Moelis & pany(MC)

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Moelis & pany(MC) - 2024 Q1 - Quarterly Report
2024-04-24 21:32
UNITED STATES SECURITIES AND EXCHANGE COMMISSION For the quarterly period ended March 31, 2024 Or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-36418 Moelis & Company (Exact name of registrant as specified in its charter) Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Delaware 46-4500216 (State or other jurisdiction ...
Moelis & pany(MC) - 2024 Q1 - Quarterly Results
2024-04-24 20:16
Exhibit 99.1 Moelis & Company Reports First Quarter 2024 Financial Results; Declares Regular Quarterly Dividend of $0.60 Per Share NEW YORK, April 24, 2024 – Moelis & Company (NYSE:MC) today reported financial results for the quarter ended March 31, 2024. The Firm's first quarter GAAP revenues were $217.5 million as compared with $187.8 million in the prior year period. On an Adjusted basis, the Firm's first quarter revenues of $217.5 million increased 17% from the prior year period. The Firm reported GAAP ...
Moelis (MC) Reports Next Week: Wall Street Expects Earnings Growth
Zacks Investment Research· 2024-04-17 15:07
The market expects Moelis (MC) to deliver a year-over-year increase in earnings on higher revenues when it reports results for the quarter ended March 2024. This widely-known consensus outlook is important in assessing the company's earnings picture, but a powerful factor that might influence its near-term stock price is how the actual results compare to these estimates.The stock might move higher if these key numbers top expectations in the upcoming earnings report, which is expected to be released on Apri ...
Moelis Announces Continued Expansion of its Energy Franchise
Businesswire· 2024-02-28 14:00
NEW YORK & HOUSTON--(BUSINESS WIRE)--Moelis (NYSE: MC), a leading global independent investment bank, today announced that it has appointed Stephen Trauber as Chairman and Global Head of Energy and Clean Technology. Based in Houston, Steve will lead the Firm’s global efforts in this space, building on the strength of its U.S. Energy business, led by David Cunningham, and its deep expertise across the Middle East and Europe. His arrival further expands the Firm’s offerings and relationships across energy ser ...
Moelis & pany(MC) - 2023 Q4 - Annual Report
2024-02-21 16:00
Part I [Business](index=3&type=section&id=Item%201.%20Business) Moelis & Company is a global independent investment bank offering strategic and financial advisory services, including M&A and restructuring, to diverse clients, operating under a 'One Firm' approach and subject to extensive financial regulation - Moelis & Company is a **global independent investment bank** providing financial advisory services on M&A, recapitalizations, and capital markets transactions[14](index=14&type=chunk) - The firm operates with **824 advisory professionals**, including **160 Managing Directors**, across more than **20 locations** worldwide[16](index=16&type=chunk) - The company's advisory focus allows it to offer advice free from conflicts associated with lending, trading, or cross-selling products, operating a **capital-light model**[32](index=32&type=chunk) - In 2023, the company hired **24 new Managing Directors** to capitalize on market dislocation and enhance sector, product, and regional capabilities[33](index=33&type=chunk) - The business is diversified, with the top 10 transactions in 2023 accounting for approximately **22% of revenues**[39](index=39&type=chunk) [Our Advisory Offering](index=4&type=section&id=Our%20Advisory%20Offering) - The firm offers holistic advisory solutions by integrating deep industry knowledge with global capabilities across sectors like Technology, Healthcare, Energy, and Real Estate[18](index=18&type=chunk)[19](index=19&type=chunk) - Core services include **M&A and strategic advisory**, capital markets advice, capital structure advisory for distressed situations, and private funds advisory for sponsors[21](index=21&type=chunk)[22](index=22&type=chunk)[26](index=26&type=chunk) - The shareholder advisory team provides solutions for contested shareholder situations, including defense against activist campaigns and proxy fights[24](index=24&type=chunk) [Our People](index=7&type=section&id=Our%20People) - The company's compensation philosophy is discretionary and not commission-based, rewarding collaboration, client impact, and long-term relationships to align with firm interests[45](index=45&type=chunk) - Moelis & Company is committed to **diversity and inclusion**, driven by executive leadership, and supports over **50 nonprofit organizations** globally[46](index=46&type=chunk)[48](index=48&type=chunk) - The firm invests heavily in junior talent through dedicated campus recruiting, training, and mentoring programs with the goal of developing them into future Managing Directors[49](index=49&type=chunk) [Our Strategic Alliances](index=8&type=section&id=Our%20Strategic%20Alliances) - The company maintains a significant investment and strategic alliance with MA Financial Group Limited (formerly Moelis Australia) for its investment banking advisory business in Australia and New Zealand[50](index=50&type=chunk)[51](index=51&type=chunk) - A strategic alliance with Alfaro, Dávila y Scherer, S.C. (ADS) in Mexico provides advisory services for global clients, focusing on cross-border transactions and giving Moelis a presence in Latin America's two largest markets (Mexico and Brazil)[52](index=52&type=chunk) [Competition](index=8&type=section&id=Competition) - The financial services industry is intensely competitive, with primary competitors including large investment banks like Goldman Sachs and JPMorgan Chase, as well as independent firms such as Evercore and Lazard[53](index=53&type=chunk)[54](index=54&type=chunk) - Large, diversified financial institutions can offer a wider range of products, such as lending and trading, potentially creating a competitive disadvantage and pricing pressure for advisory-focused firms[57](index=57&type=chunk)[100](index=100&type=chunk) [Regulation](index=9&type=section&id=Regulation) - The company's U.S. subsidiary, Moelis & Company LLC, is a registered broker-dealer subject to regulation by the **SEC and FINRA**, including the SEC's uniform net capital rule (Rule 15c3-1)[58](index=58&type=chunk)[59](index=59&type=chunk) - Internationally, the firm is regulated by authorities such as the Financial Conduct Authority in the UK, the Securities and Futures Commission in Hong Kong, and the Dubai Financial Services Authority[60](index=60&type=chunk) - The company is subject to anti-money laundering laws, such as the Bank Secrecy Act and USA PATRIOT Act, and anti-corruption laws like the FCPA and UK Bribery Act[65](index=65&type=chunk)[67](index=67&type=chunk) [Organizational Structure](index=12&type=section&id=Organizational%20Structure) - Moelis & Company is a holding company whose only assets are its partnership interests in the operating entity, Moelis & Company Group LP ("Group LP"), and its subsidiaries[73](index=73&type=chunk) - As of December 31, 2023, public stockholders held a **49% voting interest** through Class A common stock, while Moelis & Company Partner Holdings LP held a **51% voting interest** through Class B common stock[75](index=75&type=chunk) - Group LP Class A unitholders (other than Moelis & Company) have the right to exchange their units for shares of Class A common stock on a one-for-one basis or for cash, at Group LP's option[81](index=81&type=chunk) [Risk Factors](index=16&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant risks related to its business, organizational structure, and common stock, including intense competition, talent retention, market volatility, litigation, regulatory compliance, and the substantial voting power of its CEO [Risks Related to Our Business](index=16&type=section&id=Risks%20Related%20to%20Our%20Business) - Future growth depends on the ability to recruit and retain qualified professionals, as the loss of Managing Directors could jeopardize client relationships and lead to lost engagements[93](index=93&type=chunk)[95](index=95&type=chunk) - The business is materially affected by global financial market and economic conditions, which can reduce the volume and value of M&A transactions, thereby decreasing demand for advisory services[102](index=102&type=chunk) - Revenue is highly volatile as it is derived almost entirely from advisory fees on a limited number of engagements, with payment often contingent on the successful closing of transactions[108](index=108&type=chunk)[109](index=109&type=chunk) - The firm faces substantial litigation risks from its role as an advisor, including potential liabilities from fairness opinions and capital markets transactions[121](index=121&type=chunk) - Extensive and evolving financial regulations expose the company to significant penalties for compliance failures; on August 8, 2023, the company settled with the SEC for a **$10.0 million** penalty regarding recordkeeping of business communications[122](index=122&type=chunk)[124](index=124&type=chunk) - The business is subject to various cybersecurity risks, including data breaches and system disruptions, which could lead to financial losses, regulatory sanctions, and reputational damage[129](index=129&type=chunk)[131](index=131&type=chunk) [Risks Related to Our Organizational Structure](index=25&type=section&id=Risks%20Related%20to%20Our%20Organizational%20Structure) - As a holding company, Moelis & Company's only asset is its interest in Group LP, making it dependent on distributions from Group LP to pay dividends, taxes, and other expenses[152](index=152&type=chunk)[153](index=153&type=chunk) - The company is required to pay its Managing Directors **85%** of the cash tax savings it realizes from the tax basis step-up resulting from exchanges of Group LP units for Class A common stock[158](index=158&type=chunk)[159](index=159&type=chunk) - Under certain circumstances, such as a change of control, payments under the tax receivable agreement could be accelerated and may significantly exceed the actual tax benefits realized by the company[162](index=162&type=chunk) [Risks Related to Our Class A Common Stock](index=27&type=section&id=Risks%20Related%20to%20Our%20Class%20A%20Common%20Stock) - Chairman and CEO Kenneth Moelis holds significant voting power (approximately **40%** as of Dec 31, 2023) through his control of Partner Holdings, which holds all Class B common stock, allowing him to exert substantial influence over the company's management and affairs[164](index=164&type=chunk) - The company's dividend policy may change at any time, and there is no guarantee that it will continue to declare quarterly cash dividends[170](index=170&type=chunk) - Anti-takeover provisions in the company's organizational documents and Delaware law could delay or prevent a change in control that stockholders might consider favorable[171](index=171&type=chunk) [Unresolved Staff Comments](index=30&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports that it has no unresolved staff comments - Not applicable[172](index=172&type=chunk) [Cybersecurity](index=30&type=section&id=Item%201C.%20Cybersecurity) The company maintains a comprehensive cybersecurity program to manage threats related to sensitive client and proprietary information, overseen by a CISO and the Board of Directors - The company faces cybersecurity threats due to its management of sensitive client data and dependence on IT systems, with risks heightened by remote work[173](index=173&type=chunk) - A cybersecurity program is in place, utilizing industry strategies like identity management, network security, encryption, and incident response planning[174](index=174&type=chunk) - The program is overseen by a CISO with over **20 years of experience**, who reports to the CIO; the Board of Directors is responsible for oversight of cybersecurity risks and reviews related matters at least quarterly[177](index=177&type=chunk)[180](index=180&type=chunk) [Properties](index=31&type=section&id=Item%202.%20Properties) The company does not own any real property, with its principal executive offices and all other global offices located in leased spaces - The company's principal executive offices are leased at 399 Park Avenue, New York, New York[181](index=181&type=chunk) - All global offices are in leased spaces, and the company does not own any real property[181](index=181&type=chunk) [Legal Proceedings](index=31&type=section&id=Item%203.%20Legal%20Proceedings) The company is involved in ordinary course legal and regulatory proceedings, including a $10.0 million SEC settlement for recordkeeping and a class action lawsuit challenging stockholder agreement provisions - On August 8, 2023, the company settled with the SEC for a **$10.0 million** civil penalty to resolve an administrative proceeding related to recordkeeping of business communications on messaging applications[183](index=183&type=chunk) - In March 2023, a class action lawsuit was filed by a stockholder in the Delaware Court of Chancery, seeking a declaratory judgment that certain provisions of the Stockholders Agreement with Partner Holdings are invalid under Delaware law[184](index=184&type=chunk) [Mine Safety Disclosures](index=31&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) The company reports that this item is not applicable - Not applicable[185](index=185&type=chunk) Part II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=32&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's Class A common stock trades on the NYSE, maintains a regular quarterly dividend policy, and repurchased shares in Q4 2023 with $62.5 million remaining under its authorization - The company's Class A common stock is traded on the New York Stock Exchange under the symbol "MC"[188](index=188&type=chunk) - In February 2024, the Board declared a quarterly dividend of **$0.60 per share**, payable on March 28, 2024[190](index=190&type=chunk) Share Repurchases in Q4 2023 | Period | Total Number of Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | October 1 - October 31 | — | $ — | | November 1 - November 30 | 5,159 | $43.82 | | December 1 - December 31 | 24,394 | $51.52 | | **Total** | **29,553** | **$50.18** | - As of the end of Q4 2023, approximately **$62.5 million** remained available for future purchases under the company's share repurchase program, which was authorized in July 2021 for up to **$100 million**[197](index=197&type=chunk)[198](index=198&type=chunk) [Selected Financial Data](index=33&type=section&id=Item%206.%20Selected%20Financial%20Data) The company reports that this item is not applicable - Not Applicable[200](index=200&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=34&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) In fiscal year 2023, Moelis & Company reported revenues of **$854.7 million**, a **13% decrease** from 2022, resulting in an operating loss of **$40.4 million** due to increased compensation costs from new hires, while maintaining a strong liquidity position [Business Environment and Outlook](index=34&type=section&id=Business%20Environment%20and%20Outlook) - For the year ended December 31, 2023, GAAP revenues were **$854.7 million**, a **13% decrease** from 2022, which was less severe than the **32% decrease** in global completed M&A transactions over $100 million during the same period[206](index=206&type=chunk) - The company anticipates increased financial sponsor-related M&A activity due to record levels of accumulated capital and a backlog of unsold portfolio companies[207](index=207&type=chunk) - Restructuring mandates increased in 2023 due to higher borrowing costs, and the company expects continued demand for capital structure advice as companies face significant debt maturity walls[207](index=207&type=chunk) [Results of Operations](index=35&type=section&id=Results%20of%20Operations) Consolidated Results of Operations ($ in thousands) | | 2023 | 2022 | % Change | | :--- | :--- | :--- | :--- | | **Revenues** | **$854,748** | **$985,297** | **-13%** | | Compensation and benefits | $714,749 | $618,195 | 16% | | Non-compensation expenses | $180,351 | $151,002 | 19% | | **Total operating expenses** | **$895,100** | **$769,197** | **16%** | | **Operating income (loss)** | **($40,352)** | **$216,100** | **N/M** | | Income (loss) before income taxes | ($29,147) | $216,320 | N/M | | **Net income (loss)** | **($27,516)** | **$168,682** | **N/M** | - The **13% decrease** in 2023 revenues was driven by a lower number of completed transactions compared to the prior year[217](index=217&type=chunk) - Total operating expenses increased by **16%** in 2023, primarily due to higher compensation and benefits expense from significant new hires and increased transaction-related non-compensation expenses[220](index=220&type=chunk) - Compensation expenses as a percentage of revenue increased to **84%** in 2023 from **63%** in 2022, driven by a decline in revenues, new hire guarantees, and greater headcount[225](index=225&type=chunk) [Liquidity and Capital Resources](index=38&type=section&id=Liquidity%20and%20Capital%20Resources) - As of December 31, 2023, the company had **$49.1 million** in cash and **$137.4 million** in cash equivalents, primarily invested in U.S. and U.K. sovereign debt securities and money market funds[235](index=235&type=chunk) - The company maintains a **$65.0 million** revolving credit facility for working capital, with **$64.4 million** available as of December 31, 2023, and no borrowings outstanding[238](index=238&type=chunk)[239](index=239&type=chunk)[240](index=240&type=chunk) - During 2023, the company paid aggregate dividends of **$2.40 per share** and repurchased **1,107,683 shares**[242](index=242&type=chunk)[244](index=244&type=chunk) - As of December 31, 2023, the company has a total payable of **$304.6 million** due under its tax receivable agreement, with an estimated **$21.4 million** due in less than one year[254](index=254&type=chunk) [Critical Accounting Policies and Estimates](index=41&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) - The vast majority of advisory services revenue is recognized over time; however, variable transaction fees are constrained and not recognized until services are substantially complete and a significant revenue reversal is improbable[265](index=265&type=chunk)[266](index=266&type=chunk) - The allowance for credit losses is estimated by stratifying receivables into short-term and private funds advisory categories and applying a percentage reserve based on aging, historical charge-offs, and current economic conditions[270](index=270&type=chunk) - The company accounts for income taxes under ASC 740, requiring recognition of deferred tax assets and liabilities for temporary differences, with a valuation allowance applied if realization is not more-likely-than-not[273](index=273&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=43&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's market risk disclosures are included in Item 7, primarily addressing credit risk related to accounts receivable and exchange rate risk from non-U.S. dollar denominated assets and liabilities - Disclosures about market risk are provided in "Item 7—Management's Discussion and Analysis of Financial Condition and Results of Operations—Market Risk and Credit Risk"[276](index=276&type=chunk) [Financial Statements and Supplementary Data](index=44&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents the company's consolidated financial statements for fiscal year 2023, including Management's Report on Internal Control over Financial Reporting and the unqualified audit opinion from Deloitte & Touche LLP - Management concluded that the company maintained effective internal control over financial reporting as of December 31, 2023, based on the COSO framework[279](index=279&type=chunk) - The independent auditor, Deloitte & Touche LLP, issued an unqualified opinion on both the consolidated financial statements and the effectiveness of the company's internal control over financial reporting[283](index=283&type=chunk)[290](index=290&type=chunk) - The auditor identified the recognition of transaction fees at year-end as a critical audit matter due to the significant management judgment required to assess if recognition criteria were met prior to a transaction's closing[296](index=296&type=chunk)[297](index=297&type=chunk) [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=75&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports that there were no changes in or disagreements with its accountants on accounting and financial disclosure - None[436](index=436&type=chunk) [Controls and Procedures](index=75&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and internal control over financial reporting were effective as of December 31, 2023, with no material changes during the period - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of the end of the reporting period[437](index=437&type=chunk) - Management concluded that internal control over financial reporting was effective as of December 31, 2023[438](index=438&type=chunk) - No material changes were made to the company's internal control over financial reporting during the period[440](index=440&type=chunk) [Other Information](index=75&type=section&id=Item%209B.%20Other%20Information) On February 22, 2024, the company renewed its Master Services Agreement with Moelis Asset Management LP for a one-year term, pertaining to shared administrative services - The company renewed its Master Services Agreement with Moelis Asset Management LP for one year on February 22, 2024[441](index=441&type=chunk) [Disclosure Regarding Foreign Jurisdictions That Prevent Inspections](index=75&type=section&id=Item%209C.%20Disclosure%20Regarding%20Foreign%20Jurisdictions%20That%20Prevent%20Inspections) The company reports that this item is not applicable - Not Applicable[442](index=442&type=chunk) Part III [Directors, Executive Officers, Corporate Governance, Compensation, Security Ownership, and Accountant Fees](index=76&type=section&id=Items%2010-14) Information for Items 10 through 14, covering directors, executive officers, corporate governance, compensation, security ownership, and accountant fees, is incorporated by reference from the company's 2024 annual meeting proxy statement - Information for Items 10, 11, 12, 13, and 14 is incorporated by reference from the registrant's definitive proxy statement for its 2024 annual meeting of stockholders[445](index=445&type=chunk)[446](index=446&type=chunk)[451](index=451&type=chunk) Equity Compensation Plan Information (as of Dec 31, 2023) | Plan Category | Number of Shares to be Issued Upon Vesting | Number of Shares Remaining Available for Future Issuance | | :--- | :--- | :--- | | Equity compensation plans approved by shareholders | 11,822,548 | 6,205,941 | | Equity compensation plans not approved by shareholders | — | — | | **Total** | **11,822,548** | **6,205,941** | Part IV [Exhibits and Financial Statement Schedules](index=77&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists the financial statements, financial data schedules, and various exhibits filed as part of the Form 10-K, including organizational documents, material contracts, and certifications - This section contains the list of consolidated financial statements filed in Item 8[454](index=454&type=chunk) - An index of all exhibits filed with the report is provided, including organizational documents, material contracts, and certifications[457](index=457&type=chunk)[458](index=458&type=chunk)
Moelis & Company (MC) Incurs Loss in Q4, Revenues Rise Y/Y
Zacks Investment Research· 2024-02-08 15:00
Moelis & Company (MC) incurred a fourth-quarter 2023 adjusted loss per share of 6 cents, which was narrower than the Zacks Consensus Estimate for a loss of 11 cents. The bottom line compared unfavorably with earnings of 33 cents in the prior-year quarter.Results were adversely impacted by a surge in expenses. However, an improvement in revenues and a solid liquidity position were the positives.Net loss (GAAP basis) was $6.5 million or 8 cents per share against a net income of $22.7 million or 28 cents per s ...
Moelis & Company (MC) Q4 2023 Earnings Conference Call Transcript
Seeking Alpha· 2024-02-08 03:01
Moelis & Company (NYSE:MC) Q4 2023 Earnings Conference Call February 7, 2024 5:00 PM ET Company Participants Matt Tsukroff - IR Joe Simon - CFO Ken Moelis - Chairman & CEO Conference Call Participants Devin Ryan - JMP Securities Ken Worthington - JP Morgan Brennan Hawking - UBS James Yaro - Goldman Sachs Stephen Chubak - Wolf Research Charles Smith - Morgan Stanley Mike Brown - KBW Operator Good afternoon and welcome to the Moelis & Company Earnings Conference Call for the Fourth Quarter in 2023. To begin, ...
Moelis (MC) Reports Q4 Loss, Tops Revenue Estimates
Zacks Investment Research· 2024-02-08 00:51
Moelis (MC) came out with a quarterly loss of $0.06 per share versus the Zacks Consensus Estimate of a loss of $0.11. This compares to earnings of $0.33 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 45.45%. A quarter ago, it was expected that this investment bank would post earnings of $0.05 per share when it actually produced a loss of $0.15, delivering a surprise of -400%.Over the last four quarters, the company has surpas ...
Earnings Preview: Moelis (MC) Q4 Earnings Expected to Decline
Zacks Investment Research· 2024-01-31 16:06
Wall Street expects a year-over-year decline in earnings on lower revenues when Moelis (MC) reports results for the quarter ended December 2023. While this widely-known consensus outlook is important in gauging the company's earnings picture, a powerful factor that could impact its near-term stock price is how the actual results compare to these estimates.The earnings report, which is expected to be released on February 7, 2024, might help the stock move higher if these key numbers are better than expectati ...
Moelis & Company to Announce Fourth Quarter and Full Year 2023 Financial Results and Host a Conference Call on February 7, 2024
Businesswire· 2024-01-17 21:15
NEW YORK--(BUSINESS WIRE)--Moelis & Company (NYSE: MC), a leading global independent investment bank, will release its fourth quarter and full year 2023 financial results after the market closes on Wednesday, February 7, 2024. Ken Moelis, Chairman and Chief Executive Officer, and Joe Simon, Chief Financial Officer, will also host a related conference call at 5:00pm ET on the same day (February 7, 2024) to review the financial results. Following the review, there will be a question and answer session. In ...