Instinet Group Inc. today announced higher profit for its third quarter.

The firm announced headline net income of $84 million for the third quarter of 2005, compared to $11 million for the third quarter of 2004 and $8 million for the second quarter of 2005.

However, excluding the discontinued operations of Lynch Jones & Ryan (which it sold for an after-tax gain of $90 million in the quarter), Instinet Group actually incurred a net loss of $5 million.

The third quarter 2005 results included $20 million in charges related to facility and asset write-offs, $9 million in severance charges and $6 million in merger related advisory fees, partially offset by $9 million in net investment gains. Excluding these items and the related tax effects, pro forma net income from continuing operations for the third quarter of 2005 was $11 million, compared with $5 million for the third quarter of 2004 and $6 million for the second quarter of 2005.

Total revenues for Instinet Group, net of interest, were $254 million for the third quarter of 2005, up 2% from the third quarter of 2004 and down 2% from the second quarter of 2005. Total expenses for the third quarter were $269 million, up 12% from $240 million in the third quarter of 2004 and up 9% from $246 million in the second quarter of 2005.

At September 30, total assets were approximately $1.8 billion and shareholders’ equity was approximately $1.1 billion. Instinet Group’s total headcount was 785 employees compared to 938 on June 30, 2005. Headcount at September 30, 2005 included 614 employees from Instinet, 82 employees from INET and 89 employees from Instinet Group.

Instinet Group announced on April 22, that it has entered into a definitive agreement pursuant to which Nasdaq will acquire the firm. The merger agreement was adopted by a majority of shareholders in September. It expects that the merger will be completed during the fourth quarter of 2005.