EX-99 2 a5944164ex99.htm EXHIBIT 99

Exhibit 99

Jefferies Reports First Quarter Earnings Per Common Share of $0.19

NEW YORK--(BUSINESS WIRE)--April 21, 2009--Jefferies Group, Inc. (NYSE: JEF) today announced financial results for the first quarter ended March 31, 2009.

Highlights for the first quarter ended March 31, 2009:

  • Net revenues were $347.3 million.
  • The net earnings for the first quarter of 2009 were $38.3 million.
  • The net earnings per common share (diluted) were $0.19.
  • Fixed income and commodities revenues were a record $203 million.

Richard B. Handler, Chairman and CEO of Jefferies, commented:

“Our first quarter results make it clear that we have distinguished ourselves from both the TARP-subsidized institutions, as well as the small and mid-cap brokers and boutiques. The performance of our fixed income businesses highlights the breadth and depth of our full-service, client-focused, independently-funded Wall Street securities firm. We have invested many years, an immense amount of human effort and much expense to build what we believe is a first tier provider of sales, trading, research and investment banking services. Our first quarter results reflect only the beginning of what we expect to realize over time from this investment. The events of the last 21 months, and particularly the incredible change in the competitive landscape over the last 12 months, have only enhanced the long-term opportunity we envision for our firm. We thank everyone at Jefferies for their efforts.”

Conference Call

A conference call with management discussion of financial results for the first quarter ended March 31, 2009 will be held today, April 21, 2009, at 9:00 AM Eastern (date and time subject to change). Securities industry professionals may access the management discussion by calling 877-246-1929 or 706-634-9290. A one-week replay of the call will also be available at 800-633-8284 or 402-977-9140 (reservation code # 21419001). A live audio webcast and delayed replay can be accessed at www.jefferies.com.

About Jefferies

Jefferies, an independent, full-service 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. The firm provides investors with fundamental research and trade execution in equity, equity-linked, and fixed income securities, including corporate bonds, high yield bonds, US government and agency securities, repo finance, mortgage- and asset-backed securities, municipal bonds, whole loans and emerging markets debt, as well as commodities and derivatives. Jefferies offers companies capital markets, merger and acquisition, restructuring and other financial advisory services. 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
Mar 31, 2009   Mar 31, 2008
Revenues:
Commissions 101,851 113,651
Principal Transactions 152,345 54
Investment Banking 37,086 99,207

Asset Management fees and investment (loss) from managed funds

(37 ) (27,796 )
Interest 102,087 204,891
Other 12,572     6,480  
Total Revenues 405,904 396,487
Interest Expense 63,947     195,291  
Net Revenues 341,957 201,196

Interest on Mandatorily Redeemable Preferred Interest of Consolidated Subsidiaries

(5,303 )   (20,951 )

Net Revenues, less Mandatorily Redeemable Preferred Interest

347,260     222,147  
 
Non-Interest Expenses:
Compensation and benefits 213,381 259,951
Floor brokerage and clearing fees 14,780 12,948
Technology and communications 30,785 30,916
Occupancy and equipment rental 16,296 17,257
Business development 9,445 12,900
Other 13,391     20,481  
Total non-interest expenses 298,078     354,453  
 
Earnings / (loss) before income taxes 49,182 (132,306 )
 
Income tax expense / (benefit) 16,756     (57,892 )
Net earnings / (loss) 32,426 (74,414 )
Net (loss) to Noncontrolling Interests (5,911 )   (13,877 )
Net earnings / (loss) to Common Shareholders 38,337     (60,537 )
Earnings / (loss) per Common Share
Basic $ 0.19     $ (0.45 )
Diluted $ 0.19     $ (0.45 )
 
Weighted Average Common Shares:
Basic 203,310 141,784
Diluted 203,326 141,784
 
Effective tax rate 34 % 44 %
JEFFERIES GROUP, INC. AND SUBSIDIARIES
SELECTED STATISTICAL INFORMATION
(Amounts in Thousands, Except Per Share Amounts)
(Unaudited)
       
Quarters Ended
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

347,260 186,874 298,751 383,080 222,147
 
Non-Interest Expenses:
Compensation and Benefits 213,381 738,506 246,186 277,514 259,951

Non-personnel expenses

84,697     148,136     106,221     100,097     94,502  
Earnings / (loss) before income taxes 49,182 (699,768 ) (53,656 ) 5,469 (132,306 )
 
Income tax expense / (benefit) 16,756     (230,283 )   (6,090 )   4,016     (57,892 )
 
Net earnings / (loss) 32,426 (469,485 ) (47,566 ) 1,453 (74,414 )

Net (loss) / earnings to Noncontrolling Interests

(5,911 )   (29,583 )   (16,262 )   5,838     (13,877 )
 
Net earnings / (loss) to Common Shareholders 38,337     (439,902 )   (31,304 )   (4,385 )   (60,537 )
 

Diluted earnings / (loss) per Common Share

$ 0.19     $ (2.39 )   $ (0.18 )   $ (0.05 )   $ (0.45 )
 

Financial Ratios

Pretax Operating Margin 14 % -374 % -18 % 1 % -60 %

Compensation and Benefits / Net Revenues

62 % 480 % 90 % 71 % 129 %
Effective Tax Rate 34 % 33 % 11 % 73 % 44 %
JEFFERIES GROUP, INC. AND SUBSIDIARIES
SELECTED STATISTICAL INFORMATION
(Amounts in Thousands, Except Per Share Amounts)
(Unaudited)
         
Quarters Ended
3/31/2009   12/31/2008   9/30/2008   6/30/2008   3/31/2008

Revenues by Source

Equities 102,832 87,054 134,853 165,251 142,551
Fixed Income and Commodities 203,344 103,890 72,875 72,763 40,295
High Yield (7,302 ) (89,096 ) (59,776 ) 31,218 (53,061 )
Other 6,034     -     -     -   -  
Total 304,908 101,848 147,952 269,232 129,785
 
Investment banking 37,086 87,184 130,125 109,371 99,207
 

Asset management fees and investment (loss) / income from managed funds:

Asset management fees 3,762 4,765 3,804 4,758 6,285

Investment (loss) / income from managed funds

(3,799 )   (39,946 )   (7,235 )   8,721   (34,081 )
Total (37 )   (35,181 )   (3,431 )   13,479   (27,796 )
Net Revenues 341,957     153,851     274,646     392,082   201,196  
Interest on Mandatorily Redeemable Preferred Interest of Consolidated Subsidiaries (5,303 )   (33,023 )   (24,105 )   9,002   (20,951 )
Net Revenues, less Mandatorily Redeemable Preferred Interest 347,260     186,874     298,751     383,080   222,147  
 

Other Data

Number of Trading Days 61 64 64 64 61
Average Employees 2,243 2,356 2,403 2,327 2,486
Common Shares Outstanding 169,195 163,216 163,429 162,121 132,762
Weighted Average Common Shares:
Basic 203,310 183,691 173,757 165,694 141,784
Diluted 203,326 183,691 173,757 165,694 141,784
 
As of March 31, 2009, common stockholders' equity amounted to $2.1 billion, resulting in book value of $12.23 per common share
JEFFERIES GROUP, INC. AND SUBSIDIARIES
COMMON SHARES OUTSTANDING AND COMMON SHARES FOR BASIC AND DILUTED EPS CALCULATIONS
(Unaudited)
   
March 31, 2009
 
Common shares outstanding 169,194,901
Outstanding restricted stock units 28,240,861  
Adjusted shares outstanding 197,435,762
 

Note - All share information below for EPS purposes is based upon weighted-average balances for the applicable period.

 
Three months ended
March 31, 2009
 
Shares Outstanding (weighted average) (1) 165,029,324
Unearned restricted stock (2) (328,262 )
Earned restricted stock units (3) 29,863,341
Other issuable shares (4) 8,745,680  
Common Shares for Basic EPS 203,310,082
 
Stock Options (5) 16,014

Mandatorily redeemable convertible preferred stock

(6) -

Unearned restricted stock/ restricted stock units

(7) -  
Common Shares for Diluted EPS 203,326,096
 
 

(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)

 

The conversion of our mandatorily redeemable convertible preferred stock is considered anti-dilutive to our first quarter EPS results and not included in Diluted EPS shares. If dilutive, the conversion would be calculated under the if-converted method in accordance with FASB 128, Earnings per Share, and result in 4,105,138 shares. The if-converted method assumes the conversion of convertible securities at the beginning of the period.
 

(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