We exited, as you can tell, exited a significant amount of people to keep our headcount within a 3% or 4% range while we did this. And it goes — it’s an investment that by accounting reasons in our business goes through your comp ratio and your earnings. Does it matter? Sure. Was it extremely difficult decision for us to take this — decisions to do this? Yeah, you can imagine there was the debate on this, is significant. Do I think that it will pay back, extremely well over time and always has in every past cycle? You can’t create these franchises when you want to, you have to create them when you can.
Ken Worthington: Okay, fair enough. And then just maybe moving to the balance sheet, we don’t have the queue yet. So talk about the cash balance given the dividend and the compensation accrual. Do you guys think you’ll have to draw down on the revolver? Or is there enough cash to kind of meet the dividend in the year-end bonus payouts?
Joe Simon: Yeah, we obviously are pretty attentive to that area. We do not expect to, to have to draw on the line, we expect to have adequate cash to service the dividend as well as the compensation at the end of the year.
Ken Worthington: Okay, great. Thank you very much.
Operator: Your next question comes from James Yaro with Goldman Sachs. James, your line is open.
James Yaro: Good afternoon, and thanks for taking my questions. I take your point on the strong restructuring this quarter not repeating but how is the challenging macro backdrop affecting the medium-term trajectory for restructuring?
Ken Moelis: We had a really good restructuring quarter. And by the way, we have a really good restructuring business going forward as well. It was outsized, even for us for this quarter. But it’s at the top end of its range, our backlog on restructuring is very good. And then I feel very good about it going forward, because our out of court expertise is something that most people want. Most of the deals that have been done in the last few years have been capitalized with a significant larger amount of equity than in prior downturns. So, the route to — for most of these transactions is not straight into bankruptcy, it is to do capital markets to extend runway and liquidity, which we beefed up our capital markets for that and liability management exercises to create room.
And I think the fact that most of the transactions have so much equity under the debt capital, gives you the ability to do innovative solutions without going to court. So yeah, I’d say I think the restructuring business will continue. There are a lot of firms that will continue to have trouble with higher rates, but they do have options and flexibility to address them.
James Yaro: Okay, that’s very clear. Maybe we can just turn to your hiring plans, I guess should we expect you to continue to hire at an elevated pace into next year? I’d imagine it obviously won’t be at the level you’ve been hiring at, especially earlier in this year. But will it remain elevated into next year?
Ken Moelis: I don’t think nothing like as we’ve gotten — look, these were a couple of the large sectors, we wanted to address technology, again, was over half of the Managing Directors. We established an Energy Transition Team, which is, as a result of the IRA just became a market that we wanted to be in. And wanted to be in significantly and found a great team there. The Credit Suisse debacle, freed up some exceptional talent in industrials. And so we took advantage of that. And prior to that we had been very aggressive in healthcare going back 12 months ago. So, I think we’ve done a very good job in the sectors that we really wanted to turn the firm to address coming to the next M&A cycle. There’s, no I’m not going to say which one, but there is one more sector that we’re kind of looking at. But there’ll be nothing of the magnitude of this, we think we put in place a significant amount of the talent that we have to address the markets.
