INTL FCStone Inc. Reports Fiscal 2018 Fourth Quarter Financial Results
Annual Net Income of
Record Annual Operating Revenues of
EPS of
Sean M. O’Connor, CEO of
We were able to realize operating leverage by holding our fixed expense growth to 6% while significantly growing both volumes and operating revenues. This strong growth was indicative both of more favorable market conditions as well as market share gains across our platforms.”
Consolidated financial statements for the Company will be included in our Annual Report on Form 10-K to be filed with the
Three Months Ended September 30, | Fiscal Year Ended September 30, | ||||||||||||||||||||
(Unaudited) (in millions, except share and per share amounts) | 2018 | 2017 | % Change |
2018 | 2017 | % Change |
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Revenues: | |||||||||||||||||||||
Sales of physical commodities | $ | 5,846.0 | $ | 12,187.0 | (52 | )% | $ | 26,682.4 | $ | 28,673.3 | (7 | )% | |||||||||
Trading gains, net | 92.2 | 85.3 | 8 | % | 389.1 | 332.2 | 17 | % | |||||||||||||
Commission and clearing fees | 85.2 | 70.9 | 20 | % | 356.8 | 283.4 | 26 | % | |||||||||||||
Consulting, management, and account fees | 17.7 | 17.3 | 2 | % | 71.1 | 65.0 | 9 | % | |||||||||||||
Interest income | 37.7 | 22.0 | 71 | % | 123.3 | 69.7 | 77 | % | |||||||||||||
Total revenues | 6,078.8 | 12,382.5 | (51 | )% | 27,622.7 | 29,423.6 | (6 | )% | |||||||||||||
Cost of sales of physical commodities | 5,835.6 | 12,177.4 | (52 | )% | 26,646.9 | 28,639.6 | (7 | )% | |||||||||||||
Operating revenues | 243.2 | 205.1 | 19 | % | 975.8 | 784.0 | 24 | % | |||||||||||||
Transaction-based clearing expenses | 43.1 | 35.1 | 23 | % | 179.7 | 136.3 | 32 | % | |||||||||||||
Introducing broker commissions | 32.4 | 26.9 | 20 | % | 133.8 | 113.0 | 18 | % | |||||||||||||
Interest expense | 25.3 | 12.0 | 111 | % | 80.7 | 42.1 | 92 | % | |||||||||||||
Net operating revenues | 142.4 | 131.1 | 9 | % | 581.6 | 492.6 | 18 | % | |||||||||||||
Compensation and other expenses: | |||||||||||||||||||||
Compensation and benefits | 85.4 | 73.0 | 17 | % | 337.7 | 295.7 | 14 | % | |||||||||||||
Trade systems and market information | 9.0 | 8.7 | 3 | % | 34.7 | 34.4 | 1 | % | |||||||||||||
Occupancy and equipment rental | 4.0 | 4.1 | (2 | )% | 16.5 | 15.2 | 9 | % | |||||||||||||
Professional fees | 4.7 | 3.3 | 42 | % | 18.1 | 15.2 | 19 | % | |||||||||||||
Travel and business development | 3.6 | 3.7 | (3 | )% | 13.8 | 13.3 | 4 | % | |||||||||||||
Non-trading technology and support | 3.6 | 2.7 | 33 | % | 13.9 | 11.6 | 20 | % | |||||||||||||
Depreciation and amortization | 3.2 | 2.6 | 23 | % | 11.6 | 9.8 | 18 | % | |||||||||||||
Communications | 1.3 | 1.1 | 18 | % | 5.4 | 5.0 | 8 | % | |||||||||||||
Bad debts | 1.2 | 0.4 | 200 | % | 3.1 | 4.3 | (28 | )% | |||||||||||||
Bad debt on physical coal | — | 47.0 | (100 | )% | 1.0 | 47.0 | (98 | )% | |||||||||||||
Other | 5.9 | 7.0 | (16 | )% | 26.3 | 25.9 | 2 | % | |||||||||||||
Total compensation and other expenses | 121.9 | 153.6 | (21 | )% | 482.1 | 477.4 | 1 | % | |||||||||||||
Other gain | — | — | — | 2.0 | — | n/m | |||||||||||||||
Income (loss) before tax | 20.5 | (22.5 | ) | n/m | 101.5 | 15.2 | 568 | % | |||||||||||||
Income tax expense | 4.8 | 1.1 | 336 | % | 46.0 | 8.8 | 423 | % | |||||||||||||
Net income (loss) | $ | 15.7 | $ | (23.6 | ) | n/m | $ | 55.5 | $ | 6.4 | 767 | % | |||||||||
Earnings (loss) per share: | |||||||||||||||||||||
Basic | $ | 0.83 | $ | (1.27 | ) | n/m | $ | 2.93 | $ | 0.32 | 816 | % | |||||||||
Diluted | $ | 0.81 | $ | (1.27 | ) | n/m | $ | 2.87 | $ | 0.31 | 826 | % | |||||||||
Weighted-average number of common shares outstanding: | |||||||||||||||||||||
Basic | 18,620,718 | 18,485,150 | 1 | % | 18,549,011 | 18,395,987 | 1 | % | |||||||||||||
Diluted | 18,992,960 | 18,485,150 | 3 | % | 18,934,830 | 18,687,354 | 1 | % | |||||||||||||
n/m = not meaningful to present as a percentage | |||||||||||||||||||||
Impact of Tax Reform and Bad Debt on Physical Coal, Net of Incentive Recapture
The table below presents income (loss) before tax, income tax expense, net income (loss), diluted earnings (loss) per share and return (loss) on average stockholders’ equity as reported in accordance with Generally Accepted Accounting Principles (“GAAP”). The table below also presents adjusted income before tax, adjusted income tax expense, adjusted net income, adjusted diluted earnings per share and adjusted return on average stockholders’ equity, which are non-GAAP measures. The “adjusted” non-GAAP amounts reflect each item after removing the impacts of H.R. 1, the Tax Cuts and Jobs Act (“Tax Reform”) and the bad debt on physical coal, net of incentive recapture for the last eight fiscal quarters. Management believes that presenting our results excluding Tax Reform and the bad debt on physical coal, net of incentive recapture is meaningful, as it increases the comparability of period-to-period results.
Three Months Ended | |||||||||||||||||||||||||||||||
(in millions) | September 30, 2018 |
June 30, 2018 |
March 31, 2018 |
December 31, 2017 |
September 30, 2017 |
June 30, 2017 |
March 31, 2017 |
December 31, 2016 |
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As reported, GAAP: | |||||||||||||||||||||||||||||||
Income (loss) before tax | $ | 20.5 | $ | 32.9 | $ | 29.5 | $ | 18.6 | $ | (22.5 | ) | $ | 15.0 | $ | 14.3 | $ | 8.4 | ||||||||||||||
Income tax expense | (4.8 | ) | (8.9 | ) | (6.8 | ) | (25.5 | ) | (1.1 | ) | (2.3 | ) | (3.3 | ) | (2.1 | ) | |||||||||||||||
Net income (loss) | $ | 15.7 | $ | 24.0 | $ | 22.7 | $ | (6.9 | ) | $ | (23.6 | ) | $ | 12.7 | $ | 11.0 | $ | 6.3 | |||||||||||||
Diluted earnings (loss) per share | $ | 0.81 | $ | 1.25 | $ | 1.18 | $ | (0.37 | ) | $ | (1.27 | ) | $ | 0.66 | $ | 0.58 | $ | 0.34 | |||||||||||||
Return (loss) on average stockholders’ equity | 12.7 | % | 20.1 | % | 19.9 | % | (6.2 | )% | (20.5 | )% | 10.9 | % | 9.8 | % | 5.8 | % | |||||||||||||||
Adjusted (non-GAAP) (a): | |||||||||||||||||||||||||||||||
Adjusted income before tax | $ | 20.5 | $ | 32.9 | $ | 29.5 | $ | 19.6 | $ | 20.2 | $ | 15.0 | $ | 14.3 | $ | 8.4 | |||||||||||||||
Adjusted income tax expense | (5.1 | ) | (8.9 | ) | (7.6 | ) | (4.6 | ) | (4.4 | ) | (2.3 | ) | (3.3 | ) | (2.1 | ) | |||||||||||||||
Adjusted net income | $ | 15.4 | $ | 24.0 | $ | 21.9 | $ | 15.0 | $ | 15.8 | $ | 12.7 | $ | 11.0 | $ | 6.3 | |||||||||||||||
Adjusted diluted earnings per share | $ | 0.80 | $ | 1.25 | $ | 1.15 | $ | 0.78 | $ | 0.83 | $ | 0.66 | $ | 0.58 | $ | 0.34 | |||||||||||||||
Adjusted return on average stockholders’ equity | 11.1 | % | 17.9 | % | 17.0 | % | 12.1 | % | 13.2 | % | 10.9 | % | 9.8 | % | 5.8 | % |
(a) Adjusted income before tax, adjusted income tax expense, adjusted net income, adjusted diluted earnings per share and adjusted return on average stockholders’ equity are non-GAAP measures. A reconciliation between the GAAP and non-GAAP amounts listed above is provided in Appendix A.
Interest Income/Expense
Overall interest income increased
We currently maintain U.S. Treasury bills, interest earning cash deposits with banks, clearing organizations and counterparties as part of our interest rate management strategy.
Interest expense increased 111% to
Non-interest Expenses and Key Operating Metrics
The following table reflects a breakout of total non-interest expenses by variable and non-variable components, which is used by management in evaluating our non-interest expenses, for the periods indicated.
Three Months Ended September 30, | Fiscal Year Ended September 30, | ||||||||||||||||||
(in millions) | 2018 | 2017 | % Change |
2018 | 2017 | % Change |
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Variable compensation and benefits | $ | 44.5 | $ | 34.0 | 31% | $ | 174.1 | $ | 138.7 | 26% | |||||||||
Transaction-based clearing expenses | 43.1 | 35.1 | 23% | 179.7 | 136.3 | 32% | |||||||||||||
Introducing broker commissions | 32.4 | 26.9 | 20% | 133.8 | 113.0 | 18% | |||||||||||||
Total variable expenses | 120.0 | 96.0 | 25% | 487.6 | 388.0 | 26% | |||||||||||||
Fixed compensation and benefits | 40.9 | 39.0 | 5% | 163.6 | 157.0 | 4% | |||||||||||||
Other fixed expenses | 35.3 | 33.2 | 6% | 140.3 | 130.4 | 8% | |||||||||||||
Bad debts | 1.2 | 0.4 | 200% | 3.1 | 4.3 | (28)% | |||||||||||||
Bad debt on physical coal | — | 47.0 | (100)% | 1.0 | 47.0 | (98)% | |||||||||||||
Total non-variable expenses | 77.4 | 119.6 | (35)% | 308.0 | 338.7 | (9)% | |||||||||||||
Total non-interest expenses | $ | 197.4 | $ | 215.6 | (8)% | $ | 795.6 | $ | 726.7 | 9% | |||||||||
The following table reflects key operating metrics used by management in evaluating our product lines, for the periods indicated.
Three Months Ended September 30, | Fiscal Year Ended September 30, | ||||||||||||||||||
2018 | 2017 | % Change |
2018 | 2017 | % Change |
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Volumes and Other Data: | |||||||||||||||||||
Exchange-traded - futures and options (contracts, 000’s) | 31,295.8 | 25,385.4 | 23% | 129,486.5 | 99,148.4 | 31% | |||||||||||||
OTC (contracts, 000’s) | 417.1 | 374.6 | 11% | 1,582.9 | 1,410.0 | 12% | |||||||||||||
Global Payments (# of payments, 000’s) | 158.3 | 172.8 | (8)% | 639.5 | 648.9 | (1)% | |||||||||||||
Gold equivalent ounces traded (000’s) | 90,727.5 | 49,113.1 | 85% | 251,530.2 | 137,235.3 | 83% | |||||||||||||
Equity Capital Markets (gross dollar volume, millions) | $ | 30,683.1 | $ | 20,505.1 | 50% | $ | 117,771.7 | $ | 87,789.8 | 34% | |||||||||
Debt Capital Markets (gross dollar volume, millions) | $ | 42,417.0 | $ | 30,701.1 | 38% | $ | 134,032.0 | $ | 133,352.3 | 1% | |||||||||
FX Prime Brokerage volume (U.S. notional, millions) | $ | 70,938.0 | $ | 133,772.3 | (47)% | $ | 401,116.9 | $ | 620,917.8 | (35)% | |||||||||
Average assets under management in Argentina (U.S. dollar, millions) | $ | 297.9 | $ | 547.6 | (46)% | $ | 424.9 | $ | 564.9 | (25)% | |||||||||
Average client equity - futures and options (millions) | $ | 2,280.8 | $ | 2,031.1 | 12% | $ | 2,180.4 | $ | 2,015.9 | 8% |
Balance Sheet Summary
The following table below provides a summary of asset, liability, and stockholders’ equity information for the periods indicated.
(in millions, except for share and per share amounts) | September 30, 2018 |
September 30, 2017 |
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Summary asset information: | |||||||
Cash and cash equivalents | $ | 342.3 | $ | 314.9 | |||
Cash, securities and other assets segregated under federal and other regulations | $ | 1,408.7 | $ | 518.8 | |||
Securities purchased under agreements to resell | $ | 870.8 | $ | 406.6 | |||
Securities borrowed | $ | 225.5 | $ | 86.6 | |||
Deposits with and receivables from broker-dealers, clearing organizations and counterparties | $ | 2,234.5 | $ | 2,625.1 | |||
Receivables from clients, net and notes receivable | $ | 291.8 | $ | 243.3 | |||
Financial instruments owned, at fair value | $ | 2,054.8 | $ | 1,731.8 | |||
Physical commodities inventory | $ | 222.5 | $ | 124.8 | |||
Goodwill and intangible assets, net | $ | 59.8 | $ | 59.4 | |||
Other | $ | 114.0 | $ | 132.1 | |||
Summary liability and stockholders’ equity information: | |||||||
Payables to clients | $ | 3,639.6 | $ | 3,072.9 | |||
Payables to broker-dealers, clearing organizations and counterparties | $ | 89.5 | $ | 125.7 | |||
Payables to lenders under loans | $ | 355.2 | $ | 230.2 | |||
Accounts payable and other accrued liabilities | $ | 145.4 | $ | 135.6 | |||
Securities sold under agreements to repurchase | $ | 1,936.7 | $ | 1,393.1 | |||
Securities loaned | $ | 277.9 | $ | 111.1 | |||
Financial instruments sold, not yet purchased, at fair value | $ | 866.5 | $ | 717.6 | |||
Income taxes payable | $ | 8.6 | $ | 7.3 | |||
Stockholders’ equity | $ | 505.3 | $ | 449.9 | |||
Common stock outstanding - shares | 18,908,540 | 18,733,286 | |||||
Net asset value per share | $ | 26.72 | $ | 24.02 |
Segment Results
The following table reflects operating revenues by segment for the periods indicated.
Three Months Ended September 30, | Fiscal Year Ended September 30, | ||||||||||||||||||||
(in millions) | 2018 | 2017 | % Change |
2018 | 2017 | % Change |
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Segment operating revenues (loss) represented by: | |||||||||||||||||||||
Commercial Hedging | $ | 69.0 | $ | 67.3 | 3 | % | $ | 286.7 | $ | 244.6 | 17 | % | |||||||||
Global Payments | 25.2 | 22.1 | 14 | % | 99.2 | 89.2 | 11 | % | |||||||||||||
Securities | 47.8 | 36.4 | 31 | % | 196.2 | 151.7 | 29 | % | |||||||||||||
Physical Commodities | 15.9 | 11.8 | 35 | % | 56.9 | 44.8 | 27 | % | |||||||||||||
Clearing and Execution Services | 83.3 | 66.6 | 25 | % | 332.4 | 259.8 | 28 | % | |||||||||||||
Corporate unallocated | 2.0 | 0.9 | 122 | % | 4.4 | (6.1 | ) | n/m | |||||||||||||
Operating revenues | $ | 243.2 | $ | 205.1 | 19 | % | $ | 975.8 | $ | 784.0 | 24 | % | |||||||||
The following table reflects segment income by segment for the periods indicated.
Three Months Ended September 30, | Fiscal Year Ended September 30, | ||||||||||||||||||||
(in millions) | 2018 | 2017 | % Change |
2018 | 2017 | % Change |
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Segment income (loss) represented by: | |||||||||||||||||||||
Commercial Hedging | $ | 22.4 | $ | 22.4 | — | % | $ | 96.4 | $ | 72.8 | 32 | % | |||||||||
Global Payments | 15.7 | 12.8 | 23 | % | 59.8 | 50.6 | 18 | % | |||||||||||||
Securities | 6.7 | 9.1 | (26 | )% | 40.8 | 46.6 | (12 | )% | |||||||||||||
Physical Commodities | 4.8 | (42.6 | ) | n/m | 16.6 | (31.4 | ) | n/m | |||||||||||||
Clearing and Execution Services | 11.4 | 10.3 | 11 | % | 48.3 | 30.4 | 59 | % | |||||||||||||
Total segment income | $ | 61.0 | $ | 12.0 | 408 | % | $ | 261.9 | $ | 169.0 | 55 | % | |||||||||
Reconciliation of segment income to income before tax: | |||||||||||||||||||||
Segment income | $ | 61.0 | $ | 12.0 | 408 | % | $ | 261.9 | $ | 169.0 | 55 | % | |||||||||
Net costs not allocated to operating segments | 40.5 | 34.5 | 17 | % | 162.4 | 153.8 | 6 | % | |||||||||||||
Other gain | — | — | — | 2.0 | — | n/m | |||||||||||||||
Income (loss) before tax | $ | 20.5 | $ | (22.5 | ) | n/m | $ | 101.5 | $ | 15.2 | 568 | % | |||||||||
Commercial Hedging
In our Commercial Hedging segment, we serve our commercial clients through our team of risk management consultants, providing a high-value-added service that we believe differentiates us from our competitors and maximizes the opportunity to retain our clients. Our risk management consulting services are designed to quantify and monitor commercial entities’ exposure to commodity and financial risk. Upon assessing this exposure, we develop a plan to control and hedge these risks with post-trade reporting against specific client objectives. Our clients are assisted in the execution of their hedging strategies through a wide range of products from listed exchange-traded futures and options, to basic over-the-counter (“OTC”) instruments that offer greater flexibility and structured OTC products designed for customized solutions. These services span virtually all traded commodity markets, with the largest concentrations in agricultural and energy commodities (consisting primarily of grains, energy and renewable fuels, coffee, sugar, cotton, and food service) and base metals products listed on the London Metal Exchange (“LME”).
Operating revenues increased 3% to
OTC revenues decreased 13%, to
Consulting, management, and account fees were relatively unchanged compared to the prior year, while interest income increased 58%, to
Segment income was unchanged versus the prior year at
Our
Operating revenues increased 14% to
Segment income increased 23% to
Securities
In our Securities segment, we provide value-added solutions that facilitate cross border trading and believe our clients value our ability to manage complex transactions, including foreign exchange, utilizing our local understanding of market convention, liquidity and settlement protocols around the world. Our clients include U.S.-based regional and national broker-dealers and institutions seeking access to the U.S. securities markets. We act as an institutional dealer in fixed income securities, including U.S. Treasuries, U.S. government agency, agency mortgage-backed and asset-backed securities to a client base including asset managers, commercial bank trust and investment departments, broker-dealers and insurance companies. In addition, we also originate, structure and place debt instruments in the international and domestic capital markets as well as operate an asset management business in
Operating revenues increased 31% to
Operating revenues in our Securities segment are comprised of activities in three primary product lines,
Operating revenues in
Segment income decreased 26% to
Physical Commodities
In our Physical Commodities segment, we provide a full range of trading and hedging capabilities, including OTC products, to select producers, consumers and investors in precious metals. Additionally, we act as principal to facilitate financing, structured pricing and logistics services to clients across the commodity complex, including energy commodities, grains, oil seeds, cotton, coffee, cocoa, edible oils and feed products.
Operating revenues for Physical Commodities increased 35% to
Precious Metals operating revenues decreased 4% to
Operating revenues in Physical Ag & Energy increased 108% to
Physical Commodities recorded segment income of
Clearing and Execution Services
We provide competitive and efficient clearing and execution in all major futures and securities exchanges globally as well as prime brokerage in major foreign currency pairs and swap transactions. Through our platform, client orders are accepted and directed to the appropriate exchange for execution. We then facilitate the clearing of client transactions. Clearing involves the matching of client trades with the exchange, the collection and management of client margin deposits to support the transactions, and the accounting and reporting of the transactions to clients.
As of
We are an independent full-service provider to introducing broker-dealers (“IBD’s”) of clearing, custody, research, syndicated and security-based lending products and services, including a proprietary technology platform which offers seamless connectivity to ensure a positive client experience through the clearing and settlement process. Our independent wealth management business, which offers a comprehensive product suite to retail clients nationwide, clears through this platform. We believe we are one of the leading mid-market clearer’s in the securities industry, with approximately 50 correspondent clearing relationships with over
Within this segment, we also maintain what we believe is one of the largest non-bank prime brokers and swap dealers in the world. Through this offering, we provide prime brokerage foreign exchange (“FX”) services to financial institutions and professional traders. We provide our clients with the full range of OTC products, including 24-hour a day execution of spot, forwards and options as well as non-deliverable forwards in both liquid and exotic currencies. We also operate a proprietary foreign exchange desk that arbitrages the exchange-traded foreign exchange markets with the cash markets.
Through our
Operating revenues increased 25% to
Operating revenues in our Exchange-Traded Futures & Options business increased 56% to
Operating revenues in our FX Prime Brokerage decreased 23% compared to the prior year to
Correspondent Clearing operating revenues increased 14% compared to the prior year to
Segment income increased to
Conference Call & Web Cast
A conference call will be held tomorrow, Wednesday, December 12, 2018 at
A replay of the call will be available at http://www.intlfcstone.com approximately two hours after the call has ended and will be available through December 19, 2018. To access the replay, dial 1-855-859-2056 (within
About
Serving more than 20,000 clients in 130 countries on five continents, the company provides products and services across five market segments: commercial hedging, global payments, securities, physical commodities, and clearing and execution services. Our clients include the producers, processors and end users of virtually every major traded commodity, as well as asset managers, introducing broker-dealers, insurance companies, brokers, institutional and retail investors, commercial and investment banks, and governmental, non-governmental and charitable organizations. A Fortune 500 company headquartered in
Further information on INTL is available at www.intlfcstone.com.
Forward Looking Statements
This press release includes forward-looking statements including statements regarding the combined company. All statements other than statements of current or historical fact contained in this press release are forward-looking statements. The words “believe,” “expect,” “anticipate,” “should,” “plan,” “will,” “may,” “could,” “intend,” “estimate,” “predict,” “potential,” “continue” or the negative of these terms and similar expressions, as they relate to
These forward-looking statements are largely based on current expectations and projections about future events and financial trends that may affect the financial condition, results of operations, business strategy and financial needs of the company. They can be affected by inaccurate assumptions, including the risks, uncertainties and assumptions described in the filings made by
These forward-looking statements speak only as of the date of this press release.
Investor inquiries:
1-866-522-7188
bruce.fields@intlfcstone.com
Appendix A
The “adjusted” non-GAAP amounts reflect each item after removing the impacts of Tax Reform and the bad debt on physical coal, net of incentive recapture for the last eight fiscal quarters. Management believes that presenting our results excluding Tax Reform and the bad debt on physical coal, net of incentive recapture is meaningful, as it increases the comparability of period-to-period results.
Three Months Ended | |||||||||||||||||||||||||||||||
(in millions) | September 30, 2018 |
June 30, 2018 |
March 31, 2018 |
December 31, 2017 |
September 30, 2017 |
June 30, 2017 |
March 31, 2017 |
December 31, 2016 |
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Reconciliation of income (loss) before tax to adjusted non-GAAP amounts: | |||||||||||||||||||||||||||||||
Income (loss) before tax, as reported (GAAP) | $ | 20.5 | $ | 32.9 | $ | 29.5 | $ | 18.6 | $ | (22.5 | ) | $ | 15.0 | $ | 14.3 | $ | 8.4 | ||||||||||||||
Bad debt on physical coal, net of incentive recapture (a) | — | — | — | 1.0 | 42.7 | — | — | — | |||||||||||||||||||||||
Adjusted income before tax (non-GAAP) | $ | 20.5 | $ | 32.9 | $ | 29.5 | $ | 19.6 | $ | 20.2 | $ | 15.0 | $ | 14.3 | $ | 8.4 | |||||||||||||||
Reconciliation of income tax expense to adjusted non-GAAP amounts: | |||||||||||||||||||||||||||||||
Income tax expense, as reported (GAAP) | $ | (4.8 | ) | $ | (8.9 | ) | $ | (6.8 | ) | $ | (25.5 | ) | $ | (1.1 | ) | $ | (2.3 | ) | $ | (3.3 | ) | $ | (2.1 | ) | |||||||
Tax effect of bad debt on physical coal, net of incentive recapture | — | — | — | — | (3.3 | ) | — | — | — | ||||||||||||||||||||||
Impact of Tax Reform (b) | (0.3 | ) | — | (0.8 | ) | 20.9 | — | — | — | — | |||||||||||||||||||||
Adjusted income tax expense (non-GAAP) | $ | (5.1 | ) | $ | (8.9 | ) | $ | (7.6 | ) | $ | (4.6 | ) | $ | (4.4 | ) | $ | (2.3 | ) | $ | (3.3 | ) | $ | (2.1 | ) | |||||||
Reconciliation of net income (loss) to adjusted non-GAAP amounts: | |||||||||||||||||||||||||||||||
Net income (loss), as reported (GAAP) | $ | 15.7 | $ | 24.0 | $ | 22.7 | $ | (6.9 | ) | $ | (23.6 | ) | $ | 12.7 | $ | 11.0 | $ | 6.3 | |||||||||||||
Bad debt on physical coal, net of incentive recapture, net of tax | — | — | — | 1.0 | 39.4 | — | — | — | |||||||||||||||||||||||
Impact of Tax Reform | (0.3 | ) | — | (0.8 | ) | 20.9 | — | — | — | — | |||||||||||||||||||||
Adjusted net income (non-GAAP) | $ | 15.4 | $ | 24.0 | $ | 21.9 | $ | 15.0 | $ | 15.8 | $ | 12.7 | $ | 11.0 | $ | 6.3 | |||||||||||||||
Three Months Ended | |||||||||||||||||||||||||||||||
(in millions) | September 30, 2018 |
June 30, 2018 |
March 31, 2018 |
December 31, 2017 |
September 30, 2017 |
June 30, 2017 |
March 31, 2017 |
December 31, 2016 |
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Calculation of adjusted diluted earnings per share: | |||||||||||||||||||||||||||||||
Adjusted net income (non-GAAP) | $ | 15.4 | $ | 24.0 | $ | 21.9 | $ | 15.0 | $ | 15.8 | $ | 12.7 | $ | 11.0 | $ | 6.3 | |||||||||||||||
Less: Allocation to participating securities (c) | (0.3 | ) | (0.3 | ) | (0.3 | ) | (0.3 | ) | (0.3 | ) | (0.3 | ) | (0.2 | ) | (0.1 | ) | |||||||||||||||
Adjusted net income allocated to common stockholders (non-GAAP) | $ | 15.1 | $ | 23.7 | $ | 21.6 | $ | 14.7 | $ | 15.5 | $ | 12.4 | $ | 10.8 | $ | 6.2 | |||||||||||||||
Divided by diluted weighted-average common shares used in the calculation of adjusted diluted earnings per share | 18,992,960 | 18,976,898 | 18,859,333 | 18,786,145 | 18,768,660 | 18,702,128 | 18,661,418 | 18,484,995 | |||||||||||||||||||||||
Adjusted diluted earnings per share (non-GAAP) | $ | 0.80 | $ | 1.25 | $ | 1.15 | $ | 0.78 | $ | 0.83 | $ | 0.66 | $ | 0.58 | $ | 0.34 | |||||||||||||||
Three Months Ended | |||||||||||||||||||||||
(in millions) | September 30, 2018 |
June 30, 2018 |
March 31, 2018 |
December 31, 2017 |
September 30, 2017 |
June 30, 2017 |
March 31, 2017 |
December 31, 2016 |
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Calculation of diluted weighted-average common shares used in the calculation of adjusted diluted earnings per share: | |||||||||||||||||||||||
Weighted-average number of common shares outstanding, as reported | 18,620,718 | 18,597,165 | 18,559,849 | 18,419,072 | 18,485,150 | 18,447,053 | 18,404,236 | 18,248,244 | |||||||||||||||
Effect of dilutive securities (d) | 372,242 | 379,733 | 299,484 | 367,073 | 283,510 | 255,075 | 257,182 | 236,751 | |||||||||||||||
Diluted weighted-average common shares used in the calculation of adjusted diluted earnings per share | 18,992,960 | 18,976,898 | 18,859,333 | 18,786,145 | 18,768,660 | 18,702,128 | 18,661,418 | 18,484,995 | |||||||||||||||
(in millions) | September 30, 2018 |
June 30, 2018 |
March 31, 2018 |
December 31, 2017 |
September 30, 2017 |
June 30, 2017 |
March 31, 2017 |
December 31, 2016 |
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Reconciliation of stockholders’ equity to adjusted non-GAAP amounts: | |||||||||||||||||||||||||||||||
Stockholders’ equity, as reported | $ | 505.3 | $ | 487.7 | $ | 466.6 | $ | 443.2 | $ | 449.9 | $ | 469.1 | $ | 455.7 | $ | 442.6 | |||||||||||||||
Bad debt on physical coal, net of incentive recapture, net of tax | 40.4 | 40.4 | 40.4 | 40.4 | 39.4 | — | — | — | |||||||||||||||||||||||
Impact of Tax Reform | 19.8 | 20.1 | 20.1 | 20.9 | — | — | — | — | |||||||||||||||||||||||
Adjusted stockholders’ equity (non-GAAP) | $ | 565.5 | $ | 548.2 | $ | 527.1 | $ | 504.5 | $ | 489.3 | $ | 469.1 | $ | 455.7 | $ | 442.6 | |||||||||||||||
(a) During the three months ended
(b) Impact of Tax Reform includes tax (benefit) expense of
(c) For the three months ended December 31, 2017 and September 30, 2017, there were no amounts allocated to participating securities, as reported, due to net losses in each of the periods. In conjunction with the consideration of adjusted net income (non-GAAP), amounts allocated to participating securities has now been included for the periods. For the three months ended September 30, 2018, June 30, 2018, March 31, 2018, June 30, 2017, March 31, 2017 and December 31, 2016, the amounts allocated to participating securities are included as reported.
(d) For the three months ended December 31, 2017 and September 30, 2017, there were no amount of dilutive securities, as reported, due to net losses in each of the periods. In conjunction with the consideration of adjusted net income (non-GAAP), an amount of dilutive securities has now been included for the periods. For the three months ended September 30, 2018, June 30, 2018, March 31, 2018, June 30, 2017, March 31, 2017 and December 31, 2016, the dilutive securities are included as reported.
Source: INTL FCStone Inc.