Evercore Reports Fourth Quarter and Full Year 2024 Results; Quarterly Dividend of $0.80 Per Share

Evercore Inc. (NYSE:EVR):

Evercore Inc. (NYSE:EVR) today announced its results for the fourth quarter and full year ended December 31, 2024.

LEADERSHIP COMMENTARY

John S. Weinberg, Chairman and Chief Executive Officer, "We are pleased with our performance in 2024, as we continue to intensively cover our clients and broaden our coverage. We begin 2025 with strong momentum and we expect the market to continue to gradually improve throughout the year."

Roger C. Altman, Founder and Senior Chairman, "Evercore just had its second strongest year in terms of revenue and has considerable momentum going into 2025. The breadth and competitiveness of the Firm, at least in my view, has never been stronger."

Evercore's quarterly results may fluctuate significantly due to the timing and amount of transaction fees earned, as well as other factors. Accordingly, financial results in any particular quarter may not be representative of future results over a longer period of time.

Business Segments:

Evercore's business results are categorized into two segments: Investment Banking & Equities and Investment Management. Investment Banking & Equities includes providing advice to clients on mergers, acquisitions, divestitures and other strategic corporate transactions, as well as services related to securities underwriting, private placement services and commissions for agency-based equity trading services and equity research. Investment Management includes Wealth Management and interests in private equity funds which are not managed by the Company, as well as advising third-party investors through affiliates. See pages A-2 to A-8 for further information and reconciliations of these segment results to our U.S. GAAP consolidated results.

Non-GAAP Measures:

Throughout this release certain information is presented on an adjusted basis, which is a non-GAAP measure. Adjusted results begin with information prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"), and then those results are adjusted to exclude certain items and reflect the conversion of certain Evercore LP Units into Class A shares. Evercore believes that the disclosed adjusted measures and any adjustments thereto, when presented in conjunction with comparable U.S. GAAP measures, are useful to investors to compare Evercore's results across several periods and facilitate an understanding of Evercore's operating results. Evercore uses these measures to evaluate its operating performance, as well as the performance of individual employees. These measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with U.S. GAAP.

In the third quarter of 2024, the Company sold its remaining ownership interest in ABS. The gain on the sale has been excluded from Adjusted Net Revenues.

In the third quarter of 2024, the Company agreed to the redemption of its interest in Luminis, such that it no longer has an equity interest in Luminis following the redemption. The Company received no consideration in respect of the redemption. As a result, the Company incurred a loss in the third quarter of 2024 associated with the write-off of the remaining carrying value of its investment, included within Special Charges, Including Business Realignment Costs, as well as the release of cumulative foreign exchange losses, included within Other Revenue, net. These charges in 2024 have been excluded from Adjusted Net Income Attributable to Evercore Inc.

Evercore's Adjusted Diluted Shares Outstanding for the three and twelve months ended December 31, 2024 were higher than U.S. GAAP as a result of the inclusion of certain Evercore LP Units and Unvested Restricted Stock Units.

Further details of these adjustments, as well as an explanation of similar amounts for the three and twelve months ended December 31, 2023 are included in pages A-2 to A-8.

Selected Financial Data – U.S. GAAP Results

The following is a discussion of Evercore's consolidated results on a U.S. GAAP basis. See pages A-5 to A-7 for our business segment results.

Net Revenues

Advisory Fees – Fourth quarter Advisory Fees increased $190.2 million, or 29%, year-over-year, and full year Advisory Fees increased $476.7 million, or 24%, year-over-year, reflecting an increase in revenue earned from large transactions and an increase in the number of advisory fees earned during 2024.

Underwriting Fees – Fourth quarter Underwriting Fees increased $7.3 million, or 38%, year-over-year, and full year Underwriting Fees increased $46.1 million, or 41%, year-over-year, reflecting an increase in the number of transactions we participated in during 2024.

Commissions and Related Revenue – Fourth quarter Commissions and Related Revenue increased $2.1 million, or 4%, year-over-year, and full year Commissions and Related Revenue increased $11.3 million, or 6%, year-over-year, primarily reflecting higher trading commissions and subscription fees.

Asset Management and Administration Fees – Fourth quarter Asset Management and Administration Fees increased $3.9 million, or 23%, year-over-year, and full year Asset Management and Administration Fees increased $12.5 million, or 19%, year-over-year, driven by an increase in fees from Wealth Management clients, as associated AUM increased 13%, primarily from market appreciation.

Other Revenue – Fourth quarter Other Revenue, net, decreased $12.3 million, or 38%, year-over-year, primarily reflecting lower gains on our investment funds portfolio. Full year Other Revenue, net, increased $7.1 million, or 9%, year-over-year, primarily reflecting higher interest income, as well as higher performance of our investment funds portfolio. The investment funds portfolio is used as an economic hedge against our deferred cash compensation program.

Expenses

Employee Compensation and Benefits – Fourth quarter Employee Compensation and Benefits increased $79.5 million, or 14%, year-over-year, reflecting a compensation ratio of 65.6% for the fourth quarter of 2024 versus 71.4% for the prior year period. The increase in Employee Compensation and Benefits compared to the prior year period principally reflects a higher accrual for incentive compensation, higher base salaries and higher compensation expense related to senior new hires. The Compensation Ratio was also impacted by higher net revenues, as described above, during the current year period compared to the prior year period. Full year Employee Compensation and Benefits increased $317.2 million, or 19%, year-over-year, reflecting a full year compensation ratio of 66.3% versus 68.3% for the prior year period. The increase in Employee Compensation and Benefits compared to the prior year period principally reflects a higher accrual for incentive compensation, higher base salaries and higher compensation expense related to senior new hires. The Compensation Ratio was also impacted by higher net revenues, as described above, during the current year period compared to the prior year period. See "Deferred Compensation" for more information.

Non-Compensation Costs – Fourth quarter Non-Compensation Costs increased $16.8 million, or 16%, year-over-year, primarily driven by an increase in professional fees and occupancy and equipment rental expense, primarily related to an increase in office space, as well as an increase in travel and related expenses, largely due to higher levels of business activity and increased headcount. The fourth quarter Non-Compensation ratio of 12.7% decreased from 13.6% for the prior year period. The Non-Compensation Ratio was also impacted by higher net revenues, as described above, during the current year period compared to the prior year period. Full year Non-Compensation Costs increased $64.3 million, or 16%, year-over-year, primarily driven by an increase in professional fees and travel and related expenses, largely due to higher levels of business activity and increased headcount, as well as an increase in communications and information services, principally reflecting higher expenses associated with license fees and research services in 2024. The full year Non-Compensation ratio of 15.8% decreased from 16.8% for the prior year period. The Non-Compensation Ratio was also impacted by higher net revenues, as described above, during the current year period compared to the prior year period.

Special Charges, Including Business Realignment Costs – Full year 2024 Special Charges, Including Business Realignment Costs, relate to the write-off of the remaining carrying value of the Company's investment in Luminis in connection with the redemption of the Company's interest. See page 3 for further information.

Full year 2023 Special Charges, Including Business Realignment Costs, relate to the write-off of non-recoverable assets in connection with the wind-down of the Company's operations in Mexico.

Effective Tax Rate

The fourth quarter effective tax rate was 27.5% versus 23.1% for the prior year period. The full year effective tax rate was 21.6% versus 22.0% for the prior year period. The effective tax rate is principally impacted by an increase in non-deductible expenses, state and local apportionment adjustments and the deduction associated with the appreciation in the Firm's share price upon vesting of employee share-based awards above the original grant price. The full year provision for income taxes for 2024 reflects an additional tax benefit of $35.1 million versus $13.7 million for the prior year period, due to the net impact associated with the appreciation in our share price upon vesting of employee share-based awards above the original grant price.

Selected Financial Data – Adjusted Results

The following is a discussion of Evercore's consolidated results on an Adjusted basis. See pages 3 and A-2 to A-8 for further information and reconciliations of these metrics to our U.S. GAAP results. See pages A-5 to A-7 for our business segment results.

Adjusted Net Revenues

See page 4 for additional business metrics.

Advisory Fees – Fourth quarter adjusted Advisory Fees increased $190.0 million, or 29%, year-over-year, and full year adjusted Advisory Fees increased $477.2 million, or 24%, year-over-year, reflecting an increase in revenue earned from large transactions and an increase in the number of advisory fees earned during 2024.

Underwriting Fees – Fourth quarter Underwriting Fees increased $7.3 million, or 38%, year-over-year, and full year Underwriting Fees increased $46.1 million, or 41%, year-over-year, reflecting an increase in the number of transactions we participated in during 2024.

Commissions and Related Revenue – Fourth quarter Commissions and Related Revenue increased $2.1 million, or 4%, year-over-year, and full year Commissions and Related Revenue increased $11.3 million, or 6%, year-over-year, primarily reflecting higher trading commissions and subscription fees.

Asset Management and Administration Fees – Fourth quarter adjusted Asset Management and Administration Fees increased $3.1 million, or 16%, year-over-year, driven by an increase in fees from Wealth Management clients, as associated AUM increased 13%, primarily from market appreciation. The increase was partially offset by a 46% decrease in equity in earnings of affiliates, reflecting the sale of the remaining portion of our interest in ABS during the third quarter of 2024. Full year adjusted Asset Management and Administration Fees increased $11.6 million, or 16%, year-over-year, driven by an increase in fees from Wealth Management clients, as associated AUM increased 13%, primarily from market appreciation. The increase was partially offset by a 15% decrease in equity in earnings of affiliates, reflecting the sale of the remaining portion of our interest in ABS during the third quarter of 2024.

Other Revenue – Fourth quarter adjusted Other Revenue, net, decreased $12.3 million, or 33%, year-over-year, primarily reflecting lower gains on our investment funds portfolio. Full year adjusted Other Revenue, net, increased $7.2 million, or 7%, year-over-year, primarily reflecting higher interest income, as well as higher performance of our investment funds portfolio. The investment funds portfolio is used as an economic hedge against our deferred cash compensation program.

Adjusted Expenses

Employee Compensation and Benefits – Fourth quarter adjusted Employee Compensation and Benefits increased $79.5 million, or 14%, year-over-year, reflecting an adjusted compensation ratio of 65.2% for the fourth quarter of 2024 versus 70.8% for the prior year period. The increase in adjusted Employee Compensation and Benefits compared to the prior year period principally reflects a higher accrual for incentive compensation, higher base salaries and higher compensation expense related to senior new hires. The adjusted Compensation Ratio was also impacted by higher net revenues, as described above, during the current year period compared to the prior year period. Full year adjusted Employee Compensation and Benefits increased $317.2 million, or 19%, year-over-year, reflecting a full year adjusted compensation ratio of 65.7% versus 67.6% for the prior year period. The increase in adjusted Employee Compensation and Benefits compared to the prior year period principally reflects a higher accrual for incentive compensation, higher base salaries and higher compensation expense related to senior new hires. The adjusted Compensation Ratio was also impacted by higher net revenues, as described above, during the current year period compared to the prior year period. See "Deferred Compensation" for more information.

Non-Compensation Costs – Fourth quarter adjusted Non-Compensation Costs increased $16.8 million, or 16%, year-over-year, primarily driven by an increase in professional fees and occupancy and equipment rental expense, primarily related to an increase in office space, as well as an increase in travel and related expenses, largely due to higher levels of business activity and increased headcount. The fourth quarter adjusted Non-Compensation ratio of 12.6% decreased from 13.5% for the prior year period. The adjusted Non-Compensation Ratio was also impacted by higher net revenues, as described above, during the current year period compared to the prior year period. Full year adjusted Non-Compensation Costs increased $64.3 million, or 16%, year-over-year, primarily driven by an increase in professional fees and travel and related expenses, largely due to higher levels of business activity and increased headcount, as well as an increase in communications and information services, principally reflecting higher expenses associated with license fees and research services in 2024. The full year adjusted Non-Compensation ratio of 15.7% decreased from 16.6% for the prior year period. The adjusted Non-Compensation Ratio was also impacted by higher net revenues, as described above, during the current year period compared to the prior year period.

Adjusted Effective Tax Rate

The fourth quarter adjusted effective tax rate was 27.3% versus 25.3% for the prior year period. The full year adjusted effective tax rate was 21.8% versus 23.4% for the prior year period. The adjusted effective tax rate is principally impacted by an increase in non-deductible expenses, state and local apportionment adjustments and the deduction associated with the appreciation in the Firm's share price upon vesting of employee share-based awards above the original grant price. The full year adjusted provision for income taxes for 2024 reflects an additional tax benefit of $36.6 million versus $14.8 million for the prior year period, due to the net impact associated with the appreciation in our share price upon vesting of employee share-based awards above the original grant price.

Liquidity

The Company continues to maintain a strong balance sheet. As of December 31, 2024, cash and cash equivalents were $873.0 million, investment securities and certificates of deposit were $1.5 billion and current assets exceeded current liabilities by $1.8 billion. Amounts due related to the Notes Payable were $373.9 million at December 31, 2024.

Headcount

As of December 31, 2024 and 2023, the Company employed approximately 2,380 and 2,195 people, respectively, worldwide.

As of December 31, 2024 and 2023, the Company employed 184⁽¹⁾ and 174⁽²⁾ total Investment Banking & Equities Senior Managing Directors, respectively, of which 144⁽¹⁾ and 136⁽²⁾, respectively, were Investment Banking Senior Managing Directors.

Deferred Compensation

During 2024, the Company granted to certain employees 1.8 million unvested restricted stock units ("RSUs") (which were primarily granted in conjunction with the 2023 bonus awards) with a grant date fair value of $336.2 million.

In addition, during 2024, the Company granted $143.2 million of deferred cash awards to certain employees, related to our deferred cash compensation program, principally pursuant to 2023 bonus awards.

The Company recognized compensation expense related to RSUs and our deferred cash compensation program of $114.0 million and $476.2 million for the three and twelve months ended December 31, 2024, respectively, and $103.6 million and $439.1 million for the three and twelve months ended December 31, 2023, respectively.

As of December 31, 2024, the Company had 5.1 million unvested RSUs with an aggregate grant date fair value of $758.3 million. RSUs are expensed over the service period of the award, subject to retirement eligibility, and generally vest over four years.

As of December 31, 2024, the Company expects to pay an aggregate of $394.9 million related to our deferred cash compensation program at various dates through 2028, subject to certain vesting events. Amounts due pursuant to this program are expensed over the service period of the award, subject to retirement eligibility, and are reflected in Accrued Compensation and Benefits, a component of current liabilities.

In addition, from time to time, the Company also grants cash and equity-based performance awards to certain employees, the settlement of which is dependent on the performance criteria being achieved.

Capital Return Transactions

On February 4, 2025, the Board of Directors of Evercore declared a quarterly dividend of $0.80 per share to be paid on March 14, 2025 to common stockholders of record on February 28, 2025.

During the fourth quarter, the Company repurchased 14 thousand shares from employees for the net settlement of stock-based compensation awards at an average price per share of $297.41, and 0.1 million shares at an average price per share of $264.91 in open market transactions pursuant to the Company's share repurchase program. The aggregate 0.1 million shares were acquired at an average price per share of $269.06. During 2024, the Company repurchased 1.0 million shares from employees for the net settlement of stock-based compensation awards at an average price per share of $179.67, and 1.3 million shares at an average price per share of $203.84 in open market transactions pursuant to the Company's share repurchase program. The aggregate 2.3 million shares were acquired at an average price per share of $193.40.

Conference Call

Evercore will host a related conference call beginning at 8:00 a.m. Eastern Time, Wednesday, February 5, 2025, accessible via telephone and webcast. Investors and analysts may participate in the live conference call by dialing (800) 445-7795 (toll-free domestic) or (785) 424-1699 (international); passcode: EVRQ424. Please register at least 10 minutes before the conference call begins.

A live audio webcast of the conference call will be available on the Investor Relations section of Evercore's website at www.evercore.com. The webcast will be archived on Evercore's website for 30 days.

About Evercore

Evercore (NYSE:EVR) is a premier global independent investment banking advisory firm. We are dedicated to helping our clients achieve superior results through trusted independent and innovative advice on matters of strategic significance to boards of directors, management teams and shareholders, including mergers and acquisitions, strategic shareholder advisory, restructurings, and capital structure. Evercore also assists clients in raising public and private capital and delivers equity research and equity sales and agency trading execution, in addition to providing wealth and investment management services to high net worth and institutional investors. Founded in 1995, the Firm is headquartered in New York and maintains offices and affiliate offices in major financial centers in the Americas, Europe, the Middle East and Asia. For more information, please visit www.evercore.com.

Basis of Alternative Financial Statement Presentation

Our Adjusted results are a non-GAAP measure. As discussed further under "Non-GAAP Measures", Evercore believes that the disclosed Adjusted measures and any adjustments thereto, when presented in conjunction with comparable U.S. GAAP measures, are useful to investors to compare Evercore's results across several periods and better reflects how management views its operating results. These measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with U.S. GAAP. A reconciliation of our U.S. GAAP results to Adjusted results is presented in the tables included in the following pages.

Forward-Looking Statements

This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, which reflect our current views with respect to, among other things, Evercore's operations and financial performance. In some cases, you can identify these forward-looking statements by the use of words such as "outlook," "backlog," "believes," "expects," "potential," "probable," "continues," "may," "will," "should," "seeks," "approximately," "predicts," "intends," "plans," "estimates," "anticipates" or the negative version of these words or other comparable words. All statements, other than statements of historical fact, included in this release are forward-looking statements and are based on various underlying assumptions and expectations and are subject to known and unknown risks, uncertainties and assumptions, and may include projections of our future financial performance based on our growth strategies and anticipated trends in Evercore's business. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. Evercore believes these factors include, but are not limited to, those described under "Risk Factors" discussed in Evercore's Annual Report on Form 10-K for the year ended December 31, 2023, subsequent quarterly reports on Form 10-Q, current reports on Form 8-K and Registration Statements. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this release. In addition, new risks and uncertainties emerge from time to time, and it is not possible for Evercore to predict all risks and uncertainties, nor can Evercore 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. Accordingly, you should not rely upon forward-looking statements as a prediction of actual results and Evercore does not assume any responsibility for the accuracy or completeness of any of these forward-looking statements. Evercore undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.

Adjusted Results

Throughout the discussion of Evercore's business and elsewhere in this release, information is presented on an Adjusted basis, which is a non-generally accepted accounting principles ("non-GAAP") measure. Adjusted results begin with information prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"), adjusted to exclude certain items and reflect the conversion of certain Evercore LP Units and Unvested Restricted Stock Units into Class A shares. Evercore believes that the disclosed Adjusted measures and any adjustments thereto, when presented in conjunction with comparable U.S. GAAP measures, are useful to investors to compare Evercore's results across several periods and facilitate an understanding of Evercore's operating results. The Company uses these measures to evaluate its operating performance, as well as the performance of individual employees. These measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with U.S. GAAP. These Adjusted amounts are allocated to the Company's two business segments: Investment Banking & Equities and Investment Management. The differences between the Adjusted and U.S. GAAP results are as follows: