Press Release: LPL Financial Announces Fourth Quarter and Full Year 2020 Results
LPL Financial Announces Fourth Quarter and Full Year 2020 Results
Fourth Quarter 2020 Key Financial Results
Fourth Quarter 2020 Key Business Results
Fourth Quarter 2020 Key Capital Results
Full Year 2020 Key Performance Indicators
SAN DIEGO, Feb. 04, 2021 (GLOBE NEWSWIRE) -- LPL Financial Holdings Inc. (Nasdaq: LPLA) (the "Company") today announced results for its fourth quarter ended December 31, 2020, reporting net income of $112 million, or $1.38 per share. This compares with $127 million, or $1.53 per share, in the fourth quarter of 2019 and $104 million, or $1.29 per share, in the prior quarter.
"Throughout 2020, we remained focused on our mission of taking care of our advisors, so they can take care of their clients," said Dan Arnold, President and CEO. "This focus led us to enhance our capabilities, service, and technology, which increased the appeal of our model and contributed to new highs for total assets and organic growth. As we look ahead, we aim to continue investing in our model and increasing our market share within the advisor-centered marketplace."
"Looking at 2020, we are proud of what we accomplished within our framework to drive shareholder value," said Matt Audette, CFO. "We continued to invest through a volatile environment while staying disciplined on expenses, closed on three M&A transactions, reached an agreement to acquire Waddell & Reed's wealth management business, and delivered the highest organic net new assets in our history. Going forward, our business momentum and financial strength position us well to continue creating long-term shareholder value."
The Company's Board of Directors declared a $0.25 per share dividend to be paid on March 30, 2021 to all stockholders of record as of March 16, 2021.
Conference Call and Additional Information
The Company will hold a conference call to discuss its results at 5:00 p.m. EST on Thursday, February 4. To listen, call 877-677-9122 (domestic) or 708-290-1401 (international); passcode 9671648, or visit investor.lpl.com (webcast). Replays will be available by phone and on investor.lpl.com beginning two hours after the call and until February 11 and February 25, respectively. For telephonic replay, call 855-859-2056 (domestic) or 404-537-3406 (international); passcode 9671648.
About LPL Financial
LPL Financial is a leader in the retail financial advice market, the nation's largest independent broker-dealer(+) and a leading custodian (or provider of custodial services) to RIAs. We serve independent financial advisors and financial institutions, providing them with the technology, research, clearing and compliance services, and practice management programs they need to create and grow their practices. LPL enables them to provide objective guidance to millions of American families seeking wealth management, retirement planning, financial planning and asset management solutions. LPL.com
(+) Based on total revenues, Financial Planning magazine June 1996-2020.
Securities and advisory services offered through LPL Financial LLC, a registered investment advisor. Member FINRA/SIPC. Throughout this communication, the terms "financial advisors" and "advisors" are used to refer to registered representatives and/or investment advisor representatives affiliated with LPL Financial LLC. We routinely disclose information that may be important to shareholders in the "Investor Relations" or "Press Releases" section of our website.
**Non-GAAP Financial Measures
Management believes that presenting certain non-GAAP financial measures by excluding or including certain items can be helpful to investors and analysts who may wish to use this information to analyze the Company's current performance, prospects and valuation. Management uses this non-GAAP information internally to evaluate operating performance and in formulating the budget for future periods. Management believes that the non-GAAP financial measures and metrics discussed below are appropriate for evaluating the performance of the Company.
EPS Prior to Amortization of Intangible Assets is defined as GAAP EPS plus the per share impact of amortization of intangible assets. The per share impact is calculated as amortization of intangible assets expense, net of applicable tax benefit, divided by the number of shares outstanding for the applicable period. The Company presents EPS Prior to Amortization of Intangible Assets because management believes that the metric can provide investors with useful insight into the Company's core operating performance by excluding non-cash items that management does not believe impact the Company's ongoing operations. EPS Prior to Amortization of Intangible Assets is not a measure of the Company's financial performance under GAAP and should not be considered as an alternative to GAAP EPS or any other performance measure derived in accordance with GAAP. For a reconciliation of EPS Prior to Amortization of Intangible Assets to GAAP EPS, please see footnote 38 on page 19 of this release.
Gross Profit is calculated as total net revenues, which were $1,581 million for the three months ended December 31, 2020, less advisory and commission expenses and brokerage, clearing and exchange fees, which were $1,030 million and $18 million, respectively for the three months ended December 31, 2020. All other expense categories, including depreciation and amortization of fixed assets and amortization of intangible assets, are considered general and administrative in nature. Because the Company's Gross Profit amounts do not include any depreciation and amortization expense, the Company considers Gross Profit to be a non-GAAP financial measure that may not be comparable to similar measures used by others in its industry. Management believes that Gross Profit can provide investors with useful insight into the Company's core operating performance before indirect costs that are general and administrative in nature. For a calculation of Gross Profit, please see footnote 6 on page 16 of this release.
(MORE TO FOLLOW) Dow Jones Newswires
February 04, 2021 16:05 ET (21:05 GMT)