Evercore Financial Performance and Governance
U.S. GAAP Reconciliation to Adjusted Results (Unaudited)
Information in the following financial reconciliations presents the historical results of the Company and is presented on an Adjusted basis, which is a non-generally accepted
accounting principles ("non-GAAP") measure. Adjusted results begin with information prepared in accordance with accounting principles generally accepted in the United States
of America ("U.S. GAAP"), adjusted to exclude certain items and reflect the conversion of certain Evercore LP Units and other IPO related restricted stock unit awards, as well as
Acquisition Related Share Issuances and Unvested Restricted Stock Units, into Class A shares. Evercore believes that the disclosed Adjusted measures and any adjustments
thereto, when presented in conjunction with comparable U.S. GAAP measures, are useful to investors to compare Evercore's results across several periods and facilitate an
understanding of Evercore's operating results. The Company uses these measures to evaluate its operating performance, as well as the performance of individual employees.
These measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with U.S. GAAP. These Adjusted amounts
are allocated to the Company's two business segments: Investment Banking & Equities and Investment Management. The differences between Adjusted and U.S. GAAP results
are as follows:
Assumed Vesting of Evercore LP Units and Exchange into Class A Shares. In prior periods, the Company incurred expenses, primarily in Employee Compensation and Benefits,
resulting from the vesting of Class E LP Units issued in conjunction with the acquisition of ISI, as well as Class J LP Units. The Adjusted results assume substantially all of these
LP Units have vested and have been exchanged for Class A shares. Accordingly, any expense or reversal of expense associated with these units, and related awards, is
excluded from Adjusted results, and the noncontrolling interest related to these units is converted to controlling interest. The Company's Management believes that it is useful to
provide the per-share effect associated with the assumed conversion of these previously granted equity interests and IPO related restricted stock units, and thus the Adjusted
results reflect their exchange into Class A shares.
Adjustments Associated with Business Combinations and Divestitures. The following charges resulting from business combinations and divestitures have been excluded from
the Adjusted results because the Company's Management believes that operating performance is more comparable across periods excluding the effects of these acquisition-
related charges:
Amortization of Intangible Assets and Other Purchase Accounting-related Amortization.
amortization from the acquisition of ISI, SFS and certain other acquisitions.
Amortization of intangible assets and other purchase accounting-related
GP Investments. Write-off of General Partnership investment balances during the fourth quarter of 2013 associated with the acquisition of Protego.
Acquisition and Transition Costs. Primarily professional fees incurred and costs related to transitioning acquisitions or divestitures.
Fair Value of Contingent Consideration. The expense, or reversal of expense, associated with changes in fair value of contingent consideration issued to the sellers of
certain of the Company's acquisitions.
Gain on Transfer of Ownership of Mexican Private Equity Business. The gain resulting from the transfer of ownership of the Mexican Private Equity business in the third
quarter of 2016.
Gain on Sale of Institutional Trust and Independent Fiduciary business of ETC. The gain resulting from the sale of the Institutional Trust and Independent Fiduciary
business of ETC in the fourth quarter of 2017.
Foreign Exchange Gains / (Losses). Release of cumulative foreign exchange losses resulting from the restructuring of our former equity method investment in G5 in the
fourth quarter of 2017, as well as from the sale and wind-down of our businesses in Mexico in the fourth quarter of 2020.
Net Loss on Sale of ECB businesses. The net loss resulting from the gain on the sale of the ECB Trust business and the loss on the sale of the remaining ECB business
incurred in the third and fourth quarters of 2020, respectively.
Gain on Redemption of G5 Debt Security. The gain on the redemption of the G5 debt security in the second quarter of 2021 is excluded from the Adjusted presentation.
EVERCORE
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