COHN - Earnings call transcript Q3 2024

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Operator

Good morning, ladies and gentlemen, and welcome to Cohen & Company's Third Quarter 2024 Earnings Call. My name is Daryl, and I will be your operator for today.

Before we begin, Cohen & Company would like to remind everyone that some of the statements the company makes during this call may contain forward-looking statements under applicable securities laws. These statements may involve risks and uncertainties that can cause the company's actual results to differ materially from the results discussed in such forward-looking statements. The forward-looking statements made during this call are made only as of the date of this call, and the company undertakes no obligation to update such statements to reflect subsequent events or circumstances. XX-K you its the its earnings annual on advises forward-looking note most Company SEC. report in the statements release Form & to cautionary read regarding recent Cohen with filed and in

it Earlier a today, press third release, also be complementary the shortly opened XXXX conference believes conclusion will earnings release. quarter of at which provided for include the is is of issued this be certain prepared replay when is results. recorded, to discussion the the meaningful that After financial financial call release cohenandcompany.com. X company's Today's call. The website announcing for company's management measures the company's financial to the that days & non-GAAP the A call Cohen after GAAP Company of a press and will reconciliation remarks available questions. being available on these This in measures company's evaluating remarks, performance. non-GAAP are measures beginning comparable

I like Executive & Lester Cohen Mr. Officer of call Brafman, Company. the would over to Chief now to hand

Lester Brafman

full-service thank trends and half the Daryl, call Cohen call. with quarter year and momentum investment Joe Company us into execution the continued operation. boutique for our CFO. The me everyone, banking quarter first from XXXX & you, Thank earnings for our Markets, With our Pooler, third the is for on joining the positive third you, extended of CCM, a strong Capital

focused production the the robust, performance despite our payment by We and the as are line investment We improved CCM's adjustments quarterly remains SPAC earnings million book enhancing our expect adjusted X $XX.X for our company's of through confident consistent runner IPO. proud million advisory revenue on are year-to-date unfavorable report continued long-term lead of principal including mark-to-market stockholders, potential value year. The from and remain end about portfolio. and acted XXXX that has on future sustainable to at generated the impact throughout our CCM ongoing pipeline versus pretax of of CCM dividend. we on $XX.X

call will financial Now the highlights detail. to return walk I this to over in quarter's through more Joe

Joseph Pooler

Lester. you, the results a for I'll discussion Thank begin of operating quarter. our with

attributable or to for the quarter fully or per share was compared fully Our Inc. prior net per quarter $X.X net or $X.X the $XXX,XXX share. net $X.XX million & for share the Cohen million per Company, diluted year loss of fully $X.XX income to and loss of quarter for $X.XX prior diluted diluted

to for $X.X year prior pretax and was loss adjusted adjusted $X.X million million the of quarter. for compared loss quarter income Our adjusted pretax the $X.X the for quarter million pretax of prior

noncontrolling measurement a our earnings earnings pretax Inc. consolidated by holds interest which is convertible & subsidiary loss which & in Cohen his income the incorporates and Company, LLC, and Founder As adjusted interest, for to is reminder, held our through key of operating us Cohen a as subsidiary, Company, enterprise attributable the Daniel primary substantially is Chairman, it a Daniel enterprise Cohen.

third the quarter, increase increase from million second an year and issue the an the quarter was in $XX.X quarter. $XX advisory million from revenue ago of New $XX.X million of

number thus engagement The of underlying transactions the our the transaction per in fluctuations And closes, of underlying earned generally volatile. A small has new result earned engagements. revenue as we in revenue in of of can revenue average revenue will the Our can number and when We quarter-to-quarter increases timing well. limited been the to continue advisory engagements a and from expect revenue from is recognition. volatility our recognized. revenue be change issue an the revenue earn fluctuate

$X.X to the the from value, the are included The other instruments trading instead was investments In some our component at addition, Group quarter from Wholesale 'XX. $X.X from the fair of cash in services affiliates balance investments quarter Group, increase third third method Middle yet quarter, in to cases, quarter second was other we which financial is of prior the revenue higher in sheets. Net Agency consideration Mortgage by trading provided not year CCM of consolidated and in as due came sold million at comparable our have Group, purchased Markets which up primarily and our revenue a received investments million new advisory equity for Group. and in which in

revenue Our was change related deferred the European which year year comparable The asset in from and funds. from was one to of $XXX,XXX prior quarter. the million prior to quarter, totaled fees the management prior quarter our up performance in the $X.X quarter primarily

of other was transactions the of value founder combination mark-to-market Equity related and received will in public negatively decline, -- revenue SPAC due investor leading our increased the combination continue be asset principal $X.X investments our to of anticipate the on post-business continued impacting in companies. involvement quarter and we principal method in transaction holdings in a there adjustments our therefore, value, that principal our has post-business in negative volatility equity to both positions which has the operating results. as to items. We primarily SPACs many portfolio million shares decrease resulted a to line adviser and equity manager, Third sponsor management market asset and principal

million cases, which in net $X.X as compensation. The affiliates quarter assets, at XXX investment of the in fluctuations and of from trust all fallen of on includes preferred in X certain losses clients at from at $XX for quarters to financial from portfolio. to and prior our transactions value. Principal the expense for consideration investment the was company of $XXX,XXX on number investment million instrument. XX our debt earned due primarily of million, interest the we on income noncontrolling equity on interest prior and line Compensation million, was have and nonconvertible our method up banking those SPAC revenue, in redeemable September and and addition, subsequently gains and the these expense instruments, of of benefits the variable XXX revenue In our both net form on XX,XXX the was assets senior third income -- quarter the was received investment our employees notes, $X.X quarter of related our quarter 'XX. Net incentive end compared negative including XXX $XX credit XXX $XXX,XXX $XX.X end

million or note equity During of totaled X/X Loss promissory we quarter September method cash. or restructured into from affiliates in 'XX, a during redeemable financial repaid the million instrument $X.X $X.X and X/X the $XXX,XXX. of

generally line noncontrolling in interests nonconvertible recorded $X.X managers During our of subsidiaries certain the by SPAC and also principal series represent These in credit and an to million in the fund other attributable that line foreign noncontrolling in income net item. consolidated and quarter, we The record revenue nonconvertible transactions ownership charge interest equity offset funds. SPAC net of is certain amounts there line offsetting loss our affiliates an income items. item the loss our to was portfolio our current method the from

of end balance quarter nonconvertible million total year. our the Thus, compared at quarter the to equity note. from as the at financial September quarter, consolidated of the equity, year. At of sheet, $XX.X The of increase $X.XX the end into million, million excluding and the component end equity a of at the interest total the of $XX.X year. reflecting the increase corporate was of of end at enterprise was $XX.X XX, instrument noncontrolling redeemable carried of 'XX, the the promissory was noncontrolling was refinancing $X.X $XX.X the indebtedness million terms nonconvertible million million million interest In at a end, the $XX.X component at million from the end total $X.X $XXX.X million

Lester record X as 'XX. 'XX of per share of mentioned, stockholders of declared quarterly a As $X.XX November have XX we on to payable December of dividend of

will be results future regarding Board each evaluate that, dividend the and the The Lester. over needs. With policy capital operating quarter I'll to to impacted turn company's back may by continue dividends it decisions and quarterly

Lester Brafman

Operator, Thanks, now or also The Joe. call e-mail can found at Please questions. to information for the any our via earnings release. questions Pooler bottom contact you to direct investorrelations@cohenandcompany.com. the XXX-XXXX investor open (XXX) at can of be off-line in Joe

Operator

like comments. [Operator closing Instructions] management back for to any at to I the not seeing this would time. any hand over I'm call questions

Lester Brafman

Well, thank look our forward we next today, joining for you to in quarterly to release. and speaking us you all

Operator

does conclude We appreciate you. today's This teleconference. participation. Thank your

You may your disconnect your lines of at this day. time. the Enjoy rest

Cohen & Company (COHN) 4 Nov 242024 Q3 Earnings call transcript