Q1 2025 Acadian Asset Management Inc Earnings Call

Operator: Ladies and gentlemen, thank you for standing by.

Ladies and gentlemen, thank you for standing by welcome to the Acadia assets Management, Inc. Earnings Conference call and webcast for the first quarter 2025 joined.

Operator: Welcome to the Acadian Assets Management, Inc.

Operator: Earnings Conference Call and Webcast for the first quarter 2025. During the call, all participants will be in listen-only mode. After the presentation, we will conduct a question-and-answer session. To be added to the queue, please press star followed by 1 at any time during the call. If you need to reach for an operator, please press star followed by zero.

During the call all participants will be in listen only mode.

After the presentation, we will conduct a question and answer session.

To be added to the queue. Please press star followed by one at anytime joined the call.

If you need to reach for an operator, Please press star followed by zero.

Operator: Please note that this call is being recorded today, Thursday, May 1st, 2025, at 11 a.m. Eastern.

Please note that this call is being recorded today Thursday may 1st 2025 at 11, a M eastern time.

Melody Huang: I would now like to turn the meeting over to Melody Huang, SVP, Director of Finance and Investor Relations. Please go ahead, Melody.

Bobby: I would now like to turn the BD, Alberta Melody, Wang SVP director of Finance and Investor Relations. Please go ahead Bobby.

Melody Huang: Good morning and welcome to Acadian Asset Management, Inc.'s conference call to discuss our results for the first quarter ended March 31st, 2025. Before we begin the presentation, please know that we may make forward-looking statements about our business and financial performance. Each forward-looking statement is subject to risks and uncertainties that could cause actual results to differ materially from those projected. Additional information regarding this risk and uncertainties appear in our SEC filing, including the Form 8K file today containing the earnings release. In our 2024 Form 10 case, any forward-looking statements that we make on this call are based on assumptions as of today.

Speaker Change: Good morning, and welcome to you are keeping the asset Management, Inc Conference call to discuss our results for the first quarter ended March 31, 'twenty 'twenty five.

Speaker Change: Before we begin the presentation. Please note that we may make forward looking statements about our business and financial performance.

Speaker Change: Each forward looking statement is subject to risks and uncertainties that could cause actual results to differ materially from those projected.

Speaker Change: Additional information regarding these risks uncertainties appear in our SEC filings, including the form 8-K filed today containing the earnings release and our 2024 Form 10-K any forward looking statements that we make on this call.

Speaker Change: So on the assumptions as of today.

Melody Huang: and we undertake no obligation to update them as a result of new information of future events.

Speaker Change: We undertake no obligation to update them as a result of new information future events.

Melody Huang: We may also reference certain non-GAAP financial measures. information about any non-GAAP measures referenced. including a reconciliation of those measures to gap measures can be found on our website, along with the slides that we will use as part of today's discussion.

Speaker Change: We may also reference certain non-GAAP financial measures.

Speaker Change: Information about any non-GAAP measures referenced <unk>.

Speaker Change: Including a reconciliation of those measures to GAAP measures can be found on our website along with the slides that we will use as part of today's discussion.

Melody Huang: Finally, nothing herein shall be deemed as an offer or solicitation to buy any investment product.

Shelton: Finally, nothing herein Shelton.

Shelton: With an offer or solicitation to buy any investment products.

Kelly Young: Our President and Chief Executive Officer will lead the call, and now I'm pleased to turn the call over to Kelly. Thanks, Melody. Good morning, everyone, and thanks for joining us today. We're very pleased with the path Acadian is on in 2025, and I'm excited to share our results for the first quarter with you. Acadian is the only pure-play, publicly-traded systematic manager. Founded in 1986, Acadian has pioneered systematic investing and we continue to lead the sector through constant innovation. We've delivered sustained outperformance across various investment strategies and through numerous market cycles. We manage $121.9 billion of AUM and Acadian is a pure systematic manager applying data and technology to the evaluation of global stocks and corporate bonds.

Kelly Young: Kelly young.

Speaker Change: Then chief Executive officer of EBITA.

Kelly Young: Now I'm pleased to turn the call over.

Kelly Young: Please.

Speaker Change: Thanks Melody and good morning, everyone and thanks for joining us today.

Speaker Change: We're very pleased with the qualification in 2025 and I'm excited to share our results for the first quarter with you.

Acadian is the only pure play publicly traded since domestic manager found.

Speaker Change: Founded in 1986, Acadian pioneers lots of investing and we continue to lead the sector through constant innovation.

Speaker Change: We live with sustained outperformance across various investment strategies and through numerous market cycles.

Speaker Change: We manage $121 $9 billion of AUM.

Speaker Change: And occasionally the appeal systematic manager applying data and technology to the evaluation of global stocks and corporate bonds.

Kelly Young: 94% of our strategies by revenue are outperforming benchmarks over a five-year period, with 4.4% annualised excess return. Our competitive edge comes from the convergence of talented people, rich data, and powerful tools, and we have a 120-person investment team with over 100 advanced analytic degrees. We're implementing product and distribution initiatives to drive sustainable growth.

Speaker Change: Lucky for some of the best strategies by revenue are up a whole new benchmarks over a five year period with 4.4% annualized excess returns I.

Speaker Change: Our competitive edge comes from the convergence with talented people rich data and powerful tool.

Speaker Change: Have 120 person, that's what home with Abraham with adult analytical degree.

Speaker Change: Great.

Speaker Change: We are implementing product and distribution initiatives to drive sustainable growth slide.

Kelly Young: Slide 4 showcases Acadian's Q1 2025 strong performance. Our net income attributable to controlling interest is up 38% compared to prior year and US GAAP EPS is up 46%. ENI deleted EPS of $0.54 per share is up 23%, with adjusted EBITDA up 10%. We delivered $3.8 billion of positive next flows, our strongest quarter in 19 years, and finished with AUM of $121.9 billion as of 31 March 2020. Acadian's investment performance track record remains strong despite the market volatility. We have five major implementations which comprise the majority of our assets. As of March 31st, 2025, Global Equity, Emerging Markets Equity, Non-US Equity, Small-Cap Equity, and our Enhanced Equity Strategy have 100% of assets outperforming benchmarks across 3, 5, and 10-year periods with one minor variation.

Speaker Change: Slide four shows places occasionally Q1, 'twenty bonds solid performance.

Speaker Change: Net income attributable to controlling interest is up 38% compared to prior years and you have got E. P. S is up 46%.

Speaker Change: Yeah, No I can lead to E. P. S with 54 cents per share is up 23% with adjusted EBITDA up 10%.

Speaker Change: We delivered $3 8 million of publication that flows our strongest quarter in 19 years.

Speaker Change: And finished with a U N of $121 $9 billion as of the 31st of March 2025.

Speaker Change: Acadian investment performance track record remains strong despite the market volatility we.

Speaker Change: We have five major implementations, which comprise the majority of our assets.

Speaker Change: As of March 31st 2025, global equity emerging markets equity and don't use that quickly.

Speaker Change: That quickly and I really hope that cookie strategy have 100% of assets outperforming benchmark across three five and 10 year periods with one minor variation.

Kelly Young: In Q1 of 2025, global equity markets experienced significant volatility amid a complex macroeconomic backdrop. While U.S. equities fell, European markets and emerging markets both rose, partly driven by dollar weakening, and investments outside of the U.S. provided significant diversification benefits for our client's portfolio. A disciplined, systematic investment process has generated meaningful long-term outcomes for our customers. Our revenue-weighted five-year annualised returns in Excessive Benchmarks was 4.4% as of the end of Q1 of 2025 on a consolidated firm-wide basis. Our asset-weighted five-year annualised return in Excessive Benchmark was 3.5% as at the end of Q1. By revenue weight, more than 94% of Acadian's strategies outperformed their respective benchmarks across 3, 5, and 10-year periods, as of the end of March 2025.

Speaker Change: In Q1 of 2025 global equity markets experienced significant volatility amid a complex macroeconomic backdrop.

Speaker Change: U S equities fell European markets in emerging markets, both rose, partly driven by the dollar week things and investments outside of the U S. Because I, just think Michigan bloodbaths vacation benefits to our card portfolios.

Speaker Change: Our disciplined this domestic investment process has generated meaningful long term outflows for alcohol.

Speaker Change: Our revenue weighted five year annualized returns in excess of benchmarks with school quit school cause them.

Speaker Change: Q1 of 2025 on a consolidated some wide basis.

Speaker Change: Our roster at ways its five year annualized return in excess of benchmark was three 5%.

Speaker Change: As at the end of Q1.

Speaker Change: By revenue wait well, the 94%, indicating strategies outperformed their respective benchmarks across three five and 10 year periods.

Speaker Change: As of March 2025.

Kelly Young: And by asset weight, more than 90% of Acadian's strategies outperformed their respective benchmarks across 3, 5, and 10-year periods.

Speaker Change: Like I said wait well, the 90% of vacating strategies outperformed their respective benchmarks across three five and 10 year periods.

Kelly Young: Next, I'd like to focus on Acadian's extensive global distribution platform, which has helped us achieve strong growth sales and will be a major driver of growth in the near future. For many years, Acadian has had a strong global presence with four offices in Boston, London, Sydney and Singapore. We have continued to expand our client and distribution team, with over 90 experienced professionals serving more than 1,000 client accounts in 40 countries. The team has established strong, deep relationships with many institutional clients and our average relationship length with our top 50 clients is over 10 years. We work with over 40 investment consultants across market segments and geographies, leading to a diverse client base invested across multiple strategies.

Speaker Change: Next I'd like to focus on the Kgs has extensive global distribution platform, which has helped us achieve strong gross sales, but it will be a major driver of growth is ahead.

Speaker Change: So many you occasionally have a strong global presence with four offices in Boston, London, Sydney and Singapore.

Speaker Change: We have continued to expand our quantum destination cool when they've been nicely.

Speaker Change: Sectional serving more than a thousand clients.

Speaker Change: 40 countries.

Speaker Change: The team has established strong relationships with many institutional clients in a rough with relationships months without put 50 plants, it's over 10 years.

Speaker Change: Work with over 40, and that's what we felt was across market segments and geographies, leading to a diverse client base invested across multiple strategies.

Kelly Young: We had approximately $9 billion of gross sales in the first quarter of 2025 after achieving record annual sales of $21 billion in 2024. In tandem with expanding our distribution capabilities, Acadian's business and product development teams have been focused on increasing our strategy and vehicle offerings in high-demand and growing areas, where Acadian's systematic approach is particularly well-suited, and our current pipeline is very robust. The success of Acadian as a highly regarded institutional investment manager is testament to our proven investment process, as well as Acadian's world-class investment and distribution. We have six clients among the top 20 global asset owners and 27 clients among the top 50 US retirement plans.

Speaker Change: We had approximately $9 billion of gross sales in the first quarter of 2025 after achieving record annual sales of 21 billion in 2024.

Speaker Change: In tandem with expanding our distribution capabilities.

Speaker Change: Do you think with product development.

Speaker Change: I've been focused on increasing our strategy and vehicle offerings in high demand and growing areas rotating the market approach is particularly well suited for that.

Speaker Change: Current pipeline is very robust.

Speaker Change: The success of Acadian is a highly regarded institutional investment manager is testament to our proven investment process as well as the Crazy World Coffee was absolutely distribution food.

Speaker Change: We have six call it among the top 20 global Wassa owners I'm 27 clients among the top 15 U S retirement plans.

Kelly Young: Over 50% of our assets are from clients invested in multiple Acadian strategies. Our client base is diverse, with 37% of assets managed for clients outside of the US. We offer over 80 institutional quality funds for investors and achieved $8.8 billion of gross sales in Q1 of 2025, reaching $121.9 billion of assets under management as of the 31st of March, 2020. The next slide highlights the positive trend in Acadian's net flows, showing a significant increase from the negative 2.3 billion in the full year of 2023 to the positive 1.8 billion in the full year for 2024, and reaching 3.8 billion in Q1 of this year.

Speaker Change: 50% of our athletes with some clients invested in multiple occasions strategy.

Speaker Change: Client basis, like that with 37% about luggage because outside of the U S.

Speaker Change: We offer over 18 institutional quality funds for investors and achieved $8.8 billion of gross sales in Q1 of 2025, reaching $121 9 billion of assets under management as of especially first of March 2025.

Speaker Change: The next slide highlights the public you've trimmed and Acadian flows showing a significant increase from a negative $2 3 billion in the full year of 2023 to the public with one 8 billion in the full year 2024, and reaching $3 8 billion in Q1 of this year.

Kelly Young: This is the highest quarterly MCCS that we've generated in 19 years. Our core strategies, such as global, non-US and EM equity, saw robust net inflows, and our newer strategies, such as enhanced equity and extension equity strategies, had meaningful positive flows in the first quarter of the year.

Speaker Change: This was the highest quarterly M. C. C. S. We've generated in 19 years.

Speaker Change: I call strategies, such as global non U S. M E M. It could be so robust inflows and.

Do you have a strategy such as in homes that could be an extension at Gucci strategy had meaningful positive flows in the first quarter of the year.

Kelly Young: As we discussed in our last earnings call, there are four key product initiatives in addition to our core strategies that we expect will drive Acadian's future growth. These are Enhanced Equity, Extension Equity. Our enhanced equity strategy underscores the potential for strong future growth as the market opportunity evolves. Enhanced equity is one of Acadian's key product initiatives to drive long-term growth. Recent flows have been robust, with ended Q1 2025 AUM of $12 billion, doubling from the prior year, and expected to continue meaningful growth in the future. Enhanced equity strategies address investors' increasing demand for consistent, low-risk alpha at fees below those of fully active strategies.

Speaker Change: As we discussed on our last earnings call. There were four key product initiatives. In addition to our core strategies that we could drive a cadence since it was.

Speaker Change: He's out in hopes that quickly extension that quickly.

Speaker Change: Domestic credit and equity alternative and we continued to make strong progress in these endeavors.

Speaker Change: Okay.

Speaker Change: Our in home set cookie strategy underscores the potential for solid future growth opportunities.

Speaker Change: Opportunity as well.

Speaker Change: And homestead quickly one is Acadian key product initiatives to drive long term growth.

Speaker Change: Closed have been with us with and with Q1 2025.

Speaker Change: 12 billion doubling from the prior year unexpectedly continued meaningful growth in the future.

Speaker Change: And home equity strategies address congrats with increasing demands for consistent low risk alpha see below those are fully active strategy. Please.

Kelly Young: These strategies appeal to a number of investors, including investors in the $16 trillion global passive equity market who are seeking improved performance with modest incremental risk. Our enhanced equity strategies repackage Acadian's alpha in a lower risk manner to meet market demand. These strategies leverage Acadian's proprietary investment process to invest in benchmark stocks and deliver attractive risk-adjusted returns with lower tracking error. And current notable implementations include the Russell 1000, MSCI Acqui, and the MSCI Emerging Markets Index.

Speaker Change: These strategies appeal to a number of investments including investments in the 16 trillion dollar global passive equity market. It was seeking improved performance with modest incremental risks.

Speaker Change: Okay.

Speaker Change: I went home sick with your strategy Repackage Acadians alpha in a lower risk level to meet market demand.

Speaker Change: These strategies leverage Acadians proprietary investment process to invest in benchmark stocks and deliver attractive risk adjusted returns with love with trucking here.

Speaker Change: No school implementations include the Russell 1000, MSCI at Cui and the MSCI emerging markets indexes.

Speaker Change: Yeah.

Kelly Young: Results have been robust, as shown on slide 13. Our enhanced equity targets stable alpha with low active risk and has produced consistent outperformance versus benchmark. In the chart below, we highlight the relationship between the monthly three-year annualised return of Acadian's Enhanced Global Equity Strategy versus that of the MSCI ACQUI Index's monthly three-year annualised return. We track the rolling return at each month's end from Enhanced Global Equity's inception date of September 2012 to the end of 2024. The solid line represents the index's returns. The dots, representing the strategy returns, are consistently close to or above the benchmark line, noting the outperformance since inception of the strategy at lower levels of tracking error than cost.

Speaker Change: Results have been robust as shown on slide 13, our enhance that could be target stable alpha with low with consistent.

Speaker Change: Consistent outperformance doesn't send smoke.

Speaker Change: In the chart below we highlight the relationship between the monthly three year annualized return of occasions and called global equity strategies.

Speaker Change: That was the MSCI <unk> index, a monthly three year annualized return.

Speaker Change: We track the rolling return each months and permanent hold stable equity section.

Speaker Change: Remember 2012 at the end of 'twenty 'twenty four.

Speaker Change: The solid line, representing the indexes were tons adult representing the strategy returned a consistently close to or above the benchmark line 19, the outperformance since inception of this strategy at lower levels of tracking error than cool strategies.

Kelly Young: Our enhanced equity strategies offer attractive risk-adjusted returns and can satisfy broader investment demand for lower fee and more consistent return characteristics.

Speaker Change: Our in home equity strategies offer attractive risk adjusted returns and can satisfy bordering restaurant demand. So let us see a more consistent return characteristics.

Melody Huang: I'm now going to turn the call over to Melody to provide you with an update on capital allocation. Thanks, Kelly. Acadian has low leverage ratios with high liquidity.

I'm now going to turn the call over to another day to provide you with an update on capital allocation.

Speaker Change: Thanks, Kelly Acadian has low leverage ratios with high liquidity position.

Melody Huang: The end of the first quarter 2025. have $119.6 million in cash and $91.5 million in fee investments. Debt including outstanding balance on revolving credit facility of $80 million reflects JORS to support first quarter seasonal needs and is expected to be fully paid out by year-end. Our debt-to-adjusted EBITDA ratio was two times as of March 31, 2025, and our net leverage ratio was just 1.3 times as of end of Q1, 2025.

Speaker Change: At the end of the first quarter 2025.

Speaker Change: We have $119 6 million in cash and $91 5 million and see investments, including outstanding balance on revolving credit facility of 80 million reflects jaws to support first quarter seasonal needs and is expected to be fully paid down by year end.

Speaker Change: Our debt to adjusted if it does this year with two times as of March 31 25.

Speaker Change: Net leverage ratio was just one three times.

Speaker Change: And the Q1 'twenty five.

Melody Huang: Amy and my board declare an interim dividend of one cent per share to be paid on June 27, 2025. Our balance sheet provides liquidity and financial flexibility to execute our growth strategy and to enhance shareholder value. We have demonstrated a track record of creating significant value through buybacks to our shareholders. Outstanding diluted share went down 57% from 86 million in Q4 2019 to 37 million shares in Q1 2025. $1.4 billion in excess capital was returned to shareholders over the last five years through shared by vaccine dividends.

Speaker Change: And my board clear, an interim dividend of one cents per share to be paid on June 27 2025.

Speaker Change: The orange cheap like liquidity and financial flexibility.

Speaker Change: Our growth strategy and to enhance shareholder value, we have demonstrated a track record of creating significant value through buybacks to our shareholders.

Speaker Change: Outstanding diluted share went down 57% from 86 million in Q4, 2019 to 37 million shares in Q1 2025.

Speaker Change: One 4 billion in excess capital was returned to shareholders over the last five years through share buybacks and dividends.

Melody Huang: during the first quarter of 2025. we repurchased 0.8 million shares of common stocks, a 2% of total outstanding shares, for an aggregate total of 19.4 million. We expect to continue generating strong free cash and deploying excess capital towards supporting organic growth and share buyback.

Speaker Change: During the first quarter of 'twenty 'twenty five.

Speaker Change: We had repurchased point annual eight shares of common stock or 2% of total outstanding shares.

Speaker Change: Aggregate total of $19 4 million.

Speaker Change: We expect to continue generating strong free cash and deploying excess capital towards supporting organic growth and share buybacks.

Kelly Young: Now, I'm going to turn the call back to Kelly.

Speaker Change: Now.

Kelly: I'm going to turn the call back to Kelly.

Kelly Young: Thanks, Melody. Slide 16 highlights that Acadian is positioning for multiple expansion and value creation. The AMI stock PE multiple, based on last 12 months' earnings, is around nine times. Our peer asset managers average is higher at around 12 times, indicating a 33% premium. The Acadian Asset Management Inc. stock price is at $26.69 as of 29 April 2025. If we apply that 33% increase to get our stock to the same 12X as our peers' average multiple, the implied price would be $35.50. This presents a compelling investment opportunity in AAMI, given our strong growth potential.

Kelly: Thanks melody.

Speaker Change: Slide 16 highlights the occasionally positioning for local expansion and value creation.

Kelly: I am I still clean multiple based on last 12 months is around nine times.

Kelly: Our premier asset managers operate this time around 12 times, indicating a 33% premium.

Kelly: Okay.

Kelly: Inc. Stock price is at $26.69 as of the cleansing antibody called 2025.

Kelly: If we apply that 33% increase yeah I'll talk to the same 12 at.

Kelly: Average so cool the implied price would be $75 and systems.

Kelly: This presents a compelling investment opportunity and I am always given our strong growth potential.

Kelly Young: Before going into Q&A, I'd like to recap the key points in this presentation. We're the only pure-play, publicly-traded, systematic non-profit. We have a nearly 40-year track record with competitive edge and systematic investment. and Acadian's investment performance track record remained strong with more than 90% of strategy by revenue outperforming over 3, 5 and 10 year periods. We started 2025 with outstanding performance. Q125 ENI EPS is up 23% from Q1 of 2024. We've delivered positive Q1 NCCS of $3.8 billion, our best quarterly flow in 19 years.

Kelly: Before going into Q&A I'd like to recap the key points in this presentation.

Kelly: We're the only pure play publicly traded systematic analysis.

Kelly: We haven't seen a 40 year track record, we can Pepsi vegging systematic investing and Acadians investment performance track record remains strong with more than 90% of strategy by revenue outperforming over three five and 10 year periods.

Kelly: We've gone through 2025 with outstanding performance.

Kelly: He wasn't twenty-five Eni EPS is up 23% from Q1 of 2024.

Kelly: We delivered public to Q1 N P. C. S. A $3 8 billion, our best quarterly flows of 19 years.

Kelly Young: We will continue to drive growth through targeted distribution initiatives and accelerate growth through key product initiatives such as enhanced equity. Acadian Asset Management Inc. stock is trading at a modest P multiple of nine times compared to our peer average of 12%. Acadian is well-positioned to generate value for shareholders.

Kelly: We will continue to drive growth through targeted distribution initiatives and accelerate growth through key product initiatives such as in home equity.

Kelly: Acadia and asset management, Inc. Stock is trading at a modest P. Multiple of nine times compared to our peer average of 12 times.

Kelly: Acadia is well positioned to generate value for shareholders.

Kelly Young: Our team's focus, talent, and hard work have been instrumental in achieving these milestones, and I look forward to building on this momentum and driving further growth and innovation.

Kelly: <unk> focus and hard work have been instrumental in achieving these milestones.

Kelly: Forward to building on this momentum and driving further growth and innovation.

Operator: This concludes my prepared remarks and at this point I'd be delighted to take your questions. This time, those with questions should lift their phone receiver and press star followed by the number 1 on their telephone keypad. To cancel a question, please press star 1 again. Please hold for a brief moment while we compile the Q&A roster.

Kelly: This concludes my prepared remarks and at this point I'd be delighted to take your questions.

Speaker Change: This time dose with questions should lift their phone receiver and press star followed by the number one on their telephone keypad.

Kelly: To cancel a question. Please press star one again please.

Kelly: Please hold for a brief moment, while we compile the Q&A roster.

Michael Cyprys: Our first question comes from Michael Cyprys from Morgan Stanley. Please go ahead. Hi, Kelly, Melody, good morning. Thanks for taking the question and congratulations on the strong flows here. Best in 19 years. That's great to see. Nearly 9 billion gross sales, nearly 4 billion of net inflows.

Michael: Our first question comes from Michael <unk> from Morgan Stanley. Please go ahead.

Michael: Hi, Kelly melody. Good morning, Thanks for taking the question and congratulations on the strong flows here best in 19 years. So that's great to see nearly $9 billion gross sales a nearly $4 billion of net inflows maybe you could just unpack some of the key strategies that you saw are contributing and can you just remind us what the revenue impact was.

Kelly Young: Maybe you could just unpack some of the key strategies that you saw contributing and can you just remind us what the revenue impact was of those flows as we think about the organic based fee impact. Thank you. Morning, Mike. Nice to speak to you again. Yeah, so flows in Q1 were really pretty diversified in terms of where we've seen those asset-raising efforts. Particularly, we've seen, as I noted in my prepared remarks, a huge interest in our enhanced equity strategies and those different implementations, particularly, I'd say, across global and broader acquis and emerging markets implementation. So, continuing to see real interest and momentum there, as well as in our extensions strategies, which, again, as you know, as we noted, they're two of our sort of key initiatives.

Michael: Of those flows as we think about the organic base fee impact stemming from the strong flows in the quarter.

Michael: Yep.

Speaker Change: Morning, Mike Nice to speak to you again, yeah. So it was so flows in Q1 were really pretty diversified in terms of where we've seen as I said raising assets, particularly.

Speaker Change: Particularly we've seen as I noted in my prepared remarks, I'm a huge interest in our in home equity strategies in those different implementations, particularly I'm, sorry across global and so broad at Cui and emerging markets implementation, so continuing to see.

Speaker Change: Real interest and momentum there as well as in our extensions strategies, which again as you know as we noted there are the two of them as well as key initiatives. So very excited to see to see the growth there.

Kelly Young: So, very excited to see the growth there. Other areas of conversation that we're having with investors and where we're seeing interest is sort of broadly, I would say, in non-US strategies. And I think that's sort of some momentum and a bit of a pivot that we've seen through this quarter after last year, where there tended to be quite a US-centric bias. So, certainly, I'd say, kind of broad across the spectrum of our new initiatives, as well as some of our core strategies. In terms of overall fee impact, so our blended rate remains around 38 basis points.

Speaker Change: Other areas of conversation that we're having with investors away. We're seeing interested so broadly I would say in non U S strategies, and I think that so some momentum and a bit of a pivot that we've seen them you know it's through the school system. After last year, whether it was they tended to be quite a U S centric bias.

Speaker Change: So certainly I'd say kind of broad across the you know across the spectrum of our newer initiatives as well as some of our some of our core strategies.

Speaker Change: In terms of the impacts of that blended rate remains around 38 basis points.

Kelly Young: Obviously, in the near term, we don't expect that to change. Obviously, over the longer term, things like enhanced tend to attract a lower fee as they're sort of lower risk, lower return expectations on those strategies. But obviously, where we're seeing on the other side interest in areas like extensions, like small cap, those attract higher fees, they're limited capacity in some cases. And so, certainly, over the near term, we don't expect to change to that blended rate. But obviously, over the longer term, market dynamics flows into different areas, you know, may have an impact sort of medium to longer term.

Speaker Change: Obviously.

Speaker Change: But in the near term, we don't expect that to change obviously over the longer term I'm you know things like enhance tend to attract to lower fee has been lower risk lower return expectations on those strategies, but obviously, where we're seeing on the other side interest in areas like extensions like small cap and you know there's there's a truck tires piece then limited capacity in some.

Speaker Change: Cases, and so I'm certainly over the near term, we don't expect to change to that blended rate, but obviously over the longer term market dynamics, you know flows into different areas.

Speaker Change: You know it may have an impact sort of medium to longer term.

Kelly Young: Great, and then just to follow the question on the pipeline, maybe you could just help unpack how the composition of that looks today, size, magnitude, types of strategies in there, how that compares versus last quarter, and clearly very strong, quite impressive investment performance. Just curious how that is evolving here in April, given the volatile market. Yeah, sure. So yeah, in terms of in terms of pipeline, as I say, the momentum continues to build in those two of those key initiatives in the near term in both enhanced and extension. So I expect those to continue to be a theme in terms of pipeline and asset raising through through this year.

Speaker Change: Great and then just a follow up question on the pipeline, maybe you could just help unpack how the composition of that looks today size magnitude types of strategies in there how that compares versus last quarter and clearly very strong quite impressive investment performance just curious how that is evolving here.

Speaker Change: April given the volatile market backdrop.

Speaker Change: Yeah sure. So yeah in terms of in terms of pot line as I say the momentum continues to build in those two of those key initiatives in the near term in both in homes and an extension. So I expect those to continue to be a theme in terms of pipeline and asset raising through through this year and as I say, Michael we're having kind of more.

Kelly Young: And as I say, Michael, we're having kind of more conversations now of a non US nature or sort of broader in terms of global and sort of some, I'd say, some resurgence of interest in emerging markets. So so pretty broad in terms of pipeline, obviously, Q1, very strong, very strong quarter in terms of gross sales. The pipeline remains very robust. So again, we're obviously looking to continue to build on that momentum and feel pretty positive about where we are now going into Q2 and Q3.

Speaker Change: Conversations now are in non U S nature also of broader in terms of global and so some I'd say some resurgence of interest in emerging markets. So so pretty broad in terms of pipeline, obviously Q1, very strong very strong quarter in terms of gross sales.

Speaker Change: The pipeline remains very robust. So again, we we're obviously looking to continue to build on that momentum and I feel pretty positive about where we all know them getting into Q2 and Q3.

Kelly Young: Perhaps I'll just comment a little bit on performance. Q1 saw some mixed performance across some of the strategies. I think the benefit of being long-term investors are we're steadfast and committed to our process. And as we noticed in the presentation, our long-term returns obviously remain very strong. There's obviously been some very sharp swings in the market since early April. And I think this is where I think it's important to emphasize that Acadian's process adapts systematically and not emotionally to these types of environment. The process we've built is continually integrating new data and allowing us to respond, I'd say objectively and systematically to evolving risks.

Speaker Change: Perhaps yeah, maybe I'll just comment a little bit.

Speaker Change: <unk>.

Speaker Change: Q1 saw some mixed performance across some of the strategies.

Speaker Change: It's been long time investors.

Speaker Change: Steadfast and committed to our process and as we mentioned in the presentation.

Speaker Change: 10 returns obviously remained very strong.

Speaker Change: There's obviously been some very sharp swings in the market since early April one I think this is where I think it's important to emphasize that the acadians process adopt systematically and not emotionally to these types of environment.

Speaker Change: The prices, we bill is continually integrate to new data, new data and allowing us to respond I would say objectively and systematically to evolving risk. So.

Kelly Young: So I always think it's a good reminder that we find opportunities in periods of dislocation and periods of stress often lead to mispricings. And so for a process like ours, again, this is when we can find particularly attractive opportunities, particularly in less efficient markets. But certainly the macro backdrop has obviously been a little more challenging than perhaps 2024 was. But again, still with some good areas and bright spots of performance for us and as things we hope sort of start to settle down in Q2. Again, I think we're well positioned for some good performance this year.

Speaker Change: You know I always think it's a good reminder, that as we find opportunities in periods of dislocation in periods of stress off from Nathan lead to Miss Pricings, and so for a process like ours.

Speaker Change: Again. This is when we can find you, a particularly attractive opportunities, particularly in less efficient markets.

Speaker Change: But certainly the macro backdrop, because that's obviously been you know a little more challenging than perhaps 2024 walls, but again still with you know some some good.

Speaker Change: There is some bright spots with performance for us and you know those.

Speaker Change: There's things we hope so as that starts to settle down in Q2 again I think we felt we were well positioned for some good performance this year.

Kelly Young: Great.

Speaker Change: Great. Thanks, so much.

Kenneth Lee: Our next question comes from Kenneth Lee from RBC, please go ahead. Hey, good morning. Thanks for taking the time to join us today.

Kenneth Lee: Our next question comes from Kenneth Lee from RBC. Please go ahead.

Kenneth Lee: Hey, good morning, Thanks for taking my question.

Kelly Young: Just one on capital management, wondering if you could share any updated thoughts on Outlook.

Kenneth Lee: Just one on capital management wondering if you could share any updated thoughts around the outlook for share repurchases.

Kenneth Lee: The rest of the year and perhaps just remind us again.

Kelly Young: This concludes today's webinar. Yeah, morning Ken, nice to speak to you again. Yeah, as we've previously disclosed over a number of quarters, you know, one of our key objectives is obviously to return capital to shareholders through stock buybacks. So in Q1, as we noted, we bought back 0.8 million shares, or $19 million in total. The most recent authorisation has approximately $61 million remaining on it, as at the end of the quarter. But maybe just to be clear on that, any actual buyback activity is obviously subject to, you know, a number of factors. That's obviously the company stock price, the capital needs of the business, the economic backdrop, market conditions.

Kenneth Lee: Whats remaining in terms of the share repurchase authorization at this point thanks.

Kenneth Lee: Yeah morning, Ken must speak to you again, yes, as we've previously disclosed them over a number of quarters now one of our key objective is obviously to return capital to shareholders through stock buybacks.

Kenneth Lee: So in Q1 as we noted we bought back.

8 million shares or $19 million in total.

Kenneth Lee: The most recent authorization has approximately $61 million remaining on it.

Kenneth Lee: We ended the quarter, but maybe just to be clear on that any actual buyback activity is obviously subject to a number of factors. That's obviously the company's stock price.

Kenneth Lee: Yeah, the capital needs of the business the economic backdrop market condition. So.

Kelly Young: So, you know, the board does refresh the amount of that authorisation from time to time when we think it's prudent to do so. But we don't have a specific timeframe in mind to sort of finish those buybacks under that current authorisation, Ken. And as I say, again, that's going to depend on, you know, a variety of factors such as, you know, stock price being one of them, but there is $61 million remaining on the current authorisation.

Kenneth Lee: You know the board does refresh the amount without authorization from time to time, when we think it's prudent to do so.

Kenneth Lee: But we don't have a specific time frame in mind just to finish those buybacks under that under the current authorization 10, and as I say again, that's going to depend on you know.

Kenneth Lee: Variety of factors, such as stock price being being one of them, but there were $61 million remaining on the current authorization.

Kenneth Lee: Okay, great, very helpful there. And just one follow-up, if I may, looking through the slides, The various expense ratios, the outlooks there are unchanged from the last quarter.

Kenneth Lee: Okay, great very helpful. There.

Kenneth Lee: And just one follow up.

Kenneth Lee: Looking through the slides it looks as if the various expense ratios. The outlooks there are unchanged from last quarter.

Melody Huang: I wonder if you could just talk a little bit more about potential levers, you know, Acadian might have. Further Expense Reductions If Needed If Market Volatility for a longer period of time, thanks. Hi Ken, good morning, this is Melody. Yes, our expenses, operating expenses, and variable comm ratio remain the same. I think we are going to be continual laser focus on expense management. And, you know, in terms of the market volatility, we will manage our expenses, make sure that We continue to achieve the similar margin, so that. Currently, we're the expenses ratio for the full year remain unchanged?

Kenneth Lee: Wonder if could just talk a little bit more about potential levers.

Kenneth Lee: Ken you might have for them.

Kenneth Lee: Further expense reductions if needed if market volatility were to continue for example for a longer period of time. Thanks.

Speaker Change: Hi, Ken Good learning does this melody yes.

Kenneth Lee: Yes.

Kenneth Lee: <unk> expenses operating expenses and variable comp ratio I remain the same.

Kenneth Lee: I think we are going to be continued laser focus on expense management.

Kenneth Lee: And you know.

Kenneth Lee: In terms of the market volatility, we will manage our expenses make sure that.

Kenneth Lee: We continue to achieve.

Kenneth Lee: Achieved a similar margin.

Kenneth Lee: So that's.

Kenneth Lee: Currently were.

Kenneth Lee: Good.

Kenneth Lee: The expenses ratio for the full year remain unchanged and.

Kelly Young: You know, and we generate very strong free cash flow, as you know, Ken. So I think, you know, we remain very well positioned today to support growth, to return capital to shareholders. But to Melody's point, we obviously remain laser focused on on on expenses and being efficient. And again, I think, you know, the one of the many benefits of being a systematic manager is the ability to, you know, raise assets and not necessarily have to scale costs in a linear fashion. Got you.

Kenneth Lee: And we generate very strong free cash flow as you know Ken So I think we remain very well positioned today.

Kenneth Lee: To support growth to return capital to shareholders, but to model at this point, we will remain laser focused on.

Kenneth Lee: On expenses and being efficient and again I think.

Kenneth Lee: One of the many benefits of being systematic manager has the ability to.

Kenneth Lee: So you know raise assets and not necessarily have to scale costs in a linear fashion.

Speaker Change: Got you very helpful. There. Thanks again.

Kenneth Lee: Very helpful there.

Kenneth Lee: Thanks again.

Operator: Thank you.

Kenneth Lee: Great. Thank you.

Kenneth Lee: Okay.

John Dunn: Our next question comes from John Dunn from Evergreen. Hi, Kelly. Hi, Melody.

Kenneth Lee: Our next question comes from John Dunn from Evercore.

John Dunn: Hi, Kelly.

Kelly Young: I wonder, you know, just with the market moves we've had so far in 2Q, could you give us a little color on what of your strategies is seeing demand, you know, in April, and particularly manage vol, which I think had been out of favor for a while, and maybe, you know, this might be a more constructive environment for it. Morning, John. Yes, I mean, April has been a similar theme, I would say, to what we saw in sort of Q1, the back half of Q1. The areas of interest have really tended to be, you know, our broader strategies, so sort of global and ACQUI implementations, things that are not perhaps as focused on just the US.

John Dunn: I Wonder you know just with the market moves we've had so far in <unk>, maybe could you give us a little color on what have.

John Dunn: Of your strategies is seeing demand.

John Dunn: April.

John Dunn: <unk> managed vol, which I think had been out of favor for a while and maybe.

John Dunn: This might be a more constructive environment for it.

John Dunn: Sure.

John Dunn: Hum.

John Dunn: Yes, no say in April or so it's been a similar theme I would say to them to.

John Dunn: So what we saw in Q1 in the back half of Q1.

John Dunn: Yeah. It was of interest of really tended to be you know a broader strategy says it was global and <unk> implementations.

John Dunn: Things are not perhaps I'll focus on just the U S. Enhance it again I think that's a lower risk more consistent return profiles are proving to be pretty cops and resonating with you know with clients. As you know the managed vol has been a bit of a headwind for us in the.

Kelly Young: Enhanced, again, I think those sort of lower risk, more clients. As you know, ManageVol has been a bit of a headwind for us in the most recent few quarters, but as you know, it's a strategy I think that's recently had an opportunity to kind of reassert its value in this type of market environment, and we've certainly sort of seen that in, I'd say, the first four months of this year. I don't imagine that we're going to see a strong tailwind in terms of asset raising in that strategy in the next few quarters, but I do believe that investors that remain in those types of strategies will be pleased, you know, with their decision to keep those allocations given the current market environment.

John Dunn: The most recent few quarters, but it's as you know it's a strategy that I think that's recently had an opportunity to kind of reassert its value in this type of market environment, and we've certainly seen that and I'd say the first four months of this year.

John Dunn: Imagine that we're going to see a strong tailwind in terms of asset raising in that strategy. You know in the next few quarters, but I do believe the investors. The all that remain in those types of strategies will be pleased with their decision to keep those allocations given.

John Dunn: Given the current market environment, so again, not necessarily a strong tailwind in expecting see huge growth and manageable, but I suspect you're going to be less of a headwind.

Kelly Young: So, again, not necessarily a strong tailwind and expecting to see huge growth in ManageVol, but, you know, I suspect it's going to be less of a headwind as those strategies kind of prove their worth in this type of environment. Got it.

John Dunn: Those strategies kind of prove their worth in this type of environment.

John Dunn: Got it and then you just noted demand for non U S strategies.

Kelly Young: And you just noted demand for non US strategies. Maybe any thoughts on the potential for even greater demand for non US strategies as people potentially look to put more money outside the US? Yeah, I think it's going to be a theme. It's a theme in our pipeline. I think it's going to be a theme as we actually move to fund those mandates. Certainly, last year, there was a lot of focus and interest in US domestic strategies. We are seeing, I think, a number of investors think more carefully about their strategic asset allocation and perhaps adjusting those to either kind of broader developed markets mandates.

John Dunn: Maybe.

John Dunn: Any thoughts on the potential for even greater demand for non U S strategies.

John Dunn: People potentially look.

John Dunn: To put more money outside the U S.

John Dunn: Yeah, I think it's gonna be a theme and I put it. It's the same in our pipeline I think it's gonna be a theme in them as well.

John Dunn: As we actually can I move to fund those mandates suddenly late last year. There was you know a lot of focus and interest and in the U S. Domestic strategies, we all seeing I'd say a number of investors think more more carefully about this strategic asset allocation and in there perhaps adjusting those too.

John Dunn: Two other kind of broader a broader developed markets mandates. So obviously that includes U S and the global implementation, but also a lot of kind of you know.

Kelly Young: Obviously, that includes US in a global implementation, but also a lot of kind of, you know, ACWI, ex-US, EFI type mandates. So, I agree with you. There has, I think, been a shift over the last two or three months in terms of investor focus and attention on those sort of broader implementations and things perhaps of more of ex-US nature.

Speaker Change: A quick U S E. P type mandates. So I agree with you that has I think been a been a shift over the last two or three months in terms of investor focus and attention on those so.

Speaker Change: Broad implementations and things, perhaps more than X U S nature.

Operator: Thank you. Thanks. That concludes our question and answer session.

Speaker Change: Thank you.

Speaker Change: Okay. Thanks.

Kevin: That concludes our question and answer session I would like to turn the conference call back over to Kevin.

Kelly Young: I'd like to turn the conference call back over to Kelly Young. I'd just like to thank everyone for joining us today, and I wish you all a great day. Thank you.

Kevin: I'd just like to thank everyone for joining us for joining us today and I wish you all a great day. Thank you.

Kevin: Okay.

Kevin: [music].