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Press Release
April 21, 2010
Printable version (PDF)
RAYMOND JAMES FINANCIAL, INC.
ANNOUNCES SECOND QUARTER RESULTS
ST. PETERSBURG, Fla. – Raymond James Financial, Inc. today reported net income of $55,628,000, or $0.45 per diluted share, for the second quarter ended March 31, 2010. In comparison, the firm earned $6,093,000, or $0.05 per diluted share, for the second quarter of fiscal 2009. Net revenues increased 26 percent to $734,439,000.
“Although the comparisons to last year’s March quarter are gratifying and, in some part, well earned, the 2009 quarter occurred during the bleakest days of the financial meltdown. Consequently, it’s not surprising that Raymond James has dramatically outperformed in this comparison. It is surprising the market’s recovery has been this rapid. On the other hand, a 10.5 percent rate of return on average equity in the quarter is still considerably below our historical average,” stated Chairman and CEO Thomas A. James.
“The more striking comparison is to the immediately preceding December quarter. Net revenues are up 7 percent and net income 30 percent. The Private Client Group, Capital Markets and Raymond James Bank all contributed to the increase. Of our four major segments, only Asset Management Group results trailed the preceding quarter due to a few annual performance fees received last quarter. Excluding the performance fees recorded in the December quarter, Asset Management revenues were up by 5 percent. In Capital Markets, while Fixed Income revenues and profits declined, Equity Capital Markets more than offset the decline.
“The Private Client Group continues to benefit from a higher financial advisor count and higher productivity. Although recruiting has slowed from the record levels of the last two years, activity has recently increased. Given the record level of client assets under administration, which are up 41 percent over last year’s level, the outlook for increasing commissions and fees is constructive,” James continued.
“Raymond James Bank also realized a significant successive quarterly improvement, as well as reversed the loss from last year’s second quarter. In contrast to our objective, total loan balances decreased by $216 million from last quarter but the pipeline is better now.
“Although we expect the trends in both the banking and the securities segments to improve as the economy recovers, one needs to be mindful that the securities markets are subject to corrections in an improving economy and the fortunes of individual borrowers can impact the bank adversely in any individual quarter.”
The company will conduct its quarterly conference call Thursday, April 22, at 8:15 a.m. ET. For a listen-only connection, visit raymondjames.com/analystcall for a live audio webcast. The subjects to be covered may include forward-looking information. Questions may be posed to management by participants on the analyst call-in line, and in response the company may disclose additional material information.
Raymond James Financial (NYSE-RJF) is a Florida-based diversified holding company providing financial services to individuals, corporations and municipalities through its subsidiary companies. Its three wholly owned broker/dealers (Raymond James & Associates, Raymond James Financial Services and Raymond James Ltd.) and Raymond James Investment Services Limited, a majority-owned independent contractor subsidiary in the United Kingdom, have a total of more than 5,300 financial advisors serving approximately 1.9 million accounts in more than 2,300 locations throughout the United States, Canada and overseas. In addition, total client assets are approximately $242 billion, of which $32 billion are managed by the firm’s asset management subsidiaries.
To the extent that Raymond James makes or publishes forward-looking statements (regarding economic conditions, management expectations, strategic objectives, business prospects, anticipated expense savings, loan reserves/losses, financial results, anticipated results of litigation and regulatory proceedings, and other similar matters), a variety of factors, many of which are beyond Raymond James’ control, could cause actual results and experiences to differ materially from the expectations and objectives expressed in these statements. These factors are described in Raymond James’ 2009 annual report on Form 10-K and the quarterly report on Form 10-Q for the quarter ended December 31, 2009, which are available on raymondjames.com and sec.gov.
Raymond James Financial, Inc.
Unaudited Report
For the three months ended
(all data in thousands, except per share earnings) |
| |
Mar 31,
2010 |
Mar 31,
2009 |
%
Change |
Dec 31,
2009 |
%
Change |
Total Revenues |
$749,987 |
$591,740* |
27% |
$702,669 |
7% |
Net Revenues |
734,439 |
584,996* |
26% |
686,967 |
7% |
Pre-Tax Income |
89,656 |
12,918 |
594% |
69,388 |
29% |
Net Income |
55,628 |
6,093 |
813% |
42,903 |
30% |
| |
Mar 31,
2010 |
Mar 31,
2009 |
%
Change |
Dec. 31,
2009 |
%
Change |
Income for basic earnings per common share**: |
|
|
|
|
|
Net income applicable to RJF, Inc. common shareholders |
$53,241 |
$5,546 |
860% |
$41,114 |
29% |
Income for diluted earnings per common share**: |
|
|
|
|
|
Net income applicable to RJF, Inc. common shareholders |
$53,245 |
$5,546 |
860% |
$41,116 |
29% |
Earnings per common share**: |
|
|
|
|
|
Basic |
$0.45 |
$0.05 |
800% |
$0.35 |
29% |
Diluted |
$0.45 |
$0.05 |
800% |
$0.35 |
29% |
Raymond James Financial, Inc.
Unaudited Report
For the six months ended
(all data in thousands, except per share earnings) |
| |
March 31,
2010 |
March 31,
2009 |
%
Change |
Income for basic earnings per common share**: |
|
|
|
Net income applicable to RJF, Inc. common shareholders |
$94,361 |
$64,472 |
46% |
Income for diluted earnings per common share**: |
|
|
|
Net income applicable to RJF, Inc. common shareholders |
$94,367 |
$64,474 |
46% |
Earnings per common share**: |
|
|
|
Basic |
$0.79 |
$0.55 |
44% |
Diluted |
$0.79 |
$0.55 |
44% |
| |
Balance Sheet Data |
| |
March
2010 |
September
2009 |
Total assets |
$15.3 bil. |
$18.2 bil.*** |
Shareholders' equity |
$2,160 mil. |
$2,032 mil. |
Book value per share |
$18.04 |
$17.11 |
| |
Management Data
Quarter Ended |
| |
March
2010 |
March
2009 |
December
2009 |
September
2009 |
Total financial advisors: |
|
|
|
|
United States |
4,750 |
4,616 |
4,755 |
4,781 |
Canada |
462 |
459 |
458 |
478 |
United Kingdom |
133 |
108 |
116 |
116 |
| |
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# Lead managed/co-managed: |
|
|
|
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Corporate public offerings in U.S. |
28 |
10 |
24 |
25 |
Corporate public offerings in Canada |
6 |
1 |
6 |
6 |
Financial Assets Under Management: |
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|
|
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Managed Accounts (excluding Money Market Funds) |
$29.3 bil. |
$19.6 bil. |
$27.6 bil. |
$25.9 bil. |
| |
|
|
|
|
Client Assets under administration |
$242 bil. |
$172 bil. |
$232 bil. |
$223 bil. |
Client Margin Balances |
$1,401 mil. |
$1,089 mil. |
$ 1,347 mil. |
$1,239 mil. |
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Three Months Ended |
| |
March 31,
2010 |
March 31,
2009 |
%
Change |
December 31,
2009 |
%
Change |
| |
(in 000’s) |
Revenues: |
|
|
|
|
|
Private Client Group |
$470,157 |
$351,042 |
34% |
$454,824 |
3% |
Capital Markets |
149,770 |
124,013 |
21% |
133,773 |
12% |
Asset Management |
48,616 |
41,510 |
17% |
49,998 |
(3%) |
RJ Bank |
71,530 |
83,336 |
(14%) |
68,922 |
4% |
Emerging Markets |
3,884 |
3,097 |
25% |
3,718 |
4% |
Stock Loan/Borrow |
2,218 |
2,607 |
(15%) |
1,875 |
18% |
Proprietary Capital |
12,683 |
(639) |
NA |
(35) |
NA |
Other |
2,038 |
298 |
584% |
1,758 |
16% |
Intersegment Eliminations |
(10,909) |
(13,524) |
19% |
(12,164) |
10% |
Total Revenues |
$ 749,987 |
$ 591,740 |
27% |
$ 702,669 |
7% |
| |
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|
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Pre-Tax Income: |
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|
|
|
|
Private Client Group |
$36,543 |
$11,681 |
213% |
$31,71 |
15% |
Capital Markets |
21,999 |
15,982 |
38% |
11,394 |
93% |
Asset Management |
11,235 |
4,904 |
129% |
12,066 |
(7%) |
RJ Bank |
30,822 |
(12,416) |
NA |
24,637 |
25% |
Emerging Markets |
(1,570) |
(2,289) |
31% |
(1,412) |
(11%) |
Stock Loan/Borrow |
646 |
847 |
(24%) |
687 |
(6%) |
Proprietary Capital |
(42) |
(502) |
92% |
(812) |
95% |
Other |
(9,977) |
(5,289) |
(89%) |
(8,884) |
(12%) |
Pre-Tax Income |
$89,656 |
$12,918 |
594% |
$69,388 |
29% |
| |
Six Months Ended |
| |
March 31,
2010 |
March 31,
2009 |
%
Change |
| |
(in 000’s) |
Revenues: |
|
|
|
Private Client Group |
$924,981 |
$765,586 |
21% |
Capital Markets |
283,543 |
252,719 |
12% |
Asset Management |
98,614 |
92,801 |
6% |
RJBank |
140,452 |
192,575 |
(27%) |
Emerging Markets |
7,602 |
7,420 |
2% |
Stock Loan/Borrow |
4,093 |
5,897 |
(31%) |
Proprietary Capital |
12,648 |
(101) |
NA |
Other |
3,796 |
1,384 |
174% |
Intersegment Eliminations |
(23,073) |
(30,708) |
25% |
Total Revenues |
$ 1,452,656 |
$ 1,287,573 |
13% |
| |
|
|
|
Pre-Tax Income: |
|
|
|
Private Client Group |
$68,255 |
$44,266 |
54% |
Capital Markets |
33,393 |
30,271 |
10% |
Asset Management |
23,301 |
13,978 |
67% |
RJBank |
55,459 |
42,210 |
31% |
Emerging Markets |
(2,982) |
(2,754) |
(8%) |
Stock Loan/Borrow |
1,333 |
2,070 |
(36%) |
Proprietary Capital |
(854) |
(1,046) |
18% |
Other |
(18,861) |
(14,413) |
(31%) |
Pre-Tax Income |
$159,044 |
$114,582 |
39% |
RAYMOND JAMES FINANCIAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME
(UNAUDITED)
Quarter-to-Date
(in thousands, except per share amounts) |
| |
Three Months Ended |
| |
March 31,
2010 |
March 31,
2009 |
%
Change |
Dec 31,
2009 |
%
Change |
Revenues: |
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|
|
|
|
Securities commissions and fees |
$479,302 |
$ 369,705 |
30% |
$ 469,151 |
2% |
Investment banking |
44,839 |
18,001 |
149% |
25,718 |
74% |
Investment advisory fees |
42,218 |
34,290 |
23% |
43,975 |
(4%) |
Interest |
93,275 |
108,073 |
(14%) |
91,372 |
2% |
Net trading profits |
10,170 |
12,766 |
(20%) |
11,637 |
(13%) |
Financial service fees |
39,286 |
30,805 |
28% |
36,782 |
7% |
Other |
40,897 |
18,100 |
126% |
24,034 |
70% |
| |
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|
|
|
|
Total Revenues |
749,987 |
591,740 |
27% |
702,669 |
7% |
Interest Expense |
15,548 |
6,744 |
131% |
15,702 |
(1%) |
Net Revenues |
734,439 |
584,996 |
26% |
686,967 |
7% |
| |
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Non-Interest Expenses: |
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|
|
Compensation, commissions and benefits |
497,419 |
391,902 |
27% |
471,079 |
6% |
Communications and information processing |
32,445 |
29,956 |
8% |
28,074 |
16% |
Occupancy and equipment costs |
25,892 |
24,945 |
4% |
26,715 |
(3%) |
Clearance and floor brokerage |
8,828 |
7,464 |
18% |
8,502 |
4% |
Business development |
20,614 |
18,817 |
10% |
19,881 |
4% |
Investment advisory fees |
9,409 |
7,222 |
30% |
9,103 |
3% |
Bank loan loss provision |
19,937 |
74,979 |
(73%) |
22,835 |
(13%) |
Other |
25,687 |
23,485 |
9% |
33,665 |
(24%) |
Total Non-Interest Expenses |
640,231 |
578,770 |
11% |
619,854 |
3% |
| |
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Income before provision for income taxes and noncontrolling interests |
94,208 |
6,226 |
1,413% |
67,113 |
40% |
Provision for income taxes |
34,028 |
6,825 |
399% |
26,485 |
28% |
Net Income (loss) before noncontrolling interests |
60,180 |
(599) |
NA |
40,628 |
48% |
Net income (loss) applicable to noncontrolling interests |
4,552 |
(6,692) |
NA |
(2,275) |
NA |
Net Income applicable to Raymond James Financial, Inc. |
$55,628 |
$6,093 |
813% |
$42,903 |
30% |
| |
|
|
|
|
|
Net Income per common share basic |
$0.45 |
$0.05 |
800% |
$0.35 |
29% |
Net Income per common share diluted |
$0.45 |
$0.05 |
800% |
$0.35 |
29% |
Weighted average common shares outstanding-basic |
119,288 |
117,134 |
|
118,763 |
|
Weighted average common and common equivalent shares outstanding-diluted |
119,580 |
117,187 |
|
118,983 |
|
RAYMOND JAMES FINANCIAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME
(UNAUDITED)
Year-to-Date
(in thousands, except per share amounts) |
| |
Six Months Ended |
| |
March 31,
2010 |
March 31,
2009 |
%
Change |
Revenues: |
|
|
|
Securities commissions and fees |
$ 948,453 |
$ 787,930 |
20% |
Investment banking |
70,557 |
38,734 |
82% |
Investment advisory fees |
86,193 |
78,725 |
9% |
Interest |
184,647 |
251,685 |
(27%) |
Net trading profits |
21,807 |
21,941 |
(1%) |
Financial service fees |
76,068 |
63,940 |
19% |
Other |
64,931 |
44,618 |
46% |
| |
|
|
|
Total Revenues |
1,452,656 |
1,287,573 |
13% |
Interest Expense |
31,250 |
38,635 |
(19%) |
Net Revenues |
1,421,406 |
1,248,938 |
14% |
| |
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|
Non-Interest Expenses: |
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|
|
Compensation, commissions and benefits |
968,498 |
811,156 |
19% |
Communications and information processing |
60,519 |
65,179 |
(7%) |
Occupancy and equipment costs |
52,607 |
51,380 |
2% |
Clearance and floor brokerage |
17,330 |
16,052 |
8% |
Business development |
40,495 |
43,541 |
(7%) |
Investment advisory fees |
18,512 |
16,944 |
9% |
Bank loan loss provision |
42,772 |
99,849 |
(57%) |
Other |
59,352 |
41,954 |
41% |
Total Non-Interest Expenses |
1,260,085 |
1,146,055 |
10% |
| |
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Income before provision for income taxes and noncontrolling interests |
161,321 |
102,883 |
57% |
Provision for income taxes |
60,513 |
47,396 |
28% |
Net Income before noncontrolling interests |
100,808 |
55,487 |
82% |
Net income (loss) applicable to noncontrolling interests |
2,277 |
(11,699) |
NA |
Net Income applicable to Raymond James Financial, Inc. |
$98,531 |
$67,186 |
47% |
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Net Income per common share basic |
$0.79 |
$0.55 |
44% |
Net Income per common share diluted |
$0.79 |
$0.55 |
44% |
Weighted average common shares outstanding-basic |
118,981 |
116,685 |
|
Weighted average common and common equivalent shares outstanding-diluted |
119,234 |
116,812 |
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–30–
For additional information, please contact Anthea Penrose at 727-567-2824.
Please visit the Raymond James Press Center at raymondjames.com/media.
* For the three and six months ended March 31, 2009, we reclassified the waiver of money market fees from Other Expense to Investment Advisory Fees revenue. This resulted in a $4.7 million reclassification between revenues and expenses.
** During the quarter ended December 31, 2009, we changed the methodology used to calculate basic and diluted earnings per share in accordance with new accounting guidance (Financial Accounting Standards Board ASC 260-10-45). Prior period earnings per basic and diluted shares have been restated. Earnings per basic and diluted shares were unchanged for the quarter ended March 31, 2009 and have been reduced by $0.02 for the year ended March 31, 2009, respectively.
*** Total assets include $3.2 billion invested in qualifying assets comprised of $2.0 billion in reverse repurchase agreements (collateralized by GNMA and U.S. Treasury securities) and $1.2 billion in U.S. Treasury securities, offset by $900 million in overnight borrowing and $2.3 billion in customer deposits, the majority of which were redirected during October 2009 to third party banks participating in the Raymond James Bank Deposit Program, to meet point-in-time regulatory balance sheet composition requirements related to RJ Bank’s qualifying as a thrift institution.
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