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JEFFERIES ANNOUNCES THIRD QUARTER RESULTS

Net revenues of $334 million
Net earnings of $39 million
Earnings per share of $0.26
Investment banking of $190 million


New York, October 16, 2007 – Jefferies Group, Inc. (NYSE: JEF) today announced financial results for the third quarter ended September 30, 2007.

Highlights for the third quarter ended September 30, 2007:

  • Net revenues were down 2% to $334.4 million
    • , versus $340.6 million for the third quarter of 2006.
  • Net earnings were down 16% to $38.8 million
    • , compared to $45.9 million for the third quarter of 2006.
  • Earnings per share (diluted) were down 19% to $0.26
    • , compared to $0.32 for the third quarter of 2006.
  • Investment banking revenues were up 31% to $189.8 million
    • , compared to $144.8 million for the third quarter of 2006.

    “We are pleased that the challenging third quarter is behind us,” commented Richard B. Handler, Chairman and Chief Executive Officer of Jefferies. “The fact that our net revenues and net earnings for the quarter were each merely $7 million below last year's comparable period results is a testament to the hard work of our 2,513 employee partners, our diversified business model, our conservative balance sheet and the loyalty of our client base."

    Brian P. Friedman, Executive Committee Chairman, added, “Our investment banking revenues totaled $190 million, which represents our second best quarterly total ever. We are pleased with these results given the difficult market environment which made the normally slow summer months even more challenging.”


    Conference Call

    A conference call with management discussion of financial results for the third quarter ended September 30, 2007 will be held October 16th at 9:00 AM (Eastern) and can be accessed at 706-634-9290. A one-week replay of the call will also be available at 402-977-9140 (reservation code: 21352607). A live audio webcast and delayed replay can be accessed at www.jefferies.com. Questions for consideration by management can be submitted by 8:30 AM Eastern on October 16 through the “Contact Us” function at www.jefferies.com or by calling 203-708-5975.

    About Jefferies

    Jefferies, a global investment bank and institutional securities firm, has served growing and mid-sized companies and their investors for 45 years. Headquartered in New York, with more than 25 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.jefferies.com). Jefferies International Limited is a UK-incorporated, wholly owned subsidiary of Jefferies Group, Inc.

    Press Release in PDF format (financials included)

    Contact:
    Joseph A. Schenk, CFO
    (212) 284-2338