Firm's Fourth Quarter Net Income Grows 10 Percent
CHICAGO, Jan. 27 /PRNewswire/ -- EVEREN Capital Corporation (NYSE: EVR)
today reported net income of $71.3 million for the year ended December 31,
1998, a 53 percent increase over 1997 net income of $46.6 million.
Net income for 1998 includes a non-recurring net gain of approximately
$11.8 million from The Bank of New York's acquisition of an 80-percent
interest in EVEREN Capital's EVEREN Clearing Corp. subsidiary in the fourth
quarter. Excluding the one-time gain, EVEREN's 1998 net income was
$59.5 million.
Earnings per diluted common share for the year grew to $2.01 ($1.68
excluding the one-time gain) compared with earnings per diluted share of $1.35
in 1997, after adjusting for the company's two-for-one stock split effected in
the 1998 second quarter.
Net revenues, which include net interest, rose 27 percent to
$755.4 million for 1998, up from $593.1 million in 1997.
According to EVEREN Capital Corporation Chairman and Chief Executive
Officer James R. Boris, Volatility in the financial markets during 1998
underscored the value of focusing our resources on our retail, capital markets
and asset management businesses while at the same time restraining costs and
continuing a conservative risk profile.
"By following this strategy," he continued, "we positioned our firm for
growth during the year. We expanded our national distribution network with
our acquisition of Principal Financial Securities. We continued to focus on
shifting fixed expenses to variable wherever and whenever appropriate. The
formation of our clearing joint venture with The Bank of New York in the
fourth quarter is an important example of this approach as it enables us to
participate in a high-margin business while at the same time minimizing our
future fixed expenses.
"1998," Boris concluded, "was an important year for EVEREN. We generated
higher productivity and profitability and delivered solid earnings growth
despite significant market volatility during the second half of the year. We
look forward to continuing this track record of success in 1999."
EVEREN reported that commissions rose 30 percent to $349.1 million for the
year ended December 31, 1998 compared with $268.0 million a year ago. At year
end, the number of EVEREN investment consultants had increased to 1,820 up
from 1,352 in 1997.
The firm's asset management revenues improved 46 percent to $107.8 million
in 1998 from $73.6 million the prior year. Client assets grew to
$63.4 billion from $48.9 billion in 1997.
Investment banking revenues from underwriting and advisory fees rose
24 percent to $86.0 million for the year from $69.5 million in 1997.
Net interest and dividend revenues increased to $53.7 million in 1998, up
11 percent from $48.5 million a year ago.
Non-interest expenses of $659.5 million in 1998 increased from
$518.1 million for the year ended December 31, 1997. EVEREN's pretax margin
for 1998, excluding the one-time gain, was 12.7 percent versus 12.6 percent
for 1997, while the after-tax margin was 7.9 percent in 1998 compared with
7.8 percent last year.
Stockholders' equity as of December 31, 1998 was approximately
$408.6 million, or $11.70 per outstanding share, up from $334.9 million, or
$9.78 per outstanding share, a year earlier. Return on average common equity,
excluding the one-time gain, was approximately 16.3 percent for the year ended
December 31, 1998 compared with 14.9 percent in 1997.
Fourth-quarter results
Net income for the fourth quarter of 1998 reached $26.5 million, an
increase of 99 percent over 1997 fourth quarter net income of $13.3 million.
Net income for the 1998 fourth quarter includes a non-recurring net gain
of approximately $11.8 million from The Bank of New York's acquisition of an
80-percent interest in EVEREN Capital's EVEREN Clearing Corp. subsidiary
mentioned earlier. Excluding this one-time gain, fourth quarter net income
was $14.7 million.
Earnings per diluted common share for the fourth quarter of 1998 improved
to $.76 ($.42 excluding the one-time gain) compared with $.38 for the year-ago
period.
Net revenues, which include net interest, increased 10 percent to
$184.7 million for the quarter, from $168.1 million in the fourth quarter of
1997. Commissions improved 19 percent to $85.0 million for the fourth quarter
of 1998 from $71.1 million a year ago. Asset management revenues increased
32 percent to $27.5 million in the 1998 fourth quarter from $20.8 million the
prior year. Investment banking revenues from underwriting and advisory fees
were $15.8 million for the current quarter compared with $28.8 million a year
ago.
Net interest and dividend revenues were $13.1 million compared with
$12.7 million reported a year ago.
Non-interest expenses were $161.1 million in the current period compared
with $146.6 million for the 1997 fourth quarter. EVEREN's pretax margin for
the quarter ended December 31, 1998, excluding the one-time gain, was
12.8 percent compared with 12.8 percent for the fourth quarter of 1997 and an
after-tax margin of 7.9 percent versus 7.9 percent reported in the 1997 fourth
quarter.
Annualized return on average common equity was approximately 15.1 percent
during the fourth quarter of 1998, excluding the one-time gain.
EVEREN Capital Corporation (NYSE: EVR) is the fifth largest publicly
traded majority employee-owned company in the United States. Its principal
operating subsidiary, EVEREN Securities, Inc., ranks among the 10 largest
national full-service brokerage firms in the industry and serves individual,
corporate, municipal and institutional clients through an integrated network
of approximately 1,820 investment consultants in 170 offices. The company
combines the capital markets resources of a large national organization with
the personalized service and dedication of a smaller firm. Currently, EVEREN
holds approximately $63 billion of client assets in 619,000 active client
accounts. EVEREN Securities, Inc. is a member of the Securities Investor
Protection Corporation, the New York Stock Exchange and other principal
exchanges. For more information, visit the company's web site at
http://www.everensec.com.
Except for historical information, statements included in this release may
constitute "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. These statements involve a number
of risks, uncertainties and other factors that could cause actual results to
differ materially, as discussed in the company's filings with the Securities
and Exchange Commission.
EVEREN CAPITAL CORPORATION
AND SUBSIDIARIES
Consolidated Statements of Operations
Three months and Year ended December 31, 1998 and 1997
(unaudited)
(in thousands, except per-share data)
Three months Year
ended December 31 ended December 31
1998 1997 1998 1997
Revenues:
Commissions $84,951 $71,138 $349,088 $267,948
Principal transactions 36,143 26,789 120,982 102,892
Investment banking 15,833 28,769 85,994 69,544
Asset management 27,453 20,793 107,786 73,555
Other 7,187 7,902 37,874 30,633
Interest and dividends 23,688 22,761 107,906 85,180
Total revenues 195,255 178,152 809,630 629,752
Interest expense 10,594 10,072 54,205 36,653
Net revenues 184,661 168,080 755,425 593,099
Expenses:
Compensation and benefits 109,562 100,635 448,845 352,471
Other operating 51,550 45,922 210,667 165,639
Total non-interest expenses 161,112 146,557 659,512 518,110
Gain on sale of subsidiary 19,780 -- 19,780 --
Income before taxes 43,329 21,523 115,693 74,989
Income tax expense 16,788 8,194 44,358 28,431
Net income $26,541 $13,329 $71,335 $46,558
Net income applicable to
common shares $26,541 $13,329 $71,335 $ 46,558
Weighted average common shares
Basic 32,995 32,192 33,039 32,231
Diluted 35,083 34,896 35,426 34,447
Net income per common share
Basic $.80 $0.41 $2.16 $1.44
Diluted $.76 $0.38 $2.01 $1.35
SOURCE EVEREN Capital Corporation
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http://www.everensec.com
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http://www.prnewswire.com/comp/121760.html or fax,
800-758-5804, ext. 121760
CONTACT:
Investors, Caron L. Schreiber, 312-574-5724,
or Media, Wilson Medina, 312-574-5152, or Elise G. Powell,
312-574-5229, all of EVEREN Capital
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