Evercore Inc. (NYSE: EVR):
Fourth Quarter Results
Full Year Results
U.S. GAAP
Adjusted
U.S. GAAP
Adjusted
Q4 2022
Q4 2021
Q4 2022
Q4 2021
2022
2021
2022
2021
Net Revenues ($ mm)
$
831.3
$
1,115.8
$
836.7
$
1,124.1
$
2,762.0
$
3,289.5
$
2,785.6
$
3,316.9
Operating Income ($ mm)
$
210.1
$
456.1
$
218.0
$
464.4
$
696.0
$
1,102.4
$
722.7
$
1,138.4
Net Income Attributable to Evercore Inc.
($ mm)
$
140.4
$
295.9
$
152.4
$
338.3
$
476.5
$
740.1
$
528.7
$
843.2
Diluted Earnings Per Share
$
3.44
$
6.96
$
3.50
$
7.15
$
11.61
$
17.08
$
12.01
$
17.50
Compensation Ratio
62.9
%
50.1
%
62.5
%
49.7
%
61.5
%
56.2
%
60.9
%
55.7
%
Operating Margin
25.3
%
40.9
%
26.1
%
41.3
%
25.2
%
33.5
%
25.9
%
34.3
%
Effective Tax Rate
27.7
%
23.9
%
28.2
%
25.2
%
24.5
%
22.2
%
24.5
%
23.8
%
Business and Financial
Highlights
■
Fourth Quarter and Full Year Net Revenues
were $831.3 million and $2.8 billion, respectively, on a U.S. GAAP
basis and $836.7 million and $2.8 billion, respectively, on an
Adjusted basis, decreasing on both a U.S. GAAP and an Adjusted
basis versus 2021
■
Fourth Quarter and Full Year Net Income
was $140.4 million and $476.5 million, respectively, on a U.S. GAAP
basis and $152.4 million and $528.7 million, respectively, on an
Adjusted basis, decreasing on both a U.S. GAAP and an Adjusted
basis versus 2021
■
Our results represent the second best Full
Year on both a U.S. GAAP and Adjusted basis in the Firm’s
history
■
Full Year Advisory Fees were $2.4 billion
on both a U.S. GAAP and an Adjusted basis, representing the second
best year in our history
■
Evercore’s Advisory team in Europe had a
record year, seeing strength across the Energy, Financials, and
Utilities & Infrastructure sectors, in addition to our Debt
Advisory practice in the region
■
Evercore advised on some of the most
unique and complex situations in 2022, including General Electric
on their separation of GE HealthCare
■
Our private capital advisory activities
had the second-best year on record, holistically, across the
Private Capital Advisory, Private Funds Group and Real Estate
Capital Advisory teams
■
In 2022, Evercore was bookrunner on all
equity and equity-linked underwriting transactions that the Firm
participated in and was involved in four of the five largest U.S.
IPOs
Talent
■
Tim LaLonde has been named Chief Financial
Officer, effective March 6, 2023, succeeding Celeste Mellet
■
Promoted seven Advisory Managing Directors
and one Equities Managing Director to Senior Managing Director and
three Managing Directors to Partner in our Evercore Wealth
Management business in January 2023, representing the investments
we have made in developing our talent
■
We hired seven Advisory Senior Managing
Directors and a Senior Advisor in 2022, all in areas of strategic
significance
■
One additional Advisory Senior Managing
Director has committed to join in the first quarter of 2023,
contributing to our Private Capital Advisory business
Capital Return
■
Quarterly dividend of $0.72 per share
■
Returned $655.0 million to shareholders
during 2022 through dividends and repurchases of 4.4 million shares
at an average price of $117.27
Evercore Inc. (NYSE: EVR) today announced its results for the
fourth quarter and full year ended December 31, 2022.
LEADERSHIP COMMENTARY
John S. Weinberg, Chairman and Chief Executive Officer,
"Evercore's results demonstrate our strong competitive and
financial positioning. 2022 also marked a year of investment for
our firm as we continued to invest in our businesses and serve our
clients. We remain focused on executing our growth strategy and we
believe the breadth and depth of our diverse platform will continue
to drive long-term value."
Roger C. Altman, Founder and Senior Chairman, "Evercore
realized the second best year in its history, and again gained
market share, despite weakening macroeconomic conditions as the
year progressed. We don't yet know how 2023 will unfold, but,
competitively speaking, the Firm has never been more strongly
positioned."
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:
During the fourth quarter of 2022, the Company changed the name
of its "Investment Banking" segment to "Investment Banking &
Equities".
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-9 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.
Special Charges, Including Business Realignment Costs, have been
excluded from Adjusted Net Income Attributable to Evercore Inc.
These charges in 2022 relate to charges associated with the
prepayment of the Company's $67 million aggregate principal amount
of its 5.23% Series B senior notes, originally due March 30, 2023
(the "Series B Notes"), as well as certain professional fees,
separation benefits and other charges related to the ongoing
wind-down of the Company's operations in Mexico.
The gain on the sale of a portion of the Company's interests in
ABS in the first quarter of 2022 has been excluded from Adjusted
Net Revenues.
Evercore's Adjusted Diluted Shares Outstanding for the three and
twelve months ended December 31, 2022 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 twelve months ended December
31, 2021 are included in pages A-2 to A-9.
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
Twelve Months Ended
December 31, 2022
December 31, 2021
% Change
December 31, 2022
December 31, 2021
%
Change
(dollars in thousands)
Investment Banking & Equities:
Advisory Fees
$
703,957
$
970,927
(27
%)
$
2,392,990
$
2,751,992
(13
%)
Underwriting Fees
44,077
65,019
(32
%)
122,596
246,705
(50
%)
Commissions and Related Revenue
53,624
54,808
(2
%)
206,207
205,822
—
%
Investment Management:
Asset Management and Administration
Fees
15,759
17,692
(11
%)
64,483
65,784
(2
%)
Other Revenue, net
13,923
7,323
90
%
(24,228
)
19,196
NM
Net Revenues
$
831,340
$
1,115,769
(25
%)
$
2,762,048
$
3,289,499
(16
%)
Three Months Ended
Twelve Months Ended
December 31, 2022
December 31, 2021
% Change
December 31, 2022
December 31, 2021
%
Change
Total Number of Fees from Advisory Client
Transactions(1)
279
320
(13
%)
651
797
(18
%)
Total Number of Fees of at Least $1
million from Advisory Client Transactions(1)
124
153
(19
%)
409
502
(19
%)
Total Number of Underwriting
Transactions(2)
15
23
(35
%)
49
117
(58
%)
Total Number of Underwriting Transactions
as a Bookrunner(2)
15
21
(29
%)
44
100
(56
%)
1.
Includes Advisory and
Underwriting Transactions.
2.
Includes Equity and Debt
Underwriting Transactions.
As of December 31,
2022
2021
% Change
Assets Under Management ($ mm)(1)
Wealth Management(2)
$
10,537
$
12,184
(14
%)
Total Assets Under Management
$
10,537
$
12,184
(14
%)
1.
Assets Under Management reflect
end of period amounts from our consolidated Wealth Management
business.
2.
Assets Under Management includes
Evercore assets which are managed by Evercore Wealth Management of
$0.3 million and $76.3 million as of December 31, 2022 and 2021,
respectively.
Advisory Fees – Fourth quarter Advisory Fees decreased
$267.0 million, or 27%, year-over-year, reflecting a decrease in
the number of Advisory fees earned and a decline in revenue earned
from large transactions during the fourth quarter of 2022. Full
year Advisory Fees decreased $359.0 million, or 13%,
year-over-year, reflecting a decrease in the number of Advisory
fees earned.
Underwriting Fees – Fourth quarter Underwriting Fees
decreased $20.9 million, or 32%, year-over-year, and full year
Underwriting Fees decreased $124.1 million, or 50%, year-over-year.
The decrease principally reflects a decrease in the number of
transactions we participated in due to the decline in overall
market issuances.
Commissions and Related Revenue – Fourth quarter
Commissions and Related Revenue decreased $1.2 million, or 2%,
year-over-year, primarily reflecting lower trading volumes,
partially offset by increased revenues from research subscriptions.
Full year Commissions and Related Revenue increased $0.4 million
year-over-year, primarily reflecting increased revenues from
research subscriptions, partially offset by lower trading
volumes.
Asset Management and Administration Fees – Fourth quarter
Asset Management and Administration Fees decreased $1.9 million, or
11%, year-over-year, driven by a decrease in fees from Wealth
Management clients, as associated AUM decreased 14%, primarily from
market depreciation. Full year Asset Management and Administration
Fees decreased $1.3 million, or 2%, year-over-year, driven by a
decrease in fees from Wealth Management clients, as associated AUM
decreased 14%, primarily from market depreciation.
Other Revenue – Fourth quarter Other Revenue, net,
increased $6.6 million, or 90%, year-over-year, primarily
reflecting higher gains in our fixed income investment portfolios,
which primarily consist of U.S. treasury bills, and higher interest
income, partially offset by lower performance of our investment
funds portfolio due to the overall market decline. The investment
funds portfolio is used as an economic hedge against our deferred
cash compensation program. Full year Other Revenue, net, decreased
$43.4 million year-over-year, primarily reflecting a shift from
gains of $29.0 million in 2021 to losses of $29.8 million in 2022
on our investment funds portfolio due to the overall market
decline. The decrease was also driven by a $4.4 million gain on the
redemption of the G5 debt security in 2021. This was partially
offset by higher gains in our fixed income investment portfolios
and higher interest income, as well as a $1.3 million gain on the
sale of a portion of our interests in ABS during 2022.
Expenses
U.S. GAAP
Three Months Ended
Twelve Months Ended
December 31, 2022
December 31, 2021
% Change
December 31, 2022
December 31, 2021
%
Change
(dollars in thousands)
Employee Compensation and Benefits
$
523,019
$
559,098
(6
%)
$
1,697,519
$
1,848,757
(8
%)
Compensation Ratio
62.9
%
50.1
%
61.5
%
56.2
%
Non-Compensation Costs
$
95,630
$
100,607
(5
%)
$
365,361
$
329,750
11
%
Non-Compensation Ratio
11.5
%
9.0
%
13.2
%
10.0
%
Special Charges, Including Business
Realignment Costs
$
2,594
$
—
NM
$
3,126
$
8,554
(63
%)
Employee Compensation and Benefits – Fourth quarter
Employee Compensation and Benefits decreased $36.1 million, or 6%,
year-over-year, reflecting a compensation ratio of 62.9% for the
quarter versus 50.1% for the prior year period. The decrease in
Employee Compensation and Benefits compared to the prior year
period principally reflects a lower accrual for incentive
compensation, partially offset by higher base salaries and higher
amortization of prior period deferred compensation awards. Full
year Employee Compensation and Benefits decreased $151.2 million,
or 8%, year-over-year, reflecting a full year compensation ratio of
61.5% versus 56.2% for the prior year period. The decrease in
Employee Compensation and Benefits compared to the prior year
period principally reflects a lower accrual for incentive
compensation, partially offset by higher base salaries and higher
amortization of prior period deferred compensation awards. The
Compensation Ratio was also impacted by the lower performance of
our investment funds portfolio during the current year period. See
"Deferred Compensation" for more information.
Non-Compensation Costs – Fourth quarter Non-Compensation
Costs decreased $5.0 million, or 5%, year-over-year, primarily
driven by a decrease in other operating expenses related to
charitable contributions made to the Evercore Foundation in 2021,
partially offset by an increase in travel and related expenses, as
travel began to resume during the fourth quarter of 2021 and
increased throughout 2022. The fourth quarter Non-Compensation
ratio of 11.5% increased from 9.0% for the prior year period. Full
year Non-Compensation Costs increased $35.6 million, or 11%,
year-over-year, primarily driven by an increase in travel and
related expenses, as travel began to resume during the fourth
quarter of 2021 and increased throughout 2022, as well as an
increase in professional fees and bad debt expense. This was
partially offset by a decline in the fair value of contingent
consideration owed to former equity interest holders in our RECA
business, as well as charitable contributions made to the Evercore
Foundation in 2021. The full year Non-Compensation ratio of 13.2%
increased from 10.0% for the prior year period.
Special Charges, Including Business Realignment Costs –
Fourth quarter Special Charges, Including Business Realignment
Costs, relate to separation benefits and other charges related to
the ongoing wind-down of the Company's operations in Mexico. Full
year 2022 Special Charges, Including Business Realignment Costs,
relate to charges associated with the prepayment of the Company's
Series B Notes during the second quarter, as well as certain
professional fees, separation benefits and other charges related to
the ongoing wind-down of the Company's operations in Mexico.
Full year 2021 Special Charges, Including Business Realignment
Costs, relate to the write-down of certain assets associated with a
legacy private equity investment relationship which, consistent
with the Company's investment strategy, the Company decided to wind
down during the third quarter of 2021.
Effective Tax Rate
The fourth quarter effective tax rate was 27.7% versus 23.9% for
the prior year period. The full year effective tax rate was 24.5%
versus 22.2% for the prior year period. The effective tax rate in
2022 reflects higher state and local taxes and a lower amount of
earnings allocated to noncontrolling interest holders. The full
year provision for income taxes for 2022 reflects an additional tax
benefit of $19.6 million versus $18.7 million for the prior year
period, due to the net impact associated with the appreciation or
depreciation in our share price upon vesting of employee
share-based awards above or below 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-9 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
Twelve Months Ended
December 31, 2022
December 31, 2021
% Change
December 31, 2022
December 31, 2021
%
Change
(dollars in thousands)
Investment Banking & Equities:
Advisory Fees(1)
$
704,185
$
970,982
(27
%)
$
2,394,207
$
2,753,329
(13
%)
Underwriting Fees
44,077
65,019
(32
%)
122,596
246,705
(50
%)
Commissions and Related Revenue
53,624
54,808
(2
%)
206,207
205,822
—
%
Investment Management:
Asset Management and Administration
Fees(2)
16,717
21,699
(23
%)
71,265
78,608
(9
%)
Other Revenue, net
18,077
11,640
55
%
(8,672
)
32,408
NM
Net Revenues
$
836,680
$
1,124,148
(26
%)
$
2,785,603
$
3,316,872
(16
%)
1.
Advisory Fees on an Adjusted
basis reflect the reclassification of earnings related to our
equity method investments in Luminis and Seneca Evercore of $0.2
million and $1.2 million for the three and twelve months ended
December 31, 2022, respectively, and $0.1 million and $1.3 million
for the three and twelve months ended December 31, 2021,
respectively.
2.
Asset Management and
Administration Fees on an Adjusted basis reflect the
reclassification of earnings related to our equity method
investments in Atalanta Sosnoff and ABS of $1.0 million and $6.8
million for the three and twelve months ended December 31, 2022,
respectively, and $4.0 million and $12.8 million for the three and
twelve months ended December 31, 2021, respectively.
See page 4 for additional business metrics.
Advisory Fees – Fourth quarter adjusted Advisory Fees
decreased $266.8 million, or 27%, year-over-year, reflecting a
decrease in the number of Advisory fees earned and a decline in
revenue earned from large transactions during the fourth quarter of
2022. Full year adjusted Advisory Fees decreased $359.1 million, or
13%, year-over-year, reflecting a decrease in the number of
Advisory fees earned.
Underwriting Fees – Fourth quarter Underwriting Fees
decreased $20.9 million, or 32%, year-over-year, and full year
Underwriting Fees decreased $124.1 million, or 50%, year-over-year.
The decrease principally reflects a decrease in the number of
transactions we participated in due to the decline in overall
market issuances.
Commissions and Related Revenue – Fourth quarter
Commissions and Related Revenue decreased $1.2 million, or 2%,
year-over-year, primarily reflecting lower trading volumes,
partially offset by increased revenues from research subscriptions.
Full year Commissions and Related Revenue increased $0.4 million
year-over-year, primarily reflecting increased revenues from
research subscriptions, partially offset by lower trading
volumes.
Asset Management and Administration Fees – Fourth quarter
adjusted Asset Management and Administration Fees decreased $5.0
million, or 23%, year-over-year, primarily attributed to a 76%
decrease in equity in earnings of affiliates, primarily driven by
lower income earned by ABS, principally reflecting a decrease in
our ownership following the sale of a portion of our interests
during the first quarter of 2022. The decrease was also driven by a
decrease in fees from Wealth Management clients, as associated AUM
decreased 14%, primarily from market depreciation. Full year
adjusted Asset Management and Administration Fees decreased $7.3
million, or 9%, year-over-year, primarily attributed to a 47%
decrease in equity in earnings of affiliates, driven by lower
income earned by ABS, principally reflecting a decrease in our
ownership following the sale of a portion of our interests during
the first quarter of 2022. The decrease was also driven by a
decrease in fees from Wealth Management clients, as associated AUM
decreased 14%, primarily from market depreciation.
Other Revenue – Fourth quarter adjusted Other Revenue,
net, increased $6.4 million, or 55%, year-over-year, primarily
reflecting higher gains in our fixed income investment portfolios,
which primarily consist of U.S. treasury bills, and higher interest
income, partially offset by lower performance of our investment
funds portfolio due to the overall market decline. The investment
funds portfolio is used as an economic hedge against our deferred
cash compensation program. Full year adjusted Other Revenue, net,
decreased $41.1 million year-over-year, primarily reflecting a
shift from gains of $29.0 million in 2021 to losses of $29.8
million in 2022 on our investment funds portfolio due to the
overall market decline. This was partially offset by higher gains
in our fixed income investment portfolios and higher interest
income.
Adjusted Expenses
Adjusted
Three Months Ended
Twelve Months Ended
December 31, 2022
December 31, 2021
% Change
December 31, 2022
December 31, 2021
%
Change
(dollars in thousands)
Employee Compensation and Benefits
$
523,019
$
559,098
(6
%)
$
1,697,519
$
1,848,757
(8
%)
Compensation Ratio
62.5
%
49.7
%
60.9
%
55.7
%
Non-Compensation Costs
$
95,630
$
100,607
(5
%)
$
365,361
$
329,743
11
%
Non-Compensation Ratio
11.4
%
8.9
%
13.1
%
9.9
%
Employee Compensation and Benefits – Fourth quarter
adjusted Employee Compensation and Benefits decreased $36.1
million, or 6%, year-over-year, reflecting an adjusted compensation
ratio of 62.5% for the quarter versus 49.7% for the prior year
period. The decrease in Employee Compensation and Benefits compared
to the prior year period principally reflects a lower accrual for
incentive compensation, partially offset by higher base salaries
and higher amortization of prior period deferred compensation
awards. Full year adjusted Employee Compensation and Benefits
decreased $151.2 million, or 8%, year-over-year, reflecting a full
year adjusted compensation ratio of 60.9% versus 55.7% for the
prior year period. The decrease in Employee Compensation and
Benefits compared to the prior year period principally reflects a
lower accrual for incentive compensation, partially offset by
higher base salaries and higher amortization of prior period
deferred compensation awards. The adjusted Compensation Ratio was
also impacted by the lower performance of our investment funds
portfolio during the current year period. See "Deferred
Compensation" for more information.
Non-Compensation Costs – Fourth quarter adjusted
Non-Compensation Costs decreased $5.0 million, or 5%,
year-over-year, primarily driven by a decrease in other operating
expenses related to charitable contributions made to the Evercore
Foundation in 2021, partially offset by an increase in travel and
related expenses, as travel began to resume during the fourth
quarter of 2021 and increased throughout 2022. The fourth quarter
adjusted Non-Compensation ratio of 11.4% increased from 8.9% for
the prior year period. Full year adjusted Non-Compensation Costs
increased $35.6 million, or 11%, year-over-year, primarily driven
by an increase in travel and related expenses, as travel began to
resume during the fourth quarter of 2021 and increased throughout
2022, as well as an increase in professional fees and bad debt
expense. This was partially offset by a decline in the fair value
of contingent consideration owed to former equity interest holders
in our RECA business, as well as charitable contributions made to
the Evercore Foundation in 2021. The full year adjusted
Non-Compensation ratio of 13.1% increased from 9.9% for the prior
year period.
Adjusted Effective Tax Rate
The fourth quarter adjusted effective tax rate was 28.2% versus
25.2% for the prior year period. The full year adjusted effective
tax rate was 24.5% versus 23.8% for the prior year period. The
adjusted effective tax rate in 2022 reflects higher state and local
taxes and an increase in non-deductible expenses. The full year
adjusted provision for income taxes for 2022 reflects an additional
tax benefit of $20.2 million versus $19.5 million for the prior
year period, due to the net impact associated with the appreciation
or depreciation in our share price upon vesting of employee
share-based awards above or below the original grant price.
Liquidity
The Company continues to maintain a strong balance sheet. As of
December 31, 2022, cash and cash equivalents were $663.4 million,
investment securities and certificates of deposit were $1.4 billion
and current assets exceeded current liabilities by $1.6 billion.
Amounts due related to the Notes Payable were $371.8 million at
December 31, 2022.
Headcount
As of December 31, 2022 and 2021, the Company employed
approximately 2,120 and 1,950 people, respectively, worldwide.
As of December 31, 2022 and 2021, the Company employed 169(1)
and 154(2) total Senior Managing Directors, respectively, in its
Investment Banking & Equities segment, of which 130(1) and
114(2), respectively, were Advisory Senior Managing Directors.
(1)
Senior Managing Director
headcount as of December 31, 2022, adjusted to include one
additional Advisory Senior Managing Director committed to join in
the first quarter of 2023.
(2)
Senior Managing Director
headcount as of December 31, 2021, adjusted to include two
additional Advisory Senior Managing Directors that joined in the
first quarter of 2022.
Deferred Compensation
During 2022, the Company granted to certain employees
approximately 3.0 million unvested restricted stock units ("RSUs")
(including 2.5 million granted in conjunction with the 2021 bonus
awards) with a grant date fair value of approximately $368.6
million.
In addition, during the first quarter of 2022, the Company
granted approximately $124 million of deferred cash awards to
certain employees, related to our deferred cash compensation
program, principally pursuant to 2021 bonus awards.
The Company recognized compensation expense related to RSUs and
our deferred cash compensation program of $87.8 million and $369.4
million for the three and twelve months ended December 31, 2022,
respectively, and $82.4 million and $344.5 million for the three
and twelve months ended December 31, 2021, respectively.
As of December 31, 2022, the Company had approximately 5.7
million unvested RSUs with an aggregate grant date fair value of
$644.3 million. RSUs are expensed over the service period of the
award, subject to retirement eligibility, and generally vest over
four years.
As of December 31, 2022, the Company expects to pay an aggregate
of $304.3 million related to our deferred cash compensation program
at various dates through 2026, 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.
Capital Return
Transactions
On January 31, 2023, the Board of Directors of Evercore declared
a quarterly dividend of $0.72 per share to be paid on March 10,
2023 to common stockholders of record on February 24, 2023.
During the fourth quarter, the Company repurchased 23 thousand
shares from employees for the net settlement of stock-based
compensation awards at an average price per share of $109.92, and
0.5 million shares at an average price per share of $109.99 in open
market transactions pursuant to the Company's share repurchase
program. The aggregate 0.5 million shares were acquired at an
average price per share of $109.99. During 2022, 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 $127.02, and 3.4 million shares at an average price
per share of $114.39 in open market transactions pursuant to the
Company's share repurchase program. The aggregate 4.4 million
shares were acquired at an average price per share of $117.27.
Conference Call
Evercore will host a related conference call beginning at 8:00
a.m. Eastern Time, Wednesday, February 1, 2023, accessible via
telephone and the Internet. Investors and analysts may participate
in the live conference call by dialing (800) 245-3047 (toll-free
domestic) or (203) 518-9765 (international); passcode: EVRQ422.
Please register at least 10 minutes before the conference call
begins.
A live audio webcast of the conference call will be available on
the For Investors section of Evercore’s website at
www.evercore.com. The webcast will be archived on Evercore’s
website for 30 days after the call.
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, 2021, 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 TWELVE MONTHS ENDED
DECEMBER 31, 2022 AND 2021
(dollars in thousands, except per
share data)
(UNAUDITED)
Three Months Ended December
31,
Twelve Months Ended December
31,
2022
2021
2022
2021
Revenues
Investment Banking & Equities:
Advisory Fees
$
703,957
$
970,927
$
2,392,990
$
2,751,992
Underwriting Fees
44,077
65,019
122,596
246,705
Commissions and Related Revenue
53,624
54,808
206,207
205,822
Asset Management and Administration
Fees
15,759
17,692
64,483
65,784
Other Revenue, Including Interest and
Investments
18,077
11,640
(7,378
)
36,782
Total Revenues
835,494
1,120,086
2,778,898
3,307,085
Interest Expense(1)
4,154
4,317
16,850
17,586
Net Revenues
831,340
1,115,769
2,762,048
3,289,499
Expenses
Employee Compensation and Benefits
523,019
559,098
1,697,519
1,848,757
Occupancy and Equipment Rental
19,972
18,474
78,437
73,887
Professional Fees
27,081
28,429
108,288
96,288
Travel and Related Expenses
14,709
9,577
50,183
21,479
Communications and Information
Services
16,897
15,584
62,642
57,775
Depreciation and Amortization
6,941
7,185
27,713
28,099
Execution, Clearing and Custody Fees
2,539
2,639
10,345
11,588
Special Charges, Including Business
Realignment Costs
2,594
—
3,126
8,554
Acquisition and Transition Costs
—
—
—
7
Other Operating Expenses
7,491
18,719
27,753
40,627
Total Expenses
621,243
659,705
2,066,006
2,187,061
Income Before Income from Equity Method
Investments and Income Taxes
210,097
456,064
696,042
1,102,438
Income from Equity Method Investments
1,186
4,062
7,999
14,161
Income Before Income Taxes
211,283
460,126
704,041
1,116,599
Provision for Income Taxes
58,492
110,155
172,626
248,026
Net Income
152,791
349,971
531,415
868,573
Net Income Attributable to Noncontrolling
Interest
12,352
54,111
54,895
128,457
Net Income Attributable to Evercore
Inc.
$
140,439
$
295,860
$
476,520
$
740,116
Net Income Attributable to Evercore
Inc. Common Shareholders
$
140,439
$
295,860
$
476,520
$
740,116
Weighted Average Shares of Class A
Common Stock Outstanding:
Basic
38,777
38,756
39,224
40,054
Diluted
40,841
42,507
41,037
43,321
Net Income Per Share Attributable to
Evercore Inc. Common Shareholders:
Basic
$
3.62
$
7.63
$
12.15
$
18.48
Diluted
$
3.44
$
6.96
$
11.61
$
17.08
(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, as well as 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:
- Assumed Exchange of Evercore LP Units
into Class A Shares. The Adjusted results assume
substantially all Evercore LP Units have been exchanged for Class A
shares. Accordingly, the noncontrolling interest related to these
units is converted to a controlling interest. The Company's
management believes that it is useful to provide the per-share
effect associated with the assumed conversion of substantially all
of these previously granted equity interests and IPO related
restricted stock units, and thus the Adjusted results reflect their
exchange into Class A shares.
- Adjustments Associated with Business
Combinations and Divestitures. The following charges
resulting from business combinations and divestitures have been
excluded from the Adjusted results because the Company's Management
believes that operating performance is more comparable across
periods excluding the effects of these acquisition-related charges:
- Acquisition and Transition Costs.
Primarily professional fees incurred and costs related to
transitioning acquisitions or divestitures.
- Gain on Sale of Interests in ABS.
The gain on the sale of a portion of the Company's interests in ABS
in the first quarter of 2022 is excluded from the Adjusted
presentation.
- Gain on Redemption of G5 Debt
Security. The gain on the redemption of the G5 debt security
in the second quarter of 2021 is excluded from the Adjusted
presentation.
- Special Charges, Including Business
Realignment Costs. Expenses during 2022 that are excluded
from the Adjusted presentation relate to charges associated with
the prepayment of the Company's Series B Notes during the second
quarter, as well as certain professional fees, separation benefits
and other charges related to the ongoing wind-down of the Company's
operations in Mexico. Expenses during 2021 that are excluded from
the Adjusted presentation relate to the write-down of certain
assets associated with a legacy private equity investment
relationship which, consistent with the Company's investment
strategy, the Company decided to wind down during the third
quarter.
- Income Taxes. 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.
- Presentation of Interest Expense.
The Adjusted results present Adjusted Investment Banking &
Equities Operating Income before interest expense on debt, which is
included in interest expense on a U.S. GAAP basis.
- Presentation of Income from Equity Method
Investments. The Adjusted results present Income from Equity
Method Investments within Revenue as the Company's Management
believes it is a useful presentation.
EVERCORE INC.
U.S. GAAP RECONCILIATION TO
ADJUSTED RESULTS
(dollars in thousands, except per
share data)
(UNAUDITED)
Three Months Ended
Twelve Months Ended
December 31, 2022
December 31, 2021
December 31, 2022
December 31, 2021
Net Revenues - U.S. GAAP
$
831,340
$
1,115,769
$
2,762,048
$
3,289,499
Income from Equity Method Investments
(1)
1,186
4,062
7,999
14,161
Interest Expense on Debt (2)
4,154
4,317
16,850
17,586
Gain on Sale of Interests in ABS (3)
—
—
(1,294
)
—
Gain on Redemption of G5 Debt Security
(4)
—
—
—
(4,374
)
Net Revenues - Adjusted
$
836,680
$
1,124,148
$
2,785,603
$
3,316,872
Other Revenue, net - U.S. GAAP
$
13,923
$
7,323
$
(24,228
)
$
19,196
Interest Expense on Debt (2)
4,154
4,317
16,850
17,586
Gain on Sale of Interests in ABS (3)
—
—
(1,294
)
—
Gain on Redemption of G5 Debt Security
(4)
—
—
—
(4,374
)
Other Revenue, net - Adjusted
$
18,077
$
11,640
$
(8,672
)
$
32,408
Operating Income - U.S. GAAP
$
210,097
$
456,064
$
696,042
$
1,102,438
Income from Equity Method Investments
(1)
1,186
4,062
7,999
14,161
Pre-Tax Income - U.S. GAAP
211,283
460,126
704,041
1,116,599
Gain on Sale of Interests in ABS (3)
—
—
(1,294
)
—
Gain on Redemption of G5 Debt Security
(4)
—
—
—
(4,374
)
Special Charges, Including Business
Realignment Costs (5)
2,594
—
3,126
8,554
Acquisition and Transition Costs (6)
—
—
—
7
Pre-Tax Income - Adjusted
213,877
460,126
705,873
1,120,786
Interest Expense on Debt (2)
4,154
4,317
16,850
17,586
Operating Income - Adjusted
$
218,031
$
464,443
$
722,723
$
1,138,372
Provision for Income Taxes - U.S.
GAAP
$
58,492
$
110,155
$
172,626
$
248,026
Income Taxes (7)
1,913
5,918
108
18,602
Provision for Income Taxes -
Adjusted
$
60,405
$
116,073
$
172,734
$
266,628
Net Income Attributable to Evercore
Inc. - U.S. GAAP
$
140,439
$
295,860
$
476,520
$
740,116
Gain on Sale of Interests in ABS (3)
—
—
(1,294
)
—
Gain on Redemption of G5 Debt Security
(4)
—
—
—
(4,374
)
Special Charges, Including Business
Realignment Costs (5)
2,594
—
3,126
8,554
Acquisition and Transition Costs (6)
—
—
—
7
Income Taxes (7)
(1,913
)
(5,918
)
(108
)
(18,602
)
Noncontrolling Interest (8)
11,307
48,373
50,502
117,484
Net Income Attributable to Evercore
Inc. - Adjusted
$
152,427
$
338,315
$
528,746
$
843,185
Diluted Shares Outstanding - U.S.
GAAP
40,841
42,507
41,037
43,321
LP Units (9)
2,649
4,802
2,970
4,854
Unvested Restricted Stock Units - Event
Based (9)
12
12
12
12
Diluted Shares Outstanding -
Adjusted
43,502
47,321
44,019
48,187
Key Metrics: (a)
Diluted Earnings Per Share - U.S. GAAP
$
3.44
$
6.96
$
11.61
$
17.08
Diluted Earnings Per Share - Adjusted
$
3.50
$
7.15
$
12.01
$
17.50
Operating Margin - U.S. GAAP
25.3
%
40.9
%
25.2
%
33.5
%
Operating Margin - Adjusted
26.1
%
41.3
%
25.9
%
34.3
%
Effective Tax Rate - U.S. GAAP
27.7
%
23.9
%
24.5
%
22.2
%
Effective Tax Rate - Adjusted
28.2
%
25.2
%
24.5
%
23.8
%
(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 TWELVE
MONTHS ENDED DECEMBER 31, 2022
(dollars in thousands)
(UNAUDITED)
Investment Banking &
Equities Segment
Three Months Ended December
31, 2022
Twelve Months Ended December
31, 2022
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
$
703,957
$
228
(1)
$
704,185
$
2,392,990
$
1,217
(1)
$
2,394,207
Underwriting Fees
44,077
—
44,077
122,596
—
122,596
Commissions and Related Revenue
53,624
—
53,624
206,207
—
206,207
Other Revenue, net
14,398
4,154
(2)
18,552
(25,668
)
16,850
(2)
(8,818
)
Net Revenues
816,056
4,382
820,438
2,696,125
18,067
2,714,192
Expenses:
Employee Compensation and Benefits
513,070
—
513,070
1,658,076
—
1,658,076
Non-Compensation Costs
92,132
—
92,132
351,837
—
351,837
Special Charges, Including Business
Realignment Costs
2,594
(2,594
)
(5)
—
3,126
(3,126
)
(5)
—
Total Expenses
607,796
(2,594
)
605,202
2,013,039
(3,126
)
2,009,913
Operating Income (a)
$
208,260
$
6,976
$
215,236
$
683,086
$
21,193
$
704,279
Compensation Ratio (b)
62.9
%
62.5
%
61.5
%
61.1
%
Operating Margin (b)
25.5
%
26.2
%
25.3
%
25.9
%
Investment Management
Segment
Three Months Ended December
31, 2022
Twelve Months Ended December
31, 2022
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
$
15,759
$
958
(1)
$
16,717
$
64,483
$
6,782
(1)
$
71,265
Other Revenue, net
(475
)
—
(475
)
1,440
(1,294
)
(3)
146
Net Revenues
15,284
958
16,242
65,923
5,488
71,411
Expenses:
Employee Compensation and Benefits
9,949
—
9,949
39,443
—
39,443
Non-Compensation Costs
3,498
—
3,498
13,524
—
13,524
Total Expenses
13,447
—
13,447
52,967
—
52,967
Operating Income (a)
$
1,837
$
958
$
2,795
$
12,956
$
5,488
$
18,444
Compensation Ratio (b)
65.1
%
61.3
%
59.8
%
55.2
%
Operating Margin (b)
12.0
%
17.2
%
19.7
%
25.8
%
(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 TWELVE
MONTHS ENDED DECEMBER 31, 2021
(dollars in thousands)
(UNAUDITED)
Investment Banking &
Equities Segment
Three Months Ended December
31, 2021
Twelve Months Ended December
31, 2021
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
$
970,927
$
55
(1)
$
970,982
$
2,751,992
$
1,337
(1)
$
2,753,329
Underwriting Fees
65,019
—
65,019
246,705
—
246,705
Commissions and Related Revenue
54,808
—
54,808
205,822
—
205,822
Other Revenue, net
8,112
4,317
(2)
12,429
19,370
13,212
(2)(4)
32,582
Net Revenues
1,098,866
4,372
1,103,238
3,223,889
14,549
3,238,438
Expenses:
Employee Compensation and Benefits
548,351
—
548,351
1,809,414
—
1,809,414
Non-Compensation Costs
96,557
—
96,557
316,464
(7
)
(6)
316,457
Total Expenses
644,908
—
644,908
2,125,878
(7
)
2,125,871
Operating Income (a)
$
453,958
$
4,372
$
458,330
$
1,098,011
$
14,556
$
1,112,567
Compensation Ratio (b)
49.9
%
49.7
%
56.1
%
55.9
%
Operating Margin (b)
41.3
%
41.5
%
34.1
%
34.4
%
Investment Management
Segment
Three Months Ended December
31, 2021
Twelve Months Ended December
31, 2021
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
$
17,692
$
4,007
(1)
$
21,699
$
65,784
$
12,824
(1)
$
78,608
Other Revenue, net
(789
)
—
(789
)
(174
)
—
(174
)
Net Revenues
16,903
4,007
20,910
65,610
12,824
78,434
Expenses:
Employee Compensation and Benefits
10,747
—
10,747
39,343
—
39,343
Non-Compensation Costs
4,050
—
4,050
13,286
—
13,286
Special Charges, Including Business
Realignment Costs
—
—
—
8,554
(8,554
)
(5)
—
Total Expenses
14,797
—
14,797
61,183
(8,554
)
52,629
Operating Income (a)
$
2,106
$
4,007
$
6,113
$
4,427
$
21,378
$
25,805
Compensation Ratio (b)
63.6
%
51.4
%
60.0
%
50.2
%
Operating Margin (b)
12.5
%
29.2
%
6.7
%
32.9
%
(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 December
31,
Twelve Months Ended December
31,
2022
2021
2022
2021
Investment Banking &
Equities
Net Revenues:
Investment Banking & Equities:
Advisory Fees
$
703,957
$
970,927
$
2,392,990
$
2,751,992
Underwriting Fees
44,077
65,019
122,596
246,705
Commissions and Related Revenue
53,624
54,808
206,207
205,822
Other Revenue, net
14,398
8,112
(25,668
)
19,370
Net Revenues
816,056
1,098,866
2,696,125
3,223,889
Expenses:
Employee Compensation and Benefits
513,070
548,351
1,658,076
1,809,414
Non-Compensation Costs
92,132
96,557
351,837
316,464
Special Charges, Including Business
Realignment Costs
2,594
—
3,126
—
Total Expenses
607,796
644,908
2,013,039
2,125,878
Operating Income (a)
$
208,260
$
453,958
$
683,086
$
1,098,011
Investment Management
Net Revenues:
Asset Management and Administration
Fees
$
15,759
$
17,692
$
64,483
$
65,784
Other Revenue, net
(475
)
(789
)
1,440
(174
)
Net Revenues
15,284
16,903
65,923
65,610
Expenses:
Employee Compensation and Benefits
9,949
10,747
39,443
39,343
Non-Compensation Costs
3,498
4,050
13,524
13,286
Special Charges, Including Business
Realignment Costs
—
—
—
8,554
Total Expenses
13,447
14,797
52,967
61,183
Operating Income (a)
$
1,837
$
2,106
$
12,956
$
4,427
Total
Net Revenues:
Investment Banking & Equities:
Advisory Fees
$
703,957
$
970,927
$
2,392,990
$
2,751,992
Underwriting Fees
44,077
65,019
122,596
246,705
Commissions and Related Revenue
53,624
54,808
206,207
205,822
Asset Management and Administration
Fees
15,759
17,692
64,483
65,784
Other Revenue, net
13,923
7,323
(24,228
)
19,196
Net Revenues
831,340
1,115,769
2,762,048
3,289,499
Expenses:
Employee Compensation and Benefits
523,019
559,098
1,697,519
1,848,757
Non-Compensation Costs
95,630
100,607
365,361
329,750
Special Charges, Including Business
Realignment Costs
2,594
—
3,126
8,554
Total Expenses
621,243
659,705
2,066,006
2,187,061
Operating Income (a)
$
210,097
$
456,064
$
696,042
$
1,102,438
(a) Operating Income excludes Income
(Loss) from Equity Method Investments.
EVERCORE INC.
U.S. GAAP RECONCILIATION TO
ADJUSTED NON-COMPENSATION COSTS
(dollars in thousands)
(UNAUDITED)
Three Months Ended December
31, 2022
U.S. GAAP
Adjustments
Adjusted
(dollars in thousands)
Occupancy and Equipment Rental
$
19,972
$
—
$
19,972
Professional Fees
27,081
—
27,081
Travel and Related Expenses
14,709
—
14,709
Communications and Information
Services
16,897
—
16,897
Depreciation and Amortization
6,941
—
6,941
Execution, Clearing and Custody Fees
2,539
—
2,539
Other Operating Expenses
7,491
—
7,491
Total Non-Compensation Costs
$
95,630
$
—
$
95,630
Three Months Ended December
31, 2021
U.S. GAAP
Adjustments
Adjusted
(dollars in thousands)
Occupancy and Equipment Rental
$
18,474
$
—
$
18,474
Professional Fees
28,429
—
28,429
Travel and Related Expenses
9,577
—
9,577
Communications and Information
Services
15,584
—
15,584
Depreciation and Amortization
7,185
—
7,185
Execution, Clearing and Custody Fees
2,639
—
2,639
Other Operating Expenses
18,719
—
18,719
Total Non-Compensation Costs
$
100,607
$
—
$
100,607
Twelve Months Ended December
31, 2022
U.S. GAAP
Adjustments
Adjusted
(dollars in thousands)
Occupancy and Equipment Rental
$
78,437
$
—
$
78,437
Professional Fees
108,288
—
108,288
Travel and Related Expenses
50,183
—
50,183
Communications and Information
Services
62,642
—
62,642
Depreciation and Amortization
27,713
—
27,713
Execution, Clearing and Custody Fees
10,345
—
10,345
Other Operating Expenses
27,753
—
27,753
Total Non-Compensation Costs
$
365,361
$
—
$
365,361
Twelve Months Ended December
31, 2021
U.S. GAAP
Adjustments
Adjusted
(dollars in thousands)
Occupancy and Equipment Rental
$
73,887
$
—
$
73,887
Professional Fees
96,288
—
96,288
Travel and Related Expenses
21,479
—
21,479
Communications and Information
Services
57,775
—
57,775
Depreciation and Amortization
28,099
—
28,099
Execution, Clearing and Custody Fees
11,588
—
11,588
Acquisition and Transition Costs
7
(7
)
(6)
—
Other Operating Expenses
40,627
—
40,627
Total Non-Compensation Costs
$
329,750
$
(7
)
$
329,743
Notes to Unaudited Condensed Consolidated Adjusted Financial
Data
For further information on these
adjustments, see pages A-2 to A-3.
(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 gain on the sale of a portion of the
Company's interests in ABS in the first quarter of 2022 is excluded
from the Adjusted presentation.
(4)
The gain resulting from the redemption of
the G5 debt security in the second quarter of 2021 is excluded from
the Adjusted presentation.
(5)
Expenses during 2022 that are excluded
from the Adjusted presentation relate to charges associated with
the prepayment of the Company's Series B Notes during the second
quarter, as well as certain professional fees, separation benefits
and other charges related to the ongoing wind-down of the Company's
operations in Mexico. Expenses during 2021 that are excluded from
the Adjusted presentation relate to the write-down of certain
assets associated with a legacy private equity investment
relationship which, consistent with the Company's investment
strategy, the Company decided to wind down during the third
quarter.
(6)
Professional fees incurred and costs
related to transitioning acquisitions or divestitures are excluded
from the Adjusted presentation.
(7)
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.
(8)
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.
(9)
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/20230131005918/en/
Investor Contact: Katy Haber Head of Investor Relations
& ESG InvestorRelations@Evercore.com
Media Contact: Jamie Easton Head of Communications &
External Affairs Communications@Evercore.com
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