Cohen & Company Reports 85% Revenue Growth, Turnaround in Operating Income and Net Income in Q3 2024

Cohen & Company Inc. reported significant financial improvements for the three and nine months ended September 30, 2024, compared to the same periods in 2023. Total revenues for the third quarter reached $31.7 million, an increase of 85% from $17.1 million in Q3 2023. For the nine months, revenues rose 26% to $61.1 million from $48.5 million. This growth was driven primarily by a substantial increase in new issue and advisory revenues, which surged 210% to $22.5 million in Q3 and 459% to $53.3 million for the nine-month period.

Net trading revenues also saw a notable increase, rising 18% to $8.8 million in Q3 and 19% to $27.5 million for the nine months. The Capital Markets segment was the largest contributor, generating $80.8 million in revenues for the nine months, while the Asset Management segment contributed $9.5 million. However, the Principal Investing segment reported a loss of $29.3 million for the same period, reflecting challenges in the SPAC-related investments.

Cohen & Company achieved an operating income of $7.2 million in Q3 2024, a significant turnaround from an operating loss of $4.1 million in Q3 2023. For the nine months, operating income improved to $7.5 million from $7.3 million in the prior year. Net income for Q3 was $5.1 million, compared to a loss of $5.7 million in Q3 2023, while net income for the nine months was $15.1 million, a stark contrast to a loss of $16.5 million in the same period last year.

The company’s total assets increased to $818.0 million as of September 30, 2024, up from $772.8 million at the end of 2023. Cash and cash equivalents also rose to $14.3 million from $10.7 million. Notably, the company redeemed the JKD Investment Agreement effective September 1, 2024, resulting in a cash payment of $2.6 million and the issuance of a senior promissory note for the remaining balance.

Cohen & Company continues to navigate a challenging market environment, particularly in the fixed income brokerage sector, where margin pressures are increasing. The company is diversifying its trading platform and expanding product lines to mitigate these pressures. Additionally, rising interest rates have negatively impacted the fair value of fixed income securities, which could further affect profitability.

Overall, Cohen & Company Inc. has demonstrated a strong recovery in revenue and profitability, driven by strategic growth in its Capital Markets and advisory services, despite ongoing challenges in certain investment segments.