Evercore Inc. - FORM 8-K - EX-99.1

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8-K - FORM 8-K - Evercore Inc.	d126558d8k.htm

Exhibit 99.1

E V E R C O R E

EVERCORE REPORTS RECORD FULL YEAR AND FOURTH QUARTER RESULTS;

QUARTERLY DIVIDEND OF $0.31 PER SHARE

Highlights

•

Full Year Financial Summary

•

Record U.S. GAAP Net Revenues of $1.223 billion, up 34% compared to 2014

•

U.S. GAAP Net Income Attributable to Evercore Partners Inc. of $42.9 million, down 51% compared to 2014, or $0.98 per share, down 53% compared to 2014

•

Record Adjusted Pro Forma Net Revenues of $1.216 billion, up 33% compared to 2014

•

Record Adjusted Pro Forma Net Income Attributable to Evercore Partners Inc. of $171 million, up 38% compared to 2014, or $3.23 per share, up 25% compared to 2014

•

Fourth Quarter Financial Summary

•

Record U.S. GAAP Net Revenues of $408 million, up 27% compared to Q4 2014

•

U.S. GAAP Net Income Attributable to Evercore Partners Inc. of $20.6 million, down 26% compared to Q4 2014, or $0.45 per share, down 32% compared to Q4 2014

•

Record Adjusted Pro Forma Net Revenues of $404 million, up 26% compared to Q4 2014

•

Record Adjusted Pro Forma Net Income Attributable to Evercore Partners Inc. of $65 million, up 41% compared to Q4 2014, or $1.22 per share, up 36% compared to Q4 2014

•

Investment Banking

•

Announced two Advisory Senior Managing Directors in the first quarter; Bill Anderson, who will head the Firm’s Strategic Shareholder Advisory Business, and Jim Renwick, who will lead the European Equity Capital Markets Advisory capability.

•

Advising clients on significant transactions globally:

•

Advised DuPont on its successful defense in the largest proxy contest ever taken to a vote

•

Advising on two of the five largest M&A transactions announced in the US in 2015: DuPont on its $68 billion merger of equals with The Dow Chemical Company and EMC on its $67 billion sale to Dell and its owners

•

Advising Shire plc on its $34.9 billion acquisition of Baxalta Incorporated, as well as its $6.2 billion acquisition of Dyax Corp

•

Advising the Board of Directors of Targa Resources Corp. on its acquisition of Targa Resources Partners LP

•

Advising Cable & Wireless Communications Plc on its sale to Liberty Global plc

•

Advised Chesapeake Energy Corporation on its $3.9 billion Senior Notes exchange offer

•

Completed the first full year of operations of Evercore ISI, growing secondary and underwriting revenues and delivering full year operating margins of 19.0%

•

Investment Management

•

Completed the restructuring of our investment in Atalanta Sosnoff. After this restructuring, Assets Under Management in consolidated businesses were $8.2 billion

•

Returned $334.5 million of capital to shareholders during the year through dividends and repurchases, including $146.0 million in the fourth quarter. Quarterly dividend of $0.31 per share

NEW YORK, February 3, 2016 – Evercore Partners Inc. (NYSE: EVR) today announced that its U.S. GAAP Net Revenues were a record $1.223 billion for the twelve months ended December 31, 2015, an increase of 34% compared to $915.9 million for the twelve months ended December 31, 2014. U.S. GAAP Net Revenues were a record $408.2 million for the quarter ended December 31, 2015, compared to $321.9 million for the quarter ended December 31, 2014. U.S. GAAP Net Income Attributable to Evercore Partners Inc. for the twelve months ended December 31, 2015 was $42.9 million, or $0.98 per share, compared to $86.9 million, or $2.08 per share, for the same period last year. U.S. GAAP Net Income Attributable to Evercore Partners Inc. for the fourth quarter was $20.6 million, or $0.45 per share, compared to $27.7 million, or $0.66 per share, a year ago.

Adjusted Pro Forma Net Revenues were a record $1.216 billion for the twelve months ended December 31, 2015, an increase of 33% compared to $911.9 million for the twelve months ended December 31, 2014. Adjusted Pro Forma Net Revenues were a record $404.1 million for the quarter ended December 31, 2015, an increase of 26% compared to $320.9 million for the quarter ended December 31, 2014. Adjusted Pro Forma Net Income Attributable to Evercore Partners Inc. was a record $171.3 million for the twelve months ended December 31, 2015, up 38% compared to $124.3 million for the same period last year. Adjusted Pro Forma earnings per share was $3.23 for the twelve months ended December 31, 2015, up 25% in comparison to the prior year period. Adjusted Pro Forma Net Income Attributable to Evercore Partners Inc. was a record $64.7 million for the fourth quarter, up 41% compared to $45.9 million a year ago. Adjusted Pro Forma earnings per share was $1.22 for the quarter, up 36% in comparison to the prior year period.

The U.S. GAAP trailing twelve-month compensation ratio of 64.4% compares to 60.0% for the same period in 2014. The U.S. GAAP compensation ratio for the three months ended December 31, 2015 was 62.3%, compared to 59.7% for the quarter ended December 31, 2014. The Adjusted Pro Forma compensation ratio for the trailing twelve months was 57.8%, compared to 59.0% for the same period in 2014. The Adjusted Pro Forma compensation ratio for the current quarter was 58.6%, compared to 58.3% for the quarter ended December 31, 2014.

Evercore’s quarterly results may fluctuate significantly due to the timing and amount of transaction fees earned, as well as other factors. Accordingly, financial results in any particular quarter may not be representative of future results over a longer period of time.

“Evercore’s fourth quarter and full year 2015 results reflect solid performance by our Investment Banking business. We delivered our seventh consecutive year of significant growth in revenues and earnings and returned more than $334 million to our shareholders,” said Ralph Schlosstein, President and Chief Executive Officer. “Our advisory business performed strongly in key industry sectors, including Energy, Healthcare, Financial Institutions and TMT, with our European team delivering particularly strong growth. Our equity capital markets business grew revenues by more than 40%, serving as a bookrunner in a number of significant transactions. And our Evercore ISI team successfully executed our integration plan, growing revenues in the second half and sustaining that momentum in the early days of 2016. Our results are a testament to the investments we have made in the firm and our people, and our expanded capabilities to serve our growing client base around the globe.”

“This past year was a strong one for M&A volume around the world. And, Evercore advised on a series of the largest and most prominent transactions. Overall, our advisory business enjoyed the strongest results in the Firm’s history,” said Roger C. Altman, Executive Chairman.

Consolidated U.S. GAAP and Adjusted Pro Forma Selected Financial Data (Unaudited)


	U.S. GAAP
	Three Months Ended									% Change vs.						Twelve Months Ended
	December 31, 2015			September 30, 2015			December 31, 2014			September 30, 2015			December 31, 2014			December 31, 2015			December 31, 2014			% Change
	(dollars in thousands)
Net Revenues	$	408,243		$	308,951		$	321,888			32	%		27	%	$	1,223,273		$	915,858			34	%
Operating Income	$	74,663		$	11,898		$	67,852			528	%		10	%	$	128,670		$	170,947			(25	%)
Net Income Attributable to Evercore Partners Inc.	$	20,602		$	7,197		$	27,732			186	%		(26	%)	$	42,863		$	86,874			(51	%)
Diluted Earnings Per Share	$	0.45		$	0.16		$	0.66			181	%		(32	%)	$	0.98		$	2.08			(53	%)
Compensation Ratio		62.3	%		63.9	%		59.7	%								64.4	%		60.0	%
Operating Margin		18.3	%		3.9	%		21.1	%								10.5	%		18.7	%

	Adjusted Pro Forma
	Three Months Ended									% Change vs.						Twelve Months Ended
	December 31, 2015			September 30, 2015			December 31, 2014			September 30, 2015			December 31, 2014			December 31, 2015			December 31, 2014			% Change
	(dollars in thousands)
Net Revenues	$	404,129		$	305,633		$	320,929			32	%		26	%	$	1,216,421		$	911,926			33	%
Operating Income	$	109,831		$	73,454		$	80,940			50	%		36	%	$	292,514		$	210,205			39	%
Net Income Attributable to Evercore Partners Inc.	$	64,717		$	42,934		$	45,900			51	%		41	%	$	171,307		$	124,279			38	%
Diluted Earnings Per Share	$	1.22		$	0.81		$	0.90			51	%		36	%	$	3.23		$	2.59			25	%
Compensation Ratio		58.6	%		57.4	%		58.3	%								57.8	%		59.0	%
Operating Margin		27.2	%		24.0	%		25.2	%								24.0	%		23.1	%

Throughout the discussion of Evercore’s business segments, information is presented on an Adjusted Pro Forma basis, which is an unaudited non-generally accepted accounting principles (“non-GAAP”) measure. Adjusted Pro Forma results begin with information prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), and then those results are adjusted to exclude certain items and reflect the conversion of vested and unvested Evercore LP Units and Interests into Class A shares. Evercore believes that the disclosed Adjusted Pro Forma measures and any adjustments thereto, when presented in conjunction with comparable U.S. GAAP measures, are useful to investors to compare Evercore’s results across several periods and facilitate an understanding of Evercore’s operating results. Evercore uses these measures to evaluate its operating performance, as well as the performance of individual employees. These measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with U.S. GAAP. For more information about the Adjusted Pro Forma basis of reporting used by management to evaluate the performance of Evercore and each line of business, including reconciliations of U.S. GAAP results to an Adjusted Pro Forma basis, see pages A-2 through A-11 included in Annex I. These Adjusted Pro Forma amounts are allocated to the Company’s two business segments: Investment Banking and Investment Management.

Business Line Reporting

Investment Banking


	U.S. GAAP
	Three Months Ended									% Change vs.						Twelve Months Ended
	December 31, 2015			September 30, 2015			December 31, 2014			September 30, 2015			December 31, 2014			December 31, 2015			December 31, 2014			% Change
	(dollars in thousands)
Net Revenues:
Investment Banking Revenues	$	384,111		$	285,561		$	298,426			35	%		29	%	$	1,133,860		$	821,359			38	%
Other Revenue, net		(71	)		357			(991	)		NM			93	%		(2,945	)		(1,722	)		(71	%)

Net Revenues		384,040			285,918			297,435			34	%		29	%		1,130,915			819,637			38	%

Expenses:
Employee Compensation and Benefits		241,389			184,372			177,206			31	%		36	%		734,078			492,649			49	%
Non-compensation Costs		65,283			66,324			52,558			(2	%)		24	%		241,811			160,494			51	%
Special Charges		—			—			1,161			NM			NM			2,151			4,893			(56	%)

Total Expenses		306,672			250,696			230,925			22	%		33	%		978,040			658,036			49	%

Operating Income	$	77,368		$	35,222		$	66,510			120	%		16	%	$	152,875		$	161,601			(5	%)

Compensation Ratio		62.9	%		64.5	%		59.6	%								64.9	%		60.1	%
Operating Margin		20.1	%		12.3	%		22.4	%								13.5	%		19.7	%


	Adjusted Pro Forma
	Three Months Ended									% Change vs.						Twelve Months Ended
	December 31, 2015			September 30, 2015			December 31, 2014			September 30, 2015			December 31, 2014			December 31, 2015			December 31, 2014			% Change
	(dollars in thousands)
Net Revenues:
Investment Banking Revenues	$	376,872		$	278,436		$	293,363			35	%		28	%	$	1,112,287		$	804,152			38	%
Other Revenue, net		1,081			1,809			436			(40	%)		148	%		3,202			3,129			2	%

Net Revenues		377,953			280,245			293,799			35	%		29	%		1,115,489			807,281			38	%

Expenses:
Employee Compensation and Benefits		223,839			162,392			172,239			38	%		30	%		648,868			481,311			35	%
Non-compensation Costs		51,283			51,576			44,753			(1	%)		15	%		197,882			133,914			48	%

Total Expenses		275,122			213,968			216,992			29	%		27	%		846,750			615,225			38	%

Operating Income	$	102,831		$	66,277		$	76,807			55	%		34	%	$	268,739		$	192,056			40	%

Compensation Ratio		59.2	%		57.9	%		58.6	%								58.2	%		59.6	%
Operating Margin		27.2	%		23.6	%		26.1	%								24.1	%		23.8	%

For the fourth quarter, Evercore’s Investment Banking segment reported Net Revenues of $378.0 million, which represents an increase of 29% year-over-year. Operating Income of $102.8 million increased 34% from the fourth quarter of last year. Operating Margins were 27.2% in comparison to 26.1% for the fourth quarter of last year. For the twelve months ended December 31, 2015, Investment Banking reported Net Revenues of $1.115 billion, an increase of 38% from last year. Year-to-date Operating Income of $268.7 million compared to $192.1 million last year, an increase of 40%. Year-to-date Operating Margins were 24.1% compared to 23.8% last year.

Revenues


	Adjusted Pro Forma
	Three Months Ended						% Change vs.						Twelve Months Ended
	December 31, 2015		September 30, 2015		December 31, 2014		September 30, 2015			December 31, 2014			December 31, 2015		December 31, 2014		% Change
	(dollars in thousands)
Advisory Fees	$	304,383	$	215,657	$	240,042		41	%		27	%	$	843,921	$	710,471		19	%
Commissions and Related Fees		63,866		58,264		43,957		10	%		45	%		228,229		65,580		248	%
Underwriting Fees		8,623		4,515		9,364		91	%		(8	%)		40,137		28,101		43	%

Total Investment Banking Revenue	$	376,872	$	278,436	$	293,363		35	%		28	%	$	1,112,287	$	804,152		38	%

During the quarter, Investment Banking earned advisory fees from 222 client transactions (vs. 201 in Q4 2014) and fees in excess of $1 million from 68 client transactions (vs. 63 in Q4 2014). For the twelve months ended December 31, 2015, Investment Banking earned advisory fees from 484 client transactions (vs. 418 last year) and fees in excess of $1 million from 180 client transactions (vs. 173 last year).

During the fourth quarter of 2015, Commissions and Related Fees of $63.9 million increased 45% from last year, reflecting the inclusion of a full quarter’s results from the acquisition of ISI. Underwriting Fees of $8.6 million for the three months ended December 31, 2015 decreased 8% versus the prior year. During the twelve months ended December 31, 2015, Commissions and Related Fees of $228.2 million increased 248% from last year, reflecting the inclusion of a full year’s results from the acquisition of ISI. Underwriting Fees of $40.1 million for the twelve months ended December 31, 2015 increased 43% versus the prior year.

Evercore ISI, our U.S. equities business, reported Net Revenues of $245.5 million, including allocated U.S. underwriting revenues of $18.8 million for the twelve months ended December 31, 2015. Operating margins as contemplated for the performance targets of the Class G and H LP Interests, giving effect to just Commissions and Related Fees, for the twelve months ended December 31, 2015 were consistent with those assumed at the time of the closing of the transactions.

Expenses

Compensation costs were $223.8 million for the fourth quarter, an increase of 30% year-over-year. The trailing twelve-month compensation ratio was 58.2%, down from 59.6% a year ago. Evercore’s Investment Banking compensation ratio was 59.2% for the fourth quarter, up versus the compensation ratio reported for the three months ended December 31, 2014 of 58.6%. Year to-date compensation costs were $648.9 million, an increase of 35% from the prior year.

Non-compensation costs for the current quarter were $51.3 million, up 15% from the same period last year. The increase in non-compensation costs versus the same period in the prior year reflects the addition of personnel within most parts of the business, increased new business costs associated with higher levels of global transaction activity and higher professional fees. The ratio of non-compensation costs to net revenue for the current quarter was 13.6%, compared to 15.2% in the same quarter last year. Year-to-date non-compensation costs were $197.9 million, up 48% from the prior year. The ratio of non-compensation costs to revenue for the twelve months ended December 31, 2015 was 17.7%, compared to 16.6% last year, driven primarily by the higher non-compensation costs in the Evercore ISI equities business.

Investment Management


	U.S. GAAP
	Three Months Ended									% Change vs.						Twelve Months Ended
	December 31, 2015			September 30, 2015			December 31, 2014			September 30, 2015			December 31, 2014			December 31, 2015			December 31, 2014			% Change
	(dollars in thousands)
Net Revenues:
Investment Management Revenues	$	24,731		$	23,812		$	25,258			4	%		(2	%)	$	95,129		$	98,751			(4	%)
Other Revenue, net		(528	)		(779	)		(805	)		32	%		34	%		(2,771	)		(2,530	)		(10	%)

Net Revenues		24,203			23,033			24,453			5	%		(1	%)		92,358			96,221			(4	%)

Expenses:
Employee Compensation and Benefits		13,141			13,003			15,011			1	%		(12	%)		54,097			56,867			(5	%)
Non-compensation Costs		6,122			5,354			8,100			14	%		(24	%)		23,473			30,008			(22	%)
Special Charges		7,645			28,000			—			(73	%)		NM			38,993			—			NM

Total Expenses		26,908			46,357			23,111			(42	%)		16	%		116,563			86,875			34	%

Operating Income (Loss)	$	(2,705	)	$	(23,324	)	$	1,342			88	%		NM		$	(24,205	)	$	9,346			NM

Compensation Ratio		54.3	%		56.5	%		61.4	%								58.6	%		59.1	%
Operating Margin		(11.2	%)		(101.3	%)		5.5	%								(26.2	%)		9.7	%


	Adjusted Pro Forma
	Three Months Ended									% Change vs.						Twelve Months Ended
	December 31, 2015			September 30, 2015			December 31, 2014			September 30, 2015			December 31, 2014			December 31, 2015			December 31, 2014			% Change
	(dollars in thousands)
Net Revenues:
Investment Management Revenues	$	26,002		$	25,205		$	26,985			3	%		(4	%)	$	100,127		$	103,385			(3	%)
Other Revenue, net		174			183			145			(5	%)		20	%		805			1,260			(36	%)

Net Revenues		26,176			25,388			27,130			3	%		(4	%)		100,932			104,645			(4	%)

Expenses:
Employee Compensation and Benefits		13,141			13,003			15,011			1	%		(12	%)		54,097			56,867			(5	%)
Non-compensation Costs		6,035			5,208			7,986			16	%		(24	%)		23,060			29,629			(22	%)

Total Expenses		19,176			18,211			22,997			5	%		(17	%)		77,157			86,496			(11	%)

Operating Income	$	7,000		$	7,177		$	4,133			(2	%)		69	%	$	23,775		$	18,149			31	%

Compensation Ratio		50.2	%		51.2	%		55.3	%								53.6	%		54.3	%
Operating Margin		26.7	%		28.3	%		15.2	%								23.6	%		17.3	%

Assets Under Management (in millions) (1)	$	8,168		$	13,329		$	14,048			(39	%)		(42	%)	$	8,168		$	14,048			(42	%)

(1)	Assets Under Management reflect end of period amounts from our consolidated subsidiaries and therefore exclude AUM of $5,297 million from Atalanta Sosnoff at December 31, 2015.

For the fourth quarter, Investment Management reported Net Revenues and Operating Income of $26.2 million and $7.0 million, respectively. Investment Management reported a fourth quarter Operating Margin of 26.7%. For the twelve months ended December 31, 2015, Investment Management reported Net Revenues and Operating Income of $100.9 million and $23.8 million, respectively. The year-to-date Operating Margin was 23.6%, compared to 17.3% last year.

As of December 31, 2015, including Atalanta Sosnoff, Investment Management reported $13.5 billion of AUM, an increase of 1% from September 30, 2015. On December 31, 2015 the Company restructured its investment in Atalanta Sosnoff such that its results will be reflected on the equity method of accounting in 2016. Had this been done at the beginning of 2015, it would have reduced revenues in the Investment Management business by $21.6 million, without a significant effect on operating income. AUM excluding Atalanta Sosnoff was $8.2 billion at December 31, 2015.

Revenues

Investment Management Revenue


	Adjusted Pro Forma
	Three Months Ended						% Change vs.						Twelve Months Ended
	December 31, 2015		September 30, 2015		December 31, 2014		September 30, 2015			December 31, 2014			December 31, 2015		December 31, 2014		% Change
	(dollars in thousands)
Investment Advisory and Management Fees
Wealth Management	$	8,831	$	8,650	$	8,235		2	%		7	%	$	34,659	$	30,827		12	%
Institutional Asset Management (1)		12,129		11,088		11,418		9	%		6	%		46,026		45,821		—	%
Private Equity		1,390		1,391		2,023		—	%		(31	%)		5,603		8,127		(31	%)

Total Investment Advisory and Management Fees		22,350		21,129		21,676		6	%		3	%		86,288		84,775		2	%

Realized and Unrealized Gains
Institutional Asset Management		549		686		1,325		(20	%)		(59	%)		3,681		6,067		(39	%)
Private Equity		1,827		1,933		2,225		(5	%)		(18	%)		5,086		7,858		(35	%)

Total Realized and Unrealized Gains		2,376		2,619		3,550		(9	%)		(33	%)		8,767		13,925		(37	%)

Equity in Earnings of Affiliates (2)		1,276		1,457		1,759		(12	%)		(27	%)		5,072		4,685		8	%

Investment Management Revenues	$	26,002	$	25,205	$	26,985		3	%		(4	%)	$	100,127	$	103,385		(3	%)

(1)

Management fees from Institutional Asset Management were $12.1 million, $11.2 million and $11.5 million for the three months ended December 31, 2015, September 30, 2015 and December 31, 2014, respectively, and $46.1 million and $45.9 million for the twelve months ended December 31, 2015 and 2014, respectively, on a U.S. GAAP basis, excluding the reduction of revenues for client-related expenses.

(2)	Equity in G5 \| Evercore - Wealth Management and ABS on a U.S. GAAP basis are reclassified from Investment Management Revenue to Income from Equity Method Investments.

Investment Advisory and Management Fees of $22.4 million for the quarter ended December 31, 2015 increased 3% compared to the same period a year ago, driven primarily by higher fees in Wealth Management and Institutional Asset Management, partially offset by lower fees in Private Equity.

Realized and Unrealized Gains of $2.4 million in the quarter decreased relative to the prior year, with the change relative to the prior period driven principally by lower Institutional Asset Management gains.

Equity in Earnings of Affiliates of $1.3 million in the quarter decreased relative to the prior year principally as a result of lower income earned in the fourth quarter of 2015 by ABS and G5 | Evercore.

Expenses

Investment Management’s fourth quarter expenses were $19.2 million, down 17% compared to the fourth quarter of 2014. Year-to-date Investment Management expenses were $77.2 million, down 11% from a year ago.

Other U.S. GAAP Adjustments

Evercore’s Adjusted Pro Forma Net Income Attributable to Evercore Partners Inc. for the three and twelve months ended December 31, 2015 was higher than U.S. GAAP as a result of the exclusion of expenses associated with awards granted in conjunction with certain of the Company’s acquisitions, Special Charges, certain other business acquisition-related charges and professional fees.

Acquisition-related compensation charges for 2015 include expenses associated with performance-based awards granted in conjunction with the Company’s acquisition of ISI. The amount of expense is based on the determination that it is probable that Evercore ISI will achieve certain earnings and margin targets in future periods.

Special Charges for 2015 include charges resulting from the restructuring of our investment in Atalanta Sosnoff in the fourth quarter, primarily related to the conversion of certain of Atalanta Sosnoff’s profits interests held by management to equity interests. Special Charges for 2015 also include a charge for the impairment of goodwill in the Institutional Asset Management reporting unit, charges related to separation benefits and costs associated with the termination of certain contracts within Evercore ISI, as well as a charge related to the finalization of a matter associated with the wind-down of the Company’s U.S. Private Equity business.

Acquisition and Transition charges for 2015 include professional fees incurred and costs related to transitioning ISI’s infrastructure, including certain regulatory settlements. Acquisition-related charges for 2015 also include adjustments to contingent consideration related to certain acquisitions.

In addition, for Adjusted Pro Forma purposes, client related expenses have been presented as a reduction from Revenues and Non-compensation costs.

Evercore’s Adjusted Pro Forma Diluted Shares Outstanding for the three and twelve months ended December 31, 2015 were higher than U.S. GAAP as a result of the inclusion of Evercore LP partnership units, as well as the assumed vesting of certain acquisition-related shares, LP Units/Interests and unvested restricted stock units granted to Lexicon and ISI employees.

Further details of these adjustments, as well as an explanation of similar amounts for the three and twelve months ended December 31, 2014 and the three months ended September 30, 2015, are included in Annex I, pages A-2 to A-11.

Non-controlling Interests

Non-controlling Interests in certain operating subsidiaries are owned by the principals and strategic investors in these businesses. Evercore’s equity ownership percentages in these operating businesses range from 61% to 72%. For the periods ended December 31, 2015, September 30, 2015 and December 31, 2014 the gain (loss) allocated to non-controlling interests was as follows:


	Net Gain (Loss) Allocated to Noncontrolling Interests
	Three Months Ended						Twelve Months Ended
	December 31, 2015		September 30, 2015		December 31, 2014		December 31, 2015		December 31, 2014
	(dollars in thousands)
Segment
Investment Banking (1)	$	1,621	$	248	$	1,315	$	1,956	$	(2,885	)
Investment Management (1)		1,201		1,360		965		4,000		4,032

Total	$	2,822	$	1,608	$	2,280	$	5,956	$	1,147

(1)

The difference between Adjusted Pro Forma and U.S. GAAP Noncontrolling Interests relates primarily to the allocation of income to noncontrolling interests held at Evercore LP and intangible amortization expense for certain acquisitions, which we exclude from the Adjusted Pro Forma results. See pages A-2 through A-3 for further information.

Income Taxes

For the three and twelve months ended December 31, 2015, Evercore’s Adjusted Pro Forma effective tax rate was 37.5% and 37.3%, respectively, compared to 38.8% and 37.8%, respectively, for the three and twelve months ended December 31, 2014. Changes in the effective tax rate are principally driven by the level of earnings in businesses with minority owners and earnings generated outside of the U.S.

For the three and twelve months ended December 31, 2015, Evercore’s U.S. GAAP effective tax rate was approximately 60.9% and 57.2%, respectively, compared to 43.9% and 39.0%, respectively, for the three and twelve months ended December 31, 2014. The effective tax rate for U.S. GAAP purposes for 2015 reflects significant adjustments relating to the tax treatment of compensation associated with Evercore LP Units/Interests, state, local and foreign taxes, and other adjustments.

Balance Sheet

The Company continues to maintain a strong balance sheet, holding cash, cash equivalents and marketable securities of $492.6 million at December 31, 2015. Current assets exceed current liabilities by $341.0 million at December 31, 2015. Amounts due related to the Long-Term Notes Payable and Subordinated Borrowings were $141.8 million at December 31, 2015.

Capital Transactions

On February 1, 2016, the Board of Directors of Evercore declared a quarterly dividend of $0.31 per share to be paid on March 11, 2016 to common stockholders of record on February 26, 2016.

During the three months ended December 31, 2015 the Company repurchased approximately 2.5 million shares at an average cost per share of $52.60, including 2.4 million shares from our transaction with Mizuho on November 10, 2015, and a total of 5.5 million shares/units in the twelve months ended December 31, 2015 at an average price of $51.66.

Conference Call

Evercore will host a related conference call beginning at 8:00 a.m. Eastern Time, Wednesday, February 3, 2016, accessible via telephone and the internet. Investors and analysts may participate in the live conference call by dialing (877) 359-9508 (toll-free domestic) or (224) 357-2393 (international); passcode: 30834334. Please register at least 10 minutes before the conference call begins. A replay of the call will be available for one week via telephone starting approximately one hour after the call ends. The replay can be accessed at (855) 859-2056 (toll-free domestic) or (404) 537-3406 (international); passcode: 30834334. A live webcast of the conference call will be available on the Investor Relations section of Evercore’s website at www.evercore.com. The webcast will be archived on Evercore’s website for 30 days after the call.

About Evercore

Established in 1995, Evercore is a leading global independent investment banking advisory firm. Evercore advises a diverse set of investment banking clients on a wide range of transactions and issues and provides institutional investors with high quality equity research, sales and trading execution that is free of the conflicts created by proprietary activities. The firm also offers

investment management services to high net worth and institutional investors. With 28 offices in North America, Europe, South America and Asia, Evercore has the scale and strength to serve clients globally through a focused and tailored approach designed to meet their unique needs. More information about Evercore can be found on the Company’s website at www.evercore.com.


Investor Contact:		Robert B. Walsh
		Chief Financial Officer, Evercore
		+1.212.857.3100

Media Contact:		Dana Gorman
		The Abernathy MacGregor Group, for Evercore
		+1.212.371.5999

Basis of Alternative Financial Statement Presentation

Adjusted Pro Forma results are a non-GAAP measure. Evercore believes that the disclosed Adjusted Pro Forma measures and any adjustments thereto, when presented in conjunction with comparable U.S. GAAP measures, are useful to investors to compare Evercore’s results across several periods and better reflect management’s view of operating results. These measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with U.S. GAAP. A reconciliation of U.S. GAAP results to Adjusted Pro Forma results is presented in the tables included in Annex I.

Forward-Looking Statements

This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, which reflect our current views with respect to, among other things, Evercore’s operations and financial performance. In some cases, you can identify these forward-looking statements by the use of words such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or the negative version of these words or other comparable words. All statements other than statements of historical fact included in this presentation are forward-looking statements and are based on various underlying assumptions and expectations and are subject to known and unknown risks, uncertainties and assumptions, and may include projections of our future financial performance based on our growth strategies and anticipated trends in Evercore’s business. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. Evercore believes these factors include, but are not limited to, those described under “Risk Factors” discussed in Evercore’s Annual Report on Form 10-K for the year ended December 31, 2014, subsequent quarterly reports on Form 10-Q, current reports on Form 8-K and Registration Statements. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this release. In addition, new risks and uncertainties emerge from time to time, and it is not possible for Evercore to predict all risks and uncertainties, nor can Evercore assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Accordingly, you should not rely upon forward-looking statements as a prediction of actual results and Evercore does not assume any responsibility for the accuracy or completeness of any of these forward-looking statements. Evercore undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.

With respect to any securities offered by any private equity fund referenced herein, such securities have not been and will not be registered under the Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.

ANNEX I


Schedule		Page Number
Unaudited Condensed Consolidated Statements of Operations for the Three and Twelve Months Ended December 31, 2015 and 2014		A-1
Adjusted Pro Forma:
Adjusted Pro Forma Results (Unaudited)		A-2
U.S. GAAP Reconciliation to Adjusted Pro Forma (Unaudited)		A-4
U.S. GAAP Segment Reconciliation to Adjusted Pro Forma for the Three and Twelve Months ended December 31, 2015 (Unaudited)		A-6
U.S. GAAP Segment Reconciliation to Adjusted Pro Forma for the Three Months ended September 30, 2015 (Unaudited)		A-7
U.S. GAAP Segment Reconciliation to Adjusted Pro Forma for the Three and Twelve Months ended December 31, 2014 (Unaudited)		A-8
Notes to Unaudited Condensed Consolidated Adjusted Pro Forma Financial Data		A-9

EVERCORE PARTNERS INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

THREE AND TWELVE MONTHS ENDED DECEMBER 31, 2015 AND 2014

(dollars in thousands, except per share data)

(UNAUDITED)


	Three Months Ended December 31,				Twelve Months Ended December 31,
	2015		2014		2015		2014
Revenues
Investment Banking Revenue	$	384,111	$	298,426	$	1,133,860	$	821,359
Investment Management Revenue		24,731		25,258		95,129		98,751
Other Revenue		2,603		2,431		11,259		11,292

Total Revenues		411,445		326,115		1,240,248		931,402
Interest Expense (1)		3,202		4,227		16,975		15,544

Net Revenues		408,243		321,888		1,223,273		915,858

Expenses
Employee Compensation and Benefits		254,530		192,217		788,175		549,516
Occupancy and Equipment Rental		12,072		11,581		47,703		41,202
Professional Fees		14,810		14,068		50,817		45,429
Travel and Related Expenses		16,251		12,957		55,388		40,015
Communications and Information Services		8,777		7,549		36,372		18,818
Depreciation and Amortization		6,815		5,397		27,927		16,263
Special Charges		7,645		1,161		41,144		4,893
Acquisition and Transition Costs		2,951		590		4,890		5,828
Other Operating Expenses		9,729		8,516		42,187		22,947

Total Expenses		333,580		254,036		1,094,603		744,911

Income Before Income from Equity Method Investments and Income Taxes		74,663		67,852		128,670		170,947
Income from Equity Method Investments		2,016		1,799		6,050		5,180

Income Before Income Taxes		76,679		69,651		134,720		176,127
Provision for Income Taxes		46,703		30,542		77,030		68,756

Net Income		29,976		39,109		57,690		107,371
Net Income Attributable to Noncontrolling Interest		9,374		11,377		14,827		20,497

Net Income Attributable to Evercore Partners Inc.	$	20,602	$	27,732	$	42,863	$	86,874

Net Income Attributable to Evercore Partners Inc. Common Shareholders	$	20,602	$	27,732	$	42,863	$	86,874

Weighted Average Shares of Class A Common Stock Outstanding:
Basic		38,681		36,337		37,161		35,827
Diluted		45,480		41,912		43,699		41,843

Net Income Per Share Attributable to Evercore Partners Inc. Common Shareholders:
Basic	$	0.53	$	0.76	$	1.15	$	2.42
Diluted	$	0.45	$	0.66	$	0.98	$	2.08

(1)	Includes interest expense on long-term debt and interest expense on short-term repurchase agreements.

A-1

Adjusted Pro Forma Results

Throughout the discussion of Evercore’s business segments, information is presented on an Adjusted Pro Forma basis, which is a non-generally accepted accounting principles (“non-GAAP”) measure. Adjusted Pro Forma results begin with information prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), adjusted to exclude certain items and reflect the conversion of vested and unvested Evercore LP Units, other IPO related restricted stock unit awards, as well as Acquisition Related Share Issuances and Unvested Restricted Stock Units granted to Lexicon and ISI employees, into Class A shares. Evercore believes that the disclosed Adjusted Pro Forma measures and any adjustments thereto, when presented in conjunction with comparable U.S. GAAP measures, are useful to investors to compare Evercore’s results across several periods and facilitate an understanding of Evercore’s operating results. The Company uses these measures to evaluate its operating performance, as well as the performance of individual employees. These measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with U.S. GAAP. These Adjusted Pro Forma amounts are allocated to the Company’s two business segments: Investment Banking and Investment Management. The differences between Adjusted Pro Forma and U.S. GAAP results are as follows:

Assumed Vesting of Evercore LP Units and Exchange into Class A Shares. The Company incurred expenses, in Employee Compensation and Benefits, resulting from the vesting of Class E LP Units issued in conjunction with the acquisition of ISI, as well as Class G and H LP Interests. The amount of expense for the Class G and H LP Interests is based on the determination that it is probable that Evercore ISI will achieve certain earnings and margin targets in 2015 and in future periods. The Adjusted Pro Forma results assume these LP Units and certain Class G and H LP Interests have vested and have been exchanged for Class A shares. Accordingly, any expense associated with these units, and related awards, is excluded from Adjusted Pro Forma results, and the noncontrolling interest related to these units is converted to controlling interest. The Company’s Management believes that it is useful to provide the per-share effect associated with the assumed conversion of these previously granted equity interests, and thus the Adjusted Pro Forma results reflect the exchange of certain vested and unvested Evercore LP partnership units and interests and IPO related restricted stock unit awards into Class A shares.

Adjustments Associated with Business Combinations. The following charges resulting from business combinations have been excluded from Adjusted Pro Forma results because the Company’s Management believes that operating performance is more comparable across periods excluding the effects of these acquisition-related charges:

Amortization of Intangible Assets and Other Purchase Accounting-related Amortization. Amortization of intangible assets and other purchase accounting-related amortization from the acquisitions of ISI, SFS and certain other acquisitions.

Compensation Charges. Expenses for deferred consideration issued to the sellers of certain of the Company’s acquisitions.

Acquisition and Transition Costs. Primarily professional fees incurred and costs related to transitioning ISI’s infrastructure, including certain regulatory settlements.

Fair Value of Contingent Consideration. The expense associated with changes in the fair value of contingent consideration issued to the sellers of certain of the Company’s acquisitions is excluded from Adjusted Pro Forma results.

Client Related Expenses. Client related expenses and provisions for uncollected receivables have been classified as a reduction of revenue in the Adjusted Pro Forma presentation. The Company’s Management believes that this adjustment results in more meaningful key operating ratios, such as compensation to net revenues and operating margin.

A-2

Professional Fees. The expense associated with share-based awards resulting from increases in the share price, which is required upon change in employment status, is excluded from Adjusted Pro Forma results.

Special Charges. Expenses during 2015 primarily related to a charge for the impairment of goodwill in the Institutional Asset Management reporting unit and charges related to the restructuring of our investment in Atalanta Sosnoff during the fourth quarter, primarily related to the conversion of certain of Atalanta Sosnoff’s profits interests held by management to equity interests. Special Charges for 2015 also include separation benefits and costs associated with the termination of certain contracts within the Company’s Evercore ISI business, as well as the finalization of a matter associated with the wind-down of the Company’s U.S. Private Equity business. Expenses during 2014 primarily related to separation benefits and certain exit costs related to combining the equities business upon the ISI acquisition during 2014 and a provision recorded in 2014 against contingent consideration due on the 2013 disposition of Pan.

Income Taxes. Evercore is organized as a series of Limited Liability Companies, Partnerships, a C-Corporation and a Public Corporation and therefore, not all of the Company’s income is subject to corporate-level taxes. As a result, adjustments have been made to the Adjusted Pro Forma earnings to assume that the Company has adopted a conventional corporate tax structure and is taxed as a C-Corporation in the U.S. at the prevailing corporate rates, that all deferred tax assets relating to foreign operations are fully realizable within the structure on a consolidated basis and that adjustments for deferred tax assets related to the ultimate tax deductions for equity-based compensation awards are made directly to stockholders’ equity. This assumption is consistent with the assumption that certain Evercore LP Units and interests are vested and exchanged into Class A shares, as discussed in Item 1 above, as the assumed exchange would change the tax structure of the Company. In addition, the Adjusted Pro Forma presentation reflects the netting of changes in the Company’s Tax Receivable Agreement against Income Tax Expense.

Presentation of Interest Expense. The Adjusted Pro Forma results present interest expense on short-term repurchase agreements, within the Investment Management segment, in Other Revenues, net, as the Company’s Management believes it is more meaningful to present the spread on net interest resulting from the matched financial assets and liabilities. In addition, Adjusted Pro Forma Investment Banking and Investment Management Operating Income is presented before interest expense on debt, which is included in interest expense on a U.S. GAAP basis.

Presentation of Income from Equity Method Investments. The Adjusted Pro Forma results present Income from Equity Method Investments within Revenue as the Company’s Management believes it is a more meaningful presentation.

A-3

EVERCORE PARTNERS INC.

U.S. GAAP RECONCILIATION TO ADJUSTED PRO FORMA

(dollars in thousands)

(UNAUDITED)


	Three Months Ended									Twelve Months Ended
	December 31, 2015			September 30, 2015			December 31, 2014			December 31, 2015			December 31, 2014
Net Revenues - U.S. GAAP	$	408,243		$	308,951		$	321,888		$	1,223,273		$	915,858
Client Related Expenses (1)		(7,984	)		(6,661	)		(5,135	)		(22,625	)		(17,753	)
Income from Equity Method Investments (2)		2,016			929			1,799			6,050			5,180
Interest Expense on Debt (3)		1,854			2,414			2,166			9,617			8,430
Other Purchase Accounting-related Amortization (7a)		—			—			211			106			211

Net Revenues - Adjusted Pro Forma	$	404,129		$	305,633		$	320,929		$	1,216,421		$	911,926

Compensation Expense - U.S. GAAP	$	254,530		$	197,375		$	192,217		$	788,175		$	549,516
Amortization of LP Units / Interests and Certain Other Awards (4)		(17,550	)		(21,980	)		(3,399	)		(83,673	)		(3,399	)
Other Acquisition Related Compensation Charges (5)		—			—			(1,568	)		(1,537	)		(7,939	)

Compensation Expense - Adjusted Pro Forma	$	236,980		$	175,395		$	187,250		$	702,965		$	538,178

Operating Income - U.S. GAAP	$	74,663		$	11,898		$	67,852		$	128,670		$	170,947
Income from Equity Method Investments (2)		2,016			929			1,799			6,050			5,180

Pre-Tax Income - U.S. GAAP		76,679			12,827			69,651			134,720			176,127
Amortization of LP Units / Interests and Certain Other Awards (4)		17,550			21,980			3,399			83,673			3,399
Other Acquisition Related Compensation Charges (5)		—			—			1,568			1,537			7,939
Special Charges (6)		7,645			28,000			1,161			41,144			4,893
Intangible Asset Amortization / Other Purchase Accounting-related Amortization (7a)		3,245			4,898			2,405			14,229			3,033
Acquisition and Transition Costs (7b)		2,951			538			590			4,890			4,712
Professional Fees (7c)		—			—			—			—			1,672
Fair Value of Contingent Consideration (7d)		(93	)		2,797			—			2,704			—

Pre-Tax Income - Adjusted Pro Forma		107,977			71,040			78,774			282,897			201,775
Interest Expense on Debt (3)		1,854			2,414			2,166			9,617			8,430

Operating Income - Adjusted Pro Forma	$	109,831		$	73,454		$	80,940		$	292,514		$	210,205

Provision for Income Taxes - U.S. GAAP	$	46,703		$	7,392		$	30,542		$	77,030		$	68,756
Income Taxes (8)		(6,265	)		19,106			52			28,604			7,593

Provision for Income Taxes - Adjusted Pro Forma	$	40,438		$	26,498		$	30,594		$	105,634		$	76,349

Net Income Attributable to Evercore Partners Inc. - U.S. GAAP	$	20,602		$	7,197		$	27,732		$	42,863		$	86,874
Amortization of LP Units / Interests and Certain Other Awards (4)		17,550			21,980			3,399			83,673			3,399
Other Acquisition Related Compensation Charges (5)		—			—			1,568			1,537			7,939
Special Charges (6)		7,645			28,000			1,161			41,144			4,893
Intangible Asset Amortization / Other Purchase Accounting-related Amortization (7a)		3,245			4,898			2,405			14,229			3,033
Acquisition and Transition Costs (7b)		2,951			538			590			4,890			4,712
Professional Fees (7c)		—			—			—			—			1,672
Fair Value of Contingent Consideration (7d)		(93	)		2,797			—			2,704			—
Income Taxes (8)		6,265			(19,106	)		(52	)		(28,604	)		(7,593	)
Noncontrolling Interest (9)		6,552			(3,370	)		9,097			8,871			19,350

Net Income Attributable to Evercore Partners Inc. - Adjusted Pro Forma	$	64,717		$	42,934		$	45,900		$	171,307		$	124,279

Diluted Shares Outstanding - U.S. GAAP		45,480			44,334			41,912			43,699			41,843
LP Units (10a)		7,501			8,749			9,211			9,261			5,929
Unvested Restricted Stock Units - Event Based (10a)		12			12			12			12			12
Acquisition Related Share Issuance (10b)		—			—			136			51			233

Diluted Shares Outstanding - Adjusted Pro Forma		52,993			53,095			51,271			53,023			48,017

Key Metrics: (a)
Diluted Earnings Per Share - U.S. GAAP	$	0.45		$	0.16		$	0.66		$	0.98		$	2.08
Diluted Earnings Per Share - Adjusted Pro Forma	$	1.22		$	0.81		$	0.90		$	3.23		$	2.59

Compensation Ratio - U.S. GAAP		62.3	%		63.9	%		59.7	%		64.4	%		60.0	%
Compensation Ratio - Adjusted Pro Forma		58.6	%		57.4	%		58.3	%		57.8	%		59.0	%

Operating Margin - U.S. GAAP		18.3	%		3.9	%		21.1	%		10.5	%		18.7	%
Operating Margin - Adjusted Pro Forma		27.2	%		24.0	%		25.2	%		24.0	%		23.1	%

Effective Tax Rate - U.S. GAAP		60.9	%		57.6	%		43.9	%		57.2	%		39.0	%
Effective Tax Rate - Adjusted Pro Forma		37.5	%		37.3	%		38.8	%		37.3	%		37.8	%

(a)	Reconciliations of the key metrics from U.S. GAAP to Adjusted Pro Forma are a derivative of the reconciliations of their components above.

A-4

EVERCORE PARTNERS INC.

U.S. GAAP RECONCILIATION TO ADJUSTED PRO FORMA

TRAILING TWELVE MONTHS

(dollars in thousands)

(UNAUDITED)


	Consolidated
	Twelve Months Ended
	December 31, 2015			September 30, 2015			December 31, 2014
Net Revenues - U.S. GAAP	$	1,223,273		$	1,136,918		$	915,858
Client Related Expenses (1)		(22,625	)		(19,776	)		(17,753	)
Income from Equity Method Investments (2)		6,050			5,833			5,180
Interest Expense on Debt (3)		9,617			9,929			8,430
Other Purchase Accounting-related Amortization (7a)		106			317			211

Net Revenues - Adjusted Pro Forma	$	1,216,421		$	1,133,221		$	911,926

Compensation Expense - U.S. GAAP	$	788,175		$	725,862		$	549,516
Amortization of LP Units / Interests and Certain Other Awards (4)		(83,673	)		(69,522	)		(3,399	)
Other Acquisition Related Compensation Charges (5)		(1,537	)		(3,105	)		(7,939	)

Compensation Expense - Adjusted Pro Forma	$	702,965		$	653,235		$	538,178

Compensation Ratio - U.S. GAAP (a)		64.4	%		63.8	%		60.0	%
Compensation Ratio - Adjusted Pro Forma (a)		57.8	%		57.6	%		59.0	%

	Investment Banking
	Twelve Months Ended
	December 31, 2015			September 30, 2015			December 31, 2014
Net Revenues - U.S. GAAP	$	1,130,915		$	1,044,310		$	819,637
Client Related Expenses (1)		(22,551	)		(19,675	)		(17,702	)
Income from Equity Method Investments (2)		978			278			495
Interest Expense on Debt (3)		6,041			6,105			4,640
Other Purchase Accounting-related Amortization (7a)		106			317			211

Net Revenues - Adjusted Pro Forma	$	1,115,489		$	1,031,335		$	807,281

Compensation Expense - U.S. GAAP	$	734,078		$	669,895		$	492,649
Amortization of LP Units / Interests and Certain Other Awards (4)		(83,673	)		(69,522	)		(3,399	)
Other Acquisition Related Compensation Charges (5)		(1,537	)		(3,105	)		(7,939	)

Compensation Expense - Adjusted Pro Forma	$	648,868		$	597,268		$	481,311

Compensation Ratio - U.S. GAAP (a)		64.9	%		64.1	%		60.1	%
Compensation Ratio - Adjusted Pro Forma (a)		58.2	%		57.9	%		59.6	%

(a)	Reconciliations of the key metrics from U.S. GAAP to Adjusted Pro Forma are a derivative of the reconciliations of their components above.

A-5

EVERCORE PARTNERS INC.

U.S. GAAP SEGMENT RECONCILIATION TO ADJUSTED PRO FORMA

FOR THE THREE AND TWELVE MONTHS ENDED DECEMBER 31, 2015

(dollars in thousands)

(UNAUDITED)


	Investment Banking Segment
	Three Months Ended December 31, 2015									Twelve Months Ended December 31, 2015
	U.S. GAAP Basis			Adjustments			Non-GAAP Adjusted Pro Forma Basis			U.S. GAAP Basis			Adjustments			Non-GAAP Adjusted Pro Forma Basis
Net Revenues:
Investment Banking Revenue	$	384,111		$	(7,239	)(1)(2)	$	376,872		$	1,133,860		$	(21,573	)(1)(2)	$	1,112,287
Other Revenue, net		(71	)		1,152	(3)		1,081			(2,945	)		6,147	(3)(7a)		3,202

Net Revenues		384,040			(6,087	)		377,953			1,130,915			(15,426	)		1,115,489

Expenses:
Employee Compensation and Benefits		241,389			(17,550	)(4)		223,839			734,078			(85,210	)(4)(5)		648,868
Non-compensation Costs		65,283			(14,000	)(7)		51,283			241,811			(43,929	)(7)		197,882
Special Charges		—			—			—			2,151			(2,151	)(6)		—

Total Expenses		306,672			(31,550	)		275,122			978,040			(131,290	)		846,750

Operating Income (a)	$	77,368		$	25,463		$	102,831		$	152,875		$	115,864		$	268,739

Compensation Ratio (b)		62.9	%					59.2	%		64.9	%					58.2	%
Operating Margin (b)		20.1	%					27.2	%		13.5	%					24.1	%

	Investment Management Segment
	Three Months Ended December 31, 2015									Twelve Months Ended December 31, 2015
	U.S. GAAP Basis			Adjustments			Non-GAAP Adjusted Pro Forma Basis			U.S. GAAP Basis			Adjustments			Non-GAAP Adjusted Pro Forma Basis
Net Revenues:
Investment Management Revenue	$	24,731		$	1,271	(1)(2)	$	26,002		$	95,129		$	4,998	(1)(2)	$	100,127
Other Revenue, net		(528	)		702	(3)		174			(2,771	)		3,576	(3)		805

Net Revenues		24,203			1,973			26,176			92,358			8,574			100,932

Expenses:
Employee Compensation and Benefits		13,141			—			13,141			54,097			—			54,097
Non-compensation Costs		6,122			(87	)(7)		6,035			23,473			(413	)(7)		23,060
Special Charges		7,645			(7,645	)(6)		—			38,993			(38,993	)(6)		—

Total Expenses		26,908			(7,732	)		19,176			116,563			(39,406	)		77,157

Operating Income (Loss) (a)	$	(2,705	)	$	9,705		$	7,000		$	(24,205	)	$	47,980		$	23,775

Compensation Ratio (b)		54.3	%					50.2	%		58.6	%					53.6	%
Operating Margin (b)		(11.2	%)					26.7	%		(26.2	%)					23.6	%

(a)	Operating Income (Loss) for U.S. GAAP excludes Income (Loss) from Equity Method Investments.

(b)	Reconciliations of the key metrics from U.S. GAAP to Adjusted Pro Forma are a derivative of the reconciliations of their components above.

A-6

EVERCORE PARTNERS INC.

U.S. GAAP SEGMENT RECONCILIATION TO ADJUSTED PRO FORMA

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2015

(dollars in thousands)

(UNAUDITED)


	Investment Banking Segment
	Three Months Ended September 30, 2015
	U.S. GAAP Basis			Adjustments			Non-GAAP Adjusted Pro Forma Basis
Net Revenues:
Investment Banking Revenue	$	285,561		$	(7,125	)(1)(2)	$	278,436
Other Revenue, net		357			1,452	(3)		1,809

Net Revenues		285,918			(5,673	)		280,245

Expenses:
Employee Compensation and Benefits		184,372			(21,980	)(4)		162,392
Non-compensation Costs		66,324			(14,748	)(7)		51,576

Total Expenses		250,696			(36,728	)		213,968

Operating Income (a)	$	35,222		$	31,055		$	66,277

Compensation Ratio (b)		64.5	%					57.9	%
Operating Margin (b)		12.3	%					23.6	%

	Investment Management Segment
	Three Months Ended September 30, 2015
	U.S. GAAP Basis			Adjustments			Non-GAAP Adjusted Pro Forma Basis
Net Revenues:
Investment Management Revenue	$	23,812		$	1,393	(1)(2)	$	25,205
Other Revenue, net		(779	)		962	(3)		183

Net Revenues		23,033			2,355			25,388

Expenses:
Employee Compensation and Benefits		13,003			—			13,003
Non-compensation Costs		5,354			(146	)(7)		5,208
Special Charges		28,000			(28,000	)(6)		—

Total Expenses		46,357			(28,146	)		18,211

Operating Income (Loss) (a)	$	(23,324	)	$	30,501		$	7,177

Compensation Ratio (b)		56.5	%					51.2	%
Operating Margin (b)		(101.3	%)					28.3	%

(a)	Operating Income (Loss) for U.S. GAAP excludes Income (Loss) from Equity Method Investments.

(b)	Reconciliations of the key metrics from U.S. GAAP to Adjusted Pro Forma are a derivative of the reconciliations of their components above.

A-7

EVERCORE PARTNERS INC.

U.S. GAAP SEGMENT RECONCILIATION TO ADJUSTED PRO FORMA

FOR THE THREE AND TWELVE MONTHS ENDED DECEMBER 31, 2014

(dollars in thousands)

(UNAUDITED)


	Investment Banking Segment
	Three Months Ended December 31, 2014									Twelve Months Ended December 31, 2014
	U.S. GAAP Basis			Adjustments			Non-GAAP Adjusted Pro Forma Basis			U.S. GAAP Basis			Adjustments			Non-GAAP Adjusted Pro Forma Basis
Net Revenues:
Investment Banking Revenue	$	298,426		$	(5,063	)(1)(2)	$	293,363		$	821,359		$	(17,207	)(1)(2)	$	804,152
Other Revenue, net		(991	)		1,427	(3)(7a)		436			(1,722	)		4,851	(3)(7a)		3,129

Net Revenues		297,435			(3,636	)		293,799			819,637			(12,356	)		807,281

Expenses:
Employee Compensation and Benefits		177,206			(4,967	)(4)(5)		172,239			492,649			(11,338	)(4)(5)		481,311
Non-compensation Costs		52,558			(7,805	)(7)		44,753			160,494			(26,580	)(7)		133,914
Special Charges		1,161			(1,161	)(6)		—			4,893			(4,893	)(6)		—

Total Expenses		230,925			(13,933	)		216,992			658,036			(42,811	)		615,225

Operating Income (a)	$	66,510		$	10,297		$	76,807		$	161,601		$	30,455		$	192,056

Compensation Ratio (b)		59.6	%					58.6	%		60.1	%					59.6	%
Operating Margin (b)		22.4	%					26.1	%		19.7	%					23.8	%

	Investment Management Segment
	Three Months Ended December 31, 2014									Twelve Months Ended December 31, 2014
	U.S. GAAP Basis			Adjustments			Non-GAAP Adjusted Pro Forma Basis			U.S. GAAP Basis			Adjustments			Non-GAAP Adjusted Pro Forma Basis
Net Revenues:
Investment Management Revenue	$	25,258		$	1,727	(1)(2)	$	26,985		$	98,751		$	4,634	(1)(2)	$	103,385
Other Revenue, net		(805	)		950	(3)		145			(2,530	)		3,790	(3)		1,260

Net Revenues		24,453			2,677			27,130			96,221			8,424			104,645

Expenses:
Employee Compensation and Benefits		15,011			—			15,011			56,867			—			56,867
Non-compensation Costs		8,100			(114	)(7)		7,986			30,008			(379	)(7)		29,629

Total Expenses		23,111			(114	)		22,997			86,875			(379	)		86,496

Operating Income (a)	$	1,342		$	2,791		$	4,133		$	9,346		$	8,803		$	18,149

Compensation Ratio (b)		61.4	%					55.3	%		59.1	%					54.3	%
Operating Margin (b)		5.5	%					15.2	%		9.7	%					17.3	%

(a)	Operating Income for U.S. GAAP excludes Income (Loss) from Equity Method Investments.

(b)	Reconciliations of the key metrics from U.S. GAAP to Adjusted Pro Forma are a derivative of the reconciliations of their components above.

A-8

Notes to Unaudited Condensed Consolidated Adjusted Pro Forma Financial Data

For further information on these Adjusted Pro Forma adjustments, see page A-2.

(1)	Client related expenses and provisions for uncollected receivables have been reclassified as a reduction of revenue in the Adjusted Pro Forma presentation.

(2)	Income (Loss) from Equity Method Investments has been reclassified to Revenue in the Adjusted Pro Forma presentation.

(3)	Interest Expense on Debt is excluded from the Adjusted Pro Forma Investment Banking and Investment Management segment results and is included in Interest Expense in the segment results on a U.S. GAAP Basis.

(4)	Expenses incurred from the assumed vesting of Class E LP Units and Class G and H LP Interests issued in conjunction with the acquisition of ISI are excluded from the Adjusted Pro Forma presentation.

(5)	Expenses for deferred consideration issued to the sellers of certain of the Company’s acquisitions are excluded from the Adjusted Pro Forma presentation.

(6)

Expenses during 2015 primarily related to a $28.5 million charge for the impairment of goodwill in the Institutional Asset Management reporting unit and charges of $7.1 million related to the restructuring of our investment in Atalanta Sosnoff during the fourth quarter, primarily related to the conversion of certain of Atalanta Sosnoff’s profits interests held by management to equity interests. Expenses during 2015 also include charges of $2.2 million related to separation benefits and costs associated with the termination of certain contracts within the Company’s Evercore ISI business, as well as $3.3 million related to the finalization of a matter associated with the wind-down of the Company’s U.S. Private Equity business. Expenses during 2014 primarily related to separation benefits and certain exit costs related to combining the equities business upon the ISI acquisition during 2014 and a provision recorded in 2014 against contingent consideration due on the 2013 disposition of Pan.

A-9

(7)	Non-compensation Costs on an Adjusted Pro Forma basis reflect the following adjustments:


	Three Months Ended December 31, 2015
	U.S. GAAP		Adjustments			Total Segments		Investment Banking		Investment Management
Occupancy and Equipment Rental	$	12,072	$	—		$	12,072	$	10,427	$	1,645
Professional Fees		14,810		(3,523	)(1)		11,287		9,576		1,711
Travel and Related Expenses		16,251		(4,211	)(1)		12,040		11,459		581
Communications and Information Services		8,777		(25	)(1)		8,752		8,171		581
Depreciation and Amortization		6,815		(3,245	)(7a)		3,570		2,786		784
Acquisition and Transition Costs		2,951		(2,951	)(7b)		—		—		—
Other Operating Expenses		9,729		(132	)(1)(7d)		9,597		8,864		733

Total Non-compensation Costs	$	71,405	$	(14,087	)	$	57,318	$	51,283	$	6,035


	Three Months Ended September 30, 2015
	U.S. GAAP		Adjustments			Total Segments		Investment Banking		Investment Management
Occupancy and Equipment Rental	$	11,717	$	—		$	11,717	$	10,675	$	1,042
Professional Fees		13,410		(1,823	)(1)		11,587		9,939		1,648
Travel and Related Expenses		12,567		(3,631	)(1)		8,936		8,454		482
Communications and Information Services		9,295		(11	)(1)		9,284		8,825		459
Depreciation and Amortization		8,398		(4,898	)(7a)		3,500		2,463		1,037
Acquisition and Transition Costs		538		(538	)(7b)		—		—		—
Other Operating Expenses		15,753		(3,993	)(1)(7d)		11,760		11,220		540

Total Non-compensation Costs	$	71,678	$	(14,894	)	$	56,784	$	51,576	$	5,208


	Three Months Ended December 31, 2014
	U.S. GAAP		Adjustments			Total Segments		Investment Banking		Investment Management
Occupancy and Equipment Rental	$	11,581	$	—		$	11,581	$	9,845	$	1,736
Professional Fees		14,068		(2,324	)(1)		11,744		8,773		2,971
Travel and Related Expenses		12,957		(2,744	)(1)		10,213		9,618		595
Communications and Information Services		7,549		—	(1)		7,549		6,902		647
Depreciation and Amortization		5,397		(2,194	)(7a)		3,203		2,230		973
Acquisition and Transition Costs		590		(590	)(7b)		—		—		—
Other Operating Expenses		8,516		(67	)(1)		8,449		7,385		1,064

Total Non-compensation Costs	$	60,658	$	(7,919	)	$	52,739	$	44,753	$	7,986


	Twelve Months Ended December 31, 2015
	U.S. GAAP		Adjustments			Total Segments		Investment Banking		Investment Management
Occupancy and Equipment Rental	$	47,703	$	—		$	47,703	$	42,005	$	5,698
Professional Fees		50,817		(7,929	)(1)		42,888		36,343		6,545
Travel and Related Expenses		55,388		(13,030	)(1)		42,358		40,163		2,195
Communications and Information Services		36,372		(60	)(1)		36,312		34,086		2,226
Depreciation and Amortization		27,927		(14,123	)(7a)		13,804		10,081		3,723
Acquisition and Transition Costs		4,890		(4,890	)(7b)		—		—		—
Other Operating Expenses		42,187		(4,310	)(1)(7d)		37,877		35,204		2,673

Total Non-compensation Costs	$	265,284	$	(44,342	)	$	220,942	$	197,882	$	23,060


	Twelve Months Ended December 31, 2014
	U.S. GAAP		Adjustments			Total Segments		Investment Banking		Investment Management
Occupancy and Equipment Rental	$	41,202	$	—		$	41,202	$	34,424	$	6,778
Professional Fees		45,429		(8,325	)(1)(7c)		37,104		27,577		9,527
Travel and Related Expenses		40,015		(9,808	)(1)		30,207		27,759		2,448
Communications and Information Services		18,818		(13	)(1)		18,805		16,700		2,105
Depreciation and Amortization		16,263		(2,822	)(7a)		13,441		7,909		5,532
Acquisition and Transition Costs		5,828		(4,712	)(7b)		1,116		1,116		—
Other Operating Expenses		22,947		(1,279	)(1)		21,668		18,429		3,239

Total Non-compensation Costs	$	190,502	$	(26,959	)	$	163,543	$	133,914	$	29,629

(7a)	The exclusion from the Adjusted Pro Forma presentation of expenses associated with amortization of intangible assets and other purchase accounting-related amortization from the acquisitions of ISI, SFS and certain other acquisitions.

A-10

(7b)	Primarily professional fees incurred and costs related to transitioning ISI’s infrastructure, including certain regulatory settlements.

(7c)	The expense associated with share-based awards resulting from increases in the share price, which is required upon change in employment status, is excluded from Adjusted Pro Forma results.

(7d)	The expense associated with changes in the fair value of contingent consideration issued to the sellers of certain of the Company’s acquisitions is excluded from Adjusted Pro Forma results.

(8)

Evercore is organized as a series of Limited Liability Companies, Partnerships, a C-Corporation and a Public Corporation and therefore, not all of the Company’s income is subject to corporate level taxes. As a result, adjustments have been made to Evercore’s effective tax rate assuming that the Company has adopted a conventional corporate tax structure and is taxed as a C-Corporation in the U.S. at the prevailing corporate rates, that all deferred tax assets relating to foreign operations are fully realizable within the structure on a consolidated basis and that, historically, adjustments for deferred tax assets related to the ultimate tax deductions for equity-based compensation awards are made directly to stockholders’ equity. In addition, the Adjusted Pro Forma presentation reflects the netting of changes in the Company’s Tax Receivable Agreement against Income Tax Expense.

(9)	Reflects adjustment to eliminate noncontrolling interest related to all Evercore LP partnership units which are assumed to be converted to Class A common stock in the Adjusted Pro Forma presentation.

(10a)

Assumes the vesting, and exchange into Class A shares, of certain Evercore LP partnership units and interests and IPO related restricted stock unit awards in the Adjusted Pro Forma presentation. In the computation of outstanding common stock equivalents for U.S. GAAP net income per share, the Evercore LP partnership units are anti-dilutive.

(10b)

Assumes the vesting of all Acquisition Related Share Issuances and Unvested Restricted Stock Units granted to Lexicon employees in the Adjusted Pro Forma presentation. In the computation of outstanding common stock equivalents for U.S. GAAP, these Shares and Restricted Stock Units are reflected using the Treasury Stock Method.

A-11

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