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Release Details

Virtu Announces Fourth Quarter 2021 Results

February 8, 2022

NEW YORK, Feb. 08, 2022 (GLOBE NEWSWIRE) -- Virtu Financial, Inc. (NASDAQ: VIRT), a leading provider of financial services and products that leverages cutting edge technology to deliver innovative, transparent trading solutions to its clients and liquidity to the global markets, today reported results for the fourth quarter ended December 31, 2021.

Fourth Quarter and Full Year Selected Highlights

Fourth Quarter 2021:

  • Net income of $186.0 million; Normalized Adjusted Net Income1 of $220.6 million
  • Basic and diluted earnings per share of $0.90 and $0.89 respectively; Normalized Adjusted EPS1 of $1.19
  • Total revenues of $705.6 million; Trading income, net, of $513.4 million; Adjusted Net Trading Income1 of $485.6 million
  • Adjusted EBITDA1 of $328.4 million; Adjusted EBITDA Margin1 of 67.6%
  • Share buybacks of $101.6 million, or 3.7 million shares, under the Share Repurchase Program2
     

Full Year 2021:

  • Net income of $827.2 million; Normalized Adjusted Net Income1 of $876.6 million
  • Basic and diluted earnings per share of $3.95 and $3.91 respectively; Normalized Adjusted EPS1 of $4.57
  • Total revenues of $2,811.5 million; Trading income, net of $2,105.2 million; Adjusted Net Trading Income1 of $1,909.9 million
  • Adjusted EBITDA1 of $1,301.2 million; Adjusted EBITDA Margin1 of 68.1%
  • Share buybacks of $405.2 million, or 14.7 million shares, under the Share Repurchase Program2
     

The Virtu Financial, Inc. Board of Directors declared a quarterly cash dividend of $0.24 per share. This dividend is payable on March 15, 2022 to shareholders of record as of March 1, 2022.

Note 1: Non-GAAP financial measures. Please see "Non-GAAP Financial Measures and Other Items" for more information.
Note 2: Shares repurchased calculated on a settlement date basis.

Financial Results

Fourth Quarter 2021:

Total revenues increased 4.3% to $705.6 million for this quarter, driven primarily by higher trading volumes in U.S. equities, compared to $676.7 million for the same period in 2020. Trading income, net, increased 1.6% to $513.4 million for this quarter, compared to $505.5 million for the same period in 2020. Net income totaled $186.0 million for this quarter, compared to net income of $197.7 million in the prior year quarter.

Basic and diluted earnings per share for this quarter were $0.90 and $0.89, compared to a basic and diluted earnings per share of $0.89 and $0.88, respectively, for the same period in 2020.

Adjusted Net Trading Income increased 6.5% to $485.6 million for this quarter, compared to $455.9 million for the same period in 2020. Adjusted EBITDA decreased 4.5% to $328.4 million for this quarter, compared to $343.9 million for the same period in 2020.

Normalized Adjusted Net Income, removing one-time integration costs and non-cash items, decreased 5.7% to $220.6 million for this quarter, compared to $234.0 million for the same period in 2020.

Assuming all non-controlling interests had been exchanged for common stock, and the Company’s Normalized Adjusted Net Income before income taxes was subject to corporation taxes, Normalized Adjusted EPS was $1.19 for this quarter, compared to $1.18 for the same period in 2020.

Full Year 2021:

Total revenues decreased 13.2% to $2,811.5 million for this year, also impacted by lower volatility and volumes across global markets, compared to $3,239.3 million for 2020, which had high volatility in the first and fourth quarters. Trading income, net, decreased 15.6% to $2,105.2 million for this year, compared to $2,493.2 million for 2020. There was net income of $827.2 million for this year, compared to net income of $1,120.9 million for 2020.

Basic and diluted earnings per share were $3.95 and $3.91 for 2021, compared to basic and diluted earnings per share of $5.19 and $5.16, respectively, for the same period in 2020.

Adjusted Net Trading Income decreased 15.9% to $1,909.9 million for this year, compared to $2,271.4 million for 2020. Adjusted EBITDA decreased 21.0% to $1,301.2 million for this year, compared to $1,648.0 million for 2020. Normalized Adjusted Net Income decreased 22.8% to $876.6 million for this year, compared to $1,135.1 million for 2020.

Assuming all non-controlling interests had been exchanged for common stock, and the Company’s Normalized Adjusted Net Income before income taxes was subject to corporation taxes, Normalized Adjusted EPS was $4.57 for 2021, compared to $5.76 for 2020.

Operating Segment Information

The Company has two operating segments: Market Making and Execution Services; and one non-operating segment: Corporate.

Market Making principally consists of market making in the cash, futures and options markets across global equities, fixed income, currencies and commodities. As a market maker, the Company commits capital on a principal basis by offering to buy securities from, or sell securities to, broker dealers, banks and institutions.

Execution Services comprises agency-based trading and trading venues, offering execution services in global equities, options, futures and fixed income on behalf of institutions, banks and broker dealers. The Company also provides proprietary technology and infrastructure, workflow technology, and trading analytics services to select third parties. The segment also includes the results of the Company's capital markets business, in which the Company acts as an agent for issuers in connection with at-the-market offerings and buyback programs.

Corporate contains the Company's investments, principally in strategic trading-related opportunities, and maintains corporate overhead expenses.

The following tables show the trading income, net, total revenues and Adjusted Net Trading Income by segment for the three months and full years ended December 31, 2021 and 2020.

 

Total revenues by segment
(in thousands, unaudited)

    Three Months Ended December 31, 2021   Three Months Ended December 31, 2020
    Market Making   Execution Services   Corporate   Total   Market Making   Execution Services   Corporate   Total
Trading income, net   $ 508,306   $ 5,048   $     $ 513,354     $ 466,006   $ 39,486   $     $ 505,492
Commissions, net and technology services     8,844     134,958           143,802       42,926     105,250           148,176
Interest and dividends income     49,137     1           49,138       15,269     62           15,331
Other, net     1,204     290     (2,185 )     (691 )     4,841     4,725     (1,869 )     7,697
Total Revenues   $ 567,491   $ 140,297   $ (2,185 )   $ 705,603     $ 529,042   $ 149,523   $ (1,869 )   $ 676,696

 

                                 
    Year Ended December 31, 2021   Year Ended December 31, 2020
    Market Making   Execution Services   Corporate   Total   Market Making   Execution Services   Corporate   Total
Trading income, net   $ 2,079,653   $ 25,541   $   $ 2,105,194   $ 2,455,182   $ 38,006   $     $ 2,493,188
Commissions, net and technology services     40,955     573,534         614,489     52,453     548,057           600,510
Interest and dividends income     75,311     73         75,384     61,485     634           62,119
Other, net     7,127     1,067     8,224     16,418     24,222     63,386     (4,154 )     83,454
Total Revenues   $ 2,203,046   $ 600,215   $ 8,224   $ 2,811,485   $ 2,593,342   $ 650,083   $ (4,154 )   $ 3,239,271

Reconciliation of trading income, net to Adjusted Net Trading Income by operating segment
(in thousands, unaudited)

    Three Months Ended December 31, 2021   Three Months Ended December 31, 2020
    Market Making   Execution Services   Corporate   Total   Market Making   Execution Services   Corporate   Total
Trading income, net   $ 508,306     $ 5,048     $   $ 513,354     $ 466,006     $ 39,486     $   $ 505,492  
Commissions, net and technology services     8,844       134,958           143,802       42,926       105,250           148,176  
Interest and dividends income     49,137       1           49,138       15,269       62           15,331  
Brokerage, exchange, clearance fees and
payments for order flow, net
    (131,955 )     (24,594 )         (156,549 )     (175,760 )     (9,314 )         (185,074 )
Interest and dividends expense     (62,679 )     (1,440 )         (64,119 )     (27,653 )     (340 )         (27,993 )
Adjusted Net Trading Income   $ 371,653     $ 113,973     $   $ 485,626     $ 320,788     $ 135,144     $   $ 455,932  

 

                                 
    Year Ended December 31, 2021   Year Ended December 31, 2020
    Market Making   Execution Services   Corporate   Total   Market Making   Execution Services   Corporate   Total
Trading income, net   $ 2,079,653     $ 25,541     $   $ 2,105,194     $ 2,455,182     $ 38,006     $   $ 2,493,188  
Commissions, net and technology services     40,955       573,534           614,489       52,453       548,057           600,510  
Interest and dividends income     75,311       73           75,384       61,485       634           62,119  
Brokerage, exchange, clearance fees and
payments for order flow, net
    (634,783 )     (110,651 )         (745,434 )     (662,994 )     (95,849 )         (758,843 )
Interest and dividends expense     (133,584 )     (6,120 )         (139,704 )     (123,715 )     (1,934 )         (125,649 )
Adjusted Net Trading Income   $ 1,427,552     $ 482,377     $   $ 1,909,929     $ 1,782,411     $ 488,914     $   $ 2,271,325  

Financial Condition

As of December 31, 2021, Virtu had $1,121.0 million in cash, cash equivalents and restricted cash, and total long-term debt outstanding in an aggregate principal amount of $1,631.3 million.

Share Repurchase Program

Since inception of the program in November 2020 through January 31, 2022, the Company repurchased approximately 17.6 million shares of Class A Common Stock and Virtu Financial Units for approximately $482.8 million. Including the additional $750 million authorization from Virtu Financial Inc's Board of directors in the fourth quarter, 2021, the Company has approximately $737.2 million remaining capacity for future purchases of shares of Class A Common Stock and Virtu Financial Units under the program.

Earnings Conference Call Information

Virtu Financial will host a conference call to review its fourth quarter 2021 financial performance today, February 8th, at 8:30 a.m. ET. Members of the public may listen to the conference call through an audio webcast through the Investor Relations section of the firm’s website ir.virtu.com/investor-relations.

Website Information

We routinely post important information for investors on the Investor Relations section of our website, ir.virtu.com/investor-relations and also from time to time may use social media channels, including our Twitter account (twitter.com/virtufinancial) and our LinkedIn account (linkedin.com/company/virtu-financial), as an additional means of disclosing public information to investors, the media and others interested in us. It is possible that certain information we post on our website and on social media could be deemed to be material information, and we encourage investors, the media and others interested in us to review the business and financial information we post on our website and on the social media channels identified above, in addition to following our press releases, SEC filings, public conference calls, presentations and webcasts. The information contained on, or that may be accessed through, our website and our social media channels is not incorporated by reference into, and is not a part of, this document.

Non-GAAP Financial Measures and Other Items

To supplement our unaudited condensed consolidated financial statements presented in accordance with generally accepted accounting principles ("GAAP"), we use the following non-GAAP measures of financial performance:

  • "Adjusted Net Trading Income", which is the amount of revenue we generate from our market making activities, or trading income, net, plus commissions, net and technology services, plus interest and dividends income and expense, net, less direct costs associated with those revenues, including brokerage, exchange, clearance fees and payments for order flow, net. Management believes that this measurement is useful for comparing general operating performance from period to period. Although we use Adjusted Net Trading Income as a financial measure to assess the performance of our business, the use of Adjusted Net Trading Income is limited because it does not include certain material costs that are necessary to operate our business. Our presentation of Adjusted Net Trading Income should not be construed as an indication that our future results will be unaffected by revenues or expenses that are not directly associated with our market making activities.
     
  • "EBITDA", which measures our operating performance by adjusting Net Income to exclude financing interest expense on our long-term borrowings, debt issue cost related to debt refinancing, prepayment, and commitment fees, depreciation and amortization, amortization of purchased intangibles and acquired capitalized software, and income tax expense, and "Adjusted EBITDA", which measures our operating performance by further adjusting EBITDA to exclude severance, transaction advisory fees and expenses, termination of office leases, charges related to share based compensation and other expenses, which includes reserves for legal matters, COVID-19 one-time costs and donations and Other net, and “Adjusted EBITDA Margin”, which compares Adjusted EBITDA to Adjusted Net Trading Income.
     
  • “Normalized Adjusted Net Income”, “Normalized Adjusted Net Income before income taxes”, “Normalized provision for income taxes”, and “Normalized Adjusted EPS”, which we calculate by adjusting Net Income to exclude certain items and other non-cash items, assuming that all vested and unvested non-voting common interest units in Virtu Financial LLC have been exchanged for shares of our Class A common stock, and applying an effective tax rate, which was approximately 24%.
     
  • “Adjusted Operating Expenses”, which we calculate by adjusting total operating expenses to exclude severance, share based compensation, reserves for legal matters, termination of office leases, connectivity early termination and write-down of assets.
     

Adjusted Net Trading Income, EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin, Normalized Adjusted Net Income, Normalized Adjusted Net Income before income taxes, Normalized provision for income taxes, and Normalized Adjusted EPS and Adjusted Operating Expenses are non-GAAP financial measures used by management in evaluating operating performance and in making strategic decisions. Additional information provided regarding the breakdown of Total Adjusted Net Trading Income by category is also a non-GAAP financial measure but is not used by the Company in evaluating operating performance and in making strategic decisions. In addition, these non-GAAP financial measures or similar non-GAAP measures are used by research analysts, investment bankers and lenders to assess our operating performance. Management believes that the presentation of Adjusted Net Trading Income, EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin, Normalized Adjusted Net Income, Normalized Adjusted Net Income before income taxes, Normalized provision for income taxes and Normalized Adjusted EPS provide useful information to investors regarding our results of operations because they assist both investors and management in analyzing and benchmarking the performance and value of our business. Adjusted Net Trading Income, EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin, Normalized Adjusted Net Income, Normalized Adjusted Net Income before income taxes, Normalized provision for income taxes and Normalized Adjusted EPS provide indicators of general economic performance that are not affected by fluctuations in certain costs or other items. Accordingly, management believes that these measurements are useful for comparing general operating performance from period to period. Furthermore, our credit agreement contains tests based on metrics similar to Adjusted EBITDA. Other companies may define Adjusted Net Trading Income, Adjusted EBITDA, Adjusted EBITDA Margin, Normalized Adjusted Net Income, Normalized Adjusted Net Income before income taxes, Normalized provision for income taxes and Normalized Adjusted EPS differently, and as a result our measures of Adjusted Net Trading Income, Adjusted EBITDA, Adjusted EBITDA Margin, Normalized Adjusted Net Income, Normalized Adjusted Net Income before income taxes, Normalized provision for income taxes and Normalized Adjusted EPS may not be directly comparable to those of other companies. Although we use these non-GAAP financial measures as financial measures to assess the performance of our business, such use is limited because they do not include certain material costs necessary to operate our business.

Adjusted Net Trading Income, EBITDA, Adjusted EBITDA, Normalized Adjusted Net Income before income taxes, Normalized provision for income taxes, Normalized Adjusted Net Income and Normalized Adjusted EPS should be considered in addition to, and not as a substitute for, Net Income in accordance with U.S. GAAP as a measure of performance. Our presentation of Adjusted Net Trading Income, EBITDA, Adjusted EBITDA, Adjusted EBITDA Margin, Normalized Adjusted Net Income, Normalized Adjusted Net Income before income taxes, Normalized provision for income taxes and Normalized Adjusted EPS should not be construed as an indication that our future results will be unaffected by unusual or nonrecurring items. Adjusted Net Trading Income, Normalized Adjusted Net Income, Normalized Adjusted Net Income before income taxes, Normalized provision for income taxes, Normalized Adjusted EPS and our EBITDA-based measures have limitations as analytical tools, and you should not consider them in isolation or as substitutes for analysis of our results as reported under U.S. GAAP. Some of these limitations are:

  • they do not reflect every cash expenditure, future requirements for capital expenditures or contractual commitments;
  • our EBITDA-based measures do not reflect the significant interest expense or the cash requirements necessary to service interest or principal payment on our debt;
  • although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced or require improvements in the future, and our EBITDA-based measures do not reflect any cash requirement for such replacements or improvements;
  • they are not adjusted for all non-cash income or expense items that are reflected in our statements of cash flows;
  • they do not reflect the impact of earnings or charges resulting from matters we consider not to be indicative of our ongoing operations; and
  • they do not reflect limitations on our costs related to transferring earnings from our subsidiaries to us.

Because of these limitations, Adjusted Net Trading Income, EBITDA, Adjusted EBITDA, Normalized Adjusted Net Income before income taxes, Normalized provision for income taxes, Normalized Adjusted Net Income and Normalized Adjusted EPS are not intended as alternatives to Net Income as indicators of our operating performance and should not be considered as measures of discretionary cash available to us to invest in the growth of our business or as measures of cash that will be available to us to meet our obligations. We compensate for these limitations by using Adjusted Net Trading Income, EBITDA, Adjusted EBITDA, Normalized Adjusted Net Income before income taxes, Normalized provision for income taxes, Normalized Adjusted Net Income and Normalized Adjusted EPS along with other comparative tools, together with U.S. GAAP measurements, to assist in the evaluation of operating performance. These U.S. GAAP measurements include Net Income, cash flows from operations and cash flow data. See below a reconciliation of each non-GAAP measure to the most directly comparable GAAP measure.

Virtu Financial, Inc. and Subsidiaries
Condensed Consolidated Statements of Comprehensive Income (Unaudited)

    Three Months Ended
December 31,
  Year Ended
December 31,
(in thousands, except share and per share data)     2021       2020       2021       2020  
                 
Revenues:                
Trading income, net   $ 513,354     $ 505,492     $ 2,105,194     $ 2,493,248  
Interest and dividends income     49,138       15,331       75,384       62,119  
Commissions, net and technology services     143,802       148,176       614,489       600,510  
Other, net     (691 )     7,697       16,418       83,454  
Total revenues     705,603       676,696       2,811,485       3,239,331  
                 
Operating Expenses:                
Brokerage, exchange, clearance fees and payments for order flow, net     156,549       185,074       745,434       758,843  
Communication and data processing     52,164       51,414       211,988       213,750  
Employee compensation and payroll taxes     103,110       66,445       376,282       393,536  
Interest and dividends expense     64,119       27,993       139,704       125,649  
Operations and administrative     22,513       21,079       88,149       94,558  
Depreciation and amortization     18,052       16,013       67,816       66,741  
Amortization of purchased intangibles and acquired capitalized software     16,580       18,077       69,668       74,254  
Termination of office leases     23,011       9,265       28,138       9,608  
Debt issue cost related to debt refinancing, prepayment and commitment fees     1,609       1,597       6,590       28,879  
Transaction advisory fees and expenses     694       205       843       2,941  
Financing interest expense on long-term borrowings     20,185       19,971       79,969       87,735  
Total operating expenses     478,586       417,133       1,814,581       1,856,494  
                 
Income before income taxes and noncontrolling interest     227,017       259,563       996,904       1,382,837  
Provision for income taxes     41,059       61,880       169,670       261,924  
Net income   $ 185,958     $ 197,683     $ 827,234     $ 1,120,913  
                 
Noncontrolling interest     (81,902 )     (85,405 )     (350,356 )     (471,716 )
                 
Net income available for common stockholders   $ 104,056     $ 112,278     $ 476,878     $ 649,197  
                 
Earnings per share:                
Basic   $ 0.90     $ 0.89     $ 3.95     $ 5.19  
Diluted   $ 0.89     $ 0.88     $ 3.91     $ 5.16  
                 
Weighted average common shares outstanding                
Basic     111,971,432       122,775,185       117,339,539       121,692,443  
Diluted     112,639,792       123,500,713       118,423,928       122,332,190  
                 
Comprehensive income:                
Net income   $ 185,958     $ 197,683     $ 827,234     $ 1,120,913  
Other comprehensive income                
Foreign exchange translation adjustment, net of taxes     (1,018 )     11,458       (12,470 )     15,318  
Net change in unrealized cash flow hedges gains (losses), net of taxes     19,596       5,406       37,794       (59,019 )
Comprehensive income   $ 204,536     $ 214,547     $ 852,558     $ 1,077,212  
Less: Comprehensive income attributable to noncontrolling interest     (88,836 )     (92,554 )     (360,389 )     (452,855 )
Comprehensive income available for common stockholders   $ 115,700     $ 121,993     $ 492,169     $ 624,357  

 

Virtu Financial, Inc. and Subsidiaries
Reconciliation to Non-GAAP Operating Data (Unaudited)

The following tables reconcile Condensed Consolidated Statements of Comprehensive Income to arrive at Adjusted Net Trading Income, EBITDA, Adjusted EBITDA, and selected Operating Margins.

    Three Months Ended
December 31,
  Year Ended
December 31,
(in thousands, except percentages)     2021       2020       2021       2020  
                 
Reconciliation of Trading income, net to Adjusted Net Trading Income                
Trading income, net   $ 513,354     $ 505,492     $ 2,105,194     $ 2,493,248  
Commissions, net and technology services     143,802       148,176       614,489       600,510  
Interest and dividends income     49,138       15,331       75,384       62,119  
Brokerage, exchange, clearance fees and payments for order flow, net     (156,549 )     (185,074 )     (745,434 )     (758,843 )
Interest and dividends expense     (64,119 )     (27,993 )     (139,704 )     (125,649 )
Adjusted Net Trading Income   $ 485,626     $ 455,932     $ 1,909,929     $ 2,271,385  
                 
Reconciliation of Net Income to EBITDA and Adjusted EBITDA                
Net income (loss)     185,958       197,683       827,234       1,120,913  
Financing interest expense on long-term borrowings     20,185       19,971       79,969       87,735  
Debt issue cost related to debt refinancing, prepayment and commitment fees     1,609       1,597       6,590       28,879  
Depreciation and amortization     18,052       16,013       67,816       66,741  
Amortization of purchased intangibles and acquired capitalized software     16,580       18,077       69,668       74,254  
Provision for income taxes     41,059       61,880       169,670       261,924  
EBITDA   $ 283,443     $ 315,221     $ 1,220,947     $ 1,640,446  
Severance     1,535       3,094       6,112       10,286  
Transaction advisory fees and expenses     694       205       843       2,941  
Termination of office leases     23,011       9,265       28,138       9,608  
Gain on sale of MATCHNow                       (58,652 )
Other     2,270       (6,257 )     (10,558 )     (16,418 )
Share based compensation     17,491       22,328       55,751       59,838  
Adjusted EBITDA   $ 328,444     $ 343,856     $ 1,301,233     $ 1,648,049  
                 
Selected Operating Margins                
Net Income Margin (1)     38.3 %     43.4 %     43.3 %     49.3 %
EBITDA Margin (2)     58.4 %     69.1 %     63.9 %     72.2 %
Adjusted EBITDA Margin (3)     67.6 %     75.4 %     68.1 %     72.6 %
                 
1 Calculated by dividing net income by Adjusted Net Trading Income.                
2 Calculated by dividing EBITDA by Adjusted Net Trading Income.                
3 Calculated by dividing Adjusted EBITDA by Adjusted Net Trading Income.                

 

Virtu Financial, Inc. and Subsidiaries
Reconciliation to Non-GAAP Operating Data (Unaudited)
(Continued)

The following tables reconcile Condensed Consolidated Statements of Comprehensive Income to arrive at Normalized Adjusted Net Income before income taxes, Normalized provision for income taxes, Normalized Adjusted Net Income and Normalized Adjusted EPS.

    Three Months Ended
December 31,
  Year Ended
December 31,
(in thousands, except share and per share data)     2021     2020       2021       2020  
                 
Reconciliation of Net Income to Normalized Adjusted Net Income                
Net income   $ 185,958   $ 197,683     $ 827,234     $ 1,120,913  
Provision for income taxes     41,059     61,880       169,670       261,924  
Income before income taxes and noncontrolling interest   $ 227,017   $ 259,563     $ 996,904     $ 1,382,837  
Amortization of purchased intangibles and acquired capitalized software     16,580     18,077       69,668       74,254  
Debt issue cost related to debt refinancing, prepayment and commitment fees     1,609     1,597       6,590       28,879  
Severance     1,535     3,094       6,112       10,286  
Transaction advisory fees and expenses     694     205       843       2,941  
Termination of office leases     23,011     9,265       28,138       9,608  
Gain on sale of MATCHNow                     (58,652 )
Other     2,270     (6,257 )     (10,558 )     (16,418 )
Share based compensation     17,491     22,328       55,751       59,838  
Normalized Adjusted Net Income before income taxes   $ 290,207   $ 307,872     $ 1,153,448     $ 1,493,573  
Normalized provision for income taxes (1)     69,649     73,889       276,827       358,458  
Normalized Adjusted Net Income   $ 220,558   $ 233,983     $ 876,621     $ 1,135,115  
                 
Weighted Average Adjusted shares outstanding (2)     186,110,956     197,503,595       191,958,870       196,929,673  
                 
Normalized Adjusted EPS   $ 1.19   $ 1.18     $ 4.57     $ 5.76  
                 
(1) Reflects U.S. federal, state, and local income tax rate applicable to corporations of approximately 24% for all periods presented.
(2) Assumes that (1) holders of all vested and unvested non-vesting Virtu Financial Units (together with corresponding shares of the Company's Class C common stock, par value $0.00001 per share (the “Class C Common Stock”)) have exercised their right to exchange such Virtu Financial Units for shares of Class A Common Stock on a one-for-one basis, (2) holders of all Virtu Financial Units (together with corresponding shares of the Company's Class D common stock, par value $0.00001 per share (the “Class D Common Stock”)) have exercised their right to exchange such Virtu Financial Units for shares of the Company's Class B common stock, par value $0.00001 per share (the “Class B Common Stock”) on a one-for-one basis, and subsequently exercised their right to convert the shares of Class B Common Stock into shares of Class A Common Stock on a one-for-one basis. Includes additional shares from dilutive impact of options, restricted stock units and restricted stock awards outstanding under the Amended and Restated 2015 Management Incentive Plan and the Amended and Restated ITG 2007 Equity Plan during the three months and full years ended December 31, 2021 and 2020 as well as warrants issued in connection with the Founder Member Loan during the three months and full year ended December 31, 2020.

 

Virtu Financial, Inc. and Subsidiaries
Condensed Consolidated Statements of Financial Condition (Unaudited)

(in thousands, except share data)   December 31,
2021
  December 31,
2020
         
Assets        
Cash and cash equivalents   $ 1,071,463   $ 889,559  
Cash and securities segregated under regulations and other     49,490     117,446  
Securities borrowed     1,349,322     1,425,016  
Securities purchased under agreements to resell     119,453     22,866  
Receivables from broker-dealers and clearing organizations     1,026,807     1,684,006  
Receivables from customers     146,476     214,478  
Trading assets, at fair value     4,256,955     3,115,731  
Property, equipment and capitalized software, net     89,595     113,590  
Operating lease right-of-use assets     225,328     268,864  
Goodwill     1,148,926     1,148,926  
Intangibles (net of accumulated amortization)     386,332     454,499  
Deferred taxes     158,518     193,070  
Other assets     291,306     317,747  
Total assets     10,319,971     9,965,798  
         
Liabilities and equity        
Liabilities        
Short-term borrowings, net     61,510     64,686  
Securities loaned     1,142,048     948,256  
Securities sold under agreements to repurchase     514,325     461,235  
Payables to broker-dealers and clearing organizations     571,526     876,446  
Payables to customers     54,999     118,826  
Trading liabilities, at fair value     3,510,779     2,923,708  
Tax receivable agreement obligations     259,282     271,165  
Accounts payable and accrued expenses and other liabilities     457,942     491,818  
Deferred tax liabilities     65      
Operating lease liabilities     278,745     315,340  
Long-term borrowings, net     1,605,132     1,639,280  
Total liabilities     8,456,353     8,110,760  
         
Total equity     1,863,618     1,855,038  
         
Total liabilities and equity   $ 10,319,971   $ 9,965,798  
         
    As of December 31, 2021
Ownership of Virtu Financial LLC Interests:   Interests   %
Virtu Financial, Inc. - Class A Common Stock and Restricted Stock Units     116,612,326     62.7 %
Non-controlling Interests (Virtu Financial LLC)     69,450,805     37.3 %
Total Virtu Financial LLC Interests     186,063,131     100.0 %

 

About Virtu Financial, Inc.

Virtu is a leading financial services firm that leverages cutting-edge technology to provide execution services and data, analytics and connectivity products to its clients and deliver liquidity to the global markets. Leveraging its global market making expertise and infrastructure, Virtu provides a robust product suite including offerings in execution, liquidity sourcing, analytics and broker-neutral, multi-dealer platforms in workflow technology. Virtu’s product offerings allow clients to trade on hundreds of venues across 50+ countries and in multiple asset classes, including global equities, ETFs, foreign exchange, futures, fixed income and myriad other commodities. In addition, Virtu’s integrated, multi-asset analytics platform provides a range of pre and post-trade services, data products and compliance tools that clients rely upon to invest, trade and manage risk across global markets.

Cautionary Note Regarding Forward-Looking Statements

This press release may contain “forward-looking statements” made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Statements regarding Virtu Financial, Inc.’s (“Virtu’s”, the “Company’s” or “our”) business that are not historical facts are forward-looking statements. Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by which, such performance or results will be achieved. The Company assumes no obligation to update forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information, and if the Company does update one or more forward-looking statements, no inference should be drawn that the Company will make additional updates with respect thereto or with respect to other forward-looking statements. Forward-looking statements are based on information available at the time and/or management’s good faith belief with respect to future events, and is subject to risks and uncertainties, some or all of which are not predictable or within Virtu’s control, that could cause actual performance or results to differ materially from those expressed in the statements. Those risks and uncertainties include, without limitation: risks relating to the COVID-19 pandemic, including the possible effects of the economic conditions worldwide resulting from the COVID-19 pandemic and governmental and other responses thereto; fluctuations in trading volume and volatilities in the markets in which we operate; the ability of our trading counterparties and various clearing houses to perform their obligations to us; the performance and reliability of our customized trading platform; the risk of material trading losses from our market making activities; swings in valuations in securities or other instruments in which we hold positions; increasing competition and consolidation in our industry; the risk that cash flow from our operations and other available sources of liquidity will not be sufficient to fund our various ongoing obligations, including operating expenses, short-term funding requirements, margin requirements, capital expenditures, debt service and dividend payments; regulatory and legal uncertainties and potential changes associated with our industry, particularly in light of increased attention from media, regulators and lawmakers to market structure and related issues including but not limited to the retail trading environment, wholesale market making and off exchange trading more generally and payment for order flow arrangements; potential adverse results from legal or regulatory proceedings; our ability to remain technologically competitive and to ensure that the technology we utilize is not vulnerable to security risks, hacking and cyber-attacks; risks associated with third party software and technology infrastructure. For a discussion of the risks and uncertainties which could cause actual results to differ from those contained in forward-looking statements, see Virtu’s Securities and Exchange Commission filings, including but not limited to Virtu’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed with the SEC.

CONTACT

        Investor & Media Relations
        Andrew Smith
        investor_relations@virtu.com


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Source: Virtu Financial, LLC

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