Jefferies Financial Group Inc. · NYSE:JEF
Jefferies Financial — Investor Day (October 2018)
108 slides from Jefferies Financial's investor day presentation, Oct 4, 2018
Slide 1: Jefferies Financial Group Inc. 2018 Investor Meeting
Jefferies Financial Group Inc. 2018 Investor Meeting October 4, 2018
Slide 2: Note on Forward Looking Statements
Note on Forward Looking Statements Certain statements contained herein may constitute "forward-looking statements," within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 and/or the Private Securities Litigation Reform Act of 1995, regardi
Slide 3: 2018 Investor Meeting Agenda
2018 Investor Meeting Agenda Start Time End Time Session Speaker(s) 9:00 AM 9:30 AM Overview Rich Handler, CEO Brian Friedman, President Teri Gendron, CFO Jefferies Group LLC 9:30 AM 9:45 AM Operating Results Peg Broadbent, CFO (Jefferies Group LLC) 9:45 AM 10:00 AM Investment Banking Ben Lorello, G
Slide 4: 2018 Investor Meeting Agenda (Continued)
2018 Investor Meeting Agenda (Continued) Start Time End Time Session Speaker(s) Merchant Banking Business 12:00 PM 12:10 PM National Beef Nick Daraviras, Managing Director 12:10 PM 12:20 PM Idaho Timber Nick Daraviras, Managing Director 12:20 PM 12:30 PM Spectrum Brands Andrew Whittaker, Vice Chairm
Slide 5: Evolution of Jefferies Financial Group
Evolution of Jefferies Financial Group Transformative steps have confirmed and clarified our focus on financial services ─ Jefferies Group continues its strong performance, led by the expansion of Investment Banking into new sub-sectors and geographies: August 31, 2018 LTM Net Revenues of $3.2 bil
Slide 6: Jefferies Financial Group Overview
Jefferies Financial Group Overview As of 6/30/18, Pro Forma(1) Liquidity & Jefferies Financial Group Corporate (Net) $1.9 Billion Net Parent Capital – $10.8 Billion Equity(2); $1.0 Billion Parent Debt Corporate Assets(3) Investment Banking, Capital Markets & Merchant Banking Asset Management $6.4 Bi
Slide 7: Global Full-Service Capabilities
Global Full-Service Capabilities Leucadia Asset Investment Banking Equities Fixed Income Management(1) Equity Cash Electronic Leveraged Investment Weiss Multi- Consumer Energy Capital quantPORT Equities Trading Credit Grade Strategy Markets Debt Capital Listed Prime Emerging MBS / ABS / Financials H
Slide 8: Jefferies Group: Performance Update
Jefferies Group: Performance Update Focused on revenue growth and margin expansion; last nine quarters demonstrate consistency of results from expansion and improvements We continue to build a leading, client-focused global investment banking firm, seeking to provide clients with the best ideas,
Slide 9: Jefferies Group: Priorities
Jefferies Group: Priorities Our priorities are revenue growth and margin expansion, while maintaining our discipline around liquidity and risk management ─ Highest priority is revenue growth led by Investment Banking maturation and continuing new hires ─ Equities and Fixed Income are pursuing mark
Slide 10: The Path to Simplification and Greater Transparency
The Path to Simplification and Greater Transparency 2013 2014 2015 2016 2017 2018 YTD 2018 Q4 2013 2013 Expanded information provided during Annual Shareholders Meeting 2014 2014 Investor Days began 2015 2015 Enhanced financial disclosures First analyst initiated coverage (Oppenheimer) 2016 2016 Jef
Slide 11: A Fair Value Perspective on Our Merchant Banking Business
A Fair Value Perspective on Our Merchant Banking Business As of June 30, 2018(1) ($ Millions) Estimated Book Value Fair Value Basis for Fair Value Estimate Investments in Public Companies Spectrum Brands $610 $610 Mark-to-market HomeFed 346 599 Mark-to-market (equity method for GAAP book value) Othe
Slide 12: Share Repurchase
Share Repurchase During the first nine months of 2018, we have repurchased 26 million Jefferies Financial Group shares (over 7% of shares outstanding as of January 1, 2018) for a total of Fully Diluted Tangible Shares $636 million, or an average price of $24.16 per share Book Value Outstanding Ful
Slide 13: Jefferies Group LLC
Jefferies Group LLC Jefferies
Slide 14: Financial Overview
Financial Overview Jefferies
Slide 15: Operating Results
Operating Results ($ Millions) Jefferies Group LLC FYE Nov. 30, Twelve Months Ended 2016 2017 8/31/2018 Equities $597 $674 $683 Fixed Income 654 618 574 Total Sales and Trading 1,252 1,293 1,257 Equity 235 345 449 Debt 305 649 658 Capital Markets 540 994 1,107 Advisory 654 770 828 Other Investment B
Slide 16: Balance Sheet
Balance Sheet As of August 31, 2018 ($ Millions) Jefferies Group LLC Balance Sheet as of 8/31/2018 Assets Liabilities and Equity Cash & Cash Equivalents $ 4,813 Short-term Borrowings $ 382 Cash & Securities Segregated 913 Financial Instruments Sold, Not Yet Purchased 8,128 Financial Instruments Owne
Slide 17: Limited Leverage
Limited Leverage We have a long-standing policy of carefully managing balance sheet leverage In periods of stress, we have demonstrated the ability to rapidly reduce leverage without unduly impacting our business Historical Quarterly Leverage(1) ($ Millions) $45,000 12.0x $40,000 11.0x $35,000 1
Slide 18: Return on Tangible Equity
Return on Tangible Equity Jefferies Group has tangible Jefferies Group LLC member’s equity of $3.7 billion as of August 31, 2018, excluding $1.8 billion of goodwill and intangibles related to the 2013 merger with Jefferies Financial Group Over the past seven quarters, Jefferies Group’s Return on
Slide 19: Level 3 Trading Assets Overview
Level 3 Trading Assets Overview 98% of inventory is Level 1 or 2, with a minimal amount of Level 3 Trading Assets at 8/31/18 Level 3 Trading Assets were $311 million at 8/31/18, representing only 8.4% of tangible Jefferies Group LLC member’s equity Level 3 Financial Instruments Owned as a Percen
Slide 20: Investment Banking
Investment Banking Jefferies
Slide 21: Investment Banking – Overview
Investment Banking – Overview Jefferies Investment Banking is a leading advisor and underwriter to our clients globally 822 investment bankers with deep sector expertise and extensive experience across major industry verticals On-the-ground presence in 13 countries across the world 75% of ou
Slide 22: Investment Banking – Sector, Product, and Regional Expansion
Investment Banking – Sector, Product, and Regional Expansion Since the beginning of fiscal 2017, we have expanded our Managing Director footprint across sectors, products and geographies Expanded our sector footprint in Industrials, Consumer, Technology, Financial Services and Municipal Finance
Slide 23: Investment Banking – Performance Update
Investment Banking – Performance Update Our investment banking revenues for the nine months ended fiscal 2018 increased 12% compared to the nine months ended fiscal 2017 and for the LTM Q3 2018 increased 16% compared to the same period in 2017 Our performance was driven by significant revenue in
Slide 24: Investment Banking – U.S. Fee Market Share LTM 8/31/18
Investment Banking – U.S. Fee Market Share LTM 8/31/18 Revenue growth has resulted in a significant increase in our U.S. market share across all major products M&A ECM Leveraged Finance Market ∆ From Market ∆ From Market ∆ From Share Investment Market LTM Q3 Share Investment Market LTM Q3 Share In
Slide 25: Jefferies Finance – Overview
Jefferies Finance – Overview Jefferies Finance LLC Jefferies Finance, our corporate lending joint venture with Massachusetts Mutual Life Insurance Company, continues to grow steadily and prudently ─ Established in 2004, Jefferies Finance has demonstrated growth and resilience across multiple busin
Slide 26: Investment Banking – Strategic Priorities
Investment Banking – Strategic Priorities Continue to increase the productivity of our sector MDs Capitalize on the significant revenue opportunities in recently entered sectors, products and regions Drive further market share gains in M&A by leveraging our increased coverage footprint and con
Slide 27: Equities
Equities Jefferies
Slide 28: Equities – Overview
Equities – Overview Global Equities at Jefferies is a leading client franchise that continues to grow strategically. With Sales, Trading and Advisory capabilities across North America, Europe and Asia, and with major trading hubs in New York, London and Hong Kong, we are well-equipped to serve our
Slide 29: Equities – Performance and Market Share
Equities – Performance and Market Share Our Global Businesses have Demonstrated Significant Growth in Market Share. Our growth is largely driven by our client focus, enhanced global capabilities, and the momentum of the overall Jefferies platform. We have considerably diversified our business, with
Slide 30: Equities – The Remaining Wallet and Growth Strategy
Equities – The Remaining Wallet and Growth Strategy Our Strategy is to Focus on Deeper Client Penetration across Global Cash Equities and Further Developing our Client Offering across Non-Cash Products. Non-Cash Products represent approximately 72% of the overall Global Equities wallet. Leveraging o
Slide 31: Equities – Strategic Priorities
Equities – Strategic Priorities We are Focused on Healthy & Sustainable Growth in our Global Equities Franchise. Our strategic priorities are across our Advisory & Execution businesses and cross-functionally across Human Capital Management and cross-selling new & existing products. Global Non-Cash P
Slide 32: Fixed Income
Fixed Income Jefferies
Slide 33: Fixed Income – Overview
Fixed Income – Overview Jefferies serves clients across all major cash products in the U.S. and Europe ─ 435 sales, trading, capital markets, research and strategy professionals globally ─ Primary Dealer or equivalent in U.S., U.K., Germany, Netherlands, Portugal and Slovenia ─ Focused on providin
Slide 34: Fixed Income – Positioned and Focused
Fixed Income – Positioned and Focused The realignment of resources that began in late 2015 is yielding more consistent revenues and returns Focus on sales and trading of cash products across the fixed income landscape More consistent revenues on lower cost, balance sheet, capital and risk Fixed
Slide 35: Fixed Income – Market Share Growth
Fixed Income – Market Share Growth Key Highlight Focus on Quality Share vs. Market Share Emerging Markets: Leveraged Finance: #1 Dealer for Most Helpful Traders, including Top 2 (Greenwich Survey 2018) Jefferies ranks #1 in US LBO loans for YTD 2018, with total deal volume #4 Dealer for Mo
Slide 36: Fixed Income – Strategic Priorities
Fixed Income – Strategic Priorities Drive consistent results by continuing to emphasize our long-standing client centric strategy Quality Share vs. Market Share Building deeper partnerships with targeted clients Highly productive balance sheet with emphasis on high turnover inventory Invest
Slide 37: Berkadia
BERKADIA Jefferies
Slide 38: Company Overview
Company Overview Berkadia is a full-service mortgage banking firm that provides clients best of class services and products in middle market mortgage finance, advisory and servicing Business Lines: ─ Permanent and construction commercial real estate loans ─ Investment Sales broker for multifamil
Slide 39: Industry Update
Industry Update Long-Term Market Growth Maturities of non-bank Commercial/Multifamily mortgages grow 60% over next 6 years to $160 billion Multifamily maturities grow by 3x to $75 billion in same period GSE and HUD specific maturities follow similar trajectory Principal Balance of Non-Bank Com
Slide 40: Financial Performance
Financial Performance Loan Originations Revenue ($ Billions) ($ Millions) $30.0 $1,000 $24.5 $825 $25.0 $22.0 $800 $706 $725 $19.5 $20.0 $608 $600 $531 $15.0 $12.8 $434 $426 $11.3 $9.5 $10.4 $9.3 $400 $348 $10.0 $5.0 $200 $- $- 2012 2013 2014 2015 2016 2017 1H 1H 2012 2013 2014 2015 2016 2017 1H 1H
Slide 41: Servicing Portfolio
Servicing Portfolio Our servicing portfolio has experienced nearly complete turnover since the inception of the Company. Unpaid principal balance as of June 30, 2018 was $216 billion; $203 billion, or 94%, relate to loans added since initial acquisition (2009) Change in mix of servicing portfo
Slide 42: 2018 Update
2018 Update 1H 2018 Core cash earnings growth of 27% to $70 million. This was driven by a shift in servicing portfolio mix toward loans with higher weighted average service fees, as well as a 23% increase in origination cash fees YoY Improved productivity of Bankers / Sales Advisors. Annualized
Slide 43: Goals and Priorities
Goals and Priorities Our Long-Term Goals ─ Be the No. 1 Fannie Mae, Freddie Mac, and HUD lender by combined volume (3rd in 2017) ─ Transform the commercial real estate finance industry through innovation, technology and data ─ Drive process excellence throughout the firm Our Priorities ─ Help ou
Slide 44: Leucadia Asset Management
Leucadia Asset Management 42
Slide 45: Leucadia Asset Management – Overview
Leucadia Asset Management – Overview Diversified alternative asset management platform – supporting and developing focused funds and managed accounts managed by distinct management teams ─ Includes all asset management activities within the firm, including investments and strategic relationships w
Slide 46: Leucadia Asset Management – Recent Developments
Leucadia Asset Management – Recent Developments January 2018: Launch of Tenacis comingled fund April 2018: quantPORT re-branding and growth initiative ─ Re-branded quantPORT from Strategic Investment Division ─ Focus on further scaling the successful quantitative investment platform April 2018
Slide 47: Leucadia Asset Management – Select Platforms and Strategies
Leucadia Asset Management – Select Platforms and Strategies Asset Class NAV(1) ($ Billions) Founded Description Multi $0.5 2002 First-loss, scalable multi-manager and multi-strategy liquid securities fund Multi-PM (2) Multi $1.7 1978 Multi-strategy asset manager with 40 year track-record Pendi
Slide 48: Risk Management
Risk Management Jefferies
Slide 49: Risk Management Framework
Risk Management Framework Jefferies' comprehensive risk management framework has been a foundation for our success across market cycles Our Risk Management Principles ─ Robust risk culture ─ Hands on approach to risk management ─ Independent and integrated ─ Asset quality Risk Governance and Ris
Slide 50: Risk Management Committee Structure
Risk Management Committee Structure Jefferies Group Board of Directors Corporate Compensation Audit Governance and Firm Management Nominating Chief Risk Officer / Risk Management Operating Executive Global Treasurer Firmwide Committees Model Independent Vendor Risk Asset / Governance Price New Busin
Slide 51: VaR Report
VaR Report Quarterly VaR Average ($ Millions) 15 Avg. VaR related to KCG Avg. Firmwide VaR Excl. KCG 10 5 0 Annual VaR Average ($ Millions) 15 Avg. VaR related to KCG Avg. Firmwide VaR Excl. KCG 10 5 0 2015 2016 2017 YTD 8/31/18 49
Slide 52: VaR Report and Trading Revenues
VaR Report and Trading Revenues Distribution of Daily Net Trading Revenues (Excluding KCG Holdings)(1) 2015 2016 2017 YTD 8/31/18 120 100 80 # of Days 60 40 20 0 <(8) (8)-(4) (4)-(0) 0-4 4-8 8-12 12-16 16-20 >20 $ Millions Historical Negative Trading Revenues Days 2015 2016 2017 2018 Q1 Q2 Q3 Q4 Q1
Slide 53: Capital and Liquidity Management
Capital and Liquidity Management 51
Slide 54: Liquidity and Funding Principles
Liquidity and Funding Principles Jefferies’ long-standing liquidity and funding principles have maintained the strength and soundness of our platform across market cycles Owning inventory that is composed of liquid assets that turn over regularly, with Level 3 assets at 2.0% of inventory as of 8/3
Slide 55: Fundability of Collateral
Fundability of Collateral % of Assets With Secured Funding (as of 8/31/18) Tier 3: Non-IG Fixed Tier 4: Corporate Income, Convertibles, Loans, Mortgage Whole Loan Distressed Debt 10.4% and Equities, Investments, CLO/CDO Equity 1.5% Tier 2: Agency CMO's, IG Fixed Tier 1: CCP Eligible Income, Listed 5
Slide 56: Global and Legal Entity Liquidity Stress Model
Global and Legal Entity Liquidity Stress Model Stress test contingency liquidity outflows at the global and regional level ─ 100% loss of non-cleared repo and stock loan ─ Higher margins at CCP’s and clearing organizations ─ 100% loss of customer credit balances ─ Buy back Jefferies debt for marke
Slide 57: Long-Term Debt Profile
Long-Term Debt Profile As of 8/31/18, our $6.4 billion carrying value of long-term debt had a weighted average maturity of approximately 8.8 years No maturity of long-term debt in a single year is greater than 20% of outstanding long-term debt 2019 maturity has been pre-funded and will be paid
Slide 58: Q & A’s – IRQuestions@Jefferies.com
Q & A’s – IRQuestions@Jefferies.com
Slide 59: Merchant Banking
Merchant Banking Jefferies
Slide 60: National Beef
ational DeEI. By. NS y ina Jefferies
Slide 61: Company Overview
Company Overview 4th Largest U.S. Beef Company ─ LTM 6/30/18 Sales – $7.7 Billion ─ Market Share – ~12.5% ─ Employees – ~8,100 #1 U.S. Exporter of Chilled Beef ─ Market Share – 26% 2nd Largest U.S. Hide Tanner ─ Market Share – 33% Intensely Focused on Value-Added Production LTM 06/30/18 EB
Slide 62: 2018 Transaction Highlights
2018 Transaction Highlights In June, we closed the sale of 48% of National Beef to Marfrig, a Brazilian beef packer, for $908 million in cash, reducing our ownership to 31% and allowing us to deconsolidate National Beef ─ We received an additional $229 million in pre-closing distributions, reflect
Slide 63: 2018 Operating Update
2018 Operating Update In LTM 6/30/18, National Beef’s EBITDA margin improved to 8.4% vs. 6.9% in the prior year period (LTM 6/30/17), while total volume was up 4.3% based on equivalent weeks The domestic supply of fed cattle continued to increase in 2018, supporting greater capacity utilization
Slide 64: Cattle Supply Update
Cattle Supply Update The increasing supply of slaughter-ready cattle is Recent USDA cattle inventory expected to support continued strong profitability reports confirm that the for at least the next several years domestic beef cowherd continues to grow, albeit at a U.S. Steer and Heifer Slaughter
Slide 65: Financial Performance
Financial Performance Pre-Tax Income ($ Millions) $407.3 $329.0 $257.5 $135.5 ($123.9) 2015 2016 2017 1H 2017 1H 2018 Adjusted EBITDA(1) ($ Millions) $512.1 $436.3 $314.2 $186.3 ($13.3) 2015 2016 2017 1H 2017 1H 2018 (1) Non-GAAP measure. See Appendix on page 99 for reconciliation to GAAP amounts. 6
Slide 66: Strategic Priorities
Strategic Priorities Explore the benefits of partnership with Marfrig Focus on additional value-added production ─ Ongoing marketing to retailers and food service providers of consumer-ready, portion-controlled and other value-added product lines ─ As capacity utilization increases, seek margin
Slide 67: Idaho Timber
}) IDAHO TIMBER Jefferies
Slide 68: Overview
Overview Manufacturer and distributor of wood products ─ Complementary Remanufacturing and Sawmill segments 7 plants and 3 sawmills located in 7 states ─ ~1.0 billion board feet of capacity Remanufacturing segment ─ Purchase low value dimension lumber and remanufacture to add value for pro dea
Slide 69: Recent Developments and Performance
Recent Developments and Performance Overall housing demand continues slow rebound from recessionary lows Softwood Lumber Agreement between U.S. and Canada expired and a tariff on imported lumber has been imposed – while this limits volume of low-grade Canadian lumber, the effect on Idaho Timber’
Slide 70: Strategic Priorities
Strategic Priorities Opportunistically invest in new capacity Focus on timely purchasing opportunities to enhance revenue and margins Continue to improve efficiency at primary sawmills Continue to reposition operations to increase spread and volumes in remanufacturing segment Continue to w
Slide 71: Spectrum Brands
Spectrum Brands Jefferies
Slide 72: Company Update – HRG Group Merged into Spectrum Brands
Company Update – HRG Group Merged into Spectrum Brands In July, HRG Group merged into its consolidated subsidiary, Spectrum Brands, a global and diversified consumer products company and a member of the Russell 1000 Index Since Jefferies Financial Group initially invested in HRG in 2014 / 2015:
Slide 73: Financial Overview
Financial Overview Net Sales Adjusted EBITDA(4) & Margin ($ Millions) ($ Millions) $311 $317 $2,010 $1,998 $1,997 15.5% 15.5% $273 $2,092 $307 13.7% $2,231 $2,250 $2,204 $307 $304 $327 14.7% 13.8% 14.7% 13.6% $2,254 $307 $642 $639 $603 $3,030 $3,009 $3,145 13.6% $494 21.2% 21.2% $2,598 $361 $373 $39
Slide 74: Vitesse
Vitesse L_____energy finance Jefferies
Slide 75: Company Overview
Company Overview Vitesse Energy Finance has invested $439 million to acquire, develop and produce cash flow from oil and gas properties in proven, lower risk oil and gas fields in the growing core of the Bakken Oil Field Vitesse, as a financial non-operating owner, partners with leading Bakken o
Slide 76: Company Overview (Continued)
Company Overview (Continued) Vitesse has hedged substantially all current and the majority of its anticipated new production in the second half of 2018 and all of 2019 with price floors on average of $58.60/Bbl and $53.35/Bbl, respectively $87.3 million of annualized Q2 2018 Adjusted EBITDA(1) r
Slide 77: Strong Bakken Economics – Leveraged to Technology & Prices
Strong Bakken Economics – Leveraged to Technology & Prices Average Bakken Estimated Average Ultimate Bakken Recovery (MBOE) EUR (MBOE) Average Bakken Well Cost Average Bakken Well Cost ($000's) ($ Thousands) 1,400 $9,000 $8,285 $8,000 1,200 $8,000 1,200 $7,297 980 $7,000 1,000 $6,117 900 $5,683 $6,0
Slide 78: Financial Performance
Financial Performance As of July 31, 2018: Approximately 44,000 net acres primarily in the core of the Bakken 4,340 gross producing wells (88 net) 893 permitted, drilling or completing wells (23.66 net, of which 13.14 are completing) 300+ net future drilling locations ($2.0 billion of estima
Slide 79: Strategic Priorities
Strategic Priorities Profitably grow production, EBITDA and pre-tax income ─ Reinvest and compound our cash flow in the Bakken Invest in high return development wells with best operators at compelling valuations ─ Leverage our data base / knowledge to acquire acreage inexpensively, where technol
Slide 80: HomeFed
Jefferies
Slide 81: Company Overview
Company Overview HomeFed is a public company (OTC:HOFD), 70% owned by Jefferies Financial Group, that develops and owns residential and mixed-use real estate projects in California, New York, Florida, South Carolina, Virginia and Maine; after many years in the entitlement process, vast majority of
Slide 82: Project Status
Project Status Property Development / Operating Phase Entitlement Land Active Lot / Operating Process Development Home Sales Asset Otay Ranch ~4,450 acres of entitled land in Chula Vista, CA Renaissance Plaza Mixed use (office, Marriott hotel and garage) asset in Brooklyn, NY The Market Common ~110
Slide 83: Otay Ranch
Otay Ranch HomeFed acquired 4,800 acres in Otay Ranch in 1998 and began entitling for development. In 2015, HomeFed acquired another 1,600 contiguous acres from State Street Bank In total, HomeFed holdings in Otay Ranch include approximately 6,200 acres, planned and entitled for approximately 13
Slide 84: Other Developments
Other Developments HomeFed closed a $198 million refinancing of an office condominium in Brooklyn Renaissance Plaza that provided net proceeds of $88 million to HomeFed in February 2018 Further streamlined operations when it ceased farming operations with the sale of the Rampage property for $26
Slide 85: Strategic Priorities
Strategic Priorities Monetize land assets Optimize Otay Ranch assets – focus on expediting development programs and maximizing revenue over the coming years ─ Continue to monetize Village of Escaya home sales and future village developments through sales and partnerships with top tier builders ─ P
Slide 86: FXCM
” F—-xcm Jefferies
Slide 87: Company Overview
Company Overview FXCM Group LLC is a leading online provider of foreign exchange trading services to approximately 109,000(1) active retail trading accounts outside the U.S. Multi-asset class product offering – with approximately 70% of volumes in OTC Spot FX and 30% in contracts for difference
Slide 88: Financial Performance
Financial Performance Adjusted EBITDA(1) of $10.1 million on revenues of $81.2 million for first half of 2018 Operating expense trend reflects continued focus on cost reduction ─ Adjusted operating expenses(1) of $33.3 million for Q2’18 down 14% from 2017 quarterly average $98 million in opera
Slide 89: Industry & Business Update
Industry & Business Update Currency volatility (“CVIX”) in 2018 has remained near-record low levels Monthly Average JP Morgan Global FX CVIX 12.0 10.0 8.0 6.0 The European Securities and Markets Authority put in place new rules effective August 1st that lowers the amount of leverage available to
Slide 90: Strategic Priorities
Strategic Priorities Continue focus on costs / well positioned to capitalize when volatility improves Advance new enhanced algorithmic and API offerings Promotion of new HTML5 web-based platform Improve CFD pricing Expand on Crypto CFD offering (Bitcoin launched in July 2018) Enhance cli
Slide 91: Linkem
a hinkem Jefferies
Slide 92: Company Overview
Company Overview Fastest-growing fixed wireless broadband internet provider in Italy Quarterly Subscribers (Thousands) ─ Offers pre- and post-paid subscribers a 550 simple product at a compelling price point: 500 unlimited broadband services with speeds 450 up to 30 Mbps for €25/month 400 350 ─ 54
Slide 93: Industry Update
Industry Update The value of Linkem’s frequency has increased significantly ─ The 3.5GHz band is globally recognized as a core band for 5G services ─ We estimate that the results of Italy’s 3.6GHz frequency auction that concluded on October 2, 2018 imply a value of over $1.5 billion for Linkem’s f
Slide 94: Business Update
Business Update Linkem’s core consumer fixed wireless broadband business continued to grow with developments aimed at accelerating growth going forward ─ Linkem continues to be the fastest growing broadband provider in Italy ─ Deployed a new Category 12 indoor CPE with improved performance and ran
Slide 95: Strategic Priorities
Strategic Priorities Continue growing subscribers and the footprint of Linkem’s core consumer fixed wireless broadband service while maintaining excellent operating metrics and customer satisfaction Evaluate, test and opportunistically pursue developments with 5G to expand and improve service of
Slide 96: Q & A’s – IRQuestions@Jefferies.com
Q & A’s – IRQuestions@Jefferies.com
Slide 97: Appendix
Appendix Jefferies
Slide 98: Jefferies Financial Group – Pro Forma Equity GAAP Reconciliation
Jefferies Financial Group – Pro Forma Equity GAAP Reconciliation Reconciliation of Jefferies Financial Group Shareholders' Equity to Pro Forma Common Shareholders' Equity, Pro Forma Total Equity, Pro Forma Total Tangible Equity and Pro Forma Tangible Common Shareholders' Equity (Non-GAAP measures) (
Slide 99: Jefferies Financial Group - Fully-Diluted Shares Outstanding GAAP Reconciliation
Jefferies Financial Group - Fully-Diluted Shares Outstanding GAAP Reconciliation Reconciliation of Jefferies Financial Group GAAP Shares Outstanding to Fully-Diluted Shares Outstanding (a Non-GAAP measure) (thousands of shares) 6/30/2018 12/31/2017 Jefferies Financial Group Shares Outstanding (GAAP)
Slide 100: Reference Valuations – Page 7, Footnote 3
Reference Valuations – Page 7, Footnote 3 Market Capitalization – sourced from Bloomberg as of 9/28/18. Enterprise Value – represents the sum of market capitalization, debt (notes and loans payable, excluding securities sold under agreement to repurchase) and non- controlling interests, less cas
Slide 101: Jefferies Group – Tangible Assets and Tangible Member’s Equity GAAP Reconciliation
Jefferies Group – Tangible Assets and Tangible Jefferies Group LLC Member’s Equity GAAP Reconciliation 2015 2016 2017 2018 ($ Billions) 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q Total Assets (GAAP) 38.6 35.2 37.1 38.1 36.9 37.7 40.1 39.4 39.7 41.1 41.1 40.6 Less: Goodwill and Intangibles 1.9 1.9 1.9 1.9 1
Slide 102: Jefferies Group - Adjusted Tangible Member's Equity and Adjusted Net Earnings
Jefferies Group - Adjusted Tangible Jefferies Group LLC Member's Equity and Adjusted Net Earnings GAAP Reconciliations (for ROTE Calculations) ($ Thousands) At November 30, 2017 Total Jefferies Group LLC member’s equity $ 5,758,822 Deduct: Goodwill and intangible assets (1,842,882) Tangible Jefferie
Slide 103: Berkadia – Cash Earnings GAAP Reconciliation; National Beef – Adjusted EBITDA
Berkadia – Cash Earnings GAAP Reconciliation Reconciliation of Pre-Tax Income to Cash Earnings (a Non-GAAP measure) ($ Millions) 6 months 6 months ended ended 2012 2013 2014 2015 2016 2017 6/30/2017 6/30/2018 Pre-Tax Income (GAAP) $ 104 $ 153 $ 191 $ 164 $ 207 $ 194 $ 72 $ 114 Depreciation, amortiza
Slide 104: Idaho Timber – EBITDA GAAP Reconciliation
Idaho Timber – EBITDA GAAP Reconciliation Reconciliation of Pre-Tax Income to EBITDA (a Non-GAAP measure) ($ Millions) 6 months 6 months ended ended 2014 2015 2016 2017 6/30/2017 6/30/2018 Pre-Tax Income (GAAP) $ 17.8 $ 16.1 $ 20.3 $ 28.9 $ 13.4 $ 31.3 Depreciation & Amortization 6.4 3.9 2.8 3.4 1.7
Slide 105: Vitesse – Adjusted EBITDA GAAP Reconciliation
Vitesse – Adjusted EBITDA GAAP Reconciliation Reconciliation of Pre-Tax Income to Annualized Q2 2018 Adjusted EBITDA (a Non-GAAP measure) ($ Millions) Annualized 2Q 2018 (1) Pre-Tax Income (Loss) (GAAP) $ (3.3) Depletion, depreciation, amortization and accretion 42.9 Interest expense 4.3 Unrealized
Slide 106: Vitesse – Adjusted Pre-Tax Income GAAP Reconciliation
Vitesse – Adjusted Pre-Tax Income GAAP Reconciliation Reconciliation of Pre-Tax Income to Adjusted Pre-Tax Income (a Non-GAAP measure) ($ Millions) 4 Months Since April 2018 Acquisition (April-July) Pre-Tax Income (GAAP) $ 9 Unrealized losses on commodity derivative instruments 6 Other 2 Adjusted Pr
Slide 107: FXCM – Adjusted EBITDA and Adjusted Operating Expense Reconciliations
FXCM – Adjusted EBITDA and Adjusted Operating Expense Reconciliations Reconciliation of Net Income (Loss) from Continuing Operations to Adjusted EBITDA from Continuing Operations (a Non-GAAP measure) ($ Millions) 6 Months 6 Months Ended Ended 6/30/17 6/30/18 Net Income (Loss) from Continuing Operati
Slide 108: Linkem – Adjusted EBITDA GAAP Reconciliation
Linkem – Adjusted EBITDA GAAP Reconciliation Reconciliation of Pre-tax Loss to Adjusted EBITDA (a Non-GAAP measure) ( € Millions) LTM 6/30/18 Pre-tax Loss (GAAP) € (67) Interest expense 3 Depreciation & Amortization 68 Other (1) 12 Adjusted EBITDA (Non-GAAP) € 16 Note: Linkem is not consolidated by
Jefferies Financial Group — Investor Day (October 2018) on 6ix