EX-99.1 2 k8pressrelease.htm RJF PRESS RELEASE RJF Press Release Exhibit 99.1
 
 
Release No. 0706-05      FOR IMMEDIATE RELEASE
 
 
July 26, 2006   
 
RAYMOND JAMES FINANCIAL, INC.
ANNOUNCES THIRD QUARTER RESULTS;
REPORTS RECORD REVENUE

ST. PETERSBURG, Fla. - Raymond James Financial, Inc. today reported a 75 percent increase over the prior year’s quarter in unaudited net income to $56,774,000, or $0.48 per diluted share, for the third quarter ended June 30, 2006. In comparison, the firm earned $32,382,000, or $0.29 per diluted share, for fiscal 2005’s third quarter. Net revenues increased 28 percent to $629,668,000, setting another quarterly record.
Unaudited net income for the nine months of fiscal 2006 was reported at $163,414,000, up 54 percent from 2005’s $106,322,000, while net revenues for the period increased 19 percent to $1,749,006,000 from $1,475,647,000 the previous year. Diluted earnings per share were $1.41, up from $0.94 for last year’s comparable period.
The company’s results include a one-time adjustment to financial service fees related to a change from recording IRA fees on a cash basis to an accrual basis. Excluding this $8.2 million favorable adjustment, net revenues were $621,498,000, up 26 percent over the prior year, and net income was $51,709,000 or $0.44 per diluted share for the quarter, up 52 percent from the prior year’s $0.29 per diluted share.
Year-to-date operating earnings, excluding the financial service fee adjustment in the current quarter and the gain on the sale of seats on the NYSE and Montreal Stock exchanges in the previous quarter, were $148,033,000, or $1.28 per diluted share, up 36 percent from the prior year’s $0.94 per diluted share.

-more-


Release No. 0706-05       Raymond James Financial, Inc.
Page 2

“Given the erratic behavior of the stock market arising from renewed hostilities in the Middle East, higher gas prices and continued increases in interest rates to stem inflationary pressures, our revenues and earnings results in our third fiscal quarter were remarkably good. The uncertainty occasioned by the aforementioned economic and political factors, as well as the heightened activity of insurgents in Iraq, obviously impacts investor confidence and activity negatively,” stated Chairman and CEO Thomas A. James.
“All segments of our business contributed to profit improvement. The increase in the Private Client Group segment’s contribution, resulting from higher levels of commissions and fees, excellent recruiting results, and lower legal activity, was the major factor in the improvement.
“Although U.S. corporate earnings continue to be surprising on the upside, it is unlikely that the underlying negative conditions, which are not controllable, at least by us, won’t begin to impinge on results. One can already see lower rates of new issue activity and a flattening in the growth rate of assets under management as the market loses its positive momentum. Accordingly, I’m less optimistic about the near-term outlook.”
The company will conduct its quarterly conference call July 27 at 4:15 p.m. EST. The telephone number is 800-773-5520. The call will also be available on demand on the company’s Web site, raymondjames.com, under “About Raymond James Financial,” “Financial Reports.” The subjects to be covered may also include forward-looking information. Questions may be posed to management by participants on the call, and in response the company may disclose additional material information.

-more-


Release No. 0706-05       Raymond James Financial, Inc.
Page 3

Raymond James Financial (NYSE-RJF) is a Florida-based diversified holding company providing financial services to individuals, corporations and municipalities through its subsidiary companies. Its three wholly owned broker/dealers, Raymond James & Associates, Raymond James Financial Services and Raymond James Ltd., have more than 4,800 financial advisors serving approximately 1.4 million accounts in 2,200 locations throughout the United States, Canada and overseas. In addition, total client assets are approximately $169 billion, of which $31.6 billion are managed by the firm’s asset management subsidiaries.
To the extent that Raymond James makes or publishes forward-looking statements (regarding economic conditions, management expectations, strategic objectives, business prospects, anticipated expense savings, financial results, anticipated results of litigation and regulatory proceedings, and other similar matters), a variety of factors, many of which are beyond Raymond James’ control, could cause actual results and experiences to differ materially from the expectations and objectives expressed in these statements. These factors are described in Raymond James’ 2005 annual report on Form 10-K, which is available on raymondjames.com and sec.gov.
-more-


Release No. 0706-05       Raymond James Financial, Inc.
Page 4
Raymond James Financial, Inc.
Unaudited Report
For the third quarter ended June 30, 2006
(all data in thousands, except per share earnings)
                       
 
Third Quarter
  
Nine Months
 
2006
  
2005
  
Percent Change
  
2006
  
2005
  
Percent Change
Gross revenues
$711,357
  
$526,362
  
35%
  
$1,943,522
  
$1,563,066
  
24%
Net revenues
629,668
  
493,544
  
28%
  
1,749,006
  
1,475,647
  
19%
Net income
56,774
  
32,382
  
75%
  
163,414
  
106,322
  
54%
                       
Earnings per share - diluted
0.48
  
0.29
  
66%
  
1.41
  
0.94
  
50%
 
                      
Weighted average common and common
                      
equivalent shares outstanding - diluted
116,960
  
113,382
      
115,556
  
113,240
    
                       

 
Balance Sheet Data
               
 
June
  
March
  
Sept.
  
June
 
2006
  
2006
  
2005
  
2005
Total assets
$10.8 bil.
  
$10.1 bil.
  
$ 8.4 bil.
  
$7.8 bil.
Shareholders' equity
$1,444 mil.
  
$1,380 mil.
  
$1,242 mil.
  
$1,192 mil.
Book value per share
$12.40
  
$11.88
  
$10.95
  
$15.82
               
 
Management Data
     
Quarter Ended
    
 
June
  
March
  
Sept.
  
June
 
2006
  
2006
  
2005
  
2005
Total financial advisors:
              
United States
4,529
  
4,544
  
4,591
  
4,537
Canada
323
  
314
  
295
  
282
               
# Lead managed/co-managed
Corporate public offerings in U.S.
27
  
21
  
32
  
20
Corporate public offerings in Canada
7
  
5
  
5
  
3
               
Financial assets under management
$31.6 bil.
  
$31.2 bil.
  
$ 27.5 bil.
  
$26.2 bil.

- more -



Release No. 0706-05       Raymond James Financial, Inc.
Page 5

               
 
June
  
March
  
Sept.
  
June
 
2006
  
2006
  
2005
  
2005
               
Client Assets
$ 169 bil.
  
$ 167 bil.
  
$ 151 bil.
  
$ 142 bil.
Client Margin Balances
$1,405 mil.
  
$1,335 mil.
  
$1,230 mil.
  
$1,214 mil.


 
Three Months Ended
  
Nine Months Ended
 
June 30,
  
June 24,
  
June 30,
  
June 24,
 
2006
  
2005
  
2006
  
2005
Revenues:
              
  Private Client Group
$ 458,622
  
$ 341,010
  
$ 1,251,272
  
$ 1,019,478
  Capital Markets
133,004
  
107,378
  
361,796
  
331,202
  Asset Management
51,384
  
43,689
  
146,459
  
125,661
  RJBank
28,457
  
12,243
  
68,975
  
31,046
  Emerging Markets
17,511
  
8,213
  
43,360
  
27,521
  Stock Loan/ Borrow
16,850
  
8,797
  
42,605
  
21,386
  Other
5,529
  
5,032
  
29,055
  
6,772
     Total
$ 711,357
  
$ 526,362
  
$1,943,522
  
$1,563,066

Pre-tax Income:
              
  Private Client Group
$ 54,246 
  
$ 17,989 
  
$ 129,588 
  
$ 81,634
  Capital Markets
20,904 
  
15,210 
  
57,564 
  
45,504
  Asset Management
12,955 
  
10,292 
  
35,072 
  
29,107
  RJBank
4,632 
  
3,379 
  
10,058 
  
9,457
  Emerging Markets
3,830 
  
1,222 
  
7,393 
  
3,960
  Stock Loan/ Borrow
2,422 
  
2,046 
  
6,970 
  
4,381
  Other
(2,487)
  
1,338 
  
16,502 
  
367
Pre-tax Income
96,502 
  
51,476 
  
263,147 
  
174,410
               
Minority Interest
(2,173)
  
(512)
  
(6,734)
  
2,178
               
Total
$ 94,329 
  
$ 50,964 
  
$ 256,413 
  
$ 176,588



–  
more -



RAYMOND JAMES FINANCIAL, INC. AND SUBSIDIARIES 
CONSOLIDATED STATEMENT OF OPERATIONS 
(UNAUDITED) 
Quarter-to-Date
(in thousands, except per share amounts)
 
Three Months Ended
 
 
 
 
 
 
 
June 30,
  
June 24,
  
%
  
March 31,
  
%
 
2006
  
2005
  
Change
  
2006
  
Change
Revenues:
                  
Securities commissions and fees
424,594 
  
349,364 
  
22% 
  
395,009
  
7%
Investment banking
44,075 
  
30,544 
  
44% 
  
38,856
  
13%
Investment advisory fees
46,371 
  
38,674 
  
20% 
  
43,486
  
7%
Interest
125,860 
  
66,354 
  
90% 
  
106,622
  
18%
Net trading profits
5,671 
  
2,722 
  
108% 
  
8,189
  
(31%)
Financial service fees
38,288 
  
20,507 
  
87% 
  
25,101
  
53%
Other
26,498 
  
18,197 
  
46% 
  
39,555
  
(33%)
                   
TOTAL REVENUES
711,357 
  
526,362 
  
35% 
  
656,818
  
8%
Interest Expense
81,689 
  
32,818 
  
149% 
  
64,016
  
28%
NET REVENUES
629,668 
  
493,544 
  
28% 
  
592,802
  
6%
                   
Non-Interest Expenses
                  
Compensation, commissions and benefits
429,224 
  
348,361 
  
23% 
  
399,645 
  
7% 
Communications and information processing
25,858 
  
23,948 
  
8% 
  
26,698 
  
(3%)
Occupancy and equipment costs
18,701 
  
16,695 
  
12% 
  
18,110 
  
3% 
Clearance and floor brokerage
8,781 
  
6,769 
  
30% 
  
5,060 
  
74% 
Business development
21,782 
  
17,057 
  
28% 
  
19,695 
  
11% 
Other
30,993 
  
29,750 
  
4% 
  
32,330 
  
(4%)
                   
TOTAL NON-INTEREST EXPENSES
535,339 
  
442,580 
  
21% 
  
501,538 
  
7% 
                   
Income before provision for income taxes
94,329 
  
50,964 
  
85% 
  
91,264 
  
3% 
Provision for income taxes
39,728 
  
19,094 
  
108% 
  
33,779 
  
18% 
Minority Interest
(2,173)
  
(512)
  
(324%)
  
(4,046)
  
46% 
Net Income
$56,774 
  
$32,382 
  
75% 
  
$61,531 
  
(8%)
Net Income per share basic
$0.50 
  
$0.29 
  
72% 
  
$0.54 
  
(7%)
Net Income per share diluted
$0.48 
  
$0.29 
  
66% 
  
$0.53 
  
(9%)
Weighted average common shares
                  
outstanding-basic
113,464 
  
110,495 
      
113,194 
    
Weighted average common and common
                  
equivalent shares outstanding-diluted
116,960 
  
113,382 
      
116,412 
    

-more-



RAYMOND JAMES FINANCIAL, INC. AND SUBSIDIARIES 
CONSOLIDATED STATEMENT OF OPERATIONS 
(UNAUDITED) 
Year-to-Date 
(in thousands, except per share amounts)
 
Nine Months Ended
 
June 30,
 
June 24,
  
%
 
2006
  
2005
  
Change
Revenues:
          
Securities commissions and fees
1,186,079 
  
1,048,206
  
13% 
Investment banking
112,645 
  
87,436
  
29% 
Investment advisory fees
132,603 
  
115,233
  
15% 
Interest
320,532 
  
178,161
  
80% 
Net trading profits
19,717 
  
19,919
  
(1%)
Financial service fees
86,441 
  
64,665
  
34% 
Other
85,505 
  
49,446
  
73% 
           
TOTAL REVENUES
1,943,522 
  
1,563,066
  
24% 
Interest Expense
194,516 
  
87,419
  
123% 
NET REVENUES
1,749,006 
  
1,475,647
  
19% 
           
Non-Interest Expenses:
          
Compensation, commissions and benefits
1,195,488 
  
1,039,762
  
15% 
Communications and information processing
77,152 
  
67,205
  
15% 
Occupancy and equipment costs
54,213 
  
48,570
  
12% 
Clearance and floor brokerage
19,607 
  
18,014
  
9% 
Business development
58,608 
  
47,303
  
24% 
Other
87,525 
  
78,205
  
12% 
           
TOTAL NON-INTEREST EXPENSES
1,492,593 
  
1,299,059
  
15% 
           
Income before provision for income taxes
256,413 
  
176,588
  
45% 
Provision for income taxes
99,733 
  
68,088
  
46% 
Minority Interest
(6,734)
  
2,178
  
(409%)
Net Income
$ 163,414 
  
$ 106,322
  
54% 
Net Income per share basic
$1.45 
  
$0.97
  
49% 
Net Income per share diluted
$1.41 
  
$0.94
  
50% 
Weighted average common shares
          
outstanding-basic
112,376 
  
109,980
    
Weighted average common and common
         
equivalent shares outstanding-diluted
115,556 
  
113,240
    


- 30 -

For more information, please contact Tracey Bustamante at 727-567-2824.
Please visit the Raymond James Press Center at raymondjames.com/media.