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| Statement |
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| So we're winning high-quality mandates |
| Accordingly, consistent with what I said in our last call, we expect our revenue improvement over last year to grow significantly in the second quarter, leading to our best first half in recent years |
| But as markets continue to stabilize, credit conditions improve and global deal activity rebounds from what are very low year-to-date levels, we are well positioned to benefit in quarters to come |
| And I think there's a very good chance that aligns with what's already a bit of an improving environment |
| And -- so I think it probably is part of what is making us optimistic about sort of a longer term, not just boom in restructuring but a longer-term period of like a robust level of activity to keep the team busy and productive |
| By type of advice, corporate M&A is where we see the most opportunity Relative to most of our competitors, we should benefit in the current market from having less of a reliance on financial sponsors than most |
| Our capital advisory team continues to take on attractive new fund placement projects amid what is a challenging fundraising environment and should generate increased revenue as the year goes on |
| We believe our industry sector expertise, our cross-border capabilities and our ability to access public companies are all advantages as we work to build this business |
| So obviously, good to hear about the continued expectation for the best first half in years |
| By region, we expect strong performances in Australia, Canada and Spain as well as improved performances in the U.S |
| Our revenue was $49.7 million for the first quarter, 9% better than last year's first quarter but considerably lower than we would like as a result of what was obviously a very difficult operating environment |
| So I think net-net, we're certainly -- when we look at our own pipeline, we are more optimistic than most others, I think, sound in the market these days |
| We're active in the mining space which -- or there's been some good activity and Canada continues to be a good market for us |
| We are also seeing restructuring activity pick up from the low level last year when credit conditions were favorable for much of the year |
| and Europe and Australia is a smaller market but we're quite excited with what's happening down there as well |
| So it's not just 1 or 2 sectors or 1 or 2 regions where we're seeing good activity |
| We feel like that's a good niche to be in |
| So I understand that you're winning more mandates and the business is performing well at your firm |
| I mean, we're seeing -- I highlighted some of the regions but I mean, our certainly -- some of the things we're excited about in our pipeline, there's a good mix between the U.S |
| And on the primary side, I think we'll get to a good place |
| So I think in most sectors and most regions feels pretty good right now |
| But in sort of the greener energy technologies and pretty much in every other sector, we're involved in; it's a pretty good mix |
| So it feels like it's getting better |
| I think if our results are good which I think they will be |
| While the pace of transactions has been slower than usual in the past couple of quarters given volatile markets, difficult credit conditions and economic uncertainty, we are encouraged by the level of engagement we are seeing, particularly with regard to M&A interest from our corporate clients |
| So I think we'll start to see a positive differential, frankly, in Q2 and going forward from there |
| Notwithstanding that financial sponsors are not a particularly large portion of the M&A market at the moment, given challenging credit market conditions, winning more business from this client group which has enormous dry powder to be deployed once market conditions have stabilized continues to be our central strategic initiative for the future growth of our business |
| Mining and energy is another very active area for us, including newer green energy technologies and our health care and consumer teams are also quite busy |
| I mean as far as the environment goes, I mean, from the firms we're talking to about refinancing, I think the market's actually gotten quite a lot better just recently, certainly than it was at the height of the bank crisis |
| I do think it probably helps us on the restructuring side because if you -- I don't think we're going to see a wave of like massive companies going bankrupt or near bankrupt |
| Statement |
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| And I think the outlook remains challenging looking ahead |
| James Yaro If we just turn to the private fund advisory business, the fundraising backdrop for sponsors has certainly been weaker recently |
| I think there was no doubt we're in what's a challenging market for M&A transactions |
| I mean there's no question that, that is -- it's a challenging fundraising environment and I'm glad that's a very -- really a very small part of our business as compared to M&A or restructuring |
| There's -- I'd say in sort of fossil fuel type energy, I think things are challenged just by the extreme volatility in oil prices and even more natural gas prices |
| There's always less visibility for quarters further out |
| However, already in the second quarter, our absolute dollars of compensation expense will decline significantly back to a normal level |
| And given that it wasn't a real strong revenue quarter, it sort of sticks out more than it otherwise would have |
| And I think that's just a function of if you're a firm many times our size, you're going to be really beholden to how the whole market is doing |
| Clearly, the bar, I guess, is pretty low, just given kind of the cadence of first half for you guys |
| I mean -- so I don't think the loss of regional banks |
| While we don't expect anything like the pandemic period boom in restructurings, we believe it could be at the beginning of a longer period of robust restructuring activity given the current economic circumstances than was the case in the brief pandemic euro restructuring boom |
| And as those costs decline and greater revenue materializes, our objective is to bring our compensation ratio down toward our target range by year-end just as we've done in the past few years |
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