Houlihan Lokey Reports Fiscal Year and Fourth Quarter 2023 Financial Results

Fiscal Year 2023 Revenues of $1.81 billion

Fiscal Year 2023 Diluted EPS of $3.98

Adjusted Fiscal Year 2023 Diluted EPS of $4.54

Fourth Quarter Fiscal 2023 Revenues of $445 million

Fourth Quarter Fiscal 2023 Diluted EPS of $1.10

Adjusted Fourth Quarter Fiscal 2023 Diluted EPS of $1.11

Announces an Increase in the Quarterly Dividend to $0.55 per Share

Houlihan Lokey, Inc. (NYSE:HLI) (“Houlihan Lokey” or the “Company”) today reported financial results for its fiscal year and fourth quarter ended March 31, 2023. For the fiscal year, revenues declined (20)% to $1.81 billion, compared with $2.27 billion for the fiscal year ended March 31, 2022. For the fourth quarter ended March 31, 2023, revenues declined (6)% to $445 million, compared with $471 million for the fourth quarter ended March 31, 2022.

Net income was $269 million, or $3.98 per diluted share, for the fiscal year ended March 31, 2023, compared with $438 million, or $6.41 per diluted share, for the fiscal year ended March 31, 2022. Adjusted net income for the fiscal year ended March 31, 2023 was $315 million, or $4.54 per diluted share, compared with $485 million, or $7.10 per diluted share, for the fiscal year ended March 31, 2022.

Net income was $75 million, or $1.10 per diluted share, for the fourth quarter ended March 31, 2023, compared with $65 million, or $0.97 per diluted share, for the fourth quarter ended March 31, 2022. Adjusted net income for the fourth quarter ended March 31, 2023 was $77 million, or $1.11 per diluted share, compared with $88 million, or $1.30 per diluted share, for the fourth quarter ended March 31, 2022.

“As we look towards a new fiscal year, we believe that our diversified business model will continue to help us produce solid profitability under the current market environment. Our Corporate Finance business continues to see strong new business activity and some consistency in its quarterly results, notwithstanding the complexities in closing transactions in this market environment. Our Financial Restructuring business had a solid fourth quarter and is poised to deliver strong results in fiscal 2024, and our Financial and Valuation Advisory business modestly grew in fiscal 2023, maintaining its growth profile in a challenging M&A environment,” stated Scott Beiser, Chief Executive Officer of Houlihan Lokey.

Selected Financial Data

 

(In thousands, except per share data)

U.S. GAAP

Three Months Ended March 31,

 

Year Ended March 31,

2023

 

2022

 

2023

 

2022

Revenues by segment

 

 

 

 

 

 

 

Corporate Finance

$

256,425

 

 

$

279,019

 

$

1,127,126

 

$

1,593,083

 

Financial Restructuring

 

120,382

 

 

 

121,586

 

 

395,733

 

 

392,818

 

Financial and Valuation Advisory

 

67,960

 

 

 

70,561

 

 

286,588

 

 

284,057

 

Revenues

$

444,767

 

 

$

471,166

 

$

1,809,447

 

$

2,269,958

 

Operating expenses:

 

 

 

 

 

 

 

Employee compensation and benefits

$

282,937

 

 

$

293,580

 

$

1,147,879

 

$

1,408,634

 

Non-compensation expenses

 

71,206

 

 

 

78,977

 

 

319,830

 

 

248,460

 

Operating income

 

90,624

 

 

 

98,609

 

 

341,738

 

 

612,864

 

Other (income)/expense, net

 

(4,678

)

 

 

7,921

 

 

2,738

 

 

8,926

 

Income before provision for income taxes

 

95,302

 

 

 

90,688

 

 

339,000

 

 

603,938

 

Provision for income taxes

 

20,642

 

 

 

25,515

 

 

69,777

 

 

165,614

 

Net income

 

74,660

 

 

 

65,173

 

 

269,223

 

 

438,324

 

Net income attributable to noncontrolling interest

 

 

 

 

 

 

 

 

(573

)

Net income attributable to Houlihan Lokey, Inc.

$

74,660

 

 

$

65,173

 

$

269,223

 

$

437,751

 

 

 

 

 

 

 

 

 

Diluted earnings per share attributable to Houlihan Lokey, Inc.

$

1.10

 

 

$

0.97

 

$

3.98

 

$

6.41

 

Revenues

For the fiscal year ended March 31, 2023, revenues declined to $1.81 billion, compared with $2.27 billion for the fiscal year ended March 31, 2022. For the fiscal year ended March 31, 2023, CF revenues decreased (29)%, Financial Restructuring (“FR”) revenues increased 1%, and Financial and Valuation Advisory (“FVA”) revenues increased 1% when compared with the fiscal year ended March 31, 2022.

For the fourth quarter ended March 31, 2023, revenues declined to $445 million, compared with $471 million for the fourth quarter ended March 31, 2022. For the fourth quarter ended March 31, 2023, CF revenues decreased (8)%, FR revenues decreased (1)%, and FVA revenues decreased (4)% when compared with the fourth quarter ended March 31, 2022.

Expenses

The Company’s employee compensation and benefits expenses, non-compensation expenses, and provision for income taxes during the periods presented and described below are on a GAAP and an adjusted basis.

 

U.S. GAAP

 

Adjusted (Non-GAAP) *

 

Year Ended March 31,

($ in thousands)

2023

 

2022

 

2023

 

2022

Expenses:

 

 

 

 

 

 

 

Employee compensation and benefits

$

1,147,879

 

 

$

1,408,634

 

 

$

1,112,809

 

 

$

1,396,025

 

% of Revenues

 

63.4

%

 

 

62.1

%

 

 

61.5

%

 

 

61.5

%

Non-compensation

$

319,830

 

 

$

248,460

 

 

$

272,534

 

 

$

192,925

 

% of Revenues

 

17.7

%

 

 

10.9

%

 

 

15.1

%

 

 

8.5

%

Provision for Income Taxes

$

69,777

 

 

$

165,614

 

 

$

113,150

 

 

$

194,180

 

% of Pre-Tax Income

 

20.6

%

 

 

27.4

%

 

 

26.4

%

 

 

28.6

%

*

Adjusted figures represent non-GAAP information. See “Non-GAAP Financial Measures” and the tables at the end of this release for an explanation of the adjustments and reconciliations to the comparable GAAP numbers.

 

U.S. GAAP

 

Adjusted (Non-GAAP) *

 

Three Months Ended March 31,

($ in thousands)

2023

 

2022

 

2023

 

2022

Expenses:

 

 

 

 

 

 

 

Employee compensation and benefits

$

282,937

 

 

$

293,580

 

 

$

273,530

 

 

$

289,768

 

% of Revenues

 

63.6

%

 

 

62.3

%

 

 

61.5

%

 

 

61.5

%

Non-compensation

$

71,206

 

 

$

78,977

 

 

$

67,991

 

 

$

59,377

 

% of Revenues

 

16.0

%

 

 

16.8

%

 

 

15.3

%

 

 

12.6

%

Provision for Income Taxes

$

20,642

 

 

$

25,515

 

 

$

29,964

 

 

$

34,011

 

% of Pre-Tax Income

 

21.7

%

 

 

28.1

%

 

 

28.0

%

 

 

27.9

%

*

Adjusted figures represent non-GAAP information. See “Non-GAAP Financial Measures” and the tables at the end of this release for an explanation of the adjustments and reconciliations to the comparable GAAP numbers.

Year Ended March 31, 2023 Compared to the Year Ended March 31, 2022

Employee compensation and benefits expenses were $1.15 billion for the fiscal year ended March 31, 2023, compared with $1.41 billion for the fiscal year ended March 31, 2022. This resulted in a GAAP compensation ratio of 63.4% for the fiscal year ended March 31, 2023, compared with 62.1% for the fiscal year ended March 31, 2022. Adjusted employee compensation and benefits expenses were $1.11 billion for the fiscal year ended March 31, 2023, compared with $1.40 billion for the fiscal year ended March 31, 2022. This resulted in an adjusted compensation ratio of 61.5% for both the fiscal year ended March 31, 2023 and the fiscal year ended March 31, 2022. The decrease in GAAP and adjusted employee compensation and benefits expenses was primarily a result of a decline in revenues for the year when compared with the prior year.

Non-compensation expenses were $320 million for the fiscal year ended March 31, 2023, compared with $248 million for the fiscal year ended March 31, 2022. Adjusted non-compensation expenses were $273 million for the fiscal year ended March 31, 2023, compared with $193 million for the fiscal year ended March 31, 2022. The increase in GAAP and adjusted non-compensation expenses was primarily a result of an increase in travel, meals, and entertainment expenses as employees continued to return to travel and an increase in other operating expenses.

The provision for income taxes was $70 million, representing an effective tax rate of 20.6%, for the fiscal year ended March 31, 2023, compared with $166 million, representing an effective tax rate of 27.4%, for the fiscal year ended March 31, 2022. The decrease in the Company’s effective tax rate during the fiscal year ended March 31, 2023 relative to the fiscal year ended March 31, 2022 was primarily the result of increased stock compensation deductions, the release of the provision for an uncertain tax position as a result of the successful closure of a state audit and the release of a valuation allowance. The adjusted provision for income taxes was $113 million, representing an adjusted effective tax rate of 26.4%, for the fiscal year ended March 31, 2023, compared with $194 million, representing an adjusted effective tax rate of 28.6%, for the fiscal year ended March 31, 2022.

Quarter Ended March 31, 2023 Compared to the Quarter Ended March 31, 2022

Employee compensation and benefits expenses were $283 million for the fourth quarter ended March 31, 2023, compared with $294 million for the fourth quarter ended March 31, 2022. This resulted in a GAAP compensation ratio of 63.6% for the fourth quarter ended March 31, 2023, compared with 62.3% for the fourth quarter ended March 31, 2022. Adjusted employee compensation and benefits expenses were $274 million for the fourth quarter ended March 31, 2023, compared with $290 million for the fourth quarter ended March 31, 2022. This resulted in an adjusted compensation ratio of 61.5% for both the fourth quarter ended March 31, 2023 and the fourth quarter ended March 31, 2022. The decrease in GAAP and adjusted employee compensation and benefits expenses was primarily a result of a decline in revenues when compared with the same quarter last year.

Non-compensation expenses were $71 million for the fourth quarter ended March 31, 2023, compared with $79 million for the fourth quarter ended March 31, 2022. The decrease in GAAP non-compensation expenses was primarily a result of a decrease in amortization expense as the intangible assets recognized in connection with the acquisition of GCA became predominantly amortized, and a decrease in other operating expenses. Adjusted non-compensation expenses were $68 million for the quarter ended March 31, 2023, compared with $59 million for the fourth quarter ended March 31, 2022. The increase in adjusted non-compensation expenses was primarily a result of an increase in travel, meals, and entertainment expenses as employees continued to return to travel and an increase in rent expense, partially offset by a decrease in other operating expenses.

The provision for income taxes was $21 million, representing an effective tax rate of 21.7%, for the fourth quarter ended March 31, 2023, compared with $26 million, representing an effective tax rate of 28.1%, for the fourth quarter ended March 31, 2022. The decrease in the Company’s effective tax rate during the quarter ended March 31, 2023 relative to the quarter ended March 31, 2022 was primarily the result of the release of a valuation allowance. The adjusted provision for income taxes was $30 million, representing an adjusted effective tax rate of 28.0%, for the fourth quarter ended March 31, 2023, compared with $34 million, representing an adjusted effective tax rate of 27.9%, for the fourth quarter ended March 31, 2022.

Segment Reporting for the Fourth Quarter

Corporate Finance

CF revenues were $256 million for the fourth quarter ended March 31, 2023, compared with $279 million for the fourth quarter ended March 31, 2022. Revenues decreased primarily due to a decrease in the average transaction fee on closed transactions, which was driven by the size and timing of transactions that closed during the quarter, and does not represent a trend in the average fee on closed transactions.

 

Three Months Ended March 31,

 

Year Ended March 31,

($ in thousands)

2023

 

2022

 

2023

 

2022

Corporate Finance

 

 

 

 

 

 

 

Revenues

$

256,425

 

$

279,019

 

$

1,127,126

 

$

1,593,083

# of Managing Directors

 

217

 

 

202

 

 

217

 

 

202

# of Closed transactions (1)

 

140

 

 

144

 

 

503

 

 

600

Financial Restructuring

FR revenues were $120 million for the fourth quarter ended March 31, 2023, compared with $122 million for the fourth quarter ended March 31, 2022. Revenues remained relatively flat primarily due to a decrease in the average transaction fee on closed transactions, offset by an increase in the number of closed transactions. The decrease in the average transaction fee was driven by the size and timing of transactions that closed during the quarter, and does not represent a trend in the average fee on closed transactions. The increase in the number of closed transactions was driven by favorable market conditions for restructuring transactions.

 

Three Months Ended March 31,

 

Year Ended March 31,

($ in thousands)

2023

 

2022

 

2023

 

2022

Financial Restructuring

 

 

 

 

 

 

 

Revenues

$

120,382

 

$

121,586

 

$

395,733

 

$

392,818

# of Managing Directors

 

57

 

 

53

 

 

57

 

 

53

# of Closed transactions (1)

 

38

 

 

25

 

 

106

 

 

90

Financial and Valuation Advisory

FVA revenues were $68 million for the quarter ended March 31, 2023, compared with $71 million for the fourth quarter ended March 31, 2022. Revenues decreased primarily due to a decrease in the number of fee events. The decrease in the number of Fee Events was driven by softness in the M&A markets, which affected one or more of the service lines within our FVA business.

 

Three Months Ended March 31,

 

Year Ended March 31,

($ in thousands)

2023

 

2022

 

2023

 

2022

Financial and Valuation Advisory

 

 

 

 

 

 

 

Revenues

$

67,960

 

$

70,561

 

$

286,588

 

$

284,057

# of Managing Directors

 

39

 

 

34

 

 

39

 

 

34

# of Fee Events (1)

 

957

 

 

999

 

 

2,257

 

 

2,183

(1)

A Fee Event includes any engagement that involves revenue activity during the measurement period based on a revenue minimum of one thousand dollars. References in this press release to closed transactions should be understood to be the same as transactions that are “effectively closed” as described in our periodic reports on Forms 10-K and 10-Q.

Other Announcements

The Board of Directors of the Company declared a regular quarterly cash dividend of $0.55 per share of Class A and Class B common stock. The dividend will be payable on June 15, 2023 to stockholders of record as of the close of business on June 2, 2023.

Investor Conference Call and Webcast

The Company will host a conference call and live webcast at 5:00 p.m. Eastern Time on Tuesday, May 9, 2023, to discuss its full year and fourth quarter fiscal 2023 results. The number to call is 1-877-226-0954 (domestic) or 1-212-231-2901 (international). A live webcast will be available in the Investor Relations section of the Company’s website. A replay of the conference call will be available from May 9, 2023 through May 16, 2023, by dialing 1-844-512-2921 (domestic) or 1-412-317-6671 (international) and entering the passcode 151918000#. A replay of the webcast will be archived and available on the Company’s website.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the federal securities laws. You can identify these statements by our use of the words “assumes,” “believes,” “estimates,” “expects,” “guidance,” “intends,” “plans,” “projects,” and similar expressions that do not relate to historical matters. You should exercise caution in interpreting and relying on forward-looking statements because they involve known and unknown risks, uncertainties, and other factors which are, in some cases, beyond the Company’s control and could materially affect actual results, performance, or achievements. For a further description of such factors, you should read the Company’s filings with the Securities and Exchange Commission. Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, you should not rely on these forward-looking statements as predictions of future events. The events and circumstances reflected in our forward-looking statements may not be achieved or occur and actual results could differ materially from those projected in the forward-looking statements. The Company does not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.

Non-GAAP Financial Measures

Adjusted net income, total and on a per share basis, and certain adjusted items used to determine adjusted net income, are presented and discussed in this earnings press release and are non-GAAP measures that management believes, when presented together with comparable GAAP measures, are useful to investors in understanding the Company’s operating results. These adjusted items remove the significant accounting impact of one-time or non-recurring charges associated with the Company’s one-time/non-recurring matters, as set forth in the tables at the end of this release.

The adjusted items included in this earnings press release as calculated by the Company are not necessarily comparable to similarly titled measures reported by other companies. Additionally, these adjusted amounts are not a measurement of financial performance or liquidity under GAAP and should not be considered as an alternative to the Company’s financial information determined under GAAP. For a description of the Company’s use of these adjusted items and a reconciliation with comparable GAAP items, see the section of this press release titled “Reconciliation of GAAP to Adjusted Financial Information.” Please refer to our financial statements, prepared in accordance with GAAP, for purposes of evaluating our financial condition, results of operations, and cash flows.

About Houlihan Lokey

Houlihan Lokey (NYSE:HLI) is a global investment bank with expertise in mergers and acquisitions, capital markets, financial restructuring, and financial and valuation advisory. The firm serves corporations, institutions, and governments worldwide with offices in the Americas, Europe, the Middle East, and the Asia-Pacific region. Independent advice and intellectual rigor are hallmarks of the firm’s commitment to client success across its advisory services. Houlihan Lokey is the No. 1 investment bank for global M&A transactions under $1 billion, the No. 1 M&A advisor for the past eight consecutive years in the U.S., the No. 1 global restructuring advisor for the past nine consecutive years, and the No. 1 global M&A fairness opinion advisor over the past 25 years, all based on number of transactions and according to data provided by Refinitiv.

For more information, please visit www.HL.com.

Appendix

Condensed Consolidated Balance Sheets (Unaudited)

Condensed Consolidated Statements of Income (Unaudited)

Reconciliation of GAAP to Adjusted Financial Information (Unaudited)

HOULIHAN LOKEY, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

 

(In thousands, except share data and par value)

March 31, 2023

 

March 31, 2022

Assets

 

 

 

Cash and cash equivalents

$

714,439

 

 

$

833,697

 

Restricted cash

 

373

 

 

 

373

 

Investment securities

 

37,309

 

 

 

109,143

 

Accounts receivable, net of allowance for credit losses

 

182,029

 

 

 

144,029

 

Unbilled work in process, net of allowance for credit losses

 

115,045

 

 

 

104,751

 

Income taxes receivable

 

17,693

 

 

 

 

Deferred income taxes

 

104,941

 

 

 

95,278

 

Property and equipment, net

 

88,345

 

 

 

52,176

 

Operating lease right-of-use assets

 

333,877

 

 

 

171,942

 

Goodwill

 

1,087,784

 

 

 

1,070,442

 

Other intangible assets, net

 

203,370

 

 

 

247,333

 

Other assets

 

83,609

 

 

 

57,646

 

Total assets

$

2,968,814

 

 

$

2,886,810

 

 

 

 

 

Liabilities and Stockholders' Equity

 

 

 

Liabilities:

 

 

 

Accrued salaries and bonuses

$

765,877

 

 

$

953,604

 

Accounts payable and accrued expenses

 

113,421

 

 

 

126,190

 

Deferred income

 

40,695

 

 

 

28,753

 

Income taxes payable

 

 

 

 

61,266

 

Deferred income taxes

 

544

 

 

 

789

 

Loans payable to former shareholders

 

 

 

 

539

 

Operating lease liabilities

 

374,869

 

 

 

197,091

 

Other liabilities

 

45,111

 

 

 

74,873

 

Total liabilities

 

1,340,517

 

 

 

1,443,105

 

 

 

 

 

Stockholders' equity:

 

 

 

Class A common stock, $0.001 par value. Authorized 1,000,000,000 shares; issued and outstanding 50,638,924 and 49,853,564 shares, respectively

 

51

 

 

 

50

 

Class B common stock, $0.001 par value. Authorized 1,000,000,000 shares; issued and outstanding 18,048,345 and 17,649,555 shares, respectively

 

18

 

 

 

18

 

Additional paid-in capital

 

642,970

 

 

 

564,761

 

Retained earnings

 

1,048,072

 

 

 

922,223

 

Accumulated other comprehensive loss

 

(62,814

)

 

 

(43,347

)

Total stockholders’ equity

 

1,628,297

 

 

 

1,443,705

 

Total liabilities and stockholders’ equity

$

2,968,814

 

 

$

2,886,810

 

 

HOULIHAN LOKEY, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(UNAUDITED)

 

 

Three Months Ended March 31,

 

Year Ended March 31,

(In thousands, except share and per share data)

2023

 

2022

 

2023

 

2022

Revenues

$

444,767

 

 

$

471,166

 

$

1,809,447

 

$

2,269,958

 

Operating expenses:

 

 

 

 

 

 

 

Employee compensation and benefits

 

282,937

 

 

 

293,580

 

 

1,147,879

 

 

1,408,634

 

Travel, meals, and entertainment

 

13,391

 

 

 

5,001

 

 

51,082

 

 

22,465

 

Rent

 

17,911

 

 

 

14,120

 

 

55,838

 

 

47,747

 

Depreciation and amortization

 

6,347

 

 

 

19,948

 

 

58,221

 

 

48,537

 

Information technology and communications

 

15,201

 

 

 

13,497

 

 

54,125

 

 

41,714

 

Professional fees

 

9,078

 

 

 

10,361

 

 

32,940

 

 

38,349

 

Other operating expenses

 

9,278

 

 

 

16,050

 

 

67,624

 

 

49,648

 

Total operating expenses

 

354,143

 

 

 

372,557

 

 

1,467,709

 

 

1,657,094

 

Operating income

 

90,624

 

 

 

98,609

 

 

341,738

 

 

612,864

 

Other (income)/expense, net

 

(4,678

)

 

 

7,921

 

 

2,738

 

 

8,926

 

Income before provision for income taxes

 

95,302

 

 

 

90,688

 

 

339,000

 

 

603,938

 

Provision for income taxes

 

20,642

 

 

 

25,515

 

 

69,777

 

 

165,614

 

Net income

 

74,660

 

 

 

65,173

 

 

269,223

 

 

438,324

 

Net income attributable to noncontrolling interest

 

 

 

 

 

 

 

 

(573

)

Net income attributable to Houlihan Lokey, Inc.

$

74,660

 

 

$

65,173

 

$

269,223

 

$

437,751

 

 

 

 

 

 

 

 

 

Weighted average shares of common stock outstanding:

Basic

 

63,351,104

 

 

 

64,085,273

 

 

63,358,408

 

 

64,970,287

 

Fully diluted

 

68,107,465

 

 

 

67,461,779

 

 

67,586,263

 

 

68,259,708

 

Earnings per share attributable to Houlihan Lokey, Inc.

 

 

 

 

 

 

 

Basic

$

1.18

 

 

$

1.02

 

$

4.25

 

$

6.74

 

Fully diluted

$

1.10

 

 

$

0.97

 

$

3.98

 

$

6.41

 

 

HOULIHAN LOKEY, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO ADJUSTED FINANCIAL INFORMATION

(UNAUDITED)

 

 

Three Months Ended March 31,

 

Year Ended March 31,

(In thousands, except share and per share data)

2023

 

2022

 

2023

 

2022

Revenues

$

444,767

 

 

$

471,166

 

 

$

1,809,447

 

 

$

2,269,958

 

 

 

 

 

 

 

 

 

Employee compensation and benefits expenses

 

 

 

 

 

 

 

Employee compensation and benefits expenses (GAAP)

$

282,937

 

 

$

293,580

 

 

$

1,147,879

 

 

$

1,408,634

 

Less: Acquisition related retention payments

 

(9,407

)

 

 

(3,812

)

 

 

(35,070

)

 

 

(12,609

)

Employee compensation and benefits expenses (adjusted)

 

273,530

 

 

 

289,768

 

 

 

1,112,809

 

 

 

1,396,025

 

 

 

 

 

 

 

 

 

Non-compensation expenses

 

 

 

 

 

 

 

Non-compensation expenses (GAAP)

$

71,206

 

 

$

78,977

 

 

$

319,830

 

 

$

248,460

 

Less: Integration and acquisition related costs

 

 

 

 

(3,793

)

 

 

(2,325

)

 

 

(21,598

)

Less: Acquisition amortization

 

(3,215

)

 

 

(15,807

)

 

 

(44,971

)

 

 

(33,937

)

Non-compensation expenses (adjusted)

 

67,991

 

 

 

59,377

 

 

 

272,534

 

 

 

192,925

 

 

 

 

 

 

 

 

 

Operating income

 

 

 

 

 

 

 

Operating income (GAAP)

$

90,624

 

 

$

98,609

 

 

$

341,738

 

 

$

612,864

 

Plus: Adjustments (1)

 

12,622

 

 

 

23,412

 

 

 

82,366

 

 

 

68,144

 

Operating income (adjusted)

 

103,246

 

 

 

122,021

 

 

 

424,104

 

 

 

681,008

 

 

 

 

 

 

 

 

 

Other (income)/expense, net

 

 

 

 

 

 

 

Other (income)/expense, net (GAAP)

$

(4,678

)

 

$

7,921

 

 

$

2,738

 

 

$

8,926

 

Less: Warrant revaluation

 

 

 

 

 

 

 

(2,264

)

 

 

 

Less: SPAC wind-down write-off

 

 

 

 

 

 

 

(2,742

)

 

 

 

Plus/(less): Change in acquisition earnout liability fair value

 

738

 

 

 

(7,613

)

 

 

(2,103

)

 

 

(7,613

)

Other (income)/expense, net (adjusted)

 

(3,940

)

 

 

308

 

 

 

(4,371

)

 

 

1,313

 

 

 

 

 

 

 

 

 

Provision for income taxes

 

 

 

 

 

 

 

Provision for income taxes (GAAP)

$

20,642

 

 

$

25,515

 

 

$

69,777

 

 

$

165,614

 

Plus: Impact of the excess tax benefit for stock vesting

 

 

 

 

 

 

 

8,102

 

 

 

6,922

 

Plus: Release of the provision for an uncertain tax position as a result of the successful closure of a state audit

 

 

 

 

 

 

 

5,762

 

 

 

 

Plus: Release of valuation allowance

 

5,881

 

 

 

 

 

 

5,881

 

 

 

 

Adjusted provision for income taxes

 

26,523

 

 

 

25,515

 

 

 

89,522

 

 

 

172,536

 

Plus: Resulting tax impact (2)

 

3,441

 

 

 

8,496

 

 

 

23,628

 

 

 

21,644

 

Provision for income taxes (adjusted)

 

29,964

 

 

 

34,011

 

 

 

113,150

 

 

 

194,180

 

 

 

 

 

 

 

 

 

Net income

 

 

 

 

 

 

 

Net income (GAAP)

$

74,660

 

 

$

65,173

 

 

$

269,223

 

 

$

438,324

 

Plus: Adjustments (3)

 

2,562

 

 

 

22,529

 

 

 

46,102

 

 

 

47,191

 

Net income (adjusted)

 

77,222

 

 

 

87,702

 

 

 

315,325

 

 

 

485,515

 

Net income attributable to noncontrolling interest

 

 

 

 

 

 

 

 

 

 

(573

)

Net income attributable to Houlihan Lokey, Inc. (GAAP)

 

74,660

 

 

 

65,173

 

 

 

269,223

 

 

 

437,751

 

Net income attributable to Houlihan Lokey, Inc. (adjusted)

 

77,222

 

 

 

87,702

 

 

 

315,325

 

 

 

484,942

 

 

 

 

 

 

 

 

 

Fully diluted shares outstanding

 

 

 

 

 

 

 

Fully diluted shares outstanding (GAAP)

 

68,107,465

 

 

 

67,461,779

 

 

 

67,586,263

 

 

 

68,259,708

 

Plus: Impact of unvested GCA retention and deferred share awards

 

1,591,157

 

 

 

 

 

 

1,927,786

 

 

 

 

Fully diluted shares outstanding (adjusted)

 

69,698,622

 

 

 

67,461,779

 

 

 

69,514,049

 

 

 

68,259,708

 

 

 

 

 

 

 

 

 

Diluted EPS attributable to Houlihan Lokey, Inc. (GAAP)

$

1.10

 

 

$

0.97

 

 

$

3.98

 

 

$

6.41

 

Diluted EPS attributable to Houlihan Lokey, Inc. (adjusted)

$

1.11

 

 

$

1.30

 

 

$

4.54

 

 

$

7.10

 

(1)

The aggregate of adjustments from employee compensation and benefits and non-compensation expenses.

(2)

Reflects the tax impact of utilizing the adjusted effective tax rate on the non-tax adjustments identified above.

(3)

Consists of all adjustments identified above net of the associated tax impact.

 

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