Q2 2024 Bgc Group Inc Earnings Call Transcript
Key Points
- BGC Group Inc (BGC) delivered record second quarter revenues and adjusted earnings, with revenue growth of 12% and earnings growth of over 19%.
- FMX and Fenics businesses contributed significantly to profit growth and margin expansion.
- BGC Group Inc (BGC) generated strong double-digit revenue growth across its three largest businesses: RATES, ECS, and foreign exchange.
- Fenics Growth Platforms saw a 22.4% increase in second quarter revenues, driven by portfolio match, Lucera, and FX portfolio match.
- The company provided a positive outlook for the third quarter of 2024, expecting total revenue between $505 million and $555 million, and pretax adjusted earnings between $110 million and $127 million.
- Equities revenues decreased by 10.4% due to lower equity derivative trading volumes.
- Non-compensation expenses under adjusted earnings increased by 5.1%, driven by higher selling and promotion, communications, and interest expense.
- The company is facing significant competition from CME, which has led to public disputes and clarifications.
- FMX is not yet profitable and is expected to reach breakeven by the end of the year, despite significant expenses incurred for its launch.
- The company’s stock is trading at a lower multiple compared to peers with similar revenue and profit growth, indicating potential undervaluation.
Greetings. Welcome to BGC Group Incorporated Second Quarter 2024 earnings call. At this time, all participants are in a listen only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I will now turn the conference over to Jason procedures, Head of Investor Relations. Thank you. May begin.
Thank you, and good morning. We issued BGC's Second Quarter 2024 financial results press release and the presentation summarizing these results this morning. Prior to market open, you can find these at ir dot BGCG. dot com. except as otherwise specified, any historical results provided on today's call compare only the second quarter of 2024 with the prior year period, and we will be referring to our results only on a non-GAAP basis, which includes the terms adjusted earnings and adjusted EBITDA.
Please refer to today's press release,
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