Acadian Asset Management Inc.

Ladies and gentlemen, thank you for standing by. Welcome to the Cadian Assets Management Inc. Earnings Conference call and webcast for the first quarter 2025. During the call, all participants will be in listen-only mode. After the presentation, we will conduct a question and answer session. To be added to the queue, please press star followed by one at any time during the call. If you need to reach for an operator, please press star followed by zero. Please note that this call is being recorded today, Thursday, May 1st, 2025, at 11 a.m. Eastern Time. I would now like to turn the meeting over to Melody Wong, SVP, Director of Finance and Investor Relations. Please go ahead, Melody.

Good morning and welcome to Acadian Asset Management Inc's conference call to discuss our results for the first quarter ended March 31, 2025. Before we begin the presentation, please note that we may make forward-looking statements about our business and financial performance. Each forward-looking statement is subject to risks and uncertainties that could cause actual results to differ materially from those projected. Additional information regarding this risk and uncertainties appear in our SEC filings, including the Form 8K file today containing the earnings release and our 2024 Form 10K. Any forward-looking statements that we make on this call are based on assumptions as of today, and we undertake no obligation to update them as a result of new information of future events. We may also reference certain non-GAAP financial measures. Information about any non-GAAP measures referenced, including a reconciliation of those measures to GAAP measures, can be found on our website, along with the slides that we will use as part of today's discussion. Finally, nothing herein shall be deemed as an offer or solicitation to buy any investment products. Kelly Young. Our president and chief executive officer will leave the call. And now I'm pleased to turn the call over to Kelly.

Thanks, Melody. Good morning, everyone, and thanks for joining us today. We're very pleased with the path Acadian is on in 2025, and I'm excited to share our results for the first quarter with you. Acadian is the only pure play publicly traded systematic manager. Founded in 1986, Acadian has pioneered systematic investing, and we continue to lead the sector through constant innovation. We've delivered sustained outperformance across various investment strategies and through numerous market cycles. We manage $121.9 billion of AUM, and Acadian is a pure systematic manager, applying data and technology to the evaluation of global stocks and corporate bonds. 94% of our strategies by revenue are outperforming benchmarks over a five-year period, with 4.4% annualised excess return. Our competitive edge comes from the convergence of talented people, rich data and powerful tools, and we have a 120-person investment team with over 100 advanced analytical degrees. We're implementing product and distribution initiatives to drive sustainable growth. Slide 4 showcases Acadian Q1 2025 strong performance. Our net income attributable to controlling interest is up 38% compared to prior year, and US GAAP EPS is up 46%. ENI deleted EPS of 54 cents per share is up 23%, with adjusted EBITDA up 10%. We delivered 3.8 billion of positive net flows, our strongest quarter in 19 years. and finished with AUM of $121.9 billion as of 31st March 2025. Acadian's investment performance track record remains strong despite the market volatility. We have five major implementations which comprise the majority of our assets. As of 31st March 2025, global equity, emerging markets equity, non-US equity, small-cap equity, and our enhanced equity strategy have 100% of assets outperforming benchmarks across three, five, and 10-year periods with one minor variation. In Q1 of 2025, global equity markets experienced significant volatility amid a complex macroeconomic backdrop. While U.S. equities fell, European markets and emerging markets both rose, partly driven by dollar weakening. and investments outside of the U.S. provided significant diversification benefits for our clients' portfolios. Our disciplined, systematic investment process has generated meaningful long-term alpha for our clients. Our revenue-weighted five-year annualized returns in excessive benchmarks was 4.4% as of the end of Q1 of 2025 on a consolidated firm-wide basis. Our asset-weighted five-year annualized return in excessive benchmark was 3.5% as at the end of Q1. By revenue weight, more than 94% of Acadian strategies outperformed their respective benchmarks across three, five, and 10-year periods as of the end of March 2025. And by asset weight, more than 90% of Acadian strategies outperformed their respective benchmarks across three, five, and 10-year periods. Next, I'd like to focus on Acadian's extensive global distribution platform, which has helped us achieve strong growth sales and will be a major driver of growth in the years ahead. For many years, Acadian has had a strong global presence with four offices in Boston, London, Sydney, and Singapore. We have continued to expand our client and distribution team with over 90 experienced professionals serving more than a thousand client accounts in 40 countries. The team has established strong, deep relationships with many institutional clients and our average relationship length with our top 50 clients is over 10 years. We work with over 40 investment consultants across market segments and geographies leading to a diverse client base invested across multiple strategies. We had approximately $9 billion of gross sales in the first quarter of 2025 after achieving record annual sales of $21 billion in 2024. In tandem with expanding our distribution capabilities, Acadian's business and product development teams have been focused on increasing our strategy and vehicle offerings in high demand and growing areas, where Acadian's systematic approach is particularly well-suited, and our current pipeline is very robust. The success of Acadian as a highly regarded institutional investment manager is testament to our proven investment process, as well as Acadian's world-class investment and distribution team. We have six clients among the top 20 global asset owners and 27 clients among the top 50 US retirement plans. Over 50% of our assets are from clients invested in multiple Acadian strategies. Our client base is diverse with 37% of assets managed for clients outside of the US. We offer over 80 institutional quality funds for investors and achieved $8.8 billion of gross sales in Q1 of 2025. reaching 121.9 billion of assets under management as of the 31st of March 2025. The next slide highlights the positive trend in Acadian's net flows, showing a significant increase from the negative 2.3 billion in the full year of 2023 to the positive 1.8 billion in the full year for 2024 and reaching 3.8 billion in Q1 of this year. This was the highest quarterly MCCF that we've generated in 19 years. Our core strategies, such as global, non-US and EM equity, saw robustly inflows, and our newer strategies, such as enhanced equity and extension equity strategies, had meaningful positive flows in the first quarter of the year. As we discussed in our last earnings call, there are four key product initiatives in addition to our core strategies that we expect will drive Acadian's future growth. These are enhanced equity, extension equity, systematic credit, and equity alternatives, and we continue to make strong progress in these endeavors. Our enhanced equity strategies underscore the potential for strong future growth as the market opportunity is vast. Enhanced equity is one of Acadian's key product initiatives to drive long-term growth. Recent flows have been robust with end of Q1 2025 AUM of 12 billion, doubling from the prior year and expected to continue meaningful growth in the future. Enhanced equity strategies addressed investors' increasing demand for consistent, low-risk alpha at fees below those of fully-accessed strategies. These strategies appealed to a number of investors, including investors in the $16 trillion global passive equity market who were seeking improved performance with modest incremental risk. Our enhanced equity strategies repackage Acadian's alpha in a lower risk manner to meet market demand. These strategies leverage Acadian's proprietary investment process to invest in benchmark stocks and deliver attractive risk-adjusted returns with lower tracking error. And current notable implementations include the Russell 1000, MSCI Acqui, and the MSCI Emerging Market Indexes. Results have been robust, as shown on slide 13. Our enhanced equity targets stable alpha with low active risk and has produced consistent outperformance versus benchmark. In the chart below, we highlight the relationship between the monthly three-year annualized return of Acadian's enhanced global equity strategy versus that of the MSCI ACWI index's monthly three-year annualized return. We track the rolling return at each month's end from Enhanced Global Equity's inception date of September 2012 to the end of 2024. The solid line represents the index's returns. The dots representing the strategy returns are consistently close to or above the benchmark line, noting the outperformance since inception of the strategy at lower levels of tracking error than core strategies. Our enhanced equity strategies offer attractive risk-adjusted returns and can satisfy broader investment demand for lower fee and more consistent return characteristics. I'm now going to turn the call over to Melody to provide you with an update on capital allocation. Thanks, Kelly.