Financial Data and Key Metrics Changes - In 2025, the company achieved a revenue increase of 8% compared to 2024, with operating income and adjusted operating income rising by 9% and 12% respectively [4] - Assets under management (AUM) reached an all-time high of $180 billion, up nearly 12% from year-end 2024 [12] - The December 2025 quarter saw revenues of $336 million, marking an 11% increase from the previous quarter and a 13% increase year-over-year [12][16] - Adjusted operating income increased by 23% compared to both the prior quarter and the same quarter last year, with an adjusted operating margin of 40.2% [15] Business Line Data and Key Metrics Changes - The credit platform's AUM grew by 29% year-over-year to $17.9 billion, with net inflows totaling $2.8 billion [8] - The alternatives platform's AUM increased by 20% to $4 billion, driven by strong organic growth [8] - The equity platform experienced outflows of $15.6 billion, primarily from global opportunities and U.S. mid-cap growth strategies, attributed to short-term performance challenges [8] Market Data and Key Metrics Changes - 79% of AUM outperformed benchmarks over a 3-year period, 74% over 5 years, and 92% over 10 years, gross of fees [5] - The Emerging Markets Local Opportunity Strategy in credit generated a return of over 24%, outperforming its benchmark by 527 basis points [6] Company Strategy and Development Direction - The company is focused on expanding its multi-asset class platform while maintaining a high value-added investing philosophy [4] - The acquisition of Grandview Property Partners marks a strategic expansion into alternative investments and private real estate [9][10] - The company aims to leverage its institutional relationships to enhance Grandview's business and expand its investment capabilities [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in maintaining and growing equity businesses despite recent outflows, emphasizing the need for compelling investment performance [8][9] - The company anticipates continued growth in credit and alternatives, with a focus on private credit and secondaries in private equity [28][46] - Management noted that the acquisition of Grandview is expected to be mildly accretive to earnings per share after the closing of its next flagship fund [19] Other Important Information - The board declared a quarterly dividend of $1.01 per share and a special year-end dividend of 57 cents, resulting in a total dividend of $3.87 per share for 2025, an 11% increase from 2024 [18] - The company ended the year with approximately $214 million in cash and a conservative leverage ratio of 0.4 times [17] Q&A Session Summary Question: Regarding Grandview's AUM and accretion guidance - Management explained that AUM was lower due to realizations on properties in Grandview Fund I, which is in the harvesting phase [24] - Fund III had about $150 million in committed assets, and the company is actively pursuing Fund IV, expecting a first close in mid-summer [25][26] Question: On M&A opportunities and market conditions - Management highlighted a focus on private credit and secondaries in private equity, with interest in idiosyncratic opportunities within equity [28] - The company is not exclusively focused on M&A but is open to opportunities that align with its investment philosophy [28] Question: On the international value strategy and recent outflows - Management noted that outflows were primarily due to institutional reductions and not indicative of underlying issues, as the team continues to deliver strong absolute returns [37][38] Question: Interest in non-US strategies and emerging markets - Management indicated a reemergence of emerging markets allocations and success in global franchises, with significant net flows from recent campaigns [41][42][43]

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Market Trends & Macroeconomic Factors - The market is receiving mixed signals regarding the Federal Reserve's interest rate path, especially with recent CPI increases [1] - While overall inflation has been relatively tame despite tariffs, the Fed is expected to observe a few more months of data before resuming rate cuts [2] - There's uncertainty surrounding the risk of inflation spiking and upward moves in bonds, particularly with the August 1 deadline looming [4] - The market appears to be largely shrugging off these concerns, hoping for trade deals or extensions [5] Company Earnings & Valuations - Attention is being paid to how tariffs and trade are impacting company earnings and margins, though no significant impact has been observed thus far [6] - NASDAQ and S&P are near or at all-time highs, indicating markets are priced for perfection [6] - Tech stocks have seen a surge since April lows, leading to stretched valuations [8][9] - Top 10 holdings in the S&P account for a significant concentration, representing 30-38% of the index and 32% of the earnings [9] - Despite high expectations, the market wants to see continued investment in AI and capex spending on data centers and infrastructure [10] Investment Opportunities - Both public and private investments are seen as good opportunities, particularly in illiquid investments across private capital, private equity, private credit, and private real estate [12][13] - Investing in alternative asset managers could benefit if more private investments are allowed in 401ks [11] - Private equity investments offer exposure to AI companies not readily available in public markets [13]