Merriman Curhan Ford Announces Financial Results for the First Quarter Ended March 31, 2010

Company Regains Profitability with Continued Focus on Core Business

News provided by

Merriman Curhan Ford Group, Inc.

May 17, 2010, 04:15 ET

SAN FRANCISCO, May 17 /PRNewswire-FirstCall/ -- Merriman Curhan Ford Group, Inc. (Nasdaq: MERR) today released earnings for the first quarter 2010.

(Logo:  http://photos.prnewswire.com/prnh/20090911/MCFLOGO)

First Quarter Financial Highlights

  • Net income of $340,000, or $0.03 per share of which $0.01 is attributable to common shareholders, compared to a net loss of $1.9 million, or $0.15 per share, in first quarter 2009.
  • Operationally, on a non-GAAP, pro-forma basis(1), the core business generated a profit of $960,000, compared to a loss of $1.4 million in first quarter 2009.
  • Revenue was $16.5 million, representing a growth of 64% over first quarter 2009.
  • Revenue on a non-GAAP, pro-forma basis(1) was $9.8 million, a 97% increase from first quarter 2009:
    • Investment banking revenue was $6.0 million, a 397% increase from first quarter 2009;
    • Commission revenue on a pro-forma basis(1) was $3.3 million, a 9% increase from first quarter 2009; and
    • Principal transaction revenue on a pro-forma basis(1) had a gain of $241,000 comprised primarily of realized gains in the firm's warrant positions and proprietary account, a 42% improvement from first quarter 2009.

"We are pleased to report our most profitable quarter in two years. While this is great improvement, we must continue to intently focus on building our team and client relationships, while rigorously controlling costs," said Jon Merriman, co-founder and chief executive officer of Merriman Curhan Ford Group, Inc. "Our turnaround is attributed to our hardworking team which produces high-quality equity research, executes institutional trades and structures difficult lead-managed banking transactions on behalf of our clients. Our first quarter successes have spurred numerous new dialogues with both current and new customers, contributing to an already robust banking pipeline. Although the economy is showing signs of life after unprecedented declines in 2009, there is still a high level of uncertainty and volatility in the capital markets. We continue to look at opportunities to further grow revenue and control expenses, which will allow us to create a sustainable, profitable long-term business model and increase shareholder value."

Note 1: In 2009, Merriman Curhan Ford introduced non-GAAP, pro-forma operating measures which exclude the effects of its former division, ICD, the unrealized gain or loss on its portfolio of securities and the nonoperating legal and settlement expenses. Management uses these non-GAAP measures, in addition to GAAP results, to assess the performance of the company's core business. A reconciliation of these non-GAAP measures to GAAP is included in the tables below.

Conference Call for the First Quarter 2010 Results

Following this announcement, Merriman's management will host a teleconference call beginning at 2 PM (PT) / 5 PM (ET) today, Monday, May 17, 2010, to discuss the results and related matters.  Interested listeners and participants may access the live teleconference call by dialing (800) 762-8779 or may access the live Web broadcast at www.mcfco.com.

About Merriman Curhan Ford

Merriman Curhan Ford (NASDAQ: MERR) is a financial services firm focused on fast-growing companies and the institutions that invest in them. The company offers high-quality investment banking, equity research, institutional services and corporate & venture services, and specializes in three growth industry sectors: CleanTech, Consumer, Media & Internet and Technology. For more information, please go to www.mcfco.com.

Note to Investors

This press release contains certain forward-looking statements based on our current expectations, forecasts and assumptions that involve risks and uncertainties. This release does not constitute an offer to sell or a solicitation of offers to buy any securities of the Company. Forward-looking statements in this release are based on information available to us as of the date hereof. Our actual results may differ materially from those stated or implied in such forward-looking statements, due to risks and uncertainties associated with our business, which include the risk factors disclosed in our Form 10-K/A filed on April 30, 2010. Forward-looking statements include statements regarding our expectations, beliefs, intentions or strategies regarding the future and can be identified by forward-looking words such as "anticipate," believe," "could," "estimate," "expect," "intend," "may," "should," and "would" or similar words. We assume no obligation to update the information included in this press release, whether as a result of new information, future events or otherwise. The Form 10-K/A filed on April 30, 2010 and the Form 10-Q filed on May 17, 2010, together with this press release and the financial information contained herein, are available on our website, www.mcfco.com. Please click on "Investor Relations."

MERRIMAN CURHAN FORD GROUP, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

Three Months Ended

March 31,

March 31,

2010

2009




Revenue:


Commissions

$ 10,428,255

$  9,117,928

Principal transactions

(206,781)

(842,536)

Investment banking

6,046,673

1,216,417

Advisory and other

239,373

558,813




Total revenue

16,507,520

10,050,622




Operating expenses:


Compensation and benefits

11,915,532

9,265,167

Brokerage and clearing fees

458,216

312,959

Professional services

466,794

767,234

Occupancy and equipment

482,781

576,390

Communications and technology

694,502

721,265

Depreciation and amortization

102,491

147,242

Travel and entertainment

525,932

235,124

Legal services and litigation settlement expense

390,077

345,516

Other

1,103,969

696,623




Total operating expenses

16,140,294

13,067,520




Operating income (loss)

367,226

(3,016,898)








Other income

-

1,200,000

Interest income

3,335

6,487

Interest expense

(14,920)

(15,365)




Income (loss) from continuing operations before income taxes

355,641

(1,825,776)




Income tax expense

(15,294)

(3,216)




Income (loss) from continuing operations

340,347

(1,828,992)




Income (loss) from discontinued operations

-

(94,894)




Net income (loss)

340,347

(1,923,886)

Preferred stock cash dividend

$    (151,800)

$                 -




Net income (loss) attributable to common shareholders

$      188,547

$ (1,923,886)




Basic net income (loss) per share:


Income (loss) from continuing operations

$            0.03

$          (0.15)

Loss from discontinued operations

-

(0.01)




Net income (loss)

$            0.03

$          (0.15)




Net income (loss) attributable to common shareholders

$            0.01

$          (0.15)




Diluted net income (loss) per share:


Income (loss) from continuing operations

$            0.01

$          (0.14)

Income (loss) from discontinued operations

-

(0.01)




Net income (loss)

$            0.01

$          (0.15)




Net income (loss) attributable to common shareholders

$            0.00

$          (0.15)




Weighted average number of common shares:


Basic

12,802,288

12,603,744

Diluted

45,001,720

12,603,744

MERRIMAN CURHAN FORD GROUP, INC.

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

(unaudited)

ASSETS

March 31,


December 31,


2010

2009




Cash and cash equivalents

$    6,404,282

$    5,656,750

Securities owned:


Marketable, at fair value

3,661,796

4,728,940

Not readily marketable, at estimated fair value

892,003

272,463

Other

81,876

67,448

Restricted cash

1,072,086

1,072,086

Due from clearing broker

2,309,648

2,546,581

Accounts receivable, net

492,914

470,992

Prepaid expenses and other assets

1,156,681

801,946

Equipment and fixtures, net

417,428

506,535




Total assets

$  16,488,714

$  16,123,741




LIABILITIES AND STOCKHOLDERS’ EQUITY






Liabilities:


Accounts payable

$       463,758

$       346,220

Commissions and bonus payable

3,896,318

4,133,924

Accrued expenses

2,544,581

2,755,831

Due to clearing and other brokers

8,514

7,185

Securities sold, not yet purchased

453,366

161,461

Deferred revenue

65,000

304,334

Capital lease obligation

330,081

397,958




Total liabilities

7,761,618

8,106,913








Stockholders’ equity:


Convertible Preferred stock, Series A–$0.0001 par value; 2,000,000 shares




authorized; 2,000,000 shares issued and 0 shares outstanding as of




March 31, 2010 and December 31 2009; aggregate liquidation




preference of $0

-

-

Convertible Preferred stock, Series B–$0.0001 par value; 12,500,000 shares




authorized; 8,750,000 shares issued and 0 shares outstanding as of




March 31, 2010 and December 31, 2009; aggregate liquidation




preference of $0

-

-

Convertible Preferred stock, Series C–$0.0001 par value; 14,200,000 shares




authorized; 11,800,000 shares issued and 0 shares outstanding as of




March 31, 2010 and December 31, 2009; aggregate liquidation




preference of $0

-

-

Convertible Preferred stock, Series D–$0.0001 par value; 24,000,000


       shares authorized, 23,720,916 shares issued and 23,162,778 shares


outstanding as of March 31, 2010;  23,720,916 shares issued and


23,720,916 sharesand outstanding as of December 31, 2009;




aggregate liquidation preference of $9,959,995 prior to conversion,


and pari passu with common stock on conversion

2,316

2,372

Common stock, $0.0001 par value; 300,000,000 shares authorized;




13,762,865 and 12,988,073 shares issued and 13,561,288 and 


12,786,496 shares outstanding as of March 31, 2010 and




December 31, 2009, respectively

1,376

1,299

Additional paid-in capital

133,424,093

133,054,192

Treasury stock

(225,613)

(225,613)

Accumulated deficit

(124,475,076)

(124,815,422)




Total stockholders’ equity

8,727,096

8,016,828




Total liabilities and stockholders’ equity

$  16,488,714

$  16,123,741

MERRIMAN CURHAN FORD GROUP, INC.

RECONCILIATION OF NON-GAAP TO GAAP MEASURES – THREE MONTHS

(unaudited)

Three Months Ended March 31,

2010

2009

As Reported

Less ICD

Less Other (1)

Pro-Forma

As Reported

Less ICD

Less Other (1)

Pro-Forma
















Revenue:














Commissions

$ 10,428,255

$ 7,121,602

$                 -

$   3,306,653

$  9,117,928

$  6,073,877

$                 -

$   3,044,051

Principal transactions

(206,781)

-

(447,798)

241,017

(842,536)

-

(1,011,777)

169,241

Investment banking

6,046,673

-

-

6,046,673

1,216,417

-

-

1,216,417

Advisory and other fees

239,373

-

-

239,373

558,813

-

-

558,813
















Total revenue

16,507,520

7,121,602

(447,798)

9,833,716

10,050,622

6,073,877

(1,011,777)

4,988,522
















Operating expenses:














Compensation and
















benefits

11,915,532

6,359,281

-

5,556,251

9,265,167

5,615,703

-

3,649,464

Brokerage and  














clearing fees

458,216

21,126

-

437,090

312,959

14,930

-

298,029

Professional services

466,794

204,246

-

262,548

767,234

2,050

-

765,184

Occupancy and
















equipment

482,781

8,177

-

474,604

576,390

17,509

-

558,881

Communications
















and technology

694,502

152,429

-

542,073

721,265

43,507

-

677,758

Depreciation and
















amortization

102,491

-

-

102,491

147,242

-

-

147,242

Travel and
















entertainment

525,932

227,423

-

298,509

235,124

155,994

-

79,130

Legal and litigation
















settlement expense

390,077

68,966

179,544

141,567

345,516

16,544

776,385

(447,413)

Other expenses

1,103,969

45,467

-

1,058,502

696,623

60,126

-

636,497
















Total operating
















expenses

16,140,294

7,087,115

179,544

8,873,635

13,067,520

5,926,363

776,385

6,364,772
















Operating income/(loss)

$      367,226

$      34,487

$    (627,342)

$      960,081

$ (3,016,898)

$     147,514

$ (1,788,162)

$ (1,376,250)

Note – The column headed "Less Other" includes unrealized gains/losses in "Principal transactions" revenues, and litigation settlement and approximate legal expenses paid as related to the Del Biaggio/Cacchione matters.

SOURCE Merriman Curhan Ford Group, Inc.

WANT YOUR COMPANY'S NEWS FEATURED ON PRNEWSWIRE.COM?

icon3
440k+
Newsrooms &
Influencers
icon1
9k+
Digital Media
Outlets
icon2
270k+
Journalists
Opted In
GET STARTED