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Piper Jaffray Q1 Profit Down 57% - Update

Investment bank and asset management firm Piper Jaffray Companies (PJC) on Wednesday reported a profit for the first quarter that dropped 57 percent from last year. The results reflecting lower revenues at both its capital markets as well as asset management segments, and an additional income tax expense. However, it marks an improvement from the sequential fourth quarter.

Andrew Duff, chairman and CEO of Piper Jaffray, said in a statement, "Compared to the fourth quarter of 2011, net revenues increased 19% and pre-tax profit on a non-GAAP basis increased seven-fold. Stronger fixed income sales and trading and equity financing revenues, and solid asset management and public finance results drove the improved performance."

Capital Markets segment revenues for the quarter declined 7 percent from the year-ago period to $99.7 million, reflecting lower equity financing revenues, advisory services revenues, and equity institutional brokerage revenues.

However, revenues at the segment rose 22 percent compared to the sequential fourth quarter, primarily driven by significantly improved fixed income institutional brokerage revenues.

Asset management segment revenues decreased 1 percent from last year, but increased 4 percent from the fourth quarter.

Piper Jaffray's assets under management rose to $13.3 billion from $12.8 billion in the year-ago period.

The company's net income for the first quarter was $2.48 million or $0.15 per share, down from $5.71 million or $0.38 per share in the year-ago period. The company reported a loss of $116.4 million or $7.38 per share in the preceding fourth quarter.

On average, 4 analysts polled by Thomson Reuters expected the company to report earnings per share of $0.32 for the quarter. Analysts estimates typically exclude one-time items.

The latest quarter's results include $3.4 million or $0.18 per share of additional income tax expense for writing off equity-related deferred tax assets.

Net revenues for the quarter declined 5.7 percent to $117.67 million from $124.78 million in the year-ago period. Analysts had a consensus estimate of $111.35 million for the quarter.

In Wednesday's session, PJC is trading at $24.59, down $0.82 or 3.23 percent on a volume of 2,000 shares.

by RTTNews Staff Writer

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