Exhibit 99.1
Jefferies Group Announces Record Quarterly Revenues and Net Earnings
NEW YORK--(BUSINESS WIRE)--July 15, 2003--Jefferies Group, Inc.
(NYSE: JEF) today announced record financial results for the second
quarter ended June 27, 2003.
Highlights for the second quarter ended June 27, 2003:
-- Earnings per share (diluted) of $0.65 matched a previous
record and exceeded the $0.64 earned in the second quarter of
2002.
-- Net earnings were a record $18.7 million compared to $17.6
million for the second quarter of 2002.
-- Total revenues were a record $230.2 million versus $200.9
million for the second quarter of 2002.
-- Earnings before income taxes and minority interest were a
record $32.3 million compared to $29.9 million for the second
quarter of 2002.
-- Investment banking revenues were $44.7 million compared to
$41.7 million for the second quarter of 2002.
Highlights for the first six months ended June 27, 2003:
-- Earnings per share (diluted) were $1.14 versus $1.29 for the
first half of 2002.
-- Net earnings were $32.9 million compared to $35.3 million for
the first half of 2002.
-- Total revenues were $415.5 million compared to $396.2 million
for the first half of 2002.
-- Earnings before income taxes and minority interest were $55.6
million compared to $59.9 million for the first half of 2002.
-- Investment banking revenues were $88.9 million compared to
$79.3 million for the first half of 2002.
"We are pleased with the quality and breadth of our second quarter
results. We plan to continue to invest in our platform with the goal
to be the best provider of services for middle market companies and
investors," said Richard B. Handler, Chairman and Chief Executive
Officer of Jefferies.
"The human capital that we've added throughout our firm over the
past few years made a meaningful contribution this quarter," added
John C. Shaw, Jr., President of Jefferies. "Our people are our most
important asset, and we will continue to do our best to challenge and
motivate our existing partners while attracting the best talent to our
team."
Conference Call
A conference call with management discussion of financial results
for the second quarter ended June 27, 2003 will be held July 15 at 11
AM (Eastern) and can be accessed at 617-801-9714 (live code:
22871334). A replay of the call will be available through July 22 at
617-801-6888 (replay code: 465059). A live audio Webcast and delayed
replay will also be available at www.jefco.com and
www.streetevents.com. Questions for consideration by management can be
submitted in advance through the "Contact Us" function at
www.jefco.com or by calling 203-708-5975 by 10 AM Eastern on July 15.
About Jefferies
Jefferies Group, Inc. (NYSE: JEF) is a holding company whose
affiliated companies, including its principal operating subsidiary,
Jefferies & Company, Inc., offer a variety of services for
institutional investors and growth companies. Subsidiaries of
Jefferies Group, Inc., together, comprise a full-service investment
bank and institutional securities firm focused on the middle market.
Jefferies offers financial advisory, capital raising, mergers and
acquisitions, and restructuring services to small and mid-cap
companies. The firm provides outstanding trade execution in equity,
high yield, convertible and international securities, as well as
fundamental research and asset management capabilities, to
institutional investors. Additional services include correspondent
clearing, prime brokerage, private client services and securities
lending. The firm's leadership in equity trading is recognized by
numerous consulting and survey organizations, and Jefferies'
subsidiary, Helfant Group, Inc., executes more than eleven percent of
the daily reported volume on the NYSE.
Through its subsidiaries, Jefferies Group, Inc. employs more than
1,350 people in 20 offices worldwide, including Atlanta, Boston,
Chicago, Dallas, London, Los Angeles, New York, Paris, San Francisco,
Tokyo, Washington and Zurich. Further information about Jefferies,
including a description of investment banking, trading, research and
asset management services, can be found at www.jefco.com.
This press release contains statements that may constitute
"forward-looking statements" within the meaning of the safe harbor
provisions of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended.
These forward-looking statements contain expectations regarding
operations and our statements about plans and objectives. These
forward-looking statements include the words "will," "continue",
"plan" and other similar expressions. These forward-looking statements
represent only our belief regarding future events, many of which, by
their nature, are inherently uncertain and outside of our control.
Actual results could differ materially from those projected in these
forward-looking statements. Please refer to our recent Quarterly
Report on Form 10-Q filed with the Securities and Exchange Commission
on May 9, 2003 and other filings we make with the Securities and
Exchange Commission for a discussion of important factors that could
cause actual results to differ materially from those projected in
these forward-looking statements. We do not assume any obligation to
update any forward-looking statement we make.
PLEASE NOTE: Share and per share information in this press release
have not been restated to retroactively reflect the effect of the
2-for-1 stock split declared by the Board of Directors payable to
stockholders of record as of July 31, 2003.
-- financial tables follow --
JEFFERIES GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(Amounts in Thousands, Except Per Share Amounts)
(Unaudited)
Three Months Six Months
Ended Ended
----------------- -----------------
June 27, June 28, June 27, June 28,
2003 2002 2003 2002
-------- -------- -------- --------
Revenues:
Commissions $ 69,770 $ 63,063 $126,427 $127,636
Principal transactions 80,437 67,288 139,126 133,955
Investment banking 44,716 41,650 88,919 79,318
Interest 30,701 24,447 52,200 46,076
Asset management 3,010 2,724 5,687 6,211
Other 1,575 1,705 3,149 3,023
-------- -------- -------- --------
Total revenues 230,209 200,877 415,508 396,219
Interest expense 31,378 22,748 52,428 40,346
-------- -------- -------- --------
Revenues, net of interest expense 198,831 178,129 363,080 355,873
-------- -------- -------- --------
Non-interest expenses:
Compensation and benefits 114,115 101,715 209,512 206,282
Floor brokerage and clearing fees 12,483 13,442 23,295 27,590
Technology and communications 14,153 13,998 28,624 25,393
Occupancy and equipment rental 9,499 6,148 16,825 12,306
Business development 5,519 5,686 11,569 11,990
Other 10,760 7,243 17,696 12,451
-------- -------- -------- --------
Total non-interest expenses 166,529 148,232 307,521 296,012
-------- -------- -------- --------
Earnings before income taxes and
minority interest 32,302 29,897 55,559 59,861
Income taxes 11,640 12,282 20,712 24,574
-------- -------- -------- --------
Earnings before minority interest 20,662 17,615 34,847 35,287
Minority interest in earnings of
consolidated subsidiaries, net 1,924 -- 1,924 --
-------- -------- -------- --------
Net earnings $ 18,738 $ 17,615 $ 32,923 $ 35,287
======== ======== ======== ========
Earnings per share:
Basic $ 0.75 $ 0.72 $ 1.32 $ 1.43
======== ======== ======== ========
Diluted $ 0.65 $ 0.64 $ 1.14 $ 1.29
======== ======== ======== ========
Weighted average shares:
Basic 25,102 24,626 25,006 24,695
Diluted 29,038 27,436 28,795 27,407
JEFFERIES GROUP, INC. AND SUBSIDIARIES
SELECTED STATISTICAL INFORMATION
(Dollars in Thousands, Except Per Share Amounts)
(Unaudited)
Quarters ended
--------------------------------------------------
6/27/2003 3/28/2003 12/31/2002 9/27/2002 6/28/2002
--------- --------- ---------- --------- ---------
Statement of
Earnings
- ------------
Revenues, net of
interest expense $198,831 $164,249 $159,907 $158,909 $178,129
Non-interest
expenses:
Compensation and
benefits 114,115 95,397 87,425 91,878 101,715
Non-personnel
expenses 52,414 45,595 47,965 47,717 46,517
--------- --------- ---------- --------- ---------
Earnings before
income taxes and
minority interest 32,302 23,257 24,517 19,314 29,897
Income taxes 11,640 9,072 9,015 7,532 12,282
--------- --------- ---------- --------- ---------
Earnings before
minority interest 20,662 14,185 15,502 11,782 17,615
Minority interest
in earnings of
consolidated
subsidiaries, net 1,924 -- -- -- --
--------- --------- ---------- --------- ---------
Net earnings $ 18,738 $ 14,185 $ 15,502 $ 11,782 $ 17,615
========= ========= ========== ========= =========
Diluted earnings
per share $ 0.65 $ 0.50 $ 0.56 $ 0.43 $ 0.64
========= ========= ========== ========= =========
Financial Ratios
- ----------------
Pretax operating
margin 16.2% 14.2% 15.3% 12.2% 16.8%
Compensation and
benefits/net
revenues 57.4% 58.1% 54.7% 57.8% 57.1%
Effective tax rate 36.0% 39.0% 36.8% 39.0% 41.1%
JEFFERIES GROUP, INC. AND SUBSIDIARIES
SELECTED STATISTICAL INFORMATION
(Dollars and Shares in Thousands)
(Unaudited)
Quarters ended
--------------------------------------------------
6/27/2003 3/28/2003 12/31/2002 9/27/2002 6/28/2002
--------- --------- ---------- --------- ---------
Revenues by Source
- ------------------
Commissions and
principal
transactions:
Equities $ 85,047 $ 69,993 $ 86,802 $ 81,613 $ 76,257
International 25,618 16,231 16,703 21,602 19,563
High yield 9,434 10,835 7,479 6,502 9,826
Convertibles 8,570 8,184 7,825 6,823 7,573
Execution 5,946 5,089 5,842 6,380 8,262
Bonds Direct 6,038 4,538 3,293 3,723 2,641
Other proprietary
trading 9,554 476 (5,713) (6,200) 6,229
--------- --------- ---------- --------- ---------
Total 150,207 115,346 122,231 120,443 130,351
Investment banking 44,716 44,203 31,059 29,451 41,650
Interest 30,701 21,499 20,860 25,091 24,447
Asset management 3,010 2,677 3,425 2,390 2,724
Other 1,575 1,574 1,831 1,776 1,705
--------- --------- ---------- --------- ---------
Total revenues $230,209 $185,299 $179,406 $179,151 $200,877
========= ========= ========== ========= =========
Other Data
- ----------
Number of trading
days 63 60 65 63 64
Average employees 1,364 1,359 1,323 1,292 1,229
Common shares
outstanding 27,571 27,568 26,952 26,895 26,930
Weighted average
shares:
Basic 25,102 24,905 24,439 24,645 24,626
Diluted 29,038 28,562 27,618 27,618 27,436
As of June 27, 2003, stockholders' equity amounted to $683
million, resulting in a book value of $24.78 per share.
CONTACT: Jefferies Group, Inc., New York
Joseph A. Schenk, 212-284-2338