Stifel Financial Corp. (NYSE: SF) today reported net revenues of
$1.0 billion for the three months ended September 30, 2023,
compared with $1.0 billion a year ago. Net income available to
common shareholders was $58.8 million, or $0.52 per diluted common
share, compared with $141.8 million, or $1.21 per diluted common
share for the third quarter of 2022. Non-GAAP net income available
to common shareholders was $67.4 million, or $0.60 per diluted
common share for the third quarter of 2023.
Ronald J. Kruszewski, Chairman
and Chief Executive Officer, said “Stifel generated a solid quarter
despite challenging market conditions. Our bottom line was impacted
by non-recurring legal accruals, primarily associated with an
industry-wide SEC review of off-channel communications that totaled
$0.58 per diluted common share, after tax. Excluding the impact of
these charges, our results are consistent with those in the
sequential and year-ago quarters. Although the near-term
environment remains uncertain, we remain well positioned to
generate stable returns and strong growth as the market
improves.”
Highlights
- The Company reported net revenues
of $1.05 billion as our business navigated an environment that
remains challenging.
- Non-GAAP net income available to
common shareholders of $0.60 per diluted common share was
negatively impacted by elevated provisions for legal and regulatory
matters of $0.58 per diluted common share (after-tax).
- Net interest income up $40.2
million, or 17%, over the year-ago quarter.
- Recruited 36 financial advisors
during the quarter, including 24 experienced employee
advisors.
- Non-GAAP pre-tax margin of 12% was
negatively impacted by elevated provisions for legal and regulatory
matters.
- Annualized return on tangible
common equity (ROTCE) (5) of 9%.
- Tangible book value per common
share (7) of $30.06, up 2% from prior year.
- The Board of Directors approved an
increase to the Company’s share repurchase program of an additional
10.0 million shares, bringing the authorized share repurchase
amount to 14.2 million shares.
Financial Summary (Unaudited) |
(000s) |
3Q 2023 |
3Q 2022 |
9m 2023 |
9m 2022 |
GAAP Financial Highlights: |
|
|
|
Net revenues |
$ |
1,045,051 |
|
$ |
1,045,139 |
|
$ |
3,202,565 |
|
$ |
3,269,792 |
|
Net income (1) |
$ |
58,840 |
|
$ |
141,849 |
|
$ |
332,091 |
|
$ |
457,573 |
|
Diluted EPS (1) |
$ |
0.52 |
|
$ |
1.21 |
|
$ |
2.91 |
|
$ |
3.89 |
|
Comp. ratio |
|
58.7 |
% |
|
58.5 |
% |
|
58.7 |
% |
|
59.3 |
% |
Non-comp. ratio |
|
30.8 |
% |
|
21.8 |
% |
|
25.7 |
% |
|
20.8 |
% |
Pre-tax
margin |
|
10.5 |
% |
|
19.7 |
% |
|
15.6 |
% |
|
19.9 |
% |
Non-GAAP Financial Highlights: |
|
|
|
Net revenues |
$ |
1,045,028 |
|
$ |
1,045,133 |
|
$ |
3,202,539 |
|
$ |
3,269,847 |
|
Net income (1) (2) |
$ |
67,413 |
|
$ |
150,756 |
|
$ |
364,937 |
|
$ |
490,196 |
|
Diluted EPS (1) (2) |
$ |
0.60 |
|
$ |
1.29 |
|
$ |
3.20 |
|
$ |
4.17 |
|
Comp. ratio (2) |
|
58.0 |
% |
|
58.0 |
% |
|
58.0 |
% |
|
58.5 |
% |
Non-comp. ratio (2) |
|
30.2 |
% |
|
21.2 |
% |
|
24.9 |
% |
|
20.2 |
% |
Pre-tax margin (3) |
|
11.8 |
% |
|
20.8 |
% |
|
17.1 |
% |
|
21.3 |
% |
ROCE (4) |
|
5.8 |
% |
|
13.3 |
% |
|
10.4 |
% |
|
14.7 |
% |
ROTCE
(5) |
|
8.5 |
% |
|
19.2 |
% |
|
15.1 |
% |
|
21.5 |
% |
Global Wealth Management (assets and loans
in millions) |
|
Net revenues |
$ |
768,558 |
|
$ |
701,820 |
|
$ |
2,283,934 |
|
$ |
2,081,525 |
|
Pre-tax net income |
$ |
298,449 |
|
$ |
279,935 |
|
$ |
914,462 |
|
$ |
750,500 |
|
Total client assets |
$ |
412,458 |
|
$ |
364,824 |
|
|
|
Fee-based client assets |
$ |
150,982 |
|
$ |
135,521 |
|
|
|
Bank
loans (6) |
$ |
20,435 |
|
$ |
20,911 |
|
|
|
Institutional Group |
|
|
|
|
Net revenues |
$ |
256,888 |
|
$ |
339,408 |
|
$ |
867,025 |
|
$ |
1,182,135 |
|
Equity |
$ |
144,764 |
|
$ |
223,147 |
|
$ |
508,371 |
|
$ |
715,474 |
|
Fixed Income |
$ |
112,124 |
|
$ |
116,261 |
|
$ |
358,654 |
|
$ |
466,661 |
|
Pre-tax
net income/ (loss) |
$ |
(27,804 |
) |
$ |
40,000 |
|
$ |
(5,671 |
) |
$ |
209,620 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Global Wealth Management
Global Wealth Management reported record net
revenues of $768.6 million for the three months ended September 30,
2023 compared with $701.8 million during the third quarter of 2022.
Pre-tax net income was $298.4 million compared with $279.9 million
in the third quarter of 2022.
Highlights
- Recruited 36
financial advisors during the quarter, including 24 experienced
employee advisors with total trailing 12 month production of $24
million.
- Client assets of
$412.5 billion, up 13% over the year-ago quarter.
- Fee-based client
assets of $151.0 billion, up 11% over the year-ago quarter.
Net revenues increased 10% from a year
ago:
- Transactional
revenues increased 6% from the year-ago quarter reflecting an
increase in client activity.
- Asset management
revenues increased 11% from the year-ago quarter primarily due to
higher asset values.
- Net interest income
increased 11% over the year-ago quarter primarily driven by higher
interest rates.
Total Expenses:
- Compensation expense
as a percent of net revenues increased to 46.8% primarily as a
result of higher compensable revenues.
- Provision for credit
losses was primarily impacted by a deterioration in certain asset
classes, partially offset by a slightly better macroeconomic
forecast.
- Non-compensation
operating expenses as a percent of net revenues increased to 14.4%
primarily as a result of an increase in the provision for credit
losses over the year-ago quarter, partially offset by revenue
growth.
Summary Results of Operations |
(000s) |
|
3Q 2023 |
|
|
3Q 2022 |
|
Net revenues |
$ |
768,558 |
|
$ |
701,820 |
|
Transactional revenues |
|
165,547 |
|
|
156,565 |
|
Asset management |
|
333,088 |
|
|
300,540 |
|
Net interest income |
|
269,431 |
|
|
242,194 |
|
Investment banking |
|
3,895 |
|
|
4,498 |
|
Other
income |
|
(3,403 |
) |
|
(1,977 |
) |
Total expenses |
$ |
470,109 |
|
$ |
421,885 |
|
Compensation expense |
|
359,325 |
|
|
326,116 |
|
Provision for credit
losses |
|
9,992 |
|
|
6,453 |
|
Non-comp. opex |
|
100,792 |
|
|
89,316 |
|
Pre-tax net income |
$ |
298,449 |
|
$ |
279,935 |
|
Compensation ratio |
|
46.8 |
% |
|
46.5 |
% |
Non-compensation ratio |
|
14.4 |
% |
|
13.6 |
% |
Pre-tax margin |
|
38.8 |
% |
|
39.9 |
% |
|
|
|
|
|
|
|
Institutional Group
Institutional Group reported net revenues of
$256.9 million for the three months ended September 30, 2023
compared with $339.4 million during the third quarter of 2022.
Institutional Group reported pre-tax net loss of $27.8 million for
the three months ended September 30, 2023 compared with pre-tax net
income of $40.0 million in the third quarter of 2022.
Highlights
Investment banking revenues decreased 34%
from a year ago:
- Advisory revenues of
$97.3 million decreased 42% from the year-ago quarter driven by
lower levels of completed advisory transactions.
- Equity capital
raising revenues decreased 12% over the year-ago quarter driven by
lower volumes.
- Fixed income capital
raising revenues decreased 8% over the year-ago quarter
as macroeconomic conditions contributed to lower municipal
bond and debt issuances.
Fixed income transactional revenues
decreased 9% from a year ago:
- Fixed income
transactional revenues decreased from the year-ago quarter driven
by declines across most products as a result of lower volumes and
lower market volatility compared with elevated levels in the prior
year period, partially offset by higher trading gains.
Equity transactional revenues increased 1%
from a year ago:
- Equity transactional
revenues increased from the year-ago quarter driven by an increase
in equities trading commissions, partially offset by lower trading
gains.
Total Expenses:
- Compensation expense
as a percent of net revenues increased to 75.0% primarily as a
result of lower net revenues, partially offset by lower
discretionary compensation.
- Non-compensation
operating expenses as a percent of net revenues increased to 35.8%
as a result of lower net revenues, higher travel-related expenses,
occupancy costs, and professional fees, as well as continued
investments in technology, partially offset by lower investment
banking transaction expenses.
Summary Results of Operations |
(000s) |
|
3Q 2023 |
|
|
3Q 2022 |
|
Net
revenues |
$ |
256,888 |
|
$ |
339,408 |
|
Investment banking |
|
142,991 |
|
|
217,361 |
|
Advisory |
|
97,272 |
|
|
166,736 |
|
Equity capital raising |
|
21,049 |
|
|
23,883 |
|
Fixed income capital
raising |
|
24,670 |
|
|
26,742 |
|
Fixed income
transactional |
|
67,439 |
|
|
74,384 |
|
Equity transactional |
|
46,930 |
|
|
46,483 |
|
Other |
|
(472 |
) |
|
1,180 |
|
Total
expenses |
$ |
284,692 |
|
$ |
299,408 |
|
Compensation expense |
|
192,638 |
|
|
211,818 |
|
Non-comp. opex. |
|
92,054 |
|
|
87,590 |
|
Pre-tax net income/(loss) |
$ |
(27,804 |
) |
$ |
40,000 |
|
Compensation ratio |
|
75.0 |
% |
|
62.4 |
% |
Non-compensation ratio |
|
35.8 |
% |
|
25.8 |
% |
Pre-tax margin |
|
(10.8 |
%) |
|
11.8 |
% |
|
|
|
|
|
|
|
Other Matters
Highlights
- Total assets increased $265.5
million, or 1%, over the year-ago quarter.
- The Company repurchased $118.8
million of its outstanding common stock during the third
quarter.
- Weighted average diluted shares
outstanding decreased primarily as a result of the increase in
share repurchases over the comparable period.
- The Board of Directors declared a
$0.36 quarterly dividend per share payable on September 15, 2023 to
common shareholders of record on September 1, 2023.
- The Board of Directors declared a
quarterly dividend on the outstanding shares of the Company’s
preferred stock payable on September 15, 2023 to shareholders of
record on September 1, 2023.
|
3Q 2023 |
3Q 2022 |
Common stock repurchases |
|
|
Repurchases (000s) |
$ |
118,810 |
|
$ |
0 |
|
Number of shares (000s) |
|
1,886 |
|
|
0 |
|
Average price |
$ |
63.00 |
|
|
NA |
|
Period end shares (000s) |
|
103,120 |
|
|
106,225 |
|
Weighted average diluted shares outstanding (000s) |
|
113,195 |
|
|
117,218 |
|
Effective tax rate |
|
37.7 |
% |
|
26.5 |
% |
Stifel Financial Corp. (8) |
|
|
Tier 1 common capital
ratio |
|
13.9 |
% |
|
14.1 |
% |
Tier 1 risk based capital
ratio |
|
16.9 |
% |
|
17.0 |
% |
Tier 1 leverage capital
ratio |
|
10.8 |
% |
|
11.1 |
% |
Tier 1 capital (MM) |
$ |
3,914 |
|
$ |
3,964 |
|
Risk weighted assets (MM) |
$ |
23,219 |
|
$ |
23,300 |
|
Average assets (MM) |
$ |
36,356 |
|
$ |
35,620 |
|
Quarter
end assets (MM) |
$ |
37,878 |
|
$ |
37,612 |
|
Agency |
Rating |
Outlook |
Fitch Ratings |
BBB+ |
Stable |
S&P
Global Ratings |
BBB- |
Positive |
Conference Call Information
Stifel Financial Corp. will host its
third quarter 2023 financial results conference call on Wednesday,
October 25, 2023, at 9:30 a.m. Eastern Time. The
conference call may include forward-looking statements.
All interested parties are invited to listen to
Stifel’s Chairman and CEO, Ronald J. Kruszewski, by dialing (866)
409-1555 and referencing conference ID 4717221. 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, including its Eaton Partners and
Miller Buckfire business divisions; Keefe, Bruyette & Woods,
Inc.; and Stifel Independent Advisors, LLC; in Canada through
Stifel Nicolaus Canada Inc.; and in the United Kingdom and Europe
through Stifel Nicolaus Europe Limited. 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 and Stifel Bank & Trust offer a
full range of consumer and commercial lending solutions. Stifel
Trust Company, N.A. and Stifel Trust Company Delaware, N.A. offer
trust and related services. To learn more about Stifel, please
visit the Company’s website at www.stifel.com. For global
disclosures, please visit
www.stifel.com/investor-relations/press-releases.
A financial summary follows. Financial,
statistical and business-related information, as well as
information regarding business and segment trends, is included in
the financial supplement. Both the earnings release and the
financial supplement are available online in the Investor Relations
section at www.stifel.com/investor-relations.
The information provided herein and in the
financial supplement, including information provided on the
Company’s earnings conference calls, may include certain non-GAAP
financial measures. The definition of such measures or
reconciliation of such measures to the comparable U.S. GAAP figures
are included in this earnings release and the financial supplement,
both of which are available online in the Investor Relations
section at www.stifel.com/investor-relations.
Cautionary Note Regarding 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. For information about the
risks and important factors that could affect the Company’s future
results, financial condition and liquidity, see “Risk Factors” in
Part I, Item 1A of the Company’s Annual Report on Form 10-K for the
year ended December 31, 2022. Forward-looking statements speak only
as to the date they are made. The Company 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.
Summary Results of Operations
(Unaudited)
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
(000s, except per share amounts) |
9/30/2023 |
9/30/2022 |
% Change |
6/30/2023 |
% Change |
9/30/2023 |
9/30/2022 |
% Change |
Revenues: |
|
|
|
|
|
|
|
|
Commissions |
$ |
165,075 |
$ |
159,054 |
3.8 |
|
$ |
165,358 |
(0.2 |
) |
$ |
499,983 |
|
$ |
541,644 |
(7.7 |
) |
Principal transactions |
|
114,841 |
|
118,379 |
(3.0 |
) |
|
105,700 |
8.6 |
|
|
336,063 |
|
|
403,252 |
(16.7 |
) |
Investment banking |
|
146,887 |
|
221,858 |
(33.8 |
) |
|
166,825 |
(12.0 |
) |
|
525,591 |
|
|
747,779 |
(29.7 |
) |
Asset management |
|
333,127 |
|
300,557 |
10.8 |
|
|
320,264 |
4.0 |
|
|
968,960 |
|
|
973,457 |
(0.5 |
) |
Other income |
|
459 |
|
852 |
(46.1 |
) |
|
894 |
(48.7 |
) |
|
(940 |
) |
|
7,823 |
(112.0 |
) |
Operating
revenues |
|
760,389 |
|
800,700 |
(5.0 |
) |
|
759,041 |
0.2 |
|
|
2,329,657 |
|
|
2,673,955 |
(12.9 |
) |
Interest revenue |
|
505,198 |
|
304,195 |
66.1 |
|
|
482,770 |
4.6 |
|
|
1,439,532 |
|
|
682,384 |
111.0 |
|
Total
revenues |
|
1,265,587 |
|
1,104,895 |
14.5 |
|
|
1,241,811 |
1.9 |
|
|
3,769,189 |
|
|
3,356,339 |
12.3 |
|
Interest expense |
|
220,536 |
|
59,756 |
269.1 |
|
|
191,090 |
15.4 |
|
|
566,624 |
|
|
86,547 |
554.7 |
|
Net
revenues |
|
1,045,051 |
|
1,045,139 |
(0.0 |
) |
|
1,050,721 |
(0.5 |
) |
|
3,202,565 |
|
|
3,269,792 |
(2.1 |
) |
Non-interest
expenses: |
|
|
|
|
|
|
|
|
Compensation and benefits |
|
613,287 |
|
611,870 |
0.2 |
|
|
615,667 |
(0.4 |
) |
|
1,880,144 |
|
|
1,938,270 |
(3.0 |
) |
Non-compensation operating
expenses |
|
322,335 |
|
227,500 |
41.7 |
|
|
253,669 |
27.1 |
|
|
821,724 |
|
|
680,103 |
20.8 |
|
Total non-interest
expenses |
|
935,622 |
|
839,370 |
11.5 |
|
|
869,336 |
7.6 |
|
|
2,701,868 |
|
|
2,618,373 |
3.2 |
|
Income before income
taxes |
|
109,429 |
|
205,769 |
(46.8 |
) |
|
181,385 |
(39.7 |
) |
|
500,697 |
|
|
651,419 |
(23.1 |
) |
Provision for income
taxes |
|
41,268 |
|
54,600 |
(24.4 |
) |
|
47,033 |
(12.3 |
) |
|
140,645 |
|
|
165,885 |
(15.2 |
) |
Net
income |
|
68,161 |
|
151,169 |
(54.9 |
) |
|
134,352 |
(49.3 |
) |
|
360,052 |
|
|
485,534 |
(25.8 |
) |
Preferred dividends |
|
9,321 |
|
9,320 |
0.0 |
|
|
9,320 |
0.0 |
|
|
27,961 |
|
|
27,961 |
0.0 |
|
Net income available
to common shareholders |
$ |
58,840 |
$ |
141,849 |
(58.5 |
) |
$ |
125,032 |
(52.9 |
) |
$ |
332,091 |
|
$ |
457,573 |
(27.4 |
) |
Earnings per common
share: |
|
|
|
|
|
|
|
|
Basic |
$ |
0.55 |
$ |
1.30 |
(57.7 |
) |
$ |
1.16 |
(52.6 |
) |
$ |
3.09 |
|
$ |
4.20 |
(26.4 |
) |
Diluted |
$ |
0.52 |
$ |
1.21 |
(57.0 |
) |
$ |
1.10 |
(52.7 |
) |
$ |
2.91 |
|
$ |
3.89 |
(25.2 |
) |
Cash dividends
declared per common share |
$ |
0.36 |
$ |
0.30 |
20.0 |
|
$ |
0.36 |
0.0 |
|
$ |
1.08 |
|
$ |
0.90 |
20.0 |
|
Weighted
average number of common shares outstanding: |
|
|
|
|
|
Basic |
|
106,068 |
|
108,767 |
(2.5 |
) |
|
107,944 |
(1.7 |
) |
|
107,580 |
|
|
109,017 |
(1.3 |
) |
Diluted |
|
113,195 |
|
117,218 |
(3.4 |
) |
|
113,864 |
(0.6 |
) |
|
114,170 |
|
|
117,649 |
(3.0 |
) |
Non-GAAP Financial Measures
(9)
|
|
|
|
Three Months Ended |
Nine Months Ended |
(000s, except per share
amounts) |
9/30/2023 |
9/30/2022 |
9/30/2023 |
9/30/2022 |
GAAP net income |
$ |
68,161 |
|
$ |
151,169 |
|
$ |
360,052 |
|
$ |
485,534 |
|
Preferred dividend |
|
9,321 |
|
|
9,320 |
|
|
27,961 |
|
|
27,961 |
|
Net income available
to common shareholders |
|
58,840 |
|
|
141,849 |
|
|
332,091 |
|
|
457,573 |
|
|
|
|
|
|
Non-GAAP adjustments: |
|
|
|
|
Merger-related (10) |
|
13,771 |
|
|
11,958 |
|
|
46,301 |
|
|
43,602 |
|
Provision for income taxes
(11) |
|
(5,198 |
) |
|
(3,051 |
) |
|
(13,455 |
) |
|
(10,979 |
) |
Total non-GAAP
adjustments |
|
8,573 |
|
|
8,907 |
|
|
32,846 |
|
|
32,623 |
|
Non-GAAP net income
available to common shareholders |
$ |
67,413 |
|
$ |
150,756 |
|
$ |
364,937 |
|
$ |
490,196 |
|
|
|
|
|
|
Weighted average diluted
shares outstanding |
|
113,195 |
|
|
117,218 |
|
|
114,170 |
|
|
117,649 |
|
|
|
|
|
|
GAAP earnings per diluted
common share |
$ |
0.60 |
|
$ |
1.29 |
|
$ |
3.15 |
|
$ |
4.13 |
|
Non-GAAP adjustments |
|
0.08 |
|
|
0.08 |
|
|
0.29 |
|
|
0.28 |
|
Non-GAAP earnings per diluted
common share |
$ |
0.68 |
|
$ |
1.37 |
|
$ |
3.44 |
|
$ |
4.41 |
|
|
|
|
|
|
GAAP earnings per diluted
common share available to common shareholders |
$ |
0.52 |
|
$ |
1.21 |
|
$ |
2.91 |
|
$ |
3.89 |
|
Non-GAAP adjustments |
|
0.08 |
|
|
0.08 |
|
|
0.29 |
|
|
0.28 |
|
Non-GAAP earnings per diluted common share available to common
shareholders |
$ |
0.60 |
|
$ |
1.29 |
|
$ |
3.20 |
|
$ |
4.17 |
|
GAAP to Non-GAAP Reconciliation
(9)
|
|
|
|
Three Months Ended |
Nine Months Ended |
(000s) |
9/30/2023 |
9/30/2022 |
9/30/2023 |
9/30/2022 |
GAAP compensation and benefits |
$ |
613,287 |
|
$ |
611,870 |
|
$ |
1,880,144 |
|
$ |
1,938,270 |
|
As a percentage of net
revenues |
|
58.7 |
% |
|
58.5 |
% |
|
58.7 |
% |
|
59.3 |
% |
Non-GAAP adjustments: |
|
|
|
|
Merger-related (10) |
|
(7,171 |
) |
|
(6,059 |
) |
|
(22,947 |
) |
|
(24,544 |
) |
Non-GAAP compensation
and benefits |
$ |
606,116 |
|
$ |
605,811 |
|
$ |
1,857,197 |
|
$ |
1,913,726 |
|
As a percentage of non-GAAP
net revenues |
|
58.0 |
% |
|
58.0 |
% |
|
58.0 |
% |
|
58.5 |
% |
|
|
|
|
|
GAAP non-compensation
expenses |
$ |
322,335 |
|
$ |
227,500 |
|
$ |
821,724 |
|
$ |
680,103 |
|
As a percentage of net
revenues |
|
30.8 |
% |
|
21.8 |
% |
|
25.7 |
% |
|
20.8 |
% |
Non-GAAP adjustments: |
|
|
|
|
Merger-related (10) |
|
(6,623 |
) |
|
(5,905 |
) |
|
(23,380 |
) |
|
(19,003 |
) |
Non-GAAP
non-compensation expenses |
$ |
315,712 |
|
$ |
221,595 |
|
$ |
798,344 |
|
$ |
661,100 |
|
As a percentage of non-GAAP
net revenues |
|
30.2 |
% |
|
21.2 |
% |
|
24.9 |
% |
|
20.2 |
% |
Total merger-related expenses |
$ |
13,771 |
|
$ |
11,958 |
|
$ |
46,301 |
|
$ |
43,602 |
|
Footnotes
(1) Represents available to common
shareholders.
(2) Reconciliations of the Company’s GAAP
results to these non-GAAP measures are discussed within and under
“Non-GAAP Financial Measures” and “GAAP to Non-GAAP
Reconciliation.”
(3) Non-GAAP pre-tax margin is calculated
by adding total merger-related expenses (non-GAAP adjustments) and
dividing it by non-GAAP net revenues. See “Non-GAAP Financial
Measures” and “GAAP to Non-GAAP Reconciliation.”
(4) Return on average common equity
(“ROCE”) is calculated by dividing annualized net income applicable
to common shareholders by average common shareholders’ equity or,
in the case of non-GAAP ROCE, calculated by dividing non-GAAP net
income applicable to commons shareholders by average common
shareholders’ equity.
(5) Return on average tangible common
equity (“ROTCE”) is calculated by dividing annualized net income
applicable to common shareholders by average tangible shareholders’
equity or, in the case of non-GAAP ROTCE, calculated by dividing
non-GAAP net income applicable to common shareholders by average
tangible common equity. Tangible common equity, also a non-GAAP
financial measure, equals total common shareholders’ equity less
goodwill and identifiable intangible assets and the deferred taxes
on goodwill and intangible assets. Average deferred taxes on
goodwill and intangible assets was $67.4 million and $59.2 million
as of September 30, 2023 and 2022, respectively.
(6) Includes loans held for sale.
(7) Tangible book value per common share
represents shareholders’ equity (excluding preferred stock) divided
by period end common shares outstanding. Tangible common
shareholders’ equity equals total common shareholders’ equity less
goodwill and identifiable intangible assets and the deferred taxes
on goodwill and intangible assets.
(8) Capital ratios are estimates at time of
the Company’s earnings release, October 25, 2023.
(9) The Company prepares its Consolidated
Financial Statements using accounting principles generally accepted
in the United States (U.S. GAAP). The Company may disclose certain
“non-GAAP financial measures” in the course of its earnings
releases, earnings conference calls, financial presentations and
otherwise. The Securities and Exchange Commission defines a
“non-GAAP financial measure” as a numerical measure of historical
or future financial performance, financial position, or cash flows
that is subject to adjustments that effectively exclude, or
include, amounts from the most directly comparable measure
calculated and presented in accordance with U.S. GAAP. Non-GAAP
financial measures disclosed by the Company are provided as
additional information to analysts, investors and other
stakeholders in order to provide them with greater transparency
about, or an alternative method for assessing the Company’s
financial condition or operating results. These measures are not in
accordance with, or a substitute for U.S. GAAP, and may be
different from or inconsistent with non-GAAP financial measures
used by other companies. Whenever the Company refers to a non-GAAP
financial measure, it will also define it or present the most
directly comparable financial measure calculated and presented in
accordance with U.S. GAAP, along with a reconciliation of the
differences between the non-GAAP financial measure it references
and such comparable U.S. GAAP financial measure.
(10) Primarily related to charges
attributable to integration-related activities, signing bonuses,
amortization of restricted stock awards, debentures, and promissory
notes issued as retention, additional earn-out expense, and
amortization of intangible assets acquired. These costs were
directly related to acquisitions of certain businesses and are not
representative of the costs of running the Company’s on-going
business.
(11) Primarily represents the Company’s
effective tax rate for the period applied to the non-GAAP
adjustments.
Media Contact: Neil Shapiro (212) 271-3447 |
Investor Contact: Joel Jeffrey (212) 271- 3610 |
www.stifel.com/investor-relations
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