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B. Riley Financial Reports Second Quarter 2022 Results; Declares $1.00 Dividend

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Q2 GAAP Revenues of $42.7 million; Operating Revenues of $266.6 million

Q2 GAAP Net Loss of ($142.2 million), Operating Adjusted EBITDA of $74.2 million

Declares Quarterly Dividend of $1.00 per common share

LOS ANGELES, July 28, 2022 /PRNewswire/ -- B. Riley Financial, Inc. (NASDAQ: RILY) ("B. Riley" or the "Company"), a diversified financial services platform, today announced results for the three-month period ended June 30, 2022.

B. Riley Financial logo (PRNewsFoto/B. Riley Financial, Inc.)
B. Riley Financial logo (PRNewsFoto/B. Riley Financial, Inc.)

Bryant Riley, Chairman and Co-Chief Executive Officer of B. Riley Financial, commented: "Our second quarter results demonstrated the relative strength and ability of our non-cyclical businesses to steadily perform amid disruptive markets. Periods of volatility have historically presented our most attractive opportunities to differentiate ourselves with clients, attract top talent, and generate sustainable share gains across key business lines. We believe the current environment is no exception."

"Despite the markdown on our investments and declines in our underwriting business, our dynamic platform has demonstrated continued resiliency. We have earned over $17.00 per share for our shareholders since 2019, and despite a GAAP net loss of ($43.4 million) over the trailing twelve-month period, we delivered operating EBITDA of $366 million in the same period, representing a meaningful increase compared to $114 million in 2019. Increasing contributions from less cyclical and less episodic businesses have exceeded the capital needed to support our dividend while providing us flexibility to continue to invest across our business."

"At the same time, strategic investments remain an integral part of our business, as a strategy that helps competitively advantage our clients. Our cash and investment portfolio has been diversified to balance our allocation between debt and equity-related investments. In our credit positions, we have demonstrated an ability to structure lending opportunities that enable us to earn attractive spreads with minimal impairments over time. The remainder of our portfolio is focused on public and private small-cap companies where we have high conviction in capital appreciation over our investment horizon. Securities in our investment portfolio have exceeded the Russell 2000 Index in multiple market cycles, having generated total returns of more than 90% to B. Riley since 2019. As we look ahead, we remain optimistic about the total return potential of our investment portfolio, as well as our ability to capitalize on opportunities being presented by the current market dislocation."

Tom Kelleher, Co-Chief Executive Officer of B. Riley Financial, added: "During the quarter, the balance of our operating businesses continued to deliver steady cash flow to our platform while performing to support our clients. Amid another transformative period for B. Riley, we have made meaningful progress in expanding our existing businesses while consolidating recent acquisitions. Our communications business with Lingo serves as a leading source of recurring cash flow for our platform as financial consulting performs steadily quarter-to-quarter and year-to-year. With core capabilities in restructuring, asset disposition, and distressed financing, we believe our diversified platform stands to benefit during periods of market austerity. As we begin to realize synergies from combining National Holdings and FocalPoint into our respective legacy wealth and investment banking businesses, we are looking to the horizon and evaluating other accretive acquisitions to accelerate our growth."

Declaration of Common Dividend

B. Riley has declared a regular quarterly cash dividend of $1.00 per common share which is payable on or about August 23 to common stockholders of record as of August 11.

Financial Summary















































Three Months Ended


Six Months Ended






June 30,

June 30,

























(Dollars in thousands, except for share data)



2022




2021




2022




2021



























Net (loss) income available to common shareholders


$

(142,161)



$

73,887



$

(154,225)



$

326,794



























Basic (loss) income per common share 


$

(5.07)



$

2.70



$

(5.52)



$

12.03






Diluted (loss) income per common share 


$

(5.07)



$

2.58



$

(5.52)



$

11.39














































 

Net loss available to common shareholders of ($142.2 million), or ($5.07) diluted earnings per share (EPS), was driven by investment loss (4) of ($223.9 million) related to the decline in capital markets which impacted the value of the Company's investment portfolio. Net loss was ($154.2 million) year-to-date, or diluted EPS of ($5.52).















































Three Months Ended


Six Months Ended





June 30,

June 30,

























(Dollars in thousands)



2022




2021




2022




2021



























    Operating Revenues (2)


$

266,627



$

304,091



$

540,606



$

637,308






    Investment (Loss) Gains (4)



(223,927)




32,679




(292,317)




299,621






        Total Revenues


$

42,700



$

336,770



$

248,289



$

936,929



























   Operating Adjusted EBITDA (3)


$

74,220



$

92,124



$

158,407



$

214,841






   Investment Adjusted EBITDA (5)



(209,997)




32,763




(253,522)




295,527






       Total Adjusted EBITDA (1)


$

(135,777)



$

124,887



$

(95,115)



$

510,368






























-




-




-




-




 

  • Total revenues were $42.7 million for the quarter and $248.3 million year-to-date.

  • Operating revenues (2) were $266.6 million for the quarter and $540.6 million year-to-date.

  • Operating adjusted EBITDA (3) of $74.2 million for the quarter and $158.4 million year-to-date.

  • Total adjusted EBITDA (1) loss of ($135.8 million) for the quarter and ($95.1 million) year-to-date.

As of June 30, 2022, cash and investments (6) totaled approximately $2.2 billion including cash and cash equivalents of $216.1 million. Total cash and investments, (6) net of debt, was $61.5 million.

Segment Financial Summary
















































    Operating Revenues (2)


    Investment Gains (Loss) (4)


Total Segment Revenue






Three Months Ended June 30,


Three Months Ended June 30,


Three Months Ended June 30,





(Dollars in thousands)

2022


2021


2022


2021


2022


2021





Capital Markets


$      129,825



$       151,488



$    (225,455)



$         29,897



$      (95,630)



$       181,385





Wealth Management


60,861



87,444



1,528



2,865



62,389



90,309





Auction and Liquidation


3,924



17,277



-



-



3,924



17,277





Financial Consulting


24,310



23,735



-



-



24,310



23,735





Principal Investments - Communications and Other


42,533



19,646



-



-



42,533



19,646





Brands


5,174



4,501



-



(83)



5,174



4,418




























Segment Operating Income (Loss) (7)


    Investment Income (Loss) (5)


Total Segment Income (Loss)






Three Months Ended June 30,


Three Months Ended June 30,


Three Months Ended June 30,





(Dollars in thousands)

2022


2021


2022


2021


2022


2021





Capital Markets


$        53,282



$         74,701



$    (211,525)



$         29,981



$    (158,243)



$       104,682





Wealth Management


(8,841)



(3,598)



1,528



2,865



(7,313)



(733)





Auction and Liquidation


451



3,555



-



-



451



3,555





Financial Consulting


4,284



4,175



-



-



4,284



4,175





Principal Investments - Communications and Other


7,647



7,275



-



-



7,647



7,275





Brands


3,773



3,096



-



(83)



3,773



3,013