Q3 2025 Houlihan Lokey Inc Earnings Call Transcript
Key Points
- Houlihan Lokey Inc (HLI) reported a 24% increase in revenues and a 34% increase in adjusted earnings per share compared to the same period last year.
- Corporate finance revenues grew by 36% year-over-year, with improvements in key metrics such as close rates and transaction volume.
- The company successfully closed its acquisition of Waller Helms, contributing positively to the quarter's results.
- Houlihan Lokey Inc (HLI) added 17 new Managing Directors, enhancing its leadership team and capabilities.
- The company maintains a positive outlook for fiscal 2026, driven by improving M&A market sentiment and increased private equity activity.
- The average transaction fee in corporate finance decreased due to transaction mix, despite an increase in the number of transactions.
- Financial restructuring revenues only increased by 2% compared to the same period last year, indicating slower growth in this segment.
- Adjusted compensation expenses rose significantly to $390 million, up from $314 million in the same quarter last year.
- The adjusted effective tax rate increased to 33.3% from 30.3% in the same quarter last year, primarily due to timing issues.
- Despite improvements, transaction velocity has not yet returned to pre-pandemic levels, indicating a gradual recovery.
Good day, ladies and gentlemen. Thank you for standing by. Welcome to the Houlihan Lokey's third quarter fiscal year 2025 earnings conference call. (Operator Instructions). Please note that this conference call is being recorded today, 28 January 2025. I will now turn the call over to the company.
Thank you, operator and hello, everyone. By now, everyone should have access to our third quarter fiscal year 2025 earnings release, which can be found on the Houlihan Lokey 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
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