Piper Sandler(PIPR) - 2024 Q3 - Quarterly Results

Financial Performance - Net revenues for Q3 2024 were $360 million, a 24% increase compared to Q3 2023[1] - Net income attributable to Piper Sandler Companies was $35 million, a significant increase of 797% compared to Q3 2023[1] - Earnings per diluted common share for Q3 2024 were $1.96, reflecting a 791% increase year-over-year[1] - For Q3 2024, net revenues were $359.6 million, a 6% increase from Q2 2024 and a 24% increase from Q3 2023[9] - Pre-tax income for Q3 2024 was $55.6 million, compared to $28.2 million in Q2 2024 and a loss of $3.5 million in Q3 2023[13] - Net income for Q3 2024 was $34.8 million, or $1.96 per diluted share, flat compared to Q2 2024 but an increase from Q3 2023[15] - Total revenues for the three months ended September 30, 2024, were $360.9 million, an increase of 5.5% compared to $340.8 million for the same period in 2023[29] - Adjusted net income for Q3 2024 was $46.3 million, or $2.57 per diluted common share, reflecting a 2% increase from Q2 2024 and a 47% increase from Q3 2023[22] - Adjusted net income for the nine months ended September 30, 2024, was $141,467,000, up from $94,019,000 for the same period in 2023, indicating a year-over-year growth of approximately 50.3%[35] Revenue Breakdown - Advisory services revenues reached $188 million, up 22% year-over-year, with six out of seven groups showing growth[2] - Investment banking revenues totaled $241.5 million, down 7% from Q2 2024 but up 14% from Q3 2023[9] - Municipal financing revenues were $36 million, marking a 78% increase from the prior year, the best quarter since 2021[2] - Fixed income services revenues increased by 20% year-over-year to $48 million, driven by heightened activity among bank clients[2] - Corporate financing revenues were $17.9 million, a decrease of 65% from Q2 2024 and 52% from Q3 2023 due to fewer completed deals[9] - Institutional brokerage revenues increased to $100.9 million for the three months ended September 30, 2024, compared to $91.7 million in the previous quarter, reflecting a growth of 14.8%[29] Expenses and Margins - Non-interest expenses for Q3 2024 were $304.0 million, a decrease of 2% from Q2 2024 and an increase of 4% from Q3 2023[12] - The compensation ratio for Q3 2024 was 64.2%, decreasing from both Q2 2024 and Q3 2023 due to increased net revenues[12] - Adjusted operating expenses for Q3 2024 were $287.1 million, a 3% decrease from Q2 2024 but an 11% increase from Q3 2023[19] - Adjusted operating income for Q3 2024 was $64.8 million, a 5% increase from Q2 2024 and a 39% increase from Q3 2023, with an adjusted operating margin of 18.4%[20] - The adjusted compensation ratio for Q3 2024 was 62.5%, down from 62.9% in Q2 2024 and 63.9% in Q3 2023[19] Shareholder Returns - A quarterly cash dividend of $0.65 per share was declared, to be paid on December 13, 2024[5] - Year-to-date, the company returned $121 million to shareholders through share repurchases and dividends[5] - The company declared a dividend of $0.65 per common share for the three months ended September 30, 2024, up from $0.60 in the previous quarter[29] - Approximately 9,000 shares were repurchased in Q3 2024 for $2.4 million, with a total of 325,000 shares repurchased for $60.0 million in the first nine months of 2024[24] Tax and Effective Rates - The effective tax rate for Q3 2024 was 27.4%, down from 47.0% in Q2 2024[14] - The adjusted effective tax rate for Q3 2024 was 28.6%, up from 26.6% in Q2 2024 but down from 30.2% in Q3 2023[21] - The income tax expense on a U.S. GAAP basis for the three months ended September 30, 2024, was $15,225,000, compared to $10,227,000 for the same period in 2023, reflecting a 48.9% increase[35] - Adjusted income tax expense for the three months ended September 30, 2024, was $18,519,000, compared to $13,622,000 for the same period in 2023, reflecting a 36.0% increase[35] Acquisitions and Workforce - The company completed the acquisition of Aviditi Advisors on August 23, 2024, adding 41 professionals to its private capital advisory group[3] - The company employed 1,813 full-time employees as of June 30, 2024, an increase from 1,768 employees as of September 30, 2023[26]