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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Oppenheimer Holdings Inc | NYSE:OPY | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 40.83 | 0 | 09:09:32 |
NEW YORK, Jan. 29, 2021 /PRNewswire/ - Oppenheimer Holdings Inc. (NYSE: OPY) (the "Company" or "Firm") today reported net income of $81.9 million or $6.56 basic earnings per share for the fourth quarter of 2020 compared with net income of $25.4 million or $1.99 basic earnings per share for the fourth quarter of 2019. Revenue for the fourth quarter of 2020 was $422.9 million compared to revenue of $295.9 million for the fourth quarter of 2019, an increase of 42.9%.
For the year ended December 31, 2020, the Company reported net income of $123.0 million or $9.73 basic net income per share compared with net income of $53.0 million or $4.10 basic net income per share for the year ended December 31, 2019. Revenue for the year ended December 31, 2020 was $1.2 billion compared to revenue of $1.0 billion for the year ended December 31, 2019, an increase of 16.0%.
Summary Operating Results (Unaudited) | ||||||||||||
('000s, except per share amounts or otherwise indicated) | ||||||||||||
Firm | 4Q-20 | 4Q-19 | FY-20 | FY-19 | ||||||||
Revenue | $ | 422,908 | $ | 295,881 | $ | 1,198,667 | $ | 1,033,379 | ||||
Compensation Expense | $ | 244,073 | $ | 190,292 | $ | 770,997 | $ | 657,714 | ||||
Non-compensation Expense | $ | 65,040 | $ | 70,616 | $ | 258,670 | $ | 300,753 | ||||
Pre-Tax Income | $ | 113,795 | $ | 34,973 | $ | 169,000 | $ | 74,912 | ||||
Income Taxes | $ | 31,915 | $ | 9,538 | $ | 46,014 | $ | 21,959 | ||||
Net Income | $ | 81,880 | $ | 25,435 | $ | 122,986 | $ | 52,953 | ||||
Earnings Per Share - Basic | $ | 6.56 | $ | 1.99 | $ | 9.73 | $ | 4.10 | ||||
Earnings Per Share - Diluted | $ | 6.17 | $ | 1.84 | $ | 9.30 | $ | 3.82 | ||||
Book Value Per Share | $ | 54.93 | $ | 46.31 | $ | 54.93 | $ | 46.31 | ||||
Tangible Book Value Per Share (1) | $ | 41.31 | $ | 33.03 | $ | 41.31 | $ | 33.03 | ||||
(1) Represents book value less goodwill and intangible assets divided by number of shares outstanding |
Annual Highlights
Albert G. Lowenthal, Chairman and CEO commented, "The results for the fourth quarter and full year 2020 were outstanding and really showcased the strength of the platform and the dedication and commitment from our employees throughout this COVID-19 impacted year. The combination of a low interest rate environment, high volatility, and a robust rally in equities over the last nine months provided the impetus for extremely favorable results for the year. Our Capital Markets business continued to outperform with a record quarter and year for revenue and earnings, while the Wealth Management business continued to produce solid operating returns based on increased commission activity and higher fee income from assets under management. The Wealth Management business got a significant boost from the record performance of the hedge funds that we sponsor which led to an increase in incentive fees from alternative investments in the fourth quarter of 2020 which are measured and earned at the end of each year.
Investment banking had its best quarter ever as the Firm increased its market share during a robust period for equities issuance in the U.S. capital markets. M&A activity also picked up significantly during the fourth quarter with several notable advisory and placement fees. Equities and fixed income sales and trading activity continued to be brisk as volatility remained elevated during the period. The broader equities markets finished the year at record levels and were up 11.7% during the fourth quarter contributing to record assets under management at December 31, 2020, which will drive our advisory fee revenue for the first quarter of 2021.
Non-compensation expenses remained under close control and we were able to manage our operating environment throughout this year of remote work. At year-end we continued to operate with about 90% of our employees working from home amid the increase in the reported infection rate from COVID-19. We look forward to the return to some level of normalcy by the third quarter of 2021 as the rate of vaccination increases in the U.S. and around the world."
Segment Results (Unaudited) | ||||||||||||
('000s, except per share amounts or otherwise indicated) | ||||||||||||
4Q-20 | 4Q-19 | FY-20 | FY-19 | |||||||||
Private Client | ||||||||||||
Revenue | $ | 217,743 | $ | 175,900 | $ | 642,083 | $ | 653,409 | ||||
Pre-Tax Income | $ | 39,362 | $ | 42,416 | $ | 122,844 | $ | 163,917 | ||||
Assets Under Administration ($Bn) | $ | 104.8 | $ | 91.0 | $ | 104.8 | $ | 91.0 | ||||
Asset Management | ||||||||||||
Revenue | $ | 72,851 | $ | 35,179 | $ | 130,274 | $ | 88,755 | ||||
Pre-Tax Income | $ | 56,911 | $ | 19,114 | $ | 71,625 | $ | 31,606 | ||||
Asset Under Management ($Bn) | $ | 38.8 | $ | 32.1 | $ | 38.8 | $ | 32.1 | ||||
Capital Markets | ||||||||||||
Revenue | $ | 131,651 | $ | 83,982 | $ | 426,752 | $ | 290,830 | ||||
Pre-Tax Income (Loss) | $ | 41,894 | $ | (2,891) | $ | 83,442 | $ | (13,724) |
Fourth Quarter Results
Private Client
Private Client reported revenue of $217.7 million for the fourth quarter of 2020, 23.8% higher compared with a year ago. Increased revenue reflected a marked increase in the transaction business, particularly in listed options as clients were encouraged by increased volatility and a particularly strong equities market, which also contributed to record high incentive fees. Pre-tax income of $39.4 million in the current quarter resulted in a pre-tax profit margin of 18.1%. Financial advisor headcount declined amid increased retirements to 1,002 at the end of the current quarter compared to 1,032 at the end of fourth quarter of 2019, although the productivity of our financial advisors increased significantly reflecting higher individual production levels.
('000s, except otherwise indicated) | ||||||
4Q-20 | 4Q-19 | |||||
Revenue | $ | 217,743 | $ | 175,900 | ||
Commissions | $ | 53,383 | $ | 48,407 | ||
Advisory Fees | $ | 133,562 | $ | 83,205 | ||
Bank Deposit Sweep Income | $ | 4,262 | $ | 22,729 | ||
Interest | $ | 6,393 | $ | 8,110 | ||
Other | $ | 20,143 | $ | 13,449 | ||
Total Expenses | $ | 178,381 | $ | 133,484 | ||
Compensation | $ | 151,774 | $ | 103,649 | ||
Non-compensation | $ | 26,607 | $ | 29,835 | ||
Assets Under Administration ($Bn) | $ | 104.8 | $ | 91.0 | ||
Cash Sweep Balances ($Bn) | $ | 7.3 | $ | 4.9 |
Revenue:
Total Expenses:
Asset Management
Asset Management reported revenue of $72.9 million for the fourth quarter of 2020, 107.1% higher compared with a year ago. Pre-tax income was $56.9 million, an increase of 197.7% compared with a year ago.
('000s, except otherwise indicated) | ||||||
4Q-20 | 4Q-19 | |||||
Revenue | $ | 72,851 | $ | 35,179 | ||
Advisory Fees | $ | 70,847 | $ | 35,176 | ||
Other | $ | 2,004 | $ | 3 | ||
Total Expenses | $ | 15,940 | $ | 16,065 | ||
Compensation | $ | 7,104 | $ | 7,806 | ||
Non-compensation | $ | 8,836 | $ | 8,259 | ||
AUM ($Bn) | $ | 38.8 | $ | 32.1 |
Revenue:
Assets under Management (AUM):
Total Expenses:
Capital Markets
Capital Markets reported revenue of $131.7 million for the fourth quarter of 2020, 56.8% higher compared with a year ago. Pre-Tax income was $41.9 million compared with a pre-tax loss of $2.9 million a year ago.
('000s) | ||||||
4Q-20 | 4Q-19 | |||||
Revenue | $ | 131,651 | $ | 83,982 | ||
Investment Banking | $ | 78,048 | $ | 40,633 | ||
Advisory Fees | $ | 32,749 | $ | 13,211 | ||
Equities Underwriting | $ | 39,205 | $ | 12,916 | ||
Fixed Income Underwriting | $ | 5,474 | $ | 14,281 | ||
Other | $ | 620 | $ | 225 | ||
Sales and Trading | $ | 52,723 | $ | 42,903 | ||
Equities | $ | 34,546 | $ | 24,859 | ||
Fixed Income | $ | 18,177 | $ | 18,044 | ||
Other | $ | 880 | $ | 446 | ||
Total Expenses | $ | 89,757 | $ | 86,873 | ||
Compensation | $ | 67,070 | $ | 59,911 | ||
Non-compensation | $ | 22,687 | $ | 26,962 |
Revenue:
Investment Banking
Sales and Trading
Total Expenses:
Full Year Results
Private Client
Private Client reported revenue of $642.1 million for the year ended December 31, 2020, 1.7% lower compared with a year ago. Pre-tax income of $122.8 million in the year end resulted in a pre-tax profit margin of 19.1%.
('000s) | ||||||
FY-20 | FY-19 | |||||
Revenue | $ | 642,083 | $ | 653,409 | ||
Commissions | $ | 209,447 | $ | 188,690 | ||
Advisory Fees | $ | 326,858 | $ | 264,839 | ||
Bank Deposit Sweep Income | $ | 34,829 | $ | 117,422 | ||
Interest | $ | 25,148 | $ | 35,811 | ||
Other | $ | 45,801 | $ | 46,647 | ||
Total Expenses | $ | 519,239 | $ | 489,492 | ||
Compensation | $ | 412,021 | $ | 362,665 | ||
Non-compensation | $ | 107,218 | $ | 126,827 |
Revenue:
Total Expenses:
Asset Management
Asset Management reported revenue of $130.3 million for the year ended December 31, 2020, 46.8% higher compared with a year ago. Pre-tax income was $71.6 million, an increase of 126.6% compared with a year ago.
('000s) | ||||||
FY-20 | FY-19 | |||||
Revenue | $ | 130,274 | $ | 88,755 | ||
Advisory Fees | $ | 128,258 | $ | 88,748 | ||
Other | $ | 2,016 | $ | 7 | ||
Total Expenses | $ | 58,649 | $ | 57,149 | ||
Compensation | $ | 25,128 | $ | 25,180 | ||
Non-compensation | $ | 33,521 | $ | 31,969 | ||
AUM ($Bn) | $ | 38.8 | $ | 32.1 |
Revenue:
Assets under Management (AUM):
Total Expenses:
Capital Markets
Capital Markets reported revenue of $426.8 million for the year ended December 31, 2020, 46.7% higher compared with a year ago. Pre-Tax income was $83.4 million compared with a pre-tax loss of $13.7 million a year ago.
('000s) | ||||||
FY-20 | FY-19 | |||||
Revenue | $ | 426,752 | $ | 290,830 | ||
Investment Banking | $ | 206,098 | $ | 113,369 | ||
Advisory Fees | $ | 80,534 | $ | 53,424 | ||
Equities Underwriting | $ | 103,276 | $ | 40,813 | ||
Fixed Income Underwriting | $ | 20,394 | $ | 18,447 | ||
Other | $ | 1,894 | $ | 685 | ||
Sales and Trading | $ | 217,711 | $ | 175,616 | ||
Equities | $ | 130,668 | $ | 99,848 | ||
Fixed Income | $ | 87,043 | $ | 75,768 | ||
Other | $ | 2,943 | $ | 1,845 | ||
Total Expenses | $ | 343,310 | $ | 304,554 | ||
Compensation | $ | 251,697 | $ | 193,861 | ||
Non-compensation | $ | 91,613 | $ | 110,693 |
Revenue:
Investment Banking
Sales and Trading
Total Expenses:
Other Matters
(In millions, except percentages, number of shares and per share | ||||||
FY-20 | FY-19 | |||||
Capital | ||||||
Senior Secured Notes | $ | 123.8 | $ | 149.5 | ||
Shareholders' Equity | $ | 685.6 | $ | 592.7 | ||
Regulatory Net Capital (1) | $ | 274.5 | $ | 223.4 | ||
Regulatory Excess Net Capital (1) | $ | 250.1 | $ | 206.7 | ||
Common Stock Repurchases | ||||||
Repurchases | $ | 15.0 | $ | 8.4 | ||
Number of Shares | 718,522 | 323,249 | ||||
Average Price | $ | 20.94 | $ | 25.99 | ||
Period End Shares | 12,481,443 | 12,798,368 | ||||
Effective Tax Rate | 27.2 | % | 29.3 | % | ||
(1) Attributable to Oppenheimer & Co. Inc. broker-dealer |
Coronavirus Pandemic ("COVID-19")
The Company continues to monitor the effects of the pandemic both on a national level as well as regionally and locally and is responding accordingly. In addition, we continue to provide frequent communications to clients, employees, and regulators. We have adopted enhanced cleaning practices and other health protocols in our offices, taken measures to significantly restrict non-essential business travel and have practices in place to mandate that employees who may have been exposed to COVID-19, or show any relevant symptoms, self-quarantine. In early March 2020, the Company executed on its Business Continuity Plan whereby the vast majority of our employees began to work remotely with only "essential" employees reporting to our offices. We accomplished this by significantly expanding the use of technology infrastructure that facilitates remote operations. Our ability to avoid significant business disruptions is reliant on the continued ability to have the vast majority of employees work remotely. To date, there have been no significant disruptions to our business or control processes as a result of this dispersion of employees. Recent outbreaks in various states indicate that COVID-19 will continue to impact the economy and, by extension, our business, well into 2021. We currently anticipate that a large number of our employees will continue to work remotely for the indefinite future until vaccinations are more widely administered.
Company Information
Oppenheimer Holdings Inc., through its operating subsidiaries, is a leading middle market investment bank and full service broker-dealer that is engaged in a broad range of activities in the financial services industry, including retail securities brokerage, institutional sales and trading, investment banking (corporate and public finance), equity and fixed income research, market-making, trust services, and investment advisory and asset management services. With roots tracing back to 1881, the Company is headquartered in New York and has 92 retail branch offices in the United States and institutional businesses located in London, Tel Aviv, and Hong Kong.
Forward-Looking Statements
This press release includes certain "forward-looking statements" relating to anticipated future performance including the projected impact of COVID-19 on the Company's business, financial performance, and operating results. The following factors, among others, could cause actual results to vary from the forward-looking statements: the severity and duration of COVID-19; COVID-19's impact on the U.S. and global economies; and Federal, state and local governmental responses to COVID-19. For a discussion of the factors that could cause future performance to be different than anticipated, reference is made to Factors Affecting "Forward-Looking Statements" and Part 1A – Risk Factors in the Company's Annual Report on Form 10-K for the year ended December 31, 2019 and Item 1 – Risk Factors in the Company's Quarterly Reports on Form 10-Q for the quarters ended March 31, 2020, June 30, 2020 and September 30, 2020.
Oppenheimer Holdings Inc | ||||||||||||||||||||
Consolidated Income Statements (Unaudited) | ||||||||||||||||||||
('000s, except number of shares and per share amounts) | ||||||||||||||||||||
For the Three Months Ended | For the Year Ended | |||||||||||||||||||
2020 | 2019 | % Change | 2020 | 2019 | % Change | |||||||||||||||
REVENUE | ||||||||||||||||||||
Commissions | $ | 97,971 | $ | 81,182 | 20.7 | $ | 395,097 | $ | 320,114 | 23.4 | ||||||||||
Advisory fees | 204,521 | 118,430 | 72.7 | 455,261 | 353,671 | 28.7 | ||||||||||||||
Investment banking | 84,139 | 44,364 | 89.7 | 222,298 | 126,211 | 76.1 | ||||||||||||||
Bank deposit sweep income | 4,262 | 22,730 | (81.2) | 34,829 | 117,422 | (70.3) | ||||||||||||||
Interest | 8,827 | 12,102 | (27.1) | 33,477 | 50,723 | (34.0) | ||||||||||||||
Principal transactions, net | 8,975 | 8,005 | 12.1 | 27,874 | 30,094 | (7.4) | ||||||||||||||
Other | 14,213 | 9,068 | 56.7 | 29,831 | 35,144 | (15.1) | ||||||||||||||
Total revenue | 422,908 | 295,881 | 42.9 | 1,198,667 | 1,033,379 | 16.0 | ||||||||||||||
EXPENSES | ||||||||||||||||||||
Compensation and related expenses | 244,073 | 190,292 | 28.3 | 770,997 | 657,714 | 17.2 | ||||||||||||||
Communications and technology | 21,443 | 20,131 | 6.5 | 82,132 | 81,588 | 0.7 | ||||||||||||||
Occupancy and equipment costs | 15,741 | 15,342 | 2.6 | 62,352 | 62,198 | 0.2 | ||||||||||||||
Clearing and exchange fees | 4,917 | 5,483 | (10.3) | 22,978 | 21,962 | 4.6 | ||||||||||||||
Interest | 2,779 | 7,978 | (65.2) | 15,680 | 45,687 | (65.7) | ||||||||||||||
Other | 20,160 | 21,682 | (7.0) | 75,528 | 89,318 | (15.4) | ||||||||||||||
Total expenses | 309,113 | 260,908 | 18.5 | 1,029,667 | 958,467 | 7.4 | ||||||||||||||
Pre-tax income | 113,795 | 34,973 | 225.4 | 169,000 | 74,912 | 125.6 | ||||||||||||||
Income taxes | 31,915 | 9,538 | 234.6 | 46,014 | 21,959 | 109.5 | ||||||||||||||
Net Income | $ | 81,880 | $ | 25,435 | 221.9 | $ | 122,986 | $ | 52,953 | 132.3 | ||||||||||
Earnings per share | ||||||||||||||||||||
Basic | $ | 6.56 | $ | 1.99 | 229.6 | $ | 9.73 | $ | 4.10 | 137.3 | ||||||||||
Diluted | $ | 6.17 | $ | 1.84 | 235.3 | $ | 9.30 | $ | 3.82 | 143.5 | ||||||||||
Weighted average number of common shares outstanding | ||||||||||||||||||||
Basic | 12,483,038 | 12,798,368 | (2.5) | 12,642,576 | 12,904,397 | (2.0) | ||||||||||||||
Diluted | 13,263,754 | 13,860,637 | (4.3) | 13,217,335 | 13,851,832 | (4.6) |
View original content:http://www.prnewswire.com/news-releases/oppenheimer-holdings-inc-reports-fourth-quarter-and-full-year-2020-earnings-301217787.html
SOURCE Oppenheimer Holdings Inc.
Copyright 2021 PR Newswire
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