GAAP DILUTED EPS OF $1.61, ADJUSTED1 EPS OF
$1.64
GAAP NET REVENUES OF $1,203 MILLION,
ADJUSTED NET REVENUES OF $1,216 MILLION
RAISES QUARTERLY DIVIDEND FROM $0.10 TO
$0.25
Interactive Brokers Group, Inc. (Nasdaq: IBKR), an automated
global electronic broker, announced results for the quarter ended
March 31, 2024.
Reported diluted earnings per share were $1.61 for the current
quarter and $1.64 as adjusted. For the year-ago quarter, reported
diluted earnings per share were $1.42 and $1.35 as adjusted.
Reported net revenues were $1,203 million for the current
quarter and $1,216 million as adjusted. For the year-ago quarter,
reported net revenues were $1,056 million and $1,015 million as
adjusted.
Reported income before income taxes was $866 million for the
current quarter and $879 million as adjusted. For the year-ago
quarter, reported income before income taxes was $761 million and
$720 million as adjusted.
Financial Highlights (All comparisons are to the year-ago
quarter.)
- Commission revenue increased 6% to $379 million. Customer
trading volume was mixed across product types with options contract
volume up 24%, while futures contract and stock share volumes were
down 3% and 16%, respectively.
- Net interest income increased 17% to $747 million on higher
benchmark interest rates, customer margin loans and customer credit
balances.
- Other fees and services increased $16 million, or 37%, to $59
million, driven primarily by increases of $13 million in risk
exposure fees and $2 million in FDIC sweeps fees.
- Execution, clearing and distribution fees expenses increased 6%
to $101 million, driven by higher customer trading volume in
options.
- Pretax profit margin for the current quarter was 72% both as
reported and as adjusted. For the year-ago quarter, reported pretax
margin was 72% and 71% as adjusted.
- Total equity of $14.7 billion.
The Interactive Brokers Group, Inc. Board of Directors declared
an increase in the quarterly cash dividend from $0.10 per share to
$0.25 per share. This dividend is payable on June 14, 2024, to
shareholders of record as of May 31, 2024.
Business Highlights (All comparisons are to the year-ago
quarter.)
- Customer accounts increased 25% to 2.75 million.
- Customer equity increased 36% to $465.9 billion.
- Total DARTs2 increased 14% to 2.35 million.
- Customer credits increased 9% to $104.9 billion.
- Customer margin loans increased 30% to $51.2 billion.
Other Items
In connection with our currency diversification strategy, we
base our net worth in GLOBALs, a basket of 10 major currencies in
which we hold our equity. In this quarter, our currency
diversification strategy decreased our comprehensive earnings by
$104 million, as the U.S. dollar value of the GLOBAL decreased by
approximately 0.73%. The effects of the currency diversification
strategy are reported as components of (1) Other Income (loss of $2
million) and (2) Other Comprehensive Income (loss of $102
million).
Conference Call Information:
Interactive Brokers Group, Inc. will hold a conference call with
investors today, April 16, 2024, at 4:30 p.m. ET to discuss its
quarterly results. Members of the public who would like to listen
to the conference call should register at
https://register.vevent.com/register/BI26c88a82ea0c42b9a6ac91b51a30659c
to obtain the dial-in details. The number should be dialed
approximately ten minutes prior to the start of the conference
call. The conference call will also be accessible simultaneously,
and through replays, as an audio webcast through the Investor
Relations section of the Interactive Brokers web site,
www.interactivebrokers.com/ir.
About Interactive Brokers Group, Inc.:
Interactive Brokers Group affiliates provide automated trade
execution and custody of securities, commodities and foreign
exchange around the clock on over 150 markets in numerous countries
and currencies, from a single unified platform to clients
worldwide. We serve individual investors, hedge funds, proprietary
trading groups, financial advisors and introducing brokers. Our
four decades of focus on technology and automation has enabled us
to equip our clients with a uniquely sophisticated platform to
manage their investment portfolios. We strive to provide our
clients with advantageous execution prices and trading, risk and
portfolio management tools, research facilities and investment
products, all at low or no cost, positioning them to achieve
superior returns on investments. For the sixth consecutive year,
Barron’s ranked Interactive Brokers #1 with 5 out of 5 stars in its
June 9, 2023, Best Online Brokers Review.
Cautionary Note Regarding Forward-Looking Statements:
The foregoing information contains certain forward-looking
statements that reflect the Company’s current views with respect to
certain current and future events and financial performance. These
forward-looking statements are and will be, as the case may be,
subject to many risks, uncertainties and factors relating to the
Company’s operations and business environment which may cause the
Company’s actual results to be materially different from any future
results, expressed or implied, in these forward-looking statements.
Any forward-looking statements in this release are based upon
information available to the Company on the date of this release.
The Company does not undertake to publicly update or revise its
forward-looking statements even if experience or future changes
make it clear that any statements expressed or implied therein will
not be realized. Additional information on risk factors that could
potentially affect the Company’s financial results may be found in
the Company’s filings with the Securities and Exchange
Commission.
____________________ 1 See the reconciliation of non-GAAP
financial measures starting on page 9. 2 Daily average revenue
trades (DARTs) are based on customer orders.
INTERACTIVE BROKERS GROUP, INC. AND
SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
Three Months
Ended March 31,
2024
2023
(in millions, except share and
per share data)
Revenues: Commissions
$
379
$
357
Other fees and services
59
43
Other income (loss)
18
19
Total non-interest income
456
419
Interest income
1,760
1,347
Interest expense
(1,013
)
(710
)
Total net interest income
747
637
Total net revenues
1,203
1,056
Non-interest expenses:
Execution, clearing and distribution fees
101
95
Employee compensation and benefits
145
128
Occupancy, depreciation and amortization
26
24
Communications
10
9
General and administrative
50
36
Customer bad debt
5
3
Total non-interest expenses
337
295
Income before income taxes
866
761
Income tax expense
71
61
Net income
795
700
Net income attributable to noncontrolling interests
620
552
Net income available for common stockholders
$
175
$
148
Earnings per share:
Basic
$
1.63
$
1.44
Diluted
$
1.61
$
1.42
Weighted average common shares outstanding:
Basic
107,070,830
102,958,660
Diluted
108,149,440
104,042,571
INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE
INCOME
(UNAUDITED)
Three Months
Ended March 31,
2024
2023
(in millions, except share and
per share data)
Comprehensive income: Net income available for common stockholders
$
175
$
148
Other comprehensive income:
Cumulative translation adjustment, before income taxes
(26
)
5
Income taxes related to items of other comprehensive income
-
-
Other comprehensive income (loss), net of tax
(26
)
5
Comprehensive income available for common stockholders
$
149
$
153
Comprehensive earnings per share:
Basic
$
1.39
$
1.48
Diluted
$
1.37
$
1.47
Weighted average common shares outstanding:
Basic
107,070,830
102,958,660
Diluted
108,149,440
104,042,571
Comprehensive income attributable to noncontrolling interests:
Net income attributable to noncontrolling interests
$
620
$
552
Other comprehensive income - cumulative translation adjustment
(76
)
14
Comprehensive income attributable to noncontrolling interests
$
544
$
566
INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF
FINANCIAL CONDITION
(UNAUDITED)
March 31,
2024
December 31,
2023
(in millions)
Assets Cash and cash equivalents
$
4,063
$
3,753
Cash - segregated for regulatory purposes
29,961
28,840
Securities - segregated for regulatory purposes
29,292
35,386
Securities borrowed
6,362
5,835
Securities purchased under agreements to resell
6,674
5,504
Financial instruments owned, at fair value
1,112
1,488
Receivables from customers, net of allowance for credit losses
51,395
44,472
Receivables from brokers, dealers and clearing organizations
1,684
1,643
Other assets
1,695
1,502
Total assets
$
132,238
$
128,423
Liabilities and equity
Liabilities
Short-term borrowings
$
14
$
17
Securities loaned
14,216
11,347
Financial instruments sold but not yet purchased, at fair value
236
193
Other payables:
Customers
101,197
101,012
Brokers, dealers and clearing organizations
561
590
Other payables
1,355
1,197
103,113
102,799
Total liabilities
117,579
114,356
Equity
Stockholders' equity
3,732
3,584
Noncontrolling interests
10,927
10,483
Total equity
14,659
14,067
Total liabilities and equity
$
132,238
$
128,423
March 31, 2024
December 31, 2023
Ownership of IBG LLC Membership Interests
Interests
%
Interests
%
IBG, Inc.
107,099,483
25.4
%
107,049,483
25.4
%
Noncontrolling interests (IBG Holdings LLC)
313,976,354
74.6
%
313,976,354
74.6
%
Total IBG LLC membership interests
421,075,837
100.0
%
421,025,837
100.0
%
INTERACTIVE BROKERS GROUP, INC. AND
SUBSIDIARIES
OPERATING DATA
EXECUTED ORDER VOLUMES: (in 000's, except
%)
Customer
%
Principal
%
Total
%
Period
Orders
Change
Orders
Change
Orders
Change
2021
646,440
27,334
673,774
2022
532,064
(18
%)
26,966
(1
%)
559,030
(17
%)
2023
483,015
(9
%)
29,712
10
%
512,727
(8
%)
1Q2023
127,329
6,757
134,086
1Q2024
143,320
13
%
9,190
36
%
152,510
14
%
4Q2023
120,886
7,932
128,818
1Q2024
143,320
19
%
9,190
16
%
152,510
18
%
CONTRACT AND SHARE VOLUMES: (in 000's, except
%) TOTAL
Options
%
Futures1
%
Stocks
%
Period
(contracts)
Change
(contracts)
Change
(shares)
Change
2021
887,849
154,866
771,273,709
2022
908,415
2
%
207,138
34
%
330,035,586
(57
%)
2023
1,020,736
12
%
209,034
1
%
252,742,847
(23
%)
1Q2023
247,508
55,197
75,522,066
1Q2024
307,593
24
%
54,046
(2
%)
64,027,092
(15
%)
4Q2023
279,945
53,883
59,046,908
1Q2024
307,593
10
%
54,046
0
%
64,027,092
8
%
CUSTOMER
Options
%
Futures1
%
Stocks
%
Period
(contracts)
Change
(contracts)
Change
(shares)
Change
2021
852,169
152,787
766,211,726
2022
873,914
3
%
203,933
33
%
325,368,714
(58
%)
2023
981,172
12
%
206,073
1
%
248,588,960
(24
%)
1Q2023
239,038
54,577
74,562,384
1Q2024
296,146
24
%
53,018
(3
%)
62,898,480
(16
%)
4Q2023
269,082
52,996
58,112,082
1Q2024
296,146
10
%
53,018
0
%
62,898,480
8
%
PRINCIPAL TRANSACTIONS
Options
%
Futures1
%
Stocks
%
Period
(contracts)
Change
(contracts)
Change
(shares)
Change
2021
35,680
2,079
5,061,983
2022
34,501
(3
%)
3,205
54
%
4,666,872
(8
%)
2023
39,564
15
%
2,961
(8
%)
4,153,887
(11
%)
1Q2023
8,470
620
959,682
1Q2024
11,447
35
%
1,028
66
%
1,128,612
18
%
4Q2023
10,863
887
934,826
1Q2024
11,447
5
%
1,028
16
%
1,128,612
21
%
1 Includes options on futures
INTERACTIVE BROKERS GROUP, INC. AND
SUBSIDIARIES
OPERATING DATA, CONTINUED
CUSTOMER STATISTICS Year over Year
1Q2024
1Q2023
% Change
Total Accounts (in thousands)
2,746
2,195
25%
Customer Equity (in billions)1
$465.9
$343.1
36%
Total Customer DARTs (in thousands)
2,350
2,054
14%
Cleared Customers
Commission per Cleared Commissionable Order2
$2.93
$3.16
(7%)
Cleared Avg. DARTs per Account (Annualized)
197
214
(8%)
Consecutive Quarters
1Q2024
4Q2023
% Change
Total Accounts (in thousands)
2,746
2,562
7%
Customer Equity (in billions)1
$465.9
$426.0
9%
Total Customer DARTs (in thousands)
2,350
1,934
22%
Cleared Customers
Commission per Cleared Commissionable Order2
$2.93
$3.19
(8%)
Cleared Avg. DARTs per Account (Annualized)
197
172
15%
(1) Excludes non-Customers. (2) Commissionable Order - a
customer order that generates commissions.
INTERACTIVE BROKERS GROUP, INC. AND
SUBSIDIARIES
NET INTEREST MARGIN
(UNAUDITED)
Three Months
Ended March 31,
2024
2023
(in millions)
Average interest-earning assets Segregated cash and
securities
$
61,132
$
59,679
Customer margin loans
46,653
39,303
Securities borrowed
5,368
4,868
Other interest-earning assets
9,952
9,777
FDIC sweeps1
3,861
2,428
$
126,966
$
116,055
Average interest-bearing liabilities
Customer credit balances
$
99,510
$
95,802
Securities loaned
11,734
8,571
Other interest-bearing liabilities
-
1
$
111,244
$
104,374
Net interest income
Segregated cash and securities, net
$
764
$
603
Customer margin loans2
678
477
Securities borrowed and loaned, net
26
88
Customer credit balances, net2
(881
)
(653
)
Other net interest income1/3
175
125
Net interest income3
$
762
$
640
Net interest margin ("NIM")
2.41
%
2.24
%
Annualized yields
Segregated cash and securities
5.03
%
4.10
%
Customer margin loans
5.85
%
4.92
%
Customer credit balances
3.56
%
2.76
%
______________________________
1
Represents the average amount of
customer cash swept into FDIC-insured banks as part of our Insured
Bank Deposit Sweep Program. This item is not recorded in the
Company's consolidated statements of financial condition. Income
derived from program deposits is reported in other net interest
income in the table above.
2
Interest income and interest
expense on customer margin loans and customer credit balances,
respectively, are calculated on daily cash balances within each
customer’s account on a net basis, which may result in an offset of
balances across multiple account segments (e.g., between securities
and commodities segments).
3
Includes income from financial
instruments that has the same characteristics as interest, but is
reported in other fees and services and other income in the
Company’s consolidated statements of comprehensive income. For the
three months ended March 31, 2024 and 2023, $6 million and $3
million were reported in other fees and services, respectively. For
the three months ended March 31, 2024 and 2023, $9 million and $0
million were reported in other income, respectively.
INTERACTIVE BROKERS GROUP, INC. AND
SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL
MEASURES
(UNAUDITED)
Three Months
Ended March 31,
2024
2023
(in millions)
Adjusted net revenues1 Net revenues - GAAP
$
1,203
$
1,056
Non-GAAP adjustments
Currency diversification strategy, net
2
(1
)
Mark-to-market on investments2
11
(40
)
Total non-GAAP adjustments
13
(41
)
Adjusted net revenues
$
1,216
$
1,015
Adjusted income before income taxes1
Income before income taxes - GAAP
$
866
$
761
Non-GAAP adjustments
Currency diversification strategy, net
2
(1
)
Mark-to-market on investments2
11
(40
)
Total non-GAAP adjustments
13
(41
)
Adjusted income before income taxes
$
879
$
720
Adjusted pre-tax profit margin
72
%
71
%
Three Months Ended March 31,
2024
2023
(in millions) Adjusted net income available for common
stockholders1 Net income available for common stockholders -
GAAP
$
175
$
148
Non-GAAP adjustments
Currency diversification strategy, net
0
0
Mark-to-market on investments2
3
(10
)
Income tax effect of above adjustments3
(1
)
2
Total non-GAAP adjustments
2
(8
)
Adjusted net income available for common stockholders
$
177
$
140
Note: Amounts may not add due to rounding.
Three
Months Ended March 31,
2024
2023
(in dollars) Adjusted diluted EPS1 Diluted EPS - GAAP
$
1.61
$
1.42
Non-GAAP adjustments
Currency diversification strategy, net
0.00
(0.00
)
Mark-to-market on investments2
0.03
(0.09
)
Income tax effect of above adjustments3
(0.01
)
0.02
Total non-GAAP adjustments
0.02
(0.07
)
Adjusted diluted EPS
$
1.64
$
1.35
Diluted weighted average common shares outstanding
108,149,440
104,042,571
Note: Amounts may not add due to rounding.
Note: The term “GAAP” in the following explanation refers to
generally accepted accounting principles in the United States.
1 Adjusted net revenues, adjusted income before income taxes,
adjusted net income available for common stockholders and adjusted
diluted earnings per share (“EPS”) are non-GAAP financial
measures.
- We define adjusted net revenues as net revenues adjusted to
remove the effect of our currency diversification strategy and our
net mark-to-market gains (losses) on investments2.
- We define adjusted income before income taxes as income before
income taxes adjusted to remove the effect of our currency
diversification strategy and our net mark-to-market gains (losses)
on investments.
- We define adjusted net income available to common stockholders
as net income available for common stockholders adjusted to remove
the after-tax effects attributable to IBG, Inc. of our currency
diversification strategy and our net mark-to-market gains (losses)
on investments.
- We define adjusted diluted EPS as adjusted net income available
for common stockholders divided by the diluted weighted average
number of shares outstanding for the period.
Management believes these non-GAAP items are important measures
of our financial performance because they exclude certain items
that may not be indicative of our core operating results and
business outlook and may be useful to investors and analysts in
evaluating the operating performance of the business and
facilitating a meaningful comparison of our results in the current
period to those in prior and future periods. Our currency
diversification strategy and our mark-to-market on investments are
excluded because management does not believe they are indicative of
our underlying core business performance. Adjusted net revenues,
adjusted income before income taxes, adjusted net income available
to common stockholders and adjusted diluted EPS should be
considered in addition to, rather than as a substitute for, GAAP
net revenues, income before income taxes, net income attributable
to common stockholders and diluted EPS.
2 Mark-to-market on investments represents the net
mark-to-market gains (losses) on investments in equity securities
that do not qualify for equity method accounting which are measured
at fair value, on our U.S. government and municipal securities
portfolio, which are typically held to maturity, and on certain
other investments, including equity securities taken over by the
Company from customers related to losses on margin loans.
3 The income tax effect is estimated using the statutory income
tax rates applicable to the Company.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240416986944/en/
For Interactive Brokers Group, Inc. Investors: Nancy Stuebe,
investor-relations@ibkr.com or Media: Rob Garfield,
media@ibkr.com.
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