Retail brokerage

A.G. Edwards

(AGE) - Get Report

reported fiscal first-quarter earnings and revenue that fell vs. a year ago due to continued weakness in the stock market.

The company said earnings for the quarter ended May 31, 2002, fell 13% from a year earlier to $39 million, or 48 cents a share, from $45 million, or 56 cents a share. Net revenue slipped to $598 million from $606 million in the year-ago quarter. Analysts were expecting earnings of 44 cents a share.

A.G. Edwards' rapidly growing investment banking business and a small increase in asset management revenue couldn't offset continued weakness in its core brokerage business and a sharp drop in net interest revenue.

Revenue from brokerage commissions fell 4%, or $10 million, to $251 million, while net interest revenue dropped 42% to $29 million. Asset management and service fees climbed 3%, or $6 million, to $169 million.

Continuing a trend begun last year, the company's investment banking revenue surged 35%, or $16 million, to $62 million. Despite a sluggish environment for stock offerings and mergers and acquisition advice, A.G. Edwards is still a small player in investment banking giving it more room to grow.

Principal transaction revenues slipped 2% from a year ago to $84 million.

During the first quarter, total non-interest expenses were $537 million, up slightly from $535 million a year ago. Compensation costs fell 2% to $396 million. Non-compensation-related expenses rose 7%, or $10 million, to $142 million for the quarter, "primarily reflecting an increase in communication and technology expenses," the company said in its statement.

Shares of A.G. Edwards were lately rising 16 cents to $35.91.