FX Alliance Inc. (FX), the electronic foreign-exchange platform provider better known as FXall, reported a surge in fourth-quarter net profit, but also saw a quarterly drop in average trading volumes.

In its first earnings report since its stock market debut in February, FXall said Thursday that its average daily volume in the three months to the end of 2011 was $82.1 billion--a 23% increase compared with a year earlier but still 7.3% down on the third quarter.

"While our trading volumes in the fourth quarter were impacted by weakness in the overall foreign exchange market, we still generated solid financial results," Phil Weisberg, FXall's chairman and chief executive, said in a statement.

Fourth-quarter net profit was $7.8 million, compared with $5.1 million a year earlier. Despite the slip in trading volumes, FXall's revenue in the fourth quarter grew 16% on the year to $29.6 million. Over the full year, revenue increased 19% to $118.3 million.

The decline in currency trades handled by FXall in the last three months of 2011 is in line with the trend seen at other electronic currency brokers such as ICAP-owned EBS (IAP.LN) and Thomson Reuters Corp. (TRI), which have also continued to report slides in trading activity so far in 2012.

EBS said Wednesday that its daily average volumes in February fell 9% on the year to $126.7 billion, while Thomson Reuters reported a 5% drop to $136 billion over the same period.

A semi-annual report published last month by four major central banks, including the Bank of England and the Federal Reserve, showed a drop in global foreign-exchange trading volumes for the first time since 2009.

-By Eva Szalay, Dow Jones Newswires; 44 20 7842 9305; eva.szalay@dowjones.com

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