B. Riley Financial Reports Second Quarter 2021 Results; Declares $2.00 Dividend

LOS ANGELES, July 29, 2021 /PRNewswire/ — B. Riley Financial, Inc. (NASDAQ: RILY), a diversified financial services company, today announced its financial results for the second quarter ended June 30, 2021.

Second Quarter 2021 Highlights

  • Net income available to common shareholders of $73.9 million, down 11% year-over-year
  • Total revenues of $336.8 million, up 26% year-over-year
  • Total adjusted EBITDA (1) of $124.9 million
  • Operating revenues (2) of $304.1 million, up 100% year-over-year
  • Operating adjusted EBITDA (3) of $92.1 million, up 97% year-over-year
  • Investment gains (4) of $32.7 million

Bryant Riley, Chairman and Co-Chief Executive Officer of B. Riley Financial, said: “Our operating EBITDA doubled on a year-over-year basis demonstrating continued strength across our businesses during the second quarter. Our results were driven by our investment banking division which continues to establish its leadership in small and mid-cap equity capital markets, supplemented by steady contributions from Advisory Services and Principal Investments. Increasing our capital base while simultaneously returning capital to shareholders and lowering our cost of capital has provided us with the financial flexibility to pursue the increasing number of opportunities that our diversified platform offers.”

Tom Kelleher, Co-Chief Executive Officer of B. Riley Financial, added: “Our recent addition of complementary businesses and key hires have helped increase synergies and cross-selling opportunities across our platform. As we continue to work towards integrating our colleagues from National Holdings and enhancing the services we offer to our clients, recruiting remains a key focus. We continue to seek out new talent and businesses that can expand our reach and capabilities across service lines.”

Riley added: “The successful execution of our platform strategy has allowed us to build a solid balance sheet while enabling us to return $8.50 in common stock dividends to shareholders over the last three quarters. As we look ahead, we see multiple pathways with which to grow shareholder value. We will continue to take advantage of market opportunities in our core segments while building on additional recurring revenue streams that are both noncorrelated and counter cyclical.”

Declaration of Common Stock Dividend
The Company’s Board of Directors has approved a total quarterly cash dividend of $2.00 per share which includes the regular $0.50 dividend and a special dividend of $1.50 per share. The dividend is payable on or about August 26, 2021 to common stockholders of record as of August 13, 2021.

Second Quarter 2021 Financial Summary
For the three months ended June 30, 2021, B. Riley Financial reported net income available to common shareholders of $73.9 million, or $2.58 per diluted share.

















Three Months Ended


Six Months Ended




June 30,


June 30,



(Dollars in thousands, except for share data)

 

2021


2020


2021


2020



Net income (loss) available to common shareholders

$

73,887


$

82,753


$

326,794


$

(16,967)



Basic income (loss) per common share 

$

2.70


$

3.23


$

12.03


$

(0.66)



Diluted income (loss) per common share 

$

2.58


$

3.07


$

11.39


$

(0.66)
















Total revenues were $336.8 million for the second quarter of 2021, a year-over-year increase of 26% compared to $266.5 million for the prior-year period. The Company reported total adjusted EBITDA (1) of $124.9 million for the quarter.

















Three Months Ended


Six Months Ended




June 30,


June 30,



(Dollars in thousands)

2021


2020


2021


2020



    Operating Revenues (2)

$

304,091


$

151,921


$

637,308


$

334,157



    Investment Gains (Loss)(4)


32,679



114,547



299,621



(67,895)



        Total Revenues

$

336,770


$

266,468


$

936,929


$

266,262



   Operating Adjusted EBITDA (3)

$

92,124


$

46,757


$

214,841


$

117,664



   Investment Adjusted EBITDA (5)


32,763



101,507



295,527



(65,465)



       Total Adjusted EBITDA (1)

$

124,887


$

148,264


$

510,368


$

52,199
















Second quarter operating revenues (2) were $304.1 million, a year-over-year increase of 100% from $151.9 million for the prior-year period. Operating adjusted EBITDA (3) of $92.1 million increased from $46.8 million for the prior-year period, up 97% year-over-year.

Operating results were enhanced by second quarter investment gains (4) of $32.7 million which are primarily driven by mark-to-market valuations on strategic investments held by the Company.

As of June 30, 2021, cash and investments (6) totaled approximately $2.0 billion including cash and cash equivalents of $297.4 million. Total cash and investments, (6) net of debt, was $568.1 million at quarter-end.

Segment Financial Summary for the Three Months Ended June 30, 2021

















    Operating Revenues(2)


    Investment Gains (Loss) (4)


Total Segment Revenue




Three Months Ended June 30,


Three Months Ended June 30,


Three Months Ended June 30,



(Dollars in thousands)

2021


2020


2021


2020


2021


2020



Capital Markets

$ 151,488


$ 84,870


$ 29,897


$ 114,080


$ 181,385


$ 198,950



Wealth Management

87,444


15,318


2,865


467


90,309


15,785



Auction and Liquidation

17,277


8,251




17,277


8,251



Financial Consulting

23,735


18,845




23,735


18,845



Principal Investments

19,646


21,431




19,646


21,431



Brands

4,501


3,206


(83)



4,418


3,206


















Segment Operating Income (Loss)(7)


    Investment Income (Loss) (5)


Total Segment Income (Loss)




Three Months Ended June 30,


Three Months Ended June 30,


Three Months Ended June 30,



(Dollars in thousands)

2021


2020


2021


2020


2021


2020



Capital Markets

$   74,701


$ 29,471


$ 29,981


$ 101,040


$ 104,682


$ 130,511



Wealth Management

(3,598)


(435)


2,865


467


(733)


32



Auction and Liquidation

3,555


2,020




3,555


2,020



Financial Consulting

4,175


3,504




4,175


3,504



Principal Investments

7,275


9,188




7,275


9,188



Brands

3,096


(6,318)


(83)



3,013


(6,318)
















  • Excluding investment gains, (4) Capital Markets operating revenues (2) increased to $151.5 million from $84.9 million from the prior-year period, up 78% year-over-year. Segment operating income (7) was $74.7 million, up 153% year-over-year, driven primarily by equity investment banking transactions.
  • Wealth Management revenues of $90.3 million increased from $15.8 million for the prior-year period. A majority of the increase in revenue was due to the inclusion of a full quarter of results from National Holdings which the Company acquired in February 2021. Combined wealth management assets under management totaled approximately $32 billion as of June 30, 2021.
  • Auction and Liquidation segment revenues increased to $17.3 million from $8.3 million for the prior-year period, up 109% year-over-year. Segment income increased to $3.6 million compared to $2.0 million for the prior-year period.
  • Financial Consulting revenues increased to $23.7 million from $18.8 million for the prior-year period, up 26% year-over-year. Segment income increased to $4.2 million from $3.5 million for the prior-year period.
  • Principal Investments companies, magicJack and United Online, contributed revenues of $19.6 million and segment income of $7.3 million. magicJack and United Online continued to perform above expectations, contributing recurring cash flow to the Company.
  • Brands generated revenues of $4.4 million and segment income of $3.0 million related to the licensing of brand trademarks.

Financial Highlights for the First Six Months of 2021

  • Total revenues increased to $936.9 million from $266.3 million, up 252% year-over-year.
  • Net income available to common shareholders of $326.8 million, or $11.39 per diluted share, increased compared to a net loss of ($17.0 million), or ($0.66) loss per diluted share for the prior year period.
  • Total adjusted EBITDA (1) of $510.4 million increased compared to $52.2 million for the prior-year period.
  • Operating revenues (2) increased to $637.3 million from $334.2 million, up 91% year-over-year.
  • Operating adjusted EBITDA (3) of $214.8 million increased 83% compared to $117.7 million for the prior-year period.
  • Excluding investment gains (losses), (4) Capital Markets operating revenues (2) increased to $359.4 million from $180.3 million, up 99% year-over-year. Segment operating income (7) totaled $180.7 million.
  • Wealth Management segment revenues increased to $158.2 million from $34.2 million, up 362% year-over-year.
  • Auction and Liquidation segment revenues increased to $30.7 million, up from $28.9 million for the prior-year period.
  • Financial Consulting segment revenues increased to $45.1 million, up from $39.6 million for the prior-year period.
  • Principal Investments contributed segment revenues of $40.2 million and segment income of $14.8 million.
  • Brands contributed segment revenues of $8.9 million and segment income of $6.1 million.

Additional Metrics and Supplemental Financial Data
Additional metrics related to operating results and investments are presented to provide investors with greater visibility into the Company’s performance and overall results of operations. Further details related to these metrics can be found in B. Riley Financial’s Second Quarter 2021 Financial Supplement located on the Company’s investor relations website.

Segment Realignment
The Company previously realigned its segment reporting structure for Wealth Management during the first quarter of 2021 as a result of the National Holdings acquisition, and Financial Consulting during the fourth quarter of 2020 to reflect certain organizational changes. Segment results have been recast for all periods presented in conjunction with the new reporting structure.

Conference Call Details
B. Riley Financial will host a conference call to discuss its second quarter 2021 financial results at 4:30 p.m. Eastern time (1:30 p.m. Pacific time) today, Thursday, July 29, 2021. Investors may access the live broadcast and archived recording via the Company’s investor relations website.

About B. Riley Financial
B. Riley Financial provides collaborative solutions tailored to fit the capital raising and business advisory needs of its clients and partners. B. Riley operates through several subsidiaries that offer a diverse range of complementary end-to-end capabilities spanning investment banking and institutional brokerage, private wealth and investment management, financial consulting, corporate restructuring, operations management, risk and compliance, due diligence, forensic accounting, litigation support, appraisal and valuation, auction and liquidation services. For more information, please visit www.brileyfin.com.

Footnotes (See “Note Regarding Use of Non-GAAP Financial Measures” for further discussion of these non-GAAP terms.)

(1)

Adjusted EBITDA includes earnings before interest, taxes, depreciation, amortization, restructuring costs, share-based payments, gain on extinguishment of loans, impairment of tradenames, and transaction related and other costs. For a definition of adjusted EBITDA and a reconciliation to GAAP financial measures, please see the Appendix hereto.

(2)

Operating revenue is defined as the sum of revenues from services and fees, interest income – loans and securities lending, and sale of goods.

(3)

Operating adjusted EBITDA is defined as adjusted EBITDA excluding trading income (losses) and fair value adjustments on loans and other investment related expenses.

(4)

Investment gains (loss) is defined as trading income and fair value adjustments on loans.

(5)

Investment adjusted EBITDA and investment income (loss) are defined as trading income (losses) and fair value adjustments on loans, less other investment related expenses.

(6)

Total cash and investments is defined as the sum of cash and cash equivalents, restricted cash, due from clearing brokers net of due to clearing brokers, securities and other investments owned, at fair value net of (i) securities sold not yet purchased and (ii) other investments participation sold reported in noncontrolling interest, advances against customer contracts, loans receivable, at fair value net of loan participations sold, and other equity investments reported in prepaid and other assets.

(7)

Segment operating income (loss) is defined as segment income (loss) excluding trading income (losses) and fair value adjustments on loans and other investment related expenses.

Note Regarding Use of Non-GAAP Financial Measures
Certain of the information set forth herein, including operating revenues, adjusted EBITDA, operating adjusted EBITDA, and investment adjusted EBITDA, may be considered non-GAAP financial measures. B. Riley Financial believes this information is useful to investors because it provides a basis for measuring the Company’s available capital resources, the operating performance of its business and its revenues and cash flow, (i) excluding in the case of operating revenues, trading income (losses) and fair value adjustments on loans, (ii) excluding in the case of adjusted EBITDA, net interest expense, provisions for or benefit from income taxes, depreciation, amortization, fair value adjustment, restructuring costs, gain on extinguishment of loans, impairment of trade names, stock-based compensation and transaction and other expenses, (iii) excluding in the case of operating adjusted EBITDA, the aforementioned adjustments for adjusted EBITDA as well as trading income (losses) and fair value adjustments on loans, and other investment related expenses, (iv) including in the case of investment adjusted EBITDA, trading income (losses) and fair value adjustments on loans, net of other investment related expenses, and (v) including in the case of total cash and investments, net of debt, total cash, net securities and investments, and other minus total debt, that would normally be included in the most directly comparable measures calculated and presented in accordance with Generally Accepted Accounting Principles (“GAAP”). In addition, the Company’s management uses these non-GAAP financial measures along with the most directly comparable GAAP financial measures in evaluating the Company’s operating performance, management compensation, capital resources, and cash flow. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information presented in compliance with GAAP, and non-financial measures as reported by the Company may not be comparable to similarly titled amounts reported by other companies.

Forward-Looking Statements
Statements in this press release that are not descriptions of historical facts are forward-looking statements that are based on management’s current expectations and assumptions and are subject to risks and uncertainties. If such risks or uncertainties materialize or such assumptions prove incorrect, our business, operating results, financial condition, and stock price could be materially negatively affected. You should not place undue reliance on such forward-looking statements, which are based on the information currently available to us and speak only as of the date of this press release. Such forward-looking statements include, but are not limited to, statements regarding our excitement and the expected growth of our business segments. Factors that could cause such actual results to differ materially from those contemplated or implied by such forward-looking statements include, without limitation, the risks associated with the unpredictable and ongoing impact of the COVID-19 pandemic and other risks described from time to time in B. Riley Financial, Inc.’s periodic filings with the SEC, including, without limitation, the risks described in B. Riley Financial, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2020 and in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2021 under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” (as applicable). Additional information will be set forth in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2021. These factors should be considered carefully, and readers are cautioned not to place undue reliance on such forward-looking statements. All information is current as of the date this press release is issued, and B. Riley Financial, Inc. undertakes no duty to update this information.

B. RILEY FINANCIAL, INC.

Condensed Consolidated Balance Sheets

(Dollars in thousands, except par value)





June 30,


December 31,





2021


2020





(Unaudited)




Assets

Assets:







Cash and cash equivalents

$

297,396


$

103,602


Restricted cash


1,335



1,235


Due from clearing brokers


424,949



7,089


Securities and other investments owned, at fair value


1,278,773



777,319


Securities borrowed


1,140,023



765,457


Accounts receivable, net


57,853



46,518


Due from related parties


734



986


Advances against customer contracts


200



200


Loans receivable, at fair value (includes $131,379 and $295,809 from related parties at June 30, 2021 and December 31, 2020, respectively)


270,295



390,689


Prepaid expenses and other assets


119,400



87,262


Operating lease right-of-use assets


60,933



48,799


Property and equipment, net


14,447



11,685


Goodwill


236,005



227,046


Other intangible assets, net


200,304



190,745


Deferred tax assets, net


4,080



4,098



Total assets

$

4,106,727


$

2,662,730

Liabilities and Equity

Liabilities:







Accounts payable

$

6,101


$

2,722


Accrued expenses and other liabilities


220,603



168,478


Deferred revenue


68,398



68,651


Deferred tax liabilities, net


90,325



34,248


Due to related parties and partners


230



327


Due to clearing brokers




13,672


Securities sold not yet purchased


272,088



10,105


Securities loaned


1,134,359



759,810


Mandatorily redeemable noncontrolling interests


4,105



4,700


Operating lease liabilities


73,761



60,778


Notes payable


357



37,967


Loan participations sold


4,444



17,316


Term loans, net


257,104



74,213


Senior notes payable, net


1,213,105



870,783



Total liabilities


3,344,980



2,123,770










Commitments and contingencies






B. Riley Financial, Inc. stockholders’ equity:







Preferred stock, $0.0001 par value; 1,000,000 shares authorized; 4,275 and 3,971 shares issued and outstanding as of June 30, 2021 and December 31, 2020, respectively; and liquidation preference of $106,882 and $99,260 as of June 30, 2021 and December 31, 2020, respectively





Common stock, $0.0001 par value; 100,000,000 shares authorized; 27,580,300 and 25,777,796 issued and outstanding as of June 30, 2021 and December 31, 2020, respectively


3



3


Additional paid-in capital


387,084



310,326


Retained earnings


338,260



203,080


Accumulated other comprehensive loss


(1,178)



(823)



Total B. Riley Financial, Inc. stockholders’ equity


724,169



512,586

Noncontrolling interests


37,578



26,374



Total equity


761,747



538,960




Total liabilities and equity

$

4,106,727


$

2,662,730

B. RILEY FINANCIAL, INC.

Condensed Consolidated Statements of Income

(Unaudited)

(Dollars in thousands, except share data)


















Three Months Ended


Six Months Ended




June 30,


June 30,




2021


2020


2021


2020

Revenues:













Services and fees

$

266,143


$

125,595


$

555,612


$

284,976


Trading income (losses) and fair value adjustments on loans


32,679



114,547



299,621



(67,895)


Interest income – Loans and securities lending


25,491



24,506



62,411



46,357


Sale of goods


12,457



1,820



19,285



2,824



Total revenues


336,770



266,468



936,929



266,262

Operating expenses:













Direct cost of services


12,094



7,985



23,416



27,937


Cost of goods sold


3,626



860



8,952



1,629


Selling, general and administrative expenses


199,922



106,562



391,266



194,306


Impairment of tradenames




8,500





12,500


Interest expense – Securities lending and loan participations sold


10,983



11,221



30,172



19,694



Total operating expenses


226,625



135,128



453,806



256,066



Operating income


110,145



131,340



483,123



10,196

Other income (expense):













Interest income


56



224



105



470


Gain on extinguishment of loans


6,509





6,509




(Loss) income from equity investments


(852)



(318)



23



(554)


Interest expense


(20,856)



(16,509)



(40,642)



(32,163)



Income (loss) before income taxes


95,002



114,737



449,118



(22,051)

(Provision) benefit for income taxes


(19,902)



(32,208)



(117,420)



5,331



Net income (loss)


75,100



82,529



331,698



(16,720)

Net income (loss) attributable to noncontrolling interests


(576)



(1,311)



1,366



(1,895)



Net income (loss) attributable to B. Riley Financial, Inc.

$

75,676


$

83,840


$

330,332


$

(14,825)

Preferred stock dividends


1,789



1,087



3,538



2,142



Net income (loss) available to common shareholders

$

73,887


$

82,753


$

326,794


$

(16,967)















Basic income (loss) per common share 

$

2.70


$

3.23


$

12.03


$

(0.66)

Diluted income (loss) per common share 

$

2.58


$

3.07


$

11.39


$

(0.66)















Weighted average basic common shares outstanding


27,344,184



25,627,085



27,159,257



25,827,849

Weighted average diluted common shares outstanding


28,668,465



26,992,823



28,690,444



25,827,849

B. RILEY FINANCIAL, INC.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(Dollars in thousands)
















Six Months Ended June 30,






2021


2020

Cash flows from operating activities:





Net income (loss) 

$

331,698


$

(16,720)


Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities:








Depreciation and amortization


12,924



9,879



Provision for doubtful accounts


755



2,081



Share-based compensation


14,134



9,489



Fair value adjustments, non-cash


(10,046)



21,975



Non-cash interest and other


(9,091)



(6,943)



Effect of foreign currency on operations


(1,486)



(73)



(Income) loss from equity investments


(23)



554



Dividends from equity investments


610



797



Deferred income taxes


51,242



(14,340)



Impairment of intangibles and gain on disposal of fixed assets




12,550



Gain on extinguishment of loans


(6,509)





Loss (gain) on extinguishment of debt


919



(1,556)



Gain on equity investment


(3,544)





Income allocated for mandatorily redeemable noncontrolling interests


347



397



Change in operating assets and liabilities:









Due from clearing brokers


(424,062)



(5,271)




Securities and other investments owned


(316,181)



20,009




Securities borrowed


(374,565)



27,967




Accounts receivable and advances against customer contracts


808



27,601




Prepaid expenses and other assets


(25,870)



(19,707)




Accounts payable, accrued expenses and other liabilities


(22,983)



738




Amounts due to/from related parties and partners


155



4,404




Securities sold, not yet purchased


261,476



(32,017)




Deferred revenue


(3,158)



3,896




Securities loaned


374,549



(31,481)





Net cash (used in) provided by operating activities


(147,901)



14,229

Cash flows from investing activities:







Purchases of loans receivable


(87,309)



(152,228)


Repayments of loans receivable


95,522



74,450


Sale of loan receivable to related party




1,800


Proceeds from loan participations sold




2,400


Repayment of loan participations sold


(10,772)



(940)


Acquisition of business, net of $34,924 cash acquired


(390)



(1,500)


Purchases of property, equipment and other


(288)



(851)


Proceeds from sale of property, equipment and intangible assets




1


Purchase of equity investments


(10,485)



(6,486)





Net cash used in investing activities


(13,722)



(83,354)

Cash flows from financing activities:







Repayment of asset based credit facility




(37,096)


Repayment of notes payable 


(37,610)



(357)


Repayment of term loan


(11,484)



(9,620)


Proceeds from term loan


200,000




Proceeds from issuance of senior notes


475,698



171,078


Redemption of senior notes


(128,156)



(1,829)


Payment of debt issuance costs


(15,661)



(2,760)


Payment for contingent consideration


(411)




Payment of employment taxes on vesting of restricted stock


(10,370)



(2,678)


Common dividends paid


(181,269)



(17,489)


Preferred dividends paid


(3,538)



(2,142)


Repurchase of common stock




(27,779)


Distribution to noncontrolling interests


(14,792)



(2,143)


Contribution from noncontrolling interests


10,650




Proceeds from issuance of common stock


64,713




Proceeds from issuance of preferred stock


8,281



4,630





Net cash provided by financing activities


356,051



71,815





Increase in cash, cash equivalents and restricted cash


194,428



2,690





Effect of foreign currency on cash, cash equivalents and restricted cash


(534)



(705)





Net increase in cash, cash equivalents and restricted cash


193,894



1,985

Cash, cash equivalents and restricted cash, beginning of period


104,837



104,739

Cash, cash equivalents and restricted cash, end of period

$

298,731


$

106,724











Supplemental disclosures:







Interest paid

$

66,359


$

45,934


Taxes paid 

$

63,987


$

608

B. RILEY FINANCIAL, INC.

Segment Financial Information

(Unaudited)

(Dollars in thousands)





Three Months Ended


Six Months Ended




June 30,


June 30,




2021


2020


2021


2020

Capital Markets segment:













Revenues – Services and fees

$

125,997


$

60,364


$

296,976


$

133,964


Trading income (losses) and fair value adjustments on loans


29,897



114,080



294,400



(67,935)


Interest income – Loans and securities lending


25,491



24,506



62,411



46,357



Total revenues


181,385



198,950



653,787



112,386


Selling, general and administrative expenses


(65,473)



(56,623)



(151,613)



(84,924)


Interest expense – Securities lending and loan participations sold


(10,983)



(11,221)



(30,172)



(19,694)


Depreciation and amortization


(247)



(595)



(1,012)



(1,191)



Segment income


104,682



130,511



470,990



6,577

Wealth Management segment:













Revenues – Services and fees


87,444



15,318



152,986



34,205


Trading income and fair value adjustments on loans


2,865



467



5,221



40



Total revenues


90,309



15,785



158,207



34,245


Selling, general and administrative expenses


(88,702)



(15,283)



(150,174)



(32,831)


Depreciation and amortization


(2,340)



(470)



(4,739)



(953)



Segment (loss) income


(733)



32



3,294



461

Auction and Liquidation segment:













Revenues – Services and fees


5,534



7,206



12,892



27,867


Revenues – Sale of goods


11,743



1,045



17,835



1,045



Total revenues


17,277



8,251



30,727



28,912


Direct cost of services


(7,540)



(3,217)



(14,120)



(18,033)


Cost of goods sold


(3,105)



(285)



(7,579)



(314)


Selling, general and administrative expenses


(3,077)



(2,729)



(4,566)



(4,255)


Depreciation and amortization








(1)



Segment income


3,555



2,020



4,462



6,309

Financial Consulting segment:













Revenues – Services and fees


23,735



18,845



45,144



39,559


Selling, general and administrative expenses


(19,471)



(15,268)



(37,460)



(30,997)


Depreciation and amortization


(89)



(73)



(187)



(140)



Segment income


4,175



3,504



7,497



8,422

Principal Investments – United Online and magicJack segment:













Revenues – Services and fees


18,932



20,656



38,725



42,374


Revenues – Sale of goods


714



775



1,450



1,779



Total revenues


19,646



21,431



40,175



44,153


Direct cost of services


(4,554)



(4,768)



(9,296)



(9,904)


Cost of goods sold


(521)



(575)



(1,373)



(1,315)


Selling, general and administrative expenses


(4,768)



(4,049)



(9,638)



(9,512)


Depreciation and amortization


(2,528)



(2,851)



(5,062)



(5,730)



Segment income


7,275



9,188



14,806



17,692

Brands segment:













Revenues – Services and fees


4,501



3,206



8,889



7,007


Trading losses and fair value adjustments on loans


(83)









Total revenues


4,418



3,206



8,889



7,007


Selling, general and administrative expenses


(690)



(309)



(1,366)



(1,213)


Depreciation and amortization


(715)



(715)



(1,429)



(1,429)


Impairment of tradenames




(8,500)





(12,500)



Segment income (loss)


3,013



(6,318)



6,094



(8,135)

Consolidated operating income from reportable segments


121,967



138,937



507,143



31,326















Corporate and other expenses 


(11,822)



(7,597)



(24,020)



(21,130)

Interest income


56



224



105



470

Gain on extinguishment of loans


6,509





6,509



(Loss) income on equity investments


(852)



(318)



23



(554)

Interest expense


(20,856)



(16,509)



(40,642)



(32,163)


Income (loss) before income taxes


95,002



114,737



449,118



(22,051)

(Provision) benefit for income taxes


(19,902)



(32,208)



(117,420)



5,331


Net income (loss) 


75,100



82,529



331,698



(16,720)

Net (loss) income attributable to noncontrolling interests


(576)



(1,311)



1,366



(1,895)


Net income (loss) attributable to B. Riley Financial, Inc.


75,676



83,840



330,332



(14,825)

Preferred stock dividends


1,789



1,087



3,538



2,142


Net income (loss) available to common shareholders

$

73,887


$

82,753


$

326,794


$

(16,967)

B. RILEY FINANCIAL, INC.

Adjusted EBITDA and Operating Adjusted EBITDA Reconciliation

(Unaudited)

(Dollars in thousands)




















Three Months Ended


Six Months Ended





June 30,


June 30,





2021


2020


2021


2020

Net income (loss) attributable to B. Riley Financial, Inc.

$

75,676


$

83,840


$

330,332


$

(14,825)

Adjustments:













Provision (benefit) for income taxes


19,902



32,208



117,420



(5,331)


Interest expense


20,856



16,509



40,642



32,163


Interest income


(56)



(224)



(105)



(470)


Share based payments


8,608



4,168



14,134



9,489


Depreciation and amortization


6,165



4,923



12,924



9,879


Gain on extinguishment of loans


(6,509)





(6,509)




Impairment of tradenames




8,500





12,500


Transactions related costs and other


245



(1,660)



1,530



8,794


















Total EBITDA adjustments


49,211



64,424



180,036



67,024



















Adjusted EBITDA

$

124,887


$

148,264



510,368



52,199

Operating EBITDA Adjustments:













Trading (income) losses and fair value adjustments on loans


(32,679)



(114,547)



(299,621)



67,895


Other investment related expenses


(84)



13,040



4,094



(2,430)


















Total Operating EBITDA Adjustments


(32,763)



(101,507)



(295,527)



65,465



















Operating Adjusted EBITDA

$

92,124


$

46,757


$

214,841


$

117,664

B. RILEY FINANCIAL, INC.

Adjusted Net Income Reconciliation

(Unaudited)

(Dollars in thousands, except share data)
















Three Months Ended
June 30,


Six Months Ended
June 30,



2021


2020


2021


2020

Net income (loss) attributable to B. Riley Financial, Inc.

$

75,676


$

83,840


$

330,332


$

(14,825)

Adjustments:













Share based payments


8,608



4,168



14,134



9,489


Amortization of intangible assets


5,134



4,024



11,020



8,048


Gain on extinguishment of loans


(6,509)





(6,509)




Impairment of tradenames




8,500





12,500


Transactions related costs and other


245



(1,660)



1,530



8,794


Income tax effect of adjusting entries


(1,557)



(4,172)



(5,073)



(10,731)

Adjusted net income attributable to B. Riley Financial, Inc.

$

81,597


$

94,700


$

345,434


$

13,275














Adjusted income per common share:













Adjusted basic income per share 

$

2.98


$

3.70


$

12.72


$

0.51


Adjusted diluted income per share 

$

2.85


$

3.51


$

12.04


$

0.51














Shares used to calculate adjusted basic net income per share


27,344,184



25,627,085



27,159,257



25,827,849

Shares used to calculate adjusted diluted net income per share


28,668,465



26,992,823



28,690,444



25,827,849

SOURCE B. Riley Financial

Related Links

www.brileyfin.com

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