Q1 2025 Victory Capital Holdings Inc Earnings Call Transcript
Key Points
- Victory Capital Holdings Inc (VCTR) reported a significant increase in gross sales, reaching $9.3 billion, marking the highest level of quarterly gross sales in three years.
- The company's ETF platform saw substantial growth, with total ETF AUM increasing by 28% during the quarter and 67% year-over-year.
- Adjusted earnings per diluted share with tax benefit was $1.36, the second highest quarterly EPS in company history and a record high for any first quarter period.
- The acquisition and integration of Amundi US has doubled the company's fixed income AUM and expanded its global reach, with $44 billion of assets under management sourced from clients outside of the US.
- Victory Capital Holdings Inc (VCTR) increased its quarterly dividend and has a $200 million share repurchase plan available, indicating strong financial flexibility and shareholder return potential.
- Total client assets declined by less than 3% during the quarter, primarily due to market action.
- The company experienced two large redemptions totaling $2.7 billion, which negatively impacted net flows.
- Revenue for the first quarter was down approximately 5% from the fourth quarter due to slightly lower average AUM and fewer days in the quarter.
- The integration of Amundi US is expected to cause a slight decline in adjusted EBITDA margins over the next several quarters.
- The average fee rate decreased due to product, vehicle, and channel mix shifts, impacting total revenue.
Good morning, and welcome to the Victory Capital first-quarter 2025 earnings conference call. (Operator Instructions) Following the company's prepared remarks, there will be a question-and-answer session. I will now turn the call over to Mr. Matthew Dennis, Chief of Staff and Director of Investor Relations. Please go ahead, Mr. Dennis.
Thank you. Before I turn the call over to David Brown, I would like to remind you that during today's conference call, we may make a number of forward-looking statements. Victory Capital's actual results may differ materially from these statements. Please refer to our SEC filings for a list of some of the risk factors that may cause actual results to differ materially from those expressed on today's call. Victory Capital assumes no duty and does not undertake any obligation to update any forward-looking statements.
Our press release, which was issued after the market closed yesterday, disclose both GAAP and non-GAAP financial
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