INTL FCStone Inc. (NASDAQ:INTL) Q1 2016 Earnings Conference Call - Final Transcript

Feb 10, 2016 • 09:00 am ET

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INTL FCStone Inc. (NASDAQ:INTL) Q1 2016 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Good morning ladies and gentlemen and welcome to the INTL FCStone Q1 Fiscal Year 2016 Earnings conference call. At this time, all participants are in a listen-only mode. Later we will conduct a question and answer session and instructions will follow at that time. [Operator Instructions] As a reminder, this conference is being recorded.

I would now like to introduce your host for today's conference, Mr. Bill Dunaway, Chief Financial Officer. Sir, you may begin.

Executive
William Dunaway

Good morning. My name is Bill Dunaway, CFO of INTL FCStone. Welcome to our earnings conference call for our fiscal first quarter ending December 31, 2015. After the market closed yesterday, we issued a press release reporting our results for the fiscal first quarter. This release is available on our website at www.intlfcstone.com, as well as a slide presentation which we will refer to on this call in our discussions of our quarterly results. You will need to sign on to the live webcast in order to view the presentation. Both the presentation and an archive of the webcast will also be available on our website after the call's conclusion.

Before getting underway, we're required to advise you and all participants should note that the following discussion should be taken in conjunction with the most recent financial statements and notes thereto, as well as the Form 10-Q filed with the SEC. This discussion may contain forward-looking statements within the meaning of Section 27(a) of the Securities Exchange Act of 1933 and Section 21(e) of the Securities Exchange Act of 1934.

These forward-looking statements involve known and unknown risks and uncertainties which are detailed in our filings with the SEC. Although the company believes that its forward-looking statements are based upon reasonable assumptions regarding its business and future market conditions, there can no assurances that the company's actual results will not differ materially from any results expressed or implied by the company's forward-looking statements.

The company undertakes no obligation to publicly update or revise any forward-looking statements whether as a result of new information, future events or otherwise. Readers are cautioned that any forward-looking statements are not guarantees of future performance.

With that, I'll now turn the call over to Sean O'Connor, the company's CEO.

Executive
Sean O'Connor

Thanks Bill, and good morning everyone, and welcome to our fiscal 2016 first quarter earnings call. We had strong core operating results during the quarter in spite of the difficult macro environment, especially in commodities. Total segment net income was up 26% with very strong gains from securities and global payment segments offsetting declines in our commodities-related segments. This strong growth in aggregate segment net income was offset by mark-to-market losses on our portfolio of interest rate instruments held to enhance our return on our segregated client assets. This is a reversal of prior gains recorded in the preceding quarter. Excluding the impact of these mark-to-market adjustments, our core operating earnings were significantly ahead of the same quarter a year ago, although still slightly behind our record fourth quarter results.

As we