Bear Stearns Reports Record Earnings and Net Income in 2003; Strong 4th Quarter Caps Second Consecutive Record Year.Business Editors NEW YORK--(BUSINESS WIRE)--Dec. 17, 2003 The Bear Stearns The Bear Stearns Companies, Inc. (NYSE: BSC) is the parent company of Bear, Stearns & Co. Inc., one of the largest global investment banks and securities trading and brokerage firms in the world. Companies Inc. (NYSE NYSE See: New York Stock Exchange :BSC (Binary Synchronous Communications) See bisync. ) -- Annual Earnings Per Share of $8.52 and Net Income of $1.2 Billion, Rose 32% over 2002 -- 2003 Annual Pre-Tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta Profit Margin Hits 29.6% -- 2003 Annual ROE A fictitious surname used for an unknown or anonymous person or for a hypothetical person in an illustration. A lawsuit is generally named for the persons who are parties to it. Reaches 20.2% -- 4th Quarter Earnings Per Share Increase 61% to $2.19 -- Net Income for the Quarter Rises 51% to $288.3 Million The Bear Stearns Companies Inc. (NYSE:BSC) today reported earnings per share (diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. ) of $2.19 for the fourth quarter ended November November: see month. 30, 2003, up 61.0% from $1.36 per share for the fourth quarter of 2002. Net income for the fourth quarter of 2003 was $288.3 million, up 51.3% from $190.5 million for the fourth quarter of 2002. Net revenues for the 2003 fourth quarter were $1.5 billion, up 35.9% from $1.1 billion for the 2002 fourth quarter. The annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. return on common stockholders' equity Stockholders' Equity The portion of the balance sheet that includes capital received from investors in exchange for stock (paid-in capital), donated capital, and retained earnings. This is equal to total assets minus liabilities, preferred stock and intangible assets. for the fourth quarter of 2003 was 19.6%. For the fiscal year ended November 30, 2003, earnings per share (diluted) were a record $8.52, up 31.7% from $6.47 in the prior year. Net income for the full year was $1.2 billion, up 31.7% from the $878.3 million earned in the twelve-month period ended November 30, 2002. Net revenues for fiscal year 2003 were $6.0 billion, an increase of 16.9% from $5.1 billion in the prior fiscal year. After-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. return on common stockholders' equity was 20.2% for 2003. "Bear Stearns posted its best ever results in 2003. In the face of difficult market conditions our array of businesses once again produced outstanding results," said Bear Stearns chairman and chief executive officer, James James, person in the Bible James, in the Gospel of St. Luke, kinsman of St. Jude. The original does not specify the relationship. James, rivers, United States James. E. Cayne. "Our Fixed Income Division continues to deliver exceptional results with strong performance across our mortgage, credit and interest rate products areas. The efforts to grow and deepen deep·en tr. & intr.v. deep·ened, deep·en·ing, deep·ens To make or become deep or deeper. deepen Verb to make or become deeper or more intense Verb 1. our franchise are evident not only in Fixed Income but also throughout the firm in Institutional Equities, Global Clearing Services, Investment Banking and Wealth Management. The investments we have made in our equity related businesses will continue to produce returns with improving market conditions, and our current quarter results are evidence of this trend. The increase in profit margins and return on common equity reflect both the growth and diversification Diversification A risk management technique that mixes a wide variety of investments within a portfolio. It is designed to minimize the impact of any one security on overall portfolio performance. Notes: Diversification is possibly the greatest way to reduce the risk. of our businesses as well as our continued focus on risk and expense control." A brief discussion of the firm's business segments follows: CAPITAL MARKETS Fourth Quarter Capital Markets net revenues for the fourth quarter of 2003 were $1.2 billion, up 38.8% from $839.6 million for the fourth quarter ended November 30, 2002. -- Institutional Equities net revenues were $266.3 million, down 5.7% from $282.4 million for the fourth quarter of 2002. Lower volume on the NYSE and depressed Depressed A description of a market, security, or product that is experiencing weak demand and lowering prices. Notes: A depressed market, security, or product implies that prices and volume are low. There are many reasons for a depressed market, security, or product. volatility Volatility 1. A statistical measure of the tendency of a market or security to rise or fall sharply within a period of time. 2. A variable in option pricing formulas that denotes the extent to which the return of the underlying asset will fluctuate between now and the levels reduced institutional equities net revenues. Equity derivatives In finance, an equity derivative is a class of financial instruments whose value is at least partly derived from one or more underlying equity securities. Market participants trade equity derivatives in order to transfer or transform certain risks associated with the revenues rose on improved customer activity. -- Fixed Income net revenues were $648.9 million, up 39.9% from $463.9 million in the comparable prior year period. Low interest rates and a steep yield curve continued to create positive market conditions across the Fixed Income businesses, including mortgage-backed securities Mortgage-backed securities (MSBs) Securities backed by a pool of mortgage loans. and credit products. Net revenues increased significantly reflecting these favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. markets and increased customer activity. In addition, record revenues were posted this quarter in interest rate products, particularly in interest rate derivatives An interest rate derivative is a derivative where the underlying asset is the right to pay or receive a (usually notional) amount of money at a given interest rate. The interest rate derivatives market is the largest derivatives market in the world. and foreign exchange. -- Investment Banking net revenues were $250.3 million in the fourth quarter of 2003, up 168.3% from the $93.3 million in the comparable prior year period. The 2003 fourth quarter included a $33.7 million realized gain Realized Gain A gain resulting from selling an asset at a price higher than the original purchase price. Notes: There may be tax consequences for a realized profit. from the sale of a merchant banking investment in Aeropostale Inc. The fourth quarter of 2002 included a $33.9 million unrealized loss Unrealized Loss A loss that results from holding onto an asset rather than cashing it in and officially taking the loss. Notes: Let's say you own a stock that is down 50%, but you haven't sold it to realize the loss yet. This is said to be an unrealized loss. relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc a mark down of this investment. Excluding the investment, Investment Banking net revenues in the quarter were $216.6 million, up 70.3% from $127.2 million in fourth quarter of 2002. Performance in equity underwriting Underwriting 1. The process by which investment bankers raise investment capital from investors on behalf of corporations and governments that are issuing securities (both equity and debt). 2. The process of issuing insurance policies. , high yield underwriting and merchant banking significantly increased revenues when compared with the fourth quarter of 2002. Full Year Net revenues in Capital Markets, which includes Institutional Equities, Fixed Income and Investment Banking, were a record $4.8 billion for the fiscal year ended November 30, 2003, an increase of 22.3% over the prior fiscal year's $3.9 billion. -- Institutional Equities net revenues for fiscal year 2003 were down 16.6% to $932.6 million from $1.12 billion in fiscal 2002. Difficult market conditions had a negative effect on net revenues from domestic institutional equities and convertible and other equity arbitrage equity arbitrage See risk arbitrage. activity. -- The Fixed Income Division reported record results for the third consecutive year, highlighting the strength and breadth Breadth The percentage of assets or stocks advancing relative to those unchanged or declining. Also the number of independent forecasts available per year. A stock picker forecasting returns to 100 stocks every quarter exhibits a breadth of 400, assuming each forecast is of the franchise. Record net revenues were posted in virtually all product areas including corporate bonds, interest rate products, high yield and distressed bonds, government bonds, foreign exchange and mortgage-backed securities. Fixed Income net revenues were $2.9 billion, up 51.0% from the $1.9 billion recorded in 2002. -- Investment Banking net revenues for 2003 were $961.3 million, up 8.8% from $883.7 million in fiscal 2002. Included in net revenues are gains from the company's merchant banking investment in Aeropostale Inc. of $172.6 million in fiscal year 2003 and $226.9 million in fiscal year 2002. Excluding the merchant banking gains from Aeropostale Inc., net revenues for fiscal 2003 were $788.7 million and for fiscal 2002 were $656.8 million. The increase in revenues was primarily due to an extremely strong performance in high yield underwriting. In addition, merger and acquisition and advisory fees grew significantly as compared with fiscal 2002. GLOBAL CLEARING SERVICES Fourth Quarter Fourth quarter 2003 Global Clearing Services net revenues were $220.0 million, up 22.0% from $180.3 million in the fourth quarter of 2002, reflecting increased net interest revenues. Average customer margin debt balances for the quarter ended November 30, 2003 were $42.0 billion, up from $31.7 billion in the prior year quarter. Net interest revenue rose as the level of customer margin debt and customer short balances increased. Full Year Net revenues in Global Clearing Services were $784.1 million, up 0.8% from $778.1 million in fiscal 2002. Average customer margin debt balances for the year were $39.8 billion, versus $34.1 billion for the year ended November 30, 2002. An increase in net interest revenues attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to higher customer margin balances was substantially offset by reduced commission revenues as customer volumes declined. WEALTH MANAGEMENT Fourth Quarter Wealth Management net revenues for the quarter ended November 30, 2003 were $145.0 million, up 16.5% from $124.5 million in the fourth quarter of 2002. -- Private Client Service revenues were $105.1 million in the fourth quarter of 2003, an increase of 21.5% from $86.5 million in the 2002 quarter reflecting improved customer activity. -- Asset Management net revenues grew 5.0% to $39.9 million for the fourth quarter of 2003 from $38.0 million in the prior year's quarter due to increased management fees. Full Year Net revenues in Wealth Management, which includes Private Client Services and Asset Management, were $511.3 million for fiscal 2003, up 2.6% versus $498.4 million in fiscal 2002. -- Revenues from the Private Client Service area rose 5.6% to $378.8 million for the fiscal year from $358.8 million for fiscal 2002. The improvement reflects an increase in customer activity. -- The Asset Management business reported revenues of $132.5 million for the full fiscal year 2003 down 5.1% from $139.6 million in the prior year due to lower performance fees on alternative investment products. -- Assets under management Assets Under Management (AUM) is a term used by financial services companies in the mutual fund and money management or investment management business to gauge how much money they are managing. rose to $27.1 billion as of November 30, 2003 from $24.0 billion as of November 30, 2002. EXPENSES Fourth Quarter -- Compensation as a percentage of net revenues was 48.9% in the fourth quarter of 2003 versus 50.2% for the quarter ended November 30, 2002. -- Non-compensation expenses were $345.6 million for the quarter ended November 30, 2003, up 19.7% from $288.9 million in the 2002 quarter. The increase in non-compensation expenses were principally attributable to higher CAP Plan expenses associated with improved earnings. Non-compensation expenses as a percentage of net revenues declined to 22.6% for the 2003 fourth quarter from 25.6% for the fourth quarter of 2002. Full Year -- For the twelve months ended November 30, 2003, compensation as a percentage of net revenues was 48.1% versus 48.9% for fiscal 2002. Excluding the merchant banking gains from Aeropostale Inc., compensation as a percentage of net revenues was 49.2% for the fiscal year 2003 and 50.9% for the fiscal year 2002. -- Non-compensation expenses for the fiscal year 2003 were $1.34 billion, 2.5% higher than the $1.31 billion reported in 2002. Non-compensation expense as a percentage of net revenues for fiscal 2003 declined to 22.4% from 25.5% in fiscal 2002. As of November 30, 2003, total capital, including stockholders' equity and long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. borrowings, was approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $37.5 billion. Book value as of November 30, 2003 was $48.69 per share, based on 142.4 million shares outstanding. The company repurchased approximately 14.0 million shares of its common stock during the fiscal year pursuant to its share repurchase plan share repurchase plan A corporation's plan for buying back a predetermined number of its own shares in the open market. Institution of a share repurchase plan derives from management's view that the company has limited outside investment opportunities and . Founded in 1923, The Bear Stearns Companies Inc. (NYSE: BSC) is the parent company of Bear, Stearns & Co. Inc., a leading investment banking and securities trading securities trading, financial activity involving transactions of property such as stocks, bonds, commodities, and currency (see securities). Although the trading of stocks and bonds dates back several centuries in many Western nations, the development of the and brokerage BROKERAGE, contracts. The trade or occupation of a broker; the commissions paid to a broker for his services. firm. With approximately $37.5 billion in total capital, Bear Stearns serves governments, corporations, institutions and individuals worldwide. The company's business includes corporate finance and mergers and acquisitions, institutional equities and fixed income sales, trading and research, private client services, derivatives derivatives In finance, contracts whose value is derived from another asset, which can include stocks, bonds, currencies, interest rates, commodities, and related indexes. Purchasers of derivatives are essentially wagering on the future performance of that asset. , foreign exchange and futures sales and trading, asset management and custody The care, possession, and control of a thing or person. The retention, inspection, guarding, maintenance, or security of a thing within the immediate care and control of the person to whom it is committed. The detention of a person by lawful authority or process. services. Through Bear, Stearns Securities Corp., it offers financing, securities lending Securities Lending When a brokerage lends securities owned by its clients to short sellers. Notes: This allows brokers to create additional revenue (commissions) on the short sale transaction. , clearing and technology solutions to hedge funds hedge fund, in finance, a highly speculative, largely unregulated investment device. Originating in the 1950s, the funds "hedge" by offsetting "short" positions (borrowing a security and then selling it at a higher price before repaying the lender) against "long" , broker-dealers and investment advisors Investment Advisor 1. A person making investment recommendations in return for a flat fee or percentage of assets managed, known as a commission. 2. For mutual fund companies, it is the individual who has the day-to-day responsibility of investing and monitoring the cash and . Headquartered in New York City New York City: see New York, city. New York City City (pop., 2000: 8,008,278), southeastern New York, at the mouth of the Hudson River. The largest city in the U.S. , the company has approximately 10,500 employees worldwide. For additional information about Bear Stearns, please visit the firm's Web site at http://www.bearstearns.com. Financial Tables Attached
THE BEAR STEARNS COMPANIES INC.
SEGMENT DATA
(UNAUDITED)
Three Months Ended % Change From
----------------------------------- -----------------
Nov. 30, Nov. 30, Aug. 31, Nov. 30, Aug. 31,
2003 2002 2003 2002 2003
----------- ----------- ----------- -------- --------
(In thousands)
NET REVENUES
Capital Markets
Institutional
Equities $ 266,254 $ 282,411 $ 200,506 (5.7%) 32.8%
Fixed Income 648,948 463,908 720,128 39.9% (9.9%)
Investment
Banking 250,322 93,309 299,742 168.3% (16.5%)
----------- ----------- -----------
Total Capital
Markets 1,165,524 839,628 1,220,376 38.8% (4.5%)
Global Clearing
Services 219,960 180,293 200,929 22.0% 9.5%
Wealth Management 144,966 124,462 126,351 16.5% 14.7%
Other (1) 827 (17,375) (62,596) 104.8% 101.3%
---------- ---------- ----------
Total net
revenues $1,531,277 $1,127,008 $1,485,060 35.9% 3.1%
=========== =========== ===========
PRE-TAX INCOME
Capital Markets $ 433,239 $ 251,460 $ 540,942 72.3% (19.9%)
Global Clearing
Services 87,127 55,590 68,456 56.7% 27.3%
Wealth Management (1,301) 4,357 9,851 (129.9%) (113.2%)
Other (1) (82,302) (38,627) (137,072) (113.1%) 40.0%
----------- ----------- -----------
Total pre-tax
income $ 436,763 $ 272,780 $ 482,177 60.1% (9.4%)
=========== =========== ===========
Twelve Months Ended % Change
------------------------- ----------
Nov. 30, Nov. 30,
2003 2002
------------ ------------
(In thousands)
NET REVENUES
Capital Markets
Institutional Equities $ 932,567 $ 1,117,762 (16.6%)
Fixed Income 2,925,483 1,938,045 51.0%
Investment Banking 961,267 883,717 8.8%
------------ ------------
Total Capital Markets 4,819,317 3,939,524 22.3%
Global Clearing Services 784,072 778,087 0.8%
Wealth Management 511,307 498,411 2.6%
Other (1) (120,205) (87,786) (36.9%)
------------ ------------
Total net revenues $ 5,994,491 $ 5,128,236 16.9%
============ ============
PRE-TAX INCOME
Capital Markets $ 1,924,071 $ 1,343,912 43.2%
Global Clearing Services 245,531 265,327 (7.5%)
Wealth Management 19,217 11,616 65.4%
Other (1) (416,550) (309,892) (34.4%)
------------ ------------
Total pre-tax income $ 1,772,269 $ 1,310,963 35.2%
============ ============
(1) Includes consolidation and elimination entries, unallocated
revenues (predominantly interest) and certain corporate
administrative functions, including certain legal costs and costs
related to the Capital Accumulation Plan for Senior Managing
Directors ("CAP Plan").
THE BEAR STEARNS COMPANIES INC.
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
Three Months Ended
----------------------------------------
Nov. 30, Nov. 30, Aug. 31,
2003 2002 2003
------------- ------------- -------------
(In thousands, except share
and per share data)
REVENUES
Commissions $ 288,441 $ 276,048 $ 279,888
Principal transactions 790,486 614,366 724,023
Investment banking 225,763 81,236 298,716
Interest and dividends 495,514 505,351 503,135
Other income 64,842 43,870 36,509
------------- ------------- -------------
Total revenues 1,865,046 1,520,871 1,842,271
Interest expense 333,769 393,863 357,211
------------- ------------- -------------
Revenues, net of
interest expense 1,531,277 1,127,008 1,485,060
------------- ------------- -------------
NON-INTEREST EXPENSES
Employee compensation and
benefits 748,880 565,370 681,745
Floor brokerage, exchange
and clearance fees 43,498 52,435 44,830
Communications and
technology 88,786 94,029 93,047
Occupancy 34,959 35,612 34,788
Advertising and market
development 29,239 22,633 24,550
Professional fees 39,248 37,454 36,608
Other expenses 109,904 46,695 87,315
------------- ------------- -------------
Total non-interest
expenses 1,094,514 854,228 1,002,883
------------- ------------- -------------
Income before provision
for income taxes 436,763 272,780 482,177
Provision for income
taxes 148,436 82,231 168,762
------------- ------------- -------------
Net income $ 288,327 $ 190,549 $ 313,415
============= ============= =============
Net income applicable to
common shares $ 280,533 $ 182,359 $ 305,621
============= ============= =============
Adjusted net income used
for diluted earnings per
share (1) $ 308,521 $ 195,268 $ 334,180
============= ============= =============
Basic earnings per share $ 2.43 $ 1.48 $ 2.54
============= ============= =============
Diluted earnings per
share $ 2.19 $ 1.36 $ 2.30
============= ============= =============
Weighted average common
shares outstanding:
Basic 124,090,961 130,133,459 128,681,694
============= ============= =============
Diluted 140,876,365 143,798,762 145,599,540
============= ============= =============
Cash dividends declared
per common share $ 0.20 $ 0.17 $ 0.20
============= ============= =============
% Change From
-------------------------
Nov. 30, Aug. 31,
2002 2003
------------ ------------
REVENUES
Commissions 4.5% 3.1%
Principal transactions 28.7% 9.2%
Investment banking 177.9% (24.4%)
Interest and dividends (1.9%) (1.5%)
Other income 47.8% 77.6%
Total revenues 22.6% 1.2%
Interest expense (15.3%) (6.6%)
Revenues, net of interest expense 35.9% 3.1%
NON-INTEREST EXPENSES
Employee compensation and benefits 32.5% 9.8%
Floor brokerage, exchange and clearance
fees (17.0%) (3.0%)
Communications and technology (5.6%) (4.6%)
Occupancy (1.8%) 0.5%
Advertising and market development 29.2% 19.1%
Professional fees 4.8% 7.2%
Other expenses 135.4% 25.9%
Total non-interest expenses 28.1% 9.1%
Income before provision for income taxes 60.1% (9.4%)
Provision for income taxes 80.5% (12.0%)
Net income 51.3% (8.0%)
Net income applicable to common shares 53.8% (8.2%)
Adjusted net income used for diluted
earnings per share (1) 58.0% (7.7%)
Basic earnings per share 64.2% (4.3%)
Diluted earnings per share 61.0% (4.8%)
(1) Represents net income reduced for preferred stock dividends and
increased for costs related to the CAP Plan. For earnings per
share, the costs related to the CAP Plan (net of tax) are added
back as the shares related to the CAP Plan are included in
weighted average common shares outstanding.
THE BEAR STEARNS COMPANIES INC.
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
Twelve Months Ended % Change
--------------------------- ---------
November 30, November 30,
2003 2002
------------- -------------
(In thousands, except
share and per share data)
REVENUES
Commissions $ 1,077,926 $ 1,110,974 (3.0%)
Principal transactions 3,292,888 2,537,799 29.8%
Investment banking 904,612 833,480 8.5%
Interest and dividends 1,955,373 2,232,159 (12.4%)
Other income 164,645 176,404 (6.7%)
------------- -------------
Total revenues 7,395,444 6,890,816 7.3%
Interest expense 1,400,953 1,762,580 (20.5%)
------------- -------------
Revenues, net of interest
expense 5,994,491 5,128,236 16.9%
------------- -------------
NON-INTEREST EXPENSES
Employee compensation and
benefits 2,880,695 2,508,197 14.9%
Floor brokerage, exchange and
clearance fees 180,548 197,266 (8.5%)
Communications and technology 365,317 382,857 (4.6%)
Occupancy 137,778 152,523 (9.7%)
Advertising and market
development 106,506 102,984 3.4%
Professional fees 133,304 132,927 0.3%
Other expenses 418,074 340,519 22.8%
------------- -------------
Total non-interest
expenses 4,222,222 3,817,273 10.6%
------------- -------------
Income before provision for
income taxes 1,772,269 1,310,963 35.2%
Provision for income taxes 615,863 432,618 42.4%
------------- -------------
Net income $ 1,156,406 $ 878,345 31.7%
============= =============
Net income applicable to
common shares $ 1,125,031 $ 842,739 33.5%
============= =============
Adjusted net income used for
diluted earnings per share
(1) $ 1,235,991 $ 946,535 30.6%
============= =============
Basic earnings per share $ 9.44 $ 7.00 34.9%
============= =============
Diluted earnings per share $ 8.52 $ 6.47 31.7%
============= =============
Weighted average common
shares outstanding:
Basic 127,819,514 132,798,359
============= =============
Diluted 145,027,266 146,346,111
============= =============
Cash dividends declared per
common share $ 0.74 $ 0.62
============= =============
(1) Represents net income reduced for preferred stock dividends and
increased for costs related to the CAP Plan and the redemption of
preferred stock. For earnings per share, the costs related to the
CAP Plan (net of tax) are added back as the shares related to the
CAP Plan are included in weighted average common shares
outstanding.
THE BEAR STEARNS COMPANIES INC.
SELECTED FINANCIAL INFORMATION
(UNAUDITED)
Twelve Months Ended
--------------------------
Nov. 30, Nov. 30,
2003 2002
--------------------------
(In thousands, except
common share data and
other data)
Results
-------
Revenues, net of interest expense $ 5,994,491 $ 5,128,236
Net income $ 1,156,406 $ 878,345
Net income applicable to common shares $ 1,125,031 $ 842,739
Adjusted net income used for diluted
earnings per share (1) $ 1,235,991 $ 946,535
Financial Position
------------------
Stockholders' equity, at period end $ 7,470,088 $ 6,382,083
Total stockholders' equity and trust issued
preferred securities, at period end $ 8,032,588 $ 6,944,583
Total capital, at period end $ 37,463,053 $ 30,625,982
Common Share Data
-----------------
Basic earnings per share $ 9.44 $ 7.00
Diluted earnings per share $ 8.52 $ 6.47
Book value per common share, at period end $ 48.69 $ 39.94
Weighted average common shares outstanding:
Basic 127,819,514 132,798,359
Diluted 145,027,266 146,346,111
Common shares outstanding, at period end (2) 142,369,836 145,591,496
Financial Ratios
----------------
Return on average common equity (annualized) 20.2% 18.1%
Adjusted pre-tax profit margin (3) 32.8% 28.6%
Pre-tax profit margin (4) 29.6% 25.6%
After-tax profit margin (5) 19.3% 17.1%
Compensation & benefits / Revenues, net of
interest expense 48.1% 48.9%
Other Data (in billions, except employees)
------------------------------------------
Margin debt balances, at period end $ 43.6 $ 36.7
Margin debt balances, average for period $ 39.8 $ 34.1
Customer short balances, at period end $ 71.6 $ 58.8
Customer short balances, average for period $ 63.6 $ 54.6
Stock borrowed, at period end $ 56.5 $ 46.2
Stock borrowed, average for period $ 52.1 $ 44.1
Free credit balances, at period end $ 22.3 $ 17.1
Free credit balances, average for period $ 20.1 $ 19.3
Assets under management, at period end $ 27.1 $ 24.0
Employees, at period end 10,532 10,574
Three Months Ended
---------------------------------------------------
Nov. 30, Aug. 31, May 31, Feb. 28,
2003 2003 2003 2003
----------------------------------------------------
(In thousands, except common share data
and other data)
Results
-------
Revenues, net of
interest expense $ 1,531,277 $ 1,485,060 $ 1,462,720 $ 1,515,434
Net income $ 288,327 $ 313,415 $ 280,411 $ 274,253
Net income
applicable to
common shares $ 280,533 $ 305,621 $ 272,616 $ 266,261
Adjusted net
income used for
diluted earnings
per share (1) $ 308,521 $ 334,180 $ 299,533 $ 293,756
Financial Position
------------------
Stockholders'
equity, at period
end $ 7,470,088 $ 6,875,668 $ 6,714,397 $ 6,529,628
Total
stockholders'
equity and trust
issued preferred
securities, at
period end $ 8,032,588 $ 7,438,168 $ 7,276,897 $ 7,092,128
Total capital, at
period end $ 37,463,053 $ 34,438,022 $ 33,520,967 $ 31,987,917
Common Share Data
-----------------
Basic earnings per
share $ 2.43 $ 2.54 $ 2.27 $ 2.21
Diluted earnings
per share $ 2.19 $ 2.30 $ 2.05 $ 2.00
Book value per
common share, at
period end $ 48.69 $ 45.46 $ 43.52 $ 41.64
Weighted average
common shares
outstanding:
Basic 124,090,961 128,681,694 128,711,363 129,773,603
Diluted 140,876,365 145,599,540 146,062,838 147,029,224
Common shares
outstanding, at
period end (2) 142,369,836 146,662,752 146,915,258 146,659,224
Financial Ratios
----------------
Return on average
common equity
(annualized) 19.6% 21.3% 19.7% 19.9%
Adjusted pre-tax
profit margin (3) 31.7% 35.8% 32.4% 31.2%
Pre-tax profit
margin (4) 28.5% 32.5% 29.3% 28.1%
After-tax profit
margin (5) 18.8% 21.1% 19.2% 18.1%
Compensation &
benefits /
Revenues, net of
interest expense 48.9% 45.9% 47.3% 50.0%
Other Data (in
billions, except
employees)
-----------------
Margin debt
balances, at
period end $ 43.6 $ 40.9 $ 43.4 $ 37.3
Margin debt
balances, average
for period $ 42.0 $ 42.1 $ 39.0 $ 35.9
Customer short
balances, at
period end $ 71.6 $ 65.7 $ 65.5 $ 55.9
Customer short
balances, average
for period $ 69.3 $ 67.3 $ 61.4 $ 56.3
Stock borrowed, at
period end $ 56.5 $ 53.4 $ 49.8 $ 41.6
Stock borrowed,
average for
period $ 59.1 $ 55.6 $ 48.5 $ 45.0
Free credit
balances, at
period end $ 22.3 $ 19.8 $ 18.6 $ 16.7
Free credit
balances, average
for period $ 22.4 $ 20.8 $ 18.8 $ 18.4
Assets under
management, at
period end $ 27.1 $ 25.7 $ 24.4 $ 23.3
Employees, at
period end 10,532 10,515 10,472 10,506
Three Months Ended
----------------------------------------------------
Nov. 30, Aug. 31, May 31, Feb. 28,
2002 2002 2002 2002
----------------------------------------------------
(In thousands, except common share data
and other data)
Results
-------
Revenues, net of
interest expense $ 1,127,008 $ 1,154,384 $ 1,607,666 $ 1,239,178
Net income $ 190,549 $ 164,418 $ 342,852 $ 180,526
Net income
applicable to
common shares $ 182,359 $ 156,094 $ 333,538 $ 170,748
Adjusted net
income used for
diluted earnings
per share (1) $ 195,268 $ 178,994 $ 381,533 $ 190,739
Financial Position
------------------
Stockholders'
equity, at period
end $ 6,382,083 $ 5,954,431 $ 5,963,258 $ 5,760,905
Total
stockholders'
equity and trust
issued preferred
securities, at
period end $ 6,944,583 $ 6,516,931 $ 6,525,758 $ 6,323,405
Total capital, at
period end $ 30,625,982 $ 29,567,725 $ 31,038,949 $ 31,063,625
Common Share Data
-----------------
Basic earnings per
share $ 1.48 $ 1.32 $ 2.80 $ 1.39
Diluted earnings
per share $ 1.36 $ 1.23 $ 2.59 $ 1.29
Book value per
common share, at
period end $ 39.94 $ 38.10 $ 37.16 $ 34.95
Weighted average
common shares
outstanding:
Basic 130,133,459 132,436,184 133,772,110 134,793,949
Diluted 143,798,762 145,895,494 147,592,256 148,115,050
Common shares
outstanding, at
period end (2) 145,591,496 146,478,611 146,873,990 147,040,102
Financial Ratios
----------------
Return on average
common equity
(annualized) 14.5% 13.3% 29.5% 15.2%
Adjusted pre-tax
profit margin (3) 26.2% 24.0% 36.3% 24.9%
Pre-tax profit
margin (4) 24.2% 21.2% 32.3% 22.1%
After-tax profit
margin (5) 16.9% 14.2% 21.3% 14.6%
Compensation &
benefits /
Revenues, net of
interest expense 50.2% 51.6% 44.4% 51.1%
Other Data (in
billions, except
employees)
-----------------
Margin debt
balances, at
period end $ 36.7 $ 32.5 $ 36.7 $ 34.6
Margin debt
balances, average
for period $ 31.7 $ 33.7 $ 35.9 $ 35.1
Customer short
balances, at
period end $ 58.8 $ 52.6 $ 55.8 $ 54.5
Customer short
balances, average
for period $ 53.5 $ 52.1 $ 56.9 $ 55.9
Stock borrowed, at
period end $ 46.2 $ 40.6 $ 43.3 $ 39.8
Stock borrowed,
average for
period $ 43.4 $ 41.9 $ 45.4 $ 45.6
Free credit
balances, at
period end $ 17.1 $ 18.3 $ 16.6 $ 17.9
Free credit
balances, average
for period $ 19.8 $ 19.4 $ 18.5 $ 19.6
Assets under
management, at
period end $ 24.0 $ 23.2 $ 24.8 $ 25.8
Employees, at
period end 10,574 10,493 10,426 10,341
(1) Represents net income reduced for preferred stock dividends and
increased for costs related to the CAP Plan and the redemption of
preferred stock. For earnings per share, the costs related to the
CAP Plan (net of tax) are added back as the shares related to the
CAP Plan are included in weighted average common shares
outstanding.
(2) Represents shares used to calculate book value per common share.
Common shares outstanding include units issued under certain stock
compensation plans which will be distributed as shares of common
stock.
(3) Represents the ratio of income before both CAP Plan costs and
provision for income taxes to revenues, net of interest expense.
(4) Represents the ratio of income before provision for income taxes
to revenues, net of interest expense.
(5) Represents the ratio of net income to revenues, net of interest
expense.
Certain statements contained in this discussion are "forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. " within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Such forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ materially from those discussed in the forward-looking statements. For a discussion of the risks and uncertainties that may affect the company's future results, please see "Management's Discussion and Analysis Management's discussion and analysis (MD&A) A report from management to shareholders that accompanies the firm's financial statements in the annual report. It explains the period's financial results and enables management to discuss topics that may not be apparent in the financial of Financial Condition and Results of Operations" and "Risk Management" in the company's 2002 Annual Report to Stockholders and similar sections in the company's quarterly reports on Form 10-Q Form 10-Q See 10-Q. which have been filed with the Securities and Exchange Commission. A conference call to discuss the company's results will be held on Wednesday Wednesday: see week. , December December: see month. 17, at 9:00 a.m., E.S.T. The call will be open to the public. Those wishing to listen to the conference call should dial 1-888-806-9467 (or 1-703-871-3627 for international callers) at least 15 minutes prior to the commencement of the call to ensure connection. The conference call will also be accessible through our Web site at http://www.bearstearns.com. For those unable to listen to the live broadcast of the call, a replay will be available on our Web site or by dialing 1-888-836-6074 (or 1-703-925-2505 for international callers) at approximately 1:00 p.m. E.S.T. The pass code for the replay is 344758. The replay will be available until midnight on Friday Friday: see Sabbath; week. Friday young Indian rescued by Crusoe and kept as servant and companion. [Br. Lit.: Robinson Crusoe] See : Servant , December 26. If you have any questions on how to obtain access to the conference call, please contact Kerri Kelly Kel·ly , Ellsworth Born 1923. American abstract painter and sculptor whose works are characterized by flat color areas with sharply defined edges. Kelly, Emmett 1898-1979. at 1-212-272-2529 or via email at kkelly@bear.com. |
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