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Westwood Holdings Group Inc. (WHG) filed Quarterly Report for the period ended 2011-09-30.
Westwood Holdings Group Inc. has a market cap of $279.5 million; its shares were traded at around $35.89 with a P/E ratio of 18.7 and P/S ratio of 5.1. The dividend yield of Westwood Holdings Group Inc. stocks is 3.9%. Westwood Holdings Group Inc. had an annual average earning growth of 3.6% over the past 10 years.
This is the annual revenues and earnings per share of WHG over the last 10 years. For detailed 10-year financial data and charts, go to 10-Year Financials of WHG.
Highlight of Business Operations:
Total Revenues. Our total revenues increased by 30% to $51.9 million for the nine months ended September 30, 2011 compared with $39.9 million for the nine months ended September 30, 2010. Asset-based advisory fees increased by 35% to $41.0 million for the nine months ended September 30, 2011 compared with $30.5 million for the nine months ended September 30, 2010 as a result of increased average assets under management by Westwood Management due to assets acquired in the McCarthy acquisition in November 2010 and inflows from new and existing clients, partially offset by market depreciation of assets and the withdrawal of assets by certain clients. We recognized a performance-based advisory fee of $991,000 for the nine months ended September 30, 2011. We did not earn a performance-based advisory fee for the nine months ended September 30, 2010. Trust fees increased by 15% to $10.3 million for the nine months ended September 30, 2011 compared with $9.0 million for the nine months ended September 30, 2010 as a result of increased assets under management by Westwood Trust due to inflows from new accounts. Market depreciation of assets and net asset outflows from existing clients partially offset these increases. Other revenues, which generally consist of interest and investment income, decreased to $(406,000) for the nine months ended September 30, 2011 compared with $476,000 for the nine months ended September 30, 2010. Other revenues are presented net and increased primarily due to an increase of $994,000 in net unrealized losses on investments partially offset by an increase of $102,000 in realized gains on investments.Total Revenues. Our total revenues increased by 19% to $16.0 million for the three months ended September 30, 2011 compared with $13.5 million for the three months ended September 30, 2010. Asset-based advisory fees increased by 32% to $13.4 million for the three months ended September 30, 2011 compared with $10.2 million for the three months ended September 30, 2010 as a result of increased average assets under management by Westwood Management due to assets acquired in the McCarthy acquisition in November 2010, and inflows from new and existing clients, partially offset by market depreciation of assets and the withdrawal of assets by certain clients. Trust fees increased by 22% to $3.5 million for the three months ended September 30, 2011 compared with $2.8 million for the three months ended September 30, 2010 as a result of increased assets under management by Westwood Trust due to inflows from new accounts. Market depreciation of assets and net asset outflows from existing clients partially offset these increases. Other revenues, which generally consist of interest and investment income, decreased to $(796,000) for the three months ended September 30, 2011 compared with $482,000 for the three months ended September 30, 2010. Other revenues are presented net and decreased primarily due to an increase of $1.3 million in net unrealized losses on investments.
Employee Compensation and Benefits. Employee compensation and benefits costs increased by 26% to $27.1 million for the nine months ended September 30, 2011 compared with $21.4 million for the nine months ended September 30, 2010. The increase was primarily due to increases of $3.1 million in incentive compensation expense as a result of higher pretax income and performance-based incentive compensation related to investment and marketing goals, $1.3 million in salary expense due primarily to increased average headcount and salary increases, $675,000 in restricted stock expense due to increases of $558,000 of expense related to service-based grants and $117,000 of expense related to performance-based grants, $222,000 in payroll tax expense related to increased salaries and an increase in the number of shares of restricted stock that vested and $145,000 in health insurance costs. In the first quarter of 2011 we concluded that it was probable that we would meet the performance goal required in order for the applicable percentage of the performance-based restricted shares awarded to our Chief Investment Officer and Chief Executive Officer to vest. As a result, we recognized expense of approximately $584,000 in the first, second and third quarters of 2011 related to these performance-based restricted stock grants. We had 81 full-time employees as of September 30, 2011 compared to 67 full-time employees as of September 30, 2010.
Employee Compensation and Benefits. Employee compensation and benefits costs generally consist of salaries, incentive compensation, equity-based compensation expense and benefits. Employee compensation and benefits costs increased by 14% to $8.3 million for the three months ended September 30, 2011 compared with $7.3 million for the three months ended September 30, 2010. The increase was primarily due to increases of $515,000 in incentive compensation expense as a result of higher pretax income, $399,000 in salary expense due primarily to increased average headcount and salary increases, $139,000 in service-based restricted stock expense due to additional grants in February and April 2011, and $52,000 in health insurance expense. These increases were partially offset by a decrease of $116,000 in performance-based restricted stock expense. In the first quarter of 2011 we concluded that it was probable that we would meet the performance goal required in order for the applicable percentage of the performance-based restricted shares awarded to our Chief Investment Officer and Chief Executive Officer to vest. As a result, we recognized expense of approximately $584,000 in the first, second and third quarters of 2011 related to these performance-based restricted stock grants. We had 81 full-time employees as of September 30, 2011 compared to 67 full-time employees as of September 30, 2010.
Professional Services. Professional services expenses generally consist of costs associated with subadvisory fees, audit, legal and other professional services. Professional services expenses decreased by 13% to $710,000 for the three months ended September 30, 2011 compared with $817,000 for the three months ended September 30, 2010. The decrease is primarily due to decreases of $98,000 in legal fees and $65,000 in professional services related to growth initiatives. Increases of $30,000 in subadvisor fees related to common trust funds sponsored by Westwood Trust and $23,000 in tax consultation fees partially offset these decreases.
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