Affiliated Managers Group, Inc. · NYSE:AMG
Affiliated Managers — Investor Presentation (October 2018)
28 slides from Affiliated Managers's investor presentation, October 2018
Slide 1: Investor Overview Q3 2018
Investor Overview Q3 2018
Slide 2: Forward-Looking Statements
Forward-Looking Statements Certain matters discussed in this presentation, as well as oral statements made by AMG, may constitute forward-looking statements within the meaning of the federal securities laws. These statements include, but are not limited to, statements related to our expectations reg
Slide 3: AMG Overview
AMG Overview Business Highlights Key Facts Global, diversified asset management firm Founded: 1993 Unique, multi-faceted growth strategy Market Cap: $6.1 billion (S&P 500® / NYSE: AMG) Proprietary opportunity to partner with additional Assets Under Management: $830 billion top boutiques around the w
Slide 4: AUM is Diversified Across Regions, Client Type and Products
AUM is Diversified Across Regions, Client Type and Products Nearly half of AUM from clients domiciled outside the United States Institutional-oriented business with 72% of AUM from institutions and HNW clients 73% of AUM in global equities and alternative strategies AMG’s AUM Contribution Client Loc
Slide 5: Diverse Exposures Across Broad Array of Traditional and Alternative Strategies
Diverse Exposures Across Broad Array of Traditional and Alternative Strategies Given AMG’s strategic focus on the most attractive alpha-generating products, high-conviction active Equities equities and alternatives account for virtually all of 48% 26% the company’s $830 billion in AUM Uniquely posit
Slide 6: Strategic Focus on Alternatives and Active Equities
Strategic Focus on Alternatives and Active Equities Alternatives Global Equities U.S. Equities 39% 34% 14% Premier research-driven quantitative Premier research-driven quantitative Fundamental growth and investment management firm investment management firm relative value equity specialist Largest d
Slide 7: Global Distribution Platform Enhances Affiliate Reach
Global Distribution Platform Enhances Affiliate Reach AMG’s global distribution strategy provides high-quality marketing and client service resources in key international markets Complements Affiliate-level marketing and distribution with the scale and resources of a global asset management firm AMG
Slide 8: Summary of Client Cash Flows
Summary of Client Cash Flows Organic growth profile driven by diverse array of distinctive return streams Quarterly Client Cash Flows Rolling One Year Client Cash Flows $45 $40 $160 $40 Client cash inflows and commitments ($bn) Client cash inflows and commitments ($bn) $39 $35 $140 $35 $36 $36 $36 $
Slide 9: Strong Long Term Investment Performance (AUM Ahead of Benchmark)
Strong Long Term Investment Performance (AUM Ahead of Benchmark) Liquid Alternatives(1): 29% of AUM Illiquid Alternatives: 10% of AUM 86% 92% 71% 79% 3 Year 5 Year Net Multiple vs. Benchmark Net IRR vs. Benchmark Global Equity: 34% of AUM U.S. Equity: 14% of AUM 69% 51% 35% 30% 3 Year 5 Year 3 Year
Slide 10: AUM Growth Driven by Innovation and Diversification Since 2008
AUM Growth Driven by Innovation and Diversification Since 2008 CAGR: 7% CAGR: 18% $404 $322 CAGR: 12% Equities Alternatives $191 Product Strategy $104 48% 39% $53 $30 Alternatives Equities Multi-Asset & Other Multi-Asset 2008 2018 2008 2018 2008 2018 13% Alternatives Equities Multi-Asset(1) CAGR: 9%
Slide 11: Consistent Return of Capital While Maintaining Flexibility
Consistent Return of Capital While Maintaining Flexibility Consistent Capital Return 59 $1.00 Consistent Share Reduced share count by 7% Repurchases since beginning of 2017 $0.90 Average Shares Outstanding (Adjusted 58 57.1 $0.80 Quarterly Dividend per Share 57 56.6 56.1 55.9 $0.70 56 Diluted) (mm)(
Slide 12: Unique Growth Strategy
Unique Growth Strategy With a 25-year track record of successful investments and established relationships with leading independent firms, AMG has an outstanding forward opportunity set and is well-positioned to execute Key Elements of Approach Illustrative Size of Opportunity Build senior-level rel
Slide 13: Successful Execution of Business Strategy
Successful Execution of Business Strategy Through the successful execution of its growth strategy, AMG has created a virtuous circle and is positioned to continue to build outstanding shareholder value going forward Distribution: Industry-leading net client cash flows of over $130 billion into activ
Slide 14: Outstanding Earnings Growth Through Excellent Execution
Outstanding Earnings Growth Through Excellent Execution Assets Under Management ($bn) Aggregate Fees(1) ($mm) Adjusted EBITDA ($mm) CAGR: 18% CAGR: 14% CAGR: 14% $830 $5,896 $1,132 $942 $611 $820 $3,907 $4,140 $537 $1,627 $309 $170 2008 2013 2015 3Q18 2008 2013 2015 LTM (3Q) 2008 2013 2015 LTM (3Q)
Slide 15: Outstanding Track Record of Earnings Growth and Value Creation
Outstanding Track Record of Earnings Growth and Value Creation Earnings Growth and Stockholder Return Unique growth strategy includes organic growth of Total Return Since IPO (1997 – 2018 YTD) existing Affiliates supported by Affiliate- and AMG- +1466% level marketing capabilities, as well as new Af
Slide 16: Appendix
Appendix
Slide 17: AMG-Selected Composites by Product Category
AMG-Selected Composites by Product Category(1) AUM Performance (2) Strategy Weight Selected Composite Q1 Q2 Q3 YTD HFRI Equity Hedge Index 0.3% 0.9% 0.5% 1.7% FI / Equity Relative Value 9% HFRI Relative Value 0.4% 1.2% 1.3% 3.0% Alternatives HFRI Event Driven Activist (2.3%) 4.0% (1.1%) 0.5% Systema
Slide 18: Operating and Financial Measures (Three and Nine Months Ended)
Operating and Financial Measures (Three and Nine Months Ended) Three Months Ended Nine Months Ended (in millions, except as noted and per share data) 9/30/17 9/30/18 9/30/17 9/30/18 Operating performance measure Assets under management (at period end, in billions) (A) $ 803.7 $ 829.6 $ 803.7 $ 829.6
Slide 19: Q3'18 Assets Under Management by Strategy
Q3’18 Assets Under Management by Strategy Quarter to Date: Global Multi-asset Statement of Changes— Quarter to Date Alternatives Equities U.S. Equities & Other Total Assets under management, June 30, 2018 $ 322.0 $ 283.3 $ 116.0 $ 102.9 $ 824.2 Client cash inflows and commitments 17.0 10.0 4.7 4.5 3
Slide 20: Q3'18 Assets Under Management by Client Type
Q3’18 Assets Under Management by Client Type Quarter to Date: Statement of Changes— Quarter to Date Institutional Retail High Net Worth Total Assets under management, June 30, 2018 $ 477.3 $ 231.2 $ 115.7 $ 824.2 Client cash inflows and commitments 20.8 11.4 4.0 36.2 Client cash outflows (15.1) (16.
Slide 21: Consolidated Statements of Income
Consolidated Statements of Income Three Months Ended Nine Months Ended (in millions, except per share data) 9/30/17 9/30/18 9/30/17 9/30/18 Consolidated revenue $ 585.7 $ 601.3 $ 1,700.9 $ 1,813.9 Consolidated expenses: Compensation and related expenses 238.7 253.6 722.9 761.3 Selling, general and a
Slide 22: Reconciliations of Performance Measures (Three Months Ended)
Reconciliations of Performance Measures (Three Months Ended) Three Months Ended (in millions, except per share data) 9/30/17 12/31/17 3/31/18 6/30/18 9/30/18 Net income (controlling interest) $ 125.4 $ 315.4 $ 153.0 $ 117.0 $ 124.9 Intangible amortization and impairments 42.2 143.9 47.6 74.4 44.9 In
Slide 23: Consolidated Balance Sheets, December 31, 2017 – September 30, 2018
Consolidated Balance Sheets, December 31, 2017 – September 30, 2018 (in millions) 12/31/17 9/30/18 Assets Cash and cash equivalents $ 439.5 $ 448.1 Receivables 433.8 524.5 Goodwill 2,662.5 2,648.4 Acquired client relationships (net) 1,449.7 1,357.4 Equity method investments in Affiliates (net) 3,304
Slide 24: Operating and Financial Measures
Operating and Financial Measures Year Ended (in millions, except as noted and per share data) 12/31/16 12/31/17 Operating Performance Measures Assets under management (at period end, in billions) (A) $ 688.7 $ 836.3 Average assets under management (in billions) (A) $ 655.6 $ 779.2 Consolidated Affil
Slide 25: Consolidated Statements of Income
Consolidated Statements of Income Year Ended (in millions, except per share data) 12/31/15 12/31/16 12/31/17 Consolidated revenue $ 2,484.5 $ 2,194.6 $ 2,305.0 Consolidated expenses: Compensation and related expenses 1,027.7 932.4 979.0 Selling, general and administrative 443.8 398.1 373.1 Intangibl
Slide 26: Reconciliations of Performance Measures
Reconciliations of Performance Measures Year Ended (in millions, except per share data) 12/31/15 12/31/16 12/31/17 Net income (controlling interest) $ 509.5 $ 472.8 $ 689.5 Intangible amortization and impairments 118.4 142.5 265.4 Intangible-related deferred taxes 77.7 84.3 48.8 Other economic items
Slide 27: Economic EPS: Notes
Economic EPS: Notes 1. Prior to Q1 2002, Economic EPS represents Net Income plus depreciation and amortization on a per share basis. With the adoption of FAS 142 at the beginning of 2002, Economic EPS represents Net Income plus depreciation and amortization and deferred taxes generally related to in
Slide 28: Notes
Notes (A) Assets under management is presented on a current basis without regard to the timing of the inclusion of an Affiliate’s results in our operating performance measures or Consolidated Financial Statements. Average assets under management provides a more meaningful relationship to our operati
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