Leucadia National Corporation (NYSE: LUK) today announced its
financial results for the fourth quarter and year ended December
31, 2014. Results attributable to Leucadia National Corporation
common shareholders were a loss of $9.8 million, or ($.03) per
diluted share, for the fourth quarter, and income of $204.3
million, or $.54 per diluted share, for the year ended December 31,
2014. These consolidated fourth quarter results include a $52.3
million charge, or $41.0 million net of tax, recorded by Jefferies
in the fourth quarter for a bad debt provision in respect to a
receivable from a Bache customer, OW Bunker. Our full year results
also include $116.6 million of after-tax charges, consisting of
losses related to our discontinued Lake Charles clean energy
project and costs associated with two lawsuits which we either have
settled or have an agreement in place to settle. Together these
charges reduced net income by a total of $157.6 million, or $.42
per diluted share. These results do not include goodwill impairment
charges of $54 million recorded by Jefferies, which have not been
reflected in Leucadia consolidated results, due to differences in
evaluation requirements under U.S. GAAP. Jefferies is in the
process of finding strategic alternatives for the Bache business
and the goodwill charge may be expensed by Leucadia in the first
half of 2015 when the potential transaction is consummated.
In addition, the Company announced today that its Board of
Directors has declared a quarterly cash dividend equal to $.0625
per Leucadia common share payable on March 27, 2015 to record
holders of Leucadia common shares on March 16, 2015.
During the fourth quarter of 2014, Leucadia repurchased 704,806
shares at an average price of $21.55. Book value per share on
December 31, 2014 was $28.03.
During the fourth quarter, we made a number of follow-on
investments in some of our existing businesses, purchasing
additional shares in Harbinger for $64.5 million, bringing our
ownership to about 23%, and investing a further $37.5 million to
expand Garcadia’s auto dealerships. We also invested $78.4 million
in Juneau Energy, our subsidiary that leases and develops oil and
gas properties in Texas and Oklahoma, bringing our net book value
for that investment to $175.8 million.
During January 2015, we invested $300 million in FXCM to rescue
the online provider of foreign exchange trading and related
services, which had experienced significant losses as a result of
the Swiss National Bank scrapping its three-year old peg of 1.20
Swiss francs per euro. Our investment in FXCM, an industry leader
with a $1.5 billion total capitalization the day prior to the Swiss
National Bank’s action, is structured as a two-year secured term
loan with an initial interest rate of 10% per annum, increasing by
1.5% per annum each quarter for so long as the loan is outstanding.
The term loan is entitled to monthly payments from proceeds
received during the immediately preceding calendar month from
collections of accounts receivable. We are also entitled to a
deferred financing fee of $10 million, with an additional fee of up
to $30 million becoming payable in the event the aggregate
principal amount of the term loan outstanding on April 16, 2015 is
greater than $250 million. We have already begun to receive
payments and expect to have received back over a quarter of our
investment in repayment of principal and fees within three months
of closing. FXCM has also agreed to pay us in cash a percentage of
the proceeds received in connection with the sale of assets, any
dividend or distribution or the sale or indirect sale of FXCM’s
business as follows: 100% until all amounts due under the loan are
repaid; 50% of the next $350 million; then 90% of an amount equal
to two times the balance outstanding on the term loan as of April
16, 2015 (not to be less than $500 million or more than $680
million); and 60% of all amounts thereafter.
For more information on the Company’s results of operations for
the fourth quarter and year ended December 31, 2014, please see the
Company’s Form 10-K, which will be filed with the Securities and
Exchange Commission today. In addition, we will post on our website
in early March our Annual Shareholders’ Letter, which will include
an update on our businesses.
This press release contains “forward looking statements” within
the meaning of the safe harbor provisions of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange
Act of 1934. Forward looking statements include statements about
our future and statements that are not historical facts. These
forward looking statements are usually preceded by the words
“should,” “expect,” “intend,” “may,” “will,” or similar
expressions. Forward looking statements may contain expectations
regarding revenues, earnings, operations, and other results, and
may include statements of future performance, plans, and
objectives. Forward looking statements also include statements
pertaining to our strategies for future development of our business
and products. Forward looking statements represent only our belief
regarding future events, many of which by their nature are
inherently uncertain. It is possible that the actual results may
differ, possibly materially, from the anticipated results indicated
in these forward looking statements. Information regarding
important factors, including Risk Factors that could cause actual
results to differ, perhaps materially, from those in our forward
looking statements is contained in reports we file with the SEC.
You should read and interpret any forward looking statement
together with reports we file with the SEC.
SUMMARY FOR LEUCADIA
NATIONAL CORPORATION AND SUBSIDIARIES
(In thousands, except per share amounts) (Unaudited)
For the Three Month For the Year
Period Ended
December 31,
Ended December
31,
2014
2013
2014
2013
Net revenues
$ 2,688,355
$ 2,920,824 $
11,486,485 $
10,425,746 Net realized securities gains
(losses)
$ 9,491 $
(421 )
$ 30,394
$ 243,957 Income (loss)
from continuing operations before income taxes and income related
to associated companies $ (66,181 ) $ 1,294 $ 242,695 $ 426,544
Income related to associated companies
54,229 29,481
138,527 119,041
Income (loss) from continuing operations before income taxes
(11,952 ) 30,775 381,222 545,585 Income tax provision
2,086 29,600
165,971 136,481
Income (loss) from continuing operations (14,038 ) 1,175
215,251 409,104 Income (loss) from discontinued operations,
including gain (loss) on disposal, net of taxes
(5,586 ) (12,190
) (16,226 )
(46,911 ) Net income (loss)
(19,624 ) (11,015 ) 199,025 362,193 Net loss attributable to
the noncontrolling interest 1,294 64 727 1,162 Net loss
attributable to the redeemable noncontrolling interests 9,582
20,521 8,616 9,282 Preferred stock dividends
(1,015 ) (1,016 )
(4,062 )
(3,397 ) Net income (loss) attributable to
Leucadia National Corporation common shareholders
$
(9,763 ) $
8,554 $ 204,306
$ 369,240 Basic
earnings (loss) per common share attributable to Leucadia National
Corporation common shareholders: Income (loss) from continuing
operations $ (.01 ) $ .05 $ .58 $ 1.20 Income (loss) from
discontinued operations, including gain (loss) on disposal
(.02 )
(.03 )
(.04 ) (.13
) Net income (loss)
$ (.03 )
$ .02 $
.54 $ 1.07
Number of shares in calculation
373,617
368,146
371,889 339,673
Diluted earnings (loss) per common share attributable to
Leucadia National Corporation common shareholders: Income (loss)
from continuing operations $ (.01 ) $ .05 $ .58 $ 1.20 Income
(loss) from discontinued operations, including gain (loss) on
disposal
(.02 )
(.03
) (.04 )
(.14 ) Net income (loss)
$
(.03 )
$ .02
$ .54 $
1.06 Number of shares in calculation
373,617 368,262
373,333
347,734
Leucadia National CorporationLaura Ulbrandt, 212-460-1900
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