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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Piper Jaffray Companies | NYSE:PJC | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 79.62 | 0 | 01:00:00 |
July 24, 2014 | ||||
Date of report (Date of earliest event reported) |
PIPER JAFFRAY COMPANIES | ||||
(Exact Name of Registrant as Specified in its Charter) |
Delaware | 1-31720 | 30-0168701 | ||||||
(State of Incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||||||
800 Nicollet Mall, Suite 1000 | ||||||||
Minneapolis, Minnesota | 55402 | |||||||
(Address of Principal Executive Offices) | (Zip Code) | |||||||
(612) 303-6000 | ||||||||
(Registrant’s Telephone Number, Including Area Code) |
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
(d) | Exhibit |
PIPER JAFFRAY COMPANIES | ||||
Date: | July 24, 2014 | By | /s/ Debbra L. Schoneman | |
Debbra L. Schoneman | ||||
Chief Financial Officer |
No. | Description | Manner of Filing | ||
99 | Press Release dated July 24, 2014 | Filed Electronically |
• | Adjusted net income from continuing operations(1) was $20.5 million, or $1.25 per diluted common share(1), in the second quarter of 2014, compared to $5.6 million, or $0.32 per diluted common share, in the second quarter of 2013, and $20.0 million, or $1.24 per diluted common share, in the first quarter of 2014. |
• | Adjusted net revenues from continuing operations(1) were $166.7 million in the second quarter of 2014, compared to $102.0 million and $161.5 million in the second quarter of 2013 and the first quarter of 2014, respectively. |
• | Equity financing revenues of $44.1 million in the second quarter of 2014 and $79.4 million in the first half of 2014 were both records. Also, the firm generated record advisory services revenues of $79.4 million in the first half of 2014. |
• | Adjusted pre-tax operating margin(1) was 19.2% in the second quarter of 2014, compared to 7.8% and 19.3% in the second quarter of 2013 and the first quarter of 2014, respectively. |
• | Assets under management increased to $12.6 billion at June 30, 2014, compared to $10.2 billion in the year-ago period and $11.5 billion at the end of the first quarter of 2014. |
• | Rolling 12 month return on average common shareholders' equity increased to 9.2% at June 30, 2014, compared to 6.0% at June 30, 2013. Our rolling 12 month return on average tangible common shareholders' equity(2) improved to 13.9% at June 30, 2014. |
• | Book value per share increased 9.8% from June 30, 2013 to $52.54 a share at June 30, 2014. |
Three Months Ended | Percent Inc/(Dec) | Six Months Ended | ||||||||||||||||||||||||||
June 30, | Mar. 31, | June 30, | 2Q '14 | 2Q '14 | June 30, | June 30, | Percent | |||||||||||||||||||||
(Amounts in thousands, except per share data) | 2014 | 2014 | 2013 | vs. 1Q '14 | vs. 2Q '13 | 2014 | 2013 | Inc/(Dec) | ||||||||||||||||||||
As Adjusted(1) | ||||||||||||||||||||||||||||
Net revenues | $ | 166,698 | $ | 161,497 | $ | 102,012 | 3.2 | % | 63.4 | % | $ | 328,195 | $ | 208,735 | 57.2 | % | ||||||||||||
Net income from continuing operations | $ | 20,494 | $ | 20,035 | $ | 5,570 | 2.3 | % | 267.9 | % | $ | 40,529 | $ | 17,448 | 132.3 | % | ||||||||||||
Earnings per diluted common share from continuing operations | $ | 1.25 | $ | 1.24 | $ | 0.32 | 0.8 | % | 290.6 | % | $ | 2.49 | $ | 1.00 | 149.0 | % | ||||||||||||
U.S. GAAP | ||||||||||||||||||||||||||||
Net revenues | $ | 170,031 | $ | 168,133 | $ | 99,772 | 1.1 | % | 70.4 | % | $ | 338,164 | $ | 209,305 | 61.6 | % | ||||||||||||
Net income from continuing operations | $ | 18,213 | $ | 17,748 | $ | 4,359 | 2.6 | % | 317.8 | % | $ | 35,961 | $ | 15,026 | 139.3 | % | ||||||||||||
Earnings per diluted common share from continuing operations | $ | 1.11 | $ | 1.10 | $ | 0.25 | 0.9 | % | 344.0 | % | $ | 2.21 | $ | 0.86 | 157.0 | % | ||||||||||||
Earnings per diluted common share | $ | 1.11 | $ | 1.10 | $ | 0.15 | 0.9 | % | 640.0 | % | $ | 2.21 | $ | 0.73 | 202.7 | % | ||||||||||||
Pre-tax operating margin from continuing operations | 17.9 | % | 19.5 | % | 3.3 | % | 18.7 | % | 10.3 | % |
(1) | A non-U.S. GAAP ("non-GAAP") measure. For a detailed explanation of the adjustments made to the corresponding U.S. GAAP measures, see "Reconciliation of U.S. GAAP to Selected Summary Financial Information." We believe that presenting our results and measures on an adjusted basis in conjunction with U.S. GAAP measures provides the most meaningful basis for comparison of our operating results across periods. |
(2) | A non-GAAP measure. See the "Additional Shareholder Information" section for a detailed explanation of the adjustment made to the corresponding U.S. GAAP measure. We believe that the rolling 12 month return on average tangible common shareholders' equity is a meaningful measure of our return on tangible assets deployed in the business. |
• | Equity financing revenues of $44.1 million increased 102% and 25% compared to the second quarter of 2013 and the first quarter of 2014, respectively. Revenues were favorable compared to both periods due to more completed transactions and higher revenue per transaction. |
• | Debt financing revenues were $20.2 million, down 9% compared to the year-ago period due to fewer completed transactions, and up 49% compared to the first quarter of 2014 due to more completed transactions. |
• | Advisory services revenues were $39.7 million, up 323% compared to the second quarter of 2013 and essentially flat compared to the first quarter of 2014. Revenues increased compared to the year-ago period due to more completed transactions and higher revenue per transaction. |
• | Equity institutional brokerage revenues of $18.4 million decreased 14% compared to the second quarter of 2013 due to lower client trading volumes. Revenues decreased 24% compared to the first quarter of 2014 due to lower client trading volumes, and the absence of block trades during the quarter. |
• | Fixed income institutional brokerage revenues were $21.1 million, up 155% compared to the second quarter of 2013 due to trading losses on inventory positions in the year-ago period. In the second quarter of 2013, the fixed income market experienced a rapid increase in interest rates, a widening of credit spreads, and a volatile trading environment. These market dynamics in the year-ago period negatively impacted our inventory values which were not fully mitigated by our hedging strategies. Revenues were down 17% compared to the first quarter of 2014 due to lower trading gains and lower client trading volume. |
• | Management and performance fees earned from managing our alternative asset management funds were $1.4 million, compared to $0.6 million and $1.7 million in the year-ago period and the sequential quarter, respectively. The increase compared to the second quarter of 2013 was due to higher performance fees. |
• | Adjusted investment income, which includes gains and losses on our investments in the merchant banking fund and the municipal bond fund that we manage for third-party investors, and other firm investments, was $1.7 million, compared to $2.4 million in the year-ago period and $3.7 million in the first quarter of 2014. The decrease compared to the second quarter of 2013 was due to lower gains on our merchant banking investments, partially offset by higher gains on our investment in the municipal bond fund that we manage for third-party investors. Adjusted investment income decreased compared to the sequential quarter due primarily to lower gains on our merchant banking investments. |
• | Long-term financing expenses, which primarily represents interest paid on the firm's variable rate senior notes, were $1.7 million, down 9% compared to the second quarter of 2013 and essentially flat with the first quarter of 2014. |
• | Adjusted operating expenses for the second quarter of 2014 were $121.7 million, up 46% compared to the second quarter of 2013. The increase primarily resulted from higher compensation expenses due to improved operating results and business expansion. Compared to the first quarter of 2014, adjusted operating expenses increased 3%. |
• | Adjusted segment pre-tax operating margin was 15.9% compared to 0.7% in the year-ago period and 17.0% in the first quarter of 2014. Adjusted pre-tax operating margin improved compared to the second quarter of 2013 due to higher net revenues and decreased compared to the sequential quarter due to higher non-compensation costs. |
• | Adjusted operating expenses for the current quarter were $13.0 million, up 24% compared to the year-ago period due to higher compensation and non-compensation expenses. Compared to the first quarter of 2014, adjusted operating expenses increased by 3%. |
• | Adjusted segment pre-tax operating margin was 40.7%, compared to 41.4% in the year-ago period and 36.0% in the first quarter of 2014. Adjusted segment pre-tax operating margin declined relative to the second quarter of 2013 due to higher non-compensation expenses, and improved from the sequential quarter due to a lower compensation ratio driven by higher net revenues. |
• | AUM was $12.6 billion at the end of the second quarter of 2014, compared to $10.2 billion in the year-ago period and $11.5 billion at the end of the first quarter of 2014. Increases in AUM have been driven primarily by market appreciation. |
For the Quarter Ended | |||||
June 30, 2014 | Mar. 31, 2014 | June 30, 2013 | |||
Full time employees | 999 | 1,015 | 918 | ||
Equity financings | |||||
# of transactions | 33 | 30 | 22 | ||
Capital raised | $9.2 billion | $5.3 billion | $5.0 billion | ||
Negotiated tax-exempt issuances | |||||
# of transactions | 112 | 57 | 143 | ||
Par value | $2.4 billion | $1.6 billion | $2.9 billion | ||
Mergers & acquisitions | |||||
# of transactions | 15 | 16 | 4 | ||
Aggregate deal value | $3.5 billion | $2.5 billion | $0.2 billion | ||
Asset Management | |||||
AUM | $12.6 billion | $11.5 billion | $10.2 billion | ||
Common shareholders’ equity | $787.8 million | $767.5 million | $729.9 million | ||
Number of common shares outstanding (in thousands) | 14,995 | 14,916 | 15,261 | ||
Rolling 12 month return on average common shareholders’ equity ** | 9.2% | 7.2% | 6.0% | ||
Rolling 12 month return on average tangible common shareholders’ equity † | 13.9% | 10.9% | 9.0% | ||
Book value per share | $52.54 | $51.45 | $47.83 | ||
Tangible book value per share ‡ | $36.06 | $34.81 | $32.44 |
* | Number of employees, transaction data, and AUM reflect continuing operations; other numbers reflect continuing and discontinued results. |
** | Rolling 12 month return on average common shareholders' equity is computed by dividing net income applicable to Piper Jaffray Companies' for the last 12 months by average monthly common shareholders' equity. |
As of | As of | As of | |||||||||
(Amounts in thousands) | June 30, 2014 | Mar. 31, 2014 | June 30, 2013 | ||||||||
Average common shareholders’ equity | $ | 740,280 | $ | 732,386 | $ | 730,477 | |||||
Deduct: average goodwill and identifiable intangible assets | 249,096 | 246,867 | 242,794 | ||||||||
Average tangible common shareholders’ equity | $ | 491,184 | $ | 485,519 | $ | 487,683 |
As of | As of | As of | |||||||||
(Amounts in thousands) | June 30, 2014 | Mar. 31, 2014 | June 30, 2013 | ||||||||
Common shareholders’ equity | $ | 787,848 | $ | 767,454 | $ | 729,880 | |||||
Deduct: goodwill and identifiable intangible assets | 247,172 | 248,246 | 234,780 | ||||||||
Tangible common shareholders’ equity | $ | 540,676 | $ | 519,208 | $ | 495,100 |
• | market and economic conditions or developments may be unfavorable, including in specific sectors in which we operate, and these conditions or developments, such as market fluctuations or volatility, may adversely affect our business, revenue levels and profitability; |
• | interest rate volatility, especially if the changes are rapid or severe, could negatively impact our fixed income institutional business; |
• | strategic trading activities comprise a meaningful portion of our fixed income institutional brokerage revenue, and results from these activities may be volatile and vary significantly, including the possibility of incurring losses, on a quarterly and annual basis; |
• | the volume of anticipated investment banking transactions as reflected in our deal pipelines (and the net revenues we earn from such transactions) may differ from expected results if there is a decline in macroeconomic conditions or the financial markets, or if the terms of any transactions are modified; |
• | our stock price may fluctuate as a result of several factors, including but not limited to, changes in our revenues and operating results. |
Three Months Ended | Percent Inc/(Dec) | Six Months Ended | ||||||||||||||||||||||||||
June 30, | Mar. 31, | June 30, | 2Q '14 | 2Q '14 | June 30, | June 30, | Percent | |||||||||||||||||||||
(Amounts in thousands, except per share data) | 2014 | 2014 | 2013 | vs. 1Q '14 | vs. 2Q '13 | 2014 | 2013 | Inc/(Dec) | ||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||
Investment banking | $ | 103,813 | $ | 88,474 | $ | 53,255 | 17.3 | % | 94.9 | % | $ | 192,287 | $ | 94,076 | 104.4 | % | ||||||||||||
Institutional brokerage | 34,528 | 44,034 | 24,611 | (21.6 | ) | 40.3 | 78,562 | 64,758 | 21.3 | |||||||||||||||||||
Asset management | 22,266 | 20,959 | 18,427 | 6.2 | 20.8 | 43,225 | 36,883 | 17.2 | ||||||||||||||||||||
Interest | 12,448 | 13,659 | 12,286 | (8.9 | ) | 1.3 | 26,107 | 23,109 | 13.0 | |||||||||||||||||||
Investment income/(loss) | 2,921 | 6,768 | (2,059 | ) | (56.8 | ) | N/M | 9,689 | 3,006 | 222.3 | ||||||||||||||||||
Total revenues | 175,976 | 173,894 | 106,520 | 1.2 | 65.2 | 349,870 | 221,832 | 57.7 | ||||||||||||||||||||
Interest expense | 5,945 | 5,761 | 6,748 | 3.2 | (11.9 | ) | 11,706 | 12,527 | (6.6 | ) | ||||||||||||||||||
Net revenues | 170,031 | 168,133 | 99,772 | 1.1 | 70.4 | 338,164 | 209,305 | 61.6 | ||||||||||||||||||||
Non-interest expenses: | ||||||||||||||||||||||||||||
Compensation and benefits | 103,076 | 100,489 | 65,000 | 2.6 | 58.6 | 203,565 | 131,105 | 55.3 | ||||||||||||||||||||
Occupancy and equipment | 7,061 | 6,778 | 6,543 | 4.2 | 7.9 | 13,839 | 12,360 | 12.0 | ||||||||||||||||||||
Communications | 5,432 | 5,955 | 5,030 | (8.8 | ) | 8.0 | 11,387 | 10,262 | 11.0 | |||||||||||||||||||
Floor brokerage and clearance | 1,788 | 1,834 | 2,247 | (2.5 | ) | (20.4 | ) | 3,622 | 4,397 | (17.6 | ) | |||||||||||||||||
Marketing and business development | 6,709 | 6,251 | 5,957 | 7.3 | 12.6 | 12,960 | 10,937 | 18.5 | ||||||||||||||||||||
Outside services | 9,914 | 8,768 | 8,449 | 13.1 | 17.3 | 18,682 | 15,663 | 19.3 | ||||||||||||||||||||
Intangible asset amortization expense | 2,318 | 2,318 | 1,661 | — | 39.6 | 4,636 | 3,322 | 39.6 | ||||||||||||||||||||
Other operating expenses | 3,316 | 3,027 | 1,552 | 9.5 | 113.7 | 6,343 | (242 | ) | N/M | |||||||||||||||||||
Total non-interest expenses | 139,614 | 135,420 | 96,439 | 3.1 | 44.8 | 275,034 | 187,804 | 46.4 | ||||||||||||||||||||
Income from continuing operations before income tax expense | 30,417 | 32,713 | 3,333 | (7.0 | ) | 812.6 | 63,130 | 21,501 | 193.6 | |||||||||||||||||||
Income tax expense | 10,049 | 9,827 | 1,644 | 2.3 | 511.3 | 19,876 | 7,244 | 174.4 | ||||||||||||||||||||
Income from continuing operations | 20,368 | 22,886 | 1,689 | (11.0 | ) | N/M | 43,254 | 14,257 | 203.4 | |||||||||||||||||||
Discontinued operations: | ||||||||||||||||||||||||||||
Loss from discontinued operations, net of tax | — | — | (1,871 | ) | N/M | N/M | — | (2,392 | ) | N/M | ||||||||||||||||||
Net income/(loss) | 20,368 | 22,886 | (182 | ) | (11.0 | ) | N/M | 43,254 | 11,865 | 264.6 | ||||||||||||||||||
Net income/(loss) applicable to noncontrolling interests | 2,155 | 5,138 | (2,670 | ) | (58.1 | ) | N/M | 7,293 | (769 | ) | N/M | |||||||||||||||||
Net income applicable to Piper Jaffray Companies (a) | $ | 18,213 | $ | 17,748 | $ | 2,488 | 2.6 | % | 632.0 | % | $ | 35,961 | $ | 12,634 | 184.6 | % | ||||||||||||
Net income applicable to Piper Jaffray Companies’ common shareholders (a) | $ | 16,717 | $ | 16,089 | $ | 2,266 | 3.9 | % | 637.7 | % | $ | 32,806 | $ | 11,333 | 189.5 | % | ||||||||||||
Three Months Ended | Percent Inc/(Dec) | Six Months Ended | ||||||||||||||||||||||||||
June 30, | Mar. 31, | June 30, | 2Q '14 | 2Q '14 | June 30, | June 30, | Percent | |||||||||||||||||||||
(Amounts in thousands, except per share data) | 2014 | 2014 | 2013 | vs. 1Q '14 | vs. 2Q '13 | 2014 | 2013 | Inc/(Dec) | ||||||||||||||||||||
Amounts applicable to Piper Jaffray Companies | ||||||||||||||||||||||||||||
Net income from continuing operations | $ | 18,213 | $ | 17,748 | $ | 4,359 | 2.6 | % | 317.8 | % | $ | 35,961 | $ | 15,026 | 139.3 | % | ||||||||||||
Net loss from discontinued operations | — | — | (1,871 | ) | N/M | N/M | — | (2,392 | ) | N/M | ||||||||||||||||||
Net income applicable to Piper Jaffray Companies | $ | 18,213 | $ | 17,748 | $ | 2,488 | 2.6 | % | 632.0 | % | $ | 35,961 | $ | 12,634 | 184.6 | % | ||||||||||||
Earnings/(loss) per basic common share | ||||||||||||||||||||||||||||
Income from continuing operations | $ | 1.12 | $ | 1.10 | $ | 0.25 | 1.8 | % | 348.0 | % | $ | 2.22 | $ | 0.86 | 158.1 | % | ||||||||||||
Loss from discontinued operations | — | — | (0.11 | ) | N/M | N/M | — | (0.14 | ) | N/M | ||||||||||||||||||
Earnings per basic common share | $ | 1.12 | $ | 1.10 | $ | 0.15 | 1.8 | % | 646.7 | % | $ | 2.22 | $ | 0.73 | 204.1 | % | ||||||||||||
Earnings/(loss) per diluted common share | ||||||||||||||||||||||||||||
Income from continuing operations | $ | 1.11 | $ | 1.10 | $ | 0.25 | 0.9 | % | 344.0 | % | $ | 2.21 | $ | 0.86 | 157.0 | % | ||||||||||||
Loss from discontinued operations | — | — | (0.11 | ) | N/M | N/M | — | (0.14 | ) | N/M | ||||||||||||||||||
Earnings per diluted common share | $ | 1.11 | $ | 1.10 | $ | 0.15 | 0.9 | % | 640.0 | % | $ | 2.21 | $ | 0.73 | 202.7 | % | ||||||||||||
Weighted average number of common shares outstanding | ||||||||||||||||||||||||||||
Basic | 14,958 | 14,612 | 15,621 | 2.4 | % | (4.2 | )% | 14,786 | 15,602 | (5.2 | )% | |||||||||||||||||
Diluted | 15,013 | 14,657 | 15,626 | 2.4 | % | (3.9 | )% | 14,836 | 15,619 | (5.0 | )% |
(a) | Net income applicable to Piper Jaffray Companies is the total net income earned by the Company. Piper Jaffray Companies calculates earnings per common share using the two-class method, which requires the allocation of consolidated net income between common shareholders and participating security holders, which in the case of Piper Jaffray Companies, represents unvested restricted stock with dividend rights. |
Three Months Ended | Percent Inc/(Dec) | Six Months Ended | ||||||||||||||||||||||||||
June 30, | Mar. 31, | June 30, | 2Q '14 | 2Q '14 | June 30, | June 30, | Percent | |||||||||||||||||||||
(Dollars in thousands) | 2014 | 2014 | 2013 | vs. 1Q '14 | vs. 2Q '13 | 2014 | 2013 | Inc/(Dec) | ||||||||||||||||||||
Capital Markets | ||||||||||||||||||||||||||||
Investment banking | ||||||||||||||||||||||||||||
Financing | ||||||||||||||||||||||||||||
Equities | $ | 44,058 | $ | 35,301 | $ | 21,772 | 24.8 | % | 102.4 | % | $ | 79,359 | $ | 36,075 | 120.0 | % | ||||||||||||
Debt | 20,174 | 13,539 | 22,131 | 49.0 | (8.8 | ) | 33,713 | 39,163 | (13.9 | ) | ||||||||||||||||||
Advisory services | 39,695 | 39,728 | 9,394 | (0.1 | ) | 322.6 | 79,423 | 18,950 | 319.1 | |||||||||||||||||||
Total investment banking | 103,927 | 88,568 | 53,297 | 17.3 | 95.0 | 192,495 | 94,188 | 104.4 | ||||||||||||||||||||
Institutional sales and trading | ||||||||||||||||||||||||||||
Equities | 18,366 | 24,260 | 21,384 | (24.3 | ) | (14.1 | ) | 42,626 | 42,119 | 1.2 | ||||||||||||||||||
Fixed income | 21,085 | 25,238 | 8,261 | (16.5 | ) | 155.2 | 46,323 | 32,649 | 41.9 | |||||||||||||||||||
Total institutional sales and trading | 39,451 | 49,498 | 29,645 | (20.3 | ) | 33.1 | 88,949 | 74,768 | 19.0 | |||||||||||||||||||
Management and performance fees | 1,388 | 1,737 | 564 | (20.1 | ) | 146.1 | 3,125 | 1,583 | 97.4 | |||||||||||||||||||
Investment income | 4,998 | 10,378 | 184 | (51.8 | ) | N/M | 15,376 | 6,321 | 143.3 | |||||||||||||||||||
Long-term financing expenses | (1,705 | ) | (1,740 | ) | (1,872 | ) | (2.0 | ) | (8.9 | ) | (3,445 | ) | (3,821 | ) | (9.8 | ) | ||||||||||||
Net revenues | 148,059 | 148,441 | 81,818 | (0.3 | ) | 81.0 | 296,500 | 173,039 | 71.3 | |||||||||||||||||||
Operating expenses | 124,691 | 120,930 | 83,937 | 3.1 | 48.6 | 245,621 | 162,395 | 51.2 | ||||||||||||||||||||
Segment pre-tax operating income/(loss) | $ | 23,368 | $ | 27,511 | $ | (2,119 | ) | (15.1 | )% | N/M | $ | 50,879 | $ | 10,644 | 378.0 | % | ||||||||||||
Segment pre-tax operating margin | 15.8 | % | 18.5 | % | (2.6 | )% | 17.2 | % | 6.2 | % | ||||||||||||||||||
Asset Management | ||||||||||||||||||||||||||||
Management and performance fees | ||||||||||||||||||||||||||||
Management fees | $ | 20,600 | $ | 19,136 | $ | 17,558 | 7.7 | % | 17.3 | % | $ | 39,736 | $ | 34,644 | 14.7 | % | ||||||||||||
Performance fees | 278 | 86 | 305 | 223.3 | (8.9 | ) | 364 | 656 | (44.5 | ) | ||||||||||||||||||
Total management and performance fees | 20,878 | 19,222 | 17,863 | 8.6 | 16.9 | 40,100 | 35,300 | 13.6 | ||||||||||||||||||||
Investment income | 1,094 | 470 | 91 | 132.8 | N/M | 1,564 | 966 | 61.9 | ||||||||||||||||||||
Net revenues | 21,972 | 19,692 | 17,954 | 11.6 | 22.4 | 41,664 | 36,266 | 14.9 | ||||||||||||||||||||
Operating expenses | 14,923 | 14,490 | 12,502 | 3.0 | 19.4 | 29,413 | 25,409 | 15.8 | ||||||||||||||||||||
Segment pre-tax operating income | $ | 7,049 | $ | 5,202 | $ | 5,452 | 35.5 | % | 29.3 | % | $ | 12,251 | $ | 10,857 | 12.8 | % | ||||||||||||
Segment pre-tax operating margin | 32.1 | % | 26.4 | % | 30.4 | % | 29.4 | % | 29.9 | % | ||||||||||||||||||
Total | ||||||||||||||||||||||||||||
Net revenues | $ | 170,031 | $ | 168,133 | $ | 99,772 | 1.1 | % | 70.4 | % | $ | 338,164 | $ | 209,305 | 61.6 | % | ||||||||||||
Operating expenses | 139,614 | 135,420 | 96,439 | 3.1 | 44.8 | 275,034 | 187,804 | 46.4 | ||||||||||||||||||||
Pre-tax operating income | $ | 30,417 | $ | 32,713 | $ | 3,333 | (7.0 | )% | 812.6 | % | $ | 63,130 | $ | 21,501 | 193.6 | % | ||||||||||||
Pre-tax operating margin | 17.9 | % | 19.5 | % | 3.3 | % | 18.7 | % | 10.3 | % |
Three Months Ended | Percent Inc/(Dec) | Six Months Ended | ||||||||||||||||||||||||||
June 30, | Mar. 31, | June 30, | 2Q '14 | 2Q '14 | June 30, | June 30, | Percent | |||||||||||||||||||||
(Amounts in thousands, except per share data) | 2014 | 2014 | 2013 | vs. 1Q '14 | vs. 2Q '13 | 2014 | 2013 | Inc/(Dec) | ||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||
Investment banking | $ | 103,813 | $ | 88,474 | $ | 53,255 | 17.3 | % | 94.9 | % | $ | 192,287 | $ | 94,076 | 104.4 | % | ||||||||||||
Institutional brokerage | 34,528 | 44,034 | 24,611 | (21.6 | ) | 40.3 | 78,562 | 64,758 | 21.3 | |||||||||||||||||||
Asset management | 22,266 | 20,959 | 18,427 | 6.2 | 20.8 | 43,225 | 36,883 | 17.2 | ||||||||||||||||||||
Interest | 9,451 | 10,356 | 10,019 | (8.7 | ) | (5.7 | ) | 19,807 | 19,287 | 2.7 | ||||||||||||||||||
Investment income | 1,666 | 2,581 | 1,500 | (35.5 | ) | 11.1 | 4,247 | 4,712 | (9.9 | ) | ||||||||||||||||||
Total revenues | 171,724 | 166,404 | 107,812 | 3.2 | 59.3 | 338,128 | 219,716 | 53.9 | ||||||||||||||||||||
Interest expense | 5,026 | 4,907 | 5,800 | 2.4 | (13.3 | ) | 9,933 | 10,981 | (9.5 | ) | ||||||||||||||||||
Adjusted net revenues (2) | $ | 166,698 | $ | 161,497 | $ | 102,012 | 3.2 | % | 63.4 | % | $ | 328,195 | $ | 208,735 | 57.2 | % | ||||||||||||
Non-interest expenses: | ||||||||||||||||||||||||||||
Adjusted compensation and benefits (3) | $ | 101,660 | $ | 99,200 | $ | 64,679 | 2.5 | % | 57.2 | % | $ | 200,860 | $ | 130,463 | 54.0 | % | ||||||||||||
Ratio of adjusted compensation and benefits to adjusted net revenues | 61.0 | % | 61.4 | % | 63.4 | % | 61.2 | % | 62.5 | % | ||||||||||||||||||
Adjusted non-compensation expenses (4) | $ | 33,042 | $ | 31,115 | $ | 29,348 | 6.2 | % | 12.6 | % | $ | 64,157 | $ | 52,038 | 23.3 | % | ||||||||||||
Ratio of adjusted non-compensation expenses to adjusted net revenues | 19.8 | % | 19.3 | % | 28.8 | % | 19.5 | % | 24.9 | % | ||||||||||||||||||
Adjusted income: | ||||||||||||||||||||||||||||
Adjusted income from continuing operations before adjusted income tax expense (5) | $ | 31,996 | $ | 31,182 | $ | 7,985 | 2.6 | % | 300.7 | % | $ | 63,178 | $ | 26,234 | 140.8 | % | ||||||||||||
Adjusted operating margin (6) | 19.2 | % | 19.3 | % | 7.8 | % | 19.3 | % | 12.6 | % | ||||||||||||||||||
Adjusted income tax expense (7) | 11,502 | 11,147 | 2,415 | 3.2 | 376.3 | 22,649 | 8,786 | 157.8 | ||||||||||||||||||||
Adjusted net income from continuing operations (8) | $ | 20,494 | $ | 20,035 | $ | 5,570 | 2.3 | % | 267.9 | % | $ | 40,529 | $ | 17,448 | 132.3 | % | ||||||||||||
Effective tax rate (9) | 35.9 | % | 35.7 | % | 30.2 | % | 35.8 | % | 33.5 | % | ||||||||||||||||||
Adjusted net income from continuing operations applicable to Piper Jaffray Companies’ common shareholders (10) | $ | 18,811 | $ | 18,162 | $ | 5,073 | 3.6 | % | 270.8 | % | $ | 36,973 | $ | 15,652 | 136.2 | % | ||||||||||||
Adjusted earnings per diluted common share from continuing operations | $ | 1.25 | $ | 1.24 | $ | 0.32 | 0.8 | % | 290.6 | % | $ | 2.49 | $ | 1.00 | 149.0 | % | ||||||||||||
Weighted average number of common shares outstanding | ||||||||||||||||||||||||||||
Diluted | 15,013 | 14,657 | 15,626 | 2.4 | % | (3.9 | )% | 14,836 | 15,619 | (5.0 | )% |
Three Months Ended | Percent Inc/(Dec) | Six Months Ended | ||||||||||||||||||||||||||
June 30, | Mar. 31, | June 30, | 2Q '14 | 2Q '14 | June 30, | June 30, | Percent | |||||||||||||||||||||
(Dollars in thousands) | 2014 | 2014 | 2013 | vs. 1Q '14 | vs. 2Q '13 | 2014 | 2013 | Inc/(Dec) | ||||||||||||||||||||
Capital Markets | ||||||||||||||||||||||||||||
Investment banking | ||||||||||||||||||||||||||||
Financing | ||||||||||||||||||||||||||||
Equities | $ | 44,058 | $ | 35,301 | $ | 21,772 | 24.8 | % | 102.4 | % | $ | 79,359 | $ | 36,075 | 120.0 | % | ||||||||||||
Debt | 20,174 | 13,539 | 22,131 | 49.0 | (8.8 | ) | 33,713 | 39,163 | (13.9 | ) | ||||||||||||||||||
Advisory services | 39,695 | 39,728 | 9,394 | (0.1 | ) | 322.6 | 79,423 | 18,950 | 319.1 | |||||||||||||||||||
Total investment banking | 103,927 | 88,568 | 53,297 | 17.3 | 95.0 | 192,495 | 94,188 | 104.4 | ||||||||||||||||||||
Institutional sales and trading | ||||||||||||||||||||||||||||
Equities | 18,366 | 24,260 | 21,384 | (24.3 | ) | (14.1 | ) | 42,626 | 42,119 | 1.2 | ||||||||||||||||||
Fixed income | 21,085 | 25,238 | 8,261 | (16.5 | ) | 155.2 | 46,323 | 32,649 | 41.9 | |||||||||||||||||||
Total institutional sales and trading | 39,451 | 49,498 | 29,645 | (20.3 | ) | 33.1 | 88,949 | 74,768 | 19.0 | |||||||||||||||||||
Management and performance fees | 1,388 | 1,737 | 564 | (20.1 | ) | 146.1 | 3,125 | 1,583 | 97.4 | |||||||||||||||||||
Investment income | 1,665 | 3,742 | 2,424 | (55.5 | ) | (31.3 | ) | 5,407 | 5,751 | (6.0 | ) | |||||||||||||||||
Long-term financing expenses | (1,705 | ) | (1,740 | ) | (1,872 | ) | (2.0 | ) | (8.9 | ) | (3,445 | ) | (3,821 | ) | (9.8 | ) | ||||||||||||
Adjusted net revenues (2) | 144,726 | 141,805 | 84,058 | 2.1 | 72.2 | 286,531 | 172,469 | 66.1 | ||||||||||||||||||||
Adjusted operating expenses (12) | 121,675 | 117,721 | 83,507 | 3.4 | 45.7 | 239,396 | 161,056 | 48.6 | ||||||||||||||||||||
Adjusted segment pre-tax operating income (5) | $ | 23,051 | $ | 24,084 | $ | 551 | (4.3 | )% | N/M | $ | 47,135 | $ | 11,413 | 313.0 | % | |||||||||||||
Adjusted segment pre-tax operating margin (6) | 15.9 | % | 17.0 | % | 0.7 | % | 16.5 | % | 6.6 | % | ||||||||||||||||||
Asset Management | ||||||||||||||||||||||||||||
Management and performance fees | ||||||||||||||||||||||||||||
Management fees | $ | 20,600 | $ | 19,136 | $ | 17,558 | 7.7 | % | 17.3 | % | $ | 39,736 | $ | 34,644 | 14.7 | % | ||||||||||||
Performance fees | 278 | 86 | 305 | 223.3 | (8.9 | ) | 364 | 656 | (44.5 | ) | ||||||||||||||||||
Total management and performance fees | 20,878 | 19,222 | 17,863 | 8.6 | 16.9 | 40,100 | 35,300 | 13.6 | ||||||||||||||||||||
Investment income | 1,094 | 470 | 91 | 132.8 | N/M | 1,564 | 966 | 61.9 | ||||||||||||||||||||
Net revenues | 21,972 | 19,692 | 17,954 | 11.6 | 22.4 | 41,664 | 36,266 | 14.9 | ||||||||||||||||||||
Adjusted operating expenses (13) | 13,027 | 12,594 | 10,520 | 3.4 | 23.8 | 25,621 | 21,445 | 19.5 | ||||||||||||||||||||
Adjusted segment pre-tax operating income (13) | $ | 8,945 | $ | 7,098 | $ | 7,434 | 26.0 | % | 20.3 | % | $ | 16,043 | $ | 14,821 | 8.2 | % | ||||||||||||
Adjusted segment pre-tax operating margin (6) | 40.7 | % | 36.0 | % | 41.4 | % | 38.5 | % | 40.9 | % | ||||||||||||||||||
Total | ||||||||||||||||||||||||||||
Adjusted net revenues (2) | $ | 166,698 | $ | 161,497 | $ | 102,012 | 3.2 | % | 63.4 | % | $ | 328,195 | $ | 208,735 | 57.2 | % | ||||||||||||
Adjusted operating expenses (12) | 134,702 | 130,315 | 94,027 | 3.4 | 43.3 | 265,017 | 182,501 | 45.2 | ||||||||||||||||||||
Adjusted pre-tax operating income (5) | $ | 31,996 | $ | 31,182 | $ | 7,985 | 2.6 | % | 300.7 | % | $ | 63,178 | $ | 26,234 | 140.8 | % | ||||||||||||
Adjusted pre-tax operating margin (6) | 19.2 | % | 19.3 | % | 7.8 | % | 19.3 | % | 12.6 | % |
Three Months Ended | Six Months Ended | ||||||||||||||||||
June 30, | Mar. 31, | June 30, | June 30, | June 30, | |||||||||||||||
(Amounts in thousands, except per share data) | 2014 | 2014 | 2013 | 2014 | 2013 | ||||||||||||||
Net revenues: | |||||||||||||||||||
Net revenues – U.S. GAAP basis | $ | 170,031 | $ | 168,133 | $ | 99,772 | $ | 338,164 | $ | 209,305 | |||||||||
Adjustments: | |||||||||||||||||||
Revenue related to noncontrolling interests (11) | (3,333 | ) | (6,636 | ) | 2,240 | (9,969 | ) | (570 | ) | ||||||||||
Adjusted net revenues | $ | 166,698 | $ | 161,497 | $ | 102,012 | $ | 328,195 | $ | 208,735 | |||||||||
Compensation and benefits: | |||||||||||||||||||
Compensation and benefits – U.S. GAAP basis | $ | 103,076 | $ | 100,489 | $ | 65,000 | $ | 203,565 | $ | 131,105 | |||||||||
Adjustments: | |||||||||||||||||||
Compensation from acquisition-related agreements | (1,416 | ) | (1,289 | ) | (321 | ) | (2,705 | ) | (642 | ) | |||||||||
Adjusted compensation and benefits | $ | 101,660 | $ | 99,200 | $ | 64,679 | $ | 200,860 | $ | 130,463 | |||||||||
Non-compensation expenses: | |||||||||||||||||||
Non-compensation expenses – U.S. GAAP basis | $ | 36,538 | $ | 34,931 | $ | 31,439 | $ | 71,469 | $ | 56,699 | |||||||||
Adjustments: | |||||||||||||||||||
Non-compensation expenses related to noncontrolling interests (11) | (1,178 | ) | (1,498 | ) | (430 | ) | (2,676 | ) | (1,339 | ) | |||||||||
Amortization of intangible assets related to acquisitions | (2,318 | ) | (2,318 | ) | (1,661 | ) | (4,636 | ) | (3,322 | ) | |||||||||
Adjusted non-compensation expenses | $ | 33,042 | $ | 31,115 | $ | 29,348 | $ | 64,157 | $ | 52,038 | |||||||||
Income from continuing operations before income tax expense: | |||||||||||||||||||
Income from continuing operations before income tax expense – U.S. GAAP basis | $ | 30,417 | $ | 32,713 | $ | 3,333 | $ | 63,130 | $ | 21,501 | |||||||||
Adjustments: | |||||||||||||||||||
Revenue related to noncontrolling interests (11) | (3,333 | ) | (6,636 | ) | 2,240 | (9,969 | ) | (570 | ) | ||||||||||
Expenses related to noncontrolling interests (11) | 1,178 | 1,498 | 430 | 2,676 | 1,339 | ||||||||||||||
Compensation from acquisition-related agreements | 1,416 | 1,289 | 321 | 2,705 | 642 | ||||||||||||||
Amortization of intangible assets related to acquisitions | 2,318 | 2,318 | 1,661 | 4,636 | 3,322 | ||||||||||||||
Adjusted income from continuing operations before adjusted income tax expense | $ | 31,996 | $ | 31,182 | $ | 7,985 | $ | 63,178 | $ | 26,234 | |||||||||
Income tax expense: | |||||||||||||||||||
Income tax expense – U.S. GAAP basis | $ | 10,049 | $ | 9,827 | $ | 1,644 | $ | 19,876 | $ | 7,244 | |||||||||
Tax effect of adjustments: | |||||||||||||||||||
Compensation from acquisition-related agreements | 551 | 501 | 125 | 1,052 | 250 | ||||||||||||||
Amortization of intangible assets related to acquisitions | 902 | 819 | 646 | 1,721 | 1,292 | ||||||||||||||
Adjusted income tax expense | $ | 11,502 | $ | 11,147 | $ | 2,415 | $ | 22,649 | $ | 8,786 | |||||||||
Net income from continuing operations applicable to Piper Jaffray Companies: | |||||||||||||||||||
Net income from continuing operations applicable to Piper Jaffray Companies – U.S. GAAP basis | $ | 18,213 | $ | 17,748 | $ | 4,359 | $ | 35,961 | $ | 15,026 | |||||||||
Adjustments: | |||||||||||||||||||
Compensation from acquisition-related agreements | 865 | 788 | 196 | 1,653 | 392 | ||||||||||||||
Amortization of intangible assets related to acquisitions | 1,416 | 1,499 | 1,015 | 2,915 | 2,030 | ||||||||||||||
Adjusted net income from continuing operations | $ | 20,494 | $ | 20,035 | $ | 5,570 | $ | 40,529 | $ | 17,448 | |||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||||
June 30, | Mar. 31, | June 30, | June 30, | June 30, | |||||||||||||||
(Amounts in thousands, except per share data) | 2014 | 2014 | 2013 | 2014 | 2013 | ||||||||||||||
Net income from continuing operations applicable to Piper Jaffray Companies' common shareholders: | |||||||||||||||||||
Net income from continuing operations applicable to Piper Jaffray Companies' common stockholders – U.S. GAAP basis | $ | 16,717 | $ | 16,089 | $ | 3,970 | $ | 32,806 | $ | 13,479 | |||||||||
Adjustments: | |||||||||||||||||||
Compensation from acquisition-related agreements | 794 | 714 | 179 | 1,508 | 352 | ||||||||||||||
Amortization of intangible assets related to acquisitions | 1,300 | 1,359 | 924 | 2,659 | 1,821 | ||||||||||||||
Adjusted net income from continuing operations applicable to Piper Jaffray Companies' common stockholders | $ | 18,811 | $ | 18,162 | $ | 5,073 | $ | 36,973 | $ | 15,652 | |||||||||
Earnings per diluted common share from continuing operations: | |||||||||||||||||||
Earnings per diluted common share – U.S. GAAP basis | $ | 1.11 | $ | 1.10 | $ | 0.25 | $ | 2.21 | $ | 0.86 | |||||||||
Adjustments: | |||||||||||||||||||
Compensation from acquisition-related agreements | 0.05 | 0.05 | 0.01 | 0.10 | 0.02 | ||||||||||||||
Amortization of intangible assets related to acquisitions | 0.09 | 0.09 | 0.06 | 0.18 | 0.12 | ||||||||||||||
Adjusted earnings per diluted common share from continuing operations | $ | 1.25 | $ | 1.24 | $ | 0.32 | $ | 2.49 | $ | 1.00 |
(1) | Selected Summary Financial Information are non-GAAP measures. Management believes that presenting results and measures on an adjusted basis in conjunction with U.S. GAAP measures provides the most meaningful basis for comparison of its operating results across periods. |
(2) | A non-GAAP measure which excludes revenues related to noncontrolling interests (see (11) below). |
(3) | A non-GAAP measure which excludes compensation expense from acquisition-related agreements. |
(4) | A non-GAAP measure which excludes (a) non-compensation expenses related to noncontrolling interests (see (11) below) and (b) amortization of intangible assets related to acquisitions. |
(5) | A non-GAAP measure which excludes (a) revenues and expenses related to noncontrolling interests (see (11) below), (b) compensation from acquisition-related agreements and (c) amortization of intangible assets related to acquisitions. |
(6) | A non-GAAP measure which represents adjusted income from continuing operations before adjusted income tax expense as a percentage of adjusted net revenues. |
(7) | A non-GAAP measure which excludes the income tax benefit from (a) compensation from acquisition-related agreements and (b) amortization of intangible assets related to acquisitions. |
(8) | A non-GAAP measure which represents net income from continuing operations earned by the Company excluding (a) compensation expense from acquisition-related agreements, (b) amortization of intangible assets related to acquisitions and (c) the income tax expense/(benefit) allocated to the adjustments. |
(9) | Effective tax rate is a non-GAAP measure which is computed based on a quotient, the numerator of which is adjusted income tax expense and the denominator of which is adjusted income from continuing operations before adjusted income tax expense. |
(10) | Piper Jaffray Companies calculates earnings per common share using the two-class method, which requires the allocation of consolidated adjusted net income between common shareholders and participating security holders, which in the case of Piper Jaffray Companies, represents unvested stock with dividend rights. |
(11) | Noncontrolling interests include revenue and expenses from consolidated alternative asset management entities that are not attributable, either directly or indirectly, to Piper Jaffray Companies. |
(12) | A non-GAAP measure which excludes (a) expenses related to noncontrolling interests (see (11) above), (b) compensation from acquisition-related agreements and (c) amortization of intangible assets related to acquisitions. |
(13) | A non-GAAP measure which excludes (a) compensation from acquisition-related agreements and (b) amortization of intangible assets related to acquisitions. |
1 Year Piper Jaffray Companies Chart |
1 Month Piper Jaffray Companies Chart |
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