Invesco (IVZ) 24 Jan 222022 Q4 Earnings call transcript

Welcome to Invesco’s Fourth Quarter Earnings Conference Call. All participants will be in a listen-only mode until the question-and-answer session. [Operator Instructions] As a reminder, today's call is being recorded.

Now I would like to turn the call over to Greg Ketron, Invesco's Head of Investor Relations.

Thanks, operator, and to all of you joining us on Invesco's quarterly earnings call.

press topics have today. we today's that a to the covers plan addition release, provided we presentation In to address press are presentation release our The invesco.com. website, available on and to can the website. found information This by Investor section of be Relations the going

include statements today and statements well for the and review measures will measures. of the the certain Slide appendix to disclosures as on Our X financial GAAP. appropriate presentation Please forward-looking presentation non-GAAP the regarding reconciliations these as

and The does of on for edit webcast Finally, nor transcripts accuracy Invesco responsible is located the not our provided guarantee not are website. our by only teleconference earnings third parties. authorized

we Officer; will for up open Flanagan, and this the we results questions. Marty Dukes, presentation, Chief After and present Chief will our Financial Officer, Executive call morning. President the Allison complete

turn to the over call I'll Marty. Now

declining the Composite resulted markets, more suffer, to This decades. Index Merchant XX%, we've over XX%, and by than interest Thank thanks you, global of rates when following quarter no going year. to or nearly in rise XX% a quarter us. to if And year geography markets. markets the which concluded on in joining aggregate bond since MSCI the highlights. is index immune declined I'm global class for you're volatility Slide seen asset the NASDAQ typically XXXX, bond in the headwinds heaven fourth declined worst and experienced safe X fourth due along, Greg, start S&P was for Seemingly, the everybody Markets The equity worst significantly significant in the and with year

organic in assets. a outflows as high for capabilities came experienced risk-off the made deliver a Despite for a in growth, to infections organic capabilities challenges with our demand pleased in and COVID preference China pressure Rising in investors offsetting areas dynamic close harvesting key express tax net XXXX, loss in client to continued see that growth industry industry. developed as economies year to and we're redemption challenging

year Greater institutional inflows these long-term extraordinary headwinds. ability of Key capabilities strength income, to the delivered in and face net the for platform the demonstrates of diversified the ETFs, resilience included market fixed and outcomes that our channel. The deliver firm's China

stabilization market the fourth showed quarter. in areas weigh led Although, growth the generating signs demand. to separated and ETFs the itself in backdrop key investor in continued peers net from impacted industry quarter, of strong sentiment most in Invesco uncertain on inflows client by by capability

build improves. our organic sentiment the that Our capabilities fixed firm growth to quarters, and income to on of breadth inflows continued market to investor that organic of brings growth, Invesco track generating depth record for business XX when respectively. investment net and our to channel institutional consecutive The and return position XX

net in billion quarter. $X.X delivered inflows ETFs Invesco during long-term the

ETFs full $XX rate. the growth of in inflows, year, of For net organic billion long-term XX% brought the equivalent

Innovation Suite. ETF innovation market remains continue focus as with our competitive lineup in offerings like revenue we value, space products segments QQQ higher with smart to and Our differentiated on most beta, drive higher such for a

net growth with quarter years in have $XXX channel several growth in income organic these million now capabilities inflows, of Fixed pillars the million the both of in $XXX institutional and been fourth persisted and respectively. areas of for

a As capabilities fixed interest significant as pipeline XXXX. Allison in stabilize, income to levels. institutional rates will discuss And growth later, healthy at in capture remains our opportunity have we

fixed throughout to We in net class significantly well for rising asset in our XXXX, stroke income managers. higher yields world's fixed performed business quarter in experienced fastest-growing the market securities position long-term on bond asset Our leading the China lower. Greater outflows redemptions of in fourth million net modest China the $XXX values during industry and in exceptionally building due income

$X product over quarter raised launches we China. during new from in Despite the these billion challenges,

For growth as rates of infection, few rate in the turned XX% redemptions more period remainder COVID of said, Market the net the are That of billion is higher levels. in the return inflows, through works China there joint signs for sentiment equivalent delivered and the XXXX organic China. country a transition of year, next full to stabilizing outlook optimistic I'm and XXXX organic for rate. improving, months the our the venture interest to will also that moderate growth $X for China be mixed throughout

organic billion fourth remains quarter, momentum on developing markets capabilities, Although, the this outflows firm billion including maintain quarter biggest fund. with global net in of outflows the net key $X $X in of long-term Active experienced equity we growth drag billion. the $X.X in our

for client past, than discussed appetite for we previously, will in assets top these lower client will have this redemptions but appetite assets slow been I'm As optimistic, eventually risk return. the

at and sheet, years, XX a We billion the us balance low the Long-term to to entered environment. in this in strong our year-end. balance XXXX increased over remains lowest $X.X giving with operate at flexibility levels, debt strategically cash needed

As that we discretionary support expenses, to critical disciplined spending discussed are managing approach in to our to and organization and the continue last growth. quarter, limiting be future tightly we higher roles

of and We are deliver positive the resumes. managing as organic identifying leverage headwinds the recovers market growth expense market for We improvement long-term. that remain investing focused operating thoughtfully while areas on will

will capital in about in environment, resource well be deliver being growth. maintain that this We areas we and thoughtful to extremely positioned future are investments allocation

operating future and our for mindset We've Invesco organic growth. positioned pressing partnering is environment. the may will needs investment arise sentiment I'm and meet are of proud and this match. and employees industry decade Looking in confident on of talented in scale that be optimistic return stakeholders, direction XXXX a that in but ahead, market to have the accomplished Invesco talent can behalf clients XXXX uncertain, to our when to I'm challenges to we eases. dynamic Market meet prepared I'm our for in at of growth well that the what most past – build breadth few dedicated solutions clients and with capabilities

With that, it to over you. Allison, I'll turn

third equity several benchmark in quarter. short-term over we the quarter in improvement demand. strategies, is Thank These the performance results and XX% but everyone. fourth lacks managed in top where with investment start in certain strategies benchmark you, strength beating three-year with is performance funds in or and there of I'm morning, actively on income basis, improved strong Performance trending equity good five-year Marty, from up XX% past experienced strategies. and going global several and and the in and funds XX% key balanced of quarter the U.S. a half Slide reflect positively and fixed client Overall, to XX% in a peers X.

most Slide of We indices from in $XX Moving X. from AUM, of third $X.XX XXXX the to trillion quarter prior with quarter recovered ended as an the billion partially market increase end inclusive Global inflows increases, and billion, lows. were billion, $XX $XX into products. total and $XX foreign money exchange reinvested market increased movements net market by billion management dividends under of assets

billion, to peer active the long-term growth flow As performance Marty mentioned this this the some a the to decline. Invesco's firm was $X.X remained equivalent outflows in group. billion while and $X.X net net inflows capabilities in financial Despite our organic best X% net were of among outflows net earlier, subdued stabilization experienced strategies. quarter annualized Passive quarter, returned markets, industry quarter $XX.X in global billion in was fourth

strategies throughout organic the and fixed as enabled continued of areas investors key positive year to to growth, as positive offset delivered that well our along redemptions net also These for channel. XXXX. Invesco including ETFs and outflows trade income organic China the deliver Several with risk-off which our institutional growth as Greater full capability capabilities business, sought experienced

Invesco’s which ETF again are inflows BulletShares this lineup of Growth driver included was redemptions. a was with in of billion inclusive in $X.X quarter billion. in Net our ETFs, quarter broad-based. the net long-term once inflows fourth maturing $X.X gross were

Senior ETFs Our top-selling S&P XXX Loan the NASDAQ QQQM the Equal ETF. Weight, XXX Invesco included and

inflows For ETF capabilities the our net to equivalent and XXXX, rate long-term billion, we organic share. market were $XX an full XX% gained growth year into

QQQs, management. share total than Invesco industry of our assets captured higher inflows, X.X% Excluding under net X.X% of industry the

and in that fourth continued steady Institutional channel now quarter the been inflows. as of achieved straight has channel the net a source has of XX quarters growth

very channel We risk organic spectrum geographies, the X% the XXXX, return achieved well as challenging inflows as net This a $XX have demonstrates differentiated rate. and of year, the or year new classes market despite backdrop. diverse asset the the across the that billion nurtured we calendar relationships we range capabilities client the throughout set market. of fundings to growth sustained For of bring

ended. of fourth despite the flows investors a were quarter, pace as lower quarter an than and losses meaningfully the achieved in as outflows harvesting and both in positive the $X.X the the tax improved outflows ETF Americas flows channel in prior billion year Asia-Pacific net EMEA, uptick Retail in

inflows Australia. net led declined outflows improvement Net X. primarily $X.X Asia-Pacific in Americas EMEA, billion, were ETF Slide in to Net in and Japan to and Moving quarter-over-quarter due flows. by

experienced outflows COVID-XX joint a quarter venture markets. cases Our financial the modest China long-term fourth rise industry-wide million in redemptions and as in income impacted economy rapid spike meaningful experienced products China in a fixed Chinese the and of net throughout $XXX

the back we we products that, billion products long-term inflows. in equity of Despite into $X and raised quarter over fourth showed garnered billion where shifting $X.X signs investors net of from new

share. Looking an gaining net delivered billion and XX% XXXX, market inflows, joint venture of year growth at rate, full long-term organic our China $X we're

be the first products in a Chinese New Marty's on the have the after first remainder weeks there be is may driven of few drag China higher the and to through XXXX. flows the expect we XXXX, market Building remain transition points the of of persisted redemptions for new the in income. from experienced in through optimism increasing on may fixed net the and by launching Chinese fourth quarter the rest short-term quarter, in we Year, This earlier, though dynamic

remain achieved is for quarter management. be, as month. maturity growth firm market Fixed managers, heightened fastest-growing net organic last one net best in fourth on related the area, capabilities redemptions the asset well products and this income BulletShares $X.X $XXX we that their fixed million billion term, inflows outflow of the Chinese inflows. in what a positioned expected sustained with reached The asset as despite world's income the Longer to ETFs to in the planned

in to strong strategies billion alts have the $X.X gains Alternatives of As range first bank from of more primarily billion full appetites billion, offerings $X.X experienced income fourth by investment net commodity concentrated the experienced of for fund. focused half year. from our risk loan interest future ETFs. positioned outflows performance have of $X.X full $X developing the are net outflows growth. that equities, to net global outflows rates year, of in net driven due across outflows the the Private strategies in were primarily the in been stabilized, gave diverse durations and and we platform quarter. two-thirds markets for fixed accounted with quarter, than capture net inflows equity Liquid of outflows These Net but back and markets experience billion active including markets outflows developing the the strategies. which a

Moving to X. Slide

last billion are we Our environment, challenging which institutional equity $XX to end, pipeline active winning new income the in from at contributed an the quarter. fixed was increase. fourth and Despite the increase in notably quarter, $XX quarter billion mandates,

billion Our mid-$XX dating pleased see to given pipeline the pipeline this has been and to we’re XXXX, to environment. running market the in uncertain back late the robust billion mid-$XX range

to range causing previously, pipeline quarter fund downturn. to the of has we As cycle quarters versus funding the the mandates our some longer extended the and is uncertainty take into estimate we’ve to two prior noted to would market that four three three to

global Our diverse the channel organic solutions business mix throughout a The pipeline sustain fourth in institutional of clients. Invesco cycle. the one-third that growth the business reflects remains pipeline full and has the with it in enabled a quarter, capability differentiator helped

quarter, was under primarily significant assets X. September, quarter start Net to fourth under That’s billion due management. of revenue in flat XX% Slide fourth to of Turning $X.XX at management in assets lower prior the the fourth period. active that the lower recovered but we the billion the quarter, in the and and third lower $X.X – Markets XXXX. declines than quarter of market the especially partially experienced the drove quarter

fourth were to an the third $XX this $XX XXXX. operating the million, million by expenses of to on performance $XXX of of paid earned as quarter, in $XX inclusive incentive increased quarter, quarter of adjusted as and a $X from compared expenses million comp decrease Total million the quarter. the fees increase Compensation of prior million compared

manage company we variable full year discussed, performance with a outcome As competitive we’ve compensation line and practices. industry to in

Historically, annual has our net compensation XX% ratio been range the to to revenue in on basis. XX% an

the towards experienced we in revenue to end upper tends as ratio During XXXX, decline, periods the of of move range. this

ratio the end year we would the range revenue levels, to higher to towards AUM full XXXX, of XX%. XXXX. compensation For expect current the for the was our trend ratio At

taxes a $XX $XX revenue year incentive As with to We reminder, this fee seasonally million quarter. of we typically received and quarter, in seasonally million Marketing be activity quarter, benefits the higher of expenses see performance high quarter. first in expect marketing by prior consistent lower Though would consistent seasonally compensation expenses the compensation offset $X the to higher looking trends. after with fourth expect revenues lower million to million $X we largely fourth prior higher the fourth than were were quarter than XXXX. the on

million expenses higher were technology and the office $X Property, than quarter. prior

complete the be process our the As we of we’ve moving this we’re previously, year. Atlanta new which headquarters, to of middle to expect mentioned by in

experience are place in not moderate we’re delays pipes incurred burst in million parties also building. fourth around temperatures current repetitive December, cold may relevant bitterly In decommissioning our cause the result a quarter, of that as working expenses of and we related on office expenses when a flooding These $X nature. resolution. Atlanta took to However, to with we of

programs in cloud. the additional rate included million in movements investment to environment jurisdictions. G&A human prior expenses $XX impact added our in foreign such and the value of systems higher scale, were as that the our $X quarter the influenced will associated $X expenses million currency million taxes our benefit future than of paid ongoing with upgrading financial technology and non-U.S. balance Technology resources move fourth quarter, sheet, by of exchange an on of revaluations operating

These and included results. investing property, span future earlier, expenses, are that we in our and platform. are expenses and will scale in projects office mentioned I As technology foundational they our SG&A technology enable in operating

balancing manage We’re growth while environment. in the capabilities, this diligently expenses investing in to our need uncertain key

other in we’ve near-term growth focused and areas hiring most have positions. hiring the deferred that We outlined for

that will efficiently we’re scale, positive longer-term, delivering markets the platform as operating building recover. margin Over leverage and a rapidly and expansion

$XXX XX.X% fourth revenues was capital to Slide driven than in higher to higher Adjusted the income was moving operating quarter, the and million prior as quarter Now in the fourth and of compared per Earnings XXXX XX% to was $X.XX flat quarter seed operating X. prior $X.XX XX.X% due that our as the net lower experienced quarter XXXX. combined margin expenses. to operating as to in to Adjusted co-investment on steep in $XX with million the third declines gains market from due markets portfolios share by third income we non-operating increased quarter lows. compared

tax and estimate effective items. and pre-tax XX% be items due The rate not this may did in last than between to to XXXX. tax tax The quarter effective first to XX.X% lower quarter due discreet lower on recur. impact jurisdictions rate for XX.X% income from non-recurring tax tax in fourth our and losses prior was non-GAAP quarter the We that effective vary of XX% the actual of the quarter rate estimate the

conclude Maintaining sheet debt that a a volatile more which navigating. is balance million quarter the XX. managed remains XX, on of and billion as cash with billion lower an in Total environment further $X.X Slide XX. we increase the priority, $X.X XX We top in underscored going of level to to was by in built than the December have we equivalents, years. strong year as I’m September lowest from ended over cash cash the fourth $XXX been

have the lower the higher third as the slightly X.Xx led declining Our quarter markets EBITDA. the our than as at facility to credit quarter, leverage defined agreement end of under fourth ratio was X.Xx

preferred and balance client of X.Xx. times. capture leverage was our If and in the past XXXX. in demand our been peer performance quarter been to included growth was is the half we’ve group. the the stock continues sheet to net ratio uncertain fourth Our of fourth the among building one has Meanwhile, quarter of strength areas, needed In navigate of markets high flat best face these in flexibility Invesco most our ratio leverage financial challenging century, flow

that resource clients for expense growth. in the while disciplined the of positioning and extremely management are long-term be firm will meeting our allocation, We and needs ensuring we

and With that, Q&A. for it open we’re going to go up ahead

Glenn your with is Instructions] [Operator Schorr Evercore, open. line

very Thanks much. Hi.

And great when much We question like up this getting flows the new you years, give Is I launch don’t of come just through us $X wonder ask day products, on. get the from set develop when of I’d pipeline? color the bulk seem seem question, reason as to billion scale. the the little real my developing products. over flows products. on huge my obviously And great you a you’ve profitability the the but a is flows could talk last a about to it on products. historically is, or flows be of the one. legacy I if new the hit Just older new products done your opening couple best more standpoint a issued bit, new the trend. new why you through come seeing you watched of we little on I guess most

I that’d great. Thanks. help with wonder color you that if So could be

and Yes. let chime me start please Glenn, Allison, in.

ongoing of the And States comes to market. really that’s get to be but them – to something flows In But just have really those very a and you launches. little unique your these how to bulk launches, it’s are there the now. through time inflows, look, of mature operating where into on market similar there more it had the capabilities. will you’ll fewer you’ll it’s right the that United have follow is again, So

over here, is future we evolve really a very just volatile us. when hit time. in again, COVID this, time I it’ll Allison think being a next few think the itself, bright anticipate over But want very, for on strong – but very year It’s the we That transition China in months the completes I And to said, did. China. XXXX I just

if would to come with Yes. say maybe think these Glenn, maybe any a product market you right it’s launches, somewhere and quarter new certainly now these for impression really part leave it about half mature of of China, way that that’s said, is And China there not flow is beyond the to market important market as new in I China the two-thirds an Marty mean But don’t drivers of maybe given but important flows. in it’s with all from a less flows is the now. I it’s might in share flow of driver product market. large a each It’s the your nice XXX% it, works an interesting and It’s launches. it region. – that the now. overall. is But see I to growth anyone point, want across the driver To drivers right of quarter. an in from it’s coming time it’s functioning

Maybe Thanks, was guess in so some revenue. in you to quarter Okay. the Allison. of margins X.X% or expenses, for quarter, so Market your into one general. up fourth flow through I first the up was AUM on quick – one – the that’s going

Thanks. Because so could items us start, just think to the some seasonal point you the in on about side, the first quarter. off maybe point with sometimes So jumping starting expense off QX? jumping the on how just there’s help

are Sure. takes. and There puts many

the equity quarter. as few active better off billion portfolio the think that in international you’re well the you – we as encouraging developing only jumping a the it, really in we mix we a to, Those we our same as impact has we’ve about to into than in the to particular are portfolio. of But as fourth outflows the But capabilities I as dynamics. overall markets we’ve shift that revenue have inflows, understand revenue of see a weeks strategies, pointed pointed of signs $X strength in certainly January. positive. the as see that point markets in about our We a a of different fixed global some real do important underscore and At funds. we That’s at experienced certainly I in little overall think lot think income been the it’s an in think right, ETF saw bit the side two as as what particular. comes revenue of time, remixing and level

positive there’s in jumping headwind remixing point market a in this quarters. off of a while also relative of quarter, So to a could be the terms prior bit

what not seasonality expect should quarter to like fees recurrence adjust we about noted would course offset will – million would be As seasonality by usual expect there. will just be, be the performance what of That first we we would we’ll expenses, the saw the market I think of the overall any in and million you for expense, given in in comp And $XX $XX market quarter. fourth that. the a

about the that lot hopefully and puts a of well. because arms trying a So of around the as time some to navigate color bit we’re difficult that little you and our think see of a gives forces you same get as at to environment moving Overall it’s takes.

now Thank Deutsche Bedell you. Brian And Bank. with

thanks. that expenses, Good Thanks like XQ. office number just said I one-time that in finish my missed for it that I more technology think just property to you seemed taking in Allison, on folks. morning thought, the Maybe one – and questions. just Great, the was

you’re an in that then for sounds you like on also in spiked can. cost off new saves So I the that year headquarters. in to outlook some XXXX considering up the did as But but you’re want have you realized first just point jumping in expense some think also half, get I to context working XQ, in duplicate there? that you if G&A. transition maybe And going during G&A it to the

Sure.

Atlanta of my walk On to these. our a of, experiencing technology, what on few to try really me property through specific to Let points of a and best we’re some do couple headquarters. office

$X million That now. we somewhere to As related few headquarters expense. million in. million of non-recurring had fourth quarter a We existing, reminder, $X the we’re for decommissioning outgoing two $X charge carrying That’s to are will in a of right I’ll a between more say or headquarters the incremental persist quarters. the cost

burst We some because had also in delay that and in Christmas we around new on pipe building moving. our pointed that happened to will Eve cause a some and uncertainty, Atlanta

work little so what right And there bit a of all as means. through to this is of now uncertainty try we

combined say, G&A, with terms pretty and saw in G&A, over foundational overall lot of they will those to a key and VAT in as these we continue has and a think we about taxes categories and technology, I I movements some on FX are just pointed really to fourth significant FX would we that two That a lot revaluations technology services. professional underscore quarters G&A, property driver we in of office there. quarter meaningful of of in the obviously spam the working both higher been projects the and last few

on have new environment. been We – we are installing HR working in a

stages and we early up the cloud, wrapping to financial of in all Alpha NextGen. are our the are systems We of moving

the there rolling quite And focus so as these really scale off right and and are a projects for and now creating rolling on is investment future. of bit

last when an think back and but think basis, really these as management year last foundational of G&A as reopening as travel of allow are China year, able that we to three the to be some for the been G&A average not about on and the you an do discretionary travel we’re G&A expect in have the a we expense well for to with Overall, expect do year full we we about mode year somewhat on years. consistent region get average to same fact this efficiencies making. the is that time, a this expect important some back – basis I investments and get us reopening at to the of our manage, to to trying I of the

just color. just complex the Funds Oppenheimer on then of a the revenue there. you. follow pressured, that in outflows up given to side, the fantastic yields Thank lot obviously That’s And sounds came the like revenue

to with would but advisors question speaking are on Are part foreign performance? be, risk some from two not risk starting their pretty can that increasing that you’re you the appetite year. seeing are in help Probably as markets So especially year are XQ, their rebounds? given or appetite if to that yield warm financial we seeing well to markets clients demand that starting off move emerging and revenue through in and you up

contrast make there is, I’ll it’s is risk right? talented markets emerging markets off emerging was If very what at year you like, by particular went just last comment. But no the a Yes. too dramatic, much The really to in quite in performance, early. seeing through And interest in some and really in and be we interest driven early to starting very, China, some very it’s are markets needs a very, China, solid team. frankly. had QX have, developing in which all

should well, past year. the a do which from be is, So if appetite client we would there quite nice is the change this answer

Great. Thank you.

you. Thank

Dan Jefferies. Fannon next with Our

morning. of wanted Thanks. the Good suite I on up products. alternative to follow

you But within You saw said shaking liquid you little talk where alternatives goes. of a some credit? some think about and you is highlight Could second quarter seeing fees and private as of Or the mix the This outflows. consecutive strategies negatives outflows. and of are I more elevated kind inflows, out? of did the the positive

we start, of outflows in. saw would be I the I’ll things as alternatives. would at we in a what look say couple alternatives, I chime terms of a again, liquid Marty, of mean, Sure. lot

currency in commodity So ETFs. particular, ETFs

direct but be $X.X those would were billion, lower loans, at an was real driven alternatives the tune perspective were $XXX private that that would flowing outflows from that an fee bank down that think be to I of million – So, largely to global markets by out. Boiling that about that there. estate, outflows we about was also

and again, commitments a that’s $XXX powder So and net into about side. million. there, estate acquisitions real gather dry of direct overall of amount on really, billion $X.X Continue have negative to year realizations coming that fair the

fears just perspective, environment. year an loans floating the credit it’s an a was private of of losses, appetite persist not interesting a the overall, It certainly – I there navigate think of impacts for it’s attractive On have some may recession overall. what interesting like, but helped and nature that trying mitigate credit been look and certainly as or may to fundamentals credit kind rate private that

navigate continue we to so And that.

coming year, really all see well market have will demand into very client that we’re they’re expect be of well we private to I that be think the asset feel our launching this we like funds positioned. on classes. going about we’re feel bullish We launched to good this where year. We and and positioned we, for

But come higher to yields thus. going attractive perspective the we is as together certainly through really and quarter-to-quarter how flows on our point dictate it make your what entry

think overall some of there. overall commodities and and have But see to continue So, and I the the downward there. we’ll pressure movements put flows currencies the strong on alt liquid demand good

pickup then kind you. Thank rate think key for it. Marty, is the of Got is positive and income, making. stabilizing but interest factor fixed And positioning you’re I the said for you for demand, and and think, obviously decision helpful mentioned need you to, I you

on in of or we So, basis and stagnant of much and feel redemption then start activity, see a you think a kind as where sales assets we get do so more we about more rates direction are more of growth to like global motion? it’s

Yes, absolutely.

capabilities Wirehouse we’re talked look, very is be is follow But to think performance. point year. management going important markets on things And now wealth equities for investors some of is broad thing being private year. of that’s going good we’ve case. in for. very underway. will I But follow to up be how of future over Some react really, multi on quarter really I’ll which on capabilities, development a end that’s introduction. which [ph], one we’re back the Allison’s in also important And will last to on of right? launched in be absolutely the in the our for income, a now also, a So, true we’re just the REIT, the this set waiting that But that the about again, channel. of to certainty It It’s fixed a

moving which now really forward, won’t is be this important again, a for it’s we’re but thing So the immediate, firm.

you. Thank

you. Thank

Brennan UBS. Hawken Now, with

on on you my release week were questions. some slower flows, maybe start in some waiting Thank the love side. in funding the the suggesting, start you to morning. had institutional taking of on We’d a recovery press a Marty, commentary China, you to for indications, flows. Good

you you are given can all soft flows generally expecting on uncertainty the that you’re based signaling see that what remain to So that you’ve here, here? about talked activity just in

the don’t a than change I line Yes, in you the at look a really as to right? look, we’re, we’re point rational that’s end from I our of vis-à-vis flows, get meaningful a relative beginning. to what that our lot need perspective, there, just you and we our my And impact is well we’re competitors would There’s sentiment say, of the to lot uncertainty closer start think really things of lot make a positioned. going how are a to flows. and But

closer really to bottom, we’re going so a but that’s And for Invesco. a the as development I at lot don’t think ring that, and say, bell positive to be the they they

drivers those negative now, the positive rate. fourth rate up the decay quarter market third the sentiment Brennan, is again, saw Yes, we some to the through that the expect That drivers third there not this to decay to and quarter. improvement Yes, but might in to saw right a from Look, dangerous of the game, overall X.X%. at quarter certainly the to the game, quarter X% and point quarter. just of really and try predict enter that to would coming hold going look we the continue out it’s fourth to was we dangerous improved flows, the first but to I quarter in a as game a we we’re some just

platform ETF year the tax there So lot bullet and the shares maturity, in particular X% loss the into in and harvesting our strategies of strength fourth again, the the coming a of there. some quarter. Despite growth organic

a income the the performed bit we But Fixed we’ve rate environment. have for on hinges fundamentals discussed quite there. has the certainly strong well are feel like reasons just and

seem institutional end we’re to beginning. closer be We’re The back than Marty’s that positioned. underscoring is does well point to channel coming perhaps the the

depend could lot conviction some on as improve waiting sideline, so, the on this that, remix we and institutions – quarter. a at saw of sit that here And

the us fourth in equities quarter difficult quarter. for Active very

right some and China. a come there. strategy markets be I really also find impact, diminishment think a [ph], that on And moment the short headwind and they’ve as bit. around COVID it’s we is but conversation into exposure people will and there lot their as and class that are still and depends just having to is a wildcard expect of developing time earlier XXX term just that relatively back a done the asset fundamentals really real that strong to quite us the the help then And at unique. What’s the changed happening

better moment feel a or think, we see been things a I the sure that wild ride maybe did bit is the hard But a to because And place little be over a a go next of we’ll ago. we two. month where year. at quarter than So, it’s

side, that prioritization been a products around think, learned there’s that the and on you’re the about that light on launch and product the that very Shifting structuring estate lessons some a in real the you’re adjustments? estate warehouse some on How but looking sense. Marty, positive front. gears relationships one, on dance the delicate believe thinking I damaged? just rather It’s given how wealth are year some which redemptions on referenced queue, some customer some of I addressing for make there maybe that close at and yet commentary products perfect order the product. in getting other of managing service not you investors, the And seen needs and made sure management aren’t Allison, we’ve to you side? all some of of how the own you these to a sort your shook there? your you sustained And little number of press thinking to on of building queue the you real retail have gates what guess, in been struggles the the the institutional And I are makes then, Thank addressing and side, about how making color. helpful. you on is capabilities very, out That there.

issue. great of where I’d Look, to we’ve needless and the it’s size say everybody. has magnitude that say have don’t a question been that front it’s not Yes, topical. that also we of in of had been sort

that. the job do situations client think for of very you capabilities. these So with recognize that’s experience they’re creating have capabilities has And lesson in these some exposures, been is And would they market. a different. times, and availability be perspective – again, what if for get do really I necessary that’s I to educating that these again, we But comes along my challenging time that you’re the personal relative want scale into into our I like think to well. run horizons really good if the extremely going And a to investors going is some to exposure

I to make an not during would individual extremely just investors to provide So have a not time. to decision – access challenging

helpful, think how that’s I know about it. that’s I So if but don’t

the institutional side? on And then

sorry, I’m can question? repeat the you

press – but through capabilities around And take strategy. – – a of and investors large estate you the some to Yes. on illiquid the to to rather it’s the institutional given going that commercial fact existing prioritization there’s real given There coverage the was work that. queue nature, redemptions, actual they’re institutional there’s your time the in

but and that inherent dance to relationships go limiting are friction? control damage try balance, just an it’s so how maybe far understandable around And as you sustaining as to

We’re describing. not you’re experiencing what

it’s when we and have reductions, they’re there managed relationships well. really are with very strong very, So our – clients quite

the you’re to. friction referring we’re So feeling not that

So…

Thanks. follow I’ll later. Okay. up

very you Yes. Thank much.

you. Thank

Craig Siegenthaler with Bank of Now, America.

Hey, good morning, everyone.

Craig.

have the And then view you these do in in wanted within that mix fixed to reallocations to rates, the positioned income potential on just I active between view win have rebalancing? rise the XXXX? on think the And you you passive? potential also within given and So potential do we’ve in interest a seen that a see Invesco that if how is

give question sure get into natural I’ll It’s rate levels I answer. think more interest and wrong. a you it’s getting, marketplace. great healthy But net-net rates rise the I’m is the in for an interest

stock said time. And level, for equities asset over of healthy I sort you’ve fixed it’s good it active incomes different as time classes are, I before, think again, don’t its and once types stability for hits think I been positive what of know relative for market a that it’s really [Ph] had say. allocations equity. the and active a but long pickers it’s it’s I where

popular And not to my elements case. been But I go suggest history that to that equities a personal start money probably And and outperformance, active how about relative you view. it. you’ll once of yes, see would view, it. not And get think back the be that’s that’s various

maybe Thank a a you, real Marty. follow-up just And on other different way. maybe the estate, on question asking

debt other the your So in have we great especially core XXXX? the trended real INREIT’s in really products estate into public some investment I’m also talk performance. you and the about for I products, visibility could private of and think looking also funds performance how opportunistic liquid drawdowns? maybe But the

will client relationship strong the front to a very, over strength What it’s long specific it’s hard strong and strong team. question. in – exceeding so very organization I the capability Look, very to have don’t the performance of me, period answer a is, say a fundamental very, just been core an I of a has The time.

the sorry, I’m specific I don’t about. you’re again, So performance that have asking

Guys, worries. thanks Marty. for you, Thank No taking questions. my

it. Appreciate

And now, Goldman Alex Sachs. Blostein with

how fixed a your you recent active some to around income products that and Marty of fixed just with hoping was fixed guys maybe most in Invesco’s around position question specific feel about about you And Hey income Allison. recovery give thinking Quick, follow-up some the versus from income. flows income? in book quick industry you the of if the optimistic ETF the are positioning I and kind could fixed Craig’s continues. details

I’ll make couple a comments.

ETF the fixed opportunity think historically has the equities. continues to Just We income to – we ETF from franchise, be surely have with right? franchise grow come strength within an the The our income. off capabilities and fixed us, for

we of look particular, quite really suite regard into year. So is to the income strong. at [indiscernible] With would capabilities in performance of going the fixed

a There’s we to the what duration by attractive very Bank retail be be driven the our in to the So client continue United muni in short bonds munis, going in elements. States, see strong. really loans it’s the channels all been very is demands.

we the and further you on So do where perspective? any again, market from But your are. Allison, it depends have insights

inflation in to be see mean, is whenever movements, be some that overall. strong we We think, you least sometime Fed to – returns XXXX. would at that inflation No, expect I it think and and expect with rate the well, declines to total start I I pausing

being that that I hit strength. as on think real the we focus to continue to course customers this expect our Marty the more bullish as see hear of over year. even Munis, area taxes we sentiment areas an of on certainly,

time. held that’s continue demand very is us wrapper up liquidity been very area be in nicely us value income been continues global strong Our to for has for Fixed a for Stable demand. and very leading expect we to that a capability long SMAs there. real that’s a a

and we continued our there rates it of be this expect credit course. inflection depend year. perspective But does on really think, I to a So, lot across do capabilities your on and demand of point an

but ETFs of active both. in strategies, feel net some over positioned well our I we think flows favoring overall are still

resume build operate little it. I opens capital just liquidity you strategically. expand return environment is program? to opportunities for mentioned balance you Or then, think sort of and the then for do strong you Thanks around that. bit a And mean up think and Marty, sort you more commentary enabling M&A that? you’ve Does Invesco? sheet that this made on Got it Could active eventually incremental of

Yes.

up. comment me pick Let can then make a Allison

are grow been to for in to it we’ve about really any other in company talked now, are investment that balance right continue we’ve going sheet what So, and ways future. our for different the using

MassMutual an to amazing where partner time. this continue capabilities, helping we’ve us Yes, we’ll been the sheet using And balance been really you’ve sheet. So that. very talk scenario, do to over has the balance a our alternative degree. us augment to material heard

what if really Allison that in to. creates some not was be more might foundational that’s the programs we’re scale enterprise They talking but these that’s “interesting” within organization. been of So now they’re referring necessary, about specific an

other using up to on the way Allison, we’ve And that term. balance you want short pick other been so elements very, of more that’s But sheet? the the very

thoughtful think, our Yes, focused stewards our supporting be But hit maintaining I part growth future really points. capital a overall, balance some good really of the on be do And strong and I again, that shipping of of on for there, It’s to away mind progress focus again, making the about about we’re to to has which us and top really been the we’ve making debt that. of on and the continue there. balance own we freeing up mean, continue to been is high just very sheet, to growth. at future good sheet capacity progress our feel Marty us continuing being for

product Some is investing launches. our of in that

of strong capabilities helpful? continue both there terms foundational we in investing we years. ourselves, have that’s really the have to projects really partner necessary to technology expect business launches, really But fortunate over us. that and with are but product a the to prioritize in the good this of be are Hopefully, some the to that create going we also coming scale know and We our to strategic

much. so Thanks Yes.

with Thank you. Suisse. Credit Bill Katz

open. is line Your

for Terrific. all very Thank Appreciate questions. the so and And for if taking and China could does colors you assets Allison, launches the product equity for other sound mentioned queue super fixed a down mix in outlook break you help you helpful. have the much That’d you and where a about longer-term region? bit the be little for you Could both sort Marty of strong. far. unpack very income between the XXXX?

it. take stab balanced the demand exactly, hard of Sure. at say equities. but say I’ll to I and there does income product terms launches, would in a tell overall, favor Well, fixed over products you I’ll

income so about income balance it’s just perfect it mix fixed as or than a popular the in So bit I would is probably overall Balanced balanced more asset a I fixed to as the skew China. XX%. that’s say would little probably as very there. maybe side a science, think than and not XX% skews much But equity. class

the you bit overall So little might States. smaller a there expect in and equity relative portfolio in a see mix the what to to United probably is

of Okay, of you where outs to about just year we does you channels? the for drivers hear presume think on given follow-up the across gradual geographies should all today decline entering and sort fee When that the XXXX, thank sort flows. products different you. just exiting distribution base and a and sit between rate And certainly the ins

quarter, passive into a and and factors revenue the for yield continue those quarter say benefit impacted the base of demand that would in the from fee to I primarily the Yes, the lot we net I as expect just continue fourth mean, overall first the to strategy. our would our the rate we ETF

put three that downward at in capturing developing demand would trends because a into our markets redemptions asset that come significant a rate. we while that continue pressure this there terms are particular a quarters and right So on headwind. average what to is that overall, of put demand expect probably outflows else, in And those positive, now we quarter is last of equities. given year, fee happens that pressure lot does particular exit we the we the rate there. into the of overall does And remain downward of those If demand nothing global where classes in just first as in December the experienced will and in

a fee quarter, do we’re an yield focused say, revenue rate. managing And I overall every not to though, I’ll just as net on or average

and income managing the overall. operating focused company margin We’re on the of operating

And accelerate did so in our pressure that and shift given portfolio, that in really while mix XXXX. we the mix see downward shift

do business We the operate we are to to capabilities. create to and really focused on scale passive continue to get how and scale these

a getting ultimately of growth our in what’s years, not scale reallocate to remix share, scale bit and expenses primary to terms margin. at those organic going higher to market And capabilities give growth the these in capabilities gained quite is and but us that’s continuing improve we’re over few against taken and we’ve the last operating We’ve opportunity our our focus. to

much. very you Thank

now Patrick with And Davitt Research. Autonomous

ratings. one have one mine just of Most asked, everyone. credit quick morning good on been Hi,

is expectation speak are back over the period outlook to leverage that a recovery ratio much went XQ. record I kind in which the preferred could suppose And of past new the be the of have based in that you risks issue? that we after times and will on to could investment or can your times your ratings grace times, potential S&Ps three with quarter? two which their think below market that on I half expect around saying your you to capital agencies times and three any already how the a three from ratings breaching for on outlook return bogey experience, based one range,

Hi, – are a we no we’ve would there. that. had risk take conversations we S&P Patrick, have Look, with indicate I’ll that

important I our the done in the work is lower. think all balances manage point to continuing have debt we

given impact, temporary would the So, nature. expect be has market while in declined, to EBITDA one more that

lowest only well. the the debt managed sheet in XX they three but Given point. And level number contingent all have statement to been on when as to years at excuse we do managed same expect at the not there that years, liabilities some been inflection, the Those be will that would’ve an present in market balance the time we’ve made care of a me, of ago. taken absolute two

ago. are So upgrade in We overall credit our as good a few in as do terms they better than receive of from feel liabilities, significantly far an are that concerned. the a We we years year were place did we Fitch. statement when last made a overall like position in ratings we’re

you. helpful. Thank That’s

with Cyprys Mike Morgan Stanley.

Your line is open.

again here. squeezing Hey, for good morning. me Thanks

just run Just of couple you as the and look kind are you that the bookends I to this much and next Allison, for you out coming year, think transformational that mentioning expenses, of on lower project were about follow-up rate might back as expenses? the how thinking to guess how over for rate just years, growth earlier. you expenses expenses about

years. So to of say will would lowering couple lowering in in contribute of the next transformational expenses in terms couple they I projects, the of next not expenses years,

will before, is most really noted making. that be Alpha our significant we’ve the investment NextGen we As

next side. some of will then in decommission of years the be into period can and on couple period of time parallel deep we’ll investment the before that, other running and start for apps We be to the streamline we

us move as we from of about to investment. overall near-term as it’s the the several right that benefit long-term are away we for So, building years company a the Again, seeing that and an be will years. at But time it’s scale see the in on seven next we years, it we to the before investment. some payback and want five years, investment XX take think

the look In bookends biggest the related. and terms that’s going be be that’s expenses, biggest of to of of the driver to going market driver comp of

so our And expectations And think we as the as comes that beyond we all I good must it’s only, focused sure variability think think our the clear, really already are it that managing would beyond right and and haves move, with level in and you I to I most be and haves we things to on expenses and about on of compensation year? nice we expense the the have want the discretionary what are news now The are flex expenses the at foregoing. could make related. every about what is some guidance revenue. that gave

But capture in we of there the position well the a some several create haves future. years. the the demand reallocating well on think And And to want stay course even for leverage serve are the of over these in that must some to that these and lot to we that expenses really us we’re conditions. market this us investments next think discretionary of operating foundational we challenging will business

do the just that might you. discretionary? Thank buybacks how the position, where And about cash resume? a you think on how question is And $X.X scenario follow-up of billion, Great. much

than So really the last a bit million held that’s quarter, the $X.X and it’s billion, is purposes, related. for little $XXX regulatory higher about so FX

So amount you roughly $XXX discretionary. million above the could that consider

buybacks, our about capital think I’ll underscore I priorities. As just

lot run. levels want And is make balance for really also The and focus think investments continue that and capital first down. excess of that the shareholders focus to the that and we’re managing we focus future but that to continue on got about those we our it’s strong over shareholders, and to supporting first long dividends we’ll dividend have we’ve think best going we sheet returning ourselves, We that’s a to cash we maintaining serve want in buybacks. through leverage growth, to steady on and going do to increases, the and on

Great. Thank you

anything Marty, else?

on mute. this excuse I do I expenses. just to follow-up get conversation want Yes, on me. off

the talked Allison capabilities call, the as obvious talking about, a scale and on some, that we longer some was what we discretionary. about investments term and there’s are a in opportunity say, that, constantly in capability a that client elements then which management bottom into have And that driving deeply organization to it. it we’re from absolutely to the the for within client, So around against you or line. get demand. decision focused process make we’re we’ve team, dropped let’s doing a But are And at invest

working very, very So that’s another on element been have that we diligently.

get organization. with, at us you’ll the point same company, at markets better but leverage some further the the make operating from it’ll time, recover, And a

you nothing think it I So, three different elements, should that’s at as look new. and

do You’ve just again. and from and it, better shareholders And outcomes it’ll and sure, seen it’s for time create practice clients. us again, us a time normal

question from Sir, Brown your with open. Our Mike KBW. is last is line

Great. questions business. Hi, good a I on real couple morning. wanted follow-up you ask estate to the

total and the real exposure is estate in $XX billion estate direct real for believe around I So, so the side. is or Invesco $XX billion

much how estate, the tied and office to and real direct then retail? is U.S. tied within to So much is how

to managing I’d two-thirds to roughly, I much the is on been but up would follow how probably of to I’d particular. you specifics cold and a be tied is probably say storage roughly. say can years with have our expect exposure U.S., We’ve in us buildings there, terms we classes would asset – probably office and to in. couple classes years, in retail quite the you and like last medical over of industrial favoring three And some office bit asset and, really the of around

been the years. five of probably So the COVID been long for quite those has known obviously challenged six or exposure. quite managing been and around time, Office we’ve a retail since advent years story has

high I not focused three been real concern as last our been class And are or Multifamily been be really these another about would areas real we’ve demand. over those think asset overall. have a So an they’ve two in of favoring. where acquisitions the of years, example

Allison. do of how terms much And of then in line and Thanks then fees the real just $XX of much revenue? estate contribute how estate contribute great. other how some real specifically much Okay, items So the real here, does from to was fees? to estate, performance million, transaction

from the So on would’ve this saw about you IGW real was fees than estate years, what of China fees. coming we quarter think the year. the more seen performance If majority prior overall I performance this

biggest be from estate, given So but any it real more in in estate. coming the XXXX two was China would and real definitely year drivers

quarter of say I’d – real fees. terms transaction I in a fourth is. on estate of higher have would revenue revenue, by other say come driven it’s I was largely In in portion it back to to the other what will you increase the

for there. Okay, color great. the Thanks

thank everybody next and Okay. we’ll the chatting the be questions appreciate much very quarter. Well look you engagement,

day. the of rest good a have you. Thank So

Thank you.

Again, go concluded. you participation. time. disconnect and this has thank for Conference ahead your Please at