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Exhibit 99.1

 

LOGO

STIFEL REPORTS FOURTH QUARTER AND FULL-YEAR 2013 FINANCIAL RESULTS

18th Consecutive Year of Record Net Revenues

Record Revenues & Pre-Tax Operating Income in Both Global Wealth and Institutional Group for 2013

 

    Record net revenues of $562.5 million, increased 37% compared with the year-ago quarter.

 

    Net income from continuing operations of $52.1 million, or $0.69 per diluted common share.

 

    Non-GAAP net income from continuing operations of $59.8 million, or $0.79 per diluted share.

ST. LOUIS, February 24, 2014 – Stifel Financial Corp. (NYSE: SF) today reported net income from continuing operations of $52.1 million, or $0.69 per diluted common share on record net revenues of $562.5 million for the three months ended December 31, 2013, compared with net income from continuing operations of $43.3 million, or $0.69 per diluted common share, on net revenues of $411.3 million for the fourth quarter of 2012.

For the three months ended December 31, 2013, the Company reported non-GAAP net income from continuing operations of $59.8 million, or $0.79 per diluted common share. These non-GAAP results exclude merger-related expenses associated with the acquisitions of the Knight Capital Fixed Income business, KBW, and Miller Buckfire for a total of $7.7 million (after-tax). A reconciliation of the Company’s GAAP results to these non-GAAP measures is discussed below under “Non-GAAP Financial Measures.”

 

Summary Results of Operations (Unaudited)

 
     Three Months Ended     Year Ended  
(in 000s)    12/31/13     12/31/12     %
Change
    9/30/13     %
Change
    12/31/13     12/31/12     %
Change
 

Net revenues

   $ 562,526      $ 411,283        36.8      $ 478,639        17.5      $ 1,973,446      $ 1,594,113        23.8   

Net income from continuing operations

   $ 52,126      $ 43,284        20.4      $ 74,929        (30.4   $ 172,907      $ 145,296        19.0   

Net income

   $ 48,269      $ 39,954        20.8      $ 69,690        (40.8   $ 162,013      $ 138,573        16.9   

Non-GAAP net income from continuing operations1

   $ 59,819      $ 43,284        38.2      $ 39,649        50.9      $ 184,658      $ 145,296        27.1   

Earnings per basic common share:

                

Income from continuing operations

   $ 0.82      $ 0.80        2.5      $ 1.16        (29.3   $ 2.67      $ 2.71        (1.5

Loss from discontinued operations

     (0.06     (0.06     —          (0.08     (25.0     (0.17     (0.12     41.7   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Earnings per basic common share

   $ 0.76      $ 0.74        2.5      $ 1.08        (29.6   $ 2.50      $ 2.59        3.5   

Earnings per diluted common share:

                

Income from continuing operations

   $ 0.69      $ 0.69        —        $ 1.00        (31.0   $ 2.35      $ 2.31        1.7   

Loss from discontinued operations

     (0.05     (0.06     (16.7     (0.07     (28.6     (0.15     (0.11     36.4   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Earnings per diluted common share

   $ 0.64      $ 0.63        1.6      $ 0.93        (31.2   $ 2.20      $ 2.20        —     

Non-GAAP net income from continuing operations1

   $ 0.79      $ 0.69        14.5      $ 0.53        49.1      $ 2.51      $ 2.31        8.7   

Weighted average number of common shares outstanding:

                

Basic

     64,859        53,835        20.5        64,706        0.2        63,568        53,563        18.7   

Diluted

     75,495        63,301        19.3        75,191        0.4        73,504        62,937        16.8   

 

1  A reconciliation of the Company’s GAAP results to these non-GAAP measures is discussed under “Non-GAAP Financial Measures.”

 

1


Full-Year 2013 Results

 

    Record net revenues of $1.97 billion, increased 24% compared with the year-ago period.

 

    Net income from continuing operations of $172.9 million, or $2.35 per diluted common share.

 

    Non-GAAP net income of $184.7 million, or $2.51 per diluted common share.

For the year ended December 31, 2013, the Company reported net income from continuing operations of $172.9 million, or $2.35 per diluted common share on record net revenues of $1.97 billion, compared with net income from continuing operations of $145.3 million, or $2.31 per diluted common share, on net revenues of $1.59 billion in 2012. For the year ended December 31, 2013, the Company reported non-GAAP net income from continuing operations of $184.7 million, or $2.51 per diluted common share. A reconciliation of the Company’s GAAP results to these non-GAAP measures is discussed below under “Non-GAAP Financial Measures.”

Chairman’s Comments

Ronald J. Kruszewski, Chairman, President and CEO of Stifel said, “We are very pleased to post our 18th consecutive year of record net revenues. This speaks to the dedication of our over 5,800 professionals, as well as to our balanced business model. Non-GAAP net income from continuing operations for the year improved over the prior year as a result of both better market conditions and the benefits of our recent acquisitions.”

Kruszewski continued, “Looking forward, we will continue to take advantage of opportunities in the marketplace that add to shareholder value.”

Business Segment Results

 

Summary Segment Results (Unaudited)

 
     Three Months Ended     Year Ended  
(in 000s)    12/31/13     12/31/12     %
Change
     9/30/13     %
Change
    12/31/13     12/31/12     %
Change
 

Net revenues:

                 

Global Wealth Management

   $ 292,836      $ 253,775        15.4       $ 274,669        6.6      $ 1,117,179      $ 991,597        12.7   

Institutional Group

     267,282        160,693        66.3         205,132        30.3        861,158        604,654        42.4   

Other

     2,408        (3,185     175.6         (1,162     (175.6     (4,891     (2,138     (128.7
  

 

 

   

 

 

   

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
   $ 562,526      $ 411,283        36.8       $ 478,639        17.5      $ 1,973,446      $ 1,594,113        23.8   
  

 

 

   

 

 

   

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating contribution: 2

                 

Global Wealth Management

   $ 79,022      $ 68,737        15.0       $ 72,128        9.6      $ 299,572      $ 266,669        12.3   

Institutional Group

     48,590        21,678        124.1         34,986        38.9        142,889        101,487        40.8   

Other

     (37,184     (30,064     23.7         (41,669     (10.8     (147,377     (138,409     6.5   
  

 

 

   

 

 

   

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 
   $ 90,428      $ 60,351        49.8       $ 65,443        38.2      $ 295,084      $ 229,747        28.4   
  

 

 

   

 

 

   

 

 

    

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

As a percentage of net revenues:

                 

Compensation and benefits

                 

Global Wealth Management

     57.4        57.7           58.2          58.1        58.2     

Institutional Group

     62.0        65.4           58.4          60.9        62.9     

Non-comp. operating expenses

                 

Global Wealth Management

     15.6        15.2           15.5          15.1        14.9     

Institutional Group

     19.8        21.1           24.5          22.5        20.3     

Income before income taxes

                 

Global Wealth Management

     27.0        27.1           26.3          26.8        26.9     

Institutional Group

     18.2        13.5           17.1          16.6        16.8     

Other

     (6.5     (7.3        (8.7       (7.4     (8.7  
  

 

 

   

 

 

      

 

 

     

 

 

   

 

 

   
     16.0        14.7           13.6          14.9        14.4     
  

 

 

   

 

 

      

 

 

     

 

 

   

 

 

   

 

2  A reconciliation of the Company’s GAAP results to these non-GAAP measures is discussed under “Non-GAAP Financial Measures.”

 

2


Fourth Quarter 2013

Global Wealth Management

For the quarter ended December 31, 2013, the Global Wealth Management segment generated record pre-tax operating income of $79.0 million, compared with $68.7 million in the fourth quarter of 2012 and $72.1 million in the third quarter of 2013. Net revenues for the quarter were a record $292.8 million, compared with $253.8 million in the fourth quarter of 2012, and $274.7 million in the third quarter of 2013. The increase in net revenues from the fourth quarter of 2012 is primarily attributable to (1) growth in asset management and service fees; (2) an increase in commission revenues; and (3) increased net interest revenues.

 

    The Private Client Group reported net revenues of $256.1 million, an 11% increase compared with the fourth quarter of 2012 and a 3% increase compared with the third quarter of 2013.

 

    Stifel Bank reported record net revenues of $36.7 million, an 63% increase compared with the fourth quarter of 2012 and a 40% increase compared with the third quarter of 2013.

Institutional Group

For the quarter ended December 31, 2013, the Institutional Group segment generated record pre-tax operating income of $48.6 million, compared with $21.7 million in the fourth quarter of 2012 and $35.0 million in the third quarter of 2013. Net revenues for the quarter were a record $267.3 million, compared with $160.7 million in the fourth quarter of 2012 and $205.1 million in the third quarter of 2013. The increase in net revenues from the fourth quarter of 2012 was primarily attributable to (1) an increase in advisory fees; (2) an increase in equity capital raising revenues; and (3) higher institutional brokerage revenues, offset by a reduction in other revenues as a result of gains recorded on the investment in Knight Capital during the fourth quarter of 2012. Net revenue growth, on a year-over-year basis, is attributable to the acquisitions of KBW and the Knight Capital Fixed Income business and, to a lesser extent, Miller Buckfire.

Institutional brokerage revenues were $111.3 million, a 35% increase compared with the fourth quarter of 2012 and a 1% increase compared with the third quarter of 2013.

 

    Equity brokerage revenues were $60.2 million, a 56% increase compared with the fourth quarter of 2012 and a 3% increase compared with the third quarter of 2013.

 

    Fixed income brokerage revenues were $51.1 million, a 17% increase compared with the fourth quarter of 2012 and a 1% decrease compared with the third quarter of 2013.

Investment banking revenues were a record $149.3 million, a 140% increase compared with the fourth quarter of 2012 and a 79% increase compared with the third quarter of 2013.

 

    Equity capital raising revenues were $46.6 million, a 175% increase compared with the fourth quarter of 2012 and a 52% increase compared with the third quarter of 2013.

 

    Fixed income capital raising revenues were $14.7 million, a 21% decrease compared with the fourth quarter of 2012 and a 9% increase compared with the third quarter of 2013.

 

    Advisory fee revenues were $88.0 million, a 231% increase compared with the fourth quarter of 2012 and a 125% increase compared with the third quarter of 2013.

Consolidated Compensation and Benefits Expenses

For the quarter ended December 31, 2013, compensation and benefits expenses were $353.2 million, which included merger-related expenses of $5.9 million, compared with $258.1 million in the fourth quarter of 2012 and $326.0 million in the third quarter of 2013, which included merger-related expenses of $28.6 million.

Excluding merger-related expenses, compensation and benefits as a percentage of net revenues was 61.5% in the fourth quarter of 2013, compared with 62.8% in the fourth quarter of 2012 and 62.0% in the third quarter of 2013. Transition pay, which primarily consists of amortization of retention awards, signing bonuses, and upfront notes, as a percentage of net revenues was 4.0% in the fourth quarter of 2013, compared with 5.0% in the fourth quarter of 2012 and 4.6% in the third quarter of 2013.

 

3


Consolidated Non-Compensation Operating Expenses

For the quarter ended December 31, 2013, non-compensation operating expenses were $131.3 million, which included $4.3 million of merger-related expenses, compared with $92.8 million in the fourth quarter of 2012 and $121.6 million in the third quarter of 2013, which included $4.8 million in merger-related expenses.

Excluding merger-related expenses, non-compensation operating expenses as a percentage of net revenues for the quarter ended December 31, 2013 was 22.5%, compared with 22.6% in the fourth quarter of 2012 and 24.4% in the third quarter of 2013.

Provision for Income Taxes

The effective income tax rate for the quarter ended December 31, 2013 was 33.9% compared with 28.3% in the fourth quarter of 2012.

Full-Year 2013

Global Wealth Management

For the year ended December 31, 2013, the Global Wealth Management segment generated record pre-tax operating income of $299.6 million, compared with $266.7 million in 2012. Net revenues for the year were a record $1.11 billion, compared with $991.6 million in 2012. The increase in net revenues from 2012 is primarily attributable to (1) an increase in commission revenues; (2) growth in asset management and service fees; and (3) increased net interest revenues.

 

    The Private Client Group reported record net revenues of $1.0 billion, a 10% increase compared to $911.7 million in 2012.

 

    Stifel Bank reported record net revenues of $112.1 million, a 40% increase compared to $79.9 million in 2012.

Institutional Group

For the year ended December 31, 2013, the Institutional Group segment generated record pre-tax operating income of $142.9 million, compared with $101.5 million in 2012. Net revenues for the year were a record $861.2 million, compared with $604.7 million in 2012. The increase in net revenues from 2012 was primarily attributable to (1) an increase in advisory fees; (2) an increase in equity capital raising revenues; and (3) higher equity institutional brokerage revenues, offset by a reduction in other revenues as a result of gains recorded on the investment in Knight Capital during 2012. Net revenue growth, on a year-over-year basis, is attributable to the acquisitions of KBW and the Knight Capital Fixed Income business and, to a lesser extent, Miller Buckfire.

Institutional brokerage revenues were $421.6 million, a 30% increase compared to $323.5 million in 2012.

 

    Equity brokerage revenues were $232.4 million, a 54% increase compared to $151.3 million in 2012.

 

    Fixed income brokerage revenues were $189.2 million, a 10% increase compared to $172.2 million in 2012.

Investment banking revenues were a record $402.7 million, a 70% increase compared to $236.4 million in 2012.

 

    Equity capital raising revenues were $142.6 million, a 74% increase compared to $81.8 million in 2012.

 

    Fixed income capital raising revenues were $58.1 million, a 2% decrease compared to $59.0 million in 2012.

 

    Advisory fee revenues were $201.9 million, a 111% increase compared with to $95.5 million in 2012.

 

4


Consolidated Compensation and Benefits Expenses

For the year ended December 31, 2013, compensation and benefits expenses were $1.3 billion, which included merger-related expenses of $74.4 million, compared to $1.0 billion in 2012.

Excluding merger-related expenses, compensation and benefits as a percentage of net revenues for the year ended December 31, 2013 was 62.5%, compared with 63.4% in 2012. Transition pay as a percentage of net revenues for the year ended December 31, 2013 was 4.4%, compared with 4.6% in 2012.

Consolidated Non-Compensation Operating Expenses

For the year ended December 31, 2013, non-compensation operating expenses were $476.8 million, which included $30.6 million of merger-related expenses, compared with $354.2 million in 2012.

Excluding merger-related expenses, non-compensation operating expenses as a percentage of net revenues for the year ended December 31, 2013 was 22.6%, compared with 22.2% in 2012.

Provision for Income Taxes

The effective income tax rate for the year ended December 31, 2013 was 6.7% compared with 36.8% in the 2012. The effective rate in 2013 reflects a $58.2 million U.S. tax benefit arising out of its investment in SN Canada in connection with discontinuing the business operations during 2013.

Assets and Capital

Assets

 

    Assets increased 29% to $9.0 billion as of December 31, 2013 from $7.0 billion as of December 30, 2012. The increase is primarily attributable to growth of Stifel Bank, the Company’s bank subsidiary, which as of December 31, 2013 has grown its assets to $5.0 billion from $3.7 billion as of December 31, 2012.

 

    At December 31, 2013, the Company’s Level 3 assets of $232.0 million, or 3% of total assets, consisted of $125.7 million of auction rate securities and $106.2 million of private equity, municipal securities, and other fixed income securities. The Company’s Level 3 assets as a percentage of total assets measured at fair value was 8% at December 31, 2013.

 

    Non-performing assets as a percentage of total assets as of December 31, 2013 was 0.03%.

Capital

 

    The Company’s Tier 1 leverage capital ratio was 15.4% at December 31, 2013 and Tier 1 risk-based capital ratio was 26.7% at December 31, 2013.

 

    At December 31, 2013, book value per common share was $32.30 based on 63.7 million shares outstanding.

 

    Stockholders’ equity as of December 31, 2013 increased $564.2 million, or 38%, to $2.1 billion from $1.5 billion as of December 31, 2012.

 

5


Non-GAAP Financial Measures

The Company utilized non-GAAP calculations of presented net revenues, compensation and benefits, non-compensation operating expenses, income before income taxes, provision for income taxes, net income, compensation and non-compensation operating expense ratios, pre-tax margin and diluted earnings per share as additional measures to aid in understanding and analyzing the Company’s financial results for the three and twelve months ended December 31, 2013. Specifically, the Company believes that the non-GAAP measures provide useful information by excluding certain items that may not be indicative of the Company’s core operating results and business outlook. The Company believes that these non-GAAP measures will allow for a better evaluation of the operating performance of the business and facilitate a meaningful comparison of the Company’s results in the current period to those in prior and future periods. Reference to these non-GAAP measures should not be considered as a substitute for results that are presented in a manner consistent with GAAP. These non-GAAP measures are provided to enhance investors’ overall understanding of the Company’s current financial performance. These non-GAAP amounts exclude compensation expense related to the granting of stock awards with no continuing service requirement issued as retention as part of the acquisitions of the Knight Capital Fixed Income business and KBW and certain compensation and non-compensation operating expenses associated with the acquisitions of KBW, Miller Buckfire, the Knight Capital Fixed Income business, and the U.S. tax benefit arising out of the Company’s investment in SN Canada.

A limitation of utilizing these non-GAAP measures of net revenues, compensation and benefits, non-compensation operating expenses, income before income taxes, provision for income taxes, net income, compensation and non-compensation operating expenses ratios, pre-tax margin and diluted earnings per share is that the GAAP accounting effects of these merger-related charges do in fact reflect the underlying financial results of the Company’s business and these effects should not be ignored in evaluating and analyzing its financial results. Therefore, the Company believes that GAAP measures of net revenues, compensation and benefits, non-compensation operating expenses, income before income taxes, provision for income taxes, net income, compensation and non-compensation operating expense ratios, pre-tax margin and diluted earnings per share and the same respective non-GAAP measures of the Company’s financial performance should be considered together.

The following table provides details with respect to reconciling net revenues, compensation and benefits, non-compensation operating expenses, income before income taxes, provision for income taxes, net income, compensation and non-compensation operating expense ratios, pre-tax margin and diluted earnings per share on a GAAP basis for the three and twelve months ended December 31, 2013 to the aforementioned expenses on a non-GAAP basis for the same period.

 

     Three Months Ended December 31, 2013      Year Ended December 31, 2013  
(in 000s, except per share amounts)    Non-GAAP      Non-Core     GAAP      Non-GAAP      Non-Core     GAAP  

Net revenues

   $ 564,681       $ (2,155   $ 562,526       $ 1,978,340       $ (4,894   $ 1,973,446   

Non-interest expenses:

               

Compensation and benefits

     347,263         5,944        353,207         1,236,991         74,395        1,311,386   

Non-compensation operating expenses

     126,990         4,340        131,330         446,265         30,566        476,831   
  

 

 

    

 

 

   

 

 

    

 

 

    

 

 

   

 

 

 

Total non-interest expenses

     474,253         10,284        484,537         1,683,256         104,961        1,788,217   

Income from continuing operations before income taxes

     90,428         (12,439     77,989         295,084         (109,855     185,229   

Provision for income taxes

     30,609         (4,746     25,863         110,426         (98,104     12,322   
  

 

 

    

 

 

   

 

 

    

 

 

    

 

 

   

 

 

 

Net income from continuing operations

   $ 59,819       $ (7,693   $ 48,269       $ 184,658       $ (11,751   $ 172,907   
  

 

 

    

 

 

   

 

 

    

 

 

    

 

 

   

 

 

 

Earnings per common share:

               

Diluted

   $ 0.79       $ (0.10   $ 0.69       $ 2.51       $ (0.16   $ 2.35   

As a percentage of net revenues:

               

Compensation and benefits

     61.5           62.8         62.5           66.5   

Non-compensation operating expenses

     22.5           23.3         22.6           24.1   

Income before income taxes

     16.0           13.9         14.9           9.4   

 

6


Conference Call Information

Stifel Financial Corp. will host its fourth quarter and full-year 2013 financial results conference call on Monday, February 24, 2014, at 5:00 p.m. Eastern time. The conference call may include forward-looking statements.

All interested parties are invited to listen to Stifel’s Chairman, President, and CEO, Ronald J. Kruszewski, by dialing (888) 676-3684 and referencing conference ID #22974566. A live audio webcast of the call, as well as a presentation highlighting the Company’s results, will be available through the Company’s web site, www.stifel.com. For those who cannot listen to the live broadcast, a replay of the broadcast will be available through the above-referenced web site beginning approximately one hour following the completion of the call.

Company Information

Stifel Financial Corp. (NYSE: SF) is a financial services holding company headquartered in St. Louis, Missouri, that conducts its banking, securities, and financial services business through several wholly owned subsidiaries. Stifel’s broker-dealer clients are served in the United States through Stifel, Nicolaus & Company, Incorporated; Keefe, Bruyette & Woods, Inc.; Miller Buckfire & Co., LLC; and Century Securities Associates, Inc. and through Stifel Nicolaus Europe Limited and Keefe, Bruyette & Woods Limited in the United Kingdom and Europe. The Company’s broker-dealer affiliates provide securities brokerage, investment banking, trading, investment advisory, and related financial services to individual investors, professional money managers, businesses, and municipalities. Stifel Bank & Trust offers a full range of consumer and commercial lending solutions. Stifel Trust Company, N.A. offers trust and related services. To learn more about Stifel, please visit the Company’s web site at www.stifel.com.

Forward-Looking Statements

This earnings release contains certain statements that may be deemed to be “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements in this earnings release not dealing with historical results are forward-looking and are based on various assumptions. The forward-looking statements in this earnings release are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in or implied by the statements. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, among other things, the following possibilities: the ability to successfully integrate acquired companies or the branch offices and financial advisors; a material adverse change in financial condition; the risk of borrower, depositor, and other customer attrition; a change in general business and economic conditions; changes in the interest rate environment, deposit flows, loan demand, real estate values, and competition; changes in accounting principles, policies, or guidelines; changes in legislation and regulation; other economic, competitive, governmental, regulatory, geopolitical, and technological factors affecting the companies’ operations, pricing, and services; and other risk factors referred to from time to time in filings made by Stifel Financial Corp. with the Securities and Exchange Commission. Forward-looking statements speak only as to the date they are made. Stifel Financial Corp. disclaims any intent or obligation to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made.

 

7


Summary Results of Operations (Unaudited)

 

 
     Three Months Ended     Year Ended  
(in thousands, except per share amounts)    12/31/13     12/31/12     %
Change
    9/30/13     %
Change
    12/31/13     12/31/12     %
Change
 

Revenues:

                

Commissions

   $ 152,451      $ 131,327        16.1      $ 145,837        4.5      $ 598,949      $ 501,434        19.4   

Principal transactions

     118,815        97,515        21.8        122,583        (3.1     459,968        408,935        12.5   

Investment banking

     158,860        72,938        117.8        92,851        71.1        448,060        281,280        59.3   

Asset management and service fees

     83,928        68,971        21.7        76,710        9.4        305,639        257,981        18.5   

Other income

     19,391        19,157        1.2        13,063        48.4        64,659        69,148        (6.5
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating revenues

     533,445        389,908        36.8        451,044        18.3        1,877,275        1,518,778        23.6   

Interest revenue

     40,711        29,977        35.8        39,130        4.0        142,539        108,705        31.1   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total revenues

     574,156        419,885        36.7        490,174        17.1        2,019,814        1,627,483        24.1   

Interest expense

     11,630        8,602        35.2        11,535        0.8        46,368        33,370        39.0   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net revenues

     562,526        411,283        36.8        478,639        17.5        1,973,446        1,594,113        23.8   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Non-interest expenses:

                

Compensation and benefits

     353,207        258,148        36.8        326,020        8.3        1,311,386        1,010,140        29.8   

Occupancy and equipment rental

     42,178        33,589        25.6        41,288        2.2        158,268        128,365        23.3   

Communications and office supplies

     25,692        19,291        33.2        26,122        (1.6     99,726        79,406        25.6   

Commission and floor brokerage

     8,448        7,271        16.2        10,150        (16.8     37,225        29,610        25.7   

Other operating expenses

     55,012        32,633        68.6        44,051        24.9        181,612        116,845        55.4   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total non-interest expenses

     484,537        350,932        38.1        447,631        8.2        1,788,217        1,364,366        31.1   

Income from continuing operations before income taxes

     77,989        60,351        29.2        31,008        151.5        185,229        229,747        (17.2

Provision for income taxes

     25,863        17,067        51.5        (43,921     (158.9     12,322        84,451        (19.4
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income from continuing operations

     52,126        43,284        20.4        74,929        (30.4     172,907        145,296        19.0   

Discontinued operations:

                

Loss from discontinued operations, net of tax

     (3,857     (3,330     15.8        (5,239     (26.4     (10,894     (6,723     62.1   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income

   $ 48,269      $ 39,954        20.8      $ 69,690        (40.8   $ 162,013      $ 138,573        16.9   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Earnings per basic common share:

                

Income from continuing operations

   $ 0.82      $ 0.80        2.5      $ 1.16        (29.3   $ 2.67      $ 2.71        (1.5

Loss from discontinued operations

     (0.06     (0.06     —          (0.08     (25.0     (0.17     (0.12     41.7   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Earnings per basic common share

   $ 0.76      $ 0.74        2.5      $ 1.08        (29.6   $ 2.50      $ 2.59        (3.5
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Earnings per diluted common share:

                

Income from continuing operations

   $ 0.69      $ 0.69        —        $ 1.00        (31.0   $ 2.35      $ 2.31        1.7   

Loss from discontinued operations

     (0.05     (0.06     (16.7     (0.07     (28.6     (0.15     (0.11     36.4   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Earnings per diluted common share

   $ 0.64      $ 0.63        1.6      $ 0.93        (31.2   $ 2.20      $ 2.20        —     
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average number of common shares outstanding:

                

Basic

     64,859        53,835        20.5        64,706        0.2        63,568        53,563        18.7   

Diluted

     75,495        63,301        19.3        75,191        0.4        73,504        62,937        16.8   

 

8


(in thousands, except per share, employee and location amounts)  
     12/31/13      12/31/12      % Change      9/30/13      % Change  

Statistical Information:

              

Book value per common share

   $ 32.30       $ 27.24         18.7       $ 31.46         2.7   

Financial advisors 3

     2,077         2,041         1.8         2,075         0.1   

Full-time associates

     5,862         5,343         9.7         5,780         1.4   

Locations

     357         340         5.0         355         0.6   

Total client assets

   $ 165,570,000       $ 137,855,000         20.1       $ 153,901,000         7.6   

 

3  Includes 143, 151 and 145 independent contractors at December 31, 2013 and 2012 and September 30, 2013, respectively.

 

9


Global Wealth Management Summary Results of Operations (Unaudited)

 

 
     Three Months Ended     Year Ended  
(in 000s)    12/31/13      12/31/12      %
Change
    9/30/13      %
Change
    12/31/13      12/31/12      %
Change
 

Revenues:

                     

Commissions

   $ 104,149       $ 93,043         11.9      $ 99,427         4.7      $ 410,238       $ 361,871         13.4   

Principal transactions

     55,809         53,542         4.2        58,658         (4.9     227,087         225,007         0.9   

Asset management and service fees

     82,964         68,631         20.9        76,667         8.2        304,541         257,257         18.4   

Net interest

     31,092         21,182         46.8        27,665         12.4        104,748         79,328         32.0   

Investment banking

     9,568         10,818         (11.6     9,394         1.8        45,400         44,919         1.1   

Other income

     9,254         6,559         41.1        2,858         223.9        26,165         23,215         8.4   
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 

Net revenues

     292,836         253,775         15.4        274,669         6.6        1,117,179         991,597         12.7   
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 

Non-interest expenses:

                     

Compensation and benefits

     167,980         146,311         14.8        159,949         5.0        648,681         576,744         12.5   

Non-compensation operating expenses

     45,834         38,727         18.3        42,592         7.6        168,926         148,184         14.0   
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 

Total non-interest expenses

     213,814         185,038         15.6        202,541         5.6        817,607         724,928         12.8   
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 

Income before income taxes

   $ 79,022       $ 68,737         15.0      $ 72,128         9.6      $ 299,572       $ 266,669         12.3   
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 

As a percentage of net revenues:

                     

Compensation and benefits

     57.4         57.7           58.2           58.1         58.2      

Non-compensation operating expenses

     15.6         15.2           15.5           15.1         14.9      

Income before income taxes

     27.0         27.1           26.3           26.8         26.9      

 

Stifel Bank & Trust (Unaudited)

 

 

Key Statistical Information

 
(in 000s, except percentages)    12/31/13     12/31/12     %
Change
    9/30/13     %
Change
 

Other information:

          

Assets

   $ 5,027,023      $ 3,650,235        37.7      $ 4,547,071        10.6   

Investment securities

     3,062,549        2,327,316        31.6        2,949,080        3.8   

Retained loans, net

     1,412,136        822,711        71.6        1,061,313        33.1   

Loans held for sale

     109,110        214,531        (49.1     75,440        44.6   

Deposits

     4,661,444        3,346,133        39.3        4,228,405        10.2   

Allowance as a percentage of loans

     0.89     0.99       1.23  

Non-performing assets as a percentage of total assets

     0.03     0.06       0.32  

 

10


Institutional Group Summary Results of Operations (Unaudited)

 

 
     Three Months Ended     Year Ended  
(in 000s)    12/31/13      12/31/12      %
Change
    9/30/13      %
Change
    12/31/13      12/31/12      %
Change
 

Revenues:

                     

Commissions

   $ 48,302       $ 38,284         26.2      $ 46,410         4.1      $ 188,712       $ 139,564         35.2   

Principal transactions

     63,005         43,973         43.3        63,925         (1.4     232,880         183,927         26.6   

Capital raising

     61,311         35,502         72.7        44,270         38.5        200,732         140,842         42.5   

Advisory fees

     87,981         26,618         230.5        39,186         124.5        201,928         95,519         111.4   
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 

Investment banking

     149,292         62,120         140.3        83,456         78.9        402,660         236,361         70.4   

Other 4

     6,683         16,316         (59.0     11,341         (41.1     36,906         44,802         (17.6
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 

Net revenues

     267,282         160,693         66.3        205,132         30.3        861,158         604,654         42.4   
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 

Non-interest expenses:

                     

Compensation and benefits

     165,779         105,025         57.8        119,874         38.3        524,870         380,185         38.1   

Non-compensation operating expenses

     52,913         33,990         55.7        50,272         5.3        193,399         122,982         57.3   
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 

Total non-interest expenses

     218,692         139,015         57.3        170,146         28.5        718,269         503,167         42.7   
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 

Income before income taxes

   $ 48,590       $ 21,678         124.1      $ 34,986         38.9      $ 142,889       $ 101,487         40.8   
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 

As a percentage of net revenues:

                     

Compensation and benefits

     62.0         65.4           58.4           60.9         62.9      

Non-compensation operating expenses

     19.8         21.1           24.5           22.5         20.3      

Income before income taxes

     18.2         13.5           17.1           16.6         16.8      

 

Institutional Group Brokerage & Investment Banking Revenues (Unaudited)

 

 
     Three Months Ended     Year Ended  
(in 000s)    12/31/13      12/31/12      %
Change
    9/30/13      %
Change
    12/31/13      12/31/12      %
Change
 

Institutional brokerage:

                     

Equity

   $ 60,204       $ 38,659         55.7      $ 58,677         2.6      $ 232,392       $ 151,308         53.6   

Fixed income

     51,103         43,598         17.2        51,658         (1.1     189,200         172,183         9.9   
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 

Institutional brokerage

     111,307         82,257         35.3        110,335         0.9        421,592         323,491         30.3   

Investment banking:

                     

Capital raising:

                     

Equity

     46,634         16,947         175.2        30,739         51.7        142,636         81,818         74.3   

Fixed income

     14,677         18,555         (20.9     13,531         8.5        58,096         59,024         (1.6
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 

Capital raising

     61,311         35,502         72.7        44,270         38.5        200,732         140,842         42.5   

Advisory fees:

     87,981         26,618         230.5        39,186         124.5        201,928         95,519         111.4   
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 

Investment banking

   $ 149,292       $ 62,120         140.3      $ 83,456         78.9      $ 402,660       $ 236,361         70.4   
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 

Investor Relations

Sarah Anderson

(415) 364-2500, investorrelations@stifel.com

 

4  Includes net interest and other income.

 

11