National Financial Partners Corp. has a market cap of $473.6 million; its shares were traded at around $11.1 with a P/E ratio of 4.8 and P/S ratio of 0.5. NFP is in the portfolios of Private Capital of Private Capital Management, Jim Simons of Renaissance Technologies LLC, Steven Cohen of SAC Capital Advisors.
Highlight of Business Operations:Income from operations increased $621.2 million or 106.6% to $38.4 million for the six month period ended June 30, 2010 from a loss of $(582.8) million for the six months ended June 30, 2009. The increase in income from operations was driven by the significant decline in impairments from $610.2 million in the six months ended June 30, 2009 to $2.9 million for the six months ended June 30, 2010. Excluding the impact of impairments, the Company s income from operations improved primarily due to increases in revenues at the CCG and ASG and an increase in gain on sale of businesses at the CCG offset by decrease in revenues at the ICG. In addition, compensation expense decreased in each of the three segments, but these declines were offset by increases in non-compensation expenses and management fees. Income from operations in the CCG and ICG also benefited from declines in amortization and depreciation costs. The decline in impairments was driven by the significant impairment taken during the three months ended March 31, 2009 that reflected the incorporation of market data, including NFP s market value which had remained below net book value for a sustained period through March 31, 2009, the performance of the Company in the economic environment in late 2008 through 2009, and discount rates that were risk adjusted to reflect both company-specific and market-based credit spreads and other relevant market data. Among other significant factors, the market value in the prior year period reflected the stressed macroeconomic environment and its impact on the Company s sales.
In connection with its delivery of corporate benefits products and services, the CCG s clients range from businesses with employees in the single digits to businesses employing thousands, with a focus on middle-market businesses employing between 50 and 1,000 employees. In connection with its distribution of executive benefits products and services, the CCG actively works with Fortune 2000 companies, while also serving businesses employing between 200 and 2,000 employees. In the sale of bank-owned life insurance, the CCG targets community banks that hold between $100 million and $5 billion of assets.
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