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Lazard Reports Third-Quarter and Nine-Month 2024 Results

By: via Business Wire
  • Firm-wide adjusted net revenue increased 24% year-to-date
  • Financial Advisory adjusted net revenue increased 39% year-to-date
  • Asset Management AUM increased 8% from last year

Lazard, Inc. (NYSE: LAZ) today reported net revenue of $785 million and adjusted net revenue1 of $646 million for the quarter ended September 30, 2024. For the first nine months of 2024, Lazard reported net revenue of $2,235 million and adjusted net revenue1 of $2,077 million.

On a U.S. GAAP basis, Lazard reported third-quarter 2024 net income of $108 million or $1.02 per share, diluted. For the first nine months of 2024, net income was $194 million or $1.88 per share, diluted. For the third quarter of 2024, adjusted net income1 was $40 million or $0.38 per share, diluted. For the first nine months of 2024, adjusted net income1 was $159 million or $1.54 per share, diluted.

“Lazard’s growth strategy continues to gain momentum, with Financial Advisory revenue up 39 percent for the first nine months of this year, 16 new Managing Directors hired year-to-date and our work with private capital expanding,” said Peter R. Orszag, Chief Executive Officer, Lazard. “Asset Management delivered another solid quarter, providing a durable source of revenue for the firm, with assets under management increasing more than 8 percent from a year ago. Lazard’s unique insights into business and geopolitical issues continue to position us well to serve clients and deliver long-term shareholder value.”

(Selected results, $ in millions,

Three Months Ended

 

Nine Months Ended

except per share data and AUM)

September 30,

 

September 30,

U.S. GAAP Financial Measures

2024

 

2023

 

%'24-'23

 

2024

 

2023

 

% '24-'23

Net Revenue

$785

 

$524

 

50%

 

$2,235

 

$1,709

 

31%

Financial Advisory

$371

 

$266

 

39%

 

$1,236

 

$896

 

38%

Asset Management

$294

 

$285

 

3%

 

$875

 

$857

 

2%

 

 

 

 

 

 

 

 

 

 

 

 

Net Income (Loss)

$108

 

$7

 

NM

 

$194

 

($139)

 

NM

Per share, diluted

$1.02

 

$0.06

 

NM

 

$1.88

 

($1.60)

 

NM

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted Financial Measures1

 

 

 

 

 

 

 

 

 

 

 

Net Revenue

$646

 

$532

 

21%

 

$2,077

 

$1,679

 

24%

Financial Advisory

$369

 

$261

 

41%

 

$1,223

 

$879

 

39%

Asset Management

$272

 

$262

 

4%

 

$813

 

$794

 

2%

 

 

 

 

 

 

 

 

 

 

 

 

Net Income

$40

 

$10

 

NM

 

$159

 

$10

 

NM

Per share, diluted

$0.38

 

$0.10

 

NM

 

$1.54

 

$0.10

 

NM

 

 

 

 

 

 

 

 

 

 

 

 

Assets Under Management (AUM)

($ in billions)

 

 

 

 

 

 

 

 

 

 

 

Ending AUM

$248

 

$228

 

8%

 

 

 

 

 

 

Average AUM

$246

 

$236

 

4%

 

$246

 

$233

 

6%

 

 

 

 

 

 

 

 

 

 

 

 

Note: Reconciliations of U.S. GAAP to Adjusted results are shown on pages 13-15. Endnotes are on page 5 of this release.

NET REVENUE

Financial Advisory

For the third quarter of 2024, Financial Advisory reported net revenue and adjusted net revenue1 of $371 million and $369 million, 39% and 41% higher than the third quarter of 2023, respectively.

For the first nine months of 2024, Financial Advisory reported net revenue and adjusted net revenue1 of $1,236 million and $1,223 million, 38% and 39% higher than the first nine months of 2023, respectively.

During and since the third quarter of 2024, Lazard has been engaged in significant and complex M&A transactions globally, including the following (clients are in italics): Kellanova’s $35.9 billion acquisition by Mars; TPG’s €6.7 billion acquisition of Techem with GIC; KPS Capital Partners’ €3.5 billion acquisition of Innomotics from Siemens AG; Vitesco Technologies’ €3.0 billion merger with Schaeffler; Carlyle’s $3.0 billion sale of Cogentrix to Quantum Capital; Air Products & Chemicals’ $1.8 billion sale of its LNG business to Honeywell International Inc.; Macquarie Asset Management’s announced agreement to invest up to $1.725 billion in DE Shaw Renewable Investments; Cupertino Electric’s $1.5 billion acquisition by Quanta Services; Siete Foods’ $1.2 billion acquisition by PepsiCo; Tellurian’s $1.2 billion acquisition by Woodside Energy; Calliditas Therapeutics’ sale to Asahi Kasei for $1.1 billion; Sofidel’s $1.1 billion agreement to acquire Clearwater Paper Corporation’s Tissue Business; Mallinckrodt’s $925 million sale of its Therakos business to CVC Capital Partners; Collegium Pharmaceutical’s $550 million acquisition of Ironshore Therapeutics; Seres Therapeutics’ $505 million sale of its VOWST business to Nestle Health Science; EIG and West Burton Energy’s £450 million sale of is operational CCGT and BESS to TotalEnergies; UCB’s $680 million sale of its neurology and allergy business in China to CBC and Mubadala Investment Company; AffiniPay’s investment from Genstar Capital; Cemex’s sales of its operations in the Dominican Republic and the Philippines; CVC Capital Partners’ investment in Hempel; GenServe’s acquisition by Aurora Capital Partners; Parker Hannifin’s sale of its North America Composites and Fuel Containment Division to SK Capital Partners and Terra-Gen’s sale of a 50% stake in the company previously held by Energy Capital Partners to Masdar.

Lazard’s preeminent restructuring and liability management practice has been engaged in a broad range of complex restructuring and debt advisory assignments, including company roles involving Belk, Consolis, Enviva, LivePerson and Zachry Group and creditor and/or related party roles involving Accuride, KLDiscovery, Rite Aid, SIRVA, SVB Financial Group and Wheel Pros.

Our capital advisory and solutions practices remain active and engaged in assignments, including Altamont Capital Partners’ successful continuation fund vehicle with Tacala; Astorg Partners’ €1.4 billion continuation fund to support Normec; GHK Capital Partners’ closing of its $870 million Fund II; Health Catalyst’s $225 million term loan provided by Silver Point Finance; Hidden Harbour Capital Partners’ closing of its $800 million Fund III; Kingswood Capital Management’s closing of its $1.5 billion Fund III; Kohlberg & Company’s closing of its $4.3 billion fund for Kohlberg Investors X; Ocado’s £1.0 billion capital raise; Phoenix Equity Partners’ £200 million continuation fund and Pure Fishing, a portfolio company of Sycamore Partners, on its $750 million term loan to refinance existing debt provided by Monarch Alternative Capital LP and Silver Point Finance. Our sovereign advisory practice continues to be active in advising governments and sovereign entities across developed and emerging markets.

For a list of publicly announced transactions please visit our website.

Asset Management

For the third quarter of 2024, Asset Management net revenue and adjusted net revenue1 were $294 million and $272 million, 3% and 4% higher than the third quarter of 2023, respectively.

Management fees and other revenue, on an adjusted basis1, were $269 million for the third quarter of 2024, 3% and 2% higher than the third quarter of 2023 and second quarter of 2024, respectively.

Incentive fees on an adjusted basis1, were $3 million for the third quarter of 2024, compared to $2 million for the third quarter of 2023.

Average assets under management (AUM) was $246 billion for the third quarter of 2024, 4% higher than the third quarter of 2023, and in line with the second quarter of 2024.

For the first nine months of 2024, Asset Management net revenue and adjusted net revenue1 were $875 million and $813 million, respectively, both 2% higher than the first nine months of 2023.

Management fees and other revenue, on an adjusted basis1, were $799 million for the first nine months of 2024, 2% higher than the first nine months of 2023.

Incentive fees on an adjusted basis1, were $13 million for the first nine months of 2024, compared to $14 million for the first nine months of 2023.

Average AUM for the first nine months of 2024 was $246 billion, 6% higher than the first nine months of 2023. AUM as of September 30, 2024, was $248 billion, 1% and 8% higher than June 30, 2024 and September 30, 2023, respectively. The sequential change from June 30, 2024 was driven by market appreciation of $9.4 billion, foreign exchange appreciation of $6.0 billion and net outflows of $12.4 billion.

Corporate

For the third quarter of 2024, Corporate net revenue and adjusted net revenue1 were $120 million and $6 million, respectively. For the first nine months of 2024, Corporate net revenue and adjusted net revenue1 were $124 million and $41 million, respectively. On a U.S. GAAP basis, revenue in both periods includes $114 million related to the sale of an office building no longer occupied by Lazard, which resulted in net income of $68 million, or $0.65 per share, diluted2, for the third quarter of 2024, and $0.67 per share, diluted2, for the first nine months of 2024.

OPERATING EXPENSES

Compensation and Benefits Expense

For the third quarter of 2024, compensation and benefits expense on a U.S. GAAP and adjusted basis1 were $465 million and $426 million, respectively, compared to $365 million and $364 million, respectively, for the third quarter of 2023. The adjusted compensation ratio3 for the third quarter of 2024 was 66.0%, compared to the third-quarter 2023 ratio of 68.4%.

For the first nine months of 2024, compensation and benefits expense on a U.S. GAAP and adjusted basis1 were $1,469 million and $1,371 million, respectively, compared to $1,387 million and $1,187 million, respectively, for the first nine months of 2023.

We focus on the adjusted compensation ratio to manage costs, balancing a view of current conditions in the market for talent alongside our objective to drive long-term shareholder value. Our goal remains to deliver an adjusted compensation ratio over the cycle in the mid- to high-50s percentage range, while targeting a consistent deferral policy.

Non-Compensation Expenses

For the third quarter of 2024, non-compensation expenses on a U.S. GAAP basis were $158 million, 4% lower than the third quarter of 2023. On an adjusted basis1, non-compensation expenses were $138 million, up less than 1% from the third quarter of 2023.

The adjusted non-compensation ratio4 was 21.4% for the third quarter of 2024, compared to 25.9% for the third quarter of 2023.

For the first nine months of 2024, non-compensation expenses on a U.S. GAAP and adjusted basis1 were $487 million and $421 million, respectively, 5% and 1% lower than the first nine months of 2023, respectively.

The adjusted non-compensation ratio4 was 20.3% for the first nine months of 2024, compared to 25.2% for the first nine months of 2023.

Our goal remains to deliver an adjusted non-compensation ratio between 16% to 20% over the cycle.

TAXES

The provisions for income taxes, on a U.S. GAAP and adjusted basis1 were $45 million and $19 million, respectively, for the third quarter of 2024. The effective tax rate on an adjusted basis1 was 32.5% for the third quarter of 2024, compared to 8.4% for the third quarter of 2023.

The provisions for income taxes, on a U.S. GAAP and adjusted basis1 were $71 million and $60 million, respectively, for the first nine months of 2024. The effective tax rate on an adjusted basis1 was 27.4% for the first nine months of 2024, compared to 3.9% for the first nine months of 2023.

CAPITAL MANAGEMENT AND BALANCE SHEET

In the third quarter of 2024, Lazard returned $51 million to shareholders, which included: $45 million in dividends; $3 million in share repurchases of our common stock; and $3 million in satisfaction of employee tax obligations in lieu of share issuances upon vesting of equity grants.

In the first nine months of 2024, Lazard returned $242 million to shareholders, which included: $134 million in dividends; $44 million in share repurchases of our common stock; and $64 million in satisfaction of employee tax obligations in lieu of share issuances upon vesting of equity grants.

During the first nine months of 2024, we repurchased 1.1 million shares at an average price of $39.10. Our total outstanding share repurchase authorization is approximately $356 million.

On October 30, 2024, Lazard declared a quarterly dividend of $0.50 per share on its outstanding common stock. The dividend is payable on November 15, 2024, to stockholders of record on November 8, 2024.

Lazard’s financial position remains strong. As of September 30, 2024, our cash and cash equivalents were $1,166 million.

ENDNOTES

Beginning in the first quarter of 2024, Lazard has updated the names of certain non-U.S. GAAP (“non-GAAP”) measures and metrics. The nomenclature change did not result in any change to the components of our non-GAAP measures and metrics compared to prior periods. Reconciliations of U.S. GAAP to Adjusted results are shown on pages 13-15.

1

A non-GAAP measure. Our non-GAAP measures are not meant to be considered in isolation or as a substitute for the corresponding U.S. GAAP measures and should be read only in conjunction with our consolidated financial statements prepared in accordance with U.S. GAAP. See attached financial schedules and related notes for a detailed explanation of adjustments to corresponding U.S. GAAP results. We believe that presenting our results on an adjusted basis, in addition to the U.S. GAAP results, is a meaningful and useful way to compare our operating results across periods.

2

Such amounts are calculated using a numerator of U.S. GAAP net income arising from the sale of the office building of $68 million for the three and nine month periods ended September 30, 2024, and dividing by a denominator consisting of U.S. GAAP weighted average shares of 103,475,234 and 101,151,624 for the three and nine month periods ended September 30, 2024, respectively.

3

A non-GAAP measure which represents adjusted compensation and benefits expense as a percentage of adjusted net revenue.

4

A non-GAAP measure which represents adjusted non-compensation expenses as a percentage of adjusted net revenue.

CONFERENCE CALL

Lazard will host a conference call at 8:00 a.m. ET on October 31, 2024, to discuss the company’s financial results for the third quarter and first nine months of 2024. The conference call can be accessed via a live audio webcast available through Lazard’s Investor Relations website at www.lazard.com, or by dialing +1 800-445-7795 (toll-free, U.S. and Canada) or +1 785-424-1699 (outside of the U.S. and Canada), 15 minutes prior to the start of the call. Conference ID: LAZQ324.

A replay of the conference call will be available by 10:00 a.m. ET, October 31, 2024, via the Lazard Investor Relations website at www.lazard.com, or by dialing +1 800-839-8317 (toll-free, U.S. and Canada) or +1 402-220-6070 (outside of the U.S. and Canada).

ABOUT LAZARD

Founded in 1848, Lazard is one of the world’s preeminent financial advisory and asset management firms, with operations in North and South America, Europe, Middle East, Asia, and Australia. Lazard provides advice on mergers and acquisitions, capital markets and capital solutions, restructuring and liability management, geopolitics, and other strategic matters, as well as asset management and investment solutions to institutions, corporations, governments, partnerships, family offices, and high net worth individuals. For more information, please visit www.lazard.com.

Cautionary Note Regarding Forward-Looking Statements:

This press release contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. In some cases, forward-looking statements can be identified by the use of forward-looking terminology such as “may,” “might,” “will,” “should,” “could,” “would,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “target,” “goal,” or “continue,” and the negative of these terms and other comparable terminology. These forward-looking statements, which are subject to known and unknown risks, uncertainties and assumptions about us, may include projections of our future financial performance based on our growth strategies, business plans and initiatives and anticipated trends in our business. These forward-looking statements are only predictions based on our current expectations and projections about future events. There are important factors that could cause our actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements.

These factors include, but are not limited to, those discussed in our Annual Report on Form 10-K under Item 1A “Risk Factors,” and also discussed from time to time in our Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, including the following:

  • Adverse general economic conditions or adverse conditions in global or regional financial markets;
  • A decline in our revenues, for example due to a decline in overall mergers and acquisitions (M&A) activity, our share of the M&A market or our assets under management (AUM);
  • Losses caused by financial or other problems experienced by third parties;
  • Losses due to unidentified or unanticipated risks;
  • A lack of liquidity, i.e., ready access to funds, for use in our businesses;
  • Competitive pressure on our businesses and on our ability to retain and attract employees at current compensation levels; and
  • Changes in relevant tax laws, regulations or treaties or an adverse interpretation of those items.

These risks and uncertainties are not exhaustive. Our SEC reports describe additional factors that could adversely affect our business and financial performance. Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible for our management to predict all risks and uncertainties, nor can management assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.

As a result, there can be no assurance that the forward-looking statements included in this release will prove to be accurate or correct. Although we believe the statements reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance, achievements or events. Moreover, 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 of this release to conform our prior statements to actual results or revised expectations and we do not intend to do so.

Lazard, Inc. is committed to providing timely and accurate information to the investing public, consistent with our legal and regulatory obligations. To that end, Lazard and its operating companies use their websites, and other social media sites to convey information about their businesses, including the anticipated release of quarterly financial results, quarterly financial, statistical and business-related information, and the posting of updates of assets under management in various mutual funds, hedge funds and other investment products managed by Lazard Asset Management LLC and Lazard Frères Gestion SAS. Investors can link to Lazard and its operating company websites through www.lazard.com.

***

LAZ-EPE

CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS

(U.S. GAAP - unaudited)

 

 

 

Three Months Ended

% Change From

 

September 30,

June 30,

September 30,

June 30,

September 30,

($ in thousands, except per share data)

2024

 

2024

 

2023

 

2024

 

2023

 

 

 

 

 

 

 

 

 

Total revenue

$807,414

 

$707,991

 

$543,170

 

14%

49%

Interest expense

(22,548

)

(22,642

)

(19,252

)

 

 

Net revenue

784,866

 

685,349

 

523,918

 

15%

50%

Operating expenses:

 

 

 

 

 

 

 

 

Compensation and benefits

465,405

 

452,560

 

364,605

 

3%

28%

 

 

 

 

 

 

 

 

 

Occupancy and equipment

34,249

 

32,031

 

33,108

 

 

 

Marketing and business development

21,782

 

25,493

 

20,754

 

 

 

Technology and information services

44,628

 

46,406

 

46,897

 

 

 

Professional services

19,541

 

23,734

 

20,451

 

 

 

Fund administration and outsourced services

27,996

 

27,114

 

27,884

 

 

 

Amortization and other acquisition-related costs

53

 

68

 

96

 

 

 

Other

10,025

 

14,303

 

14,980

 

 

 

Non-compensation expenses

158,274

 

169,149

 

164,170

 

(6%)

(4%)

Operating expenses

623,679

 

621,709

 

528,775

 

–%

18%

 

 

 

 

 

 

 

 

 

Operating income (loss)

161,187

 

63,640

 

(4,857

)

NM

NM

 

 

 

 

 

 

 

 

 

Provision (benefit) for income taxes

45,052

 

11,587

 

(11,631

)

NM

NM

Net income

116,135

 

52,053

 

6,774

 

123%

NM

Net income (loss) attributable to noncontrolling interests

8,197

 

2,144

 

(365

)

 

 

Net income attributable to Lazard, Inc.

$107,938

 

$49,909

 

$7,139

 

116%

NM

 

 

 

 

 

 

 

 

 

Attributable to Lazard, Inc. Common Stockholders:

 

 

 

 

 

 

 

 

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

Basic

93,627,476

 

92,886,364

 

89,425,900

 

1%

5%

Diluted

103,475,234

 

100,627,867

 

94,309,224

 

3%

10%

 

 

 

 

 

 

 

 

 

Net income per share:

 

 

 

 

 

 

 

 

Basic

$1.13

 

$0.53

 

$0.07

 

113%

NM

Diluted

$1.02

 

$0.49

 

$0.06

 

108%

NM

Note: For the three month periods ended September 30, 2024, June 30, 2024 and September 30, 2023, Financial Advisory net revenue was $370,917, $411,308 and $266,048, respectively; Asset Management net revenue was $293,878, $285,487 and $284,855, respectively; Corporate net revenue (loss) was $120,071, ($11,446) and ($26,985), respectively.

CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS

(U.S. GAAP - unaudited)

 

 

Nine Months Ended

 

September 30,

 

September 30,

 

 

($ in thousands, except per share data)

2024

 

2023

 

% Change

 

 

 

 

 

 

Total revenue

$2,300,886

 

 

$1,767,399

 

 

30%

Interest expense

(65,918

)

 

(57,931

)

 

 

Net revenue

2,234,968

 

 

1,709,468

 

 

31%

Operating expenses:

 

 

 

 

 

Compensation and benefits

1,468,789

 

 

1,386,803

 

 

6%

 

 

 

 

 

 

Occupancy and equipment

99,137

 

 

97,681

 

 

 

Marketing and business development

70,874

 

 

72,098

 

 

 

Technology and information services

135,951

 

 

142,307

 

 

 

Professional services

63,155

 

 

66,179

 

 

 

Fund administration and outsourced services

81,250

 

 

83,428

 

 

 

Amortization and other acquisition-related costs

189

 

 

239

 

 

 

Other

36,235

 

 

53,022

 

 

 

Non-compensation expenses

486,791

 

 

514,954

 

 

(5%)

Benefit pursuant to tax receivable agreement

–

 

 

(40,435

)

 

 

Operating expenses

1,955,580

 

 

1,861,322

 

 

5%

 

 

 

 

 

 

Operating income (loss)

279,388

 

 

(151,854

)

 

NM

 

 

 

 

 

 

Provision (benefit) for income taxes

70,976

 

 

(23,053

)

 

NM

Net income (loss)

208,412

 

 

(128,801

)

 

NM

Net income attributable to noncontrolling interests

14,810

 

 

10,245

 

 

 

Net income (loss) attributable to Lazard, Inc.

$193,602

 

 

($139,046

)

 

NM

 

 

 

 

 

 

Attributable to Lazard, Inc. Common Stockholders:

 

 

 

 

 

Weighted average shares outstanding:

 

 

 

 

 

Basic

92,591,435

 

 

88,582,468

 

 

5%

Diluted

101,151,624

 

 

88,582,468

 

 

14%

 

 

 

 

 

 

Net income (loss) per share:

 

 

 

 

 

Basic

$2.04

 

 

($1.60

)

 

NM

Diluted

$1.88

 

 

($1.60

)

 

NM

Note: For the nine month periods ended September 30, 2024 and September 30, 2023, Financial Advisory net revenue was $1,235,732 and $896,099, respectively; Asset Management net revenue was $874,841 and $857,212, respectively; Corporate net revenue (loss) was $124,395 and ($43,843), respectively.

CONDENSED CONSOLIDATED

STATEMENT OF FINANCIAL CONDITION

(U.S. GAAP - unaudited)

 

 

As of

 

September 30,

 

December 31,

($ in thousands)

2024

 

2023

 

 

 

 

ASSETS

 

 

 

 

Cash and cash equivalents

$1,165,718

 

$971,316

Deposits with banks and short-term investments

313,023

 

219,576

Restricted cash

34,998

 

34,091

Receivables

682,027

 

762,319

Investments

688,411

 

701,964

Property

158,440

 

232,516

Operating lease right-of-use assets

450,462

 

407,213

Goodwill and other intangible assets

394,575

 

394,928

Deferred tax assets

526,800

 

497,340

Other assets

405,550

 

414,518

 

 

 

 

Total Assets

$4,820,004

 

$4,635,781

 

 

 

 

LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS & STOCKHOLDERS' EQUITY

 

 

 

 

Liabilities

 

 

 

 

 

 

 

Deposits and other customer payables

$346,834

 

$443,262

Accrued compensation and benefits

633,712

 

781,375

Operating lease liabilities

521,521

 

485,191

Tax receivable agreement obligation

84,137

 

115,087

Senior debt

1,852,843

 

1,690,200

Other liabilities

616,502

 

550,804

Total liabilities

4,055,549

 

4,065,919

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

Redeemable noncontrolling interests

84,467

 

87,675

 

 

 

 

Stockholders' equity

 

 

 

 

 

 

 

Preferred stock, par value $.01 per share

–

 

–

Common stock, par value $.01 per share

1,128

 

1,128

Additional paid-in capital

284,091

 

247,204

Retained earnings

1,437,698

 

1,402,636

Accumulated other comprehensive loss, net of tax

(271,844)

 

(289,950)

Subtotal

1,451,073

 

1,361,018

Common stock held by subsidiaries, at cost

(826,800)

 

(937,259)

Total Lazard, Inc. stockholders' equity

624,273

 

423,759

Noncontrolling interests

55,715

 

58,428

Total stockholders' equity

679,988

 

482,187

 

 

 

 

Total liabilities, redeemable noncontrolling interests and stockholders' equity

$4,820,004

 

$4,635,781

Note: “Property” includes $73 million of property held for sale at December 31, 2023 which was sold in July 2024.

SELECTED SUMMARY FINANCIAL INFORMATION (a)

(Adjusted Basis - Non-GAAP - unaudited)

 

 

Three Months Ended

 

% Change From

 

September 30,

 

June 30,

 

September 30,

 

June 30,

 

September 30,

($ in thousands, except per share data)

2024

 

2024

 

2023

 

2024

 

2023

 

 

 

 

 

 

 

 

 

 

Net Revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Financial Advisory

$368,807

 

$407,936

 

$261,441

 

(10%)

 

41%

Asset Management

271,510

 

265,219

 

262,162

 

2%

 

4%

Corporate

5,597

 

11,487

 

8,014

 

(51%)

 

(30%)

 

 

 

 

 

 

 

 

 

 

Adjusted net revenue

$645,914

 

$684,642

 

$531,617

 

(6%)

 

21%

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted compensation and benefits expense

$426,303

 

$451,864

 

$363,626

 

(6%)

 

17%

Adjusted compensation ratio (b)

66.0%

 

66.0%

 

68.4%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted non-compensation expenses

$138,239

 

$148,612

 

$137,450

 

(7%)

 

1%

Adjusted non-compensation ratio (c)

21.4%

 

21.7%

 

25.9%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted operating income

$81,372

 

$84,166

 

$30,541

 

(3%)

 

NM

Adjusted operating margin (d)

12.6%

 

12.3%

 

5.7%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted net income

$39,706

 

$52,869

 

$10,268

 

(25%)

 

NM

 

 

 

 

 

 

 

 

 

 

Adjusted diluted net income per share

$0.38

 

$0.52

 

$0.10

 

(27%)

 

NM

 

 

 

 

 

 

 

 

 

 

Adjusted diluted weighted average shares (e)

105,514,236

 

102,188,981

 

98,282,239

 

3%

 

7%

 

 

 

 

 

 

 

 

 

 

Adjusted effective tax rate (f)

32.5 %

 

14.0 %

 

8.4 %

 

 

 

 

This presentation includes non-GAAP measures. Our non-GAAP measures are not meant to be considered in isolation or as a substitute for the corresponding U.S. GAAP measures and should be read only in conjunction with our consolidated financial statements prepared in accordance with U.S. GAAP. For a detailed explanation of the adjustments made to the corresponding U.S. GAAP measures, see Reconciliation of U.S. GAAP to Selected Summary Financial Information and Notes to Financial Schedules.

See Notes to Financial Schedules

SELECTED SUMMARY FINANCIAL INFORMATION (a)

(Adjusted Basis - Non-GAAP - unaudited)

 

 

Nine Months Ended

 

September 30,

 

September 30,

 

 

($ in thousands, except per share data)

2024

 

2023

 

% Change

 

 

 

 

 

 

Net Revenue:

 

 

 

 

 

 

 

 

 

 

 

Financial Advisory

$1,223,377

 

$879,469

 

39%

Asset Management

812,663

 

793,865

 

2%

Corporate

41,081

 

5,327

 

NM

 

 

 

 

 

 

Adjusted net revenue

$2,077,121

 

$1,678,661

 

24%

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

Adjusted compensation and benefits expense

$1,370,900

 

$1,186,813

 

16%

Adjusted compensation ratio (b)

66.0%

 

70.7%

 

 

 

 

 

 

 

 

Adjusted non-compensation expenses

$421,144

 

$423,385

 

(1%)

Adjusted non-compensation ratio (c)

20.3%

 

25.2%

 

 

 

 

 

 

 

 

Earnings:

 

 

 

 

 

 

 

 

 

 

 

Adjusted operating income

$285,077

 

$68,463

 

NM

Adjusted operating margin (d)

13.7%

 

4.1%

 

 

 

 

 

 

 

 

Adjusted net income

$159,181

 

$10,012

 

NM

 

 

 

 

 

 

Adjusted diluted net income per share

$1.54

 

$0.10

 

NM

 

 

 

 

 

 

Adjusted diluted weighted average shares (e)

103,078,479

 

96,882,516

 

6%

 

 

 

 

 

 

Adjusted effective tax rate (f)

27.4%

 

3.9%

 

 

This presentation includes non-GAAP measures. Our non-GAAP measures are not meant to be considered in isolation or as a substitute for the corresponding U.S. GAAP measures and should be read only in conjunction with our consolidated financial statements prepared in accordance with U.S. GAAP. For a detailed explanation of the adjustments made to the corresponding U.S. GAAP measures, see Reconciliation of U.S. GAAP to Selected Summary Financial Information and Notes to Financial Schedules.

See Notes to Financial Schedules

ASSETS UNDER MANAGEMENT

(unaudited)

 

 

As of

 

% Change From

 

September 30,

 

June 30,

 

December 31,

 

June 30,

 

December 31,

($ in millions)

2024

 

2024

 

2023

 

2024

 

2023

 

 

 

 

 

 

 

 

 

 

Equity:

 

 

 

 

 

 

 

 

 

Emerging Markets

$29,449

 

$27,044

 

$25,288

 

8.9%

 

16.5%

Global

50,441

 

54,026

 

53,528

 

(6.6%)

 

(5.8%)

Local

54,380

 

52,738

 

52,208

 

3.1%

 

4.2%

Multi-Regional

57,262

 

56,618

 

59,114

 

1.1%

 

(3.1%)

Total Equity

191,532

 

190,426

 

190,138

 

0.6%

 

0.7%

Fixed Income:

 

 

 

 

 

 

 

 

 

Emerging Markets

8,372

 

9,250

 

9,525

 

(9.5%)

 

(12.1%)

Global

12,474

 

11,167

 

10,762

 

11.7%

 

15.9%

Local

5,931

 

5,729

 

6,080

 

3.5%

 

(2.5%)

Multi-Regional

21,156

 

19,965

 

21,740

 

6.0%

 

(2.7%)

Total Fixed Income

47,933

 

46,111

 

48,107

 

4.0%

 

(0.4%)

Alternative Investments

3,011

 

2,897

 

3,330

 

3.9%

 

(9.6%)

Private Wealth Alternative Investments

3,044

 

3,033

 

2,799

 

0.4%

 

8.8%

Private Equity

1,514

 

1,501

 

1,623

 

0.9%

 

(6.7%)

Cash Management

623

 

702

 

654

 

(11.3%)

 

(4.7%)

Total AUM

$247,657

 

$244,670

 

$246,651

 

1.2%

 

0.4%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

September 30,

 

June 30,

 

September 30,

 

September 30,

 

September 30,

 

2024

 

2024

 

2023

 

2024

 

2023

 

 

 

 

 

 

 

 

 

 

AUM - Beginning of Period

$244,670

 

$250,432

 

$239,340

 

$246,651

 

$216,125

 

 

 

 

 

 

 

 

 

 

Net Flows

(12,379)

 

(6,599)

 

(1,994)

 

(25,608)

 

8

Market and foreign exchange

 

 

 

 

 

 

 

 

 

appreciation (depreciation)

15,366

 

837

 

(9,082)

 

26,614

 

12,131

 

 

 

 

 

 

 

 

 

 

AUM - End of Period

$247,657

 

$244,670

 

$228,264

 

$247,657

 

$228,264

 

 

 

 

 

 

 

 

 

 

Average AUM

$245,958

 

$245,302

 

$236,298

 

$246,070

 

$232,817

 

 

 

 

 

 

 

 

 

 

% Change in Average AUM

 

 

0.3%

 

4.1%

 

 

 

5.7%

Note: Average AUM generally represents the average of the monthly ending AUM balances for the period.

RECONCILIATION OF U.S. GAAP TO ADJUSTED RESULTS (a)

(unaudited)

 

 

Three Months Ended

 

Nine Months Ended

 

September 30,

 

June 30,

 

September 30,

 

September 30,

 

September 30,

($ in thousands)

2024

 

2024

 

2023

 

2024

 

2023

 

 

 

 

 

 

 

 

 

 

Net Revenue

Financial Advisory net revenue - U.S. GAAP Basis

$370,917

 

 

$411,308

 

 

$266,048

 

 

$1,235,732

 

 

$896,099

 

Adjustments:

 

 

 

 

 

 

 

 

 

Reimbursable deal costs, provision for credit losses and other (g)

(2,111

)

 

(3,372

)

 

(6,893

)

 

(12,984

)

 

(18,984

)

Interest expense (h)

1

 

 

–

 

 

122

 

 

42

 

 

190

 

Losses associated with cost-saving initiatives (i)

–

 

 

–

 

 

2,164

 

 

587

 

 

2,164

 

 

 

 

 

 

 

 

 

 

 

Adjusted Financial Advisory net revenue

$368,807

 

 

$407,936

 

 

$261,441

 

 

$1,223,377

 

 

$879,469

 

 

 

 

 

 

 

 

 

 

 

Asset Management net revenue - U.S. GAAP Basis

$293,878

 

 

$285,487

 

 

$284,855

 

 

$874,841

 

 

$857,212

 

Adjustments:

 

 

 

 

 

 

 

 

 

Revenue related to noncontrolling interests (j)

(5,170

)

 

(4,054

)

 

(5,711

)

 

(13,321

)

 

(12,940

)

Distribution fees and other (g)

(17,199

)

 

(16,216

)

 

(16,987

)

 

(48,863

)

 

(50,415

)

Interest expense (h)

1

 

 

2

 

 

5

 

 

6

 

 

8

 

 

 

 

 

 

 

 

 

 

 

Adjusted Asset Management net revenue

$271,510

 

 

$265,219

 

 

$262,162

 

 

$812,663

 

 

$793,865

 

 

 

 

 

 

 

 

 

 

 

Corporate net revenue (loss) - U.S. GAAP Basis

$120,071

 

 

($11,446

)

 

($26,985

)

 

$124,395

 

 

($43,843

)

Adjustments:

 

 

 

 

 

 

 

 

 

(Revenue) loss related to noncontrolling interests (j)

(5,943

)

 

(866

)

 

2,816

 

 

(9,815

)

 

(7,015

)

(Gains) losses related to Lazard Fund Interests ("LFI") and other similar arrangements (k)

(16,732

)

 

1,201

 

 

10,598

 

 

(24,904

)

 

(15,530

)

Provision for credit losses (g)

–

 

 

–

 

 

–

 

 

–

 

 

(7,500

)

Interest expense (h)

22,472

 

 

22,598

 

 

19,102

 

 

65,676

 

 

57,603

 

Asset impairment charges

–

 

 

–

 

 

–

 

 

–

 

 

19,129

 

Losses associated with cost-saving initiatives (i)

–

 

 

–

 

 

2,483

 

 

–

 

 

2,483

 

Gain on sale of property (l)

(114,271

)

 

–

 

 

–

 

 

(114,271

)

 

–

 

 

 

 

 

 

 

 

 

 

 

Adjusted Corporate net revenue

$5,597

 

 

$11,487

 

 

$8,014

 

 

$41,081

 

 

$5,327

 

 

 

 

 

 

 

 

 

 

 

Net revenue - U.S. GAAP Basis

$784,866

 

 

$685,349

 

 

$523,918

 

 

$2,234,968

 

 

$1,709,468

 

Adjustments:

 

 

 

 

 

 

 

 

 

Revenue related to noncontrolling interests (j)

(11,113

)

 

(4,920

)

 

(2,895

)

 

(23,136

)

 

(19,955

)

(Gains) losses related to Lazard Fund Interests ("LFI") and other similar arrangements (k)

(16,732

)

 

1,201

 

 

10,598

 

 

(24,904

)

 

(15,530

)

Distribution fees, reimbursable deal costs, provision for credit losses and other (g)

(19,310

)

 

(19,588

)

 

(23,880

)

 

(61,847

)

 

(76,899

)

Interest expense (h)

22,474

 

 

22,600

 

 

19,229

 

 

65,724

 

 

57,801

 

Asset impairment charges

–

 

 

–

 

 

–

 

 

–

 

 

19,129

 

Losses associated with cost-saving initiatives (i)

–

 

 

–

 

 

4,647

 

 

587

 

 

4,647

 

Gain on sale of property (l)

(114,271

)

 

–

 

 

–

 

 

(114,271

)

 

–

 

 

 

 

 

 

 

 

 

 

 

Adjusted net revenue

$645,914

 

 

$684,642

 

 

$531,617

 

 

$2,077,121

 

 

$1,678,661

 

This presentation includes non-GAAP measures. Our non-GAAP measures are not meant to be considered in isolation or as a substitute for the corresponding U.S. GAAP measures and should be read only in conjunction with our consolidated financial statements prepared in accordance with U.S. GAAP. For a detailed explanation of the adjustments made to the corresponding U.S. GAAP measures, see Notes to Financial Schedules.

See Notes to Financial Schedules

RECONCILIATION OF U.S. GAAP TO ADJUSTED RESULTS (a)

(unaudited)

 

 

Three Months Ended

 

Nine Months Ended

 

September 30,

 

June 30,

 

September 30,

 

September 30,

 

September 30,

($ in thousands, except per share data)

2024

 

2024

 

2023

 

2024

 

2023

 

 

 

 

 

 

 

 

 

 

Compensation and Benefits Expense

Compensation and benefits expense - U.S. GAAP Basis

$465,405

 

 

$452,560

 

 

$364,605

 

 

$1,468,789

 

 

$1,386,803

 

Adjustments:

 

 

 

 

 

 

 

 

 

Compensation and benefits expense related to noncontrolling interests (j)

(2,249

)

 

(1,897

)

 

(2,636

)

 

(6,254

)

 

(7,497

)

(Charges) credits pertaining to LFI and other similar arrangements (m)

(16,732

)

 

1,201

 

 

10,598

 

 

(24,904

)

 

(15,530

)

Expenses associated with cost-saving initiatives

–

 

 

–

 

 

(8,941

)

 

(46,610

)

 

(166,289

)

Expenses associated with sale of property (n)

(20,121

)

 

–

 

 

–

 

 

(20,121

)

 

–

 

Expenses associated with senior management transition (o)

–

 

 

–

 

 

–

 

 

–

 

 

(10,674

)

 

 

 

 

 

 

 

 

 

 

Adjusted compensation and benefits expense

$426,303

 

 

$451,864

 

 

$363,626

 

 

$1,370,900

 

 

$1,186,813

 

 

 

 

 

 

 

 

 

 

 

Non-Compensation Expenses

Non-compensation expenses - U.S. GAAP Basis

$158,274

 

 

$169,149

 

 

$164,170

 

 

$486,791

 

 

$514,954

 

Adjustments:

 

 

 

 

 

 

 

 

 

Non-compensation expenses related to noncontrolling interests (j)

(672

)

 

(881

)

 

(625

)

 

(2,079

)

 

(2,215

)

Distribution fees, reimbursable deal costs, provision for credit losses and other (g)

(19,310

)

 

(19,588

)

 

(23,880

)

 

(61,847

)

 

(76,899

)

Amortization and other acquisition-related costs

(53

)

 

(68

)

 

(96

)

 

(189

)

 

(239

)

Expenses associated with cost-saving initiatives

–

 

 

–

 

 

(2,119

)

 

(1,532

)

 

(12,216

)

 

 

 

 

 

 

 

 

 

 

Adjusted non-compensation expenses

$138,239

 

 

$148,612

 

 

$137,450

 

 

$421,144

 

 

$423,385

 

 

 

 

 

 

 

 

 

 

 

Operating Income (Loss)

Operating income (loss) - U.S. GAAP Basis

$161,187

 

 

$63,640

 

 

($4,857

)

 

$279,388

 

 

($151,854

)

Adjustments:

 

 

 

 

 

 

 

 

 

Operating income (loss) related to noncontrolling interests (j)

(8,192

)

 

(2,142

)

 

366

 

 

(14,803

)

 

(10,243

)

Interest expense (h)

22,474

 

 

22,600

 

 

19,229

 

 

65,724

 

 

57,801

 

Amortization and other acquisition-related costs

53

 

 

68

 

 

96

 

 

189

 

 

239

 

Asset impairment charges

–

 

 

–

 

 

–

 

 

–

 

 

19,129

 

Losses associated with cost-saving initiatives (i)

–

 

 

–

 

 

4,647

 

 

587

 

 

4,647

 

Expenses associated with cost-saving initiatives

–

 

 

–

 

 

11,060

 

 

48,142

 

 

178,505

 

Gain on sale of property (l)

(114,271

)

 

–

 

 

–

 

 

(114,271

)

 

–

 

Expenses associated with sale of property (n)

20,121

 

 

–

 

 

–

 

 

20,121

 

 

–

 

Expenses associated with senior management transition (o)

–

 

 

–

 

 

–

 

 

–

 

 

10,674

 

Benefit pursuant to tax receivable agreement obligation ("TRA") (p)

–

 

 

–

 

 

–

 

 

–

 

 

(40,435

)

 

 

 

 

 

 

 

 

 

 

Adjusted operating income

$81,372

 

 

$84,166

 

 

$30,541

 

 

$285,077

 

 

$68,463

 

 

 

 

 

 

 

 

 

 

 

Provision (Benefit) for Income Taxes

Provision (benefit) for income taxes - U.S. GAAP Basis

$45,052

 

 

$11,587

 

 

($11,631

)

 

$70,976

 

 

($23,053

)

Adjustment:

 

 

 

 

 

 

 

 

 

Tax effect of adjustments

(25,915

)

 

(2,960

)

 

12,578

 

 

(10,997

)

 

23,462

 

 

 

 

 

 

 

 

 

 

 

Adjusted provision for income taxes

$19,137

 

 

$8,627

 

 

$947

 

 

$59,979

 

 

$409

 

 

 

 

 

 

 

 

 

 

 

Net Income (Loss) attributable to Lazard, Inc.

Net income (loss) attributable to Lazard, Inc. - U.S. GAAP Basis

$107,938

 

 

$49,909

 

 

$7,139

 

 

$193,602

 

 

($139,046

)

Adjustments:

 

 

 

 

 

 

 

 

 

Asset impairment charges

–

 

 

–

 

 

–

 

 

–

 

 

19,129

 

Losses associated with cost-saving initiatives (i)

–

 

 

–

 

 

4,647

 

 

587

 

 

4,647

 

Expenses associated with cost-saving initiatives

–

 

 

–

 

 

11,060

 

 

48,142

 

 

178,505

 

Gain on sale of property (l)

(114,271

)

 

–

 

 

–

 

 

(114,271

)

 

–

 

Expenses associated with sale of property (n)

20,121

 

 

–

 

 

–

 

 

20,121

 

 

–

 

Expenses associated with senior management transition (o)

–

 

 

–

 

 

–

 

 

–

 

 

10,674

 

Benefit pursuant to tax receivable agreement obligation ("TRA") (p)

–

 

 

–

 

 

–

 

 

–

 

 

(40,435

)

Noncontrolling interests effect of adjustments

3

 

 

–

 

 

–

 

 

3

 

 

–

 

Tax effect of adjustments

25,915

 

 

2,960

 

 

(12,578

)

 

10,997

 

 

(23,462

)

 

 

 

 

 

 

 

 

 

 

Adjusted net income

$39,706

 

 

$52,869

 

 

$10,268

 

 

$159,181

 

 

$10,012

 

 

Diluted Weighted Average Shares Outstanding

Diluted Weighted Average Shares Outstanding - U.S. GAAP Basis

103,475,234

 

 

100,627,867

 

 

94,309,224

 

 

101,151,624

 

 

88,582,468

 

Adjustment: participating securities including profits interest participation rights and other

2,039,002

 

 

1,561,114

 

 

3,973,015

 

 

1,926,855

 

 

8,300,048

 

Adjusted Diluted Weighted Average Shares Outstanding (e)

105,514,236

 

 

102,188,981

 

 

98,282,239

 

 

103,078,479

 

 

96,882,516

 

 

 

 

 

 

 

 

 

 

 

Diluted net income (loss) per share:

 

 

 

 

 

 

 

 

 

U.S. GAAP Basis

$1.02

 

 

$0.49

 

 

$0.06

 

 

$1.88

 

 

($1.60

)

Diluted net income (loss) effect of adjustments

(0.64

)

 

0.03

 

 

0.04

 

 

(0.34

)

 

1.70

 

Adjusted Basis

$0.38

 

 

$0.52

 

 

$0.10

 

 

$1.54

 

 

$0.10

 

This presentation includes non-GAAP measures. Our non-GAAP measures are not meant to be considered in isolation or as a substitute for the corresponding U.S. GAAP measures and should be read only in conjunction with our consolidated financial statements prepared in accordance with U.S. GAAP. For a detailed explanation of the adjustments made to the corresponding U.S. GAAP measures, see Notes to Financial Schedules.

See Notes to Financial Schedules

RECONCILIATION OF NON-COMPENSATION EXPENSES U.S. GAAP TO ADJUSTED (a)

(unaudited)

 

 

Three Months Ended

 

Nine Months Ended

 

September 30,

 

June 30,

 

September 30,

 

September 30,

 

September 30,

($ in thousands)

2024

 

2024

 

2023

 

2024

 

2023

 

 

 

 

 

 

 

 

 

 

Non-compensation expenses - U.S. GAAP Basis:

 

 

 

 

 

 

 

 

 

Occupancy and equipment

$34,249

 

 

$32,031

 

 

$33,108

 

 

$99,137

 

 

$97,681

 

Marketing and business development

21,782

 

 

25,493

 

 

20,754

 

 

70,874

 

 

72,098

 

Technology and information services

44,628

 

 

46,406

 

 

46,897

 

 

135,951

 

 

142,307

 

Professional services

19,541

 

 

23,734

 

 

20,451

 

 

63,155

 

 

66,179

 

Fund administration and outsourced services

27,996

 

 

27,114

 

 

27,884

 

 

81,250

 

 

83,428

 

Amortization and other acquisition-related costs

53

 

 

68

 

 

96

 

 

189

 

 

239

 

Other

10,025

 

 

14,303

 

 

14,980

 

 

36,235

 

 

53,022

 

Non-compensation expenses - U.S. GAAP Basis

$158,274

 

 

$169,149

 

 

$164,170

 

 

$486,791

 

 

$514,954

 

 

 

 

 

 

 

 

 

 

 

Non-compensation expenses - Adjustments:

 

 

 

 

 

 

 

 

 

Occupancy and equipment (j)

($88

)

 

($95

)

 

($762

)

 

($1,756

)

 

($1,701

)

Marketing and business development (g) (j)

(3,064

)

 

(2,944

)

 

(3,659

)

 

(8,087

)

 

(11,551

)

Technology and information services (g) (j)

(66

)

 

(49

)

 

(612

)

 

(150

)

 

(8,121

)

Professional services (g) (j)

(1,270

)

 

(1,085

)

 

(1,711

)

 

(3,228

)

 

(5,102

)

Fund administration and outsourced services (g) (j)

(16,660

)

 

(15,588

)

 

(16,432

)

 

(47,283

)

 

(48,693

)

Amortization and other acquisition-related costs

(53

)

 

(68

)

 

(96

)

 

(189

)

 

(239

)

Other (g) (j)

1,166

 

 

(708

)

 

(3,448

)

 

(4,954

)

 

(16,162

)

Subtotal non-compensation expenses adjustments

($20,035

)

 

($20,537

)

 

($26,720

)

 

($65,647

)

 

($91,569

)

 

 

 

 

 

 

 

 

 

 

Adjusted non-compensation expenses:

 

 

 

 

 

 

 

 

 

Occupancy and equipment

$34,161

 

 

$31,936

 

 

$32,346

 

 

$97,381

 

 

$95,980

 

Marketing and business development

18,718

 

 

22,549

 

 

17,095

 

 

62,787

 

 

60,547

 

Technology and information services

44,562

 

 

46,357

 

 

46,285

 

 

135,801

 

 

134,186

 

Professional services

18,271

 

 

22,649

 

 

18,740

 

 

59,927

 

 

61,077

 

Fund administration and outsourced services

11,336

 

 

11,526

 

 

11,452

 

 

33,967

 

 

34,735

 

Amortization and other acquisition-related costs

–

 

 

–

 

 

–

 

 

–

 

 

–

 

Other

11,191

 

 

13,595

 

 

11,532

 

 

31,281

 

 

36,860

 

Adjusted non-compensation expenses

$138,239

 

 

$148,612

 

 

$137,450

 

 

$421,144

 

 

$423,385

 

This presentation includes non-GAAP measures. Our non-GAAP measures are not meant to be considered in isolation or as a substitute for the corresponding U.S. GAAP measures and should be read only in conjunction with our consolidated financial statements prepared in accordance with U.S. GAAP. For a detailed explanation of the adjustments made to the corresponding U.S. GAAP measures, see Notes to Financial Schedules.

See Notes to Financial Schedules

LAZARD, Inc.

Notes to Financial Schedules

(a)

Selected Summary Financial Information are non-GAAP measures. Lazard believes that presenting results and measures on an adjusted basis in conjunction with U.S. GAAP measures provides a meaningful and useful basis for comparison of its operating results across periods.

Beginning in the first quarter of 2024, Lazard has updated the names of certain non-GAAP measures and metrics. The nomenclature change did not result in any change to the components of our non-GAAP measures and metrics compared to prior periods.

 

 

 

 

 

 

 

 

 

 

 

(b)

A non-GAAP measure which represents adjusted compensation and benefits expense as a percentage of adjusted net revenue.

 

 

 

 

 

 

 

 

 

 

 

(c)

A non-GAAP measure which represents adjusted non-compensation expenses as a percentage of adjusted net revenue.

 

 

 

 

 

 

 

 

 

 

 

(d)

A non-GAAP measure which represents adjusted operating income as a percentage of adjusted net revenue.

 

 

 

 

 

 

 

 

 

 

 

(e)

A non-GAAP measure which includes units of the long-term incentive compensation program consisting of profits interest participation rights, which are equity incentive awards that, subject to certain conditions, may be exchanged for shares of our common stock. Certain profits interest participation rights may be excluded from the computation of outstanding stock equivalents for U.S. GAAP net income per share. In addition, this measure includes the dilutive effect of the weighted average number of shares of common stock issuable from share-based compensation programs.

 

 

 

 

 

 

 

 

 

 

 

(f)

A non-GAAP measure which represents the adjusted provision for income taxes as a percentage of adjusted operating income less interest expense, amortization and other acquisition-related costs.

 

 

Three Months Ended

 

Nine Months Ended

 

($ in thousands)

September 30,

 

June 30,

 

September 30,

 

September 30,

 

September 30,

 

 

 

2024

 

2024

 

2023

 

2024

 

2023

 

Adjusted provision for income taxes

$19,137

 

$8,627

 

$947

 

$59,979

 

$409

 

Adjusted operating income less interest expense, amortization and other acquisition-related costs

58,843

 

61,496

 

11,216

 

219,160

 

10,423

 

Adjusted effective tax rate

32.5%

 

14.0%

 

8.4%

 

27.4%

 

3.9%

 

 

 

 

 

 

 

 

 

 

 

(g)

Represents certain distribution, introducer and management fees paid to third parties and reimbursable deal costs, for which an equal amount is excluded from both adjusted net revenue and adjusted non-compensation expenses, respectively, and excludes provision for credit losses, which represents fees and other receivables that are deemed uncollectible.

 

 

 

 

 

 

 

 

 

 

 

(h)

Interest expense, excluding interest expense incurred by Lazard Frères Banque SA ("LFB"), is added back in determining adjusted net revenue because such expense relates to corporate financing activities and is not considered to be a cost directly related to the revenue of our business.

 

 

 

 

 

 

 

 

 

 

 

(i)

Represents losses associated with the closing of certain offices as part of the cost-saving initiatives, including the reclassification of currency translation adjustments to earnings from accumulated other comprehensive loss and transactions related to foreign currency exchange.

 

 

 

 

 

 

 

 

 

 

 

(j)

(Revenue) loss and expenses related to the consolidation of noncontrolling interests are excluded because the Company has no economic interest in such amounts.

 

 

 

 

 

 

 

 

 

 

 

(k)

Represents changes in the fair value of investments held in connection with LFI and other similar deferred compensation arrangements, for which a corresponding equal amount is excluded from compensation and benefits expense.

 

 

 

 

 

 

 

 

 

 

 

(l)

Represents gain on sale of an owned office building.

 

 

 

 

 

 

 

 

 

 

 

(m)

Represents changes in the fair value of the compensation liability recorded in connection with LFI and other similar deferred incentive compensation awards, for which a corresponding equal amount is excluded from adjusted net revenue.

 

 

 

 

 

 

 

 

 

 

 

(n)

Represents statutory profit sharing expenses associated with sale of an owned office building.

 

 

 

 

 

 

 

 

 

 

 

(o)

Represents expenses associated with senior management transition reflecting the departure of certain executive officers.

 

 

 

 

 

 

 

 

 

 

 

(p)

Pursuant to the periodic revaluation of the TRA liability and the assumptions reflected in the estimate, the revaluation had the effect of reducing the estimated liability under the TRA.

 

 

 

 

 

 

 

 

 

 

 

NM

Not meaningful

 

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