Leading multi-bank FX portal, FXall, has submitted its quarterly earnings for the second quarter of 2012. Results look promising as overall FX volumes have been on the up since a difficult first quarter. In addition, the ECN venue was a recent target of a major merger in the FX markets after Thomson Reuters put a bid forward.
Three Months Ended June 30, 2012 Compared to Three Months Ended June 30, 2011
Total Revenues
FXall’s total revenues increased $2.0 million, or 7%, to $31.4 million for the three months ended June 30, 2012, compared to $29.4 million for the three months ended June 30, 2011. The increase in total revenues was primarily attributable to an increase in transaction fees of $1.2 million and an increase in user, settlement and license fees of $0.8 million.
Transaction fees—relationship trading.
Transaction fees—relationship trading increased $0.3 million, or 2%, to $16.1 million for the three months ended June 30, 2012, compared to $15.8 million for the three months ended June 30, 2011. The increase in revenues was driven by a 5% increase in trading volume due primarily to an increase in the number of relationship trading clients. This increase was partially offset by a decrease in the average volume per client and decrease in the average transaction fee per million of 3%, primarily due to a change in product mix and our tiered volume pricing model.
Transaction fees—active trading
Transaction fees—active trading increased $0.9 million, or 13%, to $7.9 million for the three months ended June 30, 2012, compared to $7.0 million for the three months ended June 30, 2011. The increase in revenues was driven by an 18% increase in trading volume due primarily due to an increase in active trading clients. This increase was partially offset by a decrease in the average volume per client and a decrease in the average transaction fee per million of 4% primarily due to tiered volume pricing.
User, settlement, and license fees
User, settlement, and license fees increased $0.8 million, or 12%, to $7.4 million for the three months ended June 30, 2012, compared to $6.6 million for the three months ended June 30, 2011. The increase was primarily attributable to $0.4 million in increased license fees for our white-labeled enterprise solutions and $0.2 million in increased fees related to post-trade messaging for transaction settlement.
FXall competes with Currenex and Hotspot in the core ECN market. Hotspot, part of the Knight Group had a dim end to last week as a major computer glitch caused a loss of $440 million. The loss could force Knight into bankruptcy.
