Westwood(US:WHG)2026-02-13 22:30Financial Data and Key Metrics Changes - Total revenues for Q4 2025 were $27.1 million, an increase from $24.3 million in Q3 2025 and $25.6 million in Q4 2024, driven by investor interest in ETFs and private energy secondaries funds [15] - Fiscal 2025 total revenues reached $97.8 million, compared to $94.7 million in 2024, attributed to higher average assets under management [15] - Q4 2025 income was $1.9 million, or $0.21 per share, down from $3.7 million, or $0.41 per share in Q3 2025, and $2.1 million, or $0.24 per share in Q4 2024 [16] Business Line Data and Key Metrics Changes - The ETF franchise exceeded $200 million in assets, with the latest ETF, Enhanced Income Opportunity, contributing to this growth [4] - Managed Investment Solutions team secured its first institutional client, indicating growth in this business line [4] - The institutional channel achieved gross sales growth of 36% year-over-year, reflecting strong performance in Mid-Cap and Small-Cap Value strategies [7] Market Data and Key Metrics Changes - Firm-wide assets under management totaled $17.4 billion, with institutional assets at $8.3 billion, wealth management assets at $4.3 billion, and mutual fund assets at $3.9 billion [17] - The company experienced net outflows of $1 billion in assets under management, offset by $1 billion in market appreciation [18] - The company reported a solid financial position with cash and liquid investments totaling $44.1 million and a debt-free balance sheet [18] Company Strategy and Development Direction - The company is focused on high-quality businesses with strong fundamentals, positioning itself well for future market uncertainties [6] - A disciplined, multiyear evolution of the wealth division is underway, aimed at enhancing client experience and scalability [11] - The launch of new strategies, including the Westwood Enhanced Income Opportunity ETF, is part of the company's strategy to expand its product offerings [11] Management's Comments on Operating Environment and Future Outlook - Management acknowledged disappointing outflows in Q4, primarily from the Large Cap Value product, which has struggled in a narrow market environment [22] - The company remains optimistic about its pipeline, with new clients and significant funding expected in the near future [22] - Management expressed confidence in the strategic positioning and value proposition of the company moving forward [13] Other Important Information - The board approved a regular cash dividend of $0.15 per common share, payable on April 1, 2026 [18] - The company closed its second oversubscribed private equity fund with over $300 million in commitments, indicating strong capital-raising capabilities [12] Q&A Session Summary Question: What are the reasons for the outflows in Q4? - Management noted that over 80% of the outflows were from the Large Cap Value product, which has struggled against a low-quality market environment [22] Question: What is the outlook for new client acquisitions? - Management highlighted a new client bringing in $200 million and a defined contribution plan expected to fund $450 million, indicating a strong pipeline [22] Question: How is the company positioned for future growth? - Management expressed bullishness on the ETFs launched in recent years and the overall growth strategy, emphasizing the importance of high-quality investment solutions [24]