CHICAGO, September 7, 2011 – Mesirow Financial today announced that fiscal 2011 was a year of record profitability, although revenues declined slightly due to its focus on gathering assets and improving the profitability of several newer businesses. Unconsolidated revenues1 for its fiscal year ended March 31, 2011, were $510 million, down just 3% from $526 million in fiscal 2010.
Chairman and Chief Executive Officer Richard S. Price stated that, "Mesirow Financial performed well during the year, despite a sluggish economy and prevailing uncertainty about a recovery." Privately held and employee-owned, Mesirow Financial offers expertise in Investment Management, Global Markets, Insurance Services and Consulting. Price added, "The firm's diverse range of capabilities and entrepreneurial environment makes it built to endure market cycles, financial crises and economic uncertainty." This year's top performers were Advanced Strategies, Institutional Sales and Trading, Private Equity and Currency Management.
Highlights from the fiscal year ended March 31, 2011 include:
Stockholders' equity, held by approximately 325 of its employees, was $302 million, compared to $299 million at the beginning of the year, after adjusting for the mandatory stock repurchase of its former CEO, the late James C. Tyree. That stock was redeemed out of company capital.
With an increasingly global client base, the firm noted that 16 percent of its revenues and approximately 60 percent of its assets under management came from foreign clients. Continuing its global strategy, the firm announced a joint venture in Abu Dhabi this year and the planned opening of an office in Hong Kong. Mesirow Financial currently employs nearly 1,200 professionals in offices across the country and in London.
Revenues from the Investment Management Division totaled $213 million, a 19% increase from $179 million last year, driven by new client inflows as well as improving asset values as the markets rebounded.
Assets under management rose to $55.4 billion at year end, up 37% from $40.3 billion a year ago. Alternative investments constitute 80% of overall assets. In addition, assets as of June 30, 2011, increased to $57.3 billion, as the firm continues to be a premier multi-asset investment manager serving institutional, corporate and private clients across the globe.
Less volatility, as well as a difficult credit environment, led to a decline in Global Markets revenues to $153 million from $196 million last year.
Although revenues in its Institutional Sales and Trading business were down 28%, fiscal 2011 was still the unit's second best year ever, having realized unusually strong trading gains in fiscal 2010. This year, the firm served as underwriter on more than 128 deals totaling more than $12.6 billion.
In Investment Banking, revenues increased 16% over last year. The group has a solid pipeline of future engagements and posted a record first quarter of fiscal 2012.
Insurance Services revenues were $88 million, nearly the same as last year, making the unit a consistent contributor to the firm's performance. The economic downturn impacted many of the Division's clients, lowering revenues and reducing headcounts, which had a downward effect on insurance premiums. Yet, it retained its Business Insurance ranking as the 23rd largest agency in the nation.
In May 2011, an Insurance Management Committee was formed to provide overall leadership and strategic direction for the Insurance business. Norm Malter was also named president of the agency and John Harney was appointed chief operating officer.
Its Consulting Division posted revenues of nearly $46.5 million, compared with $58.4 million for fiscal 2010, due largely to the uncertain economic recovery.
While a lack of large corporate bankruptcies limited revenues in Mesirow Financial Consulting, the group participated in an increased number of litigation engagements. By broadening its platform more than three years ago, the unit developed a flexible practice that is poised for growth in all market cycles. The first quarter of fiscal 2012 brought strong utilization levels.
Overall, for the first quarter of fiscal 2012 ended June 30, 2011, Mesirow Financial had unconsolidated revenues of $136 million, exceeding budget for the same period. Positive operating results were reflected in a number of businesses including Investment Banking, Consulting, Advanced Strategies and Institutional Sales and Trading. Given the volatility of the marketplace, results going forward are contingent on future market conditions.
For more information on Mesirow Financial, please view Mesirow Financial's 2011 annual report, "Built to Endure," which outlines the distinguishing characteristics and core values that have served the firm and its clients well over the years.
Mesirow Financial is a diversified financial services firm headquartered in Chicago. Founded in 1937, it is an independent, employee-owned firm with 1,200 employees in locations across the country and in London. With expertise in Investment Management, Global Markets, Insurance Services and Consulting, Mesirow Financial strives to meet the financial needs of institutions, public sector entities, corporations and individuals. For more information about Mesirow Financial, visit its website at mesirowfinancial.com.
The Mesirow Financial name and logo are registered service marks of Mesirow Financial Holdings, Inc., © 2011, Mesirow Financial Holdings, Inc. All rights reserved. The information contained herein has been obtained from sources believed to be reliable, but is not necessarily complete and its accuracy cannot be guaranteed. Any opinions expressed are subject to change without notice. It should not be assumed that any recommendations incorporated herein will be profitable or will equal past performance. Nothing contained herein constitutes an offer to sell or a solicitation of an offer to buy an interest in any Mesirow Financial investment vehicle(s).
Securities offered through Mesirow Financial, Inc. member NYSE, SIPC. Insurance services provided through Mesirow Insurance Services, Inc.