|KBW, INC. AND SUBSIDIARIES Consolidated Statements of Operations (Dollars in thousands, except per share information) (unaudited)|
|Three Months Ended||Nine Months Ended|
|September 30, 2012||June 30, 2012||September 30, 2011||September 30, 2012||September 30, 2011|
|Principal transactions, net||3,627||3,480||(19,917||)||17,613||9,375|
|Interest and dividend income||3,758||1,721||2,028||7,264||8,383|
|Compensation and benefits||33,836||40,639||43,249||117,404||138,778|
|Occupancy and equipment||4,826||4,806||5,793||14,332||17,081|
|Communications and data processing||7,249||7,318||8,893||22,303||26,676|
|Brokerage and clearance||2,127||2,390||5,380||7,879||14,876|
|Loss before income taxes||(7,220||)||(8,717||)||(25,203||)||(15,235||)||(24,293||)|
|Income tax benefit||(2,035||)||(3,294||)||(9,474||)||(5,093||)||(8,957||)|
|Earnings per share:|
|Dividends declared per share||$||0.05||$||0.05||$||0.05||$||0.15||$||0.15|
|Weighted average number of common shares outstanding:|
Capital Management The Company also announced today that its board of directors, in light of the Company’s continuing strong capital position, has declared a cash dividend with respect to the third quarter in an amount equal to $0.05 per share of its outstanding common stock. The dividend is payable on December 14, 2012 to shareholders of record on December 5, 2012. During the quarter, the Company did not purchase any shares under the stock repurchase program and has $48.7 million available for future purchases. KBW expects to file its quarterly report on Form 10-Q with the U.S. Securities and Exchange Commission on or about November 9, 2012. About KBW KBW, Inc. operates in the U.S., Europe and Asia through its broker dealer subsidiaries, Keefe, Bruyette & Woods, Inc., Keefe, Bruyette & Woods Limited and Keefe, Bruyette & Woods Asia Limited. Celebrating its 50th anniversary, KBW has established itself as a leading independent authority in the banking, insurance, brokerage, asset management, mortgage banking, real estate and specialty finance sectors. Founded in 1962, the firm maintains industry-leading positions in the areas of research, corporate finance, mergers and acquisitions as well as sales and trading in equities and debt securities of financial services companies. Statements in this press release that are not statements of historical or current fact constitute forward-looking statements. In some cases, you can identify these statements by words such as “may”, “might”, “will”, “should”, “expect”, “plan”, “intend”, “anticipate”, “believe”, “estimate”, “predict”, “potential”, or “continue”, the negative of these terms and other comparable terminology. Such forward-looking statements, which are based on various underlying assumptions and expectations and are subject to risks, uncertainties and other unknown factors, may include projections of our future financial performance based on our growth strategies and anticipated trends in our business. These statements are only predictions based on our current expectations and projections about future events, and there are or may be important factors that could cause our actual results to be materially different from the historical results or from any future results expressed or implied by such forward-looking statements. These factors include, but are not limited to, those discussed under the caption “Risk Factors” in our most recently filed annual report on Form 10-K, which is available at the Securities and Exchange Commission website at www.sec.gov. Unless required by law, we undertake no obligation to publicly update or revise any forward-looking statement to reflect circumstances or events after the date of this press release.
Non-GAAP Financial Measures We have reported in this press release our total expenses, net loss and diluted earnings per share on a non-GAAP basis (“Non-GAAP Financial Measures”). The Non-GAAP Financial Measures for the three and nine months ended September 30, 2012 and 2011 and three months ended June 30, 2012 excluded restructuring charges related to the workforce reduction program and an additional lease obligation accrual.