This excerpt taken from the GHL 10-K filed Mar 11, 2005.
Note 14 Business Information
The Companys activities as an investment banking firm constitute a single business segment, with two principal sources of revenue:
The Company has principally earned its revenues from advisory fees earned from clients in large part upon the successful completion of the clients transaction or restructuring. Financial advisory revenues represented approximately 86%, 96% and 95%, of the Companys total revenues for the years ended December 31, 2004, 2003 and 2002 respectively.
The Company had separate clients in 2004 and 2003 which comprised 10% and 17% of total revenue, respectively. The Companys revenues attributable to these clients related to an engagement similar in nature to all of the Companys other advisory engagements.
The Companys financial advisory and merchant banking activities are closely aligned and have similar economic characteristics. Generally, the Companys professionals and employees are treated as a common pool of available resources and the related compensation and other Company costs are not directly attributable to either particular revenue source. In reporting to management, the Company distinguishes the sources of its investment banking revenues between financial advisory and merchant banking. However, management does not evaluate other financial data or operating results such as operating expenses, profit and loss or assets by its financial advisory and merchant banking activities.
Since the financial markets are global in nature, the Company generally manages its business based on the operating results of the enterprise taken as whole, not by geographic region. The Companys investment banking
activities are conducted out of its offices in New York, London and Frankfurt. For reporting purposes, the geographic regions are the locations in which the Company retains its employees, the United States and Europe.
The following table presents information about the Company by geographic region, after elimination of all significant inter-company accounts and transactions: