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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) January 20, 1997
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PAINE WEBBER GROUP, INC.
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(Exact name of registrant as specified in its charter)
Delaware 1-7367 13-2760086
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
1285 Avenue of the Americas, New York, New York 10019
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (212) 713-2000
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Not Applicable
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(Former name or address, if changed since last report)
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PAINE WEBBER GROUP INC.
Item 5 Other Events
(a) Copy of the Registrant's press release which, among other
things, reported financial results for 1996 and for the
fourth quarter of 1996.
SIGNATURE
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.
PAINE WEBBER GROUP INC.
By: /s/ REGINA DOLAN
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Regina Dolan
Vice President and
Chief Financial Officer
Dated: March 11, 1997
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EXHIBIT INDEX
(a) Copy of the Registrant's press release which, among other things, reported
results for 1996 and for the fourth quarter of 1996.
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PAINEWEBBER Corporate Communications
PaineWebber Incorporated
1285 Avenue of the Americas, 14th Floor
New York, NY 10019-6028
(212) 713-8391
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NEWS RELEASE
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FOR IMMEDIATE RELEASE
Contact: Gus Carlson
Paine Webber Group Inc.
212-713-8502
PAINE WEBBER GROUP REPORTS RECORD RESULTS FOR 1996
-ANNUAL EARNINGS PER SHARE OF $3.38; NET INCOME INCREASES TO $364 MILLION-
-FOURTH QUARTER NET INCOME RISES BY MORE THAN 55 PERCENT; EPS OF $0.86-
NEW YORK, January 20, 1997 - Paine Webber Group Inc. reported today
record financial results for 1996. Net income was $364.4 million, or $3.38 per
fully diluted common share, for the year ended December 31, 1996, compared with
net income of $80.8 million, or $0.52 cents per fully diluted common share, for
1995, including a charge related to limited partnership investment issues.
Revenues, including net interest, were $3,735 million for 1996, an increase of
11.5 percent from $3,350 million the previous year.
For the fourth quarter ended December 31, 1996, net income was $91.5
million, or $0.86 per fully diluted common share, an increase of 55.6 percent
from $58.8 million, or $0.50 per fully diluted common share, in the
corresponding period a year ago. Revenues, including net interest, were $940.0
million, an increase of almost 6 percent from $887.7 million for the fourth
quarter of 1995. Return on common equity was 21.2 percent for the quarter,
compared with 19.6 percent for the year-ago period, excluding the special
charge.
Donald B. Marron, Paine Webber's chairman and chief executive officer,
said the record performance for 1996 reflects the impact of strategic
initiatives introduced during the last two years that have allowed the firm to
reach new operating levels.
"We are pleased with the consistency and improvement our 1996 results
represent and we believe they reflect a great deal more than the firm's ability
to prosper in a vigorous bull market," Mr. Marron said. "Our earnings of $364.4
million for 1996, which far surpassed those of any previous year, and our strong
return on common equity of 21.9 percent are the results of our focus on building
our franchise, leveraging our strengths and attaining the aggressive
operational and performance goals we have identified as keys to our continued
growth."
-more-
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Paine Webber Group Inc.
Page 2
Mr. Marron said Paine Webber surpassed a number of strategic goals the
firm set for 1996 in strengthening its distribution franchise, including the
following:
- - Assets under control, the key performance measure of the firm's
asset-gathering strategy, grew to $245 billion at the end of 1996, an
increase of 13 percent from the previous year and better than the goal of
$240 million.
- - Recurring fee income, a reflection of the improving quality of the firm's
revenue stream, reached an all-time high of $571 million, an increase of
15 percent from the previous year and on target with the $570 million goal
for the year.
- - The number of producers, an important indicator of the firm's distribution
capabilities, reached 7,400, exceeding the goal for the year. Producers
include retail investment executives and institutional salespeople.
Commissions reached an all-time high of nearly $1,381 million in 1996,
an increase of 8.5 percent from 1995, the previous record year for commissions,
reflecting the firm's success in achieving its strategic goals.
Paine Webber also maintained its strong market share in equity trading,
mortgage-backed securities and municipal underwriting, and achieved significant
revenue gains in investment banking.
"Our strategies support the firm's overall mission of building the
assets of our clients, employees and shareholders," Mr. Marron said. "We are
confident that these strategies will allow us to further leverage our strengths
to assure consistent performance in the years ahead."
Paine Webber Group Inc., together with its subsidiaries, serves the
investment and capital needs of a worldwide client base. The firm employs
15,870 people in 298 offices. As of December 31, 1996, the book value per share
was $18.28.
-TWO TABLES TO FOLLOW-
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PAINE WEBBER GROUP INC.
CONSOLIDATED STATEMENTS OF INCOME
(IN THOUSANDS EXCEPT SHARE AND PER SHARE AMOUNTS)
(UNAUDITED)
<TABLE>
<CAPTION>
Quarter Ended December 31, Year Ended December 31,
1996 1995 1996 1995
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<S> <C> <C> <C> <C>
REVENUES
Commissions $ 344,422 $ 344,994 $ 1,381,475 $ 1,272,766
Principal Transactions 235,130 232,175 1,023,615 914,201
Asset Management 118,606 107,509 453,267 399,540
Investment Banking 113,947 94,397 391,164 326,777
Interest 624,206 563,327 2,309,737 2,256,750
Other 33,217 31,975 146,708 150,056
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TOTAL REVENUES 1,469,528 1,374,377 5,705,966 5,320,090
Interest Expense 529,560 486,705 1,970,754 1,969,811
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NET REVENUES 939,968 887,672 3,735,212 3,350,279
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NON-INTEREST EXPENSES
Compensation and Benefits 558,836 528,948 2,219,129 2,004,585
Office & Equipment 66,251 66,575 267,006 266,291
Communications 37,064 37,588 153,301 149,047
Business Development 20,760 22,394 75,981 90,752
Brokerage, Clearing & Exchange Fees 21,965 21,101 87,839 93,657
Professional Services 30,060 29,001 108,123 101,911
Other Expenses 63,256 103,262 263,800 541,359
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TOTAL NON-INTEREST EXPENSES 798,192 808,869 3,175,179 3,247,602
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INCOME BEFORE INCOME TAXES AND MINORITY INTEREST 141,776 78,803 560,033 102,677
Provision for Income Taxes 49,260 20,005 194,649 21,927
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INCOME BEFORE MINORITY INTEREST 92,516 58,798 365,384 80,750
Minority Interest 1,034 -- 1,034 --
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NET INCOME $ 91,482 $ 58,798 $ 364,350 $ 80,750
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NET INCOME APPLICABLE TO COMMON SHARES $ 84,765 $ 52,155 $ 339,017 $ 54,781
EARNINGS PER SHARE
PRIMARY $ 0.91 $ 0.52 $ 3.59 $ 0.54
FULLY DILUTED $ 0.86 $ 0.50 $ 3.38 $ 0.52
WEIGHTED AVERAGE COMMON SHARES
PRIMARY 93,400,000 99,525,000 94,406,000 101,272,000
FULLY DILUTED 100,013,000 106,749,000 102,145,000 101,272,000
</TABLE>
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PAINE WEBBER GROUP INC.
QUARTERLY STATISTICAL SUPPLEMENT - OPERATING RESULTS [UNAUDITED]
<TABLE>
<CAPTION>
4Q 96 3Q 96 2Q 96 1Q 96 4Q 95
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<S> <C> <C> <C> <C> <C>
ROE Common 21.2% 18.8% 22.7% 25.4% 19.6%*
Pre-Tax Margin 15.0% 14.0% 14.8% 16.1% 12.3%*
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E.P.S. [fully diluted] $0.86 $0.75 $0.86 $0.92 $0.69*
Fully Diluted Shares [Millions) 100.0 100.1 102.3 104.5 106.7*
Dividends Paid Per Common Share $0.12 $0.12 $0.12 $0.12 $0.12
Book Value Per Common Share $18.28 $17.45 $16.89 $16.25 $15.62
Common Shares Outstanding [Millions] 93.0 92.3 93.0 94.0 97.1
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Total Capital [$Billions] $4.90 $4.43 $4.36 $4.28 $4.18
Total Shareholders' Equity [$Billions] $1.73 $1.68 $1.62 $1.57 $1.55
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Assets Under Control [$Billions] $244.7 $234.1 $228.2 $222.3 $216.3
Assets Under Management [$Billions] $44.8 $43.9 $44.4 $45.9 $43.7
Money Market Funds 22.9 22.2 21.7 22.6 20.6
Long Term Mutual Funds 9.4 9.2 9.0 9.0 8.6
Institutional and Other 12.5 12.5 13.7 14.3 14.5
Wrap Fee Assets [$Billions] $14.7 $13.5 $12.8 $11.9 $10.8
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Recurring Fees (YTD Annualized) $571 $560 $553 $546 $498
[$Millions]
Recurring Fees (Incl. Margin Interest) -
As a % of Fixed Costs 73% 69% 68% 66% 68%
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Employees 15,870 15,715 15,775 15,800 15,900
Investment Executives 6,095 5,980 6,015 6,005 6,025
Sales Offices 298 299 302 305 310
</TABLE>
*REFLECT OPERATING RESULTS EXCLUDING LIMITED PARTNERSHIP INVESTMENT CHARGE.
