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Investors Capital Holdings Announces Fourth Quarter and Fiscal 2014
New assets to platform and increased average production per advisor results in 10.3% total revenue growth
LYNNFIELD, Mass.--(BUSINESS WIRE)--May 22, 2014--Investors Capital Holdings, Ltd. (NYSE MKT: ICH, the “Company”), a financial services holding company, announced financial results today for its fourth quarter and fiscal year ended March 31, 2014.
Fourth Quarter Highlights:
- Revenue for the fourth quarter of the fiscal year ended March 31, 2014 increased 1.8% to $23.4 million, as compared to $23.0 million in the fourth quarter of the prior year ended March 31, 2013.
- Advisory fees increased by 17.6% to $4.9 million in the fourth quarter of fiscal 2014, compared to $4.2 million in the prior period, reflecting both market appreciation as well as net new assets in our advisory platform, Investors Capital Advisory.
- Commissions revenue dropped modestly by 4.3% to $17.4 million in the fourth quarter of fiscal 2014, as compared to $18.2 million in the prior period.
- Net loss was $1.0 million for the fourth quarter of fiscal 2014 as compared to $0.3 million in the prior year’s period. Specifically, regulatory, legal and professional expenses increased by $1.0 million or 65.0% as the Company incurred $0.3 million in professions fees related to RCS Capital Corp. (“RCAP”)’s pending acquisition of ICH, coupled with $1.3 million for estimated legal settlement and defense costs, as well as 25.0% increase in advertising, marketing and promotion costs.
Fiscal Year Highlights:
- Revenue for the fiscal year ended March 31, 2014 increased 10.3% to $93.6 million, as compared to $84.9 million in the prior period reflecting momentum from both organic and recruiting growth. Notably, results reflect growth in our higher-margin fee-based business.
- Commission revenue grew 8.5% to $71.2 million, up from $65.6 million in the prior fiscal year, reflecting increased transaction volume and sales in all major product categories.
- Advisory fee-based revenue grew 14.5% to $18.8 million, up from $16.4 million in the prior fiscal year due to both new assets and positive market conditions.
- Net loss of $2.4 million as compared to operating income of $0.4 million resulting principally from approximately $1.1 million in professional fees for the pending merger with RCAP, coupled with the settlement of multiple claims and arbitrations, and finally, promotional costs increased 83.5% in recruiting and branding efforts as compared to the prior fiscal year.
- Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization, stock-based compensation and non-recurring items) reflects a loss of $0.7 million for the current fiscal year, as compared to income of $1.3 million in the prior year due to operating costs particularly in regulatory, legal and professional costs, in excess of this fiscal year’s revenue growth. Adjusted EBITDA, a non-GAAP financial measure described below, is a key metric utilized by the Company in evaluating its financial performance.
- The Company’s average revenue per representative, based on a rolling 12-month period, rose to approximately $202,000, an increase of 9.2% compared to approximately $185,000 for the prior rolling 12-month period, reflecting sustained advisor productivity.
The following information was filed by Investors Capital Holdings Ltd on Thursday, May 22, 2014 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.
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