Cohen & Co Inc.
For the period ended Sep 30, 2024. Filed Nov 4, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2024 · Filed Nov 4, 2024
COHN$10.19+1.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-06-30; filed 2024-08-06.
0001437749-24-024742
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-09-30; filed 2024-11-04.
0001437749-24-033077
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 246 previous paragraphs and 253 current paragraphs.
179 unchanged; 56 reworded; 18 added; 11 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 45 previous and 46 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (18)
Current report
Interest Rates and Inflation
Current report
Redemption of Redeemable Financial Instrument and Issuance of the 2024 Note
Current report
Effective September 1, 2024, we entered into the Redemption Agreement, which redeemed the JKD Investment Agreement in its entirety. Effective September 1, 2024, the investment balance of the JKD Investment Agreement was $7,719. Pursuant to the Redemption Agreement, we (i) paid $2,573 of the investment balance in cash, and (ii) issued a senior promissory note (the “2024 Note”) in the aggregate principal amount of $5,146, representing the remaining balance payable under the JKD Investment Agreement. The 2024 Note bears interest at 12% and its principal is to be repaid as follows: (i) $2,573 of the principal amount will be due and payable on August 31, 2025, and (ii) $2,573 will be due and payable on August 31, 2026. The 2024 Note may not be prepaid in whole or in part prior to January 31, 2025. The 2024 Note may, with at least 31 days’ prior written notice to the holder of the 2024 Note, be prepaid in whole or in part at any time following January 31, 2025, without penalty or premium. See notes 4 and 15 to our consolidated financial statements included in this Quarterly Report on Form 10-Q for additional information relating to the Redemption Agreement and 2024 Note.
Current report
Revenues increased by $12,540, or 26%, to $61,057 for the nine months ended September 30, 2024, as compared to $48,517 for the nine months ended September 30, 2023. Each line item is discussed below in more detail.
Current report
Stoa USA Inc. / FlipOS was a private company in which we owned common equity. During the nine months ended September 30, 2023, Stoa USA Inc. / FlipOS announced it had ceased operations and declared bankruptcy. We wrote off our investment in 2023. We have no remaining investment in Stoa USA Inc. / FlipOS.
Current report
Operating expenses increased by $10,472, or 20%, to $63,577 for the nine months ended September 30, 2024, as compared to $53,105 for the nine months ended September 30, 2023. Each line item is discussed below in more detail.
Current report
The large deferred income tax expense recorded in 2023 was mainly the result of an increase in the valuation allowance related to our NOL and NCL tax assets. According to ASC 740*Income Taxes,*we should record an offsetting valuation allowance against these deferred tax assets in an amount such that the net asset recognized represents amounts that we believe are more likely than not to be realized. In making this determination, we must estimate the future amounts of taxable income it will generate in each taxing jurisdiction. We then must consider the remaining statutory time period available for each carryforward asset, as well as other statutory limitations on usage such as annual limits and income type limits (capital vs. ordinary). Due to significant losses incurred in 2023 and prior as well as overall market conditions we face generally, we revised downward in the quarter ended June 30, 2023 the amount of carryforward assets we believed will be realizable in the future above a more likely than not standard. We did not record a similar adjustment in 2024.
Current report
For the Nine Months Ended September 30, 2024
Current report
For the Nine Months Ended September 30, 2023
Current report
Revenues increased by $14,574, or 85%, to $31,695 for the three months ended September 30, 2024, as compared to $17,121 for the three months ended September 30, 2023. Each line item is discussed below in more detail.
Current report
Stoa USA Inc. / FlipOS was a private company in which we owned common equity. During the three months ended September 30, 2023, Stoa USA Inc. / FlipOS announced it had ceased operations and declared bankruptcy. We wrote of our investment in 2023. We have no remaining investment in Stoa USA Inc. / FlipOS.
Current report
Operating expenses increased by $3,248, or 15%, to $24,473 for the three months ended September 30, 2024, as compared to $21,225 for the three months ended September 30, 2023. Each line item is discussed in more detail below.
Current report
Depreciation and amortization increased by $4, or 3%, to $144 for the three months ended September 30, 2024, as compared to $140 for the three months ended September 30, 2023.
Current report
During the nine months ended September 30, 2024:
Current report
During the nine months ended September 30, 2023:
Current report
Nine Months Ended September 30, 2024
Current report
Nine Months Ended September 30, 2023
Current report
During the three months ended September 30, 2024, we repaid our redeemable financial instrument, bringing the balance to $0. As of December 31, 2023, the balance was $7,868. See notes 16 and 24 to our consolidated financial statements included in Item 1 of this Quarterly Report on Form 10-Q.
Removed paragraphs (11)
Previous report
Rising Interest Rates and Inflation
Previous report
Revenues decreased by $2,034, or 6%, to $29,362 for the six months ended June 30, 2024, as compared to $31,396 for the six months ended June 30, 2023. Each line item is discussed below in more detail.
Previous report
Operating expenses increased by $7,224, or 23%, to $39,104 for the six months ended June 30, 2024, as compared to $31,880 for the six months ended June 30, 2023. Each line item is discussed below in more detail.
Previous report
For the Six Months Ended June 30, 2024
Previous report
For the Six Months Ended June 30, 2023
Previous report
Revenues decreased by $11,774, or 52%, to $10,798 for the three months ended June 30, 2024, as compared to $22,572 for the three months ended June 30, 2023. Each line item is discussed below in more detail.
Previous report
Operating expenses increased by $1,592, or 10%, to $17,165 for the three months ended June 30, 2024, as compared to $15,573 for the three months ended June 30, 2023. Each line item is discussed in more detail below.
Previous report
Depreciation and amortization decreased by $24, or 16%, to $125 for the three months ended June 30, 2024, as compared to $149 for the three months ended June 30, 2023.
Previous report
Six Months Ended June 30, 2024
Previous report
Six Months Ended June 30, 2023
Previous report
As of June 30, 2024 and December 31, 2023, we had a redeemable financial instrument payable to JKD Investor. See note 16 to our consolidated financial statements included in Item 1 of this Quarterly Report on Form 10-Q.
Reworded paragraphs (56)
Previous wording
The following discussion and analysis of the consolidated financial condition and results of operations of Cohen & Company Inc. and its majority owned subsidiaries (collectively, “we,” “us,” “our,” or the “Company”) should be read in conjunction with the unaudited consolidated financial statements and the notes thereto appearing elsewhere in this Quarterly Report on Form 10-Q and the audited consolidated financial statements and notes thereto appearing in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.
Current wording
The following discussion and analysis of the consolidated financial condition and results of operations of Cohen & Company Inc. and its consolidated subsidiaries (collectively, “we,” “us,” “our,” or the “Company”) should be read in conjunction with the unaudited consolidated financial statements and the notes thereto appearing elsewhere in this Quarterly Report on Form 10-Q and the audited consolidated financial statements and notes thereto appearing in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.
Previous wording
A portion of our revenue is generated from new issue and advisory engagements. The fees charged and volume of these engagements are sensitive to the overall business environment. We provide origination services in Europe through our subsidiary CCFESA, and new issue and advisory services in the U.S. through our subsidiary JVB. A division of JVB, CCM is our full-service boutique investment bank, which focuses on M&A, underwriting, capital markets and SPAC advisory. Currently, our primary source of new issue and advisory revenue is from investment banking and advisory services through CCM, as well as from originating assets for our U.S. and European insurance asset management business including our U.S. Insurance JV and CREO JV.
Current wording
A portion of our revenue is generated from new issue and advisory engagements. The fees charged and volume of these engagements are sensitive to the overall business environment. We provide origination services in Europe through our subsidiary CCFESA, and new issue and advisory services in the U.S. through our subsidiary JVB. A division of JVB, CCM is our full-service boutique investment bank, which focuses on M&A, underwriting, capital markets and SPAC advisory. Currently, our primary source of new issue and advisory revenue is from investment banking and advisory services through CCM, as well as from originating assets for our U.S. and European insurance asset management business and CREO JV.
Previous wording
A portion of our revenue is generated from management fees. Our ability to charge management fees and the amount of those fees is dependent upon the underlying investment performance and stability of the Investment Vehicles. If these types of investments do not provide attractive returns to investors, the demand for such instruments will likely fall, thereby reducing our opportunity to earn new management fees or maintain existing management fees. As of June 30, 2024, 42% of our existing AUM were in CDOs. The creation of CDOs has depended upon a vibrant securitization market. Since 2008, volumes within the securitization market have dropped significantly and have not fully recovered since that time. We have not completed a new securitization since 2008. The remaining portion of our AUM is from a diversified mix of other Investment Vehicles most of which were more recently formed.
Current wording
A portion of our revenue is generated from management fees. Our ability to charge management fees and the amount of those fees is dependent upon the underlying investment performance and stability of the Investment Vehicles. If these types of investments do not provide attractive returns to investors, the demand for such instruments will likely fall, thereby reducing our opportunity to earn new management fees or maintain existing management fees. As of September 30, 2024, 41% of our existing AUM were in CDOs. The creation of CDOs has depended upon a vibrant securitization market. Since 2008, volumes within the securitization market have dropped significantly and have not fully recovered since that time. We have not completed a new securitization since 2008. The remaining portion of our AUM is from a diversified mix of other Investment Vehicles most of which were more recently formed.
Previous wording
Equity prices of SPACs and post business combination SPACs declined significantly during 2023 and the first six months of 2024. We are exposed to public equity prices of SPACs and post business combination SPACs both through our other investments, at fair value and investments in equity method affiliates. As a result, we recorded significant principal transaction losses and equity method losses during 2023 and the first six months of 2024 in certain SPAC related investments. Continued declines in the equity prices of these companies will result in further losses for us.
Current wording
Equity prices of SPACs and post business combination SPACs declined significantly during 2023 and the first nine months of 2024. We are exposed to public equity prices of SPACs and post business combination SPACs both through our other investments, at fair value and investments in equity method affiliates. As a result, we recorded significant principal transaction losses and equity method losses during 2023 and the first nine months of 2024 in certain SPAC related investments. Continued declines in the equity prices of these companies will result in further losses for us.
Previous wording
During 2022 and 2023, the U.S. Federal Reserve began a process of raising the federal funds rate and quantitative tightening to address rising inflation. These actions have the effect of increasing interest rates, which negatively impacts our business in several ways:
Current wording
During 2022 and 2023, the U.S. Federal Reserve began a process of raising the federal funds rate and quantitative tightening to address rising inflation. Recently, the US Federal Reserve reduced interest rates for the first time in several years. It is unclear as to whether or how quickly interest rates will continue to decline. However, for most of the periods presented herein, rates were rising or elevated versus historical lows, which negatively impacted our business in several ways
Previous wording
SixMonths Ended June 30, 2024 Compared to theSix*** Months Ended June 30, 2023***
Current wording
NineMonths Ended September 30, 2024 Compared to theNine*** Months Ended September 30, 2023***
Previous wording
The following table sets forth information regarding our consolidated results of operations for the six months ended June 30, 2024 and 2023.
Current wording
The following table sets forth information regarding our consolidated results of operations for the nine months ended September 30, 2024 and 2023.
Previous wording
Net trading revenue increased by $3,020, or 19%, to $18,646 for the six months ended June 30, 2024, as compared to $15,626 for the six months ended June 30, 2023. The following table shows the detail by trading group.
Current wording
Net trading revenue increased by $4,345, or 19%, to $27,462 for the nine months ended September 30, 2024, as compared to $23,117 for the nine months ended September 30, 2023. The following table shows the detail by trading group.
Previous wording
Asset management fees increased by $1,165, or 32%, to $4,795 for the six months ended June 30, 2024, as compared to $3,630 for the six months ended June 30, 2023, as discussed in more detail below. The following table provides a more detailed comparison of the two periods.
Current wording
Asset management fees increased by $1,524, or 28%, to $6,942 for the nine months ended September 30, 2024, as compared to $5,418 for the nine months ended September 30, 2023, as discussed in more detail below. The following table provides a more detailed comparison of the two periods.
Previous wording
Asset management fees from CDOs decreased mainly due to paydowns of principal. Asset management fees from other increased primarily due to the recognition in 2024 of deferred performance fees related to certain PriDe Funds and due to the portfolio servicing fee on the notional amount of loans owned by the CREO JV.
Current wording
Asset management fees from CDOs remained relatively flat. Asset management fees from other increased primarily due to the recognition in 2024 of deferred performance fees related to certain PriDe Funds and due to the portfolio servicing fee on the notional amount of loans owned by the CREO JV.
Previous wording
New issue and advisory revenue increased by $28,593, or 1246% to $30,888 for the six months ended June 30, 2024, as compared to $2,295 for the six months ended June 30, 2023. The following table summarizes new issue and advisory revenue by business line.
Current wording
New issue and advisory revenue increased by $43,805, or 459%, to $53,347 for the nine months ended September 30, 2024, as compared to $9,542 for the nine months ended September 30, 2023. The following table summarizes new issue and advisory revenue by business line.
Previous wording
Principal transactions and other income (loss) decreased by $34,812 to ($24,967) for the six months ended June 30, 2024, as compared to $9,845 for the six months ended June 30, 2023. The following table summarizes principal transactions and other income by category.
Current wording
Principal transactions and other income (loss) decreased by $37,134 to ($26,694) for the nine months ended September 30, 2024, as compared to $10,440 for the nine months ended September 30, 2023. The following table summarizes principal transactions and other income by category.
Previous wording
These investments represent our direct and indirect investments in certain public companies. These investments may be in the form of unrestricted common stock, restricted common stock, equity derivatives, convertible notes, non-convertible notes, fair value receivables, as well as equity interest in SPVs that have investments in these public companies. The name and ticker symbol of each public company in which we have a direct or indirect investment is listed in the table above. The amounts shown represent the change in the fair value of our investment in each time period noted in the table. Most of the interests in the public companies listed above were acquired as non-cash compensation related to new issue and advisory engagements. When we received these investments, we recorded new issue and advisory revenue for the fair value of those instruments at that time.
Current wording
These investments represent our direct and indirect investments in certain public companies. These investments may be in the form of unrestricted common stock, restricted common stock, equity derivatives, convertible notes, non-convertible notes, fair value receivables, as well as equity interest in SPVs that have investments in these public companies. The name and ticker symbol of each public company in which we have a direct or indirect investment is listed in the table above. The amounts shown represent the change in the fair value of our investment in each time period noted in the table. Many of the interests in the public companies listed above were acquired as non-cash compensation related to new issue and advisory engagements. When we received these investments, we recorded new issue and advisory revenue for the fair value of those instruments at that time.
Previous wording
Other income / (loss) is comprised of an ongoing revenue share arrangement as well as other miscellaneous operating income items. The revenue share arrangement noted in the table above entitles us to a percentage of revenue earned by IIFC. The IIFC revenue share arrangement expires at the earlier of (i) the dissolution of IIFC or (ii) when we have earned a cumulative $20,000 in revenue share payments. To date, we have earned $7,081. In any particular year, the IIFC revenue share earned by us cannot exceed $2,000.
Current wording
Other income / (loss) is comprised of an ongoing revenue share arrangement as well as other miscellaneous operating income items. The revenue share arrangement noted in the table above entitles us to a percentage of revenue earned by IIFC. The IIFC revenue share arrangement expires at the earlier of (i) the dissolution of IIFC or (ii) when we have earned a cumulative $20,000 in revenue share payments. To date, we have earned $8,133 in connection with this revenue share arrangement.
Previous wording
Compensation and benefits increased by $5,000, or 24%, to $25,538 for the six months ended June 30, 2024, as compared to $20,538 for the six months ended June 30, 2023.
Current wording
Compensation and benefits increased by $7,696, or 22%, to $43,453 for the nine months ended September 30, 2024, as compared to $35,757 for the nine months ended September 30, 2023.
Previous wording
Cash compensation and benefits in the table above was primarily comprised of salary, incentive compensation, severance, employer portion of payroll taxes, and benefits. The change was primarily the result of changes in incentive compensation. Our total headcount increased from 117 at June 30, 2023 to 121 at June 30, 2024. Equity-based compensation remained relatively unchanged.
Current wording
Cash compensation and benefits in the table above was primarily comprised of salary, incentive compensation, severance, employer portion of payroll taxes, and benefits. The change was primarily the result of changes in incentive compensation. Our total headcount decreased from 114 at September 30, 2023 to 113 at September 30, 2024. Equity-based compensation remained relatively unchanged.
Previous wording
Business development, occupancy, and equipment increased by $413, or 16%, to $3,032 for thesix months ended June 30, 2024, as compared to $2,619 for thesix months ended June 30, 2023. This increase was comprised of an increase in occupancy and equipment of $139, and an increase in business development of $274.
Current wording
Business development, occupancy, and equipment increased by $712, or 18%, to $4,599 for thenine months ended September 30, 2024, as compared to $3,887 for thenine months ended September 30, 2023. This increase was comprised of an increase in occupancy and equipment of $287, and an increase in business development of $425.
Previous wording
Subscriptions, clearing, and execution decreased by $165, or 4%, to $4,303 for thesix months ended June 30, 2024, as compared to $4,468 for thesix months ended June 30, 2023. The decrease was due to a decrease in clearing and execution of $247, partially offset by an increase in subscriptions and dues of $82.
Current wording
Subscriptions, clearing, and execution increased by $117, or 2%, to $6,994 for thenine months ended September 30, 2024, as compared to $6,877 for thenine months ended September 30, 2023. The increase was due to an increase in subscriptions and dues of $412, partially offset by a decrease in clearing and execution of $295.
Previous wording
Professional fee and other operating expenses increased by $2,020, or 51%, to $5,982 for thesix months ended June 30, 2024, as compared to $3,962 for thesix months ended June 30, 2023. This increase was comprised of an increase in professional fees of $1,436 and an increase in other operating expense of $584.
Current wording
Professional fee and other operating expenses increased by $1,987, or 32%, to $8,138 for thenine months ended September 30, 2024, as compared to $6,151 for thenine months ended September 30, 2023. This increase was comprised of an increase in professional fees of $1,429 and an increase in other operating expense of $558.
Previous wording
Depreciation and amortization decreased by $44, or 15%, to $249 for the six months ended June 30, 2024, as compared to $293 for the six months ended June 30, 2023.
Current wording
Depreciation and amortization decreased by $40, or 9%, to $393 for the nine months ended September 30, 2024, as compared to $433 for the nine months ended September 30, 2023.
Previous wording
Interest expense, net decreased by $131 to $3,091 for the six months ended June 30, 2024, as compared to $3,222 for the six months ended June 30, 2023.
Current wording
Interest expense, net decreased by $560 to $4,347 for the nine months ended September 30, 2024, as compared to $4,907 for the nine months ended September 30, 2023.
Previous wording
Income / (loss) from equity method affiliates increased by $23,955 to $23,049 for the six months ended June 30, 2024, as compared to ($906) for the six months ended June 30, 2023. See note 11 to our consolidated financial statements included in Item 1 of this Quarterly Report on Form 10-Q.
Current wording
Income / (loss) from equity method affiliates increased by $23,974 to $22,366 for the nine months ended September 30, 2024, as compared to ($1,608) for the nine months ended September 30, 2023. See note 11 to our consolidated financial statements included in Item 1 of this Quarterly Report on Form 10-Q.
Previous wording
Income tax expense / (benefit) decreased by $5,841 to $293 for the six months ended June 30, 2024, as compared to $6,134 for the six months ended June 30, 2023.
Current wording
Income tax expense / (benefit) decreased by $4,944 to $435 for the nine months ended September 30, 2024, as compared to $5,379 for the nine months ended September 30, 2023.
Previous wording
Cohen & Company Inc. consolidates the Operating LLC but only owns a minority economic interest in the Operating LLC. For the six months ended June 30, 2024, Cohen & Company Inc. owned 28.3% of the economic interests of the Operating LLC (on average) and was allocated the same percentage of income/(loss) generated by the Operating LLC. To the extent Cohen & Company Inc. incurs tax obligations on this amount, the related tax expense is recognized in these consolidated financial statements. The remaining 71.7% that was allocated to the non-controlling members of the Operating LLC is subject to taxation on such members' tax returns.
Current wording
Cohen & Company Inc. consolidates the Operating LLC but only owns a minority economic interest in the Operating LLC. For the nine months ended September 30, 2024, Cohen & Company Inc. owned 28.4% of the economic interests of the Operating LLC (on average) and was allocated the same percentage of income/(loss) generated by the Operating LLC. To the extent Cohen & Company Inc. incurs tax obligations on this amount, the related tax expense is recognized in these consolidated financial statements. The remaining 71.6% that was allocated to the non-controlling members of the Operating LLC is subject to taxation on such members' tax returns.
Previous wording
Net income / (loss) attributable to the non-convertible non-controlling interest for the six months ended June 30, 2024 and 2023 was comprised of the non-controlling interest related to member interests in consolidated subsidiaries of the Operating LLC other than interests held by us therein for the relevant periods. These interests are not convertible into Common Stock.
Current wording
Net income / (loss) attributable to the non-convertible non-controlling interest for the nine months ended September 30, 2024 and 2023 was comprised of the non-controlling interest related to member interests in consolidated subsidiaries of the Operating LLC other than interests held by us therein for the relevant periods. These interests are not convertible into Common Stock.
Previous wording
Net income / (loss) attributable to the convertible non-controlling interest for the six months ended June 30, 2024 and 2023 was comprised of the non-controlling interest related to member interests in the Operating LLC other than interests held by us therein for the relevant periods. These interests are convertible into Common Stock. See note 21 to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2023.
Current wording
Net income / (loss) attributable to the convertible non-controlling interest for the nine months ended September 30, 2024 and 2023 was comprised of the non-controlling interest related to member interests in the Operating LLC other than interests held by us therein for the relevant periods. These interests are convertible into Common Stock. See note 21 to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2023.
Previous wording
Net trading revenue increased by $1,382, or 19%, to $8,798 for the three months ended June 30, 2024, as compared to $7,416 for the three months ended June 30, 2023. The following table shows the detail by trading group:
Current wording
Net trading revenue increased by $1,325, or 18%, to $8,816 for the three months ended September 30, 2024, as compared to $7,491 for the three months ended September 30, 2023. The following table shows the detail by trading group.
Previous wording
Asset management fees increased by $473, or 29%, to $2,078 for the three months ended June 30, 2024, as compared to $1,605 for the three months ended June 30, 2023, as discussed in more detail below. The following table provides a more detailed comparison of the two periods:
Current wording
Asset management fees increased by $359, or 20%, to $2,147 for the three months ended September 30, 2024, as compared to $1,788 for the three months ended September 30, 2023, as discussed in more detail below. The following table provides a more detailed comparison of the two periods:
Previous wording
Asset management fees from CDOs decreased mainly due to paydowns of principal. Asset management fees from other increased primarily due to the recognition in 2024 of deferred performance fees related to certain PriDe Funds and due to the portfolio servicing fee on the notional amount of loans owned by the CREO JV.
Current wording
Asset management fees from CDOs remained relatively flat. Asset management fees from other increased primarily due to the recognition in 2024 of deferred performance fees related to a certain PriDe Fund and due to the portfolio servicing fee on the notional amount of loans owned by the CREO JV.
Previous wording
New issue and advisory revenue increased by $5,105 to $6,500 for the three months ended June 30, 2024, as compared to $1,395 for the three months ended June 30, 2023. The following table summarizes new issue and advisory revenue by business line.
Current wording
New issue and advisory revenue increased by $15,212 to $22,459 for the three months ended September 30, 2024, as compared to $7,247 for the three months ended September 30, 2023. The following table summarizes new issue and advisory revenue by business line.
Previous wording
Principal transactions and other income (loss) decreased by $18,734 to ($6,578) for the three months ended June 30, 2024, as compared to $12,156 for the three months ended June 30, 2023. The following table summarizes principal transactions and other income by category:
Current wording
Principal transactions and other income (loss) decreased by $2,322 to ($1,727) for the three months ended September 30, 2024, as compared to $595 for the three months ended September 30, 2023. The following table summarizes principal transactions and other income by category:
Previous wording
These items represent our direct and indirect investments in certain public companies. These investments may be in the form of unrestricted common stock, restricted common stock, equity derivatives, convertible notes, non-convertible notes, fair value receivables, as well as equity interest in SPVs that have investments in these public companies. The name and ticker symbol of each public company in which we have a direct or indirect investment is listed in the table above. The amounts shown represent the change in the fair value of our investment in each time period noted in the table. Most of the interests in the public companies listed above were acquired as non-cash compensation related to new issue and advisory engagements. When we received these investments, we recorded new issue and advisory revenue for the fair value of those instruments at that time.
Current wording
These items represent our direct and indirect investments in certain public companies. These investments may be in the form of unrestricted common stock, restricted common stock, equity derivatives, convertible notes, non-convertible notes, fair value receivables, as well as equity interest in SPVs that have investments in these public companies. The name and ticker symbol of each public company in which we have a direct or indirect investment is listed in the table above. The amounts shown represent the change in the fair value of our investment in each time period noted in the table. Many of the interests in the public companies listed above were acquired as non-cash compensation related to new issue and advisory engagements. When we received these investments, we recorded new issue and advisory revenue for the fair value of those instruments at that time.
Previous wording
Other income / (loss) is comprised of an ongoing revenue share arrangement as well as other miscellaneous operating income items. The revenue share arrangement noted in the table above entitles us to a percentage of revenue earned by IIFC. The IIFC revenue share arrangement expires at the earlier of (i) the dissolution of IIFC or (ii) when we have earned a cumulative $20,000 in revenue share payments. To date, we have earned $7,081. In any particular year, the IIFC revenue share earned by us cannot exceed $2,000.
Current wording
Other income / (loss) is comprised of an ongoing revenue share arrangement as well as other miscellaneous operating income items. The revenue share arrangement noted in the table above entitles us to a percentage of revenue earned by IIFC. The IIFC revenue share arrangement expires at the earlier of (i) the dissolution of IIFC or (ii) when we have earned a cumulative $20,000 in revenue share payments. To date, we have earned $8,133 in connection with this revenue share arrangement.
Previous wording
Compensation and benefits increased by $698, or 7%, to $10,699 for the three months ended June 30, 2024, as compared to $10,001 for the three months ended June 30, 2023.
Current wording
Compensation and benefits increased by $2,696, or 18%, to $17,915 for the three months ended September 30, 2024, as compared to $15,219 for the three months ended September 30, 2023.
Previous wording
Cash compensation and benefits in the table above was primarily comprised of salary, incentive compensation, severance, employer portion of payroll taxes, and benefits. The change was primarily the result of changes in incentive compensation. Our total headcount increased from 117 at June 30, 2023 to 121 at June 30, 2024. Equity-based compensation remained relatively unchanged.
Current wording
Cash compensation and benefits in the table above was primarily comprised of salary, incentive compensation, severance, employer portion of payroll taxes, and benefits. The change was primarily the result of changes in incentive compensation. Our total headcount decreased from 114 at September 30, 2023 to 113 at September 30, 2024. Equity-based compensation remained relatively unchanged.
Previous wording
Business development, occupancy, and equipment increased by$273, or 21%, to$1,591 for the three months ended June 30, 2024, as compared to$1,318 for the three months ended June 30, 2023. This increase was comprised of an increase in occupancy and equipment of $54, and an increase in business development of $219.
Current wording
Business development, occupancy, and equipment increased by$299, or 24%, to$1,567 for the three months ended September 30, 2024, as compared to$1,268 for the three months ended September 30, 2023. This increase was comprised of an increase in occupancy and equipment of $148, and an increase in business development of $151.
Previous wording
Subscriptions, clearing, and execution decreased by$126, or 5%, to$2,217 for the three months ended June 30, 2024, as compared to$2,343 for the three months ended June 30, 2023. The decrease was due to a decrease in clearing and execution of $143, partially offset by an increase in subscriptions and dues of $17.
Current wording
Subscriptions, clearing, and execution increased by$282, or 12%, to$2,691 for the three months ended September 30, 2024, as compared to$2,409 for the three months ended September 30, 2023. The increase was comprised of an increase in subscriptions and dues of $330, partially offset by a decrease in clearing and execution of $48.
Previous wording
Professional fees and other operating expenses increased by$771, or 44%, to$2,533 for the three months ended June 30, 2024, as compared to$1,762 for the three months ended June 30, 2023. This increase was comprised of an increase in professional fees of $787, partially offset by a decrease in other operating expense of $16.
Current wording
Professional fees and other operating expenses decreased by$33, or 2%, to$2,156 for the three months ended September 30, 2024, as compared to$2,189 for the three months ended September 30, 2023. This decrease was comprised of a decrease in professional fees of $7 and a decrease in other operating expense of $26.
Previous wording
Interest expense, net decreased by $205 to $1,425 for the three months ended June 30, 2024, as compared to $1,630 for the three months ended June 30, 2023.
Current wording
Interest expense, net decreased by $429 to $1,256 for the three months ended September 30, 2024, as compared to $1,685 for the three months ended September 30, 2023.
Previous wording
Income / (loss) from equity method affiliates decreased by $5,485 to ($5,996) for the three months ended June 30, 2024, as compared to ($511) for the three months ended June 30, 2023. See note 11 to our consolidated financial statements included in Item 1 of this Quarterly Report on Form 10-Q.
Current wording
Income / (loss) from equity method affiliates increased by $19 to ($683) for the three months ended September 30, 2024, as compared to ($702) for the three months ended September 30, 2023. See note 11 to our consolidated financial statements included in Item 1 of this Quarterly Report on Form 10-Q.
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