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Ladenburg Thalmann Reports Third Quarter Financial Results

Stocks in this article: LTS

Stock Repurchase Program

During the period from January 1, 2012 through September 30, 2012, Ladenburg repurchased 711,537 shares of its common stock at a cost of approximately $1.1 million, representing an average price per share of $1.61. Since the inception of its stock repurchase program in March 2007, Ladenburg has repurchased 2,780,837 shares at a total cost of approximately $4.4 million. Ladenburg has the authority to repurchase an additional 4,719,163 shares under its current repurchase plan. During the nine months ended September 30, 2012, the Company's directors and officers, or their affiliates, purchased an aggregate of 464,000 shares in open market transactions at a total cost of approximately $0.8 million, representing an average price per share of $1.66.

About Ladenburg

Ladenburg Thalmann Financial Services is engaged in independent brokerage and advisory services, investment banking, equity research, institutional sales and trading, and asset management services through its principal subsidiaries, Ladenburg Thalmann & Co. Inc., Investacorp, Inc., Triad Advisors, Inc. and Securities America, Inc., which together have approximately 2,700 financial advisors and approximately $70 billion in client assets. Founded in 1876 and a New York Stock Exchange member since 1879, Ladenburg Thalmann & Co. is a full service investment banking and brokerage firm providing services principally for middle market and emerging growth companies and high net worth individuals. Investacorp, Inc., a leading independent broker-dealer headquartered in Miami, Florida, has been serving the independent registered representative community since 1978. Founded in 1998, Triad Advisors, Inc. is a leading independent broker-dealer and registered investment advisor headquartered in Norcross, Georgia that offers a broad menu of products, services and total wealth management solutions. Securities America, based in Omaha, Nebraska, was founded in 1984 and is one of the largest and most successful independent broker-dealers in the country. Ladenburg Thalmann Financial Services is based in Miami, Florida. Ladenburg Thalmann & Co. is based in New York, New York with regional offices in Miami, Naples and Boca Raton, Florida; Melville, New York; Houston, Texas; Calabasas, California; Boston, Massachusetts and Princeton, New Jersey. For more information, please visit www.ladenburg.com.

This press release includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding future financial performance, future growth, future acquisitions, recruitment of financial advisors, synergies, growth of our independent brokerage and advisory business and growth of our investment banking and capital markets businesses. These statements are based on management’s current expectations or beliefs and are subject to uncertainty and changes in circumstances. Actual results may vary materially from those expressed or implied by the statements herein due to changes in economic, business, competitive and/or regulatory factors, and other risks and uncertainties affecting the operation of the Company’s business. These risks, uncertainties and contingencies include those set forth in the Company’s annual report on Form 10-K for the fiscal year ended December 31, 2011 and other factors detailed from time to time in its other filings with the Securities and Exchange Commission. The information set forth herein should be read in light of such risks. Further, investors should keep in mind that the Company’s quarterly revenue and profits can fluctuate materially depending on many factors, including the number, size and timing of completed offerings and other transactions. Accordingly, the Company’s revenue and profits in any particular quarter may not be indicative of future results. The Company is under no obligation to, and expressly disclaims any obligation to, update or alter its forward-looking statements, whether as a result of new information, future events, changes in assumptions or otherwise.

[Financial Table Follows]

LADENBURG THALMANN FINANCIAL SERVICES INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Dollars in thousands, except share and per share amounts)

(Unaudited)

   
Three Months Ended Nine months ended
September 30, September 30,
2012   2011 2012   2011
 
Revenues:
 
Commissions $ 80,599 $ 25,824 $ 243,931 $ 84,676
Advisory fees 58,660 14,971 171,107 47,920
Investment banking 6,140 3,509 22,841 25,171
Principal transactions 33 (524 ) (769 ) (1,576 )
Interest and dividends 1,321 130 3,372 419
Service fees and other income   13,081     4,988     37,452     9,721  
Total revenues   159,834     48,898     477,934     166,331  
 
Expenses:
 
Commissions and fees 119,050 31,158 353,817 102,845
Compensation and benefits 18,700 10,903 59,281 37,503
Non-cash compensation 1,054 688 3,645 2,772
Brokerage, communication and clearance fees 2,412 1,933 7,420 5,809
Rent and occupancy, net of sublease revenue 1,642 810 4,924 2,425
Professional services 2,145 769 5,812 2,754
Interest 6,148 820 18,400 2,468
Depreciation and amortization 3,979 862 12,112 2,650
Amortization of retention loans 1,712 - 5,295 -
Acquisition related expense - 700 - 700
Other   9,530     3,041     27,278     7,915  
Total expenses   166,372     51,684     497,984     167,841  
Loss before item shown below (6,538 ) (2,786 ) (20,050 ) (1,510 )
Change in fair value of contingent consideration   909     -     7,111     -  
Loss before taxes (5,629 ) (2,786 ) (12,939 ) (1,510 )
Income tax expense   408     284     1,060     951  
Net loss $ (6,037 ) $ (3,070 ) $ (13,999 ) $ (2,461 )
 
Net loss per common share (basic and diluted) $ (0.03 ) $ (0.02 ) $ (0.08 ) $ (0.01 )

Weighted average common shares used in computation of per share data:

Basic and diluted

  183,460,777     182,810,137     183,610,148     183,068,493  
 




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