PJT Partners Inc. Reports Record First Quarter 2024 Results
First Quarter Overview
-
Record First Quarter Revenues of
$329 million , an increase of 65% from a year ago -
GAAP Pretax Income of
$54 million and Adjusted Pretax Income of$55 million , an increase of 85% and 81%, respectively, from a year ago -
GAAP Diluted EPS of
$1.22 and Adjusted EPS of$0.98 , an increase of 82% and 81%, respectively, from a year ago
Capital Management and Balance Sheet
- 1.5 million share and share equivalents repurchased with record open market repurchases of 1.1 million shares
-
Record First Quarter cash, cash equivalents and short-term investments of
$236 million and no funded debt
Revenues
The following table sets forth revenues for the three months ended
|
|
Three Months Ended
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|
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||||||
|
|
2024 |
|
2023 |
|
% Change |
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|
(Dollars in Millions) |
|||||||||
Revenues |
|
|
|||||||||
Advisory |
|
$ |
288.7 |
|
|
$ |
168.1 |
|
|
72 |
% |
Placement |
|
|
34.5 |
|
|
|
27.6 |
|
|
25 |
% |
Interest Income & Other |
|
|
6.2 |
|
|
|
4.3 |
|
|
44 |
% |
Total Revenues |
|
$ |
329.4 |
|
|
$ |
200.0 |
|
|
65 |
% |
Total Revenues of
Advisory Revenues of
Placement Revenues of
Interest Income & Other of
Expenses
The following table sets forth information relating to the Company’s expenses for the three months ended
|
|
Three Months Ended |
|
|||||||||||||
|
|
2024 |
|
|
2023 |
|
||||||||||
|
|
GAAP |
|
|
As Adjusted |
|
|
GAAP |
|
|
As Adjusted |
|
||||
|
|
(Dollars in Millions) |
|
|||||||||||||
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Compensation and Benefits |
|
$ |
228.9 |
|
|
$ |
228.9 |
|
|
$ |
133.0 |
|
|
$ |
133.0 |
|
% of Revenues |
|
|
69.5 |
% |
|
|
69.5 |
% |
|
|
66.5 |
% |
|
|
66.5 |
% |
Non-Compensation |
|
$ |
46.6 |
|
|
$ |
45.2 |
|
|
$ |
37.8 |
|
|
$ |
36.5 |
|
% of Revenues |
|
|
14.1 |
% |
|
|
13.7 |
% |
|
|
18.9 |
% |
|
|
18.2 |
% |
Total Expenses |
|
$ |
275.5 |
|
|
$ |
274.2 |
|
|
$ |
170.8 |
|
|
$ |
169.5 |
|
% of Revenues |
|
|
83.6 |
% |
|
|
83.2 |
% |
|
|
85.4 |
% |
|
|
84.8 |
% |
Pretax Income |
|
$ |
53.9 |
|
|
$ |
55.2 |
|
|
$ |
29.2 |
|
|
$ |
30.4 |
|
% of Revenues |
|
|
16.4 |
% |
|
|
16.8 |
% |
|
|
14.6 |
% |
|
|
15.2 |
% |
Compensation and Benefits Expense
Compensation and Benefits Expense was
Non-Compensation Expense
GAAP Non-Compensation Expense was
The increase in GAAP and Adjusted Non-Compensation Expense for the current quarter compared with the prior year was principally due to increases in Other Expenses, Occupancy and Related and Travel and Related expenses. Other Expenses increased principally due to higher bad debt expense. Occupancy and Related increased principally due to the further expansion and lease term extension of our
Provision for Taxes
As of
In calculating Adjusted Net Income, If-Converted, the Company has assumed that all outstanding partnership units in
The effective tax rate for Adjusted Net Income, If-Converted for the three months ended
Capital Management and Balance Sheet
As of
During the first quarter 2024, the Company repurchased 1.1 million shares of Class A common stock in the open market, exchanged 0.2 million Partnership Units for cash and net share settled 0.3 million shares of Class A common stock to satisfy employee tax obligations. In total during the first quarter 2024, the Company repurchased 1.5 million share equivalents at an average price of
As of
The Company intends to repurchase 0.1 million Partnership Units for cash on
Dividend
The Board of Directors of
Quarterly Investor Call Details
About
Forward-Looking Statements
Certain material presented herein contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Forward-looking statements include certain information concerning future results of operations, business strategies, acquisitions, financing plans, competitive position, potential growth opportunities, potential operating performance improvements, the effects of competition and the effects of future legislation or regulations. Forward-looking statements include all statements that are not historical facts and can be identified by the use of forward-looking terminology such as the words “believe,” “expect,” “opportunity,” “plan,” “intend,” “anticipate,” “estimate,” “predict,” “potential,” “continue,” “may,” “might,” “should,” “could” or the negative of these terms or similar expressions.
Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict, many of which are outside our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not place undue reliance upon any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following: (a) changes in governmental regulations and policies; (b) cyber attacks, security vulnerabilities and internet disruptions, including breaches of data security and privacy leaks, data loss and business interruptions; (c) failures of our computer systems or communication systems, including as a result of a catastrophic event and the use of remote work environments and virtual platforms; (d) the impact of catastrophic events, including business disruptions, pandemics, reductions in employment and an increase in business failures on (1) the
Any of these factors, as well as such other factors discussed in the “Risk Factors” section of the Company’s Annual Report on Form 10-K for the year ended
Non-GAAP Financial Measures
The following represent key performance measures that management uses in making resource allocation and/or compensation decisions. These measures should not be considered substitutes for, or superior to, financial measures prepared in accordance with GAAP.
Management believes the following non-GAAP measures, when presented together with comparable GAAP measures, are useful to investors in understanding the Company’s operating results: Adjusted Pretax Income; Adjusted Net Income; Adjusted Net Income, If-Converted, in total and on a per-share basis (referred to as “Adjusted EPS”); Adjusted Non-Compensation Expense. These non-GAAP measures, presented and discussed in this earnings release, remove the significant accounting impact of: (a) intangible asset amortization associated with the acquisition of
To help investors understand the effect of the Company’s ownership structure on its Adjusted Net Income, the Company has presented Adjusted Net Income, If-Converted. This measure illustrates the impact of taxes on Adjusted Pretax Income, assuming all Partnership Units (excluding Partnership Units that have yet to satisfy certain market conditions) have been exchanged for shares of the Company’s Class A common stock, resulting in all of the Company’s income becoming subject to corporate-level tax, considering both current and deferred income tax effects. This tax rate excludes a number of adjustments, including the tax benefits of the adjustments for transaction-related amortization expense.
Appendix
GAAP Condensed Consolidated Statements of Operations (unaudited)
Reconciliations of GAAP to Non-GAAP Financial Data (unaudited)
Summary of Shares Outstanding (unaudited)
Footnotes
GAAP Condensed Consolidated Statements of Operations (unaudited) (Dollars in Thousands, Except Share and Per Share Data) |
||||||||
|
|
Three Months Ended
|
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Revenues |
|
|
|
|
|
|
||
Advisory |
|
$ |
288,681 |
|
|
$ |
168,090 |
|
Placement |
|
|
34,489 |
|
|
|
27,585 |
|
Interest Income and Other |
|
|
6,223 |
|
|
|
4,313 |
|
Total Revenues |
|
|
329,393 |
|
|
|
199,988 |
|
Expenses |
|
|
|
|
|
|
||
Compensation and Benefits |
|
|
228,928 |
|
|
|
133,043 |
|
Occupancy and Related |
|
|
12,161 |
|
|
|
10,011 |
|
Travel and Related |
|
|
9,101 |
|
|
|
6,972 |
|
Professional Fees |
|
|
8,349 |
|
|
|
6,927 |
|
Communications and Information Services |
|
|
4,778 |
|
|
|
4,077 |
|
Depreciation and Amortization |
|
|
3,498 |
|
|
|
3,443 |
|
Other Expenses |
|
|
8,675 |
|
|
|
6,322 |
|
Total Expenses |
|
|
275,490 |
|
|
|
170,795 |
|
Income Before Provision for Taxes |
|
|
53,903 |
|
|
|
29,193 |
|
Provision for Taxes |
|
|
531 |
|
|
|
1,207 |
|
Net Income |
|
|
53,372 |
|
|
|
27,986 |
|
Net Income Attributable to Non-Controlling Interests |
|
|
20,749 |
|
|
|
10,650 |
|
Net Income Attributable to |
|
$ |
32,623 |
|
|
$ |
17,336 |
|
Net Income Per Share of Class A Common Stock |
|
|
|
|
|
|
||
Basic |
|
$ |
1.27 |
|
|
$ |
0.69 |
|
Diluted |
|
$ |
1.22 |
|
|
$ |
0.67 |
|
Weighted-Average Shares of Class A Common |
||||||||
Stock Outstanding |
|
|
|
|
|
|
||
Basic |
|
|
25,690,530 |
|
|
|
25,231,815 |
|
Diluted |
|
|
28,168,504 |
|
|
|
26,918,511 |
|
Reconciliations of GAAP to Non-GAAP Financial Data (unaudited) (Dollars in Thousands, Except Share and Per Share Data) |
||||||||
|
|
Three Months Ended
|
|
|||||
|
|
2024 |
|
|
2023 |
|
||
GAAP Net Income |
|
$ |
53,372 |
|
|
$ |
27,986 |
|
Less: GAAP Provision for Taxes |
|
|
531 |
|
|
|
1,207 |
|
GAAP Pretax Income |
|
|
53,903 |
|
|
|
29,193 |
|
|
|
|
|
|
|
|
||
Adjustments to GAAP Pretax Income |
|
|
|
|
|
|
||
Amortization of Intangible Assets(1) |
|
|
1,230 |
|
|
|
1,230 |
|
Spin-Off-Related Payable Due to |
|
|
91 |
|
|
|
25 |
|
Adjusted Pretax Income |
|
|
55,224 |
|
|
|
30,448 |
|
Adjusted Taxes(3) |
|
|
795 |
|
|
|
1,431 |
|
Adjusted Net Income |
|
|
54,429 |
|
|
|
29,017 |
|
|
|
|
|
|
|
|
||
If-Converted Adjustments |
|
|
|
|
|
|
||
Less: Adjusted Taxes(3) |
|
|
(795 |
) |
|
|
(1,431 |
) |
Add: If-Converted Taxes(4) |
|
|
12,149 |
|
|
|
7,909 |
|
Adjusted Net Income, If-Converted |
|
$ |
43,075 |
|
|
$ |
22,539 |
|
|
|
|
|
|
|
|
||
GAAP Net Income Per Share of Class A Common Stock |
|
|
|
|
|
|
||
Basic |
|
$ |
1.27 |
|
|
$ |
0.69 |
|
Diluted |
|
$ |
1.22 |
|
|
$ |
0.67 |
|
GAAP Weighted-Average Shares of Class A |
||||||||
Common Stock Outstanding |
|
|
|
|
|
|
||
Basic |
|
|
25,690,530 |
|
|
|
25,231,815 |
|
Diluted |
|
|
28,168,504 |
|
|
|
26,918,511 |
|
|
|
|
|
|
|
|
||
Adjusted Net Income, If-Converted Per Share |
|
$ |
0.98 |
|
|
$ |
0.54 |
|
Weighted-Average Shares Outstanding, If-Converted |
|
|
43,737,118 |
|
|
|
41,684,276 |
|
Reconciliations of GAAP to Non-GAAP Financial Data – continued (unaudited) (Dollars in Thousands) |
||||||||
|
|
Three Months Ended
|
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Non-Compensation Expenses |
|
|
|
|
|
|
||
Occupancy and Related |
|
$ |
12,161 |
|
|
$ |
10,011 |
|
Travel and Related |
|
|
9,101 |
|
|
|
6,972 |
|
Professional Fees |
|
|
8,349 |
|
|
|
6,927 |
|
Communications and Information Services |
|
|
4,778 |
|
|
|
4,077 |
|
Depreciation and Amortization |
|
|
3,498 |
|
|
|
3,443 |
|
Other Expenses |
|
|
8,675 |
|
|
|
6,322 |
|
GAAP Non-Compensation Expense |
|
|
46,562 |
|
|
|
37,752 |
|
Amortization of Intangible Assets(1) |
|
|
(1,230 |
) |
|
|
(1,230 |
) |
Spin-Off-Related Payable Due to |
|
|
(91 |
) |
|
|
(25 |
) |
Adjusted Non-Compensation Expense |
|
$ |
45,241 |
|
|
$ |
36,497 |
|
Summary of Shares Outstanding (unaudited)
The following table provides a summary of weighted-average shares outstanding for the three months ended
|
|
Three Months Ended
|
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Weighted-Average Shares Outstanding - GAAP |
|
|
|
|
|
|
||
Basic Shares Outstanding, GAAP |
|
|
25,690,530 |
|
|
|
25,231,815 |
|
Dilutive Impact of Unvested RSUs(5) |
|
|
2,477,974 |
|
|
|
1,686,696 |
|
Diluted Shares Outstanding, GAAP |
|
|
28,168,504 |
|
|
|
26,918,511 |
|
|
|
|
|
|
|
|
||
Weighted-Average Shares Outstanding - If-Converted |
|
|
|
|
|
|
||
Basic Shares Outstanding, GAAP |
|
|
25,690,530 |
|
|
|
25,231,815 |
|
Unvested RSUs(5) |
|
|
2,477,974 |
|
|
|
1,686,696 |
|
Partnership Units(6) |
|
|
15,568,614 |
|
|
|
14,765,765 |
|
If-Converted Shares Outstanding |
|
|
43,737,118 |
|
|
|
41,684,276 |
|
|
|
|
|
|
|
|
||
|
|
As of |
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Fully-Diluted Shares Outstanding(7) |
|
|
46,597,467 |
|
|
|
44,367,647 |
|
As of
Footnotes
(1) |
This adjustment adds back to GAAP Pretax Income amounts for the amortization of intangible assets that are associated with the acquisition of |
|
(2) |
This adjustment adds back to GAAP Pretax Income the net change to the amount the Company has agreed to pay |
|
(3) |
Represents taxes on Adjusted Pretax Income, considering both current and deferred income tax effects for the current ownership structure. |
|
(4) |
Represents taxes on Adjusted Pretax Income, assuming all Partnership Units (excluding Partnership Units that have yet to satisfy market conditions) have been exchanged for shares of the Company’s Class A common stock, resulting in all of the Company’s income becoming subject to corporate-level tax, considering both current and deferred income tax effects. This tax rate excludes a number of adjustments, including the tax benefits of the adjustments for amortization expense. |
|
(5) |
Represents the dilutive impact under the treasury method of unvested RSUs that have a remaining service requirement. |
|
(6) |
Represents the number of shares assuming the conversion of all Partnership Units, including Partnership Units that achieved certain market conditions as of the date those conditions were achieved, and excludes Partnership Units that have yet to satisfy certain market conditions. |
|
(7) |
Assumes all Partnership Units and unvested RSUs have been converted to shares of the Company’s Class A common stock. As of |
|
Note: Amounts presented in tables above may not add or recalculate due to rounding. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240501558888/en/
Media Relations:
Tel: +1 212.355.4449
PJT-JF@joelefrank.com
Investor Relations:
Tel: +1 212.364.7120
pearson@pjtpartners.com
Source: