JBOH record earnings up 1,300% for 99 (sweet):
siliconinvestor.com
JB Oxford Generates Record Revenues and Profitability for 1999
In First Full Year Under Current Management, Dramatic Earnings Increase Attests to Viability of Company's Operating Strategy
Highlights
* 1999 revenues of $104.2 million reflect a 55% increase over 1998
* Pretax income including one-time charge rises more than 1,300%,
to $17.2 million in 1999 from $1.2 million in 1998
* Net income including one-time charge totals $10.4 million or $0.45 per
diluted share in 1999, a dramatic improvement over the net loss
of $1.8 million, or ($0.13) per share, in 1998
* Record results include $2.3 million charge in the fourth quarter
to account for the USAO settlement and anticipated settlement
with the SEC
* USAO settlement closes door on past, enables company to focus on future
* Forbes features JB Oxford's web site among 10 online brokers named
'Best of the Web'
* Gomez Advisors names JB Oxford among top 20 in customer confidence and
relationship services
LOS ANGELES, March 7 /PRNewswire/ -- JB Oxford Holdings, Inc. (Nasdaq: JBOH), a provider of discount and online brokerage services to clients nationwide, announces record revenues and profitability for the year ended Dec. 31, 1999.
Revenues grew 55% in 1999 to $104.2 million versus $67.3 million in 1998. Pretax income increased dramatically to $17.2 million in 1999 from $1.2 million in 1998. Full-year 1999 net income, including a one-time charge of $2.3 million, totaled $10.4 million or $0.73 and $0.45 per basic and diluted share, respectively. Those figures represent a substantial improvement over the net loss of $1.8 million, or ($0.13) per share, reported in 1998.
"JB Oxford's strong revenue growth and profitability reflect the fact that the company is hitting its stride," said JB Oxford Holdings Chairman and Chief Executive Officer C.L. Jarratt. "1999 was the first full year of operations for current management. The outstanding growth and operational accomplishments we achieved are indicative of the performance we intend to deliver going forward. Our tremendous profitability -- demonstrated by the company's 17% operating margin, 10% net margin, and provides JB Oxford with the stability and staying power to effectively compete long-term."
Fourth Quarter Results
Fourth quarter 1999 revenues totaled $31.4 million, an impressive 61% increase over $19.4 million in the year-ago quarter and up 37% versus the third quarter of 1999. As a result of a significant advertising investment in the fourth quarter and one-time charges associated with the government investigations, which together totaled $11.5 million, the company reported a pretax loss of $1.2 million in the 1999 fourth quarter versus pretax income of $2.8 million in the 1998 fourth quarter. Net loss including the one-time charge for the fourth quarter of 1999 was $426,000 or ($0.03) per share, versus net income of $1.7 million or $0.12 and $0.08 per basic and diluted share, respectively, a year ago.
As announced in September, JB Oxford invested $9.2 million during the quarter in a campaign to build consumer awareness and drive customer traffic to its web site at www.jboxford.com. Then on Feb. 15, the company announced the settlement of the investigation by the U.S. Attorney's Office, resulting in a payment of $2.0 million over the next three years. In addition, management is actively negotiating with the U.S. Securities and Exchange Commission to settle that agency's ongoing investigation. The company reported a one-time charge of $2.3 million in the fourth quarter of 1999 to account for the USAO payment and in anticipation of a settlement with the SEC.
"JB Oxford's record earnings are even more impressive in light of the extraordinary expenses we incurred in the fourth quarter," said JB Oxford Holdings President and Chief Operating Officer Jamie Lewis. "Over the past 12 months, JB Oxford not only generated vigorous revenue growth but also continued to gain significant efficiencies. As a result, we were able to substantially improve the bottom-line return for shareholders while investing in the company's future."
Strategic Accomplishments
Settlement Represents a Momentous Step Forward
In February the company announced the settlement of the USAO's investigation and is actively negotiating with the SEC. While it can provide no assurances as to if or when the matter will be resolved, management is optimistic that a settlement with the SEC will be reached this year.
"The USAO settlement removes a huge distraction that affected every aspect of our business," Mr. Jarratt said. "With that issue behind us and active negotiations underway with the SEC, JB Oxford's management and employees can devote our energies where they matter most: capitalizing on the numerous opportunities available in this rapidly changing industry."
Innovative Services Secure JB Oxford's Position as an Industry Leader
JB Oxford in September unveiled its enhanced web site featuring N*POWER, the first truly integrated financial services account offering free Internet access, online trading and electronic banking. N*POWER not only continues the company's tradition of offering customers excellent value and unparalleled service, but also enhances JB Oxford's reputation as an online innovator.
Gaining recognition unprecedented in the company's history, JB Oxford's web site was distinguished in the Spring 2000 Special Internet Issue of Forbes magazine as one of only 10 brokers deemed "Best of the Web." And in the most recent survey of online brokers published by Gomez Advisors, JB Oxford was ranked among the top 20 in both relationship services and customer confidence.
Brand-Building Advertising Campaign Generates Heightened Recognition
JB Oxford's nationwide advertising campaign in the fourth quarter raised the company's profile to new heights. Prime time broadcast spots on key cable channels nationwide and all six network stations in the country's largest markets were supplemented by full-page print ads in national consumer and financial papers and magazines.
"Our strong revenue growth enables us to continue investing in targeted advertising to build awareness of JB Oxford among consumers who value personal attention at a competitive price," Mr. Lewis said. "We're currently spending about $500,000 per month on advertising. However, we will remain flexible in our approach and continually evaluate the return on our advertising investments, adjusting our budget and our strategy to maximize the effectiveness of our message as we did following our fourth-quarter ad buy."
Healthy Account Growth Provides Basis for Continued Asset Aggregation,
Revenue Expansion
As of the beginning of January 2000, JB Oxford had approximately 143,000 active funded retail accounts, a 24% increase over the 115,000 reported a year ago. Customer assets totaled $3.6 billion, up more than 50% over year-end 1998. Average assets per account increased 47% to $25,000 from $17,000 the prior year. Fourth quarter retail trades per day averaged 7,860.
"JB Oxford's account growth -- while a strong 24% per annum -- could be more robust, and over the next 12 months we will pursue strategies to drive the number higher," Mr. Lewis said. "In particular, we intend to provide additional value-added services, such as the electronic banking products we anticipate rolling out by the end of March 2000 as part of the N*POWER account, in order to appeal to an ever-widening segment of the market for financial services."
Building on 1999's Achievements
"1999 truly marks a turning point in our company's history, and the strategic objectives we achieved will provide a launch pad for growth in the year ahead," Mr. Jarratt said. "Our tremendous revenue growth reflects the company's ability to seize the enormous market opportunity before us, while our significant earnings expansion demonstrates this management's ability to build the organization profitably. We're confident that the investments in services that increase our value to customers, in advertising to build our brand, and in technology to maximize operational efficiencies will continue to generate returns for JB Oxford customers and shareholders alike."
Management will hold a conference call to discuss the company's results at 11:00 a.m. Eastern Time on Tuesday, March 7. Audio of the call is accessible to the general public on the web at www.videonewswire.com/JBOXFORD/030700 .
About JB Oxford Holdings, Inc.
JB Oxford Holdings, Inc. (Nasdaq: JBOH), through its JB Oxford & Company subsidiary, provides discount brokerage services with optional access to personal brokers, electronic banking services, and free Internet access all in one friendly place. The company's one-stop financial destination at www.jboxford.com was developed to be the easiest, most complete way for consumers to manage their money. The site features online trading, online bill payment, robust stock screening and portfolio tracking tools as well as up-to-the-minute market commentary and research from the world's leading content providers. JB Oxford has branches in New York, Miami and Los Angeles.
JB Oxford Holdings, Inc.
SELECTED STATEMENTS OF OPERATIONS
For the three months ended For the year ended
Dec. 31, Dec. 31,
1999 1998 1999 1998
Total revenues $ 31,431,701 $ 19,436,552 $104,211,781 $ 67,268,325
Income (loss)
before taxes(a) (1,171,675) 2,839,981 17,231,235 (1,317,355)
Net income
(loss)(a) $ (426,055) $ 1,690,730 $ 10,444,630 $ (1,838,606)(b)
Basic earnings
(loss) per
share $ (0.03) $ 0.12 $ 0.73 $ (0.13)
Basic shares
outstanding 14,384,186 14,141,205 14,295,751 14,127,800
Diluted earnings
(loss) per
share(c) $ (0.03) $ 0.08 $ 0.45 $ (0.13)
Diluted shares
outstanding(c) 14,384,186 23,171,824 23,902,717 14,127,800
(a) 1999 results include one-time charge of $2.3 million to account for
the USAO payment and in anticipation of a settlement with the SEC.
(b) 1998 results include a one-time, non-cash interest charge of
$2.5 million associated with the change of control transaction that
occurred in May 1998.
(c) Common stock equivalents have been excluded for the fourth quarter of
1999 and the year ended 1998, as inclusion would reduce loss per share
or be antidilutive.
This press release contains statements that are forward-looking and comments on market conditions and outlook. Any number of events may occur which would affect important factors in this analysis and materially change expectations. These factors include, but are not limited to, known and unknown risks, customer trading activity, changes in technology, shifts in competitive patterns, decisions with regard to products and services, changes in revenues and profits, and significant changes in the market environment. JB Oxford cannot assure that the SEC investigation will be settled. For a description of the foregoing and other factors, investors and others should refer to the company's filings with the SEC, including its annual report on Form 10-K for the year ended Dec. 31, 1998; its quarterly reports on Form 10-Q; and other periodic filings. JB Oxford undertakes no obligation to update the forward-looking statements contained herein to reflect changed events or circumstances after today's date.
|
