Silvercrest Asset Management Group(US:SAMG)2025-10-31 00:21Financial Performance - Revenue for the three months ended September 30, 2025, was $31.295 million, compared to $30.424 million in 2024, representing a year-over-year increase of 2.9%[153]. - Net income for the three months ended September 30, 2025, was $1.089 million, down from $3.730 million in 2024, resulting in a net income margin of 3.5% compared to 12.3% in the previous year[153]. - Adjusted EBITDA for the three months ended September 30, 2025, was $4.529 million, down from $6.346 million in 2024, with an adjusted EBITDA margin of 14.5% compared to 20.9% in 2024[153]. - Total revenue for the three months ended September 30, 2025, increased by $0.9 million, or 2.9%, to $31.3 million compared to $30.4 million for the same period in 2024[179]. - Management and advisory fees for the three months ended September 30, 2025, were $30.1 million, up from $29.4 million in 2024, reflecting a growth of $0.7 million or 2.3%[173]. - Total revenue for the nine months ended September 30, 2025, was $93.4 million, an increase of $1.7 million or 1.8% from $91.7 million in 2024[173]. - Adjusted Net Income for the nine months ended September 30, 2025, was $9.6 million, down from $12.9 million in 2024[207]. - Basic Adjusted Earnings Per Share for the three months ended September 30, 2025, was $0.19, compared to $0.27 in 2024[207]. Assets Under Management - Assets under management increased by 2.5% from $36.7 billion to $37.6 billion for the three months ended September 30, 2025, and by 3.0% from $36.5 billion to $37.6 billion for the nine months ended September 30, 2025[150]. - Assets under management as of September 30, 2025, reached $37.6 billion, up from $35.1 billion as of September 30, 2024[173]. - Total assets under management increased by $2.5 billion, or 7.1%, to $37.6 billion as of September 30, 2025, from $35.1 billion at September 30, 2024[184]. - Discretionary assets under management increased by $1.0 billion during the nine months ended September 30, 2025[184]. - Average assets under management for discretionary managed accounts were $23.6 billion for the three months ended September 30, 2025, compared to $21.7 billion in 2024[158]. - The average AUM for the three months ended September 30, 2025, was approximately $37.2 billion, while for the nine months it was about $37.1 billion[233]. Expenses - Total expenses for the three months ended September 30, 2025, increased by $4.0 million, or 15.4%, to $30.0 million from $26.0 million in the same period in 2024[191]. - Compensation and benefits expenses are the largest expense category, expected to rise with growth in headcount and competitive compensation levels[166]. - Compensation and benefits expense rose by $3.1 million, or 16.8%, to $21.7 million for the three months ended September 30, 2025[192]. - General and administrative expenses increased by $0.9 million, or 11.9%, to $8.2 million for the three months ended September 30, 2025[193]. Cash Flow and Liquidity - As of September 30, 2025, cash and cash equivalents decreased to $36.1 million from $68.6 million as of December 31, 2024, representing a decline of approximately 47.4%[216]. - For the nine months ended September 30, 2025, net cash provided by operating activities was $3.7 million, down from $5.2 million in the same period of 2024, a decrease of about 29.0%[222]. - The company used $1.7 million in investing activities for the nine months ended September 30, 2025, compared to $1.3 million in 2024, indicating an increase of approximately 30.8%[223]. - Financing activities resulted in a cash outflow of $34.5 million for the nine months ended September 30, 2025, compared to $16.0 million in 2024, reflecting an increase of about 116.9%[224]. - The company expects to meet its cash and liquidity requirements in the next twelve months primarily through cash generated by operations[210]. Client Flows - Gross client inflows for the nine months ended September 30, 2025, were $3.3 billion, while gross client outflows were $4.0 billion, resulting in net client flows of $(0.7) billion[173]. - Client inflows amounted to $5.6 billion, while client outflows were $5.4 billion during the same period[184]. Market and Investment Strategies - The company aims to develop and market investment strategies that meet client needs and provide attractive long-term returns to increase assets under management[159]. - The company expects investment income from private investment funds to fluctuate based on market conditions and the success of its investment strategies[169]. - Market risk is identified as the most significant risk affecting the valuation of the company's assets under management[231]. - The company utilizes independent pricing services based on observable market prices for asset valuation[231]. Tax and Other Income - The effective tax rate will be offset by benefits from a tax receivable agreement with Class B stockholders[171]. - The provision for income taxes for the three months ended September 30, 2025, was $0.4 million, down from $1.1 million in 2024, reflecting decreased profitability[200]. - The provision for income taxes for the nine months ended September 30, 2025, was $2.6 million compared to $3.6 million in 2024, with a percentage of income before provision for income taxes increasing from 21.6% to 24.3%[201]. - Interest income decreased by 60.4% to $148,000 for the three months ended September 30, 2025, compared to $374,000 in the same period in 2024[197]. - Total other income (expense), net decreased to $0.1 million for the three months ended September 30, 2025, from $0.4 million in the same period in 2024[198]. - For the nine months ended September 30, 2025, total other income decreased to $0.6 million from $0.9 million in the same period of 2024[199]. Shareholder Returns - The company expects to continue paying quarterly cash dividends to holders of Class A common stock, dependent on distributions from Silvercrest L.P.[216]. - The company repurchased approximately 1,504,000 shares of Class A common stock at a cost of $23.7 million during the nine months ended September 30, 2025, compared to 83,000 shares for $1.4 million in 2024[224]. - The anticipated future payments under the tax receivable agreement related to the purchase of Class B units are expected to aggregate approximately $10.2 million[219]. - The company anticipates that distributions to the principals of Silvercrest L.P. will continue to be a significant use of cash resources, varying based on operating results and dividend policy[225]. Accounting and Reporting - Recent accounting developments and their impact on the company are detailed in the "Summary of Significant Accounting Policies" section[235]. - Other adjustments for the three months ended September 30, 2025, totaled $1.7 million, significantly higher than $0.26 million in 2024[208].