SEI Investments Company

Hello, and welcome to SEI Q3 2024 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask the question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. I would now like to hand the conference over to Brad Burke, head of investor relations. You may begin.

Thank you and welcome, everyone. We appreciate you joining us today for our third quarter 2024 earnings call. On the call, we have Ryan Higgy, SEI's chief executive officer, Sean Denham, chief financial officer, Michael Lane, who leads our investment management unit, advisor in institutional businesses, and members of our executive committee, Jay Cipriano, Paul Clowder, Phil McCabe, Mike Peterson, Sneha Shah, and Sanjay Sharma. Before we begin, I would like to point out that our earnings press release can be found under the investor relations section of our website at seic.com. This call is being webcast live and a replay will be available on the events and webcast page of our website. We would like to remind you that during today's presentation and in our responses to your questions, we have and will make certain forward-looking statements that are subject to risks and uncertainties that may cause actual results to differ materially. Please refer to our notices regarding forward-looking statements that appear in today's earnings press release and in our filings with the Securities and Exchange Commission. We do not undertake to update any of our forward-looking statements. With that, I will now turn it over to our CEO, Ryan Hickey. Ryan?

Thank you, Brad, and good afternoon, everyone. SEI had, in many aspects and regards, a record quarter. Our EPS of $1.19 is the second highest quarter in our company's history, and excluding one-time items, it represents our highest ever EPS achieved, a product of top-line growth and prudent expense management. Combined assets under management, administration, and advisement grew nearly 3.5% from the prior quarter, reaching new highs. We also had net sales events totaling $46 million, which is also a record quarter for SDI. And at the end of the quarter, we implemented modifications to our integrated cash program, which more than doubled the balances in the program. Sean will unpack our financial results and changes to our integrated cash program in more detail shortly. The increased attention and energy we have put into sales, client engagement, marketing, and availing more SEI capabilities to the market is showing meaningful results. These results are an early manifestation of strategic changes over the last few quarters. It should be noted that we did benefit in the third quarter with sales events that were delayed in the first half of the year accelerating to closure in Q3. Over the last two years, we have been laser-focused on significantly increasing market activity, client engagement, and enterprise positioning. We intend to win continuously in our core markets, as well as expand our share of total addressable markets. As we invest in our platforms and talent and increase market awareness of SDI and the value we can bring to clients, we will not relent on maximizing new client growth and client expansion in the segments and markets where we want to win. For example, we continue to execute the blueprint for our private banking business by right-sizing expenses relative to the market opportunity, having a surgical focus on large segments like regional and community banks and UK private client investment managers, where we believe SEI can take market share and power growth-oriented organizations looking to increase their wealth footprint. We are also seeing real demand in this market for our data, cloud, and integration transformation services. I believe this value proposition will resonate across other SEI segments as well. Our sales events in the investment managers business, which was a record quarter, also reflect the response we're seeing in our enterprise sales efforts. The momentum is truly broad-based. We're having success with both traditional, alternative managers, U.S. clients, global clients, existing clients, and larger in-house providers looking to outsource. We expect the demand for these services will remain robust, and we will continue to invest in all parts of this business, including operational automation and AI to lead the market. SEI's third quarter earnings growth reflects both top-line and margin growth across all of our business segments. in addition to the benefit from one-time items that Sean will discuss shortly. Some additional strategic highlights. Net cash flow in the advisor business grew by $1.1 billion, predominantly led by platform adoption in the RIA space. Consolidation across custody and investment processing platform providers in the market has created an opportunity to win more clients who view SEI as a key partner. This is a market segment where we believe SEI has significant opportunity for growth, expanding our technology and operational solutions, as well as asset management. Beyond the third quarter, the trend of companies looking to scale and streamline their businesses with fewer strategic partners continues to grow. Repositioning SEI as an enterprise partner. And not just a single platform provider within a vertical market is gaining true traction. It's evidenced by existing clients turning to us to leverage the breadth of our capabilities. By going to market with an enterprise approach, we believe we have an incredible growth opportunity to gain share against firms that only have a singular focus. We are also focused on reimagining and repositioning our asset management platforms for growth. As the market continues to embrace new product types and asset classes, whether that be passive investments, the growth of alternatives, their place in more retail portfolios, we are increasing our choice of offering for our intermediary and OCIO clients. The continued consolidation and influx of private equity capital into the intermediary space creates disruption, but it can also create opportunity for SEI. for us to position the breadth of our solution offering to a broader range of segments and allow us to strategically invest in the future of advice. Michael Lane's addition to the SEI team is a tremendous win for us in this space and beyond. With our eyes on industry trends, we are confident that SEI's combination of stability, culture, balance sheet strength, client focus, and willingness to invest in innovation and scalable solutions will drive competitive differentiation and accelerated growth. We are focused on maximizing the enterprise value for our shareholders, and we are proud of the momentum we are seeing in the market and the enthusiasm we have across the workforce to rethink opportunities for SEI. Before concluding, I want to thank our SEI employees for our outstanding performance this quarter. You should take a moment to celebrate and reflect on what is possible. I congratulate everyone on their persistence, resilience, and willingness to embrace change. We still have a lot of work to do to realize our full potential, and we will not be satisfied until we are hitting on all cylinders across this company. And speaking of change, I'd like to welcome Michael Lane to our earnings call to make some brief remarks. Michael joined us last month from BlackRock to lead our investment management unit, advisor, and institutional businesses. As mentioned, I'm confident his experience, expertise, and leadership will help us reimagine asset management at FDI, capitalize on market opportunities, and accelerate our growth. Michael has already made an extremely positive contribution to the leadership team in its early days. Michael?