Stifel Financial Corporation · NYSE:SF
Stifel Financial — Q4 2015 Earnings Presentation
24 slides from Stifel Financial's earnings presentation, Feb 23, 2016
Slide 1: 4th Quarter and Full-Year 2015 Financial Results Presentation
4th Quarter and Full-Year 2015 Financial Results Presentation February 23, 2016
Slide 2: Disclaimer
Disclaimer Forward‐Looking Statements This presentation may contain “forward‐looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 that involve significant risks, assumptions, and uncertainties, including statements relating to the market opportunity and futu
Slide 3: Chairman's Comments
Chairman’s Comments “We are proud to report that 2015 was our 20th consecutive year of record net revenues. We completed two acquisitions: Sterne Agee in June, which added financial advisors and fixed income capabilities, and Barclays Wealth and Investment Management, Americas in December, which sig
Slide 4: Market Overview
Market Overview Market Valuations Rates Volatility / Volumes Underwriting Volumes and M&A Municipal U.S. U.S. U.S. 10yr Equity Corporate U.S. ECM U.S. DCM Bond DCM Announced Completed S&P 500 Dow Yield VIX ADV Bond ADV ($) ($) ($) M&A ($) M&A ($) 2015 Q4 2,044 17,425 2.30% 18.2 7,050 20,387 41,198 4
Slide 5: Financial Results
Financial Results 4
Slide 6: Stifel Financial Corp. Results - Three Months Ended December 31, 2015
Stifel Financial Corp. Results Three months ended December 31, 2015 Three Months Ended December 31, 2015 Three Months Ended (1) (2) (2) ($ in thousands, except per share amounts) Non‐GAAP Adjustments GAAP 12/31/14 % Change 9/30/15 % Change Total revenues $ 594,403 $ (632) $ 593,771 $ 590,675 0.6% $
Slide 7: Stifel Financial Corp. Results - Year Ended December 31, 2015
Stifel Financial Corp. Results Year ended December 31, 2015 Year Ended December 31, 2015 Year Ended ($ in thousands, except per share amounts) Non‐GAAP Adjustments (1) GAAP 12/31/14 (2) % Change Total revenues $ 2,377,623 $ (630) $ 2,376,993 $ 2,254,747 5.4% Interest expense 42,236 3,163 45,399 41,9
Slide 8: Source of Revenues
Source of Revenues Three Months Ended Year Ended % % % ($ in thousands) 12/31/15 12/31/14 Change 9/30/15 Change 12/31/15 12/31/14 Change Commissions $ 187,287 $ 180,127 4.0% $ 194,083 (3.5%) $ 749,536 $ 690,197 8.6% Principal transactions 107,464 91,617 17.3% 95,593 12.4% 389,319 409,929 (5.0%) Brok
Slide 9: Brokerage & Investment Banking Revenues
Brokerage & Investment Banking Revenues Three Months Ended Year Ended ($ in thousands) 12/31/15 12/31/14 % Change 9/30/15 % Change 12/31/15 12/31/14 % Change Global Wealth Management $ 166,339 $ 160,112 3.9% $ 169,319 (1.8%) $ 652,681 $ 638,502 2.2% Institutional Group Equity brokerage 54,837 67,377
Slide 10: Non-GAAP Non-Interest Expenses
Non‐GAAP Non‐Interest Expenses (1) _________________________________________________________ (1) Excludes adjustments for duplicative items associated with the integration of acquired businesses (merger‐related expenses). 9
Slide 11: Global Wealth Management
Global Wealth Management Three Months Ended Year Ended ($ in thousands) 12/31/15 12/31/14 % Change 9/30/15 % Change 12/31/15 12/31/14 % Change Commi s s i ons $ 128,395 $ 115,351 11.3% $ 134,476 (4.5%) $ 504,206 $ 453,730 11.1% Pri nci pa l tra ns a cti ons 37,944 44,761 (15.2%) 34,843 8.9% 148,475
Slide 12: Institutional Group
Institutional Group Three Months Ended Year Ended ($ in thousands) 12/31/15 12/31/14 % Change 9/30/15 % Change 12/31/15 12/31/14 % Change Net revenues $ 246,325 $ 276,222 (10.8%) $ 232,125 6.1% $ 975,594 $ 997,071 (2.2%) Compens a ti on a nd benefi ts 143,162 169,226 (15.4%) 143,911 (0.5%) 596,561 6
Slide 13: Non-GAAP Other Segment
Non‐GAAP Other Segment Year‐Over‐Year Change 12
Slide 14: Financial Condition
Financial Condition 13
Slide 15: Balance Sheet Growth
Balance Sheet Growth Resumed Asset Growth in 4Q15 14
Slide 16: Stifel Bank & Trust
Stifel Bank & Trust (an operating unit of GWM) As of 12/31/15 As of 12/31/14 As of 9/30/15 Actual ($) Yield (%) Actual ($) Yield (%) % Change Actual ($) Yield (%) % Change Assets Cash 178,075 0.25 119,501 0.31 49.0% 22,173 0.26 703.1% (1) Investment securities 3,479,336 2.75 2,684,947 2.61 29.6% 1,7
Slide 17: Capital Structure
Capital Structure (in thousands, except ratios) As of As of ($ in thousands) 12/31/15 12/31/14 9/30/15 Total Assets $13,335,915 $ 9,518,151 $ 9,359,179 Stockholders' Equity 2,492,416 2,322,038 2,493,090 4.250% senior notes, due 2024 $ 300,000 $ 300,000 $ 300,000 5.375% senior notes, due 2022 150,000
Slide 18: Share Repurchases
Share Repurchases Shares Avg. Price Cost Through 9/30/15 1,224,000 $ 42.40 $ 51,893,616 Since 9/30/15 3,258,000 $ 39.99 130,302,925 Total 4,482,000 $ 40.65 $ 182,196,541 9.1 Million Shares Remain Under The Current Authorization 17
Slide 19: Acquisition Updates
Acquisition Updates 18
Slide 20: Acquisition Philosophy
Acquisition Philosophy Strategic combinations need to be accretive to: Shareholders Expected revenue and EPS growth in a reasonable timeframe Financial metrics: 1. Ascertain our view of enterprise value 2. Determine the split of value between shareholders and employees a) Capitalize purchase price
Slide 21: Barclays Overview
Barclays Overview Transaction Overview Financial Projections $147 million total pre‐tax investment, as follows: Revenue range of $160‐$190 million $115 million Non‐GAAP charges, including stock‐based Pre‐tax margins of 20% ‐ 25% (inclusive of amortization compensation, assumed legacy broker
Slide 22: Sterne Non-GAAP
Sterne Non‐GAAP Actual vs. Original Estimate (as presented on 2/23/15) 21
Slide 23: Non-GAAP Deal Integration Costs
Non‐GAAP Deal Integration Costs 22
Slide 24: 23
23