LOS ANGELES, May 19, 2025 /PRNewswire/ -- B. Riley Securities Holdings, Inc. ("B. Riley Securities," "BRS" or the "Company"), a leading middle market investment bank, today provided a business and financial update following its previously announced carve-out transaction with B. Riley Financial, Inc. ("BRF"), and in anticipation of BRS' future filings of financial statements and quotation on the OTC Markets.
Andy Moore, Chairman and Co-CEO, B. Riley Securities, stated:
"We remain relentlessly focused on delivering for our clients. With our previously announced carve-out from BRF, we are able to provide greater financial transparency and a clearer view into the underlying strength of our business. We are committed to providing our stakeholders with increased visibility into our strategy and vision for value creation. Although transactional activity has been tempered by macro uncertainty, volatility has often presented compelling opportunities for us to gain market share with differentiated, client-focused execution. As a trusted partner to middle market companies and those who invest in them, we take a long-term view in positioning BRS for sustainable growth and maximizing shareholder value."
Jimmy Baker, Co-CEO & Head of Capital Markets at B. Riley Securities, commented:
"We are proud of how our team navigated a challenging 2024. Over the course of last year, we raised $16.5 billion in debt and equity on behalf of our clients and expanded our capabilities in key areas including Convertibles and Liability Management. In addition, our advisory practice is now more closely aligned with our core clients' interests with a sharpened strategic focus on Capital Markets. We have also continued to invest in talent across Equity Research, Sales & Trading, and Investment Banking. It will take time for the full impact of our previously announced carve-out and the contribution of our new team members to materialize in our financial results. Our focus remains firmly on long-term value creation and making BRS a destination for top middle market talent while creating opportunities for growth and leadership within our firm."
Adjusted Year 2024 Financial Highlights
On an adjusted basis, BRS delivered total revenue of $217.7 million, adjusted net revenue of $211.0 million, a net loss of $14.5 million, and adjusted net income of $33.1 million.
The adjusted basis referred to gives effect to the March 2025 contributions of Cascadia Investments Inc. (OTCMKTS: CDIV) and other subsidiaries to BRS as part of the carve-out, as if those contributions had been completed on January 1, 2024. For a reconciliation of non-GAAP measures to their corresponding GAAP measures and additional disclosures, see "Note Regarding Use of Non-GAAP Financial Measures" and the tables below.
In January 2025, the Company repaid all $12.4 million of its outstanding debt.
Reflecting primarily the impact of pre-carve out distributions to BRF, losses pertaining to a legacy investment, cash use in connection with year-end compensation and repayment of debt as discussed above, BRS stands completely debt-free with $68 million in cash and securities owned as of the carve-out effective date.
About B. Riley Securities $(BRS.UK)$
BRS provides a full suite of investment banking and capital markets services to corporations, financial sponsors, and institutional investors across all industry verticals. Investment banking services include initial, secondary, and follow-on offerings, institutional private placements, merger and acquisition (M&A) advisory, SPACs, corporate restructuring and liability management. Widely recognized for its thematic proprietary equity research, clients benefit from BRS' extensive network, industry expertise, and proven execution capabilities of its end-to-end financial services platform. For more information, visit www.brileysecurities.com.
Note Regarding Use of Non-GAAP Financial Measures
Certain information set forth herein, including adjusted net revenue and adjusted net income (loss), may be considered non-GAAP financial measures. B. Riley Securities believes this information is useful to investors because it provides a basis for measuring the operating performance of the Company's business and its revenues and cash flow, (i) excluding in the case of adjusted net revenue, trading gains (losses) on legacy investment positions (net of "regular way" fixed income trading revenue) and fair value adjustments on loans, and including Securities Lending interest expense and (ii) excluding in the case of adjusted net income, fair value adjustments, stock-based compensation, trading gains (losses) on legacy investment positions (net of "regular way" fixed income trading revenue), fair value adjustments on loans and other investment-related expenses, and including the estimated related tax expense or benefit on the aforementioned adjustments, 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, management compensation, 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 SECURITIES HOLDINGS, INC.
Condensed Consolidated Balance Sheet as of December 31, 2024
(Unaudited)
(in thousands)
Other wholly owned As Adjusted
B. Riley Securities, unaudited B. Riley Securities
Inc. (1) subsidiaries (2) Holdings, Inc.
--------------------------- ----------------------------- ---------------------------
Assets:
Cash and cash
equivalents $ 40,926 $ 1,213 $ 42,139
Receivables 70,006 (36,298) 33,708
Securities
borrowed 43,022 - 43,022
Securities
owned, at
fair value 77,758 938 78,696
Operating
lease right
of use asset 6,884 1,721 8,605
Goodwill and
intangibles 113,914 24,990 138,904
Property and
equipment,
net 2,049 - 2,049
Prepaid
expenses and
other assets 2,387 - 2,387
Total assets $ 356,946 $ (7,436) $ 349,510
=========================== ============================= ===========================
Liabilities:
Securities
loaned $ 27,942 $ - $ 27,942
Financial
instruments
sold, not yet
purchased,
at fair
value 5,675 - 5,675
Note payable 12,379 - 12,379
Accrued
compensation
and benefits 26,822 253 27,075
Accounts
payable and
accrued
expenses 16,021 (1,279) 14,742
Operating
lease
liabilities 8,293 2,288 10,581
Total
liabilities 97,132 1,262 98,394
=========================== ============================= ===========================
Equity 259,814 (8,698) 251,116
=========================== ============================= ===========================
Total
liabilities &
equity $ 356,946 $ (7,436) $ 349,510
=========================== ============================= ===========================
1) Focus report audit of B. Riley Securities as of and for the year ended
December 31, 2024.
2) Reflects the contribution of Cascadia Investments Inc. and other immaterial
subsidiaries contributed to B. Riley Securities Holdings, Inc. as if the March
2025 contribution was made on December 31, 2024.
B. RILEY SECURITIES HOLDINGS, INC.
Condensed Consolidated Statements of Operations
Year Ended December 31, 2024
(Unaudited)
(in thousands)
Other wholly owned As Adjusted
B. Riley Securities, unaudited B. Riley Securities
Inc. (1) subsidiaries (2) Holdings, Inc.
--------------------------- ---------------------------- ---------------------------
Revenues
Investment
banking: $ 146,887 $ 7,045 $ 153,932
Institutional
brokerage (18,824) (556) (19,380)
Interest 78,229 76 78,305
Other income 3,866 945 4,811
Total revenues $ 210,158 $ 7,510 $ 217,668
=========================== ============================ ===========================
Expenses
Compensation and
benefits $ 117,745 $ 1,363 $ 119,108
Interest 66,518 - 66,518
Other operating
expenses 47,947 3,456 51,403
--------------------------- ----------------------------
Total expenses 232,210 4,819 237,029
--------------------------- ---------------------------- ---------------------------
Operating net
income (loss) (22,052) 2,691 (19,361)
--------------------------- ---------------------------- ---------------------------
Other
income/expense - (515) (515)
--------------------------- ---------------------------- ---------------------------
Net income
(loss) before
income taxes (22,052) 2,176 (19,876)
Income tax
(benefit)
expense (5,954) 587 (5,367)
Net income
(loss) $ (16,098) $ 1,589 $ (14,509)
=========================== ============================ ===========================
1) Focus report audit of B. Riley Securities as of and for the year ended
December 31, 2024.
2) Reflects the contribution of Cascadia Investments Inc. and other immaterial
subsidiaries contributed to the group subsequent to December 31, 2024.
B. RILEY SECURITIES HOLDINGS, INC.
Reconciliation of GAAP to Adjusted Full Year 2024 Results
(Unaudited)
(in thousands)
Other wholly owned As Adjusted
B. Riley Securities, unaudited B. Riley Securities
Inc. (1) subsidiaries (2) Holdings, Inc.
--------------------------- ---------------------------- ---------------------------
Reconciliation of
GAAP to adjusted
financials:
GAAP revenue $ 210,158 $ 7,510 $ 217,668
Adjustments:
Legacy positions
losses (gains) (3) 59,182 556 59,738
Loans at fair value 63 - 63
Committed equity
facility gains
(losses) - (515) (515)
Total adjustments 59,245 41 59,286
--------------------------- ---------------------------- ---------------------------
Adjusted revenue 269,403 7,551 276,954
Securities lending
interest expense (65,939) - (65,939)
Adjusted net revenue
(a non-GAAP figure) $ 203,464 $ 7,551 $ 211,015
=========================== ============================ ===========================
Net income $ (16,098) $ 1,589 $ (14,509)
Adjustments:
Fair value adjustment
of contingent
acquisition
consideration (379) - (379)
Share based
compensation 5,757 - 5,757
Legacy positions
losses (gains) (3) 59,182 556 59,738
Loans at fair value 63 - 63
Income tax-effect of
above non-GAAP
adjustments and
certain discrete tax
items (17,448) (150) (17,598)
Adjusted net income $ 31,077 $ 1,995 $ 33,072
=========================== ============================ ===========================
1) Focus report audit of B. Riley Securities as of and for the year ended
December 31, 2024.
2) Reflects the contribution of Cascadia Investments Inc. and other immaterial
subsidiaries contributed to the group subsequent to December 31, 2024.
3) Legacy investment positions held at BRS that are not, following the
carve-out, part of BRS' go-forward strategy.
Contact:
Jo Anne McCusker
B. Riley Securities
press@brileysecurities.com
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SOURCE B. Riley Securities
(END) Dow Jones Newswires
May 19, 2025 17:36 ET (21:36 GMT)
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