PJT Partners (PJT) - 2025 Q2 - Quarterly Report

PART I. FINANCIAL INFORMATION Item 1. Financial Statements PJT Partners Inc.'s unaudited condensed consolidated financial statements for Q2 and H1 2025, detailing financial condition, operations, and cash flows Condensed Consolidated Statements of Financial Condition Total Assets decreased to $1.51 billion from $1.64 billion as of June 30, 2025, due to reduced Cash and Cash Equivalents Condensed Consolidated Statements of Financial Condition (Unaudited) | (In Thousands) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Assets | $1,511,398 | $1,635,334 | | Cash and Cash Equivalents | $214,615 | $483,877 | | Accounts Receivable, Net | $358,954 | $320,783 | | Total Liabilities | $662,796 | $733,691 | | Accrued Compensation and Benefits | $156,739 | $299,255 | | Operating Lease Liabilities | $414,659 | $354,520 | | Total Equity | $848,602 | $901,643 | Condensed Consolidated Statements of Operations Q2 2025 Total Revenues increased 13% to $406.9 million, with Net Income up 16% and Diluted EPS at $1.21 Q2 2025 vs Q2 2024 Performance (Three Months Ended June 30) | (In Thousands, Except EPS) | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenues | $406,884 | $360,181 | +13.0% | | Advisory Fees | $354,521 | $307,082 | +15.4% | | Total Expenses | $330,405 | $295,782 | +11.7% | | Net Income | $61,438 | $53,031 | +15.9% | | Diluted EPS | $1.21 | $1.06 | +14.2% | YTD 2025 vs YTD 2024 Performance (Six Months Ended June 30) | (In Thousands, Except EPS) | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenues | $731,415 | $689,574 | +6.1% | | Advisory Fees | $636,708 | $595,763 | +6.9% | | Total Expenses | $602,358 | $571,272 | +5.4% | | Net Income | $135,601 | $106,403 | +27.4% | | Diluted EPS | $3.21 | $2.29 | +40.2% | Condensed Consolidated Statements of Cash Flows Net cash from operations decreased to $114.5 million for H1 2025, with significant cash used for share repurchases Cash Flow Summary (Six Months Ended June 30) | (In Thousands) | 2025 | 2024 | | :--- | :--- | :--- | | Net Cash Provided by Operating Activities | $114,488 | $154,775 | | Net Cash Used in Investing Activities | ($52,822) | ($106,194) | | Net Cash Used in Financing Activities | ($339,300) | ($238,768) | | Net Decrease in Cash and Cash Equivalents | ($269,262) | ($191,340) | | Cash and Cash Equivalents, End of Period | $214,615 | $164,203 | Notes to Condensed Consolidated Financial Statements Notes detail revenue recognition, equity compensation, and commitments, including a credit facility and quarterly dividend - As of June 30, 2025, the company had $36.2 million in transaction price allocated to performance obligations yet to be satisfied, which is expected to be recognized as revenue within the next twelve months[42] - The company's remaining share repurchase authorization was $87.2 million as of June 30, 2025, under a $500 million program announced in February 2024[59] - As of June 30, 2025, there was $372.1 million of estimated unrecognized compensation expense related to unvested RSU awards, expected to be recognized over a weighted-average period of 1.7 years[63] - The company entered into a $100 million syndicated revolving credit facility on July 29, 2024, with no borrowings outstanding as of June 30, 2025[77][79] - A quarterly dividend of $0.25 per share of Class A common stock was declared, payable on September 17, 2025[94] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses financial results, business environment, and liquidity, emphasizing revenue growth and capital returns Business Environment The business environment shows mixed trends with increased M&A volumes but fewer transactions, and elevated restructuring - Worldwide M&A announced volumes increased 33% in Q2 2025 compared to the prior year, but the number of transactions declined[100] - Global restructuring and special situations trends remained elevated during Q2 2025, driven by liability management, balance sheet restructuring, and bankruptcy activity[101] - Fund placement activity remains challenging due to the macroeconomic environment, with limited partners being more discerning and focusing on existing relationships[102] Condensed Consolidated Results of Operations Q2 2025 total revenues rose 13% to $406.9 million, driven by Advisory Fees, increasing pre-tax income Revenue Performance (Three Months Ended June 30) | (In Thousands) | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Advisory Fees | $354,521 | $307,082 | +15% | | Placement Fees | $43,219 | $46,873 | -8% | | Total Revenues | $406,884 | $360,181 | +13% | Expense Performance (Three Months Ended June 30) | (In Thousands) | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Compensation and Benefits | $276,834 | $250,326 | +11% | | Non-Compensation Expenses | $53,571 | $45,456 | +18% | | Total Expenses | $330,405 | $295,782 | +12% | - The increase in Advisory Fees for both the three and six-month periods was principally due to an increase in strategic advisory revenues[120][122] Liquidity and Capital Resources As of June 30, 2025, the company held $318.4 million in cash, with significant cash used for share repurchases - As of June 30, 2025, the company had cash, cash equivalents, and short-term investments of $318.4 million[131] - The company has a $100 million syndicated revolving credit facility, with no borrowings outstanding as of June 30, 2025[130] - During the six months ended June 30, 2025, the company repurchased 1.3 million shares for $190.5 million[141] - For the six months ended June 30, 2025, $81.3 million in cash was used to exchange 0.5 million Partnership Units[139] Item 3. Quantitative and Qualitative Disclosures About Market Risk The company reports no material changes to its market risk exposures since December 31, 2024 - There have been no material changes in the company's market risk exposures since December 31, 2024[151] Item 4. Controls and Procedures Management concluded disclosure controls were effective, with no material changes to internal control over financial reporting - The Chief Executive Officer and Chief Financial Officer concluded that the Company's disclosure controls and procedures were effective as of the end of the period covered by the report[152] - No material changes occurred in the company's internal control over financial reporting during the most recent quarter[153] PART II. OTHER INFORMATION Item 1. Legal Proceedings The company is subject to ordinary course legal and regulatory proceedings, none expected to have a material financial effect - The company is not currently party to any material pending legal proceedings that would have a material effect on its financial condition[155] Item 1A. Risk Factors No material changes were reported to the risk factors previously disclosed in the Annual Report on Form 10-K for 2024 - No material changes were reported to the risk factors disclosed in the Annual Report on Form 10-K for the year ended December 31, 2024[157] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds The company details Q2 2025 share repurchases and remaining authorization under its equity repurchase program Issuer Purchases of Equity Securities in Q2 2025 | Period | Total Shares Repurchased | Average Price Paid Per Share | | :--- | :--- | :--- | | April 1 to April 30 | 353,224 | $130.74 | | May 1 to May 31 | 77,594 | $145.95 | | June 1 to June 30 | 38,300 | $152.52 | | Total | 469,118 | $135.04 | - As of June 30, 2025, the company had $87.2 million remaining under its $500 million share repurchase authorization[159] Item 5. Other Information No directors or officers adopted, terminated, or modified Rule 10b5-1 trading arrangements during Q2 2025 - No directors or officers adopted, terminated, or modified a Rule 10b5-1 trading arrangement during the three months ended June 30, 2025[163]