Acadian Asset Management Inc. · NYSE:AAMI
Acadian Asset Management — BrightSphere Investment Group — Q4 2021 Earnings Presentation
33 slides from Acadian Asset Management's earnings presentation, Feb 3, 2022
Slide 1: BrightSphere Reports Financial and Operating Results for the Fourth Quarter Ended December 31, 2021
Contact: Elie Sugarman ir@bsig.com (617) 369-7300 Exhibit 99.1 BrightSphere Reports Financial and Operating Results for the Fourth Quarter Ended December 31, 2021 • U.S. GAAP earnings per share of $0.53 for the quarter, compared to $2.42 for Q4'20; Q4'20 included $1.90 per share from gain on sale of
Slide 2: Dividend Declaration
Dividend Declaration The Company’s Board of Directors approved a quarterly interim dividend of $0.01 per share payable on March 25, 2022 to shareholders of record as of the close of business on March 11, 2022. Conference Call Dial-in The Company will hold a conference call and simultaneous webcast t
Slide 3: Forward Looking Statements
Forward Looking Statements This communication includes forward-looking statements which may include, from time to time, anticipated revenues, margins, operating expense and variable compensation ratios, cash flows or earnings growth profile, anticipated performance of the Company’s business and the
Slide 4: Q4 2021 Earnings Presentation
Q4 2021 EARNINGS PRESENTATION February 3, 2022 4
Slide 5: Q4'21 Highlights
Q4'21 Highlights BrightSphere Highlights • U.S. GAAP EPS of $0.53 for Q4'21 compared to $2.42 for Q4'20; Q4'20 EPS included $1.90 per share from gain on sale of Barrow Hanley • ENI EPS of $0.53 for the quarter compared to $0.28 for Q4'20(1) • Investment performance continued to be strong with 89%, 8
Slide 6: U.S. GAAP Statement of Operations
U.S. GAAP Statement of Operations ($ in millions, unless otherwise noted) Three Months Ended Q4'21 vs. Q4'20 December 31, December 31, September 30, Increase 2021 2020(1) (Decrease) 2021 • Total revenue increased 34.9% from Management fees $ 106.5 $ 112.5 (5.3)% $ 111.4 Q4'20 primarily due to higher
Slide 7: Acadian Financial Highlights
Acadian Financial Highlights • Segment NCCF of $(0.8) billion with $0.1 million annualized revenue impact for Q4'21 compared to $(1.3) billion with annualized revenue impact of $(6.1) million for Q4'20; AUM increased 9.5% from Q4'20 as a result of strong market performance • Investment performance r
Slide 8: Acadian Platform Overview
Acadian Platform Overview Business Overview • Leading, at-scale, systematic investment manager with a track record of over 35 years and $117.2 billion in AUM as of December 31, 2021 • Quant-focused investment platform with strength across team, technology and data, offering unique capabilities in lo
Slide 9: Investment Outperformance across 1-, 3-, 5-, and 10-Year Horizons
Investment Outperformance across 1-, 3-, 5-, and 10-Year Horizons (1) Acadian Product Performance % Beating Benchmark (Revenue-Weighted) 100% 89% 90% 90% 86% 82% 80% 70% 60% 50% 40% 30% 20% 10% —% 1-Year 3-Year 5-Year 10-Year ___________________________________________________________ Please see Def
Slide 10: History of Strong AUM Growth
History of Strong AUM Growth $B Acadian's Total Ending AUM 2011 - December 31, 2021 $120.0 $117.2 $110.0 $101.9 $107.4 $100.0 $97.7 $90.0 $86.2 $80.0 $70.3 $75.0 $70.0 $66.8 $65.2 $60.0 $51.9 $50.0 $42.2 $40.0 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 10
Slide 11: Diversified Asset Base
Diversified Asset Base AUM by Client Type AUM by Client Location (in billions) Public/Government Commingled 44.9% Trust/UCIT 22.3% Europe 17.2% USA 65.8% Asia Corporate/ Australia4.7% Union AUM by Strategy 5.0% Other 13.5% Other 7.3% Sub-advisory 7.3% 12.0% Developed Markets 73.7% U.S. Equity 2.5% E
Slide 12: Investment Capabilities
Investment Capabilities Diversified Quant offerings including ESG-focused strategies Capability Attributes & Approach • Leverage numerous behavioral factors grounded in sound investment theory and psychological underpinnings; factors supported by observations from a range of disciplines, including s
Slide 13: Sector Tailwinds Expected to Support Long Term Growth
Sector Tailwinds Expected to Support Long Term Growth Secular Trends Anticipated Impact for Acadian Explosive Growth in Alpha Alternative Data Continued Development of Advanced Techniques: Brand Machine Learning, AI Scale of Investment in Data, Technology, and Flows Talent Increasingly Important Gro
Slide 14: Acadian's Recent and Ongoing Growth Initiatives
Acadian’s Recent and Ongoing Growth Initiatives Investment Theme Acadian Solutions • Systematic Macro Demand for ◦ Began offering to broad markets in late 2019; systematic macro strategies have since grown to $1.8 Diversification, billion in AUM Downside ◦ Multi-Asset Absolute Return, Commodities Ab
Slide 15: Disciplined Execution of Long-Term Growth Strategy
Disciplined Execution of Long-Term Growth Strategy Continue • Leveraging broad quant capabilities to provide exposures and solutions sought by clients Harnessing our • Highly scalable offerings with substantial capacity and global demand Unique Quant Capabilities • Multi-Asset Class capability has m
Slide 16: Key Performance Metrics
Key Performance Metrics Key Performance Metrics(1) ($ in millions, unless otherwise noted) Three Months Ended December 31, Three Months Ended September 30, Increase Increase U.S. GAAP Basis 2021 2020 (Decrease) 2021 (Decrease) Revenue $ 162.9 $ 120.8 34.9 % $ 117.9 38.2 % Pre-tax income from cont. o
Slide 17: ENI Revenue
ENI Revenue Commentary • ENI revenue includes management fees and performance fees ◦ Includes our share of earnings from our previously disposed equity-accounted Affiliate in Q4’20 and Q3’21 • Q4'21 ENI revenue of $162.9 million increased from Q4'20 by 36% driven by higher performance fees that off-
Slide 18: ENI Operating Expenses
ENI Operating Expenses Commentary • Total ENI operating expenses reflect Affiliate operating expenses and Center expenses (excluding variable compensation) • ENI Operating expenses decreased to $49.2 million in Q4'21 from $54.7 million in Q4'20 reflecting the disposition of Affiliates; Q4'21 Operati
Slide 19: ENI Variable Compensation
ENI Variable Compensation Commentary • Variable compensation is typically awarded based on contractual percentage of each Affiliate’s ENI earnings before variable compensation plus Center bonuses and also includes a contractual split of certain performance fees which is recognized over the contractu
Slide 20: Affiliate Key Employee Distributions
Affiliate Key Employee Distributions Commentary • Represents employees’ share of profit from their respective Affiliate, in some cases following an initial preference to BSIG • Q4'21 Distribution Ratio of 5.8% higher than Q4'20 mainly due to dispositions and mix of earnings • 2022 Distribution Ratio
Slide 21: Balance Sheet Management
Balance Sheet Management Balance Sheet(1) Capital ($M) December 31, 2021 December 31, 2020 Assets Cash and cash equivalents $ 252.1 $ 371.3 • December 31 net leverage ratio (third party borrowings Restricted cash — 1.6 and revolving credit facility, net of total cash and cash Investment advisory fee
Slide 22: Supplemental Information
Supplemental Information 22
Slide 23: Segment Information for Q4'21 and Q4'20
Segment Information for Q4'21 and Q4'20 Three Months Ended December 31, 2021 Three Months Ended December 31, 2020 Quant & Reconciling Total U.S. Quant & Reconciling Total U.S. ($ in millions, unless otherwise noted) Solutions Other(4) Items(1) GAAP (3) Solutions Liquid Alpha Other(4) Items(1) GAAP (
Slide 24: Segment Information for Q3'21
Segment Information for Q3'21 Three Months Ended September 30, 2021 Reconciling ($ in millions, unless otherwise noted) Quant & Solutions Other(4) Items(1) Total U.S. GAAP (3) ENI Revenue $ 110.6 $ 6.8 $ 0.5 $ 117.9 ENI Operating Expenses 39.4 7.6 10.1 57.1 Earnings before variable compensation 71.2
Slide 25: Assets Under Management Rollforward by Segment
Assets Under Management Rollforward by Segment ($ in billions, unless otherwise noted) Three Months Ended December 31, 2021 December 31, 2020 September 30, 2021 Quant and Solutions Beginning balance $ 113.7 $ 95.1 $ 117.8 Gross inflows 2.9 3.1 2.8 Gross outflows (4.4) (5.0) (4.2) Reinvested income a
Slide 26: Reconciliations and Disclosures
Reconciliations and Disclosures 26
Slide 27: Reconciliations from U.S. GAAP to Non-GAAP Measures
Reconciliations from U.S. GAAP to Non-GAAP Measures(1)(2) Three Months Ended ENI Adjustments ($ in millions) December 31, December 31, September 30, 2021 2020 2021 1i. Exclude non-cash expenses representing U.S. GAAP net income attributable to controlling interests $ 39.2 $ 198.0 $ 229.5 changes in
Slide 28: Reconciliations from U.S. GAAP to Non-GAAP Measures
Reconciliations from U.S. GAAP to Non-GAAP Measures(1) (cont.) Reconciliation of per-share U.S. GAAP Net Income to Economic Net Income per share(2) ($) Three Months Ended December 31, December 31, September 30, 2021 2020 2021 U.S. GAAP net income per share $ 0.53 $ 2.42 $ 2.76 Adjustments to reflect
Slide 29: Reconciliations from U.S. GAAP to Non-GAAP Measures
Reconciliations from U.S. GAAP to Non-GAAP Measures(1) (cont.) Reconciliation of U.S. GAAP Operating Expense to ENI Operating Expense(2) ($ in millions) Three Months Ended December 31, December 31, September 30, 2021 2020 2021 U.S. GAAP operating expense $ 114.4 $ 93.9 $ 89.2 Less: items excluded fr
Slide 30: Reconciliations from U.S. GAAP to Non-GAAP Measures
Reconciliations from U.S. GAAP to Non-GAAP Measures(1)(cont.) Reconciliation of U.S. GAAP Pre-tax Income from Continuing Operations to Pre-tax ENI(2) ($ in millions) Three Months Ended December 31, December 31, September 30, 2021 2020 2021 U.S. GAAP pre-tax income from continuing operations $ 58.5 $
Slide 31: Definitions and Additional Notes
Definitions and Additional Notes References to “BrightSphere,” “BSIG” or the “Company” refer to BrightSphere Investment Group Inc.; references to “OM plc” or “Parent” refer to Old Mutual plc, the Company’s former parent; references to “BSUS” or the “Center” refer to the holding company excluding the
Slide 32: Definitions and Additional Notes
Definitions and Additional Notes The Company adjusts its income tax expense to reflect any tax impact of its ENI adjustments. Adjusted EBITDA Adjusted EBITDA is defined as economic net income before interest, income taxes, depreciation and amortization. The Company notes that its calculation of Adju
Slide 33: Definitions and Additional Notes
Definitions and Additional Notes ENI earnings before variable compensation ENI earnings before variable compensation is calculated as ENI revenue, less ENI operating expense. ENI variable compensation ratio The ENI variable compensation ratio is calculated as variable compensation divided by ENI ear
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