SEI(SEIC) - 2024 Q4 - Annual Report

Financial Performance - Revenues increased by $205.4 million, or 11$2.1 billion in 2024 compared to 2023, while net income rose by $118.9 million, or 26$581.2 million[185]. - Operating profit for the Investment Managers segment increased by $49.2 million, or 22$195.0 million in 2024 from $170.1 million in 2023, a growth of 15$457.6 million in 2024, up from $426.3 million in 2023, while net income also rose by 7$351.8 million[221]. - SEI's proportionate share in the earnings of LSV grew by 7% to $135.7 million in 2024 compared to$126.9 million in 2023[221]. Assets and Administration - Average assets under administration increased by $132.9 billion, or 15$1.0 trillion in 2024, driven by cross sales and new sales within the Investment Managers segment[185]. - Total assets under management increased by 10% to $476.7 billion in 2024, up from$432.0 billion in 2023[202]. - Client assets under administration rose by 12% to $1,055.9 billion in 2024, compared to$942.8 billion in 2023[202]. - Average assets under management for investment managers increased by 27% to $187.8 billion in 2024, compared to$148.4 billion in 2023[204]. - Platform-only assets grew by 44% to $27.6 billion in 2024, up from$19.2 billion in 2023[202]. - Client assets under advisement surged by 62% to $9.0 billion in 2024, compared to$5.6 billion in 2023[205]. Revenue Growth by Segment - Investment Managers segment revenues increased by $83.1 million, or 13$728.4 million in 2024 compared to 2023, with an operating profit margin of 38%[208]. - Private Banks segment revenues rose by $45.1 million, or 9$541.4 million in 2024, with operating income increasing by 69% to $81.0 million[210]. - Investment Advisors segment revenues grew by$73.1 million, or 17%, to $509.4 million in 2024, with an operating margin of 44$4.0 million, or 1%, to $285.7 million in 2024, but operating income increased by 5$131.0 million[216]. - Investments in New Businesses segment revenues increased by $8.0 million, or 15$60.2 million in 2024, driven by growth in SEI Family Office Services and SEI Private Wealth Management[217]. Acquisitions and Investments - SEI acquired LifeYield, LLC for $29.0 million in December 2024, enhancing its technology offerings[185]. - The company acquired LifeYield in 2024, and previously acquired National Pensions Trust and Altigo in 2023, aiming to enhance capabilities and scale competitive presence[196]. - The net cash payment for the acquisition of LifeYield in 2024 was$29.0 million, while in 2023, net cash payments for acquisitions totaled $56.4 million[245]. Operating Expenses and Profitability - Operating expenses rose due to higher personnel costs and inflation, but cost containment measures partially offset these increases[185]. - Corporate overhead expenses increased to$147.6 million in 2024, primarily due to incentive compensation and investments in technology[218]. - The overall profitability may be negatively impacted if strategic investments do not generate timely revenues[195]. Cash Flow and Liquidity - Net cash provided by operating activities increased significantly to $622.3 million in 2024, compared to$447.0 million in 2023, an increase of $175.3 million[239]. - Cash and cash equivalents at the end of 2024 were$840.2 million, slightly up from $835.0 million at the end of 2023[239]. - The company anticipates that available funds and cash flow from operations will be sufficient to meet operational cash needs and fund the stock repurchase program for at least the next 12 months[248]. - The company’s unused sources of liquidity at December 31, 2024, included cash and cash equivalents along with available amounts under its credit facility[247]. Shareholder Returns - SEI repurchased 6.8 million shares at an average price of$74.92 per share, totaling $512.5 million, and paid$120.3 million in dividends in 2024[185]. - Cash dividends paid in 2024 amounted to $120.3 million, with a dividend of$0.92 per share, up from $114.8 million and$0.86 per share in 2023[245]. Taxation - The effective tax rate was 22.2% in 2024, slightly down from 22.3% in 2023[185]. - The effective tax rate for 2024 was 22.2%, a slight decrease from 22.3% in 2023, primarily due to the recognition of tax credits and a reduction in the valuation reserve for net operating losses[229]. Market Outlook - The company anticipates that macroeconomic factors could significantly influence capital markets and, consequently, its revenues and earnings in 2025 and beyond[191].