Houlihan Lokey(US:HLI)2025-05-15 20:45Company Overview - As of March 31, 2025, the company had a team of 1,893 financial professionals across 35 offices globally, serving over 2,000 clients annually[19]. - The company employs a total of 2,702 people as of March 31, 2025, reflecting a slight increase from 2,601 in 2024[38]. - Approximately 1,100 present and former employee shareholders collectively own about 24% of the company's equity, promoting a culture of broad employee ownership[35]. Business Segments - The Corporate Finance segment had 240 Managing Directors focusing on mid-cap transactions, which are considered an attractive and underserved market segment[20]. - The M&A business is recognized as one of the most prolific sell-side advisors, consistently selling more companies valued under $1 billion than any competitor[23]. - The Financial Restructuring group, with 57 Managing Directors, is one of the largest in the investment banking industry, focusing on complex restructuring and liability management transactions globally[28]. - The Financial and Valuation Advisory group, consisting of 42 Managing Directors, is known for its expertise in valuation and financial opinions, serving a wide range of clients[33]. Market Presence and Competition - The company has established a significant presence in major industry segments, including technology, healthcare, and financial services, and continues to expand its capabilities through internal promotions and acquisitions[21]. - The company competes with various investment banking firms, including bulge-bracket firms and boutique firms, based on industry knowledge and client relationships[39]. Regulatory Compliance - Regulatory compliance is a significant aspect of the company's operations, with oversight from the SEC and FINRA, ensuring adherence to financial regulations[41]. - The company is subject to various compliance regulations, including the U.S. Foreign Corrupt Practices Act and the UK Bribery Act, to mitigate reputational risks[57]. International Operations and Currency Risk - The company operates through various subsidiaries across Europe, Asia Pacific, the Middle East, and South America, providing regulated and unregulated financial advisory services[46][51][52][56]. - The company maintains cash and cash equivalents primarily in U.S. Dollars, Pound Sterling, Euros, and Yen, facing foreign currency risk due to potential currency movements[206][208]. - For the years ended March 31, 2025, 2024, and 2023, the net impact of foreign currency fluctuations on other comprehensive income was $3.3 million, $(3.8) million, and $(19.5) million, respectively[209]. - As of March 31, 2025, the company had foreign currency forward contracts with an aggregate notional value of $75.0 million and SEK 79.0 million, reflecting a gain in other operating expenses[211]. - The company has been impacted by changes in exchange rates, with potential future impacts increasing as international expansion continues[212]. - The company’s European operations are supported by HLE GmbH, established to mitigate Brexit impacts, and is approved by the German regulatory authority[48][49]. Financial Management - The company regularly reviews accounts receivable and maintains an allowance for credit losses to cover potential losses[207]. - As of March 31, 2025, the HL Voting Trust controls approximately 74.9% of the total voting power of the company, classifying it as a "controlled company" under NYSE rules[60][61].