Artisan Partners Asset Management (APAM) 3 Aug 222022 Q2 Earnings call transcript

Good day, and welcome to the Artisan Partners Second Quarter 2022 Earnings Call [Operator Instructions]. Please note that this event is being recorded. I would not like to turn the conference over to Makela Taphorn with Artisan Partners. Please go ahead.

Thank you. Partners business Artisan call. and the to Asset update Management earnings Welcome call Eric from include CEO; Today's remarks Colson, will and C.J. Daley, CFO.

and of results Investor latest investor available are Our on Relations section our site. Web presentation the

we remarks, these line for will Following questions. the open

our remind subject like today's responses uncertainties with in are to filings may risks begin, questions, comments forward-looking with the including that and presented to and we made you earnings detailed SEC. Before statements. to deal I'd on call, These in release the are and

We required statements not to are any update of following or these revise the call.

of made financial In our addition, to references will non-GAAP some remarks today include measures.

You earnings Eric can most the release. the I to will Colson. the of find to those now measures over in comparable GAAP measures turn reconciliations call

for thank the transcript. everyone you, the reading and or Thank Makela, call joining you

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come [Operator today our Instructions] will RBC And Markets. first Capital with question Kenneth from Lee

First and How given strategies market all across the just investment and one the think this -- capacity, investment is current the volatility various dynamics. your at teams about all do various just point? capacity you around

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disruptive not the it's of to strategy. the integrity So

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And our come will Dan with question Jefferies. Fannon next from

how Curious strong. expand asset been Eric, comments weigh sit term kind historical track things I alpha your they of versus today in of was of you the allocators upon, longer about you quite Obviously, made. performance with conversations where generation could records has some today? periods hoping as the and

a was shorter shape these looked used term. and up index AUM With page the on up year And month up well with to we moved shorter just we're the we period. that periods then and period, asset down were today, these little draw regards didn't allocation excess a for a as great we produce tools better return. where we a -- away XX% think periods V at a three bit actually performance always index, XX%, asset where drawdown an also behind return haven't were highlight end duration it to looked seeing pretty the highlighted and of XX%, it XX%, allocation does client of period prepared those and the deck year absolute that our XX% tactical exposure. product where in of in month I In sharp do to of crisis, we highlighted, exposures. unique more highlight XX to term our the later it a each people were that managed then on out makes likewise, the and With remarks. it's back static firm, for XX% and moved produce but and and regards short up. in allocation ‘XX index three clouded We deck, XXXX, by moving today, was the we think And of the strategic longer and And the on XX up on in XX recoveries. strategic. a I our business that periods did these clients, we those five longer towards a fueled back three And very I We it the with to and lagged our execute at we've periods. and have clients, looking we would data from tactical XX And allocators, services opportunity in outcome very recovery. during the and

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distribution. think because can these long would strategies I back products periods a quicker, market run. it's invest because engineered you for and our built pull timing through the to have We are

So guess inflow clients' allocation gross was on outflow product that had it a a view pause us. doesn't surprise We we've perspective in to we that term made our makes us inflow. other have bit gross sense shifts quarter same little our maybe tactical mix. I on and our and this really about the shorter It seen clients that that and quarters. that's

And just guess, then the -- to to anything And is expand and half C.J. terms be distribution doing, the upon you non-com fair kind the around I of also on would XQ if back levels mentioned reasonable you of there's could for expenses, in of this investments could Thinking continuing about you've there. comment invest. highlight specifically But follow-up your year? what or you're some helpful? that if for

with a to bit on two did came a quarters, see were the was in technology. pretty this with we out, set the quarter were sort target quarterly the area being call, next maybe third travel on primarily right this guidance lighter an we we compensation and around quarter, end is on We're was that quarter compensation, the which one We're targets of levels. back in basis. gave occupancy back typical. where they little the fixed January target to from about gave, and year, we $X on see we $XX that lower to million then million bit up little target and tech, we're pre-COVID in increase say and And comp a travel, on to of those million I'd on occupancy but this but of robustly side that of the the The uptick benefits. where We close $X be areas the which

internal targets. it's majority given, sort we to and the with and to respect side. the the with track good achieve strategies, been around and sales it's as are of we enablement the to those that With been clients, resources the guidance distribution, really in as strategies this well investment of prospective -- new So new onboarded we've on have as around target feel intermediary teams team some digital year, we as on well space dedicated accelerating

but we've made we're early innings year. this the So those them in of investments

come And Blostein will our from next Goldman Sachs. Alex question with

hoping a how Eric, you volatile new on talent minutes a environment. in was negative, thinking net teams spend I new couple about could are you of more positive, and net bring a it opportunity in guys Is the that today? to

and marketplace to many want a robust see about activity activity. importantly, think, And term with long it's M&A actually where natural to continued to Usually career. reside think I and investment M&A their then volatility franchise, and with for in they more of the pretty want with volatility, home an build for to their they where we've people

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newer to need little in of bit including so the guys nothing than couple balance private right the sort guess product. that guess material, you've of you bit on What changing the amount initiatives too from doesn't you the guys marketplace? C.J., seed the in sheet especially I for seed is the do think balance commitment you anything's of of done a the extra sound talk but past a I growth, have heard sheet like But you've then sort obviously perspective, some the little heard of that to cash, you I the to about more co-invest retaining markets have now, talked there. you And to a quarters support capital on

a C.J. jump to the to fortunate I'll launch in and an a equity and launch and that much of US. of of we of to oriented seed, in top takes class. of driven in really demand And and that, the smaller is We've by the investments jump capital we're quite then credit asset amount did global also on Really in and it the interest public uptick array strategy operating demand. the and in with Today, primarily EMsights asset strategies. on class Capital is array response. add launch been more seed strategies recent Group let

So amount US. asset the to only also to footprint distribution firm of not outside class, we've the the amount the due the increased we've being the due increased

non-US is number debt attracting the clients highlighted we the clients, a Global markets for both Unconstrained fund. of a and emerging As prospects and and UCIT mutual

is we equity go hard asset some but around strategies, class class. or that asset into current launching we normalize uptick to it's back move So another oriented if really the to

strategies The only seed in objective continues. and back other have is to that time, we our our can teams. in And end, thing approach to process that, to I would seed We appropriate disciplined invest then at a recycle that obviously investment reinvest capital make the investments on growth, the capital. primary support we add so is

come our with Dunn question And from John Evercore next will ISI.

little demand the the about kind outflows. both driving side? different you could and of You the a account separate a on dynamics of the side clients Maybe about fund talked guys and about more amount then reallocating talk small

fund tend or a it's fund UCIT clients of a long lot most we to CIT. horizons. that look mutual Certainly to clients, side in attracts invest of have really institutional in term the a the whether Artisan the or And

we don't vehicle. really based difference on So much a of see

recently thinking more their have We seen about really exposure. clients risk

for as was strategy, was the with so the invested had view, is the a about we've In private and to than relationship, a was significant allocation. that increase client drove much One time a flow or risk amount and clearly reweight given wealth asset of not in perspective. allocation. last only either a of two less year quarter this outflow. an shift years that horizon a clients Two our there sovereign wanted decision half my us was was due to to three it seen statement client portfolio, that their and a it that allocation And

with the and that other years. plus outperformed us over relationship, We that index was over The the client larger for wanted seven year client to a was seven superannuation de-risk.

So the evaluation our their overall trend mind, in an exposure. of risk really, is

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next years, number very over few sufficient strategies. of that's No, the a

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conference. may our conclude will today's And for your this thank question-and-answer you also you attending presentation. disconnect session, now And time, this We'd at today's like concluding to lines.