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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% | 44.28 | 0 | 12:00:00 |
NEW YORK, Oct. 27, 2023 /PRNewswire/ -- Oppenheimer Holdings Inc. (NYSE: OPY) (the "Company" or "Firm") today reported net income of $13.9 million or $1.32 basic earnings per share for the third quarter of 2023, an increase of approximately 206.7%, compared with net income of $4.5 million or $0.40 basic earnings per share for the third quarter of 2022. Revenue for the third quarter of 2023 was $312.7 million, an increase of 6.3%, compared to revenue of $294.1 million for the third quarter of 2022.
Albert G. Lowenthal, Chairman and CEO commented, "The profitable results for the quarter reflect improved performance across many of our businesses, owing to higher interest rates and increased market volumes emanating from a still resilient economy. The rate of inflation continued to stabilize, while the labor market remained strong despite higher interest rates and labor unrest. The U.S. economy can perhaps yet achieve a "soft landing". The stronger economy, however, has led to a market expectation that the Federal Reserve will maintain "higher for longer" interest rates well into 2024 which, in conjunction with continued fighting in Ukraine and the new eruption of unparalleled violence in Israel and Gaza, has resulted in a pullback in most major equity indices.
Our Wealth Management business continued to benefit from recent macroeconomic conditions, with the elevated interest rate environment driving large increases in bank deposit sweep income and margin interest revenue compared to the prior year period. Higher valuations in client portfolios and the addition of new client assets also resulted in meaningful improvements in advisory fees, though these were offset to some extent by the stock market retreat during the quarter and lower transaction-based fees due to subdued client activity. Our Capital Markets business also generated strong results, with higher fixed income sales and trading and somewhat higher equities underwriting revenues offsetting lower M&A advisory fees.
We finished the quarter with a strong balance sheet and ample capital levels that will permit us to continue seeking investment opportunities across our businesses. During the quarter, the Company completed its previously disclosed "Dutch auction" tender offer in which we repurchased 437,183 shares of our Class A non-voting common stock at a price of $40.00 per share. During the quarter, the Company also purchased 168,904 shares (2%) of our Class A non-voting common stock at an average price of $38.30 per share in the open market under our share repurchase program. This resulted in 10,289,233 shares of Class A non-voting common stock remaining outstanding, resulting in book value and tangible book value per share at record levels as of September 30, 2023."
Summary Operating Results (Unaudited) | ||
('000s, except per share amounts or otherwise indicated) | ||
Firm | 3Q-23 | 3Q-22 |
Revenue | $ 312,667 | $ 294,111 |
Compensation Expense | $ 195,684 | $ 179,134 |
Non-compensation Expense | $ 95,396 | $ 107,739 |
Pre-Tax Income | $ 21,587 | $ 7,238 |
Income Taxes Provision | $ 7,808 | $ 2,573 |
Net Income (1) | $ 13,861 | $ 4,520 |
Earnings Per Share (Basic) (1) | $ 1.32 | $ 0.40 |
Earnings Per Share (Diluted) (1) | $ 1.21 | $ 0.37 |
Book Value Per Share | $ 75.01 | $ 70.23 |
Tangible Book Value Per Share (2) | $ 58.65 | $ 54.74 |
Private Client | ||
Revenue | $ 193,254 | $ 178,614 |
Pre-Tax Income | $ 65,249 | $ 29,973 |
Assets Under Administration (billions) | $ 110.7 | $ 100.3 |
Asset Management | ||
Revenue | $ 20,830 | $ 24,870 |
Pre-Tax Income | $ 4,951 | $ 8,322 |
Assets Under Management (billions) | $ 40.4 | $ 35.3 |
Capital Markets | ||
Revenue | $ 94,576 | $ 90,947 |
Pre-Tax Income (Loss) | $ (15,254) | $ 2,401 |
(1) Attributable to Oppenheimer Holdings Inc | ||
(2) Represents book value less goodwill and intangible assets divided by number of shares outstanding |
Highlights
Private Client
Private Client reported revenue for the current quarter of $193.3 million, 8.2% higher when compared with the prior year period. Pre-tax income was $65.2 million, compared with pre-tax income of $30.0 million in the prior year period. Financial advisor headcount at the end of the current quarter was 946 compared to 985 at the end of the third quarter of 2022.
('000s, except otherwise indicated) | ||
3Q-23 | 3Q-22 | |
Revenue | $ 193,254 | $ 178,614 |
Commissions | $ 44,385 | $ 46,893 |
Advisory Fees | $ 82,774 | $ 78,055 |
Bank Deposit Sweep Income | $ 42,304 | $ 35,769 |
Interest | $ 21,248 | $ 14,471 |
Other | $ 2,543 | $ 3,426 |
Total Expenses | $ 128,005 | $ 148,641 |
Compensation | $ 92,383 | $ 87,555 |
Non-compensation | $ 35,622 | $ 61,086 |
Pre-Tax Income | $ 65,249 | $ 29,973 |
Compensation Ratio | 47.8 % | 49.0 % |
Non-compensation Ratio | 18.4 % | 34.2 % |
Pre-Tax Margin | 33.8 % | 16.8 % |
Assets Under Administration (billions) | $ 110.7 | $ 100.3 |
Cash Sweep Balances (billions) | $ 3.5 | $ 6.5 |
Revenue:
Total Expenses:
Asset Management
Asset Management reported revenue for the current quarter of $20.8 million, 16.2% lower when compared with the prior year period. Pre-tax income was $5.0 million, a decrease of $3.4 million compared with the prior year period.
('000s, except otherwise indicated) | ||
3Q-23 | 3Q-22 | |
Revenue | $ 20,830 | $ 24,870 |
Advisory Fees | $ 25,188 | $ 24,787 |
Other | $ (4,358) | $ 83 |
Total Expenses | $ 15,879 | $ 16,548 |
Compensation | $ 5,585 | $ 6,702 |
Non-compensation | $ 10,294 | $ 9,846 |
Pre-Tax Income | $ 4,951 | $ 8,322 |
Compensation Ratio | 26.8 % | 26.9 % |
Non-compensation Ratio | 49.4 % | 39.6 % |
Pre-Tax Margin | 23.8 % | 33.5 % |
AUM (billions) | $ 40.4 | $ 35.3 |
Revenue:
Assets under Management (AUM):
Total Expenses:
Capital Markets
Capital Markets reported revenue for the current quarter of $94.6 million, 4.0% higher when compared with the prior year period. Pre-tax loss was $15.3 million, compared with pre-tax income of $2.4 million in the prior year period.
('000s) | ||
3Q-23 | 3Q-22 | |
Revenue | $ 94,576 | $ 90,947 |
Investment Banking | $ 36,000 | $ 36,951 |
Advisory Fees | $ 18,001 | $ 29,270 |
Equities Underwriting | $ 15,246 | $ 5,061 |
Fixed Income Underwriting | $ 2,049 | $ 2,111 |
Other | $ 704 | $ 509 |
Sales and Trading | $ 58,102 | $ 53,093 |
Equities | $ 30,985 | $ 34,877 |
Fixed Income | $ 27,117 | $ 18,216 |
Other | $ 474 | $ 903 |
Total Expenses | $ 109,830 | $ 88,546 |
Compensation | $ 72,933 | $ 60,415 |
Non-compensation | $ 36,897 | $ 28,131 |
Pre-Tax Income (Loss) | $ (15,254) | $ 2,401 |
Compensation Ratio | 77.1 % | 66.4 % |
Non-compensation Ratio | 39.0 % | 30.9 % |
Pre-Tax Margin | (16.1) % | 2.6 % |
Revenue:
Investment Banking
Sales and Trading
Total Expenses:
Other Matters
(In millions, except number of shares and per share amounts) | ||
3Q-23 | 3Q-22 | |
Capital | ||
Stockholders' Equity (1) | $ 779.3 | $ 770.7 |
Regulatory Net Capital (2) | $ 437.1 | $ 425.8 |
Regulatory Excess Net Capital (2) | $ 415.4 | $ 399.4 |
Common Stock Repurchases | ||
Share Repurchase Program | ||
Repurchases | $ 6.5 | $ 14.0 |
Number of Shares | 168,904 | 413,052 |
Average Price Per Share | $ 38.30 | $ 33.86 |
"Dutch Auction" Tender Offer | ||
Repurchases | $ 17.5 | $ — |
Number of Shares | 437,183 | — |
Average Price Per Share | $ 40.00 | $ — |
Period End Shares | 10,388,898 | 10,974,655 |
Effective Tax Rate | 36.2 % | 35.5 % |
(1) Attributable to Oppenheimer Holdings Inc | ||
(2) Attributable to Oppenheimer & Co. Inc. broker-dealer |
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. 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, 2022 and Factors Affecting "Forward-Looking Statements" in Part I, Item 2 in the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2023.
Oppenheimer Holdings Inc | ||||||||||||
Condensed Consolidated Income Statements (Unaudited) | ||||||||||||
('000s, except number of shares and per share amounts) | ||||||||||||
For the Three Months Ended September 30, | For the Nine Months Ended September 30, | |||||||||||
2023 | 2022 | % Change | 2023 | 2022 | % Change | |||||||
REVENUE | ||||||||||||
Commissions | $ 83,933 | $ 89,608 | (6.3) | $ 259,174 | $ 282,307 | (8.2) | ||||||
Advisory fees | 107,969 | 102,927 | 4.9 | 310,214 | 326,098 | (4.9) | ||||||
Investment banking | 37,411 | 38,393 | (2.6) | 95,354 | 93,516 | 2.0 | ||||||
Bank deposit sweep income | 42,304 | 35,769 | 18.3 | 135,273 | 54,968 | 146.1 | ||||||
Interest | 26,430 | 17,361 | 52.2 | 78,691 | 38,667 | 103.5 | ||||||
Principal transactions, net | 16,892 | 6,502 | 159.8 | 46,635 | 10,124 | 360.6 | ||||||
Other | (2,272) | 3,551 | * | 15,195 | (8,319) | * | ||||||
Total revenue | 312,667 | 294,111 | 6.3 | 940,536 | 797,361 | 18.0 | ||||||
EXPENSES | ||||||||||||
Compensation and related expenses | 195,684 | 179,134 | 9.2 | 589,200 | 543,144 | 8.5 | ||||||
Communications and technology | 22,590 | 21,500 | 5.1 | 67,813 | 63,981 | 6.0 | ||||||
Occupancy and equipment costs | 17,281 | 15,457 | 11.8 | 49,622 | 44,701 | 11.0 | ||||||
Clearing and exchange fees | 6,051 | 6,705 | (9.8) | 18,241 | 18,923 | (3.6) | ||||||
Interest | 19,744 | 7,018 | 181.3 | 50,353 | 13,158 | 282.7 | ||||||
Other | 29,730 | 57,059 | (47.9) | 136,369 | 98,172 | 38.9 | ||||||
Total expenses | 291,080 | 286,873 | 1.5 | 911,598 | 782,079 | 16.6 | ||||||
Pre-Tax Income | 21,587 | 7,238 | 198.2 | 28,938 | 15,282 | 89.4 | ||||||
Income taxes provision | 7,808 | 2,573 | 203.5 | 10,262 | 5,559 | 84.6 | ||||||
Net Income | $ 13,779 | $ 4,665 | 195.4 | $ 18,676 | $ 9,723 | 92.1 | ||||||
Less: Net income (loss) attributable to | (82) | 145 | * | (403) | (215) | 87.4 | ||||||
Net income attributable to | $ 13,861 | $ 4,520 | 206.7 | $ 19,079 | $ 9,938 | 92.0 | ||||||
Earnings per share attributable to Oppenheimer Holdings Inc | ||||||||||||
Basic | $ 1.32 | $ 0.40 | 230.0 | $ 1.75 | $ 0.84 | 108.3 | ||||||
Diluted | $ 1.21 | $ 0.37 | 227.0 | $ 1.62 | $ 0.78 | 107.7 | ||||||
Weighted average number of common shares outstanding | ||||||||||||
Basic | 10,519,431 | 11,270,589 | (6.7) | 10,874,055 | 11,901,727 | (8.6) | ||||||
Diluted | 11,440,229 | 12,190,425 | (6.2) | 11,746,337 | 12,809,000 | (8.3) | ||||||
Period end number of common | 10,388,898 | 10,974,655 | (5.3) | 10,388,898 | 10,974,655 | (5.3) | ||||||
* Percentage not meaningful |
Media Contact:
oppenheimer@haventower.com
View original content:https://www.prnewswire.com/news-releases/oppenheimer-holdings-inc-reports-third-quarter-2023-earnings-301969585.html
SOURCE Oppenheimer Holdings Inc.
Copyright 2023 PR Newswire
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