GS 1Q08 Earnings Recap

GOLDMAN SACHS 1Q08 Earnings Report Stats:

Beat ?: YES (reported $3.23/share vs. analysts' consensus of $2.60/share)

Profit--> down 53% to $1.51 Billion (from $3.2 Billion)
Sales --> down 35% to $8.3 Billion (from $12.7 Billion)

Sales By Business Unit:
A.) Trading and Principle Investments: net revs of 5.12 billion (down 46% yoy)
*Fixed Income, Currency + Commodities (FICC): net revs of $3.14 Billion (down 32% yoy)
*Equities: net revs of $2.51 Billion (down 19% yoy)

B.) Asset Management + Securities Services: net revs of $2.04 Billion (up 28% yoy)
*Asset Management: net revs of $1.32 Billion (up 23% yoy)
*Securities Services: net revs of $722 million (up 38% yoy)

C.) Investment Banking: net revs of $1.17 Billion (down 32% yoy)

Other Highlights + Guidance:
*Marks the 11th straight quarter GS has exceeded analyst estimates
*Assets under Management increased 21% yoy to $873 Billion (net inflows of $29 Billion during the past qtr)...looks like GS may have picked up some marketshare from Bear
*Operating Expenses decreased 21% yoy to $6.19 Billion
*Book Value per common share = $92.44...TANGIBLE Book Value = $80.28/share
*GS wrote down about $1.0 Billion from losses on mortgage-related assets during the qtr
*GS's Return On Equity was 15% in 1Q08 (down from 38% in 1Q07)

*GS still currently holds about $20 Billion in mortgages ($12 Billion in prime, $5 Billion in Alt-A and $2 Billion in subprime mortgages)

*GS's LEVEL 3 ASSETS (the most difficult assets to value) rose from 7% of the firm's total assets in the prior qtr to 8%...gain was largely due to GS moving some commercial real estate loans from level 2 to 3

*Buyback --> GS bought back 7.9 million shares at an avg of $198.87/share (total cost of $1.56 Billion) over the past quarter...remaining share authorization for buyback is 63.5 million shares

"Our liquidity position now is stronger than it's ever been before...in my 9 years of being CFO we have never had a stronger liquidity position than we have now." - Goldman Saachs CFO, David Viniar (during the earnings conference call on 3/18/08 and AFTER the Fed opened up the discount window to brokers)

Full Disclosure: I currently own shares of GS.