Artisan Partners Asset Management Inc. · NYSE:APAM

Artisan Partners Asset Management — Q2 2014 Earnings Presentation

27 slides from Artisan Partners Asset Management's earnings presentation, Jul 21, 2014

  1. Slide 1: Business Update and Second Quarter 2014 Earnings Presentation

    ARTISAN PARTNERS ASSET MANAGEMENT B U S I N E S S U P D A T E A N D S E C O N D Q U A R T E R 2 0 1 4 E A R N I N G S P R E S E N T A T I O N Artisan Partners Asset Management

  2. 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 President 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. wher

  3. Slide 3: Firm Facts

    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 FIRM FACTS ? Founded in 1994; focused on providing high value-added investment strategies ? Six autonomous investment teams managing fourteen investment strategies for sophisticated, institutional investors ? Principal offices in Milwaukee,

  4. Slide 4: Market Perspectives

    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 0.00% 1.00% 2.00% 3.00% 4.00% 5.00% 6.00% 7.00% 8.00% 9.00% 0 250 500 750 1,000 1,250 1,500 1,750 2,000 2,250 1 0 - Y e a r U S T r e a s u r y Y i e l d S & P 5 0 0 C l o s i n g P r i c e S&P 500 vs 10-Year US Treasury Yield S&P 500 10-

  5. Slide 5: 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 4 Global Equity Team Non-U.S. Growth Strategy 1/1/96 29.1$ Non-U.S. Small-Cap Growth Strategy 1/1/02 1.7$ Global Equity Strategy 4/1/10 0.3$ Global Small-Cap Growth Strategy 7/1/13 0.2$ U.S. Value Team U.S. Mid-Cap Value Strategy 4/1/99 15.

  6. Slide 6: Investment Performance — Outperformance and 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 5 INVESTMENT PERFORMANCE — Outperformance and Rankings Sources: Artisan Partners/Lipper Inc/Morningstar. % of AUM in Outperforming Strategies at December 31 of each year except as indicated. % of AUM in Outperforming Strategies represents t

  7. Slide 7: Business Discipline — Firm Asset Diversification

    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 Artisan Funds 56% Separate Accounts 42% UCITS 2% U.S. 88% Non-U.S. 12% BUSINESS DISCIPLINE — Firm Asset Diversification Channel Diversification1 Team Diversification Global Equity 28% Global Value 30% U.S. Value 19% Growth 21% Emerging Ma

  8. Slide 8: 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 7 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 E

  9. Slide 9: Business Strategy

    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 Talent Focus BUSINESS STRATEGY Management Guideposts Strong Long-Term Investment Results Asset Diversification Financial Discipline Alignment Growth Stability Autonomy Global Equity U.S. Value Growth Global Value Emerging Markets Credit

  10. Slide 10: Talent Focus — Autonomy

    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 TALENT FOCUS — Autonomy Time Creativity Culture Discipline Autonomy Global Equity U.S. Value Growth Global Value Emerging Markets Credit

  11. Slide 11: Talent Focus — Alignment

    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 TALENT FOCUS — Alignment Philosophy Equity Ownership Compensation Time Horizon Autonomy Alignment Time Creativity Culture Discipline Global Equity U.S. Value Growth Global Value Emerging Markets Credit

  12. Slide 12: Talent Focus — Growth

    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 TALENT FOCUS — Growth Thoughtful Alpha-Focused Talent-Driven Balanced Autonomy Alignment Growth Philosophy Equity Ownership Compensation Time Horizon Time Creativity Culture Discipline Global Equity U.S. Value Growth Global Value Emergin

  13. Slide 13: Talent Focus — Stability

    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 TALENT FOCUS — Stability Structure Careers Clients Operations Autonomy Alignment Growth Stability Thoughtful Alpha-Focused Talent-Driven Balanced Philosophy Equity Ownership Compensation Time Horizon Time Creativity Culture Discipline Gl

  14. Slide 14: Talent Focus — Synergy

    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 TALENT FOCUS — Synergy Autonomy Alignment Growth Synergy Stability Global Equity U.S. Value Growth Global Value Emerging Markets Credit

  15. Slide 15: Equity Grants

    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 EQUITY GRANTS Equity Grant Philosophy ? Long-term interest alignment ? Talent acquisition and retention ? Merit-based award driven by consistent value creation ? Equity as a percentage of an employee’s total compensation highly variable

  16. Slide 16: Summary of June Quarter 2014 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 15 ? AUM increased 4% to $112.0 billion ? Average AUM increased 2% to $108.2 billion ? Net flows of $558 million resulted in 2.1% annualized organic growth ? Revenues increased 3% to $208.5 million ? Operating margin of 38.8% ? Net income pe

  17. Slide 17: 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 16 ASSETS UNDER MANAGEMENT & NET CLIENT CASH FLOWS (in billions) $85.8 $96.9 $105.5 $107.4 $112.0 $85.3 $92.4 $101.0 $106.2 $108.2 2Q13 3Q13 4Q13 1Q14 2Q14 Assets Under Management Ending Assets Under Management Average Assets Under Manageme

  18. Slide 18: 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 17 GLOBAL DISTRIBUTION (in billions) $9.8 $10.9 $11.9 $11.9 $13.5 11% 11% 11% 11% 12% 2Q13 3Q13 4Q13 1Q14 2Q14 Non-U.S. Client AUM Non-U.S. Cl ient AUM as a % of Fi rmwide AUM Non-U.S. Cl ient AUM $2.6 $1.0$1.0 $1.0 YTD 2013 YTD 2014 Year T

  19. Slide 19: 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 18 FINANCIAL RESULTS — Financial Highlights Average Total AUM (in billions) Revenues (in millions) $85.3 $106.2 $108.2 2Q13 1Q14 2Q14 $82.3 $107.2 YTD 2Q13 YTD 2Q14 $162.0 $201.8 $208.5 2Q13 1Q14 2Q14 $310.2 $410.3 YTD 2Q13 YTD 2Q14 Quarter

  20. Slide 20: 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 19 FINANCIAL RESULTS — Financial Highlights Adjusted Operating Margin1 Adjusted Net Income (in millions) & Adjusted Net Income per Share1 Adjusted Net Income per Adjusted Share Adjusted Net Income 2Q13 1Q14 2Q14 1 Operating Margin (GAAP) fo

  21. Slide 21: Financial Results — Compensation & Benefits

    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  Salary & Incentives includes incentive compensation, which increased in the June 2014 quarter as compared to the March 2014 and June 2013 quarters due primarily to higher revenues.  Benefits & Payroll taxes decreased in the June 2014

  22. Slide 22: 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 21 FINANCIAL RESULTS — Capital Management ¹ Calculated in accordance with debt agreements. $211.8 $203.6 4Q13 2Q14 Cash (in millions) $200.0 $200.0 4Q13 2Q14 Borrowings (in millions) 0.7x 0.5x 4Q13 2Q14 Leverage Ratio1 $132.3 $124.3 4Q13 2Q

  23. Slide 23: Appendix

    APPENDIX

  24. Slide 24: 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 23 RECONCILIATION OF GAAP TO NON-GAAP (“ADJUSTED”) MEASURES (in millions) June 30 March 31 June 30 June 30 June 30 2014 2014 2013 2014 2013 Net income attributable to Artisan Partners Asset Management Inc. (GAAP) 19.3 8.6 5.7 27.9 8.7 Add b

  25. Slide 25: 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 24 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

  26. Slide 26: 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 25 NOTES & DISCLOSURES Forward-Looking Statements Certain information in this presentation, and other written or oral statements made by or on behalf of Artisan Partners, are “forward-looking statements” within the meaning of the federal se

  27. Slide 27: 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 26 NOTES & DISCLOSURES We also present information based on Lipper rankings for series of Artisan Funds. Lipper rankings are based on total return, are historical and do not represent future results. The number of funds in a category may in

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