Artisan Partners Asset Management Inc. · NYSE:APAM
Artisan Partners Asset Management — Q2 2015 Earnings Presentation
24 slides from Artisan Partners Asset Management's earnings presentation, Jul 28, 2015
Slide 1: Business Update and Second Quarter 2015 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 S E C O N D Q U A R T E R 2 0 1 5 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 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. w
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 Seven autonomous investment teams managing fifteen investment strategies for sophisticated, institutional investors Principal offices in Milwauk
Slide 4: Long-Term Investment Results — Full Cycle Return Goals
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 LONG-TERM INVESTMENT RESULTS — Full Cycle Return Goals Note: Data as of and through June 30, 2015. Average Annual Total Returns represents gross of fees performance for the Artisan Composites. Value add measures the average annual outperf
Slide 5: 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 4 INVESTMENT PERFORMANCE — Outperformance and Rankings Sources: Artisan Partners/Lipper Inc/Morningstar. % of AUM in Outperforming Strategies at December 31 of each year. % of AUM in Outperforming Strategies represents the % of AUM in strat
Slide 6: 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 5 Channel Diversification1 Team Diversification AUM by Client DomicileAUM by Vehicle 1 The allocation of AUM by distribution channel involves the use of estimates and the exercise of judgment. BUSINESS DISCIPLINE — Firm Asset Diversificatio
Slide 7: 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 6 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 8: Talent Driven Business Model — Business Structure
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 TALENT DRIVEN BUSINESS MODEL — Business Structure Talent Focus Management Guideposts Strong Long-Term Investment Results Asset Diversification Financial Discipline
Slide 9: Talent Driven Business Model — 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 8 TALENT DRIVEN BUSINESS MODEL — Investment Teams Talent Focus Strong Long-Term Investment Results Asset Diversification Financial Discipline Management Guideposts
Slide 10: Talent Driven Business Model — Growth Team
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 DRIVEN BUSINESS MODEL — Growth Team $0 $5 $10 $15 $20 $25 $30 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 A U M ( $ b n ) U.S. Mid-Cap Growth Global Opportunities U.S. Small-Cap Growth
Slide 11: Talent Driven Business Model — Talent 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 10 TALENT DRIVEN BUSINESS MODEL — Talent Management Investment Team Lifecycle Early Development Realizable Capacity Mature Franchise Franchise Decline Individual Team Franchise Multiple Decision Makers Proven Track Record Defined Culture Es
Slide 12: Summary of June Quarter 2015 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 11 AUM increased less than 1% to $109.2 billion Average AUM increased 3% to $111.4 billion Net outflows of $305 million Revenues increased 4% to $211.5 million GAAP operating margin of 37.0% GAAP net income per basic and diluted
Slide 13: 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 12 ASSETS UNDER MANAGEMENT & NET CLIENT CASH FLOWS (in billions) Net Client Cash Flows $112.0 $106.2 $107.9 $108.7 $109.2 $108.2 $110.2 $106.9 $108.4 $111.4 2Q14 3Q14 4Q14 1Q15 2Q15 Assets Under Management Ending Assets Under Management Ave
Slide 14: 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 13 GLOBAL DISTRIBUTION (in billions) U.S. vs. Non-U.S. Client Net Flows 12% 12% 13% 13% $13.5 $13.0 $13.9 $13.8 $14.2 2Q14 3Q14 4Q14 1Q15 2Q15 Non-U.S. Client AUM Non-U.S. Cl ient AUM as a % of Fi rmwide AUM Non-U.S. Cl ient AUM 13% (0.3) (
Slide 15: 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 14 FINANCIAL RESULTS — Financial Highlights Average AUM (in billions) Revenues (in millions) Quarter Year To Date $108.2 $108.4 $111.4 2Q14 1Q15 2Q15 $107.2 $109.9 YTD 2014 YTD 2015 $208.5 $203.6 $211.5 2Q14 1Q15 2Q15 $410.3 $415.1 YTD 2014
Slide 16: 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 15 FINANCIAL RESULTS — Financial Highlights Adjusted Operating Margin1 Adjusted Net Income (in millions) & Adjusted Net Income per Share1 Adjusted Net Income per Adjusted ShareAdjusted Net Income 2Q14 1Q15 2Q15 1 Operating Margin (GAAP) for
Slide 17: 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 16 Salary & Incentives decreased in the June 2015 quarter due to the on-boarding of our new Developing World investment team in the March 2015 quarter. Benefits & Payroll taxes decreased in the June 2015 quarter due in part to seasonal
Slide 18: 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 17 FINANCIAL RESULTS — Capital Management ¹ Calculated in accordance with debt agreements. $182.3 $215.5 4Q14 2Q15 Cash (in millions) $200.0 $200.0 4Q14 2Q15 Borrowings (in millions) 0.5x 0.5x 4Q14 2Q15 Leverage Ratio1 $107.5 $112.0 4Q14 2Q
Slide 19: 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 18 FINANCIAL RESULTS — Dividends Note: Time periods noted above represent the period in which the dividends were paid $0.43 $0.55 $0.60 $0.60 $0.60 2013 2014 1Q15 2Q15 3Q15 Quarterly Dividend Rate
Slide 20: Appendix
APPENDIX
Slide 21: 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 20 RECONCILIATION OF GAAP TO NON-GAAP (“ADJUSTED”) MEASURES (in millions) June 30 March 31 June 30 June 30 June 30 2015 2015 2014 2015 2014 Net income attributable to Artisan Partners Asset Management Inc. (GAAP) 23.8 19.5 19.3 43.3 27.9 Ad
Slide 22: 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 21 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 23: 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 22 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
Slide 24: Notes & Disclosures — Financial Information
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 NOTES & DISCLOSURES Financial Information Throughout these materials, we present historical information about our assets under management and our average assets under management for certain periods. We use our information management syst
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