Virtus Investment Partners(VRTS) - 2024 Q3 - Quarterly Results

Financial Performance - Diluted earnings per share (EPS) for Q3 2024 was $5.71, an increase of 36% from $4.19 in Q3 2023[2] - Total revenues for the three months ended September 30, 2024, increased by 4% to $227,029,000 compared to $219,271,000 for the same period in 2023[15] - Net income for the three months ended September 30, 2024, increased by 29% to $49,104,000 compared to $38,154,000 for the same period in 2023[15] - Earnings per share (EPS) - basic for the three months ended September 30, 2024, was $5.80, a 36% increase from $4.26 in the same period last year[15] - Total revenues for the quarter ended September 30, 2024, were $227,029 million, an increase of 3.5% compared to $219,271 million for the same period in 2023[22] - Operating income for the quarter was $55,258 million, up 23.0% from $44,903 million in the same quarter last year[22] - Adjusted operating income increased to $70,468 million, reflecting a 5.5% rise from $66,980 million in the prior year[22] - Net income attributable to Virtus Investment Partners, Inc. was $40,980 million, compared to $30,906 million in the same quarter of 2023, marking a 32.5% increase[24] - Earnings per share (diluted) under GAAP was $5.71, up from $4.19 in the same quarter last year, representing a 36.2% increase[24] - The adjusted earnings per share (diluted) was $6.92, compared to $6.21 in the same quarter of 2023, indicating an increase of 11.4%[24] Sales and Revenue Growth - Total sales reached $6.6 billion, up 14% year-over-year, with institutional sales of $1.2 billion increasing 3% and retail separate account sales of $2.3 billion increasing 4%[4][5] - Investment management fees increased by 5% to $193,843,000 for the three months ended September 30, 2024, compared to $184,869,000 for the same period in 2023[15] - Total operating expenses decreased by 1% to $171,771,000 for the three months ended September 30, 2024, compared to $174,368,000 for the same period in 2023[15] - Cash dividends declared per common share increased by 18% to $2.25 for the three months ended September 30, 2024, compared to $1.90 for the same period in 2023[15] Assets Under Management (AUM) - Assets under management (AUM) increased to $183.7 billion, a 13% increase from $162.5 billion year-over-year[4] - Total assets under management (AUM) as of September 30, 2024, reached $183,742,000, an increase from $162,539,000 as of September 30, 2023[18] - Open-End Funds assets under management decreased from $51.1 billion on 9/30/2023 to $49.7 billion on 12/31/2023, with a projected increase to $50.9 billion by 6/30/2024[19] - Closed-End Funds assets under management remained stable, with a slight increase from $58.2 billion on 9/30/2023 to $58.4 billion on 12/31/2023, and projected to reach $58.6 billion by 6/30/2024[19] - Retail Separate Accounts assets under management remained constant at $43.3 billion for both 9/30/2023 and 12/31/2023, with a slight increase projected to $43.9 billion by 3/31/2024[19] - Institutional Accounts assets under management increased from $30.3 billion on 9/30/2023 to $33.2 billion on 12/31/2023, with a projected decrease to $30.7 billion by 6/30/2024[19] Expenses and Financial Adjustments - Operating income rose to $55.3 million, a 25% increase from $44.2 million in the prior quarter, driven by a 5% decrease in operating expenses[7] - Total operating expenses decreased to $171,771 million from $174,368 million year-over-year, a reduction of 0.3%[22] - Employment expenses increased to $105,555 million, up from $101,587 million in the same period last year, reflecting a 4% rise[25] - Interest and dividend income, as adjusted, decreased to $4,736 million from $5,848 million year-over-year, representing a decline of 19%[25] Market Performance and Flows - Net flows were negative at ($1.7) billion, an improvement from ($2.6) billion in the previous quarter, with positive flows in retail separate accounts and ETFs[6] - Total inflows for the quarter were $5.810 billion, while outflows amounted to $(7.309) billion, resulting in net flows of $(1.499) billion[20] - Market performance for the total assets showed a decline of $(3.624) billion for the quarter, with a recovery of $14.322 billion projected for the next quarter[20] Strategic Initiatives and Future Outlook - The company is actively exploring market expansion opportunities and new product developments to enhance its service offerings[19] - Future outlook includes a focus on enhancing investment management services and expanding market presence through strategic initiatives[20] - The company anticipates continued growth in assets under management and net asset inflows, although specific projections were not provided[35] - Forward-looking statements indicate potential risks and uncertainties regarding future performance and market conditions[34] Risks and Uncertainties - The company faces substantial known and unknown risks and uncertainties that could materially affect operations and financial results[36] - Key risks include reduction in assets under management and inability to achieve expected benefits from strategic transactions[36] - Other significant risks involve withdrawal or termination of investment management agreements and challenges from competition[36]