Jefferies went on a hiring spree in 2010, but it slowed down hiring in its first fiscal quarter of 2011 ended February 28. At the same time, the company set aside more for pay than it did in the first quarter last year.
Headcount at the firm was down two workers from the previous quarter to 3,082. That number is up 353 from 2,729 in the year earlier period, a reflection of the firm's hiring efforts in 2010.
The bank, which released its first quarter earnings today, is scaling back hiring in 2011 as it reaps the benefits of its 2010 expansion. On a conference call this morning, CEO Richard Handler said that "we feel like, at this point, we're making selected additions as opposed to the whole scale hires that we had historically."
Jefferies set aside almost $443 million in compensation and benefits for the first quarter 2011, compared to $319 million it put aside in the first quarter 2010. The compensation ratio, which compares compensation and benefits to net revenues, also increased to 58%, up from 55% in the year earlier period.
The firm reported net revenues of $758 million for the quarter, up 31% from $580 million a year earlier. Jefferies' results functions as a harbinger for other banks' results due to its unorthodox quarter system, so its investment banking revenues and global trading revenues, which were up 21% and 32%, respectively from last year, ought to be a good sign for the Street.
Last year's third quarter results, which saw slow trading volumes, were a sign of what was to come for other banks.
No gloom and doom this time, though: Jefferies beat analysts' estimates of 36 cents a share. The firm reported earnings of 42 cents a share.
Write to Julie Steinberg