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Raymond James Financial Annual Report, Year Ended Sep 26, 2003

Filing Date
Filed December 23, 2003
Period End
September 26, 2003
Security
RJF
In the record · 2016–202610-K1010-Q338-K266

RJF filed 10 annual reports (10-K), 33 quarterly reports (10-Q) and 266 current reports (8-K) between 2016 and 2026.

  1. Material agreement8-K · May ’17May ’17
  2. Leadership change8-K · Dec ’19Dec ’19
  3. Leadership change8-K · Dec ’21Dec ’21
  4. FY2025 annual report10-K · Nov ’25Nov ’25

01—Abstract

Summary

Summary of the 10-K filed December 23, 2003. Cited figures are marked; the original filing is the authoritative source.

Raymond James Financial, Inc. reported net income of $86.3 milliona, or $1.76 per diluted share, for the fiscal year ended September 26, 2003, up from $79.3 million, or $1.60 per diluted share, in fiscal 2002.

Total revenues declined $19.9 millionb, or 1%, to $1.50 billion, while net revenues increased $10.9 million, or 1%, to $1.45 billion. The filing attributes the net income increase primarily to lower net litigation reserve expense, partly offset by higher compensation expense. Net interest income fell as declining interest rates and lower margin and stock lending balances reduced interest revenue.

Segment performance was mixed. Private Client Group pre-tax earnings were roughly flat at $73.4 millionc, Capital Markets pre-tax earnings were $37.5 million, Asset Management pre-tax earnings fell to $18.7 million, and RJBank pre-tax earnings rose to $10.2 million. Total assets grew to $6.91 billion from $6.04 billion, and shareholders' equity rose to $924.7 million.

Assets under management reached $18.77 billiond, up 23%, driven by Eagle Asset Management's growth. The principal risks disclosed center on legal and regulatory matters.

The company faces claims tied to the Premiere 72 mortgage lending program, a $12.5 million misappropriation suit against RJFS, and an NASD and SEC preliminary recommendation of enforcement action over mutual fund breakpoint discounts, with a potential penalty of up to $6.5 million. Management states that ultimate resolution of pending litigation is not expected to have a material adverse impact on financial position or results of operations.

02—Key points

Key Highlights

  1. Net income rose $7 million, or 9%, to $86.3 million ($1.76 diluted EPS) from $79.3 million ($1.60) in fiscal 2002, mainly due to lower net litigation reserve expense.
  2. Total revenues were $1.50 billion, down 1%, while net revenues increased $10.9 million, or 1%, to $1.45 billion.
  3. Net interest income declined to $82.1 million from $83.5 million as interest rates fell and margin and stock-lending balances shrank.
  4. Assets under management reached $18.77 billion, up 23%, led by Eagle Asset Management at $6.32 billion, up 39%.
  5. Total assets were $6.91 billion and shareholders' equity was $924.7 million at September 26, 2003; the company repurchased 1,444,537 shares during 2003 at an average price of $24.90.
  6. Pending regulatory matter: RJA and RJFS were advised of a preliminary recommendation for enforcement action over breakpoint discounts, with a possible penalty of up to $6.5 million; estimated customer breakpoint refunds total $6,875,000.
  7. Quarterly cash dividends were $0.09 per share in each quarter of fiscal 2003, unchanged from fiscal 2002.

03—Questions

Frequently Asked Questions

  1. How did Raymond James perform financially in fiscal 2003?

    Net income was $86.3 million, or $1.76 per diluted share, compared with $79.3 million, or $1.60 per diluted share, in fiscal 2002. Net revenues rose 1% to $1.45 billion, and the filing attributes the earnings increase mainly to lower net litigation reserve expense.

  2. What are the main legal and regulatory risks disclosed?

    The company is defending the Premiere 72 mortgage lending program claims, which involve about 604 claimants and a bankruptcy trustee claim, and a $12.5 million misappropriation suit against RJFS. It also faces a preliminary SEC and NASD recommendation of enforcement action over mutual fund breakpoint discounts, with a possible penalty of up to $6.5 million. Management believes the ultimate outcome will not have a material adverse impact on financial position or results of operations, though results in a future period could be affected.

  3. How did the company's business segments perform?

    Private Client Group pre-tax earnings were $73.4 million, up slightly from $72.5 million. Capital Markets earned $37.5 million, Asset Management $18.7 million (down from $20.3 million), and RJBank $10.2 million (up from $7.2 million).

  4. How is the company's balance sheet and capital position?

    Total assets were $6.91 billion and shareholders' equity was $924.7 million at September 26, 2003. RJBank was categorized as well capitalized, and the company had $167.2 million in total borrowings, including a $47 million headquarters mortgage and a $60 million term loan.

  5. What is the outlook for Raymond James's earnings drivers?

    The filing notes that the second half of fiscal 2003 showed modest economic improvement and renewed equity market strength, which supported commission revenue. It also cautions that recent performance may not continue, citing concerns about the U.S. economy, rising budget and trade deficits, and possible higher government interest expense when the Federal Reserve raises rates.

04—Continue

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