Leucadia National Corporation (NYSE:LUK) today announced its
operating results for the three month period ended September 30,
2014. Net income attributable to Leucadia National Corporation
common shareholders was $54.7 million ($.14 per diluted share) for
the three month period and $214.1 million ($.56 per diluted share)
for the nine month period ended September 30, 2014. These results
were reduced by the charge announced yesterday of $70 million ($.18
per diluted share) related to the agreement to settle litigation
concerning the Jefferies acquisition.
Rich Handler, CEO of Leucadia, and Brian Friedman, President of
Leucadia, said the following:
“Leucadia continues to make progress building value across many
of our businesses, and we expanded our portfolio in a meaningful
way, with investments in asset management, gold and silver mining,
and oil and gas exploration and production.”
Jefferies recorded strong results for the third quarter and
first nine-months, driven by $465.2 million in Investment Banking
net revenues and $366.7 million in sales and trading net revenues
for the quarter.
National Beef and the U.S. packing industry continue to be
challenged by insufficient cattle supply. National Beef’s pre-tax
income was $26.3 million for the three month period and $4.8
million for the nine month period ended September 30, 2014. Third
quarter results improved compared to earlier quarters in the year
due to steps taken to mitigate the cattle shortage, such as the May
closure of the Brawley, California facility, and a modestly more
favorable margin environment, reflecting the seasonal benefit of
the summer months.
Origination volume for Berkadia Commercial Mortgage for the
third quarter was the second highest in its history, bringing
year-to-date volume to $7.5 billion. The company’s lending pipeline
remains strong heading into the fourth quarter. Our share of
pre-tax earnings for the first nine months of the year was $58.4
million and we received $52.5 million in cash distributions.
Garcadia continued its strong performance as growth of its same
store new car sales year-over-year reached 16.4% for the first nine
months of 2014, in comparison to the U.S. industry average of 5.4%.
Garcadia today owns 26 dealerships, having purchased an additional
dealership in California near the end of the third quarter and
three additional dealerships during October in Detroit, Michigan.
We have received cash distributions from Garcadia of $37.3 million
during the first nine months of the year.
Linkem has continued to increase its subscriber base as it
awaits the availability of 3.5GHz LTE technology. Linkem’s LTE
trials are underway, and we continue to anticipate new LTE base
station deployments beginning later this year. As of September 30,
2014, Linkem had 216,425 subscribers, an increase of 52,302
subscribers since the start of the year, despite restrained
marketing activities. We continue to be cautiously optimistic about
Linkem’s ability to capture market share.
As expected, Conwed’s acquisitions during 2014 are strengthening
revenues and improving operating income. In March, Conwed acquired
Filtrexx, previously a significant customer. Filtrexx uses Conwed
netting products to provide erosion control solutions with primary
applications in oil and gas development, civil infrastructure, and
commercial and residential construction. In August, Conwed acquired
Weaver, the leading installer of the products manufactured by
Filtrexx. Revenues increased 33.4% for the three months and 14.8%
for the nine months ended September 30, 2014, reflecting a
combination of internal growth within Conwed and the impact of its
recent acquisitions. Pre-tax income increased 30.7% for the three
months, but decreased 13.9% for the nine months ended September 30,
2014, due to higher volumes, a more profitable mix of products and
services, and less of an impact of higher prices for polypropylene
resin, a major raw material input, in the later months of the
year.
Idaho Timber continued the recent positive trend of increasing
revenues and higher margins. Pre-tax earnings climbed from $8.9
million for the first nine months of 2013 to $14.8 million for the
same period this year. The results were driven by continued strong
performance across all of its divisions, with the largest
contribution from the primary sawmill division.
In the third quarter, we achieved a milestone at our Specialty
Finance platform. Foursight Capital executed its first
securitization of $112.7 million. Origination volume continues to
grow, totaling $39.5 million during the quarter. In early October,
we purchased the 10% minority interest to increase our ownership to
100%. Chrome Capital is our used vehicle leasing company, an
investment initiated during the first quarter of 2014. While still
at an early stage, Chrome continues to see significant
quarter-over-quarter increases in revenue. We currently own 52.9%
of Chrome and our stake will increase as we fund future growth.
During the first nine months of the year, we increased our
investments in oil and gas exploration and development. Our
cumulative investment in Juneau Energy, a company that leases and
develops oil and gas properties in Texas and Oklahoma, now totals
$105.8 million. Investments in Vitesse, a company that selectively
acquires and participates in the development of non-operating oil
and gas interests in the heart of the Bakken oil field, has grown
to $239.0 million, We continue to expect solid and growing cash
flows from both of these investments.
Cumulative investments in the Leucadia Asset Management platform
through the end of the third quarter total $487.0 million. Almost
all of this represents seed capital invested in liquid securities
managed by focused investment teams in which we have significant
confidence. We expect a reasonable return on our invested capital
and to earn an incremental return from our participation in the
results of the related management companies. Folger Hill Asset
Management, our multi-manager hedge fund platform, is in the
start-up phase of its development.
During the first quarter we increased our ownership to 20% of
Harbinger Group Inc., a diversified holding company which focuses
on acquiring and growing business that can, over the long-term,
generate sustainable free cash flow. The $545.8 million market
value of our interest in Harbinger as of September 30, 2014 is
32.8% above our purchase price of $411.1 million. Harbinger
reported record revenues and operating income for the third
quarter.
In September we invested $70.9 million in a joint venture with
Golden Queen Mining Co. Ltd. and the Clay family, a shareholder
group which owns 27% of Golden Queen, to jointly fund, develop and
operate the Soledad Mountain gold and silver mine project. The
project is a fully-permitted, open pit, heap leach gold and silver
project located just outside the town of Mojave in Kern County,
California. Construction has advanced smoothly during the third
quarter with commissioning planned for late 2015.
Our Oregon LNG project continues to work through the permitting
process. The next step is the issuance of the scheduling notice
from the Federal Energy Regulatory Commission (FERC), which we
expect before year-end.
As we announced in September, we have ceased further development
of our Lake Charles gasification project. We reached this
conclusion based on final estimates of the likely ultimate cost of
completion of the project. All project development costs to date
have been expensed, and wind-down costs accrued at the end of the
quarter were not material.
As planned, in July we closed on the sale of Premier
Entertainment LLC, which owns and operates the Hard Rock Hotel
& Casino in Biloxi; we received $250 million in cash.
For more information on the Company’s results of operations for
the third quarter and nine months ended September 30, 2014, please
see the Company’s Form 10-Q, which will be filed with the
Securities and Exchange Commission today.
This press release contains “forward looking statements” within
the meaning of the safe harbor provisions of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange
Act of 1934. Forward looking statements include statements about
our future and statements that are not historical facts. These
forward looking statements are usually preceded by the words
“should,” “expect,” “intend,” “may,” “will,” or similar
expressions. Forward looking statements may contain expectations
regarding revenues, earnings, operations, and other results, and
may include statements of future performance, plans, and
objectives. Forward looking statements also include statements
pertaining to our strategies for future development of our business
and products. Forward looking statements represent only our belief
regarding future events, many of which by their nature are
inherently uncertain. It is possible that the actual results may
differ, possibly materially, from the anticipated results indicated
in these forward looking statements. Information regarding
important factors, including Risk Factors, that could cause actual
results to differ, perhaps materially, from those in our forward
looking statements is contained in reports we file with the SEC.
You should read and interpret any forward looking statement
together with reports we file with the SEC.
SUMMARY FOR LEUCADIA
NATIONAL CORPORATION AND SUBSIDIARIES
(In thousands, except per share
amounts)
(Unaudited)
For the Three Month For the Nine Month
Period Ended
September 30,
Period Ended
September 30,
2014
2013
2014
2013
Net revenues
$ 3,003,643
$ 2,532,052 $
8,798,130 $ 7,504,922
Net realized securities gains
$
3,848 $ 4,987
$ 20,903 $
244,378 Income from continuing
operations before income taxes and income related to associated
companies $ 89,242 $ 32,843 $ 308,876 $ 425,250 Income
related to associated companies
28,917
23,889 84,298
89,560 Income from continuing
operations before income taxes 118,159 56,732 393,174 514,810
Income tax provision
59,906
26,758 163,885
106,881 Income from
continuing operations 58,253 29,974 229,289 407,929 Income
(loss) from discontinued operations, including gain on disposal,
net of taxes
2,009
(15,591 )
(10,640 )
(34,721 ) Net income 60,262 14,383
218,649 373,208 Net (income) loss attributable to the
noncontrolling interest 1,058 (253 ) (567 ) 1,098 Net
(income) attributable to the redeemable noncontrolling interests
(5,625 ) (10,132 ) (966 ) (11,239 ) Preferred stock
dividends
(1,016 )
(1,027 )
(3,047 )
(2,381 ) Net income attributable to
Leucadia National Corporation common shareholders
$
54,679 $ 2,971
$ 214,069 $
360,686 Basic earnings (loss) per common
share attributable to Leucadia National Corporation common
shareholders: Income from continuing operations $ .14 $ .05 $ .59 $
1.18 Income (loss) from discontinued operations, including gain on
disposal
- (.04
) (.03 )
(.10 ) Net income
$ .14
$ .01 $
.56 $ 1.08
Number of shares in calculation
373,347
367,641
371,372 331,091
Diluted earnings (loss) per common share attributable to
Leucadia National Corporation common shareholders: Income from
continuing operations $ .14 $ .05 $ .59 $ 1.16 Income (loss) from
discontinued operations, including gain on disposal
- (.04 )
(.03 ) (.10 )
Net income
$ .14 $
.01 $ .56
$ 1.06 Number of shares in
calculation
373,375
367,687 373,265
338,897
Leucadia National CorporationLaura Ulbrandt, 212-460-1900
Leucadia (NYSE:LUK)
Historical Stock Chart
From Feb 2024 to Mar 2024
Leucadia (NYSE:LUK)
Historical Stock Chart
From Mar 2023 to Mar 2024