Jefferies Reports Record 2017 Net Revenues and Net Income Led by 48% Increase in Investment Banking Net Revenues and 19% Increase in Total Equities and Fixed Income Net Revenues

Jefferies Group LLC today announced financial results for its fiscal fourth quarter and full year 2017.

Highlights for the twelve months ended November 30, 2017:

• Record Total Net Revenues of $3.20 billion
• Record Investment Banking Net Revenues of $1.76 billion
• Total Equities and Fixed Income Net Revenues of $1.42 billion
• Earnings Before Income Taxes of $505 million
• Record Net Earnings of $358 million

Highlights for the three months ended November 30, 2017:

• Total Net Revenues of $823 million
• Record Investment Banking Net Revenues of $529 million
• Total Equities and Fixed Income Net Revenues of $289 million
• Earnings Before Income Taxes of $142 million
• Net Earnings of $90 million

Rich Handler, Chairman and Chief Executive Officer, and Brian Friedman, Chairman of the Executive Committee, commented: “We are pleased that Jefferies' 2017 net revenues and net income represent the best results in our 55-year history. Our strategy of prioritizing expansion of our investment banking effort continues to succeed and should yield further growth over the next several years. The competitive landscape continues to provide opportunities for Jefferies to grow further by leveraging the unique blend of our non-bank Wall Street culture and business model, deep and broad sectoral expertise, and global geographic reach in investment banking, equity and fixed income trading, and research. We enter 2018 with strong momentum throughout our Company.”

“Our fourth quarter performance was driven by $529 million in Investment Banking net revenues. These quarterly record Investment Banking results reflect solid contributions from equity and debt capital markets, strong performance in our merger and acquisition advisory business, and broad participation across our industry groups and regional efforts. Our Equities net revenues of $194 million were solid, while our Fixed Income net revenues of $95 million are reflective of a period of lighter volumes, particularly in November, and narrower bid - offer spreads.”

“We would like to express our sincere thanks to our 3,450 employee-partners around the globe for their commitment, hard work, loyalty, integrity and dedication in serving our clients and Leucadia's shareholders.”

The attached financial tables should be read in conjunction with our Quarterly Report on Form 10-Q for the quarter ended August 31, 2017, our Annual Report on Form 10-K for the year ended November 30, 2016 and our amended Annual Report on Form 10-K/A for the year ended November 30, 2016. Amounts herein pertaining to November 30, 2017 represent a preliminary estimate as of the date of this earnings release and may be revised in our Annual Report on Form 10-K for the year ended November 30, 2017.

This release contains "forward-looking statements" within the meaning of the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements include statements about our future results and performance, including our future market share and expected financial results. It is possible that the actual results may differ materially from the anticipated results indicated in these forward-looking statements. Please refer to our most recent Annual Report on Form 10-K for a discussion of important factors that could cause actual results to differ materially from those projected in these forward-looking statements.

Jefferies, the world's only independent full-service global investment banking firm focused on serving clients for over 50 years, is a leader in providing insight, expertise and execution to investors, companies and governments. Our firm provides a full range of investment banking, sales, trading, research and strategy across the spectrum of equities, fixed income and foreign exchange, as well as wealth management, in the Americas, Europe and Asia. Jefferies Group LLC is a wholly-owned subsidiary of Leucadia National Corporation (NYSE: LUK), a diversified holding company.

JEFFERIES GROUP LLC AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(Amounts in Thousands)
(Unaudited)
		Quarter Ended
		November 30, 2017			August 31, 2017			November 30, 2016
Revenues:
Commissions and other fees		$	155,710		$	139,082		$	157,549
Principal transactions		107,418			185,215			137,362
Investment banking		528,699			475,702			415,067
Asset management fees and investment income from managed funds		4,769			5,465			1,319
Interest		245,278			230,496			202,002
Other		39,625			12,371			26,661
Total revenues		1,081,499			1,048,331			939,960
Interest expense		258,889			247,639			198,191
Net revenues		822,610			800,692			741,769
Non-interest expenses:
Compensation and benefits		455,469			462,933			427,451
Non-compensation expenses:
Floor brokerage and clearing fees		41,257			44,869			42,946
Technology and communications		73,817			72,440			66,396
Occupancy and equipment rental		25,759			27,736			26,635
Business development		27,661			23,125			25,405
Professional services		31,167			25,007			29,763
Other		25,200			22,318			26,644
Total non-compensation expenses		224,861			215,495			217,789
Total non-interest expenses		680,330			678,428			645,240
Earnings before income taxes		142,280			122,264			96,529
Income tax expense		52,331			38,439			9,454
Net earnings		89,949			83,825			87,075
Net earnings (loss) attributable to noncontrolling interests		36			10			(105)
Net earnings attributable to Jefferies Group LLC		$	89,913		$	83,815		$	87,180
Pretax operating margin		17.3%			15.3%			13.0%
Effective tax rate (1)		36.8%			31.4%			9.8%

(1)		The effective tax rate for the three months ended November 30, 2016 was impacted by revisions to previously forecasted results.

JEFFERIES GROUP LLC AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(Amounts in Thousands)
(Unaudited)
		Twelve Months Ended
		November 30, 2017			November 30, 2016
Revenues:
Commissions and other fees		$	593,257		$	611,574
Principal transactions		800,660			519,652
Investment banking		1,764,285			1,193,973
Asset management fees and investment income from managed funds		16,463			31,062
Interest		905,601			857,838
Other		98,316			19,724
Total revenues		4,178,582			3,233,823
Interest expense		980,473			819,209
Net revenues		3,198,109			2,414,614
Non-interest expenses:
Compensation and benefits		1,829,096			1,568,948
Non-compensation expenses:
Floor brokerage and clearing fees		179,478			167,205
Technology and communications		279,242			262,396
Occupancy and equipment rental		102,904			101,133
Business development		99,884			93,105
Professional services		114,711			112,562
Other		87,870			79,293
Total non-compensation expenses		864,089			815,694
Total non-interest expenses		2,693,185			2,384,642
Earnings before income taxes		504,924			29,972
Income tax expense		147,340			14,566
Net earnings		357,584			15,406
Net earnings (loss) attributable to noncontrolling interests		86			(28)
Net earnings attributable to Jefferies Group LLC		$	357,498		$	15,434
Pretax operating margin		15.8%			1.2%
Effective tax rate		29.2%			48.6%

JEFFERIES GROUP LLC AND SUBSIDIARIES
SELECTED STATISTICAL INFORMATION
(Amounts in Thousands, Except Other Data)
(Unaudited)
		Quarter Ended
		November 30, 2017			August 31, 2017			November 30, 2016
Revenues by Source
Equities		$	194,426		$	176,789		$	175,960
Fixed income		94,716			142,736			149,423
Total Equities and Fixed income		289,142			319,525			325,383
Equity		122,424			86,081			62,085
Debt		174,484			186,261			128,706
Capital markets		296,908			272,342			190,791
Advisory		231,791			203,360			224,276
Total Investment banking		528,699			475,702			415,067
Asset management fees and investment income from managed funds:
Asset management fees		4,122			4,272			633
Investment income from managed funds		647			1,193			686
Total		4,769			5,465			1,319
Net revenues		$	822,610		$	800,692		$	741,769
Other Data
Number of trading days		63			65			63
Number of trading loss days		5			3			11
Average firmwide VaR (in millions) (1)		$	5.29		$	6.51		$	8.46

(1)		VaR estimates the potential loss in value of our trading positions due to adverse market movements over a one-day time horizon with a 95% confidence level. For a further discussion of the calculation of VaR, see "Value-at-Risk" in Part II, Item 7 "Management's Discussion and Analysis" in our Annual Report on Form 10-K for the year ended November 30, 2016.

JEFFERIES GROUP LLC AND SUBSIDIARIES
SELECTED STATISTICAL INFORMATION
(Amounts in Thousands, Except Other Data)
(Unaudited)
		Twelve Months Ended
		November 30, 2017			November 30, 2016
Revenues by Source
Equities		$	799,451		$	549,553
Fixed income		617,910			640,026
Total Equities and Fixed income		1,417,361			1,189,579
Equity		344,973			235,207
Debt		649,220			304,576
Capital markets		994,193			539,783
Advisory		770,092			654,190
Total Investment banking		1,764,285			1,193,973
Asset management fees and investment income (loss) from managed funds:
Asset management fees		20,490			26,412
Investment income (loss) from managed funds		(4,027)			4,650
Total		16,463			31,062
Net revenues		$	3,198,109		$	2,414,614
Other Data
Number of trading days		252			253
Number of trading loss days		14			38
Average firmwide VaR (in millions) (1)		$	7.79		$	7.91

(1)		VaR estimates the potential loss in value of our trading positions due to adverse market movements over a one-day time horizon with a 95% confidence level. For a further discussion of the calculation of VaR, see "Value-at-Risk" in Part II, Item 7 "Management's Discussion and Analysis" in our Annual Report on Form 10-K for the year ended November 30, 2016.

JEFFERIES GROUP LLC AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS
(Amounts in Millions, Except Where Noted)
(Unaudited)
		Quarter Ended
		November 30, 2017				August 31, 2017				November 30, 2016
Financial position:
Total assets (1)		$	39,706			$	39,358			$	36,941
Average total assets for the period (1)		$	47,058			$	45,311			$	43,412
Average total assets less goodwill and intangible assets for the period (1)		$	45,215			$	43,467			$	41,560
Cash and cash equivalents (1)		$	5,164			$	4,807			$	3,529
Cash and cash equivalents and other sources of liquidity (1) (2)		$	6,709			$	6,191			$	5,303
Cash and cash equivalents and other sources of liquidity - % total assets (1) (2)		16.9%				15.7%				14.4%
Cash and cash equivalents and other sources of liquidity - % total assets less goodwill and intangible assets (1) (2)		17.7%				16.5%				15.1%
Financial instruments owned (1)		$	13,998			$	14,037			$	13,810
Goodwill and intangible assets (1)		$	1,843			$	1,841			$	1,847
Total equity (including noncontrolling interests) (1)		$	5,760			$	5,655			$	5,371
Total Jefferies Group LLC member's equity (1)		$	5,759			$	5,654			$	5,370
Tangible Jefferies Group LLC member's equity (1) (3)		$	3,916			$	3,813			$	3,523
Level 3 financial instruments:
Level 3 financial instruments owned (1) (4)		$	328			$	348			$	413
Level 3 financial instruments owned - % total assets		0.8%				0.9%				1.1%
Level 3 financial instruments owned - % total financial instruments (1)		2.3%				2.5%				3.0%
Level 3 financial instruments owned - % tangible Jefferies Group LLC member's equity		8.4%				9.1%				11.7%
Other data and financial ratios:
Total long-term capital (1) (5)		$	11,162			$	11,038			$	10,501
Leverage ratio (1) (6)		6.9				7.0				6.9
Tangible gross leverage ratio (1) (7)		9.7				9.8				10.0
Number of trading days		63				65				63
Number of trading loss days		5				3				11
Average firmwide VaR (8)		$	5.29			$	6.51			$	8.46
Number of employees, at period end		3,450				3,438				3,329

JEFFERIES GROUP LLC AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS - FOOTNOTES
(1)		Amounts pertaining to November 30, 2017 represent a preliminary estimate as of the date of this earnings release and may be revised in our Annual Report on Form 10-K for the year ended November 30, 2017.
(2)		At November 30, 2017, other sources of liquidity include high quality sovereign government securities and reverse repurchase agreements collateralized by U.S. government securities and other high quality sovereign government securities of $1,031 million, in aggregate, and $514 million, being the estimated amount of additional secured financing that could be reasonably expected to be obtained from our financial instruments that are currently not pledged after considering reasonable financing haircuts. The corresponding amounts included in other sources of liquidity at August 31, 2017 were $1,083 million and $301 million, respectively, and at November 30, 2016, were $1,455 million and $319 million, respectively.
(3)		Tangible Jefferies Group LLC member's equity (a non-GAAP financial measure) represents total Jefferies Group LLC member's equity less goodwill and identifiable intangible assets. We believe that tangible Jefferies Group LLC member's equity is meaningful for valuation purposes, as financial companies are often measured as a multiple of tangible equity, making these ratios meaningful for investors.
(4)		Level 3 financial instruments represent those financial instruments classified as such under Accounting Standards Codification 820, accounted for at fair value and included within Financial instruments owned.
(5)		At November 30, 2017, August 31, 2017 and November 30, 2016, total long-term capital includes our long-term debt of $5,403 million, $5,383 million and $5,131 million, respectively, and total equity. Long-term debt included in total long-term capital is reduced by the amount of debt maturing in less than one year, as applicable.
(6)		Leverage ratio equals total assets divided by total equity.
(7)		Tangible gross leverage ratio (a non-GAAP financial measure) equals total assets less goodwill and identifiable intangible assets divided by tangible Jefferies Group LLC member's equity. The tangible gross leverage ratio is used by rating agencies in assessing our leverage ratio.
(8)		VaR estimates the potential loss in value of our trading positions due to adverse market movements over a one-day time horizon with a 95% confidence level. For a further discussion of the calculation of VaR, see "Value-at-Risk" in Part II, Item 7 "Management's Discussion and Analysis" in our Annual Report on Form 10-K for the year ended November 30, 2016.

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