JERSEY CITY, N.J., Oct. 4 /PRNewswire/ -- Knight Trading Group, Inc. (Nasdaq: NITE) announced today that it will post lower than expected third quarter earnings due to a difficult market environment in the late summer and expenditures to build its international market-making capabilities. Knight has posted a Q&A to its Web site (http://www.knighttradinggroup.com) that discusses the third quarter.

Knight will release its official third quarter results on Wednesday, October 18, at 6:00 a.m. Eastern Time (ET). The Company will conduct its third quarter earnings conference call for analysts, investors and the media at 9:00 a.m. (ET) that same day.

During Knight's second quarter earnings conference call with analysts, investors and the media on July 19, the Company stated that it was comfortable with 20% to 30% growth in the third quarter 2000 versus the previous year period, less expenses related to its international expansion. Accordingly, based on Knight's third quarter 1999 earnings per share of $0.22 (including historical results of Knight Financial Products, which the Company acquired in January 2000), the Company's targeted range for third quarter 2000 earnings was $0.22 to $0.27 per share. Knight now expects to announce third quarter earnings per share in the range of $0.13 to $0.16, including the impact of approximately $0.07 per share related to expenditures for its international expansion.

"In the third quarter we saw an operating environment characterized by low volatility and recurring declines in Nasdaq," said Kenneth D. Pasternak, Chief Executive Officer and President of Knight Trading Group. "While our trading model continued to perform well regardless of market direction, the corrections in Nasdaq resulted in less trading activity by self-directed individual investors, and an adverse change in the composition of our order flow. As these investors adjusted to the correction from the first quarter's euphoria, order flow moved to less volatile, highly liquid securities. This trading environment, exacerbated by the seasonally slow third quarter, hurt our profit performance."

"Knight has the business model, the management team, and the culture to capitalize on the significant opportunities that exist in good markets, and to manage effectively in adverse markets," continued Mr. Pasternak. "We are aggressively building our international platform despite the challenging environment; we will continue to make significant investments to establish a global footprint, enhance our execution services for clients, and develop content that will drive execution decisions."

Knight is the liquidity center that offers superior execution services to its broker-dealer and institutional clients in over-the-counter (OTC) and listed equity securities, and in equity options. In so doing, Knight helps its clients meet their fiduciary obligation of obtaining best execution for the securities orders that they place on behalf of their customers. Knight also maintains an asset management business for institutional investors and high net worth individuals through Deephaven Capital Management.

Knight has the power to commit capital for market orders, and also maintains one of the largest limit order books in the OTC market. It is one of the largest destinations for stock orders placed via the Internet. Knight traded 81 billion shares in 1999, a volume behind only those posted by Nasdaq and the New York Stock Exchange (NYSE). It is a charter member of Fortune magazine's "e-50 Stock Index," an elite collection of companies shaping the Internet-based economy. Knight also is ranked by Forbes magazine as one of the 500 most profitable public companies in the U.S. Ultimately, Knight plans to enable the global trading village to trade all types of equity securities and options at anytime, from anywhere in the world. More information about Knight can be obtained at http://www.knighttradinggroup.com. SOURCE Knight Trading Group, Inc.

CONTACT: Margaret Wyrwas, Vice President, Corporate Communications & Investor Relations, 201-557-6954, mwyrwas@knight-sec.com, or Chuck Dohrenwend, Manager, Corporate Communications, 201-356-1753, chuck_dohrenwend@knight-sec.com, both of Knight Trading Group, Inc./