Stifel Financial Corporation · NYSE:SF
Stifel Financial — Q4 2017 Earnings Presentation
19 slides from Stifel Financial's earnings presentation, Jan 30, 2018
Slide 1: 4th Quarter & Full Year 2017 Financial Results Presentation
4th Quarter & Full Year 2017 Financial Results Presentation January 30, 2018
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: Highlights
Highlights Full Year 2017 • 22nd Consecutive Year of Record Net Revenue of $2.9 billion, up 14% • Net Income Available to Common Shareholders of $174 million or $2.14 per Diluted Share. • Record Institutional Group Revenue of $1.1 billion • Record Investment Banking Revenue of more than $727 • Recor
Slide 4: Impact of Tax Reform
Impact of Tax Reform • Recorded a $101 million charge in 4Q17 as a result of the change in the tax code: • $59 million was related to the acceleration of compensation expense ($0.72) • $42 million was related to the revaluation of our DTA ($0.52) • Settled last named litigation issue ($0.12) • Expec
Slide 5: 2017 & Fourth Quarter Results
2017 & Fourth Quarter Results Full Year Full Year Financial Highlights Non-GAAP U.S. GAAP (000s, except per share data) 2017 2016 % Change 2017 2016 Net revenues $2,928,416 $2,579,599 14% $2,926,432 $2,575,496 Compensation ratio 61.2% 62.8% -160 bps 66.9% 67.0% Non-compensation ratio 21.7% 24.1% -24
Slide 6: Brokerage Revenue & Asset Management & Service Fees
Brokerage Revenue & Asset Management & Service Fees Brokerage Revenue Three Months Ended Full Year (000s) 4Q17 4Q16 % Change 3Q17 % Change 2017 2016 % Change Global Wealth Management brokerage revenue $163,421 $160,017 2% $158,334 3% $661,334 $670,635 -1% Institutional brokerage: Equity Capital Mark
Slide 7: Investment Banking Revenue
Investment Banking Revenue Investment banking: Three Months Ended Full Year (000s) 4Q17 4Q16 % Change 3Q17 % Change 2017 2016 % Change Capital raising: Global Wealth Management revenue $8,899 $12,064 -26% $9,072 -2% $40,466 $42,187 -4% Equity Capital Markets 57,800 36,714 57% 43,277 34% 182,728 103,
Slide 8: Net Interest Income
Net Interest Income Net Interest Income Growth Average Yields on Balance Sheet $120 4Q17 4Q16 % Change 3Q'17 % Change $107 $100 $100 $92 Assets: Net Interest Income (mil.) $85 $75 Bank loans 3.27% 2.88% 39 bps 3.27% 0 bps $80 Commercial 3.86% 3.76% 10 bps 3.96% -10 bps $60 Securities based 3.19% 2.3
Slide 9: Segment Results
Segment Results 8
Slide 10: Global Wealth Management
Global Wealth Management Y/Y Sequential Y/Y millions 4Q17 Change Change 2017 Change Global Wealth Management Revenue Commissions $118 3% 3% $475 -3% Principal Transactions $45 0% 5% $187 4% Brokerage $163 2% 3% $662 -1% Asset Management & Service Fees $186 24% 4% $702 21% Net Interest $112 43% 9% $4
Slide 11: Stifel Bank & Trust
Stifel Bank & Trust % % (mil. except for %'s) 4Q17 4Q16 Change 3Q17 Change Assets: Investments $7,461 $6,209 20% $7,238 3% Mortgage Loans 2,594 2,161 20% 2,518 3% Commercial Loans 2,438 1,710 43% 2,380 2% Securities Based Loans 1,819 1,614 13% 1,840 -1% Total Loans, net $6,948 $5,591 24% $6,783 2% L
Slide 12: Institutional Group
Institutional Group Y/Y Sequential Y/Y Institutional Group Net Revenue millions 4Q17 Change Change 2017 Change $350 Ins titutional Revenue GAAP Net Revenue (mil.) $300 $250 Equity $200 Advisory $118 129% 20% $345 41% $150 Underwriting $58 57% 30% $183 77% $100 Brokerage $50 -23% 10% $200 -14% $50 $0
Slide 13: Balance Sheet
Balance Sheet 12
Slide 14: Balance Sheet
Balance Sheet Infrastructure Build ` 2008 2009 2010 2011 2012 2013 2014 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 Tier 1 Leverage 32.3% 30.5% 25.6% 21.4% 17.7% 15.4% 16.5% 16.4% 16.6% 11.6% 11.5% 11.8% 10.2% 10.1% 10.3% 10.4% 9.5% Tier 1 Risk Based Capital 49.4% 40.5% 29.1% 27.4% 26.8% 26.7%
Slide 15: GAAP & Non-GAAP Reconciliation
GAAP & Non-GAAP Reconciliation 14
Slide 16: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Three months ended December 31, 2017 Three months GAAP to Non-GAAP Reconciliation for Fourth Quarter 2017 GAAP Resul ts ended (000s) 12/31/17 (000s) 12/31/17 GAAP Net Income ($1,988) Total GAAP Compensation & benefits expense $620,256 Preferred Dividend 2,344 GAAP com
Slide 17: Progress Update
Progress Update 16
Slide 18: 10 Years of Substantial Growth
10 Years of Substantial Growth Revenue % of % of Ratios & Metrics 2017 Rev enue 2007 Rev enu e Change 2017 2007 Chan ge Income Statement Ex pens e Ratios * Total net revenue $2,928 $763 284% Total comp. ratio 61.2% 64.7% -350 bps Brokerage $1,076 37% $455 60% 137% Total non-comp. ratio 21.7% 20.8% 9
Slide 19: STIFEL
STIFEL