Virtus Investment Partners(VRTS) - 2024 Q4 - Annual Results

Financial Performance - Revenues for Q4 2024 were $233.5 million, a 9% increase from$ 214.6 million in Q4 2023[2] - Operating income increased by 30% to $50.7 million compared to$ 39.0 million in the same quarter last year[2] - Net income attributable to Virtus Investment Partners was $33.3 million, up 8% from$ 30.8 million in Q4 2023[2] - Earnings per share (diluted) were $4.66, an 11% increase from$ 4.21 in Q4 2023[2] - Total revenues rose by 9% year-over-year to $233,494,000 for the three months ended December 31, 2024[22] - Operating income increased by 30% year-over-year to$ 50,721,000 for the three months ended December 31, 2024[22] - Net income attributable to Virtus Investment Partners, Inc. was $33,294,000, an 8% increase compared to the same period last year[22] - Cash dividends declared per common share increased by 18% to$ 2.25 for the three months ended December 31, 2024[22] - Total operating expenses (as adjusted) for the three months ended December 31, 2024, were $137.560 million, an increase from$ 129.524 million in the same period of 2023, reflecting a 6.3% rise[28] - Income tax expense (as adjusted) for the three months ended December 31, 2024, was $19.972 million, compared to$ 17.337 million in the same period of 2023, representing a 9.5% increase[29] Assets Under Management (AUM) - Total assets under management (AUM) were $175.0 billion, a 2% increase from$ 172.3 billion year-over-year[4] - Average total assets under management increased by 12% to $182.1 billion from$ 162.7 billion in the prior year[4] - Assets under management totaled $175,001,000,000 as of December 31, 2024, reflecting a decrease from the previous quarter[23] - Open-End Funds reported$ 56,073,000,000 in assets under management as of December 31, 2024, a slight decrease from the previous quarter[23] - Institutional accounts saw a decrease in assets under management to $59,167,000,000 as of December 31, 2024[23] - The average assets under management for total products increased to$ 182,088,000,000 for the three months ended December 31, 2024[23] - Total assets under management (AUM) increased from $162,539 million on 12/31/2023 to$ 172,259 million on 12/31/2024, reflecting a growth of approximately 5.3%[26] Net Flows - Net flows for the quarter were negative at ( $4.8) billion, compared to ($ 3.8) billion in Q4 2023, primarily due to a $3.3 billion lower-fee partial redemption[6] - Net flows for Open-End Funds showed a decline of$ 1,116 million for the three months ended 12/31/2024, compared to a decline of $1,965 million for the same period in 2023[26] - Institutional Accounts experienced net outflows of$ 3,802 million for the three months ended 12/31/2024, compared to net outflows of $2,227 million for the same period in 2023[26] - The company reported total inflows of$ 25,857 million for the twelve months ended 12/31/2024, compared to $26,757 million for the previous year[26] Operating Metrics - Operating margin improved to 21.7%, up from 18.2% in the same quarter last year[2] - Operating margin (as adjusted) for the three months ended December 31, 2024, was 35.1%, compared to 33.0% in the same period of 2023, showing an improvement of 2.1 percentage points[28] - The effective tax rate (as adjusted) for the three months ended December 31, 2024, was 26.6%, compared to 27.2% in the same period of 2023, showing a slight improvement[29] Expenses - The company reported a 43% increase in income tax expense to$ 19,047,000 for the three months ended December 31, 2024[22] - Total other operating expenses amounted to $7,330 million for the three months ended December 31, 2024, up from$ 5,689 million in the same period of 2023, representing an increase of 28.8%[38] - Employment expense fair value adjustments increased to $1,141 million for the three months ended December 31, 2024, compared to$ 472 million for the same period in 2023, reflecting a significant rise of 141%[38] - Acquisition and integration expenses for the three months ended December 31, 2024, totaled $2.553 million, down from$ 3.050 million in the same period of 2023, reflecting a decrease of 16.3%[36] Forward-Looking Statements and Risks - Forward-looking statements indicate expectations regarding assets under management and net asset inflows, but actual results may differ materially due to various risks and uncertainties[44] - The company faces risks including potential reductions in assets under management and challenges in attracting and retaining key personnel, which could adversely affect financial results[45] - The company does not plan to update or revise forward-looking statements based on actual results or changes in circumstances after the date of the release[47] - Investors are encouraged to consider all factors that may impact the company's operations and financial results, as discussed in periodic reports filed with the SEC[46] Non-GAAP Measures - Non-GAAP financial measures are utilized by management to provide additional insight into the company's financial performance, although they have limitations and should not be viewed in isolation[27] - The adjusted revenues exclude the impact of operating activities of consolidated investment products, focusing on fee revenues from investment management and related services[40] - Adjusted operating expenses exclude amortization or impairment of intangible assets and certain other expenses not reflective of ongoing earnings generation[41] - The adjusted operating margin is calculated as adjusted operating income divided by adjusted revenues, providing a measure of efficiency[42]