Stifel Financial Corporation · NYSE:SF
Stifel Financial — Q1 2015 Earnings Presentation
24 slides from Stifel Financial's earnings presentation, May 11, 2015
Slide 1: 1st Quarter 2015 Financial Results Presentation
1st Quarter 2015 Financial Results Presentation May 11, 2015
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 pleased with our first quarter results, which represent our third best revenue quarter. That said, while investment banking was a good quarter, results can and will be lumpy, especially as we continue to build-out our capabilities. Looking forward, we are optimistic about
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 ($) 2015 Q1 2,068 17,776 1.92% 15.3 6,916 24,777 89,751 5
Slide 5: Financial Results
Financial Results 4
Slide 6: Stifel Financial Corp. Results
Stifel Financial Corp. Results Three months ended March 31, 2015 Three Months Ended March 31, 2015 Three Months Ended (1) (2) (2) ($ in thousands, except per share amounts) Non-GAAP Non-Core GAAP 3/31/14 % Change 12/31/14 % Change Total revenues $ 574,001 $ - $ 574,001 $ 557,342 3.0% $ 590,673 (2.8%
Slide 7: Q1 2015 Core Results vs. Estimates
Q1 2015 Core Results vs. Estimates 6
Slide 8: Source of Revenues
Source of Revenues Three Months Ended % % ($ in thousands) 3/31/15 3/31/14 Change 12/31/14 Change Commissions $ 180,302 $ 172,243 4.7% $ 174,990 3.0% Principal transactions 100,205 110,360 (9.2%) 94,109 6.5% Brokerage revenues 280,507 282,603 (0.7%) 269,099 4.2% Capital raising 75,646 76,811 (1.5%)
Slide 9: Brokerage & Investment Banking Revenues
Brokerage & Investment Banking Revenues Three Months Ended ($ in thousands) 3/31/15 3/31/14 % Change 12/31/14 % Change Global Wealth Management $ 157,995 $ 160,151 (1.3%) $ 160,022 (1.3%) Institutional Group Equity brokerage 61,803 64,456 (4.1%) 67,273 (8.1%) Fixed income brokerage 60,709 57,995 4.7
Slide 10: Core Non-Interest Expenses
Core Non-Interest Expenses Three months ended March 31, 2015 Three Months Ended % of Net revenues (1) (1) ($ in thousands) 3/31/15 3/31/14 % Change 12/31/14 % Change 3/31/15 3/31/14 12/31/14 Net revenues $ 563,694 $ 548,445 2.8% $ 578,069 (2.5%) 100.0% 100.0% 100.0% Compensation and benefits 329,228
Slide 11: Segment Comparison - Core
Segment Comparison - Core Three Months Ended % ($ in thousands) 3/31/15 3/31/14 % Change 12/31/14 Change Net revenues: Global Wealth Management $ 329,410 $ 297,183 10.8% $ 310,980 5.9% Institutional Group 238,607 249,987 (4.6%) 272,686 (12.5%) Other (4,323) 1,275 nm (5,597) (22.8%) $ 563,694 $ 548,4
Slide 12: Global Wealth Management
Global Wealth Management Three Months Ended ($ in thousands) 3/31/15 3/31/14 % Change 12/31/14 % Change Commi s s i ons $ 116,214 $ 112,997 2.8% $ 115,351 0.7% Pri nci pa l tra ns a cti ons 41,781 47,154 (11.4%) 44,671 (6.5%) As s et ma na gement & s e rvi ce fe es 113,666 89,130 27.5% 105,511 7.7%
Slide 13: Stifel Bank & Trust
Stifel Bank & Trust (an operating unit of GWM) As of 3/31/15 As of 3/31/14 As of 12/31/14 Actual ($) Yield (%) Actual ($) Yield (%) % Change Actual ($) Yield (%) % Change Assets Cash 48,131 0.24 183,066 0.55 (73.7%) 119,501 0.31 (59.7%) (1) Investment securities 2,599,854 2.24 3,084,007 2.54 (15.7%)
Slide 14: Institutional Group
Institutional Group Three Months Ended ($ in thousands) 3/31/15 3/31/14 % Change 12/31/14 % Change Net revenues $ 238,607 $ 249,987 (4.6%) $ 272,686 (12.5%) Compens ati on a nd benefits 149,411 154,234 (3.1%) 176,897 (15.5%) Non-comp opera ti ng expens es 56,865 50,830 11.9% 61,002 (6.8%) Total non-
Slide 15: Financial Condition
Financial Condition 14
Slide 16: Capital Structure
Capital Structure (in thousands, except ratios) As of As of ($ in thousands) 3/31/15 3/31/14 12/31/14 Total Assets $ 9,373,137 $ 9,387,814 $ 9,518,151 Stockholders' Equity 2,363,244 2,100,140 2,322,038 4.250% senior notes, due 2024 $ 300,000 $ - $ 300,000 5.375% senior notes, due 2022 150,000 150,00
Slide 17: Historical Asset Balances
Historical Asset Balances (in thousands) 16
Slide 18: Other Financial Data
Other Financial Data As of As of 3/31/15 3/31/14 % Change 12/31/14 % Change Total assets (000s): Stifel Nicolaus & Stifel Financial $ 4,083,788 $ 4,376,827 (6.7%) $ 4,280,181 (4.6%) Stifel Bank 5,289,349 5,010,987 5.6% 5,237,970 1.0% Total assets 9,373,137 $ 9,387,814 (0.2%) 9,518,151 (1.5%) Total s
Slide 19: Acquisition Updates
Acquisition Updates 18
Slide 20: Strategic Vision
Strategic Vision To build the premier investment banking and wealth management firm Global Wealth Management Institutional Private Client Asset Bank Equities Sales Fixed Income Investment Research Management + Trading Sales + Trading Banking Over 2,800 $20B in total $5.3B in assets Experienced sales
Slide 21: Organic vs. Acquisition Growth
Organic vs. Acquisition Growth Organic growth has accounted for approximately 45% and acquisitions have accounted for approximately 55% of Stifel’s growth since 2004 Outlook on acquisitions: Position Stifel to take advantage of opportunities Fixed Income Equities Sales Investment Revenues Total Priv
Slide 22: Sterne Agee Acquisition Update
Sterne Agee Acquisition Update Expected to close on or around the end of May 2015 100% retention of Sterne Agee’s traditional financial advisors Stifel and Sterne Agee sold Sterne Agee’s Institutional Equities business, including Equity Sales, Trading and Research to CRT Capital Group Accomplished o
Slide 23: Non-Core Deal Costs
Non-Core Deal Costs Three months ended 3/31/15 Estimate ($ in thousands) Actual Estimate 6/30/15 9/30/15 12/31/15 3/31/16 6/30/16 Existing acquisitions Duplicative operating expenses: Acacia Federal Savings Bank - - - - - - - De La Rosa & Co., Inc. 86 120 120 120 - - - Keefe, Bruyette & Woods, Inc.
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