Charles Schwab 2011 Annual Report Download - page 24

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DECEMBER 31,
TWELVE MONTHS ENDED THREE MONTHS ENDED
JUNE 30, MARCH 31,
(In Millions, Except Per Share Amounts and as Noted) 2010-11 2011 2010 2009
Net revenues 10% $ 4,691 $ 4,248 $ 4,193
Expenses excluding interest (5%) $ 3,299 $ 3,469 $ 2,917
Net income 90% $ 864 $ 454 $ 787
Basic earnings per share 84% $ .70 $ .38 $ .68
Diluted earnings per share 84% $ .70 $ .38 $ .68
Dividends declared per common share – $ .24 $ .24 $ .24
Weighted-average common shares
outstanding — diluted 3% 1,229 1,194 1,160
Closing market price per share (at year-end) (34%) $ 11.26 $ 17.11 $ 18.82
Book value per common share (at year-end) 17% $ 6.07 $ 5.18 $ 4.37
Net revenue growth (decline) 10% 1% (19%)
Pre-tax prot margin 29.7% 18.3% 30.4%
Return on stockholders’ equity 12% 8% 17%
Full-time equivalent employees
(at year-end, in thousands) 10% 14.1 12.8 12.4
Net revenues per average
full-time equivalent employee (in thousands) 4% $ 350 $ 337 $ 338
GROWTH RATE
1-YEAR
RECONCILIATION OF NET REVENUES, EXPENSES EXCLUDING INTEREST, AND NET INCOME
EXCLUDING CERTAIN ITEMS TO REPORTED AMOUNTS
FINANCIAL HIGHLIGHTS
(In Millions, Unaudited) 2011 2010 %Change 2011 2010 %Change
Net Revenues Excluding Certain Items $ 4,623 $ 4,248 9% $ 1,190 $ 978 22%
optionsXpress net revenues(1) 68 – N/M – – –
Reported Net Revenues $ 4,691 $ 4,248 10% $ 1,190 $ 978 22%
Expenses Excluding Interest and Certain Items $ 3,208 $ 2,987 7% $ 797 $ 760 5%
optionsXpress expenses(2)
84 – N/M – – –
Class action litigation and regulatory reserve 7 320 N/M 7 196 N/M
Money market mutual fund charges – 132 N/M – – –
Other expense – 30 N/M – 9 N/M
Total expenses excluded 91 482 N/M 7 205 N/M
Reported Expenses Excluding Interest $ 3,299 $ 3,469 (5%) $ 804 $ 965 (17%)
Income Excluding Certain Items
Before Taxes on Income $ 1,415 $ 1,261 12% $ 393 $ 218 80%
Net Income Excluding Certain Items $ 880 $ 775 14% $ 242 $ 132 83%
Add: Revenues excluded above 68 – N/M – – –
Less: Expenses excluded above 91 482 N/M 7 205 N/M
Tax benet (7) (161) N/M (3) (79) N/M
Reported Net Income $ 864 $ 454 90% $ 238 $ 6 N/M
(1) Includes net revenues of optionsXpress Holdings, Inc. (optionsXpress) from the date of acquisition of September 1, 2011.
(2) Includes non-recurring costs relating to the acquisition and integration of optionsXpress, which totaled $20 million in 2011, as well as operating expenses from September 1, 2011.
N/M — Not Meaningful
22 FINANCIAL HIGHLIGHTS AND RECONCILIATION