Hudson Holding Corporation Announces Year End Results

JERSEY CITY, N.J., June 26 /PRNewswire-FirstCall/ -- Hudson Holding Corporation (OTC Bulletin Board: HDHL.OB) announced that it filed its results for the year ended March 31, 2009 with the Securities and Exchange Commission today.

"We're pleased with the steady annual revenue growth that Hudson achieved despite a disappointing fourth quarter, which saw a decline in revenues, due to overall market conditions," said Marty Cunningham, Hudson's Chairman and Chief Executive Officer. "While the market environment is difficult," Mr. Cunningham continued "we're fortunate to be seeing more opportunities to add seasoned producers and/or complementary business lines. Our loss is largely driven by recruitment and retention costs due to expansion."

                                                         Years Ended
                                                          March 31,
                                                    2009             2008
    Sales and trading                          $ 23,285,148     $ 15,541,702
    Commissions and fees                         13,735,660       10,070,068
    Interest and other income                       951,703        1,157,073
    Total revenues                             $ 37,972,511     $ 26,768,843

    Net loss                                   $ (3,611,999)    $ (1,602,290)
    Basic and diluted EPS                      $      (0.08)    $      (0.04)

Total revenues increased 42% for the year ended March 31, 2009, to approximately $38 million from $26.8 million during the same period in the prior fiscal year. Sales and trading revenues increased to approximately $23.3 million from approximately $15.5 million during the prior fiscal year, due to the addition of sales traders and a significant customer which comprised 18% of total revenues during fiscal 2009. Commissions and fee revenues increased to $13.7 million from $10.1 million during the prior fiscal year, due to an expansion of our institutional sales effort. Interest and other income decreased to $1.0 million from $1.2 million during fiscal 2009, primarily due to a decrease in introductory brokerage services revenues.

The pre-tax loss was $4.3 million as compared to a $2.6 million pre-tax loss during the prior year, as expenses increased by $12.9 million, primarily as a result of a $7.8 million increase in variable costs (commissions, execution, and clearing costs) and a $3.3 million increase in salaries and related costs, due to an increase in recruitment and retention costs. Recruitment and retention costs (stock-based compensation and other recruiting incentives) increased to approximately $3.7 million during fiscal 2009, from $1.0 million during the prior fiscal year, primarily due to costs associated with hiring additional sales traders. Income taxes were a benefit of $0.7 million as compared to a benefit of $1.0 million during the prior year, which included a current year increase in the deferred tax valuation allowance. The net loss increased to approximately $3.6 million during fiscal 2009, from net loss of $1.6 million during the prior fiscal year.

                                       March 31,      March 31,
                                         2009           2008
    Hudson Holding Corporation
    Stockholders' equity              $13,637,690    $12,075,398
    Total assets                      $17,106,940    $17,323,538

    Hudson Securities, Inc.
    Net capital                        $6,109,286     $4,870,737
    Excess net capital                 $5,109,286     $3,870,737

Hudson Holding Corporation is a publicly traded company on the OTC Bulletin Board under the symbol "HDHL" and is the parent of Hudson Securities, Inc. and Hudson Technologies, Inc. Hudson Securities, Inc. is dedicated to meeting the liquidity needs of its clients -- institutions, hedge funds, asset managers, and broker dealers -- by providing execution solutions and making markets in over 15,000 U.S. and foreign securities and ADRs. As a registered broker-dealer under the Securities Exchange Act of 1934, Hudson Securities is a member of the Financial Industry Regulatory Authority ("FINRA") and has been in business since 1984. Hudson Technologies provides technology services to Hudson Securities and client companies.

Certain statements contained herein constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current expectations, estimates and projections about the Company's industry, management's beliefs and certain assumptions made by management. Readers are cautioned that any such forward-looking statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict. Because such statements involve risks and uncertainties, the actual results and performance of the Company may differ materially from the results expressed or implied by such forward-looking statements. Given these uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. Unless otherwise required by law, the Company also disclaims any obligation to update its view of any such risks or uncertainties or to announce publicly the result of any revisions to the forward-looking statements made here; however, readers should review carefully reports or documents the Company files periodically with the Securities and Exchange Commission.

                       HUDSON HOLDING CORPORATION AND SUBSIDIARIES
                           CONSOLIDATED STATEMENTS OF OPERATIONS

                                                       For the Years Ended
                                                             March 31,
                                                         2009         2008
     Revenues:
       Sales and trading                             $23,285,148  $15,541,702
       Commissions and fees                           13,735,660   10,070,068
       Net interest and other income                     951,703    1,157,073
                                                      37,972,511   26,768,843

     Expenses:
       Salaries and related costs                      8,590,451    5,266,839
       Commissions, execution and clearing charges    22,598,246   14,781,058
       Communications                                  5,820,328    5,012,413
       Occupancy                                       1,200,317    1,388,005
       Professional fees                               1,696,264    1,063,603
       Business development                              845,623      773,788
       Other                                           1,496,319    1,055,706
                                                      42,247,548   29,341,412

     Loss before income tax benefit                   (4,275,037)  (2,572,569)
     Income tax benefit                                 (663,038)    (970,279)
     Net loss                                        $(3,611,999) $(1,602,290)

     Loss per share - basic and diluted                   $(0.08)      $(0.04)

     Weighted average number of shares outstanding
      - basic and diluted                             43,939,810   36,725,185

                    HUDSON HOLDING CORPORATION AND SUBSIDIARIES
                   CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

                                                          As of March 31,
                                                       2009            2008
    ASSETS
          Cash and cash equivalents              $  6,694,914    $  6,172,348
          Cash - restricted                           252,408         245,505
          Receivable from clearing brokers          1,294,689       2,475,575
          Securities owned, at fair value           2,246,488       2,423,257
          Income taxes receivable                      75,040         419,041
          Furniture, equipment, capitalized
           software and leasehold improvements, net 1,182,028         959,733
          Deferred tax assets                       1,515,000         705,000
          Prepaid expenses and other assets           866,027         409,289
          Prepaid compensation, net                 1,869,167       2,402,611
          Goodwill                                  1,111,179       1,111,179
                                                  $17,106,940     $17,323,538

    LIABILITIES AND STOCKHOLDERS' EQUITY

        Liabilities:

          Accounts payable, accrued expenses
           and other liabilities                 $  1,461,774    $  1,374,548
          Commissions payable                       1,259,987       1,070,511
          Securities sold, but not yet purchased,
           at fair value                              637,829       2,778,081
          Income taxes payable                         60,827          25,000
          Payable to clearing brokers                  48,833              -

              Total liabilities                     3,469,250       5,248,140

        Commitments and contingencies

        Stockholders' equity:
          Preferred stock, $0.001 par value,
            1,000,000 shares authorized, none issued       -               -
          Common stock, $0.001 par value;
           200,000,000 shares authorized;
           47,794,537 shares issued
           and outstanding at March 31, 2009
           and 36,725,185 shares issued and
           outstanding at March 31, 2008               47,795          36,725
          Additional paid-in capital               17,794,521      12,631,300
          Accumulated deficit                      (4,204,626)       (592,627)

              Total stockholders' equity           13,637,690      12,075,398
                                                  $17,106,940     $17,323,538

    Contacts: Martin C. Cunningham              Keith R. Knox
              Chairman & CEO                    President
              201-216-0100                      201-216-0100

SOURCE Hudson Holding Corporation

RELATED LINKS
http://www.hudsonsecurities.com