-----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, WckYtTPke10DnRX0duXsEY0jCJk/d6HhTHrnu14O5DRIFin8phHt2merW2RHZRFg QZXTO1CrSCt5m6M9N0H7Yg== 0000806085-97-000077.txt : 19970327 0000806085-97-000077.hdr.sgml : 19970327 ACCESSION NUMBER: 0000806085-97-000077 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19970324 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19970326 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: 97563331 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 LEHMAN BROTHERS HOLDINGS FIRST QUARTER 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 24, 1997 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 On March 24, 1997, Lehman Brothers Holdings Inc. (the "Registrant") issued a press release with respect to its first quarter 1997 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 1997 Earnings 99.2 Consolidated Statement of Operations (Three Months Ended February 28, 1997) (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/ Charles B. Hintz Charles B. Hintz Chief Financial Officer (Principal Financial Officer) Date: March 26, 1997 EXHIBIT INDEX Exhibit No. Exhibit Exhibit 99.1 Press Release Relating to First Quarter 1997 Earnings Exhibit 99.2 Consolidated Statement of Operations (Three Months Ended February 28, 1997) (Preliminary and Unaudited) Exhibit 99.3 Selected Statistical Information EXHIBIT 99.1 LEHMAN BROTHERS News Release ---------------------------------------------------- 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 $144 MILLION, UP 38 PERCENT FROM A YEAR AGO NEW YORK, March 24, 1997 -- Lehman Brothers Holdings Inc. (NYSE: LEH) today reported net income of $144 million, or $1.16 per common share, for the first quarter ended February 28, 1997. Net income increased by 38 percent over the $104 million reported for the first quarter of 1996. Net income per share increased by 47 percent from $0.79 in the year-ago quarter. "The first quarter results reflect continued strong progress for the Firm overall," said Richard S. Fuld, Jr., Chairman and Chief Executive Officer. "Most of the positive trends we saw in our record fourth quarter continued into this quarter. The balanced strength we have seen in the Firm's fixed income, equity, and investment banking activities over the past six months has translated into significantly improved earnings momentum and profitability for the Firm." Net revenues (total revenues less interest expense) for first quarter were $925 million, an - more - First Quarter 1997/page 2 increase of 13 percent from $821 million in the first quarter of 1996. Mr. Fuld noted that the Firm's revenue performance in the first quarter reflected continued strength in a range of businesses globally. In particular, the Firm reported gains in several strategically important, higher-margin businesses that it is focusing on in 1997 and beyond, including mergers and acquisitions, equity origination, derivatives, high yield, and emerging markets activities. Non-interest expenses for the quarter were $706 million, compared with $662 million in the 1996 first quarter. Nonpersonnel expenses in the 1997 quarter were $237 million, a decrease of 4 percent from the previous year's first quarter, reflecting the Firm's continued successful focus on expense management. Compensation and benefits as a percentage of net revenues remained at 50.7 percent for the eighth successive quarter. For the 1997 first quarter, the Firm's pre-tax margin was 23.7 percent, compared with 19.2 percent in the year-ago first quarter, and 20.9 percent for all of 1996, before taking into account the effect of a non-recurring charge in the 1996 fourth quarter. Return on common equity increased to 16.1 percent for the quarter ended February 28, 1997, compared with 12.6 percent a year ago, and 13.9 for all of 1996, before taking into account the non-recurring charge. As of February 28, 1997, Lehman Brothers stockholders' equity was $4.012 billion and total capital (stockholders' equity and long-term debt) was $21.308 billion. Book value per common share was $29.76. Lehman Brothers is a global investment bank with leadership positions in corporate finance, advisory services, municipal finance, and fixed income and equity 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. Financial Statements Attached EXHIBIT 99.2 LEHMAN BROTHERS HOLDINGS INC. Page 3 CONSOLIDATED STATEMENT OF OPERATIONS (Preliminary and Unaudited) (In millions, except per share data) Three Months Ended Percentage of February 28, February 29, Dollar Change 1997 1996 Inc/(Dec) -------------- ------------ ------------- Revenues: Principal transactions $ 346 $ 413 (16)% Investment banking 240 211 14 Commissions 97 96 1 Interest and dividends 3,278 2,656 23 Other 38 10 280 -------- ------- Total revenues 3,999 3,386 18 Interest expense 3,074 2,565 20 ------ ----- Net revenues 925 821 13 ------- ------ Non-interest expenses: Compensation and benefits 469 416 13 Brokerage, commissions and clearance fees 57 57 Professional services 41 34 21 Occupancy and equipment 35 40 (13) Communications 34 40 (15) Business development 25 27 (7) Depreciation and amortization 22 24 (8) Other 23 24 (4) -------- -------- Total non-interest expenses 706 662 7 ------- ------- Income before taxes 219 159 38 Provision for income taxes 75 55 36 -------- -------- Net income $ 144 $ 104 38 ======= ======= Net income applicable to common stock $ 138 $ 93 48 ======= ======= Average common and common equivalent shares outstanding 118.5 116.9 ===== ===== Earnings per common share $1.16 $0.79 ===== ===== EXHIBIT 99.3 Page 4 LEHMAN BROTHERS HOLDINGS INC. SELECTED STATISTICAL INFORMATION (Preliminary and Unaudited) (Dollars in millions, except per share data)
Quarters Ended Twelve Months 2/28/97 11/30/96 8/31/96 5/31/96 2/29/96 1996 Income Statement Net Revenues $ 925 $1,068 $722 $833 $821 $3,444 Non-Interest Expenses: Compensation and Benefits 469 542 366 422 416 1,747 Nonpersonnel Expenses (a) 237 247 240 242 246 976 Net Income from Operations Excluding Special Items 144 177 77 108 104 466 Special Charges (after-tax): Severance charge (50) (50) Net Income 144 127 77 108 104 416 Net Income Applicable to Common Stock 138 113 71 102 93 378 Earnings per Common Share $1.16 $0.96 $0.60 $0.89 $0.79 $3.24 Financial Ratios (%) (b) Return on Common Equity (annualized) 16.1 20.6 9.0 13.4 12.6 13.9 Pretax Operating Margin 23.7 26.1 16.0 20.2 19.2 20.9 Compensation & Benefits/ Net Revenues 50.7 50.7 50.7 50.7 50.7 50.7 Effective Tax Rate (c) 34.0 36.7 33.6 36.0 34.0 35.4 Balance Sheet Total Assets $149,000 $128,596 $125,666 $133,725 $128,702 Total Assets Excluding Matched Book (d) 114,000 96,256 90,216 89,864 84,608 Common Stockholders' Equity (e) 3,504 3,366 3,233 3,058 3,015 Total Stockholders' Equity (f) 4,012 3,874 3,741 3,566 3,523 Total Capital (long-term debt plus stockholders' equity) 21,308 19,796 17,955 17,135 16,994 Book Value per Common Share (g) 29.76 28.84 27.74 27.29 26.41 Other Data (#s) Employees 7,602 7,556 7,762 7,794 7,703 Common Stock Outstanding 101,263,173 100,449,144 100,027,645 100,398,499 102,443,232 Average Common and Common Equivalent Shares Outstanding 118,460,215 116,947,549 117,205,775 114,788,688 116,932,697 116,373,585
(a) Excludes special items of $84 million relating to severance in the twelve months and quarter ended November 30, 1996. (b) Financial ratios exclude the severance charge and the dividend on the Company's Redeemable Voting Preferred Stock. (c) The effective tax rate, including the severance charge was 34.7% and 34.9% for the twelve months and quarter ended November 30, 1996, respectively. (d) Matched book is defined as the lower of securities purchased under agreements to resell or securities sold under agreements to repurchase. (e) The increase in common stockholders' equity at 8/31/96, reflects an increase in common stock issuable due to restricted stock units granted under the Lehman Stock Award Program effective July 1. (f) In February 1996, 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 forpurposes of calculating earnings per share. (g) This calculation includes restricted stock units granted under the Lehman Stock Award Programs included in stockholders' equity. -----END PRIVACY-ENHANCED MESSAGE-----