 Net Income of 3.3 Million or 0.69 per Diluted Share Adjusted Net Income of 4.0 Million or 0.80 per Diluted SharePHILADELPHIA and NEW YORK, Aug. 07, 2020 GLOBE NEWSWIRE -- Cohen Company Inc. NYSE American: COHN, a financial services firm specializing in fixed income markets, today reported financial results for its second quarter ended June 30, 2020.Summary Operating Results Three Months Ended in thousands63020 33120 63019 Total revenues24,119 17,770 11,169 Compensation and benefits11,324 14,134 6,432 Non-compensation operating expenses, excluding goodwill impairment4,869 5,198 4,219 Goodwill impairment- 7,883 - Operating income7,926 9,445 518 Interest expense, net3,081 2,605 1,939 Income loss from equity method affiliates1,233 107 248 Income loss before income tax expense benefit3,612 12,157 1,669 Income tax expense benefit343 372 641 Net income loss3,269 11,785 1,028 Less: Net income loss attributable to the noncontrolling interest2,368 8,683 618 Net income loss attributable to Cohen Company Inc. 901 3,102 410 Fully diluted net income loss per share0.69 2.70 0.36 Adjusted net income loss4,009 3,742 900 Fully diluted adjusted net income loss per share0.80 0.95 0.54 Net income was 3.3 million, or 0.69 per diluted share, for the three months ended June 30, 2020, compared to net loss of 11.8 million, or 2.70 per diluted share, for the three months ended March 31, 2020, and net loss of 1.0 million, or 0.36 per diluted share, for the three months ended June 30, 2019. Adjusted net income was 4.0 million, or 0.80 per diluted share, for the three months ended June 30, 2020, compared to adjusted net loss of 3.7 million, or 0.95 per diluted share, for the three months ended March 31, 2020, and adjusted net loss of 0.9 million, or 0.54 per diluted share, for the three months ended June 30, 2019. Adjusted net income loss is not a measure recognized under U.S. generally accepted accounting principles GAAP. See Note 1 on page 4. Revenues during the three months ended June 30, 2020 increased 6.3 million from the prior quarter and 13.0 million from the prior year quarter. The increase from the prior quarter was comprised primarily of i an increase of 1.4 million in net trading revenue primarily from increased revenue in the Companys Gestation repo and Muni trading groups and ii an increase of 4.9 million in principal transactions revenue related to mark-to-market gains on the Companys principal investment portfolio. The increase from the prior year quarter was comprised primarily of i an increase of 11.3 million in net trading revenue primarily from increased revenue in the Companys GCF repo and Gestation repo businesses, as well as increased revenue from the Companys corporate group, and ii an increase of 1.7 million in principal transactions related to mark-to-market gains on the Companys principal investment portfolio. Compensation and benefits expense as a percentage of revenue was 47 for the three months ended June 30, 2020, compared to 80 for the three months ended March 31, 2020 and 58 for the three months ended June 30, 2019. During the quarter ended March 31, 2020, the Companys variable compensation structure had an outsized unfavorable impact on results due to the significant negative revenue recorded from realized and unrealized losses in certain trading books and from principal transactions with no meaningful corresponding reduction in variable compensation to offset the negative revenue. The number of Company employees was 94 as of June 30, 2020, compared to 95 as of March 31, 2020, and 90 as of June 30, 2019. Non-compensation operating expenses excluding goodwill impairment during the three months ended June 30, 2020 decreased 0.3 million from the prior quarter and increased 0.7 million from the prior year quarter. The decrease from the prior quarter was primarily due to lower professional fees and business development expenses. The increase from the prior year quarter was primarily due to increased net trading revenue-driven clearing and execution costs and professional fees in the current quarter. A non-cash goodwill impairment charge of 7.9 million was recognized during the three months ended March 31, 2020, after the Company performed an impairment test of goodwill attributable to its wholly owned subsidiary, J.V.B. Financial Group, LLC. The Company has no goodwill attributable to J.V.B. Financial Group, LLC after this impairment. Interest expense during the three months ended June 30, 2020 increased 0.5 million from the prior quarter and 1.1 million from the prior year quarter. The changes in quarterly interest expense are primarily driven by fluctuations in interest on redeemable financial instruments, which are driven by certain Company groups revenues and profits. Loss from equity method affiliates during the three months ended June 30, 2020 increased 1.1 million from the prior quarter and 1.0 million from the prior year quarter. The increase in loss from equity method affiliates was primarily related to expenses incurred by the Company-sponsored Insurance Acquisition Corp. Nasdaq: INSU the Insurance SPAC, a blank check company seeking to effect a merger, capital stock exchange, asset acquisition, stock purchase, reorganization, or similar business combination with one or more businesses. As of June 30, 2020, total equity was 40.4 million, compared to 48.8 million as of December 31, 2019.Lester Brafman, Chief Executive Officer of Cohen Company, said, We are pleased with our second quarter results, and extremely excited about the development of some of our longer term strategic initiatives across our SPAC franchise, as well as our broker dealer and asset management businesses. We are active in multiple aspects of the SPAC market, including as a sponsor, asset manager and investor. Our company-sponsored Insurance SPAC, Insurance Acquisition Corp, entered into a merger agreement with Shift Technologies, Inc., and we are now also the sponsor of a second special purpose acquisition company, which intends to raise 175 million in an initial public offering of its units.Brafman continued, Our Vellar Funds, which focus on investing in SPAC opportunities, raised additional capital during the quarter. Cohens involvement in the SPAC market both as a sponsor and as an asset manager has given the firm access to unique investment opportunities, one of which drove the revenue in our principal investing segment this period. We have a long history in the SPAC space, and we intend to continue building our SPAC franchise and capitalizing on opportunities in the space.On the broker dealer side, we continue to grow our mortgage complex, specifically our gestation repo business, where our balances increased to 2.3 billion by the end of the quarter. Our European investment advisory subsidiary successfully launched another series of closed-end investment vehicles with total commitments in excess of 375 million.Brafman concluded, I am proud of our companys ability to drive our initiatives forward while navigating this uniquely challenging environment. We are optimistic that the strategic investments we have made in these businesses will continue to pay off, and we remain committed to executing on our objectives, with a continued focus on enhancing stockholder value.Insurance Acquisition Corp. Enters into Merger AgreementOn June 29, 2020, Cohen Company-sponsored Insurance Acquisition Corporation Nasdaq: INSU Insurance SPAC entered into an Agreement and Plan of Merger with IAC Merger Sub, Inc., a Delaware corporation and direct wholly owned subsidiary of Insurance SPAC Merger Sub, and Shift Technologies, Inc., a Delaware corporation Shift. The Agreement and Plan of Merger provides for, among other things, the acquisition of Shift by Insurance SPAC pursuant to the proposed merger of Merger Sub with and into Shift with Shift continuing as the surviving entity and a direct wholly owned subsidiary of Insurance SPAC the Merger. Upon a closing of the Merger, the Company expects that its consolidated subsidiaries, Insurance Acquisition Sponsor, LLC and Dioptra Advisors, LLC collectively, the Sponsor Entities, of which the Company is the manager and a member, would collectively retain an aggregate of 375,000 placement shares as well as between 4,000,000 and 4,500,000 founder shares collectively, the Sponsor Shares of Insurance SPAC. In the event that the Merger is consummated, the Company currently expects that 253,000 of the placement shares and between 2,200,000 and 2,500,000 of the founder shares would be distributed to the non-controlling interests of the Sponsor Entities, with the Company retaining the balance of the placement shares and the founder shares. Additional details regarding the merger transaction are available in the Companys filings with the Securities and Exchange Commission SEC. SPAC Sponsorship In addition to the Insurance SPAC, Cohen Company is the sponsor of a second special purpose acquisition company SPAC II. SPAC II will seek to effect a merger, capital stock exchange, asset acquisition, stock purchase, reorganization, or similar business combination with one or more businesses that provides insurance or insurance related services but will not be required to complete a business combination with an insurance business. In July 2020, SPAC II filed a registration statement with the SEC with the intent to raise 175 million. 