The latest accounts from the European operation of M&A and restructuring firm PJT Partners are further proof that it makes sense to work for a boutique if you you're an investment banking professional. They're also proof that an absence of profits need not preclude very generous pay.
PJT Partners (UK)'s results for the year ending 31st December 2017 show the firm employing 121 people, up from 107 a year earlier. 88 were in front office 'sales' jobs; just 33 were in admin. PJT's total spending on pay, pensions and employment taxes included, was £64,565,595, implying average pay per head of £534k ($701k). Absent employment taxes and pensions, pay per head was £477k ($623k) for last year.
Either way it was pretty good. Pay in London seems to be on a par with pay at PJT globally: as we reported in July the boutique is on track to pay its 460 or so people around the world an average of $750k this year.
What's surprising, is that PJT paid this generously in London despite making a loss of slightly over £5m on revenues of £71m. It could have been worse: in 2016, PJT's UK operation made a loss of £18m on turnover of £49m.
Senior staff there are sort of feeling the squeeze. In 2017 PJT's highest earning UK director took home £2.4m. In 2016, the highest earning UK director took home £3m. Woe.
Things might get worse. U.S. analyst James Mitchell at Buckingham research has a sell note out on boutique banks after a tough third quarter (although he thinks the current M&A cycle has further to run). PJT Partners' people might want to save their generous pay just in case.
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