Exhibit 99.1
INTERACTIVE BROKERS GROUP, INC.
— — —
QUARTERLY FINANCIAL AND OPERATING DATA
FOR 2006 AND THE FIRST QUARTER OF 2007
1
INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES
OPERATING DATA
TRADE VOLUMES:
(in 000’s, except %)
|
|
|
|
|
|
|
|
|
|
|
|
|
| Average Trades |
|
|
| Market Making |
| % change over |
| Brokerage |
| % change over |
| Total |
| % change over |
| per US |
|
Period |
| Trades |
| prior period |
| trades |
| prior period |
| Trades |
| prior period |
| Trading Day |
|
1Q2006 |
| 15,185 |
|
|
| 15,434 |
|
|
| 30,619 |
|
|
| 494 |
|
2Q2006 |
| 16,497 |
| 9 | % | 16,861 |
| 9 | % | 33,358 |
| 9 | % | 529 |
|
3Q2006 |
| 16,952 |
| 3 | % | 15,095 |
| -10 | % | 32,047 |
| -4 | % | 509 |
|
4Q2006 |
| 17,409 |
| 3 | % | 16,677 |
| 10 | % | 34,086 |
| 6 | % | 541 |
|
1Q2007 |
| 22,844 |
| 31 | % | 20,010 |
| 20 | % | 42,854 |
| 26 | % | 703 |
|
CONTRACT AND SHARE VOLUMES:
(in 000’s, except %)
TOTAL |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Options |
| % change over |
| Futures* |
| % change over |
| Stocks |
| % change over |
|
Period |
| (contracts) |
| prior period |
| (contracts) |
| prior period |
| (shares) |
| prior period |
|
1Q2006 |
| 136,272 |
|
|
| 13,217 |
|
|
| 7,814,068 |
|
|
|
2Q2006 |
| 154,777 |
| 14 | % | 16,673 |
| 26 | % | 9,286,784 |
| 19 | % |
3Q2006 |
| 130,966 |
| -15 | % | 16,112 |
| -3 | % | 8,697,086 |
| -6 | % |
4Q2006 |
| 141,609 |
| 8 | % | 16,419 |
| 2 | % | 8,695,471 |
| 0 | % |
1Q2007 |
| 159,056 |
| 12 | % | 18,643 |
| 14 | % | 10,422,130 |
| 20 | % |
MARKET MAKING |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Options |
| % change over |
| Futures* |
| % change over |
| Stocks |
| % change over |
|
Period |
| (contracts) |
| prior period |
| (contracts) |
| prior period |
| (shares) |
| prior period |
|
1Q2006 |
| 89,704 |
|
|
| 3,097 |
|
|
| 4,645,467 |
|
|
|
2Q2006 |
| 104,348 |
| 16 | % | 4,233 |
| 37 | % | 6,059,452 |
| 30 | % |
3Q2006 |
| 85,760 |
| -18 | % | 3,949 |
| -7 | % | 5,268,608 |
| -13 | % |
4Q2006 |
| 92,118 |
| 7 | % | 3,540 |
| -10 | % | 5,206,850 |
| -1 | % |
1Q2007 |
| 99,603 |
| 8 | % | 3,586 |
| 1 | % | 5,978,287 |
| 15 | % |
BROKERAGE |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Options |
| % change over |
| Futures* |
| % change over |
| Stocks |
| % change over |
|
Period |
| (contracts) |
| prior period |
| (contracts) |
| prior period |
| (shares) |
| prior period |
|
1Q2006 |
| 46,568 |
|
|
| 10,120 |
|
|
| 3,168,601 |
|
|
|
2Q2006 |
| 50,429 |
| 8 | % | 12,440 |
| 23 | % | 3,227,332 |
| 2 | % |
3Q2006 |
| 45,206 |
| -10 | % | 12,163 |
| -2 | % | 3,428,478 |
| 6 | % |
4Q2006 |
| 49,491 |
| 9 | % | 12,879 |
| 6 | % | 3,488,621 |
| 2 | % |
1Q2007 |
| 59,453 |
| 20 | % | 15,057 |
| 17 | % | 4,443,843 |
| 27 | % |
* Includes options on futures
2
INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES
OPERATING DATA
ELECTRONIC BROKERAGE STATISTICS:
(in 000’s)
Period |
| Total |
| Customer |
| Cleared |
| Total Customer |
|
1Q2006 |
| 67 |
| $4,600,000 |
| 151 |
| 192 |
|
2Q2006 |
| 72 |
| $5,100,000 |
| 167 |
| 207 |
|
3Q2006 |
| 74 |
| $5,400,000 |
| 151 |
| 185 |
|
4Q2006 |
| 77 |
| $6,100,000 |
| 158 |
| 199 |
|
1Q2007 |
| 82 |
| $6,900,000 |
| 190 |
| 245 |
|
* End of period data
MARKET SHARE DATA
For exchange traded equity options
Period |
| U.S. Market Share |
| Global Market Share |
|
|
|
|
|
|
|
1Q2006 |
| 21.7 | % | 15.6 | % |
2Q2006 |
| 22.6 | % | 16.7 | % |
3Q2006 |
| 21.1 | % | 15.8 | % |
4Q2006 |
| 20.2 | % | 15.5 | % |
1Q2007 |
| 19.9 | % | 14.8 | % |
3
IBG LLC AND SUBSIDIARIES
SEGMENT FINANCIAL DATA
(UNAUDITED)
|
|
|
| 1Q2006 |
| 2Q2006 |
| 3Q2006 |
| 4Q2006 |
| 1Q2007 |
|
|
|
|
| (dollars in millions) |
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Market Making |
| Net revenues |
| $263.1 |
| $211.8 |
| $264.6 |
| $215.2 |
| $233.3 |
|
|
| Non-interest expenses |
| 68.5 |
| 77.3 |
| 71.3 |
| 74.8 |
| 79.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Income before income taxes |
| $194.6 |
| $134.5 |
| $193.3 |
| $140.4 |
| $154.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Electronic Brokerage |
| Net revenues |
| $65.2 |
| $76.2 |
| $75.4 |
| $81.6 |
| $94.5 |
|
|
| Non-interest expenses |
| 43.4 |
| 46.7 |
| 49.2 |
| 60.5 |
| 59.8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Income before income taxes |
| $21.8 |
| $29.5 |
| $26.2 |
| $21.1 |
| $34.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate |
| Net revenues |
| $0.3 |
| $2.8 |
| $(0.2 | ) | $(3.6 | ) | $3.0 |
|
|
| Non-interest expenses |
| 1.3 |
| 2.4 |
| (0.8 | ) | (3.8 | ) | 1.4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Income before income taxes |
| $(1.0 | ) | $0.4 |
| $0.6 |
| $0.2 |
| $1.6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
| Net revenues |
| $328.6 |
| $290.8 |
| $339.8 |
| $293.2 |
| $330.8 |
|
|
| Non-interest expenses |
| 113.2 |
| 126.4 |
| 119.7 |
| 131.5 |
| 140.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Income before income taxes |
| $215.4 |
| $164.4 |
| $220.1 |
| $161.7 |
| $190.3 |
|
Note: Presentation of Financial Data
On May 3, 2007, Interactive Brokers Group, Inc. (“IBG, Inc.”) priced its initial public offering (“IPO”) and purchased a 10.0% interest in IBG LLC. The historical financial statements for March 31, 2007 and prior periods set forth herein reflect the results of operations for IBG LLC and its subsidiaries, without giving effect to the IPO and related transactions. The pro forma effects of the IPO for the quarters in the period from January 1, 2006 through March 31, 2007 are separately set forth herein.
4
IBG LLC AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
|
| 1Q2006 |
| 2Q2006 |
| 3Q2006 |
| 4Q2006 |
| 1Q2007 |
| |||||
|
| (dollars in millions) |
| |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Revenues: |
|
|
|
|
|
|
|
|
|
|
| |||||
Trading gains |
| $ | 225.4 |
| $ | 176.2 |
| $ | 229.5 |
| $ | 174.0 |
| $ | 198.8 |
|
Commissions and execution fees |
| 39.4 |
| 45.8 |
| 42.8 |
| 46.4 |
| 56.3 |
| |||||
Interest income |
| 132.1 |
| 160.5 |
| 183.3 |
| 196.2 |
| 184.5 |
| |||||
Other income |
| 25.5 |
| 21.0 |
| 18.7 |
| 20.0 |
| 24.7 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Total revenues |
| 422.4 |
| 403.5 |
| 474.3 |
| 436.6 |
| 464.3 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Interest expense |
| 93.8 |
| 112.7 |
| 134.5 |
| 143.4 |
| 133.5 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Total net revenues |
| 328.6 |
| 290.8 |
| 339.8 |
| 293.2 |
| 330.8 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Non-interest expenses: |
|
|
|
|
|
|
|
|
|
|
| |||||
Execution and clearing |
| 71.3 |
| 82.8 |
| 76.7 |
| 82.5 |
| 90.2 |
| |||||
Employee compensation and benefits |
| 28.7 |
| 27.1 |
| 28.3 |
| 26.0 |
| 32.8 |
| |||||
Occupancy, depreciation and amortization |
| 5.5 |
| 6.2 |
| 5.1 |
| 5.9 |
| 6.0 |
| |||||
Communications |
| 2.7 |
| 3.2 |
| 3.2 |
| 3.5 |
| 3.4 |
| |||||
General and administrative |
| 5.0 |
| 7.1 |
| 6.4 |
| 13.6 |
| 8.1 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Total non-interest expenses |
| 113.2 |
| 126.4 |
| 119.7 |
| 131.5 |
| 140.5 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Income before income tax |
| 215.4 |
| 164.4 |
| 220.1 |
| 161.7 |
| 190.3 |
| |||||
Income tax expense |
| 9.2 |
| 6.6 |
| 5.8 |
| 5.8 |
| 6.1 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Net Income |
| $ | 206.2 |
| $ | 157.8 |
| $ | 214.3 |
| $ | 155.9 |
| $ | 184.2 |
|
5
IBG LLC AND SUBSIDIARIES
MARKET MAKING STATEMENTS OF INCOME
(UNAUDITED)
|
| 1Q2006 |
| 2Q2006 |
| 3Q2006 |
| 4Q2006 |
| 1Q2007 |
| |||||
|
| (dollars in millions) |
| |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Revenues: |
|
|
|
|
|
|
|
|
|
|
| |||||
Trading gains |
| $ | 225.7 |
| $ | 173.8 |
| $ | 229.8 |
| $ | 178.4 |
| $ | 193.5 |
|
Interest income |
| 103.2 |
| 122.8 |
| 138.7 |
| 143.5 |
| 130.7 |
| |||||
Other income |
| 9.6 |
| 3.9 |
| 2.2 |
| 2.9 |
| 6.2 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Total revenues |
| 338.5 |
| 300.5 |
| 370.7 |
| 324.8 |
| 330.4 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Interest expense |
| 75.4 |
| 88.7 |
| 106.1 |
| 109.6 |
| 97.1 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Total net revenues |
| 263.1 |
| 211.8 |
| 264.6 |
| 215.2 |
| 233.3 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Non-interest expenses: |
|
|
|
|
|
|
|
|
|
|
| |||||
Execution and clearing |
| 45.1 |
| 54.4 |
| 47.1 |
| 51.5 |
| 53.1 |
| |||||
Employee compensation and benefits |
| 13.7 |
| 12.4 |
| 13.4 |
| 7.8 |
| 13.7 |
| |||||
Occupancy, depreciation and amortization |
| 2.7 |
| 3.0 |
| 2.1 |
| 2.8 |
| 2.7 |
| |||||
Communications |
| 1.5 |
| 1.6 |
| 1.7 |
| 1.8 |
| 1.7 |
| |||||
General and administrative |
| 5.5 |
| 5.9 |
| 7.0 |
| 10.9 |
| 8.1 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Total non-interest expenses |
| 68.5 |
| 77.3 |
| 71.3 |
| 74.8 |
| 79.3 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Income before income tax |
| 194.6 |
| 134.5 |
| 193.3 |
| 140.4 |
| 154.0 |
| |||||
Income tax expense |
| 8.5 |
| 5.9 |
| 5.4 |
| 5.1 |
| 5.5 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Net Income |
| $ | 186.1 |
| $ | 128.6 |
| $ | 187.9 |
| $ | 135.3 |
| $ | 148.5 |
|
6
IBG LLC AND SUBSIDIARIES
ELECTRONIC BROKERAGE STATEMENTS OF INCOME
(UNAUDITED)
|
| 1Q2006 |
| 2Q2006 |
| 3Q2006 |
| 4Q2006 |
| 1Q2007 |
| |||||
|
| (dollars in millions) |
| |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Revenues: |
|
|
|
|
|
|
|
|
|
|
| |||||
Commissions and execution fees |
| $ | 39.4 |
| $ | 45.8 |
| $ | 42.8 |
| $ | 46.5 |
| $ | 56.3 |
|
Interest income |
| 29.7 |
| 38.5 |
| 45.8 |
| 53.3 |
| 59.8 |
| |||||
Other income |
| 16.2 |
| 17.7 |
| 17.9 |
| 18.2 |
| 20.0 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Total revenues |
| 85.3 |
| 102.0 |
| 106.5 |
| 118.0 |
| 136.1 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Interest expense |
| 20.1 |
| 25.8 |
| 31.1 |
| 36.4 |
| 41.6 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Total net revenues |
| 65.2 |
| 76.2 |
| 75.4 |
| 81.6 |
| 94.5 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Non-interest expenses: |
|
|
|
|
|
|
|
|
|
|
| |||||
Execution and clearing |
| 26.2 |
| 28.4 |
| 29.7 |
| 31.1 |
| 37.1 |
| |||||
Employee compensation and benefits |
| 7.0 |
| 6.7 |
| 7.1 |
| 8.0 |
| 9.2 |
| |||||
Occupancy, depreciation and amortization |
| 1.3 |
| 1.6 |
| 1.4 |
| 1.5 |
| 1.4 |
| |||||
Communications |
| 1.2 |
| 1.5 |
| 1.6 |
| 1.7 |
| 1.7 |
| |||||
General and administrative |
| 7.7 |
| 8.5 |
| 9.4 |
| 18.2 |
| 10.4 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Total non-interest expenses |
| 43.4 |
| 46.7 |
| 49.2 |
| 60.5 |
| 59.8 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Income before income tax |
| 21.8 |
| 29.5 |
| 26.2 |
| 21.1 |
| 34.7 |
| |||||
Income tax expense |
| 0.5 |
| 0.5 |
| 0.2 |
| 0.5 |
| 0.4 |
| |||||
|
|
|
|
|
|
|
|
|
|
|
| |||||
Net Income |
| $ | 21.3 |
| $ | 29.0 |
| $ | 26.0 |
| $ | 20.6 |
| $ | 34.3 |
|
7
INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES
PRO FORMA CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
|
|
|
| 1Q2006 |
| 2Q2006 |
| 3Q2006 |
| 4Q2006 |
| 1Q2007 |
|
|
|
|
| (dollars in millions, except share and per share data) |
| ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Trading gains |
|
|
| $225.4 |
| $176.2 |
| $229.5 |
| $174.0 |
| $198.8 |
|
Commissions and execution fees |
|
|
| 39.4 |
| 45.8 |
| 42.8 |
| 46.4 |
| 56.3 |
|
Interest income |
|
|
| 132.1 |
| 160.5 |
| 183.3 |
| 196.2 |
| 184.5 |
|
Other income |
|
|
| 25.5 |
| 21.0 |
| 18.7 |
| 20.0 |
| 24.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues |
|
|
| 422.4 |
| 403.5 |
| 474.3 |
| 436.6 |
| 464.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
|
| 93.8 |
| 112.7 |
| 134.5 |
| 143.4 |
| 133.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total net revenues |
|
|
| 328.6 |
| 290.8 |
| 339.8 |
| 293.2 |
| 330.8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Execution and clearing |
|
|
| 71.3 |
| 82.8 |
| 76.7 |
| 82.5 |
| 90.2 |
|
Employee compensation and benefits |
|
|
| 28.7 |
| 27.1 |
| 28.3 |
| 26.0 |
| 32.8 |
|
Occupancy, depreciation and amortization |
|
|
| 5.5 |
| 6.2 |
| 5.1 |
| 5.9 |
| 6.0 |
|
Communications |
|
|
| 2.7 |
| 3.2 |
| 3.2 |
| 3.5 |
| 3.4 |
|
General and administrative (1) |
|
|
| 5.0 |
| 7.1 |
| 6.4 |
| 13.8 |
| 8.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total non-interest expenses |
|
|
| 113.2 |
| 126.4 |
| 119.7 |
| 131.7 |
| 140.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income tax |
|
|
| 215.4 |
| 164.4 |
| 220.1 |
| 161.5 |
| 190.3 |
|
Income tax expense (2),(3) |
|
|
| 16.0 |
| 12.4 |
| 12.8 |
| 11.0 |
| 12.0 |
|
Less — Minority interest (4) |
|
|
| (185.6 | ) | (142.0 | ) | (192.8 | ) | (140.4 | ) | (165.9 | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
|
| $13.8 |
| $10.0 |
| $14.5 |
| $10.1 |
| $12.4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share (5): |
| Shares |
|
|
|
|
|
|
|
|
|
|
|
Basic |
| 40,000,100 |
| $0.34 |
| $0.25 |
| $0.36 |
| $0.26 |
| $0.31 |
|
Diluted |
| 401,240,827 |
| $0.34 |
| $0.25 |
| $0.36 |
| $0.26 |
| $0.31 |
|
See accompanying notes to unaudited pro forma consolidated statements of income.
8
INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES
NOTES TO PRO FORMA CONSOLIDATED STATEMENTS OF INCOME
The pro forma consolidated statements of income of IBG, Inc. and subsidiaries are comprised of the historical consolidated statements of income of IBG LLC and subsidiaries adjusted to reflect the following items and transactions, as if such transactions had occurred as of January 1, 2006:
(1) Gives effect to Delaware franchise taxes that will be payable, estimated at $0.165 million annually.
(2) Pro forma income tax expense includes income tax expense adjustments comprised of the sum of current income tax expense adjustments for these periods (referenced in this footnote 2) and deferred income tax expense adjustments for these periods (referenced in footnote 3 below). Additional current income tax expense on our 10.0% investment in IBG LLC would have been $2.7, $1.6, $2.8, $1.1 and $1.8 million, respectively, for each of the three months from the period ended March 31, 2006 through the period ended March 31, 2007. In addition to increased currently payable income taxes, we would have incurred increased deferred income tax expense (see footnote 3).
(3) Pro forma income tax expense includes additional deferred income tax expense of $4.1 million for each of the three month periods reported, which expense is the result of the straight-line amortization of the deferred tax asset of $249.3 million arising from the acquisition of the 10.0% member interest in IBG LLC (see footnote 2 above). This deferred tax asset will be amortized over 15 years.
(4) Gives effect to the 90.0% interest in IBG LLC that IBG Holdings LLC has after the IPO and the Recapitalization transactions consummated in connection with the IPO. The adjustments are equal to 90.0% of IBG LLC’s total net income for each of the periods reported.
(5) Basic pro forma earnings per share are calculated based on the estimated 40.0 million shares of Class A common stock and 100 shares of Class B common stock being outstanding. Diluted earnings per share are calculated based on an assumed purchase of all remaining IBG LLC membership interests held by IBG Holdings LLC and the issuance of a corresponding number of shares of Class A common stock, resulting in a total of 400.0 million shares deemed outstanding as of the beginning of each period. There is no impact on earnings per share for such purchase and issuance because 100% of net income before minority interest would be available to common stockholders as IBG Holdings LLC would no longer hold a minority interest, and the full difference between the book and tax basis of IBG LLC's assets would also be available for reducing income tax expense. Net income utilized to calculate diluted earnings per share would have been $138, $100, $145, $104 and $124 million, respectively, for each of the three months from the period ended March 31, 2006 through the period ended March 31, 2007.
In addition, diluted weighted average common shares outstanding include 1.2 million shares of Class A common stock to be issued upon investment of accumulated earnings on return on investment dollar units in connection with the Recapitalization transactions consummated in connection with the IPO. Shares of Class A common stock to be issued in connection with the employee incentive plan have been excluded from diluted weighted average common shares outstanding because such shares are non-dilutive.
9