Lazard Inc
For the period ended Jun 30, 2024. Filed Jul 26, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Jul 26, 2024
LAZ$38.31-0.6%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-04-26.
0001628280-24-018661
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-07-26.
0001628280-24-033170
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 268 previous paragraphs and 287 current paragraphs.
198 unchanged; 60 reworded; 23 added; 7 removed; 3 previous and 6 current paragraphs rearranged.
Tables are not compared: 25 previous and 27 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (23)
Current report
The global macroeconomic environment is improving though a high degree of geopolitical uncertainty remains. During the first half of the year, headwinds for activity in our Financial Advisory business have tapered and deal financinghas become more readily available. At the same time, the fundamental drivers of deal activity have continued including innovations driven by technology and generative AI, the energy transition, the biotech revolution, and shifts in supply chains globally. For the first half of the year, the “higher for longer” rate environment led to reduced allocations into most active equity strategies by reinforcing the appeal of money market investments and fixed income products.
Current report
(a)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.
Current report
(b)Adjusted operating income is a non-GAAP measure.
Current report
Compensation and benefits expense decreased $120 million, or 21%, as compared to the 2023 period which included $137 million associated with the cost-saving initiatives.
Current report
Adjusted operating income increased $32 million, or 61%, as compared to the 2023 period, and, as a percentage of adjusted net revenue, was 12.3% for the 2024 period, as compared to 8.4% in the 2023 period.
Current report
Net income attributable to noncontrolling interests decreased $1 million, or 41% as compared to the 2023 period.
Current report
Compensation and benefits expense, which included $47 million associated with the cost-saving initiatives in the 2024 period, decreased $19 million, or 2%, as compared to the 2023 period which included $157 million associated with the cost-saving initiatives.
Current report
Non-compensation expense decreased $22 million, or 6%, as compared to the 2023 period which included $10 million associated with the cost-saving initiatives. Adjusted non-compensation expense decreased $3 million, or 1%, as compared to the 2023 period. The ratio of adjusted non-compensation expense to adjusted net revenue was 19.8% for the 2024 period as compared to 24.9% for the 2023 period.
Current report
The Company reported operating income of $118 million, as compared to an operating loss of $147 million in the 2023 period.
Current report
Adjusted operating income increased $166 million as compared to the 2023 period, and, as a percentage of adjusted net revenue, was 14.2% for the 2024 period, as compared to 3.3% in the 2023 period.
Current report
Net income attributable to noncontrolling interests decreased $4 million, or 38% as compared to the 2023 period.
Current report
Financial Advisory net revenue increased $59 million, or 17%, as compared to the 2023 period, reflecting an increase in the industry-wide value of completed M&A transactions.
Current report
Operating expenses decreased $69 million, or 16%, as compared to the 2023 period which included $82 million associated with the cost-saving initiatives.
Current report
Financial Advisory operating income was $66 million as compared to an operating loss of $138 million in the 2023 period and, as a percentage of net revenue, was 7.6%, as compared to (21.9)% in the 2023 period.
Current report
Asset Management net revenue decreased $3 million, or 1%, as compared to the 2023 period. Management fees and other revenue was $282 million for both the 2024 and the 2023 periods. Incentive fees were $4 million, a decrease of $2 million as compared to $6 million in the 2023 period.
Current report
Operating expenses decreased $34 million, or 13%, as compared to the 2023 period which included $37 million associated with the cost-saving initiatives.
Current report
Operating expenses, which included $12 million associated with the cost-saving initiatives in the 2024 period, decreased $20 million, or 4%, as compared to the 2023 period which included $48 million associated with the cost-saving initiatives.
Current report
Asset Management operating income was $84 million, an increase of $29 million, or 52%, as compared to operating income of $55 million in the 2023 period and, as a percentage of net revenue, was 14.4%, as compared to 9.6% in the 2023 period.
Current report
Net interest expense decreased $1 million, or 6%, as compared to the 2023 period.
Current report
Other revenue decreased $15 million as compared to the 2023 period primarily due to losses in the 2024 period as compared to gains in the 2023 period attributable to investments held in connection with LFI.
Current report
Operating expenses decreased $29 million, or 65%, as compared to the 2023 period which included $28 million associated with the cost-saving initiatives. Results also reflect a decrease in charges pertaining to LFI in the 2024 period as compared to the 2023 period.
Current report
On July 22, 2024, the Company completed the sale of an owned office building for gross proceeds of approximately $193 million, subject to payment of taxes and other expenses. The resulting net proceeds will be used for general corporate purposes.
Current report
In addition, on July 24, 2024, the Board of Directors authorized the repurchase of up to $200 million of additional shares of common stock, which authorization will expire on December 31, 2026, bringing the total share repurchase authorization as of July 24, 2024 to approximately $360 million.
Removed paragraphs (7)
Previous report
The global macroeconomic environment is improving and capital market trends are positive. Market expectations have become more closely aligned with the higher for longer interest rate environment. At the same time, there is a high degree of geopolitical uncertainty that continues to be top of mind for decision-makers. In our Financial Advisory business, we are seeing M&A activity strengthen while financing, valuation, and regulatory headwinds abate. In our Asset Management business, we continue to see investor interest across a range of our actively managed strategies. However, with short term global interest rates rising significantly over the past years, cash and short duration investments are nowaccumulating as investors are showing patience in allocating additional capital into risk assets.
Previous report
(a)Adjusted operating income (loss) is a non-GAAP measure.
Previous report
Compensation and benefits expense increased $101 million, or 22%, as compared to the 2023 period.
Previous report
The Company reported adjusted operating income of $120 million as compared to an adjusted operating loss of $14 million in the 2023 period, and, as a percentage of adjusted net revenue, was 16.0% for the 2024 period, as compared to (2.7)% in the 2023 period.
Previous report
Net income attributable to noncontrolling interests decreased $3 million, or 36% as compared to the 2023 period.
Previous report
Operating expenses increased $14 million, or 5%, as compared to the 2023 period.
Previous report
The Company currently expects that approximately $32 million of such obligation will be paid in the second quarter of 2024.
Reworded paragraphs (60)
Previous wording
The following discussion should be read in conjunction with Lazard’s condensed consolidated financial statements and the related notes included elsewhere in this Quarterly Report on Form 10-Q (the “Form 10-Q”), as well as Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) included in our Annual Report on Form 10-K for the year ended December 31, 2023 (the “Form 10-K”). All references to “2024,” “2023,” “first quarter” or “the period” refer to, as the context requires, the three month periods ended March 31, 2024 and 2023.
Current wording
The following discussion should be read in conjunction with Lazard’s condensed consolidated financial statements and the related notes included elsewhere in this Quarterly Report on Form 10-Q (the “Form 10-Q”), as well as Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) included in our Annual Report on Form 10-K for the year ended December 31, 2023 (the “Form 10-K”). All references to “2024,” “2023,” “second quarter,” “first half” or “the period” refer to, as the context requires, the three month and six month periods ended June 30, 2024 and 2023.
Previous wording
•a decline in general economic conditions or the global or regional financial markets;
Current wording
•adverse general economic conditions or adverse conditions in global or regional financial markets;
Previous wording
We operate in cyclical businesses across multiple geographies, industries and asset classes. In recent years, we have expanded our geographic reach, bolstered our industry expertise and continued to build in growth areas. Companies, government bodies and investors seek independent advice with a geographic perspective, deep understanding of capital structure, informed research and knowledge of global, regional and local economic conditions. We believe that our business model as an independent advisor will continue to create opportunities for us to attract new clients and key personnel.
Current wording
We operate in cyclical businesses across multiple geographies, industries and asset classes. In recent years, we have deepened our sector expertise and enhanced our specialized insights in geopolitical advisory, private equity and capital solutions in our financial advisory business and we have invested in our global investment and distribution platform in our asset management business to further drive performance. Companies, government bodies and investors seek independent advice with a geographic perspective, deep understanding of capital structure, informed research and knowledge of global, regional and local economic conditions. We believe that our business model as an independent advisor will continue to create opportunities for us to attract new clients and key personnel.
Previous wording
•Financial Advisory—M&A announcements are up year-over-year with 2023 being at their lowest levels in a decade. We remained actively engaged with our clients. The global scale and breadth of our Financial Advisory business, with particular strength in both the U.S. and Europe, enables us to advise on a wide range of strategic and restructuring transactions across a variety of industries. Throughout 2024, we could see increased M&A activity occurring alongside greater restructuring activity as rates remain high and debt maturities approach. In addition, we continue to invest in our Financial Advisory business by selectively hiring talented senior professionals in an effort to enhance our capabilities and sector expertise in M&A, capital structure, restructuring, and public and private capital markets.
Current wording
•Financial Advisory—M&A announcements for deals greater than $500 million are up year-over-year with 2023 being at their lowest levels in a decade. We remained actively engaged with our clients. The global scale and breadth of our Financial Advisory business, with particular strength in both the U.S. and Europe, enables us to advise on a wide range of strategic and restructuring transactions across a variety of industries. Throughout 2024, we continue to see increased M&A activity occurring alongside greater restructuring activity as rates remain high and debt maturities approach. In addition, we continue to invest in our Financial Advisory business by selectively hiring talented senior professionals in an effort to enhance our capabilities and sector expertise in M&A, capital structure, restructuring, and public and private capital markets.
Previous wording
The following table sets forth global M&A industry statistics for completed and announced M&A transactions.
Current wording
The following table sets forth global M&A and restructuring industry statistics for completed and announced M&A transactions and completed restructuring transactions.
Previous wording
Global restructuring activity during the first quarter of 2024, one measure of which is the number of corporate defaults, decreased as compared to the first quarter of 2023. The number of defaulting issuers was 34 in the first quarter of 2024 according to Moody’s Investors Service, Inc., as compared to 38 in the first quarter of 2023.
Current wording
Another measure of global restructuring activity is the number of corporate defaults, which decreased during the first half of 2024 as compared to the first half of 2023. The number of defaulting issuers was 72 in the first half of 2024 according to Moody’s Investors Service, Inc., as compared to 86 in the first half of 2023.
Previous wording
To the extent inflation results in rising interest rates and has other effects upon the securities markets or general macroeconomic conditions, it may adversely affect our financial position and results of operations by impacting overall levels of M&A activity, reducing our AUM or net revenue, increasing non-compensation expense, or otherwise.
Current wording
To the extent inflation continues to result in a higher interest rate environment or has other effects upon the securities markets or general macroeconomic conditions, it may adversely affect our financial position and results of operations by impacting overall levels of M&A activity, reducing our AUM or net revenue, increasing non-compensation expense, or otherwise.
Previous wording
The Company conducted firm-wide cost-saving initiatives over the course of 2023 and during the first quarter of 2024. See Note 15 of Notes to Condensed Consolidated Financial Statements.
Current wording
The Company conducted firm-wide cost-saving initiatives over the course of 2023, which were completed during the first quarter of 2024. See Note 15 of Notes to Condensed Consolidated Financial Statements.
Previous wording
Noncontrolling interests primarily consist of (i) amounts related to Edgewater’s management vehicles that the Company is deemed to control but not own, (ii) Lazard Growth Acquisition Corp. I (“LGAC”) interests (see Note 1 of Notes to Condensed Consolidated Financial Statements), (iii) profits interest participation rights and (iv) consolidated VIE interests held by employees. See Notes 12 and 21 of Notes to Condensed Consolidated Financial Statements for information regarding the Company’s noncontrolling interests and consolidated VIEs.
Current wording
Noncontrolling interests primarily consist of (i) amounts related to Edgewater’s management vehicles that the Company is deemed to control but not own, (ii) profits interest participation rights, (iii) consolidated VIE interests held by employees and (iv) Lazard Growth Acquisition Corp. I (“LGAC”) interests. See Notes 12 and 21 of Notes to Condensed Consolidated Financial Statements for information regarding the Company’s noncontrolling interests and consolidated VIEs.
Previous wording
(c)Revenue or loss related to the consolidation of noncontrolling interests is excluded from adjusted net revenue because the Company has no economic interest in such amount.
Current wording
(a)Revenue or loss related to the consolidation of noncontrolling interests is excluded from adjusted net revenue because the Company has no economic interest in such amount.
Previous wording
(d)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.
Current wording
(b)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.
Previous wording
(b)Represents certain distribution, introducer and management fees paid to third parties, reimbursable deal costs and bad debt expenses relating to fees and other receivables that are deemed uncollectible for which an equal amount is excluded for purposes of determining adjusted non-compensation expense.
Current wording
(c)Represents certain distribution, introducer and management fees paid to third parties, reimbursable deal costs and provision for credit losses relating to fees and other receivables that are deemed uncollectible for which an equal amount is excluded for purposes of determining adjusted non-compensation expense.
Previous wording
(a)Interest expense (excluding interest expense incurred by 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.
Current wording
(d)Interest expense (excluding interest expense incurred by 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.
Previous wording
(b)Represents changes in 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.
Current wording
(b)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.
Previous wording
(b)Expenses related to the consolidation of noncontrolling interests are excluded because the Company has no economic interest in such amounts.
Current wording
(a)Expenses related to the consolidation of noncontrolling interests are excluded because the Company has no economic interest in such amounts.
Previous wording
(a)Represents certain distribution, introducer and management fees paid to third parties, reimbursable deal costs and bad debt expenses relating to fees and other receivables that are deemed uncollectible for which an equal amount is included for purposes of determining adjusted net revenue.
Current wording
(b)Represents certain distribution, introducer and management fees paid to third parties, reimbursable deal costs and provision for credit losses relating to fees and other receivables that are deemed uncollectible for which an equal amount is included for purposes of determining adjusted net revenue.
Previous wording
The Company’s quarterly revenue and profits can fluctuate materially depending on the number, size and timing of completed transactions on which it advised, as well as seasonality, the performance of equity markets and other factors. Accordingly, the revenue and profits in any particular quarter may not be indicative of future results. Lazard management believes that annual results are the most meaningful basis for comparison among present, historical and future periods.
Current wording
The Company’s quarterly revenue and profits can fluctuate materially depending on the number, size and timing of completed transactions on which it advised, as well as seasonality, the performance of equity markets and other factors.
Previous wording
The Company reported net income attributable to Lazard of $36 million, as compared to net loss attributable to Lazard of $22 million in the 2023 period.
Current wording
The Company reported net income attributable to Lazard of $50 million, as compared to net loss attributable to Lazard of $124 million in the 2023 period.
Previous wording
Adjusted compensation and benefits expense (which excludes certain items and which we believe allows for improved comparability between periods, as described above) was $493 million, an increase of $94 million, or 23%, as compared to $399 million in the 2023 period. The ratio of adjusted compensation and benefits expense to adjusted net revenue was 66.0% for the 2024 period, as compared to 75.7% for the 2023 period.
Current wording
Adjusted compensation and benefits expense (which excludes certain items and which we believe allows for improved comparability between periods, as described above) was $452 million, an increase of $28 million, or 7%, as compared to $424 million in the 2023 period. The ratio of adjusted compensation and benefits expense to adjusted net revenue was 66.0% for the 2024 period, as compared to 68.4% for the 2023 period.
Previous wording
Non-compensation expense decreased $10 million, or 6%, as compared to the 2023 period reflecting lower professional services and other expenses. Adjusted non-compensation expense decreased $8 million, or 6%, as compared to the 2023 period. The ratio of adjusted non-compensation expense to adjusted net revenue was 18.0% for the 2024 period, as compared to 27.0% for the 2023 period.
Current wording
Non-compensation expense decreased $12 million, or 7%, as compared to the 2023 period which included $10 million associated with the cost-saving initiatives. Adjusted non-compensation expense increased $5 million, or 3%, as compared to the 2023 period primarily reflecting higher professional services and technology expenses. The ratio of adjusted non-compensation expense to adjusted net revenue was 21.7% for the 2024 period, as compared to 23.2% for the 2023 period.
Previous wording
The Company reported operating income of $55 million, as compared to an operating loss of $37 million in the 2023 period.
Current wording
The Company reported operating income of $64 million, as compared to an operating loss of $110 million in the 2023 period.
Previous wording
The provision for income taxes reflects an effective tax rate of 26.3%, as compared to 58.8% for the 2023 period. The change in the effective tax rate principally relates to changes in the geographic mix of earnings inclusive of losses without tax benefits in 2023 and the impact of discrete items.
Current wording
The provision for income taxes reflects an effective tax rate of 18.2%, as compared to (9.4)% for the 2023 period. The change in the effective tax rate principally relates to changes in the geographic mix of earnings inclusive of losses without tax benefits in 2023 and the impact of discrete items primarily relating to a favorable court decision in a longstanding tax matter during the second quarter of 2024.
Previous wording
Net revenue increased $222 million, or 41%, with adjusted net revenue increasing $220 million, or 42%, as compared to the 2023 period. Fee revenue from investment banking and other advisory activities increased $176 million, or 63%, as compared to the 2023 period. Asset management fees, including incentive fees, increased $15 million, or 6%, as compared to the 2023 period. In the aggregate, interest income, other revenue and interest expense increased $31 million as compared to the 2023 period, the majority of which is recorded in the Corporate segment.
Current wording
Net revenue increased $265 million, or 22%, with adjusted net revenue increasing $284 million, or 25%, as compared to the 2023 period. Fee revenue from investment banking and other advisory activities increased $234 million, or 37%, as compared to the 2023 period. Asset management fees, including incentive fees, increased $12 million, or 2%, as compared to the 2023 period. In the aggregate, interest income, other revenue and interest expense increased $19 million, as compared to the 2023 period, the majority of which is recorded in the Corporate segment.
Previous wording
The Financial Advisory operating income was $25 million as compared to an operating loss of $51 million in the 2023 period and, as a percentage of net revenue, was 5.6%, as compared to (18.4)% in the 2023 period.
Current wording
Financial Advisory operating income was $40 million as compared to an operating loss of $87 million in the 2023 period and, as a percentage of net revenue, was 9.8%, as compared to (24.7)% in the 2023 period.
Previous wording
Financial Advisory net revenue increased $176 million, or 63%, as compared to the 2023 period. The increase in Financial Advisory net revenue was primarily driven by increased number of completed M&A transactions with values greater than $500 million as compared to the 2023 period, despite a decline in industry-wide completed M&A transactions.
Current wording
Financial Advisory net revenue increased $235 million, or 37%, as compared to the 2023 period. The increase in Financial Advisory net revenue was primarily driven by increased number of completed M&A transactions with values greater than $500 million as compared to the 2023 period, reflecting an increase in industry-wide completed M&A transactions.
Previous wording
Operating expenses increased $99 million, or 30%, as compared to the 2023 period primarily due to increased compensation and benefits expense associated with increased adjusted net revenue.
Current wording
Operating expenses increased $31 million, or 4%, as compared to the 2023 period primarily due to increased compensation and benefits expense associated with increased adjusted net revenue. In addition, operating expenses in the 2024 and 2023 periods include $33 million and $91 million, respectively, associated with the cost-saving initiatives.
Previous wording
Total AUM at March 31, 2024 was $250 billion, an increase of $3 billion, or 2%, as compared to total AUM of $247 billion at December 31, 2023 due to market appreciation partially offset by net outflows and foreign exchange depreciation. Average AUM for the first quarter of 2024 increased 9% as compared to the first quarter of 2023 and increased 6% as compared to the fourth quarter of 2023.
Current wording
Total AUM at June 30, 2024 was $245 billion, a decrease of $2 billion, or 1%, as compared to total AUM of $247 billion at December 31, 2023 due to net outflows and foreign exchange depreciation partially offset by market appreciation. Average AUM for the three month period ended June 30, 2024 increased 4% as compared to the three month period ended June 30, 2023 and increased 6% as compared to the six month period ended June 30, 2023.
Previous wording
The following is a summary of changes in AUM by asset class for the three month periods ended March 31, 2024 and 2023:
Current wording
The following is a summary of changes in AUM by asset class for the three month and six month periods ended June 30, 2024 and 2023:
Previous wording
Average AUM for the three month periods ended March 31, 2024 and 2023 for each significant asset class is set forth below. Average AUM generally represents the average of the monthly ending AUM balances for the period.
Current wording
Average AUM for the three month and six month periods ended June 30, 2024 and 2023 for each significant asset class is set forth below. Average AUM generally represents the average of the monthly ending AUM balances for the period.
Previous wording
Asset Management operating income was $34 million, a decrease of $2 million, or 6%, as compared to operating income of $36 million in the 2023 period and, as a percentage of net revenue, was 11.4%, as compared to 12.7% in the 2023 period.
Current wording
Asset Management operating income was $50 million, an increase of $31 million, or 162%, as compared to operating income of $19 million in the 2023 period and, as a percentage of net revenue, was 17.5%, as compared to 6.6% in the 2023 period.
Previous wording
Asset Management net revenue increased $11 million, or 4%, as compared to the 2023 period. Management fees and other revenue was $287 million, an increase of $8 million, or 3%, as compared to $279 million in the 2023 period. Incentive fees were $9 million, an increase of $4 million as compared to $5 million in the 2023 period.
Current wording
Asset Management net revenue increased $9 million, or 2%, as compared to the 2023 period. Management fees and other revenue was $568 million, an increase of $7 million, or 1%, as compared to $561 million in the 2023 period. Incentive fees were $13 million, an increase of $2 million as compared to $11 million in the 2023 period.
Previous wording
Net interest expense increased $2 million, or 15%, as compared to the 2023 period.
Current wording
Net interest expense increased $1 million, or 3%, as compared to the 2023 period.
Previous wording
Other revenue (loss) was positively impacted by investment gains in the 2024 period, as compared to losses incurred from the impairment of equity method investments and the liquidation of LGAC in the 2023 period.
Current wording
Other revenue increased $22 million as compared to the 2023 period. The 2023 period included losses from the impairment of equity method investments and the liquidation of LGAC which did not recur. Additionally, there were lower gains in the 2024 period as compared to the 2023 period attributable to investments held in connection with LFI.
Previous wording
Operating expenses excluding the benefit pursuant to TRA, decreased $23 million as compared to the 2023 period, reflecting lower professional services and other expenses.
Current wording
Operating expenses excluding the benefit pursuant to TRA, decreased $52 million, or 59%, as compared to the 2023 period reflecting $28 million associated with the cost-saving initiatives in the 2023 period and a decrease in charges pertaining to LFI in the 2024 period.
Previous wording
M&A and other advisory and Asset Management fees are generally collected within 60 days of billing, while Restructuring fee collections may extend beyond 60 days, particularly those that involve bankruptcies with court-ordered holdbacks. Fees from our Private Capital Advisory activities are generally collected over a four-year period from billing and typically include an interest component.
Current wording
The Company’s cash flows are influenced primarily by the timing of the receipt of Financial Advisory and Asset Management fees, the timing of distributions to shareholders, payments of incentive compensation to managing directors and employees and purchases of common stock. M&A and other advisory and Asset Management fees are generally collected within 60 days of billing, while Restructuring fee collections may extend beyond 60 days, particularly those that involve bankruptcies with court-ordered holdbacks. Fees from our Private Capital Advisory activities are generally collected over a four-year period from billing and typically include an interest component.
Previous wording
(c)Consists primarily of purchases of shares of common stock, tax withholdings related to the settlement of vested RSUs, vested RSAs and vested PRSUs, common stock dividends, changes in customer deposits, distributions to noncontrolling interest holders, activity related to borrowings (including in 2024, the issuance of the 2031 Notes and the partial redemption of the 2025 Notes), distributions to redeemable noncontrolling interests associated with LGAC's redemption of all its outstanding Class A ordinary shares in 2023.
Current wording
(c)Consists primarily of purchases of shares of common stock, tax withholdings related to the settlement of vested RSUs and vested PRSUs, common stock dividends, changes in customer deposits, distributions to noncontrolling interest holders, activity related to borrowings (including in 2024, the issuance of the 2031 Notes and the partial redemption of the 2025 Notes), distributions to redeemable noncontrolling interests associated with LGAC's redemption of all its outstanding Class A ordinary shares in 2023.
Previous wording
Liquidity is significantly impacted by cash payments for incentive compensation, a significant portion of which are made during the first three months of the year. As a consequence, cash on hand generally declines in the beginning of the year and gradually builds over the remainder of the year. We also pay certain tax advances during the year on behalf of certain managing directors, which serve to reduce their respective incentive compensation payments. Additionally, we made payments in the first quarter of 2024 relating to severance and other employee termination costs associated with the cost-saving initiatives. (See Note 15 of Notes to Condensed Consolidated Financial Statements). Also see “Senior Debt” below for senior debt refinancing in the first quarter of 2024.
Current wording
Liquidity is significantly impacted by cash payments for incentive compensation, a significant portion of which are made during the first three months of the year. As a consequence, cash on hand generally declines in the beginning of the year and gradually builds over the remainder of the year. We also make payments during the year on behalf of certain managing directors for their estimated taxes, which serve to reduce their respective incentive compensation payments. Additionally, we made payments in the first half of 2024 relating to severance and other employee termination costs associated with the cost-saving initiatives. (See Note 15 of Notes to Condensed Consolidated Financial Statements). Also see “Senior Debt” below for senior debt refinancing in the first quarter of 2024.
Previous wording
We regularly monitor our liquidity position, including cash levels, lease obligations, investments, credit lines, principal investment commitments, interest and principal payments on debt, capital expenditures, dividend payments, purchases of shares of common stock, compensation and matters relating to liquidity and to compliance with regulatory net capital requirements. At March 31, 2024, Lazard had approximately $923 million of cash and cash equivalents, including approximately $427 million held at Lazard’s operations outside the U.S. Lazard provides for income taxes on substantially all of its foreign earnings. We expect that no material amount of additional taxes would be recognized upon receipt of dividends or distributions of such earnings from our foreign operations.
Current wording
We regularly monitor our liquidity position, including cash levels, lease obligations, investments, credit lines, principal investment commitments, interest and principal payments on debt, capital expenditures, dividend payments, purchases of shares of common stock, compensation and matters relating to liquidity and to compliance with regulatory net capital requirements. At June 30, 2024, Lazard had approximately $848 million of cash and cash equivalents, including approximately $434 million held at Lazard’s operations outside the U.S. Lazard provides for income taxes on substantially all of its foreign earnings. We expect that no material amount of additional taxes would be recognized upon receipt of dividends or distributions of such earnings from our foreign operations.
Previous wording
As of March 31, 2024, the Company’s remaining lease obligations were $62 million for 2024 (April 1 through December 31), $139 million from 2025 through 2026, $124 million from 2027 through 2028 and $222 million through 2034.
Current wording
As of June 30, 2024, the Company’s remaining lease obligations were $41 million for 2024 (July 1 through December 31), $140 million from 2025 through 2026, $138 million from 2027 through 2028 and $325 million from 2029 through 2039.
Previous wording
The Second Amended and Restated Credit Agreement includes financial covenants that require that Lazard Group not permit (i) its Consolidated Leverage Ratio (as defined in the Second Amended and Restated Credit Agreement) for the 12-month period ending on the last day of any fiscal quarter to be greater than 3.25 to 1.00, provided that the Consolidated Leverage Ratio may be greater than 3.25 to 1.00 for four (consecutive or nonconsecutive) quarters so long as it is not greater than 3.50 to 1.00 on the last day of any such quarter, or (ii) its Consolidated Interest Coverage Ratio (as defined in the Second Amended and Restated Credit Agreement) for the 12-month period ending on the last day of any fiscal quarter to be less than 3.00 to 1.00. For the 12-month period ended March 31, 2024, Lazard Group was in compliance with such ratios. In any event, no amounts were outstanding under the Second Amended and Restated Credit Agreement as of March 31, 2024.
Current wording
The Second Amended and Restated Credit Agreement includes financial covenants that require that Lazard Group not permit (i) its Consolidated Leverage Ratio (as defined in the Second Amended and Restated Credit Agreement) for the 12-month period ending on the last day of any fiscal quarter to be greater than 3.25 to 1.00, provided that the Consolidated Leverage Ratio may be greater than 3.25 to 1.00 for four (consecutive or nonconsecutive) quarters so long as it is not greater than 3.50 to 1.00 on the last day of any such quarter, or (ii) its Consolidated Interest Coverage Ratio (as defined in the Second Amended and Restated Credit Agreement) for the 12-month period ending on the last day of any fiscal quarter to be less than 3.00 to 1.00. No amounts were outstanding under the Second Amended and Restated Credit Agreement as of June 30, 2024.
Showing the first 40 of 60 pairs. Open the source sections for the rest.
Rearranged current paragraphs (6)
Current report — wording carried from elsewhere
Accordingly, the revenue and profits in any particular quarter may not be indicative of future results. Lazard management believes that annual results are the most meaningful basis for comparison among present, historical and future periods.
Current report — wording carried from elsewhere
Net revenue increased $42 million, or 7%, with adjusted net revenue increasing $65 million, or 10%, as compared to the 2023 period. Fee revenue from investment banking and other advisory activities increased $59 million, or 17%, as compared to the 2023 period. Asset management fees, including incentive fees, decreased $4 million, or 1%, as compared to the 2023 period. In the aggregate, interest income, other revenue and interest expense decreased $13 million as compared to the 2023 period, the majority of which is recorded in the Corporate segment.
Current report — wording carried from elsewhere
The Company reported net income attributable to Lazard of $86 million, as compared to net loss attributable to Lazard of $146 million in the 2023 period.
Current report — wording carried from elsewhere
Adjusted compensation and benefits expense (which excludes certain items and which we believe allows for improved comparability between periods, as described above) was $945 million, an increase of $121 million, or 15%, as compared to $823 million in the 2023 period. The ratio of adjusted compensation and benefits expense to adjusted net revenue was 66.0% for the 2024 period, as compared to 71.8% for the 2023 period.
Current report — wording carried from elsewhere
The provision for income taxes reflects an effective tax rate of 21.9%, as compared to 7.8% for the 2023 period. The change in the effective tax rate principally relates to changes in the geographic mix of earnings inclusive of losses without tax benefits in 2023 and the impact of discrete items primarily relating to a favorable court decision in a longstanding tax matter during the second quarter of 2024.
Current report — wording carried from elsewhere
Net flows were primarily driven by outflows across the Global, Local and Multi-Regional platforms within the Equity asset class.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
The Company’s cash flows are influenced primarily by the timing of the receipt of Financial Advisory and Asset Management fees, the timing of distributions to shareholders, payments of incentive compensation to managing directors and employees and purchases of common stock.
Previous report — wording carried elsewhere
Estimates—Revenue Recognition” above and Note 4 of Notes to Condensed Consolidated Financial Statements for additional information regarding receivables.
Previous report — wording carried elsewhere
“Cybersecurity” in our Form 10-K for more information on the Company’s processes to identify, assess and manage cybersecurity risks.