STOCKHOLM, Sweden, Oct. 16, 2002 (PRIMEZONE) -- The net profit for Carnegie's first three quarters 2002 was SEK 179 million (SEK 437 million), down 59 per cent from the same period last year. The result includes redundancy costs of about SEK 56 million, of which SEK 50 million in the third quarter.
The net profit for the third quarter was SEK 37 million, down 53 per cent from the third quarter of 2001 and down 30 per cent from the second quarter 2002. The net profit for the third quarter excluding redundancy costs was SEK 54 million(1), which is in line with the net profit for the second quarter 2002.
Earnings per share were SEK 0.55 for the third quarter of 2002 (SEK 1.17) and SEK 2.69 for the first nine months of 2002 (SEK 6.75). Return on equity for the last 12-month period was 20 per cent. Carnegie has confirmed its position as the leading Nordic investment bank during the first nine months of the year. Carnegie is number one in 2002 in terms of trading volume on the Nordic stock exchanges, has received top rankings in equity research, is among the top three in Nordic M&A-advisory ranking(1), and holds a 5-star ranking(2) for funds representing about 75 per cent of the assets under management in equity mutual funds.
Total income for the first nine months 2002 was SEK 1,796 million, down 31 per cent from the same period last year. The Q3(02) Y/Y drop was 21 per cent and the drop from Q2(02) was 7 per cent. Income from Securities was down 35 per cent, Investment Banking was down 51 per cent and Asset Management & Private Banking was down 6 per cent from the first nine months of 2001.
Total expenses for the first nine months were SEK 1,544 million, down 16 per cent from the same period last year, reflecting total operating expenses excluding bonus increasing by 6 per cent (up 1 per cent excluding the effect of the redundancy costs), and bonus expenses declining by 63 per cent.
As a consequence of the increased focus on cost-efficiency, the number of employees has been reduced by 80 during 2002. The net decrease from year-end is 53 employees, leading to a total number of employees of 890 at 30 September. Because of the prevailing market situation, a further staff reduction by approximately 30 employees is expected during the rest of the year.
Assets under management declined by SEK 22 billion from year-end to SEK 51 billion at September 30, 2002, in total reflecting a continued decline in asset valuations.
During the period, the Board of D. Carnegie & Co AB decided to make changes in the leadership of the company, with effect from the ordinary shareholders' meeting, planned to be held on March 13, 2003. Lars Bertmar, Chief Executive Officer of Carnegie since 1990, will be proposed as Executive chairman of the Board and Karin Forseke, will be appointed Chief Executive Officer.
(1) Thomson Financial Securities Data, October 2002.(2) Morningstar, September 2002.
Quotations from Lars Bertmar, CEO: "The equity markets have been severely hit during 2002 and the downward trend continued during the third quarter. This has caused substantially lower income in our Securities and Investment Banking income. Despite these markets, however, our income from Asset Management & Private Banking was relatively stable.
"In these markets, we have continued to improve our market positions, and we are pleased to have received several illustrations on this in all business areas. This is in line with our firm commitment to focus on serving our clients the best we can also in difficult markets.
"We have also continued our efforts to improve our cost efficiency. On this background we have been forced to reduce our staff by 80 individuals so far this year, i.e. slightly more than what was envisaged at our half-year report. Because of the prevailing market situation, we expect to further reduce our staff by approximately 30 employees during the rest of the year. After that point, assuming no further deterioration in the markets, we see no need for further reduction."
To view the full-text of this release, including tables, please click the link: http://reports.huginonline.com/876831/108858.pdf
Teleconference
A teleconference to discuss Carnegie's Q3-report will be held on October 16, at 4:00 PM (CET). The teleconference will be open to the public. In order to participate, please call 44 (0)20 8401 1043. The conference call will also be accessible as an audio live web cast (including slide presentation) at www.carnegie.se/ir. For those unable to listen to the live web cast, a replay will be available at www.carnegie.se/ir approximately one hour after the event.