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ITG Reports 2005 Results EPS Increases 67 Percent In 2005

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NEW YORK, NY, February 1, 2006 - Investment Technology Group, Inc. (NYSE: ITG), a leading provider of technology-based trading services and transaction research, today announced that for the fourth quarter ended December 31, 2005, net income was $21.4 million, 69 percent higher than net income of $12.7 million in the fourth quarter of 2004. Earnings were $0.50 per diluted share, an increase of 67 percent versus earnings of $0.30 per diluted share in the fourth quarter of last year. ITG's total revenue for the fourth quarter of 2005 was a record $112.1 million, 25 percent higher than total revenue of $89.6 million for the fourth quarter of 2004. Net income for the fourth quarter of 2005 included $1.9 million, or $0.05 per share, of tax benefits pertaining to the favorable resolution of certain 2001 matters.

Excluding the impact of non-recurring items in the fourth quarter of 2004, revenues increased by 28 percent from fourth quarter 2004 revenues of $87.6 million. Earnings per diluted share of $0.50 in the fourth quarter of 2005 increased 85 percent versus operating earnings of $0.27 per diluted share in the fourth quarter of last year. Pre-tax operating margins in the fourth quarter of 2005 were 28 percent, up from 19 percent in the fourth quarter of 2004. For the full year 2005, pre-tax operating margins were 26 percent, up from 19 percent in 2004.

For the year ended December 31, 2005, revenues were $408.2 million, net income was $67.7 million, and diluted earnings per share were $1.60. Compared to the year ago period, revenues increased by 22 percent, net income increased by 65 percent and diluted earnings per share increased 67 percent. Excluding non-recurring items, revenues increased 24 percent, and net income increased 68 percent, while earnings per share increased 70 percent.

"In 2005, ITG saw significant growth across all product lines resulting from our increased focus on sales, marketing and product development both domestically and internationally," said Ray Killian, ITG's Chairman, President and Chief Executive Officer. "In the fourth quarter we have seen continued strength in our volume and market share in an extremely competitive market environment."

ITG's International revenues were $24.5 million in the fourth quarter of 2005, 24 percent higher than revenues of $19.7 million in the fourth quarter of 2004. For the full year, international revenues were $92 million, representing 23 percent growth over 2004. International pre-tax operating profits of $0.4 million were flat in the fourth quarter of 2005 as compared to the year-ago period. In 2005, international pre-tax operating profits were $5.1 million, more than triple the $1.6 million earned in 2004.

"ITG's European volumes were strong in the fourth quarter, rebounding from a slow third quarter and posting solid gains. We are pleased with the growth in Europe and plan to continue the globalization of our product line," said Mr. Killian.

Conference Call

ITG has scheduled a conference call today at 11:00 a.m. ET to discuss fourth quarter results. Those wishing to listen to the call should dial 1-800-289-0496 at least 10 minutes prior to the start of the call to ensure connection. A listen-only webcast will also be available on ITG's website at www.shareholder.com/itginc/investors/earnings.cfm. For those unable to listen to the live broadcast of the call, a replay will be available for one week by dialing 1-888-203-1112 and entering the pass code 7194046. A replay will be available for two weeks on ITG's website. Both methods of listening to the replay will be available starting approximately two hours after the completion of the conference call.

About ITG

Investment Technology Group, Inc. (NYSE:ITG), is a specialized agency brokerage and technology firm that partners with clients globally to provide innovative solutions spanning the entire investment process. A pioneer in electronic trading, ITG has a unique approach that combines pre-trade analysis, order management, trade execution, and post-trade evaluation to provide clients with continuous improvements in trading and cost efficiency. The firm is headquartered in New York with offices in North America, Europe and the Asia Pacific regions.

For additional information, visit www.itginc.com.

In addition to historical information, this press release may contain "forward-looking" statements, as defined in the Private Securities Litigation Reform Act of 1995, that reflect management's expectations for the future. A variety of important factors could cause results to differ materially from such statements. These factors include the company's ability to achieve expected future levels of sales; the actions of both current and potential new competitors; rapid changes in technology; financial market volatility; general economic conditions in the United States and elsewhere; evolving industry regulation; cash flows into or redemption from equity funds; effects of inflation; customer trading patterns; and new products and services. These and other risks are described in greater detail in the company's Annual Report on Form 10-K for the fiscal year ended December 31, 2004, and other documents filed with the Securities and Exchange Commission and available on the company's web site.

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Contacts:
Maureen Murphy
Investor Relations
(212) 444-6323

Alicia Curran
Media Relations
(212) 444-6130

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