Marketaxess Holdings, Inc. · NASDAQ:MKTX
Marketaxess — Q3 2017 Earnings Presentation
12 slides from Marketaxess's earnings presentation, Oct 25, 2017
Slide 1: 3Q17 Conference Call & Webcast
3Q17 CONFERENCE CALL & WEBCAST October 25, 2017
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
Slide 3: 3Q17 Summary
3Q17 Summary1 Earnings Business Highlights Revenues of $96.7 million, up 7.1% Total trading volume of $346.8 billion, up 7.6% Estimated U.S. high-grade market share of 17.2%, up from Expenses of $49.5 million, up 12.7% 16.0%; high-grade trading volume of $200.8 billion, up 12.5% Pre-tax in
Slide 4: Market Conditions
Market Conditions U.S. High-Grade & High-Yield TRACE1 Liquid U.S. Corporate Index (LUCI) Q3 YoY Growth HG TRACE HY TRACE Benchmark Spread 3 Month Rolling Spread Volatility 2,250 180 2.7% LUCI 3 Month Rolling Spread Volatility HG TRACE: 5% Total HG and HY TRACE ($ billions) 2,000 LUCI Benchmark Sprea
Slide 5: Open Trading Growth Highlights
Open Trading™ Open Trading Growth Highlights 180,000 Trade Volume Trade Count 70 $884 million average daily volume, up 29% from 3Q16 160,000 60 27% Approximately 155,000 total Open Trading transactions completed Trade Volume ($ in billion) Trade Count ( # of trades) 140,000 Q3 YoY 50 in 3Q17, up
Slide 6: International Progress
International Progress International Client Volumes Emerging Market Volume Region and Client Count Emerging Markets Eurobonds U.S. Credit Local Markets External Markets 140 90 Q3 YoY Growth: Emerging Market Volume ($ billions) 80 120 Emerging Markets 38% Eurobond -6% 70 $22 100 $20 U.S. Credit 57% 6
Slide 7: Quarterly Volume and U.S. High-Grade Market Share
Quarterly Volume Global U.S. High-Grade U.S. High-Grade Volume Market Share Market Share1 400 250 18% 8% 13% U.S. High-Grade Volume ($ billions) 350 Q3 YoY Q3 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% 3Q15 4Q15 1Q16 2Q16 3Q16 4Q
Slide 8: Earnings Performance
Earnings Performance (In thousands, except per share data) ∆ 3Q17 vs. 3Q17 2Q17 3Q16 3Q16 Revenues Commissions $ 86,270 $ 87,015 $ 81,456 5.9% Information and Post-trade Services 8,372 8,272 7,322 14.3% Investment and Other Income 2,059 2,027 1,493 37.9% Total Revenues 96,701 97,314 90,271 7.1% Expe
Slide 9: Commission Revenue Detail
Commission Revenue Detail %Δ ($ in thousands) 3Q17 vs. 3Q17 2Q17 3Q16 3Q16 Commissions Transaction Fees U.S. High-Grade $ 34,020 $ 32,868 $ 33,765 0.8% 1 Other Credit 31,381 37,145 30,181 4.0% 2 Liquid Products 545 570 798 (31.7%) Total Transaction Fees 65,946 70,583 64,744 1.9% Distribution Fees U.
Slide 10: Expense Detail
Expense Detail ($ in thousands) %∆ 3Q17 vs. 3Q17 2Q17 3Q16 3Q16 Expenses Employee Comp. and Benefits $ 25,595 $ 25,421 $ 23,914 7.0% Depreciation and Amortization 4,583 4,790 4,325 6.0% Technology and Communications 5,035 4,822 4,245 18.6% Professional and Consulting 5,547 4,086 4,342 27.8% Occupanc
Slide 11: Balance Sheet Data
Balance Sheet Data ($ in thousands) % Δ vs. 9/30/2017 12/31/2016 12/31/2016 Assets Cash and Cash Equivalents $ 138,992 $ 168,243 (17.4%) Investments 237,221 194,404 22.0% Accounts Receivable, net 63,027 50,668 24.4% All Other Assets 123,107 114,727 7.3% Total Assets $ 562,347 $ 528,042 6.5% Liabilit
Slide 12: Summary
Summary Challenging quarter for fixed income trading in low volatility climate Continued strong growth in our active client network Emerging markets momentum continues Record Open Trading client participation Regulatory changes, including MiFID II, likely to be a catalyst for future growth