- Record annual net revenues of $11.62 billion and record net
income available to common shareholders of $1.73 billion for fiscal
2023, up 6% and 15%, respectively, over fiscal 2022
- Return on common equity of 17.7% and adjusted return on
tangible common equity of 22.5%(1) for fiscal 2023
- Domestic Private Client Group net new assets(2)(3) of $14.2
billion for the fiscal fourth quarter and $73.3 billion for fiscal
2023, annualized growth from beginning of period assets of 5.0% and
7.7%, respectively
- Record quarterly net revenues of $3.05 billion, up 8% over
the prior year’s fiscal fourth quarter and 5% over the preceding
quarter
- Quarterly net income available to common shareholders of
$432 million, or $2.02 per diluted share, and quarterly adjusted
net income available to common shareholders of $457 million(1), or
$2.13 per diluted share(1)
- Client assets under administration of $1.26 trillion and
financial assets under management of $196.4 billion
- Net interest income and Raymond James Bank Deposit Program
(“RJBDP”) fees from third-party banks of $711 million during the
quarter, up 17% over the prior year’s fiscal fourth quarter and
flat compared to the preceding quarter
Raymond James Financial, Inc. (NYSE: RJF) today reported record
net revenues of $3.05 billion and net income available to common
shareholders of $432 million, or $2.02 per diluted share, for the
fiscal fourth quarter ended September 30, 2023. Excluding $34
million of expenses related to acquisitions, quarterly adjusted net
income available to common shareholders was $457 million(1), or
$2.13 per diluted share(1).
Record quarterly net revenues increased 8% over the prior year’s
fiscal fourth quarter primarily driven by higher asset management
and related administrative fees and the benefit of higher
short-term interest rates on net interest income and RJBDP fees
from third-party banks. The 5% sequential increase in quarterly net
revenues was primarily due to higher asset management and related
administrative fees and investment banking revenues.
Quarterly earnings were negatively impacted by elevated
provisions for legal and regulatory matters, including an
incremental $55 million provision related to the
previously-disclosed SEC industry sweep on off-platform
communications.
Compared to the prior fiscal year, record net revenues of $11.62
billion increased 6%, record earnings per diluted common share of
$7.97 increased 14%, and adjusted earnings per diluted common share
of $8.30(1) increased 11%. The Private Client Group and Bank
segments generated record net revenues and Private Client Group
generated record pre-tax income for the fiscal year. Return on
common equity was 17.7% and adjusted return on tangible common
equity was 22.5%(1).
“We generated record net revenues and record net income to
common shareholders for fiscal year 2023, despite the challenging
macroeconomic environment,” said Chair and CEO Paul Reilly. “Our
third consecutive year of record results once again highlights the
strength of our diverse and complementary businesses. We enter
fiscal 2024 with strong client asset levels and healthy pipelines
for growth across the business; however, given uncertainty around
interest rates and geopolitical conditions, we remain relentlessly
focused on maintaining strong capital ratios and a flexible balance
sheet to support our results in any market environment.”
Segment ResultsPrivate Client
Group
- Domestic Private Client Group net new assets(2)(3) of $14.2
billion for the fiscal fourth quarter and $73.3 billion for fiscal
2023, annualized growth from beginning of period assets of 5.0% and
7.7%, respectively
- Record quarterly net revenues of $2.27 billion, up 14% over
the prior year’s fiscal fourth quarter and 4% over the preceding
quarter
- Record quarterly pre-tax income of $477 million, up 29% over
the prior year’s fiscal fourth quarter and 16% over the preceding
quarter
- Record annual net revenues of $8.65 billion and record
annual pre-tax income of $1.76 billion, up 12% and 71%,
respectively, over fiscal 2022
- Private Client Group assets under administration of $1.20
trillion, up 16% over September 2022 and down 2% compared to June
2023
- Private Client Group assets in fee-based accounts of $683.2
billion, up 17% over September 2022 and down 2% compared to June
2023
- Total clients’ domestic cash sweep and Enhanced Savings
Program (“ESP”) balances of $56.4 billion, down 16% compared to
September 2022 and 3% compared to June 2023
Record quarterly results were primarily driven by higher asset
management and related administrative fees, reflecting growth of
assets in fee-based accounts during the year, along with an
increase in RJBDP fees due to higher short-term interest rates.
Total clients’ domestic cash sweep and ESP balances declined 3%
compared to June 2023, reflecting lower cash sweep balances largely
due to quarterly fee billings and cash sorting activity, which more
than offset strong growth in ESP balances. Reflecting higher
short-term interest rates, the average yield on RJBDP third-party
bank balances of 3.60% increased 175 basis points over the prior
year’s fiscal fourth quarter and 23 basis points sequentially.
“Advisors are attracted to our robust technology capabilities
and client-first values, leading to strong retention and recruiting
across our employee, independent contractor and independent RIA
affiliation options,” said Reilly. “Furthermore, strong financial
advisor retention and recruiting results helped us achieve
attractive organic growth, with domestic Private Client Group net
new asset(2)(3) growth of 7.7% over the prior 12 months.”
Capital Markets
- Quarterly net revenues of $341 million, down 15% compared to
the prior year’s fiscal fourth quarter and up 24% over the
preceding quarter
- Quarterly pre-tax loss of $7 million
- Quarterly investment banking revenues of $194 million, down
6% compared to the prior year’s fiscal fourth quarter and up 38%
over the preceding quarter
- Annual net revenues of $1.21 billion, down 33% compared to
fiscal 2022; Annual pre-tax loss of $91 million
The year-over-year declines in quarterly net revenues and
pre-tax income were driven primarily by lower fixed income
brokerage, affordable housing investments and investment banking
revenues. Sequentially, net revenues grew 24% primarily driven by
improved M&A and advisory revenues.
“We are encouraged by the 38% sequential improvement in
investment banking revenues during the quarter,” said Reilly.
“Entering fiscal 2024, the investment banking pipeline remains
healthy and new business activity is solid, however, the timing of
closings is largely dependent on market conditions.”
Asset Management
- Quarterly net revenues of $236 million, up 9% over the prior
year’s fiscal fourth quarter and 4% over the preceding
quarter
- Quarterly pre-tax income of $100 million, up 20% over the
prior year’s fiscal fourth quarter and 12% over the preceding
quarter
- Annual net revenues of $885 million and annual pre-tax
income of $351 million, down 3% and 9%, respectively, compared to
fiscal 2022
- Financial assets under management of $196.4 billion, up 13%
over September 2022 and down 2% compared to June 2023
Quarterly net revenues and pre-tax income increased over the
prior year’s fiscal fourth quarter driven primarily by higher
financial assets under management due to net inflows to fee-based
accounts in the Private Client Group and net inflows at Raymond
James Investment Management (“RJIM"), as well as market
appreciation over the prior year. RJIM generated $921 million of
net inflows during the fiscal fourth quarter and $2.2 billion of
net inflows during the fiscal year.
Bank
- Quarterly net revenues of $451 million, up 5% over the prior
year’s fiscal fourth quarter and down 12% compared to the preceding
quarter
- Quarterly pre-tax income of $78 million, down 37% compared
to the prior year’s fiscal fourth quarter and up 18% over the
preceding quarter
- Bank segment net interest margin (“NIM”) of 2.87% for the
quarter, down 4 basis points compared to the prior year’s fiscal
fourth quarter and 39 basis points compared to the preceding
quarter
- Record annual net revenues of $2.01 billion and annual
pre-tax income of $371 million, up 86% and down 3% compared to
fiscal 2022, respectively
- Net loans of $43.8 billion, up 1% over September 2022 and
June 2023
Quarterly net revenues increased 5% over the prior-year quarter
but declined 12% sequentially, primarily due to lower NIM. The Bank
segment’s NIM decreased 39 basis points during the quarter to
2.87%, primarily due to increased interest expense from higher-cost
funding as ESP balances replaced a portion of lower-cost RJBDP
client cash sweep balances, which were swept to third-party banks.
Quarterly bank loan provision for credit losses of $36 million
primarily reflects an increase in the allowance on corporate loans.
The credit quality of the loan portfolio is solid, with criticized
loans as a percent of total loans held for investment ending the
quarter at 1.17%. Bank loan allowance for credit losses as a
percent of total loans held for investment was 1.07%, and bank loan
allowance for credit losses on corporate loans as a percent of
corporate loans held for investment was 2.03%.
Other
In the fiscal fourth quarter, the Other segment results include
the incremental provision related to the previously-disclosed SEC
industry sweep on off-platform communications of $55 million,
resulting in a negative impact to earnings per diluted share during
the quarter of $0.26.
During the fiscal year, the firm repurchased 8.35 million shares
of common stock for $788 million at an average price of $94 per
share. As of October 25, 2023, approximately $750 million remained
available under the Board’s approved common stock repurchase
authorization. At the end of the quarter, the total capital ratio
was 22.8%(4) and the tier 1 leverage ratio was 11.9%(4), both well
above regulatory requirements.
A conference call to discuss the results will take place today,
Wednesday, October 25, at 5:00 p.m. ET. The live audio webcast, and
the presentation which management will review on the call, will be
available at
www.raymondjames.com/investor-relations/financial-information/quarterly-earnings.
For a listen-only connection to the conference call, please dial:
877-400-4403 (conference code: 3778589). An audio
replay of the call will be available at the same location until
January 24, 2024.
Click here to view full earnings results, earnings supplement,
and earnings presentation.
About Raymond James Financial, Inc.
Raymond James Financial, Inc. (NYSE: RJF) is a leading
diversified financial services company providing private client
group, capital markets, asset management, banking and other
services to individuals, corporations and municipalities. The
company has approximately 8,700 financial advisors. Total client
assets are $1.26 trillion. Public since 1983, the firm is listed on
the New York Stock Exchange under the symbol RJF. Additional
information is available at www.raymondjames.com.
Forward-Looking Statements
Certain statements made in this press release may constitute
“forward-looking statements” under the Private Securities
Litigation Reform Act of 1995. Forward-looking statements include
information concerning future strategic objectives, business
prospects, anticipated savings, financial results (including
expenses, earnings, liquidity, cash flow and capital expenditures),
industry or market conditions, demand for and pricing of our
products, divestitures, anticipated results of litigation,
regulatory developments, and general economic conditions. In
addition, future or conditional verbs such as “will,” “may,”
“could,” “should,” and “would,” as well as any other statement that
necessarily depends on future events, are intended to identify
forward-looking statements. Forward-looking statements are not
guarantees, and they involve risks, uncertainties and assumptions.
Although we make such statements based on assumptions that we
believe to be reasonable, there can be no assurance that actual
results will not differ materially from those expressed in the
forward-looking statements. We caution investors not to rely unduly
on any forward-looking statements and urge you to carefully
consider the risks described in our filings with the Securities and
Exchange Commission (the “SEC”) from time to time, including our
most recent Annual Report on Form 10-K, and subsequent Quarterly
Reports on Form 10-Q and Current Reports on Form 8-K, which are
available at www.raymondjames.com and the SEC’s website at
www.sec.gov. We expressly disclaim any obligation to update any
forward-looking statement in the event it later turns out to be
inaccurate, whether as a result of new information, future events,
or otherwise.
Media Contact: Steve Hollister
Raymond James
727.567.2824
Investor Contact: Kristina Waugh
Raymond James
727.567.7654
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