Alliancebernstein Holding L.p. · NYSE:AB
Alliancebernstein Holding L.p — Q4 2024 Earnings Presentation
34 slides from Alliancebernstein Holding L.p's earnings presentation, Feb 6, 2025
Slide 1: Fourth Quarter 2024 Review
Fourth Quarter 2024 Review February 6, 2025 Seth P. Bernstein, President & Chief Executive Officer Jackie Marks, Chief Financial Officer
Slide 2: Cautions Regarding Forward-Looking Statements
Cautions Regarding Forward-Looking Statements Certain statements provided by management in this presentation are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks, uncertainties and other fact
Slide 3: AB's Unique Value Proposition
AB’s Unique Value Proposition Integrated asset and wealth manager with differentiated capabilities, partnerships and structure Differentiated Distribution Platform, with Proprietary-Plus Private Wealth Channel 1 Advantageous competitive positions in growing markets: APAC, US HNW, Global Insurance Di
Slide 4: Key Business Highlights Fourth Quarter and Full Year 2024
Key Business Highlights Fourth Quarter and Full Year 2024 Transformative Initiatives, Enhancing Margin Profile and Prioritizing Resource Allocation 1 • Closing of Bernstein JV and NYC relocation contributed to 410bps margin expansion and debt repayment in FY24 • 4Q24 adj. operating margin of 36.4%,
Slide 5: Key Financial Highlights Fourth Quarter & Full Year 2024
Key Financial Highlights Fourth Quarter & Full Year 2024 4Q24 4Q23 FY24 FY23 AUM and Flows End of Period (“EOP”) AUM $792.2 $725.2 $792.2 $725.2 (USD Billions, Except Average AUM $801.0 $685.4 $768.5 $680.3 Fee Rate) Equitable ("EQH") AUM, EOP $131.5 $119.5 $131.5 $119.5 Private Markets AUM, EOP $69
Slide 6: Percentage of Assets Outperforming at Quarter-End
Percentage of Assets Outperforming at Quarter-End Fixed Income One-Year Three-Year Five-Year 91 89 92 75 73 71 77 70 68 65 61 57 60 59 57 4Q:23 1Q:24 2Q:24 3Q:24 4Q:24 4Q:23 1Q:24 2Q:24 3Q:24 4Q:24 4Q:23 1Q:24 2Q:24 3Q:24 4Q:24 Equities One-Year Three-Year Five-Year 68 63 65 63 64 67 65 54 55 55 45
Slide 7: Retail Highlights
Retail Highlights Retail Sales Match FY21 Record, Highest Inflows Since FY21 Driving Steady Growth in Adjusted Management Fees USD billions USD millions Gross Sales Gross Redemptions Net Flows Base Fees Performance Fees $26.6 $26.4 $23.8 $23.2 $21.0 $1 $0 $14 $4.2 $2.8 $5.4 $3 $1.3 $1.1 $0 $365 $376
Slide 8: Institutional Highlights
Institutional Highlights Active Equity Redemptions, Alts Distributions & Rates Vol Pipeline Reflects Strong Fundings, Coupled with Alts Wins USD Billions Gross Sales Gross Redemptions Net Flows $ Billions Pipeline AUM (EoP) Fee Rate (Bps) 56bps Incl. Private Placements $14 56bps 60 $4.2 $3.3 $3.3 49
Slide 9: Private Wealth Highlights
Private Wealth Highlights Record Annual Sales Drive Fourth Straight Year of Inflows Diversified Revenue Streams, Uncaptured in Base Fee Rate USD Billions USD millions Gross Sales Gross Redemptions Net Flows Base Fees Performance Fees Net Interest Margin $5.5 $5.4 $5.2 $4.3 $4.7 $17 $77 $0.5 $15 $0.1
Slide 10: Progress Towards Our Private Markets AUM of $90–$100 Billion by 2027
Progress Towards Our Private Markets AUM of $90–$100 Billion by 2027 AB Private Markets AUM (2014–2027E) Positioned to grow 9%–13% CAGR, to $90–$100 billion in USD billion Private Markets AUM by 2027, and derive >20% of our asset management revenues $10 billion • Well-established track records in co
Slide 11: Select Adjusted Financials and Ratios
Select Adjusted Financials and Ratios Revenues 4Q24 4Q23 Percent ∆ 2024 2023 Percent ∆ Base Fees* $798 $682 17% $3,049 $2,717 12% Performance Fees: Private Markets† 67 41 66% 136 101 35% Public Markets 66 10 n.m. 91 25 n.m. Bernstein Research Services — 100 n.m. 96 386 (75)% Investment Gains 6 2 n.m
Slide 12: Base Fee Rate Has Stabilized Year-to-Date
Base Fee Rate Has Stabilized Year-to-Date Firmwide Base Fee Rate—Last Three Years Basis points Supportive 42 • Alts deployments • Rotation from MMKTs to FI 41 • Organic and AUM growth in Equity MFs, Offshore FI 39.9bps • Organic and AUM growth in 40 39.8bps Private Wealth, Offshore 39.6bps Retail, I
Slide 13: Large Portion of Recurring Performance-Related Fees, Driven by Privates
Large Portion of Recurring Performance-Related Fees, Driven by Privates Annual Performance Fees—Private and Public Markets USD Millions • Strong public markets and performance, resulted in $66mln of ~2X $227 performance fees from our Public Alternative strategies in 4Q, driving meaningful upside fro
Slide 14: Assuming Neutral Markets, Launching Point for FY25 Margins is 33%
Assuming Neutral Markets, Launching Point for FY25 Margins is 33% Adjusted Operating Margin Path and FY25 Outlook Cumulative YTD margin expansion 33% +410bps 32.3% 1 Scale/AUM (+) 2 BRS (+) NYC Relocation (+) 3 (4Q only) FY25 Baseline Adjusted Margin As of 12/31/2024 Source: AB 4Q24 Earnings Review
Slide 15: Appendix
Appendix 4Q24 Earnings Review 15
Slide 16: Retail Mutual Funds Relative Performance vs. Morningstar Averages
Retail Mutual Funds Relative Performance vs. Morningstar Averages 1 Year 3 Year 5 Year 10 Year Relative Relative Relative Relative Retail Service (%) Percentile (%) Percentile (%) Percentile (%) Percentile Equity Large Cap Growth (3.5) 69 (0.3) 62 0.5 47 1.7 19 Concentrated Growth (17.9) 98 (6.7) 95
Slide 17: Retail Mutual Funds Relative Performance vs. Morningstar Averages
Retail Mutual Funds Relative Performance vs. Morningstar Averages 1 Year 3 Year 5 Year 10 Year Service Relative (%) Percentile Relative (%) Percentile Relative (%) Percentile Relative (%) Percentile Fixed Income American Income (1.0) 66 (0.9) 69 (0.6) 71 0.1 39 European Income 0.2 43 (0.3) 57 0.3 38
Slide 18: Institutional Composite Relative Performance vs. Benchmarks
Institutional Composite Relative Performance vs. Benchmarks Service 1 Year 3 Year 5 Year 10 Year Equity US Small Cap Growth 4.6 (4.4) 1.8 3.7 Concentrated Global Growth (9.3) (9.3) (4.8) (0.4) Global Core (6.4) (2.8) (2.6) (0.1) International Strategic Core 6.0 1.7 0.8 1.6 Sustainable Global Themati
Slide 19: Assets Under Management: 4Q24
Assets Under Management: 4Q24 (US $ Billions) September 30, December 31, 2024 2024 Institutions Private Wealth Retail Total Total Equity Actively Managed $49 $54 $160 263 271 Passive (1) 24 6 38 68 69 Total Equity 73 60 198 331 340 Fixed Income Taxable 117 19 74 210 217 Tax-Exempt 1 30 45 76 71 Pass
Slide 20: Three Months Ended 12/31/24: AUM Roll-Forward by Distribution Channel
Three Months Ended 12/31/24: AUM Roll-Forward by Distribution Channel In US $ Billions Beginning Sales/New Redemptions/ Net Cash Net Investment Net End Investment Service: of Period Accounts Terminations Flows Flows Adjustm(1) Performance Change of Period Institutions US $163.2 $1.6 $(0.7) $(1.1) $(
Slide 21: Twelve Months Ended 12/31/24: AUM Roll-Forward by Distribution Channel
Twelve Months Ended 12/31/24: AUM Roll-Forward by Distribution Channel In US $ Billions Beginning Sales/New Redemptions/ Net Cash Net Investment Net End Investment Service: of Period Accounts Terminations Flows Flows Adjustm(1) Transfers Performance Change of Period Institutions US $150.5 $9.6 $(2.9
Slide 22: Three Months Ended 12/31/24: AUM Roll-Forward by Investment Service
Three Months Ended 12/31/24: AUM Roll-Forward by Investment Service In US $ Billions Beginning Sales/New Redemptions/ Net Cash Net AUM Investment Net End Investment Service: of Period Accounts Terminations Flows Flows Adj (3) Performance Change of Period Equity Active US $186.9 $8.7 $(9.5) $(3.3) $(
Slide 23: Twelve Months Ended 12/31/24: AUM Roll-Forward by Investment Service
Twelve Months Ended 12/31/24: AUM Roll-Forward by Investment Service In US $ Billions Beginning Sales/New Redemptions/ Net Cash Net AUM Investment Net End Investment Service: of Period Accounts Terminations Flows Flows (3) (3) Adj Transfers Performance Change of Period Equity Active US $161.3 $37.6
Slide 24: Active vs. Passive Net Flows
Active vs. Passive Net Flows Three Months Ended 12/31/24 Actively Passively Managed Managed (1) Total Equity (1) $ (7.4) $ (1.4) $ (8.8) Fixed Income 4.8 (0.6) 4.2 Alternatives/MAS (2) (0.4) 0.2 (0.2) Total $ (3.0) $ (1.8) $ (4.8) Twelve Months Ended 12/31/24 Actively Passively Managed Managed (1) T
Slide 25: Assets Under Management By Region
Assets Under Management By Region Institutional Geographic Breakdown Retail Geographic Breakdown Japan Other Other APAC ex 3% 3% 2% Japan 6% EMEA 9% EMEA Japan 11% 12% APAC ex Japan 17% US US 60% 77% $321.4B $334.3B As of December 31, 2024 By Client Domicile Percentages may not add up to 100% due to
Slide 26: Fourth Quarter and Full Year 2024 Adjusted Advisory Fees
Fourth Quarter and Full Year 2024 Adjusted Advisory Fees 4Q24 4Q23 %∆ FY 2024 FY 2023 %∆ Ending AUM ($ Billions) $792 $725 9% $792 $725 9% Average AUM ($ Billions) $801 $685 17 % $769 $680 13 % By Fee Type ($ Millions): Adjusted Base Fees(1) $798 $682 17 % $3,049 $2,717 12 % Adjusted Performance Fee
Slide 27: Fourth Quarter and Full Year 2024 GAAP Income Statement
Fourth Quarter and Full Year 2024 GAAP Income Statement In US $ Millions (except EPU) 4Q24 4Q23 %∆ FY 2023 FY 2022 %∆ Net Revenues $ 1,258 $ 1,090 15% $ 4,475 $ 4,155 8% Operating Expenses 940 852 10% 3,351 3,337 0% Operating Income 318 238 33% 1,124 818 38% Net Income Attributable to AB Unitholders
Slide 28: Fourth Quarter and Full Year 2024 AB Holding Financial Results
Fourth Quarter and Full Year 2024 AB Holding Financial Results In US $ Millions (excluding per Unit amounts) 4Q24 4Q23 %∆ FY 2024 FY 2023 %∆ AB Net Income Attributable to AllianceBernstein $300 $227 32 % $1,173 $765 53 % Weighted Average Equity Ownership Interest 38.9% 38.9 % 39.4% 39.2 % AB Holding
Slide 29: Fourth Quarter 2024 GAAP to Non-GAAP Reconciliation
Fourth Quarter 2024 GAAP to Non-GAAP Reconciliation In US $ Thousands Adjustments Distribution Pass Deferred Pension NCI/ Real Estate Acquisition- Equity Related Through Comp. Obligation Consol Credits Related Method Interest GAAP Payments Adjustments Inv. Settlement VIE (Charges) Expenses Investmen
Slide 30: Fourth Quarter 2023 GAAP to Non-GAAP Reconciliation
Fourth Quarter 2023 GAAP to Non-GAAP Reconciliation In US $ Thousands Adjustments Distribution Pass Deferred NCI/ Real Estate Acquisition- Related Through Comp. Consol Credits Related Interest GAAP Payments Adjustments Inv. VIE (Charges) Expenses Expense Non-GAAP (A) (B) (C) (E) (F) (G) (I) Investme
Slide 31: Full Year 2024 GAAP to Non-GAAP Reconciliation
Full Year 2024 GAAP to Non-GAAP Reconciliation In US $ Thousands Adjustments Distribution Pass Deferred Pension NCI/ Real Estate Acquisition- Equity (Gain) loss Related Through Comp. Obligation Consol Credits Related Method Interest on GAAP Payments Adjustments Inv. Settlement VIE (Charges) Expenses
Slide 32: Full Year 2023 GAAP to Non-GAAP Reconciliation
Full Year 2023 GAAP to Non-GAAP Reconciliation In US $ Thousands Adjustments Distribution Pass Deferred NCI/ Real Estate Acquisition- Related Through Comp. Consol Credits Related Interest GAAP Payments Adjustments Inv. VIE (Charges) Expenses Expense Non-GAAP (A) (B) (C) (E) (F) (G) (I) Investment ad
Slide 33: AB Adjusted Financial Results Reconciliation
AB Adjusted Financial Results Reconciliation Notes to Consolidated Statements of Income and Supplemental Information (Unaudited) A. We exclude all of the company’s distribution revenues, which are recorded as a separate line item on the consolidated statement of income, as well as a portion of inves
Slide 34: AllianceBernstein
ALLIANCEBERNSTEIN'
AllianceBernstein Holding L.P. Units — Q4 2024 Earnings Presentation on 6ix