National Discount Brokers
( NDB) rose Thursday after the company beat Wall Street expectations with surprisingly strong fourth-quarter earnings, citing a record quarterly increase in new customer accounts and a more-than-doubling in processing volume from a year earlier.
Jersey City, NJ- based National Discount Brokers, parent company of
NDB Capital Markets
, reported quarterly net income of $8.7 million, or 47 cents per diluted share, a 29% increase from the $6.7 million income for the same period a year earlier. Earnings per share for the year-ago period were also 47 cents.
The consensus earnings estimate among Wall Street analysts surveyed by
First Call/Thomson Financial
was 42 cents per share, a nickel below actual fourth-quarter earnings.
The nationwide financial services company reported net income of $53.5 million for the fiscal year, which ended May 31. That's 1.5 times last year's income of $21 million.
National Discount Brokers recorded revenue of $120.7 million for the fourth quarter, an increase of 80% over last year's $66.9 million in revenue for the same period. For the fiscal year, the company reported revenues of $385.8 from continuing operations, up from $207.9 million the last fiscal year.
President and CEO Arthur Kontos said the company capitalized on the year's favorable market environment, producing the highest operating revenues and profits in its history. "We took advantage of being in the right business at the right time," said Kontos, in a prepared statement.
NDB.com, the group's online retail brokerage that allows clients to trade via Internet and telephone, added a record 37,700 new accounts in the fourth quarter, bringing the total to 245,600 accounts at the end of the fiscal year - a nearly 75% increase in new accounts from the year before.
NDB Capital Markets, which offers brokerage services for institutional investors and serves as a market maker for
, increased its ticket volume by more than 150% in the fourth quarter compared to the same year-ago period. Share trading volume jumped 120% to 5.5 billion shares in the fourth quarter of 2000.
National Discount Brokers expects to start clearing its own transactions by the beginning of 2001, which could initially increase, but eventually reduce, clearing cost charges.
The company expects to spend as much as $25 million during the upcoming year on technological and product-related improvements and $50 million on advertising, and hire an additional 200 employees. National Discount Brokers Group's workforce grew by more than 200 over the past year, to 854 employees.
National Discount Brokers finished up 2 3/4, or 8%, at 39 1/2.