Yahoo FinanceInteractive Brokers Group Announces 4Q2021 Results
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- IBKR
GAAP DILUTED EPS OF $0.67, ADJUSTED1 EPS OF $0.83
GAAP NET REVENUES OF $603 MILLION, ADJUSTED NET REVENUES OF $683 MILLION
GREENWICH, Conn., January 18, 2022--(BUSINESS WIRE)--Interactive Brokers Group, Inc. (Nasdaq: IBKR), an automated global electronic broker, announced results for the quarter ended December 31, 2021.
Reported diluted earnings per share were $0.67 for the current quarter and $0.83 as adjusted. For the year-ago quarter, reported diluted earnings per share were $0.81 and $0.69 as adjusted.
Reported net revenues were $603 million for the current quarter and $683 million as adjusted. For the year-ago quarter, reported net revenues were $599 million and $582 million as adjusted.
Reported income before income taxes was $373 million for the current quarter and $453 million as adjusted. For the year-ago quarter, reported income before income taxes was $392 million and $375 million as adjusted.
Financial Highlights
Commission revenue increased $32 million, or 11%, from the year-ago quarter on higher customer options and futures trading volumes and higher average per share commission in stocks.
Net interest income increased $70 million, or 31%, from the year-ago quarter on higher margin loan balances and strong securities lending activity.
Other income decreased $104 million from the year-ago quarter. This decrease was mainly comprised of $89 million related to our strategic investment in Up Fintech Holding Limited ("Tiger Brokers") and $10 million related to our currency diversification strategy.
Reported pretax profit margin was 62% for the current quarter and 66% as adjusted. For the year-ago quarter, reported pretax margin was 65% and 64% as adjusted.
Total equity of $10.2 billion.
The Interactive Brokers Group, Inc. Board of Directors declared a quarterly cash dividend of $0.10 per share. This dividend is payable on March 14, 2022 to shareholders of record as of March 1, 2022.
Business Highlights
Customer accounts increased 56% from the year-ago quarter to 1.68 million.
Customer equity grew 30% from the year-ago quarter to $373.8 billion.
Total DARTs2 increased 16% from the year-ago quarter to 2.44 million.
Cleared DARTs increased 16% from the year-ago quarter to 2.16 million.
Customer credits increased 12% from the year-ago quarter to $87.1 billion.
Customer margin loans increased 40% from the year-ago quarter to $54.6 billion.
Effects of Foreign Currency Diversification
In connection with our currency diversification strategy, we base our net worth in GLOBALs, a basket of 10 major currencies in which we hold our equity. In this quarter, our currency diversification strategy decreased our comprehensive earnings by $25 million, as the U.S. dollar value of the GLOBAL decreased by approximately 0.22%. The effects of the currency diversification strategy are reported as components of (1) Other Income (loss of $23 million) and (2) Other Comprehensive Income (loss of $2 million).
Conference Call Information:
Interactive Brokers Group, Inc. will hold a conference call with investors today, January 18, 2022, at 4:30 p.m. ET to discuss its quarterly results. Investors who would like to listen to the conference call live should dial 877-324-1965 (U.S. domestic) and 631-291-4512 (international). The number should be dialed approximately ten minutes prior to the start of the conference call. Ask for the "Interactive Brokers Conference Call." The conference call will also be accessible simultaneously, and through replays, as an audio webcast through the Investor Relations section of the Interactive Brokers web site, www.interactivebrokers.com/ir.
About Interactive Brokers Group, Inc.:
Interactive Brokers Group affiliates provide automated trade execution and custody of securities, commodities and foreign exchange around the clock on over 135 markets in numerous countries and currencies, from a single IBKR Integrated Investment Account to clients worldwide. We service individual investors, hedge funds, proprietary trading groups, financial advisors and introducing brokers. Our four decades of focus on technology and automation has enabled us to equip our clients with a uniquely sophisticated platform to manage their investment portfolios. We strive to provide our clients with advantageous execution prices and trading, risk and portfolio management tools, research facilities and investment products, all at low or no cost, positioning them to achieve superior returns on investments. Barron’s ranked Interactive Brokers #1 with 5 out of 5 stars in its February 26, 2021, Best Online Broker Review.
Cautionary Note Regarding Forward-Looking Statements:
The foregoing information contains certain forward-looking statements that reflect the Company’s current views with respect to certain current and future events and financial performance. These forward-looking statements are and will be, as the case may be, subject to many risks, uncertainties and factors relating to the Company’s operations and business environment which may cause the Company’s actual results to be materially different from any future results, expressed or implied, in these forward-looking statements. Any forward-looking statements in this release are based upon information available to the Company on the date of this release. The Company does not undertake to publicly update or revise its forward-looking statements even if experience or future changes make it clear that any statements expressed or implied therein will not be realized. Additional information on risk factors that could potentially affect the Company’s financial results may be found in the Company’s filings with the Securities and Exchange Commission.
______________________
1 See the reconciliation of non-GAAP financial measures starting on page 9.
2 Daily average revenue trades (DARTs) are based on customer orders.
INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES | ||||||||||||||||
CONSOLIDATED STATEMENTS OF INCOME | ||||||||||||||||
(UNAUDITED) | ||||||||||||||||
Three Months | Twelve Months | |||||||||||||||
Ended December 31, | Ended December 31, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
(in millions, except share and per share data) | ||||||||||||||||
Revenues: | ||||||||||||||||
Commissions | $ | 320 | $ | 288 | $ | 1,350 | $ | 1,112 | ||||||||
Other fees and services | 58 | 52 | 218 | 175 | ||||||||||||
Other income (loss) | (70 | ) | 34 | (2 | ) | 59 | ||||||||||
Total non-interest income | 308 | 374 | 1,566 | 1,346 | ||||||||||||
Interest income | 350 | 280 | 1,372 | 1,133 | ||||||||||||
Interest expense | (55 | ) | (55 | ) | (224 | ) | (261 | ) | ||||||||
Total net interest income | 295 | 225 | 1,148 | 872 | ||||||||||||
Total net revenues | 603 | 599 | 2,714 | 2,218 | ||||||||||||
Non-interest expenses: | ||||||||||||||||
Execution, clearing and distribution fees | 53 | 66 | 236 | 293 | ||||||||||||
Employee compensation and benefits | 108 | 86 | 399 | 325 | ||||||||||||
Occupancy, depreciation and amortization | 22 | 18 | 80 | 69 | ||||||||||||
Communications | 9 | 7 | 33 | 26 | ||||||||||||
General and administrative | 38 | 30 | 176 | 236 | ||||||||||||
Customer bad debt | - | - | 3 | 13 | ||||||||||||
Total non-interest expenses | 230 | 207 | 927 | 962 | ||||||||||||
Income before income taxes | 373 | 392 | 1,787 | 1,256 | ||||||||||||
Income tax expense | 35 | 12 | 151 | 77 | ||||||||||||
Net income | 338 | 380 | 1,636 | 1,179 | ||||||||||||
Net income attributable to noncontrolling interests | 271 | 309 | 1,328 | 984 | ||||||||||||
Net income available for common stockholders | $ | 67 | $ | 71 | $ | 308 | $ | 195 | ||||||||
Earnings per share: | ||||||||||||||||
Basic | $ | 0.68 | $ | 0.82 | $ | 3.27 | $ | 2.44 | ||||||||
Diluted | $ | 0.67 | $ | 0.81 | $ | 3.24 | $ | 2.42 | ||||||||
Weighted average common shares outstanding: | ||||||||||||||||
Basic | 98,181,875 | 87,076,038 | 94,167,572 | 79,939,289 | ||||||||||||
Diluted | 98,980,339 | 87,772,443 | 95,009,880 | 80,638,908 | ||||||||||||
INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES | ||||||||||||||
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||||||||||||||
(UNAUDITED) | ||||||||||||||
Three Months | Twelve Months | |||||||||||||
Ended December 31, | Ended December 31, | |||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||
(in millions, except share and per share data) | ||||||||||||||
Comprehensive income: | ||||||||||||||
Net income available for common stockholders | $ | 67 | $ | 71 | $ | 308 | $ | 195 | ||||||
Other comprehensive income: | ||||||||||||||
Cumulative translation adjustment, before income taxes | (1 | ) | 26 | (22 | ) | 26 | ||||||||
Income taxes related to items of other comprehensive income | - | - | - | - | ||||||||||
Other comprehensive income (loss), net of tax | (1 | ) | 26 | (22 | ) | 26 | ||||||||
Comprehensive income available for common stockholders | $ | 66 | $ | 97 | $ | 286 | $ | 221 | ||||||
Comprehensive earnings per share: | ||||||||||||||
Basic | $ | 0.67 | $ | 1.05 | $ | 3.04 | $ | 2.77 | ||||||
Diluted | $ | 0.67 | $ | 1.05 | $ | 3.01 | $ | 2.74 | ||||||
Weighted average common shares outstanding: | ||||||||||||||
Basic | 98,181,875 | 87,076,038 | 94,167,572 | 79,939,289 | ||||||||||
Diluted | 98,980,339 | 87,772,443 | 95,009,880 | 80,638,908 | ||||||||||
Comprehensive income attributable to noncontrolling interests: | ||||||||||||||
Net income attributable to noncontrolling interests | $ | 271 | $ | 309 | $ | 1,328 | $ | 984 | ||||||
Other comprehensive income - cumulative translation adjustment | (1 | ) | 74 | (75 | ) | 98 | ||||||||
Comprehensive income attributable to noncontrolling interests | $ | 270 | $ | 383 | $ | 1,253 | $ | 1,082 | ||||||
INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES | |||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION | |||||||||||
(UNAUDITED) | |||||||||||
December 31, | December 31, | ||||||||||
(in millions) | |||||||||||
Assets | |||||||||||
Cash and cash equivalents | $ | 2,449 | $ | 4,292 | |||||||
Cash - segregated for regulatory purposes | 22,888 | 15,903 | |||||||||
Securities - segregated for regulatory purposes | 15,121 | 27,821 | |||||||||
Securities borrowed | 3,912 | 4,956 | |||||||||
Securities purchased under agreements to resell | 4,380 | 792 | |||||||||
Financial instruments owned, at fair value | 673 | 630 | |||||||||
Receivables from customers, net of allowance for credit losses | 54,935 | 39,333 | |||||||||
Receivables from brokers, dealers and clearing organizations | 3,719 | 1,254 | |||||||||
Other assets | 872 | 698 | |||||||||
Total assets | $ | 108,949 | $ | 95,679 | |||||||
Liabilities and equity | |||||||||||
Liabilities | |||||||||||
Short-term borrowings | $ | 27 | $ | 118 | |||||||
Securities loaned | 11,769 | 9,838 | |||||||||
Financial instruments sold but not yet purchased, at fair value | 182 | 153 | |||||||||
Other payables: | |||||||||||
Customers | 85,634 | 75,882 | |||||||||
Brokers, dealers and clearing organizations | 559 | 182 | |||||||||
Other payables | 556 | 503 | |||||||||
86,749 | 76,567 | ||||||||||
Total liabilities | 98,727 | 86,676 | |||||||||
Equity | |||||||||||
Stockholders' equity | 2,395 | 1,951 | |||||||||
Noncontrolling interests | 7,827 | 7,052 | |||||||||
Total equity | 10,222 | 9,003 | |||||||||
Total liabilities and equity | $ | 108,949 | $ | 95,679 | |||||||
December 31, 2021 | December 31, 2020 | ||||||||||
Ownership of IBG LLC Membership Interests | Interests | % | Interests | % | |||||||
IBG, Inc. | 98,230,127 | 23.5 | % | 90,780,444 | 21.8 | % | |||||
Noncontrolling interests (IBG Holdings LLC) | 319,880,492 | 76.5 | % | 325,960,034 | 78.2 | % | |||||
Total IBG LLC membership interests | 418,110,619 | 100.0 | % | 416,740,478 | 100.0 | % | |||||
INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES | ||||||||||||||||||
OPERATING DATA | ||||||||||||||||||
TRADE VOLUMES: | ||||||||||||||||||
(in 000's, except %) | ||||||||||||||||||
Cleared | Non-Cleared | Avg. Trades | ||||||||||||||||
Customer | % | Customer | % | Principal | % | Total | % | per U.S. | ||||||||||
Period | Trades | Change | Trades | Change | Trades | Change | Trades | Change | Trading Day | |||||||||
2019 | 302,289 | 26,346 | 17,136 | 345,771 | 1,380 | |||||||||||||
2020 | 620,405 | 105% | 56,834 | 116% | 27,039 | 58% | 704,278 | 104% | 2,795 | |||||||||
2021 | 871,319 | 40% | 78,276 | 38% | 32,621 | 21% | 982,216 | 39% | 3,905 | |||||||||
4Q2020 | 178,614 | 17,008 | 7,455 | 203,077 | 3,223 | |||||||||||||
4Q2021 | 207,457 | 16% | 19,961 | 17% | 8,001 | 7% | 235,419 | 16% | 3,707 | |||||||||
3Q2021 | 193,218 | 18,106 | 8,228 | 219,552 | 3,431 | |||||||||||||
4Q2021 | 207,457 | 7% | 19,961 | 10% | 8,001 | (3%) | 235,419 | 7% | 3,707 | |||||||||
CONTRACT AND SHARE VOLUMES: | ||||||||||||
(in 000's, except %) | ||||||||||||
TOTAL | Options | % | Futures1 | % | Stocks | % | ||||||
Period | (contracts) | Change | (contracts) | Change | (shares) | Change | ||||||
2019 | 390,739 | 128,770 | 176,752,967 | |||||||||
2020 | 624,035 | 60% | 167,078 | 30% | 338,513,068 | 92% | ||||||
2021 | 887,849 | 42% | 154,866 | (7%) | 771,273,709 | 128% | ||||||
4Q2020 | 170,191 | 35,295 | 121,062,599 | |||||||||
4Q2021 | 244,349 | 44% | 41,997 | 19% | 117,410,095 | (3%) | ||||||
3Q2021 | 214,988 | 36,940 | 172,828,874 | |||||||||
4Q2021 | 244,349 | 14% | 41,997 | 14% | 117,410,095 | (32%) | ||||||
ALL CUSTOMERS | Options | % | Futures1 | % | Stocks | % | ||||||
Period | (contracts) | Change | (contracts) | Change | (shares) | Change | ||||||
2019 | 349,287 | 126,363 | 167,826,490 | |||||||||
2020 | 584,195 | 67% | 164,555 | 30% | 331,263,604 | 97% | ||||||
2021 | 852,169 | 46% | 152,787 | (7%) | 766,211,726 | 131% | ||||||
4Q2020 | 160,953 | 34,851 | 119,654,910 | |||||||||
4Q2021 | 235,400 | 46% | 41,318 | 19% | 116,546,652 | (3%) | ||||||
3Q2021 | 205,797 | 36,473 | 172,082,316 | |||||||||
4Q2021 | 235,400 | 14% | 41,318 | 13% | 116,546,652 | (32%) | ||||||
CLEARED CUSTOMERS | Options | % | Futures1 | % | Stocks | % | ||||||
Period | (contracts) | Change | (contracts) | Change | (shares) | Change | ||||||
2019 | 302,068 | 125,225 | 163,030,500 | |||||||||
2020 | 518,965 | 72% | 163,101 | ... | 320,376,365 | 97% | ||||||
2021 | 773,284 | 49% | 151,715 | (7%) | 752,720,070 | 135% | ||||||
4Q2020 | 144,378 | 34,459 | 116,538,527 | |||||||||
4Q2021 | ||||||||||||
