For the nine months ended September 30, 2003, revenue was $49.4 million, a 28% increase from revenue of $38.5 million for the nine months ended September 30, 2002. Net loss was $2.0 million or $0.06 per common share, for the nine months ended September 30, 2003, compared with a net loss of $3.7 million, or $0.13 per common share, for the same period of 2002.
Cash, cash equivalents and short-term investments were $16.5 million at September 30, 2003 as compared to $21.9 million at each of June 30, 2003 and December 31, 2002. Cash used by operating activities was $2.0 million in the third quarter of 2003 as compared to cash provided by operating activities of $6.1 million in the second quarter of 2003. Cash provided by operating activities was $5.1 million for the nine months ended September 30, 2003 as compared to cash used in operating activities of $2.9 million for the nine months ended September 30, 2002.
Management of the Company said that while revenue increased slightly, the main progress for the third quarter was a strong increase in signed buy-side institutional contracts. Since the start of its buy-side initiative last year, the Company has signed 66 buy-side institutions for NYFIX network and market connectivity services. The Company is still in its early phase of deployment; however it expects a significant ramp up in revenue in 2004 from this market segment from existing products and several new ones.
"We are aggressively looking to take advantage of opportunities in a market segment considerably larger than our traditional market. The reception to our initial offering has been strong and based on our dialogue with some of the largest financial services institutions in this country and abroad we are developing several new and differentiating products," said Peter Kilbinger Hansen, CEO of NYFIX, Inc.
While the brokerage industry is still going through changes, the Company experienced growth from this sector during the third quarter. The competitive combination of the NYFIX listed and the Renaissance OTC product suites has reinvigorated the Company's ability to defend existing revenues, while pursuing new avenues of growth within the brokerage segment.
In addition, with all the recent developments in the listed market during the third quarter, NYFIX Millennium LLC participated in many discussions regarding the possibilities of modifying the NYFIX Millennium system to meet the increasing demand for improved market interaction. As a result NYFIX Millennium LLC has committed to making fundamental changes to both its technology and its business model, thus allowing Millennium resident orders to interact directly with other execution centers in an electronically seamless, throttled and anonymous fashion.
"In this process, we are maintaining the high value of anonymity and power of the NYFIX network and its resident liquidity, while at the same time eliminating the closed environment which has resulted in only a smaller percentage of orders being executed. We have committed to release all Millennium changes and routing hook-ups to other liquidity pools no later than the end of January 2004 and are on track to meet this timetable. The client support we enjoy for these initiatives could potentially mean a significant increase in Millennium LLC revenues," said Robert Gasser, CEO of NYFIX Millennium.
The Company expects revenue for the fourth quarter 2003 to be in the range of $16.5 million to $17.5 million. This compares to $17.3 million for the fourth quarter of 2002 and $16.4 million for the third quarter of 2003. Fourth quarter earnings per common share is expected to be in the range of a net loss of $0.02 per common share to breakeven. This compares to net income of $0.02 in the fourth quarter of 2002 and a net loss of $0.03 per common share in the third quarter 2003.
You are invited to listen to the company's conference call with NYFIX senior management that will be broadcast live over the Internet today, October 29, 2003 at 12 noon EST.