10-KPeriod: FY2024

AFFILIATED MANAGERS GROUP, INC. Annual Report, Year Ended Dec 31, 2024

Filed February 14, 2025For Securities:AMGMGRBMGRMGRDMGRE

Summary

Affiliated Managers Group, Inc. (AMG) reported total assets under management (AUM) of $708 billion as of December 31, 2024, a 5% increase from the previous year, primarily driven by positive investment performance. Aggregate fees grew by 3% to $5.24 billion, supported by an increase in asset-based fees, though performance-based fees saw a decrease. The company's net income (controlling interest) for the year was $511.6 million, a 24% decrease compared to the prior year, impacted by a one-time gain in the previous year from the sale of an affiliate and a decrease in investment and other income. Adjusted EBITDA (controlling interest) showed resilience, increasing by 4% to $973.1 million, driven by new affiliate investments and performance fees. AMG continued its commitment to returning capital to shareholders, with approximately $710 million in share repurchases during the year. Strategically, AMG continues to focus on expanding its alternatives business, particularly in private markets and liquid alternatives, as evidenced by growth in these AUM categories. The company also highlighted its strong financial position, with a significant cash balance and access to its revolving credit facility. Key risk factors include competition, reliance on investment performance for fees, and potential impacts from market volatility, although the company's diversified affiliate base and strategy aim to mitigate these risks.

Financial Statements
Beta
Revenue$2.04B
SG&A Expenses$376.50M
Operating Expenses$1.51B
Net Income$511.60M
EPS (Basic)$16.45
EPS (Diluted)$15.13
Shares Outstanding (Basic)31.10M
Shares Outstanding (Diluted)36.10M

Key Highlights

  • 1Assets Under Management (AUM) grew to $708 billion by year-end 2024, up 5% year-over-year, driven by investment performance.
  • 2Aggregate fees increased by 3% to $5.24 billion, with asset-based fees showing growth offsetting a decline in performance-based fees.
  • 3Net income (controlling interest) decreased by 24% to $511.6 million, primarily due to a prior year gain on affiliate sale and lower investment income.
  • 4Adjusted EBITDA (controlling interest) increased by 4% to $973.1 million, indicating operational strength from new affiliate investments and performance fees.
  • 5The company repurchased approximately $710 million of its common stock during the year, demonstrating a commitment to shareholder returns.
  • 6Strategic focus remains on growing alternative strategies, with private markets and liquid alternatives showing increased AUM.
  • 7The company ended the year with a strong liquidity position, holding $950 million in cash and cash equivalents and having full capacity under its revolving credit facility.

Frequently Asked Questions

In 2024, AMG saw a 5% increase in Assets Under Management (AUM) to $708 billion, driven by positive investment performance. Aggregate fees grew by 3% to $5.24 billion. However, Net Income (controlling interest) decreased by 24% to $511.6 million, mainly due to a significant gain recognized in the prior year from an affiliate sale and a decrease in investment and other income. Adjusted EBITDA (controlling interest) demonstrated growth, rising 4% to $973.1 million, reflecting ongoing investments in new affiliates and performance fees.

AMG's strategy centers on partnering with and investing in high-quality independent investment firms, with a continued emphasis on growing its alternatives business, specifically private markets and liquid alternatives. These areas saw increased AUM in 2024. The company also focuses on enhancing its existing affiliates through strategic capabilities like growth capital and distribution, aiming to diversify its offerings and earnings stability across market cycles.

AMG returned significant capital to shareholders in 2024 through share repurchases totaling approximately $710 million. The company also maintains a strong balance sheet with $950 million in cash and cash equivalents and full capacity under its revolving credit facility, indicating a solid liquidity position to fund future growth initiatives, strategic investments, and continued capital returns.

Key risks identified include intense competition within the investment management industry, the dependence on investment performance for fee generation, and the potential negative impact of market volatility on AUM and fees. Other risks involve the company's structured partnership model, which can introduce complexities in revenue and expense sharing, and cybersecurity threats to its and its affiliates' operations and data.