Quarter-to-Date Estimated Results
- On a preliminary estimated basis, Virtu expects its results of operations for the two months ended
August 31, 2020 to reflect:
° Trading Income, net between$295 and$303 million ; Adjusted Net Trading Income* between$238 and$246 million
° Average Daily Adjusted Net Trading Income* between$5.53 and$5.72 million per day July 2020 estimated results are revised to$6.50 million Average Daily Adjusted Net Trading Income (from the previously estimated range of$6.70 to$7.00 million per day)
° Trading Income of$173 million ; Adjusted Net Trading Income* of$143 million August 2020 results of operations are preliminarily estimated to reflect:
° Trading Income, net between$122 and$130 million ; Adjusted Net Trading Income* between$95 and$103 million
° Average Daily Adjusted Net Trading Income* between$4.52 and$4.90 million per day reflecting overall declines in volumes and volatility benchmarks in theU.S. andEurope
Third Quarter Conference Call
Virtu will announce its results for the third quarter 2020 on
The company will host a conference call to discuss the company's financial results that day at
* Non-GAAP financial measures. Please see “Non-GAAP Financial Measures and Other Items” for more information.
The preliminary financial and other data set forth above has been prepared by, and is the responsibility of our management. The foregoing information and estimates have not been compiled or examined by our independent registered public accounting firm nor have our independent registered public accounting firm performed any procedures with respect to this information or expressed any opinion or any form of assurance of such information. In addition, the foregoing information and estimates are subject to revision as we prepare our consolidated financial statements and other disclosures as of and for the three months ended
Non-GAAP Financial Measures and Other Items
To supplement our unaudited condensed consolidated financial statements presented in accordance with generally accepted accounting principles ("GAAP"), we use the following non-GAAP measures of financial performance:
- "Adjusted Net Trading Income", which is the amount of revenue we generate from our market making activities, or trading income, net, plus commissions, net and technology services, plus interest and dividends income and expense, net, less direct costs associated with those revenues, including brokerage, exchange and clearance fees, net and payments for order flow. Management believes that this measurement is useful for comparing general operating performance from period to period. Although we use Adjusted Net Trading Income as a financial measure to assess the performance of our business, the use of Adjusted Net Trading Income is limited because it does not include certain material costs that are necessary to operate our business. Our presentation of Adjusted Net Trading Income should not be construed as an indication that our future results will be unaffected by revenues or expenses that are not directly associated with our market making activities.
Adjusted Net Trading Income is a non-GAAP financial measure used by management in evaluating operating performance and in making strategic decisions. Management believes that the presentation of Adjusted Net Trading Income provides useful information to investors regarding our results of operations because they assist both investors and management in analyzing and benchmarking the performance and value of our business. Adjusted Net Trading Income provides indicators of general economic performance that are not affected by fluctuations in certain costs or other items. Accordingly, management believes that this measurement is useful for comparing general operating performance from period to period. Other companies may define Adjusted Net Trading Income differently, and as a result our measures of Adjusted Net Trading Income may not be directly comparable to those of other companies. Although we use this non-GAAP financial measure as a financial measure to assess the performance of our business, such use is limited because it does not include certain material costs necessary to operate our business.
Adjusted Net Trading Income should be considered in addition to, and not as a substitute for, Net Income in accordance with
- they do not reflect every cash expenditure, future requirements for capital expenditures or contractual commitments;
- they are not adjusted for all non-cash income or expense items that are reflected in our statements of cash flows;
- they do not reflect the impact of earnings or charges resulting from matters we consider not to be indicative of our ongoing operations; and
- they do not reflect limitations on our costs related to transferring earnings from our subsidiaries to us.
Because of these limitations, Adjusted Net Trading Income is not intended as an alternative to Net Income as an indicator of our operating performance and should not be considered as a measure of discretionary cash available to us to invest in the growth of our business or as a measure of cash that will be available to us to meet our obligations. We compensate for these limitations by using Adjusted Net Trading Income along with other comparative tools, together with
Reconciliation to Non-GAAP Operating Data (Unaudited)
The following tables reconcile estimated Trading Income, net and Adjusted Net Trading Income for the two months ended
(in thousands, except percentages) | |||||
Estimate | |||||
Reconciliation of Trading income, net to Adjusted Net Trading Income | |||||
Trading income, net | $ | 173 | |||
Commissions, net and technology services | 47 | ||||
Interest and dividends income | 1 | ||||
Brokerage, exchange, clearance fees and payments for order flow, net | (73 | ) | |||
Interest and dividends expense | (5 | ) | |||
Adjusted Net Trading Income | $ | 143 |
(in thousands, except percentages) | |||||||
Range | |||||||
Reconciliation of Trading income, net to Adjusted Net Trading Income | |||||||
Trading income, net | $ | 122 | - | 130 | |||
Commissions, net and technology services | 35 | - | 42 | ||||
Interest and dividends income | 1 | - | 1 | ||||
Brokerage, exchange, clearance fees and payments for order flow, net | (58 | ) | - | (63 | ) | ||
Interest and dividends expense | (5 | ) | - | (7 | ) | ||
Adjusted Net Trading Income | $ | 95 | - | 103 |
(in thousands, except percentages) | Jul - | ||||||
Range | |||||||
Reconciliation of Trading income, net to Adjusted Net Trading Income | |||||||
Trading income, net | $ | 295 | - | 303 | |||
Commissions, net and technology services | 82 | - | 89 | ||||
Interest and dividends income | 2 | - | 2 | ||||
Brokerage, exchange, clearance fees and payments for order flow, net | (131 | ) | - | (136 | ) | ||
Interest and dividends expense | (10 | ) | - | (12 | ) | ||
Adjusted Net Trading Income | $ | 238 | - | 246 |
About
Virtu is a leading financial services firm that leverages cutting-edge technology to provide execution services and data, analytics and connectivity products to its clients and deliver liquidity to the global markets. Leveraging its global market making expertise and infrastructure, Virtu provides a robust product suite including offerings in execution, liquidity sourcing, analytics and broker-neutral, multi-dealer platforms in workflow technology. Virtu’s product offerings allow clients to trade on hundreds of venues across 50+ countries and in multiple asset classes, including global equities, ETFs, foreign exchange, futures, fixed income and myriad other commodities. In addition, Virtu’s integrated, multi-asset analytics platform provides a range of pre and post-trade services, data products and compliance tools that clients rely upon to invest, trade and manage risk across global markets.
Cautionary Note Regarding Forward-Looking Statements
This press release may contain “forward-looking statements” made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Statements regarding
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