Houlihan Lokey, Inc. (HLI) Bundle
A Brief History of Houlihan Lokey
Founded in 1972, Houlihan Lokey has established itself as a global investment bank specializing in capital markets and financial advisory services. The firm has grown significantly through a combination of organic growth and strategic acquisitions, positioning itself as a leader in the advisory space.
Recent Financial Performance
As of September 30, 2024, Houlihan Lokey reported revenues of $1.09 billion for the six months ended September 30, 2024, compared to $882.8 million for the same period in 2023, marking a 23% increase. This growth was primarily driven by strong performance in their Corporate Finance and Financial Restructuring segments.
| Financial Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Revenues | $574.96 million | $466.99 million | 23% |
| Net Income | $93.55 million | $67.03 million | 40% |
| Operating Expenses | $444.29 million | $376.71 million | 18% |
| Segment Profit | $189.96 million | $142.61 million | 33% |
Segment Performance
In the Corporate Finance segment, revenues reached $692.4 million for the six months ended September 30, 2024, up from $508.7 million in the prior year, a 36% increase. Segment profit also rose to $210.1 million, reflecting a 38% increase year-over-year.
The Financial Restructuring segment saw revenues of $249.0 million, a modest increase of 5% from $238.0 million in 2023, while segment profit increased by 32% to $100.1 million.
| Segment | Revenues (6M 2024) | Revenues (6M 2023) | Change (%) | Segment Profit (6M 2024) | Segment Profit (6M 2023) | Change (%) |
|---|---|---|---|---|---|---|
| Corporate Finance | $692.45 million | $508.74 million | 36% | $210.08 million | $152.14 million | 38% |
| Financial Restructuring | $248.99 million | $238.04 million | 5% | $100.07 million | $76.09 million | 32% |
| Financial and Valuation Advisory | $147.13 million | $136.05 million | 8% | $37.03 million | $34.49 million | 7% |
Market Position and Strategic Initiatives
Houlihan Lokey continues to expand its market position through strategic initiatives and a focus on high-demand sectors. The firm has maintained a strong presence in both domestic and international markets, with significant contributions from their advisory services, particularly in mergers and acquisitions.
As of September 30, 2024, the firm reported total assets of $3.21 billion, reflecting a steady growth trajectory. The firm's liquidity position remains robust, with cash and cash equivalents totaling $691.41 million, alongside investment securities worth $56.83 million.
Stockholder Equity and Share Performance
As of September 30, 2024, Houlihan Lokey had a total stockholders' equity of $1.96 billion, with 53,403,939 shares of Class A common stock and 16,082,738 shares of Class B common stock outstanding. The firm’s earnings per share (EPS) for the six months ended September 30, 2024, were reported at $2.79 on a basic basis and $2.67 on a diluted basis.
| Stockholder Equity Metric | Amount |
|---|---|
| Total Stockholders' Equity | $1.96 billion |
| Class A Common Shares Outstanding | 53,403,939 |
| Class B Common Shares Outstanding | 16,082,738 |
| Basic EPS | $2.79 |
| Diluted EPS | $2.67 |
Conclusion of Financial Overview
Houlihan Lokey's continued growth and strong financial performance highlight its strategic positioning in the investment banking sector. The firm's focus on enhancing its service offerings and expanding its geographical reach has positioned it well for future opportunities.
A Who Owns Houlihan Lokey, Inc. (HLI)
Ownership Structure
As of September 30, 2024, Houlihan Lokey, Inc. has two classes of common stock: Class A and Class B. The ownership distribution is as follows:
| Class of Stock | Shares Outstanding | Voting Rights | Ownership |
|---|---|---|---|
| Class A Common Stock | 53,334,156 | 1 vote per share | Public and non-employee directors |
| Class B Common Stock | 16,082,738 | 10 votes per share | HL Voting Trust |
Major Shareholders
The following entities are the major shareholders of Houlihan Lokey, Inc. as of September 30, 2024:
| Shareholder | Class of Stock | Shares Held | Percentage Ownership |
|---|---|---|---|
| HL Voting Trust | Class B | 16,082,738 | 30.0% |
| Public Investors | Class A | 53,334,156 | 70.0% |
| Non-Employee Directors | Class A | 69,783 | 0.1% |
Institutional Ownership
As of September 30, 2024, institutional ownership of Houlihan Lokey, Inc. is as follows:
| Institution | Shares Held | Percentage of Total Shares |
|---|---|---|
| BlackRock, Inc. | 6,500,000 | 10.9% |
| The Vanguard Group | 5,800,000 | 9.7% |
| State Street Corporation | 4,200,000 | 7.0% |
| Other Institutions | 10,000,000 | 16.6% |
Recent Developments in Share Ownership
In the last fiscal year, there have been several conversions and issuances of shares:
- 350,440 shares converted from Class B to Class A in Q3 2024.
- 5,248 shares issued to non-employee directors in Q3 2024.
- 1,248,217 shares were issued as part of stock compensation during Q2 2024.
Dividends and Share Repurchase Program
As of September 30, 2024, Houlihan Lokey has a share repurchase program in place:
| Program Details | Amount Authorized | Amount Remaining |
|---|---|---|
| Share Repurchase Program | $500 million | $457.7 million |
Dividends declared in Q4 2024 amount to $0.57 per share for both Class A and Class B common stock, payable on December 15, 2024.
Houlihan Lokey, Inc. (HLI) Mission Statement
Mission Statement Overview
The mission statement of Houlihan Lokey, Inc. emphasizes its commitment to providing exceptional financial advisory services, focusing on integrity, collaboration, and superior outcomes for clients. The firm aims to deliver high-quality, independent advice tailored to meet the unique needs of each client.
Key Elements of the Mission Statement
- Client-Centric Approach: Prioritizing the interests of clients in every engagement.
- Excellence in Advisory Services: Delivering top-tier financial solutions across various sectors.
- Integrity and Trust: Building long-term relationships based on transparency and ethical practices.
- Innovation: Adapting to changing market conditions and client needs through innovative solutions.
Financial Performance Indicators
As of September 30, 2024, Houlihan Lokey reported significant financial growth, reflecting the effectiveness of its mission-driven approach. The following table summarizes key financial metrics:
| Financial Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Revenues | $575.0 million | $467.0 million | 23% |
| Net Income | $93.5 million | $67.0 million | 40% |
| Operating Income | $130.7 million | $90.3 million | 45% |
| Operating Expenses | $444.3 million | $376.7 million | 18% |
| Employee Compensation and Benefits | $360.6 million | $296.5 million | 22% |
Segments and Revenue Contributions
The revenue contributions by segment for the six months ended September 30, 2024, are detailed below:
| Segment | Revenue (in millions) | Change (%) |
|---|---|---|
| Corporate Finance | $692.4 | 36% |
| Financial Restructuring | $249.0 | 5% |
| Financial and Valuation Advisory | $147.1 | 8% |
Market Presence and Strategy
Houlihan Lokey operates in a competitive landscape, focusing on strategic growth through mergers and acquisitions, enhancing its service offerings, and expanding its global footprint. The firm invests in technology and talent to maintain its competitive edge and continuously innovate its advisory services.
Conclusion on Mission Alignment
The alignment of Houlihan Lokey’s mission statement with its financial performance and strategic initiatives reflects a robust commitment to delivering value to clients and stakeholders. The firm's ability to adapt to market demands while maintaining high ethical standards is pivotal to its ongoing success.
How Houlihan Lokey, Inc. (HLI) Works
Business Overview
Houlihan Lokey, Inc. operates as a global investment bank, focusing on financial advisory services, including mergers and acquisitions, capital markets, financial restructuring, and valuation. The firm is structured into three main business segments: Corporate Finance (CF), Financial Restructuring (FR), and Financial and Valuation Advisory (FVA).
Financial Performance
For the three months ended September 30, 2024, Houlihan Lokey reported revenues of $575.0 million, an increase of 23% from $467.0 million in the same period in 2023. For the six months ended September 30, 2024, revenues were $1,088.6 million, also reflecting a 23% increase from $882.8 million in 2023.
Operating Expenses
Operating expenses for the three months ended September 30, 2024, were $444.3 million, up 18% from $376.7 million in 2023. Employee compensation and benefits accounted for $360.6 million of operating expenses, a 22% increase from $296.5 million in the prior year.
Net Income
The net income attributable to Houlihan Lokey for the three months ended September 30, 2024, was $93.5 million, representing a 40% increase from $67.0 million in 2023. For the six-month period, net income was $182.5 million, a 42% increase from $128.4 million in 2023.
Earnings Per Share
Basic earnings per share for the three months ended September 30, 2024, were $1.42, compared to $1.04 in 2023. For the six months, basic earnings per share rose to $2.79 from $2.00.
Segment Performance
- Corporate Finance (CF): Revenues for CF were $364.0 million for the three months ended September 30, 2024, up 29% from $281.7 million in 2023.
- Financial Restructuring (FR): Revenues for FR were $131.6 million for the three months ended September 30, 2024, an increase of 15% from $114.7 million in 2023.
- Financial and Valuation Advisory (FVA): Revenues for FVA were $79.4 million for the three months ended September 30, 2024, a 12% increase from $70.6 million in 2023.
Cash Flow and Liquidity
As of September 30, 2024, Houlihan Lokey reported cash and cash equivalents of $691.4 million and investment securities totaling $56.8 million, leading to total unrestricted cash and cash equivalents of $748.2 million.
Balance Sheet Highlights
| Item | September 30, 2024 | March 31, 2024 |
|---|---|---|
| Cash and Cash Equivalents | $691,410 | $721,235 |
| Investment Securities | $56,829 | $38,005 |
| Total Unrestricted Cash and Cash Equivalents | $748,239 | $759,240 |
| Restricted Cash | $1,452 | $619 |
| Total Cash, Cash Equivalents, and Restricted Cash | $749,691 | $759,859 |
Debt and Financing
The firm maintains a revolving line of credit of up to $100 million, with an uncommitted expansion option that could increase the facility to $200 million. As of September 30, 2024, no principal was outstanding under this line of credit.
Market Position and Strategy
Houlihan Lokey's growth strategy focuses on enhancing its service offerings in the financial advisory sector, capitalizing on favorable market conditions, and maintaining robust client relationships. The firm continues to invest in technology and human capital to support its expansion efforts.
Employee Compensation
For the three months ended September 30, 2024, total employee compensation expenses amounted to $360.6 million, with a compensation ratio of 62.7%.
Comprehensive Income
Comprehensive income attributable to Houlihan Lokey for the three months ended September 30, 2024, was $124.9 million, compared to $47.1 million in 2023.
How Houlihan Lokey, Inc. (HLI) Makes Money
Revenue Streams
Houlihan Lokey generates revenue through three main business segments:
- Corporate Finance
- Financial Restructuring
- Financial and Valuation Advisory
Financial Performance
For the three months ended September 30, 2024, Houlihan Lokey reported:
| Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Revenues | $574.96 million | $466.99 million | 23% |
| Operating Expenses | $444.29 million | $376.71 million | 18% |
| Operating Income | $130.67 million | $90.28 million | 45% |
| Net Income | $93.55 million | $67.03 million | 40% |
Segment Revenue Breakdown
For the three months ended September 30, 2024, revenues by segment were as follows:
| Segment | Q3 2024 Revenue | Q3 2023 Revenue | Change (%) |
|---|---|---|---|
| Corporate Finance | $364.03 million | $281.68 million | 29% |
| Financial Restructuring | $131.57 million | $114.67 million | 15% |
| Financial and Valuation Advisory | $79.36 million | $70.64 million | 12% |
Year-to-Date Financial Overview
For the six months ended September 30, 2024, the financial overview is as follows:
| Metric | 6M 2024 | 6M 2023 | Change (%) |
|---|---|---|---|
| Revenues | $1.09 billion | $882.82 million | 23% |
| Operating Expenses | $862.33 million | $719.19 million | 20% |
| Net Income | $182.49 million | $128.42 million | 42% |
Operating Expenses Analysis
For the three months ended September 30, 2024, operating expenses breakdown:
| Expense Type | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Employee Compensation and Benefits | $360.64 million | $296.54 million | 22% |
| Non-Compensation Expenses | $83.65 million | $80.17 million | 4% |
Geographical Revenue Distribution
For the three months ended September 30, 2024, revenues by geography were as follows:
| Region | Q3 2024 Revenue | Q3 2023 Revenue |
|---|---|---|
| United States | $435.32 million | $328.96 million |
| International | $139.64 million | $138.03 million |
Key Financial Ratios
The following key financial ratios for the six months ended September 30, 2024:
| Ratio | Value |
|---|---|
| Compensation Ratio | 63.5% |
| Effective Tax Rate | 22.7% |
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Resources:
- Houlihan Lokey, Inc. (HLI) Financial Statements – Access the full quarterly financial statements for Q2 2025 to get an in-depth view of Houlihan Lokey, Inc. (HLI)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Houlihan Lokey, Inc. (HLI)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.