Perella Weinberg Partners

Good morning and welcome to the Perrella Weinberg Partners Second Quarter 2023 Earnings Conference Call. During today's discussion, all callers will be placed in a listen-only mode, and following management's prepared remarks, the conference call will be open for questions from the research community. This conference call is being recorded. At this time, I'd like to turn the conference over to Taylor Reinhart, Head of Investor Relations. Please go ahead.

Thank you, Operator, and welcome to our second quarter 2023 earnings call. Joining me today are Andrew Bednar, Chief Executive Officer, and Gary Barancic, Chief Financial Officer. A replay of this call will be available through the investor's page on the company's website approximately two hours following the conclusion of this live broadcast through August 10, 2023. For those who listened to the rebroadcast of this presentation, we remind you that the remarks made herein are as of today, August 3, 2023, and have not been updated subsequent to the initial earnings call. Before we begin, I'd like to note that this call may contain forward-looking PwP's expectations of future financial and business performance and conditions and industry outlook. Forward-looking statements are inherently subject to risks, uncertainties, and assumptions that could cause actual results to differ materially from those discussed in the forward-looking statements and are not guarantees of future events or performance. Please refer to PwP's most recent SEC filings for discussion of certain of these risks and uncertainties. The forward-looking statements are based on our current beliefs and expectations, and the firm undertakes no obligation to update any forward-looking statements. During the call, there will also be a discussion of some metrics, which are non-GAAP financial measures which management believes are relevant in assessing the financial performance of the business. PWP has reconciled these items to the most comparable GATT measures in the press release filed with today's Form 8K, which can be found on the company's website. I will now turn the call over to Andrew Bednar to discuss our results.

Andrew Bednar Thank you, Taylor, and good morning. Today we reported second quarter revenues of $166 million, up 10% from a year ago and up 26% from the prior quarter. Our first half revenues of $297 million were essentially flat year-over-year. This quarter is the first in five where we delivered a year-over-year increase, even as global M&A market volumes continue to decline year-over-year. Our above-market performance speaks to the strength of our brand and our client relationships, the quality and tenacity of our team, and the continued effective positioning of our firm's resources. In the second quarter, our results were driven by strong relative performance in our traditional M&A business with activity spread across our key industries. Our revenue increase reflected more absolute transaction completion, as well as more transactions with larger fees. The market environment remains challenging, but conditions have improved. We see encouraging signs of activity across our business, and we are increasingly optimistic that the trough and activity is behind us. Our key indicator to forward volume, our announced and pending backlog, has steadily increased year over year and year to date. We expect revenue related to this activity will lag as nearly all aspects of transaction timelines continue to be elongated relative to historical norms. Nevertheless, after nearly 18 months of sobering data points, we do see signs of a turning M&A cycle. Our financing and capital solutions business is increasingly active as we see opportunities to place and structure private debt and equity solutions for our clients in what has been a prolonged period of uncertainty of access to capital and increasing cost of capital. Restructuring has continued to gain momentum in the year, both in the U.S. and Europe, with mandates driven by strong liability management activity, including new financings, maturity extensions and debt exchanges designs, to address 2024 and 2025 maturity walls. In what is expected to be a higher for longer rate environment, and given the surge in private credit, we anticipate a higher baseline of financing and capital solutions activity through the next M&A cycle. We continue to invest in scaling our franchise and make selective senior hires to enhance our client footprint and product offering. Year to date, we have added four advisory partners and eight managing directors. with an additional two partners committed to join in the third quarter. Our new hires bring expertise in strategically active sectors, including technology, business and consumer services, aerospace and defense, and stakeholder activism. We have been in a mode of above market talent growth since the lead up to our public listing with consistently 25 to 30% of our partners in their seat for less than three years. These partners are not yet at full productivity and represent a built-in source of revenue growth in the years ahead. We are confident that our steady investment in talent without lowering our high admission standards will prove to be highly accretive to our stakeholders over time. Our financial results in the first half have positioned us very well to execute on our strategic and financial goals for this year and beyond. Thank you to our clients and to our teams globally for their commitment and dedication to our firm and to our mission. Before I turn the call over to Gary, I just want to acknowledge our announcement in today's earnings release that Gary will be stepping down from his position as CFO at the end of the year. We have been so fortunate to have Gary with us since our founding over 17 years ago, with his many contributions so integral to the firm's growth and development, including our transition from a project partnership to a public company. Given that Gary will remain in this position until the end of the year to ensure a smooth transition, I'm sure we will both have more to say on this topic on November's call. But for now, I just want to say thank you, Gary, for your partnership and for your dedication to the firm since day one. And also, I'll finish by saying congratulations to Alex Gottschalk, currently our Chief Accounting Officer, who will become CFO January 1. We look forward to working with her and wish her success in her new role. Gary, over to you.