gbl8k080907.htm

[Missing Graphic Reference]

One Corporate Center

Rye, NY 10580-1422

Tel. (914) 921-5147

GAMCO Investors, Inc

Fax (914) 921-5392

www.gabelli.com

For Immediate Release:	Contact:	Douglas R. Jamieson
		President & Chief Operating Officer
		(914) 921-5020

		Kieran Caterina
		Acting Co-Chief Financial Officer
		(914) 921-5149

		For further information please visit
		www.gabelli.com

GAMCO Reports Record Second Quarter Earnings

Restates 2006 earnings from $2.40 per share to $2.49 per share

Reports Record AUM of $30.6 Billion

Rye, New York, August 9, 2007 – GAMCO Investors, Inc. (GAMCO) (NYSE: GBL) today announced second quarter 2007 earnings. The second quarter 2007 net income was $18.0 million, or $0.63 per fully diluted share, about double the restated $8.9 million, or $0.31 per fully diluted share in 2006 ($0.30 per fully diluted share as previously restated). The restated second quarter 2006 results reflect a previously-reported special charge of $0.27 per fully diluted share.

During the second quarter of 2007, we elected to terminate a compensation arrangement for one of our closed-end funds which resulted in a one-time $0.08 reduction in fully diluted earnings per share. Additionally, GAMCO has filed a Form 10-K/A restating the reported 2006 earnings, increasing them to $2.49 per fully diluted share from $2.40 per fully diluted share, to reflect the reversal of certain previously-accrued expenses for compensation in investment partnerships.

For the six months ended June 30, 2007, net income was $37.2 million versus a restated $27.9 million in the comparable 2006 period and fully diluted earnings per share were $1.30 versus a restated $0.96 in the comparable 2006 period. The six-month 2006 results were after a special charge of $0.27 per fully diluted share and after the $0.02 per fully diluted share reversal of the previously-accrued investment partnerships compensation expenses, as filed on our Form 10-K/A, disclosed above.

During the six months ended June 30, 2007, net income was crimped by $0.12 per fully diluted share as a result of the $0.08 per fully diluted share decrease for the second quarter 2007 as mentioned above and $0.04 per fully diluted share impact that was reflected in first quarter 2007 for the following one-time charges:

-	$0.03 per fully diluted share launch expenses of our new closed-end fund, Gabelli Global Deal Fund; and

-	a half cent per fully diluted share in charitable gifts.

Assets Under Management – Record $30.6 Billion at June 30th

Assets Under Management (AUM) were a record $30.6 billion as of June 30, 2007, 4.3% higher than March 31, 2007 AUM of $29.4 billion and 14.4% greater than June 30, 2006 AUM of $26.8 billion. Equity assets under management were a record $29.9 billion on June 30, 2007, 4.2% more than March 31, 2007 equity assets of $28.7 billion and 15.7% above the $25.9 billion on June 30, 2006.

-	Our closed-end equity funds reached a record AUM of $6.4 billion on June 30, 2007, up 3.6% from $6.2 billion on March 31, 2007 and 21.9% higher than the $5.3 billion on June 30, 2006.

-	Our open-end equity fund AUM were $9.5 billion on June 30, 2007, a 7.6% gain from $8.9 billion on March 31, 2007 and 22.2% from $7.8 billion at June 30, 2006.

Our institutional and high net worth business had $13.5 billion in separately managed accounts on June 30, 2007. While up only a nominal 2.1% from $13.2 billion on March 31^st, we do note that – as previously disclosed – on June 22^nd we were displaced as a subadvisor to a mutual fund entity as a result of its sale. We managed $551 million as of March 31, 2007 for this account.

-	Our Investment Partnerships AUM were $486 million on June 30, 2007 versus $477 million on March 31, 2007 and $536 million on June 30, 2006.

We receive incentive and fulcrum fees for our investment partnership assets, certain institutional client assets, preferred issues of our closed-end funds and our new closed-end fund launched in January 2007, the Gabelli Global Deal Fund. As of June 30, 2007, assets generating performance-based fees were $3.6 billion, an increase of 3.8% versus the $3.5 billion on March 31, 2007 and a 19.5% increase over the $3.0 billion on June 30, 2006.

-	Fixed income AUM, primarily money market mutual funds, totaled $705 million on June 30, 2007 compared to AUM of $640 million on March 31, 2007 and AUM of $918 million on June 30, 2006.

Financial Results

In the first quarter of 2006, the provisions of FASB Interpretation No. 46R (“FIN 46R”) and Emerging Issue Task Force 04-5 (“EITF 04-5”) required the consolidation of our investment partnerships and offshore funds managed by our subsidiaries into our consolidated financial statements. However, since we amended the agreements of certain investment partnerships and an offshore fund on March 31, 2006, FIN 46R and EITF 04-5 only required us to consolidate these entities on our consolidated condensed statement of income for the first quarter 2006. Accordingly, to provide a better understanding of our core results and trends, GAMCO has provided the 2006 results before adjusting for FIN 46R and EITF 04-5. These results are not presented in accordance with generally accepted accounting principles (“GAAP”) in the United States. A reconciliation of these non-GAAP financial measures to results presented in accordance with GAAP is presented in Table V.

Restatement

GAMCO has filed a Form 10-K/A restating prior year results to reflect the reversal of certain previously-accrued expenses for investment partnerships. The net effect on a per share basis (diluted) was:

	2006
EPS	1^st Quarter		2^nd Quarter		3^rd Quarter		4^th Quarter		Full Year
Restated	$	0.64	$	0.31	$	0.60	$	0.94	$	2.49
Reported	$	0.63	$	0.30	$	0.59	$	0.88	$	2.40

Revenues

For the second quarter of 2007, investment advisory fees were $57.7 million, an increase of $4.1 million or 7.6% compared to the revenues in 2006 before adjusting for FIN 46R and EITF 04-5:

-	Our closed-end funds revenues surged 19.3% to $12.8 million in the second quarter 2007 from $10.8 million in 2006, driven by investment returns and the launch of a new fund.

-	Open-end mutual funds revenues grew 15.7% to $23.3 million from $20.1 million in second quarter 2006, primarily due to investment performance.

-	Institutional and high net worth separate accounts revenues decreased 2.4% to $20.3 million from $20.7 million in second quarter 2006, predominantly the result of a shift in the recognition of performance fees.

-	Investment Partnership revenues were $1.3 million, down 31.2%, or $0.6 million below revenues in 2006, before adjusting for FIN 46R and EITF 04-5. A decrease in AUM led to lower management fees as well as a decline in incentive fees.

Commission revenues from our institutional research business, Gabelli & Company, Inc., were $4.0 million in the second quarter 2007, up 42.7% from the prior year. The increase was due to higher average per share revenue due to changes in trade mix as well as to an increase in overall trading volume.

Mutual fund distribution fees and other income were $6.6 million for the second quarter 2007, an increase of $1.4 million, or 25.6%, from $5.2 million in second quarter 2006.

For the six months ended June 30, 2007, investment advisory fees were $114.2 million, an increase of $10.2 million or 9.8% compared to the revenues in 2006 before adjusting for FIN 46R and EITF 04-5:

-	Our closed-end funds revenues surged 17.3% to $24.6 million for the six months ended June 30, 2007 from $21.0 million in 2006, driven by investment returns and the launch of two funds.

-	Open-end mutual funds revenues grew 11.0% to $44.7 million from $40.2 million in 2006 as a result of higher average AUM.

-	Larger performance fees contributed to institutional and high net worth separate account revenues increasing 4.3% to $41.9 million from $40.1 million reported in 2006.

-	Investment Partnership revenues were $3.1 million versus $3.6 million in 2006 before adjusting for FIN 46R and EITF 04-5.

Commission revenues from our institutional research business, Gabelli & Company, Inc., were $8.1 for the six months ended June 30, 2007, up 26.3% from the prior year’s comparable amount of $6.4 million. The increase was due to higher overall trading volume as well as to an increase in average per share revenue due to changes in trade mix.

Mutual fund distribution fees and other income were $12.6 million for the six months ended June 30, 2007, an increase of $2.0 million, or 19.2%, from $10.6 million from the 2006 period.

Operating Margin

The operating margin before management fee was 36.3% for the second quarter of 2007 compared to 37.6% in the prior year period. The second quarter 2007 operating margin was impacted by a one-time charge relating to the termination of a closed-end fund compensation agreement while the 2006 quarter included a reserve relating to a proposed resolution of a regulatory matter. Including these items, the second quarter 2007 reported operating margin was 30.2% versus a reported 18.3% in the comparable 2006 period.

Other Income / Expense

Total other income (which represents primarily investment income in our proprietary investments), net of interest expense, was $14.0 million for the second quarter 2007 compared to $7.0 million in 2006.

Total other income, net of interest expense, was $24.2 million for the six months ended June 30, 2007 compared to $18.1 million in 2006 before adjusting for FIN 46R and EITF 04-5.

The management fee for the three months ended June 30, 2007 was $3.4 million versus $1.8 million in 2006.

The effective tax rate for the three months ended June 30, 2007 was 41.2% as compared to the prior year quarter’s effective rate of 44.8%. For the six months ended June 30, 2007, the effective tax rate was 38.9% as compared to 39.5% in the prior year’s comparable period.

Business Highlights

·	In May 2007, the shareholders of the Gabelli Equity Trust approved the spin-off of the Gabelli Healthcare & Wellness^RX Trust, our ninth closed-end fund.

·	In June, The Gabelli SRI Fund was launched. This is an open-end fund that will invest according to the Fund's stated socially responsible guidelines.

Our Board has authorized management to take the steps necessary to prepare for the spin-off of our interest in Gabelli Advisers, Inc. Gabelli Advisers, Inc. the 42%-owned subsidiary and advisor to the six GAMCO Westwood open-end funds with $433 million in AUM. Four of the GAMCO Westwood Funds' Class AAA shares are rated four stars or better by Morningstar. While this proposed spin-off does not require a shareholder vote, we intend to present it for a vote along with other items at a special meeting of shareholders later this year.

Our Board has authorized management to take the steps necessary to prepare for the spin-off of our interest in Gabelli Advisers, Inc. Gabelli Advisers, Inc. is our 42%-owned subsidiary, which is the advisor to the six Westwood open-end funds, of which 4 are rated four or five stars by Morningstar, and which have $433 million in AUM. While this proposed spin-off does not require a shareholder vote, we intend to present it for a vote along with other items at a special meeting of shareholders later this year.

·	GAMCO expects to establish an office in Shanghai, China to provide research and investment opportunities for our hedge funds as well as for venture capital and private equity.

·	GAMCO celebrated its Thirtieth Anniversary by hosting its annual dinner for institutional and high net worth individuals at the American Museum of Natural History.

We modified the terms of the $50 million convertible note issued by GAMCO with Cascade Investment LLC in April 2007 to extend the exercise date for Cascade’s put option from May 15, 2007 to December 17, 2007 and to extend the expiration date of the related letter of credit. The note matures in August 2011, bears interest at the annual rate of 6%, and has a conversion price of $53 per GAMCO share. Should Cascade Investment LLC convert its note, they would own approximately 11% of GAMCO's Class A Common Stock.

·	Robert W. Bruce III, former President and Chief Investment Officer of Fireman’s Fund, was the third recipient of the Graham & Dodd, Murray, Greenwald Prize for Value Investing.

·	Gabelli & Company, Inc., our institutional equity research firm, held its 5^th annual Dental & Veterinary Conference during second quarter 2007. Favorable demographic trends and new technologies continue to drive demand for those firms.

Agnes Mullady was named President and C.O.O. of the Closed End Fund segment of Gabelli Funds, LLC., both of which are newly-created positions. Agnes will continue to serve as Vice President of Gabelli Funds, LLC and is Treasurer of all Gabelli investment companies, both open end and closed end, advised by the advisory affiliates of GAMCO Investors, Inc.

Financial Highlights

Statement of Financial Condition – Liquidity and Flexibility

We ended the quarter with approximately $708.7 million in adjusted cash and investments, which is net of $7.4 million of cash and investments held by our consolidated investment partnerships. This included approximately $140.4 million of our investments in The Gabelli Dividend & Income Trust, The Gabelli Global Deal Fund, Westwood Holdings Group, various Gabelli and GAMCO open-end mutual funds as well as other investments classified as available for sale securities. Our debt consisted of $100 million of 5.5% senior notes due May 2013 and a $50.0 million 6% convertible note due August 2011. We had cash and investments in securities, net of debt and minority interest, of $19.62 per share on June 30, 2007 compared with $17.13 per share on December 31, 2006 and $15.52 per share on June 30, 2006.

Stockholders' equity was $490.8 million or $17.44 per share on June 30, 2007 compared to $451.6 million or $15.99 per share on December 31, 2006 and $402.4 million or $14.23 per share on June 30, 2006.

Shareholder Compensation

Dividends

In addition to the regular quarterly dividend of $0.03 per share, which was declared on May 9, 2007 and paid on June 28, 2007, subsequent to the end of our quarter, the Board of Directors declared a special cash dividend of $1.00 per share paid on July 30, 2007 to holders of record on July 23, 2007.

Stock Buyback

Shares outstanding on June 30, 2007 were 28.1 million, slightly below March 31, 2007 shares of 28.2 million and approximately 0.5% lower than 28.3 million shares outstanding on June 30, 2006. Fully diluted shares outstanding for the first quarter of 2007 were 29.1 million, 0.1 million below the first quarter 2007 fully diluted shares outstanding and 1.2% below our fully diluted shares of 29.5 million for the second quarter 2006.

Through June 30, 2007, we repurchased 4,783,858 class A common shares at an average investment of $39.58 per share since our buyback program was initiated in March 1999. In the second quarter of 2007, we repurchased 55,600 shares at an average investment of $49.35 per share. The total amount of shares currently available for repurchase under the current authorization is approximately 934,000 shares at June 30, 2007.

NOTES ON NON-GAAP FINANCIAL MEASURES

A.	Cash and investments as adjusted have been computed as follows: (in millions)

	6/30/06		12/31/06		6/30/07
Cash and cash equivalents	$	116.9	$	138.1	$	104.7
Investments (marketable securities)		455.4		479.2		458.8
Total cash and investments (marketable securities)		572.3		617.3		563.5
Net amounts receivable/(payable) from/to brokers		32.1		17.3		12.2
Adjusted cash and investments (marketable securities)		604.4		634.6		575.7
Investments (available for sale)		86.7		102.0		140.4
Total adjusted cash and investments	$	691.1	$	736.6	$	716.1

We believe adjusted cash and investments is a more useful measure of the company’s liquidity for analytical purposes.

Net amounts receivable/(payable) from/to brokers reflect cash and cash equivalents held with brokers and cash payable for securities purchased and recorded on a trade date basis for which settlement occurs subsequent to period end.

Operating income before management fee expense is used by management for purposes of evaluating its business operations. We believe this measure is useful in illustrating the operating results of the Company as management fee expense is based on pre-tax income, which includes non-operating items including investment gains and losses from the company’s proprietary investment portfolio and interest expense. The reconciliation of operating income before management fee expense to operating income is provided in Table V.

Beginning January 1, 2006, the provisions of FASB Interpretation No. 46R (“FIN 46R”) and Emerging Issue Task Force 04-5 (“EITF 04-5”) require consolidation of the majority of our investment partnerships and offshore funds managed by our subsidiaries into our consolidated financial statements. However, since we amended the agreements of certain investment partnerships and an offshore fund on March 31, 2006, FIN46R and EITF 04-5 only required us to consolidate these entities on our consolidated condensed statement of income for the first quarter 2006. We were not required to consolidate these entities on our consolidated condensed statement of financial condition at March 31, 2006. In addition, these partnerships and offshore funds, for which the agreements were amended, are not required to be consolidated within our consolidated condensed statement of income or on our consolidated condensed statement of financial condition in future periods as long as we continue to not maintain a direct or indirect controlling financial interest. For the six months ended June 30, 2006, the consolidation of these entities had no impact on net income but did affect the classification of income between operating and other income. As a result, in Table V, we have also provided our results before adjusting for FIN 46R and EITF 04-5.

SPECIAL NOTE REGARDING FORWARD-LOOKING INFORMATION

Our disclosure and analysis in this press release contain some forward-looking statements. Forward-looking statements give our current expectations or forecasts of future events. You can identify these statements because they do not relate strictly to historical or current facts. They use words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” and other words and terms of similar meaning. They also appear in any discussion of future operating or financial performance. In particular, these include statements relating to future actions, future performance of our products, expenses, the outcome of any legal proceedings, and financial results. Although we believe that we are basing our expectations and beliefs on reasonable assumptions within the bounds of what we currently know about our business and operations, there can be no assurance that our actual results will not differ materially from what we expect or believe. Some of the factors that could cause our actual results to differ from our expectations or beliefs include, without limitation: the adverse effect from a decline in the securities markets; a decline in the performance of our products; a general downturn in the economy; changes in government policy or regulation; changes in our ability to attract or retain key employees; and unforeseen costs and other effects related to legal proceedings or investigations of governmental and self-regulatory organizations. We also direct your attention to any more specific discussions of risk contained in our Form 10-K and other public filings. We are providing these statements as permitted by the Private Litigation Reform Act of 1995. We do not undertake to update publicly any forward-looking statements if we subsequently learn that we are unlikely to achieve our expectations or if we receive any additional information relating to the subject matters of our forward-looking statements.

The company reported Assets Under Management as follows:

Assets Under Management (millions)

Table I:

Mutual Funds:	June 30, 2006		June 30, 2007		% Inc. (Dec.)
Open-end	$	7,796	$	9,529		22.2	%
Closed-end		5,258		6,412		21.9
Fixed Income		863		684		(20.7	)
Total Mutual Funds		13,917		16,625		19.5
Institutional & Separate Accounts:
Equities: direct		9,520		11,116		16.8
“ sub-advisory		2,750		2,383		(13.3	)
Fixed Income		55		21		(61.8	)
Total Institutional & Separate Accounts		12,325		13,520		9.7
Investment Partnerships		536		486		(9.3	)
Total Assets Under Management	$	26,778	$	30,631		14.4

Equities	$	25,860	$	29,926		15.7
Fixed Income		918		705		(23.2	)
Total Assets Under Management	$	26,778	$	30,631		14.4

Table II:

	Assets Under Management (millions)
											% Increase/(decrease)
Mutual Funds		6/06		9/06		12/06		3/07		6/07		3/07		6/06
Open-end	$	7,796	$	7,854	$	8,389	$	8,858	$	9,529		7.6	%	22.2	%
Closed-end		5,258		5,327		5,806		6,188		6,412		3.6		21.9
Fixed income		863		683		744		591		684		15.7		(20.7	)
Total Mutual Funds		13,917		13,864		14,939		15,637		16,625		6.3		19.5
Institutional & Separate Accounts:
Equities: direct		9,520		9,470		10,282		10,587		11,116		5.0		16.8
“ sub-advisory		2,750		2,725		2,340		2,608		2,383		(8.6	)	(13.3	)
Fixed Income		55		54		50		49		21		(57.1	)	(61.8	)
Total Institutional & Separate Accounts		12,325		12,249		12,672		13,244		13,520		2.1		9.7
Investment Partnerships		536		488		491		477		486		1.9		(9.3	)
Total Assets Under Management	$	26,778	$	26,601	$	28,102	$	29,358	$	30,631		4.3		14.4

Table III:	Fund Flows – 2^nd Quarter 2007 (millions)

	March 31, 2007	Net Cash Flows	Market Appreciation / (Depreciation)	June 30, 2007

Mutual Funds:
Equities	$	15,046	$	149		$	746	$	15,941
Fixed Income		591		80			13		684
Total Mutual Funds		15,637		229			759		16,625
Institutional & Separate Accounts
Equities: direct		10,587		(161	)		690		11,116
“ sub-advisory		2,608		(415	)		190		2,383
Fixed Income		49		(29	)		1		21
Total Institutional & Separate Accounts		13,244		(605	)		881		13,520

Investment Partnerships		477		(3	)		12		486
Total Assets Under Management	$	29,358	$	(379	)	$	1,652	$	30,631

Table IV

GAMCO INVESTORS, INC

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Dollars in thousands, except per share data)


	For the Three Months Ended June 30,
	2006 (a)			2007			% Inc. (Dec.)

Revenues…………………………………………	$	61,659		$	68,277			10.7	%
Expenses………………………………………….		50,378			47,660			(5.4	)

Operating income before management fee…..…...		11,281			20,617			82.8

Investment income……………………………….		10,355			17,359			67.6
Interest expense………………………………….		(3,394	)		(3,329	)		(1.9	)
Other income (expense), net……………………..		6,961			14,030			101.6

Income before management fee, income taxes and minority interest.………………………………		18,242			34,647			89.9
Management fee………………………………..		1,818			3,449
Income before income taxes and minority interest		16,424			31,198
Income taxes……….…………………………..		7,360			12,856
Minority interest………………………………..		119			345
Net income………………………………………..	$	8,945		$	17,997			101.2

Net income per share:
Basic…………………………………………….	$	0.31		$	0.64			103.7

Diluted……………………………………………	$	0.31		$	0.63			101.4

Weighted average shares outstanding:
Basic……………………………………………..		28,507			28,160			(1.2	)

Diluted……………………………………………		29,496			29,147			(1.2	)

Reconciliation of Non-GAAP Financial Measures to GAAP:
Operating income before management fee..………..	$	11,281		$	20,617			82.8
Deduct: management fee.………………………….		1,818			3,449
Operating income…………………………………..	$	9,463		$	17,168			81.5
Operating margin before management fee…………		18.3	%		30.2	%
Operating margin after management fee…………		15.3	%		25.1	%

(a) As restated to reflect the reversal of certain previously-accrued expenses for compensation in investment partnerships.

Table V

GAMCO INVESTORS, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(dollars in thousands, except per share data)

	For the Six Months Ended June 30,
	2006 (a)(b)			Adjust- ments(c)			2006 (b)(d)			2007 (d)			D 2007(d) - 2006(b)(d)			%			D 2007(d) - 2006(a)(b)			%

Revenues……………………………...	$	121,906		$	(963	)	$	120,943		$	134,883		$	13,940			11.5	%	$	12,977			10.6	%
Expenses……………………………....		87,571			189			87,760			90,354			2,594			3.0			2,783			3.2

Operating income before management fee…..….……………….		34,335			(1,152	)		33,183			44,529			11,346			34.2			10,194			29.7

Investment income…………………..		24,756			15,097			39,853			30,931			(8,922	)		(22.4	)		6,175			24.9
Interest expense………………………		(6,678	)		(591	)		(7,269	)		(6,709	)		560			(7.7	)		(31	)		0.5
Other income (expense), net…….......		18,078			14,506			32,584			24,222			(8,362	)		(25.7	)		6,144			34.0

Income before management fee, income taxes and minority interest………………………….……..		52,413			13,354			65,767			68,751			2,984			4.5			16,338			31.2
Management fee…………………….		5,235			-			5,235			6,850			1,615						1,615
Income before income taxes and minority interest		47,178			13,354			60,532			61,901			1,369						14,723
Income taxes……….……………….		18,893			5,008			23,901			24,063			162						5,170
Minority interest……………………		381			8,346			8,727			677			(8,050	)					296
Net income……………………………	$	27,904		$	-		$	27,904		$	37,161		$	9,257			33.2		$	9,257			33.2

Net income per share:
Basic…………………………………	$	0.97		$	-		$	0.97		$	1.32		$	0.35			36.2		$	0.35			36.2

Diluted……………………………….	$	0.96		$	-		$	0.96		$	1.30		$	0.34			35.9		$	0.34			35.9

Weighted average shares outstanding:
Basic…………………………………		28,842						28,842			28,194			(648	)		(2.2	)		(648	)		(2.2	)

Diluted………………………………		29,838						29,838			29,172			(666	)		(2.2	)		(666	)		(2.2	)
Reconciliation of Non-GAAP Financial Measures to GAAP:
Operating income before management fee..………………………………..	$	34,335					$	33,183		$	44,529
Deduct: management fee.…………		5,235						5,235			6,850
Operating income…………………….	$	29,100					$	27,948		$	37,679
Operating margin before management fee……………………..		28.2	%					27.4	%		33.0	%
Operating margin after management fee…………………………………..		23.9	%					23.1	%		27.9	%

(a) Final results before adjustments relating to FIN 46R and EITF 04-5 – not GAAP.

(b)	As restated to reflect the reversal of certain previously-accrued expenses for compensation in investment partnerships.

(d) GAAP basis.

Table VI

GAMCO INVESTORS, INC.

UNAUDITED QUARTERLY CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(dollars in thousands, except per share data)

	2006																		2007
	1^{st *}			2^{nd *}						3^{rd *}			4^{th *}						1^st			2^nd
	Quarter			Quarter						Quarter			Quarter			Total			Quarter			Quarter			Total
Income Statement Data:

Revenues	$	59,284		$	61,659		$	57,994		$	82,526		$	261,463		$	66,606		$	68,277		$	134,883

Expenses		37,381			50,378			36,439			47,682			171,880			42,694			47,660			90,354

Operating income before management fee		21,903			11,281			21,555			34,844			89,583			23,912			20,617			44,529


Investment income		29,498			10,355			12,328			18,938			71,119			13,572			17,359			30,931
Interest expense		(3,875	)		(3,394	)		(3,368	)		(3,589	)		(14,226	)		(3,380	)		(3,329	)		(6,709	)
Other income (expense), net		25,623			6,961			8,960			15,349			56,893			10,192			14,030			24,222

Income before management fee, income taxes and minority interest		47,526			18,242			30,515			50,193			146,476			34,104			34,647			68,751

Management fee		3,417			1,818			3,058			4,943			13,236			3,401			3,449			6,850

Income before income taxes and minority interest		44,109			16,424			27,457			45,250			133,240			30,703			31,198			61,901

Income taxes		16,541			7,360			10,296			16,651			50,848			11,207			12,856			24,063
Minority interest		8,608			119			118			1,620			10,465			332			345			677

Net income	$	18,960		$	8,945		$	17,043		$	26,979		$	71,927		$	19,164		$	17,997		$	37,161

Net income per share:
Basic	$	0.65		$	0.31		$	0.60		$	0.96		$	2.52		$	0.68		$	0.64		$	1.32

Diluted	$	0.64		$	0.31		$	0.60		$	0.94		$	2.49		$	0.67		$	0.63		$	1.30

Weighted average shares outstanding:
Basic		29,180			28,507			28,254			28,240			28,542			28,228			28,160			28,194

Diluted		30,185			29,496			29,235			29,208			29,525			29,196			29,147			29,172

Reconciliation of Non-GAAP
Financial measures to GAAP:
Operating income before management fee	$	21,903		$	11,281		$	21,555		$	34,844		$	89,583		$	23,912		$	20,617		$	44,529
Deduct: management fee		3,417			1,818			3,058			4,943			13,236			3,401			3,449			6,850
Operating income	$	18,486		$	9,463		$	18,497		$	29,901		$	76,347		$	20,511		$	17,168		$	37,679
Operating margin before management fee		36.9	%		18.3	%		37.2	%		42.2	%		34.3	%		35.9	%		30.2	%		33.0	%
Operating margin after management fee		31.2	%		15.3	%		31.9	%		36.2	%		29.2	%		30.8	%		25.1	%		27.9	%

* As restated to reflect the reversal of certain previously-accrued expenses for compensation in investment partnerships.

Table VII

GAMCO INVESTORS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

(dollars in thousands, except per share data)


	December 31,		June 30,		June 30,
	2006 (a)		2006 (a)		2007
ASSETS			(unaudited)		(unaudited)

Cash and cash equivalents………………………………………………	$	138,113	$	116,852	$	104,726
Investments …...………………………………………………………...		589,495		549,808		620,142
Receivables……………………………………………………………...		96,942		61,262		69,157
Other assets……………………………………………………………...		12,681		12,364		12,046

Total assets…………………………………………………………...	$	837,231	$	740,286	$	806,071

LIABILITIES AND STOCKHOLDERS' EQUITY

Compensation payable…………………………………………………..	$	30,174	$	34,366	$	46,075
Income taxes payable……………………………………………………		13,922		2,556		14,951
Accrued expenses and other liabilities…………………………………..		88,423		48,890		90,250
Total operating liabilities…………………………………………….		132,519		85,812		151,276
5.5% Senior notes (due May 15, 2013) ……………….….……………		100,000		100,000		100,000
6% Convertible note, $50 million outstanding (due August 14, 2011)(b)		49,504		50,000		49,561
5.22% Senior notes (due February 17, 2007)………….….……………..		82,308		82,308		-
Total debt…………………………………………………………….		231,812		232,308		149,561
Total Liabilities……………………………………………………...		364,331		318,120		300,837

Minority interest…………………………………………………………		21,324		19,724		14,441

Stockholders' equity……………………………………………………..		451,576		402,442		490,793

Total liabilities and stockholders' equity………………………………...	$	837,231	$	740,286	$	806,071

(a)	As restated to reflect the reversal of certain previously-accrued expenses for compensation in investment partnerships.

(b)	At June 30, 2007 and December 31, 2006, the conversion price was $53 per share. At June 30, 2006, the convertible note was 5% with a conversion price of $52 per share.

New York	1-14761	13-4007862
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

One Corporate Center, Rye, NY		10580
(Address of principal executive offices)		(Zip Code)

GAMCO Investors, Inc.

By:		/s/ Kieran Caterina
		Kieran Caterina Acting co-Chief Financial Officer



By:		/s/ Diane M. LaPointe
		Diane M. LaPointe Acting co-Chief Financial Officer