01—Abstract
Summary
Summary of the 10-Q filed August 2, 2024. Cited figures are marked; the original filing is the authoritative source.
Affiliated Managers Group, Inc. (AMG) reported its financial results for the three and six months ended June 30, 2024.
For the three months, net income attributable to controlling interest decreased by 39% to $76.0 million compared to $125.3 milliona in the prior year. For the six months, net income attributable to controlling interest decreased by 13% to $225.8 million compared to $259.8 million in the prior year. This decrease was primarily driven by lower equity method income, increased income tax expenses, and a decrease in investment and other income, partially offset by higher equity method earnings in the six-month period.
Despite the decline in net income, total assets under management (AUM) increased to $701.0 billionb as of June 30, 2024, up from $673.9 billion at the start of the period. This growth was fueled by strong inflows into alternative strategies, particularly private markets and liquid alternatives, which offset outflows in equity strategies. The company also repurchased a significant amount of its own stock during the period, demonstrating a commitment to returning capital to shareholders.
02—Key points
Key Highlights
- Net income attributable to controlling interest declined significantly year-over-year for both the three-month and six-month periods.
- Total Assets Under Management (AUM) grew to $701.0 billion as of June 30, 2024, indicating continued investor demand for AMG's strategies.
- The company experienced strong client inflows in alternative strategies, particularly private markets and liquid alternatives.
- Consolidated revenue decreased slightly for both the three-month and six-month periods.
- Significant share repurchases were executed during the period, totaling 2.1 million shares in the second quarter.
- Interest expense increased due to the issuance of new junior subordinated notes.
- A notable impairment charge of $39.9 million was recognized in the equity method income for the six-month period.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-QQ2 FY2024filed August 2, 2024Financial Statements
Q2 FY2024 against Q2 FY2023
| Line item | Q2 FY2024Q2 FY2023 | Change |
|---|---|---|
| Revenue | $500.30M$512.50M | −2.4% |
| SG&A Expenses | $89.40M$85.20M | +4.9% |
| Operating Expenses | $359.40M$374.60M | −4.1% |
| Net Income | $76.00M$125.30M | −39.3% |
| EPS (Basic) | $2.42$3.49 | −30.7% |
| EPS (Diluted) | $2.26$3.25 | −30.5% |
| Shares Outstanding (Basic) | 31.50M35.90M | −12.3% |
| Shares Outstanding (Diluted) | 35.30M42.10M | −16.2% |
05—Questions
Frequently Asked Questions
What was the primary driver for the decrease in net income attributable to controlling interest?
The decrease in net income attributable to controlling interest was primarily driven by a significant decrease in equity method income (net) and an increase in income tax expense for the three-month period. For the six-month period, the decrease was due to a decline in investment and other income and an increase in income tax expense, partially offset by an increase in equity method income (net).
How did Assets Under Management (AUM) perform during the quarter?
Total AUM increased to $701.0 billion as of June 30, 2024, up from $699.4 billion at the end of the previous quarter. This growth was supported by positive net client cash flows in alternative strategies like private markets and liquid alternatives, despite outflows in equity strategies.
What is the company's strategy regarding capital return to shareholders?
AMG actively returns capital to shareholders through share repurchases. During the three and six months ended June 30, 2024, the company repurchased 2.1 million and 3.0 million shares, respectively, demonstrating a commitment to shareholder value.
Were there any significant one-time charges or impairments recorded?
Yes, for the six months ended June 30, 2024, the company recorded an equity method intangible impairment of $39.9 million, related to a decline in the fair value of an affiliate investment due to anticipated decreases in assets under management.
06—Continue