Artisan Partners Asset Management Inc. · NYSE:APAM
Artisan Partners Asset Management — Q1 2016 Earnings Presentation
22 slides from Artisan Partners Asset Management's earnings presentation, Apr 25, 2016
Slide 1: Business Update and First Quarter 2016 Earnings Presentation
a r t i s a n p a r t n e r s a s s e t m a n a g e m e n t 0 B U S I N E S S U P D A T E A N D F I R S T Q U A R T E R 2 0 1 6 E A R N I N G S P R E S E N T A T I O N Artisan Partners Asset Management
Slide 2: Business Update & Quarterly Results Discussion
a r t i s a n p a r t n e r s a s s e t m a n a g e m e n t 1 BUSINESS UPDATE & QUARTERLY RESULTS DISCUSSION Eric R. Colson is Chairman and Chief Executive Officer of Artisan Partners. Prior to joining the firm in January 2005, Mr. Colson was an executive vice president of Callan Associates, Inc. wh
Slide 3: Business Philosophy & Approach
a r t i s a n p a r t n e r s a s s e t m a n a g e m e n t 2 BUSINESS PHILOSOPHY & APPROACH Thoughtful Growth Active Strategies Autonomous Franchises Proven Results Designed for Investment Talent to Thrive Managed by Business Professionals Structured to Align Interests Active Talent Identification
Slide 4: High Value Added — Evolution
a r t i s a n p a r t n e r s a s s e t m a n a g e m e n t 3 Index Focused HIGH VALUE ADDED — Evolution Evolving High Value Added Narrower Investable Universe Risk Aware Longer-Term Investment Horizon Outcome Focused Broader Investable Universe Risk Management Short-Term Risk Focused
Slide 5: High Value Added — Investment Teams
a r t i s a n p a r t n e r s a s s e t m a n a g e m e n t 4 16% 11% 23% 9% 23% 12%12% 24% 5% Global Opportunities Global Equity Global Value 3/31/2010 3/31/2013 3/31/2016 15% 14% 11% 17% 0% 9% 3% 13% Global Opportunities Global Equity Global Value 3/31/2010 3/31/2013 3/31/2016 78% 35% 48% 57% 36%
Slide 6: High Value Added — Long-Term Investment Results
a r t i s a n p a r t n e r s a s s e t m a n a g e m e n t 5 Data as of and through March 31, 2016. Value added measures the average annual outperformance or underperformance of the gross composite return of each Artisan Partners strategy compared to its broad-based benchmark. Periods of one year o
Slide 7: High Value Added — Diversity
a r t i s a n p a r t n e r s a s s e t m a n a g e m e n t 6 HIGH VALUE ADDED — Diversity Data shown is from April 1, 2006 -March 31, 2016. Represents, at each time shown, the trailing 3-year average annual returns of the gross composite of each Artisan Partners strategy compared to the trailing 3-
Slide 8: High Value Added — Outperformance
a r t i s a n p a r t n e r s a s s e t m a n a g e m e n t 7 8% 10% 7% 15% 17% 33% 39% 44% 47% 55% 58% 52% 49% 38% 28% 1-Year 3-Year 5-Year 10-Year 15-Year >500 bps >100-500 bps 0-100 bps 66% 75% 77% 89% 94% 1-Year 3-Year 5-Year 10-Year 15-Year HIGH VALUE ADDED — Outperformance Outperformance Perce
Slide 9: High Value Added — Balanced Distribution
a r t i s a n p a r t n e r s a s s e t m a n a g e m e n t 8 Institutional 65% Intermediary 30% Retail 5% AUM by VehicleAUM by Client Domicile AUM by Distribution Channel1AUM by Investment Team U.S. 85% Non-U.S. 15% Artisan Funds 52% Separate Accounts 46% UCITS 2% Global Equity 31% Global Value 32%
Slide 10: Assets Under Management & Net Client Cash Flows
a r t i s a n p a r t n e r s a s s e t m a n a g e m e n t 9 ASSETS UNDER MANAGEMENT & NET CLIENT CASH FLOWS (in billions) Net Client Cash Flows $108.7 $109.2 $97.0 $99.8 $97.0 $108.4 $111.4 $104.7 $101.4 $92.9 1Q15 2Q15 3Q15 4Q15 1Q16 Assets Under Management Assets Under Management Average Assets
Slide 11: Financial Results — Financial Highlights
a r t i s a n p a r t n e r s a s s e t m a n a g e m e n t 10 FINANCIAL RESULTS — Financial Highlights $108.4 $101.4 $92.9 1Q15 4Q15 1Q16 -8% -14% $203.6 $192.0 $174.5 1Q15 4Q15 1Q16 -9% -14% $125.4 $115.8 $111.9 1Q15 4Q15 1Q16 -3% -11% $98.4 $88.9 $87.5 1Q15 4Q15 1Q16 -2% -11% Compensation & Benef
Slide 12: Compensation Expense Commentary
a r t i s a n p a r t n e r s a s s e t m a n a g e m e n t 11 Incentive Compensation is primarily variable compensation paid to investment and distribution teams based on revenue- share percentages and discretionary cash incentives paid to other employees. Incentive Compensation decreased in the
Slide 13: Financial Results — Financial Highlights
a r t i s a n p a r t n e r s a s s e t m a n a g e m e n t 12 FINANCIAL RESULTS — Financial Highlights Adjusted Operating Margin1 Adjusted Net Income (in millions) & Adjusted Net Income per Share1 1Q15 4Q15 1Q16 1 Operating Margin (GAAP) for the quarters ended March, 31, 2015, December 31, 2015, an
Slide 14: Financial Results — Dividends
a r t i s a n p a r t n e r s a s s e t m a n a g e m e n t 13 FINANCIAL RESULTS — Dividends Note: Time periods noted above represent the period in which the dividends were paid. This slide does not include special annual dividends paid in 2014, 2015, or 1Q16. $0.43 $0.55 $0.60 $0.60 $0.60 2013 2014
Slide 15: Financial Results — Capital Management
a r t i s a n p a r t n e r s a s s e t m a n a g e m e n t 14 FINANCIAL RESULTS — Capital Management ¹ Calculated in accordance with debt agreements. $166.2 $217.9 4Q15 1Q16 Cash (in millions) $200.0 $200.0 4Q15 1Q16 Borrowings (in millions) $116.6 $120.6 4Q15 1Q16 Equity (in millions) 0.5x 0.6x 4Q
Slide 16: Appendix
APPENDIX
Slide 17: Reconciliation of GAAP to Non-GAAP (Adjusted) Measures
a r t i s a n p a r t n e r s a s s e t m a n a g e m e n t 16 RECONCILIATION OF GAAP TO NON-GAAP (“ADJUSTED”) MEASURES (in millions) March 31 December 31 March 31 2016 2015 2015 Net income attributable to Artisan Partners Asset Management Inc. (GAAP) 16.3 20.1 19.5 Add back: Net income attributable
Slide 18: Long-Term Investment Results
a r t i s a n p a r t n e r s a s s e t m a n a g e m e n t 17 LONG-TERM INVESTMENT RESULTS Source: Artisan Partners/MSCI/Russell/BofA Merrill Lynch. Average Annual Total Returns (Gross) represents gross of fees performance for the Artisan Composites. Value add measures the average annual outperform
Slide 19: Percentage of AUM in Outperforming Strategies and Fund Rankings
a r t i s a n p a r t n e r s a s s e t m a n a g e m e n t 18 Sources: Artisan Partners/Lipper Inc/Morningstar. % of AUM in Outperforming Strategies at December 31 of each year, unless noted otherwise. % of AUM in Outperforming Strategies represents the % of AUM in strategies where gross of fees co
Slide 20: Global Distribution
a r t i s a n p a r t n e r s a s s e t m a n a g e m e n t 19 GLOBAL DISTRIBUTION (in billions) U.S. vs. Non-U.S. Client Net Flows 13% 13% 14% 14% 15% $13.8 $14.2 $13.1 $14.2 $14.3 1Q15 2Q15 3Q15 4Q15 1Q16 Non-U.S. Client AUM Non-U.S. Client AUM as a % of Firmwide AUM Non-U.S. Client AUM (2.0) (0.5
Slide 21: Notes & Disclosures — Forward-Looking Statements
a r t i s a n p a r t n e r s a s s e t m a n a g e m e n t 20 NOTES & DISCLOSURES Forward-Looking Statements Certain statements in this presentation, and other written or oral statements made by or on behalf of the Company, are “forward-looking statements” within the meaning of the federal securiti
Slide 22: Notes & Disclosures
a r t i s a n p a r t n e r s a s s e t m a n a g e m e n t 21 NOTES & DISCLOSURES Ratings are based on risk-adjusted returns and are historical and do not represent future results. The Overall Morningstar RatingTM for a fund is derived from a weighted average of the performance figures associated w
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