Release Date: October 30, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Total assets under management reached $17.7 billion, marking the highest level in six years.
- Strong institutional growth with over $1 billion in sales year-to-date and a pipeline nearing $2 billion.
- Successful launch and growth of two energy ETFs, with one crossing a critical trading volume threshold.
- Most US value strategies have outperformed their benchmarks over the long term.
- The company maintains a debt-free balance sheet with cash and short-term investments totaling $48.3 million.
Negative Points
- Quarterly net outflows of $325 million in the intermediary channel.
- Net outflows of $44 million in the wealth management division.
- Comprehensive income decreased significantly compared to the previous year, from $3.4 million to $0.1 million.
- Higher employee compensation and benefits expenses impacted financial results.
- Leadership change in the wealth management division with the stepping down of the President, Leah Bennett.
Q & A Highlights
Q: Could you unpack the organic pipeline, particularly regarding MIS, the new ETF initiative, and the $2 billion pipeline? How do you see these elements materializing in terms of organic flows over the next six months?
A: The pipeline primarily consists of US value opportunities in the mid and small-cap space. While it's tough to predict exact levels, the marketplace has embraced our CITs and separate accounts. We've been top-rated by a consulting firm and are on the preferred list of others, indicating a strong pipeline of opportunities from top-tier consultants. – Brian Casey, CEO
Q: With $50 million on your balance sheet and the value of growing your ETF franchise, will the new initiative require more substantive seeding capital? Do you have enough to manage that?
A: We have good opportunities for seed capital from partners Ben has worked with, so at this point, it's not a concern. – Brian Casey, CEO
Q: Are there any further questions?
A: There are no further questions at this time. – Operator
Q: Any closing remarks?
A: We're excited about our nearly $2 billion pipeline in traditional business, particularly in US value SMID and small-cap products. We've committed to high-growth segments like custom index solutions and the ETF universe, partnering with industry pioneer Ben Fulton. We appreciate your interest in Westwood. – Brian Casey, CEO
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
