Pursuant to Section 13 or 15 (d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) December 18, 2002
THE BEAR STEARNS COMPANIES INC.
| DELAWARE (State or Other Jurisdiction of Incorporation) |
File No. 1-8989 (Commission File Number) |
13-3286161 (IRS Employer Identification Number) |
383 Madison Avenue, New York, New York 10179
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (212) 272-2000
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Item 5. Other Events
Filed herewith is a copy of The Bear Stearns Companies Inc. (the “Company”) Press Release, dated December 18, 2002, announcing earnings for the Company for the fiscal year ended November 30, 2002 and three months ended November 30, 2002, which includes the Unaudited Consolidated Statements of Income of the Company for the three and twelve months ended November 30, 2002 and November 30, 2001, and the three months ended August 31, 2002. All normal recurring adjustments that are, in the opinion of management, necessary for a fair presentation of the results of operations for the periods presented have been included. The nature of the Company’s business is such that the results for any interim period are not necessarily indicative of the results for a full year.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
(a) Financial Statements of business acquired:
Not applicable.
(b) Pro Forma financial information:
Not applicable.
(c) Exhibit:
(99) Press Release, dated December 18, 2002.
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Signature
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 thereunto duly authorized.
THE BEAR STEARNS COMPANIES INC.
| By: | /s/ Marshall J Levinson
Marshall J Levinson Controller (Principal Accounting Officer) |
Dated: December 19, 2002
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THE BEAR STEARNS COMPANIES INC.
FORM 8-K
CURRENT REPORT
EXHIBIT INDEX
Exhibit No.
Description
(99)
Press Release, dated December 18, 2002
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Contact: Elizabeth Ventura (212) 272-9251
Kerri Kelly (212) 272-2529
NEW YORK – December 18, 2002 – The Bear Stearns Companies Inc. (NYSE:BSC) today reported earnings per share (diluted) of $1.36 for the fourth quarter ended November 30, 2002, up 25.9% from $1.08 per share for the fourth quarter of 2001. Net income for the fourth quarter of 2002 was $190.5 million, up 23.0% from $154.9 million for the fourth quarter of 2001. Net revenues for the 2002 fourth quarter were $1.13 billion, up 0.6% from $1.12 billion for the 2001 fourth quarter. The annualized after-tax return on common stockholders’ equity for the fourth quarter of 2002 was 14.5%.
For the fiscal year ended November 30, 2002, earnings per share (diluted) were $6.47, up 51.5% from $4.27 in the prior year. Net income for the full year was $878.3 million, up 42.0% versus $618.7 million in the twelve-month period ended November 30, 2001. Net revenues for fiscal year 2002 were $5.1 billion, an increase of 4.5% from $4.9 billion in the prior fiscal year. After-tax return on common stockholders' equity was 18.1% for fiscal year 2002.
The fourth quarter of 2002 included a mark down of $33.9 million related to the Company's merchant banking investment in Aeropostale. This adjustment reflects a decrease in the market value of Aeropostale's shares since its initial public offering in May of 2002. The mark down in the carrying value of the shares reduced the gain recorded in 2002 to $226.9 million.
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Excluding the impact of this merchant banking investment, earnings per share (diluted) were $1.50 for the fourth quarter of 2002, up 38.9% from the fourth quarter of 2001. Net income for the fourth quarter 2002 was $211.0 million, up 36.2%, and net revenues in the last fiscal quarter of 2002 were $1.16 billion, up 3.7% compared with the November quarter of 2001. On an operating basis the annualized after-tax return on common stockholders' equity for the quarter was 16.4%.
For the fiscal year 2002, excluding the aforementioned merchant banking gain, earnings per share (diluted) were $5.57, up 30.4% from fiscal 2001; net income was $759.2 million, up 22.7% and net revenues were $4.9 billion, essentially unchanged compared with fiscal 2001. On an operating basis, the after-tax return on stockholders' equity for the year ended November 30, 2002 was 15.8%.
"We look back on fiscal year 2002 as one marked by economic uncertainty and challenging market conditions. Despite this difficult environment, Bear Stearns reported record profits. To have performed at this level is an accomplishment that makes us all extremely proud," said Bear Stearns chairman and chief executive officer James E. Cayne. "Looking ahead, we believe we are well prepared to confront these challenging market conditions. In an industry plagued by over capacity, we believe our aggressive expense management has served to bring operating costs in line with our current business volume," said Mr. Cayne.
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A brief discussion of the firm's business segments follows:
Net revenues in Capital Markets, which includes Institutional Equities, Fixed Income and Investment Banking, were $3.9 billion for the fiscal year ended November 30, 2002, an increase of 13.0% versus the prior fiscal year of $3.5 billion. Excluding the merchant banking gain, net revenues in Capital Markets for fiscal year 2002 were up 6.5%, to $3.7 billion.
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Capital Markets net revenues for the fourth quarter were $839.6 million, up 6.2% from $790.8 million for the fourth quarter ended November 30, 2001. Excluding the mark down of the merchant banking investment in Aeropostale, Capital Markets net revenues for the fourth quarter were up 10.5%, to $873.5 million.
Net revenues in Global Clearing Services were $778.1 million, down 4.0% from $810.6 million in the year 2001. Average customer margin debt balances for the year were $34.1 billion, versus $39.3 billion for the year ended November 30, 2001.
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Fourth quarter net revenues were $180.3 million, down 3.7% from $187.3 million in the fourth quarter of 2001 principally due to a decrease in commission revenues. Average customer margin debt balances for the quarter ended November 30, 2002 were $31.7 billion, down from $32.5 billion in the prior year quarter.
Net revenues in Wealth Management, which includes Private Client Services and Asset Management, were $498.4 million for the year, down 8.3% versus $543.5 million in fiscal 2001.
Wealth Management net revenues for the quarter were $124.5 million, down 9.1% from $137.0 million in the fourth quarter of 2001.
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As of November 30, 2002 total capital, including stockholders' equity and long-term borrowings, was approximately $30.6 billion. Book value as of November 30, 2002 was $39.94 per share, based on 145.6 million shares outstanding. The Company repurchased approximately 10.5 million shares of its common stock during the fiscal year pursuant to its share repurchase plan.
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The Board of Directors of The Bear Stearns Companies Inc. declared a quarterly cash dividend of 68.75 cents per share on the outstanding shares of Adjustable Rate Cumulative Preferred Stock, Series A, payable January 15, 2003 to stockholders of record on December 31, 2002. In addition, other regular dividends declared by the Board of Directors include: (i) a cash dividend of $3.075 per share on the outstanding shares of 6.15% Cumulative Preferred Stock, Series E (which is equivalent to 76.875 cents per related depositary share); (ii) a cash dividend of $2.86 per share on the outstanding shares of 5.72% Cumulative Preferred Stock, Series F (which is equivalent to 71.50 cents per related depositary share); and (iii) a cash dividend of $2.745 per share on the outstanding shares of 5.49% Cumulative Preferred Stock, Series G (which is equivalent to 68.625 cents per related depositary share) all payable January 15, 2003 to stockholders of record on December 31, 2002.
Founded in 1923, The Bear Stearns Companies Inc. (NYSE: BSC) is the parent company of Bear, Stearns & Co. Inc., a leading investment banking and securities trading and brokerage firm. With approximately $30.6 billion in total capital, Bear Stearns serves governments, corporations, institutions and individuals worldwide. The company's business includes corporate finance and mergers and acquisitions, institutional equities and fixed income sales, trading and research, private client services, derivatives, foreign exchange and futures sales and trading, asset management and custody services. Through Bear, Stearns Securities Corp., it offers financing, securities lending, clearing and technology solutions to hedge funds, broker-dealers and investment advisors. Headquartered in New York City, the company has approximately 10,500 employees worldwide. For additional information about Bear Stearns, please visit the firm's Web site at http://www.bearstearns.com.
* A cash dividend on the common stock has not yet been declared. The next meeting of The Bear Stearns Companies Inc.’s Board of Directors is scheduled for January 8, 2003.
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***
Financial Tables Attached
Certain statements contained in this discussion are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ materially from those discussed in the forward-looking statements. For a discussion of the risks and uncertainties that may affect the company’s future results, please see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Management” in the Company’s 2001 Annual Report to Stockholders and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Quantitative and Qualitative Disclosures about Market Risk” in the company’s Quarterly Reports on Form 10-Q, which have been filed with the Securities and Exchange Commission.
A conference call to discuss the company’s results will be held on Wednesday, December 18, at 10:00 a.m., E.S.T. The call will be open to the public. Those wishing to listen to the conference call should dial 1-800-692-4690 (or 1-703-326-5190 for international callers) at least 15 minutes prior to the commencement of the call to ensure connection. The conference call will also be accessible through our Web site at http://www.bearstearns.com. For those unable to listen to the live broadcast of the call, a replay will be available on our Web site or by dialing 1-888-266-2081 (or 1-703-925-2533 for international callers) at approximately 1:00 p.m. E.S.T. The pass code for the replay is 6349636. The replay will be available until 11:59 p.m. on Friday, December 27. If you have any questions on how to obtain access to the conference call, please contact Kerri Kelly at 1-212-272-2529 or via email at kkelly@bear.com.
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