Van der Moolen Announces Definitive 2003 Results.Business Editors AMSTERDAM Amsterdam, city, Netherlands Amsterdam (ăm`stərdăm', Dutch ämstərdäm`), city (1994 pop. 724,096), constitutional capital and largest city of the Kingdom of the Netherlands, North Holland prov. , Netherlands--(BUSINESS WIRE)--March 4, 2004 Van der Moolen Van der Moolen is a Dutch equity trading firm, with its headquarters located in Amsterdam. They are mainly active in the United States and in Europe, particularly in the Netherlands, France, Germany, Switzerland and the United Kingdom. : -- Net loss EUR EUR In currencies, this is the abbreviation for the Euro. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. 15.9 million -- Impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. of intangible assets Intangible Asset An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. EUR 19.9 million net -- Exceptional provision for NYSE/SEC settlement EUR 21.8 million net -- Dividend on common shares foregone fore·gone v. Past participle of forego1. adj. Having gone before; previous. Usage Note: The word foregone has recently developed a new meaning as a truncation of the phrase Van der Moolen, specialist, market maker and proprietary trader In a financial institution, a proprietary trader ( also known as a securities trader ) is a trader who trades securities on the account of the institution he/she works for, not for client-based business. on several important U.S. and European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. equity, option and fixed income exchanges, announced that it earned net income from ordinary activities, before impairment charges on intangible assets and an exceptional provision to cover settlement with the NYSE/SEC, of EUR 25.8 million in 2003. This was a decline of 62% compared with 2002. The impairment charges consist of a write down of intangible fixed assets fixed assets npl → activo sg fijo fixed assets npl → immobilisations fpl fixed assets fix npl → of EUR 19.9 million after tax. Further, our net income for 2003 was reduced by an exceptional charge of EUR 43.5 million gross, which funds a provision to cover our expected settlement liabilities arising from the investigation of trading violations on the NYSE NYSE See: New York Stock Exchange over the period 1999 to 2003. The effect of this latter charge was to reduce net income by EUR 21.8 million after tax and minority interests. Van der Moolen was able to close 255 (or 99%) of its 258 trading days In Business, the trading day is the time span that a particular stock exchange is open. For example, the New York Stock Exchange is, as of 2006, open from 09:30AM to 4:00PM. Trading days never take place on weekends. in 2003 with a positive trading result. It is proposed that no dividend be paid on common shares for 2003. On the proposal of the Executive Board, the Supervisory Board Supervisory board The board of directors that represents stakeholders in the governance of the corporation. recommends payment of a EUR 2.9 million dividend on 2003 to holders of financing preferred shares Preferred shares Preferred shares give investors a fixed dividend from the company's earnings and entitle them to be paid before common shareholders. See: Preferred stock. , to be drawn from Other Reserves.
Key Figures
---------------------------- ---------------------- ------------------
Euros millions 4th quarter 4th quarter 3rd quarter 12 months
2003 2002 1) 2003 1) 2003 2002 1)
---------------------------- ---------------------- ------------------
Revenues 35.5 77.4 -54% 43.3 -18% 174.7 327.6 -47%
---------------------------- ---------------------- ------------------
Operating
income (78.6) 12.5 -729% 12.7 -719% (38.3)120.1 -132%
---------------------------- ---------------------- -----------------
Net income from
ordinary activities
before impairment
charges and before
exceptional expense
relating to
provision
NYSE/SEC 5.5 16.8 -67% 5.5 0% 25.8 68.6 -62%
---------------------------- ---------------------- ------------------
Impairment charges
after tax (19.9) (10.1) 97% - (19.9)(10.1) 97%
---------------------------- ---------------------- ------------------
Exceptional expense
relating to
provision NYSE/SEC
after tax (21.8) - - (21.8) -
---------------------------- ---------------------- ------------------
Net income from
ordinary
activities (36.2) 6.7 -640% 5.5 -758% (15.9) 58.5 -127%
---------------------------- ---------------------- ------------------
Guarantee
capital 386.2 573.6 -33%488.7 -21% 386.2 573.6 -33%
---------------------------- ---------------------- ------------------
Per common share data
(Euros x 1)
---------------------------- ---------------------- ------------------
Net income from
ordinary activities
before impairment
charges and before
exceptional expense
relating to
provision
NYSE/SEC 0.21 0.42 -51% 0.13 61% 0.68 1.71 -60%
---------------------------- ---------------------- ------------------
Net income from
ordinary
activities (0.91) 0.15 -690% 0.13 -811% (0.42) 1.45 -129%
---------------------------- ---------------------- ------------------
Cash earnings 0.57 0.48 19% 0.20 184% 1.30 2.07 -37%
---------------------------- ---------------------- ------------------
1) adjusted for purposes of comparison
Fred (Friendly Rollabout Engineered for Doctors) A mobile medical conferencing unit. See videoconferencing. 1. FRED - Robert Carr. Language used by Framework, Ashton-Tate. 2. . Bottcher, CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of Van der Moolen, commented, "We have posted modest net results before exceptional items for 2003. This was achieved under difficult market conditions, while the on-going Adj. 1. on-going - currently happening; "an ongoing economic crisis" ongoing current - occurring in or belonging to the present time; "current events"; "the current topic"; "current negotiations"; "current psychoanalytic theories"; "the ship's current position" NYSE investigation has absorbed Absorbed 1. In a general business sense, when a cost is treated as an expense instead of being passed on to the customer in the form of higher prices. 2. In underwriting, when an issue has been completely sold to the public. 3. a great deal of both management's and our staff's time and attention. Although the net result was clearly unsatisfactory, and was very negatively influenced by exceptional charges we made at year-end year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. , we believe that we will be able to post more acceptable results in 2004. The cost savings and reorganization The process of carrying out, through agreements and legal proceedings, a business plan for winding up the affairs of, or foreclosing a mortgage upon, the property of a corporation that has become insolvent. measures we took over the course of 2003 give Van der Moolen a sound foundation for realizing this goal." Results for the Fourth Quarter of 2003 Net income in the fourth quarter of 2003, before impairment of intangibles Property that is a "right" such as a patent, Copyright, or trademark, or one that is lacking physical existence, such as good will. and exceptional charges to fund the provision for the NYSE/SEC settlement, was EUR 5.5 million, a 67% decrease from the same period in 2002. The impairment charge of EUR 19.9 million after tax and minority interests, consists of EUR 9.8 million related to the closure of our option activities on the American American, river, 30 mi (48 km) long, rising in N central Calif. in the Sierra Nevada and flowing SW into the Sacramento River at Sacramento. The discovery of gold at Sutter's Mill (see Sutter, John Augustus) along the river in 1848 led to the California gold rush of and Philadelphia stock exchanges Philadelphia Stock Exchange (PHLX) A securities exchange trading American and European foreign currency options on spot exchange rates. , which was announced on December December: see month. 17, 2003. A further EUR 10.1 million relates to a write down of the capitalized value capitalized value n. anticipated earnings which are discounted (given a lower value) so that they represent a more realistic current value since projected earnings do not always turn out as favorably as expected or hoped. of VDM See Virtual DOS Machine and CGM. 1. VDM - Vienna Definition Method 2. VDM - Virtual Device Metafile. Specialists' NYSE specialist assignments. The additional exceptional charge to fund a provision for the NYSE/SEC settlement came to EUR 21.8 million after tax and minority interest. At the net level, the fourth quarter saw a loss of EUR 36.2 million. Earnings from ordinary activities (i.e., before impairment and provisioning) of EUR 5.5 million in the fourth quarter exceeds the amount given as a preliminary net income figure on February February: see month. 17, 2004 by EUR 1.6 million. The difference results from the effect on net income after taxes and minority interest of a downward adjustment of bonus accruals Accruals Accounts on a balance sheet that represent liabilities and non-cash-based assets used in accrual-based accounting. These accounts include, among many others, accounts payable, accounts receivable, goodwill, future tax liability and future interest expense. . Income from ordinary activities (before impairment charges and exceptional provisioning for the NYSE/SEC settlement) per common share declined 51% compared with the fourth quarter of 2002, from EUR 0.42 to EUR 0.21. Van der Moolen closed 64 (or 98%) of the 65 trading days during the quarter with a positive trading result. Results for the full year 2003 Revenues came to EUR 174.7 million in 2003, a decrease of 47% compared with the EUR 327.6 million achieved in 2002. The decrease was the result of the combined effects of a 39% organic decline in revenue generation and an 8% negative translation effect due to currency movements. Total 2003 revenues earned in the U.S. declined by 47% relative to 2002, primarily as a result of a lower contribution from VDM Specialists, partially compensated compensated /com·pen·sat·ed/ (kom´pen-sa?tid) counterbalanced; offset. by better results from our U.S. option activities. In 2003, 81% of our revenues were earned in the U.S., compared with 82% in 2002. VDM Specialists' revenues declined by 50% in 2003 compared with 2002, primarily as a result of a 42% decrease in organic revenues and negative translation effects from dollars to euros (-9%). The timing of the acquisition of Lyden Lyd´en n. 1. See Leden. , Dolan Dolan is a surname, and the following people:
Our U.S. option activities achieved revenues of EUR 4.1 million in 2003, compared with a negative EUR 2.0 million in 2002. Revenues from European equity trading In finance, equity trading is the buying and selling of company stock shares. Shares in large publicly-traded companies are bought and sold through one of the major stock exchanges, such as the New York Stock Exchange, London Stock Exchange or Tokyo Stock Exchange, which serve as declined by 48%, with pressure on revenues at each of our operations in Amsterdam, Cologne Cologne (kəlōn`), Ger. Köln, city (1994 pop. 962,500), North Rhine–Westphalia, W Germany, on the Rhine River. It is a commercial, financial, and industrial center, a rail and road junction, and a river port. and London London, city, Canada London, city (1991 pop. 303,165), SE Ont., Canada, on the Thames River. The site was chosen in 1792 by Governor Simcoe to be the capital of Upper Canada, but York was made capital instead. London was settled in 1826. . Extremely low levels of 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 on the exchanges where these units are active contributed to this performance. Transaction costs Transaction Costs Costs incurred when buying or selling securities. These include brokers' commissions and spreads (the difference between the price the dealer paid for a security and the price they can sell it). fell by 31%, from EUR 42.8 million in 2002 to EUR 29.4 million in 2003, but as a percentage of revenues they rose from 13% to 17%. The increase relative to revenues was largely due to the lower revenue productivity of the trades we executed executed 1) adj. to have been completed. (Example: "it is an executed contract") 2) v. to have completed or fully performed. (Example: "he executed all the promises made in the contract") 3) v. , but was also influenced by increases in transaction, clearing and membership costs on exchanges where we are active. Total operating charges, including ordinary amortization of intangibles, impairment of intangibles and the exceptional charge to fund the provision for the NYSE/SEC settlement, rose 11% from 164.7 million in 2002 to 183.6 million in 2003. Excluding amortization, impairment and provisioning, operating costs operating costs npl → gastos mpl operacionales declined by 35% to EUR 87.4 million (EUR 134.1 million in 2002). Contributing to this decrease were dollar weakness (EUR 12.6 million), reduction in bonus accruals (EUR 29.3 million) and cost reductions (EUR 9.1 million), partially offset by increases in one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. advisory, reorganization and closure costs. Bonus accruals declined by EUR 29.3 million (86%) compared with 2002. As a percentage of total revenues this represented a decrease from 10% in 2002 to 3% in 2003. Operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. for 2003 (before amortization of intangibles, the impairment of intangibles and exceptional provisioning for the NYSE/SEC settlement) came to EUR 57.9 million, 62% less than the EUR 150.7 million earned in 2002. Our operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: before amortization of intangibles, the impairment of intangibles and exceptional provisioning for the NYSE/SEC settlement was 33% in 2003, compared with 46% in 2002. This was primarily the result of the decline in organic revenues on a comparatively stable relative transaction cost base, which could only partially be compensated by decreases in other variable costs and fixed cost items as a result of reorganization and other cost saving measures. Amortization of intangible assets was EUR 5.8 million, EUR 3.3 million less than the EUR 9.1 million charge in 2002. The impairment of intangible fixed assets charged to 2003 earnings was EUR 46.9 million gross, compared with a similar charge of EUR 21.5 million gross charged in 2002. On February 17, 2004, VDM Specialists USA LLC (Logical Link Control) See "LANs" under data link protocol. LLC - Logical Link Control reached an agreement in principle with the staff of the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. Securities and Exchange Commission and with the Enforcement Division of the New York Stock Exchange New York Stock Exchange (NYSE) World's largest marketplace for securities. The exchange began as an informal meeting of 24 men in 1792 on what is now Wall Street in New York City. over a settlement related to the investigation of trading violations by NYSE specialists from 1999 to 2003. In this connection, VDM Specialists USA LLC has submitted a proposal for settlement to the SEC in the range of $51.8 million to $57.7 million. On March 2, 2004, VDM Specialists submitted a new range for settlement, of between $55 million and $57.7 million. A definitive agreement awaits the decision of the Commissioners of the SEC. We have taken a provision of EUR 43.5 million for this settlement, equivalent to $55.0 million. Of this, EUR 27.6 million has the character of restitution In the context of Criminal Law, state programs under which an offender is required, as a condition of his or her sentence, to repay money or donate services to the victim or society; with respect to maritime law, the restoration of articles lost by jettison, done when the , and EUR 15.9 million is fines and penalties. Net interest income in 2003 was a EUR 10.6 million charge, compared with a EUR 14.1 million charge in 2002. The effective tax rate on our income from ordinary activities (before the impairment of intangibles and exceptional provisioning for the NYSE/SEC settlement) declined from 29% in 2002 to 16% in 2003. This relatively low tax burden results from the fiscal deductibility of goodwill write downs in the U.S., and from the tax-reducing effect of our Concern Financing Company, which allows us to create a tax-efficient financing structure for the Group. The effect of these influences was reinforced re·in·force also re-en·force or re·en·force tr.v. re·in·forced, re·in·forc·ing, re·in·forc·es 1. To give more force or effectiveness to; strengthen: The news reinforced her hopes. by the relatively low level of operating results. Including the impairment of intangible assets and the exceptional provisioning charge related to the NYSE/SEC settlement, the tax burden on 2003 earnings was 59%. Minority interest in our earnings, relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the portion of our earnings from ordinary activities attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to the partners in our American subsidiaries, was a credit of EUR 8.3 million compared to a charge of EUR 27.8 million in 2002. The credit posted in 2003 is explained by the portion of the impairment of intangible assets and the exceptional provision for settlement with the NYSE/SEC that is attributable to our partners. Net income from ordinary activities (before the impairment of intangibles and exceptional provisioning for the NYSE/SEC settlement, but after minority interest) fell 62% from EUR 68.6 million in 2002 to EUR 25.8 million in 2003. The net result for 2003 was a loss of EUR 15.9 million compared to a profit of EUR 58.5 million in 2002. The net loss per common share was EUR 0.42 in 2003, calculated on the basis of the average number of common shares outstanding. This compares to a profit of EUR 1.45 in 2002. Excluding the impairment of intangible fixed assets and the exceptional provision for settlement with the NYSE/SEC, earnings per common share were EUR 0.68 in 2003, compared with EUR 1.71 in 2002, a decline of 60%. Cash earnings per common share were EUR 1.30 in 2003, 37% less than the EUR 2.07 earned in 2002. Discontinued dis·con·tin·ue v. dis·con·tin·ued, dis·con·tin·u·ing, dis·con·tin·ues v.tr. 1. To stop doing or providing (something); end or abandon: activities Our net income for 2003 included the results of activities that were discontinued during 2003 or will be disposed dis·pose v. dis·posed, dis·pos·ing, dis·pos·es v.tr. 1. To place or set in a particular order; arrange. 2. of in the first quarter of 2004. The net losses of these activities amounted to EUR 10.7 million in 2003, excluding amortization of intangible fixed assets and the portion of the impairment charge related to them. Included in this amount is a EUR 6.6 million net loss from our U.K. fixed income trading unit Trading unit The number of shares of a particular security that is used as the acceptable quantity for trading on the exchanges. trading unit See unit of trading. . On the basis of the agreement in principle to sell this latter activity, which was signed on January January: see month. 7, 2004, and the closure of the other operations, this net loss has a non-recurring character. Cash flow and investment Cash flow from operational activities declined by EUR 210.8 million in 2003 to EUR 20.2 million, primarily as a result of increased working capital. Cash from investment activities was a positive EUR 1.8 million, compared with a negative EUR 63.6 million in 2002. The outflow in 2002 was in connection with the acquisition of Lyden, Dolan, Nick. Cash flow from financing activities Cash Flow from Financing Activities A category in the cash flow statement that accounts for external activities such as issuing cash dividends, adding or changing loans, or issuing and selling more stock. in 2003 was a negative EUR 19.6 million in 2003. This outflow was largely the result of share repurchases Share Repurchase A program by which a company buys back its own shares from the marketplace, reducing the number of outstanding shares. This is usually an indication that the company's management thinks the shares are undervalued. during the year and payment of a cash dividend on 2002 earnings, and was only slightly offset by increased recourse The right of an individual who is holding a Commercial Paper, such as a check or promissory note, to receive payment on it from anyone who has signed it if the individual who originally made it is unable, or refuses, to tender payment. to external financing In the theory of capital structure, External financing is the phrase used to describe funds that firms obtain from outside of the firm. It is contrasted to internal financing which consists mainly of profits retained by the firm for investment. . Balance sheet Our balance sheet total declined from EUR 1,494.7 million at the end of 2002 to EUR 884.4 million on December 31, 2003. The decrease is largely the result of closure of option activities in the U.S. and Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). and the associated reduction in their contribution to assets and
liabilities, the impairment of intangible fixed assets and the
depreciation of the dollar relative to the euro.Shareholders' equity Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares. declined from EUR 312.2 million to EUR 201.5 million. This decline is largely explained by the net loss booked for the year, repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. of shares, payment of a cash dividend on 2002 earnings, the EUR 2.9 million dividend to holders of financing preferred shares to be drawn from Other Reserves and the reconciliation of negative currency effects on equity interests and inter-company loans to entities outside the euro-zone. Our accounts are drawn up before allocation The apportionment or designation of an item for a specific purpose or to a particular place. In the law of trusts, the allocation of cash dividends earned by a stock that makes up the principal of a trust for a beneficiary usually means that the dividends will be treated as of income, in conformity with international standards. Solvency The ability of an individual to pay his or her debts as they mature in the normal and ordinary course of business, or the financial condition of owning property of sufficient value to discharge all of one's debts. solvency n. , defined as Group equity divided by the balance sheet total, rose from 25% at the end of 2002 to 27% on December 31, 2003. If the portion of our reported assets and liabilities that relate to the U.K. fixed income operation had been disposed of as of that date, our solvency ratio Solvency Ratio One of many ratios used to gauge a company's ability to meet long-term obligations. Notes: Derived by taking a company's net worth and dividing by total assets. See also: Asset, Asset Valuation, Balance Sheet, Fundamental Analysis, Income Statement would be 36%. Guarantee capital, which consists of Group equity plus the non-current portion of our subordinated Subordinated A claim ranked lower in priority than other claims. Common stock claims are always subordinated to debt. indebtedness INDEBTEDNESS. The state, of being in debt, without regard to the ability or inability of the party to pay the same. See 1 Story, Eq. 343; 2 Hill. Ab. 421. 2. , declined from EUR 573.6 million to EUR 386.2 million during 2003. Of this decrease, EUR 110.7 million resulted from the decrease in Shareholders' equity, EUR 29.0 million from the reduced value of minority interests and EUR 47.7 million from reduced subordinated indebtedness. The depreciation of the U.S. dollar relative to the euro played a substantial role in causing these decreases. As a percent of the balance sheet total, guarantee capital rose from 38% at the end of 2002 to 44% at the end of 2003. If the portion of our reported assets and liabilities that relate to the U.K. fixed income operation had been disposed of as of December 31, 2003, our guarantee capital would have equaled 59% of our balance sheet total. The decrease in subordinated indebtedness resulted from repayment Repayment The act of paying back a debt. Notes: Everyone has to repay their debts eventually. See also: Debt, Defeasance, Loan on debt outstanding, a reduction in the number and carried value of exchange seats contributed by our partners and negative currency effects. Dividend proposal At the Annual General Meeting of Shareholders on April 14, 2004, it will be proposed that no dividend on 2003 earnings be paid to holders of common shares of Van der Moolen Holding NV. The cash payment on 2002 earnings was EUR 0.72. On the proposal of the Executive Board, the Supervisory Board recommends payment of a EUR 2.9 million dividend on 2003 to holders of financing preferred shares, to be drawn from Other Reserves. For more information about Van der Moolen, please visit www.vandermoolen.com. Van der Moolen trades on the leading US and European equity, option and fixed income exchanges. The group trades in open outcry Open Outcry A method of trading on a commodity exchange by making verbal bids and offers in the trading pits. Notes: A contract is made if one trader cries out that he wants to sell at a certain price and then another trader yells out that he will buy at that same price. and electronic markets in several time zones. On the NYSE, Van der Moolen currently has a market share of more than 10% of transaction volume for which it acts as specialist. Van der Moolen's traders Traders Individuals who take positions in securities and their derivatives with the objective of making profits. Traders can make markets by trading the flow. When they do this, their objective is to earn the bid/ask spread. worldwide execute To run a program, which causes the computer to carry out its instructions. See executable code, instruction and EXE file. execute - execution an average of 75,000 trades a day. Turnover and price volatility are the most important factors influencing its results. Van der Moolen's shares are listed on Euronext  Euronext N.V. is a pan-European stock exchange based in Paris[1] Amsterdam
(VDMN.AS). American Depositary Receipts American Depositary Receipt (ADR)Certificates issued by a US depository bank, representing foreign shares held by the bank, usually by a branch or correspondent in the country of issue. (ADRs) representing Van der Moolen shares are listed on the NYSE (VDM). Disclaimer (networking) disclaimer - Statement ritually appended to many Usenet postings (sometimes automatically, by the posting software) reiterating the fact (which should be obvious, but is easily forgotten) that the article reflects its author's opinions and not necessarily those of the : Certain statements contained in this press release constitute "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. ". These statements, which contain the words "anticipate", "believe", "intend", "estimate", "expect", "hope", and words of similar meaning, reflect management's beliefs and expectations and are subject to risks and uncertainties that may cause actual results to differ materially. As a result, readers are cautioned not to place undue reliance on such forward-looking statements, and are referred to the documents filed by the Company with the US Securities and Exchange Commission, specifically the Company's most recent filing on Form 20-F, which identify important risk factors that could cause actual results to differ, including the outcome of the NYSE inquiry and related civil litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. in U.S. courts against Van der Moolen Holding, Van der Moolen Specialists USA, and the members of the Management Board of the Holding. The Company disclaims any obligation to update its view of such risks and uncertainties or to publicly announce the result of any revisions ReVisions is a 2004 anthology of alternate history short-stories. It is edited by Julie E. Czerneda and Isaac Szpindel. Contents Title Author The Resonance of Light James Alan Gardner Out of China Julie E. to the forward-looking statements made herein, except where it would be required to do so under applicable law.
Van der Moolen Holding N.V.
Consolidated Profit and Loss Account
(Dutch GAAP, Unaudited)
----------------------------------------------------------------------
(amounts in millions of
Euros, except per share data) Q4 Q4 % Q3 %
2003 2002 1) 2003 1)
----------------------------------------------------------------------
Revenues 35.5 77.4 -54% 43.3 -18%
Transaction costs 7.0 10.5 -33% 7.5 -7%
Net revenues 28.5 66.9 -57% 35.8 -20%
Fixed personnel expenses 10.1 11.9 10.3
Bonus accruals (4.8) 6.7 2.9
Seat leases 3.1 4.3 3.5
Information and
communication expenses 1.2 1.8 1.4
Depreciation 1.3 0.8 0.6
Amortization of
intangible fixed assets 1.3 2.8 1.5
Impairment fixed assets 46.9 21.5 -
Exceptional expense
relating to provision
NYSE/SEC 43.5 - -
General and
administrative expenses 4.5 4.6 2.9
Total operating expenses 107.1 54.4 97% 23.1 364%
Operating income (78.6) 12.5 -729% 12.7 -719%
Net interest income
(expense) (2.3) (2.8) (2.7)
Gain on disposal of
financial fixed assets - - -
Income from ordinary
activities before tax (80.9) 9.7 -934% 10.0 -909%
Taxation (27.0) (2.3) 1.4
Group income after
taxation (53.9) 12.0 -549% 8.6 -727%
Minority interest (17.7) 5.3 3.1
Net income (36.2) 6.7 -640% 5.5 -758%
----------------------------------------------------------------------
----------------------------------------------------------------------
Net income from ordinary
activities before
impairment charges and
before exceptional
expense relating to
provision NYSE/SEC 5.5 16.8 -67% 5.5 0%
Impairment charges after
tax (19.9) (10.1) -
Exceptional expense
relating to provision
NYSE/SEC after tax (21.8) - -
Net income from ordinary
activities (36.2) 6.7 -640% 5.5 -758%
Dividends on financing
preferred shares (2.2) 0.8 0.7
Net income from ordinary
activities attributable
to holders of common
shares (34.0) 16.0 -313% 4.8 -808%
Cash earnings
attributable to holders
of common shares 21.5 18.5 16% 7.6 183%
Average number of common
shares outstanding 37,539,057 38,410,863 -2% 37,685,279 0%
Diluted average number
of common shares
outstanding 37,539,057 38,475,369 -2% 37,685,279 0%
Per share data:
Net income from ordinary
activities before
impairment charges and
before exceptional
expense relating to
provision NYSE/SEC per
common share 0.21 0.42 -51% 0.13 61%
Diluted net income from
ordinary activities
before impairment
charges and before
exceptional expense
relating to provision
NYSE/SEC per common
share 0.21 0.42 -51% 0.13 61%
Net income from ordinary
activities per common
share (0.91) 0.15 -690% 0.13 -811%
Diluted net income from
ordinary activities per
common share (0.91) 0.15 -691% 0.13 -811%
Cash earnings per share
(Cash EPS) 0.57 0.48 19% 0.20 184%
Diluted Cash EPS 0.57 0.48 19% 0.20 184%
----------------------------------------------------------------------
----------------------------------------------------------------------
Van der Moolen Holding N.V.
Q4 Q4 % Q3 %
Revenue breakdown in
millions of Euros 2003 2002 1) 2003 1)
----------------------------------------------------------------------
VDM Specialists 27.3 59.9 33.1
Net gain on principal
transactions 19.2 49.1 -61% 24.5 -22%
Commissions 6.3 7.8 -19% 6.8 -7%
Other 1.8 3.0 -40% 1.8 0%
US Option Business 0.4 3.3 88% 1.5 -73%
European Trading 5.3 11.8 -55% 7.1 -25%
Unallocated and Holding 2.5 2.4 4% 1.6 56%
----------------------------------------------------------------------
Total revenues 35.5 77.4 -54% 43.3 -18%
----------------------------------------------------------------------
----------------------------------------------------------------------
Van der Moolen Holding N.V.
Operating income before
amortization of intangible
fixed assets, before
impairment and before
exceptional expense
relating to provision
NYSE/SEC , breakdown in Q4 Q4 % Q3 %
millions of Euros 2003 2002 1) 2003 1)
----------------------------------------------------------------------
VDM Specialists 16.1 34.2 -53% 16.6 -3%
US Option Business (2.6) - (0.6)-333%
European Trading (3.0) 1.2 -350% (0.8) 275%
Unallocated and Holding 2.6 1.4 -86% (1.0)
----------------------------------------------------------------------
Total operating income
before amortization of
intangible fixed
assets, before
impairment and before
exceptional expense
relating to provision
NYSE/SEC 13.1 36.8 -64% 14.2 -8%
----------------------------------------------------------------------
----------------------------------------------------------------------
VDM Specialists (VDMS) Q4 Q4 Q3
Key figures (Dutch GAAP) 2003 2002 1) 2003 1)
----------------------------------------------------------------------
VDM Specialists
revenues ($ million) 32.4 59.7 37.2
Net gain on principal
transactions 22.9 49.0 27.4
Commissions 7.4 7.8 7.8
Other 2.1 2.9 2.0
Total valueof trading
on NYSE ($ billion) 2,546 2,410 2,476
Value of trading in
VDMS assignments
($ billion) 294 255 277
VDMS market share in
dollar value NYSE 11.6% 10.6% 11.2%
VDMS value of
principal shares
traded ($ billion) 76 88 77
Participation rate 26.0% 34.4% 27.7%
VDMS net gain on
principal transactions
($ million) 22.9 49.0 27.4
Realization rate (basis
points) 3.0 5.6 3.6
----------------------------------------------------------------------
Source: NYSE, Van der Moolen
1) adjusted for purposes of comparison
Van der Moolen Holding N.V.
Consolidated Profit and Loss Account
(Dutch GAAP, Unaudited)
----------------------------------------------------------------------
(amounts in millions of Euros, 12 12
except per share data) months months %
2003 2002 1)
----------------------------------------------------------------------
Revenues 174.7 327.6 -47%
Transaction costs 29.4 42.8 -31%
Net revenues 145.3 284.8 -49%
Fixed personnel expenses 43.7 51.0
Bonus accruals 4.6 33.9
Seat leases 14.7 18.3
Information and communication
expenses 5.3 6.6
Depreciation 3.3 2.8
Amortization of intangible
fixed assets 5.8 9.1
Impairment fixed assets 46.9 21.5
Exceptional expense relating
to provision NYSE/SEC 43.5 -
General and administrative
expenses 15.8 21.5
Total operating expenses 183.6 164.7 11%
Operating income (38.3) 120.1 -132%
Net interest income (expense) (10.6) (14.1)
Gain on disposal of financial
fixed assets 1.9 -
Income from ordinary
activities before tax (47.0) 106.0 -144%
Taxation (22.8) 19.7
Group income after taxation (24.2) 86.3 -128%
Minority interest (8.3) 27.8
Net income (15.9) 58.5 -127%
----------------------------------------------------------------------
Net income from ordinary
activities before impairment
charges and before
exceptional expense
relating to provision
NYSE/SEC 25.8 68.6 -62%
Impairment charges after tax (19.9) (10.1)
Exceptional expense relating
to provision NYSE/SEC after
tax (21.8) -
Net income from ordinary
activities (15.9) 58.5 -127%
Dividends on financing
preferred shares - 2.9
Net income from ordinary
activities attributable to
holders of common shares (15.9) 55.6 -129%
Cash earnings attributable to
holders of common shares 49.2 79.4 -38%
Average number of common
shares outstanding 37,797,329 38,388,043 -2%
Diluted average number of
common shares outstanding 37,797,329 38,525,890 -2%
Per share data:
Net income from ordinary
activities before impairment
charges and before
exceptional expense relating
to provision NYSE/SEC per
common share 0.68 1.71 -60%
Diluted net income from
ordinary activities before
impairment charges and before
exceptional expense relating
to provision NYSE/SEC per
common share 0.68 1.70 -60%
Net income from ordinary
activities per common share (0.42) 1.45 -129%
Diluted net income from
ordinary activities per
common share (0.42) 1.44 -129%
Cash earnings per share (Cash
EPS) 1.30 2.07 -37%
Diluted Cash EPS 1.30 2.06 -37%
----------------------------------------------------------------------
----------------------------------------------------------------------
Van der Moolen Holding N.V.
12 12 %
Revenue breakdown in millions of months months
Euros 2003 2002 1)
----------------------------------------------------------------------
VDM Specialists 133.1 266.7
Net gain on principal
transactions 98.5 222.9 -56%
Commissions 27.2 33.4 -19%
Other 7.4 10.4 -29%
US Option Business 4.1 (2.0) 305%
European Trading 28.1 54.5 -48%
Unallocated and Holding 9.4 8.4 12%
----------------------------------------------------------------------
Total revenues 174.7 327.6 -47%
----------------------------------------------------------------------
----------------------------------------------------------------------
Van der Moolen Holding N.V.
Operating income before
amortization of intangible
fixed assets, before
impairment and before
exceptional expense relating 12 12
to provision NYSE/SEC months months
, breakdown in millions of Euros 2003 2002 1) %
----------------------------------------------------------------------
VDM Specialists 67.4 165.4 -59%
US Option Business (6.5) (17.2) 62%
European Trading (2.6) 6.8 -138%
Unallocated and Holding (0.4) (4.3) 91%
----------------------------------------------------------------------
Total operating income before
amortization of intangible
fixed assets, before
impairment and before
exceptional expense relating
to provision NYSE/SEC 57.9 150.7 -62%
----------------------------------------------------------------------
----------------------------------------------------------------------
VDM Specialists (VDMS) 12 12
months months
Key figures (Dutch GAAP) 2003 2002 1)
----------------------------------------------------------------------
VDM Specialists revenues
($ million) 149.9 252.0
Net gain on principal
transactions 110.8 210.6
Commissions 30.7 31.6
Other 8.4 9.8
Total value of trading on NYSE
($ billion) 9,692 10,311
Value of trading in VDMS
assignments ($ billion) 1,098 1,036
VDMS market share in dollar
value NYSE 11.3% 10.0%
VDMS value of principal
shares traded ($ billion) 309 358
Participation rate 28.1% 34.6%
VDMS net gain on principal
transactions ($ million) 110.8 210.6
Realization rate (basis
points) 3.6 5.9
----------------------------------------------------------------------
Source: NYSE, Van der Moolen
1) adjusted for purposes of comparison
Van der Moolen Holding N.V.
Consolidated Balance Sheet
(Dutch GAAP, unaudited)
----------------------------------------------------------------------
(amounts in millions of Euros)
December 31, 2003 December 31, 2002
----------------------------------------------------------------------
Assets
Fixed assets
Intangible fixed assets 83.5 163.2
Tangible fixed assets 6.3 9.3
Financial fixed assets 104.1 121.6
------ ------
193.9 294.1
Current assets
Long positions securities 302.0 457.0
Clearing organizations and professional
parties 93.5 398.1
Accrued income and other receivables 33.4 11.5
Cash and cash-equivalents 261.6 334.0
------ ------
690.5 1,200.6
----------------------------------------------------------------------
Total assets 884.4 1,494.7
----------------------------------------------------------------------
Shareholders' equity and liabilities
Shareholders' equity 201.5 312.2
Minority interest 33.0 62.0
------ ------
Group equity 234.5 374.2
Provisions
Deferred tax liabilities 4.7 10.3
Other provisions 44.6 2.0
------ ------
49.3 12.3
Long-term liabilities
Subordinated debt 151.7 199.4
Long-term debt 2.0 6.9
------ ------
153.7 206.3
Short-term liabilities
Short positions securities 259.7 691.3
Clearing organizations and professional
parties 77.9 123.8
Short-term loans 48.3 8.3
Advanced by clearing organizations 25.2 42.5
Accrued expenses and other liabilities 35.8 36.0
------ ------
446.9 901.9
----------------------------------------------------------------------
Total shareholders' equity and
liabilities 884.4 1,494.7
----------------------------------------------------------------------
----------------------------------------------------------------------
Guarantee capital 386.2 573.6
----------------------------------------------------------------------
Van der Moolen Holding N.V.
Consolidated statement of cash flow/
Movement schedule of shareholders'equity
(Dutch GAAP, unaudited)
Consolidated statement of cash flow
----------------------------------------- -------------- -------------
(Amounts in millions of Euros) 12 12
months months
2003 2002 1)
----------------------------------------- -------------- -------------
Cash flow from operating activities
Net income (15.9) 58.5
Net gain on disposal of financial fixed
assets (1.9) -
Minority interest (8.3) 27.8
Depreciation and amortization of fixed
assets 9.1 11.9
Impairment fixed assets 46.9 21.5
Change deferred taxation (11.7) (6.1)
Change in provisions 42.6 (0.2)
Change in working capital (40.6) 117.6
------- ------
20.2 231.0
Cash flow from investing activities
Investments in tangible fixed assets (1.7) (3.2)
Disposals of tangible fixed assets 0.3 1.0
Acquired group companies, less cash
received - (63.8)
Investments in financial fixed assets (0.1) (0.2)
Divestments and repayments of financial
fixed assets 3.3 2.6
------- ------
1.8 (63.6)
Cash flow from financing activities
Net change in subordinated debt and long-
term liabilities (7.6) 37.8
Net change of short-term loans 35.4 (62.0)
Issued shares - 2.7
Purchase of common shares (8.1) -
Dividend payment (30.2) (22.7)
Net change in minority interest (9.1) (27.8)
Other movements - (0.2)
------- ------
(19.6) (72.2)
Currency exchange differences on cash and cash-
equivalents, net of amounts advanced by clearing
organizations (57.5) (61.2)
Change in cash and cash-equivalents, net of
amounts advanced by clearing organizations (55.1) 34.0
Cash and cash-equivalents, net of amounts
advanced by clearing organizations at January 1, 291.5 257.5
------- ------
Cash and cash-equivalents, net of amounts
advanced by clearing organizations at December
31, 236.4 291.5
-------------------------------------------------------- -------------
Movement in shareholders'equity
----------------------------------------- -------------- -------------
(Amounts in millions of euros) 12 12
months months
2003 2002
----------------------------------------- -------------- -------------
Shareholders' equity at January 1 312.2 265.7
Exercise of options - 2.1
Cash dividend (27.3) (19.8)
Currency exchange differences (56.4) (50.8)
Net income for the period January 1 -
December 31 (15.9) 58.5
Preferred dividend for the period January
1 - December 31 (2.9) (2.9)
Purchase of common shares (8.1) -
Recognition of deferred tax asset - 59.0
Other (0.1) (0.2)
------- ------
(110.7) 46.5
------- ------
Shareholders' equity at December 31 201.5 312.2
----------------------------------------- -------------- -------------
1) adjusted for purposes of comparison
Van der Moolen Holding N.V.
Net income and shareholders' equity
(US GAAP, unaudited)
----------------------------------------------------------------------
(amounts in millions of Euros) Q4 Q4 %
2003 2002
----------------------------------------------------------------------
Net income in accordance with Dutch GAAP (36.2) 6.7 -640%
Adjustments to reported net income
Amortization of intangible fixed assets (0.4) 0.8
Impairment of intangible fixed assets (35.8) (14.6)
Pensions 0.1 (1.2)
Stock options (0.8) (1.3)
Other (1.1) (0.4)
Taxation 6.2 1.9
----------------------
Net income in accordance with US GAAP (68.0) (8.1) 740%
Dividend on financing preferred shares 2.2 (0.8)
Net income in accordance with US GAAP
attributable to common shares (65.8) (8.9) 639%
Average number of common shares
outstanding 37,539,057 38,410,863
Diluted average number of common shares
outstanding 37,539,057 38,475,369
--------------------------------------------
(amounts in euros)
--------------------------------------------
Net income from ordinary activities per
common share in accordance with Dutch GAAP (0.91) 0.15 -690%
Net income per common share (including net
extraordinary income) in accordance with
Dutch GAAP (0.91) 0.15
Basic earnings per common share in
accordance with US GAAP (1.75) (0.23) 656%
Diluted net income from ordinary activities
per common share in accordance with Dutch
GAAP (0.91) 0.15 -691%
Diluted net income per common share
(including net extraordinary income) in
accordance with Dutch GAAP (0.91) 0.15
Diluted earnings per common share in
accordance with US GAAP (1.75) (0.23) 658%
12
(amounts in millions of Euros) Q3 months
2003 % 2003
----------------------------------------------------------------------
Net income in accordance with Dutch GAAP 5.5 -758% (15.9)
Adjustments to reported net income
Amortization of intangible fixed assets (0.4) (1.6)
Impairment of intangible fixed assets - (35.8)
Pensions - 0.1
Stock options (1.3) (4.7)
Other (1.1) (1.5)
Taxation (0.8) 2.4
----------- -----------
Net income in accordance with US GAAP 1.9 -3679% (57.0)
Dividend on financing preferred shares (0.7) 0.0
Net income in accordance with US GAAP
attributable to common shares 1.2 -5583% (57.0)
Average number of common shares
outstanding 37,685,279 37,797,329
Diluted average number of common shares
outstanding 37,685,279 37,797,329
------------------------------------------
(amounts in euros)
------------------------------------------
Net income from ordinary activities per
common share in accordance with Dutch
GAAP 0.13 -811% (0.42)
Net income per common share (including net
extraordinary income) in accordance with
Dutch GAAP 0.13 (0.42)
Basic earnings per common share in
accordance with US GAAP 0.03 -5605% (1.51)
Diluted net income from ordinary
activities per common share in accordance
with Dutch GAAP 0.13 -811% (0.42)
Diluted net income per common share
(including net extraordinary income) in
accordance with Dutch GAAP 0.13 (0.42)
Diluted earnings per common share in
accordance with US GAAP 0.03 -5605% (1.51)
(amounts in millions of Euros) 12 months %
2002
----------------------------------------------------------------------
Net income in accordance with Dutch GAAP 58.5 -127%
Adjustments to reported net income
Amortization of intangible fixed assets (1.0)
Impairment of intangible fixed assets (14.6)
Pensions (0.8)
Stock options (5.5)
Other (1.5)
Taxation (5.0)
-----------
Net income in accordance with US GAAP 30.1 -289%
Dividend on financing preferred shares (2.9)
Net income in accordance with US GAAP attributable to
common shares 27.2 -310%
Average number of common shares outstanding 38,388,043
Diluted average number of common shares outstanding 38,525,890
------------------------------------------------------
(amounts in euros)
------------------------------------------------------
Net income from ordinary activities per common share
in accordance with Dutch GAAP 1.45 -129%
Net income per common share (including net
extraordinary income) in accordance with Dutch GAAP 1.45
Basic earnings per common share in accordance with US
GAAP 0.71 -313%
Diluted net income from ordinary activities per common
share in accordance with Dutch GAAP 1.44 -129%
Diluted net income per common share (including net
extraordinary income) in accordance with Dutch GAAP 1.44
Diluted earnings per common share in accordance with
US GAAP 0.71 -314%
----------------------------------------------------------------------
(amounts in millions of Q4 Q4 Q3 12 12
Euros) % % months months %
2003 2002 2003 2003 2002
------------------------- ---------------- -------- ------------------
Depreciation and
amortization fixed
assets in accordance
with US GAAP
Depreciation 1.3 0.8 0.6 3.3 2.8
Amortization of
intangible fixed assets 1.5 2.4 1.7 6.6 9.3
------------ ----- --------------
Total depreciation and
amortization fixed
assets in accordance
with US GAAP 2.8 3.2 -13% 2.3 22% 9.9 12.1 -18%
------------------------- ---------------- -------- ------------------
------------------------- ----------------
(amounts in millions of Dec. Dec.
Euros ) 31, 31,
2003 2002
------------------------- ----------------
Shareholders' equity in
accordance with Dutch
GAAP 201.5 312.2
Adjustments to reported
shareholders' equity
Goodwill and specialist
assignments 152.7 219.2
Pensions 8.0 7.9
Taxation (15.3)(17.5)
Other 0.0 1.5
------------------------- ----------------
Shareholders' equity in
accordance with US GAAP 346.9 523.3
------------------------- ----------------
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