Goldman Sachs Record Revenues, Compensation

Trupti Mehta
14 Jul, 2009
New York City

Goldman Sachs reported second quarter revenues surged 46% to $113.76 billion and net earnings soared 89% to $3.45 billion. The corporations around the world took opportunity to raise capital in stocks and debt offering lifting underwriting revenues in the quarter.

[R]10:00 AM New York – Goldman Sachs reported second quarter revenues surged 46% to $113.76 billion and net earnings soared 89% to $3.45 billion. The corporations around the world took opportunity to raise capital in stocks and debt offering lifting underwriting revenues in the quarter. Record trading in stocks, bonds and commodities also contributed to earnings.[/R]

The Goldman Sachs reported second quarter revenues surged 46% to $13.76 billion and net earnings surged 89% to $3.45 billion. The earnings, after adjusting for TARP preferred stock dividends of $717 million increased 64% to $2.7 billion.

Diluted earnings per share in the quarter increased 45% to $4.93 compared to $3.39 a share.

Goldman Sachs ((GS)) declined 57 cents to $148.75 after surging from its low $59 on January 20.

Annualized return on common equity was 23% in the second quarter and 18.3% in the first half.

The increase in offering from companies around the world lifted the underwriting revenues in the quarter to the record. Equity underwriting fees surged to $736 million but net revenues in investment banking declined 15% from a year ago to $.44 billion, or a surge of 75% from the first quarter a year ago.

Net revenues in trading and principal investments, that includes fixed income, currency and commodities surged 93% to $10.78 billion.

Fixed income, currency and commodities segment reported record quarterly revenues of $6.8 billion and trading in equities generated record quarterly revenues of $3.18 billion.

Revenues in asset management and securities services declined 28% to $1.54 billion. In the quarter net asset under management increased $48 billion of which $42 billion were due to market appreciation and $6 billion from net inflows.

Compensation and benefits in the quarter increased to $6.65 billion and ratio of compensation to the revenues increase to 49% on 1% lower staff in the quarter.

Effective tax rate in the quarter increased to 31.5% from 31% and average global core excess liquidity increased to $170.95 billion from $163.74 billion.

Book value per share increased 8% to $106.41 and tangible book value per common share increased 10% to $96.94.

The board of directors declared dividend of 35 cents a common share and $236.98 per preferred A share. In addition, $2,500 of dividend will be paid to preferred G shareholders.