GAMCO Investors, Inc. Reports Record Fourth Quarter and Full Year Results

  GAMCO Investors, Inc. Reports Record Fourth Quarter and Full Year Results

            *Assets under Management Rise to a Record $47.0 Billion
         *Fourth Quarter Earnings Per Share Up 93% to $1.29 per share
  *Full Year Earnings Per Share Up 59% to $4.54 per share

Business Wire

RYE, N.Y. -- February 4, 2014

GAMCO Investors, Inc. (“GAMCO”) (NYSE:GBL) today reported its 2013 fourth
quarter results including revenues of $122.7 million, net income of $33.3
million and earnings per diluted share of $1.29. On a comparable basis,
revenues were $99.3 million, net income was $17.6 million, and earnings per
diluted share were $0.67 in the fourth quarter of 2012. For the full year 2013
revenues increased 15.5% to $397.6 million versus $344.3 million, net income
surged to $116.9 million, or $4.54 per diluted share, an increase of 54.7%
from earnings of $75.5 million or $2.86 for the full year 2012.

Assets under Management (“AUM”) rose to a record $47.0 billion, up 8.1% from
$43.5 billion at September 30, 2013 and up 29.1% from $36.4 billion at
December 31, 2012.

                                                                            
Financial            Fourth Quarter                 Full Year                       
Highlights
($'s in 000's
except AUM and          2012        2013               2012              2013
per share data)
                                                                                           
AUM - end of
period (in              $ 36,405     $ 47,010            $ 36,405            $ 47,010
millions)
AUM - average (in         36,278       45,523              36,048              41,749
millions)
                                                                                           
Revenues                  99,277       122,714             344,281             397,562
                                                                                           
Operating income
before management         27,902       51,547              124,148             161,241
fee (a)
Operating margin
before management         28.1   %     42.0    %           36.1    %           40.6    %
fee
                                                                                           
Other
income/(expense),         3,740        6,148               6,186               41,139
net
                                                                                           
Income before             28,479       53,321              117,316             183,551
income taxes
Effective tax             38.0   %     37.0    %           35.6    %           36.1    %
rate
                                                                                           
Net income                17,594       33,317              75,539              116,853
Net income per          $ 0.67       $ 1.29        (b)   $ 2.86        (c)   $ 4.54        (b)
share
                                                                                           
Shares
outstanding at        25,746    26,086         25,746         26,086    
December 31

(a)  See GAAP to non-GAAP reconciliation on page 12.
      After a $0.12 per fully diluted share charge and $0.24 per fully diluted
(b)   share charge for the fourth quarter and full year 2013, respectively,
      for our shareholder-designated charitable contribution program.
      After a $0.08 per fully diluted share charge for the full year ended
(c)   December 31, 2012 related to the extinguishment of debt from the Dutch
      Auction of the 0% Subordinated Debentures.

Assets Under Management

Total firm AUM increased to a record $47.0 billion at December 31, 2013, up
$3.5 billion from the third quarter and $10.6 billion higher than the fourth
quarter of 2012. Our fourth quarter 2013 net inflows were $271 million,
reduced by $189 million of net open- and closed-end fund distributions. Market
appreciation totaled $3.4 billion.

AUM in our open-end funds increased $1.5 billion during the quarter to $18.8
billion at December 31, 2013. Net inflows into our open-end funds totaled $351
million, reflecting an annualized organic growth rate of 8.1%, reduced by net
distributions of $51 million. Market appreciation added $1.2 billion. AUM in
our open-end equity funds totaled $17.1 billion, 9.6% ahead of the previous
quarter end AUM and 36.6% higher than the year earlier period.

Our closed-end funds had AUM of $6.9 billion on December 31, 2013, 10.4%
higher than the $6.3 billion on December 31, 2012 and 3.3% above the $6.7
billion on September 30, 2013. For 2013, market appreciation was $991 million
and was partially offset by distributions from all closed-end funds, net of
reinvestments, which reduced AUM by $484 million.

Institutional and private wealth management AUM increased 9.1% from the
September 2013 quarter end to $20.3 billion and was 35.3% higher than the
comparable 2012 year end.

Our investment partnerships’ AUM increased to $811 million on December 31,
2013 from $805 million on September 30, 2013.

Firm wide, net inflows during the full year of 2013 were $1.6 billion, market
appreciation totaled $9.6 billion and net open- and closed-end fund
distributions were $625 million. This compares with net outflows of $1.0
billion, market appreciation of $4.0 billion and net open- and closed-end fund
distributions of $596 million for the full year of 2012.

Revenues

  *Revenues for the fourth quarter of 2013 were $122.7 million, up 23.6% from
    $99.3 million in the prior year.
  *Investment advisory and incentive fees were $106.2 million in the fourth
    quarter of 2013, an increase of $20.5 million or 23.9% from the comparable
    2012 quarter. Revenues were generally driven by growth in average AUM in
    our open- and closed-end funds and higher billable assets in our
    institutional and private wealth management accounts as well as a $3.5
    million increase in incentive fees.

  *Average AUM in the open-end equity funds were $16.3 billion, an increase
    of 30.4% from $12.5 billion in the comparable 2012 quarter.

  *Average AUM in the institutional and private wealth management accounts
    were $19.6 billion, 33.1% higher than the prior year quarter.

  *Incentive fees earned during the 2013 quarter totaled $21.3 million versus
    $17.8 million in the fourth quarter of 2012.
  *Revenues from the distribution of our open-end funds and other income were
    $14.5 million for the fourth quarter 2013, an increase of $3.4 million, or
    31.3%, from the prior year quarter of $11.1 million.
  *Our institutional research services revenues were $2.0 million in the
    fourth quarter 2013 versus $2.5 million in the prior year period.

Operating Income – Fourth Quarter

Operating income before management fee was $51.5 million in the fourth quarter
2013 versus $27.9 million in the fourth quarter 2012. Included in the 2012
quarter was a $10.1 million non-cash charge resulting from the acceleration of
RSAs. Operating margin before management fee improved to 42.0% versus 28.1%
(or 38.3% excluding the non-cash charge) in the fourth quarter of 2012.
Management believes evaluating operating income before management fee is an
important measure in analyzing the Company’s operating results. Further
information regarding Non-GAAP measures is included in Notes on Non-GAAP
Financial Measures and Table VII included elsewhere herein.

Operating income, which is net of management fee expense, was $47.2 million in
the fourth quarter of 2013 versus $24.7 million in the prior year period, an
increase of $22.5 million. The operating margin was 38.4% in the fourth
quarter of 2013 versus 24.9% in the comparable prior year period. The
improvement in operating margin was due to leveraging of fixed costs partially
offset by higher management fee expense. Excluding the non-cash charge, net of
management fee, operating income and operating margin in the fourth quarter of
2012 were $33.8 million and 34.1%, respectively. Management fee expense, which
is incentive based and entirely variable, is based on pre-tax income and was
impacted by the significant increase in quarter over quarter investment
income.

Other income (expense)

Other income/(expense), net, was $6.2 million, or $0.12 per diluted share, in
the 2013 quarter versus $3.7 million, or $0.07 per diluted share, in the
fourth quarter of 2012. Gains from investments in mutual funds, alternative
products and proprietary accounts were $11.4 million in the 2013 quarter
versus gains of $5.5 million in the fourth quarter of 2012. Dividend and
interest income totaled $2.1 million, up from $1.7 million in the prior year
period. Interest expense was $2.1 million in the 2013 fourth quarter; $1.4
million lower than the prior year quarter due to the fourth quarter 2012
repurchase of $64.1 million (face value) of 0% subordinated debentures through
a tender offer as well as the payment of the $99 million 5.5% senior notes
which came due May 15, 2013. In addition, the fourth quarter 2013 had a charge
of $5.3 million, or $0.12 per diluted share, for our 2014 Shareholder
Designated Charitable Contribution program.

Income Taxes

The effective tax rate for the quarter ended December 31, 2013 was 37.0%
compared to the 2012 quarter effective tax rate of 38.0%.

Business and Investment Highlights

  *GAMCO was ranked #232 in Pensions & Investments annual release of the
    largest 500 money managers, which includes both equity and fixed income
    managers, world-wide on December 31, 2012.
  *GAMCO Investors, Inc. held a Special Meeting of Shareholders on November
    20, 2013 where the shareholders approved a change in the Company’s state
    of incorporation from New York to Delaware and approved an amendment to
    the Company’s 2002 Stock Award & Incentive Plan to increase by two million
    the number of Class A shares reserved for issuance.
  *On November 7, 2013, GAMCO announced that its Board of Directors approved
    a $0.25 per share donation under its Shareholder Designated Charitable
    Contribution Program on behalf of all registered Class A and Class B
    shareholders as of March 31, 2014. GAMCO created its Shareholder
    Designated Contribution Program in April 2013.
  *On November 4-5 2013, G.research (formerly Gabelli & Company) hosted its
    37^th Annual Automotive Aftermarket Symposium in Las Vegas, Nevada. This
    two day conference showcased a full spectrum of leading automotive
    companies, including aftermarket parts retailers, original equipment and
    aftermarket parts suppliers, publicly traded dealership groups and medium
    & heavy duty truck manufacturers. The conference featured more than twenty
    companies introduced by a team of G.research analysts led by Brian
    Sponheimer.
  *G.research hosted its 19^th Annual Aircraft Supplier conference on
    November 19, 2013 in New York City. This research focused meeting featured
    presentations from leading aerospace and defense industry managements with
    an emphasis on sequestration dynamics, new technologies and company
    fundamentals.

Balance Sheet – $578.7 million of Cash and Investments at Quarter End

We ended the quarter with cash and investments of $578.7 million, debt of
$111.9 million ($113.8 million face value) and equity attributable to GAMCO
shareholders of $457.3 million. We have $400 million available on our
universal shelf registration which allows us the flexibility to issue any
combination of senior and subordinated debt securities, convertible debt
securities and common and preferred equity. Together with earnings from
operations, the shelf provides us with flexibility to do acquisitions,
lift-outs, seed new investment strategies, and co-invest as well as fund
shareholder compensation including share repurchase, and dividends.

Shareholder Compensation

During the year ended December 31, 2013, we returned $33.5 million of our
earnings to shareholders through dividends and stock repurchases. We
repurchased 229,228 shares at an average price of $64.41 per share through our
stock buyback program, for a total investment of $14.8 million. We returned
$18.7 million through cash dividends.

On February 4, 2014, GAMCO’s Board of Directors declared a regular quarterly
dividend of $0.06 per share payable on March 25, 2014 to its Class A and Class
B shareholders of record on March 11, 2014.

NOTES ON NON-GAAP FINANCIAL MEASURES

   
     Operating income before management fee expense is used by management to
     evaluate its business operations. We believe this measure is useful in
     illustrating the operating results of GAMCO Investors, Inc. (the
     “Company”) as management fee expense is based on pre-tax income before
A.   management fee expense, which includes non-operating items including
     investment gains and losses from the Company’s proprietary investment
     portfolio and interest expense. The reconciliation of operating income
     before management fee expense to operating income is provided in Table
     VII.
     
     Operating income before management fee expense per share and other
     income, net per share are used by management for purposes of evaluating
     its business operations. We believe these measures are useful in
     comparing the operating and non-operating results of the Company for the
     purposes of understanding the composition of net income per fully diluted
B.   share. The positive swing of $0.05 per fully diluted share is derived by
     making certain necessary adjustments, as shown in the table below, to
     arrive at a net impact for each period and then calculating the
     difference. The reconciliation of operating income before management fee
     expense per share and other income, net per share to net income per fully
     diluted share, is provided below.

                                                            
                            4th Quarter                Full Year
                            2012         2013          2012          2013
    Operating income
    before management       $ 27,902     $ 51,547      $ 124,148     $ 161,241
    fee
    Management fee            (2,802 )     (3,774  )     (12,427 )     (14,743 )
    expense
    Tax expense               (9,529 )     (17,697 )     (39,732 )     (52,825 )
    Noncontrolling           120        99          363         (745    )
    interest expense
    Operating income
    (after management        15,691     30,175      72,352      92,928  
    fee and taxes)
    Per fully diluted       $ 0.60      $ 1.17       $ 2.74       $ 3.61    
    share
                                                                     
    Other
    income/(expense),       $ 3,740      $ 6,148       $ 6,186       $ 41,139
    net
    Management fee            (361   )     (600    )     (591    )     (4,086  )
    (expense)/benefit
    Tax                       (1,283 )     (2,055  )     (1,989  )     (13,361 )
    (expense)/benefit
    Noncontrolling
    interest                 (193   )    (351    )    (419    )    233     
    (expense)/benefit
    Other
    income/(expense),
    net (after              $ 1,903     $ 3,142      $ 3,187      $ 23,925  
    management fee
    and taxes)
    Per fully diluted       $ 0.07      $ 0.12       $ 0.12       $ 0.93    
    share
                                                                     
    Net income per
    fully diluted           $ 0.67      $ 1.29       $ 2.86       $ 4.54    
    share
    Diluted weighted
    average shares           26,305     25,733      26,436      25,712  
    outstanding
                                                                     

C.  Shareholder-designated charitable contribution program expense, net of
     management fee and tax benefit, per diluted share, is provided below:

                                                               
                                                        4th Quarter   YTD
    (in thousands, except per share data)               2013          2013
    Shareholder-designated charitable                   $   5,313     $ 10,626
    contribution program
    Management fee and tax benefit                         2,291      4,582
    Net expense                                         $   3,022     $ 6,044
                                                                      
    Shareholder-designated charitable                   $   0.12      $ 0.24
    contribution program charge per share
    Diluted weighted average shares outstanding            25,733     25,712
                                                                      

D.  Non- cash charge for RSA acceleration expense:

                                                       
                                                4th Quarter   Full Year
    (in thousands, except per share data)       2012          2012
    RSA amortization expense                    $   10,097    $  10,097
    Management fee expense                         1,010       1,010
    Operating income impact                     $   9,087     $  9,087
                                                              

SPECIAL NOTE REGARDING FORWARD-LOOKING INFORMATION

The financial results set forth in this press release are preliminary. Our
disclosure and analysis in this press release, which do not present historical
information, contain “forward-looking statements” within the meaning of the
U.S. Private Securities Litigation Reform Act of 1995. Forward-looking
statements convey our current expectations or forecasts of future events. You
can identify these statements because they do not relate strictly to
historical or current facts. They use words such as “anticipate,” “estimate,”
“expect,” “project,” “intend,” “plan,” “believe,” and other words and terms of
similar meaning. They also appear in any discussion of future operating or
financial performance. In particular, these include statements relating to
future actions, future performance of our products, expenses, the outcome of
any legal proceedings, and financial results. Although we believe that we are
basing our expectations and beliefs on reasonable assumptions within the
bounds of what we currently know about our business and operations, the
economy and other conditions, there can be no assurance that our actual
results will not differ materially from what we expect or believe. Therefore,
you should proceed with caution in relying on any of these forward-looking
statements. They are neither statements of historical fact nor guarantees or
assurances of future performance.

Forward-looking statements involve a number of known and unknown risks,
uncertainties and other important factors, some of which are listed below,
that are difficult to predict and could cause actual results and outcomes to
differ materially from any future results or outcomes expressed or implied by
such forward-looking statements. Some of the factors that could cause our
actual results to differ from our expectations or beliefs include a decline in
the securities markets that adversely affect our assets under management,
negative performance of our products, the failure to perform as required under
our investment management agreements, a general downturn in the economy that
negatively impacts our operations. We also direct your attention to the more
specific discussions of these and other risks, uncertainties and other
important factors contained in our Form 10-K and other public filings. Other
factors that could cause our actual results to differ may emerge from time to
time, and it is not possible for us to predict all of them. We do not
undertake to update publicly any forward-looking statements if we subsequently
learn that we are unlikely to achieve our expectations whether as a result of
new information, future developments or otherwise, except as may be required
by law.

                                                                     
The Company reported Assets Under Management as follows (in millions):
                  
Table I: Fund Flows - 4th
Quarter 2013
                                                           Fund
                                Market                     distributions,
                    September   appreciation/    Net       net of           December
                    30,                          cash                       31,
                    2013        (depreciation)  flows     reinvestments    2013
Equities:
Open-end            $  15,581   $     1,218      $ 330     $   (51    )     $ 17,078
Funds
Closed-end             6,721          364          (2  )       (138   )       6,945
Funds
Institutional
& PWM -                15,026         1,498        (38 )       -              16,486
direct
Institutional
& PWM -                3,503          328          (34 )       -              3,797
sub-advisory
Investment             805            11           (5  )       -              811
Partnerships
SICAV (a)             94            2           -         -            96
Total                 41,730        3,421       251       (189   )      45,213
Equities
Fixed Income:
Money-Market           1,714          -            21          -              1,735
Fund
Institutional         63            -           (1  )      -            62
& PWM
Total Fixed           1,777         -           20        -            1,797
Income
Total Assets
Under               $  43,507   $     3,421      $ 271    $   (189   )     $ 47,010
Management
                                                                              

                                                                     
The Company reported Assets Under Management as follows (in millions):
                                                                             
Table II: Fund Flows - Full
Year 2013
                                                            Fund
                               Market                       distributions,
                    December   appreciation/    Net cash    net of           December
                    31,                                                      31,
                    2012       (depreciation)  flows       reinvestments    2013
Equities:
Open-end            $ 12,502   $     3,271      $ 1,446     $   (141   )     $ 17,078
Funds
Closed-end            6,288          991          150           (484   )       6,945
Funds
Institutional
& PWM -               12,030         4,287        169           -              16,486
direct
Institutional
& PWM -               2,924          1,007        (134  )       -              3,797
sub-advisory
Investment            801            41           (31   )       -              811
Partnerships
SICAV (a)            119           6           (29   )      -            96
Total                34,664        9,603       1,571       (625   )      45,213
Equities
Fixed Income:
Money-Market          1,681          -            54            -              1,735
Fund
Institutional        60            -           2           -            62
& PWM
Total Fixed          1,741         -           56          -            1,797
Income
Total Assets
Under               $ 36,405   $     9,603      $ 1,627    $   (625   )     $ 47,010
Management
                                                                             

                                                              
Table III: Assets Under
Management
                                      December 31,   December 31,   %
                                      2012           2013           Inc.(Dec.)
Equities:
Open-end Funds                        $   12,502     $   17,078     36.6    %
Closed-end Funds                          6,288          6,945      10.4
Institutional & PWM - direct              12,030         16,486     37.0
Institutional & PWM -                     2,924          3,797      29.9
sub-advisory
Investment Partnerships                   801            811        1.2
SICAV (a)                                119           96         (19.3   )
Total Equities                           34,664        45,213     30.4
Fixed Income:
Money-Market Fund                         1,681          1,735      3.2
Institutional & PWM                      60            62         3.3
Total Fixed Income                       1,741         1,797      3.2
Total Assets Under Management         $   36,405     $   47,010     29.1    %
                                                                    

                                                                               
Table IV: Assets Under Management by
Quarter
                          
                                                                           % ∆
                    12/12      3/13       6/13       9/13       12/13      12/12     9/13
Equities:
Open-end            $ 12,502   $ 13,813   $ 14,188   $ 15,581   $ 17,078   36.6  %   9.6  %
Funds
Closed-end            6,288      6,557      6,409      6,721      6,945    10.4      3.3
Funds
Institutional
& PWM -               12,030     13,690     14,069     15,026     16,486   37.0      9.7
direct
Institutional
& PWM -               2,924      3,299      3,185      3,503      3,797    29.9      8.4
sub-advisory
Investment            801        796        778        805        811      1.2       0.7
Partnerships
SICAV (a)            119       113       93        94        96       (19.3 )   2.1
Total                34,664    38,268    38,722    41,730    45,213   30.4      8.3
Equities
Fixed Income:
Money-Market          1,681      1,758      1,689      1,714      1,735    3.2       1.2
Fund
Institutional        60        64        67        63        62       3.3       (1.6 )
& PWM
Total Fixed          1,741     1,822     1,756     1,777     1,797    3.2       1.1
Income
Total Assets
Under               $ 36,405   $ 40,090   $ 40,478   $ 43,507   $ 47,010   29.1  %   8.1  %
Management
                                                                                     

      Includes $104 million, $99 million, $90 million, $92 million and $94
(a)  million of proprietary seed capital at December 31, 2012, March 31,
      2013, June 30, 2013, September 30, 2013 and December 31, 2013,
      respectively.

                                                                
Table V
                                                                       
GAMCO INVESTORS, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share data)
                                                                       
                                      For the Quarter Ended December 31,
                                                                       % Inc.
                                      2012               2013          (Dec.)
                                                                       
Investment advisory and               $ 85,697           $ 106,170     23.9  %
incentive fees
Distribution fees and other             11,080             14,544      31.3
income
Institutional research services        2,500            2,000      (20.0 )
Total revenues                          99,277             122,714     23.6
                                                                       
Compensation costs                      50,383     (a)     50,656      0.5
Distribution costs                      10,267             13,286      29.4
Other operating expenses               10,725           7,225      (32.6 )
Total expenses                          71,375             71,167      (0.3  )
                                                                       
Operating income before                 27,902             51,547      84.7
management fee
                                                                       
Investment income                       7,220              14,385
Extinguishment of debt                  -                  (861    )
Interest expense                        (3,480 )           (2,063  )
Shareholder-designated                 -                (5,313  )
contribution
Other income, net                      3,740            6,148   
                                                                       
Income before management fee            31,642             57,695      82.3
and income taxes
Management fee expense                 3,163            4,374   
Income before income taxes              28,479             53,321      87.2
Income tax expense                     10,812           19,752  
Net income                              17,667             33,569      90.0
Net income attributable to             73               252     
noncontrolling interests
Net income attributable to            $ 17,594          $ 33,317     89.4
GAMCO Investors, Inc.
                                                                       
Net income per share
attributable to GAMCO                                    
Investors, Inc.:
Basic                                 $ 0.67            $ 1.30       94.0
                                                                       
Diluted                               $ 0.67            $ 1.29       92.5
                                                                       
Weighted average shares
outstanding:
Basic                                  26,208           25,567     (2.4  )
                                                                       
Diluted                                26,305           25,733     (2.2  )
                                                                       
Actual shares outstanding (b)          25,746           26,086     1.3   %
                                                                       

Notes:
(a)  Includes $10.1 million in expenses from the acceleration of RSAs.
(b)   Includes 0 and 566,950 of RSAs, respectively.
See GAAP to non-GAAP reconciliation on page 12.

                                                                
Table VI
                                                                       
GAMCO INVESTORS, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share data)
                                                                       
                                     For the Year Ended December 31,
                                                                       % Inc.
                                     2012                2013          (Dec.)
                                                                       
Investment advisory and              $ 288,480           $ 336,658     16.7  %
incentive fees
Distribution fees and other            44,848              51,964      15.9
income
Institutional research                10,953            8,940      (18.4 )
services
Total revenues                         344,281             397,562     15.5
                                                                       
Compensation costs                     150,806     (a)     163,870     8.7
Distribution costs                     40,842              48,936      19.8
Other operating expenses              28,485            23,515     (17.4 )
Total expenses                         220,133             236,321     7.4
                                                                       
Operating income before                124,148             161,241     29.9
management fee
                                                                       
Investment income                      28,392              63,274
Extinguishment of debt                 (6,307  )           (998    )
Interest expense                       (15,899 )           (10,511 )
Shareholder-designated                -                 (10,626 )
contribution
Other income, net                     6,186             41,139  
                                                                       
Income before management fee           130,334             202,380     55.3
and income taxes
Management fee expense                13,018            18,829  
Income before income taxes             117,316             183,551     56.5
Income tax expense                    41,721            66,186  
Net income                             75,595              117,365     55.3
Net income attributable to            56                512     
noncontrolling interests
Net income attributable to           $ 75,539           $ 116,853    54.7
GAMCO Investors, Inc.
                                                                       
Net income per share
attributable to GAMCO
Investors, Inc.:
Basic                                $ 2.87             $ 4.56       58.9
                                                                       
Diluted                              $ 2.86             $ 4.54       58.7
                                                                       
Weighted average shares
outstanding:
Basic                                 26,283            25,653     (2.4  )
                                                                       
Diluted                               26,436            25,712     (2.7  )
                                                                       
Actual shares outstanding (b)         25,746            26,086     1.3   %
                                                                       

Notes:
(a)  Includes $10.1 million in expenses from the acceleration of RSAs.
(b)   Includes 0 and 566,950 of RSAs, respectively.
See GAAP to non-GAAP reconciliation on page 12.

                                                                                                                                                 
Table VII
GAMCO INVESTORS, INC.
UNAUDITED QUARTERLY CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share data)
                                                                                                                                                                
                             2012                                                                          2013
                             1st          2nd          3rd                4th                              1st          2nd          3rd          4th
                             Quarter      Quarter      Quarter            Quarter            Full Year     Quarter      Quarter      Quarter      Quarter       Full Year
Income Statement Data:
                                                                                                                                                                
Revenues                     $ 81,749     $ 81,024     $ 82,231           $ 99,277           $ 344,281     $ 86,181     $ 92,290     $ 96,377     $ 122,714     $ 397,562
                                                                                                                                                                
Expenses                      50,553     48,042     50,163           71,375    (a)    220,133     51,474     55,660     58,020     71,167      236,321 
                                                                                                                                                                
Operating income
before
management fee                 31,196       32,982       32,068             27,902             124,148       34,707       36,630       38,357       51,547        161,241
                                                                                                                                                                
Investment                     15,114       (2,389 )     2,140      (b)     7,220              22,085        13,636       14,648       20,468       13,524        62,276
income/(loss)
Interest expense               (4,404 )     (4,429 )     (3,586 )           (3,480 )           (15,899 )     (3,488 )     (2,796 )     (2,164 )     (2,063  )     (10,511 )
Shareholder-designated        -          -          -                -                -           (5,000 )    -          (313   )    (5,313  )    (10,626 )
contribution
Other                          10,710       (6,818 )     (1,446 )           3,740              6,186         5,148        11,852       17,991       6,148         41,139
income/(expense), net
                                                                                                                                                                
Income before
management
fee and income taxes           41,906       26,164       30,622             31,642             130,334       39,855       48,482       56,348       57,695        202,380
Management fee expense        4,184      2,615      3,056            3,163            13,018      3,980      4,846      5,629      4,374       18,829  
Income before income           37,722       23,549       27,566             28,479             117,316       35,875       43,636       50,719       53,321        183,551
taxes
Income tax expense            13,756     8,686      8,467            10,812           41,721      13,195     15,724     17,515     19,752      66,186  
Net income                     23,966       14,863       19,099             17,667             75,595        22,680       27,912       33,204       33,569        117,365
Net income/(loss)
attributable
to noncontrolling             130        (242   )    95               73               56          135        19         106        252         512     
interests
Net income
attributable to
GAMCO Investors, Inc.        $ 23,836    $ 15,105    $ 19,004          $ 17,594          $ 75,539     $ 22,545    $ 27,893    $ 33,098    $ 33,317     $ 116,853 
                                                                                                                                                                
Net income per share
attributable to GAMCO
Investors, Inc.:
Basic                        $ 0.90      $ 0.58      $ 0.72            $ 0.67            $ 2.87       $ 0.88      $ 1.09      $ 1.29      $ 1.30       $ 4.56    
                                                                                                                                                                
Diluted                      $ 0.90      $ 0.57      $ 0.72            $ 0.67            $ 2.86       $ 0.88      $ 1.09      $ 1.29      $ 1.29       $ 4.54    
                                                                                                                                                                
Weighted average
shares outstanding:
Basic                         26,415     26,258     26,250           26,208           26,283      25,742     25,679     25,625     25,567      25,653  
                                                                                                                                                                
Diluted                       26,533     26,426     26,439           26,305           26,436      25,758     25,689     25,700     25,733      25,712  
Reconciliation of
non-GAAP
financial measures to
GAAP:
Operating income
before
management fee               $ 31,196     $ 32,982     $ 32,068           $ 27,902           $ 124,148     $ 34,707     $ 36,630     $ 38,357     $ 51,547      $ 161,241
Deduct: management fee        4,184      2,615      3,056            3,163            13,018      3,980      4,846      5,629      4,374       18,829  
expense
Operating income             $ 27,012    $ 30,367    $ 29,012          $ 24,739          $ 111,130    $ 30,727    $ 31,784    $ 32,728    $ 47,173     $ 142,412 
                                                                                                                                                                
Operating margin
before
management fee                38.2   %    40.7   %    39.0   %          28.1   %          36.1    %    40.3   %    39.7   %    39.8   %    42.0    %    40.6    %
Operating margin after
management fee                33.0   %    37.5   %    35.3   %          24.9   %          32.3    %    35.7   %    34.4   %    34.0   %    38.4    %    35.8    %
                                                                                                                                                                

(a)  Includes $10.1 million in expenses from the acceleration of RSAs.
(b)   Includes $6.3 million loss on extinguishment of $64.6 million (face
      value) of 0% Subordinated Debentures.

                                                             
Table VIII
GAMCO INVESTORS, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Dollars in thousands, except per share data)
                                                                  
                                                   December 31,   December 31,
                                                   2012           2013
                                                                  
ASSETS
                                                                  
Cash and cash equivalents                          $   190,608    $   210,451
Investments (a)                                        378,263        371,262
Receivable from brokers                                50,655         49,461
Other receivables                                      52,600         60,390
Income tax receivable                                  1,014          445
Other assets                                          17,589        17,477
                                                                  
Total assets                                       $   690,729    $   709,486
                                                                  
LIABILITIES AND EQUITY
                                                                  
Payable to brokers                                 $   14,346     $   10,765
Income taxes payable and deferred tax                                 39,846
liabilities                                            25,394
                                                                      
Compensation payable                                   10,535         34,663
Securities sold short, not yet purchased               3,136          6,178
Accrued expenses and other liabilities                32,656        39,190
Sub-total                                              86,067         130,642
                                                                  
5.5% Senior notes (repaid May 15, 2013)                99,000         -
5.875% Senior notes (due June 1, 2021)                 100,000        100,000
0% Subordinated Debentures (due December 31,          17,366        11,911
2015) (b)
Total debt                                            216,366       111,911
Total liabilities                                      302,433        242,553
                                                                  
Redeemable noncontrolling interests                    17,362         6,751
                                                                  
GAMCO Investors, Inc.'s stockholders' equity           367,608        457,331
Noncontrolling interests                              3,326         2,851
Total equity                                          370,934       460,182
                                                                  
Total liabilities and equity                       $   690,729    $   709,486
                                                                  

(a)  Includes investments in sponsored registered investment companies of
      $61.9 million and $44.0 million, respectively.
(b)   The 0% Subordinated Debentures due December 31, 2015 have a face value
      of $21.7 million and $13.8 million, respectively.

Contact:

GAMCO Investors, Inc.
Robert S. Zuccaro, 914-921-5088
Executive Vice President
and Chief Financial Officer
or
For further information please visit
www.gabelli.com
 
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