FXCM Inc. Announces Fourth Quarter and Full Year 2010 Results

Fourth Quarter Highlights:

• 2010 fourth quarter revenues of $96.1 million, up 29% versus the same period in 2009
• Adjusted Pro Forma EBITDA of $32.3 million, up 42% versus the same period in 2009
• Adjusted Pro Forma net income of $18.1 million or $0.24 per fully diluted share, up 37% versus the same period in 2009
• Customer equity of $641.2 million, up 81% from same period in 2009
• Tradeable accounts of 175,240, up 25% from the same period in 2009
• Completed acquisition of ODL Group Ltd., a U.K. – based FX broker
• Completed initial public offering of $242.5 million on New York Stock Exchange

Full-Year Highlights:

• Full year revenues of $360.3 million, up 12% compared to 2009
• Adjusted Pro Forma EBITDA of $120.5 million, up 16% compared to 2009
• Adjusted Pro Forma net income of $69.6 million or $0.92 per fully diluted share, up 13% compared to 2009
• Entered into a Memorandum of Understanding to acquire the retail FX business of GCI Capital of Japan, a FX provider with over 20,000 tradeable accounts and $100 million in customer equity
• Declaring a quarterly dividend of $0.06 per share of Class A common stock

NEW YORK--(BUSINESS WIRE)--FXCM Inc (NYSE: FXCM), a leading online provider of foreign exchange, or FX, trading and related services, today announced for the quarter ended December 31, 2010, revenues increased $21.5 million or 29% to $96.1 million, compared to $74.6 million for the corresponding prior year quarter. Adjusted Pro Forma EBITDA for the quarter was $32.3 million, an increase of $9.5 million or 42%, compared to $22.8 million, for the prior year quarter. Adjusted Pro Forma Net Income was $18.1 million, or $0.24 per share on a fully exchanged, fully diluted basis, compared to $13.2 million, or $0.18 per share, for the corresponding prior year quarter, an increase of 37%.

Adjusted Pro Forma results assume the conversion and exchange of all FXCM Holdings, LLC units into FXCM Inc. Class A shares, resulting in the elimination of the non-controlling interest and the corresponding adjustment to the entity’s tax provision. In addition, Adjusted Pro Forma results eliminate certain non-recurring compensation charges relating to FXCM Inc.’s initial public offering.

For the year ended December 31, 2010, revenues increased $37.6 million or 12% to $360.3 million, compared to $322.7 million for the corresponding prior year. Adjusted Pro Forma EBITDA for the year was $120.5 million, an increase of $16.9 million or 16%, compared to $103.6 million, for the prior year. Adjusted Pro Forma Net Income was $69.6 million, or $0.92 on a fully exchanged, fully diluted basis, compared to $61.4 million, or $0.82 per share, for the corresponding prior year, an increase of 13%.

U.S. GAAP net income for the fourth quarter 2010 was $20.8 million of which $0.2 million or $0.01 per fully diluted share was attributable to FXCM Inc. for the post-IPO period of December 7, 2010 through December 31, 2010. Following the completion of FXCM Inc.’s initial public offering on December 7, 2010, FXCM Holdings, LLC is consolidated into the results of FXCM Inc. Prior to the initial public offering, FXCM Inc. did not engage in any business or activities except in connection with its formation.

“FXCM delivered strong growth in the quarter – growing tradeable accounts by 25%, revenues by 29% and Adjusted Pro Forma EBITDA by 42% versus the fourth quarter 2009,” said Drew Niv, Chief Executive Officer.

“We also expanded our presence geographically with the acquisition of ODL Group, the third largest FX operator in the U.K. which gives us a much stronger position in Europe,” he continued. “And we are pleased to announce today that we have entered into a Memorandum of Understanding to acquire the retail FX business of GCI Capital of Japan with over 20,000 active accounts and $100 million in customer equity. We intend to merge this business with the Japanese subsidiary of ODL, which would provide FXCM with a major presence in Japan - the world’s largest retail FX market.”

“Lastly, we are pleased to have completed our initial public offering on the New York Stock Exchange in the fourth quarter. We believe that being a public company will give our customers greater comfort in trading through FXCM and further demonstrate that our agency model differentiates us from our competition.”

Consolidated Adjusted Pro Forma and U.S. GAAP Results

	Adjusted Pro Forma (thousands except per share amounts)
	Three Months Ended December 31,						Twelve Months Ended December 31,
	2010		2009		% Change		2010		2009		% Change
Total Revenues	$	96,127	$	74,629	29	%	$	360,277	$	322,730	12	%
Referring broker fees		19,685		15,841	24	%		81,365		76,628	6	%
Compensation and benefits		17,026		16,645	2	%		69,349		62,588	11	%
Other expenses		27,145		19,361	40	%		89,101		79,959	11	%
EBITDA		32,271		22,782	42	%		120,462		103,555	16	%
Depreciation and amortization		4,014		1,742	130	%		9,306		6,542	42	%
Income before income taxes		28,257		21,040	34	%		111,156		97,013	15	%
Income tax provision		10,117		7,805	30	%		41,507		35,634	16	%
Net Income		18,140		13,235	37	%		69,649		61,379	13	%
Net income attributable to non-controlling interest		-		-	-			-		-	-
Net Income Attributable to FXCM Inc.	$	18,140	$	13,235	37	%	$	69,649	$	61,379	13	%
Pro forma fully exchanged, fully diluted shares outstanding		75,300		75,300	-			75,300		75,300	-
Earnings Per Share	$	0.24	$	0.18	37	%	$	0.92	$	0.82	13	%

	U.S. GAAP (thousands except per share amounts)
	Three Months Ended December 31,						Twelve Months Ended December 31,
	2010		2009		% Change		2010		2009		% Change
Total Revenues	$	96,127	$	74,629	29	%	$	360,277	$	322,730	12	%
Referring broker fees		19,685		15,841	24	%		81,365		76,628	6	%
Compensation and benefits		23,872		16,645	43	%		76,195		62,588	22	%
Other expenses		27,145		19,361	40	%		89,101		79,959	11	%
EBITDA		25,425		22,782	12	%		113,616		103,555	10	%
Depreciation and amortization		4,014		1,742	130	%		9,306		6,542	42	%
Income before income taxes		21,411		21,040	2	%		104,310		97,013	8	%
Income tax provision		632		2,420	-74	%		4,149		10,053	-59	%
Net Income		20,779		18,620	12	%		100,161		86,960	15	%
Net income attributable to non-controlling interest		20,633		18,620	11	%		100,015		86,960	15	%
Net Income Attributable to FXCM Inc.	$	146	$	-			$	146	$	-
	December 7, 2010 through December 31, 2010
Net Income (in thousands)	$	146
Net Income per Class A Share
Basic and Diluted	$	0.01
Average Class A shares outstanding		17,319

Selected Operating Metrics

	(Unaudited)
	Three Months Ended December 31,						Twelve Months Ended December 31,
		2010		2009	% Change			2010		2009	% Change
Total trading volume ($ in billions)	$	836	$	835	0.1	%	$	3,178	$	3,504	-9	%
Total tradeable accounts		175,240		140,565	25	%		175,240		140,565	25	%
-- Standard account		118,207		86,186	37	%		118,207		86,186	37	%
-- Micro account		57,033		54,379	5	%		57,033		54,379	5	%
Total active accounts		136,427		116,919	17	%		136,427		116,919	17	%
Trading days in period		66		65				260		259
Daily average trades		317,658		313,035	1	%		315,210		347,104	-9	%
Daily average trades per active account		2.3		2.7	-15	%		2.5		3.4	-26	%
Retail trading revenue per million traded	$	100	$	80	25	%	$	100	$	83	20	%
Total customer equity ($ in millions)	$	641	$	354	81	%	$	641	$	354	81	%

Non-GAAP Financial Measures

Adjusted Pro Forma EBITDA, Adjusted Pro Forma Net Income and Adjusted Pro Forma Net Income per fully diluted share are non-GAAP financial measures. These measures do not represent and should not be considered as a substitute for net income, net income attributable to FXCM Inc. or net income per Class A share or as a substitute for cash flow from operating activities, as determined in accordance with GAAP, and our calculations thereof may not be comparable to similarly entitled measures reported by other companies. See “Adjusted Pro Forma Results” beginning on A-3 of this release for additional information regarding these non-GAAP financial measures

Declaration of Quarterly Dividend

The company also announced today that its board of directors has declared a quarterly dividend of $0.06 per share on its outstanding Class A common stock. The dividend is payable on April 8, 2011 to Class A stockholders of record at the close of business on March 25, 2011.

Conference Call

As previously announced, FXCM Inc. will host a conference call to discuss the results at 8:30 a.m. (EST) today. This conference call will be available by dialing 888-680-0879 and 617-213-4856 for international participants. The conference ID number is 41994767. A live, audio webcast, a copy of FXCM Inc.'s earnings release, results presentation and replay of this conference call will also be available at http://ir.fxcm.com/.

Disclosure Regarding Forward-Looking Statements

This earnings release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, which reflect FXCM Inc.’s current views with respect to, among other things, its operations and financial performance. You can identify these forward-looking statements by the use of words such as “outlook,” “believes,”“expects,” “potential,” “continues,” “may,” “will,” “should,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or the negative version of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. FXCM Inc. believes these factors include but are not limited to evolving legal and regulatory requirements of the FX industry, the limited operating history of the FX industry, risks related to the protection of its proprietary technology, risks related to its dependence on FX market makers, market conditions and those other risks described under “Risk Factors” in FXCM Inc.’s prospectus dated December 1, 2010, filed with the Securities and Exchange Commission in accordance with Rule 424(b) of the Securities Act on December 3, 2010, as such factors may be updated from time to time in FXCM Inc.’s annual report on Form 10-K and other SEC filings, which are accessible on the SEC’s website at sec.gov. In particular, we note that our statements regarding an acquisition by us of GCI Capital of Japan are subject to a number of risks and uncertainties, including the risks that we will simply fail to reach a definitive agreement regarding the proposed acquisition, that the terms of any such agreement will not be favorable to us and that the proposed acquisition will not be completed even if a definitive agreement is entered into.

These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this presentation and in the prospectus. FXCM Inc. undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law.

About FXCM Inc.

FXCM Inc. (NYSE: FXCM) is a global online provider of foreign exchange (forex) trading and related services to retail and institutional customers world-wide.

At the heart of FXCM's client offering is No Dealing Desk forex trading. Clients benefit from FXCM's large network of forex liquidity providers enabling FXCM to offer competitive spreads on major currency pairs. Clients have the advantage of mobile trading, one-click order execution and trading from real-time charts. FXCM's U.K. subsidiary, Forex Capital Markets Limited, also offers CFD products with no re-quote trading and allows clients to trade oil, gold, silver and stock indices along with forex on one platform. In addition, FXCM offers educational courses on forex trading and provides free news and market research through DailyFX.com.

Trading foreign exchange and CFDs on margin carries a high level of risk, and may not be suitable for all. Read full disclaimer.

ANNEX I
Schedule	Page Number
U.S. GAAP Results
Unaudited U.S. GAAP Consolidated Statements of Operations for the Three and Twelve Months Ended December 31, 2010 and 2009	A-1
Unaudited U.S. GAAP Consolidated Statements of Financial Conditions As of December 31, 2010 and 2009	A-2
Adjusted Pro Forma Results	A-3
Unaudited Adjusted Pro Forma and U.S. GAAP Consolidated Statements of Operations for the Three Months Ended December 31, 2010 and 2009	A-4
Unaudited Adjusted Pro Forma and U.S. GAAP Consolidated Statements of Operations for the Twelve Months Ended December 31, 2010 and 2009	A-5
Reconciliation of EBITDA to U.S. GAAP Net Income	A-6

FXCM Inc. Consolidated Statement of Operations (In thousands, except per share amounts) (Unaudited )
	Three Months Ended December 31,				Years Ended December 31,
		2010		2009		2010		2009
Revenues
Retail trading revenues	$	83,865	$	66,437	$	318,472	$	291,668
Institutional trading revenues		7,054		5,740		27,833		21,107
Interest Income		880		367		2,373		1,289
Other Income		4,328		2,085		11,599		8,666
Total revenues		96,127		74,629		360,277		322,730
Expenses
Referring broker fees		19,685		15,841		81,365		76,628
Compensation and benefits		23,872		16,645		76,195		62,588
Advertising and marketing		6,873		5,004		23,788		29,355
Communication and technology		7,948		6,429		27,120		24,026
General and administrative		12,285		7,903		38,077		26,453
Depreciation and amortization		4,014		1,742		9,306		6,542
Interest expense		39		25		116		125
Total expenses		74,716		53,589		255,967		225,717
Income before income taxes		21,411		21,040		104,310		97,013
Income tax provision		632		2,420		4,149		10,053
Net income		20,779		18,620		100,161		86,960
Net income attributable to non-controlling interest		20,633		18,620		100,015		86,960
Net income attributable to FXCM, Inc.	$	146	$	-	$	146	$	-
	December 7, 2010 through December 31, 2010
Net Income (in thousands)	$	146
Net Income per Class A Share
Basic and Diluted	$	0.01
Average Class A shares outstanding		17,319

A-1

FXCM Inc. Consolidated Statements of Financial Condition As of December 31, 2010 and 2009 (Amounts in thousands) (Unaudited)
	December 31, 2010		December 31, 2009
Assets
Current assets
Cash and cash equivalents	$	193,330	$	139,858
Cash and cash equivalents, held for customers		641,152		353,825
Due from brokers		125		1,581
Accounts receivables		18,324		2,892
Deferred tax asset		7,625		-
Total current assets		860,556		498,156
Deferred tax asset		90,107		480
Tax receivable		1,643		-
Office, communication and computer equipment, net		18,755		10,121
Intangible assets and goodwill, net		64,888		1,823
Other assets		12,368		7,356
Total assets	$	1,048,317	$	517,936
Liabilities and Equity
Current liabilities
Customer account liabilities	$	641,152	$	353,825
Accounts payable and accrued expenses		37,470		20,559
Due to brokers		13,314		764
Deferred tax liability - current		1,844		-
Due to related parties - pursuant to tax receivable agreement		3,817		-
Deferred revenue		6,000		6,000
Total current liabilities		703,597		381,148
Deferred tax liability		5,826
Due to related parties - pursuant to tax receivable agreement		70,419
Deferred revenue		-		6,000
Total liabilities		779,842		387,148
Commitments and Contingencies
Stockholders' equity
Class A common stock, par value $0.01 per share;		173		-
3,000,000 shares authorized, 17,319,000 and 0 shares issued
and outstanding as of December 31, 2010 and 2009, respectively
Class B common stock, par value $0.01 per share;		-		-
1,000,000 shares authorized, 100 and 0 shares issued
and outstanding as of December 31, 2010 and 2009, respectively
Additional paid-in-capital		101,956		-
Retained earnings		146		-
Accumulated other comprehensive income		27		-
Total stockholders' equity of FXCM, Inc.		102,302		-
Non-controlling interest		166,173		-
FXCM Holdings, LLC members' equity prior to reorganization				130,788
Total stockholders' equity / members' equity		268,475		130,788
Total liabilities and stockholders' equity	$	1,048,317	$	517,936

A-2

Adjusted Pro Forma Results

Throughout the discussion of FXCM Inc.’s results, information is presented on an Adjusted Pro Forma basis, which is a non-generally accepted accounting principles (“non-GAAP”) measure. Adjusted Pro Forma results begin with information prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), adjusted to exclude certain items relating to the initial public offering of FXCM Inc. and reflects the conversion of all units of FXCM Holdings, LLC for shares of Class A common stock of FXCM Inc. FXCM believes that the disclosed Adjusted Pro Forma measures and any adjustments thereto, when presented in conjunction with comparable U.S. GAAP measures, are useful to investors to compare FXCM’s results across several periods and facilitate an understanding of FXCM’s operating results. The Company uses these measures to evaluate its operating performance, as well as the performance of individual employees. These measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with U.S. GAAP. The differences between Adjusted Pro Forma and U.S. GAAP results are as follows:

1.	Assumed Exchange of Units of FXCM Holdings, LLC for FXCM Inc. Class A Shares. As a result of the exchange of FXCM Holdings units, the non-controlling interest related to these units is converted to controlling interest. The Company’s management believes that it is useful to provide the per-share effect associated with the assumed exchange of all FXCM Holdings units.
2.	Initial Public Offering Related Expense. The Company has reflected charges in relation to its initial public offering. The Company’s management believes that this adjustment results in a more meaningful comparison with prior period results.
3.	Income Taxes. FXCM was prior to the initial public offering organized as a series of limited liability companies and foreign corporations, and even following the initial public offering not all of the Company’s income is subject to corporate-level taxes. As a result, adjustments have been made to the Adjusted Pro Forma earnings to assume that the Company has adopted a conventional corporate tax structure and is taxed as a C corporation in the U.S. at the prevailing corporate rates, that all deferred tax assets relating to foreign operations are fully realizable within the structure on a consolidated basis and that adjustments for deferred tax assets related to the ultimate tax deductions for equity-based compensation awards are made directly to stockholders’ equity. This assumption is consistent with the assumption that all FXCM Holdings units are exchanged for shares of FXCM Inc. Class A common stock, as discussed in Item 1 above, as the assumed exchange would change the tax structure of the Company.

A-3

FXCM Inc. Adjusted Pro Forma Consolidated Statement of Operations (In thousands, except per share amounts) (Unaudited )
	Three Months Ended December 31,
	2010									2009
	As Reported		Adjustments				Adjusted Pro Forma			As Reported		Adjustments				Adjusted Pro Forma
Revenues
Retail trading revenues	$	83,865		-			$	83,865		$	66,437		-			$	66,437
Institutional trading revenues		7,054		-				7,054			5,740		-				5,740
Interest Income		880		-				880			367		-				367
Other Income		4,328		-				4,328			2,085		-				2,085
Total revenues		96,127		-				96,127			74,629		-				74,629
Expenses
Referring broker fees		19,685		-				19,685			15,841		-				15,841
Compensation and benefits		23,872		(6,846	)	^(1)		17,026			16,645		-				16,645
Advertising and marketing		6,873		-				6,873			5,004		-				5,004
Communication and technology		7,948		-				7,948			6,429		-				6,429
General and administrative		12,285		-				12,285			7,903		-				7,903
Depreciation and amortization		4,014		-				4,014			1,742		-				1,742
Interest expense		39		-				39			25		-				25
Total expenses		74,716		(6,846	)			67,870			53,589		-				53,589
Income before income taxes		21,411		6,846				28,257			21,040		-				21,040
Income tax provision		632		9,485		^(2)		10,117			2,420		5,385		^(2)		7,805
Net income		20,779		(2,639	)			18,140			18,620		(5,385	)			13,235
Net income attributable to non-controlling interest		20,633		(20,633	)	^(3)		-			18,620		(18,620	)	^(3)		-
Net income attributable to FXCM, Inc.	$	146	$	17,994			$	18,140		$	-	$	13,235			$	13,235
Pro Forma fully exchanged, fully diluted shares outstanding								75,300	^(4)								75,300	^(4)
Adjusted Pro Forma net income per fully exchanged, fully diluted shares outstanding							$	0.24								$	0.18
^(1) Represents the elimination of onetime charges associated with certain arrangements with a former employee and our CFO as a result of the IPO as well as the equity-based compensation associated with the IPO.
^(2) Represents an adjustment to reflect the assumed effective corporate tax rate of approximately 35.8% and 37.1% for the three months ended December 31, 2010 and 2009, respectively, which includes a provision for U.S. federal income taxes and assumes the highest statutory rates apportioned to each state, local and/or foreign jurisdiction. The adjustment assumes full exchange of existing unitholders membership units of Class B common stock of the Company into Class A common stock of the Company.
^(3) Represents the elimination of the non-controlling interest associates with the ownership by existing unitholders of FXCM Holdings, LLC (excluding FXCM, Inc.), as if the unitholders had fully exchanged their membership units and Class B common stock of the Company for shares of Class A common stock of the Company.
^(4) Fully diluted shares assuming all unitholders had fully exchanged their membership units and Class B common stock of the Company for shares of Class A common stock of the Company.

A-4

FXCM Inc.
Adjusted Pro Forma Consolidated Statement of Operations
(In thousands, except per share amounts)
(Unaudited )
	Year Ended December 31,
	2010								2009
	As Reported		Adjustments			Adjusted Pro Forma			As Reported		Adjustments			Adjusted Pro Forma
Revenues
Retail trading revenues	$	318,472		-		$	318,472		$	291,668		-		$	291,668
Institutional trading revenues		27,833		-			27,833			21,107		-			21,107
Interest Income		2,373		-			2,373			1,289		-			1,289
Other Income		11,599		-			11,599			8,666		-			8,666
Total revenues		360,277		-			360,277			322,730		-			322,730
Expenses
Referring broker fees		81,365		-			81,365			76,628		-			76,628
Compensation and benefits		76,195		(6,846)	^(1)		69,349			62,588		-			62,588
Advertising and marketing		23,788		-			23,788			29,355		-			29,355
Communication and technology		27,120		-			27,120			24,026		-			24,026
General and administrative		38,077		-			38,077			26,453		-			26,453
Depreciation and amortization		9,306		-			9,306			6,542		-			6,542
Interest expense		116		-			116			125		-			125
Total expenses		255,967		(6,846)			249,121			225,717		-			225,717
Income before income taxes		104,310		6,846			111,156			97,013		-			97,013
Income tax provision		4,149		37,358	^(2)		41,507			10,053		25,581	^(2)		35,634
Net income		100,161		(30,512)			69,649			86,960		(25,581)			61,379
Net income attributable to non-controlling interest		100,015		(100,015)	^(3)		-			86,960		(86,960)	^(3)		-
Net income attributable to FXCM, Inc.	$	146	$	69,503		$	69,649		$	-	$	61,379		$	61,379
Pro Forma fully exchanged, fully diluted shares outstanding							75,300	^(4)							75,300	^(4)
Adjusted Pro Forma net income per fully exchanged, fully diluted shares outstanding						$	0.92							$	0.82
^(1) Represents the elimination of onetime charges associated with certain arrangements with a former employee and our CFO as a result of the IPO as well as the equity-based compensation associated with the IPO.
^(2) Represents an adjustment to reflect the assumed effective corporate tax rate of approximately 37.3% and 36.7% for the twelve months ended December 31, 2010 and 2009, respectively, which includes a provision for U.S. federal income taxes and assumes the highest statutory rates apportioned to each state, local and/or foreign jurisdiction. The adjustment assumes full exchange of existing unitholders membership units of Class B common stock of the Company into Class A common stock of the Company.
^(3) Represents the elimination of the non-controlling interest associates with the ownership by existing unitholders of FXCM Holdings, LLC (excluding FXCM, Inc.), as if the unitholders had fully exchanged their membership units and Class B common stock of the Company for shares of Class A common stock of the Company.
^(4) Fully diluted shares assuming all unitholders had fully exchanged their membership units and Class B common stock of the Company for shares of Class A common stock of the Company.

A-5

FXCM Inc.
Reconciliation of EBITDA to Net Income
(In thousands)
(Unaudited )
	Three Months Ended December 31,				Twelve Months Ended December 31,
	Adjusted Pro Forma		U.S. GAAP		Adjusted Pro Forma		U.S. GAAP
	2010	2009	2010	2009	2010	2009	2010	2009
Revenues	96,127	74,629	96,127	74,629	360,277	322,730	360,277	322,730
Net income attributable to FXCM Inc.	18,140	13,235	146	-	69,649	61,379	146	-
Net income attributable to noncontrolling interest	-	-	20,633	18,620	-	-	100,015	86,960
Provision for income taxes	10,117	7,805	632	2,420	41,507	35,634	4,149	10,053
Depreciation and amortization	4,014	1,742	4,014	1,742	9,306	6,542	9,306	6,542
EBITDA	32,271	22,782	25,425	22,782	120,462	103,555	113,616	103,555

A-6