-----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, U4DyEYi1z0OndK0QLwrgbcAxuwyHxX8VJnMtRJcjrFg4osNXJ+xZChgcDj4HchJ/ DapdGaO8ECuK3FeWefAiRQ== 0000806085-96-000029.txt : 19960325 0000806085-96-000029.hdr.sgml : 19960325 ACCESSION NUMBER: 0000806085-96-000029 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19960320 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19960322 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: LEHMAN BROTHERS HOLDINGS INC CENTRAL INDEX KEY: 0000806085 STANDARD INDUSTRIAL CLASSIFICATION: SECURITY BROKERS, DEALERS & FLOTATION COMPANIES [6211] IRS NUMBER: 133216325 STATE OF INCORPORATION: DE FISCAL YEAR END: 1130 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-09466 FILM NUMBER: 96537323 BUSINESS ADDRESS: STREET 1: AMERICAN EXPRESS TWR STREET 2: 3 WORLD FINANCIAL CNTR CITY: NEW YORK STATE: NY ZIP: 10048 BUSINESS PHONE: 2125267000 MAIL ADDRESS: STREET 1: AMERICAN EXPRESS TOWER 15TH FL STREET 2: 2 WORLD TRADE CENTER CITY: NEW YORK STATE: NY ZIP: 10048 FORMER COMPANY: FORMER CONFORMED NAME: SHEARSON LEHMAN HUTTON HOLDINGS INC DATE OF NAME CHANGE: 19901017 8-K 1 TEST 8-K 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): March 20, 1996 LEHMAN BROTHERS HOLDINGS INC. (Exact name of registrant as specified in its charter) Delaware (State or other jurisdiction of incorporation) 1-9466 13-3216325 (Commission File Number) (IRS Employer Identification No.) 3 World Financial Center New York, New York 10285 (Address of principal (Zip Code) executive offices) Registrant's telephone number, including area code: (212) 526-7000 Item 5. Other Events First Quarter Earnings On March 20, 1996, Lehman Brothers Holdings Inc. (the "Registrant") issued a press release with respect to its first quarter 1996 earnings (the "Earnings Release"). Copy of the Earnings Release follows. Item 7. Financial Statements and Exhibits (c) Exhibits The following Exhibits are filed as part of this Report. 99.1 Press Release Relating to First Quarter 1996 Earnings 99.2 Consolidated Statement of Operations (Three Months Ended February 29, 1996) (Preliminary and Unaudited) 99.3 Selected Statistical Information The Exhibit Index to this Report is incorporated herein by reference. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized. LEHMAN BROTHERS HOLDINGS INC. By:/s/ Robert Matza Robert Matza Chief Financial Officer (Principal Financial Officer) Date: March 22, 1996 EXHIBIT INDEX Exhibit No. Exhibit Exhibit 99.1 Press Release Relating to First Quarter 1996 Earnings Exhibit 99.2 Consolidated Statement of Operations (Three Months Ended February 29, 1996) (Preliminary and Unaudited) Exhibit 99.3 Selected Statistical Information EXHIBIT 99.1 For Immediate Release MEDIA CONTACT: William J. Ahearn (212) 526-4379 INVESTOR CONTACT: Shaun Butler (212) 526-8381 LEHMAN BROTHERS REPORTS FIRST QUARTER EARNINGS OF $104 MILLION, UP 131 PERCENT FROM A YEAR AGO NEW YORK, March 20, 1996 Lehman Brothers Holdings Inc. (NYSE: LEH) today reported net income of $104 million, or $0.79 per common share, for the first quarter ended February 29, 1996. Net income increased by 131 percent over the $45 million reported for the first quarter of 1995, and by 30 percent over the $80 million of net income from operations reported for the fourth quarter of 1995. (Operating earnings in the 1995 fourth quarter do not reflect the impact of two special items.) Net income per share increased by 155 percent from $0.31 in the year-ago quarter, and by 61 percent from $0.49 in the 1995 fourth quarter. "The first quarter results reflect continued positive momentum across the board for Lehman Brothers," said Richard S. Fuld, Jr., Chairman and Chief Executive Officer. "Stronger earnings and enhanced margins were driven by the fourth consecutive quarter of higher revenues and lower expenses, amid a period of generally improved market conditions. We are encouraged with our continued financial progress, as it underscores the success of our client- and customer-driven strategy and our focus on effectively enhancing revenues and improving productivity. Additionally, our ongoing expense management efforts resulted in another quarter- over-quarter reduction in nonpersonnel expenses, even as revenues rose significantly." Net revenues (total revenues less interest expense) for the first quarter were $821 million, an increase of 16 percent from $707 million in the first quarter of 1995 and nine percent from $755 million in the fourth quarter of 1995, excluding a special item. The increase in net revenues reflects continued strengthening in a number of fixed income and equity areas throughout the Firm, particularly mortgages, equity derivatives, and both high yield and high grade corporate bonds. Mr. Fuld noted that the Firm's revenue performance in the first quarter was strong even though investment banking revenues -- while well above the first quarter of 1995 -- were somewhat below the pace of the 1995 fourth quarter, due in large part to the timing of certain corporate finance advisory fees. The Firm entered the 1996 first quarter with a backlog of $37 billion in M&A transactions; at the end of the first quarter, the aggregate dollar value of transactions in the pipeline had increased to $58 billion. Non-interest expenses for the quarter were $662 million. Nonpersonnel expenses for the same period were $246 million, a decrease of 11 percent from the previous year's first quarter, and of three percent from the fourth quarter of 1995, excluding special items. At the end of the 1996 first quarter, the Firm's headcount totaled 7,703 versus a peak of 9,400 employees reached during the first quarter of 1994. Compensation and benefits as a percentage of net revenues remained at 50.7 percent for the fourth successive quarter. "The decline in nonpersonnel costs underscores that our Firmwide effort to reduce expenses is no longer a special program, but a way of doing business," Mr. Fuld said. "As a reflection of our progressively stronger revenue momentum, in combination with our success at expense management, the Firm's pre-tax margin has grown approximately 15 percentage points above its low in the third quarter of 1994." For the 1996 first quarter, the Firm's pre-tax margin was 19.2 percent, compared with 9.9 percent in the first quarter of 1995, and 15.6 percent in the 1995 fourth quarter. Return on common equity increased to 12.6 percent for the quarter ended February 29, 1996, compared with 5.1 percent for the first quarter of 1995, and 9.3 percent for the 1995 fourth quarter. As of February 29, 1996, Lehman Brothers stockholders' equity was $3.5 billion and total capital (stockholders' equity and long- term debt) was $17 billion. Book value per common share was $26.41. Lehman Brothers is a global investment bank with leadership positions in corporate finance, advisory services, municipal finance and securities sales, trading and research. Lehman Brothers serves the financial needs of corporate, government and institutional clients, and high-net-worth individuals through offices in major financial centers worldwide. EXHIBIT 99.2 Three Months Ended Percentage of February 29, February 28, Dollar Change 1996 1995 Inc/(Dec) Revenues: Principal transactions $ 413 $ 359 15% Investment banking 211 137 54 Commissions 96 105 (9) Interest and dividends 3,187 2,501 27 Other 10 10 Total revenues 3,917 3,112 26 Interest expense 3,096 2,405 29 Net revenues 821 707 16 Non-interest expenses: Compensation and benefits 416 360 16 Brokerage, commissions 57 64 (11) and clearance fees Communications 40 47 (15) Occupancy and equipment 40 45 (11) Professional services 34 42 (19) Business development 27 29 (7) Depreciation and amortization 24 27 (11) Other 24 23 4 Total non-interest expenses 662 637 4 Income before taxes 159 70 127 Provision for income taxes 55 25 120 Net income $ 104 $ 45 131 Net income applicable $ 93 $ 34 174 to common stock Average common and common equivalent shares outstanding 116.9 110.2 Earnings per common share $0.79 $0.31
LEHMAN BROTHERS HOLDINGS INC. CONSOLIDATED STATEMENT OF OPERATIONS (Preliminary and Unaudited) (In millions, except per share data)
EXHIBIT 99.3 Twelve Quarters Ended Months 2/29/96 11/30/95(a) 8/31/95 5/31/95 2/28/95 1995(a) Income Statement Net Revenues $821 $755 $750 $731 $707 $2,942 Non-Interest Expenses: Compensation and 416 383 380 371 360 1,494 Benefits Nonpersonnel 246 254 261 270 277 1,061 Expenses(b) Net Income from Operations Excluding Special Items 104 69 71 58 45 253 Net After-Tax Gain from Sale of Omnitel 47 47 Special Charges (after-tax): Restructuring Charge (58) (58) Net Income 104 69 71 58 45 242 Net Income Applicable to Common Stock 93 58 60 48 34 200 Earnings per Common $0.79 $0.49 $0.52 $0.43 $0.31 $1.76 Share Financial Ratios(%)(c) Return on Common Equity (annualized) 12.6 9.3 8.5 7.0 5.1 7.5 Pretax Operating 19.2 15.6 14.5 12.3 9.9 13.2 Margin Compensation & Benefits/ Net Revenues(d) 50.7 50.7 50.7 50.7 50.9 50.8 Effective Tax Rate(e) 34.0 32.5 35.0 35.5 35.8 34.5 Balance Sheet Total Assets $129,000 $115,303 $117,518 $123,421 $127,304 Total Assets Excluding Matched Book(f) 85,000 79,069 80,345 83,115 85,257 Common Stockholders' 3,015 2,990 2,923 2,767 2,718 Equity Total Stockholders' 3,523 3,698 3,631 3,475 3,426 Equity(g) Total Capital (long- term debt plus stockholders' equity) 16,994 16,463 16,528 16,257 14,603 Book Value per 26.41 25.67 25.23 25.16 24.69 Common Share(h) Other Data (#s) Employees 7,703 7,771 8,069 8,195 8,428 Common Stock 102,443,232 104,565,875 104,558,121 104,524,685 104,494,667 Outstanding Average Common and Common Equivalent Shares Outstand- ing 116,932,697 117,090,034 116,157,865 110,248,747 110,190,669 113,414,684
LEHMAN BROTHERS HOLDINGS INC. SELECTED STATISTICAL INFORMATION (Preliminary and Unaudited) (Dollars in millions, except per share data)
(a) Net revenues and non-interest expenses exclude the effects of the sale of Omnitel. (b) Excludes special items of $97 million relating to real estate-and occupancy-related expenses and severance payments in the twelve months of 1995 and the quarter ended November 30, 1995. (c) Financial ratios exclude special items and Omnitel. (d) The actual Compensation & Benefits/Net Revenues ratios, including gross proceeds and the $50 million expense related to the sale of Omnitel, were 50.3% and 49.0% for the twelve months of 1995 and the quarter ended November 30, 1995, respectively. (e) The actual tax rates, including the effects of the sale of Omnitel and the restructuring charge, were 34.3% and 31.3% for the twelve months of 1995 and the quarter ended November 30, 1995, respectively. (f) Matched book is defined as securities purchased under agreements to resell. (g) In February the Company repurchased the $200 million 8.44% Cumulative Preferred Stock owned by American Express with the proceeds from the issuance of $200 million of Quarterly Income Capital Securities Series A Subordinated Debentures with an interest rate of 8.3% maturing in 2035. The repurchase of the Preferred Stock included a premium of $2 million over the par value, which represents a one-time decrease in income available to common shareholders for purposes of calculating earnings per share. (h) This calculation includes restricted stock units granted under the Lehman Stock Award Programs included in stockholders' equity. -----END PRIVACY-ENHANCED MESSAGE-----