Piper Jaffray’s second quarter net income shrank 64% to US$2.5 million from US$6.9 million in the year-ago period, due to weak performance by its brokerage unit.
For the quarter ended 30 June 2013, net revenues declined 3% to US$99.72 million from US$103.10 million in the year-ago period.
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Piper Jaffray has two reportable business segments – capital markets and asset management.
For the quarter, capital markets division generated a pre-tax operating loss of US$2.1 million, compared to pre-tax operating income of US$1.8 million in the second quarter of 2012.
The division’s revenue declined 7% to US$81.8 million, as strong growth in equity financing revenues were more than offset by lower advisory services revenue and fixed income institutional brokerage revenues.
Revenues at asset management divisions grew 16% to US$18 million, driven by higher management fees from increased assets under management or AUM due to market appreciation.
The division generated pre-tax operating income of US$5.5 million, up 41% compared to the second quarter of 2012. AUM rose to US$10.2 billion in the quarter from US$8.5 billion in the year-ago period.
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By GlobalData"We experienced extremely challenging conditions in the fixed income markets this quarter which adversely impacted our fixed income brokerage business and our results for the quarter," Andrew Duff, chief executive of the company said. "Outside of that business, most of our businesses performed well this quarter."
