Janus Henderson Group Plc Q4 FY2023 earnings call

• Strategic pillars: protect and grow core businesses, amplify strengths not fully leveraged, diversify where clients give right to win.
• 2023 net outflows improved to $700 million from $31 billion in 2022, driven by lower redemptions, large wins in global institutional, and turnaround in North American intermediary.
• Re-energized culture with mission, values, and purpose company-wide.
• Achieved run rate cost efficiencies of over $50 million sooner than expected, reinvested in strategic initiatives.
• Simplified operating model with upgraded order management system and delisted from ASX.
• Board authorized share buyback program, returned $321 million to shareholders in 2023.

Total AUM increased 17% in 2023, ending at $334.9 billion, which is 7% higher than the 2023 average AUM. In the fourth quarter, net outflows were $3.1 billion, but ending AUM was up 9% from Q3. Equity flows were negative $3.2 billion in Q4. Fixed income had net inflows of $1.7 billion in Q4, with fixed-income ETFs contributing $3.2 billion in flows. The multi-asset and alternatives capability had net outflows of $1.4 billion and $200 million respectively.

• Anticipate comp ratio in the range of 43% to 45% in 2024, down from 45.8% in 2023.
• Non-compensation expense growth expected to be mid to high-single digits.
• Tax rate on adjusted net income attributable to JHG expected in the range of 23% to 25%.
• Tailwind into Q1 from period end AUM of $335 billion.

• Market volatility due to historic rate hikes.
• Uncertainty in M&A integration and cultural fit.
• Regulatory changes impacting business operations.
• Potential for industry rotation affecting flow capture.

Q: Expand upon the fixed income or the active ETF strategy.

A: Ali talks about democratizing institutional investment skillsets, active fixed income ETFs at $12B AUM, focus on client needs.

Q: Inorganic opportunity and M&A holdups.

A: Ali says disciplined approach, client-led, cultural fit important.

Q: Insurance channel appetite.

A: Ali mentions strong skills, strategic partnerships, opportunity to grow.

Q: Pipeline rebuilding progress.

A: Ali says leading indicators positive, early to mid-state pipeline good, takes time.

Q: EMEA business positioning.

A: Ali says vehicle-agnostic, learn from U.S. success, apply resources accordingly.

Q: ETFs, active equity, mutual fund conversions.

A: Ali says vehicle-agnostic, democratize institutional strategies, broaden client scope.

Q: Cost savings, 2024 expenses.

A: Roger talks about comp and non-comp expense management, automation, guidance on ranges.

Q: Retirement channel, product launches.

A: Ali talks about CIT market potential, client-led product launches.

Q: Organic growth journey, flows.

A: Ali says on right path, but not linear, still work needed on pipeline.

Q: Performance fees, comp ratio.

A: Roger talks about difficulty in predicting, comp ratio ranges, built into guidance.

Q: Cash available, Privacore.

A: Roger talks about cash, Privacore launch details, milestone this quarter.

Q: M&A model, big picture.

A: Ali says open to models, disciplined, client-led approach.