• Total Revenue (Q4 2024): $25.6 million, up from $23.7 million in Q3 2024 and $23.2 million in Q4 2023.
• Total Revenue (Fiscal 2024): $94.7 million, compared to $89.8 million in 2023.
• Comprehensive Income (Q4 2024): $2.1 million or $0.24 per share, compared to $0.1 million or $0.01 per share in Q3 2024.
• Comprehensive Income (Fiscal 2024): $2.2 million, compared to $9.5 million in 2023.
• Economic Earnings (Q4 2024): $3.4 million or $0.39 per share, compared to $1.1 million or $0.13 per share in Q3 2024.
• Economic Earnings (Fiscal 2024): $7 million or $0.82 per share, compared to $18.3 million or $2.26 per share in 2023.
• Assets Under Management and Advisement (End of Q4 2024): $17.6 billion, with $16.6 billion under management and $1 billion under advisement.
• Cash and Liquid Investments (End of Q4 2024): $44.6 million, with a debt-free balance sheet.
• Dividend: Regular cash dividend of $0.15 per common share, payable on April 1, 2025.

• Warning! GuruFocus has detected 5 Warning Signs with WHG.

Release Date: February 12, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Westwood Holdings Group Inc (NYSE:WHG) reported a significant increase in institutional mandates, winning and funding 8 mandates totaling over $600 million, a 100% increase over the prior year.
• The company successfully entered the fast-growing ETF market with the launch of two active ETFs, which have shown strong initial momentum.
• Westwood's flagship multi-asset strategy, Income Opportunity, executed a turnaround and finished in the top quartile for trailing periods in its Morningstar category.
• The acquisition of Salient Partners' asset management business continues to exceed expectations, enhancing capabilities in energy and real estate income strategies.
• Westwood Holdings Group Inc (NYSE:WHG) maintained a solid financial position with cash and liquid investments totaling $44.6 million and a debt-free balance sheet.

Negative Points

• Despite positive developments, Westwood Holdings Group Inc (NYSE:WHG) experienced net outflows of $0.8 billion in assets under management over the year.
• The company's comprehensive income for 2024 was $2.2 million, a significant decrease from $9.5 million in 2023, impacted by higher employee expenses and changes in the fair value of contingent consideration.
• Most of Westwood's US value products were behind their benchmarks, although 80% of value strategies are ahead over trailing 3-year periods.
• The intermediary channel faced net outflows of $229 million, despite some bright spots in specific strategies.
• Economic earnings for the year were $7 million or $0.82 per share, down from $18.3 million or $2.26 per share in 2023.

Q & A Highlights

Q: Can you provide an overview of Westwood Holdings Group's performance in the fourth quarter of 2024? A: Terry Forbes, CFO, reported total revenues of $25.6 million for Q4 2024, up from $23.7 million in Q3 and $23.2 million in Q4 2023. This increase was primarily due to higher average assets under management and performance fees. Comprehensive income for Q4 was $2.1 million or $0.24 per share, compared to a net loss of $2.6 million or $0.32 per share in Q4 2023.

Q: How did Westwood Holdings Group's ETF initiatives perform in 2024? A: Brian Casey, CEO, highlighted the successful entry into the ETF market with the launch of two active ETFs. The Westwood Salient Enhanced Midstreamcom ETF (MDST) reached $73 million in assets by year-end, exceeding expectations. The company also expanded its ETF platform with new products through a partnership with ETF veteran Ben Fulton.

Q: What strategic growth initiatives did Westwood Holdings Group undertake in 2024? A: The company completed the build-out of its managed investment solutions platform and is in promising client conversations. Additionally, the energy secondaries fund is performing as expected, and Westwood is exploring further opportunities in this space.

Q: How did Westwood Holdings Group's investment strategies perform relative to benchmarks? A: While most US value products were behind benchmarks, 80% of value strategies outperformed over trailing three-year periods. The Income Opportunity strategy ranked in the top quartile for various periods, and the Multi-asset Income strategy earned a 5-star Morningstar rating.

Q: What is Westwood Holdings Group's outlook for the future? A: The company maintains a cautiously optimistic outlook, expecting its strategies to perform well amid benign credit conditions and attractive equity valuations. Westwood is focused on strengthening core infrastructure and pursuing strategic growth, particularly in the ETF space and managed investment solutions.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.