PJT Partners Inc.

Please stand by. We're about to begin. Good day, everyone, and welcome to the PJT Partners First Quarter 2022 Earnings Call. Today's conference is being recorded. At this time, I'd like to turn the conference over to Ms. Sharon Pearson, Head of Investor Relations. Please go ahead, ma'am.

Thank you very much, Alan, and good morning, and welcome to the PJT Partners First Quarter 2022 Earnings Conference Call. Joining me today is Paul Taubman, our Chairman and Chief Executive Officer. and Helen Mates, our Chief Financial Officer. Before I turn the call over to Paul, I want to point out that during the course of this conference call, we may make a number of forward-looking statements. These forward-looking statements are subject to various risks and uncertainties, and there are important factors that could cause actual outcomes to differ materially from those indicated in these statements. We believe that these factors are described in the risk factors section contained in PJT Partners 2021 Form 10-K, which is available on our website at pjtpartners.com. I want to remind you that the company assumes no duty to update any forward-looking statements and that the presentation we make today contains non-GAAP financial measures, which we believe are meaningful in evaluating the company's performance. For detailed disclosures on these non-GAAP metrics and their GAAP reconciliations, you should refer to the financial data contained within the press release we issued this morning, which is also available on our website. And with that, I'll turn the call over to Paul.

Thank you, Sharon, and thank you all for joining us this morning. Earlier today, we reported our Q1 financial results. For the quarter, we generated revenues of $246 million. adjusted pre-tax income of $56 million, and adjusted earnings per share of $1. Measured against each of these metrics, we had our strongest first quarter ever with broad-based strength across our businesses. Our PJT Park Hill and restructuring businesses delivered significant year-over-year growth in revenues, with strategic advisory revenues down just slightly compared to strong year-ago levels. As we mentioned on our fourth quarter earnings, we expect the strong momentum we are seeing in our strategic advisory business to increasingly shine through as the year progresses. After Helen reviews our financial results, I will review each of our businesses in greater detail. Helen?

Thank you, Paul. Good morning. Beginning with revenues. Total revenues for the quarter were $246 million, up 19% year-over-year. And as Paul mentioned, we had significant revenue increases in PJT Parkell and restructuring, and a slight decline in strategic advisory revenues. Turning to expenses, consistent with prior quarters, we've presented the expenses with certain non-gap adjustments, and these adjustments are more fully described in our 8K. First, adjusted compensation expense. We accrued adjusted compensation expense at 63% of revenues for the first quarter, which is flat. This is our full year 2021 ratios and represents our current best expectation for the full year 2022 ratio. Turning to adjusted non-compensation expense. Total adjusted non-compensation expense was $35 million in the first quarter, up from $28 million in the same period last year. As a percentage of revenues, our non-compensation expense was 14.2% for the first quarter, up from 13.5% in the same period last year. We saw a meaningful increase in travel and related activity in March, although activity remained below pre-COVID levels. Not surprisingly, travel and related costs were the most significant driver of our higher non-comps in the quarter at $4.5 million compared with $500,000 in the prior year. Excluding travel and related expenses, our non-comp expenses in the first quarter were up 11% year over year. With further growth in headcount, continued investment in IT, and increased business activity, we continue to expect our full-year non-compensation expenses, excluding travel and related, to grow in aggregate in the low double-digit percentages year over year. In terms of our travel and related expense, those numbers are likely to grow as the year progresses. Turning to adjusted pre-tax income, we reported adjusted pre-tax income of $56 million for the first quarter, up 13% year over year. and our adjusted pre-tax margin was 22.8% for the first quarter compared with 24% for the same period last year. The provision for taxes as with prior quarters we've presented our results as if all partnership units had been converted to shares and that all of our income was taxed at a corporate tax rate. Our effective tax rate was 25.8% for the first quarter compared with 22.3% for full year 2021. We had a lower tax benefit relating to the delivery of vested shares relative to their amortized costs compared to last year. We take a full year view of that benefit and would expect our full year effective tax rate to be in line with the first quarter rate of 25.8%. Earnings per share are adjusted if converted earnings were a dollar per share for the first quarter up 12% compared with 89 cents per share in the first quarter last year. For the share count, for the quarter, our weighted average share count was 41.8 million shares. During the first quarter, we repurchased the equivalent of approximately 1.2 million shares, including approximately 887,000 shares in the open market. The balance of the repurchases came from the exchange of partnership units for cash and the net share settlement of employee tax obligations. In addition, we plan to exchange 65,000 partnership units for cash on May 3rd, 2022. On the balance sheet, we ended the quarter with 96 million in cash, cash equivalents and short-term investments, and 218 million in networking capital. We had a modest draw on our revolver in the quarter, which has now been repaid. The board has approved a new authorization of $200 million for the company's common stock repurchase program in addition to the $17 million left in our prior share repurchase authorization. And finally, the board has approved a dividend of 25 cents per share. The dividend will be paid on June 22nd, 2022 to Class A common shareholders of record as of June 8th. And with that, I'll turn it back to Paul.

Thank you, Helen. Beginning with PJT Parkhill. Our PJT Park Hill business delivered strong performance in the first quarter compared to the prior year and continues to track toward another year of record performance. 2022 is shaping up to be an extremely busy but challenging year for alternatives fundraising. Many managers are back out fundraising with record setting fund size targets. In this increasingly crowded marketplace, some managers may struggle to meet their fund size targets as asset allocators become increasingly selective and capital constrained. Despite this challenging backdrop, we are well positioned to continue our strong performance. On the fundraising side, the team's rigorous selection process enables us to bring the highest quality fund managers with differentiated strategies and differentiated track records to investors. In secondary advisory, our leadership position advising on large, complex, GP-led transactions coupled with our deep network of LP relationships allows us to facilitate the institutional investors increased demand for capital redeployment and liquidity. Turning to strategic advisory. Given the early stages of our advisory build-out, we are disproportionately levered to the number of new client relationships developed rather than the level of overall M&A activity. Our ability to cultivate new banking relationships is greatly enhanced when we meet clients in person where our collaborative culture and differentiated capabilities can best be appreciated rather than over Zoom. To that end, our strategic advisory business is benefiting greatly from the resumption of travel, in-person meetings, and more personal client engagement. Our strategic advisory practice also continues to benefit from the contribution of PJT Camberview's unique investor-focused perspectives and relationships. As these two disciplines continue to meld together, the depth of our client relationships strengthens appreciably. As previously communicated, we have consistently forecast 2022's global M&A volumes to decline relative to 2021 levels. However, we remain confident that 2022 will be another record year for our strategic advisory business. As the momentum in our increased client dialogues, mandates, and announced transactions is increasingly reflected in our financial results as the year progresses. Turning to restructuring. Although we continue to expect overall 2022 restructuring activity levels to be largely in line with 2021, stress is beginning to build in the system. The combination of increasing interest rates inflationary pressures and supply chain are having an impact on many companies that emerged from the COVID-19 pandemic with highly leveraged capital structures. Further disruptions caused by the war in Ukraine are impacting companies everywhere, but particularly in Europe. We continue to believe that it is simply a matter of time before we see a meaningful uptick in overall restructuring activity. Our restructuring practice continues to be a market leader receiving numerous accolades for its best-in-class capabilities, including being named Global Restructuring Bank of the Year by IFR for the second year in a row. Not yet ready to suggest we are at an inflection point, we have seen some uplift in PJT's number of restructuring mandates. Accordingly, we now believe that our 2022 restructuring revenues will increase slightly from 2021 levels. Turning to our capital priorities, Our first investment priority continues to be attracting and developing best in class talent. Even with the challenges of recruiting in a COVID environment, both strategic advisory partner and non-partner head counts grew at double digit rates over the past 12 months. Offsetting the sheer dilution resulting from our human capital investments remains a close second in terms of capital priorities. At recent trading levels, the compelling investment opportunity in our shares caused us to wait our 2022 open market share repurchases to earlier in the year. We committed more dollars to open market repurchases last quarter than in any previous quarter. As a result of our significant open market repurchases, We have, as of today, only $17 million left on our previous share repurchase authorization. Consequently, the Board has approved an additional share repurchase authorization of $200 million. As before, we intend to remain active repurchasers of our shares, but that activity is likely to slow in the second half of the year, as we continue to be mindful of our float. Looking ahead, we said earlier this year that all of our businesses outside of restructuring were poised for record performance in 2022. That continues to be the case. And our leading restructuring franchise continues to be well positioned for when the inevitable restructuring wave hits. Our unique combination of businesses and the significant expansion opportunities that lie ahead position us well to drive significant growth. We remain confident in our prospects for 2022 and the years to follow. And with that, we will now take your questions.

Thank you, sir. If you'd like to ask a question, please signal at this time by pressing star 1 on your telephone keypad. If you're using a speakerphone, please make sure that your mute function is turned off to allow your signal to reach our equipment. Once again, that is star 1 if you'd like to ask a question. We'll take our first question from Devin Ryan with JMP Securities.

Thanks. Good morning, everyone. How are you?

Good morning, Devin. We're fine, thank you.

Great. First question just on kind of the broader outlook. So we appreciate all the guidance across all the different businesses. It sounded pretty similar to the commentary you guys gave with the fourth quarter call. Clearly, the macro backdrop has been pretty choppy since then. You create an escalation. So there's been a number of shifts in the backdrop. So I'm just curious, you know, Are you seeing kind of a change in mix of activity in advisory, as an example? Are there sectors that are outperforming? Is there a shift there that's kind of giving you comfort in that outlook? Or anything else you can kind of provide around more on the strategic advisory side that gives you comfort that there should be a year of solid growth against a pretty volatile backdrop with a lot of uncertainties?

I appreciate the question. I'd say three months ago, we communicated a view of 2022, which had already baked into it an assumption that the world was going to become more complex, markets more volatile, and the macro environment more challenging. I would say that overall since then, The world is probably a bit more unsettled than we had previously thought. And our view on our full year prospects is equal to, if not slightly more constructive than it was at the beginning of the year. And I think that that's really across the board strength. But a lot of that is that our advisory business is by and large, decoupled from the macro environment. Clearly, at some point, if M&A activity shuts down, it shuts down completely. But if it doesn't shut down, it's much more for us a function of relationships, connectivity, the benefit of previous investment, being able to further support our businesses. And we're seeing that strength across the board. And of all of the Of all of the expense variances, the one that I really enjoy seeing is a travel variance because the more that people are out on planes, trains, and automobiles, seeing clients, engaging, that is good for our business, and I think we have benefited from that. Yep.

Okay, terrific. And then just to follow up on the restructuring side of the business, obviously caught the commentary around kind of a slight increase is the expectation now. You know, I think the market's kind of thinking about just what an abrupt normalization in Fed policy means for obviously the macro backdrop, and that's a big picture question, but just thinking about just at a high level what that could mean for restructuring activity and any early anecdotes. I appreciate you probably don't want to get too far out of your skis and then restructuring revenues do take time to materialize. So it might even be more of a 2023 story if restructuring starts to pick up. But just, you know, the view on rates has changed in the market in recent months. And so is that the bigger driver or is it just more function of you're starting to see some stress in pockets? Some color there would be helpful. Thanks.

Sure. Sure. Look, I think it's a little bit of everything. I think clearly there were companies that were challenged that in more normal markets would have needed to do substantive restructurings in 2021. But just given the extraordinary risk on marketplace, meme stocks, SPACs, an abundance of capital, everyone chasing yield, a lot of those companies were able to sidestep having to to restructure balance sheets. That risk on environment and mentality and mindset is clearly no longer present, certainly to the extent it was a year ago. So companies that were able to do amended extends and the like and kick the can down the road or to raise fresh equity, that that sort of path is increasingly being blocked. So you have that. Then on top of that, with companies that operate with relatively thin margins, it's the confluence of rise in interest rates, inflationary pressures, commodity costs, labor costs, supply chain disruptions. And if you're dealing with relatively thin margins to begin with, that puts pressure on companies. And at some point, we'll have to see, as the Fed tries to take all of this liquidity out of the marketplace and tries to tamp down inflation, the question is going to be, can they do that and get us to a safe landing? Or is there some potential that we'll will hit a true contraction from a macroeconomic perspective. And if we then do that, and demand dries up for a lot of these companies, you'll see another wave. So if you just look at the way high yield credit is trading, you're seeing a lot of pressure, but not enough to move them from some pressured credits to really troubled credits. And I think that the stress is still early and I wouldn't begin to suggest when we might see a step function change. But what I am comfortable with is that we've sort of bottomed out in terms of restructuring activity. We as a firm have been quite successful in securing a significant number of mandates recently. And I just think the tenor of our business is more constructive today. than it was three months ago and certainly relative to the middle of last year.

Great. Okay. Good color. Thanks, Paul. Appreciate it.

Thank you, Devin. And your next question will come from the line of James Yarrow with Goldman Sachs.

Hey, thanks a lot for taking my questions. So we obviously saw record moves in interest rates in the first quarter and rates have moved further in the second quarter. How, if at all, is this impacting your strategic advisory dialogue? And if not, at what level of rates would you sort of expect this to become more of a dampening effect on that side of the business?

Look, I think it's going to – rates are still quite low from any historic perspective. And really the issue is whether or not Companies can finance transactions and I think there there's an enormous amount of capital in the marketplace It's just that the cost has gone up but at the same time you've seen some pressure on equity Values and the like so it's not all a one-way trade. I think the bigger issue is really just uncertainty and volatility and If you look at Europe, I think with, you know, as we had said previously, with elections in France, and there will be additional elections in France, I think a lot of companies who are waiting to look at the broader political landscape, there have been various points in time when it looks as if the attack on Ukraine would continue to escalate. At other points in time, there's been some hopeful signs of progress. I think until the world sort of settles out, it's going to put a bit of a damper, but I don't think that the level of rates today or the ability to secure financing is having a chilling effect on activity. I think it's just raising the bar a little bit, and there are a lot of companies who are going to need to transact a strategic perspective who might find the current environment not as welcoming as where it was a year ago, but you're still seeing a lot of transactions across industries, geographies, sizes. So I'm not really able to tell you exactly, formulaically, when the market shuts down, but I think at this point in time, we're not anywhere near that. but we have taken a bit of a breather from last year's frenetic pace, and I think it's important to just look at the sheer volume of activity last year and the fact that with all of this volatility and with all of this uncertainty and with this move in rates, the way we look at it, the M&A global market volumes are down about 15% year-to-date, and that to me shows quite a bit of health in the in the system.

Okay, that makes a lot of sense. So maybe if we do enter a more prolonged period of weaker economic growth, you obviously have a lot of durability across your business largely from restructuring, and we saw this sort of play out in 2020. So maybe if you could just talk about if we did enter that sort of prolonged economic downturn, is that an opportunity for you to grow you know, more quickly in terms of hiring? And then, you know, would that, you know, given your relative strength versus more, you know, perhaps strategic advisory skewed firms, would it make it more attractive for you to do more, you know, inorganic type, you know, activity?

Well, look, on the hiring side, we're a growth company. We see enormous growth opportunities. We're going to continue to grow, but we're not going to chase growth. So we... destination for talent and all of the talent that fits our culture that can add to our capabilities where we're all in and that's never been the issue and we're going to continue to grow as we said consistently when you're trying to recruit and everyone is locked down in a coded sequestration and they're all from home it's far more difficult than when you can get people in person, face-to-face, and let them walk the halls and really feel how special our firm is. And as the COVID lockdown and the work from home recedes and we get back closer to the old normal, that's going to benefit us from a recruiting perspective, and we've already seen that. The other thing is, when you're talking to best-in-class investment bankers and they're dealing with a tsunami of deals because 2021 is the height of activity, it's difficult for those individuals to really extricate themselves from all of their client entanglements. So what we've also said is that, perversely, if the market slows down a little bit, and bankers catch their breath, it's easier for us to have those substantive conversations and the switching costs go down. So the way we see it, all of those sight lines are positioning us to be able to pick up our recruiting momentum because of that confluence of events. And when we think about where we can add best in class talent, it's really across the firm. There's no doubt A disproportionate amount is going to be in strategic advisory, but in our Park Hill and restructuring businesses, there's always opportunities for us to add best-in-class individuals. And then as it relates to acquisitions and the like, I've been quite consistent, which is if you can find the right ones that are simpatico with the culture and bring the right incremental capabilities that are not duplicative, it's a wonderful thing. They're just very difficult to find. We have a high bar for those.

Okay, thank you. Thank you. The next question comes from the line of Stephen Chubek with Wolf Research. Good morning, Paul. This is Brendan O'Brien filling in for Stephen.

So on sponsors, while your firm is viewed as being more reliant on large-cap strategic M&A, recent trends suggest that you've had a lot of success winning deals among sponsors. Can you speak to the strength of your sponsor franchise and whether the recent wins within the space is something we should anticipate more of going forward and maybe provide a bit of color on your strategy for growth there?

Sure. Well, first of all, I've always said that there are two types of firms. There are firms that do large deals and small deals, and there are firms that just do small deals. And just because you do large deals does not mean you do not do smaller deals. There's always a reason why you want to be able to follow your clients. It may be to have insights into new technologies. If you're a fintech banker, by definition, you're looking at the next generation disruptors. If you're a medtech banker, a a life sciences banker, by definition, you're looking for the next company that's going to be able to sort of change the lives of people from a drug discovery perspective. So you always need to be going up and down, but there are only certain firms that have the confidence of the largest, most sophisticated companies to do the largest and most complex transactions. And that's the space that we seek to occupy is to be called upon to do the largest, most complex, most sophisticated transactions, but also to be able to find opportunities and to follow our clients regardless of transaction size. And as it relates to financial sponsors, what we've consistently said is we're on a journey, and every day that goes by, we strengthen our firm by adding more capabilities. We have more domain expertise. We have more capabilities. We have more ways in which we can serve clients. And we have a lot of incumbent strengths as it relates to financial sponsors. We have our Park Hill business, which touches an enormous number of alternative GPs. We have a leading restructuring practice. spends a lot of time dealing with highly leveraged situations and sponsors have a disproportionate number of portfolio companies with leveraged capitalizations. We have deep domain expertise in many industries and as a result that creates a compelling reason for sponsors to want to talk to our bankers. We have a significant initiative in direct lending, which is another reason. And every day that goes by, we do more of that. I've always seen sponsors as being an ever-increasing part of our practice, and it's just part of the journey. So I wouldn't monitor it too much quarter to quarter, but I am quite confident that over time, you know, our – balance of business between corporates and sponsors will look a lot more like the way the overall market breakdown is between corporates and sponsors.

That's great, Colin. Thanks for that, Paul.

And then as a follow-up, as you noted, the conflict in Ukraine is having an impact on activity across all geographies, but it feels like Europe has been more severely impacted given its closer proximity and heavier reliance on Russian exports. Is there something you can discuss what you're seeing in terms of activity within the region on both a standalone basis and relative to the U.S. across both strategic and sponsor M&A? And maybe a little bit of a compare and contrast on the restructuring side as well.

I'd be delighted to. Look, the reality is that the statistics are not that different. And if you look at, you know, this down 15%, in activity levels globally, year to date, the way we measure it. And we look at it ex-SPACs, because I've always questioned whether SPAC transactions are really another form of IPO, whether they're really true M&A business. But if you look at it that way, we see the market as being down about 15%. There's no doubt that the US has been strongest. Europe has not been that much weaker And it's really rest of the world and clearly Asia has been the most challenged during that time. I think there are real pockets of strength in Europe. I think the UK continues to be a significant opportunity. I think there is a very significant number of compelling investment opportunities in the UK. And sponsors are increasingly focused on you know, smaller and mid-sized companies in the UK because they afford compelling valuations and there continues to be a valuation disconnect between the way companies are valued there and the way they're valued in the US. And that's probably where you're seeing the greatest strength. I think the election results in France are a positive for some renewed, you know, strategic activity in France. And I think it's just gonna be very much dependent upon how all of these sanctions play out, whether there's any escalation or whether we can hopefully get an end to this horrific conflict in the near term. So I'm not ready to tell you exactly what the outlook is, but no doubt, because no one knows, but I think, you know, no doubt that the further you are from Europe, the more insulated you are. I think China has its own issues, but there are certainly, you know, significant pockets of activity in Europe. And I'd also make the point that when we talk about our firm, you know, we're still a much smaller firm and we're really not dependent on macro trends or themes. We're truly building our firm and our franchise one client at a time. And we continue to be quite optimistic about our progress in Europe, notwithstanding the overall macro environment.

And that's what makes our firm so different and so special.

Great. That's great, Collier. Thanks for taking my question.

Thank you. The next question will come from Jeff Hart with Piper Sandler.

Good morning. Congrats on a good quarter. A couple of follow-ups. A lot has been asked. When it comes to restructuring, you mentioned maybe things looking a little better, and also the higher revenues kind of driving a lot of the year-over-year growth and advisory. I'm assuming the higher revenues are kind of completions of deals that were already in the works as opposed to kind of revenues coming from new mandates. Is that the right way to think of it?

Well, in the quarter, I'm sure that there was relatively little new in the quarter that came in the door and was executed in the quarter. There's some of that, but that's why when we think about the health of our business, we're always looking at our pipelines and our mandate counts and the like. So that is correct.

Most of the first quarter came in before, but some of it not that much before.

Okay, and as we think, when you talked about maybe 2023 being a little better than 2021, that's on a revenue basis, or are you kind of looking at activity levels, figuring all the revenues may take longer to show up?

I'm sorry, you mean 2022?

Yeah, I'm sorry. 2022 maybe being slightly better for 2021 for you guys in financial restructuring. Are you referring to revenues, or are you referring to mandates and kind of activity levels.

Revenues.

Okay. That's what I thought. And finally, when we look at expenses, as long as growth keeps coming, that's great. It seems like it's going to keep coming. If we actually tip into a recession and things really stop on the M&A front, is there kind of a floor dollar amount or a fixed portion of compensation we should kind of be thinking about?

Hey, Jeff, it's Helen. I would say it's hard to say what a flawed dollar amount is because the fixed component of our cost base does grow. One good example would be occupancy, where it's relatively fixed, but there is some small relative investment. But we think of our cost base as being roughly 60% fixed or fixed-like, and that we've always said we think grows more slowly than the variable expense. So we would assume that base stays in place.

Okay, thank you. All right, your next question comes from the line of Michael Brown with KBW.

Hi, good morning. Thanks for taking my questions. Well, I wanted to... Narrowing on the restructuring cycle here as we perhaps start a new cycle this year, how do you anticipate the early part of the restructuring cycle to perform? Should we expect to see a rise in bankruptcies? Is that when the cycle will officially start to contribute for your business, or would you expect to see a lot more non-traditional restructuring activity that could start to come through before traditional bankruptcies rise? And maybe just to follow up on the restructuring, how is your business in China? Have you guys been working on any of the mandates there related to the Chinese property sector?

I don't like to talk about specific situations. What I will say is we

If you look at our history of transactions, you'll see that while we have a very small presence in mainland China, we do have an office in Hong Kong. We have represented companies in the region, and we do have significant access capabilities and the like, so we're certainly mindful of that opportunity, but It has not been an opportunity that we've committed enormous onshore presence to. We've done this all sort of offshore, but we do have a leading restructuring practice with a lot of experience working with companies in the region and have significant expertise. And then obviously there are many of those situations that have a creditor side to it where you're dealing really with global credit funds and the like. So that's probably the best way to talk about that. On the restructuring side, I think there's really two things. If there's a shock, a true shock to the system, then everything is in play. And that's what we saw in March and April of 2020. We're not there and we're not close to that. At some point we may be, but we are not close to that. What we are seeing is really getting back to a more normal normal because 2021 was not a more normal normal because there were just so many pockets of capital so many folks facing growth and yield that a lot of companies who should have been restructured in a more traditional environment were able to avoid it. And when we think about stress in the system, one of the best early indicators is just to look at high yield debt trading levels and to see how the market is trading a lot of these credits. And what you're seeing is there are more companies that are pressured today but there are still a very, very few number that are trading as broken credits. And that's probably the single best early indicator of where the market is going. And in that environment, we spent a lot of time looking to restructure companies out of court and use our financial strengths and skills to do that. So we have a balance of of capabilities, and then it also is a function of which region of the globe, because it's really the U.S. has its unique Chapter 11 proceedings, but there are plenty of other ways to resolve credit situations in a negotiated manner. So you should expect to see us in all of those elements. And then there are a lot of companies who are now at least prepared to have a conversation on liability management, when it would not have been deemed to be pressing a year ago. And that just brings in a whole other list of capabilities from our firm. So I think this is something where it's going to take a while for the pot to simmer and potentially boil. What's really more important to us is last year, we simply experienced a retreat all the way back to pre-COVID levels from the enormous COVID activity. And what we've done is we have been able to put a floor under the 2021 activity level. And as we no longer have that headwind, I think the strength of our other businesses, which was really the case in 2021, but it was obscured, by the pullback in restructuring, that that's increasingly shining through, and you're now being able to see, because you no longer have the restructuring headwinds, you're seeing the core underlying strength in our Park Hill business, our Canberra View business, our strategic advisory business, and on top of that, I suspect there'll be a moment in time where the restructuring activity level spikes appreciably,

We're not there yet, and I am not even close to suggesting that that's in the near term.

Okay, got it. Thanks, Paul. That was a really helpful caller. And then maybe just one last one for me on the placement business. This quarter you talked about the fact that the fund placement revenues were the real contributor and the corporate placement activity was a bit lighter. versus the prior year. When you think about the placement business and the outlook for the rest of the year, is it fair to expect that that's going to be the right mix here? And I'm assuming that that's a reflection of the SPAC market and the outlook there versus 2021. And then just one other follow-up on that. Can you remind us of the seasonality in that business? It looks like the second quarter is usually a bit slower off of the first quarter when I look back over a couple of years with a stronger year end for that business. So I just wanted to check to see if that's the right way to think about the revenue seasonality.

Just as I continue to remind folks, This placement versus advisory demarcation is increasingly less relevant in understanding our firm because the placement has got strategic advisory and Park Hill in it, and advisory has strategic advisory and Park Hill in it. And it's really not a direct representative of either because parts of of both of those businesses get booked in both placement and advisory, and therefore the splits are something we spend increasingly less time on. If you ask me about the Park Hill business, to the extent there is seasonality in the Park Hill business, it tends to be in Q4 because there's a little bit more momentum to not have closings necessarily. It's one thing to have a closing roll from Q1 to Q2 or Q3 to Q4, there tends to be more of a forcing function to have it close in the year, but there's really no other observed functionality.

Okay, great. Thanks, Paul. Thanks for taking my questions. Thank you, Mike.

Yes, and that was our final question, so I'd like to now turn it back over to Mr. Paul Taubman for his closing remarks.

I gather there may have been a little static on this call, which I can only apologize for. And I, again, appreciate everyone's time and attention and interest in our company. And we'll get back at it in three months. And I wish everyone a good day, and we'll be speaking soon.

Thank you.

That does conclude today's conference. We thank everyone again for their participation.