GCM Grosvenor(US:GCMG)2025-11-05 21:18Asset Management - As of September 30, 2025, the company managed assets totaling $87.0 billion, up from $80.1 billion as of December 31, 2024, representing an increase of approximately 11.2%[193] - Assets under management subject to carried interest were approximately $47.8 billion as of September 30, 2025[199] - Assets under management subject to performance fees were approximately $14.4 billion as of September 30, 2025[202] - Fee-Paying AUM (FPAUM) increased by $5.4 billion, or 8%, to $70.2 billion during the nine months ended September 30, 2025, primarily due to $6.2 billion of contributions[242] - AUM increased by $6.9 billion, or 9%, to $87.0 billion during the nine months ended September 30, 2025, driven by increases in both FPAUM and Contracted, Not Yet Fee-Paying AUM (CNYFPAUM)[245] - CNYFPAUM increased by $1.0 billion, or 12%, to $9.2 billion during the nine months ended September 30, 2025, due to new commitments[244] Revenue Generation - The company generates revenues from management fees and incentive fees, which include carried interest and performance fees[189] - Total operating revenues increased by $12.0 million, or 10%, to $134.97 million for the three months ended September 30, 2025, compared to $122.93 million for the same period in 2024[215] - Management fees rose by $7.4 million, or 7%, to $105.9 million for the three months ended September 30, 2025, driven by an 8% increase in private markets strategies fees[217] - Incentive fees increased by $2.2 million, or 9%, to $25.47 million for the three months ended September 30, 2025, with carried interest rising by 17% to $24.1 million[218] - For the nine months ended September 30, 2025, total operating revenues increased by $31.72 million, or 9%, to $380.47 million compared to $348.75 million for the same period in 2024[215] - Private markets strategies revenue for Q3 2025 was $62,116,000, up 7.7% from $57,904,000 in Q3 2024[248] - Absolute return strategies revenue increased to $39,235,000 in Q3 2025 from $37,160,000 in Q3 2024, representing a growth of 5.6%[248] - Fee-Related Revenue for the nine months ended September 30, 2025, was $311.051 million, compared to $288.540 million in 2024, reflecting an increase of 8%[268] Expenses and Income - Total operating expenses decreased by $7.1 million, or 7%, to $90.79 million for the three months ended September 30, 2025, compared to $97.93 million for the same period in 2024[215] - Employee compensation and benefits decreased by $7.2 million, or 10%, to $66.09 million for the three months ended September 30, 2025, primarily due to a significant drop in partnership interest-based compensation[222] - Operating income increased by $19.2 million, or 77%, to $44.17 million for the three months ended September 30, 2025, compared to $24.99 million for the same period in 2024[215] - Net income attributable to GCM Grosvenor Inc. increased by $6.34 million, or 153%, to $10.50 million for the three months ended September 30, 2025, compared to $4.16 million for the same period in 2024[215] - Net income for the nine months ended September 30, 2025, was $126.7 million, up from $98.8 million in 2024, representing a year-over-year increase of approximately 28%[276] - Adjusted Net Income for the nine months ended September 30, 2025, was $104,597,000, compared to $88,032,000 for the same period in 2024, reflecting an increase of 18.9%[248] - Adjusted Net Income for Q3 2025 was $10.495 million, a 152% increase from $4.156 million in Q3 2024[260] Tax and Regulatory Environment - The provision for income taxes for the three months ended September 30, 2025, was $3.62 million, compared to $3.19 million for the same period in 2024[215] - The effective tax rate was 8% for the nine months ended September 30, 2025, significantly lower than 55% for the same period in 2024, primarily due to income allocated to noncontrolling interest holders[233] - The company is subject to evolving regulatory requirements, which may impose additional expenses or capital requirements[180] Cash Flow and Financing - Net cash provided by operating activities for the nine months ended September 30, 2025, was $155.058 million, an increase of 40% from $110.674 million in 2024[273] - Cash and cash equivalents as of September 30, 2025, totaled $182.7 million, with an additional available borrowing capacity of $50.0 million under the Revolving Credit Facility[270] - The company expects its cash flow from operations and current cash reserves to be sufficient to fund operations and capital expenditures for the next twelve months[270] - Net cash used in investing activities was $(14.5) million for the nine months ended September 30, 2025, a decrease from $(25.1) million in 2024, showing reduced investment outflows[275] - Net cash used in financing activities was $(48.3) million for the nine months ended September 30, 2025, compared to $(31.5) million in 2024, indicating increased financing costs[275] - As of September 30, 2025, GCMH had borrowings of $432.5 million outstanding under the Term Loan Facility, with no outstanding balance under the Revolving Credit Facility[280] - The Company amended the Term Loan Facility to increase the principal amount from $388.0 million to $438.0 million and extended the maturity date to February 25, 2030[279] Shareholder Returns - The quarterly dividend was increased from $0.11 to $0.12 per share of Class A common stock, effective for holders as of December 1, 2025[285] - The stock repurchase authorization was increased to $220 million as of August 4, 2025, allowing for further buybacks of Class A common stock and warrants[286] - The total leverage ratio was below stated thresholds as of September 30, 2025, indicating compliance with financial covenants[281]