RYE BROOK, N.Y., April 16, 2002 (PRIMEZONE) -- Hoenig Group Inc. (Nasdaq:HOEN) today reported financial results for the three-month period ended March 31, 2002.
Three Months Ended March 31, 2002
Operating revenues for the three months ended March 31, 2002 increased 7.6% to $26.4 million from $24.5 million during the same period in 2001. Global brokerage revenues increased 11.4% to $25.0 million for the first quarter 2002 from $22.4 million during the same period in 2001. The Company's domestic brokerage revenues increased 8.1% to $21.3 million in the first quarter 2002, as compared to $19.7 million during the same period in 2001. International brokerage operating revenues increased 35.0% to $3.7 million in the first quarter 2002, as compared to $2.7 million during the same period in 2001. Investment management fees for the quarter ended March 31, 2002 decreased 33.6% to $1.4 million, as compared to $2.1 million in the first quarter 2001.
Operating income for the quarter ended March 31, 2002 decreased 15.6% to $1.4 million, as compared to $1.6 million during 2001, primarily due to a 57.5% decline in operating income from the Company's asset management operations. This decrease offset a 1.3% increase in global brokerage operating income to $2.1 million in 2002.
Net investment income and other was $4.9 million during the first quarter ended March 31, 2002 and includes $4.6 million in gains recognized on certain sales of assets of Axe-Houghton Associates, Inc., the Company's asset management subsidiary, that were completed during the quarter. The Company had a net investment loss of $7.6 million during the first quarter 2001 due to the first quarter 2001 pre-tax write-off of $9.2 million relating to the Company's investment in InstiPro Group, Inc. Net investment income for the first quarter ended March 31, 2002 before the gains on the Axe-Houghton sales was $0.3 million, as compared to net investment income before the InstiPro Group write-off of $1.7 million in the first quarter 2001.
The Company previously announced that it had agreed to sell Axe-Houghton's investment management businesses in three separate transactions. The first transaction was completed on January 31, 2002 and involved the sale Axe-Houghton's Core International ADR and Domestic Equity Index institutional investment management businesses to The Bank of New York. The second transaction was completed on March 28, 2002 and involved the sale of Axe-Houghton's Value and Balanced Equity institutional investment management businesses to Byram Capital Management LLC. The third transaction involves the sale of all of the stock of Axe-Houghton, together with the remaining small capitalization growth equity institutional investment management business. This sale is expected to be completed by April 30, 2002, subject to the receipt of client consents and satisfaction of customary closing conditions.
Net income for the first quarter 2002 was $3.7 million, as compared to a net loss of $3.5 million during the same period in 2001, due to the $2.7 million (net of tax) gains resulting from the Axe-Houghton sales completed during the quarter. Net income for the first quarter 2002 excluding the Axe-Houghton gains was $1.0 million, as compared to $2.0 million during the first quarter 2001 excluding the InstiPro write-off of $5.5 million (net of tax).
The Company's basic earnings per share for the first quarter ended March 31, 2002 increased to $0.47 from a loss per share of $0.44 during the same period in 2001, and diluted earnings per share increased to $0.41 per share from a loss per share of $0.44 during the same period in 2001. Excluding the first quarter 2002 gains of the Axe-Houghton asset sales and the 2001 InstiPro Group write-off, the Company's basic earnings per share was $0.13 and the diluted earnings per share was $0.11 for the first quarter ended March 31, 2002, as compared to adjusted earnings per share of $0.25 basic and $0.22 diluted during the first quarter 2001.
At March 31, 2002, the Company had cash, U.S. government obligations, net accounts receivables and other investments of $59.1 million, as compared to $63.9 million as of December 31, 2001.
For over thirty years, Hoenig Group Inc. has provided high-quality trade execution, independent research and premier client service to professional money managers and alternative investment funds throughout the world. Hoenig Group Inc. operates through its brokerage subsidiaries in the United States, United Kingdom and Hong Kong. Hoenig Group's U.S. asset management subsidiary, Axe-Houghton Associates, Inc., the remainder of which is in the process of being sold, provides investment management services to public and corporate employee benefit plans, investment partnerships and other institutional investors.
This press release contains forward-looking statements that relate to future plans, events and performance. These forward-looking statements involve risks and uncertainties. These risks and uncertainties are set forth in the Company's periodic reports and other filings with the Securities and Exchange Commission. Forward-looking statements reflect the Company's current views with respect to future events. Actual events and results may vary materially and adversely from those anticipated, believed, estimated or otherwise indicated.
Financial Data Three Months Ended March 31,
2002(a) 2001(b)
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Operating Revenues $ 26,363,971 $ 24,499,192
Operating Income 1,365,685 1,617,357
Net Investment Income (Loss) and
Other 4,875,697 (7,592,034)
Income (Loss) before
Income Taxes 6,241,382 (5,974,677)
Net Income(Loss) 3,685,997 (3,471,229)
Earnings (Loss) Per Share
Basic 0.47 (0.44)
Diluted 0.41 (0.44)
Weighted average
shares - Basic 7,904,278 7,906,795
Weighted average
shares - diluted 9,002,470 7,906,795
(a) Financial data for the first quarter ended March 31, 2002
excluding the $4.6 million ($2.7 million net of tax) gain on the Axe
Houghton sales completed during the quarter would be as follows: net
investment income of $261,236, income before income taxes of
$1,626,921, net income of $993,218, basic earnings per share of
$0.13, and diluted earnings per share of $0.11.
(b) Financial data for the quarter ended March 2001 excluding the
$9.2 million ($5.5 million net of tax) impairment write-off of the
Company's investment in InstiPro Group, Inc. would be as follows: net
investment income of $1,700,373, income before income taxes of
$3,317,730, net income of $2,008,771, basic earnings per share of
$0.25, and diluted earnings per share of $0.22.