Company Announcements

• Firm-wide adjusted net revenue increased 24% year-to-date
• Financial Advisory adjusted net revenue increased 39% year-to-date
• Asset Management AUM increased 8% from last year

NEW YORK--(BUSINESS WIRE)--Oct. 31, 2024-- Lazard, Inc. (NYSE: LAZ) today reported net revenue of $785 million and adjusted net revenue¹ of $646 million for the quarter ended September 30, 2024. For the first nine months of 2024, Lazard reported net revenue of $2,235 million and adjusted net revenue¹ of $2,077 million.

On a U.S. GAAP basis, Lazard reported third-quarter 2024 net income of $108 million or $1.02 per share, diluted. For the first nine months of 2024, net income was $194 million or $1.88 per share, diluted. For the third quarter of 2024, adjusted net income¹ was $40 million or $0.38 per share, diluted. For the first nine months of 2024, adjusted net income¹ was $159 million or $1.54 per share, diluted.

“Lazard’s growth strategy continues to gain momentum, with Financial Advisory revenue up 39 percent for the first nine months of this year, 16 new Managing Directors hired year-to-date and our work with private capital expanding,” said Peter R. Orszag, Chief Executive Officer, Lazard. “Asset Management delivered another solid quarter, providing a durable source of revenue for the firm, with assets under management increasing more than 8 percent from a year ago. Lazard’s unique insights into business and geopolitical issues continue to position us well to serve clients and deliver long-term shareholder value.”

NET REVENUE

Financial Advisory

For the third quarter of 2024, Financial Advisory reported net revenue and adjusted net revenue¹ of $371 million and $369 million, 39% and 41% higher than the third quarter of 2023, respectively.

For the first nine months of 2024, Financial Advisory reported net revenue and adjusted net revenue¹ of $1,236 million and $1,223 million, 38% and 39% higher than the first nine months of 2023, respectively.

During and since the third quarter of 2024, Lazard has been engaged in significant and complex M&A transactions globally, including the following (clients are in italics): Kellanova’s$35.9 billion acquisition by Mars; TPG’s €6.7 billion acquisition of Techem with GIC; KPS Capital Partners’ €3.5 billion acquisition of Innomotics from Siemens AG; Vitesco Technologies’ €3.0 billion merger with Schaeffler; Carlyle’s $3.0 billion sale of Cogentrix to Quantum Capital; Air Products & Chemicals’$1.8 billion sale of its LNG business to Honeywell International Inc.; Macquarie Asset Management’s announced agreement to invest up to $1.725 billion in DE Shaw Renewable Investments; Cupertino Electric’s$1.5 billion acquisition by Quanta Services; Siete Foods’$1.2 billion acquisition by PepsiCo; Tellurian’s$1.2 billion acquisition by Woodside Energy; Calliditas Therapeutics’ sale to Asahi Kasei for $1.1 billion; Sofidel’s $1.1 billion agreement to acquire Clearwater Paper Corporation’s Tissue Business; Mallinckrodt’s$925 million sale of its Therakos business to CVC Capital Partners; Collegium Pharmaceutical’s$550 million acquisition of Ironshore Therapeutics; Seres Therapeutics’$505 million sale of its VOWST business to Nestle Health Science; EIG and West Burton Energy’s £450 million sale of is operational CCGT and BESS to TotalEnergies; UCB’s $680 million sale of its neurology and allergy business in China to CBC and Mubadala Investment Company; AffiniPay’s investment from Genstar Capital; Cemex’s sales of its operations in the Dominican Republic and the Philippines; CVC Capital Partners’ investment in Hempel; GenServe’s acquisition by Aurora Capital Partners; Parker Hannifin’s sale of its North America Composites and Fuel Containment Division to SK Capital Partners and Terra-Gen’s sale of a 50% stake in the company previously held by Energy Capital Partners to Masdar.

Lazard’s preeminent restructuring and liability management practice has been engaged in a broad range of complex restructuring and debt advisory assignments, including company roles involving Belk, Consolis, Enviva, LivePerson and Zachry Group and creditor and/or related party roles involving Accuride, KLDiscovery, Rite Aid, SIRVA, SVB Financial Group and Wheel Pros.

Our capital advisory and solutions practices remain active and engaged in assignments, including Altamont Capital Partners’ successful continuation fund vehicle with Tacala; Astorg Partners’ €1.4 billion continuation fund to support Normec; GHK Capital Partners’ closing of its $870 million Fund II; Health Catalyst’s $225 million term loan provided by Silver Point Finance; Hidden Harbour Capital Partners’ closing of its $800 million Fund III; Kingswood Capital Management’s closing of its $1.5 billion Fund III; Kohlberg & Company’s closing of its $4.3 billion fund for Kohlberg Investors X; Ocado’s £1.0 billion capital raise; Phoenix Equity Partners’ £200 million continuation fund and Pure Fishing, a portfolio company of Sycamore Partners, on its $750 million term loan to refinance existing debt provided by Monarch Alternative Capital LP and Silver Point Finance. Our sovereign advisory practice continues to be active in advising governments and sovereign entities across developed and emerging markets.

For a list of publicly announced transactions please visit our website.

Asset Management

For the third quarter of 2024, Asset Management net revenue and adjusted net revenue¹ were $294 million and $272 million, 3% and 4% higher than the third quarter of 2023, respectively.

Management fees and other revenue, on an adjusted basis¹, were $269 million for the third quarter of 2024, 3% and 2% higher than the third quarter of 2023 and second quarter of 2024, respectively.

Incentive fees on an adjusted basis¹, were $3 million for the third quarter of 2024, compared to $2 million for the third quarter of 2023.

Average assets under management (AUM) was $246 billion for the third quarter of 2024, 4% higher than the third quarter of 2023, and in line with the second quarter of 2024.

For the first nine months of 2024, Asset Management net revenue and adjusted net revenue¹ were $875 million and $813 million, respectively, both 2% higher than the first nine months of 2023.

Management fees and other revenue, on an adjusted basis¹, were $799 million for the first nine months of 2024, 2% higher than the first nine months of 2023.

Incentive fees on an adjusted basis¹, were $13 million for the first nine months of 2024, compared to $14 million for the first nine months of 2023.

Average AUM for the first nine months of 2024 was $246 billion, 6% higher than the first nine months of 2023. AUM as of September 30, 2024, was $248 billion, 1% and 8% higher than June 30, 2024 and September 30, 2023, respectively. The sequential change from June 30, 2024 was driven by market appreciation of $9.4 billion, foreign exchange appreciation of $6.0 billion and net outflows of $12.4 billion.

Corporate

For the third quarter of 2024, Corporate net revenue and adjusted net revenue¹ were $120 million and $6 million, respectively. For the first nine months of 2024, Corporate net revenue and adjusted net revenue¹ were $124 million and $41 million, respectively. On a U.S. GAAP basis, revenue in both periods includes $114 million related to the sale of an office building no longer occupied by Lazard, which resulted in net income of $68 million, or $0.65 per share, diluted², for the third quarter of 2024, and $0.67 per share, diluted², for the first nine months of 2024.

OPERATING EXPENSES

Compensation and Benefits Expense

For the third quarter of 2024, compensation and benefits expense on a U.S. GAAP and adjusted basis¹ were $465 million and $426 million, respectively, compared to $365 million and $364 million, respectively, for the third quarter of 2023. The adjusted compensation ratio³ for the third quarter of 2024 was 66.0%, compared to the third-quarter 2023 ratio of 68.4%.

For the first nine months of 2024, compensation and benefits expense on a U.S. GAAP and adjusted basis¹ were $1,469 million and $1,371 million, respectively, compared to $1,387 million and $1,187 million, respectively, for the first nine months of 2023.

We focus on the adjusted compensation ratio to manage costs, balancing a view of current conditions in the market for talent alongside our objective to drive long-term shareholder value. Our goal remains to deliver an adjusted compensation ratio over the cycle in the mid- to high-50s percentage range, while targeting a consistent deferral policy.

Non-Compensation Expenses

For the third quarter of 2024, non-compensation expenses on a U.S. GAAP basis were $158 million, 4% lower than the third quarter of 2023. On an adjusted basis¹, non-compensation expenses were $138 million, up less than 1% from the third quarter of 2023.

The adjusted non-compensation ratio⁴ was 21.4% for the third quarter of 2024, compared to 25.9% for the third quarter of 2023.

For the first nine months of 2024, non-compensation expenses on a U.S. GAAP and adjusted basis¹ were $487 million and $421 million, respectively, 5% and 1% lower than the first nine months of 2023, respectively.

The adjusted non-compensation ratio⁴ was 20.3% for the first nine months of 2024, compared to 25.2% for the first nine months of 2023.

Our goal remains to deliver an adjusted non-compensation ratio between 16% to 20% over the cycle.

TAXES

The provisions for income taxes, on a U.S. GAAP and adjusted basis¹ were $45 million and $19 million, respectively, for the third quarter of 2024. The effective tax rate on an adjusted basis¹ was 32.5% for the third quarter of 2024, compared to 8.4% for the third quarter of 2023.

The provisions for income taxes, on a U.S. GAAP and adjusted basis¹ were $71 million and $60 million, respectively, for the first nine months of 2024. The effective tax rate on an adjusted basis¹ was 27.4% for the first nine months of 2024, compared to 3.9% for the first nine months of 2023.

CAPITAL MANAGEMENT AND BALANCE SHEET

In the third quarter of 2024, Lazard returned $51 million to shareholders, which included: $45 million in dividends; $3 million in share repurchases of our common stock; and $3 million in satisfaction of employee tax obligations in lieu of share issuances upon vesting of equity grants.

In the first nine months of 2024, Lazard returned $242 million to shareholders, which included: $134 million in dividends; $44 million in share repurchases of our common stock; and $64 million in satisfaction of employee tax obligations in lieu of share issuances upon vesting of equity grants.

During the first nine months of 2024, we repurchased 1.1 million shares at an average price of $39.10. Our total outstanding share repurchase authorization is approximately $356 million.

On October 30, 2024, Lazard declared a quarterly dividend of $0.50 per share on its outstanding common stock. The dividend is payable on November 15, 2024, to stockholders of record on November 8, 2024.

Lazard’s financial position remains strong. As of September 30, 2024, our cash and cash equivalents were $1,166 million.

ENDNOTES

Beginning in the first quarter of 2024, Lazard has updated the names of certain non-U.S. GAAP (“non-GAAP”) measures and metrics. The nomenclature change did not result in any change to the components of our non-GAAP measures and metrics compared to prior periods. Reconciliations of U.S. GAAP to Adjusted results are shown on pages 13-15.

CONFERENCE CALL

Lazard will host a conference call at 8:00 a.m. ET on October 31, 2024, to discuss the company’s financial results for the third quarter and first nine months of 2024. The conference call can be accessed via a live audio webcast available through Lazard’s Investor Relations website at www.lazard.com, or by dialing +1 800-445-7795 (toll-free, U.S. and Canada) or +1 785-424-1699 (outside of the U.S. and Canada), 15 minutes prior to the start of the call. Conference ID: LAZQ324.

A replay of the conference call will be available by 10:00 a.m. ET, October 31, 2024, via the Lazard Investor Relations website at www.lazard.com, or by dialing +1 800-839-8317 (toll-free, U.S. and Canada) or +1 402-220-6070 (outside of the U.S. and Canada).

ABOUT LAZARD

Founded in 1848, Lazard is one of the world’s preeminent financial advisory and asset management firms, with operations in North and South America, Europe, Middle East, Asia, and Australia. Lazard provides advice on mergers and acquisitions, capital markets and capital solutions, restructuring and liability management, geopolitics, and other strategic matters, as well as asset management and investment solutions to institutions, corporations, governments, partnerships, family offices, and high net worth individuals. For more information, please visit www.lazard.com.

Cautionary Note Regarding Forward-Looking Statements:

This press release contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. In some cases, forward-looking statements can be identified by the use of forward-looking terminology such as “may,” “might,” “will,” “should,” “could,” “would,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “target,” “goal,” or “continue,” and the negative of these terms and other comparable terminology. These forward-looking statements, which are subject to known and unknown risks, uncertainties and assumptions about us, may include projections of our future financial performance based on our growth strategies, business plans and initiatives and anticipated trends in our business. These forward-looking statements are only predictions based on our current expectations and projections about future events. There are important factors that could cause our actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements.

These factors include, but are not limited to, those discussed in our Annual Report on Form 10-K under Item 1A “Risk Factors,” and also discussed from time to time in our Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, including the following:

• Adverse general economic conditions or adverse conditions in global or regional financial markets;
• A decline in our revenues, for example due to a decline in overall mergers and acquisitions (M&A) activity, our share of the M&A market or our assets under management (AUM);
• Losses caused by financial or other problems experienced by third parties;
• Losses due to unidentified or unanticipated risks;
• A lack of liquidity, i.e., ready access to funds, for use in our businesses;
• Competitive pressure on our businesses and on our ability to retain and attract employees at current compensation levels; and
• Changes in relevant tax laws, regulations or treaties or an adverse interpretation of those items.

These risks and uncertainties are not exhaustive. Our SEC reports describe additional factors that could adversely affect our business and financial performance. Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible for our management to predict all risks and uncertainties, nor can management assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.

As a result, there can be no assurance that the forward-looking statements included in this release will prove to be accurate or correct. Although we believe the statements reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance, achievements or events. Moreover, neither we nor any other person assumes responsibility for the accuracy or completeness of any of these forward-looking statements. You should not rely upon forward-looking statements as predictions of future events. We are under no duty to update any of these forward-looking statements after the date of this release to conform our prior statements to actual results or revised expectations and we do not intend to do so.

Lazard, Inc. is committed to providing timely and accurate information to the investing public, consistent with our legal and regulatory obligations. To that end, Lazard and its operating companies use their websites, and other social media sites to convey information about their businesses, including the anticipated release of quarterly financial results, quarterly financial, statistical and business-related information, and the posting of updates of assets under management in various mutual funds, hedge funds and other investment products managed by Lazard Asset Management LLC and Lazard Frères Gestion SAS. Investors can link to Lazard and its operating company websites through www.lazard.com.

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LAZ-EPE

Note: For the three month periods ended September 30, 2024, June 30, 2024 and September 30, 2023, Financial Advisory net revenue was $370,917, $411,308 and $266,048, respectively; Asset Management net revenue was $293,878, $285,487 and $284,855, respectively; Corporate net revenue (loss) was $120,071, ($11,446) and ($26,985), respectively.

Note: For the nine month periods ended September 30, 2024 and September 30, 2023, Financial Advisory net revenue was $1,235,732 and $896,099, respectively; Asset Management net revenue was $874,841 and $857,212, respectively; Corporate net revenue (loss) was $124,395 and ($43,843), respectively.

Note: “Property” includes $73 million of property held for sale at December 31, 2023 which was sold in July 2024.

This presentation includes non-GAAP measures. Our non-GAAP measures are not meant to be considered in isolation or as a substitute for the corresponding U.S. GAAP measures and should be read only in conjunction with our consolidated financial statements prepared in accordance with U.S. GAAP. For a detailed explanation of the adjustments made to the corresponding U.S. GAAP measures, see Reconciliation of U.S. GAAP to Selected Summary Financial Information and Notes to Financial Schedules.

This presentation includes non-GAAP measures. Our non-GAAP measures are not meant to be considered in isolation or as a substitute for the corresponding U.S. GAAP measures and should be read only in conjunction with our consolidated financial statements prepared in accordance with U.S. GAAP. For a detailed explanation of the adjustments made to the corresponding U.S. GAAP measures, see Reconciliation of U.S. GAAP to Selected Summary Financial Information and Notes to Financial Schedules.

Note: Average AUM generally represents the average of the monthly ending AUM balances for the period.

This presentation includes non-GAAP measures. Our non-GAAP measures are not meant to be considered in isolation or as a substitute for the corresponding U.S. GAAP measures and should be read only in conjunction with our consolidated financial statements prepared in accordance with U.S. GAAP. For a detailed explanation of the adjustments made to the corresponding U.S. GAAP measures, see Notes to Financial Schedules.