Silvercrest Asset Management Group(SAMG) - 2024 Q3 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Discretionary AUM increased by $1.0 billion during the quarter to$22.6 billion, representing a 5% increase since the second quarter and a year-over-year increase of 10% since Q3 2023 [7] - Total AUM at the end of Q3 was $35.1 billion, up 13$30.4 million, an increase of approximately 2% year-over-year [15][16] - Reported net income for the quarter was $3.7 million, with adjusted net income of approximately$3.8 million [15][20] - Adjusted EBITDA was approximately $6.3 million, or 20.9$1.2 billion [10] Market Data and Key Metrics Changes - Broader market participation was noted throughout Q3, benefiting Silvercrest's diversified wealth management business and exposure to Small Cap institutional business [6] - The global equity strategy is in high demand, particularly among large families and institutions outside the U.S. [34] Company Strategy and Development Direction - The company is optimistic about securing significant organic net flows over the next two quarters due to improved business development results [6] - Investments are being made to drive future growth, including hiring more professionals to support the team and strategy [12] - The firm is focused on building infrastructure to support business development and has a robust pipeline of new business opportunities [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about future revenue increases driven by the pipeline and market conditions [6][55] - The firm is preparing for significant inflows into the global equity strategy, which is expected to enhance organic growth [36] - Management acknowledged the need for continued investment in infrastructure to support growth and maintain competitive positioning [48] Other Important Information - Total assets were approximately $184.2 million as of September 30, down from$199.6 million at the end of the previous year [26] - The company repurchased approximately $1.4 million of Class A shares during the quarter [27][44] Q&A Session Summary Question: Details on global strategies and staffing - Management confirmed that most of the primary portfolio management team for the global equity strategy has been hired, with further hiring planned [30][31] Question: Update on buyback activity and cash usage - Management indicated that buybacks are being conducted when cash is available, viewing it as a form of acquisition [39][40] Question: Long-term adjusted EBITDA margin target - Management aims to return to an EBITDA margin in the upper 20s as the business matures [45]