– Record Fiscal Year 2018 Revenue of $963 million, up 10%
Year-Over-Year –
–Fiscal Year 2018 Diluted EPS of $2.60, up 60%
Year-Over-Year –
–Adjusted Fiscal Year 2018 Diluted EPS of $2.39, up
26% Year-Over-Year –
– Fourth Quarter Fiscal 2018 Revenue of $245 million, down 5%
Year-Over-Year –
–Fourth Quarter Fiscal 2018 Diluted EPS of $0.58, up
14%Year-Over-Year –
–Adjusted Fourth Quarter Fiscal 2018 Diluted EPS of
$0.65, up 10% Year-Over-Year –
– Increased Dividend 35% to $0.27 per Share for First Quarter
Fiscal 2019 –
LOS ANGELES & NEW YORK--(BUSINESS WIRE)--
Houlihan Lokey, Inc. (NYSE:HLI) (“Houlihan Lokey”, or the “Company”)
today reported financial results for its fiscal year and fourth quarter
ended March 31, 2018. For the fiscal year, total revenue grew 10% to a
fiscal year record of $963 million, compared with $872 million for the
fiscal year ended March 31, 2017. For the fourth quarter ended March 31,
2018, total revenue decreased 5% to $245 million, compared with $257
million for the fourth quarter ended March 31, 2017.
Net income grew 59% to $172 million, or $2.60 per diluted share, for the
fiscal year ended March 31, 2018, compared with $108 million, or $1.63
per diluted share, for the fiscal year ended March 31, 2017. Adjusted
net income for the fiscal year ended March 31, 2018 grew 26% to $159
million, or $2.39 per diluted share, compared with $126 million, or
$1.89 per diluted share, for the fiscal year ended March 31, 2017.
Net income grew 12% to $38 million, or $0.58 per diluted share, for the
fourth quarter ended March 31, 2018, compared with $34 million, or $0.51
per diluted share, for the fourth quarter ended March 31, 2017. Adjusted
net income for the fourth quarter ended March 31, 2018 grew 9% to $43
million, or $0.65 per diluted share, compared with $39 million, or $0.59
per diluted share, for the fourth quarter ended March 31, 2017.
"We are pleased to report another record fiscal year at Houlihan Lokey
resulting in our 6th consecutive year of revenue growth. All three
business segments performed well, and we enter our fiscal year 2019 with
strong momentum in our business. We promoted nine Directors to MD and
hired 20 new MDs in fiscal 2018 which adds considerable talent to our
senior banking staff and positions us well for continued growth. Also,
last month, we completed the acquisition of Quayle Munro. Our management
team is thankful to our employees who helped us achieve record results,
and our investors who supported us throughout the year,” stated Scott
Beiser, Chief Executive Officer of Houlihan Lokey.
|
|
Selected Financial Data
(Unaudited and in thousands, except per share data)
|
|
|
|
| |
| | | | U.S. GAAP |
| | | Three Months Ended
March 31, |
| Twelve Months Ended
March 31, |
| | | 2018 |
| 2017 | | 2018 |
| 2017 |
| Fee revenue | | | | $244,753 | | | $257,100 | | | $963,364 | | | $872,091 |
| Operating expenses: | | | | | | | | | | |
|
Employee compensation and benefits
| | | |
155,519
| | |
170,567
| | |
636,631
| | |
582,244
|
|
Non-compensation expenses
| | | |
29,472
|
| |
29,199
|
| |
112,287
|
| |
107,852
|
|
Total operating expenses
| | | |
184,991
| | |
199,766
| | |
748,918
| | |
690,096
|
|
Operating income
| | | |
59,762
| | |
57,334
| | |
214,446
| | |
181,995
|
|
Other (income) expense, net
| | | |
(1,052
|
)
| |
767
|
| |
(3,390
|
)
| |
3,508
|
|
Income before provision for income taxes
| | | |
60,814
| | |
56,567
| | |
217,836
| | |
178,487
|
|
Provision for income taxes
| | | |
22,715
|
| |
22,491
|
| |
45,553
|
| |
70,144
|
| Net income attributable to Houlihan Lokey, Inc. | | | | $38,099 | | | $34,076 | | | $172,283 | | | $108,343 |
|
Diluted net income per share of common stock
| | | | $0.58 | | | $0.51 | | | $2.60 | | | $1.63 |
| | | | | | | | | | | | |
|
Revenues
For the fiscal year ended March 31, 2018, total fee revenue grew 10% to
$963 million from $872 million for the fiscal year ended March 31, 2017.
For the fiscal year, Corporate Finance (“CF”) revenues increased 22%,
Financial Restructuring (“FR”) revenues decreased 4%, and Financial
Advisory Services (“FAS”) revenues increased 8% when compared with the
fiscal year ended March 31, 2017.
For the fourth quarter ended March 31, 2018, total fee revenue decreased
5% to $245 million from $257 million for the fourth quarter ended
March 31, 2017. For the quarter, CF revenues increased 13%, FR revenues
decreased 25%, and FAS revenues decreased 1% when compared with the
fourth quarter ended March 31, 2017.
Expenses
The Company’s employee compensation and benefits and non-compensation
expenses during the periods presented and described below are on a GAAP,
an adjusted, and an adjusted awarded basis, as appropriate.
|
|
|
|
| |
(Unaudited and in thousands)
| | | | | |
| | | | | Three Months Ended March 31, |
| | | | | U.S. GAAP |
| Adjusted (Non-GAAP)* |
| | | | | 2018 |
| 2017 | | 2018 |
| 2017 |
| Expenses: | | | | | | | | | | | |
|
Employee compensation and benefits
| | | | | $155,519 | | | $170,567 | | | $153,098 | | | $163,825 | |
| % of Revenues | | | | | 63.5 | % | | 66.3 | % | | 62.6 | % | | 63.7 | % |
|
Non-compensation expenses
| | | | | $29,472 | | | $29,199 | | | $27,918 | | | $26,966 | |
| % of Revenues | | | | | 12.0 | % | | 11.4 | % | | 11.4 | % | | 10.5 | % |
|
Total operating expenses
| | | | | $184,991 | | | $199,766 | | | $181,017 | | | $190,791 | |
| % of Revenues | | | | | 75.6 | % | | 77.7 | % | | 74.0 | % | | 74.2 | % |
|
|
|
|
|
|
|
|
|
|
|
|
|
| | | | | | | | | | |
|
|
Adjusted awarded employee compensation and benefits
| | | | | | | | | $157,178 | | | $168,400 | |
| % of Revenues | | | | | | | | |
64.2
|
%
| |
65.5
|
%
|
| | | | | | | | | | | | |
|
|
|
|
|
| |
(Unaudited and in thousands)
| | | | | |
| | | | | Twelve Months Ended March 31, |
| | | | | U.S. GAAP |
| Adjusted (Non-GAAP)* |
| | | | | 2018 |
| 2017 | | 2018 |
| 2017 |
| Expenses: | | | | | | | | | | | |
|
Employee compensation and benefits
| | | | | $636,631 | | | $582,244 | | | $611,714 | | | $556,041 | |
| % of Revenues | | | | | 66.1 | % | | 66.8 | % | | 63.5 | % | | 63.8 | % |
|
Non-compensation expenses
| | | | | $112,287 | | | $107,852 | | | $109,458 | | | $105,619 | |
| % of Revenues | | | | | 11.7 | % | | 12.4 | % | | 11.4 | % | | 12.1 | % |
|
Total operating expenses
| | | | | $748,918 | | | $690,096 | | | $721,172 | | | $661,660 | |
| % of Revenues | | | | | 77.7 | % | | 79.1 | % | | 74.9 | % | | 75.9 | % |
|
|
|
|
|
|
|
|
|
|
|
|
|
| | | | | | | | | | |
|
|
Adjusted awarded employee compensation and benefits
| | | | | | | | | $626,572 | | | $570,300 | |
| % of Revenues | | | | | | | | |
65.0
|
%
| |
65.4
|
%
|
| | | | | | | | | | | | |
|
Note: Figures may not sum due to rounding.
*Note: The adjusted and adjusted awarded figures represent non-GAAP
information. See “Non-GAAP Financial Measures” and the tables at the end
of this release for an explanation of the adjustments and
reconciliations to the comparable GAAP numbers.
Total operating expenses were $749 million for the fiscal year ended
March 31, 2018, an increase of 9% when compared with $690 million in
operating expenses for the fiscal year ended March 31, 2017. Employee
compensation and benefits expenses were $637 million for the fiscal year
ended March 31, 2018, compared with $582 million for the fiscal year
ended March 31, 2017. The increase in employee compensation and benefits
expenses was primarily a result of the growth in revenues for the fiscal
year.
Total adjusted operating expenses were $721 million for the fiscal year
ended March 31, 2018, an increase of 9% when compared with $662 million
in adjusted operating expenses for the fiscal year ended March 31, 2017.
Adjusted employee compensation and benefits expenses were $612 million
for the fiscal year ended March 31, 2018, compared with $556 million for
the fiscal year ended March 31, 2017. The increase in adjusted employee
compensation and benefits expenses was primarily a result of the growth
in revenues for the fiscal year. This resulted in an adjusted
compensation ratio of 63.5% for the fiscal year ended March 31, 2018,
versus 63.8% for the fiscal year ended March 31, 2017.
Non-compensation expenses were $112 million for the fiscal year ended
March 31, 2018, compared with $108 million for the fiscal year ended
March 31, 2017. Non-compensation expenses increased primarily as a
result of higher general operating expenses during the fiscal year ended
March 31, 2018. Adjusted non-compensation expenses were $109 million for
the fiscal year ended March 31, 2018, compared with $106 million for the
fiscal year ended March 31, 2017. The increase in adjusted
non-compensation expenses was primarily a result of higher general
operating expenses during the fiscal year ended March 31, 2018.
The provision/(benefit) for income taxes was $46 million, representing
an effective tax rate of 21% for the fiscal year ended March 31, 2018,
compared with $70 million, representing an effective tax rate of 39% for
the fiscal year ended March 31, 2017. The significant decrease in the
effective tax rate was a result of (i) the Tax Cuts and Jobs Acts (the
"Tax Act") that was enacted into law in December 2017 that resulted in a
lower effective federal tax rate; the re-measurement of deferred tax
assets and liabilities based on the new tax rate; a one-time deemed
repatriation tax on foreign earnings, among other discrete items and
(ii) the positive difference between the price of the stock at the time
of vesting in October 2017 (accelerated from April/May 2018) and our
stock price at the time of grant for the shares that vested. The
adjusted provision for income taxes was $85 million, representing an
adjusted effective tax rate of 35% for the fiscal year ended March 31,
2018, compared with $81 million, representing an adjusted effective tax
rate of 39% for the fiscal year ended March 31, 2017. The decrease in
the adjusted effective tax rate was a result of a lower statutory
federal tax rate per the Tax Act.
Total operating expenses were $185 million for the fourth quarter ended
March 31, 2018, a decrease of 7% when compared with $200 million in
operating expenses for the fourth quarter ended March 31, 2017. Employee
compensation and benefits expenses were $156 million for the fourth
quarter ended March 31, 2018, compared with $171 million for the fourth
quarter ended March 31, 2017. The decrease in employee compensation and
benefits expenses was primarily a result of (i) the decline in revenues
and (ii) a lower compensation ratio in the fourth quarter ended March
31, 2018 compared with the same period last year.
Total adjusted operating expenses were $181 million for the fourth
quarter ended March 31, 2018, a decrease of 5% when compared with $191
million in adjusted operating expenses for the fourth quarter ended
March 31, 2017. Adjusted employee compensation and benefits expenses
were $153 million for the fourth quarter ended March 31, 2018, compared
with $164 million for the fourth quarter ended March 31, 2017. The
decrease in adjusted employee compensation and benefits expenses was
primarily a result of the decline in revenues for the quarter. This
resulted in an adjusted compensation ratio of 62.6% for the fourth
quarter ended March 31, 2018, versus 63.7% for the fourth quarter ended
March 31, 2017.
Non-compensation expenses were $29 million for both the fourth quarter
ended March 31, 2018 and March 31, 2017. Non-compensation expenses
remained flat primarily due to increases in general operating expenses
that were offset by a decline in costs related to the Company's
completed secondary stock offerings quarter-over-quarter. Adjusted
non-compensation expenses were $28 million for the fourth quarter ended
March 31, 2018 and $27 million for the fourth quarter ended March 31,
2017. The slight increase in adjusted non-compensation expenses was
primarily a result of higher general operating expenses during the
fiscal year ended March 31, 2018.
The provision/(benefit) for income taxes was $23 million, representing
an effective tax rate of 37% for the fourth quarter ended March 31,
2018, compared with $22 million, representing an effective tax rate of
40% for the fourth quarter ended March 31, 2017. The adjusted provision
for income taxes was $22 million, representing an adjusted effective tax
rate of 34% for the fourth quarter ended March 31, 2018, compared with
$26 million, representing an adjusted effective tax rate of 40% for the
fourth quarter ended March 31, 2017. The decrease in the adjusted
effective tax rate was a result of a lower statutory federal tax rate
per the Tax Act.
Segment Reporting for the Fourth Quarter
For the fourth quarter ended March 31, 2018, Corporate Finance revenue
grew 13% to $130 million, compared with $115 million during the fourth
quarter ended March 31, 2017. The growth in revenues was driven by an
increase in the average transaction fee per closed transaction offset by
a decline in the number of closed transactions. CF closed 56
transactions in the fourth quarter ended March 31, 2018, versus 62
transactions in the fourth quarter ended March 31, 2017. Segment profit
equaled $48 million for the fourth quarter ended March 31, 2018,
compared with $28 million for the fourth quarter ended March 31, 2017.
Segment profitability increased primarily as a result of lower employee
compensation and benefits as a percentage of revenues when compared to
the same quarter of the prior year.
|
|
|
|
| |
| |
| | | | | Three Months Ended
March 31, | | Twelve Months Ended
March 31, |
| | | | | 2018 |
| 2017 | | 2018 |
| 2017 |
| Corporate Finance | | | | | | | | | | | |
|
Revenues
| | | | | $129,820 | | | $115,075 | | | $528,643 | | | $434,558 |
|
Segment Profit¹
| | | | |
47,886
| | |
28,222
| | |
177,575
| | |
119,739
|
|
# of MDs
| | | | |
92
| | |
87
| | |
92
| | |
87
|
|
# of Closed Transactions
| | | | |
56
| | |
62
| | |
226
| | |
216
|
| | | | | | | | | | | | | |
|
For the fourth quarter ended March 31, 2018, Financial Restructuring
revenue decreased 25% to $78 million, compared with $104 million during
the fourth quarter ended March 31, 2017. FR closed 26 transactions in
the fourth quarter ended March 31, 2018, versus 30 transactions in the
fourth quarter ended March 31, 2017. Segment profit was $22 million for
the fourth quarter ended March 31, 2018, compared with $37 million for
the fourth quarter ended March 31, 2017, a decrease of 40%. The decrease
in profitability was primarily a result of higher employee compensation
and benefits expenses and higher non-compensation expenses as a
percentage of revenues when compared to the same quarter last year.
(Unaudited and $ in thousands)
|
|
|
|
| Three Months Ended
March 31, |
| Twelve Months Ended
March 31, |
| | | | | 2018 |
| 2017 | | 2018 |
| 2017 |
| Financial Restructuring | | | | | | | | | | | |
|
Revenues
| | | | | $77,673 | | | $104,223 | | | $294,142 | | | $307,595 |
|
Segment Profit¹
| | | | |
22,339
| | |
37,289
| | |
73,691
| | |
92,831
|
|
# of MDs
| | | | |
42
| | |
43
| | |
42
| | |
43
|
|
# of Closed Transactions
| | | | |
26
| | |
30
| | |
77
| | |
75
|
| | | | | | | | | | | | | |
|
For the fourth quarter ended March 31, 2018, Financial Advisory Services
revenue decreased 1% to $37 million, compared with $38 million in the
fourth quarter ended March 31, 2017. Segment profit was $6 million for
the fourth quarter ended March 31, 2018, compared with $7 million for
the fourth quarter ended March 31, 2017. Segment profitability decreased
primarily as a result of higher non-compensation expenses when compared
to the same quarter last year.
(Unaudited and $ in thousands)
|
|
|
|
| Three Months Ended
March 31, |
| Twelve Months Ended
March 31, |
| | | | | 2018 |
| 2017 | | 2018 |
| 2017 |
| Financial Advisory Services | | | | | | | | | | | |
|
Revenues
| | | | | $37,260 | | | $37,802 | | | $140,579 | | | $129,938 |
|
Segment Profit¹
| | | | |
5,557
| | |
7,129
| | |
26,334
| | |
28,905
|
|
# of MDs
| | | | |
35
| | |
35
| | |
35
| | |
35
|
|
# of Fee Events2 | | | | |
602
| | |
595
| | |
1,339
| | |
1,236
|
| | | | | | | | | | | | | |
|
|
1.
|
|
We adjust the compensation expense for a business segment in
situations where an employee residing in one business segment is
performing work in another business segment where the revenues are
accrued. We account for the compensation expense in the business
segment where the employee resides.
|
|
2.
| |
A Fee Event includes any engagement that involves revenue activity
during the measurement period based on a revenue minimum of $1,000
(one thousand dollars).
|
| |
|
Balance Sheet and Capital Allocation
The Board of Directors of the Company declared a regular quarterly cash
dividend of $0.27 per share of Class A and Class B common stock. The
dividend will be payable on June 15, 2018 to stockholders of record as
of the close of business on June 4, 2018.
As of March 31, 2018, the Company had $416 million of cash and cash
equivalents and investment securities, and loans payable aggregating $12
million.
Investor Conference Call and Webcast
The Company will host a conference call and live webcast at 5:00 p.m.
Eastern Time on Wednesday, May 9, 2018, to discuss its fourth quarter
fiscal year 2018 results. The number to call is 1-888-394-8218
(domestic) or 1-323-701-0225 (international). A live webcast will be
available in the Investor Relations section of the Company’s website. A
replay of the conference call will be available on May 9, 2018 through
May 16, 2018, by dialing 1-844-512-2921 (domestic) or 1-412-317-6671
(international) and entering the passcode 5061549#. A replay of the
webcast will be archived and available on the Company’s website.
Forward-Looking Statements
This press release contains forward-looking statements within the
meaning of the federal securities laws. You can identify these
statements by our use of the words “assumes,” “believes,” “estimates,”
“expects,” “guidance,” “intends,” “plans,” “projects,” and similar
expressions that do not relate to historical matters. You should
exercise caution in interpreting and relying on forward-looking
statements because they involve known and unknown risks, uncertainties,
and other factors which are, in some cases, beyond the Company’s control
and could materially affect actual results, performance, or
achievements. For a further description of such factors, you should read
the Company’s filings with the Securities and Exchange Commission. The
Company does not undertake any obligation to update or revise any
forward-looking statement, whether as a result of new information,
future events, or otherwise.
Non-GAAP Financial Measures
Adjusted net income, total and on a per share basis, and adjusted
operating expenses are presented and discussed in this earnings press
release and are non-GAAP measures that management believes, when
presented together with comparable GAAP measures, are useful to
investors in understanding the Company’s operating results. Adjusted net
income and adjusted operating expenses remove the significant accounting
impact of one-time charges associated with the Company’s IPO and other
matters, as set forth in the tables at the end of this release.
Adjusted net income and adjusted operating expenses as calculated by the
Company are not necessarily comparable to similarly titled measures
reported by other companies. Additionally, adjusted net income is not a
measurement of financial performance or liquidity under GAAP and should
not be considered as an alternative to the Company’s financial
information determined under GAAP. For a description of the Company’s
use of adjusted net income and a reconciliation with net income, as well
as a reconciliation of the specific line items in adjusted operating
expenses, see the section of this press release titled “Reconciliation
of GAAP to Adjusted Financial Information.” Please refer to our
financial statements, prepared in accordance with GAAP, for purposes of
evaluating our financial condition, results of operations, and cash
flows.
About Houlihan Lokey
Houlihan Lokey (NYSE:HLI) is a global investment bank with expertise in
mergers and acquisitions, capital markets, financial restructuring,
valuation, and strategic consulting. The firm serves corporations,
institutions, and governments worldwide with offices in the United
States, Europe, the Middle East, and the Asia-Pacific region.
Independent advice and intellectual rigor are hallmarks of the firm's
commitment to client success across its advisory services. Houlihan
Lokey is ranked as the No. 1 M&A advisor for all U.S. transactions, the
No. 1 global restructuring advisor, and the No. 1 global M&A fairness
opinion advisor over the past 20 years, according to Thomson Reuters.
For more information, please visit www.HL.com.
Appendix
Consolidated Balance Sheet (Unaudited)
Consolidated Statement of
Income (Unaudited)
Reconciliation of GAAP to Adjusted Financial
Information (Unaudited)
|
|
Houlihan Lokey, Inc. Consolidated Balance Sheet
(In thousands, except share data and par value)
|
|
|
|
| |
| |
| | | | March 31,
2018 | | March 31,
2017 |
| | | |
(unaudited)
| |
(audited)
|
| Assets: | | | | | | |
|
Cash and cash equivalents
| | | | $206,723 | | | $300,314 | |
|
Restricted cash
| | | |
93,500
| | |
192,372
| |
|
Investment securities
| | | |
209,319
| | |
—
| |
|
Accounts receivable, net of allowance for doubtful accounts
| | | |
77,259
| | |
60,718
| |
|
Unbilled work in process
| | | |
45,862
| | |
57,682
| |
|
Receivable from affiliates
| | | |
8,732
| | |
10,913
| |
|
Property and equipment – net of accumulated depreciation
| | | |
32,146
| | |
30,416
| |
| Goodwill and other intangibles
| | | |
723,310
| | |
715,343
| |
|
Other assets
| | | |
21,990
|
| |
17,949
|
|
| Total assets | | | | 1,418,841 |
| | 1,385,707 |
|
| Liabilities and Stockholders' Equity | | | | | | |
| Liabilities: | | | | | | |
|
Accrued salaries and bonuses
| | | |
377,901
| | |
336,465
| |
|
Accounts payable and accrued expenses
| | | |
40,772
| | |
41,655
| |
|
Deferred income
| | | |
3,620
| | |
3,717
| |
|
Income taxes payable
| | | |
9,967
| | |
4,937
| |
|
Deferred income taxes
| | | |
22,180
| | |
31,196
| |
|
Forward repurchase liability
| | | |
93,500
| | |
192,372
| |
|
Loan payable to affiliate
| | | |
—
| | |
15,000
| |
|
Loans payable to former shareholders
| | | |
3,036
| | |
5,482
| |
|
Loan payable to non-affiliate
| | | |
8,825
| | |
12,080
| |
|
Other liabilities
| | | |
6,227
|
| |
12,348
|
|
| Total liabilities | | | | 566,028 |
| | 655,252 |
|
|
Redeemable noncontrolling interest
| | | |
—
| | |
3,838
| |
| | | | | |
|
| Stockholders' equity: | | | | | | |
|
Class A common stock, $0.001 par value. Authorized 1,000,000,000
shares; issued and outstanding 30,604,405 and 22,026,811 shares as
of March 31, 2018 and March 31, 2017, respectively
| | | |
31
| | |
22
| |
|
Class B common stock, $0.001 par value. Authorized 1,000,000,000
shares; issued and outstanding 37,187,932 and 50,883,299 shares as
of March 31, 2018 and March 31, 2017, respectively
| | | |
37
| | |
51
| |
| Treasury stock, at cost; 2,000,000 and 6,900,000 shares as of March
31, 2018, and March 31, 2017, respectively
| | | |
(93,500
|
)
| |
(193,572
|
)
|
|
Additional paid-in capital
| | | |
753,077
| | |
854,750
| |
|
Retained earnings
| | | |
207,124
| | |
87,407
| |
|
Accumulated other comprehensive loss
| | | |
(13,956
|
)
| |
(21,917
|
)
|
|
Stock subscription receivable
| | | |
—
|
| |
(124
|
)
|
| Total stockholders' equity | | | | 852,813 |
|
| 726,617 |
|
| Total liabilities and stockholders' equity | | | | 1,418,841 |
|
| 1,385,707 |
|
| | | | | | | |
|
|
|
Houlihan Lokey, Inc. Consolidated Statement of Income
(Unaudited and in thousands, except share and per share data)
|
|
|
|
| |
| |
| | | | Three Months Ended
March 31, | | Twelve Months Ended
March 31, |
| | | | 2018 |
| 2017 | | 2018 |
| 2017 |
| Fee revenue | | | | $244,753 | | | $257,100 | | | $963,364 | | | $872,091 |
| | | | | | | | | |
|
| Operating expenses: | | | | | | | | | | |
|
Employee compensation and benefits
| | | |
155,519
| | |
170,567
| | |
636,631
| | |
582,244
|
|
Travel, meals, and entertainment
| | | |
6,504
| | |
5,780
| | |
26,445
| | |
21,707
|
|
Rent
| | | |
7,252
| | |
6,346
| | |
28,560
| | |
27,094
|
|
Depreciation and amortization
| | | |
1,785
| | |
1,955
| | |
7,905
| | |
8,853
|
|
Information technology and communications
| | | |
4,815
| | |
4,146
| | |
18,481
| | |
17,628
|
|
Professional fees
| | | |
6,875
| | |
4,859
| | |
17,117
| | |
13,073
|
|
Other operating expenses, net
| | | |
2,241
|
| |
6,113
|
| |
13,779
|
| |
19,497
|
|
Total operating expenses
| | | |
184,991
| | |
199,766
| | |
748,918
| | |
690,096
|
| | | | | | | | | |
|
|
Operating income
| | | |
59,762
| | |
57,334
| | |
214,446
| | |
181,995
|
| | | | | | | | | |
|
|
Other (income) expense, net
| | | |
(1,052
|
)
| |
767
|
| |
(3,390
|
)
| |
3,508
|
|
Income before provision for income taxes
| | | |
60,814
| | |
56,567
| | |
217,836
| | |
178,487
|
| | | | | | | | | |
|
|
Provision for income taxes
| | | |
22,715
|
| |
22,491
|
| |
45,553
|
| |
70,144
|
| Net income attributable to Houlihan Lokey, Inc. | | | | $38,099 | | | $34,076 | | | $172,283 | | | $108,343 |
| | | | | | | | | |
|
|
Weighted average shares of common stock outstanding:
| | | | | | | | | | |
|
Basic
| | | |
62,971,472
| | |
61,584,806
| | |
62,494,275
| | |
61,100,497
|
|
Fully Diluted
| | | |
65,886,277
| | |
66,456,651
| | |
66,324,093
| | |
66,579,130
|
|
Net income per share of common stock:
| | | | | | | | | | |
|
Basic
| | | | $0.61 | | | $0.55 | | | $2.76 | | | $1.77 |
|
Fully Diluted
| | | | $0.58 | | | $0.51 | | | $2.60 | | | $1.63 |
| | | | | | | | | | | | |
|
|
|
Houlihan Lokey, Inc. Reconciliation of GAAP to Adjusted Financial Information
(Unaudited and in thousands, except per share data)
|
|
|
|
| |
| |
| | | | Three Months Ended
March 31, | | Twelve Months Ended
March 31, |
| | | | 2018 |
| 2017 | | 2018 |
| 2017 |
| Fee revenue | | | | $244,753 | | | $257,100 | | | $963,364 | | | $872,091 | |
| | | | | | | | | |
|
| Employee Compensation and Benefits |
|
|
|
|
|
| |
|
|
|
|
Employee Compensation and Benefits (GAAP)
| | | | $155,519 | | | $170,567 | | | $636,631 | | | $582,244 | |
|
Less/Plus: Adjustments1 | | | |
(2,421
|
)
| |
(6,742
|
)
| |
(24,917
|
)
| |
(26,203
|
)
|
|
Employee Compensation and Benefits (Adjusted)
| | | |
153,098
| | |
163,825
| | |
611,714
| | |
556,041
| |
|
Less/Plus: Adjustments2 | | | |
4,080
|
| |
4,575
|
| |
14,858
|
| |
14,259
|
|
|
Employee Compensation and Benefits (Adjusted Awarded)
| | | |
157,178
| | |
168,400
| | |
626,572
| | |
570,300
| |
| | | | | | | | | |
|
| Non-Compensation Expenses |
|
|
|
|
|
|
|
|
|
|
|
Non-Compensation Expenses (GAAP)
| | | | $29,472 | | | $29,199 | | | $112,287 | | | $107,852 | |
|
Less/Plus: Adjustments3 | | | |
(1,554
|
)
| |
(2,233
|
)
| |
(2,829
|
)
| |
(2,233
|
)
|
|
Non-Compensation Expenses (Adjusted)
| | | |
27,918
| | |
26,966
| | |
109,458
| | |
105,619
| |
| | | | | | | | | |
|
| Operating Income |
|
|
|
|
|
| |
|
|
|
|
Operating Income (GAAP)
| | | | $59,762 | | | $57,334 | | | $214,446 | | | $181,995 | |
|
Less/Plus: Adjustments4 | | | |
3,974
|
| |
8,975
|
| |
27,746
|
| |
28,436
|
|
|
Operating Income (Adjusted)
| | | |
63,736
| | |
66,309
| | |
242,192
| | |
210,431
| |
| | | | | | | | | |
|
| Other (Income) Expenses, net |
|
|
|
|
|
| |
|
|
|
|
Other (Income) Expenses, net (GAAP)
| | | |
($1,052 |
)
| | $767 | | |
($3,390 |
)
| | $3,508 | |
|
Less/Plus: Adjustments5 | | | |
—
|
| |
—
|
| |
1,552
|
| |
—
|
|
|
Other (Income) Expenses, net (Adjusted)
| | | |
(1,052
|
)
| |
767
| | |
(1,838
|
)
| |
3,508
| |
| | | | | | | | | |
|
| Provision for Income Taxes |
|
|
|
|
|
| |
|
|
|
|
Provision for Income Taxes (GAAP)
| | | | $22,715 | | | $22,491 | | | $45,553 | | | $70,144 | |
|
Less/Plus: Adjustments6 | | | |
(955
|
)
| |
3,568
|
| |
39,812
|
| |
11,177
|
|
|
Provision for Income Taxes (Adjusted)
| | | |
21,760
| | |
26,059
| | |
85,365
| | |
81,321
| |
| | | | | | | | | |
|
| Net Income |
|
|
|
|
|
| |
|
|
|
|
Net Income (GAAP)
| | | | $38,099 | | | $34,076 | | | $172,283 | | | $108,343 | |
|
Less/Plus: Adjustments7 | | | |
4,929
|
| |
5,407
|
| |
(13,618
|
)
| |
17,259
|
|
|
Net Income (Adjusted)
| | | |
43,028
| | |
39,483
| | |
158,665
| | |
125,602
| |
| | | |
| |
| |
| |
|
|
Diluted adjusted net income per share of common stock
| | | | $0.65 | | | $0.59 | | | $2.39 | | | $1.89 | |
| | | | | | | | | | | | | |
|
|
____________________________
|
|
Note: Figures may not sum due to rounding.
|
|
1.
|
|
Consists of pre-IPO grant vesting, including grants re-awarded
following forfeiture, if any.
|
|
2.
| |
Reflects (i) the expected vesting of grants that were made in prior
year periods that were expensed during the period plus any unvested
grants that were forfeited during the period (($1,798) in Q4 FY18;
($9,209) in Q4 FY17; ($32,301) in FY18; ($27,794) in FY17), and (ii)
estimated normal year-end grants of deferred stock during the period
($5,878 in Q4 FY18; $13,784 in Q4 FY17; $47,159 in FY18; $42,053 in
FY17).
|
|
3.
| |
Includes costs associated with Houlihan Lokey's secondary offering
of stock (($809) in Q4 FY18; ($1,633) in Q4 FY17; ($2,084) in FY18;
($1,633) in FY17) and completed acquisitions (($744) in Q4 FY18 and
FY18; ($600) in Q4 FY17 and FY17).
|
|
4.
| |
Includes pre-IPO grant vesting, including grants re-awarded
following forfeiture, if any, plus costs associated with Houlihan
Lokey's secondary offering of stock and completed acquisitions.
|
|
5.
| |
Includes (i) the net gain from the acquisition of the remaining
outstanding equity stake of the Australia joint venture ($166 in
FY18), and (ii) the reduction of an earnout liability ($1,386 in
FY18).
|
|
6.
| |
Includes adjustments relating to the following: (i) the tax impact
of the Tax Act and other discrete items (($2,559) in Q4 FY18 and
$11,671 in FY18); (ii) the tax impact as a result of the adoption of
ASU No. 2016-09, Compensation - Stock Compensation due to the
acceleration of vesting of share awards in October 2017 and March
2018 ($269 Q4 FY18 and $19,122 in FY18), and (iii) the tax impact,
using the adjusted effective tax rate, of the adjustments described
in footnotes 1, 3, and 5 ($1,335 for Q4 FY18 and $3,568 in Q4 FY17;
$9,018 in FY18 and $11,177 in FY17).
|
|
7.
| |
Consists of the adjustments described above net of the tax impact of
described adjustments.
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20180509006460/en/
Houlihan Lokey, Inc.
Investor Relations
212-331-8225
IR@HL.com
or
Public
Relations
212-331-8223
PR@HL.com
Source: Houlihan Lokey, Inc.