MERRILL LYNCH & CO., INC.
Exhibit 99.2
Attachment I
PRELIMINARY UNAUDITED EARNINGS SUMMARY
For the Three Months Ended Percent Inc / (Dec)
----------------------------------------------------------------
March 28, December 27, March 29, 1Q03 vs. 1Q03 vs.
(in millions, except per share amounts) 2003 2002 2002 4Q02 1Q02
-------- ----------- -------- -------- --------
NET REVENUES
Commissions $ 1,069 $ 1,078 $ 1,242 (0.8)% (13.9)%
Principal transactions 1,010 358 877 182.1 15.2
Investment banking
Underwriting 368 414 466 (11.1) (21.0)
Strategic advisory 125 163 183 (23.3) (31.7)
Asset management and portfolio service fees 1,127 1,106 1,293 1.9 (12.8)
Other 205 148 219 38.5 (6.4)
------- ------- -------
Subtotal 3,904 3,267 4,280 19.5 (8.8)
Interest and dividend revenues 3,021 3,212 3,284 (5.9) (8.0)
Less interest expense 2,071 2,274 2,474 (8.9) (16.3)
------- ------- -------
Net interest profit 950 938 810 1.3 17.3
------- ------- -------
TOTAL NET REVENUES 4,854 4,205 5,090 15.4 (4.6)
------- ------- -------
NON-INTEREST EXPENSES
Compensation and benefits 2,496 1,983 2,646 25.9 (5.7)
Communications and technology 403 434 474 (7.1) (15.0)
Occupancy and related depreciation 216 225 238 (4.0) (9.2)
Brokerage, clearing, and exchange fees 170 175 198 (2.9) (14.1)
Advertising and market development 121 114 150 6.1 (19.3)
Professional fees 144 155 130 (7.1) 10.8
Office supplies and postage 58 62 69 (6.5) (15.9)
Other 224 145 173 54.5 29.5
Research and other settlement-related expenses - 180 - (100.0) N/M
Recoveries related to September 11 - (21) - (100.0) N/M
Restructuring and other charges - 10 - (100.0) N/M
------- ------- -------
TOTAL NON-INTEREST EXPENSES 3,832 3,462 4,078 10.7 (6.0)
------- ------- -------
EARNINGS BEFORE INCOME TAXES AND DIVIDENDS ON PREFERRED
SECURITIES ISSUED BY SUBSIDIARIES 1,022 743 1,012 37.6 1.0
Income tax expense 289 157 316 84.1 (8.5)
Dividends on preferred securities issued by subsidiaries 48 47 49 2.1 (2.0)
------- ------- -------
NET EARNINGS $ 685 $ 539 $ 647 27.1 5.9
======= ======= =======
PREFERRED STOCK DIVIDENDS $ 9 $ 9 $ 9 - -
======= ======= =======
EARNINGS PER COMMON SHARE
Basic $ 0.76 $ 0.61 $ 0.75 24.6 1.3
Diluted $ 0.72 $ 0.56 $ 0.67 28.6 7.5
AVERAGE SHARES USED IN COMPUTING EARNINGS PER COMMON SHARE
Basic 887.6 868.2 854.8 2.2 3.8
Diluted 939.2 942.9 949.2 (0.4) (1.1)
ANNUALIZED RETURN ON AVERAGE COMMON EQUITY 11.8% 9.5% 12.7%
-------------------------------------------------------------------------------------------------------------------------------
Certain prior period amounts have been reclassified to conform to the current period presentation.
12
MERRILL LYNCH & CO., INC.
Exhibit 99.2
Attachment II
PRELIMINARY SEGMENT DATA (UNAUDITED)
For the Three Months Ended
----------------------------------------------
March 28, December 27, March 29,
(dollars in millions) 2003 2002 2002
-------- ----------- --------
GLOBAL MARKETS & INVESTMENT BANKING
Non-interest revenues $ 1,807 $ 1,149 $ 1,908
Net interest profit 653 644 477
------- ------- -------
Total net revenues 2,460 1,793 2,385
------- ------- -------
Pre-tax earnings 785 558(a) 643
Pre-tax profit margin 31.9% 31.1% 27.0%
-------------------------------------------------------------------------------------------------------------------------
GLOBAL PRIVATE CLIENT
Non-interest revenues $ 1,779 $ 1,809 $ 1,953
Net interest profit 323 317 346
------- ------- -------
Total net revenues 2,102 2,126 2,299
------- ------- -------
Pre-tax earnings 269 363(b) 272
Pre-tax profit margin 12.8% 17.1% 11.8%
-------------------------------------------------------------------------------------------------------------------------
MERRILL LYNCH INVESTMENT MANAGERS
Non-interest revenues $ 330 $ 328 $ 439
Net interest profit 7 11 3
------- ------- -------
Total net revenues 337 339 442
------- ------- -------
Pre-tax earnings 47 50(c) 114
Pre-tax profit margin 14.0% 14.7% 25.8%
-------------------------------------------------------------------------------------------------------------------------
CORPORATE
Non-interest revenues $ (12) $ (19) $ (20)
Net interest profit (33) (34) (16)
------- ------- -------
Total net revenues (45) (53) (36)
------- ------- -------
Pre-tax earnings (loss) (79) (228) (17)
-------------------------------------------------------------------------------------------------------------------------
TOTAL
Non-interest revenues $ 3,904 $ 3,267 $ 4,280
Net interest profit 950 938 810
------- ------- -------
Total net revenues 4,854 4,205 5,090
------- ------- -------
Pre-tax earnings 1,022 743 1,012
Pre-tax profit margin 21.1% 17.7% 19.9%
-------------------------------------------------------------------------------------------------------------------------
Certain prior period amounts have been restated to conform to the current period presentation.
(a) Includes restructuring-related expenses of $51 million, partially offset by Recoveries related to September 11 of $40
million.
(b) Includes restructuring-related credits of $64 million.
(c) Includes restructuring-related expenses of $23 million.
13
MERRILL LYNCH & CO., INC.
Exhibit 99.2
Attachment III
CONSOLIDATED QUARTERLY EARNINGS (UNAUDITED) (in millions)
1Q02 2Q02 3Q02 4Q02 1Q03
------ ------ ------ ------ ------
NET REVENUES
Commissions
Listed and over-the-counter securities $ 732 $ 718 $ 653 $ 623 $ 618
Mutual funds 341 327 277 274 266
Other 169 167 195 181 185
------ ------ ------ ------ ------
Total 1,242 1,212 1,125 1,078 1,069
Principal transactions 877 728 377 358 1,010
Investment banking
Underwriting 466 501 329 414 368
Strategic advisory 183 194 163 163 125
------ ------ ------ ------ ------
Total 649 695 492 577 493
Asset management and portfolio service fees
Asset management fees 469 430 402 386 385
Portfolio service fees 557 571 526 480 476
Account fees 133 135 138 122 135
Other fees 134 162 151 118 131
------ ------ ------ ------ ------
Total 1,293 1,298 1,217 1,106 1,127
Other 219 219 165 148 205
------ ------ ------ ------ ------
Subtotal 4,280 4,152 3,376 3,267 3,904
Interest and dividend revenues 3,284 3,198 3,484 3,212 3,021
Less interest expense 2,474 2,399 2,498 2,274 2,071
------ ------ ------ ------ ------
Net interest profit 810 799 986 938 950
------ ------ ------ ------ ------
TOTAL NET REVENUES 5,090 4,951 4,362 4,205 4,854
------ ------ ------ ------ ------
NON-INTEREST EXPENSES
Compensation and benefits 2,646 2,569 2,228 1,983 2,496
Communications and technology 474 412 421 434 403
Occupancy and related depreciation 238 228 218 225 216
Brokerage, clearing, and exchange fees 198 172 182 175 170
Advertising and market development 150 151 125 114 121
Professional fees 130 132 135 155 144
Office supplies and postage 69 65 62 62 58
Other 173 163 130 145 224
Research and other settlement-related expenses - 111 - 180 -
Recoveries related to September 11 - - (191) (21) -
Restructuring and other charges - - (2) 10 -
------ ------ ------ ------ ------
TOTAL NON-INTEREST EXPENSES 4,078 4,003 3,308 3,462 3,832
------ ------ ------ ------ ------
EARNINGS BEFORE INCOME TAXES, AND DIVIDENDS
ON PREFERRED SECURITIES ISSUED BY SUBSIDIARIES 1,012 948 1,054 743 1,022
Income tax expense 316 267 313 157 289
Dividends on preferred securities issued by subsidiaries 49 47 48 47 48
------ ------ ------ ------ ------
NET EARNINGS $ 647 $ 634 $ 693 $ 539 $ 685
----------------------------------------------------------------------------------------------------------
Per Common Share Data
1Q02 2Q02 3Q02 4Q02 1Q03
------ ------ ------ ------ ------
Earnings - Basic $ 0.75 $ 0.72 $ 0.79 $ 0.61 $ 0.76
Earnings - Diluted 0.67 0.66 0.73 0.56 0.72
Dividends paid 0.16 0.16 0.16 0.16 0.16
Book value 23.73 24.46 25.17 25.69 25.13 est.
----------------------------------------------------------------------------------------------------------
Certain prior period amounts have been reclassified to conform to the current period presentation.
14
MERRILL LYNCH & CO., INC.
Exhibit 99.2
Attachment IV
PERCENTAGE OF QUARTERLY NET REVENUES (UNAUDITED)
1Q02 2Q02 3Q02 4Q02 1Q03
----- ----- ----- ----- -----
NET REVENUES
Commissions
Listed and over-the-counter securities 14.4% 14.5% 15.0% 14.8% 12.7%
Mutual funds 6.7% 6.6% 6.4% 6.5% 5.5%
Other 3.3% 3.4% 4.4% 4.3% 3.8%
----- ----- ----- ----- -----
Total 24.4% 24.5% 25.8% 25.6% 22.0%
Principal transactions 17.2% 14.7% 8.6% 8.5% 20.8%
Investment banking
Underwriting 9.2% 10.1% 7.6% 9.8% 7.6%
Strategic advisory 3.6% 3.9% 3.7% 3.9% 2.6%
----- ----- ----- ----- -----
Total 12.8% 14.0% 11.3% 13.7% 10.2%
Asset management and portfolio service fees
Asset management fees 9.2% 8.7% 9.2% 9.2% 7.9%
Portfolio service fees 10.9% 11.5% 12.1% 11.4% 9.8%
Account fees 2.6% 2.7% 3.2% 2.9% 2.8%
Other fees 2.7% 3.3% 3.4% 2.8% 2.7%
----- ----- ----- ----- -----
Total 25.4% 26.2% 27.9% 26.3% 23.2%
Other 4.3% 4.5% 3.8% 3.6% 4.2%
----- ----- ----- ----- -----
Subtotal 84.1% 83.9% 77.4% 77.7% 80.4%
Interest and dividend revenues 64.5% 64.6% 79.9% 76.4% 62.3%
Less interest expense 48.6% 48.5% 57.3% 54.1% 42.7%
----- ----- ----- ----- -----
Net interest profit 15.9% 16.1% 22.6% 22.3% 19.6%
----- ----- ----- ----- -----
TOTAL NET REVENUES 100.0% 100.0% 100.0% 100.0% 100.0%
----- ----- ----- ----- -----
NON-INTEREST EXPENSES
Compensation and benefits 52.0% 51.9% 51.1% 47.2% 51.4%
Communications and technology 9.3% 8.3% 9.7% 10.3% 8.3%
Occupancy and related depreciation 4.7% 4.6% 5.0% 5.4% 4.4%
Brokerage, clearing, and exchange fees 3.9% 3.5% 4.2% 4.2% 3.5%
Advertising and market development 2.9% 3.0% 2.9% 2.7% 2.5%
Professional fees 2.6% 2.7% 3.1% 3.7% 3.0%
Office supplies and postage 1.4% 1.3% 1.4% 1.5% 1.2%
Other 3.3% 3.3% 2.9% 3.3% 4.6%
Research and other settlement-related expenses - 2.3% - 4.3% -
Recoveries related to September 11 - - -4.4% -0.5% -
Restructuring and other charges - - -0.1% 0.2% -
----- ----- ----- ----- -----
TOTAL NON-INTEREST EXPENSES 80.1% 80.9% 75.8% 82.3% 78.9%
----- ----- ----- ----- -----
EARNINGS BEFORE INCOME TAXES, AND DIVIDENDS
ON PREFERRED SECURITIES ISSUED BY SUBSIDIARIES 19.9% 19.1% 24.2% 17.7% 21.1%
Income tax expense 6.2% 5.4% 7.2% 3.7% 6.0%
Dividends on preferred securities issued by subsidiaries 1.0% 0.9% 1.1% 1.2% 1.0%
----- ----- ----- ----- -----
NET EARNINGS 12.7% 12.8% 15.9% 12.8% 14.1%
---------------------------------------------------------------------------------------------------------------
COMMON SHARES OUTSTANDING (IN MILLIONS)
1Q02 2Q02 3Q02 4Q02 1Q03
----- ----- ----- ----- -----
Weighted-average - basic 854.8 861.7 864.6 868.2 887.6
Weighted-average - diluted 949.2 942.6 934.5 942.9 939.2
Period-end 862.9 865.4 869.0 873.8 929.8
---------------------------------------------------------------------------------------------------------------
15
MERRILL LYNCH & CO., INC.
Exhibit 99.2
Attachment V
SUPPLEMENTAL DATA (UNAUDITED) (dollars in billions)
1Q02 2Q02 3Q02 4Q02 1Q03
------- ------- ------- ------- -------
ASSETS IN PRIVATE CLIENT ACCOUNTS
U.S.(1) $ 1,158 $ 1,076 $ 997 $ 1,021 $ 1,009
Non - U.S. 96 94 87 89 86
------- ------- ------- ------- -------
Total Assets in Private Client Accounts $ 1,254 $ 1,170 $ 1,084 $ 1,110 $ 1,095
======= ======= ======= ======= =======
ASSETS IN ASSET-PRICED ACCOUNTS $ 206 $ 192 $ 177 $ 182 $ 181
ASSETS UNDER MANAGEMENT $ 518 $ 499 $ 452 $ 462 $ 442
Retail 215 203 182 189 187
Institutional 262 257 234 235 220
Private Investors 41 39 36 38 35
U.S. 323 319 305 313 303
Non-U.S. 195 180 147 149 139
Equity 257 234 190 191 183
Fixed Income 119 121 119 122 108
Money Market 142 144 143 149 151
------------------------------------------------------------------------------------------------
NET NEW MONEY
PRIVATE CLIENT ACCOUNTS(2)
U.S. $ - $ 4 $ 4 $ 11 $ (4)
Non-U.S. 1 - (2) - (1)
------- ------- ------- ------- -------
Total 1 4 2 11 (5)
------- ------- ------- ------- -------
ASSETS UNDER MANAGEMENT(2) $ (7) $ (5) $ (12) $ 5 $ (11)
------------------------------------------------------------------------------------------------
BALANCE SHEET INFORMATION (ESTIMATED)
Commercial Paper and
Other Short-term Borowings $ 4.6 $ 6.0 $ 6.6 $ 5.4 $ 3.5
Deposits 85.9 81.1 80.8 81.8 81.9
Long-term Borrowings 77.3 75.5 73.9 78.5 77.0
Preferred Securities Issued
by Subsidiaries 2.7 2.7 2.7 2.7 2.7
Total Stockholders' Equity 20.9 21.6 22.3 22.9 23.8
------------------------------------------------------------------------------------------------
GLOBAL EQUITY AND EQUITY-LINKED UNDERWRITING(1)(3)
Volume $ 15 $ 10 $ 3 $ 6 $ 4
Market Share 14.5% 9.4% 6.0% 10.6% 7.8%
Ranking 2 3 5 2 5
GLOBAL DEBT UNDERWRITING(1)(3)
Volume $ 96 $ 86 $ 65 $ 59 $ 88
Market Share 8.5% 8.4% 7.7% 6.6% 7.1%
Ranking 2 3 3 6 3
GLOBAL COMPLETED MERGERS AND ACQUISITIONS(1)(3)
Volume $ 62 $ 64 $ 79 $ 116 $ 38
Market Share 22.1% 20.1% 23.8% 29.7% 16.6%
Ranking 3 4 3 5 4
------------------------------------------------------------------------------------------------
FULL-TIME EMPLOYEES(4) 56,100 54,400 53,200 50,900 49,600
PRIVATE CLIENT FINANCIAL ADVISORS 15,900 15,100 14,600 14,000 13,600
-------------------------------------------------------------------------------------------------
(1)Certain prior period amounts have been restated to conform to the current period presentation.
(2)Excluding the impact related to the restructuring of the Non-U.S. businesses.
(3)Full credit to book manager. Market shares derived from Thomson Financial Securities Data statistics.
(4)Excludes 500, 1,500, 700, 1,000 and 600 full-time employees on salary continuation severance at the end of 1Q03, 4Q02, 3Q02,
2Q02 and 1Q02, respectively.
For more information, please contact:
Investor Relations Phone: 866-607-1234
Merrill Lynch & Co., Inc. Fax: 212-449-7461
investor_relations@ml.com
www.ir.ml.com
16