EBITDA, as adjusted, was $8.4 million in 2011 as compared to $2.7 million. EBITDA, as adjusted, for the fourth quarter of 2011 was $1.4 million as compared to $1.3 million for the prior-year period in 2010. The following table presents a reconciliation of EBITDA, as adjusted, to net loss as reported.

        Year ended       Three months ended

December 31,

December 31,
(in thousands)

2011
   

2010

2011
   

2010
(unaudited)
Total revenues $

273,600 (1)
$

194,526 (2)
$ 107,269 $ 54,608
Total expenses 285,902 204,616 118,061 55,515
Pre-tax loss (12,302 ) (10,090 ) (10,792 ) (907 )
Net income (loss) 3,893 (10,951 ) 6,354 (1,114 )
 
Reconciliation of EBITDA, as adjusted, to net income (loss):
EBITDA, as adjusted $ 8,422 $ 2,701 $ 1,369 $ 1,330
Add:
Interest income 70 (14 ) 43 15
Income tax benefit 16,195 17,146
Less:
Interest expense (6,543 ) (3,241 ) (4,075 ) (708 )
Income tax expense (861 ) (207 )
Depreciation and amortization expense (5,632 ) (3,978 ) (2,982 ) (948 )
Non-cash compensation expense (4,014 ) (5,439 ) (1,242 ) (783 )
Clearing firm conversion expense (119 ) 187
Acquisition related expense (2,971 ) (2,271 )
Amortization of retention loans   (1,634 )       (1,634 )    
Net income (loss) $ 3,893   $ (10,951 ) $ 6,354   $ (1,114 )

_______________
   

(1)
  Includes $57,090 of revenue from Securities America (acquired November 4, 2011).

(2)
Includes $970 of revenue from Premier (acquired September 1, 2010).
 

Earnings before interest, taxes, depreciation and amortization, or EBITDA, adjusted for acquisition-related expense, amortization of retention loans for the Securities America acquisition, gains or losses on sales of assets, non-cash compensation expense and clearing conversion expense is a key metric the Company uses in evaluating its financial performance. EBITDA is considered a non-GAAP financial measure as defined by Regulation G promulgated by the SEC under the Securities Act of 1933, as amended. The Company considers EBITDA, as adjusted, important in evaluating its financial performance on a consistent basis across various periods. Due to the significance of non-cash and non-recurring items, EBITDA, as adjusted, enables the Company’s Board of Directors and management to monitor and evaluate the business on a consistent basis. The Company uses EBITDA, as adjusted, as a primary measure, among others, to analyze and evaluate financial and strategic planning decisions regarding future operating investments and potential acquisitions. The Company believes that EBITDA, as adjusted, eliminates items that are not indicative of its core operating performance, such as acquisition-related expenses, amortization of retention loans for the Securities America acquisition, and expenses related to Investacorp's conversion to a single clearing firm as part of a new seven-year clearing arrangement, or do not involve a cash outlay, such as stock-related compensation. EBITDA should be considered in addition to, rather than as a substitute for, pre-tax income, net income and cash flows from operating activities.

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