Moelis & Company

Good afternoon and welcome to the Mollis & Company earnings conference call for the fourth quarter of 2022. To begin, I'll turn the call over to Mr. Matt Sucraw.

Good afternoon and thank you for joining us for Mollis & Company's fourth quarter 2022 financial results conference call. On the phone today are Ken Mollis, Chairman and CEO, and Joe Simon, Chief Financial Officer. Before we begin, I would like to note that the remarks made on this call may contain certain forward-looking statements. which are subject to various risks and uncertainties, including those identified from time to time in the risk factor section of Molson Company's filings with the SEC. Actual results could differ materially from those currently anticipated. The firm undertakes no obligation to update any forward-looking statements. Our comments today include references to certain adjusted financial measures. We believe these measures, when presented together with comparable gap measures, are useful to investors to compare our results across several periods and to better understand our operating results. The reconciliation of these adjusted financial measures with the relevant GAAP financial information and other information required by Reg G is provided in the firm's earnings release, which can be found on our investor relations website at investors.mulls.com. I will now turn the call over to Joe to discuss our results.

Thanks, Matt. Good afternoon, everyone. On today's call, I'll go through our financial results, and then Ken will comment further on the business. First, we achieved $202 million of adjusted revenues in the fourth quarter. For the full year, our adjusted revenues of $970 million were down 38% from the record prior year. Regarding expenses, our full year compensation expense ratio is 63%. For the full year, we reported a non-compensation ratio of 15.6%. The increase in full year non-compensation expenses is largely due to a normalization of travel and related expenses. Looking to the first quarter, we expect non-compensation expenses to be in the $40 million range, excluding episodic transaction-related costs. Our full-year pre-tax margin is 22.5%. Regarding taxes, our normalized corporate tax rate for the year was approximately 27%, and our effective tax rate was approximately 22%. The difference is driven primarily by excess tax benefits related to the delivery of equity-based compensation in the first quarter of 2022. We may recognize a tax benefit in the first quarter of 2023 related to the annual vesting of RSUs later this month. For purposes of quantifying the excess tax benefit, we expect the impact to EPS to be approximately one cent for each dollar and a quarter difference between the vesting and breakeven price of $36 per share. Regarding capital allocation, we remain committed to returning 100% of our excess capital. Our board declared a 60 cent per share dividend. We will have returned approximately $316 million to shareholders with respect to the 2022 performance year, which includes this declared dividend. And lastly, we continue to maintain a fortress balance sheet with $413 million of cash and liquid investments and no funded debt. I'll now turn the call over to Ken.