[PART I — FINANCIAL INFORMATION](index=3&type=section&id=Part%20I%20%E2%80%94%20Financial%20Information) This section presents the company's unaudited condensed consolidated financial information for the reported periods [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents Acadian Asset Management Inc.'s unaudited condensed consolidated financial statements and detailed notes for the periods ended June 30, 2025 and 2024 [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This section provides a snapshot of the company's financial position, detailing assets, liabilities, and equity at specific points in time Condensed Consolidated Balance Sheets (in millions) | Item | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :---------------- | | **Assets** | | | | Cash and cash equivalents | $90.2 | $94.8 | | Investment advisory fees receivable | $124.2 | $164.7 | | Investments | $55.2 | $67.9 | | Total assets | $672.3 | $703.2 | | **Liabilities** | | | | Accrued incentive compensation | $66.0 | $119.6 | | Revolving credit facility | $20.0 | — | | Total liabilities | $585.4 | $616.1 | | **Equity** | | | | Retained earnings | $11.3 | $24.4 | | Total equity and redeemable non-controlling interests | $86.9 | $87.1 | - **Total assets** decreased by **$30.9 million** (**4.4%**) from **$703.2 million** at December 31, 2024, to **$672.3 million** at June 30, 2025, primarily due to decreases in investment advisory fees receivable and investments[8](index=8&type=chunk) - **Total liabilities** decreased by **$30.7 million** (**5.0%**) from **$616.1 million** at December 31, 2024, to **$585.4 million** at June 30, 2025, largely driven by a significant decrease in accrued incentive compensation[8](index=8&type=chunk) [Condensed Consolidated Statements of Operations](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) This section outlines the company's financial performance over specific periods, detailing revenues, expenses, and net income Condensed Consolidated Statements of Operations (in millions, except per share data) | Item | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | YoY Change (3M) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | YoY Change (6M) | | :-------------------------------------- | :--------------------------- | :--------------------------- | :-------------- | :--------------------------- | :--------------------------- | :-------------- | | Total revenue | $127.4 | $109.0 | +16.9% | $247.3 | $214.7 | +15.2% | | Total operating expenses | $111.2 | $88.4 | +25.8% | $199.2 | $171.2 | +16.3% | | Operating income | $16.2 | $20.6 | -21.3% | $48.1 | $43.5 | +10.6% | | Income before income taxes | $23.6 | $17.1 | +38.0% | $55.7 | $38.9 | +43.2% | | Net income attributable to controlling interests | $10.1 | $11.0 | -8.2% | $30.2 | $25.6 | +18.0% | | Basic EPS attributable to controlling interests | $0.28 | $0.29 | -3.4% | $0.82 | $0.67 | +22.4% | | Diluted EPS attributable to controlling interests | $0.28 | $0.29 | -3.4% | $0.82 | $0.66 | +24.2% | - **Net consolidated Funds' investment gains** significantly increased to **$12.1 million** for the three months ended June 30, 2025, from **$0.8 million** in the prior year, and to **$15.7 million** for the six months ended June 30, 2025, from **$2.5 million** in the prior year[10](index=10&type=chunk) [Condensed Consolidated Statements of Comprehensive Income](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income) This section presents the company's net income and other comprehensive income components, reflecting changes in equity from non-owner sources Condensed Consolidated Statements of Comprehensive Income (in millions) | Item | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :---------------------------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Net income | $19.1 | $11.5 | $42.9 | $27.2 | | Total other comprehensive income | $1.1 | $0.8 | $2.3 | $1.3 | | Total comprehensive income attributable to controlling interests | $11.2 | $11.8 | $32.5 | $26.9 | - **Total other comprehensive income** increased for both the three-month period (from **$0.8 million** to **$1.1 million**) and the six-month period (from **$1.3 million** to **$2.3 million**) ended June 30, 2025, primarily due to amortization related to derivative securities and foreign currency translation adjustments[12](index=12&type=chunk) [Condensed Consolidated Statements of Changes in Stockholders' Equity](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Stockholders%27%20Equity) This section details the changes in the company's equity accounts, including net income, stock repurchases, and dividends Key Changes in Stockholders' Equity (in millions) | Item | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :-------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Net income | $10.1 | $11.0 | $30.2 | $25.6 | | Repurchase of common stock | $(23.8) | $(20.7) | $(43.4) | $(95.7) | | Dividends paid | $(0.4) | $(0.4) | $(0.8) | $(0.8) | | Total equity and redeemable non-controlling interests (End of Period) | $86.9 | $(18.8) | $86.9 | $(18.8) | - The company repurchased **0.9 million** shares for **$23.8 million** in Q2 2025, compared to **0.9 million** shares for **$20.7 million** in Q2 2024. For the six months, repurchases were **1.7 million** shares for **$43.4 million** in 2025, down from **4.4 million** shares for **$95.7 million** in 2024[13](index=13&type=chunk)[14](index=14&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section reports the cash generated and used by the company across operating, investing, and financing activities Condensed Consolidated Statements of Cash Flows (in millions) | Cash Flow Activity | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :----------------------------------- | :--------------------------- | :--------------------------- | | Net cash flows from operating activities | $12.8 | $5.3 | | Net cash flows from investing activities | $9.1 | $(18.8) | | Net cash flows from financing activities | $(26.9) | $(60.6) | | Net decrease in cash and cash equivalents | $(4.6) | $(74.2) | | Cash and cash equivalents at end of period | $93.9 | $73.4 | - **Net cash from operating activities** (including consolidated Funds) increased by **$7.5 million**, from **$5.3 million** in 2024 to **$12.8 million** in 2025[16](index=16&type=chunk) - **Net cash from investing activities** significantly improved, moving from an outflow of **$(18.8) million** in 2024 to an inflow of **$9.1 million** in 2025, primarily due to higher net sales of investment securities[16](index=16&type=chunk) - **Net cash used in financing activities** decreased by **$33.7 million**, from **$(60.6) million** in 2024 to **$(26.9) million** in 2025, mainly due to lower **common stock repurchases**[18](index=18&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanations and disclosures supporting the condensed consolidated financial statements [1) Organization and Description of the Business](index=10&type=section&id=1)%20Organization%20and%20Description%20of%20the%20Business) This note describes Acadian Asset Management Inc.'s business operations and organizational structure - **Acadian Asset Management Inc.** operates a systematic investment management business through its majority-owned subsidiary, Acadian Asset Management LLC ('Acadian LLC'), offering diversified systematic investment strategies to institutional investors globally[21](index=21&type=chunk) - The company's **Quant & Solutions segment** utilizes advanced technology to identify mispriced assets and generate risk-adjusted returns, covering global, emerging market, non-U.S., small cap, enhanced equities, credit, and alternative strategies[21](index=21&type=chunk) Common Stock Repurchases (in millions) | Period | Shares Repurchased | Total Value (including commissions) | | :-------------------------------- | :----------------- | :---------------------------------- | | 6 Months Ended June 30, 2025 | 1,696,553 | $43.0 | | 6 Months Ended June 30, 2024 | 4,445,534 | $94.9 | [2) Basis of Presentation and Significant Accounting Policies](index=11&type=section&id=2)%20Basis%20of%20Presentation%20and%20Significant%20Accounting%20Policies) This note outlines the accounting principles and policies used in preparing the financial statements - The unaudited Condensed Consolidated Financial Statements are prepared in accordance with U.S. GAAP for interim financial information and SEC rules, with all normal and recurring adjustments included[26](index=26&type=chunk) - Management makes estimates and assumptions that affect reported amounts, and actual results may differ materially[28](index=28&type=chunk) - The company adopted ASU 2024-01 (Compensation - Stock Compensation) in March 2024 with no material impact and is evaluating ASU 2023-09 (Income Taxes) and ASU 2024-03 (Expense Disaggregation Disclosures) for future periods, not expecting a material impact from ASU 2023-09[29](index=29&type=chunk)[31](index=31&type=chunk)[32](index=32&type=chunk) [3) Investments](index=12&type=section&id=3)%20Investments) This note details the composition and valuation of the company's investment portfolio Investments Breakdown (in millions) | Investment Type | June 30, 2025 | December 31, 2024 | | :------------------------------------------ | :------------ | :---------------- | | Investments of consolidated Funds | $170.5 | $154.0 | | Other investments | $19.3 | $19.4 | | Investments related to long-term incentive compensation plans | $35.9 | $48.5 | | Total investments | $225.7 | $221.9 | - Unrealized gains for investments of consolidated Funds were **$12.3 million** for the three months ended June 30, 2025 (vs. **$(0.2) million** in 2024) and **$15.5 million** for the six months ended June 30, 2025 (vs. **$0.6 million** in 2024)[35](index=35&type=chunk) [4) Fair Value Measurements](index=13&type=section&id=4)%20Fair%20Value%20Measurements) This note explains the methodologies and hierarchy used to measure the fair value of assets and liabilities Fair Value Assets (in millions) as of June 30, 2025 | Asset Type | Level I | Level II | Level III | Uncategorized | Total | | :------------------------------------------ | :------ | :------- | :-------- | :------------ | :---- | | Common and preferred stock | $107.1 | — | — | — | $107.1 | | Corporate bonds | — | $62.6 | — | — | $62.6 | | Derivatives | $0.1 | $0.7 | — | — | $0.8 | | Investments related to long-term incentive compensation plans | $35.9 | — | — | — | $35.9 | | Investments in unconsolidated Funds | — | — | — | $19.3 | $19.3 | | **Total fair value assets** | **$143.1** | **$63.3** | **—** | **$19.3** | **$225.7** | Fair Value Liabilities (in millions) as of June 30, 2025 | Liability Type | Level I | Level II | Level III | Uncategorized | Total | | :-------------------- | :------ | :------- | :-------- | :------------ | :---- | | Securities sold short | $(25.7) | — | — | — | $(25.7) | | Derivatives | — | $(0.3) | — | — | $(0.3) | | **Total fair value liabilities** | **$(25.7)** | **$(0.3)** | **—** | **—** | **$(26.0)** | - Level I assets primarily include actively traded common and preferred stock and investments related to long-term incentive compensation plans. Level II assets include corporate bonds and derivatives valued using observable inputs[37](index=37&type=chunk)[41](index=41&type=chunk)[47](index=47&type=chunk) - Investments in unconsolidated Funds, primarily real estate investment funds, are valued using NAV as a practical expedient and are uncategorized within the fair value hierarchy[47](index=47&type=chunk) [5) Variable Interest Entities](index=16&type=section&id=5)%20Variable%20Interest%20Entities) This note discusses the company's involvement with and consolidation of Variable Interest Entities - The Company sponsors various Variable Interest Entities (VIEs), primarily Funds managed by Acadian LLC, and consolidates those where it is the primary beneficiary, typically when its ownership interest is substantial[49](index=49&type=chunk)[50](index=50&type=chunk) Consolidated VIEs Assets and Liabilities (in millions) | Item | June 30, 2025 | December 31, 2024 | | :-------------------------- | :------------ | :---------------- | | Investments | $170.5 | $154.0 | | Other assets | $10.3 | $5.3 | | Total Assets | $180.8 | $159.3 | | Liabilities | $27.1 | $21.2 | | Total Liabilities | $27.1 | $21.2 | - The Company's maximum exposure to loss from unconsolidated VIEs was **$19.3 million** at June 30, 2025, representing the carrying value of its investments in these entities[55](index=55&type=chunk) [6) Leases](index=17&type=section&id=6)%20Leases) This note provides information on the company's operating lease arrangements and related expenses Operating Lease Expenses (in millions) | Item | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :-------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Total operating lease expense | $2.3 | $2.2 | $4.5 | $4.4 | | Operating cash flows from operating leases | $2.5 | $2.1 | $4.9 | $4.5 | - The weighted average remaining lease term was **8.0 years** at June 30, 2025, with a weighted average discount rate of **3.54%**[56](index=56&type=chunk) Maturities of Operating Lease Liabilities (in millions) | Year Ending December 31, | Amount | | :----------------------- | :----- | | 2025 (excluding 6 months ended June 30, 2025) | $4.7 | | 2026 | $9.5 | | 2027 | $9.1 | | 2028 | $8.7 | | 2029 | $8.0 | | Thereafter | $33.2 | | Total lease payments | $73.2 | | Less imputed interest | $(9.4) | | Total | $63.8 | [7) Borrowings and Debt](index=18&type=section&id=7)%20Borrowings%20and%20Debt) This note details the company's outstanding borrowings and long-term debt obligations Borrowings and Long-Term Debt (in millions) | Item | June 30, 2025 (Carrying Value) | December 31, 2024 (Carrying Value) | | :------------------------------------ | :----------------------------- | :------------------------------- | | Revolving credit facility | $20.0 | — | | $275 million 4.80% Senior Notes Due 2026 | $274.5 | $274.3 | | Total | $294.5 | $274.3 | - Acadian LLC's **$125 million** revolving credit facility was replaced with a new **$140 million** facility on August 29, 2024, maturing on August 29, 2027[61](index=61&type=chunk)[63](index=63&type=chunk) - The new revolving credit facility bears variable interest rates based on prime rate, federal funds effective rate, or Adjusted Term SOFR, plus additional amounts based on Acadian LLC's Leverage Ratio[64](index=64&type=chunk) [8) Commitments and Contingencies](index=19&type=section&id=8)%20Commitments%20and%20Contingencies) This note outlines the company's various commitments and potential contingent liabilities - The Company's subsidiaries are required to maintain minimum financial or capital requirements, with no known violations during the reported periods[66](index=66&type=chunk) - A guaranty for an office space security deposit of **$2.5 million** expires in 2033, with no related liabilities recorded[67](index=67&type=chunk) - Management does not believe any outstanding litigation or foreign tax contingencies will have a material adverse effect on the Company[68](index=68&type=chunk)[71](index=71&type=chunk) [9) Earnings Per Share](index=21&type=section&id=9)%20Earnings%20Per%20Share) This note presents the calculation of basic and diluted earnings per share for controlling interests Earnings Per Share (in millions, except per share data) | Item | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :---------------------------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Net income attributable to controlling interests | $10.1 | $11.0 | $30.2 | $25.6 | | Weighted-average shares outstanding—basic | 35,912,023 | 37,547,741 | 36,633,243 | 38,305,631 | | Weighted-average shares outstanding—diluted | 35,929,662 | 38,238,620 | 36,651,092 | 38,985,030 | | Basic EPS attributable to controlling interests | $0.28 | $0.29 | $0.82 | $0.67 | | Diluted EPS attributable to controlling interests | $0.28 | $0.29 | $0.82 | $0.66 | - Basic and diluted EPS for the three months ended June 30, 2025, decreased slightly to **$0.28** from **$0.29** in the prior year, while for the six months, they increased to **$0.82** from **$0.67** and **$0.66**, respectively[76](index=76&type=chunk) [10) Revenue](index=21&type=section&id=10)%20Revenue) This note disaggregates the company's revenue streams, including management and performance fees Revenue Breakdown (in millions) | Revenue Type | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | YoY Change (3M) | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | YoY Change (6M) | | :-------------------- | :--------------------------- | :--------------------------- | :-------------- | :--------------------------- | :--------------------------- | :-------------- | | Management fees | $122.3 | $105.5 | +15.9% | $235.2 | $207.7 | +13.2% | | Performance fees | $2.6 | $2.8 | -7.1% | $7.9 | $5.9 | +33.9% | | Consolidated Funds' revenue | $2.5 | $0.7 | +257.1% | $4.2 | $1.1 | +281.8% | | Total revenue | $127.4 | $109.0 | +16.9% | $247.3 | $214.7 | +15.2% | Management Fee Revenue by Client Domicile (in millions) | Client Location | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :-------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | U.S. | $92.9 | $79.5 | $178.8 | $156.8 | | Non-U.S. | $29.4 | $26.0 | $56.4 | $50.9 | | Total | $122.3 | $105.5 | $235.2 | $207.7 | - **Performance fees** decreased by **$(0.2) million** (**7.1%**) for the three months ended June 30, 2025, but increased by **$2.0 million** (**33.9%**) for the six months ended June 30, 2025, reflecting varied performance relative to benchmarks[10](index=10&type=chunk)[138](index=138&type=chunk)[139](index=139&type=chunk) [11) Accumulated Other Comprehensive Income (Loss)](index=22&type=section&id=11)%20Accumulated%20Other%20Comprehensive%20Income%20(Loss)) This note details the components of accumulated other comprehensive income or loss Accumulated Other Comprehensive Income (Loss) (in millions) | Item | Balance as of March 31, 2025 | Other Comprehensive Income (3M) | Balance as of June 30, 2025 | | :------------------------------------------ | :--------------------------- | :------------------------------ | :-------------------------- | | Foreign currency translation adjustment | $3.2 | $0.4 | $3.6 | | Amortization of derivative securities | $(6.4) | $0.7 | $(5.7) | | Total | $(3.2) | $1.1 | $(2.1) | | Item | Balance as of December 31, 2024 | Other Comprehensive Income (6M) | Balance as of June 30, 2025 | | :------------------------------------------ | :---------------------------- | :------------------------------ | :-------------------------- | | Foreign currency translation adjustment | $2.7 | $0.9 | $3.6 | | Amortization of derivative securities | $(7.1) | $1.4 | $(5.7) | | Total | $(4.4) | $2.3 | $(2.1) | - **Accumulated other comprehensive loss** improved from **$(4.4) million** at December 31, 2024, to **$(2.1) million** at June 30, 2025, driven by positive foreign currency translation adjustments and amortization related to derivative securities[83](index=83&type=chunk) [12) Derivatives and Hedging](index=23&type=section&id=12)%20Derivatives%20and%20Hedging) This note describes the company's derivative instruments and hedging activities - The Company previously entered into **$300.0 million** notional Treasury rate lock contracts, designated as cash flow hedges, which were settled in July 2016[84](index=84&type=chunk) - As of June 30, 2025, a balance of **$(5.7) million** (net of tax) related to these hedges is recorded in **accumulated other comprehensive income (loss)** and is expected to be reclassified to interest expense over the life of the issued debt[85](index=85&type=chunk) - The Company reclassified **$0.9 million** and **$0.8 million** to earnings for the three months ended June 30, 2025 and 2024, respectively, and expects to reclassify approximately **$4.1 million** to interest expense in the next twelve months[85](index=85&type=chunk) [13) Segment Information](index=24&type=section&id=13)%20Segment%20Information) This note provides financial information for the company's reportable operating segment, Quant & Solutions - The Company operates through one reportable segment, '**Quant & Solutions**,' which focuses on systematic investment strategies using advanced technology to identify mispriced assets[87](index=87&type=chunk) - **Economic Net Income (ENI)** is the primary measure used by the Chief Operating Decision Maker (CODM) to evaluate performance, allocate resources, and determine compensation, as it reflects underlying economic earnings by excluding non-cash or non-recurring items[88](index=88&type=chunk)[110](index=110&type=chunk)[111](index=111&type=chunk) Quant & Solutions Segment Economic Net Income (in millions) | Item | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :-------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Segment ENI revenue | $124.9 | $108.3 | $243.1 | $213.6 | | Segment ENI expenses | $85.6 | $76.6 | $168.9 | $150.5 | | Segment economic net income | $39.3 | $31.7 | $74.2 | $63.1 | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=27&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's analysis of the company's financial condition, operational results, liquidity, and future outlook, including U.S. GAAP and non-GAAP performance measures [Overview](index=28&type=section&id=Overview) This section provides a general description of Acadian's business model, profitability drivers, and key performance metrics - **Acadian** operates a systematic investment management business through Acadian LLC, focusing on **Quant & Solutions** strategies for institutional investors globally[102](index=102&type=chunk) - Profitability is driven by **AUM** levels, fee rates, and expense structure, with **management fees** based on average **AUM** and **performance fees** earned when investment performance exceeds benchmarks[104](index=104&type=chunk) - The company uses a profit-sharing model with key employees, aligning economic interests through variable compensation and equity/profit interest distributions, which are key components of **compensation and benefits expense**[106](index=106&type=chunk)[107](index=107&type=chunk) - **Economic Net Income (ENI)**, a non-GAAP measure, is used by management to evaluate financial performance, make operational decisions, and manage capital, as it excludes non-cash or non-recurring items and reclassifies certain income statement items[110](index=110&type=chunk)[111](index=111&type=chunk) [Summary Results of Operations](index=30&type=section&id=Summary%20Results%20of%20Operations) This section presents a high-level summary of the company's financial performance, including key U.S. GAAP and non-GAAP metrics Summary Results of Operations (in millions, unless otherwise noted) | Item | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :-------------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | U.S. GAAP Revenue | $127.4 | $109.0 | $247.3 | $214.7 | | U.S. GAAP Net income attributable to controlling interests | $10.1 | $11.0 | $30.2 | $25.6 | | U.S. GAAP Operating margin | 12.7% | 18.9% | 19.5% | 20.3% | | ENI revenue | $124.9 | $108.3 | $243.1 | $213.6 | | Economic net income | $22.9 | $17.2 | $43.2 | $34.6 | | Adjusted EBITDA | $39.1 | $32.0 | $74.3 | $63.9 | | ENI operating margin | 30.7% | 27.1% | 29.6% | 27.4% | | AUM at period end (in billions) | $151.1 | $112.6 | $151.1 | $112.6 | | Net client cash flows (in billions) | $13.8 | $0.0 | $17.6 | $0.4 | - **AUM** increased by **$38.5 billion** (**34.2%**) to **$151.1 billion** at June 30, 2025, compared to **$112.6 billion** at June 30, 2024, driven by market appreciation and positive **net client cash flows**[116](index=116&type=chunk)[118](index=118&type=chunk)[126](index=126&type=chunk) - **Net client cash flows** were **$13.8 billion** for the three months ended June 30, 2025, a significant increase from **$0.0 billion** in the prior year, and **$17.6 billion** for the six months, up from **$0.4 billion**[116](index=116&type=chunk)[128](index=128&type=chunk) [Assets Under Management](index=31&type=section&id=Assets%20Under%20Management) This section details the company's Assets Under Management (AUM) by strategy, client type, and geographic location, along with AUM flows Assets Under Management by Strategy (in billions) | Strategy | June 30, 2025 (AUM) | % of Total | December 31, 2024 (AUM) | % of Total | | :-------------------- | :------------------ | :--------- | :-------------------- | :--------- | | Non-U.S. Equity | $32.4 | 21.4% | $26.6 | 22.7% | | Small Cap Equity | $29.4 | 19.5% | $25.0 | 21.3% | | Enhanced Equity | $27.5 | 18.2% | $10.8 | 9.2% | | Global Equity | $22.2 | 14.7% | $19.0 | 16.2% | | Emerging Markets Equity | $21.7 | 14.4% | $18.1 | 15.4% | | Other | $17.9 | 11.8% | $17.8 | 15.2% | | **Total AUM** | **$151.1** | | **$117.3** | | Assets Under Management by Client Type (in billions) | Client Type | June 30, 2025 (AUM) | % of Total | December 31, 2024 (AUM) | % of Total | | :------------ | :------------------ | :--------- | :-------------------- | :--------- | | Institutional | $121.9 | 80.7% | $93.0 | 79.3% | | Sub-Advisory | $16.0 | 10.6% | $13.1 | 11.2% | | Wealth/Other | $13.2 | 8.7% | $11.2 | 9.5% | | **Total AUM** | **$151.1** | | **$117.3** | | Assets Under Management by Client Location (in billions) | Client Location | June 30, 2025 (AUM) | % of Total | December 31, 2024 (AUM) | % of Total | | :-------------- | :------------------ | :--------- | :-------------------- | :--------- | | U.S. | $86.9 | 57.5% | $74.7 | 63.7% | | EMEA | $32.8 | 21.7% | $16.9 | 14.4% | | Asia Pacific | $23.9 | 15.8% | $18.8 | 16.0% | | Other | $7.5 | 5.0% | $6.9 | 5.9% | | **Total AUM** | **$151.1** | | **$117.3** | | AUM Flows (in billions) | Item | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :-------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Beginning balance | $121.9 | $110.4 | $117.3 | $103.7 | | Gross inflows | $18.7 | $8.3 | $27.5 | $12.6 | | Gross outflows | $(5.7) | $(9.1) | $(11.5) | $(13.8) | | Net flows | $13.8 | $0.0 | $17.6 | $0.4 | | Market appreciation | $15.4 | $2.2 | $16.2 | $8.5 | | Ending balance | $151.1 | $112.6 | $151.1 | $112.6 | [U.S. GAAP Results of Operations for the Three and Six Months Ended June 30, 2025 and 2024](index=35&type=section&id=U.S.%20GAAP%20Results%20of%20Operations%20for%20the%20Three%20and%20Six%20Months%20Ended%20June%2030%2C%202025%20and%202024) This section provides a detailed analysis of the company's financial performance based on U.S. GAAP for the specified periods U.S. GAAP Statement of Operations (in millions) | Item | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | Change | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | Change | | :-------------------------------------- | :--------------------------- | :--------------------------- | :----- | :--------------------------- | :--------------------------- | :----- | | Management fees | $122.3 | $105.5 | +$16.8 | $235.2 | $207.7 | +$27.5 | | Performance fees | $2.6 | $2.8 | -$(0.2) | $7.9 | $5.9 | +$2.0 | | Total revenue | $127.4 | $109.0 | +$18.4 | $247.3 | $214.7 | +$32.6 | | Compensation and benefits | $83.8 | $62.2 | +$21.6 | $144.6 | $120.3 | +$24.3 | | General and administrative expense | $21.8 | $21.1 | +$0.7 | $44.1 | $41.1 | +$3.0 | | Total operating expenses | $111.2 | $88.4 | +$22.8 | $199.2 | $171.2 | +$28.0 | | Operating income | $16.2 | $20.6 | -$(4.4) | $48.1 | $43.5 | +$4.6 | | Net consolidated Funds' investment gains | $12.1 | $0.8 | +$11.3 | $15.7 | $2.5 | +$13.2 | | Income before taxes | $23.6 | $17.1 | +$6.5 | $55.7 | $38.9 | +$16.8 | | Net income attributable to controlling interests | $10.1 | $11.0 | -$(0.9) | $30.2 | $25.6 | +$4.6 | - Average basis points earned on **AUM** decreased to **37.0 bps** for Q2 2025 (from **38.5 bps** in Q2 2024) and **37.3 bps** for H1 2025 (from **38.3 bps** in H1 2024), due to changes in the mix of **AUM**[133](index=133&type=chunk) - **Compensation and benefits expense** increased by **$21.6 million** (**34.7%**) for Q2 2025 and **$24.3 million** (**20.2%**) for H1 2025, driven by higher variable compensation, sales-based compensation, and Acadian LLC key employee distributions, as well as revaluations of key employee equity[147](index=147&type=chunk)[148](index=148&type=chunk) Key U.S. GAAP Operating Metrics | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :------------------------------------------ | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | U.S. GAAP operating margin | 12.7% | 18.9% | 19.5% | 20.3% | | U.S. GAAP operating expense / management fee revenue | 89.8% | 83.7% | 83.8% | 82.3% | | U.S. GAAP variable compensation ratio | 62.3% | 55.8% | 53.8% | 53.7% | | U.S. GAAP Acadian LLC key employee distributions ratio | 20.9% | 9.5% | 13.4% | 9.2% | [Non-GAAP Supplemental Performance Measure — Economic Net Income and Segment Analysis](index=43&type=section&id=Non-GAAP%20Supplemental%20Performance%20Measure%20%E2%80%94%20Economic%20Net%20Income%20and%20Segment%20Analysis) This section reconciles U.S. GAAP net income to Economic Net Income (ENI) and analyzes segment performance using this non-GAAP measure - **ENI** is a non-GAAP measure used by management to evaluate financial performance, make operational decisions, and manage capital, differing from U.S. GAAP by reclassifying and excluding certain non-cash or non-recurring items[172](index=172&type=chunk) Reconciliation of U.S. GAAP Net Income to Economic Net Income (in millions) | Item | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :---------------------------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | U.S. GAAP net income attributable to controlling interests | $10.1 | $11.0 | $30.2 | $25.6 | | Non-cash key employee-owned equity and profit interest revaluations | $19.7 | $5.9 | $19.4 | $10.3 | | Seed/Co-investment (gains) losses and financings | $(2.6) | $(0.2) | $(2.6) | $(1.4) | | Economic net income | $22.9 | $17.2 | $43.2 | $34.6 | Key Non-GAAP Operating Metrics | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :------------------------------------------ | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | ENI operating margin | 30.7% | 27.1% | 29.6% | 27.4% | | ENI operating expense ratio | 44.6% | 48.8% | 46.3% | 48.6% | | ENI variable compensation ratio | 45.4% | 48.2% | 46.4% | 48.0% | | ENI Acadian LLC key employee distributions ratio | 10.4% | 7.1% | 9.9% | 7.3% | - The **Quant & Solutions segment's ENI** revenue increased by **15.3%** to **$124.9 million** for Q2 2025 and **13.8%** to **$243.1 million** for H1 2025, driven by higher **management fees** from increased **AUM**[200](index=200&type=chunk)[201](index=201&type=chunk) - Segment **ENI** expenses increased by **11.7%** to **$85.6 million** for Q2 2025 and **12.2%** to **$168.9 million** for H1 2025, primarily due to higher variable compensation and general and administrative expenses[203](index=203&type=chunk)[204](index=204&type=chunk) [Capital Resources and Liquidity](index=56&type=section&id=Capital%20Resources%20and%20Liquidity) This section discusses the company's financial resources, cash flows, and ability to meet its short-term and long-term obligations Cash Flows (excluding consolidated Funds, in millions) | Activity | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :-------------------- | :--------------------------- | :--------------------------- | | Operating activities | $10.7 | $5.4 | | Investing activities | $9.1 | $(18.8) | | Financing activities | $(24.8) | $(61.7) | - **Net cash from operating activities** (excluding consolidated Funds) increased by **$5.3 million** to **$10.7 million** for H1 2025[208](index=208&type=chunk) Adjusted EBITDA Reconciliation (in millions) | Item | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :---------------------------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Net income attributable to controlling interests | $10.1 | $11.0 | $30.2 | $25.6 | | EBITDA | $23.3 | $26.0 | $59.6 | $55.0 | | Adjusted EBITDA | $39.1 | $32.0 | $74.3 | $63.9 | - The Company believes its available cash, cash equivalents, and future operations, supplemented by financing, will be sufficient to fund operations and capital requirements for at least the next twelve months[213](index=213&type=chunk) Other Compensation Liabilities (in millions) | Liability Type | June 30, 2025 | December 31, 2024 | | :-------------------------- | :------------ | :---------------- | | Share-based payments liability | $30.2 | $25.4 | | Profit interests liability | $33.9 | $18.7 | | Voluntary deferral plan liability | $35.6 | $48.4 | | Total | $99.7 | $92.5 | Accrued Incentive Compensation (in millions) | Period | Amount | | :-------------------------- | :----- | | June 30, 2025 | $66.0 | | December 31, 2024 | $119.6 | [Critical Accounting Policies and Estimates](index=59&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) This section highlights the accounting policies and estimates that require significant judgment and can materially impact financial results - There have been no significant changes to the critical accounting policies and estimates disclosed in the Company's most recent Form 10-K for the year ended December 31, 2024[223](index=223&type=chunk) [Forward Looking Statements](index=60&type=section&id=Forward%20Looking%20Statements) This section provides cautionary statements regarding the inherent uncertainties and risks associated with forward-looking information - The report contains forward-looking statements regarding anticipated revenues, margins, cash flows, future performance, and market conditions, which are subject to known and unknown risks and uncertainties[225](index=225&type=chunk) - Actual results may differ materially from these statements due to various factors, and readers are cautioned not to place undue reliance on them[226](index=226&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=61&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section details the company's exposure to market risks, including AUM, equity markets, and foreign currency, and analyzes their potential impact on revenues and profitability - The Company's revenue is directly tied to **AUM** and investment performance, making it susceptible to market depreciation and client withdrawals[228](index=228&type=chunk) - Approximately **39%** of the Company's **Economic Net Income (ENI)** cost structure is variable, linking variable compensation and Acadian LLC key employee distributions to profitability, thereby sharing market risk with employees[230](index=230&type=chunk) Market Risk Sensitivity Analysis (as of June 30, 2025, in millions) | Scenario | Impact on Annualized Gross Management Fee Revenue | Impact on Annual Post-Tax ENI | | :---------------------------------------------------- | :------------------------------------------ | :---------------------------- | | 10% increase/decrease in total AUM ($151.1B) | ±$56 | ±$24 | | 10% increase/decrease in equity markets-based AUM ($151B) | ±$55 | ±$22 (plus ±$2 from performance fees) | | 10% increase/decrease in foreign currency denominated AUM ($108B) | ±$45 | ±$18 (plus ±$2 from performance fees) | - The Company does not hedge market risks at the corporate level or within individual strategies, and changes in **AUM** composition could negatively impact overall weighted average fee rates[233](index=233&type=chunk)[234](index=234&type=chunk) - Interest rate risk exposure is primarily from variable-rate borrowings under the revolving credit facility; a hypothetical **10%** change in interest rates would have an immaterial impact on interest expense[235](index=235&type=chunk) [Item 4. Controls and Procedures](index=63&type=section&id=Item%204.%20Controls%20and%20Procedures) This section confirms the effectiveness of disclosure controls and procedures and reports no material changes in internal control over financial reporting - Management, including the principal executive and financial officers, concluded that **disclosure controls and procedures** were effective as of June 30, 2025[237](index=237&type=chunk) - There have been no material changes in **internal control over financial reporting** during the quarter ended June 30, 2025[238](index=238&type=chunk) [PART II — OTHER INFORMATION](index=64&type=section&id=Part%20II%20%E2%80%94%20Other%20Information) This section provides additional information not covered in the financial statements, including legal proceedings, risk factors, and equity sales [Item 1. Legal Proceedings](index=64&type=section&id=Item%201.%20Legal%20Proceedings) This section addresses the company's involvement in legal proceedings and assesses their potential financial impact - The Company is involved in ordinary course legal proceedings but does not believe they will result in material liabilities to its consolidated financial condition, future results of operations, or cash flow[240](index=240&type=chunk) [Item 1A. Risk Factors](index=64&type=section&id=Item%201A.%20Risk%20Factors) This section confirms no material changes to the risk factors previously disclosed in the company's latest annual report - No material changes have occurred in the risk factors described in the Company's Annual Report on Form 10-K for the year ended December 31, 2024[241](index=241&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=64&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section details the company's common stock repurchase activities and the remaining authorization under its programs Equity Securities Purchases (3 Months Ended June 30, 2025) | Period | Total Shares Purchased | Average Price Paid Per Share | Total Shares Purchased as Part of Publicly Announced Plans | Approximate Dollar Value Remaining Under Plans (in millions) | | :---------------- | :--------------------- | :--------------------------- | :------------------------------------------------------- | :--------------------------------------------------------- | | April 1-30, 2025 | 925,741 | $25.48 | 925,741 | $37.0 | | May 1-31, 2025 | — | — | — | $37.0 | | June 1-30, 2025 | — | — | — | $37.0 | | **Total** | **925,741** | **$25.48** | **925,741** | | - The Board of Directors authorized the repurchase of up to **$80 million** of common stock on February 6, 2025, with no expiration. **$23.6 million** was used to repurchase **0.9 million** shares during the three months ended June 30, 2025[242](index=242&type=chunk) [Item 5. Other Information](index=64&type=section&id=Item%205.%20Other%20Information) This section confirms no changes in Rule 10b5-1 or non-Rule 10b5-1 trading arrangements by directors or officers - No directors or officers changed their **Rule 10b5-1 trading arrangements** or **non-Rule 10b5-1 trading arrangements** during the quarter ended June 30, 2025[243](index=243&type=chunk) [Item 6. Exhibits](index=65&type=section&id=Item%206.%20Exhibits) This section lists all exhibits accompanying the Form 10-Q filing, including corporate governance documents and certifications - The exhibits include corporate governance documents (Amended and Restated Certificate of Incorporation, Bylaws), certifications from the CEO and CFO (Sarbanes-Oxley Act Sections 302 and 906), and interactive data files (XBRL) for the financial statements[244](index=244&type=chunk)

Contact: Investor Relations ir@acadian-inc.com (617) 369-7300 // ACADIAN ASSET MANAGEMENT INC Exhibit 99.1 Kelly Young, Acadian Asset Management Inc.'s President and Chief Executive Officer, said, "Acadian achieved a significant milestone in the second guarter of 2025, with a record $13.8 billion of net client cash flows, and $151.1 billion of AUM as of June 30, 2025, the highest in the firm's nearly 40 year history. Our continued organic growth reflects strength and momentum in the business driven by outpe ...

Financial Performance - Total revenue for Q1 2025 was $119.9 million, an increase of 13.4% from $105.7 million in Q1 2024[114] - Pre-tax income attributable to controlling interests rose to $28.4 million in Q1 2025, up from $20.7 million in Q1 2024, reflecting a growth of 37.2%[114] - Economic net income (ENI) for Q1 2025 was $20.3 million, compared to $17.4 million in Q1 2024, representing a 16.6% increase[114] - The diluted earnings per share (EPS) increased to $0.54 in Q1 2025, up from $0.44 in Q1 2024, a rise of 22.7%[114] - The company reported a net income of $23.8 million for the three months ended March 31, 2025, an increase of $8.1 million or 51.6% from $15.7 million in 2024[124] Assets Under Management (AUM) - Assets under management (AUM) reached $121.9 billion as of March 31, 2025, up from $110.4 billion a year earlier, marking an increase of 10.8%[114] - Total assets under management (AUM) increased to $121.9 billion as of March 31, 2025, up $4.6 billion or 3.9% from $117.3 billion at December 31, 2024[121] - The U.S. client segment accounted for 63.2% of total AUM, with $77.0 billion as of March 31, 2025, compared to 63.7% with $74.7 billion at December 31, 2024[121] - Institutional client AUM rose to $96.3 billion, up from $93.0 billion, with net flows of $3.1 billion for the three months ended March 31, 2025[120] - The average AUM for the three months ended March 31, 2025, was $120.7 billion, compared to $107.6 billion in 2024, indicating a growth of 12.9%[119] Revenue Streams - ENI revenue for Q1 2025 was $118.2 million, a 12.2% increase from $105.3 million in Q1 2024[114] - Management fees for the three months ended March 31, 2025, were $112.9 million, an increase of $10.7 million or 10.5% compared to $102.2 million in 2024[124] - Performance fees increased to $5.3 million for the three months ended March 31, 2025, up from $3.1 million in 2024, marking a growth of 70.9%[124] - Management fee revenue for Q1 2025 was $112.9 million, up from $102.2 million in Q1 2024, representing a growth of 10.9%[163] - Performance fees increased by 71.0% due to strong performance relative to the market in certain strategies during the three months ended March 31, 2025[184] Operating Efficiency - The U.S. GAAP operating margin improved to 26.6% in Q1 2025, up from 21.7% in Q1 2024, an increase of 494 basis points[114] - The ENI operating margin for Q1 2025 was 28.3%, slightly up from 27.7% in Q1 2024, an increase of 61 basis points[114] - The operating margin improved to 26.6% for the three months ended March 31, 2025, compared to 21.7% in 2024, reflecting enhanced operational efficiency[125] - The U.S. GAAP operating margin, excluding the effect of consolidated Funds, was 26.1% for Q1 2025, compared to 21.5% for Q1 2024[173] Expenses - Total U.S. GAAP compensation and benefits expense increased by $2.7 million, or 4.6%, from $58.1 million in Q1 2024 to $60.8 million in Q1 2025, with variable compensation rising by $3.8 million, or 14.4%[138] - General and administrative expenses increased by $2.3 million, or 11.5%, from $20.0 million in Q1 2024 to $22.3 million in Q1 2025, primarily due to higher systems and outside services costs[140] - ENI operating expenses were $54.3 million in Q1 2025, an increase from $49.5 million in Q1 2024, which is a 9.7% increase[166] - Quant & Solutions segment ENI expenses increased by $9.4 million, or 12.7%, from $73.9 million in Q1 2024 to $83.3 million in Q1 2025[186] Cash Flow and Financial Ratios - Net cash used in operating activities decreased by $9.4 million, from $(39.3) million in Q1 2024 to $(48.7) million in Q1 2025[190] - Net cash from investing activities changed by $13.2 million, from $(1.4) million in Q1 2024 to $11.8 million in Q1 2025[190] - Net cash from financing activities increased by $65.3 million, from $(3.7) million in Q1 2024 to $61.6 million in Q1 2025[190] - As of March 31, 2025, the company had $119.6 million in cash and cash equivalents and $91.5 million in seed capital investments[196] - The Leverage Ratio was 0.4x and the Interest Coverage Ratio was 109.7x as of March 31, 2025[200] Market Risks - The company does not hedge against interest rate risk, and as of March 31, 2025, there were no borrowings under the revolving credit facility[217] - The company has not adopted a corporate-level risk management policy regarding client assets, exposing it to market risks affecting overall AUM value[216] - Market risks include equity market risk, interest rate risk, and foreign currency risk, which could significantly impact management and performance fees[214] - Changes in the composition of AUM towards lower fee rate strategies could negatively impact the overall weighted average fee rate[215]

Financial Performance - Acadian reported positive net cash flow (NCCF) of $3.8 billion in Q1 2025, the strongest quarter in nineteen years, reflecting a significant increase of 850% compared to the previous year[34]. - Economic net income (ENI) for Q1 2025 was $20.3 million, a 17% increase from $17.4 million in Q1 2024, with ENI earnings per share rising 23% to $0.54[4][7]. - U.S. GAAP net income attributable to controlling interests was $20.1 million, a 38% increase from $14.6 million in Q1 2024, with diluted EPS rising 46% to $0.54[7][34]. - Total revenue increased by 13.4% to $119.9 million in Q1'25, driven by higher management fees and performance fees[85]. - Management fees rose by 10% to $112.9 million, reflecting a 12% increase in average AUM due to market appreciation and positive net cash flow[95]. - Performance fees surged by 71% to $5.3 million in Q1'25 compared to Q1'24[94]. - Net income attributable to controlling interests increased by 37.7% to $20.1 million in Q1'25[86]. - Diluted earnings per share rose by 45.9% to $0.54 in Q1'25[86]. - Consolidated revenue increased from $105.7 million in Q1'24 to $119.9 million in Q1'25, representing a growth of 13.5%[129]. - Economic net income (ENI) for the Quant & Solutions Segment rose from $31.4 million in Q1'24 to $34.9 million in Q1'25, an increase of 11.1%[129]. - Income before income taxes grew from $21.8 million in Q1'24 to $32.1 million in Q1'25, marking a significant increase of 47.0%[129]. Assets and Management - Total assets under management (AUM) reached $121.9 billion as of March 31, 2025, marking a 10% increase from $110.4 billion a year earlier[32][34]. - Assets under management (AUM) increased from $110.4 billion in Q1'24 to $121.9 billion in Q1'25, reflecting a net flow of $3.8 billion[112]. - Enhanced Equity strategies, a key product initiative, saw AUM double to approximately $12 billion year-over-year, targeting the $16 trillion global passive equity market[59]. Shareholder Returns - Acadian repurchased 0.8 million shares of common stock for a total of $19.4 million in Q1 2025, resulting in a 2.0% reduction in total shares outstanding since the end of 2024[6][7]. - The Board of Directors declared a quarterly interim dividend of $0.01 per share, payable on June 27, 2025[8]. - The company returned $1.4 billion in excess capital to stockholders over the last five years through share buybacks and dividends[78]. Operational Efficiency - The operating margin improved to 27% in Q1'25, up from 22% in Q1'24, reflecting enhanced operational efficiency[86]. - Earnings after variable compensation for Q1'25 increased to $33.5 million, a 15% rise from Q1'24[107]. - Fixed compensation and benefits expenses rose from $21.6 million in Q1'24 to $22.9 million in Q1'25, an increase of 6.0%[129]. - Variable compensation expenses increased from $26.0 million in Q1'24 to $29.4 million in Q1'25, reflecting a rise of 13.1%[129]. - Unallocated corporate expenses remained relatively stable, decreasing slightly from $4.6 million in Q1'24 to $4.5 million in Q1'25[129]. Debt and Leverage - The leverage ratio stood at 2.0x, with a net leverage ratio of 1.3x[72]. - The leverage ratio increased from 1.5x in Q1'24 to 2.0x in Q1'25, indicating a rise in debt relative to earnings[110]. Tax and Expenses - The company reported an income tax expense of $6.1 million in Q1'24, which increased to $8.3 million in Q1'25, a rise of 36.1%[129]. - Interest income slightly decreased from $1.3 million in Q1'24 to $1.1 million in Q1'25, a decline of 15.4%[129]. - Net consolidated funds' investment gains increased from $1.7 million in Q1'24 to $3.6 million in Q1'25, representing a growth of 111.8%[129]. Other Financial Metrics - The company maintained a cash balance of approximately $120 million and an outstanding balance of $80 million on its revolving credit facility as of March 31, 2025[6]. - Total assets decreased from $703.2 million in December 2024 to $677.3 million in March 2025[110]. - Total liabilities also decreased from $616.1 million to $584.8 million during the same period[110]. - Adjusted EBITDA increased from $31.9 million in Q1'24 to $35.2 million in Q1'25[116]. - The ENI management fee rate remained stable at 38% for both Q1'24 and Q1'25[112]. - The Acadian LLC key employee distribution ratio rose to 9.3% in Q1'25, an increase of 172 basis points from Q1'24[107].

Assets Under Management (AUM) - Acadian LLC manages approximately $117 billion in assets under management (AUM) as of December 31, 2024[20]. - The institutional channel accounts for over 80% of Acadian LLC's AUM, with public/government pension market representing 43% and corporate plan market 13%[26]. - As of December 31, 2024, Acadian LLC manages $52 billion in assets, with 45% concentrated in three investment strategies: Acadian Global Equity ($19 billion, 16%), Acadian Emerging Markets Equity ($18 billion, 16%), and Acadian All-Country World ex-US Equity ($15 billion, 13%)[61]. - Approximately 80% of assets under management are in non-U.S. denominated currencies, exposing the company to foreign currency exchange risks[62]. - Total assets under management (AUM) increased to $117.3 billion as of December 31, 2024, representing a growth of $13.6 billion or 13.1% compared to $103.7 billion in 2023[186]. - Developed Markets AUM reached $91.0 billion, up from $80.7 billion in 2023, while Developing Markets AUM increased to $26.3 billion from $23.0 billion[186]. - Institutional client AUM rose to $97.9 billion in 2024, with gross inflows of $17.9 billion and net flows of $4.3 billion[184]. - Average AUM for 2024 was $112.3 billion, compared to $98.4 billion in 2023[182]. Financial Performance - Revenue for the year ended December 31, 2024, was $505.6 million, an increase of 18.5% from $426.6 million in 2023[178]. - Economic Net Income (ENI) revenue for 2024 was $502.5 million, up 18.6% from $423.6 million in 2023[178]. - Pre-tax economic net income for 2024 was $146.2 million, representing a 41.3% increase from $103.4 million in 2023[178]. - ENI diluted earnings per share (EPS) for 2024 was $2.76, an increase of 55.1% from $1.78 in 2023[178]. - Net client cash flows for 2024 were $1.8 billion, a turnaround from a net outflow of $2.3 billion in 2023[178]. - The U.S. GAAP operating margin for 2024 was 27%, an increase of 195 basis points from 25% in 2023[178]. - Adjusted EBITDA for 2024 was $177.1 million, up 32.4% from $133.8 million in 2023[178]. - Economic net income for 2024 was $105.8 million, a 39.7% increase from $75.7 million in 2023[178]. Client Relationships - Acadian LLC's client base is diverse, with the top five client relationships representing approximately 13% of total run rate gross management fee revenue[29]. - The top five client relationships account for approximately 13% of total run rate gross management fee revenue, while the top 25 clients represent about 35%[73]. Investment Strategies and Performance - The firm has over 120 investment and research professionals, focusing on systematic investment strategies across more than 65,000 securities[21]. - The company has a strong track record of investment performance, with competitive near- and long-term results[34]. - Investment performance relative to benchmarks is crucial for attracting and retaining client assets, with poor performance potentially leading to significant outflows[58]. - A significant portion of revenue is derived from a limited number of investment strategies, making the company vulnerable to performance fluctuations in these areas[61]. Operational and Regulatory Risks - The company operates in a highly regulated environment, with compliance requirements that can change and impact business operations[113]. - The integrity of the company's brand and reputation is critical, with potential harm from operational failures or regulatory issues leading to loss of clients and revenue[68]. - The company faces risks related to conflicts of interest, which could arise from overlapping investment objectives among client accounts[69]. - The company is subject to evolving data protection laws, with potential fines of up to 4% of total annual worldwide turnover for non-compliance[101]. - The company must comply with various anti-corruption laws, including the U.S. Foreign Corrupt Practices Act and the U.K. Bribery Act, with non-compliance potentially leading to significant penalties[104]. - The company is subject to the California Consumer Privacy Act (CCPA), which imposes civil penalties for violations and increases operational costs due to compliance requirements[102]. Technology and Innovation - The firm utilizes advanced technological capabilities to support its systematic investment process, enhancing operational efficiency[50]. - The company is increasingly reliant on technology, including machine learning and artificial intelligence, to maintain competitiveness in the investment management sector[110]. Employee and Compensation - As of December 31, 2024, Acadian LLC had 383 full-time equivalent employees, with no employees represented by collective bargaining agreements[49]. - Compensation and benefits expense increased by $47.6 million, or 21.8%, from $217.9 million in 2023 to $265.5 million in 2024[200]. - Fixed compensation and benefits rose by $4.7 million, or 5.0%, from $93.1 million in 2023 to $97.8 million in 2024, mainly due to new hires and cost of living increases[204]. - Variable compensation increased by $10.5 million, or 9.4%, from $112.2 million in 2023 to $122.7 million in 2024, driven by higher pre-bonus profits[204]. Market and Economic Conditions - The competitive nature of the asset management industry has led to a trend toward lower fees, impacting revenue and net income[79]. - A shift in the mix of assets under management from higher-fee to lower-fee products may decrease revenues even if total assets under management increase[80]. - The market price of the company's common stock has been volatile, influenced by economic conditions, competitive position, and financial results[130]. Shareholder Dynamics - Paulson & Co. Inc. owns 23.9% of the company's common stock, which may influence business decisions and affect stockholder dynamics[118]. - Future sales of common stock by major shareholders could lead to a decline in share price and complicate capital-raising efforts[120].

Financial Performance - Acadian reported record ENI earnings per share of $1.30 for Q4 2024, a 69% increase compared to $0.77 in Q4 2023[6]. - Economic net income (ENI) for Q4 2024 was $49.0 million, up 50% from $32.6 million in Q4 2023[6]. - U.S. GAAP earnings per share for Q4 2024 were $1.13, representing a 109% increase from $0.54 in Q4 2023[6]. - Acadian's adjusted EBITDA for Q4 2024 was $72.8 million, a 41% increase compared to $51.5 million in Q4 2023[22]. - Total revenue for Q4 2024 was $167.8 million, a 27.9% increase from Q4 2023, driven by a 51.8% rise in performance fees[92]. - Q4 2024 ENI EPS increased by 69% year-over-year, reaching $1.13, while FY 2024 ENI EPS rose by 55% to $2.25[91]. - Operating income surged by 82.6% to $65 million in Q4 2024, with an operating margin of 39%[92]. - The company reported a positive net consolidated funds' investment gain of $3.9 million for FY 2024, compared to a loss in the previous year[92]. - Earnings after variable compensation rose to $68 million in Q4'24 compared to $46.6 million in Q4'23, reflecting a significant increase in performance fee revenue[108]. Assets Under Management - Acadian's assets under management (AUM) reached $117.3 billion as of December 31, 2024, reflecting a 13% increase from the previous year[26]. - Assets Under Management (AUM) increased to $117.3 billion in Q4'24 from $103.7 billion in Q4'23, with net flows of $0.9 billion compared to a net outflow of $2.0 billion in Q4'23[113]. - Acadian's gross sales for the full year 2024 totaled $21 billion across various strategies, demonstrating strong sales performance[4]. - Management fees increased by 18% year-over-year, totaling $111.3 million in Q4 2024, supported by a 20% rise in average market appreciation[99]. Growth Initiatives - The company plans to allocate excess capital to support organic growth and return capital to shareholders, with a cash balance of approximately $95 million[5]. - The company initiated management of external assets in its Credit strategy during Q4 2024, indicating ongoing growth initiatives[4]. - The company is targeting the $3 trillion active corporate credit space with new systematic credit strategies launched in Q4 2023[71]. - Acadian's new Enhanced Equity and Equity Extensions strategies aim to provide higher returns with lower drawdown risks, appealing to institutional clients[66]. Expenses and Compensation - Total operating expenses increased by 7.5% to $102.8 million in Q4 2024, primarily due to higher compensation and benefits[92]. - ENI operating expenses increased to $57.0 million in Q4'24 from $52.7 million in Q4'23, with the Operating Expense Ratio falling to 51.2% from 55.8%[103]. - Variable compensation increased to $39 million in Q4'24 from $30.5 million in Q4'23, with the Variable Compensation Ratio decreasing to 35.7% from 39.0%[105]. - The full-year Operating Expense Ratio for 2025 is expected to be approximately 47%-49% if AUM remains stable[103]. - The full-year Variable Compensation Ratio for 2025 is projected to be between 44%-48%[106]. - The Acadian LLC Key Employee Distribution Ratio increased to 3.0% in Q4'24 from 2.5% in Q4'23, reflecting changes in profit sharing[109]. Historical Context - The company incurred $8.6 million in restructuring costs during Q4'23[122]. - U.S. GAAP pre-tax income for Q4'23 was $34.9 million, with a pre-tax ENI of $44.4 million after adjustments[122]. - Consolidated revenue for Q4'23 was $131.2 million, with segment ENI revenue from Quant & Solutions at $131.0 million[125]. - Segment ENI for Quant & Solutions was $50.6 million, with total expenses amounting to $80.4 million[125]. - Consolidated net income attributable to controlling interests was $22.8 million for Q4'23[125]. - Interest income for Q4'23 was $1.8 million, while interest expense was $4.5 million[125]. - The leverage ratio as of December 31, 2023, was 2.0x, with a net leverage ratio of 0.9x[110]. - Total assets as of December 31, 2023, were $611.4 million, with total liabilities at $561.9 million, resulting in shareholders' equity of $49.5 million[110].

Group 1 - The Zacks Rank emphasizes earnings estimates and revisions to identify strong stocks, while also considering value, growth, and momentum trends [1] - The Style Scores system helps investors find stocks with specific traits, particularly in the "Value" category for value investors [2] - BrightSphere Investment Group (BSIG) has a P/S ratio of 2.13, which is lower than the industry average of 3.32, indicating potential undervaluation [3] Group 2 - BSIG is rated 2 (Buy) by Zacks and has an A for Value, with a P/E ratio of 9.34 compared to the industry average of 18.17 [6] - The company's Forward P/E has fluctuated between 8.84 and 12.17 over the past year, with a median of 10.39 [6] - BSIG's P/CF ratio is 12.15, significantly lower than the industry's average of 36.68, suggesting it may be undervalued based on cash flow [7]

Group 1: Momentum Investing Overview - Momentum investing involves following a stock's recent trend, with the aim of buying high and selling higher, capitalizing on established price movements [1] - The Zacks Momentum Style Score helps define momentum characteristics, with BrightSphere Investment Group (BSIG) currently holding a Momentum Style Score of B [2][3] Group 2: BrightSphere Investment Group Performance - BSIG has a Zacks Rank of 1 (Strong Buy), indicating strong potential for outperformance in the market [3] - Over the past week, BSIG shares increased by 0.68%, matching the performance of the Zacks Financial - Investment Management industry [6] - In the last quarter, BSIG shares rose by 32.36%, and over the past year, they increased by 72.54%, significantly outperforming the S&P 500's gains of 9.71% and 33.24% respectively [7] Group 3: Trading Volume and Earnings Outlook - BSIG's average 20-day trading volume is 213,760 shares, which is a useful indicator of market interest and price movement [8] - In the past two months, one earnings estimate for BSIG increased, raising the consensus estimate from $2.31 to $2.59, with no downward revisions [10] - Given these factors, BSIG is positioned as a strong buy with a Momentum Score of B, making it a notable pick for potential near-term gains [11]

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