Exhibit 99
Jefferies Reports Second Quarter Financial Results
NEW YORK--(BUSINESS WIRE)--July 21, 2009--Jefferies Group, Inc. (NYSE: JEF) today announced financial results for the second quarter ended June 30, 2009.
Highlights for the second quarter ended June 30, 2009:
- Record net revenues, after preferred interest, of $578 million, up 51% from the prior year
- Net earnings to Common Shareholders of $62 million, versus a loss of $4 million in the prior year
- Net earnings per common share (diluted) of $0.30, versus a loss of $0.05 per share in the prior year
- Record fixed income and commodities revenues of $277 million, up 280% from the prior year
- Investment banking revenues of $121 million, up 10% from the prior year
- High yield revenues of $61 million, up 95% from the prior year
Highlights for the first half ended June 30, 2009:
- Record net revenues, after preferred interest, of $925 million, up 53% from the prior year
- Net earnings to Common Shareholders of $100 million, versus a loss of $65 million in the prior year
- Net earnings per common share (diluted) of $0.49 versus a loss of $0.47 per share in the prior year
Conference Call
A conference call with management discussion of financial results for the second quarter ended June 30, 2009 will be held today, July 21, 2009, at 9:00 AM Eastern. Securities industry professionals may access the management discussion by calling 800-954-1051 or 212-231-2901. A one-week replay of the call will also be available at 800-633-8284 or 402-977-9140 (reservation code # 21429096). A live audio webcast and delayed replay can be accessed at www.jefferies.com.
About Jefferies
Jefferies, a major global securities and investment banking firm, has served companies and their investors for more than 45 years. Headquartered in New York City, with offices in more than 25 cities around the world, Jefferies provides clients with capital markets and financial advisory services, institutional brokerage, securities research and asset management. Jefferies & Company, Inc. is the principal operating subsidiary of Jefferies Group, Inc. (NYSE: JEF: www.jefferies.com).
| CONSOLIDATED STATEMENTS OF EARNINGS | ||||||||||||||||
| (Amounts in Thousands, Except Per Share Amounts) | ||||||||||||||||
| (Unaudited) | ||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||
| Jun 30, 2009 | Jun 30, 2008 | Jun 30, 2009 | Jun 30, 2008 | |||||||||||||
| Revenues: | ||||||||||||||||
| Commissions | 102,527 | 102,521 | 204,378 | 216,172 | ||||||||||||
| Principal Transactions | 283,175 | 141,679 | 435,520 | 141,733 | ||||||||||||
| Investment Banking | 120,831 | 109,372 | 157,917 | 208,579 | ||||||||||||
| Asset Management fees and investment (loss) from managed funds | 556 | 13,479 | 519 | (14,317 | ) | |||||||||||
| Interest | 150,599 | 210,540 | 252,686 | 415,431 | ||||||||||||
| Other | 9,888 | 6,434 | 22,460 | 12,914 | ||||||||||||
| Total Revenues | 667,576 | 584,025 | 1,073,480 | 980,512 | ||||||||||||
| Interest Expense | 77,383 | 191,943 | 141,330 | 387,234 | ||||||||||||
| Net Revenues | 590,193 | 392,082 | 932,150 | 593,278 | ||||||||||||
Interest on Mandatorily Redeemable Preferred Interest of Consolidated Subsidiaries | 12,327 | 9,002 | 7,024 | (11,949 | ) | |||||||||||
Net Revenues, less Mandatorily Redeemable Preferred Interest | 577,866 | 383,080 | 925,126 | 605,227 | ||||||||||||
| Non-Interest Expenses: | ||||||||||||||||
| Compensation and benefits | 348,207 | 277,514 | 561,588 | 537,465 | ||||||||||||
| Floor brokerage and clearing fees | 22,280 | 18,588 | 37,060 | 31,536 | ||||||||||||
| Technology and communications | 37,582 | 29,478 | 68,367 | 60,394 | ||||||||||||
| Occupancy and equipment rental | 17,751 | 20,436 | 34,047 | 37,693 | ||||||||||||
| Business development | 9,535 | 10,978 | 18,980 | 23,878 | ||||||||||||
| Other | 20,183 | 20,617 | 33,574 | 41,098 | ||||||||||||
| Total non-interest expenses | 455,538 | 377,611 | 753,616 | 732,064 | ||||||||||||
| Earnings / (loss) before income taxes | 122,328 | 5,469 | 171,510 | (126,837 | ) | |||||||||||
| Income tax expense / (benefit) | 48,333 | 4,016 | 65,089 | (53,876 | ) | |||||||||||
| Net earnings / (loss) | 73,995 | 1,453 | 106,421 | (72,961 | ) | |||||||||||
| Net earnings / (loss) to Noncontrolling Interests | 12,095 | 5,838 | 6,184 | (8,039 | ) | |||||||||||
| Net earnings / (loss) to Common Shareholders | 61,900 | (4,385 | ) | 100,237 | (64,922 | ) | ||||||||||
| Earnings / (loss) per Common Share | ||||||||||||||||
| Basic | $ | 0.31 | $ | (0.05 | ) | $ | 0.49 | $ | (0.47 | ) | ||||||
| Diluted | $ | 0.30 | $ | (0.05 | ) | $ | 0.49 | $ | (0.47 | ) | ||||||
| Weighted Average Common Shares: | ||||||||||||||||
| Basic | 201,902 | 165,694 | 202,485 | 153,739 | ||||||||||||
| Diluted | 206,027 | 165,694 | 202,505 | 153,739 | ||||||||||||
| Effective tax rate | 40 | % | 73 | % | 38 | % | 42 | % | ||||||||
| JEFFERIES GROUP, INC. AND SUBSIDIARIES | ||||||||||||
| SELECTED STATISTICAL INFORMATION | ||||||||||||
| (Amounts in Thousands, Except Per Share Amounts) | ||||||||||||
| (Unaudited) | ||||||||||||
| Quarters Ended | ||||||||||||
| 6/30/2009 | 3/31/2009 | 12/31/2008 | 9/30/2008 | 6/30/2008 | 3/31/2008 | |||||||
Statement of Earnings | ||||||||||||
Net Revenues, less mandatorily redeemable preferred interest | 577,866 | 347,260 | 186,874 | 298,751 | 383,080 | 222,147 | ||||||
| Non-Interest Expenses: | ||||||||||||
| Compensation and Benefits | 348,207 | 213,381 | 738,506 | 246,186 | 277,514 | 259,951 | ||||||
Non-personnel expenses | 107,331 | 84,697 | 148,136 | 106,221 | 100,097 | 94,502 | ||||||
| Earnings / (loss) before income taxes | 122,328 | 49,182 | (699,768) | (53,656) | 5,469 | (132,306) | ||||||
| Income tax expense / (benefit) | 48,333 | 16,756 | (230,283) | (6,090) | 4,016 | (57,892) | ||||||
| Net earnings / (loss) | 73,995 | 32,426 | (469,485) | (47,566) | 1,453 | (74,414) | ||||||
| Net earnings / (loss) to Noncontrolling Interests | 12,095 | (5,911) | (29,583) | (16,262) | 5,838 | (13,877) | ||||||
| Net earnings / (loss) to Common Shareholders | 61,900 | 38,337 | (439,902) | (31,304) | (4,385) | (60,537) | ||||||
| Diluted earnings / (loss) per Common Share | $ 0.30 | $ 0.19 | $ (2.39) | $ (0.18) | $ (0.05) | $ (0.45) | ||||||
Financial Ratios | ||||||||||||
| Pretax Operating Margin | 21% | 14% | -374% | -18% | 1% | -60% | ||||||
| Compensation and Benefits / Net Revenues | 59% | 62% | 480% | 90% | 71% | 129% | ||||||
| Effective Tax Rate | 40% | 34% | 33% | 11% | 73% | 44% | ||||||
| JEFFERIES GROUP, INC. AND SUBSIDIARIES | ||||||||||||||||||
| SELECTED STATISTICAL INFORMATION | ||||||||||||||||||
| (Amounts in Thousands, Except Per Share Amounts) | ||||||||||||||||||
| (Unaudited) | ||||||||||||||||||
| Quarters Ended | ||||||||||||||||||
| 6/30/2009 | 3/31/2009 | 12/31/2008 | 9/30/2008 | 6/30/2008 | 3/31/2008 | |||||||||||||
Revenues by Source | ||||||||||||||||||
| Equities | 129,645 | 102,832 | 87,054 | 134,853 | 165,250 | 142,551 | ||||||||||||
| Fixed Income and Commodities | 276,616 | 203,344 | 103,890 | 72,875 | 72,763 | 40,295 | ||||||||||||
| High Yield | 60,907 | (7,302 | ) | (89,096 | ) | (59,776 | ) | 31,218 | (53,061 | ) | ||||||||
| Other | 1,638 | 6,034 | - | - | - | - | ||||||||||||
| Total | 468,806 | 304,908 | 101,848 | 147,952 | 269,231 | 129,785 | ||||||||||||
| Investment banking | 120,831 | 37,086 | 87,184 | 130,125 | 109,372 | 99,207 | ||||||||||||
| Asset management fees and investment (loss) / income from managed funds: | ||||||||||||||||||
| Asset management fees | 3,714 | 3,762 | 4,765 | 3,804 | 4,758 | 6,285 | ||||||||||||
| Investment (loss) / income from managed funds | (3,158 | ) | (3,799 | ) | (39,946 | ) | (7,235 | ) | 8,721 | (34,081 | ) | |||||||
| Total | 556 | (37 | ) | (35,181 | ) | (3,431 | ) | 13,479 | (27,796 | ) | ||||||||
| Net Revenues | 590,193 | 341,957 | 153,851 | 274,646 | 392,082 | 201,196 | ||||||||||||
| Interest on Mandatorily Redeemable Preferred Interest of Consolidated Subsidiaries | 12,327 | (5,303 | ) | (33,023 | ) | (24,105 | ) | 9,002 | (20,951 | ) | ||||||||
| Net Revenues, less Mandatorily Redeemable Preferred Interest | 577,866 | 347,260 | 186,874 | 298,751 | 383,080 | 222,147 | ||||||||||||
Other Data | ||||||||||||||||||
| Number of Trading Days | 64 | 61 | 64 | 64 | 64 | 61 | ||||||||||||
| Average Employees | 2,327 | 2,243 | 2,356 | 2,403 | 2,327 | 2,486 | ||||||||||||
| Common Shares Outstanding | 171,927 | 169,195 | 163,216 | 163,429 | 162,121 | 132,762 | ||||||||||||
| Weighted Average Common Shares: | ||||||||||||||||||
| Basic | 201,902 | 203,310 | 183,691 | 173,757 | 165,694 | 141,784 | ||||||||||||
| Diluted | 206,027 | 203,326 | 183,691 | 173,757 | 165,694 | 141,784 | ||||||||||||
| As of June 30, 2009, common stockholders' equity amounted to $2.1 billion, resulting in book value of $12.45 per common share | ||||||||||||||||||
| JEFFERIES GROUP, INC. AND SUBSIDIARIES | ||||||||
| COMMON SHARES OUTSTANDING AND COMMON SHARES FOR BASIC AND DILUTED EPS CALCULATIONS | ||||||||
| (UNAUDITED) | ||||||||
| June 30, 2009 | ||||||||
| Common shares outstanding | 171,927,175 | |||||||
| Outstanding restricted stock units | 27,274,490 | |||||||
| Adjusted shares outstanding | 199,201,665 | |||||||
Note - All share information below for EPS purposes is based upon weighted-average balances for the applicable period. | ||||||||
| Three months ended | Six months ended | |||||||
| June 30, 2009 | June 30, 2009 | |||||||
| Shares Outstanding (weighted average) | (1 | ) | 170,818,847 | 167,960,819 | ||||
| Unearned restricted stock | (2 | ) | (842,829 | ) | (742,039 | ) | ||
| Earned restricted stock units | (3 | ) | 27,356,828 | 28,603,161 | ||||
| Other issuable shares | (4 | ) | 4,568,851 | 6,663,420 | ||||
| Common Shares for Basic EPS | 201,901,697 | 202,485,361 | ||||||
| Stock Options | (5 | ) | 20,437 | 19,427 | ||||
| Mandatorily redeemable convertible preferred stock | (6 | ) | 4,105,138 | - | ||||
| Unearned restricted stock/ restricted stock units | (7 | ) | - | - | ||||
| Common Shares for Diluted EPS | 206,027,272 | 202,504,788 | ||||||
| (1) | Shares outstanding represents shares issued less shares repurchased in treasury stock. Shares issued includes public and private offerings, earned and unearned restricted stock, distributions related to restricted stock units, deferred compensation plans, employee stock purchase plan and stock option exercises. Shares issued does not include undistributed earned and unearned restricted stock units. | |
| (2) | As restricted stock is contingent upon a future service condition, unearned shares are removed from shares outstanding in the calculation of basic EPS as Jefferies' obligation to issue these shares remains contingent. | |
| (3) | As earned restricted stock units are no longer contingent upon a future service condition and are issuable upon a certain date in the future, earned restricted stock units are added to shares outstanding in the calculation of basic EPS. | |
| (4) | Other shares issuable not pursuant to any contingency include shares issuable to settle previously granted restricted stock awards, shares issuable under certain deferred compensation plans and shares issuable in connection with earnout agreements. | |
| (5) | Calculated under the treasury stock method in accordance with FASB 128, Earnings per Share. The treasury stock method assumes the issuance of only a net incremental number of shares as proceeds from issuance are assumed to be used to repurchase shares at the average stock price for the period. | |
| (6) | Calculated under the if-converted method in accordance with FASB 128, Earnings per Share. The if-converted method assumes the conversion of convertible securities at the beginning of the period. The conversion of our mandatorily redeemable convertible preferred stock is considered anti-dilutive to our six month EPS results and not included in Diluted EPS shares. If dilutive, the conversion would result in 4,105,138 shares for the six month EPS results. | |
| (7) | No longer included in the calculation of Diluted EPS. Upon the adoption of FSP EITF 03-6-1 on January 1, 2009, unearned restricted stock and restricted stock units are participating securities and included in EPS calculations under the two-class method. |
CONTACT:
Jefferies Group, Inc.
Peregrine C. Broadbent, 212-284-2338
Chief Financial Officer