THE BEAR STEARNS COMPANIES INC.
-------------------------------
SEGMENT DATA
------------
(UNAUDITED)
-----------
Percentage Percentage
Three Months Ended Change From Twelve Months Ended Change
-------------------------------------- ------------------------ ------------------------- ------
November 30, November 30, August 31, November 30, August 31, November 30, November 30,
2001 2000 2001 2000 2001 2001 2000
----------- ----------- --------- ----------- --------- ----------- -----------
NET REVENUES (In thousands) (In thousands)
Capital Markets
Institutional Equities $ 232,181 $ 296,859 $ 244,741 (22%) (5%) $ 1,166,443 $ 1,452,292 (20%)
Fixed Income 331,231 340,962 416,128 (3%) (20%) 1,602,034 1,092,568 47%
Investment Banking 227,372 229,004 213,458 (1%) 7% 717,154 965,379 (26%)
----------- ----------- ----------- ----------- -----------
Total Capital Markets 790,784 866,825 874,327 (9%) (10%) 3,485,631 3,510,239 (1%)
Global Clearing Services 187,297 277,765 192,021 (33%) (2%) 810,601 1,074,498 (25%)
Wealth Management 136,963 159,061 128,027 (14%) 7% 543,495 683,791 (21%)
Other (a) 4,788 73,177 10,383 (93%) (54%) 67,308 207,150 (68%)
----------- ----------- ----------- ----------- -----------
Total net revenues $ 1,119,832 $ 1,376,828 $ 1,204,758 (19%) (7%) $ 4,907,035 $ 5,475,678 (10%)
=========== =========== =========== =========== ===========
PRE-TAX INCOME
Capital Markets $ 206,465 $ 206,395 $ 196,028 0% 5% $ 867,166 $ 899,101 (4%)
Global Clearing Services 61,511 109,530 43,251 (44%) 42% 249,754 466,217 (46%)
Wealth Management 10,151 20,640 9,750 (51%) 4% 40,314 127,856 (68%)
Other (a) (68,162) (54,247) (44,343) (26%) (54%) (222,790) (321,651) 31%
----------- ----------- ----------- ----------- -----------
Total pre-tax income $ 209,965 $ 282,318 $ 204,686 (26%) 3% $ 934,444 $ 1,171,523 (20%)
=========== =========== =========== =========== ===========
(a) Other is comprised of consolidation/elimination entries, unallocated
revenues (predominantly interest) and certain corporate administrative
functions, including an accrual related to a litigation charge for the twelve
months ended November 30, 2000 and costs related to the Capital Accumulation
Plan (the "CAP Plan") for Senior Managing Directors.
Note: Certain reclassifications have been made to prior period amounts to
conform to the current period's presentation.
13
THE BEAR STEARNS COMPANIES INC.
-------------------------------
CONSOLIDATED STATEMENTS OF INCOME
---------------------------------
(UNAUDITED)
-----------
Three Months Ended Twelve Months Ended
------------------------------ ----------------------------
November 30, November 30, November 30, November 30,
2001 2000 2001 2000
----------- ----------- ----------- -----------
(In thousands, except share and per share data)
REVENUES
Commissions $ 276,605 $ 312,979 $ 1,116,731 $ 1,207,122
Principal transactions 419,501 558,505 2,282,797 2,225,018
Investment banking 240,396 241,024 772,125 1,021,969
Interest and dividends 803,094 1,504,096 4,339,298 5,642,361
Other income 74,074 46,862 190,082 151,494
----------- ----------- ----------- -----------
Total revenues 1,813,670 2,663,466 8,701,033 10,247,964
Interest expense 693,838 1,286,638 3,793,998 4,772,286
----------- ----------- ----------- -----------
Revenues, net of interest expense 1,119,832 1,376,828 4,907,035 5,475,678
----------- ----------- ----------- -----------
NON-INTEREST EXPENSES
Employee compensation and benefits 523,052 719,115 2,528,852 2,788,638
Floor brokerage, exchange and clearance fees 42,925 41,150 161,363 158,940
Communications and technology 111,917 122,156 453,261 449,691
Occupancy 37,587 34,759 146,620 134,596
Advertising and market development 25,690 33,374 126,669 125,153
Professional fees 42,522 70,279 175,249 190,871
Other expenses 126,174 73,677 380,577 456,266
----------- ----------- ----------- -----------
Total non-interest expenses 909,867 1,094,510 3,972,591 4,304,155
----------- ----------- ----------- -----------
Income before provision for income taxes and
cumulative effect of change in accounting principle 209,965 282,318 934,444 1,171,523
Provision for income taxes 55,019 87,129 309,479 398,340
----------- ----------- ----------- -----------
Income before cumulative effect of change in
accounting principle 154,946 195,189 624,965 773,183
Cumulative effect of change in accounting principle,
net of tax - - (6,273) -
----------- ----------- ----------- -----------
Net income $ 154,946 $ 195,189 $ 618,692 $ 773,183
=========== =========== =========== ===========
Net income applicable to common shares $ 145,168 $ 185,411 $ 579,579 $ 734,070
=========== =========== =========== ===========
Adjusted net income used for diluted earnings
per share (1) $ 157,118 $ 201,625 $ 649,573 $ 813,554
=========== =========== =========== ===========
Basic earnings per share $ 1.14 $ 1.37 $ 4.49(2) $ 5.37
=========== =========== =========== ===========
Diluted earnings per share $ 1.08 $ 1.36 $ 4.27(2) $ 5.35
=========== =========== =========== ===========
Weighted average number of common shares outstanding:
Basic 136,671,817 147,585,214 142,643,018 151,437,116
=========== =========== =========== ===========
Diluted 145,040,061 148,697,431 152,216,936 152,034,249
=========== =========== =========== ===========
Cash dividends declared per common share $ 0.15 $ 0.15 $ 0.60 $ 0.55
=========== =========== =========== ===========
(1) Represents net income reduced for preferred stock dividends and increased
for costs related to the CAP Plan. For earnings per share, the costs related to
the CAP Plan (net of tax) are added back as the shares related to the CAP Plan
are included in weighted average shares outstanding.
(2) Amount reflects earnings per share after change in accounting principle.
Basic earnings per share and diluted earnings per share before the change in
accounting principle were $4.53 and $4.31, respectively.
Note: Certain reclassifications have been made to prior period amounts to
conform to the current period's presentation.
14
THE BEAR STEARNS COMPANIES INC.
-------------------------------
CONSOLIDATED STATEMENTS OF INCOME
---------------------------------
(UNAUDITED)
-----------
Three Months Ended
-------------------------------------
November 30, August 31,
2001 2001
----------- -----------
(In thousands, except share and per share data)
REVENUES
Commissions $ 276,605 $ 266,958
Principal transactions 419,501 551,156
Investment banking 240,396 212,015
Interest and dividends 803,094 1,233,861
Other income 74,074 37,815
----------- -----------
Total revenues 1,813,670 2,301,805
Interest expense 693,838 1,097,047
----------- -----------
Revenues, net of interest expense 1,119,832 1,204,758
----------- -----------
NON-INTEREST EXPENSES
Employee compensation and benefits 523,052 635,034
Floor brokerage, exchange and clearance fees 42,925 41,773
Communications and technology 111,917 112,806
Occupancy 37,587 40,483
Advertising and market development 25,690 33,442
Professional fees 42,522 47,446
Other expenses 126,174 89,088
----------- -----------
Total non-interest expenses 909,867 1,000,072
----------- -----------
Income before provision for income taxes 209,965 204,686
Provision for income taxes 55,019 70,114
----------- -----------
Net income $ 154,946 $ 134,572
=========== ===========
Net income applicable to common shares $ 145,168 $ 124,794
=========== ===========
Adjusted net income used for diluted earnings per share (1) $ 157,118 $ 141,866
=========== ===========
Basic earnings per share $ 1.14 $ 1.00
=========== ===========
Diluted earnings per share $ 1.08 $ 0.95
=========== ===========
Weighted average number of common shares outstanding:
Basic 136,671,817 140,331,572
=========== ===========
Diluted 145,040,061 149,056,301
=========== ===========
Cash dividends declared per common share $ 0.15 $ 0.15
=========== ===========
(1) Represents net income reduced for preferred stock dividends and increased
for costs related to the CAP Plan. For earnings per share, the costs related to
the CAP Plan (net of tax) are added back as the shares related to the CAP Plan
are included in weighted average shares outstanding.
15
THE BEAR STEARNS COMPANIES INC.
-------------------------------
SELECTED FINANCIAL INFORMATION
------------------------------
(UNAUDITED)
-----------
(In thousands, except per share amounts and Other Data)
-------------------------------------------------------
Twelve Months Ended
-----------------------------
November 30, November 30,
2001 2000
------------ ------------
Income Statement
- ----------------
Revenues, net of interest expense $ 4,907,035 $ 5,475,678
Net income $ 618,692 $ 773,183
Net income applicable to common shares $ 579,579 $ 734,070
Adjusted net income used for diluted earnings per share $ 649,573 $ 813,554
Earnings per common share:
Basic $ 4.49 (1) $ 5.37
Diluted $ 4.27 (1) $ 5.35
Financial Ratios
- ----------------
Return on average common equity (annualized) 13.7% 19.1%
Adjusted pre-tax profit margin (2) 21.5% 24.0%
Pre-tax profit margin (3) 19.0% 21.4%
After-tax profit margin (4) 12.6% 14.1%
Compensation & benefits/Revenues, net of interest expense 51.5% 50.9%
Balance Sheet
- -------------
Stockholders' equity, at period end $ 5,628,527 $ 5,654,288
Total stockholders' equity and trust issued preferred
securities, at period end $ 6,391,027 $ 6,154,288
Total capital, at period end $29,820,080 $26,250,176
Book value per common share, at period end $ 33.84 $ 31.51
Other Data (in millions, except share and employee data)
- --------------------------------------------------------
Margin debit balances, at period end $ 34,300 $ 41,900
Margin debit balances, average for period $ 39,300 $ 56,400
Customer short balances, at period end $ 55,000 $ 57,200
Customer short balances, average for period $ 51,700 $ 61,600
Stock borrowed, at period end $ 38,700 $ 49,300
Stock borrowed, average for period $ 46,900 $ 52,100
Free credit balances, at period end $ 18,100 $ 16,500
Free credit balances, average for period $ 18,700 $ 15,000
Assets under management, at period end $ 24,200 $ 19,500
Employees, at period end 10,452 11,201
Common shares and common share equivalents outstanding,
at period end 146,465,210 158,039,960
Weighted average number of common shares outstanding:
Basic 142,643,018 151,437,116
Diluted 152,216,936 152,034,249
Quarters Ended
--------------------------------------------------------------
November 30, August 31, May 25, February 23,
2001 2001 2001 2001
------------- ------------ ------------ -------------
Income Statement
- ----------------
Revenues, net of interest expense $ 1,119,832 $ 1,204,758 $ 1,368,658 $ 1,213,787
Net income $ 154,946 $ 134,572 $ 169,493 $ 159,681
Net income applicable to common shares $ 145,168 $ 124,794 $ 159,715 $ 149,903
Adjusted net income used for diluted earnings per share $ 157,118 $ 141,866 $ 183,046 $ 167,544
Earnings per common share:
Basic $ 1.14 $ 1.00 $ 1.23 $ 1.11 (1)
Diluted $ 1.08 $ 0.95 $ 1.18 $ 1.06 (1)
Financial Ratios
- ----------------
Return on average common equity (annualized) 13.9% 12.2% 15.0% 13.6%
Adjusted pre-tax profit margin (2) 20.6% 19.5% 22.5% 23.4%
Pre-tax profit margin (3) 18.7% 17.0% 19.5% 20.8%
After-tax profit margin (4) 13.8% 11.2% 12.4% 13.2%
Compensation & benefits/Revenues, net of interest expense 46.7% 52.7% 53.7% 52.3%
Balance Sheet
- -------------
Stockholders' equity, at period end $ 5,628,527 $ 5,148,394 $ 5,534,723 $ 5,621,405
Total stockholders' equity and trust issued preferred
securities, at period end $ 6,391,027 $ 5,910,894 $ 6,297,223 $ 6,121,405
Total capital, at period end $29,820,080 $28,655,969 $27,566,286 $25,768,270
Book value per common share, at period end $ 33.84 $ 32.34 $ 32.57 $ 31.94
Other Data (in millions, except share and employee data)
- --------------------------------------------------------
Margin debit balances, at period end $ 34,300 $ 34,600 $ 42,200 $ 37,600
Margin debit balances, average for period $ 32,500 $ 38,300 $ 37,800 $ 42,000
Customer short balances, at period end $ 55,000 $ 53,000 $ 61,400 $ 53,800
Customer short balances, average for period $ 45,200 $ 49,800 $ 50,600 $ 55,000
Stock borrowed, at period end $ 38,700 $ 39,300 $ 45,900 $ 41,400
Stock borrowed, average for period $ 43,500 $ 46,100 $ 45,400 $ 49,300
Free credit balances, at period end $ 18,100 $ 20,300 $ 15,900 $ 17,300
Free credit balances, average for period $ 21,400 $ 19,700 $ 17,900 $ 18,300
Assets under management, at period end $ 24,200 $ 23,500 $ 22,600 $ 21,500
Employees, at period end 10,452 11,147 10,855 11,298
Common shares and common share equivalents outstanding,
at period end 146,465,210 149,669,365 156,485,942 159,125,959
Weighted average number of common shares outstanding:
Basic 136,671,817 140,331,572 145,455,590 149,080,028
Diluted 145,040,061 149,056,301 154,825,604 158,617,123
Quarters Ended
--------------------------------------------------------------
November 30, August 25, May 26, February 25,
2000 2000 2000 2000
------------- ------------ ------------ ------------
Income Statement
- ----------------
Revenues, net of interest expense $ 1,376,828 $ 1,271,478 $ 1,321,306 $ 1,506,066
Net income $ 195,189 $ 181,436 $ 118,377 $ 278,181
Net income applicable to common shares $ 185,411 $ 171,658 $ 108,599 $ 268,403
Adjusted net income used for diluted earnings per share $ 201,625 $ 197,567 $ 117,084 $ 297,278
Earnings per common share:
Basic $ 1.37 $ 1.33 $ 0.77 $ 1.89
Diluted $ 1.36 $ 1.32 $ 0.77 $ 1.89
Financial Ratios
- ----------------
Return on average common equity (annualized) 18.8% 18.8% 11.0% 27.9%
Adjusted pre-tax profit margin (2) 22.6% 24.8% 13.7% 33.5%
Pre-tax profit margin (3) 20.5% 21.2% 12.5% 30.1%
After-tax profit margin (4) 14.2% 14.3% 9.0% 18.5%
Compensation & benefits/Revenues, net of interest expense 52.2% 51.7% 52.9% 47.4%
Balance Sheet
- -------------
Stockholders' equity, at period end $ 5,654,288 $ 4,911,600 $ 4,865,282 $ 4,937,291
Total stockholders' equity and trust issued preferred
securities, at period end $ 6,154,288 $ 5,411,600 $ 5,365,282 $ 5,437,291
Total capital, at period end $26,250,176 $24,768,473 $24,614,465 $23,185,770
Book value per common share, at period end $ 31.51 $ 29.58 $ 28.74 $ 28.21
Other Data (in millions, except share and employee data)
- --------------------------------------------------------
Margin debit balances, at period end $ 41,900 $ 56,000 $ 52,100 $ 61,500
Margin debit balances, average for period $ 52,900 $ 56,400 $ 59,700 $ 56,600
Customer short balances, at period end $ 57,200 $ 60,000 $ 58,800 $ 66,900
Customer short balances, average for period $ 59,900 $ 59,800 $ 61,800 $ 64,700
Stock borrowed, at period end $ 49,300 $ 48,800 $ 47,400 $ 56,100
Stock borrowed, average for period $ 51,800 $ 50,700 $ 53,000 $ 53,300
Free credit balances, at period end $ 16,500 $ 13,000 $ 14,000 $ 13,500
Free credit balances, average for period $ 15,100 $ 14,800 $ 15,000 $ 15,300
Assets under management, at period end $ 19,500 $ 16,600 $ 14,600 $ 13,700
Employees, at period end 11,201 10,807 10,373 10,210
Common shares and common share equivalents outstanding,
at period end 158,039,960 159,098,866 160,568,727 162,607,443
Weighted average number of common shares outstanding:
Basic 147,585,214 148,816,237 152,446,615 157,641,253
Diluted 148,697,431 149,242,192 152,624,273 157,685,693
(1) After change in accounting principle.
(2) Represents the ratio of income before both CAP Plan costs and provision for
income taxes to revenues, net of interest expense.
(3) Represents the ratio of income before provision for income taxes to
revenues, net of interest expense.
(4) Represents the ratio of net income to revenues, net of interest expense.
Note: Certain reclassifications have been made to prior period amounts to
conform to the current period's presentation.
16