Virtu Financial, Inc. (NASDAQ:VIRT) Q3 2019 Earnings Conference Call - Final Transcript

Nov 05, 2019 • 08:30 am ET


Virtu Financial, Inc. (NASDAQ:VIRT) Q3 2019 Earnings Conference Call - Final Transcript


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Douglas Cifu

product enhancements, while much runway lies ahead let me tell you about the distances we've come. Most importantly client feedback has been overwhelmingly positive and constructive. We continue to receive support and constructive feedback from our global institutional client base as we invest in our global-scaled platform to accelerate our sustainable growth and offshore opportunities.

These opportunities include initiatives that we previously discussed like re-platforming and improving the latency of our alert block crossing product re-platforming and enhancing our global EMS Triton and bringing true multi-asset class capabilities to the new Triton platform as well as new initiatives like our new FX and fixed income modules for our analytics toolkit and our recently announced execution concierge service outsourced trading offering. I'm pleased to tell you that in the three months since our last call we have begun to deliver on each of these initiatives. Alert is a better functioning and less latent platform. Clients are seemed to benefit from the Triton enhancements we discussed on the last call. With over a dozen clients already migrated to the new Triton valor platform and our first FX trades recently completed from a Triton EMS. Although it is still early days client feedback is highly complementary. Our recently announced FX and fixed income analytics modules and our entry into the outsourced trading business with our Execution Concierge Service are both great examples of leveraging our unique position and capabilities to find incremental ways to deliver value to our clients and generate sustainable organic growth. Keeping with that theme today we are announcing the launch of Virtu Capital Markets which will provide select capital market services including at-the-market offerings and corporate buybacks to issuers. I'll discuss the details further in a moment but the idea is consistent with our strategy of leveraging our core market structure expertise global technology platform and distribution network to deliver efficient and transparent products and solutions to the market. Now turning to our specific results, looking at our Execution service business segment our average daily adjusted net trading income increased 1% versus the prior quarter which is reflective of the growth we have been focused on achieving.

This growth is especially impressive given the relatively challenging environment. Specifically noting that global equity volumes were flat to negative compared to the prior quarter and considering the global commission wallet trends the outperformance of our Execution service business segment is a strong testament to the value our clients place on the product and services we provide. As a reminder our Execution Services segment includes our execution brokerage workflow and technology and our analytics business. As we outlined on our previous quarterly updates we have identified $25 million to $50 million of opportunities from leveraging Virtu's best-in-class technology and operational expertise to enhance and expand the legacy ITG products and we're already seeing some of those benefits in Q3. As you know the third quarter represents only the second full quarter of our operations as a combined Virtu and ITG organization. However