Slide 1: Moelis & Company
MOELIS & COMPANY May 2014
Slide 2: Forward Looking Statements
[ 1 ] This Presentation contains forward-looking statements, which reflect the Company’s current views with respect to, among other things, its operations and financial performance. You can identify these forward-looking statements by the use of words such as “outlook,” “believes,” “expects,” “poten
Slide 3: I. Moelis & Company Overview
I. Moelis & Company Overview
Slide 4: Moelis & Company is a Premier Global Independent Investment Bank
Moelis & Company is a Premier Global Independent Investment Bank [ 3 ] Entrepreneurial, growth-oriented advisory firm founded in 2007 Global footprint with 15 offices in North and South America, Europe, the Middle East, Asia and Australia 89 MDs 1 with average of 20 years of experience Focus on M&A,
Slide 5: Moelis & Company Milestones
Moelis & Company Milestones [ 4 ] Founded (July) and Raised Growth Capital from Global Institutional Investors 2007 Hired Restructuring Team (April) 2008 Established European Business 2009 Formed Joint Venture in Australia Established Middle East Presence 2010 Entered Hong Kong and China 2011 Japan
Slide 6: Our Business: Relationships, Judgment and Experience
Our Business: Relationships, Judgment and Experience [ 5 ] Global Footprint to Serve Client Needs with 320 Bankers 1 Note: 1. Includes recent hires in Brazil (subject to regulatory approval) and excludes Australia JV; as of 3/31/2014 LOS ANGELES, US LONDON, UK HONG KONG, CN JAPAN Strategic Alliance
Slide 7: Premier Brand for World Class Advice
[ 6 ] Premier Brand for World Class Advice Sale to Berkshire Hathaway and 3G Capital $28bn Sale to The Blackstone Group $26.5bn Sale to IntercontinentalExchange, Inc. $10.7bn Acquisition of Foster’s Group Limited A$11.7bn Chapter 11 Reorganization $5.0bn Merger with Brookdale Senior Living Inc. $5.3
Slide 8: Why Moelis & Company?
We are driving value by creating the premier global investment bank Market Trends Differentiated Approach [ 7 ] Why Moelis & Company? Strong Financial Discipline and Ownership Mentality
Slide 9: Why Moelis & Company? Market Trends
We are driving value by creating the premier global investment bank Market Trends Differentiated Approach [ 8 ] Why Moelis & Company? Strong Financial Discipline and Ownership Mentality
Slide 10: Market Dynamics Create an Extraordinary Opportunity
Market Dynamics Create an Extraordinary Opportunity [ 9 ] Client demand for unconflicted advice continues to grow Regulatory, political and social pressures on financial conglomerates limit their ability to compete Improving global economy and CEO confidence should fuel an M&A market uptick Recapita
Slide 11: Demand for Independent Advisors Continues to Grow With Moelis Gaining Market Share
ADVISORY REVENUE AS A PERCENTAGE OF FEE POOL Source: Public filings Notes: Includes only advisory revenue Independents consist of Evercore, Greenhill, Lazard and Moelis Total advisory fee pool consists of Bank of America Merrill Lynch, Citi, Credit Suisse, Deutsche Bank, Evercore, Goldman Sachs, Gre
Slide 12: Moelis & Company Should Benefit From an M&A Market Upswing
Source: Thomson Reuters Notes: Global announced transactions greater than $100 million Represents Q1 2014 annualized Moelis & Company Should Benefit From an M&A Market Upswing GLOBAL ANNOUNCED M&A 1 [ 11 ] Moelis & Company Founded 2
Slide 13: Moelis & Company Should Benefit From Record New Debt Issuance
GLOBAL NEW DEBT ISSUANCES VS. DEFAULT RATES Source: Thomson Reuters Notes: High yield issuance based on Thomson Reuters. Leveraged loan issuance based on S&P Capital IQ LoanStats Weekly Based on Moody’s “Annual Default Study: Corporate Default and Recovery Rates” Represents Q1 2014 annualized [ 12 ]
Slide 14: Why Moelis & Company? Differentiated Approach
We are driving value by creating the premier global investment bank Market Trends Differentiated Approach [ 13 ] Why Moelis & Company? Strong Financial Discipline and Ownership Mentality
Slide 15: Our Differentiated "One Firm" Approach
[ 14 ] Our Differentiated “One Firm” Approach Global connectivity and integrated advice Compensation philosophy and culture Intense focus on transaction execution Internal talent development grows franchise value
Slide 16: Integrated Approach Delivers Value for Clients
M&A / GENERAL ADVISORY ü ü ü ü ü RESTRUCTURING ü ü ü ü ü CAPITAL MARKETS ADVISORY ü ü ü MULTI-REGIONAL TEAM ü ü INDUSTRY EXPERTISE ü ü ü ü ü Exclusive Investment Banker to Official Committee of Unsecured Creditors of AMR $17.0bn Merger with US Airways Group $29.6bn Chapter 11 Reorganization Integrat
Slide 17: Successfully Managed Unprecedented Historical Growth
Metric Moelis Greenhill 1 Evercore 2 Lazard Years Since Inception 6+ 17+ 17+ 165+ 2013 Investment Banking Revenue ($mm) $411 $287 $667 $981 2013 # of MDs 86 69 142 132 Notes: Figures as of 12/31/2013 Greenhill # of MDs excludes Senior Advisors Evercore # of MDs includes Senior MDs and MDs (per compa
Slide 18: Experienced Global Team Drives Innovative Solutions
Experienced Global Team Drives Innovative Solutions [ 17 ] 8 PRODUCT HEADS 28 INDUSTRY HEADS 9 REGIONAL HEADS 4 M&A HEADS 52 FORMER SECTOR & PRODUCT HEADS 3 R&R HEADS
Slide 19: Enhanced Global Brand Recognition Leads to New Clients
[ 18 ] Enhanced Global Brand Recognition Leads to New Clients NUMBER OF FEE-PAYING CLIENTS
Slide 20: Our Growth Opportunities Going Forward
[ 19 ] Our Growth Opportunities Going Forward Note: As of 3/31/2014 Enhanced global brand recognition Upside in Europe Over 60 advisory professionals in Europe Maturation of new MDs and internal talent 42% have been Moelis MDs for 3 years or less 1 Recent sector build outs / targeted future hiring R
Slide 21: Why Moelis & Company? Financial Discipline
We are driving value by creating the premier global investment bank Market Trends Differentiated Approach [ 20 ] Why Moelis & Company? Strong Financial Discipline and Ownership Mentality
Slide 22: Financial Discipline Evidenced in Key Decisions
Financial Discipline Evidenced in Key Decisions [ 21 ] Acquiring and developing talent Entering new markets Compensation philosophy
Slide 23: II. Financial Overview
II. Financial Overview
Slide 24: Attractive Financial Profile
Attractive Financial Profile STRONG GROWTH PROFILE Strong growth trajectory VARIABLE EXPENSE STRUCTURE Compensation expense is the primary operating expense ATTRACTIVE FREE CASH FLOW PROFILE AND STRONG BALANCE SHEET Minimal capital requirements Healthy margins with scalable platform Substantial cash
Slide 25: Ability to Grow Revenue and Earnings Despite Challenged Market
Ability to Grow Revenue and Earnings Despite Challenged Market REVENUE AND OPERATING MARGIN M&A Y-o-Y Change 2 (29.2)% 29.8% 0.4% (4.2)% (2.5)% 19.3% 4 Default Rates 3 13.2% 3.3% 1.9% 2.6% 2.8% 2.3% Source: Thomson Reuters Notes: US GAAP revenue and operating margin LTM as of 3/31/2014 Global announ
Slide 26: Strong Balance Sheet
[ 25 ] Strong Balance Sheet Strong cash position No debt No balance sheet lending Minimal capital requirements Notes: Unaudited pro-forma for the Company’s initial public offering. Numbers may not tie due to rounding Includes investment in joint venture Cash & cash equivalents $78.4 Restricted cash
Slide 27: Investment Highlights
Investment Highlights [ 26 ] Preeminent global independent investment bank Strong secular and cyclical tailwinds Differentiated culture and economic model Ownership mentality drives long-term shareholder value
Slide 28: Appendix
Appendix
Slide 29: Lock-Up Summary
Lock-Up Summary [ 28 ] Holders Number of Class A Shares / Exchangeable Units Lock-Up Terms All Executive Officers and Managing Directors 1 38.4 million 4 to 6 year lock-up (3 equal installments on each of the fourth, fifth and sixth anniversary of the IPO closing date) Pre-IPO Outside Investors and