pjt-ex991

New York, July 30, 2019: PJT Partners Inc. (the “Company” or “PJT Partners”) (NYSE: PJT) today reported Total Revenues of $166.7 million for second quarter 2019 compared with $130.7 million for the prior year quarter. GAAP Net Income and Adjusted Net Income, If-Converted were $10.0 million and $21.0 million, respectively, for the current quarter compared with $11.0 million and $16.7 million, respectively, for the prior year quarter. GAAP Diluted EPS and Adjusted EPS were $0.20 and $0.51, respectively, for the current quarter compared with $0.30 and $0.42, respectively, for the prior year quarter.

Total Revenues for the six months ended June 30, 2019 were $294.8 million compared with $264.7 million for 2018. GAAP Net Income and Adjusted Net Income, If-Converted were $11.0 million and $32.4 million, respectively, for the six months compared with $17.7 million and $33.7 million, respectively, for 2018. GAAP Diluted EPS and Adjusted EPS were $0.24 and $0.79, respectively, for the six months compared with $0.55 and $0.89, respectively, for 2018.

The following table sets forth revenues for the three and six months ended June 30, 2019 and 2018:

	Three Months Ended June 30,							Six Months Ended June 30,
	2019		2018		% Change			2019		2018		% Change
	(Dollars in Millions)
Revenues
Advisory	$	133.0	$	98.3		35	%	$	237.5	$	201.8		18	%
Placement		28.7		28.1		2	%		52.0		54.3		(4	%)
Interest Income & Other		5.0		4.2		17	%		5.3		8.7		(40	%)
Total Revenues	$	166.7	$	130.7		28	%	$	294.8	$	264.7		11	%

Total Revenues were $166.7 million for second quarter 2019 compared with $130.7 million for the prior year quarter, an increase of 28%.

Advisory Revenues were $133.0 million for the current quarter compared with $98.3 million for the prior year quarter, an increase of 35%. The increase in Advisory Revenues was driven by growth in our strategic advisory and restructuring and special situations businesses.

Placement Revenues were $28.7 million for the current quarter, marginally higher compared with the prior year quarter.

Interest Income & Other was $5.0 million for the current quarter compared with $4.2 million for the prior year quarter. The increase was primarily driven by foreign currency gains in the current quarter.

Total Revenues were $294.8 million for the six months ended June 30, 2019 compared with $264.7 million for the same period a year ago, an increase of 11%.

Advisory Revenues were $237.5 million for the six months compared with $201.8 million for the same period a year ago, an increase of 18%. The increase in Advisory Revenues resulted from significant growth in our strategic advisory business and modest growth in our restructuring and special situations business.

Placement Revenues were $52.0 million for the six months compared with $54.3 million for the same period a year ago, a decrease of 4%. The decrease was primarily attributable to a decrease in private equity placement revenues.

Interest Income & Other was $5.3 million for the six months compared with $8.7 million for the same period a year ago. The decrease was primarily driven by a decrease in reimbursable expenses billed to clients.

The following tables set forth information relating to the Company’s expenses for the three and six months ended June 30, 2019 and 2018:

	Three Months Ended June 30,
	2019						2018
	GAAP			As Adjusted			GAAP			As Adjusted
	(Dollars in Millions)
Expenses
Compensation and Benefits	$	119.2		$	106.7		$	94.3		$	83.6
% of Revenues		71.5	%		64.0	%		72.1	%		64.0	%
Non-Compensation	$	33.9		$	31.9		$	26.3		$	25.6
% of Revenues		20.4	%		19.2	%		20.1	%		19.6	%
Total Expenses	$	153.1		$	138.6		$	120.5		$	109.3
% of Revenues		91.8	%		83.1	%		92.2	%		83.6	%
Pretax Income	$	13.6		$	28.1		$	10.1		$	21.4
% of Revenues		8.2	%		16.9	%		7.8	%		16.4	%

	Six Months Ended June 30,
	2019						2018
	GAAP			As Adjusted			GAAP			As Adjusted
	(Dollars in Millions)
Expenses
Compensation and Benefits	$	214.3		$	188.6		$	197.9		$	169.4
% of Revenues		72.7	%		64.0	%		74.8	%		64.0	%
Non-Compensation	$	66.9		$	62.9		$	54.1		$	52.1
% of Revenues		22.7	%		21.3	%		20.4	%		19.7	%
Total Expenses	$	281.3		$	251.5		$	252.0		$	221.5
% of Revenues		95.4	%		85.3	%		95.2	%		83.7	%
Pretax Income	$	13.5		$	43.2		$	12.8		$	43.2
% of Revenues		4.6	%		14.7	%		4.8	%		16.3	%

GAAP Compensation and Benefits Expense was $119.2 million for second quarter 2019 compared with $94.3 million for the prior year quarter. Adjusted Compensation and Benefits Expense was $106.7 million for the current quarter compared with $83.6 million for the prior year quarter. The increase in Compensation and Benefits Expense reflected higher revenues during the current quarter as well as increased headcount.

GAAP Compensation and Benefits Expense was $214.3 million for the six months ended June 30, 2019 compared with $197.9 million for the same period a year ago. Adjusted Compensation and Benefits Expense was $188.6 million for the six months compared with $169.4 million for the same period a year ago. The increase in Compensation and Benefits Expense reflected higher revenues during the current six month period as well as increased headcount.

GAAP Non-Compensation Expense was $33.9 million for second quarter 2019 compared with $26.3 million for the prior year quarter. Adjusted Non-Compensation Expense was $31.9 million for the current quarter compared with $25.6 million for the prior year quarter.

GAAP Non-Compensation Expense increased during the current quarter compared with the prior year quarter, primarily due to increases in Other Expenses, Professional Fees, Depreciation and Amortization and Occupancy and Related. The increase in Other Expenses was driven by interest expense associated with the acquisition of CamberView and additional market data and other expenses associated with increased headcount and business activity. The increase in Professional Fees was primarily due to increased headcount and business activity. Depreciation and Amortization increased primarily due to additional amortization expense related to intangible assets recorded in the acquisition of CamberView during the fourth quarter of 2018. The increase in Occupancy and Related was primarily due to the CamberView acquisition and expansion in our existing locations.

Adjusted Non-Compensation Expense increased during the current quarter compared with the prior year quarter, primarily due to increases in Other Expenses, Professional Fees and Occupancy and Related for the same reasons noted above.

GAAP Non-Compensation Expense was $66.9 million for the six months ended June 30, 2019 compared with $54.1 million for the same period a year ago. Adjusted Non-Compensation Expense was $62.9 million for the six months compared with $52.1 million for the same period a year ago.

GAAP Non-Compensation Expense increased during the six months compared with the same period a year ago, primarily due to increases in Other Expenses, Depreciation and Amortization, Professional Fees and Travel and Related. The increase in Other Expenses was driven by interest expense associated with the acquisition of CamberView and additional market data and other expenses associated with increased headcount and business activity. Depreciation and Amortization increased primarily due to additional amortization expense related to intangible assets recorded in the acquisition of CamberView during the fourth quarter of 2018. The increases in Professional Fees and Travel and Related were primarily due to increased headcount and business activity.

Adjusted Non-Compensation Expense increased during the six months compared with the same period a year ago, primarily due to increases in Other Expenses, Professional Fees and Travel and Related for the same reasons noted above.

As of June 30, 2019, PJT Partners Inc. owned 59.8% of PJT Partners Holdings LP. PJT Partners Inc. is subject to corporate U.S. federal and state income tax while PJT Partners Holdings LP is subject to New York City unincorporated business tax and other entity-level taxes imposed by certain state and foreign jurisdictions. Please refer to Note 12. “Stockholders’ Equity (Deficit)” in the “Notes to Consolidated Financial Statements” in “Part II. Item 8. Financial Statements and Supplementary Data” of the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 for further information about the corporate ownership structure.

In calculating Adjusted Net Income, If-Converted, the Company has assumed that all outstanding Class A partnership units in PJT Partners Holdings LP (“Partnership Units”) (excluding the unvested partnership units that have yet to satisfy certain market conditions) have been exchanged into shares of the Company’s Class A common stock, subjecting all of the Company’s income to corporate-level tax.

The effective tax rate for Adjusted Net Income, If-Converted for the six months ended June 30, 2019 was 25.0% compared with 22.1% for the same period a year ago. This tax rate excludes the tax benefits of the adjustments for transaction-related compensation expense, amortization expense and spin-off-related payable due to The Blackstone Group Inc. (“Blackstone”). The increase in tax rate from the six months ended June 30, 2018 is primarily due to a decreased tax benefit related to the deliveries of vested shares at values in excess of their amortized cost.

As of June 30, 2019, the Company held cash, cash equivalents and short-term investments of $85.6 million. Additionally, the Company had funded debt of $30 million, incurred in connection with the acquisition of CamberView.

On April 24, 2019, the Company’s Board of Directors authorized the repurchase of shares of the Company’s Class A common stock in an amount up to $100 million, which is in addition to the previous October 26, 2017 authorization. As of June 30, 2019, the Company’s remaining repurchase authorization was $107.2 million.

During second quarter 2019, the Company repurchased 639,204 shares of Class A common stock pursuant to the share repurchase program, net share settled 16,650 shares to satisfy employee tax obligations and repurchased 13,995 Partnership Units for cash pursuant to the quarterly exchange program.

In aggregate during second quarter 2019, the Company repurchased an equivalent of 669,849 shares at an average price of $40.23 per share.

The Company intends to repurchase 108,586 Partnership Units for cash on August 6, 2019 at a price to be determined by the per share volume-weighted average price of the Company’s Class A common stock on August 1, 2019.

The Board of Directors of PJT Partners Inc. has declared a quarterly dividend of $0.05 per share of Class A common stock. The dividend will be paid on September 18, 2019 to Class A common stockholders of record on September 4, 2019.

PJT Partners will host a conference call on July 30, 2019 at 8:30 a.m. ET to discuss its second quarter 2019 results. The conference call can be accessed via the internet on www.pjtpartners.com or by dialing +1 (888) 339-2688 (U.S. domestic) or +1 (617) 847-3007 (international), passcode 209 488 02#. For those unable to listen to the live broadcast, a replay will be available following the call at www.pjtpartners.com or by dialing +1 (888) 286-8010 (U.S. domestic) or +1 (617) 801-6888 (international), passcode 375 223 14#.

PJT Partners is a global advisory-focused investment bank. Our team of senior professionals delivers a wide array of strategic advisory, shareholder advisory, restructuring and special situations and private fund advisory and placement services to corporations, financial sponsors, institutional investors and governments around the world. We offer a unique portfolio of advisory services designed to help our clients achieve their strategic objectives. We also provide, through PJT Park Hill, private fund advisory and fundraising services for alternative investment managers, including private equity funds, real estate funds and hedge funds. To learn more about PJT Partners, please visit the Company’s website at www.pjtpartners.com.

Certain material presented herein contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include certain information concerning future results of operations, business strategies, acquisitions, financing plans, competitive position, potential growth opportunities, potential operating performance improvements, the effects of competition and the effects of future legislation or regulations. Forward-looking statements include all statements that are not historical facts and can be identified by the use of forward-looking terminology such as the words “believe,” “expect,” “opportunity,” “plan,” “intend,” “anticipate,” “estimate,” “predict,” “potential,” “continue,” “may,” “might,” “should,” “could” or the negative of these terms or similar expressions.

Forward-looking statements involve risks, uncertainties and assumptions. Actual results may differ materially from those expressed in such forward-looking statements. You should not put undue reliance on any forward-looking statements contained herein. We undertake no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.

The risk factors discussed in the “Risk Factors” section of our Annual Report on Form 10-K for the year ended December 31, 2018, filed with the United States Securities and Exchange Commission (“SEC”), as such factors may be updated from time to time in our periodic filings with the SEC, accessible on the SEC’s website at www.sec.gov, could cause our results to differ materially from those expressed in forward-looking statements. There may be other risks and uncertainties that we are unable to predict at this time or that are not currently expected to have a material adverse effect on our business. Any such risks could cause our results to differ materially from those expressed in forward-looking statements.

The following represent key performance measures that management uses in making resource allocation and/or compensation decisions. These measures should not be considered substitutes for, or superior to, financial measures prepared in accordance with GAAP.

Management believes the following non-GAAP measures, when presented together with comparable GAAP measures, are useful to investors in understanding the Company’s operating results: Adjusted Pretax Income; Adjusted Net Income; Adjusted Net Income, If-Converted, in total and on a per-share basis; Adjusted Earnings Per Share; Adjusted Compensation and Benefits Expense and Adjusted Non-Compensation Expense. These non-GAAP measures, presented and discussed in this earnings release, remove the significant accounting impact of: (a) transaction-related compensation expense, including

expense related to Partnership Units with both time-based vesting and market conditions as well as equity-based and cash awards granted in connection with the spin-off from Blackstone and acquisition of CamberView; (b) intangible asset amortization associated with Blackstone’s initial public offering (“IPO”), the acquisition of PJT Capital LP, and the acquisition of CamberView; and (c) the amount the Company has agreed to pay Blackstone related to the net realized cash benefit from certain compensation-related tax deductions. Reconciliations of the non-GAAP measures to their most directly comparable GAAP measures and further detail regarding the adjustments are provided in the Appendix.

To help investors understand the effect of the Company’s ownership structure on its Adjusted Net Income, the Company has presented Adjusted Net Income, If-Converted. This measure illustrates the impact of taxes on Adjusted Pretax Income, assuming all Partnership Units (excluding the unvested partnership units that have yet to satisfy certain market conditions) were exchanged for shares of the Company’s Class A common stock, resulting in all of the Company’s income becoming subject to corporate-level tax, considering both current and deferred income tax effects.

	Three Months Ended June 30,					Six Months Ended June 30,
	2019		2018			2019		2018
Revenues
Advisory	$	133,035	$	98,294		$	237,502	$	201,757
Placement		28,695		28,132			52,007		54,252
Interest Income and Other		4,974		4,244			5,251		8,703
Total Revenues		166,704		130,670			294,760		264,712
Expenses
Compensation and Benefits		119,165		94,273			214,316		197,905
Occupancy and Related		7,802		6,573			14,938		13,376
Travel and Related		6,721		5,987			13,680		11,457
Professional Fees		5,667		4,019			11,469		9,218
Communications and Information Services		3,493		3,260			6,706		6,740
Depreciation and Amortization		3,635		2,092			7,255		4,099
Other Expenses		6,629		4,328			12,891		9,160
Total Expenses		153,112		120,532			281,255		251,955
Income Before Provision (Benefit) for Taxes		13,592		10,138			13,505		12,757
Provision (Benefit) for Taxes		3,566		(882	)		2,542		(4,992	)
Net Income		10,026		11,020			10,963		17,749
Net Income Attributable to Non-Controlling Interests		5,200		4,075			5,036		5,568
Net Income Attributable to PJT Partners Inc.	$	4,826	$	6,945		$	5,927	$	12,181
Net Income Per Share of Class A Common Stock
Basic	$	0.20	$	0.30		$	0.24	$	0.57
Diluted	$	0.20	$	0.30		$	0.24	$	0.55
Weighted-Average Shares of Class A Common Stock Outstanding
Basic		24,572,535		22,641,562			24,157,671		20,987,863
Diluted		24,572,535		24,185,020			24,157,671		22,689,344

	Three Months Ended June 30,						Six Months Ended June 30,
	2019			2018			2019			2018
GAAP Net Income	$	10,026		$	11,020		$	10,963		$	17,749
Less: GAAP Provision (Benefit) for Taxes		3,566			(882	)		2,542			(4,992	)
GAAP Pretax Income		13,592			10,138			13,505			12,757

Adjustments to GAAP Pretax Income
Transaction-Related Compensation Expense⁽¹⁾		12,475			10,643			25,670			28,488
Amortization of Intangible Assets⁽²⁾		1,984			584			3,968			1,168
Spin-Off-Related Payable Due to Blackstone⁽³⁾		39			26			85			801
Adjusted Pretax Income		28,090			21,391			43,228			43,214
Adjusted Taxes⁽⁴⁾		4,767			3,424			6,265			5,109
Adjusted Net Income		23,323			17,967			36,963			38,105

If-Converted Adjustments
Less: Adjusted Taxes⁽⁴⁾		(4,767	)		(3,424	)		(6,265	)		(5,109	)
Add: If-Converted Taxes⁽⁵⁾		7,054			4,689			10,827			9,553
Adjusted Net Income, If-Converted	$	21,036		$	16,702		$	32,401		$	33,661

GAAP Net Income Per Share of Class A Common Stock
Basic	$	0.20		$	0.30		$	0.24		$	0.57
Diluted	$	0.20		$	0.30		$	0.24		$	0.55
GAAP Weighted-Average Shares of Class A Common Stock Outstanding
Basic		24,572,535			22,641,562			24,157,671			20,987,863
Diluted		24,572,535			24,185,020			24,157,671			22,689,344

Adjusted Net Income, If-Converted Per Share	$	0.51		$	0.42		$	0.79		$	0.89
Weighted-Average Shares Outstanding, If-Converted		41,144,783			39,835,098			41,081,533			37,854,775

	Three Months Ended June 30,						Six Months Ended June 30,
	2019			2018			2019			2018
GAAP Compensation and Benefits Expense	$	119,165		$	94,273		$	214,316		$	197,905
Transaction-Related Compensation Expense⁽¹⁾		(12,475	)		(10,643	)		(25,670	)		(28,488	)
Adjusted Compensation and Benefits Expense	$	106,690		$	83,630		$	188,646		$	169,417

Non-Compensation Expenses
Occupancy and Related	$	7,802		$	6,573		$	14,938		$	13,376
Travel and Related		6,721			5,987			13,680			11,457
Professional Fees		5,667			4,019			11,469			9,218
Communications and Information Services		3,493			3,260			6,706			6,740
Depreciation and Amortization		3,635			2,092			7,255			4,099
Other Expenses		6,629			4,328			12,891			9,160
GAAP Non-Compensation Expense		33,947			26,259			66,939			54,050
Amortization of Intangible Assets⁽²⁾		(1,984	)		(584	)		(3,968	)		(1,168	)
Spin-Off-Related Payable Due to Blackstone⁽³⁾		(39	)		(26	)		(85	)		(801	)
Adjusted Non-Compensation Expense	$	31,924		$	25,649		$	62,886		$	52,081

The following table provides a summary of weighted-average shares outstanding for the three and six months ended June 30, 2019 and 2018 for both basic and diluted shares. The table also provides a reconciliation to If-Converted Shares Outstanding assuming that all Partnership Units and unvested PJT Partners Inc. restricted stock units (“RSUs”) were converted to shares of the Company’s Class A common stock:

	Three Months Ended June 30,				Six Months Ended June 30,
	2019		2018		2019		2018
Weighted-Average Shares Outstanding - GAAP
Shares of Class A Common Stock Outstanding		23,458,031		20,647,911		23,207,749		19,735,236
Vested, Undelivered RSUs		1,114,504		1,993,651		949,922		1,252,627
Basic Shares Outstanding, GAAP		24,572,535		22,641,562		24,157,671		20,987,863
Dilutive Impact of Unvested Common RSUs⁽⁶⁾		—		1,543,458		—		1,701,481
Diluted Shares Outstanding, GAAP		24,572,535		24,185,020		24,157,671		22,689,344

Weighted-Average Shares Outstanding - If-Converted
Shares of Class A Common Stock Outstanding		23,458,031		20,647,911		23,207,749		19,735,236
Vested, Undelivered RSUs		1,114,504		1,993,651		949,922		1,252,627
Conversion of Unvested Common RSUs⁽⁶⁾		566,311		1,543,458		898,124		1,701,481
Conversion of Participating RSUs		54,762		151,707		53,294		153,243
Conversion of Partnership Units		15,951,175		15,498,371		15,972,444		15,012,188
If-Converted Shares Outstanding		41,144,783		39,835,098		41,081,533		37,854,775

	As of June 30,
	2019		2018
Fully-Diluted Shares Outstanding⁽⁷⁾⁽⁸⁾		43,996,462		42,711,906

As of June 30, 2019, there were 3.7 million Partnership Units and 0.2 million RSUs subject to market conditions that are not included in fully-diluted shares outstanding.