0000791963false00007919632024-10-252024-10-25
As filed with the Securities and Exchange Commission on April 25, 2025
___________________________________________________
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934
Date of report (Date of earliest event reported): April 25, 2025
OPPENHEIMER HOLDINGS INC.
(Exact name of registrant as specified in its charter)
Commission File Number 1-12043
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| Delaware |
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98-0080034 |
| (State or other jurisdiction of |
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(I.R.S. Employer |
| incorporation or organization) |
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Identification No.) |
85 Broad Street
New York, New York 10004
(Address of principal executive offices) (Zip Code)
(212) 668-8000
(Registrant's telephone number, including area code)
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2.):
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CRF 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
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| Title of each class |
Trading Symbol |
Name of each exchange on which registered |
| Class A non-voting common stock |
OPY |
The New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
SECTION 2 – FINANCIAL INFORMATION
ITEM 2.02. Results of Operations and Financial Condition.
(a)On April 25, 2025, Oppenheimer Holdings Inc. (the “Company”) issued a press release announcing its first quarter 2025 earnings. A copy of the April 25, 2025 press release is furnished as Exhibit 99.1 to this Report and is incorporated herein by reference.
The information contained in this Item 2.02 and the related exhibit attached hereto shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall such information or such exhibit be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing. The information set forth in this Item 2.02 or any exhibit related to this Item 2.02 on this Form 8-K shall not be deemed an admission as to the materiality of any information in the referenced items.
SECTION 9 – FINANCIAL STATEMENTS AND EXHIBITS
ITEM 9.01. Financial Statements and Exhibits.
(d)Exhibits:
The following exhibit is furnished (not filed) with this Current Report on Form 8-K:
99.1 Oppenheimer Holdings Inc.'s Press Release dated April 25, 2025
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.
Oppenheimer Holdings Inc.
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Date: April 25, 2025
By: /s/ Brad M. Watkins
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Brad M. Watkins
Chief Financial Officer
(Duly Authorized Officer) |
EXHIBIT INDEX
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| Exhibit Number |
Description |
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EX-99.1
2
ex991-20258xkq1pressrelease.htm
EX-99.1
Document
Exhibit 99.1
Oppenheimer Holdings Inc. Reports First Quarter 2025 Earnings
New York, April 25, 2025 – Oppenheimer Holdings Inc. (NYSE: OPY) (the "Company" or "Firm") today reported net income of $30.7 million or $2.93 basic earnings per share for the first quarter of 2025, compared with net income of $26.1 million or $2.50 basic earnings per share for the first quarter of 2024. Revenue for the first quarter of 2025 was $367.8 million, an increase of 4.2%, compared to revenue of $353.1 million for the first quarter of 2024.
Albert G. Lowenthal, Chairman and CEO commented, "The Firm’s solid performance for the quarter underscores the ability of our diversified businesses to deliver profitable operating results in increasingly uncertain macroeconomic conditions. During the quarter, all major indices receded from prior quarter highs as the financial markets digested the new administration’s swift policy changes on trade, immigration and government spending as well as initiatives on decreased regulation. Concerns that recently enacted tariffs would likely provoke a wider trade war and spur “stagflation” – a combination of slower growth and higher inflation – produced increased volatility and lower valuations for equity securities as well as pressure on the U.S. dollar. The likelihood of a recession has increased significantly, coupled with reduced consumer confidence and expectations for higher inflation resulting from increased import prices. There are dimmed hopes for a resumption of active capital market activity with little probability of increased corporate issuances of common stock through IPOs or secondaries. Should market declines persist, this will also negatively impact our assets under management ("AUM") and fees earned from that activity. We hope that recent market turbulence will convince policy makers that recent “on-off” announcements of market-moving policy is significantly impacting likely economic outcomes and that they will significantly reduce such activity.
Notwithstanding the increasingly negative market sentiment, our Wealth Management business delivered strong results with a number of improvements over the prior year. The volatile markets spurred robust trading by our clients, driving higher retail commissions. Asset-based advisory fees also increased since AUM, while slightly reduced from recently established all-time highs, remained well above AUMs outstanding during the comparable period. A decline in our interest-sensitive revenues, partially offset these improvements due to lower short term interest rates and reduced FDIC sweep balances.
Our Capital Markets revenues exceeded prior year levels despite challenging market conditions that saw lower underwriting activity amid postponed transactions by corporate clients owing to policy uncertainties and volatile markets that put a damper on deal making activities and new issuance levels. Institutional trading volumes increased in the volatile markets seen during the latter part of the 1st quarter, which were favorable to our sales and trading revenues.
The Firm ended the quarter with record equity levels and is well-positioned for our CEO-elect, Robert Lowenthal, to take advantage of the opportunities that lie ahead. I am confident that the Firm is heading into the next era with the right leadership team that will guide the Company to its best days yet."
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| Summary Operating Results (Unaudited) |
| ('000s, except per share amounts or otherwise indicated) |
| Firm |
1Q-25 |
1Q-24 |
| Revenue |
$ |
367,825 |
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$ |
353,138 |
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| Compensation Expenses |
$ |
227,091 |
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$ |
221,713 |
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| Non-compensation Expenses |
$ |
99,358 |
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$ |
93,970 |
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| Pre-Tax Income |
$ |
41,376 |
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$ |
37,455 |
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| Income Tax Provision |
$ |
10,721 |
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$ |
11,711 |
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Net Income (1) |
$ |
30,655 |
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$ |
26,054 |
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Earnings Per Share (Basic) (1) |
$ |
2.93 |
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$ |
2.50 |
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Earnings Per Share (Diluted) (1) |
$ |
2.72 |
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$ |
2.37 |
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| Book Value Per Share |
$ |
82.87 |
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$ |
77.47 |
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Tangible Book Value Per Share (2) |
$ |
65.85 |
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$ |
60.41 |
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| Wealth Management |
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| Revenue |
$ |
241,986 |
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$ |
237,961 |
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| Pre-Tax Income |
$ |
67,864 |
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$ |
75,785 |
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| Assets Under Administration (billions) |
$ |
129.9 |
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$ |
124.9 |
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| Assets Under Management (billions) |
$ |
48.9 |
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$ |
46.6 |
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| Capital Markets |
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| Revenue |
$ |
123,261 |
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$ |
112,083 |
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| Pre-Tax Loss |
$ |
(5,097) |
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$ |
(6,702) |
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| (1) Attributable to Oppenheimer Holdings Inc. |
| (2) Represents book value less goodwill and intangible assets divided by number of shares outstanding. |
Highlights
•Increased revenue for the first quarter of 2025 was primarily driven by significantly higher advisory fees attributable to a rise in billable AUM and an increase in transaction-based commissions as well as sales and trading revenue
•Assets under administration and under management at March 31, 2025 modestly decreased below recently established records
•Compensation expenses increased from the prior year quarter largely as a result of inflationary pressures on wages and higher production-related expenses
•Non-compensation expenses increased from the prior year quarter primarily due to higher interest and technology related expenses and higher clearing and execution costs attributable to higher volumes
•Total stockholders' equity, book value and tangible book value per share reached new record highs as a result of positive earnings
Wealth Management
Wealth Management reported revenue for the current quarter of $242.0 million, 1.7% higher compared with a year ago. Pre-tax income was $67.9 million in the current quarter, a decrease of 10.5% compared with a year ago. Financial advisor headcount at the end of the current quarter was 933, compared to 936 and 931 at the end of the first quarter of 2024 and fourth quarter of 2024, respectively.
Revenue:
•Retail commissions increased 7.8% from a year ago primarily due to higher retail trading activity
•Advisory fees increased 12.2% due to higher AUM during the billing period
•Bank deposit sweep income decreased $6.6 million from a year ago due to lower cash sweep balances and lower short-term interest rates
•Interest revenue increased 6.4% from the prior year period due to higher average margin loan balances
•Other revenue decreased from a year ago primarily due to a decline in the cash surrender value of Company-owned life insurance policies, which fluctuates based on changes in the fair value of the policies' underlying investments
Assets under Management (AUM):
•AUM totaled $48.9 billion at March 31, 2025, which is the basis for advisory fee billings for April 2025
•The increase in AUM from the prior year period was comprised of higher asset values of $2.8 billion on existing client holdings, offset by net distributions of $0.5 billion
Total Expenses:
•Compensation expenses increased 3.5% from a year ago primarily due to higher production related expenses, partially offset by lower deferred compensation expenses and decreased costs associated with share appreciation rights
•Non-compensation expenses increased 16.9% from a year ago primarily due to an increase in legal expenses and higher external portfolio management costs, which are directly related to the increase in AUM
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| ('000s, except otherwise indicated) |
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1Q-25 |
1Q-24 |
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| Revenue |
$ |
241,986 |
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$ |
237,961 |
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| Commissions |
$ |
56,911 |
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$ |
52,794 |
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| Advisory Fees |
$ |
128,792 |
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$ |
114,836 |
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| Bank Deposit Sweep Income |
$ |
30,075 |
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$ |
36,685 |
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| Interest |
$ |
21,485 |
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$ |
20,196 |
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| Other |
$ |
4,723 |
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$ |
13,450 |
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| Total Expenses |
$ |
174,122 |
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$ |
162,176 |
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| Compensation |
$ |
119,648 |
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$ |
115,572 |
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| Non-compensation |
$ |
54,474 |
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$ |
46,604 |
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| Pre-Tax Income |
$ |
67,864 |
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$ |
75,785 |
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| Compensation Ratio |
49.4 |
% |
48.6 |
% |
| Non-compensation Ratio |
22.5 |
% |
19.6 |
% |
| Pre-Tax Margin |
28.0 |
% |
31.8 |
% |
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| Assets Under Administration (billions) |
$ |
129.9 |
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$ |
124.9 |
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| Assets Under Management (billions) |
$ |
48.9 |
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$ |
46.6 |
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| Cash Sweep Balances (billions) |
$ |
2.9 |
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$ |
3.2 |
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Capital Markets
Capital Markets reported revenue for the current quarter of $123.3 million, 10.0% higher when compared with the prior year period. Pre-tax loss was $5.1 million compared with a pre-tax loss of $6.7 million a year ago.
Revenue:
Investment Banking
•Advisory fees earned from investment banking activities decreased 18.5% compared with a year ago primarily due to fewer private placement transactions
•Equities underwriting fees were flat when compared to the prior year period
•Fixed income underwriting fees increased 116.6% compared with the prior year period primarily due to higher public finance transaction revenue
Sales and Trading
•Equities sales and trading revenue increased 37.9% compared with the prior year period mostly due to higher trading volumes and greater options-related revenue
•Fixed income sales and trading revenue increased 5.2% compared with a year ago largely due to higher interest income on trading inventory
Total Expenses:
•Compensation expenses increased 7.1% compared with a year ago largely due to costs associated with opportunistic new hires and greater production related expense
•Non-compensation expenses were 10.3% higher than a year ago primarily due to an increase in communication and technology expenses and execution-related fees
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| ('000s) |
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1Q-25 |
1Q-24 |
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| Revenue |
$ |
123,261 |
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$ |
112,083 |
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| Investment Banking |
$ |
44,980 |
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$ |
47,918 |
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| Advisory Fees |
$ |
25,962 |
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$ |
31,868 |
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| Equities Underwriting |
$ |
13,399 |
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$ |
13,179 |
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| Fixed Income Underwriting |
$ |
5,301 |
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$ |
2,447 |
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| Other |
$ |
318 |
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$ |
424 |
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| Sales and Trading |
$ |
76,879 |
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$ |
63,659 |
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| Equities |
$ |
41,744 |
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$ |
30,266 |
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| Fixed Income |
$ |
35,135 |
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$ |
33,393 |
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| Other |
$ |
1,402 |
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$ |
506 |
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| Total Expenses |
$ |
128,358 |
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$ |
118,785 |
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| Compensation |
$ |
87,344 |
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$ |
81,588 |
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| Non-compensation |
$ |
41,014 |
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$ |
37,197 |
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| Pre-Tax Loss |
$ |
(5,097) |
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$ |
(6,702) |
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| Compensation Ratio |
70.9 |
% |
72.8 |
% |
| Non-compensation Ratio |
33.3 |
% |
33.2 |
% |
| Pre-Tax Margin |
(4.1) |
% |
(6.0) |
% |
Other Matters
•The Board of Directors announced a quarterly dividend of $0.18 per share payable on May 23, 2025 to holders of Class A non-voting and Class B voting common stock of record on May 9, 2025
•Compensation expense as a percentage of revenue at 61.7% was relatively flat with the same period last year
•The effective tax rate for the current period was 25.9% compared with 31.3% for the prior year period. The effective tax rate for the first quarter of 2025 was positively impacted by fewer non-deductible expenses and a higher tax benefit upon the vesting of share awards
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| (In millions, except number of shares and per share amounts) |
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1Q-25 |
1Q-24 |
| Capital |
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Stockholders' Equity (1) |
$ |
872.3 |
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$ |
801.5 |
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Regulatory Net Capital (2) |
$ |
384.1 |
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$ |
431.4 |
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Regulatory Excess Net Capital (2) |
$ |
355.4 |
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$ |
412.6 |
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| Common Stock Repurchases |
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| Repurchases |
$ |
0.1 |
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$ |
8.4 |
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| Number of Shares |
1,530 |
|
214,723 |
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| Average Price |
$ |
58.79 |
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$ |
39.05 |
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| Period End Shares |
10,525,495 |
10,346,862 |
| Effective Tax Rate |
25.9 |
% |
31.3 |
% |
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(1) Attributable to Oppenheimer Holdings Inc. |
(2) Attributable to Oppenheimer & Co. Inc. broker-dealer |
Company Information
Oppenheimer Holdings Inc., through its operating subsidiaries, is a leading middle market investment bank and full service broker-dealer that is engaged in a broad range of activities in the financial services industry, including retail securities brokerage, institutional sales and trading, investment banking (corporate and public finance), equity and fixed income research, market-making, trust services, and investment advisory and asset management services. With roots tracing back to 1881, the Company is headquartered in New York and has 89 retail branch offices in the United States and institutional businesses located in London, Tel Aviv, and Hong Kong.
Forward-Looking Statements
This press release includes certain "forward-looking statements" relating to anticipated future performance. For a discussion of the factors that could cause future performance to be different than anticipated, reference is made to Factors Affecting "Forward-Looking Statements" and Part 1A – Risk Factors in the Company's Annual Report on Form 10-K for the year ended December 31, 2024.
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| Oppenheimer Holdings Inc. |
| Consolidated Income Statements (Unaudited) |
| ('000s, except number of shares and per share amounts) |
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For the Three Months Ended
March 31, |
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2025 |
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2024 |
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% Change |
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| REVENUE |
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Commissions |
$ |
110,878 |
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$ |
95,850 |
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15.7 |
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Advisory fees |
128,803 |
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|
114,847 |
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12.2 |
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Investment banking |
47,623 |
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50,537 |
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(5.8) |
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Bank deposit sweep income |
30,075 |
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36,685 |
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(18.0) |
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Interest |
36,369 |
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|
26,766 |
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35.9 |
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Principal transactions, net |
8,975 |
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18,234 |
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(50.8) |
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Other |
5,102 |
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10,219 |
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(50.1) |
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Total revenue |
367,825 |
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|
353,138 |
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4.2 |
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| EXPENSES |
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Compensation and related expenses |
227,091 |
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221,713 |
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2.4 |
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Communications and technology |
26,182 |
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24,576 |
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6.5 |
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Occupancy and equipment costs |
16,009 |
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15,848 |
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1.0 |
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Clearing and exchange fees |
7,752 |
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|
5,842 |
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32.7 |
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Interest |
21,396 |
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|
20,548 |
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4.1 |
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Other |
28,019 |
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27,156 |
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3.2 |
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Total expenses |
326,449 |
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|
315,683 |
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3.4 |
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| Pre-Tax Income |
41,376 |
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|
37,455 |
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10.5 |
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| Income tax provision |
10,721 |
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|
11,711 |
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(8.5) |
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| Net Income |
$ |
30,655 |
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$ |
25,744 |
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19.1 |
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| Less: Net loss attributable to non-controlling interest, net of tax |
— |
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(310) |
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* |
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| Net income attributable to Oppenheimer Holdings Inc. |
$ |
30,655 |
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$ |
26,054 |
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17.7 |
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| Earnings per share attributable to Oppenheimer Holdings Inc. |
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Basic |
$ |
2.93 |
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|
$ |
2.50 |
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17.2 |
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Diluted |
$ |
2.72 |
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$ |
2.37 |
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|
14.8 |
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| Weighted average number of common shares outstanding |
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Basic |
10,465,771 |
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|
10,407,454 |
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|
0.6 |
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Diluted |
11,277,939 |
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|
11,001,669 |
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2.5 |
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| Period end number of common shares outstanding |
10,525,495 |
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10,346,862 |
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1.7 |
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* Percentage not meaningful
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