Stonex Group Inc. · NASDAQ:SNEX
Stonex — INTL FCStone — Investor Presentation (2019)
26 slides from Stonex's investor presentation, 2019
Slide 1: Investor Presentation 2nd Quarter 2019
INVESTOR PRESENTATION 2nd Quarter 2019 NASDAQ: INTL
Slide 2: Disclaimer
Disclaimer This presentation contains “forward-looking statements” within the meaning of "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are identi
Slide 3: Market Capitalization and Valuation Metrics
10yr Compound Market Capitalization Growth Rates @ ~$38.76/share* Operating Revenue – ~$740 million 28% BVPS – 8% LTM Operating Revenue - $1,039mm ROE – 15.6% EPS - $4.18 Share Price Valuation Metrics @ Performance ~$38.76/share* 1 yr -9% Operating Revenue 0.7x 5 yr +106% EPS 9.2x 10yr +280% Price/B
Slide 4: Leading independent financial services company connecting over 20,000 clients
Leading independent financial services company that connects over 20,000 clients and over 80,000 retail clients with over 40 public exchanges and hundreds of liquidity sources globally. 4
Slide 5: Efficient and transparent execution, intelligence, settlement and clearing
We offer a unique capability to provide efficient and transparent execution (high touch or electronic), market intelligence as well as post trade settlement and clearing in nearly all markets and asset classes. 5
Slide 6: Monetizing client activity through commissions, spreads and interest
We monetize the client activity across our platform by earning commissions and spreads on trade execution and in addition earn interest on roughly $3 billion of balances which our clients custody with us. 6
Slide 7: INTL FCStone Overview
INTL FCStone Overview Company Overview Key Stats (1) INTL FCStone is a diversified mid-sized financial services company that Financial Metrics serves as an intermediary between our customers and the global financial Operating Revenue: $1,038.8mm markets. Net Income: $81.3mm(2) We execute and
Slide 8: Business Segment Overview
Business Segment Overview CLEARING AND COMMERCIAL GLOBAL PHYSICAL SECURITIES EXECUTION HEDGING PAYMENTS SERVICES COMMODITIES Net Operating $227 (37%) $103 (17%) $108 (17%) $132 (21%) $49 (8%) Revenue ($mm)* High-touch, value- Network covers over Market maker for Competitive clearing and Fu
Slide 9: Growing Global Footprint
Growing Global Footprint SERVING MORE THAN 20,000 CUSTOMERS GLOBALLY WITH 1,700 PROFESSIONALS LOCATED IN 13 COUNTRIES ON 5 CONTINENTS 9
Slide 10: Our Clients
Our Clients High touch advisory approach Commercial Entities, Charities & NGOs High margin, low volume Seeking to mitigate risk or enhance margins in production processes Large runway but slow to scale Charities & NGOs demand best execution on their foreign payments Expensive delivery
Slide 11: Interest Rate Sensitivity
Interest Rate Sensitivity Average Invested Customer Balances & Interest Earnings by Quarter 3,500 $17.9mm 18.0 1.76% 2.00% $15.4mm 2.21% 2.36% Yield: 1.45% $100mm $16.6mm $101mm $13.8mm 16.0 3,000 $110mm $95mm $750mm $768mm $90mm 14.0 $803mm 2,500 $819mm $10.8mm $764mm 12.0 2,000 USDmm 10.0 USDmm 1,
Slide 12: Long-Term Performance
Long-Term Performance Operating Revenue ($mm) Net Income From Continuing Operations ($mm) 1200 90 $81(4) $1,039 $976 80 1000 70 $784 $56 $56(2)(3) 800 60 $55 $671 $624 50 600 $491 40 400 30 $20 20 200 $6(1) 10 0 0 2014 2015 2016 2017 2018 LTM 2014 2015 2016 2017 2018 LTM Stockholder’s Equity ($mm) A
Slide 13: Revenue Breakdown
Revenue Breakdown Asia, 2.8% Other foreign, South America, 0.6% 5.0% Europe, 19.6% United States, 72.1% (1) “Physical Trading” includes Sales of physical commodities, Cost of sales of physical commodities and associated Trading gains, net in our Physical Commodities segment. (2) Operating Revenue br
Slide 14: INTL Benefits from Macro Trends
INTL Benefits from Macro Trends Industry Challenge Approved regulatory status as REGULATION broker-dealer, swap dealer, FCM Difficult to offer broad solutions due to increased complexity Fully compliant in multiple Significantly increased cost burden jurisdictions Natural home for mid-sized
Slide 15: INTL Investment Rationale
INTL Investment Rationale Volatility. Drives volumes and widens trading spreads Interest Rates. Our ~$3bn float @ +100bps = $13mm+ Net Income Operating Leverage. Scalable platform with operational leverage Diversified Earnings Stream across product & geography Consolidating Market in the Mid-Tier Sp
Slide 16: Our Business Segments
INTL FCStone’ Our Business Segments
Slide 17: Commercial Hedging
Commercial Hedging Transactional Revenue Breakdown (LTM) Delivering a high touch, value added service to commercial customers seeking to manage risk 8% Long term quality relationships with customers Comprehensive platform allows access to advice, exchange listed products, OTC and structured pr
Slide 18: Global Payments
Global Payments Leading capability to offer a global payments solution to customers in over 140 currencies and markets Value-added execution efficiencies - strong ties to local correspondent banks affords access to best rates Significant investment in technology to reduce costs and create scal
Slide 19: Securities
Securities • We are the #1 ranking market maker by dollar value for E international securities traded over-the-counter, three years Net Operating Revenue Breakdown (LTM) q running u • We rank #1 by dollar value in over 2,600 securities 1%6% i • We make markets in over 5,000 securities including over
Slide 20: Clearing and Execution
Clearing and Execution Competitive and efficient clearing and execution of exchange- Net Operating Revenue Breakdown (LTM) traded futures and options for traders and institutions Provide services for institutional and professional trader market segments 22% Offer facilities management and outs
Slide 21: Physical Commodities
Physical Commodities Full range of trading and hedging capabilities, including Net Operating Revenue Breakdown (LTM) OTC products, to select producers, consumers, and investors Act as principal, commit own capital to buy/sell on spot and forward basis Provide commodity financing and facilitati
Slide 22: Appendix
INTL FCStone’ Appendix
Slide 23: Balance Sheet Summary
Balance Sheet Summary ($ in millions) 9/30/2018 3/31/2019 Cash and cash equivalents 342.3 274.4 Conservatively capitalized with minimal Cash, securities and other assets segregated under federal and debt other regulations 1 1,408.7 959.0 0.78x Debt/Equity as of 3/31/19 Securities purchased under
Slide 24: Income Statement Summary
Income Statement Summary ($ in millions) Three Months Ended March 31, Six Months Ended March 31, 2019 2018 % Change 2019 2018 % Change Revenues: Sales of physical commodities $ 6,929.5 $ 6,255.8 11 % $ 13,225.3 $ 13,970.2 (5)% Trading gains, net 110.3 98.5 12 203.1 175.6 16 Commission and clearing f
Slide 25: Company Timeline
Company Timeline Three Predecessor Firms Combine to Form a Global Leader Acquisition of CoinInvest GmbH * Opportunistic M&A has positioned INTL for future growth * In September 2016 agreement reached to acquire the London-based EMEA oil brokerage business of ICAP p.l.c. (1) Formerly known as Miller
Slide 26: Transaction Volume Summary
Transaction Volume Summary Volumes and Other Data: 3/31/17 6/30/17 9/30/17 12/31/17 3/31/18 6/30/18 9/30/18 12/31/18 3/31/19 Exchange-traded futures & options 25,460.0 24,190.4 25,385.4 25,862.1 36,696.0 35,632.6 31,295.6 37,527.1 29,060.3 (contracts, 000's) OTC (contracts, 000's) 350.8 382.8 374.6