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| Share Name | Share Symbol | Market | Type |
|---|---|---|---|
| Evercore Inc | NYSE:EVR | NYSE | Common Stock |
| Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|
| 3.26 | 1.17% | 282.60 | 283.35 | 280.27 | 281.73 | 222,201 | 01:00:00 |
From Oct 2024 to Jan 2025
Evercore Inc. (NYSE: EVR):
Third Quarter Results
Year to Date Results
U.S. GAAP
Adjusted
U.S. GAAP
Adjusted
Q3 2024
Q3 2023
Q3 2024
Q3 2023
YTD 2024
YTD 2023
YTD 2024
YTD 2023
Net Revenues ($ mm)
$
734.2
$
570.2
$
739.5
$
576.1
$
2,004.3
$
1,641.8
$
2,022.1
$
1,659.0
Operating Income ($ mm)
$
122.0
$
76.8
$
134.6
$
82.7
$
314.4
$
241.4
$
339.5
$
261.6
Net Income Attributable to Evercore Inc. ($ mm)
$
78.4
$
52.1
$
90.9
$
55.5
$
237.8
$
172.7
$
262.5
$
189.1
Diluted Earnings Per Share
$
1.86
$
1.30
$
2.04
$
1.30
$
5.76
$
4.33
$
5.98
$
4.43
Compensation Ratio
66.5
%
68.7
%
66.0
%
68.0
%
66.6
%
66.8
%
66.0
%
66.1
%
Operating Margin
16.6
%
13.5
%
18.2
%
14.4
%
15.7
%
14.7
%
16.8
%
15.8
%
Business and Financial
Highlights
◼Third Quarter and Year-to-Date Net Revenues were $734.2 million and $2.0 billion, respectively, on a U.S. GAAP basis and $739.5 million and $2.0 billion, respectively, on an Adjusted basis. Third Quarter and Year-to-Date Net Revenues increased 29% and 22%, respectively, on a U.S. GAAP basis and 28% and 22%, respectively, on an Adjusted basis versus 2023
◼
Third Quarter Operating Income of $122.0 million and $134.6 million on a U.S. GAAP and an Adjusted basis, respectively, increased 59% and 63%, respectively versus 2023; Third Quarter Operating Margins of 16.6% and 18.2% on a U.S. GAAP basis and an Adjusted basis, respectively, increased 314 and 385 basis points, respectively, versus 2023
◼
In Advisory, Evercore advised on some notable and complex transactions representative of areas in which we have been investing, including financial services, energy transition and sponsors. The transactions include:
◼
TIH on the $7.8 billion sale of its retail insurance broking division, McGriff Insurance Services, to Marsh McLennan
◼
Avenue Capital Group and Nuveen Asset Management on their $3.4 billion sale of minority equity interest in Vistra Vision to Vistra Corp
◼
CVC on its acquisition of a significant ownership position in Epicor, from Clayton, Dubilier & Rice
◼
In Equity Capital Markets, Evercore was lead-left bookrunner on Diamondback Energy’s $2.6 billion follow-on offering, and year-to-date, Evercore has participated as a bookrunner on 5 of the 8 Tech IPOs in the U.S.
◼
Evercore Wealth Management was again named to the Barron’s annual ranking of the Top 100 Independent U.S. Registered Investment Advisors for 2024 as well as ranked among the leading Registered Investment Advisors for 2024 by Financial Advisor
Talent
◼
Two Investment Banking Senior Managing Directors and one Senior Advisor joined Evercore in September; Andrea Bozzi, Charles Andrez and Charles-Henri Filippi, in our Paris office
◼
In addition, three Investment Banking Senior Managing Directors have committed, since our last earnings call, to join Evercore focusing on structured finance, financial institutions and sponsors
◼
One Equities Senior Managing Director joined Evercore in the third quarter; Adam Frisch, to lead research coverage of the financial technology and IT services sectors
Capital Return
◼
Quarterly dividend of $0.80 per share
◼
Returned $528.8 million to shareholders during the first nine months of 2024 through dividends and repurchases of 2.2 million shares at an average price of $189.69
Evercore Inc. (NYSE: EVR) today announced its results for the third quarter ended September 30, 2024.
LEADERSHIP COMMENTARY
John S. Weinberg, Chairman and Chief Executive Officer, "We believe we are in the midst of a gradual recovery, with strong activity levels across nearly all of our businesses, and that Evercore is positioned for success as the market continues to improve."
Roger C. Altman, Founder and Senior Chairman, "Our continued, aggressive investments in both talent and in broadening our platform are bearing fruit."
Evercore's quarterly results may fluctuate significantly due to the timing and amount of transaction fees earned, 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.
Business Segments:
Evercore's business results are categorized into two segments: Investment Banking & Equities and Investment Management. Investment Banking & Equities includes providing advice to clients on mergers, acquisitions, divestitures and other strategic corporate transactions, as well as services related to securities underwriting, private placement services and commissions for agency-based equity trading services and equity research. Investment Management includes Wealth Management and interests in private equity funds which are not managed by the Company, as well as advising third-party investors through affiliates. See pages A-2 to A-8 for further information and reconciliations of these segment results to our U.S. GAAP consolidated results.
Non-GAAP Measures:
Throughout this release certain information is presented on an adjusted basis, which is a non-GAAP measure. Adjusted results begin with information prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"), and then those results are adjusted to exclude certain items and reflect the conversion of certain Evercore LP Units into Class A shares. Evercore believes that the disclosed adjusted measures and any adjustments thereto, when presented in conjunction with comparable U.S. GAAP measures, are useful to investors to compare Evercore's results across several periods and facilitate an understanding of Evercore's operating results. Evercore uses these measures to evaluate its operating performance, as well as the performance of individual employees. These measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with U.S. GAAP.
In the third quarter of 2024, the Company sold its remaining ownership interest in ABS. The gain on the sale has been excluded from Adjusted Net Revenues.
In the third quarter of 2024, the Company agreed to the redemption of its interest in Luminis, such that it will no longer have an equity interest in Luminis following the redemption. The Company will receive no consideration in respect of the redemption. As a result, the Company incurred a loss in the third quarter of 2024 associated with the write-off of the remaining carrying value of its investment, included within Special Charges, Including Business Realignment Costs, as well as the release of cumulative foreign exchange losses, included within Other Revenue, net. These charges have been excluded from Adjusted Net Income Attributable to Evercore Inc.
Evercore's Adjusted Diluted Shares Outstanding for the three and nine months ended September 30, 2024 were higher than U.S. GAAP as a result of the inclusion of certain Evercore LP Units and Unvested Restricted Stock Units.
Further details of these adjustments, as well as an explanation of similar amounts for the three and nine months ended September 30, 2023 are included in pages A-2 to A-8.
Selected Financial Data – U.S. GAAP Results
The following is a discussion of Evercore's consolidated results on a U.S. GAAP basis. See pages A-5 to A-7 for our business segment results.
Net Revenues
U.S. GAAP
Three Months Ended
Nine Months Ended
September 30,
2024
September 30,
2023
%
Change
September 30,
2024
September 30,
2023
%
Change
(dollars in thousands)
Investment Banking & Equities:
Advisory Fees
$
592,980
$
467,401
27
%
$
1,591,049
$
1,304,519
22
%
Underwriting Fees
44,132
30,814
43
%
130,666
91,897
42
%
Commissions and Related Revenue
54,559
48,697
12
%
155,996
146,810
6
%
Investment Management:
Asset Management and Administration Fees
20,555
17,304
19
%
58,454
49,837
17
%
Other Revenue, net
21,996
6,004
266
%
68,096
48,719
40
%
Net Revenues
$
734,222
$
570,220
29
%
$
2,004,261
$
1,641,782
22
%
Three Months Ended
Nine Months Ended
September 30,
2024
September 30,
2023
%
Change
September 30,
2024
September 30,
2023
%
Change
Total Number of Fees from Advisory and Underwriting Client Transactions(1)
259
225
15
%
544
484
12
%
Total Number of Fees of at Least $1 million from Advisory and Underwriting Client Transactions(1)
112
86
30
%
298
241
24
%
Total Number of Underwriting Transactions(1)
17
11
55
%
53
40
33
%
Total Number of Underwriting Transactions as a Bookrunner(1)
15
10
50
%
45
36
25
%
1. Includes Equity and Debt Underwriting Transactions.
As of September 30,
2024
2023
%
Change
Assets Under Management ($ mm)(1)
$
13,887
$
11,273
23
%
1. Assets Under Management reflect end of period amounts from our consolidated Wealth Management business.
Advisory Fees – Third quarter Advisory Fees increased $125.6 million, or 27%, year-over-year, and year-to-date Advisory Fees increased $286.5 million, or 22%, year-over-year, reflecting an increase in revenue earned from large transactions and an increase in the number of advisory fees earned during 2024.
Underwriting Fees – Third quarter Underwriting Fees increased $13.3 million, or 43%, year-over-year, and year-to-date Underwriting Fees increased $38.8 million, or 42%, year-over-year, reflecting an increase in the number of transactions we participated in during 2024.
Commissions and Related Revenue – Third quarter Commissions and Related Revenue increased $5.9 million, or 12%, year-over-year, and year-to-date Commissions and Related Revenue increased $9.2 million, or 6%, year-over-year, primarily reflecting higher trading commissions and subscription fees.
Asset Management and Administration Fees – Third quarter Asset Management and Administration Fees increased $3.3 million, or 19%, year-over-year, and year-to-date Asset Management and Administration Fees increased $8.6 million, or 17%, year-over-year, driven by an increase in fees from Wealth Management clients, as associated AUM increased 23%, primarily from market appreciation.
Other Revenue – Third quarter Other Revenue, net, increased $16.0 million, or 266%, year-over-year, and year-to-date Other Revenue, net, increased $19.4 million, or 40%, year-over-year, primarily reflecting higher performance of our investment funds portfolio, as well as higher interest income. The investment funds portfolio is used as an economic hedge against our deferred cash compensation program.
Expenses
U.S. GAAP
Three Months Ended
Nine Months Ended
September 30,
2024
September 30,
2023
%
Change
September 30,
2024
September 30,
2023
%
Change
(dollars in thousands)
Employee Compensation and Benefits
$
488,010
$
391,730
25
%
$
1,334,650
$
1,096,976
22
%
Compensation Ratio
66.5
%
68.7
%
66.6
%
66.8
%
Non-Compensation Costs
$
116,914
$
101,664
15
%
$
347,950
$
300,439
16
%
Non-Compensation Ratio
15.9
%
17.8
%
17.4
%
18.3
%
Special Charges, Including Business Realignment Costs
$
7,305
$
—
NM
$
7,305
$
2,921
150
%
Employee Compensation and Benefits – Third quarter Employee Compensation and Benefits increased $96.3 million, or 25%, year-over-year, reflecting a compensation ratio of 66.5% for the third quarter of 2024 versus 68.7% for the prior year period. The increase in Employee Compensation and Benefits compared to the prior year period principally reflects a higher accrual for incentive compensation, higher base salaries and higher amortization of prior period deferred compensation awards. The Compensation Ratio was also impacted by higher net revenues, as described above, during the current year period compared to the prior year period. Year-to-date Employee Compensation and Benefits increased $237.7 million, or 22%, year-over-year, reflecting a year-to-date compensation ratio of 66.6% versus 66.8% for the prior year period. The increase in Employee Compensation and Benefits compared to the prior year period principally reflects a higher accrual for incentive compensation, higher base salaries and higher compensation expense related to senior new hires. The Compensation Ratio was also impacted by higher net revenues, as described above, during the current year period compared to the prior year period. See "Deferred Compensation" for more information.
Non-Compensation Costs – Third quarter Non-Compensation Costs increased $15.3 million, or 15%, year-over-year, primarily driven by an increase in travel and related expenses, largely due to higher levels of business activity and increased headcount, as well as an increase in professional fees and communications and information services, principally reflecting higher expenses associated with license fees and research services. The third quarter Non-Compensation ratio of 15.9% decreased from 17.8% for the prior year period. The Non-Compensation Ratio was also impacted by higher net revenues, as described above, during the current year period compared to the prior year period. Year-to-date Non-Compensation Costs increased $47.5 million, or 16%, year-over-year, primarily driven by an increase in professional fees and travel and related expenses, largely due to higher levels of business activity and increased headcount, as well as an increase in communications and information services, principally reflecting higher expenses associated with license fees and research services in 2024. The year-to-date Non-Compensation ratio of 17.4% decreased from 18.3% for the prior year period. The Non-Compensation Ratio was also impacted by higher net revenues, as described above, during the current year period compared to the prior year period.
Special Charges, Including Business Realignment Costs – Third quarter and year-to-date 2024 Special Charges, Including Business Realignment Costs, relate to the write-off of the remaining carrying value of the Company's investment in Luminis in connection with the redemption of the Company's interest. See page 3 for further information.
Year-to-date 2023 Special Charges, Including Business Realignment Costs, relate to the write-off of non-recoverable assets in connection with the wind-down of the Company's operations in Mexico.
Effective Tax Rate
The third quarter effective tax rate was 28.4% versus 25.1% for the prior year period. The year-to-date effective tax rate was 17.7% versus 21.5% for the prior year period. The effective tax rate is principally impacted by an increase in non-deductible expenses, state and local apportionment adjustments and the deduction associated with the appreciation in the Firm's share price upon vesting of employee share-based awards above the original grant price. The year-to-date provision for income taxes for 2024 reflects an additional tax benefit of $32.0 million versus $14.1 million for the prior year period, due to the net impact associated with the appreciation in our share price upon vesting of employee share-based awards above the original grant price.
Selected Financial Data – Adjusted Results
The following is a discussion of Evercore's consolidated results on an Adjusted basis. See pages 3 and A-2 to A-8 for further information and reconciliations of these metrics to our U.S. GAAP results. See pages A-5 to A-7 for our business segment results.
Adjusted Net Revenues
Adjusted
Three Months Ended
Nine Months Ended
September 30,
2024
September 30,
2023
%
Change
September 30,
2024
September 30,
2023
%
Change
(dollars in thousands)
Investment Banking & Equities:
Advisory Fees(1)
$
593,187
$
467,581
27
%
$
1,592,091
$
1,304,913
22
%
Underwriting Fees
44,132
30,814
43
%
130,666
91,897
42
%
Commissions and Related Revenue
54,559
48,697
12
%
155,996
146,810
6
%
Investment Management:
Asset Management and Administration Fees(2)
21,420
18,788
14
%
62,666
54,117
16
%
Other Revenue, net
26,237
10,188
158
%
80,714
61,255
32
%
Net Revenues
$
739,535
$
576,068
28
%
$
2,022,133
$
1,658,992
22
%
See page 4 for additional business metrics.
Advisory Fees – Third quarter adjusted Advisory Fees increased $125.6 million, or 27%, year-over-year, and year-to-date adjusted Advisory Fees increased $287.2 million, or 22%, year-over-year, reflecting an increase in revenue earned from large transactions and an increase the number of advisory fees earned during 2024.
Underwriting Fees – Third quarter Underwriting Fees increased $13.3 million, or 43%, year-over-year, and year-to-date Underwriting Fees increased $38.8 million, or 42%, year-over-year, reflecting an increase in the number of transactions we participated in during 2024.
Commissions and Related Revenue – Third quarter Commissions and Related Revenue increased $5.9 million, or 12%, year-over-year, and year-to-date Commissions and Related Revenue increased $9.2 million, or 6%, year-over-year, primarily reflecting higher trading commissions and subscription fees.
Asset Management and Administration Fees – Third quarter adjusted Asset Management and Administration Fees increased $2.6 million, or 14%, year-over-year, driven by an increase in fees from Wealth Management clients, as associated AUM increased 23%, primarily from market appreciation. The increase was partially offset by a 42% decrease in equity in earnings of affiliates, reflecting the sale of the remaining portion of our interest in ABS during the third quarter of 2024. Year-to-date adjusted Asset Management and Administration Fees increased $8.5 million, or 16%, year-over-year, driven by an increase in fees from Wealth Management clients, as associated AUM increased 23%, primarily from market appreciation. The increase was partially offset by a 2% decrease in equity in earnings of affiliates.
Other Revenue – Third quarter adjusted Other Revenue, net, increased $16.0 million, or 158%, year-over-year, and year-to-date adjusted Other Revenue, net, increased $19.5 million, or 32%, year-over-year, primarily reflecting higher performance of our investment funds portfolio, as well as higher interest income. The investment funds portfolio is used as an economic hedge against our deferred cash compensation program.
Adjusted Expenses
Adjusted
Three Months Ended
Nine Months Ended
September 30,
2024
September 30,
2023
%
Change
September 30,
2024
September 30,
2023
%
Change
(dollars in thousands)
Employee Compensation and Benefits
$
488,010
$
391,730
25
%
$
1,334,650
$
1,096,976
22
%
Compensation Ratio
66.0
%
68.0
%
66.0
%
66.1
%
Non-Compensation Costs
$
116,914
$
101,664
15
%
$
347,950
$
300,439
16
%
Non-Compensation Ratio
15.8
%
17.6
%
17.2
%
18.1
%
Employee Compensation and Benefits – Third quarter adjusted Employee Compensation and Benefits increased $96.3 million, or 25%, year-over-year, reflecting an adjusted compensation ratio of 66.0% for the third quarter of 2024 versus 68.0% for the prior year period. The increase in adjusted Employee Compensation and Benefits compared to the prior year period principally reflects a higher accrual for incentive compensation, higher base salaries and higher amortization of prior period deferred compensation awards. The adjusted Compensation Ratio was also impacted by higher net revenues, as described above, during the current year period compared to the prior year period. Year-to-date adjusted Employee Compensation and Benefits increased $237.7 million, or 22%, year-over-year, reflecting a year-to-date adjusted compensation ratio of 66.0% versus 66.1% for the prior year period. The increase in adjusted Employee Compensation and Benefits compared to the prior year period principally reflects a higher accrual for incentive compensation, higher base salaries and higher compensation expense related to senior new hires. The adjusted Compensation Ratio was also impacted by higher net revenues, as described above, during the current year period compared to the prior year period. See "Deferred Compensation" for more information.
Non-Compensation Costs – Third quarter adjusted Non-Compensation Costs increased $15.3 million, or 15%, year-over-year, primarily driven by an increase in travel and related expenses, largely due to higher levels of business activity and increased headcount, as well as an increase in professional fees and communications and information services, principally reflecting higher expenses associated with license fees and research services. The third quarter adjusted Non-Compensation ratio of 15.8% decreased from 17.6% for the prior year period. The adjusted Non-Compensation Ratio was also impacted by higher net revenues, as described above, during the current year period compared to the prior year period. Year-to-date adjusted Non-Compensation Costs increased $47.5 million, or 16%, year-over-year, primarily driven by an increase in professional fees and travel and related expenses, largely due to higher levels of business activity and increased headcount, as well as an increase in communications and information services, principally reflecting higher expenses associated with license fees and research services in 2024. The year-to-date adjusted Non-Compensation ratio of 17.2% decreased from 18.1% for the prior year period. The adjusted Non-Compensation Ratio was also impacted by higher net revenues, as described above, during the current year period compared to the prior year period.
Adjusted Effective Tax Rate
The third quarter adjusted effective tax rate was 28.9% versus 27.6% for the prior year period. The year-to-date adjusted effective tax rate was 18.2% versus 22.5% for the prior year period. The adjusted effective tax rate is principally impacted by an increase in non-deductible expenses, state and local apportionment adjustments and the deduction associated with the appreciation in the Firm's share price upon vesting of employee share-based awards above the original grant price. The year-to-date adjusted provision for income taxes for 2024 reflects an additional tax benefit of $34.3 million versus $15.0 million for the prior year period, due to the net impact associated with the appreciation in our share price upon vesting of employee share-based awards above the original grant price.
Liquidity
The Company continues to maintain a strong balance sheet. As of September 30, 2024, cash and cash equivalents were $533.1 million, investment securities and certificates of deposit were $1.3 billion and current assets exceeded current liabilities by $1.6 billion. Amounts due related to the Notes Payable were $375.9 million at September 30, 2024.
Headcount
As of September 30, 2024 and 2023, the Company employed approximately 2,395 and 2,230 people, respectively, worldwide.
As of September 30, 2024 and 2023, the Company employed 186(1) and 175(2) total Investment Banking & Equities Senior Managing Directors, respectively, of which 145(1) and 137(2), respectively, were Investment Banking Senior Managing Directors.
(1)
Senior Managing Director headcount as of September 30, 2024, adjusted to include four additional Investment Banking Senior Managing Directors committed to join in the fourth quarter of 2024 and in 2025.
(2)
Senior Managing Director headcount as of September 30, 2023, adjusted to include two additional Investment Banking Senior Managing Directors that joined in the fourth quarter of 2023 and the first quarter of 2024 and to exclude for known departures of three Investment Banking Senior Managing Directors.
Deferred Compensation
Year-to-date, the Company granted to certain employees 1.8 million unvested restricted stock units ("RSUs") (which were primarily granted in conjunction with the 2023 bonus awards) with a grant date fair value of $323.0 million.
In addition, year-to-date, the Company granted $143.2 million of deferred cash awards to certain employees, related to our deferred cash compensation program, principally pursuant to 2023 bonus awards.
The Company recognized compensation expense related to RSUs and our deferred cash compensation program of $115.9 million and $362.3 million for the three and nine months ended September 30, 2024, respectively, and $104.8 million and $335.5 million for the three and nine months ended September 30, 2023, respectively.
As of September 30, 2024, the Company had 5.1 million unvested RSUs with an aggregate grant date fair value of $753.9 million. RSUs are expensed over the service period of the award, subject to retirement eligibility, and generally vest over four years.
As of September 30, 2024, the Company expects to pay an aggregate of $393.3 million related to our deferred cash compensation program at various dates through 2028, subject to certain vesting events. Amounts due pursuant to this program are expensed over the service period of the award, subject to retirement eligibility, and are reflected in Accrued Compensation and Benefits, a component of current liabilities.
In addition, from time to time, the Company also grants cash and equity-based performance awards to certain employees, the settlement of which is dependent on the performance criteria being achieved.
Capital Return Transactions
On October 22, 2024, the Board of Directors of Evercore declared a quarterly dividend of $0.80 per share to be paid on December 13, 2024 to common stockholders of record on November 29, 2024.
During the third quarter, the Company repurchased 29 thousand shares from employees for the net settlement of stock-based compensation awards at an average price per share of $222.92, and 0.4 million shares at an average price per share of $236.91 in open market transactions pursuant to the Company's share repurchase program. The aggregate 0.4 million shares were acquired at an average price per share of $235.96. Year-to-date, the Company repurchased 1.0 million shares from employees for the net settlement of stock-based compensation awards at an average price per share of $178.02, and 1.2 million shares at an average price per share of $199.11 in open market transactions pursuant to the Company's share repurchase program. The aggregate 2.2 million shares were acquired at an average price per share of $189.69.
Conference Call
Evercore will host a related conference call beginning at 8:00 a.m. Eastern Time, Wednesday, October 23, 2024, accessible via telephone and webcast. Investors and analysts may participate in the live conference call by dialing (800) 225-9448 (toll-free domestic) or (203) 518-9708 (international); passcode: EVRQ324. Please register at least 10 minutes before the conference call begins.
A live audio webcast of the conference call will be available on the Investor Relations section of Evercore’s website at www.evercore.com. The webcast will be archived on Evercore’s website for 30 days.
About Evercore
Evercore (NYSE: EVR) is a premier global independent investment banking advisory firm. We are dedicated to helping our clients achieve superior results through trusted independent and innovative advice on matters of strategic significance to boards of directors, management teams and shareholders, including mergers and acquisitions, strategic shareholder advisory, restructurings, and capital structure. Evercore also assists clients in raising public and private capital and delivers equity research and equity sales and agency trading execution, in addition to providing wealth and investment management services to high net worth and institutional investors. Founded in 1995, the Firm is headquartered in New York and maintains offices and affiliate offices in major financial centers in the Americas, Europe, the Middle East and Asia. For more information, please visit www.evercore.com.
Basis of Alternative Financial Statement Presentation
Our Adjusted results are a non-GAAP measure. As discussed further under "Non-GAAP Measures", Evercore believes that the disclosed Adjusted measures and any adjustments thereto, when presented in conjunction with comparable U.S. GAAP measures, are useful to investors to compare Evercore's results across several periods and better reflects how management views its operating results. These measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with U.S. GAAP. A reconciliation of our U.S. GAAP results to Adjusted results is presented in the tables included in the following pages.
Forward-Looking Statements
This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, which reflect our current views with respect to, among other things, Evercore's operations and financial performance. In some cases, you can identify these forward-looking statements by the use of words such as "outlook," "backlog," "believes," "expects," "potential," "probable," "continues," "may," "will," "should," "seeks," "approximately," "predicts," "intends," "plans," "estimates," "anticipates" or the negative version of these words or other comparable words. All statements, other than statements of historical fact, included in this release are forward-looking statements and are based on various underlying assumptions and expectations and are subject to known and unknown risks, uncertainties and assumptions, and may include projections of our future financial performance based on our growth strategies and anticipated trends in Evercore's business. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. Evercore believes these factors include, but are not limited to, those described under "Risk Factors" discussed in Evercore's Annual Report on Form 10-K for the year ended December 31, 2023, subsequent quarterly reports on Form 10-Q, current reports on Form 8-K and Registration Statements. 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 Evercore to predict all risks and uncertainties, nor can Evercore 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 and Evercore does not assume any responsibility for the accuracy or completeness of any of these forward-looking statements. Evercore undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.
EVERCORE INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2024 AND 2023
(dollars in thousands, except per share data)
(UNAUDITED)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2024
2023
2024
2023
Revenues
Investment Banking & Equities:
Advisory Fees
$
592,980
$
467,401
$
1,591,049
$
1,304,519
Underwriting Fees
44,132
30,814
130,666
91,897
Commissions and Related Revenue
54,559
48,697
155,996
146,810
Asset Management and Administration Fees
20,555
17,304
58,454
49,837
Other Revenue, Including Interest and Investments
26,194
10,188
80,671
61,255
Total Revenues
738,420
574,404
2,016,836
1,654,318
Interest Expense(1)
4,198
4,184
12,575
12,536
Net Revenues
734,222
570,220
2,004,261
1,641,782
Expenses
Employee Compensation and Benefits
488,010
391,730
1,334,650
1,096,976
Occupancy and Equipment Rental
23,087
22,094
66,832
63,994
Professional Fees
32,313
28,390
97,820
79,992
Travel and Related Expenses
18,278
13,465
58,884
46,090
Communications and Information Services
21,242
18,435
59,995
52,006
Depreciation and Amortization
5,896
5,848
18,628
18,373
Execution, Clearing and Custody Fees
3,346
3,115
9,738
8,845
Special Charges, Including Business Realignment Costs
7,305
—
7,305
2,921
Other Operating Expenses
12,752
10,317
36,053
31,139
Total Expenses
612,229
493,394
1,689,905
1,400,336
Income Before Income from Equity Method Investments and Income Taxes
121,993
76,826
314,356
241,446
Income from Equity Method Investments
1,072
1,664
5,254
4,674
Income Before Income Taxes
123,065
78,490
319,610
246,120
Provision for Income Taxes
34,971
19,717
56,659
52,945
Net Income
88,094
58,773
262,951
193,175
Net Income Attributable to Noncontrolling Interest
9,701
6,625
25,107
20,444
Net Income Attributable to Evercore Inc.
$
78,393
$
52,148
$
237,844
$
172,731
Net Income Attributable to Evercore Inc. Common Shareholders
$
78,393
$
52,148
$
237,844
$
172,731
Weighted Average Shares of Class A Common Stock Outstanding:
Basic
38,294
37,823
38,411
38,179
Diluted
42,038
40,000
41,325
39,907
Net Income Per Share Attributable to Evercore Inc. Common Shareholders:
Basic
$
2.05
$
1.38
$
6.19
$
4.52
Diluted
$
1.86
$
1.30
$
5.76
$
4.33
(1) Includes interest expense on long-term debt.
Adjusted Results
Throughout the discussion of Evercore's business and elsewhere in this release, information is presented on an Adjusted basis, which is a non-generally accepted accounting principles ("non-GAAP") measure. Adjusted results begin with information prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"), adjusted to exclude certain items and reflect the conversion of certain Evercore LP Units and Unvested Restricted Stock Units into Class A shares. Evercore believes that the disclosed Adjusted measures and any adjustments thereto, when presented in conjunction with comparable U.S. GAAP measures, are useful to investors to compare Evercore's results across several periods and facilitate an understanding of Evercore's operating results. The Company uses these measures to evaluate its operating performance, as well as the performance of individual employees. These measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with U.S. GAAP. These Adjusted amounts are allocated to the Company's two business segments: Investment Banking & Equities and Investment Management. The differences between the Adjusted and U.S. GAAP results are as follows:
EVERCORE INC.
U.S. GAAP RECONCILIATION TO ADJUSTED RESULTS
(dollars in thousands, except per share data)
(UNAUDITED)
Three Months Ended
Nine Months Ended
September 30,
2024
September 30,
2023
September 30,
2024
September 30,
2023
Net Revenues - U.S. GAAP
$
734,222
$
570,220
$
2,004,261
$
1,641,782
Income from Equity Method Investments (1)
1,072
1,664
5,254
4,674
Interest Expense on Debt (2)
4,198
4,184
12,575
12,536
Release of Foreign Exchange Losses from Luminis Redemption (3)
658
—
658
—
Gain on Sale of Interests in ABS (4)
(615
)
—
(615
)
—
Net Revenues - Adjusted
$
739,535
$
576,068
$
2,022,133
$
1,658,992
Other Revenue, net - U.S. GAAP
$
21,996
$
6,004
$
68,096
$
48,719
Interest Expense on Debt (2)
4,198
4,184
12,575
12,536
Release of Foreign Exchange Losses from Luminis Redemption (3)
658
—
658
—
Gain on Sale of Interests in ABS (4)
(615
)
—
(615
)
—
Other Revenue, net - Adjusted
$
26,237
$
10,188
$
80,714
$
61,255
Operating Income - U.S. GAAP
$
121,993
$
76,826
$
314,356
$
241,446
Income from Equity Method Investments (1)
1,072
1,664
5,254
4,674
Pre-Tax Income - U.S. GAAP
123,065
78,490
319,610
246,120
Release of Foreign Exchange Losses from Luminis Redemption (3)
658
—
658
—
Gain on Sale of Interests in ABS (4)
(615
)
—
(615
)
—
Special Charges, Including Business Realignment Costs (5)
7,305
—
7,305
2,921
Pre-Tax Income - Adjusted
130,413
78,490
326,958
249,041
Interest Expense on Debt (2)
4,198
4,184
12,575
12,536
Operating Income - Adjusted
$
134,611
$
82,674
$
339,533
$
261,577
Provision for Income Taxes - U.S. GAAP
$
34,971
$
19,717
$
56,659
$
52,945
Income Taxes (6)
2,771
1,915
2,702
3,115
Provision for Income Taxes - Adjusted
$
37,742
$
21,632
$
59,361
$
56,060
Net Income Attributable to Evercore Inc. - U.S. GAAP
$
78,393
$
52,148
$
237,844
$
172,731
Release of Foreign Exchange Losses from Luminis Redemption (3)
658
—
658
—
Gain on Sale of Interests in ABS (4)
(615
)
—
(615
)
—
Special Charges, Including Business Realignment Costs (5)
7,305
—
7,305
2,921
Income Taxes (6)
(2,771
)
(1,915
)
(2,702
)
(3,115
)
Noncontrolling Interest (7)
7,955
5,254
20,035
16,563
Net Income Attributable to Evercore Inc. - Adjusted
$
90,925
$
55,487
$
262,525
$
189,100
Diluted Shares Outstanding - U.S. GAAP
42,038
40,000
41,325
39,907
LP Units (8)
2,476
2,790
2,549
2,787
Unvested Restricted Stock Units - Event Based (8)
12
12
12
12
Diluted Shares Outstanding - Adjusted
44,526
42,802
43,886
42,706
Key Metrics: (a)
Diluted Earnings Per Share - U.S. GAAP
$
1.86
$
1.30
$
5.76
$
4.33
Diluted Earnings Per Share - Adjusted
$
2.04
$
1.30
$
5.98
$
4.43
Operating Margin - U.S. GAAP
16.6
%
13.5
%
15.7
%
14.7
%
Operating Margin - Adjusted
18.2
%
14.4
%
16.8
%
15.8
%
Effective Tax Rate - U.S. GAAP
28.4
%
25.1
%
17.7
%
21.5
%
Effective Tax Rate - Adjusted
28.9
%
27.6
%
18.2
%
22.5
%
(a) Reconciliations of the key metrics from U.S. GAAP to Adjusted results are a derivative of the reconciliations of their components above.
EVERCORE INC.
U.S. GAAP SEGMENT RECONCILIATION TO ADJUSTED RESULTS
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2024
(dollars in thousands)
(UNAUDITED)
Investment Banking & Equities Segment
Three Months Ended September 30, 2024
Nine Months Ended September 30, 2024
U.S. GAAP
Basis
Adjustments
Non-GAAP
Adjusted Basis
U.S. GAAP
Basis
Adjustments
Non-GAAP
Adjusted Basis
Net Revenues:
Investment Banking & Equities:
Advisory Fees
$
592,980
$
207
(1)
$
593,187
$
1,591,049
$
1,042
(1)
$
1,592,091
Underwriting Fees
44,132
—
44,132
130,666
—
130,666
Commissions and Related Revenue
54,559
—
54,559
155,996
—
155,996
Other Revenue, net
21,104
4,856
(2)(3)
25,960
66,802
13,233
(2)(3)
80,035
Net Revenues
712,775
5,063
717,838
1,944,513
14,275
1,958,788
Expenses:
Employee Compensation and Benefits
475,990
—
475,990
1,301,341
—
1,301,341
Non-Compensation Costs
113,093
—
113,093
336,948
—
336,948
Special Charges, Including Business Realignment Costs
7,305
(7,305
)
(5)
—
7,305
(7,305
)
(5)
—
Total Expenses
596,388
(7,305
)
589,083
1,645,594
(7,305
)
1,638,289
Operating Income (a)
$
116,387
$
12,368
$
128,755
$
298,919
$
21,580
$
320,499
Compensation Ratio (b)
66.8
%
66.3
%
66.9
%
66.4
%
Operating Margin (b)
16.3
%
17.9
%
15.4
%
16.4
%
Investment Management Segment
Three Months Ended September 30, 2024
Nine Months Ended September 30, 2024
U.S. GAAP
Basis
Adjustments
Non-GAAP
Adjusted Basis
U.S. GAAP
Basis
Adjustments
Non-GAAP
Adjusted Basis
Net Revenues:
Asset Management and Administration Fees
$
20,555
$
865
(1)
$
21,420
$
58,454
$
4,212
(1)
$
62,666
Other Revenue, net
892
(615
)
(4)
277
1,294
(615
)
(4)
679
Net Revenues
21,447
250
21,697
59,748
3,597
63,345
Expenses:
Employee Compensation and Benefits
12,020
—
12,020
33,309
—
33,309
Non-Compensation Costs
3,821
—
3,821
11,002
—
11,002
Total Expenses
15,841
—
15,841
44,311
—
44,311
Operating Income (a)
$
5,606
$
250
$
5,856
$
15,437
$
3,597
$
19,034
Compensation Ratio (b)
56.0
%
55.4
%
55.7
%
52.6
%
Operating Margin (b)
26.1
%
27.0
%
25.8
%
30.0
%
(a) Operating Income for U.S. GAAP excludes Income (Loss) from Equity Method Investments.
(b) Reconciliations of the key metrics from U.S. GAAP to Adjusted results are a derivative of the reconciliations of their components above.
EVERCORE INC.
U.S. GAAP SEGMENT RECONCILIATION TO ADJUSTED RESULTS
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2023
(dollars in thousands)
(UNAUDITED)
Investment Banking & Equities Segment
Three Months Ended September 30, 2023
Nine Months Ended September 30, 2023
U.S. GAAP
Basis
Adjustments
Non-GAAP
Adjusted Basis
U.S. GAAP
Basis
Adjustments
Non-GAAP
Adjusted Basis
Net Revenues:
Investment Banking & Equities:
Advisory Fees
$
467,401
$
180
(1)
$
467,581
$
1,304,519
$
394
(1)
$
1,304,913
Underwriting Fees
30,814
—
30,814
91,897
—
91,897
Commissions and Related Revenue
48,697
—
48,697
146,810
—
146,810
Other Revenue, net
5,729
4,184
(2)
9,913
46,472
12,536
(2)
59,008
Net Revenues
552,641
4,364
557,005
1,589,698
12,930
1,602,628
Expenses:
Employee Compensation and Benefits
381,117
—
381,117
1,066,686
—
1,066,686
Non-Compensation Costs
98,312
—
98,312
290,167
—
290,167
Special Charges, Including Business Realignment Costs
—
—
—
2,921
(2,921
)
(5)
—
Total Expenses
479,429
—
479,429
1,359,774
(2,921
)
1,356,853
Operating Income (a)
$
73,212
$
4,364
$
77,576
$
229,924
$
15,851
$
245,775
Compensation Ratio (b)
69.0
%
68.4
%
67.1
%
66.6
%
Operating Margin (b)
13.2
%
13.9
%
14.5
%
15.3
%
Investment Management Segment
Three Months Ended September 30, 2023
Nine Months Ended September 30, 2023
U.S. GAAP
Basis
Adjustments
Non-GAAP
Adjusted Basis
U.S. GAAP
Basis
Adjustments
Non-GAAP
Adjusted Basis
Net Revenues:
Asset Management and Administration Fees
$
17,304
$
1,484
(1)
$
18,788
$
49,837
$
4,280
(1)
$
54,117
Other Revenue, net
275
—
275
2,247
—
2,247
Net Revenues
17,579
1,484
19,063
52,084
4,280
56,364
Expenses:
Employee Compensation and Benefits
10,613
—
10,613
30,290
—
30,290
Non-Compensation Costs
3,352
—
3,352
10,272
—
10,272
Total Expenses
13,965
—
13,965
40,562
—
40,562
Operating Income (a)
$
3,614
$
1,484
$
5,098
$
11,522
$
4,280
$
15,802
Compensation Ratio (b)
60.4
%
55.7
%
58.2
%
53.7
%
Operating Margin (b)
20.6
%
26.7
%
22.1
%
28.0
%
(a) Operating Income for U.S. GAAP excludes Income (Loss) from Equity Method Investments.
(b) Reconciliations of the key metrics from U.S. GAAP to Adjusted results are a derivative of the reconciliations of their components above.
EVERCORE INC.
U.S. GAAP SEGMENT AND CONSOLIDATED RESULTS
(dollars in thousands)
(UNAUDITED)
U.S. GAAP
Three Months Ended
September 30,
Nine Months Ended
September 30,
2024
2023
2024
2023
Investment Banking & Equities
Net Revenues:
Investment Banking & Equities:
Advisory Fees
$
592,980
$
467,401
$
1,591,049
$
1,304,519
Underwriting Fees
44,132
30,814
130,666
91,897
Commissions and Related Revenue
54,559
48,697
155,996
146,810
Other Revenue, net
21,104
5,729
66,802
46,472
Net Revenues
712,775
552,641
1,944,513
1,589,698
Expenses:
Employee Compensation and Benefits
475,990
381,117
1,301,341
1,066,686
Non-Compensation Costs
113,093
98,312
336,948
290,167
Special Charges, Including Business Realignment Costs
7,305
—
7,305
2,921
Total Expenses
596,388
479,429
1,645,594
1,359,774
Operating Income (a)
$
116,387
$
73,212
$
298,919
$
229,924
Investment Management
Net Revenues:
Asset Management and Administration Fees
$
20,555
$
17,304
$
58,454
$
49,837
Other Revenue, net
892
275
1,294
2,247
Net Revenues
21,447
17,579
59,748
52,084
Expenses:
Employee Compensation and Benefits
12,020
10,613
33,309
30,290
Non-Compensation Costs
3,821
3,352
11,002
10,272
Total Expenses
15,841
13,965
44,311
40,562
Operating Income (a)
$
5,606
$
3,614
$
15,437
$
11,522
Total
Net Revenues:
Investment Banking & Equities:
Advisory Fees
$
592,980
$
467,401
$
1,591,049
$
1,304,519
Underwriting Fees
44,132
30,814
130,666
91,897
Commissions and Related Revenue
54,559
48,697
155,996
146,810
Asset Management and Administration Fees
20,555
17,304
58,454
49,837
Other Revenue, net
21,996
6,004
68,096
48,719
Net Revenues
734,222
570,220
2,004,261
1,641,782
Expenses:
Employee Compensation and Benefits
488,010
391,730
1,334,650
1,096,976
Non-Compensation Costs
116,914
101,664
347,950
300,439
Special Charges, Including Business Realignment Costs
7,305
—
7,305
2,921
Total Expenses
612,229
493,394
1,689,905
1,400,336
Operating Income (a)
$
121,993
$
76,826
$
314,356
$
241,446
(a) Operating Income excludes Income (Loss) from Equity Method Investments.
Notes to Unaudited Condensed Consolidated Adjusted Financial Data
For further information on these adjustments, see page A-2.
(1)
Income (Loss) from Equity Method Investments has been reclassified to Revenue in the Adjusted presentation.
(2)
Interest Expense on Debt is excluded from Net Revenues and presented below Operating Income in the Adjusted results and is included in Interest Expense on a U.S. GAAP basis.
(3)
The release of cumulative foreign exchange losses in the third quarter of 2024 resulting from the redemption of the Company's interest in Luminis is excluded from the Adjusted presentation.
(4)
The gain on the sale of the remaining portion of the Company's interest in ABS in the third quarter of 2024 is excluded from the Adjusted presentation.
(5)
Expenses during 2024 that are excluded from the Adjusted presentation relate to the write-off of the remaining carrying value of the Company's investment in Luminis in connection with the redemption of the Company's interest. Expenses during 2023 that are excluded from the Adjusted presentation relate to the write-off of non-recoverable assets in connection with the wind-down of the Company's operations in Mexico.
(6)
Evercore is organized as a series of Limited Liability Companies, Partnerships, C-Corporations and a Public Corporation in the U.S. as the ultimate parent. Certain of the subsidiaries, particularly Evercore LP, have noncontrolling interests held by management or former members of management. As a result, not all of the Company’s income is subject to corporate level taxes and certain other state and local taxes are levied. The assumption in the Adjusted earnings presentation is that substantially all of the noncontrolling interest is eliminated through the exchange of Evercore LP units into Class A common stock of the ultimate parent. As a result, the Adjusted earnings presentation assumes that the allocation of earnings to Evercore LP’s noncontrolling interest holders is substantially eliminated and is therefore subject to statutory tax rates of a C-Corporation under a conventional tax structure in the U.S. and that certain state and local taxes are reduced accordingly.
(7)
Reflects an adjustment to eliminate noncontrolling interest related to substantially all Evercore LP partnership units which are assumed to be converted to Class A common stock in the Adjusted presentation.
(8)
Assumes the exchange into Class A shares of substantially all Evercore LP Units and IPO related restricted stock unit awards in the Adjusted presentation. In the computation of outstanding common stock equivalents for U.S. GAAP net income per share, the Evercore LP Units are anti-dilutive.
View source version on businesswire.com: https://www.businesswire.com/news/home/20241022941067/en/
Investor Contact:
Katy Haber Head of Investor Relations & ESG InvestorRelations@Evercore.com
Media Contacts:
Jamie Easton Head of Communications & External Affairs Communications@Evercore.com
Shree Dhond / Zach Kouwe Dukas Linden Public Relations Evercore@DLPR.com (646) 722-6531
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