UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): December 4, 2012 (November 30, 2012)
INVESTMENT TECHNOLOGY GROUP, INC.
(Exact name of registrant as specified in its charter)
Delaware |
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001-32722 |
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95-2848406 |
(State or Other |
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(Commission File |
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(I.R.S. Employer |
Jurisdiction of |
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Number) |
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Identification No.) |
Incorporation) |
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380 Madison Avenue |
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New York, New York |
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10017 |
(Address of Principal Executive Offices) |
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(Zip Code) |
Registrants telephone number, including area code: (212) 588-4000
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)
Item 2.05 Costs Associated with Exit or Disposal Activities.
On December 4, 2012, Investment Technology Group, Inc. (ITG or the Company) announced a cost reduction plan designed to improve financial performance primarily focused on headcount, market data, and other general and administrative costs across ITGs businesses. The plan stems from a comprehensive review of ITGs various business activities, benchmarking ITGs cost structure against industry peers. The reductions reflect in part the impact of improved efficiencies from recent investments in product and infrastructure as well as secular changes in the business environment. ITG expects to incur pre-tax charges in the fourth quarter of 2012 for employee separation and related costs estimated at $8.5 million, or $0.14 per share after taxes. Of these estimated $8.5 million of pre-tax charges, future cash expenditures are anticipated to be $7.9 million.
Significant actions relating to this restructuring are anticipated to be substantially completed by the end of the fourth quarter of 2012. Most of the cost savings will begin to take effect during the first quarter of 2013. ITG expects these activities to result in pre-tax annual cost savings of approximately $20 million, or $0.32 per share after taxes, in 2013.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
(b) On November 30, 2012, the Company and David Stevens mutually agreed that, effective January 31, 2013, Mr. Stevens will be leaving the Company. The Company and Mr. Stevens are currently discussing the final terms of an agreement related to his departure.
Item 9.01 Financial Statements and Exhibits.
Exhibits |
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99.1 |
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Press Release issued by Investment Technology Group, Inc. on December 4, 2012. |
ITG Forward Looking Statements
In addition to historical information, this 8-K may contain forward-looking statements that reflect managements expectations for the future. A variety of important factors could cause results to differ materially from such statements. These factors are noted throughout ITGs 2011 Annual Report, on its Form 10-K, and on its Form 10-Qs and include, but are not limited to, general economic, business, credit and financial market conditions, internationally and nationally, financial market volatility, fluctuations in market trading volumes, effects of inflation, adverse changes or volatility in interest rates, fluctuations in foreign exchange rates, evolving industry regulations, changes in tax policy or accounting rules, the actions of both current and potential new competitors, changes in commission pricing, the volatility of our stock price, rapid changes in technology, errors or malfunctions in our systems or technology, cash flows into or redemptions from equity mutual funds, ability to meet liquidity requirements related to the clearing of our customers trades, customer trading patterns, the success of our products and service offerings, our ability to continue to innovate and meet the demands of our customers for new or enhanced products, our ability to successfully integrate acquired companies and our ability to attract and retain talented employees. Our ability to achieve cost savings from this cost reduction plan is also subject to certain risks and uncertainties that could cause such statements to differ materially from actual future results. The forward looking statements included herein represent ITGs views as of the date of this report. We undertake no obligation to revise or update publicly any forward-looking statement for any reason unless required by law.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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INVESTMENT TECHNOLOGY GROUP, INC. | ||
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By: |
/s/ P. Mats Goebels |
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P. Mats Goebels |
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Managing Director, General Counsel and Duly Authorized Signatory of Registrant |
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Dated: December 4, 2012 |
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Exhibit 99.1
ITG Announces Cost Reduction Measures
Initiative to Yield Cost Savings of Approximately $20 Million in 2013
NEW YORK, December 4, 2012 ITG (NYSE:ITG), a leading execution and research broker, today announced a plan to reduce operating costs in the face of continued weakness in institutional equity trading volumes. This cost reduction initiative is designed to improve financial performance while maintaining ITGs competitiveness and high standards of client service. This plan stems from a comprehensive review of ITGs various business activities, benchmarking ITGs cost structure against industry peers. The cost reductions are primarily focused on headcount, market data and other general and administrative costs across ITGs businesses.
Given the difficult business environment, we examined every aspect of our cost structure across all businesses and geographies, said ITGs Chief Executive Officer and President, Bob Gasser. While the staff reductions were a difficult decision, they are a necessary step to ensure the long-term competitiveness and profitability of ITG. These reductions will not impair our ability to capitalize on any future improvements in global trading volumes.
The reductions reflect in part the impact of improved efficiencies from recent investments in product and infrastructure as well as secular changes in the business environment. This initiative is expected to generate pre-tax cost savings of approximately $20 million in 2013, or $0.32 per share after taxes. Most of the cost savings will begin to take effect during the first quarter of 2013. ITG will incur pre-tax charges associated with this plan estimated at $8.5 million, or $0.14 per share after taxes, in the fourth quarter of 2012.
About ITG
ITG is an independent execution and research broker that partners with global portfolio managers and traders to provide unique data-driven insights throughout the investment process. From investment decision through settlement, ITG helps clients understand market trends, improve performance, mitigate risk and navigate increasingly complex markets. ITG is headquartered in New York with offices in North America, Europe, and Asia Pacific. For more information, please visit www.itg.com.
In addition to historical information, this press release may contain forward-looking statements that reflect managements expectations for the future. A variety of important factors could cause results to differ materially from such statements. Certain of these factors are noted throughout ITGs 2011 Annual Report on Form 10-K, and its Form 10-Qs and include, but are not limited to, general economic, business, credit and financial market conditions, internationally and nationally, financial market volatility, fluctuations in market trading volumes, effects of inflation, adverse changes or volatility in interest rates, fluctuations in foreign exchange rates, evolving industry regulations, changes in tax policy or accounting rules, the actions of both current and potential new competitors, changes in commission pricing, the volatility of our stock price, rapid changes in technology, errors or malfunctions in our systems or technology, cash flows into or redemptions from equity mutual funds, ability to meet liquidity requirements related to the clearing of our customers trades, customer trading patterns, the success of our products and service offerings, our ability to continue to innovate and meet the demands of our customers for new or enhanced products, our ability to successfully integrate acquired companies and our ability to attract and retain talented employees. Our ability to achieve cost savings from this cost reduction plan is also subject to certain risks and uncertainties that could cause such statements to differ materially from actual future results. The forward-looking statements included herein represent ITGs views as of the date of this release. ITG undertakes no obligation to revise or update publicly any forward-looking statement for any reason unless required by law.
ITG Media/Investor Contact:
J.T. Farley
(212) 444-6259
corpcomm@itg.com
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