Financials

v3.19.1
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION - USD ($)
$ in Thousands
Dec. 31, 2018
Jan. 01, 2018
Dec. 31, 2017
Dec. 31, 2016
Dec. 31, 2015
ASSETS          
Cash and cash equivalents $ 182,693 $ 172,103 $ 172,103 $ 98,930  
Securities owned, at fair value 10,923 3,881 3,881    
Receivables from clearing brokers 24,068 48,543 48,543    
Receivables from other broker-dealers 7,078 2,822 2,822    
Notes receivable from financial advisors, net 5,809 6,803 47,369    
Other receivables, net 133,242 119,356 60,707    
Fixed assets, net 29,994 23,621 23,621    
Restricted cash 6,588 760 760 1,011  
Intangible assets, net 73,064 79,966 103,611    
Goodwill 126,079 124,210 124,210 124,031  
Contract acquisition costs, net 80,726 61,340 0    
Cash surrender value of life insurance 11,406 12,711 12,711    
Income taxes receivable 2,156   0    
Other assets 47,078 31,712 31,687    
Total assets 740,904 687,828 632,025 546,003  
LIABILITIES AND SHAREHOLDERS’ EQUITY          
Securities sold, but not yet purchased, at fair value 2,575 231 231    
Accrued compensation 39,192 33,233 33,343    
Commissions and fees payable 105,306 96,616 67,221    
Accounts payable and accrued liabilities 48,813 39,241 40,478    
Deferred rent 2,956 2,151 2,151    
Deferred income taxes 14,068   2,968    
Deferred compensation liability 20,622 18,161 18,161    
Accrued interest 123 232 232    
Notes payable, net of unamortized discount of $6,372 and $424 in 2018 and 2017, respectively, and net of debt issuance costs of $7,086 and $3,412 in 2018 and 2017 respectively. 254,072 96,849 96,849    
Total liabilities 487,727 292,652 261,634    
Commitments and contingencies (Note 14)      
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, 146,535,796 in 2018 and 198,583,941 in 2017 14 20 20    
Additional paid-in capital 344,356 520,135 520,135    
Accumulated deficit (91,246) (125,004) (149,778)    
Total shareholders’ equity of the Company 253,126 395,153 370,379    
Noncontrolling interest 51 23 12    
Total shareholders' equity 253,177 395,176 370,391 $ 362,501 $ 376,031
Total liabilities and shareholders' equity $ 740,904 $ 687,828 $ 632,025    

Source

v3.19.1
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)
$ in Thousands
3 Months Ended 12 Months Ended
Dec. 31, 2018
Sep. 30, 2018
Jun. 30, 2018
Mar. 31, 2018
Dec. 31, 2017
Sep. 30, 2017
Jun. 30, 2017
Mar. 31, 2017
Dec. 31, 2018
Dec. 31, 2017
Dec. 31, 2016
Revenues:                      
Commissions                 $ 696,331 $ 536,028 $ 510,023
Advisory fees                 474,423 560,930 464,136
Investment banking                 56,256 46,453 25,453
Principal transactions                 (328) 857 751
Interest and dividends                 4,971 2,550 2,879
Service fees                 119,430 85,330 71,515
Other income                 40,053 36,004 32,196
Total revenues $ 355,121 $ 348,875 $ 357,756 $ 329,384 $ 344,016 $ 322,309 $ 311,536 $ 290,291 1,391,136 1,268,152 1,106,953
Expenses:                      
Commissions and fees                 976,596 928,430 818,000
Compensation and benefits                 194,045 171,344 152,592
Non-cash compensation                 5,882 5,539 5,311
Brokerage, communication and clearance fees                 16,088 18,124 15,719
Rent and occupancy, net of sublease revenue                 9,977 9,356 9,673
Professional services                 21,927 19,588 14,126
Interest                 10,796 2,710 4,262
Depreciation and amortization                 24,039 28,835 28,334
Acquisition-related expenses                 1,010 3,469 1,357
Amortization of retention and forgivable loans                 417 7,396 5,472
Amortization of contract acquisition costs                 9,671 0 0
Other                 73,285 72,200 64,177
Total expenses 342,060 336,164 343,822 321,687 344,095 317,649 310,286 294,961 1,343,733 1,266,991 1,119,023
Income (loss) before item shown below 13,061 12,711 13,934 7,697 (79) 4,660 1,250 (4,670) 47,403 1,161 (12,070)
Change in fair value of contingent consideration (73) (54) (50) (61) (67) (3) (63) 152 (238) 19 (216)
Income (loss) before income taxes 12,988 12,657 13,884 7,636 (146) 4,657 1,187 (4,518) 47,165 1,180 (12,286)
Income tax expense (benefit)                 13,379 (6,502) 10,025
Net income (loss) 9,562 9,450 9,310 5,464 6,634 3,402 1,325 (3,679) 33,786 7,682 (22,311)
Net income (loss) attributable to noncontrolling interest 6 13 8 1 (10) 3 (3) (5) 28 (15) (42)
Net income (loss) attributable to the Company 9,556 9,437 9,302 5,463 6,644 3,399 1,328 (3,674) 33,758 7,697 (22,269)
Dividends declared on preferred stock (8,508) (8,507) (8,508) (8,508) (8,456) (8,149) (7,953) (7,924) (34,031) (32,482) (30,438)
Net loss available to common shareholders $ 1,048 $ 930 $ 794 $ (3,045) $ (1,812) $ (4,750) $ (6,625) $ (11,598) $ (273) $ (24,785) $ (52,707)
Net loss per share available to common shareholders (basic) (in USD per share) $ 0.01 $ 0.00 $ 0.00 $ (0.02) $ (0.01) $ (0.02) $ (0.03) $ (0.06) $ 0.00 $ (0.13) $ (0.29)
Net loss per share available to common shareholders (diluted) (in USD per share) $ 0.01 $ 0.00 $ 0.00 $ (0.02) $ (0.01) $ (0.02) $ (0.03) $ (0.06) $ 0.00 $ (0.13) $ (0.29)
Weighted average common shares used in computation of per share data:                      
Basic (in shares) 189,463,849 196,381,910 196,557,837 195,898,794 194,749,001 192,912,643 192,304,828 192,270,615 194,562,916 193,064,550 182,987,850
Diluted (in shares) 198,743,096 208,387,236 209,855,936 195,898,794 194,749,001 192,912,643 192,304,828 192,270,615 194,562,916 193,064,550 182,987,850

Source

v3.19.1
CONSOLIDATED STATEMENTS OF CASH FLOWS
$ in Thousands
12 Months Ended
Dec. 31, 2018
USD ($)
Dec. 31, 2017
USD ($)
Dec. 31, 2016
USD ($)
Cash flows from operating activities:      
Net income (loss) $ 33,786 $ 7,682 $ (22,311)
Adjustments to reconcile net income (loss) to      
Change in fair value of contingent consideration 238 (19) 216
Adjustment to deferred rent 805 387 213
Amortization of intangible assets 15,578 21,327 20,703
Depreciation and other amortization 8,461 7,508 7,631
Amortization of debt discount 432 449 620
Amortization of debt issue cost 591 41 253
Amortization of retention and forgivable loans 417 7,396 5,472
Amortization of contract acquisition costs 9,671 0 0
Deferred income taxes 8,130 (7,662) 9,096
Benefit attributable to reduction of goodwill 541 0 0
Non-cash interest expense on forgivable loan 0 24 43
Gain on forgiveness of accrued interest under forgivable loans (79) (295) (408)
Gain on forgiveness of principal of note payable under forgivable loans (2,143) (2,143) (2,143)
Non-cash compensation expense 5,882 5,539 5,311
Loss on write-off of furniture, fixtures and leasehold improvements, net 26 21 1
(Increase) decrease in operating assets:      
Securities owned, at fair value (7,042) (338) 536
Receivables from clearing brokers 24,475 (7,051) 2,974
Receivables from other broker-dealers (4,256) (1,969) 1,297
Other receivables, net (13,886) (6,073) (6,070)
Contract acquisition costs, net (29,057) 0 0
Notes receivable from financial advisors, net 577 (21,563) (11,116)
Cash surrender value of life insurance 1,305 (2,501) (963)
Income taxes receivable (2,156) 0 0
Other assets (15,366) 219 1,191
Increase (decrease) in operating liabilities:      
Securities sold, but not yet purchased, at fair value 2,344 (151) 144
Accrued compensation 5,959 7,044 (2,816)
Accrued interest (30) 222 (177)
Commissions and fees payable 8,690 6,627 599
Deferred compensation liability 2,461 914 36
Accounts payable and accrued liabilities 7,018 580 3,914
Net cash provided by operating activities 63,372 16,215 14,246
Cash flows from investing activities:      
Other business acquisitions 0 (179) (4,097)
Purchases of fixed assets (14,502) (9,896) (7,132)
Purchase of intangible assets (6) 0 0
Net cash used in investing activities (17,808) (10,075) (11,229)
Cash flows from financing activities:      
Issuance of Series A preferred stock (273) 28,095 27,580
Issuance of common stock 4,266 9,066 3,061
Series A preferred stock dividends paid (34,031) (32,482) (30,438)
Common stock dividends paid (8,794) (3,880) 0
Repurchases and retirement of common stock (69,746) (5,293) (14,749)
Repurchase of stock option award for cash (3,000) (850) 0
Additional issuance costs related to SSN notes 0 (40) 0
Issuance of senior notes 104,375 73,197 0
Borrowings on term loan 0 8,000 0
Principal repayments on notes payable (15,253) (7,039) (7,516)
Principal repayments under a revolving credit facility, net 0 0 (114)
Bank loan and revolver repayments (6,690) (1,992) (628)
Third party investment in subsidiary 0 0 40
Net cash (used in) provided by financing activities (29,146) 66,782 (22,764)
Net increase (decrease) in cash and cash equivalents 16,418 72,922 (19,747)
Cash and cash equivalents including restricted cash, beginning of period 172,863 99,941 119,688
Cash and cash equivalents 182,693 172,103 98,930
Restricted cash 6,588 760 1,011
Cash and cash equivalents including restricted cash, end of period 189,281 172,863 99,941
Supplemental cash flow information:      
Interest paid 9,870 1,974 3,523
Taxes paid 6,956 1,487 1,036
Non-cash financing activities:      
Issuance of 7.25% notes for repurchase of common stock 76,350 0 0
Cancellation of promissory notes as consideration for exercise price of warrants 0 0 17,976
Kestler Financial Group, Inc      
Cash flows from investing activities:      
Net cash paid in acquisition (2,850) 0 0
Supplemental cash flow information:      
Net cash paid in acquisition 2,850 0 0
Four Seasons Financial Group      
Cash flows from investing activities:      
Net cash paid in acquisition (450) 0 0
Supplemental cash flow information:      
Assets acquired 2,345 0 0
Liabilities assumed (1,523) 0 0
Net assets acquired 822 0 0
Promissory note (372) 0 0
Net cash paid in acquisition 450 0 0
Acquisition of Wall Street Financial Group      
Cash flows from investing activities:      
Net cash paid in acquisition 0 0 (1,192)
Supplemental cash flow information:      
Assets acquired 0 0 3,468
Liabilities assumed 0 0 (2,276)
Net cash paid in acquisition 0 0 1,192
Acquisition of Foothill Securities Inc      
Cash flows from investing activities:      
Net cash paid in acquisition 0 179 (2,905)
Supplemental cash flow information:      
Assets acquired 0 0 5,571
Liabilities assumed 0 (179) (2,666)
Net cash paid in acquisition 0 (179) 2,905
Acquisition of Kestler Financial Group      
Cash flows from investing activities:      
Net cash paid in acquisition (2,850) 0 0
Supplemental cash flow information:      
Assets acquired 9,093 0 0
Liabilities assumed (793) 0 0
Net assets acquired 8,300 0 0
Promissory note (5,450) 0 0
Net cash paid in acquisition $ 2,850 $ 0 $ 0

Source