(RTTNews) - Interactive Brokers Group, Inc. (IBKR:
News ) reported Thursday lower profit for its third quarter that also missed analysts' estimates, hurt by continued pressure on spreads as competition in the transparent exchange listed derivatives markets increased.
The Greenwich, Connecticut-based group's quarterly net income available for common shareholders plunged to $8.5 million or $0.20 per share from $27.2 million or $0.65 per share in the same quarter a year-ago. On average, seven analysts polled by Thomson Reuters expected the company to earn $0.31 per share for the quarter. Analysts' estimates typically exclude special items.
Interactive Brokers' quarterly total net revenues declined to $271.5 million, a decrease from Street view of $297.60 million and from previous year quarter revenue of $497.1 million. On a segmental basis, revenue from market making fell to $150.3 million from $359.7 million, and electronic brokerage revenues dropped to $121.5 million from $134.6 million.
The brokerage reported 7% decline in quarterly total trade to 58.16 million from 62.22 million. Average trades per U.S. trading deay was down to 909 from 972. Option and future contracts slumped 24% and 33% respectively, year-over-year. The company reported 20% increase in customer accounts and 43% increase in customer equity from the year ago quarter.
The group's quarterly interest expenses fell to $15.1 million form $70.8 million, while total non-interest expenses declined to $133.1 million from $347.5 million. Employee compensation and benefits rose to $43.0 million from $39.5 million in the prior year quarter.
For the latest third quarter, pre-tax profit margin fell to 49% from 70% last year. Though revenues from market making segment outweighed that of electronic brokerage, pre-tax profit margin in electronic brokerage was 51%, higher than market making's 49%.
IBKR closed Thursday's trading at $19.56 on the Nasdaq.
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by RTT Staff Writer
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