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GAIN Announces Final Results of Tender Offer

BEDMINSTER, N.J., Nov. 9, 2018 /PRNewswire/ -- GAIN Capital Holdings, Inc. (NYSE: GCAP) announced today the final results of its "modified Dutch auction" tender offer, which expired at 5:00 P.M., New York City time, on November 6, 2018.

GAIN Capital Holdings, Inc. Logo. (PRNewsFoto/GAIN Capital Holdings, Inc.)

GAIN has accepted for purchase 6,377,551 shares of its common stock at a price of $7.84 per share (reflecting a proration factor of approximately 0.95664), for an aggregate cost of approximately $50 million, excluding fees and expenses relating to the tender offer. These shares represent approximately 14 percent of the shares outstanding.

Jefferies LLC acted as dealer manager for the tender offer. Stockholders who have questions or would like additional information about the tender offer may contact the information agent for the tender offer, D.F. King & Co., Inc. at (800) 735-3591 or by email at gcap@dfking.com.

About GAIN

GAIN Capital Holdings, Inc. provides innovative trading technology and execution services to retail and institutional investors worldwide, with multiple access points to OTC markets and global exchanges across a wide range of asset classes, including foreign exchange, commodities, and global equities. GAIN Capital is headquartered in Bedminster, New Jersey, with a global presence across North America, Europe and the Asia Pacific regions. For further company information, visit www.gaincapital.com.

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SOURCE GAIN Capital Holdings, Inc.

Investor Relations Contact: Lauren Tarola, Edelman for GAIN Capital, Phone: 1-908-731-0737, Email: ir@gaincapital.com ; Media Contact: Nicole Briguet, Edelman for GAIN Capital, Phone: 1-212-704-8164, Email: pr@gaincapital.com

GAIN Capital Announces Monthly Metrics for October 2018

BEDMINSTER, N.J., Nov. 9, 2018 /PRNewswire/ -- GAIN Capital Holdings, Inc. (NYSE: GCAP) ("GAIN" or "the Company") today reported certain operating metrics for the month of October 2018.


Oct-18

Sept-18

Oct-17

Sequential
Change

Year-over-
year change

Retail Segment






OTC Trading Volume(1)

$

231.2


$

149.6


$

192.5


54.5

%

20.1

%

OTC Average Daily Volume

$

10.1


$

7.5


$

8.8


34.7

%

14.8

%

12 Month Trailing Active OTC Accounts(2)

127,054


129,182


133,599


(1.6)

%

(4.9)

%

3 Month Trailing Active OTC Accounts(2)

70,225


71,597


81,363


(1.9)

%

(13.7)

%







Futures Segment






Number of Futures Contracts

814,345


554,687


524,625


46.8

%

55.2

%

Futures Average Daily Contracts

35,406


29,194


23,847


21.3

%

48.5

%

12 Month Trailing Active Futures Accounts(2)

7,806


7,550


7,973


3.4

%

(2.1)

%



All volume figures reported in billions.

1 US dollar equivalent of notional amounts traded.

2 Accounts that executed a transaction during the relevant period.

GAIN Capital Holdings, Inc. Logo. (PRNewsFoto/GAIN Capital Holdings, Inc.)

 

Historical metrics and financial information can be found on the Company's investor relations website http://ir.gaincapital.com.

This operating data is preliminary and subject to revision and should not be taken as an indication of GAIN's financial performance. GAIN undertakes no obligation to publicly update or review previously reported operating data.

About GAIN

GAIN Capital Holdings, Inc. provides innovative trading technology and execution services to retail and institutional investors worldwide, with multiple access points to OTC markets and global exchanges across a wide range of asset classes, including foreign exchange, commodities, and global equities. GAIN Capital is headquartered in Bedminster, New Jersey, with a global presence across North America, Europe and the Asia Pacific regions.  For further company information, visit www.gaincapital.com.

Cision View original content to download multimedia:http://www.prnewswire.com/news-releases/gain-capital-announces-monthly-metrics-for-october-2018-300747341.html

SOURCE GAIN Capital Holdings, Inc.

Investor Relations Contact: Lauren Tarola, Edelman for GAIN Capital, +1 908.731.0737, ir@gaincapital.com; Media Contact, Nicole Briguet, Edelman for GAIN Capital, +1 212-704-8164, pr@gaincapital.com

GAIN Announces Preliminary Results of Tender Offer

BEDMINSTER, N.J., Nov. 7, 2018 /PRNewswire/ -- GAIN Capital Holdings, Inc. (NYSE: GCAP) announced today the preliminary results of its "modified Dutch auction" tender offer, which expired at 5:00 P.M., New York City time, on November 6, 2018. Based on the preliminary count by Broadridge Corporate Issuer Solutions, Inc., the depositary for the tender offer, a number of shares of GAIN's common stock more than sufficient to allow GAIN to successfully complete the purchase of $50 million of its common stock were properly tendered and not properly withdrawn at or below the purchase price of $7.94 per share, including shares that were tendered by notice of guaranteed delivery. 

GAIN Capital Holdings, Inc. Logo. (PRNewsFoto/GAIN Capital Holdings, Inc.)

In accordance with the terms and conditions of the tender offer and based on the preliminary count by the depositary, GAIN expects to accept for payment, at a purchase price of $7.84, approximately 6,377,551 shares (based on proration of shares tendered) of its common stock properly tendered at or below the purchase price and not properly withdrawn before the expiration date, at an aggregate cost of approximately $50 million, excluding fees and expenses relating to the tender offer.

The number of shares to be purchased and the purchase price are preliminary and subject to change. The preliminary information contained in this press release is subject to confirmation by the depositary and is based on the assumption that all shares tendered through notice of guaranteed delivery will be delivered within the two trading day settlement period. The final number of shares to be purchased and the final purchase price will be announced following the expiration of the guaranteed delivery period and completion by the depositary of the confirmation process. Payment for the shares accepted for purchase under the tender offer, and return of all other shares tendered and not purchased, will occur promptly thereafter.

Jefferies LLC acted as dealer manager for the tender offer. Stockholders who have questions or would like additional information about the tender offer may contact the information agent for the tender offer, D.F. King & Co., Inc. at (800) 735-3591 or by email at gcap@dfking.com.  

GAIN also announced today that its Board of Directors has increased the total amount of cash available for purchases of GAIN's common stock under its previously announced share repurchase plan to $50 million in order to increase its flexibility to opportunistically purchase shares of common stock in the open market.

About GAIN

GAIN Capital Holdings, Inc. provides innovative trading technology and execution services to retail and institutional investors worldwide, with multiple access points to OTC markets and global exchanges across a wide range of asset classes, including foreign exchange, commodities, and global equities. GAIN Capital is headquartered in Bedminster, New Jersey, with a global presence across North America, Europe and the Asia Pacific regions. For further company information, visit www.gaincapital.com.

Cautionary Note Regarding Forward-Looking Statements

Any statements contained in this document that are not historical facts are forward-looking statements as defined in the U.S. Private Securities Litigation Reform Act of 1995. Additionally, statements regarding operating results for future years, growth in operating results and the factors contributing to future operating results; the resolution of licensing disputes and the impact and timing thereof; expected market, industry, geographic and organic growth and trends; future serviceable addressable market size and growth; anticipated contributions from and growth in new opportunities; benefits from planned cost reductions; technology and product leadership and trends; GAIN's positioning to benefit from any of the above; potential benefits and upside to GAIN's stockholders related to any of the above; and the regulatory process and regulatory uncertainty are forward-looking statements. Words such as "anticipate," "believe," "estimate," "expect," "forecast," "intend," "may," "plan," "project," "predict," "should," "will" and similar expressions are intended to identify such forward-looking statements. These statements are based on GAIN's current expectations or beliefs, and are subject to uncertainty and changes in circumstances. Actual results may differ materially from those expressed or implied by the statements herein due to changes in economic, business, competitive, technological, strategic and/or regulatory factors, and other factors affecting the operations of GAIN. More detailed information about these factors may be found in GAIN's filings with the SEC, including those discussed in GAIN's most recent Annual Report on Form 10-K and in any subsequent periodic reports on Form 10-Q and Form 8-K, each of which is on file with the SEC and available at the SEC's website at www.sec.gov. SEC filings for GAIN are also available in the Investor Relations section of GAIN website at www.gaincapital.com. GAIN is not obligated to update these forward-looking statements to reflect events or circumstances after the date of this document. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates. 

Cision View original content to download multimedia:http://www.prnewswire.com/news-releases/gain-announces-preliminary-results-of-tender-offer-300745314.html

SOURCE GAIN Capital Holdings, Inc.

Investor Relations Contact: Lauren Tarola, Edelman for GAIN Capital, Phone: 1-908-731-0737, Email: ir@gaincapital.com; Media Contact, Nicole Briguet, Edelman for GAIN Capital, Phone: 1-212-704-8164, Email: pr@gaincapital.com

GAIN Capital Reports Third Quarter 2018 Results

BEDMINSTER, N.J., Oct. 25, 2018 /PRNewswire/ -- GAIN Capital Holdings, Inc. ("GAIN") (NYSE: GCAP), a leading global provider of online trading services, announced financial results for the third quarter of 2018.

GAIN Capital Holdings, Inc. Logo. (PRNewsFoto/GAIN Capital Holdings, Inc.)

Key Financial Results for the Third Quarter (all amounts reflect continuing operations)

  • GAAP net income of $10.0 million, or $0.22 per share, yielding a 10% margin
  • GAAP net revenue of $95.5 million, up 30% year-over-year
  • Adjusted net income of $13.5 million, or $0.30 per share
  • Adjusted EBITDA of $30.5 million, yielding a 32% adjusted EBITDA margin

Operating Highlights

  • New direct accounts increased 28% year-over-year and 23% quarter-over-quarter
  • Futures segment margin doubled to 14% for the first nine months of 2018 as compared to 7% for the nine months ended September 30, 2017
  • Subsequent to quarter end, GAIN commenced a "modified Dutch auction" tender offer to purchase up to $50 million of its shares

A summary of GAIN's financial highlights is included in the chart below (all amounts are from continuing operations).


Three Months Ended September 30,


Nine Months Ended September 30,


2018


2017


2018


2017

Net Income/(Loss)

$

10.0



$

(3.1)



$

28.7



$

(8.0)


Adjusted Net Income/(Loss)(1)

$

13.5



$

1.4



$

31.7



$

(6.6)










Net Revenue

$

95.5



$

73.8



$

278.1



$

215.5


Operating Expenses

(65.0)



(60.9)



(196.8)



(191.7)


Adjusted EBITDA(1)

$

30.5



$

12.9



$

81.3



$

23.8










Diluted GAAP EPS

$

0.22



$

(0.06)



$

0.60



$

(0.14)


Adjusted EPS(1)

$

0.30



$

0.03



$

0.70



$

(0.14)


















Note:  Dollars in millions, except per share amounts and where noted otherwise.  Columns may not add due to rounding.

1See below for reconciliation of non-GAAP financial measures.


Three Months Ended June 30,


Six Months Ended June 30,


2018


2017


2018


2017

Net Income/(Loss)

$

67.1



$

13.9



$

83.2



$

(4.9)


Adjusted Net Income/(Loss)(1)

$

4.4



$

11.3



$

18.4



$

(7.4)










Net Revenue

$

84.2



$

90.6



$

182.5



$

141.8


Operating Expenses

(65.2)



(64.9)



(131.7)



(130.8)


Adjusted EBITDA(1)

$

19.0



$

25.7



$

50.8



$

11.0










Diluted GAAP EPS

$

1.47



$

0.31



$

1.81



$

(0.08)


Adjusted EPS(1)

$

0.10



$

0.24



$

0.40



$

(0.15)


_____________________


Note:  Dollars in millions, except per share amounts and where noted otherwise.  Columns may not add due to rounding.

1 See below for reconciliation of non-GAAP financial measures.

"While overall low market volatility continued to weigh on retail trading volumes during the quarter, our diverse product offering enabled strong revenue growth," commented Glenn Stevens, Chief Executive Officer of GAIN Capital. "Volatility in emerging markets, along with trade tensions, prompted high trading activity in emerging market currencies, as well as certain metals and index products, which helped to generate overall revenue capture of $164 per million for the quarter. In addition, our continued focus on organic, direct account growth and marketing initiatives helped deliver strong operating results in Q3, with new direct accounts up 28% year-over-year. As reiterated through our recently announced $50 million tender offer, we are firmly committed to executing a balanced capital allocation strategy to enhance shareholder value."

Quarterly Operating Metrics


Q3 18


Q3 17


Year-over-
year Change

Retail Segment






OTC Trading Volume (1) (2)

$

506.5



$

644.8



(21.4)

%

OTC Average Daily Volume

$

7.8



$

9.9



(21.2)

%

12 Month Trailing Active OTC Accounts (3)

129,182



133,813



(3.5)

%

3 Month Trailing Active OTC Accounts (3)

71,597



82,275



(13.0)

%







Futures Segment






Number of Futures Contracts

1,622,114



1,518,417



6.8

%

Futures Average Daily Contracts

25,748



24,102



6.8

%

12 Month Trailing Active Futures Accounts (3)

7,550



8,056



(6.3)

%










All volume figures reported in billions.

1 US dollar equivalent of notional amounts traded.

2 For the quarter, indirect volume represented 25% of total retail OTC trading volume.

3 Accounts that executed a transaction during the relevant period.


Q2 18


Q2 17


Year-over-year Change

Retail Segment






OTC Trading Volume (1) (2)

$

679.6



$

646.4



5.1

%

OTC Average Daily Volume

$

10.6



$

9.9



7.1

%

12 Month Trailing Active OTC Accounts (3)

130,018



134,120



(3.1)

%

3 Month Trailing Active OTC Accounts (3)

76,654



83,511



(8.2)

%







Institutional Segment






ECN Volume (1)

$

962.0



$

715.7



34.4

%

ECN Average Daily Volume

$

15.0



$

11.0



36.4

%

Swap Dealer Volume (1)

$

144.7



$

141.5



2.3

%

Swap Dealer Average Daily Volume

$

2.3



$

2.2



4.5

%







Futures Segment






Number of Futures Contracts

2,073,684



1,655,166



25.3

%

Futures Average Daily Contracts

32,401



26,272



23.3

%

12 Month Trailing Active Futures Accounts (3)

7,881



7,885



(0.1)

%

____________________


All volume figures reported in billions.

1 US dollar equivalent of notional amounts traded.

2 For the quarter, indirect volume represented 25% of total retail OTC trading volume.

3 Accounts that executed a transaction during the relevant period.

Capital Return and Dividend

In the third quarter, GAIN:

  • focused on returning capital to shareholders through dividends, which amounted to approximately $2.7 million.
  • repurchased 451,624 shares of stock at an average price of $7.20.
  • returned a total of $5.9 million to shareholders in the form of share repurchases and dividends which brings the year-to-date total return to $19.6 million.
  • focused on returning capital to shareholders through dividends, which amounted to approximately $2.7 million.
  • repurchased 518,816 shares of stock at an average price of $7.85.
  • returned a total of $6.8 million to shareholders in the form of share repurchases and dividends.
  • GAIN's Board of Directors declared a quarterly cash dividend of $0.06 per share of the Company's common stock. The dividend is payable on December 18, 2018 to shareholders of record as of the close of business on December 11, 2018.

    Launch of Tender Offer

    On October 9, 2018, GAIN commenced a "modified Dutch auction" tender offer to purchase up to $50 million of its outstanding shares at the maximum price of $7.94 and minimum price of $7.24. The tender offer is scheduled to close on November 6, 2018, unless otherwise extended by GAIN. The Company believes the tender offer is a prudent use of financial resources given available liquidity, including proceeds from the sale of GTX, and the current market price of its shares.

    Conference Call

    GAIN will host a conference call October 25, 2018 at 4:30 p.m. ET.  Participants may access the live call by dialing +1.888.349.0112 (US Domestic), or +1.412.317.6001 (International). Please let the operator know you would like to join the GAIN Capital call.

    A live audio webcast of the call, as well as a PDF copy of the earnings presentation, will be available on the Investor Relations section of the GAIN Capital website (http://ir.gaincapital.com).

    An audio replay will be made available for one month starting approximately one hour after the call by dialing +1.877.344.7529 from the U.S. or +1.412.317.0088 from abroad, and entering the passcode 10125269#.

    For more corporate information or to sign up for alerts, please visit: http://ir.gaincapital.com.

    About GAIN

    GAIN Capital Holdings, Inc. provides innovative trading technology and execution services to retail and institutional investors worldwide, with multiple access points to OTC markets and global exchanges across a wide range of asset classes, including foreign exchange, commodities, and global equities.  GAIN Capital is headquartered in Bedminster, New Jersey, with a global presence across North America, Europe and the Asia Pacific regions.  For further company information, visit www.gaincapital.com.

     

     

    Condensed Consolidated Statements of Operations

    (unaudited)



    Three Months Ended


    Nine Months Ended


    September 30,


    September 30,


    2018


    2017


    2018


    2017

    REVENUE:








    Retail revenue

    $

    82.9



    $

    62.1



    $

    239.1



    $

    180.2


    Futures revenue

    8.7



    9.0



    30.4



    29.2


    Other (loss)/revenue

    1.2



    1.2



    1.7



    3.1


    Total non-interest revenue

    92.8



    72.4



    271.2



    212.4


    Interest revenue

    3.3



    1.6



    8.2



    3.7


    Interest expense

    0.5



    0.3



    1.3



    0.6


    Total net interest revenue

    2.8



    1.4



    6.9



    3.1


    Net revenue

    $

    95.5



    $

    73.8



    $

    278.1



    $

    215.5


    EXPENSES:








    Employee compensation and benefits

    $

    22.9



    $

    20.8



    $

    69.7



    $

    64.3


    Selling and marketing

    10.2



    6.4



    23.0



    23.2


    Referral fees

    8.1



    12.9



    30.0



    42.7


    Trading expenses

    5.8



    4.7



    17.1



    15.1


    General and administrative

    12.2



    11.2



    38.9



    32.3


    Depreciation and amortization

    4.7



    4.4



    15.4



    12.3


    Purchased intangible amortization

    3.5



    3.5



    10.8



    10.4


    Communications and technology

    5.5



    4.6



    16.4



    14.2


    Bad debt provision

    0.3



    0.1



    1.7



    0.0


    Contingent provision

    5.0



    0.0



    5.0



    0.0


    Impairment of investment

    0.0



    0.0



    (0.1)



    0.0


    Total operating expense

    78.2



    68.8



    227.9



    214.5


    OPERATING PROFIT/(LOSS)

    17.3



    5.0



    50.2



    1.1


    Interest expense on long term borrowings

    3.4



    3.0



    10.1



    8.3


    Loss on extinguishment of debt

    0.0



    4.9



    $

    0



    4.9


    INCOME/(LOSS) BEFORE INCOME TAX
    EXPENSE/(BENEFIT)

    13.9



    (2.9)



    40.1



    (12.2)


    Income tax (benefit)/expense

    4.0



    0.1



    11.4



    (4.3)


    Equity in net loss of affiliate

    0.0



    0.0



    0.0



    (0.1)


    Net income/(loss) from continuing operations

    10.0



    (3.1)



    28.7



    (8.0)


    Income from discontinued operations, including gain on
    sale of $69,439, net of income tax of $3,222

    2.3



    0.7



    67.3



    1.0


    NET INCOME/(LOSS)

    12.3



    (2.4)



    96.0



    (7.0)


    Less income attributable to non-controlling interest

    0.1



    0.2



    0.6



    0.5


    NET INCOME/(LOSS) APPLICABLE TO GAIN
    CAPITAL HOLDINGS, INC.

    $

    12.2



    $

    (2.6)



    $

    95.4



    $

    (7.5)


    Earnings/(loss) per common share:








    Basic earnings/(loss) from continuing operations

    $

    0.22



    $

    (0.06)



    $

    0.61



    $

    (0.14)


    Basic earnings from discontinued operations

    $

    0.05



    $

    0.02



    $

    1.50



    $

    0.02


    Basic

    $

    0.27



    $

    (0.04)



    $

    2.11



    $

    (0.12)


    Diluted earnings/(loss) from continuing operations

    $

    0.22



    $

    (0.06)



    $

    0.60



    $

    (0.14)


    Diluted earnings from discontinued operations

    $

    0.05



    $

    0.02



    $

    1.49



    $

    0.02


    Diluted

    $

    0.27



    $

    (0.04)



    $

    2.09



    $

    (0.12)


    Weighted average common shares outstanding used in
    computing earnings/(loss) per common share:








    Basic

    44,553,903



    46,323,038



    44,787,875



    47,295,843


    Diluted

    44,984,721



    46,323,038



    45,270,797



    47,295,843





    Note: Dollars in millions, except share, per share data and where noted otherwise. Columns may not add due to rounding.

    Condensed Consolidated Statements of Operations
    (unaudited)



    Three Months Ended


    Six Months Ended


    June 30,


    June 30,


    2018


    2017


    2018


    2017

    REVENUE:








    Retail revenue

    $

    72.0



    $

    79.1



    $

    156.2



    $

    118.0


    Futures revenue

    11.1



    9.6



    21.8



    20.1


    Other revenue

    (1.4)



    0.8



    0.5



    1.8


    Total non-interest revenue

    81.8



    89.5



    178.4



    140.0


    Interest revenue

    2.8



    1.3



    4.9



    2.1


    Interest expense

    0.4



    0.1



    0.8



    0.3


    Total net interest revenue

    2.4



    1.1



    4.1



    1.8


    Net revenue

    $

    84.2



    $

    90.6



    $

    182.5



    $

    141.8


    EXPENSES:








    Employee compensation and benefits

    $

    22.5



    $

    23.0



    $

    46.8



    $

    43.5


    Selling and marketing

    6.8



    7.5



    12.7



    16.8


    Referral fees

    10.5



    13.3



    21.9



    29.8


    Trading expenses

    5.5



    4.9



    11.4



    10.3


    General and administrative

    14.2



    11.8



    26.7



    21.1


    Depreciation and amortization

    5.3



    4.1



    10.7



    7.9


    Purchased intangible amortization

    3.6



    3.8



    7.3



    6.9


    Communications and technology

    5.5



    4.5



    10.9



    9.5


    Bad debt provision

    0.3



    (0.2)



    1.4



    (0.1)


    Impairment of investment

    0.0



    0.0



    (0.1)



    0.0


    Total operating expense

    74.2



    72.8



    149.7



    145.7


    OPERATING PROFIT/(LOSS)

    10.0



    17.8



    32.9



    (3.9)


    Interest expense on long term borrowings

    3.4



    2.7



    6.7



    5.4


    INCOME/(LOSS) BEFORE INCOME TAX EXPENSE/(BENEFIT)

    6.6



    15.1



    26.2



    (9.3)


    Income tax expense/(benefit)

    (0.3)



    1.5



    7.4



    (4.4)


    Equity in net loss of affiliate

    0.0



    0.0



    0.0



    (0.1)


    Net income/(loss) from continuing operations

    6.8



    13.5



    18.7



    (4.9)


    Income from discontinued operations, net of tax

    60.6



    0.6



    65.0



    0.2


    NET INCOME/(LOSS)

    67.5



    14.1



    83.7



    (4.7)


    Net income attributable to non-controlling interests

    0.3



    0.2



    0.5



    0.2


    NET INCOME/(LOSS) APPLICABLE TO GAIN CAPITAL HOLDINGS, INC.

    $

    67.1



    $

    13.9



    $

    83.2



    $

    (4.9)


    Earnings/(loss) per common share:








    Basic earnings/(loss) from continuing operations

    $

    0.13



    $

    0.30



    $

    0.39



    $

    (0.09)


    Basic earnings/(loss) from discontinued operations

    $

    1.36



    $

    0.01



    $

    1.45



    $

    0.01


    Basic

    $

    1.49



    $

    0.31



    $

    1.84



    $

    (0.08)


    Diluted earnings/(loss) from continuing operations

    $

    0.13



    $

    0.30



    $

    0.38



    $

    (0.09)


    Diluted earnings/(loss) from discontinued operations

    $

    1.34



    $

    0.01



    $

    1.43



    $

    0.01


    Diluted

    $

    1.47



    $

    0.31



    $

    1.81



    $

    (0.08)


    Weighted average common shares outstanding used in computing earnings/(loss) per common share:








    Basic

    44,797,103



    47,687,214



    44,906,800



    47,790,307


    Diluted

    45,309,002



    47,894,648



    45,415,774



    47,790,307


    __________________


    Note:  Dollars in millions, except share, per share data and where noted otherwise.  Columns may not add due to rounding.

     

     

    Condensed Consolidated Balance Sheet

    (unaudited)



    September 30,


    December 31,


    2018


    2017

    ASSETS:




    Cash and cash equivalents

    $

    362.3



    $

    209.7


    Cash and securities held for customers

    887.3



    978.8


    Receivables from brokers

    57.5



    78.5


    Property and equipment, net of accumulated depreciation

    33.5



    40.7


    Intangible assets, net of accumulated amortization

    36.2



    62.0


    Goodwill

    28.0



    33.0


    Other assets

    37.5



    45.9


              Total assets

    $

    1,442.3



    $

    1,448.6


    LIABILITIES AND SHAREHOLDERS' EQUITY:




    Payables to customers

    $

    887.3



    $

    978.8


    Payables to brokers

    1.8



    2.8


    Accrued compensation & benefits

    11.1



    10.1


    Accrued expenses and other liabilities

    38.0



    33.9


    Income tax payable

    7.5



    0.6


    Convertible senior notes

    136.9



    132.2


              Total liabilities

    $

    1,082.5



    $

    1,158.5


    Redeemable non-controlling interests

    $

    2.5



    $

    4.4


    Shareholders' equity

    357.2



    285.7


              Total liabilities and shareholders' equity

    $

    1,442.3



    $

    1,448.6





    Note: Dollars in millions, except where noted otherwise. Columns may not add due to rounding.

    Condensed Consolidated Balance Sheet
    (unaudited)



    June 30,


    December 31,


    2018


    2017

    ASSETS:




    Cash and cash equivalents

    $

    360.3



    $

    209.7


    Cash and securities held for customers

    920.4



    978.8


    Receivables from brokers

    52.3



    78.5


    Property and equipment - net of accumulated depreciation

    36.5



    40.7


    Intangible assets, net of accumulated amortization

    40.1



    62.0


    Goodwill

    28.2



    33.0


    Other assets

    36.7



    45.9


              Total assets

    $

    1,474.5



    $

    1,448.6


    LIABILITIES AND SHAREHOLDERS' EQUITY:




    Payables to customers

    $

    920.4



    $

    978.8


    Payables to brokers

    3.0



    2.8


    Accrued compensation & benefits

    10.6



    10.1


    Accrued expenses and other liabilities

    39.7



    33.9


    Income tax payable

    10.2



    0.6


    Convertible senior notes

    135.3



    132.2


              Total liabilities

    $

    1,119.2



    $

    1,158.5


    Redeemable non-controlling interests

    $

    2.6



    $

    4.4


    Shareholders' equity

    352.8



    285.7


              Total liabilities and shareholders' equity

    $

    1,474.5



    $

    1,448.6


    _________________________


    Note:  Dollars in millions, except where noted otherwise.  Columns may not add due to rounding.

     

     

    Income Statement of Discontinued Operations



    Three Months Ended
    September 30,


    Nine Months Ended
    September 30,


    2018


    2017


    2018


    2017

    REVENUE:








    Institutional revenue

    $

    0.0



    $

    7.5



    $

    16.4



    $

    23.3


    Total non-interest revenue

    0.0



    7.5



    16.4



    23.3


    Interest revenue

    0.0



    0.0



    0.1



    0.1


    Total net interest revenue

    0.0



    0.0



    0.1



    0.1


    Net revenue

    $

    0.0



    $

    7.6



    $

    16.5



    $

    23.4


    EXPENSES:








    Employee compensation and benefits

    $

    0.1



    $

    3.0



    $

    6.0



    $

    10.0


    Trading expenses

    0.0



    2.4



    5.4



    7.3


    Other expenses

    0.0



    1.1



    4.0



    4.3


    Total operating expense

    0.1



    6.5



    15.4



    21.6


    OPERATING PROFIT

    (0.1)



    1.0



    1.1



    1.8


    Gain on sale of discontinued operations

    (0.1)



    0.0



    69.4



    0.0


    INCOME BEFORE INCOME TAX EXPENSE/(BENEFIT)

    (0.3)



    1.0



    70.6



    1.8


    Income tax expense/(benefit)

    (2.6)



    0.3



    3.2



    0.8


    NET INCOME FROM DISCONTINUED OPERATIONS

    $

    2.3



    $

    0.7



    $

    67.3



    $

    1.0





    Note:  Dollars in millions, except where noted otherwise.  Columns may not add due to rounding.

    Income Statement of Discontinued Operations



    Three Months Ended June 30,


    Six Months Ended June 30,


    2018


    2017


    2018


    2017

    REVENUE:








    Institutional revenue

    7.9



    7.4



    16.4



    15.8


    Total non-interest revenue

    7.9



    7.4



    16.4



    15.8


    Interest revenue

    0.1



    0.0



    0.1



    0.0


    Total net interest revenue

    0.1



    0.0



    0.1



    0.0


    Net revenue

    $

    8.0



    $

    7.5



    $

    16.5



    $

    15.9


    EXPENSES:








    Employee compensation and benefits

    $

    2.5



    $

    3.3



    $

    5.9



    $

    7.0


    Selling and marketing

    0.0



    0.0



    0.1



    0.0


    Referral fees

    0.5



    0.0



    1.0



    0.0


    Trading expenses

    2.8



    2.3



    5.4



    4.9


    General and administrative

    0.5



    0.9



    1.1



    1.4


    Depreciation and amortization

    0.1



    0.2



    0.4



    0.4


    Purchased intangible amortization

    0.4



    0.5



    0.9



    1.1


    Communications and technology

    0.1



    0.1



    0.3



    0.2


    Restructuring expenses

    0.2



    0.0



    0.2



    0.0


    Total operating expense

    7.1



    7.4



    15.2



    15.1


    OPERATING PROFIT/(LOSS)

    0.9



    0.0



    1.2



    0.8


    Gain on sale of discontinued operations

    69.6



    0.0



    69.6



    0.0


    INCOME/(LOSS) BEFORE INCOME TAX EXPENSE/(BENEFIT)

    70.4



    0.0



    70.8



    0.8


    Income tax expense/(benefit)

    9.8



    (0.5)



    5.8



    0.5


    NET INCOME/(LOSS) FROM DISCONTINUED OPERATIONS

    60.6



    0.6



    65.0



    0.2


    _________________________


    Note:  Dollars in millions, except where noted otherwise.  Columns may not add due to rounding.

     

    Reconciliation of GAAP Net Income to Adjusted Net Income, Adjusted EPS and Adjusted Income Tax

    Adjusted net income/(loss) is a non-GAAP financial measure and represents our net income/(loss) excluding restructuring, acquisition and integration related expenses, debt extinguishment and contingent reserve.  Adjusted EPS is calculated using adjusted net income/(loss).  Adjusted income tax (expense)/benefit represents our tax rate excluding quarterly tax rate adjustments, the impact of return to provision adjustments, uncertain tax positions, and the tax effect of the items excluded in the adjusted net income/(loss).  These non-GAAP financial measures have certain limitations, including that they do not have standardized meanings and, therefore, our definitions may be different from similar non-GAAP financial measures used by other companies and/or analysts. Thus, it may be more difficult to compare our financial performance to that of other companies. We believe our reporting of these measures assists investors in evaluating our operating performance. However, because they are not a measure of financial performance or income tax expense calculated in accordance with GAAP, such measures should be considered in addition to, but not as a substitute for, other measures reported in accordance with GAAP.

     

    Net Income/(Loss) to Adjusted Net Income/(Loss) and Adjusted EPS

    (unaudited)



    Three Months Ended


    Nine Months Ended


    September 30,


    September 30,


    2018


    2017


    2018


    2017

    Net income/(loss) from continuing operations

    $

    10.0



    $

    (3.1)



    $

    28.7



    $

    (8.0)


    Income tax expense/(benefit)

    4.0



    0.1



    11.4



    (4.3)


    Equity in net loss of affiliate

    0.0



    0.0



    0.0



    0.1


    Pre-tax income/(loss)

    $

    13.9



    $

    (2.9)



    $

    40.1



    $

    (12.2)


    Adjustments

    5.0



    4.9



    4.9



    4.9


    Adjusted pre-tax income/(loss)

    $

    18.9



    $

    2.0



    $

    45.0



    $

    (7.3)


    Adjusted income tax

    (5.3)



    (0.3)



    (12.6)



    1.2


    Equity in net loss of affiliate

    0.0



    0.0



    0.0



    (0.1)


    Non-controlling interest

    (0.1)



    (0.2)



    (0.6)



    (0.5)


    Adjusted net income/(loss)

    $

    13.5



    $

    1.4



    $

    31.7



    $

    (6.6)










    Adjusted earnings/(loss) per common share








    Basic

    $

    0.30



    $

    0.03



    $

    0.71



    $

    (0.14)


    Diluted

    $

    0.30



    $

    0.03



    $

    0.70



    $

    (0.14)










    Weighted average common shares outstanding used in
    computing earnings/(loss) per common share








    Basic

    44,553,903



    46,323,038



    44,787,875



    47,295,843


    Diluted

    44,984,721



    46,530,002



    45,270,797



    47,295,843





    Note:  Dollars in millions, except per share data and where noted otherwise.  Columns may not add due to rounding.

    Net Income/(Loss) to Adjusted Net Income/(Loss) and Adjusted EPS
    (unaudited)



    Three Months Ended


    Six Months Ended


    June 30,


    June 30,


    2018


    2017


    2018


    2017

    Net income/(loss) applicable to Gain Capital Holdings Inc.

    $

    67.1



    $

    13.9



    $

    83.2



    $

    (4.9)


    Income tax expense/(benefit)

    (0.3)



    1.5



    7.4



    (4.4)


    Equity in net loss of affiliate

    0.0



    0.0



    0.0



    0.1


    Non-controlling interest

    0.3



    0.2



    0.5



    0.2


    Net Income from discontinued operations

    (60.6)



    (0.6)



    (65.0)



    (0.2)


    Pre-tax income/(loss)

    $

    6.6



    $

    15.1



    $

    26.2



    $

    (9.3)


    Adjustments

    0.0



    0.0



    (0.1)



    0.0


    Adjusted pre-tax income/(loss)

    $

    6.6



    $

    15.1



    $

    26.1



    $

    (9.3)


    Adjusted income tax

    (1.8)



    (3.6)



    (7.2)



    2.2


    Equity in net loss of affiliate

    0.0



    0.0



    0.0



    (0.1)


    Non-controlling interest

    (0.3)



    (0.2)



    (0.5)



    (0.2)


    Adjusted net income/(loss)

    $

    4.4



    $

    11.3



    $

    18.4



    $

    (7.4)










    Adjusted earnings/(loss) per common share








    Basic

    $

    0.10



    $

    0.24



    $

    0.41



    $

    (0.15)


    Diluted

    $

    0.10



    $

    0.24



    $

    0.40



    $

    (0.15)










    Weighted average common shares outstanding used in computing earnings/(loss) per common share








    Basic

    44,797,103



    47,687,214



    44,906,800



    47,790,307


    Diluted

    45,309,002



    47,894,648



    45,415,774



    47,790,307


    __________________


    Note:  Dollars in millions, except per share data and where noted otherwise.  Columns may not add due to rounding.

     

     

    Adjusted Income Tax (Expense)/ Benefit Reconciliation

    (unaudited)



    Three Months Ended Sept. 30,


    Nine Months Ended Sept. 30,


    2018


    2017


    2018


    2017









    GAAP Tax (expense)/benefit

    $

    (4.0)



    $

    (0.1)



    $

    (11.4)



    $

    4.3


    GAAP Tax Rate

    28.8

    %


    (3.4)

    %


    28.4

    %


    35.2

    %









    Uncertain tax position

    0.0



    0.0



    (0.2)



    (2.1)


    Tax true up

    0.1



    0.6



    0.4



    (0.1)


    One off adjustments

    (1.4)



    (0.8)



    (1.4)



    (0.8)


    Adjusted tax (expense)/benefit

    $

    (5.3)



    $

    (0.3)



    $

    (12.6)



    $

    1.2


    Adjusted tax rate

    28.0

    %


    16.9

    %


    28.0

    %


    16.9

    %

     

    Reconciliation of GAAP Net Income to Adjusted EBITDA and Adjusted EBITDA Margin

    Adjusted EBITDA is a non-GAAP financial measure that represents our earnings/(loss) before interest, taxes, depreciation and amortization, purchased intangible amortization, convertible note interest, contingent provision, non-controlling interest and debt extinguishment. This non-GAAP financial measure has certain limitations, including that it does not have a standardized meaning and, therefore, our definition may be different from similar non-GAAP financial measures used by other companies and/or analysts. Thus, it may be more difficult to compare our financial performance to that of other companies. We believe our reporting of adjusted EBITDA assists investors in evaluating our operating performance. However, because adjusted EBITDA is not a measure of financial performance calculated in accordance with GAAP, such measure should be considered in addition to, but not as a substitute for, other measures of our financial performance reported in accordance with GAAP, such as net income/(loss).

     

    Reconciliation of GAAP Net Income/(Loss) to Adjusted EBITDA and Adjusted EBITDA Margin

    (unaudited)



    Three Months Ended

    Nine Months Ended


    September 30,

    September 30,


    2018


    2017

    2018


    2017

    Net revenue

    $

    95.5



    $

    73.8


    $

    278.1



    $

    215.5


    Net income/(loss) from continuing operations

    10.0



    (3.1)


    28.7



    (8.0)


    Net income/(loss) margin % (1)

    10

    %


    (4)

    %

    10

    %


    (4)

    %








    Net income/(loss)

    $

    10.0



    $

    (3.1)


    $

    28.7



    $

    (8.0)


    Depreciation and amortization

    4.7



    4.4


    15.4



    12.3


    Purchased intangible amortization

    3.5



    3.5


    10.8



    10.4


    Interest expense on long term borrowings

    3.4



    3.0


    10.1



    8.3


    Income tax (benefit)/expense

    4.0



    0.1


    11.4



    (4.3)


    Contingent provision

    5.0



    0.0


    5.0



    0.0


    Impairment of investment

    0.0



    0.0


    (0.1)



    0.0


    Equity in net loss of affiliate

    0.0



    0.0


    0.0



    0.1


    Loss on extinguishment of debt

    0.0



    4.9


    0.0



    4.9


    Adjusted EBITDA

    30.5



    12.9


    $

    81.3



    $

    23.8


    Adjusted EBITDA Margin(2)

    32

    %


    17

    %

    29

    %


    11

    %




    Note:  Dollars in millions, except where noted otherwise.  Columns may not add due to rounding.

    1 Net income/(loss) margin % includes the gain on discontinued operations

    2 Adjusted EBITDA margin is calculated as adjusted EBITDA divided by net revenue.

    Reconciliation of GAAP Net Income/(Loss) to Adjusted EBITDA and Adjusted EBITDA Margin
    (unaudited)



    Three Months Ended

    Six Months Ended


    June 30,

    June 30,


    2018


    2017

    2018


    2017

    Net revenue

    $

    84.2



    $

    90.6


    $

    182.5



    $

    141.8


    Net income/(loss) applicable to Gain Capital Holdings Inc.

    67.1



    13.9


    83.2



    (4.9)


    Net income/(loss) margin % (1)

    80

    %


    15

    %

    46

    %


    (3)

    %








    Net income/(loss)

    $

    67.1



    $

    13.9


    $

    83.2



    $

    (4.9)


    Depreciation and amortization

    5.3



    4.1


    10.7



    7.9


    Purchased intangible amortization

    3.6



    3.8


    7.3



    6.9


    Interest expense on long term borrowings

    3.4



    2.7


    6.7



    5.4


    Income tax expense/(benefit)

    (0.3)



    1.5


    7.4



    (4.4)


    Impairment of investment

    0.0



    0.0


    (0.1)



    0.0


    Equity in net loss of affiliate

    0.0



    0.0


    0.0



    (0.1)


    Net income attributable to non-controlling interests

    0.3



    0.2


    0.5



    0.2


    Discontinued operations (2)

    (60.6)



    (0.6)


    (65.0)



    (0.2)


    Adjusted EBITDA

    19.0



    25.7


    $

    50.8



    $

    11.0


    Adjusted EBITDA Margin(3)

    23

    %


    28

    %

    28

    %


    8

    %

    ____________


    Note:  Dollars in millions, except where noted otherwise.  Columns may not add due to rounding.

    1 Net income/(loss) margin % includes the gain on discontinued operations

    2 Discontinued operations amounts shown under continuing operations represent income from discontinued operations

    3 Adjusted EBITDA margin is calculated as adjusted EBITDA divided by net revenue.

     

    Segment Information:

    ASC 280, Disclosures about Segments of an Enterprise and Related Information, establishes standards for reporting information about operating segments. Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision-maker, or decision making group, in deciding how to allocate resources and in assessing performance. Reportable segments are defined as an operating segment that either (a) exceeds 10% of revenue, or (b) reported profit or loss in absolute amount exceeds 10% of profit of all operating segments that did not report a loss or (c) exceeds 10% of the combined assets of all operating segments. The Company's operations relate to global trading services and solutions. Based on the Company's management strategies, and common production, marketing, development and client coverage teams, the Company has concluded that it operates in two operating segments: Retail Segment and Futures Segment.

    Retail


    Three Months Ended
    September 30,


    Nine Months Ended
    September 30,


    2018


    2017


    2018


    2017

    Trading Revenue

    $

    82.9



    $

    62.1



    $

    239.1



    $

    180.2


    Other Retail Revenue

    2.9



    1.8



    7.0



    4.5


    Total Revenue

    85.9



    63.9



    246.1



    184.6










     Employee Compensation & Benefits

    14.4



    12.7



    43.4



    40.5


    Marketing

    10.0



    6.3



    22.1



    22.4


    Referral Fees

    5.3