AMERICAN brokerage Charles Schwab’s first-quarter earnings rose six per cent compared to last year but fell short of analysts’ expectations yesterday, as client trading activity remained lukewarm and one-time expenses increased.
The San Francisco-based retail broker said net income climbed to $206m (£134m) for the first quarter of 2013, from $195m a year earlier.
The corporation, which is one of the world’s largest discount brokers, also announced that revenue was up by eight per cent to $1.29bn, helped by a three per cent rise in brokerage accounts to 8.9m while asset management and admin fees rose 14 per cent to $552m.
However, Schwab’s pre-tax profit margin was down 0.6 per cent to 25.7 per cent during the year.
Total expenses rose 9.4 per cent to $959m, in part due to an uptick in staff pay.
Chief financial officer Joe Martinetto said the firm was managing staffing levels and cutting spending on projects and marketing to keep a lid on costs.
“Our earnings picture for 2013 hasn’t changed – the temporary and seasonal factors elevating our first quarter compensation and benefits expense will fade and we are taking action to address the evolving revenue outlook for the year,” he said in a statement.
“Right now, that outlook includes balance and spread-related revenues that are mostly in line with our expectations and trading activity that remains more muted than planned.”