Mirror Merger Sub 2, LLC

CIK:0000350797|SEC Filings

Consolidated Statements of Income - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Oct. 31, 2020	Oct. 31, 2019	Oct. 31, 2018
Revenue:
Total revenue	$ 1,730,365	$ 1,683,252	$ 1,692,422
Expenses:
Compensation and related costs	793,681	626,513	604,631
Distribution expense	141,170	150,239	165,033
Service fee expense	115,211	107,762	106,831
Amortization of deferred sales commissions	24,986	22,593	18,394
Fund-related expenses	42,441	40,357	37,602
Other expenses	238,636	214,917	204,729
Total expenses	1,356,125	1,162,381	1,137,220
Operating income	374,240	520,871	555,202
Non-operating income (expense):
Gains and other investment income, net	3,243	51,040	10,066
Interest expense	(23,940)	(23,795)	(23,629)
Other income (expense) of consolidated collateralized loan obligation (CLO) entities:
Gains and other investment income, net	36,123	70,272	16,882
Interest and other expense	(55,201)	(59,350)	(15,286)
Total non-operating income (expense)	(39,775)	38,167	(11,967)
Income before income taxes and equity in net income of affiliates	334,465	559,038	543,235
Income tax expense	(83,900)	(135,252)	(156,703)
Equity in net income (loss) of affiliates, net of tax	(117,231)	9,090	11,373
Net income	133,334	432,876	397,905
Net (income) loss attributable to non-controlling and other beneficial interests	5,182	(32,841)	(15,967)
Net income attributable to Eaton Vance Corp. shareholders	$ 138,516	$ 400,035	$ 381,938
Earnings per share:
Basic	$ 1.26	$ 3.63	$ 3.33
Diluted	$ 1.20	$ 3.50	$ 3.11
Weighted average shares outstanding:
Basic	109,617	110,064	114,745
Diluted	115,735	114,388	122,932
Management Fees [Member]
Revenue:
Total revenue	$ 1,514,388	$ 1,463,943	$ 1,459,186
Distribution And Underwriter Fees [Member]
Revenue:
Total revenue	77,056	85,612	97,371
Service Fees [Member]
Revenue:
Total revenue	131,724	123,073	122,231
Other Revenue [Member]
Revenue:
Total revenue	$ 7,197	$ 10,624	$ 13,634

Consolidated Statements of Cash Flows $ in Thousands	12 Months Ended
Consolidated Statements of Cash Flows $ in Thousands	Oct. 31, 2020 USD ($)	Oct. 31, 2019 USD ($)	Oct. 31, 2018 USD ($)
Cash Flows From Operating Activities:
Net income	$ 133,334	$ 432,876	$ 397,905
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	23,385	23,706	25,013
Amortization of deferred sales commissions	24,986	22,592	18,394
Stock-based compensation	237,541	90,998	87,047
Deferred income taxes	35,347	4,503	25,246
Net (gains) losses on investments and derivatives	21,613	(8,255)	17,796
Loss on expiration of Hexavest option	0	0	6,523
Equity in net (income) loss of affiliates, net of tax	117,231	(9,090)	(11,373)
Dividends received from affiliates	7,433	10,927	12,243
Non-cash operating lease expense	17,289	0	0
Consolidated CLO entities' operating activities:
Net (gains) losses on bank loans, other investments and note obligations	37,184	4,240	(1,999)
Amortization of bank loan investments	(3,772)	(1,447)	(248)
(Increase) decrease in other assets, net of other liabilities	(11,360)	12,680	(150)
Increase (decrease) in cash due to initial consolidation (deconsolidation) of CLO entities	(4,606)	19,009	51,278
Changes in operating assets and liabilities:
Management fees and other receivables	(11,914)	(1,052)	(36,427)
Short-term debt securities	27,457	(24,663)	(59,551)
Investments held by consolidated sponsored funds and separately managed accounts	(268,996)	(28,492)	(181,797)
Deferred sales commissions	(30,430)	(29,169)	(30,598)
Other assets	5,039	(1,459)	(1,960)
Accrued compensation	5,356	6,674	26,806
Accounts payable and accrued expenses	10,953	(4,924)	10,287
Operating lease liabilities	(17,760)	0	0
Other liabilities	(30,481)	(7,836)	5,286
Net cash provided by operating activities	324,829	511,818	359,721
Cash Flows From Investing Activities:
Additions to equipment and leasehold improvements	(21,043)	(34,897)	(18,747)
Net cash paid in acquisition	(28,800)	0	0
Proceeds from sale of investments	16,333	14,067	24,486
Purchase of investments	(288)	(3,514)	(7,022)
Proceeds from sale of investments in CLO entity note obligations	27,258	0	76,563
Purchase of investments in CLO entity note obligations	(39,494)	(54,352)	(147,322)
Consolidated CLO entities' investing activities:
Proceeds from sale of bank loans and other investments	645,390	501,356	154,871
Purchase of bank loans and other investments	(1,113,797)	(1,098,530)	(407,883)
Net cash used for investing activities	(514,441)	(675,870)	(325,054)
Cash Flows From Financing Activities:
Purchase of additional non-controlling interest	(8,372)	(91,617)	(20,818)
Proceeds from line of credit	300,000	0	0
Repayment of line of credit	(300,000)	0	0
Line of credit issuance costs	0	(930)	0
Principal repayments on notes receivable from stock option exercises	3,548	1,183	4,825
Dividends paid	(183,893)	(159,123)	(144,855)
Net subscriptions received from (redemptions/distributions paid to) non-controlling interest holders	240,742	44,508	100,360
Consolidated CLO entities' financing activities:
Proceeds from line of credit	177,035	197,915	245,898
Repayment of line of credit	(133,410)	(197,915)	(258,496)
Issuance of senior and subordinated notes obligations	451,610	794,767	1,320,397
Principal repayments of senior and subordinated note obligations	(500)	(389,000)	(865,624)
Net cash provided by (used for) for financing activities	474,551	(48,356)	184,413
Effect of currency rate changes on cash and cash equivalents	(1,618)	(322)	(2,868)
Net increase (decrease) in cash, cash equivalents and restricted cash	283,321	(212,730)	216,212
Cash, cash equivalents and restricted cash, beginning of year	653,345	866,075	649,863
Cash, cash equivalents and restricted cash, end of year	936,666	653,345	866,075
Supplemental Cash and Restricted Cash Flow Information:
Cash paid for interest	23,141	22,695	22,660
Cash paid for interest by consolidated CLO entities	55,946	38,140	10,681
Cash paid for income taxes, net of refunds	102,252	125,054	135,105
Supplemental Schedule of Non-Cash Investing and Financing Transactions:
Increase in equipment and leasehold improvements due to non-cash additions	1,058	4,341	1,336
Increase in definitive-lived intangible assets due to non-cash acquistion consideration	19,311	0	0
Operating lease right-of-use assets recognized upon adoption of new lease guidance	270,040	0	0
Operating lease liabilities recognized upon adoption of new lease guidance	318,824	0	0
Operating lease right-of-use assets obtained in exchange for new operating lease liabilities	328	0	0
Exercise of stock options through issuance of notes receivable	2,187	1,573	1,770
Non-controlling interest call option exercises recorded in other liabilities	6,772	8,372	14,133
Decrease in non-controlling interests due to net deconsolidation of sponsored investment funds	(301,867)	(67,989)	(25,320)
Decrease in bank loans and other investments of consolidated CLO entities due to unsettled sales	(23,886)	(24,193)	0
Increase in bank loans and other investments of consolidated CLO entities due to unsettled purchases	392,447	33,985	149,617
Initial Consolidation of CLO Entities:
Increase in bank loans and other investments	0	410,853	814,122
Increase in senior loan obligations	0	391,080	843,089
Deconsolidation of CLO Entities:
Decrease in bank loans and other investments	(445,569)	0	(379,676)
Decrease in senior and subordinated note obligations	(421,601)	0	(378,742)
Non-Voting Common Stock [Member]
Cash Flows From Financing Activities:
Proceeds from issuance of Voting Common Stock	112,567	51,256	76,447
Repurchase of Common Stock	(185,212)	(299,400)	(273,550)
Supplemental Schedule of Non-Cash Investing and Financing Transactions:
Non-Voting Common Stock repurchases recorded in accounts payable and accrued expenses	0	13,670	13,136
Voting Common Stock [Member]
Cash Flows From Financing Activities:
Proceeds from issuance of Voting Common Stock	581	0	0
Repurchase of Common Stock	$ (145)	$ 0	$ (171)

Consolidated Balance Sheets - USD ($) $ in Thousands	Oct. 31, 2020	Oct. 31, 2019
Assets
Cash and cash equivalents	$ 799,384	$ 557,668
Management fees and other receivables	249,806	237,864
Investments	783,246	1,060,739
Deferred sales commissions	60,655	55,211
Deferred income taxes	33,423	62,661
Equipment and leasehold improvements, net	71,830	72,798
Operating lease right-of-use assets	253,109	0
Intangible assets, net	120,175	75,907
Goodwill	259,681	259,681
Loan to affiliate	5,000	5,000
Other assets	129,017	85,087
Total assets	4,949,298	4,253,629
Liabilities:
Accrued compensation	246,129	240,722
Accounts payable and accrued expenses	83,991	89,984
Dividend payable	42,988	55,177
Debt	621,348	620,513
Operating lease liabilities	301,419	0
Other liabilities	47,454	108,982
Total liabilities	3,402,759	2,783,595
Commitments and contingencies (Note 21)
Temporary Equity:
Redeemable non-controlling interests	222,854	285,915
Total temporary equity	222,854	285,915
Permanent Equity:
Additional paid-in capital	176,461	0
Notes receivable from stock option exercises	(7,086)	(8,447)
Accumulated other comprehensive loss	(63,276)	(58,317)
Retained earnings	1,217,138	1,250,439
Total Eaton Vance Corp. shareholders' equity	1,323,685	1,184,119
Non-redeemable non-controlling interests	0	0
Total permanent equity	1,323,685	1,184,119
Total liabilities, temporary equity and permanent equity	4,949,298	4,253,629
Collateralized Loan Obligations (CLO) Entities [Member]
Assets
Cash	91,795	48,704
Bank loans and other investments	2,064,133	1,704,270
Other assets	28,044	28,039
Liabilities:
Senior and subordinated note obligations	1,616,243	1,617,095
Line of credit	43,625	0
Other liabilities	399,562	51,122
Voting Common Stock [Member]
Permanent Equity:
Common Stock	2	2
Non-Voting Common Stock [Member]
Permanent Equity:
Common Stock	$ 446	$ 442