- Second quarter GAAP revenues of $179.9 million; second quarter
Adjusted revenues of $182.2 million, down 23% from the prior year
period
- First half GAAP revenues of $367.7 million; first half Adjusted
revenues of $367.5 million, down 31% from the first half of
2022
- GAAP net loss of $0.17 per share for the second quarter of 2023
and $0.12 per share for the first half of 2023; Adjusted net loss
of $0.04 per share for the second quarter of 2023 and Adjusted net
income of $0.02 per share (diluted) for the first half of 2023,
after excluding $10.4 million of expense related to an agreed in
principle regulatory settlement
- Continued to execute on our growth strategy: ― In the first
half of 2023, we hired 19 Managing Directors across areas of key
strategic importance to the firm including Technology, Industrials,
M&A, Capital Structure Advisory, Capital Markets, Private Funds
Advisory and regional coverage in France ― Additionally, two
Industrials-focused Managing Directors will join the Firm in the
coming months
- Strong balance sheet with cash and short term investments of
$194.8 million and no debt or goodwill ― Declared quarterly
dividend of $0.60 per share
Moelis & Company (NYSE: MC) today reported financial results
for the quarter ended June 30, 2023. The Firm's second quarter GAAP
revenues were $179.9 million as compared with $242.5 million in the
prior year period. On an Adjusted basis, the Firm’s second quarter
revenues of $182.2 million decreased 23% from the prior year
period. The Firm reported a GAAP net loss of $13.2 million and
$0.17 per share for the second quarter of 2023. On an Adjusted
basis, the Firm reported a net loss of $2.6 million and $0.04 per
share for the second quarter of 2023, which compares with net
income of $43.2 million and $0.57 per share (diluted) in the prior
year period. Adjusted net loss for the second quarter of 2023
excludes $10.4 million of expense related to an agreement in
principle with the staff of the U.S. Securities and Exchange
Commission (the "SEC") to resolve an investigation of our practices
relating to recordkeeping of business communications on messaging
applications (the "Settlement"). The Settlement will include a
civil penalty of $10.0 million and we have incurred $0.4 million of
related expenses. The Settlement is subject to approval by the
SEC.
GAAP revenues for the first half of 2023 were $367.7 million.
Adjusted revenues for the first half of 2023 were $367.5 million
and represented a decrease of 31% from the prior year period. The
Firm reported a GAAP net loss of $9.7 million, or $0.12 per share
for the first half of 2023, as compared with GAAP net income of
$117.5 million, or $1.49 per share (diluted), in the first half of
2022. On an Adjusted basis, the Firm reported net income of $1.2
million, or $0.02 per share (diluted) in the first half of 2023, as
compared with $116.2 million, or $1.52 per share (diluted), in the
prior year period. Adjusted net income for the first half of 2023
excludes $10.4 million of expense related to the Settlement. GAAP
and Adjusted net income in the first half of 2023 include net tax
benefits of approximately $0.05 per share related to the settlement
of share based awards.
"Our strategic investments in talent over the last year better
position us to provide innovative solutions to clients in the
largest and most disruptive areas of the global economy," said Ken
Moelis, Chairman and Chief Executive Officer.
The Firm’s revenues and net income can fluctuate materially
depending on the number, size and timing of completed transactions
as well as other factors. Accordingly, financial results in any
particular quarter may not be representative of future results over
a longer period of time.
Currently 91% of the operating partnership (Moelis & Company
Group LP) is owned by the corporate partner (Moelis & Company)
and is subject to corporate U.S. federal and state income tax. The
remaining 9% is owned by other partners of Moelis & Company
Group LP and is primarily subject to U.S. federal tax at the
partner level (certain state, local and foreign income taxes are
incurred at the company level). The Adjusted results included
herein apply certain adjustments from our GAAP results, including
the assumption that 100% of the Firm’s second quarter operating
result was taxed at our corporate effective tax rate. We believe
the Adjusted results, when presented together with comparable GAAP
results, are useful to investors to compare our performance across
periods and to better understand our operating results. A
reconciliation between our GAAP results and our Adjusted results is
presented in the Appendix to this press release.
GAAP and Adjusted (non-GAAP) Selected
Financial Data (Unaudited)
GAAP
Adjusted (non-GAAP)*
Three Months Ended June
30,
($ in thousands except per share
data)
2023
2022
2023 vs. 2022 Variance
2023
2022
2023 vs. 2022 Variance
Revenues
$
179,871
$
242,520
-26
%
$
182,243
$
237,444
-23
%
Income (loss) before income
taxes
(15,215)
59,153
N/M
(4,574)
59,153
N/M
Provision (benefit) for income taxes
(1,969)
15,296
N/M
(1,936)
15,926
N/M
Net income (loss)
(13,246)
43,857
N/M
(2,638)
43,227
N/M
Net income (loss) attributable to
noncontrolling interests
(1,272)
4,894
N/M
—
—
N/M
Net income (loss) attributable to Moelis
& Company
$
(11,974)
$
38,963
N/M
$
(2,638)
$
43,227
N/M
Diluted earnings (loss) per share
$
(0.17)
$
0.56
N/M
$
(0.04)
$
0.57
N/M
N/M = not meaningful
* See Appendix for a reconciliation of
GAAP to Adjusted (non-GAAP)
GAAP
Adjusted (non-GAAP)*
Six Months Ended June
30,
($ in thousands except per share
data)
2023
2022
2023 vs. 2022 Variance
2023
2022
2023 vs. 2022 Variance
Revenues
$
367,691
$
544,608
-32
%
$
367,542
$
535,652
-31
%
Income (loss) before income
taxes
(14,860)
146,345
N/M
(4,219)
146,345
N/M
Provision (benefit) for income taxes
(5,177)
28,894
N/M
(5,408)
30,102
N/M
Net income (loss)
(9,683)
117,451
N/M
1,189
116,243
-99
%
Net income (loss) attributable to
noncontrolling interests
(1,375)
12,773
N/M
—
—
N/M
Net income (loss) attributable to Moelis
& Company
$
(8,308)
$
104,678
N/M
$
1,189
$
116,243
-99
%
Diluted earnings (loss) per share
$
(0.12)
$
1.49
N/M
$
0.02
$
1.52
-99
%
N/M = not meaningful
* See Appendix for a reconciliation of
GAAP to Adjusted (non-GAAP)
Revenues
We earned GAAP revenues of $179.9 million in the second quarter
of 2023, as compared with $242.5 million in the prior year period.
On an Adjusted basis, we earned revenues of $182.2 million in the
second quarter of 2023, as compared with $237.4 million in the
prior year period, representing a decrease of 23%. This compares
with a 46%1 decrease in the number of global completed M&A
transactions greater than $100 million in the same period. The
decrease in second quarter revenues was driven by fewer transaction
completions as compared with the prior year period.
For the first half of 2023, we earned GAAP revenues of $367.7
million, as compared with $544.6 million in the prior year period.
On an Adjusted basis, we earned revenues of $367.5 million in the
first half of 2023, as compared with $535.7 million in the first
half of 2022, or a decrease of 31%.
We continued to execute on our strategy of organic growth. In
the first half of 2023, we hired 19 Managing Directors focused on
key areas of strategic importance to the Firm including Technology,
Industrials, M&A, Capital Structure Advisory, Capital Markets,
Private Funds Advisory and regional coverage in France.
Additionally, two Industrials-focused Managing Directors will join
the Firm in the coming months.
1Source: Refinitiv as of July 6, 2023; includes all globally
completed transactions greater than $100mm
Expenses
The following tables set forth information relating to the
Firm’s operating expenses.
GAAP
Adjusted (non-GAAP)*
Three Months Ended June
30,
($ in thousands)
2023
2022
2023 vs. 2022 Variance
2023
2022
2023 vs. 2022 Variance
Expenses:
Compensation and benefits
$
145,794
$
140,092
4
%
$
145,794
$
140,092
4
%
% of revenues
81.1
%
57.8
%
80.0
%
59.0
%
Non-compensation expenses
$
43,663
$
40,229
9
%
$
43,243
$
40,229
7
%
% of revenues
24.3
%
16.6
%
23.7
%
16.9
%
Total operating expenses
$
189,457
$
180,321
5
%
$
189,037
$
180,321
5
%
% of revenues
105.3
%
74.4
%
103.7
%
75.9
%
* See Appendix for a reconciliation of
GAAP to Adjusted (non-GAAP)
GAAP
Adjusted (non-GAAP)*
Six Months Ended June
30,
($ in thousands)
2023
2022
2023 vs. 2022 Variance
2023
2022
2023 vs. 2022 Variance
Expenses:
Compensation and benefits
$
294,033
$
316,729
-7
%
$
294,033
$
316,035
-7
%
% of revenues
80.0
%
58.2
%
80.0
%
59.0
%
Non-compensation expenses
$
84,635
$
76,253
11
%
$
84,215
$
76,253
10
%
% of revenues
23.0
%
14.0
%
22.9
%
14.2
%
Total operating expenses
$
378,668
$
392,982
-4
%
$
378,248
$
392,288
-4
%
% of revenues
103.0
%
72.2
%
102.9
%
73.2
%
* See Appendix for a reconciliation of
GAAP to Adjusted (non-GAAP)
Total operating expenses on a GAAP basis were $189.5 million for
the second quarter of 2023. On an Adjusted basis, operating
expenses were $189.0 million for the second quarter of 2023, as
compared with $180.3 million in the prior year period. The increase
in operating expenses in the second quarter of 2023 is attributable
to an increase in both compensation and benefits expenses and
non-compensation expenses as compared with the prior year period.
For the first half of 2023, total operating expenses on a GAAP
basis were $378.7 million. On an Adjusted basis, operating expenses
were $378.2 million for the first half of 2023 as compared with
$392.3 million in the prior year period. The decrease in Adjusted
operating expenses in the first half of 2023 is primarily due to a
decrease in compensation and benefits expenses, partially offset by
an increase in non-compensation expenses as compared with the prior
year period.
Compensation and benefits expenses on a GAAP and Adjusted basis
were $145.8 million for the second quarter of 2023 as compared with
$140.1 million in the prior year period. The increase in
compensation and benefits expenses for the second quarter of 2023
is primarily attributable to increased headcount. For the first
half of 2023, compensation and benefits expenses on a GAAP and
Adjusted basis were $294.0 million, as compared with Adjusted
compensation and benefits expenses of $316.0 million in the prior
year period. The decrease in compensation and benefits expenses
during the first half of 2023 is attributable to a lower bonus
expense accrual, associated with lower revenues earned as compared
with the prior year period.
Non-compensation expenses on a GAAP basis were $43.7 million for
the second quarter of 2023 as compared with $40.2 million in the
prior year period. Adjusted non-compensation expenses for the
second quarter of 2023 were $43.2 million as compared with $40.2
million in the prior year period. The increase in Adjusted
non-compensation expenses in the second quarter of 2023 is
primarily attributable to increased headcount as compared with the
prior year period. For the first half of 2023, GAAP
non-compensation expenses were $84.6 million as compared with $76.3
million in the prior year period. On an Adjusted basis,
non-compensation expenses were $84.2 million as compared with $76.3
million in the prior year period. The increase in Adjusted
non-compensation expenses for the first half of 2023 is primarily
attributable to an increase in deal-related travel and
entertainment, communications and technology expenses and
professional fees.
Other Income (Expenses)
GAAP
Adjusted (non-GAAP)*
Three Months Ended June
30,
($ in thousands)
2023
2022
2023 vs. 2022 Variance
2023
2022
2023 vs. 2022 Variance
Other income (expenses)
$
(5,629)
$
(3,046)
85
%
$
2,220
$
2,030
9
%
N/M = not meaningful
* See Appendix for a reconciliation of
GAAP to Adjusted (non-GAAP)
GAAP
Adjusted (non-GAAP)*
Six Months Ended June
30,
($ in thousands)
2023
2022
2023 vs. 2022 Variance
2023
2022
2023 vs. 2022 Variance
Other income (expenses)
$
(3,883)
$
(5,281)
-26
%
$
6,487
$
2,981
118
%
N/M = not meaningful
* See Appendix for a reconciliation of
GAAP to Adjusted (non-GAAP)
Other income (expenses) on a GAAP basis was expense of $5.6
million for the second quarter of 2023, as compared with expense of
$3.0 million in the prior year period. On an Adjusted basis, other
income for the second quarter of 2023 was $2.2 million, as compared
with $2.0 million in the prior year period. In the second quarter
of 2023, we recorded gains of $2.4 million from the mark-to-market
impact on certain shares held and sold during the period. The
economics of the $2.4 million in gains are included within Adjusted
revenues and did not impact our GAAP or Adjusted earnings per
share.
For the first half of 2023, other income (expenses) on a GAAP
basis was expense of $3.9 million as compared with $5.3 million in
the prior year period. On an Adjusted basis, other income for the
first half of 2023 was $6.5 million as compared with $3.0 million
in the first half of 2022. For the first half of 2023, we recorded
losses of $0.1 million from the mark-to-market impact on certain
shares held and sold during the period. The economics of the $0.1
million in losses are included within Adjusted revenues and did not
impact our GAAP or Adjusted earnings per share.
Adjusted other income for the second quarter and first half of
2023 excludes $10.0 million of expenses related to the
Settlement.
Provision for Income Taxes
The corporate partner (Moelis & Company) currently owns 91%
of the operating partnership (Moelis & Company Group LP) and is
subject to corporate U.S. federal and state income tax on its
allocable share of earnings. The remaining 9% of activity is
subject to certain state, local and foreign income taxes (including
New York City Unincorporated Business Tax), which is accounted for
at the partner level through the noncontrolling interests. For
Adjusted purposes, we have assumed that 100% of the Firm’s second
quarter 2023 operating results were taxed at our corporate
effective tax rate resulting in a net tax benefit of approximately
$1.9 million.
Capital Management and Balance Sheet
Moelis & Company continues to maintain a strong financial
position, and as of June 30, 2023, we held cash and liquid
investments of $194.8 million and had no debt or goodwill on our
balance sheet.
The Board of Directors of Moelis & Company declared a
regular quarterly dividend of $0.60 per share. The $0.60 per share
will be paid on September 22, 2023 to common stockholders of record
on August 7, 2023.
Earnings Call
We will host a conference call beginning at 5:00pm ET on
Wednesday, July 26, 2023, accessible via telephone and the
internet. Ken Moelis, Chairman and Chief Executive Officer, and Joe
Simon, Chief Financial Officer, will review our second quarter 2023
financial results. Following the review, there will be a question
and answer session.
Investors and analysts may participate in the live conference
call by dialing 1-888-300-4150 (domestic) or 1-646-970-1530
(international) and using access code 8014191. Please dial in 15
minutes before the conference call begins. The conference call will
also be accessible as a listen-only audio webcast through the
Investor Relations section of the Moelis & Company website at
www.moelis.com.
For those unable to listen to the live broadcast, a replay of
the call will be available for one month via telephone starting
approximately one hour after the live call ends. The replay can be
accessed at 1-800-770-2030 (domestic) or 1-647-362-9199
(international); the conference number is 8014191.
About Moelis &
Company
Moelis & Company is a leading global independent investment
bank that provides innovative strategic advice and solutions to a
diverse client base, including corporations, governments and
financial sponsors. The Firm assists its clients in achieving their
strategic goals by offering comprehensive integrated financial
advisory services across all major industry sectors. Moelis &
Company’s experienced professionals advise clients on their most
critical decisions, including mergers and acquisitions,
recapitalizations and restructurings, capital markets transactions,
private fund raisings and secondary transactions and other
corporate finance matters. The Firm serves its clients from 23
locations in North and South America, Europe, the Middle East, Asia
and Australia. For further information, please visit:
www.moelis.com or follow us on Twitter @Moelis.
Forward-Looking
Statements
This press release contains forward-looking statements, which
reflect the Firm’s current views with respect to, among other
things, its operations and financial performance. You can identify
these forward-looking statements by the use of words such as
“outlook,” “believes,” “expects,” “potential,” “continues,” “may,”
“will,” “should,” “seeks,” “target,” “approximately,” “predicts,”
“intends,” “plans,” “estimates,” “anticipates” or the negative
version of these words or other comparable words. Such
forward-looking statements are based on certain assumptions and
estimates and subject to various risks and uncertainties.
Accordingly, there are or will be important factors that could
cause actual outcomes or results to differ materially from those
indicated in these statements. We believe these factors include,
but are not limited to, those described under "Risk Factors"
discussed in our Annual Report on Form 10-K for the year ended
December 31, 2022, subsequent reports filed on Form 10-Q and our
other filings with the SEC. These factors should not be construed
as exhaustive and should be read in conjunction with the other
cautionary statements that are included in this release. In
addition, new risks and uncertainties emerge from time to time, and
it is not possible for us to predict all risks and uncertainties,
nor can we assess the impact of all factors on our business or the
extent to which any factor, or combination of factors, may cause
actual results to differ materially from those contained in any
forward-looking statements. Accordingly, you should not rely upon
forward-looking statements as a prediction of actual results. The
Firm undertakes no obligation to publicly update or review any
forward-looking statement, whether as a result of new information,
future developments or otherwise.
Non-GAAP Financial
Measures
The Company prepares its consolidated financial statements using
accounting principles generally accepted in the United States
(GAAP). From time to time, the Company may disclose certain
“non-GAAP financial measures” in the course of its earnings
releases, earnings conference calls, financial presentations and
otherwise. The Securities and Exchange Commission defines a
“non-GAAP financial measure” as a numerical measure of historical
or future financial performance, financial position, or cash flows
that is subject to adjustments that effectively exclude, or include
amounts from the most directly comparable measure calculated and
presented in accordance with GAAP. Non-GAAP financial measures
disclosed by the Company are provided as additional information to
analysts, investors and other stakeholders in order to provide them
with greater transparency about, or an alternative method for
assessing our financial condition, operating results, or capital
adequacy. Adjusted results are a non-GAAP financial measure which
provide additional information on management’s view of operating
results. These measures are not in accordance with, or a substitute
for GAAP, and may be different from or inconsistent with non-GAAP
financial measures used by other companies. Whenever we refer to a
non-GAAP financial measure, we will also generally define it or
present the most directly comparable financial measure calculated
and presented in accordance with GAAP, along with a reconciliation
of the differences between the non-GAAP financial measure we
reference and such comparable GAAP financial measure.
The Company’s Adjusted revenues includes amounts reflected
within other income (expenses) which are considered the equivalent
of revenues for compensation. Such adjustments may include gains on
founder investments where our employees and the Moelis advisory
platform contributed meaningfully to the value creation; or the
mark-to-market impact of equity instruments held by the Company
that were originally received as payment for our banking services
and included in revenues. We believe these adjustments are useful
to allow comparability of period-to-period operating performance
and compensation levels.
The Company’s Adjusted compensation and benefits expenses may
include adjustments reflected within other income (expenses)
associated with compensation awards forfeited due to the
enforcement of non-compete provisions. Management views the credits
associated with such forfeitures as an offset to compensation and
benefits expenses since the Firm will utilize the forfeited
economics to recruit and or retain talent. We believe the netted
presentation of forfeiture credits and compensation expenses is
useful to allow comparability of period-to-period operating
performance.
The Company’s Adjusted other income (expenses) may exclude
certain one-time items that reduce the comparability of our
operating performance as well as the amounts related to revenues
and compensation and benefits expenses discussed above and
adjustments to our provision for income taxes discussed below. Such
adjustments increase the comparability of our financial performance
across reporting periods and versus our peers.
The Company’s Adjusted provision (benefit) for income taxes is
adjusted to illustrate the result as if 100% of the Firm’s income
is being taxed at our corporate effective tax rates for the periods
presented. Adjusted provision (benefit) for income taxes
periodically includes the tax impact related to the settlement of
share-based awards, the reclassification of TRA liability
adjustments, or adjustments to our deferred tax assets and
liabilities that occur in connection with new tax legislation. Such
adjustments increase the comparability of our financial performance
across reporting periods and versus our peers.
The Company’s Adjusted basic and diluted shares of Class A
common stock outstanding is presented for each period as if all
outstanding Class A partnership units have been exchanged into
Class A common stock. The Adjusted presentation helps analysts,
investors, and other stakeholders understand the effect of the
Firm’s ownership structure on its results, including the impact of
all the Firm’s income becoming subject to corporate-level tax.
Appendix
GAAP Consolidated Statement of Operations (Unaudited)
Reconciliation of GAAP to Adjusted (non-GAAP) Financial
Information (Unaudited)
Moelis & Company
GAAP Consolidated Statement of
Operations
Unaudited
(dollars in thousands, except
for share and per share data)
Three Months Ended June
30,
Six Months Ended June
30,
2023
2022
2023
2022
Revenues
$
179,871
$
242,520
$
367,691
$
544,608
Expenses
Compensation and benefits
145,794
140,092
294,033
316,729
Occupancy
6,872
6,267
12,706
12,077
Professional fees
6,907
5,570
11,853
9,885
Communication, technology and information
services
11,215
10,108
22,049
18,887
Travel and related expenses
9,213
9,366
20,181
17,009
Depreciation and amortization
1,936
1,841
4,009
3,880
Other expenses
7,520
7,077
13,837
14,515
Total Expenses
189,457
180,321
378,668
392,982
Operating income (loss)
(9,586)
62,199
(10,977)
151,626
Other income (expenses)
(5,629)
(3,046)
(3,883)
(5,281)
Income (loss) before income
taxes
(15,215)
59,153
(14,860)
146,345
Provision (benefit) for income taxes
(1,969)
15,296
(5,177)
28,894
Net income (loss)
(13,246)
43,857
(9,683)
117,451
Net income (loss) attributable to
noncontrolling interests
(1,272)
4,894
(1,375)
12,773
Net income (loss) attributable to Moelis
& Company
$
(11,974)
$
38,963
$
(8,308)
$
104,678
Weighted-average shares of Class A common
stock outstanding
Basic
68,504,772
66,290,442
67,852,077
65,572,013
Diluted
68,504,772
69,811,979
67,852,077
70,171,256
Net income (loss) attributable to holders
of shares of Class A common stock per share
Basic
$
(0.17)
$
0.59
$
(0.12)
$
1.60
Diluted
$
(0.17)
$
0.56
$
(0.12)
$
1.49
Moelis & Company
Reconciliation of GAAP to
Adjusted (non-GAAP) Financial Information
Unaudited
(dollars in thousands, except
share and per share data)
Three Months Ended June 30,
2023
Adjusted items
GAAP
Adjustments
Adjusted (non-GAAP)
Revenues
$
179,871
$
2,372
(a)
$
182,243
Non-compensation expenses
43,663
(420)
(b)
43,243
Other income (expenses)
(5,629)
7,849
(a)(b)(c)
2,220
Income (loss) before income taxes
(15,215)
10,641
(4,574)
Provision (benefit) for income taxes
(1,969)
33
(c)(d)
(1,936)
Net income (loss)
(13,246)
10,608
(2,638)
Net income (loss) attributable to
noncontrolling interests
(1,272)
1,272
(e)
—
Net income (loss) attributable to Moelis
& Company
$
(11,974)
$
9,336
$
(2,638)
Weighted-average shares of Class A common
stock outstanding
Basic
68,504,772
6,284,688
(e)
74,789,460
Diluted
68,504,772
6,284,688
(e)
74,789,460
Net income (loss) attributable to holders
of shares of Class A common stock per share
Basic
$
(0.17)
$
(0.04)
Diluted
$
(0.17)
$
(0.04)
(a)
Reflects a reclassification of $2.4
million of other income to revenues related to net gains from the
mark-to-market impact on shares received as partial payment for
advisory services provided on certain transactions.
(b)
Reflects adjustments of $10.4 million for
expenses related to the Settlement.
(c)
Tax Receivable Agreement liability related
adjustments are made to other income (expenses) for GAAP purposes.
The adjustment of $0.2 million is reclassified to the provision for
income taxes line.
(d)
An adjustment has been made to illustrate
the result as if 100% of the Firm’s income is being taxed at our
corporate effective tax rate. Our adjusted tax provision excludes
any benefits or costs related to the adjustment to the TRA
liability originated from past partnership unit exchanges; such
adjustment for this period was a net expense of $0.2 million, which
is not included in the corporate tax provision for the period
presented.
(e)
Assumes all outstanding Class A
partnership units have been exchanged into Class A common
stock.
Moelis & Company
Reconciliation of GAAP to
Adjusted (non-GAAP) Financial Information
Unaudited
(dollars in thousands, except
share and per share data)
Three Months Ended June 30,
2022
Adjusted items
GAAP
Adjustments
Adjusted (non-GAAP)
Revenues
$
242,520
$
(5,076)
(a)
$
237,444
Compensation and benefits
140,092
—
140,092
Other income (expenses)
(3,046)
5,076
(a)
2,030
Income (loss) before income taxes
59,153
—
59,153
Provision (benefit) for income taxes
15,296
630
(b)
15,926
Net income (loss)
43,857
(630)
43,227
Net income (loss) attributable to
noncontrolling interests
4,894
(4,894)
(c)
—
Net income (loss) attributable to Moelis
& Company
$
38,963
$
4,264
$
43,227
Weighted-average shares of Class A common
stock outstanding
Basic
66,290,442
5,940,806
(c)
72,231,248
Diluted
69,811,979
5,940,806
(c)
75,752,785
Net income (loss) attributable to holders
of shares of Class A common stock per share
Basic
$
0.59
$
0.60
Diluted
$
0.56
$
0.57
(a)
Reflects a reclassification of $5.1
million of other income to revenues related to unrealized losses
from the mark-to-market impact on shares received as partial
payment for advisory services provided on certain transactions.
(b)
An adjustment has been made to illustrate
the result as if 100% of the Firm’s income is being taxed at our
corporate effective tax rate of approximately 26.9% for the period
stated.
(c)
Assumes all outstanding Class A
partnership units have been exchanged into Class A common
stock.
Moelis & Company
Reconciliation of GAAP to
Adjusted (non-GAAP) Financial Information
Unaudited
(dollars in thousands, except
share and per share data)
Six Months Ended June 30,
2023
Adjusted items
GAAP
Adjustments
Adjusted (non-GAAP)
Revenues
$
367,691
$
(149)
(a)
$
367,542
Non-compensation expenses
84,635
(420)
(b)
84,215
Other income (expenses)
(3,883)
10,370
(a)(b)(c)
6,487
Income (loss) before income taxes
(14,860)
10,641
(4,219)
Provision (benefit) for income taxes
(5,177)
(231)
(c)(d)
(5,408)
Net income (loss)
(9,683)
10,872
1,189
Net income (loss) attributable to
noncontrolling interests
(1,375)
1,375
(e)
—
Net income (loss) attributable to Moelis
& Company
$
(8,308)
$
9,497
$
1,189
Weighted-average shares of Class A common
stock outstanding
Basic
67,852,077
6,190,394
(e)
74,042,471
Diluted
67,852,077
10,074,194
(e)
77,926,271
Net income (loss) attributable to holders
of shares of Class A common stock per share
Basic
$
(0.12)
$
0.02
Diluted
$
(0.12)
$
0.02
(a)
Reflects a reclassification of $0.1
million of other income to revenues related to net losses from the
mark-to-market impact on shares received as partial payment for
advisory services provided on certain transactions.
(b)
Reflects adjustments of $10.4 million for
expenses related to the Settlement.
(c)
Tax Receivable Agreement liability related
adjustments are made to other income (expenses) for GAAP purposes.
The adjustment of $0.2 million is reclassified to the provision for
income taxes line.
(d)
An adjustment has been made to illustrate
the result as if 100% of the Firm’s income is being taxed at our
corporate effective tax rate for the period stated; together with
the tax benefit related to the settlement of share-based awards of
$3.6 million, we have a net tax benefit of $5.4 million. Our
adjusted tax provision excludes any benefits or costs related to
the adjustment to the TRA liability originated from past
partnership unit exchanges; such adjustment for this period was a
net expense of $0.2 million, which is not included in the corporate
tax provision for the period presented.
(e)
Assumes all outstanding Class A
partnership units have been exchanged into Class A common stock.
Diluted share count includes dilutive shares pursuant to the
treasury stock method that are antidilutive to GAAP earnings per
share.
Moelis & Company
Reconciliation of GAAP to
Adjusted (non-GAAP) Financial Information
Unaudited
(dollars in thousands, except
share and per share data)
Six Months Ended June 30,
2022
Adjusted items
GAAP
Adjustments
Adjusted (non-GAAP)
Revenues
$
544,608
$
(8,956)
(a)
$
535,652
Compensation and benefits
316,729
(694)
(b)
316,035
Other income (expenses)
(5,281)
8,262
(a)(b)
2,981
Income (loss) before income taxes
146,345
—
146,345
Provision (benefit) for income taxes
28,894
1,208
(c)
30,102
Net income (loss)
117,451
(1,208)
116,243
Net income (loss) attributable to
noncontrolling interests
12,773
(12,773)
(d)
—
Net income (loss) attributable to Moelis
& Company
$
104,678
$
11,565
$
116,243
Weighted-average shares of Class A common
stock outstanding
Basic
65,572,013
6,203,531
(d)
71,775,544
Diluted
70,171,256
6,203,531
(d)
76,374,787
Net income (loss) attributable to holders
of shares of Class A common stock per share
Basic
$
1.60
$
1.62
Diluted
$
1.49
$
1.52
(a)
Reflects a reclassification of $9.0
million of other income to revenues related to unrealized losses
from the mark-to-market impact on shares received as partial
payment for advisory services provided on certain transactions.
(b)
Reflects a reclassification of $0.7
million of other income to compensation and benefits expense
associated with the enforcement of non-compete provisions.
(c)
An adjustment has been made to illustrate
the result as if 100% of the Firm’s income is being taxed at our
corporate effective tax rate of 20.6% for the period stated. Our
tax provision includes a tax benefit related to the settlement of
share-based awards of $9.6 million; excluding such discrete
benefit, our effective tax rate for the period presented would have
been 27.1%.
(d)
Assumes all outstanding Class A
partnership units have been exchanged into Class A common
stock.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230726293236/en/
Investor Contact: Matt Tsukroff Moelis & Company t: +
1 212 883 3800 m: +1 917 526 2340 matthew.tsukroff@moelis.com
Media Contact: Alyssa Castelli Moelis & Company t: +
1 212 883 3802 m: +1 929 969 2918 alyssa.castelli@moelis.com
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