Victory Capital Holdings Inc
For the period ended Sep 30, 2024. Filed Nov 8, 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.
Sep 30, 2024 · Filed Nov 8, 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 2024-06-30; filed 2024-08-09.
0000950170-24-094388
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-09-30; filed 2024-11-08.
0000950170-24-123762
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 142 previous paragraphs and 148 current paragraphs.
86 unchanged; 52 reworded; 10 added; 4 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 18 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 (10)
Current report
Amundi US Contribution -On July 8, 2024, the Company, Amundi and, solely for certain provisions thereof, Amundi S.A., (“Amundi Parent,” and together with Amundi, the “Amundi Parties”) entered into the Contribution Agreement, pursuant to which, upon the terms and subject to the conditions set forth therein, Amundi will contribute to the Company, all of the shares of Amundi US. The contribution will result in Amundi US becoming a wholly owned subsidiary of Victory.
Current report
Amundi US, based in Boston, Massachusetts, is a wholly owned subsidiary of Amundi, which is headquartered in Paris, France. Amundi US’s activities are principally conducted by its wholly owned subsidiary Amundi US, Inc. Amundi US, Inc. specializes in providing and distributing investment solutions to a wide range of clients and investors, including institutional investors, corporations, central banks, sovereign wealth funds, and individual investors.
Current report
At the closing of the transactions contemplated by the Contribution Agreement (the “Closing”), in exchange for the shares of Amundi US, Amundi will receive 26.1% of the Company’s fully diluted shares after giving effect to that issuance (the “Base Share Consideration”). This will be composed of newly issued shares of the Company Common Stock, par value $0.01, representing 4.9% of the number of issued and outstanding shares of Company Common Stock, after giving effect to that issuance, and the balance in newly issued shares of a new class of the Company Preferred Stock. The Base Share Consideration is subject to customary adjustments based on the level of client consents received, Amundi US’s net working capital, debt, cash and transaction expenses as described in the Contribution Agreement.
Current report
At the Closing, the Company and Amundi will enter into a shareholder agreement (the “Shareholder Agreement”), pursuant to which, among other things, Amundi will be (i) will be granted certain resale shelf and piggyback registration rights in respect of the shares of Company Preferred Stock and Company Common Stock issued to it under the Contribution Agreement (the “Acquired Shares”), and (ii) is entitled to nominate two members of the Board for so long as it holds a certain amount of the Acquired Shares. In addition, for a period of three years following the Closing, Amundi will be subject to a customary “lock-up” of the Acquired Shares (subject to certain exceptions) and a standstill, which among other things, prohibits Amundi from acquiring additional equity securities of the Company (subject to certain exceptions).
Current report
The Amundi Parties, the Company, and VCM have also entered into an Off-Shore Master Distribution and Services Agreement and an On-Shore Master Distribution and Services Agreement which will become effective on the date of the Closing (except with respect to certain specified provisions set forth therein, which became effective as of the entry into such agreements).
Current report
The Closing of the transaction is expected to occur during the first quarter of 2025 and is subject to customary closing conditions, regulatory approvals and regulatory authorizations.
Current report
AUM at September 30, 2024 increased by $7.4 billion, or 4.4%, to $176.1 billion from $168.7 billion at June 30, 2024, driven by market appreciation of $10.1 billion and net outflows of $2.6 billion.
Current report
Three months ended September 30, 2024 compared to September 30, 2023. General and administrative expenses remained flat at $14.0 million and $13.9 million, respectively, for the three months ended September 30, 2024 and 2023.
Current report
Three months ended September 30, 2024 compared to September 30, 2023. Depreciation and amortization decreased by $4.8 million, or 39.1%, to $7.5 million for the three months ended September 30, 2024 from $12.3 million for the same period in 2023, due to the write-down of a trade name asset as a result of a change in the estimated remaining useful life during the three months ended September 30, 2023, with no such expense incurred during the current comparable period.
Current report
Interest Income and Other Income
Removed paragraphs (4)
Previous 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.
Previous report
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 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.
Previous report
Interest Income and Other Income (Expense)
Reworded paragraphs (52)
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 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.
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 nine months ended September 30, 2024 and 2023 and cash flows for the nine months ended September 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 $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.
Current wording
Our Business – Victory is a diversified global asset management firm with total client assets of $181.1 billion, assets under management of $176.1 billion and other assets of $5.0 billion as of September 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 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.
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 September 30, 2024, our Franchises and our Solutions Platform collectively managed a diversified set of 126 investment strategies for a wide range of institutional and retail clients and direct investors.
Previous wording
Professionals within our institutional and retail distribution channels, direct investor business and marketing organization sell our products through our centralized distribution model. Our institutional sales team focuses on cultivating relationships with institutional consultants, who account for the majority of the institutional market, as well as asset allocators seeking sub-advisers. Our retail sales team offers intermediary and retirement platform clients, including broker-dealers, retirement platforms and RIA networks, mutual funds and ETFs as well as SMAs through wrap fee programs and access to our investment models through UMAs. Our direct investor business serves the investment needs of individual clients.
Current wording
Professionals within our institutional and retail distribution channels, direct investor business and marketing organization sell our products through our centralized distribution model. Our institutional sales team focuses on cultivating relationships with institutional consultants, who account for the majority of the institutional market, as well as asset allocators seeking sub-advisers. Our retail sales team offers intermediary and retirement platform clients, including broker-dealers, retirement platforms and registered investment adviser networks, mutual funds and ETFs as well as SMAs through wrap fee programs and access to our investment models through UMAs. Our direct investor business serves the investment needs of individual clients.
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 $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.
Current wording
We have grown our total client assets from $17.9 billion following the management-led buyout with Crestview Partners II GP, L.P. in August 2013 to $181.1 billion at September 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 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.
Current wording
AUM at September 30, 2024 and 2023 was $176.1 billion and $148.9 billion, respectively. We generated $6.1 billion in gross flows and $2.6 billion in net outflows for the three months ended September 30, 2024 compared to $5.1 billion in gross flows and $2.0 billion in net outflows for the same period in 2023.
Previous wording
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 wording
AUM at September 30, 2024 and 2023 was $176.1 billion and $148.9 billion, respectively. We generated $19.4 billion in gross flows and $5.5 billion in net outflows for the nine months ended September 30, 2024 compared to $17.0 billion in gross flows and $4.6 billion in net outflows for the same period in 2023. Net flows for the nine months ended September 30, 2024 were comprised of $5.4 billion and $0.1 billion of net long-term and short-term outflows, respectively.
Previous 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.
Current wording
43 of our Victory Capital mutual funds and ETFs had overall Morningstar ratings of four or five stars and 67% of our fund and ETF AUM were rated four or five stars overall by Morningstar. 46% 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, 73% over a five-year period and 77% over a ten-year period. On an equal-weighted basis, 48% of our strategies have outperformed their benchmarks over a one-year period, 63% over a three-year period, 58% over a five-year period and 61% over a ten-year period.
Previous 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.
Current wording
Total revenue for the three months ended September 30, 2024 was $225.6 million compared to $209.7 million for the same period in 2023. For the nine months ended September 30, 2024 and 2023, total revenue was $661.1 million and $615.2 million, respectively.
Previous wording
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 wording
Net income was $82.0 million for the three months ended September 30, 2024 compared to $52.0 million for the same period in 2023. For the nine months ended September 30, 2024 and 2023, net income was $211.9 million and $158.0 million, respectively.
Previous 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.
Current wording
Adjusted EBITDA was $121.3 million for the three months ended September 30, 2024, or 53.7% of revenue, compared to $107.2 million, or 51.1% of revenue, for the same period in 2023. For the nine months ended September 30, 2024, Adjusted EBITDA was $350.1 million, or 53.0% of revenue, compared to $310.4 million, or 50.5% 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 $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.
Current wording
Adjusted Net Income with tax benefit was $89.0 million for the three months ended September 30, 2024 compared to $79.8 million for the three months ended September 30, 2023. For the nine months ended September 30, 2024, Adjusted Net Income with tax benefit was $258.0 million compared to $230.9 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
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 wording
September 30, 2024 AUM compared to June 30, 2024 AUM. At September 30, 2024, our total AUM was $176.1 billion, an increase of $7.4 billion, or 4.4%, from $168.7 billion at June 30, 2024, driven by market appreciation of $10.1 billion and net outflows of $2.6 billion.
Previous 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 $0.7 billion, $0.2 billion, $0.2 billion, $0.2 billion, and $0.2 billion, respectively.
Current wording
Net outflows were driven by our U.S. mid cap, U.S. small cap, U.S. large cap equity strategies, alternative investment strategies and our fixed income strategies of $1.3 billion, $0.7 billion, $0.4 billion, $0.3 billion and $0.3 billion, respectively, partially offset by net inflows of $0.3 billion in our Solutions platform.
Previous 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.
Current wording
September 30, 2024 AUM compared to December 31, 2023 AUM. Total AUM increased by $14.8 billion, or 9.2%, to $176.1 billion at September 30, 2024 compared to $161.3 billion at December 31, 2023. The increase in AUM was due to positive market action of $20.3 billion partially offset by net outflows of $5.5 billion.
Previous 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.
Current wording
Net outflows were driven by our U.S. mid cap, U.S. small cap, and U.S. large cap equity strategies, and our fixed income strategies of $2.5 billion, $1.3 billion, $0.9 billion, and $0.6 billion, respectively, partially offset by net inflows of $0.4 billion in our global/non-US equity strategies.
Previous wording
The following table presents our GAAP results of operations for the three and six months ended June 30, 2024 and 2023.
Current wording
The following table presents our GAAP results of operations for the three and nine months ended September 30, 2024 and 2023.
Previous 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.
Current wording
Three months ended September 30, 2024 compared to September 30, 2023. Investment management fees increased 8.5%, or $13.9 million, to $177.8 million for the three months ended September 30, 2024 from $164.0 million for the same period in 2023 due to an increase in average AUM over the comparable period.
Previous wording
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 wording
Nine months ended September 30, 2024 compared to September 30, 2023. Investment management fees increased by $40.6 million, or 8.4%, to $520.8 million for the nine months ended September 30, 2024 from $480.2 million due to the same factors discussed above in the quarterly section.
Previous 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.
Current wording
Three months ended September 30, 2024 compared to September 30, 2023. Fund administration and distribution fees increased by $2.1 million, or 4.6%, to $47.8 million for the three months ended September 30, 2024 compared to $45.7 million for the same period in 2023 due primarily to higher mutual fund average net assets.
Previous wording
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 wording
Nine months ended September 30, 2024 compared to September 30, 2023. Fund administration and distribution fees increased by $5.3 million, or 3.9%, to $140.3 million for the nine months ended September 30, 2024 from $135.0 million for the same period in 2023 due to the same factors as discussed above in the quarterly section.
Previous 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:
Current wording
The following table presents the components of GAAP personnel compensation and benefits expense for the three and nine months ended September 30, 2024 and 2023:
Previous wording
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 wording
Three months ended September 30, 2024 compared to September 30, 2023. Personnel compensation and benefits were $43.2 million for the three months ended September 30, 2024, a decrease of $11.3 million, or 20.7%, from $54.5 million for the same period in 2023 mostly attributable to a decrease in acquisition and transaction-related compensation of $15.2 million for the three months ended September 30, 2024, compared to an increase of $1.4 million for the same period in 2023. Excluding the impact of acquisition and transaction-related compensation over the comparable period, personnel compensation and benefits increased $3.9 million, or 7.2%, 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 $26.5 million and $3.7 million, respectively, for the three months ended September 30, 2024, compared to $23.9 million and $3.9 million, respectively, for the same period in 2023.
Previous wording
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 wording
Nine months ended September 30, 2024 compared to September 30, 2023. Personnel compensation and benefits decreased by $8.7 million, or 5.2%, to $158.4 million for the nine months ended September 30, 2024 from $167.0 million for the same period in 2023 due to a decrease in acquisition and transaction-related compensation of $13.7 million for the nine months ended September 30, 2024, compared to an increase of $4.4 million for the same period in 2023, partially offset by an increase in variable costs such as incentive and sales-based compensation. Incentive compensation and equity awards granted to employees and directors were $74.9 million and $11.4 million, respectively, for the nine months ended September 30, 2024, compared to $67.1 million and $12.4 million, respectively, for the same period in 2023.
Previous 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:
Current wording
The following table presents the components of distribution and other asset-based expenses for the three and nine months ended September 30, 2024 and 2023:
Previous 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.
Current wording
Three months ended September 30, 2024 compared to September 30, 2023. Distribution and other asset-based expenses are primarily based on AUM. For the three months ended September 30, 2024, distribution and other asset-based expenses were $36.8 million, a decrease of $1.3 million, or 3.5%, from $38.2 million for the same period in 2023. The decrease is primarily due to lower platform distribution fees over the comparable period.
Previous wording
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 wording
Nine months ended September 30, 2024 compared to September 30, 2023. Distribution and other asset-based expenses were $109.6 million for the nine months ended September 30, 2024, a decrease of $3.6 million, or 3.2%, from $113.2 million for the same period in 2023 primarily due to a decrease in the same factors as discussed above in the quarterly section.
Previous wording
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 wording
Nine months ended September 30, 2024 compared to September 30, 2023. For the nine months ended September 30, 2024 and 2023, general and administrative expenses were $42.4 million and $39.6 million, respectively, for a year over year increase of $2.8 million, or 7.2%. The increase was primarily due to an increase in technology and marketing-related expenses.
Previous 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.
Current wording
Nine months ended September 30, 2024 compared to September 30, 2023. Depreciation and amortization decreased by $11.0 million, or 32.7%, to $22.7 million for the nine months ended September 30, 2024 from $33.7 million for the same period in 2023 due to a decrease in amortization expense related to definite-lived intangible assets in connection with prior acquisitions and the same factors as discussed above in the quarterly section.
Previous 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.
Current wording
Three months ended September 30, 2024 compared to September 30, 2023. The change in value of consideration payable for acquisition of business decreased $11.9 million as a result of a decrease of $1.6 million in the fair value of the contingent consideration associated with the WestEnd Acquisition for the three months ended September 30, 2024, compared to an increase of $7.6 million and $2.7 million associated with the WestEnd Acquisition and USAA AMCO, respectively, for the three months ended September 30, 2023. Refer to Note 4, Acquisitions, for further details on the fair value of contingent consideration payable.
Previous wording
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 wording
Nine months ended September 30, 2024 compared to September 30, 2023. The change in value of consideration payable for acquisition of business decreased $16.8 million due to the same factors as discussed above in the quarterly section. The change in the fair value of the contingent consideration associated with the WestEnd Acquisition increased $2.4 million, net for the nine months ended September 30, 2024, compared to an increase of $10.5 million, net and $8.7 million, associated with the WestEnd Acquisition and USAA AMCO, respectively, for the same period in 2023. Refer to Note 4, Acquisitions, for further details on the fair value of contingent consideration payable.
Previous 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.
Current wording
Three months ended September 30, 2024 compared to September 30, 2023. Acquisition-related costs were $5.1 million and $0.1 million for the three months ended September 30, 2024 and 2023, respectively. The acquisition-related costs for the three months ended September 30, 2024 related to legal and professional fees associated with the Amundi transaction.
Previous wording
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 wording
Nine months ended September 30, 2024 compared to September 30, 2023. Acquisition-related costs were $9.2 million and $0.1 million for the nine months ended September 30, 2024 and 2023, respectively. The acquisition-related costs for the nine months ended September 30, 2024 were related to the same factors discussed above in the quarterly section.
Previous 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.
Current wording
Three months ended September 30, 2024 compared to September 30, 2023. Restructuring and integration costs were $0.2 million for the three months ended September 30, 2024 and 2023, respectively, and were related to personnel restructuring. The restructuring and integration costs for the three months ended September 30, 2023 were due to the divestiture of certain INCORE accounts.
Previous wording
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 wording
Nine months ended September 30, 2024 compared to September 30, 2023. Restructuring and integration costs were $0.8 million and $0.3 million for the nine months ended September 30, 2024 and 2023, respectively. The restructuring and integration costs for the nine months ended September 30, 2024 were related to the same factors discussed above in the quarterly section.
Previous 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.
Current wording
Three months ended September 30, 2024 compared to September 30, 2023. For the three months ended September 30, 2024 and 2023, interest income and other income was $3.6 million and $1.5 million, respectively. The income for the three months ended September 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 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 wording
Nine months ended September 30, 2024 compared to September 30, 2023. For the nine months ended September 30, 2024 and 2023, interest income and other income was $8.7 million and $5.0 million, respectively. The income for the nine months ended September 30, 2024 and 2023 was related to the same factors discussed above in the quarterly section.
Previous 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.
Current wording
Three months ended September 30, 2024 compared to September 30, 2023. Interest expense and other financing costs increased by $0.8 million to $16.4 million for the three months ended September 30, 2024, compared to $15.6 million for the same period in 2023 due to the interest rate swap ("Swap"). For the three months ended September 30, 2024, the Company recognized $4.2 million of deferred gains from the Swap monetization, compared to recognizing Swap income of $5.1 million for the same period in 2023.
Previous wording
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 wording
Nine months ended September 30, 2024 compared to September 30, 2023. For the nine months ended September 30, 2024 and 2023, interest expense and other financing costs were $49.2 million and $44.7 million, respectively. The year-over-year increase is primarily due to a higher average interest rate and the impact of the Swap. For the nine months ended September 30, 2024, the Company recognized $12.5 million of deferred gains from the Swap monetization, compared to recognizing Swap income of $14.0 million for the same period in 2023. Refer to Note 9, Debt, for further details on the 2019 Credit Agreement, and Note 14, Derivatives, for further details on the Swap.
Previous 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.
Current wording
Three months ended September 30, 2024 compared to September 30, 2023. The effective tax rate for the three months ended September 30, 2024 and 2023 was 23.7% and 21.1%, respectively. The effective tax rate for the three months ended September 30, 2024 was higher than the effective tax rate for the same period in 2023 due primarily to lower excess tax benefits on share-based compensation.
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