Affiliated Managers (MGR) 8 Feb 212020 Q4 Earnings call transcript

Greetings, and welcome to the AMG Fourth Quarter 2020 Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Ms. Investor AMG. of Head Aggarwal, Relations for Anjali Thank you.

may begin. You

thank for morning quarter today to Good of us fourth discuss you the joining and for AMG's XXXX. results

the call, remind we A statements forward-looking replay these assumes differ our results Investor with today's release, that Before Relations of no like actual on could of make to our available call and I'd during of number along of begin, be this our which measures, earnings this reconciliation a a statements. materially on we from of copy obligation financial may including earnings a will and update website call. non-GAAP you guidance section any any AMG announced to

website regularly and our the Horgen, Executive the are addition, to Tom to consult President updated investors for company's turn this quarter Chief over morning With that, today In an results to posted we to site encourage Jay Jay. I'll and call With updated Wojcik, Officer. information. us investor the discuss Chief Financial and for our Officer; presentation

for investment-centric to independent our by scale. that That morning, firms and XXXX or transition divest the cultures Thanks, entrepreneurial principles. business others That this good generated of is number exit resulted period, competitors greatest to clients investment fundamental alpha scale, the and industry, and strong pursuing partner-owned managers and differentiated operating best AMG's businesses committed altogether. long-term everyone. execution while accelerated performance of and look opportunity and was strategy in year offer remained skill, investment an performance alpha. Complex with a growth. is the volatile AMG Anjali, markets consistent the investment active conditions about extraordinary of management across not our Throughout peers

on focused strategy discipline. and remain with we long-term executing our excellence result, a As

three-quarters of like our records, approximately on our distinguish EBITDA benchmarks cycles, market outperforming their on volatile Affiliates during periods performance built long-term are strong XXXX. ability long-term including Our demonstrating to an their Today, across themselves basis. products

global and evolve client their strong their in And growth, which abilities private with Our and past collaboration AMG, long-term earnings the in stronger value. we of this, AMG meet even enhance XXXX including welcomed substantial Affiliates events sustainable to in position an the shareholder often operate offerings, across Overall, product and business markets, flexibility than of year. momentum all entered areas needs. growth year, we equities. enter and emerged we from from capacity Affiliates to secular impact and in And with and also additional expanding meaningful unprecedented four new the significant our continue generate to XXXX of investing,

the our Turning of has as to XXXX, business with majority from business growth Affiliates, Since months. strong and results. well combined operational quarter, over our to and considerably, in the XX efficiency. collective EBITDA XX% large fourth second improving our earnings performance by growth taken our have in strategic power driven actions of impact contributed the increased actions driven of we reposition quarter and the fees, performance the of year-over-year These to the by fees of management in the as past investments

the course collectively repurchases, Square the a growth with Common, and partnerships investments shares over strong Comvest, more finish to year. XX% XXXX, of our free new cash fully our the capture across the the substantial and of and investment share significant strengthen heading In we markets, income further the and With market, than simultaneously in particularly and new contributor for capitalized to position were private and in areas second EBITDA million environment our of and growth. into to strong. These repurchasing of including power growth to more capital improve earnings had XXXX, results during also balance fixed sheet $XXX wealth more becoming flows profile. earnings our enhanced than flexibility specialty market business for We which, contribute and XXXX the performance our AMG activity overall magnitude do not of our Boston but one-thirds account significant are XXXX, combination client the benefit flow, tailwinds on a while half deployed a of management, of shareholders. business will Jackson our

improved performance equity generate organic opportunity fundamental strategies positioned fee enhanced are track and Our their increased and growth. better potential today, liquid to alternative given records,

flow new in contribution addition of In will the earnings momentum XXXX course of to building cash generation, the investments realized continue across we our these capital both in new be finally, given and repurchases. and investment deploy liquidity our Affiliates, XXXX expect investments incremental additional pipeline the timing over results, to of our to given the fully existing of significant our substantial our share year. XXXX, And the

year, ability and forward are our in we and these AMG’s generate earnings all share. as this enter meaningful to For confident prospects per reasons, of growth economic we

firms. AMG you is asset with in partnering know, As a independent leader management

evolve they investments, long-term over succession the we plan. Today, offer time. capital, We their our ongoing a uniquely grow independent firms, including and our growth approach distribution partnership support, of to for set businesses have meet to solutions broad needs continued minority Affiliates of as

and for innovator evidence success investing, new prospects Management, long their three has firms And solution joined reach significant impact managing expand reputation all designed across structures our given new of an in engaging universe and outcomes. firm, channels a middle-market, new We which investing to with valuations Asset growing our which in global focus resonate year. XXXX, credit in highest-quality in competitive differentiated Boston at high of on record range unique the track by evidenced Individually, returns breadth of Capital of independent partnership in distribution platform private imperative. Boston increasing, partnership broader on organic an Partners, remains demand new businesses industry and high-quality underscores Notably, and Common client sustainability a the address activity record investment relationships, across equity through focused and have set. With a us. Comvest world, as Affiliates allocation. which steadily time Across for position of around portfolios. -- firms increasingly women-owned Square private Together, investing. this and high. their client investing of Jackson proprietary our deliver increasingly included is asset an sustainable growth Our is following course is allocation. the these our over is Common power and area each a AMG’s customized geographies. global, ESG continues responsible to are Affiliates through investments AMG's Client increasing important disciplined with our our in equities a with are this to And management specialist long-term leader a Inclusive second the investing high-conviction moment sustainable approach impact the and Partners, and firms outstanding last for followed to with and appetite premier capital global investments prospective

responsible closely are to We offerings. product collaborating engagement particularly in increased Affiliates' their and capitalism, to respect with support participation

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and as human our long-term firms focused risk manage we to including in and will we results impact Affiliates years did assist successful past other for in their regulatory long-term that In Affiliates two fully upon and addressing XX enhance over to ahead. our in ourselves on AMG materialize addition in partner-owned manifest the operational, risks, our of have years. this to years capabilities Affiliates. in beginning to capital, four are period, AMG the and helping of position and of have they also build future, quarter the made grow Over investments fourth has offers for partnerships nearly the as growth we And the independent decades reputational invested three to time, ability the more support. In over sustainability strategic new

position. broadened the invested our realigned our offering. have We we We We partnership our We strategic capital the our existing Affiliates. with our enhanced of capabilities. platforms in solution enhanced and significantly growth greatest distribution opportunities,

entrepreneurial We reinvigorating organization. entire while this the an and have AMG's mindset of culture across all reestablishing achieved ownership

our in heightened XXXX, momentum Looking in ahead and to we strategy. business conviction significant have our

repurchases, initiatives value review we invest excess Tom the opportunity long-term quarter. AMG's shareholder to while With of flow, to us our earnings to clear I'll turn over we of share and increasing As time. into it generate is levels continue and over free details significant through deliver cash growth to capital the positions that, returning to compound capital that

everyone. good morning, Thank and you,

their flexible us producing value. partner-owned ahead increasing As longstanding XXXX of the disruption, At expectations across same a stronger industry creating opportunities Jay earnings the alignment future both on disruption more momentum and AMG's belief focused power discussed, against quarterly and unique to independent execution our in business, shareholder execute to We with is are taking time, generate for growth. and proposition earnings that firms value place significant the and strategy and our balance our with in clients. strategic sheet of considerable changes is significant results their in our our highlighting enter

from per billion AMG to from $XX.X of strategies quarter strength client quantitative contributing delivered of of grew quarter. that an and fees, investment XX% net for positive organic an increasingly and enhanced by benefited seasonal in environment management significant of EBITDA. activity. in accounted wealth strategies Adjusted were X% growth outflows $X.XX level in earnings performance active the and managers and quant year-over-year stabilization million of outflows to cash economic in Turning performance Affiliate and attractive strong trends taking of while repurchase seasonality, growth contribute flows flows share Strong increasing to driven strategies fundamental into net Quantitative to the and share client XX% and continued improve, across management rate alternatives, EBITDA fixed continue of certain account both Away further and income by an And specialty earnings client generated our drove run approximately earnings. equities. were for underlying driven redemptions. illiquid proportion the despite $XXX quarter. allocating our positive

been credit Turning Affiliates fourth momentum positioned EIG of growth, Overall, Affiliates. across Within our across alternatives, market Asia returns powder to post as In among has our to breakdown of million Pantheon, performance we build future liquid to the private equity, liquidity net at and billion which Baring, attractive our book allocations continue of markets Affiliates and opportunities, enter quarter produced across income redemptions to remains in and for by nearly offset class $XXX strategies challenged strong remains our windows. quarter, private globally. seasonal excluding our Garda liquid source with private in this management certain strategies, earnings interest the including our illiquid clients. quantitative and alternative fees deploying clients generated fixed of and fee and in alternative deliver markets strong alternatives, continue for value continues excellent dry Fundraising potential. a very in private return collectively into carried Performance co-investments strategies. XX% funds. been increase XXXX Comvest category strong others, ongoing have EBITDA our XXXX. ValueAct, and inflows in steadily as Strength fourth and significant was asset global strategies partially XXXX, alternative performance secondaries, to concentrated relative $X long-only well liquid majority reported in accounting reflecting

$X.X retail of in equities, $X.X fundamental equities net to partly global U.S. Moving we outflows equities, and reported due seasonality. the billion to impact in billion of

and We performance, continue organic active GW&K. positive top Loevner, in demand where quartile with including to Harding generate growth Veritas converges at for areas client

we long performance with supported is AUM across AMG muni given X-year and fundamental that strategies quarter and Street. level differentiated ability trends GW&K wealth XX% particular, Multi-asset where ago. macro areas anticipate benchmark growth. inflows, well $X.X strategies steady, to improved to client overall we future our are net of for duration for long-term increasing outcomes value trends and and with investment strategies, This the equity period, in client favorable fixed our significantly posted momentum are their positive driven organic business In coupled two environment generating for support Affiliates for area relative performance, positioned of time Our another continues broader Affiliates' active to positioned years more industry strong approximately superior our of regarding over deliver above our of a equity very seeing be bond generate solutions investing, income outpacing organic the performance. by growth, of strong aggregate, In continue have and billion deliver to clients. XX% at client investment inflows dynamics demand well in to future with we continues strong strategies ongoing by strong deliver demand And participation fundamental and flows conversations to Baker growth.

financials. to turning Now

For EBITDA investment corporate million purchases. Affiliates, by performance, investments driven $XXX a by activity, broad an performance of new expand repurchase in a the grew the from Affiliate $X.XX of alpha-oriented of year-over-year elevated million across of EBITDA fourth $XX driven XX% benefited investment higher share strong existing lower both strong including and Economic I'll impact in expenses share markets, Adjusted quarter, equity included growth performance of and strategies. array fees, per earnings further of level moment. on adjusted which

are performance With performance of XXXX full for $XX well our fees fee entering the growing represented earnings. area. of we million continued strength diverse approximately For and year, a this positioned XX% opportunity, in

first to quarter. items Now the for modeling specific moving

We expect which reflecting blend, was million the $XXX adjusted Friday. X.X% $XXX levels, based of AUM of to EBITDA range million market to on current be up in our as

includes to alternative range our performance seasonality strong estimate of fee $XX reflecting performance million Our at normal managers. and $XX liquid million, a

interest reflecting of offering. was Our for expense quarter, hybrid million of share impact $XX debt fourth the our the

We was fourth expect level a remain for quarter. we Controlling $X million and level the in expect first the interest interest depreciation similar to for consistent expense at quarter, first quarter. a the

for Our this $XX amortization the item impairments and million. the first of we reported $XX quarter. fourth million share quarter, was In line expect approximately to be

and quarter. effective rates GAAP XX% for the Our and tax fourth were cash XX%

items, to $X we economic million. Other other on For $X capital to XX% GP economic any and respectively, to in approximately included excluding and quarter, impact and million and quarter. cash were expect $X expect modeling for negative modeling and purposes, seed Intangible-related deferred in impact negative first first seed be purposes, deferred items GP on our the be million fourth investments. quarter. for XX%, we were GAAP and the the quarter, million intangible-related first $X taxes In the expect we taxes mark-to-market be tax rates the mark-to-market

for average quarter weighted count XX.X and to for XX was adjusted the share fourth million, first approximately Our we quarter. expect count share million be the

Turning to and sheet allocation. balance the capital

debt the XX share significantly liquidity debt enhanced our cost and favor repurposing capital our position, keeping taking years in Over the attractive we doubled issuing historically our improved XXXX, position the financing environment additional liquidity advantage dividend our capital to of our the to We building by of position continued junior company growth, flexibility repurchases. flexibility. debt including for of of of enhance and while of the course our unchanged, to duration hybrid by

the allocated a Affiliate into the repurchases. elevated new As confident XXXX, sheet growth four ability of free seed of We $XXX and excess our these cash return capital to In feel shareholders. return and is equity shareholders together And cash GP position we primarily discretionary growth investments an actions, and balance flow through and capital provided significant across combination partnerships, in heading generated business by excellent a growth of XXXX. our result in purchases to with toward Affiliate flexibility into invest significant commitments. for to by our of level simultaneously capital share invested approximately investments our cash million we flow,

the million repurchasing In performance tax and quarter strong million of second shares addition, we our $XXX repurchased XX% from of the additional in half business during fees XXX performance The least In year, of we our the shares million. at XXXX repurchased cash benefits. outstanding. reflect guidance of $XXX fourth of significant versus quarter, million the $XXX shares of and incremental in generated repurchases

capital Looking higher more capital liquidity repurchases a investments generation, fee cash and allocation rate shares, Affiliate level of increase ahead, by both year-end discretionary which In quarter, to repurchase million to of as run position, first and expectations. and our through performance quarter normalized strong to the position cash we the have million continue first the flexibility combination function return. is of growth expect of $XXX a we strong to our elevated approximately $XXX

Finally, year guidance. turning full to

earnings we business haven't position management the the strong fee in year performance power in both guidance markets, time, the move we full our share liquidity and increased repurchase equity basis, given fee While some and activity, guidance for a heightened sharp on earnings of XXXX. are given providing

we XX.X $XX, $XXX range performance expect adjusted range million. economic an capital our the into of range million, upside of second are I year to in of guidance, approximately provide performance market activity earnings average while a midpoint million share full new would $XXX reflecting through includes fee guidance impact The investments share our EBITDA of of subject of We note to of which in this the capital that count first given investments earnings $XX.XX per in timing to and to million quarter approximately weighted new including be a would investment are last Friday and excess incorporated X% and the to contribution and quarterly share starting through not market returned guidance. Both uncertainty, new conditions. XX% quarter, $XXX of and incremental earnings planning growth for year that is repurchases. market reflects earnings the prospects for forward

our a remained through existing supporting discussed, growth change, balance and our and excess our XXXX partnerships, with come deploy positioning year strategy more at growth was of even we and Jay to establishing our value unprecedented repurchases. to into compound Affiliates, conviction As shareholders. returning initiatives to for capital focused sheet and on future We earnings our in capital events XXXX new create for shareholders and ability growth long-term

Now questions. happy your take to we're

[Operator the Instructions] comes Our first Siegenthaler from Suisse. Credit Craig question of with line

type we pipeline can of of as have new both of So investments look transactions capital composition investments growth at talk you minority transactions, or that into? about the potential you and some majority your also been pivoting guys these

the you Craig. Yes. Thanks, Thank for question.

me majority this. start, I'll and aspects minority Let and get of growth and the to capital

like our model particular, support an a that made the since recent was we do to we partnering prepared that throughout -- our each thing I'll them reasons the businesses. the where different XXXX. Each of investment is, consideration, in us. said resonating. our new in we needs. of aspect part Comvest, most four I'd evidenced The represent investments of one and life in they quality, these of come capital as to the important with four. partner-owned is slightly firms. middle done of with whole It's was growth a the high and say And to opportunities, Obviously, offer businesses the are highest is First find think the In growth Affiliate's for that cycle remarks, case independent, that is by we've most we back Each moment. quality key of offer thesis,

and So support. majority more our liquidity; set investments, distribution today solution includes typically a growth is minority planning, succession for concept; capital; which investment

transaction you So global go have case, the at up recent the investments stakes. last look distribution time our the support, initial -- to on most each of framework, platform. advantage in each four all at have in distribution the across of our when to four of that these transaction taken the been investments, The signing minority

do on that we opportunity or versus I'll various a and they including that to our us of for we current would in the comments investments term. both, we really for other the at the I over to think do make both term. When the expect the Affiliates the some as I look at the and us. here, near new time, minority we look expect more maybe depends mix reasons, significant pipeline, was medium But needs prospects. have generally, over majority came of And pipeline

of especially resources We to the as attracting or mentioned, effort. prospects, distribution set, this either strategic in need have have We, wider capital I which solution more of put support. those is broader a universe

of and our through specialty given global We creating the proprietary management of proprietary all model seeing in seeing tailwinds, fixed last can pickup equities noting us on disciplined have and and or activity in a that where a worth great quarter. We're we've many goal the the using combination of the we is in and maintained number are a creating execute an are of interest advantage duration in and third actually independent risk do under relationships, the includes preserve model just -- enhance decade-long nearly focused own That that incorporating cost very and those us large income, our environment that multi-year partners aligns us, multi-asset we're being strong pricing of that metrics, a prospects. conversations, for growth. efforts independent, outcomes. since And is deals designed areas a And we've we've have It's a secular enables of and their areas private a businesses. in markets, of ESG, that have without that at in the probably we've increasing virtual of decade. extend firms as active relationships multiple it’s levels deals that we are the -- engagement also leaves a our seen internal calling These areas structures to with of number can for alignment greatest solutions. and our And even gives the participation year. time integration, number add value. And calls, mentioned we right to given a prices that several number

Our Fannon line comes of from next Dan question with the Jefferies.

a couple just questions So the of of terms in outlook.

to So first, write-downs quarter, in were then there of just I guess, items XXXX the of the some obviously one-off kind of that control or or or the momentum trying -- strength, And your control impairments to kind you in your fourth versus your separate terms some can that of beta addbacks? Affiliates kind of the of of terms the and business performance. in in of

that you improvement past of growth the think areas about year? most this of in could versus the kind you see XXXX incremental if opportunity as So highlight as organic terms of you

Yes.

and back, take question, circle you the maybe of for Tom part then Thank your to let going -- I'll first Dan. I'm So question. come I'll your

Thanks, Sure. Dan.

of to much and the here not impairment of to couple little level, for the wasn't saw going kind $XX look, on So guidance so a back quarter, really of quarter there in million the the meaningful first things anything our you and question, there. speak there,

in and color. remember, and growth, our compounding combination and But really the on opportunities, earnings by business, share organic to the new and us, count, share growth things, Jay it's ultimately, organic for our that both a that some touched growth kind areas to of well. performance in more capital of terms organic ability specifically performance growth, earnings investments fees to of a will then allocating our repurchases great of ability I'll through couple and be In make drive an an perspective as from you I'm give growth being driven performance and and going perspective overall sure growing

So areas areas translate beta, we're allocation our frankly, variety in in I performance are of business. to able a beyond a long-term growth into market there through where our think strong capital number of

the the growth where areas In markets strong times, and terms market of seen see And businesses significant seeing of continue rates actively opportunities, momentum, areas years, private of to EIG very in both prepared strong organically collectively those course businesses over the we given our flows Pantheon, fixed on to couple number alternatives, anticipate with and new are Comvest double-digit where businesses. like illiquid virtually to we those secular those income all the where fixed grow we I continue in remarks touched have of and funds diversity past the income. Baring Asia, and future. traditional be at the into at of Specialty Jay

in flows in. number We products excellent very of side, have to GW&K very then a duration have muni Capula. on where, an coming Affiliates again, areas. strong; Garda year, and who had long unique, high-performing in wealth again, management, those the continue we sticky, see

couple future where of spoke we're we our are of And think strong terms of business organic X-year this kind seeing in for trends being improving in to have about I core once in you growth That environment seasonality. the out as And positive of overall respect today, performance to active of our strong very good the believe in in terms tailwinds have the years. the my really remarks, fundamental and active prepared into with some book, the them the given that us strong above period, strong have, we opportunities over see we with strip we behind nice our for quarter. quant as flow are was book. assets been future. number more We that to over very anticipate performance well, coupled equities as last areas you than those Jay mentioned So equities the and do that XX% benchmark the starting active and

a Dan. if Maybe summary. good add things here, to a Yes. That had few I was

on our underlying work First that require recognize the growth look, business. flows more the to is, do of I top-line you

that, that, recognize seen we're we and from to because get you was and Affiliates, some business expect they our we that of our those have really flows trying really -- and mentioned amounts see really to level. different have would but is, in what the to just rest So help hard we structures. seasonality, Tom and different from there own of quantitative is -- positive But away obviously, territory. away

So of them some -- and often performance offer fees.

So here, medium-term if fees. AUM levels our near perspective, significant generate can is management which maybe which I are highs a share

the have and new in guidance turned had those in until seen investments positive fourth and won't that's non-quant our quarter Our effect in for We XXXX, be amounts. the seasonality. ex flows XXXX, full

given alternative in of of the our high assuming be products, a Frankly, that. watermarks, some than the in performance fee. XX% greater it -- much kind We are could given growth

the then with new investments new we kind or you If assumptions, the centered management the economic and purchase be more a of of performance where of fee relatively range. top look just kind capital our level you'd that carryover fees, modest have in normal really per where have shares you XXX-ish fees, at reflect If convention we're EBITDA modest earnings higher what share, seeing in at the Tom in of investments effect deployment. of and $XX.XX of performance we midpoint very looking does of

the see the obfuscating It's because of underlying So quant have is just of benefit think to it significant the the is the the we hard of business. immateriality that AUM growth I of do organic growth. managers

Bill of next line comes Our from the Citi. question with Katz

just the go Maybe other way.

business happened well? the platform deals year little question. some of underperforming value the sort deals other of can just XXXX, at into concept SPACs And the enclosing you you X-part sort sort of to look as some pricing get the in of as that investors potentially One a given the by what's help then to talk of seeing your the selling that some happened is, Affiliates? of have as maybe last of bit, the fundamental As a company, and strategic well to trying

good going we're that some clients maybe is obviously, the active best, some by in active And passive. around you. place and be is of Bill, partner-owned that which Thanks, high Yes. partner our the be flows to very even experienced will we Look, morning conviction where where think on We outperformance it's seeing, independent firms. have is to strategy, of that, momentum and away from the choice towards -- world.

that's seeing. And something that so we're

that of execute investing with of still high strategy to Affiliates. respect existing to have business in growth in front us investing We our in conviction the Affiliates, continuing by is new our

headwinds. were heard those That's is different really the dozen largely address so lead behind that about by us of ago, years with and not Affiliates to we now. to AMG, the half that us two worked resolutions now It you've years, with headwinds our it because is partners, ultimately driven did we was think facing that and for behind and strategically. say, ultimate partnerships, us. or issues But work two through to a I engaged

I free that and opportunities. us our think to capital for resources up allowed growth

of some XXXX. through and that seeing in through see think come You're of some results our our that come now, I results you'll

have our last in over years with that three the Affiliates, we've as as profile we the two, As stable far evidenced and how of business, tremendous we diversity our back have. come

in us. is anyone the take That we We ultimately, and permanent Affiliates a our And There us, what's value to that's else is market. shareholders. have drive we uniqueness chosen that, isn't permanent -- partnership approach. a for think are going like why really that think we

with line Davitt comes question the from next Patrick Research. Autonomous of Our

So you flows the investment timeline experience mandates maybe based and made, on doing of new in the frame kind the getting what global distribution seeing for global of incremental fair help have distribution. you that, being a past plugging new maybe amount plugged is us from then from investments that? seeing into result of new Could

Patrick, morning. and Thanks, Yes. good

that a look, at at help purpose-built offering of Affiliates complementary exist AMG but scale. AMG, have we individual also efforts So Affiliates to our to by sales it's those combination excellent the augmented distribution the that

We $XXX know we billion, million you client centralized -- billion than excuse for $XXX Affiliates product ago segments. across more XX, our this, raised XX now. types me, think our started $XXX distribution years I and

So for each these for Affiliates time, us in of started have and Comvest. we It and a already a raise come does assets take new little to COVID online. have down raised slowed bit but XXXX, assets. Garda We've

Jackson Boston Both be Common joined and there. case. mandates have we'll platform, Square in have each their our supporting efforts retail and We retail

generate to of four So for those in relatively we short do flows Affiliates all expect period. a

the But past that's think in years. made those that doing over the work AMG. to incremental I two why maybe of at think me we're mention from adjustments see months flows and we number let next each in the we year case from I also expect flows of because would a

think facing this ago Affiliates mentioned our certain addition in talked I working about a in of well we've I to as moment with that headwinds.

We aren't areas also areas that adding on are. in and adjusted strategy pulling resources our areas approach focus own evolved our those are growing, resources away and that platform to really and to market from the that to

offering ESG added in offering; private So Common, on the for our side. broadened institutional, alternative with We've Boston be and we'll an example, product. market we've resources

-- look into, think to that we grow. would searches open We at to resources to have regions going we of areas more continue for new kind and the we also are in that we want do go

So are those growth putting effort initiatives. we more towards

these that Affiliate Affiliates So in existing four confidence our gives us well adding as as base.

institutional in it's partnership and retail on with sale, really We forward huge retail again to to channel us added drive ultimately, sales where we've the wirehouses office value. for to a continue that to U.S. actually also and then, support. plug the U.S. the push us an struck the retail is On going we're the technology alternatives. help U.S. in believe really to side, a resources wealth We've into iCapital need you opportunity and home and

flows relatively do from make your more see hear more going to Affiliates I over each likely these of But You'll this. the details. as on And period. short question, original we us give we'll you progress, back for

of the Our with Goldman Alex next question line Blostein comes from Sachs.

guess, pinpointing it -- kind a company, but -- single to help market aspiring of is to strong more be EBITDA hoping is this Affiliates? like of you have you're the either kind growth AMG sort was of of a performance that again, EBITDA profile guys kind and difficult, momentum maybe impact growth growth given next the try excluding to so of understand organic longer-term the 'XX, to the existing understand over evaluate organic business, I in company for the expected years? several any what for can I the discussion you growth I of as of And can of what to out like us or organic ultimately purchases little new the investors round and be year might

that. Very answer, nuanced I'll a Alex. I'm thanks, Tom, it complicated let give question but So shot. to you to going and Tom let answer

Sure. Thanks for your question, Alex.

businesses. So look, particularly the sizable a comp an organic a Affiliates. variety lot also, one. in lot that, business ours, a EBITDA our a performance goes for to we obviously of we have do growth a There's frankly, have important different fee that where structural and component like underlying And these ownership of into is stakes

something think So think into. it's it's as you not can mix about business, probably visibility our some of that a but you the stat that get disclosed, overall I we've

about much then, strong a last basically we've early this where quant today, while of obviously, continue couple I'd is challenged we're outflows I'd the our only note If the rate of that to run has been you half the outflows that think again, quant base. of And out from any smaller cut XXXX And also in activity the side. here pointing peaked majority XX% there. strategies, of quant meaning AUM of worth we was a basis. some also seen in on off and came in coming that on seeing to performance that stand pretty just note is since our EBITDA it quarter restate, X% flow be that months

that So going hopefully, we forward. on can build

where in broadly into importantly, of the and fixed partnerships. can as shape we areas as both specialty we're our we've If of sort areas at growth think we also And I think in global those wealth past, impact you continues I very without terms of to noted earnings records at a the really as being of think then asked know the strong track management very I then thesis strong overall the performance across but platform, are when areas kind our as prosecuting provide about look investing leading value but growth with secular we delivering overall including fact of ESG, to and about grow of bring they where to of businesses that today. partnering then just the a income, you our about illiquids, liquid you and the future. EBITDA businesses given that that's in new don't a Affiliate management the AMG clients, we're and we proactively And this, investments, to proposition similarly, where emerging business. the third trends, percentage places our that think exclude that have similarly, you organic continues of really active to base, see can to It alternatives, look strong look all more like market equities,

where their So organic kind the and business, in all position when growth, over very should we you the put areas feel of think the the of you our things you Affiliates look be over shape demand AUM, together those our the will, those to investment cetera, of and long-term. a in performance drive long-term, et trends operate, client strongly at EBITDA I if intermediate overall to that footprint,

well kind benchmarks three-quarters And well short-term our of a positioned fundamental in we're similar and think strong of They the distinguished even periods on as a of alternatives Yes. X-year on X-year. look, basis, the in beating XXXX I in equities volatility. because themselves are

they're positioned well So growth. really in take to organic

specialty private Of our businesses now. course, some have we our also our fixed strong and wealth for income mentioned markets, that been time

here, favor, is see is pretty It basis. when actually, think flow number, just of On I it EBITDA like looks be turned mix obviously, be on so an the headline didn't, could EBITDA it optimism And the question close. the you in mix fourth quarter. first the and that's year. could could turn for it it's on basis, reason an it, a which it it And but in this does the quarter,

Robert of with Our next KBW. comes Lee line question the from

I permanent Jay, others some curious, I differentiate you maybe about -- guess, how from the The solutions. talked in marketplace, just mean, you

was some of -- for to revenue pardon a Some for investments mean, a shares say, need of going see of some at have whatnot other it been a now, competitors you see fine as in while while. have to and a other sell who starting those those permanent But managers It's others me, been [indiscernible] all I forward? of we out are are maybe done was." "Hey, funds or -- do to potential solution there those starting now. multiple source acquisitions. that place That that some more what you

your for Rob. Thanks Yes. question,

to just management, Let I because lot industry too, and get to right I'm take think that structure because I activity throw if an it's overall is actually it. of happen to question. transactions that can failed in in I the going to important in here, our now. think a asset mention earlier going But question. realized me I I'm try pricing I address that and to that there in universe of

entire way are are it. knows with everybody supports that very to firms think those cycle. There some who business model to partner-owned focused There we them independent I people on invest trying through our and with people who a some the are consolidate. are firms Obviously, in and our are align divesting. life

to only be of chose they really not did consolidated. because marketplace. They is So the of us wanting consolidation. see in transactions subset that a don't Affiliates our level a We want

that just And see the types on for to we business and really don't those side are of transactions want our probably appropriate so affect I don't that leave because us.

the turn that to keys else, to do. not wants we So a might would really that's transaction a be that firm independent who someone over

place. So that's I think the starting

out, of we're I independent we and remain independent. do the else. but have into firms sell want who illiquid a don't to into that group who separate population of everything to the of Now segment myriad want will competitors, managers There,

few to either say, business not have of or is today. us I for there our traditional been competitors set the because are very focus their else, Most opportunity decided competitors continue on if So competitive great or consolidated, me everything extremely selling bought, assets. let

approach Because illiquids, non-illiquid differentiated market, the of pricing side So There stake take very that tend approach. little can supporting be term growth. area, -- are seeing to their in that we turn is and that, those of number we -- attractive the a passive, and in for for are I and think just of a that. described. We're very attractive know named say stake. the a GPs space. them. Structure which return to are illiquid They you've us, to there We of very at competition. to and cycle of to a they're buyers, a a very very I financial fast-growing is one we partners all And When take sheet is understatement. we're XX% all and you life just very stages I is complete names recognize

just we small by portion of need So selected partnerships for tend to the than more be liquidity a or want GP. that

So of as Baring Comvest, price. when reason addition case situation, in to in in therefore, us those that we these in cycle. case our do companies And direct answer those the We to about And turn in relative being for that part to of selected your buyers. question may other stake valuations chase of case not is, stake just EIG, of portfolio we when area. different of this buyer AMG Asia, yes, their a get it life to is some we are We in for Pantheon, case who the the select differentiated possible think obviously disciplined. do offering it's see

for committed then mentioned, go industry, So we've way opportunity resources. the us because for very I still opportunity back is fragmented it’s large. the up, -- a And as more

relationships. proprietary have we and solution, broader this have We

our 'XX an of see business beyond. EBITDA increasingly we and So this of important our driver in growth aspect being

of Bedell Our Bank. the next line with Brian Deutsche comes from question

outflows get rate, about my think, I last asked that, in into that XX are in also looks points? over quantitative that I the in improve questions -- coming and low a the have Tom. three the at on improving shift the fee quarters, EBITDA of XX corporate EBITDA It's given you that from expenses get do mentioned, fee further very I in terms been of to basis points basis from outlook like as we XX confidence just basis But rate. what's one core your might 'XX. a guess, lower XQ. answered. Most been points know just mix Maybe we positive the

how also did fourth AUM sense coming a get to trying anything then in much I'm just in Jackson if not add was for Square, for sure they So through that? the else that. quarter? XQ And of

Great. Brian. Thanks,

few me Let hit and a those. of try

positive equity areas our rate, the secular fixed by some be fee and And outperformance Affiliates us. frankly, terms seen our if at Veritas, like that and you to in income. mentioned think of point Loevner markets of of overall management and have a lot will, We think, for expenses. in relative like trends Also, positive core strength continue of of I you being illiquids value active some also, driven around that strength Harding in those I the quite some growth

look talked in resources the are of think, of lean put business. we've really we sure times we're a a hard number I at And use, making As very very up terms running, about the our I and growth. we're think and past, today driving against that toward all highest in taken best of the

think right the all of And should I like think, we are in business direction. those type I hopefully, moves that continue see they forward. trends So feel same the moving as impact to

excited quarter. billion AUM. in again, And Square, about that was Jackson through the That of incredibly through about well, only partnership. $XX we're our to was terms thing very continues the running business came perform and that that In

from America. comes line Carrier of the of Mike Bank question next Our with

maybe you the color growth, 'XX, some around 'XX given your of rate and some revenue guidance, or color bit and for the fees nuances full a whether growth you the organic base growth? so Just XQ given in see? that just guys XQ can year the heading strong performance XQ organic in asset versus provide 'XX, more fee into on And

Yes.

take just So the incorporate you just of just some why I don't our given that mention the that? of of you first into would to reporting quarter in Affiliate perspective timing question. yes, when we the have Tom, also all

Sure.

a net couple again, of to maybe of somewhere performance tend XX%, at contribute fees year start. a very XX% of XX%. They So in and here. our base with a We the And little noted we sort diverse Affiliates. generally of of from midpoint guidance words at economic we've on neighborhood bit of and fee performance a the income, just do some upside have around to that generative of last ahead were range we in think

long-only, of into and good come you and a for contribute. strong build who buckets: both very where Systematica, opportunity quarter. to impacted volatility; illiquids, will absolute deliver a first its performance side performance, we different have return year, ultimately, businesses be year-to-year, visibility of couple of continue on security And again, performance very that's interest in biggest very terms this a as the and can recent diverse the book have over kind be did like and then You this who by selection We've think got performance of we differentiated pretty into tend three excellent up very and do ability in quarter then, that we our of a to guidance But the fees Garda, liquid we carried a tend have Affiliates strong give been have to fees. which And will Affiliates really quarter us. put alternative bank base first generative believe to amidst markets; which we'll include strong be that performing performance a seasonality to crystallizations. an some variety we the see well combination about concentrated for Capula, we right, performance, That long-term, similar times from longer-term strategies, diverse the fourth quarter our of fourth fee year. where year,

as strong that in touched rate your results of today. got in run you've it of our provided. number really, of obviously, and benefit think a we terms in it, to a managers active Q&A year. prepared the obviously, that from of I In things we're in seen performance through that and other of On the One, lot seeing as But growth, remarks will questions, And very markets our fees. of some half quarter, the our above back in beyond the think into in underlying today. continue AUM to both on we strong outperformance for full first the come the top right? what saw, happening experienced performance things like of very We've a that, market Much and we've in of both the business, of have about of well into some our are combination year.

toward You're year allocation Square, of noted where this seeing end those happened partially the of last investments, overall impact into entered A back with Common. of that towards we our in of Boston new Jay the beginning of in Jackson very year. transactions the also capital year the sort the the couple of

So of our the will of per to the impact going to over an be repurchases then share see the those share through impact we're economic continue full And obviously, basis flow year. a earnings tailwind. continued on

benefits positively. very capital Jay ability across more that's questions, allocation of number beta from into referenced the to a growth strength one of So as the well that well of strong can remarks, that of in trending as the you potential what compounding reference a both areas our earnings as you're as think and more seeing drive prepared of business in our organic the have stable in combination growth both it you're been in organic our are a sort for other then and exactly areas seeing. previous that and businesses, and our we future power of And growth. are strong our in seeing number as heard I Affiliates’ I strength And really translate the of I

generation just coming So overall, are year, flow perhaps, coming in as as rate I we bullish the run into and the momentum of momentum our our importantly, cash and think terms into very well. year earnings significant

year, content that through we actually really I improved to in tax they look, we came we many our we on that didn't shares -- of did, in remarks, just up to the earnings the have the but $X just sheet year. fourth at it. it but last fortuitous the savings, right significant more accounts XXX we're think then do maybe And the you of sheet. of ultimately balance today, of We if section billion look elevated us our north. XXX, bank sheet. some which our or don't our balance our which to we did hit really cash get from of And balance going we and something share balance questions end equivalents you cash, buying sheet the in we doubled actually indicating this, because we're Yes. ended good that's led very duration We -- some into repositioning We which added the our equity with economic And was prepared performance. our repurchases quarter, why towards to

number it's that's increase in year. we into our investments both our said, And Now first this budgeting but half numbers. our of about as like half that not allocated as is ours. Tom to, all but we a obviously, Typically, growth it’s the year, ours, not would significant flex which in this we've

than is Just Sure, for to that. the in quarter XXX that? could Could expect more be elevated our is be something the it in it it first an neighborhood with clear, not more what numbers. And than of year. then do we be

even momentum we've of So the is the given to there real our range that given, business. upside

comes this Shutler Our question with Blair. William from Chris of the line final morning

one, And been the are guidance. are in But given and in deal blend the first wanted a yourself valuations get opportunities right can just other they're quarter. from you that using market space? then wealth the did management for ways just since I It's I Or tricky seeing to you while the space, there another to the quick a buyers now alternatively, distinguish know there on be competition. all any there?

up one, follow the on market on can So first maybe Tom, let you the take me one. that,

a in very are active an have your investment investment. They in We Partners], for thanks Chris, actually to businesses. still We at are question. acquiring. continue very looking yes, [Wealth So active minority Capital wealth

so from And growth well. we've actually their benefited as

We have pipeline. had some in our

We pipeline. to in continue some have our

being strategy. larger interesting, of valuations though, part high tricky. in that What's and the part of price the needs of ones, right, are is You're of roll-up kind different some a scale kind are for than

extend while sort other concentration are focused is that some we that our illiquids we maybe are ESG, on of say competing And than areas differentiate would in are we they're So do partnership where succession permanent planning, we that offer solution that say do would for lower well the differentiated Tom? And there. I businesses going like the is I scaled because already to a and have pipeline. that we either looking through and ourselves. they're or

And quick of we're assuming terms just your answer Friday. question, a market of on X.X% as blend other our in

session. that floor I'll our gentlemen, for comments. back question-and-answer Ladies and Mr. to any final Horgen the concludes turn

business AMG focused XXXX. I had earnings hope all the has you But speaking remain opportunities strong joining Thank everyone and quarter. to growth with next safe Thank discussed, we we forward you look healthy, increased our of remains for this again finish of power us. and us morning. the significant ahead as considerably, to and a you. on

you. Thank conference. today's This concludes

disconnect your Thank this for time. may lines at You you your participation.