Stifel Financial Corporation · NYSE:SF
Stifel Financial — Q2 2009 Earnings Presentation
25 slides from Stifel Financial's earnings presentation, Aug 10, 2009
Slide 1: Stifel Financial Corp. 2nd Quarter 2009 Earnings Conference Call
Stifel Financial Corp. 2nd Quarter 2009 Fiscal Year Earnings Conference Call August 10, 2009
Slide 2: Forward-Looking Statements
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 future business
Slide 3: 2nd Quarter 2009 Highlights
24 Quarter 2009 Highlights Record net revenues of $261.5 million, a 25% increase from the 2°¢ Quarter (2Q) 2008. >» The Private Client Group (PCG) segment recorded record net revenues of $131.2 million, an 8% increase from the 2Q08. >» The Capital Markets (CM) segment recorded record net revenues of
Slide 4: YTD 2009 Highlights
YTD 2009 Highlights Record net revenues of $481.5 million, a 15% increase from first half of fiscal 2008 (6m08). >» The PCG segment recorded record net revenues of $241.7 million, a 3% increase from 6m08. » The CM segment recorded record net revenues of $230.6 million, a 31% increase over 6m08. Net
Slide 5: Firm Net Revenues and growth since 2004
Firm Net Revenues (failtions) Equity Capital (iltions) Share Price Market Cap (fniltions) Total Associates Frivate Client Group Financial Advisors Branch Support Offices Capital Markets Equity Sales & Trading Professionals Fixed Income Sales & Trading Professionals Investment Banking Professionals P
Slide 6: ACAT Fee Reimbursement
ACAT Fee Reimbursement 2009 Reimbur sed Reimbursed Qtr No. ACAT Fees Fees Ql 15,857 (81,384,000) 4,872 ($406,000) Q2 39,151 (3,657,000) 7,708 (653,000) Total 55,008 (5,041,000) 12,580 ($1,059,000)
Slide 7: Income Statements
Stifel Financial Corp. Income Statements Quarters Ended Change YTD Change (8 in thousands) 06/30/09 06/30/08 8 % o6/30/09 _ 06/30/08 $ % Net Revenues $ 261505 $ 208951 $ 52,554 25% $481,486 $ 420428 $ 61,058 15% Compensation and Benefits 175,881 144,795 31,086 21% 323,721 290,825 32,896 11% Non-Comp
Slide 8: Normalized Pro Forma
Normalized Pro Forma Six Months ended June 30, 2009 Pre-Tax Net Operating % of (8 in thousands) Revenues Contributions _Net Rev As Reported $ 481,486 | $ 48,264 10% Pro Forma Adjustments | Private Client Group (PCG) PCG established business 22,207 9,929 PCG new business (29,445) 6,110 Bank excess li
Slide 9: Source of Revenues
Source of Revenues Quarters Ended Change YTD Change ot Net ot Met ot Met of Net (8 im thousands) sonoo9 Frm 6/30/2008 Revems $ % | 6onoo9 Ferm 6/30/2008 Reveme $ % Revenues Commissions $ 80,721 30.9% $ 83,063 39.8% $ (2,342) (3%) |$ 155,331 32.3% $168,764 40.1% $(13,433) (8%) Principal transactions
Slide 10: Segment Comparison
Segment Comparison Total net revenues increased 25% despite difficult market conditions in 2Q09.
Slide 11: YTD Segment Comparison (Excludes Acquisitions)
YTD Segment Comparison (Excludes Acquisitions) Balanced business model facilitates growth during volatile markets Stable PCG business is augmented by profitable and growing Capital Markets.
Slide 12: Private Client Group Income Statements
Private Client Group Income Statements Commission & fee growth impacted by market decline Margins were lower due to market conditions, decline of managed money balances, and the opening of new offices and hiring Financial Advisors.
Slide 13: Capital Markets Income Statements
Capital Markets Income Statements Industry wide slowdown in trading activity offset by market share gains Investment Banking weakness is driven by lack of public market activity
Slide 14: Capital Markets Revenues
Capital Markets Revenues Commissions & principal transactions increased 51% during the quarter Advisory business grew in the quarter
Slide 15: Stifel Bank & Trust Income Statements
Stifel Bank & Trust Income Statements
Slide 16: Stifel Bank & Trust Balance Sheet
Stifel Bank & Trust Balance Sheet Investment portfolio grew $74 million from 3/31/09 to total $133 million as of 6/30/09 Purchases since quarter-end added an additional $85 million, increasing the portfolio to $219 million The $159 million in purchases represent more than a 300 basis increase in yie
Slide 17: Stifel Financial Balance Sheet Graphs
Stifel Financial Balance Sheet Graphs Total Assets, Total Capitalization, Leverage Ratio, Book Value per Share
Slide 18: Stifel Bank & Trust Balance Sheet
Stifel Bank & Trust Balance Sheet » Investment portfolio grew $74 million from 3/31/09 to total $133 million as of 6/30/09 «Purchases since quarter-end added an additional $85 million, increasing the portfolio to $219 million + The $159 million in purchases represent more than a 300 basis increase i
Slide 19: Other Segment Analysis
Other Segment Analysis (8 in thousands) Net Revenue Compensation and Benefits Occupancy and Equipment Communication and Office Supplies Commission and Floor Brokerage Other Operating Expenses Total Non-interest Expenses Income before Income Taxes Acquisition-Related Other and Acqui ion-Related Quart
Slide 20: Total Assets, Capitalization, Leverage, Book Value Per Share
$2,400 $1,800 $1,499 $1,562 $1,200 2002 2003 20042005 20052007 ons Q2 2009 Total Assets ($ mittions) 3.7% 202 2003, 204 ms 6 2007, 2008 Q2. 2009 Leverage Ratio $800 $600 $703 $400 $200 4 7 2002 2003-2004 «20052006 §=— 2007 2008 e209 Total Capitalization ($ mitions) Defined as stockholder’ s equity p
Slide 21: Stifel Outlook
Stifel Outlook Unstable conditions in the Private Client market presents opportunity for Stifel to continue to grow organically and through M&A The uncertainty surrounding the largest domestic and European private client platforms impacts thousands of US-based Financial Advisors. Success with UBS si
Slide 22: Market Turmoil = Opportunity
Market Turmoil = Opportunity Stifel has one of the fastest growing private wealth management businesses in the industry. Stifel Equity Research is 3rd largest research department in the U.S. and the largest provider of small cap coverage.
Slide 23: Other Financial Data
Other Financial Data Other Data 6/30/2009 Quarterly Data 3/31/2009 6/30/2008 Bank Assets SN & SF Assets Total Assets (000's) Stockholders Equity (000's) Book value Per Share Financial Advis ors * Full Time Employees Locations Total Client Assets (000s) “Includes all etal Financial Advisors. 539,703
Slide 24: Stifel Outlook
Stifel Outlook > Unstable conditions in the Private Client market presents opportunity for Stifel to continue to grow organically and through M&A » The uncertainty surrounding the largest domestic and European private client platforms impacts thousands of US-based Financial Advisors. » Success with
Slide 25: Q&A - Questions and Answers
Q&A - Questions and Answers