Greenhill & Co Inc (GHL) 2017 Q3 法說會逐字稿

Good day, and welcome to the Greenhill Third Quarter Earnings Conference Call. (Operator Instructions) Please note this event is being recorded.

I would now like to turn the conference over to Patrick Suehnholz, Head of Investor Relations. Please go ahead.

Thank you. Good afternoon, and thank you all for joining us today for Greenhill's Third Quarter 2017 Financial Results Conference Call. I'm Patrick Suehnholz, Greenhill's Head of Investor Relations, and joining me on the call today is Scott Bok, our Chief Executive Officer.

Today's call may include forward-looking statements. These statements are based on our current expectations regarding future events that, by their nature, are outside of the firm's control and are subject to known and unknown risks, uncertainties and assumptions. The firm's actual results and financial condition may differ, possibly materially, from what is indicated in those forward-looking statements. For a discussion of some of the risks and factors that could affect the firm's future results, please see our filings with the Securities and Exchange Commission, including our annual report on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K.

Neither we nor any other person assumes responsibility for the accuracy or completeness of any of these forward-looking statements. You should not rely upon forward-looking statements as predictions of future events. We are under no duty to update any of these forward-looking statements after the date on which they are made.

I would now like to turn the call over to Scott Bok.

Thank you, Patrick. We reported third quarter revenue of $48.1 million and a loss of $0.18 per share. For the year-to-date, our revenue was $172.3 million, down 26% versus last year, and we had a loss of $0.01 per share as the reduced level of revenue resulted in higher-than-normal cost ratios and lower-than-usual earnings.

It's worth noting at the outset that while the nature of our business has always produced volatile quarterly results, we have a long history of generating strong revenue and cash flow, and we view the recent period as an aberration that is not at all indicative of the health of our business. In fact, our year-to-date financial results bely a number of positive data points.

Globally, our retainer fee income for the year-to-date is up versus last year, indicating a continued high level of engagement with clients. On a regional basis, our total revenue from U.S. clients is up by a double-digit percentage versus last year. And our primary capital advisory business has had a good year-to-date, while our secondary capital advisory business has had an outstanding year-to-date, with both those businesses performing particularly well in the third quarter and showing significantly higher revenue for the year-to-date.

The decline in our overall revenue numbers is less entirely a function of reduced corporate transaction activity outside the U.S. Over the course of our history, the diversity of our sources of revenue and cash flow has typically been such that in almost any period, weakness in some areas is offset by strength in others. But in the year-to-date, the areas of outperformance have not been sufficient to offset the areas of underperformance. Specifically, after a very strong performance in 2016, our revenue from European corporate clients has been particularly soft and revenue from corporate clients in other regions outside the U.S. has continued to be soft as well.

But notwithstanding these year-to-date results, our confidence in the strength of our European business remains high. We have a very long history of success in that market. We have an impressive client list with a good number of attractive current assignments, and we have the same senior team in place that produced very strong 2016 results in that region. In other markets outside the U.S., we have a similar level of confidence in our future performance based both on our history and our current book of assignments.

While our third quarter revenue outcome was consistent with what we signaled on our last call, in the current quarter and beyond, we continue to expect to see evidence of global transaction activity and total revenue returning to a level consistent with our historic performance.

Beyond revenue, our other financial metrics are largely a function of the scale of our revenue and the fact that our revenue has been very heavily weighted to the U.S. Our compensation costs are slightly lower than last year in absolute terms but obviously higher in ratio terms given the revenue outcome.

Our non-compensation costs year-to-date are similar to last year, though this quarter's result was negatively impacted by a noncash adjustment in the probability of the earn-out from our Cogent acquisition being achieved as well as from foreign exchange losses mostly related to the funding of our Brazil operation. As and when our global revenue returns to more typical levels, we expect our various costs and profit ratios to do likewise.

With respect to our balance sheet, we ended the quarter with $51 million in cash and $84 million outstanding on our revolving credit facility, with our bank term loan relating to the Cogent acquisition having been fully paid off.

However, the more important balance sheet news is that subsequent to quarter end, we completed the first element of the recapitalization and share repurchase plan we announced a few weeks ago. As noted in our press release, we completed the borrowing of $350 million under a Term Loan B structure. The key terms of that loan are summarized in our press release and detailed in recent SEC filings.

With that loan in place, our revolving credit facility with First Republic Bank has been fully paid off, and we have a current cash balance in excess of $300 million. And that figure is before the $20 million in primary common stock investments in the firm that Bob Greenhill and I will complete shortly.

Our press release also notes that we have a tender offer to purchase 12 million shares of our common stock that is currently pending. We've been advised that it is appropriate to let the regulatory filings with respect to that offer speak for themselves rather than provide any further commentary on this call.

Finally, given our plans for up to $285 million in share repurchases, we've reduced our quarterly dividend to $0.05 per share so that our cash flow going forward can be redirected to debt service. Once we have completed our planned share repurchase, we will have returned more than $1.5 million to shareholders via dividends and share repurchases since we went public in 2004, with an approximately $500 million market capitalization.

I will close with a brief comment on recruiting. This was a very good year for us in managing director recruiting with 9 hires completed and also a very good year in terms of retention of key people. Our recapitalization plan is obviously an exciting one for our team, which will have substantially increased collective economic ownership of the firm as well as leveraged upside potential going forward. It is also noteworthy that since we announced our recapitalization plan, we've seen increased interest in our firm from senior bankers of various competitors, so we are hopeful of another strong year recruiting in 2018.

With that, we're happy to take questions.

(Operator Instructions) Our first question comes from Devin Ryan of JMP Securities.

A question here just on the recapitalization deal and the structure. Can you give us any information around -- you just ended here talking about interest in the firm and also retention. How many, I guess, maybe senior bankers will be receiving shares or will be participating in the deal in any way? Just trying to think about the outside kind of the most senior level and some of the key people if there will be additional kind of incentives to keep people in their seats. And then also, just more broadly, the comp ratio outlook kind of longer term here and whether that there's maybe a structural shift a little bit higher just as we think about kind of the firm and margins.

Yes. In the first part of your question, I mean, look, I -- we've obviously not have a problem with retention. We've really lost pretty much nobody in a very long period of time. So the -- to be honest, the equity awards we made were really more to provide comfort to lenders. It was something that was appealing to them to have a clear alignment between our key people and the debt repayment. And so we put it in place, and obviously, that had a nice impact on that, hence, we were able to upsize the deal and so on. There weren't -- first of all, almost everybody is a participant in a sense that pretty much everybody has got equity in some form of either common shares or restricted stock or both that they have. There were a reasonable number of people who got incremental awards. But in some, those are not -- from a shareholder's point of view, those are not terribly material. I wouldn't worry about sort of dilution in any material sense at all. These were more, I would call, gestures, which we thought collectively might be attractive to the lender group. As far as the comp ratio going forward, I wouldn't really want to speculate necessarily on that. I mean, it's been within a certain range for a number of years. Obviously, it's a function of revenue largely, which is why this year's is -- at least year-to-date, is an outlier. So we'll see how the revenue plays out and how quickly we can move back toward the range we've historically been in.

Got it. Okay. Helpful. And then with respect to just the deal as well the -- obviously, the terms and the size in that the size was upsized, and so can you just talk a little bit about the disclosure for the lender group in terms of that process? Question that we've gotten is kind of what do they know, obviously, the deal was bigger so maybe people were willing to give you more money than kind of what you originally asked for.

I'm not sure what really to say about that. I mean, obviously, people do their due diligence. The nature of that market is the number of people work only with public information, and some others are different types of investors and work with private information. And -- but you know the nature of our business is such that if somebody asks us to forecast our revenue 4 quarters out, I mean, it doesn't matter whether you sign a confidentiality agreement or not, that's a hard thing to do other than just in a very, very directional sense. So I think creditors made their decisions, and rating agencies for that matter, based on a very long-term track record of us essentially generating about $100 million of pretax cash flow a year, of which around, call it, $30-something million went to pay taxes and $60-something million went to the dividend. And by redirecting that cash flow, I think people quickly got comfort. Again, rating agencies and lenders that -- they were very comfortable with the amount of debt we ended up with, and we were pleased to be able to upsize it through the process.

Got it. Okay. And then just last one around kind of the environment and what you guys are seeing. So expectations that we could see some evidence of the rebound in the fourth quarter and I guess into next year. Is that just an expectation that larger deals are improving? Or kind of what is driving that? Is it just really idiosyncratic with what you're seeing with your individual clients and just a sense that they are more engaged and closer to moving forward on a transaction?

I'm probably speaking more to our individual situation. I mean, if you -- clearly, if you look at the market data, you can see the volume is pretty flat year-over-year. Volume was pretty flat last year versus the prior year as well. You can also see that large deals, particularly sort of $5 billion or greater and even more so a $10 billion or greater, are down very materially. So clearly, there have been some kind of market headwinds for our business, both in terms of the fact that the domestic market, I think, still continues to be better than international and the larger deals are tending not to get to announcement at least in the recent months.

So I do think both of those factors will change. I think, over time, the M&A business is really a global one rather than a regional one, and you'll see activity broaden in the regional sense. And I think, certainly, you will see a rebound toward larger transactions in due course. And certainly, on top of those 2 things, I think for a variety of probably completely idiosyncratic and somewhat random reasons, we've not had that many M&A deals of size get to announcement this year. And certainly, our belief is that over the -- of any reasonable time frame, we'll return to a more normal sort of pace.

Got it. Okay. Maybe last quick one here just on recruiting. You mentioned that more people are, I guess, interested in the firm with this deal or you're getting some inquiries. It's a little late in the year probably for new recruiting, but any expectations or hopes kind of for next year and particular areas of focus you think about building from here?

I -- certainly, this year was a very good year for us. I'm hopeful next year is a similarly good year. I wouldn't necessarily predict lots more or many less than that. I think 9 is a lot, and I think we'll -- we should have a good year next year. There has been -- there were a number of conversations we already were in before. We announced our new plan, but it clearly has caught people's attention. I mean, clearly, some elements of the plans show some real belief and commitment to the business from people here. I think that's interesting. I think people like the leveraged upside. I think people like still being part of a public company but having bigger ownership internally. So collectively, those things seemed to sort of prompt a number of incoming calls in a more receptive audience -- and it already was quite receptive even before that. So I'm pretty excited about opportunities to continue to build the firm out in early next year.

Our next question comes from Ann Dai of KBW.

I wanted to follow back up on the question about the upsize term loan but from a different direction. I understand kind of being offered more from the debt markets and taking that, but I guess I'm wondering what the internal conversation was around what to do with that extra $50 million of cash. Why not keep some of it as liquidity buffer instead of putting all of it into buying back more shares?

Clearly, the board and management considered carefully before we started this whole process what level of debt we wanted, how much we wanted to ask for upfront versus seeing how the market evolved and responded and what terms we could get. Obviously, at the same time we upsized, we kind of brought down the expected interest rate and the expected P/E. And so it was an attractive recession in every way, not just upsizing. And look, our view going forward is that the business doesn't need -- have huge cash needs. I mean, what we spent a lot of money on over the years is the dividend. Once you've made a very substantial reduction in that, the quarterly cash needs are not that great. So clearly, we're going to be prudent about managing our balance sheet, but we feel we have the ability to do the full $285 million over time of share repurchases. A lot of it may be in the near term, and we'll -- that will still leave us plenty of flexibility going forward is our current view.

Okay. And also maybe just on comps, if we're thinking about comp for this year, just given that you're doing the big repurchase and given where the stock price is, do you anticipate any changes to how you think about the mix of cash versus stock comp?

Not necessarily. We've obviously not given much thought to that at all. Still our process tends to be, really, January more than October in terms of thinking about compensation. So I -- but I wouldn't expect anything dramatically different in terms of the way we think about comp structurally.

Okay. Last one for me. Can you just give us some sense of how much of the revenue generation this quarter was from the capital advisory business or restructuring as opposed to M&A?

It was -- I would say -- I mean, I don't want to break it down because we only do that once a year. Of course, we do, do it at year-end, and so you'll see it just a quarter from now. But it was not a great quarter in terms of M&A completion revenue. It was a very good quarter in the capital advisory business, both primary and even more so on the secondary side. And that's why we're -- that's why we do multiple different things. As I said, normally, the spots of weakness were more than made up for -- by areas of strength, and certainly, capital advisory was a particularly strong performer. And our outlook remains pretty positive for that business going forward as well. So we're very pleased with how that's going.

Our next question comes from Conor Fitzgerald of Goldman Sachs.

So just want to talk about the pace of debt pay down kind of in the scenario where you have a strong 2018. Should we think about maybe paying down sizeable amount of debt? Is it more along the pace of kind of what's in your covenants? And then on that vein -- and how should we -- just updated thoughts, be thinking about kind of minimum cash level as we think about the pace of pay downs.

Look, I think the -- one of the attractive elements of the kind of debt that we issued is that it's very, very flexible on repayment. And certainly, we'll make sure to keep a prudent amount of cash on the balance sheet. But beyond that, there's no real need to stockpile it. We're not going to focus on dividends for a while. We're not going to focus on share buyback beyond the very large amount we're talking about upfront. And we're not a big one for sort of cash acquisitions or capital expenditures or anything like that.

So our goal would be to pay the debt down as fast as we possibly can. And I think if we started off with a strong year, I think you'd certainly see us do that at a much faster rate than what's required by the loan documentation, which is meant to be sort of a bare minimum as opposed to a larger amount. And again, there's no penalty at all to repaying on a cash flow. So we've had every incentive to do it as quickly as possible, and obviously, the deleveraging is a big part of our equity story going forward. So we have yet another reason to do that.

Got it. And then on last quarter's call, I think you talked about some of the discussions that precede -- back all your announcements being strong. Can you just give us an update on how those discussions are tracking? And any sense of maybe when -- not to call out specific transactions, obviously, is there any sense of when some of the public indicators would start to reflect that strength?

I think -- I mean, if you're talking about the market generally, I think that's sort of anybody's guess. But I think we certainly are reasonably optimistic about the M&A activity continuing for the medium term domestically, and we're still optimistic medium term things continue or that things will finally get more active overseas. For us, it's -- I can't be too specific about it.

Clearly, we've got a very interesting list of assignments for many companies, many of which would be household-type names. And so while you can look at this quarter and say we didn't close much in terms of a number of transactions or scale of transactions and so on, that -- it's a different story if you look at things we're working on, and we'll keep working on those things and see how they come to fruition over time.

Okay. And then just a cleanup just on Devin's question. Could you just talk more broadly about the type of data you shared with debt lenders who signed non disclosures?

It's -- again, there's not really much to say there. It's -- frankly, it's very little. It's very, very, little as in, in number of pages remarkably little. Our business, there's -- one of the -- I guess one of the attractions of it in a way is that it really is remarkably simple. We have a very, very simple balance sheet. We don't spend money on capital expenditures. Our cost ratios have been within fairly narrow bounds. Over our history, it is a business that does not lend itself to making long-term projections that one would have a huge amount of confidence in.

So there's not a lot of secrets to disclose, frankly. We've got 21 years of history we could show, and I can say both rating agencies and the lenders seem to focus very much on that long-term history, where you earned your money, regional mix, sectoral mix, things like that. That kind of thing we disclose every year at year-end. We just -- we put a lot of stuff in sort of nice, neat format for them, but it's no different than what we disclose to equity investors over time. So the incremental amount that private lenders receive is really very, very modest.

Our next question comes from Michael Needham of Bank of America.

So I guess, first, I mean, as highlighted in the press release, like the amount of shares that are going to be owned by employees and that, like, interests are aligned and everything. Would these transactions -- I'm just trying to compare it like in a typical leverage buyout, the primary value creators making changes for the company to like grow cash flows. So just strategically, are you going to be doing something different going forward? Or do you view this as kind of a temporary lull when market comes back?

I would say a little bit of both of those. Good question, first of all, I think, and one that we -- certainly it's one we reflected on a lot. I think we do view the last period here as a temporary lull, and we think that things will sort of return to normal for us in due course. Having said that, we did not want this transaction that we're doing, even as -- that we're very, very excited about it, to be purely a bit of financial engineering. We think it sets the stage for a great opportunity for the people that work here and the outside shareholders who want to ride along with this firm as it goes forward from here.

But we certainly are looking at everything we do and thinking about how can we do it better, whether it's recruiting, whether it's compensating, whether it's cost of various types, whether it's how we go after clients, et cetera. So yes, we have every confidence that it's been a bit of a lull and activity will normally pick up. But we're kind of using the transaction as an excuse to just take another hard look at everything and see if we can do things even better because now we have even more incentives with the large employee ownership to squeeze as much value as we can and really benefit on the leverage upside from doing that.

Okay. Got it. And on -- I think you got a related question, which is a follow-up on the, I think, recruiting and compensating people. I guess why not hold some of this cash and just use that to grow the business or pay people more?

To the extent we need the cash to grow the business, we can do that. We -- we're not spending it all in one shot. As I've said, by eliminating a very large part of the historic dividend, it's obviously a larger percentage cut, there's going to be fewer shares to pay it on, we'll have dramatically better financial flexibility going forward. But on top of that, we've got -- the proceeds are sitting on our balance sheet right now. We will use them over time to buy back the shares in a way that we think gets the best value for the remaining shareholders. And so I -- we're mindful of the issue you referred to. But again, the key thing really is the reduction of the dividend, which just gives you so much more operating flexibility going forward.

Okay. Got it. And on the -- like the cash that you're going to have left after this, the tender offer, is that the -- I'm sure it depends on the price, but is it -- are you planning to kind of get the rest of that done quickly or like offset dilution over time? I guess, how do you think about that?

Look, I think we've made announcements in that regard, and the way the rules work, I am told we are not supposed to discuss further what our plans are. By the way, our specific plans are going to be driven by the opportunities that face us anyway. Obviously, we want to get for the money we've raised as many shares as we can. We want to do it in a prudent way, and we'll make decisions along the way as to how best to do that.

Our next question comes from Brennan Hawken (sic) [Brennan Mc Hawken] of UBS.

Scott, curious if you could maybe square something. You seem to refer to the restricted stock issued tied to this recap as a token, but then that it was a draw from potential bankers that were interested and intrigued by the larger employee stakes. So I don't understand how -- those 2 seem to be in conflict. So maybe could you square those? And would you mind please disclosing the total restricted shares issued to employees just so we could get a sense of ownership?

Okay. Yes, you are misunderstanding the issue. The amount is -- that we did is -- I didn't say it was token. It's -- I would not say it's material to investors from a dilution point of view. It's obviously -- the nature of what was granted is 5-year cliff testing. That means it will flow through our income statement 1/5 per year over the next 5 years. And if you look at the total amounts, which we won't disclose, there's no reason to do that in any greater DSO than what I'm telling you, it's just not that material from a shareholder's point of view. I think I can tell you I think it is meaningful to the people who receive it. But just another point of confusion, I don't think it has anything to do with why people are interested in joining us from outside the firm because they're not -- it's not like they would participate in that. They'll be recruited in a normal way, getting a normal package that we would typically offer a recruit, which will be some level of base, some level of bonus guarantee and some level of restricted stock upfront. That's really not impacted by the recap.

I think people just kind of like -- at least what I got in a sense from the new recruits who appeared is they like the notion of a leveraged upside. They feel like -- they look at the price we're at now. They think about the leverage for the upside, and they think it could be an interesting opportunity to trade RSUs on whatever firm they're at now for RSUs at our firm. And that's really how they're impacted by that.

Okay. And then on the loan, the term loan here, I believe it's either LIBOR plus 3.75% or a base rate plus 2.75%. What is that base rate?

Base rate is prime. And I think you can typically count on us doing a LIBOR plus 3.75% is what -- it's kind of the way we think of the loans, there are certain conventions in kind of the way the documentation is put together, but it's essentially a LIBOR plus 3.75% loan is the way we're thinking about it.

Okay. And then last one for me. You indicated -- I think you indicated global retainer revenue was up versus last year. And so maybe would you mind disclosing what those figures are on a dollar basis?

No. We don't give that kind of detail. It just doesn't make sense. Even like for the capital advisory, obviously, I've given a pretty clear indication it was a strong quarter for both the primary and even stronger for the secondary business. But I think given the scale of our firm, it makes sense once a year to go into a lot of detail on what sectors, what regions, what types of business generated revenue, and certainly, we'll do that this year again after the fourth quarter. But on a quarterly basis, it gets fairly nonmeaningful, so we'll wait to do it in the ordinary way at year-end.

Well, yes. I mean, I guess this is not exactly an ordinary quarter. You just went through a huge recap. You've got folks who are considering taking your bid here at $17.25 versus sticking around. So I would think that some additional disclosure might be -- might actually be helpful in allowing people to understand where things are because when you look at the public data, the health of -- I know you have assured us that you guys are working on a great many deals and that there are a great many bankers who are very interested in working at Greenhill. So -- yet the public data doesn't really support that, and so hoping to get a few more additional metrics. Maybe you could consider that down the road if you don't want to do it tonight.

Look, I think there's an awful lot of information out there about us, and people can every day make a buy or sale decision based on what's there. There's a long history. There's a fair amount of information about the different ways we make business -- make revenue. And I've given, I think, a good update today on the capital advisory business. M&A has always been a more visible part of the business. And I've tried to give some directional views as I always do about the future. And I think there's -- as I said, we're not that complicated a firm, so I think people can pretty readily make buy or sale decisions every day if they wish.

Our next question comes from Jeff Harte of Sandler O'Neill.

Just a couple of cleanups for me. When we look forward, and I'm thinking about the share count here, once the buyback is done and the shares that you're buying are done and the RSUs to employees, kind of once we get through all that, I mean, I guess I'm kind of thinking we'll be looking at an 18 million, 19 million diluted share count. Is that in the ballpark of being right?

I think that's in the ballpark. Obviously, it will depend on the kind of average price we buy back shares, but it's somewhere in that ballpark.

Okay. And the term loan being LIBOR plus 3.75%, is this something you would consider or allow to slot floating to fixed? Or just -- would you intend to just leave it floating?

I think -- well, I think we have the ability to do things like that. I suspect most likely we'll leave it where it is. It's -- one of the things about the loan and the whole deal is it's not -- I mean, as much as I find very, very attractive the rates we're at, especially if I think about them on an after-tax basis, if we get a couple of quarter point raises out of the Fed, it's not going to make an enormous difference to us after tax. So we'll hope rate -- the base rates stay pretty low, but I don't think there's too much risk for us to worry about there.

Okay. And kind of with the recap coming through and all that, has there been any cash repatriations from overseas? Has it enhanced your access to cash overseas? And is there anything about the non-U. S. cash that changes with this?

No. Nothing really changes. There -- certainly, the recap of the loan doesn't impact anything in any way. It probably makes it less of an issue, frankly, because now we're not going to be needing every quarter to pay off a large amount of the ongoing cash flow for dividend. So I think in some ways, maybe it reduces the short-term kind of issue related to overseas cash. Longer term, the key change would still be a change in U.S. corporate tax rate if it went to 25% or even less. I know it's been proposed to 20%, but even at 25%, it would make our cash pretty much fungible around the world. But this whole issue, I think, is less important now than it was pre our recap announcement.

Our last question comes from Steven Chubak of Nomura.

So wanted to kick things off with just a question on the deal structure and, Scott, the question we've gotten quite often from folks. But just given the attractiveness, which you said on this call numerous times, of leveraged upside, high employee ownership and just your general confidence in improving M&A backdrop, why not simply go private? Why sort of take this half measure with the leverage recap?

A few different reasons. One, I really do believe in the public company model. I think senior employees want to know what the value of their equity is. So I think if one were to take a firm like ours private, I think one would very quickly start thinking about how would you take a public again at some point to get people liquidity. So I don't really see the benefit of going private in that regard. .

Two is I think it's better to give shareholders options. And if shareholders would like to cash out, they certainly will have that option, and we'll be buying in the market for some time here. On the other hand, if somebody wants to stay in, they're more than welcome to stay in there. We're enthusiastic about them staying in as a matter of fact. And so I think to make an offer where you're trying to sort of squeeze everybody out at a particular price seems less shareholder friendly to me than what we've offered.

I think what we offer is kind of a perfect halfway house to get -- let shareholders have a choice as to what they would like to do. It gives employees more leveraged upside. It gives them a bigger ownership by not participating in the tender offer, management, key employees and so on. And so I think it makes a lot of sense to do exactly what we did, which is kind of halfway between the historic unlevered structure we always had and the going private transaction.

And one of the things that you mentioned is just thinking around like how much -- what's the value opportunity or proposition for prospective investors. I was hoping you could maybe just outline or articulate, like, what's the investment case that you've discussed or -- to potential prospective investors as pro forma the leverage recap or pro forma leverage structure? And the reason I ask is we're getting this question quite often with regards to what's the growth outlook that you envisage for the business as you get to a more normalized path. And what's a reasonable multiple given that you're significantly more levered than many of your peers?

Yes. Look, I'm going to absolutely leave to people like you and even more importantly shareholders day-to-day to figure out what the multiple is. But I would say this, first of all, I'm not out sort of actively marketing to shareholders. We're obviously in the middle of a transaction, so we're not -- it's not something we're sort of actively doing at the moment, but I certainly heard from a lot of existing shareholders and prospective shareholders. And I think it always catches investors' attention when there's a large share repurchase. It probably catches their attention more when it's one that the insiders are not participating in.

It always catches people's eye when there are large insiders buying with new cash, and they see that here, and they also see a firm that's got a very long, successful history but has gone through a period of weakness in the last few quarters and with much lower share price. So beauty is in the eye of the beholder, I guess, but some people look at all that and say, "Hey, that sounds like a bottom. I'd like to buy into that." I'm sure other people feel like that there is liquidity being offered, and maybe that's of interest. So it's -- I think there's a -- I'm sure there's a case to be made on both sides.

And last one for me, Scott. Certainly, one of the encouraging signs that we saw in the quarter is the strength in the primary and secondary capital advisory businesses. I know you've given some general color there, and you said that you quantify at least the contributions for the full year at year-end. But was hoping you could just speak generally, given the current pipeline that you see within those businesses, is that level of elevated activity still sustainable at least in the near to intermediate term?

I think we feel good about both of those businesses. I'm not going to say kind of quarterly predictions to them. But I think, certainly, it looks like it's going to be a much improved year for both of them, primary and secondary, and a particularly strong one for secondary. And certainly, the ongoing pace of activity is that we continue to feel good about the medium to longer-term outlook for both businesses.

We have very strong market positions in terms of where we stand relative to competitors. Those are businesses that have far fewer competitors than, say, M&A or restructuring business, so it's a strong competitive position and a pretty active market. So yes, we feel pretty good about both of those for the near to medium term. Okay. And I think that's our last call. So thanks, everybody, for joining, and we'll speak again in a few months.

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