BOCA RATON, Fla., Aug. 15, 2011 /PRNewswire/ -- Summit Financial Services Group, Inc. (OTC Bulletin Board: SFNS) announced financial results for the three- and six-month periods ended June 30, 2011. For the three-month period ended June 30, 2011 (the "2011 Quarter"), the Company reported revenues of approximately $16.5 million, which represented an increase of approximately $1.3 million, or approximately 8.0%, from the approximately $15.2 million in revenues reported for the three-month period ended June 30, 2010 (the "2010 Quarter"). For the 2011 Quarter, the Company reported net income of approximately $617,000, or an increase of approximately 109% from net income of approximately $295,000 reported for the 2010 Quarter.
For the six-month period ended June 30, 2011 (the "2011 Period"), the Company reported revenues of approximately $33.6 million, which represented an increase of approximately $3.3 million, or approximately 11%, from the approximately $30.3 million in revenues reported for the six months ended June 30, 2010 (the "2010 Period"). For the 2011 Period, the Company reported net income of approximately $954,000, compared with approximately $159,000 reported for the 2010 Period.
"Although the financial markets have fluctuated greatly," stated Marshall Leeds, the Company's Chairman, Chief Executive Officer and President, "we have continued to enjoy growth in revenue in 2011 when compared with 2010 due primarily to our success in recruiting the finest advisors in the industry. Further, we are pleased to report both higher net income and EBITDA for each of the three- and six-month periods. For the three-month period, the Company generated EBITDA of approximately $1.13 million, as adjusted, and approximately $2.15 million, as adjusted, for the six-month period." Mr. Leeds continued: "We know that without the hard work and dedication of our financial advisors, their staffs and our home office associates, these accomplishments would not be possible."
The Company is a Florida-based financial services holding company that provides, through its operating subsidiary, Summit Brokerage Services, Inc. ("Summit Brokerage"), a broad range of securities brokerage and investment services to primarily individual investors. Summit Brokerage also sells insurance products, predominantly fixed and variable annuities and life insurance through its subsidiary, SBS Insurance Agency of Florida. Summit Brokerage also provides asset management services through its investment advisor, Summit Financial Group, Inc.
Summit Brokerage is registered with the Securities and Exchange Commission (SEC), and is a member of FINRA (f/k/a NASD), the Municipal Securities Rule Making Board, and the National Futures Association. The Company currently offers its services through a network of approximately 300 registered representatives, and its business plan is focused primarily on increasing its network of affiliated registered representatives through recruitment as well as by acquisitions.
The following table presents a reconciliation of EBITDA, as adjusted, to net income as reported:
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||
2011 | 2010 | 2011 | 2010 | ||||||||
Net Income as reported | $ | 616,509 | $ | 294,949 | $ | 953,637 | $ | 159,069 | |||
Add: | Depreciation | 40,756 | 43,753 | 85,679 | 92,428 | ||||||
Amortization – notes | 58,022 | 104,483 | 137,142 | 220,393 | |||||||
Non-cash compensation | 104,280 | 131,332 | 401,534 | 585,835 | |||||||
Income tax expense | 307,411 | 192,520 | 570,380 | 335,520 | |||||||
$ | 1,126,978 | $ | 767,037 | $ | 2,148,372 | $ | 1,393,245 | ||||
Earnings before interest, taxes, depreciation and amortization, or EBITDA, adjusted for non-cash compensation expense is a key metric the Company uses in evaluating its financial performance. EBITDA is considered a non-GAAP financial measure as defined by Regulation G, promulgated by the SEC under the Securities Act of 1933, as amended. The Company considers EBITDA, as adjusted, important in monitoring and evaluating its financial performance on a consistent basis across various periods, as well as for purposes of, analyzing and evaluating financial and strategic planning decisions regarding future operating investments and potential acquisitions. The Company believes that EBITDA, as adjusted, eliminates items that are not part of its core operations, or do not involve a cash outlay, such as stock-related compensation. EBITDA, as adjusted, should be considered in addition to, rather than as a substitute for, pre-tax income, net income and cash flows from operating activities.
Summit Financial Services Group, Inc. Condensed Consolidated Statements of Income Quarter Ended June 30, 2011 | ||||||||
For The Three Months Ended June 30, | ||||||||
2011 | 2010 | |||||||
(Unaudited) | (Unaudited) | |||||||
Revenues | ||||||||
Commissions | $ | 15,843,796 | $ | 14,631,425 | ||||
Interest and dividends | 274,262 | 355,887 | ||||||
Other | 383,658 | 233,788 | ||||||
16,501,716 | 15,221,100 | |||||||
Expenses | ||||||||
Commissions and clearing costs | 13,274,126 | 12,504,508 | ||||||
Employee compensation and benefits | 1,538,594 | 1,438,533 | ||||||
Occupancy and equipment | 185,502 | 195,830 | ||||||
Communications | 117,453 | 69,164 | ||||||
Depreciation and amortization | 40,756 | 43,753 | ||||||
Other operating expenses | 421,365 | 481,843 | ||||||
15,577,796 | 14,733,631 | |||||||
Income before income taxes | 923,920 | 487,469 | ||||||
Provision for income taxes | 307,411 | 192,520 | ||||||
Net income | $ | 616,509 | $ | 294,949 | ||||
Basic income per common share | $ | 0.02 | $ | 0.01 | ||||
Diluted income per common share | $ | 0.02 | $ | 0.01 | ||||
Weighted average common shares outstanding: | ||||||||
Basic | 26,877,131 | 25,920,288 | ||||||
Diluted | 31,265,999 | 30,247,462 | ||||||
Summit Financial Services Group, Inc. Condensed Consolidated Statements of Income Six Months Ended June 30, 2011 | |||||||||
For the Six Months Ended June 30, | |||||||||
2011 | 2010 | ||||||||
(Unaudited) | (Unaudited) | ||||||||
Revenues | |||||||||
Commissions | $ | 32,307,614 | $ | 29,151,542 | |||||
Interest and dividends | 564,448 | 694,982 | |||||||
Other | 727,186 | 433,835 | |||||||
33,599,248 | 30,280,359 | ||||||||
Expenses | |||||||||
Commissions and clearing costs | 27,173,907 | 24,995,101 | |||||||
Employee compensation and benefits | 3,302,728 | 3,157,792 | |||||||
Occupancy and equipment | 351,698 | 410,685 | |||||||
Communications | 195,763 | 171,693 | |||||||
Depreciation and amortization | 85,679 | 92,428 | |||||||
Other operating expenses | 965,456 | 958,071 | |||||||
32,075,231 | 29,785,770 | ||||||||
Income before income taxes | 1,524,017 | 494,589 | |||||||
Provision for income taxes | 570,380 | 335,520 | |||||||
Net income | $ | 953,637 | $ | 159,069 | |||||
Basic income per common share | $ | 0.04 | $ | 0.01 | |||||
Diluted income per common share | $ | 0.03 | $ | 0.01 | |||||
Weighted average common shares outstanding: | |||||||||
Basic | 26,843,403 | 25,834,100 | |||||||
Diluted | 31,655,572 | 28,882,954 | |||||||
"Forward-looking" Statements
This press release may contain "forward-looking" statements, as defined in the Private Securities Litigation Reform Act of 1995, as amended. Any such statements are made pursuant to the safe-harbor provisions of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended, and they involve a number of risks and uncertainties that could cause actual results to differ materially from those that may be anticipated by or from the forward-looking statements. Important factors that could cause such a difference are set forth in the Company's filings with the Securities and Exchange Commission and include, but are not limited to, investor confidence and the performance of the securities markets, and the availability of suitable candidates for the Company's acquisition or recruitment.
SOURCE Summit Financial Services Group, Inc.
