PJT Partners Inc Q1 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Alex Jenkins - Citizens JMP - Analyst : Hey Paul, hey Helen, this is Alex Jenkins filling in for Devin. Hope you guys are doing well. I appreciate you taking my question. Just to start on strategic advisory and partner productivity there, I just love to get your thoughts on how you think about the order of magnitude to the upside for partner productivity, that you think you could get to if we got back to like a more normal operating environment? Thank you.

Question: Alex Jenkins - Citizens JMP - Analyst : Okay, great. Thank you for that color. And then just a quick follow up on the restructuring business. Obviously I touched on in your remarks. There's a lot more economic uncertainty. Maybe you could speak to the growth algorithm for that business off what is already a really productive group. Will your bankers be more selective and just trying to understand how much capacity there might be from what already is a great level of production. Thank you.

Question: Alex Jenkins - Citizens JMP - Analyst : Great. Thank you. That's great color. I appreciate it.

Question: James Yaro - Goldman Sachs - Analyst : Good morning and thanks for taking my questions. I wanted to touch on the discussions that you're having with private equity today. To what extent, are they slowing their previous plans to conduct M&A and IPOs this year, and potentially beyond? And then as a corollary, what are your expectations for the growth of the secondary business perhaps for this year, and 2026 as well?

Question: James Yaro - Goldman Sachs - Analyst : Excellent. Maybe just a follow up on the dynamics you spoke about. Maybe you could also just give us your outlook for LP secondaries given the same dynamics, and then separately I'd imagine a weaker private equity deployment backdrop could on the fundraising business, which I think you alluded to a little bit, maybe you could just help us think through the backdrop for primary fundraising and the extent to which the longer term opportunities set in the business could change if IRRs and DPI are lower on current vintages.

Question: James Yaro - Goldman Sachs - Analyst : That's very clear. Thanks, Paul.

Question: Jim Mitchell - Seaport Global Securities LLC - Analyst : Hey, good morning. Paul, you kind of highlighted, hey, you highlighted the high yield market showing some signs of stress, right? Does that at all at least temporarily hurt your ability to execute liability management assignments, and I guess if that persists, do we start to see some of those assignments get pushed into towards chapter 11? Just curious how you're seeing that dynamic.

Question: Jim Mitchell - Seaport Global Securities LLC - Analyst : Can private capital, private credit pick up some of the slack if the public markets are closed or is it just not there enough just curious if that's a source of funding for the liability management space? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. APRIL 29, 2025 / 12:30PM, PJT.N - Q1 2025 PJT Partners Inc Earnings Call

Question: Jim Mitchell - Seaport Global Securities LLC - Analyst : Very helpful. And this may be a longer-term question. Just the tariff uncertainty it seems pretty clear it's going to drive a lot of companies to move and or diversify their supply chain, so in the longer run, do you see that as an incremental catalyst for deal activity, or is it just more of a pain point rather than an opportunity set longer-term, just curious how you think about it.

Question: Jim Mitchell - Seaport Global Securities LLC - Analyst : All right, great. Thanks for the color.

Question: Brendan O'Brien - Wolfe Research, LLC - Analyst : Hi, and thanks for taking the question. (technical difficulty)

Question: Brendan O'Brien - Wolfe Research, LLC - Analyst : Yeah, sorry about the poor connection.

Question: Brendan O'Brien - Wolfe Research, LLC - Analyst : That's helpful, and hopefully you can hear me a bit better now but for last quarter, I believe you alluded to maybe a slight slowdown in recruiting last this year after an aggressive couple of years of recruiting previously, but just given the softer levels of activity year-to-date, I just want to get a sense as to whether you're seeing any improvement in the recruiting environment. And whether this might cause you to re-accelerate hiring in a way that you weren't expecting at the start of the year? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. APRIL 29, 2025 / 12:30PM, PJT.N - Q1 2025 PJT Partners Inc Earnings Call

Question: Brendan O'Brien - Wolfe Research, LLC - Analyst : That's great and thanks for taking my questions and apology for the connection issues.

Question: Brendan O'Brien - Wolfe Research, LLC - Analyst : (inaudible)

Question: Benjamin Rubin - UBS Equities - Analyst : Hi, thanks for taking my questions. I thought the commentary that your full-year outlook has not changed was actually pretty encouraging and in 2024, obviously you guys had record revenue across your three businesses. So I'm just curious, how are you thinking about the different growth trajectories across Park Hill restructuring strategic advisory in light of the uncertainty. And then also you mentioned in your prepared remarks that your backlog remains at record levels. So just curious, has there been any shift in either the quality or expected timing of your M&A pipeline thus far in April? Thank you.

Question: Benjamin Rubin - UBS Equities - Analyst : Great. Thanks for the color, Paul. I wanted to shift gears onto the comp ratio. You mentioned heading into this year that you were set up well to begin delivering comp leverage in '25, and you were able to do such in the first quarter, bring it down roughly 150 basis points. So I'm just curious, what would you to see in terms of the deal backdrop through the course of this year such that you would be more comfortable bringing it down further if possible and also how much incremental recruiting costs does the 67.5% assume as far as additional hiring is concerned? Thank you.

Question: Benjamin Rubin - UBS Equities - Analyst : Great. And then just a quick follow up the 67.5% reflects your best estimate as of the end of the quarter, 331 or as of April? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. APRIL 29, 2025 / 12:30PM, PJT.N - Q1 2025 PJT Partners Inc Earnings Call

Question: Benjamin Rubin - UBS Equities - Analyst : Alright great. Great thanks guys for answering my questions.

Question: James Yaro - Goldman Sachs - Analyst : Thanks to follow up. Just I think on your buybacks, you repurchased a healthy quantity of stock in the quarter, and I think that understates -- underscores the unchanged guidance you provided. Maybe you could just help us think through the cadence for buybacks from here, and perhaps the time frame over which you believe you could fully offset the share account dilution from the past few years?

Question: James Yaro - Goldman Sachs - Analyst : Okay. I appreciate the color. Thank you.