FOR IMMEDIATE RELEASE

Jefferies Group Announces Record Third Quarter Results; Revenues, Net Earnings and Earnings Per Share up 32%, 57% and 46%, Respectively

NEW YORK--(BUSINESS WIRE)--Oct. 19, 2004--Jefferies Group, Inc. (NYSE:JEF) today announced record third quarter financial results for the quarter ended September 30, 2004.

Highlights for the record third quarter ended September 30, 2004:

• Total revenues were up 32% to $293.1 million versus $221.9 million for the third quarter of 2003.
• Net earnings were up 57% to a record of $32.3 million compared to $20.5 million for the third quarter of 2003.
• Earnings per share (diluted) were up 46% to tie the record of $0.51 compared to $0.35 for the third quarter of 2003.
• Total trading revenues were up 21% to a record of $171.0 million versus $141.3 million for the third quarter of 2003.
• Investment banking revenues were up 72% to $72.1 million versus $42.0 million for the third quarter of 2003.
• Asset management related revenues were up 20% to $11.6 million versus $9.7 million for the third quarter of 2003.

Highlights for the record first nine months ended September 30, 2004:

• Total revenues were up 37% to a record $873.4 million versus $637.5 million for the first nine months of 2003.
• Net earnings were up 79% to a record $96.0 million compared to $53.5 million for the first nine months of 2003.
• Earnings per share (diluted) were up 64% to a record $1.51 compared to $0.92 for the first nine months of 2003.
• Total trading revenues were up 19% to a record $477.8 million versus $402.0 million for the first nine months of 2003.
• Investment banking revenues were up 89% to a record $247.1 million versus $130.9 million for the first nine months of 2003.
• Asset management related revenues were up 167% to a record $54.3 million versus $20.3 million for the first nine months of 2003.

"The third quarter has generally been our seasonally slowest period, so we are pleased that each of our businesses performed solidly despite the summer slowdown," said Richard B. Handler, Chairman and Chief Executive Officer of Jefferies. "The environment has been and most likely will continue to be challenging. We will continue to diversify our platform and expand our trading, research, asset management, and investment banking businesses that focus on middle market and growth companies."

"Our 1,750 employee-partners have worked tenaciously to serve our loyal client base. We owe both of these constituencies great thanks in helping us to build our firm," added John C. Shaw, Jr., President of Jefferies. "We will continue to focus on cost containment, variable compensation, high employee ownership, and the strong desire to best serve our clients."

Conference Call

A conference call with management discussion of financial results for the third quarter ended September 30, 2004 will be held October 19 at 11:00 AM (Eastern) and can be accessed at 617-801-9714 (code: 97306224). A replay of the call will be available two hours post-call at 617-801-6888 (code: 88546460). A live audio webcast and delayed replay will also be available under "Investor Relations" at www.jefco.com. Questions for consideration by management can be submitted in advance through the "Contact Us" function at www.jefco.com or by calling 203-708-5975 by 9:30 AM Eastern on October 19.

About Jefferies

Jefferies, a global investment bank and institutional securities firm, has served middle-market and growth companies and their investors for over 40 years. Headquartered in New York, with more than 20 offices around the world, Jefferies provides clients with capital markets and financial advisory services, institutional brokerage, securities research and asset management. The firm is a leading provider of trade execution in equity, high yield, convertible and international securities for institutional investors and high net worth individuals. Jefferies & Company, Inc. is the principal operating subsidiary of Jefferies Group, Inc. (NYSE: JEF; www.jefco.com).

Forward-Looking Statements

This press release contains statements that may constitute "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. These forward-looking statements include statements about our future and may contain expectations regarding revenues, earnings, operations and other financial projections, and may include statements of our operating environment, future performance, positioning, plans and objectives. These forward-looking statements represent only our belief regarding future events, many of which, by their nature, are inherently uncertain and outside of our control. Actual results could differ materially from those projected in these forward-looking statements. Please refer to our recent Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on August 2, 2004 and other filings we make with the Securities and Exchange Commission for a discussion of important factors that could cause actual results to differ materially from those projected in these forward-looking statements. We do not assume any obligation to update any forward-looking statement we make.

Press Release in PDF format (financials included)

CONTACT:
Jefferies Group, Inc.
Joseph A. Schenk, 212-284-2338

SOURCE: Jefferies Group, Inc.