Global Brokerage : Announces Second Quarter 2021 Result

Assets

Current assets

Cash and cash equivalents

$

68,718

Cash and cash equivalents, held for customers

272,375

Due from brokers

1,745

Accounts receivable, net

2,043

Other assets - Current

6,535

Tax receivable

45

Total current assets

351,461

Deferred tax asset

265

Office, communication and computer equipment, net

22,333

Operating lease right-of-use-assets

11,822

Other intangible assets, net

1,007

Other assets - Non-current

3,822

Total assets

$

390,710

Liabilities, Redeemable non-controlling interest and Stockholders' deficit

Current liabilities

Customer account liabilities

$

272,375

Accounts payable and accrued expenses

22,699

Due to brokers

581

Operating lease liabilities - current

5,107

Credit Agreement

71,634

Other liabilities - current

252

Total current liabilities

372,648

Deferred tax liability

30

New Secured Notes

168,987

Operating lease liabilities - Non-current

12,729

Other liabilities - Non-current

1,350

Total liabilities

555,744

Redeemable non-controlling interest

8,204

Stockholders' deficit

Class A common stock, par value $0.01 per share; 3,000,000,000 shares authorized,

82

8,247,997 shares issued and outstanding

Additional paid-in-capital

361,197

Accumulated deficit

(532,439)

Accumulated other comprehensive loss

(2,115)

Total stockholders' deficit Global Brokerage, Inc.

(173,275)

Other non-controlling interests

37

Total stockholders' deficit

(173,238)

Total liabilities, Redeemable non-controlling interest and Stockholders' deficit

$

390,710

June 30, 2021

Revenues

Three Months

Six Months

Trading revenue

$

22,545

$

53,793

Interest Income

33

89

Brokerage interest expense

(263)

(502)

Net interest expense

(230)

(413)

Other income

417

884

Total net revenues

22,732

54,264

Operating Expenses

Compensation and benefits

13,995

27,794

Referring broker fees

2,017

4,326

Advertising and marketing

5,474

11,586

Communication and technology

3,818

7,596

Trading costs, prime brokerage and clearing fees

505

1,055

General and administrative

6,678

13,351

Depreciation and amortization

2,294

4,712

Total operating expenses

34,781

70,420

Operating Loss

(12,049)

(16,156)

Other Expense

Interest on borrowings

8,987

17,659

Loss from continuing operations before income taxes

(21,036)

(33,815)

Income tax provision

188

408

Loss from continuing operations

(21,224)

(34,223)

Income (loss) from discontinued operations, net of tax

16

(13)

Net Loss

(21,208)

(34,236)

Net loss attributable to redeemable non-controlling interest in

(12,119)

(16,625)

FXCM Group, LLC

Net loss attributable to other non-controlling interests

(1)

(1)

Net loss attributable to Global Brokerage, Inc.

$

(9,088)

$

(17,610)

Loss from continuing operations attributable to Global Brokerage, Inc.

(9,088)

$

(17,610)

Loss from discontinued operations attributable to Global Brokerage,

-

-

Inc.

Net loss attributable to Global Brokerage, Inc.

$

(9,088)

$

(17,610)

Weighted average shares of Class A common stock outstanding -

8,248

8,248

Basic and Diluted

Net loss per share attributable to stockholders of Class A common

stock of Global Brokerage, Inc. - Basic and Diluted:

Continuing operations

$

(1.10)

$

(2.14)

Discontinued operations

-

-

Net loss attributable to Global Brokerage, Inc.

$

(1.10)

$

(2.14)

June 30, 2021

Three Months

Six Months

Net loss

$

(21,208)

$

(34,236)

Other comprehensive loss

Foreign currency translation income (loss), net of tax

30

(440)

Other comprehensive loss income, net of tax

(21,178)

(34,676)

Comprehensive (loss) income

Comprehensive loss attributable to redeemable non-controlling

(12,104)

(16,845)

interest in FXCM Group, LLC

Comprehensive loss attributable to other non-controlling interests

(1)

(1)

Comprehensive loss attributable to Global Brokerage, Inc.

$

(9,073)

$

(17,830)

Global Brokerage, Inc.

Consolidated Statement of Cash Flows

For the Six Months Ended June 30, 2021

(In thousands, unaudited)

Cash Flows From Operating Activities

Net loss

$

(34,236)

Adjustments to reconcile net loss to net cash provided by operating activities

Depreciation

4,712

Right-of-use assets amortization

2,654

Deferred tax benefit

(39)

Amortization of discount - New Secured Notes

10,180

Amortization of issuance cost - New Secured Notes

110

Paid-in-kind interest - New Secured Notes

7,171

Changes in operating assets and liabilities:

Due from brokers

(729)

Accounts receivable, net

(2)

Tax receivable

178

Other assets - Current

(1,814)

Other assets - Non-current

78

Customer account liabilities

3,536

Accounts payable and accrued expenses

(2,624)

Lease liabilities

(3,261)

Other liabilities - Current

8

Other liabilities - Non-current

(119)

Due to brokers

(663)

Foreign currency remeasurement loss

379

Net cash used in operating activities

(14,481)

Cash Flows From Investing Activities

Purchases of office, communication and computer equipment

(1,075)

Payments for software development costs

(3,088)

Purchase of intangible assets

(119)

Net cash used in investing activities

(4,282)

Effect of foreign currency exchange rate changes on Cash and cash equivalents and Cash and

(163)

cash equivalents, held for customers

Net decrease in Cash and cash equivalents and Cash and cash equivalents, held for

(18,926)

customers

Cash and cash equivalents and Cash and cash equivalents, held for customers:

Beginning of period

360,019

End of period

$

341,093

Cash and cash equivalents

$

68,718

Cash and cash equivalents, held for customers

272,375

Cash and cash equivalents and Cash and cash equivalents, held for customers - End of

$

341,093

period

Supplemental disclosures of cash flow activities

Net cash paid for taxes

$

220

Supplemental disclosure of non-cash investing activities

Non-cash recognition of lease right-of-use assets

$

1,578

Escrow withheld in connection with acquisition of intangible

$

200

Supplemental disclosure of non-cash financing activities

Paid-in-kind interest - New Secured Notes

$

7,171