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Houlihan Lokey Reports Second Quarter Fiscal 2026 Financial Results
– Second Quarter Fiscal 2026 Revenues of $659 million –
– Second Quarter Fiscal 2026 Diluted EPS of $1.63 –
– Adjusted Second Quarter Fiscal 2026 Diluted EPS of $1.84 –
– Announces Dividend of $0.60 per Share for Third Quarter Fiscal 2026 –
LOS ANGELES and NEW YORK - October 30, 2025 - Houlihan Lokey, Inc. (NYSE:HLI) (“Houlihan Lokey” or the “Company”) today reported financial results for its second quarter ended September 30, 2025.
For the second quarter ended September 30, 2025, revenues were $659 million, compared with $575 million for the second quarter ended September 30, 2024. Net income was $112 million, or $1.63 per diluted share, for the second quarter ended September 30, 2025, compared with $94 million, or $1.37 per diluted share, for the second quarter ended September 30, 2024. Adjusted net income for the second quarter ended September 30, 2025 was $127 million, or $1.84 per diluted share, compared with $100 million, or $1.46 per diluted share, for the second quarter ended September 30, 2024.
“Our results for the quarter reflect our strong business model and improving market conditions. We enter the second half of the year with optimism for continued momentum,” stated Scott Adelson, Chief Executive Officer of Houlihan Lokey.
Selected Financial Data
| | | | | | | | | | | | | | | | | | | | | | | |
| (In thousands, except per share data) | U.S. GAAP |
| Three Months Ended September 30, | | Six Months Ended September 30, |
| 2025 | | 2024 | | 2025 | | 2024 |
| Revenues by segment | | | | | | | |
| Corporate Finance | $ | 438,661 | | | $ | 364,028 | | | $ | 837,180 | | | $ | 692,445 | |
| Financial Restructuring | 133,803 | | | 131,568 | | | 262,019 | | | 248,990 | |
| Financial and Valuation Advisory | 86,988 | | | 79,361 | | | 165,602 | | | 147,131 | |
Revenues | $ | 659,452 | | | $ | 574,957 | | | $ | 1,264,801 | | | $ | 1,088,566 | |
Operating expenses: | | | | | | | |
| Compensation | $ | 423,202 | | | $ | 360,637 | | | $ | 816,039 | | | $ | 690,753 | |
| Non-compensation | 84,909 | | | 83,651 | | | 207,621 | | | 172,404 | |
Operating income | 151,341 | | | 130,669 | | | 241,141 | | | 225,409 | |
| Other (income) expense, net | (8,712) | | | (5,419) | | | (16,962) | | | (10,553) | |
Income before provision for income taxes | 160,053 | | | 136,088 | | | 258,103 | | | 235,962 | |
| Provision for income taxes | 48,272 | | | 42,539 | | | 48,789 | | | 53,473 | |
| | | | | | | |
| | | | | | | |
| Net income | $ | 111,781 | | | $ | 93,549 | | | $ | 209,314 | | | $ | 182,489 | |
| | | | | | | |
Diluted earnings per share | $ | 1.63 | | | $ | 1.37 | | | $ | 3.04 | | | $ | 2.67 | |
Revenues
For the second quarter ended September 30, 2025, revenues were $659 million, compared with $575 million for the second quarter ended September 30, 2024. For the second quarter ended September 30, 2025, Corporate Finance (“CF”) revenues increased 21%, Financial Restructuring (“FR”) revenues increased 2%, and Financial and Valuation Advisory (“FVA”) revenues increased 10%, in each case, when compared with the second quarter ended September 30, 2024.
Expenses
The Company’s compensation expenses, non-compensation expenses, and provision for income taxes during the periods presented and described below are on a GAAP and an adjusted basis.
| | | | | | | | | | | | | | | | | | | | | | | |
| U.S. GAAP | | Adjusted (Non-GAAP) * |
| Three Months Ended September 30, |
| ($ in thousands) | 2025 | | 2024 | | 2025 | | 2024 |
| Expenses: | | | | | | | |
| Compensation | $ | 423,202 | | | $ | 360,637 | | | $ | 405,562 | | | $ | 353,599 | |
| % of Revenues | 64.2 | % | | 62.7 | % | | 61.5 | % | | 61.5 | % |
| Non-compensation | $ | 84,909 | | | $ | 83,651 | | | $ | 82,319 | | | $ | 80,879 | |
| % of Revenues | 12.9 | % | | 14.5 | % | | 12.5 | % | | 14.1 | % |
Per full-time employee (1) | $ | 31 | | | $ | 32 | | | $ | 30 | | | $ | 31 | |
| Provision for income taxes | $ | 48,272 | | | $ | 42,539 | | | $ | 53,518 | | | $ | 45,610 | |
| % of Pre-tax income | 30.2 | % | | 31.3 | % | | 29.7 | % | | 31.3 | % |
*Adjusted figures represent non-GAAP information. See “Non-GAAP Financial Measures” and the tables at the end of this release for an explanation of the adjustments and reconciliations to the comparable GAAP numbers.
(1)Calculated using the average of the number of full-time employees at the beginning of the reporting period and the end of the reporting period.
| | | | | | | | | | | | | | | | | | | | | | | |
| U.S. GAAP | | Adjusted (Non-GAAP) * |
| Six Months Ended September 30, |
| ($ in thousands) | 2025 | | 2024 | | 2025 | | 2024 |
| Expenses: | | | | | | | |
| Compensation | $ | 816,039 | | | $ | 690,753 | | | $ | 777,851 | | | $ | 669,468 | |
| % of Revenues | 64.5 | % | | 63.5 | % | | 61.5 | % | | 61.5 | % |
| Non-compensation | $ | 207,621 | | | $ | 172,404 | | | $ | 176,788 | | | $ | 161,209 | |
| % of Revenues | 16.4 | % | | 15.8 | % | | 14.0 | % | | 14.8 | % |
Per full-time employee (1) | $ | 76 | | | $ | 65 | | | $ | 65 | | | $ | 61 | |
| Provision for income taxes | $ | 48,789 | | | $ | 53,473 | | | $ | 52,355 | | | $ | 83,849 | |
| % of Pre-tax income | 18.9 | % | | 22.7 | % | | 16.0 | % | | 31.2 | % |
*Adjusted figures represent non-GAAP information. See “Non-GAAP Financial Measures” and the tables at the end of this release for an explanation of the adjustments and reconciliations to the comparable GAAP numbers.
(1)Calculated using the average of the number of full-time employees at the beginning of the reporting period and the end of the reporting period.
Compensation expenses were $423 million for the second quarter ended September 30, 2025, compared with $361 million for the second quarter ended September 30, 2024. This resulted in a compensation ratio of 64.2% for the second quarter ended September 30, 2025, compared with 62.7% for the second quarter ended September 30, 2024. Adjusted compensation expenses were $406 million for the second quarter ended September 30, 2025, compared with $354 million for the second quarter ended September 30, 2024. This resulted in an adjusted compensation ratio of 61.5% for both the second quarter ended September 30, 2025 and the second quarter ended September 30, 2024. The increase in GAAP and adjusted compensation expenses was a result of an increase in revenues for the quarter when compared with the same quarter last year.
Non-compensation expenses were relatively flat at $85 million for the second quarter ended September 30, 2025, compared with $84 million for the second quarter ended September 30, 2024. Adjusted non-compensation expenses were relatively flat at $82 million for the second quarter ended September 30, 2025, compared with $81 million for the second quarter ended September 30, 2024.
The provision for income taxes was $48 million, representing an effective tax rate of 30.2% for the second quarter ended September 30, 2025, compared with $43 million, representing an effective tax rate of 31.3% for the second quarter ended September 30, 2024. The adjusted provision for income taxes was $54 million, representing an adjusted effective tax rate of 29.7% for the second quarter ended September 30, 2025, compared with $46 million, representing an adjusted effective tax rate of 31.3% for the second quarter ended September 30, 2024.
Segment Reporting for the Second Fiscal Quarter
Corporate Finance
CF revenues were $439 million for the second quarter ended September 30, 2025, compared with $364 million for the second quarter ended September 30, 2024, representing an increase of 21%. Revenues increased due to an increase in the number of closed transactions during the quarter, which was driven by favorable market conditions for M&A and Capital Solutions. This increase was partially offset by a decrease in the average transaction fee on closed transactions, which was driven by transaction mix and does not represent a trend in the average fee on closed transactions.
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Six Months Ended September 30, |
| ($ in thousands) | 2025 | | 2024 | | 2025 | | 2024 |
| Corporate Finance | | | | | | | |
| Revenues | $ | 438,661 | | | $ | 364,028 | | | $ | 837,180 | | | $ | 692,445 | |
# of Managing Directors (1) | 242 | | | 224 | | | 242 | | | 224 | |
# of Closed transactions (2) | 171 | | | 131 | | | 296 | | | 247 | |
Financial Restructuring
FR revenues were $134 million for the second quarter ended September 30, 2025, compared with $132 million for the second quarter ended September 30, 2024, representing an increase of 2%. Revenues increased due to an increase in the number of closed transactions during the quarter, which was driven by favorable market conditions for restructuring transactions. This increase was partially offset by a decrease in the average transaction fee on closed transactions, which was driven by transaction mix and does not represent a trend in the average fee on closed transactions.
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Six Months Ended September 30, |
| ($ in thousands) | 2025 | | 2024 | | 2025 | | 2024 |
| Financial Restructuring | | | | | | | |
| Revenues | $ | 133,803 | | | $ | 131,568 | | | $ | 262,019 | | | $ | 248,990 | |
# of Managing Directors (1) | 58 | | | 58 | | | 58 | | | 58 | |
# of Closed transactions (2) | 37 | | | 33 | | | 72 | | | 66 | |
Financial and Valuation Advisory
FVA revenues were $87 million for the second quarter ended September 30, 2025, compared with $79 million for the second quarter ended September 30, 2024, representing an increase of 10%. Revenues increased due to an increase in the number of Fee Events, driven by improvements in the M&A markets.
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Six Months Ended September 30, |
| ($ in thousands) | 2025 | | 2024 | | 2025 | | 2024 |
| Financial and Valuation Advisory | | | | | | | |
| Revenues | $ | 86,988 | | | $ | 79,361 | | | $ | 165,602 | | | $ | 147,131 | |
# of Managing Directors (1) | 45 | | | 41 | | | 45 | | | 41 | |
# of Fee Events (2) | 1,075 | | | 903 | | | 1,517 | | | 1,316 | |
(1)As of the end of the respective reporting period.
(2)A Fee Event includes any engagement that involves revenue activity during the measurement period based on a revenue minimum of one thousand dollars. References in this press release to closed transactions should be understood to be the same as transactions that are “effectively closed” as described in our annual report on Form 10-K.
Balance Sheet and Capital Allocation
The Board of Directors of the Company declared a regular quarterly cash dividend of $0.60 per share of Class A and Class B common stock. The dividend will be payable on December 15, 2025 to stockholders of record as of the close of business on December 1, 2025. As of September 30, 2025, the Company had $1.11 billion of unrestricted cash and cash equivalents and investment securities.
Investor Conference Call and Webcast
The Company will host a conference call and live webcast at 5:00 p.m. Eastern Time on Thursday, October 30, 2025, to discuss its second quarter fiscal 2026 results. The number to call is 1-844-825-9789 (domestic) or 1-412-317-5180 (international) and entering the conference ID 10203876. A live webcast will be available in the Investor Relations section of the Company’s website. A replay of the conference call will be available from October 30, 2025 through November 6, 2025, by dialing 1-844-512-2921 (domestic) or 1-412-317-6671 (international) and entering the passcode 10203876. A replay of the webcast will be archived and available on the Company’s website.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the federal securities laws. You can identify these statements by our use of the words “assumes,” “believes,” “estimates,” “expects,” “guidance,” “intends,” “plans,” “projects,” and similar expressions that do not relate to historical matters. You should exercise caution in interpreting and relying on forward-looking statements because they involve known and unknown risks, uncertainties, and other factors which are, in some cases, beyond the Company’s control and could materially affect actual results, performance, or achievements. For a further description of such factors, you should read the Company’s filings with the Securities and Exchange Commission. Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, you should not rely on these forward-looking statements as predictions of future events. The events and circumstances reflected in our forward-looking statements may not be achieved or occur and actual results could differ materially from those projected in the forward-looking statements. The Company does not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.
Non-GAAP Financial Measures
Adjusted net income, total and on a per share basis, and certain adjusted items used to determine adjusted net income, are presented and discussed in this earnings press release and are non-GAAP measures that management believes, when presented together with comparable GAAP measures, are useful to investors in understanding the Company’s operating results. The adjusted items included in this earnings press release as calculated by the Company are not necessarily comparable to similarly titled measures reported by other companies. Additionally, these adjusted amounts are not a measurement of financial performance or liquidity under GAAP and should not be considered as an alternative to the Company’s financial information determined under GAAP. For a description of the Company’s use of these adjusted items and a reconciliation with comparable GAAP items, see the section of this press release titled “Reconciliation of GAAP to Adjusted Financial Information.” Please refer to our financial statements, prepared in accordance with GAAP, for purposes of evaluating our financial condition, results of operations, and cash flows.
About Houlihan Lokey
Houlihan Lokey, Inc. (NYSE:HLI) is a global investment bank with expertise in mergers and acquisitions, capital solutions, financial restructuring, and financial and valuation advisory. Houlihan Lokey serves corporations, institutions, and governments worldwide with offices in the Americas, Europe, the Middle East, and the Asia Pacific region. Independent advice and intellectual rigor are hallmarks of the firm’s commitment to client success across its advisory services. The firm is the No. 1 investment bank for all global M&A transactions for the past two years, the No. 1 M&A advisor for the past 10 years in the U.S., the No. 1 global restructuring advisor for the past 11 years, and the No. 1 global M&A fairness opinion advisor over the past 25 years, all based on number of transactions and according to data provided by LSEG.
For more information, please visit www.HL.com.
Contact Information
| | | | | | | | |
Investor Relations
212.331.8225
IR@HL.com | OR | Media Relations
212.331.8223
PR@HL.com |
Appendix
Condensed Consolidated Balance Sheets (Unaudited)
Condensed Consolidated Statements of Income (Unaudited)
Reconciliation of GAAP to Adjusted Financial Information (Unaudited)
HOULIHAN LOKEY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
| | | | | | | | | | | |
| (In thousands, except share data and par value) | September 30, 2025 | | March 31, 2025 |
| Assets: | | | |
| Cash and cash equivalents | $ | 923,576 | | | $ | 971,007 | |
| | | |
| Investment securities | 184,642 | | | 195,624 | |
| Accounts receivable, net of allowance for credit losses | 251,156 | | | 257,326 | |
| Unbilled work in process, net of allowance for credit losses | 191,248 | | | 157,760 | |
| | | |
| | | |
| Property and equipment, net | 145,193 | | | 149,350 | |
| Operating lease right-of-use assets | 352,622 | | | 362,669 | |
| Goodwill | 1,292,121 | | | 1,284,589 | |
| Other intangible assets, net | 200,881 | | | 212,670 | |
| Other assets | 251,926 | | | 228,713 | |
| Total assets | $ | 3,793,365 | | | $ | 3,819,708 | |
| | | |
| Liabilities and stockholders' equity | | | |
| Liabilities: | | | |
| Accrued salaries and bonuses | $ | 822,763 | | | $ | 936,619 | |
| Accounts payable and accrued expenses | 108,861 | | | 137,228 | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| Operating lease liabilities | 432,899 | | | 438,185 | |
| Other liabilities | 181,950 | | | 132,799 | |
| Total liabilities | 1,546,473 | | | 1,644,831 | |
| | | |
| Stockholders' equity: | | | |
| Class A common stock, $0.001 par value. Authorized 1,000,000,000 shares; issued and outstanding 54,573,369 and 53,822,189 shares, respectively | 55 | | | 54 | |
| Class B common stock, $0.001 par value. Authorized 1,000,000,000 shares; issued and outstanding 15,564,859 and 16,021,106 shares, respectively | 16 | | | 16 | |
| | | |
| | | |
| Additional paid-in capital | 759,693 | | | 843,350 | |
| Retained earnings | 1,516,154 | | | 1,394,738 | |
| Accumulated other comprehensive loss | (29,026) | | | (63,281) | |
| | | |
| | | |
| Total stockholders’ equity | 2,246,892 | | | 2,174,877 | |
| Total liabilities and stockholders’ equity | $ | 3,793,365 | | | $ | 3,819,708 | |
HOULIHAN LOKEY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Six Months Ended September 30, |
| (In thousands, except share and per share data) | 2025 | | 2024 | | 2025 | | 2024 |
| Revenues | $ | 659,452 | | | $ | 574,957 | | | $ | 1,264,801 | | | $ | 1,088,566 | |
| Operating expenses: | | | | | | | |
| Employee compensation and benefits | 405,562 | | | 353,599 | | | 777,851 | | | 669,468 | |
| Acquisition related compensation and benefits | 17,640 | | | 7,038 | | | 38,188 | | | 21,285 | |
| Travel, meals, and entertainment | 15,168 | | | 13,570 | | | 35,155 | | | 32,082 | |
| Rent | 17,750 | | | 15,174 | | | 35,979 | | | 34,458 | |
| Depreciation and amortization | 10,303 | | | 7,444 | | | 26,293 | | | 16,300 | |
| Information technology and communications | 16,704 | | | 17,755 | | | 34,516 | | | 33,944 | |
| Professional fees | 10,321 | | | 9,677 | | | 21,993 | | | 18,154 | |
| Other operating expenses | 14,663 | | | 20,031 | | | 35,790 | | | 36,638 | |
| Revaluation of acquisition contingent consideration | — | | | — | | | 17,895 | | | 828 | |
| Total operating expenses | 508,111 | | | 444,288 | | | 1,023,660 | | | 863,157 | |
| Operating income | 151,341 | | | 130,669 | | | 241,141 | | | 225,409 | |
| Other (income) expense, net | (8,712) | | | (5,419) | | | (16,962) | | | (10,553) | |
| Income before provision for income taxes | 160,053 | | | 136,088 | | | 258,103 | | | 235,962 | |
| Provision for income taxes | 48,272 | | | 42,539 | | | 48,789 | | | 53,473 | |
| Net income | $ | 111,781 | | | $ | 93,549 | | | $ | 209,314 | | | $ | 182,489 | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| Weighted average shares of common stock outstanding: |
| Basic | 66,963,260 | | | 65,822,690 | | | 66,605,683 | | | 65,429,115 | |
| Fully diluted | 68,591,031 | | | 68,422,600 | | | 68,760,543 | | | 68,450,866 | |
| Earnings per share | | | | | | | |
| Basic | $ | 1.67 | | | $ | 1.42 | | | $ | 3.14 | | | $ | 2.79 | |
| Fully diluted | $ | 1.63 | | | $ | 1.37 | | | $ | 3.04 | | | $ | 2.67 | |
HOULIHAN LOKEY, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP TO ADJUSTED FINANCIAL INFORMATION
(UNAUDITED)
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Six Months Ended September 30, |
| (In thousands, except share and per share data) | 2025 | | 2024 | | 2025 | | 2024 |
| Revenues | $ | 659,452 | | | $ | 574,957 | | | $ | 1,264,801 | | | $ | 1,088,566 | |
| | | | | | | |
| Compensation expenses | | | | | | | |
| Compensation expenses (GAAP) | $ | 423,202 | | | $ | 360,637 | | | $ | 816,039 | | | $ | 690,753 | |
| | | | | | | |
| Less: Acquisition related compensation and benefits | (17,640) | | | (7,038) | | | (38,188) | | | (21,285) | |
| Compensation expenses (adjusted) | 405,562 | | | 353,599 | | | 777,851 | | | 669,468 | |
| | | | | | | |
| Non-compensation expenses | | | | | | | |
| Non-compensation expenses (GAAP) | $ | 84,909 | | | $ | 83,651 | | | $ | 207,621 | | | $ | 172,404 | |
| Less: Acquisition related legal structure reorganization | — | | | (705) | | | (874) | | | (1,205) | |
| Less: Integration and acquisition related costs | — | | | — | | | — | | | (3,554) | |
| Less: Acquisition amortization | (2,590) | | | (2,067) | | | (12,064) | | | (5,608) | |
| Less: Revaluation of acquisition contingent consideration | — | | | — | | | (17,895) | | | (828) | |
| | | | | | | |
| Non-compensation expenses (adjusted) | 82,319 | | | 80,879 | | | 176,788 | | | 161,209 | |
| | | | | | | |
| Operating income | | | | | | | |
| Operating income (GAAP) | $ | 151,341 | | | $ | 130,669 | | | $ | 241,141 | | | $ | 225,409 | |
Plus: Adjustments (1) | 20,230 | | | 9,810 | | | 69,021 | | | 32,480 | |
| Operating income (adjusted) | 171,571 | | | 140,479 | | | 310,162 | | | 257,889 | |
| | | | | | | |
| Other (income) expense, net | | | | | | | |
| Other (income) expense, net (GAAP) | $ | (8,712) | | | $ | (5,419) | | | $ | (16,962) | | | $ | (10,553) | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| Other (income) expense, net (adjusted) | (8,712) | | | (5,419) | | | (16,962) | | | (10,553) | |
| | | | | | | |
| Provision for income taxes | | | | | | | |
| Provision for income taxes (GAAP) | $ | 48,272 | | | $ | 42,539 | | | $ | 48,789 | | | $ | 53,473 | |
| Plus: Impact of the excess tax benefit for stock vesting | — | | | — | | | — | | | 21,921 | |
| | | | | | | |
| Less: Non-deductible acquisition related costs | (759) | | | — | | | (2,053) | | | — | |
| Less: Reversal of deferred tax asset | — | | | — | | | — | | | (1,690) | |
| Adjusted provision for income taxes | 47,513 | | | 42,539 | | | 46,736 | | | 73,704 | |
Plus: Resulting tax impact (2) | 6,005 | | | 3,071 | | | 5,619 | | | 10,145 | |
| Provision for income taxes (adjusted) | 53,518 | | | 45,610 | | | 52,355 | | | 83,849 | |
| | | | | | | |
| Net income | | | | | | | |
| Net income (GAAP) | $ | 111,781 | | | $ | 93,549 | | | $ | 209,314 | | | $ | 182,489 | |
Plus: Adjustments (3) | 14,984 | | | 6,739 | | | 65,455 | | | 2,104 | |
| Net income (adjusted) | $ | 126,765 | | | $ | 100,288 | | | $ | 274,769 | | | $ | 184,593 | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| Fully diluted shares outstanding | | | | | | | |
| Fully diluted shares outstanding (GAAP) | 68,591,031 | | | 68,422,600 | | | 68,760,543 | | | 68,450,866 | |
| Plus: Impact of unvested GCA retention and deferred share awards | 313,996 | | | 458,865 | | | 349,380 | | | 532,840 | |
| Fully diluted shares outstanding (adjusted) | 68,905,027 | | | 68,881,465 | | | 69,109,923 | | | 68,983,706 | |
| | | | | | | |
| Fully diluted EPS (GAAP) | $ | 1.63 | | | $ | 1.37 | | | $ | 3.04 | | | $ | 2.67 | |
| Fully diluted EPS (adjusted) | $ | 1.84 | | | $ | 1.46 | | | $ | 3.98 | | | $ | 2.68 | |
(1)The aggregate of adjustments from compensation and non-compensation expenses.
(2)Reflects the tax impact of utilizing the adjusted effective tax rate on the non-tax adjustments identified above.
(3)Consists of all adjustments identified above net of the associated tax impact.
