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Evercore Reports Second Quarter 2013 Results Quarterly Dividend Of $0.22 Per Share

Expenses in the Institutional Equities business were $9.6 million for the second quarter, a decrease of 12% from the previous quarter, principally reflecting lower compensation consistent with lower levels of revenues earned in the period.

                           
 

Investment Management

 
 
U.S. GAAP
Three Months Ended Six Months Ended

June 30, 2013

March 31, 2013

June 30, 2012

June 30, 2013

June 30, 2012

Net Revenues: (dollars in thousands)
Investment Management Revenues $ 25,738 $ 21,539 $ 20,036 $ 47,277 $ 39,800
Other Revenue, net   (897 )   (1,713 )   (703 )   (2,610 )   (1,454 )
Net Revenues   24,841     19,826     19,333     44,667     38,346  
 
Expenses:
Employee Compensation and Benefits 14,342 14,203 13,536 28,545 26,034
Non-compensation Costs   7,197     7,354     7,185     14,551     14,545  
Total Expenses   21,539     21,557     20,721     43,096     40,579  
 
Operating Income (Loss) $ 3,302   $ (1,731 ) $ (1,388 ) $ 1,571   $ (2,233 )
 
Compensation Ratio 57.7 % 71.6 % 70.0 % 63.9 % 67.9 %
Operating Margin 13.3 % (8.7 %) (7.2 %) 3.5 % (5.8 %)
 
                     
Adjusted Pro Forma
Three Months Ended Six Months Ended

June 30, 2013

     

March 31, 2013

June 30, 2012

June 30, 2013

June 30, 2012

Net Revenues: (dollars in thousands)
Investment Management Revenues $ 26,455 $ 22,083 $ 20,699 $ 48,538 $ 41,087
Other Revenue, net   27     889     206     916     359  
Net Revenues   26,482     22,972     20,905     49,454     41,446  
 
Expenses:
Employee Compensation and Benefits 13,828 13,535 12,962 27,363 24,934
Non-compensation Costs   7,107     7,230     7,014     14,337     14,159  
Total Expenses   20,935     20,765     19,976     41,700     39,093  
 
Operating Income $ 5,547   $ 2,207   $ 929   $ 7,754   $ 2,353  
 
Compensation Ratio 52.2 % 58.9 % 62.0 % 55.3 % 60.2 %
Operating Margin 20.9 % 9.6 % 4.4 % 15.7 % 5.7 %
 
 

For the second quarter, Investment Management reported Net Revenues and Operating Income of $26.5 million and $5.5 million, respectively. Investment Management reported a second quarter Operating Margin of 20.9% . For the six months ended June 30, 2013, Investment Management reported Net Revenues and Operating Income of $49.5 million and $7.8 million, respectively. The year-to-date Operating Margin was 15.7%, compared to 5.7% last year. As of June 30, 2013, Investment Management reported $13.6 billion of AUM, flat from the first quarter.

                             
 

Revenues

 
 
Investment Management Revenue Components
Adjusted Pro Forma
Three Months Ended Six Months Ended

June 30, 2013

March 31, 2013

June 30, 2012

June 30, 2013

June 30, 2012

Investment Advisory and Management Fees (dollars in thousands)
Wealth Management $ 7,214 $ 6,651 $ 4,906 $ 13,865 $ 9,431
Institutional Asset Management (1) 11,166 10,373 12,415 21,539 24,881
Private Equity   3,733   2,191   1,810     5,924   3,545  
Total Investment Advisory and Management Fees   22,113   19,215   19,131     41,328   37,857  
 
Realized and Unrealized Gains (Losses)
Institutional Asset Management 1,544 1,805 1,117 3,349 2,329
Private Equity   2,073   477   (301 )   2,550   (608 )
Total Realized and Unrealized Gains   3,617   2,282   816     5,899   1,721  
 
Equity in Earnings of Affiliates (2)   725   586   752     1,311   1,509  
Investment Management Revenues $ 26,455 $ 22,083 $ 20,699   $ 48,538 $ 41,087  

 

 
 
(1) Management fees from Institutional Asset Management were $11.2 million, $10.4 million and $12.5 million for the three months ended June 30, 2013, March 31, 2013 and June 30, 2012, respectively, and $21.6 million and $25.1 million for the six months ended June 30, 2013 and 2012, respectively, on a U.S. GAAP basis, excluding the reduction of revenues for client-related expenses.
 
(2) Equity in G5, ABS and Pan on a U.S. GAAP basis are reclassified from Investment Management Revenue to Income from Equity Method Investments. The Company’s investment in Pan was consolidated during the first quarter of 2013.
 
 

Investment Advisory and Management Fees of $22.1 million for the quarter ended June 30, 2013 increased compared to the same period a year ago, as higher fees in Wealth Management and Private Equity were partially offset by declines in Institutional Asset Management.

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