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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Tradestation Grp. (MM) | NASDAQ:TRAD | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 9.74 | 0 | 01:00:00 |
Brokerage commissions and fees for the 2010 third quarter were $26.0 million, as compared to 2009 third quarter brokerage commissions and fees of $28.6 million. Brokerage commissions and fees are the largest component of the company's net revenues.
"During a very difficult quarter, when market volatility, especially intra-day market volatility, decreased, we continued to generate net income and add new accounts," said David Fleischman, the company's Chief Financial Officer. "We continue to believe that TradeStation's strength and positioning speak well to our chances of developing significant market share in the active trader space over the next several years."
1The following table reconciles net income, as reported, to net income excluding the after tax effect of tax benefits, net, and net losses on marketable securities for the three months ended September 30, 2010. | ||||||
Amount (in thousands) | Earnings per Share (diluted) | |||||
Net income, as reported | $3,056 | $0.08 | ||||
Net federal, state and local tax benefits * | (2,410) | (0.06) | ||||
Net losses on marketable securities * | 426 | 0.01 | ||||
Net income, excluding the effect of federal, state and local tax benefits, net and losses on marketable securities, net | $1,072 | $0.03 | ||||
* After taxes |
TradeStation Reports DARTs and Record Total Accounts
For the 2010 third quarter, TradeStation experienced the following year-over-year daily trading results with respect to equities, futures and forex accounts:
Q3 10 | Q3 09 | % Decrease | |||||
Daily Average Revenue Trades | 75,746 | 79,577 | 5% |
The company also published today, in a separate announcement, its DARTs, Total Client Assets, Average Equities Client Credit Balances and Average Equities Client Margin Balances for the month of September 2010.
TradeStation had 47,434 active brokerage accounts at September 30, 2010, a 4.1% increase from September 30, 2009.
TradeStation's Average Client Trades 404 Times per Year and Has an Average Account Balance of $71,000 for Equities and $22,000 for Futures
TradeStation's brokerage client account metrics are among the best in the industry. TradeStation brokerage clients generated the following client account metrics in the 2010 third quarter:
Client Trading Activity | |
Annualized average revenue per account | $2,288 |
Annualized trades per account | 404 |
Client Account Assets | |
Average assets per account (Equities) | $71,000 |
Average assets per account (Futures) | $22,000 |
Company Purchases 583,079 Shares under Stock Buy-Back Plan
In the 2010 third quarter, the company purchased 583,079 shares of its common stock pursuant to its stock buy-back plan (which terminates in mid-November 2010) for a total purchase price of $3.75 million. Since buying under the plan began November 13, 2006, through September 30, 2010 the company has purchased 6,751,486 shares for a total purchase price of $58.1 million.
Under the stock buy-back plan, the company is authorized, over a 4-year period, to purchase up to $60 million of its common stock using available and unrestricted cash in the open market or through privately-negotiated transactions pursuant to one or more Rule 10b5-1 plans or programs. Pursuant to the plan, up to $1,250,000 of company cash per month during each month of the 4-year period (i.e., up to $15 million per 12-month period and up to $60 million for the 4-year period) has been authorized to be used to purchase company shares at prevailing prices, subject to compliance with applicable securities laws, rules and regulations, including Rules 10b5-1 and 10b-18. The buy-back plan does not obligate the company to acquire any specific number of shares in any period, and may be modified, suspended, extended or discontinued at any time without prior notice.
Company Provides 2010 Fourth Quarter Business Outlook
TradeStation today also published its 2010 Fourth Quarter Business Outlook.
The company's 2010 Fourth Quarter Business Outlook estimated ranges are as follows:
2010 FOURTH QUARTER BUSINESS OUTLOOK (In Millions, Except Per Share Data) | ||
2010 Fourth Quarter | ||
NET REVENUES | $30.0 to $32.0 | |
EARNINGS PER SHARE (Diluted) | $0.02 to $0.04 |
The company's 2010 fourth quarter estimated ranges are based on numerous assumptions, including: basing the midpoints of the ranges on average daily revenue per account for each asset class (equities, futures, forex) at approximately the same level as average daily revenue per account over the 9-month period ended September 30, 2010, adjusted for seasonality, plus a stub period in October 2010 (the period used and the formula and criteria applied often vary with each Business Outlook based upon management's judgment each period concerning the best assumptions to use); U.S. Treasury Bill and Treasury Note yields the company receives remaining constant at current levels throughout the remainder of the 2010 year; no unrealized gain or loss on TradeStation Securities' investment in the CBOE or its U.S. Treasury portfolio in the 2010 fourth quarter; anticipated growth, attrition and trading activity of active trader equities, futures and forex accounts, and the proportions in trading activity among those asset classes (each of which have different profit margin structures); the timing of expenses relating to the company's growth initiatives as compared to the timing of anticipated benefits from those initiatives; and numerous other assumptions concerning the company's business and industry, market conditions, and various decisions, acts or failures to act both within and outside of the company's control. All assumptions, expectations and beliefs relating to the Business Outlook are forward-looking in nature and actual results may differ materially from those estimated, including, but not limited to, as a result of, or as indicated by, the issues, uncertainties and risk factors set forth and referenced above and below. In particular, to the extent market volatility and/or market volumes move to significantly higher or lower levels, net account growth increases, slows or decreases, the U.S. Treasury Bill and/or Treasury Note rates of interest are different than what has been assumed, and/or economic or financial market conditions persist or worsen, or improve sooner or to a higher degree than expected, or the company is subject to material "mark-to-market" adjustments (up or down) on its investment in the CBOE or its U.S. treasury securities holdings, the results estimated in the Business Outlook will likely be materially different than actual results.
Conference Call/Webcast
At 11:00, a.m., Eastern Time, today, members of TradeStation Group senior management will conduct an analyst conference call to discuss the company's 2010 third quarter results and its 2010 Fourth Quarter Business Outlook. All company shareholders and the public are invited to listen. The telephone conference will be broadcast live via the Internet at www.TradeStation.com. The live webcast will be accompanied by slides of graphs and charts. A rebroadcast of the call will be accessible for approximately 90 days.
About TradeStation Group, Inc.
TradeStation Group, Inc. (Nasdaq:TRAD), through its principal operating subsidiary, TradeStation Securities, Inc., offers the TradeStation platform to the active trader and certain institutional trader markets. TradeStation is an electronic trading platform that offers state-of-the-art electronic order execution and enables clients to design, test, optimize, monitor and automate their own custom Equities, Options, Futures and Forex trading strategies.
TradeStation Securities, Inc. (Member NYSE, FINRA, SIPC, DTCC, OCC & NFA) is a licensed securities broker-dealer and a registered futures commission merchant, and also a member of the Boston Options Exchange, Chicago Board Options Exchange, Chicago Stock Exchange, International Securities Exchange and NASDAQ OMX. Its TradeStation Prime Services division, based in New York, seeks to provide prime brokerage services to small and mid-sized hedge funds and other firms. The company's technology subsidiary, TradeStation Technologies, Inc., develops and offers strategy trading software tools and subscription services. Its London-based subsidiary, TradeStation Europe Limited, an FSA-authorized brokerage firm, introduces UK and other European accounts to TradeStation Securities.
Forward-Looking Statements – Issues, Uncertainties and Risk Factors
This press release, including the 2010 Fourth Quarter Business Outlook estimated ranges contained in this press release, and today's earnings conference call, contain statements and estimates that are forward-looking and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. When used in this press release, or the conference call, the words "anticipate(s)," "anticipated," "anticipation," "assume(s)," "assumption(s)," "become(s)," "belief(s)," "believe(s)," "believed," "could," "designed," "estimate," "estimates," "estimated," "expect(s)," "expected," "expectation(s)," "going forward," "future," "hopeful," "hopefully," "hope(s)," "intend(s)," "intended," "look forward," "may," "might," "opportunity," "opportunities," "outlook(s)," "pending," "plan(s)," "planned," "potential," "scheduled," "shall," "should," "think(s)," "to be," "upcoming," "well-positioned," "will," "wish," "would," and similar expressions, if and to the extent used, are intended to identify forward-looking statements. All forward-looking statements are based largely on current expectations and beliefs concerning future events that are subject to substantial risks and uncertainties. Actual results may differ materially from the results herein suggested or suggested in the conference call. Factors that may cause or contribute to the various potential differences include, but are not limited to, the following:
TRADESTATION GROUP, INC. AND SUBSIDIARIES | ||||
CONDENSED CONSOLIDATED STATEMENTS OF INCOME | ||||
(Unaudited) | ||||
(in thousands, except per share data) | ||||
Three Months Ended | Nine Months Ended | |||
September 30, | September 30, | |||
2010 | 2009 | 2010 | 2009 | |
REVENUES: | ||||
Brokerage commissions and fees | $26,031 | $28,623 | $83,435 | $93,422 |
Interest income | 2,757 | 1,612 | 7,673 | 3,948 |
Brokerage interest expense | -- | -- | -- | -- |
Net interest income | 2,757 | 1,612 | 7,673 | 3,948 |
Subscription fees and other | 1,517 | 1,777 | 4,754 | 5,809 |
Gains (losses) on marketable securities, net | (728) | 344 | 4,175 | 344 |
Net revenues | 29,577 | 32,356 | 100,037 | 103,523 |
EXPENSES: | ||||
Employee compensation and benefits | 11,400 | 10,509 | 34,055 | 31,662 |
Clearing and execution | 6,952 | 7,160 | 22,452 | 23,822 |
Data centers and communications | 3,403 | 2,902 | 10,846 | 8,551 |
Marketing | 1,791 | 1,453 | 5,070 | 5,046 |
Professional services | 1,109 | 754 | 2,545 | 2,514 |
Occupancy and equipment | 805 | 800 | 2,364 | 2,282 |
Depreciation and amortization | 1,317 | 1,062 | 3,330 | 3,306 |
Other | 2,474 | 1,653 | 6,220 | 4,862 |
Total expenses | 29,251 | 26,293 | 86,882 | 82,045 |
Income before income taxes | 326 | 6,063 | 13,155 | 21,478 |
INCOME TAX (BENEFIT) PROVISION | (2,730) | 2,366 | 2,484 | 8,420 |
Net income | $3,056 | $3,697 | $10,671 | $13,058 |
EARNINGS PER SHARE: | ||||
Basic | $0.08 | $0.09 | $0.27 | $0.31 |
Diluted | $0.08 | $0.09 | $0.26 | $0.31 |
WEIGHTED AVERAGE SHARES | ||||
OUTSTANDING: | ||||
Basic | 39,624 | 41,285 | 40,051 | 41,715 |
Diluted | 39,996 | 41,792 | 40,476 | 42,188 |
TRADESTATION GROUP, INC. AND SUBSIDIARIES | ||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
(in thousands) | ||
September 30, | December 31, | |
2010 | 2009 | |
(Unaudited) | ||
ASSETS: | ||
Cash and cash equivalents, including restricted cash of $478 at September 30, 2010 and $717 at December 31, 2009* | $52,512 | $57,405 |
Cash and investments segregated in compliance with federal regulations | 1,277,768 | 785,208 |
Marketable securities* | 56,678 | 76,342 |
Receivables from brokers, dealers, clearing organizations and clearing agents | 36,689 | 32,226 |
Receivables from brokerage customers, net | 53,227 | 45,034 |
Property and equipment, net | 16,711 | 7,578 |
Deferred income taxes, net | 1,780 | 1,276 |
Deposits with clearing organizations | 35,485 | 38,521 |
Other assets | 4,122 | 5,606 |
Total assets | $1,534,972 | $1,049,196 |
LIABILITIES AND SHAREHOLDERS' EQUITY: | ||
LIABILITIES: | ||
Payables to brokers, dealers and clearing organizations | $198 | $114 |
Payables to brokerage customers | 1,347,914 | 868,741 |
Accounts payable | 5,340 | 2,627 |
Accrued expenses | 8,210 | 7,206 |
Total liabilities | 1,361,662 | 878,688 |
COMMITMENTS AND CONTINGENCIES | ||
SHAREHOLDERS' EQUITY | 173,310 | 170,508 |
Total liabilities and shareholders' equity | $1,534,972 | $1,049,196 |
*Marketable securities as of September 30, 2010 exclude $4.0 million that was transferred on October 1, 2010 from cash and investments segregated in compliance with federal regulations. Cash and cash equivalents as of December 31, 2009 include $7.7 million that was transferred on January 4, 2010 to cash and investments segregated in compliance with federal regulations. |
CONTACT: David H. Fleischman Chief Financial Officer TradeStation Group, Inc. 954-652-7000
1 Year Tradestation Grp. (MM) Chart |
1 Month Tradestation Grp. (MM) Chart |
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