Financials

v3.10.0.1
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION - USD ($)
$ in Thousands
Sep. 30, 2018
Jan. 01, 2018
Dec. 31, 2017
Sep. 30, 2017
ASSETS        
Cash and cash equivalents $ 262,834 $ 172,103 $ 172,103 $ 100,739
Securities owned, at fair value 5,451 3,881 3,881  
Receivables from clearing brokers 26,650 48,543 48,543  
Receivables from other broker-dealers 1,472 2,822 2,822  
Notes receivable from financial advisors, net 6,520 6,803 47,369  
Other receivables, net 130,507 119,356 60,707  
Fixed assets, net 28,590 23,621 23,621  
Restricted cash 6,589 760 760  
Intangible assets, net 74,233 79,966 103,611  
Goodwill 125,966 124,210 124,210  
Contract acquisition costs, net 77,803 61,340 0  
Cash surrender value of life insurance 13,478 12,711 12,711  
Other assets 40,498 31,712 31,687  
Total assets 800,591 687,828 632,025 $ 552,615
LIABILITIES:        
Securities sold, but not yet purchased, at fair value 66 231 231  
Accrued compensation 32,013 33,233 33,343  
Commissions and fees payable 109,247 96,616 67,221  
Accounts payable and accrued liabilities 50,122 39,241 40,478  
Deferred rent 2,970 2,151 2,151  
Deferred income taxes 12,659 6,603 2,968  
Deferred compensation liability 21,963 18,161 18,161  
Accrued interest 0 232 232  
Notes payable, net of unamortized discount of $115 and $424 in 2018 and 2017, respectively and net of debt issuance costs of $7,191 and $3,412 in 2018 and 2017, respectively. 185,199 96,849 96,849  
Total liabilities 414,239 293,317 261,634  
Commitments and contingencies (Note 11)  
SHAREHOLDERS' EQUITY:        
Preferred stock, $.0001 par value; authorized 50,000,000 shares: 8% Series A cumulative redeemable preferred stock; designated 23,844,916 shares in 2018 and 2017; shares issued and outstanding 17,012,075 in 2018 and 2017 (liquidation preference $425,302 in 2018 and 2017) 2 2 2  
Common stock, $.0001 par value; authorized 1,000,000,000 shares in 2018 and 2017; shares issued and outstanding, 200,251,796 in 2018 and 198,583,941 in 2017 20 20 20  
Additional paid-in capital 487,752 520,135 520,135  
Accumulated deficit (101,467) (125,669) (149,778)  
Total shareholders’ equity of the Company 386,307 394,488 370,379  
Noncontrolling interest 45 23 12  
Total shareholders' equity 386,352 394,511 370,391  
Total liabilities and shareholders' equity $ 800,591 $ 687,828 $ 632,025  

Source

v3.10.0.1
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)
$ in Thousands
3 Months Ended 9 Months Ended
Sep. 30, 2018
Sep. 30, 2017
Sep. 30, 2018
Sep. 30, 2017
Revenues:        
Commissions $ 172,108 $ 131,467 $ 515,775 $ 394,492
Investment banking 9,982 14,745 38,201 34,121
Principal transactions 45 107 445 685
Interest and dividends 1,434 629 3,301 1,921
Service fees 28,702 19,277 81,189 58,169
Other income 12,054 9,407 35,533 26,426
Total revenues 348,875 322,309 1,036,015 924,136
Expenses:        
Commissions and fees 249,672 235,020 735,388 679,843
Compensation and benefits 44,905 45,131 140,727 125,131
Non-cash compensation 1,380 1,341 4,442 4,148
Brokerage, communication and clearance fees 3,734 4,173 11,994 13,647
Rent and occupancy, net of sublease revenue 2,566 2,305 7,446 7,165
Professional services 4,531 4,715 14,860 12,609
Interest 3,206 601 7,226 1,599
Depreciation and amortization 5,845 7,104 17,416 21,830
Acquisition-related expenses 0 55 913 320
Amortization of retention and forgivable loans 97 1,808 280 5,070
Amortization of contract acquisition costs 2,488 0 7,059 0
Other 17,740 15,396 53,922 51,534
Total expenses 336,164 317,649 1,001,673 922,896
Income before item shown below 12,711 4,660 34,342 1,240
Change in fair value of contingent consideration (54) (3) (165) 86
Income before income taxes 12,657 4,657 34,177 1,326
Income tax expense 3,207 1,255 9,953 278
Net income 9,450 3,402 24,224 1,048
Net income (loss) attributable to noncontrolling interest 13 3 22 (5)
Net income attributable to the Company 9,437 3,399 24,202 1,053
Dividends declared on preferred stock (8,507) (8,149) (25,523) (24,026)
Net income (loss) available to common shareholders $ 930 $ (4,750) $ (1,321) $ (22,973)
Net income (loss) per common share available to common shareholders (basic) (in dollars per share) $ 0.00 $ (0.02) $ (0.01) $ (0.12)
Net income (loss) per common share available to common shareholders (diluted) (in dollars per share) $ 0.00 $ (0.02) $ (0.01) $ (0.12)
Weighted average common shares used in computation of per share data:        
Basic (in shares) 196,381,910 192,912,643 196,281,283 192,498,380
Diluted (in shares) 208,387,236 192,912,643 196,281,283 192,498,380
Advisory fees        
Revenues:        
Advisory fees $ 124,550 $ 146,677 $ 361,571 $ 408,322

Source

v3.10.0.1
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)
$ in Thousands
9 Months Ended
Sep. 30, 2018
Sep. 30, 2017
Cash flows from operating activities:    
Net income $ 24,224 $ 1,048
Adjustments to reconcile net income to    
Change in fair value of contingent consideration 165 (86)
Adjustment to deferred rent 819 319
Amortization of intangible assets 11,552 16,142
Amortization of debt discount 428 337
Amortization of debt issue cost 401 0
Amortization of retention and forgivable loans 280 5,070
Amortization of contract acquisition costs 7,059 0
Depreciation and other amortization 5,864 5,688
Deferred income taxes 6,056 (161)
Non-cash interest expense on forgivable loan 0 266
Non-cash compensation expense 4,442 4,148
Gain on forgiveness of accrued interest under forgivable loans (79) 0
Gain on forgiveness of principal of note payable under forgivable loans (2,143) 0
Loss on write-off of furniture, fixtures and leasehold improvements, net 18 1
(Increase) decrease in operating assets    
Securities owned, at fair value (1,570) (604)
Receivables from clearing brokers 21,893 (15,230)
Receivables from other broker-dealers 1,350 (1,074)
Other receivables, net (11,151) 5,843
Contract acquisition costs, net (23,522) 0
Notes receivable from financial advisors, net 3 (6,443)
Cash surrender value of life insurance (767) (1,990)
Other assets (8,786) (5,019)
Increase (decrease) in operating liabilities    
Securities sold, but not yet purchased, at fair value (165) (184)
Accrued compensation (1,220) 2,308
Accrued interest (153) (65)
Commissions and fees payable 12,631 1,790
Deferred compensation liability 3,802 1,239
Accounts payable and accrued liabilities 9,932 3,105
Net cash provided by operating activities 61,363 16,448
Cash flows from investing activities:    
Purchases of fixed assets (10,503) (7,258)
Purchase of intangible assets (6) 0
Net cash used in investing activities (12,192) (7,438)
Cash flows from financing activities:    
Issuance of Series A preferred stock (180) 18,032
Issuance of common stock 4,001 4,376
Issuance of senior notes 106,081 0
Series A preferred stock dividends paid (25,523) (24,026)
Common stock dividends paid (6,377) (1,962)
Repurchase of stock option award for cash 0 (850)
Repurchase and retirement of common stock (8,746) (4,450)
Borrowings on term loan 0 8,000
Bank loan and revolver repayments (6,658) (1,305)
Principal payments on notes payable (15,209) (5,267)
Net cash provided by (used in) financing activities 47,389 (7,452)
Net increase in cash and cash equivalents 96,560 1,558
Cash and cash equivalents including restricted cash, beginning of period 172,863 99,941
Cash and cash equivalents including restricted cash, end of period 269,423 101,499
Cash and cash equivalents including restricted cash, end of period 172,863 99,941
Supplemental cash flow information:    
Interest paid 6,551 1,062
Taxes paid 2,786 566
Kestler Financial Group    
Cash flows from investing activities:    
Acquisition of certain assets (1,683) 0
Supplemental cash flow information:    
Assets acquired 7,917 0
Liabilities assumed (784) 0
Net assets acquired 7,133 0
Promissory note (5,450) 0
Foothill Securities Inc    
Cash flows from investing activities:    
Acquisition of certain assets 0 (180)
Supplemental cash flow information:    
Assets acquired $ 0 $ 0

Source