Tradeweb Reports Third Quarter 2021 Financial Results
10/28/2021 - 07:00 AM
NEW YORK --(BUSINESS WIRE)--
Tradeweb Markets Inc. (Nasdaq: TW), a leading, global operator of electronic marketplaces for rates, credit, equities and money markets, today reported financial results for the quarter ended September 30, 2021 .
This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20211028005163/en/
Tradeweb CEO Lee Olesky (Photo: Business Wire)
$265.3 million 24.6% 23.9%
$964.5 billion 23.6% U.S. government bonds. In U.S. credit, Tradeweb set new records for its share of fully electronic TRACE volume: High Grade was 12.6% 7.7% in the prior year period, and High Yield was 6.2% 2.5% in the prior year period
$65.3 million $94.2 million 38.8% 34.6%
50.1% $132.9 million 47.4% or $100.9 million
$0.26 $0.39
$0.08 $12.0 million
Lee Olesky , CEO of Tradeweb Markets :
“Tradeweb’s strong momentum from the first half of the year continued through the third quarter of 2021, producing our second-best revenue quarter ever. Growth in trading volume was broad-based across our markets, with U.S. Credit, global swaps and U.S. Treasuries leading the way. We were delighted to welcome Sara Furber as our new CFO, helping us navigate Tradeweb’s next phase of growth and development. Finally, we published our inaugural Corporate Sustainability Report to increase transparency for our strong foundation in ESG.”
SELECT FINANCIAL
3Q21
3Q20
Change
Constant
(1)
(dollars in thousands except per share amounts)(Unaudited)
GAAP Financial Measures
Total revenue
$
265,325
$
212,870
24.6
%
23.9
%
Rates
$
139,418
$
115,766
20.4
%
19.7
%
Credit
$
72,243
$
50,216
43.9
%
43.2
%
Equities
$
16,457
$
11,857
38.8
%
37.7
%
Money Markets
$
11,221
$
10,491
7.0
%
6.4
%
Market Data
$
20,515
$
18,598
10.3
%
9.2
%
Other
$
5,471
$
5,942
(7.9)
%
(7.9)
%
Net income
$
65,305
$
47,048
38.8
%
Net Income attributable to Tradeweb Markets Inc. (2)
$
54,763
$
36,812
48.8
%
Diluted EPS
$
0.26
$
0.19
36.8
%
Non-GAAP Financial Measures
Adjusted EBITDA (1)
$
132,946
$
100,913
31.7
%
30.0
%
Adjusted EBITDA margin (1)
50.1
%
47.4
%
+270
bps
+234
bps
Adjusted EBIT (1)
$
121,079
$
90,015
34.5
%
32.6
%
Adjusted EBIT margin (1)
45.6
%
42.3
%
+335
bps
+298
bps
Adjusted Net Income (1)
$
94,160
$
69,939
34.6
%
32.7
%
Adjusted Diluted EPS (1)
$
0.39
$
0.30
30.0
%
30.0
%
(1)
Adjusted EBITDA, Adjusted EBITDA margin, Adjusted EBIT, Adjusted EBIT margin, Adjusted Net Income, Adjusted Diluted EPS and constant currency growth are non-GAAP financial measures. See "Non-GAAP Financial Measures" below and the attached schedules for additional information and reconciliations of such non-GAAP financial measures.
(2)
Represents net income less net income attributable to non-controlling interests.
ADV (US $bn)
Asset Class
Product
3Q21
3Q20
YoY
Rates
Cash
$
337
$
311
8.4
%
Derivatives
247
179
37.9
%
Total
584
490
19.2
%
Credit
Cash
8
7
20.0
%
Derivatives
14
13
10.3
%
Total
22
20
13.8
%
Equities
Cash
8
5
38.8
%
Derivatives
7
4
92.9
%
Total
15
9
60.4
%
Money Markets
Cash
344
262
31.3
%
Total
344
262
31.3
%
Total
$
964
$
780
23.6
%
DISCUSSION OF RESULTS
Rates – Revenues of $139.4 million 20.4% compared to prior year period (19.7% on a constant currency basis). Rates ADV was up 19.2% with record trading activity in U.S. Treasuries and strong year-over-year volume growth in European government bonds and swaps/swaptions.
Credit – Revenues of $72.2 million 43.9% compared to prior year period (43.2% on a constant currency basis). Credit ADV was up 13.8% with year-over-year increases in U.S. and European credit trading. In U.S. credit, Tradeweb set new records for its share of fully electronic TRACE volume: High Grade was 12.6% , up from 7.7% in the prior year period and High Yield was 6.2% , up from 2.5% over prior year period.
Equities – Revenues of $16.5 million 38.8% compared to prior year period (37.7% on a constant currency basis). Equities ADV was up 60.4% with robust year-over-year volume growth in U.S. and European ETFs.
Money Markets – Revenues of $11.2 million 7.0% compared to prior year period (6.4% on a constant currency basis). Money Markets ADV was up 31.3% led by a strong year-over-year volume growth in Global Repo trading.
Market Data – Revenues of $20.5 million 10.3% compared to prior year period (9.2% on a constant currency basis). The increase was derived from increased third party market data fees, Refinitiv market data fees, and revenue from our APA reporting service.
Other – Revenues of $5.5 million 7.9% compared to prior year period (7.9% decrease on a constant currency basis).
Operating Expenses – Operating expenses of $179.8 million 16.5% compared to $154.3 million $144.2 million 17.4% (17.5% on a constant currency basis) compared to the prior year period due to: higher employee compensation and benefits associated with higher headcount to support growth and higher performance-related compensation; higher technology and communications expenses; higher general and administrative expenses; and higher professional fees. Please see "Non-GAAP Financial Measures" below for additional information.
RECENT HIGHLIGHTS
Third Quarter 2021
Appointed Sara Furber as Chief Financial Officer
Published Tradeweb’s inaugural Corporate Sustainability Report
Completed first Southbound Bond Connect transactions via the trading link between Tradeweb and China Foreign Exchange Trade System (CFETS), allowing mainland China onshore institutions to invest in Hong Kong’s fixed income markets
Appointed Devi Shanmugham as Global Head of Compliance
Recognized in numerous awards including: Best Workplaces for Innovators (Fast Company ); OTC Trading Venue of the Year (GlobalCapital); OTC Trading Platform of the Year (Asia Risk); Buy-Side Trading System of the Year (Asia Risk); Excellence in Trading Platforms – Jennifer Keser (Markets Media), Rising Star – Santa Dudica
October 2021
Introduced Trade at Close functionality for electronic portfolio trading, allowing U.S. and European clients to electronically execute portfolio trades at end-of-day prices
Named to list of Best ESG Companies of 2021 by Investor’s Business Daily , ranking 36 among top 100 stocks
CAPITAL MANAGEMENT
$821.9 million $500 million September 30, 2021
Non-acquisition related capital expenditures and capitalization of software development in third quarter 2021: $10.0 million
Free cash flow for the trailing twelve months ended September 30, 2021 of $477.4 million 25.6% year over year. See “Non-GAAP Financial Measures” for additional information
During the third quarter of 2021, as part of its Share Repurchase Program, Tradeweb purchased 140,169 shares of Class A common stock, at an average price of $85.61 $12.0 million September 30, 2021 , we purchased a total of 757,813 shares of Class A common stock, at an average price of $84.03 $63.7 million September 30, 2021 , a total of $86.3 million
$3.1 million September 30, 2021 , a total of $56.6 million
The Board of Directors of Tradeweb Markets Inc. declared a quarterly cash dividend of $0.08 December 15, 2021 to stockholders of record as of December 1, 2021
OTHER MATTERS
Full-Year 2021 Guidance*
Full-Year 2021 guidance is unchanged from prior quarter.
Adjusted Expenses: $565 $580 million
Acquisition and Refinitiv Transaction related depreciation and amortization expense: $124 million
Assumed non-GAAP tax rate: 22.0%
Capital expenditures and capitalization of software development: $49 $53 million
*GAAP operating expenses and tax rate guidance are not provided due to the inherent difficulty in quantifying certain amounts due to a variety of factors including the unpredictability in the movement of foreign currency rates.
CONFERENCE CALL
Tradeweb Markets will hold a conference call to discuss third quarter 2021 results starting at 9:30 AM EDT today, October 28, 2021 . A live, audio webcast of the conference call along with related materials will be available at http://investors.tradeweb.com . Alternatively, interested parties can access the call by dialing 866-221-1629 (U.S. ) or +1 470-495-9175 (international) and entering conference ID 9727576. After the conference call, an archived recording will be available at http://investors.tradeweb.com .
ABOUT TRADEWEB MARKETS
Tradeweb Markets Inc. (Nasdaq: TW) is a leading, global operator of electronic marketplaces for rates, credit, equities and money markets. Founded in 1996, Tradeweb provides access to markets, data and analytics, electronic trading, straight-through-processing and reporting for more than 40 products to clients in the institutional, wholesale and retail markets. Advanced technologies developed by Tradeweb enhance price discovery, order execution and trade workflows while allowing for greater scale and helping to reduce risks in client trading operations. Tradeweb serves approximately 2,500 clients in more than 65 countries. On average, Tradeweb facilitated more than $970 billion www.tradeweb.com .
TRADEWEB MARKETS INC.
Three Months Ended September 30 ,
Nine Months Ended September 30 ,
2021
2020
2021
2020
Revenues
(unaudited)
(unaudited)
(unaudited)
(unaudited)
Transaction fees and commissions
$
206,316
$
160,175
$
629,513
$
503,753
Subscription fees
41,390
36,217
117,141
105,706
Refinitiv market data fees
15,002
14,273
45,045
43,466
Other
2,617
2,205
7,865
6,658
Total revenue
265,325
212,870
799,564
659,583
Expenses
Employee compensation and benefits
98,036
83,967
300,107
263,353
Depreciation and amortization
44,823
38,857
127,656
113,952
Technology and communications
14,747
12,037
42,248
34,397
General and administrative
9,561
8,657
21,809
24,520
Professional fees
8,897
7,388
28,993
20,908
Occupancy
3,733
3,443
11,104
10,678
Total expenses
179,797
154,349
531,917
467,808
Operating income
85,528
58,521
267,647
191,775
Net interest income (expense)
(361)
(349)
(1,179)
64
Income before taxes
85,167
58,172
266,468
191,839
Provision for income taxes
(19,862)
(11,124)
(53,365)
(39,898)
Net income
65,305
47,048
213,103
151,941
Less: Net income attributable to non-controlling interests
10,542
10,236
35,165
40,705
Net income attributable to Tradeweb Markets Inc.
$
54,763
$
36,812
$
177,938
$
111,236
Earnings per share attributable to Tradeweb Markets Inc. Class A and B common stockholders:
Basic
$
0.27
$
0.20
$
0.89
$
0.63
Diluted
$
0.26
$
0.19
$
0.86
$
0.60
Weighted average shares outstanding:
Basic
202,238,122
187,774,170
201,029,196
177,257,994
Diluted
208,197,439
194,955,695
206,908,330
185,026,108
TRADEWEB MARKETS INC.
Reconciliation of Net Income to Adjusted EBITDA,
Three Months Ended September 30 ,
Nine Months Ended September 30 ,
2021
2020
2021
2020
(dollars in thousands)
Net income
$
65,305
$
47,048
$
213,103
$
151,941
Acquisition transaction costs (1)
459
—
5,186
—
Net interest (income) expense
361
349
1,179
(64)
Depreciation and amortization
44,823
38,857
127,656
113,952
Stock-based compensation expense (2)
1,995
1,816
11,181
10,308
Provision for income taxes
19,862
11,124
53,365
39,898
Foreign exchange (gains) / losses (3)
141
1,719
(4,742)
5,837
Tax receivable agreement liability adjustment (4)
—
—
—
—
Adjusted EBITDA
$
132,946
$
100,913
$
406,928
$
321,872
Less: Depreciation and amortization
(44,823)
(38,857)
(127,656)
(113,952)
Add: D&A related to acquisitions and the Refinitiv Transaction (5)
32,956
27,959
92,799
81,363
Adjusted EBIT
$
121,079
$
90,015
$
372,071
$
289,283
Adjusted EBITDA margin (6)
50.1
%
47.4
%
50.9
%
48.8
%
Adjusted EBIT margin (6)
45.6
%
42.3
%
46.5
%
43.9
%
(1)
Represents transaction and other costs related to the NFI Acquisition, which closed in June 2021 . Acquisition-related costs primarily include legal, consulting and advisory fees and severance costs incurred that relate to the acquisition transaction.
(2)
Represents non-cash stock-based compensation expense associated with the Special Option Award and post-IPO options awarded in 2019 and payroll taxes associated with exercises of such options during the applicable period. Beginning on August 30, 2021 and during the three and nine months ended September 30, 2021 , this adjustment also includes a total of $0.5 million
(3)
Represents unrealized gain or loss recognized on foreign currency forward contracts and foreign exchange gain or loss from the revaluation of cash denominated in a different currency than the entity’s functional currency.
(4)
Represents income recognized during the applicable period due to changes in the tax receivable agreement liability recorded in the statement of financial condition as a result of changes in the mix of earnings, tax legislation and tax rates in various jurisdictions which impacted our tax savings.
(5)
Represents intangible asset and acquired software amortization resulting from the NFI Acquisition and intangible asset amortization and increased tangible asset and capitalized software depreciation and amortization resulting from the application of pushdown accounting to the Refinitiv Transaction (where all assets were marked to fair value as of the closing date of the Refinitiv Transaction).
(6)
Adjusted EBITDA margin and Adjusted EBIT margin are defined as Adjusted EBITDA and Adjusted EBIT, respectively, divided by revenue for the applicable period.
Reconciliation of Net Income to Adjusted Net Income and Adjusted Diluted EPS
Three Months Ended September 30 ,
Nine Months Ended September 30 ,
2021
2020
2021
2020
(in thousands, except per share amounts)
Earnings per diluted share
$
0.26
$
0.19
$
0.86
$
0.60
—
Net income attributable to Tradeweb Markets Inc.
$
54,763
$
36,812
$
177,938
$
111,236
Net income attributable to non-controlling interests (1)
10,542
10,236
35,165
40,705
Net income
65,305
47,048
213,103
151,941
Provision for income taxes
19,862
11,124
53,365
39,898
Acquisition transaction costs (2)
459
—
5,186
—
D&A related to acquisitions and the Refinitiv Transaction (3)
32,956
27,959
92,799
81,363
Stock-based compensation expense (4)
1,995
1,816
11,181
10,308
Foreign exchange (gains) / losses (5)
141
1,719
(4,742)
5,837
Tax receivable agreement liability adjustment (6)
—
—
—
—
Adjusted Net Income before income taxes
120,718
89,666
370,892
289,347
Adjusted income taxes (7)
(26,558)
(19,727)
(81,596)
(63,656)
Adjusted Net Income
$
94,160
$
69,939
$
289,296
$
225,691
Adjusted Diluted EPS (8)
$
0.39
$
0.30
$
1.22
$
0.97
(1)
Represents the reallocation of net income attributable to non-controlling interests from the assumed exchange of all outstanding LLC Interests held by non-controlling interests for shares of Class A or Class B common stock.
(2)
Represents transaction and other costs related to the NFI Acquisition, which closed in June 2021 . Acquisition-related costs primarily include legal, consulting and advisory fees and severance costs incurred that relate to the acquisition transaction.
(3)
Represents intangible asset and acquired software amortization resulting from the NFI Acquisition and intangible asset amortization and increased tangible asset and capitalized software depreciation and amortization resulting from the application of pushdown accounting to the Refinitiv Transaction (where all assets were marked to fair value as of the closing date of the Refinitiv Transaction).
(4)
Represents non-cash stock-based compensation expense associated with the Special Option Award and post-IPO options awarded in 2019 and payroll taxes associated with exercises of such options during the applicable period. Beginning on August 30, 2021 and during the three and nine months ended September 30, 2021 , this adjustment also includes a total of $0.5 million
(5)
Represents unrealized gain or loss recognized on foreign currency forward contracts and foreign exchange gain or loss from the revaluation of cash denominated in a different currency than the entity’s functional currency.
(6)
Represents income recognized during the applicable period due to changes in the tax receivable agreement liability recorded in the statement of financial condition as a result of changes in the mix of earnings, tax legislation and tax rates in various jurisdictions which impacted our tax savings.
(7)
Represents corporate income taxes at an assumed effective tax rate of 22% applied to Adjusted Net Income before income taxes for each of the three and nine months ended September 30, 2021 and 2020.
(8)
For a summary of the calculation of Adjusted Diluted EPS, see “Reconciliation of Diluted Weighted Average Shares Outstanding to Adjusted Diluted Weighted Average Shares Outstanding” below.
The following table summarizes the calculation of Adjusted Diluted EPS for the periods presented:
Reconciliation of Diluted Weighted Average Shares Outstanding to Adjusted Diluted Weighted Average Shares Outstanding
Three Months Ended September 30 ,
Nine Months Ended September 30 ,
2021
2020
2021
2020
Diluted weighted average shares of Class A and Class B common stock outstanding
208,197,439
194,955,695
206,908,330
185,026,108
Assumed exchange of LLC Interests for shares of Class A or Class B common stock (1)
30,531,933
39,513,246
30,756,925
48,397,598
Adjusted diluted weighted average shares outstanding
238,729,372
234,468,941
237,665,255
233,423,706
Adjusted Net Income (in thousands)
$
94,160
$
69,939
$
289,296
$
225,691
Adjusted Diluted EPS
$
0.39
$
0.30
$
1.22
$
0.97
(1)
Assumes the full exchange of the weighted average of all outstanding LLC Interests held by non-controlling interests for shares of Class A or Class B common stock, resulting in the elimination of the non-controlling interests and recognition of the net income attributable to non-controlling interests.
Reconciliation of Operating Expenses to Adjusted Expenses
Three Months Ended September 30 ,
Nine Months Ended September 30 ,
2021
2020
2021
2020
(in thousands)
Operating expenses
$
179,797
$
154,349
$
531,917
$
467,808
Acquisition transaction costs (1)
(459)
—
(5,186)
—
D&A related to acquisitions and the Refinitiv Transaction (2)
(32,956)
(27,959)
(92,799)
(81,363)
Stock-based compensation expense (3)
(1,995)
(1,816)
(11,181)
(10,308)
Foreign exchange gains / (losses) (4)
(141)
(1,719)
4,742
(5,837)
Adjusted Expenses
$
144,246
$
122,855
$
427,493
$
370,300
(1)
Represents transaction and other costs related to the NFI Acquisition, which closed in June 2021 . Acquisition-related costs primarily include legal, consulting and advisory fees and severance costs incurred that relate to the acquisition transaction.
(2)
Represents intangible asset and acquired software amortization resulting from the NFI Acquisition and intangible asset amortization and increased tangible asset and capitalized software depreciation and amortization resulting from the application of pushdown accounting to the Refinitiv Transaction (where all assets were marked to fair value as of the closing date of the Refinitiv Transaction).
(3)
Represents non-cash stock-based compensation expense associated with the Special Option Award and post-IPO options awarded in 2019 and payroll taxes associated with exercises of such options during the applicable period. Beginning on August 30, 2021 and during the three and nine months ended September 30, 2021 , this adjustment also includes a total of $0.5 million
(4)
Represents unrealized gain or loss recognized on foreign currency forward contracts and foreign exchange gain or loss from the revaluation of cash denominated in a different currency than the entity’s functional currency.
Reconciliation of Cash Flows from Operating Activities to Free Cash Flow
Trailing Twelve Months Ended
September 30, 2021
(in thousands)
Cash flow from operating activities
$
526,072
Less: Capitalization of software development costs
(33,995)
Less: Purchases of furniture, equipment and leasehold improvements
(14,720)
Free Cash Flow
$
477,357
TRADEWEB MARKETS INC.
The following table summarizes the basic and diluted earnings per share calculations for Tradeweb Markets Inc. :
EPS: Net income attributable to Tradeweb Markets Inc.
Three Months Ended September 30 ,
Nine Months Ended September 30 ,
2021
2020
2021
2020
(in thousands, except share and per share amounts)
Numerator:
Net income attributable to Tradeweb Markets Inc.
$
54,763
$
36,812
$
177,938
$
111,236
Denominator:
Weighted average shares of Class A and Class B common stock outstanding - Basic
202,238,122
187,774,170
201,029,196
177,257,994
Dilutive effect of equity-settled PRSUs
2,146,473
2,584,192
2,000,005
2,371,727
Dilutive effect of options
3,516,893
4,402,391
3,609,906
5,264,106
Dilutive effect of RSUs
295,951
194,942
269,223
132,281
Weighted average shares of Class A and Class B common stock outstanding - Diluted
208,197,439
194,955,695
206,908,330
185,026,108
Earnings per share - Basic
$
0.27
$
0.20
$
0.89
$
0.63
Earnings per share - Diluted
$
0.26
$
0.19
$
0.86
$
0.60
TRADEWEB MARKETS INC.
Three Months Ended
Three Months Ended
September 30, 2021
September 30, 2020
$ Change
% Change
Revenues
Variable
Fixed
Variable
Fixed
Variable
Fixed
Variable
Fixed
(dollars in thousands)
Rates
$
80,888
$
58,530
$
64,139
$
51,627
$
16,749
$
6,903
26.1
%
13.4
%
Credit
65,742
6,501
44,278
5,938
21,464
563
48.5
%
9.5
%
Equities
14,235
2,222
9,329
2,528
4,906
(306)
52.6
%
(12.1)
%
Money Markets
7,198
4,023
6,390
4,101
808
(78)
12.6
%
(1.9)
%
Market Data
—
20,515
—
18,598
—
1,917
—
10.3
%
Other
—
5,471
—
5,942
—
(471)
—
(7.9)
%
Total revenue
$
168,063
$
97,262
$
124,136
$
88,734
$
43,927
$
8,528
35.4
%
9.6
%
TRADEWEB MARKETS INC.
Three Months Ended September 30 ,
YoY
2021
2020
% Change
Rates
$
2.15
$
2.03
5.8
%
Cash Rates
$
1.95
$
1.83
6.5
%
Rates Derivatives
$
2.42
$
2.37
1.9
%
Swaps / Swaptions Tenor (greater than 1 year)
$
3.73
$
3.37
10.9
%
Other Rates Derivatives (1)
$
0.20
$
0.25
(18.4)
%
Credit
$
45.67
$
34.89
30.9
%
Cash Credit (2)
$
144.48
$
127.70
13.1
%
Credit Derivatives and U.S. Cash "EP"
$
6.16
$
6.02
2.4
%
Equities
$
15.20
$
15.95
(4.7)
%
Cash Equities
$
24.37
$
20.25
20.3
%
Equity Derivatives
$
5.23
$
9.46
(44.7)
%
Money Markets (Cash)
$
0.33
$
0.38
(14.3)
%
Total Fees per Million
$
2.70
$
2.47
9.5
%
Total Fees per Million excluding Other Rates Derivatives (3)
$
2.97
$
2.65
12.2
%
(1)
Includes Swaps/Swaptions of tenor less than 1 year and Rates Futures.
(2)
The “cash credit” category represents the “credit” asset class excluding (1) credit derivatives and (2) U.S. High Grade and High Yield electronically processed (“EP”) activity.
(3)
Included to contextualize the impact of short-tenored Swaps/Swaptions and Rates Futures on totals for all periods presented.
TRADEWEB MARKETS INC.
2021 Q3
2020 Q3
YoY
Asset Class
Product
ADV (USD mm)
Volume (USD mm)
ADV (USD mm)
Volume (USD mm)
ADV
Rates
Cash
$
337,167
$
21,632,199
$
311,033
$
19,951,302
8.40
%
U.S. Government Bonds
124,578
7,972,973
86,956
5,565,202
43.26
%
European Government Bonds
28,800
1,900,795
24,317
1,604,918
18.44
%
Mortgages
180,033
11,522,093
195,986
12,543,075
(8.14)
%
Other Government Bonds
3,757
236,337
3,774
238,107
(0.46)
%
Derivatives
246,981
15,992,323
179,054
11,612,291
37.94
%
Swaps/Swaptions ≥ 1Y
154,970
10,039,311
122,341
7,919,286
26.67
%
Swaps/Swaptions < 1Y
91,240
5,903,695
56,317
3,667,678
62.01
%
Futures
770
49,317
396
25,327
94.69
%
Total
584,148
37,624,522
490,087
31,563,593
19.19
%
Credit
Cash
8,440
543,735
7,036
455,496
19.95
%
U.S. High Grade
4,371
279,755
3,821
244,569
14.39
%
U.S. High Yield
836
53,502
406
25,978
105.95
%
European Credit
1,707
112,653
1,270
83,831
34.38
%
Municipal Bonds
173
11,056
201
12,851
(13.96)
%
Chinese Bonds
1,233
78,893
1,277
84,292
(3.48)
%
Other Credit Bonds
121
7,876
61
3,975
98.33
%
Derivatives
13,796
895,891
12,507
813,562
10.31
%
Swaps
13,796
895,891
12,507
813,562
10.31
%
Total
22,237
1,439,626
19,543
1,269,058
13.78
%
Equities
Cash
7,551
487,509
5,442
351,468
38.75
%
U.S. ETFs
5,421
346,951
3,849
246,367
40.83
%
Europe ETFs
2,130
140,558
1,592
105,101
33.74
%
Derivatives
6,992
449,243
3,624
233,482
92.93
%
Options/Convertibles/Swaps
3,559
229,356
1,188
77,469
199.49
%
Futures
3,433
219,886
2,436
156,014
40.94
%
Total
14,543
936,752
9,066
584,950
60.41
%
Money Markets
Cash
343,536
22,138,406
261,590
16,847,205
31.33
%
Repurchase Agreements (Repo)
329,374
21,231,648
250,039
16,106,552
31.73
%
Other Money Markets
14,162
906,758
11,551
740,653
22.60
%
Total
343,536
22,138,406
261,590
16,847,205
31.33
%
ADV (USD mm)
Volume (USD mm)
ADV (USD mm)
Volume (USD mm)
YoY
Total
$
964,464
$
62,139,306
$
780,286
$
50,264,805
23.60
%
To access historical traded volumes, go to https://www.tradeweb.com/newsroom/monthly-activity-reports/.
FORWARD-LOOKING STATEMENTS
This release contains forward-looking statements within the meaning of the federal securities laws. Statements related to, among other things, our guidance, including full-year 2021 guidance, and future performance, the industry and markets in which we operate, our expectations, beliefs, plans, strategies, objectives, prospects and assumptions and future events are forward-looking statements. In addition, statements herein relating to the COVID-19 pandemic, the potential impacts of which remain inherently uncertain, are forward-looking statements.
We have based these forward-looking statements on our current expectations, assumptions, estimates and projections. While we believe these expectations, assumptions, estimates and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond our control. These and other important factors, including those discussed under the heading “Risk Factors” in documents of Tradeweb Markets Inc. on file with or furnished to the SEC , may cause our actual results, performance or achievements to differ materially from those expressed or implied by these forward-looking statements. Given these risks and uncertainties, you are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements contained in this release are not guarantees of future performance and our actual results of operations, financial condition or liquidity, and the development of the industry and markets in which we operate, may differ materially from the forward-looking statements contained in this release. In addition, even if our results of operations, financial condition, or liquidity, and events in the industry and markets in which we operate, are consistent with the forward-looking statements contained in this release, they may not be predictive of results or developments in future periods. Any forward-looking statement that we make in this release speaks only as of the date of such statement. Except as required by law, we do not undertake any obligation to update or revise, or to publicly announce any update or revision to, any of the forward-looking statements, whether as a result of new information, future events or otherwise, after the date of this release.
BASIS OF PRESENTATION
Tradeweb Markets Inc. (unless the context otherwise requires, together with its subsidiaries, referred to as “we,” “our,” “Tradeweb,” “Tradeweb Markets” or the “Company”) closed its IPO on April 8, 2019 . As a result of certain reorganization transactions (the “Reorganization Transactions”) completed in connection with the IPO, on April 4, 2019 , Tradeweb Markets Inc. became a holding company whose only material assets consist of its equity interest in Tradeweb Markets LLC (“TWM LLC”) and related deferred tax assets. As the sole manager of TWM LLC , Tradeweb Markets Inc. operates and controls all of the business and affairs of TWM LLC and, through TWM LLC and its subsidiaries, conducts its business. As a result of this control, and because Tradeweb Markets Inc. has a substantial financial interest in TWM LLC , Tradeweb Markets Inc. consolidates the financial results of TWM LLC and its subsidiaries.
Please refer to the Company's previously filed Quarterly Reports on Form 10-Q and Annual Report on Form 10-K for capitalized terms not otherwise defined herein.
TRADEWEB SOCIAL MEDIA
Investors and others should note that Tradeweb Markets announces material financial and operational information using its investor relations website, press releases, SEC filings and public conference calls and webcasts. Information about Tradeweb Markets , its business and its results of operations may also be announced by posts on the Company’s accounts on the following social media channels: Instagram, LinkedIn and Twitter. The information that we post through these social media channels may be deemed material. As a result, we encourage investors, the media, and others interested in Tradeweb Markets to monitor these social media channels in addition to following our press releases, SEC filings and public conference calls and webcasts. These social media channels may be updated from time to time on our investor relations website.
NON-GAAP FINANCIAL MEASURES
This release contains “non-GAAP financial measures,” including Adjusted EBITDA, Adjusted EBITDA margin, Adjusted EBIT, Adjusted EBIT margin, Adjusted Net Income, Adjusted Diluted EPS, Adjusted Expenses and Free Cash Flow, which are supplemental financial measures that are not calculated or presented in accordance with GAAP. We make use of non-GAAP financial measures in evaluating our past results and future prospects. We present these non-GAAP financial measures because we believe they assist investors and analysts in comparing our operating performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance.
Management and our board of directors use Adjusted EBITDA, Adjusted EBITDA margin, Adjusted EBIT and Adjusted EBIT margin to assess our financial performance and believe they are helpful in highlighting trends in our core operating performance, while other measures can differ significantly depending on long-term strategic decisions regarding capital structure, the tax jurisdictions in which we operate and capital investments. Further, our executive incentive compensation is based in part on components of Adjusted EBITDA.
We use Adjusted Net Income and Adjusted Diluted EPS as supplemental metrics to evaluate our business performance in a way that also considers our ability to generate profit without the impact of certain items. Each of the normal recurring adjustments and other adjustments included in Adjusted Net Income and Adjusted Diluted EPS help to provide management with a measure of our operating performance over time by removing items that are not related to day-to-day operations or are non-cash expenses.
We use Adjusted Expenses as a supplemental metric to evaluate our underlying operating performance over time by removing items that are not related to day-to-day operations or are non-cash expenses.
We use Free Cash Flow to assess our liquidity in a way that considers the amount of cash generated from our core operations after non-acquisition related expenditures for capitalized software development costs and furniture, equipment and leasehold improvements.
See the attached schedules for reconciliations of the non-GAAP financial measures contained in this release to their most comparable GAAP financial measure. Non-GAAP financial measures have limitations as analytical tools, and you should not consider these non-GAAP financial measures in isolation or as alternatives to net income attributable to Tradeweb Markets Inc. , net income, earnings per share, operating income, operating expenses or cash flow from operating activities or any other financial measure derived in accordance with GAAP. You are encouraged to evaluate each adjustment included in the reconciliations. In addition, in evaluating Adjusted EBITDA, Adjusted EBITDA margin, Adjusted EBIT, Adjusted EBIT margin, Adjusted Net Income, Adjusted Diluted EPS, Adjusted Expenses and Free Cash Flow, you should be aware that in the future, we may incur expenses similar to the adjustments in the presentation of these non-GAAP financial measures. Our presentation of non-GAAP financial measures should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items. In addition, the non-GAAP financial measures contained in this release may not be comparable to similarly titled measures used by other companies in our industry or across different industries.
We present certain growth information on a “constant currency” basis. Since our consolidated financial statements are presented in U.S. dollars, we must translate non-U.S. dollar revenues and expenses into U.S. dollars. Constant currency growth, which is a non-GAAP financial measure, is defined as growth excluding the effects of foreign currency fluctuations. Constant currency information is calculated by translating the current period and prior period’s results using the annual average exchange rates for the prior period. We use constant currency growth as a supplemental metric to evaluate our underlying performance between periods by removing the impact of foreign currency fluctuations. We present certain constant currency growth information because we believe it provides investors and analysts a useful comparison of our results and trends between periods. This information should be considered in addition to, not as a substitute for, results reported in accordance with GAAP, and may not be comparable to similarly titled measures used by other companies.
View source version on businesswire.com : https://www.businesswire.com/news/home/20211028005163/en/
Investor Relations
Ashley Serrao + 1 646 430 6027
Ashley.Serrao@Tradeweb.com
Media Relations
Daniel Noonan + 1 646 767 4677
Daniel.Noonan@Tradeweb.com
Source: Tradeweb Markets Inc.
