Lazard(US:LAZ)2021-05-03 16:00Financial Performance - Consolidated net revenue for the first quarter of 2021 was derived from Financial Advisory (48%), Asset Management (53%), and Corporate (-1%) segments[230]. - Lazard's net revenue for Q1 2021 was $660,107,000, an increase of 22.7% compared to $538,014,000 in Q1 2020[268]. - Operating income for Q1 2021 was $134,290,000, representing 20.3% of net revenue, up from 15.6% in Q1 2020[268]. - Net income attributable to Lazard Ltd for Q1 2021 was $87,300,000, up from $64,022,000 in Q1 2020, a growth of 36.3%[268]. - The company reported a net income of $91 million for Q1 2021, up from $58 million in Q1 2020[312]. - Total operating revenue increased by $85 million, or 15%, to $647.9 million for the three months ended March 31, 2021, compared to $562.8 million in the prior year[277]. M&A Activity - The value of completed M&A transactions increased by 42% to $1,001 billion in Q1 2021 compared to $707 billion in Q1 2020[240]. - Announced M&A transactions saw a significant increase of 116%, reaching $1,441 billion in Q1 2021, up from $667 billion in Q1 2020[240]. - The company completed 20 M&A transactions valued over $500 million during the quarter, compared to 22 in the same period last year[286]. Asset Management - Asset Management total AUM reached $265 billion, an increase of $6 billion, or 2%, compared to $259 billion at December 31, 2020, primarily due to market appreciation[294]. - Net revenue for the Asset Management segment increased by $65 million, or 23%, to $347.5 million in Q1 2021 compared to $282.5 million in Q1 2020[304]. - Operating income for the Asset Management segment rose to $115.4 million, a 47% increase from $78 million in Q1 2020, with an operating income margin of 33.2%[305]. - The geographical distribution of Asset Management net revenue showed a decrease in the Americas from 51% in 2020 to 46% in 2021, while EMEA increased from 36% to 44%[302]. Expenses and Costs - Compensation and benefits expenses increased to $401,546,000 in Q1 2021 from $319,755,000 in Q1 2020, reflecting a rise of 25.5%[268]. - Total operating expenses for Q1 2021 were $525,817,000, compared to $453,917,000 in Q1 2020, marking an increase of 15.8%[268]. - Adjusted compensation and benefits expense was $385 million, an increase of $48 million, or 14%, compared to $338 million in the same period of 2020, with a ratio of 59.5% to operating revenue[279]. - Adjusted non-compensation expense decreased by $10 million, or 9%, to $102.5 million, with a ratio of 15.8% to operating revenue, down from 20.0% in the prior year[280]. Economic Outlook - The outlook for Financial Advisory remains optimistic due to recovering M&A transaction volumes, particularly in the U.S. and Europe, despite ongoing uncertainties[234]. - The overall economic environment remains uncertain due to the ongoing COVID-19 pandemic, impacting both M&A and capital-raising activities[231]. - Asset Management is expected to see increasing AUM from developing economies as retirement systems evolve and individual wealth grows[236]. Technology and Investment Strategies - The company continues to focus on developing new investment strategies, including ESG considerations, quantitative equity strategies, and new convertible bond strategies[236]. - The company is committed to investing in technology to support business development and enhance operational efficiency[237]. Shareholder Returns and Equity - The Board of Directors declared a quarterly dividend of $0.47 per share, payable on May 21, 2021[332]. - Total stockholders' equity decreased to $867 million as of March 31, 2021, down from $999 million at December 31, 2020[329]. - During the three months ended March 31, 2021, Lazard repurchased 2,899,541 shares at an average price of $42.30 per share[330]. Risk Management - The company has implemented a framework to manage operational risk, including business continuity and disaster recovery programs[391]. - The company maintains an allowance for doubtful accounts to cover probable losses from receivables, with the allowance being $35 million as of March 31, 2021[382].