Lazard(US:LAZ)2025-04-30 21:31M&A Transactions - Completed M&A transactions in Q1 2025 totaled $778 billion, a 17% increase from $665 billion in Q1 2024, while the number of deals decreased by 32% to 6,719[253] - Announced M&A transactions in Q1 2025 reached $1,031 billion, an 18% increase from $874 billion in Q1 2024, with the number of deals decreasing by 24% to 7,712[253] - The financial advisory segment's revenues are closely tied to the completion of M&A transactions and restructuring activities, which can vary significantly from year to year[255] Restructuring Transactions - The value of completed restructuring transactions in Q1 2025 was $23 billion, an 85% decrease from $150 billion in Q1 2024, with the number of deals down 69% to 39[253] Financial Performance - Lazard's net revenue for Q1 2025 was $648,051, a decrease of 15.3% compared to $764,753 in Q1 2024[282] - Adjusted net revenue for Q1 2025 was $643,185, down 13.9% from $746,565 in Q1 2024[285] - Net income attributable to Lazard for Q1 2025 was $60,375, an increase of 68.9% from $35,755 in Q1 2024[282] - Adjusted operating income decreased by $46 million, or 38%, to $74 million, representing 11.5% of adjusted net revenue for the three months ended March 31, 2025[301] Asset Management - Lazard's asset management revenues are primarily driven by the level of assets under management (AUM), which is influenced by market movements and product mix[257] - Total Assets Under Management (AUM) increased to $227 billion as of March 31, 2025, up by $1 billion from $226 billion at December 31, 2024[319] - Adjusted net revenue for the Asset Management segment decreased by $11 million, or 4%, to $264,494 million compared to $275,934 million in 2024[325][329] Compensation and Expenses - Total compensation and benefits expense decreased to $430,270 in Q1 2025 from $550,824 in Q1 2024, reflecting a reduction of 21.8%[289] - Adjusted compensation and benefits expense for Financial Advisory decreased by $62 million, or 21%, compared to the 2024 period[315] Market Conditions - The MSCI World Index decreased by 2% from December 31, 2024, while the S&P 500 fell by 4% in the same period, impacting asset management revenues[257] - The company operates in a competitive environment with risks related to international trade policies and market volatility affecting client decision-making[246] Cash Flow and Liquidity - Cash provided by operating activities was negative $217 million for the three months ended March 31, 2025, compared to negative $90 million in 2024[343] - The Company had approximately $909 million in cash and cash equivalents as of March 31, 2025, including $494 million held outside the U.S.[350] - Lazard's annual cash flow from operations has historically been sufficient to meet its annual obligations, indicating strong liquidity[356] Risk Management - Operational risk is inherent in the Company's businesses, including potential errors, fraud, and cyber attacks[417] - The Company has established a framework to monitor and manage operational risk, including internal controls and business continuity programs[417] Shareholder Returns - The Company repurchased 773,955 shares at an average price of $46.73 during the three months ended March 31, 2025, with $164 million remaining under the share repurchase authorization[364] - A quarterly dividend of $0.50 per share was declared on April 24, 2025, payable on May 16, 2025[365]