Piper Jaffray Companies (NYSE: PJC) today announced its financial
results for the quarter ended September 30, 2015.
During the quarter, we produced strong results across most of our
operating businesses relative to markets which became challenging as the
quarter progressed.
Financial Highlights
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Adjusted net income(1) was $7.3 million, or $0.48 per
diluted common share(1), in the third quarter of 2015,
compared to $16.9 million, or $1.03 per diluted common share, in the
third quarter of 2014, and $18.6 million, or $1.19 per diluted common
share, in the second quarter of 2015.
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Excluding a $9.8 million legal settlement, adjusted net income would
have been $13.2 million, or $0.87 per diluted common share, in the
third quarter of 2015.
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Adjusted net revenues(1) were $148.4 million in the third
quarter of 2015, compared to $155.9 million and $163.9 million in the
third quarter of 2014 and the second quarter of 2015, respectively.
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Adjusted pre-tax operating margin(1) was 7.0% in the third
quarter of 2015, compared to 17.3% and 17.8% in the third quarter of
2014 and the second quarter of 2015, respectively.
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Assets under management were $9.4 billion at September 30, 2015,
compared to $12.2 billion in the year-ago period and $11.4 billion at
the end of the second quarter of 2015.
-
Rolling 12 month return on average common shareholders' equity
decreased to 6.3% at September 30, 2015, compared to 10.2% at
September 30, 2014. Our rolling 12 month return on average tangible
common shareholders' equity(2) decreased to 9.0% at
September 30, 2015, compared to 15.2% at September 30, 2014.
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Book value per share increased 7% from September 30, 2014 to $57.03 a
share at September 30, 2015.
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Three Months Ended
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Percent Inc/(Dec)
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Nine Months Ended
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(Amounts in thousands,
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Sept. 30,
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June 30,
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Sept. 30,
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3Q '15
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3Q '15
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Sept. 30,
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Sept. 30,
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Percent
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except per share data)
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2015
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2015
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2014
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vs. 2Q '15
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vs. 3Q '14
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2015
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2014
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Inc/(Dec)
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As Adjusted(1)
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Net revenues
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$
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148,394
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$
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163,879
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$
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155,850
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(9.4)%
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(4.8)%
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$
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468,012
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$
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484,045
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(3.3)%
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Net income
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$
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7,250
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$
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18,634
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$
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16,885
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(61.1)%
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(57.1)%
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$
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44,703
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$
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57,414
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(22.1)%
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Earnings per diluted common share
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$
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0.48
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$
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1.19
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$
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1.03
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(59.7)%
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(53.4)%
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$
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2.83
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$
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3.52
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(19.6)%
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Pre-tax operating margin
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7.0
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%
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17.8
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%
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17.3
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%
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14.8
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%
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18.6
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%
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U.S. GAAP
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Net revenues
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$
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149,617
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$
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164,066
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$
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159,426
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(8.8)%
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(6.2)%
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$
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475,554
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$
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497,590
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(4.4)%
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Net income
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$
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4,831
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$
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16,999
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$
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14,668
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(71.6)%
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(67.1)%
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$
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38,802
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$
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50,629
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(23.4)%
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Earnings per diluted common share
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$
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0.32
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$
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1.08
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$
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0.90
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(70.4)%
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(64.4)%
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$
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2.46
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$
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3.11
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(20.9)%
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Pre-tax operating margin
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4.5
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%
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15.8
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%
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16.1
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%
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13.4
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%
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17.9
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%
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(1)
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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.
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(2)
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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.
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For the third quarter of 2015, on a U.S. GAAP basis, net revenues were
$149.6 million, and net income was $4.8 million, or $0.32 per diluted
common share.
"Our core businesses performed well during the quarter relative to
markets that were volatile and challenging," said Andrew S. Duff,
Chairman and Chief Executive Officer. "In particular, our advisory and
capital raising businesses continued to produce strong results, somewhat
offset by sharp declines in energy-related stocks which adversely
impacted our asset management products and investments."
Third Quarter Results – Non-GAAP Basis
Throughout the
Adjusted Consolidated Results and Business Segment Results sections of
this press release we present financial measures that are not prepared
in accordance with U.S. generally accepted accounting principles ("U.S.
GAAP"). The non-GAAP financial measures include adjustments to exclude
(1) revenues and expenses related to noncontrolling interests, (2)
amortization of intangible assets related to acquisitions, (3)
compensation for acquisition-related agreements and (4) restructuring
and acquisition integration costs. 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. 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."
Adjusted Consolidated Results
For the third quarter of 2015,
adjusted net revenues were $148.4 million, down 5% compared to $155.9
million in the third quarter of 2014. The decrease was due to lower
advisory services and asset management revenues, partially offset by
higher equity and debt financing revenues. Adjusted net revenues
decreased 9% compared to the second quarter of 2015 due to lower equity
and debt financing revenues, partially offset by higher advisory
services revenues.
For the third quarter of 2015, adjusted compensation and benefits
expenses of $95.4 million were essentially flat compared to the third
quarter of 2014. Adjusted compensation and benefits expenses decreased
7% compared to the second quarter of 2015 due primarily to lower
revenues.
For the third quarter of 2015, adjusted compensation and benefits
expenses were 64.3% of adjusted net revenues, compared to 61.5% and
62.6% for the third quarter of 2014 and the second quarter of 2015,
respectively. The adjusted compensation ratio increased compared to both
the year-ago period and the sequential quarter due to compensation
expenses associated with significant hiring in the current year in our
Capital Markets segment to expand our financial institutions group.
Adjusted non-compensation expenses were $42.6 million for the third
quarter of 2015, up 29% and 33% compared to the year-ago period and the
second quarter of 2015, respectively. The increase compared to both
periods was due to higher legal reserves resulting from settlement of a
legal matter totaling $9.8 million on a pre-tax basis.
On an adjusted basis, our effective tax rate was 30.0% for the third
quarter of 2015, compared to 37.2% and 36.2% for the third quarter of
2014 and the second quarter of 2015, respectively. The reduced effective
tax rate for the third quarter of 2015 was due to the impact of
tax-exempt interest income representing a larger proportion of our
pre-tax income.
Business Segment Results
The firm has two reportable
business segments: Capital Markets and Asset Management. Consolidated
net revenues and expenses are fully allocated to these two segments.
Capital Markets
For the quarter, Capital Markets
generated adjusted pre-tax operating income of $10.5 million, compared
to $19.8 million and $24.3 million in the third quarter of 2014 and the
second quarter of 2015, respectively.
Adjusted net revenues were $136.4 million, up slightly compared to the
year-ago period and down 7% compared to the second quarter of 2015.
-
Equity financing revenues of $24.4 million increased 71% compared to
the year-ago period due to more completed transactions and higher
revenue per transaction. Revenues decreased 32% compared to the
sequential quarter due to fewer completed transactions and lower
revenue per transaction.
-
Debt financing revenues were $20.5 million, up 42% compared to the
third quarter of 2014 due to more completed transactions, and down 32%
compared to a very strong second quarter of 2015 due to fewer
completed transactions.
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Advisory services revenues were $47.0 million, down 29% compared to
the robust third quarter of 2014 due to lower revenue per transaction.
Revenues increased 17% compared to the sequential quarter due to more
completed transactions.
-
Equity institutional brokerage revenues of $20.0 million increased 20%
compared to the year-ago period due to higher client trading volumes.
Revenues decreased 2% compared to the second quarter of 2015.
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Fixed income institutional brokerage revenues were $18.3 million, down
20% compared to the third quarter of 2014 due to lower trading gains.
Revenues declined 11% compared to the sequential quarter due to lower
sales credits and reduced trading gains.
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Management and performance fees earned from managing our alternative
asset management funds were $1.9 million, compared to $1.4 million and
$0.6 million in the year-ago period and the sequential quarter,
respectively. The increase compared to the second quarter of 2015 was
due to higher management fees.
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Adjusted investment income, which includes realized and unrealized
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 $6.1 million for the quarter, compared to
$1.6 million in the year-ago period. Adjusted investment income was
not significant in the second quarter of 2015. In the third quarter of
2015, we recorded higher gains on our merchant banking firm
investments compared to both of the prior periods.
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Long-term financing expenses, which primarily represent interest paid
on the firm's variable rate senior notes, were $1.7 million, compared
to $1.6 million in both the year-ago period and the sequential
quarter, respectively.
-
Adjusted operating expenses for the third quarter of 2015 were $125.9
million, up 9% and 4% compared to the third quarter of 2014 and the
second quarter of 2015, respectively. The increase compared to both
periods was due to higher legal reserves.
-
Adjusted segment pre-tax operating margin was 7.7% compared to 14.6%
in the year-ago period and 16.7% in the second quarter of 2015.
Adjusted pre-tax operating margin declined compared to both periods
due to higher non-compensation costs resulting from a legal
settlement, as well as additional expenses associated with our
financial institutions group expansion.
Asset Management
For the quarter ended September 30,
2015, Asset Management generated an adjusted pre-tax operating loss of
$0.1 million, compared to adjusted pre-tax operating income of $7.1
million and $4.9 million in the third quarter of 2014 and the second
quarter of 2015, respectively.
Net revenues were $12.0 million, down 40% and 33% compared to the third
quarter of 2014 and the second quarter of 2015, respectively. The
decrease compared to both periods was due to lower management fees from
decreased assets under management (AUM) driven by market depreciation.
Also, investment losses on firm capital invested in our strategies was
$5.1 million for the current quarter, compared with a loss of $0.3
million and $0.7 million in the third quarter of 2014 and the second
quarter of 2015, respectively.
-
Adjusted operating expenses for the current quarter were $12.1
million, down 6% and 7% compared to the year-ago period and the second
quarter of 2015, respectively, due to lower compensation expenses.
-
Adjusted segment pre-tax operating margin was a negative 1.2%,
compared to 35.7% in the third quarter of 2014 and 27.3% in the second
quarter of 2015. Adjusted segment pre-tax operating margin declined
relative to both periods primarily due to investment losses and lower
management fees.
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AUM was $9.4 billion at the end of the third quarter of 2015, compared
to $12.2 billion in the year-ago period and $11.4 billion at the end
of the second quarter of 2015. The decreases in AUM have been driven
by market depreciation, primarily from our MLP product offerings.
Other Matters
On September 30, 2015, we completed the
purchase of the assets of River Branch Holdings LLC, an equity
investment banking boutique focused on the financial institutions
sector. The acquisition further strengthens our mergers and acquisitions
leadership in the middle markets and adds investment banking resources
dedicated to banks, thrifts, and depository institutions, building upon
the recent expansion of our financial institutions group.
On October 9, 2015, we completed the acquisition of BMO Capital Markets
GKST Inc., BMO's municipal bond sales, trading and origination business.
This acquisition expands our fixed income institutional sales, trading
and underwriting platforms. Additionally, it strengthens our strategic
analytic and advisory capabilities, and supports our growing financial
institutions group with their coverage of bank clients.
In the third quarter of 2015, we incurred $1.5 million of restructuring
and integration charges. These charges principally resulted from
severance benefits and transaction costs related to these acquisitions.
Additionally, we expect to incur approximately $6.0 million to $7.0
million of restructuring and integration costs in the fourth quarter of
2015.
Additional Shareholder Information
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For the Quarter Ended
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Sept. 30, 2015
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June 30, 2015
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Sept 30, 2014
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Full time employees
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1,094
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1,100
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1,029
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Equity financings
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# of transactions
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22
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27
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15
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Capital raised
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$3.0 billion
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$6.1 billion
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$3.5 billion
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Negotiated tax-exempt issuances
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# of transactions
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104
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155
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85
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Par value
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$2.3 billion
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$3.9 billion
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$1.8 billion
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Mergers & acquisitions
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# of transactions
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21
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14
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22
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Aggregate deal value
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$6.9 billion
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$3.5 billion
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$4.7 billion
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Asset Management
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AUM
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$9.4 billion
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$11.4 billion
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$12.2 billion
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Common shareholders’ equity
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$795.4 million
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$789.6 million
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$804.6 million
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Number of common shares outstanding (in thousands)
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13,947
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13,904
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15,109
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Rolling 12 month return on average common shareholders’ equity *
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6.3%
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7.5%
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10.2%
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Rolling 12 month return on average tangible common shareholders’
equity †
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9.0%
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10.8%
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15.2%
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Book value per share
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$57.03
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$56.79
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$53.26
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Tangible book value per share ‡
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$39.36
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$39.60
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$37.05
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*
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Rolling 12 month return on average common shareholders' equity is
computed by dividing net income applicable to Piper Jaffray
Companies' for the last 12 months by average monthly common
shareholders' equity.
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†
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Rolling 12 month return on average tangible common shareholders'
equity is computed by dividing net income applicable to Piper
Jaffray Companies' for the last 12 months by average monthly common
shareholders' equity less average goodwill and identifiable
intangible assets. Management believes that the rolling 12 month
return on average tangible common shareholders' equity is a
meaningful measure of our return on tangible assets deployed in the
business. Average common shareholders’ equity is the most directly
comparable GAAP financial measure to average tangible shareholders’
equity. The following is a reconciliation of average common
shareholders’ equity to average tangible common shareholders’ equity:
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As of
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As of
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As of
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(Amounts in thousands)
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Sept. 30, 2015
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June 30, 2015
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Sept. 30, 2014
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Average common shareholders’ equity
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$
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811,643
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$
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811,208
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$
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759,971
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Deduct: average goodwill and identifiable intangible assets
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241,545
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242,824
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248,568
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Average tangible common shareholders’ equity
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$
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570,098
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$
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568,384
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$
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511,403
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‡
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Tangible book value per share is computed by dividing tangible
common shareholders’ equity by common shares outstanding. Tangible
common shareholders’ equity equals total common shareholders’ equity
less goodwill and identifiable intangible assets. Management
believes that tangible book value per share is a meaningful measure
of the tangible assets deployed in our business. Shareholders’
equity is the most directly comparable GAAP financial measure to
tangible shareholders’ equity. The following is a reconciliation of
shareholders’ equity to tangible shareholders’ equity:
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|
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As of
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As of
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As of
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(Amounts in thousands)
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Sept. 30, 2015
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June 30, 2015
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Sept. 30, 2014
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Common shareholders’ equity
|
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$
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795,385
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|
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$
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789,635
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$
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804,633
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Deduct: goodwill and identifiable intangible assets
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246,362
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238,990
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244,854
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Tangible common shareholders’ equity
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$
|
549,023
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$
|
550,645
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$
|
559,779
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Conference Call
Andrew S. Duff, chairman and chief executive officer, and Debbra L.
Schoneman, chief financial officer, will hold a conference call to
review the financial results on Thur., Oct. 29 at 9 a.m. ET (8 a.m. CT).
The earnings release will be available on or after Oct. 29 at the firm's
Web site at www.piperjaffray.com.
The call can be accessed via webcast or by dialing (888)810-0209 or
(706)902-1361 (international) and referencing reservation #48306907.
Callers should dial in at least 15 minutes prior to the call time. A
replay of the conference call will be available beginning at
approximately 12 p.m. ET Oct. 29 at the same Web address or by calling
(855)859-2056 and referencing reservation #48306907.
About Piper Jaffray
Piper Jaffray is an investment bank and asset management firm serving
clients in the U.S. and internationally. Proven advisory teams combine
deep industry, product and sector expertise with ready access to
capital. Founded in 1895, the firm is headquartered in Minneapolis and
has offices across the United States and in London, Hong Kong and
Zurich. www.piperjaffray.com
Cautionary Note Regarding Forward-Looking Statements
This press release and the conference call to discuss the contents of
this press release contain forward-looking statements. Statements that
are not historical or current facts, including statements about beliefs
and expectations, are forward-looking statements and are subject to
significant risks and uncertainties that are difficult to predict. These
forward-looking statements cover, among other things, statements made
about general economic and market conditions (including the outlook for
equity markets and the interest rate environment), the environment and
prospects for corporate advisory transactions and capital markets
(including our performance in specific sectors and the outlook for the
fourth quarter), anticipated financial results generally (including
expectations regarding our noncompensation expenses, compensation and
benefits expense, compensation ratio (including the impact of our
expansion into the financial institutions sector), revenue levels,
operating margins, earnings per share, effective tax rate, and return on
equity), current deal pipelines (or backlogs), financial results for our
asset management segment (including our performance in specific sectors,
e.g. energy-based MLPs),the liquidity of fixed income markets and impact
on our related inventory, our strategic priorities (including growth in
public finance, asset management, and corporate advisory), potential
acquisitions or strategic hires, the expected benefits of our expansion
into the financial institutions sector within equity investment banking
that includes the acquisition of River Branch Holdings LLC as well as
the acquisition of BMO Capital Markets GKST Inc., or other similar
matters.
Forward-looking statements involve inherent risks and uncertainties,
both known and unknown, and important factors could cause actual results
to differ materially from those anticipated or discussed in the
forward-looking statements. These risks, uncertainties and important
factors include, but are not limited to, the following:
-
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;
-
net revenues from equity and debt financings and corporate advisory
engagements may vary materially depending on the number, size, and
timing of completed transactions, and completed transactions do not
generally provide for subsequent engagements;
-
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;
-
asset management revenue may vary based on investment performance and
market and economic factors, and these factors may impact certain
sectors that are more heavily weighted to our business, e.g.
energy-based MLP funds;
-
interest rate volatility, especially if the changes are rapid or
severe, could negatively impact our fixed income institutional
business and the negative impact could be exaggerated by reduced
liquidity in the fixed income markets;
-
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;
-
potential acquisitions targets or strategic hires may not be available
on reasonable terms or at all, and we may not be able to effectively
integrate any business or groups of employees we acquire or hire, and
the expected benefits of any acquisitions or strategic hires,
including that of River Branch Holdings LLC and BMO Capital Markets
GKST Inc., may take longer than anticipated to achieve and may not be
achieved in their entirety or at all;
-
our stock price may fluctuate as a result of several factors,
including but not limited to, changes in our revenues and operating
results.
A further listing and description of these and other risks,
uncertainties and important factors can be found in the sections titled
“Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K for
the year ended December 31, 2014 and “Management's Discussion and
Analysis of Financial Condition and Results of Operations” in Part II,
Item 7 of our Annual Report on Form 10-K for the year ended December 31,
2014, and updated in our subsequent reports filed with the SEC
(available at our Web site at www.piperjaffray.com
and at the SEC Web site at www.sec.gov).
Forward-looking statements speak only as of the date they are made, and
readers are cautioned not to place undue reliance on them. We undertake
no obligation to update them in light of new information or future
events.
© 2015 Piper Jaffray Companies, 800 Nicollet Mall, Suite 1000,
Minneapolis, Minnesota 55402-7020
Piper Jaffray Companies
Preliminary Results of Operations (U.S. GAAP – Unaudited)
|
|
|
Three Months Ended
|
|
Percent Inc/(Dec)
|
|
Nine Months Ended
|
|
|
|
|
|
|
Sept. 30,
|
|
June 30,
|
|
Sept. 30,
|
|
3Q '15
|
|
3Q '15
|
|
Sept. 30,
|
|
Sept. 30,
|
|
Percent
|
|
(Amounts in thousands, except per share data)
|
|
2015
|
|
2015
|
|
2014
|
|
vs. 2Q '15
|
|
vs. 3Q '14
|
|
2015
|
|
2014
|
|
Inc/(Dec)
|
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment banking
|
|
$
|
91,640
|
|
|
$
|
106,069
|
|
|
$
|
94,911
|
|
|
(13.6
|
)%
|
|
(3.4
|
)%
|
|
$
|
284,786
|
|
|
$
|
287,198
|
|
|
(0.8
|
)%
|
|
Institutional brokerage
|
|
34,182
|
|
|
36,661
|
|
|
35,923
|
|
|
(6.8
|
)
|
|
(4.8
|
)
|
|
106,879
|
|
|
114,485
|
|
|
(6.6
|
)
|
|
Asset management
|
|
18,951
|
|
|
19,257
|
|
|
21,595
|
|
|
(1.6
|
)
|
|
(12.2
|
)
|
|
58,730
|
|
|
64,820
|
|
|
(9.4
|
)
|
|
Interest
|
|
9,128
|
|
|
11,422
|
|
|
10,828
|
|
|
(20.1
|
)
|
|
(15.7
|
)
|
|
32,755
|
|
|
36,935
|
|
|
(11.3
|
)
|
|
Investment income/(loss)
|
|
831
|
|
|
(3,299
|
)
|
|
2,690
|
|
|
N/M
|
|
|
(69.1
|
)
|
|
10,123
|
|
|
12,379
|
|
|
(18.2
|
)
|
|
Total revenues
|
|
154,732
|
|
|
170,110
|
|
|
165,947
|
|
|
(9.0
|
)
|
|
(6.8
|
)
|
|
493,273
|
|
|
515,817
|
|
|
(4.4
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense
|
|
5,115
|
|
|
6,044
|
|
|
6,521
|
|
|
(15.4
|
)
|
|
(21.6
|
)
|
|
17,719
|
|
|
18,227
|
|
|
(2.8
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenues
|
|
149,617
|
|
|
164,066
|
|
|
159,426
|
|
|
(8.8
|
)
|
|
(6.2
|
)
|
|
475,554
|
|
|
497,590
|
|
|
(4.4
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and benefits
|
|
96,132
|
|
|
103,554
|
|
|
97,180
|
|
|
(7.2
|
)
|
|
(1.1
|
)
|
|
295,543
|
|
|
300,745
|
|
|
(1.7
|
)
|
|
Outside services
|
|
9,316
|
|
|
8,885
|
|
|
9,155
|
|
|
4.9
|
|
|
1.8
|
|
|
26,385
|
|
|
27,837
|
|
|
(5.2
|
)
|
|
Occupancy and equipment
|
|
7,025
|
|
|
6,983
|
|
|
8,312
|
|
|
0.6
|
|
|
(15.5
|
)
|
|
20,791
|
|
|
22,151
|
|
|
(6.1
|
)
|
|
Communications
|
|
6,234
|
|
|
5,088
|
|
|
5,661
|
|
|
22.5
|
|
|
10.1
|
|
|
17,650
|
|
|
17,048
|
|
|
3.5
|
|
|
Marketing and business development
|
|
6,965
|
|
|
7,239
|
|
|
6,827
|
|
|
(3.8
|
)
|
|
2.0
|
|
|
21,186
|
|
|
19,787
|
|
|
7.1
|
|
|
Trade execution and clearance
|
|
1,982
|
|
|
1,977
|
|
|
1,905
|
|
|
0.3
|
|
|
4.0
|
|
|
5,956
|
|
|
5,527
|
|
|
7.8
|
|
|
Restructuring and integration costs
|
|
1,496
|
|
|
—
|
|
|
—
|
|
|
N/M
|
|
|
N/M
|
|
|
1,496
|
|
|
—
|
|
|
N/M
|
|
|
Intangible asset amortization expense
|
|
1,773
|
|
|
1,773
|
|
|
2,318
|
|
|
—
|
|
|
(23.5
|
)
|
|
5,319
|
|
|
6,954
|
|
|
(23.5
|
)
|
|
Other operating expenses
|
|
11,906
|
|
|
2,708
|
|
|
2,376
|
|
|
339.7
|
|
|
401.1
|
|
|
17,289
|
|
|
8,719
|
|
|
98.3
|
|
|
Total non-interest expenses
|
|
142,829
|
|
|
138,207
|
|
|
133,734
|
|
|
3.3
|
|
|
6.8
|
|
|
411,615
|
|
|
408,768
|
|
|
0.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income tax expense
|
|
6,788
|
|
|
25,859
|
|
|
25,692
|
|
|
(73.7
|
)
|
|
(73.6
|
)
|
|
63,939
|
|
|
88,822
|
|
|
(28.0
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense
|
|
1,573
|
|
|
9,542
|
|
|
8,596
|
|
|
(83.5
|
)
|
|
(81.7
|
)
|
|
20,605
|
|
|
28,472
|
|
|
(27.6
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
5,215
|
|
|
16,317
|
|
|
17,096
|
|
|
(68.0
|
)
|
|
(69.5
|
)
|
|
43,334
|
|
|
60,350
|
|
|
(28.2
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income/(loss) applicable to noncontrolling interests
|
|
384
|
|
|
(682
|
)
|
|
2,428
|
|
|
N/M
|
|
|
(84.2
|
)
|
|
4,532
|
|
|
9,721
|
|
|
(53.4
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income applicable to Piper Jaffray Companies (a)
|
|
$
|
4,831
|
|
|
$
|
16,999
|
|
|
$
|
14,668
|
|
|
(71.6
|
)%
|
|
(67.1
|
)%
|
|
$
|
38,802
|
|
|
$
|
50,629
|
|
|
(23.4
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income applicable to Piper Jaffray Companies’ common
shareholders (a)
|
|
$
|
4,448
|
|
|
$
|
15,699
|
|
|
$
|
13,552
|
|
|
(71.7
|
)%
|
|
(67.2
|
)%
|
|
$
|
35,908
|
|
|
$
|
46,386
|
|
|
(22.6
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per common share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.32
|
|
|
$
|
1.08
|
|
|
$
|
0.90
|
|
|
(70.4
|
)%
|
|
(64.4
|
)%
|
|
$
|
2.46
|
|
|
$
|
3.12
|
|
|
(21.2
|
)%
|
|
Diluted
|
|
$
|
0.32
|
|
|
$
|
1.08
|
|
|
$
|
0.90
|
|
|
(70.4
|
)%
|
|
(64.4
|
)%
|
|
$
|
2.46
|
|
|
$
|
3.11
|
|
|
(20.9
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of common shares outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
13,938
|
|
|
14,487
|
|
|
15,066
|
|
|
(3.8
|
)%
|
|
(7.5
|
)%
|
|
14,568
|
|
|
14,880
|
|
|
(2.1
|
)%
|
|
Diluted
|
|
13,952
|
|
|
14,513
|
|
|
15,129
|
|
|
(3.9
|
)%
|
|
(7.8
|
)%
|
|
14,594
|
|
|
14,934
|
|
|
(2.3
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(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.
|
|
|
|
N/M — Not meaningful
|
|
|
Piper Jaffray Companies
Preliminary Segment Data (U.S. GAAP – Unaudited)
|
|
|
Three Months Ended
|
|
Percent Inc/(Dec)
|
|
Nine Months Ended
|
|
|
|
|
|
|
Sept. 30,
|
|
June 30,
|
|
Sept. 30,
|
|
3Q '15
|
|
3Q '15
|
|
Sept. 30,
|
|
Sept. 30,
|
|
Percent
|
|
(Dollars in thousands)
|
|
2015
|
|
2015
|
|
2014
|
|
vs. 2Q '15
|
|
vs. 3Q '14
|
|
2015
|
|
2014
|
|
Inc/(Dec)
|
|
Capital Markets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment banking
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financing
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equities
|
|
$
|
24,437
|
|
|
$
|
35,755
|
|
|
$
|
14,269
|
|
|
(31.7
|
)%
|
|
71.3
|
%
|
|
$
|
96,681
|
|
|
$
|
93,628
|
|
|
3.3
|
%
|
|
Debt
|
|
20,476
|
|
|
30,098
|
|
|
14,435
|
|
|
(32.0
|
)
|
|
41.8
|
|
|
72,312
|
|
|
48,148
|
|
|
50.2
|
|
|
Advisory services
|
|
46,958
|
|
|
40,139
|
|
|
66,320
|
|
|
17.0
|
|
|
(29.2
|
)
|
|
116,363
|
|
|
145,743
|
|
|
(20.2
|
)
|
|
Total investment banking
|
|
91,871
|
|
|
105,992
|
|
|
95,024
|
|
|
(13.3
|
)
|
|
(3.3
|
)
|
|
285,356
|
|
|
287,519
|
|
|
(0.8
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Institutional sales and trading
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equities
|
|
20,026
|
|
|
20,407
|
|
|
16,711
|
|
|
(1.9
|
)
|
|
19.8
|
|
|
59,338
|
|
|
59,337
|
|
|
—
|
|
|
Fixed income
|
|
18,259
|
|
|
20,482
|
|
|
22,737
|
|
|
(10.9
|
)
|
|
(19.7
|
)
|
|
59,958
|
|
|
69,060
|
|
|
(13.2
|
)
|
|
Total institutional sales and trading
|
|
38,285
|
|
|
40,889
|
|
|
39,448
|
|
|
(6.4
|
)
|
|
(2.9
|
)
|
|
119,296
|
|
|
128,397
|
|
|
(7.1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Management and performance fees
|
|
1,898
|
|
|
621
|
|
|
1,387
|
|
|
205.6
|
|
|
36.8
|
|
|
3,926
|
|
|
4,512
|
|
|
(13.0
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment income
|
|
7,274
|
|
|
215
|
|
|
5,224
|
|
|
N/M
|
|
|
39.2
|
|
|
22,194
|
|
|
20,600
|
|
|
7.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term financing expenses
|
|
(1,668
|
)
|
|
(1,553
|
)
|
|
(1,613
|
)
|
|
7.4
|
|
|
3.4
|
|
|
(4,781
|
)
|
|
(5,058
|
)
|
|
(5.5
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenues
|
|
137,660
|
|
|
146,164
|
|
|
139,470
|
|
|
(5.8
|
)
|
|
(1.3
|
)
|
|
425,991
|
|
|
435,970
|
|
|
(2.3
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses
|
|
129,224
|
|
|
123,687
|
|
|
119,001
|
|
|
4.5
|
|
|
8.6
|
|
|
369,114
|
|
|
364,622
|
|
|
1.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment pre-tax operating income
|
|
$
|
8,436
|
|
|
$
|
22,477
|
|
|
$
|
20,469
|
|
|
(62.5
|
)%
|
|
(58.8
|
)%
|
|
$
|
56,877
|
|
|
$
|
71,348
|
|
|
(20.3
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment pre-tax operating margin
|
|
6.1
|
%
|
|
15.4
|
%
|
|
14.7
|
%
|
|
|
|
|
|
|
|
13.4
|
%
|
|
16.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset Management
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Management and performance fees
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Management fees
|
|
$
|
17,053
|
|
|
$
|
18,436
|
|
|
$
|
19,738
|
|
|
(7.5
|
)%
|
|
(13.6
|
)%
|
|
$
|
54,596
|
|
|
$
|
59,474
|
|
|
(8.2
|
)%
|
|
Performance fees
|
|
—
|
|
|
200
|
|
|
470
|
|
|
N/M
|
|
|
N/M
|
|
|
208
|
|
|
834
|
|
|
(75.1
|
)
|
|
Total management and performance fees
|
|
17,053
|
|
|
18,636
|
|
|
20,208
|
|
|
(8.5
|
)
|
|
(15.6
|
)
|
|
54,804
|
|
|
60,308
|
|
|
(9.1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment income/(loss)
|
|
(5,096
|
)
|
|
(734
|
)
|
|
(252
|
)
|
|
594.3
|
|
|
N/M
|
|
|
(5,241
|
)
|
|
1,312
|
|
|
N/M
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenues
|
|
11,957
|
|
|
17,902
|
|
|
19,956
|
|
|
(33.2
|
)
|
|
(40.1
|
)
|
|
49,563
|
|
|
61,620
|
|
|
(19.6
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses
|
|
13,605
|
|
|
14,520
|
|
|
14,733
|
|
|
(6.3
|
)
|
|
(7.7
|
)
|
|
42,501
|
|
|
44,146
|
|
|
(3.7
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment pre-tax operating income/(loss)
|
|
$
|
(1,648
|
)
|
|
$
|
3,382
|
|
|
$
|
5,223
|
|
|
N/M
|
|
|
N/M
|
|
|
$
|
7,062
|
|
|
$
|
17,474
|
|
|
(59.6
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment pre-tax operating margin
|
|
(13.8
|
)%
|
|
18.9
|
%
|
|
26.2
|
%
|
|
|
|
|
|
|
|
14.2
|
%
|
|
28.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenues
|
|
$
|
149,617
|
|
|
$
|
164,066
|
|
|
$
|
159,426
|
|
|
(8.8
|
)%
|
|
(6.2
|
)%
|
|
$
|
475,554
|
|
|
$
|
497,590
|
|
|
(4.4
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses
|
|
142,829
|
|
|
138,207
|
|
|
133,734
|
|
|
3.3
|
|
|
6.8
|
|
|
411,615
|
|
|
408,768
|
|
|
0.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pre-tax operating income
|
|
$
|
6,788
|
|
|
$
|
25,859
|
|
|
$
|
25,692
|
|
|
(73.7
|
)%
|
|
(73.6
|
)%
|
|
$
|
63,939
|
|
|
$
|
88,822
|
|
|
(28.0
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pre-tax operating margin
|
|
4.5
|
%
|
|
15.8
|
%
|
|
16.1
|
%
|
|
|
|
|
|
|
|
13.4
|
%
|
|
17.9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
N/M — Not meaningful
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Piper Jaffray Companies
Preliminary Selected Summary Financial Information (Non-GAAP –
Unaudited) (1)
|
|
|
Three Months Ended
|
|
Percent Inc/(Dec)
|
|
Nine Months Ended
|
|
|
|
|
|
|
Sept. 30,
|
|
June 30,
|
|
Sept. 30,
|
|
3Q '15
|
|
3Q '15
|
|
Sept. 30,
|
|
Sept. 30,
|
|
Percent
|
|
(Amounts in thousands, except per share data)
|
|
2015
|
|
2015
|
|
2014
|
|
vs. 2Q '15
|
|
vs. 3Q '14
|
|
2015
|
|
2014
|
|
Inc/(Dec)
|
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment banking
|
|
$
|
91,640
|
|
|
$
|
106,069
|
|
|
$
|
94,911
|
|
|
(13.6
|
)%
|
|
(3.4
|
)%
|
|
$
|
284,786
|
|
|
$
|
287,198
|
|
|
(0.8
|
)%
|
|
Institutional brokerage
|
|
34,182
|
|
|
36,661
|
|
|
35,923
|
|
|
(6.8
|
)
|
|
(4.8
|
)
|
|
106,879
|
|
|
114,485
|
|
|
(6.6
|
)
|
|
Asset management
|
|
18,951
|
|
|
19,257
|
|
|
21,595
|
|
|
(1.6
|
)
|
|
(12.2
|
)
|
|
58,730
|
|
|
64,820
|
|
|
(9.4
|
)
|
|
Interest
|
|
7,885
|
|
|
8,114
|
|
|
8,028
|
|
|
(2.8
|
)
|
|
(1.8
|
)
|
|
25,244
|
|
|
27,835
|
|
|
(9.3
|
)
|
|
Investment income/(loss)
|
|
631
|
|
|
(1,151
|
)
|
|
859
|
|
|
N/M
|
|
|
(26.5
|
)
|
|
7,932
|
|
|
5,106
|
|
|
55.3
|
|
|
Total revenues
|
|
153,289
|
|
|
168,950
|
|
|
161,316
|
|
|
(9.3
|
)
|
|
(5.0
|
)
|
|
483,571
|
|
|
499,444
|
|
|
(3.2
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense
|
|
4,895
|
|
|
5,071
|
|
|
5,466
|
|
|
(3.5
|
)
|
|
(10.4
|
)
|
|
15,559
|
|
|
15,399
|
|
|
1.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net revenues (2)
|
|
$
|
148,394
|
|
|
$
|
163,879
|
|
|
$
|
155,850
|
|
|
(9.4
|
)%
|
|
(4.8
|
)%
|
|
$
|
468,012
|
|
|
$
|
484,045
|
|
|
(3.3
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted compensation and benefits (3)
|
|
$
|
95,442
|
|
|
$
|
102,650
|
|
|
$
|
95,869
|
|
|
(7.0
|
)%
|
|
(0.4
|
)%
|
|
$
|
292,698
|
|
|
$
|
296,729
|
|
|
(1.4
|
)%
|
|
Ratio of adjusted compensation and benefits to adjusted net
revenues
|
|
64.3
|
%
|
|
62.6
|
%
|
|
61.5
|
%
|
|
|
|
|
|
|
|
62.5
|
%
|
|
61.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted non-compensation expenses (4)
|
|
$
|
42,589
|
|
|
$
|
32,011
|
|
|
$
|
33,088
|
|
|
33.0
|
%
|
|
28.7
|
%
|
|
$
|
106,247
|
|
|
$
|
97,245
|
|
|
9.3
|
%
|
|
Ratio of adjusted non-compensation expenses to adjusted net
revenues
|
|
28.7
|
%
|
|
19.5
|
%
|
|
21.2
|
%
|
|
|
|
|
|
|
|
22.7
|
%
|
|
20.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted income before adjusted income tax expense (5)
|
|
$
|
10,363
|
|
|
$
|
29,218
|
|
|
$
|
26,893
|
|
|
(64.5
|
)%
|
|
(61.5
|
)%
|
|
$
|
69,067
|
|
|
$
|
90,071
|
|
|
(23.3
|
)%
|
|
Adjusted operating margin (6)
|
|
7.0
|
%
|
|
17.8
|
%
|
|
17.3
|
%
|
|
|
|
|
|
|
|
14.8
|
%
|
|
18.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted income tax expense (7)
|
|
3,113
|
|
|
10,584
|
|
|
10,008
|
|
|
(70.6
|
)
|
|
(68.9
|
)
|
|
24,364
|
|
|
32,657
|
|
|
(25.4
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net income (8)
|
|
$
|
7,250
|
|
|
$
|
18,634
|
|
|
$
|
16,885
|
|
|
(61.1
|
)%
|
|
(57.1
|
)%
|
|
$
|
44,703
|
|
|
$
|
57,414
|
|
|
(22.1
|
)%
|
|
Effective tax rate (9)
|
|
30.0
|
%
|
|
36.2
|
%
|
|
37.2
|
%
|
|
|
|
|
|
|
|
35.3
|
%
|
|
36.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net income applicable to Piper Jaffray Companies’ common
shareholders (10)
|
|
$
|
6,676
|
|
|
$
|
17,209
|
|
|
$
|
15,600
|
|
|
(61.2
|
)%
|
|
(57.2
|
)%
|
|
$
|
41,369
|
|
|
$
|
52,602
|
|
|
(21.4
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted earnings per diluted common share
|
|
$
|
0.48
|
|
|
$
|
1.19
|
|
|
$
|
1.03
|
|
|
(59.7
|
)%
|
|
(53.4
|
)%
|
|
$
|
2.83
|
|
|
$
|
3.52
|
|
|
(19.6
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of common shares outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted
|
|
13,952
|
|
|
14,513
|
|
|
15,129
|
|
|
(3.9
|
)%
|
|
(7.8
|
)%
|
|
14,594
|
|
|
14,934
|
|
|
(2.3
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
This presentation includes non-GAAP measures. The non-GAAP measures
are not meant to be considered in isolation or as a substitute for the
corresponding U.S. GAAP measures, and should be read only in conjunction
with our consolidated financial statements prepared in accordance with
U.S. GAAP. 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."
N/M — Not meaningful
Piper Jaffray Companies
Preliminary Adjusted Segment Data (Non-GAAP – Unaudited)
|
|
|
Three Months Ended
|
|
Percent Inc/(Dec)
|
|
Nine Months Ended
|
|
|
|
|
|
|
Sept. 30,
|
|
June 30,
|
|
Sept. 30,
|
|
3Q '15
|
|
3Q '15
|
|
Sept. 30,
|
|
Sept. 30,
|
|
Percent
|
|
(Dollars in thousands)
|
|
2015
|
|
2015
|
|
2014
|
|
vs. 2Q '15
|
|
vs. 3Q '14
|
|
2015
|
|
2014
|
|
Inc/(Dec)
|
|
Capital Markets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment banking
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financing
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equities
|
|
$
|
24,437
|
|
|
$
|
35,755
|
|
|
$
|
14,269
|
|
|
(31.7
|
)%
|
|
71.3
|
%
|
|
$
|
96,681
|
|
|
$
|
93,628
|
|
|
3.3
|
%
|
|
Debt
|
|
20,476
|
|
|
30,098
|
|
|
14,435
|
|
|
(32.0
|
)
|
|
41.8
|
|
|
72,312
|
|
|
48,148
|
|
|
50.2
|
|
|
Advisory services
|
|
46,958
|
|
|
40,139
|
|
|
66,320
|
|
|
17.0
|
|
|
(29.2
|
)
|
|
116,363
|
|
|
145,743
|
|
|
(20.2
|
)
|
|
Total investment banking
|
|
91,871
|
|
|
105,992
|
|
|
95,024
|
|
|
(13.3
|
)
|
|
(3.3
|
)
|
|
285,356
|
|
|
287,519
|
|
|
(0.8
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Institutional sales and trading
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equities
|
|
20,026
|
|
|
20,407
|
|
|
16,711
|
|
|
(1.9
|
)
|
|
19.8
|
|
|
59,338
|
|
|
59,337
|
|
|
—
|
|
|
Fixed income
|
|
18,259
|
|
|
20,482
|
|
|
22,737
|
|
|
(10.9
|
)
|
|
(19.7
|
)
|
|
59,958
|
|
|
69,060
|
|
|
(13.2
|
)
|
|
Total institutional sales and trading
|
|
38,285
|
|
|
40,889
|
|
|
39,448
|
|
|
(6.4
|
)
|
|
(2.9
|
)
|
|
119,296
|
|
|
128,397
|
|
|
(7.1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Management and performance fees
|
|
1,898
|
|
|
621
|
|
|
1,387
|
|
|
205.6
|
|
|
36.8
|
|
|
3,926
|
|
|
4,512
|
|
|
(13.0
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment income
|
|
6,051
|
|
|
28
|
|
|
1,648
|
|
|
N/M
|
|
|
267.2
|
|
|
14,652
|
|
|
7,055
|
|
|
107.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term financing expenses
|
|
(1,668
|
)
|
|
(1,553
|
)
|
|
(1,613
|
)
|
|
7.4
|
|
|
3.4
|
|
|
(4,781
|
)
|
|
(5,058
|
)
|
|
(5.5
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net revenues (2)
|
|
136,437
|
|
|
145,977
|
|
|
135,894
|
|
|
(6.5
|
)
|
|
0.4
|
|
|
418,449
|
|
|
422,425
|
|
|
(0.9
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted operating expenses (12)
|
|
125,936
|
|
|
121,651
|
|
|
116,120
|
|
|
3.5
|
|
|
8.5
|
|
|
361,188
|
|
|
355,516
|
|
|
1.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted segment pre-tax operating income (5)
|
|
$
|
10,501
|
|
|
$
|
24,326
|
|
|
$
|
19,774
|
|
|
(56.8
|
)%
|
|
(46.9
|
)%
|
|
$
|
57,261
|
|
|
$
|
66,909
|
|
|
(14.4
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted segment pre-tax operating margin (6)
|
|
7.7
|
%
|
|
16.7
|
%
|
|
14.6
|
%
|
|
|
|
|
|
|
|
13.7
|
%
|
|
15.8
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset Management
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Management and performance fees
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Management fees
|
|
$
|
17,053
|
|
|
$
|
18,436
|
|
|
$
|
19,738
|
|
|
(7.5
|
)%
|
|
(13.6
|
)%
|
|
$
|
54,596
|
|
|
$
|
59,474
|
|
|
(8.2
|
)%
|
|
Performance fees
|
|
—
|
|
|
200
|
|
|
470
|
|
|
N/M
|
|
|
N/M
|
|
|
208
|
|
|
834
|
|
|
(75.1
|
)
|
|
Total management and performance fees
|
|
17,053
|
|
|
18,636
|
|
|
20,208
|
|
|
(8.5
|
)
|
|
(15.6
|
)
|
|
54,804
|
|
|
60,308
|
|
|
(9.1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment income/(loss)
|
|
(5,096
|
)
|
|
(734
|
)
|
|
(252
|
)
|
|
594.3
|
|
|
N/M
|
|
|
(5,241
|
)
|
|
1,312
|
|
|
N/M
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenues
|
|
11,957
|
|
|
17,902
|
|
|
19,956
|
|
|
(33.2
|
)
|
|
(40.1
|
)
|
|
49,563
|
|
|
61,620
|
|
|
(19.6
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted operating expenses (13)
|
|
12,095
|
|
|
13,010
|
|
|
12,837
|
|
|
(7.0
|
)
|
|
(5.8
|
)
|
|
37,757
|
|
|
38,458
|
|
|
(1.8
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted segment pre-tax operating income/(loss) (13)
|
|
$
|
(138
|
)
|
|
$
|
4,892
|
|
|
$
|
7,119
|
|
|
N/M
|
|
|
N/M
|
|
|
$
|
11,806
|
|
|
$
|
23,162
|
|
|
(49.0
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted segment pre-tax operating margin (6)
|
|
(1.2
|
)%
|
|
27.3
|
%
|
|
35.7
|
%
|
|
|
|
|
|
|
|
23.8
|
%
|
|
37.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net revenues (2)
|
|
$
|
148,394
|
|
|
$
|
163,879
|
|
|
$
|
155,850
|
|
|
(9.4
|
)%
|
|
(4.8
|
)%
|
|
$
|
468,012
|
|
|
$
|
484,045
|
|
|
(3.3
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted operating expenses (12)
|
|
138,031
|
|
|
134,661
|
|
|
128,957
|
|
|
2.5
|
|
|
7.0
|
|
|
398,945
|
|
|
393,974
|
|
|
1.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted pre-tax operating income (5)
|
|
$
|
10,363
|
|
|
$
|
29,218
|
|
|
$
|
26,893
|
|
|
(64.5
|
)%
|
|
(61.5
|
)%
|
|
$
|
69,067
|
|
|
$
|
90,071
|
|
|
(23.3
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted pre-tax operating margin (6)
|
|
7.0
|
%
|
|
17.8
|
%
|
|
17.3
|
%
|
|
|
|
|
|
|
|
14.8
|
%
|
|
18.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
This presentation includes non-GAAP measures. The non-GAAP measures
are not meant to be considered in isolation or as a substitute for the
corresponding U.S. GAAP measures, and should be read only in conjunction
with our consolidated financial statements prepared in accordance with
U.S. GAAP. 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."
N/M — Not meaningful
Piper Jaffray Companies
Reconciliation of U.S. GAAP to Selected Summary Financial Information
(1) (Unaudited)
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
|
|
Sept. 30,
|
|
June 30,
|
|
Sept. 30,
|
|
Sept. 30,
|
|
Sept. 30,
|
|
(Amounts in thousands, except per share data)
|
|
2015
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
Net revenues:
|
|
|
|
|
|
|
|
|
|
|
|
Net revenues – U.S. GAAP basis
|
|
$
|
149,617
|
|
|
$
|
164,066
|
|
|
$
|
159,426
|
|
|
$
|
475,554
|
|
|
$
|
497,590
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
Revenue related to noncontrolling interests (11)
|
|
(1,223
|
)
|
|
(187
|
)
|
|
(3,576
|
)
|
|
(7,542
|
)
|
|
(13,545
|
)
|
|
Adjusted net revenues
|
|
$
|
148,394
|
|
|
$
|
163,879
|
|
|
$
|
155,850
|
|
|
$
|
468,012
|
|
|
$
|
484,045
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and benefits:
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and benefits – U.S. GAAP basis
|
|
$
|
96,132
|
|
|
$
|
103,554
|
|
|
$
|
97,180
|
|
|
$
|
295,543
|
|
|
$
|
300,745
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
Compensation from acquisition-related agreements
|
|
(690
|
)
|
|
(904
|
)
|
|
(1,311
|
)
|
|
(2,845
|
)
|
|
(4,016
|
)
|
|
Adjusted compensation and benefits
|
|
$
|
95,442
|
|
|
$
|
102,650
|
|
|
$
|
95,869
|
|
|
$
|
292,698
|
|
|
$
|
296,729
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-compensation expenses:
|
|
|
|
|
|
|
|
|
|
|
|
Non-compensation expenses – U.S. GAAP basis
|
|
$
|
46,697
|
|
|
$
|
34,653
|
|
|
$
|
36,554
|
|
|
$
|
116,072
|
|
|
$
|
108,023
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
Non-compensation expenses related to noncontrolling interests (11)
|
|
(839
|
)
|
|
(869
|
)
|
|
(1,148
|
)
|
|
(3,010
|
)
|
|
(3,824
|
)
|
|
Restructuring and integration costs
|
|
(1,496
|
)
|
|
—
|
|
|
—
|
|
|
(1,496
|
)
|
|
—
|
|
|
Amortization of intangible assets related to acquisitions
|
|
(1,773
|
)
|
|
(1,773
|
)
|
|
(2,318
|
)
|
|
(5,319
|
)
|
|
(6,954
|
)
|
|
Adjusted non-compensation expenses
|
|
$
|
42,589
|
|
|
$
|
32,011
|
|
|
$
|
33,088
|
|
|
$
|
106,247
|
|
|
$
|
97,245
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income tax expense:
|
|
|
|
|
|
|
|
|
|
|
|
Income before income tax expense – U.S. GAAP basis
|
|
$
|
6,788
|
|
|
$
|
25,859
|
|
|
$
|
25,692
|
|
|
$
|
63,939
|
|
|
$
|
88,822
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
Revenue related to noncontrolling interests (11)
|
|
(1,223
|
)
|
|
(187
|
)
|
|
(3,576
|
)
|
|
(7,542
|
)
|
|
(13,545
|
)
|
|
Expenses related to noncontrolling interests (11)
|
|
839
|
|
|
869
|
|
|
1,148
|
|
|
3,010
|
|
|
3,824
|
|
|
Compensation from acquisition-related agreements
|
|
690
|
|
|
904
|
|
|
1,311
|
|
|
2,845
|
|
|
4,016
|
|
|
Restructuring and integration costs
|
|
1,496
|
|
|
—
|
|
|
—
|
|
|
1,496
|
|
|
—
|
|
|
Amortization of intangible assets related to acquisitions
|
|
1,773
|
|
|
1,773
|
|
|
2,318
|
|
|
5,319
|
|
|
6,954
|
|
|
Adjusted income before adjusted income tax expense
|
|
$
|
10,363
|
|
|
$
|
29,218
|
|
|
$
|
26,893
|
|
|
$
|
69,067
|
|
|
$
|
90,071
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense:
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense – U.S. GAAP basis
|
|
$
|
1,573
|
|
|
$
|
9,542
|
|
|
$
|
8,596
|
|
|
$
|
20,605
|
|
|
$
|
28,472
|
|
|
Tax effect of adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
Compensation from acquisition-related agreements
|
|
268
|
|
|
352
|
|
|
510
|
|
|
1,107
|
|
|
1,562
|
|
|
Restructuring and integration costs
|
|
582
|
|
|
—
|
|
|
—
|
|
|
582
|
|
|
—
|
|
|
Amortization of intangible assets related to acquisitions
|
|
690
|
|
|
690
|
|
|
902
|
|
|
2,070
|
|
|
2,623
|
|
|
Adjusted income tax expense
|
|
$
|
3,113
|
|
|
$
|
10,584
|
|
|
$
|
10,008
|
|
|
$
|
24,364
|
|
|
$
|
32,657
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income applicable to Piper Jaffray Companies:
|
|
|
|
|
|
|
|
|
|
|
|
Net income applicable to Piper Jaffray Companies – U.S. GAAP basis
|
|
$
|
4,831
|
|
|
$
|
16,999
|
|
|
$
|
14,668
|
|
|
$
|
38,802
|
|
|
$
|
50,629
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
Compensation from acquisition-related agreements
|
|
422
|
|
|
552
|
|
|
801
|
|
|
1,738
|
|
|
2,454
|
|
|
Restructuring and integration costs
|
|
914
|
|
|
—
|
|
|
—
|
|
|
914
|
|
|
—
|
|
|
Amortization of intangible assets related to acquisitions
|
|
1,083
|
|
|
1,083
|
|
|
1,416
|
|
|
3,249
|
|
|
4,331
|
|
|
Adjusted net income
|
|
$
|
7,250
|
|
|
$
|
18,634
|
|
|
$
|
16,885
|
|
|
$
|
44,703
|
|
|
$
|
57,414
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income applicable to Piper Jaffray Companies' common
shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
Net income applicable to Piper Jaffray Companies' common
stockholders – U.S. GAAP basis
|
|
$
|
4,448
|
|
|
$
|
15,699
|
|
|
$
|
13,552
|
|
|
$
|
35,908
|
|
|
$
|
46,386
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
Compensation from acquisition-related agreements
|
|
389
|
|
|
510
|
|
|
740
|
|
|
1,608
|
|
|
2,248
|
|
|
Restructuring and integration costs
|
|
842
|
|
|
—
|
|
|
—
|
|
|
846
|
|
|
—
|
|
|
Amortization of intangible assets related to acquisitions
|
|
997
|
|
|
1,000
|
|
|
1,308
|
|
|
3,007
|
|
|
3,968
|
|
|
Adjusted net income applicable to Piper Jaffray Companies' common
stockholders
|
|
$
|
6,676
|
|
|
$
|
17,209
|
|
|
$
|
15,600
|
|
|
$
|
41,369
|
|
|
$
|
52,602
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per diluted common share:
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per diluted common share – U.S. GAAP basis
|
|
$
|
0.32
|
|
|
$
|
1.08
|
|
|
$
|
0.90
|
|
|
$
|
2.46
|
|
|
$
|
3.11
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
Compensation from acquisition-related agreements
|
|
0.03
|
|
|
0.04
|
|
|
0.05
|
|
|
0.11
|
|
|
0.15
|
|
|
Restructuring and integration costs
|
|
0.06
|
|
|
—
|
|
|
—
|
|
|
0.06
|
|
|
—
|
|
|
Amortization of intangible assets related to acquisitions
|
|
0.07
|
|
|
0.07
|
|
|
0.09
|
|
|
0.21
|
|
|
0.27
|
|
|
Adjusted earnings per diluted common share
|
|
$
|
0.48
|
|
|
$
|
1.19
|
|
|
$
|
1.03
|
|
|
$
|
2.83
|
|
|
$
|
3.52
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
This presentation includes non-GAAP measures. The non-GAAP
measures are not meant to be considered in isolation or as a substitute
for the corresponding U.S. GAAP measures, and should be read only in
conjunction with our consolidated financial statements prepared in
accordance with U.S. GAAP.
Piper Jaffray Companies
Notes to Non-GAAP Financial Schedules
|
(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), (b)
restructuring and integration costs and (c) 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, (c) restructuring and integration
costs and (d) amortization of intangible assets related to
acquisitions.
|
|
|
|
|
|
(6)
|
|
A non-GAAP measure which represents adjusted income 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, (b) restructuring
and integration costs and (c) amortization of intangible assets
related to acquisitions.
|
|
|
|
|
|
(8)
|
|
A non-GAAP measure which represents net income earned by the Company
excluding (a) compensation expense from acquisition-related
agreements, (b) restructuring and integration costs, (c)
amortization of intangible assets related to acquisitions and (d)
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 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, (c) restructuring and integration
costs and (d) 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.
|
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