Q1 2025 Moelis & Co Earnings Call

Speaker Change: Good afternoon, and welcome to the Moelisin Company earnings conference call for the first quarter 2025. To begin, I'll turn the call over to Mr. Matt Tsukroff.

Speaker Change: Good afternoon, and thank you for joining us from Moelis & Co, first quarter, 2025 Financial Results Conference Call.

Speaker Change: On the phone today are Ken Moelis, Chairman and CEO and Chris Colossano, Chief Financial Officer.

Speaker Change: Before we begin, I would like to note that the remarks made on this call may contain certain forward-looking statements which are subject to various risks and uncertainties, including those identified from time to time in the risk factor section of Moelis & Co. with the SEC. Actual results could differ materially from those currently anticipated. The firm undertakes no obligation to update any forward-looking statements.

Speaker Change: Our comments today include references to certain adjusted financial measures. We believe these measures when presented together with comparable GAAP measures are useful to investors to compare our results across several periods and to better understand our operating results.

Speaker Change: The Reconciliation of these Adjusted Financial Measures with the Relevant GAAP financial Information and other information required by RegG is provided in the firm's earnings release which can be found in our Investor Relations website at investors.moelis.com. I will now turn the call over to Chris to discuss our results.

Chris: Thanks Matt, and good afternoon everyone. On today's call, I will go through our financial results and then Ken will comment further on the business.

Chris: Moving to Expenses, our first quarter compensation expense ratio was 69%, as the year progresses, our compensation ratio will depend on the destructory of revenues and the pace and magnitude of hiring throughout the year.

Our first quarter non-cop ratio was 19% [inaudible]

Chris: The quarterly year-over-year growth in non-compensation dollars is primarily attributable to increased costs associated with our investment in client conferences.

Chris: Many of which occurred during the first quarter. As indicated previously, we currently anticipate the full-year growth of non-compensation expense to be approximately 15%.

Chris: According to taxes, our underlying corporate tax rate was 29.5% for the quarter before the discrete tax benefit related to the best of equity awards, adding in this discrete benefit resulted in an overall net tax benefit for the quarter.

Chris: Regarding Capital Allocation, the board declared a regular quarterly dividend of $0.65 per share. And lastly, we continue to maintain a strong balance sheet with no funded debt. I will now turn the call over to Ken.

Ken: Thanks, Chris, and welcome to your first earnings call, a CEO , a CFO , sorry, not C.I.

Ken: As we finished the first quarter, we had record-new business origination and a record pipeline. Our go-to-market, including the maturation of our investments in tech and energy, are extremely strong, and we finished the quarter with a very bullish point of view for 2025.

Ken: However, the new wave of volatility introduced into the capital markets post April 2nd has definitely slowed M&A transaction activity.

Ken: Although the scale and time frame is hard to predict, we believe this is a temporary phenomenon and we are planning our business accordingly.

Ken: The silver lining is that no matter the outcome, our clients will need strategic advice and will turn to our team to help them better understand their capital needs and how they can adapt or transform their business models.

Ken: We continue to invest in the growth of our private funds advisory business. Following the announcement earlier this year of a senior banker to lead the team, we have a robust pipeline of additional senior talent and expect to have more news on that in the coming weeks.

Ken: Private Capital Solutions and Continuation Vehicles will continue to be an important liquidity tool for sponsors and our goal is to be the market leader in the space.

Ken: We also remain focused on adding talent to fill other areas of strategic importance to the firm. Technology focused and managing director based in Europe recently joined the firm and one focused on business services in Europe will also join shortly.

We're optimistic about the road ahead and our well-positioned.

Ken: Remember, there are no tariffs on relationships and the world-class advice we delivered to our clients every day.

We have no debt in a strong cash position.

Ken: and our talent, breath of experience and culture of collaboration are stronger than ever before. With that, I'll open it up for questions.

Ken: Thank you. We will now begin the question and answer session. If you would like to ask a question, please press star one in your telephone keypad to raise your hand and join the queue. If you would like to withdraw your question, simply press star one again. Your first question comes from a line of Devin Ryan from Citizens, your line is open.

A great high-can, high-curus, welcome.

Devin Ryan: First question, can't great to hear about, obviously, the backlogs where they are right now and appreciate more in a pretty uncertain moment here.

Devin Ryan: I guess they're still a little bit of TBD on the year, but I'm curious just with the backlogs

Devin Ryan: Do they get canceled versus just pushed out? And I guess I'm just trying to think through there's a lot of competing forces here sponsors I have a lot of pressure on them to do something with kind of the the long duration of their portfolio today so feel like there's a lot of pressure there at the same time.

Devin Ryan: You know, volatile asset prices, make it challenging. So just love to get a sense of, you know, how the backlogs kind of move from here and what potentially would cancel them if it all.

Devin Ryan: It's a tough question to answer. It's a very specific policy dynamic that's going on right now. The reason I believe it's temporary because it's in the control. I'm not saying it might not work out to be exactly what the markets want, but it is in the control.

Devin Ryan: Problems like COVID and even the GFC back in08, they seem to be outside the control of an individual COVID definitely was. We didn't know what was going to happen and it was very hard to know when the end would come.

We've lost some from the-

Devin Ryan: Quarter-end backlog that I talked about. We have lost some, um, strategics.

Devin Ryan: might be quicker to put down their pencils on supply chain affected transactions. Sponsors will put things on hold.

Devin Ryan: I think the go-to market on sponsors that need liquidity are probably timing, you know, those

You can't hold them forever the sponsor liquidity

Devin Ryan: But there are some transactions that have gotten shelved and we no longer have them in backlogs. Our backlog is down from 331 as a result of it.

and it's really hard to say. You know...

Devin Ryan: What the effect of the day-to-day volatility? You have two things, the policy volatility and then the market volatility and pricing, interest rate volatility, so that's all taken a toll on it.

Speaker Change: We've lost some, but I would say the vast majority are in pushback, I think.

Alright, you had a time frame pushback.

Speaker Change: Yeah, got it. Okay, thanks Ken, really helpful. And then just to follow up on the restructuring business, just great to get a little bit of a...

Speaker Change: You know, maybe flavor for what you guys are seeing there kind of whether there's been any tone shift just with some of the uncertainty in the markets, anything around tariffs and not sure if anything has changed there and just the trajectory of kind of new mandates coming in and that business as well. [inaudible]

Speaker Change: So I'd say the first quarter restructuring was kind of flat. It was what we were expecting, which was there's a good economy the strong consumer interest rates seem to be coming down. So we weren't expecting a big year out of restructuring and you're talking about a two to three week period since then in which yes.

There are lots of conversations starting to develop about

Speaker Change: The things that might happen, but haven't happened, but could happen. So, that conversation is picking up. Have there been a substantial increase in mandates?

Speaker Change: Due to events around April 2nd, I'd say no. I'd call it an increase of significant conversation.

Speaker Change: Mortso, I think it's in the capital market side, where companies are trying to figure out if they've got to fund inventory purchases. Supply chain.

Transactions

Speaker Change: that have tariffs associated with them, so working capital financing has gone up, they have to actually finance.

Speaker Change: The acquisition of supply chain goods that might have gone up significant amount to the tariffs, etc. I think there's almost been more conversation around financing options than this idea of going straight to restructuring.

Speaker Change: That's why we kind of combine the two when we talk about it because they kind of subsume each other and that's where we are I think we're financing is probably the primary thing being talked about not quite yet to restructuring. [inaudible]

Speaker Change: Yeah, very interesting. I'll leave it there, but thanks Ken, I appreciate it.

Thanks, Devin.

Speaker Change: You are next question comes from a lineup Kenneth Worthington from JP Morgan. Your line is open. Hey great, good afternoon. Thanks for taking the questions. Ken I would love to hear your thoughts when thinking about the

Ken Worthington: Volatility and the impact, looking at things three ways. One is sort of geographic.

Ken Worthington: U.S. vs. Europe and Asia, any sort of differences that the volatility has sort of brought out. I know it's really recent, but thus far, sponsor versus non-sponsor and then big versus small.

Ken Worthington: What are your thoughts and to the extent you've heard? What have you heard?

Ken Worthington: And Ken, I think what you're asking me is post April 2nd, right? Because there are two different environments. Post April 2nd. Yeah, I'm sorry. Yeah.

Ken Worthington: So look, I actually think, again, I always say the US is the most dynamic market.

Ken Worthington: They're trading better. They don't have some of the supply chain issues. So you...

Ken Worthington: You know, I think transactions in Europe haven't hiccuped as much. They're obviously less transactions to begin with.

Ken Worthington: But they're not directly in the line of fire right now and there have been some indications that the economies in Europe

Art going to spend some capital and...

Ken Worthington: Take some actions that I think could be actually positive for Europe , so I'll say that. That's a three-week read. Remember I'm reading the tea leaves while they're still falling off the tree I would say.

Ken Worthington: I haven't seen you. Obviously, China Asia is going to be very different, and I don't know that I have enough...

Ken Worthington: I'm excited to tell you what happens to Hong Kong Asia, Japan Asia by the way seems pretty, there's a lot of optimism around Japan as a market, but again we're early on and I assume China's going to be, you know, without resolution there'll be a lot of difficulties out of China. I know you said big versus small, what was the second?

That's what I'm sure next stop, Plotter.

All of them.

I think if you were um...

Speaker Change: It depends on the sector, right? If you're American-based, if you're not a supply chain oriented,

Speaker Change: Transaction. A lot of that's going forward. There is a lot of financing available. The private credit is out there looking to put capital to work. The bank market, a little more difficult, but private credit is out there. And if you have a healthcare business in the United States, it's not affected by supply chain.

Speaker Change: You're probably going to get your transactions done, and that's both strategic and sponsor. I would actually think that it's more of what sector you're talking about than strategic versus sponsor. Are you affected?

Speaker Change: And when I say effect it, I think there are people now trying to figure out, you know, kind of third derivatives, if, you know, if there's no containers, shift, shift

Speaker Change: For another month because of the tariffs, you know, you're starting to think a second and third derivative so I think the effects might get more widespread than people think but right now I don't see a big difference in those so long as you're talking about.

Speaker Change: The Effect of the Supply Chain, and I would say that kind of goes to your big versus small, which it's very hard to have, you know, you don't have a lot of big companies that don't have a supply chain that, you know, is complicated.

Speaker Change: By just by the characterization of being large companies, they have a very good chance of encountering a supply chain issue that would cause a transaction to go on hold.

and I think it's because it's such a digital outcome on the policy that it's very hard to underwrite people.

Companies and sponsors can underwrite uncertainty.

Speaker Change: But not when it's digital and in the total outcome of the administration, I think. So yeah, a lot of those are going to go on hold and it really starts with is your supply chain effect? Are you affected by the supply chain? I think that's where it breaks.

Ken Worthington: Okay, great, I feel like that was three questions, so I won't be able to take all three Q, I appreciate it. Alright, thanks again.

Speaker Change: You are next question and comes from the line of James Yaro from Goldman Sachs. Your line is open.

James Yarrow: Good afternoon. Thanks for taking the questions. So I just wanted to touch again quickly on CEO confidence. You've been through plenty of cycles, and so you've seen various exogenous shocks. Maybe you could just help us think about how long it has taken on average perhaps in historic episodes that you think are most similar to this with this sort of exogenous shock before CEOs come back to the table in engaging in M&A transactions.

James Yarrow: Well, I'm now trying to think of a good analogy. You're supposed to have a 40-year history and come up with a great analogy. I don't have a great one because the last two or three I remember are COVID, regional banking, even the fed hiking interest rates of the GFC before that.

and you can't even go back to some of the...

Speaker Change: Let's say, you know, I remember when the Iraq War, you know, you shut down it. People were out on road shows and you kind of blew a whistle and said, everybody come back home. This was the not by the way. This was the first Iraq War. And you just you just sent a signal out. Everybody come home. There's nothing to do until we figure out what's going to happen here. I'm sorry. I'm sorry. I'm sorry. I'm sorry.

James Yarrow: But that was a more complicated to see. I really believe this...

My God on this is a short sharp.

James Yarrow: because there will be a policy outcome. That policy outcome could be very negative or could move on very quickly. And I think it's in control, right? We're not waiting to see.

James Yarrow: You know, is COVID a disease that will rampage throughout the planet, you know, and have no solution? We sort of have people could call it off tomorrow if they wanted to, right? You could go back almost with some shocks to the system.

James Yarrow: So it is a directed policy decision. My belief is that if you told me somebody snapped their fingers and all of the policy was settled, I believe M&A would return very rapidly.

Very Rapidly

Dear

James Yarrow: People have growth plans, they have strategic things they want to affect.

James Yarrow: Even what I just talked about about our own firm. We have a deal slowdown.

James Yarrow: and yet we are very actively hiring in private capital advisory. We are hiring into a world that is going to be very active in M&A and I think that tells you what I think about the world.

James Yarrow: An Active Deal Market, where people will want to execute on their plans that they've been waiting to execute on and got disrupted. So I think it will be pretty quick as the answer.

Okay, it's super clear. Maybe just another one on restructuring here. So, you know, I think within restructuring you've seen, you know, a lot of the activity over the...

James Yarrow: recent years be driven by a liability management. I think a significant portion of that has been refinancing of sponsor portfolio company debt stacks. So let's just say we do end up with a harder landing.

James Yarrow: How would you think about the trajectory for structuring revenue? Obviously liability management exercises are shorter in duration and chapter 11 and traditional bankruptcy are longer and the fees are back end weighted. So how would you think about the path for structuring in a weaker economic scenario? Is that what we end up with?

James Yarrow: Yeah, I think a lot of it would be liability management. I believe, um,

James Yarrow: As opposed to the restructuring environment, let's say you go back ten years ago in the GFC and there's so much more equity inside of in in most sponsor deals now have more than 50% of the purchase price and equity it just leaves you a lot of value.

to go.

to Private Capital or Alternative Sources and the...

James Yarrow: Structure some pretty interesting securities to extend out the runway and try to figure out is this a temporary shock to the system and as I said everybody would prefer high cost debt to chapter 11. There's no choice between those two.

And I just think that you don't have an over-levered

James Yarrow: Well, let me say you don't have an overlavered balance. You might have leverage vis-a-vis the cash flow.

James Yarrow: But, you know, some of these companies were valued at 15-18 times, even though so...

James Yarrow: They may have cash flow difficulties but the valuation, the amount of equity put in under the value, I think will be make liability management a very interesting part and that will be where all the activity is I think.

James Yarrow: And unless you have a tremendously unexpected continuation of tariffs that are so difficult that it actually does disrupt the whole global order for a long period of time. That would be the alternative that...

James Yarrow: You know, we really do have a long term, very punitive tariff system that really does disrupt American business. I don't expect that.

Speaker Change: Okay, super clear. Just one takey-tacky one. Could you give us the split of revenue this quarter perhaps across M&A cat markets and restructuring?

Speaker Change: It's about two-thirds M&A and one-third cat markets and restructuring and again I'm going to combine those two because they really are a blendable item.

Okay. Thanks so much.

Speaker Change: Your next question comes from Alina, Brennan O'Brien from Wolf Research. Your line is open.

Brendan O'brien: Good afternoon. Thanks for taking my questions. You know, I just want to talk about the recruiting backdrop. I know that recruiting this year was expected to be focused on a build out of your private capital advisory team, which it sounds like you're off to a bit start on. But given activity to start the year has been a bit slower, I just wanted to get a sense as to whether you're seeing any improvement in the recruiting environment and whether you might look to lean in more aggressively than you expected at the start of the year.

Thank you.

Brendan O'brien: Again, you're talking about a three week period and so, you know, because the first quarter, I think everybody's pretty bullish. It was gonna be a great year for everybody.

Brendan O'brien: I haven't seen a dramatic change in the last three weeks. I think it would be too soon for almost for me to see it, but it would seem good talent.

I think again.

Brendan O'brien: One of the things I always talk about is, we are an unlevered company with a lot of excess capital. Most of the big banks are very heavily levered. So, what do you know?

Brendan O'brien: They are deposit institutions with, you know, 9 to 1 leverage. And so I do think as if the world stays this volatile, I continue to believe the talent will leave 9 to 1 levered institutions that have

Brendan O'brien: You know, mismatched deposits versus assets and liabilities and are very shaky and

Brendan O'brien: You know, I think people have learned, no matter what you're told, those balance sheets are not as clean as their portrayed in a shaky, volatile world. As I said, if you were ten to one levered right now. You know, I don't know, I don't know, I don't know.

Brendan O'brien: I don't know any asset that I own that's not down 10% since April 2nd.

Brendan O'brien: So you'd have to wonder about how you can be ten to one lever and be confident in your balance sheet. So I think we'll be the beneficiary of that. It's one of the reasons we keep a very strong balance sheet. We know it's attractive.

Brendan O'brien: to that banker that is looking where to place their lifetime, their family, and their lifetime future career. And I think more and more people look at it and go, yeah, that's where I want to be. So we keep, that's one of the reasons we do keep our balance sheets so strong.

Brendan O'brien: And so I don't see a big change right now. We're going to go after the private capital advisory situation very hard. We'll fill in but we're always planning on filling in some of our other places but you'll see us be strong and private capital and I think we have.

Brendan O'brien: A good line of sight into some very strategic hires right now that I can't talk about.

Speaker Change: That was great. For my follow-up, I just wanted to touch on the Compratio. Understand there's a lot of unknowns at the moment and the accrual is somewhat of a reflection of, like, the by-fricated potentially outcomes of this year.

Speaker Change: I was hoping you could help us or help frame how to think about the level of revenue growth needed to keep your ratio flat year on year or maybe like what the break even point is.

Speaker Change: You know, I'm going to try to stay away from the algorithm. Last year we were at a point where

Speaker Change: You know, we invested a lot in the tech group and we had made so much investment, we had to give you a road map and I was very nervous that we were giving you the right road map because there's so many movable things.

Speaker Change: I don't want to, I'm not going to try to get back into that because it will the, how fast we hire people, how long this stays, how rapidly, you know, if it's, if this is a

Speaker Change: 6 week downturn, and then it rapidly springs back like I'm saying I'm going to continue to build pretty significantly for what I think are a strong next 12 months is really what I want to do anyway so I think it's just too volatile and there are too many moving parts for me to give you an algorithm. Let's go.

Speaker Change: But, you know, our intention is to get the compression down while building a great business. And that is...

Speaker Change: I just don't want to get caught into some algorithm that doesn't match the opportunity or the volatility inherent in the market.

Thank you.

Totally fair. Thanks for taking any questions. Thanks

Speaker Change: Your next question comes from a line of Mike Brown from Wells Fargo Securities. Your line is open.

Great, thanks. Good afternoon.

Mike Brown: Kenneth wanted to dive into 2Q here. We're just a few weeks into the quarter, certainly much more volatile environment.

Mike Brown: Can you maybe just give us a little bit of views into the quarter relatives to one queue? It's not easy from really anyone's.

Mike Brown: Perspective. Maybe you can shine a light on to how to think about

Mike Brown: You know, the revenue potential just based on either what you can see in terms of the deals that are set to close and which ones you may be asking greater confidence in, the contribution of non-MNA.

Mike Brown: So things, you know, we're getting pushed out. Some things are getting delayed that we thought would be in Q2 and we don't think and then there are some that are that are dying. Like I said, our pipeline is down, not dramatically, but it's down from March 31st.

Mike Brown: Interestingly, there are some things that were announced and are in process of closing, so it's not like there's a shutdown on the quarter, but the quarter we're having trouble getting our hand a lot exactly when things we thought we're going to get pushed into market are going to go to market it's difficult for us to know that as well. So I would just say it's. [inaudible]

E.T.

Things are being pushed out.

Mike Brown: It's not, I don't look at it as horror, it's not horrible, it's not as bad as the volatility

Mike Brown: How difficult it is for people to understand what's going on, because, again, things that were announced.

Mike Brown: During the first quarter, we'll close in the second, but there's many things getting pushed out. So I'm going to leave it at that, which is I don't think it's disastrous, but it's not as good as I was hoping it was going to be. [inaudible]

Speaker Change: So, with this M&A upswing being pushed out, perhaps this tariff related turmoil is quick, but if it's not, and the eventual recovery is kind of slower with more fits and starts, and maybe just a bit.

Speaker Change: Weaker, overall, and more spread out. What I'm interested to hear about is how do you think about

Speaker Change: Protecting the margins, investing in the talent building up the private capital business.

Speaker Change: What do you do in terms of retaining talent? Do you take a closer look at the mix of talent that you currently have and what the opportunities are and do you kind of reassess or maybe do some right sizing? Just talk through that a little bit for us. Thank you.

Speaker Change: We would look at all the above, which we do look at every year.

We do believe that the private-

Speaker Change: Capital, by the way, I think we're transitioning the names. It's private funds advisory, we're thinking of transitioning the names. These names get confusing, but it is the group that does the secondaries. I think that's an important part of the world, by the way. We're not going to slow down.

Speaker Change: We think that is key, and maybe even as the M&A environment in the IPO market gets more difficult, like you said, if you think they're going to be in a difficult mode, you want to have that asset, that...

That expertise and go to market, so that's very important.

Speaker Change: And then we're going to fight to keep all our good talent. We think, in the last couple of years, what we did in technology and energy and then our existing fantastic, you know, people in, and by the way in industrials, we hired some great people, our media, our healthcare franchises.

Speaker Change: You know, we're extremely happy with where, you know, where the fourth quarter came in, where the first quarter was trending to, you know, up 40, what will be up 41% I think was a number.

Those are not bad numbers.

Speaker Change: If a policy event didn't happen on April 2nd, you can't put it on the sidelines and come back. Everybody come back. We sent you out for on vacation. You can't put it on the sidelines and come back.

Speaker Change: We put together an extraordinary go to market team and we're going to protect it unless we see something that is so awful that we think it extends out over a period of time and I can't imagine that a policy decision over tariffs is that item.

This is not-

Speaker Change: You know, a world war, maybe a world powerful, but it's not a I believe it is a policy issue that's going on and not a fundamental degradation of business and especially the transaction business. [inaudible]

Good, great. Thanks for taking my questions, Kenneth.

Speaker Change: Again, if you'd like to ask a question, press star one in your telephone keypad. Your next question comes from a line of Ryan Kenny from Morgan Stanley . Your line is open.

Hey, good afternoon. Thanks for taking my question.

Speaker Change: I want to follow up on the Comprisio discussion earlier.

Speaker Change: Understand that you're not giving us a formula this year, which...

Speaker Change: makes a lot of sense given the uncertainty. But can you clarify, was the 69% in the first quarter based on your revenue assumption for the full year as of March 31st or is that your current expectation if this environment persists as a fairer to assume that that could go up for the rest of the year?

Speaker Change: Chris Answer, but my understanding is the requirement is you take your best efforts, guess, and that's what that is. On revenue and estimate for the years, I mean, 69% for the quarter, it's our best estimate for the second quarter and the full year at this time, as Ken said, it's dependent on the trajectory of revenues and the hiring as we make investments in strategic areas like private fund advisory.

But yes, it's, it's our best estimate currently at this time.

Speaker Change: So it's your best estimate after the tariff announcement, not as of March 31st.

Speaker Change: Yes, it's our best estimate given everything we know and it includes even you know a pretty good hiring you know we want to hire into private funds advisory we know that so we included that in there and things might change but that's our best estimate given all the elements that we know and hope to succeed on and and you know the liberation day event. Thank you very much.

All right, great. Thank you.

Speaker Change: Your next question comes from the line of Ben Rubin from UBS. Your line is open.

Speaker Change: Hi, thanks for taking my questions. Last week you announced another senior hire for your tech franchise over in London. So I'm just curious, you know, what are you seeing from the tech team that you lifted out in 2023? Have they been performing better or worse than your original expectations and maybe how does their productivity compare to your broader M&A business at large? Thanks.

Speaker Change: Thank you for that question. The tech team has been a stunning success.

Speaker Change: Now, I don't want to tell Jason that it's better than I expected, because then he'll think I thought he wasn't a good guy.

Speaker Change: James, I thought we hired a great team and it's been a great team.

What it's done is again. End.

Speaker Change: In the sponsor world, we want to be important to sponsors. We want them to think, okay, is Moelis showing us their best and are we giving them enough?

Speaker Change: You know, it's kind of a bilateral trade, right? I'll bring the trade agreement into this with sponsors and advisors like are we showing you too much good? I should get Trump in here to negotiate for me, but you know are we showing you too many good ideas and you're not giving us back enough and that kind of goes on it's trade. trade.

Speaker Change: And what the tech team does is has added like six or seven thousand calls, idea calls where we're in the you know over and above everything we were doing so if we were important in the halls of sponsors.

Speaker Change: Prior to that, not only are they producing significant revenue, backlog, but they're also improving everybody else's.

Speaker Change: Impact at the sponsor level, so it's been phenomenal, so energy's doing the same thing, so it's been, if I have to admit it, it's been even better than we thought, when we did it.

Thank you.

Speaker Change: It's great to hear. I'm not going to ask explicitly about the Compratio, but is there any chance you could share the dollar impact to the Compratio expense in the first quarter from the accelerated investing of retirement eligible bankers? Thanks.

Speaker Change: Yeah, I mean, I think you're going to see that in the 10-2. So, the...

Speaker Change: Q1 always has a higher fixed comp ratio due to the retirement eligible equity hitting all in Q1. I would say it's about double the expense than a normal quarter, and so we also accrue an incentive comp, right? It just means that there's a higher proportion of fixed comp versus variable comp in the first quarter and we balance it out over the year.

Great. Thanks, Chris. Sure.

Speaker Change: And there are no further questions at this time. I will now turn the call back over to Ken for closing remarks.

Ken Worthington: Thank you. Pleasure to be with you. You know, the first time I think we were first to go and I think with the every day you want to be later and later maybe there'll be a resolution before some other people tell you what's going on in the world in the whole tariff war. But look forward to seeing you and hopefully.

Speaker Change: We'll have this all behind us and talk about some brighter future, thanks.

Speaker Change: This concludes today's conference call. Thank you for your participation. You may now disconnect.