INTL FCStone 2005 Annual Report Download - page 25

The following table reflects the net contribution of the Company’s principal business activities for fiscal
year 2005 and fiscal year 2004. Net contribution consist of revenues from each business activity, less direct
clearing and clearing related charges and variable trader compensation.
Fiscal Year
Net
Contribution
Percentage of
Total Net
Contribution
Fiscal Year
Net
Contribution
Percentage of
Total Net
Contribution
Percentage
Change in Net
Contributions
2004-20052005 2005 2004 2004
Equitymarketmaking .............. $ 5,450,000 36% $ 8,737,000 69% -38%
Debt capital markets ................ 1,654,000 11% 1,910,000 15% -13%
Foreign exchange/commodities ....... 8,035,000 53% 1,981,000 16% 306%
Total net Contribution ............. $15,139,000 100% $12,628,000 100% 20%
The following table reflects the principal components of the Company’s non-interest expenses as a
percentage of the Company’s total expenses in fiscal year 2005 and fiscal year 2004.
Fiscal Year
Percentage of
Total Fiscal Year
Percentage of
Total
Percentage
Change in
Expense
2004-20052005 2005 2004 2004
Compensation and benefits ........... $10,483,000 51% $ 8,490,000 50% 23%
Clearing and related expenses ........ 6,168,000 30% 5,990,000 36% 3%
Occupancyandequipmentrental ...... 803,000 4% 513,000 3% 57%
Professional fees ................... 558,000 3% 419,000 2% 33%
Depreciation and amortization ........ 320,000 1% 186,000 1% 72%
Businessdevelopment .............. 765,000 4% 472,000 3% 62%
Insurance......................... 701,000 3% 362,000 2% 93%
Otherexpenses .................... 887,000 4% 512,000 3% 73%
Total non-interest expenses ......... $20,685,000 100% $16,944,000 100% 22%
The following table shows the Company’s earnings before interest, income taxes, depreciation, amortization
and minority interest (‘EBITDA’), together with a reconciliation of EBITDA to net income (loss), for the fiscal
years 2002 through 2005.
EBITDA, a financial measure that is not recognized by generally accepted accounting principles in the
United States of America (‘GAAP’), should not be construed as earnings before income taxes, net earnings or
cash from operating activities as determined by GAAP. The Company defines EBITDA as net income before
(i) interest income; (ii) interest expense; (iii) income taxes; (iv) depreciation and amortization; and (v) minority
shareholder. Other companies may calculate EBITDA differently than the Company does.
EBITDA should not be considered as alternatives to cash flow from operating activities or as alternatives to
net income or as indicators of the Company’s operating performance or any other measures of performance
derived in accordance with GAAP. The Company has included these non-GAAP financial measures because it
believes that it permits investors to make a more meaningful comparison of performance between periods
presented. In addition, the Company’s covenants contained in the loan agreements with certain of its lenders
require certain debt to EBITDA ratios be maintained, thus EBITDA are used by management and the Company’s
lenders in evaluating the Company’s performance.
Fiscal Year Fiscal Year Fiscal Year Fiscal Year
2005 2004 2003 2002
EBITDA ....................................... $5,139,000 $ 5,113,000 $1,808,000 $ 89,000
Interest income .................................. 636,000 167,000 53,000 16,000
Interest expense ................................. (1,335,000) (3,214,000) (44,000) (2,000)
Depreciation and amortization ...................... (320,000) (186,000) (362,000) (377,000)
Incometax ..................................... (1,484,000) (1,998,000) (203,000) 3,000
Minority shareholders ............................ (22,000) — — —
Net income ..................................... $ 2,614,000 $ (118,000) $1,252,000 $(271,000)
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