Financial Highlights - Total client assets reached $1714 billion[7] - Long-term gross flows amounted to $93 billion with net flows of -$12 billion[7] - ETF gross flows were $31 billion and net flows were $28 billion[7] - Adjusted EBITDA stood at $1164 million with a margin of 530%[7] - Cash and cash equivalents totaled $176 million[7] - The quarterly cash dividend increased by 4% to $049 per share[7] Strategic Partnership with Amundi - Total assets under the partnership are projected to be $286 billion[9] - Projected net expense synergies are estimated at $110 million[9] Investment Performance - 67% of total mutual funds and ETFs AUM have 4- or 5-Star overall ratings[14] - 79% of strategies outperformed benchmarks over the 10-year period[15] Q1 2025 Financial Results - Revenue was $2196 million[18] - GAAP Operating Income was $929 million with a margin of 423%[18] - Adjusted Net Income with tax benefit was $881 million or $136 per diluted share[18]

Financial Performance - First-quarter revenue was $219.6 million, a 1.7% increase year-over-year from $215.9 million, but a decrease of $12.8 million from the previous quarter[20] - GAAP net income for the first quarter was $62.0 million, down 19.5% from $76.9 million in the fourth quarter, translating to earnings of $0.96 per diluted share[18] - Adjusted EBITDA for the first quarter was $116.4 million, a decrease of 7.1% from $125.5 million in the fourth quarter, with an adjusted EBITDA margin of 53.0%[19] - Total revenue for Q1 2025 was $219.602 million, a decrease of 5.4% from $232.371 million in Q4 2024 and an increase of 1.1% from $215.857 million in Q1 2024[33] - Net income for Q1 2025 was $61.975 million, down 19.5% from $76.939 million in Q4 2024 and up 11.5% from $55.691 million in Q1 2024[33] - Adjusted EBITDA for Q1 2025 was $116.399 million, with an adjusted EBITDA margin of 53.0%[35] - The company reported a basic earnings per share of $0.97 for Q1 2025, compared to $1.19 in Q4 2024 and $0.86 in Q1 2024[33] Client Assets and Flows - Total client assets reached $171.4 billion, with assets under management (AUM) at $167.5 billion, reflecting a decrease of $4.5 billion from $171.9 billion at December 31, 2024[15] - Total client assets at the end of Q1 2025 were $171.435 million, a decrease from $176.096 million at the end of Q4 2024 and an increase from $175.459 million at the end of Q1 2024[41] - Ending assets under management (AUM) for Q1 2025 were $167.468 million, down from $171.930 million in Q4 2024 and up from $170.342 million in Q1 2024[41] - The company experienced a net cash outflow of $1.526 million in total client assets for Q1 2025, compared to $2.545 million in Q4 2024[41] - Long-term gross flows for the first quarter totaled $9.3 billion, while long-term net flows were negative at ($1.2) billion[10] - Total gross flows for the first quarter were $9.5 billion, indicating strong client engagement despite net outflows[15] - Gross client cash inflows for the three months ended March 31, 2025, were $9,486 million, an increase from $6,793 million in the previous quarter[45] - Gross client cash outflows increased to $10,736 million for the three months ended March 31, 2025, compared to $8,663 million in the previous quarter[45] - Net client cash flows for the three months ended March 31, 2025, were negative at $(1,249) million, improving from $(1,870) million in the previous quarter[45] Market Performance - Investment performance remained strong, with 64%, 65%, and 79% of AUM outperforming benchmarks over the 3-, 5-, and 10-year periods, respectively[7] - Market depreciation for the quarter was $(3.172) billion, compared to $(2.237) billion in the previous quarter, representing a decline of about 42%[53] - Market appreciation for other assets (institutional) was $78 million for the three months ended March 31, 2025, recovering from a depreciation of $(141) million in the previous quarter[47] Dividends and Shareholder Returns - The Board declared a record quarterly cash dividend of $0.49 per share, payable on June 25, 2025[10] Company Transactions and Strategic Moves - The company successfully closed a transaction with Amundi on April 1, enhancing its scale and diversification across asset classes and geographies[6] Assets and Liabilities - Total assets as of March 31, 2025, were $2.583 billion, an increase from $2.548 billion at the end of Q4 2024[37] - Victory Capital's total liabilities were $1.439 billion as of March 31, 2025, compared to $1.426 billion at the end of Q4 2024[37] - Other institutional assets decreased to $3,967 million as of March 31, 2025, from $4,165 million as of December 31, 2024[47] - The company experienced a net cash outflow of $(10.736) billion for the quarter, compared to $(8.663) billion in the previous quarter, indicating a worsening liquidity position[53] Adjusted Metrics - Adjusted EBITDA and Adjusted Net Income are used to measure operating profitability, excluding one-time acquisition and restructuring costs[55] - The tax benefit from amortization of acquired intangible assets and goodwill is significant, providing additional economic benefits to the company[56] - The company added back various expenses, including income tax, interest on debt, and stock-based compensation, to calculate Adjusted EBITDA[57]

Core Viewpoint - Analysts expect Victory Capital Holdings (VCTR) to report quarterly earnings of $1.38 per share, reflecting a year-over-year increase of 10.4%, with revenues projected at $226.09 million, up 4.7% from the previous year [1]. Earnings Projections - Over the last 30 days, there has been a downward revision of 1.3% in the consensus EPS estimate for the quarter, indicating a collective reconsideration by analysts of their initial forecasts [2]. - Changes in earnings projections are crucial for predicting investor reactions, as empirical studies show a strong correlation between earnings estimate trends and short-term stock price movements [3]. Revenue and Key Metrics - Analysts forecast 'Revenue- Fund administration and distribution fees' at $48.19 million, a year-over-year increase of 4.6% [5]. - The average prediction for 'Revenue- Investment management fees' is $178.26 million, indicating a 5% increase from the prior-year quarter [5]. - 'Ending Assets Under Management' is expected to reach $197.22 billion, up from $170.34 billion in the same quarter last year [5]. Specific Asset Management Estimates - 'Ending assets under management - Global/Non-U.S. Equity' is projected at $18.33 billion, slightly up from $18.20 billion a year ago [6]. - 'Ending assets under management - Solutions' is expected to be $63.38 billion, compared to $57.83 billion last year [6]. - 'Ending assets under management - U.S. Large Cap Equity' is estimated at $13.10 billion, down from $13.90 billion a year ago [7]. - 'Ending assets under management - U.S. Mid Cap Equity' is projected at $28.96 billion, down from $32.92 billion last year [7]. - 'Ending assets under management - U.S. Small Cap Equity' is expected to be $13.18 billion, down from $16.30 billion [8]. - 'Ending assets under management - Alternative Investments' is projected at $2.95 billion, down from $3.47 billion [8]. - 'Ending assets under management - Money Market/Short-term' is estimated at $3.40 billion, up from $3.25 billion last year [9]. - 'Ending assets under management - Fixed Income' is expected to be $24.16 billion, slightly down from $24.48 billion a year ago [9]. Stock Performance - Shares of Victory Capital have returned +13.5% over the past month, outperforming the Zacks S&P 500 composite's +10.6% change [9].

Group 1: Victory Capital Holdings, Inc. (VCTR) Performance - VCTR reported assets under management (AUM) of $175.5 billion for February 2025, reflecting a 0.6% decline from $176.5 billion as of January 31, 2024 [1] - U.S. mid cap equity AUM decreased 2.9% to $30.4 billion, while U.S. small cap equity AUM dipped 5.3% to $14.2 billion [1] - Global/non-U.S. equity AUM rose 5.8% to $20.6 billion, and U.S. large cap equity AUM decreased 3.7% to $13.9 billion [1] Group 2: Solutions and Alternative Investments - VCTR recorded $65.5 billion in Solutions, up 0.1% from January 2025 [2] - Alternative investments asset balance declined 2.6% to $2.9 billion, while fixed-income AUM was $24.4 billion, increasing marginally [2] - Money market/short-term assets rose 1.9% to $3.4 billion [2] Group 3: Market Positioning - VCTR's integrated multi-boutique business model and effective distribution platform are expected to enhance performance in the near term [3] Group 4: Performance of Other Asset Managers - Franklin Resources, Inc. (BEN) reported preliminary AUM of $1.58 trillion as of February 28, 2025, showing a marginal decrease [4] - BEN's decline in AUM was attributed to long-term net outflows of $10 billion, despite positive market impacts [4] - AllianceBernstein Holding L.P. (AB) announced preliminary AUM of $805 billion for February 2025, reflecting a marginal decrease [5] - AB's Equity AUM declined 2.6% to $333 billion, while Fixed-Income AUM increased 1.3% to $303 billion [5]

Assets Under Management (AUM) - Total client assets increased to $176.1 billion as of December 31, 2024, up from $17.9 billion in August 2013 following the management-led buyout[318]. - Assets under management (AUM) rose by $10.6 billion, or approximately 6.6%, to $171.9 billion from $161.3 billion at December 31, 2023, primarily driven by positive market action of $18.1 billion[325]. - Total Assets Under Management (AUM) as of December 31, 2024, reached $171.93 billion, an increase from $161.32 billion in 2023, representing a growth of approximately 6.5%[338]. - Long-term AUM increased to $168.59 billion in 2024 from $158.05 billion in 2023, reflecting a year-over-year growth of about 6.5%[338]. - Fixed Income AUM slightly increased to $24.40 billion in 2024 from $24.36 billion in 2023, while U.S. Large Cap Equity AUM rose to $14.15 billion from $12.64 billion, indicating a growth of approximately 11.9%[338]. - Solutions AUM saw a significant increase to $62.59 billion in 2024, up from $54.30 billion in 2023, marking a growth of around 15.3%[338]. - The average AUM for 2024 was $169.7 billion, compared to $153.5 billion in 2023[328]. - Long-term gross inflows were $25.3 billion for the year ended December 31, 2024, compared to $22.7 billion in 2023[325]. - Total AUM increased by $10.6 billion, or 6.6%, to $171.9 billion at December 31, 2024, from $161.3 billion at December 31, 2023, driven by positive market movement of $18.1 billion, partially offset by net outflows of $7.4 billion[343]. Financial Performance - Total revenue for the year ended December 31, 2024, was $893.5 million, compared to $821.0 million for the year ended December 31, 2023[326]. - Net income increased to $288.9 million for the year ended December 31, 2024, up from $213.2 million in 2023[326]. - Adjusted EBITDA for the year ended December 31, 2024, was $475.6 million, with an adjusted EBITDA margin of 53.2%, compared to $418.0 million and 50.9% in 2023[327]. - Net income for 2024 was $288.9 million, an increase of $75.7 million, or 35.5%, compared to $213.2 million in 2023[375]. - Earnings per share (diluted) increased to $4.38 in 2024, up from $3.12 in 2023, reflecting a growth of 40.5%[375]. - Adjusted Net Income for 2024 was $312.9 million, representing a 16.0% increase from $269.7 million in 2023[409]. Cash Flows and Expenses - The Company recorded net cash provided by operating activities of $339.979 million in 2024, an increase of $9.688 million from $330.291 million in 2023[440]. - Cash used in investing activities decreased to $3.979 million in 2024 from $7.841 million in 2023, primarily due to a decrease in purchases of property and equipment[443]. - Cash used in financing activities increased by $95.6 million to $332.763 million in 2024 from $237.132 million in 2023, mainly due to payment of consideration for acquisition and repayment of long-term senior debt[444]. - Personnel compensation and benefits represent the most significant category of expense, including salaries, incentive compensation, and acquisition-related compensation[359]. - Total operating expenses decreased by $26.6 million, or 5.4%, to $466.0 million in 2024 from $492.6 million in 2023[375]. Market and Client Flows - Net client cash flows for 2024 were negative at $(1.63) billion, compared to $(0.59) billion in 2023, indicating a decline in client inflows[333]. - Market appreciation contributed $504 million to AUM in 2024, down from $690 million in 2023, reflecting a decrease of approximately 27%[333]. - The company experienced a net client cash flow decline of $(7,377) million in 2024, indicating challenges in client retention[340]. - Net outflows were primarily driven by $3.2 billion in U.S. mid cap equity strategies, $2.2 billion in U.S. small cap equity strategies, and $1.3 billion in U.S. large cap equity strategies[344]. Acquisitions and Strategic Initiatives - The company completed the acquisition of WestEnd Advisors on December 31, 2021, enhancing its ETF strategy offerings[319]. - The company also acquired New Energy Capital on November 1, 2021, focusing on clean energy infrastructure investments[320]. - The company aims to maintain a diversified client base across various asset classes and distribution channels to enhance AUM stability[334]. - The company has adjusted its asset class categorization starting January 2022, impacting the reported figures for prior periods[339]. Interest and Financing - Interest expense and other financing costs increased by $2.6 million to $63.8 million in 2024, attributed to a higher average interest rate[400]. - The company incurred $1.0 million in upfront fees and other costs related to the Fifth Amendment to the 2019 Credit Agreement, which extended the maturity date of the $100.0 million revolving facility[429]. - The Company executed a Swap to fix the interest rate at 3.215% on $450 million of its outstanding Term Loan, which was later adjusted to 3.149% after the Swap Amendment[432].

Financial Data and Key Metrics Changes - Total client assets increased to $176.1 billion, up $9.5 billion or 6% from the end of the previous year [11] - Adjusted earnings per diluted share rose more than 7% to $1.45 in the fourth quarter, a record high, and up 26% from $1.15 in the same quarter last year [11] - Adjusted EBITDA reached $126 million with a margin of 54%, both setting new quarterly records [12][27] - For the full year, revenue reached a record high of $893 million, a 9% increase from 2023 [25] Business Line Data and Key Metrics Changes - The ETF platform, Victory Shares, saw strong sales, contributing to the overall growth in assets under management (AUM) [10] - Victory income investors achieved its fourth consecutive quarter of positive net flows, indicating strong performance in the intermediary channel [31] - The average fee rate was 52.5 basis points in the fourth quarter, up four-tenths of a basis point from the third quarter [34] Market Data and Key Metrics Changes - The Amundi U.S. business reported net long-term flows of $2.6 billion in 2024, indicating strong performance across various channels [14][78] - The non-U.S. AUM is projected to exceed $45 billion post-acquisition, with a consistent record of positive net flows since Amundi's acquisition in 2017 [15][16] Company Strategy and Development Direction - The company is on track to close the acquisition of Amundi by the end of the current quarter, with expectations of realizing $100 million in cost synergies by the end of the second year [13] - The focus remains on leveraging the ETF platform and expanding distribution channels to drive organic growth [19][20] - The company is actively exploring M&A opportunities, anticipating significant consolidation in the industry [63] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the organic growth profile improving in January and highlighted strong growth in the ETF platform and institutional channels [41][43] - The integration of Amundi is expected to enhance the overall growth trajectory, with a focus on expanding product offerings in non-U.S. markets [61][80] Other Important Information - The company returned a total of $132.4 million to shareholders in the fourth quarter through share repurchases and cash dividends [22] - A new $200 million share repurchase program was authorized by the Board, alongside a 7% increase in the quarterly cash dividend [23][29] Q&A Session Summary Question: What strategies do you expect to be most in favor and contribute the most to organic growth in 2025? - Management highlighted the success of the Victory Shares ETF platform and opportunities in the institutional channel as key growth drivers [41][43] Question: What sort of revenue synergies do you expect from the Amundi deal? - Management noted a 15-year exclusive distribution agreement with Amundi, which is expected to enhance organic growth through the addition of Victory products [44][45] Question: Can you discuss margin differences across different products? - Management explained that over two-thirds of expenses are variable, allowing for significant scale and strong margins across all product lines, including ETFs [51][52] Question: How rapidly can you introduce Victory products in the non-U.S. distribution? - Management indicated that product introductions will occur throughout 2025 and into 2026, leveraging existing Amundi infrastructure [59][61] Question: What is the outlook for potential M&A this year? - Management expressed confidence in participating in industry consolidation, with a strong pipeline of discussions and opportunities [63][64] Question: How should we think about capital allocation going forward? - Management emphasized that accretive acquisitions are the primary focus, while also balancing share repurchases and dividend increases [96][98]

Financial Data and Key Metrics Changes - Total client assets increased to $176.1 billion, up $9.5 billion or 6% from the end of the previous year [6] - Adjusted earnings per diluted share rose more than 7% to $1.45 in the fourth quarter, a record high, and up 26% from $1.15 in the same quarter last year [7] - Year-over-year adjusted earnings per diluted share increased 19% from $4.51 in 2023 to $5.36 in 2024 [7] - Adjusted EBITDA reached $125.5 million in the fourth quarter, a 3% increase from the third quarter, with an adjusted EBITDA margin of 54% [18][26] Business Line Data and Key Metrics Changes - VictoryShares ETF platform saw significant growth, with AUM increasing to nearly $12 billion from less than $200 million since its acquisition in 2015 [12] - Victory Income Investors posted its fourth consecutive quarter of positive net flows, contributing to the overall positive long-term net flows in various franchises [21] - Active ETFs, particularly in fixed income, showed strong performance, with several products driving net inflows [82] Market Data and Key Metrics Changes - Amundi's U.S. business reported net long-term flows of $2.6 billion in 2024, with strong performance across its institutional and non-U.S. businesses [9][71] - The non-U.S. AUM is projected to exceed $45 billion post-acquisition, with a consistent record of positive net flows since Amundi's acquisition in 2017 [10][11] Company Strategy and Development Direction - The company is on track to close the acquisition of Amundi by the end of the current quarter, expecting to realize $100 million in cost synergies by the end of the second year of ownership [8] - The focus remains on leveraging the combined strengths of both companies to enhance growth opportunities, particularly in the institutional channel and through the VictoryShares ETF platform [30][31] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about organic growth prospects, citing a strong start to 2025 and a robust pipeline of opportunities [22][72] - The company anticipates continued growth in its ETF business, driven by market demand for active and solutions-oriented products [13][85] Other Important Information - The company returned $132.4 million to shareholders in the fourth quarter through share repurchases and cash dividends, with a new $200 million share repurchase program authorized [14][19] - A 7% increase in the quarterly cash dividend was announced, raising it to $0.47 per share [19] Q&A Session Summary Question: What strategies do you expect to be most in favor and contribute the most to organic growth in 2025? - Management highlighted the strong performance of the VictoryShares ETF platform and opportunities in the institutional channel as key growth drivers [30] Question: What sort of revenue synergies do you expect from the Amundi deal? - Management noted the establishment of a 15-year exclusive distribution agreement with Amundi, which is expected to enhance revenue through the addition of Victory products to Amundi's distribution network [32][33] Question: Can you discuss margin differences across different products? - Management explained that over two-thirds of expenses are variable, allowing for significant scale and strong margins across all product lines, including ETFs [40][41] Question: Can you provide context on the one but not yet funded pipeline? - Management indicated that the pipeline is the largest in the company's history, diversified across various franchises and channels, with expectations for most funding in 2025 [42][44] Question: How rapidly can you introduce Victory products in the Non-U.S. distribution? - Management expects to introduce products throughout 2025 and into 2026, leveraging Amundi's existing infrastructure [50][52] Question: What is the outlook for potential M&A this year? - Management expressed confidence in participating in industry consolidation, with compelling discussions ongoing and a strong balance sheet post-Amundi acquisition [55][56] Question: How should we think about capital allocation going forward? - Management emphasized the priority of accretive acquisitions while balancing share repurchases and dividends, with a focus on being opportunistic [89][92]

Fourth Quarter 2024 Earnings Presentation February 7, 2025 Forward Looking Statements This presentation may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements may include, without limitation, any statements preceded by, followed by or including words such as "target," "believe," "expect," "aim," "intend," "may," "anticipate," "assume," "budget," "continue," "estimate," "future," "objective," "outlook," "plan," "potential," "predict ...

Core Insights - Victory Capital Holdings (VCTR) reported a revenue of $232.37 million for the quarter ended December 2024, reflecting a year-over-year increase of 12.9% and surpassing the Zacks Consensus Estimate by 0.70% [1] - The earnings per share (EPS) for the quarter was $1.45, up from $1.15 in the same quarter last year, resulting in an EPS surprise of 5.84% compared to the consensus estimate of $1.37 [1] Financial Performance - Ending Assets Under Management (AUM) stood at $171.93 billion, which was below the average estimate of $173.46 billion by four analysts [4] - Total net client cash flows were reported at -$1.87 billion, worse than the average estimate of -$1.60 billion [4] - Revenue from investment management fees was $183.83 million, exceeding the average estimate of $181.05 million and representing a year-over-year increase of 14.4% [4] - Revenue from fund administration and distribution fees was $48.55 million, slightly below the average estimate of $49.69 million, but still showing a year-over-year increase of 7.6% [4] Market Performance - Victory Capital's shares returned +3.7% over the past month, outperforming the Zacks S&P 500 composite's +2.1% change [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance relative to the broader market in the near term [3]

分组1 - Victory Capital Holdings reported quarterly earnings of $1.45 per share, exceeding the Zacks Consensus Estimate of $1.37 per share, and up from $1.15 per share a year ago, representing an earnings surprise of 5.84% [1] - The company posted revenues of $232.37 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 0.70%, and an increase from $205.79 million year-over-year [2] - Over the last four quarters, Victory Capital has surpassed consensus EPS estimates three times and topped consensus revenue estimates two times [2] 分组2 - The current consensus EPS estimate for the coming quarter is $1.44 on revenues of $365.36 million, and for the current fiscal year, it is $6.19 on revenues of $1.52 billion [7] - The Zacks Industry Rank for Financial - Investment Management is currently in the bottom 28% of over 250 Zacks industries, indicating potential underperformance compared to higher-ranked industries [8] - The estimate revisions trend for Victory Capital is currently unfavorable, resulting in a Zacks Rank 4 (Sell) for the stock, suggesting expected underperformance in the near future [6]