Q4 2023 AlTi Global Inc Earnings Call

Please standby we're about to begin.

Operator: Standby, we're about to Good afternoon. My name is Beau, and I will be your conference operator for today. At this time, I would like to welcome everyone to 2023.

Good afternoon. My name is Beau and I will be your conference operator for today at this time I would like to welcome everyone to <unk> fourth quarter and full year 2023 earnings conference call. During the call. Your lines will remain in a listen only mode. After the Speakers' remarks, there will be a question and answer session I'd like to advise all parties at this conference.

Lily Arteaga: During the call, your lines will remain on the list. Question and Answer Session I'd like to advise all parties, Now at this time, I'll turn things over to Lily Arteaga, Head of, Good afternoon to everyone on the call today. Joining me this afternoon are Michael Tiedemann, our CEO, and Stephen Yarad, our CFO. We invite you to visit the Investor Relations section of our website at www.alti-global.com to view our earnings materials, including our updated investor presentation. I would like to remind everyone that certain statements made during the call may be deemed forward-looking statements within the meaning of the Private Security Litigation Reform Act of 1995. Forward-looking statements can be identified by the use of words such as anticipate, believe, continue, estimate, expect, future, intend, may, plan, and will, or similar words.

<unk> call is being recorded and a replay of the webcast is available on <unk> Investor Relations website. At this time I'll turn things over to Billy Archaeology head of Investor Relations for <unk>. Please go ahead ma'am.

Good afternoon to everyone on the call today joining me. This afternoon are Michael Freedman, our CEO and Stephen Gary Our CFO.

We invite you to visit the Investor Relations section of our website at Www Dot Oh, gosh global Dot com.

Our earnings materials, including our updated investor presentation I.

I would like to remind everyone that certain statements made during the call maybe deemed forward looking statements within the meaning of the private Securities Litigation Reform Act of 1995.

Forward looking statements can be identified by the use of words, such as anticipate believe.

Tim you.

Estimate.

Correct future intend may.

Plan and will or similar words.

Lily Arteaga: Because these forward-looking statements involve both known and unknown risks and uncertainties, there are important factors that could cause actual results to differ materially from those expressed or implied by these forward-looking statements. The Company also assumes no obligation or responsibility to update any forward-looking statements. During this call, some comments may include references to non-GAAP financial measures. Full reconciliations can be found in our earnings presentations and our related SEC filings. As I mentioned, we filed an updated investor presentation earlier today. With that, I'd like to turn the call over to Mike. Thank you, Lily.

Because these forward looking statements involve both known and unknown risks and uncertainties.

Factors that could cause actual results to differ materially from those expressed or implied by these forward looking statements.

<unk> assumes no obligation or responsibility to update any forward looking statements.

During this call. Some comments may include references to non-GAAP financial measures for reconciliations can be found in our earnings presentation and our related SEC filings.

Mentioned, we filed an updated investor presentation earlier today with that I'd like to turn the call over to Mike.

Thank you Louise.

Michael Glenn Tiedemann: Good afternoon, everyone, and thank you for joining us today for our fourth quarter and full year 2023 earnings call. 2023 was a pivotal year for the All-Heat team. In January of last year, we completed a business combination that brought three companies together and culminated in our listing as a public company. Concurrent with the closing, we secured a $250 million credit facility, and in the second quarter, we increased our share liquidity and float through the registration of the pipe shares, as well as the successful completion of a warrant exchange. We also conducted a comprehensive strategic review of the newly combined operating structure. Through that process, we identified and implemented $16 million in annualized run rate cost savings initiatives.

Good afternoon, everyone and thank you for joining us today for our fourth quarter and full year 2023 earnings call.

2023 was a pivotal year for the off you'd seen.

In January of last year, we completed a business combination, which brought three companies together and culminated in our listing as a public company.

With the closing we secured a $250 million credit facility and then the second quarter, we increased our share liquidity and float through the registration of the pipe shows as well as the successful completion of a warrant exchange.

We also conducted a comprehensive strategic review of the newly combined operating structure.

Through that process, we identified an action 16 million in annualized run rate cost savings initiatives.

We expect that these cost savings will be fully realized in our Q3 'twenty 'twenty four results.

Michael Glenn Tiedemann: We expect that these cost savings will be fully realized in our Q3 2024 results. As a firm, we completed key transactions across both of our business segments, wealth management and strategic alternatives. This included expanding our footprint in key markets like Singapore and Northern Italy and increasing our stake in managers of uncorrelated alternative strategies, which should continuously outperform their benchmark. A few weeks ago, we announced a strategic investment from Allianz X and Constellation Wealth Capital, or CWC.

As a firm.

We completed key transactions across both of our business segments wealth management and strategic alternatives.

This included expanding our footprint in key markets like Singapore, and Northern Italy.

And increasing our stake in managers of uncorrelated alternative strategies, which continuously outperformed their benchmarks.

A few weeks ago, we announced a strategic investment from Zacks and constellation wealth capital or CWC.

Michael Glenn Tiedemann: Upon closing, this transaction will provide AltE with up to $450 million to execute on our strategic priorities. We have a robust, actionable M&A pipeline and believe these relationships will lead to significant momentum. We have a clear path to organic growth through new client wins, given the expanded depth of resources, network, and talent which these partners bring.

Upon closing this transaction will provide <unk> with up to 450 million to execute on our strategic priorities.

We have a robust actionable M&A pipeline.

I believe these relationships will lead to significant momentum.

We have a clear path to organic growth through new client wins, given the extended depth of resources network and talent.

These partners bring.

Michael Glenn Tiedemann: I'll expand more on this transaction after we review our operational and financial results. In 2023, we grew our total assets under management and advisement by 10%, mostly driven by portfolio performance and organic client growth and wealth management. Total assets in that business segment grew by nearly 20% in the year. In the fourth quarter, ALTI generated revenues of $92 million, and for the full year, we recorded revenues of $251 million. Notably, Seventy-seven percent of revenues in the year were recurring for management and advisory functions.

I'll expand more on this transaction after we review our operational and financial results.

In 2023, we grew our total assets under management and advisement by 10%, mostly driven by portfolio performance.

Organic client growth in wealth management.

Total assets in that business segment grew by nearly 20% in the year.

In the fourth quarter.

<unk> generated revenues of $92 million and for the full year, we recorded revenues of $251 million.

Notably.

77% of revenues in the year were recurring from management and advisory fees.

Michael Glenn Tiedemann: The fourth quarter reflected incentive fees primarily from the robust performance of the event-driven strategy in our strategic alternative segment. However, despite these strong top-line results, our gap results were impacted primarily by decisions taken to restructure or exit unprofitable, transaction-oriented businesses in our strategic alternative segment. Consequently, we reported a loss of $319 million for the full year of 2025. We do not anticipate further significant impairments in 2024, as much of the work to streamline non-core operations is behind us, and our focus is to further invest in core operations that demonstrate strong recurring revenue fundamentals. Normalized for one-off items, our adjusted net loss was $8 million for the year.

The fourth quarter reflected incentive fees, primarily from the robust performance of the event driven strategy and our strategic alternatives segment.

Despite these strong top line results. Our GAAP results were impacted primarily by decisions taken to restructure or exit unprofitable transaction oriented businesses and our strategic alternatives segment.

Consequently, we reported loss of $319 million for the full year of 2023.

We do not anticipate further significant impairments in 'twenty 'twenty four is most of the work to streamline noncore operations is behind us and our focus is to further invest in core operations demonstrates strong recurring revenue fundamentals.

Normalized for one off items, our adjusted net loss was 8 million for the year.

Michael Glenn Tiedemann: Quarter over quarter, Adjusted EBITDA improved $13 million to $10 million for the fourth quarter. And for the full year, Adjusted EBITDA was $29 million. We believe our performance in the fourth quarter demonstrates the power of our diversified platform across wealth management and strategic terms. In wealth management, we had a record year of growth in the U.S., driven by market performance, where we had a risk-on bias, given our view that the U.S. would achieve an economic soft landing, as well as organic asset growth resulting from a combination of our business development efforts and asset increases from our existing clients. Internationally, the wealth segment benefited from the integration of the legacy businesses as well as the Singapore acquisition and the increased stake in the Honour-based multifamily office. As anticipated, our strategic alternatives segment generated robust incentive fees in the fourth quarter, resulting from the strong performance of the event-driven strategy, which was up 5.4% in the quarter and 10.5% for the year. This marked the 30th consecutive year of positive performance for the strategy, a remarkable achievement.

Quarter over quarter, adjusted EBITDA improved 13 million to 10 million for the fourth quarter and.

For the full year adjusted EBITDA was $29 million.

We believe our performance in the fourth quarter demonstrates the power of our diversified platform across wealth management and strategic alternatives.

In wealth management, we had a record year of growth in the U S driven by market performance, where we had a risk on by us.

Given our view that the U S would achieve an economic soft landing as well as organic asset growth, resulting from a combination of our business development efforts and ASIC increases from our existing clients.

Internationally, the wealth segment benefited from the integration of the legacy businesses as well as the Singapore acquisition and the increased stake in the AMA based multifamily office.

As anticipated our strategic alternatives segment generated robust incentive fees in the fourth quarter.

Resulting from the strong performance of event driven strategy, which is up five 4% in the quarter and 10, 5% for the year.

This marked the 30th consecutive year of positive performance for the strategy a remarkable achievement.

This healthy performance not only benefits 2023 results, but also creates positive momentum for fundraising in 2024.

Michael Glenn Tiedemann: This healthy performance not only benefits 2023 results but also creates positive momentum for fundraising in 2024. We are encouraged by indications of investor interest in the Inventory Driven Strategy, as well as our Asia Credit Strategy. Credit Strategies, gaining traction due to its strong relative performance compared to the Asia High Yield Index, initial expectations of a recovery in that region and the growing depth of the Asian credit market. Additionally, after several quarters of abated activity in real estate given the rising rate environment,

We are encouraged by indications of investor interest in the event driven strategy as well as our Asia credit strategy.

Our credit strategy is gaining traction because of its strong relative performance compared to the ease of high yield index initial expectations of a recovery in that region and the growing depth of the Asia credit markets.

Additionally, after several quarters of abated activity in real estate, given the rising rate environment.

Michael Glenn Tiedemann: I'm very pleased to report that our private real estate team arranged a purchase of the GlaxoSmithKline Corporate Headquarters in London by an investor, which will be an important restoration and repurposing project. For our role in structuring the deal, we earned a resignation fee in the quarter, and, importantly, we will receive recurring management fees going forward. To summarize, last year we achieved several operational milestones as the year was centered on internal strategic initiatives. This included the integration of our legacy businesses, reinforcing our focus on recurring revenues, streamlining entities, improving core operations, and establishing best practices throughout the organization. With those initiatives taking hold, in 2024, our focus will be on external action.

I'm very pleased to report that our private real estate team arrange the purchase.

Of the Glaxo Smithkline corporate headquarters in London, an Investor group, which.

This will be an important restoration and Repurposing project.

For our role in structuring the deal you're on the origination fee in the quarter and importantly, we will receive a recurring management fees going forward.

To summarize last year, we achieved several operational milestones as the year was centered on inward strategic initiatives.

This included the integration of our legacy businesses.

Reinforcing our focus on recurring revenues.

Streamlining entities, improving cooperations and establishing best practices throughout the organization.

So those initiatives taking hold in 2024, our focus will be on external action.

Michael Glenn Tiedemann: We are confident that our solid foundation will enable us to accelerate momentum to profitable organic and inorganic growth globally across both of our segments. Another key priority this year will be raising ALPSI's profile in the capital market. This will include evaluating opportunities to increase our float, driving investor community interest, and ultimately attracting long-term institutional investors. To that end, we were pleased to recently announce the strategic relationship with Allianz X and CWC, a transformative transaction platform. These investments, which total up to $450 million, will support our strategy to become the leading global independent multifamily office for the ultra-high net worth segment with a targeted expertise in Altru. Importantly, these relationships enable Alt-T to establish long-term partnerships with experienced and well-respected players in the global financial services sector.

We're confident that our solid foundation will enable us to accelerate momentum to profitable organic and inorganic growth globally across both of our segments.

Another key priority this year will be raising <unk> profile and the capital markets.

This will include evaluating opportunities to increase our increase our floats.

Driving investor community interests, and ultimately attracting long term institutional investors.

To that end, we were pleased to recently announce the strategic relationship with <unk> and CWC, a transformative transaction policy.

These investments, which totaled up to 450 million will support our strategy to become the leading global independent multifamily office for the Ultra high net worth segment with the targeted expertise in alternatives.

Importantly, the relationships enable all seem to establish long term partnerships with experienced and well respected players in the global financial services sector.

We believe we can expand and fortify altice global footprint in key markets and execute on strategic acquisitions through disciplined deployment of this gross capital.

Michael Glenn Tiedemann: We believe we can expand and fortify Alti's global footprint in key markets and execute on strategic acquisitions through the disciplined deployment of this growth cap. We plan to deepen Alti's reach and expand within our current market. We also seek to enter new markets in the United States, Europe, and Asia, where we can grow our client base, as well as enhance our service offering to existing clients across multiple jurisdictions. As a global operation with local presence across 21 financial centers, Altsy is uniquely positioned to serve single-family offices.

We plan to deepen all these reach and expand within our current markets.

We also seek to enter new markets in the United States, Europe, and Asia, where we can grow our client base as well as enhance our service offering to existing clients across multiple jurisdictions.

As a global operation with local presence across 21 financial centers.

<unk> is uniquely positioned to serve single family offices.

Michael Glenn Tiedemann: Our platform provides significant benefits to the investment and administrative teams who serve large families by enabling them to leverage our global infrastructure, scale, resources, deal flow, and regulatory compliance while significantly reducing overall costs. These benefits will only be enhanced by the partnerships with Allianz and Constellation. Additionally, we will capitalize on our organic growth initiative. There is a clear opportunity to expand revenue and lead generation opportunities across a larger and more globally diverse client base. All-T can expand its tailored solution set through co-investment opportunities across alternative, impact investment strategies, and, when appropriate, partnering with Allianz to structure bespoke solutions.

Our platform provides significant benefits to the investment and administrative teams, who serve large families, but enabling them to leverage our global infrastructure scale resources deal flow, while significantly reducing overall costs.

These benefits will only be enhanced by the partnerships with all the Hudson constellation.

Additionally, we will capitalize on organic growth initiatives, there is a clear opportunity to expand revenue and lead generation opportunities across a larger and more globally diverse client base.

<unk> can expand its tailored solution set through the co investment opportunities across alternatives impacts investment strategies and when appropriate partnering with Allianz structured bespoke solutions.

Finally accretive M&A will be fundamental to our go forward strategy.

Michael Glenn Tiedemann: Finally, creative M&A will be fundamental to our go-forward strategy. We anticipate future transactions will be a significant driver of top-line growth and margin expansion as we build off the existing platform. As I mentioned, we've identified a robust M&A pipeline, and this infusion of growth capital positions us to continue our track record of attractive, profitable deals across both alternatives and wealth. We always take a disciplined approach to our pipeline and acquisition criteria and consider the target's profile.

We anticipate future transaction will be a significant driver of topline growth and margin expansion as we build off the existing platform.

As I mentioned, we've identified a robust M&A pipeline.

This infusion of growth capital positions us to continue our track record of attractive profitable deals across both alternatives and wealth.

We always take a disciplined approach to our pipeline and acquisition criteria and consider the targets profile footprint.

Michael Glenn Tiedemann: Footprint, and Operational Fit as it relates to Alt-E's positioning in the market. These partnerships enhance LT's current strength to further differentiate the firm from the competition as client demands continue to evolve. As we've indicated, of the total of investment to be made by CWC, which is $150 million, $115 million is projected to close in the coming weeks. As such, we expect to begin executing on our pipeline in the short term.

Foot print and operational fit as it relates to <unk> positioning in the marketplace.

These partnerships enhance <unk> current strengths to further differentiate the firm from the competition as client demands continue to evolve.

As we've indicated of the total of investment to be made by CWC, which is $150 million.

$115 million is projected to close in the coming weeks.

Such we expect to begin executing on our pipeline in the short term.

Michael Glenn Tiedemann: We will update you on the progress in a timely manner. This was an important year for our organization, and we're excited about what Alt-T can accomplish in 2024. As we onboard strategic partners, deploy growth capital, and expand our global footprint, we are positioning the platform for long-term success. We look forward to demonstrating how our strategic priorities will lead to accelerated growth, profitability, and, notably, create sustainable shareholder value. With that, I'll turn the call over to Steve to provide further details of our financial results. Thank you, Mike.

We will update you on our progress in a timely manner.

This was an important year for our organization and we're excited about what else. He can accomplish in 2024.

As we onboard strategic partners deploy growth capital and expand our global footprint we.

We're positioning the platform for long term success.

We look forward to demonstrating how our strategic priorities will lead to accelerated growth profitability, and notably create sustainable shareholder value.

That I will turn the call over to Steve to provide further details of our financial results.

Thank you Mike.

Stephen D. Yarad: Last year we achieved many milestones that have already set the stage for continued top-line growth in 2024 and importantly increased profitability in the years to come. Before we review the results, I want to note the results in our regulatory filings are presented as a comparison between predecessor and successor companies, as required by the accounting guidelines. In our case, Tiedemann Wealth Management Holdings is the predecessor company, and Altii is the successor.

Last year, we achieved many milestones that have already set the stage for continued topline growth in 2024, and importantly increased profitability in the years to come.

Before we review the results I want to note the results in our regulatory filings are presented as a comparison between predecessor.

Success of companies as required by the accounting guidelines.

In our case Tiedemann wealth management Holdings is the predecessor company and all T is a successor.

Stephen D. Yarad: As such, the year-over-year results are not directly comparable, and my comments will be focused primarily on the quarter-over-quarter comparison. Multi-generated revenues of $92 million in the fourth quarter, up 86% in the third quarter, driven primarily by incentive fees generated in our strategic alternative segment. The strong top-line performance in the quarter also reflected increased management fees driven by the growth in AUM and AUA in the quarter and the realization of incentive fees in our wealth management segment and High Origination Fees in our Strategic Alternative Segment. Given the significant incentive fee recorded in the quarter, recurring revenues were approximately 53% of total revenues in the fourth quarter. All year 2023 revenues were $251 million.

As such the year over year results are not directly comparable and my comments will be focused primarily on a quarter over quarter comparisons.

<unk> generated revenues of $92 million in the fourth quarter up 86% from the third quarter.

Primarily by incentive fees generated in our strategic alternative segment.

The strong top line performance in the quarter also reflected.

Increased management fees driven by the growth in <unk>.

In the quarter and the realization of incentive fees in our wealth management segment and higher origination fees and a strategic alternative segment.

Given the significant incentive fee recorded in the quarter recurring revenues were approximately 53% of total revenues in the fourth quarter.

Full year 2023 revenues with $251 million.

Stephen D. Yarad: 77% of which reflect recurring revenues from management and advisory fees. These results highlight the diversification and strength of our platform, which we anticipate will continue to strengthen in 2024. Revenues in our wealth management segment increased 9% sequentially to $38 million in the fourth quarter, reflecting 5% growth in assets resulting from robust market performance and net client wins, as well as incentive fees recorded in the period. For the full year 2023, revenue from the Wealth Management Segment was $138 million.

77% of which reflect recurring revenues from management and advisory fees.

These results highlight the diversification and strength of that platform, which we anticipate will continue to strengthen in 2024.

Revenues in our wealth management segment increased 9% sequentially to $38 million in the fourth quarter, reflecting 5% growth in assets, resulting from robust market performance and net client wins as well as incentive fees recorded in the period.

For the full year 2023.

Wealth management segment revenue was $138 million.

Stephen D. Yarad: And importantly, recurring revenues in the segment were 95% and 99% for the quarter and the year, respectively. In our strategic alternative segment, revenue totaled $54 million in Q4, an increase of $40 million compared to the prior quarter, largely driven by crystallized incentive fees associated with the event-driven strategy. The origination fee related to the London real estate deal also contributed to segment results in the quarter. For the full year 2023, Strategic Alternative Segment revenue was $113 million.

Totally recurring revenues in the segment with 95% and 99% for the quarter and the year respectively.

Now strategic alternative segment.

Revenue totaled $54 million in Q4, an increase of $40 million compared to the prior quarter.

It's driven by crystallized incentive fees associated with the event driven strategy.

The origination fee related to the London Real estate deal also contributed to segment results in the quarter.

For the full year 2023 strategic alternatives segment revenue was $113 million.

52% of this top line performance was from recurring management and advisory fees, including distributions from our <unk> platform.

Stephen D. Yarad: 52% of this top-line performance was from recurring management and advisory fees, including distributions from our alternatives platform. Despite pleasing progress in the top-line results, we recorded a net loss of $87 million in the fourth quarter, reflecting $51 million of impairment and other charges in our strategic alternative segment, higher incentive compensation accruals, as well as certain other expenses which we expect to be non-recurring. Normalized for one-off items, our adjusted net loss in the fourth quarter was $6 million.

Slight pleasing progress in the topline results, we recorded a net loss of $87 million in the fourth quarter.

Reflecting $51 million of impairment and other charges and a strategic alternative segment.

Higher incentive compensation accruals as well as certain other expenses, which we expect to be nonrecurring.

Normalized for one off items, our adjusted net loss in the fourth quarter was $6 million.

$34 million of impairment charges related to the termination of that management contract for LSI U K based publicly traded right.

<unk> was Alex size budget with London metric, which was completed earlier this month.

Stephen D. Yarad: $34 million of the impairment charges related to the termination of our management contract for LXI, the UK-based publicly traded REIT, in connection with LXI's merger with London Metric, which was completed earlier this month. In connection with the merger, we agreed to terminate the management contract for an initial payment of $32 million and potential future payments of up to £4 million, depending on London Metric's future performance. The impairment charge recorded essentially reflects the difference between the initial consideration received and the carrying value of the intangible asset for the management contract that was recorded prior to the transaction.

In connection with the merger we agreed to terminate the management contract for initial payment of $32 million and potential future payments of up to 4 million pounds.

Pending on London metrics future performance.

The impairment charge recorded essentially reflects the difference between the initial consideration received and the carrying value of the intangible asset for the management contract that was recorded prior to the transaction.

I would like to note that Alex I contributed $2 3 billion to AUM.

M at year end.

Following the sale in early March will no longer be reflected in our assets at the end of the first quarter.

So the $17 million of impairment and other charges were recorded related to that private real estate business, reflecting restructured arrangements with several partners, which resulted in adjustments to amounts recorded certain equity method investments carried interest and other receivables deemed uncollectible.

Stephen D. Yarad: I would like to note that LXI contributed $2.3 billion to AUM at year-end, which, following the sale in early March, will no longer be reflected in our assets at the end of the first quarter. In addition, $17 million of impairment and other charges were recorded related to our private real estate business, reflecting restructured arrangements with several partners which resulted in adjustments to amounts recorded for certain equity method investments, carried interest, and other receivables deemed non-collectible. Normalized operating expenses for the fourth quarter, which exclude non-cash compensation, expenses related to severance costs, depreciation, and amortization, and certain transaction and deal-related expenses, were $82 million. This represents an increase of $30 million compared to the prior quarter, primarily driven by the higher incentive compensation accrual recorded in the fourth quarter, largely due to the strong performance of the event-driven strategy. Excluding compensation expenses, normalized operating expenses were lowered by $2 million.

Normalized operating expenses for the fourth quarter, which exclude non cash compensation expenses related to severance costs depreciation and amortization.

And certain transaction and deal related expenses were $82 million.

This represents an increase of $30 million compared to the prior quarter.

Primarily driven by the higher incentive compensation accrual recorded in the fourth quarter.

Actually attributed to the strong performance of event driven strategy.

Excluding compensation expenses normalized operating expenses were lower by $2 million.

Fourth quarter, adjusted EBITDA was $10 million, an increase of $13 million compared to the third quarter driven by higher incentive fees.

We offset by the related incentive compensation accrual.

Our adjusted EBITDA margin improved to 11% in Q4.

On a full year basis, adjusted EBITDA was $29 million.

And our adjusted EBITDA margin was 12%.

As growth and cost savings initiatives take hold in 2024, including nice, resulting from the strategic investments by <unk> and CWC.

Stephen D. Yarad: Fourth quarter adjusted EBITDA was $10 million, an increase of $13 million compared to the third quarter, driven by higher incentive fees, partly offset by the related incentive compensation accrual. On a four-year basis, our adjusted EBITDA was $29 million, and our adjusted EBITDA margin was 12%.

We expect to see the impact of operating leverage to drive improvements and greater consistency in our GAAP results and adjusted EBITDA.

Given that the Allianz X transaction is subject to regulatory approvals, which may take several months to obtain we are reserving any updates to our financial targets until later this year.

After that investment has caused.

With that I will turn it back to Mike for concluding remarks.

Stephen D. Yarad: As growth and cost savings initiatives take hold in 2024, including those resulting from the strategic investments by Allianz X and CWC, we expect to see the impact of operating leverage, drug improvements, and greater consistency in our GAP results and adjusted EBITDA. Given that the Allianz X transaction is subject to regulatory approvals, which may take several months to obtain, we are reserving any updates to our financial targets until later this year, after that investment is completed. With that, I will turn it back to Mike for his concluding remarks. Thank you, Steve.

Thank you Steve.

We entered 2024 with incredible momentum on the heels of executing several key components of our strategic plan.

I am proud of our team and appreciate all of the hard work for them, particularly since our listing to get us to where we are today.

I'm confident that this progress combined with the valuable partnerships, we've established position I'll tee to deliver long term profitable growth in the years to come.

Finally, we want to thank our global client base, who put their trust not seeing day in day out.

We're grateful for your support and look forward to working with you in the year ahead.

Michael Glenn Tiedemann: We enter 2024 with incredible momentum on the heels of executing several key components of our strategic plan. I'm proud of our team and appreciate all of the hard work they've put in, particularly since our listing, to get us to where we are today. I'm confident that this progress, combined with the valuable partnerships we've established, positions all to deliver long-term profitable growth in the years to come. Finally, we want to thank our global client base who put their trust in our team day in and day out. We're grateful for your support and look forward to working with you in the year ahead. With that, we'd like to now open up the call for questions. Operator.

With that we'd like to now open up the call for questions.

Later.

Thank you Mr Tiedemann, ladies and gentlemen at this time, if you would like to ask a question simply press star one on your telephone keypad, you may remove yourself from the queue at any time by pressing star to again star one to ask a question and we'll pause for just one moment to allow questions to queue.

Well go first this afternoon to Wilma burtis of Raymond James.

Hey, good afternoon, everyone.

Can you discuss the relative attractiveness of the wealth management deals versus asset management deal with especially as you're going into plenty of potential deployments. This year.

Thank you we'll move.

Operator: Thank you, Mr. Tiedemann. Ladies and gentlemen, at this time, if you would like to ask a question, simply press star 1 on your telephone keypad. You may remove yourself from the queue at any time by pressing star 2.

So.

First of all it's important to highlight that there are.

Both strategic and accretive deals.

And both business lines.

They offer.

Some cases expansion geographically some cases.

Wilma Carter Jackson Burdis: Again, use Star 1 to ask a question, and we'll pause for just one moment to allow questions. We'll go first this afternoon to Wilma Burdis of Raymond. Hey, good afternoon, everyone. Could you discuss the relative attractiveness of the wealth management deals versus asset management deals, especially as you're going into plenty of potential deployments this year? Thank you, Wilma. So, first of all, it's important to highlight that there are both strategic and accretive deals in both business lines, and they offer, in some cases, expansion geographically, in some cases, a deepening of the product offering in the case of strategic alternatives. So they really do vary in terms of... there is specific relevance for the business. All of them are in valuation ranges that we believe can be driven from start to when you look forward three or four years from the standpoint that we expect these to be growth investments that we're making in businesses that we believe collectively we will be able to grow, whether that be a wealth, a new jurisdiction or a deepening of a market that we're already in But they, so all of them bring that component.

Deepening of the product offering in the case of strategic goals.

So they really do vary in terms of.

There are specific relevance for <unk> for the business lines.

All of them.

And valuation ranges that we believe.

Can be driven from starting too when you look forward three or four years from the standpoint that these we expect these to be growth investments that we're making in the businesses that we believe collectively we will be able to grow whether that be a wealth.

A new jurisdiction or a deepening of the market's already in.

But.

So all of them bring that component.

And then the valuations really vary based on.

Everything you would imagine so.

Prior growth rates scale of the business margins of the business our view on our ability to drive that business and drive margins going forward and then.

Anything perhaps that is additive strategically as well.

Got it. Thank you and maybe you could just touch on why you guys decided to change the name of the asset management segment.

Strategic alternatives is.

Michael Glenn Tiedemann: And then the valuations really vary based on these. Everything you'd imagine it to be. So prior growth rates, scale of the business, margins of the business, our view of our ability to drive that business and drive margins going forward, and then anything perhaps that is additive strategic. Thank you. And maybe you could just touch on why you guys decided to change the name of the asset management segment. Strategic Alternatives is much more related to the underlying businesses that we are investing in and have been managing. We believe there's also a great tie with the wealth segment from the standpoint of these are long-term trends that ultimately have a lot of tailwinds but are segments of the marketplace that we feel any long-term pool of capital would be investing in there, whether that be a large family, an endowment foundation, multi-generational pools of capital want to be and will be investing in these areas. And so this, but it is more targeted and more specifically oriented around all.

Much more related to.

The underlying businesses that we are investing in.

<unk> been managing we believe there is also a great tie with the wealth segment from the standpoint of these are long term.

Trends.

Ultimately you have a lot of tailwind, but our segments of the marketplace that we feel.

Any long term pool of capital would be investing in them, whether that'd be a large family.

And the Darwin Foundation, multi generational pools of capital want to be and we'll be investing in these areas.

So this but it is more targeted and more specifically oriented around alternatives. So we felt the labeling of that was much more in tune with our underlying business.

Thank you.

And.

Could you talk a little bit about the outlook for operating expenses in 2004, I know you guys mentioned that it's going to be a little bit tough to give guidance for this year given all of that.

Ranges you have going on with the Oems investment.

Maybe talk a little bit about that and the trajectory. Thanks.

Sure Hi, Steve Yeah, Eric how are you.

Michael Glenn Tiedemann: So we felt the labeling of that was much more in tune with our underlying. Thank you, and could you talk a little bit about the outlook for operating expenses in 2024? I know you guys mentioned that it's gonna be a little bit tough to give guidance for this year, given all the... changes you have going on with the Allianz investment. But maybe just talk a little bit about that and the trajectory. Thanks. Sure. Hi Wilma, it's Steve Yarad. How are you?

Okay, well how are you. Good. Thank you. So look in terms of operating expenses, we are continuing to make progress.

As we've talked about before we.

Implementing the plans to deliver $60 million cost savings on an annualized basis and that's working through.

And we think that will be fully realized.

In the third quarter of next year in the second half of next year.

In terms of this quarter.

Excluding compensation.

Stephen D. Yarad: In terms of operating expenses, we're continuing to make progress. As we've talked about before, we are implementing the plans to deliver $16 million of cost savings on an annualized basis, and that's working. We think that will be fully realized in the third quarter of next year, the second half of next year. In terms of this quarter, excluding compensation, normalized operating expenses were down a little bit, which we're really pleased with. Comp was up, but primarily revenue-driven, formulaic, the compensation's formulaic based on revenue in the event-driven business, so away from that, we were sort of down a little bit quarter over quarter, which was pleasing for us, you know, big operating expenses as we move ahead. Thank you.

Normalized operating expenses were down a little bit, which we're really pleased with comp was couple is up but primarily revenue driven formulaic. Yes. The competition is formula based on revenue in the event driven business life.

Away from that.

Dan a little bit quarter over quarter, which was pleasing for us so.

We continue to.

Move forward and continue to work on professional fees.

Types of things, we do think that there's opportunities to further reduce.

Yes.

Operating expenses as we move ahead.

Got it thank you and could you talk a little bit about the.

Net client flows in the wealth management segment.

Sure. So I think in the U S business, we had some really pleasing flows for the fourth quarter market, driven probably up around 5%, 6% in the quarter.

Stephen D. Yarad: And could you talk a little bit about the net client flows in the wealth management segment? Sure, so I think in the U.S. business, we had some really pleasing flows for the fourth quarter. You know, market-driven, probably up around 5-6% in the quarter. Internationally, it was sort of flattish, but some good flows in certain areas.

Internationally, it was sort of flattish, but some good flows in certain areas. So those are all still pretty pleasing.

Yes, pretty much driven by market performance quarter over quarter.

Gotcha.

Stephen D. Yarad: So, you know, overall still pretty pleasing, but pretty much driven by market performance quarter over quarter. So mostly market performance, not necessarily a big volume of winds in the quarter. Yeah, more market-driven, that's right. And important, Wilma. You have the prospect. Process, and then conversion to.

Michael Mark at the farm is not necessarily.

I think volume of wins in the quarter.

Yes, it's more market driven that's right.

Important.

You have the prospect process.

And then conversion to clients moving into asset and billing on assets does take time so.

Transcription Outsourcing, LLC: Transcripts provided by Transcription Outsourcing, LLC. Prospecting and Verbal Wins with Clients, for that to materialize into contractual and then the assets moved in and fully built does take some time, so we're very happy with the pipeline that we have globally to go in. Thank you. And I think you guys highlighted some impairments on real estate. Could you maybe just go into a little bit more detail on that, what the drivers were?

Can have a very good quarter from the standpoint of prospecting.

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So that tends to materialize the contractual and then the assets moved in and fully build does take some time so.

We're very happy with.

Pipeline that we have globally and the opportunities that we continue to see as we go into 2024.

Yeah.

Thank you and I think you guys had highlighted some impairments on real estate could you maybe just go into a little bit more detail on that.

The drivers were.

Sure.

So as we got into the fourth quarter, we did some research and some further restructuring we've been repositioning the business to some degree.

Stephen D. Yarad: As we got into the fourth quarter, we did some further restructuring. We've been repositioning the business to some degree throughout all of 2023. Particularly in the second half, as we work through and try to simplify the business and restructure some arrangements with some of the partners, it has led to those arrangements, as they get restructured, the need to write down some carried interest receivables, which wouldn't necessarily... wouldn't be recoverable going forward and also on equity method investments. So there was about $17 million of impairment losses on those two items during the quarter.

Throughout all of 2023, but particularly in the second half.

Yes.

As we work through and try to simplify the business and restructure some arrangements with some of the partners.

It has it has led to.

Those arrangements as they get restructured the need to write down some carried interest receivables, which wouldn't be necessarily.

It wouldn't be.

Comparable going forward and also an equity method investment so it was about $17 million.

Payments on those two items during the quarter.

Stephen D. Yarad: And we really don't think that that's going to be a feature of the results going forward. We've done a lot of work on that over the past six months or so, and we think most of that's behind us now. So we wouldn't expect those types of impairments in the results in the first quarter and beyond.

Yes, we really don't think that that's gonna be feature of the results going forward. We've done a lot of work on that over the past.

Six months or so and we think that most of that's behind US now so we wouldn't expect that.

Subsequent payments in the results.

In the first in the first quarter and beyond.

Yeah.

Okay, and then maybe just give a little bit of color on.

Michael Glenn Tiedemann: And then maybe just give a little bit of color on the M&A, The Merger Arbitrage Fund, and the outlook and just the environment for that business. Well, the event-driven strategy just completed its... 30th year of profitable performance, which is really an amazing, and I reference that because it really is an amazing. History, teams worked together for a very long time.

M&A.

Merger arbitrage on the outlook and just the environment for that business.

Well the event driven strategy has just completed its.

<unk> year of profitable performance, which is really an amazing I referenced that really is an amazing.

History and the teams worked together for a very long time.

Michael Glenn Tiedemann: The, The environment is, is it, I would say, a good environment in terms of the fact that deals are being announced, there's, you know, interest rates having leveled off, you know, mid-year last year, have at least allowed financial projections and modeling to be done for businesses. So then people, CFOs, and management teams are able to make strategic decisions. Decisions and begin to move deals forward. However, the event environment is off to a slightly slower start than the team expected. Spreads are, I would say, average from where they've been historically, and we are hopeful that the deal flow will continue to pick up. But you continue to see some regulatory and political interference at times, which creates volatility in the system.

The environment is.

Is it I would say a good environment in terms of the fact that deals are.

Being announced there is interest rates, having local level off mid year last year.

At least allowed financial projections and modeling to be done for businesses. So then people are cfos and management teams were able to make strategic.

Decisions and begin to move deals forward.

The <unk>.

Environment is off to a slightly slower start than the team expected spread.

Spreads are I would say average from where they've been historically.

So we are hopeful that the deal flow will continue to pick up.

You continue to see some regulatory.

Political.

If you're at the times, which creates volatility in the space, but beyond that I would say it sort of will track to a standard year for the strategy.

Michael Glenn Tiedemann: But beyond that, I would say we'll track to a standard year. All right, thank you. Have a good evening. Thanks, Wilma. Thank you, Wilma. Thank you. And just a quick reminder, ladies and gentlemen, if you have any further questions this afternoon, please press star. Gentlemen, it appears we have no further questions this afternoon. Mr. Tiedemann, I'd like to turn things back to you for any closing remarks. Okay, thank you, operator. And thank you everyone for dialing in late on a Friday. And we invite you to contact us with any questions that you might have or to schedule any follow-up calls. And we're excited for 2024 and look forward to updating you further on our first quarter call. Have a great weekend. Thank you again. Again, ladies. www.globalonenessproject.org, transcript Emily Beynon

Alright, thank you.

Good evening thanks.

Thanks, a lot. Thank you Omar.

Thank you and just a quick reminder, ladies and gentlemen, any further questions. This afternoon. Please press star one at this time.

Okay.

Yes.

And gentlemen, it appears we have no further questions. This afternoon, Mr. Tito me and I'd like to turn things back to you for any closing comments.

Okay. Thank you operator.

Thank you everyone for dialing in.

On a Friday.

And we invite you to contact us with any questions that you might have or to schedule any follow up calls and we're excited for 2024 and look forward to updating you further on our first quarter call.

Great weekend, Thank you again.

Again, ladies and gentlemen that will conclude today's conference call, we'd like to thank you all so much for joining us and again wish you all a great evening Goodbye.

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Mhm.