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Exhibit 99.1

 

GRAPHIC

 

Moelis & Company Reports Fourth Quarter and Full Year 2015 Financial Results;

Special Dividend of $0.80 Per Share in Addition to
Regular Quarterly Dividend of $0.30 Per Share

 

Record Fourth Quarter and Full Year Revenues

 

·                  Fourth quarter 2015 revenues of $174.8 million, up 21% over the fourth quarter of 2014 driven by increased M&A completions and a more active restructuring environment

 

·                  Fourth quarter 2015 Adjusted Pro Forma net income of $0.55 per share (diluted) and GAAP net income of $0.50 per share (diluted)

 

·                  Fiscal year 2015 revenues of $551.9 million, up 6% over fiscal year 2014

 

·                  Adjusted Pro Forma net income of $1.66 per share (diluted) and GAAP net income of $1.58 per share (diluted) for fiscal year 2015

 

·                  Continued to execute on growth strategy

 

·                  Added 81 bankers, including 11 Managing Directors, on a net basis in 2015; ended the year with 462 bankers, including 105 Managing Directors

 

·                  Promoted three advisory professionals to Managing Director in early 2016

 

·                  Strong cash flow generation and capital returns

 

·                  Ended fiscal year 2015 with cash and short term investments of $286.0 million and no debt or goodwill

 

·                  Declared special dividend of $0.80 per share in addition to regular quarterly dividend of $0.30 per share

 

·                  Including today’s dividend announcement, returned $1.90 per share to investors through regular and special dividends with respect to the 2015 performance year

 

NEW YORK, February 9, 2016 — Moelis & Company (“we” or the “Firm”) (NYSE: MC) today reported financial results for the fourth quarter and fiscal year ended December 31, 2015.  The Firm’s fourth quarter 2015 revenues of $174.8 million increased 21% over the same period in the prior year and represented our largest quarter of revenues since inception.  Adjusted Pro Forma net income was $30.7 million or $0.55 per share (diluted) for the fourth quarter of 2015, compared with $28.4 million of Adjusted Pro Forma net income or $0.51 per share (diluted) for the fourth quarter of 2014.

 

1



 

The Firm’s fiscal year ended 2015 revenues of $551.9 million represented an increase of 6% over fiscal year 2014 and its largest annual revenues on record. Adjusted Pro Forma net income for fiscal year 2015 was $91.9 million or $1.66 per share (diluted), as compared with $94.4 million or $1.72 per share (diluted) for the same period in the prior year.

 

On a GAAP basis, the Firm reported net income of $41.1 million or $0.50 per share (diluted) for the fourth quarter of 2015 and $122.6 million or $1.58 per share (diluted) for the full year.  This compares to GAAP net income of $38.3 million or $0.52 per share (diluted) for the fourth quarter of 2014 and GAAP net income of $32.6 million and a net loss of $0.19 per share (diluted) for the period from the IPO closing on April 22, 2014 through December 31, 2014.

 

“Our record fourth quarter and full year revenues reflect the growth in our M&A related activity during the second half of the year and an active restructuring business.  Our activity was well distributed across sectors and geographies which demonstrates the diversity of our franchise,” said Ken Moelis, Chairman and Chief Executive Officer.

 

“Consistent with our capital-light model and focus on financial discipline, we generated significant free cash flow during the year.  We are returning this capital to our shareholders with today’s announcement of an $0.80 per share special dividend in addition to our regular quarterly dividend of $0.30 per share.  This will be our second special dividend since our IPO.”

 

“We also continue to invest in the Firm by recruiting and developing talent.  We stand uniquely positioned with our ‘One-Firm’ model that encourages collaboration and allows us to integrate our advisory expertise to provide creative solutions to clients in both M&A and restructuring cycles and periods of market uncertainty.”

 

The Firm’s revenues and net income can fluctuate materially depending on the number, size and timing of completed transactions on which it advised as well as other factors.  Accordingly, financial results in any particular quarter may not be representative of future results over a longer period of time.

 

Moelis & Company completed its IPO on April 22, 2014 and introduced a new corporate structure.   Currently 37% of the operating partnership (Moelis & Company Group LP) is owned by the corporation (Moelis & Company) and is subject to corporate U.S. federal and state income tax.  The remaining 63% is owned by other partners of Moelis & Company Group LP and is primarily subject to tax at the partner level (except for certain state and local and foreign income taxes).  The Adjusted Pro Forma results included herein remove the impact of adjustments to the Company’s Tax Receievable Agreement and compensation expenses specifically related to the Firm’s IPO awards, and apply the corporate tax rate to all earnings under the assumption that all outstanding Class A partnership units of Moelis & Company Group LP have been exchanged into Class A common stock of Moelis & Company. We believe the Adjusted Pro Forma results, when presented together with comparable GAAP results, are useful to investors to compare our performance across periods and to better understand our operating results.  A reconciliation between our GAAP results and our Adjusted Pro Forma results is presented in the Appendix to this press release.

 

2



 

GAAP and Adjusted Pro Forma Selected Financial Data (Unaudited)

 

 

 

U.S. GAAP

 

Adjusted Pro Forma*

 

 

 

Three Months Ended December 31,

 

($ in thousands except per share data)

 

2015

 

2014

 

2015 vs.

 2014

Variance

 

2015

 

2014

 

2015 vs.

 2014

Variance

 

Revenues

 

$

174,789

 

$

143,895

 

21

%

$

174,789

 

$

143,895

 

21

%

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

99,891

 

76,426

 

31

%

95,982

 

74,959

 

28

%

Non-compensation expenses

 

28,657

 

22,126

 

30

%

28,657

 

22,126

 

30

%

Total operating expenses

 

128,548

 

98,552

 

30

%

124,639

 

97,085

 

28

%

Operating income (loss)

 

46,241

 

45,343

 

2

%

50,150

 

46,810

 

7

%

Other income (expenses)

 

2,559

 

114

 

N/M

 

103

 

114

 

-10

%

Income (loss) from equity method investments

 

966

 

781

 

24

%

966

 

781

 

24

%

Income (loss) before income taxes

 

49,766

 

46,238

 

8

%

51,219

 

47,705

 

7

%

Provision for income taxes

 

8,622

 

7,950

 

8

%

20,488

 

19,320

 

6

%

Net income (loss)

 

41,144

 

38,288

 

7

%

30,731

 

28,385

 

8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) attributable to noncontrolling interests

 

29,959

 

28,790

 

4

%

 

 

N/M

 

Net income (loss) attributable to Moelis & Company

 

$

11,185

 

$

9,498

 

18

%

$

30,731

 

$

28,385

 

8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings per share

 

$

0.50

 

$

0.52

 

-4

%

$

0.55

 

$

0.51

 

8

%

 


N/M = not meaningful

* See Appendix for a reconciliation of GAAP to Adjusted Pro Forma

 

 

 

U.S. GAAP

 

Adjusted Pro Forma*

 

 

 

Twelve Months Ended December 31,

 

($ in thousands except per share data)

 

2015

 

2014

 

2015 vs.

 2014 

Variance

 

2015

 

2014

 

2015 vs. 

2014 

Variance

 

Revenues

 

$

551,863

 

$

518,750

 

6

%

$

551,863

 

$

518,750

 

6

%

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

311,224

 

377,219

 

-17

%

302,997

 

270,979

 

12

%

Non-compensation expenses

 

100,336

 

93,787

 

7

%

100,336

 

90,089

 

11

%

Total operating expenses

 

411,560

 

471,006

 

-13

%

403,333

 

361,068

 

12

%

Operating income (loss)

 

140,303

 

47,744

 

N/M

 

148,530

 

157,682

 

-6

%

Other income (expenses)

 

2,085

 

736

 

N/M

 

134

 

736

 

-82

%

Income (loss) from equity method investments

 

4,476

 

(2,185

)

N/M

 

4,476

 

273

 

N/M

 

Income (loss) before income taxes

 

146,864

 

46,295

 

N/M

 

153,140

 

158,691

 

-3

%

Provision for income taxes

 

24,274

 

13,740

 

77

%

61,256

 

64,270

 

-5

%

Net income (loss)

 

122,590

 

32,555

 

N/M

 

91,884

 

94,421

 

-3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) attributable to noncontrolling interests

 

88,848

 

35,567

 

N/M

 

 

 

N/M

 

Net income (loss) attributable to Moelis & Company

 

$

33,742

 

$

(3,012

)

N/M

 

$

91,884

 

$

94,421

 

-3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings per share

 

$

1.58

 

$

(0.19

)

N/M

 

$

1.66

 

$

1.72

 

-3

%

 


N/M = not meaningful

* See Appendix for a reconciliation of GAAP to Adjusted Pro Forma

 

3



 

Revenues

 

We earned record revenues of $174.8 million in the fourth quarter of 2015, as compared with $143.9 million in the fourth quarter of 2014, representing an increase of 21%.  The increase in revenues during the quarter resulted from an increase in average fees given the continued improvement in M&A and a more active restructuring environment.

 

For the year ended December 31, 2015, revenues were $551.9 million, as compared with $518.8 million in 2014, or an increase of 6%.  This represents our largest year of revenues on record and compares favorably with a 5% decrease in the number of global completed M&A transactions in the same period.(1)  The number of clients who paid fees equal to or greater than $1 million increased to 139 clients in 2015 from 130 clients in the same period of the prior year.

 

In early 2016, we promoted three of our advisory professionals to Managing Director: Erick Alberti (Brazil/Technology, Media and Telecommunications), Azad Badakhsh (US/Aerospace & Defense) and Apurva Mazumder (India/Regional Coverage).

 


(1)  Source: Thomson Financial as of January 8, 2016; includes all transactions greater than $100 million in value

 

4



 

Expenses

 

The following tables set forth information relating to the Firm’s operating expenses, which are reported net of client expense reimbursements.

 

 

 

U.S. GAAP

 

Adjusted Pro Forma*

 

 

 

Three Months Ended December 31,

 

($ in thousands)

 

2015

 

2014

 

2015 vs. 

2014 

Variance

 

2015

 

2014

 

2015 vs. 

2014 

Variance

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

$

99,891

 

$

76,426

 

31

%

$

95,982

 

$

74,959

 

28

%

% of revenues

 

57

%

53

%

 

 

55

%

52

%

 

 

Non-compensation expenses

 

$

28,657

 

$

22,126

 

30

%

$

28,657

 

$

22,126

 

30

%

% of revenues

 

16

%

15

%

 

 

16

%

15

%

 

 

Total operating expenses

 

$

128,548

 

$

98,552

 

30

%

$

124,639

 

$

97,085

 

28

%

% of revenues

 

74

%

68

%

 

 

71

%

67

%

 

 

 


N/M = not meaningful

* See Appendix for a reconciliation of GAAP to Adjusted Pro Forma

 

 

 

U.S. GAAP

 

Adjusted Pro Forma*

 

 

 

Twleve Months Ended December 31,

 

($ in thousands)

 

2015

 

2014

 

2015 vs. 

2014 

Variance

 

2015

 

2014

 

2015 vs. 

2014 

Variance

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

$

311,224

 

$

377,219

 

-17

%

$

302,997

 

$

270,979

 

12

%

% of revenues

 

56

%

73

%

 

 

55

%

52

%

 

 

Non-compensation expenses

 

$

100,336

 

$

93,787

 

7

%

$

100,336

 

$

90,089

 

11

%

% of revenues

 

18

%

18

%

 

 

18

%

17

%

 

 

Total operating expenses

 

$

411,560

 

$

471,006

 

-13

%

$

403,333

 

$

361,068

 

12

%

% of revenues

 

75

%

91

%

 

 

73

%

70

%

 

 

 


N/M = not meaningful

* See Appendix for a reconciliation of GAAP to Adjusted Pro Forma

 

Total operating expenses on an Adjusted Pro Forma basis were $124.6 million for the fourth quarter of 2015 as compared with $97.1 million for the fourth quarter of 2014.  For the fiscal year ended 2015, Adjusted Pro Forma operating expenses were $403.3 million as compared with $361.1 million in the same period of the prior year.  The increase in operating expenses in 2015 is primarily attributable to an increase in headcount with the addition of 81 advisory professionals during the year. This headcount growth is reflected in larger compensation and benefits expenses and non-compensation expenses.

 

For the fourth quarter of 2015, compensation and benefits expenses on an Adjusted Pro Forma basis were $96.0 million, or 55% of revenues, which compares with $75.0 million, or 52% of revenues in the fourth quarter of 2014.  Fiscal year ended December 31, 2015 compensation and

 

5



 

benefits expenses on an Adjusted Pro Forma basis were $303.0 million, or 55% of revenues, which compares with $271.0 million and 52% of revenues in fiscal year 2014.  The increased compensation ratio is attributable to the additional tranche of equity awarded in early 2015 and the increase in headcount combined with modest revenue growth.

 

Adjusted Pro Forma non-compensation expenses were $28.7 million for the fourth quarter of 2015, or 16% of revenues, as compared with $22.1 million, or 15% of revenues for the same period of the prior year.  The increase in the non-compensation expense ratio was primarily driven by increases in headcount and the timing of our annual client event, which was held during the fourth quarter of 2015 versus the third quarter of the prior year.  Adjusted Pro Forma non-compensation expenses were $100.3 million in fiscal year 2015, as compared with $90.1 million in fiscal year 2014.  Our 2015 Adjusted Pro Forma non-compensation expense ratio increased to 18% from 17% in fiscal year 2014, primarily driven by increases in headcount.

 

Provision for Income Taxes

 

Prior to our IPO, the Firm was not subject to federal income taxes, but was primarily subject to New York City unincorporated business tax and certain foreign income taxes.  As a result of completing our IPO in April 2014, we have a new corporate structure and currently 37% of the operating partnership (Moelis & Company Group LP) is owned by the corporation (Moelis & Company) and is subject to corporate U.S. federal and state income tax.  Income tax on the remaining 63% continues to be subject to New York City unincorporated business tax and certain foreign income taxes and is accounted for at the partner level through the non-controlling interests line item.  For Adjusted Pro Forma purposes, we have assumed all outstanding Class A partnership units of Moelis & Company Group LP have been exchanged into Class A common stock of Moelis & Company such that 100% of the Firm’s fourth quarter and full year 2015 income was taxed at our current corporate effective tax rate of 40.0%, versus a corporate effective tax rate of 40.5% for the fourth quarter and full year of 2014.

 

Capital Management and Balance Sheet

 

Moelis & Company continues to maintain a strong financial position and as of December 31, 2015, we held cash and short term investments of $286.0 million and had no debt or goodwill on our balance sheet.

 

On February 8, 2016, the Board of Directors of Moelis & Company declared a special dividend of $0.80 per share in addition to a regular quarterly dividend of $0.30 per share.  The $1.10 per share will be paid on March 4, 2016 to common stockholders of record on February 19, 2016.

 

Including the dividend announced today, we will have returned $1.90 per share to investors through regular and special dividends with respect to the 2015 performance year, further demonstrating our strong cash flow generation and commitment to returning 100% of our excess capital to shareholders.

 

6



 

Earnings Call

 

We will host a conference call beginning at 5:00pm ET on Tuesday, February 9, 2016, accessible via telephone and the internet.  Ken Moelis, Chairman and Chief Executive Officer, and Joe Simon, Chief Financial Officer, will review our fourth quarter and full year 2015 financial results. Following the review, there will be a question and answer session.

 

Investors and analysts may participate in the live conference call by dialing 1-877-510-3938 (domestic) or 1-412-902-4137 (international) and referencing the Moelis & Company Fourth Quarter 2015 Earnings Call.  Please dial in 15 minutes before the conference call begins. The conference call will also be accessible as a listen-only audio webcast through the Investor Relations section of the Moelis & Company website at www.moelis.com.

 

For those unable to listen to the live broadcast, a replay of the call will be available for one month via telephone starting approximately one hour after the live call ends. The replay can be accessed at 1-877-344-7529 (domestic) or 1-412-317-0088 (international); the conference number is 10078750.

 

About Moelis & Company

 

Moelis & Company is a leading global independent investment bank that provides innovative strategic advice and solutions to a diverse client base, including corporations, governments and financial sponsors.  The Firm assists its clients in achieving their strategic goals by offering comprehensive integrated financial advisory services across all major industry sectors.  Moelis & Company’s experienced professionals advise clients on their most critical decisions, including mergers and acquisitions, recapitalizations and restructurings and other corporate finance matters.  The Firm serves its clients with over 650 employees based in 17 offices in North and South America, Europe, the Middle East, Asia and Australia.  For further information about Moelis & Company, please visit www.moelis.com.

 

Forward-Looking Statements

 

This press release contains forward-looking statements, which reflect the Firm’s current views with respect to, among other things, its operations and financial performance. You can identify these forward-looking statements by the use of words such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “seeks,” “target,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or the negative version of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. For a further discussion of such factors, you should read the Firm’s filings with the Securities and Exchange Commission. The Firm undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.

 

7



 

Non-GAAP Financial Measures

 

Adjusted Pro Forma results are a non-GAAP measure which better reflect management’s view of operating results.  We believe that the disclosed Adjusted Pro Forma measures and any adjustments thereto, when presented in conjunction with comparable GAAP measures, are useful to investors to understand the Firm’s operating results by removing the significant accounting impact of one-time charges associated with the Firm’s IPO and assuming all Class A partnership units have been exchanged into Class A common stock.  These measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. A reconciliation of GAAP results to Adjusted Pro Forma results is presented in the Appendix.

 

Contacts

 

Investor Contact:

 

Media Contact:

Michele Miyakawa

 

Andrea Hurst

Moelis & Company

 

Moelis & Company

t: + 1 310 443 2344

 

t: + 1 212 883 3666

michele.miyakawa@moelis.com

 

m: +1 347 583 9705

 

 

andrea.hurst@moelis.com

 

8



 

Appendix

 

GAAP Consolidated and Combined Statement of Operations (Unaudited)

 

GAAP Reconciliation to Adjusted Pro Forma Financial Information (Unaudited)

 



 

Moelis & Company

GAAP Consolidated and Combined Statement of Operations

Unaudited

(dollars in thousands, except for share and per share data)

 

 

 

Three Months Ended
December 31,

 

Twelve Months Ended
December 31,

 

 

 

2015

 

2014

 

2015

 

2014

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

$

174,789

 

$

143,895

 

$

551,863

 

$

518,750

 

 

 

 

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

99,891

 

76,426

 

311,224

 

377,219

 

Occupancy

 

3,835

 

3,443

 

15,063

 

13,638

 

Professional fees

 

8,098

 

4,589

 

20,911

 

19,177

 

Communication, technology and information services

 

4,860

 

4,252

 

18,263

 

15,841

 

Travel and related expenses

 

7,634

 

5,905

 

24,329

 

25,338

 

Depreciation and amortization

 

681

 

632

 

2,635

 

2,268

 

Other expenses

 

3,549

 

3,305

 

19,135

 

17,525

 

Total expenses

 

128,548

 

98,552

 

411,560

 

471,006

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

46,241

 

45,343

 

140,303

 

47,744

 

Other income (expenses)

 

2,559

 

114

 

2,085

 

736

 

Income (loss) from equity method investments

 

966

 

781

 

4,476

 

(2,185

)

Income (loss) before income taxes

 

49,766

 

46,238

 

146,864

 

46,295

 

Provision for income taxes

 

8,622

 

7,950

 

24,274

 

13,740

 

Net income (loss)

 

41,144

 

38,288

 

122,590

 

32,555

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) attributable to noncontrolling interests

 

29,959

 

28,790

 

88,848

 

35,567

 

Net income (loss) attributable to Moelis & Company

 

$

11,185

 

$

9,498

 

$

33,742

 

$

(3,012

)

 

 

 

 

 

 

 

 

 

 

Weighted-average shares of Class A common stock outstanding

 

 

 

 

 

 

 

 

 

Basic

 

20,377,446

 

17,054,739

 

20,021,652

 

15,911,819

 

Diluted

 

22,201,408

 

18,155,870

 

21,362,571

 

15,911,819

 

Net income (loss) attributable to holders of shares of Class A common stock per share

 

 

 

 

 

 

 

 

 

Basic

 

$

0.55

 

$

0.56

 

$

1.69

 

$

(0.19

)

Diluted

 

$

0.50

 

$

0.52

 

$

1.58

 

$

(0.19

)

 

A-1



 

Moelis & Company

Reconciliation of GAAP to Adjusted Pro Forma Financial Information

Unaudited

(dollars in thousands, except share and per share data)

 

 

 

Three Months Ended December 31, 2015

 

 

 

GAAP

 

Pro-Forma
Adjustments

 

Adjusted Pro
Forma

 

Revenues

 

$

174,789

 

$

 

$

174,789

 

 

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

 

Compensation and benefits

 

99,891

 

(3,909

)(a)(b)

95,982

 

Non-compensation expenses

 

28,657

 

 

28,657

 

Total operating expenses

 

128,548

 

(3,909

)

124,639

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

46,241

 

3,909

 

50,150

 

Other income (expenses)

 

2,559

 

(2,456

)(b)

103

 

Income (loss) from equity method investments

 

966

 

 

966

 

Income (loss) before income taxes

 

49,766

 

1,453

 

51,219

 

Provision for income taxes

 

8,622

 

11,866

(c)

20,488

 

Net income (loss)

 

41,144

 

(10,413

)

30,731

 

 

 

 

 

 

 

 

 

Net income (loss) attributable to noncontrolling interests

 

29,959

 

(29,959

)

 

Net income (loss) attributable to Moelis & Company

 

$

11,185

 

$

19,546

 

$

30,731

 

 

 

 

 

 

 

 

 

Weighted-average shares of Class A common stock outstanding

 

 

 

 

 

 

 

Basic

 

20,377,446

 

33,762,802

(c)

54,140,248

 

Diluted

 

22,201,408

 

33,762,802

(c)

55,964,210

 

Net income (loss) attributable to holders of shares of Class A common stock per share

 

 

 

 

 

 

 

Basic

 

$

0.55

 

 

 

$

0.57

 

Diluted

 

$

0.50

 

 

 

$

0.55

 

 


(a)               Expense associated with the amortization of restricted stock units (“RSUs”) and stock options granted in connection with the IPO. In accordance with GAAP, amortization expense of RSUs and stock options granted in connection with the IPO will be recognized over the five year vesting period; we will continue to adjust for this expense due to the one-time nature of the grant.

 

(b)               Reflects a reclassification of other income associated with the forfeiture of fully vested Class A partnership units to compensation and benefits expense.

 

(c)                Assumes all outstanding Class A partnership units have been exchanged into Class A common stock. Accordingly, an adjustment has been made such that 100% of the Firm’s income is taxed at the corporate effective tax rate of 40.0% for the period presented.

 

A-2



 

 

 

Three Months Ended December 31, 2014

 

 

 

GAAP

 

Pro-Forma
Adjustments

 

Adjusted Pro
Forma

 

Revenues

 

$

143,895

 

$

 

$

143,895

 

 

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

 

Compensation and benefits

 

76,426

 

(1,467

)(a)

74,959

 

Non-compensation expenses

 

22,126

 

 

22,126

 

Total operating expenses

 

98,552

 

(1,467

)

97,085

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

45,343

 

1,467

 

46,810

 

Other income (expenses)

 

114

 

 

114

 

Income (loss) from equity method investments

 

781

 

 

781

 

Income (loss) before income taxes

 

46,238

 

1,467

 

47,705

 

Provision for income taxes

 

7,950

 

11,370

(b)

19,320

 

Net income (loss)

 

38,288

 

(9,903

)

28,385

 

 

 

 

 

 

 

 

 

Net income (loss) attributable to noncontrolling interests

 

28,790

 

(28,790

)

 

Net income (loss) attributable to Moelis & Company

 

$

9,498

 

$

18,887

 

$

28,385

 

 

 

 

 

 

 

 

 

Weighted-average shares of Class A common stock outstanding

 

 

 

 

 

 

 

Basic

 

17,054,739

 

37,196,115

(b)

54,250,854

 

Diluted

 

18,155,870

 

37,196,115

(b)

55,351,985

 

Net income (loss) attributable to holders of shares of Class A common stock per share

 

 

 

 

 

 

 

Basic

 

$

0.56

 

 

 

$

0.52

 

Diluted

 

$

0.52

 

 

 

$

0.51

 

 


(a)               Expense associated with the amortization of RSUs and stock options granted in connection with the IPO.

 

(b)               Assumes all outstanding Class A partnership units have been exchanged into Class A common stock. Accordingly, an adjustment has been made such that 100% of the Firm’s income is taxed at the corporate effective tax rate of 40.5% for the period presented.

 

A-3



 

 

 

Twelve Months Ended December 31, 2015

 

 

 

GAAP

 

Pro-Forma
Adjustments

 

Adjusted Pro
Forma

 

Revenues

 

$

551,863

 

$

 

$

551,863

 

 

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

 

Compensation and benefits

 

311,224

 

(8,227

)(a)(b)

302,997

 

Non-compensation expenses

 

100,336

 

 

100,336

 

Total operating expenses

 

411,560

 

(8,227

)

403,333

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

140,303

 

8,227

 

148,530

 

Other income (expenses)

 

2,085

 

(1,951

)(b)(c)

134

 

Income (loss) from equity method investments

 

4,476

 

 

4,476

 

Income (loss) before income taxes

 

146,864

 

6,276

 

153,140

 

Provision for income taxes

 

24,274

 

36,982

(c)(d)

61,256

 

Net income (loss)

 

122,590

 

(30,706

)

91,884

 

 

 

 

 

 

 

 

 

Net income (loss) attributable to noncontrolling interests

 

88,848

 

(88,848

)

 

Net income (loss) attributable to Moelis & Company

 

$

33,742

 

$

58,142

 

$

91,884

 

 

 

 

 

 

 

 

 

Weighted-average shares of Class A common stock outstanding

 

 

 

 

 

 

 

Basic

 

20,021,652

 

34,118,596

(d)

54,140,248

 

Diluted

 

21,362,571

 

34,118,596

(d)

55,481,167

 

Net income (loss) attributable to holders of shares of Class A common stock per share

 

 

 

 

 

 

 

Basic

 

$

1.69

 

 

 

$

1.70

 

Diluted

 

$

1.58

 

 

 

$

1.66

 

 


(a)               Expense associated with the amortization of RSUs and stock options granted in connection with the IPO. In accordance with GAAP, amortization expense of RSUs and stock options granted in connection with the IPO will be recognized over the five year vesting period; we will continue to adjust for this expense due to the one-time nature of the grant.

 

(b)               Reflects a reclassification of other income associated with the forfeiture of fully vested Class A partnership units to compensation and benefits expense.

 

(c)                Reflects the netting of GAAP adjustments made to the Company’s Tax Receivable Agreement against provision for income taxes.

 

(d)               Assumes all outstanding Class A partnership units have been exchanged into Class A common stock. Accordingly, an adjustment has been made such that 100% of the Firm’s income is taxed at the corporate effective tax rate of 40.0% for the period presented.

 

A-4



 

 

 

Twelve Months Ended December 31, 2014

 

 

 

GAAP

 

Pro-Forma
Adjustments

 

Adjusted Pro
Forma

 

Revenues

 

$

518,750

 

$

 

$

518,750

 

 

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

 

Compensation and benefits

 

377,219

 

(106,240

)(a)

270,979

 

Non-compensation expenses

 

93,787

 

(3,698

)(b)

90,089

 

Total operating expenses

 

471,006

 

(109,938

)

361,068

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

47,744

 

109,938

 

157,682

 

Other income (expenses)

 

736

 

 

736

 

Income (loss) from equity method investments

 

(2,185

)

2,458

(c)

273

 

Income (loss) before income taxes

 

46,295

 

112,396

 

158,691

 

Provision for income taxes

 

13,740

 

50,530

(d)

64,270

 

Net income (loss)

 

32,555

 

61,866

 

94,421

 

 

 

 

 

 

 

 

 

Net income (loss) attributable to noncontrolling interests

 

35,567

 

(35,567

)

 

Net income (loss) attributable to Moelis & Company

 

$

(3,012

)

$

97,433

 

$

94,421

 

 

 

 

 

 

 

 

 

Weighted-average shares of Class A common stock outstanding

 

 

 

 

 

 

 

Basic

 

15,911,819

 

38,339,035

(d)

54,250,854

 

Diluted

 

15,911,819

 

39,120,096

(d)

55,031,915

 

Net income (loss) attributable to holders of shares of Class A common stock per share

 

 

 

 

 

 

 

Basic

 

$

(0.19

)

 

 

$

1.74

 

Diluted

 

$

(0.19

)

 

 

$

1.72

 

 


(a)               Expense associated with the one time non-cash acceleration of Managing Director unvested equity accelerated upon completion of the IPO and amortization of RSUs and stock options granted in connection with the IPO.

 

(b)               Expense associated with the one-time non-cash acceleration of unvested equity held by non-employees of Moelis & Company.

 

(c)                Expense associated with the one-time non-cash acceleration of unvested equity held by employees of the Firm’s joint venture in Australia (the “Australian JV”).

 

(d)               Assumes all outstanding Class A partnership units have been exchanged into Class A common stock. Accordingly, an adjustment has been made such that 100% of the Firm’s income is taxed at the corporate effective tax rate of 40.5% for the period presented.

 

A-5