Westwood Holdings Group Inc

presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone. To remove yourself from the queue, you may press star 11 again. I would now like to hand the call over to Jill Meyer, Chief Legal Counsel. Please go ahead.

Thank you, and welcome to our third quarter 2025 earnings conference call. The following discussion will include forward-looking statements that are subject to known and unknown risks, uncertainties, and other factors, which may cause actual results to be materially different from those contemplated by the forward-looking statements. Additional information concerning the factors that could cause such a difference is included in our press release issued earlier today, as well as in our form 10-Q for the quarter-ended September 30th, 2025, that will be filed with the Securities and Exchange Commission. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. You are cautioned not to place undue reliance on forward-looking statements. In addition, in accordance with SEC rules concerning non-GAAP financial measures, the reconciliation of our economic earnings and economic earnings per share to the most comparable GAAP measures is included at the end of our press release issued earlier today. On the call today, we have Brian Casey, our Chief Executive Officer, and Terry Forbes, our Chief Financial Officer. I will now turn the call over to Brian Casey.

Good afternoon, and thank you for joining us for Westwood's third quarter 2025 earnings call. I'm pleased to share this quarter's results and key developments, as well as our outlook for the remainder of the year. Before we dive into the details, I'd like to highlight several key points from the quarter. Our enhanced midstream income ETF, MDST, surpassed $150 million in AUM. We recorded positive net flows in energy and real assets. Our private fundraising continues to exceed our annual goal by a significant margin. WEBS launched 11 new sector ETFs. Income Opportunity maintained its top decile since inception ranking and earned a Morningstar ratings upgrade to four stars. We've all witnessed a broad market rally this quarter driven by sustained enthusiasm for artificial intelligence, strong corporate earnings, and a pivotal interest rate cut by the Federal Reserve. Strength in cyclical areas like industrials and consumer discretionary all pointed to widespread confidence in economic growth. However, large cap gains remain highly concentrated in a handful of mega cap stocks. For small caps, the long-awaited rotation of leadership From large cap giants to smaller companies finally showed up, and once the Fed cuts rates in September, the bond market responded by sending Treasury yields lower. High yield and corporate credit outperformed government bonds as recession fears eased, and gold broke through $4,000 given the prospect of lower real yields and global U.S. dollar weakness. Turning to our long-term performance, our investment professionals delivered solid results across multiple strategies and asset classes. In our U.S. value strategies, our SMID cap strategy continues to post strong rankings and is firmly positioned in the top third over trailing three-year periods. Our multi-asset strategies continue to deliver compelling results. Our income opportunity and multi-asset income funds achieved top third rankings for the trailing three-year period and top half over the trailing five-year period in the Morningstar universe. Our income opportunity fund, WHGIX, also recently received a Morningstar ratings upgrade, to four stars. Within our salient strategies, our energy products continue to perform very well. Our MLP SMA strategy remains ahead of the Elyrian midstream index across trailing three-year and five-year periods. Enhanced midstream income, MDST, and enhanced energy income, WEEI, have delivered solid yields to income-focused investors. with MDST maintaining an annualized indicated dividend yield exceeding 10%, while WEEI has an indicated dividend yield of over 13%. As seasoned value investors, we seek to unlock opportunities in mispriced, misunderstood, and often less popular names. In times like these, fundamentals are often brushed aside, allowing for emotion and momentum to dominate. But as students of market history know, this stage of the current market cycle typically precedes periods when quality and value regain momentum. On balance, we remain cautiously optimistic with below-trend growth, sticky inflation, and elevated market valuations concentrated in a handful of mega-cap tech stocks. We believe that investment opportunities are shifting. Undervalued segments, especially small-cap stocks and the broader value style, are beginning to look more attractive. As markets evolve and investors rotate away from the most expensive segments, our focus on high-quality businesses with attractive relative valuations positions us well. Quality and attractive relative value have consistently outperformed across market cycles, and we fully expect this dynamic to reassert itself as the market environment matures. Our distribution channels delivered impressive results in the third quarter, building on the momentum we've established throughout the year. Year-to-date net sales through September 30th improved versus last year by 17%, and by 57% versus 2023. Our intermediary and institutional channels have contributed equally to this performance. Our institutional channel had negative net flows this quarter, primarily driven by sub-advisory business rebalancing. Our pipeline remains robust across value and energy strategies, with several new opportunities added during the quarter. Looking ahead in the institutional space, we anticipate winning more mandates in SMIDCAP for defined contribution plans, supported by the largest national consultants. We continue to have constructive meetings regarding our managed investment solutions capability, and there's continued interest in our energy offerings for both public and private strategies. We anticipate continued stability with our existing clients as we expand our presence with public plans, OCIOs, and single multifamily offices. The intermediary channel had particular success with our private fundraising initiative, which has so far exceeded our 2025 annual goal by 1.5 times through September 30th. And our private funds have earned approval on several broker-dealer platforms, further expanding our distribution capabilities. Our energy and real asset strategies continue to lead Westwood in both gross and net sales in 2025, and our enhanced midstream income ETF, MDST, continues to gain approvals from major national platforms. Putting it all together, the tailwinds in energy, combined with the breadth of Westwood offerings, are appealing to intermediary clients, particularly in the family office and RIA space. Our well-rounded offerings within the multi-asset and tactical suite of products are well-positioned to ride out equity market volatility. Our wealth management business, is on track to meet our client retention goals for the calendar year. We've reduced costs versus last year, and this trend will continue throughout the rest of the year. The operational efficiencies we're building will underpin early wins in 2026, and we're continuing to evaluate the best path to enhance our services as we move into 2026. Beyond our core business performance, several transformative initiatives and milestones demonstrate our continued commitment to innovation and strategic growth. Our ETF platform expansion. Our MDST ETF reached a significant milestone, surpassing $150 million in assets under management. MDST was the second best-selling fund compared to peer midstream funds in September, accounting for approximately 30% of midstream product ETF flows. Since inception, MDST has consistently delivered on its objective to provide a steady stream of monthly income, with an annualized distribution rate exceeding 10%. The fund's rapid growth and enthusiastic investor engagement underscore the increasing demand for innovative income-generating strategies in today's evolving market environment. WEBS innovation. Westwood and WEBS Investments launched 11 new sector funds during the quarter. The new WEBS defined volatility sector ETFs, a suite of 11 funds, which apply the defined volatility strategy to individual sectors within the S&P 500. By expanding this suite, we can offer investors more precise control over risk and sector exposure using a transparent framework that adjusts portfolio exposure based on real-time market volatility. Each fund tracks a defined volatility index created by Syntax, with each index providing investment exposure to an underlying select sector SPDR ETF. The WEBS flagship ETFs, DVSP and DVQQ, which launched late last year, demonstrated the effectiveness of a volatility-managed approach this past quarter. These ETFs also implement a rules-based strategy of volatility-adjusted exposure, adding market exposure when volatility is low and reducing market exposure when volatility is high. After underperforming their underlying ETFs, SPY and QQQ, during a very choppy first half that experienced elevated market volatility, our defined volatility approach really proved its worth this quarter. As volatility calmed down, DVSP outperformed SPY by 636 basis points, and DVQQ outperformed the QQQ by 726 basis points. In summary, we remain confident in our strategic positioning and the value we provide to our clients. Our year-to-date performance demonstrates meaningful progress with net sales improving. Our diversified platform, spanning traditional value strategies, innovative ETF products, energy and real asset solutions, custom index solutions, private investments, and wealth management services, positions us to take advantage quickly of evolving market dynamics. With strong long-term performance rankings across our multi-asset and energy strategies, growing momentum in both institutional and intermediary channels, and innovative new products gaining marketplace traction, we believe Westwood is well-positioned to deliver value to our clients and shareholders. Thank you for your continued support and confidence in Westwood. I will now turn the call over to CFO Terry Forbes.