KCG Holdings, Inc. Class A (NYSE:KCG) has earlier today posted its financial metrics for the third quarter of 2015, with the numbers turning out very solid as the company has managed to benefit from an upturn in market conditions in the US equity market.
GAAP pre-tax income for the three months to the end of September 2015 amounted to $35.4 million, compared with a loss recorded in the preceding quarter and the corresponding period in 2014.
Non-GAAP pre-tax income for the third quarter of 2015 amounted to $69.45 million, staging a steep rise from the $3.07 million registered in the second quarter of 2015. The result compared with a loss of $19.5 million in the third quarter of 2014.
Consolidated (GAAP) revenues for the three months to September 30, 2015 amounted to $377 million, up massive 44% from the preceding quarter and up 38.5% from the corresponding period in 2014.
Consolidated earnings for the third quarter of 2015 are $21.9 million, or $0.24 per diluted share.
Market making set a new quarterly high for exchange-listed U.S. equity share volume and gained approximately two percentage points in market share of retail SEC Rule 605 U.S. equity share volume from the second quarter 2015.
Average daily algorithmic execution U.S. equity share volume attributable to institutional clients marked a rise quarter over quarter and year over year.
Daniel Coleman, Chief Executive Officer of KCG, said,
“KCG generated strong financial results in the third quarter of 2015 amid an upturn in market conditions in the U.S. equity market. The performance was driven by KCG market making in U.S. equities as well as agency-based trading on behalf of institutional clients. The results for the quarter were lowered due to writedowns for the consolidation of current real estate as well as expenses attributable to the corporate relocation. Notwithstanding, we produced significant growth in non-GAAP pre-tax income while continuing to reduce our total shares outstanding.”
Market Making
The Market Making segment encompasses direct-to-client and non-client, exchange-based market making across multiple asset classes and is an active participant in all major cash, options and futures markets in the U.S., Europe and Asia. During the third quarter of 2015, the segment delivered total revenues of $299.8 million and pre-tax income of $85.4 million. Excluding expenses related to asset writedowns of $4.4 million, the segment generated pre-tax income of $89.8 million.
Global Execution Services
The Global Execution Services segment comprises agency execution services and trading venues. During the third quarter of 2015, the segment generated total revenues of $69.7 million and a pre-tax loss of $1.1 million.
Corporate and Other
The Corporate and Other segment includes strategic investments and corporate overhead expenses. During the third quarter of 2015, the segment generated total revenues of $7.6 million and a pre-tax loss of $49.0 million. Excluding writedown of assets and other real estate related charges of $29.7 million, the segment generated a pre-tax loss of $19.3 million.
To view the official announcement on the corporate results for the third quarter of 2015, click here.