Houlihan Lokey, Inc.

Good day, ladies and gentlemen. Thank you for standing by. Welcome to Houlihan-Loki's third quarter fiscal 2020 earnings conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. Please note that this conference call is being recorded today, February 3, 2020. I will now turn the call over to Christopher Crane, Houlihan-Loki's general counsel.

Thank you, operator, and hello, everyone. By now, everyone should have access to our third quarter fiscal 2020 earnings release, which can be found on the Houlihan-Loki website at www.hl.com in the investor relations section. Before we begin our formal remarks, we need to remind everyone that the discussion today will include forward-looking statements. These forward-looking statements, which are usually identified by use of words such as will, expect, anticipate, should, or other similar phrases are not guarantees of future performance. These statements are subject to numerous risks and uncertainties that could cause actual results to differ materially from what we expect. And therefore, you should exercise caution when interpreting and relying on them. We refer all of you to our recent SEC filings for a more detailed discussion of the risks that could impact our future operating results and financial condition. We encourage investors to review our regulatory filings, including the Form 10-Q for the quarter ended December 31, 2019, when it is filed with the SEC. During today's call, we will discuss non-GAAP financial measures, which we believe can be useful in evaluating the company's financial performance. These measures should not be considered in isolation or as a substitute for our financial results prepared in accordance with GAAP. A reconciliation of these measures to the most directly comparable GAAP measures is available in our earnings release and our investor presentation on the HL.com website. Hosting the call today, we have Scott Beiser, Houlihan Loki's Chief Executive Officer, and Lindsay Alley, Chief Financial Officer of the company. They will provide some opening remarks, and then we will open the call to questions. With that, I'll turn the call over to Scott.

Thank you, Christopher. Hello everyone and welcome to our third quarter fiscal 2020 earnings call. We had a strong fiscal third quarter. We generated a record 334 million in revenues, an increase of almost 12% versus the same quarter last year. And this was the first time we've achieved quarterly revenues in excess of 300 million. Adjusted earnings per share were 88 cents, a quarterly record for the firm, and an increase of 14% versus the same quarter last year. We also announced our quarterly dividend of 31 cents per share for the fourth quarter. Year-to-date revenues of 857 million are up 8% compared to the same period last year, and we continue to see good momentum across all three of our business lines as we enter the fourth quarter of our fiscal year. So far this fiscal year, the firm has capitalized on a number of favorable macroeconomic trends. The U.S. economy continues to exhibit stable growth, notwithstanding an economic expansion that is now in its 11th year. The stock market had an exceptional 2019, helping to support a good mid-cap M&A market. And finally, access to capital remains strong and interest rates remain low, facilitating a healthy leveraged lending environment which supports private equity M&A activity. These macroeconomic factors provided a strong tailwind to fuel growth in both our corporate finance and financial and valuation advisory businesses, and we expect that tailwind to continue into our fiscal fourth quarter. Our financial restructuring business continues to perform well despite the current low default environment in the credit markets. Ongoing technology disruptors, changes in consumer buying habits, company mismanagement, and over-leverage have all contributed to current growth in a restructuring business without the typical characteristics of a business downturn or higher interest rates. With respect to company-specific trends, in corporate finance, the number of sell-side, buy-side, and capital markets opportunities continues to grow, as does our average transaction size. Throughout calendar 2019, we saw softness in our European business, but over the last couple of months, we have started to see improving M&A and capital markets activity heading into the recent UK election. To date, in the U.S., we have not experienced any changes in the pace of companies and investors exploring M&A opportunities in anticipation of the outcome of the U.S. elections later this year. In financial restructuring, we continue to experience balance in our business between debtor and creditor work. And in fact, in fiscal 2019 and fiscal 2020 year to date, our debtor revenues and our creditor revenues were pretty evenly split. And finally, our financial and valuation advisory business continues to show improvements in productivity and increased diversification as all of its primary subproduct lines are performing well year-to-date. Turning to some of our specific accomplishments during the quarter. On the acquisition front, as previously announced, we closed two transactions. We acquired Fidentis Capital, an investment banking business in Spain, and Freeman & Company, a New York-based investment bank that provides advisory services to companies in the financial services industry. We continue to monitor and pursue other acquisition opportunities as we maintain that the right acquisitions are an important part of our business model. On the hiring front, we brought on two MDs in our third quarter, a healthcare banker and an oil and gas banker, and we continue to see a robust market for talented managing directors interested in joining the Houlihan Loki platform. Finally, with calendar 2019 behind us, Coulahan-Locke continues to be a leader across all three of our business lines. In corporate finance, we are the number one M&A advisor for all U.S. transactions for the last five consecutive years. In financial restructuring, we're the number one global financial restructuring advisor for the sixth consecutive year. And in financial and valuation advisory, we're the number one global M&A fairness opinion provider over the past 20 years. all based on the number of transactions, and according to Refinitiv, formerly known as Thomson Reuters. While recently there have been more factors positively impacting our business, we are ever mindful of how quickly events can change. The outcome of US elections, geopolitical events, the coronavirus, trade disputes, or a general downturn in the economy are all factors that could create headwinds and impact our business. We strive to successfully manage around or through any macro business risks in order to maintain solid financial results in any economic environment. With that, I'll turn the call over to Lindsey.