Virtu Financial, Inc. Q1 FY2021 Earnings Call

· Earnings call transcript and AI-powered summary

  • Adjusted Net Trading Income (ANTI): $728 million, down 7% year-over-year (YoY) from Q1 2020 but up 60% over Q4 2020.
  • Market Making ANTI: $575 million ($9.4 million/day), 10% lower than Q1 2020, but 88% higher than Q4 2020. Provided $470 million in price improvement to retail investors.
  • Execution Services ANTI: Record $153 million ($2.5 million/day), a 19% YoY increase.
  • Adjusted EPS: $2.04, nearly flat YoY and up from $1.18 in Q4 2020.
  • Adjusted EBITDA: $565 million, down 1% YoY and up 64% from Q4 2020.
  • Adjusted EBITDA Margin: Record 77.6%.
  • Dividend: Maintained at $0.24 per share (unchanged since IPO in 2015).
  • Share Buybacks: Increased authorization by $300 million to a total of $470 million. Repurchased $151 million (~5.4 million shares at avg. $27.37) since November 2020.
  • Capital Efficiency: Return on invested capital reached 100% in 2020, reflecting Virtu's scalable, low-capex model.
  • Leverage: Debt-to-EBITDA ratio at 1.0x as of March 31, 2021.

Business Highlights

  • Execution Services Business: Two years post-ITG acquisition, saw 26% CAGR; enhanced client experience and significantly improved margins.

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Operator: Good day and welcome to the Virtu Financial 2021 First Quarter Results Call. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Andrew Smith. Please go ahead. Andrew Smith: Thank you, Grant and good morning. Thanks for joining us everyone. Our first quarter results were released this morning and are available on our website. On this morning's call, we have Mr. Douglas Cifu, our CEO; and Mr. Joe Molluso, our Co-President and Chief Operating Officer; and Mr. Sean Galvin, our Chief Financial Officer. They will begin with prepared remarks and then take your questions. First a few reminders, today's call may include forward-looking statements, which represent Virtu's current belief regarding future events and therefore, subject to risks, assumptions and uncertainties, which maybe outside the company's control. Please note that our actual results and financial conditions may differ materially from what's indicated in these forward-looking statements. It's important to note that any forward-looking statements made on this call are based on information presently available to the company and we do not undertake to update or revise any forward-looking statements as new information becomes available. We refer you to the disclaimers in our press release and encourage you to review the description of risk factors contained in our Annual Report and Form 10-K and other public filings. During today's call, in addition t

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