Summit Financial Services Announces First Quarter Results and Record Revenues

2007-05-15 23:00:34 -

BOCA RATON, Fla., May 15 /PRNewswire-FirstCall/ -- Summit Financial Services Group, Inc. (BULLETIN BOARD: SFNS) today reported financial results, including record revenues, for the First Quarter ended March 31, 2007.

First Quarter 2007 v. First Quarter 2006 -- Total revenues (including commission revenues) increased approximately 38.4% to $9,161,792 million from $6,618,380 million; and -- Commission revenues increased approximately 40.3% to $8,823,087 million from $6,289,885 million. -- Net income increased approximately 74.6% from $106,455 from $60,967. Business Overview

The Company is a Florida-based financial services holding company that provides,

through its operating subsidiary, Summit Brokerage Services, Inc. ("Summit Brokerage"), a broad range of securities brokerage and investment services to primarily individual investors. Summit Brokerage also sells insurance products, predominantly fixed and variable annuities and life insurance through its subsidiary, SBS Insurance Agency of Florida. Summit Brokerage also provides asset management services through its registered investment advisor, Summit Financial Group, Inc.

Summit Brokerage is registered with the Securities and Exchange Commission (SEC), and is a member of the NASD, the Municipal Securities Rule Making Board, and the National Futures Association. The Company currently offers its services through a network of approximately 210 registered representatives, and its business plan is focused primarily on increasing its network of affiliated registered representatives through recruitment as well as by acquisitions.

Marshall Leeds, the Company's Chairman, Chief Executive Officer and President, stated: "Improvements in both revenues and earnings are largely attributable to the net addition, during both 2006 and 2007, of financial advisors whose average gross production exceeded the average gross production of the then existing Summit advisors. These improvements were partially offset by Summit's continued investment in its recruiting efforts and the development of its infrastructure."

SUMMIT FINANCIAL SERVICES GROUP, INC. AND SUBSIDIARIES Condensed Consolidated Statement of Financial Condition March 31, 2007 ASSETS Cash and cash equivalents $3,694,812 Deposit held at clearing broker 27,252 Securities owned, at fair value 8,823 Commissions receivable 1,778,466 Prepaid expenses 258,876 Other receivables, net 298,238 Goodwill & customer list, less accumulated amortization of $773,019 815,555 Property and equipment at cost, less accumulated depreciation of $91,114 108,266 TOTAL ASSETS $6,990,288 LIABILITIES AND STOCKHOLDERS' EQUITY LIABILITIES Accounts payable and accrued expenses $776,585 Accrued commission expense 2,294,448 TOTAL LIABILITIES 3,071,033 STOCKHOLDERS' EQUITY Preferred stock, undesignated; par value $0.0001 per share; authorized 4,850,000 shares; none issued and outstanding -- Preferred stock, Series A, 12% cumulative convertible; par value $0.0001 per share; authorized 150,000 shares; 125,000 issued and outstanding (liquidation preference of $125,000) 13 Common stock, par value $0.0001 per share; authorized 100,000,000 shares; 28,224,987 issued and 28,210,075 outstanding 2,822 Additional paid-in capital 9,614,076 Unearned stock-based compensation (686,020) Treasury stock (14,912 shares, at cost) (10,884) Accumulated deficit (5,000,752) TOTAL STOCKHOLDERS' EQUITY 3,919,255 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $6,990,288 Condensed Consolidated Statements of Income March 31, 2007 For The Three Months Ended March 31, 2007 2006 (Unaudited) (Unaudited) REVENUES Commissions $8,823,087 $6,289,885 Interest and dividends 267,337 237,822 Other 71,368 90,673 9,161,792 6,618,380 EXPENSES Commissions and clearing costs 7,291,962 5,108,113 Employee compensation and benefits 1,065,519 795,106 Occupancy and equipment 184,169 116,926 Communications 87,989 96,626 Legal, accounting and litigation costs (21,459) 69,998 Depreciation and amortization 56,362 51,716 Other operating expenses 390,795 318,928 9,055,337 6,557,413 NET INCOME BEFORE INCOME TAXES 106,455 60,967 PROVISION FOR INCOME TAXES -- -- NET INCOME $106,455 $60,967 BASIC EARNINGS PER SHARE $0.0038 $0.0022 DILUTED EARNINGS PER SHARE $0.0035 $0.0021 WEIGHTED AVERAGE SHARES OUTSTANDING BASIC 28,210,075 28,210,075 DILUTED $30,036,568 $29,115,627 "Forward-looking" Statements

This press release may contain "forward-looking" statements, as defined in the Private Securities Litigation Reform Act of 1995 or by the Securities and Exchange Commission. Any such statements are made pursuant to the safe-harbor provisions of Section 21E of the Securities Exchange Act of 1934 (as amended), and they involve a number of risks and uncertainties that could cause actual results to differ materially from those that may be anticipated by or from the forward-looking statements. Important factors that could cause such a difference are set forth in the Company's filings with the Securities and Exchange Commission and include, but are not limited to, investor confidence and the performance of the securities markets, and the availability of suitable candidates for the Company's acquisition or recruitment.

Source: Summit Financial Services Group, Inc.