LaBranche & Co Inc. (LAB, Financial) filed Quarterly Report for the period ended 2009-06-30.
LABRANCHE & CO is a holding company that is the sole member of LaBranche Co. LLC and owns all the outstanding stock of Henderson Brothers Inc. They are a specialist firm on the NYSE. Their Henderson Brothers Inc. subsidiary is a clearing broker for customers of several introducing brokers and provides direct access floor brokerage services to institutional customers. As a NYSE specialist their role is to maintain as far as practicable a fair and orderly market in their specialist stocks. LaBranche & Co Inc. has a market cap of $227.6 million; its shares were traded at around $4.11 with a P/E ratio of 12.1 and P/S ratio of 1.
Overall, our operating companies showed a combined pro forma pre-tax loss of $2.0 million in the second quarter of 2009. These losses, when combined with the expenses at our holding company (the biggest of which is the $5.4 million interest on our public debt for the quarter), resulted in the pro-forma operating loss for the second quarter of 2009.
We repurchased $10.0 million of our public debt in the second quarter of 2009, which further reduced our annual interest payments related to this debt to $20.8 million from approximately $21.9 million as of December 31, 2008. Historically, the operating expense related to our outstanding debt has been the negative carry on our debt, which is the interest we pay on our outstanding indebtedness, less the interest income we receive as a result of having that cash on-hand. Our negative carry following our repurchase of debt in the second quarter of 2009 was reduced to approximately $5.4 million per quarter, based on current short-term interest rates.
Due to the value we continue to see in our common stock, in July 2009 our board of directors increased the $40.0 million share repurchase program we previously announced by $25.0 million, making the total authorization under the share repurchase program $65.0 million. Following this increase and repurchases made to date under the repurchase plan, there are approximately $29.5 million in shares of common stock remaining that may be repurchased under the repurchase plan. The repurchase program may be implemented from time to time in the open market, in privately negotiated transactions or otherwise, in compliance with applicable state and federal securities laws. The timing and amounts of any purchases will be based on market conditions and other factors, including price, regulatory requirements, debt covenant compliance and capital availability. We may suspend, modify or discontinue the share repurchase program at any time.
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LABRANCHE & CO is a holding company that is the sole member of LaBranche Co. LLC and owns all the outstanding stock of Henderson Brothers Inc. They are a specialist firm on the NYSE. Their Henderson Brothers Inc. subsidiary is a clearing broker for customers of several introducing brokers and provides direct access floor brokerage services to institutional customers. As a NYSE specialist their role is to maintain as far as practicable a fair and orderly market in their specialist stocks. LaBranche & Co Inc. has a market cap of $227.6 million; its shares were traded at around $4.11 with a P/E ratio of 12.1 and P/S ratio of 1.
Highlight of Business Operations:
For the second quarter of 2009, our after-tax net income was $13.3 million, or $0.24 per diluted share, compared to a net loss of $21.3 million, or $0.34 per share for the same period in 2008. These GAAP earnings were affected by a pre-tax unrealized gain of $29.3 million on the Companys shares of NYSE Euronext, Inc. common stock (the NYX shares) and income on early extinguishment of debt of $1.0 million in the second quarter of 2009 and an unrealized loss on our NYX shares of $33.2 million and expense on early extinguishment of debt of $5.1 million in the second quarter of 2008. Excluding these items in each quarter, our pro-forma net loss for the second quarter of 2009 was $4.9 million, or $0.09 per share, compared to pro-forma net income for the second quarter of 2008 of $1.7 million, or $0.03 per share.Overall, our operating companies showed a combined pro forma pre-tax loss of $2.0 million in the second quarter of 2009. These losses, when combined with the expenses at our holding company (the biggest of which is the $5.4 million interest on our public debt for the quarter), resulted in the pro-forma operating loss for the second quarter of 2009.
We repurchased $10.0 million of our public debt in the second quarter of 2009, which further reduced our annual interest payments related to this debt to $20.8 million from approximately $21.9 million as of December 31, 2008. Historically, the operating expense related to our outstanding debt has been the negative carry on our debt, which is the interest we pay on our outstanding indebtedness, less the interest income we receive as a result of having that cash on-hand. Our negative carry following our repurchase of debt in the second quarter of 2009 was reduced to approximately $5.4 million per quarter, based on current short-term interest rates.
Due to the value we continue to see in our common stock, in July 2009 our board of directors increased the $40.0 million share repurchase program we previously announced by $25.0 million, making the total authorization under the share repurchase program $65.0 million. Following this increase and repurchases made to date under the repurchase plan, there are approximately $29.5 million in shares of common stock remaining that may be repurchased under the repurchase plan. The repurchase program may be implemented from time to time in the open market, in privately negotiated transactions or otherwise, in compliance with applicable state and federal securities laws. The timing and amounts of any purchases will be based on market conditions and other factors, including price, regulatory requirements, debt covenant compliance and capital availability. We may suspend, modify or discontinue the share repurchase program at any time.
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