Alti Global, Inc. · NASDAQ:ALTI
Alti Global — Q3 2023 Earnings Presentation
41 slides from Alti Global's earnings presentation, Nov 14, 2023
Slide 1: Third Quarter 2023 Earnings
Third Quarter 2023 Earnings | November 2023 AlTi Global 1
Slide 2: Disclosures
Disclosures This Presentation (together with oral statements made in connection herewith, the “Presentation”) is for informational purposes only to assist interested parties in evaluating AlTi Global, Inc. (along with its consolidated subsidiaries, “AlTi Global” or the "Company"). About AlTi Global
Slide 3: Disclosures (Cont.)
Disclosures (Cont.) Financial Information The financial information and data contained in this Presentation is unaudited and does not conform to Regulation S-X promulgated under the Securities Act. Accordingly, such information and data may not be included in, may be adjusted in or may be presented
Slide 4: AlTi at a Glance
AlTi at a Glance Delivering transformational ideas that create enduring value $68 B Assets Under Advisement 490+ Professionals with diverse $4 B Committed to Impact 20+ Year operating history $2 B Invested alongside clients (AUM/AUA) experience & expertise strategies Global footprint with presence i
Slide 5: AlTi's One Platform Approach
AlTi’s One Platform Approach Serving complementary and attractive business lines Wealth Asset Material consumers of financial services beyond Existing scale, reputation and critical mass Management Management investment products (e.g., insurance, annuities) Strong investor demand, particularly for S
Slide 6: Investment Highlights
Investment Highlights Uniquely positioned between global family office solutions and alternative asset management Strong businesses Large and growing addressable market Established reputation in the market Both in asset and wealth management Global footprint Recurring and diversified revenue Strateg
Slide 7: Expanding Market Opportunities
Expanding Market Opportunities Powered by multi-decadal trajectories Large, Expanding Market Generational Wealth Transfer Shifting To Independence Growth of Global Wealth (2021-2026P) U.S. Wealth Transfer (2018-2042P) U.S. Independent Advisor AUM/AUA (2014-2024P) (1) ($ in Trillions) ($ in Trillions
Slide 8: Global, Growing Client Base
Global, Growing Client Base Serving evolving client priorities Global Demand for Alternatives Across Generations With Impact Priority Alternative AUM/AUA Growth and Forecast (2011-2026P) Alt. Asset Exposure by Demographic (2021-2024P) Relevance of ESG Factors ($ in Trillions) Private equity Private
Slide 9: 2023 Strategic Priorities
2023 Strategic Priorities Leverage Competitive Achieve Organizational Execute Accretive Streamline Capital Advantages to Accelerate Efficiencies and Right Size Acquisitions to Generate Structure Organic Growth Cost Structure Topline Momentum Achieving top line growth and at least $16M in annualized
Slide 10: AlTi Wealth Management – Highlights
AlTi Wealth Management – Highlights Resilient and expanding global client base $49 Scale $49B AUM/AUA, $ in Billions AUM/AUA $43 $41 $36 Global presence 8 $32 Countries with AlTi WM offices High client retention 97% Client retention since 2019 Long-tenured clients ~10 Years average client tenure 201
Slide 11: Wealth Management – Holistic Solutions
Wealth Management – Holistic Solutions Combining the services of a family office with the depth of a world-class, global institution Investment Advisory & Impact Estate & Wealth Planning Customized risk-adjusted portfolios Implementation and management Bespoke AlTi Team Expertise curated from Trust
Slide 12: AlTi Asset Management – Highlights
AlTi Asset Management – Highlights Differentiated provider of public and private market solutions serving growing alternatives market AUM/AUA, $ in Billions $22 $20 $20 Scale $20B $17 AUM/AUA $15 Alignment with clients $1.1B Invested alongside clients Experienced team 40+ years of operating history
Slide 13: Asset Management – Platform Breakdown
Asset Management – Platform Breakdown Global network of capabilities built on an end-to-end support platform 1980 2009 2017 Alternatives Platform Real Estate – Private Markets Real Estate – Public Markets Four fund strategies Direct investments – ~50 equity and debt UK REIT transactions realized sin
Slide 14: Asset Management: Strong performance and uncorrelated returns
Asset Management Strong performance and uncorrelated returns (1) Event-driven European Long Short Equities Event- MSCI HFRI European MSCI HFRI driven L/S Equities Annualized 6.7% 7.0% 4.0% Annualized 12.4% 4.7% 4.3% European L/S MSCI +120% Performance Performance Equities +92% Event driven Volatilit
Slide 15: Asset Management: Public Real Estate
Asset Management: Public Real Estate Long-term outperformance through varied market cycles o UK main market listed REIT o Market Cap: £1.6B/U.S.$1.9B Performance of LXi REIT LXI +25% FTSE 250 +17% 2/27/17 6/27/17 10/27/17 2/27/18 6/27/18 10/27/18 2/27/19 6/27/19 10/27/19 2/27/20 6/27/20 10/27/20 2/2
Slide 16: M&A Will Continue to be a Key Driver of Growth
M&A Will Continue to be a Key Driver of Growth Compelling universe of opportunities Transacted AUM/AUA by Asset Class and Share Alternative Asset Management Industry ($ in Billions) $1,800 $1,600 $1,400 $515 $636 $1,200 OPPORTUNITY SET 2,000+ funds have $1,000 AUM/AUA of $500M to $5B Seeding & Large
Slide 17: Demonstrated Track Record
Demonstrated Track Record Strategic acquisition and integration of asset managers & wealth managers Select AlTi M&A Examples Wealth Management Asset Management Illustrative Acquisition Criteria Illustrative Acquisition Criteria • Expand global footprint • Diversify management fee • Uncorrelated to e
Slide 18: M&A in 2023
M&A in 2023 Closed accretive acquisitions with selected global specialists Wealth Management Completed the acquisition of two multi-family offices AL Wealth Partners Lugano • Singapore-based UHNW manager with ~$1B AUM • Lugano-based MFO with $1.2B AUM • Acquired 100% of the company in April 2023 • A
Slide 19: Financial Highlights
Financial Highlights AlTi Global 19
Slide 20: Third Quarter 2023 Overview
Third Quarter 2023 Overview Q3 2023 YTD 2023 • Revenues $159.2 million • Revenues $49.2 million • 87% of total revenues are recurring • 97% of total revenues are recurring Financial(1) • GAAP Net Income ($231.9) million, Adjusted Net Income • GAAP Net Income ($171.1) million, Adjusted Net ($2.5) mil
Slide 21: Select Financial and Operating Metrics
Third Quarter 2023 Select Financial and Operating Metrics ($ in Millions) 3Q’23 2Q’23(3) QoQ • Revenue of $49.2M declined 5% QoQ. On a normalized basis(2) revenues were flat. Revenue $49.2 $51.9 -5% 97% of total revenues was from recurring fees. Mgmt./Advisory Fees 45.1 47.4 -5% Incentive Fees 0.9 0
Slide 22: Segment Highlights
Segment Highlights AlTi Global 22
Slide 23: Wealth Management
Wealth Management Select Financial and Operating Metrics ($ in Millions) 3Q’23 2Q’23 QoQ % • Revenue of $34.5M increased 2% sequentially, reflecting the acquisition of a Lugano-based multi- $34.5 $33.9 2% family office and net client wins, partly offset by market performance. 100% of revenues are fr
Slide 24: Wealth Management Operating Metrics – AUM/AUA
Wealth Management Operating Metrics – AUM/AUA Wealth Management Assets Under Management (AUM) AUM: $32.9 billion ($ in Millions) 3Q’23 2Q'23 AUA: $48.5 billion Beginning Balance: $32,776 $30,408 New Clients, net 41 430 Assets Under Advisement (AUA) Cash Flow, net (16) (209) ($ in Millions) 3Q’23 2Q'
Slide 25: Asset Management
Asset Management Select Financial and Operating Metrics • Revenue of $14.7M decreased $3.2M (18%) primarily driven by lower transaction fees and ($ in Millions) 3Q’23 2Q’23(2) QoQ lower average asset levels in the quarter which resulted in lower management fees. 90% of Revenue $14.7 $17.9 -18% reven
Slide 26: Asset Management Operating Metrics – AUM/AUA
Asset Management Operating Metrics – AUM/AUA Real Estate - Public & Private Funds Asset Management ($ in Millions) 3Q’23 $12,355 AUM: $4.7 billion Beginning Balance: Change (377) AUA: $19.7 billion AUM/AUA at September 30, 2023(1) $11,978 Average AUM/AUA $12,167 Alternatives Platform Gross New Septe
Slide 27: Asset Management Operating Metrics – Fund Performance
Asset Management Operating Metrics – Fund Performance Alternatives Platform Fund Performance(1) ($ in Millions) 3Q’23 2Q’23 1Q’23 Event-driven 4.95% (0.35%) 0.25% External Strategic Managers: Real Estate Bridge Lending 1.24% 0.75% 0.67% European Long Short Equities 0.07% (1.60%) 2.31% Asian Credit a
Slide 28: Our Long-Range Goals
Our Long-Range Goals Reflect continued execution of proven business model • Annual AUM/AUA growth rate (1) High single-digit percentage • Annual Revenue growth rate (1) Low-teens percentage • Adjusted EBITDA margin Expansion to mid 30s (2) (1) Growth rate represents long-term annual growth, on avera
Slide 29: Appendix
Appendix AlTi Global 29
Slide 30: Third Quarter 2023 GAAP Results (Unaudited)
Third Quarter 2023 GAAP Results (Unaudited) ($ in Thousands, except share data) 3Q'23 2Q’23(1) Revenue Management/advisory fees $ 45,062 $ 47,440 Incentive fees 885 469 Distributions from investments 2,596 2,203 Other income/fees 701 1,769 Total income 49,244 51,881 Operating Expenses Compensation a
Slide 31: YTD 2023 GAAP Results (Unaudited)
YTD 2023 GAAP Results (Unaudited) ($ in Thousands, except share data) YTD 3Q’23 Revenue Management/advisory fees $ 138,972 Incentive fees 1,931 Distributions from investments 14,829 Other income/fees 3,440 Total income 159,172 Operating Expenses Compensation and employee benefits 134,393 Systems, te
Slide 32: Consolidated Balance Sheet (Unaudited)
Consolidated Balance Sheet (Unaudited) ($ in Thousands, except share data) As of September 30, 2023 Assets Cash and cash equivalents 12,196 Fees receivable, net 32,098 Investments at fair value 164,660 Equity method investments 27,927 Intangible assets, net of accumulated amortization 501,190 Goodwi
Slide 33: Non-GAAP Reconciliation Q3 2023
Non-GAAP Reconciliation Q3 2023 3Q’23 ($ in Thousands) Asset Management Segment Wealth Management Segment Total AlTi Net income (loss) before taxes $ (167,650) $ (5,206) $ (172,856) Stock based compensation (1) 1,101 5,472 6,573 Transaction expenses (2) 3,876 3,768 7,644 Changes in fair value of inv
Slide 34: Non-GAAP Reconciliation Q2 2023
Non-GAAP Reconciliation Q2 2023 2Q'23 ($ in Thousands) Asset Management Segment Wealth Management Segment Total AlTi Net income (loss) before taxes $ (13,151) $ 27,151 $ 14,000 Stock based compensation (1) 510 2,414 2,924 Transaction expenses (2) 4,918 6,962 11,880 Change in fair value of warrant li
Slide 35: Non-GAAP Reconciliation YTD Q3 2023
Non-GAAP Reconciliation YTD Q3 2023 YTD 3Q’23 ($ in Thousands) Asset Management Segment Wealth Management Segment Total AlTi Net income (loss) before taxes $ (219,340) $ (25,156) $ (244,496) Stock based compensation (1) 1,809 13,526 15,335 Stock based compensation - Legacy (2) 13,148 11,549 24,697 T
Slide 36: Expected Financial Drivers
Expected Financial Drivers Well-defined path with a clear trajectory for long term growth 01. Topline Growth Stable recurring revenue foundation across both asset and wealth management Topline growth fueled by new partnerships Revenue diversification through emerging strategies and solutions Cost-sa
Slide 37: Clear Value Creation Roadmap
Clear Value Creation Roadmap AlTi ecosystem presents significant growth opportunities • Expand into complementary domestic and international markets • Provide clients in three continents with a localized offering while addressing their New investment strategies & global presence multi-jurisdictional
Slide 38: Our Commitment to Impact
Our Commitment to Impact Sustainable practices across corporate activities Our goal is generating sustainable financial returns with net positive impact. Our strategy and efforts are led by Chief Impact Officer, Jed Emerson. Culture at Core – Diversity, Equity & Inclusion is a matter of principle fo
Slide 39: Glossary
Glossary Assets Under Management and Assets Under Advisement. For financial presentation purposes, total assets under management and assets under advisement (“AUM/AUA”) of AlTi Global is calculated as set forth below: AUM/AUA includes billable and non-billable assets. Billable assets represent the p
Slide 40: Footnotes
Footnotes Past performance does not guarantee or indicate future results. The historical net performance presented above are provided from inception of each fund through September 30, 2023 and are unaudited. The returns for the Event driven strategy reflect the deduction of the actual management fee
Slide 41: Thank You
Thank You AlTi Global 41