Cohen & Company Inc. (NYSE American: COHN), a financial
services firm specializing in an expanding range of capital markets
and asset management services, today reported financial results for
its second quarter ended June 30, 2023.
Summary Operating Results
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Six Months Ended |
($ in thousands) |
6/30/23 |
|
3/31/23 |
|
6/30/22 |
|
6/30/23 |
|
6/30/22 |
|
|
|
|
|
|
|
|
|
|
Net trading |
$ |
7,416 |
|
|
$ |
8,210 |
|
|
$ |
10,377 |
|
|
$ |
15,626 |
|
|
$ |
22,399 |
|
Asset management |
|
1,605 |
|
|
|
2,025 |
|
|
|
1,898 |
|
|
|
3,630 |
|
|
|
3,787 |
|
New issue and advisory |
|
1,395 |
|
|
|
900 |
|
|
|
3,481 |
|
|
|
2,295 |
|
|
|
7,251 |
|
Principal transactions and
other revenue |
|
12,156 |
|
|
|
(2,311 |
) |
|
|
(6,602 |
) |
|
|
9,845 |
|
|
|
(24,965 |
) |
Total revenues |
|
22,572 |
|
|
|
8,824 |
|
|
|
9,154 |
|
|
|
31,396 |
|
|
|
8,472 |
|
Compensation and benefits |
|
10,001 |
|
|
|
10,537 |
|
|
|
12,214 |
|
|
|
20,538 |
|
|
|
26,093 |
|
Non-compensation operating
expenses |
|
5,572 |
|
|
|
5,770 |
|
|
|
5,102 |
|
|
|
11,342 |
|
|
|
10,419 |
|
Operating income |
|
6,999 |
|
|
|
(7,483 |
) |
|
|
(8,162 |
) |
|
|
(484 |
) |
|
|
(28,040 |
) |
Interest expense, net |
|
(1,630 |
) |
|
|
(1,592 |
) |
|
|
(1,106 |
) |
|
|
(3,222 |
) |
|
|
(2,457 |
) |
Income (loss) from equity
method affiliates |
|
(511 |
) |
|
|
(395 |
) |
|
|
(3,044 |
) |
|
|
(906 |
) |
|
|
(15,148 |
) |
Income (loss) before income tax expense (benefit) |
|
4,858 |
|
|
|
(9,470 |
) |
|
|
(12,312 |
) |
|
|
(4,612 |
) |
|
|
(45,645 |
) |
Income tax expense
(benefit) |
|
5,550 |
|
|
|
584 |
|
|
|
(60 |
) |
|
|
6,134 |
|
|
|
1,773 |
|
Net income (loss) |
|
(692 |
) |
|
|
(10,054 |
) |
|
|
(12,252 |
) |
|
|
(10,746 |
) |
|
|
(47,418 |
) |
Less: Net income (loss) attributable to the non-convertible
non-controlling interest |
|
6,503 |
|
|
|
97 |
|
|
|
(4,167 |
) |
|
|
6,600 |
|
|
|
(18,871 |
) |
Enterprise net income (loss) |
|
(7,195 |
) |
|
|
(10,151 |
) |
|
|
(8,085 |
) |
|
|
(17,346 |
) |
|
|
(28,547 |
) |
Less: Net income (loss) attributable to the convertible
non-controlling interest |
|
(594 |
) |
|
|
(7,514 |
) |
|
|
(6,228 |
) |
|
|
(8,108 |
) |
|
|
(19,078 |
) |
Net income (loss) attributable to Cohen & Company Inc. |
$ |
(6,601 |
) |
|
$ |
(2,637 |
) |
|
$ |
(1,857 |
) |
|
$ |
(9,238 |
) |
|
$ |
(9,469 |
) |
Fully diluted net income (loss) per share |
$ |
(4.34 |
) |
|
$ |
(1.77 |
) |
|
$ |
(1.53 |
) |
|
$ |
(6.14 |
) |
|
$ |
(6.71 |
) |
|
|
|
|
|
|
|
|
|
|
Adjusted pre-tax income
(loss) |
$ |
(1,645 |
) |
|
$ |
(9,567 |
) |
|
$ |
(8,145 |
) |
|
$ |
(11,212 |
) |
|
$ |
(26,774 |
) |
Fully diluted adjusted pre-tax
income (loss) per share |
$ |
(0.30 |
) |
|
$ |
(1.74 |
) |
|
$ |
(1.51 |
) |
|
$ |
(2.03 |
) |
|
$ |
(4.91 |
) |
|
|
|
|
|
|
|
|
|
|
Adjusted pre-tax income (loss) is not a measure
recognized under U.S. generally accepted accounting principles
(“GAAP”). See Note 1 below.
Lester Brafman, Chief Executive Officer of Cohen
& Company, said, “Our principal investing segment recovered,
while net trading and new issue and advisory revenue remained
relatively stagnant during the second quarter. Our team of bankers
and originators continue to build our pipeline, which we expect
will drive higher revenue in the near term. As we continue to make
progress on our pipeline, we are pleased to have already closed
approximately $5 million of new issue and advisory revenue to-date
in the third quarter. As always, we remain focused on enhancing
stockholder value, and are optimistic about the future as evidenced
by our continued payment of our quarterly dividend.”
Financial Highlights
- Net loss attributable to Cohen
& Company Inc. was $6.6 million, or $4.34 per diluted share,
for the three months ended June 30, 2023, compared to net loss of
$2.6 million, or $1.77 per diluted share, for the three months
ended March 31, 2023, and net loss of $1.9 million, or $1.53 per
diluted share, for the three months ended June 30, 2022. Adjusted
pre-tax loss was $1.6 million, or $0.30 per diluted share, for the
three months ended June 30, 2023, compared to adjusted pre-tax loss
of $9.6 million, or $1.74 per diluted share, for the three months
ended March 31, 2023, and adjusted pre-tax loss of $8.1 million, or
$1.51 per diluted share, for the three months ended June 30, 2022.
Adjusted pre-tax income (loss) and adjusted pre-tax income (loss)
per diluted share are not measures recognized under GAAP. See Note
1 below.
- Revenues were $22.6 million for the
three months ended June 30, 2023, compared to $8.8 million for the
prior quarter and $9.2 million for the prior year quarter.
- Net trading revenue was $7.4
million for the three months ended June 30, 2023, down $0.8 million
from the prior quarter and $3.0 million from the prior year
quarter. The decrease from the prior quarter was due primarily to
lower trading revenue by our corporate, agency, municipal, and
treasury groups, and the decrease from the prior year quarter was
due primarily to lower trading revenue by our mortgage group.
- Asset management revenue was $1.6
million for the three months ended June 30, 2023, down $0.4 million
from the prior quarter and $0.3 million from the prior year
quarter. The decrease from both prior quarters was due primarily to
no revenue being earned by the manager of the Company’s SPAC fund
in the current quarter, as a result of SPAC fund investors
redeeming all of their interests in the SPAC fund at the end of the
first quarter of 2023.
- New issue and advisory revenue was
$1.4 million for the three months ended June 30, 2023, up $0.5
million from the prior quarter and down $2.1 million from the prior
year quarter. In the current quarter, the Cohen & Company
Capital Markets investment banking team generated $0.9 million and
the U.S. insurance origination team generated $0.5 million of the
new issue and advisory revenue.
- Principal transactions and other
revenue was $12.2 million for the three months ended June 30, 2023,
compared to negative $2.3 million in the prior quarter and negative
$6.6 million in the prior year quarter.
- Compensation and benefits expense
during the three months ended June 30, 2023 decreased $0.5 million
from the prior quarter and $2.2 million from the prior year
quarter. The number of Company employees was 117 as of June 30,
2023, compared to 121 as of March 31, 2023, and 121 as of June 30,
2022.
- Interest expense during the three
months ended June 30, 2023 was comparable to the prior quarter and
increased $0.5 million from the prior year quarter. The increase
from the prior year quarter was primarily due to higher interest on
our trust preferred securities.
- Loss from equity method affiliates
for the three months ended June 30, 2023 was $0.5 million, compared
to loss from equity method affiliates of $0.4 million for the prior
quarter and loss from equity method affiliates of $3.0 million for
the prior year quarter.
- Income tax expense for the three
months ended June 30, 2023 was $5.6 million, compared to $0.6
million in the prior quarter, and income tax benefit of $0.1
million in the prior year quarter. The current quarter expense was
the result of an increase to the valuation allowance applied
against the Company's net operating loss and net capital loss tax
assets. The Company will continue to evaluate its operations on a
quarterly basis and may adjust the valuation allowance applied
against the Company's net operating loss and net capital loss tax
assets. Future adjustments could be material and may result in
additional tax benefit or tax expense.
Total Equity and Dividend Declaration
- As of June 30, 2023, total equity
was $81.3 million, compared to $94.0 million as of December 31,
2022; the non-convertible non-controlling interest component of
total equity was $6.7 million as of June 30, 2023 and $17 thousand
as of December 31, 2022. Thus, the total equity excluding the
non-convertible non-controlling interest component was $74.7
million as of June 30, 2023, a $19.4 million decrease from $94.0
million as of December 31, 2022.
- The Company’s Board of Directors
has declared a quarterly dividend of $0.25 per share, payable on
September 1, 2023, to stockholders of record as of August 18, 2023.
The Board of Directors will continue to evaluate the dividend
policy each quarter, and future decisions regarding dividends may
be impacted by quarterly operating results and the Company’s
capital needs.
Update on Quarterly Conference Calls
Cohen & Company will not conduct quarterly
conference calls for the foreseeable future. The Company intends to
continue its practice of issuing earnings releases in connection
with the filing of its quarterly and annual reports. Investors can
find contact information at the bottom of this release should they
have any questions about the second quarter results or the
Company.
About Cohen & Company
Cohen & Company is a financial services
company specializing in an expanding range of capital markets and
asset management services. Cohen & Company’s operating segments
are Capital Markets, Asset Management, and Principal Investing. The
Capital Markets segment consists of fixed income sales, trading,
and gestation repo financing as well as new issue placements in
corporate and securitized products, and advisory services,
operating primarily through Cohen & Company’s subsidiaries,
J.V.B. Financial Group, LLC in the United States and Cohen &
Company Financial (Europe) S.A. in Europe. A division of JVB, Cohen
& Company Capital Markets is the Company’s full-service
boutique investment bank with a focus on mergers and acquisitions,
capital markets, and SPAC advisory services. The Asset Management
segment manages assets through collateralized debt obligations,
managed accounts, and investment funds. As of June 30, 2023, the
Company managed approximately $2.1 billion in primarily fixed
income assets in a variety of asset classes including US and
European trust preferred securities, subordinated debt, and
corporate loans. The Principal Investing segment is comprised
primarily of investments the Company holds related to its SPAC
franchise and other investments the Company has made for the
purpose of earning an investment return rather than investments
made to support its trading or other capital markets business
activity. For more information, please visit
www.cohenandcompany.com.
Note 1: Adjusted pre-tax income
(loss) and adjusted pre-tax income (loss) per share are non-GAAP
measures of performance. Please see the discussion under “Non-GAAP
Measures” below. Also see the tables below for the reconciliations
of non-GAAP measures of performance to their corresponding GAAP
measures of performance.
Forward-looking Statements
This communication contains certain statements,
estimates, and forecasts with respect to future performance and
events. These statements, estimates, and forecasts are
“forward-looking statements.” In some cases, forward-looking
statements can be identified by the use of forward-looking
terminology such as “may,” “might,” “will,” “should,” “expect,”
“plan,” “anticipate,” “believe,” “estimate,” “predict,”
“potential,” “seek,” or “continue” or the negatives thereof or
variations thereon or similar terminology. All statements other
than statements of historical fact included in this communication
are forward-looking statements and are based on various underlying
assumptions and expectations and are subject to known and unknown
risks, uncertainties, and assumptions, and may include projections
of our future financial performance based on our growth strategies
and anticipated trends in our business. These statements are based
on our current expectations and projections about future events.
There are important factors that could cause our actual results,
level of activity, performance, or achievements to differ
materially from the results, level of activity, performance, or
achievements expressed or implied in the forward-looking statements
including, but not limited to, those discussed under the heading
“Risk Factors” and “Management’s Discussion and Analysis of
Financial Condition” in our filings with the Securities and
Exchange Commission (“SEC”), which are available at the SEC’s
website at www.sec.gov and our website at
www.cohenandcompany.com/investor-relations/sec-filings. Such risk
factors include the following: (a) a decline in general economic
conditions or the global financial markets, including those caused
by inflation, raising interest rates, and the Russian/Ukrainian
war, (b) losses caused by financial or other problems experienced
by third parties, (c) losses due to unidentified or unanticipated
risks, (d) a lack of liquidity, i.e., ready access to funds for use
in our businesses, (e) the ability to attract and retain personnel,
(f) litigation and regulatory issues, (g) competitive pressure, (h)
an inability to generate incremental income from new or expanded
businesses, (i) unanticipated market closures or effects due to
inclement weather or other disasters, (j) losses (whether realized
or unrealized) on our principal investments, (k) the possibility
that payments to the Company of subordinated management fees from
its CDOs will continue to be deferred or will be discontinued, (l)
the possibility that the stockholder rights plan may fail to
preserve the value of the Company’s deferred tax assets, whether as
a result of the acquisition by a person of 5% of the Company’s
common stock or otherwise, (m) the Company’s reduction in the
volume of its investments into SPACs, (n) the difficulty in
identifying potential business combinations as a result of
increased competition in the SPAC market, (o) the value of our
holdings of founders shares in post-business combination companies
is volatile and may decline and the possibility that significant
portions of the founder shares may remain restricted for a long
period of time, (p) the possibility that the Company will stop
paying quarterly dividends to its stockholders, (q) the possibility
that the Company will incur additional losses liquidating
collateral related to a reverse repo with now bankrupt First
Guaranty Mortgage Corporation, (r) the impacts of rising interest
rates and inflation, and (s) the impacts of the COVID-19 pandemic.
As a result, there can be no assurance that the forward-looking
statements included in this communication will prove to be accurate
or correct. In light of these risks, uncertainties, and
assumptions, the future performance or events described in the
forward-looking statements in this communication might not occur.
Accordingly, you should not rely upon forward-looking statements as
a prediction of actual results and we do not undertake any
obligation to update any forward-looking statements, whether as a
result of new information, future events, or otherwise.
Cautionary Note Regarding Quarterly Financial
Results
Due to the nature of our business, our revenue
and operating results may fluctuate materially from quarter to
quarter. Accordingly, revenue and net income in any particular
quarter may not be indicative of future results. Further, our
employee compensation arrangements are in large part
incentive-based and, therefore, will fluctuate with revenue. The
amount of compensation expense recognized in any one quarter may
not be indicative of such expense in future periods. As a result,
we suggest that annual results may be the most meaningful gauge for
investors in evaluating our business performance.
COHEN & COMPANY INC. |
CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) |
(in thousands, except per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Six Months Ended |
|
|
|
6/30/23 |
|
3/31/23 |
|
6/30/22 |
|
6/30/23 |
|
6/30/22 |
|
|
Revenues |
|
|
|
|
|
|
|
|
|
|
|
Net trading |
$ |
7,416 |
|
|
$ |
8,210 |
|
|
$ |
10,377 |
|
|
$ |
15,626 |
|
|
$ |
22,399 |
|
|
|
Asset management |
|
1,605 |
|
|
|
2,025 |
|
|
|
1,898 |
|
|
|
3,630 |
|
|
|
3,787 |
|
|
|
New issue and advisory |
|
1,395 |
|
|
|
900 |
|
|
|
3,481 |
|
|
|
2,295 |
|
|
|
7,251 |
|
|
|
Principal transactions and other revenue |
|
12,156 |
|
|
|
(2,311 |
) |
|
|
(6,602 |
) |
|
|
9,845 |
|
|
|
(24,965 |
) |
|
|
Total revenues |
|
22,572 |
|
|
|
8,824 |
|
|
|
9,154 |
|
|
|
31,396 |
|
|
|
8,472 |
|
|
|
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
Compensation and benefits |
|
10,001 |
|
|
|
10,537 |
|
|
|
12,214 |
|
|
|
20,538 |
|
|
|
26,093 |
|
|
|
Business development, occupancy, equipment |
|
1,318 |
|
|
|
1,301 |
|
|
|
1,295 |
|
|
|
2,619 |
|
|
|
2,543 |
|
|
|
Subscriptions, clearing, and execution |
|
2,343 |
|
|
|
2,125 |
|
|
|
1,972 |
|
|
|
4,468 |
|
|
|
3,913 |
|
|
|
Professional services and other operating |
|
1,762 |
|
|
|
2,200 |
|
|
|
1,692 |
|
|
|
3,962 |
|
|
|
3,688 |
|
|
|
Depreciation and amortization |
|
149 |
|
|
|
144 |
|
|
|
143 |
|
|
|
293 |
|
|
|
275 |
|
|
|
Total operating expenses |
|
15,573 |
|
|
|
16,307 |
|
|
|
17,316 |
|
|
|
31,880 |
|
|
|
36,512 |
|
|
|
Operating income (loss) |
|
6,999 |
|
|
|
(7,483 |
) |
|
|
(8,162 |
) |
|
|
(484 |
) |
|
|
(28,040 |
) |
|
|
Non-operating income
(expense) |
|
|
|
|
|
|
|
|
|
|
|
Interest expense, net |
|
(1,630 |
) |
|
|
(1,592 |
) |
|
|
(1,106 |
) |
|
|
(3,222 |
) |
|
|
(2,457 |
) |
|
|
Income (loss) from equity method affiliates |
|
(511 |
) |
|
|
(395 |
) |
|
|
(3,044 |
) |
|
|
(906 |
) |
|
|
(15,148 |
) |
|
|
Income (loss) before income tax expense (benefit) |
|
4,858 |
|
|
|
(9,470 |
) |
|
|
(12,312 |
) |
|
|
(4,612 |
) |
|
|
(45,645 |
) |
|
|
Income tax expense (benefit) |
|
5,550 |
|
|
|
584 |
|
|
|
(60 |
) |
|
|
6,134 |
|
|
|
1,773 |
|
|
|
Net income (loss) |
|
(692 |
) |
|
|
(10,054 |
) |
|
|
(12,252 |
) |
|
|
(10,746 |
) |
|
|
(47,418 |
) |
|
|
Less: Net income (loss) attributable to the non-convertible
non-controlling interest |
|
6,503 |
|
|
|
97 |
|
|
|
(4,167 |
) |
|
|
6,600 |
|
|
|
(18,871 |
) |
|
|
Enterprise net income (loss) |
|
(7,195 |
) |
|
|
(10,151 |
) |
|
|
(8,085 |
) |
|
|
(17,346 |
) |
|
|
(28,547 |
) |
|
|
Less: Net income (loss) attributable to the convertible
non-controlling interest |
|
(594 |
) |
|
|
(7,514 |
) |
|
|
(6,228 |
) |
|
|
(8,108 |
) |
|
|
(19,078 |
) |
|
|
Net income (loss) attributable to Cohen & Company Inc. |
$ |
(6,601 |
) |
|
$ |
(2,637 |
) |
|
$ |
(1,857 |
) |
|
$ |
(9,238 |
) |
|
$ |
(9,469 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share |
|
Basic |
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) attributable
to Cohen & Company Inc. |
$ |
(6,601 |
) |
|
$ |
(2,637 |
) |
|
$ |
(1,857 |
) |
|
$ |
(9,238 |
) |
|
$ |
(9,469 |
) |
|
|
Basic shares outstanding |
|
1,520 |
|
|
|
1,489 |
|
|
|
1,428 |
|
|
|
1,505 |
|
|
|
1,412 |
|
|
|
Net income (loss) attributable
to Cohen & Company Inc. per share |
$ |
(4.34 |
) |
|
$ |
(1.77 |
) |
|
$ |
(1.30 |
) |
|
$ |
(6.14 |
) |
|
$ |
(6.71 |
) |
|
|
Fully Diluted |
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) attributable
to Cohen & Company Inc. |
$ |
(6,601 |
) |
|
$ |
(2,637 |
) |
|
$ |
(1,857 |
) |
|
$ |
(9,238 |
) |
|
$ |
(9,469 |
) |
|
|
Net income (loss) attributable
to the convertible non-controlling interest |
|
- |
|
|
|
(7,514 |
) |
|
|
(6,228 |
) |
|
|
- |
|
|
|
- |
|
|
|
Income tax and conversion
adjustment |
|
- |
|
|
|
435 |
|
|
|
(172 |
) |
|
|
- |
|
|
|
- |
|
|
|
Net income (loss) attributable
to Cohen & Company Inc. for fully diluted net income (loss) per
share calculation |
$ |
(6,601 |
) |
|
$ |
(9,716 |
) |
|
$ |
(8,257 |
) |
|
$ |
(9,238 |
) |
|
$ |
(9,469 |
) |
|
|
Basic shares outstanding |
|
1,520 |
|
|
|
1,489 |
|
|
|
1,428 |
|
|
|
1,505 |
|
|
|
1,412 |
|
|
|
Unrestricted Operating LLC
membership units exchangeable into COHN shares |
|
- |
|
|
|
3,998 |
|
|
|
3,966 |
|
|
|
- |
|
|
|
- |
|
|
|
Fully diluted shares
outstanding (1) |
|
1,520 |
|
|
|
5,487 |
|
|
|
5,394 |
|
|
|
1,505 |
|
|
|
1,412 |
|
|
|
Fully diluted net income
(loss) per share |
$ |
(4.34 |
) |
|
$ |
(1.77 |
) |
|
$ |
(1.53 |
) |
|
$ |
(6.14 |
) |
|
$ |
(6.71 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of adjusted pre-tax income (loss) to net income
(loss) attributable to Cohen & Company Inc. and calculations of
per share amounts |
|
Net income (loss) attributable
to Cohen & Company Inc. |
$ |
(6,601 |
) |
|
$ |
(2,637 |
) |
|
$ |
(1,857 |
) |
|
$ |
(9,238 |
) |
|
$ |
(9,469 |
) |
|
|
Addback (deduct): Income tax
expense (benefit) |
|
5,550 |
|
|
|
584 |
|
|
|
(60 |
) |
|
|
6,134 |
|
|
|
1,773 |
|
|
|
Addback (deduct): Net income
(loss) attributable to the convertible non-controlling
interest |
|
(594 |
) |
|
|
(7,514 |
) |
|
|
(6,228 |
) |
|
|
(8,108 |
) |
|
|
(19,078 |
) |
|
|
Adjusted pre-tax income
(loss) |
|
(1,645 |
) |
|
|
(9,567 |
) |
|
|
(8,145 |
) |
|
|
(11,212 |
) |
|
|
(26,774 |
) |
|
|
Net interest attributable to
convertible debt |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
327 |
|
|
|
Enterprise pre-tax income
(loss) for fully diluted adjusted pre-tax income (loss) per share
calculation |
$ |
(1,645 |
) |
|
$ |
(9,567 |
) |
|
$ |
(8,145 |
) |
|
$ |
(11,212 |
) |
|
$ |
(26,447 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted fully diluted shares
outstanding (2) |
|
5,535 |
|
|
|
5,505 |
|
|
|
5,401 |
|
|
|
5,520 |
|
|
|
5,382 |
|
|
|
Fully diluted adjusted pre-tax
income (loss) per share |
$ |
(0.30 |
) |
|
$ |
(1.74 |
) |
|
$ |
(1.51 |
) |
|
$ |
(2.03 |
) |
|
$ |
(4.91 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) When the
fully diluted net income (loss) per share is anti-dilutive, the
basic shares outstanding are presented on this line item. |
|
|
(2) Adjusted
fully diluted shares outstanding includes (a) Operating LLC units
exchangeable into COHN shares at all times, including weighted
restricted units, and (b) weighted restricted shares, even during
periods when the corresponding GAAP calculation of fully diluted
shares outstanding above does not include them. The Operating LLC
units are always included because the non-GAAP measure of
performance, adjusted pre-tax income (loss), always includes net
income (loss) attributable to the corresponding convertible
interest. |
|
|
|
|
|
|
|
|
|
|
|
|
|
COHEN & COMPANY INC. |
CONSOLIDATED BALANCE SHEETS |
(in thousands) |
|
|
|
|
|
|
|
|
June 30, 2023 |
|
December 31, |
|
|
|
(unaudited) |
|
2022 |
|
|
Assets |
|
|
|
|
|
Cash and cash equivalents |
$ |
12,166 |
|
|
$ |
29,101 |
|
|
|
Receivables from brokers, dealers, and clearing agencies |
|
108,020 |
|
|
|
140,933 |
|
|
|
Due from related parties |
|
719 |
|
|
|
787 |
|
|
|
Other receivables |
|
5,734 |
|
|
|
9,527 |
|
|
|
Investments - trading |
|
192,805 |
|
|
|
211,828 |
|
|
|
Other investments, at fair value |
|
56,868 |
|
|
|
28,022 |
|
|
|
Receivables under resale agreements |
|
457,528 |
|
|
|
437,692 |
|
|
|
Investment in equity method affiliates |
|
8,782 |
|
|
|
8,929 |
|
|
|
Deferred income taxes |
|
331 |
|
|
|
6,934 |
|
|
|
Goodwill |
|
109 |
|
|
|
109 |
|
|
|
Right-of-use asset - operating leases |
|
8,612 |
|
|
|
9,647 |
|
|
|
Other assets |
|
4,452 |
|
|
|
3,546 |
|
|
|
Total assets |
$ |
856,126 |
|
|
$ |
887,055 |
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
Payables to brokers, dealers, and clearing agencies |
$ |
127,627 |
|
|
$ |
134,985 |
|
|
|
Accounts payable and other liabilities |
|
8,513 |
|
|
|
11,439 |
|
|
|
Accrued compensation |
|
8,044 |
|
|
|
12,434 |
|
|
|
Trading securities sold, not yet purchased |
|
98,117 |
|
|
|
133,957 |
|
|
|
Other investments sold, not yet purchased, at fair value |
|
28,606 |
|
|
|
78 |
|
|
|
Securities sold under agreements to repurchase |
|
457,351 |
|
|
|
452,797 |
|
|
|
Operating lease liability |
|
9,365 |
|
|
|
10,447 |
|
|
|
Redeemable financial instruments |
|
7,868 |
|
|
|
7,868 |
|
|
|
Debt |
|
29,324 |
|
|
|
29,024 |
|
|
|
Total liabilities |
|
774,815 |
|
|
|
793,029 |
|
|
|
|
|
|
|
|
|
Equity |
|
|
|
|
|
Voting non-convertible preferred stock |
|
27 |
|
|
|
27 |
|
|
|
Common stock |
|
18 |
|
|
|
17 |
|
|
|
Additional paid-in capital |
|
73,967 |
|
|
|
72,801 |
|
|
|
Accumulated other comprehensive loss |
|
(955 |
) |
|
|
(955 |
) |
|
|
Accumulated deficit |
|
(35,373 |
) |
|
|
(25,151 |
) |
|
|
Total stockholders' equity |
|
37,684 |
|
|
|
46,739 |
|
|
|
Non-controlling interest |
|
43,627 |
|
|
|
47,287 |
|
|
|
Total equity |
|
81,311 |
|
|
|
94,026 |
|
|
|
Total liabilities and equity |
$ |
856,126 |
|
|
$ |
887,055 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Measures
Adjusted pre-tax income (loss) and adjusted
pre-tax income (loss) per diluted share
Adjusted pre-tax income (loss) is not a
financial measure recognized by GAAP. Adjusted pre-tax income
(loss) represents net income (loss) attributable to Cohen &
Company Inc., computed in accordance with GAAP, excluding income
tax expense (benefit), plus the net income (loss) attributable to
the convertible non-controlling interest. Income tax expense
(benefit) has been excluded because a pre-tax measurement of
enterprise earnings that includes net income (loss) attributable to
the convertible non-controlling interest is a useful and
appropriate measure of performance. Furthermore, our income tax
expense (benefit) has been, and we expect it will continue to be, a
substantially non-cash item for the foreseeable future, generated
from adjustments in our valuation allowance applied to the
Company’s gross deferred tax assets. Convertible non-controlling
interest is added back to adjusted pre-tax income because the
underlying Cohen & Company, LLC equity units are convertible
into Cohen & Company Inc. shares. Adjusted pre-tax income
(loss) per diluted share is calculated, by dividing adjusted
pre-tax income (loss) by diluted shares outstanding, both of which
include adjustments used in the corresponding calculation in
accordance with GAAP.
We present adjusted pre-tax income (loss) and
related per diluted share amounts in this release because we
consider them to be useful and appropriate supplemental measures of
our performance. Adjusted pre-tax income (loss) and related per
diluted share amounts help us to evaluate our performance without
the effects of certain GAAP calculations that may not have a direct
cash or recurring impact on our current operating performance. In
addition, our management uses adjusted pre-tax income (loss) and
related per diluted share amounts to evaluate the performance of
our enterprise operations. Adjusted pre-tax income (loss) and
related per diluted share amounts, as we define them, are not
necessarily comparable to similarly named measures of other
companies and may not be appropriate measures for performance
relative to other companies. Adjusted pre-tax income (loss) should
not be assessed in isolation from or construed as a substitute for
net income (loss) attributable to Cohen & Company Inc. prepared
in accordance with GAAP. Adjusted pre-tax income (loss) is not
intended to represent and should not be considered to be a more
meaningful measure than, or an alternative to, measures of
operating performance as determined in accordance with GAAP.
Contact: |
|
|
Investors - |
Media - |
Cohen & Company Inc. |
Joele Frank, Wilkinson Brimmer Katcher |
Joseph W. Pooler, Jr. |
Nick Jannuzzi |
Executive Vice President and |
212-351-8957 |
Chief Financial Officer |
njannuzzi@joelefrank.com |
215-701-8952 |
|
investorrelations@cohenandcompany.com |
|
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