LOS ANGELES - B. Riley Financial, Inc. (NASDAQ: RILY) experienced a sharp decline in its stock price, tumbling around 18%, in after market hours, as the diversified financial services platform reported a significant loss for the fourth quarter ended December 31, 2023. The company announced a net loss available to common shareholders of $70 million, or a diluted loss per share of $2.32. This compares unfavorably to the prior year's fourth quarter, where the net loss was $59.4 million, or $2.08 per diluted share. Total revenues for the quarter were $347 million, a decrease from $382 million reported in the same quarter last year.
The decline in stock price reflects investor reaction to the reported losses and a decrease in total revenues. Operating revenues for the quarter were $395 million compared to $449 million in the fourth quarter of 2022, while operating adjusted EBITDA was $79 million, down from $110 million in the previous year. For the full year, total revenues increased by 52% to $1.65 billion, up from $1.08 billion in 2022. However, the net loss for the year was $86 million, primarily driven by non-cash impairment charges and unrealized investment losses.
Bryant Riley, Chairman and Co-Chief Executive Officer, commented on the company's performance, stating that despite the losses, the company has made notable progress across its subsidiaries. He highlighted that non-cash investment losses and an impairment charge masked what was otherwise a strong year for their core businesses. The financial consulting revenues and operating income grew significantly, and the wealth management business returned to profitability.
The company also announced a quarterly dividend of $0.50 per common share payable on March 22, 2024, to shareholders of record as of March 11, 2024. Additionally, B. Riley Financial has retained Moelis (NYSE:MC) & Company as an independent financial advisor to commence a review of strategic alternatives for its appraisal and asset disposition businesses.
In terms of segment performance, the Capital Markets segment saw a 75% increase in revenues to $575 million in 2023, up from $328 million in 2022. The Wealth Management segment returned to profitability with revenues of $198 million for the year. Auction and Liquidation revenues grew 39% to $103 million, driven by retail liquidation activity. The Financial Consulting segment also reported strong growth, with revenues increasing 36% to $134 million.
The company is currently finalizing its financial statements and will file a Form 12b-25 with the SEC to provide notice of the late filing of its Annual Report on Form 10-K for the year ended December 31, 2023. The delay is attributed to the dedication of time and resources related to the review by the Audit Committee of the company's transactions with Brian Kahn.
Investors will be closely monitoring B. Riley Financial's future performance as it navigates the challenges that led to the fourth quarter's results and the strategic review of its businesses.
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