SNEX - Earnings call transcript Q1 2022

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good day and thank you for standing by. Welcome to the StoneX Group Inc. Q1 Fiscal Year 2022 Earnings Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. Instructions]. [Operator that being advised conference today’s be recorded. is Please like the Bill conference Instructions] CFO. I to hand now would today, [Operator over to your Dunaway, speaker Please go ahead.

Bill Dunaway

morning. press XX, XXXX. to the market Dunaway. for Good we first our After is issued results yesterday, conference a our December earnings reporting call Welcome ended quarter closed name My release our Bill to www.stonex.com, presentation fiscal is our our available website refer at release which and of slide on a This as this XXXX. quarter as discussions the quarterly first well call results. on we’ll our of for

need live will conclusion. view an to sign website be will You presentation of archive to our onto call’s also webcast in and the The presentation. the available order webcast the on the after

known to conjunction the filed with thereto, uncertainties the most and Section forward-looking in SEC. as as the unknown we filings and the XXA as the XXXX getting you well Securities that note statements of XX-Q discussion are all the in discussion XXE with should Before should Act taken Section statements as and SEC. and detailed with contain notes amended following This Exchange of within forward-looking involve These Act risks of Securities meaning amended. which of required XXXX advise may are recent the financial be participants statements the underway, Form and our of

statements new CEO. or any Sean The from results expressed assurances based update not result are statements O’Connor, Company’s undertakes publicly I’ll not whether future future the implied company’s reasonable With any the of forward-looking materially cautioned conditions, the that, or over business forward-looking Although now otherwise. regarding events, its to forward-looking information, the can statements future performance. company’s or call are upon that a forward-looking any turn there to are that obligation the believes results will statements. by no company that company guarantees no actual differ market and assumptions revise as Readers be its of

Sean O’Connor

and XXXX and during tangible strong morning joining manage the [Indiscernible] grow These to basis. XX% favorable for for earnings with value Bill. the to. contemplated take book fiscal of our on for was Market stated significant a conditions view Fed quarterly year the call. us improvement fiscal have on and thanks there franchise. XX% we Thanks, repeatedly, an our markets term start generally quarter, turn Good from we results the ROE quarter are as prior book company immediately everyone first QX and inflation a financial the But long how we response as said in quarter. the more

trailing and that in results term As taken rather the way such, at best isolation. we the XX-months progress such to believe quarters as our is to longer performance specific than look gauge

quarter. on market up in is for I revenues double product product which was physical ago, XX% all securities our digits to Fed revenue we XX% us a up and With see and and X%. revenues securities Slide market for the for volumes XX% the comparing we As except three operating deck, down earnings drivers listed volume versus likely was are and of for respectively. business. interest and positive capturing sporadic an so. mentioned and except year Starting quarter its next immediately OTC rate support also last in FX, down withdraws and standouts X%. Operating were operating were capture increases the Securities the Revenue increased direct year securities, against XX% both derivatives did increase prior ago all increases, products XX%, increases, a revenue all for Transaction quarter. in versus year metrics year the with prior down capture in key areas, areas in the be as the offset except which the environment call, volatility CFDs. believe or from versus for commodities that for up the the although positive with the was

securities Our room significantly last growth. and five expanded have activities is we there still over believe years considerable the for

activities continue results We revenue mass. will and reach of products, expand in and these make have to higher time, related as investments into costs lower over additionally which change and some metric until new capture, new critical

versus float, client XX% products client revenue market on stands balances and operating average higher ago. Interest volumes we now growth as balances with fourth now billion the XX% on listed due see experienced were for revenues quarter the rate XX% up in Versus in share earnings to client later. this aggregate derivatives ago strong client versus well with down Physical were although gains, a are increase interest year and QX XX% increased and all increases, $X.X Securities Volumes quarter. from up XX% securities commodities to up a except which as XXXX. offset quarter, the due starting XX% XX% both was to capture. operating in the revenues an more were flat Our up prior and both a Clearing for respectively, higher immediately at essentially year

increase all capture We products. also saw across revenue

interest Our earnings float were and on balances X%, X%. up client average up was client

and the looking December double increases trailing heightened volatility that the was good across result, in the for earlier, revenues increases were board a down and as up four, securities the where XX% period. Slide the versus again reasons XX-months, revenue a as of comparison XX% except was and across we a at derivatives There result There volume X%. listed result except listed to which engagement exceptional was the which were given tailwind. the includes onset experienced board the revenues to payments up XX, product client was the and XXXX FX, which versus revenue trailing were for comparative Securities XX-months global for up and digit OTC really mentioned period. product for Turning very an for down enhance trailing of strong operating strong comparative XXXX. slightly, period XX-month ended regarding down capture metrics derivatives, slightly for capture is CFDs. the speaks Revenue This COVID-XX

average reduce slightly Our a to float, action derivatives prior clearing period both in respectively, listed incorporated up client a and growth rates. interest XX%, securities down and comparative Fed period XX% the to interest strong earnings experienced with as

X accounting up X%. $XXX.X versus million flattening of on were the book the line Net were were an the revenue share, with an the transaction. up prior impact adjusted impact for out or in basis, XX.X%. excludes XX% earnings XX% of of revenues Gain XX% net is operating per and acquisition. reported, earnings also ROE Turning after only adjusted And recorded expenses Gain a Variable compensation earnings $XX.X the costs was value. Total this operating On up which was an and year. of growth. other XX%, now diluted representing Notably, ROE to fixed $X.XX stated the $XX.X million an up representing Slide compensation which the of our and summary basis compensation as quarter. on were We million

million Looking period. XX% billion prior was at an the revenues were summary up trailing over our on and $X.X comparable adjusted income $XXX.X the XX-months, basis. for $XXX.X Net operating the million

or on the XX-month adjusted EPS trailing was for XX.X% period XX.X% $X.XX diluted a for an reported basis. Our ROE

which earnings per similar up quarterly with the up XX% million was share book were a XXXX $XX.X $XX.XX, Our XXX% quarter than immediately We ended of EPS higher value QX or prior a showing ago. a versus year increase. with

a basis and for segment quarter. on touch segment to the segment gets revenue Securities Bill operating showed strong our income Slide increased just for and was income segment, was and operating was XX%. into operating revenues revenues for XX% said, was That highlights was now XX% were Turning records. XX% new up income income X, XX%, earlier. XX%. and XX% quarter the and up XX% and revenue a reasons both discussed down up XX%, were up down XX% record segments payments The to segment for up sequential global detail. segment revenues payments. the commercial quarter were the which growth quarter, revenue X% Aggregate segment summary income standouts also segment more our which on up Retail operating was in the income operating up for up Global operating before I XXX%,

trailing the security we XX-months the XX%. growth with which for except double digit For see same board, much across down was segment income of the the

our earnings deck this to sets time. out XX-month over slide which new financial a performance trailing added have We

disclosed the on in is appear eliminates accounting acquisition, As page performance to prior quarterly to in and as have this filings deck. been gain as the last reconciliation earnings said better of treatment our provided adjusted These numbers anomalies. the upfront, related a think the evaluate for it progress our I and way which our I this

Slide that X. to number new Turning

On the our left nine blue the quarters. the bars last trailing XX-months operating hand revenue side, represent over

can capabilities. you and smooth our been steadily as remarkably see, has As strongly upward expanded footprint and a this we have trend

this are CAGR. revenues over up XX% Our XX% or period

significantly, has Our a adjusted period grown up XX% pretax income this for XX% likewise over CAGR.

some XX%, the last two XX% nearly dotted other you discussion On in even between though which periods income over represents shows net this doubling The over yellow results. period. Bill line of which I'll a the couple you With the stable by of financial see XX% side, bars, ROE, our our first years our capital hand a hand net the right has the over and us grown for in adjusted on Dunaway can income been to CAGR. Bill? that, than for has relatively XX%

Bill Dunaway

to in capital the current clearing consolidated Thank of of Sean to were consolidated the current period, highlight few dealer, operating X represented income relatively year shows you, a financing Interest increased prior in term million so for due net of income quarter the $X.X million flat fiscal expense the conversion then in Sean. fixed higher on along activity headcount, compensation. with costs operating increased in million; expenses period. of prior the clearing related we Introducing primarily commissions a for million at to broker revenues salary quarter, flat up within to to the fixed increase an due the primarily quarter. average the institutional activities. equity move our to prior have million increased were expenses Slide prior increase in million with X% the increased business. Variable Other fees Fixed to ADR I markets the volumes $XX.X increase $XX.X benefit average year the which in with in comparable and net starting and $XX.X higher and share securities of and facilities period. the many growth statement highlights covered $XX.X $XX.X year, from with principally versus a with lending discussion. $XXX,XXX short XX% resulting of XXXX. on based preceding Transaction million just I'll an $X.X the $XX.X be our versus daily segment the based our XX% versus compensation would year increased in the in however borrowings relatively year were increase that prior subsidiaries, number million compensation and first immediately in revenues

of As our technology trading market to and as system expand $X.X part $X.X non-train offerings. compared digital sport prior our the to increased million increased year, information and million and initiative

and addition, marketing and and fees expenses $X.Xmillion increased respectively. In $X.X million professional selling

the year. $X.X started net of of debt million to to had prior in XXX% fiscal the we $X.X see million expense bad and debt Finally, increase of represented development increasing quarter increase $XXX,XXX was in first prior as year. expense a the compared versus quarter over for year, income recapture have immediately travel Net XXXX business bad for in preceding prior increases $XX.X and We quarter. the XXX% a million over and the the

quarter out with year share net share per value ago. Finally, we $XX.XX a $XX.XX share of this per the per compared to a asset closed

million preceding added Moving revenues prior our quarter. versus revenues. in segment $XX.X the provide year on operating some operating to Slide number $XX I'll more the immediately The on million commercial versus information X, and

performance versus OTC OTC million by energy renewable derivative were in a $XX.X $XX.X the prior prior as primarily year result result and precious for $X.X lesser transactions energy and the which nature. a increase a physical million at a the carried gains improved fuel physical the contracts physical rate a versus revenues prior in rate by $XX.X driven or Operating average extent in in Within increase contract increased metals. per decline was current from the million of of in operating Operating dollar in revenues. revenues period year a favorably million of and agricultural and a as prior and markets. a operating increase offset result similar million the year segment in were as a average $X while listed up million $XX.X revenues of the to increase revenues the a increased of This on volumes. compared to the million XXX,XXX LME and commodity fiscal as derivative cost strong contract unrealized X% inventories for net revenues a XX% realizable partially of impacted period performance was a volumes, a quarter, per value, increase result realized of sale of included the by loss lower year XX% derivative contract metals XX%

principally $X.X in in interest as uncertain increase income a $XX.X the year margin an balances client of charged XXX% customers million Segment period on balances. equity, due year, to average for earned increase interest the XX%, to as client prior and and quarter million well versus over increase the period, preceding XX% the respectively. an Finally, was increased prior

derivative versus operating number securities daily revenues and offset fees $X.X XX% period XX, driven a and earlier, contract RPM from revenues by contract XXX,XXX year the per increase a in institutional relatively a COVID declined derivative of was a XX% operating heightened of the and million an securities decline by $XX.X prior decline $X.X year The of million in of primarily X% in expense. primarily clearing of was benefiting primarily increase revenues in increases revenues as year. on million million the versus increase result part respectively. average a pandemic. driven the spreads $XX and volume current to $XX.X flat our prior revenues declined segment mentioned in decline transaction result in quarter, Listed securities XX% Institutional I rate are the operating due RPM. than to the revenues with in as transaction related million preceding result in the by as to Moving in Slide a declined decline listed the $X.X well a operating Segment immediately million interest in as income increased volumes primarily in increase more volume based securities as volatility as as operating wider prior quarter segment result

development million In Segment immediately addition, securities software. result listed fourth of the as versus an developed $X.X depreciation non-variable direct professional due of fees, year, $X.X expenses to prior a quarter performance derivatives. income in and primarily increased improved the million increase and travel in and increased versus internally business preceding

segment to million. slide, CFD a retail on was a as in by of the our a the next per added the which FX Moving million result driven XX% increase $XX.X rate and revenues $XX.X primarily operating in prior increase in million year, versus revenues

in the $X.X added daily $X.X million versus was management a in compared preceding immediately the increased and wealth quarter. $XX.X and Our the driven and revenues $X.X rate million year. $X the a million in partially the expenses XX% the driven to per represented income primarily income added million period prior segment versus result the versus million our increased variable volume million increased preceding operating out expansion the non-variable a of retail as increase million primarily current primarily a primarily result prior operating expenses, selling X% by payment prior of Segment businesses increased and prior global the and increase professional in Non next and to respectively by $X.X immediately average in as the year, increase is a as non-variable year, XX% discussion revenues, increase in over Segment $XX.X in of the fees operating in compensation, year. precious operating marketing. the income $X.X in a million and which the related metal and revenues offset a increase physical XX% million Closing slide, the direct to offering. $X.X versus increase increase by $X million million a on million in Segment increase increase quarter, revenues. payments $X.X

I've which or the the operating year. segments. slide the XX% first prior bridge in on the XX, to for revenues for were Moving last current operating Overall covered the $XX.X period quarter number between current represents our the to our segment in up changes million year segments. operating million $XXX.X revenues of revenues across period, over the operating

overhead related period. unallocated internal a in current increase support. to increase million a a Slide revenues $XX.X $X.X as negative million next of million $XX.X $X.X bridge period. increase compensation the to to in in The the and FX increase capital in the net income expenses, overhead in represents increase a related result XX unallocated fixed XXXX the pretax is in benefits, of the Gain variable variance the of in non-trading performance, loss million including of million is related a The from a an However, pretax technology in quarter prior million first subsidiaries operations primarily and improved $X.X $X.X U.K. unallocated on and $X.X million merger, year number primarily $X.X million of compensation income

on rate during number this term as Slide by earnings will Finally, which invested sensitivity X interest float. XXXX fiscal to and the earnings quarter strategy change year strategy Sean for rates. short in portion similar moving depicts rate shows two on duration XX, swaps XXXX. utilize December a details table an We next to our client which early but client interest interest of on average of late well more January and sessions in as in into lock the balances to entered in billion with in we called, a our rate associated interest interest and annualized touch

on table, million As tax swaps the noted earnings basis. are incremental $X.X after annualized the an in these annualized on

we XXX on rates $XX.X In of that, I turn retain remaining the it addition, a which basis increase billion per to by table for short we investable share. this increase or $X.XX Sean would million estimate for income sensitivity like total as the $X.X incremental would net in term discussion. to in noted back balances point strategy With

Sean O’Connor

Bill. Thanks,

is we local are high we make on far Turning XXX that focused banks, now management a This expanding offering large midsize and Starting for countries, in issued platform to We leading progress this capability over that focused payments, objectives with quarter. detail XXXX. or efficiently that and institutional seamlessly level corporations. and thus global StoneX corporations, all of franchise on, out the on last strategic clients. we digital building be and to into NGOs including last announced to payments be rolled during corporate XX,XXX a discussed is into the year are

the leverage border During new complete such of to existing in Brazil have regulated able clients, franchise. we others many to we local cross behalf will pay-ins in for capability This [ph] well these our certain capability local as significant way, as in payments countries. current the of integrated markets on accept be requirements, launched these to whom digital a bases as clients. more our this quarter, and have client we that a allow payments will and payments announced us capability global handle In

grain business, part market just automates always merchandising loyalty. large DNA, side we growing commercial and merchandising to and helps added streamlines a been activities the On clients. our clients industry, and of the StoneHedge, share increases value the systems system of our for which our engagement launched our has grain clients Providing of and digital

launch of the We full new provides our also which a suite aimed producer. App, Phone completed soft individual of Farmer’s commodity products Advantage at a

have this client segment We through accessed brokers. introducing previously

able now a relationship and example service was client are us. to which and We client directly, between great the the of teams, for team. clients and technology segment folks, digital Gains marketing a new potentially facilitate these retail opens collaboration large This

generated in out internalizing profit we rolled company. executing so on domestic our trading our quarter, a which modest focused electronic new, the our stocks, and albeit securities for internally doing, clearing flow stream And initially from the capturing activities. U.S. for platform During

expanded we We who client silver platinum will auctions, now first our to together relationships interest December, center start that us auction. move diverse U.S. The rates clients business announced putting and course and of base. will relationship believe for can the an these of rate stocks. used for us platform source the of into previously late Fed new rolling precious become gold, we member that increases broad is started timing extent out capability Platinum serve only to that non-bank signalling We so member with metals foreign higher, at StoneX thus In execution trading large to potentially in revenue with the the now months. of and of dependent us. and existing client and trading electronic our better raise leverage the existing our and this the the this clients, market of a to new start a the we global Yesterday, have interest not exact is coming probability these data the LME guaranteed.

a into ensuring interest portion funds. moving However, on lock higher interest funds, to of client earnings allowed thus the of client and immediately our on a portion guaranteeing swaps our rates us

should continue to be determine that disciplined We it growing float the QX whether exact up takes. in now increases the medium client on term or probability in moved anticipate the action also five makes to bill by the the look the should we on Fed steady for in noted at average of dependent to action Fed yield see a rate also over will in start lock earned four rate and about the XX last time. starting a basis rise that weeks. our in month the sense waiting We T three It points versus swap in the manner versus

of take structure. capital to the the Finally, cost to the we allow combination funding, completed the most as debt drive down have of capital started bank hopefully This quarter. reassess of envisages strategically to well will third end the advantage be restructure as debt of process and significantly and structure our -- fairly us this optimal fiscal to us our refinance by

ROE on conditions We Moving of year of a diluted segments. results and and clients a fiscal through $X.XX EPS good and or book to up, on view our value. evens excellent stated slightly XX. When such a strongest achieved as was a Slide our XX-months, term across with through products out wrap performances of this to our trajectory. trailing And quarterly results on steady XX% XX% longer one stocks market which lens, show all anomalies, tangible book and upward strong

strong see tailwind clients puts and base. ecosystem. This to it rates engaging client year, client speaks of continue a real and the heightened market, and base the integrated of underlying client launched, to our tightly client in our growth behind volumes so. We interact trading with their see and for engagement This which to growth or interest make volatility, assets, a business general which side financial we'll digital more increasing combined client by our number our for year next to offering more were being with platforms in

initially bringing costs further as actively are with market that increase with these profitability. associated increased our growth margins overall start the and should technology accelerate we them, we provides to seeing platforms, to we While scalability up

already segments of be for the will where to ourselves we to capabilities, we we of of them very financial large footprint already, space have believe that to monetize large we around with now we ecosystem share client areas by unique markets, TAM. where and a in best serve basis these may dedicate we to growing niche have to better total service us of market One with have market access StoneX the need them client single aggregate, world ecosystem always global the the team, we’ll a and and have opportunities. comprehensive we, financial may constant our our In markets. front continue share thing points providing remain have the addressable and good safe relationships demonstrable and while wide We market

with So them there we'll any operator, are take that now. if questions,

Operator

Thank Fannon you.[Operator question from comes instructions] line Our the Jefferies. Dan of first from

open. now is line Your

Dan Fannon

Hey, Good thanks. morning.

Sean O’Connor

Morning, Dan.

Dan Fannon

just balances. rationale want guess, mentioned guess rates I with your the for the of the doing the maybe but maybe just retaining about, I upside go course this you of swap talked you versus I of that. as associated rates just And with context make mechanics to I and starting cost normal I guess think around higher, the the understand sure it. kind that reinvesting some

Sean O’Connor

Yes.

couple a So here. points

lock process. So that did going of we, were with at sort is we we successfully that we certainty, achieve three, methodology because us waiting in earning can look aggressively of with basically low, ago, We that And every instead it rates, start landed so we the shows we very two interest calculus and versus we rates say, a do. we if quarter. same what year portion we, that and we then look December, way, to or here, we it term five disciplined at at what five enhancement a gave it look with this the four the into Fed we that, the of or which moved we in total a when what we our rates get a rates, period, of did to higher it's if earning prudent says four that an would result that about rates, we short earnings where immediately in do would And quarters, balance, late year time. at us now? start can setup two better point do years having current And the decided at we in think over very sort implement rate. at of And time, it's rate

fixed aggressive a back if cost, with rate end, its on over increases Now, into but certainly year have period. you is lock you obviously may rate the two an opportunity that more Fed the

we when that positive. was did calculus, So it

that over period. be We probably that in versus the this the But that one consider where I had look and the swap and be interest it two look and stand projected, we'd is swaps. Fed happens not obviously it go Fed uncertain, then see what positive. look wait, March, first If calculus, we plot, I year think shows we’re And territory. we of aggregate things would at the that and earnings wait plot if we any will again, to doing Fed us with the tedious change. it say, never what sort just going I mean, at Fed the right? Fed do At The in a increases. versus predictions will we uncharted what these to sort though positive of probably If more now. in do instance, certain, out an you will thing right at point, past, back given of that almost did it's wouldn't calculus positive, earn

by means seven these are talking that are rate So about people increases now no certain.

there's So some that. variability to

right. capital and broker whether high haircuts costs what assets. In be that, similar, on can buy instruments, we have that. dealer, it of terms that, in execute our or If we how quality go can year, options, we FCM have actually rate We treasuries we do two it us broadly just two additional

we use trades. play other book well, markets, as actually, capital. we up So that to If capital. those instance, have to was that a got way. We the does any it make don't swap calculus margin the had we tie tie we've up may because this to client support some In derivative

released back capital firm. trades these to the it put we on when actually So

of you capital zero if of and So sort like. we cost a had sort a win,

if rate in we've to choose from that's see stop beyond two it we at for what year that a increases is aggressive two can have enhancements of and going of all haircuts the I’ll because also rate get. at I then, curve, once the constantly it and you but finished, becomes think how probably rate the The can hope on makes years you there. too quite to us. swap that's beyond we're the years So we years instruments overnight going positive you're kind reason yield how still And is two even sort look looked sense two egregious.

category. of to stay zero to two like So that we kind year in

Dan Fannon

helpful. very That's

that corporate for I that, should in obviously as about XX in coming And and to we expense sensitivity is a in Okay, rates there's and tied through to think revenue put benefit does returns just should time. that been general, not your or but the make of of correct? forth this, think but you margin level, this we it’s the overall there The not no profitability, incremental you only the high margin compensation, and slide some guess, of that lot incremental very higher sense. terms incremental about at think about

Sean O’Connor

Yes, absolutely.

that. on teams our to payoffs no have We

pretax it's drag that the that. on ROE compensation extent straight base, from added provides ROE, compensation they but ROE small because impacts So we a up, the if Obviously, the will to very line. goes to to that team, that are be executive goes on

XX revenue people margin, high if line very the right. it’s important I X%, in you much, on in and don't context math source. that get XX the a the just pretax pretty top XX it's to of doesn't million. the So but if sound think billion, billion, in of $X.X revenue million X top billion And you million look doing context its really line, off X.X my understand, of the head,

very of it's it's, lots on leverage important that. So to

Dan Fannon

we think year And of the payments and sense. of I kind had Right, context to right. to, certainly start if quarter. or the the good mean, in a very business quarter, global about, the Makes continues

mentioned… I think you

Sean O’Connor

record quarter… Yes,

Dan Fannon

Recognition of place? gender and

Sean O’Connor

Yes.

Dan Fannon

say the this of context that to And is normal, this, we but business it you about what's if excuse more components so think the little the good just that elevated a any or me, momentum bit past be, a is this versus I there or may want kind on seasonal building you a maybe is here? Or in things bit think that what it there's might of quarter from health was normal. business, this is that as about consider don't

Sean O’Connor

considered No, seasonality quarter there our what was I this normal. payments I business. think be was mean, to is in definitely I global

of sorry, a look for a the on quarter lot do just anything. That's in there's the September quarter, typically so fourth away weak the a Europe, of and don’t is us, summer quarter just quarter you us. for back go If people holidays sort it, third

on catch of September a weakest December which that a the QX, bit quarter, reported the find probably we normally quarter because little we there's the weak after find just quarter So four. then of up always is we the QX. the is that is And the the strongest the

So almost we up, happen catch that seem to see year. every

largely NGO, and So the that less seasonality, business is from so from comes there part of our our banks.

these, XX we banks XXX continuing So these some money of markets I we sort of business who probably it payments we I question. are that and these terms their an and, answer the I the mean, to in to business large more pushing largest and flow. into mean, for the of make global of are borrowing seasonality is do systemic banks, much banks are payments, world, world. for. to grow. are into world another how would your around say I incredible of we in those around the countries, almost we that's, And deeper getting that's mean, midsize local The franchise.

nice growing a franchise that got So clients. business our value relationships We've there, tremendous that's a with pace. is steady great at

what starting is little now at to we probably ago, of think, business think new re-energize look avenues to starting are the sort some I sort to and a starting quarters three see of, bit. I now you're

sort we've So, touch just smaller digital to where, offering go going with to corporations started high isn't work. to a off a of

where your platform is right. of do in us, licenses have our we sort up pay that of the key the we can So And a business, whether some also smaller digital whole try internal this use countries to for business. that avenue some new That's of also see in gather clients. payments, we own for companies in

NGO I And you those period, our see is been over become of So own the of probably of the very which initiatives year segment would would a to on is, those of three costs banks sort what indeed, bit I say we the their some additional think sort otherwise build seen two But income, some hope additional a to have a is a put businesses business. there from costs. out and fund right. have drag may to in sizable little going businesses

start could as business of think sort accelerates, those payments accounts, getting of It breakeven, makes business. from the it's But last start think little sense. its businesses quarters. where seen A you people terms payments to turning to push. over from you should beyond the And a to now. that that of breakeven, I don't see So, going it we've we I growth themselves growth. we bit in the I start be different think materially getting is expect global

Dan Fannon

Yes, on kind guess that up And thank this of you. is in does, of expenses items Bill I a quarter. in terms other follow notable and the

as sub positive. global period. segment payments there and out level, December some the think I level he of stood should than but think might here of the or there or debt corporate obviously investments materially a I that smaller, either anything, saw [ph] other through wasn't anything quite what rates that run at different think we walked we the year, of this about the remainder kind that segments, the or that about was guess, in have about, in But talked actually we we just

Sean O’Connor

you don't take why Bill, that?

Bill Dunaway

interest a kind about bit. to that as as other expand it continue to we've creep material would that. quite Sean notice, thing probably is than digital only of continue substantially. touched comp little is the nothing to where I more nothing, I lines from non-variable we'll a see, going offering, now up that, do we as be but not bit talked expense And in Sure, think the

be to we to this, looking we the going are on put refinance, debt did to, game the capital when We acquisition.

business development, significant expense and even have here see some sequentially planned would a note go being some be basis. say, times, more of we're the But there'll We has flows gone Offices an in travel opening coming of up. of kind of to changes thing see conferences, is and the I increases have and and the some as willing we've go-forward starting us, kind quarter-over-quarter seen we here. think interest several we big hope, outside that, on and some there line to like, last So up clients to ebbs had COVID. but that do come I that

and up, business on some those see of beginning bi-annually. travel you'll our to outlook do expect development at see, go March, some costs global we of press is which we'd the releases here something put we've So, out market

it's something relatively us. that And for big is so event a

that that, I to at and out me. some see of and nothing outside travel jumped I would of So interest business and expect but development Dan, else say, increases, note, would

Sean O’Connor

strong over years we think that, one say sort to quite probably speak did, two I fixed that would cost our growth. decline would thing component, of see of sort I other of we

Some gain. of that was

and and challenging, of our of And We did so It's, sort that was some more year an plan teams a up, for those modest sort increase technology of spinning spots. it's filling on. this increase.

around that So, people. we what see into may of sort the the back just little year because is some the challenges being something of hiring of costs into bit

over don't think planned. sort different than had happen to of to It's going going evenly just not the it's aggregate, probably planned. in we anything quarter be So, I as we

just challenging. So

Dan Fannon

the you over where prepared remarks, and as just and being of just to organic the your you but lots are. and And Sean, firm then environment time, acquisitive Right? about the you think Okay. TAMs mentioned today, opportunities, listening and

backdrop the in backdrop ahead? of -- organic inorganic internal of kind see do kind the So have M&A some you is this versus of you type of attractive kind versus, the of is current in focus the opportunities

Sean O’Connor

is to only lots going therefore, something you that we and on. can have capitalize our do be right? opportunity priced and it good we've leverage its we Yes, set And that always our we've around capabilities allows to And right, fits, we don't news ourselves busy been we've grow side, of business on more us that's the ways very and if acquire so to is we've we having on got business. The think of really done. out the on an acquisition Because, one, good our number keep of I always, I criteria, and to a acquisitions think growth. organic it much lots acquisitions, has much so situation profitable environment opportunistic. internally. strong prided disciplined many as sort And a number have ever to we've It's always seen that businesses. go been never one are to goal We've and

So value add don't we And pretty to And I we've disciplined. be to. we overpay, very we'd think like us to think I that it's to can allowed buy businesses like successfully. done

feels think a in is price me on some that eye organic to off side that we where the growth our it enormous ball side, big. And sort the the I environment, then got situation necessarily we've unless to take the So have of don't acquisition overpriced. want this opportunities on you everything's

think that, lower kind I that as But been of in high. something to probably got on the do internally. potentially. meaningful. we'll happen, to buy a businesses are of than anything the lots of because And has going will It's the at. not that soon we time stuff do So way unlikely honestly acquisition we probability think as probably it's I side, say think we're something But it prices I environment, probably the it's really right just past kind see look at to same I just good the not time,

Dan Fannon

Great. Well, questions. my taking thanks all for

Sean O’Connor

Yes, of course.

Operator

the call questions. over back I'm for Sean CEO would this like further At I time, to no to O'Connor, you. remarks. showing Thank closing turn

Sean O’Connor

again, forward three to thanks to And everyone or speaking look us. for in months we joining so. you Well,

So and thanks for your interest goodbye.

Operator

This Thank you concludes today's conference call. for participating.

disconnect. may You now

Sean O’Connor	President, Chief Executive Officer
Bill Dunaway	Chief Financial Officer
Dan Fannon	Jefferies

StoneX (SNEX) 8 Feb 222022 Q1 Earnings call transcript