PWP - Earnings call transcript Q3 2024 | Perella Weinberg Partners

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Operator

Please stand by, your program is about to begin.

If you need audio assistance during today's program, please press star zero. Good morning and welcome to the Perella Weinberg Partners Third Quarter 2024 Earnings Conference Call. Currently, all callers have been placed in a listen-only mode, and following management's prepared remarks, the call will be open for your questions. [Operator Instructions]. today's the being Reinhardt, call Communications Marketing. that will and Head advised and turn now over be call recorded, is I of Please to Taylor

You begin. may

Taylor Reinhardt

and operator, Thank all. you, welcome

Bednar, Joining me Chief Officer. Executive and Alex Financial Chief today Gottschalk, Officer, Andrew are

we business note this performance and outlook. contain like and call expectations of to Perella statements, conditions including Weinberg's I'd future begin, may Before that forward-looking financial and industry

differ Weinberg's inherently are The expectations, not firm cause to risks, from undertakes assumptions most certain the and in could uncertainties. forward-looking to of events guarantees statements or are any discussion subject no uncertainties, obligation are actual and the to performance. our for statements. recent to that forward-looking and SEC update results based Please Forward-looking materially a future and discussed those beliefs and of refer statements these statements forward-looking risks Perella on filings of current

most some also assessing be will the discuss During on are the which the in of Perella will of XK, measures, there financial today's relevant non-GAAP Weinberg call, discussion performance be company's these the metrics, management comparable are can Andrew items results. reconciled release our in financial business. call which which GAAP Form press to the website. I over the now files to turn the to believes found has of measures a Bednar

Andrew Bednar

Thank you, good and Taylor, morning.

and a million QX level quarter firm's strong remain history. our the pace up XXXX, to for record at to XXXX. In revenues are in year-over-year $XXX those revenues months tracking we quarterly with And We third nine to in up full-year the revenues for firm. our the first million, year-to-date results another on deliver we seen fourth are the similar at highest are year-over-year. And report pleased $XXX XX% of reported the XXX% quarter,

well encouraging is fee reported growth an today trend across relationships top-line larger businesses This trusted driven and in of both and business new strategic a our both results events. deliberate and optimization, increase deepening an positioning by as as Our clients. with existing reflects reflect our selection

on cylinders, for themselves. not achieved. of and speak is our what I and all the have they teammates team proud more Our firing be could results

Our the the that transact solutions growth accelerated. markets. cycle a we has are franchise announced need time, liability activity signals business stages the down our Corporate of cycle, continues through momentum to remain among the early which in from in financing supported At And the and multi-year sponsors activity, lag while for high is restructuring creative in demand. to the and support same corporates, increasing. desire sponsors management transaction

we and call, back. across our client yielding leasing, We logistics. seeing beauty, coverage investments care, last industries Across are and investing strong others have consumer investments already These in two have relationships increasingly health, years, are in with and in partners geographies growth. Since added and in wellness, these personal and made client are results. in plus prior in transportation, talent, are our tailwinds the believe we trends we firm, at and

two We to partner to continued rank have that bolstering our deepen the level, at coverage internal pipeline. strengthen with additional also invest our and director managing client hires

the XXXX underlying so but an more operating in client-focused even reflects franchise. to-date improving performance Our of environment, represents strength our

a I management clients opportunity will for to to see results call constraint. drive capital feel achieve you we are detail. results review would, growth. in our we look put, We no the complex situations. superior We while larger our long-term and to turn leader especially our our providing financial more returns scale, simultaneously to what our we and and strategy shareholders. Alex, and are an advice, solidifying forward now exceptional executing over to continuing Rather, deliver to as we increased independent in successfully for said in on achieving position we Simply more

Alexandra Gottschalk

Thank you, Andrew.

XX% represent months compensation nine the and continues first to Our our for full-year estimate ratio adjusted was accrual. for our

Our $XXX year-to-date. last to XX% line continues third year's non-compensation and adjusted level, entirely million was million trend approximately $XX quarter Adjusted our for non-compensation the in with expectations. above expense

electing June part to to to tax more our stock. adjusted compensation. We XX% equivalents shares shares exchange end into quarter, from Year-to-date, XX%. At mitigate months, share retired the our unit will for from managing first and anticipate total our and A remain approximately to stock, count exchange while now shares, A million Our of combination have nine X%, we common than was and a repurchase, partnership increased million compensation resulting only share Class common of the dilution stock-based stock-based from that Class units the committed We XX that, through please full-year XX and be $XXX million equivalents, in million debt. quarterly units rate divesting for at share. With ended below settlement. in investments, Operator, float no partnership third XX cash, cash cash, declared and and morning, short-term the questions. units our we line tax for had of rate public the This XX, share net with per for $X.XX quarter Compared open our a and outstanding. dividend count outstanding X%, we we the of increased

Operator

from our Devin Instructions]. JMP. Ryan Citizens take first with question [Operator We'll

Devin Ryan

We're on been just I year-to-date against of it's want backdrop great obviously modest kind and pretty in XXXX. growth to start a a of to that's other big investment outperforming picture on up Obviously, pretty XX% significantly M&A, banks. start just revenues. independent

all time, of mentioned little a early is just outperformance you on hitting we're at but the And the of you to love would cylinders, the I'd what So, same then, in of to. in business a attribute the degree Andrew, recovery. bit kind around dig innings

kind you great from So, algorithm after are how year? the and maybe the of about start think feeling love what's I'd to just here guys growth a to

Andrew Bednar

week activity the continued markets transaction us this events in. certainly we're we're that even of more going see we're the that gives Look, in feeling increasing optimism and to good,

think industry closing our be trillion our up on So in and this price the on M&A reflected We're $X I XX%. shared that's the moves It's like something to industry stocks, of year. by going Wednesday. of in was broadly some announced in in

You are correct.

in continues We scale double faster-growing a are our story, that we to reflect and smaller business. up in the industry. more It our growth a our than fact that, are participant

has mentioned I've sponsors of over rather largely calls, by activity the As in which in time. do really cycle. than that has change this dominated with early the are think corporates I prior positioned well will we where been been, part

expanding from our more our suite services out products. continue services. also benefit to product able services a clients. We client broadened base. with as deepen we're wallet capture them are Often bit that. we We've weighted relationships corporates, our toward to set, call and of them people and more and refer the By of to to We that

sure. Devin. for line It's not way. and volatility be future it's for right. thing, now, doesn't right mean are to up We I've one any very now right of kind as firing trends all cylinders. a M&A we're it'll So, the clear But accommodative along very, mentioned, anticipate everything. And and activity very the the straight all on That turbulence

Devin Ryan

reflected market just pick always easily. that seems restructuring one maybe guys there. in then you management. get on the It track liability we of and some share non-M&A can you That on have And can the doesn't the data nice like businesses, contribution gained

have you So, I'd liability businesses much just would frame around kind restructuring your in maybe recovery? other And businesses from current periods. to perspective to frame thoughts given just that of could I M&A around confidence love non-M&A grow management. non-M&A been, you happen think that in or here. contributing with to get can a these and how your the some if businesses those maybe then conjunction And how the relative those how And particularly are environment, ability strong advice

Andrew Bednar

growing. are businesses both Yes,

up. And so, businesses both are

prior on As lines as you know, the or as operate businesses don't and business and calls, lines. we I've service product mentioned

a are client-centric We firm.

we so, how about coverage. about operate but clients. think coverage about as within geography industry And model think business. a we And the for we We think

how when strong look client does service which clients. And are covering earlier, the revenue already seeing. at don't clients the a P&Ls. and lead you said look So or existing opportunities, I at expanding we relationship of we capabilities our more product to firm We have we're line as

doing that advisory team, debt it's very, traditional I'm M&A largely engagement the service with in pleased so very trouble line. our that a much management the we service our But, And very and not other and one. management and seeing, liability advisory our a easy. increases look the but our the public client-centric analytics providing industry with approach being have it our know model, we shareholder does a it restructuring detail. tandem and integrated make I as And with We know don't with for again, we're I or and business. key product is lines sources as at on team, data segmenting have driving alongside with that team neither exact us, restructuring M&A that. liability

Operator

Research. next Wolf And we'll with take Brendan from O'Brien our question

Brendan O'Brien

of belief on Devin's acceleration M&A question, years, leading some corporate. from To couple in to that to to I Corporate over touch just want greater leading activity here. past to response start, alluded see going you something on to you're the has in been sponsor obviously

tougher to of forward? help antitrust I the Trump of under could meaningful how However, you be easier for impact a could sense that a been and the given meaningful the past the antitrust tailwind backdrop how over few has as administration, an regime hoping an expectation was us give years going

Andrew Bednar

tough some terminated. transactions it's And We've you've pretty that been in impacts. two Sure. think and I antitrust is be One environment. seen a challenged review had some

antitrust thousand Now, there's XX context a two in of enforcement year court States, dozen FTC went the been there that the an terminated you're and and DOJ. as participants a that the favor been actually several have actions under have the And so to due probably cases been well in or number transactions against in M&A aware, transactions actually the transaction challenge. only of United of

story. not overall, muscle it a To been created So the the chilling the antitrust has from impact to regulators. part has stronger the us, that closing timeline has storyline that of through been the

year if so some proposition then high-risk to a in a more because transaction trying closed. to is markets you're to get of high, the you it's announce transaction, know and participant a And what close going or these exactly a if don't to longer take getting, the as transactions you're timeline close

big get last it's, do been the accelerant think again, signed two closed. that things timeline think for be to back. And a transactions business. will do some equation and lighter-touch under costly that's the And so will that terms I shelf And an the regulator over put of And has M&A in I on It's really changed. risk-reward the years. impact come the

Brendan O'Brien

And my recruiting. for I touch just want to follow-up, on

of environment couple undergo of last I the initiative in over target conscious I a recruiting to understand was your last choice below part thinking you're years. the sense today about to seeing as get the bit from a recruiting want running to how expense what should and we be growth here? but been You've that a partner year,

Andrew Bednar

we that of transition very and people we're a But when in execute little an company current 'XX a different and a busy initiate that firms then are bit have in I Yes, is uneven, think said below bit period. to seeing uneven It'll we vet targets. to went taking to it We little We're firm. lot out and finally that, then and we're seeing a we're be longer to as at of candidates, running trend. partly opportunities. good some June their so public our a back and

market happened And earlier we I antitrust see that just a like much because out of it's in in taking similar there. so talent longer. But the where pipeline activity, the issue the closing are candidates to M&A what's alluded just

I population still advisory think of that's an to the segments there, very that's ours I proposition like a think exciting platform opportunity and to out compelling and a for very, move certain offers is market. dynamic the

'XX. time. established we are agree not So and see, But talent side in lighter take get winner opportunities do. markets on all we're and up that with constantly bit and agree markets all, we you. it's acquisition that pace with the new talent coming little a picking type up of you labor but it we're today we I a the for for changing, But that the up business. picking 'XX, here The

Operator

next our Hall Aidan with question we'll And KBW. take from

Aidan Hall

are you space, still you just the of broadening really spots? just of give you of services in Like then of you recruiting some on needs from kind had Perella's Maybe about and put of white couple a out also talked priority out if you start the see suite will? it finer following-up Can a some biggest on to where point building to you if of focused kind or areas kind where of environment. for capabilities there, touch the on

Andrew Bednar

term, would Yes, all I in it's expanding the footprint. to intermediate about say near our client

so groups, an have amount within And key space. industry just enormous we of our uncovered

team We more we fantastic thanks to into boardrooms have the all members last enough just don't brand the in brand have and of more into get the C-suites. a hard XX work years, and out team the to

out of getting less a to the United and capabilities, but it's got of And it's or very, we're well expanding footprint. we've There the client still very on coverage. we're our of how as and team bankers comfortable would a product continue service So line just lot areas our our I so client in client two built here additions some matter in more to markets. States Europe, probably be our there, uncovered build with we've as coverage going Bankers, key capabilities. now out may say,

Aidan Hall

way we of below XXXX to year, kind start the in ratio comp about the multi-year above the it has has comp leverage strong talking consideration be the the just rebound and ratio? to Obviously, tiers How into and been to system right relates with maybe and your that Maybe prepared for been trend. the growth about activity. in recruiting growth now taking as the and be should framing thinking just remarks,

Andrew Bednar

the XXXX, public again, today's X into results in a be mid-XXs. than points results is group estimate of last ratio said faster part we're year. growing the the and and in comp When company we we heading group, That's below for peer are We've said evidenced the peer from best accrual. we out as by Look, the the is back year-to-date we'd down particular. the as XX year. our in went It today very

as not pinpoint think for we calls, don't from prior the a a we're take historically, I've consistent we're ramp-up than it talent what with that building that the talent far in acquisition people do prior to on so acceleration to building in comp solving joining our experienced quarter-to-quarter, target. We're well, of ramp-up and hopefully a but business, I've closer off I We're comments in my result we as about as hopefully, think try that, reassessing and years mentioned M&A, world-class two getting firm and last said have years. and going environment to in revenue because, a investment number but the I market we've term, is in as near longer calls a ratio, new earlier multivariable partly we're business. to We're equation. is the decisions hopeful seen investment. Partially, also, for solving also on or not from the declines world-class that we've certainly

taking It's joined that's also bit just a about talk talent just to platform talent So, promotion, prior to acquisition. get it's up and peak when that's we investment, it's new performance. current-year the the not partner longer

of and the own firm As partners a this also, lot of stock. I've Aiden, said employees

the are right count, at the about shareholders, our over of alignment. what And is something We're group and approach. all to ratio things of very shareholders. on And ratio, I return think you'd growth very and what's at very we've shareholders. that with making in comp We We the comp balance aligned very now. list think we're to a deliver largest struck capital, carefully carefully look investment balanced shareholder much we the share that want good XX% between

Operator

question next Goldman Sachs. comes from with Yaro Our James

James Yaro

I some days, already Maybe all? M&A if the earlier. ones know little all? which Just mentioned speak think much a potential under And these has be the in two quick impact could activity yield a I key past your we the at on Andrew, at of the this then think questions happened tariffs. impact business, steeper if incoming I impacts. of one see of just to curve, does you is few administration what could on you bit election-related this

Andrew Bednar

of I may this. a little Sure. a be bit on minority

it's than going is bit was less our going several will rate ago. years a than used I but hope. we be And of the think all slower I probably think environment be accommodative to do I come certainly that market what think sponsors would maybe part back, to to

gone has an So view changed. pressures. decreasing lot the rate there own a continued are my increasing We've picture inflationary from certainly to cycle now cycle. is But that a of

And rates. base more spend a to that's have actually borrow You're to going more. down bring that's think government make challenging and very, going to it very I to going

not tailwind on expansion And EBITDA exits. they're going valuation pressure so through the to grinding costs. sponsors are to have think order through some drive going to And to going value drive and that to find put I financing just it's of in get

it's a So in as not continue I the think, as the of think terrible a corporate just story. M&A not still It's good backdrop, do I markets. world, will driving I which see

James Yaro

a near-term revenue just question. Maybe

revenues noted XQ in $XXX think to expect I that think million 'XX be I closer to you the put XQ 'XX. up you the

that was sequentially. will the Maybe this of revenue and separately think pull perhaps ahead be just revenue any whether quarter, sort could uncertainty down is of there speak you sequentially. to forward that impacting suggests election the was I there whether into

Andrew Bednar

just completely to engagement in saw not of little cessation all and a was a bit month tremendous there of so, slowdown activity. where election the we Yes, a activity industry a the lead-up in but or for a

brief was as bump our the I in the haven't were an good it choppiness is that QX two slowdown. we QX minor QX unevenness got and the on you've million, do overall doesn't of so year-end more in but that in. time, accelerants overall us. in some forward and a very I XXXX. Transactions on feel the So good growth, pull think there the fourth first along very very, that about now, strength period closed pulled It $XX make a sort I the of seen has will forward It's so some we but said speed up And little period. I how election. significant of days way we think the as trajectory earlier, the impact bit that did will it's for than quarter in with to We and over our a QX. policies. like bother a see accounting earlier that based on comments, we're more that we're on business going into looking strength be mentioned And secular 'XX,

James Yaro

Just quick here. one a really

should think and I have stock that's release XX other fourth you we in about read units. Class end-of-period of the share of noted going for XX.X count Any press XX.X share the that partnership and count, point that starting the million to we you have million mean of forward? around be million common A thinking that you nuances quarter? Should that the

Andrew Bednar

a Yes, that's read. address directly. I'll to Alex Actually, good that defer question, to James,

Alexandra Gottschalk

correct. was The period count the XX.X share ending Yes, the for million. so that's

Operator

This the turn remarks. now would Q&A call back I any like call. to [Operator additional Andrew portion Instructions]. of for closing today's the concludes over Bednar or to

Andrew Bednar

'XX, you We Thank and you, connecting strategic wish at thank the team wonderful on us to you, also plan here forward you from thank support look successful our end forward you, today. clients our our a the to and our speak to of to season, with on hope Perella again We and call. appreciate joining further holiday we you, and our executing operator, from investors, entire you. and with have opportunity with Okay, for all we February everyone, focus Weinberg. a look intense

Operator

Perella the Call Earnings Webcast. Quarter Weinberg XXXX Partners concludes This Third and

line a your at have time, and disconnect wonderful day. may this You

Perella Weinberg Partners (PWP) 8 Nov 242024 Q3 Earnings call transcript