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2011 Earnings: Raymond James’ Private-Client Results Rise 19%

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Raymond James Financial said Wednesday that net income in their fiscal second quarter ending March 31 rose 45% to $80.9 million, or $0.64 per share, from $55.6 million, or $0.45 per share, in the year-ago period. Net revenue totaled $852.1 million, a 16% jump over the same period last year.

Both results surpassed estimates made by analysts, who had expected Raymond James to earn $0.62 and produce sales of $824.5 million.

“This qPaul Reilly, CEO of Raymond Jamesuarter’s record net revenue, assets under administration and assets under management demonstrate the underlying strength of the firm through this economic recovery,” said CEO Paul Reilly (right) in a press release.

“Net revenue was 5% higher and net income 1% lower than the previous quarter. Although net income was down slightly, it was in line with our expectations given positive adjustments during the first quarter,” added Reilly.

Private-Client Results

According to Reilly, the private client group “led this quarter’s growth with assets under administration reaching a record $275 billion.” Assets under management grew to $35.6 billion, due to both market appreciation and net inflows, from $29.3 billion a year ago and $33.4 in the previous quarter.

PCG sales increased 19% from last year to $556.6 million in the quarter ending March 31 and also jumped 7% from last quarter.

The number of U.S. financial advisors stood at 4,472 as of March 31. Including FAs in the United Kingdom, 151, and Canada, 443, Raymond James has 5,066 advisors.

In the United States, its FA headcount dropped by 59 from last year and 19 from the previous quarter. Overall, the size of its global FA force dropped by 42 from last year and declined 14 from last quarter.  

Average production, or fees and commission per financial advisor, stood about $440,000 on a trailing-12-month basis for this quarter. For the first six months of the company’s fiscal year, average production is roughly $425,000.

Average assets under administration per FA is about $54 million, based on this quarter’s results. For the first six months of Raymond James’ current fiscal year, this figure is about $53 million.

Capital Markets

Raymond James says its capital-markets division had “another strong quarter,” according to Reilly. The number of lead managed deals was up slightly from last quarter, though underwriting revenue was down due to smaller deal participations. M&A revenue made up the shortfall, Reilly said.

Fixed-income commissions were down, but “fixed-income produced solid results due to strong trading profits in the municipal area,” he explained in a statement.

“Our business results continue to improve, and we are well-positioned to continue our growth and expansion,” added Reilly. 

For more information on earnings read AdvisorOne’s 2011 Q1 Earnings Calendar for the Financial Sector.