Jefferies(JEF) - 2025 Q4 - Annual Results

Financial Performance - Net earnings attributable to common shareholders for Q4 2025 were $190.89 million, or $0.87 per diluted share, compared to $205.75 million, or $0.91 per diluted share in Q4 2024[2]. - Adjusted net earnings attributable to common shareholders for Q4 2025 were $213.46 million, or $0.96 per diluted share, reflecting a strong performance despite a $30 million markdown related to Point Bonita[4]. - Total net revenues for Q4 2025 were $2.07 billion, up 5.7% from $1.96 billion in Q4 2024, driven by a 20% increase in Investment Banking net revenues[2][4]. - Investment Banking net revenues reached $1.19 billion in Q4 2025, a 20% increase year-over-year, with strong performance in Advisory services[5][12]. - Capital Markets net revenues were $692 million, up 6% from the prior year quarter, with Equities net revenues growing 18%[6][12]. - Asset Management net revenues were $186.99 million, down from $314.75 million in Q4 2024, primarily due to a pre-tax loss of $30 million related to Point Bonita[7][12]. - Net earnings attributable to common shareholders for the three months ended November 30, 2025, were $190,890, compared to $205,746 in the prior year, a decrease of 7.2%[21]. - Adjusted net earnings attributable to common shareholders for the three months ended November 30, 2025, were $213,460, compared to $205,747 in 2024, an increase of 3.3%[24]. Shareholder Returns - The company declared a quarterly cash dividend of $0.40 per common share, payable on February 27, 2026[3]. - Preferred stock dividends for the year ended November 30, 2025, were $79.68 million, an increase from $74.11 million in 2024[25]. Tax and Expenses - The effective tax rate from continuing operations was 14.8%, significantly lower than 28.2% in the prior year quarter, primarily due to the resolution of certain tax matters[13]. - Compensation and benefits expense as a percentage of net revenues increased to 52.2%, compared to 50.2% for the prior year quarter[4]. - Non-compensation expenses as a percentage of net revenues rose to 35.5%, up from 34.2% in the prior year quarter, reflecting increased brokerage and clearing fees due to higher equities trading volumes[4]. Asset and Leverage Metrics - Total assets as of November 30, 2025, were $76,012,000, compared to $64,360,000 in the prior year, reflecting a growth of 18.1%[20]. - The leverage ratio increased to 7.1 from 6.3 in the prior year, indicating a higher level of debt relative to equity[20]. Market Strategy - Jefferies is focused on technology investments to enhance productivity and client solutions, aiming for long-term growth and market share gains[8]. Adjusted Metrics - The return on adjusted tangible shareholders' equity from continuing operations was 11.8%, with an adjusted return of 12.9% after excluding the impact of the Point Bonita markdown[4][13]. - Adjusted net earnings excluding Point Bonita loss for Q4 2025 were $249.09 million, up 7.1% from $232.44 million in Q4 2024[25]. - The adjusted return on adjusted tangible shareholders' equity from continuing operations for Q4 2025 was 12.9%, compared to 12.7% in Q4 2024[25]. - Adjusted tangible book value increased to $8.65 billion in Q4 2025, up 5.3% from $8.22 billion in Q4 2024[26]. Trading and Risk Metrics - The number of trading days for the three months ended November 30, 2025, was 63, consistent with the same period in 2024[20]. - The average Value at Risk (VaR) for the three months ended November 30, 2025, was $9.50 million, down from $10.45 million in the prior quarter[20].