Victory Capital Holdings Inc
For the period ended Jun 30, 2024. Filed Aug 9, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Aug 9, 2024
VCTR$119.24+6.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-03-31; filed 2024-05-10.
0000950170-24-057507
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-06-30; filed 2024-08-09.
0000950170-24-094388
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 126 previous paragraphs and 142 current paragraphs.
79 unchanged; 41 reworded; 21 added; 4 removed; 2 previous and 1 current paragraphs rearranged.
Tables are not compared: 16 previous and 18 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (21)
Current report
AUM at June 30, 2024 decreased by $1.7 billion, or 1.0%, to $168.7 billion from $170.3 billion at March 31, 2024, driven by net outflows of $1.7 billion.
Current report
AUM at June 30, 2024 and 2023 was $168.7 billion and $157.2 billion, respectively. We generated $13.3 billion in gross flows and $2.9 billion in net outflows for the six months ended June 30, 2024 compared to $11.8 billion in gross flows and $2.6 billion in net outflows for the same period in 2023. Net flows for the six months ended June 30, 2024 were comprised of $2.7 billion and $0.1 billion of net long-term and short-term outflows, respectively.
Current report
Net income was $74.3 million for the three months ended June 30, 2024 compared to $56.7 million for the same period in 2023. For the six months ended June 30, 2024 and 2023, net income was $129.9 million and $105.9 million, respectively.
Current report
(2) Total AUM includes both discretionary assets under management and non-discretionary assets under advisement and excludes other assets.
Current report
(4) Total AUM includes both discretionary assets under management and non-discretionary assets under advisement and excludes other assets.
Current report
June 30, 2024 AUM compared to March 31, 2024 AUM. At June 30, 2024, our total AUM was $168.7 billion, a decrease of $1.7 billion, or 1.0%, from $170.3 billion at March 31, 2024, driven by net outflows $1.7 billion.
Current report
Six months ended June 30, 2024 compared to June 30, 2023. Investment management fees increased by $26.7 million, or 8.4%, to $342.9 million for the six months ended June 30, 2024 from $316.2 million due to same factor discussed above in the quarterly section.
Current report
Six months ended June 30, 2024 compared to June 30, 2023. Fund administration and distribution fees increased by $3.2 million, or 3.6%, to $92.5 million for the six months ended June 30, 2024 from $89.3 million for the same period in 2023 due to the same factors as discussed above in the quarterly section.
Current report
Three months ended June 30, 2024 compared to June 30, 2023. Personnel compensation and benefits were $55.7 million for the three months ended June 30, 2024, an increase of $0.7 million, or 1.3%, from $54.9 million for the same period in 2023 due to an increase in incentive and sales based compensation partially offset by a decrease in salaries, payroll related taxes and employee benefits. Incentive compensation and equity awards granted to employees and directors were $24.5 million and $3.8 million, respectively, for the three months ended June 30, 2024, compared to $21.3 million and $4.2 million, respectively, for the same period in 2023. Salaries, payroll related taxes and employee benefits and sales-based compensation were $21.2 million and $5.6 million, respectively, for the three months ended June 30, 2024, compared to $22.8 million and $5.1 million, respectively, for the same period in 2023.
Current report
Six months ended June 30, 2024 compared to June 30, 2023. Personnel compensation and benefits increased by $2.6 million, or 2.3%, to $115.1 million for the six months ended June 30, 2024 from $112.5 million for the same period in 2023 due to an increase in variable costs such as incentive and sales-based compensation. Incentive compensation and equity awards granted to employees and directors were $48.4 million and $7.7 million, respectively, for the six months ended June 30, 2024, compared to $43.2 million and $8.5 million, respectively, for the same period in 2023. Salaries, payroll related taxes and employee benefits and sales-based compensation were $45.7 million and $11.7 million, respectively, for the six months ended June 30, 2024, compared to $47.3 million and $10.5 million, respectively, for the same period in 2023.
Current report
Six months ended June 30, 2024 compared to June 30, 2023. Distribution and other asset-based expenses were $72.7 million for the six months ended June 30, 2024, a decrease of $2.3 million, or 3.0%, from $75.0 million for the same period in 2023 primarily due to a decrease in the same factors as discussed above in the quarterly section.
Current report
Six months ended June 30, 2024 compared to June 30, 2023. For the six months ended June 30, 2024 and 2023, general and administrative expenses were $28.4 million and $25.6 million, respectively, for a year over year increase of $2.8 million, or 10.8%. The increase was primarily due to the same factors as discussed above in the quarterly section.
Current report
Six months ended June 30, 2024 compared to June 30, 2023. Depreciation and amortization decreased by $6.2 million, or 29.0%, to $15.2 million for the six months ended June 30, 2024 from $21.3 million for the same period in 2023 due to the same factors as discussed above in the quarterly section.
Current report
Three months ended June 30, 2024 compared to June 30, 2023. The change in value of consideration payable for acquisition of business decreased $9.7 million primarily due to a $8.2 million decrease in the fair value of contingent consideration associated with the WestEnd Acquisition for the three months ended June 30, 2024 compared to a decrease of $0.2 million for the three months ended June 30, 2023. Also contributing was a $1.7 million increase in the fair value of contingent consideration associated with the USAA AMCO Acquisition for the three months ended June 30, 2023. Refer to Note 4, Acquisitions, for further details on the fair value of contingent consideration payable.
Current report
Six months ended June 30, 2024 compared to June 30, 2023. Acquisition-related costs were $4.1 million and $18 thousand for the six months ended June 30, 2024 and 2023, respectively. The acquisition-related costs for the six months ended June 30, 2024 were related to the same factors discussed above in the quarterly section.
Current report
Six months ended June 30, 2024 compared to June 30, 2023. Restructuring and integration costs were $0.6 million and $29 thousand for the six months ended June 30, 2024 and 2023, respectively. The restructuring and integration costs for the six months ended June 30, 2024 were related to the same factors discussed above in the quarterly section.
Current report
Three months ended June 30, 2024 compared to June 30, 2023. For the three months ended June 30, 2024 and 2023, interest income and other income/(expense) was income of $1.6 million and $2.0 million, respectively. The income for the three months ended June 30, 2024 and 2023 was primarily due to dividend income.
Current report
Six months ended June 30, 2024 compared to June 30, 2023. For the six months ended June 30, 2024 and 2023, interest expense and other financing costs were $32.8 million and $29.1 million, respectively. The year-over-year increase is primarily due to the same factors as discussed above in the quarterly section.
Current report
Six months ended June 30, 2024 compared to June 30, 2023. For the six months ended June 30, 2024 and 2023, the effective tax rate was 22.5% and 22.4%, respectively. Refer to Note 8, Income Taxes, for further details on the Company's income taxes.
Current report
We maintained a $100.0 million revolving credit facility at June 30, 2024 and December 31, 2023 (under the 2019 Credit Agreement) which had approximately $100.0 million undrawn as of June 30, 2024 and December 31, 2023. On June 7, 2024, the Company entered into the Fifth Amendment to the 2019 Credit Agreement, extending the maturity date of the $100,000,000 senior secured first lien revolving facility from July 1, 2024 to March 31, 2026, and decreasing the drawn interest rate margin by 0.50% per annum. The revolving facility otherwise remains subject to substantially the same terms as those set forth in the 2019 Credit Agreement. The Company incurred $1.0 million in upfront fees, arranger fees and other third party costs related to the Fifth Amendment to the 2019 Credit Agreement, which were recorded to revolving credit facility debt issuance cost in other assets.
Current report
Cash used in investing activities during the six months ended June 30, 2023 was $3.9 million and consisted of primarily of property and equipment purchases of $2.6 million and $1.4 million of net trading activity.
Removed paragraphs (4)
Previous report
AUM at March 31, 2024 increased by $9.0 billion, or 5.6%, to $170.3 billion from $161.3 billion at December 31, 2023, driven by market appreciation of $10.2 billion partially offset by net outflows of $1.1 billion. Total gross flows for the first quarter were $7.2 billion, including long-term gross flows of $7.0 billion.
Previous report
Net income was $55.7 million for the three months ended March 31, 2024 compared to $49.3 million for the same period in 2023.
Previous report
Three months ended March 31, 2024 compared to March 31, 2023. Personnel compensation and benefits were $59.5 million for the first quarter of 2024, an increase of $1.9 million, or 3.2%, from $57.6 million for the same period in 2023 attributable to an increase in variable costs such as sales commissions and the incentive compensation pool for employees.
Previous report
Investing Activities –Cash used in investing activities during the three months ended March 31, 2024 was $0.9 million and consisted of net trading activity of $0.4 million and $0.5 million of property and equipment purchases. The nature of our trading activities is further described in Note 2, Significant Accounting Policies, to the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2023.
Reworded paragraphs (41)
Previous wording
The objective of this section of the Quarterly Report on Form 10-Q is intended to provide a discussion and analysis, from management’s perspective, of the key performance indicators and material information necessary to assess our financial condition and results of operations for the three months ended March 31, 2024 and 2023 and cash flows for the three months ended March 31, 2024 and 2023. In addition, we also discuss the Company’s contractual and off-balance sheet arrangements. This discussion and analysis should be read in conjunction with the unaudited condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q and with our Annual Report on Form 10-K for the year ended December 31, 2023. This discussion and analysis contains forward-looking statements and should also be read in conjunction with the disclosures and information contained in “Forward-Looking Statements” included elsewhere in this Quarterly Report on Form 10-Q and in “Item 1A. Risk Factors” included in the Annual Report on Form 10-K for the year ended December 31, 2023.
Current wording
The objective of this section of the Quarterly Report on Form 10-Q is intended to provide a discussion and analysis, from management’s perspective, of the key performance indicators and material information necessary to assess our financial condition and results of operations for the three and six months ended June 30, 2024 and 2023 and cash flows for the six months ended June 30, 2024 and 2023. In addition, we also discuss the Company’s contractual and off-balance sheet arrangements. This discussion and analysis should be read in conjunction with the unaudited condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q and with our Annual Report on Form 10-K for the year ended December 31, 2023. This discussion and analysis contains forward-looking statements and should also be read in conjunction with the disclosures and information contained in “Forward-Looking Statements” included elsewhere in this Quarterly Report on Form 10-Q and in “Item 1A. Risk Factors” included in the Annual Report on Form 10-K for the year ended December 31, 2023.
Previous wording
Our Business –Victory is a diversified global asset management firm with total client assets of $175.5 billion, assets under management of $170.3 billion and other assets of $5.1 billion as of March 31, 2024. The Company operates a next-generation business model combining boutique investment qualities with the benefits of an integrated, centralized operating and distribution platform.
Current wording
Our Business – Victory is a diversified global asset management firm with total client assets of $173.8 billion, assets under management of $168.7 billion and other assets of $5.1 billion as of June 30, 2024. The Company operates a next-generation business model combining boutique investment qualities with the benefits of an integrated, centralized operating and distribution platform.
Previous wording
The Company provides specialized investment strategies to institutions, intermediaries, retirement platforms and individual investors with 11 autonomous Investment Franchises and a Solutions Platform. Victory Capital offers a wide array of investment products, including actively and passively managed mutual funds, rules-based and active exchange traded funds (“ETFs”), institutional separate accounts, variable insurance products (“VIPs”), alternative investments, private closed end funds, and a 529 Education Savings Plan. Victory Capital’s strategies are also offered through third-party investment products, including mutual funds, third-party ETF model strategies, retail separately managed accounts (“SMAs”) and unified managed accounts (“UMAs”) through wrap account programs, Collective Investment Trusts (“CITs”), and undertakings for the collective investment in transferable securities (“UCITs”). As of March 31, 2024, our Franchises and our Solutions Platform collectively managed a diversified set of 121 investment strategies for a wide range of institutional and retail clients and direct investors.
Current wording
The Company provides specialized investment strategies to institutions, intermediaries, retirement platforms and individual investors with 11 autonomous Investment Franchises and a Solutions Platform. Victory Capital offers a wide array of investment products, including actively and passively managed mutual funds, rules-based and active exchange traded funds (“ETFs”), institutional separate accounts, variable insurance products (“VIPs”), alternative investments, private closed end funds, and a 529 Education Savings Plan. Victory Capital’s strategies are also offered through third-party investment products, including mutual funds, third-party ETF model strategies, retail separately managed accounts (“SMAs”) and unified managed accounts (“UMAs”) through wrap account programs, Collective Investment Trusts (“CITs”), and undertakings for the collective investment in transferable securities (“UCITs”). As of June 30, 2024, our Franchises and our Solutions Platform collectively managed a diversified set of 122 investment strategies for a wide range of institutional and retail clients and direct investors.
Previous wording
We have grown our total client assets from $17.9 billion following the management-led buyout with Crestview GP in August 2013 to $175.5 billion at March 31, 2024. We attribute this growth to our success in sourcing acquisitions and evolving them into organic growers, generating strong investment returns, and developing institutional, retail, and direct investor channels with deep penetration.
Current wording
We have grown our total client assets from $17.9 billion following the management-led buyout with Crestview GP in August 2013 to $173.8 billion at June 30, 2024. We attribute this growth to our success in sourcing acquisitions and evolving them into organic growers, generating strong investment returns, and developing institutional, retail, and direct investor channels with deep penetration.
Previous wording
AUM at March 31, 2024 and 2023 was $170.3 billion and $153.4 billion, respectively. We experienced $10.2 billion in market appreciation for the three months ended March 31, 2024 compared to $6.7 billion in market action for the same period in 2023. We generated $7.2 billion in gross sales, including $7.0 billion in long-term gross sales, and $1.1 billion in total net outflows for the three months ended March 31, 2024 compared to $6.1 billion in gross flows inclusive of $5.8 billion in long-term gross sales and $1.1 billion in total net outflows for the same period in 2023.
Current wording
AUM at June 30, 2024 and 2023 was $168.7 billion and $157.2 billion, respectively. We generated $6.1 billion in gross flows and $1.7 billion in net outflows for the three months ended June 30, 2024 compared to $5.7 billion in gross flows and $1.4 billion in net outflows for the same period in 2023.
Previous wording
45 of our Victory Capital mutual funds and ETFs had overall Morningstar ratings of four or five stars and 69% of our fund and ETF AUM were rated four or five stars overall by Morningstar. 54% of our strategies by AUM had investment returns in excess of their respective benchmarks over a one-year period, 61% over a three-year period, 85% over a five-year period and 80% over a ten-year period. On an equal-weighted basis, 63% of our strategies have outperformed their benchmarks over a one-year period, 63% over a three-year period, 64% over a five-year period and 65% over a ten-year period.
Current wording
44 of our Victory Capital mutual funds and ETFs had overall Morningstar ratings of four or five stars and 68% of our fund and ETF AUM were rated four or five stars overall by Morningstar. 49% of our strategies by AUM had investment returns in excess of their respective benchmarks over a one-year period, 60% over a three-year period, 77% over a five-year period and 79% over a ten-year period. On an equal-weighted basis, 58% of our strategies have outperformed their benchmarks over a one-year period, 62% over a three-year period, 63% over a five-year period and 64% over a ten-year period.
Previous wording
Total revenue for the three months ended March 31, 2024 was $215.9 million compared to $201.3 million for the same period in 2023.
Current wording
Total revenue for the three months ended June 30, 2024 was $219.6 million compared to $204.2 million for the same period in 2023. For the six months ended June 30, 2024 and 2023, total revenue was $435.5 million and $405.5 million, respectively.
Previous wording
Adjusted EBITDA was $112.4 million for the three months ended March 31, 2024, or 52.1% of revenue, compared to $99.2 million, or 49.3% of revenue, for the same period in 2023. Refer to “Supplemental Non-GAAP Financial Information” for further information about the Adjusted EBITDA calculation and reconciliation of generally accepted accounting principles (“GAAP”) net income to Adjusted EBITDA.
Current wording
Adjusted EBITDA was $116.5 million for the three months ended June 30, 2024, or 53.0% of revenue, compared to $104.0 million, or 50.9% of revenue, for the same period in 2023. For the six months ended June 30, 2024, Adjusted EBITDA was $228.9 million, or 52.6% of revenue, compared to $203.2 million, or 50.1% of revenue, for the same period in 2023. Refer to “Supplemental Non-GAAP Financial Information” for further information about the Adjusted EBITDA calculation and reconciliation of generally accepted accounting principles (“GAAP”) net income to Adjusted EBITDA.
Previous wording
Adjusted Net Income with tax benefit was $82.3 million for the three months ended March 31, 2024 compared to $75.2 million for the three months ended March 31, 2023. Refer to “Supplemental Non-GAAP Financial Information” for further information about the Adjusted Net Income calculation and reconciliation of GAAP net income to Adjusted Net Income.
Current wording
Adjusted Net Income with tax benefit was $86.6 million for the three months ended June 30, 2024 compared to $75.9 million for the three months ended June 30, 2023. For the six months ended June 30, 2024, Adjusted Net Income with tax benefit was $169.0 million compared to $151.1 million for the same period in 2023. Refer to “Supplemental Non-GAAP Financial Information” for further information about the Adjusted Net Income calculation and reconciliation of GAAP net income to Adjusted Net Income.
Previous wording
The following table presents a reconciliation our total client assets(1) as of the dates indicated:
Current wording
The following table presents a reconciliation of our total client assets(1) as of the dates indicated:
Previous wording
The following table presents our total AUM by asset class as of the dates indicated:
Current wording
The following table presents our AUM by asset class as of the dates indicated:
Previous wording
The following tables summarize our total AUM asset flows by asset class for the periods indicated:
Current wording
The following tables summarize our asset flows by asset class for the periods indicated:
Previous wording
The following table presents our total AUM by distribution channel as of the dates indicated:
Current wording
The following table presents our AUM by distribution channel as of the dates indicated:
Previous wording
March 31, 2024 AUM compared to December 31, 2023 AUM. At March 31, 2024, our total AUM was $170.3 billion, an increase of $9.0 billion, or 5.6%, from $161.3 billion at December 31, 2023, primarily due to market appreciation of $10.2 billion partially offset by net outflows of $1.1 billion.
Current wording
June 30, 2024 AUM compared to December 31, 2023 AUM. Total AUM increased by $7.4 billion, or 4.6%, to $168.7 billion at June 30, 2024 compared to $161.3 billion at December 31, 2023. The increase in AUM was due to positive market action of $10.3 billion partially offset by net outflows of $2.9 billion.
Previous wording
Net outflows were driven by our U.S. mid cap, U.S. small cap, and U.S. large cap equity strategies as well as our Solutions platform of $0.5 billion, $0.4 billion, $0.3 billion, and $0.2 billion, respectively, partially offset by net inflows from our global non-U.S. equity strategies and Alternative investments platform of $0.3 billion and $0.1 billion, respectively.
Current wording
Net outflows were driven by our U.S. mid cap, U.S. small cap, and U.S. large cap equity strategies, our fixed income strategies, and our Solutions platform of $1.1 billion, $0.6 billion, $0.5 billion, $0.3 billion, and $0.4 billion, respectively, partially offset by net inflows of $0.3 billion in our global/non-US equity strategies.
Previous wording
The following table presents our GAAP results of operations for the three months ended March 31, 2024 and 2023.
Current wording
The following table presents our GAAP results of operations for the three and six months ended June 30, 2024 and 2023.
Previous wording
Three months ended March 31, 2024 compared to March 31, 2023. Investment management fees increased by $12.9 million, or 8.3%, to $169.8 million for the three months ended March 31, 2024 from $156.8 million for the same period in 2023 due to an increase in average AUM year over year. Average AUM was $163.5 billion for the three months ended March 31, 2024 compared to $152.5 billion for the same period in 2023.
Current wording
Three months ended June 30, 2024 compared to June 30, 2023. Investment management fees increased 8.6%, or $13.8 million, to $173.2 million for the three months ended June 30, 2024 from $159.4 million for the same period in 2023 due to an increase in average AUM over the comparable period.
Previous wording
Three months ended March 31, 2024 compared to March 31, 2023. Fund administration and distribution fees increased by $1.6 million, or 3.6%, to $46.1 million for the three months ended March 31, 2024 from $44.5 million for the same period in 2023 mostly due to an increase in fund administration fees partially offset by a decrease in transfer agent fees.
Current wording
Three months ended June 30, 2024 compared to June 30, 2023. Fund administration and distribution fees increased by $1.6 million, or 3.7%, to $46.5 million for the three months ended June 30, 2024 compared to $44.8 million for the same period in 2023 due primarily to higher mutual fund average net assets.
Previous wording
The following table presents the components of GAAP personnel compensation and benefits expense for the three months ended March 31, 2024 and 2023:
Current wording
The following table presents the components of GAAP personnel compensation and benefits expense for the three and six months ended June 30, 2024 and 2023:
Previous wording
The following table presents the components of distribution and other asset-based expenses for the three months ended March 31, 2024 and 2023:
Current wording
The following table presents the components of distribution and other asset-based expenses for the three and six months ended June 30, 2024 and 2023:
Previous wording
Three months ended March 31, 2024 compared to March 31, 2023. Distribution and other asset-based expenses were $36.3 million for the three months ended March 31, 2024, compared to $37.7 million for the same period in 2023. The decrease of $1.4 million, or 3.7% was primarily due to lower platform distribution fees over the comparable period.
Current wording
Three months ended June 30, 2024 compared to June 30, 2023. Distribution and other asset-based expenses are primarily based on AUM. For the three months ended June 30, 2024, distribution and other asset-based expenses were $36.5 million, a decrease of $0.9 million, or 2.3%, from $37.3 million for the same period in 2023. The decrease is primarily due to lower platform distribution fees over the comparable period.
Previous wording
Three months ended March 31, 2024 compared to March 31, 2023. General and administrative expenses were $14.0 million for the three months ended March 31, 2024 compared to $12.4 million for the same period in 2023. The increase of $1.6 million, or 13.1%, was primarily due to increases in technology and marketing related expenses.
Current wording
Three months ended June 30, 2024 compared to June 30, 2023. General and administrative expenses were $14.4 million for the three months ended June 30, 2024 compared to $13.3 million for the same period in 2023. The increase of $1.1 million, or 8.6%, was primarily due to an increase in technology and marketing-related expenses.
Previous wording
Three months ended March 31, 2024 compared to March 31, 2023. Depreciation and amortization decreased $4.1 million, or 34.9%, to $7.6 million for the three months ended March 31, 2024 from $11.7 million for the same period in 2023, primarily due to a decrease in amortization expense related to definite-lived intangible assets in connection with the USAA and NEC acquisitions.
Current wording
Three months ended June 30, 2024 compared to June 30, 2023. Depreciation and amortization decreased by $2.1 million, or 21.8%, to $7.6 million for the three months ended June 30, 2024 from $9.7 million for the same period in 2023, due to a decrease in amortization expense related to definite-lived intangible assets in connection with the USAA and NEC acquisitions.
Previous wording
Three months ended March 31, 2024 compared to March 31, 2023. The change in value of consideration payable for acquisition of business increased $4.8 million as a result of an increase of $12.2 million in the fair value of contingent consideration associated with the WestEnd Acquisition for the three months ended March 31, 2024 compared to increases of $4.3 million and $3.1 million in the fair value of the contingent consideration associated with the USAA AMCO and
Current wording
Six months ended June 30, 2024 compared to June 30, 2023. The change in value of consideration payable for acquisition of business decreased $4.9 million as a result of an increase of $4.0 million in the fair value of the contingent consideration associated with the WestEnd Acquisition, for the six months ended June 30, 2024 compared to increases of $6.0 million and $2.9 million associated with the USAA AMCO and WestEnd Acquisitions, respectively, for the six months ended June 30, 2023. Refer to Note 4, Acquisitions, for further details on the fair value of contingent consideration payable.
Previous wording
Three months ended March 31, 2024 compared to March 31, 2023. Acquisition-related costs were $1.0 million and $2 thousand for the three months ended March 31, 2024 and 2023, respectively. Acquisition-related costs for the three months ended March 31, 2024 were primarily due to legal and professional fees.
Current wording
Three months ended June 30, 2024 compared to June 30, 2023. Acquisition-related costs were $3.0 million and $16 thousand for the three months ended June 30, 2024 and 2023, respectively. The acquisition-related costs for the three months ended June 30, 2024 related to legal and professional fees associated with the Amundi transaction.
Previous wording
Three months ended March 31, 2024 compared to March 31, 2023. Restructuring and integration costs for the three months ended March 31, 2024 and 2023 were $0.5 million and $29 thousand, respectively. Restructuring and integration costs for the three months ended March 31, 2024 were primarily due to personnel restructuring.
Current wording
Three months ended June 30, 2024 compared to June 30, 2023. Restructuring and integration costs were $0.1 million for the three months ended June 30, 2024 and were related to personnel restructuring. There were no restructuring and integration costs for the three months ended June 30, 2023.
Previous wording
Three months ended March 31, 2024 compared to March 31, 2023. Interest income and other income/(expense) was income of $3.6 million and $1.5 million for the three months ended March 31, 2024 and 2023, respectively. The increase is primarily due to an increase in dividend income and an increase in the net unrealized fair value of deferred compensation plan investments over the comparable period.
Current wording
Six months ended June 30, 2024 compared to June 30, 2023. For the six months ended June 30, 2024 and 2023, interest income and other income/(expense) was income of $5.1 million and $3.5 million, respectively. The income for the six months ended June 30, 2024 and 2023 was primarily due to dividend income and an increase in the net unrealized fair value of deferred compensation plan investments.
Previous wording
Three months ended March 31, 2024 compared to March 31, 2023. Interest expense and other financing costs increased $2.2 million to $16.5 million for the three months ended March 31, 2024, compared to $14.2 million for the same period in 2023 due to a higher average interest rate over the comparable period.
Current wording
Three months ended June 30, 2024 compared to June 30, 2023. Interest expense and other financing costs increased $1.4 million to $16.3 million for the three months ended June 30, 2024, compared to $14.9 million for the same period in 2023 due a higher average interest rate over the comparable period.
Previous wording
Three months ended March 31, 2024 compared to March 31, 2023. The effective tax rate for the three months ended March 31, 2024 and 2023 was 22.5% and 20.4%, respectively. The increase was primarily due to changes in the levels of excess tax benefits on share-based compensation and non-deductible expenses over the comparable period.
Current wording
Three months ended June 30, 2024 compared to June 30, 2023. The effective tax rate for the three months ended June 30, 2024 and 2023 was 22.5% and 24.0%, respectively. The effective tax rate for the three months ended June 30, 2024 was lower than the effective tax rate for the same period in 2023 due primarily to increased excess tax benefits on share-based compensation.
Previous wording
Adding back share-based compensation associated with equity awards issued from pools created in connection with the management‑led buyout and various acquisitions and as a result of equity grants related to the IPO.
Current wording
(5) Adding back stock‑based compensation associated with equity awards issued from pools created in connection with the management‑led buyout and various acquisitions and as a result of equity grants related to the IPO.
Previous wording
The balance at March 31, 2024 represents the Company’s $99.9 million revolving credit facility and a $0.1 million standby letter of credit used as collateral for THB’s real estate location.
Current wording
(1) The balances at June 30, 2024 and December 31, 2023 represent the Company’s $99.9 million revolving credit facility and a $0.1 million standby letter of credit used as collateral for THB’s real estate location.
Previous wording
We manage our cash balances in order to fund our day-to-day operations. Our accounts receivable consists primarily of investment management fees that have been earned but not yet received from clients, income and other taxes receivable, and amounts receivable from the funds. We perform a review of our receivables on a monthly basis to assess collectability. We maintained a $100.0 million revolving credit facility at March 31, 2024 and December 31, 2023 (under the 2019 Credit Agreement) which had approximately $100.0 million undrawn as of March 31, 2024 and December 31, 2023.
Current wording
We manage our cash balances in order to fund our day-to-day operations. Our accounts receivable consists primarily of investment management fees that have been earned but not yet received from clients, income and other taxes receivable, and amounts receivable from the funds. We perform a review of our receivables on a monthly basis to assess collectability.
Previous wording
The deferred gain on the termination of the Swap is being amortized on a straight-line basis through July 1, 2026 and is included in interest expense and other financing costs on the unaudited Condensed Consolidated Statements of Operations. As of March 31, 2024 and December 31, 2023, the unamortized deferred gain on Swap monetization was $37.5 million and $41.6 million, respectively, before tax.
Current wording
The deferred gain on the termination of the Swap is being amortized on a straight-line basis through July 1, 2026 and is included in interest expense and other financing costs on the unaudited Condensed Consolidated Statements of Operations. As of June 30, 2024 and December 31, 2023, the unamortized deferred gain on Swap monetization was $33.3 million and $41.6 million, respectively, before tax.
Previous wording
For the three months ended March 31, 2023, the Company reclassified income of $4.2 million, respectively, from accumulated other comprehensive income (loss) to interest expense and other financing costs on the unaudited Condensed Consolidated Statements of Operations as a result of changes in the fair value of the Swap.
Current wording
For the three and six months ended June 30, 2023, the Company reclassified income of $4.7 million and $8.9 million, respectively, from accumulated other comprehensive income (loss) to interest expense and other financing costs on the unaudited Condensed Consolidated Statements of Operations as a result of changes in the fair value of the Swap.
Previous wording
At March 31, 2024, the Company had $149.4 million in contingent consideration that is estimated to be payable over the next year and three years resulting from the WestEnd Acquisition. For the three months ended March 31, 2024, the Company recorded an increase of $12.2 million in the contingent payment liability associated with the WestEnd Acquisition, which is included in consideration payable for acquisition of business in the unaudited Condensed Consolidated Balance Sheets. In March 2024, the Company paid $80.0 million in cash to sellers for the first WestEnd earn out period payment. At March 31, 2024, the estimated fair value of the WestEnd Acquisition contingent payments was $149.4 million, and a maximum of $240.0 million in contingent consideration ($80.0 million per year) is potentially payable to sellers.
Current wording
At June 30, 2024, the Company had $141.2 million in contingent consideration that is estimated to be payable over the next year and three years resulting from the WestEnd Acquisition. For the three and six months ended June 30, 2024, the Company recorded a decrease of $8.2 million and an increase of $4.0 million, respectively, in the contingent payment liability associated with the WestEnd Acquisition, which is included in consideration payable for acquisition of business in the unaudited Condensed Consolidated Balance Sheets. In March 2024, the Company paid $80.0 million in cash to sellers for the first WestEnd earn out period payment. At June 30, 2024, the estimated fair value of the WestEnd Acquisition contingent payments was $141.2 million, and a maximum of $240.0 million in contingent consideration ($80.0 million per year) is potentially payable to sellers.
Previous wording
Operating Activities – Cash provided by operating activities during the three months ended March 31, 2024 was $68.7 million, compared to $64.2 million of cash provided by operating activities for the same period in 2023. The $4.5 million increase in cash provided by operating activities was primarily due to increases of $6.4 million and $1.4 million in net income and working capital items, respectively, partially offset by a decrease of $3.3 million in non-cash items.
Current wording
Operating Activities – Cash provided by operating activities during the six months ended June 30, 2024 was $148.4 million, compared to $141.6 million of cash provided by operating activities for the same period in 2023. The $6.8 million increase in cash provided by operating activities is due to a $24.0 million increase in net income partially offset by a $16.5 million decrease in non-cash items.
Previous wording
Cash provided by operating activities during the three months ended March 31, 2023 was $64.2 million and consisted of $49.3 million of net income and $30.1 million of non-cash items, partially offset by $15.2 million in working capital items.
Current wording
Cash provided by operating activities during the six months ended June 30, 2023 was $141.6 million and comprised of $105.9 million and $54.1 million of net income and non-cash items, respectively, partially offset by $18.5 million in working capital source of cash.
Previous wording
Cash used in investing activities during the three months ended March 31, 2023 was $1.5 million and consisted of net trading activity of $1.0 million and $0.6 million of property and equipment purchases.
Current wording
Investing Activities –Cash used in investing activities during the six months ended June 30, 2024 was $1.5 million and consisted of primarily of property and equipment purchases of $0.7 million and $0.8 million of net trading activity.
Previous wording
Financing Activities – Cash used in financing activities during the three months ended March 31, 2024 was $111.3 million and was mostly attributable to payment of consideration for acquisition, payment of dividends, payment of taxes related to net share settlements, and repurchases of common stock of $80.0 million, $22.4 million, $6.0 million, and $2.9 million, respectively.
Current wording
Financing Activities – Cash used in financing activities during the six months ended June 30, 2024 was $151.4 million and was mostly attributable to payment of consideration for acquisition, payment of dividends, repayment of long-term debt, repurchases of common stock, and net activity related to stock-based equity awards of $80.0 million, $46.4 million, $9.5 million, $5.1 million, and $9.6 million, respectively.
Previous wording
Cash used in financing activities during the three months ended March 31, 2023 was $62.5 million and was mostly attributable to repurchases of common stock, payment of dividends, and payment of taxes related to net share settlements of $34.4 million, $22.1 million, and $7.7 million, respectively.
Current wording
Cash used in financing activities during the six months ended June 30, 2023 was $132.0 million and was mostly attributable to repurchases of common stock, payment of dividends, and net activity related to stock-based equity awards of $79.9 million, $43.6 million, and $8.5 million, respectively.
Showing the first 40 of 41 pairs. Open the source sections for the rest.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Net outflows were driven by our U.S. mid cap, U.S. small cap, and U.S. large cap equity strategies, our fixed income strategies, and our Solutions platform of $0.7 billion, $0.2 billion, $0.2 billion, $0.2 billion, and $0.2 billion, respectively.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
WestEnd Acquisitions, respectively, for the three months ended March 31, 2023. Refer to Note 4, Acquisitions, for further details on the fair value of contingent consideration payable.
Previous report — wording carried elsewhere
Financial Condition and Results of Operations in the Company’s Annual Report on Form 10-K. A complete description of our significant accounting policies is included in our Annual Report on Form 10-K.