StoneX Records 785% Revenue Spike After GAIN Capital Acquisition

StoneX Group Inc, formerly known as INTL FCStone, published its quarterly financial reports as of September 2020. StoneX published for the first time after fully acquiring GAIN Capital.

Alongside the excellent quarterly operating revenue and profit increase, the company recognized an $81.8 million bargain purchase on the GAIN Capital acquisition.

According to StoneX, the bargain purchase gain is not taxable; therefore, they haven’t recorded any corresponding income tax provision amount.

StoneX purchased GAIN Capital for approximately $236 million in an all-cash deal, paying $6 per GAIN Capital share. GAIN Capital operates City Index and Forex.com.

StoneX completed the process in July, meaning they accounted for all the transactional benefits in the last quarter’s financials.

StonesX’s quarterly books’ acquisition amount includes the $9.6 million related acquisition fees to lawyers and investment banks. Another $5.7 million are impairment charges related to capitalization software not yet placed in the service.

StoneX quarterly results

The publicly listed company reported a total quarterly operating revenue of $342.1 million – which is an annual increase of 19%. They said a net income of $226.2 million, which was 30% higher than the previous year.

The quarterly net income of StoneX leaped 185% to $77.4 million. Last year in a comparable quarter, the company reported a net income of $27.2 million.

Additionally, StoneX’s FX contract recorded a 725% jump in revenue. It means Q4 revenue from the FX business segment came in at $48.7 million compared to last year’s $5.9 million.

According to Sean M. O’Çonnor, the company achieved record results in nearly every business area and consolidated. They competed in several transactions, including the significant strategic acquisition of GAIN Capital. They also rebranded the company with an eye towards their future.

Sean M. O’Çonnor is the CEO of StoneX Group.

He also added that they realized a significant amount of non-operating income during the same quarter. The operating income resulted from the gain on the GAIN Capital acquisition transaction.

The FX revenue of the platform spiked 785% from last year.