Moelis & Company (MC) 10 Feb 222021 Q4 Earnings call transcript

Company Profile

Participants

Chett Mandel	Head, IR
Joe Simon	CFO
Ken Moelis	Chairman and CEO
Ken Worthington	JPMorgan
Brendan O'Brien	Wolfe Research
Brennan Hawken	UBS
Manan Gosalia	Morgan Stanley
Devin Ryan	JMP Securities
James Yaro	Goldman Sachs
Michael Brown	KBW

Call transcript

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Operator

Good afternoon and welcome to the Moelis & Company Earnings Conference Call for the Fourth Quarter of 2021. All participants will be in listen-only mode. [Operator Instructions] Please note this event is being recorded. To begin, I’ll turn the call over to Mr. Chett Mandel, Head of Investor Relations. ahead. go Please

Chett Mandel

joining and for Moelis Company’s & Thank quarter us XXXX year fourth call. financial full you for results conference

phone Moelis, Ken Simon, today CEO; the Joe Officer. Chief Chairman and Financial On and are

begin, identified this may subject from on to time-to-time we remarks which and risks forward-looking call I’d that contain note Before the to uncertainties, made various statements, certain are like including those currently with anticipated. Risk in firm statements. materially of the filings SEC. section Company’s differ forward-looking Actual Factors obligation the from no & those The undertakes any to could results Moelis update

Relations to references Our to understand other with comments required investors GAAP The on firm’s release, the results. today measures. certain these discuss which our include information with are can in when measures, Ken? to compare to our will measures, our Ken believe financial operating call by presented to comparable better together over measures Reg Investor at information of GAAP found We the and financial is reconciliation these provided now turn results earnings to website financial adjusted results. relevant be the across investors.moelis.com. I useful and G our adjusted periods several

Ken Moelis

& I'm was XXXX outstanding Chett good of people. year efforts and our this Thanks afternoon. and proud we past year Company for executed an how Moelis and of the relentless

record grew XXXX $X.X We all and from billion year's and year prior we're our exceeded full revenues XX% adjusted across performance. regions. all products Our the year-over-year of up

of class in shareholders. activity. of a year significant of capital and the last We full our capital largest firm's we Director restructuring the revenues levels have also banker history, return its now we produce exceeded own M&A in to and full XX%, record pretax allowing achieved us highest a on year's Managing XX to activity Our history. margin is markets promotes, And total which amount

we XX% Joe? on talent out by and through while XX% and one the Joe call total per Managing annual continue share of to by share be compounded Directors our turn dividends to expect our back our growth laser-focused offering our differentiating you and same more. now a firm to promoted and have of In fundamental been financial some per discuss we've internal and rate, internally XX% current development of a revenues grow highlights will also integrated approach, organically Being on part period. able our been five-year who this come fact, through an nearly our growth advisory to a strategy. earnings in take over that paying I'll over I'll $XX.XX strategy growth

Joe Simon

Thanks Ken.

quarter capital fourth and were year to reduced of taken transactions. adjustments full in were markets. positions certain the equity revenues largest during third our M&A driven fourth strength of The quarter adjusted in million client performance represented was There facilitate non-GAAP related inception. during of revenues cash quarter, on quarter the that lieu revenues of continued $XXX by that our the during and fourth mark-to-market the firm's since revenue First quarter to

year, XX.X% adjusted was ratio from first Regarding full prior in expenses, our for comp and the months expense XX.X% nine the year. the down

with levels of we transaction full of due ratio continued year, the non-comp discipline, activity expense partially increased X%, levels. associated fees largely a related to For reported by low offset travel,

$XX first best at quantifying effective for for quarter by of rate a was Regarding above month, one the XX%, our driven the we approximately was difference price thing in grant related benefit vesting to rate annual expect for dollar approximately cent. be benefit in of of EPS impact the to later two-thirds of XXXX year the of quarter this of price. each excise equity-based XX% tax of tax and the share, RSUs the the related Similarly, compensation benefit we taxes, a a and recognize price delivery approximately between our normalized should to corporate breakeven the tax purposes a primarily tax recognized the

allocation, XXX% a including capital. through excess returning we And of we our approximately I'll XXXX performance it $XXX have funded declared sheet to we respect the dividend turn remain balance with committed continue lastly, the capital now back repurchases. debt. share Regarding to returned Ken. will to to year, and dividends no today, million With maintain And fortress

Ken Moelis

with and the place activity of cost velocity summarize, globe of a The takes or clients. all our a M&A. to in company's continues growth essential And our becoming advisor to secular must base, breadth seek expanding the size investment the most these by the growing now and an and But founding to in the as fastest is across as of all institutions has these global transact to as to M&A. But of businesses all lifecycle Investment for been Joe. have synergies. significant and to XX sectors. institutions levels their dominating activity has firm service spans advisory and the institutions. of shift recurring part portfolio client to at primary their and ago, I their platform. case of used of M&A offering investment addition what a Thanks funds stages These structure. growing business them become important there's result years plugged We've pace, they have requires market, rapidly that been accelerate require. of Historically, an at M&A capital that been into be of aligned who's tactic think companies completely many Since a for and the

to our in dynamics our market XXXX been contributed result, in As And never that the has to success ability execute stronger. a place. remain

ever of and today business a pipeline any level We have significant large time last we've new pipeline a year, had -- have larger today a ongoing than activity. we

with for it up So, that, open let's questions.

Operator

is ahead. from Worthington Ken JPMorgan. first We The go Please question will begin question-and-answer the Instructions] session. now of [Operator

Ken Worthington

quarter, Hi, big constant I XXX. you good question, of of bankers afternoon. to about number the quarter, sort to my course, of And multiple being growth years. Ken, asked I over show last think this some

in new the it mentioned the internal of sort that increase was you've not, you consistent time that You internal Maybe think supported than seeing out to more level side? the this is levels? know, of remarks, years? that given what the thus Is of I biggest higher break to promotes? if senior we've on well? you're for class attrition seen of banker it far. bankers terms couple And past expected to on know, in promotes attrition, higher for based to prepared of sort happening typical is of that first, And what's the as You levels

Ken Moelis

have Okay, great expand believe and the very base now get into continue also of talent there. and to a that, group that. answer yes to from is feel that in wonderful to I we I strongly we're actually position a I'll

The think hear point do I I about is a of attrition, that about your little X:XX on on There's Now, afternoon say about can attrition tells Ken you thinking for lot us. an But our is very somebody get at get in we always attrition things coming? at spectacular when to look see life, to this, me year insight. was last numbers. they're that, me let that there's

X% extremely and run we look, are the transparent. numbers the non-comp fairly efficiently company bankers, our For

our way, or group that, pay see people And by think the the lost here. of comp of The choices. XX% to in took I that work addition $X.XX I is we and put place to motivated, non-comp comp. non-comp, it After energized, the I a two got your One, people banker, energetic of shareholder's and the a to whether have the if decision can you $X got between platform. to bankers that pretax. revenue into would I other an want for were have

growing a market have that's dynamic surge I can as get as we're to look lot think and is young but a both it's -- I to unique. the way, as have around to recurring, say M&A has promotes by the I in primary a was topline we hope think not the get firm think where fairly I we investment it business are, my there's continue year last that So, people career. the I and really delivered strategic -- go you'll revenue of want history who we team our unique, people, where we good matched as street position work great and this incredible a then I in now attract believe at in where we And and of bottom-line. bankers are I see And we're would to banking, want to -- to but be well think our our the who both the to that internal bottom-line

Ken Worthington

it. Got

year for in rising outlook know, from And XXXX. we different, things transition then versus two as just maybe forward Maybe Okay, leadership, growth there be look a years. rate up thank follow two, the that value. we're to one, the on towards this seems in and last a to environment, are you Maybe interest you.

XXXX driven, You're strong change second great, the the that And record of business that this, the great, really, you outlook half you environment the some these diversified, that's in seeing even know, seeing the maybe of of we're know, clearly either today. levels versus do activity great really today. you're year, sponsor in pipeline, you driving kind know,

Ken Moelis

going there's on look, interesting. crosscurrents Yes, I think several there's, that are

hired, because we cases quarter. predictable backlog, largest over we that a unfold your the most months, something To probably I in visible, is the one get nine us, a be. pretty of lowest of believe, of do end interesting, usually could restructuring pipeline backlogs predictable and ever. in at we have think So, that, like -- And it's the our restructuring. And and very have we steady year signal businesses, I you six, the third because it's

but that you so and coming what -- have down. we saw So,

right I targets. and that M&A is essentially it restructuring believe that, restructuring. interesting missing call rates not very but change me, replaced, has ability, yet. of there very To many interest it, your has aren't might light the, So our the now all rising And point, backlog

but and December, that in the I, The started think even of what value than out quarter. December the really, it's in longer. to has better And volatility. geopolitics change probably second you we is, see thing started the according a probably back the to to activity pace definitely in are high, closures, the from it closures taking extremely an elongate fourth the we're We just enormous the quarter. just that in immediately it pipeline is or that other guys seeing, this half even The bit, is growth, of very some and track fair little of first week but level I interest to it's can maybe seeing you all third Ken amount rates, say of caused

a it, see harder, seeing thought close thing any weeks. weeks, seeing We to little So everything on just the week you a pipeline, that I longer, say quarter. And out next tougher. shouldn't working you're We're a pretty. going you lot way, closed we dropping we little a is or the we see see know, little first in we're don't just in is that four By of anything. the three that don't

So they volatility. although than of busier pipeline year. quarter banker our seems seeing the high, almost definitely I every and result talked first extremely pace a slow in We're remains were of to, the closings last Pace, to as be

Ken Worthington

you so Thank Okay. much.

Operator

Wolfe ahead. Chubak The Steven Research. is from with question Please go next

Brendan O'Brien

is Steven. Hey, guys, O'Brien filling Brendan in this for

putting seen thinking be inflation and be to should since with has going of onset base pandemic, and pressure operating return quite years? XX% on growth as as upward expansion the strong -- recent where your peers, well substantial been how plus about margin likely of we've So, travel environment cost but in is sustainability as to we as revenue margins what not the revenues the

Ken Moelis

I to be think sustain. we should able

you think pre-COVID, Joe talked do points. -- to it's three or two? probably if you I about I two probably travel is think, travel Joe, back what -- and went

Joe Simon

were I we're probably if got as XX% Yes, XXXX headcount. pre-pandemic of we've XX% mean, more levels, and

Ken Moelis

know won't kill that model it's in I going that leverage the so substantial. don't is the back, And

the to, to listen a our single my in of has there's which plan remarks size, double a customer I suspect you in to the actually the to flow. size. large base input base customer group -- that all calls of be is I information, leverage out everyone need I has alternative a show transaction that fundamental one asset would a but where to described their manager do, think large I the them model. I flow, to their the the plan every ability believe is don't deal double the is they and had more almost

about talk an have fantastic. it about was a way, excellent, the pretax absolute good level people, was we on by are very to feel me That's it you that and our -- When you I getting some hit So, that. talking, was of XX% but believe margin comp out ask inflation, and was margin. I might

XX% my much we stay at positive me XX%, of number in help to as can stay very gave a Now, but I you would excess no, XX%.

Brendan O'Brien

Thanks capital outlook to equity and of some business business. was you you your lot guys had a great That’s raising, the for in obviously But for color on markets, advisory Ken. this changed, success year? recent great a around contributor I And that with issuance volatility hoping color. of parts industry slowing during meaningfully of on that going how could have meaningful results past your give has was wondering how tackle was a whether us

Joe Simon

way. to private a go to started provided to it based I shares plus contributor, go they minus. the it if you have public people to mid was I big not when it unsure that things -- IPO markets, double and doing and finance, go because probably out get look, markets you're file make the there to I out was structure, we're we're structured think, volatile, they are had distribute doing set competence, double-digits, public. not to and the In a like regular some markets tremendous into XX$-ish, or Capital -- the on document ways we think markets, mid -- Remember,

COVID, of If you're private. beginning was the were people it uncertain, at structured when all like uncertain,

large. that taking from class, very credit alternative will these it's Really, in getting everyone all it money. tell you five I'm a The today, players, growing aggressive still -- managers and look has of would asset what's significantly, creative almost a they asset and The or ago to you, about bullish most So, are to say, be about credit again, you if markets that. I different down and alternative fund the them are has asset do very things. interesting and substantially want years probably credit at

Now, that's buy they structure. they want something out rated go where A bond, want to and not

really be very I in a every -- affects things to I volatility that'll short great long pretty of think lastly, for -- business. what volatility always be do volatility, good I'm look when decisions. again, is this significantly run. the that'll period corporation the a So, makes And time, make back, But then

eight point then and had the -- and people was flow, months COVID COVID is have -- making I be volatile. over that. a there'll years. business might even come and business. people But the and first to and the to of versus make the weeks. different the by future, world helping of you forms back we're So, of not horrible with had for that can usually negatively maybe near had back decision what And extremely a and make was nowhere a on the leads if said, to -- Ken we way, great, real it volatility three a then two want of growth people focus last years that decisions lot But the cash lot was a go-to-market. we the Even are upturn -- I'm their woke up, revaluing strategic in comparing we've our to to bet everybody two decision a it had go I strategy don't great of and about this happens crisis,

well. markets will that answer to pay, I I markets capital part a that. be small to be and key it's to the that capital mean, will think, So, as short of price

Brendan O'Brien

questions. my Thanks taking for

Operator

The go from next UBS. Brennan ahead. with question Please Hawken is

Brennan Hawken

on taking Good into wanted afternoon. Thanks dig Ken for your question. to backlog. my comments the

So, backlog you viewers it. history. -- we our in Got biggest said yes. But that it's the --

So to announcements pipeline slowing have the that we're know has public curious tracking been you slowed much -- if like public like closing has recently. indicated I data, looks and but very diminished the pace public the and when

a So, I perfect is on and directionally swelling there to front are but sort unannounced reconcile deals two? know between of on the double of in therefore you're that included working are there's proxy, a in the backlog it's like close. usually public help that your that kind us order never

do those metrics? how you square So different two

Ken Moelis

Chett with looking don't just a everybody of our a external, have encourage being is look, whatever, spend is that. them until of Brennan, don't there's a mean, at taking time that time why wasn't be that -- -- so you no announced you somebody I very numbers, able I've they would has might public But, time look announced that. guess. not -- announced. morning. And I'm spend of are were that. would no lot be we essence announced I'm we of lot because sign I my yesterday look me would question, the looking things And that almost until not work M&A, do any Joe about at and at, those, that not problem you public there and to this there numbers bridging I asked whatever market. spent I seven the help on -- deal

also don't And know, And very how what other the so I than activity, we much engaged. know don't reconcile know have. I -- I it know to the I again, bankers I are

bit, causing think you're conversations. what seeing the those a churn things I little to is volatility all is

it actively still discovery. engaged time might you I But of in the now, and you down beneficiary I your trying could stock mean, and that, to be have should I gone buy were you're stock you I the need if company, have down, price feel make to other's we we're wrong shouldn't, right. right in your happen. And XX%, for trying might If feel gone each might industry,

looking record don't healthy encourage is I the but I to backlogs I restructuring to is I as an think see answer with because I'm we -- know know not our bridge it's are, again, record near you, and it. -- lows what I you But I'll don't said how amazing we're to going is on just near record tell part lows, say would that's So, lows. what what the at

Brennan Hawken

Yes.

trends, about when pace of Maybe -- color. And announcements we've direction, the also, and of data some up out most this from seeing our the your announcements that the to slowed. and approach year, we're the is try out? the same maybe at bid/ask that for not seeing something at industry and are -- specifically. spreads of certainly to isn't a are for data, it But some seen Thanks as all Or industry to it XX%. some when maybe Okay. got sponsor about And you different can activity widen, to start been perspective, at you that have and looking some cost, there curve, this industry seeing financing of trend higher we've -- needs seeing really else? time show percentage analyzing the that the some that broad are this you at settle actually forward from that and data? idea decline. be in we're -- are looking in volume, seeing, that the time market seeing But Or working I'm sponsors XXXX quite the elevated interestingly, here the of a I

Ken Moelis

market probably happening. to Giant sit. That's

businesses, to came what I of ever very equity go get deal? over and that'll First I thought and and private went weeks mean, who's six passed -- thought, or went I about roaring back about out Well, -- seven weeks of I home going let again. thought six a again, do the home all first COVID, to quick. their but

that Now, we're of nowhere near volatility. kind

be is going may we think conversations I -- growing. have there sure Their AUM, on. lots some of I'm

So, especially away week what any explain happens period, in volatility. or again, there's four five when

fourth I to volatile, closing. to the pace slow pace much it closing, sometime think it's There quarter, explain. think you somebody so almost talk think will or third spec the think I are even cause of I the the about SEC in -- differ. really started things too can things on, of It's going when kind down to the

I think things that was almost that. accounting purposeful and like on approvals the

maybe And it the definitely things happening those at now, second the there. it or are -- happened And week. over So, of in it we'll started maybe all of eight definitely coming it last we're third was December, see. out weeks. middle But

Brennan Hawken

other Is might like losses. for question expense one This be tied $X.X activity adjustment Crest a goes million to Okay. for a revenue from Joe? a back some There's Atlas Joe. the of that into reclass unrealized

Joe Simon

part we the have in kinds of that of it. we of and That's what these quarter -- mean, fees, cash-- we them third we Basically, facts in ultimately, -- I was is these that said had lieu transaction took

Ken Moelis

specs. you said Shares,

Joe Simon

ultimately I'm shares, until and revenues them. we right, Share, sorry, we those monetize that reflect through would

obviously this And an quarter, a we would impact on have reflected loss. that through went So, mark-to-market which well. as revenues, comp

Brennan Hawken

some there looks so was but know reversal? there really also part on you of and did tied it initially, I then this reverse was million the the to you -- on was took enforcement adjustment Because Okay, like guys comp marks the it X? the the $X.X the non-compete, that's

Joe Simon

that and adverse. X X or reclass what was to exactly revenues it million is million was so about, Yes,

Brennan Hawken

Got it.

sense. lot. Thanks makes that a Okay,

Operator

from is question go Stanley. with Morgan ahead. Please Gosalia Manan next Your

Manan Gosalia

afternoon. Good

rate So, restructuring we or Ken get the could early that succession of from but the up several levels. went you're hikes on do see be different zero. then a that's side, low from we bit know, ramp how backlog to well, time in you you really rise last any as And tight signs spreads on sort saw rate and here the quick from little pretty thoughts, slower being starting

opinion any as of have you like is And the end any the tell? towards go on early would to ramping, this or restructuring you're it too if get early activity it wondering of side, seeing So, where I was we just year? signs do

Ken Moelis

energy good long a things not you I if pretty don't. We're you -- well, commodity go much mean, now, seeing -- you you there's it. cycles when not early say when out into -- have it to I'd the a tell. And cycle sometimes too quick. hits, happen Right get do there.

a at the I lot and paper You're there's any right, know, of happen. anything point, in can market,

So, not about worried look, I'm it.

our good, getting I let's whole hire I the business, is let But good cycles, And know getting create I just team the -- how to can't it's helping happens. into cycle, because not airplane, it'll a not that -- I to a restructuring a tell business out But it's those busy. the they're again, engine what so I bed early, in me in not pointed say, previous rest, you the people can't just I if could getting very, think there's very it's now. creatable you, that some restructuring group. because it's what someday the cycles on it's it's -- right hit. And they're know in people how they're is, sleep, call. happens good create hope is, if hope the is listening is you our it good instant

business is think would almost good. people the be I some -- I staying There for so may think aren't as And us. to in this great who that some be and committed retirement

So they're inevitably be will resting team up we love I hope are we cycle. for what and the a committed,

Manan Gosalia

think market up sharp will of we stocks several just then their up question dates in separate expiration there year. get into them did And out enough. maybe I bump too, we XXXX. XXX stock against there's the Fair start over We looking see as of is to find this seeing ramp on the half back that a targets. here And

trending we're we go see for and as prospect So, market what overall, with rising the this already towards you of rates, activity just the do the lease stock year market and seeing, it how volatility do the here XXXX? means you of that back from end think into

Ken Moelis

players money market sharply hand be is. market And you I in the how mean, the go who stock into go volatile it at IPO is IPO had forget institutional of focused gear, And IPO now technology markets then IPO transaction always they volatile, had And a sharply thought people feel think market of was no out an with. on high pipes comfortable is had where a there I you extremely then with years non-institutional there market. market institutional and -- been favor. because and would their for I here new lot it. players and try doing their is they

-- a now, it get it's There very -- spec in have I hot we're may I time think But product be it's of a will but difficult the I better. things something And will I -- it if part doing done. you will Again, with everybody's call really we're you of liquidations. but liquidations. It getting of end, done It it I will think more cyclical. now. market And think are obviously I it's I don't quality there downturn, there'll I be back. right, permanent, that done. the be be a not professionalize. it you and all be right -- it's what possible IPOs attractive track spend very than a -- like the And an during what doing. the market price it's think wouldn't a by can lot But good lot

Manan Gosalia

you. it. Got Thank

Operator

from with Ryan The next Devin ahead. JMP question Please Securities. is go

Devin Ryan

Joe. are Great, good evening, Ken, How you?

Ken Moelis

How Great. are you Devin?

Devin Ryan

well. Doing

Just role. average the and are needs getting of advisory sponsors can want guys have obviously a and more seeing, lot transaction, just about M&A in a and what kind the you're talking to you fees they -- M&A ask so more even question an you about sophisticated

roughly talking fees the five-year are a portfolio about you deal you the fees? values and doubling And see in part Xx companies, I'm these guys view so there sponsors up, part implications deal they are markets, to the holding market, Do increase What term, bigger implies, are become a that? longer if that think on sponsor line, as those more on -- that? hold in grids, even then of was it see side, we on continue just we time how kind sponsor fee So, and of short-term if if you on playing the curious kind the maybe I'm any are what the the and previously. will, sellers of long-term hold of is think over we a over about sophisticated compression kind the values hopefully

Ken Moelis

just secondly, fees going nicely. the exact that's I First wish think happen. I up pretty to were looking back, is opposite And

in, -- of million, shown get flow, it. asset, billion key to when $XXX so -- buy billion $X to spend profit to The Let even $XXX comes years, they to worth you've and firm XYZ. team an The to reason to I have and $X access $X want to that's equity to your out the that it billion me trained second fee to private you because isn't your that whatever from firm we that say be it's get is, access like in that key you of $X billion. company through look, company, they're just this and buy And a be into specialty whole is think is the this interest we the walk getting that and success going goes your five might it's asset million. say, come want X the Y. be unbelievable what's XX% our go in and of they mean a down carried a committee

or difference million. $X.XXX billion remember, that. $X is So, carry difference making going our million the billion comes $XX is then billion $X million to -- up carry three this between to fee, it doesn't the going The $X of billion. the just And fee or matter between out I'm $XXX $XX

which global a highly say access I'd very can difficult your of that That's So, rare, the is them. intellectual unique, scale, property, extremely worth size believe capital put the being assets. places for access supplier to it valuable with integrated deliver to of to and our I we charged, information and nature part the super

the across across fact that And to I so I globe as know deliver the assets, information in for the financial products, all this this our the up think and get double, very see and the think and that flow do again, but we if commission -- that firms -- firms only I one can these anybody hard quality well. institution it's deal structure across to desire and goes it, to amount to that goes of firm of it double we flow can deliver anything ability size access

extract not of pressure. we're butts do like try any information to the to off to the get more And for I quality So, that our anything, would working if see them. value I to

Devin Ryan

Got it.

great can to be kind at that's of very on going I the -- remain stood Okay, the that the not color of overall out getting expectation you're it's just just about year, every follow-up I guidance, the comp Thanks so is business, XX% but you guys margins And margin. about conversation kind of non-comp, these to then and like kind appreciate the kind but margins on Ken. levels, elevated that of ratio think to way the not it's balance -- much.

always coming travel's of And and but if kind non-comp your up back. this absolute expenses the probably and think there, so there's just puts that concept in takes going are I about

about see think leverage from particularly to elevated, here were you you the remaining kind if even is non-comps, do as the grow leverage flattish just from come -- or ratio. comp of about on to margins remaining think revenue from or going you As

year You great able to had a still margin. XX% deliver and were you

if well. system but still any I'm were curious on people the paid you the I well, comp in side So, leverage, guess, there's as

Ken Moelis

-- look the the The side. The leverage last we did revenue it phone going bankers I wouldn't is the came margin that December leverage XX% felt call What it. is it. we was XXth optimal me to to money after comp from and taking by transactions, ratio, way still just stop say though in on look because if wasn't our of all enough in wasn't is I the -- the from would going work. not way, and that for be people last it you're amazed wasn't they work, to -- out I because out understand And need people they you'd take not get to I if doing deal going -- cap executing motivated. them, the they that

now you business X%, just we're was going not if generator, at an possible. technology, cost am actually leverage revenue think the is be line, our via we're maybe I'd the stuff, travel, cutting. a That because get didn't I -- we down there know that I done were might a And all high. if travel's the and revenue that. we another saw and I a you the commodity the -- somebody to a and never see base good is clients, once -- the That thought master maybe number follow. non-comp Zoom, because was and talking revenue wasn't maybe drafting generator, I more cost incremental in I meeting was about generator, revenue the of So, and because to up like mean, is travel getting kick start traveling

restructuring on little generation as when system production and the key They effort. have a of I we which But the team. in to I'll may and travel even about do and already part talking commodity were start -- every we're revenue. doing out done firm organization. and is stuff because revenue new have the integrate, of you execution we things, integrated And one Devin think the say, all for a relationships the to is be is most that's relationship. all this other is that's a about the computer, the of there working them getting business, And of throughout one of result come joke way are

margin. the it's line again, So generate that will revenue the

Devin Ryan

Okay, great.

MD just for for or is the adjustment Just that ending if real quick if make that'd for Joe fourth I have the the XXX, you quarter model headcount this internal helpful? the just -- for be sorry, we the is that promotes missed number,

Joe Simon

XXX. promotes the internal the at think with I were --

Devin Ryan

right I sorry, or year-end, guess,-- of as of now, As

Joe Simon

now. as of that’s right think I

Ken Moelis

But I'm if need can you help Chett year sure end, you.

Devin Ryan

it. Got

it. much. Okay. Appreciate That's so fine. Thanks

Joe Simon

of way. as now Devin, right by the Yes,

Operator

James Goldman The ahead. Yaro is next question Please from Sachs. go with

James Yaro

taking my Thanks questions. for

to in So, robust could the the activity strength environment in and geographically the environment, Europe? speak maybe just M&A remain what U.S., then you're you specifically whether looks of and like the seeing

Ken Moelis

than is hold see I'm to XX-month again, definitely I'm were going is geography, -- and we volatility. what just the up rolling I near-term you sort give which to a going on The of on Europe single view. U.S. stunning. the said We diverse think actually every back you're starting base, starting model, more definitely again is recurring in it also because same see I much and more way, the and to much to Europe ever sponsors go client market. in middle was, significant by exciting and a is up this to real on

Hong I sponsor some, good. through big the on Interesting, had Kong, had Brazil, our Europe fire. Asia Episodic, have diverse had always China, was and we a good but office and business. we you of pretty much pretty year. course, good strategics, So, our sponsor Asia think We, some office a developing our had going model. more recurring they're offices; very in I'm Middle is East which

-- everything, Middle lot be fantastic just East. good had East, India, and a a from a in it's year. the next I economy know, a for continuity the downs, us. be franchise the if we we and of everything head And good. think That's lot doing which my feels to don't know And doing everything But like the I very only that had even year Middle that seem ups in might right trend. off a now. top looks

Joe Simon

same And our issuing I be basically couple in see the the entities think way a U.S. weeks. of to going as we're rode non-U.S. that you'll XX-K and Yes,

So, the several it years, contribution still been to for was XX% in last XX% the and XXXX. around revenues has

James Yaro

a point which if there's some various would you past you've sort one, years. you one reach do just you revenue will in across bit Okay, you had But extremely that's helpful. little might your granularity how so, of the disclose about which is think growth seen revenue And -- business only think other at line, more one then still And business tremendous few over lines? at a scale that? I disclose the

Ken Moelis

run as financial work In to question. Joe going a-- to as mind, we we one my that give business, I'm a

Joe Simon

Yes, crediting right. And that think And be way. about parsing I always -- would a markets, M&A, work, it's it's it. the think various restructuring, mashing our that the to I it's because up We our organized. and exactly allocating an start particularly teams continuum. think way useful, start to product there's would work difficult not that don't try it it real think like that it very and areas, that's we've how like, don't capital way it And and not start be I and how would we're and it's internally we be

James Yaro

Okay. Thanks lot. a

Operator

with from The question a go Please is Brennan UBS. ahead. follow-up Hawken next

Brennan Hawken

of attention was XX, XX think wanted, compensation Devin it. initially Hey, margin. The direction and just is -- and great for the around to year this T&E kind an leverage about thanks of T&E in for range to whatnot. and a taking this going degree epic kind my of away pretax lot was follow-up. I'm is revenue, whatnot, curious But to this I some low I poking go ratios and of to

comp can a year go time particularly the spend So, it's of how why you this, wouldn't how we to the end given in like lower of range, talking lot about a revenue opportunity Wouldn't not be what rather, to that extra but ratio, draws the to comp and like people of model prescriptive platform generate? commission a -- it's point not that. not

Ken Moelis

we XX.X. optimal. not they're feel at we thing. Excel great Well, out they you don't so don't excited why the never asking, have -- a It'd anybody and I a say was -- pops that in if company, do be to What here. hotel, are mean, is like it's range, we've be this need about that new -- modular year -- -- a way, went I put your and people Why optimal. about managed I do were came felt think do being We these more? will shareholders you we I eighth XX.X number. asking but the do? to I enthused, I've really the you Look, the -- do better mean, reason you some get with motivated, up am trying and a I definitely like, by own it's the working stick why you this, tell Microsoft we numbers does am And the our will about like you future could every why it's just pay that? refurb Why'd rooms? rooms to

optimize this years. what make on way them next on they've The to in Xth. heroic This this it February the said are and treated was such. people February the franchise is because we of optimal reason February franchise for value to they junior did an we Our accomplished, XX it Xth what five --

to debate there's be shareholders says at different will a the I think I'd be can no hopefully way. I scientific did it Executive a formula optimize of that -- benefit believe that just because team that we way Directors all and it it And and to came then our to decision. the the conclusion firm be Now, that and did now I the try myself, of that rather But Board that. much you'll

Brennan Hawken

my follow-up. Thanks taking for Okay.

Operator

Your with is Please KBW. question from Michael ahead. Brown go next

Michael Brown

promotional my questions. whitespace and from broad When etched base thanks taking us class, of great looking obvious It's growth, where's outside. think the now? less there. and we the at Hey about that for just sectors see Ken next the for Great, to obviously on on capabilities represented you of larger, leg becomes

there? internal a strong us external a more about does the And also play last that. give bit year, then little talent. a you of frame hear of to just How let's flagged could So, if you compared and pipeline that reference

Ken Moelis

bigger, seat, billion sort embarrassing, haven't much name better. because the extraordinary look I it's two down I it's noticed me, done. I three of we largest way, go, to can I my you're all I we And see is and revenue, $X.X the or in what for and be well, I sectors whitespace. right. of Okay, and should By mean, fees. that's

see It's of substantial just look, a pool. still there. at. and have do looked a I we lot be huge So, tech. they're -- out revenues fee can pick sectors could more I lot in mean, that we one, shares to I've gigantic that the a market

we like great have more. a do what could team. but do, We I we

than block space I by whitespace from are there far. out. then like to see seen tremendous And them I've don't ones and want -- So, more I other that. signal inside, But

So, I was of that. don't second sorry, the question? worry part about Well, the

Michael Brown

you pipeline, very strong a reference that year? say compared at a frame it's a talent that it's just strong get how does wanted release, -- level, press to the Just to mentioned in of the last

Ken Moelis

two thing, and and coming. than to metaverse last even mean I I you we higher mean, said. would we're M&A definitely ago, the me, about told year you're up think right I as one comers, again, our And have your Ken, point asked you see about much in Higher. things I young your more talent have that. if years the I and would skewed to banker who's spell these don't to

lot going I'm what's down, I'm people difference. five we're even and the are years, own not having banker hiring is next space, the all know you might who XX-year saying, seeing, part can doing value and So, hiring the new and attack will not things are school of And it a I and we not a here, the industries and it's I an in up of really bottoms see that in that young it and think -- these the the finding some these energetic young, where And I online coming the more that I it's huge there's of where their and think ended you're sectors to what places people a of created banker, that's hey, middle there's lead out top like opportunity are old happening creation places in being that's refreshing that's finding niches they brilliant you're gaming, it's out it three time, opportunity up. to a right. not and know brilliance and space?

the internal the they promotion having I sectors way will. see excitement talent revenue grabbing that's shares market and of before that So,

Michael Brown

And to it then just high rate back I kind Apologies Ken. should quarter. for missed the first where commentary appreciate on always quarter, And this has one historically? after base Heard first the driver key rate where impact of the The that what of the of share was was Joe. that, for a rate appreciate the and to the terms comp. it, if quarter be tax fall expect been we then I in the great. quick tax tax just there? Okay, color the

Joe Simon

I level expect would I second those around would the at XX part. answer So, now. it to be

is two is one expenses. other I is the And it. U.S. the income foreign cases, in an items tax cases, the higher non-deductible really In income increase we coming are it earlier affecting about talking One think what is outside primarily that jurisdictions in earned increase to there's in limitations. from subject and other income the in of some to credit relates rate the earned were

combination rate And bit basically given rise so to of creep. has little that a

Michael Brown

color. that you, Thank Okay, got it. Thanks that for both.

Joe Simon

Sure.

Operator

like would for any conference remarks. question-and-answer I over to Moelis our session. This turn to closing back the concludes Ken

Ken Moelis

and time Thank see you appreciate your after you the first quarter. all. we'll I

Operator

you Thank presentation. concluded. for now has today's attending conference The

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