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Investors Capital Holdings Reports First Quarter Profit

Stocks in this article: ICH

LYNNFIELD, Mass., Aug. 14, 2012 (GLOBE NEWSWIRE) -- Investors Capital Holdings, Ltd. (NYSE Amex:ICH) (the "Company"), a financial services holding company, posted first quarter net income of $0.26 million on total revenue of $20.80 million for the period ended June 30, 2012 (the "quarter end"). Specific expense reduction initiatives implemented during the fourth quarter of the prior fiscal year translated into reduced operating costs across nearly all expense-related categories, resulting in both operating and net income in the first quarter of the new fiscal year. Investors Capital Holdings, Ltd. operates primarily through its wholly-owned subsidiary, Investors Capital Corporation ("ICC"), a dually registered broker-dealer and investment advisory firm.

Total revenue decreased 3.0% to $20.80 million compared to revenue of $21.44 million for the quarter ended June 30, 2011 (the "prior period"). The decline was due to a reduction in commission revenue, which accounts for 77.3% of total revenue. Commission revenue fell 4.9% to $16.09 million, compared to $16.92 million in the prior period, due to lower trading volume resulting from cautious investor sentiment brought on by fluctuating, uncertain market conditions. Advisory fees, which comprise 19.8% of total revenue, remained fairly consistent with the prior period, declining 1.7% to $4.11 million, compared to $4.18 million in the prior period.

Total expenses fell $1.91 million or 8.6%, declining in every expense-related category, resulting in operating income of $0.45 million compared to an operating loss of $0.82 million for the prior period and net income of $0.26 million for the quarter compared to a net loss of $1.26 million for the prior period. Net profit was the result of decreases in the Company's core expense run rate from cost-management opportunities along with completion of non-recurring expenses related to the S-3 offering filed in the prior period.

Investors Capital continues to benefit from enhancing the overall quality of its representatives by providing broad practice management solutions to assist its advisors in growing their practices and recruiting established, high-performing representatives. The firm's average revenue per representative, based on a rolling 12-month period, rose at the end of the first quarter to $169,934, an increase of 5.6% over $160,943 for the prior rolling 12-month period.

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