SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Pursuant to Section 13 or 15 (d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) April 15, 1998
THE BEAR STEARNS COMPANIES INC.
Exact name of registrant as specified in its charter
DELAWARE File No. 1-8989 13-3286161
(State or other (Commission File (IRS Employer
jurisdiction of Number) Identification
incorporation) Number)
245 Park Avenue, New York, New York 10167
(Address of principal executive offices) (zip code)
Registrant's telephone number, including area code: (212) 272-2000
---------------
Not Applicable
(former name or former address, if changed since last report)
<PAGE>
Item 5. Other Events.
Filed herewith is a copy of The Bear Stearns Companies Inc.'s ( the "Company")
Press Release, dated April 15, 1998, announcing its earnings for the three and
nine months ended March 27, 1998 which includes the Unaudited Consolidated
Statements of Income for the Company for the three and nine months ended March
27, 1998 and March 27, 1997, and the three months ended December 31, 1997. All
normal recurring adjustments that are, in the opinion of management, necessary
for a fair presentation of the results of operations for the periods presented
have been included. The nature of the Company's business is such that the
results for any interim period are not necessarily indicative of the results for
a full year.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
(a) Financial Statements of business acquired:
Not applicable.
(b) Pro Forma financial information:
Not applicable.
(c) Exhibit:
(99) Press Release, dated April 15, 1998.
<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 thereunto duly authorized.
THE BEAR STEARNS COMPANIES INC.
By: /s/ Michael J. Abatemarco
Michael J. Abatemarco
Controller
Dated: April 16, 1998
<PAGE>
THE BEAR STEARNS COMPANIES INC.
FORM 8-K
CURRENT REPORT
EXHIBIT INDEX
Exhibit No. Description
(99) Press Release, dated April 15, 1998
For Immediate Release
Contacts: Hannah Burns (212) 272-2395
Maura Gaenzle (212) 272-4445
Ellen Glickman (212) 272-8188
THE BEAR STEARNS COMPANIES INC.
REPORTS THIRD QUARTER RESULTS
New York, New York -- April 15, 1998 -- The Bear Stearns Companies Inc.
(NYSE:BSC) today announced earnings for the company's third fiscal quarter ended
March 27, 1998.
Net income for the third quarter of fiscal year 1998 was $166.3 million
or $1.15 per share, a 0.5% increase in net income from $165.5 million or $1.14
per share, for the comparable quarter last year. The annualized return on common
stockholders' equity for the quarter was 21.4%.
Net income for the first nine months of fiscal year 1998 was $488.2
million or $3.37 per share, an 8.4% increase in net income from $450.4 million
or $3.05 per share, for the comparable period a year ago. The annualized return
on common stockholders' equity for the nine months ended March 27, 1998 was
21.8%.
Revenues, net of interest expense, for the quarter ended March 27, 1998
were $1.1 billion, a 12.4% increase from $934.5 million for the comparable
quarter a year ago. For the nine months ended March 27, 1998, revenues, net of
interest expense, were $3.1 billion, a 21.7% increase from $2.6 billion a year
ago.
President and Chief Executive Officer James E. Cayne commented, "Bear Stearns is
benefiting from the current environment of consolidation and retrenchment in the
financial services industry, taking advantage of the substantial opportunities
to add talented professionals who are attracted to our client-driven culture.
Over the past year we have added many people firmwide to support our core
businesses, as well as to those areas we are aggressively building. Our
professional staff is up 20%, with significant additions in investment banking,
institutional equities and asset management. Part of this growth includes many
staff additions to our London office as we focus on increasing European
opportunities."
He added, "Business was generally robust during the quarter in an
environment notable for tremendous new debt issuance and a rallying stock
market. The firm's earnings reflect its consistent focus on a balanced revenue
base. In addition, our clearing operation hit new highs during the quarter in
terms of client count, margin debit balances, short selling activity and
transaction volume."
Highlights of the results follow:
Commission revenues rose 17.9% to $226.1 million in the third quarter of fiscal
year 1998 from $191.8 million reported in the third quarter of fiscal year 1997.
Principal transactions revenues reached $452.7 million for the three months
ended March 27, 1998, 11.1% higher than those of the quarter ended March 27,
1997.
Investment banking revenues were $197.4 million for the third quarter, an
increase of 4.6% over the prior year's quarter. Net interest revenues increased
17.6% to $159.8 million for the three months ended March 27, 1998, from $135.8
million reported for the third quarter a year ago.
Compensation as a percentage of net revenues for the third quarter of fiscal
year 1998 was 48.9% versus 49.7% for the third quarter of fiscal year 1997. For
the nine months ended March 27, 1998, compensation as a percentage of net
revenues was 49.6% compared to 49.4% for the nine-month period a year ago.
Quarterly Cash Dividends Declared
The Board of Directors declared a regular quarterly cash dividend of 15 cents
per share on the outstanding shares of common stock, payable May 29, 1998 to
shareholders of record on May 15, 1998. The board also declared a quarterly cash
dividend of 68.75 cents per share on the outstanding shares of adjustable rate
cumulative preferred stock, payable July 15, 1998 to shareholders of record on
June 30, 1998. In addition, the board declared a quarterly cash dividend of
$3.80 per share on the outstanding shares of 7.60% cumulative preferred stock,
which is equivalent to 47.50 cents per related depositary share, and a quarterly
cash dividend of $3.075 per share on the outstanding shares of 6.15% cumulative
preferred stock, which is equivalent to 76.875 cents per related depositary
share, all payable July 15, 1998 to shareholders of record on June 30, 1998.
The Bear Stearns Companies Inc. is the parent company of Bear, Stearns
& Co. Inc., a leading investment banking and securities trading and brokerage
firm serving governments, corporations, institutions and individuals worldwide.
The company's business includes corporate finance and mergers and acquisitions,
institutional equities and fixed income sales and trading, private client
services, derivatives, foreign exchange and futures sales and trading, asset
management and custody services. Through Bear, Stearns Securities Corp., it
offers professional and correspondent clearing, including securities lending.
Headquartered in New York City, the company has 9,000 employees located in
domestic offices in Atlanta, Boston, Chicago, Dallas, Los Angeles and San
Francisco; and an international presence in Beijing, Buenos Aires, Dublin,
Geneva, Hong Kong, London, Lugano, Paris, Sao Paulo, Shanghai, Singapore and
Tokyo. As of March 27, 1998 total capital, including stockholders' equity and
long-term borrowings, was $16.3 billion. Book value as of March 27, 1998 was
$22.39 per share, based on 151,561,466 shares outstanding.
-30-
Financial Statements Attached
<PAGE>
<TABLE>
THE BEAR STEARNS COMPANIES INC.
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
<CAPTION>
Three Months Ended Nine Months Ended
------------------------------------- ---------------------------------------
March 27, March 27, March 27, March 27,
1998 1997 1998 1997
--------------- ---------------- ---------------- -----------------
(In thousands, except per share data)
<S> <C> <C> <C> <C>
Revenues
Commissions $ 226,067 $ 191,817 $ 670,007 $ 536,971
Principal transactions 452,742 407,336 1,234,768 1,131,467
Investment banking 197,407 188,706 695,619 480,538
Interest and dividends 1,037,202 712,685 3,083,071 2,118,552
Other income 14,203 10,757 50,228 36,456
------------------ ---------------- ---------------- -----------------
Total Revenues 1,927,621 1,511,301 5,733,693 4,303,984
Interest expense 877,392 576,836 2,613,611 1,740,701
------------------ ---------------- ---------------- -----------------
Revenues, net of interest expense 1,050,229 934,465 3,120,082 2,563,283
----------------- --------------- --------------- ----------------
Expenses
Employee compensation and benefits 513,254 464,596 1,548,244 1,265,793
Floor brokerage, exchange
and clearance fees 40,975 36,587 124,082 102,600
Communications 31,898 26,085 88,855 75,419
Depreciation and amortization 29,375 22,533 82,819 63,951
Occupancy 25,962 22,658 74,895 65,949
Advertising and market development 22,680 15,890 58,691 47,329
Data processing and equipment 11,919 10,019 36,613 25,780
Other expenses 108,443 60,322 313,417 171,615
------------------ ---------------- ---------------- -----------------
Total expenses 784,506 658,690 2,327,616 1,818,436
------------------ ---------------- ---------------- -----------------
Income before provision for
income taxes 265,723 275,775 792,466 744,847
Provision for income taxes 99,404 110,294 304,307 294,405
------------------ ---------------- ---------------- -----------------
Net income $ 166,319 $ 165,481 $ 488,159 $ 450,442
================== ================ ================ =================
Net income applicable to
common shares $ 157,193 $ 159,552 $ 467,184 $ 432,543
================== ================ ================ =================
Earnings per share $ 1.15 $ 1.14 $ 3.37 $ 3.05
================== ================ ================ =================
Weighted average common and
common equivalent shares
outstanding 150,084,539 146,932,199 151,899,468 148,978,719
================== ================ ================ =================
Cash dividends declared
per common share (1) $ 0.15 $ 0.14 $ 0.45 $ 0.43
================== ================ ================ =================
(1) Adjusted for 5% stock dividend declared on January 29, 1997.
</TABLE>
<PAGE>
<TABLE>
THE BEAR STEARNS COMPANIES INC.
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
<CAPTION>
Three Months Ended
----------------------------------------
March 27, December 31,
1998 1997
----------------- --------------------
(In thousands, except per share data)
<S>
Revenues <C> <C>
Commissions $ 226,067 $ 230,496
Principal transactions 452,742 390,512
Investment banking 197,407 278,884
Interest and dividends 1,037,202 1,081,298
Other income 14,203 11,877
--------------------- --------------------
Total Revenues 1,927,621 1,993,067
Interest expense 877,392 919,304
--------------------- --------------------
Revenues, net of interest expense 1,050,229 1,073,763
--------------------- --------------------
Expenses
Employee compensation and benefits 513,254 535,793
Floor brokerage, exchange
and clearance fees 40,975 43,522
Communications 31,898 28,824
Depreciation and amortization 29,375 27,427
Occupancy 25,962 25,387
Advertising and market development 22,680 20,057
Data processing and equipment 11,919 12,460
Other expenses 108,443 120,688
--------------------- --------------------
Total expenses 784,506 814,158
--------------------- --------------------
Income before provision for
income taxes 265,723 259,605
Provision for income taxes 99,404 99,383
--------------------- --------------------
Net income $ 166,319 $ 160,222
===================== ====================
Net income applicable to
common shares $ 157,193 $ 154,299
===================== ====================
Earnings per share $ 1.15 $ 1.11
===================== ====================
Weighted average common and
common equivalent shares
outstanding 150,084,539 152,312,886
===================== ====================
Cash dividends declared
per common share $ 0.15 $ 0.15
===================== ====================
</TABLE>
