EX-99.1
3
a05-9093_1ex99d1.htm
EX-99.1
Exhibit 99.1
Contacts:
Rick Berry, Chief Financial Officer
Sanders Morris Harris Group Inc.
(713) 993-4614
Will Casserly, Director, Communications
Edelman Financial Services Inc.
(703) 251-0110
SANDERS MORRIS HARRIS GROUP ACQUIRES
MAJORITY INTEREST
IN PROMINENT WEALTH MANAGEMENT AND
FINANCIAL PLANNING FIRM.
FIRST QUARTER NET INCOME $0.10 PER
SHARE.
HOUSTON - May 10, 2005 - Sanders Morris Harris
Group Inc. (NASDAQ: SMHG), a leading
diversified financial services holding company, today announced that it has
purchased a 51% interest in the Edelman Financial Center, one of the largest
independent financial planning and investment management firms in the
country. Sanders Morris Harris Group
will acquire the remaining 49% over four years.
Edelman Financial Center, based in Fairfax, Virginia, manages over $2.6
billion in assets for individuals and families.
Acquiring Edelman Financial Center furthers Sanders Morris Harris Group's
position in the mass affluent market and brings the firm's total assets under
management to $10 billion.
Sanders Morris Harris
Group expects the transaction to be accretive to its current year
earnings. Edelman's 2004 revenues were
$17.7 million and its adjusted pretax income was $3.2 million. The details of the Edelman transaction are
included in an 8-K filing available today on the Company's website.
"Adding
Edelman Financial Center to our asset management group fits our strategy of
providing our clients with the full spectrum of investment opportunities and
services. We expect to leverage the
wealth management and financial planning services provided by Edelman Financial
Center across our other asset management businesses", said Robert E. Garrison
II, President of Sanders Morris Harris Group.
In
2004,
Registered Rep
Magazine
listed Edelman Financial Center founder and chairman Ric Edelman as one of "America's
Top 50 Advisors,"
Research
Magazine
ranked him the #1 advisor in the
nation for his focus on the individual client, and
Bloomberg Wealth Manager
ranked Edelman Financial Center the
largest independent financial planning and investment management firm in the
nation, based on number of clients. Edelman, a best-selling author, has
written five books on
personal finance that collectively have sold more than 1 million copies and
been translated into six languages.
George
L. Ball, Chairman of Sanders Morris Harris Group, commented, "We are delighted
that Ric Edelman and his team of high caliber professionals have elected to
join SMHG. We look forward to assisting
them as they help their clients build wealth and financial security".
Edelman,
who will remain as chairman of Edelman Financial Center, stated, "Joining the
highly qualified professionals of Sanders Morris Harris Group will enable us to
serve our clients even better while providing a solid platform for future
growth."
EARNINGS
Sanders
Morris Harris Group also reported earnings for the first quarter of 2005 of
$0.10 per diluted share versus $0.18 in the same period of 2004. Revenues were $26.3 million, down 12% from
the earlier period.
Net
income in the initial three months of 2005 was $1.8 million compared to $3.3
million in 2004. Lower stock market
trading volumes reduced profitability in the firm's institutional and prime
brokerage businesses. Investment
banking net income was also lower, reflecting industry-wide trends. Equity in income of limited partnerships
increased 111% to $1.7 million for the 2005 quarter as compared to the
comparable 2004 period, with the current year quarter benefiting from a
significant liquidity event for one of the limited partnerships.
"We
are pleased by the balanced composition of our underlying business platform,"
said Ben T. Morris, Chief Executive Officer. "The markets have become more
difficult, but we are confident the Company will continue to perform well
relative to industry conditions".
DIVIDEND
The
Company declared its regular quarterly dividend of $0.045 a share, payable July 15th
to holders of record on July 1st.
Sanders
Morris Harris Group is a diversified financial services holding company based
in Houston, Texas. It provides
investment banking services and manages over $10
billion in client assets.
Its operating entities are Sanders Morris Harris, Charlotte Capital,
Edelman Financial Center, Kissinger Financial Services, Pinnacle Trust Co.,
Salient Partners, SMH Capital Advisors and Select Sports Group. Additional information is available at
www.smhgroup.com.
In addition to the historical information, this press release contains
certain forward-looking statements under federal securities laws, including
statements regarding Sanders Morris Harris Group's expected future business
prospects, revenue and income. These forward-looking statements are based upon
current expectations and involve certain risks and uncertainties that could
cause actual results to differ materially from any such statement. These risks
and uncertainties, many of which are beyond the company's control, include but
are not limited to (1) trading volume in the securities markets; (2) volatility
of the securities markets and interest rates; (3) changes in regulatory
requirements which could affect the demand for the company's services or the
cost of doing business; (4) general economic conditions, both domestic and
foreign, especially in the regions where the company does business; (5) changes
in the rate of inflation and related impact on securities markets; (6) competition
from existing financial institutions and other new participants in the
securities markets; (7) legal developments affecting the litigation
experience of the securities industry; (8) successful implementation of
technology solutions; (9) changes in valuations of the company's trading
and warrant portfolios resulting from mark-to-market adjustments; (10) dependence
on key personnel; and (11) demand for the company's service. The company does not undertake any obligation
to update or revise any forward-looking statement
.
# # #
SANDERS MORRIS HARRIS GROUP INC.
Selected Condensed Operating Information
(in thousands, except per share amounts)
(unaudited)
Three Months
Ended
March 31,
2005
2004
Net income calculation:
Revenues
$
26,340
$
29,807
Expenses
24,151
24,762
Net
2,189
5,045
Equity in income of limited
partnerships
1,696
805
Minority interests
(797
)
(452
)
Income before income taxes
3,088
5,398
Provision for income taxes
(1,255
)
(2,128
)
Net income
$
1,833
$
3,270
Earnings per share
Basic earnings per share
$
0.10
$
0.19
Diluted earnings per share
$
0.10
$
0.18
Weighted average shares
outstanding:
Basic
18,304,652
17,394,045
Diluted
18,962,386
17,987,680
Balance sheet data:
Cash and cash equivalents
$
19,948
$
25,048
Other tangible net assets
59,961
43,968
Tangible net assets
$
79,909
$
69,016
Shareholders' equity
$
141,631
$
119,263
# # #

EX - 99 . 1 3 a05 - 9093 _ 1ex99d1 . htm EX - 99 . 1 Exhibit 99 . 1 Contacts : Rick Berry , Chief Financial Officer Sanders Morris Harris Group Inc . ( 713 ) 993 - 4614 Will Casserly , Director , Communications Edelman Financial Services Inc . ( 703 ) 251 - 0110 SANDERS MORRIS HARRIS GROUP ACQUIRES MAJORITY INTEREST IN PROMINENT WEALTH MANAGEMENT AND FINANCIAL PLANNING FIRM . FIRST QUARTER NET INCOME $ 0.10 PER SHARE . HOUSTON - May 10 , 2005 - Sanders Morris Harris Group Inc . ( NASDAQ : SMHG ) , a leading diversified financial services holding company , today announced that it has purchased a 51 % interest in the Edelman Financial Center , one of the largest independent financial planning and investment management firms in the country . Sanders Morris Harris Group will acquire the remaining 49 % over four years . Edelman Financial Center , based in Fairfax , Virginia , manages over $ 2.6 billion in assets for individuals and families . Acquiring Edelman Financial Center furthers Sanders Morris Harris Group 's position in the mass affluent market and brings the firm 's total assets under management to $ 10 billion . Sanders Morris Harris Group expects the transaction to be accretive to its current year earnings . Edelman 's 2004 revenues were $ 17.7 million and its adjusted pretax income was $ 3.2 million . The details of the Edelman transaction are included in an 8 - K filing available today on the Company 's website . " Adding Edelman Financial Center to our asset management group fits our strategy of providing our clients with the full spectrum of investment opportunities and services . We expect to leverage the wealth management and financial planning services provided by Edelman Financial Center across our other asset management businesses " , said Robert E . Garrison II , President of Sanders Morris Harris Group . In 2004 , Registered Rep Magazine listed Edelman Financial Center founder and chairman Ric Edelman as one of " America 's Top 50 Advisors , " Research Magazine ranked him the # 1 advisor in the nation for his focus on the individual client , and Bloomberg Wealth Manager ranked Edelman Financial Center the largest independent financial planning and investment management firm in the nation , based on number of clients . Edelman , a best - selling author , has written five books on personal finance that collectively have sold more than 1 million copies and been translated into six languages . George L . Ball , Chairman of Sanders Morris Harris Group , commented , " We are delighted that Ric Edelman and his team of high caliber professionals have elected to join SMHG . We look forward to assisting them as they help their clients build wealth and financial security " . Edelman , who will remain as chairman of Edelman Financial Center , stated , " Joining the highly qualified professionals of Sanders Morris Harris Group will enable us to serve our clients even better while providing a solid platform for future growth . " EARNINGS Sanders Morris Harris Group also reported earnings for the first quarter of 2005 of $ 0.10 per diluted share versus $ 0.18 in the same period of 2004 . Revenues were $ 26.3 million , down 12 % from the earlier period . Net income in the initial three months of 2005 was $ 1.8 million compared to $ 3.3 million in 2004 . Lower stock market trading volumes reduced profitability in the firm ' s institutional and prime brokerage businesses . Investment banking net income was also lower , reflecting industry - wide trends . Equity in income of limited partnerships increased 111 % to $ 1.7 million for the 2005 quarter as compared to the comparable 2004 period , with the current year quarter benefiting from a significant liquidity event for one of the limited partnerships . " We are pleased by the balanced composition of our underlying business platform , " said Ben T . Morris , Chief Executive Officer . " The markets have become more difficult , but we are confident the Company will continue to perform well relative to industry conditions " . DIVIDEND The Company declared its regular quarterly dividend of $ 0.045 a share , payable July 15 th to holders of record on July 1 st . Sanders Morris Harris Group is a diversified financial services holding company based in Houston , Texas . It provides investment banking services and manages over $ 10 billion in client assets . Its operating entities are Sanders Morris Harris , Charlotte Capital , Edelman Financial Center , Kissinger Financial Services , Pinnacle Trust Co . , Salient Partners , SMH Capital Advisors and Select Sports Group . Additional information is available at www.smhgroup.com . In addition to the historical information , this press release contains certain forward - looking statements under federal securities laws , including statements regarding Sanders Morris Harris Group 's expected future business prospects , revenue and income . These forward - looking statements are based upon current expectations and involve certain risks and uncertainties that could cause actual results to differ materially from any such statement . These risks and uncertainties , many of which are beyond the company 's control , include but are not limited to ( 1 ) trading volume in the securities markets ; ( 2 ) volatility of the securities markets and interest rates ; ( 3 ) changes in regulatory requirements which could affect the demand for the company 's services or the cost of doing business ; ( 4 ) general economic conditions , both domestic and foreign , especially in the regions where the company does business ; ( 5 ) changes in the rate of inflation and related impact on securities markets ; ( 6 ) competition from existing financial institutions and other new participants in the securities markets ; ( 7 ) legal developments affecting the litigation experience of the securities industry ; ( 8 ) successful implementation of technology solutions ; ( 9 ) changes in valuations of the company 's trading and warrant portfolios resulting from mark - to - market adjustments ; ( 10 ) dependence on key personnel ; and ( 11 ) demand for the company 's service . The company does not undertake any obligation to update or revise any forward - looking statement . # # # SANDERS MORRIS HARRIS GROUP INC . Selected Condensed Operating Information ( in thousands , except per share amounts ) ( unaudited ) Three Months Ended March 31 , 2005 2004 Net income calculation : Revenues $ 26,340 $ 29,807 Expenses 24,151 24,762 Net 2,189 5,045 Equity in income of limited partnerships 1,696 805 Minority interests ( 797 ) ( 452 ) Income before income taxes 3,088 5,398 Provision for income taxes ( 1,255 ) ( 2,128 ) Net income $ 1,833 $ 3,270 Earnings per share Basic earnings per share $ 0 . 10 $ 0 . 19 Diluted earnings per share $ 0 . 10 $ 0 . 18 Weighted average shares outstanding : Basic 18,304,652 17,394,045 Diluted 18,962,386 17,987,680 Balance sheet data : Cash and cash equivalents $ 19,948 $ 25,048 Other tangible net assets 59,961 43,968 Tangible net assets $ 79,909 $ 69,016 Shareholders ' equity $ 141,631 $ 119,263 # # #