BGC Group, Inc. Q4 FY2024 earnings call

• BGC delivered record fourth quarter and full-year revenues, growing 11% and 12% respectively. - Strong growth in ECS, rates, and foreign exchange businesses. - Closed acquisition of Sage Energy Partners and expect to close OTC Holdings by end of Q1 2025, which will contribute over $450M in annual revenues. - Total revenues in Q4 were $572.3M, with growth across all regions and asset classes. - Brokerage, rates, ECS, foreign exchange, data/network/post-trade revenues showed various growth or decline trends based on different segments. - Fenics had revenue growth, with FMX UST and FX showing volume increases.

Total revenues for the fourth quarter were $572.3 million, a 10.8% growth. Brokerage revenues grew 11.8% to $516.1 million. Rates revenues increased 8.8% to $169.6 million. ECS revenues grew 28% to $134.1 million. Foreign exchange revenues were up 21.3% to $93.6 million. Credit revenues decreased 4.9% to $62.4 million. Equities revenues declined 3.5% to $56.3 million. Data, network and post-trade revenues improved 10.3% to $32.6 million. Fenics revenues improved 8.6% to $142.1 million, with Fenics Markets up 6.4% and Fenics Growth Platforms up 20.2%. FMX UST had average daily volumes over $52 billion in Q4, up 28%.

• Expect total revenues for Q1 2025 to be between $610 million and $660 million, representing ~10% revenue growth. - Anticipate pretax adjusted earnings to be in the range of $145 million to $161 million, representing ~13% earnings growth.

• Expectations are subject to macroeconomic, social, political and other factors. - Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ from expectations.

Q: How are the executive leadership transition timeline and Howard's BGC share sale plans?

A: Howard will divest holdings within 90 days of Senate confirmation, with public SEC filings. John, JP, and Sean are excited as they've managed day-to-day business for 3 years.

Q: How much growth did the Sage acquisition contribute in 4Q and first quarter?

A: Sage added 1-2 percentage points to 4Q growth and expects the same in Q1 2025.

Q: What's driving pretax adjusted earnings growth in Q1?

A: Revenue growth with cost base not growing in line, small acquisitions plugging into platform for economies of scale, and movement of business to electronic with higher margins.

Q: FMX timeline and market share?

A: On track for U.S. Treasury futures launch in Q1, ahead of progress compared to launch, year one for bank connectivity, year two for client connectivity, year three for competition.

Q: OTC acquisition revenue and margins?

A: OTC expected to be ~$400M annual revenue, margin lower than core business initially, around 15% initially, highly accretive from day one.

Q: Stock-based comp treatment?

A: Stock-based comp used for retention, proved successful, overall level has come down, but will continue to monitor.