Cohen & Company (COHN) Q2 2024 earnings summary

Executive summary

• Reported a Q2 2024 net loss attributable to the company of $2.3 million ($1.47 per diluted share), compared to net income of $2 million in the prior quarter and net loss of $6.6 million in the prior year quarter.

• For the six months ended June 30, 2024, revenue decreased 6% to $29.4 million, with a net loss of $0.3 million, a significant improvement from a $9.2 million loss in the prior year period.

• CCM generated $6.4 million in advisory revenues, led two SPAC IPOs, and expanded its team to 24 professionals.

• Principal investment portfolio experienced significant mark-to-market losses, especially in SPAC and public equity investments, weakening results.

• Board declared a quarterly dividend of $0.25 per share, payable September 5, 2024, and remains focused on enhancing long-term value for stockholders.

Financial highlights

• Net loss attributable to the company was $2.3 million for Q2 2024; adjusted pre-tax loss was $8.6 million.

• Six-month net trading revenue was $18.6 million (+19% year-over-year); asset management revenue was $4.8 million (+32%).

• New issue and advisory revenue for Q2 was $6.5 million, down $17.9 million from the prior quarter but up $5.1 million year-over-year.

• Principal transactions and other revenue was negative $6.6 million in Q2 2024 due to mark-to-market losses on SPAC-related investments.

• Operating expenses for the six months were $39.1 million (+23% year-over-year), with compensation and benefits at $25.5 million.

Outlook and guidance

• Management expects continued volatility in new issue and advisory revenue due to reliance on a limited number of engagements and market conditions.

• Asset management revenue is expected to decline as CDO assets mature, with future growth dependent on new securitizations and investment vehicles.

• Principal investing results remain highly sensitive to SPAC market activity and public equity valuations.

• Management remains confident in future earnings potential and is focused on enhancing long-term value for stockholders, including continued dividend payments.

• Optimism expressed for CCM's pipeline and consistent production through year-end.