On August 1, 2024, Silvercrest Asset Management Group Inc (SAMG, Financial) released its 8-K filing reporting the results for the quarter ended June 30, 2024. Silvercrest, a wealth management firm, provides financial advisory and family office services to ultra-high net-worth individuals and institutional investors. The company advises on traditional and non-traditional investment strategies and offers comprehensive family office services.
Performance Overview
Silvercrest reported a revenue of $31.0 million for Q2 2024, surpassing the analyst estimate of $30.90 million. However, the earnings per share (EPS) came in at $0.28, missing the estimated $0.32. The company's total assets under management (AUM) stood at $33.4 billion, a 4.7% increase year-over-year.
Key Financial Metrics
| Metric | Q2 2024 | Q2 2023 |
|---|---|---|
| Revenue | $31.0 million | $29.7 million |
| Net Income | $4.4 million | $5.1 million |
| EPS (Basic and Diluted) | $0.28 | $0.33 |
| Adjusted EBITDA | $7.2 million | $8.1 million |
| AUM | $33.4 billion | $31.9 billion |
Challenges and Strategic Investments
Despite the revenue growth, Silvercrest faced challenges with a decrease in discretionary AUM by $1.1 billion to $21.6 billion, primarily due to the loss of institutional mandates. The company has been investing in future growth, including higher compensation and the hiring of a global equity investment team. These investments have led to increased expenses, impacting net income and other financial metrics.
Financial Achievements
Silvercrest's revenue growth is a positive indicator, driven by market appreciation. The company's diversified wealth management business and exposure to small cap institutional business position it well for future growth. The recent broadening of market participation is expected to benefit Silvercrest's AUM growth.
Income Statement Highlights
For the three months ended June 30, 2024, Silvercrest reported a net income of $4.4 million, down from $5.1 million in the same period last year. The net income margin decreased to 14.1% from 17.3%. Adjusted EBITDA was $7.2 million, representing 23.3% of revenue, compared to $8.1 million or 27.3% of revenue in Q2 2023.
Balance Sheet and Cash Flow
As of June 30, 2024, Silvercrest had cash and cash equivalents of $49.9 million, down from $70.3 million at the end of 2023. The company's total equity was $85.3 million. There were no outstanding amounts under the term loan or revolving credit facility.
Dividend Increase
On July 30, 2024, Silvercrest's Board of Directors approved a 5.0% increase in the quarterly dividend to $0.20 per share of Class A common stock, payable on September 20, 2024, to shareholders of record as of September 13, 2024.
Conclusion
Silvercrest Asset Management Group Inc (SAMG, Financial) demonstrated resilience with revenue growth amidst market challenges. The company's strategic investments and diversified business model position it for future growth, although increased expenses have impacted net income. Investors will be keen to see how these investments translate into long-term gains.
Explore the complete 8-K earnings release (here) from Silvercrest Asset Management Group Inc for further details.
