(Reuters) – LPL Financial, a network of independent brokers preparing for an initial public offering, said its brokerage force shrank in the second quarter and profit fell by half.
LPL, the largest independent U.S. broker-dealer, had a network of 12,066 affiliated representatives and advisers at the end of the quarter, down 423, or 3.4 percent, from a year earlier, the company said in a regulatory filing.
Quarterly net income dropped 49 percent to $8 million, reflecting $23 million of expenses for redeeming senior debt and $2.8 million of charges from adding three firms to its self-clearing platform last September.
The integration of the three firms — Mutual Service Corp, Associated Securities Corp and Waterstone Financial Group — led to 720 broker departures, LPL said. Excluding those departures, it added a net 297 new advisers during the past year.
Second-quarter net revenue rose 18 percent to $790 million, driven by 6.9 percent growth in assets to $277 billion and more productive brokers.
Advisory assets rose 21 percent to $79 billion as of June 30.
LPL is controlled by investment firms Hellman & Friedman and TPG Group. The company in June filed for a $600 million IPO on the Nasdaq under the symbol “LPLA.” No date for the IPO has been named. (Reporting by Joseph A. Giannone; editing by John Wallace)