-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, HGdHOtoES5rpJ3IHiLTTOxLqFoCSf2hg3T/13yIcjoBGxUmtbrn5aE0tCnadNKXi guHkBi7gnB7oggALQdJ9Rw== 0000950123-98-001702.txt : 19980220 0000950123-98-001702.hdr.sgml : 19980220 ACCESSION NUMBER: 0000950123-98-001702 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19980219 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19980219 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: PAINE WEBBER GROUP INC CENTRAL INDEX KEY: 0000075754 STANDARD INDUSTRIAL CLASSIFICATION: SECURITY BROKERS, DEALERS & FLOTATION COMPANIES [6211] IRS NUMBER: 132760086 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-07367 FILM NUMBER: 98545381 BUSINESS ADDRESS: STREET 1: 1285 AVE OF THE AMERICAS CITY: NEW YORK STATE: NY ZIP: 10019 BUSINESS PHONE: 2127132000 FORMER COMPANY: FORMER CONFORMED NAME: PAINE WEBBER INC DATE OF NAME CHANGE: 19840523 8-K 1 PAINE WEBBER GROUP, INC. 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ----------- FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported) February 19, 1998 -------------------- PAINE WEBBER GROUP, INC. - ------------------------------------------------------------------------------ (Exact name of registrant as specified in its charter) Delaware 1-7367 13-2760086 - ------------------------------------------------------------------------------ (State or other jurisdiction (Commission (IRS Employer of incorporation) File Number) Identification No.) 1285 Avenue of the Americas, New York, New York 10019 - ------------------------------------------------------------------------------ (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (212) 713-2000 ------------------ Not Applicable - ------------------------------------------------------------------------------ (Former name or address, if changed since last report) 2 Item 5. Other Events (a) Paine Webber Group Inc. adopted Statement of Financial Accounting Standards (SFAS) No. 128, "Earnings per Share," effective for the quarter and year-ended December 31, 1997. SFAS No. 128 requires the presentation of basic and diluted earnings per common share (EPS) in the income statement. EPS amounts for each quarter in 1997, 1996 and 1995 and for each of the six years 1992 through 1997 are filed herein on Exhibit 99(a). In addition, pro forma EPS amounts in accordance with SFAS No. 123 "Accounting and Disclosure of Stock-Based Compensation" for the years 1996 and 1995 are filed herein on Exhibit 99(a). (b) Copy of Registrant's press release which, among other things, reported financial results for 1997 and for the fourth quarter of 1997. Item 7. Financial Statements, Pro Forma Financial Information And Exhibits (c) Exhibits 99(a) EPS table for each quarter in 1997, 1996 and 1995 and for each of the six years 1992 through 1997. SFAS No. 123 pro forma EPS table for the years 1996 and 1995. 99(b) Copy of Registrant's press release which, among other things, reported results for 1997 and for the fourth quarter of 1997. 3 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. PAINE WEBBER GROUP INC. (REGISTRANT) By /s/ Regina Dolan -------------------------------- Name: Regina Dolan Title: Senior Vice President and Chief Financial Officer DATE: February 19, 1998 4 EXHIBIT INDEX Item No. Description - -------- ----------- 99(a) EPS table for each quarter in 1997, 1996, and 1995 and for each of the six years 1992 through 1997. SFAS No. 123 pro forma EPS table for the years 1996 and 1995. 99(b) Copy of Registrant's press release which, among other things, reported results for 1997 and for the fourth quarter of 1997. EX-99.A 2 EPS TABLE 1 EXHIBIT 99 (a) Paine Webber Group Inc. adopted Statement of Financial Accounting Standards (SFAS) No. 128, "Earnings per share," effective for the quarter and year-ended December 31, 1997. SFAS No. 128 requires the presentation of basic and diluted earnings per share (EPS) in the income statement. EPS amounts for each quarter in 1997, 1996 and 1995 and for each of the six years 1992 through 1997 were as follows:
1997 (1) 1996 (1) 1995 (1) -------------------------------------- -------------------------------------- -------------------------------------- 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q (2) 3Q 4Q (2) -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- ------- Basic EPS $ 0.72 $ 0.66 $ 0.78 $ 0.75 $ 0.70 $ 0.65 $ 0.56 $ 0.65 $ 0.19 $ (0.70) $ 0.51 $ 0.38 Diluted EPS $ 0.62 $ 0.58 $ 0.70 $ 0.68 $ 0.61 $ 0.56 $ 0.49 $ 0.57 $ 0.18 $ (0.70) $ 0.45 $ 0.33
(1) Earnings per share amounts have been adjusted to reflect a three-for-two common stock split which became effective on November 17, 1997. (2) Includes after-tax charges of $125.9 million ($200 million before income taxes) and $20.1 million ($30 million before income taxes) in the second and fourth quarters, respectively, related to the resolution of the issues arising from the Company's sale of public proprietary limited partnerships.
1997 (1) 1996 (1) 1995 (1)(2) 1994 (1)(3) 1993 (1) 1992 (1) -------- -------- -------- -------- -------- -------- Basic EPS $ 2.84 $ 2.55 $ 0.37 $ 0.28 $ 2.36 $ 2.10 Diluted EPS $ 2.56 $ 2.24 $ 0.35 $ 0.26 $ 1.95 $ 1.63
(1) Earnings per share amounts have been adjusted to reflect a three-for-two common stock split which became effective on November 17, 1997. (2) The 1995 results include after-tax charges of $146 million ($230 million before income taxes) related to the resolution of the issues arising from the Company's sale of public proprietary limited partnerships. (3) The 1994 results include after-tax costs of $36 million ($50 million before income taxes) and $34 million ($57 million before income taxes) related to the purchase of certain net assets and specific businesses of Kidder, Peabody Group Inc. and a non-recurring mutual fund charge, respectively. 2 The Company accounts for stock option grants in accordance with APB Opinion No. 25. Accordingly, no compensation cost has been recognized for its stock option grants. Pro forma information regarding net income and earnings per share is required under SFAS No. 123 and has been determined as if the Company had accounted for all 1996 and 1995 stock option grants based on the fair value method. The pro forma information presented below is not representative of the effect stock options will have on pro forma net income or earnings per share for future years. The pro forma information is as follows: 1996(1) 1995(1)(2) Pro Forma earnings per common share: Basic $2.49 $0.34 Diluted $2.19 $0.31 (1) Earnings per share amounts have been adjusted to reflect a three-for-two common stock split which became effective on November 17, 1997. (2) The 1995 results include after-tax charges of $146 million ($230 million before income taxes) related to the resolution of the issues arising from the Company's sale of public proprietary limited partnerships. EX-99.B 3 PRESS RELEASE 1 Exhibit 99(b) [PAINEWEBBER LOGO] Corporate Communications PaineWebber Incorporated 1285 Avenue of the Americas, 14th Fl. New York, NY 10019-6028 (212) 713-8391 - -------------------------------------------------------------------------------- NEWS RELEASE - -------------------------------------------------------------------------------- FOR IMMEDIATE RELEASE Contact: Gus Carlson Paine Webber Group Inc. 212-713-8502 PAINE WEBBER GROUP REPORTS RECORD RESULTS FOR 1997 - ANNUAL EARNINGS PER SHARE OF $2.56; NET INCOME RISES TO $415 MILLION - - FOURTH QUARTER NET INCOME UP 19 PERCENT; EPS OF 68 CENTS - NEW YORK, January 20, 1998 - Paine Webber Group Inc. reported today record financial results for 1997. Net income was $415.4 million, or $2.56 per diluted common share, for the year ended December 31, 1997, compared with $364.4 million, or $2.24 per diluted common share for 1996. Revenues, including net interest, were $4.112 billion for 1997, an increase of 10 percent from $3.735 billion the previous year. For the fourth quarter ended December 31, 1997, net income was $108.7 million, or $0.68 per diluted common share, an increase of 18.8 percent from $91.5 million, or $0.57 per diluted common share, in the corresponding period a year ago. Revenues, including net interest, were $1.070 billion, an increase of 13.8 percent from $940.0 million in the fourth quarter of 1996. Return on common equity was 22.3 percent for the quarter, compared with 21.2 percent for the year-ago period. "We are very pleased to report the fifth year of record earnings in the last seven for PaineWebber and the strongest fourth quarter in the firm's 118-year history," said Donald B. Marron, PaineWebber's chairman and chief executive officer. "Our record 1997 revenue results, which surpassed $4 billion for the first time, reflect strength across all businesses and indicate our ability to achieve our goals. The firm's strategic focus on revenue stability and critical growth objectives was particularly effective during the fourth quarter, a period of volatility in domestic and global markets. Our 1997 return on common equity of 22.4 percent reflects the translation of our performance success into strong returns for our shareholders." 2 Paine Webber Group Inc. Page 2 Among the highlights: * Assets under control, a key measure of the firm's asset gathering strategy, reached $297.1 billion at the end of 1997, a record, and an increase of 21.4 percent from $244.7 billion a year ago. * Assets under management reached $48.9 billion in 1997, a record. The asset-weighted performance of Mitchell Hutchins funds ranks among the industry leaders, with 80 percent of the assets in the top half of the Lipper rankings. * Wrap fee assets, a main component of the strategy of developing fee-based assets, grew to $21.4 billion in 1997, an increase of 45.6 percent from a year ago. * Recurring fee income, a reflection of the quality of the firm's revenue stream, reached an all-time high of $700 million in 1997, an increase of 22.6 percent from 1996. * The firm's commercial real estate and municipal securities groups achieved record results in 1997, helping PaineWebber to report record investment banking revenues for the year: The commercial real estate banking group strengthened its position as a leading underwriter of real estate investment trusts (REITs). A significant accomplishment was the group's lead management of a $700 million syndicated credit facility for Patriot American Hospitality. The municipals group ranked No. 2 in the industry for senior negotiated underwritings. For the year, total underwritings were a record $18.9 billion, an increase of 40 percent from 1996. Paine Webber Group Inc., together with its subsidiaries, serves the investment and capital needs of a worldwide client base. The firm employs 16,627 people in 299 offices. As of December 31, 1997, the book value per share was $13.80. -- Two tables to follow -- 3 PAINE WEBBER GROUP INC. QUARTERLY STATISTICAL SUPPLEMENT - OPERATING RESULTS [UNAUDITED]
4Q 97 3Q 97 2Q 97 1Q 97 4Q 96 - ----------------------------------------------------------------------------------------------------------------- ROE Common 22.3% 24.3% 20.1% 22.7% 21.2% Income Before Taxes & Minority Interest as a Percentage of Net Revenue 16.4% 16.8% 15.5% 16.7% 15.1% - ----------------------------------------------------------------------------------------------------------------- E.P.S. [diluted] $ 0.68 $ 0.70 $ 0.58 $ 0.62 $ 0.57 Diluted Shares [Millions] 150.9 152.1 151.7 153.2 152.1 Dividends Paid Per Common Share $ 0.11 $ 0.10 $ 0.10 $ 0.10 $ 0.08 Book Value Per Common Share $ 13.80 $ 13.28 $ 13.03 $ 12.61 $ 12.19 Common Shares Outstanding [Millions] 139.9 132.3 137.2 137.5 139.5 - ----------------------------------------------------------------------------------------------------------------- Total Capital [$Billions] $ 5.91 $ 5.73 $ 5.49 $ 5.34 $ 4.90 Total Shareholders' Equity [$Billions] $ 1.93 $ 1.86 $ 1.84 $ 1.78 $ 1.73 - ----------------------------------------------------------------------------------------------------------------- Assets Under Control [$Billions] $ 297.1 $ 288.6 $ 269.7 $ 248.4 $ 244.7 Assets Under Management [$Billions] $ 48.9 $ 48.1 $ 45.1 $ 44.6 $ 44.8 Money Market Funds 25.9 25.6 24.2 24.6 22.9 Long Term Mutual Funds 11.3 11.1 10.2 9.4 9.4 Institutional and Other 11.7 11.4 10.7 10.6 12.5 Wrap Fee Assets [$Billions] $ 21.4 $ 20.5 $ 18.0 $ 15.5 $ 14.7 - ----------------------------------------------------------------------------------------------------------------- Recurring Fees (YTD Annualized) $ 700 $ 665 $ 637 $ 632 $ 571 [$Millions] Recurring Fees (Incl. Margin Interest) - As a % of Fixed Costs 84% 80% 74% 74% 73% - ----------------------------------------------------------------------------------------------------------------- Employees 16,627 16,437 16,105 15,910 15,870 Investment Executives 6,249 6,140 6,076 6,065 6,095 Sales Offices 299 299 298 300 298
4 PAINE WEBBER GROUP INC. CONSOLIDATED STATEMENTS OF INCOME (IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS) (UNAUDITED)
Quarter Ended December 31, Year Ended December 31, 1997 1996 1997 1996 ------------------------- ------------------------- REVENUES Commissions $ 392,284 $ 344,422 $1,496,791 $1,381,475 Principal Transactions 254,611 235,130 1,055,648 1,023,615 Asset Management 154,753 118,606 542,755 453,267 Investment Banking 122,875 113,947 460,001 391,164 Interest 786,469 624,206 2,963,124 2,309,737 Other 34,044 33,217 138,633 146,708 ---------- ---------- ---------- ---------- TOTAL REVENUES 1,745,036 1,469,528 6,656,952 5,705,966 Interest Expense 675,351 529,560 2,544,550 1,970,754 ---------- ---------- ---------- ---------- NET REVENUES 1,069,685 939,968 4,112,402 3,735,212 ---------- ---------- ---------- ---------- NON-INTEREST EXPENSES Compensation and Benefits 631,935 558,836 2,420,296 2,219,129 Office & Equipment 69,367 66,251 275,532 267,006 Communications 39,233 37,064 153,285 153,301 Business Development 23,115 20,760 82,099 75,981 Brokerage, Clearing & Exchange Fees 20,678 21,965 86,808 87,839 Professional Services 37,143 30,060 129,066 108,123 Other Expenses 72,910 63,256 292,209 263,800 ---------- ---------- ---------- ---------- TOTAL NON-INTEREST EXPENSES 894,381 798,192 3,439,295 3,175,179 ---------- ---------- ---------- ----------
5 INCOME BEFORE INCOME TAXES & MINORITY INTEREST 175,304 141,776 673,107 560,033 Provision for Income Taxes 58,535 49,260 228,626 194,649 ------------ ------------ ------------ ------------ INCOME BEFORE MINORITY INTEREST 116,769 92,516 444,481 365,384 Minority Interest 8,061 1,034 29,032 1,034 ------------ ------------ ------------ ------------ NET INCOME $ 108,708 $ 91,482 $ 415,449 $ 364,350 ============ ============ ============ ============ NET INCOME APPLICABLE TO COMMON SHARES $ 101,330 $ 84,133 $ 385,936 $ 334,955 EARNINGS PER SHARE BASIC $ 0.75 $ 0.65 $ 2.84 $ 2.55 DILUTED $ 0.68 $ 0.57 $ 2.56 $ 2.24 WEIGHTED AVERAGE COMMON SHARES BASIC 134,559,000 128,502,000 135,943,000 131,547,000 DILUTED 150,925,000 152,051,000 153,348,000 153,830,000
* Basic and diluted earnings per share are presented in accordance with SFAS No. 128, reflecting a three for two common stock split in the form of a 50% stock dividend, paid November 17, 1997 to shareholders of record on October 24, 1997. -----END PRIVACY-ENHANCED MESSAGE-----