Securities and investment banking firm Jefferies Group, Inc. (JEF) reported Tuesday a profit for the fourth quarter that grew from last year, reflecting double-digit revenue growth. Both adjusted earnings per share and quarterly revenues topped analysts' expectations.
The New York-based company reported net earnings of $71.60 million or $0.31 per share for the fourth quarter, higher than $48.39 million or $0.21 per share in the prior-year quarter. Excluding hurricane Sandy relief donation, Leucadia merger costs and other items, adjusted earnings for the latest quarter was $80.86 million or $0.35 per share.
On average, eight analysts polled by Thomson Reuters expected the company to report earnings of $0.32 per share for the fourth quarter. Analysts' estimates typically exclude special items.
Total revenues increased to $973.27 million from $798.74 million in the year-ago quarter. Net revenues, less mandatorily redeemable preferred interest, for the quarter grew to $760.57 million from $556.54 in the same quarter last year, and topped seven Wall Street analysts' consensus estimate of $722.56 million.
Commissions revenue declined to $127 million from $131 million in the prior-year quarter. Principal transactions revenue was $242 million, sharply higher than last year's $37 million. Revenues from investment banking grew 8 percent to $283 million from the year-ago quarter.
The company also reported asset management fees and investment income from managed funds of $16.32 million, up from $6.62 million in the previous year. Meanwhile, the company's interest revenue declined to $243 million from $317 million a year ago.
Non-compensation expense for the quarter rose to $186 million from $178 million in the prior-year quarter. Total non-interest expenses for the quarter were $647 million, up from $486 million a year ago.
For fiscal 2012, Jefferies reported net earnings of $282.41 million or $1.22 per share, lower than $284.62 million or $1.28 per share posted last year. Excluding items, adjusted earnings for the latest year was $301.77 million or $1.31 per share. Analysts expected the company to report earnings of $1.22 per share for fiscal 2012.
Net revenues, less mandatorily redeemable preferred interest, for the year was $2.96 billion, up from $2.55 billion in the year ago. Street was looking for full-year 2012 revenues of $2.84 billion.
"2013 will mark the beginning of a new era for Jefferies. We believe our imminent merger with Leucadia will result in an even stronger Jefferies, as well as making us even more distinguished from our bank holding company competitors. The traditional, entrepreneurial Wall Street model has served us well historically and we believe this will continue to be an advantage into the future," Chairman and CEO Richard Handler said in a statement.
JEF closed Monday's regular trading session at $18.24, down $0.01 on a volume of 2.83 million shares. In the past 52-week period, the stock has been trading in a range of $11.59 to $19.82.
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