Fourth-Quarter Highlights
- Total Client Assets of $176.1 billion
- Long-term gross flows of $6.6 billion
- Long-term net flows of ($1.7) billion
- GAAP operating margin of 48.1%
- GAAP net income per diluted share of $1.17
- Adjusted EBITDA margin of 54.0%
- Adjusted net income with tax benefit per diluted share of
$1.45
- Board authorizes 7% increase in regular quarterly cash dividend
to $0.47
- New $200 million share repurchase plan
Victory Capital Holdings, Inc. (NASDAQ: VCTR) (“Victory Capital”
or “the Company”) today reported financial results for the quarter
ended December 31, 2024.
“2024 was a transformational year for Victory Capital,” said
David Brown, Chairman and Chief Executive Officer. “During 2024, we
entered into a strategic relationship with Amundi Asset Management
S.A.S ("Amundi”) that will elevate our Company in several ways.
Through the acquisition of its U.S. business, the former Pioneer
Investments, we will further diversify and deepen our investment
capabilities as well as strengthen our U.S. intermediary
distribution efforts. Simultaneously, the 15-year exclusive
distribution agreement will globalize our Company by substantially
broadening and deepening our distribution reach outside of the
U.S.
“We remain on track to close the acquisition by the end of the
first quarter of 2025, and we are reaffirming our previous guidance
of $100 million in expense synergies.
“Our business and financial performance for the fourth quarter
and full year produced record results. We achieved the highest
adjusted earnings per diluted share with tax benefit, adjusted
EBITDA, and adjusted EBITDA margin in the history of our firm for
both the quarterly and full-year periods.
“Our Investment Franchises and Solutions platform continued to
deliver strong investment performance for our clients. The
percentage of our AUM outperforming benchmarks over the respective
3-, 5-, and 10-year periods was 59%, 73%, and 79% at year end. In
addition, 66% of our AUM in mutual funds and ETFs was rated four or
five stars overall by Morningstar.
“We continued to return capital to our shareholders during the
quarter. In December, the Board authorized a new $200 million share
repurchase program expanding on the prior $100 million
authorization that was completed during the quarter. The Board also
authorized a 7% increase in our quarterly cash dividend to $0.47
per share, which will be paid in March and is the highest quarterly
dividend payout in our Company history.
“As always, we continue to focus on serving our clients, which
is our top priority.”
1 Total AUM includes both discretionary
and non-discretionary client assets.
2 The Company reports its financial
results in accordance with generally accepted accounting principles
(“GAAP”). Adjusted EBITDA and Adjusted Net Income are not defined
by GAAP and should not be regarded as an alternative to any
measurement under GAAP. Please refer to the section “Information
Regarding Non-GAAP Financial Measures” at the end of this press
release for an explanation of Non-GAAP financial measures and a
reconciliation to the nearest GAAP financial measure.
The table below presents AUM, and certain GAAP and non-GAAP
(“adjusted”) financial results. Due to rounding, AUM values and
other amounts in this press release may not add up precisely to the
totals provided.
(in millions except per share amounts
or as otherwise noted)
For the Three Months
Ended
For the Year Ended
December 31,
September 30,
December 31,
December 31,
December 31,
2024
2024
2023
2024
2023
Assets Under Management1 Ending $
171,930
$
176,113
$
161,322
$
171,930
$
161,322
Average
175,741
171,876
151,870
169,658
153,455
AUM Long-term Flows2 Long-term Gross $
6,615
$
5,876
$
6,357
$
25,255
$
22,651
Long-term Net
(1,729
)
(2,631
)
(1,334
)
(7,090
)
(5,584
)
AUM Money Market/Short-term Flows Money Market / Short-term
Gross $
178
$
244
$
188
$
912
$
853
Money Market / Short-term Net
(140
)
(5
)
(47
)
(287
)
(391
)
AUM Total Flows Total Gross $
6,793
$
6,120
$
6,545
$
26,167
$
23,504
Total Net
(1,870
)
(2,636
)
(1,381
)
(7,377
)
(5,976
)
Consolidated Financial Results (GAAP) Revenue $
232.4
$
225.6
$
205.8
$
893.5
$
821.0
AUM revenue realization (in bps)
52.5
52.1
53.6
52.6
53.4
Operating expenses
120.6
105.3
119.5
466.0
492.6
Income from operations
111.7
120.4
86.3
427.5
328.5
Operating margin
48.1
%
53.3
%
41.9
%
47.8
%
40.0
%
Net income
76.9
82.0
55.2
288.9
213.2
Earnings per diluted share $
1.17
$
1.24
$
0.82
$
4.38
$
3.12
Cash flow from operations
91.8
99.8
97.1
340.0
330.3
Adjusted Performance Results (Non-GAAP)3 Adjusted EBITDA $
125.5
$
121.3
$
107.6
$
475.6
$
418.0
Adjusted EBITDA margin
54.0
%
53.7
%
52.3
%
53.2
%
50.9
%
Adjusted net income
85.0
78.9
67.4
312.9
269.7
Tax benefit of goodwill and acquired intangible assets
10.1
10.1
9.7
40.2
38.3
Adjusted net income with tax benefit
95.1
89.0
77.0
353.1
307.9
Adjusted net income with tax benefit per diluted share $
1.45
$
1.35
$
1.15
$
5.36
$
4.51
1 Total AUM includes both discretionary
assets under management and non-discretionary assets under
advisement and excludes other assets.
2 Long-term AUM is defined as total AUM
excluding Money Market and Short-term assets.
3 The Company reports its financial
results in accordance with GAAP. Adjusted EBITDA and Adjusted Net
Income are not defined by GAAP and should not be regarded as an
alternative to any measurement under GAAP. Please refer to the
section “Information Regarding Non-GAAP Financial Measures” at the
end of this press release for an explanation of Non-GAAP financial
measures and a reconciliation to the nearest GAAP financial
measure.
AUM, Flows and Investment Performance
At December 31, 2024, Victory Capital had total client assets of
$176.1 billion, assets under management of $171.9 billion, and
other assets of $4.2 billion. Total AUM decreased by $4.2 billion
to $171.9 billion at December 31, 2024, compared with $176.1
billion at September 30, 2024. The decrease was due to negative
market action of $2.2 billion and net outflows of $1.9 billion.
Total gross flows for the fourth quarter were $6.8 billion,
including long-term gross flows of $6.6 billion.
As of December 31, 2024, Victory Capital offered 124 investment
strategies through its 11 autonomous Investment Franchises and
Solutions Platform. The table below presents outperformance against
benchmarks by AUM as of December 31, 2024.
Percentage of AUM Outperforming Benchmark
Trailing
Trailing
Trailing
Trailing
1-Year
3-Years
5-Years
10-Years
47%
59%
73%
79%
Fourth Quarter 2024 Compared with Third Quarter 2024
Revenue increased 3.0% to $232.4 million in the fourth quarter,
compared with $225.6 million in the third quarter, primarily due to
higher average AUM over the comparable period. GAAP operating
margin contracted 520 basis points in the fourth quarter to 48.1%,
down from 53.3% in the third quarter primarily due to a $15.6
million increase in compensation related expenses partially offset
by a $2.9 million decrease in acquisition-related costs. Fourth
quarter GAAP net income decreased 6.2% to $76.9 million, or $1.17
per diluted share, down from $82.0 million, or $1.24 per diluted
share, in the prior quarter.
Adjusted net income with tax benefit increased 6.8% to $95.1
million, or $1.45 per diluted share in the fourth quarter, up from
$89.0 million, or $1.35 per diluted share, in the third quarter.
Adjusted EBITDA increased 3.5% to $125.5 million in the fourth
quarter, versus $121.3 million in the third quarter. Adjusted
EBITDA margin expanded 30 basis points in the fourth quarter of
2024 to 54.0% compared with 53.7% in the prior quarter.
Fourth Quarter 2024 Compared with Fourth Quarter 2023
Revenue for the three months ended December 31, 2024, increased
12.9% to $232.4 million, compared with $205.8 million in the same
quarter of 2023 as a result of higher average AUM over the
comparable period. Operating expenses increased 1.0% to $120.6
million, compared with $119.5 million in last year’s fourth quarter
due to the combination of increases in compensation and acquisition
related expenses, partially offset by a non-cash difference in
amounts recorded to the change in the fair value of consideration
payable for acquisitions as well as a decrease in general and
administrative expenses. GAAP operating margin expanded 620 basis
points to 48.1% in the fourth quarter, from 41.9% in the same
quarter of 2023. GAAP net income increased 39.4% to $76.9 million,
or $1.17 per diluted share, in the fourth quarter compared with
$55.2 million, or $0.82 per diluted share, in the same quarter of
2023.
Adjusted net income with tax benefit increased 23.5% to $95.1
million, or $1.45 per diluted share, in the fourth quarter,
compared with $77.0 million, or $1.15 per diluted share in the same
quarter last year. Adjusted EBITDA increased 16.7% to $125.5
million, compared with $107.6 million in the same quarter of last
year. Year-over-year, adjusted EBITDA margin expanded 170 basis
points to 54.0% in the fourth quarter of 2024, compared with 52.3%
in the same quarter last year.
Year Ended December 31, 2024 Compared with Year Ended
December 31, 2023
Revenue for the year ended December 31, 2024, increased 8.8% to
$893.5 million, compared with $821.0 million in the same period of
2023. The increase was primarily due to higher average AUM.
Operating expenses decreased 5.4% to $466.0 million for the year
ended December 31, 2024, compared with $492.6 million in the same
period in 2023 due to the combination of a non-cash $20.5 million
difference in amounts recorded to the change in the fair value of
consideration payable for acquisitions as well as a decreases in
compensation related expenses, distribution and other asset based
expenses, and depreciation and amortization expense, partially
offset by an increase in acquisition-related costs. GAAP operating
margin was 47.8% for the year ended December 31, 2024, a 780 basis
point increase from the 40.0% recorded in the same period in 2023.
GAAP net income increased 35.5% to $288.9 million, or $4.38 per
diluted share, in 2024 compared with $213.2 million, or $3.12 per
diluted share, in 2023.
Adjusted net income with tax benefit increased 14.7% to $353.1
million for the year ended December 31, 2024, up from $307.9
million in 2023. On a per-share basis, adjusted net income with tax
benefit increased 18.8% to $5.36 per diluted share for the year
ended December 31, 2024 compared to $4.51 per diluted share in
2023. For the year ended December 31, 2024, adjusted EBITDA
increased 13.8% to $475.6 million, compared with $418.0 million for
the same period in 2023. Year-over-year, adjusted EBITDA margin
expanded 230 basis points to 53.2% for the year ended December 31,
2024, compared with 50.9% in the previous year.
Balance Sheet / Capital Management
The total debt outstanding as of December 31, 2024 was
approximately $972 million and consisted of an existing term loan
balance of $625 million and the 2021 Incremental Term Loans balance
of $347 million.
The Company’s Board of Directors approved a regular quarterly
cash dividend of $0.47 per share. The dividend is payable on March
10, 2025, to shareholders of record on February 18, 2025.
Conference Call, Webcast and Slide Presentation
The Company will host a conference call tomorrow morning,
February 7, at 8:00 a.m. ET to discuss the results. Analysts and
investors may participate in the question-and-answer session. To
participate in the conference call, please call 1-800-715-9871
(domestic) or 1-646-307-1963 (international), shortly before 8:00
a.m. ET and reference the Victory Capital Conference Call. A live,
listen-only webcast will also be available via the investor
relations section of the Company’s website at https://ir.vcm.com.
Prior to the call, a supplemental slide presentation that will be
used during the conference call will be available on the Events and
Presentations page of the Company’s investor relations website. For
anyone who is unable to join the live event, an archive of the
webcast will be available for replay shortly after the call
concludes.
About Victory Capital
Victory Capital is a diversified global asset management firm
with total assets under management of $171.9 billion, and $176.1
billion in total client assets, as of December 31, 2024. The
Company employs a next-generation business strategy that combines
boutique investment qualities with the benefits of a fully
integrated, centralized operating and distribution platform.
Victory Capital provides specialized investment strategies to
institutions, intermediaries, retirement platforms and individual
investors. With 11 autonomous Investment Franchises and a Solutions
Business, Victory Capital offers a wide array of investment
products and services, including mutual funds, ETFs, separately
managed accounts, alternative investments, third-party ETF model
strategies, collective investment trusts, private funds, a 529
Education Savings Plan, and brokerage services.
Victory Capital is headquartered in San Antonio, Texas, with
offices and investment professionals in the U.S. and around the
world. To learn more please visit www.vcm.com or follow Victory
Capital on Facebook, Twitter, and LinkedIn.
FORWARD-LOOKING STATEMENTS
This earnings release may contain forward-looking statements
within the meaning of applicable U.S. federal and non-U.S.
securities laws. These statements may include, without limitation,
any statements preceded by, followed by or including words such as
“target,” “believe,” “expect,” “aim,” “intend,” “may,”
“anticipate,” “assume,” “budget,” “continue,” “estimate,” “future,”
“objective,” “outlook,” “plan,” “potential,” “predict,” “project,”
“will,” “can have,” “likely,” “should,” “would,” “could” and other
words and terms of similar meaning or the negative thereof and
include, but are not limited to, statements regarding the proposed
transaction and the outlook for Victory Capital’s or Amundi’s
future business and financial performance. Such forward-looking
statements involve known and unknown risks, uncertainties and other
important factors beyond Victory Capital’s and Amundi’s control and
could cause Victory Capital’s and Amundi’s actual results,
performance or achievements to be materially different from the
expected results, performance or achievements expressed or implied
by such forward-looking statements.
Although it is not possible to identify all such risks and
factors, they include, among others, the following: continued
geopolitical uncertainty including the conflicts in Ukraine and
Israel, risks that the conditions to closing the transaction with
Amundi US will be satisfied and the transaction will close on the
anticipated timeline, if at all; risks associated with expected
benefits, or impact on our business, of the proposed transaction,
including our ability to achieve any expected synergies; reductions
in AUM based on investment performance, client withdrawals,
difficult market conditions and other factors such as a pandemic;
the nature of the Company’s contracts and investment advisory
agreements; the Company’s ability to maintain historical returns
and sustain its historical growth; the Company’s dependence on
third parties to market its strategies and provide products or
services for the operation of its business; the Company’s ability
to retain key investment professionals or members of its senior
management team; the Company’s reliance on the technology systems
supporting its operations; the Company’s ability to successfully
acquire and integrate new companies; the concentration of the
Company’s investments in long-only small- and mid-cap equity and
U.S. clients; risks and uncertainties associated with non-U.S.
investments; the Company’s efforts to establish and develop new
teams and strategies; the ability of the Company’s investment teams
to identify appropriate investment opportunities; the Company’s
ability to limit employee misconduct; the Company’s ability to meet
the guidelines set by its clients; the Company’s exposure to
potential litigation (including administrative or tax proceedings)
or regulatory actions; the Company’s ability to implement effective
information and cyber security policies, procedures and
capabilities; the Company’s substantial indebtedness; the potential
impairment of the Company’s goodwill and intangible assets;
disruption to the operations of third parties whose functions are
integral to the Company’s ETF platform; the Company’s determination
that Victory Capital is not required to register as an "investment
company" under the 1940 Act; the fluctuation of the Company’s
expenses; the Company’s ability to respond to recent trends in the
investment management industry; the level of regulation on
investment management firms and the Company’s ability to respond to
regulatory developments; the competitiveness of the investment
management industry; the level of control over the Company retained
by Crestview GP; and other risks and factors listed under "Risk
Factors" and elsewhere in the Company’s filings with the SEC.
Such forward-looking statements are based on numerous
assumptions regarding Victory Capital’s present and future business
strategies and the environment in which it will operate in the
future. Any forward-looking statement made in this press release
speaks only as of the date hereof. Except as required by law,
Victory Capital assumes no obligation to update these
forward-looking statements, or to update the reasons actual results
could differ materially from those anticipated in the
forward-looking statements, even if new information becomes
available in the future.
Victory Capital Holdings, Inc.
and Subsidiaries
Unaudited Consolidated
Statements of Operations
(in thousands except per share
data and percentages)
For the Three Months
Ended
For the Year Ended
December 31,
September 30,
December 31,
December 31,
December 31,
2024
2024
2023
2024
2023
Revenue Investment management fees $
183,826
$
177,809
$
160,677
$
704,583
$
640,876
Fund administration and distribution fees
48,545
47,819
45,117
188,894
180,152
Total revenue
232,371
225,628
205,794
893,477
821,028
Expenses Personnel compensation and benefits
58,857
43,243
53,949
217,214
220,992
Distribution and other asset-based expenses
36,924
36,828
36,438
146,489
149,596
General and administrative
14,268
14,029
16,702
56,694
56,287
Depreciation and amortization
7,514
7,510
7,984
30,176
41,647
Change in value of consideration payable for acquisition of
business
294
(1,600
)
4,000
2,694
23,236
Acquisition-related costs
2,135
5,075
83
11,285
217
Restructuring and integration costs
634
180
320
1,411
595
Total operating expenses
120,626
105,265
119,476
465,963
492,570
Income from operations
111,745
120,363
86,318
427,514
328,458
Operating margin
48.1
%
53.3
%
41.9
%
47.8
%
40.0
%
Other income (expense) Interest income and other
income (expense)
1,768
3,551
3,765
10,441
8,732
Interest expense and other financing costs
(14,657
)
(16,414
)
(16,561
)
(63,836
)
(61,282
)
Loss on debt extinguishment
(263
)
—
—
(363
)
—
Total other expense, net
(13,152
)
(12,863
)
(12,796
)
(53,758
)
(52,550
)
Income before income taxes
98,593
107,500
73,522
373,756
275,908
Income tax expense
(21,654
)
(25,517
)
(18,316
)
(84,892
)
(62,751
)
Net income $
76,939
$
81,983
$
55,206
$
288,864
$
213,157
Earnings per share of common stock Basic $
1.19
$
1.26
$
0.85
$
4.47
$
3.22
Diluted
1.17
1.24
0.82
4.38
3.12
Weighted average number of shares outstanding Basic
64,428
64,875
65,309
64,607
66,202
Diluted
65,519
66,057
66,935
65,928
68,214
Dividends declared per share $
0.44
$
0.41
$
0.32
$
1.555
$
1.28
Victory Capital Holdings, Inc.
and Subsidiaries
Reconciliation of GAAP to
Non-GAAP Measures1
(unaudited; in thousands
except per share data and percentages)
For the Three Months
Ended
For the Year Ended
December 31,
September 30,
December 31,
December 31,
December 31,
2024
2024
2023
2024
2023
Net income (GAAP) $
76,939
$
81,983
$
55,206
$
288,864
$
213,157
Income tax expense
(21,654
)
(25,517
)
(18,316
)
(84,892
)
(62,751
)
Income before income taxes $
98,593
$
107,500
$
73,522
$
373,756
$
275,908
Interest expense
13,971
15,649
15,532
60,799
57,820
Depreciation
2,228
2,210
2,273
8,959
8,842
Other business taxes
376
366
305
1,525
1,707
Amortization of acquisition-related intangible assets
5,286
5,300
5,711
21,217
32,805
Stock-based compensation
1,007
972
1,503
4,246
6,496
Acquisition, restructuring and exit costs
3,063
(11,513
)
5,586
1,735
28,982
Debt issuance costs
981
775
3,128
3,385
5,394
Adjusted EBITDA $
125,505
$
121,259
$
107,560
$
475,622
$
417,954
Adjusted EBITDA margin
54.0
%
53.7
%
52.3
%
53.2
%
50.9
%
Net income (GAAP) $
76,939
$
81,983
$
55,206
$
288,864
$
213,157
Adjustment to reflect the operating performance of the Company
Other business taxes
376
366
305
1,525
1,707
Amortization of acquisition-related intangible assets
5,286
5,300
5,711
21,217
32,805
Stock-based compensation
1,007
972
1,503
4,246
6,496
Acquisition, restructuring and exit costs
3,063
(11,513
)
5,586
1,735
28,982
Debt issuance costs
981
775
3,128
3,385
5,394
Tax effect of above adjustments
(2,679
)
1,025
(4,061
)
(8,028
)
(18,847
)
Adjusted net income $
84,973
$
78,908
$
67,378
$
312,944
$
269,694
Adjusted net income per diluted share $
1.30
$
1.19
$
1.01
$
4.75
$
3.95
Tax benefit of goodwill and acquired intangible
assets $
10,141
$
10,141
$
9,655
$
40,171
$
38,252
Tax benefit of goodwill and acquired intangible assets per
diluted share $
0.15
$
0.15
$
0.14
$
0.61
$
0.56
Adjusted net income with tax benefit $
95,114
$
89,049
$
77,033
$
353,115
$
307,946
Adjusted net income with tax benefit per diluted share
$
1.45
$
1.35
$
1.15
$
5.36
$
4.51
1 The Company reports its financial
results in accordance with GAAP. Adjusted EBITDA and Adjusted Net
Income are not defined by GAAP and should not be regarded as an
alternative to any measurement under GAAP. Please refer to the
section “Information Regarding Non-GAAP Financial Measures” at the
end of this press release for an explanation of Non-GAAP financial
measures and a reconciliation to the nearest GAAP financial
measure.
Victory Capital Holdings, Inc.
and Subsidiaries
Unaudited Consolidated Balance
Sheets
(In thousands, except for
shares)
December 31, 2024 December 31, 2023 Assets
Cash and cash equivalents $
126,731
$
123,547
Investment management fees receivable
83,307
71,888
Fund administration and distribution fees receivable
16,014
14,238
Other receivables
1,346
1,444
Prepaid expenses
8,634
5,785
Investments in proprietary funds, at fair value
605
534
Deferred compensation plan investments, at fair value
34,608
31,274
Property and equipment, net
11,874
19,578
Goodwill
981,805
981,805
Other intangible assets, net
1,260,614
1,281,832
Other assets
22,053
10,691
Total assets $
2,547,591
$
2,542,616
Liabilities and stockholders' equity Accounts payable
and accrued expenses $
57,951
$
56,477
Accrued compensation and benefits
51,648
55,456
Consideration payable for acquisition of business
139,894
217,200
Deferred compensation plan liability
34,608
31,274
Deferred tax liability, net
157,120
128,714
Other liabilities
20,871
11,225
Long-term debt(1)
963,862
989,269
Total liabilities
1,425,954
1,489,615
Stockholders' equity: Common stock; $0.01 par value
per share: 2024 - 600,000,000 shares authorized, 83,947,949 shares
issued and 63,653,212 shares outstanding; 2023 - 600,000,000 shares
authorized, 82,404,305 shares issued and 64,254,714 shares
outstanding
839
824
Additional paid-in capital
752,371
728,283
Treasury stock, at cost: 2024 - 20,294,737 shares; 2023 -
18,149,591 shares
(574,856
)
(444,286
)
Accumulated other comprehensive income
18,683
31,328
Retained earnings
924,600
736,852
Total stockholders' equity
1,121,637
1,053,001
Total liabilities and stockholders’ equity $
2,547,591
$
2,542,616
1 Balances at December 31, 2024 and 2023
are shown net of unamortized loan discount and debt issuance costs
in the amount of $8.3 million and $12.4 million, respectively. The
gross amount of the debt outstanding was $972.2 million and
$1,001.7 million as of December 31, 2024 and 2023,
respectively.
Victory Capital Holdings, Inc.
and Subsidiaries
Total Client Assets
(unaudited; in
millions)
For the Three Months Ended
December 31,
September 30,
December 31,
2024
2024
2023
Beginning AUM $
176,113
$
168,681
$
148,879
Beginning other assets1
4,981
5,094
4,627
Beginning total client assets
181,094
173,775
153,506
AUM net cash flows
(1,870
)
(2,636
)
(1,381
)
Other assets net cash flows
(675
)
(446
)
200
Total client assets net cash flows
(2,545
)
(3,082
)
(1,181
)
AUM market appreciation (depreciation)
(2,237
)
10,076
13,853
Other assets market appreciation (depreciation)
(141
)
333
462
Total client assets market appreciation (depreciation)
(2,378
)
10,409
14,315
AUM realizations and distributions
—
(2
)
(27
)
Acquired & divested assets / Net transfers
(76
)
(7
)
(2
)
Ending AUM
171,930
176,113
161,322
Ending other assets
4,165
4,981
5,289
Ending total client assets
176,096
181,094
166,611
Average total client assets2
180,104
176,806
156,734
For the Year Ended
December 31,
December 31,
2024
2023
Beginning AUM $
161,322
$
147,762
Beginning other assets1
5,289
5,190
Beginning total client assets
166,611
152,952
AUM net cash flows
(7,377
)
(5,976
)
Other assets net cash flows
(1,627
)
(591
)
Total client assets net cash flows
(9,004
)
(6,567
)
AUM market appreciation (depreciation)
18,100
21,188
Other assets market appreciation (depreciation)
504
690
Total client assets market appreciation (depreciation)
18,604
21,878
AUM realizations and distributions
(2
)
(100
)
Acquired & divested assets / Net transfers
(113
)
(1,552
)
Ending AUM
171,930
161,322
Ending other assets
4,165
5,289
Ending total client assets
176,096
166,611
Average total client assets3
174,542
158,268
1 Includes low-fee (2 to 4 bps)
institutional assets, previously reported in the Solutions asset
class within the by asset class table and in Separate Accounts and
Other Pooled Vehicles within the by vehicle table. These assets are
included as part of Victory’s Regulatory Assets Under Management
reported in Form ADV Part 1.
2 For the three-month periods ending
December 31, 2024, September 30, 2024 and December 31, 2023 total
client assets revenue realization was 51.3 basis points, 50.8 basis
points and 52.1 basis points, respectively.
3 For the year ended December 31, 2024 and
2023 total client assets revenue realization was 51.2 basis points
and 51.9 basis points, respectively.
Victory Capital Holdings, Inc.
and Subsidiaries
Total Assets Under
Management1
(unaudited; in
millions)
For the Three Months Ended
December 31,
September 30,
December 31,
2024
2024
2023
Beginning assets under management $
176,113
$
168,681
$
148,879
Gross client cash inflows
6,793
6,120
6,545
Gross client cash outflows
(8,663
)
(8,756
)
(7,926
)
Net client cash flows
(1,870
)
(2,636
)
(1,381
)
Market appreciation (depreciation)
(2,237
)
10,076
13,853
Realizations and distributions
—
(2
)
(27
)
Acquired & divested assets / Net Transfers
(76
)
(7
)
(2
)
Ending assets under management
171,930
176,113
161,322
Average assets under management
175,741
171,876
151,870
For the Year Ended
December 31,
December 31,
2024
2023
Beginning assets under management $
161,322
$
147,762
Gross client cash inflows
26,167
23,504
Gross client cash outflows
(33,545
)
(29,480
)
Net client cash flows
(7,377
)
(5,976
)
Market appreciation (depreciation)
18,100
21,188
Realizations and distributions
(2
)
(100
)
Acquired assets / Net transfers
(113
)
(1,552
)
Ending assets under management
171,930
161,322
Average assets under management
169,658
153,455
1 Total AUM includes both discretionary
assets under management and non-discretionary assets under
advisement and excludes other assets.
Victory Capital Holdings, Inc.
and Subsidiaries
Other Assets
(Institutional)1
(unaudited; in
millions)
For the Three Months
December 31,
September 30,
December 31,
2024
2024
2023
Beginning other assets (institutional) $
4,981
$
5,094
$
4,627
Gross client cash inflows
—
—
200
Gross client cash outflows
(675
)
(446
)
—
Net client cash flows
(675
)
(446
)
200
Market appreciation (depreciation)
(141
)
333
462
Realizations and distributions
—
—
—
Acquired & divested assets / Net transfers
—
—
—
Ending other assets (institutional)
4,165
4,981
5,289
Average other assets (institutional)2
4,363
4,930
4,864
For the Year Ended
December 31,
December 31,
2024
2023
Beginning other assets (institutional) $
5,289
$
5,190
Gross client cash inflows
467
600
Gross client cash outflows
(2,094
)
(1,191
)
Net client cash flows
(1,627
)
(591
)
Market appreciation (depreciation)
504
690
Realizations and distributions
—
—
Acquired & divested assets / Net transfers
—
—
Ending other assets (institutional)
4,165
5,289
Average other assets (institutional)3
4,883
4,813
1 Includes low-fee (2 to 4 bps)
institutional assets, previously reported in the Solutions asset
class within the by asset class table and in Separate Accounts and
Other Pooled Vehicles within the by vehicle table. These assets are
included as part of Victory’s Regulatory Assets Under Management
reported in Form ADV Part 1.
2 For the three-month periods ending
December 31, 2024, September 30, 2024 and December 31, 2023 total
other assets (institutional) revenue realization was 3.2 basis
points, 3.4 basis points and 3.6 basis points, respectively.
3 For the year ended December 31, 2024 and
2023 total other assets (institutional) revenue realization was 3.4
basis points and 3.6 basis points, respectively.
Victory Capital Holdings, Inc.
and Subsidiaries
Assets Under Management by
Asset Class
(unaudited; in
millions)
For the Three Months Ended By Asset Class
Global / U.S. Mid U.S. Small Fixed
U.S. Large Non-U.S. Alternative Total
Money Market/ Total Cap Equity Cap
Equity Income Cap Equity Equity
Solutions Investments Long-term
Short-term AUM1 December 31, 2024 Beginning
assets under management $
32,333
$
15,591
$
25,081
$
14,239
$
19,752
$
62,544
$
3,178
$
172,720
$
3,393
$
176,113
Gross client cash inflows
1,163
393
987
75
1,535
2,291
170
6,615
178
6,793
Gross client cash outflows
(1,881
)
(1,215
)
(1,391
)
(413
)
(1,023
)
(2,037
)
(384
)
(8,344
)
(319
)
(8,663
)
Net client cash flows
(718
)
(822
)
(404
)
(338
)
513
254
(214
)
(1,729
)
(140
)
(1,870
)
Market appreciation (depreciation)
(1,008
)
21
(342
)
279
(1,143
)
(100
)
13
(2,279
)
43
(2,237
)
Realizations and distributions
—
—
—
—
—
—
—
—
—
—
Acquired assets / Net transfers
(24
)
(6
)
66
(32
)
(26
)
(105
)
3
(125
)
48
(76
)
Ending assets under management $
30,584
$
14,785
$
24,402
$
14,148
$
19,095
$
62,593
$
2,980
$
168,586
$
3,344
$
171,930
September 30, 2024 Beginning assets under management
$
31,015
$
15,182
$
24,398
$
13,983
$
18,459
$
58,936
$
3,390
$
165,362
$
3,320
$
168,681
Gross client cash inflows
975
584
1,344
73
578
2,143
179
5,876
244
6,120
Gross client cash outflows
(2,300
)
(1,278
)
(1,640
)
(486
)
(485
)
(1,877
)
(443
)
(8,508
)
(249
)
(8,756
)
Net client cash flows
(1,325
)
(694
)
(296
)
(413
)
94
265
(263
)
(2,631
)
(5
)
(2,636
)
Market appreciation (depreciation)
2,649
1,105
973
690
1,212
3,368
51
10,049
27
10,076
Realizations and distributions
—
—
—
—
—
—
(2
)
(2
)
—
(2
)
Acquired assets / Net transfers
(5
)
(2
)
6
(21
)
(13
)
(25
)
3
(58
)
51
(7
)
Ending assets under management $
32,333
$
15,591
$
25,081
$
14,239
$
19,752
$
62,544
$
3,178
$
172,720
$
3,393
$
176,113
December 31, 2023 Beginning assets under management $
28,235
$
14,650
$
23,790
$
11,596
$
14,807
$
49,371
$
3,222
$
145,671
$
3,208
$
148,879
Gross client cash inflows
1,008
555
1,072
62
1,251
1,910
498
6,357
188
6,545
Gross client cash outflows
(1,548
)
(938
)
(1,890
)
(329
)
(657
)
(1,977
)
(352
)
(7,691
)
(234
)
(7,926
)
Net client cash flows
(541
)
(383
)
(818
)
(267
)
595
(67
)
146
(1,334
)
(47
)
(1,381
)
Market appreciation (depreciation)
2,917
1,698
1,392
1,320
1,387
5,012
91
13,816
38
13,853
Realizations and distributions
—
—
—
—
—
—
(27
)
(27
)
—
(27
)
Acquired assets / Net transfers
(8
)
(6
)
(8
)
(15
)
(16
)
(20
)
(1
)
(74
)
72
(3
)
Ending assets under management $
30,604
$
15,959
$
24,355
$
12,635
$
16,772
$
54,296
$
3,431
$
158,051
$
3,271
$
161,322
1Total AUM includes both discretionary
assets under management and non-discretionary assets under
advisement and excludes other assets.
Victory Capital Holdings, Inc.
and Subsidiaries
Assets Under Management by
Asset Class
(unaudited; in
millions)
For the Year Ended By Asset Class Global
/ U.S. Mid U.S. Small Fixed U.S.
Large Non-U.S. Alternative Total Money
Market/ Total Cap Equity Cap Equity
Income Cap Equity Equity Solutions
Investments Long-term Short-term AUM1
December 31, 2024 Beginning assets under management $
30,604
$
15,959
$
24,355
$
12,635
$
16,772
$
54,296
$
3,431
$
158,051
$
3,271
$
161,322
Gross client cash inflows
4,516
2,043
4,912
284
3,762
8,634
1,105
25,255
912
26,167
Gross client cash outflows
(7,685
)
(4,195
)
(5,905
)
(1,540
)
(2,893
)
(8,509
)
(1,618
)
(32,345
)
(1,200
)
(33,545
)
Net client cash flows
(3,169
)
(2,152
)
(993
)
(1,256
)
869
125
(513
)
(7,090
)
(287
)
(7,377
)
Market appreciation (depreciation)
3,189
1,035
924
2,873
1,570
8,290
47
17,929
172
18,100
Realizations and distributions
—
—
—
—
—
—
(2
)
(2
)
—
(2
)
Acquired assets / Net transfers
(40
)
(58
)
116
(104
)
(115
)
(118
)
17
(301
)
188
(113
)
Ending assets under management $
30,584
$
14,785
$
24,402
$
14,148
$
19,095
$
62,593
$
2,980
$
168,586
$
3,344
$
171,930
December 31, 20231 Beginning assets under management
$
27,892
$
15,103
$
26,353
$
10,973
$
14,160
$
46,317
$
3,663
$
144,460
$
3,302
$
147,762
Gross client cash inflows
5,090
2,741
4,024
284
2,581
6,337
1,593
22,651
853
23,504
Gross client cash outflows
(5,536
)
(3,859
)
(6,129
)
(1,286
)
(2,304
)
(7,119
)
(2,002
)
(28,235
)
(1,245
)
(29,480
)
Net client cash flows
(446
)
(1,117
)
(2,105
)
(1,002
)
276
(781
)
(409
)
(5,584
)
(391
)
(5,976
)
Market appreciation (depreciation)
3,153
1,978
1,595
2,809
2,431
8,804
270
21,039
149
21,188
Realizations and distributions
—
—
—
—
—
—
(100
)
(100
)
—
(100
)
Acquired assets / Net transfers
5
(4
)
(1,487
)
(145
)
(96
)
(43
)
7
(1,763
)
211
(1,552
)
Ending assets under management $
30,604
$
15,959
$
24,355
$
12,635
$
16,772
$
54,296
$
3,431
$
158,051
$
3,271
$
161,322
1Total AUM includes both discretionary
assets under management and non-discretionary assets under
advisement and excludes other assets.
Victory Capital Holdings, Inc.
and Subsidiaries
Assets Under Management by
Vehicle
(unaudited; in
millions)
For the Three Months Ended By Vehicle
Separate Accounts Mutual and Other
Funds1 ETFs2 Vehicles3 Total AUM4
December 31, 2024 Beginning assets under management $
117,044
$
6,694
$
52,375
$
176,113
Gross client cash inflows
3,545
1,167
2,082
6,793
Gross client cash outflows
(5,865
)
(130
)
(2,667
)
(8,663
)
Net client cash flows
(2,320
)
1,036
(586
)
(1,870
)
Market appreciation (depreciation)
(1,063
)
(146
)
(1,028
)
(2,237
)
Realizations and distributions
—
—
—
—
Acquired assets / Net transfers
(15
)
(76
)
15
(76
)
Ending assets under management $
113,645
$
7,508
$
50,777
$
171,930
September 30, 2024 Beginning assets under management
$
112,584
$
5,440
$
50,657
$
168,681
Gross client cash inflows
3,553
992
1,575
6,120
Gross client cash outflows
(5,526
)
(158
)
(3,073
)
(8,756
)
Net client cash flows
(1,973
)
834
(1,498
)
(2,636
)
Market appreciation (depreciation)
6,443
426
3,208
10,076
Realizations and distributions
—
—
(2
)
(2
)
Acquired assets / Net transfers
(10
)
(7
)
10
(7
)
Ending assets under management $
117,044
$
6,694
$
52,375
$
176,113
December 31, 2023 Beginning assets under management $
101,138
$
4,710
$
43,031
$
148,879
Gross client cash inflows
4,126
343
2,076
6,545
Gross client cash outflows
(5,887
)
(356
)
(1,682
)
(7,926
)
Net client cash flows
(1,761
)
(13
)
394
(1,381
)
Market appreciation (depreciation)
9,466
273
4,115
13,853
Realizations and distributions
—
—
(27
)
(27
)
Acquired assets / Net transfers
(41
)
—
39
(3
)
Ending assets under management $
108,802
$
4,970
$
47,551
$
161,322
1 Includes institutional and retail share
classes, money market and VIP funds.
2 Represents only ETF assets held by third
parties. Excludes ETF assets held by other Victory Capital
products.
3 Includes collective trust funds, wrap
program accounts, UMAs, UCITS, private funds and non-U.S. domiciled
pooled vehicles.
4 Total AUM includes both discretionary
assets under management and non-discretionary assets under
advisement and excludes other assets.
Victory Capital Holdings, Inc.
and Subsidiaries
Assets Under Management by
Vehicle
(unaudited; in
millions)
For the Year Ended By Vehicle
Separate Accounts Mutual and Other
Funds1 ETFs2 Vehicles3 Total
December 31, 2024 Beginning assets under management $
108,802
$
4,970
$
47,551
$
161,322
Gross client cash inflows
14,954
3,089
8,124
26,167
Gross client cash outflows
(22,408
)
(915
)
(10,222
)
(33,545
)
Net client cash flows
(7,454
)
2,174
(2,097
)
(7,377
)
Market appreciation (depreciation)
12,561
404
5,136
18,100
Realizations and distributions
—
—
(2
)
(2
)
Acquired assets / Net transfers
(263
)
(40
)
189
(113
)
Ending assets under management $
113,645
$
7,508
$
50,777
$
171,930
December 31, 2023 Beginning assets under management $
99,447
$
5,627
$
42,688
$
147,762
Gross client cash inflows
15,594
969
6,942
23,504
Gross client cash outflows
(21,276
)
(1,567
)
(6,637
)
(29,480
)
Net client cash flows
(5,682
)
(599
)
305
(5,976
)
Market appreciation (depreciation)
15,114
(56
)
6,130
21,188
Realizations and distributions
—
—
(100
)
(100
)
Acquired assets / Net transfers4
(77
)
(3
)
(1,471
)
(1,552
)
Ending assets under management $
108,802
$
4,970
$
47,551
$
161,322
1 Includes institutional and retail share
classes, money market and VIP funds.
2 Represents only ETF assets held by third
parties. Excludes ETF assets held by other Victory Capital
products.
3 Includes collective trust funds, wrap
program accounts, UMAs, UCITS, private funds and non-U.S. domiciled
pooled vehicles.
4 Total AUM includes both discretionary
assets under management and non-discretionary assets under
advisement and excludes other assets.
Information Regarding Non-GAAP
Financial Measures
Victory Capital uses non-GAAP financial measures referred to as
Adjusted EBITDA and Adjusted Net Income to measure the operating
profitability of the Company. These measures eliminate the impact
of one-time acquisition, restructuring and integration costs and
demonstrate the ongoing operating earnings metrics of the Company.
The Company has included these non-GAAP measures to provide
investors with the same financial metrics used by management to
assess the operating performance of the Company.
Adjusted EBITDA
Adjustments made to GAAP Net Income to calculate Adjusted
EBITDA, as applicable, are:
- Adding back income tax expense;
- Adding back interest paid on debt and other financing costs,
net of interest income;
- Adding back depreciation on property and equipment;
- Adding back other business taxes;
- Adding back amortization expense on acquisition-related
intangible assets;
- Adding back stock-based compensation expense associated with
equity awards issued from pools created in connection with the
management-led buyout and various acquisitions and as a result of
equity grants related to the IPO;
- Adding back direct incremental costs of acquisitions, including
restructuring costs;
- Adding back debt issuance cost expense;
- Adjusting for earnings/losses on equity method
investments.
Adjusted Net Income
Adjustments made to GAAP Net Income to calculate Adjusted Net
Income, as applicable, are:
- Adding back other business taxes;
- Adding back amortization expense on acquisition-related
intangible assets;
- Adding back stock-based compensation expense associated with
equity awards issued from pools created in connection with the
management-led buyout and various acquisitions and as a result of
any equity grants related to the IPO;
- Adding back direct incremental costs of acquisitions, including
restructuring costs;
- Adding back debt issuance cost expense;
- Subtracting an estimate of income tax expense applied to the
sum of the adjustments above.
Tax Benefit of Goodwill and Acquired
Intangible Assets
Due to Victory Capital’s acquisitive nature, tax deductions
allowed on acquired intangible assets and goodwill provide it with
additional significant supplemental economic benefit. The tax
benefit of goodwill and intangible assets represent the tax
benefits associated with deductions allowed for intangible assets
and goodwill generated from prior acquisitions in which the Company
received a step-up in basis for tax purposes. Acquired intangible
assets and goodwill may be amortized for tax purposes, generally
over a 15-year period. The tax benefit from amortization on these
assets is included to show the full economic benefit of deductions
for all acquired intangible assets with a step-up in tax basis.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20250206913675/en/
Investors: Matthew Dennis, CFA Chief of Staff Director,
Investor Relations 216-898-2412 mdennis@vcm.com
Media: Jessica Davila Director, Global Communications
210-694-9693 jessica_davila@vcm.com
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