Virtus Investment Partners(US:VRTS)2024-02-28 21:19Assets Under Management - Total assets under management increased to $172.3 billion, a rise of $22.9 billion or 15.3% from December 31, 2022[133] - Positive market performance contributed $24.8 billion to the increase in assets under management, while net outflows totaled $7.2 billion[133] - Retail separate accounts saw a significant increase of $7.85 billion, or 22.2%, in assets under management compared to the previous year[134] - Institutional accounts experienced a growth of $12.3 billion, or 24.3%, in assets under management from December 31, 2022[134] - Open-end funds reported an increase of $3.06 billion, or 5.8%, in assets under management[134] - Closed-end funds experienced a decrease of $335 million, or 3.2%, in assets under management[134] - Average assets under management decreased by $5.31 billion, or 3.2%, compared to the previous year[134] - Assets under management rose by $22.9 billion, or 15.3%, to $172.3 billion at December 31, 2023, compared to $149.4 billion at December 31, 2022[136] Financial Performance - Net income per diluted share increased by $2.21, or 14.3%, to $17.71 in 2023 from $15.50 in 2022[136] - Total sales decreased by $4.4 billion, or 14.6%, to $25.9 billion in 2023 from $30.3 billion in 2022[136] - Total revenues decreased by $41.1 million, or 4.6%, to $845.3 million in 2023 from $886.4 million in 2022[149] - Operating income decreased by $46.0 million, or 23.3%, to $151.5 million in 2023 from $197.5 million in 2022[149] - Net income attributable to Virtus Investment Partners, Inc. for 2023 was $130,621,000, an increase of 11.5% compared to $117,541,000 in 2022[280] - Comprehensive income attributable to Virtus Investment Partners, Inc. for 2023 was $130,892,000, an increase from $117,163,000 in 2022, representing an increase of 11.7%[283] - Net income for 2023 was $141,476,000, an increase from $106,628,000 in 2022[288] Expenses - Investment management fees decreased by $16.9 million, or 2.3%, to $711.5 million in 2023 from $728.3 million in 2022, primarily due to lower average assets under management[149] - Employment expenses increased by $33.5 million, or 9.0%, to $404.7 million in 2023, primarily due to the addition of AlphaSimplex[157] - Distribution and other asset-based expenses decreased by $15.8 million, or 14.0%, to $96.8 million, mainly due to a decrease in average assets under management[158] - Total operating expenses rose by $4.9 million, or 0.7%, to $693.8 million in 2023[156] - Interest expense increased by $10.3 million, or 77.9%, to $23.4 million, attributed to higher average interest rates and debt balances[169] Cash Flow and Investments - Net cash provided by operating activities increased by $104.5 million, or 78.8%, to $237.2 million in 2023[183] - Net cash used in investing activities rose to $129.7 million in 2023, primarily due to the acquisition of AlphaSimplex[184] - The company reported a net cash decrease of $248,165,000 in 2023, contrasting with an increase of $3,034,000 in 2022[289] - The company acquired businesses for a net cash outflow of $108,999,000 in 2023, compared to $20,577,000 in 2022[288] Equity and Dividends - The company declared a quarterly cash dividend of $1.90 per common share, payable on May 15, 2024[117] - Total equity increased by $45.4 million, or 5.5%, to $868.3 million as of December 31, 2023[176] - The company reported a total equity attributable to Virtus Investment Partners, Inc. of $863,926,000 as of December 31, 2023, an increase of 5.8% from $817,019,000 in 2022[277] - Cash dividends declared for 2023 were $7.10 per common share, totaling $53,526,000[288] Acquisition and Goodwill - The acquisition of AlphaSimplex Group, LLC was completed for $113.4 million in cash, with $50.0 million drawn from the revolving credit facility[132] - The carrying value of goodwill was $397.1 million as of December 31, 2023, with no impairment identified during the annual assessment[195] - The carrying value of indefinite-lived intangible assets was $42.3 million as of December 31, 2023, with no impairments identified[196] - The carrying value of definite-lived intangible assets was $389.8 million as of December 31, 2023, with amortization calculated on a straight-line basis[197] Market Performance - The Standard & Poor's 500 Index increased by 24.2% in 2023, reflecting strong market performance[131] - The percentage of assets under management beating benchmarks was 42% for equity, 61% for fixed income, and 59% for alternatives over a three-year period[146] Internal Controls and Compliance - The company maintained effective internal control over financial reporting as of December 31, 2023, based on COSO criteria[257] - The effectiveness of internal control over financial reporting has been audited by Deloitte & Touche LLP as of December 31, 2023[229] - There were no changes in internal control over financial reporting during the fourth quarter of fiscal 2023 that materially affected the company's reporting[226] Company Overview - The Company operates in the investment management industry, providing services to both institutional and individual clients through various investment products[292] - The Company manages assets through institutional separate and commingled accounts, mutual funds, global funds, variable insurance funds, ETFs, and closed-end funds[292] - The Company operates in one business segment as an asset manager, providing investment management services for individual and institutional clients[298]