Acadian Asset Management Q3 FY2025 earnings call

• Acadian is a pure-play publicly traded systematic manager founded in 1986, pioneering systematic investing with $166.4 billion AUM. - Strong investment performance track record with multiple strategies outperforming benchmarks across 3-, 5-, and 10-year periods. - Extensive global distribution platform with 4 offices, over 100 client and distribution team members, serving over 1,000 clients in 40+ countries. - $39 billion gross sales in the first 9 months of 2025, surpassing previous record. - Net flows of $6.4 billion in Q3 '25, second highest in firm history, with 7 consecutive quarters of positive net flows.

Acadian's U.S. GAAP net income attributable to controlling interest was down 11% and EPS was down 7% compared to prior year due to increased operating expenses. ENI diluted EPS was $0.76, up 29%, and adjusted EBITDA was up 12% driven by growth in recurring base management fees and share repurchases. In Q3 '25, the firm realized $6.4 billion of positive net client cash flows, 4% of beginning-period AUM, the second highest in history. AUM surged to $166.4 billion. By revenue, 95% of strategies outperformed benchmarks over 5 years with a 4.5% annualized excess return.

• Fiscal year 2025 operating expense ratio expected to be approximately 44% to 46%, and variable compensation ratio approximately 43% to 45%. - Plan to redeem $275 million senior notes and refinance with a committed 3-year bank term loan, with flexibility in capital management, prioritizing organic growth then return of capital to shareholders.

• Forward-looking statements subject to risks and uncertainties detailed in SEC filings. - Market conditions and client demand can impact fee rates and asset under management.

Q: On institutional pipeline composition, any particular strategies or strategy buckets seeing demand from clients?

A: Enhanced equity resonates with international and increasingly U.S. clients; extension strategies picked up interest from U.S. clients, with core international equity also in demand. Pipeline diverse by strategy and client domicile, edging closer to 50-50 AUM split between U.S. and non-U.S. clients.

Q: Update on capital management and term loan repayment?

A: Capital management is athletic, with flexibility in the new term loan, prioritizing organic growth then return of capital to shareholders, and looking to repurchase shares and manage debt every quarter while being mindful of debt position.

Q: Geographic mix and emerging markets?

A: Increased interest in international strategies, some pockets of interest in emerging markets but less than developed international, with emerging markets seeing pockets of interest after relatively flat demand in prior years.

Q: Outlook for fee rate?

A: Transition in fee rate due to traction in enhanced equity, with factors like market levels and client demand affecting it; could see downward pressure in fee rate but with multiple factors at play.

Q: Systematic fixed income capabilities?

A: Hired Scott Richardson 3.5 years ago, built an outstanding team, track records in incubation stage but showing positive performance month-over-month and quarter-over-quarter, with 3-year track records important for client comfort in fixed income