Bgc Group, Inc. · NASDAQ:BGC
Bgc — BGC Partners — Q1 2021 Earnings Presentation
29 slides from Bgc's earnings presentation, 2021
Slide 1: BGC Partners Earnings Presentation 1Q 2021
BGC PARTNERS, INC. NASDAQ: BGCP E A R N I N G S P R E S E N TAT I O N 1 Q 2 0 2 1
Slide 2: Disclaimer
DISCLAIMER 2 DISCUSSION OF FORWARD-LOOKING STATEMENTS ABOUT BGC Statements in this document regarding BGC that are not historical facts are “forward-looking statements” that involve risks and uncertainties, which could cause actual results to differ from those contained in the forward- looking state
Slide 3: Highlights of Consolidated Results: 1Q 2021
HIGHLIGHTS OF CONSOLIDATED RESULTS: 1Q 2021 3 REVENUES: Highlights of Consolidated Results 1Q 2021 1Q 2020 Change $568M (USD millions, except per share data) Revenues $567.6 $603.2 (5.9)% Fenics GAAP income from operations before income taxes 74.1 31.0 138.6% Markets 17% GAAP net income for fully di
Slide 4: Overview: Revenue by Asset Class & Geography 1Q 2021
OVERVIEW: REVENUE BY ASSET CLASS & GEOGRAPHY 1Q 2021 4 REVENUE BY ASSET CLASS GLOBAL REVENUE & LOCATIONS AMERICAS EMEA APAC Rates 1Q 2021 1Q 2021 1Q 2021 Data, Software & Post-trade and Revenues: Revenues: Revenues: Other1 $325M $83M 29% $159M 6% Insurance 9% Edinburgh Copenhagen 1Q 15% FX Chicago T
Slide 5: Overview: Fenics
OVERVIEW: FENICS 5 BUSINESS OVERVIEW 1Q 2021 REVENUE COMPOSITION Fenics Markets: Includes the fully electronic NET REVENUES: 21% portions of BGC’s brokerage businesses, 42% Data, Software & Data, Software and Post-trade revenues that are unrelated to Fenics Growth Platforms, as $106M Rates Post-trad
Slide 6: Fenics UST
FENICS UST 6 UST TRADING VOLUME FENICS UST CLOB MARKET SHARE1 MARCH 2021 UST MARKET SHARE1 1Q 2021 Quarterly Average Nasdaq2 (ADV yr/yr change) Dealerweb 4% 5% CME Primary 16% Tradeweb Fenics UST BrokerTec Dealerweb Nasdaq2 Nasdaq Dealer3 Dealer 23% 14% All: 9% CLOB: 18% 47% 12% 33% 10% 9% 9% Mar 21
Slide 7: Fenics GO
FENICS GO 7 MARKET SHARE ESTIMATES1 EURO STOXX 50 NIKKEI 225 (EUREX) (OSE) 1Q21 Volumes up ~2x (yr/yr) 1Q21 Volumes up over 85x (yr/yr) 13.6% 13.0% 10.8% 10.1% 8.8% 7.5% 5.9% 5.7% 6.0% 5.4% 5.3% 4.1% 4.2% 4.0% 3.5% 3.5% 0.8% 0.6% NMF 1Q20 2Q20 3Q20 4Q20 1Q21 1Q20 2Q20 3Q20 4Q20 1Q21 Front Month Shor
Slide 8: Competitive Landscape
COMPETITIVE LANDSCAPE 8 COMPETITIVE LANDSCAPE MARKET FOCUS MarketAxess Tradeweb CME Markets Growth Platforms CASH ✔ ✔ ✔ ✔ ✔ RATES DERIVATIVES ✔ ✔ ✔ CASH ✔ ✔ ✔ CREDIT DERIVATIVES ✔ ✔ CASH ✔ ✔ ✔ FX DERIVATIVES ✔ ✔ ✔ CASH / ETF ✔ EQUITIES DERIVATIVES1 ✔ ✔ ✔ ✔ ✔ DATA, SOFTWARE, & POST-TRADE ✔ ✔ ✔ ✔ ✔ MO
Slide 9: Overview: Corant
OVERVIEW: CORANT 9 HIGHLIGHTS INSURANCE BROKERAGE REVENUE PERFORMANCE Record brokerage revenues of $190M $183M $52.4M, up 17% yr/yr, driven by strong $169M $174M $177M growth across all business lines $52M $156M $45M $128M $31M $107M Second consecutive quarter of AE profitability, driven by improved
Slide 10: Outlook: 2Q 2021
OUTLOOK: 2Q 2021 10 10 Guidance Actual Metric (USD million) 2Q21 2Q20 Revenues $485 - 535 $519.1 Pre-tax Adjusted Earnings $88 - 108 $92.1 Metric (%) FY 2021 FY 2020 Adjusted Earnings Tax Rate 10 - 12% 11.0% ▪ BGC’s revenues were approximately 9 percent lower year-on-year for the first 18 trading da
Slide 11: GAAP Financial Results
BGC PARTNERS, INC. GAAP FINANCIAL RESULTS
Slide 12: Condensed Consolidated Statements of Financial Condition
BGC PARTNERS, INC. CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION 12 (IN THOUSANDS, EXCEPT PER SHARE DATA) (UNAUDITED) (UNDER GAAP) March 31, December 31, 2021 2020 Assets Cash and cash equivalents $ 574,384 $ 593,646 Cash segregated under regulatory requirements 257,512 257,031 Securities
Slide 13: Condensed Consolidated Statements of Operations (1/2)
BGC PARTNERS, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (1/2) 13 (IN THOUSANDS, EXCEPT PER SHARE DATA) (UNAUDITED) (UNDER GAAP) Three Months Ended March 31, Revenues: 2021 2020 Commissions $ 435,220 $ 455,855 Principal transactions 98,763 113,311 Total brokerage revenues 533,983 569,166 F
Slide 14: Condensed Consolidated Statements of Operations (2/2)
BGC PARTNERS, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (2/2) 14 (IN THOUSANDS, EXCEPT PER SHARE DATA) (UNAUDITED) (UNDER GAAP) Three Months Ended March 31, 2021 2020 Per share data: Basic earnings (loss) per share Net income (loss) available to common stockholders $ 43,091 $ 13,674 Basic
Slide 15: Appendix
MMM BGC PARTNERS, INC. =e bgc (5 SF! Fenics
Slide 16: Front Office Headcount & Productivity
FRONT OFFICE HEADCOUNT & PRODUCTIVITY 16 FRONT OFFICE HEADCOUNT AND PRODUCTIVITY (Productivity in USD 000s) (Excludes Insurance Brokerage) $756 2,700 $748 $744 $747 $753 $750 $760 TECHNOLOGY 2,650 $736 $749 2,600 2,550 $735 2,500 2,450 $750 2,400 2,350 2,300 2,250 2,200 2,150 $740 2,100 2,050 2,000
Slide 17: BGC's Fully Diluted Share Count Summary as of 3/31/21
BGC’S FULLY DILUTED SHARE COUNT SUMMARY AS OF 3/31/21 17 17 BGC Partners, Inc. Fully Diluted Share Count Summary Fully-diluted Shares Ownership (%) (as of March 31, 2021) (millions) Public 317.3 57% Class A owned by Public 317.3 57% Employees 138.7 25% Class A owned by executives, board members and
Slide 18: Strongly Capitalized; Investment Grade Credit Profile
STRONGLY CAPITALIZED; INVESTMENT GRADE CREDIT PROFILE 18 BGC Partners, Inc. As of 3/31/2021 INVESTMENT GRADE CREDIT 18RATING Cash and Cash Equivalents 574,384 ▪ Investment Grade Credit Rated: Securities Owned 59,527 Marketable Securities 338 • Fitch: BBB- (Outlook: Stable) Repurchase Agreements (94)
Slide 19: Industry Volumes
INDUSTRY VOLUMES 19 Energy & Equity Derivatives & Rates Credit FX Commodities Cash Equities 1Q21: Industry Volumes % Change (yr/yr) U.S.: 34% Cash1: (2)% 39% (17)% n/a European: (18)% U.S.: 49% Derivatives1: (3)% (31)% (3)% (17)% European: (36)% 2Q21TD: Industry Volumes % Change (yr/yr) U.S.: (22)%
Slide 20: Non-GAAP Definitions and Reconciliation Tables
BGC PARTNERS, INC. NON-GAAP DEFINITIONS AND RECONCILIATION TABLES
Slide 21: Reconciliation of GAAP Income to Adjusted Earnings & Post-Tax Adjusted EPS
RECONCILIATION OF GAAP INCOME (LOSS) FROM OPERATIONS BEFORE INCOME TAXES TO ADJUSTED EARNINGS & GAAP FULLY DILUTED EPS TO POST-TAX ADJUSTED EPS 21 (IN THOUSANDS, EXCEPT PER SHARE DATA) (UNAUDITED) Q1 2021 Q1 2020 GAAP income (loss) from operations before income taxes Pre-tax adjustments: $ 74,064 $
Slide 22: Reconciliation of GAAP Income to Adjusted Earnings (Footnotes)
RECONCILIATION OF GAAP INCOME (LOSS) FROM OPERATIONS BEFORE INCOME TAXES TO ADJUSTED EARNINGS & GAAP FULLY DILUTED EPS TO POST-TAX ADJUSTED EPS 22 (IN THOUSANDS, EXCEPT PER SHARE DATA) (UNAUDITED) (1) The components of equity-based compensation and allocations of net income to limited partnership un
Slide 23: Reconciliation of GAAP Net Income to Adjusted EBITDA
RECONCILIATION OF GAAP NET INCOME (LOSS) AVAILABLE TO COMMON STOCKHOLDERS TO ADJUSTED EBITDA (IN THOUSANDS) 23 (UNAUDITED) 23 Q1 2021 Q1 2020 GAAP net income (loss) available to common stockholders $ 43,091 $ 13,674 Add back: Provision (benefit) for income taxes 14,939 10,875 Net income (loss) attri
Slide 24: Fully Diluted Weighted-Average Share Count and Liquidity Analysis
FULLY DILUTED WEIGHTED-AVERAGE SHARE COUNT UNDER GAAP AND FOR ADJUSTED EARNINGS & LIQUIDITY ANALYSIS (IN THOUSANDS) 24 (UNAUDITED) 24 FULLY DILUTED WEIGHTED AVERAGE SHARE COUNT LIQUIDITY ANALYSIS Q1 2021 Q1 2020 March 31, 2021 December 31, 2020 Common stock outstanding 374,318 358,001 Limited partne
Slide 25: Differences Between Non-GAAP and GAAP Consolidated Results
DIFFERENCES BETWEEN NON-GAAP AND GAAP CONSOLIDATED RESULTS 25 NON-GAAP FINANCIAL MEASURES 25 This document contains non-GAAP financial measures that differ from the most directly comparable measures calculated and presented in accordance with Generally Accepted Accounting Principles in the United St
Slide 26: Differences Between Non-GAAP and GAAP Consolidated Results (Continued)
DIFFERENCES BETWEEN NON-GAAP AND GAAP CONSOLIDATED RESULTS 26 (CONTINUED) All share equivalents that are part of the Company’s equity-based compensation program, including REUs, PSUs, LPUs, HDUs, and other units that may be made exchangeable into common stock, as well as RSUs (which are recorded usi
Slide 27: Differences Between Non-GAAP and GAAP Consolidated Results (Continued)
DIFFERENCES BETWEEN NON-GAAP AND GAAP CONSOLIDATED RESULTS 27 (CONTINUED) After application of these adjustments, the result is the Company’s taxable income for its pre-tax Adjusted Earnings, to which BGC then applies the statutory tax rates to determine its non-GAAP tax provision. BGC views the eff
Slide 28: Differences Between Non-GAAP and GAAP Consolidated Results (Continued)
DIFFERENCES BETWEEN NON-GAAP AND GAAP CONSOLIDATED RESULTS 28 (CONTINUED) ADJUSTED EBITDA DEFINED BGC also provides an additional non-GAAP financial performance measure, “Adjusted EBITDA”, which it defines as GAAP “Net income (loss) available to common stockholders”, adjusted to add back the followi
Slide 29: Media and Investor Contacts
29 29 Media Contact: Karen Laureano-Rikardsen +1 212-829-4975 Investor Contact: ir.bgcpartners.com Jason Chryssicas twitter.com/bgcpartners +1 212-610-2426 linkedin.com/company/bgc-partners