Virtu registers steep rise in revenues in Q3 2020 driven by sale of MATCHNow
Provider of financial services and products Virtu Financial Inc (NASDAQ:VIRT) today reported its financial results for the third quarter of 2020.
Total revenues increased 71.6% year-on-year to $656.1 million in the quarter to the end of September 2020, driven by the gain on the sale of MATCHNow as well as heightened levels of volatility, bid-ask spreads and trading volumes across global markets and asset classes due to the COVID-19 pandemic.
On August 4, 2020, the company completed the sale of MATCHNow to Cboe Global Markets, Inc. for total gross proceeds of $60.6 million in cash. Virtu recorded a gain on the sale of $58.6 million. The net gain on the sale of MATCHNow was $56.2 million including one-time transaction related professional fees of $2.5 million directly related to the sale.
Trading income, net, amounted to $441.3 million in the third quarter of 2020, up 100.5% from the result registered in the same period in 2019. Net income totaled $199.7 million for the third quarter of 2020, compared to a net loss of $5.2 million in the prior year quarter, which included costs related to the ITG acquisition.
Basic and diluted earnings per share for this quarter was $0.92, compared to a basic and diluted loss per share of $0.04 for the same period in 2019.
Adjusted Net Trading Income increased 45.0% to $362.3 million for this quarter, compared to $249.8 million for the same period in 2019. Adjusted EBITDA increased 139.5% to $248.7 million for this quarter, compared to $103.9 million for the same period in 2019.
The Virtu Financial, Inc. Board of Directors declared a quarterly cash dividend of $0.24 per share. This dividend is payable on December 15, 2020 to shareholders of record as of December 1, 2020.
Douglas Cifu, Chief Executive Officer, commented:
“Virtu enters the final quarter of an eventful 2020 and looks forward to 2021 well positioned to continue to generate shareholder value. With our revised expense guidance for 2021 and the material reduction in total debt as a result of the strong performance in 2020, we are poised to meaningfully enhance shareholder returns, beginning with up to a $100 million buyback of shares, which our Board of Directors has approved.”