UNITED STATES SECURITIES
AND EXCHANGE COMMISSION
Washington, D.C. 20549
State
of Incorporation: DELAWARE · I.R.S. Employer
Identification No.: 43-1288229
One North Jefferson Avenue, St. Louis, Missouri 63103
Registrant’s
telephone number, including area code: (314) 955-3000
Securities registered pursuant to Section 12(b) of the Act:
| TITLE OF EACH CLASS | NAME OF
EACH EXCHANGE ON WHICH REGISTERED |
| | |
| Common Stock, $1 par value | New York Stock Exchange |
| Rights to purchase common stock | New York Stock Exchange |
Securities registered pursuant to Section 12(g) of the Act: NONE
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes |X| No |_|.
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. |X|
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act). Yes |X| No |_|.
The aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity price of such common equity, as of August 31, 2002, was $3.0 billion.
At May 1, 2003, there were 80,164,462 shares of A.G. Edwards, Inc. common stock, $1 par value, outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the A.G. Edwards, Inc. Proxy Statement filed with the SEC in connection with the Company’s Annual Meeting of Stockholders to be held June 19, 2003, (the “Company’s 2003 Proxy Statement”) are incorporated by reference into Part III hereof. Other documents incorporated by reference in this report are listed in the Exhibit Index of this Form 10-K.
A.G. EDWARDS, INC.
TABLE OF CONTENTS
PART I
ITEM 1. BUSINESS.
(a) General Development of Business
A.G. Edwards, Inc., a Delaware corporation, is a holding company incorporated in 1983 whose principal subsidiary, A.G. Edwards & Sons, Inc. (Edwards), is successor to a partnership founded in 1887. A.G. Edwards, Inc. and its directly-owned and indirectly-owned subsidiaries (collectively referred to as the “Company”) provide securities and commodities brokerage, investment banking, trust, asset management, retirement planning and insurance products and other related financial services to individual, corporate, governmental and institutional clients. At February 28, 2003, the Company had more than 700 locations in 49 states, the District of Columbia, and London, England, and more than 16,100 full-time employees, including approximately 7,200 financial consultants providing services for approximately 3,600,000 clients.
Edwards is a broker-dealer whose business, primarily with individual clients, is conducted through one of the largest retail branch office networks (based upon number of offices and financial consultants) in the United States. No single client accounts for a significant portion of Edwards’ business. Edwards is a member of all major securities exchanges in the United States, the National Association of Securities Dealers, Inc. (NASD) and the Securities Investor Protection Corporation (SIPC). In addition, Edwards has memberships on several domestic commodity exchanges and is registered with the Commodity Futures Trading Commission (CFTC) as a futures commission merchant (FCM).
AGE Commodity Clearing Corp. (Clearing), a commodity clearing subsidiary, is registered with the CFTC as a FCM and operates exclusively as a commodity clearing company for Edwards. Clearing is a member of all major U.S. commodities exchanges and the National Futures Association (NFA). A.G. Edwards Trust Company FSB (Trust Company) is a federally chartered savings bank that provides investment advisory, portfolio management and trust services. A.G. Edwards & Sons (U.K.) Limited is a securities broker-dealer located in London, England. A.G. Edwards Capital, Inc. serves as general partner to four private equity partnerships formed to invest in portfolios of venture capital and buy-out funds and direct investments. A.G. Edwards Technology Group, Inc. provides information technology services to the Company. Beaumont Insurance Company is a Vermont captive insurance company that centralizes risk management and provides access to reinsurance markets.
(b) Financial Information About Industry Segments
The Company operates and is managed as a single business segment providing investment services to its clients. These services are provided using the same sales and distribution personnel, support services and facilities, and all are provided to meet the needs of its clients. The Company does not identify or manage assets, revenues or expenses resulting from any service, or class of services, as a separate business segment.
(c) Narrative Description of Business
The total amount of revenue by class of products or services that accounted for 10% or more of consolidated net revenues are set forth under Item 6 of this 10-K under the caption “Consolidated Five-Year Summary.”
Commissions
Commission revenue represents the most significant source of revenue for the Company, accounting for more than 40% of total revenue during the last five years. The following briefly describes the Company’s sources of commission revenue.
Listed and Over-the-Counter Securities. A significant portion of the Company’s revenue is derived from commissions generated on securities transactions executed by Edwards, as a broker, in common and preferred stocks and debt instruments on exchanges or in the over-the-counter markets. Edwards’ brokerage clients are primarily individual investors; however, resources continue to be directed to further the development of its institutional business. Edwards’ commission rates for brokerage transactions vary with the size and complexity of the transactions, among other factors.
3
Options. Edwards acts as broker in the purchase and sale of option contracts to buy or sell securities, primarily common stocks and stock indexes. Edwards holds memberships for trading on the principal option exchanges.
Mutual Funds. Edwards distributes mutual fund shares in continuous offerings of open-end funds. Income from the sale of mutual funds is derived primarily from the standard dealer’s discount, which varies as a percentage of the client’s purchase price depending on the size of the transaction and terms of the selling agreement. Revenues derived from mutual fund sales continue to be a significant portion of overall revenues. Edwards does not sponsor its own mutual fund products.
Commodities and Financial Futures. Edwards acts as broker in the purchase and sale of commodity futures contracts, financial futures contracts and options on commodity and financial futures contracts. These contracts cover agricultural products, precious metals, currency, interest rate and stock index futures. Substantially all of Edwards’ clients’ futures transactions are executed and cleared through Clearing.
Insurance. As agent for several unaffiliated life insurance companies, Edwards distributes life insurance and tax-deferred annuities. Edwards also provides financial planning services to assist individuals in structuring financial portfolios to achieve their financial goals.
Asset Management and Service Fees
Asset management and service fees consist primarily of revenues earned for providing support and services in connection with assets under third-party management, including mutual funds, and revenues from assets under management by Edwards. These revenues include fees based on the amount of client assets under management and transaction-related fees as well as fees related to the administration of custodial and other specialty accounts.
Edwards, through the Trust Company, provides its clients with personal trust, employee benefit trust and custodial trust services.
Clients desiring professional money management are offered various types of account portfolio services. Edwards, acting as investment manager, offers portfolio management strategies based on the client’s investment objectives. Edwards’ investment consulting service offers the Private Advisor Service and Select Advisor, which provide clients third-party investment management, performance measurement, management search and related consulting services. The PathwaysSM, Spectrum, Cyclical Asset Allocation Portfolio, Professional Fund Advisor and Mutual Fund Marketplace (formerly known as Fund Advisor) investment advisory programs are personalized, fee-based asset allocation programs that utilize load and no-load mutual fund investments. Clients select from established asset allocation models, or customize their own, based on their investment objectives, risk tolerance and time horizon. In addition, under the Client Choice program, clients can execute transactions and receive ongoing personalized advice from their financial consultant for an annual fee based on the value of their assets held at Edwards.
Edwards offers the UltraAsset Account, Total Asset Account® and the Cash Convenience Account, which combine a full-service brokerage account with a money market fund. These programs provide for the automatic investment of customer free credit balances in one of several money market funds. Interest is not paid on uninvested credit balances held in client accounts. In addition, the UltraAsset and Total Asset Accounts allow clients access to their margin and money market accounts through the use of debit cards and checking account services provided by a major bank. The UltraAsset Account offers additional advanced features and special investment portfolio reports.
Edwards provides custodial services to its clients for the various types of self-directed individual retirement accounts as provided under the Internal Revenue Code.
Principal Transactions
Client transactions in the equity and fixed-income over-the-counter markets may be affected by Edwards acting as principal as well as agent. Principal transactions, including market making, require maintaining inventories of securities to satisfy customer order flow. These securities are valued in the Company’s consolidated financial statements at fair value and unrealized gains or losses are included in the results of operations.
Investment Banking
Edwards is an underwriter for public offerings of corporate and municipal securities as well as corporate and municipal unit investment trusts and closed-end investment companies. Edwards’ public finance activities include
4
areas of specialization for municipal and governmental entities in primary and secondary schools, sports and entertainment, municipal finance, housing, higher education, health care, and public utilities. Corporate finance activities are focused on three industry groups: financial institutions and real estate, energy, and emerging growth. As an underwriter, usually in conjunction with other broker-dealers, Edwards purchases securities for resale to its clients. Edwards acts as an advisor to corporations and municipal entities in reviewing strategical capital needs and determining the most advantageous means for raising capital. It also advises clients in merger and acquisition activities and acts as agent in private placements.
Margin Financing
Securities transactions are executed on a cash or margin basis. In margin transactions, Edwards extends credit to its clients for a portion of the purchase price, and the clients’ securities are held as collateral. The amount of credit is limited by the initial margin regulations issued by the Board of Governors of the Federal Reserve System. The current prescribed minimum initial margin for equity securities is equal to 50% of the value of equity securities purchased. The regulations of the various exchanges require minimum maintenance margins, which are below the initial margin. Edwards’ maintenance requirements generally exceed the exchanges’ requirements. Such requirements are intended to reduce the risk that a market decline will reduce the value of the collateral below that of the client’s indebtedness before the collateral can be liquidated.
The Company utilizes a variety of sources to finance client margin accounts, including its stockholders’ equity, customer free credit balances and, to the extent permitted by regulations, cash received from loans of the clients’ collateral securities to other brokers and borrowings from banks, either unsecured or secured by the clients’ collateral securities.
Private Client Services
Edwards’ Private Client Services group assists individuals and businesses with a wide range of financial and investment needs. Individual investors can receive tailored asset allocation, tax- and risk-reduction strategies, portfolio reviews of stocks, bonds and mutual funds (including concentrated equity strategies) and comprehensive estate planning recommendations. Closely-held and publicly-traded business clients can access services for risk management, employee benefit programs (retirement plans and key employee compensation), capital formation and management and ownership succession.
CPI Qualified Plan Consultants, Inc., a wholly-owned subsidiary of the Company, provides third-party administration services for employee benefit plans to closely-held businesses and corporations.
Investment Activities
The Company’s investment activities primarily include investing in equity and equity-related securities in connection with private investment transactions, either for the accounts of Company-sponsored private equity partnerships or for its own account. These activities include mutual fund investments, including those made in connection with its deferred compensation plan, venture capital investments, and investments in portfolio and operating companies. A.G. Edwards Capital, Inc is general partner to the Company-sponsored private equity partnerships and provides them with investment advisory and administrative services. The fair value of these investments is subject to a higher degree of volatility and may include significant risks of loss while attempting to obtain higher returns than those available from publicly-traded securities.
Research
Edwards provides both technical market and fundamental analysis of numerous industries and individual securities for use by its financial consultants and clients. In addition, review and analysis of general economic conditions, along with asset allocation recommendations, are available. These services are provided by Edwards’ research analysts, economists and market strategists.
Competition
All aspects of the Company’s business are highly competitive. Edwards competes with numerous broker-dealers, including on-line services, some of which possess greater financial resources than the Company. Edwards
5
competes for clients on the basis of price, quality of service, financial resources and reputation. There is constant competition to attract and retain personnel within the securities industry.
In addition to competition from firms traditionally engaged in the financial services business, there has been increased competition in recent years from other sources such as commercial banks, insurance companies, online service providers, mutual fund sponsors and other companies offering financial services both in the United States and globally, for a similar client base, including the client base served by the Company. The financial services industry continues to experience consolidation and convergence as financial institutions offering a range of financial services have begun offering a broader array of securities and other investment products or have acquired securities firms to reach different markets. These trends may continue and could result in the Company’s competitors acquiring greater capital and other resources, as well as a broader range of products and services, and geographic diversity.
Regulation
Edwards, as a broker-dealer and FCM, is subject to various federal and state laws that specifically regulate its activities as a broker-dealer in securities and commodities, as an investment advisor and as an insurance agent. Clearing, as a FCM, is regulated as a broker in commodities. Edwards and Clearing are also subject to various regulatory requirements imposed by the securities and commodities exchanges and the NASD. The primary purpose of these requirements is to enhance the protection of customer assets. Under certain circumstances, these rules may limit the ability of the Company to make withdrawals of capital from Edwards and Clearing. These laws and regulatory requirements generally subject Edwards and Clearing to standards of solvency with respect to capital requirements, financial reporting requirements, approval of qualifications of personnel engaged in various aspects of its business, record keeping and business practices, the handling of their clients’ funds resulting from securities and commodities transactions, and the extension of credit to clients on margin transactions. Infractions of these rules and regulations may include suspension or monetary penalties against individual employees or their supervisors, termination of employees, and limitations on certain aspects of Edwards’ and Clearing’s regulated businesses, as well as censures and fines or proceedings of a civil or criminal nature that could result in a temporary or permanent suspension of a part or all of Edwards’ and Clearing’s activities.
As a registered broker-dealer, Edwards is subject to net capital rules administered by the Securities and Exchange Commission (SEC) and the New York Stock Exchange. Under such rules, this subsidiary must maintain net capital of not less than 2 percent of aggregate debit items, as defined, arising from customer transactions and would be restricted from expanding its business or paying cash dividends or advancing loans to affiliates if its net capital were less than 5 percent of such items. These rules also require Edwards to notify and sometimes obtain approval of the SEC and other regulatory organizations for substantial withdrawals of capital or loans to affiliates. At February 28, 2003, the subsidiary’s net capital of $606 million was 30 percent of aggregate debit items and $566 million in excess of the minimum required.
Certain other subsidiaries are also subject to minimum capital requirements that may restrict the payment of cash dividends and advances to A.G. Edwards, Inc. The only restriction with regard to the payment of cash dividends by A.G. Edwards, Inc. is its ability to obtain cash through dividends and advances from its subsidiaries or borrowings, if needed.
A.G. Edwards & Sons (U.K.) Limited is registered under the laws of the United Kingdom and is regulated as a securities broker-dealer by the Financial Services Authority. The Trust Company, a federal savings bank, is regulated by the Office of Thrift Supervision, the Federal Deposit Insurance Corporation and by the SEC as an investment advisor. A.G. Edwards Capital, Inc. is registered with the SEC as an investment advisor. Beaumont Insurance Company is regulated by the Vermont Department of Banking, Insurance, Securities and Health Care Administration.
(d) Financial information about geographic areas
Revenues from the Company’s non-U.S. operations are currently not material.
(e) Available Information
A.G. Edwards, Inc. files annual, quarterly and current reports, proxy statements and other information with the Securities and Exchange Commission (SEC).
6
The public may read and copy A.G. Edwards, Inc.’s annual report on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K and any amendments to these reports filed with the SEC at the SEC’s Public Reference Room at 450 Fifth Street, NW., Washington, DC 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. This information may also be obtained from the SEC’s web site at http://www.sec.gov.
A.G. Edwards, Inc. makes available at http://www.agedwards.com, free of charge, its most recent annual report on Form 10-K, its quarterly reports on Form 10-Q for the current fiscal year, current reports on Form 8-K and amendments to these reports, its most recent proxy statement and its most recent summary annual report to shareholders. In some cases these documents may not be available on the Company’s web site as soon as they are available on the SEC’s web site.
ITEM 2. PROPERTIES.
The Company’s headquarters are located at One North Jefferson Avenue, St. Louis, Missouri, 63103. It consists of several buildings owned by the Company, which contain approximately 1,700,000 square feet of general office space as well as underground and surface parking and two parking garages. In addition, the Company owns two additional office buildings in the St. Louis area, which are used for information technology and contingency planning facilities. The Company is currently expanding its headquarters with an additional office building and learning center of approximately 1,100,000 square feet. The Company’s branch offices, with a few exceptions, occupy leased premises throughout the United States as well as an office in London, England.
ITEM 3. LEGAL PROCEEDINGS.
(a) Litigation
The Company is a defendant in a number of lawsuits, in some of which plaintiffs claim substantial amounts, relating primarily to its securities and commodities business. Management has determined that it is likely that ultimate resolution in favor of the plaintiffs will result in losses to the Company on certain of these claims. Factors considered by management in estimating the Company’s liability are the loss and damages sought by the plaintiffs, the merits of the claims, the total cost of defending the litigation, the likelihood of a successful defense against the claims, and the potential for fines and penalties from regulatory agencies. Management, based on its understanding of the facts, reasonably estimates a range of loss and accrues what it considers appropriate to reserve against probable loss for certain claims. While results of litigation cannot be predicted with certainty, management, after consultation with counsel, believes that resolution of all such litigation is not expected to have a material adverse effect on the consolidated balance sheets, statements of earnings or statements of cash flows of the Company.
(b) Proceedings Terminated During the Fourth Quarter of the Fiscal Year Covered by This Report
Not applicable.
7
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There were no matters submitted to a vote of security holders during the fourth quarter of the fiscal year ended February 28, 2003.
Executive Officers of the Company
The following table sets forth the executive officers of the Company as of May 1, 2003. Executive officers are appointed by the Board of Directors to hold office until their successors are appointed and qualified.
| Name | Age | Office and Title | Year
First Appointed Executive Officer of the Company | |||
|
|
|
|||||
| Robert L. Bagby | 59 | Chairman of the Board and Chief Executive Officer | 1991 | |||
| of the Company and Edwards since 2001. Vice | ||||||
| Chairman of the Board, Executive Vice President | ||||||
| and Director of the Branch Division of Edwards | ||||||
| prior to March 2001. Employee of Edwards for 28 | ||||||
| years. Director of Edwards since 1979. | ||||||
| Ronald J. Kessler | 55 | Vice Chairman of the Board of the Company and | 1996 | |||
| Edwards since 2001. Executive Vice President of | ||||||
| Edwards. Director of the Operations Division since | ||||||
| 1998. Assistant Director of Operations prior to | ||||||
| 1998. Employee of Edwards for 35 years. Director | ||||||
| of Edwards since 1989. | ||||||
| Mary V. Atkin | 48 | Executive Vice President of Edwards. President of | 1999 | |||
| A.G. Edwards Technology Group, Inc. since 2001. | ||||||
| Director of the Information Technology Division of | ||||||
| Edwards from 1999 to 2001. Manager of Corporate | ||||||
| Communications of Edwards prior to 1999. | ||||||
| Employee of Edwards for 25 years. Director of | ||||||
| Edwards since 1993. | ||||||
| Donnis L. Casey | 55 | Executive Vice President of Edwards. Director of | 1996 | |||
| the Staff Division of Edwards since 1996. | ||||||
| Employee of Edwards for 36 years. Director of | ||||||
| Edwards since 1993. | ||||||
| Charles J. Galli | 62 | Senior Vice President of Edwards. Regional | 2001 | |||
| Manager since 1988. Employee of Edwards for 24 | ||||||
| years. Director of Edwards since 1990. | ||||||
| Alfred E. Goldman | 69 | Corporate Vice President, Director of Market | 1991 | |||
| Analysis of Edwards. Employee of Edwards for 43 | ||||||
| years. Director of Edwards since 1967. | ||||||
| Richard F. Grabish | 54 | Chairman and Chief Executive Officer of A.G. | 2001 | |||
| Edwards Trust Company since 2001. President of | ||||||
| A.G. Edwards Trust Company from 1987 to 2001. | ||||||
| Senior Vice President of Edwards. Assistant | ||||||
| Director of Sales and Marketing Division of | ||||||
| Edwards. Employee of Edwards for 22 years. | ||||||
| Director of Edwards since 1988. |
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| Name | Age | Office and Title | Year
First Appointed Executive Officer of the Company | |||
| |
|
|||||
| Douglas L. Kelly | 54 | Vice President, Secretary and, since 2001, Chief | 1994 | |||
| Financial Officer and Treasurer of the Company. | ||||||
| Executive Vice President, Secretary, Director of | ||||||
| Law and Compliance, Chief Financial Officer, | ||||||
| Treasurer and Director of Administration of | ||||||
| Edwards. Employee of Edwards for 9 years. | ||||||
| Director of Edwards since 1994. | ||||||
| Thomas H. Martin Jr | 43 | Assistant Treasurer of the Company since 1999. | 1999 | |||
| Vice President of Edwards. Controller of the | ||||||
| Company and Edwards since 1999. Accounting | ||||||
| Manager prior to 1999. Employee of Edwards for | ||||||
| 22 years. | ||||||
| Peter M. Miller | 45 | Executive Vice President of Edwards. Director of | 2002 | |||
| Sales and Marketing of Edwards since July, 2002. | ||||||
| Regional Manager from 1995 to 2002. Employee | ||||||
| of Edwards for 14 years. Director of Edwards | ||||||
| since 1997. | ||||||
| Paul F. Pautler | 57 | Executive Vice President of Edwards. Director of | 2000 | |||
| Investment Banking of Edwards since 2000. Director | ||||||
| of Corporate Finance of Edwards from 1999 to 2001. | ||||||
| Managing Director of Mergers and Acquisitions from | ||||||
| 1997 to 1999. Employee of Edwards for 5 years. | ||||||
| Director of Edwards since 2000. | ||||||
| Robert A. Pietroburgo | 46 | Executive Vice President and Director of the Branch | 2001 | |||
| Division of Edwards since 2001. Regional Manager | ||||||
| of Edwards from 2000 to 2001. Branch Manager of | ||||||
| Edwards prior to 2000. Employee of Edwards for | ||||||
| 16 years. Director of Edwards since 2001. | ||||||
| Joseph G. Porter | 42 | Assistant Treasurer of the Company since 1999. | 1999 | |||
| Senior Vice President and Assistant Director of | ||||||
| Administration of Edwards since 2000. Principal | ||||||
| Accounting Officer of the Company and Edwards | ||||||
| since 1999. Accounting Manager prior to 1999. | ||||||
| Employee of Edwards for 20 years. Director of | ||||||
| Edwards since 2001. |
9
PART II
| ITEM 5. | MARKET FOR THE
REGISTRANT’S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS. |
Quarterly
Financial Information
(Unaudited)
| Dividends Declared per Share |
Stock
Price Trading Range High – Low |
Net Revenues (in millions) |
Earnings (Loss) Before Tax (in millions) |
Net Earnings (Loss) (in millions) |
Earnings
(Loss) per Share | |||||||||||||||||||||||||||
|
| ||||||||||||||||||||||||||||||||
| Diluted | Basic | |||||||||||||||||||||||||||||||
| Fiscal 2003 by Quarter | ||||||||||||||||||||||||||||||||
| First | $ | 0.16 | $47.75 | – $ | 38.85 | $ | 598.2 | $ | 61.0 | $ | 39.1 | $ | 0.48 | $ | 0.48 | |||||||||||||||||
| Second | $ | 0.16 | $39.75 | – $ | 28.80 | $ | 569.1 | $ | 41.3 | $ | 26.6 | $ | 0.33 | $ | 0.34 | |||||||||||||||||
| Third | $ | 0.16 | $38.20 | – $ | 26.50 | $ | 513.0 | $ | 36.3 | $ | 32.0 | $ | 0.39 | $ | 0.40 | |||||||||||||||||
| Fourth | $ | 0.16 | $37.04 | – $ | 25.50 | $ | 513.7 | $ | 32.8 | $ | 21.2 | $ | 0.26 | $ | 0.26 | |||||||||||||||||
| Fiscal 2002 by Quarter | ||||||||||||||||||||||||||||||||
| First | $ | 0.16 | $44.75 | – $ | 31.80 | $ | 605.7 | $ | 70.9 | $ | 45.3 | $ | 0.56 | $ | 0.57 | |||||||||||||||||
| Second | $ | 0.16 | $48.29 | – $ | 40.00 | $ | 596.8 | $ | 62.1 | $ | 41.0 | $ | 0.50 | $ | 0.51 | |||||||||||||||||
| Third | $ | 0.16 | $44.75 | – $ | 29.76 | $ | 555.9 | $ | 24.4 | $ | 22.2 | $ | 0.28 | $ | 0.28 | |||||||||||||||||
| Fourth | $ | 0.16 | $46.70 | – $ | 38.85 | $ | 580.0 | $ | (65.3 | ) | $ | (37.0 | ) | $ | (0.46 | ) | $ | (0.46 | ) | |||||||||||||
Annual Meeting
The 2003 Annual Meeting of Stockholders will be held at the Company’s headquarters, One North Jefferson, St. Louis, Missouri, on Thursday, June 19, 2003, at 10 a.m. The Notice of Annual Meeting, Proxy Statement and Proxy Voting Card are mailed in May to each stockholder. The Proxy Statement describes the items of business to be voted on at the Annual Meeting and provides information on the Board of Directors’ nominees for director and their principal affiliations with other organizations as well as other information about the Company.
Dividend Payment Dates
The next four anticipated dividend payment dates are July 1 and October 1, 2003, and January 2 and April 1, 2004.
Stock Exchange Listing
A.G. Edwards, Inc. stock is traded on the New York Stock Exchange under the symbol AGE. The approximate number of stockholders on February 28, 2003, was 24,200. The approximate number of equity security holders of record includes customers who hold the Company’s stock in their accounts on the books of Edwards.
Registrar/Transfer
Agent
The Bank of New York
Shareholder Relations
Department — 11E
P.O. Box 11258
Church Street Station
New York, New York 10286-1258
(800) 524-4458
10
ITEM 6. SELECTED FINANCIAL DATA.
Consolidated Five-Year Summary
| Year Ended | February
28, 2003 |
February
28, 2002 |
February
28, 2001 |
February
29, 2000 |
February
28, 1999 |
||||||||||
| |
|||||||||||||||
(In
thousands, except per share amounts) | |||||||||||||||
| Revenues | |||||||||||||||
| Commissions: | |||||||||||||||
| Listed securities | $ | 387,483 | $ | 403,921 | $ | 482,136 | $ | 537,005 | $ | 505,226 | |||||
| Options | 23,485 | 28,453 | 55,883 | 62,708 | 49,830 | ||||||||||
| Over-the-counter securities | 70,864 | 111,065 | 295,921 | 331,992 | 199,472 | ||||||||||
| Mutual funds | 201,567 | 214,339 | 293,307 | 312,833 | 281,782 | ||||||||||
| Commodities | 26,371 | 17,966 | 16,540 | 17,305 | 15,518 | ||||||||||
| Insurance | 185,249 | 174,281 | 184,762 | 164,583 | 128,109 | ||||||||||
| Total | 895,019 | 950,025 | 1,328,549 | 1,426,426 | 1,179,937 | ||||||||||
| Asset management and service fees | 625,626 | 659,282 | 652,998 | 544,531 | 426,967 | ||||||||||
| Principal transactions: | |||||||||||||||
| Equities | 58,436 | 73,553 | 114,363 | 90,202 | 60,538 | ||||||||||
| Debt securities | 252,688 | 246,131 | 177,912 | 194,016 | 141,484 | ||||||||||
| Total | 311,124 | 319,684 | 292,275 | 284,218 | 202,022 | ||||||||||
| Investment banking: | |||||||||||||||
| Underwriting fees and selling concessions | 184,220 | 186,839 | 144,725 | 190,236 | 163,419 | ||||||||||
| Management fees | 66,960 | 69,590 | 28,572 | 35,483 | 55,582 | ||||||||||
| Total | 251,180 | 256,429 | 173,297 | 225,719 | 219,001 | ||||||||||
| Interest: | |||||||||||||||
| Margin account balances | 86,189 | 150,365 | 331,980 | 225,319 | 170,982 | ||||||||||
| Securities owned and deposits | 19,838 | 21,603 | 28,419 | 23,269 | 30,530 | ||||||||||
| Total | 106,027 | 171,968 | 360,399 | 248,588 | 201,512 | ||||||||||
| Other | 10,239 | 6,592 | 31,630 | 89,525 | 11,360 | ||||||||||