Hamilton Lane Incorporated · NASDAQ:HLNE
Hamilton Lane — Q1 2023 Earnings Presentation
22 slides from Hamilton Lane's earnings presentation, Aug 2, 2022
Slide 1: Fiscal Year 2023 First Quarter Results
Fiscal Year 2023 First Quarter Results Earnings Presentation - August 2, 2022 Hamilton Lane l Global Leader in the Private Markets 1
Slide 2: Today's Speakers
Today's Speakers Erik Hirsch Brian Gildea Atul Varma John Oh Vice Chairman Head of Investment Solutions Chief Financial Officer Investor Relations Manager Hamilton Lane l Global Leader in the Private Markets 2
Slide 3: Period Highlights
Period Highlights Business Performance • Assets under management and fee-earning assets under management were $108 billion and $51 billion, respectively, as of June 30, 2022, increases of 18% and 20%, respectively, compared to June 30, 2021 • Management and advisory fees increased 16% compared to th
Slide 4: Growing Asset Footprint & Influence
Growing Asset Footprint & Influence $832B AUM & AUA Total Assets Under Management/Advisement ($B)1 $1,000 $98 $108 Y-o-Y Growth $800 AUM: 18 % AUA: 9% $ 724 $753 R: 20% $76 $600 CAG $66 $59 $581 $50 $400 $422 $410 $40 $374 $35 $32 $292 $200 $24 $30 $22 $205 $16 $189 $19 $147 $13 $147 $11 $6 $7 $95 $
Slide 5: Fee-Earning AUM Driving Revenues
Fee-Earning AUM Driving Revenues Fee-Earning AUM growth continues and annual fee rates are stable Total Fee-Earning Assets Under Management ($B) .55% .56% .60% .56% .55% .57% $60 $51 12% $49 $50 CAGR: $42 $43 $39 $19 $40 $18 $34 $31 $16 $16 $14 $30 $11 $10 $20 $31 $32 $25 $26 $26 $10 $21 $22 $0 Mar-
Slide 6: AUM & AUA Drivers
AUM & AUA Drivers AUM AUA Customized Specialized Advisory Separate Accounts Funds Services Diverse mix of existing and Select funds in market: Typically larger clients with wide- prospective clients seeking • Direct equity fund ranging mandates which include technology-driven reporting, to further o
Slide 7: Financial Highlights
Financial Highlights Hamilton Lane l Global Leader in the Private Markets 7
Slide 8: Consolidated Revenue
Consolidated Revenue Strong revenue growth across management and advisory fees Management and Advisory Fees Long-Term Growth YTD Y-o-Y Growth: 16% CAGR: 13% • Recurring management and advisory fees represented an average of 85% of total revenues over the past five fiscal years USD in Millions USD in
Slide 9: Unrealized Carried Interest
Unrealized Carried Interest Unrealized Carried Interest Unrealized Carry by Age 100 90 $1,500 > 12 years 83 4% $1,250 80 $1,000 USD in Millions 56 60 Vehicles 8-12 years 19% $750 40 $1,102 $500 < 5 years 49% $809 20 $250 $311 5-8 years 28% 0 $0 Jun-20 Jun-21 Jun-22 Period Ending Unrealized Carried I
Slide 10: Consolidated Earnings
Consolidated Earnings Profitability stable and growing Net Income Attributable to HLI YTD Y-o-Y Growth: 19% Long-Term Growth • $33M in net income attributable to HLI for the quarter USD in Millions $146 USD in Millions $33 $28 1 $1 FY17 FY22 Q1 FY22 Q1 FY23 2 Adjusted EBITDA YTD Long-Term Growth • Y
Slide 11: Other Key Items
Other Key Items Strong balance sheet with investments in our own products and a modest amount of leverage... Investments $600 $500 $567 • For 6/30/22, the total investment balance consisted of: $514 ◦ ~$366M in equity method investments in our USD in Millions $400 funds $374 $300 ◦ ~$201M in technol
Slide 12: Appendix
Appendix Hamilton Lane l Global Leader in the Private Markets 12
Slide 13: Condensed Consolidated Statements of Income (Unaudited)
Condensed Consolidated Statements of Income (Unaudited) Three Months Ended (Dollars in thousands except share and per share amounts) June 30, 2021 March 31, 2022 June 30, 2022 YoY Change % QoQ Change % Management and advisory fees $73,884 $84,575 $85,946 16 % 2% Incentive fees 2,364 13,916 49,524 1,
Slide 14: Non-GAAP Financial Measures
Non-GAAP Financial Measures Three Months Ended (Dollars in thousands except share and per share amounts) June 30, 2021 March 31, 2022 June 30, 2022 YoY Change % QoQ Change % 1 Adjusted EBITDA Management and advisory fees $73,884 $84,575 $85,946 16 % 2% Total expenses 43,245 54,633 72,984 69 % 34 % L
Slide 15: Management and Advisory Fees
Management and Advisory Fees Three Months Ended, (Dollars in thousands) June 30, 2021 March 31, 2022 June 30, 2022 YoY Change % QoQ Change % Management and advisory fees Specialized funds $33,388 $42,144 $43,649 31 % 4% Customized separate accounts 24,500 27,813 28,375 16 % 2% Advisory 6,366 6,191 6
Slide 16: Incentive Fees
Incentive Fees Three Months Ended (Dollars in thousands) June 30, 2021 March 31, 2022 June 30, 2022 YoY Change % QoQ Change % Incentive fees Direct equity funds $2,747 $2,410 $24,851 805 % 931 % Secondary funds 30 — 11,959 40,122 % N/A Direct credit funds 4 18 2,125 49,666 % 11,706 % Evergreen funds
Slide 17: Assets Under Management
Assets Under Management (Dollars in millions) June 30, 2021 March 31, 2022 June 30, 2022 YoY Change % QoQ Change % Assets under management / advisement Assets under management $91,668 $106,382 $108,034 18 % 2% Assets under advisement 665,024 794,732 724,160 9% (9)% Total assets under management /adv
Slide 18: Condensed Consolidated Balance Sheets (Unaudited)
Condensed Consolidated Balance Sheets (Unaudited) (Dollars in thousands except share and per share amounts) March 31, 2022 June 30, 2022 Assets Cash and cash equivalents $72,138 $83,052 Restricted cash 4,023 3,996 Fees receivable 51,869 44,982 Prepaid expenses 6,858 6,575 Due from related parties 1,
Slide 19: Condensed Consolidated Statements of Cash Flows (Unaudited)
Condensed Consolidated Statements of Cash Flows (Unaudited) Three Months Ended June 30, (Dollars in thousands) 2021 2022 Operating activities Net income $44,681 $56,126 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 1,378 1,764 Change
Slide 20: Non-GAAP Reconciliation
Non-GAAP Reconciliation Reconciliation from Net Income Year Ended March 31, Three Months Ended (Dollars in thousands except share and per share amounts) 2017 2022 June 30, 2021 March 31, 2022 June 30, 2022 Net income attributable to Hamilton Lane Incorporated $612 $145,986 $28,168 $13,825 $33,484 In
Slide 21: Terms
Terms Adjusted EBITDA is an internal measure of profitability. We believe Adjusted EBITDA is useful to investors because it enables them to better evaluate the performance of our core business across reporting periods. Adjusted EBITDA represents net income excluding (a) interest expense on our outst
Slide 22: Disclosures
Disclosures Some of the statements in this presentation may constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995. Words such as "will", "exp