Siebert Reports Third Quarter 2024 Financial Results

Rhea-AI Summary

Siebert Financial Corp. (NASDAQ: SIEB) reported strong Q3 2024 financial results with revenue increasing 25% to $22.6 million and operating income rising 13% to $4.8 million compared to Q3 2023. The company saw significant growth in stock borrow/stock loan revenue, up 44% to $5.8 million, while retail customer net worth increased 10% to $17.5 billion. Notable developments include the acquisition of Gebbia Entertainment and securing a $20 million revolving credit facility with East West Bank, supporting strategic growth initiatives and expansion efforts.

Positive

• Revenue increased 25% YoY to $22.6 million in Q3 2024
• Operating income grew 13% YoY to $4.8 million
• Net income available to common stockholders increased 39%
• Stock borrow/stock loan revenue up 44% to $5.8 million
• Retail customer net worth grew 10% to $17.5 billion
• Secured $20 million revolving credit facility

Negative

• None.

Insights

Financial Analyst

Siebert's Q3 2024 results demonstrate robust financial performance with significant growth across key metrics. Revenue surged 25% to $22.6 million, driven by strong interest income and stock borrow/loan activities. The 39% increase in net income to $3.8 million reflects improved operational efficiency.

The new $20 million credit facility from East West Bank provides strategic flexibility for growth initiatives. The 10% increase in retail customer net worth to $17.5 billion indicates strong client retention and asset growth. However, the acquisition of Gebbia Entertainment represents an unexpected diversification into entertainment, which could introduce new risks and uncertainties to the traditional financial services model.

Market Research Analyst

The strategic shift into entertainment through Gebbia Entertainment acquisition signals a bold diversification move that could reshape Siebert's market positioning. While the core financial metrics are strong, the entertainment industry expansion introduces both opportunities and risks. The improved website and branding initiatives, coupled with substantial capital access, position Siebert for potential market share growth in their traditional financial services while exploring new revenue streams.

The 44% growth in stock borrow/loan revenue to $5.8 million indicates strong execution in high-margin business segments, suggesting effective capital allocation strategies.

Q3 2024 Operating Income Increased 13% to $4.8 Million; Net Income Available to Common Stockholders Increased 39% to $3.8 Million

MIAMI--(BUSINESS WIRE)-- Siebert Financial Corp. (NASDAQ: SIEB) (“Siebert”), a diversified provider of financial services, today reported financial results for the third quarter ended September 30, 2024.

Third Quarter 2024 Financial and Operational Highlights

• Revenue increased 25% to $22.6 million, compared to $18.0 million in the third quarter of 2023
• Operating income increased 13% to $4.8 million, compared to $4.3 million in the third quarter of 2023
• Stock borrow / stock loan increased by 44% to $5.8 million, compared to $4.0 million in third quarter of 2023
• Retail customer net worth increased 10% to $17.5 billion, compared to $15.9 billion at the end of 2023

Recent Business Highlights

• Acquired Gebbia Entertainment, a music and entertainment company, marking strategic entry into the media and entertainment industries. The acquisition paves the way for new content production opportunities and strengthens Siebert’s marketing and branding potential.
• In August 2024, entered into a credit agreement with East West Bank, securing a revolving credit facility of up to $20 million. The facility supports Siebert’s strategic goals, enabling funding for acquisitions, stock buybacks, and general corporate purposes up to $10 million. This enhanced capital access bolsters Siebert’s ongoing growth and expansion efforts.

Management Commentary

“We continued to see strong financial results in the third quarter highlighting the growth and promising future of Siebert,” said Chairman and CEO John J. Gebbia. “We remain focused on strategic growth by continuously expanding our opportunities and reach. The acquisition of Gebbia Entertainment brings exciting new marketing and branding potential for Siebert. Additionally, the recent rebranding of our website for retail and corporate service clients reflects our commitment to delivering top-tier offerings and values. We are well-positioned to achieve our strategic objectives and capitalize on emerging opportunities as well continue to build upon Muriel Siebert’s legacy.”

Andrew Reich, CFO of Siebert, added: "We delivered another strong quarter, with revenue up 25% year-over-year to $22.6 million, driven primarily by interest income and stock borrow / stock loan revenue. Operating income rose by 13% while net income available to common stockholders surged by 39%. With our total equity up 18% since last fiscal-end, and a solid capital position, we are well-positioned to seize the growth opportunities ahead. We anticipate these positive trends will continue, setting the stage for sustained success."

Notice to Investors

This communication is provided for informational purposes only and is neither an offer to sell nor a solicitation of an offer to buy any securities in the United States or elsewhere.

About Siebert Financial Corp.

Siebert is a diversified financial services company and has been a member of the NYSE since 1967 when Muriel Siebert became the first woman to own a seat on the NYSE and the first to head one of its member firms.

Siebert operates through its subsidiaries Muriel Siebert & Co., LLC, Siebert AdvisorNXT, LLC, Park Wilshire Companies, Inc., RISE Financial Services, LLC, Siebert Technologies, LLC and StockCross Digital Solutions, Ltd. Through these entities, Siebert provides a full range of brokerage and financial advisory services including securities brokerage, investment advisory and insurance offerings, securities lending, and corporate stock plan administration solutions. For over 55 years, Siebert has been a company that values its clients, shareholders, and employees. More information is available at www.siebert.com.

Cautionary Note Regarding Forward-Looking Statements

The statements contained in this press release, that are not historical facts, including statements about our beliefs and expectations, are “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements preceded by, followed by or that include the words “may,” “could,” “would,” “should,” “believe,” “expect,” “anticipate,” “plan,” “estimate,” “target,” “project,” “intend” and similar words or expressions. In addition, any statements that refer to expectations, projections, or other characterizations of future events or circumstances are forward-looking statements.

These forward-looking statements, which reflect beliefs, objectives, and expectations as of the date hereof, are based on the best judgment of management of Siebert. All forward-looking statements speak only as of the date on which they are made. Such forward-looking statements are subject to certain risks, uncertainties and assumptions relating to factors that could cause actual results to differ materially from those anticipated in such statements, including, without limitation, the following: economic, social and political conditions, global economic downturns resulting from extraordinary events; securities industry risks; interest rate risks; liquidity risks; credit risk with clients and counterparties; risk of liability for errors in clearing functions; systemic risk; systems failures, delays and capacity constraints; network security risks; competition; reliance on external service providers; new laws and regulations affecting Siebert’s business; net capital requirements; extensive regulation, regulatory uncertainties and legal matters; failure to maintain relationships with employees, customers, business partners or governmental entities; the inability to achieve synergies or to implement integration plans; and other consequences associated with risks and uncertainties detailed in Part I, Item 1A - Risk Factors of Siebert’s Annual Report on Form 10-K for the year ended December 31, 2023, and Siebert’s filings with the SEC.

Siebert cautions that the foregoing list of factors is not exclusive, and new factors may emerge, or changes to the foregoing factors may occur, that could impact its business. Siebert undertakes no obligation to publicly update or revise these statements, whether as a result of new information, future events or otherwise, except to the extent required by the federal securities laws.

View source version on businesswire.com: https://www.businesswire.com/news/home/20241112494951/en/

Investor Relations:

Matt Glover

Gateway Group, Inc.

949-574-3860

SIEB@gateway-grp.com

Source: Siebert Financial Corp.

FAQ

What was Siebert's (SIEB) revenue growth in Q3 2024?

Siebert reported a 25% increase in revenue to $22.6 million in Q3 2024 compared to $18.0 million in Q3 2023.

How much did Siebert's (SIEB) operating income increase in Q3 2024?

Siebert's operating income increased 13% to $4.8 million in Q3 2024 compared to $4.3 million in Q3 2023.

What acquisitions did Siebert (SIEB) make in Q3 2024?

Siebert acquired Gebbia Entertainment, a music and entertainment company, marking their strategic entry into the media and entertainment industries.

What new credit facility did Siebert (SIEB) secure in August 2024?

Siebert secured a revolving credit facility of up to $20 million with East West Bank in August 2024.