Good morning, ladies and gentlemen. Thank you for standing by. Welcome to the Evercore Fourth Quarter and full Year 2016 Financial Results Conference Call. During today's presentation, all parties will be in listen-only mode. Following the presentation, the conference call will be open for questions. [Operator Instructions] This conference call is being recorded today, Wednesday, February 1, 2017. I would now like to turn the conference call over to your host, Evercore's Chief Financial Officer, Bob Walsh. Please go ahead, sir.

Good morning and thank you for joining us today for Evercore's fourth quarter and full year 2016 financial results conference call. I'm Bob Walsh, Evercore's Chief Financial Officer. And joining me on the call today are Ralph Schlosstein, President and Chief Executive Officer, our New Executive Chairman, John Weinberg, and Roger Altman, our Founder and Senior Chairman. After our prepared remarks, we will open up the call for questions. Earlier today, we issued a press release announcing Evercore's fourth quarter and full year 2016 financial results. The company's discussion of our results today is complementary to that press release, which is available on our website at evercore.com. This conference call is being webcast live on the Investor Relations section of the website, and an archive of it will be available beginning approximately one hour after the conclusion of this call for 30 days. I want to point out that during the course of this conference call, we may make a number of forward-looking statements. These forward-looking statements are subject to various risks and uncertainties, and there are important factors that could cause actual outcomes to differ materially from those included in these statements. These factors include, but are not limited to, those discussed in Evercore's filings with the Securities and Exchange Commission, including our annual report on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K. I want to remind you that the company assumes no duty to update any forward-looking statements. In our presentation today, unless otherwise indicated, we will be discussing adjusted financial measures, which are non-GAAP measures that we believe are meaningful when evaluating the company's performance. For detailed disclosures on these measures and to their GAAP reconciliation, you should refer to the financial data contained within our press release, which, as previously mentioned, is posted on our website. We continue to believe that it is important to evaluate Evercore's performance on an annual basis. As we've noted previously, our results for any particular quarter are influenced by the timing of transaction closing. I'll now turn the call over to Ralph.

Thanks very much Bob and good morning, everyone. Before we discuss the results for the quarter and full year, Roger and I would like to welcome John Weinberg, our New Executive Chairman to this call. John’s arrival at Evercore is a giant step forward for the firm. His skill as a banker and his integrity exemplify the high caliber senior banking professionals who we continue to attract to Evercore to elevate, evolve and grow our business. All three of us will be on today’s call. In the future you should expect, in most cases to have John and me. Roger will be spending the vast majority of his Evercore time with clients, which with all due respect to all of you is his passion. Let me now talk about the year and the quarter. 2016 was a remarkably strong year for Evercore, driven by industry leading growth in every part of our advisory business. Advisory revenues grew 27% versus last year. Our equities business continued to grow modestly and was again very highly rated in the institutional investor rankings, number two, on a weighted basis and number three, on an unweighted basis. Our Investment Management business continued to perform as expected. Our growth in advisory was driven by market share gains, not by a particularly a brilliant M&A environment. As you all are aware, we track our market share versus public firms which report their advisory fees separately and all publicly traded independent firms. Versus all public firms including all the large universal banking firms, our market share of revenues was 4.8% at the end of 2015. While all firms have not yet reported, we estimate that our market share for 2016 among all public firms will be 6% or perhaps a little higher. We estimate that our market share…

I’ll try to be quick here because; I don’t want to duplicate what Ralph just said. For the banking side of the firm, 2016 was the eight consecutive record year. I’m going to focus first on the year and then on the quarter though this is covering the year. Total revenue hit 1.35 billion that was up 21% from the 2015 levels. Pre-tax income 345 million, up 32% from the 2015 figure. To break down that revenue, advisory fees totaled 1.07 billion, up 27%. Commission and related income was 231 million, up 1.5%, underwriting revenue 36 million, down 9.6%. Breaking down the advisory fee portion of that further, we saw 246 fees equal to or greater than 1 million each, that’s up from a 180 for 2015, which represents a 37% increase. And we advised on 86 capital raising transactions last year, generating fees of 73 million in comparison to 63 transactions in 2015. The total number of fee paying clients for 2016 was 568, another record, up from 484 the year earlier. On productivity, revenue per senior managing director on the same rolling 12 months basis we always use was 13.8 million globally at the end of 2016, up 9% versus the end of year 2015 figure. The ’16 number I just gave you reflects 70 senior managing directors, the 2015 figure reflected 68. Now we pay a lot of attention to productivity because we think it’s really an important measure of how we’re doing. And by any normal standard in this business, 13.8 million for a senior management director is a very strong figure. Our comp ratio of 57.8 for 2016 versus 58.2 improved obviously, and our operating 26.3 up from 24.1. We realized 33% of our advisory fees from non-US sources in 2016, which represents good balance.…

This is my first call, and first let me say that it’s a real privilege to be here with you. Consistent with the view at Evercore since the very beginning, managing, retaining and recruiting talent is foremost, and so I’m going to spend just a couple of minutes talking about talent and then I’m going to move on and spend a couple of minutes on the M&A markets and our view going forward. Consistent with our long standing commitment to steady growth in adding talent, we have added five advisory senior managing directors in 2016, adding to our industry expertise in energy and industrials and expanding our capabilities and activism in defense and broadening our geographic reach in Europe. We ended 2015 with 81 advisory Senior Managing Director. To date in 2017, we’ve announced the addition of Masuo Fukuda in Tokyo strengthening our position in Japan, where we continue to work with our long standing partner Mizuho, and also we’ve added [Eier] Wilson further solidifying our capabilities in the industrial sector. Importantly, we continue to be focused on growing and developing our internal talents. With that we are pleased to announce that at the beginning of this year, we promoted four advisory managing directors to senior managing director, adding to our leadership teams in healthcare, media, technology and in capital advisory for alternative investment funds. We’ve a number of active discussions in the process currently, and it is really too early to tell the altered number of SMDs that we’ll be adding in 2017, but we are optimistic that this could be a strong year. Now let me transfer a few minutes to the M&A market. The M&A market remains healthy, while aggregate dollar volume of a known M&A transaction was down from record level seen in 2017. In 2016,…

Okay, let me just talk briefly about our equities business. Thanks John. Equities performed well again this year with modest in secondary revenues offsetting a modest decreased in equity capital market activity. As all of you most certainly know, it was in the challenging year in the ECM market and we were not excluded from that. Our ECM revenues were down approximately 10% year-over-year. In comparison, however, to our large firm competitors who generally were down 20% to 35%. We continue to execute our strategy, participating as a book runner in the two largest IPOs in the US in 2016 and as an independent advisor on the largest IPO in the UK last year. We remain confident in our ECM strategy and look forward to stronger results in 2017. Evercore ISI contributed net revenues of 68.7 million in the quarter, including 5.7 million attributable to ECM activities. But the year of the business reported net revenues 246.2 million including 15.7 million attributed to underwriting. Full year secondary revenues were up 2% versus last year, driven by a 12% increase in trading volumes, demonstrating the success of our low touch trading platform. Overall, the business produced operating margins of 24% in the quarter and 22% for the full year. The business continues to perform well in a challenging market and we remain confident that we can grow this business as we federally add high quality talents. In investment management, we reported net revenues and operating income of $18.8 million and $8 million for the quarter. For the full year, net revenues were 80.8 million and operating income was 24.3 million. The full year operating margin was 30% compared to 24% last year. These results predominantly reflect the contribution from our Wealth Management and Trust businesses in the US and the Money Market Investment Management business in Mexico, each of which continue to perform well. During the year, we also continued to make progress in rationalizing our investment management portfolio of businesses, selling our Mexican Private Equity business to the professionals who manage that business. Bob will now provide further comments on our GAAP results, as well as on our non-compensation cost and several other financial matters. Bob?

Starting with our GAAP results, net revenues on a GAAP basis of 445 million and 1.44 billion were a record for a fourth quarter and full year respectively just as they were a record on an adjusted basis. Net income attributable to Evercore Partners Inc. was 43.4 million for the quarter and 107.5 million for the year, a record for each period on a GAAP basis. Consistent with prior periods, our adjusted results exclude certain items that are directly related to our acquisitions and dispositions, particularly costs related to our equities business. Most significantly, we adjust for cost associated with divesting of LT units and interest granted in conjunction with the ISI acquisition. For the year we expense 80.4 million related to this equity in comparison with 82.5 million in 2015. As a reminder, our adjusted presentation includes all of the shares we expect to issue for the equities business in the EPS denominator. Our forecast that drive the number of shares expected to be issued did not change in the quarter. Turning to non-compensation costs, firm-wide operating cost per employee were 152,000 for the year, a 3% decline versus 2015 as growth in non-compensation costs were lower than the overall growth in headcounts. For the quarter, such costs were [39.5,000], up slightly on a sequential basis. The adjusted operating margins, which govern the ultimate pay-out of G&H unit for the equities business are 14.3% for the year, above the threshold for the current year from the G units. Moving to Atalanta Sosnoff, at the end of 2016 Martin Sosnoff from that business, concurrently re-performed an assessment of the carrying value of our investment for impairment and recognized a pre-tax impairment charge of $8.1 million, 3.8 million after tax in our US GAAP results for the fourth quarter. Moving to…

That completes our presentation. Let’s just take questions.

[Operator Instructions] our first question is from the line of Steven Chubak with Nomura. Your line is open.

Ralp, you recently announced the decision to open up an office in Tokyo and the hiring of Masuo Fukuda. In recent years we’ve actually seen a number of your bulge bracket competitors chose to retrench from some of those markets just given very intense competition. Really struggle as to competing with some of the local players, and want to take (inaudible) towards driving your decision to expand to Tokyo, whether you believe that the retrenchment of some of the more global players has provided better opportunity. And are there other markets where you might look to expand in the coming years?

Well first of all, this is not a major material event from a financial point of view. We’ve had a partnership with Masuo. We do feel that particularly outbound M&A from Japan will continue. We have a lot of cash rich companies with a life locked in to an essentially no growth local economy. So the impetus for them diversifying outside of their home country is very real. So we felt that having a very modest, and this is probably going to be three people or so, Evercore branded effort on the ground would help us in two ways, first, to be more involved in some of that outbound flow. And second because of the acquisition appetite of Japanese companies very often sell sides in the US or Europe have one or more potential buyers in Japan and so we felt our ability to access those not only through Masuo but through an Evercore branded effort would be useful. We do that more in response to the availability of great talent than a strategy of we have to be here or there or anywhere. We’ve never said that and we never will.

And, first up John welcome and appreciated your helpful commentary as it relates to the outlet of 2017. In the prepared remarks you did note that the ingredients for a constructive backdrop were still very much in place. And as I think over the last couple of years, the message from a lot of C level management at the very M&A shops has broadly been that low rates and a slower pace of growth actually provided a pretty favorable backdrop. And now as we look ahead under the new presidency, you have expectations for more inflationary policies that could spur accelerated growth, but also drive rate and ultimately financing cost higher, and yet the messaging continues to be quiet constructive. And I’m just curious hear what in your view actually makes for their backdrop in terms of industry activity.

My own point of view is that so much of M&A activity is driven by CEO confidence, and what we’re seeing and hearing is that CEOs have confidence, they have confidence in a rising economy whether it’s a slow rising economy or more accelerated. But they really feel that, and they see that there are opportunities in financing and access to capital remains high and I think perceive that it will remain high. So those things together I think really do provide a very positive backdrop for people who are looking at strategies to be able to execute on them. And that’s why I think we believe that there is a very solid basis to believe that things will continue to be quite strong. Roger, I don’t know if you have a point of view on this.

I share that. I’ve said many times on this call or referred many times to the basic elements of or the framework that typically eventually tend to healthy M&A activity and John referred to them in his comments, I won’t go over them again. I just think they are in place and I expect 2017 to be a healthy year. And with our continuum to get market share, a year in which we again do well.

And maybe more specifically in terms of cross border activity, how you’re thinking about the potential impact of given some of the protectionist rhetoric that has come out recently, but at the same time we’ve also seen quite a bit of US dollar strengthening which could clearly give more purchasing power to US corporates.

I think we have to just wait and see on that. There are going to be a lot of cross currents this year given the arrival of a lot of new policies both or at least potentially in the United States and reaction to those policies elsewhere. Very hard to tell at the moment, I don’t have a particular view on that. I’ve learned over many years that trying to forecast exchange rates is harder than forecasting the weather. So we just don’t know.

And your next question is from the line of Mike Needham with Bank of America Merrill Lynch. Your line is open.

So first just a bare picture of question for John. What are you aspiration for Evercore and what are you going to be focused on in your first couple of years?

Well, when I came to Evercore in making the decision, I was really impressed by number one, the level of talent here, and also the values and the principles. And my own expectation and my desire is to really take a strategy which has been very successful and to help to drive it forward. There are definitely places where we could continue this strategy that we’ve had which is acquiring great talent, developing great talent, retaining great talent, and then focusing on clients and trying to really take a very disciplined approach and really understand their needs in trying to fulfill those needs, whether those lead to transaction or not they will lead to trade relationships that our franchise value that goes forward. And that really is what my focus will be which is to continue the great values and principles, to keep the strategy which is this intense, relentless to find clients and to try to build it out further. What Roger and Ralph have done is really to take the firm and really take it step by step to a more relevant and larger size and really just more of an activity, and I think that’s really what our goals are going to be is just to keep building that out.

And then I was just hoping that you guys could drill down on the impact from the elections. It sounds like the level of conversations with clients is healthy. I don’t know, maybe you can comment on like pre versus post-election, whether that level is higher or lower, any near term risk to your pipeline in deals getting completed on time and then eventually would you expect the healthy level of conversations to convert to mandates.

Well first of all, we are two weeks or so in to the new administration and it’s pretty hard to generalize as to what it means for our business over the medium and longer term. I would say so far the level of discussions or conversations or evaluations is up from the pre-election period not down, there’s obviously some anticipation we can all read in the press, lesser regulation including on competition policy. Whether that continues who knows. But for the moment I’d say it’s up and we’ll just have to see how that evolves.

Our next question comes from the line of Brennan Hawken with UBS. Your line is open.

You all made a comment in your opening remarks about being optimistic in the recruiting environment. Do you think that your traditional target for recruiting would hold based upon what you see in 2017 and how should we balance the potential for a less hostile regulatory environment amongst some of your larger competitors playing in to the mix and do you think that might impact the recruiting outlook in any way or may be the cost of recruiting?

Well, first of all, let me take the second question first. While there is, as you’ve heard me say in the past, there’s always some combination of push and pull that causes someone to leave another firm and most often a large firm but not always and come to Evercore. The push factors, the regulatory environments in which bankers have to work is pretty far down the list of things that cause people to leave. So I would not expect a more benign financial regulatory environment if one is forthcoming by the way to have much of any effect on the open mindedness of bankers to consider departing where they are and joining us. With respect to the first question, we’re really as John said a little early in the year to tell. We have had the two announcements that John alluded and we have a third person that we are quite far along in discussion and then there are a number of other discussions. But these are a little bit like the transactions that we work on. Until there is an announcement you don’t really know that you’re going to get something done with these people, because the people who we are recruiting generally are the most valued and the most treasured at the places that they are. So there is always an aggressive effort on the part of their current employer to keep them.

And then on the ISI and equities business I don’t think I heard it, and if I missed it, apologies. But where did the full year margin in the equities business ex underwriting the calculation used for the shares tied to the deals where did that shake out? I believe the full year ’15 for comparative purposes was 15.2.

It was 14.3 for the year Brennan which exceeded the threshold for the current trench of units.

And then, well I get the environment for equities is certainly difficult. It seems like you guys think that it’s going to improve or that the pressure temporary. So would love to hear your thoughts on that. And when you think about the margin opportunity using 2016 as a jumping off point, how much of it in that business would be tied to revenue opportunity versus further expense discipline and rationalization?

I think our operating assumptions are not that we have a cyclical weakness in equities, it’s more oriented towards that there are secular impacts on that business, some of which may modestly reverse. But the growth of passive investing the leveling off or even shrinkage of active equity assets and hedge fund asserts are all modest headwinds for that business, obviously offsetting that on the other side is the growth in the equity capital markets generally. I would also say that there is some pretty consequential regulatory changes initially in Europe in the [FTU] standards, which both the clients and the providers of equity research services are starting to prepare themselves for and those will also have an affect certainly in Europe on the wallet spend of equity managers. We do think that our business approach which interestingly enough is identical in our advisory business and in our equities business, which is to have the most elite business, the top talent. We do think that that approach offers the opportunity for us to gain market share. But if you look at the equities business over the long cycle, it is not a secular growth business unlike the advisory business which even though it’s cyclical has for the last 35-40 years been a secular growth business. And then in terms of how do we expect to make money? We continue to look at our cost. I think our non-comp cost that we’ve made will continue to make modest progress, but they’re really not going to be a source of additional margin. But we do need to continue to attract and retain the best talent, upgrade talent where that is the appropriate thing to do and also utilize our distribution resources as efficiently as possible and to make sure that they are matched up against where revenue opportunities are as well. Sorry about the long-winded answer, but it’s a business that’s really important strategically to what we’re doing here. But it definitely doesn’t have the same winded the that our advisory was a success.

That’s a really great color and nice to see you could sneak it at least one use of the word elite on the back of last quarter. So thanks a lot.

Maybe a long day on that score.

We’re going to miss Roger.

Though I have to warn all of you, you know. The show so to speak that Ralph and I have had here for the past few years has been one of balance between one theory which is why use 20 words if four can do, which might be mine. And another theory which is why use 20 words when 80 might do, which might be somebody else’s. So John Weinberg has a very heavy burden to carry.

And our next question comes from James Mitchell with Buckingham Research.

Maybe one for John, since you’re new to the firm and coming from a full service shop, how do you - when you look at the underwriting opportunity at Evercore how would look at that and see what kind of upside there is in growing the market share in underwriting.

I think there’s actually a great deal of opportunities, and that Evercore has a very strong reputation with respect to advice, very financier people who really know how to give really objective thoughts to strategic decision makers who may be thinking about equity. So from that score there is in place a group of people who actually can really bring the kind of quality that the issuers are looking for. The capability of actually distributing and helping to structure the securities and basically drive underwriting is there. And really what we actually are trying to work on now and really thinking through it, how do we create enough of memory. This has been a firm that has really made its bones and really made the majority of the fruits of its labor from giving advice on mergers and now we have this capability which were integrating in. So there are two aspects of it, one is the actual capability which I think we have, and the second is making sure that we have all of our bankers who are out there having hundreds and hundreds dialogs everyday with people who are making decisions on the capital raised and giving that advise and having ourselves see part of the group who were going to be put in to those capital raises. And we’re starting to make that progress. It’s all about I think mental memories. Having been in the firm where that was really a big part of the suite of products, you see how that takes place. And we’re just starting to really work hard in developing that. So to really to go back to your question, I think there’s a lot of potential and it’s all about us starting to learn how to do it in a very effective way.

And you don’t think that comes at the expense of giving the M&A assignment and that’s maybe what some of the bankers are worried about?

No, I don’t think that all. On the contrary, I think the more important strategic discussions you’re having with management teams, the stronger the relationship is. So actually I think that they’ll see it on themselves and that will be somewhat synergistic. And that’s kind of the way I’ve seen it. I mean I’ve actually seen it take place and I believe that’s the way it will be.

Maybe one, Bob as we think about buybacks, the stock obviously the whole group’s had a pretty good run. Do you think little differently about net buybacks versus may be a special dividend or a debt buyback, how do you we think about the point of capital? Your cash balances were up I think 22%-23% year-over-year going in to this year.

We don’t really see anything that’s going to change our principles Jim, which is the dividend which the Board decides, it’s always reviewed annually and its gone up every year. As we mentioned, the remainder of the excess cash is going to returned to shareholders through buybacks making sure we cover as there is (inaudible) for new hires as part of our bonus awards and continuing to make progress reducing the shares we are using for the ISI acquisition.

Our next question is from the line of Vincent Hung with Autonomous. Your line is open.

I was impressed by the year-over-year increase in the number client transactions. Can you give me any sense to how much of that is from new versus so called repeat clients?

We don’t have data on that.

And is there anything you can say in regards to the ECM pipeline right now?

Entering this year and I’d say this is pretty standard across the board, it looks stronger than it did entering the last year. And that’s an industry wide commentary and Evercore is not an exception from that.

Our next question is from the line of Devin Ryan with JMP Securities. Your line is open.

Maybe just starting here and just a couple of follow-ups here. European M&A announcements have been pretty much stagnant since 2009, you know a couple of recessions over there, some disruptive events. So appreciate the comments on the broader M&A picture and I get that there’s a lot of moving parts here as we look forward. But when you look at Europe specifically, is that cautious optimism, maybe that I would characterize it as your outlook for this year. The same over there or just how are you thinking about some of the scenarios in Europe and the year ahead?

I would say that we are cautiously optimistic there, but there’s even more uncertainty there we believe than here, and so I guess that cautious optimism I hate to [agree] type of that is even more cautious. We really believe that the people and strategic decision makers over there really are looking and want to be moving forward. We just think there are a lot of barriers and obstacle or maybe better said headwinds that they are confronting right now. And as Roger said, there’s a lot that’s going to happen in the next two or three months that is really going to indicate what happens over the whole year. And I think a lot of people are sitting and watching right now. I hope that’s helpful

I appreciate that. And then just one on the restructuring business, how are you guys thinking about revenue momentum there, I am sure there’s some spillover of mandate from last year. So maybe that keeps revenue elevated but it would seem that new mandates are slowing from the outset. So I’m just curious how you guys would characterize what’s going on in that business?

Well as you know, and we’ve made this point many times. Restructuring business historically has been almost perfectly counter cyclical vis-à-vis the M&A, when one is up, the other is down and vice versa for reasons that actually are very logical when think them through. Now this past year or two has been a bit different, because restructuring business was stronger than historically one would have thought, ‘despite’ a stronger M&A market. So we’ll see, Evercore has a great restructuring business and as you know we are big believers in it. It’s a great business, if you think we’re one of the three leaders in the world in that business. I say think as the date is not perfect. A lot of situations you don’t know about because they are resolved privately rather than publicly. But we’re big believers in the business, we have a great team, it’s served us extremely well for many years and I will continue to do so. And whether this historical cyclicality has now been interrupted as the last couple of years say or whether we’re going to reassert itself going forward, just too hard to tell.

And then just last quick one here, the Luminous Partners interest stake that was taken yesterday, I guess a 19% stake, (inaudible) there was already relationship there. Is there a timeline here for a full acquisition? I know you’ve done deals like this in the past, but just to remind us around the rationale buying an interest in a company versus a full acquisition.

Sure. Two years ago when we entered in to the partnership with Luminous, we made a loan to them which was convertible in to a 19% interest in the company. So this was essentially a mechanical conversion of our debt instrument in to a 19% interest. Their business is off to a good start, we’re thrilled to have them as partners and we don’t contemplate any change in that equity ownership position at this point.

And our next question is from the line of Jeff Harte with Sandler O’Neill. Your line is open.

A couple of thoughts from me. One, when we look at the comp ratio and I guess I’m trying to get the potential for it improve overtime. 2016 was near the higher end of the long term range, as we’ve talked about. Can you talk a little bit about the balance between what should be some positive operating leverage on the pretty impressive advisory revenue growth you’ve had versus the cost of continued hiring and extending.

I would say that, first of all, the comp ratio that we had this year was the lowest we’ve had in my memory. And I think we’ve consistently said that we expect to make progress toward a comp ratio that is 55% to 58% to 59% and we’ve done that. And we’ve also said that if an opportunity presents itself to grow the value of the firm by hiring a higher than normal number of senior managing directors that we’ll take advantage of that and we’ll obviously at that point explain to you how we might affect the comp ratio, the progress that we have consistently made to be affected. Interestingly enough in 2015 we had a year where we hired 10 senior managing directors and I think at the beginning of that year or mid of that year we said, we at least advised you that its possible so that would have an impact on our steady progress with respect to the comp ratio. And fortunately we had a strong enough year from a topline point of view, this in fact did not happen. So the comp ratio will be a function of our revenues and our hiring and we really can’t provide any forward guidance at this point, and at the end of the first quarter obviously we’ll have to have a comp ratio which will be our best guess to what it will be for the year. And I think we’ll be prepared to discuss it a little more robustly then.

On the non-comp as well, I guess I’m a little more used to kind of looking at the dollar amount quarter-to-quarter as oppose to the ratio. I know the ratio keeps getting better, but the dollar amount stepped up quite a bit at the back half of 2016. Dollar amount wise how should we think of that going for us, the function of higher headcount or are there some unusual items which seemed to maybe go back to where it had been running.

I think Jeff you should continue to expect the dollar amount to grow with the number of people in the firm. As you know that’s the metric that we take the greatest attention to and we try to get some leverage there as we did this year reducing our cost per head. In the fourth quarter, there’s couple of lumpy items if you look back over the past couple of years, the fourth quarter seems to attract a couple of mud because drops back in the first quarter and then normalizes. So I wouldn’t read too much in to the quarter. Look for us to continue to grow the firm, add people and that will be the real driver of our [non-cut] cost.

What was the apply count at the end of the year?

1,475.

And then finally, if this has been hit on already, but to those concept and I’m looking at kind of use of excess cash. So turning excess to shareholders, can you help me balance that a bit against what looks like a pretty low pay-out ratio of what we think your operating cash flow would be for the year. You returned a lot of capital to shareholders relative to what it looks like what your operating cash flows were. It actually looks like a pretty historically low amount.

Our Board’s policy with respect to the regular dividend has been to increase it steadily year-over-year. It’s generally I think our third quarter Board meeting where we consider the dividend for the next 12 month period of time. And if you look back historically the Board has been pretty regularly increasing it by 10% plus or minus. And I don’t want to speak for the Board, but I suspect there - and the reason the payout ratio has drifted down of it is that fortunately for all of us our earnings have grown at a faster pace than our dividend has. So this is a business that should be run carefully in our view and I think that that historical policy represents the Board’s view of what should happen to the regular dividend. So whatever excess cash flow we develop and we’ve been very consistent about returning all of our cash flow to our shareholders historically has all gone in to buybacks. And I think it is way too early in the year to say. At this point I think that’s our anticipation again.

There appear to be no further questions at this time. I would now like to turn the floor to Ralph Schlosstein for closing remarks.

Thanks very much everyone and we’ll speak to you next quarter. Thanks Operator.