Cover Page
Cover Page - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Feb. 22, 2021 | Jun. 30, 2020 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2020 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-32147 | ||
Entity Registrant Name | GREENHILL & CO INC | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 51-0500737 | ||
Entity Address, Address Line One | 1271 Avenue of the Americas | ||
Entity Address, City or Town | New York | ||
Entity Address, State or Province | NY | ||
Entity Address, Postal Zip Code | 10020 | ||
City Area Code | 212 | ||
Local Phone Number | 389-1500 | ||
Title of 12(b) Security | Common Stock, par value $.01 per share | ||
Trading Symbol | GHL | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 141 | ||
Entity Common Stock, Shares Outstanding | 19,511,810 | ||
Documents Incorporated by Reference | Portions of the Registrant’s definitive proxy statement to be delivered to stockholders in connection with the 2021 annual meeting of stockholders to be held on April 27, 2021 are incorporated by reference in response to Part III of this Report. | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Entity Central Index Key | 0001282977 |
Consolidated Statements of Fina
Consolidated Statements of Financial Condition - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Assets | ||
Cash and cash equivalents ($7.2 million and $9.8 million restricted from use at December 31, 2020 and 2019, respectively) | $ 112,703 | $ 113,975 |
Fees receivable, net of allowance for doubtful accounts of $0.5 million and $1.1 million at December 31, 2020 and 2019, respectively | 80,919 | 77,766 |
Other receivables | 5,285 | 2,519 |
Property and equipment, net of accumulated depreciation of $17.5 million and $47.7 million at December 31, 2020 and 2019, respectively | 21,242 | 6,281 |
Operating lease right-of-use asset | 76,440 | 28,346 |
Goodwill | 215,936 | 205,992 |
Deferred tax asset, net | 65,033 | 51,278 |
Other assets | 8,241 | 8,218 |
Total assets | 585,799 | 494,375 |
Liabilities and Equity | ||
Compensation payable | 34,061 | 26,878 |
Accounts payable and accrued expenses | 15,424 | 12,412 |
Current income taxes payable | 6,031 | 9,653 |
Operating lease obligations | 95,097 | 30,750 |
Secured term loan payable | 321,046 | 358,003 |
Deferred tax liability | 26,073 | 12,004 |
Total liabilities | 497,732 | 449,700 |
Common stock, par value $0.01 per share; 100,000,000 shares authorized, 48,701,743 and 46,801,812 shares issued as of December 31, 2020 and 2019, respectively; 19,001,605 and 18,355,907 shares outstanding as of December 31, 2020 and 2019, respectively | 487 | 468 |
Restricted stock units | 59,412 | 77,657 |
Additional paid-in capital | 937,025 | 887,095 |
Retained earnings | 95,424 | 69,093 |
Accumulated other comprehensive income (loss) | (25,501) | (34,115) |
Treasury stock, at cost, par value $0.01 per share; 29,700,138 and 28,445,905 shares as of December 31, 2020 and 2019, respectively | (978,780) | (955,523) |
Stockholders’ equity | 88,067 | 44,675 |
Total liabilities and equity | $ 585,799 | $ 494,375 |
Consolidated Statements of Fi_2
Consolidated Statements of Financial Condition (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Cash and cash equivalents, restricted from use | $ 7,170 | $ 9,769 |
Fees receivable, allowance for doubtful accounts | 500 | 1,100 |
Property and equipment, accumulated depreciation | $ 17,454 | $ 47,735 |
Common stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (shares) | 48,701,743 | 46,801,812 |
Common stock, shares outstanding (shares) | 19,001,605 | 18,355,907 |
Treasury stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Treasury stock, shares (shares) | 29,700,138 | 28,445,905 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Revenues | |||
Revenues | $ 311,678 | $ 301,012 | $ 351,985 |
Operating Expenses | |||
Employee compensation and benefits | 194,084 | 178,946 | 195,195 |
Occupancy and equipment rental | 25,175 | 22,289 | 21,933 |
Depreciation and amortization | 2,168 | 2,565 | 2,870 |
Information services | 10,083 | 9,940 | 9,898 |
Professional fees | 9,618 | 10,017 | 10,465 |
Travel related expenses | 2,848 | 13,523 | 13,483 |
Other operating expenses | 12,454 | 17,889 | 17,273 |
Total operating expenses | 256,430 | 255,169 | 271,117 |
Total operating income | 55,248 | 45,843 | 80,868 |
Interest expense | 15,487 | 27,420 | 22,438 |
Income before taxes | 39,761 | 18,423 | 58,430 |
Provision for taxes | 8,427 | 7,445 | 19,208 |
Net income | $ 31,334 | $ 10,978 | $ 39,222 |
Average shares outstanding: | |||
Basic (in shares) | 18,939,210 | 24,024,674 | 26,813,285 |
Diluted (in shares) | 23,078,451 | 24,272,479 | 27,637,720 |
Earnings per share: | |||
Basic (in usd per share) | $ 1.65 | $ 0.46 | $ 1.46 |
Diluted (in usd per share) | $ 1.36 | $ 0.45 | $ 1.42 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Statement of Comprehensive Income [Abstract] | |||
Consolidated net income | $ 31,334 | $ 10,978 | $ 39,222 |
Currency translation adjustment, net of tax | 8,614 | 1,590 | (13,483) |
Comprehensive income | $ 39,948 | $ 12,568 | $ 25,739 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands | Total | Restricted stock units | Common stock | Restricted stock unitsRestricted stock units | Additional paid-in capital | Exchangeable shares of subsidiary | Retained earnings | Retained earningsCumulative effect of the change in accounting principle | Retained earningsRetained earnings, beginning of the period, as adjusted | Accumulated other comprehensive income (loss) | Treasury stock | Parent |
Beginning Balance at Dec. 31, 2017 | $ 438 | $ 80,512 | $ 800,806 | $ 1,958 | $ 37,595 | $ (7,645) | $ 29,950 | $ (22,222) | $ (690,785) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Common stock issued | 12 | 45,915 | ||||||||||
Restricted stock units recognized, net of forfeitures | 37,941 | |||||||||||
Restricted stock units delivered | (46,857) | |||||||||||
Tax effect of issuance of contingent equity earnout | 0 | |||||||||||
Exchangeable shares of subsidiary delivered | 0 | |||||||||||
Accounting Standards Update [Extensible List] | us-gaap:AccountingStandardsUpdate201409Member | |||||||||||
Dividends | (5,745) | |||||||||||
Net income | $ 39,222 | 39,222 | ||||||||||
Currency translation adjustment, net of tax | (13,483) | (13,483) | ||||||||||
Repurchased | (195,299) | |||||||||||
Ending Balance at Dec. 31, 2018 | 450 | 71,596 | 846,721 | 1,958 | 63,427 | 63,427 | (35,705) | (886,084) | $ 62,363 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Common stock issued | 18 | 41,582 | ||||||||||
Restricted stock units recognized, net of forfeitures | 46,382 | |||||||||||
Restricted stock units delivered | (40,321) | |||||||||||
Tax effect of issuance of contingent equity earnout | (1,208) | |||||||||||
Exchangeable shares of subsidiary delivered | (1,958) | |||||||||||
Dividends | (5,312) | |||||||||||
Net income | 10,978 | 10,978 | ||||||||||
Currency translation adjustment, net of tax | 1,590 | 1,590 | ||||||||||
Repurchased | $ (14,000) | (69,439) | ||||||||||
Ending Balance at Dec. 31, 2019 | $ 44,675 | 468 | 77,657 | 887,095 | 0 | 69,093 | $ (123) | $ 68,970 | (34,115) | (955,523) | 44,675 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Common stock issued | 19 | 49,930 | ||||||||||
Restricted stock units recognized, net of forfeitures | 31,950 | |||||||||||
Restricted stock units delivered | (50,195) | |||||||||||
Tax effect of issuance of contingent equity earnout | 0 | |||||||||||
Exchangeable shares of subsidiary delivered | 0 | |||||||||||
Accounting Standards Update [Extensible List] | us-gaap:AccountingStandardsUpdate201613Member | |||||||||||
Dividends | (4,880) | |||||||||||
Net income | $ 31,334 | 31,334 | ||||||||||
Currency translation adjustment, net of tax | 8,614 | 8,614 | ||||||||||
Repurchased | $ (14,800) | (23,257) | ||||||||||
Ending Balance at Dec. 31, 2020 | $ 88,067 | $ 487 | $ 59,412 | $ 937,025 | $ 0 | $ 95,424 | $ (25,501) | $ (978,780) | $ 88,067 |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Equity (Parenthetical) - $ / shares | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Common stock, par value (usd per share) | $ 0.01 | $ 0.01 | |
Treasury stock, par value (usd per share) | 0.01 | 0.01 | |
Common stock | |||
Common stock, par value (usd per share) | 0.01 | 0.01 | $ 0.01 |
Treasury stock | |||
Treasury stock, par value (usd per share) | $ 0.01 | $ 0.01 | $ 0.01 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Operating activities: | |||
Net income | $ 31,334 | $ 10,978 | $ 39,222 |
Non-cash items included in net income: | |||
Depreciation and amortization | 3,951 | 4,487 | 5,175 |
Net investment (gains) losses | 495 | (113) | 210 |
Restricted stock units recognized, net | 31,950 | 46,382 | 37,941 |
Allowance for doubtful accounts | 263 | 1,197 | 0 |
Deferred taxes, net | (8) | (815) | 5,435 |
Loss (gain) on fair value of contingent obligation | 0 | 575 | 4,531 |
Non-cash portion of loss on refinancing | 0 | 1,759 | 0 |
Loss (gain) on sales of property and equipment | 267 | 0 | (777) |
Changes in operating assets and liabilities: | |||
Tenant incentive reimbursement from landlord | 9,663 | 0 | 0 |
Fees receivable | (3,578) | (17,170) | 2,451 |
Other receivables and assets | (2,162) | (143) | (836) |
Payment of contingent obligation due selling unitholders of Cogent | 0 | (5,724) | 0 |
Compensation payable | 6,412 | (30,939) | 30,313 |
Accounts payable and accrued expenses | 9,042 | 1,690 | (9,546) |
Current income taxes payable | (3,623) | 2,168 | 2,175 |
Net cash provided by operating activities | 84,006 | 14,332 | 116,294 |
Investing activities: | |||
Purchases of investments | (2,050) | 0 | 0 |
Proceeds from sales of investments | 847 | 0 | 0 |
Distributions from investments, net | 81 | 239 | 149 |
Purchases of property and equipment | (17,015) | (1,648) | (2,124) |
Sales of property and equipment | 0 | 0 | 1,357 |
Net cash used in investing activities | (18,137) | (1,409) | (618) |
Financing activities: | |||
Payment of contingent obligation due selling unitholders of Cogent | 0 | (13,144) | 0 |
Proceeds from secured term loan, net | 0 | 48,248 | 0 |
Repayment of secured term loan | (38,750) | (18,125) | (21,875) |
Dividends paid | (4,108) | (4,417) | (5,158) |
Purchase of treasury stock | (23,257) | (69,439) | (195,299) |
Net cash used in financing activities | (66,115) | (56,877) | (222,332) |
Effect of exchange rate changes | (1,026) | 1,555 | (4,616) |
Net decrease in cash and cash equivalents | (1,272) | (42,399) | (111,272) |
Cash and cash equivalents, beginning of year | 113,975 | 156,374 | 267,646 |
Cash and cash equivalents, end of year | 112,703 | 113,975 | 156,374 |
Supplemental disclosure of cash flow information: | |||
Cash paid for interest | 14,386 | 21,511 | 20,945 |
Cash paid for taxes, net of refunds | $ 13,515 | $ 6,201 | $ 10,299 |
Organization
Organization | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | Note 1 — Organization Greenhill & Co., Inc. and subsidiaries (the “Company” or “Greenhill”) is a leading independent investment bank that provides financial and strategic advice on significant domestic and cross-border mergers and acquisitions, restructurings, financings, capital raisings and other strategic transactions to a diverse client base, including corporations, partnerships, institutions and governments globally. The Company acts for clients located throughout the world from our global offices in the United States, Australia, Canada, France, Germany, Hong Kong, Japan, Singapore, Spain, Sweden, and the United Kingdom. The Company’s wholly-owned subsidiaries provide advisory services in various jurisdictions. Our most significant operating entities include: Greenhill & Co., LLC (“G&Co”), Greenhill & Co. International LLP (“GCI”), Greenhill & Co. Europe GmbH & Co. KG (“Greenhill Europe”) and Greenhill & Co. Australia Pty Limited (“Greenhill Australia”). G&Co is engaged in investment banking activities principally in the United States. G&Co is registered as a broker-dealer with the Securities and Exchange Commission (“SEC”) and the Financial Industry Regulatory Authority (“FINRA”), and is licensed in all 50 states and the District of Columbia. GCI is engaged in investment banking activities in the United Kingdom and Europe and is subject to regulation by the U.K. Financial Conduct Authority (“FCA”). Greenhill Europe engages in investment banking activities in Europe (other than the U.K.) and is subject to regulation by Bundesanstalt für Finanzdienstleistungsaufsicht (“Bafin”), Greenhill Australia engages in investment banking activities in Australia and New Zealand and is licensed and subject to regulation by the Australian Securities and Investment Commission (“ASIC”). The Company also operates in other locations throughout the world, which are subject to regulation by other governmental and regulatory bodies and self-regulatory authorities. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 2 — Summary of Significant Accounting Policies Basis of Financial Information These consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States (U.S. GAAP), which require management to make estimates and assumptions regarding future events that affect the amounts reported in our financial statements and these footnotes, including compensation accruals and other matters. Management believes that it has made all necessary adjustments so that the consolidated financial statements are presented fairly and that the estimates used in preparing its consolidated financial statements are reasonable and prudent. Actual results could differ materially from those estimates. Certain reclassifications have been made to prior year information to conform to current year presentation. Given the uncertainty of the COVID-19 pandemic and resulting economic impact on the Company, estimates may need to be revised in the future, which could materially impact the Company's future results of operations and/or financial condition. The consolidated financial statements of the Company include all consolidated accounts of Greenhill & Co., Inc. and all other entities in which the Company has a controlling interest after eliminations of all significant inter-company accounts and transactions. Revenue Recognition The Company recognizes revenue when (or as) services are transferred to clients. Revenue is recognized based on the amount of consideration that management expects to receive in exchange for these services in accordance with the terms of the contract with the client. To determine the amount and timing of revenue recognition, the Company must (1) identify the contract with the client, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue when (or as) the Company satisfies a performance obligation. The Company generally recognizes revenues for mergers and acquisitions engagements at the earlier of the announcement date or transaction date, as the performance obligation is typically satisfied at such time. Upfront fees and certain retainer fees are generally deferred until the announcement or transaction date, as they are considered constrained (subject to significant reversal) prior to the announcement or transaction date. Fairness opinion fees are recognized when the opinion is delivered. The Company recognizes revenues for financing advisory and restructuring engagements as the services are provided to the client, based on the terms of the engagement letter. In such arrangements, the Company’s performance obligations are to provide financial and strategic advice throughout an engagement. The Company recognizes revenues for private capital advisory fees when (1) the commitment of capital is secured (primary capital raising transactions) or the sale or transfer of the capital interest occurs (secondary market transactions) and (2) the fees are earned from the client in accordance with terms of the engagement letter. Upfront fees and certain retainer fees are deferred until the commitment is secured or the sale or transfer of the capital interest occurs, as the fees are considered constrained (subject to significant reversal) prior to such time. As a result of the deferral of certain fees, deferred revenue (also known as contract liabilities) was $7.1 million and $3.9 million as of December 31, 2020 and December 31, 2019, respectively. Deferred revenue is included in accounts payable and accrued expenses in the consolidated statements of financial condition. During the years ended December 31, 2020, 2019 and 2018, the Company recognized $2.3 million, $4.7 million and $9.3 million of revenues, respectively, that were included in the deferred revenue (contract liabilities) balance at the beginning of each respective period. The Company’s clients reimburse certain expenses incurred by the Company in the conduct of advisory engagements. Client reimbursements totaled $2.7 million, $6.4 million and $7.0 million for the years ended December 31, 2020, 2019, and 2018, respectively. Such reimbursements are reported as revenues and operating expenses with no impact to operating income. Cash and Cash Equivalents The Company’s cash and cash equivalents consist of (i) cash held on deposit with financial institutions, (ii) cash equivalents and (iii) restricted cash. The Company maintains its cash and cash equivalents with financial institutions with high credit ratings. The Company considers all highly liquid investments with an original maturity date of three months or less, when purchased, to be cash equivalents. Cash equivalents primarily consist of money market funds and other short-term highly liquid investments with original maturities of three months or less and are carried at cost, plus accrued interest, which approximates the fair value due to the short-term nature of these investments. Management believes that the Company is not exposed to significant credit risk due to the financial position of the depository institutions in which those deposits are held. See “Note 3 — Cash and Cash Equivalents”. Fees Receivable Receivables are stated net of an allowance for doubtful accounts. The estimate for the allowance for doubtful accounts is derived by the Company by utilizing past client transaction history and an assessment of the client’s creditworthiness. The Company recorded bad debt expense of $0.3 million, $1.2 million and $0.3 million for the years ended December 31, 2020, 2019 and 2018, respectively. Credit risk related to fees receivable is dispersed across a large number of clients located in various geographic areas. The Company controls credit risk through credit approvals and monitoring procedures but does not require collateral to support accounts receivable. On January 1, 2020, the Company adopted ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326) - Measurement of Credit Losses on Financial Instruments ("ASU 2016-13") under the modified retrospective approach. ASU 2016-13 replaces the incurred loss impairment methodology for financial instruments with the current expected credit loss (CECL) model which requires an estimate of future credit losses. Upon adoption, a cumulative adjustment was recorded which decreased retained earnings by $0.1 million, net of tax, as of January 1, 2020. Goodwill Goodwill is the cost in excess of the fair value of identifiable net assets at the acquisition date. The Company tests its goodwill for impairment annually or more frequently where certain events or changes in circumstances indicate that goodwill may more likely than not that impairment may have occurred. An impairment loss is triggered if the estimated fair value of an operating unit is less than the estimated net book value. Such loss is calculated as the difference between the estimated fair value of goodwill and its carrying value. See “Note 5 — Goodwill”. Goodwill is translated at the rate of exchange prevailing at the end of the periods presented in accordance with the accounting guidance for foreign currency translation. Any translation gain or loss is included in the foreign currency translation adjustment, which is included as a component of other comprehensive income (loss) in the consolidated statements of changes in stockholders’ equity. Compensation Payable Included in compensation payable are discretionary compensation awards comprised of accrued cash bonuses and long-term incentive compensation, consisting of deferred cash retention awards, which are non-interest bearing, and generally amortized ratably over a three Restricted Stock Units The Company accounts for its share-based compensation payments by recording the fair value of restricted stock units (RSUs) granted to employees as compensation expense. The restricted stock units are generally amortized ratably over a three As the Company expenses the awards, the restricted stock units recognized are recorded within stockholders’ equity. The restricted stock units are reclassified into common stock and additional paid-in capital upon vesting. The Company records as treasury stock the repurchase of stock delivered to its employees in settlement of tax liabilities incurred upon the vesting of restricted stock units. The Company records dividend equivalent payments on outstanding restricted stock units eligible for such payment as a dividend payment and a charge to stockholders’ equity. Earnings per Share The Company calculates basic earnings per share (“EPS”) by dividing net income by the weighted average number of shares outstanding for the period. The Company calculates diluted EPS by dividing net income by the sum of (i) the weighted average number of shares outstanding for the period and (ii) the dilutive effect of the common stock deliverable pursuant to restricted stock units for which future service is required as calculated using the treasury stock method. See “Note 11 — Earnings per Share”. Provision for Taxes The Company accounts for taxes in accordance with the accounting guidance for income taxes which requires the recognition of tax benefits or expenses on the temporary differences between the financial reporting and tax bases of its assets and liabilities. The Company follows the guidance for income taxes in recognizing, measuring, presenting and disclosing in its financial statements uncertain tax positions taken or expected to be taken on its income tax returns. Income tax expense is based on pre-tax accounting income, including adjustments made for the recognition or derecognition related to uncertain tax positions. The recognition or derecognition of income tax expense related to uncertain tax positions is determined under the guidance, and the Company’s policy is to treat interest and penalties related to uncertain tax positions as part of pre-tax income. Deferred tax assets and liabilities are recognized for the future tax attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in earnings in the period of change. Management applies the “more-likely-than-not criteria” when determining tax benefits. The realization of deferred tax assets arising from timing differences and net operating losses requires taxable income in future years in order to deduct the reversing timing differences and absorb the net operating losses. We assess positive and negative evidence in determining whether to record a valuation allowance with respect to deferred tax assets. This assessment is performed separately for each taxing jurisdiction. Foreign Currency Translation Assets and liabilities denominated in foreign currencies have been translated at rates of exchange prevailing at the end of the periods presented in accordance with the accounting guidance for foreign currency translation. Income and expenses transacted in foreign currency have been translated at average monthly exchange rates during the period. Translation gains and losses are included in the foreign currency translation adjustment, which is included as a component of other comprehensive income (loss) in the consolidated statements of changes in stockholders’ equity. Foreign currency transaction gains and losses are included in the consolidated statements of operations in other operating expenses. Financial Instruments and Fair Value The Company accounts for financial instruments measured at fair value in accordance with accounting guidance for fair value measurements and disclosures which establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy under the pronouncement are described below: Basis of Fair Value Measurement Level 1 – Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; Level 2 – Quoted prices in markets that are not active or financial instruments for which all significant inputs are observable, either directly or indirectly; and Level 3 – Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. In determining the appropriate levels, the Company performs an analysis of the assets and liabilities that are subject to these disclosures. At each reporting period, all assets and liabilities for which the fair value measurement is based on significant unobservable inputs or instruments which trade infrequently and therefore have little or no price transparency are classified as Level 3. Transfers between levels are recognized as of the end of the period in which they occur. See “Note 7 — Fair Value of Financial Instruments”. Leases The Company leases office space for its operations around the globe. Certain leases include options to renew, which can be exercised at the Company’s sole discretion. The Company determines if a contract contains a lease at contract inception. Operating lease assets represent the Company’s right to use the underlying asset and operating lease liabilities represent the Company’s obligation to make lease payments. Operating lease assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. When determining the lease term, the Company generally does not include options to renew as it is not reasonably certain at contract inception that the Company will exercise the option(s). The Company uses the implicit rate when readily determinable and its incremental borrowing rate when the implicit rate is not readily determinable. The Company’s incremental borrowing rate is determined using its secured borrowing rate and giving consideration to the currency and term of the associated lease as appropriate. The lease payments used to determine the Company’s operating lease assets may include lease incentives, stated rent increases and escalation clauses linked to rates of inflation when determinable and are recognized in operating lease assets in the consolidated statement of financial condition. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. The straight-lining of rent expense results in differences in the operating lease right-of-use asset and operating lease obligations on the consolidated statement of financial condition. Temporary differences are recognized for tax purposes and reflected separately in the consolidated statement of financial condition as deferred lease assets and lease liabilities within deferred tax assets and deferred tax liabilities. Property and Equipment Property and equipment is stated at cost less accumulated depreciation and amortization. Depreciation is computed using the straight-line method over the life of the assets. Amortization of leasehold improvements is computed using the straight-line method over the lesser of the life of the asset or the remaining term of the lease. Estimated useful lives of the Company’s fixed assets are generally as follows: Equipment – 5 years Furniture and fixtures – 7 years Leasehold improvements – the lesser of 15 years or the remaining lease term Business Information The Company’s activities as an investment banking firm constitute a single business segment, with substantially all revenues generated from advisory services, which includes engagements relating to mergers and acquisitions, financing advisory and restructuring, and private capital advisory services. Recently Adopted Accounting Pronouncements In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326) - Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). This ASU changes how companies measure credit losses on most financial instruments, including accounts receivable. Companies will be required to estimate lifetime expected credit losses, which is generally expected to result in earlier recognition of credit losses. The Company adopted this standard effective on January 1, 2020 under a modified retrospective approach. The cumulative effect of adopting this ASU was a net decrease to retained earnings of $0.1 million. In February 2016, the FASB issued ASU No. 2016-02, Leases (“ASU 2016-02”), which requires the recognition of lease assets and lease liabilities for operating leases, among other changes. The Company adopted this standard on January 1, 2019 utilizing a modified retrospective approach. The Company elected to apply practical expedients provided in the standard that allowed the Company to not reassess whether expired or existing contracts are or contain leases, not reassess lease classification for expired or existing leases (e.g., pre-existing operating leases are classified as operating leases under the new standard), and not reassess initial direct costs for existing leases. The impact of adopting ASU 2016-02 was an increase of $38.1 million to the Company’s assets and liabilities for the operating lease right-of-use assets and operating lease obligations on the consolidated statement of financial condition as of January 1, 2019. Upon adoption, the Company also reclassified $3.2 million of deferred rent from accounts payable and accrued expenses to operating lease obligations on the condensed consolidated statement of financial condition. Differences in the operating lease right-of-use asset and operating lease obligations are due to straight-lining rent expense and the resulting deferred rent. There was no net impact to the consolidated statement of operations. In May 2014, the FASB issued ASU 2014-09 “Revenue from Contracts with Customers” codifying ASC 606, Revenue Recognition — Revenue from Contracts with Customers, which supersedes the guidance in former ASC 605, Revenue Recognition. The Company adopted this standard on January 1, 2018 utilizing the modified retrospective approach and applied the standard to contracts that were not completed at this time. Upon adoption, certain revenues that were previously recognized as services were provided changed to either point in time recognition or over the term of an engagement. This change in the Company’s revenue recognition policy created deferred revenues (also known as contract liabilities) that will be recognized at a point in time as performance obligations are met. The cumulative effect of adopting this ASU on January 1, 2018 was a net decrease to retained earnings of $7.6 million. The Company also changed the presentation of certain reimbursed costs from a net presentation prior to adoption to a gross presentation following adoption. Accounting Developments |
Cash and Cash Equivalents
Cash and Cash Equivalents | 12 Months Ended |
Dec. 31, 2020 | |
Cash and Cash Equivalents [Abstract] | |
Cash and Cash Equivalents | Note 3 — Cash and Cash Equivalents The carrying values of the Company’s cash and cash equivalents are as follows: As of December 31, 2020 2019 (in thousands) Cash $ 52,335 $ 59,455 Cash equivalents 53,198 44,751 Restricted cash - letters of credit 7,170 9,769 Total cash and cash equivalents $ 112,703 $ 113,975 The Company's standby letter of credit of $5.9 million for its new headquarters' location may be periodically reduced under certain circumstances to approximately $3.5 million. During 2020, the standby letter of credit of $2.3 million for its former headquarters' space expired undrawn. See “Note 16 — Leases”. The carrying value of the Company’s cash equivalents approximates fair value. See “Note 7 — Fair Value of Financial Instruments”. Letters of credit were secured by cash held on deposit. See “Note 14 — Commitments and Contingencies”. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Note 4 — Property and Equipment Property and equipment consist of the following: As of December 31, 2020 2019 (in thousands) Equipment $ 11,503 $ 22,452 Furniture and fixtures 6,396 7,758 Leasehold improvements 20,797 23,806 Total property and equipment, gross 38,696 54,016 Less accumulated depreciation and amortization (17,454) (47,735) Total property and equipment, net $ 21,242 $ 6,281 |
Goodwill
Goodwill | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | Note 5 — Goodwill Goodwill consists of the following: As of December 31, 2020 2019 (in thousands) Balance, January 1 $ 205,992 $ 205,922 Foreign currency translation adjustments 9,944 70 Balance, December 31 $ 215,936 $ 205,992 |
Other Assets
Other Assets | 12 Months Ended |
Dec. 31, 2020 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Other Assets | Note 6 — Other Assets Other assets consist of the following: As of December 31, 2020 2019 (in thousands) Prepaid expenses and other assets $ 6,533 $ 6,098 Rent deposits 1,631 1,856 Other tangible assets 77 264 Total other assets $ 8,241 $ 8,218 |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Note 7 — Fair Value of Financial Instruments Assets and liabilities are classified in their entirety based on their lowest level of input that is significant to the fair value measurement. As of December 31, 2020 and 2019, the Company had Level 1 assets measured at fair value. Assets Measured at Fair Value on a Recurring Basis The following tables set forth the measurement at fair value on a recurring basis of the investments in money market funds, short-term cash instruments and U.S. government securities. The securities are categorized as a Level 1 asset, as their valuation is based on quoted prices for identical assets in active markets. See “Note 3 — Cash and Cash Equivalents”. Assets Measured at Fair Value on a Recurring Basis as of December 31, 2020 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Balance as of December 31, 2020 (in thousands) Assets Cash equivalents $ 53,198 $ — $ — $ 53,198 Total $ 53,198 $ — $ — $ 53,198 Assets Measured at Fair Value on a Recurring Basis as of December 31, 2019 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Balance as of December 31, 2019 (in thousands) Assets Cash equivalents $ 44,751 $ — $ — $ 44,751 Total $ 44,751 $ — $ — $ 44,751 Liabilities Measured at Fair Value on a Recurring Basis In connection with the acquisition in April 2015 of Cogent Partners, LP and its affiliates (“Cogent,” now known as the secondary private capital advisory business), the Company agreed to pay to the sellers in the future $18.9 million in cash and 334,048 shares of Greenhill common stock if certain agreed revenue targets are achieved (the “Earnout”). The Earnout for the period ended March 31, 2019 was achieved. The fair value of the contingent cash consideration was valued on the date of the acquisition at $13.1 million and was remeasured quarterly based on a probability weighted present value discount that the revenue target may be achieved. In April 2019, the liability was paid in full. Due to the remeasurement of the Earnout, the Company recognized increases in other operating expenses of $0.6 million and $4.5 million for the years ended December 31, 2019 and 2018, respectively. The following tables set forth the measurement at fair value on a recurring basis of the contingent cash consideration due to the selling unitholders of Cogent related to the Earnout prior to its settlement in April 2019. The liability arose as a result of the acquisition of Cogent and was categorized as a Level 3 liability. Through March 31, 2019, the liability was remeasured each quarter based on the probability of achieving the target revenue threshold and weighted average discount rate as discussed below. During 2018, the liability was transferred to Level 2 as the only remaining fair value input was the present value discount. Changes in Level 3 liabilities measured at fair value on a recurring basis for the year ended December 31, 2018 Opening Balance as of January 1, 2018 Total realized and unrealized gains (losses) included in Net Income Unrealized gains (losses) included in Other Comprehensive Income Purchases Issues Sales Transfers Out Closing Balance as of December 31, 2018 Unrealized gains (losses) for Level 3 liabilities outstanding at December 31, 2018 (in thousands) Liabilities Contingent obligation due selling unitholders of Cogent $ 13,763 $ (4,021) $ — $ — $ — $ — $ (17,784) $ — $ — Total $ 13,763 $ (4,021) $ — $ — $ — $ — $ (17,784) $ — $ — Realized and unrealized gains (losses) are reported as a component of other operating expenses in the consolidated statements of operations. There were no Level 3 liabilities at December 31, 2020 or 2019. Valuation Processes - Level 3 Measurements - The Company utilizes a valuation technique based on a present value method applied to the probability of achieving a range of potential revenue outcomes. The valuation was conducted by the Company. The Company updates unobservable inputs each reporting period and has a formal process in place to review changes in fair value. Sensitivity Analysis - Level 3 Measurements - The significant unobservable inputs used in determining fair value are the discount rate and forecast revenue information. Significant increases (decreases) in the discount rate would have resulted in a lower (higher) fair value measurement, respectively. Significant increases (decreases) in the forecast revenue information would result in a higher (lower) fair value measurement, respectively. For all significant unobservable inputs used in the fair value measurement of the Level 3 liabilities, a change in one of the inputs would not necessarily result in a directionally similar change in the other inputs. |
Related Parties
Related Parties | 12 Months Ended |
Dec. 31, 2020 | |
Related Party Transactions [Abstract] | |
Related Parties | Note 8 — Related Parties At December 31, 2020 and 2019, the Company had no amounts receivable from or payable to related parties. |
Loan Facilities
Loan Facilities | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Loan Facilities | Note 9 — Loan Facilities In October 2017, as part of a recapitalization plan, the Company entered into a credit agreement with a syndicate of lenders, who lent a face amount of $350.0 million under a five-year secured term loan facility (“2017 Term Loan Facility”). On April 12, 2019, the Company refinanced its 2017 Term Loan Facility with borrowings of $375.0 million from a new five-year secured term loan facility (“Term Loan Facility”). These borrowings were used to repay in full the $319.4 million outstanding principal balance of the 2017 Term Loan Facility, pay fees and expenses and resulted in net cash proceeds of $48.2 million, which increased the Company’s cash balance. At the time of refinancing the Company was eligible to repay, refinance or reprice the outstanding principal amount of the loan facility without any incremental premium or other charge. As of December 31, 2020 2019 (in thousands) Term Loan Facility carrying value $ 321,046 $ 358,003 Unamortized discount 1,809 2,365 Unamortized debt issuance costs 4,020 5,257 Total Term Loan Facility 326,875 365,625 Current maturities of Term Loan Facility — (18,750) Total long-term debt $ 326,875 $ 346,875 Effective with the refinancing in April 2019, borrowings under the Term Loan Facility bear interest at either the U.S. Prime Rate plus 2.25% or LIBOR plus 3.25%, which represents a 50 basis point reduction from the applicable borrowing rates of the 2017 Term Loan Facility. Borrowings under the Term Loan Facility and 2017 Term Loan Facility had a weighted average interest rate for the years ended December 31, 2020 and 2019 of 3.8% and 5.7%, respectively (with the borrowing rate ranging from 3.4% to 5.0% and from 5.0% to 6.6%, respectively). The Term Loan Facility requires quarterly principal amortization payments of $4.7 million (or $18.8 million annually), from September 30, 2019 through March 31, 2024, with the remaining outstanding balance due at maturity on April 12, 2024. In addition, beginning for the year ended December 31, 2019, the Company may be required to make annual repayments of principal on the Term Loan Facility within ninety days of year-end of up to 50% of its annual excess cash flow as defined in the credit agreement based on a calculation of net leverage. For each of the years ended December 31, 2020 and 2019, based upon the Company’s financial results, an excess cash flow payment was not required. The Company is also required to repay certain amounts of the Term Loan Facility in connection with the non-ordinary course sale of assets, receipt of insurance proceeds, and the issuance of debt obligations, subject to certain exceptions. During the year ended December 31, 2020, the Company made principal payments on the Term Loan Facility of $38.8 million. Such payments were applied to and made in advance of the quarterly installments due in 2020 and 2021. The next quarterly principal payment is due in March 2022. During the year ended December 31, 2019, the Company made mandatory principal payments on the 2017 Term Loan Facility of $8.8 million and on the Term Loan Facility of $9.4 million, or $18.1 million in total. All mandatory repayments of the Term Loan Facility are applied without penalty or premium. Effective April 14, 2020, all voluntary prepayments, including refinancing of all or part of the borrowings, under the Term Loan Facility are permitted to be made without penalty. In October 2017, the Company also arranged as part of the credit agreement a three three The Term Loan Facility is guaranteed by the Company’s existing and subsequently acquired or organized wholly-owned U.S. restricted subsidiaries (excluding any registered broker-dealers) and secured with a first priority perfected security interest in certain domestic assets, 100% of the capital stock of each U.S. subsidiary and 65% of the capital stock of each non-U.S. subsidiary, subject to certain exclusions which, for the avoidance of doubt, such security interest shall not include any assets of regulated subsidiaries that are not permitted to be pledged by law, statute or regulation, including cash held by regulated subsidiaries and any other capital required to meet and maintain regulatory capital requirements. The credit facility contains certain covenants that limit the Company’s ability above certain permitted amounts to incur additional indebtedness, make certain acquisitions, pay dividends and repurchase shares. The Term Loan Facility does not have financial covenants but is subject to certain other non-financial covenants. At December 31, 2020 and 2019, the Company was compliant with all loan covenants. In conjunction with the refinancing of the 2017 Term Loan Facility in April 2019, the Company incurred fees of $5.7 million, of which $2.7 million was recorded as deferred financing costs and $3.0 million was expensed. In addition, as a result of the refinancing, $1.8 million of previously deferred fees, or fees in aggregate of $4.8 million, were charged to expense and recorded as interest expense in the consolidated statements of operations. The deferred financing costs incurred in connection with the refinancing, along with the remaining unamortized costs from the 2017 Term Loan Facility which, as of the date of the refinancing, were $9.0 million, are being amortized into interest expense over the remaining life of the obligation and recorded as a reduction in the carrying value of the Term Loan Facility in the consolidated statement of financial condition. For the years ended December 31, 2020 and 2019, in addition to the charge related to the refinancing in 2019, the Company incurred incremental interest expense of $1.8 million and $1.9 million, respectively, related to the amortization of these costs. |
Equity
Equity | 12 Months Ended |
Dec. 31, 2020 | |
Stockholders' Equity Note [Abstract] | |
Equity | Note 10 — Equity In September 2017, the Company announced plans for a leveraged recapitalization to use a portion of the proceeds of the term loan borrowings to repurchase shares of the Company's common stock. Since that announcement the Company has repurchased 15,040,528 shares of common stock in open market purchases or tender offers for $316.3 million. During the year ended December 31, 2020, the Company repurchased 489,704 shares of common stock through open market transactions at an average price of $17.18 per share, for a total cost of $8.4 million. During the year ended December 31, 2019, the Company repurchased 3,275,641 shares of common stock through open market transactions at an average price of $16.93 per share, for a total cost of $55.5 million. During the year ended December 31, 2018, the Company repurchased 7,497,635 shares of common stock through a modified Dutch auction tender and open market transactions at an average price of $24.89 per share, for a total cost of $186.6 million. In addition, the Company incurred fees and expenses relating to the tender offer of $0.2 million during the year ended December 31, 2018. In connection with the acquisition of Cogent, the Company issued 779,454 shares of common stock on the acquisition date, April 1, 2015. In addition, during 2019 the Company issued 334,048 shares of common stock shortly after the revenue target for the Earnout was achieved. The fair value of the contingent issuance of common shares related to the Earnout was valued on the date of the acquisition at $11.9 million and was recorded as additional paid in capital in the consolidated statements of financial condition. Upon delivery of the shares the par value of the shares was transferred to common stock in the consolidated statement of financial condition. In addition, $1.2 million was reflected as an adjustment to additional paid-in capital in the consolidated statement of financial condition for the tax effect of the difference in the acquisition date value of the contingently issuable shares and the fair value of the shares when issued. See “Note 7 — Fair Value of Financial Instruments” and “Note 11 — Earnings per Share”. During 2020, 1,863,885 restricted stock units vested and were settled in shares of common stock, of which the Company is deemed to have repurchased 764,529 shares at an average price of $19.42 per share for a total cost of $14.8 million in conjunction with the payment of tax liabilities in respect of stock delivered to its employees in settlement of restricted stock units. During 2019, 1,407,095 restricted stock units vested and were settled in shares of common stock, of which the Company is deemed to have repurchased 573,472 shares at an average price of $24.37 per share for a total cost of $14.0 million in conjunction with the payment of tax liabilities in respect of stock delivered to its employees in settlement of restricted stock units. Dividends declared and paid on outstanding common share were $0.20 for each of the years ended December 31, 2020, 2019 and 2018, respectively. In addition, dividend equivalent payments of $1.1 million, $1.3 million and $1.1 million were paid to or accrued for holders of restricted stock units for the years ended December 31, 2020, 2019 and 2018, respectively. See “Note 13 — Deferred Compensation — Restricted Stock Units”. |
Earnings per Share
Earnings per Share | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings per Share | Note 11 — Earnings per Share The computations of basic and diluted EPS are set forth below: For the Years Ended December 31, 2020 2019 2018 (in thousands, except per share amounts) Numerator for basic and diluted EPS — net income $ 31,334 $ 10,978 $ 39,222 Denominator for basic EPS — weighted average number of shares 18,939 24,025 26,813 Add — dilutive effect of: Restricted stock units 4,139 (1) 247 (1) 825 (1) Denominator for diluted EPS — weighted average number of shares and dilutive securities 23,078 24,272 27,638 Earnings per share: Basic EPS $ 1.65 $ 0.46 $ 1.46 Diluted EPS $ 1.36 $ 0.45 $ 1.42 ________________________ (1) Excludes 0, 1,480,056 and 672,518 outstanding restricted stock units that were antidilutive under the treasury stock method for the years ended December 31, 2020, 2019 and 2018, respectively, and thus were not included in the above calculation. The incremental shares that are included in the diluted EPS calculation will vary based on a variety of factors, including the average share price during the period and the amount of unrecognized compensation cost. The incremental shares included, if any, would be less than the number of outstanding restricted stock units. |
Retirement Plan
Retirement Plan | 12 Months Ended |
Dec. 31, 2020 | |
Retirement Benefits [Abstract] | |
Retirement Plan | Note 12 — Retirement Plan The Company sponsors qualified defined contribution plans in certain jurisdictions. Qualified plans comply with applicable local laws and regulations. The Company incurred costs of $1.3 million, $1.0 million and $1.3 million for contributions to the retirement plans for the years ended December 31, 2020, 2019 and 2018, respectively. There was $0.1 million related to contributions due to the retirement plans included in compensation payable on the consolidated statements of financial condition at both December 31, 2020 and 2019. |
Deferred Compensation
Deferred Compensation | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Deferred Compensation | Note 13 — Deferred Compensation Restricted Stock Units The Company has an equity incentive plan to motivate its employees and allow them to participate in the ownership of its stock. Under the Company’s plan, restricted stock units, which represent a right to a future payment equal to one share of common stock, may be awarded to employees, directors and certain other non-employees as selected by the Compensation Committee. Awards granted under the plan are generally amortized ratably over a three The activity related to the restricted stock units is set forth below: Restricted Stock Units Outstanding 2020 2019 Units Grant Date Weighted Average Fair Value Units Grant Date Weighted Average Fair Value Outstanding, January 1, 6,781,475 $ 21.60 6,210,282 $ 22.73 Granted 3,921,260 8.82 2,294,967 22.55 Delivered (1,895,249) 26.44 (1,468,700) 27.58 Forfeited (1,220,408) 15.72 (255,074) 22.84 Outstanding, December 31, 7,587,078 $ 14.68 6,781,475 $ 21.60 For the years ended December 31, 2020, 2019 and 2018, the Company recognized compensation expense from the amortization of restricted stock units, net of forfeitures, of $31.8 million, $45.8 million and $38.4 million, respectively. The weighted-average grant date fair value for restricted stock units granted during the years ended December 31, 2020, 2019 and 2018 was $8.82, $22.55 and $18.94, respectively. As of December 31, 2020, unrecognized restricted stock units compensation expense was $42.2 million, with such unrecognized compensation expense expected to be recognized over a weighted average period of approximately 1.6 years. The Company awards restricted stock units to employees under the equity incentive plan, primarily in connection with its annual bonus awards and compensation agreements for new hires. In certain jurisdictions, the Company may settle share-based payment awards in cash in lieu of shares of common stock to obtain tax deductibility. In these circumstances, the awards are settled in the cash equivalent value of the Company’s shares of common stock based upon their value at settlement date. These cash-settled share-based awards are remeasured at fair value at each reporting period. The Company also awards performance-based restricted stock units as part of long-term incentive compensation to a limited number of key employees. The actual performance relative to target performance is measured quarterly and the probability-weighted likelihood of achievement is recorded. Deferred Cash Compensation As part of its long-term incentive award program, the Company grants deferred cash retention awards to certain eligible employees. The deferred awards, which generally vest ratably over a three |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 14 — Commitments and Contingencies Diversified financial institutions in certain jurisdictions in which we operate issued four and six letters of credit on behalf of the Company to secure office space leases, which totaled $7.2 million and $9.8 million at December 31, 2020 and 2019, respectively. These letters of credit were secured by cash held on deposit. At December 31, 2020 and 2019, no amounts had been drawn under any of the letters of credit. See “Note 3 — Cash and Cash Equivalents”. The Company leases office space for its operations around the globe. See “Note 16 — Leases”. The Company is from time to time involved in legal proceedings incidental to the ordinary course of its business. The Company does not believe any such proceedings will have a material adverse effect on its results of operations. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 15 — Income Taxes The Company is subject to U.S. federal, state and local, as well as foreign, corporate income taxes. The components of the provision for income taxes reflected on the consolidated statements of operations are set forth below: For the Years Ended December 31, 2020 2019 2018 (in thousands) Current taxes: U.S. federal $ (2,794) $ 2,868 $ 1,868 State and local (306) 410 1,937 Foreign 11,535 4,982 9,968 Total current tax expense 8,435 8,260 13,773 Deferred taxes: U.S. federal 1,245 293 202 State and local 264 (534) 50 Foreign (1,517) (574) 5,183 Total deferred tax (benefit) expense (8) (815) 5,435 Total tax expense $ 8,427 $ 7,445 $ 19,208 The Company accounts for income taxes in accordance with ASC 740, which requires an asset and liability approach for financial accounting and reporting for income taxes. Deferred taxes are provided for the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts for income tax purposes. These deferred taxes are measured using the enacted tax rates and laws that will be in effect when such differences are expected to reverse. On March 27, 2020, the Coronavirus Aid, Relief and Economic Security (“CARES”) Act was enacted in response to the COVID-19 pandemic. The CARES Act, among other things, modifies the allowable amount of business interest deductions for the 2019 and 2020 tax years and allows net operating loss carryovers and carrybacks available for the three years preceding the 2021 tax year to be carried back up to five years to offset taxable income. As a result of the CARES Act, it is anticipated the Company will fully utilize its interest expense in the current year along with all deferred interest expense from prior years and be able to currently utilize the benefit of an operating loss by carrying it back to a previous year with taxable income. The currently enacted territorial-type tax system is not expected to have a significant impact to the income tax provision for the year ended December 31, 2020 or materially impact in future years. As such, the Company does not intend to indefinitely reinvest its non-U.S. subsidiary earnings outside of the United States. Effective in 2019, the Company adopted ASU No. 2016-02, Leases, requiring the recognition of lease assets and liabilities for operating leases. As part of the adoption of this new accounting standard, temporary differences are recognized for tax purposes and reflected separately in the balance sheet as deferred lease assets and lease liabilities. During 2020, the Company relocated its headquarters office to new office space in New York City and entered into a new lease effective April 1, 2020. This new lease had a significant effect on the operating lease right-of-use deferred tax asset and related operating lease deferred tax liability for the year ended December 31, 2020. Significant components of the Company’s net deferred tax assets and liabilities are set forth below: As of December 31, 2020 2019 (in thousands) Deferred tax assets: Compensation and benefits $ 18,261 $ 21,706 Depreciation and amortization 642 1,816 Cumulative translation adjustment 10,079 12,235 Operating loss carryforwards 11,736 4,644 Capital loss carryforwards 2,298 1,874 Lease asset 23,867 7,652 Other financial accruals 448 3,760 Valuation allowances (2,298) (2,409) Total deferred tax assets 65,033 51,278 Deferred tax liabilities: Lease liability 19,139 6,959 Other financial accruals 6,934 5,045 Total deferred tax liabilities 26,073 12,004 Net deferred tax asset $ 38,960 $ 39,274 Aside from the required reporting of its lease asset for ASU No. 2016-02, the Company’s largest deferred tax asset principally relates to compensation expense deducted for book purposes but not yet deducted for tax purposes. Based on the Company’s historical taxable income and its expectation for taxable income in the future, management expects this deferred tax asset related to compensation will be realized as offsets to future taxable income. The Company’s deferred taxes for operating loss carryforwards relate to a loss incurred in the United States in the current year along with losses incurred in foreign jurisdictions. The United States and its more established foreign jurisdictions have been profitable in prior years and the Company believes it is more likely than not they will be profitable in future years. However, management has carefully considered the need for a valuation allowance by evaluating each jurisdiction separately and considering items such as historical and estimated future taxable income, cost bases, and other various factors including the ability to carryback operating losses. Based on all available information, the Company has determined that it is more likely than not that it will realize the full benefit of these operating loss carryforwards and other deferred tax assets in the United States and its foreign jurisdictions. As of December 31, 2020, the Company had operating loss carryforwards which in aggregate totaled $36.5 million, and the Company intends to utilize $19.6 million of these aggregate losses by carrying them back to prior years with taxable income. Depending on the jurisdiction, these operating loss carryforwards may be carried forward five years or longer. In addition to operating loss carryforwards, the Company has capital loss carryforwards related to the sale of its investments, and these capital loss carryforwards can only be utilized against capital gains in the same jurisdiction. Approximately $2.1 million of the deferred tax asset related to capital loss carryforwards can be carried forward indefinitely and $0.2 million can be carried forward for five years. However, since the Company has nominal remaining investments and considers it more likely than not that the Company will generate capital gains, the Company has established a full valuation allowance against the deferred tax assets related to these capital losses. The Company is subject to the income tax laws of the United States, its states and municipalities, and those of the foreign jurisdictions in which the Company operates. These laws are complex, and the manner in which they apply to the taxpayer’s facts is sometimes open to interpretation. Management must make judgments in assessing the likelihood that a tax position will be sustained upon examination by the taxing authorities based on the technical merits of the tax position. In the normal course of business, the Company may be under audit in one or more of its jurisdictions in an open tax year for that particular jurisdiction. As of December 31, 2020, the Company does not expect any material changes in its tax provision related to any current or future audits. The Company recognizes tax positions in the financial statements only when management believes it is more likely than not that the position will be sustained on examination by the relevant taxing authority based on the technical merits of the position. A position that meets this standard is measured at the largest amount of benefit that will more likely than not be realized on settlement. A liability is established for differences between positions taken in a tax return and amounts recognized in the financial statements. The Company performed an analysis of its tax positions as of December 31, 2020, and determined that there was no requirement to accrue any material additional liabilities. Also, when present as part of the tax provision calculation, interest and penalties have been reported as other operating expenses in the consolidated statements of operations. A reconciliation of the statutory U.S. federal income tax rate of 21% to the Company’s effective income tax rates is set forth below: For the Years Ended December 31, 2020 2019 2018 U.S. statutory tax rate 21.0 % 21.0 % 21.0 % Increase related to state and local taxes, net of U.S. income tax benefit (3.0) (0.5) 2.6 Benefits and taxes related to foreign operations (7.3) 8.8 (1.5) Charge related to Global Intangible Low-Taxed Income — 2.0 1.3 RSU vesting and dividend discrete accounting charge or benefit 13.3 6.3 8.0 Charge related to non-deductible compensation 2.4 3.3 1.8 Tax Benefits Related to CARES Act (4.6) — — Other (0.6) (0.5) (0.3) Effective income tax rate 21.2 % 40.4 % 32.9 % |
Leases
Leases | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Leases | Note 16 — Leases The Company leases office space for its operations around the globe. All of the Company’s leases are operating leases and have remaining lease terms ranging from less than 1 year to 15 years. The Company incurred operating lease cost, excluding property taxes, utilities and other ancillary costs, of $18.5 million (including $4.9 million related to the free rent period on the new headquarters' location), $15.3 million and $15.0 million for the years ended December 31, 2020, 2019 and 2018, respectively, which is included in occupancy and equipment rental in the consolidated statements of operations. The undiscounted aggregate minimum future rental payments as of December 31, 2020 are as follows: (in thousands) 2021 $ 11,671 2022 11,190 2023 10,171 2024 9,329 2025 8,756 Thereafter 76,875 Total lease payments 127,992 Plus: tenant incentive utilized to finance leasehold improvements 11,302 Less: Interest (44,197) Present value of operating lease liabilities for which the Company has a right-of-use asset and corresponding liability $ 95,097 The weighted average remaining lease term and weighted average discount rate of our operating leases are as follows: As of December 31, 2020 2019 Weighted average remaining lease term in years, including the lease for which the right to use has not commenced 12.7 12.1 Weighted average discount rate 6.8 % 5.8 % |
Regulatory
Regulatory | 12 Months Ended |
Dec. 31, 2020 | |
Broker-Dealer, Net Capital Requirement, SEC Regulation [Abstract] | |
Regulatory | Note 17 — Regulatory Certain subsidiaries of the Company are subject to various regulatory requirements in the United States, United Kingdom, Germany, Australia and certain other jurisdictions, which specify, among other requirements, minimum net capital requirements for registered broker-dealers. G&Co is subject to the SEC’s Uniform Net Capital requirements under Rule 15c3-1 (the “Rule”), which specifies, among other requirements, minimum net capital requirements for registered broker-dealers. The Rule requires G&Co to maintain a minimum net capital of the greater of $5,000 or 1/15 of aggregate indebtedness, as defined in the Rule. As of December 31, 2020 and 2019, G&Co’s net capital was $17.3 million and $24.5 million, respectively, which exceeded its requirement by $14.7 million and $23.2 million, respectively. G&Co’s aggregate indebtedness to net capital ratio was 2.2 to 1 and 0.8 to 1 at December 31, 2020 and 2019, respectively. Certain distributions and other capital withdrawals of G&Co are subject to certain notifications and restrictive provisions of the Rule. |
Business Information
Business Information | 12 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
Business Information | Note 18 — Business Information The Company’s activities as an investment banking firm constitute a single business segment, with substantially all revenues generated from advisory services, which includes engagements relating to mergers and acquisitions, financing advisory and restructuring, and private capital advisory services. The Company principally earns its revenues from advisory fees upon the successful completion of the client’s transaction or restructuring. In 2020, there was one client that accounted for approximately 14% of total revenues. In 2019, there was one client that accounted for approximately 11% of revenues. In 2018, there were no clients that accounted for more than 10% of total revenues. Since the financial markets are global in nature, the Company generally manages its business based on the operating results of the enterprise taken as whole, not by geographic region. For reporting purposes, the geographic regions are the North America, Europe, and the rest of the world, which are the locations where the Company retains substantially all of its employees. The following table presents information about the Company by geographic region, after elimination of all significant inter-company accounts and transactions: As of or for the Years Ended December 31, 2020 2019 2018 (in thousands) Revenues North America $ 167,038 $ 212,916 $ 193,707 Europe 127,631 46,827 125,149 Rest of World 17,009 41,269 33,129 Total $ 311,678 $ 301,012 $ 351,985 Operating income (loss) North America $ (5,238) $ 38,116 $ 16,472 Europe 62,603 (9,964) 57,736 Rest of World (2,117) 17,691 6,660 Total $ 55,248 $ 45,843 $ 80,868 Total assets North America $ 297,579 $ 196,603 $ 198,313 Europe 138,632 129,725 152,478 Rest of World 149,588 168,047 134,909 Total $ 585,799 $ 494,375 $ 485,700 The Company's revenues are based on the country where the services were derived. For the years ended December 31, 2020, 2019 and 2018, the Company generated 52%, 67%, and 52%, respectively, of its total revenues from the United States and 36%, 12% and 29% respectively, of its total revenues from the United Kingdom. No other country had revenues which individually represented more than 10% of the Company’s total revenues during the years ended December 31, 2020, 2019 and 2018, respectively. Included in the Company’s total assets are long-lived assets, excluding deferred tax assets, lease right-of-use assets and intangible assets, located in the United States of $29.4 million and $22.8 million at December 31, 2020 and 2019, respectively. No other country had long-lived assets, which individually represented more than 10% of the Company’s total long-lived assets at December 31, 2020 and 2019. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 19 — Subsequent Events The Company evaluates subsequent events through the date on which the financial statements are issued. On February 3, 2021, the Board of Directors of the Company declared a quarterly dividend of $0.05 per share. The dividend will be payable on March 17, 2021 to the common stockholders of record on March 3, 2021. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of Financial Information | Basis of Financial Information These consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States (U.S. GAAP), which require management to make estimates and assumptions regarding future events that affect the amounts reported in our financial statements and these footnotes, including compensation accruals and other matters. Management believes that it has made all necessary adjustments so that the consolidated financial statements are presented fairly and that the estimates used in preparing its consolidated financial statements are reasonable and prudent. Actual results could differ materially from those estimates. Certain reclassifications have been made to prior year information to conform to current year presentation. Given the uncertainty of the COVID-19 pandemic and resulting economic impact on the Company, estimates may need to be revised in the future, which could materially impact the Company's future results of operations and/or financial condition. The consolidated financial statements of the Company include all consolidated accounts of Greenhill & Co., Inc. and all other entities in which the Company has a controlling interest after eliminations of all significant inter-company accounts and transactions. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue when (or as) services are transferred to clients. Revenue is recognized based on the amount of consideration that management expects to receive in exchange for these services in accordance with the terms of the contract with the client. To determine the amount and timing of revenue recognition, the Company must (1) identify the contract with the client, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue when (or as) the Company satisfies a performance obligation. The Company generally recognizes revenues for mergers and acquisitions engagements at the earlier of the announcement date or transaction date, as the performance obligation is typically satisfied at such time. Upfront fees and certain retainer fees are generally deferred until the announcement or transaction date, as they are considered constrained (subject to significant reversal) prior to the announcement or transaction date. Fairness opinion fees are recognized when the opinion is delivered. The Company recognizes revenues for financing advisory and restructuring engagements as the services are provided to the client, based on the terms of the engagement letter. In such arrangements, the Company’s performance obligations are to provide financial and strategic advice throughout an engagement. The Company recognizes revenues for private capital advisory fees when (1) the commitment of capital is secured (primary capital raising transactions) or the sale or transfer of the capital interest occurs (secondary market transactions) and (2) the fees are earned from the client in accordance with terms of the engagement letter. Upfront fees and certain retainer fees are deferred until the commitment is secured or the sale or transfer of the capital interest occurs, as the fees are considered constrained (subject to significant reversal) prior to such time. As a result of the deferral of certain fees, deferred revenue (also known as contract liabilities) was $7.1 million and $3.9 million as of December 31, 2020 and December 31, 2019, respectively. Deferred revenue is included in accounts payable and accrued expenses in the consolidated statements of financial condition. During the years ended December 31, 2020, 2019 and 2018, the Company recognized $2.3 million, $4.7 million and $9.3 million of revenues, respectively, that were included in the deferred revenue (contract liabilities) balance at the beginning of each respective period. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company’s cash and cash equivalents consist of (i) cash held on deposit with financial institutions, (ii) cash equivalents and (iii) restricted cash. The Company maintains its cash and cash equivalents with financial institutions with high credit ratings. The Company considers all highly liquid investments with an original maturity date of three months or less, when purchased, to be cash equivalents. Cash equivalents primarily consist of money market funds and other short-term highly liquid investments with original maturities of three months or less and are carried at cost, plus accrued interest, which approximates the fair value due to the short-term nature of these investments. |
Fees Receivable | Fees Receivable Receivables are stated net of an allowance for doubtful accounts. The estimate for the allowance for doubtful accounts is derived by the Company by utilizing past client transaction history and an assessment of the client’s creditworthiness. The Company recorded bad debt expense of $0.3 million, $1.2 million and $0.3 million for the years ended December 31, 2020, 2019 and 2018, respectively. Credit risk related to fees receivable is dispersed across a large number of clients located in various geographic areas. The Company controls credit risk through credit approvals and monitoring procedures but does not require collateral to support accounts receivable. On January 1, 2020, the Company adopted ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326) - Measurement of Credit Losses on Financial Instruments ("ASU 2016-13") under the modified retrospective approach. ASU 2016-13 replaces the incurred loss impairment methodology for financial instruments with the current expected credit loss (CECL) model which requires an estimate of future credit losses. Upon adoption, a cumulative adjustment was recorded which decreased retained earnings by $0.1 million, net of tax, as of January 1, 2020. |
Goodwill | Goodwill Goodwill is the cost in excess of the fair value of identifiable net assets at the acquisition date. The Company tests its goodwill for impairment annually or more frequently where certain events or changes in circumstances indicate that goodwill may more likely than not that impairment may have occurred. An impairment loss is triggered if the estimated fair value of an operating unit is less than the estimated net book value. Such loss is calculated as the difference between the estimated fair value of goodwill and its carrying value. See “Note 5 — Goodwill”. Goodwill is translated at the rate of exchange prevailing at the end of the periods presented in accordance with the accounting guidance for foreign currency translation. Any translation gain or loss is included in the foreign currency translation adjustment, which is included as a component of other comprehensive income (loss) in the consolidated statements of changes in stockholders’ equity. |
Compensation Payable | Compensation Payable Included in compensation payable are discretionary compensation awards comprised of accrued cash bonuses and long-term incentive compensation, consisting of deferred cash retention awards, which are non-interest bearing, and generally amortized ratably over a three |
Restricted Stock Units | Restricted Stock Units The Company accounts for its share-based compensation payments by recording the fair value of restricted stock units (RSUs) granted to employees as compensation expense. The restricted stock units are generally amortized ratably over a three As the Company expenses the awards, the restricted stock units recognized are recorded within stockholders’ equity. The restricted stock units are reclassified into common stock and additional paid-in capital upon vesting. The Company records as treasury stock the repurchase of stock delivered to its employees in settlement of tax liabilities incurred upon the vesting of restricted stock units. The Company records dividend equivalent payments on outstanding restricted stock units eligible for such payment as a dividend payment and a charge to stockholders’ equity. |
Earnings per Share | Earnings per ShareThe Company calculates basic earnings per share (“EPS”) by dividing net income by the weighted average number of shares outstanding for the period. The Company calculates diluted EPS by dividing net income by the sum of (i) the weighted average number of shares outstanding for the period and (ii) the dilutive effect of the common stock deliverable pursuant to restricted stock units for which future service is required as calculated using the treasury stock method. |
Provision for Taxes | Provision for Taxes The Company accounts for taxes in accordance with the accounting guidance for income taxes which requires the recognition of tax benefits or expenses on the temporary differences between the financial reporting and tax bases of its assets and liabilities. The Company follows the guidance for income taxes in recognizing, measuring, presenting and disclosing in its financial statements uncertain tax positions taken or expected to be taken on its income tax returns. Income tax expense is based on pre-tax accounting income, including adjustments made for the recognition or derecognition related to uncertain tax positions. The recognition or derecognition of income tax expense related to uncertain tax positions is determined under the guidance, and the Company’s policy is to treat interest and penalties related to uncertain tax positions as part of pre-tax income. Deferred tax assets and liabilities are recognized for the future tax attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in earnings in the period of change. Management applies the “more-likely-than-not criteria” when determining tax benefits. |
Foreign Currency Translation | Foreign Currency Translation Assets and liabilities denominated in foreign currencies have been translated at rates of exchange prevailing at the end of the periods presented in accordance with the accounting guidance for foreign currency translation. Income and expenses transacted in foreign currency have been translated at average monthly exchange rates during the period. Translation gains and losses are included in the foreign currency translation adjustment, which is included as a component of other comprehensive income (loss) in the consolidated statements of changes in stockholders’ equity. Foreign currency transaction gains and losses are included in the consolidated statements of operations in other operating expenses. |
Financial Instruments and Fair Value | Financial Instruments and Fair Value The Company accounts for financial instruments measured at fair value in accordance with accounting guidance for fair value measurements and disclosures which establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy under the pronouncement are described below: Basis of Fair Value Measurement Level 1 – Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; Level 2 – Quoted prices in markets that are not active or financial instruments for which all significant inputs are observable, either directly or indirectly; and Level 3 – Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. In determining the appropriate levels, the Company performs an analysis of the assets and liabilities that are subject to these disclosures. At each reporting period, all assets and liabilities for which the fair value measurement is based on significant unobservable inputs or instruments which trade infrequently and therefore have little or no price transparency are classified as Level 3. Transfers between levels are recognized as of the end of the period in which they occur. See “Note 7 — Fair Value of Financial Instruments”. |
Leases | Leases The Company leases office space for its operations around the globe. Certain leases include options to renew, which can be exercised at the Company’s sole discretion. The Company determines if a contract contains a lease at contract inception. Operating lease assets represent the Company’s right to use the underlying asset and operating lease liabilities represent the Company’s obligation to make lease payments. Operating lease assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. When determining the lease term, the Company generally does not include options to renew as it is not reasonably certain at contract inception that the Company will exercise the option(s). The Company uses the implicit rate when readily determinable and its incremental borrowing rate when the implicit rate is not readily determinable. The Company’s incremental borrowing rate is determined using its secured borrowing rate and giving consideration to the currency and term of the associated lease as appropriate. The lease payments used to determine the Company’s operating lease assets may include lease incentives, stated rent increases and escalation clauses linked to rates of inflation when determinable and are recognized in operating lease assets in the consolidated statement of financial condition. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. The straight-lining of rent expense results in differences in the operating lease right-of-use asset and operating lease obligations on the consolidated statement of financial condition. Temporary differences are recognized for tax purposes and reflected separately in the consolidated statement of financial condition as deferred lease assets and lease liabilities within deferred tax assets and deferred tax liabilities. |
Property and Equipment | Property and Equipment Property and equipment is stated at cost less accumulated depreciation and amortization. Depreciation is computed using the straight-line method over the life of the assets. Amortization of leasehold improvements is computed using the straight-line method over the lesser of the life of the asset or the remaining term of the lease. Estimated useful lives of the Company’s fixed assets are generally as follows: Equipment – 5 years Furniture and fixtures – 7 years Leasehold improvements – the lesser of 15 years or the remaining lease term |
Business Information | Business InformationThe Company’s activities as an investment banking firm constitute a single business segment, with substantially all revenues generated from advisory services, which includes engagements relating to mergers and acquisitions, financing advisory and restructuring, and private capital advisory services. |
Recently Adopted Accounting Pronouncements; Accounting Developments | Recently Adopted Accounting Pronouncements In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326) - Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). This ASU changes how companies measure credit losses on most financial instruments, including accounts receivable. Companies will be required to estimate lifetime expected credit losses, which is generally expected to result in earlier recognition of credit losses. The Company adopted this standard effective on January 1, 2020 under a modified retrospective approach. The cumulative effect of adopting this ASU was a net decrease to retained earnings of $0.1 million. In February 2016, the FASB issued ASU No. 2016-02, Leases (“ASU 2016-02”), which requires the recognition of lease assets and lease liabilities for operating leases, among other changes. The Company adopted this standard on January 1, 2019 utilizing a modified retrospective approach. The Company elected to apply practical expedients provided in the standard that allowed the Company to not reassess whether expired or existing contracts are or contain leases, not reassess lease classification for expired or existing leases (e.g., pre-existing operating leases are classified as operating leases under the new standard), and not reassess initial direct costs for existing leases. The impact of adopting ASU 2016-02 was an increase of $38.1 million to the Company’s assets and liabilities for the operating lease right-of-use assets and operating lease obligations on the consolidated statement of financial condition as of January 1, 2019. Upon adoption, the Company also reclassified $3.2 million of deferred rent from accounts payable and accrued expenses to operating lease obligations on the condensed consolidated statement of financial condition. Differences in the operating lease right-of-use asset and operating lease obligations are due to straight-lining rent expense and the resulting deferred rent. There was no net impact to the consolidated statement of operations. In May 2014, the FASB issued ASU 2014-09 “Revenue from Contracts with Customers” codifying ASC 606, Revenue Recognition — Revenue from Contracts with Customers, which supersedes the guidance in former ASC 605, Revenue Recognition. The Company adopted this standard on January 1, 2018 utilizing the modified retrospective approach and applied the standard to contracts that were not completed at this time. Upon adoption, certain revenues that were previously recognized as services were provided changed to either point in time recognition or over the term of an engagement. This change in the Company’s revenue recognition policy created deferred revenues (also known as contract liabilities) that will be recognized at a point in time as performance obligations are met. The cumulative effect of adopting this ASU on January 1, 2018 was a net decrease to retained earnings of $7.6 million. The Company also changed the presentation of certain reimbursed costs from a net presentation prior to adoption to a gross presentation following adoption. Accounting Developments |
Cash and Cash Equivalents (Tabl
Cash and Cash Equivalents (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Cash and Cash Equivalents [Abstract] | |
Schedule of Carrying Values of Cash and Cash Equivalents | The carrying values of the Company’s cash and cash equivalents are as follows: As of December 31, 2020 2019 (in thousands) Cash $ 52,335 $ 59,455 Cash equivalents 53,198 44,751 Restricted cash - letters of credit 7,170 9,769 Total cash and cash equivalents $ 112,703 $ 113,975 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Components of Property and Equipment | Property and equipment consist of the following: As of December 31, 2020 2019 (in thousands) Equipment $ 11,503 $ 22,452 Furniture and fixtures 6,396 7,758 Leasehold improvements 20,797 23,806 Total property and equipment, gross 38,696 54,016 Less accumulated depreciation and amortization (17,454) (47,735) Total property and equipment, net $ 21,242 $ 6,281 |
Goodwill (Tables)
Goodwill (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Changes in Carrying Value of Goodwill | Goodwill consists of the following: As of December 31, 2020 2019 (in thousands) Balance, January 1 $ 205,992 $ 205,922 Foreign currency translation adjustments 9,944 70 Balance, December 31 $ 215,936 $ 205,992 |
Other Assets (Tables)
Other Assets (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of Other Assets | Other assets consist of the following: As of December 31, 2020 2019 (in thousands) Prepaid expenses and other assets $ 6,533 $ 6,098 Rent deposits 1,631 1,856 Other tangible assets 77 264 Total other assets $ 8,241 $ 8,218 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Liabilities Measured at Fair Value on a Recurring Basis | The following tables set forth the measurement at fair value on a recurring basis of the investments in money market funds, short-term cash instruments and U.S. government securities. The securities are categorized as a Level 1 asset, as their valuation is based on quoted prices for identical assets in active markets. See “Note 3 — Cash and Cash Equivalents”. Assets Measured at Fair Value on a Recurring Basis as of December 31, 2020 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Balance as of December 31, 2020 (in thousands) Assets Cash equivalents $ 53,198 $ — $ — $ 53,198 Total $ 53,198 $ — $ — $ 53,198 Assets Measured at Fair Value on a Recurring Basis as of December 31, 2019 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Balance as of December 31, 2019 (in thousands) Assets Cash equivalents $ 44,751 $ — $ — $ 44,751 Total $ 44,751 $ — $ — $ 44,751 |
Changes in Level 3 Measured at Fair Value | Changes in Level 3 liabilities measured at fair value on a recurring basis for the year ended December 31, 2018 Opening Balance as of January 1, 2018 Total realized and unrealized gains (losses) included in Net Income Unrealized gains (losses) included in Other Comprehensive Income Purchases Issues Sales Transfers Out Closing Balance as of December 31, 2018 Unrealized gains (losses) for Level 3 liabilities outstanding at December 31, 2018 (in thousands) Liabilities Contingent obligation due selling unitholders of Cogent $ 13,763 $ (4,021) $ — $ — $ — $ — $ (17,784) $ — $ — Total $ 13,763 $ (4,021) $ — $ — $ — $ — $ (17,784) $ — $ — |
Loan Facilities (Tables)
Loan Facilities (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt | As of December 31, 2020 2019 (in thousands) Term Loan Facility carrying value $ 321,046 $ 358,003 Unamortized discount 1,809 2,365 Unamortized debt issuance costs 4,020 5,257 Total Term Loan Facility 326,875 365,625 Current maturities of Term Loan Facility — (18,750) Total long-term debt $ 326,875 $ 346,875 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Computations of Basic and Diluted Earnings Per Share | The computations of basic and diluted EPS are set forth below: For the Years Ended December 31, 2020 2019 2018 (in thousands, except per share amounts) Numerator for basic and diluted EPS — net income $ 31,334 $ 10,978 $ 39,222 Denominator for basic EPS — weighted average number of shares 18,939 24,025 26,813 Add — dilutive effect of: Restricted stock units 4,139 (1) 247 (1) 825 (1) Denominator for diluted EPS — weighted average number of shares and dilutive securities 23,078 24,272 27,638 Earnings per share: Basic EPS $ 1.65 $ 0.46 $ 1.46 Diluted EPS $ 1.36 $ 0.45 $ 1.42 ________________________ (1) Excludes 0, 1,480,056 and 672,518 outstanding restricted stock units that were antidilutive under the treasury stock method for the years ended December 31, 2020, 2019 and 2018, respectively, and thus were not included in the above calculation. The incremental shares that are included in the diluted EPS calculation will vary based on a variety of factors, including the average share price during the period and the amount of unrecognized compensation cost. The incremental shares included, if any, would be less than the number of outstanding restricted stock units. |
Deferred Compensation (Tables)
Deferred Compensation (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Restricted Stock Units Activity | The activity related to the restricted stock units is set forth below: Restricted Stock Units Outstanding 2020 2019 Units Grant Date Weighted Average Fair Value Units Grant Date Weighted Average Fair Value Outstanding, January 1, 6,781,475 $ 21.60 6,210,282 $ 22.73 Granted 3,921,260 8.82 2,294,967 22.55 Delivered (1,895,249) 26.44 (1,468,700) 27.58 Forfeited (1,220,408) 15.72 (255,074) 22.84 Outstanding, December 31, 7,587,078 $ 14.68 6,781,475 $ 21.60 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Components of Provision for Income Taxes | The components of the provision for income taxes reflected on the consolidated statements of operations are set forth below: For the Years Ended December 31, 2020 2019 2018 (in thousands) Current taxes: U.S. federal $ (2,794) $ 2,868 $ 1,868 State and local (306) 410 1,937 Foreign 11,535 4,982 9,968 Total current tax expense 8,435 8,260 13,773 Deferred taxes: U.S. federal 1,245 293 202 State and local 264 (534) 50 Foreign (1,517) (574) 5,183 Total deferred tax (benefit) expense (8) (815) 5,435 Total tax expense $ 8,427 $ 7,445 $ 19,208 |
Significant Components of Net Deferred Tax Assets and Liabilities | Significant components of the Company’s net deferred tax assets and liabilities are set forth below: As of December 31, 2020 2019 (in thousands) Deferred tax assets: Compensation and benefits $ 18,261 $ 21,706 Depreciation and amortization 642 1,816 Cumulative translation adjustment 10,079 12,235 Operating loss carryforwards 11,736 4,644 Capital loss carryforwards 2,298 1,874 Lease asset 23,867 7,652 Other financial accruals 448 3,760 Valuation allowances (2,298) (2,409) Total deferred tax assets 65,033 51,278 Deferred tax liabilities: Lease liability 19,139 6,959 Other financial accruals 6,934 5,045 Total deferred tax liabilities 26,073 12,004 Net deferred tax asset $ 38,960 $ 39,274 |
Reconciliation of Statutory U.S. Federal Income Tax Rate to Company's Effective Income Tax Rate | A reconciliation of the statutory U.S. federal income tax rate of 21% to the Company’s effective income tax rates is set forth below: For the Years Ended December 31, 2020 2019 2018 U.S. statutory tax rate 21.0 % 21.0 % 21.0 % Increase related to state and local taxes, net of U.S. income tax benefit (3.0) (0.5) 2.6 Benefits and taxes related to foreign operations (7.3) 8.8 (1.5) Charge related to Global Intangible Low-Taxed Income — 2.0 1.3 RSU vesting and dividend discrete accounting charge or benefit 13.3 6.3 8.0 Charge related to non-deductible compensation 2.4 3.3 1.8 Tax Benefits Related to CARES Act (4.6) — — Other (0.6) (0.5) (0.3) Effective income tax rate 21.2 % 40.4 % 32.9 % |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Schedule of undiscounted aggregate minimum future rental payments | The undiscounted aggregate minimum future rental payments as of December 31, 2020 are as follows: (in thousands) 2021 $ 11,671 2022 11,190 2023 10,171 2024 9,329 2025 8,756 Thereafter 76,875 Total lease payments 127,992 Plus: tenant incentive utilized to finance leasehold improvements 11,302 Less: Interest (44,197) Present value of operating lease liabilities for which the Company has a right-of-use asset and corresponding liability $ 95,097 |
Schedule of weighted average remaining lease term and weighted average discount rate for operating leases | The weighted average remaining lease term and weighted average discount rate of our operating leases are as follows: As of December 31, 2020 2019 Weighted average remaining lease term in years, including the lease for which the right to use has not commenced 12.7 12.1 Weighted average discount rate 6.8 % 5.8 % |
Business Information (Tables)
Business Information (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
Information by Geographic Region, After Elimination of All Significant Inter-company Accounts and Transactions | The following table presents information about the Company by geographic region, after elimination of all significant inter-company accounts and transactions: As of or for the Years Ended December 31, 2020 2019 2018 (in thousands) Revenues North America $ 167,038 $ 212,916 $ 193,707 Europe 127,631 46,827 125,149 Rest of World 17,009 41,269 33,129 Total $ 311,678 $ 301,012 $ 351,985 Operating income (loss) North America $ (5,238) $ 38,116 $ 16,472 Europe 62,603 (9,964) 57,736 Rest of World (2,117) 17,691 6,660 Total $ 55,248 $ 45,843 $ 80,868 Total assets North America $ 297,579 $ 196,603 $ 198,313 Europe 138,632 129,725 152,478 Rest of World 149,588 168,047 134,909 Total $ 585,799 $ 494,375 $ 485,700 |
Organization (Details)
Organization (Details) | Dec. 31, 2020state |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of states in which entity is licensed to operate (states) | 50 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2020USD ($)Segment | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Jan. 01, 2020USD ($) | Jan. 01, 2019USD ($) | Jan. 01, 2018USD ($) | |
Significant Accounting Policies [Line Items] | ||||||
Contract with customer, liability | $ 7,100 | $ 3,900 | ||||
Revenues | 311,678 | 301,012 | $ 351,985 | |||
Allowance for doubtful accounts | 263 | 1,197 | 0 | |||
Retained earnings | $ (95,424) | (69,093) | ||||
Depreciation and amortization of property and equipment | Depreciation is computed using the straight-line method over the life of the assets. Amortization of leasehold improvements is computed using the straight-line method over the lesser of the life of the asset or the remaining term of the lease. | |||||
Number of business segments | Segment | 1 | |||||
Operating lease right-of-use asset | $ 76,440 | 28,346 | ||||
Operating lease obligations | $ 95,097 | 30,750 | ||||
Accounting Standards Update 2016-02 | ||||||
Significant Accounting Policies [Line Items] | ||||||
Operating lease right-of-use asset | $ 38,100 | |||||
Operating lease obligations | 38,100 | |||||
Deferred rent | $ 3,200 | |||||
Cumulative effect of the change in accounting principle related to credit losses | ||||||
Significant Accounting Policies [Line Items] | ||||||
Retained earnings | $ 100 | |||||
Cumulative effect of the change in accounting principle related to revenue recognition | ||||||
Significant Accounting Policies [Line Items] | ||||||
Retained earnings | $ 7,600 | |||||
Minimum | ||||||
Significant Accounting Policies [Line Items] | ||||||
Amortization period of deferred cash retention awards | 3 years | |||||
Maximum | ||||||
Significant Accounting Policies [Line Items] | ||||||
Amortization period of deferred cash retention awards | 5 years | |||||
Equipment | ||||||
Significant Accounting Policies [Line Items] | ||||||
Estimated useful lives of fixed assets (or lesser for Leaseholds) | 5 years | |||||
Furniture and fixtures | ||||||
Significant Accounting Policies [Line Items] | ||||||
Estimated useful lives of fixed assets (or lesser for Leaseholds) | 7 years | |||||
Leasehold improvements | ||||||
Significant Accounting Policies [Line Items] | ||||||
Estimated useful lives of fixed assets (or lesser for Leaseholds) | 15 years | |||||
Restricted Stock | Minimum | ||||||
Significant Accounting Policies [Line Items] | ||||||
Amortization period of restricted stock units | 3 years | |||||
Restricted Stock | Maximum | ||||||
Significant Accounting Policies [Line Items] | ||||||
Amortization period of restricted stock units | 5 years | |||||
Advisory Services | ||||||
Significant Accounting Policies [Line Items] | ||||||
Contract with customer, liability, revenue recognized | $ 2,300 | 4,700 | 9,300 | |||
Cumulative effect of the change in accounting principle | ||||||
Significant Accounting Policies [Line Items] | ||||||
Retained earnings | $ 100 | |||||
Reimbursement Revenue | ||||||
Significant Accounting Policies [Line Items] | ||||||
Revenues | 2,700 | 6,400 | 7,000 | |||
Advisory Fees | ||||||
Significant Accounting Policies [Line Items] | ||||||
Allowance for doubtful accounts | $ 300 | $ 1,200 | $ 300 |
Cash and Cash Equivalents (Deta
Cash and Cash Equivalents (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Cash and Cash Equivalents [Abstract] | ||||
Cash | $ 52,335 | $ 59,455 | ||
Cash equivalents | 53,198 | 44,751 | ||
Restricted cash - letters of credit | 7,170 | 9,769 | ||
Total cash and cash equivalents | $ 112,703 | $ 113,975 | $ 156,374 | $ 267,646 |
Cash and Cash Equivalents - Nar
Cash and Cash Equivalents - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Jun. 30, 2024 | Jun. 30, 2019 | |
Cash and Cash Equivalents [Line Items] | |||
Letters of credit outstanding, amount | $ 5.9 | ||
Standby Letters of Credit | |||
Cash and Cash Equivalents [Line Items] | |||
Line of credit facility, expired capacity, amount | $ 2.3 | ||
Forecast | |||
Cash and Cash Equivalents [Line Items] | |||
Letters of credit outstanding, amount | $ 3.5 |
Property and Equipment - Compon
Property and Equipment - Components of Property and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Property, Plant and Equipment [Abstract] | ||
Equipment | $ 11,503 | $ 22,452 |
Furniture and fixtures | 6,396 | 7,758 |
Leasehold improvements | 20,797 | 23,806 |
Total property and equipment, gross | 38,696 | 54,016 |
Less accumulated depreciation and amortization | (17,454) | (47,735) |
Total property and equipment, net | $ 21,242 | $ 6,281 |
Goodwill - Changes in Carrying
Goodwill - Changes in Carrying Value (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Goodwill | ||
Balance, January 1 | $ 205,992 | $ 205,922 |
Foreign currency translation adjustments | 9,944 | 70 |
Balance, December 31 | $ 215,936 | $ 205,992 |
Other Assets - Components of Ot
Other Assets - Components of Other Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Prepaid expenses and other assets | $ 6,533 | $ 6,098 |
Rent deposits | 1,631 | 1,856 |
Other tangible assets | 77 | 264 |
Total other assets | $ 8,241 | $ 8,218 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - Fair Value on a Recurring Basis (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Assets | ||
Cash equivalents | $ 53,198 | $ 44,751 |
Total | 53,198 | 44,751 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets | ||
Cash equivalents | 53,198 | 44,751 |
Total | 53,198 | 44,751 |
Significant Other Observable Inputs (Level 2) | ||
Assets | ||
Cash equivalents | 0 | 0 |
Total | 0 | 0 |
Significant Unobservable Inputs (Level 3) | ||
Assets | ||
Cash equivalents | 0 | 0 |
Total | $ 0 | $ 0 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - Narrative (Details) - USD ($) $ in Thousands | Apr. 01, 2015 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Increase (decrease) in fair value of contingent obligation | $ 0 | $ 575 | $ 4,531 | |
Cogent Partners, LP | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Contingent consideration, cash | $ 18,900 | |||
Possible contingent consideration (in shares) | 334,048 | |||
Contingent obligation due selling unitholders of Cogent | $ 13,100 | |||
Increase (decrease) in fair value of contingent obligation | $ 600 | $ 4,500 |
Fair Value of Financial Instr_5
Fair Value of Financial Instruments - Changes in Level 3 Liabilities (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Opening Balance | $ 13,763 |
Total realized and unrealized gains (losses) included in Net Income | (4,021) |
Unrealized gains (losses) included in Other Comprehensive Income | 0 |
Purchases | 0 |
Issues | 0 |
Sales | 0 |
Transfers Out | (17,784) |
Closing Balance | 0 |
Unrealized gains (losses) for Level 3 liabilities outstanding at end of the period | 0 |
Contingent Consideration Liability | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Opening Balance | 13,763 |
Total realized and unrealized gains (losses) included in Net Income | (4,021) |
Unrealized gains (losses) included in Other Comprehensive Income | 0 |
Purchases | 0 |
Issues | 0 |
Sales | 0 |
Transfers Out | (17,784) |
Closing Balance | 0 |
Unrealized gains (losses) for Level 3 liabilities outstanding at end of the period | $ 0 |
Related Parties (Details)
Related Parties (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Related Party Transactions [Abstract] | ||
Due to affiliates | $ 0 | $ 0 |
Loan Facilities - Additional In
Loan Facilities - Additional Information (Detail) - USD ($) $ in Thousands | Apr. 30, 2019 | Apr. 12, 2019 | Oct. 12, 2017 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Apr. 13, 2019 |
Line of Credit Facility [Line Items] | |||||||
Proceeds from secured term loan, net | $ 0 | $ 48,248 | $ 0 | ||||
Long-term credit facility | 326,875 | 365,625 | |||||
Deferred financing costs | 4,020 | 5,257 | |||||
Debt, discount | 1,809 | 2,365 | |||||
Secured debt | Term loan | |||||||
Line of Credit Facility [Line Items] | |||||||
Annual principal payments | 18,100 | ||||||
Recapitalization credit agreement | Secured debt | |||||||
Line of Credit Facility [Line Items] | |||||||
Incremental expense related to the amortization of debt issuance costs | $ 1,800 | $ 1,900 | |||||
Recapitalization credit agreement | Secured debt | United States | |||||||
Line of Credit Facility [Line Items] | |||||||
Collateral percentage, capital stock of subsidiary | 100.00% | ||||||
Recapitalization credit agreement | Secured debt | Non-US | |||||||
Line of Credit Facility [Line Items] | |||||||
Collateral percentage, capital stock of subsidiary | 65.00% | ||||||
Recapitalization credit agreement | Secured debt | Term loan | |||||||
Line of Credit Facility [Line Items] | |||||||
Period of time required before year end to make annual prepayments of principal | 90 days | ||||||
Annual prepayment of principal, percentage amount of annual excess cash flow | 50.00% | ||||||
Term Loan Facility | Secured debt | Term loan | |||||||
Line of Credit Facility [Line Items] | |||||||
Face amount of debt | $ 350,000 | ||||||
Debt term | 5 years | ||||||
Long-term debt, weighted average interest rate, over time | 5.70% | ||||||
Debt instrument, annual principal payment | $ 38,800 | ||||||
Annual principal payments | $ 8,800 | ||||||
Term Loan Facility | Secured debt | Term loan | Minimum | |||||||
Line of Credit Facility [Line Items] | |||||||
Weighted average interest rate | 5.00% | ||||||
Term Loan Facility | Secured debt | Term loan | Maximum | |||||||
Line of Credit Facility [Line Items] | |||||||
Weighted average interest rate | 6.60% | ||||||
Revolving Loan Facility | Secured debt | Revolving credit facility | |||||||
Line of Credit Facility [Line Items] | |||||||
Face amount of debt | $ 20,000 | ||||||
Debt term | 3 years | ||||||
Proceeds from Lines of Credit | $ 0 | $ 0 | $ 0 | ||||
New TLB | Secured debt | |||||||
Line of Credit Facility [Line Items] | |||||||
Debt, discount | $ 9,000 | ||||||
New TLB | Secured debt | Base rate | |||||||
Line of Credit Facility [Line Items] | |||||||
Spread on interest rate | 2.25% | ||||||
New TLB | Secured debt | Term loan | |||||||
Line of Credit Facility [Line Items] | |||||||
Face amount of debt | $ 375,000 | ||||||
Debt term | 5 years | ||||||
Repayments of lines of credit | $ 319,400 | ||||||
Proceeds from secured term loan, net | 48,200 | ||||||
Long-term debt, weighted average interest rate, over time | 3.80% | ||||||
Debt instrument, periodic payment, principal | 4,700 | ||||||
Debt instrument, annual principal payment | 18,800 | ||||||
Incurred fees | 5,700 | ||||||
Deferred financing costs | 2,700 | $ 1,800 | |||||
Write off of deferred debt issuance cost | $ 3,000 | $ 4,800 | |||||
Annual principal payments | $ 9,400 | ||||||
New TLB | Secured debt | Term loan | Minimum | |||||||
Line of Credit Facility [Line Items] | |||||||
Weighted average interest rate | 3.40% | ||||||
New TLB | Secured debt | Term loan | Maximum | |||||||
Line of Credit Facility [Line Items] | |||||||
Weighted average interest rate | 5.00% | ||||||
New TLB | Secured debt | Term loan | LIBOR | |||||||
Line of Credit Facility [Line Items] | |||||||
Spread on interest rate | 3.25% | ||||||
Reduction from the applicable borrowing rates, percentage | 0.50% |
Loan Facilities - Schedule of D
Loan Facilities - Schedule of Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Debt Disclosure [Abstract] | ||
Term Loan Facility carrying value | $ 321,046 | $ 358,003 |
Unamortized discount | 1,809 | 2,365 |
Unamortized debt issuance costs | 4,020 | 5,257 |
Total Term Loan Facility | 326,875 | 365,625 |
Current maturities of Term Loan Facility | 0 | (18,750) |
Total long-term debt | $ 326,875 | $ 346,875 |
Equity (Details)
Equity (Details) - USD ($) $ / shares in Units, $ in Thousands | Feb. 03, 2021 | Apr. 01, 2015 | Apr. 30, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2020 |
Equity, Class of Treasury Stock [Line Items] | |||||||
Cost of repurchased common stock | $ 23,257 | $ 69,439 | $ 195,299 | ||||
Dividends declared per common share (in usd per share) | $ 0.20 | $ 0.20 | $ 0.20 | ||||
Dividend equivalents paid on outstanding restricted stock units | $ 1,100 | $ 1,300 | $ 1,100 | ||||
Subsequent event | |||||||
Equity, Class of Treasury Stock [Line Items] | |||||||
Dividends declared per common share (in usd per share) | $ 0.05 | ||||||
Restricted stock units | |||||||
Equity, Class of Treasury Stock [Line Items] | |||||||
Restricted stock units vested and issued as common stock (in shares) | 1,863,885 | 1,407,095 | |||||
Repurchased shares for award (in shares) | 764,529 | 573,472 | |||||
Average repurchase price of shares for award (in usd per share) | $ 19.42 | $ 24.37 | |||||
Treasury stock, value, acquired, cost method | $ 14,800 | $ 14,000 | |||||
Cogent Partners, LP | |||||||
Equity, Class of Treasury Stock [Line Items] | |||||||
Common stock issued on acquisition date (in shares) | 779,454 | ||||||
Possible contingent consideration (in shares) | 334,048 | ||||||
Fair value of contingent common shares | $ 11,900 | ||||||
Cogent Partners, LP | Additional paid-in capital | |||||||
Equity, Class of Treasury Stock [Line Items] | |||||||
Adjustments to additional paid-in capital | $ 1,200 | ||||||
Common stock | |||||||
Equity, Class of Treasury Stock [Line Items] | |||||||
Repurchased common stock (in shares) | 489,704 | 3,275,641 | 7,497,635 | ||||
Average repurchase price of common stock (in usd per share) | $ 17.18 | $ 16.93 | $ 24.89 | ||||
Cost of repurchased common stock | $ 8,400 | $ 55,500 | $ 186,600 | ||||
Share repurchase program, September 2017 | Common stock | |||||||
Equity, Class of Treasury Stock [Line Items] | |||||||
Repurchased common stock (in shares) | 15,040,528 | ||||||
Cost of repurchased common stock | $ 316,300 | ||||||
Fees and expenses related to tender offer | $ 200 |
Earnings per Share - Reconcilia
Earnings per Share - Reconciliation (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |||
Numerator for basic and diluted EPS — net income | $ 31,334 | $ 10,978 | $ 39,222 |
Denominator for basic EPS — weighted average number of shares (in shares) | 18,939,210 | 24,024,674 | 26,813,285 |
Add — dilutive effect of: | |||
Restricted stock units | 4,139,000 | 247,000 | 825,000 |
Denominator for diluted EPS — weighted average number of shares and dilutive potential shares (in shares) | 23,078,451 | 24,272,479 | 27,637,720 |
Earnings per share: | |||
Basic (in usd per share) | $ 1.65 | $ 0.46 | $ 1.46 |
Diluted (in usd per share) | $ 1.36 | $ 0.45 | $ 1.42 |
Earnings per Share - Additional
Earnings per Share - Additional Information (Details) - shares | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Earnings Per Share Disclosure [Line Items] | |||
Antidilutive securities (in shares) | 0 | 1,480,056 | 672,518 |
Cogent Partners, LP | |||
Earnings Per Share Disclosure [Line Items] | |||
Incremental common shares attributable to dilutive effect of contingently issuable shares (in shares) | 334,048 |
Retirement Plan (Details)
Retirement Plan (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Retirement Benefits [Abstract] | |||
Incurred costs for contributions to retirement plan | $ 1.3 | $ 1 | $ 1.3 |
Contributions due to Retirement Plan included in compensation payable | $ 0.1 | $ 0.1 |
Deferred Compensation - Additio
Deferred Compensation - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share Based Payments Disclosure [Line Items] | |||
Description of vesting term for awards granted | Awards granted under the plan are generally amortized ratably over a three to five-year service period following the date of the grant. | ||
Deferred compensation payable | $ 10 | $ 14.5 | |
Unrecognized deferred cash compensation (prior to the consideration of forfeitures) | $ 5.5 | ||
Deferred compensation arrangement with individual, maximum contractual term | 1 year 4 months 24 days | ||
Compensation expense from deferred compensation | $ 7.2 | 8.9 | $ 7.7 |
Minimum | |||
Share Based Payments Disclosure [Line Items] | |||
Service period for deferred compensation payable | 3 years | ||
Maximum | |||
Share Based Payments Disclosure [Line Items] | |||
Service period for deferred compensation payable | 5 years | ||
Restricted stock units | |||
Share Based Payments Disclosure [Line Items] | |||
Compensation expense from the vesting of restricted stock units | $ 31.8 | $ 45.8 | $ 38.4 |
Weighted average grant date fair value for restricted stock units granted (in usd per share) | $ 8.82 | $ 22.55 | $ 18.94 |
Unrecognized restricted stock units compensation expense | $ 42.2 | ||
Unrecognized restricted stock units compensation expense, weighted average recognition period | 1 year 7 months 6 days | ||
Restricted stock units | Minimum | |||
Share Based Payments Disclosure [Line Items] | |||
Stock units granted, ratable vesting period | 3 years | ||
Restricted stock units | Maximum | |||
Share Based Payments Disclosure [Line Items] | |||
Stock units granted, ratable vesting period | 5 years |
Deferred Compensation - Activit
Deferred Compensation - Activity (Detail) - Restricted stock units - $ / shares | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Units | |||
Outstanding, beginning of period (in shares) | 6,781,475 | 6,210,282 | |
Granted (in shares) | 3,921,260 | 2,294,967 | |
Delivered (in shares) | (1,895,249) | (1,468,700) | |
Forfeited (in shares) | (1,220,408) | (255,074) | |
Outstanding, end of period (in shares) | 7,587,078 | 6,781,475 | 6,210,282 |
Grant Date Weighted Average Fair Value | |||
Outstanding, beginning of period (in usd per share) | $ 21.60 | $ 22.73 | |
Granted (in usd per share) | 8.82 | 22.55 | $ 18.94 |
Delivered (in usd per share) | 26.44 | 27.58 | |
Forfeited (in usd per share) | 15.72 | 22.84 | |
Outstanding, end of period (in usd per share) | $ 14.68 | $ 21.60 | $ 22.73 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) - Letter of Credit | 12 Months Ended | |
Dec. 31, 2020USD ($)CreditFacility | Dec. 31, 2019USD ($)CreditFacility | |
Commitments and Contingencies Disclosure [Line Items] | ||
Number of letters of credit issued to secure office space leases (credit facility) | CreditFacility | 4 | 6 |
Amount outstanding on letters of credit | $ 7,200,000 | $ 9,800,000 |
Proceeds from lines of credit | $ 0 | $ 0 |
Income Taxes - Provision for In
Income Taxes - Provision for Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Current taxes: | |||
U.S. federal | $ (2,794) | $ 2,868 | $ 1,868 |
State and local | (306) | 410 | 1,937 |
Foreign | 11,535 | 4,982 | 9,968 |
Total current tax expense | 8,435 | 8,260 | 13,773 |
Deferred taxes: | |||
U.S. federal | 1,245 | 293 | 202 |
State and local | 264 | (534) | 50 |
Foreign | (1,517) | (574) | 5,183 |
Total deferred tax (benefit) expense | (8) | (815) | 5,435 |
Total tax expense | $ 8,427 | $ 7,445 | $ 19,208 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
Operating loss carryforwards | $ 36.5 | ||
Operating loss carryforwards, carried back to prior years taxable income | $ 19.6 | ||
Carryforward period | 5 years | ||
Deferred tax assets, capital loss carryforwards, not subject to expiration | $ 2.1 | ||
Deferred tax assets, capital loss carryforwards, subject to expiration | $ 0.2 | ||
Deferred tax assets, capital loss carryforwards, subject to expiration, period | 5 years | ||
U.S. statutory tax rate | 21.00% | 21.00% | 21.00% |
Income Taxes - Net Deferred Tax
Income Taxes - Net Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred tax assets: | ||
Compensation and benefits | $ 18,261 | $ 21,706 |
Depreciation and amortization | 642 | 1,816 |
Cumulative translation adjustment | 10,079 | 12,235 |
Operating loss carryforwards | 11,736 | 4,644 |
Capital loss carryforwards | 2,298 | 1,874 |
Lease asset | 23,867 | 7,652 |
Other financial accruals | 448 | 3,760 |
Valuation allowances | (2,298) | (2,409) |
Total deferred tax assets | 65,033 | 51,278 |
Deferred tax liabilities: | ||
Lease liability | 19,139 | 6,959 |
Other financial accruals | 6,934 | 5,045 |
Total deferred tax liabilities | 26,073 | 12,004 |
Net deferred tax asset | $ 38,960 | $ 39,274 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Statutory U.S. Federal Income Tax Rate to Company's Effective Income Tax Rate (Details) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
U.S. statutory tax rate | 21.00% | 21.00% | 21.00% |
Increase related to state and local taxes, net of U.S. income tax benefit | (3.00%) | (0.50%) | 2.60% |
Benefits and taxes related to foreign operations | (7.30%) | 8.80% | (1.50%) |
Charge related to Global Intangible Low-Taxed Income | 0.00% | 2.00% | 1.30% |
RSU vesting and dividend discrete accounting charge or benefit | 13.30% | 6.30% | 8.00% |
Charge related to non-deductible compensation | 2.40% | 3.30% | 1.80% |
Tax Benefits Related to CARES Act | (4.60%) | 0.00% | 0.00% |
Other | (0.60%) | (0.50%) | (0.30%) |
Effective income tax rate | 21.20% | 40.40% | 32.90% |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Lessee, Lease, Description [Line Items] | |||
Operating lease cost | $ 18.5 | $ 15.3 | $ 15 |
Free rent period, amount | $ 4.9 | ||
Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease, remaining lease term | 1 year | ||
Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease, remaining lease term | 15 years |
Leases - Operating Lease, Futur
Leases - Operating Lease, Future Rental Payments, Maturity (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Leases [Abstract] | ||
2021 | $ 11,671 | |
2022 | 11,190 | |
2023 | 10,171 | |
2024 | 9,329 | |
2025 | 8,756 | |
Thereafter | 76,875 | |
Total lease payments | 127,992 | |
Plus: tenant incentive utilized to finance leasehold improvements | 11,302 | |
Less: Interest | (44,197) | |
Present value of operating lease liabilities for which the Company has a right-of-use asset and corresponding liability | $ 95,097 | $ 30,750 |
Leases - Weighted Average Remai
Leases - Weighted Average Remaining Lease Term and Weighted Average Discount Rate (Details) | Dec. 31, 2020 | Dec. 31, 2019 |
Leases [Abstract] | ||
Weighted average remaining lease term in years, including the lease for which the right to use has not commenced | 12 years 8 months 12 days | 12 years 1 month 6 days |
Weighted average discount rate | 6.80% | 5.80% |
Regulatory - Additional Informa
Regulatory - Additional Information (Detail) | 12 Months Ended | |
Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Broker-Dealer, Net Capital Requirement, SEC Regulation [Abstract] | ||
Description of minimum net capital requirements | The greater of $5,000 or 1/15 of aggregate indebtedness | |
Minimum net capital requirements (greater than $5,000 or 1/15 of aggregate indebtedness) | $ 5,000 | |
Minimum net capital requirements (greater than $5,000 or 1/15 of aggregate indebtedness) | 6.67% | |
Net capital | $ 17,300,000 | $ 24,500,000 |
Excess net capital | $ 14,700,000 | $ 23,200,000 |
Aggregate indebtedness to net capital ratio | 2.2 | 0.8 |
Business Information - Addition
Business Information - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
United States | |||
Segment Reporting Information [Line Items] | |||
Long-lived assets | $ 29.4 | $ 22.8 | |
Revenue | Customer Concentration Risk | One client | |||
Segment Reporting Information [Line Items] | |||
Percentage of revenue | 14.00% | 11.00% | |
Revenue | Geographic Concentration Risk | United States | |||
Segment Reporting Information [Line Items] | |||
Percentage of revenue | 52.00% | 67.00% | 52.00% |
Revenue | Geographic Concentration Risk | United Kingdom | |||
Segment Reporting Information [Line Items] | |||
Percentage of revenue | 36.00% | 12.00% | 29.00% |
Business Information - Informat
Business Information - Information by Geographic Region, After Elimination of All Significant Inter-company Accounts and Transactions (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Segment Reporting Information [Line Items] | |||
Revenues | $ 311,678 | $ 301,012 | $ 351,985 |
Operating income (loss) | 55,248 | 45,843 | 80,868 |
Total assets | 585,799 | 494,375 | 485,700 |
North America | |||
Segment Reporting Information [Line Items] | |||
Revenues | 167,038 | 212,916 | 193,707 |
Operating income (loss) | (5,238) | 38,116 | 16,472 |
Total assets | 297,579 | 196,603 | 198,313 |
Europe | |||
Segment Reporting Information [Line Items] | |||
Revenues | 127,631 | 46,827 | 125,149 |
Operating income (loss) | 62,603 | (9,964) | 57,736 |
Total assets | 138,632 | 129,725 | 152,478 |
Rest of World | |||
Segment Reporting Information [Line Items] | |||
Revenues | 17,009 | 41,269 | 33,129 |
Operating income (loss) | (2,117) | 17,691 | 6,660 |
Total assets | $ 149,588 | $ 168,047 | $ 134,909 |
Subsequent Events (Details)
Subsequent Events (Details) - $ / shares | Feb. 03, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Subsequent Event [Line Items] | ||||
Dividends declared per common share (in usd per share) | $ 0.20 | $ 0.20 | $ 0.20 | |
Subsequent event | ||||
Subsequent Event [Line Items] | ||||
Dividends declared per common share (in usd per share) | $ 0.05 |