Houlihan Lokey, Inc. (NYSE:HLI) Q2 2024 Earnings Call Transcript

Scott Beiser: I’d say, two things. One, it doesn’t necessarily make a lot of logical sense to us in why there’s been a bit of a slowdown in restructuring new activity in the US because we think the macro factors impacting it are still there. Nothing has hugely changed. On the capital market improvement side, you start with the worst of all fact patterns, for Corporate Finance is when their capital markets are not open. As we’ve described, we do think they’re open now, but it’s not necessarily hugely helpful to restructuring or I should say, hugely doesn’t cause restructuring business to go down, because while the capital markets are more open and continue to open more you still just have a higher interest rate than what people would be refinancing at.

So, I don’t see, I’ll call it, what we would expect is normalization for the — while in the capital markets, as being a detriment to the restructuring environment because of where interest rates are. You have a different conclusion if you somehow thought the Feds were going to bring interest rates down substantially and close to where they were two years ago, which is not what anybody is expecting, but if that were to happen, we’d have a different tone and view on restructuring.

Brendan O’Brien: Got it. That makes sense. Thank you for taking my questions.

Operator: Thank you. [Operator Instructions] This concludes today’s question-and-answer session. I would like to turn the floor back over to Scott Beiser for closing comments.

Scott Beiser: I want to thank you all for participating in our second quarter fiscal year 2024 earnings call, and we look forward to updating everyone on our progress when we discuss our third quarter results for fiscal 2024 this coming winter.

Operator: Thank you. This concludes today’s teleconference. You may disconnect your lines at this time. Thank you for your participation.