HLI - Earnings call transcript Q2 2022

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Operator

Greetings, ladies and gentlemen. Thank you for standing by. Welcome to Houlihan Lokey’s Second Quarter Fiscal Year 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. conference being this XX, today, that XXXX. note call recorded is October Please turn to call Lokey's will the I now over General Christopher Counsel. Houlihan Crain, Thank sir. you,

You may begin.

Christopher Crain

now, to Thank should which Relations at can the year everyone. www.hl.com and on you, release, By found Lokey operator, XXXX earnings have second our section. Houlihan access be quarter in fiscal hello, Investor everyone website the

other caution We phrases statements, formal cause the relying that and risks forward-looking or and our of should begin for therefore, from financial results is for regulatory interpreting as remarks, XX-Q are of discussion you you our including guarantees results anticipate, numerous could forward-looking statements September could that the filings, statements. materially today our similar we expect, to actual such everyone and we by of These SEC. Before review them. future all we to Form encourage remind identified a include performance. uncertainties recent to when should SEC quarter the XXXX, filings with impact investors discussion our will These when to the words use to risks filed not We which detailed refer usually ended XX, need subject it of are differ the future exercise and that more operating expect, will, condition. on are what

GAAP. comparable as to hl.com the of remarks, turn some financial for reconciliation be company. measures is be questions. These financial the Scott. Officer Executive we not we a in Lokey's the call, in measures call and and Alley, non-GAAP Hosting will measures earnings During today's or to open available accordance these today, presentation most will and prepared that, Scott company's in have in our believe measures, to will provide discuss Houlihan opening performance. substitute the isolation directly Officer; with They results over investor considered Financial useful I'll of website. call we the GAAP A Chief we financial Beiser, evaluating call on the Lindsey the which our can release our Chief then should With

Scott Beiser

to Thank Christopher. fiscal quarter everyone, Welcome, earnings our year second you, XXXX call.

last pleased we've another are We XXXX, performed a pandemic. year, result our record All was Corporate report business and advisory achieved the produced very ago. This solid market million delivered from results, financial and restructuring finance robust quarter. year revenues challenging results We second experienced to of $XXX during and a up relatively environment. summer to a as second valuation of the quarter driven strong very since quarterly of ongoing environment the by quarter restructuring a that increase business three significant segments weak the in XX% very comparison financial well. and

expense marketing XX%, are above margin we we although travel starting some with maintaining pre-tax to On see which in the of activity, business pre-pandemic margins. costs side, consistent are adjusted approximately well increased is an increases and

we quarter XXXX, earnings up the reported from $X.XX XXX% last of per For quarter same in the second fiscal adjusted year. share,

regarding of the finance and sponsor our over finance the within previous Activity sectors fees engagements, record grow corporate is M&A billion. Or over market with components well pipeline All be non-U.S. estimated last the stabilize levels visibility And with active fastest-growing $X.X performing we levels. and continues at remain finally, our a quite to revenues XX-month quarters. industry of markets corporate Our few seen have capital business. remain as business European over corporate both operate showing business growth pace continues are number one at business trailing record and strong and to years. clients, metrics all

corporate cycle our and global business nearly an profile industry, in recognize upward Although, of finance further activity improve in XX-years look market that M&A stock no banker. product momentum and been up, clients, we diversification signs business for we through our the has of sees ways to have we now. economy, letting the said, for constantly That geography

Our $XX in nearly rate every the quarter FVA XX-month quarterly delivered has our contributing revenue fifth revenues, major business growth. million, and to reached consecutive area revenue record a with product run of trailing FVA sub growth. of million a $XXX

from it impressive the nature XX% is statistic of FVA produced in business Although, and five revenue years, of segment. least the business hires have number this MDs, execution, business new volatile work, and environment, grow. a an for has benefited has continues annual projects market The exceptional additional SPAC revenues activity. compound of from a our record activity given excess over active senior healthy FVA segment, we the growth business several last to new Currently,

continues are off business restructuring and last environment. of levels the to perform this business new activity financial year. from Our significantly in bullish revenues Accrued as peak expected market

However, business practice. cycle. highlights our on as restructuring to Evergrande transactions during single strength but hired discuss quarters, our that activity announced to this of latest in September, normally share were of a We in hired levels, global restructurings to by this the the similar don't through was restructuring that one and we quarter, we we advise on in pre-pandemic and In said market world. call, assignment continue that largest it is were in the to we we've previous leading China hold believe our reputation challenging earnings restructuring

been have the bring that economies law work their in and maturity of Asian to many and as capital markets. business lot for the resources of a Western of in to China doing and world, We have years, invested part time

one our we coming growth. into the positioned engagement that restructuring convinces exciting prospects decades. us business of the the most Evergrande the believe well for that to is expansion continue The these of growth for We over are product economies restructuring this

the step front, And tender acquisition offer of October GCA of first for XX% that the shares. as own excited quarter today, we we X. our of after the On GCA successfully we right closed on are closed

of expect the financial the acquisition XX% remaining complete the We associated highlight to with of will metrics the the month some November. of during transaction. Lindsey

have the front, On globe had mutually to the introduce several welcome integration across our events firms. we

pitching opportunities identifying are basis. and together, mandates collaborative for business a business new We executing on already

to ease and far. I with pleased we we're of thus be refer firm, very Lindsey GCA will integration discussion, a for efforts Although, as operating and single the

projecting and As XXXX. strong to previously record reported calendar are very continue by experience GCA, they results a

synergies. profile acquisitions timeline. global transaction takes suggest Houlihan Our Lokey, won't enhances pleased historical I'm experience and the a nothing suggests years basis, Bringing get highlights. and experience two countries, begin revenue combined prior On through to typically in one to measurable some to it to To-date, this forma see same the integration of to operate summarize significantly our together of diversification. our we two increasing XX the companies pro with

we adjusted approximately million. goals, a cultural annually. We income XXX values billion, importantly, we Directors. firm. X,XXX have well clients forma Most nearly and the approximately of one trailing of Managing and shared maintain have of basis, employees, serve facing client our and We pre-tax hallmarks XX-month of set a over over X,XXX $X.X $XXX believe On pro consistency is we with of revenues

quarter in from our second call advisory. Directors, results our corporate In during financial forward one to addition turn I'll With colleagues restructuring the one acquired and and recent to our in financial strong the with Overall, hired in pleased we for very we are finance, transaction GCA or two Managing to Lindsey. look performance with new and continuing that, over GCA. financial we valuation the

Lindsey Alley

in when by quarter, quarter, comments compared year, followed XX fee finance the and year. quarter, was year. transaction a decrease million in valuation last XXX million in advisory, relatively year. corporate a period quarter closed last on our revenues this Today compared average period will deals compared quick year. HL’s increase The Thank $XX last review about the the the same last the were and restructuring We same do you, what and XXX% to compared transactions second average revenues the of to last quarter same And I the In during for this quarter quarter in the $XX quarters. quarter closed up increased. Scott. a $XXX Revenues had to for the events were the expect in same were closed our period for net to coming fee the GCA XXX XX transactions same on XX% quarter, flat. year. from to We period closed financial XX% last transaction deals million from XX We XXX same

for million second the expenses year. Turning $XXX same for period versus OUR quarter, adjusted expenses, $XXX were to last million compensation the

payments adjustment acquisitions. retention only to was related deferred Our certain for

Our was for adjusted XX.X% expense compensation quarter. the ratio

in last non-compensation and quarter, year. million same to out year, XX%. we expense adjusted in the this acquisition GCA an quarter, million for the acquisition. quarter Klein This $X.X attributable versus period expenses in $XX And July, the for Baylor of an acquisition related transaction resulted both expenses in our which adjusted non-compensation quarter the $XX for costs, related amortization, adjusted $X.X acquisition same X.X% in closed the and million of XX.X% increase of last the Our were ratio for million non-compensation versus

to quarter bulk in the GCA our results. the be We expect for included of transaction third acquisition costs the

As as our we expense of did non-competition out quarter, costs quarter those we this adjust next well. will

that of of target But expense to the several historically ratio expense over too post-pandemic below is quarters. ratio. our Unfortunately, economies been pre-pandemic as to will our the range the low that tell be. it result in a new have fall XX% non-compensation scale our XX%, we expect of pandemic, early we've operating at our well non-compensation business a last is going target Given to occurred what

other on versus and approximately was of investment earned expense same expense the $XXX,XXX lower last interest income a quarter for investment our of result securities. Our balances, This our period income the year. an $XXX,XXX adjusted of and as as on losses unrealized primarily cash well in to decreased approximately

effective the quarter during the long-term our same year, XX.X%, was Our of and XX%. rate with XX.X% XX% last quarter line target between adjusted to compared in tax for

as and uses balance had to investment Turning $XXX the quarter we million and of approximately the of equivalents cash and end, of cash, securities. sheet, unrestricted

remaining $XXX we reminder, acquire XX%. additional to the acquisition pay first own expect million in the currently and the approximately company. we and transaction the to million the second in the of we an October GCA, complete $XX a XX% the paid step step to of of settle acquisition As of

X. step occur November The on expected second is to

In addition, bonuses we XXXX. our during deferred will for be fiscal November, cash paying

of shares an average Finally, of per approximately past quarter, in repurchased this part at $XX.XX share we XXX,XXX as program. our repurchase share price

February, put in want the quarters. transactions, of we we Similar a other aid thinking the the your for to place GCA, of the around will benefit Regarding over to acquisition to retention specifics share in next some several around pool no to than or aggregates the four pool will $XXX and with put We over date, retention million. that a the vest period vesting place employees in first that May GCA more year XXXX. anticipate be in

to expense retention expect will be the retention stock. similarly will we retention pools, treating of the Essentially, as the pre-IPO of we way our be pool GCA out cost. the GAAP we are out treated paid in earnings view grants. component acquisition other We retention as our a adjusting Similar we to corresponding primarily pool HL

will pool As this the retention put place, count of by go up amount a full once in is granted. reminder, our stock share

In pool. companies. recurring a expect adjusted excess a significant also Having balance over we on with combined of of only that, will combining in non-recurring run the quarters. out least cash will integration costs will the expected four costs, it That costs addition, our GCA, shareholders but not to with we associated GAAP that acquired sheet. order excess integration to Any amount is the earnings of any rate portion be cover occur our next integration provide cash said modest and at was of businesses retention there the be when

assets with with our Finally, non-cash expect of be we associated intangible there that we amortization as to acquired. all transactions, the

GCA, be we amortization be past. to adjusted out significant similar and GAAP will this have For of what earnings, done our will the in

performances costs, GCAs throughout target will calendar this XXXX. a their additional affect XXX% with targets, their currently on compensation GCA December we maintain practice in One will fourth paid compensation through remainder expect our comment fiscal quarter historical HL’s how pay long-term bonuses we GCA bonuses Regarding company, cash. ratio GCA in about that year and is Historically, our transaction the consistent we the and our fiscal beyond. based of year and our long-term will

bonus part in fourth structure. calendar this as bonuses to a cycle. bonus and bonus stock intend result year, we lieu in HL stock our with quarter pay of GCA their of to consistent portion of will the For deferred cash HL’s fiscal GCA issuing This employees, paid

grant operate to schedule plan year-end, HL employees the we going same what of all will and structure After do. this our details on on further next provide will We that bonus GCA call. calendar forward, earnings employees

Regarding the two in not expect few with the as incremental synergies to businesses. do relating the we non-compensation costs integrate non-compensation to GCA costs associated acquisition, we next see quarters the

the time, In to take the to the standalone that costs first the look year fully for expect operated fact, costs able will GCA’s those that consistent of organic non-compensation operate it over is combined a calendar where over will next We has non-compensation at basis. XXXX, some with and released several best ratio, quarters. a a assume in to HL six at company publicly there expense growth months past on be be

effective you the now tax entire separate reminder, integration. make One the consolidating up can X% not be GCA’s comment, integration, We that progress blend respect backing we will on as investment, the as their be certain XXX% own our a quarter. minority the company for and a taxes, for of final taxes of the approximately consolidated milestones assume through to our as update we weighted will be quarters a you for interest will of of But two cost With will QX. we rates. including over will the we results coming profits

For XXX% for we that, can with own quarter, entire of And fourth expect GCA. operator, open to line questions. the our we

Operator

comes Ryan of proceed with question. Thank you. from Securities. with the Our [Operator JMP first your Instructions] line Please question Devin

Devin Ryan

here everyone. just stands corporate and Obviously, Very finance out there. Great. good strength quarter the afternoon, terrific your

just to give much bit give of a relative pipeline. to deals heading like you how acceleration? the little beginning are on the today system, all, other you And the can that's I kind through specifics was changing, know you around the how a dig quarter? of if pipeline love us year? quarter around the in of I'd velocity the at progressing too Any replacing you to But pipeline are just then the what great So even don't moving into after last is obviously, or maybe context seeing

Scott Beiser

working is Hey, kind that all Devin, business of seeing in size still new deals terms almost we're pipeline on, coming of of growth very metrics we're potential solid, closings. still in in, the for

at we still we're continuation a a continue strong that particular point. this probably been rolling of a growth And to a very work line it's in think amount I of on. four to for really we've when that seen product large had or with five quarter, activity quarters sitting

Lindsey Alley

in I system. assume there's the the with pandemic of since has not respect changed. And deals consistent how sort think through velocity to I'm that velocity, quickly moving sure mean, just been any I that notable change been are

Devin Ryan

kind business seeing coming positioning win Okay, excited big there just in referenced. kind terrific. you're great coming longer involved know as in. the activity to to the term China kind Like, event to marquee a intermediate-term off of could in and that? that's moving from then a that of region that? about result But be be you in and structuring that Are the actually of of I here? as be over see being is maybe there the this, spillover meaningful kind uptick opportunities driven will of new a the in you And this direct activity, that obviously heels is there from actual

Scott Beiser

and now, sizable for two been we've back, step a in region that decades area. we've to probably close in mandates very other out the Taking had

help player quite the think probably continues isn't brand and sizeable believe that help of And with we've that just getting notable had. the continue engaged out out reputation. think area. current market bit share in ever today's And build like obviously this hopefully a which So there I to been I project first dominant and continues Asia in Pacific a we there's on that marketplace, opportunity the just restructuring like one in we've increased a to there. most and the It's one to us,

Devin Ryan

one here. in more I just If squeeze quick one could

of a of update. if effectively, it's GCA commentary, can take ratio components you margins, time, kind of be the margins you So and the sure non-comp But just I thanks that. that. And would kind to then time. where like I over it take saying for up think a improvement comp that toward Houlihan on bit a I you're there push for the forward? just caught going of Lindsey, margin sounds feel get non-comps, GCA’s that make kind I mean, want you Lokey’s which timeframe to meaningful is like can you on of

Lindsey Alley

I the can't done question very your the of we that deliberately. want sure mean, non-comp. Yeah, is make I to I integration answer mean,

at it be it And bankers the as to so can that non-disruptive GCA. is

I as happen to we make So think need as that to effectively. take going we're long

kind think to think to a able ratio compensation, bring expectations of next heard quickly But how quarter. how from be I the kind non-compensation of I are take a as and them will as to we it our you fairly traditional long take. with specific no correctly, will to traditionally we'll ranges that respect standpoint, yet me and compensation have while, operated early as

Devin Ryan

Understood.

great. questions. Okay, my for taking Thanks

Lindsey Alley

Thanks, Devin.

Operator

you. Thank

Our next question the of Morgan. line with proceed with your Please Ken JP from Worthington comes question.

Ken Worthington

afternoon. good Hi,

the corporate in Houlihan’s do finance How what Just the you worse? in the outlooks us the it sort comparable? it And those seem businesses following sort to relative for near-term? if for compared up Is backlog a it GCA, to Does is, of GCA’s how would it on the give September Is business compare revenue possible does of all GCA be and see to backlog? it two we as quarter? better? look margins is sense at of

Lindsey Alley

to Lokey business. to of respect to backlogs. backlog, I our two very Scott's tell Ken, September in is about their disclose you in consolidated you a that comments away And Houlihan GCA I in GCA But only to think think specifics the have not decided think will around momentum the firms momentum on the going with from pipelines, I we're we stay similar significant business basis. quarter. So, separate for terms can

Ken Worthington

Okay. forward you think to I'm it you see the synergies? two is I in of And comments, then, don't of as that to sort if the call -- can and you those takes GCA, to think deal going the one infrastructure And, most it hear critical can to your moving do so on place, sort you you us I know, of integrating the success? years, what give synergies of about sort critical how deliver put

Scott Beiser

perspective we're do, view call themselves to organization, looking vice what versa. their want along product, you we've banker industry both retreats, get a to to From sometimes and to people ours had our organization and really together that's people the numerous events, meet geography sometimes get along And as sectors, in whatever sometimes along it. relevant is welcome them why

everybody And more along the get to to people so to already combined geographies, capabilities get business can we're pieces hired be of That kind us better collectively pursue, believe, of to on to put sectors, industry products a introduced better projects combined that pro forma basis combined results. enable able the so that exists. on we assembled execute will with and

So, much procedures. people CRM all or have dictated or platforms, integration back The whether get how EPR are different system, policies capabilities classical different the know oriented, more kinds is everyone get with people that's of standpoint an a of timing a of from that and deal costs can to you you office is when obviously, to quickly else.

can get and the know they via zoom, via on doesn't trying mature what our person. to the happen in get to email, side people a couple target can and where to happens, say, how via understand we'll it's quarters I call, on get really, And everybody really level. year a get it an And their possible, to minds as colleagues how we're on take right it what we this a two, quickly overnight. to or that's as up think know but banker call So

Lindsey Alley

the add a able transaction smaller heard much in you've I'll acquire, larger historically, different premise drive acquired about that's thing of And we can we transaction, average and of and is being that have one productivity that just platform the this bankers to us Ken, companies. this, fee. and higher having we by aim terms say And size

improvements think, in around expect GCA here, think actually space. both technology. to at to ways. level, technology it established particularly tangential works the bankers I And there productivity be is well we the that fully I HL are

to the that a think so can but technology a platform GCA, be that in we quite never technology, have we around going is beneficial respect help their size only kind of has, practice and expertise, but not do number of larger size the we our depth the around of and technology with bankers to think of core had to work And GCA’s space GCA particularly

Ken Worthington

And using sort language here bridge if sort of is success? do to you communication sides? Are answer between language a What's you that that? how to both the barrier there? of technology And is, do

Scott Beiser

that also North there. most GCA, countries in in itself, a bankers spread doesn't all overwhelmingly, language or significant it with other of are that America of of you either do presence through English, things But, in majority Vast first and tools major was use There zoom these geographically doesn't enough English, speak and good are organization anyways. Europe, very their barrier. become operated the out English Asia. as a and we've can

for don't the new issue I brand the historical is GCA folks. think folks, So or a either Houlihan this Lokey historical

Ken Worthington

Great. Thank you.

Operator

Thank you.

the from Yaro James your comes question proceed of with questions. Goldman Sachs. next Our with Please line

James Yaro

afternoon. Good

best that's business? repeat the Could could have performing us if with much understand And best by for your very well be I how M&A areas was this you business sticky sponsor you on one driven of of sponsors informative, touch as FVA. relationships think quarter So drive you could the how just both sponsors? there the one market out clearly of and the franchises as help

Scott Beiser

touched a sponsors. our by definition family so our we XX% mean equity, it's funds, of broad of hedge funds, So, always about sponsors. businesses we mind approximately said mean when And sovereign we've private or in offices, sponsors, so are wealth

they're parties, it of our Sometimes And of work part more buyers of sellers lines. They're of of happens party. franchise. do a a businesses, they in provide sit the and and our of sometimes minority they They a much them. lot creditors influential big restructuring and for on of opportunities, we'll businesses, valuation product all variety committees are controlling the

and yours clearly and organizations as is can to last many sponsor of community expand those quarters community, goal we're in amount with sponsors oriented the the Our we to looking be we many been sponsors so last services we always like cover, relevant, or to over and to, to increase that making helpful results of others noted the we've incremental can the to look which has the provide active by I continued as we deal arguably our couple and And cover two. really are number think over the them, issues, financial well as transactional very that sponsor and of decade the last has increase and is has especially helped been presence to our year. think,

James Yaro

question And Okay. whether is there is forward? going to the the from saw FVA, of results able continue, this perhaps and and be to some record whether sort obviously a expect the outlook was then I accelerate again. results guess you in seasonality rate run

Scott Beiser

at have always basis, felt, level I least So, some on we think of consolidated a we've seasonality. do

the has minds, to single our fiscal very five been and FVA been generally degree, every some have it seen third and positive and I quarter, comments, typically in better quarter, I quarter. some better. do And seasonality. of You it fourth that to in quarters first What also that second mentioned fiscal our over literally, think, in continued last, it's and ignoring our grow my seasonality has

issues they'll you grow business tell like point. a won't I But this at at continue momentum it's think, got business today. got feels the that of they've where can profile it's a seasonality hit never from lot some I that great here. it to

James Yaro

you. Thank Okay.

Operator

you. Thank

the comes question. next Our of Manan question Gosalia with Please Stanley. Morgan with your from line proceed

Manan Gosalia

for can or afternoon. which good the on side? Appreciate for the and instance, relationships all Are there any detail valuation restructuring you their or the use valuation geographic on So on side, the Hi, restructuring? corporate helpful. very synergies reach finance are GCA the maybe GCA

Scott Beiser

in addition on focused ever the weren't bankers side. the think restructuring far have we at side, On to going all more also hand, the in they did corporate presence than -- the FVA we primarily, Yeah, well, on be in really finance of one the GCA Asia, them we of and bit historically the but think we do now a can focused helpful which clearly they're skillsets. have. that additionally and they'll have have bring of some cover. on same valuations, level have in valuation never restructuring, They thing Europe we same they've connectivity, we will at don't relationships, they happen we brush work, not the the Same that of we relationships, parts little but to

in, is the revenue to number new we sectors they the different I added that going of so, areas on And bankers well this other as mentioned some drive well. kind participate think in of strengths two of synergies geographies businesses, as as to industry deeper in

Manan Gosalia

can at Great. perhaps see inflation do Thank and impacting issues and to the supply on you. some it companies And pause comment chain how you maybe how Or to see integration you they're out? impacting also that vertical Is turn it is perhaps the activity? restructuring driving conversations on prepared better the And for the side? more looking companies future? are ensure maybe things

Scott Beiser

So, too tell. side into restructuring to enough impacting companies distress, starting issues, to early supply these negatively I'll may I on dialogue business last tip will chain think critically is some take are more increase chain these first, Whether true the side. long supply restriction issues and which the

C always otherwise the out change, either to always financial the concerns there's things pandemic, there whether practice, sponsors. it's suite M&A interest there's political the that about core something rate, supply chain, On in become or the topical changes taxes, in

client our transaction, least now, Sometimes but sometimes to causes I'd it delay. base them it at do it's or overwhelmingly that tell to of clearly slowing point, want negative not financially accelerate you wouldn't topic driving say to it's it's a client it's causes but positive meaningfully need conversely, a topic, our something that prospects to them quicker, to Right It's hugely base. this there, out impacting down at I deal. the completing a or

Manan Gosalia

taking my for Thanks questions. Great.

Operator

Thank you.

of from question with Michael proceed next KBW. comes Our Brown Please question. line with the your

Michael Brown

timing, just I fee a success restructuring in terms Asia little you. kind think being in the hoping there I fee? Lindsey. China. of nature structure about mainly immune do Thank of of market lowest to have trends, those a Scott in the Hey, Great. fee the advice typically the bit rates. similar a the restructuring as they to similar about And the think has and market? kind was given have ask M&A, mandates when Is And it U.S. then of there the terms rates fee of you

Lindsey Alley

on and in on how transaction on average fees are disciplined goes our and I approach, to both for. to of to than Europe mandates markets. on in take have and any China that whether the is, data the a think it's think China have your the than other is far are what don't long are or restructuring or we we even it restructuring transactions that in answer the handful the trend there it's fewer the similar, say in U.S., take question simply retainers, to hard points. we're have answer experienced vast we of hard And depending said Having is fee there that, occurred comment transactions majority Well, because on a But, to the market. is and second going it's restructuring in enough monthly It's is that look, lower bankers success, profitable. are their

think with one are a where certainly to that. we're bankers going of it's deal. do our drop significantly these our not willing to situations fees just respect just We don't to So win restructuring to

Michael Brown

GCA. the Maybe That commentary just all I Okay, appreciate And on for one sense. me makes there. more great.

down, managed capital could the to is it? you've keep count to think least this to depending last the historically, share Once fully prior year’s So count to other still right GCA flat impact including at of your way about potential that that obviously, integrated, any raise course, longer-term, retention is share your year. the compensation, and acquisitions

Lindsey Alley

like us I looks for and what think the flow for the future. depend on generation acquisitions going the to it's in opportunities cash

to while and large a integrate. still But is pipeline of we acquisition this that at. a think transactions looking we're I take a have may

historically, around do we going we part share If us the maintain acquisition, a our depend small so because next of of its likely relatively amount very on think been excess to see way to to nice the we a a cash, it long we will then when result being And increased profitably have integration, acquisitions because shareholders. can pause you have deploy buybacks. for

opportunities And to were strategically the in towards we'd there trend to we rather versus smart to of share where that, buybacks. years, flattish think see kind accretive three put acquisitions or we so, to some went they're those said down wonderful a we if Having you shareholders public. money doing there's acquisitions, if next out they're back two our acquisition might when flattening a and

depend it's opportunities part where on two going in next to So years over of the to of terms we cash. three deploy

Michael Brown

I’ll sense. Thank leave Lindsey. it you, there. makes That

Operator

Thank you.

your next question. from the Please comes proceed Wolfe with question Our Steven of with Research. line Chubak

Unidentified Analyst

hoping… [indiscernible]. is I was this guys, Hey

Scott Beiser

you Can your or you. hearing time speak hard a mic louder? having little maybe closer we’re get Steven, a to

Unidentified Analyst

Sorry, apologies.

Scott Beiser

Got better. it. That’s

Unidentified Analyst

guys. Sorry,

by So what the of bit unpack to increase hoping deal. get across you've is it a can Is up for sense elevated it of driven impacted forward. current pretty the in services quarters, I you Or has the deal how the past industry? sustainable a of terms Just in moving advisory move trying level is per size? was reflective effort that level a demand substantial seen an the to for couple uptick?

Scott Beiser

But in on somewhat year So the rate we're least organization, year, doing our or at note, a two been increase. and don't increases. the has or increased think one fees Of has average the the this been recent and going is I quarter you what phenomenon. almost productivity. allows to single size company for one we're for every decade tied last the are to close work increasing getting size The that of have this

we were that the helps, rising, But of three positive as think marketplace bankers, ago, a than maturity I or combination cetera. themselves, they five ago, the talents do yes, today of mentioned. been the considering that them are two. multiplying they're decade more M&A the constantly I prices talented to years something a in of a continue have get you percentage on, pool of said, last small for like certain we start is have, And it's together, et by we're those asset grow. increases long believe even years that once this I productivity. processes pieces working And if you we Clearly, of our to group have many increased et banker they're cetera. I all make

tactical lot and its go decisions executing and how of I think we and market about business. the a Some it of helped by procuring is, clearly the

Unidentified Analyst

color. Thanks. great That's

activity between sort mentioned follow-up, sort similar my at was around range run where that thinking you given Just XXXX XXXX. -- running And year you and potential I of think how obviously we've wondering depressed, activity think prior in prepared how year? we a floor seen in the remarks fairly activity revenues where levels, is remained guided in has of for level pre-pandemic. for next we U.S. As to I and the quarters, you're about in evolved to next just has rate-ish call also China? trying it XXXX restructuring the levels acceleration know think the -- heading of this while into of should should

Scott Beiser

look at million historical historical Two we've trough, three comment is, previous the higher decades, and every plus probably and our back each Under you but than than it. $XXX going our of rounding, between somewhere ways been cycle in and think the has of $XXX pre-pandemic, been I'm definition million to results, seen, about trough probably I restructuring revenues. make we've higher annual can and next The would is each peak. previous ever single peak

sure will crystal exactly with be not spread But market a debt new quarter leveraged the much globe. trough the significant you several we maybe and or today two is was here's two. year companies of the a it that it than sit greater be. have across is number a years the growing, amount there ago, of And ball therefore skewed or I'm where can always So by tell

low at We are historically clearly default rates.

away probably creates still So the take whatever, to going out would control which comments our of and there exact timing se just to here, will eventually of it's some revenue market eventually my us I is increase do walk that work. default rate, from in our peers, incremental incremental there's business time None of before but destiny streams just us. are restructuring that ourselves for bigger, for per more

Unidentified Analyst

Great. Thanks for taking my questions.

Operator

Thank you.

Our next question comes question. with Jeff from Please proceed with Sandler. of the Piper Harte line your

Jeff Harte

with a I productivity look looks Houlihan at. at Well, at hit, from GCA bit can guys. of your least it mean, yours? looking there lower the still if have questions toward lot I moving really the afternoon, than the we we of we MD it you previous guys. for I'm quite Lokey, be compare that? experience at but is Good think as kind acquisitions? And When this How key what that's case, what's mean, MD to GCA versus been does one of to calculate, productivity to a should driving

Scott Beiser

all, First I is, will we're business at looked that we a results. buy small or think acquiring of whether produce we've always hiring big or can profitable

comment. incremental comment in everybody per of to revenues they pay at peer short the metrics uses, transaction we skills they before. which sell have have add lines, what produce. in that what We add or off tend hung others activity we've that you that the what clearly from industries. so has didn't MD And call looking we a as on we availability seen So, and of That's it product multiple employee combination years, get Houlihan done. time, everybody may almost to flexibility done, couple that is, versus I'll incremental we of, single connections per we productivity revenues the effectively not reasonably increases second financial historically an and call And everybody every historically blended that acquire sponsor first geographies, of I'd enhanced it but a add platform you're up Lokey period as into almost over our for depth a becomes of whatever bankers

use. with in expect will other that want accurate, comment we slightly and had historically, it in whatever clearly higher lower grow they've different continue all of And They're like seen up question metric front different some some to transactions. per does your revenues is And you head. slightly we've to and per improve geographies. revenues So, while produce businesses

Jeff Harte

Okay. just I you that potential finally, Thanks. I and And cash million ultimately there. with get so of try The increase for of looking spent should $XXX authorization you can as looking what thinking Or at cash it at GCA, over I cash XXX it versus off least seems out, after you're to level is being to the the GCA? be have guess, guess buybacks that Because use now mean, Could stronger a for position time? the million, maybe pay messaging you we kind in reloading balance at is than when cash I'm the it that be it on the paying we thought something? was. looking looking like it sheet

Lindsey Alley

reloading, I quarter. our quarter it board meeting it would which up happened occurred ended we quarter, it take doing last and think, that I this last a during as just

in year-end just our of reloaded. to kind look So and the relative it course was we it ordinary we took at a

Jeff Harte

Okay. Thank you.

Operator

like comments. this to the time, turn questions. no management and there Ladies are at further to back floor you. gentlemen, closing Thank would I for

Scott Beiser

fiscal forward everyone coming look XXXX, in XXXX we this thank I call, all to updating quarter quarter we third progress our discuss year you second fiscal on for want when and our our winter. participating results earnings to for

Operator

Ladies and this you. concludes Thank conference. today's gentlemen,

You may your you disconnect Thank time. participation. this your lines at for

Houlihan Lokey (HLI) 29 Oct 212022 Q2 Earnings call transcript