8-K

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) April 10, 2008

FCStone Group, Inc.

(Exact name of registrant as specified in its charter)

Delaware	001-33363	42-1091210
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification Number)

10330 NW Prairie View Road, Kansas City, Missouri 64153

(Address of principal executive offices) (Zip Code)

(800) 255- 6381

Registrant’s telephone number, including area code

(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:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition.

On April 10, 2008, FCStone Group, Inc. (the “Company”) announced its results of operations and financial condition for the quarter ended February 29, 2008. The public announcement was made by means of a press release, the text of which is set forth in Exhibit 99.1 hereto.

The information in this Item of this current report on Form 8-K, including the exhibit, is being furnished and shall not be deemed “filed” for the purposes of or otherwise subject to liabilities under Section 18 of the Securities Exchange Act of 1934, as amended, and shall not be deemed to be incorporated by reference into the filings of the registrant under the Securities Act of 1933, as amended.

Item 9.01 Financial Statements and Exhibits.

Number	Description
99.1	Press Release, dated April 10, 2008

2

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.

	FCSTONE GROUP, INC.
Dated: April 10, 2008
	By:	/s/ William J. Dunaway
		William J. Dunaway
		Chief Financial Officer

3

INDEX TO EXHIBITS

Exhibit No.	Description
99.1	Press Release, dated April 10, 2008

4

EX-99.1

Exhibit 99.1

Investor Inquiries:

Bill Dunaway, 816-457-6246

billd@fcstone.com

FCStone Group, Inc. Reports Record Second Quarter Revenues

Kansas City, Mo, April 10, 2008 – FCStone Group, Inc. (NASDAQ: FCSX), a commodity risk management firm, today announced record quarterly revenues and net income from continuing operations for its second fiscal quarter ending February 29, 2008.

Second Quarter Results

Revenues, net of cost of commodities sold, a non-GAAP financial measure, were $91.2 million in the three months ended February 29, 2008, compared to $60.1 million in the prior year quarter, an increase of 52%. Net income increased to $12.1 million, or $0.42 per diluted share, for the second quarter, compared to $6.9 million, or $0.32 per diluted share, in the prior year quarter.

Net income from continuing operations increased to $17.8 million, or $0.61 per diluted share for the second quarter, compared to $7.0 million, or $0.32 per diluted share, in the prior year quarter.

The following table presents results on a total and per share basis.

Financial Highlights

(In thousands, except per share amounts)

	Three Months Ended					Six Months Ended
	Feb. 28, 2007		Feb. 29, 2008			Feb. 28, 2007		Feb. 29, 2008
NON GAAP-Revenues, net of cost of commodities sold (1)	$	60,157	$	91,212		$	117,534	$	164,846
Income from continuing operations before income tax expense (1)	$	11,104	$	28,489		$	21,247	$	49,570
Net income from continuing operations (2)	$	6,979	$	17,789		$	13,322	$	30,920
Loss from discontinued operations, net of tax	$	59	$	5,673		$	88	$	5,719
Net income (2)	$	6,920	$	12,116		$	13,234	$	25,201
Diluted weighted average shares outstanding (1)		21,800		29,104			21,800		28,940
Diluted earnings per share, continuing operations	$	0.32	$	0.61		$	0.61	$	1.07
Diluted earnings (loss) per share, discontinued operations		—		(0.19	)		—		(0.20	)
Diluted earnings per share	$	0.32	$	0.42		$	0.61	$	0.87

(1) Amounts for the six months ended February 29, 2008 include a net amount of $2.9 million for special or one-time items, which include a $0.5 million gain on the sale of Chicago Board Option Exchange (CBOE) trading rights and a $2.4 million gain on the sale of CME common stock.

(2) Amounts for the six months ended February 29, 2008 include after tax effect of the items noted in (1) above of approximately $1.8 million.

The increase in second quarter revenues, net of cost of commodities sold, from the prior year second quarter, was driven by significantly higher exchange traded and over-the-counter (OTC) volumes. This growth was primarily related to continued volatility in the grain, energy, metals, and soft commodity markets and higher OTC volumes from our energy, renewable fuels and Brazilian customers. Additionally, these volumes along with increased margin requirements have driven higher interest income from additional investable segregated and OTC customer margin funds.

Costs and expenses, exclusive of cost of commodities sold, were higher compared to the prior year primarily due to higher volume-related costs of broker commissions and pit brokerage and clearing fees.

During the three months ended February 29, 2008, the Company undertook extensive engineering design and production tests related to the manufacturing of biodiesel at Green Diesel’s developmental stage plant in Houston, Texas. Based on the testing results, current industry economic conditions and additional capital required to complete the project, it was decided to cease construction and development of the biodiesel facility and pursue an immediate sale of the plant assets and inventory. In connection with the plan of disposal, it was determined that the carrying value of the underlying plant asset exceeded its fair value. Consequently, an impairment loss of $10.8 million was recorded, of which $2.2 million was allocated to the unaffiliated third party minority interest holder. The impairment loss is included in loss on discontinued operations, net of tax, reflected during the three months ended February 29, 2008.

“Despite a tough macroeconomic environment, FCStone continued along the path of steady revenue and earnings growth during our second fiscal quarter,” said Pete Anderson, President and Chief Executive Officer of FCStone. “This growth across all market segments of the Company is being driven by unprecedented volatility in virtually every commodity and financial market around the world. During a period of tightening credit access, this has fostered an atmosphere which has increased the necessity to manage volatility through conservative risk management services, products, platforms and structures offered by FCStone.”

Year-To-Date Results

Revenues, net of cost of commodities sold, a non-GAAP financial measure, were $164.8 million for the first six months of fiscal year 2008, compared to $117.5 million during the same period of fiscal year 2007, an increase of 40%. Net income increased 90% to $25.2 million for the first six months of fiscal year 2008, or $0.87 per diluted share, compared to $13.2 million, or $0.61 per diluted share during the same period of fiscal year 2007.

Net income from continuing operations increased to $30.9 million, or $1.07 per diluted share for the first six months of fiscal year 2008, compared to $13.3 million, or $0.61 per diluted share during the same period of fiscal year 2007.

“In addition to driving strong growth in our traditional market segments of agriculture and energy, FCStone continues to address new and developing products as well as additional industries that have growth potential,” said Bill Dunaway, Chief Financial Officer. “We have created a new Cotton and Textile Division through the acquisition of Globecot, Inc. and The Jernigan Group, LLC. This is a highly complementary business which will provide expertise in the global cotton and textile segment for both current and potential FCStone customers around the world. This deal, along with the recently completed Downes O’Neill LLC acquisition, exemplifies a continued commitment to our stated acquisition growth strategy.”

Operating Segments

FCStone’s income (loss) from continuing operations before minority interest and income tax expense by segment and certain other data are outlined below for the periods noted.

	Three Months Ended						Six Months Ended
	Feb. 28, 2007			Feb. 29, 2008			Feb. 28, 2007			Feb. 29, 2008
	($ in thousands)
Segment Data:
Income (loss) from continuing operations before minority interest and income tax expense:
Commodity and Risk Management Services (1).	$	9,153		$	21,764		$	16,717		$	38,927
Clearing and Execution Services		3,431			8,656			7,040			13,812
Financial Services		419			471			447			527
Grain Merchandising		340			—			1,460			—
Corporate		(2,137	)		(2,402	)		(3,979	)		(3,696	)
	$	11,206		$	28,489		$	21,685		$	49,570
Other Data:
EBITDA (1)	$	15,798		$	30,674		$	28,616		$	53,312
Exchange contract trading volume (in millions)		12.9			27.2			26.3			50.5
Customer Segregated Assets, end of period	$	861,780		$	1,452,861		$	861,780		$	1,452,861

(1) Amounts for the six months ended February 29, 2008 include the special or one-time items of a $2.4 million gain from the sale of CME stock and a $0.5 million gain on the sale of CBOE trading rights included in the Commodity and Risk Management Services segment.

In the Commodity and Risk Management Services segment, revenues, net of cost of commodities sold, were $46.5 million in the second quarter ended February 29, 2008, compared to $27.3 million in the prior year quarter, an increase of 70%. Segment income before minority interest and income tax for the second quarter 2008 increased to $21.8 million, compared to $9.2 million in the prior year quarter.

For the Clearing and Execution Services segment, revenues, net of cost of commodities sold, were $40.9 million in the second quarter ended February 29, 2008, compared to $24.3 million in the prior year quarter, an increase of 69%. The segment made $8.7 million in the second quarter, compared to a net income of $3.4 million in the prior year quarter.

The Financial Services segment reported revenues, net of cost of commodities sold, of $3.5 million in the second quarter ended February 29, 2008, compared to $3.4 million in the prior year quarter, an increase of 3%. Segment income increased to $471 thousand for the second quarter, compared to $419 thousand in the prior year quarter.

As previously announced on June 1, 2007, the Company sold a portion of its stake in the Grain Merchandising segment business and retains a 25% minority interest in this business instead of the previous 70% majority interest. Therefore, such business is no longer consolidated in our financial statements. Our 25% share of FGDI’s income is accounted for under the equity method, and included in the Corporate and Other segment and amounted to $0.6 million for the three months ended February 29, 2008 and $1.9 million for the six months ended February 29, 2008.

Business Outlook

Commenting on the Company’s year to date results and expectations, Anderson said, “FCStone historically has prided itself in being an innovator in the risk management industry, making substantial investments to develop specific programs, products and market segments for the benefit of our clientele and the Company. The most recent example of this innovation is our direct investment in Agora-X, in which we are partnering with NASDAQ to create a new electronic communications platform to provide liquidity, transparency and trading efficiency for FCStone, our clients, and other qualified institutional participants. We believe that this traditional commitment to our clients’ best interest, combined with the strength of the FCStone consultants’ experience and expertise, our alternative platforms to manage our clients’ risk, and the unprecedented volatility in the agriculture and energy markets will continue to drive the growth and development of FCStone.”

Conference Call & Web Cast

A conference call will be held today, Thursday, April 10, 2008 at 11:00 a.m. (ET). A live web cast of the conference call as well as a replay will be available online on the Company’s corporate web site at http://www.fcstone.com. Participants can also access the call by dialing 800-257-7087 (within the United States and Canada), or 303-262-2053 (international callers). A replay of the call will be available approximately two hours after the call has ended and will be available until 11:59 p.m. (CT) on Monday, April 28, 2008. To access the replay, dial 800-405-2236 (within the United States and Canada), or 303-590-3000 (international callers) and enter the conference ID number: 11111811#.

About FCStone Group, Inc.

FCStone Group, Inc., along with its affiliates, is an integrated commodity risk management company providing risk management consulting and transaction execution services to commercial commodity intermediaries, end-users and producers. The firm assists primarily middle market customers in optimizing their profit margins and mitigating exposure to commodity price risk. In addition to risk management consulting services, FCStone, LLC, operates one of the leading independent clearing and execution platforms for exchange-traded futures and options contracts. FCStone Group, Inc., serves more than 7,500 customers and in the 12 months ended February 29, 2008, executed 86.3 million derivative contracts in the exchange-traded and over-the-counter markets. The FCStone Group companies work in all the major commodity areas including agriculture, energy, renewable fuels, foods, forestry, cotton and textile, dairy and currency exchange. Headquartered in the Midwest, it has offices located throughout the world and is a clearing member of all major North American Futures exchanges. FCStone Group, Inc., trades on the NASDAQ Global Select Market under the symbol “FCSX.”

Forward Looking Statements

This press release may include forward-looking statements regarding, among other things, our plans, strategies and prospects, both business and financial. All statements other than statements of current or historical fact contained in this press release are forward-looking statements. The words “believe,” “expect,” “anticipate,” “should,” “plan,” “will,” “may,” “could,” “intend,” “estimate,” “predict,” “potential,” “continue” or the negative of these terms and similar expressions, as they relate to FCStone Group, Inc., are intended to identify forward-looking statements.

We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. They can be affected by inaccurate assumptions, including the risks, uncertainties and assumptions described in the Company’s filings with the Securities and Exchange Commission. In light of these risks, uncertainties and assumptions, the forward-looking statements in this press release may not occur and actual results could differ materially from those anticipated or implied in the forward-looking statements. When you consider these forward-looking statements, you should keep in mind these risk factors and other cautionary statements in this press release.

Our forward-looking statements speak only as of the date of this press release. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Use of NON-GAAP Financial Information

In this press release we disclose “revenues, net of cost of commodities sold”, and “EBITDA”, both of which are non-GAAP financial measures. For purposes of Regulation G, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position, or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure, calculated and prepared in accordance with generally accepted accounting principles in the United Sates (GAAP). Revenues, net of cost of commodities sold, is not a substitute for the GAAP measure of total revenues. EBITDA is not a substitute for the GAAP measure of net income or cash flows. Such non-GAAP financial measures are reconciled to its closest

GAAP measure, in accordance with the Securities and Exchange Commission rules, and are included in the attached supplemental data. Management believes that these non-GAAP financial measures are useful to both management and its stockholders in their analysis of the company’s business and operating performance.

Financial Statements to Follow

FCSTONE GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(in thousands, except per share amounts)

	Three Months Ended				Six Months Ended
	February 28, 2007		February 29, 2008		February 28, 2007		February 29, 2008
Revenues:
Commissions and clearing fees	$	33,353	$	46,068	$	66,256	$	85,450
Service, consulting and brokerage fees		9,314		23,728		18,409		40,002
Interest		10,729		18,858		19,127		32,239
Other		1,013		2,038		1,534		6,635
Sales of commodities		349,098		1,350		797,886		1,350
Total revenues		403,507		92,042		903,212		165,676
Costs and expenses:
Cost of commodities sold		343,350		830		785,678		830
Employee compensation and broker commissions		11,364		15,197		23,155		28,444
Pit brokerage and clearing fees		14,678		25,392		29,542		46,177
Introducing broker commissions		9,007		8,747		16.376		16,075
Employee benefits and payroll taxes		2,722		2,913		5,369		5,930
Interest		4,251		1,809		6,490		3,010
Depreciation		443		376		879		732
Bad debt expense		120		109		1,540		184
Other expenses		6,366		8,180		12,498		14,724
Total costs and expenses		392,301		63,553		881,527		116,106
Income from continuing operations before income tax expense and minority interest		11,206		28,489		21,685		49,570
Minority interest		102		—		438		—
Income from continuing operations before income tax expense		11,104		28,489		21,247		49,570
Income tax expense		4,125		10,700		7,925		18,650
Net income from continuing operations		6,979		17,789		13,322		30,920
Loss from discontinued operations, net of tax		59		5,673		88		5,719
Net income	$	6,920	$	12,116	$	13,234	$	25,201

	Three Months Ended					Six Months Ended
	February 28, 2007		February 29, 2008			February 28, 2007		February 29, 2008
Basic shares outstanding		21,800		27,709			21,800		27,565
Diluted shares outstanding		21,800		29,104			21,800		28,940
Basic earnings (loss) per share:
Continuing operations	$	0.32	$	0.64		$	0.61	$	1.12
Discontinued operations		—		(0.20	)		—		(0.21	)
Net income	$	0.32	$	0.44		$	0.61	$	0.91
Diluted earnings (loss) per share:
Continuing operations	$	0.32	$	0.61		$	0.61	$	1.07
Discontinued operations		—		(0.19	)		—		(0.20	)
Net income	$	0.32	$	0.42		$	0.61	$	0.87

(1) On June 1, 2007 the Company sold a majority interest in FGDI, LLC, which represented our entire Grain Merchandising segment. Subsequent to such sale, the company retained a 25% interest in FGDI, LLC which is now accounted for on the equity method and included in other revenues. In the six months ended February 28, 2007, sales of commodities, included $779.2 million from FGDI, LLC.

FCSTONE GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

(in thousands, except share amounts)

	August 31, 2007		February 29, 2008
			(Unaudited)
ASSETS
Cash and cash equivalents:
Unrestricted	$	90,053	$	60,774
Segregated		14,250		56,109
Commodity deposits and receivables:
Commodity exchanges and clearing organizations—customer segregated		686, 441		1,198,933
Proprietary commodity accounts		77,690		159,013
Receivables from customers, net of allowance for doubtful accounts		16,868		26,396
Total commodity deposits and receivables		780,999		1,384,342
Marketable securities, at fair value—customer segregated and other		307,828		265,931
Counterparty deposits and trade accounts receivable, net of allowance for doubtful accounts		20,746		83,886
Open contracts receivable		120,219		393,375
Notes receivable and advances		49,291		149,698
Exchange memberships and stock		10,366		7,410
Plant, equipment, furniture, software and improvements, net of accumulated depreciation		4,763		6,819
Assets held for sale		—		7,836
Other assets		21,679		41,749
Total assets	$	1,420,194	$	2,457,929
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities:
Commodity and customer regulated accounts payable	$	935,515	$	1,412,721
Trade accounts payable and advances		115,145		255,921
Open contracts payable		121,101		396,686
Accrued expenses		38,632		44,085
Notes payable and repurchase obligations		35,133		142,173
Subordinated debt		1,000		1,000

	August 31, 2007			February 29, 2008
				(Unaudited)
Total liabilities		1,246,526			2,252,586
Minority interest		—			—
Stockholders’ equity:
Common stock, $0.0001 par value, authorized 40,000,000 at August 31, 2007 and February 29, 2008, respectively; issued and outstanding 27,416,567 and 27,792,140 shares at August 31, 2007 and February 29, 2008, respectively		104,267			106,332
Additional paid-in capital		1,115			7,249
Treasury stock		(376	)		(387	)
Accumulated other comprehensive loss		(3,620	)		(5,042	)
Retained earnings		72,282			97,191
Total stockholders’ equity		173,668			205,343
Commitments and contingencies
Total liabilities and stockholders’ equity	$	1,420,194		$	2,457,929

FCSTONE GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(in thousands)

	Six Months Ended
	February 28, 2007			February 29, 2008
Cash flows from operating activities:
Net income	$	13,234		$	25,201
Plus: Loss from discontinued operations		88			5,719
Income from continuing operations		13,322			30,920
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation		879			732
Amortization of discount on note receivable		(28	)		(9	)
Loss on cancellation of warrants		—			110
Gain on sale of exchange memberships and stock		(100	)		(2,930	)
Gain on sale of other assets		—			(520	)
Stock compensation		—			753
Equity in earnings of affiliates, net of distributions		45			(1,398	)
Minority interest		438			—
Excess tax benefit of stock option exercises		—			(5,381	)
Change in commodity accounts receivable/payable, marketable securities and customer segregated funds, net		6,231			(126,099	)
Change in open contracts receivable/payable, net		(43,513	)		2,429
(Increase) decrease in trade accounts receivable and advances on grain		(3,028	)		525
Increase in counterparty deposits and accounts receivable		(9,875	)		(63,665	)
Increase in other assets		(32,452	)		(7,511	)
(Decrease) increase in trade accounts payable and advances		(10,722	)		141,196
(Decrease) increase in accrued expenses		(2,522	)		7,753
Net cash used in operating activities	$	(81,325	)		(23,095	)
Cash flows from investing activities:
Additions to furniture, equipment, software and improvements		(1,054	)		(2,788	)
Acquisitions of businesses		—			(6,725	)
Issuance of notes receivable, net		(79,760	)		(93,390	)
Proceeds from the sale of exchange memberships and stock		378			3,498

	Six Months Ended
	February 28, 2007			February 29, 2008
Purchase of exchange memberships and stock		(1,430	)		—
Proceeds from the sale of other intangible assets		—			1,350
Purchase of other intangible assets		—			(1,049	)
Net cash used in investing activities		(81,866	)		(99,104	)
Cash flows from financing activities:
Increase in checks written in excess of bank balance		(866	)		—
Proceeds from note payable, net		151,162			86,018
Proceeds from exercises of stock options		—			2,065
Excess tax benefit of stock option exercises		—			5,381
Treasury stock acquired		—			(11	)
Dividends paid		(6,057	)		—
Payments under capital lease		(275	)		—
Proceeds from subordinated debt		8,000			—
Monies released from escrow		2,526			—
Monies deposited in escrow		(33	)		—
Net cash provided by financing activities		154,457			93,453
Cash flows used for discontinued operations:
Net cash from operating activities		—			1,178
Net cash used in investing activities		—			(1,711	)
Net cash provided by financing activities		—			—
Net cash used for discontinued operations		—			(533	)
Net decrease in cash and cash equivalents – unrestricted		(8,734	)		(29,279	)
Cash and cash equivalents – unrestricted – beginning of period		59,726			90,053
Cash and cash equivalents – unrestricted – end of period	$	50,992		$	60,774
Supplemental disclosures of cash flow information:
Interest paid	$	5,473		$	2,985
Income taxes paid	$	8,594		$	13,614

Non-GAAP Financial Measures

The following table reconciles revenues, net of cost of commodities sold, with our total revenues.

	Three Months Ended				Six Months Ended
	February 28, 2007		February 29, 2008		February 28, 2007		February 29, 2008
	($ in thousands)
Revenues:
Commissions and clearing fees	$	33,353	$	46,068	$	66,256	$	85,450
Service, consulting and brokerage fees		9,314		23,728		18,409		40,002
Interest		10,729		18,858		19,127		32,239
Other		1,013		2,038		1,534		6,635
Sales of commodities		349,098		1,350		797,886		1,350
Total revenues		403,507		92,042		903,212		165,676
Less: Cost of commodities sold		343,350		830		785,678		830
Revenues, net of cost of commodities sold	$	60,157	$	91,212	$	117,534	$	164,846

The following table reconciles EBITDA with our net income.

	Three Months Ended				Six Months Ended
	February 28, 2007		February 29, 2008		February 28, 2007		February 29, 2008
	($ in thousands)
Net income:	$	6,920	$	12,116	$	13,234	$	25,201
Plus: interest expense		4,251		1,809		6,490		3,010
Plus: depreciation and amortization		443		376		879		732
Plus: income tax expense		4,125		10,700		7,925		18,650
Plus: loss on discontinued operations, net of tax		59		5,673		88		5,719
EBITDA	$	15,798	$	30,674	$	28,616	$	53,312

Commodity and Risk Management Services Segment:

The following table provides the financial performance for this segment.

	Three Months Ended February 29,				Six Months Ended February 29,
	2007		2008		2007		2008
	($ in thousands)
Sales of commodities	$	—	$	1,350	$	2,542	$	1,350
Cost of commodities sold		—		830		2,460		830
Gross profit on commodities sold		—		520		82		520
Commissions and clearing fees		13,021		14,420		25,939		26,317
Service, consulting and brokerage fees		9,458		23,857		18,675		40,207
Interest		4,742		7,532		8,388		13,648
Other revenues (1)		51		166		106		3,079
Revenues, net of cost of commodities sold		27,272		46,495		53,190		83,771
Other costs and expenses:
Expenses (excluding interest expense)		18,051		24,677		36,276		44,787
Interest expense		68		54		197		57
Total costs and expenses (excluding cost of commodities sold)		18,119		24,731		36,473		44,844
Segment income before minority interest and income taxes (1)	$	9,153	$	21,764	$	16,717	$	38,927
Exchange contract trading volume (millions)		0.6		0.9		1.5		1.6
OTC Contract volume		160,839		370,337		286,244		671,595

(1) Amounts for the six months ended February 29, 2008, includes $2.9 million from the combined gain on the sale of CME stock and CBOE trading rights.

Clearing and Execution Segment:

The following table provides the financial performance for this segment.

	Three Months Ended February 29,				Six Months Ended February 29,
	2007		2008		2007		2008
	($ in thousands)
Sales of commodities	$	—	$	—	$	—	$	—
Cost of commodities sold		—		—		—		—
Gross profit on commodities sold		—		—		—		—
Commissions and clearing fees		20,509		31,984		40,699		59,652
Service, consulting and brokerage fees		—		—		—		—
Interest		3,654		8,964		7,485		14,334
Other revenues (1)		100		—		100		—
Revenues, net of cost of commodities sold		24,263		40,948		48,284		73,986
Other costs and expenses:
Expenses (excluding interest expense)		20,506		32,272		40,780		60,133
Interest expense		326		20		464		41
Total costs and expenses (excluding cost of commodities sold)		20,832		32,292		41,244		60,174
Segment income before minority interest and income taxes (1)	$	3,431	$	8,656	$	7,040	$	13,812
Exchange contract trading volume (millions)		12.3		26.3		24.8		48.9

Financial Services Segment:

The following table provides the financial performance for this segment.

	Three Months Ended February 29,				Six Months Ended February 29,
	2007		2008		2007		2008
	($ in thousands)
Sales of commodities	$	9,599	$	—	$	16,157	$	—
Cost of commodities sold		9,539		—		16,069		—
Gross profit on commodities sold		60		—		88		—
Commissions and clearing fees		—		—		—		—
Service, consulting and brokerage fees		—		—		—		—
Interest		2,971		2,318		4,158		3,900
Other revenues		360		1,184		682		1,566
Revenues, net of cost of commodities sold		3,391		3,502		4,928		5,466
Other costs and expenses:
Expenses (excluding interest expense)		546		1,255		1,079		1,904
Interest expense		2,426		1,776		3,402		3,035
Total costs and expenses (excluding cost of commodities sold)		2,972		3,031		4,481		4,939
Segment income (loss) before minority interest and income taxes	$	419	$	471	$	447	$	527

Grain Merchandising Segment:

The following table provides the financial performance for this segment.

	Three Months Ended February 29,				Six Months Ended February 29,
	2007		2008		2007		2008
	($ in thousands)
Sales of commodities	$	339,499	$	—	$	779,187	$	—
Cost of commodities sold		333,950		—		767,462		—
Gross profit on commodities sold		5,549		—		11,725		—
Commissions and clearing fees		—		—		—		—
Service, consulting and brokerage fees		—		—		—		—
Interest		29		—		64		—
Other revenues		467		—		612		—
Revenues, net of cost of commodities sold		6,045		—		12,401		—
Other costs and expenses:
Expenses (excluding interest expense)		3,765		—		7,795		—
Interest expense		1,940		—		3,146		—
Total costs and expenses (excluding cost of commodities sold)		5,705		—		10,941		—
Segment income before minority interest and income taxes	$	340	$	—	$	1,460	$	—

(1) On June 1, 2007 the Company sold a majority interest in FGDI, LLC, which represented our entire Grain Merchandising segment. Subsequent to such sale, the company retained a 25% interest in FGDI, LLC which is now accounted for under the equity method and included in the Corporate and Other segment.

Quarterly Financial Highlights:

The following table provides summary financial highlights

by quarter for fiscal year 2008.

	Three Months Ended
	November 30, 2007		February 29, 2008
	($ in thousands)
NON GAAP-Revenues, net of cost of commodities sold	$	73,634	$	91,212
Income from continuing operations before income tax expense (1)	$	21,081	$	28,489
Net income from continuing operations (1)	$	13,131	$	17,789
Loss from discontinued operations, net of tax	$	46	$	5,673
Net income (1)	$	13,085	$	12,116

(1) The three months ended November 30, 2007 included a pre-tax gain on the sale of CME stock of $2.4 million and a pre-tax gain of $0.5 million on the sale of CBOE trading rights. Without these items our first quarter income from continuing operations before income tax expense would have been $18.2 million, net income from continuing operations would have been $11.5 million and net income would have been $11.4 million.