StoneX registers 32% Y/Y jump in FX/CFD revenues in Q2 FY22
StoneX Group Inc. (NASDAQ:SNEX), a diversified global brokerage which owns brands such as FOREX.com and City Index, has announced its financial results for the fiscal year 2022 second quarter ended March 31, 2022.
Operating revenues derived from FX/CFD contracts increased $24.2 million, or 32%, to $98.9 million in the three months ended March 31, 2022 compared to $74.7 million in the three months ended March 31, 2021, principally as a result of an $18.8 million increase in such operating revenues within StoneX’s Retail segment.
Operating revenues derived from OTC derivatives increased $27.3 million, or 78%, to $62.4 million in the three months ended March 31, 2022 compared to $35.1 million in the three months ended March 31, 2021. This was the result of strong growth in OTC derivative contract volumes and the average rate per contract of 18% and 52%, respectively in the three months ended March 31, 2022. This growth was principally driven by increased volatility in global commodity and interest rate markets.
Operating revenues across all segments increased $73.3 million, or 16%, to $544.7 million in the three months ended March 31, 2022 compared to $471.4 million in the three months ended March 31, 2021.
Operating revenues for the three months ended March 31, 2021 included a $1.2 million loss on derivative positions used to mitigate StoneX’s exposure to the British Pound in the acquired Gain subsidiaries in advance of the March 1, 2021 transfer of the majority of the operations of Gain’s U.K. domiciled subsidiaries into StoneX Financial Ltd., a U.S. dollar denominated entity.
In addition, as Gain’s U.K. subsidiaries had a functional currency of British Pound, the increased U.S. dollar exposure resulted in a $3.1 million foreign currency gain on revaluation for the three months ended March 31, 2021.
The results of the three months ended March 31, 2022 include a nonrecurring gain of $6.4 million related to a foreign exchange antitrust class action settlement received in March 2022.
Sean M. O’Connor, CEO of StoneX Group Inc., stated,
“Our broad product offering and diversified client base, combined with generally favorable market conditions, helped us deliver record core operating results in the second quarter of fiscal 2022. This included net income of $64.0 million, or $3.11 per share, with especially strong results coming from our Commercial and Retail segments, which represented an ROE of 26.1% on stated book value and a 29.0% ROE on tangible book value.
For the year-to-date period, we recorded net income of $105.7 million, or $5.15 per share, and an ROE of 22.1% on stated book value. Current market conditions remain broadly positive for us with heightened volatility and rising interest rates.”