StoneX(SNEX) - 2025 Q1 - Quarterly Report

Financial Performance - The company achieved record net operating revenues of $944.3 million, a 20$784.2 million in the prior year[166]. - Net income rose by $16.0 million to$85.1 million, with diluted earnings per share increasing to $2.54 from$2.13[160]. - Operating revenues increased by $70.5 million, or 17$492.1 million in Q4 2024 compared to Q4 2023, with notable increases in FX/CFD contracts (36%) and physical contracts (84%)[178]. - Total revenues for the three months ended December 31, 2024, increased by $8,369.1 million, or 43$27,945.1 million compared to $19,576.0 million in the same period of 2023[205]. Revenue Sources - Operating revenues from physical contracts increased by$41.2 million, driven by a $16.1 million rise in precious metals and a$23.3 million increase in agricultural and energy revenues[171]. - Operating revenues from securities transactions increased by $85.6 million, supported by a 40$378.2 million, reflecting a rise in average client equity and money market/FDIC client balances[161]. - Operating revenues derived from FX/CFD contracts increased by $22.4 million, primarily due to a 23$31.6 million, or 34%, to $124.1 million compared to$92.5 million in the prior year[231]. Segment Performance - The Institutional segment contributed an additional $103.9 million to operating revenues, while the Payments segment saw a decrease of$2.5 million[157]. - Segment income for the Commercial segment increased by $15.0 million, or 17$102.2 million in Q4 2024 compared to $87.2 million in Q4 2023[215]. - Segment income for the Institutional segment increased by$12.9 million, or 20%, to $78.1 million in Q4 2024 compared to$65.2 million in Q4 2023[220]. - Segment income for the Self-Directed/Retail segment increased by $28.2 million, driven by the rise in net operating revenues, despite a$5.2 million increase in non-variable direct expenses[235]. Expenses and Costs - Variable expenses accounted for 52% of total expenses, down from 54% in the prior year, indicating a focus on maintaining a variable cost model[159]. - Total compensation and other expenses increased by $55.0 million, or 17$380.9 million in Q4 2024 compared to Q4 2023[181]. - Transaction-based clearing expenses increased by $12.2 million, or 16$86.5 million in Q4 2024 compared to Q4 2023, maintaining 9% of operating revenues[173]. - Other non-compensation expenses increased by $20.6 million, or 19$128.4 million in Q4 2024 compared to Q4 2023[185]. - Fixed compensation and benefits surged by 50% to $61.0 million, influenced by severance and accelerated compensation due to an executive departure[249]. Tax and Compliance - The effective income tax rate was 27$29.6 billion, up from $27.5 billion as of September 30, 2024[270]. - The company issued$550.0 million in senior secured notes due 2031, with an interest rate of 7.875% per annum[274]. - The company believes that cash flows from operations, available cash, and available borrowings under credit facilities will be adequate to meet future liquidity needs for the following year[287]. - As of December 31, 2024, the company had five committed bank credit facilities totaling $1,205.0 million, with$412.0 million outstanding[276]. - Cash, segregated cash, cash equivalents, and segregated cash equivalents decreased by $329.6 million from$6,672.6 million as of September 30, 2024, to $6,343.0 million as of December 31, 2024[282]. Market and Risk Management - The company is exposed to market risk due to significant price movements and volatility in trading activities, with risk management policies established by the Risk Committee[306][308]. - An estimated 25 basis point decrease in short-term interest rates would result in approximately$5.8 million less in annual net income as of December 31, 2024[315]. - Currency risk arises from fluctuations in foreign exchange rates impacting earnings and assets, with the company executing hedging transactions to mitigate this exposure[317].