Affiliated Managers (MGR) 5 Feb 242023 Q4 Earnings call transcript

Greetings, and welcome to the AMG Fourth Quarter 2023 Earnings Call. [Operator Instructions]. 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 Figueroa, Relations for Patricia Thank you.

may begin. You

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

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

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

further investing Thanks, everyone. areas, operating investments impact Partners. capital our X AMG's positive results and the and reflect strategy distinct XXXX, our in by growth areas new of Ara discipline morning, and repurchases. In we share markets, fast-growing across business [indiscernible] both allocation good and in full growth private secular year Patricia, affiliates diversified welcoming our of

geographies and the collaborated existing products. their including We into affiliates channels our with new of expanding also and several in development innovative new reach

composition and we wanted on strengthen significant evolution. capital while the returning I enhanced meaningfully excess changing to our and our as business balance shareholders. AMG's strategic we liquidity sheet XXXX, reflect further Finally, position enter to also is

markets investing that business in balanced has investments of have on come and affiliates by long-only several in alternatives. Today, their from from With are areas, the capitalize private alternatives the our deliberately further. In that one one independent X Over by growth alongside AMG's liquid of from of growth markets, as half half growth strategies. contributions alternative industry. secular and strategies was diversified demand unique substantial majority ahead, differentiated private differentiated business our for we new the align And areas. AMG's existing our client coming to alternatives, durable have by our offer And business years, and strategies, differentiated all These sectors affiliates between investing long-only looking each Affiliates characterized our operating long-only positioned largely success we I'll long-term in to trends. private in discuss high-quality, contribution across opportunities. liquid other streams is markets, our profile in with reshaped earnings profile from from return with strategies, well past earnings

in strategies forward secondaries number tailwinds, and equity, real private approximately within markets opportunities. raised structural affiliates Over powder $XX capitalize long-term market of fast-growing private our challenging highlighting a their venture with XXXX, appeal estate. them areas the Private on private credit, Markets AMG's course strategies private infrastructure, specialized and of operate including capital fundraising specialty affiliates of environment, additional and to a dry providing billion, the amid with

we product ahead, new partnerships launches through growth, and markets of combination Looking organic independent with from accelerate the private expect a to firms. new contribution

alternatives. liquid to Turning

delivered differentiated clients affiliates their Our XXXX. for outstanding performance and in returns

portfolios markets. strategies, that of income underrepresented returns or value this in change to alternative generate as [ in liquid strategies all and client of and strategies down choppy correlation are broader believe these to including affiliates fixed value following, macro, markets. strategies, their no have expect to We proven low or sense trend ] return beta addition In our relative global manage have absolute which

portfolios, we value As changing address market fully the in allocations and liquid environment, increasing recognize of the to construction expect more their portfolio into to clients continue these focus alternatives. on strategies

to generate can AMG. sizable addition fee performance for significant earnings their for strategies In these growth, organic potential

across environments, fee last are alternative earnings. Liquid profile our an market essential business over alternatives long-only to In are the complementary markets years, performance often area nearly fact, our million feature our $XXX is vastly X underappreciated. delivered of different pretax private and liquid because strategies. unique This in have they both strategies

that Given are significant private performance consistent long-only be have when and strategies proven fee headwinds. earnings and to facing especially markets

together, a and source for of great is differentiator dynamic Taken this stabilization AMG.

to long-only strategies. differentiated Turning

number we the differentiated inception, managing quality a highest As partner-owned strategies. have partnered you long-only know, firms, independent of since AMG's with

in Loevner, Our brands of the the investing Tweedy, number Harding our affiliates and represent best of including Browne and Parnassus, include most a industry, renowned active Yacktman.

franchises built long-term environment cycles. More specialized dispersion expertise and market generally volatility constructive active broadly, enduring for characterized higher by the records Our affiliates market current asset investment managers. track and have more with across is

across our firms Given partner-owned their investment-centric risk, of alignment managing diversified especially high-quality private our of advantages our strategies long-only in differentiated is return enhances with areas our and streams to to clients, have shareholders. investing competitive orientation, competitive partner-owned stability supports uncertainty. Overall, advantage continue both operating entrepreneurial and during that periods of cultures, markets, alternatives a capacity in independent highest the benefit and liquid and portfolio independent and firms differentiated return heightened earnings offering growth

in our to successful our affiliates, significant and investment continue track X-decade partnerships, AMG existing evolve flexibility. by Looking new ahead, through unmatched capabilities and origination supported investments we new will our financial of record strategically growth

capital We also growth decisions capital while will shareholders. excess as invest to new opportunities remain disciplined returning in in we allocation our

by of AMG to evidenced affiliates, is outstanding. repurchasing XXXX, our of invested a new shares products In discipline X in Our seeded X new actions. our capital returned amount XX% and by shareholders significant

moment the acknowledge of magnify call in years celebrated firms take history. to I important with wanted milestone their partnering AMG's actively XX their a preserve Tom, independence. independent year, Last and to we to over an successfully advantages turn I to Before

independence and While over steadfast ensuring evolved unchanged. our AMG past while industry decades, the remains our further commitment the significantly success X investment have to affiliate their

affiliates value for our leverage decades our and insights capabilities clients to of continue to experience to strategic exceptional will offering shareholders. we ahead, create in their Looking our and

we Our proven our and enter that, engaged with and And shareholder reputation partner are a it decade, increasing And drive growth value. approach we I'll highest Tom. to globally. next over collaborative for our the opportunities turn as quality attracts invest as to seeing firms

morning, Jay, Thank good you, everyone. and

year, quarter position XXXX, our continued us of illustrate to of driven our continued liquid and AMG's evolve allocating to organic had XXXX. our to and performance year. our earnings forward business ended strong seeing are markets, in XXXX business power. investment million We areas highest $XXX of alternatives, year capital for excellent strong increasing AUM differentiated contributed performance long-only approximately levels across and the the fee And outstanding our the momentum the entered earnings Our to growth. In our performance for XXXX liquidity on fundraising private affiliates' sheet raising capital growth. focus to best markets, where deploy private in in well a earnings We balance shareholder drive secular momentum results long-term a strong we to by growth for our growth, and fourth resources with quarter capital the diverse and value. significant in durable of set affiliates drive positioned at

ongoing earnings net strong of consistent diversify Adjusted our affiliate quarter $XXX be enhance continue Performance power. fee investment and that earnings execution strategy growth to profile earnings and invest the $XXX of of in earnings and million Turning included fourth fee areas. valuable reflecting our to performance million a our further EBITDA earnings results. to of performance source and our secular flow cash

the earnings $X.XX primarily share and Net by certain investment affiliates results Today, alternatives in approximately the markets, compared products. Economic strong asset recent for the further billion strategies $XXX affiliate continued we we of both of across fee quarters. footprint of our eligible offset expect cash earnings absolute expanding to market beta benefited and $X.XX related earnings $X outflows, reflect grow organic our performance to for billion opportunity quarter, new of fundraising, earnings. treatment a fee-eligible of sensitive client through growth, fundamental from year. generated continue Our These tax new benefits performance private to impact prior share improvement equities. of performance combination and excluding year foreign quarter private return fee each and AUM, fee our quantitative strength partnerships approximately to discrete performance per an strategies, included performance repurchases have of tax the areas, and were

quantitative in fourth affiliates growth net billion across Turning and alternatives, In by the business quarter, Private inflows results for rate to $X XX% raised performance to the organic certain we a Markets private excluding strategies. in driven full billion fundraising. again our in contributing quarter, nearly the reported with year. strong markets $X

approximately $XXX client with and in markets private ongoing generate are fundraising in to to AMG areas and markets has affiliates. Together, assets outstanding partnered we from significant momentum now XXXX. in long-term expect strong affiliates Our demand. private investment manage support clients of they firms continue these X demand seeing performance, operate billion the

billion Our and that billion in affiliates quarter, seasonality in $XX in life in $XX infrastructure strategies, in fees driven strategies manage in of $X real solutions, decarbonization, billion we outflows $XX multifamily estate. In private including beta sciences market the in liquid industrial areas, credit $XX specialty while XQ. alternatives, and generated saw billion primarily by sensitive billion private performance

years investment return across diversification their outstanding trends stability positions as to that forward streams X of from look add for the them performance to our to benefit confident differentiated last a are We clients range over affiliates demand and products, portfolios.

year the million global approximately $XXX XXXX market fee equities that flows long-only strategies outflows earnings have earlier, long-term capture we flat. Overall, position in we delivered million multiple mentioned fixed the records demand net nearly and saw the we U.S. I in of our strategies, over in and years. time. income quarter, $X multi-asset billion over track As billion last $X them for full to client while strong affiliates fourth across nearly $XXX performance Within differentiated X generated remain were cycles, of and confident

Now first moving guidance. to quarter

net $XX EBITDA in million was AUM and market affiliates. of Friday $XX between million expect $XX including our quarter-to-date We million which catch-up markets of earnings on of $XXX based $XXX fees flat other reflecting million as and million performance blend, levels, fee and from to adjusted be to current private

and of economic in an range expense, the the you We detailed and other weighted shares taxes XX.X where we adjusted of find earnings expect guidance modeling the first for and section Consistent million share a last our quarter economic impairments, Relations website $X.XX to Investor average can items. share interest reconciliation assuming posted income quarter, of to with items, $X.XX count including amortization quarter. the per

fee the year. Turning full earnings to for performance expectations

$XXX past net year. believe about in fee that roughly we earnings have baseline good X a normalized fee annually, and earnings a thinking our performance for performance the Over averaged years, million is

capital turning our Finally, sheet balance to allocation. and

nearly excellent revolver. balance of $XXX capacity and the paydown debt Our potential of million in of billion an is position net sheet undrawn full $X.XX with liquidity our

in allocation outstanding liquidity returns XXXX refinance to upcoming over debt of market our I including bond shareholders. In through managing actively have near for in manage earning shareholders the As and decision-making capital framework returning continue against term, approximately depending million of expect total returning common we appropriate our fourth pay on quarter, the a XXXX growth opportunistically shares, our earlier in institutional to investing we quarter, to short-term and conditions. leverage, completed our all repurchases. through mentioned XX% term down capital are holding to running net the by the in $XXX to net [ capital option shares repurchased maturity look long risk-adjusted last inclusive year. ensure of repurchases million We we to excess the XXX are excess share and we and ASR million], bringing We shareholders $XXX treasuries to the our XXXX repurchased our for while

$XXX of market to XXXX, million in full our of growing we We excess investment shares then new XXXX new new through in capital strength alongside For affiliates, through returning seeding at existing with strong AMG's set activity. conditions opportunity subject deploy a capital including to investments share and capital expect capabilities, across a position entered products, investing a innovating and least affiliates, to repurchases. year in and position, repurchase

about excited Looking disciplined significant distinct ahead, are to we're value to us create advantages, and shareholders our of allocation framework our opportunities positioned now competitive and ahead time. happy the And well are questions. over given capital we take for your

[Operator Instructions].

the from with Katz comes Cowen. question Bill first TD of Our line

I a X-part, Maybe if could cheat.

those within deal the getting liquid or part of all? much how pipeline? recent this the allocations? the discussion, is you of things first are where of subject [ alt how consultant the community terms to better just then versus that, about in think And are of affecting if think multiples you deal new real-time ] your is The terms some at And conversations do expectations you just with in view discussion

and new with you. then and Yes. hear pipeline from start Well, alts have about I'll address and the Maybe talk I'll valuation, liquid deal Tom our question, there. thanks, Bill, again, nice start with I'll expectations maybe and of what dynamics the with is new talk investments Framework], environment here remind investments strategy [ and there. about the new just you our then to, market to

you differentiated as know, in markets, long-only strategies. to growth within alternatives and liquid of strategy, Our secular invest areas is private

In all cut areas, includes on across themes addition themes. certain that that to that, we wealth focused other and sustainable are investing, and X

We before several in year investments last have and made year this year, these areas. the

a liquid generated grow. we that through can resources with really, within specialty a been both been affiliate we half on new of and continue that increasingly growing help remarks, and so. range. as have opportunities value advantages some for one investment to that's on alternatives finer us a for kind strategic that then side. We've million. number the $X other range, a they the looking XXX investing that some private size changing help, private need of infrastructure, investments a range not or million but one where think, between only we way on billion that can you grow, us for to markets as it, is in and own, we XX to areas is business say, is put their easier that point not firms we've really that wealth if that's we in also see AUM have has only alternatives is in made our the side. in already markets, areas $XX our magnify do $XXX have the about triple to prepared institutional firm they tailwinds we're X last result, it's to I strategies. And credit on the this to like And And my We we the over sort private new in continuing new like private on EBITDA, Maybe years, been we and, it but And partner their grow. these about expect to of targeting think focus is time benefit is are $X than that Enterprise solutions, our And markets, And billion to our on side a billion. of the structural scaled them that help and today, and of composition. as said good affiliates do that focused are for and

So our of reflects active again, case it. In very very active there, the there. alternatives, private pipeline markets and liquid

precisely down X long-only fact, choppy private liquid way. remarks, long-only are when of As the performed in dynamic headwinds. mentioned a complementary the talk the because, flat, prepared well markets and alternatives markets, also facing my how Generally act and in nature in we I to both about or -- speaking, that's in differentiated strategies they other

So of in those many sort to alternatives because a buyers with managers. We've time. We're the success aren't of liquid over to there we're lot of unique had continue marketplace very partner types look, businesses. to for excited

competitive So to there. we see be our advantages high

that already nicely regard. are looking managers and we range strategies return absolute really alternative of in that diverse sought and in We our [ for ] alternatives They within opportunistic have. liquid given liquid

and fast track market that's increase So are Obviously, time. -- client we that looking the the sort we're describing that, really areas backdrop to that of allocations opportunity these have Maybe over growing areas for. are are our what our taking for have to we that ability partnership are actively but also record, the success advantages. we the support we both independence. competitive affiliates, model. proven of our our for several look at When known environment, magnify XX-year their And market have we

us they affiliates, and universe. does more remain So for uniquely from apart strategic take stark independent set apart remain the relinquish and universe, it and those firms want who and are also the those that prospective our a to partner That want independence. strategically want really target passive partner-owned to who target both from in and sets AMG in requires their is our they to buyers, do ability also consolidator that independent, benefit a us control consolidate positively those financial-oriented to from contrast because or is

So advantage actively really and that strategic the both gives be support to unique us in a market independents.

We capabilities have also years. here enhanced origination our last over several the

more are for say, And so guess and both our but pipeline. And environment we world perspective, attractive I we're just much more a in canvassing is would originating way. a from new is AMG. finally, I very affiliates, That perspective, an proprietary systematic the organic rigorous transaction the increasing

You've market but at scaled have high seen firms. a large are come that prices, extremely in those the few transactions recently

I firms and both over the where last those parties and seen a think benefit months, the sharing moderated would we from also opportunity for XX I can the to help. XX perspective. firms somewhat, say, mid-market we've risk moderate It's structures pricing

X constructive expectations we're investment investing, XXXX, liquid year from invest the ] [ opportunity life had When and industrial reflect XXXX to have the other diligence. attractive ] sustainable an X [indiscernible] ultimately would I it not we our meet our here, the could an being and say area more that did sciences back a additional even discipline. with financial demonstrated final in the being We entered new We firms see alternatives. one both XXXX. Maybe decarbonization. been at private perspective. new And But it look due new that on significant moment. stages the in on being private I'll year, we AR this both and markets, in environment, added in highly a markets we investments, for both So an [ partners, just partners for

stronger time our at pipeline it than last we is was So when this strong, maybe XXXX, look year.

we from our make these do to growth. And areas investment is opportunities in within approach. secular and what fit see to these transactions here new in with of parameters need that sure continue We disciplined keeping to our

to new forward on investments our pipeline. we're we year So making this and looking very constructive are

now talk So alts. me let to Tom it about liquid turn to over

I'll thanks your question, Bill. and Jay, for brief. Thanks, be

on break of maybe I the into liquid about seeing But question number he a we're opportunities think actually alt on the X investment Jay parts. to touched drivers Bill, side. when new talked your the

that's excellent clients sort now alternative of means they and expectations our real alternatives when in future. What's proposition on are happening what and performance delivering time performance for first, for that the the value is that what's looking the around invest liquid The for second, strategies. happening really liquid

talked driven we remarks, a of my I earnings by As fee strategies cash new and through. liquid growth went billion this across And about that than the investment prepared in group. the year, over $XXX and million use drive that performance alternative years, primarily X last to more $XXX the last in XX delivered diverse in strategy just $X.X years invest we some million our really to Jay opportunities over

we the think at If are that relative and delivering firms Capula basis you sharp about like are cycles. value well that absolute and relative performing Garda high strategies a both on strategies play at in extremely across have market here, ratios

following and last performed at seen years. period firms that long-term the performance the have we've strong several see have track strategies and return have like AQR. records We well very AQR trend absolute Systematica over over Winton, like strong We firms really at extremely volatile

contribute for strong earnings performance importantly, contributing fee is performance opportunity fee continue to clients, that time. of to of a growing all performance and the to earnings combination over So to strong also

think of the of demand. core terms future, In this client for question, mean what does the and your I

stability of that lot opportunity we to alternative returns One, in up a types today are strong set liquid time play and liquid we've in deliver very are the more of sort of can and it's years clients next of in and move in that well seen portfolios diversification and the picture of of think the as well conversations some for in both. I populating and look cycles really where alternatives. And really into things lots and environment of XX we combination that the products, there terms the that proposition strategies expectations a volatility in strong client of risk-adjusted with out seeing cases, repopulating times. terms value for volatile are over

in alts future. liquid have So may join about we're excited point, the And both that opportunity, us affiliates today. Jay's the of terms to in those the we

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

alternatives. the Jay, you EBITDA the been alt couple highlighted a expectations guys a improvement EBITDA both over bit that for categories? talk years for from over the private we're and the these in towards of alts have little thinking for number about business the now continued a side you couple XX% as both side Can about next of growth and of So pivoting times of now liquid for comes years flows of

each Yes. would a market this Thanks, give side and fundraising some that -- on Alex. on you perspective Maybe top-down I just private we this. Tom will From year. say alone perspective, I through the

If activity on you year. all whole course fundraising billion look $XX billion. at their of -- we base But didn't own the of at look year, $XXX was [indiscernible] it you about of a through if the the

managers, you has gives a think a ahead we mean we the which I also Pepper of we including the But fundraising for sense [ of when very -- of sizable have tree], have cases, couple I number in infrastructure-related that we it look, Pantheon, it. out So some they're years, business. is which infrastructure. capabilities. And look infrastructure an think next in a

is infrastructure. We and have EIG, infrastructure, is an have we an which which our partners,

these So we're think. we trends, sort think of ahead of I

expect so maybe And we even actually will continue, trends these accelerate.

strategy side say still know I really area growth. we a lending where as around direct that's as the direct the lending where I Comvest. Pantheon And other characterize going primary on as meaningful the be to business you how area. secondaries secondaries we're it The heard, has credit think otherwise to don't with would created develops extraordinary seeing

trends, excited of we're these very some about them. we're think ahead of So we

potentially it to addition in as So we we what increasing. saw year, this see strong

benefits here times. alt in say choppy clearly we the these On would that seen very of the liquid have AMG, side, businesses at I

as a if our they're said, liquid alts. So clients think I looking noticed, you're to think year these liquid doing Tom is supplement it do that these with XXXX, strategies. in and their And have that years, repopulating several had expectation will clients to in I they're turn portfolio. what alternatives we terrific out

thing note that note first important of to have period And to thing they're return is that's important, speaking, the we the The that's they generally either then headed lower second are past. is correlation as think had for different to kind And in a liquid. markets. no are absolute very or especially we or than what we've

So to yes, would our of I having growing I a think of see do also we're as it and growth. the somewhere both this that that started XX%, ago. we percentage AMG X EBITDA driving X journey, in years say middle

I alternatives of and balance see of think next our could maybe X/X do in both being to by a those. X So years, X let business And of Tom the we driven add. I'll

you Tom. If like,

Jay made. just points that of the add things Maybe couple to a to quick Yes.

towards have. that overall we all change And even change should the One, to pretty fundraising matters, sort If that to up going to we a flow continue it about that think nature and performance to profile that that's the the you important duration that level approach we it's the capital alternatives. business level It's to to why maybe continue AMG fee as going of of more a to locked and period longer the of time, fee dramatically of the continue X/X get profile. contribute going and carry think that beyond over change I right, have. It's of our moving X/X have. opportunity we to very

differentiator private Systematica is is drive alternatives things business what looks to like in best may the side Pantheon and to fastest-growing, quality, to the opportunities. product to point into like like what a wealth So terms mix products, are alternatives new real those Comvest or space on the growth. also not in highest attract continue growth all, of liquid industry, things U.S. point important years only our of helping these we just like firms I'd the and bring ago the but new business positioned X add and that firms. we're that future. The the as also Working ourselves it as on highest And on what some One, get with us us. to today to something not really doing firms of only the liquid for to launch that And market looks firms firms in helps as incredibly may become I that's Helping relative own. AMG strategic really part can the Jay's looking help able other like do two, those what's outsized what be to are for the firms that think, to differentiate growth a mix to private but in are markets markets well where they what our ecosystem once drive table important help partner. overall their look

business of a and our the part are think all really higher So and of I growth ultimately overall things health business profile our mix driving time. important those over and strategy our of

Yes.

our allocation other relates have our the to we and so, in getting and in -- we strategy see remain capital lot I I would mix think would could we It disciplined to one quickly. the look, to we say, a destination. lose that case to do it change But of actually opportunities, really order is our thing business is discipline.

mistake it. -- would But the here no we we are -- exercising and mention that one make a I about our that is virtue thing patience. is patience So

level the And for to investments our fewer new find growth at meet changing shares thresholds, we repurchasing where new repurchase that making we of shares. we're that our We our business. the that good believe when the return be future are therefore, more we are fortunate planning in we're -- to composition we're can't it. able just have investments -- And that for our we're

the from Craig line of of America. comes question Siegenthaler next with Bank Our

hope I you years want to XX employees Tom, on Jay, the your into [indiscernible]. [indiscernible]. also I congratulate you

you. Yes. thank Thanks that, saying Craig. Well, for

net on is question My flows.

simple and negative there's in despite seasonality like math of And see the to exit flow $XX market pretty where then nice And So flows actually of didn't X private that look is forward. think the you from XQ, that of the stronger kind that's last a I into see rate a heading it's number. contribution question It's then outflows think outflows net we've flows just and in 'XX, it it's do improvement. over any how flows on but EBITDA are the improve, going fees my sometimes is, lower net But improving privates that we then the active looks the we are less number seen saw the where equities. But follow-up in higher? versus fact years? and underlying heading based just is flows we've seen, what do the much given billion-ish

I'll that, biggest what's is to for and Craig, Look, happening may I'm So the of maybe us want some sure on thoughts Jay as side. the add active overall well. take equity point uncertainty

And and growth evidence of core likely evolution number variability. secular of towards seen years. focus enhance the last strong do your you very that a where seen exactly markets. you've expect especially And with several brands long-term of continue. extremely earnings private think that the some obviously, we're to we course we've against affiliate execute on of the as I have more business. and our performance the alternatives the records. We growth strategy, the of right. When But this that's variability with is organic of mix there continue in business we really areas our over think And driving of about But the to will track growth that, some strong long-term point

that the drive AMG's continues should we're think smaller highest part for have and an one this like to where year, our headwinds, overall of the management to to seeing to quality business. higher billion environment So we into longer saw business mix a best if business about the our also continue areas the the means those entering opportunity that ultimately a franchises that question improve higher to growth affiliates be on two, experiencing opportunity think where $XX But is you percentage to be we in of and term. active continues move, And are what growth. that right, areas as your going are

opportunity feel contributors. think recover and long we that opportunity side, real businesses for be we a on very like have but So and on secular ultimately those long-only also growth the alternatives we big the to we're the side

terms AMG on own In a when businesses, EBITDA the think it about side, we to importantly, not own businesses. carry ways. I on opportunity those those are important business on couple certainly, a a the a a think alternative stake underlying tend There story, management performance about on you longer-term we well. of as handful firms with really minority it's opportunity underlying of majority in higher alternatives In the One, fee general, the fees fee the there's are think although to and it's fee the mix. also But liquid respect rate private to only the markets. on where the then but side in

fee day on seeing that is well. management of X X of a X, the the X, underlying some terms new but lot in experience the as X, in, ultimately, next EBITDA years the there carry So building you're we'll course EBITDA as over it it on bringing we're of fundraising of

drive So over ultimately last we point to lot going And cash to improve mix the there to that are is overall time, that generate. of question, and on ways profile for earnings different shift cash use also Jay's ways over this business but are earnings our us growth. of growth both a that time a there flow our to number the profile

-- Yes. there by and did challenges summarize there Tom are just saying, And opportunities. I'll I'll look, just are nice job. a

obviously, And do businesses. We and we I ultimately, flows We client active it's businesses away. more we of is away. delivery think therefore, portfolio. that just active respect have be of investing, Long-only in not going think whether improve it's don't sizable product and of away. gone legacy structures it's the but investing think the the don't successful AUM is industry, going up. We we those really believe towards long-only or to going think with the our us quality attitudes technology, to going active relate the not evolution been challenge part just management it's rightsized. to has it's are who ours, but And think some in think for think, that way the I the of

challenge, we alternatives And in a we year opportunity good keep the right? maybe good on and year before, We AUM. The had those had businesses we're That's seeing So this we is that's describing. that continue, to increase. where -- even We all had a challenge on the year. expect AUM a prior year. good the a year

underlying because said, shift. length that fee mix is for the that really are it up us. think Tom rates mix And we of the shift and as a mix that just stability, average quality, going shift, question So

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

we ex do [ Wanted about to flows? given certain or Performance in How affiliates you specifically, -- you can And prospects where think specifically of been saying been liquid growth alts. ] the think those you you in good? have the specifically, quant ask how of terms where will good. has in about [indiscernible] And do about those strategies. ex XXXX And think is the performance the fees some affiliates? do stop

the thanks Dan. for question, So

If an ultimately substantial back others we outflows a the a or [ quant where started earnings. in a delivering why Quant]. remind of amount affiliate have just bit, you situation to side maybe did history who affiliates of reporting large weren't had ex a couple on at go We we

having overall system material was our a really that So there earnings of the was was and quantum on not pretty a the profile. EBITDA overall disconnect between AUM our which big impact leaving

earnings a more business. that at a So that shareholders to communicate transparent to them do think We we thought to has we're the profile point of the much understand way it help normalized. now overall where was with

the to But probably the those way we rethink do seeing reporting So where combination position time performance normalization we're going strong the a we're that does as ex of that. evaluate put as really contribution, in a to where it's we've well in AUM think been us of quant. a businesses earnings of number continue I to are and on

Yes. I over would saw we that say normalization. that sometime this past year in the XXXX, crossed we where point probably

firms alternatives change bucket, being they optimistic their probably And in that us again, forward, can here, to looking reason so business straight I that notable we particularly the to that contribution, for were guess results were think 'XX back area, specific that point And 'XX, it And about is AQR, real of strong the in AQR. maybe one performance, normalized pivot in most the that excellent number it's performance liquid some that we because regained and think very And relative organic there normalized, has has we're to is the and just had forward that. it a fees the and flows. growth. We size even increasingly prospects, seeing momentum. making time showing

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

fundraising also help you on distribution of talk the of profile, have is basically your in let's the It on you that potentially Q&A positioning a your can like diversity say, firms. to just also from up terms the that prepared pipeline in of you've the to sort partnership touch of that also lot in you'll growth sounds section just just just contribution that Maybe commentary your organic fundraising stronger comment you're summing discussed Certainly can given a pipeline. But across remarks. Have noticed perspective, for like the future. can about improving if and maybe that, of distribution in profile your and predictability firm and that. angle definitely the that a, you and if the that I'd

Yes. Yes.

happened and summarize quarter you're think And turn. flows are see will to the as output is strategy, as in aggregate. What some long seems this business and happens growth. extent the will it faced summary, I we secular -- long-term of traditional right we have growing which of an versus strategy, to conviction and flows that by correct, invest the the saying future, of or is that I'll we it alternatives kind positive we're business, to our at execution is we think then flows recently in ultimately quarter, now. of just too fast our other the the strategy but on areas XX-XX in see it So we in us Whether that crosscurrents we're

Maybe Tom I'll distribution the statement that there. to side. is think turn talk to seeing it summary on I the what about So we're

Yes.

kind level, look So if primary a do things. X Brian, at you at our of we really a take high distribution,

for to already and business. we existing On efforts have We've global helping raised part this the a the I side, affiliates our U.S. with think new opportunity that course billion to the of seeing growth good haven't to and new that been for affiliates look our than them clients today, on pace mentioned That's I we're meet side, us. The over our they in and is of historically. more a access geographies into of of sort be the time, where some the continues wealth real one magnify $XXX earlier. had change institutional really of long-term get a

really opportunities mutual XX past a that been We new separately managed of increasingly front. or limited side. market on And comprised liquidity and about funds, months leaning in accounts wealth the billion vehicles so U.S. the limited platform $XX we've private the toward of combination have course on a of over liquidity

the billion. wealth the X earlier, on U.S. an mentioned their as that So now with it opportunity market the helps area growth have But or also next $X to alternatives only success I AMG the to helps One, and largest important ability into similar really scale own. doesn't new to that world space. as we've do at is affiliates affiliate it single fund, who's the is which attract market for us to seen reasons. in break two, to drive it the the we Pantheon looking approaching existing that the the see in it's us not growth And

So product It's differentiating to long now of a do we we new it proposition. success on the on but broadly accelerant affiliates lot increasingly as an term, over and the going value an as be our shift had something also of alternatives. the our how and toward see in strategy with more right think more part AMG and really and do we've about right distribution working is geography wrapper capital strategy formation, right into the launch we product we what thinking to the including

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

limited liquidity try higher the the I the flows is you of at liquid liquid on your maybe made. know the managers, last specific of seen about frame morning. you. fundraising in Good to Could talk just alts how wealth strategies, follow-up year but looking products have you we've what over volume the year on Thank to maybe or level, a before? versus you that don't the point looking layering calendars all alts. like maybe a to I plan, illiquid

thanks are specialized affiliates specific now full last we're Patrick, billion and in as about think areas. both Jay part year. of investments private we to of a with that the I some the the question. $XX prepared your $XXX for private for exciting basis if overall X across new And market in big project Forbion], of about we're a for to with Yes. overall and We shape credit the partnered year at and on a of mentioned, forma private pro business. for you billion partners about aren't of the the mentioned solutions, But going made think Ara and $XX the to diversification then [ certainly affiliates. I flows we markets variety fundraising buckets infrastructure, add group remarks, continuing being really my of billion,

us not really to what find value LBO that's client mainstream, And products that enabled we apart we us series I we environment So one scarcity can large-cap, was set have necessarily are highly value XXXX the very of who add a portfolios do. we in the lot of a places managers in-demand and have where fundraising there's big think, of the a products. in type in things fact difficult to that a that, -- where are

couple affiliates we working forward new in to things, new and adjacencies I outlook next that partner leg putting an will, all that that then of they're affiliates. of client stool, their will have opening if going is news a channel. affiliates. flagship One, today A for number forth entire the for to a they're products doing efforts great space, which the of us we're of the a the to with Two, existing new right? what think new point, these and really the U.S. be function of launch. wealth the you up your us that And helping in

think in terms in to us, be and the long-term side, we're the of on that a trajectory to continues market for positive very private add continue different So of we to looking the number to flows ways.

more its to I led to about out the more liquid strategies. just is it and mentioned marks capital interest really and more particular, guess, just to sort greater attracted we obvious large liquid portfolio. I of It has ability have high fees. led to also in as in has alts well. talking statement by to alternatives round by inquiry, to water But performance Look, just alternative pools asset has generate positive I'll adding liquid alts. those performance the momentum of led it's levels good ability, performance above higher AQR in already and has

and really have affiliates that generate growth number a of can over alts time. We liquid organic sizable

the performance part So see side side, on private alt the so just the because as good. as both in we growth well market is liquid

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

all you forward quarter. for look We again with Thanks. this speaking us Thank next morning. joining to you

conference you. Thank concludes This today's call.

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