• Total AUM: $36.5 billion as of December 31, 2024, up 9.6% from $33.3 billion at year-end 2023.
• Discretionary AUM: $23.3 billion, a 6.4% increase from $21.9 billion.
• Q4 Revenue: $32 million, up 12% from $28.5 million in Q4 2023.
• Full Year Revenue: $123.7 million, a 5.3% increase from $117.4 million in 2023.
• Q4 Net Income: $2.7 million.
• Q4 Adjusted EBITDA: $5.1 million, representing 15.9% of revenue.
• Full Year Adjusted EBITDA: $26.1 million, 21.1% of revenue.
• Q4 Adjusted Net Income: $2.9 million, with adjusted EPS of $0.21 basic and $0.20 diluted.
• Full Year Adjusted Net Income: $15.8 million, with adjusted EPS of $1.15 basic and $1.10 diluted.
• Total Assets: $194.4 million as of the end of 2024.
• Cash and Cash Equivalents: $68.6 million as of the end of 2024.
• Expenses: Q4 expenses increased by 1.7% year-over-year, primarily due to increased general and administrative expenses.
• Compensation and Benefits Expense: Decreased by 3.4% in Q4 due to a decrease in the accrual for bonuses.

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

Release Date: March 07, 2025

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

Positive Points

• Silvercrest Asset Management Group Inc (NASDAQ:SAMG) achieved strong net organic inflows, with $1.4 billion in the fourth quarter and $1.5 billion during 2024, marking the best year for new organic client inflows since at least 2015.
• The firm's total assets under management (AUM) increased by 9.6% to $36.5 billion at the end of 2024, with discretionary AUM rising by 6.4% to $23.3 billion.
• Revenue for the year increased by 5.3% to $123.7 million, with Q4 revenue up 12% year-over-year, driven by increased discretionary AUM.
• Silvercrest has expanded its global presence by hiring business development and market leads in Atlanta and Singapore, and obtaining a full MAS license for doing business in Singapore.
• The firm has developed new institutional consulting relationships and has a robust pipeline, with significant opportunities for new organic flows, particularly in its Global Value Equity strategy.

Negative Points

• Expenses for the quarter increased by 1.7% year-over-year, primarily due to increased general and administrative expenses.
• Compensation and benefits expenses increased by 5.6% year-over-year, driven by equity-based compensation, merit-based salary increases, and newly hired staff.
• General and administrative expenses rose by 18.5% in Q4, mainly due to increases in professional fees and portfolio and systems expenses.
• The firm faces challenges in accurately measuring its pipeline due to changes in how RFPs and institutional searches are conducted, making it difficult to provide consistent comparisons.
• Despite strong performance, the firm is making significant investments in personnel and infrastructure, which may impact short-term profitability and EBITDA margins.

Q & A Highlights

Q: Could you comment on the current pipeline and provide an update on OCIO assets and global inflows for 2025? A: Richard Hough, CEO: The pipeline increased from $1.2 billion to $1.6 billion, including some wins. OCIO assets are at $1.6 billion, expected to grow in 2025. The pipeline includes $100 million for global value, but measuring it is challenging due to fewer RFPs. We expect significant inflows for our global value equity strategy, with strong performance so far in 2025.

Q: Should we expect the current levels of compensation and general expenses to continue? A: Richard Hough, CEO: Yes, for the foreseeable future. We are investing in personnel and infrastructure, which impacts expenses. However, we anticipate productivity gains from technological innovations, potentially reducing costs in the medium term.

Q: What are your thoughts on operating leverage and profitability as you execute on the pipeline? A: Richard Hough, CEO: We expect to achieve operating leverage and improve EBITDA margins over time. If we stopped making personnel investments, margins would increase. However, we are focused on growth, which requires continued investment.

Q: Are there additional investments needed for the global fund, and how do geopolitical risks impact business opportunities? A: Richard Hough, CEO: We have most of the global fund infrastructure in place, but additional hires are needed for business development and client relations. Geopolitical risks have driven interest in our services, particularly from Eastern Europe, benefiting our business.

Q: What are the hurdles in international expansion, and how do you view growth opportunities outside the US? A: Richard Hough, CEO: Regulatory hurdles exist, but we are prudent with capital and focus on flows into our capabilities. Growth opportunities are significant outside the US, with wealth growing faster globally and underserved markets presenting opportunities for our RIA model.

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