Press release·02/27/2025 22:28:06

Overview of Oppenheimer Holdings Inc.

Oppenheimer Holdings Inc. is a leading middle market investment bank and full-service broker-dealer engaged in a wide range of securities industry activities. The company’s principal subsidiaries are Oppenheimer & Co. Inc. and Oppenheimer Asset Management Inc. As of December 31, 2024, Oppenheimer provided services from 88 offices in 25 states across the United States, as well as locations in Puerto Rico, Israel, China, England, Jersey, and Switzerland. The company has 3,018 employees, including 931 financial advisors.

Financial Performance Highlights

Oppenheimer reported strong financial results for the year ended December 31, 2024, with record high revenue of $1.43 billion, up 14.7% from the prior year. This was driven by significant increases across multiple business segments:

• Commissions revenue increased 17.3% to $409.7 million due to higher overall client activity.
• Advisory fees grew 16.3% to $483.4 million, reflecting record billable assets under management (AUM).
• Investment banking revenue surged 50.0% to $176.4 million on higher transaction and new issuance volumes.

However, these positive trends were partially offset by a 19.7% decline in bank deposit sweep income to $138.8 million, due to lower cash sweep balances and interest rates.

On the expense side, compensation and related costs increased 19.7% to $936.8 million, primarily due to higher salaries, production-related expenses, incentive compensation, and costs associated with Oppenheimer stock appreciation rights. Non-compensation expenses decreased 7.1% to $389.9 million, largely due to lower legal and regulatory costs.

Overall, Oppenheimer’s pre-tax income for 2024 was $105.8 million, up 126.1% from the prior year. Net income attributable to the company was $71.6 million, a 137.1% increase.

Segment Performance

Oppenheimer’s business is organized into three segments: Wealth Management, Capital Markets, and Corporate/Other.

Wealth Management The Wealth Management segment reported revenue of $972.1 million in 2024, up 9.2% from 2023. Pre-tax income increased 21.6% to $265.7 million. Key drivers included:

• Retail commissions up 18.8% due to higher client activity
• Advisory fees up 16.4% on record billable AUM of $49.4 billion
• Interest revenue up 4.2% from higher margin loan balances
• Partially offset by a 19.7% decline in bank deposit sweep income

Capital Markets The Capital Markets segment generated revenue of $447.6 million, a 29.4% increase from the prior year. However, the segment reported a pre-tax loss of $39.6 million, an improvement from a $63.0 million loss in 2023. Highlights included:

• Investment banking revenue up 49.3%, with strong growth in advisory, equities underwriting, and fixed income underwriting fees
• Equities and fixed income sales and trading revenue up 19.6% on higher volumes and market share

Outlook and Strategic Priorities

Oppenheimer remains focused on several key strategic priorities:

1. Growing the wealth management business through recruiting experienced financial advisors and expanding asset management capabilities.
2. Pursuing opportunities in capital markets, including integrating new technology platforms and onboarding experienced personnel to attract more institutional clients.
3. Expanding the investment banking footprint by adding experienced bankers in existing and new industry practices.
4. Continuously investing in technology to support client service and remain competitive, while managing expenses.
5. Evaluating potential acquisition opportunities that align with the company’s strategic goals.

The company is optimistic about its future prospects, having ended 2024 with record revenues, AUM, stockholders’ equity, and book value per share, as well as a significantly de-levered balance sheet.

Key Risks and Uncertainties

Oppenheimer’s business activities expose the company to significant market, credit, and other risks. Key risk factors include:

• Volatility in securities markets and interest rates
• Changes in regulatory requirements
• General economic conditions, including inflation and recession
• Competition from existing and new participants in the securities industry
• Potential cybersecurity threats
• Legal and regulatory proceedings
• Geopolitical risks, such as the ongoing Israel-Hamas conflict and tensions with Iran
• Risks related to the use of artificial intelligence and other emerging technologies

The company continuously reviews its risk management practices and invests in people and programs to ensure compliance with industry regulations and support client service and business expansion.

Conclusion

Oppenheimer Holdings Inc. delivered strong financial results in 2024, driven by growth across its Wealth Management and Capital Markets segments. The company remains focused on strategic priorities to expand its wealth management business, capitalize on opportunities in capital markets, and pursue selective acquisitions. While the company faces various risks, it is well-positioned to continue serving its clients and delivering value to shareholders.