Piper Sandler Companies [PIPR] Q4 2022 Earnings Conference Call February 3, 2023 9:00 AM ET

Company Participants

Chad Abraham - Chairman & CEO

Deb Schoneman - President

Tim Carter - CFO

Conference Call Participants

Devin Ryan - JMP Securities

James Yaro - Goldman Sachs

Steven Chubak - Wolfe Research

Mike Grondahl - Northland Securities

Operator

Good morning, and welcome to the Piper Sandler Companies conference call to discuss the Financial Results for the fourth quarter and full year of 2022. During the question-and-answer session, securities industry professionals may ask questions of management. The company has asked that I remind you that statements on this call that are not historical or current facts, including statements about beliefs and expectations, are forward-looking statements that involve inherent risks and uncertainties. Factors that could cause actual results to differ materially from those anticipated are identified in the company's earnings release and reports on file with the SEC, which are available on the company's website at www.pipersandler.com, and on the SEC website at www.sec.gov. This call will also include statements regarding certain non-GAAP financial measures. The non-GAAP measures should be considered in addition to, and not a substitute for, measures of financial performance prepared in accordance with GAAP. Please refer to the company's earnings release issued today for a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP measure. The earnings release is available on the Investor Relations page of the company's website and at the SEC website. As a reminder, this call is being recorded.

And now, I'd like to turn the call over to Mr. Chad Abraham. Mr. Abraham, you may begin your call.

Chad Abraham

Good morning and thank you for joining us. I am here with Deb Schoneman, our President, and Tim Carter, our CFO. We will go through our prepared remarks, and then open up the call for questions. Our diversified platform continues to perform well despite the challenging market backdrop. We finished 2022 with the fourth quarter representing our strongest quarter of the year. We generated adjusted net revenues of $391 million, a 19.3% operating margin, and adjusted EPS of $3.33. On a full year basis, adjusted net revenues were $1.4 billion, generating an 18.8% operating margin, and adjusted EPS of $11.26. 2022 was our second strongest year on record behind 2021. There are a number of highlights worth noting from 2022. We acquired DBO Partners, which doubled our technology banking platform, and positions us well for further growth in this important sector. The acquisition of Cornerstone Macro added a high quality macro, thematic, and quantitative research product, that has proven to be synergistic with our equities business. We acquired Stamford Partners, a specialist M&A boutique focused on European food and beverage companies, which represents a natural expansion of one of our existing industry power allies. We generated advisory revenues of over $770 million, representing 54% of our total net revenues, and our second best advisory year ever. We grew market share in our equities brokerage business, generating record revenues in that business line, and we grew investment banking managing director headcount on a net basis, finishing the year with 159 MDs, the most in our history. Overall, 2022 marks a successful year as we continue to make significant strides in expanding our market presence, and in increasing the earnings capacity and resiliency of our platform.