MF Global moves to fiscal 2nd-quarter profit

NEW YORK - Futures and options broker MF Global on Wednesday reported a fiscal second-quarter profit, reversing a year-ago loss, and topped Wall Street expectations.

The company posted profit of $9.7 million, or 3 cents per share, for the three months ended Sept. 30, compared with a loss of $90.6 million, or 78 cents per share in the year-ago period. Last year's results were weighed down by costs related to initial public offering and a litigation settlement.

Adjusted for several items, and excluding severance costs of 5 cents per share and a bad debt expense related to the bankruptcy of Lehman Brothers Holdings Inc. of 2 cents per share, MF Global said it earned 21 cents per share for the quarter, compared with an adjusted profit of 42 cents per share a year ago.

Net revenue fell to $372.9 million, from $435.5 million in the year-earlier period.

Analysts polled by Thomson Reuters, on average, expected profit of 19 cents per share on revenue of $367.2 million. Analysts typically exclude one-time gains and charges from their estimates.

"The company has effectively balanced risk and reward during one of the most volatile periods in the history of financial markets," said Chief Executive Bernard W. Dan, who took the helm last week, elevated from the position of president and chief operating officer. He has been with the company since June.

Exchange-traded futures and options volume fell 7 percent, to 501.4 million contracts, from 541.5 million contracts in the corresponding period last year.

Cleared commission rate per contract was 43 cents, compared with 38 cents for the same period last year. Clearing volumes fell 8 percent to 358.6 million contracts.

Execution rate per contract was 58 cents, down from 71 cents last year. Execution only volumes fell 7 percent to $142.8 million contracts.

MF Global shares, down 87 percent for the year amid a scandal involving a rogue trader and a management shake up, gained 4 cents to $4.09 in morning trading, after earlier falling as much as 5.7 percent.

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