Moelis & Co (MC) 2022 Q4 法說會逐字稿

Good afternoon and welcome to the Moelis & Company Earnings Conference Call for the Fourth Quarter of 2022. To begin, I'll turn the call over to Mr. Matt Tsukroff.

下午好，歡迎來到 Moelis & Company 2022 年第四季度收益電話會議。首先，我將把電話轉給 Matt Tsukroff 先生。

Good afternoon and thank you for joining us for Moelis & Company's Fourth Quarter 2022 Financial Results Conference Call. On the phone today are Ken Moelis, Chairman and CEO; and Joe Simon, Chief Financial Officer.

下午好，感謝您參加我們的 Moelis & Company 2022 年第四季度財務業績電話會議。今天接電話的是董事長兼首席執行官 Ken Moelis；和首席財務官 Joe Simon。

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

在我們開始之前，我想指出，在本次電話會議上發表的言論可能包含某些受各種風險和不確定因素影響的前瞻性陳述，包括 Moelis & Company 提交給美國證券交易委員會。實際結果可能與目前預期的結果大不相同。公司不承擔更新任何前瞻性陳述的義務。

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

我們今天的評論包括對某些調整後的財務措施的提及。我們認為，這些措施與可比的 GAAP 措施一起提出時，有助於投資者比較我們在多個時期的業績並更好地了解我們的經營業績。這些調整後的財務措施與 Reg G 要求的相關 GAAP 財務信息和其他信息的對賬在公司的收益發布中提供，可以在我們的投資者關係網站 investors.moelis.com 上找到。

I will now turn the call over to Joe to discuss our results.

我現在將電話轉給喬討論我們的結果。

Thanks, Matt. Good afternoon, everyone. On today's call, I'll go through our financial results and then Ken will comment further on the business. First, we achieved $202 million of adjusted revenues in the fourth quarter. For the full year, our adjusted revenues of $970 million were down 38% from the record prior year. Regarding expenses, our full year compensation expense ratio is 63%. For the full year, we reported a non-compensation ratio of 15.6%. The increase in full year non-compensation expenses is largely due to a normalization of travel and related expenses.

謝謝，馬特。大家下午好。在今天的電話會議上，我將審閱我們的財務業績，然後肯將進一步評論業務。首先，我們在第四季度實現了 2.02 億美元的調整後收入。全年，我們調整後的收入為 9.7 億美元，比上一年的創紀錄水平下降了 38%。關於費用，我們全年的補償費用率為63%。對於全年，我們報告的非補償率為 15.6%。全年非薪酬費用的增加主要是由於差旅和相關費用的正常化。

Looking to the first quarter, we expect non-compensation expenses to be in the $40 million range, excluding episodic transaction-related costs. Our full year pretax margin is 22.5%. Regarding taxes, our normalized corporate tax rate for the year was approximately 27% and our effective tax rate was approximately 22%. The difference is driven primarily by excess tax benefits related to the delivery of equity-based compensation in the first quarter of 2022. We may recognize a tax benefit in the first quarter of 2023 related to the annual vesting of RSUs later this month.

展望第一季度，我們預計非薪酬支出將在 4000 萬美元左右，不包括偶發性交易相關成本。我們全年的稅前利潤率為 22.5%。關於稅收，我們全年的標準化公司稅率約為 27%，我們的實際稅率約為 22%。造成這種差異的主要原因是與 2022 年第一季度提供基於股權的薪酬相關的超額稅收優惠。我們可能會在 2023 年第一季度確認與本月晚些時候 RSU 年度歸屬相關的稅收優惠。

For purposes of quantifying the excess tax benefit, we expect the impact to EPS to be approximately $0.01 for each $1.25 difference between the vesting and breakeven price of $36 per share. Regarding capital allocation, we remain committed to returning 100% of our excess capital. Our Board declared a $0.60 per share dividend. We will have returned approximately $316 million to shareholders with respect to the 2022 performance year, which includes this declared dividend. And lastly, we continue to maintain a fortress balance sheet with $413 million of cash and liquid investments and no funded debt.

為了量化超額稅收優惠，我們預計歸屬價格與每股 36 美元的盈虧平衡價格之間每相差 1.25 美元，對每股收益的影響約為 0.01 美元。在資本配置方面，我們仍然致力於返還 100% 的過剩資本。我們的董事會宣布派發每股 0.60 美元的股息。我們將在 2022 業績年度向股東返還約 3.16 億美元，其中包括已宣布的股息。最後，我們繼續保持堡壘資產負債表，擁有 4.13 億美元的現金和流動投資，沒有融資債務。

I'll now turn the call over to Ken.

我現在將電話轉給 Ken。

Thanks, Joe. Before I begin, I just want to thank our bankers and the entire organization for their focus on our clients and their commitment to excellence in what has been a challenging year for M&A in the capital markets. The financing markets are the lubricant to complete M&A and financing has been a challenge. Despite the difficulties of completing transactions, our new business origination activities remained strong. However, as long as access to capital is limited, M&A transaction volumes are likely to be less robust.

謝謝，喬。在開始之前，我只想感謝我們的銀行家和整個組織，感謝他們對我們客戶的關注以及他們在資本市場併購充滿挑戰的一年中對卓越的承諾。融資市場是完成併購的潤滑劑，融資一直是挑戰。儘管完成交易存在困難，但我們的新業務開拓活動依然強勁。然而，只要獲得資本的渠道有限，併購交易量就可能不那麼強勁。

We also price our services based on transaction values, which have been lower. And at the same time, we're experiencing inflation in our costs, primarily compensation. The current business environment, however, is the reason that we have maintained an unlevered balance sheet since our founding. This environment will change and our goal is to be ready for it when it does. Restructuring activity is increasing, but this cycle will be longer to fully develop. However, it might also be more sustainable over a longer period of time. Companies took advantage of attractive debt markets between 2019 and 2021 to refinance their debt and are now just beginning to see the higher -- the impact of higher interest rates.

我們還根據較低的交易價值為我們的服務定價。與此同時，我們的成本（主要是薪酬）正在經歷通貨膨脹。然而，當前的商業環境是我們自成立以來一直保持無槓桿資產負債表的原因。這種環境會發生變化，我們的目標是在發生變化時做好準備。重組活動正在增加，但這個週期將需要更長的時間才能充分發展。但是，它也可能在更長的時間內更具可持續性。公司利用 2019 年至 2021 年期間有吸引力的債務市場為其債務再融資，現在才剛剛開始看到更高的 - 更高利率的影響。

Again, global market capitalization has doubled since 2012 and private equity AUM has more than tripled over the past 10 years. As markets expand, transactions follow and there'll be increased demand for high-caliber bankers operating within a focused organization, delivering comprehensive advice. This is the opportunity we are pursuing and the reason why we continue to build for the long-term. We hired 4 new managing directors and promoted 8 since the beginning of the year. By continuing to invest in the platform, I remain confident in our ability to execute for our clients, employees and shareholders.

同樣，全球市值自 2012 年以來翻了一番，私募股權資產管理規模在過去 10 年中增長了兩倍多。隨著市場的擴大，交易隨之而來，對在一個專注的組織內運作、提供全面建議的高素質銀行家的需求也在增加。這是我們正在尋求的機會，也是我們繼續長期建設的原因。自年初以來，我們聘請了 4 名新董事總經理並提拔了 8 名。通過繼續投資該平台，我對我們為客戶、員工和股東執行任務的能力充滿信心。

And with that, I'll open up for questions.

有了這個，我會開放的問題。

(Operator Instructions) The first question is from the line of Devin Ryan with JMP Securities.

（操作員說明）第一個問題來自 JMP 證券公司的 Devin Ryan。

This is Brian McKenna for Devin. So I'm curious how the dialogue with sponsors have trended thus far in 2023 relative to the last couple of months in 2022. Has there been any pickup in conversations? And then are you seeing any early signs of dialogue starting to move through the process towards formal announcements?

我是 Devin 的 Brian McKenna。所以我很好奇與讚助商的對話在 2023 年到目前為止的趨勢如何，相對於 2022 年的最後幾個月。對話有任何進展嗎？然後，您是否看到任何早期跡象表明對話開始朝著正式公告的方向發展？

Yes. I'd say it's fairly volatile. And I think the sponsor dialogue has been improving pretty significantly as of the start of the year. There is an opening in the financing markets. We've actually seen a dividend recap deal, [was in] the sponsor community is a pretty significant event. Terms are better. But it remains to me very volatile as these markets, as I said, I think Chairman Powell effectively shut down the market or really market deteriorated pretty significantly in the September speech at Jackson Hole.

是的。我會說它相當不穩定。我認為自今年年初以來，贊助商對話已經取得了相當大的進步。融資市場出現了空缺。我們實際上已經看到了股息回顧交易，[在]贊助商社區是一個非常重要的事件。條款更好。但對我來說，這些市場仍然非常不穩定，正如我所說，我認為主席鮑威爾實際上關閉了市場，或者實際上市場在 9 月在傑克遜霍爾的演講中顯著惡化。

Last week in the beginning of the year, a lot of the market has taken it to mean party on and started to get fairly optimistic, at least part of the market. But I think it remains volatile. As I said, the indication that we're all waiting around for a single individual statements to me is an indication that the market is not healthy. We hadn't done that for 5 years before that. It's probably not a good indication. But again, the activity level I would have to characterize is getting more active over the last 3 or 4 weeks than 8 weeks prior and maybe significantly so, at least in conversation, I might even say significantly so. But we'll see if the markets hold long enough to complete some of these.

今年年初的上週，很多市場都將其視為派對的開始，並開始變得相當樂觀，至少部分市場是這樣。但我認為它仍然不穩定。正如我所說，我們都在等待對我的單一聲明的跡象表明市場不健康。在那之前，我們已經有 5 年沒有這樣做了。這可能不是一個好的跡象。但同樣，我必須描述的活動水平在過去 3 或 4 週內比之前 8 週變得更加活躍，而且可能顯著如此，至少在談話中，我什至可能會這麼說。但我們要看看市場是否會持續足夠長的時間來完成其中的一些。

Okay. Great. And then just a question on the comp ratio. Assuming the first half of this year is still somewhat slow and then if revenues start to normalize in the back half of the year, should we expect the comp ratio in the first half to be in a similar zip code as the back half of 2022 and then you'll kind of true that up into 3Q and 4Q? Or should we expect somewhat of a steady accrual throughout the year?

好的。偉大的。然後只是關於補償比率的問題。假設今年上半年仍然有些緩慢，然後如果收入在下半年開始正常化，我們是否應該期望上半年的補償比率與 2022 年下半年的郵政編碼相似，並且那麼你會在第三季度和第四季度是真的嗎？或者我們應該期待全年穩定增長嗎？

I'm going to turn it over to Joe for the first quarter because we do have some events in the first quarter that always cause us to have a differential in timing. Our belief is that the general comp ratio of the firm should fall between where it fell over the last 3 or 4 years. Again, depending on revenues because our comp ratio did increase last year based on a very difficult market and our desire to hold the culture and team together. So again, depending on the revenue, I think that's the range we are viewing for the entire year. But I want to turn it over to Joe because we have some first quarter --

我將在第一季度將其交給喬，因為我們在第一季度確實有一些事件總是導致我們在時間上有差異。我們認為，公司的總體薪酬比率應該介於過去 3 或 4 年的下降水平之間。同樣，這取決於收入，因為基於非常困難的市場以及我們希望將文化和團隊團結在一起，去年我們的薪酬比率確實有所增加。所以再次，根據收入，我認為這是我們全年看到的範圍。但我想把它交給喬，因為我們有一些第一季度——

Yes. So in the first quarter, that -- in a couple of weeks, we'll be granting equity. We expense all the equity granted to retirement eligible partners at the time of grant. Accordingly, our pre-bonus comp expense is likely to be much larger in the first quarter than the next 3. So within a challenging revenue environment, which we're still experiencing, the comp ratio is likely to be higher than the target ratio. And I would imagine that we would think of, whatever, probably what you were just describing, it's probably the 6- to 8-point spike in the first quarter. But again, we expect that the full year ratio will settle back, assuming again, revenues pick up.

是的。所以在第一季度，幾週後，我們將授予股權。我們在授予時將授予退休資格合夥人的所有股權計入費用。因此，我們第一季度的獎金前補償費用可能比下一個季度大得多。因此，在我們仍在經歷的充滿挑戰的收入環境中，補償比率可能高於目標比率。而且我想我們會想到，無論如何，可能是你剛才描述的，這可能是第一節的 6 到 8 分飆升。但同樣，我們預計全年比率將回落，再次假設收入回升。

The next question is from the line of James Yaro with Goldman Sachs.

下一個問題來自高盛的 James Yaro。

Ken and Joe, I just wanted to return to previous comments that you made, Ken, in December around the middle markets slowing down quite precipitously. And I -- maybe that's not exactly your language. But I guess the question is, how would you compare and contrast the dialogue across larger versus middle market firms and in terms of your expectations for which might come back to transacting on the M&A side first.

肯和喬，我只想回到你之前發表的評論，肯，在 12 月圍繞中間市場急劇放緩。而我——也許這不完全是你的語言。但我想問題是，您如何比較和對比大型公司與中型市場公司之間的對話，以及您對哪些公司的期望可能首先回到併購方面的交易。

When you say larger, middle, you're talking about the sponsor community?

當你說大、中時，你是在談論贊助商社區嗎？

I mean, I guess it would be interesting to hear both sponsor and strategic from that perspective.

我的意思是，我想從這個角度聽取贊助商和戰略方面的意見會很有趣。

Okay. So I'll start with the strategic dialogue. It's been pretty active. I found the strategics to be -- it's a good time. They don't have -- they have most of it when you talk about investment-grade strategics, has access to financial markets. They -- it's a good time for them. The financing markets have moved in basis points, not in availability. And they do have goals they want to achieve. So they've been actively discussing and a significant amount of transactions. Some of that -- by the way, I do think some of the regulatory environment is also impacting that to the negative, but there is a lot of dialogue there.

好的。所以我將從戰略對話開始。一直很活躍我發現戰略是——現在是個好時機。他們沒有——當你談論投資級戰略時，他們擁有大部分，可以進入金融市場。他們——這對他們來說是個好時機。融資市場的變化是基點，而不是可用性。他們確實有他們想要實現的目標。因此，他們一直在積極討論並進行大量交易。其中一些 - 順便說一句，我確實認為一些監管環境也在對其產生負面影響，但那裡有很多對話。

On the sponsor community, I believe there is a huge pent-up demand. Sponsors cannot sit still. I'm not sure it's that different within large and middle market because both are trying to figure out an economy and a cost of capital that makes sense for them to invest in. So I think some of the larger ones have switched their focus maybe to providing other sorts of capital and might be more active just because they can more easily deploy their capital in other areas and maybe they also have -- get more pockets of alternative capital, providing solutions, preferreds, things of that nature.

在讚助商群體中，我相信存在巨大的被壓抑的需求。贊助商不能坐以待斃。我不確定在大型和中型市場中是否有什麼不同，因為兩者都在試圖找出對他們投資有意義的經濟和資本成本。所以我認為一些較大的市場可能已經將重點轉移到提供其他類型的資本，並且可能更加活躍，因為他們可以更輕鬆地將資本部署在其他領域，也許他們也有——獲得更多的替代資本，提供解決方案、首選等性質的東西。

So -- but the dialogue is definitely, I'd say, improving. I think October, November, December, you really had a wait-and-see attitude. They knew that they were in the middle of a cycle of interest rate raises. I think now you're starting to see people take a view that we are possibly near the end. Some people want to be more aggressive on that. But that's what makes markets. But I think you're having some part of the market, say, I think I see 1 or 2 raises. And as soon as that's done, I really think most of them feel like it's time to start figuring out prices, accessing financing markets at the new levels and moving on.

所以——但我想說，對話肯定在改進。我認為10月、11月、12月，你們真的是持觀望態度。他們知道他們正處於加息週期的中間。我想現在你開始看到人們認為我們可能已經接近尾聲了。有些人想在這方面更加積極。但這就是造就市場的原因。但我認為你有一部分市場，比如說，我認為我看到了 1 或 2 次加薪。一旦完成，我真的認為他們中的大多數人覺得是時候開始計算價格、進入新水平的融資市場並繼續前進了。

Okay. That's incredibly helpful. Just for my follow-up, when you think about some of the -- putting aside M&A and restructuring, what do you think about your capital advisory businesses, in particular, the sort of fundraising businesses, how do you expect that -- those to perform over the course of 2023 and what appears to be a somewhat more challenged sponsor fundraising backdrop?

好的。這非常有幫助。就我的後續行動而言，當你考慮一些 - 拋開併購和重組，你如何看待你的資本諮詢業務，特別是那種籌款業務，你如何期望 - 那些在 2023 年期間表現如何，贊助商籌款背景似乎更具挑戰性？

Well, last year, I think last year was a unique year. There was a lot of capital committed going into the year, then everybody talks about the numerator-denominator problem. You had a shrinkage in the denominator, total assets under management as all assets shrunk. And therefore, people ran out of ability to commit. Now I think that slate starts clean in January. And again, it will depend if the denominator holds and we have markets -- public markets that hold.

好吧，去年，我認為去年是獨一無二的一年。這一年投入了大量資金，然後每個人都在談論分子-分母問題。你的分母縮水了，管理的總資產隨著所有資產的縮水而縮水。因此，人們沒有能力做出承諾。現在我認為從 1 月開始一切都平淡無奇。再一次，這將取決於分母是否成立以及我們是否有市場——公開市場是否成立。

So I think that might return over the course of the year to a positive fundraising market. And what we're really focused on is more secondaries, continuation funds, a little more higher value-add part of that process. And I do think that we'll be active. And we're building into that part of the private equity services much more than primary fundraising.

所以我認為這可能會在今年恢復到積極的籌款市場。我們真正關注的是更多的二級、延續基金，以及該過程中更高附加值的部分。我確實認為我們會很活躍。我們正在建立私募股權服務的那一部分，而不僅僅是初級籌款。

That's incredibly clear.

這非常清楚。

The next question is from the line of Ken Worthington with JPMorgan.

下一個問題來自摩根大通的 Ken Worthington。

Hello. This is Michael Cho for Ken. Ken, Joe, I just wanted to just touch on your restructuring business. I was hoping I can -- we can just get some updated commentary on kind of how mandates have trended sequentially? And if there's any particular industries or geographies that have been more active than others recently?

你好。我是 Ken 的 Michael Cho。肯，喬，我只想談談你們的重組業務。我希望我能——我們可以得到一些關於授權順序趨勢的最新評論？最近是否有任何特定行業或地區比其他行業或地區更活躍？

So on the geographies, I can't discern a real difference. I mean I think the main markets are Europe and the U.S. where you see they're pretty much going into the cycle in a similar way, facing the same issues, whether people want to get ahead of the cycle and manage their liabilities. What was interesting is, again, we've said it was slower than the crisis restructuring markets of '08, '09 and even COVID. But this idea that the maturity wall was going to force people to -- there's always a discussion if there's a large maturity wall in '24 and '25, I think. I think -- I do not think that maturity wall will be as much of a motivating force as people are thinking.

所以在地理上，我看不出真正的區別。我的意思是，我認為主要市場是歐洲和美國，你會看到他們幾乎以類似的方式進入周期，面臨著同樣的問題，人們是否想領先於週期並管理他們的債務。有趣的是，我們再次說過，它比 08 年、09 年甚至 COVID 的危機重組市場要慢。但是這種成熟牆將迫使人們這樣做的想法——我認為，如果在 24 年和 25 年有一個大的成熟牆，總是會有討論。我認為——我不認為成熟牆會像人們想像的那樣成為一種激勵力量。

If the market stays at least where it is today, all of a sudden, financing markets are opening up, people are finding solutions to not restructure but to access capital. By the way, it's one of the reasons why I think the previous questions was about our private funds group, but we have beefed up our capital advisory group because we think innovative financings around that marginal 1 turn of leverage that you just have to solve in order to access the bank market and the private lending market. We think there'll be a lot of activity around that last turn of leverage that just keeps companies from having to enter restructuring. And that might actually be more active than the restructuring that every -- that people were focused on.

如果市場至少保持在今天的水平，突然之間，融資市場正在開放，人們正在尋找解決方案，而不是重組，而是獲得資本。順便說一下，這就是為什麼我認為之前的問題是關於我們的私人基金小組的原因之一，但我們加強了我們的資本諮詢小組，因為我們認為創新融資圍繞著你必須解決的邊際 1 輪槓桿准入銀行市場和民間借貸市場。我們認為，圍繞最後一輪槓桿作用有很多活動，這只會讓公司不必進行重組。這實際上可能比人們關注的每個人都關注的重組更積極。

Again, it is improving, but I do think we're not seeing stress. I was just with a major -- one of the leaders of a large group of private equity firms and they said there's no distress in the portfolio, no defaults. And companies are actually performing. And if the financing markets come back, I think the wall will take care of itself. Now that's a lot of what ifs though that the financing market could change and as I say, in a Jay Powell speech. But for now, they are trending in the direction of being accessible.

同樣，它正在改善，但我確實認為我們沒有看到壓力。我剛剛和一個專業的人在一起——一大群私募股權公司的領導者之一，他們說投資組合中沒有困難，沒有違約。公司實際上正在執行。如果融資市場回歸，我認為這堵牆會自行解決。現在有很多假設，儘管融資市場可能會發生變化，正如我在傑伊·鮑威爾 (Jay Powell) 的演講中所說的那樣。但就目前而言，它們正朝著易於訪問的方向發展。

That's great. And I guess just to follow up on that. And just relating to your business today in terms of restructuring, I guess, behind those comments, I mean, is it fair to say you've seen some, I guess, deceleration of growth in terms of the mandate trends or for the "pretty strong" for the quarter as well?

那太棒了。我想只是跟進一下。我想，就重組而言，與您今天的業務有關，我想，在這些評論的背後，我的意思是，我想，您是否已經看到一些授權趨勢或“漂亮”方面的增長減速？本季度也很強勁？

They've been accelerating and they were building toward what I think was everybody looking -- again, when I say everybody, there's always a restructuring going on somewhere even in a good economy, 1% or 2% of the companies are having distress that needs to be addressed immediately. But the idea of getting in front of a '24, '25 wall, which was in -- it was getting in vogue in the late part -- half of last year that there would be no access, so get ahead of it. I think you're going to see companies delay and think about whether or not the financing markets might open again and give them a chance to regular way finance.

他們一直在加速，他們正在朝著我認為每個人都在看的方向發展——再一次，當我說每個人時，即使在經濟良好的情況下，也總會在某個地方進行重組，1% 或 2% 的公司感到苦惱需要立即解決。但是在 24 年、25 年的牆前的想法，在去年的一半時間裡——它在後期變得流行——將無法進入，所以要搶在前面。我認為你會看到公司推遲並考慮融資市場是否可能再次開放並給他們一個通過常規方式融資的機會。

So yes, our backlog is increasing. Our M&A -- our restructuring volume was up significantly year-over-year. But the idea that the wave of '24, '25 maturities would cause people to accelerate their plan to address their liabilities. I think it's slowing down a little bit. I think there's a hope and a belief that the capital markets might open and give people a regular way access to refinancing.

所以是的，我們的積壓工作正在增加。我們的併購——我們的重組量同比大幅增長。但 24 和 25 年到期的浪潮會促使人們加快解決債務的計劃。我認為它正在放緩一點。我認為有希望和信念認為資本市場可能會開放並為人們提供一種定期獲得再融資的途徑。

Okay. Great, great. And if I could just squeeze one more in on the other side of the business when we kind of think about the M&A environment. I mean, you've made it clear around retaining culture and continuing to invest and the MD headcount continues to develop as well. I guess just near term, just given your statement around caution around the deal environment, I mean, do you think there's kind of a stabilized or normalized MD count number for this type of environment looking ahead in the near term?

好的。很棒很棒。當我們考慮併購環境時，如果我能在業務的另一端再擠一個人。我的意思是，你已經明確表示要保留文化並繼續投資，而且 MD 員工人數也在繼續增長。我想就在短期內，鑑於你對交易環境的謹慎態度，我的意思是，你認為短期內這種類型的環境有穩定或標準化的 MD 計數嗎？

Which type of environment are you referring to? The environment seems -- it's like this weather and you're living in New Hampshire. As I said, look, we want to build -- we have a lot of white space we can build to. What our goal in managing the company we do it every year is to go through our labor force which is now 1,000 people and figure out who's not right, who's not going to -- who's not the right skill set and proactively address that and then continue to build around people who can address it and create quality.

您指的是哪種環境？環境似乎——就像這樣的天氣，而你住在新罕布什爾州。正如我所說，看，我們想要建造——我們有很多可以建造的空白空間。我們每年管理公司的目標是檢查我們現在有 1,000 人的勞動力，找出誰不合適，誰不會——誰不具備合適的技能，並主動解決這個問題，然後繼續以能夠解決問題並創造質量的人為中心。

I do believe we're going to look back. At some point, I hope it's months and soon, but there is a large pent-up demand for our clients to transact and to move forward. And lastly, one of the challenges we have is those clients, which we fought hard to get in the front door, both strategics and sponsors, we talk about sponsors. But behind every sponsor transaction is an actual company with the CEO and a CFO who we get to know these things aren't awarded like apples off the tree, you develop relations and expertise in that system as well.

我相信我們會回顧過去。在某個時候，我希望它是幾個月和很快，但我們的客戶有大量被壓抑的需求來進行交易和前進。最後，我們面臨的挑戰之一是那些我們努力爭取進入前門的客戶，包括戰略和讚助商，我們談論贊助商。但每筆贊助商交易的背後都是一家擁有 CEO 和 CFO 的實際公司，我們了解到這些事情並不是像蘋果一樣從樹上掉下來的，你也在該系統中發展關係和專業知識。

And we can't go dark on them and just say, so long your team is not around for the next 6 months, but we'll hire a team back when you want to transact. So I think we will continue to grow the footprint, but we will continue to also be very diligent in making sure that we're focusing on the bottom couple of percentile that we think does not make it and be very careful, especially in a bad environment that we're analyzing that carefully and moving as quickly as we think we -- as we should.

我們不能對他們保持沉默，只是說，只要你的團隊在接下來的 6 個月內不在，但當你想進行交易時，我們會重新僱用一個團隊。所以我認為我們將繼續擴大足跡，但我們也將繼續非常努力地確保我們專注於我們認為沒有做到的最低的幾個百分位數，並且要非常小心，尤其是在糟糕的情況下我們正在仔細分析的環境，並按照我們認為的速度——我們應該這樣做。

That's great.

那太棒了。

The next question is from the line of Brennan Hawken with UBS.

下一個問題來自瑞銀集團的 Brennan Hawken。

Just wanted to follow up on that a little bit and maybe clarify. So has some of that work already started on going through and parsing through the workforce and the talent you have and the bankers and whether or not everybody's got the right skill set because when you look at -- I think it's 151 MDs in the release, it seems like that includes the 8 promotions and the 4 external hires suggest that the year-end was like around 139, but maybe there was already some review or maybe I'm not backing into the right year-end number. So has that review process begun already? And what was the year-end MD headcount?

只是想稍微跟進一下，也許可以澄清一下。因此，其中一些工作已經開始通過勞動力和你擁有的人才以及銀行家進行分析，以及是否每個人都擁有正確的技能組合，因為當你看到 - 我認為發佈時有 151 個 MD，似乎這包括 8 次晉升和 4 次外部聘用，這表明年底大約是 139 人，但也許已經有一些審查，或者我可能沒有支持正確的年終數字。那麼審查過程已經開始了嗎？年終 MD 人數是多少？

Well, first of all, that review happens every year. And sometimes during the year, that's our job, is to manage that workforce and stay on top of it. And Joe has just shown me what the end of the year headcount was. 142, the answer to your end of the year headcount. But look, we do that every year. And all I'd say when it gets tough, you might -- if the bar is 2%, you might go to 3% of the system. We're not looking at it as a change, Brennan. We're looking at it as something we do every year. We do it midyear. We do it all year, by the way. We have these conversations. We don't wait and do it once a year. But that's always ongoing. And so yes, the answer to you is that, that process has begun because it's continuous.

好吧，首先，審查每年都會進行。在一年中的某些時候，這就是我們的工作，就是管理員工隊伍並保持領先地位。喬剛剛向我展示了年底的員工人數。 142，你年終人數的答案。但是你看，我們每年都這樣做。我要說的是，當它變得艱難時，你可能會——如果標準是 2%，你可能會達到系統的 3%。布倫南，我們不認為這是一種改變。我們將其視為我們每年都會做的事情。我們在年中做。順便說一句，我們全年都這樣做。我們有這些對話。我們不等待，每年做一次。但這始終在進行中。所以是的，對你的回答是，這個過程已經開始，因為它是連續的。

Fair enough. A good hygiene. I get it. So the -- I'd love to clarify, you guys gave a little color on near-term expectations of comp ratio and whatnot. It sounds like we'll see some noise here and you seem to expect that the comp ratio will come down as the revenue ramps. So the ratio seems like maybe in this environment so uncertain, maybe more of an output.

很公平。衛生好。我得到它。所以——我想澄清一下，你們對薪酬比率等的近期預期給出了一些顏色。聽起來我們會在這裡看到一些噪音，你似乎預計補償比率會隨著收入的增加而下降。所以這個比率似乎在這種環境下可能如此不確定，也許更多的是輸出。

So another way to maybe ask the question might be how should we think about fixed expense comp. And you spoke -- I think, Ken, you spoke to continued inflation in banker cost. Is that on the fixed side? Or is that a comment about recruiting? And how much should we think about that fixed expense base growing in 2023 based on what you know today?

所以另一種問這個問題的方法可能是我們應該如何考慮固定費用補償。你說 - 我認為，肯，你談到了銀行家成本的持續通貨膨脹。那是在固定的一面嗎？或者這是關於招聘的評論？根據您今天所了解的情況，我們應該對 2023 年增長的固定費用基數有多少考慮？

Yes. Well, we don't have a fixed expense side that we keep -- if you -- first of all, the managing director pool of the firm is down very significantly in line with revenues. You can think on that. I don't have the exact number. I can get it for you. But the managing director pool, which we view as our equity partners and the outcome of the firm are very definitely down. What happens is I think we all fought -- all the firms, especially probably the boutiques, fought very hard to keep their talent. 2021, I get my years mixed up.

是的。好吧，我們沒有保留的固定費用方面——如果你——首先，公司的常務董事人數與收入顯著下降。你可以考慮一下。我沒有確切的數字。我可以給你拿來。但我們認為作為我們的股權合作夥伴的董事總經理池和公司的結果肯定會下降。發生的事情是我認為我們都在戰鬥——所有的公司，尤其是精品店，都非常努力地留住他們的人才。 2021，我把我的歲月搞混了。

But 2021 was a very difficult year to maintain your workforce in the light of what was a very significant deal stream. So -- and then what happened in 2022 is I think everybody wanted to keep their quality people. We worked really hard to keep them. And there's been some softening, but not much. The inflationary impact on the non-managing director workforce is -- I would just say that compensation level is much stickier than it is for people who are promoted and our equity partners in the outcome of the firm as managing directors.

但鑑於非常重要的交易流，2021 年是維持員工隊伍非常困難的一年。所以——然後在 2022 年發生的事情是，我認為每個人都想留住他們的優秀人才。我們非常努力地留住他們。有一些軟化，但幅度不大。通貨膨脹對非董事總經理勞動力的影響是——我只想說，薪酬水平比晉升人員和我們的股權合夥人在公司結果中作為董事總經理的粘性要大得多。

And when you were talking about the comp ratio, I just want to be clear that we do expense this and it must go in the time period it is in from what I understand, what we call retirement-eligible equity. It just happens to hit in that quarter. And it's -- we expect our comp ratio to be back in line. It's not dependent solely on revenue. There is a significant onetime sort of comp charge that we get hit with on retirement-eligible equity awards in the first quarter.

當你談到薪酬比率時，我只想明確一點，我們確實將其支出，而且根據我的理解，它必須在它所在的時間段內，我們稱之為退休資格股權。它恰好在那個季度出現。而且它 - 我們希望我們的補償比率能夠恢復正常。它不僅僅取決於收入。第一季度，我們在符合退休資格的股權獎勵方面受到了重大的一次性補償費用。

Right. And it's that combined with potentially a more challenging revenue that will give rise to the comp ratio issue that we described earlier. But I -- we've talked about it in the past. We used to disclose fixed, but none of our competitors do. We're at a competitive disadvantage and we really don't want to start sharing that detail. We don't disclose it.

正確的。正是這種情況與可能更具挑戰性的收入相結合，將導致我們之前描述的補償率問題。但是我——我們過去談過這個問題。我們過去常常披露固定的，但我們的競爭對手都沒有這樣做。我們處於競爭劣勢，我們真的不想開始分享那個細節。我們不透露它。

Yes. That's why I was trying to ask for a growth rate rather than an absolute number. I get it. And is the cadence of the quarterly dynamic similar to how it was at least proportionally when you used to disclose it, so we could think about it at least from that seasonal pattern?

是的。這就是為什麼我試圖要求增長率而不是絕對數字。我得到它。季度動態的節奏是否與您過去披露它時至少成比例地相似，所以我們至少可以從季節性模式中考慮它？

I think you're probably -- I think that would probably be difficult. I'm not sure that you would be able to extrapolate that maybe on a full year basis. But again, you'd have to embed some inflation in that as well.

我認為你可能 - 我認為這可能很困難。我不確定您是否能夠以全年為基礎進行推斷。但同樣，你也必須在其中嵌入一些通貨膨脹。

All right. All right. I'll stop trying to poke around the [indiscernible] because I don't think you guys want to play Pat-a-Cake with me. Shifting gears a little bit here, Ken, your comments, you recognize the short-term environment is somewhat cautious, but you're optimistic over the long run, that's fair. What -- based on what you can see today and what your expectations are, do you think it's -- 2023 will be a year where you can grow revenue? Or do you think that the challenges are pretty significant and it's kind of hard to make that call at this stage?

好的。好的。我將停止嘗試在 [音頻不清晰] 周圍閒逛，因為我認為你們不想和我一起玩 Pat-a-Cake。在這裡稍微換檔，肯，你的評論，你認識到短期環境有些謹慎，但從長遠來看你很樂觀，這很公平。什麼——根據你今天所看到的和你的期望，你認為 2023 年將是你可以增加收入的一年？還是您認為挑戰非常重大，在現階段很難做出決定？

I hope it is. But I -- it's almost impossible. I think anybody making that call would have to be sitting somewhere in the Fed Chairman's brain at this point and I think, by the way, that's -- my view is that's an unhealthy economy. We never had this commentary. I don't -- remembering sitting there wondering, will the Fed Chair smile at the next meeting or what will his intonations be. For the first 7 years, we were a public company. So again, I am optimistic because I think there is such pent-up demand to do things.

我希望是這樣。但我——這幾乎是不可能的。我認為任何發出該呼籲的人此時都必須坐在美聯儲主席的某個地方，我認為，順便說一下，我認為這是一個不健康的經濟。我們從來沒有這樣的評論。我不記得坐在那裡想知道美聯儲主席會在下次會議上微笑還是他的語調會是什麼。在最初的 7 年裡，我們是一家上市公司。因此，我再次感到樂觀，因為我認為做事有被壓抑的需求。

The economy is -- it's a dynamic economy and there are great CEOs and the private equity guys have a lot of capital and they also own a lot of companies. They need to realize value on. There have to be transactions at some point. And how quickly that happens is a little out of my control. But I want to be there when it happens because you -- I was just at a pitch today where we're talking to a client, 6 managing directors in the room. And I'd say the average experience that we've -- most of those people were together for 15 or 20 years, partners. That comes across the client relationship, the culture of the firm being that deep and knowledgeable about each other and being able to finish each other's sentences and know what we want to accomplish.

經濟是——這是一個充滿活力的經濟，有偉大的首席執行官，私募股權公司擁有大量資本，他們還擁有很多公司。他們需要實現價值。在某些時候必須有交易。我無法控制這種情況發生的速度。但是當它發生時我想在那裡，因為你 - 我今天剛剛在一個推銷會上，我們正在與客戶交談，房間裡有 6 位董事總經理。我想說的是我們的平均經驗——大多數人在一起 15 或 20 年，合作夥伴。這涉及到客戶關係，公司的文化對彼此非常了解並且能夠完成彼此的句子並知道我們想要完成什麼。

In my mind, that's worth keeping. You can't -- to the extent you want to be smaller for a couple of minutes, that's a really bad decision when you give up that asset, the asset of a culture and an ability to communicate with 20 years of knowledge of each other. So again, that's a long answer because I really don't know. But I'm fairly optimistic that when it stops, when I think the economy or the markets and feel people get a feeling that the Fed has stopped, I think you'll see a spring uncoiled that will be pretty dramatic.

在我看來，這是值得保留的。你不能——就你想要變小幾分鐘而言，這是一個非常糟糕的決定，因為你放棄了這種資產，一種文化的資產，以及一種相互交流 20 年的知識的能力.再一次，這是一個很長的答案，因為我真的不知道。但我相當樂觀地認為，當它停止時，當我認為經濟或市場以及人們感覺到美聯儲已經停止時，我認為你會看到一個非常戲劇性的彈簧展開。

Okay.

好的。

I just don't know what that date.

我只是不知道那個日期。

Sure. Fair enough. Thanks for the color. Appreciate it.

當然。很公平。謝謝你的顏色。欣賞它。

The next question is from the line of Matt Moon with KBW.

下一個問題來自 KBW 的 Matt Moon。

Hello. Just a couple of clarifying questions for me. Previously, you've talked about kind of the contribution from restructuring being kind of anywhere between 20% to 25% of revenues. Just kind of curious as to where that stood in the fourth quarter and kind of given your commentary just given the backdrop in the environment, is it possible to see that kind of trend higher than the upper bound of that range kind of in the near term?

你好。只是為我澄清幾個問題。此前，您曾談到重組的貢獻在收入的 20% 到 25% 之間。只是有點好奇第四季度的位置，並且考慮到環境背景下的評論，是否有可能在短期內看到高於該範圍上限的趨勢？

Yes. So I think the restructuring, again, it's hard for us to break out totally, but we think it was closer to 10% in the fourth quarter than 20% or 25%. And that's probably -- I think that's the full year that I gave you. Sorry, 10% for the full year and the fourth quarter might be up a little bit. Look, it is possible. But this feeling that there was an immediate wave coming, the company results are not that bad yet. And the financing markets are showing a little bit of blue sky. And so again, we continue to have a lot of conversations and firms that are talking to us about how to negotiate problems they're in.

是的。所以我認為重組，我們很難完全突破，但我們認為它在第四季度接近 10%，而不是 20% 或 25%。這可能是——我想那是我給你的一整年。抱歉，全年 10%，第四季度可能會上漲一點。看，這是可能的。不過這種立竿見影的感覺，公司的業績還算不錯。融資市場也呈現出一點點藍天。因此，我們繼續與我們進行大量對話，並與我們討論如何解決他們所面臨的問題。

Some of those might be just to refinance their debt at some point because the results are good enough and the financing markets open up at a new interest rate. That's not good. If you're a private equity firm, look, that's not perfect for your rate of return on the equity. But it is what it is and they will refinance rather than restructure, which is smart. So we'll see where that all goes. And if the market -- to your point, if the market has another serious downturn or we're all wrong and the Fed has to go to 6% instead of 5%, yes, I do think you'll see a rather significant kick-up in restructuring and it can become that big a force. But I just want to be clear as of right now. This market doesn't feel like that's happening in the short-term.

其中一些可能只是在某個時候為他們的債務再融資，因為結果足夠好並且融資市場以新的利率開放。這不好。如果你是一家私募股權公司，你看，這對你的股權回報率來說並不完美。但事實就是如此，他們將進行再融資而不是重組，這很聰明。因此，我們將看看這一切的去向。如果市場——就你的觀點而言，如果市場再次出現嚴重下滑，或者我們都錯了，美聯儲必須將利率提高到 6% 而不是 5%，是的，我確實認為你會看到相當大的刺激-在重組中，它可以成為一支強大的力量。但我現在只想說清楚。這個市場短期內不會發生這種情況。

Understood. Makes sense. And then shifting gears, Joe, just a couple for you as well. Just curious on the comments just related to kind of the onetime step-up in the first quarter related to the comp ratio of 68 percentage points. Is that off of the full year 2022 number? Or was that after the first quarter of last year? And then once we get to the first quarter when we received that comp ratio, is it fair to think about the full year expectation at that point just excluding that 68% figure?

明白了。說得通。然後換檔，喬，也為你準備了一對。只是對與第一季度與 68 個百分點的補償率有關的一次性提升有關的評論感到好奇。這是 2022 年全年的數字嗎？或者是在去年第一季度之後？然後，一旦我們到達第一季度，當我們收到該補償比率時，考慮當時僅排除 68% 的數字的全年預期是否公平？

Yes. So the first question is what's the base? And I'd say it's the end of year, the 63% is the base on which I would take the 68% spike. And then over the course of the year, we would expect, again, revenue dependent to get back to the kind of low to mid-60 --

是的。所以第一個問題是什麼是基礎？我想說現在是年底，63% 是我採用 68% 峰值的基礎。然後在這一年中，我們再次預計，收入依賴性會回到 60 到 60 左右的那種——

And then last one --

然後是最後一個——

For the full year.

全年。

Yes, yes. Understood. And then last one is just related to the buybacks. It seemed pretty minimal in the quarter. So just curious, just in terms of after a strong year for buyback activity if we should assume given the environmental comments that should be a little bit more cautious on that front kind of at least for the next couple of quarters.

是的是的。明白了。然後最後一個與回購有關。這個季度似乎很少。所以只是好奇，就在回購活動強勁的一年之後，我們是否應該假設考慮到至少在接下來的幾個季度應該在這方面更加謹慎的環境評論。

I don't know. I can't predict the next couple of quarters, but I'd say for the next quarter given the current environment, I would be cautious. But of course, we have this February, we have a vesting event and part of the vesting event is a buyback that's embedded in that. So that's already kind of factored in.

我不知道。我無法預測接下來的幾個季度，但我會說，鑑於當前環境，我對下個季度持謹慎態度。但當然，今年 2 月，我們有一個歸屬活動，部分歸屬活動是嵌入其中的回購。所以這已經考慮在內了。

Understood. Understood.

明白了。明白了。

The next question is from the line of Steven Chubak with Wolfe Research.

下一個問題來自 Wolfe Research 的 Steven Chubak。

This is Brendan O'Brien filling in for Steven. So to start, I guess I wanted to ask on the non-comp expense. It came in lighter than what we were anticipating this quarter. But based on the guidance, it sounds like you're expecting a pretty meaningful step-up sequentially here. So I was hoping you could unpack what is driving that sequential increase and how we should be thinking about the trajectory in non-comps for the remainder of the year.

我是 Brendan O'Brien，代替 Steven。所以首先，我想我想問一下非補償費用。它比我們本季度的預期要輕。但根據指南，聽起來您期待在這裡按順序進行非常有意義的升級。所以我希望你能解開推動連續增長的因素，以及我們應該如何考慮今年剩餘時間非補償的軌跡。

Yes. Yes. So I would not consider that as -- I mean as a sequential increase math-wise, but I think I've been communicating or guiding that [39 to 40] is our underlying run rate. I don't see much of a change to that. And what happened in the fourth quarter was just a series of small nonrecurring benefits that basically added up to a fairly meaningful change. But it's not something that I would be counting on. It's -- the run rate is still the same kind of [39, 40], again, prior to any transaction-related charges that happen episodically.

是的。是的。所以我不會認為這是——我的意思是數學上的連續增加，但我認為我一直在傳達或指導 [39 到 40] 是我們的基本運行率。我認為這沒有太大變化。第四季度發生的只是一系列小的非經常性收益，基本上加起來就是一個相當有意義的變化。但這不是我所指望的。它是——運行率仍然與 [39、40] 相同，再次發生在偶發性發生的任何與交易相關的費用之前。

Got you. And then I guess, Ken, I believe it was last quarter that you indicated that you believe activity would accelerate once there was greater certainty around the path of interest rates. Given we're getting closer to the end of the rate hiking cycle, I want to get a sense as to whether you still expect the Fed pause will serve as a catalyst potentially. Or do we need to see how the environment or the impacts through the macro economy kind of play out before you feel like strategics and sponsors will feel comfortable dipping their toes back in?

明白了然後我想，肯，我相信是在上個季度，你表示你相信一旦利率路徑有更大的確定性，活動就會加速。鑑於我們越來越接近加息週期的尾聲，我想了解一下您是否仍預計美聯儲暫停加息將成為潛在的催化劑。或者我們是否需要先看看環境或宏觀經濟的影響是如何發揮作用的，然後你才會覺得戰略和讚助商會願意重新投入他們的腳趾？

No. No, I think look, if you get -- if the Fed paused today, if there was a breaking newsflash on CNN Fed announces it's done, I think you'd see activity ripped. I really believe that. Remember, what you're seeing now, though, and I keep -- is our fourth quarter, which we're announcing today, is probably transactions that at best started their [earth] in September, October. The first quarter is a reflection of the activity in the conversations you probably had in October, November or maybe September, on some strategic deals, it could go back as far as a year ago. So when we announced our quarter, I hate to say we're almost reporting on the activity of ancient history. It just takes that long to get to the revenue line. So the first quarter is going to reflect November, December or October, November, December, some point like that. If -- as you said, if you could -- if you told me that the Fed announced today that was done, I would say we don't have enough people. We need a bigger boat. I think it would move very rapidly. Now I'm not expecting that, but you asked the question.

不，不，我想看，如果你得到——如果美聯儲今天暫停，如果 CNN 上有突發新聞，美聯儲宣布它已經完成，我想你會看到活動被撕裂。我真的相信。請記住，你現在看到的是我今天宣布的第四季度，可能是最好在 9 月、10 月開始的交易。第一季度反映了您可能在 10 月、11 月或 9 月就某些戰略交易進行的對話活動，它可以追溯到一年前。因此，當我們宣布我們的季度時，我不想說我們幾乎是在報告古代歷史的活動。到達收入線只需要那麼長時間。所以第一季度將反映 11 月、12 月或 10 月、11 月、12 月，諸如此類。如果——正如你所說，如果你可以——如果你告訴我美聯儲今天宣布已經完成，我會說我們沒有足夠的人手。我們需要一艘更大的船。我認為它會非常迅速地移動。現在我沒想到，但你問了這個問題。

Got you.

明白了

There are currently no further questions registered. (Operator Instructions) There are no additional questions waiting at this time. So I'll pass the conference back to Ken Moelis for any closing remarks.

目前沒有其他問題登記。 （操作員說明）此時沒有其他問題等待。因此，我會將會議傳回給 Ken Moelis，聽取任何閉幕詞。

All right. I appreciate everybody's time and we'll talk to you after the first quarter. Thank you.

好的。我感謝大家的時間，我們將在第一季度後與您交談。謝謝。

That concludes the conference call. Thank you for your participation. You may now disconnect your lines.

電話會議到此結束。感謝您的參與。您現在可以斷開線路。