Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Mar. 26, 2019 | Jun. 30, 2018 | |
Document And Entity Information | |||
Entity Registrant Name | Siebert Financial Corp | ||
Entity Central Index Key | 0000065596 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2018 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2018 | ||
Is Entity a Well-known Seasoned Issuer? | No | ||
Is Entity a Voluntary Filer? | No | ||
Is Entity's Reporting Status Current? | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Shell Company | false | ||
Entity Emerging Growth Company | false | ||
Entity Common Stock, Shares Outstanding | 27,157,188 | ||
Entity Public Float | $ 67,418,000 |
CONSOLIDATED STATEMENTS OF FINA
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
ASSETS | ||
Cash and cash equivalents | $ 7,229,000 | $ 3,765,000 |
Receivables from clearing and other brokers | 2,030,000 | 1,396,000 |
Receivable from related party | 1,000,000 | 283,000 |
Receivable from lessors | 171,000 | |
Other receivables | 96,000 | |
Prepaid expenses and other assets | 470,000 | 234,000 |
Furniture, equipment and leasehold improvements, net | 468,000 | 263,000 |
Software, net | 1,137,000 | 84,000 |
Deferred tax assets | 5,576,000 | |
Total Assets | 18,177,000 | 6,025,000 |
Liabilities | ||
Accounts payable and accrued liabilities | 699,000 | 561,000 |
Lease incentive obligation | 171,000 | |
Due to clearing brokers and related parties | 133,000 | 127,000 |
Income taxes payable | 125,000 | |
Total liabilities | 1,003,000 | 813,000 |
Commitments and contingencies | ||
Stockholders' equity | ||
Common stock, $.01 par value; 49,000,000 shares authorized, 27,157,188 shares issued and outstanding as of December 31, 2018 and December 31, 2017 | 271,000 | 271,000 |
Additional paid-in capital | 7,641,000 | 7,641,000 |
Retained earnings/(Accumulated deficit) | 9,262,000 | (2,700,000) |
Stockholders' equity | 17,174,000 | 5,212,000 |
Liabilities and Stockholders' equity | $ 18,177,000 | $ 6,025,000 |
CONSOLIDATED STATEMENTS OF FI_2
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (Parenthetical) - $ / shares | Dec. 31, 2018 | Dec. 31, 2017 |
Stockholder's equity: | ||
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, authorized shares | 49,000,000 | 49,000,000 |
Common stock, issued shares | 27,157,188 | 27,157,188 |
Common stock, outstanding shares | 27,157,188 | 27,157,188 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Revenue: | ||
Margin interest, marketing and distribution fees | $ 10,928,000 | $ 6,600,000 |
Commissions and fees | 9,504,000 | 4,801,000 |
Principal transactions | 9,020,000 | 1,639,000 |
Advisory fees | 478,000 | 51,000 |
Interest | 106,000 | 19,000 |
Total Revenue | 30,036,000 | 13,110,000 |
Expenses: | ||
Employee compensation and benefits | 13,817,000 | 5,075,000 |
Clearing fees, including execution costs | 2,852,000 | 1,031,000 |
Professional fees | 1,963,000 | 2,135,000 |
Other general and administrative | 1,859,000 | 1,510,000 |
Technology and communications | 1,008,000 | 410,000 |
Rent and occupancy | 988,000 | 437,000 |
Depreciation and amortization | 144,000 | 115,000 |
Advertising and promotion | 45,000 | 87,000 |
Total Expenses | 22,676,000 | 10,800,000 |
Income before (benefit) for (from) income taxes | 7,360,000 | 2,310,000 |
(Benefit) provision (from) for income taxes | (4,602,000) | 153,000 |
Net income | $ 11,962,000 | $ 2,157,000 |
Net income per share of common stock Basic and diluted | $ 0.44 | $ .10 |
Weighted average shares outstanding Basic and diluted | 27,157,188 | 22,507,798 |
CONSOLIDATED STATEMENT OF CHANG
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) | Number of Shares $.01 Par Value [Member] | Additional Paid-In Capital [Member] | Retained Earnings / (Accumulated Deficit) [Member] | Total |
Beginning balance at Dec. 31, 2016 | $ 221,000 | $ 6,889,000 | $ (4,857,000) | $ 2,253,000 |
Beginning balance, shares at Dec. 31, 2016 | 22,085,126 | |||
Issuance of stock | $ 50,000 | 19,933,000 | 19,983,000 | |
Issuance of stock, shares | 5,072,062 | |||
Net income | 2,157,000 | 2,157,000 | ||
Capital Contribution | 803,000 | 803,000 | ||
Distributions | (19,984,000) | (19,984,000) | ||
Ending balance at Dec. 31, 2017 | $ 271,000 | 7,641,000 | (2,700,000) | 5,212,000 |
Ending balance, shares at Dec. 31, 2017 | 27,157,188 | |||
Net income | 11,962,000 | 11,962,000 | ||
Ending balance at Dec. 31, 2018 | $ 271,000 | $ 7,641,000 | $ 9,262,000 | $ 17,174,000 |
Ending balance, shares at Dec. 31, 2018 | 27,157,188 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Cash flows from operating activities | ||
Net income | $ 11,962,000 | $ 2,157,000 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Reduction in valuation allowance related to deferred tax assets | (5,576,000) | |
Depreciation and amortization | 144,000 | 115,000 |
Changes in | ||
Receivables from clearing and other brokers | (634,000) | (790,000) |
Receivable from related party | (717,000) | (283,000) |
Receivable from lessors | (171,000) | |
Other receivables | (96,000) | |
Prepaid expenses and other assets | (236,000) | 108,000 |
Securities owned, at fair value | 92,000 | |
Accounts payable and accrued liabilities | 138,000 | (199,000) |
Lease incentive obligation | 171,000 | |
Due to clearing brokers and related parties | 6,000 | 127,000 |
Income taxes payable | (125,000) | 125,000 |
Net cash provided by operating activities | 4,866,000 | 1,452,000 |
Cash Flows From investing activities | ||
Purchase of furniture, equipment, and leasehold improvements | (277,000) | (417,000) |
Purchase of software | (1,125,000) | |
Net cash used in investing activities | (1,402,000) | (417,000) |
Net increase in cash and cash equivalents | 3,464,000 | 1,035,000 |
Cash and cash equivalents - beginning of year | 3,765,000 | 2,730,000 |
Cash and cash equivalents - end of year | 7,229,000 | 3,765,000 |
Supplemental Cash Flow information | ||
Cash paid during the year for income taxes | 1,177,000 | 33,000 |
Cash paid during the year for interest | 15,000 | |
Non cash investing and financing activities | ||
Payment by related party of expenses | 803,000 | |
Payment by related party of accrued settlement liability | (825,000) | |
Issuance of shares for StockCross acquisition | $ (19,984,000) |
Organization
Organization | 12 Months Ended |
Dec. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | 1. Organization Siebert Financial Corp., a New York corporation incorporated in 1934, is a holding company that conducts its retail discount brokerage business through its wholly-owned subsidiary, Muriel Siebert & Co., Inc. (“MSCO”), a Delaware corporation and registered broker-dealer, its investment advisory business through its wholly-owned subsidiary, Siebert AdvisorNXT, Inc. (“AdvisorNXT”), a New York corporation registered with the SEC as a Registered Investment Advisor under the Investment Advisers Act of 1940, as amended, its insurance business through its wholly-owned subsidiary, Park Wilshire Companies, Inc. (“PWC”), a Texas corporation and licensed insurance agency, and KCA Technologies, LLC. (“KCAT”), a Nevada limited liability company and developer of robo-advisory technology. For purposes of this Form 10-K, the terms “Siebert,” “Company,” “we,” “us,” and “our” refer to Siebert Financial Corp., MSCO, AdvisorNXT, PWC, and KCAT collectively, unless the context otherwise requires. The Company is headquartered in New York, NY, with primary operations in New Jersey and California. The Company has offices throughout the U.S. and clients around the world. The Company’s SEC filings are available through the Company’s website at www.siebertnet.com, where investors are able to obtain copies of the Company’s public filings free of charge. The Company’s Common Stock, par value $.01 per share, trades on the Nasdaq Capital Market under the symbol “SIEB.” The Company primarily operates in the securities brokerage and asset management industry and has no other reportable segments. All of the Company's revenues for the years ended December 31, 2018 and 2017 were derived from its operations in the U.S. Transactions completed during 2018 Acquisition of KCAT On August 21, 2018, the Company acquired all of the issued and outstanding membership interests of KCAT from Kennedy Cabot Acquisition LLC, (“KCA”), one of the Company’s affiliates through common ownership, for approximately $690,000. This transaction was accounted for as an asset acquisition. KCAT is a technology company initially tasked with developing a sophisticated Robo-Advisor for AdvisorNXT, the Company’s RIA. The Robo-Advisor provides clients with an automated wealth management solution intended to maximize portfolio returns based on the client’s specific risk tolerance. Acquisition of PWC In March 2018, the Company acquired all of the issued and outstanding shares of PWC from three related parties for approximately $110,000 (equal to the amount of cash held in PWC’s bank accounts at the time). The Board of Directors reviewed the transaction and concluded that, given the amount of the purchase price, the fact that the purchase price equaled the cash on hand in PWC’s bank accounts, and that PWC had no liabilities, the acquisition was not material and did not require a third party valuation. The sellers agreed to indemnify the Company from all liability attendant to the prior business activities of PWC. David J. Gebbia agreed to continue as the unpaid CEO of PWC. Transactions completed in prior to 2018 Acquisition of StockCross Retail Assets The Company entered into an agreement to acquire most of the retail broker-dealer business of StockCross Financial Services (“StockCross”), an affiliate of the Company, in exchange for 5,072,062 shares of the Company’s restricted Common Stock, subject to a two-year lock-up, valued at $19,984,000. Approximately $125,000 of legal and appraisal fees were incurred in the consummation of the transaction. In addition, the Company acquired various rent obligations, transferred employees and customer lists. As StockCross was determined to be an entity under common control, the assets and liabilities transferred to the Company from StockCross were recorded at historical cost in accordance with ASC 805-50, Business Combinations - Related Issues. The difference between the consideration paid and historical cost of the net assets acquired was recorded as an equity distribution by the Company. ASC 805-50 transactions between entities under common control stipulates a common control transaction as a transfer of net assets or an exchange of equity interests between entities under common control. Since the assets acquired from StockCross had a book value of nil, the fair market value of assets acquired, approximately $19,984,000, was reflected as nil for financial statement purposes as of the date of transfer as required by ASC 805-50. Additionally, as the transfer of net assets and related operations did not change the composition of MSCO as a reporting entity, retrospective combination of the entities for all periods presented as if the combination has been in effect since the inception of common control is not required. Accordingly, the net assets transferred and related operations are presented prospectively as of the effective date of November 30, 2017. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation The accompanying consolidated financial statements are prepared on the accrual basis of accounting in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) as established by the Financial Accounting Standards Board (“FASB”) to ensure consistent reporting of financial condition. The consolidated financial statements include the accounts of Siebert and its wholly-owned subsidiaries and upon consolidation, all intercompany balances and transactions are eliminated. The U.S. dollar is the functional currency of the Company. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The Company makes significant estimates that affect the reported amounts of assets, liabilities, revenue, and expenses. The estimates relate primarily to revenue and expenses in the normal course of business as to which the Company receives no confirmations, invoices, or other documentation at the time the books are closed. The Company uses its best judgment, based on knowledge of these revenue transactions and expenses incurred, to estimate the amount of such revenue and expenses. The Company is not aware of any material differences between the estimates used in closing the Company’s books for the last five years and the actual amounts of revenue and expenses incurred when the Company subsequently receives the actual confirmations, invoices, or other documentation. Estimates are used in intangible asset valuations and useful lives, depreciation, income taxes, and the contingent liabilities related to legal and healthcare expenses. The Company also estimates the valuation allowance relating to its deferred tax assets based on the more likely than not criteria. The Company believes that its estimates are reasonable. Reclassifications Certain prior period amounts have been reclassified to conform to the current year’s presentation. These reclassifications have no effect on previously reported net income. Cash and Cash Equivalents Cash and cash equivalents are all cash balances that are unrestricted. The Company has defined cash equivalents as highly liquid investments, with original maturities of less than 90 days that are not held for sale in the ordinary course of business. As of the years ended December 31, 2018 and 2017, the Company did not hold any cash equivalents. Receivables from Clearing and Other Brokers Retail customer transactions are cleared, on a fully disclosed basis, through two clearing brokers, StockCross and NFS, the former of which is an affiliate. The Company operates on a month to month basis with both clearing brokers and they offset their fees against the Company's revenues on a monthly basis. Receivables from clearing and other brokers include amounts receivable as well as cash on deposit. As of the years ended December 31, 2018 and 2017, cash clearing deposits with StockCross and NFS were $75,000 and $50,000, respectively. The Company evaluates receivables from clearing organizations and other brokers for collectability noting no amount was considered uncollectable as of the years ended December 31, 2018 and 2017. No valuation allowance is recognized for receivables from clearing and other brokers as the Company does not have a history of losses from receivables from clearing and other brokers and does not anticipate losses in the future. Furniture, Equipment and Leasehold Improvements Furniture, equipment and leasehold improvements are stated at cost, net of accumulated depreciation and amortization. Depreciation is calculated using the straight-line method over the lives of the assets, generally not exceeding four years. Leasehold improvements are amortized over the shorter of the useful life or remaining lease term unless the lease transfers ownership of the underlying asset to the lessee or lessee is reasonably certain to exercise an option to purchase the underlying asset, in which case the lessee will amortize over the useful life of the leasehold improvements. Software The Company capitalizes certain costs for software such as the Robo-Advisor, software license arrangements with a contract term of greater than 1 year, as well as other software, and amortizes the assets over the estimated useful life of the software or contract term, generally not exceeding 3 years. The Company accounts for software license arrangements with a contract term of 1 year as prepaid assets and amortizes them over the contract term. Other software costs such as routine maintenance and various data services to provide market information to customers are expensed as incurred. Amortization of Intangible Assets The Company has a finite-lived intangible asset in the Robo-Advisor acquired from KCAT. Intangible assets with finite lives are amortized on a straight-line basis over their estimated useful lives. The Company acquired the Robo-Advisor from KCAT in August 2018. The Robo-Advisor has an estimated useful life of 3 years and the Company will start to amortize it in 2019. Advertising Costs Advertising costs are expensed as incurred and totaled $45,000 and $87,000 for the years ended December 31, 2018 and 2017, respectively. Revenue Recognition and Other Income On January 1, 2018, the Company adopted the new revenue recognition standard ASC 606, Revenue from Contracts with Customers, on the modified retrospective method (i.e., cumulative method). The Company has elected the modified retrospective method which did not result in a cumulative-effect adjustment at the date of adoption. The implementation of this new standard had no material impact on the Company's consolidated financial statements for the years ended December 31, 2018 and 2017. Revenue from contracts with customers includes commissions and fees, principal transactions and advisory fees. The recognition and measurement of revenue is based on the assessment of individual contract terms. Significant judgment is required to determine whether performance obligations are satisfied at a point in time or over time; how to allocate transaction prices where multiple performance obligations are identified; when to recognize revenue based on the appropriate measure of the Company’s progress under the contract; and whether constraints on variable consideration should be applied due to uncertain future events. The primary sources of revenue for the Company are as follows: Margin Interest, Marketing and Distribution fees Margin interest, marketing and distribution fees consists of two components: margin interest and 12b1 fees. Margin interest is the net interest charged to customers for holding financed margin positions, and 12b1 fees are fees paid to the Company related to trailing payments from mutual funds as a result of prior sales of mutual funds to customers. Margin interest, marketing and distribution fees are recorded as earned. Principal Transactions Principal transactions primarily represent riskless transactions in which the Company, after executing a solicited order, buys or sells securities as principal and at the same time buys or sells the securities with a markup or markdown to satisfy the order. Principal transactions are recognized at a point in time on the trade date when the performance obligation is satisfied. The performance obligation is satisfied on the trade date because that is when the underlying financial instrument or purchaser is identified, the pricing is agreed upon and the risks and rewards of ownership have been transferred to/from the customer. Commissions and Fees The Company earns commission revenue for executing trades for clients in individual equities, options, insurance products, futures, fixed income securities, as well as certain third party mutual funds and ETFs. Commission revenue associated with combined trade execution and clearing services, as well as trade execution services on a standalone basis, is recognized at a point in time on the trade date when the performance obligation is satisfied. The performance obligation is satisfied on the trade date because that is when the underlying financial instrument or purchaser is identified, the pricing is agreed upon and the risks and rewards of ownership have been transferred to/from the customer. Advisory Fees The Company earns advisory fees associated with managing client assets. The performance obligation related to its revenue stream is satisfied over time; however, the advisory fees are variable as they are charged as a percentage of the client’s total asset value, which is determined at the end of the quarter. The following table presents the major revenue categories and when each category is recognized: Year Ended December 31, Revenue Category 2018 2017 Timing of Recognition Trading Execution and Clearing Services Commissions and fees $ 9,504,000 $ 4,801,000 Recorded on trade date Principal transactions $ 9,020,000 $ 1,639,000 Recorded on trade date Advisory fees and additional income $ 584,000 $ 70,000 Recorded as earned Other Income Margin interest, marketing and distribution fees Margin interest $ 7,663,000 $ 3,726,000 Recorded as earned 12b1 fees 3,265,000 2,874,000 Recorded as earned Total Margin interest, marketing and distribution fees $ 10,928,000 $ 6,600,000 Total Revenue $ 30,036,000 $ 13,110,000 The following table presents each revenue category and its related performance obligation: Revenue Stream Performance Obligation Principal transactions, Commissions and fees, Advisory fees and additional income Provide security trading services to customer and act as agent Margin interest, marketing and distribution fees n/a Disaggregation of Revenue The following table presents a breakdown of the Company’s revenue between the amounts attributed to the legacy Siebert customer base vs. the accounts acquired from the StockCross Retail Assets: Year Ended December 31, 2018 2017 Revenue from Principal transactions: Principal transactions – Legacy Siebert $ 1,894,000 $ 490,000 Principal transactions – StockCross Retail Assets 7,126,000 1,149,000 Total Revenue from Principal transactions $ 9,020,000 $ 1,639,000 Revenue from Commissions and fees: Commissions and fees – Legacy Siebert $ 7,792,000 $ 4,527,000 Commissions and fees – StockCross Retail Assets 1,712,000 274,000 Total Revenue from Commissions and fees $ 9,504,000 $ 4,801,000 Revenue from Margin interest, marketing and distribution fees: Margin interest, marketing and distribution fees – Legacy Siebert $ 9,674,000 $ 6,409,000 Margin interest, marketing and distribution fees – StockCross Retail Assets 1,254,000 191,000 Total Revenue from Margin interest, marketing and distribution fees $ 10,928,000 $ 6,600,000 Additional Revenue: Advisory fees – Legacy Siebert 478,000 51,000 Interest – Legacy Siebert 106,000 19,000 Total Revenue $ 30,036,000 $ 13,110,000 Income Taxes The results of operations are included in the consolidated federal income tax return of the Company as well as the consolidated or standalone state and local income tax returns of the Company and/or its subsidiaries. The amount of current and deferred taxes payable or refundable is recognized as of the date of the financial statements, utilizing currently enacted tax laws and rates. Deferred tax expenses or benefits are recognized in the financial statements for the changes in deferred tax liabilities or assets between years. The Company records accruals for uncertain tax positions when the Company believes that it is not more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. The Company makes adjustments to these accruals when facts and circumstances change, such as the closing of a tax audit or the refinement of an estimate. The Company had no uncertain tax positions as of December 31, 2018 and 2017. The Company recognizes deferred tax assets to the extent that the Company believes these assets are more likely than not to be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversal of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. To the extent the Company determines that realization of deferred tax assets is not "more likely than not," the Company establishes a valuation allowance. As a result, the amount of the deferred tax assets considered realizable could be reduced in the near term if estimates of future taxable income are reduced. Such an occurrence could materially impact the Company’s results of operations and financial condition. Evaluation of Subsequent Events The Company has evaluated events that have occurred subsequent to December 31, 2018 and through March 26, 2019, the date of the filing of this report. As previously disclosed in a Current Report on Form 8-K on January 18, 2019, the Company purchased approximately 15% of StockCross’ outstanding shares. The number of shares purchased by the Company was 922,875 at a per share price of approximately $3.97. There have been no additional material subsequent events that occurred during such period that would require disclosure in this report or would be required to be recognized in the financial statements as of December 31, 2018. Capital Stock The authorized capital stock of the Company consists of a single class of common stock. Per Share Data Basic earnings (loss) per share is calculated by dividing net income (loss) by the weighted average outstanding common shares during the year. Diluted earnings per share is calculated by dividing net income by the number of shares outstanding under the basic calculation and adding, all dilutive securities, which consist of options. Recently Issued Accounting Pronouncements ASU 2016-02 Recently Adopted Accounting Pronouncements ASU 2014-09 |
Receivables from and Payable to
Receivables from and Payable to Brokers, Dealers, and Clearing Organizations | 12 Months Ended |
Dec. 31, 2018 | |
Due to and from Broker-Dealers and Clearing Organizations [Abstract] | |
Receivables from and Payable to Brokers, Dealers, and Clearing Organizations | 3. Receivables from and Payable to Brokers, Dealers, and Clearing Organizations Amounts receivable from / payable to brokers, dealers and clearing organizations consisted of the following as of the periods indicated: As of December 31, 2018 2017 Receivables from clearing and other brokers NFS $ 1,664,000 $ 1,396,000 StockCross 310,000 — Other receivables 31,000 — Citibank 25,000 — Total Receivables from clearing and other brokers $ 2,030,000 $ 1,396,000 Receivable from related party StockCross $ 1,000,000 $ 283,000 Total Receivable from related party $ 1,000,000 $ 283,000 Due to clearing brokers and related parties NFS $ 58,000 $ — StockCross 46,000 127.000 MSCO 29,000 — Total Due to clearing brokers and related parties $ 133,000 $ 127,000 |
Furniture, Equipment and Leaseh
Furniture, Equipment and Leasehold Improvements, Net | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Furniture, Equipment and Leasehold Improvements, Net | 4. Furniture, Equipment and Leasehold Improvements, Net Furniture, equipment and leasehold improvements consisted of the following as of the periods indicated: As of December 31, 2018 2017 Leasehold improvements $ 545,000 $ 267,000 Equipment 52,000 52,000 Total Furniture, equipment, and leasehold improvements 597,000 319,000 Less accumulated depreciation and amortization (129,000 ) (56,000 ) Total Furniture, equipment, and leasehold improvements, net $ 468,000 $ 263,000 |
Software, Net
Software, Net | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Software, Net | 5. Software, Net Software consisted of the following as of the periods indicated: As of December 31, 2018 2017 Intangible asset – Robo-Advisor $ 763,000 $ — Other purchased software 459,000 97,000 Total Software 1,222,000 97,000 Less accumulated amortization – Robo-Advisor — — Less accumulated amortization – Other purchased software (85,000 ) (13,000 ) Total Software, net $ 1,137,000 $ 84,000 The Company generally recognizes software initially at cost and amortize over the estimated useful life of 3 years. In line with the Company’s policy, the basis for determining the amount capitalized for the Robo-Advisor software was determined based on the price paid to acquire KCAT. The Company estimates future amortization related to all software assets of $398,000, $398,000 and $341,000 in the years ending December 31, 2019, 2020, and 2021, respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 6. Income Taxes Income taxes consist of the following: Current income tax (benefit) / expense, which represents the amount of federal tax and state and local tax currently payable or receivable, including interest and penalties and amounts accrued for unrecognized tax benefits, if any, and; Deferred income tax (benefit) / expense, which represents the net change in the deferred tax assets or liability balance during the year, including any change in the valuation allowance. Year Ending December 31, 2018 2017 Current Federal $ 948,000 $ 51,000 State and local 26,000 102,000 Total Current $ 974,000 $ 153,000 Deferred Federal $ (3,248,000 ) $ — State and local (2,328,000 ) — Total Deferred $ (5,576,000 ) $ — Total Income tax (benefit) / expense $ (4,602,000 ) $ 153,000 Effective Income Tax Rate Reconciliation A reconciliation of the U.S. federal statutory income tax rate to the effective tax rate applicable to income before income taxes is as follows for the periods indicated: Year Ending December 31, 2018 2017 Federal statutory income tax rate 21.0 % 34.0 % Net effect of: Non-deductible expenses 0.2 % 1.2 % Depreciation (0.9 %) (4.5 %) Tax amortization of intangible assets (3.8 %) (1.6 %) Other temporary differences (1.3 %) (12.1 %) Net operating loss (2.6 %) (13.2 %) Increase due to state and local taxes, net of U.S. federal income tax effects 0.6 % 2.8 % Total Current effective income tax rate 13.2 % 6.6 % Reversal of deferred tax assets valuation allowance (75.8 %) — Total Effective income tax rate (62.6 %) 6.6 % Tax Cuts and Jobs Act In regard to the effect of the Tax Cuts and Jobs Act, which lowered U.S. federal corporate income tax rates from 34% to 21%, the Company determined that the primary impact was a reduction in income tax expense in 2018 as well the projected income tax expense subsequent years. The statutory federal income tax rate in effect of 21% as of January 1, 2018 was utilized to calculate the income tax provision and the deferred tax assets as of December 31, 2018. As such, the change in federal income tax rates affected the valuation of the gross deferred tax assets. Net Operating Losses The Company’s pre-tax federal and state and local NOLs for tax purposes as of December 31, 2018 were approximately $16.1 million and $27.1 million, respectively, which expire by 2036. The federal NOL carryforwards have been reduced by the impact of annual limitations of approximately $895,000 per year as described in the Internal Revenue Code Section 382 that arose as a result of an ownership change. Deferred tax assets are reported net of NOLs that have expired or are not expected to be utilized in the future. Income Tax Examinations The Company is subject to federal, state, and local tax examinations for a period typically between three and four years. The Company is currently under tax examination by the State of New York for tax years 2012 through 2014. As of December 31, 2018, the State of New York has not proposed any adjustment to the Company’s tax position. Except for the examination described above, the Company is not under any other tax examinations. Unrecognized Tax Benefits The Company applied the “more-likely-than not” recognition threshold to all tax positions taken or expected to be taken in a tax return which resulted in no unrecognized tax benefits reflected in the financial statements as of December 31, 2018. The Company classifies interest and penalties that would accrue according to the provisions of relevant tax law as income taxes. Deferred Tax Assets The evaluation of the recoverability of the deferred tax assets and the need for a valuation allowance requires the Company to weigh all positive and negative evidence to reach a conclusion that it is more likely than not that all or some portion of the deferred tax assets will be realized. The weight given to the evidence is commensurate with the extent to which it can be objectively verified. The more negative evidence that exists, the more positive evidence is necessary and the more difficult it is to support a conclusion that a valuation allowance is not needed. The Company’s framework for assessing the recoverability of the deferred tax assets requires a determination of whether or not there is sufficient taxable income of appropriate character within the carryback, carryforward period available under tax law. The Company considers of all available evidence, including: • Taxable income in carryback years if carryback is permitted; • Future reversals of existing taxable temporary differences; • Tax planning strategies; and • Projected future taxable income exclusive of reversing temporary difference. In assessing projected future taxable income, the Company considers all evidence, including: • The nature, frequency, and amount of cumulative financial reporting income and losses in recent years; • The sustainability of recent operating profitability of the Company; • The predictability of future operating profitability of the character necessary to realize the net deferred tax assets; • The carryforward period for the net operating loss, including the effect of reversing taxable temporary differences; and • Prudent and feasible actions and tax planning strategies that would be implemented, if necessary, to protect against the loss of the deferred tax assets. In performing the assessment of the recoverability of the deferred tax assets under this framework, the Company also considers tax laws governing the utilization of the net operating loss in each applicable jurisdiction. For the year ended December 31, 2018, the Company achieved key financial milestones such as having three years of cumulative taxable income and generating four consecutive quarters of pre-tax profitability generally greater than $1 million which led to a re-evaluation of the deferred tax assets. As of December 31, 2018, Below is a breakout of the deferred tax assets, net of valuation allowance as of the periods indicated. Prior period amounts were adjusted to reflect the impact from the Tax Cuts and Jobs Act: As of December 31, 2018 2017 Deferred tax assets Net operating loss carryforwards $ 5,811,000 $ 6,596,000 $ 5,811,000 $ 6,596,000 Deferred tax liabilities Furniture, equipment and leasehold improvements $ (193,000 ) $ (79,000 ) Contribution carryover — 126,000 Intangible assets — (25,000 ) Other reconciling items (42,000 ) — $ (235,000 ) $ 22,000 Total $ 5,576,000 $ 6,618,000 Valuation allowance — (6,618,000 ) Deferred tax assets, net of valuation allowance $ 5,576,000 $ — |
Capital Requirements
Capital Requirements | 12 Months Ended |
Dec. 31, 2018 | |
Regulatory Capital Requirements [Abstract] | |
Capital Requirements | 7. Capital Requirements MSCO is subject to the SEC’s Uniform Net Capital Rule (Rule 15c3-1), which requires the maintenance of minimum net capital. MSCO has elected to use the alternative method permitted by the rule which requires that MSCO maintain minimum net capital, as defined, equal to the greater of $250,000, or 2% of aggregate debit balances arising from customer transactions, as defined. The net capital rule also provides that equity capital may not be withdrawn or cash dividends paid if resulting net capital would be less than 5% of aggregate debits. As of December 31, 2018, MSCO had net capital of approximately $8.9 million, which was $8.7 million in excess of required net capital of $250,000. As of December 31, 2017, MSCO had net capital of approximately $4.4 million, which was $4.2 million in excess of required net capital of $250,000. MSCO claims exemption from the reserve requirements under the SEC’s Rule 15c 3-3 pursuant to paragraph (k)(2)(ii) as it clears its customer transactions through one unaffiliated and one affiliated clearing firm on a fully disclosed basis. Our cash and cash equivalents are unrestricted and are used to fund our working capital needs. The Company’s total assets as of December 31, 2018 were approximately $18.2 million, of which $7.2 million, or approximately 40%, is highly liquid. The Company’s total assets as of December 31, 2017 were approximately $6.0 million, of which $3.8 million, or approximately 62%, is highly liquid. |
Financial Instruments with Off-
Financial Instruments with Off-Balance Sheet Risk and Concentrations of Credit Risk | 12 Months Ended |
Dec. 31, 2018 | |
Financial Instruments With Off-balance-sheet Risk And Concentrations Of Credit Risk | |
Financial Instruments with Off-Balance Sheet Risk and Concentrations of Credit Risk | 8. Financial Instruments with Off-Balance Sheet Risk and Concentrations of Credit Risk Retail customer transactions are cleared, on a fully disclosed basis, through two clearing brokers, one of which is an affiliate. In the event that customers are unable to fulfill their contractual obligations, the clearing broker may charge the Company for any loss incurred in connection with the purchase or sale of securities at prevailing market prices to satisfy customers' obligations. The Company regularly monitors the activity in its customer accounts for compliance with its margin requirements. Securities transactions entered into as of December 31, 2018 have settled subsequent thereto with no material adverse effect on the Company's financial statements. Credit risk represents the potential loss that would occur if counterparties fail to perform pursuant to the terms of their obligations. The Company is subject to credit risk to the extent a custodian or broker with whom it conducts business is unable to fulfill contractual obligations. |
Commitments, Contingencies and
Commitments, Contingencies and Other | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments, Contingencies and Other | 9. Commitments, Contingencies and Other Lease Commitments The Company rents office space under operating leases expiring in 2019 through 2024. The leases call for base rent plus escalations as well as property taxes and other operating expenses. Future annual minimum base rental payments under these operating leases are as follows as of December 31, 2018: Year Amount 2019 $ 686,000 2020 651,000 2021 628,000 2022 489,000 2023 and thereafter 507,000 Total $ 2,961,000 Rent and related operating expenses amounted to $988,000 and $437,000 for the years ended December 31, 2018 and 2017, respectively. As part of the Company’s renovation of its office in Jersey City, as of December 31, 2018, the Company has a receivable from the landlord of $171,000 for tenant improvements that will be reimbursed to the Company upon the completion of the renovation. In line with the guidance under ASC 840, the Company has a tenant improvement asset and corresponding lease incentive liability recorded for this lease. The lease incentive liability will be amortized into income ratably over the life of the lease. Legal and Regulatory Matters The Company is party to certain claims, suits and complaints arising in the ordinary course of business. In the opinion of the Company, all such matters are without merit, or involve amounts which would not have a significant effect on the financial statements of the Company. General Contingencies The Company is party to certain claims, suits and complaints arising in the ordinary course of business. In the opinion of the Company’s management, all such matters are without merit, or involve amounts which would not have a significant effect on the financial statements of the Company. In the normal course of its business, the Company indemnifies and guarantees certain service providers against specified potential losses in connection with their acting as an agent of, or providing services to, the Company. The maximum potential amount of future payments that the Company could be required to make under these indemnifications cannot be estimated. However, the Company believes that it is unlikely it will have to make material payments under these arrangements and has not recorded any contingent liability in the financial statements for these indemnifications. The Company provides representations and warranties to counterparties in connection with a variety of commercial transactions and occasionally indemnifies them against potential losses caused by the breach of those representations and warranties. The Company may also provide standard indemnifications to some counterparties to protect them in the event additional taxes are owed or payments are withheld, due either to a change in or adverse application of certain tax laws. These indemnifications generally are standard contractual terms and are entered into in the normal course of business. The maximum potential amount of future payments that the Company could be required to make under these indemnifications cannot be estimated. However, the Company believes that it is unlikely it will have to make material payments under these arrangements and has not recorded any contingent liability in the financial statements for these indemnifications. The Company is self-insured with respect to employee health claims. The Company maintains stop-loss insurance for certain risks and has a health claim reinsurance limit capped at approximately $50,000 per employee. The estimated liability for self-insurance claims is initially recorded in the year in which the event of loss occurs, and may be subsequently adjusted based upon new information and cost estimates. Reserves for losses represent estimates of reported losses and estimates of incurred but not reported losses based on past and current experience. Actual claims paid and settled may differ, perhaps significantly, from the provision for losses. This adds uncertainty to the estimated reserves for losses. Accordingly, it is at least possible that the ultimate settlement of losses may vary significantly from the amounts included in the financial statements. As part of this plan, the Company recognized expenses totaling $935,000 and $546,000 for the years ended December 31, 2018 and 2017, respectively. The Company had an accrual of $50,000 and $28,000 as of the years ended December 31, 2018 and 2017, respectively, which represents the historical estimate of future claims to be recognized for claims incurred prior to December 31, 2018 and 2017, respectively. The Company believes that its present insurance coverage and reserves are sufficient to cover currently estimated exposures, but there can be no assurance that the Company will not incur liabilities in excess of recorded reserves or in excess of its insurance limits. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2018 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plans | 10. Employee Benefit Plans The Company sponsors a defined-contribution retirement plan under Section 401(k) of the Internal Revenue Code that covers substantially all employees. Participant contributions to the plan are voluntary and are subject to certain limitations. The Company may also make discretionary contributions to the plan. No contributions were made by the Company in 2018 or 2017. |
Related Party Disclosures
Related Party Disclosures | 12 Months Ended |
Dec. 31, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Disclosures | 11. Related Party Disclosures StockCross StockCross and the Company are under common ownership and StockCross serves as one of the two clearing brokers for the Company. StockCross has a clearing agreement with MSCO in which StockCross passes through all revenue and charges MSCO for related clearing expenses. Outside of the clearing agreement, MSCO has an expense sharing agreement with StockCross for its Beverly Hills office. In addition, StockCross pays some of the vendors for miscellaneous expenses which it passes through to MSCO. Lastly, as of December 31, 2018, MSCO had receivables from StockCross totaling approximately $1.3 million consisting of financing for inventory positions, the net monthly clearing fees StockCross owes MSCO, and a clearing deposit. As of December 31, 2017, MSCO had a receivable from StockCross totaling $283,000. KCA KCA is an affiliate of the Company and StockCross. To gain efficiencies and economies of scale with billing and administrative functions, KCA serves as a paymaster for the Company and StockCross for compensation and benefits expenses, the entirety of which KCA passes through to the Company and StockCross proportionally. In addition, KCA has purchased the naming rights for the Company for the Company to use. PWC PWC brokers the insurance policies for related parties. Revenue for PWC from related parties totaled $28,000 for the year ended December 31, 2018. Scilent Networks LLC (Scilent Networks) Scilent Networks is a technology wholesaler owned by a Siebert executive that buys technology and related services on behalf of the Company at a reduced cost and then passes through the cost to the Company. Total expenses related to Scilent Networks totaled $133,000 and $112,000 for the years ended December 31, 2018 and 2017, respectively. |
Summarized Quarterly Financial
Summarized Quarterly Financial Data (unaudited) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Summarized Quarterly Financial Data (unaudited) | 12. Summarized Quarterly Financial Data (unaudited) 2018 2017 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Revenue $ 8,177,000 $ 7,488,000 $ 7,884,000 $ 6,487,000 $ 2,379,000 $ 2,689,000 $ 3,089,000 $ 4,953,000 Net income (loss) $ 1,693,000 $ 1,799,000 $ 3,119,000 $ 5,351,000 $ 58,000 $ 365,000 $ 1,001,000 $ 733,000 Net income (loss) per share: Continuing operations $ 0.06 $ 0.07 $ 0.11 $ 0.20 $ 0.00 $ 0.02 $ 0.05 $ 0.03 Discontinued operations — — — — — — — — |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements are prepared on the accrual basis of accounting in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) as established by the Financial Accounting Standards Board (“FASB”) to ensure consistent reporting of financial condition. The consolidated financial statements include the accounts of Siebert and its wholly-owned subsidiaries and upon consolidation, all intercompany balances and transactions are eliminated. The U.S. dollar is the functional currency of the Company. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The Company makes significant estimates that affect the reported amounts of assets, liabilities, revenue, and expenses. The estimates relate primarily to revenue and expenses in the normal course of business as to which the Company receives no confirmations, invoices, or other documentation at the time the books are closed. The Company uses its best judgment, based on knowledge of these revenue transactions and expenses incurred, to estimate the amount of such revenue and expenses. The Company is not aware of any material differences between the estimates used in closing the Company’s books for the last five years and the actual amounts of revenue and expenses incurred when the Company subsequently receives the actual confirmations, invoices, or other documentation. Estimates are used in intangible asset valuations and useful lives, depreciation, income taxes, and the contingent liabilities related to legal and healthcare expenses. The Company also estimates the valuation allowance relating to its deferred tax assets based on the more likely than not criteria. The Company believes that its estimates are reasonable. |
Reclassifications | Reclassifications Certain prior period amounts have been reclassified to conform to the current year’s presentation. These reclassifications have no effect on previously reported net income. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents are all cash balances that are unrestricted. The Company has defined cash equivalents as highly liquid investments, with original maturities of less than 90 days that are not held for sale in the ordinary course of business. As of the years ended December 31, 2018 and 2017, the Company did not hold any cash equivalents. |
Receivables from Clearing and Other Brokers | Receivables from Clearing and Other Brokers Retail customer transactions are cleared, on a fully disclosed basis, through two clearing brokers, StockCross and NFS, the former of which is an affiliate. The Company operates on a month to month basis with both clearing brokers and they offset their fees against the Company's revenues on a monthly basis. Receivables from clearing and other brokers include amounts receivable as well as cash on deposit. As of the years ended December 31, 2018 and 2017, cash clearing deposits with StockCross and NFS were $75,000 and $50,000, respectively. The Company evaluates receivables from clearing organizations and other brokers for collectability noting no amount was considered uncollectable as of the years ended December 31, 2018 and 2017. No valuation allowance is recognized for receivables from clearing and other brokers as the Company does not have a history of losses from receivables from clearing and other brokers and does not anticipate losses in the future. |
Furniture, Equipment and Leasehold Improvements | Furniture, Equipment and Leasehold Improvements Furniture, equipment and leasehold improvements are stated at cost, net of accumulated depreciation and amortization. Depreciation is calculated using the straight-line method over the lives of the assets, generally not exceeding four years. Leasehold improvements are amortized over the shorter of the useful life or remaining lease term unless the lease transfers ownership of the underlying asset to the lessee or lessee is reasonably certain to exercise an option to purchase the underlying asset, in which case the lessee will amortize over the useful life of the leasehold improvements. |
Software | Software The Company capitalizes certain costs for software such as the Robo-Advisor, software license arrangements with a contract term of greater than 1 year, as well as other software, and amortizes the assets over the estimated useful life of the software or contract term, generally not exceeding 3 years. The Company accounts for software license arrangements with a contract term of 1 year as prepaid assets and amortizes them over the contract term. Other software costs such as routine maintenance and various data services to provide market information to customers are expensed as incurred. |
Amortization of Intangible Assets | Amortization of Intangible Assets The Company has a finite-lived intangible asset in the Robo-Advisor acquired from KCAT. Intangible assets with finite lives are amortized on a straight-line basis over their estimated useful lives. The Company acquired the Robo-Advisor from KCAT in August 2018. The Robo-Advisor has an estimated useful life of 3 years and the Company will start to amortize it in 2019. |
Advertising Costs | Advertising Costs Advertising costs are expensed as incurred and totaled $45,000 and $87,000 for the years ended December 31, 2018 and 2017, respectively. |
Revenue Recognition and Other Income | Revenue Recognition and Other Income On January 1, 2018, the Company adopted the new revenue recognition standard ASC 606, Revenue from Contracts with Customers, on the modified retrospective method (i.e., cumulative method). The Company has elected the modified retrospective method which did not result in a cumulative-effect adjustment at the date of adoption. The implementation of this new standard had no material impact on the Company's consolidated financial statements for the years ended December 31, 2018 and 2017. Revenue from contracts with customers includes commissions and fees, principal transactions and advisory fees. The recognition and measurement of revenue is based on the assessment of individual contract terms. Significant judgment is required to determine whether performance obligations are satisfied at a point in time or over time; how to allocate transaction prices where multiple performance obligations are identified; when to recognize revenue based on the appropriate measure of the Company’s progress under the contract; and whether constraints on variable consideration should be applied due to uncertain future events. The primary sources of revenue for the Company are as follows: Margin Interest, Marketing and Distribution fees Margin interest, marketing and distribution fees consists of two components: margin interest and 12b1 fees. Margin interest is the net interest charged to customers for holding financed margin positions, and 12b1 fees are fees paid to the Company related to trailing payments from mutual funds as a result of prior sales of mutual funds to customers. Margin interest, marketing and distribution fees are recorded as earned. Principal Transactions Principal transactions primarily represent riskless transactions in which the Company, after executing a solicited order, buys or sells securities as principal and at the same time buys or sells the securities with a markup or markdown to satisfy the order. Principal transactions are recognized at a point in time on the trade date when the performance obligation is satisfied. The performance obligation is satisfied on the trade date because that is when the underlying financial instrument or purchaser is identified, the pricing is agreed upon and the risks and rewards of ownership have been transferred to/from the customer. Commissions and Fees The Company earns commission revenue for executing trades for clients in individual equities, options, insurance products, futures, fixed income securities, as well as certain third party mutual funds and ETFs. Commission revenue associated with combined trade execution and clearing services, as well as trade execution services on a standalone basis, is recognized at a point in time on the trade date when the performance obligation is satisfied. The performance obligation is satisfied on the trade date because that is when the underlying financial instrument or purchaser is identified, the pricing is agreed upon and the risks and rewards of ownership have been transferred to/from the customer. Advisory Fees The Company earns advisory fees associated with managing client assets. The performance obligation related to its revenue stream is satisfied over time; however, the advisory fees are variable as they are charged as a percentage of the client’s total asset value, which is determined at the end of the quarter. The following table presents the major revenue categories and when each category is recognized: Year Ended December 31, Revenue Category 2018 2017 Timing of Recognition Trading Execution and Clearing Services Commissions and fees $ 9,504,000 $ 4,801,000 Recorded on trade date Principal transactions $ 9,020,000 $ 1,639,000 Recorded on trade date Advisory fees and additional income $ 584,000 $ 70,000 Recorded as earned Other Income Margin interest, marketing and distribution fees Margin interest $ 7,663,000 $ 3,726,000 Recorded as earned 12b1 fees 3,265,000 2,874,000 Recorded as earned Total Margin interest, marketing and distribution fees $ 10,928,000 $ 6,600,000 Total Revenue $ 30,036,000 $ 13,110,000 The following table presents each revenue category and its related performance obligation: Revenue Stream Performance Obligation Principal transactions, Commissions and fees, Advisory fees and additional income Provide security trading services to customer and act as agent Margin interest, marketing and distribution fees n/a Disaggregation of Revenue The following table presents a breakdown of the Company’s revenue between the amounts attributed to the legacy Siebert customer base vs. the accounts acquired from the StockCross Retail Assets: Year Ended December 31, 2018 2017 Revenue from Principal transactions: Principal transactions – Legacy Siebert $ 1,894,000 $ 490,000 Principal transactions – StockCross Retail Assets 7,126,000 1,149,000 Total Revenue from Principal transactions $ 9,020,000 $ 1,639,000 Revenue from Commissions and fees: Commissions and fees – Legacy Siebert $ 7,792,000 $ 4,527,000 Commissions and fees – StockCross Retail Assets 1,712,000 274,000 Total Revenue from Commissions and fees $ 9,504,000 $ 4,801,000 Revenue from Margin interest, marketing and distribution fees: Margin interest, marketing and distribution fees – Legacy Siebert $ 9,674,000 $ 6,409,000 Margin interest, marketing and distribution fees – StockCross Retail Assets 1,254,000 191,000 Total Revenue from Margin interest, marketing and distribution fees $ 10,928,000 $ 6,600,000 Additional Revenue: Advisory fees – Legacy Siebert 478,000 51,000 Interest – Legacy Siebert 106,000 19,000 Total Revenue $ 30,036,000 $ 13,110,000 |
Income Taxes | Income Taxes The results of operations are included in the consolidated federal income tax return of the Company as well as the consolidated or standalone state and local income tax returns of the Company and/or its subsidiaries. The amount of current and deferred taxes payable or refundable is recognized as of the date of the financial statements, utilizing currently enacted tax laws and rates. Deferred tax expenses or benefits are recognized in the financial statements for the changes in deferred tax liabilities or assets between years. The Company records accruals for uncertain tax positions when the Company believes that it is not more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. The Company makes adjustments to these accruals when facts and circumstances change, such as the closing of a tax audit or the refinement of an estimate. The Company had no uncertain tax positions as of December 31, 2018 and 2017. The Company recognizes deferred tax assets to the extent that the Company believes these assets are more likely than not to be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversal of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. To the extent the Company determines that realization of deferred tax assets is not "more likely than not," the Company establishes a valuation allowance. As a result, the amount of the deferred tax assets considered realizable could be reduced in the near term if estimates of future taxable income are reduced. Such an occurrence could materially impact the Company’s results of operations and financial condition. |
Evaluation of Subsequent Events | Evaluation of Subsequent Events The Company has evaluated events that have occurred subsequent to December 31, 2018 and through March 26, 2019, the date of the filing of this report. As previously disclosed in a Current Report on Form 8-K on January 18, 2019, the Company purchased approximately 15% of StockCross’ outstanding shares. The number of shares purchased by the Company was 922,875 at a per share price of approximately $3.97. There have been no additional material subsequent events that occurred during such period that would require disclosure in this report or would be required to be recognized in the financial statements as of December 31, 2018. |
Capital Stock | Capital Stock The authorized capital stock of the Company consists of a single class of common stock. |
Per Share Data | Per Share Data Basic earnings (loss) per share is calculated by dividing net income (loss) by the weighted average outstanding common shares during the year. Diluted earnings per share is calculated by dividing net income by the number of shares outstanding under the basic calculation and adding, all dilutive securities, which consist of options. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements ASU 2016-02 |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements ASU 2014-09 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Accounting Policies [Abstract] | |
Schedule of Major Revenue Categories | The following table presents the major revenue categories and when each category is recognized: Year Ended December 31, Revenue Category 2018 2017 Timing of Recognition Trading Execution and Clearing Services Commissions and fees $ 9,504,000 $ 4,801,000 Recorded on trade date Principal transactions $ 9,020,000 $ 1,639,000 Recorded on trade date Advisory fees and additional income $ 584,000 $ 70,000 Recorded as earned Other Income Margin interest, marketing and distribution fees Margin interest $ 7,663,000 $ 3,726,000 Recorded as earned 12b1 fees 3,265,000 2,874,000 Recorded as earned Total Margin interest, marketing and distribution fees $ 10,928,000 $ 6,600,000 Total Revenue $ 30,036,000 $ 13,110,000 |
Schedule of Revenue Categories and Remaining Performance Obligations | The following table presents each revenue category and its related performance obligation: Revenue Stream Performance Obligation Principal transactions, Commissions and fees, Advisory fees and additional income Provide security trading services to customer and act as agent Margin interest, marketing and distribution fees n/a |
Schedule of Disaggregation of Revenue | The following table presents a breakdown of the Company’s revenue between the amounts attributed to the legacy Siebert customer base vs. the accounts acquired from the StockCross Retail Assets: Year Ended December 31, 2018 2017 Revenue from Principal transactions: Principal transactions – Legacy Siebert $ 1,894,000 $ 490,000 Principal transactions – StockCross Retail Assets 7,126,000 1,149,000 Total Revenue from Principal transactions $ 9,020,000 $ 1,639,000 Revenue from Commissions and fees: Commissions and fees – Legacy Siebert $ 7,792,000 $ 4,527,000 Commissions and fees – StockCross Retail Assets 1,712,000 274,000 Total Revenue from Commissions and fees $ 9,504,000 $ 4,801,000 Revenue from Margin interest, marketing and distribution fees: Margin interest, marketing and distribution fees – Legacy Siebert $ 9,674,000 $ 6,409,000 Margin interest, marketing and distribution fees – StockCross Retail Assets 1,254,000 191,000 Total Revenue from Margin interest, marketing and distribution fees $ 10,928,000 $ 6,600,000 Additional Revenue: Advisory fees – Legacy Siebert 478,000 51,000 Interest – Legacy Siebert 106,000 19,000 Total Revenue $ 30,036,000 $ 13,110,000 |
Receivables from and Payable _2
Receivables from and Payable to Brokers, Dealers, and Clearing Organizations (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Due to and from Broker-Dealers and Clearing Organizations [Abstract] | |
Schedule of Amounts Receivable From / Payable to Brokers, Dealers and Clearing Organizations | Amounts receivable from / payable to brokers, dealers and clearing organizations consisted of the following as of the periods indicated: As of December 31, 2018 2017 Receivables from clearing and other brokers NFS $ 1,664,000 $ 1,396,000 StockCross 310,000 — Other receivables 31,000 — Citibank 25,000 — Total Receivables from clearing and other brokers $ 2,030,000 $ 1,396,000 Receivable from related party StockCross $ 1,000,000 $ 283,000 Total Receivable from related party $ 1,000,000 $ 283,000 Due to clearing brokers and related parties NFS $ 58,000 $ — StockCross 46,000 127.000 MSCO 29,000 — Total Due to clearing brokers and related parties $ 133,000 $ 127,000 |
Furniture, Equipment and Leas_2
Furniture, Equipment and Leasehold Improvements, Net (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Furniture, equipment and leasehold improvements | Furniture, equipment and leasehold improvements consisted of the following as of the periods indicated: As of December 31, 2018 2017 Leasehold improvements $ 545,000 $ 267,000 Equipment 52,000 52,000 Total Furniture, equipment, and leasehold improvements 597,000 319,000 Less accumulated depreciation and amortization (129,000 ) (56,000 ) Total Furniture, equipment, and leasehold improvements, net $ 468,000 $ 263,000 |
Software, Net (Tables)
Software, Net (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Software, Net | Software consisted of the following as of the periods indicated: As of December 31, 2018 2017 Intangible asset – Robo-Advisor $ 763,000 $ — Other purchased software 459,000 97,000 Total Software 1,222,000 97,000 Less accumulated amortization – Robo-Advisor — — Less accumulated amortization – Other purchased software (85,000 ) (13,000 ) Total Software, net $ 1,137,000 $ 84,000 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income Tax (Benefit) / Expense | Deferred income tax (benefit) / expense, which represents the net change in the deferred tax assets or liability balance during the year, including any change in the valuation allowance. Year Ending December 31, 2018 2017 Current Federal $ 948,000 $ 51,000 State and local 26,000 102,000 Total Current $ 974,000 $ 153,000 Deferred Federal $ (3,248,000 ) $ — State and local (2,328,000 ) — Total Deferred $ (5,576,000 ) $ — Total Income tax (benefit) / expense $ (4,602,000 ) $ 153,000 |
Schedule of Reconciliation of U.S. Federal Statutory Income Tax Rate | A reconciliation of the U.S. federal statutory income tax rate to the effective tax rate applicable to income before income taxes is as follows for the periods indicated: Year Ending December 31, 2018 2017 Federal statutory income tax rate 21.0 % 34.0 % Net effect of: Non-deductible expenses 0.2 % 1.2 % Depreciation (0.9 %) (4.5 %) Tax amortization of intangible assets (3.8 %) (1.6 %) Other temporary differences (1.3 %) (12.1 %) Net operating loss (2.6 %) (13.2 %) Increase due to state and local taxes, net of U.S. federal income tax effects 0.6 % 2.8 % Total Current effective income tax rate 13.2 % 6.6 % Reversal of deferred tax assets valuation allowance (75.8 %) — Total Effective income tax rate (62.6 %) 6.6 % |
Schedule of Deferred Tax Assets (Liabilities) | Below is a breakout of the deferred tax assets, net of valuation allowance as of the periods indicated. Prior period amounts were adjusted to reflect the impact from the Tax Cuts and Jobs Act: As of December 31, 2018 2017 Deferred tax assets Net operating loss carryforwards $ 5,811,000 $ 6,596,000 $ 5,811,000 $ 6,596,000 Deferred tax liabilities Furniture, equipment and leasehold improvements $ (193,000 ) $ (79,000 ) Contribution carryover — 126,000 Intangible assets — (25,000 ) Other reconciling items (42,000 ) — $ (235,000 ) $ 22,000 Total $ 5,576,000 $ 6,618,000 Valuation allowance — (6,618,000 ) Deferred tax assets, net of valuation allowance $ 5,576,000 $ — |
Commitments, Contingencies an_2
Commitments, Contingencies and Other (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Commitments Contingencies And Other Tables | |
Schedule of Future Minimum Rental Payments for Operating Leases | Future annual minimum base rental payments under these operating leases are as follows as of December 31, 2018: Year Amount 2019 $ 686,000 2020 651,000 2021 628,000 2022 489,000 2023 and thereafter 507,000 Total $ 2,961,000 |
Summarized Quarterly Financia_2
Summarized Quarterly Financial Data (unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Summarized quarterly financial data | 2018 2017 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Revenue $ 8,177,000 $ 7,488,000 $ 7,884,000 $ 6,487,000 $ 2,379,000 $ 2,689,000 $ 3,089,000 $ 4,953,000 Net income (loss) $ 1,693,000 $ 1,799,000 $ 3,119,000 $ 5,351,000 $ 58,000 $ 365,000 $ 1,001,000 $ 733,000 Net income (loss) per share: Continuing operations $ 0.06 $ 0.07 $ 0.11 $ 0.20 $ 0.00 $ 0.02 $ 0.05 $ 0.03 Discontinued operations — — — — — — — — |
Organization (Details)
Organization (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |
Aug. 21, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Business Acquisition [Line Items] | |||
Common stock, par value | $ 0.01 | $ 0.01 | |
Shares issued in acquisition, value | $ 19,984,000 | ||
Kennedy Cabot Acquisition Technology [Member] | |||
Business Acquisition [Line Items] | |||
Total consideration of acquisition | $ 690,000 | ||
PWC Acquisition [Member] | |||
Business Acquisition [Line Items] | |||
Total consideration of acquisition | $ 110,000 | ||
Acquisition of StockCross [Member] | |||
Business Acquisition [Line Items] | |||
Shares issued in acquisition | 5,072,062 | ||
Shares issued in acquisition, value | $ 19,984,000 | ||
Legal and appraisal fees | 125,000 | ||
Book value of assets acquired | |||
Fair market value of assets acquired | $ 19,984,000 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Narrative) (Details) - USD ($) | 1 Months Ended | 12 Months Ended | ||
Jan. 18, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Estimated useful life of software | 3 years | |||
Advertising costs | $ 45,000 | $ 87,000 | ||
Robo-Advisor [Member] | ||||
Estimated useful life of software | 3 years | |||
Robo-Advisor [Member] | Subsequent Event [Member] | ||||
Estimated useful life of software | 3 years | |||
Prepaid assets [Member] | ||||
Estimated useful life of software | 1 year | |||
StockCross [Member] | ||||
Cash clearing deposits | $ 75,000 | 75,000 | ||
StockCross [Member] | Subsequent Event [Member] | ||||
Percentage of shares purchased | 15.00% | |||
Number of shares purchased | 922,875 | |||
Number of shares purchased, price per share | $ 3.97 | |||
NFS [Member] | ||||
Cash clearing deposits | $ 50,000 | $ 50,000 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Schedule of Major Revenue Categories) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | |
Trading Execution and Clearing Services | ||||||||||
Commissions and fees | $ 9,504,000 | $ 4,801,000 | ||||||||
Principal transactions | 9,020,000 | 1,639,000 | ||||||||
Advisory fees and additional income | 584,000 | 70,000 | ||||||||
Margin interest, marketing and distribution fees | ||||||||||
Margin interest | 7,663,000 | 3,726,000 | ||||||||
12b1 fees | 3,265,000 | 2,874,000 | ||||||||
Total Margin interest, marketing and distribution fees | 10,928,000 | 6,600,000 | ||||||||
Total Revenue | $ 6,487,000 | $ 7,884,000 | $ 7,488,000 | $ 8,177,000 | $ 4,953,000 | $ 3,089,000 | $ 2,689,000 | $ 2,379,000 | $ 30,036,000 | $ 13,110,000 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies (Schedule of Disaggregation of Revenue) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenue from Principal transactions: | ||||||||||
Principal transactions - Legacy Siebert | $ 1,894,000 | $ 490,000 | ||||||||
Principal transactions - StockCross Retail Assets | 7,126,000 | 1,149,000 | ||||||||
Total Revenue from Principal transactions | 9,020,000 | 1,639,000 | ||||||||
Revenue from Commissions and fees: | ||||||||||
Commissions and fees - Legacy Siebert | 7,792,000 | 4,527,000 | ||||||||
Commissions and fees - StockCross Retail Assets | 1,712,000 | 274,000 | ||||||||
Total Revenue from Commissions and fees | 9,504,000 | 4,801,000 | ||||||||
Revenue from Margin interest, marketing and distribution fees: | ||||||||||
Margin interest, marketing and distribution fees - Legacy Siebert | 9,674,000 | 6,409,000 | ||||||||
Margin interest, marketing and distribution fees - StockCross Retail Assets | 1,254,000 | 191,000 | ||||||||
Total Revenue from Margin interest, marketing and distribution fees | 10,928,000 | 6,600,000 | ||||||||
Additional Revenue: | ||||||||||
Advisory fees - Legacy Siebert | 478,000 | 51,000 | ||||||||
Interest - Legacy Siebert | 106,000 | 19,000 | ||||||||
Total Revenue | $ 6,487,000 | $ 7,884,000 | $ 7,488,000 | $ 8,177,000 | $ 4,953,000 | $ 3,089,000 | $ 2,689,000 | $ 2,379,000 | $ 30,036,000 | $ 13,110,000 |
Receivables from and Payable _3
Receivables from and Payable to Brokers, Dealers, and Clearing Organizations (Schedule of Amounts Receivable) (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Receivables from clearing and other brokers | ||
NFS | $ 1,664,000 | $ 1,396,000 |
StockCross | 310,000 | |
Other receivables | 31,000 | |
Citibank | 25,000 | |
Total Receivables from clearing and other brokers | 2,030,000 | 1,396,000 |
Receivable from related party | ||
StockCross | 1,000,000 | 283,000 |
Total Receivable from related party | 1,000,000 | 283,000 |
Due to clearing brokers and related parties | ||
NFS | 58,000 | |
StockCross | 46,000 | 127,000 |
MSCO | 29,000 | |
Total Due to clearing brokers and related parties | $ 133,000 | $ 127,000 |
Furniture, Equipment and Leas_3
Furniture, Equipment and Leasehold Improvements, Net (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Property, Plant and Equipment [Abstract] | ||
Leasehold improvements | $ 545,000 | $ 267,000 |
Equipment | 52,000 | 52,000 |
Total Furniture, equipment and leasehold improvements | 597,000 | 319,000 |
Less accumulated depreciation and amortization | (129,000) | (56,000) |
Total Furniture, equipment and leasehold improvements, net | $ 468,000 | $ 263,000 |
Software, Net (Narrative) (Deta
Software, Net (Narrative) (Details) | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Estimated useful life of software | 3 years |
Future amortization expense related to software in 2019 | $ 398,000 |
Future amortization expense related to software in 2020 | 398,000 |
Future amortization expense related to software in 2021 | $ 341,000 |
Software, Net (Schedule of Soft
Software, Net (Schedule of Software, Net) (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Finite-Lived Intangible Assets [Line Items] | ||
Total Software | $ 1,222,000 | $ 97,000 |
Total Software, net | 1,137,000 | 84,000 |
Robo-Advisor [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total Software | 763,000 | |
Less accumulated amortization | ||
Other purchased software [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total Software | 459,000 | 97,000 |
Less accumulated amortization | $ (85,000) | $ (13,000) |
Income Taxes (Schedule of Incom
Income Taxes (Schedule of Income Tax (Benefit) / Expense) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Current | ||
Federal | $ 948,000 | $ 51,000 |
State and local | 26,000 | 102,000 |
Total Current | 974,000 | 153,000 |
Deferred | ||
Federal | (3,248,000) | |
State and local | (2,328,000) | |
Total Deferred | (5,576,000) | |
Total Income tax (benefit) / expense | $ (4,602,000) | $ 153,000 |
Income Taxes (Schedule of Recon
Income Taxes (Schedule of Reconciliation of U.S. Federal Statutory Income Tax Rate) (Details) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | ||
Federal statutory income tax rate | 21.00% | 34.00% |
Net effect of: | ||
Non-deductible expenses | 0.20% | 1.20% |
Depreciation | (0.90%) | (4.50%) |
Tax amortization of intangible assets | (3.80%) | (1.60%) |
Other temporary differences | (1.30%) | (12.10%) |
Net operating loss | (2.60%) | (13.20%) |
Increase due to state and local taxes, net of U.S. federal income tax effects | 0.60% | 2.80% |
Total Current effective income tax rate | 13.20% | 6.60% |
Reversal of deferred tax assets valuation allowance | (75.80%) | |
Total Effective income tax rate | (62.60%) | 6.60% |
Income Taxes (Schedule of Defer
Income Taxes (Schedule of Deferred Tax Assets (Liabilities)) (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 |
Deferred tax assets | ||
Net operating loss carryforwards | $ 5,811,000 | $ 6,596,000 |
Total Deferred tax assets | 5,811,000 | 6,596,000 |
Deferred tax liabilities | ||
Furniture, equipment and leasehold improvements | (193,000) | (79,000) |
Contribution carryover | 126,000 | |
Intangible assets | (25,000) | |
Other reconciling items | (42,000) | |
Deferred tax liabilities | (235,000) | 22,000 |
Total | 5,576,000 | 6,618,000 |
Valuation allowance | (6,618,000) | |
Deferred tax assets, net of valuation allowance | $ 5,576,000 |
Capital Requirements (Narrative
Capital Requirements (Narrative) (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Assets | $ 18,177,000 | $ 6,025,000 | |
Cash and cash equivalents | 7,229,000 | 3,765,000 | $ 2,730,000 |
MSCO [Member] | |||
Net capital | 8,900,000 | 4,400,000 | |
Minimum net capital required | 250,000 | 250,000 | |
Net capital in excess of minimum requirement | $ 8,700,000 | $ 4,200,000 |
Commitments, Contingencies an_3
Commitments, Contingencies and Other (Narrative) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Rent expense | $ 988,000 | $ 437,000 |
Receivable from landlord | 171,000 | |
Health claim reinsurance limit per employee | 50,000 | |
Expense for self-insurance claims | 935,000 | 546,000 |
Accrual for self-insurance claims | $ 50,000 | $ 28,000 |
Commitments, Contingencies an_4
Commitments, Contingencies and Other (Schedule of Future Minimum Rental Payments for Operating Leases) (Details) | Dec. 31, 2018USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2019 | $ 686,000 |
2020 | 651,000 |
2021 | 628,000 |
2022 | 489,000 |
2023 and thereafter | 507,000 |
Total | $ 2,961,000 |
Related Party Disclosures (Deta
Related Party Disclosures (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Related Party Transaction [Line Items] | ||
Due from Stockcross to MSCO | $ 310,000 | |
Related party expenses | 803,000 | |
Receivable from StockCross | 1,000,000 | 283,000 |
PWC [Member] | ||
Related Party Transaction [Line Items] | ||
Related party revenues | 28,000 | |
Scilent Networks [Member] | ||
Related Party Transaction [Line Items] | ||
Related party expenses | $ 133,000 | $ 112,000 |
Summarized Quarterly Financia_3
Summarized Quarterly Financial Data (unaudited) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | |
Summarized Quarterly Financial Data Details | ||||||||||
Revenue | $ 6,487,000 | $ 7,884,000 | $ 7,488,000 | $ 8,177,000 | $ 4,953,000 | $ 3,089,000 | $ 2,689,000 | $ 2,379,000 | $ 30,036,000 | $ 13,110,000 |
Net income (loss) | $ 5,351,000 | $ 3,119,000 | $ 1,799,000 | $ 1,693,000 | $ 733,000 | $ 1,001,000 | $ 365,000 | $ 58,000 | $ 11,962,000 | $ 2,157,000 |
Net income (loss) per share: | ||||||||||
Continuing operations | $ 0.20 | $ 0.11 | $ 0.07 | $ 0.06 | $ 0.03 | $ 0.05 | $ 0.02 | $ 0 | ||
Discontinued operations |