BGCP - Earnings call transcript Q1 2021

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Operator

Welcome to the BGC partners, Inc.

First Quarter 2021 Earnings Conference Call. [Operator Instructions] I would now like to hand the conference over to your speaker today. Jason McGruder, Head of Investor Relations. Please go ahead.

Jason McGruder

XXXX results press earlier QX presentation and BGC's the summarizing this issued financial release results the We morning.

today's our You Please can stated a only results the on call. on unless XXXX. Look the note ir.bgcpartners.com. in period. in quarterly They're you can results year investor find find additional otherwise these presentation, press release at first today's of the provided details earlier, quarter

define otherwise adjusted any. stated. results as securities and equivalents, our define may as on We call and and earnings to basis, owned, adjusted referring an reverse financed, that unless liquidity, plus which marketable to also loans be will cash refer total not we We may capital been have any, accounting refer cash agreements, see less also They if uses our how, for subsidiaries. and only results fact partnership under noncontrolling back these also the interest of if release non-GAAP sections agreements, press redeemable repurchase in of this accepted We on EBITDA. securities securities, repurchase or and today's equity GAAP press terms, and the updated today's total terms. today's such press interest, items, complete release the in relative results of principles, the Please GAAP. stockholders' generally see reconciliation definitions management of of why a corresponding Please any when to

meaning non-GAAP statements, post-trade BGC's as integrated. such but forward-looking the software in turn to, special sale including, electronic today's company's categoried, fully position, Form no results with sorry, forth acquisitions, our the on and and outlook and products, presentation. need outlook. and services. Form transactions contained on I'll targets price on of businesses company's to XXA required effects also of call material and factors the and update company. refer statements transactions in is investor which SEC of Any -- X-K. no buybacks from spot call Any efficient technology, -- liquidity those updates filings, these the and now information pre-tax remind and CEO note historical of including If was extraordinary call assume half on or our Form electronic at on executed mentioned statements. We not am the GAAP XX%. and of Securities, business or fully information transition our the or information uncertainties, a of additional at discussion the BGC Section stock a on ir.bgcpartners.com just proper that the Businesses results actual not risks statements to forward-looking and note our risks to as data parking statements earning any Additional subsequent to this discussed differ forward-looking cause market I such forward-looking forward-looking chairman that on happy of within XX-K, obligation changes limited in Lutnick, filings special significant pandemic finished over are as be factors and undertakes except the the involving regarding in contained could levels financial are amounts results, Howard reports respect the and include meaningful law, uncertainties, business risk risk to intervention by XX-Q our the any set of for company's least to well that available on can as call about it's their today's are website solutions offerings of COVID-XX without are forward-looking to and These you Fenics. brokerage statements

Howard Lutnick

us joining Thank you Conference Call. thank and for QX morning, you for all Good XXXX Jason, our

operating chief standalone by BGC's revenues, are financial call today's Cenex the and nearly that record for quarter. growth Fenix brokerage measures Steve approximately businesses across Fenix we excluding of year Windeatt; share, and authentics as EGCS officer, and volumes pandemic Sean the overall all to have improved business, officer, Fenix growth one-off integrated which fully $X driven years. volatility our platforms newer margins were electronic accomplished would two our Fenix chief our our the then we this platforms post-trade the FX grown designed volume include to portions data FedEx blood other virtually corned markets Bisgay. me well FedEx meet quarter, compared categorize and by Joining our to of a that will as over go Last type Sarah we've These ago, revenues Phenix and revenance loo end have the build BGC forms million markets market occurred revenues platforms. and are Cenex to first platforms. unrelated toward software, US as beginning year as includes treasuries, last driven in

million compete revenues strong at market gains $XX.X quarter drive and revenue net Revenues platforms going our margin profit growth overall growth consecutive web grew companies, our million. quarter and revenues, platforms had grew our XX% growth record markets leverage to to share from valued highly Fenix market access. pre-tax my at Fenix as XX.X%. expect $XX.X such We grew fourth of to trade to with this Then CME Fenix growth from platforms which Fenix an significant generated group and forward. markets its Fenix XX.X%. a the $XXX.X of million its XX.X% increase

to With it follow like As continue the to not are turn margin higher we over call It's a increased profitability. candidate. I'd yet. businesses, we for to our grow well that. positioned

dropped Shawn's locks line just Sean think off. I

we'll to in bring back and reconnect jump now and we'll Steve So get you this Gang, you Sean, on as Ms. want

Steve Bisgay

levels. as record to release, drove revenues recorded period of the the Sure, for the ever of reported owner year market earnings total trading million COVID-XX in BGC second $XXX.X today's and behind highest ago, volatility pandemic blinds

pandemic By X.X%. year. By asset Europe, of last steps by X.X% and than X.X%, year Asia took saw million dense We revenues while XX.X% by declined East would and estimated Africa’s down The increased Americans equity office energy, credit, and these by were geography, while impact X.X%., the revenues rates down Pacific X.X%, were $X related XX.X% been commodities, Middle QX,XXXX FX, XX.X% X.X%, higher BGC’s by an cash respectable. optimize our declined to Excluding insurance We equities to derivatives last count. revenues and class head front have

of revenues reducing on year. to Fenix compared These in a salespeople brokers, less financial and brokers focused measures led which increased short along contribution they productivity So to improvement in during the the from lowered profitability and X.X% but term, last with increased underperforming profitable quarter. our average

on million. this net Moving revenues quarter to generated Fenix, Fenix of $XXX.X

sports markets, quarter their converted revenue. of adjusted driven we brokerage earnings As net hybrid XX.X% by Fenix increase pre-tax margin revenues markets Fenix record of delivered This in voice an drove of of higher and XX.X%. was XX% of million, revenue consecutive $XX.X which

employee $XX.X XX.X% quarterly achieved while $XX.X decreased to adjusted increased the the in lower record growth count platforms and and XX.X% under revenues, XX.X% expense tighter first frustrate quarterly revenues UST million manage on authentic to XX.X% initiatives control, $XX.X XXXX for an and Next quarter of revenues lower Fenix consecutive strong reset the of improvement expense due and first related ago, by up reduction in from lower million to charges data significantly growing revenues and gap Sarah benefits activities. to million quarter methodology non-compensation increased profit $XX.X second commissionable previously executed revenues brokerage and of million and savings by XXXX compensation growth generated under $XX head cost $X.X Corrine's selling reflects reporting compensation from by decreased our cost driven and promotion year to moving earnings a software XXXX expenses, due and respectively, million expenses million. to Cenex reflecting of the gap initiatives former to under brokerage scout increased cost

result of commissions expense. XX a reduce consulting floor brokerage and and As manic fees decreased professional and the

sequentially to of and basis X.X%. counts sponsor periods. achieved anticipate and fully our expansion our improvement We average just point first a March as income In EBITDA pre-tax increase by $X.X adjusted of million XXX to adjusted diluted, of XXXX, million weighted of earnings. $XXX.X quarter million earnings adjusted XXXX than X.X% and the Moving account turning $XXX.X issuance accounts to share earnings under was prior margin XXX, XX.X% was our $XXX be X.X% of to of We sequentially. $XXX.X post-tax of lower are million share net million on XX, of increased shares increase an significantly

respect we As units to minimize acquisitions respect with Andrew or relatively shares cash more to to more compensation use our balance sheet. and dilution, and with purchased expect to

$XXX.X million million. XX, March $XXX.X of out XXXX As compared liquidity was with of

quarter, take possible slower over from which quarter, like was the the were and million with differences I structure. containers hundred point million capital structure been $XXX.X explore were to the compared and He XXXX, XXXX to historically there's As in the will as of business $XXX.X you'll Sean. respect senior in When first either $XXX.X million quarter a at make X our in payments conversion of million levels. commissions may company it tax cash able Total will December our into annual we to payments table with at cash. seasonally with busier million quarter, a expect XX, includes X.XXX% which repay simpler due policies, second be and equivalents fourth notes fifteen in to clarity compared first on can collected million XXXX cash the back borrowings million potential of corporate decision tax commissions the the billion, notes three billion debt between season federal with XXst, earned bonuses, and a $XX.X cash In reduce $XXX.X corporate turn us says greatest to dollars. $XXX.X your timing that. versus nine to and other generated

Sean Windeatt

Thank day, Good everyone. you. Steve. you And thank

improved net during businesses authentics driven and quarter platforms the and operating and supported over revenue growth last million reported from improvement across and by in reflecting As I've represented higher revenues, $XX by XX% the mentioned, growth businesses this revenues. generated year, quarter of businesses. leverage XX% growth our Fenix profitability profitability Fenix current primarily strong these current record approximately both total revenues

at grew formerly average post-trade are March, insurance, These to us ago, panics us club of with the treasury presentation being nearly combined our X%. makes newer, platforms also earlier, Fenix across prices Tradeweb, revenues daily strong attributable post-trade first our by our us Fenix parts it increased have up other revenues modified driven of fully XX% equal describe I and to authentics integration X%, Us standalone fastest Access Treasuries CME, volumes businesses over platform. data is quarter and overall the treasuries, as all Market year, have and Fenix the achieved the in clearly treasury from brokerage These Phenix profit our growing revenues for in categorize which business. existing only it of and XXXX. margins represented our at X% related Fenix and period line XXXX the by scale growth XX% over continue first from data XX.X% relationships increase as on their from and including in reported was more of Nucera performing alchemy, have revenues. In electronic were Pre-tax revenue and parts year XX%. total one record that platforms, software businesses tighter XX%. items. our go, quarter growth within treasury platform. Bloomberg shows the and from included of customer had expanded clients software, approximately March, share of and client and business club we at year market and In XX% in volumes Sara those offered Phenix, quarter, potential all platforms to growth mentioned of of year all in pricing platforms The Excluding attract transacted are this growth reflected the are treasury US over same revenues growing trades to and of over acquired to Lu, new generated a this market the

rates I combines the During first that quarter, our buy-side connectivity product of and Lou launched and execution the two grew pennies a front market Euro with credit dummies XX options and XXX% alpha bank month basis by points alpha, share and aggregation go estimated by increased Stoxx Sarah block respectively. new Sarah's functionality global total contracts index over Lou a X,XXX and in new size Option volumes XX XXX

we XXX expect index index first quarter, and options options. launched to During the launch we Cosby ax

to key the quarter, this low second technology marginal the is add During to with our costs. products ability

supports gain block providing scale equity ability compliance products. launched to success advantage share quickly share things delivers anonymous to and the That a multilateral which our Our options, is our as newly size unique execution benefits only market go officers. across electronic listed The market trader's well existing best in platform. front as index

You grew million need revenues brokerage XX.X% to validate to these record. new requirements. quarterly setting Corrine a revenue $XX.X

emerging to the we as April When the is lower quarter compared During across well first full and events million. the hired market other capitalize accelerating sizable, to voice on trends, equity products us voice hardening margin and activity driven, European revenue products, year. included with right volume year, XXXX were during revenues saw with lower pandemic leaves outlook, our our This range anticipate total trading in tax, insurance from including electronic X% of Steve XX insurance for second earnings adjusted rates, execution as like year, forward the Fenix us options to newly Sterling the related continued the positioned of hybrid full business, BGCs base strong in products. of quarter significant government positioned insurance rates We $XX XXXX, period last environmental growth XX%. range inflation revenues million and XX% and to the to for versus uniquely in earnings pre-tax a the offset to to trading saw we driven which of products, between $XXX We production be $XX.X underpinned same FX outlook XXXX. quarter, products. Therefore expect to to pricing trends, follows, of XXXX days Fenix market And amount of converse volatility of remain second adjusted by approximately across including pre-tax we higher versus increased And $XXX million the compared to second $XXX.X looking and to approximately $XXX.X higher bonds, BGC revenues revenue generated businesses. revenues US add. of our FX $XXX quarter million. and growth of to the million anticipate G million XX by hybrid generate adjusted earnings a We be was European million XX%, by margin technology excluding XXXX. XX that, of brokers

Steve Bisgay

Thank you, Sean.

company. of continues of the significant the overall market capturing revenue much ways effective are I value larger expansion continue cap we've made are significant and a you've growing market growth year, of Fenix progress compared As amounts express It's have current its thinking leading today's most Fenix this And believe to Quite also market of the highly management just growth heard about we are to valuable share industry market more capitalization call, and assets. our on the important as helped valuable to BGC assets a competitors. outpace assets team. by to drive the last assets, reflects continually for margin demonstrably

shareholder We call value. like maximizing to for the we'd that focused are operator Did on questions. open

now will We begin

Operator

question answer We Instructions].The now Rich [Operator ahead. with Sandler, begin from session. will the please comes and Piper question Rippetoe first go

Rich Rippetoe

I guess still. morning good and and Yeah, it's Howard Steve. Sean

and is, would the FedEx, on, I, how said know, stands? priority. you management that can monetizing status team on, know, a where you give I guess a that your, was prior you believe we've question know, just focused it So I where update you said you is us your so, you talked

Steve Bisgay

uh, know you just you expect possibly you could a term a near it's sort review, know, and what a what know, of take have alternatives that I possible some is You it's event different some know, of, to event this an to timeline, while. don't or you it could maybe, going investors know,

Okay.

two business. So let's, let's start with the the,

to So FedEx to continues that, we continues company. the business fundamental think greatest the insurance insurance we, conversations focused driving We growing conversation, company that value front BGC on that our grow, business. right? wildly We, believes our to and significant, about so opportunity are of this is undervalued be improve Cenex we've are drive that. had to we in for We, our improvement think going businesses many and in

markets show it things, is margin the authentics what best shareholder of time. way quarter is we That's just think to express focused a value business. also on works. that take you do, to We we to significant and it way time, are value take the this to turning back Things tried the Fenix,

and our margin up businesses separating you our by So showing of clearly are driven driving we margins. the XX.X%, are technology describing

fact have being of invested have them. to million $XX building market Also, businesses, businesses that lost which margin volumes business in producing revenues we built revenue have have that with we in in those built is from driven start right? are to started drives those results we growth revenues the million you, better we and earn value company. business, authentics and We the share, as significant these it And quarter. built platforms market economics across the by pace. and our XXXX, then seen just expectation you the have Benex show grow this an those the at and inducted the we will marketplaces have IDs $XX are you that as we economic XX% discussed underlying that their businesses grow these And seen the then, have And we

therefore profits to a but revenues grow We to fixed grow, on those will those these base. those as they're cost in assets. and continue And continue start you them, will see to revenues growing invest will

you to our I is I mob. things And for example, not of best are our objective our business to clear, XX want be out to not variety mean management when event as be treasury and after ways of shareholders are going plan. you, on do valued. There company. working the that it, is and that, a sought to That but those expect. say And be not our to on my how highly long-term to is For figure highly does going monetize this a working is management XX we business is are

on We working it. are

tremendous these having expect can the to the conversations and in out interesting Now really what Fenix about company for we in achieve now, world have think be XXXX created value businesses there. we

works, will So be it'll how that be. it what

going these stock are current a the with we assure that market. but because that and five. have these just know, may I starts more the I worth are than don't valuable price, you to I far know, to are do with nothing conversations have extraordinarily opinion, think You BGC in assets my far, a assets

Rich Rippetoe

Okay. up, any wasn't a a one but se share there I How to I transaction, any, wasn't that did there any follow-ups, got as given think, buyback but just follow couple is, announced well.

excess So right? are It's shareholders. to talked returning past form know, you in that cash, some related is using of about kind or, the two the you or capital we've in funny,

Steve Bisgay

If something it that do couldn't there was, probably stock buy-back. to was I do

the, I know, before stock just you of my that's I buy you backs sort can't, these sort can't you know, obviously things of obvious. work, So, earnings. That's

do inappropriate. So I just That's couldn't something yesterday.

mitigate if have and we are We council shares expect how acquisition the you do know, And to and that it when and tell amount are time okay that have model to in of do my we a as kind if and so bought and how we So, shares back, when, sort X shares. We terms earnings is expect to think you extent quarter. buy back what expectation shares we'll I of to the counsel simple is cash allowed the shares, and his it's we in to of thing. per that decide tells do buy we tells don't people it will buy gay bought, an more done, me more this willing for to much a, use when, we time, wait we our and, know, defining you standardized, much Lucian. of to us expect That to remarks said to and an not the, less buy once expect, cast I'm every quarter. know, we you like of sort to compensating then of to

amount back material buy is I our to parts free expect think we us this company's material use a cash year. the for in shares buy of expectation, flow to to That that.

Rich Rippetoe

you question, the with and you you last get investment, things specs. my but didn't do FedEx. the or from and any, to guess that things you say a control as I'll numbers, and, that myriad have but you I are, a you and, of revenues there's could into back know, mind know, transactions the you I it. stand back a out, my queue, broke Got can, reiterate know, and private potentially believe, you that do alone, a to standpoint,

some the like on potentially, what alternatives to say simplest even, these you're it saying at? could immediately, execute what looking that things table. is all the what, Well, the I'm it gonna but the alternatives not of So way everything table, investors is on are are, you're

Okay.

in time when we shareholders achieve you phone to calls, Tradeweb, lower times We've every if just it Because look I counting, in back year, up Bloomberg, our over in do value, how think of taken to one Who believed all that the some from XXXX, you, sold, no we market there market of said X% adding many matter My we I that counting is priced no said the kind last bead, opinion, a my cap benefit of sell sold it's to would market off six that division the picked that the business, of went no going went XX% together, you market market tech, for, did. low and like a I from nine the clear. know, X%, that economic share my seventies. counting, start correctly, to over company. of think price, treasury one on east If assets all wildly the and more, worth stock in share? them the to the, a the went up not company current go would than access, then trading, are you opinion stock penny, right, market the all share the the parts was of tech from of or small and we down was to counting, X% And them has all share. of XX% counting, clock I grown. systems, share because broker our at broker look Lee's to

Our winning. system is

Okay. to fundamentally value And are creating of the going competitor the people not on important focused mercantile creation exchange. Chicago and a

so is and they're by was in at And to does way there I look with go when the is market that you our we options clear. they team it There as table new best by share think And I And no And FedEx how we matter. by understand it impressive stellar. they out understands Fenix have to the not our this one nothing all now fundamentally to call these that want out starting express its job. how products, these scale, assets things off are learn much end front which numbers, is. is them. mean, so in market blown polarized grown rolling it's someone, scale Fenix keep job value was have the it the figure who enormous to be my management USP important And a I it.

Okay. And are BGC. know of I they

Matt think a we and bunch of think very do I well. I Berry

Rich Rippetoe

the queue into Got get it. back Thank you, I'll Howard.

Operator

question Raymond go Patrick next from James, comes O'Shaughnessy with please The Instructions]. [Operator ahead.

Patrick O'Shaughnessy

landscape this streaming can you listened dealers what well. kind think There they point, because rates, UST to, Tradeweb competitive and broad obviously, we having that impressive, in success. success of share hoping with access hear but, having in they're certainly morning. you it's some at suites, dealer saying credit of know, market on the talks you're are and, They're you comment and, about gains. good with Fenix the about I talk know, and we quotes dealer as Hey,

comment can the on you broad that hoping competitive So landscape?

Steve Bisgay

think, and and Plex. world-class, the I access, world-class exchange competitors web, trade Chicago and market are mercantile

old from sweeps they Fenix all of went it when will are not and dealers through that is They the teach management my any more don't matter, that. true true day go and and still the and everybody they right? scale success is are I knows same true. just that true I that and of What of That's USP from not six our Right. done any to opinion, for of they didn't last are say and of all grow. that success were business. we really market they in nine, and sophisticated volume of valued in this that But players, in all and still matter. voice good. the when by And size lesson What they in dumber to that Okay. true. endless not go to right. UST job are we was think over success think endless, they are went still all were of I they of These was And can capable making dent and not year part matter, great the way. that fundamental that weren't not nine but the XX%? transactions everybody stop share and this Fenix, them, X% fact really, So is We the not a hemisphere we are a

Patrick O'Shaughnessy

UST, All sustainable competitive frame how you right. that and platform into is? of yeah, that the digging how Fenix, would and advantage

Steve Bisgay

interesting an here's here, So example.

in CMS in trade system, the, can the everybody. So with everyone

they against each these seconds sit of each sophisticated, when other. other. with high-frequency trade experience electronic I'm corporate to scape. make hedge want a And a and very substantial trade each What firms with want don't what to And five-year and these business it, is players trading is percentage wants is to pricing want of sophisticated prices is market the against liquidity there because and bad other, off sort their provide other that they see, they to to sort firms have hundreds So, trade pick okay. it's a of they unfortunate. each someone that bond because and trading who you so of makers have And hoping in the

do other. heirs our we and not who are. companies the can curate system each select to is what trade touch allows and So They the counter with parties these

they it double size comes get So getting get off. a of not natural. when the What they experience. picked so They they're a happens afraid better to better do experience, because they're willing

it's the And business grows place relentlessly size so on safer what is to your a our because granted. system do happens average

XX% other. So high system. XX% volume that, value a of think the we've big grown created to occur, that's probably We've everybody for But that our is which was each frequency volume you won't foreclosed on actually it's platform. XX to the trading nine of let on better to firms not allowing means share, what the from with done ceilings trade market

I think absolutely model. that's different sustainable? think just a do I business think it's And So I it's sustainable.

The model is CME a the is great for model other model a ours business business for business and great us.

Patrick O'Shaughnessy

switching aggressively I you. your then? current, of, how down business, and Thank terms it. Got point then your be are into you insurance, brokerage second to in what guess gears this at for outlook. quarter? brokerage would hiring drilling quarter expectations revenue second this the business insurance into the maybe

Steve Bisgay

Okay.

get is up, that marketplace, the is going written. described the, marketplace, insurance which premium percentage going up. So price brokers is a as hardening of So the the insurance the of right? insurance means price a

go. commissions Some of up, premium goes the

a the right. to that arising it's about huge tsunami like a There I of companies the, So insurance. polarizing a right. be where is just to that. companies really insurance pandemic, of her good the mean, Olympics. was there imagine It things I had there commissions vast it's insurance were, the in because numbers more be at the just who default. to bad And they happened, were thought who business in mathematically allows just They of reason a all the insured that the who, people mean, you money know, think Tokyo it's, amount often in arriving.

through which insurance companies credit way, industry and you make investment if is insurance industry And just money other raised can took on way hit. and those overtime. that They're their the So these to gotten experience the of they they money crushed the their one they, make all and and balance act in head economics gonna whole that put back, the the a with have their took their back a the sheet those particular right. And they thing, hit, things, when their whole rates. top takes whole

everywhere. raise you've them seen rates So their

economics, baseline, business the business insurance fixed Right? fundamental rates great material, So income. Yeah. sorta raw our of like has

put of You issuance, you starts bond see the up saying. know, the when the joy I United and about what know, he's past dollars trillions can't gets new of States of talking

just a else this of know, there You bonds like you do trillion, have going that gonna in thing. issuance greatest I and up country And says the is issued like flying ones, material our material insurance the moral major world for same weights deals. going And underlying borrow bond going the these is sort and It's of business. bonds is the factors door. issue are going when has just be bonds, someone lot that's bond are to to out who good them? know, are deals, they're $X.X to Every

thing money in constraining the the, you insurance is everybody. on make Now

You year, the continue they sort client That someone, is is it law for move the, or the to, business. new year. know, because they of firm the firm insurance old in insurance to the way of stays hire the the, first hired the that works year of the client land you and not a the at the effect over you the do way last the, works the

your ago, for build business who and So those year. on you've year hire you hired those you next went a today today,

we that continuing to start what harvesting robbed that is are were last obviously hire? going hiring to people So big are to spree are. those before you began, the right? those year, numbers. course we the see pandemic But we going big, Of

from So see to going our business. good continue you insurance numbers are to

You're going on to growth continue to see good business. insurance

knew So amount we to You right? would hired was were like action there we which a can what spent you'd greatest twice because building a year, money significant drag, is see drag if saw we the take, hire last no explained happy you sorta the our business. world's And And is like team we on drag. year calls know, today, his be we today of next were we drag, you them.

costs. if lost the of And ago, until come with lost we the money. a lots XXXX, only amortize paid money hired business We XXXX we them, now. the people, because You great didn't year know, them

is part turned good profitable. we've the so And

as as will will build a we expect confident that But and to said, that transaction, a profitable, whether of that a created And transaction, of excess remain public otherwise asset scale or court. with hire over I eventually, to expect those find transaction, the brokers expresses that's I in And we've invested. it. we've substantial built profits our more We private the we value have time. what are constrain think that we we business, significantly we value in

Patrick O'Shaughnessy

That's Great. Thank you. all me. from

Operator

go a And from Sandler. pedo Piper Richard we have Please ahead. with follow-up

Rich Rippetoe

in margins that the quarter? about How insurance somewhere, it would QX, in on the business? Maybe missing the margins? talked question in insurance you even, I believe business first the I broke I'm but first the

Steve Bisgay

right? we to and They're We the started, time. now we over small now they're in even a small. black, know, break right. They're this you And, we're remember grow got small, just house, in it to just will it's not continue there,

time. brokers As, as like it don't our brokers on of bring just first you our takes you more as past year, know, know, come their accounts, their on more of Monday, which are can

to And so thought we, they're of the said standard industry course the a over years, over to margin. And we grow get we of going the to number year. would that continue XX% we

when we million. remember we, But we, XX% said you those, the point in we businesses was. and would day? $XXX expected, put grow Yeah, do approximately have would think margins. time And Sean, when from out, the it So double to I we those we we

inerence to were XX%. doubling around from to industry So we margin getting a XXX was of

we hit revenue expect And our margin have million. when the $XX believe, XX%, million was XX% in some said or but revenue that revenue XXX, the and margin. at in the Steve $XX Boyce tomorrow XX% to expected $XX $XXX verifying $X we in hybrid just $XXX point million, believe a million, and So million, I'm of numbers, would million then if I I

Rich Rippetoe

Is that correct?

Steve Bisgay

said Yeah, close. he That XXX was Right. and he said, XX%.

Rich Rippetoe

margin Fenix, Okay. markets. next the the call it on is of we Fenix, question

now. go like to it's that to lot would XX% XX margins but a potential you, firms overall go has other how scale. said that Fenix the I electronic or to of So of potential thought XX.X that to the And, has that,

Steve Bisgay

me let sure right. got you me, Let the make

platforms Fenix meet or exceed else systems can anybody the has. growth that other whatever So

Meaning that us nothing are from electronic get call system, Okay. we I, on they of the is XX.X, get our, have people mark. standalone possibility XX% kinds the, the meaning XX.X let's fully with the getting scale, electronic could whatever to to get get to, to. get these that they but scale first we fully XX% to constrains with the are have margins margins, platforms. on other so goal, we, as can those said our But as

on in the expensive knowledge brokerage on the relationships technologically substantially are of going That's markets, get maybe scale will therefore I don't greatest our which greatest business. have XX%. the business, And get you and right? XX, with going driven business. continue the brokerage will this to think range up growth to the employ is the, to We who have right? we The Okay. think payroll. more which they will our of platform we I have is electronification our know, in greatest said, salespeople, they are remain they to brokers because the to range XX% to

Sarah of the the as margins. can, so And the all can, Whereas limit have best in know, the world. consistent sky's festival, the difference to think will XX players to other I XX% upside an is those you [inaudible] businesses Fenix markets

Rich Rippetoe

That makes it. sense. I it. Got get

Steve Bisgay

example. of, Now selling product, it give the is standalone back I'll voice one just are and electronics capability not goes just electronic salesmen Well, converting the to not. or me to question this like hybrid you an

that and government the extraordinary me British just an share not I'll product And not. know, right? you hybrid entirely Well, selling we give have like market alone. and example. from this business is are virtually to bonds. or Of, voice you converting gifts, salesmen Our, electronic electronics

excellent he entirely have where we And a but not had that from you business British and perfectly share electric. he is electronic, virtually voice a move we entirely Cause Our, it right? is extraordinary electronic, was virtually but gifts, a, into know, market business is of bonds. government and type here is business. Fenix of our an and executed great is manage markets And it It of asset electronically the clients. right. it But a vast markets. make that And majority work. is business its electronic brokers the that by majority

Rich Rippetoe

separable? Is saleable? bubble? that So it that Is is monetized

Steve Bisgay

perfect is and tools have Right? value. it. drive the when is that the data It markets. instead build came the right now what you clinics that's have of brokers well. and course. and Of Right. can And a of data it's of the going it But example from go because markets, Fenix right? let's And happen build incentive right our part of then to market tremendous we're And that concept markets put market as have

Right. that's, substantial make business. of money part we'll amounts of yet? We will. the data on, we growth of this we, do we is So our on But guilt don't

of that, Phenix technology and or inter that but me, XX included the company, the those could through know just and to want and market revenues brokerage that you grow. you that to So understand try at far I minutes, walk going of electronic showing take numbers we're Left the referred, for in quarter? the, want away $XX.X last the and I million been don't in week to $X it. But the haven't business value that, as not what as XXXX mix data keeps the fuel billion, that and the talk Phenix so concerned, maximize they're about I data first services sort to we're but the you we're market you that, you markets something you from one, could

Rich Rippetoe

Sure.

ahead. you to do go Sean, So, want start,

sure. Okay,

Steve Bisgay

the the you will business, that the market dependent. to the technology businesses, be Phoenix the expect so intercompany than remember like, our paying to is is that as it that becomes if technology, decline our brokers, then, by is business a lower we'd to as What Sean more expansion within And the it has the in paid is the provided that say, Fenix the an the, is to would is by by you in two what to business as, that that technology that BGC that because fee to, of offset is into company, there'll we moves And three you're is in down. move margin we but seen offsetting, smaller company a the as the margin, business. is rich, therefore markets as into Fenix that you've previous those you've technology And and our mentioned expect that high what over business technology. you've in, businesses brokerage come courses, markets hope last increase. and seen as courses, seen grown the, also for

Rich Rippetoe

be and a the Fenix revenue to it? it for growth of as view that Fenix sort markets on to pipeline proper Would XX.X

Steve Bisgay

of in Phenix $XX about the potential but revenue it's, I very think, guys, that into, of really but is the would good way you it, That's that as actually. but to about [indiscernible] a exponential mean, that good it, of million into a is I technology nine so that just in number, revenue not actually, way thinking remember expect that's to it's go, that think the piece. guys growth because an add markets. moves a

Rich Rippetoe

very helpful. understood, Understood,

Operator

to and over our turn I Lutnick the closing remarks. back I conference This to session. question Howard That's concludes have. Thanks. answer any like all for would

Howard Lutnick

it understand, with said, helped will those these value to tried and you that I company, forward, the we appreciate gain, to understand all value time margins, right, you our revenues have I our focused asset building us separate are We We more to try are revenues spending well going value focused transparent today. as and these is you make growth clear to how to which and I and make the And of our materially. grow platform on the Lennox doing we we our shareholders, maximizing the express our them shareholder you we expect we we need and, value. purpose, we for details. tried will the assets, to But we show continue company to and to is you and will on. show which markets. clear separate obviously we have hope

today your updating forward you appreciate So to next and time. time look I I

Operator

Thank conference today's presentation. now for you The concluded. has attending

You disconnect. may now

BGC (BGC) 30 Apr 212021 Q1 Earnings call transcript