Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K FILING DOCUMENT - FBR & Co. | document.htm |
EXHIBIT 99.1
FBR Reports First Quarter Financial Results
ARLINGTON, Va., April 24, 2012 (GLOBE NEWSWIRE) -- FBR & Co. (Nasdaq:FBRC) ("FBR" or the "Company"), a leading investment bank serving the middle market, today reported net after-tax earnings of $0.4 million, or $0.01 per share, for the first quarter 2012 compared to a net after-tax loss of $1.9 million, or $0.03 per share, in the first quarter 2011. These results compare to a net after-tax loss of $18.9 million, or $0.33 per share, for the quarter ended December 31, 2011.
First quarter 2012 revenue was $39.1 million compared to $50.1 million in the first quarter 2011 and $27.7 million for the fourth quarter 2011.
First quarter 2012 total expenses were $38.6 million, compared to $52.1 million in the first quarter 2011 and $46.9 million in the fourth quarter 2011. Non-compensation fixed expenses in the first quarter 2012 totaled $12.4 million, compared to $15.2 million in the first quarter 2011 and $14.3 million in the fourth quarter 2011.
First Quarter Overview
- Investment banking revenue was $16.2 million compared to $16.6 million in the first quarter 2011 and $6.5 million in the fourth quarter 2011. The Company was bookrunner on two IPOs and one private placement during the quarter.
- Institutional brokerage generated net revenue of $16.1 million compared to $23.1 million in the first quarter 2011 and $14.9 million in the fourth quarter 2011. Results in brokerage were impacted by continued industry-wide pressure on equity commissions.
- Mutual fund assets under management as of March 31, 2012 rose to $1.9 billion compared to $1.7 billion as of March 31, 2011 and $1.7 billion at the end of 2011. Asset management revenue was $4.0 million in the first quarter 2012, compared to $4.0 million in the first quarter 2011 and $3.5 million in the fourth quarter 2011.
- The Company ended the first quarter with 281 employees, down from 465 at the end of the first quarter 2011 and 295 at the beginning of 2012.
The Company periodically repurchased shares of its common stock during the quarter. For the quarter ended March 31, 2012, the Company repurchased 500,000 shares at an average price of $2.55 per share. The Company continues to have authority to repurchase 2.6 million shares.
During the first quarter, shareholders' equity was relatively unchanged since year end 2011 and as of March 31, 2012, it totaled $225.3 million. As of March 31, 2012, the Company held $168.5 million in cash and its book value per share was $4.01.
"An improved capital markets environment in the first quarter allowed us to complete several important transactions from our backlog," said Richard J. Hendrix, President and Chief Executive Officer of FBR. "This activity, combined with significantly lower expenses as a result of our recent restructuring, enabled us to deliver meaningfully improved results relative to a very difficult second half of 2011."
Investors wishing to listen to the earnings call at 9:00 A.M. U.S. EDT, Wednesday, April 25, 2012, may do so via the Web or conference call at:
Webcast link:
http://investor.shareholder.com/media/eventdetail.cfm?eventid=106511&CompanyID=FBCM&e=1&mediaKey=A638ADF35B185A230531194DBE6AEB85
Conference call dial-in number (domestic, toll-free): 877.303.6433
Conference call dial-in number (international): 224.357.2198
Conference call code: 33390461
Replays of the earnings call will be available via webcast following the call.
FBR & Co. (Nasdaq:FBRC) provides investment banking, merger and acquisition advisory, institutional brokerage, and research services through its subsidiary FBR Capital Markets & Co. FBR focuses capital and financial expertise on the following industry sectors: consumer; diversified industrials; energy & natural resources; financial institutions; insurance; real estate; and technology, media & telecom. FBR Fund Advisers, Inc., a subsidiary of FBR & Co., provides clients with a range of investment choices through The FBR Funds, a family of mutual funds. FBR is headquartered in the Washington, D.C. metropolitan area with offices throughout the United States. For more information, please visit www.fbr.com.
The FBR & Co. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=6405
Statements in this release concerning future performance, developments, events, market forecasts, revenues, expenses, earnings, run rates and any other guidance on present or future periods constitute forward-looking statements. These forward-looking statements are subject to a number of factors, risks and uncertainties that might cause actual results to differ materially from stated expectations or current circumstances. These factors include, but are not limited to, the effect of demand for public and private securities offerings, activity in the secondary securities markets, interest rates, the realization of gains and losses on principal investments, available technologies, competition for business and personnel, and general economic, political and market conditions. For a discussion of these and other risks and important factors that could affect FBR's future results and financial condition, see "Risk Factors" in Part I, Item 1A and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7 of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2011; and other items throughout the Company's Form 10-K, and Current Reports on Form 8-K.
Financial data follow.
| FBR & CO. | ||||
| CONSOLIDATED STATEMENTS OF OPERATIONS | ||||
| (Dollars in thousands, except per share amounts) | ||||
| (Unaudited) | ||||
| Quarter ended | ||||
| March 31, | ||||
| 2012 | 2011 | |||
| REVENUES: | ||||
| Investment banking: | ||||
| Capital raising | $ 14,174 | $ 15,110 | ||
| Advisory | 2,006 | 1,460 | ||
| Institutional brokerage: | ||||
| Principal transactions | 6,502 | 5,836 | ||
| Agency commissions | 9,550 | 17,255 | ||
| Asset management fees | 4,023 | 3,981 | ||
| Net investment income | 2,009 | 5,599 | ||
| Interest, dividends & other | 814 | 857 | ||
| Total revenues | 39,078 | 50,098 | ||
| EXPENSES: | ||||
| Compensation and benefits | 19,529 | 29,001 | ||
| Professional services | 2,983 | 3,955 | ||
| Business development | 2,877 | 3,646 | ||
| Clearing and brokerage fees | 2,384 | 2,674 | ||
| Occupancy and equipment | 4,310 | 5,105 | ||
| Communications | 3,668 | 4,351 | ||
| Other operating expenses | 2,866 | 3,336 | ||
| Total expenses | 38,617 | 52,068 | ||
| Income (loss) before income taxes | 461 | (1,970) | ||
| Income tax provision (benefit) | 23 | (65) | ||
| Net income (loss) | $ 438 | $ (1,905) | ||
| Basic earnings (loss) per share | $ 0.01 | $ (0.03) | ||
| Diluted earnings (loss) per share | $ 0.01 | $ (0.03) | ||
| Weighted average shares - basic | 56,380 | 63,510 | ||
| Weighted average shares - diluted | 57,479 | 63,510 | ||
| FBR & CO. | |||
| CONSOLIDATED BALANCE SHEETS | |||
| (Dollars in thousands, except per share amounts) | |||
| (Unaudited) | |||
| March 31, | December 31, | ||
| ASSETS | 2012 | 2011 | |
| Cash and cash equivalents | $ 168,511 | $ 135,792 | |
| Receivables: | |||
| Due from brokers, dealers and clearing organizations | 9,481 | 6,048 | |
| Customers | 5,631 | 3,937 | |
| Other | 3,200 | 6,854 | |
| Financial instruments owned, at fair value | 90,417 | 100,634 | |
| Other investments, at cost | 25,621 | 25,744 | |
| Intangible assets, net | 2,005 | 2,121 | |
| Furniture, equipment and leasehold improvements, net | 5,583 | 6,162 | |
| Prepaid expenses and other assets | 7,439 | 10,791 | |
| Total assets | $ 317,888 | $ 298,083 | |
| LIABILITIES AND SHAREHOLDERS' EQUITY | |||
| Liabilities: | |||
| Securities sold but not yet purchased, at fair value | $ 43,371 | $ 35,496 | |
| Accrued compensation and benefits | 10,054 | 15,760 | |
| Accounts payable, accrued expenses and other liabilities | 16,908 | 15,280 | |
| Due to brokers, dealers and clearing organizations | 22,282 | 6,250 | |
| Total liabilities | 92,615 | 72,786 | |
| Shareholders' equity: | |||
| Common stock | 55 | 55 | |
| Additional paid-in capital | 417,442 | 412,551 | |
| Restricted stock units | 23,661 | 29,013 | |
| Accumulated other comprehensive income | 18 | 19 | |
| Accumulated deficit | (215,903) | (216,341) | |
| Total shareholders' equity | 225,273 | 225,297 | |
| Total liabilities and shareholders' equity | $ 317,888 | $ 298,083 | |
| Book Value per Share | $4.01 | $3.99 | |
| Shares Outstanding (in thousands) | 56,167 | 56,490 | |
| FBR & CO. | |||||||||
| Financial & Statistical Supplement - Operating Results | |||||||||
| (Dollars in thousands) | |||||||||
| (Unaudited) | |||||||||
| Q-1 12 | Q-4 11 | Q-3 11 | Q-2 11 | Q-1 11 | |||||
| Revenues | $ 39,078 | $ 27,737 | $ 20,134 | $ 49,182 | $ 50,098 | ||||
| Expenses: | |||||||||
| Variable | 9,946 | 6,262 | 10,272 | 14,974 | 15,860 | ||||
| Fixed | 28,671 | 34,801 | 35,625 | 37,146 | 36,208 | ||||
| Impairment of goodwill | -- | 5,882 | -- | -- | -- | ||||
| Income (loss) before income taxes | 461 | (19,208) | (25,763) | (2,938) | (1,970) | ||||
| Income tax provision (benefit) | 23 | (327) | 373 | (211) | (65) | ||||
| Net income (loss) | $ 438 | $ (18,881) | $ (26,136) | $ (2,727) | $ (1,905) | ||||
| Fixed expenses | $ 28,671 | $ 34,801 | $ 35,625 | $ 37,146 | $ 36,208 | ||||
| Less: Non-cash expenses1 | 1,980 | 1,523 | 1,927 | 2,459 | 2,352 | ||||
| Corporate transaction costs2 | 429 | 567 | -- | 986 | -- | ||||
| Severance | 38 | 3,496 | 442 | -- | 806 | ||||
| Core fixed costs3 | $ 26,224 | $ 29,215 | $ 33,256 | $ 33,701 | $ 33,050 | ||||
| Statistical Data | |||||||||
| Revenues per employee (annualized) | $ 556 | $ 376 | $ 189 | $ 444 | $ 431 | ||||
| Employee count | 281 | 295 | 426 | 443 | 465 | ||||
| Net assets under management (in millions) | |||||||||
| Mutual funds | $ 1,937.3 | $ 1,684.8 | $ 1,358.9 | $ 1,635.3 | $ 1,689.4 | ||||
| 1 Non-cash expenses include compensation costs associated with stock-based awards and amortization of intangible assets. | |||||||||
| 2 Corporate transaction costs include costs related to reductions in physical space and restructuring costs. | |||||||||
| 3 Core fixed costs is a non-GAAP measurement used by management to analyze and assess the Company's fixed operating costs. Management believes that this non-GAAP measurement assists investors in understanding the impact of the items noted in footnotes 1 and 2 and severance costs on the performance of the Company. | |||||||||
| A limitation of utilizing this non-GAAP measure is that the GAAP accounting effects of these items do in fact reflect the underlying financial results of the Company and these effects should not be ignored in evaluating and analyzing the Company's financial results. Therefore, management believes fixed expenses on a GAAP basis and core fixed costs on a non-GAAP basis should be considered together. | |||||||||
CONTACT: Media: Shannon Small at 703.469.1190
or ssmall@fbr.com
Investors: Bradley J. Wright at 703.469.1080
or fbrcir@fbr.com