Reuters: Private Equity: UPDATE 2-LPL Investment to begin paying qtly dividend

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UPDATE 2-LPL Investment to begin paying qtly dividend Apr 30th 2012, 13:28 Mon Apr 30, 2012 9:28am EDT * To pay quarterly dividend of up to 12 cents a share * Declares special dividend of $2 a share * Shareholders Hellman & Friedman, TPG Capital to sell 14.5 mln shares * Q1 adjusted EPS 56 cents vs Street view 54 cents April 30 (Reuters) - LPL Investment Holdings Inc, t he largest U .S. independent brokerage, said i ts private-equity backers would sell about $540 million of stock in a public offering, and the firm detailed plans for a special dividend and regular quarterly dividends starting in the second half. The Boston company, a beneficiary of the movement by investors and brokers toward independent firms, also reported better-than-expected quarterly earnings, fueled by recruiting and improving markets. LPL Chief Executive Mark Casady said the movement of advisers from traditional firms to independents was increasing. "The pipeline is strong," Casady said in a conference call. "C urrent conditions have resulted in us elevating our expectations for new adviser additions and related expense in the coming quarters." LPL added 115 net new advisers during the first quarter. Excluding 146 advisers who left after a merger integration last year, LPL has added 554 advisers in the past 12 months, Casady said. LPL ended March with 12,962 advisers, up 3.2 percent from a year earlier. The firm's low capital needs and rising revenue have led to a growing cash pile. L PL declared a special dividend of $2 a share LPL also said it would pay regular quarterly dividends, initially up to 12 cents a share, beginning in the second half. Sh ares of LPL closed Friday at $36.98 on the Nasdaq, up 21 percent this year. LPL said its two largest shareholders, private-equity investors Hellman & Friedman and TPG Capital, would sell 14.5 million shares in a secondary offering. Based on the stock's Friday closing price, those shares are worth about $540 million. UBS brokerage analyst Alex Kramm said LPL's first-quarter revenue beat expectations thanks to higher commissions, but he warned the stock sale could weigh on the stock price in the near term. LPL sells technology, clearing and other services to self-employed brokers, w ho retain the lion's share of the fees and commissions they generate. The brokers pay their own overhead expenses. For the first quarter, LPL posted a profit of $41.2 million or 37 cents a share, down from $49.0 million, or 43 cents a share, a year ago, primarily due to charges related to debt refinancing. Excluding certain non-cash charges, the company earned 56 cents a share, topping analysts' average estimates of 54 cents, according to Thomson Reuters I/B/E/S. Revenue rose about 3 percent to a record $901.3 million. Analysts had expected $890.5 million. Advisory assets in LPL's fee-based platforms, which generate income regardless of investor trading activity, rose 11 percent to $110.8 billion. Total advisory and brokerage assets were up 7.3 percent to $354.1 billion. Link this Share this Digg this Email Reprints

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