Delaware | 001-34516 | 27-0423711 | ||
(State or Other Jurisdiction of Incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
(d) | Exhibit | |
99.1 | Press Release issued by the Company dated August 3, 2017 |
COWEN INC. | ||||
By: | /s/ Owen S. Littman | |||
Name: | Owen S. Littman | |||
Date: | August 3, 2017 | Title: | General Counsel | |
• | GAAP revenue of $160.5 million compared to $117.2 million in the prior year period. |
• | GAAP net income attributable to common shareholders of $5.7 million or $0.19 per diluted common share, compared to a GAAP net loss attributable to common shareholders of $12.2 million or $(0.45) per diluted common share in the prior year period. |
• | Economic revenue, a non-GAAP measure, of $171.9 million compared to $80.4 million in the prior year period. |
• | Economic income, a non-GAAP measure, available to Cowen of $11.5 million or $0.39 per diluted share, compared to an economic income loss of $22.0 million or $(0.82) per diluted share in the second quarter 2016. |
• | Investment banking revenue grew 82% year over year on both a GAAP and economic income (non-GAAP) basis. Revenue was driven by strong performance in equity capital markets. |
• | Brokerage revenue increased 36% and 37% year over year, on a GAAP and economic income (non-GAAP) basis, respectively, and included contributions from the businesses acquired from Convergex. |
• | As of July 1, 2017, assets under management were $11.0 billion, an increase of $286 million from April 1, 2017. |
• | Book value per share was $23.58 as of June 30, 2017, compared to $25.11 as of December 31, 2016. The decrease was primarily due to the shares issued in conjunction with the Convergex acquisition. |
• | Tangible book value per share was $20.55 as of June 30, 2017 compared to $21.88 as of December 31, 2016. The decrease was primarily due to the shares issued in conjunction with the Convergex acquisition. |
• | On June 1, 2017, the Company completed the previously announced acquisition of Convergex Group, LLC ("Convergex"), a leading agency-focused global brokerage and trading related services provider. |
(Dollar amounts in millions, except per share information) | Three Months Ended | Six Months Ended | ||||||||||||||||||||||||||
June 30, | Mar. 31, | June 30, | ||||||||||||||||||||||||||
2017 | 2016 | % | 2017 | % | 2017 | 2016 | % | |||||||||||||||||||||
Revenue | $ | 160.5 | $ | 117.2 | 37 | % | $ | 115.0 | 40 | % | $ | 275.5 | $ | 218.3 | 26 | % | ||||||||||||
Net income (loss) attributable to Cowen | $ | 7.4 | $ | (10.5 | ) | NM | $ | 3.0 | NM | $ | 10.4 | $ | (14.2 | ) | NM | |||||||||||||
Preferred stock dividends | $ | 1.7 | $ | 1.7 | — | % | $ | 1.7 | — | % | $ | 3.4 | $ | 3.4 | — | % | ||||||||||||
Net income (loss) attributable to Cowen common stockholders | $ | 5.7 | $ | (12.2 | ) | NM | $ | 1.3 | NM | $ | 7.0 | $ | (17.6 | ) | NM | |||||||||||||
Earnings (loss) per share (diluted) | $0.19 | $(0.45) | NM | $0.05 | NM | $ | 0.24 | $ | (0.66 | ) | NM | |||||||||||||||||
Note: Amounts may not add due to rounding. |
(Amounts in millions, except per share information) | June 30, | Dec. 31, | June 30, | |||||
2017 | 2016 | 2016 | ||||||
Cowen Inc. stockholders' equity | $833.9 | $772.7 | $770.2 | |||||
Common equity (CE) | $732.6 | $671.3 | $668.8 | |||||
Tangible common equity (TCE) | $638.5 | $584.9 | $578.6 | |||||
Book value per share (CE/CSO) | $23.58 | $25.11 | $24.96 | |||||
Tangible book value (TCE/CSO) | $20.55 | $21.88 | $21.59 | |||||
Common shares outstanding (CSO) | 31.1 | 26.7 | 26.8 | |||||
Reconciliation of GAAP Cowen Inc. stockholders' equity to tangible common equity: | ||||||||
Cowen Inc. stockholders' equity | $833.9 | $772.7 | $770.2 | |||||
Less: | ||||||||
Preferred stock | 101.3 | 101.3 | 101.3 | |||||
Common equity (CE) | $732.6 | $671.3 | $668.8 | |||||
Less: | ||||||||
Goodwill & intangibles | 94.1 | 86.4 | 90.3 | |||||
Tangible common equity (TCE) | $638.5 | $584.9 | $578.6 |
(Dollar amounts in millions, except per share information) | Three Months Ended | Six Months Ended | ||||||||||||||||||||||||||
June 30, | Mar. 31, | June 30, | ||||||||||||||||||||||||||
2017 | 2016 | % | 2017 | % | 2017 | 2016 | % | |||||||||||||||||||||
Revenue | $ | 171.9 | $ | 80.4 | 114 | % | $ | 128.6 | 34 | % | $ | 300.5 | $ | 186.0 | 62 | % | ||||||||||||
Economic Income (Loss) | $ | 11.5 | $ | (22.0 | ) | NM | $ | 5.5 | 112 | % | $ | 17.0 | $ | (26.9 | ) | NM | ||||||||||||
Economic Income (Loss) per share (diluted) | $ | 0.39 | $ | (0.82 | ) | NM | $ | 0.19 | 104 | % | $ | 0.59 | $ | (1.01 | ) | (159 | )% | |||||||||||
Note: Amounts may not add due to rounding. |
Three Months Ended | Six Months Ended | ||||||||||||||||||
June 30, | Mar. 31, | June 30, | |||||||||||||||||
(Per share information) | 2017 | 2016 | 2017 | 2017 | 2016 | ||||||||||||||
Economic Income (Loss) per share (diluted) | $ | 0.39 | $ | (0.82 | ) | $ | 0.19 | $ | 0.59 | $ | (1.01 | ) | |||||||
Adjustments: | |||||||||||||||||||
Preferred dividends | (0.06 | ) | (0.06 | ) | (0.06 | ) | (0.12 | ) | (0.13 | ) | |||||||||
Taxes | 0.03 | 0.45 | (0.07 | ) | (0.04 | ) | 0.57 | ||||||||||||
Bargain purchase gain | (0.27 | ) | — | — | (0.27 | ) | — | ||||||||||||
Transaction-related costs | 0.10 | (0.02 | ) | (0.02 | ) | (0.19 | ) | (0.10 | ) | ||||||||||
GAAP earnings (loss) per share (diluted) | $ | 0.19 | $ | (0.45 | ) | $ | 0.05 | $ | 0.24 | $ | (0.66 | ) | |||||||
Note: Amounts may not add due to rounding. |
Three Months Ended | Six Months Ended | |||||||||||||||||||||||||||
June 30, | Mar. 31, | June 30, | ||||||||||||||||||||||||||
(Dollar amounts in millions) | 2017 | 2016 | % | 2017 | % | 2017 | 2016 | % | ||||||||||||||||||||
Investment banking | $ | 64.1 | $ | 35.3 | 82 | % | $ | 36.6 | 75 | % | $ | 100.7 | 61.4 | 64 | % | |||||||||||||
Brokerage | 67.0 | 49.0 | 37 | % | 52.3 | 28 | % | 119.3 | 101.9 | 17 | % | |||||||||||||||||
Management fees | 14.4 | 16.5 | (13 | )% | 13.9 | 3 | % | 28.3 | 33.4 | (15 | )% | |||||||||||||||||
Incentive income | 11.0 | 0.4 | NM | 3.1 | 258 | % | 14.0 | 7.3 | 91 | % | ||||||||||||||||||
Investment income (loss) | 14.2 | (22.2 | ) | NM | 21.6 | (34 | )% | 35.8 | (20.3 | ) | NM | |||||||||||||||||
Other revenues | 1.3 | 1.3 | (4 | )% | 1.1 | 15 | % | 2.4 | 2.3 | 4 | % | |||||||||||||||||
Total Revenue | $ | 171.9 | $ | 80.4 | 114 | % | $ | 128.6 | 34 | % | $ | 300.5 | $ | 186.0 | 62 | % | ||||||||||||
Note: Amounts may not add due to rounding. |
Three Months Ended | Six Months Ended | ||||||||||
June 30, | June 30, | ||||||||||
(Dollar amounts in millions) | 2017 | 2016 | 2017 | 2016 | |||||||
Equity Underwriting | $56.1 | $25.6 | $88.2 | $48.3 | |||||||
Debt Underwriting | — | 0.1 | (0.1 | ) | 2.4 | ||||||
Advisory | 8.0 | 9.6 | 12.5 | 10.8 | |||||||
Total | $64.1 | $35.3 | $100.7 | $61.4 |
Three Months Ended | Six Months Ended | ||||||
June 30, | June 30, | ||||||
2017 | 2016 | 2017 | 2016 | ||||
Equity Underwriting | 31 | 21 | 54 | 33 | |||
Of which bookrun: | 18 | 14 | 32 | 20 | |||
Debt Underwriting | — | 1 | — | 3 | |||
Advisory | 2 | 4 | 4 | 4 | |||
Total | 33 | 26 | 58 | 40 |
Cowen Inc. | |||||||||||||||
GAAP Preliminary Unaudited Condensed Consolidated Statements of Operations | |||||||||||||||
(Dollar amounts in thousands, except per share data) | |||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||
June 30, | June 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Revenue | |||||||||||||||
Investment banking | $ | 64,146 | $ | 35,287 | $ | 100,699 | $ | 61,434 | |||||||
Brokerage | 63,845 | 47,100 | 114,379 | 98,035 | |||||||||||
Management fees | 8,656 | 10,649 | 17,364 | 21,679 | |||||||||||
Incentive income | 3,726 | 428 | 4,272 | 1,539 | |||||||||||
Interest and dividends | 7,917 | 4,105 | 13,006 | 7,758 | |||||||||||
Reimbursement from affiliates | 495 | 2,241 | 2,147 | 6,128 | |||||||||||
Aircraft lease revenue | 1,043 | 1,588 | 2,102 | 1,982 | |||||||||||
Reinsurance premiums | 7,682 | 13,328 | 14,771 | 14,338 | |||||||||||
Other | 1,345 | 412 | 2,745 | 1,733 | |||||||||||
Consolidated Funds | |||||||||||||||
Interest and dividends | 1,388 | 1,538 | 3,382 | 2,614 | |||||||||||
Other | 287 | 555 | 634 | 1,030 | |||||||||||
Total revenue | 160,530 | 117,231 | 275,501 | 218,270 | |||||||||||
Expenses | |||||||||||||||
Employee compensation and benefits | 102,111 | 55,627 | 178,784 | 118,808 | |||||||||||
Interest and dividends | 12,211 | 6,944 | 22,141 | 14,254 | |||||||||||
Operating, general, administrative and other expenses | 53,990 | 37,833 | 93,591 | 77,835 | |||||||||||
Depreciation and amortization expense | 3,132 | 3,413 | 6,160 | 6,480 | |||||||||||
Reinsurance claims, commissions and amortization of deferred acquisition costs | 7,275 | 11,766 | 13,453 | 12,329 | |||||||||||
Restructuring costs | 8,541 | — | 8,541 | — | |||||||||||
Consolidated Funds expenses | 2,748 | 2,143 | 7,711 | 3,959 | |||||||||||
Total expenses | 190,008 | 117,726 | 330,381 | 233,665 | |||||||||||
Other income (loss) | |||||||||||||||
Net (losses) gains on securities, derivatives and other investments | 18,719 | (20,218 | ) | 44,775 | (17,030 | ) | |||||||||
Bargain purchase gain | 7,946 | — | 7,946 | — | |||||||||||
Consolidated Funds net (losses) gains | 30,613 | (18,440 | ) | 43,959 | (18,043 | ) | |||||||||
Total other income (loss) | 57,278 | (38,658 | ) | 96,680 | (35,073 | ) | |||||||||
Income (loss) before income taxes | 27,800 | (39,153 | ) | 41,800 | (50,468 | ) | |||||||||
Income tax expense/(benefit) | (785 | ) | (11,992 | ) | 1,126 | (15,312 | ) | ||||||||
Net income (loss) | 28,585 | (27,161 | ) | 40,674 | (35,156 | ) | |||||||||
Net income (loss) attributable to redeemable non-controlling interests in consolidated subsidiaries and funds | 21,145 | (16,705 | ) | 30,250 | (21,002 | ) | |||||||||
Net income (loss) attributable to Cowen Inc. | 7,440 | (10,456 | ) | 10,424 | (14,154 | ) | |||||||||
Preferred stock dividends | 1,698 | 1,698 | 3,396 | 3,396 | |||||||||||
Net income (loss) attributable to Cowen Inc. common stockholders | $ | 5,742 | $ | (12,154 | ) | $ | 7,028 | $ | (17,550 | ) | |||||
Earnings (loss) per share: | |||||||||||||||
Basic | $ | 0.20 | $ | (0.45 | ) | $ | 0.25 | $ | (0.66 | ) | |||||
Diluted | $ | 0.19 | $ | (0.45 | ) | $ | 0.24 | $ | (0.66 | ) | |||||
Weighted average shares used in per share data: | |||||||||||||||
Basic | 28,634 | 26,867 | 27,852 | 26,729 | |||||||||||
Diluted | 29,474 | 26,867 | 28,860 | 26,729 |
Cowen Inc. | |||||||||||||||
Unaudited Reconciliation of GAAP and Economic Revenue for the Three Months Ended June 30, 2017 | |||||||||||||||
(Dollar amounts in thousands) | |||||||||||||||
Three Months Ended June 30, 2017 | |||||||||||||||
Adjustments | |||||||||||||||
Other | Funds | Economic | |||||||||||||
GAAP | Adjustments (1) | Consolidation (2) | Income | ||||||||||||
Revenue | |||||||||||||||
Investment banking | $ | 64,146 | $ | — | $ | — | $ | 64,146 | |||||||
Brokerage | 63,845 | 3,148 | (f) | — | 66,993 | ||||||||||
Management fees | 8,656 | 5,094 | (a) | 605 | 14,355 | ||||||||||
Incentive income | 3,726 | 4,464 | (a) | 2,779 | 10,969 | ||||||||||
Investment income | — | 14,192 | (b)(d) | — | 14,192 | ||||||||||
Interest and dividends | 7,917 | (7,917 | ) | (b) | — | — | |||||||||
Reimbursement from affiliates | 495 | (570 | ) | (c) | 75 | — | |||||||||
Aircraft lease revenue | 1,043 | (1,043 | ) | (d) | — | — | |||||||||
Reinsurance premiums | 7,682 | (7,682 | ) | (e) | — | — | |||||||||
Other revenues | 1,345 | (72 | ) | (e) | — | 1,273 | |||||||||
Consolidated Funds | 1,675 | — | (1,675 | ) | — | ||||||||||
Total revenue | $ | 160,530 | $ | 9,614 | $ | 1,784 | $ | 171,928 | |||||||
Note: The following is a summary of the adjustments made to US GAAP revenue to Economic Income revenue: | |||||||||||||||
(1) Other adjustments include reclassifications between other income (loss), redeemable non-controlling interests and interest and non-interest expenses based on the nature of the respective line item | |||||||||||||||
(2) Fund consolidation includes the impact of consolidation. The related elimination entries of the Consolidated Funds are not included in Economic Income. Adjustments include elimination of incentive income and management fees earned from the Consolidated Funds. | |||||||||||||||
Other Adjustments: | |||||||||||||||
(a) Economic Income (Loss) recognizes revenues (i) net of distribution fees paid to agents and (ii) our proportionate share of management and incentive fees of certain real estate operating entities, the healthcare royalty business and the activist business. | |||||||||||||||
(b) Economic Income (Loss) recognizes Company income from proprietary trading (including interest and dividends). | |||||||||||||||
(c) Reimbursement from affiliates is shown as a reduction of Economic Income expenses, but is included as a part of revenues under US GAAP. | |||||||||||||||
(d) Aircraft lease revenue is shown net of expenses in investment income for Economic Income (Loss). | |||||||||||||||
(e) Economic Income (Loss) recognizes underwriting income from the Company's insurance related activities, net of expenses, within other revenue. | |||||||||||||||
(f) Economic Income (Loss) brokerage revenues included net securities borrowed and securities loaned activities. |
Cowen Inc. | |||||||||||||||
Unaudited Reconciliation of GAAP and Economic Revenue for the Three Months Ended June 30, 2016 | |||||||||||||||
(Dollar amounts in thousands) | |||||||||||||||
Three Months Ended June 30, 2016 | |||||||||||||||
Adjustments | |||||||||||||||
Other | Funds | Economic | |||||||||||||
GAAP | Adjustments (1) | Consolidation (2) | Income | ||||||||||||
Revenue | |||||||||||||||
Investment banking | $ | 35,287 | $ | — | $ | — | $ | 35,287 | |||||||
Brokerage | 47,100 | 1,926 | (f) | — | 49,026 | ||||||||||
Management fees | 10,649 | 5,422 | (a) | 424 | 16,495 | ||||||||||
Incentive income | 428 | 151 | (a) | (150 | ) | 429 | |||||||||
Investment income | — | (22,171 | ) | (b)(d) | — | (22,171 | ) | ||||||||
Interest and dividends | 4,105 | (4,105 | ) | (b) | — | — | |||||||||
Reimbursement from affiliates | 2,241 | (2,375 | ) | (c) | 134 | — | |||||||||
Aircraft lease revenue | 1,588 | (1,588 | ) | (d) | — | — | |||||||||
Reinsurance premiums | 13,328 | (13,328 | ) | (e) | — | — | |||||||||
Other revenues | 412 | 916 | (e) | — | 1,328 | ||||||||||
Consolidated Funds | 2,093 | — | (2,093 | ) | — | ||||||||||
Total revenue | $ | 117,231 | $ | (35,152 | ) | $ | (1,685 | ) | $ | 80,394 | |||||
Note: The following is a summary of the adjustments made to US GAAP revenue to Economic Income revenue: | |||||||||||||||
(1) Other adjustments include reclassifications between other income (loss), redeemable non-controlling interests and interest and non-interest expenses based on the nature of the respective line item | |||||||||||||||
(2) Fund consolidation includes the impact of consolidation. The related elimination entries of the Consolidated Funds are not included in Economic Income. Adjustments include elimination of incentive income and management fees earned from the Consolidated Funds. | |||||||||||||||
Other Adjustments: | |||||||||||||||
(a) Economic Income (Loss) recognizes revenues (i) net of distribution fees paid to agents and (ii) our proportionate share of management and incentive fees of certain real estate operating entities, the healthcare royalty business and the activist business. | |||||||||||||||
(b) Economic Income (Loss) recognizes Company income from proprietary trading (including interest and dividends). | |||||||||||||||
(c) Reimbursement from affiliates is shown as a reduction of Economic Income expenses, but is included as a part of revenues under US GAAP. | |||||||||||||||
(d) Aircraft lease revenue is shown net of expenses in investment income for Economic Income (Loss). | |||||||||||||||
(e) Economic Income (Loss) recognizes underwriting income from the Company's insurance related activities, net of expenses, within other revenue. | |||||||||||||||
(f) Economic Income (Loss) brokerage revenues included net securities borrowed and securities loaned activities. |
Cowen Inc. | |||||||||||||||
Unaudited Reconciliation of GAAP and Economic Revenue for the Six Months Ended June 30, 2017 | |||||||||||||||
(Dollar amounts in thousands) | |||||||||||||||
Six Months Ended June 30, 2017 | |||||||||||||||
Adjustments | |||||||||||||||
Other | Funds | Economic | |||||||||||||
GAAP | Adjustments (1) | Consolidation (2) | Income | ||||||||||||
Revenue | |||||||||||||||
Investment banking | $ | 100,699 | $ | — | $ | — | $ | 100,699 | |||||||
Brokerage | 114,379 | 4,927 | (f) | — | 119,306 | ||||||||||
Management fees | 17,364 | 9,805 | (a) | 1,133 | 28,302 | ||||||||||
Incentive income | 4,272 | 6,490 | (a) | 3,267 | 14,029 | ||||||||||
Investment income | — | 35,816 | (b)(d) | — | 35,816 | ||||||||||
Interest and dividends | 13,006 | (13,006 | ) | (b) | — | — | |||||||||
Reimbursement from affiliates | 2,147 | (2,300 | ) | (c) | 153 | — | |||||||||
Aircraft lease revenue | 2,102 | (2,102 | ) | (d) | — | — | |||||||||
Reinsurance premiums | 14,771 | (14,771 | ) | (e) | — | — | |||||||||
Other revenues | 2,745 | (367 | ) | (e) | — | 2,378 | |||||||||
Consolidated Funds | 4,016 | — | (4,016 | ) | — | ||||||||||
Total revenue | $ | 275,501 | $ | 24,492 | $ | 537 | $ | 300,530 | |||||||
Note: The following is a summary of the adjustments made to US GAAP revenue to Economic Income revenue: | |||||||||||||||
(1) Other adjustments include reclassifications between other income (loss), redeemable non-controlling interests and interest and non-interest expenses based on the nature of the respective line item | |||||||||||||||
(2) Fund consolidation includes the impact of consolidation. The related elimination entries of the Consolidated Funds are not included in Economic Income. Adjustments include elimination of incentive income and management fees earned from the Consolidated Funds. | |||||||||||||||
Other Adjustments: | |||||||||||||||
(a) Economic Income (Loss) recognizes revenues (i) net of distribution fees paid to agents and (ii) our proportionate share of management and incentive fees of certain real estate operating entities, the healthcare royalty business and the activist business. | |||||||||||||||
(b) Economic Income (Loss) recognizes Company income from proprietary trading (including interest and dividends). | |||||||||||||||
(c) Reimbursement from affiliates is shown as a reduction of Economic Income expenses, but is included as a part of revenues under US GAAP. | |||||||||||||||
(d) Aircraft lease revenue is shown net of expenses in investment income for Economic Income (Loss). | |||||||||||||||
(e) Economic Income (Loss) recognizes underwriting income from the Company's insurance related activities, net of expenses, within other revenue. | |||||||||||||||
(f) Economic Income (Loss) brokerage revenues included net securities borrowed and securities loaned activities. |
Cowen Inc. | |||||||||||||||
Unaudited Reconciliation of GAAP and Economic Revenue for the Six Months Ended June 30, 2016 | |||||||||||||||
(Dollar amounts in thousands) | |||||||||||||||
Six Months Ended June 30, 2016 | |||||||||||||||
Adjustments | |||||||||||||||
Other | Funds | Economic | |||||||||||||
GAAP | Adjustments (1) | Consolidation (2) | Income | ||||||||||||
Revenue | |||||||||||||||
Investment banking | $ | 61,434 | $ | — | $ | — | $ | 61,434 | |||||||
Brokerage | 98,035 | 3,858 | (f) | — | 101,893 | ||||||||||
Management fees | 21,679 | 10,926 | (a) | 794 | 33,399 | ||||||||||
Incentive income | 1,539 | 5,803 | (a) | 7 | 7,349 | ||||||||||
Investment income | — | (20,322 | ) | (b)(d) | — | (20,322 | ) | ||||||||
Interest and dividends | 7,758 | (7,758 | ) | (b) | — | — | |||||||||
Reimbursement from affiliates | 6,128 | (6,276 | ) | (c) | 148 | — | |||||||||
Aircraft lease revenue | 1,982 | (1,982 | ) | (d) | — | — | |||||||||
Reinsurance premiums | 14,338 | (14,338 | ) | (e) | — | — | |||||||||
Other revenues | 1,733 | 548 | (e) | — | 2,281 | ||||||||||
Consolidated Funds | 3,644 | — | (3,644 | ) | — | ||||||||||
Total revenue | $ | 218,270 | $ | (29,541 | ) | $ | (2,695 | ) | $ | 186,034 | |||||
Note: The following is a summary of the adjustments made to US GAAP revenue to Economic Income revenue: | |||||||||||||||
(1) Other adjustments include reclassifications between other income (loss), redeemable non-controlling interests and interest and non-interest expenses based on the nature of the respective line item | |||||||||||||||
(2) Fund consolidation includes the impact of consolidation. The related elimination entries of the Consolidated Funds are not included in Economic Income. Adjustments include elimination of incentive income and management fees earned from the Consolidated Funds. | |||||||||||||||
Other Adjustments: | |||||||||||||||
(a) Economic Income (Loss) recognizes revenues (i) net of distribution fees paid to agents and (ii) our proportionate share of management and incentive fees of certain real estate operating entities and the activist business. | |||||||||||||||
(b) Economic Income (Loss) recognizes Company income from proprietary trading (including interest and dividends). | |||||||||||||||
(c) Reimbursement from affiliates is shown as a reduction of Economic Income expenses, but is included as a part of revenues under US GAAP. | |||||||||||||||
(d) Aircraft lease revenue is shown net of expenses in investment income for Economic Income (Loss). | |||||||||||||||
(e) Economic Income (Loss) recognizes underwriting income from the Company's insurance related activities, net of expenses, within other revenue. | |||||||||||||||
(f) Economic Income (Loss) brokerage revenues included net securities borrowed and securities loaned activities. |
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