☰

Empresas y finanzas

Jefferies Reports Record Fiscal Fourth-Quarter 2013 Financial Results


    Jefferies Group LLC today announced financial results for its fiscal fourth quarter 2013.

    Highlights for the three months ended November 30, 2013:

    • Net revenues of $936 million
    • Net earnings of $120 million
    • Investment banking net revenues of $417 million
    • Equities net revenues of $294 million
    • Fixed Income net revenues of $212 million

    Richard B. Handler, Chairman and Chief Executive Officer of Jefferies, commented: “Our results reflect exceptional quarterly performance in our investment banking efforts, a solid performance from our core global equity businesses, and a very significant improvement in our fixed income results versus the third-quarter. Our investment banking performance benefited from a strong equities and leveraged finance new issues market and demonstrates our significant market presence and value added capabilities. Our equities results include the impact of $110 million in pre-tax unrealized mark-to-market gains on our holdings of shares of Knight Capital and Harbinger Group. Fixed income customer flows improved significantly from last quarter. While our results for the full fiscal year 2013 were below those of 2012, primarily due to the difficult mid-year fixed income environment, we believe the strong finish to the year, combined with the continued positive momentum in all of our core businesses, positions us well for 2014. We thank our clients, our employees, our bondholders and all our business partners for their continued support.”

    The financial tables attached should be read in connection with our Quarterly Report on Form 10-Q for the quarter ended August 31, 2013 and our Annual Report on Form 10-K for the year ended November 30, 2012.

    Jefferies, the global investment banking firm focused on serving clients for over 50 years, is a leader in providing insight, expertise and execution to investors, companies and governments. The firm provides a full range of investment banking, sales, trading, research and strategy across the spectrum of equities, fixed income, foreign exchange, futures and commodities, and also select asset and wealth management strategies, in the Americas, Europe and Asia. Jefferies Group LLC is a wholly-owned subsidiary of Leucadia National Corporation (NYSE: LUK), a diversified holding company.

                              JEFFERIES GROUP LLC AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF EARNINGS (Amounts in Thousands) (Unaudited)                                 Successor     Predecessor       Quarter Ended     Quarter Ended     Quarter Ended       November 30, 2013     August 31, 2013     November 30, 2012                           Revenues:                         Commissions    

    $

     

    141,594

       

    $

     

    138,736

       

    $

     

    127,074

    Principal transactions         289,430         (24,910)         242,140 Investment banking         417,044         309,339         282,962 Asset management fees and

    investment income from managed funds

            12,017         13,549         16,318 Interest income         224,911         230,672         242,904 Other revenues         39,320         28,630         61,872 Total revenues         1,124,316         696,016         973,270 Interest expense         188,609         178,987         204,421 Net revenues         935,707         517,029         768,849 Interest on mandatorily redeemable preferred interests of

    consolidated subsidiaries

            -         -         8,279 Net revenues, less interest on mandatorily redeemable preferred

    interests of consolidated subsidiaries

            935,707         517,029         760,570                           Non-interest expenses:                         Compensation and benefits         546,257         293,771         460,404           546,332                 Non-compensation expenses:                         Floor brokerage and clearing fees         37,866         34,500         29,106 Technology and communications         67,578         62,266         64,051 Occupancy and equipment rental         28,270         26,205         25,815 Business development         22,759         17,624         22,968 Professional services         18,014         25,269         27,771 Other         23,593         34,012         16,480 Total non-compensation expenses         198,080         199,876         186,191 Total non-interest expenses         744,337         493,647         646,595 Earnings before income taxes         191,370         23,382         113,975 Income tax expense         66,785         8,493         34,243 Net earnings         124,585         14,889         79,732 Net earnings attributable to noncontrolling interests (A)         4,531         3,149         8,128 Net earnings attributable to Jefferies Group LLC/ common shareholders    

    $

     

    120,054

       

    $

     

    11,740

       

    $

     

    71,604

                              Compensation and benefits / Net revenues         58.4%         56.8%         59.9%                           Effective tax rate         34.9%         36.3%         30.0%                           (A) For the quarters ended November 30, 2013 and August 31, 2013, this line item represents net earnings attributable to third party interests in certain asset management entities and investment vehicles managed by us, including a Leucadia interest.

     

                              JEFFERIES GROUP LLC AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF EARNINGS (Amounts in Thousands) (Unaudited)                                 Successor     Predecessor       Nine Months     Three Months     Twelve Months       Ended     Ended     Ended       November 30, 2013     February 28, 2013 (A)     November 30, 2012                           Revenues:                         Commissions     $ 427,178     $ 131,083     $ 485,569 Principal transactions       399,091       300,278       1,035,974 Investment banking       1,003,517       288,278       1,125,883 Asset management fees and

    investment income from managed funds

          36,093       10,883       26,966 Interest income       714,248       249,277       1,031,839 Other revenues       94,195       27,004       164,974 Total revenues       2,674,322       1,006,803       3,871,205 Interest expense       579,059       203,416       872,421 Net revenues       2,095,263       803,387       2,998,784 Interest on mandatorily redeemable preferred interests of

    consolidated subsidiaries

          3,368       10,961       42,883 Net revenues, less interest on mandatorily redeemable preferred

    interests of consolidated subsidiaries

          2,091,895       792,426       2,955,901                           Non-interest expenses:                         Compensation and benefits       1,213,908       474,217       1,770,798                           Non-compensation expenses:                         Floor brokerage and clearing fees       105,357       30,998       120,145 Technology and communications       193,683       59,878       244,511 Occupancy and equipment rental       86,700       24,309       97,397 Business development       63,115       24,927       95,330 Professional services       72,802       24,135       73,427 Other       76,325       14,475       62,498 Total non-compensation expenses       597,982       178,722       693,308 Total non-interest expenses       1,811,890       652,939       2,464,106 Earnings before income taxes       280,005       139,487       491,795 Income tax expense       100,285       48,645       168,646 Net earnings       179,720       90,842       323,149 Net earnings attributable to noncontrolling interests (B)       8,418       10,704       40,740 Net earnings attributable to Jefferies Group LLC/ common shareholders     $ 171,302     $ 80,138     $ 282,409                           Compensation and benefits / Net revenues       57.9%       59.0%       59.1%                           Effective tax rate       35.8%       34.9%       34.3%                           (A) Our consolidated net earnings for the three months ended February 28, 2013 reflects an adjustment of $5.3 million, after tax, to correct for the effect of an overstatement of professional service fees of $8.5 million relating to the Leucadia merger. We evaluated the effects of this error and concluded that it is not material to the previously issued Quarterly Report on Form 10-Q for the three month period ended February 28, 2013. Nevertheless, we revised our consolidated net earnings for the three month period ended February 28, 2013 to correct for the effect of this error and appropriately reflected the $8.5 million of professional service fees as an expense in the nine month period ended November 30, 2013. (B) For the nine months ended November 30, 2013, this line item represents net earnings attributable to third party interests in certain asset management entities and investment vehicles managed by us, including a Leucadia interest.

     

                  JEFFERIES GROUP LLC AND SUBSIDIARIES SELECTED STATISTICAL INFORMATION (Amounts in Thousands, Except Other Data) (Unaudited)                           Quarter Ended       Successor     Predecessor       November 30,     August 31,     November 30,       2013     2013     2012

    Revenues by Source

                      Equities     $ 294,351     $ 151,037     $ 176,595 Fixed income       212,295       33,103       292,974

    Total

          506,646       184,140       469,569                                         Equity       118,348       56,482       52,919 Debt       162,031       120,187       145,772

    Capital markets

          280,379       176,669       198,691 Advisory       136,665       142,670       84,271 Investment banking       417,044       319,339       282,962                                   Asset management fees and investment gain

    from managed funds:

                Asset management fees       5,563       9,579       9,680 Investment gain from managed funds       6,454       3,971       6,638

    Total

          12,017       13,550       16,318 Net revenues       935,707       517,029       768,849

    Interest on mandatorily redeemable preferred interests of
    consolidated subsidiaries

          -       -       8,279

    Net revenues, less mandatorily redeemable preferred
    interests of consolidated subsidiaries

        $ 935,707     $ 517,029     $ 760,570                    

    Other Data

                      Number of trading days       63       64       63                     Average firmwide VaR (in millions) (A)     $ 12.61     $ 11.02     $ 13.38 Average firmwide VaR excluding Knight Capital (in millions) (A)     $ 10.37     $ 7.24     $ 7.95

    Average firmwide VaR excluding Knight Capital and Harbinger
    Group Inc. (in millions) (A)

        $ 7.32     $ 7.24     $ 7.95                    

    (A) VaR estimates the potential loss in value of our trading positions due to adverse market movements over a one-day time horizon with a 95% confidence level. For a further discussion of the calculation of VaR, see "Value at risk" in Part II, Item 7 "Management´s Discussion and Analysis" in our Annual Report on Form 10-K for the year ended November 30, 2012.

     

                JEFFERIES GROUP LLC AND SUBSIDIARIES FINANCIAL HIGHLIGHTS (Amounts in Millions, Except Where Noted) (Unaudited)                           Quarter Ended       Successor     Predecessor       November 30,     August 31,     November 30,       2013     2013     2012                    

    Results:

                      Net earnings attributable to Jefferies Group LLC / common shareholders (in thousands)     $ 120,054       $ 11,740       $ 71,604   Pretax operating margin       20.5 %       4.5 %       15.0 % Effective tax rate       34.9 %       36.3 %       30.0 %                    

    Financial position:

                      Total assets (1)     $ 40,176       $ 38,830       $ 36,294   Average total assets for quarter (1)     $ 46,439       $ 45,824       $ 44,242   Average total assets less goodwill and intangible assets for quarter (1)     $ 44,455