Marketaxess Holdings, Inc. · NASDAQ:MKTX

Marketaxess — Q2 2017 Earnings Presentation

13 slides from Marketaxess's earnings presentation, Jul 26, 2017

  1. Slide 1: 2Q17 Conference Call & Webcast

    2Q17 CONFERENCE CALL & WEBCAST July 26, 2017

  2. Slide 2: Forward Looking Statements

    Forward Looking Statements This presentation may contain forward-looking statements, including statements about the outlook and prospects for Company and industry growth, as well as statements about the Company’s future financial and operating performance. These and other statements that relate to f

  3. Slide 3: 2Q17 Summary

    2Q17 Summary1 Earnings Business Highlights  Total trading volume of $361.5 billion, up 6.9%  Revenues of $97.3 million, up 0.7%  International client trading volume of $92.2 billion, up 23.8%  Expenses of $47.7 million, up 3.6%  Estimated U.S. high-grade market share of 17.0%, up from 16.1%  P

  4. Slide 4: Market Conditions

    Market Conditions U.S. High-Grade & High-Yield TRACE1 Liquid U.S. Corporate Index (LUCI) 2Q YoY Growth HG TRACE HY TRACE 2,250 Benchmark Spread 3 Month Rolling Spread Volatility HG TRACE: 1% 180 2.7% LUCI 3 Month Rolling Spread Volatility Total HG and HY TRACE ($ billions) 2,000 HY TRACE: -12% LUCI

  5. Slide 5: Global Regulatory Landscape

    Global Regulatory Landscape MarketAxess is well-aligned with regulatory objectives as global regulatory reform continues to provide a potential catalyst for fixed income electronic trading on regulated venues. MiFID II Implementation U.S. Regulatory and Tax Landscape  Our MiFID II implementation pr

  6. Slide 6: Open Trading Growth Highlights

    Open Trading™ Open Trading Growth Highlights 180,000 Trade Volume Trade Count 70  $907 million average daily volume, up 42% from 2Q16 160,000 60 40%  Approximately 157,000 total Open Trading transactions completed Trade Volume ($ in billion) Trade Count ( # of trades) 140,000 Q2 YoY 50 in 2Q17, up

  7. Slide 7: International Progress

    International Progress International Client Volumes Emerging Market Volume Region and Client Count Emerging Markets Eurobonds U.S. Credit Local Markets External Markets Active Firms # of Active Clients Trading Emerging Markets 120 90 900 Q2 YoY Growth: Emerging Market Volume ($ billions) 80 850 100

  8. Slide 8: Quarterly Volume and Active Clients

    Quarterly Volume and Active Clients Global U.S. High-Grade U.S. High-Grade Volume Market Share Market Share1 400 250 18% 7% 8% U.S. High-Grade Volume ($ billions) 350 Q2 YoY Q2 YoY 17% 300 Growth 200 Growth 16% Market Share 250 ($ billions) 150 15% 200 100 14% 150 13% 100 50 50 12% 0 0 11% 2Q15 3Q15

  9. Slide 9: Earnings Performance

    Earnings Performance (In thousands, except per share data) ∆ 2Q17 vs. 2Q17 1Q17 2Q16 2Q16 Revenues Commissions $ 87,015 $ 94,022 $ 86,239 0.9% Information and Post-trade Services 8,272 7,816 8,586 (3.7%) Investment and Other Income 2,027 2,053 1,814 11.7% Total Revenues 97,314 103,891 96,639 0.7% Ex

  10. Slide 10: Commission Revenue Detail

    Commission Revenue Detail %Δ ($ in thousands) 2Q17 vs. 2Q17 1Q17 2Q16 2Q16 Commissions Transaction Fees U.S. High-Grade $ 32,868 $ 35,523 $ 35,771 (8.1%) 1 Other Credit 37,145 41,695 33,826 9.8% 2 Liquid Products 570 630 678 (15.9%) Total Transaction Fees 70,583 77,848 70,275 0.4% Distribution Fees

  11. Slide 11: Expense Detail

    Expense Detail ($ in thousands) %∆ 2Q17 vs. 2Q17 1Q17 2Q16 2Q16 Expenses Employee Comp. and Benefits $ 25,421 $ 27,401 $ 25,815 (1.5%) Depreciation and Amortization 4,790 4,693 4,540 5.5% Technology and Communications 4,822 4,585 4,277 12.7% Professional and Consulting 4,086 4,279 4,245 (3.7%) Occup

  12. Slide 12: Balance Sheet Data

    Balance Sheet Data ($ in thousands) % Δ vs. 6/30/2017 12/31/2016 12/31/2016 Assets Cash and Cash Equivalents $ 128,143 $ 168,243 (23.8%) Investments 237,361 194,404 22.1% Accounts Receivable, net 55,215 50,668 9.0% All Other Assets 126,322 114,727 10.1% Total Assets $ 547,041 $ 528,042 3.6% Liabilit

  13. Slide 13: Summary

    Summary  Challenging quarter for fixed income trading in low volatility climate  Continued strong client participation, with growing momentum from international clients  Emerging market product area continues to demonstrate strong growth  Record Open Trading volume as a percent of total trade vo

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