Cowen Group, Inc. Announces 2011 Fourth Quarter And Full-Year Financial Results

Cowen Group, Inc. (NASDAQ: COWN) (“Cowen” or “the Company”) today announced its operating results for the fourth quarter and full-year ended December 31, 2011.

2011 Fourth Quarter and Full-Year GAAP Financial Information and Select Balance Sheet Data

For the fourth quarter 2011, the Company reported a GAAP net loss from continuing operations (including noncontrolling interests) of $(56.3) million, or $(0.49) per share, compared to GAAP net income from continuing operations of $4.1 million, or $0.06 per share, in the fourth quarter 2010. The year-over-year decrease in GAAP net income from continuing operations was primarily due to a 29% decrease in revenues and a 17% increase in expenses. Including discontinued operations, the Company reported a GAAP net loss of $(79.9) million in the fourth quarter 2011 compared to net income of $4.1 million in the prior year period.

The Company's total fourth quarter 2011 financial results included the impact of:

• A $(23.6) million net loss from discontinued operations related to exiting the businesses operated by LaBranche subsidiaries;
• A $7.2 million and $5.2 million impairment of goodwill and intangible assets, respectively, related to the broker-dealer segment;
• $3.9 million in non-cash expenses related to vacating the remaining portion of the leased premises at 1221 Avenue of the Americas;
• $1.1 million in non-cash expenses related to the termination of service contracts; and
• $10.6 million in severance expense related to our expense reduction plan (not including an additional $5.1 million of severance expense included in the net loss from discontinued operations discussed above).

For the 2011 full-year, the Company reported a GAAP net loss from continuing operations (including noncontrolling interests) of $(84.4) million, or $(0.88) per share, compared to a GAAP net loss from continuing operations of $(45.4) million, or $(0.62) per share, in 2010. The increase in GAAP net loss from continuing operations was primarily due to an 11% increase in expenses and a 21% decrease in other income. This decrease was primarily due to the Company's third quarter losses on fixed income securities, equity options and other investments. Including discontinued operations, the Company reported a GAAP net loss of $(108.0) million in 2011 compared to $(45.4) million in 2010.

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