Houlihan Lokey (HLI) investor relations material

Executive summary

• Achieved record annual revenue of $2.62 billion for FY 2026, up from $2.39 billion year-over-year, with a five-year revenue CAGR of 11% and adjusted EPS of $7.56, up 20% year-over-year.

• Maintained strong adjusted pre-tax margins at 23.0% in FY 2026, with diversified business across Corporate Finance, Financial Restructuring, and Financial and Valuation Advisory.

• Fourth quarter revenue was $636 million with adjusted EPS of $1.63; both Corporate Finance and FVA had their highest Q4 revenues ever.

• Hired or acquired 33 Managing Directors in FY 2026 and promoted 25 more in Q1 FY 2027, expanding to 33 locations and 2,776 employees.

• Announced a 16.7% increase in quarterly dividend to $0.70 per share, reflecting growth outlook and resilience amid macroeconomic uncertainty.

Financial highlights

• Corporate Finance Q4 revenue: $434 million, up 5% year-over-year; FY revenue $1.75 billion, 17% five-year CAGR, 251 Managing Directors.

• Financial Restructuring Q4 revenue: $110 million; FY revenue $529 million, down 3% year-over-year, 0% five-year CAGR, 59 Managing Directors.

• Financial and Valuation Advisory Q4 revenue: $91 million, up 3% year-over-year; FY revenue $344 million, 13% five-year CAGR, 44 Managing Directors.

• Adjusted net income for FY 2026 was $518 million, up from $434 million year-over-year; adjusted EPS was $7.56.

• Ended FY 2026 with $1.36 billion in unrestricted cash, cash equivalents, and investment securities.

Outlook and guidance

• Management expects continued elevated performance in Financial Restructuring for FY 2027, driven by credit market instability and sector dislocation.

• Corporate Finance backlog remains strong, with international growth outpacing U.S.; FVA momentum normalized with growth expected in FY 2027.

• Anticipates continued growth through organic hiring, strategic acquisitions, and expansion of service offerings.

• Adjusted compensation and non-compensation expense ratios expected to remain consistent in FY 2027.

• Q1 FY 2027 adjusted effective tax rate expected to be about half of Q4 FY 2026 due to share vesting.