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BGC Partners Updates Its Outlook for the Second Quarter of 2014

 NEW YORK, June 26, 2014 /CNW/ -- BGC Partners, Inc. (NASDAQ:  BGCP) ("BGC  Partners," "BGC," or "the Company"), a leading global brokerage company  servicing the financial and real estate markets, today announced that it has  updated its outlook for the second quarter of 2014.  http://photos.prnewswire.com/prnvar/20110720/MM38935LOGO  The Company expects its financial results for the quarter ending June 30, 2014  to be around the mid-point of the range of its previously stated guidance for  revenues and earnings.  BGC's second quarter outlook was originally published  in a press release dated May 1, 2014 as follows:  Second Quarter 2014 Outlook Compared with Second Quarter 2013 Results  *   The Company expected to generate distributable earnings revenues of  between approximately $420 million and $440 million compared with $471.1  million.  The year earlier figure was approximately $447 million, excluding  eSpeed.(1 )*   BGC anticipated pre-tax distributable earnings to be between  approximately $47 million and $55 million versus $53.8 million. The prior  period amount was approximately $40 million, excluding eSpeed. *   The Company  expected its effective tax rate for distributable earnings to be around 15  percent, compared with 14.5 percent.(2)  This guidance did not include any revenues or earnings from the planned  acquisition of Cornish & Carey Commercial, which is expected to close in the  middle of 2014.  BGC intends to report its second quarter financial results  before the market open on July 31, 2014.  Further details regarding this  announcement and the related conference call will be forthcoming.  Distributable Earnings Defined BGC Partners uses non-GAAP financial measures  including "revenues for distributable earnings," "pre-tax distributable  earnings" and "post-tax distributable earnings," which are supplemental  measures of operating performance that are used by management to evaluate the  financial performance of the Company and its subsidiaries. BGC Partners  believes that distributable earnings best reflect the operating earnings  generated by the Company on a consolidated basis and are the earnings which  management considers available for distribution to BGC Partners, Inc. and its  common stockholders, as well as to holders of BGC Holdings partnership units  during any period.  As compared with "income (loss) from operations before income taxes," "net  income (loss) for fully diluted shares," and "fully diluted earnings (loss)  per share," all prepared in accordance with GAAP, distributable earnings  calculations primarily exclude certain non-cash compensation and other  expenses which generally do not involve the receipt or outlay of cash by the  Company, which do not dilute existing stockholders, and which do not have  economic consequences, as described below.  In addition, distributable  earnings calculations exclude certain gains and charges that management  believes do not best reflect the ordinary operating results of BGC.  Revenues for distributable earnings are defined as GAAP revenues excluding the  impact of BGC Partners, Inc.'s non-cash earnings or losses related to its  equity investments, such as in Aqua Securities, L.P. and ELX Futures, L.P.,  and its holding company general partner, ELX Futures Holdings LLC.  Revenues  for distributable earnings include the collection of receivables which would  have been recognized for GAAP other than for the effect of acquisition  accounting.  Revenues for distributable earnings also exclude certain one-time  or unusual gains that are recognized under GAAP, because the Company does not  believe such gains are reflective of its ongoing, ordinary operations.  Pre-tax distributable earnings are defined as GAAP income (loss) from  operations before income taxes excluding items that are primarily non-cash,  non-dilutive, and non-economic, such as:  *  Non-cash stock-based equity compensation charges for REUs granted or issued  prior to the merger of BGC Partners, Inc. with and into eSpeed, as well as  post-merger non-cash, non-dilutive equity-based compensation related to  partnership unit exchange or conversion. *  Allocations of net income to  founding/working partner and other limited partnership units, including REUs,  RPUs, PSUs, LPUs, and PSIs. *  Non-cash asset impairment charges, if any.  Distributable earnings calculations also exclude charges related to purchases,  cancellations or redemptions of partnership interests and certain unusual,  one-time or non-recurring items, if any.  "Compensation and employee benefits" expense for distributable earnings will  also include broker commission payouts relating to the aforementioned  collection of receivables.  BGC's definition of distributable earnings also excludes certain gains and  charges with respect to acquisitions, dispositions, or resolutions of  litigation. This exclusion pertains to the one-time gain related to the NASDAQ  OMX transaction.  Management believes that excluding these gains and charges  best reflects the operating performance of BGC. However, because NASDAQ OMX is  expected to pay BGC in an equal amount of stock on a regular basis for 15  years as part of the transaction, the payments associated with BGC's receipt  of such stock are expected to be included in the Company's calculation of  distributable earnings.  To make quarter-to-quarter comparisons more  meaningful, one-quarter of the annual contingent earn-out amount will be  included in the Company's calculation of distributable earnings each quarter  as "other revenues."  Since distributable earnings are calculated on a pre-tax basis, management  intends to also report "post-tax distributable earnings" and "post-tax  distributable earnings per fully diluted share":  *  "Post-tax distributable earnings" are defined as pre-tax distributable  earnings adjusted to assume that all pre-tax distributable earnings were taxed  at the same effective rate. *  "Post-tax distributable earnings per fully  diluted share" are defined as post-tax distributable earnings divided by the  weighted-average number of fully diluted shares for the period.  BGC's distributable earnings per share calculations assume either that:  *  The fully diluted share count includes the shares related to the dilutive  instruments, such as the Convertible Senior Notes, but excludes the associated  interest expense, net of tax, when the impact would be dilutive; or *  The  fully diluted share count excludes the shares related to these instruments,  but includes the associated interest expense, net of tax.  Each quarter, the dividend to common stockholders is expected to be determined  by the Company's Board of Directors with reference to post-tax distributable  earnings per fully diluted share.  In addition to the Company's quarterly  dividend to common stockholders, BGC Partners expects to pay a pro-rata  distribution of net income to BGC Holdings founding/working partner and other  limited partnership units, including REUs, RPUs, LPUs, PSUs and PSIs, and to  Cantor for its noncontrolling interest. The amount of all of these payments is  expected to be determined using the above definition of pre-tax distributable  earnings per share.  Certain employees who are holders of RSUs are granted pro-rata payments  equivalent to the amount of dividends paid to common stockholders. Under GAAP,  a portion of the dividend equivalents on RSUs is required to be taken as a  compensation charge in the period paid. However, to the extent that they  represent cash payments made from the prior period's distributable earnings,  they do not dilute existing stockholders and are therefore excluded from the  calculation of distributable earnings.  Distributable earnings is not meant to be an exact measure of cash generated  by operations and available for distribution, nor should it be considered in  isolation or as an alternative to cash flow from operations or GAAP net income  (loss). The Company views distributable earnings as a metric that is not  necessarily indicative of liquidity or the cash available to fund its  operations.  Pre- and post-tax distributable earnings are not intended to replace the  Company's presentation of GAAP financial results. However, management believes  that they help provide investors with a clearer understanding of BGC Partners'  financial performance and offer useful information to both management and  investors regarding certain financial and business trends related to the  Company's financial condition and results of operations. Management believes  that distributable earnings and the GAAP measures of financial performance  should be considered together.  Management does not anticipate providing an outlook for GAAP "revenues,"  "income (loss) from operations before income taxes," "net income (loss) for  fully diluted shares," and "fully diluted earnings (loss) per share," because  the items previously identified as excluded from pre-tax distributable  earnings and post-tax distributable earnings are difficult to forecast.  Management will instead provide its outlook only as it relates to revenues for  distributable earnings, pre-tax distributable earnings and post-tax  distributable earnings.  For more information on this topic, please see the tables in the most recent  earnings release entitled "Reconciliation of Revenues Under GAAP and  Distributable Earnings," and "Reconciliation of GAAP Income to Distributable  Earnings" which provide a summary reconciliation between pre- and post-tax  distributable earnings and the corresponding GAAP measures for the Company in  the periods discussed in this document.  About BGC Partners, Inc. BGC Partners is a leading global brokerage company  servicing the financial and real estate markets.  Products include fixed  income securities, interest rate swaps, foreign exchange, equities, equity  derivatives, credit derivatives, commercial real estate, commodities, futures,  and structured products. BGC also provides a wide range of services, including  trade execution, broker-dealer services, clearing, processing, information,  and other back-office services to a broad range of financial and non-financial  institutions.  Through its BGC Trader and BGC Market Data brands, BGC offers  financial technology solutions, market data, and analytics related to numerous  financial instruments and markets.  Through the Newmark Grubb Knight Frank  brand, the Company offers a wide range of commercial real estate services  including leasing and corporate advisory, investment sales and financial  services, consulting, project and development management, and property and  facilities management. BGC's customers include many of the world's largest  banks, broker-dealers, investment banks, trading firms, hedge funds,  governments, corporations, property owners, real estate developers, and  investment firms. BGC Partners is led by Chairman and Chief Executive Officer  Howard W. Lutnick. For more information, please visit www.bgcpartners.com.  BGC, BGC Trader, Grubb & Ellis, Grubb and Newmark are trademarks and service  marks of BGC Partners, Inc. and its affiliates.  Knight Frank is a service  mark of Knight Frank Limited Corp., used with permission.  Discussion of Forward-Looking Statements by BGC Partners Statements in this  document regarding BGC Partners' business that are not historical facts are  "forward-looking statements" that involve risks and uncertainties. Except as  required by law, BGC undertakes no obligation to release any revisions to any  forward-looking statements.  For a discussion of additional risks and  uncertainties, which could cause actual results to differ from those contained  in the forward-looking statements, see BGC's Securities and Exchange  Commission filings, including, but not limited to, the risk factors set forth  in our public filings, including our most recent Form 10-K and any updates to  such risk factors contained in subsequent Form 10-Q or Form 8-K filings.  (1) On June 28, 2013, BGC sold its fully electronic trading platform for  benchmark U.S. Treasury Notes and Bonds to NASDAQ OMX Group, Inc ("NASDAQ  OMX").  For the purposes of this document, the assets sold are referred to as  "eSpeed."  (2) Investors and analysts should note that BGC's post-tax distributable  earnings per share calculations assume either that the fully diluted share  count includes the shares related to the dilutive instruments, such as the  Convertible Senior Notes, but excludes the associated interest expense when  the impact would be dilutive, or that the fully diluted share count excludes  the shares related to these instruments, but includes the associated interest  expense.  In the second quarter of 2014, the pre-tax interest expense  associated with the Convertible Senior Notes was expected to be $6.2 million  while the post-tax interest expense was expected to be $5.3 million, and the  associated weighted-average share count was expected to be 40.1 million, all  based on distributable earnings.  Logo - http://photos.prnewswire.com/prnh/20110720/MM38935LOGO    SOURCE  BGC Partners, Inc.  Media, Hannah Sloane, 212-294-7938, Sarah Laufer, 212-915-1008, Investors,  Jason McGruder, 212-829-4988, Jason Chryssicas, 212-915-1987  CO: BGC Partners, Inc. ST: New York NI: FIN REL EST ERN  
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