Safeguard Scientifics (SFE) Tops Q3 EPS by 42c

Safeguard Scientifics (NYSE: SFE) reported Q3 EPS of ($0.12), $0.42 better than the analyst estimate of ($0.54).

"This dividend demonstrates our commitment to return value to our shareholders. And, we remain committed to continuing to reward our shareholders by maximizing the overall value of our partner company holdings and by returning that value to our shareholders as quickly and tax efficiently as possible," said Brian J. Sisko, Safeguard's President and CEO. "Since we announced our strategy, we have realized over $184 million in cash proceeds related to monetizations of our partner company interests. To date we have used those proceeds to continue to support our partner companies; to operate the business; and to retire all of our debt. We are now able to start returning value to our shareholders. At this time, our Board of Directors has determined that the most appropriate first step in this stage of the execution of our strategy is to issue a dividend. We anticipate the dividend to be characterized as a return of capital for Federal tax purposes. Whenever we have cash and cash equivalents on our balance sheet that exceeds what we believe is prudent to keep on hand to operate the business and continue to support our partner companies, our Board of Directors will authorize share repurchases and/or additional dividends. Currently, we believe $25 million is the appropriate amount to retain on our balance sheet."

OUTLOOK

Mark A. Herndon, Safeguard\'s Senior Vice President and Chief Financial Officer, went on to say, "We continue to be encouraged by the performance of our portfolio, and continue to be optimistic about the overall health of our partner companies. There were no impairments during the quarter. Excluding our digital media companies, Safeguard's portfolio of partner companies is growing revenue more than 50% in aggregate. Corporate expenses for the year ended December 31, 2019 are forecasted to be at or below $8.0 million, including incremental accruals for the previously established transaction bonus plan, a substantial decline from 2018. Follow-on funding requirements for the full year are forecasted to be approximately the same as in 2018. We expect that follow-on funding requirements will decline significantly in 2020."

For earnings history and earnings-related data on Safeguard Scientifics (SFE) click here.

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