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ITG Reports Record First-Quarter Results EPS Increases 16% to 59 Cents Before Non-Recurring Gain

NEW YORK, April 18, 2001 -- Investment Technology Group, Inc. (NYSE:ITG), a leading provider of technology-based equity trading services, today announced that net income for the first quarter ended March 31, 2001, rose 32% to a record $21 million and diluted earnings per share were $0.65 compared with $0.51 a year ago. These results include the effect of a one-time gain that accounted for $0.06 per diluted share. Excluding this non-recurring gain, pre-tax income was $33.3 million, net income was $19.1 million and diluted earnings per share were $0.59. This represents an increase of 16% over the $0.51 diluted earnings per share in last year's first quarter and 28% over the $0.46 in last year's fourth quarter. Revenue for the first quarter increased 21% to a record $91.7 million.

ITG's average daily revenues grew 23% in the first quarter to $1.5 million, compared to $1.2 million in both the first and fourth quarters of 2000. Compared to the first quarter of 2000, average daily revenue increased 27% in Client Site Products, 23% for the Electronic Trading Desk and 15% in ITG's POSIT® electronic crossing system. Trading volume during the quarter was 5.2 billion shares, compared with 3.9 billion shares in the same quarter last year and 4.2 billion in the fourth quarter of 2000.

"ITG's strong growth in a difficult business environment demonstrates the unique value we are delivering to institutional investors," said Raymond L. Killian, Jr., ITG Chairman, President and Chief Executive Officer. "We are seeing institutional investors becoming even more focused on cutting their trading costs. Our double-digit growth reflects the role that our sophisticated trading system technologies play in helping traders optimize their trading performance by minimizing market impact."

ITG Europe

During the first quarter, ITG Europe sold the 100,000 shares it received upon the demutualization of the London Stock Exchange in 2000. ITG's 50% share of this one-time gain represented $1.9 million, or $0.06 per diluted share and is included within the "net (gain) loss on long-term investments" line item within the accompanying Statement of Operations.

ITG has now received all regulatory approvals required to complete the previously announced acquisition of 50% of ITG Europe from Societe Generale. This transaction should close in the second quarter and bring ITG's ownership of ITG Europe to 100%.

The first quarter 2001 results, as reported above, include the 50% equity share of ITG Europe's results which are reported within the "net (gain) loss on long-term investment" line item. Had ITG acquired 100% of ITG Europe on January 1, 2001, ITG's pro-forma first quarter 2001 results would have included revenues of $94.7 million, pre-tax earnings approximating $31.7 million, net income approximating $17.6 million and diluted earnings per share of $0.55, which would represent approximately $.04 less than the reported earnings of $0.59, before non-recurring gain.

It should be noted that these pro-forma results are based upon initial purchase accounting estimates that may change depending upon the actual closing date of the ITG Europe acquisition and the results of independent valuations.

Conference Call

ITG has scheduled a conference call today at 10:30 a.m. EDT to discuss first quarter results and the outlook for the balance of 2001. Those wishing to listen to the call should dial 800-811-0667 at least 10 minutes prior to the start of the call to ensure connection. For those unable to listen to the live broadcast of the call, a week-long replay will be available by dialing 888-203-1112 and entering the passcode 626190, and a two week-long replay will be available on ITG's website at http://www.itginc.com starting approximately 2 hours after the completion of the call.

About ITG Inc.

ITG is headquartered in New York with offices in Boston, Los Angeles, Dublin, London, Melbourne, Sydney, Tel Aviv and Toronto. As the leading provider of technology-based equity trading services and transaction research to institutional investors and brokers, ITG generates superior trading results for its clients. ITG's services help clients to access liquidity, execute trades more efficiently and make better trading decisions. ITG's cutting edge trading tools are easy to use and interface seamlessly with clients' workflow. As an electronic broker, ITG differentiates itself with institutional customers via front-end or desktop services that provide unique content and connectivity. In the electronic trading marketplace, through its POSIT system, ITG is the premier confidential stock-crossing system for the industry. Further information can be accessed on ITG's Web site at 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, fluctuations in market trading volumes, market volatility, changes in the regulatory environment, risk of errors or malfunctions in our systems or technology, cash flows into or redemptions from equity funds, effects of inflation, customer trading patterns, general economic and business conditions, securities, credit and financial market conditions, as well as adverse changes or volatility in interest rates. These and other risks are described in greater detail in the Company's filings with the Securities and Exchange Commission including those on forms 10-K and 10-Q.

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