GCM Grosvenor Inc.

Good day and welcome to the GCM Grosvenor first quarter 2024 results webcast. Later, we will conduct a question and answer session. If you are interested in asking a question, please ensure you dial in using the numbers you have been provided for this call and press star one on your keypad to join the queue. If anyone should require operator assistance, please press star then the zero key on your telephone. As a reminder, this call will be recorded. I would now like to hand the call over to Stacey Selinger, Head of Investor Relations. You may begin.

Thank you. Good morning and welcome to GCM Grosvenor's first quarter 2024 earnings call. Today I am joined by GCM Grosvenor's Chairman and Chief Executive Officer Michael Sachs, President John Levin, and Chief Financial Officer Pam Bentley. Before we discuss this quarter's results, A reminder that all statements made on this call that do not relate to matters of historical fact should be considered forward-looking statements. This includes statements regarding our current expectations for the business, our financial performance, and projections. These statements are neither promises nor guarantees. They involve known and unknown risks, uncertainties, and other important factors that may cause our actual results to differ materially from those indicated by the forward-looking statements on this call. Please refer to the factors in the risk factor section of our 10-K, our other filings with the Securities and Exchange Commission, and our earnings release, all of which are available on the public shareholder sections of our website. We'll also refer to non-GAP measures, which we view as important in assessing the performance of our business. A reconciliation of non-GAP metrics to the nearest GAP metric can be found in our earnings presentation and earnings supplement, both of which are available on our website. Our goal... is to continually improve how we communicate with and engage with our shareholders. And in that spirit, we look forward to your feedback. Thank you again for joining us. And with that, I'll turn the call over to Michael.

Thanks, Stacey. The first quarter of 24 was strong from the perspective of both our investment performance for clients and our business performance. Our funds performed well on an absolute basis and relative to peers. With regard to business performance, the first quarter of 24 was one of the strongest we have reported with regard to year-over-year increases in fundraising, adjusted net income, and fee-related earnings growth, as well as FRE margin. Year-over-year Q1 fundraising was up 74%, adjusted net income grew 39%, and fee-related earnings grew 26%. Our first quarter fee-related earnings margin surpassed 40% for the second consecutive quarter. The quarter was a pleasant change from the first quarters of the last four years, which were marked by COVID, Russia's invasion of Ukraine, the meme stock debacle, and just a year ago, bank failures. While we are always conscious and prepared for the type of volatility and disruption we have seen recently, and we are focused on the possibility of continued global geopolitical volatility, particularly in an election year in the U.S. It feels great to have gotten off to a good start this year. We are broadly above high water in absolute return strategies and therefore enjoy increased performance fee prospects. However, the first quarter remained depressed in terms of carry revenue. Announced private transaction volume is up, and we look forward to an increase in closed transactions and attendant carry distributions in the future. Generally, our prospects are good, and we continue to believe in our ability to double 2023 fee-related earnings by the end of 2028. We look forward to moving toward that goal throughout the year. The $1.6 billion of capital raised in the quarter was the second largest quarter of fundraising in the last six and the second highest first quarter total since we started reporting earnings. During the quarter, Absolute Return Strategies was the highest contributor to fundraising at nearly $500 million, resulting in modestly positive net ARS flows. Recent performance has been solid in Absolute Return Strategies, with the GCM Grosvenor Multi-Strategy Composite achieving gross performance of 4.8% in Q1, and 12.3% over the last 12 months. Despite the good news, we are not changing our general expectation of flat net flows over time with growth primarily from compounding in the ARS vertical. Consequently, we do expect we will have some negative outflow periods this year while we enjoy revenue growth from performance. In addition to absolute return strategies, private equity and credit were the other significant contributors to first quarter fundraising. In the case of private equity, where we raised almost $500 million, re-ups were a key driver. We've spoken in the past about our high re-up rates and page 10 of our earnings presentation, which John will cover, makes it clear that this is a powerful feature of our business that will continue to aid growth going forward. On last quarter's call, we discussed the general market momentum around private credit and our solution for clients in that vertical. We raised nearly $400 million in credit this quarter across customized separate accounts and specialized funds, including an additional 128 million of commitments to SCF2, our credit co-investment fund. During the first quarter, we hired two additional team members to bolster our direct credit investment capabilities. We believe our value as a solutions provider and our unique origination position enable us to grow private credit meaningfully from these levels. We are always looking for both investment opportunities to help us deliver performance and the opportunity to grow our relationships with existing investors while adding new investors. The breadth of our platform has proven to be a real asset in the pursuit of those goals. We have and will continue to identify and pursue growth in adjacent investment strategies, such as our elevate and impact strategies, and in broader distribution channels, including individual investor channels. Looking across the platform, I'm excited for the numerous ways we have to add value to clients, win, and grow the business for shareholders. Thanks for joining us today. And with that, I'll turn the call over to John.