10-QPeriod: Q3 FY2015

AFFILIATED MANAGERS GROUP, INC. Quarterly Report for Q3 Ended Sep 30, 2015

Filed November 9, 2015For Securities:AMGMGRBMGRMGRDMGRE

Summary

Affiliated Managers Group, Inc. (AMG) reported solid financial results for the nine months ended September 30, 2015, demonstrating growth in Net Income (controlling interest) by 31% year-over-year to $365.7 million and a 32% increase in diluted Earnings Per Share (EPS) to $6.57. While total revenue saw a modest 1% increase to $1.89 billion, driven by growth in the Mutual Fund and High Net Worth distribution channels, the company experienced a slight decrease in Assets Under Management (AUM) to $593.8 billion due to market changes. However, the company strategically managed its expenses, with total operating expenses remaining flat year-over-year, indicating effective cost control. AMG also continued its active capital allocation strategy, repurchasing approximately $379.6 million of its common stock during the period and strengthening its credit facilities with a new $1.3 billion revolving credit facility and a $350 million term loan.

Financial Highlights

39 data points
Beta

Net Income

$107.70M

EPS (Diluted)

$1.96

Total Assets

$7.54B

Cash & Equivalents

$541.70M

Free Cash Flow

$371.90M

Financial Statements
Beta
SG&A Expenses$107.50M
Operating Expenses$397.90M
Operating Income$215.20M
Interest Expense$23.60M
Net Income$107.70M
EPS (Basic)$1.99
EPS (Diluted)$1.96
Shares Outstanding (Basic)54.20M
Shares Outstanding (Diluted)57.00M

Key Highlights

  • 1Net Income (controlling interest) grew 31% to $365.7 million for the nine months ended September 30, 2015.
  • 2Diluted Earnings Per Share (EPS) increased by 32% to $6.57 for the same period.
  • 3Total revenue increased by 1% to $1.89 billion for the nine months ended September 30, 2015.
  • 4Assets Under Management (AUM) decreased slightly to $593.8 billion, primarily due to market changes.
  • 5Total operating expenses remained flat year-over-year, demonstrating effective cost management.
  • 6The company repurchased approximately $379.6 million of its common stock during the nine months ended September 30, 2015.
  • 7AMG secured a new $1.3 billion revolving credit facility and a $350 million term loan, enhancing its financial flexibility.

Frequently Asked Questions

For the nine months ended September 30, 2015, AMG reported a total revenue of $1.89 billion, a slight increase of 1% compared to $1.87 billion in the prior year. Net income attributable to controlling interest saw significant growth, increasing by 31% to $365.7 million from $279.5 million. Diluted Earnings Per Share (EPS) also rose substantially by 32% to $6.57 from $4.98.

AMG's total Assets Under Management (AUM) decreased by 1% to $593.8 billion as of September 30, 2015. The primary reason for this decrease was negative market changes, which reduced AUM by $35.9 billion. This was partially offset by new investments and organic growth from net client cash flows.

AMG demonstrated effective cost management. Total operating expenses remained virtually flat, decreasing by a negligible 0.02% to $1.25 billion for the nine months ended September 30, 2015, compared to the same period in 2014. This indicates that despite revenue growth and strategic investments, the company controlled its operational costs effectively.

AMG engaged in significant financing activities. They repurchased approximately $379.6 million of common stock. Additionally, on September 22, 2015, the company entered into a new $1.3 billion senior unsecured revolving credit facility and a $350 million senior unsecured term loan facility, which replaced previous credit facilities and provided enhanced financial flexibility.