Lazard swings to profit on investment banking rebound, beats estimates
Lazard CEO says dealmaking environment is constructive
Bank's adjusted revenue hits record $855 mln in first half
Lazard eyes acquisitions to expand asset management business
Updates with record revenue in paragraph 3, CEO comments, analyst estimates in paragraph 11.
By Manya Saini and Lananh Nguyen
July 25 (Reuters) -Lazard LAZ.N swung to a profit in the second quarter, exceeding analysts' expectations as dealmaking surged.
Wall Street investment banks have benefited from a rebound in activity as corporations carry out mergers or raise money with stock and debt offerings. The recovery comes after rising interest rates weighed on activity for two years.
Revenue in Lazard's financial advisory business climbed 17% to $411 million in the second quarter, while its adjusted net revenue jumped 38% to a record $855 million in the first half of the year, the bank said on Thursday.
"Looking ahead, geopolitical uncertainty remains, but we continue to see a constructive environment for our business activity, especially as we shift to a world where central banks reduce rates," CEO Peter Orszag told reporters on a conference call.
Across the broader industry, mergers and acquisitions revenue rose 8% in North America in the first half, according to data from Dealogic. Lazard was ranked among top advisory league tables and earned the tenth highest fees across banks globally over the same period.
The boutique investment bank advised on several major deals including WestRock's $33.5 billion combination with Smurfit Kappa and Rivian's $5 billion strategic investment from Volkswagen Group, among others.
Lazard has hired nine managing directors in its financial advisory business this year, Orszag said.
"We are seeing a lot of discussion and activity," for large and small deals across many sectors, particularly technology, energy transition and biotech, he added.
Meanwhile, the company's restructuring and liability management practice has been working with a number of high-profile clients including Rite Aid and SVB Financial Group.
At larger rivals Goldman Sachs GS.N and Morgan Stanley MS.N quarterly investment banking revenues rose 21% and 51%, respectively.
Lazard posted net income of $50 million, or 49 cents a share, in the second quarter. That compares with a loss of $124 million, or $1.41 a share, a year earlier.
On an adjusted basis, the company's profit of 52 cents a share surpassed analysts' average estimate of 35 cents a share, according to LSEG.
Orszag, who previously served as the director of the office of management and budget in the Obama administration, said clients were still pursuing deals despite a busy calendar of elections this year that could shift policies in many nations, including the United States.
"Boards and C-suites are willing to proceed, period, perhaps in expectation that there will be a change in the regulatory environment" under either U.S. presidential candidate, or at least a continuation of the status quo. "If you're willing to proceed today, you go ahead and do it."
Lazard is also considering its own deals to grow its asset management business.
"We are very actively looking at a variety of inorganic options to expand the asset business outside of public markets, that includes both acquisitions and... partnerships, so we are very much in the mix," Orszag said, although valuations remain high.
Reporting by Manya Saini in Bengaluru and Lananh Nguyen in New York; Editing by Maju Samuel and Christina Fincher
면책조항: XM Group 회사는 체결 전용 서비스와 온라인 거래 플랫폼에 대한 접근을 제공하여, 개인이 웹사이트에서 또는 웹사이트를 통해 이용 가능한 콘텐츠를 보거나 사용할 수 있도록 허용합니다. 이에 대해 변경하거나 확장할 의도는 없습니다. 이러한 접근 및 사용에는 다음 사항이 항상 적용됩니다: (i) 이용 약관, (ii) 위험 경고, (iii) 완전 면책조항. 따라서, 이러한 콘텐츠는 일반적인 정보에 불과합니다. 특히, 온라인 거래 플랫폼의 콘텐츠는 금융 시장에서의 거래에 대한 권유나 제안이 아닙니다. 금융 시장에서의 거래는 자본에 상당한 위험을 수반합니다.
온라인 거래 플랫폼에 공개된 모든 자료는 교육/정보 목적으로만 제공되며, 금융, 투자세 또는 거래 조언 및 권고, 거래 가격 기록, 금융 상품 또는 원치 않는 금융 프로모션의 거래 제안 또는 권유를 포함하지 않으며, 포함해서도 안됩니다.
이 웹사이트에 포함된 모든 의견, 뉴스, 리서치, 분석, 가격, 기타 정보 또는 제3자 사이트에 대한 링크와 같이 XM이 준비하는 콘텐츠 뿐만 아니라, 제3자 콘텐츠는 일반 시장 논평으로서 "현재" 기준으로 제공되며, 투자 조언으로 여겨지지 않습니다. 모든 콘텐츠가 투자 리서치로 해석되는 경우, 투자 리서치의 독립성을 촉진하기 위해 고안된 법적 요건에 따라 콘텐츠가 의도되지 않았으며, 준비되지 않았다는 점을 인지하고 동의해야 합니다. 따라서, 관련 법률 및 규정에 따른 마케팅 커뮤니케이션이라고 간주됩니다. 여기에서 접근할 수 있는 앞서 언급한 정보에 대한 비독립 투자 리서치 및 위험 경고 알림을 읽고, 이해하시기 바랍니다.
