Artisan Partners(US:APAM)2022-11-02 16:00Assets Under Management - As of September 30, 2022, assets under management declined to $120.6 billion, a decrease of $9.9 billion, or 8%, from $130.5 billion at June 30, 2022, due to $8.8 billion in negative investment returns and $1.1 billion in net client cash outflows[91]. - Average assets under management for the three months ended September 30, 2022, were $132.9 billion, a 25% decrease from $177.6 billion for the same period in 2021[91]. - Total assets under management (AUM) reached $120.607 billion, with a decrease from the previous quarter[105]. - The ending AUM for Artisan Funds and Artisan Global Funds was $120,607 million as of September 30, 2022, down from $173,623 million a year earlier[114]. - The institutional channel accounted for 63.6% of total AUM as of September 30, 2022, slightly up from 63.2% in the previous year[111]. Revenue and Income - Revenue for the three months ended September 30, 2022, was $234.3 million, a decrease of 26% from $316.6 million for the same period in 2021[91]. - Total operating income fell to $78.7 million, down $64.4 million or 45% compared to $143.1 million in the same period last year[121]. - Net income attributable to Artisan Partners Asset Management Inc. was $44.2 million, a decrease of $42.2 million or 49% from $86.4 million in the prior year[121]. - Revenues for the nine months ended September 30, 2022, decreased by $144.9 million, or 16%, to $767.3 million compared to $912.2 million in the same period of 2021[129]. - Net income attributable to Artisan Partners Asset Management Inc. decreased by $98.0 million, or 39%, to $153.9 million from $251.9 million[129]. Client Cash Flows - Net client cash flows for the three months ended September 30, 2022, were $(1.1) billion, compared to a positive inflow of $11 million for the same period in 2021[99]. - Net client cash flows turned negative at $(4,621) million, a significant decline of 287.6% compared to $2,463 million in 2021[100]. - Gross client cash inflows decreased by 13.2% to $22,397 million, down from $25,814 million[100]. - Gross client cash outflows for the nine months ended September 30, 2022, totaled $(27,018) million, compared to $(23,351) million in the same period of 2021, indicating an increase in outflows[110]. Investment Performance - The total returns of the S&P 500 for the three months ended September 30, 2022, were (4.9)%, compared to 0.6% for the same period in 2021[93]. - The Developing World Strategy reported a performance decline of (47.70)%[105]. - The Antero Peak Strategy experienced a decrease of (19.55)% in performance[105]. - The Global Unconstrained Strategy had an ending AUM of $15 million, with a performance increase of 3.00%[105]. - The Emerging Markets Debt Opportunities Strategy had an ending AUM of $41 million, with a performance decrease of (0.18)%[105]. Expenses and Compensation - Total compensation and benefits decreased to $122.1 million, a reduction of $20.1 million or 14% compared to $142.2 million in the previous year[123]. - Other operating expenses increased by $2.2 million, primarily due to higher travel, occupancy, and technology expenses[123]. - Total compensation and benefits decreased by $30.3 million, or 7%, to $389.4 million, representing 51% of revenues for the nine months ended September 30, 2022[134]. - Other operating expenses increased by $14.0 million, or 16%, primarily due to higher travel, occupancy, and technology costs[134]. Dividends and Shareholder Returns - The company declared a quarterly dividend of $0.56 per share of Class A common stock, effective November 1, 2022[91]. - Artisan Partners Holdings declared a variable quarterly dividend of $0.56 per share of Class A common stock for the September quarter of 2022, representing approximately 80% of the cash generated in that quarter[145]. Tax and Liabilities - As of September 30, 2022, the Tax Receivable Agreements (TRAs) liability was recognized at $398.2 million, representing 85% of expected tax benefits from the IPO-related transactions[146]. - The TRA liability decreased from $425.4 million at December 31, 2021, to $398.2 million at September 30, 2022[149]. Cash Flow and Investments - Net cash provided by operating activities decreased by $97.6 million to $306.6 million for the nine months ended September 30, 2022, compared to $404.2 million for the same period in 2021[148]. - Net cash used in investing activities increased by $34.3 million to $(60.5) million for the nine months ended September 30, 2022, primarily due to a $23.2 million increase in net purchases of investment securities[148]. - The company made seed investments totaling $118.0 million as of September 30, 2022, which includes $61.5 million related to funded long-term incentive compensation plans[142].