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SCHWAB REPORTS RECORD ANNUAL RESULTS

 SCHWAB REPORTS RECORD ANNUAL RESULTS
 SAN FRANCISCO, Jan. 15 /PRNewswire/ -- The Charles Schwab


Corporation (NYSE: SCH) reported net income of $49.5 million or $1.27 per share for the year ended Dec. 31, 1991, compared with net income of $16.8 million or $.41 per share for 1990.
 Financial Highlights Three months ended 12 months ended
 (in millions, except Dec. 31 Dec. 31
 per share amounts) 1991 1990 1991 1990
 Total revenues $223.1 $156.7 $795.2 $625.9
 Net revenues 167.3 93.9 569.6 387.4
 Expenses excluding
 interest 138.6 92.2 481.5 358.3
 Income before taxes 28.7 1.7 88.1 29.1
 Net income 16.1 1.0 49.5 16.8
 Net income per share .41 .03 1.27 .41
 Weighted average shares
 outstanding 39.3 39.0 39.1 40.4
 Net revenues for 1991 increased 47 percent over 1990 to a record $569.6 million, primarily due to higher commission and principal trading revenues. Commissions were $348.9 million, up 43 percent over last year, as average daily trading activity increased 40 percent to 18,300 trades per day from 13,100 in 1990. Principal trading revenues increased substantially in 1991 primarily due to the contribution of Mayer & Schweitzer Inc. (M&S), a market maker in over-the-counter securities, which the company acquired in July.
 Expenses excluding interest were $481.5 million for 1991, up 34 percent from 1990. The increase resulted from higher variable compensation reflecting greater profitability and growth in Schwab client assets, increased expenditures to support the company's expansion of its branch office network, product development, technology and marketing programs, and the addition of M&S operating expenses.
 THE CHARLES SCHWAB CORPORATION
 CONSOLIDATED STATEMENT OF INCOME
 (In millions, except per share amounts)
 Three Months 12 Months
 Ended Ended
 Dec. 31, Dec. 31,
 1991 1990 1991 1990
 Revenues
 Commissions $ 94.7 $ 55.4 $348.9 $244.4
 Interest 72.3 81.0 302.2 309.5
 Principal transactions 38.1 1.0 63.4 3.6
 Mutual fund service fees 13.1 12.7 54.2 45.6
 Other 4.9 6.6 26.5 22.8
 Total revenues 223.1 156.7 795.2 625.9
 Interest expense 55.8 62.8 225.6 238.5
 Net revenues 167.3 93.9 569.6 387.4
 Expenses Excluding Interest
 Compensation and benefits 67.9 38.4 234.4 155.1
 Communications 16.5 10.1 57.3 41.6
 Depreciation and amortization 13.3 11.7 51.9 49.1
 Occupancy and equipment 14.2 11.6 51.2 42.9
 Advertising and market
 development 9.1 5.5 25.2 19.9
 Commissions, clearance and
 floor brokerage 7.0 3.1 20.7 12.3
 Professional services 2.7 5.0 12.0 15.9
 Other 7.9 6.8 28.8 21.5
 Total expenses excluding
 interest 138.6 92.2 481.5 358.3
 Income before taxes on income 28.7 1.7 88.1 29.1
 Taxes on income 12.6 .7 38.6 12.3
 Net Income $ 16.1 $ 1.0 $ 49.5 $ 16.8
 As Restated for the Three-For-Two Stock Split:
 Weighted average number of common
 and common equivalent shares 39.3 39.0 39.1 40.4
 Net income per share $ .41 $ .03 $ 1.27 $ .41
 Dividends declared per share $ .040 $ .027 $ .127 $ .087
 Certain 1990 revenues and expenses have been reclassified to conform with the 1991 presentation.
 THE CHARLES SCHWAB CORPORATION
 SELECTED STATISTICAL INFORMATION
 Three Months 12 Months
 Ended Ended
 Dec. 31, Dec. 31,
 1991 1990 1991 1990
 Operating Statistics (i)
 Average daily trading volume 19,500 11,900 18,300 13,100
 Total number of trades
 (in thousands) 1,246 763 4,634 3,315
 Average commission per
 agency trade $76.62 $73.25 $75.88 $74.30
 Number of customer accounts
 that traded (in thousands) 403 272 843 684
 Customer accounts opened
 during the period
 (in thousands) (ii) 98 76 384 300
 As of
 Dec. 31,
 1991 1990
 Financial Condition
 Total assets (in billions) $5.0 $4.1
 Stockholders' equity
 (in millions) $200 $154
 Book value per common share $5.19 $4.21
 Customer Statistics (i)
 Customer equity (in billions) (iii)
 Cash and equivalents:
 -- The Charles Schwab Family
 of Funds $ 8.2 $ 6.9
 -- Schwab One(R) cash balances 3.9 3.4
 -- Other customer cash balances .5 .3
 Net securities:
 -- Schwab 1000 Fund(TM) .2
 -- Schwab U.S. Government Bond
 Fund (Short/Intermediate Term) .1
 -- Mutual Fund Marketplace(R) (iv) 6.1 2.6
 -- Fixed income securities
 (excludes mutual funds) 6.4 4.7
 -- Equity and other securities
 (excludes mutual funds) 23.4 13.6
 -- Margin loans outstanding (1.3) (.8)
 Total customer equity $47.5 $30.7
 (i) Statistics presented are for Charles Schwab & Co. Inc.; operations of other subsidiaries are excluded.
 (ii) Customer accounts opened exclude the accounts acquired from New England Discount Brokerage Inc. in the second quarter of 1990.
 (iii) Customer equity is defined as the net market value of customers' securities plus their cash balances at Schwab less margin loans extended to them by Schwab.
 (iv) Excludes money market funds, Schwab 1000 Fund and Schwab U.S. Government Bond Fund (Short/Intermediate Term). Balances include equity funds of $4.1 billion and fixed income funds of $2.0 billion in 1991 and $1.7 billion and $.9 billion, respectively, in 1990.
 "Schwab achieved record earnings and revenues in 1991, and assets in client accounts grew more than 55 percent to a record $48 billion by year-end," said Chairman Charles R. Schwab. "During the past 12 months, assets transferred to Schwab from other brokerage firms reached a record $3.8 billion, and our active accounts grew 14 percent to a record 1.6 million," Schwab noted.
 "We opened 384,000 new accounts, up 28 percent from last year, and expanded our capacity to serve customers by adding 28 new offices, opening a second telephone service center and further expanding our on-line brokerage services. In July, we completed the national rollout of TeleBroker, an efficient touchtone telephone service which, together with Schwab's other on-line services, handled over 14 million client calls and more than 800,000 trades in 1991."
 Schwab said that in addition to new services, offices and technology, the company "used its strong cash flow during 1991 to increase the quarterly cash dividend twice, repurchase 548,000 shares of its common stock, reduce debt, redeem the remaining contingent payment rights from BankAmerica Corp. and acquire Mayer & Schweitzer Inc.
 "We introduced the Schwab 1000 Fund(TM) in April, which attracted more than $191 million in client assets by year-end 1991. In November, we added the Schwab U.S. Government Bond Fund (Short/Intermediate Term), which reached $65 million by Dec. 31, 1991," he said.
 Fourth quarter 1991 earnings totaled $16.1 million or $.41 per share, on net revenues of $167.3 million, compared with net income of $1.0 million, or $.03 per share, on net revenues of $93.9 million during the same period a year ago. On Dec. 2, 1991, the company completed a 3-for-2 stock split of its common stock effected in the form of a 50 percent stock dividend.
 On Jan. 13, 1992, the company filed a petition in U.S. Tax Court to refute an Internal Revenue Service claim arising from its audit of the two tax periods ended March 31, 1988, and Dec. 31, 1988. The IRS claim primarily involves the deductibility of the amortization and depreciation of customer account information, software and fixed assets acquired in 1987. Schwab said, "We believe the company's position is correct. Based upon advice from our legal counsel and tax accountants, we believe the IRS claim is inconsistent with Federal and Tax Court precedents and will not be upheld. It is well known that cases like these are disputed during audits and often end up in court. We intend to contest this issue vigorously." The IRS tax claim for the two periods totals $28.3 million, excluding interest. The issues being contested extend to the company's tax years ended Dec. 31, 1989, 1990, and 1991. Management is confident that the resolution of these issues will not have a material adverse effect on the financial condition of the company.
 -0- 1/15/92
 /CONTACT: Hugo W. Quackenbush, or Mark C. Thompson of The Charles Schwab Corporation, 415-627-7810/
 (SCH) CO: The Charles Schwab Corporation ST: California IN: FIN SU: ERN


RM -- SF011 -- 0184 01/15/92 16:33 EST
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