Christopher Crain – General Counsel Scott Beiser – Chief Executive Officer Lindsey Alley – Chief Financial Officer.

Michael Needham – Bank of America Brennan Hawken – UBS Ann Dai – KBW Jim Mitchell – Buckingham Research Jeff Harte – Sandler O'Neill & Partners.

Good day, ladies and gentlemen. Thank you for standing by. Welcome to Houlihan Lokey's First Quarter Fiscal 2019 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. Please note that this conference call is being recorded today July 26, 2018.

I would now like to turn the call over to Christopher Crain, Houlihan Lokey's General Counsel. Please go ahead sir..

Thank you, operator, and hello, everyone. By now everyone should have access to our first quarter fiscal 2019 earnings release, which can be found on the Houlihan Lokey website at www.hl.com in the Investor Relations section.

Before we begin our formal remarks, we need to remind everyone that the discussion today will include forward-looking statements. These forward-looking statements, which are usually identified by use of words such as will, expect, anticipate, should or other similar phrases are not guarantees of future performance.

These statements are subject to numerous risks and uncertainties that could cause actual results to differ materially from what we expect, and therefore, you should exercise caution when interpreting and relying on them.

We refer all of you to our recent SEC filings for a more detailed discussion of the risks that could impact our future operating results and financial condition. We encourage investors to review our regulatory filings, including the Form 10-Q for the quarter ended June 30, 2018, when it is filed with the SEC.

During today's call, we will discuss non-GAAP financial measures, which we believe can be useful in evaluating the company's financial performance. These measures should not be considered in isolation or as a substitute for our financial results prepared in accordance with GAAP.

A reconciliation of these measures to the most directly comparable GAAP measures is available in our earnings release and our investor presentation on the hl.com website. Hosting the call today, we have Scott Beiser, Houlihan Lokey's Chief Executive Officer; and Lindsey Alley, Chief Financial Officer of the company.

They will provide some opening remarks, and then we will open the call to questions. With that, I'll turn the call over to Scott..

ten came from our annual April promotion cycle, nine came from the acquisition of Quayle Munro, five came from the acquisition of BearTooth and one came from the new senior FAS hire.

Overall, our MD headcount rose modestly in Financial Restructuring and Financial Advisory Services, but increased substantially in corporate finance as a result of the two acquisitions.

Our acquisition of Quayle Munro closed in early April and added a firm that predominantly provides corporate finance, advisory services to companies underpinned by data and analytics, contents, software and services.

This team of 40 bankers with extensive sector expertise further strengthened our UK and European investment banking presence in data and analytics, financial institutions, financial technology and education.

This acquisition has already started contributing to our corporate finance revenues and there is both internal and external client excitement around our newest industry vertical. The acquisition of BearTooth closed in mid May and adds a Private Funds placement capability to Houlihan Lokey.

We believe the Private Funds placement business is very strategic for us and we have been looking for an opportunity to enter this service line for many years. We can now offer fund placement services to our extensive private equity and credit fund relationships.

This acquisition also adds a vehicle that allows to develop relationships with the growing an important limited partner community. We intend to use both acquisitions as platforms to expand within the respective areas and we have already announced some senior hires to our private funds group.

We welcome the Quayle Munro and BearTooth teams to the Houlihan Lokey family. Furthermore, we’ve recently announced the formation of HL Finance as a natural extension to our capital markets business. HL Finance will arrange leverage loans for financial sponsor backed privately held and public companies.

The creation of HL Finance leverages our core advisory capabilities and relationships and combines them with the credit underwriting and portfolio management strength of market leading asset managers.

While we are excited about the creation of HL Finance, our new acquisitions and our recent senior level hiring, history suggests it will take a few years before these additions mature on our platform. In the meantime, we produced another quarter of strong results.

Our corporate finance business grew year-over-year despite a continued market decline in the number of global mid-cap transactions closed during the quarter. We are encouraged by the strength of the large cap M&A market and the strong growth in M&A deal value over the last couple quarters.

If history is any guide, a strong large cap M&A market is a leading indicator of a future healthy mid-cap M&A market. While the market sorts out the future for mid-cap M&A deal volume, our corporate finance business continues to experience an increase in new business activity and backlog.

This is a result of what we believe our continued market share gains, continued productivity improvements and the successful addition of new talented bankers across the globe through both direct hiring and acquisitions.

On the Financial Advisory Services business continues to benefit from a strong overall M&A market and remains committed to hiring talent across all of its product lines in order to drive future revenue growth.

FAS has more recent commitment to an industry focus has paid early dividends and its high concentration of institutional clients is paying off in this market environment, as the number of annual engagements we work on continues to steadily climb. For our financial restructuring business, our expectations for fiscal 2019 have not changed.

We entered 2019 with better momentum than expected at this time last year, but we expect our restructuring business to soften a bit relative to its fiscal 2018 results. For the first quarter, we were down 14% versus the same quarter last year.

However, it is important to remember that a restructuring business is our lumpiest business segment and the inclusion or exclusion of one or two transaction fees can make a difference in a quarter. In the first quarter, we closed fewer transactions and our average transaction fee declined when compared to the same quarter last year.

While our first quarter results were restructuring or on the light side, based on our backlog we still expect to produce a solid first half result.

Regarding new business, our restructuring practice continues to see attractive opportunities across the globe as a result of continued technology disruptors and slowly rising interest rates, but at a pace that is consistent with continued relatively low default rates.

We remain committed to a highly diversified business model with limited client, industry, geography and employee concentration and a model that can be opportunistic in any business environment. This model has served us well for nearly three years we've been public and the several decades since the firm was founded.

With that I'll turn the call over to Lindsey..

Thank you, Scott.

Before I comment on the firm's performance for the recently completed quarter, I want to remind everyone of the recent accounting pronouncement ASC 606 that now requires both fee revenues and reimbursable expenses to be included in revenues as opposed to excluding reimbursable expenses from revenues and netting them against non-competition expense.

This pronouncement increased our first quarter revenues and our first quarter non-competition expenses by approximately $11 million. Now on to quarter.

In corporate finance, revenues were $133 million for the quarter, an increase of 7% from the prior year although our average transaction fee on closed deals was lower compared with the same quarter last year. We closed 69 transactions in the quarter compared to 52 in the same period last year.

We continue to experience increases in our quarterly new engagement activity and our recent acquisitions have led to prospects for the year. Financial restructuring revenues were $50 million for the quarter, a 14% decline from the strong first quarter last year.

We closed 13 transactions in the quarter compared to 18 transactions in the same period last year and our average transaction fee on closed deals was lower compared with the same quarter last year.

As Scott mentioned in his comments, our financial restructuring business often had large fee events and the quarter’s performance may be affected by the timing of those events. In Financial Advisory Services, revenues were $37 million for the quarter, a 6% increase from the prior year.

We completed 504 events in the quarter compared to 550 in the same period last year. New business activity has remained robust and revenues per managing director have climbed over the last few years. Turning to expenses. Our adjusted compensation expenses were $133 million for the first quarter versus $139 million for the same period last year.

This resulted in adjusted compensation expense ratio of 60.5% for the quarter, which is within our targeted range for fiscal 2019 of between 60.5% and 61.5%.

Our adjusted non-compensation expenses in the first quarter were $37 million, which were up significantly when compared with the first quarter last year, primarily due to an increase in non-compensation expenses driven by the accounting pronouncement.

This resulted in an adjusted non-compensation expense ratio of 16.8% for the first quarter versus our target ratio of between 14% and 15%. We expect that during our lower revenue quarters, we will be above our target range and during our higher revenue quarters we will be below this range.

Historically, our first quarter is one of our lower revenue quarters.

This quarter we adjusted out approximately $500,000 in primarily legal and accounting costs associated with our registered block trade, which we completed in May, $1.9 million in expenses associated with our acquisitions of Quayle Munro and BearTooth and $1.3 million of acquisition related amortization.

We will continue to adjust these types of expenses in the quarters in which they occur. Our adjusted other income and expense line item resulted in a gain for the quarter of approximately $900,000 versus a gain during the same period last year of $100,000.

The recurring income and expenses included in this line item are gains or losses associated with our Italian joint venture, interest income and interest expense. Most of our income in this line item for the quarter was a result of a gain associated with our joint venture in Italy and interest income on our cash balance throughout the quarter.

We had one adjustment in our other income and expense line item of approximately $700,000 related to a gain due to the reduction of an earn-out liability from the previous acquisition. Because we believe this gain is one off in nature, we have reduced our GAAP other income and expenses from a gain of $1.6 million to an adjusted gain of $900,000.

Our adjusted effective tax for the quarter was 28.9%, which is within our targeted range of between 27% and 29% for the fiscal year. We did not have any adjustments to our GAAP effective tax rate this quarter.

Since we are a March 31 fiscal year company, unlike our publicly traded peers, we did not recognize the full impact of tax reform until this quarter. Turning to the balance sheet and uses of cash. As of the quarter end, we had $160 million of unrestricted cash and equivalents and investment securities and debt of $12 million.

In the first quarter, we paid the bulk of our fiscal 2018 bonuses to our banking staffs, settled our forward contracts related to the secondary offering that we completed in March, paid our quarterly dividend and acquired 697,000 shares in conjunction with the registered block trade of 3 million shares that we completed in May.

Lastly, our board of directors has authorized a new share repurchase program of $100 million. This new authorization replaces our previous $50 million share repurchase program that was authorized in February 2017 and has been fully utilized.

We will continue to use this repurchase program as a means to offset the dilution associated with shares that we issued to employees as part of their annual bonuses in May. With that operator, we can open the line for questions..

[Operator Instructions] We’ll take our first question from Devin Ryan with JMP Securities. Please go ahead..

Hi. This is Brian McKenna for Devin. Thanks for taking the question. So there’s clearly been a lot of noise around trade tariffs and tensions.

Just curious what you're hearing from clients on this topic? And has there been any impact on business confidence or activity thus far?.

It would – it's totally – now it's something that that our clients are talking about, but we haven’t seen it have any material impact on their decision making and whether they want to do transactions or kinds of transactions they might do. It’s really been I think an increased talking point, but so far has not had any impact on our business as well..

Got it, thanks. And then you’ve made a couple of strategic announcements over the past several months.

Are there any additional opportunities or acquisitions in the pipeline you're looking at currently? Or will the focus be more around building out and growing some of these new businesses?.

With any given time, I think, we're always at various stages and talking with the different groups whether it's from acquisitions, whether it's from ventures, new ideas that we have. That being said, I think, considering our recent announcement of some acquisitions, the new formation of HL Finance.

We will continue to – short-term probably focus on building out those opportunities that we've already started on, but that does not mean that we stop hunting and looking and talking to other situations..

All right, got it. Thank you. That's it for me..

Thanks, Brian..

And moving on we'll take our next question from Ken Worthington with JP Morgan. Please go ahead..

Hi, good afternoon. Maybe first on restructuring trying to dig into the pipeline.

Are you – do you feel you're getting your fair share of the more recent deals that have been coming to market over the last couple of quarters? I’m just trying to get a sense of how that that pipeline is building here?.

I think the market opportunities as we said are out there, but they're not at the same pace that we see obviously during a downturn, but in terms of key projects whether they're both in the U.S.

or international, we still believe we're getting our fair share and we're still one of the most active restructuring firms and have been for a couple decades..

Okay, fair enough. Thank you there.

And then as we think about corporate tax reform and the flow of corporate tax reform into middle market M&A, do you feel like it's having the impact you thought it would on activity levels and where do you think this is in terms of the seasoning with your clients? So the thought being a corporate tax reform drives more cash flow, cash flow is used for returning cash to principles, but it also drives M&A activities.

So do you feel like this is well seasoned at this point, is the best kind of from corporate tax reform yet to come in the middle markets like where are we in the innings of the baseball analogy do you think?.

We obviously don't have tax reform all the time, so it's hard to really gauge how this compares to the last couple of times over the last few decades where tax reform has taken M&A, but I would say you know it was a larger amount of the talking points six or nine months ago than it is today.

It's clearly all things being equal increased the net income and thus free cash flow of our clients just companies in general which has done a couple of things. It's made their valuations higher.

It's made companies have a little more cash to do things, but it's probably I'd say it's not is heavily talked about and focused on in terms of their strategic decision making as maybe some things they were thinking about six months ago. It's been net positive, but it's now a topic that is now several months old..

And then lastly on the acquisition of BearTooth, why is it the right time to get into that business now?.

Well, we've been interested in it for many, many years. We think we've got one of the largest financial sponsor coverage groups on the street, especially for the sized deals that we do and it's always been something that we'd like to have offered to the GP-type clients.

We believe that this industry continues to grow in terms of new participants and the marketplaces out there and we feel we’re just qualified as anyone to continue to grow in that area. And would also as alluded to we feel this will also help us with more relationships on the LP side as well.

And it's too tough to try to pick a perfect time and we're not trying to view on where we are in the cycle of fund raising. We think there will always be fund raising for kind of the mid-cap sized deals that we're going to focus on. And so like I said it's type of business we've been looking at for many, many years. .

I think, Ken, if your question is really around timing vis-à-vis when is the next dip in the economy or dip in fundraising cycle, we are in this business for the long haul, and I think for us it was much more important to find the right team and not necessarily do it at the right time.

And we have looked for a long time, and I think we found the right team here, not a large price point item for us. And the other thing about our firm is we have been very opportunistic during recessionary periods because we tend to perform strongly during – very strong during those periods.

And so building a business like that – when that dip comes, whenever that dip comes, we think we can be opportunistic with BearTooth in growing that business and not necessarily worry about when we acquired it..

That’s great. Thank you very much..

And moving on we’ll take our next question from Michael Needham with Bank of America. Please go ahead..

Hey, good afternoon, guys. First on Europe, it seems like you have scenario where we can capture more market share replicating the success you've had in the U.S. You have done acquisitions that you just closed one. It's better saying that an independent model can be a little bit more challenging in Europe, particularly entering from the U.S.

So I just persuade your thoughts on how you guys approach it and ensure that you're going to make these advisory firms better under the Houlihan umbrella?.

Well, maybe I'll start with a couple of the challenges on the European side. One, there is some very good strong long standing historical competitors out there. Two, the European economy has not been as robust as the U.S. economy over the last 10 years. And three, we're typically in the U.S.

your focus on an industry sector and may be a product expertise geography amongst the stages in that critical in Europe geography across the countries is an added layer of complexity.

That being said, when we look at what the positives and what's driven by us is the amount of deal activity for the types of deals we do, and Europe is second only to United States, and so we see a lot of opportunities.

We see what we can develop out in Europe with the staff that we have, and we'll continue to build out in Europe as well as with the expertise that we already have in the United States. And as the world gets more and more global, we will continue to be more and more global. And in fact, our European presence now is in fact larger than what our U.S.

presence was less than a decade ago. So it will take many years to continue to build out and we've realized it's a long game, but we see lots of opportunities for a firm like ourselves to continue to grow and build market share..

And one thing I would add to that is, we have one significant competitive strength, and that is that we think we have the largest middle market M&A platform in the U.S. relative to the competitors in Europe. So when we go in to meet with the company in Europe, nobody can deliver the United States the way we can.

So if we continue to build out this European model, we do have a significant competitive advantage to the folks who are in Europe that are weaker in the United States, better in the middle market or the mid-cap space..

Got it. Okay, that makes sense. And just one more on restructuring. I hear the comments on lumpiness. It sounds like the second fiscal quarter is going to be a bit better.

How much visibility do you have for the full year? Is it just that this quarter was a little bit low versus where you see the run rate for this year? Or is it just too hard to tell at this point?.

We have pretty good visibility a few months out and after that I think it's like any other investment banking firm, it's really hard to tell what you're going to do in nine months from now. But, this was a relatively light quarter if you take a look at the last couple of years in Financial Restructuring.

We've run anywhere from $50 million to $100 million per quarter, and we were roughly $50 million this quarter. And so we were on the low end of the range and expectations are we will continue to perform within that range. And this quarter was just on the lighter side relative to the averages, historically..

Okay. And just one more quick one. Model being the comp ratio of 60% – I thing, it was like 60.5%. I think those are at the bottom of your guidance range.

Is that – since it's the first quarter, is that your best guess for the year?.

No. I think – Scott and I'd like to have a little discussion within 1% range. So and we will, it is our goal is to remain within the 100 basis points. But it's hard for me to tell whether we're going to be towards the lower end of that range or the upper end of that range. It really depends how the rest of the year is going to come out..

Okay, great..

It’s also tied to a little on the non-comp ratio when that's going to be specifically at the higher end. Usually, our comp ratio was going to be at the lower end vice versa within the relatively narrow bands we've talked about in terms of what we expect to achieve throughout the year..

Got it. Thanks..

And moving on we’ll take our next question from Brennan Hawken with UBS. Please go ahead..

Good afternoon, guys, Brennan here, really to hold it down. And so – how are you doing? So quick question on HL Finance.

Could you speak a little bit to your sense of the size of that market? How fragmented it is? How should we think about that opportunity set here for Houlihan? And how long do you think it might take to ramp that up?.

We think it's an incredibly large marketplace. We've been in the ageing of finance for many, many years.

This basically takes us to couple of new areas, probably slightly larger size deals than we've done in the past much more kind of public the syndication type of projects than maybe what we've done in the past, and we think this business has continued to grow, especially post the recession and no reason to think that it won't continue to grow.

Notwithstanding during certain economic downturns and size of the market will shrink. But many of our clients have been talking to us about getting into this business for quite some time. We took our time to kind of study it, analyze it and find the right entry point, the right partners and the right people that we've hired along the way.

But we think it could be an incredibly big and important part of our ongoing growth in the generally speaking the capital market businesses as we define it..

And it’s kind of a nice fit for us. I mean, given the size of the companies that we tend to cover and given the size of our private equity clients relative to our overall clients. And given that it is an advisory business kind of consistent with what we're doing in the rest of the capital markets.

This is kind of a natural extension to what we currently do..

All right, great. That makes sense. And then how we should think about it from an expense perspective.

You guys have already staffed it to where you feel like you have at a level in order to get it started and then assuming that it's able to expand out at a attractive pace than you would simply adjust the staffing levels as the success or growth would wanted.

Is that the right way to think about it?.

Yes, I think total, we added a few people specifically in this area over the last 12 months. We'll add more people as the business grows, but it's not going to be a significant impact in any of our cost structure going forward..

Great. Thanks for the color..

Okay, thank you..

Thanks, Brennan..

Moving on we’ll take our next question from Ann Dai with KBW. Please go ahead..

Hi, good afternoon. Thanks for taking my question. So my first one is kind of following on Brennan's question and applying it to BearTooth. So just curious everyone seems to be building out these fund placement services and business. I'm wondering what you've found proprietary or unique about BearTooth that made you want to acquire them.

And what do you think the opportunity set is over time for them?.

There are a lot of firms and groups that do that. We've looked and talked to many, and I think it's basically the assessment of the experience and capabilities of this team where they're geographically located.

What kinds of deals they've historically closed? How we think that matches up with the relationships we have? And ultimately came to a conclusion it was kind of a marriage made to happen. And like all deals, it always takes a little long to get there, but very happy that we found them and closed on the deal in May..

And Scott, could you speak to that opportunity set over time?.

That’s another large area. If you think about all of the size of the funds, how much money gets placed, how much is hired. Most – probably not all of our key peers have been in this business or in that business. And then we think it's another very sizable market area, and we're effectively historically starting at zero.

We've bought a group that's been in business for a handful of years, so they bring certain amount of backlog in business. And I think it's like most of the other acquisitions we've done. They fit nicely with what we do, but none of them are ever so big that it statistically changes the dial in terms of the size of our firm.

This is a good added piece, but we think in addition to other acquisitions we've done, this one probably has a little more strategic benefit to us because it touches a whole brand new area that we're very familiar with. We just won in that business previously..

Okay, got it. That’s helpful. And just quickly on FAS, so both revenues and fee events I think were down sequentially in year-over-year.

I guess, I was hoping you could comment on that decline, just given the – what seems like a fairly robust M&A environment and I would think the valuations piece is fairly sticky?.

Yes, so the issue I think you have with FAS because it's not a classical transaction that we define. We talk about the number of clients that we produced revenues of at least $1 million, excuse me, at least $1,000. And it's generally been in that $500 plus or minus.

And so there are a lot of them that for particular quarter, you could be doing for just a couple of $1,000 before it actually finishes up the project. So I don't think we overly focus on the number of fee events we have. We're basically looking at, I'd say, the talent of the people we have.

How many do have? What kinds of projects are they working on? And in fact our staff, we think is as strong as it's ever been. And in terms of new activity and business that we're bringing in, it has been very good, I'd say, over the last couple of quarters..

Okay, thank you. And a last one from me just on the repurchase authorization.

I know you mentioned it's generally meant to offset dilution but is there room there to be a little bit more opportunistic and take up some repurchase in open market? And then also, with something like you did with ORIX, did the authorization applied towards that?.

Yes, so last year, we issued $56 million worth of stock to our bankers as part of the bonus system or actually in last May. So we are – we do have some dry powder.

If there are opportunities to acquire stock and value we think makes sense, we will certainly do that and the idea of acquiring shares of ORIX is certainly something that the Board did and authorized once before, and I think if there is an opportunity and it makes sense and the Board agrees to it.

We have the capability to do that under this authorization program. So to answer your last question, yes, it covers purchases, such as that as well..

Okay, that’s it for me. Thanks Lindsey..

Thanks Yian..

And we’ll take our next question from Jim Mitchell with Buckingham Research. Please go ahead..

Good afternoon.

Maybe you could talk just a little bit about the impact of Quayle Munro and BearTooth acquisitions this quarter with a dilutive breakeven or accretive? And how do you see that the ramping over the next few quarters?.

So it's hard to answer as to whether or not it's accretive or dilutive for the quarter. I just honestly have not done that analysis. They both contributed this quarter. Expectations have not changed for the year since we've acquired them.

And both on track to do exactly what we expect them to do for their first year out-of-the-box, honestly, we haven't taken a look at as to whether or not they were accretive or dilutive for this quarter..

Okay, that’s fine. And maybe just given your relationships on the private equity side, I think you guys had noted that the contribution to your overall revenue pie from private equity firms is kind of at the lower end of your historical range, there's quite a bit of dry powder at private equity funds.

Do you see that changing? Do you see them some leverage finance deals are up. It seems like private equity is getting more active.

Are you seeing that and do you see that as a big or a potential tailwinds over the next couple of years for you?.

Yes, but at least for the private equity firms that we cover, we think there is active as they've ever been. Availability of capital still is out there, business prospects for companies that they're buying or looking to sell are still positive.

And all the trends that really – ourselves and our peers have talked about I think over the last couple of quarters or a couple of years continues to point to some productive and healthy times for the private equity community..

Okay. And one last one on the leverage finance platform. I mean, it's not explicitly stated, but I would assume that there is no credit or capital risk that you're taking in this business and it simply would be kind of in the range or fee – underwriting fee on top of any kind of debt advisory fee.

Is that the right way to think about it?.

Yes, that's exactly the way to think about it. We do not intend to take any balance sheet risk with this new entity..

Okay, great. Thanks..

[Operator Instructions] We’ll hear next from Jeff Harte with Sandler O'Neill & Partners. Please go ahead..

Hi, good afternoon guys..

Hi Jeff..

Quick, can you talk a little bit about, I guess, I'm ultimately trying to get at the kind of middle market activity level. You mentioned earlier that kind of the mid-cap market slagging the large-cap market. And we clearly see that in the visible announcements count versus dollar volume.

But I also kind of look at the middle market phenomena of same day announcements and completions is may be distorting that.

So I mean, can you talk a little bit about what you're seeing in the middle markets especially kind of how it would compare it to the publicly or the visible announcement data that we can see?.

Jeff, you're right. You do always have in the middle market kind of announcements and closes can be done at the same time period. But I think what we look at it is really over the last several years, the announced number of deals, not dollar value, but number of deals announced or completed, whether it's in the U.S.

or globally, provided by the various data sources has been flat to probably slightly downward. And it's been like that for many years.

But in fact, we've been focused on as we've always said, we still believe we have a large market share in the mid-cap space relative to others, but it's still a very small amount and it's all about how can we take our 2% to 3% or 3% to 4% in terms of market shares.

So we continue to, on average, close more deals year-by-year or quarter-by-quarter, yet the number of announced or completed deals in the mid-cap space is strong.

The second thing that we've seen is, historically, when the big cap marketplace heats up, it does encourage more deals and it tends to pull along the mid-cap deals some time later, whether that's a couple of quarters or couple of years, that's kind of in the trends if you look at it over several decades..

Okay. And you had mentioned coming out of last quarter, I believe, that the Corporate Finance pipeline was at a record level.

If I missed it earlier, I apologize, have you commented at all where that pipeline stands relative to last quarter?.

Yes, we don’t quote exact numbers, but it continues to grow and it's bigger today than it was last quarter. And part of it is, we've acquired, as we said, a couple of businesses. We've added some additional people. But all of the signs continue to, for us, as we see more activity today than we've seen in previous quarters..

Okay, thank you..

[Operator Instructions] I'm seeing as there are no further questions. That concludes today's question-and-answer session. I'd now like to turn the call over to CEO, Scott Beiser, for any additional or closing remarks..

I want to thank you all for participating in our first quarter earnings call, and we look forward to updating everybody on our progress when we discuss our second quarter results for fiscal 2019 in the fall. Thank you..

Once again that does conclude today’s conference. Thank you for your participation. You may now disconnect..