Perella Weinberg Reports First Quarter 2024 Results

Financial Overview - First Quarter

• Revenues of $102 Million, Down 22% From a Year Ago
• Adjusted Pre-Tax Loss of $(18) Million, GAAP Pre-Tax Loss of $(51) Million
• Adjusted EPS of $(0.10); GAAP Diluted EPS of $(0.91)
  

Capital Management

• Strong Balance Sheet with $157 Million of Cash and No Debt
• Repurchased Approximately 2 Million Share Equivalents
• Declared Quarterly Dividend of $0.07 Per Share
• Returned $32 Million in Total to Equity Holders

“Momentum continued across our businesses during the quarter. We advised on three of the fifteen announced transactions year-to-date valued over $10 billion and our announced and pending transaction revenue backlog today is at a record high. We remain focused on executing our clear and simple strategy to scale our business as we continue to advise our clients on their most pressing strategic and financial priorities,” stated Andrew Bednar, Chief Executive Officer.

NEW YORK, May 03, 2024 (GLOBE NEWSWIRE) -- Perella Weinberg Partners (the “Firm” or “PWP”) (NASDAQ:PWP) today reported financial results for the first quarter ended March 31, 2024.

Revenues

For the first quarter of 2024, revenues were $102.1 million, a decrease of 22% from $131.4 million for the first quarter of 2023. Revenues attributed to financing and capital solutions were relatively flat year-over-year, while mergers and acquisition revenues were down, primarily due to elongated transaction closing timelines in the current period.

Expenses

GAAP total compensation and benefits were $115.4 million for the first quarter of 2024, compared to $117.6 million for the first quarter of 2023. Adjusted total compensation and benefits were $86.1 million for the first quarter of 2024, compared to $85.4 million for the same period a year ago. The higher compensation margin seen on both a GAAP and adjusted basis was driven by a year-over-year increase in equity amortization expense related to the phase-in of our annual equity awards, partially offset by a lower bonus accrual compared to last year, combined with the impact of a lower revenue quarter.

GAAP non-compensation expenses were $40.3 million for the first quarter of 2024, compared to $36.5 million for the first quarter of 2023. Adjusted non-compensation expenses were $37.0 million for the first quarter of 2024, compared to $34.5 million for the same period a year ago. The increase in both GAAP non-compensation expenses and adjusted non-compensation expenses was largely driven by an increase in legal spend as well as depreciation expense tied to our New York and London office renovation and relocation, partially offset by lower rent and occupancy costs associated with the end of overlapping rent periods and a decline in some general, administrative and other expenses.

Provision for Income Taxes

Perella Weinberg Partners currently owns 56.7% of the operating partnership (PWP Holdings LP) and is subject to U.S. federal and state corporate income tax on its allocable share of earnings. Income earned by the operating partnership is subject to certain state, local, and foreign income taxes.

For purposes of calculating adjusted if-converted net income (loss), we have presented our results as if all partnership units had been converted to shares of Class A Common Stock, and as if all of our adjusted results for the period were subject to U.S. corporate income tax. For the three months ended March 31, 2024, the adjusted if-converted tax benefit of $8.9 million included a benefit of $2.9 million from the vesting of restricted stock units at a share price higher than the grant price. Excluding the RSU tax benefit, the adjusted effective tax rate for the period would have been 32%.

Balance Sheet and Capital Management

As of March 31, 2024, PWP had $156.7 million of cash with no outstanding indebtedness and an undrawn revolving credit facility.

During the three months ended March 31, 2024, PWP returned $32.2 million in aggregate to our equity holders through (i) the net settlement of 1,872,154 share equivalents to satisfy statutory tax withholding obligations at an average price per share of $13.12 for $24.5 million, (ii) the payment of $2.9 million in distributions to limited partners and (iii) the payment of dividends of $4.8 million on Class A common stock.

During the three months ended March 31, 2024, PWP made $11.1 million of cash payments related to the business realignment initiative undertaken in 2023.

The Board of Directors has declared a quarterly dividend of $0.07 per share of Class A common stock. The dividend will be paid on June 10, 2024 to Class A common stockholders of record on May 28, 2024.

Conference Call and Webcast

Management will host a webcast and conference call on Friday, May 3, 2024 at 9:00 am ET to discuss Perella Weinberg’s financial results for the first quarter ended March 31, 2024.

The conference call will be made available in the Investors section of Perella Weinberg’s website at https://investors.pwpartners.com/.

The conference call can also be accessed by the following dial-in information:

• Domestic: (800) 343-4136
• International: (203) 518-9848
• Conference ID: PWPQ124
  

Replay

A replay of the call will also be available two hours after the live call through May 10, 2024. To access the replay, dial (800) 925-9527 (Domestic) or (402) 220-5388 (International). The replay can also be accessed on the Investors section of PWP’s website at https://investors.pwpartners.com/.

For those who listen to the rebroadcast of the call, we remind you that the remarks made are as of May 3, 2024, and have not been updated subsequent to the initial earnings call.

About Perella Weinberg

Perella Weinberg is a leading global independent advisory firm, providing strategic and financial advice to a broad client base, including corporations, institutions, governments, sovereign wealth funds and the financial sponsor community. The firm offers a wide range of advisory services to clients in the most active industry sectors and global markets. With more than 650 employees, Perella Weinberg currently maintains offices in New York, London, Houston, San Francisco, Paris, Los Angeles, Chicago, Calgary, Denver, and Munich. The financial information of PWP herein refers to the business operations of PWP Holdings LP and Subsidiaries.

Contacts

For Perella Weinberg Investor Relations: [email protected]
For Perella Weinberg Media: [email protected]

Non-GAAP Financial Measures

In addition to financial measures presented in accordance with GAAP, we monitor certain non-GAAP financial measures to manage our business, make planning decisions, evaluate our performance and allocate resources. We believe that these non-GAAP financial measures are key financial indicators of our business performance over the long term and provide useful information regarding whether cash provided by operating activities is sufficient to maintain and grow our business. We believe that the methodology for determining these non-GAAP financial measures can provide useful supplemental information to help investors better understand the economics of our platform.

These non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation from, or as a substitute for, the analysis of other GAAP financial measures. These non-GAAP financial measures are not universally consistent calculations, limiting their usefulness as comparative measures. Other companies may calculate similarly titled financial measures differently. Additionally, these non-GAAP financial measures are not measurements of financial performance or liquidity under GAAP. In order to facilitate a clear understanding of our consolidated historical operating results, you should examine our non-GAAP financial measures in conjunction with our historical consolidated financial statements and notes thereto included elsewhere in this press release.

Management compensates for the inherent limitations associated with using these non-GAAP financial measures through disclosure of such limitations, presentation of our financial statements in accordance with GAAP and reconciliation of such non-GAAP financial measures to the most directly comparable GAAP financial measures. See “Non-GAAP Financial Measures” and the tables at the end of this release for an explanation of the adjustments and reconciliations to the comparable GAAP numbers.

Cautionary Statement Regarding Forward Looking Statements

Certain statements made in this press release, and oral statements made from time to time by representatives of PWP are “forward-looking statements” within the meaning of the federal securities laws, including the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Statements regarding the expectations regarding the combined business are “forward looking statements.” In addition, words such as “estimates,” “projected,” “expects,” “estimated,” “anticipates,” “forecasts,” “plans,” “intends,” “believes,” “seeks,” “may,” “will,” “would,” “future,” “propose,” “target,” “goal,” “objective,” “outlook” and variations of these words or similar expressions (or the negative versions of such words or expressions) are intended to identify forward-looking statements. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside the control of the parties, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements.

Important factors, among others, that may affect actual results or outcomes include (but are not limited to): global economic, business and market conditions; the Company’s dependence on and ability to retain employees; the Company’s ability to successfully identify, recruit and develop talent; conditions impacting the corporate advisory industry; the Firm’s dependence on its fee-paying clients and fluctuating revenues from its non-exclusive, engagement-by-engagement business model; the high volatility of the Company’s revenues as a result of its reliance on advisory fees that are largely contingent on the completion of events which may be out of its control; the Company’s ability to appropriately manage conflicts of interest and tax and other regulatory factors relevant to the Company’s business, including actual, potential or perceived conflicts of interest and other factors that may damage its business and reputation; the Company’s successful formulation and execution of its business and growth strategies; substantial litigation risks in the financial services industry; cybersecurity and other operational risks; assumptions relating to the Company’s operations, financial results, financial condition, business prospects, growth strategy and liquidity; extensive regulation of the corporate advisory industry and U.S. and foreign regulatory developments relating to, among other things, financial institutions and markets, government oversight, fiscal and tax policy and laws (including the treatment of carried interest); and other risks and uncertainties described under “Part I—Item 1A. Risk Factors” in our Annual Report on Form 10-K.

The forward-looking statements in this press release and oral statements made from time to time by representatives of PWP are based on current expectations and beliefs concerning future developments and their potential effects on the Company. There can be no assurance that future developments affecting the Company will be those that the Company has anticipated. These risks and uncertainties include, but are not limited to, those factors described in the section entitled “Risk Factors” in our Annual Report on Form 10-K filed with the SEC on February 23, 2024 and the other documents filed by the Firm from time to time with the SEC. The Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

Consolidated Statements of Operations (Unaudited)
(Dollars in Thousands, Except Per Share Amounts)

GAAP Reconciliation of Adjusted Results (Unaudited)
(Dollars in Thousands, Except Per Share Amounts)

GAAP Reconciliation of Adjusted Results (Unaudited)
(Dollars in Thousands, Except Per Share Amounts)

Notes to GAAP Reconciliation of Adjusted Results:

GAAP Reconciliation of Adjusted Results (Unaudited)
(Dollars in Thousands)