XML 36 R24.htm IDEA: XBRL DOCUMENT
v3.21.2

Segment Analysis | 9 Months Ended
--- | ---
Jun. 30, 2021
Segment Reporting [Abstract] |
Segment Analysis | Segment Analysis During the three months ended September 30, 2020, the Company completed its acquisition of Gain, which it views as a significant acquisition and which triggered a reassessment of the financial information reviewed by its executive management team, which the Company considers its Chief Operating Decision Maker, on a regular basis, and which is used to make resource allocation decisions. In light of this fundamental change and reassessment described above, the Company modified the operating segments it uses to evaluate its performance. Accordingly, its operating segments are now based primarily on the nature of the clients we serve (commercial, institutional, and retail), and a fourth operating segment, its global payments business. The Company manages its business in this manner due to its large global footprint, in which it has more than 3,000 employees allowing it to serve clients in more than 180 countries. Following the acquisition of Gain, the Company’s business activities are managed as operating segments and organized into reportable segments as follows: •Commercial •Institutional •Retail •Global Payments All segment information has been revised to reflect the operating segment reorganization retroactive to October 1, 2019. Commercial The Company offers commercial clients a comprehensive array of products and services, including risk management and hedging services, execution and clearing of exchange-traded and OTC products, voice brokerage, market intelligence and physical trading, as well as commodity financing and logistics services. The ability to provide these high-value-added products and services differentiates the Company from its competitors and maximizes the opportunity to retain clients. Institutional The Company provides institutional clients with a complete suite of equity trading services to help them find liquidity with best execution, consistent liquidity across a robust array of fixed income products, competitive and efficient clearing and execution in all major futures and securities exchanges globally, as well as prime brokerage in equities and major foreign currency pairs and swap transactions. In addition, the Company originates, structures and places debt instruments in the international and domestic capital markets. These instruments include asset-backed securities (primarily in Argentina) and domestic municipal securities. Retail The Company provides retail clients around the world access to over 15,000 global financial markets, including spot foreign exchange ("forex"), both financial trading and physical investment in precious metals, as well as contracts for difference (“CFDs”), which are investment products with returns linked to the performance of underlying assets. In addition, its independent wealth management business offers a comprehensive product suite to retail investors in the U.S. Global Payments The Company provides customized foreign exchange and treasury services to banks and commercial businesses, as well as charities and non-governmental organizations and government organizations. The Company provides transparent pricing and offers payments services in more than 170 countries and 140 currencies, which it believes is more than any other payments solution provider. ******** The total revenues reported combine gross revenues from physical contracts for subsidiaries that are not broker-dealers and net revenues for all other businesses. In order to reflect the way that the Company’s management views the results, the table below also reflects the segment contribution to ‘operating revenues’, which is shown on the face of the consolidated income statements and which is calculated by deducting physical commodities cost of sales from total revenues. Segment data includes the profitability measure of net contribution by segment. Net contribution is one of the key measures used by management to assess the performance of each segment and for decisions regarding the allocation of the Company’s resources. Net contribution is calculated as revenue less direct cost of sales, transaction-based clearing expenses, variable compensation, introducing broker commissions, and interest expense. Variable compensation paid to risk management consultants/traders generally represents a fixed percentage of revenues generated, and in some cases, revenues generated less transaction-based clearing expenses, base salaries and an overhead allocation. Segment data also includes segment income which is calculated as net contribution less non-variable direct expenses of the segment. These non-variable direct expenses include trader base compensation and benefits, operational employee compensation and benefits, communication and data services, business development, professional fees, bad debt expense and other direct expenses. Inter-segment revenues, expenses, receivables and payables are eliminated upon consolidation, except revenues and expenses related to foreign currency transactions undertaken on an arm’s length basis by the foreign exchange trading business for the securities business. The foreign exchange trading business competes for this business as it does any other business. If its rates are not competitive, the securities businesses buy or sell their foreign currency through other market participants. Total revenues, operating revenues and net operating revenues shown as “Corporate Unallocated” primarily consist of interest income from its centralized corporate treasury function. In the normal course of operations, the Company operates a centralized corporate treasury function in which it may sweep excess cash from certain subsidiaries, where permitted within regulatory limitations, in exchange for a short-term interest bearing intercompany payable, or provide excess cash to subsidiaries in exchange for a short-term interest bearing intercompany receivable in lieu of the subsidiary borrowing on external credit facilities. The intercompany receivables and payables are eliminated during consolidation; however, this practice may impact reported total assets between segments. Net costs not allocated to operating segments include costs and expenses of certain shared services such as information technology, accounting and treasury, credit and risk, legal and compliance, and human resources and other activities. Information for the reportable segments is shown in accordance with the Segment Reporting Topic of the ASC as follows:
| Three Months Ended June 30, |  | Nine Months Ended June 30,
(in millions) | 2021 |  | 2020 |  | 2021 |  | 2020
Total revenues: |  |  |  |  |  |  |
Commercial | $ | 9,449.3 |  |  | $ | 7,968.1 |  |  | $ | 28,831.2 |  |  | $ | 39,011.8 |
Institutional | 173.0 |  |  | 169.8 |  |  | 530.1 |  |  | 487.9 |
Retail | 541.2 |  |  | 79.1 |  |  | 1,236.9 |  |  | 271.9 |
Global Payments | 35.0 |  |  | 27.4 |  |  | 102.9 |  |  | 88.2 |
Corporate Unallocated | (2.0) |  |  | 2.3 |  |  | (1.3) |  |  | 11.5 |
Eliminations | (4.4) |  |  | (3.3) |  |  | (12.4) |  |  | (16.6) |
Total | $ | 10,192.1 |  |  | $ | 8,243.4 |  |  | $ | 30,687.4 |  |  | $ | 39,854.7 |
Operating revenues: |  |  |  |  |  |  |
Commercial | $ | 152.2 |  |  | $ | 104.3 |  |  | $ | 402.1 |  |  | $ | 323.7 |
Institutional | 173.0 |  |  | 169.8 |  |  | 530.1 |  |  | 487.9 |
Retail | 77.7 |  |  | 22.1 |  |  | 261.6 |  |  | 71.5 |
Global Payments | 35.0 |  |  | 27.4 |  |  | 102.9 |  |  | 88.2 |
Corporate Unallocated | (2.0) |  |  | 2.3 |  |  | (1.3) |  |  | 11.5 |
Eliminations | (4.4) |  |  | (3.3) |  |  | (12.4) |  |  | (16.6) |
Total | $ | 431.5 |  |  | $ | 322.6 |  |  | $ | 1,283.0 |  |  | $ | 966.2 |
Net operating revenues (loss): |  |  |  |  |  |  |
Commercial | $ | 125.0 |  |  | $ | 86.6 |  |  | $ | 325.8 |  |  | $ | 264.6 |
Institutional | 111.1 |  |  | 113.1 |  |  | 340.2 |  |  | 282.8 |
Retail | 45.9 |  |  | 6.7 |  |  | 168.7 |  |  | 21.3 |
Global Payments | 33.1 |  |  | 26.0 |  |  | 97.5 |  |  | 83.8 |
Corporate Unallocated | (17.1) |  |  | (4.5) |  |  | (43.9) |  |  | (10.7) |
Total | $ | 298.0 |  |  | $ | 227.9 |  |  | $ | 888.3 |  |  | $ | 641.8 |
Net contribution: |  |  |  |  |  |  |
(Revenues less cost of sales of physical commodities, transaction-based clearing expenses, variable compensation, introducing broker commissions and interest expense) |  |  |  |
Commercial | $ | 86.9 |  |  | $ | 59.2 |  |  | $ | 225.5 |  |  | $ | 181.1 |
Institutional | 69.9 |  |  | 77.3 |  |  | 212.3 |  |  | 195.8 |
Retail | 41.9 |  |  | 6.2 |  |  | 156.0 |  |  | 20.1 |
Global Payments | 26.5 |  |  | 20.9 |  |  | 78.3 |  |  | 67.3 |
Total | $ | 225.2 |  |  | $ | 163.6 |  |  | $ | 672.1 |  |  | $ | 464.3 |
Segment income: |  |  |  |  |  |  |
(Net contribution less non-variable direct segment costs) |  |  |  |  |  |  |
Commercial | $ | 60.4 |  |  | $ | 37.2 |  |  | $ | 148.1 |  |  | $ | 107.6 |
Institutional | 46.5 |  |  | 53.8 |  |  | 143.3 |  |  | 130.5 |
Retail | 6.0 |  |  | 3.8 |  |  | 55.9 |  |  | 13.7 |
Global Payments | 20.3 |  |  | 15.9 |  |  | 60.1 |  |  | 52.0 |
Total | $ | 133.2 |  |  | $ | 110.7 |  |  | $ | 407.4 |  |  | $ | 303.8 |
Reconciliation of segment income to income before tax: |  |  |  |
Segment income | $ | 133.2 |  |  | $ | 110.7 |  |  | $ | 407.4 |  |  | $ | 303.8 |
Net costs not allocated to operating segments | (90.8) |  |  | (61.7) |  |  | (261.8) |  |  | (177.1) |
Gain on acquisitions and other gains | 3.6 |  |  | — |  |  | 3.6 |  |  | 0.1 |
Income before tax | $ | 46.0 |  |  | $ | 49.0 |  |  | $ | 149.2 |  |  | $ | 126.8 |
(in millions) | As of June 30, 2021 |  | As of September 30, 2020 |  |  |  |
Total assets: |  |  |  |  |  |  |
Commercial | $ | 3,357.8 |  |  | $ | 2,753.6 |  |  |  |  |
Institutional | 10,669.6 |  |  | 8,740.8 |  |  |  |  |
Retail | 1,403.2 |  |  | 1,245.9 |  |  |  |  |
Global Payments | 440.4 |  |  | 315.9 |  |  |  |  |
Corporate Unallocated | 928.8 |  |  | 418.7 |  |  |  |  |
Total | $ | 16,799.8 |  |  | $ | 13,474.9 |  |  |  |  |

X
- References No definition available. + Details
Name: | us-gaap_SegmentReportingAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8924-108599 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8981-108599 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8721-108599 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9031-108599 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (f) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (e) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (d) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 22 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8736-108599 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9054-108599 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8657-108599 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8721-108599 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
Name: | us-gaap_SegmentReportingDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration