UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 29, 1996
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 0-15105
SCOTT & STRINGFELLOW FINANCIAL, INC.
(Exact name of Registrant as specified in its charter)
Virginia 54-1315256
State or other jurisdiction of I.R.S. Employer Identification No.
Incorporation or Organization
909 East Main Street Richmond, Virginia 23219
(Address of principal executive offices) (zip code)
(804) 643-1811
(Registrant's telephone number, including area code)
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 ....
On May 6, 1996, there were 2,197,951 shares of Scott & Stringfellow Financial,
Inc. Common stock, par value $.10, issued and outstanding.
SCOTT & STRINGFELLOW FINANCIAL, INC.
INDEX
Page Number
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Statements of Financial Condition -
March 29, 1996 (unaudited) and June 30, 1995 3
Consolidated Statements of Income (unaudited) -
Three months ended March 29, 1996
and March 31, 1995 4
Consolidated Statements of Income (unaudited) -
Nine months ended March 29, 1996
and March 31, 1995 5
Consolidated Statements of Cash Flows (unaudited) -
Nine months ended March 29, 1996
and March 31, 1995 6
Notes to Consolidated Financial Statements 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 8
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 11
Item 2. Changes in Securities 11
Item 3. Defaults upon Senior Securities 11
Item 4. Submission of Matters to a Vote of
Security Holders 11
Item 5. Other Information 11
Item 6. Exhibits and Reports on Form 8-K 11
SIGNATURES 12
EXHIBITS
PART 1. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
SCOTT & STRINGFELLOW FINANCIAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Unaudited)
March 29, June 30,
1996 1995
ASSETS
Cash and cash equivalents $ 3,538,858 $ 3,761,381
Cash segregated under Federal regulations 867,216 5,803
Receivable from brokers, dealers and
clearing organizations 3,708,173 2,325,615
Receivable from customers 70,955,760 64,968,861
Trading and investment securities,
at market value 12,382,473 13,366,267
Exchange memberships, at adjusted cost 838,100 838,100
Equipment and leasehold improvements,
less depreciation and amortization 2,384,904 2,162,680
Deferred income taxes 578,429 325,429
Other assets 8,522,823 5,511,907
Total Assets $ 103,776,736 $ 93,266,043
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Drafts payable $ 1,138,965 $ 1,425,385
Short term bank loans 0 6,600,000
Payable to brokers, dealers and clearing
organizations 3,263,161 892,994
Payable to customers 60,904,781 50,782,579
Securities sold, but not yet purchased,
at market value 1,008,170 570,788
Accounts payable, accrued compensation
and other liabilities 9,189,205 7,756,451
Total Liabilities 75,504,282 68,028,197
Stockholders' Equity
Common stock, $0.10 par value; Authorized
10,000,000 shares; Issued and outstanding
2,192,511 and 2,107,620 shares 219,251 210,762
Additional paid-in capital 11,019,549 9,964,773
Retained earnings 17,432,654 15,062,311
Less: Stock notes receivable -399,000 0
Total Stockholders' Equity 28,272,454 25,237,846
Total Liabilities and Stockholders' Equity $ 103,776,736 $ 93,266,043
See notes to consolidated financial statements.
SCOTT & STRINGFELLOW FINANCIAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
For the Three Months Ended March 29, 1996 and March 31, 1995
(Unaudited)
March 29, March 31,
1996 1995
REVENUES
Commissions $ 10,511,929 $ 6,774,903
Principal transactions 2,708,949 2,716,247
Investment banking 1,272,376 1,524,262
Interest and dividends 1,651,707 1,551,950
Advisory and administrative service fees 1,257,042 675,718
Other 44,589 60,536
Total Revenues 17,446,592 13,303,616
EXPENSES
Employee Compensation and benefits 11,412,461 8,442,422
Communications 793,882 746,264
Occupancy and equipment 734,362 613,851
Postage, stationery and supplies 491,775 458,767
Advertising and sales promotion 472,568 389,961
Brokerage, clearing and exchange fees 347,880 238,152
Data processing 308,956 232,768
Interest 567,346 520,351
Other operating expenses 1,177,141 994,831
Total Expenses 16,306,371 12,637,367
Income before income taxes 1,140,221 666,249
Income taxes 412,500 242,000
NET INCOME $ 727,721 $ 424,249
Earnings per share $0.33 $0.20
Dividends declared per share $0.10 $0.10
Weighted average common shares and
common stock equivalents outstanding 2,186,519 2,111,195
See notes to consolidated financial statements.
SCOTT & STRINGFELLOW FINANCIAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
For the Nine Months Ended March 29, 1996 and March 31, 1995
(Unaudited)
March 29, March 31,
1996 1995
REVENUES
Commissions $ 29,202,712 $ 19,770,473
Principal transactions 8,016,978 8,305,735
Investment banking 7,153,242 4,648,197
Interest and dividends 4,901,527 4,239,535
Advisory and administrative service fees 3,238,585 1,993,461
Other 179,179 173,577
Total Revenues 52,692,223 39,130,978
EXPENSES
Employee Compensation and benefits 33,893,286 24,745,866
Communications 2,380,394 2,199,253
Occupancy and equipment 2,222,364 1,761,068
Postage, stationery and supplies 1,493,353 1,283,525
Advertising and sales promotion 1,326,578 1,231,734
Brokerage, clearing and exchange fees 960,407 736,995
Data processing 849,574 677,315
Interest 1,685,657 1,298,444
Other operating expenses 3,116,118 2,813,800
Total Expenses 47,927,731 36,748,000
Income before income taxes 4,764,492 2,382,978
Income taxes 1,737,500 860,000
NET INCOME $ 3,026,992 $ 1,522,978
Earnings per share $1.40 $0.72
Dividends declared per share $0.30 $0.30
Weighted average common shares and
common stock equivalents outstanding 2,154,596 2,104,383
See notes to consolidated financial statements.
SCOTT & STRINGFELLOW FINANCIAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Nine Months Ended March 29, 1996 and March 31, 1995
(Unaudited)
1996 1995
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income $ 3,026,992 $ 1,522,978
Adjustments to reconcile net income to net cash
provided by (used for) operating activities:
Depreciation and amortization 624,421 492,403
Deferred income taxes -253,000 -21,000
Allowance for (recovery of) doubtful accounts 72,042
Changes in assets and liabilities:
Cash segregated under Federal regulations -861,413 8,037
Receivable from brokers, dealers and
clearing organizations -1,382,558 -633,697
Receivable from customers -5,986,899 -3,082,246
Trading securities 1,064,616 -561,197
Other assets -2,113,853 -177,524
Payable to brokers, dealers and clearing org. 2,370,167 -1,064,233
Payable to customers 10,122,202 7,407,039
Securities sold, but not yet purchased 437,382 446,336
Accounts payable, accrued compensation
and other liabilities 1,426,843 -1,414,157
NET CASH PROVIDED BY (USED FOR) OPERATING ACTIVITIES 8,474,900 2,994,781
CASH FLOWS FROM FINANCING ACTIVITIES:
Net change in drafts payable -286,420 -6,863,048
Net change in short term bank loans -6,600,000 8,400,000
Net change in securities sold
under agreements to repurchase 0 -21,250
Cash dividends paid -638,396 -611,859
Purchase and retirement of common stock -19,140 -358,191
Issuance of common stock 671,059 390,053
NET CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES -6,872,897 935,705
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sales of not readily
marketable securities 260,077 139,987
Purchases of not readily marketable securities -340,899 -172,238
Proceeds from disposition of investment real estate 0 804,638
Proceeds from disposition of equipment 0 2,493
Purchases of equipment and leasehold improvements -837,038 -468,145
Repayment of loans receivable 78,924 289,900
Increase in loans receivable -985,590 -789,286
NET CASH PROVIDED BY (USED FOR) INVESTING ACTIVITIES -1,824,526 -192,651
Net increase (decrease) in cash and cash equivalents -222,523 3,737,835
Cash and cash equivalents at beginning of period 3,761,381 2,410,867
Cash and cash equivalents at end of period $ 3,538,858 $ 6,148,702
Cash paid during the period for interest $ 1,703,042 $ 1,316,416
Cash paid during the period for income taxes 1,523,481 588,706
See notes to consolidated financial statements.
SCOTT & STRINGFELLOW FINANCIAL, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
March 29, 1996
1. BASIS OF PRESENTATION
The accompanying consolidated financial statements include the accounts of
Scott & Stringfellow Financial, Inc. and its subsidiaries (collectively the
"Company"), Scott & Stringfellow, Inc. ("S&S"), Scott & Stringfellow Capital
Management, Inc. ("SSCM"), and Scott & Stringfellow Realty, Inc. S&S, the
Company's principal subsidiary, is a broker-dealer registered under the
Securities Exchange Act of 1934. SSCM is an investment advisor registered
under the Investment Advisors Act of 1940.
These interim consolidated financial statements are unaudited; however, such
information reflects all normal recurring adjustments which, in the opinion
of management, are necessary for a fair presentation of the results for the
periods in accordance with generally accepted accounting principles. The
nature of the Company's business is such that the results of any interim
period are not necessarily indicative of the results which might be expected
for the full fiscal year. The notes included herein should be read in
conjunction with the notes to the consolidated financial statements included
in the Company's annual audited report for the fiscal year ended June 30,
1995.
2. NET CAPITAL REQUIREMENTS
As a registered broker-dealer and a member of the New York Stock Exchange
("NYSE"), the Company's wholly-owned subsidiary, S&S, is subject to the
Securities and Exchange Commission's Uniform Net Capital Rule (Rule 15c3-1).
S&S has elected to utilize the alternative method of the Rule, which
prohibits a broker-dealer from engaging in any transactions which would
cause its "net capital" to be less than 2% of its "aggregate debit balances"
arising from customer transactions, as those terms are defined in the Rule.
The NYSE may also impose restrictions on S&S's business if its net capital
falls below 5% of aggregate debit balances. At March 29, 1996, S&S's net
capital of $17,839,387 was 24% of its aggregate debit balances and was
$16,344,939 in excess of its minimum regulatory requirement.
3. COMMON STOCK
During the quarter ended March 29, 1996, the Company issued 1,920 shares of
common stock pursuant to the exercise of employee stock options for net
proceeds of $15,796. The Company also issued 23,867 shares of common stock
to the Employee Stock Purchase Plan for net proceeds of $286,132. The
Company also issued 14,000 shares of common stock to management employees,
each of whom are directors, pursuant to the Management Stock Purchase Loan
Plan. This plan was approved by the Company's Board of Directors on
December 17, 1995. These shares were issued by the Company at a price based
upon fair market value, in exchange for fully recourse, interest-bearing
promissory notes which are payable on demand. The Company repurchases its
common shares in the open market under a plan approved by the Board of
Directors. There were no share repurchases during the quarter. The Company
had remaining authority to repurchase 313,419 shares at March 29, 1996.
4. LEGAL PROCEEDINGS
The Company and its subsidiaries are from time to time named as defendants
in legal actions incidental to its securities brokerage and investment
banking activities. Management believes that all pending claims and
lawsuits of which it has knowledge will be resolved with no material adverse
effect on the overall financial condition of the Company, although the
resolution of such matters might have a material adverse impact on the
operating results for any given quarterly accounting period.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
GENERAL
The Company's primary subsidiary, S&S, conducts a full-service, securities
brokerage and investment banking business through 28 branch offices located in
Virginia, North Carolina, West Virginia, and South Carolina, in which the
Company's first office was opened in February 1996. The Company's primary
business is retail securities brokerage with an emphasis on equity securities,
municipal bonds and mutual funds. Other significant activities and services
include institutional securities brokerage, management of and participation in
the underwriting of corporate and municipal securities, investment management
services through SSCM, corporate and municipal financial advisory services,
trading of fixed income and equity securities, primary investment research and
money market cash management services. As of March 29, 1996, the Company
employed 504 people including 216 employees with full-time Investment Broker
responsibilities.
The Company's profitability, to a large degree, is sensitive to the volume of
trading in securities and the volatility and general level of securities'
market prices. Approximately 80% of the Company's total revenue is generated
by commissions and sales credits, or mark-ups, on securities transactions.
Many of the Company's activities have high operating costs which do not
decrease proportionately with reduced levels of activity and may even increase
during such periods. Moreover, many of these operating costs may increase at
a proportionately greater rate than revenues during periods of increased
activity. While the Company attempts to build non-sales revenue and places
emphasis on control of fixed costs, its profitability is adversely affected by
sustained periods of reduced transaction volume or loss of brokerage clients.
The Company's profitability is also adversely affected when it is unable to
compensate for increases in fixed costs through the pricing of its services.
RESULTS OF OPERATIONS
THREE MONTHS ENDED MARCH 29, 1996
The Company reported a significant improvement in results for the third quarter
of its 1996 fiscal year as compared to the prior year's third fiscal quarter.
Net earnings were $727,721 as compared to $424,249, representing an increase
of 72%. Earnings per share increased 65% to $0.33 from $0.20, as weighted
average outstanding shares and common stock equivalents increased by 4%.
Total revenues for the quarter were $17,446,592, an increase of 31% from
$13,303,616 reported for the third quarter of fiscal 1995. The increase in
total revenues was attributable to increases in commissions revenues from
agency transactions of $3,737,026, or 55%, and advisory and administrative fees
of $581,324, or 86%. Although the financial markets were characterized by
increasing concerns over the direction of interest rates and economic growth,
transaction volume in the equity markets remained strong during the period. As
a result, the Company realized sizable increases in revenue from commissions
and sales credits from customer transactions in listed equity securities,
mutual funds, and over-the-counter stocks in which the Company makes a market.
These increases were partially offset by marked declines in sales credits from
both taxable and non-taxable fixed income securities. Investment banking
revenues declined by $251,886, or 17%, as the absence of any sizable managed
equity offerings during the period was only partially offset by increased fee
income from corporate finance activities and underwriting profits from
syndicate offerings. Revenue from principal transactions was nearly unchanged
from the year earlier quarter as trading losses, particularly in the municipal
bond area, completely offset the previously mentioned increase in sales credits
from over-the-counter equities in which the Company makes a market. Advisory
and administrative service fees increased by 86% to $1,257,042, as these
sources of revenue are becoming significant contributors to the Company's
overall revenue growth. In particular, investment advisory fees showed
significant increases as assets under management by the Company's investment
advisory subsidiary increased by 30% from the year-earlier quarter. Revenue
from managed accounts fees, a relatively new product area, also increased
significantly. In addition, certain rate increases for customer service charges
which took effect earlier this fiscal year accounted for a portion of the
increase in administrative fees as compared to the prior period. Interest and
dividend income also increased during the period, reflecting higher
interest-earning balances maintained by the Company and continuing increases in
margin lending to customers.
Total expenses increased by 29% to $16,306,371 from $12,637,367 in the year-
earlier period, primarily attributable to a 35% increase in employee
compensation and benefits, the Company's largest expense item. Higher
compensation expense resulted from increased commissions expense and other
forms of variable compensation associated with higher overall levels of revenue
and profitability. In addition, non-sales employee headcount increased by 7%
from the year-earlier quarter. Occupancy and equipment expense, up 20% for the
period, reflecting a continuing pattern of rent and other cost increases
associated with the Company's renovation of its Richmond headquarters building
and expansions of branch office facilities. Increases in brokerage, clearing
and exchange fees and data processing were due to a 42% increase in the overall
number of transactions processed during the period. Higher taxes based upon
gross receipts and the settlement of certain client legal matters contributed
to an 18% increase in other operating expenses. In addition, the opening of
a new branch office resulted in some in expense increases distributed
throughout several categories. Interest expense increased by 9%, reflecting
continuing increases in interest-bearing cash balances payable to Individual
Retirement Account customers, partially offset by a reduction in interest
expense due to a lower level of short-term bank borrowings during the period.
RESULTS OF OPERATIONS
NINE MONTHS ENDED MARCH 29, 1996
Net earnings for the nine month period ended March 29, 1996 were $3,026,992,
an increase of 99% from the comparable period last year. Earnings per share
increased by 94% to $1.40 per share. Total revenues increased by 35% to
$52,692,223, while expenses increased by 30% to $47,927,731.
The increase in total revenues for the nine month period reflected increases
in commissions revenues of 48%, investment banking revenues of 54%, and
advisory and administrative fees of 62% as partially offset by a decline in
revenue from principal transactions of 3%. These results were attributable to
higher transaction volumes owing to generally favorable equity market
conditions as compared to the prior fiscal year and the continued development
of the Company's fee-based products and service areas. In addition, investment
banking activity increased over the depressed level of the prior year as the
Company completed three managed stock offerings during the period. The sharp
increase in revenue from investment and advisory fees was a result of growth
in the Company's money market product area, asset management business, and the
implementation of enhanced client service charges. Offsetting these revenue
increases were declines in sales credits on both taxable and tax-exempt fixed
income securities as well as trading losses in the tax-exempt area.
A significant portion of the overall increase in expenses was a 37% increase
in employee compensation and benefits, the Company's largest expense item,
which was primarily attributable to higher variable compensation associated
with the higher overall levels of revenue and profitability. Non-compensation,
non-interest expense increased by 15% during the nine month period due
primarily to higher transaction volumes and continued investments in occupancy
and equipment. Interest expense increased by 30% during the nine month period,
reflecting continuing increases in interest-bearing cash balances payable to
Individual Retirement Account customers.
LIQUIDITY AND CAPITAL RESOURCES
As set forth in the Consolidated Statement of Cash Flows contained in this
report, the Company's primary sources of cash flow are the net cash provided
from the earnings of the Company and from increases in the amounts payable to
customers and other short-term indebtedness incurred in the normal course of
the Company's securities brokerage business.
For the nine month period ended March 29, 1996, net cash from operations was
$8,474,900. In addition to earnings of $3,026,992, cash flow from operations
was also provided by an increase of $10,122,202 in amounts payable to
customers, representing a 20% increase in credit balances in customer brokerage
accounts during the period. Cash flow was also provided by increases in
general liabilities and a modest reduction in securities inventory. The largest
use of cash in operating activities was an increase of $5,986,899 in customer
receivable balances. Because of the nature of the Company's business, the
changes in operating asset and liability account balances relative to net
income for any particular accounting period can be quite large and may not be
very useful indicators of long-term trends in the Company's liquidity and
capital resources. However, the Company's cash flow from operating activities
over the nine month period does reflect a general expansion of the Company's
balance sheet as a result of increasing customer cash and margin account money
balances.
Net cash flow of $6,872,897 was used by financing activities principally as a
result of net repayment of short term bank loans of $6,600,000. Common stock
transactions provided cash of $13,523 as new issuances of stock completely
offset cash dividends and repurchases of common stock. Investing activities
during the period used net cash of $1,824,526, which included a $985,590
increase in loans receivable associated with new Investment Broker recruiting
during the period, and $837,038 in purchases of fixed assets. Over the nine
month period, the Company's overall net cash position declined by $222,523.
At March 29, 1996, approximately 88% of the Company's assets were liquid,
consisting mainly of cash or assets readily convertible into cash. The
Company's largest asset is its receivable from customers, representing loans
from the Company to customers to finance the purchase of securities on margin.
Such receivables from customers are substantially financed by customer credit
balances (excess funds kept by customers with the Company), short-term bank
loans and equity capital. The Company utilizes short-term bank loans under
established lines of credit with several banking institutions. A total of
$58,000,000 in approved lines of credit was available to the Company at March
29, 1996, of which no amounts were outstanding. The Company had no other debt
obligations outstanding at that date.
The Company is subject to the net capital requirements of the Securities and
Exchange Commission ("SEC") and the New York Stock Exchange which are designed
to measure the general financial soundness and liquidity of broker-dealers.
The Company has consistently operated well in excess of the minimum
requirements. At March 29, 1996, the Company's net capital of $17,839,387
exceeded the minimum requirement by $16,344,939. Net capital was comprised
entirely of stockholders' equity less certain regulatory adjustments.
Management believes that funds provided by earnings combined with its existing
liquid capital base and its present lines of credit, are fully adequate to meet
the Company's financing needs for the foreseeable future.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings - None Reportable
Item 2. Changes in Securities - None Reportable
Item 3. Defaults upon Senior Securities - None Reportable
Item 4. Submission of Matters to a Vote of Security Holders - None
Reportable
Item 5. Other Information
Bagley M. Reid was named President of Scott & Stringfellow Capital
Management, Inc., the Company's wholly-owned investment advisor subsidiary,
during the period.
R. Bruce Campbell, C. Jordan Ball, Jr., Guy W. Ford, John K. Thurston,
Charles D. Aiken, Sandra D. Glass, and William F. Gunter were elected to the
Board of Directors of Scott & Stringfellow, Inc., the Company's wholly-owned
broker-dealer subsidiary, during the period.
Item 6: Exhibits and Reports on 8-K
(a) Exhibits
Exhibit 11 - Statement re: computation of earnings per share - See
Separate Document
Financial Data Schedule BD - See Separate Document
(b) Reports on Form 8-K
There were no reports on Form 8-K filed during the quarter ended March
29, 1996.
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.
SCOTT & STRINGFELLOW FINANCIAL, INC.
(Registrant)
Signatures Date
/s/ John Sherman, Jr. May 9, 1996
- ------------------------------
John Sherman, Jr.
President and Chief Executive Officer
(Principal Executive Officer)
/s/ Charles E. Mintz May 9, 1996
- ------------------------------
Charles E. Mintz
Senior Vice President and Chief Financial Officer
(Principal Financial Officer)
<PAGE>
EXHIBIT 11
STATEMENT REGARDING COMPUTATION OF EARNINGS PER SHARE
For the Three Months Ended
March 29, 1996 March 31, 1995
Primary Fully Diluted Primary Fully Diluted
Weighted average shares
outstanding:
Common shares 2,167,088 2,167,088 2,097,776 2,097,776
Dilutive shares
available under
stock options 19,431 19,431 13,419 16,962
Weighted average common
shares and common
stock equivalents
outstanding 2,186,519 2,186,519 2,111,195 2,114,738
Net earnings applicable
to common shares $727,721 $777,721 $424,249 $424,249
Earnings per share $0.33 $0.33 $0.20 $0.20
For the Nine Months Ended
March 29, 1996 March 31, 1995
Primary Fully Diluted Primary Fully Diluted
Weighted average shares
outstanding:
Common shares 2,137,451 2,137,451 2,092,814 2,092,814
Dilutive shares
available under
stock options 17,145 18,990 11,569 16,962
Weighted average common
shares and common
stock equivalents
outstanding 2,154,596 2,156,441 2,104,383 2,109,776
Net earnings applicable
to common shares $3,026,992 $3,026,992 $1,522,978 $1,522,978
Earnings per share $1.40 $1.40 $0.72 $0.72
<TABLE> <S> <C>
<ARTICLE> BD
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-28-1996
<PERIOD-START> JUL-1-1995
<PERIOD-END> MAR-29-1996
<CASH> 4,406,074
<RECEIVABLES> 71,760,920
<SECURITIES-RESALE> 0
<SECURITIES-BORROWED> 2,903,013
<INSTRUMENTS-OWNED> 12,382,473
<PP&E> 2,384,904
<TOTAL-ASSETS> 103,776,736
<SHORT-TERM> 0
<PAYABLES> 73,079,212
<REPOS-SOLD> 0
<SECURITIES-LOANED> 1,416,900
<INSTRUMENTS-SOLD> 1,008,170
<LONG-TERM> 0
<COMMON> 219,251
0
0
<OTHER-SE> 28,053,203
<TOTAL-LIABILITY-AND-EQUITY> 103,776,736
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<COMMISSIONS> 29,202,712
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<FEE-REVENUE> 3,238,585
<INTEREST-EXPENSE> 1,685,657
<COMPENSATION> 33,893,286
<INCOME-PRETAX> 4,764,492
<INCOME-PRE-EXTRAORDINARY> 3,026,992
<EXTRAORDINARY> 0
<CHANGES> 0
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