Evercore Reports Full Year 2021 Results; Record Fourth Quarter and Full Year Revenues and Net Income; Quarterly Dividend of $0.68 Per Share

NEW YORK–(BUSINESS WIRE)–Evercore Inc. (NYSE: EVR):

		Fourth Quarter Results														Full Year Results
		U.S. GAAP							Adjusted							U.S. GAAP							Adjusted
		Q4 2021			Q4 2020				Q4 2021			Q4 2020					2021			2020				2021			2020
Net Revenues ($ mm)		$	1,115.8		$	927.3			$	1,124.1		$	969.9			$	3,289.5		$	2,263.9			$	3,316.9		$	2,327.3
Operating Income ($ mm)		$	456.1		$	326.7			$	464.4		$	376.4			$	1,102.4		$	526.4			$	1,138.4		$	639.3
Net Income Attributable to Evercore Inc. ($ mm)		$	295.9		$	220.4			$	338.3		$	277.4			$	740.1		$	350.6			$	843.2		$	459.6
Diluted Earnings Per Share		$	6.96		$	5.02			$	7.15		$	5.67			$	17.08		$	8.22			$	17.50		$	9.62
Compensation Ratio			50.1	%		54.8	%			49.7	%		52.3	%			56.2	%		60.6	%			55.7	%		58.9	%
Operating Margin			40.9	%		35.2	%			41.3	%		38.8	%			33.5	%		23.3	%			34.3	%		27.5	%
Effective Tax Rate			23.9	%		23.2	%			25.2	%		25.0	%			22.2	%		23.7	%			23.8	%		25.4	%

Business and Financial Highlights	■	Record Fourth Quarter and Full Year Net Revenues on a U.S. GAAP and an Adjusted basis; Full Year 2021 Net Revenues increased 45% and 43% on a U.S. GAAP and an Adjusted basis, respectively, versus the prior record in 2020
	■	Record Fourth Quarter and Full Year Operating Margins and Net Income on a U.S. GAAP and an Adjusted basis; Full Year 2021 Operating Margins on a U.S. GAAP and an Adjusted basis were 33.5% and 34.3%, respectively, an increase of 1,026 and 685 basis points, respectively, versus 2020; Full Year 2021 Net Income increased 111% and 83% on a U.S. GAAP and an Adjusted basis, respectively, versus 2020
	■	More than $2.7 billion in 2021 Advisory revenues, a 57% increase over 2020, with strong contribution across capabilities, regions and solid sector diversification
	■	Underwriting Revenue for the full year surpassed $200 million for the second year in a row; served as bookrunner on over 85% of transactions in 2021
	■	Evercore Wealth Management AUM surpassed $12 billion for the first time
	■	Strengthened our commitment to ESG efforts, establishing the Evercore Foundation which will focus on socially conscious causes that are important to our employees, our firm and our communities
Talent	■	Promoted 17 Advisory Managing Directors to Senior Managing Director in January 2022, reflecting the investments we have made in developing our own talent. Additionally, in Equity Research, we promoted one Global Autos and Auto Parts focused Analyst to Senior Managing Director
	■	Eight Advisory Senior Managing Directors joined Evercore in 2021, three of whom joined in the fourth quarter; Jon Kaufman, Ted Michaels and Ben Eldredge, strengthening our coverage in the Power and Renewables and Basic Materials sectors. As we continue to invest in our Equities business, we added two Senior Managing Directors in 2021, including Equity Strategist Julian Emanuel in the fourth quarter
	■	Two additional Advisory Senior Managing Directors joined Evercore in January; Takeshi Inoue, who will further build our Advisory footprint in Asia and David Lischer, who will enhance our Debt Advisory practice
	■	Dialogue with potential senior level talent remains robust and lateral hiring at other levels continues to be strong as we enter 2022
Capital Return	■	Quarterly dividend of $0.68 per share
	■	Returned $852.3 million to shareholders during 2021 through dividends and repurchases of 5.5 million shares at an average price of $132.10

Evercore Inc. (NYSE: EVR) today announced its results for the full year ended December 31, 2021.

LEADERSHIP COMMENTARY

John S. Weinberg, Co-Chairman and Co-Chief Executive Officer, “2021 was an extraordinary year for Evercore, showcasing the depth and diversity of our business. This, combined with the outstanding collaboration and teamwork across our firm and robust market activity, led to our record results for 2021, with Evercore exceeding $2.7 billion in Advisory revenues for the first time in our history and up 57% over last year. Over the past few years, we have invested significantly in our platform, both by attracting highly talented individuals and by adding to our broad and expanding platform of capabilities. We are thrilled to have recruited eight Senior Managing Directors in Advisory in 2021 and remain strongly committed to developing talent for internal promotion, recently announcing our largest promotion class ever. Further, as we continue to grow and invest in the firm, we remain committed to returning all capital not required to support our business to our shareholders.”

Ralph Schlosstein, Co-Chairman and Co-Chief Executive Officer, “We are executing on our long-term growth objectives by continuing to invest in building out the depth of our sector coverage, enhancing our capabilities, and widening the geographies we cover, while focusing intensely on clients, including financial sponsors. Our efforts are being recognized in our financial results, and in 2021, we ranked for the fourth consecutive year number four in advisory fees among all publicly traded investment banks.

With my upcoming transition to Chairman Emeritus in late February, I have been reflecting upon my last 13 years at the firm and take immense pride in the extraordinary growth of the firm and our dedication to excellence, our commitment to our people and the exemplary culture we have built. Our business continues to perform exceptionally well, and as we look ahead, the prospects for Evercore’s long term growth are very real and very exciting.”

Roger C. Altman, Founder and Senior Chairman, “Client support for Evercore’s values of integrity, excellence, discretion and clients first led to another record year for the firm amidst the continuing challenges of COVID. We are grateful to our clients, to all of our employees and, especially to our outgoing CEO, Ralph Schlosstein, for this special year.”

Evercore’s quarterly results may fluctuate significantly due to the timing and amount of transaction fees earned, as well as other factors. Accordingly, financial results in any particular quarter may not be representative of future results over a longer period of time.

Business Segments:

Evercore’s business results are categorized into two segments: Investment Banking and Investment Management. Investment Banking includes providing advice to clients on mergers, acquisitions, divestitures and other strategic corporate transactions, as well as services related to securities underwriting, private placement services and commissions for agency-based equity trading services and equity research. Investment Management includes Wealth Management and interests in private equity funds which are not managed by the Company, as well as advising third-party investors through affiliates and historically through Institutional Asset Management. See pages A-2 to A-10 for further information and reconciliations of these segment results to our U.S. GAAP consolidated results.

Non-GAAP Measures:

Throughout this release certain information is presented on an adjusted basis, which is a non-GAAP measure. Adjusted results begin with information prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), and then those results are adjusted to exclude certain items and reflect the conversion of certain Evercore LP Units into Class A shares. Evercore believes that the disclosed adjusted measures and any adjustments thereto, when presented in conjunction with comparable U.S. GAAP measures, are useful to investors to compare Evercore’s results across several periods and facilitate an understanding of Evercore’s operating results. Evercore uses these measures to evaluate its operating performance, as well as the performance of individual employees. These measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with U.S. GAAP.

Evercore’s Adjusted Net Income Attributable to Evercore Inc. for the three and twelve months ended December 31, 2021 was higher than U.S. GAAP as a result of certain business acquisition-related and disposition-related charges and Special Charges, Including Business Realignment Costs. Acquisition-related charges for 2021 include professional fees incurred. Special Charges, Including Business Realignment Costs, in 2021 relate to the write-down of certain assets associated with a legacy private equity investment relationship which, consistent with the Company’s current investment strategy, the Company decided to wind down during the third quarter of 2021.

The gain on the redemption of the G5 debt security in the second quarter of 2021 was excluded from Adjusted Net Revenues.

Evercore’s Adjusted Diluted Shares Outstanding for the three and twelve months ended December 31, 2021 were higher than U.S. GAAP, as a result of the inclusion of certain Evercore LP Units and Unvested Restricted Stock Units.

Further details of these adjustments, as well as an explanation of similar amounts for the three and twelve months ended December 31, 2020 are included in pages A-2 to A-10.

Selected Financial Data – U.S. GAAP Results

The following is a discussion of Evercore’s consolidated results on a U.S. GAAP basis. See pages A-6 to A-8 for our business segment results.

Net Revenues

	U.S. GAAP
	Three Months Ended										Twelve Months Ended
	December 31, 2021			December 31, 2020				% Change			December 31, 2021			December 31, 2020				% Change
	(dollars in thousands)
Investment Banking:
Advisory Fees	$	970,927		$	789,611			23	%		$	2,751,992		$	1,755,273			57	%
Underwriting Fees		65,019			95,009			(32	%)			246,705			276,191			(11	%)
Commissions and Related Revenue(1)		54,808			52,789			4	%			205,822			206,692			—	%
Investment Management:
Asset Management and Administration Fees		17,692			14,672			21	%			65,784			54,397			21	%
Other Revenue, net(1)(2)		7,323			(24,773	)		NM				19,196			(28,648	)		NM
Net Revenues	$	1,115,769		$	927,308			20	%		$	3,289,499		$	2,263,905			45	%
1. Certain balances in the prior period were reclassified to conform to their current presentation in this release. “Commissions and Related Fees” has been renamed to “Commissions and Related Revenue” and principal trading gains and losses from our institutional equities business have been reclassified from “Other Revenue, net” to “Commissions and Related Revenue.” For the three and twelve months ended December 31, 2020, this resulted in a reclassification of $0.4 million and $0.9 million, respectively, from “Other Revenue, net” to “Commissions and Related Revenue.” There was no impact on U.S. GAAP Net Revenues, Operating Income, Net Income or Earnings Per Share. See page A-3 for further information.
2. Other Revenue, net, for the three months ended December 31, 2020, includes a loss of $32.2 million resulting from the sale and wind-down of our businesses in Mexico, including $4.8 million related to the sale of our ECB business, as well as $27.4 million related to the release of cumulative foreign exchange losses. Other Revenue, net, for the twelve months ended December 31, 2020, includes a loss of $30.8 million resulting from the sale and wind-down of our businesses in Mexico, including a net loss of $3.4 million related to the sale of our ECB businesses, as well as $27.4 million related to the release of cumulative foreign exchange losses.

	Three Months Ended							Twelve Months Ended
	December 31, 2021		December 31, 2020		% Change			December 31, 2021		December 31, 2020		% Change
Total Number of Fees from Advisory Client Transactions(1)	320		324		(1	%)		797		687		16	%
Total Number of Fees of at Least $1 million from Advisory Client Transactions(1)	153		162		(6	%)		502		386		30	%
Total Number of Underwriting Transactions	23		40		(43	%)		117		118		(1	%)
Total Number of Underwriting Transactions as a Bookrunner	21		33		(36	%)		100		85		18	%
1. Includes Advisory and Underwriting Transactions.

	As of December 31,
	2021			2020			% Change
Assets Under Management ($ mm)(1)
Wealth Management(2)	$	12,184		$	10,163		20	%
Total Assets Under Management	$	12,184		$	10,163		20	%
1. Assets Under Management reflect end of period amounts from our consolidated Wealth Management business.
2. Assets Under Management includes Evercore assets which are managed by Evercore Wealth Management of $76.3 million and $76.4 million as of December 31, 2021 and 2020, respectively.

Advisory Fees – Fourth quarter Advisory Fees increased $181.3 million, or 23%, year-over-year, reflecting growth in fee size. Full year Advisory Fees increased $996.7 million, or 57%, year-over-year, reflecting an increase in the number of fees earned and growth in fee size.

Underwriting Fees – Fourth quarter Underwriting Fees decreased $30.0 million, or 32%, year-over-year, reflecting a decrease in the number of transactions we participated in. Full year Underwriting Fees decreased $29.5 million, or 11%, year-over-year, reflecting a decrease in the number of transactions we participated in, as well as a decrease in the relative fee size of our participation in those transactions, as we participated in several of the largest deals in our history in 2020.

Commissions and Related Revenue – Fourth quarter Commissions and Related Revenue increased $2.0 million, or 4%, year-over-year, primarily reflecting higher revenues from research subscriptions and convertible securities. Full year Commissions and Related Revenue decreased $0.9 million year-over-year, reflecting lower volatility and volumes compared to the prior year period.

Asset Management and Administration Fees – Fourth quarter Asset Management and Administration Fees increased $3.0 million, or 21%, year-over-year, driven by an increase in fees from Wealth Management clients as associated AUM increased 20%, primarily from market appreciation. Full year Asset Management and Administration Fees increased $11.4 million, or 21%, year-over-year, driven by an increase in fees from Wealth Management clients as associated AUM increased 20%, primarily from market appreciation.

Other Revenue – Fourth quarter Other Revenue, net, increased $32.1 million year-over-year, primarily driven by a loss of $32.2 million in 2020, resulting from the sale and wind-down of our businesses in Mexico. Full year Other Revenue, net, increased $47.8 million year-over-year, primarily driven by a loss of $30.8 million in 2020, resulting from the sale and wind-down of our businesses in Mexico, as well as higher performance of our investment funds portfolio and a gain on the redemption of the G5 debt security in 2021.

Expenses

	U.S. GAAP
	Three Months Ended											Twelve Months Ended
	December 31, 2021				December 31, 2020				% Change			December 31, 2021				December 31, 2020				% Change
	(dollars in thousands)
Employee Compensation and Benefits	$	559,098			$	507,739			10	%		$	1,848,757			$	1,372,339			35	%
Compensation Ratio		50.1	%			54.8	%						56.2	%			60.6	%
Non-Compensation Costs	$	100,607			$	85,823			17	%		$	329,750			$	318,488			4	%
Non-Compensation Ratio		9.0	%			9.3	%						10.0	%			14.1	%
Special Charges, Including Business Realignment Costs	$	—			$	7,031			NM			$	8,554			$	46,645			(82	%)

Employee Compensation and Benefits – Fourth quarter Employee Compensation and Benefits increased $51.4 million, or 10%, year-over-year. The fourth quarter compensation ratio was 50.1% versus 54.8% for the prior year period. Full year Employee Compensation and Benefits increased $476.4 million, or 35%, year-over-year. The full year compensation ratio was 56.2% versus 60.6% for the prior year period. The increase in the amount of compensation recognized in both the fourth quarter and full year principally reflects a higher accrual for incentive compensation, higher base salaries and higher amortization of prior period deferred compensation awards, as well as increased headcount year over year, each related to growth in the business. The decrease in the compensation ratio for both the fourth quarter and full year reflects leverage achieved on higher revenues. See “Deferred Compensation” for more information.

Non-Compensation Costs – Fourth quarter Non-Compensation Costs increased $14.8 million, or 17%, year-over-year, primarily driven by an increase in other operating expenses related to charitable contributions made to the Evercore Foundation (formed in 2021) and an increase in travel and related expenses, as travel began to resume during the quarter. The fourth quarter Non-Compensation ratio of 9.0% decreased from 9.3% for the prior year period. Full year Non-Compensation Costs increased $11.3 million, or 4%, year-over-year, primarily driven by increases in professional fees and charitable contributions made to the Evercore Foundation, partially offset by decreases in travel and related expenses and bad debt expense. The full year Non-Compensation ratio of 10.0% decreased from 14.1% for the prior year. The decrease in the Non-Compensation ratio for both the fourth quarter and full year principally reflects leverage achieved on higher revenues.

Special Charges, Including Business Realignment Costs – Full year 2021 Special Charges, Including Business Realignment Costs, relate to the write-down of certain assets associated with a legacy private equity investment relationship which, consistent with the Company’s current investment strategy, the Company decided to wind down during the third quarter of 2021.

In 2020, the Company completed a review of operations focused on markets, sectors and people which delivered lower levels of productivity in an effort to attain greater flexibility of operations and better position itself for future growth. This review generated reductions of approximately 8% of our headcount.

In conjunction with the employment reductions, the Company incurred separation and transition benefits and related costs for certain employees terminated as a result of the Company’s review of its operations of $4.1 million and $41.7 million for fourth quarter and full year 2020, respectively, which have been recorded as Special Charges, Including Business Realignment Costs, and are excluded from our Adjusted results.

Fourth quarter and full year 2020 Special Charges, Including Business Realignment Costs, also reflect the acceleration of depreciation expense for leasehold improvements and certain other fixed assets in conjunction with the expansion of our headquarters in New York and our business realignment initiatives of $1.3 million and $3.3 million, respectively, and charges related to the impairment of assets resulting from the wind-down of our Mexico business of $1.7 million.

Effective Tax Rate

The fourth quarter effective tax rate was 23.9% versus 23.2% for the prior year period. The full year effective tax rate was 22.2% versus 23.7% for the prior year period. The effective tax rate is principally impacted by the deduction associated with the appreciation or depreciation in the Firm’s share price upon vesting of employee share-based awards above or below the original grant price. The full year provision for income taxes for 2021 reflects an additional tax benefit of $18.7 million versus an additional tax expense of $0.02 million for the prior year period, due to the net impact associated with the appreciation or depreciation in our share price upon vesting of employee share-based awards above or below the original grant price.

Selected Financial Data – Adjusted Results

The following is a discussion of Evercore’s consolidated results on an Adjusted basis. See pages 3 and A-2 to A-10 for further information and reconciliations of these metrics to our U.S. GAAP results. See pages A-6 to A-8 for our business segment results.

Adjusted Net Revenues

	Adjusted
	Three Months Ended									Twelve Months Ended
	December 31, 2021			December 31, 2020			% Change			December 31, 2021			December 31, 2020			% Change
	(dollars in thousands)
Investment Banking:
Advisory Fees(1)	$	970,982		$	789,986		23	%		$	2,753,329		$	1,756,819		57	%
Underwriting Fees		65,019			95,009		(32	%)			246,705			276,191		(11	%)
Commissions and Related Revenue(2)		54,808			52,789		4	%			205,822			206,692		—	%
Investment Management:
Asset Management and Administration Fees(3)		21,699			20,143		8	%			78,608			67,249		17	%
Other Revenue, net(2)		11,640			11,991		(3	%)			32,408			20,355		59	%
Net Revenues	$	1,124,148		$	969,918		16	%		$	3,316,872		$	2,327,306		43	%
1. Advisory Fees on an Adjusted basis reflect the reclassification of earnings related to our equity method investment in Luminis and Seneca Evercore of $0.1 million and $1.3 million for the three and twelve months ended December 31, 2021, respectively, and $0.4 million and $1.5 million for the three and twelve months ended December 31, 2020, respectively.
2. Certain balances in the prior period were reclassified to conform to their current presentation in this release. “Commissions and Related Fees” has been renamed to “Commissions and Related Revenue” and principal trading gains and losses from our institutional equities business have been reclassified from “Other Revenue, net” to “Commissions and Related Revenue.” For the three and twelve months ended December 31, 2020, this resulted in a reclassification of $0.4 million and $0.9 million, respectively, from “Other Revenue, net” to “Commissions and Related Revenue.” There was no impact on Adjusted Net Revenues, Operating Income, Net Income or Earnings Per Share. See page A-3 for further information.
3. Asset Management and Administration Fees on an Adjusted basis reflect the reclassification of earnings related to our equity method investments in Atalanta Sosnoff and ABS of $4.0 million and $12.8 million for the three and twelve months ended December 31, 2021, respectively, and $5.5 million and $12.9 million for the three and twelve months ended December 31, 2020, respectively.

See page 4 for additional business metrics.

Advisory Fees – Fourth quarter adjusted Advisory Fees increased $181.0 million, or 23%, year-over-year, reflecting growth in fee size. Full year adjusted Advisory Fees increased $996.5 million, or 57%, year-over-year, reflecting an increase in the number of Advisory fees earned and growth in fee size.

Underwriting Fees – Fourth quarter Underwriting Fees decreased $30.0 million, or 32%, year-over-year, reflecting a decrease in the number of transactions we participated in. Full year Underwriting Fees decreased $29.5 million, or 11%, year-over-year, reflecting a decrease in the number of transactions we participated in, as well as a decrease in the relative fee size of our participation in those transactions, as we participated in several of the largest deals in our history in 2020.

Commissions and Related Revenue – Fourth quarter Commissions and Related Revenue increased $2.0 million, or 4%, year-over-year, primarily reflecting higher revenues from research subscriptions and convertible securities. Full year Commissions and Related Revenue decreased $0.9 million year-over-year, reflecting lower volatility and volumes compared to the prior year period.

Asset Management and Administration Fees – Fourth quarter adjusted Asset Management and Administration Fees increased $1.6 million, or 8%, year-over-year, primarily driven by an increase in fees from Wealth Management clients, as associated AUM increased 20%, primarily from market appreciation. This was partially offset by a 27% decrease in equity in earnings of affiliates, driven by lower income earned by ABS and Atalanta Sosnoff during the quarter. Full year adjusted Asset Management and Administration Fees increased $11.

Contacts

Investor Contact:

Investor Relations

[email protected]

Media Contact:
Dana Gorman

Abernathy MacGregor, for Evercore

212-371-5999

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