<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_________
FORM 10-Q
(Mark One)
____
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
- - ----ACT OF 1934
For the quarterly period ended December 30, 1994
-------------------------------------------------
____ OR
____ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _____________________ to ________________________
Commission file number 1-8526
---------------------
McDonald & Company Investments, Inc.
- - --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 34-1391950
- - --------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
McDonald Investment Center, 800 Superior Avenue, Cleveland, Ohio 44114-2603
- - --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area
code (216) 443-2300
----------------------------------------------------------------------------
Not Applicable
- - --------------------------------------------------------------------------------
Former name, former address and former fiscal year, if changed since last
report
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
--- ---
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date:
8,905,994 shares of Common Stock, par value $1.00 per share, were
outstanding on February 7, 1995.
(1)
<PAGE> 2
<TABLE>
McDONALD & COMPANY INVESTMENTS, INC.
INDEX
<CAPTION>
Page
----
<S> <C>
PART I - FINANCIAL INFORMATION
- - ------------------------------
Item 1. Financial Statements -
Consolidated statements of financial condition (unaudited)-
December 30, 1994 and March 25, 1994 3
Consolidated statements of income (unaudited)-
Fiscal three and nine months ended December 30, 1994
and December 31, 1993 4
Consolidated statements of cash flows (unaudited)-
Fiscal nine months ended December 30, 1994 and
December 31, 1993 5
Notes to condensed consolidated financial statements (unaudited)-
December 30, 1994 6
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations 7
PART II - OTHER INFORMATION
- - ---------------------------
Item 5. Other Information 11
Item 6. Exhibits and Reports on Form 8-K 11
SIGNATURES 12
EXHIBIT INDEX 13
</TABLE>
(2)
<PAGE> 3
<TABLE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
MCDONALD & COMPANY INVESTMENTS, INC.
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (UNAUDITED)
<CAPTION>
Dec. 30, March 25,
1994 1994
------------ -----------
(In thousands)
<S> <C> <C>
ASSETS
Cash and cash equivalents $ 5,731 $ 6,765
Receivable from customers 110,810 124,294
Receivable from brokers and dealers 23,343 30,915
Securities purchased under agreements
to resell 159,881 216,263
Other receivables 12,872 12,087
Securities owned 120,872 152,690
Furniture, equipment and leasehold
improvements, at cost, less accumulated
depreciation and amortization 9,534 9,987
Other assets 32,613 37,577
-------- --------
$475,656 $590,578
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Short-term borrowings $ 71,279 $ 90,731
Payable to customers 38,756 28,220
Payable to brokers and dealers 7,682 23,527
Securities sold under agreements to
repurchase 151,439 198,730
Securities sold but not yet purchased 29,218 64,644
Accrued compensation 18,910 24,586
Accounts payable, accrued expenses
and other liabilities 24,311 27,735
Long-term borrowings 25,000 25,000
-------- --------
$366,595 $483,173
-------- --------
Stockholders' equity
Preferred Stock, without par value;
authorized 200,000 shares;
none issued
Common Stock, par value $1.00 per
share; 15,000,000 shares
authorized; (11,359,045 and 11,176,129
shares issued, respectively) 11,359 11,176
Additional paid-in capital 47,158 44,916
Retained earnings 72,099 66,239
Less treasury stock, at cost
(2,419,275 and 1,915,138 shares, (21,555) (14,926)
respectively) --------- --------
109,061 107,405
-------- --------
$475,656 $590,578
======== ========
<FN>
See Notes to condensed consolidated financial statements (unaudited).
</TABLE>
(3)
<PAGE> 4
<TABLE>
MCDONALD & COMPANY INVESTMENTS, INC.
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
<CAPTION>
Fiscal Three Months Ended Fiscal Nine Months Ended
------------------------------------ -------------------------------------
Dec. 30, 1994 Dec. 31, 1993 Dec. 30, 1994 Dec. 31, 1993
(13 weeks) (14 weeks) (40 weeks) (40 weeks)
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
(In thousands, except for share and per share amounts)
Revenues:
Underwriting and
investment banking $ 13,710 $ 23,614 $ 30,439 $ 47,373
Principal transactions 11,881 14,119 35,079 44,934
Commissions 12,547 14,651 37,222 39,257
Investment management fees 3,984 3,804 11,959 10,594
Interest and dividends 3,799 4,163 10,334 11,762
Other 1,395 1,566 3,379 3,734
---------- --------- ---------- ---------
$ 47,316 $ 61,917 $ 128,412 $ 157,654
---------- --------- ---------- ---------
Expenses:
Employee compensation
and benefits $ 27,167 $ 35,547 $ 75,345 $ 89,628
Interest 1,729 2,342 4,616 7,197
Communications 2,941 2,867 9,092 8,042
Occupancy and equipment 3,231 3,282 9,441 8,588
Promotion and development 1,993 1,804 5,754 5,258
Floor brokerage and
clearance 668 768 1,938 2,243
Taxes, other than income
taxes 1,397 1,363 4,393 4,001
Other operating expenses 1,803 1,793 4,845 4,603
---------- --------- ---------- ---------
$ 40,929 $ 49,766 $ 115,424 $ 129,560
---------- --------- ---------- ---------
Income before income taxes $ 6,387 $ 12,151 $ 12,988 $ 28,094
Provision for income taxes 2,320 4,600 4,950 10,600
---------- --------- ---------- ---------
Net income $ 4,067 $ 7,551 $ 8,038 $ 17,494
========== ========= ========== =========
Net income per share
Primary $ .44 $ .80 $ .86 $ 1.95
========== ========= ========== =========
Fully diluted $ .44 $ .80 $ .86 $ 1.84
========== ========= ========== =========
Dividends per share $ .08 $ .075 $ .235 $ .2125
========== ========= ========== =========
Average number of shares
and share equivalents
outstanding 9,230,000 9,498,000 9,390,000 8,950,000
========== ========= ========= =========
<FN>
See Notes to condensed consolidated financial statements (unaudited).
</TABLE>
(4)
<PAGE> 5
<TABLE>
MCDONALD & COMPANY INVESTMENTS, INC.
------------------------------------
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
-------------------------------------------------
<CAPTION>
Fiscal Nine Months Ended
--------------------------------------
Dec. 30, 1994 Dec. 31, 1993
-------------- -------------
(In thousands)
<S> <C> <C>
OPERATING ACTIVITIES:
- - --------------------
Net Income $ 8,038 $ 17,494
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 3,468 2,969
Deferred compensation 501 185
Deferred income taxes (52) (1,036)
Decrease (increase) in receivable from customers 13,484 (14,411)
Decrease (increase) in receivable from brokers and dealers 7,572 (6,316)
Decrease (increase) in securities owned 31,818 (52,227)
Increase in other receivables (785) (2,444)
Increase in payable to customers 10,536 16,889
Decrease in payable to brokers and dealers (15,845) (67)
(Decrease) increase in securities sold but not yet
purchased (35,426) 78,042
(Decrease) increase in accrued compensation (3,180) 5,612
(Decrease) increase in accounts payable, accrued
expenses and other (3,925) 9,075
--------- ---------
Net cash provided by operating activities $ 16,204 $ 53,765
========= =========
INVESTING ACTIVITIES:
- - --------------------
Purchase of furniture, equipment and leaseholds $ (2,569) $ (1,781)
Decrease (increase) in other assets 4,570 (1,947)
--------- ---------
Net cash provided by (used for) investing activities $ 2,001 $ (3,728)
========= =========
FINANCING ACTIVITIES:
- - --------------------
Decrease (increase) in securities purchased under
agreement to resell $ 56,382 $ (48,863)
(Decrease) increase in short-term borrowings (19,452) 4,404
Decrease in securities sold under
agreements to repurchase (47,291) (1,770)
Cash dividends (2,178) (1,849)
Purchase of treasury stock (7,059) (5,298)
Proceeds from issuance of treasury stock 359 722
Redemption of convertible subordinated debentures --- (198)
--------- ---------
Net cash used for financing activities $ (19,239) $ (52,852)
--------- ---------
Decrease in cash and cash equivalents (1,034) (2,815)
Cash and cash equivalents at beginning of period 6,765 7,482
--------- ---------
Cash and cash equivalents at end of period $ 5,731 $ 4,667
========= =========
<FN>
See notes to condensed consolidated financial statements (unaudited).
</TABLE>
(5)
<PAGE> 6
McDONALD & COMPANY INVESTMENTS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
December 30, 1994
NOTE A - BASIS OF PRESENTATION
- - ------ ---------------------
The condensed consolidated financial statements include the accounts of
McDonald & Company Investments, Inc. and its subsidiaries, collectively
referred to as the "Company". All significant intercompany accounts and
transactions are eliminated in consolidation.
The accompanying unaudited condensed consolidated financial statements do not
include all of the information and notes required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, all adjustments, consisting only of normal and recurring
adjustments, considered necessary for a fair presentation of the financial
condition and results of operations for the periods presented have been
included.
NOTE B - LONG-TERM BORROWINGS
- - ------ --------------------
McDonald & Company Securities, Inc., ("McDonald Securities") has outstanding
$25,000,000 in aggregate principal amount of 8.24% Subordinated Notes due
January 15, 2002. McDonald Securities is required to prepay principal amounts
of $5,000,000 on January 15 in each year beginning in 1998. The notes are
subordinated in right of payment to all senior indebtedness of McDonald
Securities. The principal amount of the notes has been approved by the New
York Stock Exchange, Inc. for inclusion in the regulatory capital of McDonald
Securities.
NOTE C - NET INCOME PER SHARE
- - ------ --------------------
Primary net income per share is based on the average number of share and share
equivalents outstanding during the periods. Share equivalents represent the
effect of shares issuable under the Company's stock option plans. For the
fiscal nine month period ended December 31, 1993, fully diluted net income per
share includes, in addition to the above, the effect of the assumed conversion
of the Company's 8% convertible subordinated debentures.
On July 27, 1993, the Company declared a 20% stock dividend payable August 20,
1993 to stockholders of record August 10, 1993. Share and per share
information have been restated to reflect the effect of the stock dividend as
if it had occurred at the beginning of fiscal 1994 period.
On October 29, 1993 the Company redeemed $197,000 aggregate principal amount of
its 8% convertible subordinated debentures due March 1, 2011 at a price of
102.4% of the principal amount plus accrued interest to October 29, 1993, for a
total cash payment of $204,310. A total of $12,008,000 principal amount of
debentures were converted into 993,694 shares of the Company's Common Stock at
a conversion price of $12.08 per share.
NOTE D - CONTINGENCIES
- - ------ -------------
The Company is a defendant in various lawsuits incidental to its securities
business, and in the opinion of management, liability, if any, resulting from
such litigation, will not have a material adverse effect on the Company's
financial condition.
(6)
<PAGE> 7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
-----------------------------------------------------------
AND RESULTS OF OPERATIONS
-------------------------
BUSINESS ENVIRONMENT
- - --------------------
McDonald & Company Investments, Inc. (the "Company") operates a full-service
regional investment banking, investment advisory and brokerage business through
its principal subsidiary, McDonald & Company Securities, Inc. ("McDonald
Securities"). The Company is involved in the origination, underwriting,
distribution, trading and brokerage of fixed income and equity securities, and
provides investment advisory services.
The profitability of the Company is sensitive to many factors, including the
level of securities trading volume and the volatility and general level of
market prices. Many of its activities have high operating costs which do not
decrease with reduced levels of activity. Sustained periods of reduced volume,
or loss of clients, could have adverse effects upon profitability.
The Company faces increasing competition from commercial banks and thrift
institutions as these institutions offer certain investment banking and
corporate and individual financial services traditionally provided only by
securities firms. The Company anticipates regulation of the securities
industry to increase and that compliance with regulations may become more
difficult. At present, the Company is unable to predict the extent of changes
that may be enacted, or the effect on the Company's business.
The Company has formulated a comprehensive strategic plan which is periodically
reviewed and revised as business conditions dictate. The plan emphasizes the
Company's historical roots as a regional brokerage and investment banking firm.
The Company has focused on the Ohio, Michigan and Indiana markets by increasing
the number of sales representatives covering individual investors, as well as
increasing investment banking activities in this region. The Company's
institutional equity and fixed income sales departments cover accounts
throughout the United States and internationally.
LIQUIDITY AND CAPITAL RESOURCES
- - -------------------------------
The majority of the Company's assets are highly liquid and short-term in
nature. Cash and liquid assets, principally receivables from customers,
brokers and dealers, securities purchased under agreements to resell, and
securities owned approximate 91% of the Company's assets at December 30, 1994.
These assets are financed by a number of sources, including the Company's
capital and short-term borrowings.
At December 30, 1994, McDonald Securities had outstanding $25,000,000 in
aggregate principal amount of 8.24% Subordinated Notes due January 15, 2002.
McDonald Securities is required to pay principal amounts of $5,000,000 on
January 15 in each year beginning in 1998. The notes are subordinated in right
of payment to all senior indebtedness and general creditors of McDonald
Securities. In addition to providing long-term financing, the notes have been
approved by the New York Stock Exchange, Inc. for inclusion in McDonald
Securities' regulatory capital.
Changes in the levels of securities owned and in customer and broker
receivables directly affect the Company's financing arrangements. The Company
has available lines of credit of $318,000,000, of which $254,200,000 was unused
at December 30, 1994. Management believes that funds from operations,
available lines of credit, and long-term borrowings provide sufficient
resources to meet present and anticipated financial needs.
(7)
<PAGE> 8
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
-----------------------------------------------------------
AND RESULTS OF OPERATIONS (continued)
-------------------------------------
LIQUIDITY AND CAPITAL RESOURCES (cont.)
- - ---------------------------------------
Certain minimum amounts of capital must be maintained by the Company's
principal broker/dealer subsidiary, McDonald Securities, to satisfy the
regulatory requirements of the Securities and Exchange Commission and the New
York Stock Exchange. The regulatory requirements represent Uniform Net Capital
Rules designed to measure the general financial integrity and liquidity of
registered broker/dealers and provide minimum acceptable net capital levels to
meet continuing commitments to customers. Net capital, as defined, changes
from day to day. At December 30, 1994, McDonald Securities was in compliance
with the Uniform Net Capital Rules and had net capital of $73,802,000, which
was $71,531,000 in excess of the minimum required.
FISCAL THREE AND NINE MONTH PERIODS ENDED DECEMBER 30, 1994 AND DECEMBER 31,
- - ----------------------------------------------------------------------------
1993
- - ----
Total revenues for the fiscal quarter ended December 30, 1994 were $47,316,000,
a decrease of $14,601,000, or 24%, from revenues of $61,917,000 for the fiscal
quarter ended December 31, 1993.
For the fiscal nine months ended December 30, 1994, total revenues were
$128,412,000 compared to $157,654,000 for the nine months of fiscal 1994, a
decrease of $29,242,000, or 19%.
Net income for the fiscal quarter ended December 30, 1994 was $4,067,000, or
$.44 per share, compared with net income of $7,551,000, or $.80 per share, for
the fiscal quarter ended December 31, 1993, which represents a decrease in net
income of 46%.
For the fiscal nine months ended December 30, 1994, net income was $8,038,000,
or $.86 per share, compared to $17,494,000 or $1.95 per share, for the fiscal
nine months ended December 31, 1993, a decrease in net income of 54%.
The average number of shares and share equivalents outstanding were 9,230,000
and 9,390,000, respectively, for the fiscal three and nine month periods ended
December 30, 1994 compared to 9,498,000 and 8,950,000, respectively, for the
fiscal three and nine months ended December 31, 1993.
Revenues from underwriting and investment banking decreased $9,904,000, or 42%
for the quarter and $16,934,000, or 36%, for the nine months ended December 30,
1994 when compared to the same periods in the prior fiscal year. Revenues from
corporate underwriting and investment banking decreased $10,439,000, or 50% for
the third quarter and $15,180,000, or 39% for the nine month period due
primarily to lower revenues from equity and debt public offerings and private
placements which declined approximately $6,607,000, or 43% for the quarter and
$8,379,000, or 32% for the nine months ended December 30, 1994. Additionally,
revenues from participations in equity syndications declined $2,443,000, or 68%
for the quarter and $4,406,000, or 49%, for the nine months ended December 30,
1994. The decline in equity syndicate revenues reflects less favorable market
conditions for public offerings of equity securities. Revenues from
participation in corporate and government underwriting syndications declined
$1,389,000, or 77% for the quarter and $2,395,000, or 63% for the nine months
ended December 30, 1994. This decline reflects the continued weakness in the
taxable debt securities markets. Revenues from municipal finance increased
$535,000, or 19%, for the quarter and decreased $1,754,000, or 21%, for the
nine months ended December 30, 1994 when compared to the same periods in fiscal
1993 due to a lower level of public finance offerings.
In the nine months of the prior fiscal year, declining interest rates resulted
in a higher level of public finance offerings and refinancings of existing
public debt.
(8)
<PAGE> 9
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
-----------------------------------------------------------
AND RESULTS OF OPERATIONS (continued)
-------------------------------------
FISCAL THREE AND NINE MONTH PERIODS ENDED DECEMBER 30, 1994 AND DECEMBER 31,
- - ----------------------------------------------------------------------------
1993 (cont.)
- - ------------
Revenues from underwriting and investment banking activities are highly
dependent on general market conditions for such business activities. Market
conditions for underwriting and investment banking services can be affected by
political and economic events both in the United States and abroad. To the
extent future events are unpredictable, uncertainty will be a factor in the
level of McDonald Securities business activity. Also, competitive pressure
from other investment bankers can and will have an effect on the success of
McDonald Securities in obtaining such business and on the prices which can be
charged for investment banking and underwriting services. The management of
McDonald Securities believes it can compete effectively in this segment of its
business activities.
Revenues from principal transactions decreased $2,238,000, or 16%, for the
third quarter of fiscal 1995 and $9,855,000, or 22% for the nine months when
compared to the same periods in the prior fiscal year. Revenues from trading
taxable fixed-income securities, including corporate bonds, United States
government bonds and mortgage-backed securities, decreased $1,124,000, or 17%,
for the third quarter and $8,899,000, or 36% for the nine months of fiscal
1995. This decrease in revenues from principal transactions in taxable
fixed-income securities reflects the low level of activity in the taxable fixed
income markets due to uncertainties related to interest rates and the economy.
For the nine months ended December 30, 1994, the decline in revenues from
trading taxable fixed income securities includes the impact of eliminating the
Company's fixed income arbitrage area effective as of the beginning of the
current fiscal year. For the nine months ended December 31, 1993, revenues
from fixed income arbitrage trading were $1,898,000 representing 21% of the
total decline in revenues from principal transactions in taxable fixed income
securities. Revenues from trading municipal bonds increased $289,000, or 12%,
for the third quarter and $1,237,000, or 20% for the nine months due primarily
to individual investor interest in tax-exempt securities due to changes in
federal income tax rates. Revenues from principal transactions in equity
securities decreased $1,403,000, or 28%, for the third quarter and $2,193,000,
or 16% for the nine months. The previous fiscal year's third quarter and nine
month revenues in this area were at record levels.
Commission revenues decreased $2,104,000, or 14%, in the current quarter and
$2,035,000, or 5% in the nine months when compared to the same periods in
fiscal 1994.
Revenues from investment management fees include advisory fees from the
Company's mutual funds and money market funds and investment management fees
earned related to individually managed accounts. Revenues from investment
management fees increased $180,000, or 5%, and $1,365,000, or 13%, for the
fiscal quarter and nine month periods ended December 30, 1994 when compared to
the comparable fiscal 1994 periods. Of these amounts, increased revenues from
advisory fees related to individually managed accounts represented $238,000, or
132%, and $1,073,000, or 79%, respectively, of the total increase for the
fiscal three and nine month periods.
Interest and dividend income decreased $364,000, or 9%, and $1,428,000, or 12%,
for the fiscal three and nine month periods ended December 30, 1994 when
compared to the same periods in the prior fiscal year. The decrease was due to
a lower level of securities owned in the current period when compared to the
same period in the prior fiscal year.
Other income decreased $171,000, or 11%, for the current quarter and $355,000,
or 10%, for the current nine month period due primarily to lower gains related
to certain venture capital investments.
(9)
<PAGE> 10
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
-----------------------------------------------------------
AND RESULTS OF OPERATIONS (continued)
-------------------------------------
FISCAL THREE AND NINE MONTH PERIODS ENDED DECEMBER 30, 1994 AND DECEMBER 31,
- - ----------------------------------------------------------------------------
1993 (cont.)
- - ------------
Operating expenses (total expenses before interest) decreased $8,224,000, or
17%, for the third quarter and $11,555,000, or 9%, for the nine months of
fiscal 1995, when compared to the same periods in the prior fiscal year.
Employee compensation and benefits decreased $8,380,000, or 24%, for the third
quarter and $14,283,000, or 16% for the nine months. Commission and other
sales compensation expense decreased $5,123,000, or 28%, for the quarter and
$7,561,000, or 16% for the nine months, primarily because of decreased revenues
from commissions and other sales credits. Other clerical and administrative
expenses increased $493,000, or 6%, for the quarter and $2,578,000, or 11% for
the nine month period. The increase in other clerical and administrative
expenses represents compensation and employee benefit costs related to an
increase in the professional and support staff in the current periods when
compared to the same periods in the prior fiscal year. The remaining decrease
in employee compensation and benefits of $3,750,000, for the third quarter and
$9,300,000 for the nine months represents decreases in incentive compensation
and profit sharing accruals which are directly related to the decline in
profitability.
All other operating expenses increased $156,000, or 1%, for the current quarter
and $2,728,000, or 8% for the nine months of fiscal 1995. The increase in all
other operating costs represents communications, occupancy and equipment,
promotional and other costs related to the expansion of the Company's business.
Interest expense decreased $613,000, or 26%, and $2,581,000, or 36%, for the
fiscal three and nine month periods in the current fiscal year when compared to
the same period in fiscal 1994. This decrease reflects a lower level of
average short-term borrowings due to a decrease in the level of securities
owned.
Income before income taxes for the fiscal quarter and fiscal nine months ended
December 30, 1994 was $6,387,000 and $12,988,000, resulting in a pre-tax return
on revenues of 13% and 10%, respectively. For the fiscal quarter and fiscal
nine months ended December 31, 1993, income before income taxes was $12,151,000
and $28,094,000, resulting in a pre-tax return on revenues of 20% and 18%,
respectively.
(10)
<PAGE> 11
PART II. OTHER INFORMATION
Item 5. Other Information
-----------------
On July 27, 1993, the Company announced the continuation of an
open market repurchase program originally announced in July, 1987.
The current program, which expires July 31, 1996, allows the
Company to purchase up to 1,200,000 shares of its Common Stock at
an aggregate price not to exceed $20,000,000. Treasury shares may
be used to satisfy options exercised under the Company's stock
option plans and 1993 Stock Bonus Plan.
During the fiscal quarter ended December 30, 1994, the Company
purchased 351,451 shares of the Company's Common Stock at an
average price of $12.24 per share. During the fiscal quarter
ended December 30, 1994 the Company utilized 3,700 shares of the
Company's Common Stock held in treasury to satisfy options
exercised under the Stock Option Plan for employees.
Item 6. Exhibits and Reports on Form 8-K
--------------------------------
<TABLE>
<CAPTION>
(a.) The following exhibit is filed as part Sequential
of this report: Page Number
-----------
<S> <C> <C>
Exhibit 11 Statement re: Computation of
Per Share Earnings . . . . . . . . . . . . . 14
Exhibit 27 Financial Data Schedule BD . . . . . . . . . 15*
<FN>
* Exhibit 27 is Furnished for Securities and Exchange Commission Purposes Only.
</TABLE>
(11)
<PAGE> 12
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 thereunto duly authorized.
McDonald & Company Investments, Inc.
----------------------------------------
(Registrant)
Date: February 8, 1994 By: /s/ William B. Summers, Jr.
----------------------- ----------------------------------------
William B. Summers, Jr.
President and Chief Executive Officer
(Principal Executive Officer)
Date: February 8, 1994 By: /s/Robert T. Clutterbuck
----------------------- ----------------------------------------
Robert T. Clutterbuck
Treasurer
(Principal Financial and Accounting
Officer)
(12)
<PAGE> 13
<TABLE>
McDonald & Company Investments, Inc.
Report on FORM 10-Q for the Fiscal Quarter ended December 30, 1994
<CAPTION>
EXHIBIT INDEX
-------------
Exhibit No. Description Sequential Page
- - ----------- ----------- ---------------
<S> <C> <C>
11 Statement Re: Computation of
Per Share Earnings . . . . . . . . . . . . . . . . . . . . 14
27 Financial Data Schedule BD . . . . . . . . . . . . . . . . . 15*
<FN>
* Exhibit 27 is Furnished for Securities and Exchange Commission Purposes Only.
</TABLE>
(13)
<PAGE> 1
<TABLE>
Exhibit 11
STATEMENT RE: COMPUTATION OF PER SHARE EARNINGS
- - -----------------------------------------------
<CAPTION>
Fiscal Three Months Ended Fiscal Nine Months Ended
---------------------------------- -----------------------------------
Dec. 30, 1994 Dec. 31, 1993 Dec. 30, 1994 Dec. 31, 1993
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
PRIMARY
- - -------
Average shares outstanding 9,119,000 9,282,000 9,227,000 8,724,000
Net effect of dilutive stock
options - based on the treasury
stock method using average
market price 111,000 216,000 163,000 226,000
---------- ---------- ---------- ------------
TOTAL 9,230,000 9,498,000 9,390,000 8,950,000
========== ========== ========== ============
Net income $4,067,000 $7,551,000 8,038,000 $ 17,494,000
========== ========== ========== ============
Net income per share $ .44 $ .80 .86 $ 1.95
========== ========== ========== ============
FULLY DILUTED
- - -------------
Average shares outstanding 9,119,000 9,282,000 9,227,000 8,724,000
Net effect of dilutive stock
options - based on the treasury
stock method using greater of
average or period - end market
price 111,000 216,000 163,000 231,000
Assumed conversion of 8%
convertible subordinated
debentures 674,000
---------- ---------- ---------- -----------
TOTAL 9,230,000 9,498,000 9,390,000 9,629,000
========== ========== ========== ===========
Net income $4,067,000 $7,551,000 $8,038,000 $17,494,000
Add interest on 8% convertible
subordinated debentures, net of
federal tax effect --- 265,000
---------- ---------- ---------- -----------
TOTAL $4,067,000 $7,551,000 $8,038,000 $17,759,000
========== ========== ========== ===========
Net income per share $ .44 $ .80 $ .86 $ 1.84
========== ========== ========== ===========
</TABLE>
(14)
<TABLE> <S> <C>
<ARTICLE> BD
<LEGEND>
This schedule contains summary financial information extracted from Consolidated
Statement of Financial Condition -- Dec-30-1994 and is qualified in its entirety
by reference to such financial statements.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> MAR-31-1995
<PERIOD-END> DEC-30-1994
<CASH> 5,731
<RECEIVABLES> 134,153
<SECURITIES-RESALE> 159,881
<SECURITIES-BORROWED> 0
<INSTRUMENTS-OWNED> 120,872
<PP&E> 9,534
<TOTAL-ASSETS> 475,656
<SHORT-TERM> 71,279
<PAYABLES> 46,438
<REPOS-SOLD> 151,439
<SECURITIES-LOANED> 0
<INSTRUMENTS-SOLD> 29,218
<LONG-TERM> 25,000
<COMMON> 11,359
0
0
<OTHER-SE> 97,702
<TOTAL-LIABILITY-AND-EQUITY> 475,656
<TRADING-REVENUE> 35,079
<INTEREST-DIVIDENDS> 10,334
<COMMISSIONS> 37,222
<INVESTMENT-BANKING-REVENUES> 30,439
<FEE-REVENUE> 11,959
<INTEREST-EXPENSE> 4,616
<COMPENSATION> 75,345
<INCOME-PRETAX> 12,988
<INCOME-PRE-EXTRAORDINARY> 12,988
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 8,038
<EPS-PRIMARY> .86
<EPS-DILUTED> .86
</TABLE>
