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 27, 1998
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, 1998, there were 3,237,610 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 27, 1998 (unaudited) and June 27, 1997 3
Consolidated Statements of Income (unaudited) -
Three months ended March 27, 1998
and March 27, 1997 4
Consolidated Statements of Income (unaudited) -
Nine months ended March 27, 1998
and March 27, 1997 5
Consolidated Statements of Cash Flows (unaudited) -
Nine months ended March 27, 1998
and March 27, 1997 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 12
Item 2. Changes in Securities 12
Item 3. Defaults upon Senior Securities 12
Item 4. Submission of Matters to a Vote of
Security Holders 12
Item 5. Other Information 12
Item 6. Exhibits and Reports on Form 8-K 12
SIGNATURES 12
EXHIBITS
PART 1. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
SCOTT & STRINGFELLOW FINANCIAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
March 27, June 27,
1998 1997
(Unaudited)
ASSETS
Cash and cash equivalents $ 6,931,648 $ 6,566,361
Cash segregated under Federal regulations 810,266 670,044
Receivable from brokers, dealers and
clearing organizations 6,681,865 2,256,973
Receivable from customers 109,077,004 90,404,457
Trading and investment securities,
at market value 19,689,472 13,548,274
Exchange memberships, at adjusted cost 838,100 838,100
Equipment and leasehold improvements,
less depreciation and amortization 4,677,168 4,075,051
Deferred income taxes 1,104,429 1,087,429
Other assets 12,467,692 10,406,848
Total Assets $ 162,277,644$ 129,853,537
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Drafts payable $ 4,677,826$ 0
Short term bank loans 12,750,000 4,950,000
Payable to brokers, dealers and clearing
organizations 5,147,397 4,714,494
Payable to customers 89,211,611 77,976,229
Securities sold, but not yet purchased,
at market value 1,891,219 545,978
Accounts payable, accrued compensation
and other liabilities 15,602,176 12,489,184
Total Liabilities 129,280,229 100,675,885
Stockholders' Equity
Common stock, $0.10 par value; Authorized
10,000,000 shares; Issued and outstanding
3,235,348 and 3,172,946 shares 323,535 317,295
Additional paid-in capital 14,855,615 12,540,734
Retained earnings 19,548,196 17,384,953
Less: subscriptions receivable -1,729,931 -1,065,330
Total Stockholders' Equity 32,997,415 29,177,652
Total Liabilities and Stockholders' Equity $ 162,277,644$ 129,853,537
See notes to consolidated financial statements.
SCOTT & STRINGFELLOW FINANCIAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
For the Three Months Ended March 27, 1998 and March 27, 1997
(Unaudited)
1998 1997
REVENUES
Commissions $ 13,644,265 $ 11,318,087
Principal transactions 3,902,264 3,561,570
Investment banking 2,818,303 1,938,026
Interest and dividends 2,373,024 1,901,488
Advisory and administrative service fees 2,997,196 2,063,604
Other 444,488 43,644
Total Revenues 26,179,540 20,826,419
EXPENSES
Employee compensation and benefits 17,173,934 13,578,197
Communications 1,027,327 964,856
Occupancy and equipment 1,361,801 1,146,835
Advertising and sales promotion 666,505 577,313
Postage, stationery and supplies 587,962 570,305
Brokerage, clearing and exchange fees 442,893 431,193
Data processing 484,432 373,907
Interest 937,534 752,994
Other operating expenses 1,473,871 1,466,474
Total Expenses 24,156,259 19,862,074
Income before income taxes 2,023,281 964,345
Income taxes 755,000 351,000
NET INCOME $ 1,268,281 $ 613,345
Earnings per share, basic $0.40 $0.20
Earnings per share, diluted $0.37 $0.19
Dividends declared per share $0.09 $0.08
Weighted average common shares outstanding 3,191,346 3,124,962
Weighted average common shares and
dilutive potential common
shares outstanding 3,393,673 3,198,819
See notes to consolidated financial statements.
SCOTT & STRINGFELLOW FINANCIAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
For the Nine Months Ended March 27, 1998 and March 27, 1997
(Unaudited)
1998 1997
REVENUES
Commissions $ 39,927,527 $ 31,036,478
Principal transactions 11,862,408 10,247,331
Investment banking 10,349,815 6,119,019
Interest and dividends 7,081,151 5,682,943
Advisory and administrative service fees 8,977,678 5,423,344
Other 751,499 229,354
Total Revenues 78,950,078 58,738,469
EXPENSES
Employee compensation and benefits 50,557,442 37,265,013
Communications 2,973,070 2,786,776
Occupancy and equipment 3,965,491 3,184,228
Advertising and sales promotion 2,003,073 1,624,659
Postage, stationery and supplies 1,935,095 1,725,502
Brokerage, clearing and exchange fees 1,393,263 1,191,140
Data processing 1,437,577 1,061,975
Interest 2,771,982 2,142,481
Other operating expenses 4,604,731 4,000,538
Total Expenses 71,641,724 54,982,312
Income before income taxes 7,308,354 3,756,157
Income taxes 2,699,000 1,370,400
NET INCOME $ 4,609,354 $ 2,385,757
Earnings per share, basic $1.45 $0.78
Earnings per share, diluted $1.35 $0.77
Dividends declared per share $0.27 $0.24
Weighted average common shares outstanding 3,183,611 3,054,432
Weighted average common shares and
dilutive potential common
shares outstanding 3,397,361 3,112,617
See notes to consolidated financial statements.
SCOTT & STRINGFELLOW FINANCIAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Nine Months Ended March 27, 1998 and March 27, 1997
(Unaudited)
1998 1997
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income $ 4,609,354 $ 2,385,757
Adjustments to reconcile net income to net cash
provided by (used for) operating activities:
Depreciation and amortization 1,460,400 1,235,075
Deferred income taxes -17,000 -173,000
Loss on disposition of fixed assets 14,290 143,043
Allowance for doubtful accounts 123,157 0
Changes in assets and liabilities:
Cash segregated under Federal regulations -140,222 -1,389,035
Receivable from brokers, dealers and
clearing organizations -4,424,892 1,527,777
Receivable from customers -18,680,069 -8,879,509
Trading securities -6,036,676 1,035,039
Other assets -382,132 441,429
Payable to brokers, dealers and
clearing organizations 432,903 2,459,308
Payable to customers 11,235,382 13,283,637
Securities sold, but not yet purchased 1,345,241 -940,082
Accounts payable, accrued compensation
and other liabilities 3,112,354 -1,992,284
NET CASH PROVIDED BY (USED FOR) OPERATING
ACTIVITIES -7,347,910 9,133,229
CASH FLOWS FROM FINANCING ACTIVITIES:
Net change in drafts payable 4,677,826 -2,395,161
Net change in short term bank loans 7,800,000 4,000,000
Cash dividends paid -860,516 -753,520
Purchase and retirement of common stock -1,878,617 -4,295,459
Issuance of common stock 1,950,181 1,227,420
NET CASH PROVIDED BY (USED FOR) FINANCING
ACTIVITIES 11,688,874 -2,216,720
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sales of not readily
marketable securities 97,478 74,752
Purchases of not readily marketable securities -202,000 -65,700
Proceeds from disposition of fixed assets 77,484 9,326
Purchases of fixed assets -2,144,682 -2,661,646
Repayment of loans receivable 115,411 99,722
Increase in loans receivable -1,919,368 -2,317,498
NET CASH PROVIDED BY (USED FOR) INVESTING
ACTIVITIES -3,975,677 -4,861,044
Net increase (decrease) in cash and cash equiv. 365,287 2,055,465
Cash and cash equivalents at beginning of period 6,566,361 4,604,319
Cash and cash equivalents at end of period $ 6,931,648 $ 6,659,784
Cash paid during the period for interest $ 2,764,142 $ 2,134,561
Cash paid during the period for income taxes $ 2,211,325 1,441,375
See notes to consolidated financial statements.
SCOTT & STRINGFELLOW FINANCIAL, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
March 27, 1998
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
period 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 report for the fiscal year ended June 27, 1997.
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 27, 1998, the
Company's net capital of $15,893,986 was 14% of its aggregate debit balances
and was $13,636,606 in excess of its minimum regulatory requirement.
3. COMMON STOCK
During the quarter ended March 27, 1998, the Company issued 23,504 shares
of common stock pursuant to the exercise of employee stock options for net
proceeds of $142,198. The Company also issued 21,963 shares of common stock
to the Employee Stock Purchase Plan for net proceeds of $462,826. In
addition, the Company issued 37,000 shares of common stock, under a private
placement exemption, to 17 management employees, including 8 executive
officers and 4 directors, in exchange for promissory notes bearing market
rates of interest, under the terms of its Management Stock Purchase Loan
Plan. The Company repurchases its common shares in the open market under
a plan approved by the Board of Directors. During the quarter, the Company
repurchased 50,784 shares for a total cost of $1,227,189, which included
purchases of 37,284 shares from directors at a total cost of $892,450, and
had remaining authority to repurchase 334,148 shares at March 27, 1998.
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 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 30 branch offices located in
Virginia, North Carolina, South Carolina, and West Virginia. Its primary
business is retail securities brokerage with an emphasis on equity securities
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,
individual retirement account custodial services, and money market cash
management services. As of March 27, 1998, the Company employed approximately
601 people including 257 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 74% 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, some of these operating costs may increase at
a proportionately greater rate than revenues during periods of increased
activity. While the Company is attempting to increase its sources of fee-based
revenue to improve the stability of revenues and earnings, 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 or increased volume. The financial services
industry is extremely competitive. Other firms are able to deliver services
at a significantly lower price than the Company and advertise those services
to a much greater extent. To maintain a competitive level of client service and
add value to its clients' investment activities, the Company incurs significant
costs in the areas of technology, investment broker recruiting, and continual
improvement of the Company's investment research capabilities.
With regard to year 2000 computer conversion issues, the Company is in the
process of determining its exposure to material year 2000 issues. The Company
relies heavily on a third party service bureau for processing of the majority
of its business transactions. While the service bureau has communicated its
intent and general plans to address year 2000 issues, any failure on the part
of the service bureau to successfully address these issues could result in a
serious disruption to the Company's ability to record and process transactions.
Virtually all of the Company's revenues are completely dependent on its ability
to process securities transactions on behalf of its own and its customers'
accounts. The Company will continue to address courses of corrective action.
Management does not believe the costs to address the year 2000 issues will have
a material effect on its financial position or results of operations.
RESULTS OF OPERATIONS
THREE MONTHS ENDED MARCH 27, 1998
For the quarter ended March 27, 1998, net earnings were $1,268,281, an 107%
increase from $613,345 reported for the third quarter of fiscal 1997. Diluted
earnings per share for the quarter increased by 95%, from $0.19 to $0.37, as
average shares and dilutive potential shares outstanding increased by 6% from
the prior period.
Total revenues for the third quarter of fiscal 1998 were $26,179,540, an
increase of 26% from $20,826,419 reported for the same period last year.
Commissions, investment banking revenues, and advisory and administrative
services fees all increased significantly from the prior year. Commissions
from agency transactions increased by 21%, from $11,318,087 to $13,644,265 as
equity market conditions continued to provide a very favorable environment for
the Company's core brokerage business. (Equity returns as measured by stock
market indexes were approximately 13% during the period.) Revenue from
principal transactions, which includes trading profits and sales credits on the
purchase and sale of securities in which the Company makes a market, increased
by 10% to $3,902,264. Investment banking revenues increased by $880,277, or
45%, to $2,818,303 as sales credits and management fees from underwritings of
equity securites, as well as corporate finance advisory fees, increased
significantly from the prior period. The Company completed 4 managed equity
offerings during the period.
Advisory and administrative fee revenue, which increased by 45% during the
period, includes fees charged brokerage accounts in lieu of commissions,
section 12(b)(1) "trail" fees and marketing reimbursements from the sponsor
of money market mutual funds which the Company provides its clients, as well
as investment advisory fees for management of clients' investment portfolios
provided by SSCM. Investment advisory fees provided approxiamtely $1,115,000
of revenues during the quarter, an increase of 71% from the prior year. On
February 27, 1998, the Company and SSCM contributed certain assets and
investment advisory contracts to Atlantic Capital Management, LLC (Atlantic)
in exchange for a 15% equity interest in Atlantic and a note receivable
with a discounted value of $1,741,226. On the same date, certain management
and other employees of SSCM resigned from the Company and assumed employment
with Atlantic. The purpose of this transaction was to provide those persons
with a significant direct ownership interest in the investment advisory
business. The investment advisory contracts which were assigned represented
approximately $518 million of client assets with associated annual fee revenue
of approximatley $4.6 million. The effect of the transaction on the Company's
annualized net income is estimated to be a reduction of approximately $585,000
or $.17 per diluted share. For the quarter ended March 27, 1998, the effect
of the transaction reduced net income by approximately $57,000, or $.02 per
diluted share, below the amount which the Company would have realized had the
transaction not occurred.
Total expenses increased by 22% to $24,156,259 from $19,862,074 in the
year-earlier period. Employee compensation and benefits, the Company's largest
expense item, increased by 27% from the year-earlier period, reflecting
increases in commissions and other variable compensation associated with higher
levels of revenue and profitability. Total employee headcount increased by
approximately 44, or 8% from one year ago. The ratio of support personnel to
investment brokers declined to 1.34 from 1.35 one year ago. Occupancy and
equipment increased by 19%, primarily as a result of increased rent expense for
both corporate headquarters and branch offices. Advertising and sales
promotion increased by 15% due to higher expenses for travel and advertising.
Data processing expense increased by 30% due to both increased transaction
volumes and custom computer programming expenses with the Company's primary
data processing service bureau. Although transaction volumes, as measure by
trade count, were approximately 19% higher than the previous year, brokerage,
clearing and exchange fees increased by only 3% due to a fee rebate from a
depository and a reduction in the execution cost of certain stock exchange
transactions. Overall, non-compensation, non-interest expenses increased by
9% from the year-earlier quarter.
Interest and dividend revenues increased by $471,536, or 25%, as a result of
continued growth in receivable balances from customer margin accounts.
Interest expense also increased by 25% as a result of interest paid on higher
levels of customer credit balances as well as increased levels of bank
borrowing used to finance the increasing margin balances.
RESULTS OF OPERATIONS
NINE MONTHS ENDED MARCH 27, 1998
For the nine month period ended March 27, 1998, net income was $4,609,354 or
$1.35 per diluted share as compared to $2,385,397 or $.77 per diluted share
reported last year.
Total revenues for the first nine months of fiscal 1998 were $78,950,078, an
increase of $20,211,609, or 34% from the year-earlier period. Significant
growth in all major revenue categories contributed to the increase. Agency
commissions increased by 29% and revenue from principal transactions increased
by 16% due to continuing strong equity market conditions. Revenues from
investment banking activities increased by 69%, primarily as a result of
increased sales credits and management fees from managed equity offerings.
Through the first 9 months of fiscal 1998, the Company has participated as
manager or co-manager in 12 equity offerings, as compared to 5 for the entire
1997 fiscal year. Revenue from advisory and administrative services fees for
the comparative nine month periods increased by $3,554,354, or 66%, due to an
approximate $1,850,000 increase in investment advisory fees because of growth
in SSCM's managed portfolios, as well as continued growth in fees from money
market products and managed account services. However, investment advisory fee
revenues are expected to decline in the near term due to the loss of fee
revenue associated with the Atlantic Capital Management transaction (see
above).
Total expenses for the nine month period increased by 30% from the prior nine
month period. Employee compensation and benefits expense increased by 36%, and
accounted for approximately 80% of the overall increase in expenses, primarily
as a result of higher commissions and other variable compensation associated
with the higher levels of revenues. Occupancy and equipment increased by 25%
due to higher rent expense on the Company's headquarters as well as branch
offices. Advertising and sales promotion increased by 23% due to increased
levels of travel, client seminars, and community relations expenditures. Data
processing increased by 35% due to higher computer service bureau charges
related to both the increased transaction volume as well as custom computer
programming projects. Other operating expenses increased commensurate with the
overall growth in headcount and transaction volumes. Overall, total operating
expenses excluding interest and compensation increased by 18%.
Interest and dividend revenues increased by $1,398,208, or 25%, as a result of
continued growth in receivable balances from customer margin accounts.
Interest expense increased by $629,141, or 29%, as a result of interest paid
on higher levels of customer credit balances as well as increased levels of
bank borrowing.
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 27, 1998, operating activities used net
cash of $7,347,909 as a result of growth in customer receivable balances of
$18,680,069, trading securities inventories of $6,036,676, and receivable from
brokers, dealers and clearing organizations of $4,424,892. Net income of
$4,609,354, increases in balances payable to customers of $11,235,382, and
other sources of operating cash flow were not sufficient to currently fund the
growth in receivables and inventory 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 somewhat arbitrary. These changes are normally short term in
nature and therefore are not very useful indicators of long-term trends in the
Company's liquidity and capital resources. However, the Company has generally
experienced increases in balances payable to and receivable from customers over
recent fiscal periods.
Net cash flow of $11,688,874 was provided by financing activities, which
included an increase in drafts payable of $4,677,826 as well as a net increase
in $7,800,000 in short term bank loans. Cash flow from issuances of the
Company's common stock during the period totaled $1,950,181, while open market
purchases and retirements of stock totaled $1,878,617.
Investing activities used net cash of $3,975,677 during the period, which
included $2,144,682 in purchases of fixed assets and $1,919,368 of new loans,
primarily to newly recruited investment brokers and other employees. Over the
nine month period, the Company's overall net cash position increased by
$365,287.
At March 27, 1998, 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
borrowings from the Company by 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 borrowings and equity capital. The Company utilizes short-term
bank borrowings under established lines of credit with several banking
institutions. A total of $62,000,000 in approved lines of credit was available
to the Company at March 27, 1998, with $12,750,000 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 in excess of the minimum requirements.
At March 27, 1998, the Company's net capital of $15,893,986 exceeded the
minimum requirement by $13,636,606. 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 - None Reportable
Item 6: Exhibits and Reports on 8-K
(a) Exhibits
Exhibit 11 - Statement Re: Computation of Per Share Earnings - 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
27, 1998
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
May 11, 1998
/s/ John Sherman, Jr.
John Sherman, Jr.
President and Chief Executive Officer
(Principal Executive Officer)
May 11, 1998
/s/ John Sherman, Jr.
Mike D. Johnston
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 27, 1998 March 27,1997
Basic Diluted Basic Diluted
Weighted average shares
outstanding:
Common shares 3,191,346 3,191,346 3,124,962 3,124,962
Dilutive potential
common shares under
stock options 0 202,327 0 73,857
Weighted average common
shares and dilutive
potential common shares
outstanding 3,191,346 3,393,673 3,124,962 3,198,819
Net earnings applicable
to common shares $1,268,281 $1,268,201 $613,345 $613,345
Earnings per share $0.40 $0.37 $0.20 $0.19
For the Nine Months Ended
March 27, 1998 March 27, 1997
Basic Diluted Basic Diluted
Weighted average shares
outstanding:
Common shares 3,183,611 3,183,611 3,054,432 3,054,432
Dilutive potential
common shares under
stock options 0 213,750 0 58,185
Weighted average common
shares and dilutive
potential common shares
outstanding 3,183,611 3,397,361 3,054,432 3,112,617
Net earnings applicable
to common shares $4,609,354 $4,609,354 $2,385,757 $2,385,757
Earnings per share $1.45 $1.35 $0.78 $0.77
<TABLE> <S> <C>
<ARTICLE> BD
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-26-1998
<PERIOD-END> MAR-27-1998
<CASH> 7741914
<RECEIVABLES> 110069211
<SECURITIES-RESALE> 0
<SECURITIES-BORROWED> 5689658
<INSTRUMENTS-OWNED> 19689472
<PP&E> 4677168
<TOTAL-ASSETS> 162277644
<SHORT-TERM> 12750000
<PAYABLES> 111261452
<REPOS-SOLD> 0
<SECURITIES-LOANED> 3377558
<INSTRUMENTS-SOLD> 1891219
<LONG-TERM> 0
0
0
<COMMON> 323536
<OTHER-SE> 32673879
<TOTAL-LIABILITY-AND-EQUITY> 162277644
<TRADING-REVENUE> 11862408
<INTEREST-DIVIDENDS> 7081151
<COMMISSIONS> 39927527
<INVESTMENT-BANKING-REVENUES> 10349815
<FEE-REVENUE> 8977678
<INTEREST-EXPENSE> 2771982
<COMPENSATION> 50557442
<INCOME-PRETAX> 7308354
<INCOME-PRE-EXTRAORDINARY> 4609354
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 4609354
<EPS-PRIMARY> 1.45
<EPS-DILUTED> 1.35
</TABLE>
