B. Riley Financial Reports Preliminary Third Quarter 2016 Adjusted EBITDA

Preliminary Adjusted EBITDA to Range Between $20 Million and $21 Million, Exceeding Prior Company Guidance

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Oct 26, 2016, 09:21 ET

LOS ANGELES, Oct. 26, 2016 /PRNewswire/ -- B. Riley Financial, Inc. (NASDAQ: RILY), a diversified provider of financial and business advisory services, has reported certain preliminary results for its third quarter ended September 30, 2016.

Based on preliminary unaudited information, B. Riley Financial expects to report adjusted EBITDA for the third quarter of 2016 in the range of $20 million to $21 million. This would exceed the company's guidance of $15 million to $20 million issued on August 5, 2016, and represents a significant increase from $3.1 million reported in the same year-ago period.

"Our preliminary third quarter results reflect strong performance in our liquidation segment, along with consistent performance in our appraisal business, as well as an improvement in our brokerage business," said company chairman and CEO, Bryant Riley. "United Online, which we acquired in early July, performed in line with our expectations, generating a steady stream of cash flow."

"We continue to seek other strategic investment opportunities similar to United Online, in addition to seeking investment opportunities in our Auction and Liquidation segment," added Riley. "We believe our balance sheet provides us with significant flexibility to pursue attractive opportunities that can expand and diversify our business."

B. Riley Financial plans to report complete Q3 2016 financial results the second week of November 2016. The conference call details will be announced at least a week prior to the call.

About B. Riley Financial, Inc.
B. Riley Financial, Inc. provides collaborative financial services and solutions through several subsidiaries, including: B. Riley & Co. LLC, a leading investment bank which provides corporate finance, research, and sales & trading to corporate, institutional and high net worth individual clients; Great American Group, LLC, a leading provider of advisory and valuation services, and asset disposition and auction solutions; B. Riley Capital Management, LLC, an SEC registered Investment Advisor, which includes B. Riley Asset Management, a provider of investment products to institutional and high net worth investors, and B. Riley Wealth Management (formerly MK Capital Advisors), a multi-family office practice and wealth management firm focused on the needs of ultra-high net worth individuals and families; and Great American Capital Partners, a provider of senior secured loans and second lien secured loan facilities to middle market public and private U.S. companies.

B. Riley Financial is headquartered in Los Angeles with offices in major financial markets throughout the United States and Europe. For more information on B. Riley Financial, visit www.brileyfin.com.

Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements include, without limitation, statements regarding our expectations, hopes or intentions regarding the future. These forward looking statements can often be identified by their use of words such as "will", "predict", "continue", "forecast", "expect", "believe", "anticipate", "outlook", "could", "target", "project", "intend", "plan", "seek", "estimate", "should", "may" and "assume", as well as variations of such words and similar expressions referring to the future, and may include (without limitation) express or implied statements regarding future financial performance, the effects of our business model, the effects of the United Online acquisition and expectations regarding related cash flow, expectations regarding future transactions and the financial impact, size and consistency of returns and timing thereof, expectations regarding adjusted EBITDA for the third quarter of 2016, as well as statements regarding the potential for strategic investment opportunities in our business segments. Forward-looking statements involve certain risks and uncertainties, and actual results may differ materially from those discussed in each such statement. Factors that could cause actual results to differ include (without limitation) risks associated with large engagements in our Auction and Liquidation segment; our ability to achieve expected benefits with respect to United Online, within expected time frames or at all; our ability to consummate anticipated transactions and the expected financial impact thereof, in each case within the expected timeframes or at all; our ability to successfully integrate recent acquisitions; loss of key personnel; our ability to manage growth; the potential loss of financial institution clients; and the timing of completion of significant engagements. Additional factors are discussed under the heading "Risk Factors" in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2015, and in the Company's other current and periodic reports filed from time to time with the Securities and Exchange Commission. All forward-looking statements in this document are made based on information available to the Company as of the date hereof, and the Company assumes no obligation to update any forward-looking statement.

Note Regarding Use of Non-GAAP Financial Measures
Certain of the information set forth herein, including adjusted EBITDA, may be considered non-GAAP financial measures. B. Riley Financial believes this information is useful to investors because it provides a basis for measuring the company's available capital resources, the operating performance of its business and its cash flow, excluding net interest expense, provisions for income taxes, depreciation, amortization, transaction expenses, restructuring costs, insurance dispute recoveries and stock-based compensation that would normally be included in the most directly comparable measures calculated and presented in accordance with Generally Accepted Accounting Principles ("GAAP"). In addition, the company's management uses these non-GAAP financial measures along with the most directly comparable GAAP financial measures in evaluating the company's operating performance, capital resources and cash flow. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information presented in compliance with GAAP, and non-financial measures as reported by the company may not be comparable to similarly titled amounts reported by other companies. The non-GAAP measures are described above and are reconciled to the corresponding GAAP measure in the unaudited condensed consolidated financial statements portion of this release under the headings "Q3 2016 Guidance Adjusted EBITDA Reconciliation."

Investor Contact
Scott Liolios or Matt Glover
Liolios Group, Inc.
949-574-3860
[email protected]

B. RILEY FINANCIAL, INC. AND SUBSIDIARIES
Q3 2016 GUIDANCE - ADJUSTED EBITDA RECONCILIATION
(Unaudited)
(dollars in thousands)


		Q3 2016 Guidance
For the three months ending Sep 30, 2016		Low	High

Net Income (guidance)		$ 8,500	$ 9,000

Adjustments (estimate):
	Provision for income taxes	5,800	6,100
	Interest expense ⁽¹⁾	991	991
	Interest income	(26)	(26)
	Depreciation and amortization	1,950	2,000
	Share based payments	800	850
	Transaction and restructuring costs	3,609	3,709
	Insurance dispute recovery	(1,624)	(1,624)

	Total EBITDA Adjustments	11,500	12,000

Adjusted EBITDA Guidance		$ 20,000	$ 21,000