Group 1 - Hamilton Lane Incorporated (NASDAQ: HLNE) shares have sharply declined following the release of Q4 FY 2025 earnings despite reporting strong results [1] - The company's stock was trading at a substantial premium to peers, creating a high bar for performance expectations [1] Group 2 - Blue Chip Portfolios is an investment publication focused on providing insights on single stocks, ETFs, and CEFs [1]

Debt and Financial Obligations - The Term Loan Agreement matures on July 1, 2029, with additional agreements maturing on April 1, 2030, and October 1, 2029, indicating a structured debt repayment schedule [189]. - The company expects to continue utilizing debt for operations, which may increase vulnerability to economic downturns and affect operational flexibility [190]. - The company’s credit facilities are concentrated with JPMorgan, following the acquisition of First Republic, which could pose risks if financial institutions face instability [191]. - There is a concentration of credit risk due to account balances exceeding FDIC insurance coverage of $250,000 per depositor, potentially impacting liquidity [192]. - The company may face challenges in complying with financial covenants in Loan Agreements, which could limit operational flexibility and lead to defaults [196]. - The company’s obligations under Loan Agreements are secured by substantially all assets, which could lead to significant consequences in the event of a default [196]. - The company’s ability to access funding sources may be impaired by factors affecting the financial institutions it relies on, impacting overall business operations [194]. - The company has approximately 12.7 million shares of Class A common stock issuable upon exchange of Class B and Class C units, which will be eligible for resale subject to certain restrictions [327]. - As of March 31, 2025, the company had $193.1 million in borrowings outstanding under Loan Agreements, with an annual interest rate of 6.25% on the Term Loan Agreement and 6.00% on the Revolving Loan Agreement [506]. - A 100 basis point increase in interest rates is estimated to result in an increased interest expense of approximately $0.9 million over the next 12 months [507]. Investment Performance and Risks - The performance of investments in specialized funds and customized accounts directly affects management revenue, with poor performance leading to decreased earnings and capital raising difficulties [206]. - Defaults by clients or investors in specialized funds could adversely affect fund operations and performance, particularly during economic uncertainty [201]. - The risk of clawback obligations exists if previously distributed carried interest exceeds amounts ultimately entitled, which could affect financial stability [206]. - The company's cash flow may fluctuate significantly due to sporadic and unpredictable distributions of carried interest, impacting steady earnings growth [207]. - Carried interest distributions may decrease in volatile economic environments, making it difficult to predict timing and amounts, leading to increased stock price volatility [208]. - Redemption or repurchase rights in evergreen funds may adversely affect revenues, especially during declining market conditions [209]. - Sustained redemption requests could exhaust liquidity sources, forcing the company to dispose of investments sooner than anticipated, potentially reducing carried interest [211]. - Valuation methodologies for specialized funds can be highly subjective, leading to significant losses if fair values are not realized [213]. - Investments in high-risk, illiquid assets may result in losses or failure to realize profits for extended periods [217]. - Portfolio companies may experience financial difficulties during market downturns, adversely affecting investment returns [220]. - The company may pursue complex investment opportunities that involve regulatory and legal risks, potentially impacting returns [221]. - Lack of diversification in specialized funds could lead to significant adverse impacts on investment performance [223]. Regulatory and Compliance Risks - The company is subject to extensive government regulation, and changes in laws or regulations could impose additional expenses or limit fundraising activities [282]. - The SEC has increased scrutiny on the asset management and private equity industries, focusing on fees, expense allocations, and disclosures, which may affect the company's operations [289]. - The company is subject to various international regulations, including the AIFMD in the EU, which may impose additional compliance burdens and affect its ability to operate [298]. - Compliance with MiFID II has resulted in increased complexity and higher operational costs for the company [299]. - New prudential regulations in the EU and U.K. could hinder the company's capital deployment and recruitment efforts [300]. - Regulatory requirements aimed at enhancing retail investor protection may impose additional operational costs and limit access to capital from retail investors [301]. - Non-compliance with existing or new laws and regulations could have a material adverse effect on the company's financial condition and operations [302]. - The company faces increasing scrutiny and demands regarding ESG matters from investors and regulators, which may impact return potential and fundraising capabilities [303]. - Certain investors are focusing on ESG integration, potentially hampering return potential and leading to operational complexities and costs [303]. - Regulatory penalties related to insufficient compliance with ESG laws could adversely affect profitability and reputation [304]. - Climate change risks, including compliance costs and regulatory actions, may negatively impact returns for the company and its portfolio companies [305]. - Enhanced disclosure obligations due to climate-related regulations could increase compliance costs and administrative burdens [306]. - The company relies on third-party data for ESG-related reporting, and inaccuracies in this data could harm its reputation and lead to enforcement actions [264]. - Legal liabilities related to investment management activities are increasing, with potential for significant damages from claims of misleading statements or negligent conduct [254][255]. Operational and Cybersecurity Risks - The company faces significant challenges in maintaining adequate financial and operational controls, which may lead to increased expenses and resource commitments [228]. - Operational risks, including technology failures and cybersecurity threats, could disrupt business and result in financial losses [236]. - The company relies on secure processing and storage of sensitive information, with potential cybersecurity threats posing significant risks [237]. - Unauthorized access and data breaches could lead to material financial losses and reputational damage for the company [240]. - The company faces increased compliance costs and potential regulatory liabilities due to rapidly evolving data security and privacy laws, including GDPR and CPRA, which could lead to significant penalties [241][245]. - Compliance obligations are expanding, requiring adherence to various international data protection laws, which may increase operational complexities and costs [243][244]. - There is a heightened risk of data theft or compromise, particularly in jurisdictions with weaker protections for intellectual property and sensitive information [256][258]. - The company may face challenges in managing international operations, including compliance with diverse regulatory environments and potential currency fluctuations [256][259]. Market and Economic Risks - A pandemic or global health crisis could materially impact the company's business, financial condition, and results of operations, exacerbating existing risks [265]. - The company may experience reduced revenue and cash flow during economic downturns or tightening global credit markets, leading to potential write-downs of investment valuations [277]. - Market volatility and geopolitical conflicts, such as the ongoing war between Russia and Ukraine, contribute to uncertainty and could negatively impact investment valuations [273]. - The company may face challenges in fundraising efforts due to negative international reactions to U.S. trade policies, potentially affecting client relationships [274]. - Operational risks from another pandemic include employee illness and compliance challenges, which could reduce productivity and increase costs [267]. Tax and Financial Management - HLA, the company's primary asset, is required to make substantial tax distributions to members, which may exceed actual tax liabilities [320]. - Tax distributions from HLA are based on an assumed tax rate, likely leading to distributions that significantly exceed actual tax obligations [321]. - Payments under the tax receivable agreement could be substantial and may negatively impact liquidity if they exceed actual cash savings [316]. - The company may not be reimbursed for payments made under the tax receivable agreement if the IRS challenges the tax basis increases [319]. - The company's effective tax rate and liabilities are subject to complex interpretations of current tax laws, which could lead to increased tax liabilities if challenged by authorities [285]. - Changes in U.S. tax laws could impact the company's tax liabilities and increase regulatory compliance costs, with uncertain timing and details [284]. Corporate Governance and Shareholder Relations - The company expects to continue paying dividends to stockholders, but this is subject to the discretion of the board of directors and various legal limitations [329]. - The company’s ability to declare and pay dividends is subject to Delaware law, which may limit the amount of funds available for dividends [329]. - Anti-takeover provisions in the company’s charter documents may make it more difficult for stockholders to replace current management, potentially affecting the market price of Class A common stock [330]. - The disparity in voting rights between Class A and Class B common stock may adversely affect the price of Class A common stock, as Class B stockholders have superior voting rights [324]. - The company’s management fees are generally based on commitments or net invested capital, which are not significantly impacted by changes in investment values [504]. - Management fees from specialized funds and customized separate accounts are based on the amount of capital committed or invested, not significantly affected by changes in fair value [508]. - Incentive fees from specialized funds are based on realized gains and performance criteria, not materially affected by unrealized investment fair value changes [508]. - The company limits counterparties in financial transactions to reputable financial institutions to minimize credit risk exposure [509]. - There have been no material changes in market risk exposures since March 31, 2024 [510].

Core Viewpoint - Hamilton Lane Incorporated is conducting its Q4 and Fiscal Year End 2025 Earnings Call, highlighting its financial performance and future expectations [1][3]. Group 1: Company Overview - The earnings call is led by John Oh, Head of Shareholder Relations, alongside Erik Hirsch, Co-CEO, and Jeffrey Armbrister, CFO [2][3]. - A press release and slide presentation detailing the financial results have been made available on the company's website [3]. Group 2: Forward-Looking Statements - The company emphasizes that forward-looking statements regarding financial position, results, and future performance are subject to risks and uncertainties [4]. - It is noted that these statements do not guarantee future events or performance and may differ materially from actual results [4].

Financial Data and Key Metrics Changes - Total asset footprint at fiscal year end 2025 was $958 billion, a 4% increase year over year [5] - Assets Under Management (AUM) stood at $138 billion, growing by $14 billion or 11% compared to the prior year [6] - Total management and advisory fees were $514 million, reflecting a 14% year-over-year growth [6] - Fee-related earnings reached $276 million, a 34% increase versus the prior year, translating into GAAP EPS of $5.41 and non-GAAP EPS of $5.40 [7][8] - The Board approved a 10% increase in the annual dividend to $2.16 per share [8] Business Line Data and Key Metrics Changes - Total fee-earning AUM was $72 billion, growing by $6 billion or 10% year over year [14] - Customized separate accounts grew to $39 billion, an increase of $1.8 billion or 5% [15] - Specialized fund fee-earning AUM reached $33 billion, growing by $4.5 billion or 16% [17] - Revenue from specialized funds increased by $54 million or 21% compared to the prior year [37] - Revenue from reporting, monitoring, data, and analytics offerings increased by $5 million or 18% [38] Market Data and Key Metrics Changes - Overall exit activity remained muted, but deal activity showed recovery in 2024 compared to 2023 [11] - Contributions and distributions from Limited Partners (LPs) remained below historical averages, although distribution activity saw a slight pickup in 2024 [12] - Record deal flow was observed in secondaries and direct investing, with strength across sub-asset classes [13] Company Strategy and Development Direction - The company is focused on delivering long-term results for clients, particularly during market volatility [13] - Continued investment in specialized fund platforms, particularly semi-liquid evergreen funds, is a key growth strategy [14] - The company is actively launching new products and expanding existing ones to capture market opportunities [21][24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating market volatility and capitalizing on emerging opportunities [9] - The investment environment is characterized by political-driven changes, creating unpredictability [79] - Management anticipates a stable margin outlook despite rising G&A expenses due to ongoing investments in growth [46][47] Other Important Information - The company has implemented changes in reporting for incentive fees and fee-related earnings, including a shift to a high watermark methodology [30][31] - The company is investing in technology solutions, such as the acquisition of 73 Strings, to enhance operational efficiency [28] Q&A Session Summary Question: Margin outlook under new reporting regime - Management expects margins to remain stable despite changes in reporting methodology [46][47] Question: Changes in distribution fees for new products - Distribution fees remain predominantly upfront, with no significant changes observed [48][50] Question: Fee-related earnings margin expectations - Management anticipates FRE margins to be in the high 40% range moving forward [55] Question: Growth in separate accounts business - The separate accounts business has been impacted by macro market conditions, but management is optimistic about future growth as markets normalize [59][61] Question: Institutional interest in evergreen funds - Management believes the trend towards evergreen funds is still in its early stages, with significant potential for growth [80][82]

Financial Data and Key Metrics Changes - Total asset footprint increased to $958 billion, representing a 4% year-over-year growth [4] - Assets Under Management (AUM) grew to $138 billion, an increase of $14 billion or 11% compared to the prior year [5] - Total management and advisory fees reached $514 million, growing 14% year-over-year [6] - Fee-related earnings were $276 million, a 34% increase from the previous year, translating into GAAP EPS of $5.41 and non-GAAP EPS of $5.40 [6] Business Line Data and Key Metrics Changes - Fee-earning AUM stood at $72 billion, growing $6 billion or 10% year-over-year [14] - Specialized fund fee-earning AUM increased to $33 billion, representing a 16% growth [16] - Revenue from customized separate accounts increased by $6 million or 4% due to new accounts and re-ups [38] Market Data and Key Metrics Changes - Overall exit activity remains muted, but deal activity in various sectors showed recovery in 2024 compared to 2023 [12] - Contributions and distributions from Limited Partners (LPs) remained below historical averages, although distribution activity saw a slight pickup in 2024 [12] Company Strategy and Development Direction - The company is focusing on long-term results for clients, capitalizing on market volatility to find opportunities [13] - Continued growth in specialized funds, particularly semi-liquid evergreen funds, is a key strategy [14] - The company is actively expanding its product lines and enhancing its technology solutions [28] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating market volatility and uncertainty, indicating a stable margin outlook despite reporting changes [46][47] - The current market environment is seen as different from past crises, driven by political factors rather than economic shocks [79] Other Important Information - The Board approved a 10% increase in the annual fiscal dividend to $2.16 per share, marking the eighth consecutive annual double-digit percentage increase since 2017 [6] - The company is investing in technology solutions to enhance operational efficiency and scalability [28] Q&A Session Summary Question: Margin outlook under new reporting regime - Management expects margins to remain stable despite changes in reporting [46][47] Question: Changes in distribution fees for new products - Distribution fees remain predominantly upfront, with no significant changes noted [49][50] Question: Future management fees within separate accounts - The separate account business is impacted by macro market conditions, but there is optimism for future growth as markets normalize [59][61] Question: May gross inflows and outflows - May showed strong inflows, with no significant changes in redemption patterns [65][66] Question: Institutional interest in evergreen funds - The trend towards evergreen funds is still in its early stages, with institutions beginning to recognize their benefits [70][72] Question: Capitalizing on market volatility - The company is focusing on deal flow, talent acquisition, and technology investments to capitalize on current market conditions [76][78]

Financial Performance - For the quarter ended March 2025, Hamilton Lane reported revenue of $197.97 million, reflecting a year-over-year increase of 12.1% [1] - The earnings per share (EPS) for the quarter was $1.21, down from $1.38 in the same quarter last year [1] - The reported revenue exceeded the Zacks Consensus Estimate of $173.56 million by 14.07%, while the EPS surprise was +0.83% compared to the consensus estimate of $1.20 [1] Key Metrics - Fee Earning AUM for Customized Separate Accounts was $39.34 billion, below the estimated $40.75 billion [4] - Total Fee Earning AUM was $72.05 billion, compared to the average estimate of $73.20 billion [4] - Total AUM & AUA stood at $957.77 billion, lower than the average estimate of $981.89 billion [4] Revenue Breakdown - Incentive fees revenue was reported at $70.14 million, significantly higher than the average estimate of $43.72 million, marking a year-over-year increase of 32.4% [4] - Management and advisory fees for Customized Separate Accounts were $32.26 million, slightly below the estimate of $35.02 million, with a year-over-year change of +0.4% [4] - Management and advisory fees overall were $127.84 million, compared to the estimate of $129.54 million, reflecting a +3.3% change year-over-year [4] Stock Performance - Hamilton Lane's shares have returned +13.6% over the past month, outperforming the Zacks S&P 500 composite's +6.7% change [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance relative to the broader market in the near term [3]

分组1 - Hamilton Lane reported quarterly earnings of $1.21 per share, exceeding the Zacks Consensus Estimate of $1.20 per share, but down from $1.38 per share a year ago, representing an earnings surprise of 0.83% [1] - The company achieved revenues of $197.97 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 14.07%, compared to $176.66 million in the same quarter last year [2] - Hamilton Lane has outperformed the S&P 500 with an 18.5% increase in shares since the beginning of the year, while the S&P 500 gained only 0.1% [3] 分组2 - The current consensus EPS estimate for the upcoming quarter is $0.91 on revenues of $156.74 million, and for the current fiscal year, it is $4.52 on revenues of $679.14 million [7] - The Financial - Investment Management industry, to which Hamilton Lane belongs, is currently ranked in the bottom 12% of over 250 Zacks industries, indicating potential challenges ahead [8]

Financial Performance - Management and advisory fees for FY25 reached $513.9 million, a 14% increase compared to FY24[4] - GAAP net income for FY25 was $217.4 million, a 54% increase compared to FY24[4] - GAAP EPS for FY25 was $5.41, a 47% increase compared to FY24[4] - Adjusted EBITDA for FY25 was $366.1 million, a 34% increase compared to FY24[4] - Incentive fees YTD increased by 95% from $102 million in FY24 to $199 million in FY25[25] - Total revenues YTD increased by 29% from $554 million in FY24 to $713 million in FY25[20] Assets Under Management (AUM) - Assets under management reached $138 billion as of March 31, 2025, an 11% increase compared to March 31, 2024[6] - Fee-earning assets under management reached $72 billion as of March 31, 2025, a 10% increase compared to March 31, 2024[6] - Total assets under advisement (AUA) reached $819.473 billion as of March 31, 2025, a 3% increase compared to March 31, 2024[57] Other Key Items - The company declared a quarterly dividend of $0.54 per share of Class A common stock[5] - Unrealized carried interest as of March 31, 2025, was $1.3 billion diversified across 3,000+ assets and over 110 funds[26]

[Report Overview & FY2025 Highlights](index=1&type=section&id=Report%20Overview%20%26%20FY2025%20Highlights) Hamilton Lane reported strong growth for fiscal year 2025, marked by an 11% increase in Assets Under Management to $138 billion and a 14% rise in management and advisory fees to $513.9 million [Fiscal Year 2025 Highlights](index=1&type=section&id=Fiscal%20Year%202025%20Highlights) Hamilton Lane reported strong growth for fiscal year 2025, marked by an 11% increase in Assets Under Management to $138 billion and a 14% rise in management and advisory fees to $513.9 million. The company achieved a GAAP EPS of $5.41 and increased its target full-year dividend by 10% to $2.16 per share Fiscal Year 2025 Key Metrics (Year-over-Year) | Metric | Value | YoY Growth | | :--- | :--- | :--- | | Assets under management (AUM) | $138 billion | 11% | | Fee-earning AUM | $72 billion | 10% | | Management and advisory fees | $513.9 million | 14% | | Unrealized carried interest | $1.3 billion | 3% | | GAAP Net Income | $217.4 million | 54% | | GAAP EPS | $5.41 | 47% | - Declared a quarterly dividend of **$0.54 per share** of Class A common stock. The target full-year dividend of **$2.16** represents a **10% increase** from the prior fiscal year[6](index=6&type=chunk)[21](index=21&type=chunk) [Business Performance & Asset Growth](index=9&type=section&id=Business%20Performance%20%26%20Asset%20Growth) The company demonstrated robust asset growth in FY2025, with total AUM & AUA reaching $958 billion and fee-earning AUM increasing 10% to $72 billion, driven by new client activity and successful fundraises [Assets Under Management & Advisement (AUM & AUA)](index=10&type=section&id=Assets%20Under%20Management%20%26%20Advisement%20(AUM%20%26%20AUA)) As of March 31, 2025, total Assets Under Management and Advisement (AUM & AUA) reached $958 billion. Discretionary AUM grew 11% year-over-year to $138 billion, while non-discretionary AUA increased by 3% to $819 billion. Growth was driven by new client wins, re-ups, and successful fundraising for various specialized funds AUM & AUA Growth (as of March 31) | Metric | 2024 | 2025 | YoY Growth | | :--- | :--- | :--- | :--- | | Total AUM | $124B | $138B | 11% | | Total AUA | $796B | $819B | 3% | | Total AUM & AUA | $921B | $958B | 4% | - Growth drivers include: - **Customized Separate Accounts:** New client wins and re-ups from existing clients, with over **80% of gross contributions** in the last 12 months coming from existing clients[32](index=32&type=chunk) - **Specialized Funds:** Fundraising for direct equity, credit-oriented, infrastructure, impact, and evergreen funds[32](index=32&type=chunk) - **Advisory Services:** Robust opportunity set for technology-driven reporting, monitoring, and analytics services[32](index=32&type=chunk) [Fee-Earning AUM (FEAUM)](index=12&type=section&id=Fee-Earning%20AUM%20(FEAUM)) Fee-Earning AUM (FEAUM) increased by 10% year-over-year to $72 billion as of March 31, 2025. This growth was balanced between Customized Separate Accounts, which grew 5% to $39 billion, and Specialized Funds, which grew 16% to $33 billion. The overall management fee rate as a percentage of average FEAUM remained stable FEAUM Growth by Type ($B) | Date | Customized Separate Accounts | Specialized Funds | Total FEAUM | | :--- | :--- | :--- | :--- | | Mar-23 | $38 | $28 | $66 | | Mar-24 | $39 | $33 | $72 | - Key drivers for FEAUM growth: - **Customized Separate Accounts:** Driven by new client acquisitions and client re-ups[30](index=30&type=chunk) - **Specialized Funds:** Supported by the closing of the 6th secondary fund and ongoing fundraising for multiple other strategies including credit, direct equity, infrastructure, and impact funds[30](index=30&type=chunk) FY 2025 FEAUM Roll-Forward ($M) | Description | Amount | | :--- | :--- | | Beginning Balance (Mar 31, 2024) | $65,749 | | Contributions | $3,532 | | Distributions | ($2,671) | | FX, Market Value, Other | $192 | | **Ending Balance (Mar 31, 2025)** | **$72,047** | [Financial Performance](index=16&type=section&id=Financial%20Performance) Hamilton Lane achieved strong financial results in FY2025, with total revenues up 29% to $713 million, GAAP net income increasing 54% to $217 million, and a robust balance sheet supporting continued growth [Revenue Analysis](index=18&type=section&id=Revenue%20Analysis) For fiscal year 2025, total revenues increased 29% to $713 million, significantly boosted by a 95% surge in incentive fees to $199 million. The core, recurring Management and Advisory fees grew by a strong 14% to $514 million, continuing to represent over 80% of total revenues on average over the past five years Revenue Performance ($M) | Revenue Type | FY24 | FY25 | YoY Change | | :--- | :--- | :--- | :--- | | Management and advisory fees | $451.9 | $513.9 | 14% | | Incentive fees | $101.9 | $198.3 | 95% | | **Total revenues** | **$553.8** | **$713.0** | **29%** | - Recurring management and advisory fees have constituted an average of over **80% of total revenues** over the past five fiscal years, providing a stable revenue base[42](index=42&type=chunk) - Incentive fees are derived from a highly diversified pool of over **110 funds** and more than **3,000 assets**, though the timing of their realization is unpredictable[42](index=42&type=chunk) [Unrealized Carried Interest](index=20&type=section&id=Unrealized%20Carried%20Interest) The unrealized carried interest balance grew 3% year-over-year to $1.26 billion as of March 31, 2025. The portfolio is mature, with 53% of the value in funds aged 5-8 years and another 17% in funds aged 8-12 years, suggesting potential for future realizations Unrealized Carried Interest Balance ($M) | Date | Balance | | :--- | :--- | | Mar-23 | $1,221 | | Mar-24 | $1,260 | | Mar-25 | $1,260 | - The unrealized carry is diversified by fund vintage: - **< 5 years:** 24% - **5-8 years:** 53% - **8-12 years:** 17% - **> 12 years:** 6%[47](index=47&type=chunk) [Earnings Analysis](index=22&type=section&id=Earnings%20Analysis) The company demonstrated strong profitability growth in fiscal 2025. GAAP Net Income attributable to HLI rose 54% to $217 million. On a non-GAAP basis, Adjusted EBITDA increased 34% to $366 million, and Fee Related Earnings (FRE) grew 34% to $276 million, driven by robust growth in both management and incentive fees Earnings Performance ($M) | Metric | FY24 | FY25 | YoY Change | | :--- | :--- | :--- | :--- | | Net Income (to HLI) | $141 | $217 | 54% | | Adjusted EBITDA | $273 | $366 | 34% | | Fee Related Earnings | $207 | $276 | 34% | - The **34% year-over-year increase** in Adjusted EBITDA was driven by growth in both incentive fees and management and advisory fees[56](index=56&type=chunk) - Fee Related Earnings have shown consistent long-term double-digit growth, with a **5-year CAGR of 20%**[54](index=54&type=chunk)[57](index=57&type=chunk) [Balance Sheet & Investments](index=24&type=section&id=Balance%20Sheet%20%26%20Investments) Hamilton Lane maintains a strong balance sheet, with its total investment balance growing to $761 million as of March 31, 2025. The company utilizes modest leverage, with total debt at $290 million - The total investment balance of **$761 million** as of March 31, 2025, consisted primarily of: - **~$454 million** in investments in the company's own funds - **~$307 million** in technology-related and other investments[64](index=64&type=chunk) - The company maintains a modest leverage profile, with **$290 million of debt** as of March 31, 2025[65](index=65&type=chunk) [Appendix: Detailed Financial Statements](index=26&type=section&id=Appendix%3A%20Detailed%20Financial%20Statements) This appendix provides comprehensive financial statements for fiscal year 2025, detailing consolidated income, non-GAAP measures, revenue breakdowns, asset roll-forwards, balance sheets, and cash flow statements [Consolidated Statements of Income](index=28&type=section&id=Consolidated%20Statements%20of%20Income) For the fiscal year ended March 31, 2025, total revenues were $713.0 million, a 29% increase from $553.8 million in the prior year. This growth led to a Net Income Attributable to Hamilton Lane Incorporated of $217.4 million, up 54% year-over-year, resulting in a diluted EPS of $5.41 Condensed Consolidated Statements of Income (Year Ended March 31, $ in thousands) | Line Item | 2024 | 2025 | % Change | | :--- | :--- | :--- | :--- | | Total revenues | $553,842 | $712,963 | 29% | | Total expenses | $308,024 | $396,411 | 29% | | Income before income taxes | $281,661 | $362,277 | 29% | | Net income | $227,207 | $313,768 | 38% | | **Net income attributable to Hamilton Lane Inc.** | **$140,858** | **$217,417** | **54%** | | **Diluted EPS** | **$3.69** | **$5.41** | **47%** | [Non-GAAP Financial Measures & Reconciliation](index=30&type=section&id=Non-GAAP%20Financial%20Measures%20%26%20Reconciliation) For fiscal year 2025, key non-GAAP metrics showed significant growth. Fee Related Earnings (FRE) increased 34% to $276.5 million with a margin of 48%. Adjusted EBITDA grew 34% to $366.1 million. Adjusted Net Income rose 29% to $273.7 million, resulting in a Non-GAAP EPS of $5.04 Non-GAAP Financial Measures (Year Ended March 31, $ in thousands) | Metric | 2024 | 2025 | % Change | | :--- | :--- | :--- | :--- | | Fee Related Earnings | $206,719 | $276,465 | 34% | | Adjusted EBITDA | $272,524 | $366,069 | 34% | | Adjusted net income | $211,529 | $273,741 | 29% | | Non-GAAP earnings per share | $3.92 | $5.04 | 29% | [Detailed Revenue Breakdown](index=32&type=section&id=Detailed%20Revenue%20Breakdown) For fiscal year 2025, Specialized Funds were the primary driver of management and advisory fees, contributing $315.2 million (61% of total), a 21% increase year-over-year. Incentive fees surged 95% to $199.1 million, with Evergreen funds being the largest contributor at $69.6 million, a 352% increase from the prior year Management and Advisory Fees by Source (FY2025, $M) | Source | Revenue | % of Total | | :--- | :--- | :--- | | Specialized funds | $315.2 | 61% | | Customized separate accounts | $134.4 | 26% | | Reporting and other | $29.2 | 8% | | Advisory | $22.8 | 5% | | **Total** | **$513.9** | **100%** | Incentive Fees by Source (Year Ended March 31, $ in thousands) | Source | 2024 | 2025 | % Change | | :--- | :--- | :--- | :--- | | Evergreen funds | $15,404 | $69,603 | 352% | | Secondary funds | $41,464 | $46,601 | 12% | | Other specialized funds | $17,861 | $36,779 | 106% | | Customized separate accounts | $11,918 | $16,204 | 36% | | Direct credit funds | $7,872 | $14,963 | 90% | | Direct equity funds | $7,387 | $14,949 | 102% | | **Total** | **$101,906** | **$199,099** | **95%** | [Asset Roll-Forward](index=36&type=section&id=Asset%20Roll-Forward) Total Assets Under Management (AUM) grew 11% from $124.4 billion to $138.3 billion during fiscal year 2025. Fee-Earning AUM (FEAUM) increased by 10% from $65.7 billion to $72.0 billion, with net new capital from contributions exceeding distributions Fee-Earning AUM Roll-Forward (Year Ended Mar 31, 2025, $M) | Description | Customized Separate Accounts | Specialized Funds | Total | | :--- | :--- | :--- | :--- | | Balance, beginning of period | $37,574 | $28,175 | $65,749 | | Contributions | $1,939 | $1,593 | $3,532 | | Distributions | ($2,244) | ($427) | ($2,671) | | FX, market value and other | ($135) | $327 | $192 | | **Balance, end of period** | **$39,343** | **$32,704** | **$72,047** | [Consolidated Balance Sheets](index=38&type=section&id=Consolidated%20Balance%20Sheets) As of March 31, 2025, total assets stood at $1.69 billion, a significant increase from $1.27 billion the prior year, driven by higher cash, fees receivable, and investments. Total liabilities rose to $766.5 million from $595.2 million, primarily due to increased debt and a larger payable to related parties under the tax receivable agreement Condensed Consolidated Balance Sheets ($ in thousands) | (As of March 31) | 2024 | 2025 | | :--- | :--- | :--- | | **Total assets** | **$1,271,200** | **$1,690,355** | | Cash and cash equivalents | $114,634 | $229,161 | | Investments | $603,697 | $664,354 | | **Total liabilities** | **$595,242** | **$766,460** | | Debt | $196,159 | $290,303 | | Payable to related parties (TRA) | $201,422 | $240,648 | | **Total equity** | **$675,958** | **$923,895** | [Consolidated Statements of Cash Flows](index=40&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For the fiscal year ended March 31, 2025, the company generated $300.8 million in net cash from operating activities. Net cash used in investing activities was $117.6 million, largely due to contributions to partnerships. Financing activities used a net $19.2 million, reflecting dividend payments and debt management activities Condensed Consolidated Statements of Cash Flows (Year Ended March 31, $ in thousands) | Cash Flow Activity | 2024 | 2025 | | :--- | :--- | :--- | | Net cash provided by operating activities | $120,852 | $300,820 | | Net cash (used in) investing activities | $(122,184) | $(117,576) | | Net cash provided by (used in) financing activities | $4,399 | $(19,157) | | **Increase in cash and cash equivalents** | **$3,067** | **$163,985** |

Analysts on Wall Street project that Hamilton Lane (HLNE) will announce quarterly earnings of $1.12 per share in its forthcoming report, representing a decline of 18.8% year over year. Revenues are projected to reach $161.89 million, declining 8.4% from the same quarter last year.The current level reflects a downward revision of 2.5% in the consensus EPS estimate for the quarter over the past 30 days. This demonstrates how the analysts covering the stock have collectively reappraised their initial projectio ...