[Westwood Holdings Group, Inc. First Quarter 2025 Earnings Release](index=1&type=section&id=Westwood%20Holdings%20Group%2C%20Inc.%20Reports%20First%20Quarter%202025%20Results) [Financial & Operational Highlights](index=1&type=section&id=Financial%20%26%20Operational%20Highlights) The firm reported strong Q1 2025 sales, including a major institutional mandate, and expanded its ETF platform - Firmwide assets under management and advisement totaled **$18.0 billion** as of Q1 2025, comprising $17.0 billion in AUM and $1.0 billion in AUA[3](index=3&type=chunk) - Strategic and operational achievements in Q1 2025 include a significant sub-advisory mandate of nearly **$1 billion** in the Institutional channel, the best Intermediary channel sales quarter since 2022, and the launch of a new global equity ETF[1](index=1&type=chunk)[2](index=2&type=chunk) Key Financial Metrics | Financial Metric | Q1 2025 | Q4 2024 | Q1 2024 | | :--- | :--- | :--- | :--- | | **Revenues** | $23.3M | $25.6M | $22.7M | | **Net Income** | $0.5M | $2.1M | $2.3M | | **Diluted EPS** | $0.05 | $0.24 | $0.27 | | **Non-GAAP Economic Earnings** | $2.5M | $3.4M | $3.0M | | **Non-GAAP Economic EPS** | $0.29 | $0.39 | $0.36 | - The company declared a cash dividend of **$0.15 per common share**, payable on July 1, 2025[4](index=4&type=chunk) - As of March 31, 2025, the company held **$26.9 million** in cash and liquid investments with no debt, and stockholders' equity totaled **$119.3 million**[4](index=4&type=chunk) [Condensed Consolidated Statements of Operations](index=4&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS) Q1 2025 revenues grew year-over-year but fell sequentially due to a lack of performance-based fees Statement of Operations Highlights (in thousands) | (in thousands) | Q1 2025 | Q4 2024 | Q1 2024 | | :--- | :--- | :--- | :--- | | **Total Revenues** | **$23,252** | **$25,582** | **$22,732** | | Asset-based Fees | $17,731 | $18,025 | $16,817 | | Performance-based Fees | $0 | $1,875 | $0 | | Trust Fees | $5,429 | $6,117 | $5,113 | | **Total Expenses** | **$23,320** | **$23,021** | **$19,791** | | Employee Compensation | $14,501 | $14,090 | $14,711 | | (Gain) on Contingent Consideration | $0 | $1,199 | $(2,949) | | **Net Income** | **$477** | **$2,099** | **$2,166** | | **Diluted EPS** | **$0.05** | **$0.24** | **$0.27** | - Revenues decreased quarter-over-quarter primarily due to **zero performance-based fees** in Q1 2025, compared to $1.9 million in such fees in Q4 2024[14](index=14&type=chunk) - The significant variance in net income compared to Q1 2024 is largely attributable to a **$2.9 million non-cash gain** from contingent consideration recorded in the prior-year period[14](index=14&type=chunk) [Condensed Consolidated Balance Sheets](index=5&type=section&id=CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) Total assets and liabilities decreased significantly due to contingent consideration and compensation payments Balance Sheet Highlights (in thousands) | (in thousands) | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$134,988** | **$149,989** | | Cash and cash equivalents | $9,418 | $18,847 | | Investments, at fair value | $19,696 | $27,694 | | **Total Liabilities** | **$13,602** | **$27,657** | | Compensation and benefits payable | $2,416 | $10,924 | | Contingent consideration | $0 | $4,657 | | **Total Equity** | **$121,386** | **$122,332** | - Cash and cash equivalents decreased by **$9.4 million** during the quarter, from $18.8 million to $9.4 million[15](index=15&type=chunk) - A significant reduction in liabilities was driven by the full payment of contingent consideration (**$4.7 million**) and a decrease in compensation and benefits payable[15](index=15&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS) The company experienced a net cash outflow driven by operating activities, primarily compensation payments Statement of Cash Flows Highlights (in thousands) | (in thousands) | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | **Net cash (used in) provided by operating activities** | **$(4,900)** | **$8,133** | | **Net cash used in investing activities** | **$(1,418)** | **$(3)** | | **Net cash used in financing activities** | **$(3,111)** | **$(2,664)** | | **Net Change in Cash** | **$(9,429)** | **$5,466** | | **Cash, end of period** | **$9,418** | **$25,888** | - The significant cash outflow from operating activities was driven by an **$8.5 million** payment for compensation and benefits and a **$4.4 million** payment for contingent consideration[16](index=16&type=chunk) - Cash used in financing activities included **$1.6 million** for cash dividends and **$1.3 million** for restricted stock returned for tax payments[16](index=16&type=chunk) [Reconciliation of GAAP to Non-GAAP Measures](index=7&type=section&id=Reconciliation%20of%20Income%20Attributable%20to%20Westwood%20Holdings%20Group%2C%20Inc.%20to%20Economic%20Earnings) Non-GAAP Economic Earnings are reconciled from GAAP Net Income by adjusting for non-cash and tax-related items - Economic Earnings are defined as GAAP net income adjusted for non-cash equity-based compensation, amortization of intangible assets, and related deferred taxes[17](index=17&type=chunk)[18](index=18&type=chunk) Reconciliation of GAAP Net Income to Economic Earnings (in thousands) | Reconciliation (in thousands) | Q1 2025 | Q4 2024 | Q1 2024 | | :--- | :--- | :--- | :--- | | **GAAP Net Income** | **$478** | **$2,056** | **$2,296** | | Stock-based compensation | $1,327 | $1,216 | $1,515 | | Intangible amortization | $1,045 | $1,063 | $1,042 | | Other tax adjustments | $(336) | $(958) | $(1,841) | | **Economic Earnings** | **$2,514** | **$3,377** | **$3,012** | | **Economic EPS** | **$0.29** | **$0.39** | **$0.36** |

Core Insights - Westwood Holdings Group, Inc. reported strong performance in Q1 2025, with significant achievements in both Institutional and Intermediary channels, including a nearly $1 billion sub-advisory mandate in Small Cap Value strategy and the best sales quarter since 2022 in the Intermediary channel [2][3] - The company launched the LBRTY Global Equity ETF and celebrated the one-year anniversary of the MDST ETF, which has an annualized distribution rate of 10.5% [1][2] - Firmwide assets under management (AUM) totaled $18.0 billion, comprising $17.0 billion in AUM and $1.0 billion in assets under advisement (AUA) [3] Financial Performance - Quarterly revenues were $23.3 million, down from $25.6 million in the previous quarter but up from $22.7 million a year ago [7] - Net income for Q1 2025 was $0.5 million, a decrease from $2.1 million in Q4 2024 and $2.3 million in Q1 2024 [4][5] - Diluted earnings per share (EPS) were $0.05 compared to $0.24 in Q4 2024 and $0.27 in Q1 2024 [4][5] Economic Earnings - Non-GAAP Economic Earnings for Q1 2025 were $2.5 million, or $0.29 per share, compared to $3.4 million, or $0.39 per share in Q4 2024, and $3.0 million, or $0.36 per share in Q1 2024 [4][5][7] - The company declared a cash dividend of $0.15 per common share, payable on July 1, 2025 [7] Balance Sheet and Cash Flow - As of March 31, 2025, total assets were $134.988 million, down from $149.989 million at the end of Q4 2024 [14] - Cash and cash equivalents decreased to $9.418 million from $18.847 million in the previous quarter [15] - Stockholders' equity totaled $119.3 million, with no debt reported [7][14]

Core Viewpoint - Westwood Holdings Group celebrates the one-year anniversary of the Westwood Salient Enhanced Energy Income ETF (WEEI), which has achieved an annualized distribution rate of 11.9% as of March 28, 2025, indicating strong investor demand for income-focused investment solutions [1][2][3]. Company Overview - Westwood Holdings Group (NYSE: WHG) is a boutique asset management firm that provides a range of actively-managed investment strategies and wealth services to various clients, emphasizing a client-first approach and innovative investment solutions [7][8]. Fund Performance - WEEI has delivered a year-to-date net asset value (NAV) performance of 8.63% and a market price performance of 8.86% since its inception on April 30, 2024, with an expense ratio of 0.85% [4]. - The fund's structure aims to provide tax efficiency, transparency, and accessibility, aligning with Westwood's commitment to investor-focused strategies [3]. Investment Strategy - WEEI employs a covered-call strategy to enhance income, allowing investors to benefit from the cash flow generation of energy companies while also gaining additional yield through options premiums [2][3]. - The fund targets the energy sector, contrasting with its sister ETF, the Westwood Salient Enhanced Midstream Income ETF (MDST), which focuses on the midstream segment [2][3]. Market Position - WEEI has resonated with advisors and investors seeking reliable income solutions in a dynamic market environment, reflecting strong demand for income-generating investment options [2][3]. - The fund's performance and strategy have positioned it as a valuable tool for income-focused investors across various market cycles [3].

Company Overview - Westwood Holdings Group, Inc. is a focused investment management boutique and wealth management firm, founded in 1983 [3] - The company offers a broad array of investment solutions to institutional investors, private wealth clients, and financial intermediaries [3] - Westwood specializes in distinct investment capabilities including U.S. Value Equity, Multi-Asset, Energy & Real Assets, Income Alternatives, Tactical Absolute Return, and Managed Investment Solutions [3] - The firm operates through separate accounts, the Westwood Funds® family of mutual funds, exchange-traded funds (ETFs), and other pooled vehicles [3] - Westwood is publicly traded on the New York Stock Exchange under the symbol "WHG" and has significant employee ownership [3] Upcoming Earnings Release - Westwood Holdings Group, Inc. will release its first quarter 2025 earnings after the close of the New York Stock Exchange on April 30, 2025 [1] - Following the earnings release, the company will host a live audio webcast and conference call at 4:30 PM Eastern Time [1][2] - Registration is required to join the conference call and view the webcast, with unique identifiers provided upon registration [2]

Core Insights - Westwood Holdings Group celebrates the one-year anniversary of the Westwood Salient Enhanced Midstream Income ETF (MDST), which has gained significant traction among income-seeking investors, nearing $100 million in assets under management [1][2][3] - The ETF aims to provide exposure to the midstream energy sector through a covered-call strategy, allowing investors to benefit from the stability and cash flow of midstream infrastructure companies while enhancing yield through options premiums [2][3] - The fund has achieved an annualized distribution rate of 10.5% as of March 28, 2025, and has shown strong performance with a net asset value (NAV) increase of 22.95% since inception [1][4] Company Overview - Westwood Holdings Group is a boutique asset management firm that offers a range of actively-managed investment strategies and wealth services to various clients, emphasizing a client-first approach [7][8] - The firm has expanded its ETF platform to five funds within a year, indicating a commitment to innovative, outcome-driven investments [4] Fund Performance - As of March 31, 2025, MDST reported a quarter-to-date performance of 5.71% and a market price increase of 5.36% [4] - The fund's expense ratio stands at 0.80%, and it offers a subsidized/unsubsidized 30-day yield of 3.69% [4] Investment Strategy - MDST is designed for income investors, focusing on generating reliable income through a combination of dividend income and options premiums, which helps mitigate volatility [3][4] - The fund's structure provides tax transparency and accessibility, aligning with Westwood's innovative investment strategies [3]

Core Insights - Westwood Holdings Group has launched the Westwood LBRTY Global Equity ETF (BFRE) aimed at reducing risks associated with authoritarian regimes while ensuring broad market diversification [1][2][3] Investment Strategy - BFRE employs TOBAM's LBRTY methodology to systematically minimize exposure to companies affected by the unpredictable behavior of autocratic governments, aligning with investors focused on risk management [2][6] - The ETF's strategy helps mitigate geopolitical risks and market volatility linked to authoritarian countries, while maintaining alignment with global market benchmarks [3][6] Methodology - BFRE synthesizes multi-dimensional datasets to assess global democracy, reducing exposure to authoritarian countries like China and Russia through a two-level approach: excluding stocks from non-democratic nations and prioritizing companies in democratic countries [4][7] - This methodology offers a more comprehensive assessment than traditional exclusion-based strategies, focusing on both country and stock levels [4][6] Market Coverage - The ETF is designed to provide extensive market coverage, including both developed and emerging markets, simplifying investment allocation and offering a dynamic investment option [5][6] Investor Demand - There is a growing demand among investors for solutions that address the interconnected nature of global economies, with BFRE aiming to minimize exposure to authoritarian regimes while aligning with investor goals [6][7]

Core Insights - Westwood Holdings Group has appointed J. Hale Hoak and Katherine Murray to its Board of Directors, enhancing its governance and expertise in finance and investment management [1][2] - The appointments align with Westwood's commitment to inclusivity and community engagement, aiming to incorporate diverse perspectives rooted in local knowledge [1][2] Summary of Appointees - Hale Hoak brings over 25 years of investment experience, having served as President of Hoak & Co. since 2004 and previously as a founding partner of Inwood Capital Partners [3][4] - Katherine Murray has over 33 years of experience in finance, particularly in the energy sector, and has held senior roles in public accounting and financial consulting [5][6] Company Overview - Westwood Holdings Group is a boutique asset management firm that offers a range of actively managed investment strategies and wealth services to various client segments [7] - The firm emphasizes a client-first approach, fostering long-term relationships through tailored investment strategies and exceptional service [7][8]

Assets Under Management and Financial Performance - Westwood Management and Westwood Trust collectively had AUM of approximately $16.6 billion and AUA of approximately $1.0 billion as of December 31, 2024[15]. - As of December 31, 2024, assets under management (AUM) in the Westwood Funds® totaled $3.9 billion[48]. - A hypothetical 10% decrease in average Assets Under Management (AUM) and Assets Under Administration (AUA) during the year ended December 31, 2024, would have reduced reported consolidated total revenue by approximately $9 million[260]. - The company’s revenues are primarily generated from fees derived as a percentage of AUM and AUA, which are subject to market risks[259]. Acquisitions and Growth Strategy - The company acquired the asset management business of Salient Partners, L.P. in 2022, which included Salient Capital, L.P. and Salient Advisors, L.P.[18]. - In January 2023, Westwood acquired an additional 32% interest in Broadmark, increasing its ownership to approximately 80%[19]. - Westwood's growth strategy includes organic growth, acquisitions, and the addition of new products to diversify AUM and revenue sources[44]. - The company is pursuing strategic corporate development opportunities, including potential acquisitions of asset management firms and hiring investment professionals[70]. Investment Strategies and Products - Westwood's investment strategies include five strategies each having AUM exceeding $1 billion, such as LargeCap Value and Income Opportunity[27]. - Westwood launched its first two actively-managed ETFs in 2024: Westwood Salient Enhanced Midstream Income (MDST) and Westwood Salient Enhanced Energy Income (WEEI)[73]. - In 2024, Westwood launched two ETFs: Westwood Salient Enhanced Midstream Income ETF (MDST) and Westwood Salient Enhanced Energy Income ETF (WEEI)[45]. - Westwood's investment strategies include a focus on energy secondaries private investment funds, targeting discounts to net asset value ranging from 20% to 40%[73]. Client Relationships and Wealth Management - The company emphasizes building strong relationships with clients to enhance its ability to meet their investment objectives[16]. - Westwood Trust serves high net worth and ultra-high net worth individuals and families, with a focus on holistic wealth management approaches[67]. - The company anticipates continued interest from clients in its wealth management services, driven by referrals and existing client relationships[67]. Employee and Workforce Diversity - The company has approximately 151 full-time employees as of December 31, 2024, with 41% being female and 32% representing minority communities[87][104]. - As of December 31, 2024, approximately 15% of employees hold the Chartered Financial Analyst designation, indicating a skilled workforce[88]. Regulatory Compliance and Risk Management - The company is subject to extensive regulation by the SEC and other regulatory bodies, ensuring compliance with the Investment Advisers Act and the Investment Company Act[78]. - The company does not currently participate in any hedging activities or utilize derivative financial instruments, exposing it to inherent market risks[259]. - The company’s fiduciary duty to clients imposes standards and requirements on trading, allocation of investment opportunities, and execution of transactions[79]. Financial Health and Dividend Payments - The company has made quarterly and special dividend payments to Westwood Holdings Group, Inc. out of undivided profits, reflecting its financial health[83]. - The company’s cash equivalents and other investment instruments are exposed to financial market risk due to fluctuations in interest rates, but significant impacts on interest income are not expected[261]. Marketing and Brand Development - The firm aims to strengthen its brand name through high-profile coverage in investment publications and creative marketing strategies[71]. - The company has expanded its distribution capabilities through the Salient Acquisition and the addition of a Managed Investment Solutions team, enhancing its product range[64]. Sales and Market Engagement - Westwood's proactive sales efforts have increased throughout 2024, focusing on consultants and institutional plan sponsors[69]. - The Managed Investment Solutions team joined Westwood in late 2023, focusing on tailoring investment solutions for diverse institutional clients[42]. - The company continues to evaluate new strategies and resources to meet actual and potential investor needs[17].

Core Points - Cumulus Media's Westwood One will broadcast a total of 19 NCAA Men's and Women's Basketball games during Conference Championship Week from March 8 to March 16, 2025 [1][2][3] Group 1: Broadcast Schedule - The postseason basketball coverage begins on March 8 with the Ohio Valley Conference Championship game and continues through Selection Sunday on March 16 [2] - Key games include the Big East, CAA, Conference USA, Patriot League, MVC, Big South, SoCon, America East, and WCC for men's championships, and Big East and Ivy League for women's championships [3][4] - Selection Sunday will reveal the 68-team field for both men's and women's tournaments, hosted by Jason Horowitz with analysts PJ Carlesimo and Debbie Antonelli [2][4] Group 2: Westwood One Sports Overview - Westwood One Sports is the exclusive network radio partner to the NFL since 1987 and covers NCAA Basketball, including the NCAA Men's and Women's Tournaments and the Final Four [5] - The network also broadcasts other major sports events, including The Masters and U.S. Soccer Federation matches [5] Group 3: Cumulus Media Overview - Cumulus Media is an audio-first media company reaching a quarter billion people monthly through 400 radio stations across 85 markets [7] - The company provides a range of programming, including sports, news, talk, and entertainment, and operates the Cumulus Podcast Network [7] - Cumulus Media offers advertisers local and national advertising performance guarantees through various platforms [7]

Financial Data and Key Metrics Changes - Total revenues for Q4 2024 were $25.6 million, up from $23.7 million in Q3 2024 and $23.2 million in Q4 2023, driven by higher average assets under management and performance fees [32] - Comprehensive income for Q4 2024 was $2.1 million, or $0.24 per share, compared to $0.1 million, or $0.01 per share in Q3 2024, and a net loss of $2.6 million, or $0.32 per share in Q4 2023 [33] - Economic earnings for Q4 2024 were $3.4 million, or $0.39 per share, compared to $1.1 million, or $0.13 per share in Q3 2024, and $2.8 million, or $0.34 per share in Q4 2023 [33] Business Line Data and Key Metrics Changes - The institutional team won and funded eight mandates totaling over $600 million in 2024, a 100% increase from the previous year [7] - The Westwood Salient Enhanced Midstream Income ETF reached $73 million in assets by year-end, exceeding first-year targets [17] - Wealth management experienced an uptick in net flows during Q4 2024, continuing into December [17] Market Data and Key Metrics Changes - Firmwide assets under management totaled $17.6 billion at quarter-end, with $16.6 billion in assets under management and $1 billion in assets under advisement [34] - Assets under management included institutional assets of $8.3 billion (50%), wealth management assets of $4.4 billion (26%), and mutual fund assets of $3.9 billion (24%) [35] - The company experienced net outflows of $0.8 billion in assets under management and $211 million in assets under advisement, offset by market appreciation of $1.9 billion and $92 million respectively [35] Company Strategy and Development Direction - The company is focused on strengthening core infrastructure while pursuing strategic growth, including the launch of new ETFs and managed investment solutions [19][26] - The acquisition of Salient Partners' asset management business continues to exceed expectations, enhancing capabilities in energy and real estate income strategies [23][25] - A partnership with ETF veteran Ben Fulton aims to scale Westwood's ETF platform, offering innovative strategies [26][28] Management's Comments on Operating Environment and Future Outlook - Management expressed a cautiously optimistic outlook, citing benign credit conditions and attractive equity valuations [14] - The company noted that as the post-COVID bull market matures, investors may shift focus towards quality companies, which aligns with the company's investment style [15] - The energy sector is viewed as presenting attractive opportunities, with strong fundamentals supporting positive outlooks for energy strategies [24] Other Important Information - The board approved a regular cash dividend of $0.15 per common share, payable on April 1, 2025 [36] - The company was recognized as a Pensions and Investments Best Places to Work in Money Management for the 10th year [29] Q&A Session Summary - No specific questions or answers were documented in the provided content, thus no summary can be provided for this section.