Cowen Group, Inc. (NASDAQ: COWN) (“Cowen” or “the Company”) today announced its operating results for the fourth quarter and full year ended December 31, 2012.
2012 Fourth Quarter and Full Year Highlights (1)
- Total revenue for the fourth quarter and full year was the highest since the Cowen / Ramius business combination in 2009. For the fourth quarter, revenue was $77.2 million, compared to $70.9 million in the fourth quarter of 2011. For the full year, total revenue was $288.6 million and compared to $270.2 million in 2011.
- The broker-dealer segment revenue rose 18% year over year in the fourth quarter of 2012 to $45.6 million (2). For the full year 2012, broker-dealer segment revenue increased to $175.8 million (2), up 11% from 2011.
- Investment banking revenue increased 90% in the fourth quarter to $21.2 million and 41% to $71.8 million for the full year. The increase in both periods was primarily attributable to our equity underwriting activity in the healthcare sector and debt capital markets transactions.
- Brokerage revenue was $22.4 million in the fourth quarter, which represented a 3% increase year over year. For the full year, brokerage revenue was $93.9 million, down $5.7 million compared to 2011.
- Management fees at Ramius rose 7% sequentially to $14.3 million in the fourth quarter of 2012. After adjusting for cumulative retrospective management fees in our healthcare royalty funds recognized in 2011, fourth quarter 2012 management fees were unchanged from the prior year period and declined 1% to $56.4 million for the full year 2012.
- Incentive income was $6.9 million in the fourth quarter, compared to $0.1 million in the prior year period. Full year 2012 incentive income was $15.2 million, a 47% increase over 2011. The increase in both periods is primarily driven by an increase in performance fees from our fund products.
- Assets under management at January 1, 2013 were $8.1 billion, which remained relatively constant during the 2012 fourth quarter and decreased 2% for the year after adjusting for the disposition of cash management assets under management which occurred during the fourth quarter of 2012.
- For the full year 2012, total expenses declined by $29.7 million from 2011, in line with our expense reduction targets for 2012.
- In December 2012, Michael Singer joined Ramius as CEO, bringing a strong and diverse background in alternative asset management.
- On February 1st, Cowen announced its entry into a definitive agreement to acquire Dahlman Rose & Co., a privately held investment bank specializing in the energy, metals and mining, transportation, chemicals and agriculture sectors.