Acadian Asset Management Q2 FY2025 earnings call

• Acadian is the only pure-play publicly traded systematic manager, founded in 1986, with a 120-person investment team. 95% of strategies by revenue outperform benchmarks over 5-year periods. - Achieved $13.8 billion of positive net client cash flow in Q2 2025, 11% of beginning period AUM, the highest quarterly net client cash flow in company history. AUM surged to $151.1 billion as of June 30, 2025. - Extensive global distribution platform with 4 offices, over 90 distribution professionals serving 1,000 client accounts in 40 countries. Gross sales in first half of 2025 were $28 billion, surpassing prior record. - Business and product development team focused on increasing strategy and vehicle offerings in high-demand areas. Client base diverse with 43% of assets from outside U.S., and 40% of assets from clients invested in multiple strategies.

Acadian Asset Management, Inc. reported Q2 2025 results with AUM reaching $151.1 billion, the highest in its history. Q2 '25 ENI revenue was $124.9 million, up 15% from Q2 '24 due to management fee growth. Management fees increased 16% from Q2 '24, reflecting a 20% increase in average AUM driven by strong positive net client cash flow and market appreciation. ENI diluted EPS was $0.64, up 42%, and adjusted EBITDA was up 22%. The ENI operating margin expanded to 30.7% in Q2 '25 from 27.1% in Q2 '24, and the operating expense ratio fell to 44.6% from 48.8% in the prior year. Revenue-weighted 5-year annualized return in excess of benchmark was 4.5% as of end of Q2, and asset-weighted was 3.6%. Gross sales in the first half of 2025 were $28 billion, surpassing previous record annual sales.

• Expect operating expense ratio for fiscal year 2025 to be approximately 45% to 47% if equity markets remain at Q2 '24 end levels. - Full year variable compensation ratio expected to be approximately 43% to 47%. - Committed to returning excess capital to shareholders over time, being thoughtful and balanced in capital deployment quarter-to-quarter.

• Forward-looking statements subject to risks and uncertainties that could cause actual results to differ materially from projections. Additional information regarding these risks and uncertainties appears in SEC filings, including Form 8-K, 2024 Form 10-K, and 2025 Form 10-Q for first quarter.

Q: Could you provide more color on the composition of the institutional pipeline?

A: The pipeline is very robust, diversified across strategies, channels, and client geography, with enhanced and extensions being key themes.

Q: Any updated outlook around capital returns in terms of repurchases for the remainder of the year?

A: Remaining committed to returning excess capital to shareholders, but will be thoughtful and balanced in capital deployment.

Q: Could you unpack the composition of the strong flows, $13.8 billion?

A: Majority of gross sales in Q2 driven by enhanced equity, with a large account contributing, shifting non-U.S. domicile clients' AUM percentage.

Q: Any new channels or vehicles to tap into?

A: Focus on existing product initiatives, including wealth and sub-advisory, and expanding vehicle offerings suitable for different client types.

Q: Push and pull on fee rate and outlook for second half?

A: Fee rate is dynamic, influenced by market moves and client demand, with focus on right product initiatives and expense discipline.