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Advest Group Inc (Nyse: adv)
Advest Group Inc. (NYSE: ADV)
90 State House Square
Hartford 06103
Chairman and CEO: Allen Weintraub
Revenues (YE Sept. 30, 1998):
$325.2 million
Earnings (YE Sept. 30, 1998):
$18.0 million
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Business New Haven
1/11/1999
By: BNH
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Advest and its predecessor companies have seen a century of holiday seasons, and 1998 brought that century to a close with the company's 100th anniversary.
In 1898 in Boston, young entrepreneurs with a knowledge of the newfound phenomenon known as electricity established an investment banking firm, named Perry Coffin & Burr, dedicated to assisting electric utilities with financing. Over the ensuing decades several other investment firms came into being which would eventually become a part of Advest. Among then were Newburger, Henderson & Loeb of Philadelphia (founded in 1899), Sartorius & Co. of New York (1899), Richter & Co. of Hartford (1905), Doolittle & Co. of Buffalo (1917) and Vercoe & Co. of Columbus (1922).
The company's Hartford heritage strengthened when William H. Putnam, a Richter & Co. partner since 1912, gained control of the company by guaranteeing its financial obligations in the wake of the 1921 recession. The company's name was changed to Putnam & Co., and William Putnam continued as a leading citizen and businessman of Hartford. In the following decades the company survived depression and wars and enjoyed recoveries and decades of New Year's celebrations.
In the 1960s Putnam & Co. embarked on a plan of expansion beginning with its merger with Boston's Coffin & Burr in 1964. Three years later Doolittle & Co. was acquired by Putnam, Coffin & Burr and the newly named Advest Co. became the parent. Both Putnam, Coffin & Burr and Doolittle & Co. operated as Advest Co. divisions.
The following decade saw the mergers of Newburger & Co., in 1970 and Sartorius & Co. in 1974 into the Advest fold. By 1977 it was auld lang syne for the various division names, which were dropped and replaced with the name Advest Inc. In that year the Advest Group Inc. became the parent and the acquisition activity continued with the purchase of Hartford's Billings & Co. Inc.
The 1980s rang in with Advest Group's initial public offering of 600,000 shares, offered at $10.75. Throughout the decade the company extended its market reach with acquisitions in Maryland, Washington, D.C., New York, Rhode Island, Virginia and Ohio.
The decade also witnessed Advest's opening of Advest Bank, a Connecticut-chartered savings and loan. (In 1997 the charter was changed to a federal savings bank and the name changed to Advest Bank & Trust Co.).
New Year's celebrations in the latter part of the decade turned more somber with the witnessing of such events as the drastic decline of the stock market in 1987, a deep recession in real estate and severe troubles with lending institutions. These events ultimately affected Advest's banking operations.
1990 was no cause for celebration as Advest's stock price hit bottom at $1.75 and the company recorded a net loss of $9 million. By 1992 the company recorded its third net loss in as many years. However, under the guidance of its present CEO, Allen Weintraub, the company was turned around and by the mid-1990s Advest was again in a celebratory mood.
Thus we come to the Advest of the centennial year. The company today provides financial services including brokerage, investment banking, lending, asset management and trust services. Its two operating units, Advest Inc. and Advest Bank & Trust Co., service a market including 16 states and the District of Columbia.
Its anniversary year was a time for confetti and cheers with year-end September 30, 1998 reported net income, revenues and earnings per-share at record levels. Total revenues of $325.2 million reflected a 12-percent increase over the prior year. Net income of $18.0 million, or $1.92 earnings per share on a diluted basis, represented a 20-percent increase over the prior year of $14.9 million, or $1.62 per share.
Even with the stock-market volatility of the summer and fall months of 1998, Advest's fourth quarter ending September 30 marked an eight percent increase in net income of $5.0 million (54 cents earnings per share diluted) compared to $4.7 million (51 cents per share) for fourth quarter 1997. Revenues increased four percent to $82.0 million versus 1997 fourth quarter revenues of $79.0 million. Included in the 1998 fourth quarter results was a payoff of a non-performing loan that resulted in an increase of net income of $1.4 million, or 15 cents per share.
In other news, on October 15 the company paid a four cents-per-share quarterly dividend for holders of record on September 30. Advest has been involved in a stock repurchase program by which it has repurchased more than 2.7 million, or 26 percent, of outstanding shares. As of September 30 the company had 8.9 million outstanding shares. The stock closed at 18 11/16 on December 24, but has been trading well below its 52-week high in the 33 range.
1999 will see its current chairman and CEO, Allen Weintraub, step down from his CEO position effective April 1 to be succeeded by the current president, Grant Kurtz. Weintraub will continue as chairman. Advest's performance of recent years has been cause for celebration, a culmination of a century's work - a fitting way to bring in the new year and commence a new century of memorable performance.
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