Virtus Investment Partners, Inc.

Good morning. My name is Gigi, and I will be your conference operator today. I would like to welcome everyone to the Virtus Investment Partners quarterly conference call. The slide presentation for this call is available in the investor relations section of the Virtus website, www.Virtus.com. This call is being recorded and will be available for replay on the Virtus website. At this time, all participants are in a listen-only mode. After the speaker's remarks, there will be a question and answer period, and instructions will follow at that time. I will now turn the conference to your host, Sean Rorick.

Thank you, and good morning, everyone. On behalf of Virtus Investment Partners, I'd like to welcome you to the discussion of our operating and financial results for the fourth quarter of 2021. Our speakers today are George Elward, President and CEO, and Mike Angerthal, Chief Financial Officer. Following their prepared remarks, we will have a Q&A period. Before we begin, please note the disclosures on page two of the slide presentation. Certain matters discussed on this call may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, and as such are subject to known and unknown risks and uncertainties, including but not limited to those factors set forth in today's news release and discussed in our SEC filings. These risks and uncertainties may cause actual results to differ materially from those discussed in the statements. In addition to results presented on a GAAP basis, we use certain non-GAAP measures to evaluate our financial results. Our non-GAAP financial measures are not substitutes for GAAP financial results and should be read in conjunction with the GAAP results. Reconciliations of these non-GAAP financial measures, the applicable GAAP measures are included in today's news release and financial supplement, which are available on our website. Now I would like to turn the call over to George. George?

Thank you, Sean. Good morning, everyone. I will start today with an overview of the results we reported this morning, and then Mike will provide more detail. We are pleased with the significant strategic and financial accomplishments of the past year, which presents us well to navigate what may be a challenging market environment in 2022. Over the past year, we have meaningfully increased scale with assets under management up by more than 40%, generated positive organic growth for the second consecutive year, delivered our highest levels of operating profitability and earnings per share, significantly increase cash flow, including nearly doubling EBITDA to $440 million, increase return of capital through higher share repurchases and a meaningful increase in our dividend, and finalize three strategic and highly differentiated transactions, including Stone Harbor Investment Partners on January 1st, which adds $14.7 billion of emerging markets debt and multi-asset credit strategies, and the talented team that we are excited to welcome as a new affiliate. The strategic transactions, which also include Allianz GI and Westchester Capital, added nearly $50 billion of assets under management in complementary and differentiated investment strategies and enhanced our distribution breadth and capabilities. These transactions were executed with existing balance sheet resources and meaningfully increased our cash flow generation. We ended the year in a net cash position, providing ongoing flexibility to invest in the business and continue to return capital to shareholders. For the fourth quarter specifically, we delivered very strong financial and operating results, including our highest level of earnings per share as adjusted, a 50% operating margin, continued strong investment performance, positive net flows in retail separate accounts, ETFs, and institutional, and continued return of capital, including an increase in our level of share repurchases. Turning to a review of these results, Total assets earned in management were $187.2 billion, up 14% from September 30th due to market performance and the addition of Westchester Capital, which closed on October 1st. Sales momentum increased with $8.7 billion of inflows, up sequentially from $7.6 billion, and with growth in all product categories. Net flows were essentially break-even as ongoing positive organic growth in retail separate accounts, institutional and ETFs, was offset by open-end fund net outflows. By product, retail separate accounts generated positive net flows for the 15th consecutive quarter with an 11% organic growth rate. Institutional net flows were positive for the 5th consecutive quarter with continued traction at multiple affiliates and from both existing mandates and new accounts. ETFs generated positive net flows for the 6th consecutive quarter with and open-end net flows were negative, consistent with industry trends, and largely due to outflows from emerging market and domestic growth equity strategies. In terms of the flows we saw in January, the fourth quarter trends continued, including positive flows in retail separate accounts, institutional, and ETFs. In open-end funds, international and domestic equity strategies continued to be in net outflows, and we are still seeing positive net flows into alternatives and bank loan strategies where inflows have accelerated. Our financial results for the quarter reflected AUM growth and the benefits of our variable expense structure. Operating income has adjusted and increased by 6% sequentially to $117 million, and the related margin of 50.2% was relatively consistent with the prior quarter and up nearly 10 percentage points from the prior year period. Earnings per share has adjusted and increased 7% sequentially to $10.36 and our highest reported level, primarily due to higher revenues. Turning now to capital, during the quarter we increased the level of stock buybacks, repurchasing approximately 82,000 shares for $25 million, up from $20 million in the prior quarter. Our balance sheet remains strong, and we ended the quarter in a net cash position as we continue to generate significant cash flow. With that, I'll turn the call over to Mike. Mike?