SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report:
April 25, 1995
Salomon Inc
(Exact name of registrant as specified in its charter)
Delaware 1-4346 22-1660266
(State of Incorporation) (Commission File No.) (I.R.S. Employer
Identification No.)
Seven World Trade Center, New York, New York 10048
(Address of Principal Executive Offices) (Zip Code)
(212) 783-7000
(Registrant's Telephone No.)
<PAGE>
Item 5. Other Events
On April 25, 1995, the Registrant issued a press release,
a copy of which is filed herewith as Exhibit 99 and
incorporated herein by reference in its entirety.
Item 7. Financial Statements, Pro Forma Financial
Information and Exhibits
Exhibits:
(99) Press release dated April 25, 1995
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has duly caused this report to be
signed on its
behalf by the undersigned hereunto duly authorized.
SALOMON INC
(Registrant)
Date: April 25, 1995 By: /s/ Jerome H. Bailey
Chief Financial Officer
Contact: Robert F. Baker
212-783-6299
For immediate release:
SALOMON INC REPORTS QUARTERLY NET INCOME OF $81 MILLION
New York, April 25, 1995 - Salomon Inc today announced net
income of $81 million for
the 1995 first quarter compared with net income of $66
million for the first quarter of
1994. Fully diluted earnings per share were $0.59 and fully
diluted return on common
equity was 7.1% compared with $0.48 and 5.0% for the
comparable 1994 quarter.
Salomon Brothers, the Company's global investment banking
and securities business,
earned $60 million before taxes in the 1995 first quarter.
Strong results for the
Proprietary Trading Businesses, which recorded pretax
earnings of $239 million, were
offset by weakness in the Client-Driven Business, which
recorded a pretax loss of $179
million. Salomon Brothers earned $39 million before taxes in
the first quarter of 1994.
First quarter results for Salomon Brothers' Client-Driven
Business reflect depressed
volume levels for customer activity, both capital raising
and secondary market trading. In
addition, first quarter investment banking revenues were
adversely impacted by nearly
$70 million of pretax losses on Latin American securities
positions that arose in
connection with underwriting activities. First quarter
Client-Driven Business results also
included a $12 million loss (including severance costs) from
the Private Investment
Department, which was closed in the first quarter.
Phibro Division had good results from its commodities
trading activities with pretax
earnings for the quarter of $123 million. In the comparable
1994 quarter, Phibro Division
earned $50 million before taxes. Results for Phibro
Division are likely to show significant
quarter-to-quarter volatility.
Phibro USA, the Company's oil refining and marketing
business, recorded the worst
quarterly operating result in its ten-year history with a
pretax loss of $51 million
compared with pretax earnings of $27 million in the first
quarter of 1994. Results were
adversely affected by weak refining margins which were
impacted by unseasonably warm
weather in the northeastern United States and an oversupply
of gasoline inventories
which resulted from implementation of the reformulated
gasoline program. In addition,
Phibro USA's Houston refinery underwent a five week shutdown
for turnaround
maintenance during the first quarter.
<PAGE>
Total assets were $165 billion at March 31, 1995 and average
assets for the quarter
were $172 billion. Book value per common share was $33.22
at the end of the first
quarter, up from $32.65 at year end 1994. Treasury share
repurchases were negligible
during the first quarter; shares authorized for future
repurchase remained at 9.8 million at
March 31, 1995.
Selected financial information and the unaudited
consolidated statement of income
follow:
<PAGE>
SALOMON INC AND SUBSIDIARIES
Selected Financial Information (unaudited)
(Dollars in millions, except per share data)
<TABLE>
<CAPTION>
Quarter ended
March 31,
1995 1994
<S> <C> <C>
SUMMARY OF OPERATING RESULTS BY
SEGMENT:
Income before taxes:
Salomon Brothers' business unit
contributions:
Client-Driven Business $ (179) $ (173)
Proprietary Trading Businesses 239 212
------ ------
Total Salomon Brothers 60 39
Phibro Division 123 50
Phibro USA (51) 27
Corporate and Other 2 (4)
------ ------
Income before taxes $ 134 $ 112
====== ======
Salomon Brothers' revenues, net of
interest expense:
Client-Driven Business:
Global investment banking $ 22* $ 170
Fixed income secondary markets 135 198
Equity secondary markets 55 (16)
Foreign exchange (2) (111)
Private Investment Department 6 5
Asset Management 9 9
------ ------
Total Client-Driven Business 225 255
Proprietary Trading Businesses 362 341
------ ------
Total Salomon Brothers' revenues,
net of interest expense $ 587 $ 596
====== ======
RETURN ON AVERAGE COMMON STOCKHOLDERS'
EQUITY:
Primary 7.1% 5.0%
Fully diluted** 7.1% 5.0%
====== ======
PER COMMON SHARE:
Cash dividends $ 0.16 $ 0.16
High market price 40 1/8 52 3/4
Low market price 32 1/4 44 3/4
Ending market price 33 7/8 48 1/2
Book value at quarter-end 33.22 37.87
====== ======
AT QUARTER-END (in billions):
Total assets $ 165 $ 173
Average assets for the quarter 172 184
Common equity 3.6 4.1
Convertible preferred equity 0.7 0.7
Perpetual preferred equity 0.3 0.3
====== ======
<FN>
* Includes nearly $70 million of pretax losses on Latin
American securities positions that arose in connection
with underwriting activities.
** Assumes conversion of convertible notes and redeemable
preferred stock, unless such assumptions result in a
higher return on equity than determined under the
primary method.
</TABLE>
<PAGE>
SALOMON INC AND SUBSIDIARIES
Consolidated Statement of Income (unaudited)
(Dollars in millions, except per share data)
<TABLE>
<CAPTION>
Quarter ended
March 31,
1995 1994
<S> <C> <C>
Revenues, net of interest expense:
Interest and dividend income,
net of interest expense $283 $342
Principal transactions 370 53
Investment banking 22* 170
Commissions 89 90
Other (21) 56
------ ------
Revenues, net of interest expense 743 711
------ ------
Noninterest expenses:
Compensation and employee-related 431 417
Technology 64 60
Professional services and business
development 45 34
Occupancy 41 38
Clearing and exchange fees 16 20
Other 12 30
------ ------
Total noninterest expenses 609 599
------ ------
Income before taxes 134 112
Income taxes 53 46
------ ------
Net income $ 81 $ 66
====== ======
EARNINGS PER SHARE:
Primary $ 0.59 $0.48
Fully diluted** 0.59 0.48
====== ======
WEIGHTED AVERAGE SHARES OF
COMMON STOCK OUTSTANDING
(in thousands):
For primary earnings per share 106,300 110,600
For fully diluted earnings per share 106,700 111,100
======= =======
<FN>
* Includes nearly $70 million of pretax losses on Latin
American securities positions that arose in connection
with underwriting activities.
** Assumes conversion of convertible notes and redeemable
preferred stock, unless such assumptions result in
higher earnings per share than determined under the
primary method.
</TABLE>
