LOS ANGELES, Jan. 22, 2020 /PRNewswire/ -- B. Riley
Financial, Inc. (NASDAQ:RILY) (the "Company" or "B. Riley"), a
diversified provider of business advisory and financial services
which operates through several wholly-owned subsidiaries, today
released guidance for the fourth quarter of 2019 and raised its
guidance for the full year ended December
31, 2019.
Preliminary Results for Q4 2019
- Net income range of $15.0 to
$17.0 million
- Adjusted EBITDA in the range of $47.5 to $51.5
million
Preliminary Results for Full Year 2019
- Net income of $79.5 million to
$81.5 million
- Adjusted EBITDA of $205.1 million
to $209.1 million
"Our preliminary fourth quarter results include strong
performance in our capital markets segment driven by investment
banking activity and proprietary investment gains. The strength in
capital markets was offset by an accrual of the total estimated
loss we expect to incur on the completion of a large liquidation
project. We are pleased that despite a setback in our liquidation
group, we anticipate exceeding the mid-range of our prior guidance
from September 2019 by approximately
$47 million for adjusted EBITDA and
$28 million for net income. As we
enter 2020, we are seeing more opportunities than ever to leverage
our platform and we remain optimistic about our ability to
accelerate B. Riley's forward momentum as we look ahead," said
Bryant Riley, Chairman and Co-Chief
Executive Officer, B. Riley Financial.
Based on preliminary, unaudited results for the fourth quarter
of 2019, the Company expects to report adjusted EBITDA in the range
of $47.5 to $51.5 million and net income in the range of
$15.0 to $17.0
million.
For the full year of 2019, the Company expects to report
adjusted EBITDA in the range of $205.1 to $209.1
million and net income in the range of $79.5 to $81.5
million, exceeding its prior guidance of adjusted EBITDA in
the range of $150 to $170 million and net income in the range of
$45 to $60
million. The mid-range of the Company's updated 2019
guidance represents a significant year-over-year increase of over
100 percent for adjusted EBITDA and over 400 percent in net income
compared to reported results for the full year of 2018.
Actual results for the fourth quarter and full year of 2019 may
differ from these estimates. The Company is currently performing
its customary year-end closing, review and audit procedures and
intends to report its fourth quarter and full year 2019 financial
results in late February.
Repurchase of Common Stock
The Company also announced
it has agreed to repurchase 880,000 shares of its common stock in a
block purchase from an existing stockholder as part of a
privately-negotiated transaction. The Company has agreed to
purchase the shares at $24.4725 per
share for an aggregate amount of approximately $21.5 million.
Riley commented, "Our share repurchase program is an integral
part of our capital allocation strategy and these opportunistic
share repurchases directly reflect our continued focus on
increasing shareholder value. With this transaction, we have
repurchased approximately 2.8 million shares and warrants since
January 2018 which represent an
amount equivalent to approximately 10 percent of our outstanding
shares."
For more information, visit ir.brileyfin.com.
About B. Riley Financial, Inc. (NASDAQ:RILY)
B. Riley
Financial provides collaborative financial services tailored to fit
the capital raising and business advisory needs of public and
private companies and high-net-worth individuals. B. Riley operates
through several wholly-owned subsidiaries which offer complementary
end-to-end capabilities spanning investment banking and
institutional brokerage, private wealth and investment management,
corporate advisory, restructuring, due diligence, forensic
accounting and litigation support, appraisal and valuation, and
auction and liquidation services. Certain registered affiliates of
B. Riley originate and underwrite senior secured loans for
asset-rich companies. The Company also makes proprietary
investments in companies and assets with attractive return
profiles. For more information, visit www.brileyfin.com.
Forward-Looking Statements
Statements in this press
release that are not descriptions of historical facts are
forward-looking statements that are based on management's current
expectations and assumptions and are subject to risks and
uncertainties. If such risks or uncertainties materialize or such
assumptions prove incorrect, our business, operating results,
financial condition and stock price could be materially negatively
affected. You should not place undue reliance on such
forward-looking statements, which are based on the information
currently available to us and speak only as of the date of this
press release. Such forward looking statements include, but are not
limited to, statements regarding the Company's anticipated results
of operations for the fourth quarter and full year 2019, as well as
statements regarding our excitement and the expected growth of our
business segments. Factors that could cause such actual results to
differ materially from those contemplated or implied by such
forward-looking statements include (without limitation) those risks
described from time to time in B. Riley Financial, Inc.'s periodic
filings with the SEC, including, without limitation, the risks
described in B. Riley Financial, Inc.'s Annual Report on Form 10-K
for the year ended December 31, 2018
under the captions "Risk Factors" and "Management's Discussion and
Analysis of Financial Condition and Results of Operations."
Additional information will be set forth in our Quarterly Report on
Form 10-Q for the quarter ended December 31,
2019. These factors should be considered carefully, and
readers are cautioned not to place undue reliance on such
forward-looking statements. All information is current as of the
date this press release is issued, and B. Riley Financial, Inc.
undertakes no duty to update this information.
Note Regarding Use of Non-GAAP Financial
Measures
Certain of the information set forth herein,
including adjusted net income and adjusted EBITDA, may be
considered non-GAAP financial measures. B. Riley Financial believes
this information is useful to investors because it provides a basis
for measuring the Company's available capital resources, the
operating performance of its business and its cash flow, excluding
net interest expense, provisions for or benefit from income taxes,
depreciation, amortization, fair value adjustment, transaction and
other expenses, restructuring costs, and stock-based compensation
that would normally be included in the most directly comparable
measures calculated and presented in accordance with Generally
Accepted Accounting Principles ("GAAP"). In addition, the Company's
management uses these non-GAAP financial measures along with the
most directly comparable GAAP financial measures in evaluating the
Company's operating performance, capital resources and cash flow.
Non-GAAP financial measures should not be considered in isolation
from, or as a substitute for, financial information presented in
compliance with GAAP, and non-financial measures as reported by the
Company may not be comparable to similarly titled amounts reported
by other companies.
B. RILEY
FINANCIAL, INC. AND SUBSIDIARIES
|
Reconciliation of
Net Income Guidance to Adjusted EBITDA Guidance
|
Three Months Ended
December 31, 2019
|
(Unaudited)
|
(Dollars in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
Guidance
|
|
|
|
|
|
|
|
Low
|
|
High
|
Net income
attributable to B. Riley Financial, Inc. (guidance)
|
$
|
15,000
|
|
$
|
17,000
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments
(guidance):
|
|
|
|
|
|
|
Provision for income
taxes
|
|
7,500
|
|
|
8,500
|
|
Interest
expense
|
|
15,000
|
|
|
15,000
|
|
Interest
income
|
|
(200)
|
|
|
(200)
|
|
Share based
payments
|
|
5,400
|
|
|
5,900
|
|
Depreciation and
amortization
|
|
4,800
|
|
|
5,300
|
|
Restructuring
expense
|
|
—
|
|
|
—
|
|
Transactions related
costs
|
|
—
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total EBITDA
adjustments
|
|
32,500
|
|
|
34,500
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
(guidance)
|
$
|
47,500
|
|
$
|
51,500
|
B. RILEY
FINANCIAL, INC. AND SUBSIDIARIES
|
Reconciliation of
Net Income Guidance to Adjusted EBITDA Guidance
|
Twelve Months
Ended December 31, 2019
|
(Unaudited)
|
(Dollars in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
Guidance
|
|
|
|
|
|
|
|
Low
|
|
High
|
Net income
attributable to B. Riley Financial, Inc. (guidance)
|
$
|
79,482
|
|
$
|
81,482
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments
(guidance):
|
|
|
|
|
|
|
Provision for income
taxes
|
|
34,302
|
|
|
35,302
|
|
Interest
expense
|
|
50,130
|
|
|
50,130
|
|
Interest
income
|
|
(1,529)
|
|
|
(1,529)
|
|
Share based
payments
|
|
15,676
|
|
|
16,176
|
|
Depreciation and
amortization
|
|
19,017
|
|
|
19,517
|
|
Restructuring
expense
|
|
1,699
|
|
|
1,699
|
|
Transactions related
costs
|
|
6,339
|
|
|
6,339
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total EBITDA
adjustments
|
|
125,634
|
|
|
127,634
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
(guidance)
|
$
|
205,116
|
|
$
|
209,116
|
Contacts
|
|
|
|
Investors
|
Media
|
B. Riley
Financial
|
Jo Anne
McCusker
|
ir@brileyfin.com
|
jmccusker@brileyfin.com
|
(310)
966-1444
|
(646)
885-5425
|
View original content to download
multimedia:http://www.prnewswire.com/news-releases/b-riley-financial-releases-guidance-for-fourth-quarter-raises-guidance-for-full-year-2019-300990918.html
SOURCE B. Riley Financial