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01/11 03:05
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call presents a mixed picture. Financial performance shows modest revenue growth but increased expenses, suggesting pressure on margins. The strategic investments and stock buybacks indicate confidence, yet management's vague responses in the Q&A raise concerns about transparency. The optimistic guidance and potential large pipeline are positive, but the unclear details on M&A and buybacks, along with the decrease in cash reserves, temper enthusiasm. Overall, the sentiment is balanced, warranting a neutral outlook.
Discretionary Assets Under Management (AUM) $23.7 billion, a 4.4% sequential quarterly increase and a 9.7% year-over-year increase, primarily due to strong markets.
Total Assets Under Management (AUM) $36.7 billion, a new high for the firm.
Revenue for Q2 2025 $30.7 million, a decrease of $0.3 million or 1% year-over-year, primarily driven by a decrease in the average annual management fee rate due to the mix in AUM.
Consolidated Net Income for Q2 2025 $3.1 million.
Expenses for Q2 2025 Increased by $0.9 million or 3.7% year-over-year, primarily driven by increased compensation and benefits expense and G&A expenses.
Compensation and Benefits Expense for Q2 2025 Increased by $0.3 million or 1.7% year-over-year, primarily due to increases in salaries and benefits expenses as a result of merit-based increases and new hires, partially offset by decreases in the accrual for bonuses and equity-based compensation.
G&A Expenses for Q2 2025 Increased by $0.6 million or approximately 8.8% year-over-year, primarily due to increases in professional fees, occupancy and related expenses, marketing and advertising, shareholder expenses, and travel and entertainment expenses.
Net Income Attributable to Class A Shareholders for Q2 2025 Approximately $1.9 million or $0.21 per basic and diluted Class A share.
Adjusted EBITDA for Q2 2025 Approximately $5.7 million or 18.7% of revenue.
Adjusted Net Income for Q2 2025 Approximately $3.3 million or $0.26 and $0.25 per adjusted basic and diluted earnings per share, respectively.
Revenue for First Half of 2025 Increased by $0.8 million or 1.3% year-over-year, primarily driven by market appreciation and partially offset by net client outflows.
Expenses for First Half of 2025 Increased by $3.1 million or 6.3% year-over-year, primarily driven by increased compensation and benefits expense and G&A expenses.
Compensation and Benefits Expense for First Half of 2025 Increased by $1.5 million or 4.2% year-over-year, primarily due to increases in salaries and benefits expense as a result of merit-based increases and new hires, partially offset by decreases in the accrual for bonuses and severance expense.
G&A Expenses for First Half of 2025 Increased by $1.6 million or approximately 11.6% year-over-year, primarily due to increases in professional fees, occupancy and related expenses, shareholder costs, marketing costs, and portfolio and systems expense.
Net Income Attributable to Class A Shareholders for First Half of 2025 Approximately $4.4 million or $0.47 per basic and diluted Class A share.
Adjusted EBITDA for First Half of 2025 Approximately $12.2 million or 19.7% of revenue.
Adjusted Net Income for First Half of 2025 Approximately $7.2 million or $0.57 and $0.54 per adjusted basic and diluted EPS, respectively.
Total Assets as of June 30, 2025 Approximately $152.7 million compared to $194.4 million as of the end of last year.
Cash and Cash Equivalents as of June 30, 2025 Approximately $30 million compared to $68.6 million at the end of last year.
Class A Stockholders' Equity as of June 30, 2025 Approximately $64.6 million.
Class A Shares Repurchased During Q2 2025 Totaling approximately $15.3 million.
Discretionary Assets Under Management (AUM): Increased by $1 billion during Q2 2025, reaching $23.7 billion, a 4.4% sequential quarterly increase and a 9.7% year-over-year increase. Total AUM hit a new high of $36.7 billion.
Organic New Client Accounts: Added $80 million in organic new client accounts during Q2 2025 and $0.5 billion in the first half of 2025. Over the past 4 quarters, $2 billion in organic new client accounts were added.
Revenue and Net Income: Revenue for Q2 2025 was $30.7 million, a decrease of $0.3 million (1%) year-over-year. Net income for the quarter was $3.1 million.
Expenses: Expenses increased by $0.9 million (3.7%) year-over-year, driven by higher compensation, benefits, and G&A expenses.
Adjusted EBITDA: Adjusted EBITDA for Q2 2025 was $5.7 million, representing 18.7% of revenue.
Stock Repurchase Program: Completed a $12 million stock repurchase program and announced a new $25 million buyback program in May 2025.
Strategic Investments: Focused on talent acquisition and transitioning the business to the next generation of professionals. Investments aim to secure significant organic flows in 2025 and 2026.
Dividend Increase: Increased quarterly dividend by 5% to $0.21 per share of Class A common stock, effective September 2025.
Net Client Outflows: Despite strong market performance, the company experienced negative net flows, indicating challenges in retaining or attracting clients.
Decreased Revenue: Revenue for the quarter decreased year-over-year by $0.3 million or 1%, primarily due to a decrease in the average annual management fee rate caused by the mix in AUM.
Increased Expenses: Expenses for the quarter increased year-over-year by $0.9 million or 3.7%, driven by higher compensation, benefits, and G&A expenses, which could pressure profitability.
Higher Compensation Costs: Compensation and benefits expenses increased due to merit-based salary increases and new hires, which raised the recurring cash compensation ratio.
G&A Expense Growth: General and administrative expenses rose by 8.8%, driven by higher professional fees, occupancy costs, marketing, and travel expenses, adding to operational costs.
Decline in Cash Reserves: Cash and cash equivalents dropped significantly from $68.6 million at the end of last year to $30 million as of June 30, reducing financial flexibility.
Future Revenue Growth: Barring short-term market volatility, the increase in AUM bodes well for future revenue as Silvercrest primarily bills quarterly in advance.
Organic Client Flows: Silvercrest remains highly optimistic about securing more significant organic flows over the course of 2025 and 2026, as their investments bear fruit.
Strategic Investments: The firm continues to invest in talent across the firm to drive new growth and successfully transition the business toward the next generation of professionals. The new business pipeline remains robust.
Compensation Adjustments: Silvercrest will continue to monitor and adjust their interim compensation ratio to match important investments in the business as long as there are compelling opportunities to grow the firm and build return on invested capital.
Capital Returns: The company announced a new buyback program of $25 million on May 23, 2025, and plans to continue looking for opportunities to return capital to or accrete shareholders, especially as they invest in the business.
Dividend Increase: On July 30, the company's Board of Directors approved an increase of 5% to the company's quarterly dividend, from $0.20 per share of Class A common stock to $0.21 per share of Class A common stock. The dividend will be paid on or about September 19 to stockholders of record as of the close of business on September 12.
Stock Repurchase Program: Silvercrest completed a $12 million stock repurchase program at the beginning of the second quarter. Subsequently, a new buyback program of $25 million was announced on May 23, 2025.
The earnings call presents mixed signals: a slight increase in revenue and optimistic future AUM growth, but higher expenses and decreased net income. The new buyback program and organic client flow optimism are positives, yet the lack of specific guidance and increased expenses are concerns. The Q&A highlights some temporary cost issues and a strong pipeline, but management's vague responses may unsettle investors. Overall, the sentiment is neutral, reflecting balanced positive and negative factors.
The earnings call presents a mixed picture. Financial performance shows modest revenue growth but increased expenses, suggesting pressure on margins. The strategic investments and stock buybacks indicate confidence, yet management's vague responses in the Q&A raise concerns about transparency. The optimistic guidance and potential large pipeline are positive, but the unclear details on M&A and buybacks, along with the decrease in cash reserves, temper enthusiasm. Overall, the sentiment is balanced, warranting a neutral outlook.
The earnings call presents a mixed picture. Strong positives include successful new client inflows, optimistic future revenue expectations, and a completed stock repurchase program. However, market volatility, increased expenses, and unclear guidance on future buybacks and AUM numbers in Europe and Singapore temper this optimism. The Q&A reveals some analyst concerns about expense management and international exposure. With no market cap available, it's challenging to assess the reaction magnitude, but the overall sentiment leans towards neutral given the balance of positive and negative factors.
The earnings call reveals strong financial performance with increased revenue and net income, alongside positive pipeline growth and discretionary AUM. Although expenses have risen, the company is managing them prudently, and there's a strategic focus on international expansion and operational efficiency. The buyback plan and high dividend payout further bolster investor confidence. Despite some uncertainties in pipeline measurement and global fund expenses, the overall sentiment is positive, predicting a 2% to 8% stock price increase.
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