Janus Henderson Group plc Q4 FY2024 earnings call

• Net flows turned positive in 2024 with $2.4 billion net inflows, a significant improvement from prior outflows. Positive net inflows from diversified regions and 29 investment strategies with >$100M net inflows. - Strategic pillars: Protect & Grow core businesses, Amplify strengths, Diversify via acquisitions (NBK, Victory Park, Tabula). Acquisitions expanded into private markets and ETFs. - Brand investment and technology use, including AI for client relationships and RFP tool. - Product launches in ETFs, SMAs, CITs, hedge funds, and innovative partnerships like with American Cancer Society and Anemoy/Centrifuge for tokenized funds.

Total AUM increased 13% in 2024 to $378.7 billion. Net inflows for the year were $2.4 billion, finishing with positive flows across diversified regions and investment strategies. In the fourth quarter, net inflows were $3.3 billion. Fixed income had net inflows of $5.2 billion, with intermediary channel net flows positive $3.5 billion in Q4. Equity flows were negative $2.5 billion but improved year-over-year. Multi-asset capability had positive flows for the first time in three years, and alternatives capability had net inflows of $500 million. Revenue contribution: Net management fee rate was 48.6 basis points, relatively resilient over two years.

• 2025 expense expectations assume flat markets, with comp ratio expected in 43%-44% range. Non-compensation expenses expected mid- to high-single-digit growth. - Operating leverage expected if markets rise, with comp ratio potentially decreasing and operating margin improving. - Fee rate expected to be broadly flattish, depending on product mix and growth in alternative spaces like VPC.

Factors like market conditions, competition, and ability to maintain fee rates and profitability. Uncertainties in the growth of new product lines and integration of acquisitions could impact results.

Q: Curious about the ETF strategy and 2025 plans?

A: Ali discussed strong ETF momentum, plans to launch more equity products in Europe via Tabula acquisition, and sees enormous opportunity in ETF landscape.

Q: 2025 outlook for expenses?

A: Roger mentioned comp ratio expected in 43%-44% range, operating leverage if markets rise.

Q: Thoughts on fixed income performance and flows outlook?

A: Ali highlighted strong fixed income performance across strategies, broad-based, and outlook is to continue delivering on flows.

Q: M&A and Privacore opportunity?

A: Ali said M&A pipeline is robust, client-led, and Roger mentioned ongoing dialogue on Privacore ownership.

Q: Fee rate outlook?

A: Roger said fee rates broadly flattish, depending on product mix and growth in alternative spaces.

Q: Thoughts on Anemoy and tokenization?

A: Ali explained it's about supporting tokenized fund needs, part of innovation strategy on disruptive financial technologies.

Q: European ETF market economics?

A: Ali said nascent market, no huge economic differentiation from U.S., Tabula helps with established presence.

Q: Performance fees outlook?

A: Roger said it's a range, depends on future performance, but performance fees are accretive to margin.

Q: Flow story and competition?

A: Ali said institutional side is early days, competitive environment but focus on delivering for clients to keep rates fair.

Q: Technology and innovation for alpha generation?

A: Ali discussed investing in technology to enhance investment process, client service, and using AI to make people more efficient.