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Raymond James Financial Annual Report, Year Ended Sep 30, 2005

Filing Date
Filed December 14, 2005
Period End
September 30, 2005
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 14, 2005. Cited figures are marked; the original filing is the authoritative source.

Raymond James Financial, Inc. (RJF) reported record fiscal 2005 results for the year ended September 30, 2005, with total revenues of $2.16 billiona and net revenues of $2.04 billion, both surpassing $2 billion for the first time in the Company's history.

Net income was $151.0 millionb, up 18% from the prior year, and diluted earnings per share were $2.00 compared with $1.72 in fiscal 2004. Growth was driven by net interest income, which rose to $127.8 million from $86.2 million, along with investment banking revenues up 41% and investment advisory fees up 17%. Pretax earnings were $248.0 million across segments, with Capital Markets and Asset Management posting pretax earnings increases of 34% and 47%, respectively, while Private Client Group earnings declined 5% due to legal expenses and settlements.

Total assets reached $8.36 billionc at September 30, 2005, up from $7.62 billion, and shareholders' equity grew to $1.24 billion from $1.07 billion. Eagle Asset Management had approximately $11.5 billion under management, and total assets under management were $30.4 billion, including $27.5 billion in third-party assets. The Company disclosed several legal and regulatory matters, including a Utah censure proceeding seeking a $100,000 fine and an SEC initial decision against RJFS in the Cranston, Rhode Island matter ordering a $6.9 million civil penalty, along with the 'Premiere 72' litigation, in which RJFS paid approximately $24 million to settle roughly 380 claimants.

Management stated that these matters were not expected to have a material adverse impact on financial position or results of operations. The Company also recorded a $6.5 milliond pretax charge to fully reserve its leveraged lease investment in an aircraft leased to Delta Airlines, which filed for bankruptcy protection on September 14, 2005.

Its Continental lease, valued at $11.8 million, remained current. The Company expects to change its fiscal reporting period to calendar quarter-ends beginning in fiscal 2006.

02—Key points

Key Highlights

  1. Record fiscal 2005 total revenues of $2.16 billion and net revenues of $2.04 billion, the first time either exceeded $2 billion.
  2. Net income of $151.0 million, up 18% from $127.6 million in fiscal 2004; diluted EPS of $2.00 versus $1.72.
  3. Net interest income rose to $127.8 million from $86.2 million, driven by higher short-term rates and a 21% increase in average margin balances.
  4. Capital Markets pretax earnings increased 34% to $77.3 million, and Asset Management pretax earnings increased 47% to $40.8 million; Private Client Group pretax earnings fell 5% to $102.2 million.
  5. Total assets of $8.36 billion and shareholders' equity of $1.24 billion at September 30, 2005; total assets under management of $30.4 billion.
  6. Legal and regulatory matters include the Premiere 72 settlement (about $24 million paid in July 2005), a Utah censure proceeding seeking a $100,000 fine, and an SEC decision ordering RJFS to pay a $6.9 million civil penalty; management does not expect these to have a material adverse impact.
  7. A $6.5 million pretax charge fully reserved the Delta aircraft leveraged lease after Delta's September 14, 2005 bankruptcy filing.

03—Questions

Frequently Asked Questions

  1. How did Raymond James perform financially in fiscal 2005?

    The Company reported record results, with total revenues of $2.16 billion and net income of $151.0 million, up 18% from the prior year. Diluted earnings per share were $2.00, compared with $1.72 in fiscal 2004.

  2. What drove the growth in revenues and profits?

    Investment banking revenues rose 41%, net interest earnings increased 48% (to $127.8 million), and investment advisory fees rose 17%. Rising short-term interest rates and a 21% increase in average margin balances contributed to higher net interest income.

  3. Which segments were weakest in fiscal 2005?

    Private Client Group pretax earnings declined 5% to $102.2 million, with management citing legal expenses and settlements. Its margin on net revenue was 7.6%, compared with 9.0% in fiscal 2004.

  4. What legal and regulatory risks did the Company disclose?

    The Company disclosed the Premiere 72 litigation, in which RJFS paid approximately $24 million to settle claims from about 380 claimants. It also disclosed a Utah proceeding seeking a $100,000 fine and an SEC initial decision ordering RJFS to pay a $6.9 million civil penalty. Management stated these matters were not expected to have a material adverse impact on financial position or results of operations.

  5. How is the Company exposed to the airline industry?

    The Company is lessor in two leveraged aircraft transactions with Delta and Continental. It recorded a $6.5 million pretax charge to fully reserve its Delta investment after Delta filed for bankruptcy on September 14, 2005. Its Continental leveraged lease was valued at $11.8 million, and Continental remained current on its lease payments.

04—Continue

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