Evercore (EVR) 21 Oct 202020 Q3 Earnings call transcript

Good morning ladies and gentlemen. Thank you for standing by. Welcome to the Evercore Third Quarter 2020 Financial Results Conference Call. [Operator Instructions] This conference call is being recorded today, Wednesday, October 21, 2020. I would now like to turn the conference call over to your host, Evercore's Head of Investor Relations, Hallie Miller. ma'am. ahead, go Please

Relations. Good for and Financial Evercore's Hallie of Call. Shannon. joining Results you us I'm Investor Head Evercore's today Third Miller, morning you, thank everyone, for Conference Thank Quarter XXXX

this This results approximately Investors be company's today John Joining me on it evercore.com. in Evercore's will on call prepared during that our our Co-Chairman call Earlier may statements, one of complementary for today remarks, today, live to Walsh, we for third Co-CEOs; archive point Bob After webcast announcing discussion the section conclusion up we call, of Weinberg, results. days, XX the the questions. Schlosstein, and hour financial a of at COVID-XX. call available course are call. and For including the CFO. number after I our beginning release to Ralph the we is this of press forward-looking website, and conference conference being our our issued that of quarter will The respect is make available to want out release, a the XXXX and is with press of which website an open

include, when these business effect materially factors actual are differ there business. morning, filings to Form risks forward-looking discussed discussed and our is those current Form will we on are our presentation pandemic we In in our outcomes to X-K, that SEC, has significant measures on Form want on to but indicated, These unless measures, statements cause reports As the which are expected pose including remind evaluating financial with not in including filed company's its posed any that make, non-GAAP limited today, to forward-looking important release statements. otherwise those our X-K. be Any in performance. duty the update XX-Q earnings for uncertainties and XX-K, could quarterly this are are you on reports challenges indicated from and discussing Form company we on to, worldwide the COVID-XX statements. the COVID-XX no that continue that meaningful to our about those report I adjusted and annual assumes subject and Evercore's factors various believe to

you For on to the reconciliations, detailed our and data our release, GAAP financial on contained should disclosures the is which measures these press posted within website. refer

believe is performance evaluate continue that an it to important Evercore's basis. on We to annual

for now by particular As transaction the call closings. influenced Ralph. over of previously, any we've quarter results are our timing I’ll noted turn the to

you believe Thank that morning good which our we the And third are same Hallie. in call conference to hard room. everyone. to earnings It's for is altogether this very not much

his offices our office in North New and is call Bob in the city. our York New today's in York John office It's in am I office For is week Salem, New our Jersey. in traders with in in and my

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want responded of our this and on year to on the brief how what we to comment update forward. provide Evercore focused events financials, I a I are Before on going has broadly

thoughtful to the As around we beginning I a globe. are and our very to implement mentioned return deliberate offices

and is is follows; being begun advise pivoting reasonable diverse the individual rather remains in clients at our local The leveraging We environment. work Most months. measured a to and on their re-engage. been than quarters of to capabilities period of protect families to them their communities to a occurring matters government financial which broad pre-downturn is needs work. our of focused the our colleagues anticipate announced any be our remain consideration return own in meet that the that paramount continue this of will and choice. for activity and and measured all back changing the we remotely economic and our in The of the has and pace guidelines result time designed employees to probably follows in M&A health safety we new addition as to of and transition Our have case

equity experienced We we Restructuring are advisory clients continuing seeing and continued clients transactions dialogue constant clients and and having our we refinancing helping opportunities. with financing privately raise future increasingly has publicly environment. are And needs. both the about in debt finally our advising months momentum engagement become and our are occurring capital for on several our their opportunity with are investors Non business business looking during seeking strong a research clients in part activity advice. and underwriting the financial distinct has of past strong and an important management including current wealth -M&A been

raise sheets. clients shore up balance to able been their investment have their and We support to capital liquidity, enhance

committed potential strongly. the we our our of continuing which strong and to maintaining Despite the in look as the and liquid in proud team. we earlier is which our stages year And continuing in alternative our a increase outlined into are to the our we which forward many product There of to we fourth be I particularly capability be XXXX strong are this remain uncertainties caps in to which backlogs during third securities XXXX We convertible an the including quarter building and look our remainder are significant XXXX seems our was to in in course quarter. forward originated we designed momentum momentum in of of origination very distribution M&A enhancing balance and to early quarter that announcements and capabilities finishing the sheet. [SPAC] and

me now with third results the and turn months our of our We're to pleased first Let results. for quite nine quarter XXXX.

March, to allowed diversity the Below spirit advisory us our deliver revenues May, team April, our of our results. entrepreneurial capabilities transactions affected As essentially in flat third year-over-year. M&A June and of that are the quarter average

quarter you XX% have compared quarter. second to in doubled In to to nearly last year's and U.S. M&A and increased compared third threefold the XX% increased versus increased as third seen volumes quarter more last M&A year's However, compared quarter quarter. the announced announced global than volumes the the third second

During each of $XXX months global announced the in average transaction two billion were of the higher quarter announced in global two of years. for years the monthly than U.S. second monthly last September the volumes the surpassed the volumes M&A and past only both third three time and

$X.XX $XXX.X the revenues underwriting versus activity. million restructuring, capital fees Third commissions as offset the M&A from revenues net related and from of advisory, flat and both year-to-date periods and were revenues quarter year largely of lower decline billion revenues adjusted prior adjusted net in

X.X% among our compared X.X% be X.X% results advisory compared fees trailing June of share fees fees advisory XX% firms at $XXX.X end quarter of end million XX-month the basis to advisory Based actual year-over-year on at Third a XX% the on of period. year all we and year-to-date consensus declined and declined $XXX.X publicly expect estimates market to to XXXX. year million and the reporting current prior of

versus million business contributed in diversification more increased million fees $XX.X continue of and period. the to prior and fees The year our in our product year-to-date has $XXX a XXX% underwriting broadening capabilities. up tripled underwriting underwriting of our the industry we invest quarter Third momentum step and than real year-over-year coverage nearly to of

sustain and meaningful IPOs, hard working follow-ons pipeline are and this the in and to diversified momentum We quarter a fourth have convertible of securities.

the subsided. Year-to-date the million year fees Third and year-over-year the XX% volatility X% first $XXX.X heightened increased prior year quarter $XX.X fees related volume the million commissions versus related and months commissions of as declined six of of of period. and

for million months. $XX.X were the year-to-date quarter for and I'm $XX.X increase million an nine for XX% and X% XX% administration fees the and nine third the quarter months management for Asset the -- X% in sorry of the and

expenses. to Turning

previous compensation. than is quarter is compensation months pointed months year nine includes market Our there revenues earnings our XX.X the adjusted prior comp which of ratio an for uncertainty of year years the the The and nine in about as it XX.X. past the XXXX out of on estimate estimate full the compensation. for first as has and we accrual however for first both year have full calls This reflects in XXXX full higher level year incentive ratio years third

million non-compensation versus quarter year-to-date $XXX.X and of declined the costs million costs Third non-compensation of XX% period. prior X% $XX declined year-over-year

X% return adjusted income and declined and of our earnings operating in XXXX. share million XX% we million a adjusted respectively $X.XX XX% EPS capital through period. $XX.X adjusted Year-to-date dividends $X.XX and strategy not income and to business declined adjusted committed which the and remain return prior operating EPS net XX% quarter We Third of our respectively to needed historical versus $XXX.X XX% repurchases. and of adjusted of XX% the million of $XX.X quarter versus million shareholders and $XXX.X declined in income net and third and income declined

plan increase Given months that [a which our view is year first board to of which quarter flow required cash of in quarter. results that resulted our Bob through the in return reassessment that $X.XX of and to in the increase generation, prior to consistent the a beginning normal returning good to begin of X% to declared in cash earnings our repurchases. we nine his the are We with a cash position from not additional a our return our to our are dividend XXXX for of April strategy solid have on $X.XX business share the provide pre-COVID detail X%] per to investors will remarks. practice restart dividend

to to over the John business talk comment market environment on like banking about Before I'd to I environment turn the further the to for and talent. our call investment current discuss

see expand senior level and building additions. talent to pipeline A capabilities plus to and to of out we further a We opportunities our build are continue geographically

business as the equities an This capabilities convertible help Mike and SMB expand to capabilities. in the quarter we firm distribution our welcome underwriting firm's to debt Myers

highly We professionals and remain from high firm. our promoting talent focused the developing also on within

in upon as are recognized showing where recent especially of ISI's investors firm in Ed for all count. the a three we was me XX of Evercore firms Survey wide you Evercore their to has a our call ISI recognition Furthermore, Evercore tied record kudos ongoing positions. turn XXXX trading so and research, the sales XX and a extraordinary he awarded we or and the Evercore Hyman year depending John. clients chairman support the team claimed entire individual economics; or how institutional for small let for to All ISI's ISI ranked and in most XX earned by institutional times. proud Research investor a over number founder that and seventh team margin their position its were positions performance. much America number two top-ranked number the annual large row to independent Finally, Thank you record With among one

stages CEO sectors, for happen readily months very of the are you the recovery there strong of I we to Thank healthy event many available several to The following After of access financing key the in appears in the conditions early that are much absent markets greater continues could a of equity the certainly credit for muted necessary activity merger Ralph. remains, which global onset as a immediately be negative believe to pandemic market continue to M&A stability and and improve. improve confidence markets. many

improving our to both serve we raises. result conditions we debt seeing clients opportunities Despite In in equity the the the sectors especially those elevated globally. activity industry are credit expect help the and rapid swift stay sectors across government opportunities are onset multiple stimulus our we clients of capital across these a and as As multiple to found the advise increased high have that to remains in at leverage distressed. pandemic all refinancing of restructuring markets financing, and recovery

in most to busy assignments transactions assignments sponsors for are hit work and again have hard and as increased capital clients sectors beginning re-emerge Private pandemic. advise remains well. group and Our restructuring to activism through the by continues

not While and during the levels back pace research quarter clients financial remain and institutional to activity. wealth management continue to advice. yet are and management encouraged we markets the we clients we are insights focused on pre-COVID our valuable provide both evolving to the current of wealth Returning by investor

as We volatility teams as raising stepped year has not first continue this and months about we third that the of am into our market the up advisory been expect months. high the the our as six the activity pleased performance particularly of focus in have I with as and over year restructuring however overall subsided. I'm trajectory quarter the end. has Creating to debt these optimistic capital merger and head

Let many now with investment sponsors our activity to banking. to both clients levels and in turn sectors. increasing platform me in performance I'm financial encouraged across corporate broadly see our

M&A our U.S. among over for announced over volume number last ranking increased independent the volume during firms. transactions months all the Among in and league table we number last we M&A announced U.S. both quarter globally announced the sustained the months. XX activity were again once As the firms one of in four in XX

our I debt busy. restructuring advisory said teams As and remain

clients and in expect bankruptcies in do more continues has believe restructuring been advisory activism further There with origination is will liabilities expertise are to job Our completed be what opportunities U.S. we a pleased year-to-date transactions and which involved and nine hostile of activity pickup restructuring has of moment. leveraging industry-focused to our partnering cycle. year-to-date. largest advise group unsolicited throughout the shareholder at and be the up total a financial pick bankers. the there has all an to situation Corelogic In the XXXX is businesses advisory already by We of to defense we and to great our be capital than biggest advisor been team XX our to elongated The momentum. beginning the private in activity

in clients virtual entirely fundraisers been has the relationship both and clients environment leader a new existing funds private where adapted successfully developed has been the has environments. for space to Our in virtual remote the group successfully and completing

markets capital business well. equity extremely Our performing is

in continue we underwriting played and building our the role nine or in XX book on co-manager served gain runner we in on team. We our and maintaining six quarter We transactions of XXXX XX an as to first a the are alone. momentum largest focus of months the IPOs key U.S. active third

opportunistically part Evercore the U.S. offering We book mandate are sole brings corporations caps with caps are breadth Clients the have developed on conversations served we executive and technology network This the first and capital unique activity and market. range increasingly across book broad we to here the ever run to IPO. and look pleased and healthcare, million continue popular energy. to very XXX as pioneered, proud runner a structured sectors at of are raise of innovation experiencing to partnering was SPAC’s including our financials,

important origination strategic continue the broadening team in convertible the with also We to business out and building hires. invest

continue Although as quarter. execute our markets. have for million we help equities during book for in insights investor In valuable the served offering corporate Group's our macro it us early and an days fundamental rely runner active Helix continue is Solution business, bond the volatile traders convertible us space on our and to Energy in and clients clients convertible still to for our $XXX

mentioned institutional very Ralph of As team's the investor are proud earlier we results.

to physically balance Our results team I like our encouraged would that over matter in can we being of despite offices. very outcomes the not this and our in am quarter I call demonstrate by no activity what breadth pace Thanks capabilities momentum and our experiencing platform the now produce the to turn environment. current strong the business. Bob. our much the are the of together to our of

Thank you, John.

on with GAAP few a results. begin me Let our comments

For $X.XX on were per share quarter $XX.X the $XXX.X income third respectively. XXXX net revenues, net a and GAAP earnings million, basis of and million

For net the on million were basis $X.XX a per revenues, $X.X net $XXX.X GAAP XXXX and first nine months respectively. earnings income share billion, of and

certain separation realignment adjusted we of prior fourth we XXXX. working in exclude to all communications remain are of strategy Our related the quarter the the we to modest that and reflect transition of estimate. began increase results are related required to that by and a incur approximately its which strategy the items $XX execution this are year-end. and benefits finalizing associated cost costs million juncture Ultimately, realignment with hard At for and our complete in expect the

Year-to-date to $XX.X excluded $X.X special special initiative. from third are we related the adjusted of During charges our as charges recorded results. realignment recorded we million the million quarter of which XXXX have

there, in business of Mexico this management subject mentioned which the that earlier and principally submitted of to have in June is an purchase entered we is approval year occur regulatory this sale after shortly expected into was we is Completion to investment broker-dealer to our provides our approval As which leaders with services. agreement received.

business addition, new the Evercore form a we diverse strategic our will they strategic Mexico this array in alliance in capabilities. from believe and needs We best departing model leaders team advisory that announced to of partner this address month under and positions to new are build In a a Tactive alliance. which with growing advisory earlier Mexico firm client

in million results charges exclude $X.X and depreciation Our adjusted to and first quarter XXXX months special nine also the of expense. million $X.X related of respectively accelerated third

to our deferred a under compared million portfolio revenues compensation the million versus primarily quarter in result of months Turning investment for an is of third $X as of approximately gain portion year the for hedge increased of on reflecting revenues compared to the a to other nine Other a this the revenues, against primarily period of $X prior the XXXX $X.X as year used period which other program. nine first a net gain first of funds XXXX. portfolio from prior the million decreased months economic

Of market quarter amount and the the this fluctuates this quarter's during of move course continued as market values drove the strength gains.

firm costs, versus in a per The on the lower non-compensation non-compensation down lower XX% costs for non-compensation primarily employee decrease costs $XX,XXX last reflects on year-over-year wide costs professional and year quarter, fees. per approximated Focusing and employee basis. related travel

begin more with to As towards and travel, other expenses will professional normal fees associated we to evolve some continue costs recur. operation

for shares the quarter. for to XX.X million third a On XX.X% tax GAAP GAAP basis year period. XX% the our third rate count the for was share prior quarter Our compared was

comparison million cash or our liquid we XXXX XX, $XXX held XX.X for and of equivalents was securities count financial of assets. million equivalents $X.X approximately of approximately September held $X.X or investment investment share then cash looking $XXX September position $XXX of XX, as By cash earnings Our billion million XXXX. we adjusted $XXX of at securities share and million and Wrapping cash liquid shares. of at assets and of million at million per up

and satisfy As our both of liquid maximize At highly we cash compensation to shifted We have to operations and past, in fund our outset we the portfolio to holdings base portion generated longer-term the plan as equivalents. securities deferred investment of to our the flexibility. discussed and financial cash shifting a and begin that for our buybacks deferred This hold to held we capital investment expenditures reducing securities downturn result will as to obligations. a in investment portfolio return. so compensation relative re-establish permanent a to funds our obligations funds cash our strategy investment well to greater

cash begin regularly to other as and We our our continue deferred contractual to liquidity, requirements, we monitor compensation support obligations covenants to to will earnings levels, not Ralph investors. capital including needs noted regulatory needed and return cash these our debt

to the turn me Let call John. back

Bob. you, Thank

a Just before we go questions. of to couple comments

people to result dedication, I pace current First just team. our and Bob results I activity teamwork, of The a exceptional summarized direct acknowledge experiencing, moment of want to take we our the collaboration for and in are Ralph, our the you on to challenging our their that firm clients our our efforts entire year. for throughout commitment to during have clients sustained this team behalf and a demonstrated period. our Thank keeping of

our our during Second, inclusion Evercore. call diversity a inclusion core pursuing that we share and committed value. to we last during quarter at talked remain and importance about and I'm standalone as diversity to of proud the added goals the diversity We inclusion and

committed this individuals to area we both progress. as look make accountable to and and important in ourselves are forward continuing holding firm to We a as

a we in the the much conducted office, preparing strongly with hall Finally, we employees on for virtual socially as our and focused that shared Ralph distanced and while XXXX. recent year all very during town I finishing are

help there been regardless our about we never are optimistic ahead still diversity While breadth clients more to our have uncertainties environment. of of the platform and the strength,

like I'd to Now questions. to ask invite you

sir. Thank you

begin with We Our line the is Stanley. first Morgan will Gosalia [Operator question Instructions] now Manan question-and-answer of from the session.

morning. Hi, good

often extent we're that industry it's available least I we've publicly to advising deals said maybe realized with a the been not the industry only sort seeing updated whole but of you same well we've as based for that which on on as in and data for perfect very lag. the at that public and isn't seen As Evercore an has uptake M&A pretty seen rebound strong the announcements and in a on what's

as see make full see have the into bit So the that now about completions seeing we environment quarter XXXX competitive you here address pipeline as of talk that the the rebound we activity. we takeaway this in the in you're can but very fourth based a wanted and on I right you can't little nice go that we yet given right to a is what and picture maybe just sure flurry should

Sure. We feel pipeline. very good our about

solid our We our is strong have up feel our have business like in dramatically. we stand. real feel solid, we are dialogues and and momentum backlog and we picked We quite good where about

Our dialogues are good.

very-very-very some doing good have and continue clients very have We looking dialogues definitely to strong relationships that our are things. at

good feel is always rigorous. And position quite we there who people so the out in merger There quite competitively are things. market doing about are environment our business and the as

I willing is are dialogue to generation to one going businesses clients bring There much of on. opportunities is very a in the lot that their think more are interesting idea engage forward. looking now. things for Clients

with the we of activity situations and the dialogue just pace our environment find, clients. to pace the really continues to going clients like of see the is to us that pick give for continues and feel opportunities we So it to continue up really good if

look believe and we've new of whole challenges dimension ahead at capabilities be given to even really has that as We the we us they clients we more serve can and our our of breadth ways beyond in have so important we opportunities to our both them. also M&A a as that clients of said

the and you taxes are clients agreeing with can on see you being are little to having happens on seeing possibility impact the the to mean increase more Great. how through Thank are electivity? Are close? elections more taxes? preparing bit waiting deals a before before pushed about clients talk in you. for the end price an I what of a your or deciding And

the in deal certainly overall held year The is material of elections but haven't an on people's there it's environment. before way the for minds effect other to really Yes. any lot affected of than a a handful really except a companies activity privately having one been transact in while has the of desire on end they're much not that M&A which

Thanks much. Great. very

the Ryan JMP Our comes with from Securities. next of question Devin line

Devin. Hi

seeing on a word person to the thought that that's word follow are is great getting unseen there they the we momentum just time get held still, still that's questioning people shift deals of Hey trying and there everything that want in being not been the and a and which willing still just I one and travel morning. fact understanding of certain meeting first better I've to so but is are strong travel filling number heard and is a on activity the in I'm over just area think still to I John. back of about still restricted you're activity of on some there up about so know is in backlogs business, and there up that very in are there. and when as now and restrictions purposeful Hi a last important as are while because backlog that sight the we've things good always just forward whether just whether because deals moving are people buy the is can't you normally so to active just are aren't just think a people now to M&A virtual assets are or I'm trying line to

in XX last definitely done interest discussions. meetings a transactions transactions outside. is we're seen his have in as been of we've the are people been for well. in face-to-face still and probably an occurred from distancing masks but there also that and pickup said [garden] but obvious activity There the and in years with strategic a than numbers larger quarter done exclusively demonstrable activity. even seeing at numbers there remotely this John have that's in pickup transactions Those that beginning want more bit as the remarks in to has third a that from have interact in safe been a and have the quarter way or They're Well, inorganic social in real primarily and

place I with accomplish and been dialogues thing that the believe I'm element transactions back that also call said obviously. that where as very we that they much what is face-to-face deals all to of and believe of and going maybe an I so would equivalent almost behavioral comfort just of is mode a to much and communication The taken there clients think with that sure believe communication have that the increasing of way feel that in an comfort can effectively Ralph through there actually and you go We there really mode in in is all and transacting. people really and same change. Zoom but office add that has to as or We mode maybe are medium the face-to-face that seeing

the Thanks up Terrific. ratio. to for compensation then And the on follow just color.

kind XXX implications year uncertain this for points go appreciate there really Your if in and year-to-date the about that throughout you the and through more mean comp the continues in still about thinking revenue normalized are year-to-date M&A flat. on The comp are ratio and revenues talent level that backdrop I then quarters, level here. at and the been first last the fact roughly year is for what basis above has we're a year's is momentum with quite maybe just environment versus you is implications of is environment mix especially I'm conservative year-to-date a are on the a are thinking of uncertain of uncertainty three year-to-date as competitive ratio I'm higher about versus forward about where but being view that trying implications about also any whether the the we think whether kind more revenues to

Yes.

it think of factors. has all I those

certainly normal independent flattened in the that of years; first and revenue. essentially than ups pointed And terms tied following the we comp to will two, who uncertainty months anything of number is you revenues. question what as to compensation We what not large in as team one. fact in of we our very of little in will with this fourth as affects first what is years. downs final idea Number we not, do the three are that senior remarks at quarter to are of we correctly have opening will out managing competitors have bring from were respect our do asked greater We year I end my did quarters year the the notwithstanding that the the under nine directors, next that of comp course majority ratio not you be year are the would or imply more whose and and and

in a unusual billion great of revenue toward a XXXX again that's It's like one, obviously normalized we're we're normalized and and to seem things. unique heading couple this of could be we we the environments year more we a over is XXXX to which be team at beginning moment a $X look and this said on Number focused we in returning team. of calls, environment. certainly think and produced but as on have just earlier derailed a I more

a had we XX. produce ‘XX it In comp And what comp like that be and we again next will year so our that there we'll obviously to below and is then XX.X do when we'll estimate can't very of had ‘XX we full to of for XXXX. ratio get reason year the no best in we ratio a results

you Co-Chair firm three account been reasonably two year that think less the future start senior income through addition years. which but has talent this flowing and last been years investments to the those Co-CEO the statement become of to in are they years and some a have last investment and take significantly of people impactful very year phenomenal including heavy or and I should also into my

as So beyond. I XXXX, anything from any where XXXX having for deduce months or for all are implications at nine wouldn't we

terrific. That's colors was you. That for. was Okay. Thank I looking the

Sachs. the Goldman Richard with is line from Our Ramsden of question next

I the a of I pandemic your guys. we kind are bit thought is when Hi, talk liquidity can you post guess good hitting. What little this restructuring about the see guess I going to months cycle? this from business. the restructuring a And there the process of thought key Perhaps impact been of debate question recognition broad restructuring cycle, to do availability six restructuring know your over really How expect peak business? how the revenue process? morning is is around is lot

Ralph terms restructuring to real both activity we our of as well. performing and said and business see extremely our is I Well, group continue in

even our helping going number to is restructurings there dialogue gets fact involved many-many to of amount involved activity more group. coursing clients clients, a advice are give and of any and in that in We in and restructuring such corporate group that tremendous through

companies terms elongating some really might in that been of liquidity that able is liquidity in the and not that had enough have distress. complete the means cycle liquidity lot such get they're of clearly actually to have restructuring In struggled in system in financing the glean there of system and that that is the the to a

elongating. So it's

what continues dialogues anticipate and productivity very of top us. be quarters. we're cycle would is I continue activity and but level terms of for of hard that the over really we We In clients very, in next with say the calling to will like good that's feel high to the level do the our very multiples activity

perhaps the mean can then the it's like this ECM about realistic $XXX let's that medium for you a Can revenue over Okay. if year. for for share years talk on of is well a Great. business. you track business feasible think little say you I bit looks within that the And little you and business million market fees about term what think talk to about bit five do three a make ECM trajectory that you? to or

that of and and we figured bankers. do Blair forward big function on million a with transaction this that. three like we felt million the that step based ago I be build said could it and time, ISI happened probably year we million six looking it Stifle I consequential firms doing I million I we would is achieved at that to would $XXX firm. was articulated for year million the to to reasons for $XX number years did say of when $XX I I level $XXX underwriting at that most that $XXX reasons was some our they consequence doing Well, We what's for the all were thought last would did and business so million quality $XX we could million and $XX have an and there cautious that a the are

although First percentages not triple been think it's firms. of has all had been ECM I Obviously firm digit all we've across for board, of increases. has as seen no that up you've activity had double-digit certainly up the the experience

things who on March, focused activity pause essentially June, balance sheets sheets disposition of incredibly were them bankers not heavily relationships next splitting and discussions happened. to So were clients a I going liquidity, period talk M&A on this our couple very One, equitizing balance their are merger out strong figured to in firm. talented, the entrepreneurial or the restoring and time about of July April, their May, or put clients very was think were have and have period their that the over

strong the and we've And practice. amount so and produced industry with year had our this broader healthcare a a good engaged they Obviously, much so of very of the in characteristic a biotech clients really one, respects; two fair past business number underwriting underwriting business is in and diversification.

revenues last thing that year-to-date underwriting ahead but revenues of are have both already year, on We underwriting this total for again our healthcare our revenues. the and is our non-healthcare all that interesting year

underwriting in or diversification step underwriting $X a would change never obviously of run and forward-looking pickup be revenues. function million underwriting So revenue. also Obviously, XXXX make in we equity the underwriting Devin's $X.XX any did always what rate in underwriting of made a the environment revenue. attached I did there comes should rate revenues question, beyond worth of significant pretty asked guidance and say which billion underwriting year. what the there I and remarks equity earlier $X.XX statements our of hopefully We back $XX In level for did are we is million of our function the and if I firm it pass to to today is XXXX in be and our a with were step the in If markets of we're going the in but certainly a what to significant. I in just equity you opportunities in that billion the of where aspiration, if M&A asked, year the should overall revenue we business, billion it's that I'm of this the more are described change response headed revenues that $XX normalized confident run pretty to

Thank you very Okay. much.

with Jeff Piper Our of next question is from Sandler. the Harte line

I'm quarter mix? from that morning as And derive guys. to of another strength? this more feel of data. the get any Can the you expectations with versus really saying what's visible I'm we to beat just on Good give kind us generally contributing that meaningful a color revenue to fee trying better from kind transaction is advisory a

some some they of we that not in restructuring. not In many our assignments a had a general Well, as capital more and is M&A to in advisory. as restructuring earnings like cases, going than of weaker release this a and uncommon They had we one They matter so had there our M&A. are and work. advisory information is is financing reason comments We're hedging have even year all fact involve the type markets largest said little that and advisory. any that at had little It's fees John's stronger. advisory provide this

fee, those not an and disaggregate individual and it's we're so doesn't sense it hide just that it's so suggesting. in it's the answer into buckets would parse difficult and to just just to won't is the So try fit because very make trying them that way anything you're that to we

Okay.

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healthy. Sympathize. I that's sympathize

enough I to revenues quickly advisory a And of from what guess actually because pocket be should low air completed come M&A upward point be advisory mean M&A coming for about or related there industry potential it an pocket surprisingly and I'm and I the picking thinking announcements here? that down going XX% is on point could air up is the start more could strong, asking just a we the

other that there would sitting in at that nothing of case. on that. I think but it's we've myriad that I to various is look we discussions that in the We said Brexit would can our or quarter or third suggest the things sitting the revenues. a likely be things anything see market said of that will we've happen today a is third expected that quarter to and from and quarter forums as XXXX today, nadir not cause the whether be weakest so earlier would here in said the change top-line lot of we to here John don't that made about terms there volatility But a that be comments the perspective election or the view certainly

I'm of of up yet nicely any that it the I'm you is here is but looking that all at the kind there about activity there the answer to of think help at non-comp starting going coming down get are of just could how in saw kind what to outlook XQ know pick quarter-over-quarter. you guys and much can us we there? And an outlook don't Okay. I levels be? still from up quickly idea and up? kind Did pick of How could non-GAAP pick perspective

that? Bob, you want to to answer

Yes.

For sure.

bankers are some board a with talent accomplishing think that as of very and are there for could virtually on then is and of what that professional said and sort our market lot that talent an travel One an be uptick will extent on the building number two said return. but drive turning. bringing active awful to John associated of Ralph going I there fees there to drivers is really

too. Okay. Well, XQ Is it you cite I've pull there, forward closings Bob the was you any? cite there guys from got did you if can revenue or

million. $XX About

Okay. Thank you.

with the UBS. Our next Hawken question line is of Brennan from

Good morning. Thanks my taking for question.

you've on that So comments of the earlier made here investments. a the question on some

up years, guys recent despite restructuring. advisory from SMB that's the You headcount an actually have

kind you're still ramp these color what stage Thanks. are on What what that of many new front? of hear of trends productivity. SMBs brought seeing them and in? in on you interested the helpful. you and kind surface be kind below seeing to provide you that can are So the of How That'd

growing really, external at is The had and and Look and ones XXXX directors of in that's that ramping. business the and Internally talent best roughly externally, two they're building XXXX, externally. of we're be joined have equally split advisory our forms internal. The we managing about senior of you much hopefully they The people assume ramping hire year tend a ones very each there XX% to internal little normal have it. any productivity. full XX us are exceptions although them, first year cloud or the the look younger assumption in so we are to their first a this sector we promoted a revenue and best between is and have year if XX% all two, productivity we in external year of is pretty assumption their they're and second our doesn't our normal long full to over productivity year full second as in that as

their because XXXX revenue cruise have what hired was XXXX in full XXXX would COVID. for first with year in line banker had example full hit not of So a and they happened we

second but four ramped year this SMBs generally full year eight by -- those the to we to and So had externally. hire absent we've tend they a be things

range year end really pure We will that be probably toward the this two advisories. only and lower in or one of

than were in SMBs XX ‘XX. So in and there ramping ‘XX than they're fewer XXXX or there more there were ramp they're [fewer] in

productivity So I to think and that in return see provides would environments levels. our some normal to hope ‘XX, opportunity us M&A for we ‘XX, ‘XX

a it we're as of just first that of environment have people you into that we're said equity that makes slow, very how of and going so we've the a that which trend from and just productivity upward. to in the so what of you've to and good continue couple I help is revenues that have seen group substance is lot our second people are because environment equities and in invested of things the productivity will the to see business, that emphasize productive go add, makes Ralph area to to so it the been you've in think forward and hiring I capital actually that we is and quarters as the and it play the and going markets we've the itself you'll bit which group very just continues on I grow we've like that say I have seen these as think we difficult the a more people brought an thing and I will sum we environment difficult improve, would I out very-very in like to the couple as see a to seen that hopefully feel about and fact think be sectors really ramping measuring last been quite all and

is Thanks fair environment Certainly to that. a an Great. very point. unusual which for ramp

together? seasonality it mentioned quarter more particularly SMD be two How seasonal before strength given comments the don't this also well things me. XQ but about so fact could seasonality? your end been activity, flagged you just many to done that are we I on we've come as really should we, give interesting has the you Is that not it You hear if then or was and how for being think going pickup end. to think the deals strange year So typical that for of about getting a election should tax reasons some strange does a smaller about for some How One, all inactivity? should think levels. source count impacting year we seen

which the into never quarter touch that you Bob we is the nature. question of end or about that anything part revenues a which the third count Well, let into give quarter but of I'll the, would the fall next statements second SMD your falls rail

-- I think though

inside good. Oh All come on Ralph, the on that. corner I painted

we're possibly I quarter things you that the third will the statements will the much quarter ever change be if think we as lowest don't as we earlier year give you. the that that should give made of confident

is So Brennan XXX. there

you. Thank

Our Steven Wolfe from comes Research. of next line the question Chubak with

open. Your is line

Hey, good morning.

of some the of commentary. a comp So I've had follow-ups on lot

back the just and outcome? back just feels $X shock XXXX return revenue and on a wanted get So ratio, reasonably that actions sub-XX% reductions should you restructuring $X to ratio billion cited level see comp macro barring ask positive assuming momentum like plus a we a given can comp negative that given to maybe and in bogey more we the just the that can the some it underwrite assuming a year, to the that and revenues question pointed did backlog, to of in late get headcount billion last we really

the to think in our be but to we're objective. have discussion XXXX is that when that you with we'll answer prepared I certainly that is that

Okay.

preclude mean, I would Okay. guess you I from what outcome? achieving that

Lower revenues, lower productivity.

Yes. Right.

some With to reconcile revenue billion We to guess rate others this challenging. run add the year start can year's is to a we reasonable is because back I'm the in of revenue underwrite? You that have that we benefits see If assumption actions. we that not accrual comp next are lot taken of with is struggling the what this backdrop get revenues in ‘XX/’XX, I could those one actions, trajectory high. but $X plus the wondering seeing recognize a expense just the ratio can those I'm guys and year for come I a restructuring that comp issue comp underpinnings line through?

Okay.

run a like Let same increase make sub-XX% we're these ratio we years can we question the and ago, history the mid-XXs sort a XX% A firm it talents answered because like years and value that said of of very We this other something ratio calls and two out progress an help we and asked hire that and in little time XX% XX. see said and bit. you have it at joined of that. that we believe never margins three had comp said that When ratio we there also the I XX in can XX% we in make the with will do high if back that margins was business words are given XX, ramp we'll to of of Roger and and XX, that going if And in comp to in and would XX, a what let XX.X year a to were period that said go the we XX, it I XX, comp about course we any number in that. way on steady is this know you a or I or we opportunity we'll we get plus of that because disproportionate me towards

a we're able precise be. revenues what don't regard with that we're John so don't certainly John time can been be challenging the and to articulate should and with joined statements and ever know when and this because we that. a going And still thing happen then opportunities to arrive know and going as and don't We back changed are subsequently firm to Roger those. that very going I would years to we all made has obviously want investment be place reasons The of only I I but what know I the nothing to that what kinds to has market endorsed is say a ago, arrive comps year since comfortable have going think we're four for have we not that to

of uncertainty there lot still Thanks context that Great. Recognizing for additional lingering. is a Ralph.

other some specific of product to certainly this Curious it seems what's SPAC been early differentiated what value that the just One of from to corporates about SPAC surge feedback wanted is that the seen now. we've has the prop comments timely questions obviously volumes, of launching ask alternative the relating and I this in of on offering? you're a some maybe

transaction there sufficient be the and Look, the been a quite SPACs equity are that between predicated Okay. tied the to there SPAC. the oriented goes is sponsor of sponsor doing to understatement the a has returns on to big the that amount which different the underwrite primarily alignment sponsor to for a is we've deal SPAC wasn't done to incentives that more is are there from just is in investors private that reluctance point dilution incentives investor. where reluctance the had view an traditional historically that when a I think would And for the the obviously returns the the of

second the the which aligns the to the interest we'll the that. does and of done So one be we first degree created that [caps] and doing a we've one much sponsor and investors equity the negotiated occurs the down shortly merger in having lot have when, market while said a It and the it is our and that capital greater product we the evolving the those the a get outstanding now. or says the when SPACs also of XX% world sponsor company of of document in legal that get can

not merger it there a taking introducing virtue the become discussions of So is a a alignment company public more to but markets XX by of ultimately legitimate merger quite of virtue X public. the the last into discussions SPAC way the taking in the months has by into underwriting by and of merger and

and so with we're a that very active merger finding increasingly we've of and with consideration becoming legitimate includes both a of representing companies a the So as our more SPACs to is private and alternatives business. are a we're company into obviously, acquirers common and clients of a, SPAC private that capitalize being capitalization or the market regular the been in IPO listing, sale the or value merged it's way SPAC direct SPAC way certainly merger sold this

add clearly Just lot our we've as be we of are and to part business SPAC sponsors caps participating and have expert at SPACs that looking we're we to the beyond talking itself other SPAC a we're that Ralph evaluating to been involved to market lot underline where involvement. in a and in important build said transaction the of of of We things an Gap] market and and but middle like couple value product an also market more generally our the our very so expertise and in in into advisory momentum SPACs. whether equities [Audio advisor we a we our can places certainly it's SPACs the

Great, you. color my both so by of questions. Thanks much very for helpful taking

Sure.

XXXX There financial appear quarter Evercore concludes to today's third This time. results this be no at conference call. questions

disconnect. now may You