Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Feb. 21, 2020 | Jun. 30, 2019 | |
Document and Entity Information | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2019 | ||
Document Transition Report | false | ||
Entity File Number | 001-38103 | ||
Entity Registrant Name | JANUS HENDERSON GROUP PLC | ||
Entity Incorporation, State or Country Code | Y9 | ||
Entity Tax Identification Number | 98-1376360 | ||
Entity Address, Address Line One | 201 Bishopsgate | ||
Entity Address, City or Town | London | ||
Entity Address, Country | GB | ||
Entity Address, Postal Zip Code | EC2M3AE | ||
Country Region | +44 | ||
City Area Code | (0) 20 | ||
Local Phone Number | 7818 1818 | ||
Title of 12(b) Security | Common Stock | ||
Trading Symbol | JHG | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 4,101,251,620.80 | ||
Entity Common Stock, Shares Outstanding | 186,975,693 | ||
Entity Central Index Key | 0001274173 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Investment securities | $ 253.5 | $ 291.8 |
Fees and other receivables | 334.8 | 309.2 |
OEIC and unit trust receivables | 131.7 | 144.4 |
Other current assets | 116 | 69.4 |
Total current assets | 2,580.8 | 2,019.1 |
Non-current assets: | ||
Property, equipment and software, net | 84.7 | 69.5 |
Intangible assets, net | 3,088.6 | 3,123.3 |
Goodwill | 1,504.3 | 1,478 |
Retirement benefit asset, net | 214 | 206.5 |
Other non-current assets | 149.3 | 15.5 |
Total assets | 7,621.7 | 6,911.9 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 246 | 233.2 |
Current portion of accrued compensation, benefits and staff costs | 335.7 | 345.4 |
OEIC and unit trust payables | 130.9 | 143.3 |
Total current liabilities | 769.7 | 728.4 |
Non-current liabilities: | ||
Accrued compensation, benefits and staff costs | 59.4 | 54.7 |
Long-term debt | 316.2 | 319.1 |
Deferred tax liabilities, net | 729.1 | 729.9 |
Retirement benefit obligations, net | 4.4 | 3.7 |
Other non-current liabilities | 158.8 | 79.2 |
Total liabilities | 2,037.6 | 1,915 |
Commitments and contingencies (See Note 19) | ||
REDEEMABLE NONCONTROLLING INTERESTS | 677.9 | 136.1 |
EQUITY | ||
Common stock ($1.50 par, 480,000,000 shares authorized and 186,975,693 and 196,412,764 shares issued and outstanding as of December 31, 2019 and 2018, respectively) | 280.5 | 294.6 |
Additional paid-in-capital | 3,828.5 | 3,824.5 |
Treasury shares (3,545,812 and 4,523,802 shares held, respectively) | (139.5) | (170.8) |
Accumulated other comprehensive loss, net of tax | (367.1) | (423.5) |
Retained earnings | 1,284.1 | 1,314.5 |
Total shareholders' equity | 4,886.5 | 4,839.3 |
Nonredeemable noncontrolling interests | 19.7 | 21.5 |
Total equity | 4,906.2 | 4,860.8 |
Total liabilities, redeemable noncontrolling interests and equity | 7,621.7 | 6,911.9 |
Consolidated excluding VIEs | ||
Current assets: | ||
Cash and cash equivalents | 733.9 | 880.4 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 246 | 233.2 |
Consolidated VIEs | ||
Current assets: | ||
Cash and cash equivalents | 62.6 | 36.2 |
Investment securities | 924.8 | 282.7 |
Other current assets | 23.5 | 5 |
Current liabilities: | ||
Accounts payable and accrued liabilities | $ 57.1 | $ 6.5 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) | Dec. 31, 2019£ / sharesshares | Dec. 31, 2019$ / sharesshares | Dec. 31, 2018$ / sharesshares |
CONSOLIDATED BALANCE SHEETS | |||
Common stock, par (in dollars per share) | (per share) | £ 1.50 | $ 1.50 | $ 1.50 |
Common stock, shares authorized | 480,000,000 | 480,000,000 | 480,000,000 |
Common stock, shares issued | 186,975,693 | 186,975,693 | 196,412,764 |
Common stock, shares outstanding | 186,975,693 | 186,975,693 | 196,412,764 |
Treasury shares (in shares) | 3,545,812 | 3,545,812 | 4,523,802 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenue: | |||
Total revenue | $ 2,192.4 | $ 2,306.4 | $ 1,818.3 |
Operating expenses: | |||
Employee compensation and benefits | 602.5 | 613 | 543.3 |
Long-term incentive plans | 184.3 | 188.6 | 150.8 |
Distribution expenses | 444.3 | 446.7 | 351.9 |
Investment administration | 47.9 | 46.9 | 43.8 |
Marketing | 31.1 | 37.9 | 31.2 |
General, administrative and occupancy | 260.8 | 253.7 | 202.2 |
Depreciation and amortization | 80.6 | 69.8 | 52.8 |
Total operating expenses | 1,651.5 | 1,656.6 | 1,376 |
Operating income | 540.9 | 649.8 | 442.3 |
Interest expense | (15.1) | (15.7) | (11.9) |
Investment gains (losses), net | 34.2 | (40.9) | 18 |
Other non-operating income (expenses), net | 23.5 | 68.6 | (1) |
Income before taxes | 583.5 | 661.8 | 447.4 |
Income tax (provision) benefit | (137.8) | (162.2) | 211 |
Net income | 445.7 | 499.6 | 658.4 |
Net loss (income) attributable to noncontrolling interests | (18.1) | 24.2 | (2.9) |
Net income attributable to JHG | $ 427.6 | $ 523.8 | $ 655.5 |
Earnings per share attributable to JHG common shareholders: | |||
Basic (in dollars per share) | $ 2.21 | $ 2.62 | $ 3.97 |
Diluted (in dollars per share) | $ 2.21 | $ 2.61 | $ 3.93 |
Other comprehensive income, net of tax: | |||
Foreign currency translation gains (losses) | $ 74.7 | $ (124.3) | $ 125 |
Net unrealized losses on available-for-sale securities | (2) | ||
Actuarial gains (losses) | (5.6) | 3.7 | (11.1) |
Other comprehensive income (loss), net of tax | 69.1 | (120.6) | 111.9 |
Other comprehensive loss (income) attributable to noncontrolling interests | (12.7) | 1.4 | 20.8 |
Other comprehensive income (loss) attributable to JHG | 56.4 | (119.2) | 132.7 |
Total comprehensive income | 514.8 | 379 | 770.3 |
Total comprehensive loss (income) attributable to noncontrolling interests | (30.8) | 25.6 | 17.9 |
Total comprehensive income attributable to JHG | 484 | 404.6 | 788.2 |
Management fees | |||
Revenue: | |||
Total revenue | 1,792.3 | 1,947.4 | 1,480.9 |
Performance fees | |||
Revenue: | |||
Total revenue | 17.6 | 7.1 | 103.9 |
Shareowner servicing fees | |||
Revenue: | |||
Total revenue | 185.4 | 154.2 | 87.3 |
Other revenue | |||
Revenue: | |||
Total revenue | $ 197.1 | $ 197.7 | $ 146.2 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Operating activities: | |||
Net income | $ 445.7 | $ 499.6 | $ 658.4 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 62.6 | 62.6 | 52.8 |
Impairment of intangible asset | 18 | 7.2 | |
Deferred income taxes | (4.7) | (10.5) | (355.6) |
Stock-based compensation plan expense | 74.2 | 82.4 | 67.4 |
Gains from equity-method investments, net | 0.6 | ||
Impairment of ROU operating asset | 4.7 | ||
Investment (gains) losses, net | (34.2) | 40.9 | (18) |
Contingent consideration fair value adjustment | (20) | ||
Contributions to pension plans in excess of costs recognized | 1 | (16.1) | (20.9) |
Gain from BNP Paribas transaction | (22.3) | ||
Dai-ichi option fair value adjustments | (26.8) | ||
Other, net | (11.1) | 4.8 | 7.2 |
Changes in operating assets and liabilities: | |||
OEIC and unit trust receivables and payables | 0.4 | 3.9 | (0.9) |
Other assets | (16.4) | 134.5 | (117.8) |
Other accruals and liabilities | (57) | (89.4) | 170.9 |
Net operating activities | 463.2 | 670.8 | 444.1 |
Investing activities: | |||
Cash acquired from acquisition of JCG | 417.2 | ||
Proceeds from (purchase of): | |||
Investment securities, net | 1.5 | 35.1 | 7.5 |
Property, equipment and software | (37.8) | (29.1) | (17.7) |
Investment income received by consolidated funds | 7.9 | ||
Cash movement on deconsolidation of consolidated funds | (11.2) | ||
Proceeds from BNP Paribas transaction, net | 36.5 | ||
Cash received (paid) on settled hedges, net | (34.9) | 16 | (23.7) |
Dividends received from equity-method investments | 0.4 | 0.2 | |
Dividends attributable to noncontrolling interests | (2.6) | ||
Proceeds from sale of Volantis | 2.3 | 5.9 | 0.5 |
Net investing activities | (389.3) | 100.9 | 519.5 |
Financing activities: | |||
Settlement of convertible note hedge | 59.3 | ||
Settlement of stock warrant | (47.8) | ||
Proceeds from issuance of options | 25.7 | ||
Proceeds from stock-based compensation plans | 8.6 | 6 | |
Purchase of common stock for stock-based compensation plans | (39) | (86.6) | (52.1) |
Purchase of common stock for share buyback program | (199.9) | (99.8) | |
Dividends paid to shareholders | (272.4) | (275.1) | (256) |
Repayment of long-term debt | (95.3) | (92.5) | |
Payment of contingent consideration | (14.1) | (22.7) | |
Distributions to noncontrolling interests | (1.3) | (8.1) | (5) |
Third-party sales (redemptions) in consolidated seeded investment products, net | 320.8 | (36.5) | (141.4) |
Principal payments under capital lease obligations | (1.1) | (1.3) | (0.9) |
Net financing activities | (207) | (616.8) | (504.7) |
Cash and cash equivalents: | |||
Effect of foreign exchange rate changes | 13 | (32.5) | 12.1 |
Net change | (120.1) | 122.4 | 471 |
At beginning of period | 916.6 | 794.2 | 323.2 |
At end of period | 796.5 | 916.6 | 794.2 |
Supplemental cash flow information: | |||
Cash paid for interest | 14.6 | 14.8 | 8 |
Cash paid for income taxes, net of refunds | 160 | 184.7 | 113.1 |
Reconciliation of cash and cash equivalents: | |||
Cash and cash equivalents | 916.6 | 794.2 | 794.2 |
Consolidated VIEs | |||
Proceeds from (purchase of): | |||
Investment securities by consolidated seeded investment products, net | (320.8) | 36.5 | 141.4 |
Cash and cash equivalents: | |||
At beginning of period | 36.2 | 34.1 | |
At end of period | 62.6 | 36.2 | 34.1 |
Reconciliation of cash and cash equivalents: | |||
Cash and cash equivalents | 36.2 | 34.1 | 34.1 |
Consolidated excluding VIEs | |||
Cash and cash equivalents: | |||
At beginning of period | 880.4 | 760.1 | |
At end of period | 733.9 | 880.4 | 760.1 |
Reconciliation of cash and cash equivalents: | |||
Cash and cash equivalents | $ 880.4 | $ 760.1 | $ 760.1 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) $ in Millions | Common stock | Additional paid-in-capital | Treasury shares | Accumulated other comprehensive loss | Retained earnings | Nonredeemable noncontrolling interests | Total |
Balance at Dec. 31, 2016 | $ 234.4 | $ 1,237.9 | $ (155.1) | $ (434.5) | $ 764.8 | $ 44.8 | $ 1,692.3 |
Balance (in shares) at Dec. 31, 2016 | 1,131,800,000 | ||||||
Increase (Decrease) in Stockholders' Equity | |||||||
Share consolidation (in shares) | (1,018,600,000) | ||||||
Net income | 655.5 | 1.5 | 657 | ||||
Other comprehensive income (loss) | 132.7 | (20.8) | 111.9 | ||||
Dividends paid to shareholders | 0.1 | (256) | (255.9) | ||||
Distributions to noncontrolling interests | (0.6) | (0.6) | |||||
Derivative instruments acquired on acquisition | 31.4 | 31.4 | |||||
Noncontrolling interests recognized on acquisition of JCG | 13.3 | 13.3 | |||||
Fair value adjustments to redeemable noncontrolling interests | (0.4) | (0.4) | |||||
Adjust consideration for post combination services under unvested stock-based compensation plans | (51.8) | (51.8) | |||||
Redemptions of convertible debt and settlement of derivative instruments | (22.3) | (22.3) | |||||
Tax impact of convertible debt redemptions and settlement of derivative instruments | (2.7) | (2.7) | |||||
Purchase of common stock for stock-based compensation plans | (52.1) | (52.1) | |||||
Issuance of common stock | $ 130.8 | 2,551.2 | 2,682 | ||||
Issuance of common stock (in shares) | 87,200,000 | ||||||
Redenomination and reduction of par value of stock | $ (64.6) | 64.6 | |||||
Vesting of stock-based compensation plans | (29) | 51.4 | (22.4) | ||||
Stock-based compensation plan expense | 57.5 | 9.9 | 67.4 | ||||
Proceeds from stock-based compensation plans | 6 | 6 | |||||
Balance at Dec. 31, 2017 | $ 300.6 | 3,842.9 | (155.8) | (301.8) | 1,151.4 | 38.2 | 4,875.5 |
Balance (in shares) at Dec. 31, 2017 | 200,400,000 | ||||||
Increase (Decrease) in Stockholders' Equity | |||||||
Cumulative-effect adjustment of change in accounting principle | (2.5) | 2.7 | 0.2 | ||||
Adjusted balance at December 31, 2017 | $ 300.6 | 3,842.9 | (155.8) | (304.3) | 1,154.1 | 38.2 | 4,875.7 |
Net income | 523.8 | (9.1) | 514.7 | ||||
Other comprehensive income (loss) | (119.2) | (119.2) | |||||
Dividends paid to shareholders | 0.2 | (270.4) | (270.2) | ||||
Share buyback program | $ (6) | (93.8) | (99.8) | ||||
Share buyback program (in shares) | (4,000,000) | ||||||
Distributions to noncontrolling interests | (7.6) | (7.6) | |||||
Fair value adjustments to redeemable noncontrolling interests | 0.8 | 0.8 | |||||
Redemptions of convertible debt and settlement of derivative instruments | (38) | (38) | |||||
Purchase of common stock for stock-based compensation plans | (37.5) | (49.1) | (86.6) | ||||
Vesting of stock-based compensation plans | (34.1) | 34.1 | |||||
Stock-based compensation plan expense | 82.4 | 0 | 82.4 | ||||
Proceeds from stock-based compensation plans | 8.6 | 8.6 | |||||
Balance at Dec. 31, 2018 | $ 294.6 | 3,824.5 | (170.8) | (423.5) | 1,314.5 | 21.5 | $ 4,860.8 |
Balance (in shares) at Dec. 31, 2018 | 196,400,000 | 196,412,764 | |||||
Increase (Decrease) in Stockholders' Equity | |||||||
Net income | 427.6 | (1.1) | $ 426.5 | ||||
Other comprehensive income (loss) | 56.4 | 56.4 | |||||
Dividends paid to shareholders | 0.1 | (272.5) | (272.4) | ||||
Share buyback program | $ (14.1) | (185.8) | (199.9) | ||||
Share buyback program (in shares) | (9,400,000) | ||||||
Distributions to noncontrolling interests | (0.7) | (0.7) | |||||
Fair value adjustments to redeemable noncontrolling interests | 0.3 | 0.3 | |||||
Purchase of common stock for stock-based compensation plans | (33.8) | (5.2) | (39) | ||||
Vesting of stock-based compensation plans | (36.5) | 36.5 | |||||
Stock-based compensation plan expense | 74.2 | 0 | 74.2 | ||||
Balance at Dec. 31, 2019 | $ 280.5 | $ 3,828.5 | $ (139.5) | $ (367.1) | $ 1,284.1 | $ 19.7 | $ 4,906.2 |
Balance (in shares) at Dec. 31, 2019 | 187,000,000 | 186,975,693 |
CONSOLIDATED STATEMENTS OF CH_2
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Parenthetical) | 12 Months Ended | |||
Dec. 31, 2019$ / shares | Dec. 31, 2018$ / shares | Dec. 31, 2017$ / shares | Dec. 31, 2017£ / shares | |
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY | ||||
Dividends paid (per share) | (per share) | $ 1.44 | $ 1.40 | $ 0.64 | £ 0.0915 |
Description of the Business
Description of the Business | 12 Months Ended |
Dec. 31, 2019 | |
Description of the Business | |
Description of the Business | N ote 1 — D escription of the B usiness As used herein, “JHG,” “we,” "us,” “our” and similar terms refer to Janus Henderson Group plc and its subsidiaries, unless indicated otherwise. JHG is an independent global asset manager, specializing in active investment across all major asset classes. We actively manage a broad range of investment products for institutional and retail investors across five capabilities: Equities, Fixed Income, Quantitative Equities, Multi-Asset and Alternatives. JHG is a public limited company incorporated in Jersey, Channel Islands, and is tax-resident and domiciled in the UK. Our common stock is traded on the NYSE and our CDIs are traded on the ASX. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | N ote 2 — S ummary of S ignificant A ccounting P olicies Basis of Presentation Our consolidated financial statements have been prepared according to U.S. GAAP and include all majority-owned subsidiaries and consolidated seeded investment products. Intercompany accounts and transactions have been eliminated in consolidation. Events subsequent to the balance sheet date have been evaluated for inclusion in the accompanying consolidated financial statements through the issuance date. Prior to the Merger, Henderson’s functional currency was GBP. After consideration of numerous factors, such as the denomination of its shares, payments of dividends and our main economic environment, management concluded that the post-Merger functional currency of JHG is USD. Certain prior year amounts in our Consolidated Statements of Comprehensive Income have been reclassified to conform to current year presentation. Specifically, revenue amounts related to certain transfer agent and administrative activities performed for investment products that were previously classified in other revenue were reclassified to shareowner servicing fees. There is no change to consolidated total revenue, operating income, net income or cash flows as a result of this change in classification. Accounting Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates and the differences could be material. Our significant estimates relate to investment securities, acquisition accounting, goodwill and intangible assets, retirement benefit assets and obligations, contingent consideration, equity compensation and income taxes. Segment Information We are a global asset manager and manage a range of investment products, operating across various product lines, distribution channels and geographic regions. However, resources are allocated and the business is managed by the chief operating decision-maker, the CEO, on an aggregated basis. Strategic and financial management decisions are determined centrally by the CEO and, on this basis, we operate as a single segment investment management business. Consolidation of Investment Products We perform periodic consolidation analyses of our seeded investment products to determine if the product is a VIE or a VRE. Factors considered in this assessment include the product’s legal organization, the product’s capital structure and equity ownership, and any de facto agent implications of our involvement with the product. Investment products that are determined to be VIEs are consolidated if we are the primary beneficiary of the product. VREs are consolidated if we hold the majority voting interest. Upon the occurrence of certain events (such as contributions and redemptions, either by JHG or third parties, or amendments to the governing documents of our investment products), management reviews and reconsiders its previous conclusion regarding the status of a product as a VIE or a VRE. Additionally, management continually reconsiders whether we are considered a VIE’s primary beneficiary, and thus consolidates such product. Variable Interest Entities Certain investment products for which a controlling financial interest is achieved through arrangements that do not involve or are not directly linked to voting interests are considered VIEs. We review factors, including whether or not (i) the product has equity that is sufficient to permit it to finance its activities without additional subordinated support from other parties and (ii) the equity holders at risk have the obligation to absorb losses, the right to receive residual returns and the right to direct the activities of the product that most significantly impact the product’s economic performance, to determine if the investment product is a VIE. We re-evaluate such factors as facts and circumstances change. We consolidate a VIE if we are the VIE’s primary beneficiary. The primary beneficiary of a VIE is defined as the variable interest holder that has a controlling financial interest in the VIE. A controlling financial interest is defined as (i) the power to direct the activities of the VIE that most significantly impact its economic performance and (ii) the obligation to absorb losses of the product or the right to receive benefits from the product that potentially could be significant to the VIE. We are the manager of various types of seeded investment products, which may be considered VIEs. Our involvement in financing the operations of the VIEs is generally limited to its investments in the products. VIEs are generally subject to consolidation by us at lower ownership percentages than the 50% threshold applied to VREs and are also subject to specific disclosure requirements. Voting Rights Entities We consolidate seeded investment products accounted for as VREs when we are considered to control such products, which generally exists if we have a greater than 50% voting equity interest. Property, Equipment and Software Property, equipment and software are recorded at cost. Depreciation is recorded using the straight-line method over the estimated useful life of the related assets (or the lease term, if shorter). Depreciation expense totaled $23.5 million, $24.7 million and $24.6 million for the years ended December 31, 2019, 2018 and 2017, respectively. Property, equipment and software are summarized as follows (in millions): Depreciation December 31, period 2019 2018 Furniture, fixtures and computer equipment 3-10 years $ 36.1 $ 31.3 Leasehold improvements Over the shorter of 20 years or the period of the lease 38.0 35.3 Computer software 3-7 years 83.1 65.6 Property, equipment and software, gross $ 157.2 $ 132.2 Accumulated depreciation (72.5) (62.7) Property, equipment and software, net $ 84.7 $ 69.5 Computer software is recorded at cost and depreciated over its estimated useful life. Internal and external costs incurred in connection with researching or obtaining computer software for internal use are expensed as incurred during the preliminary project stage, as are post-implementation training and maintenance costs. Internal and external costs incurred for internal use software during the application development stage are capitalized until such time that the software is substantially complete and ready for its intended use. Application development stage costs are depreciated on a straight-line basis over the estimated useful life of the software. We evaluate our property, equipment and software assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The evaluation is based on an estimate of the future cash flows expected to result from the use of the asset and its eventual disposal. If expected future undiscounted cash flows are less than the carrying amount of the asset, an impairment loss is recognized in an amount equal to the excess of the carrying amount of the asset over the fair value of the asset. There were no impairments of property, equipment and software for the years ended December 31, 2019, 2018 and 2017. Deferred Commissions Initial sales commissions paid to and received from financial intermediaries on sales of certain wholesale products are deferred and amortized over various periods, not exceeding four years. The amortization period is based on the average expected life of the product on which the commission is received. Deferred commissions are recognized as components of other current assets and of accounts payable and accrued liabilities on the Consolidated Balance Sheets. Equity Method Investments Our investment in equity method investees, where we do not control the investee but can exert significant influence over the financial and operating policies (generally considered to be ownership between 20% and 50%), as well as in joint ventures where there is joint control (and in both cases, where we are not the primary beneficiary of a VIE), are accounted for using the equity method of accounting. Investments are initially recognized at cost when purchased for cash, or at the fair value of shares received where acquired as part of a wider transaction. The investments are subsequently carried at cost adjusted for our share of net income or loss and other changes in comprehensive income of the equity method investee, less any dividends or distributions received by us. The Consolidated Statements of Comprehensive Income includes our share of net income or loss for the year, or period of ownership, if shorter, within other non-operating income (expenses), net. Financial Instruments Financial assets are recognized at fair value in the Consolidated Balance Sheets when we become a party to the contractual provisions of an instrument. The fair value recognized is adjusted for transaction costs, except for financial assets classified as trading where transaction costs are recognized immediately in net income. Financial assets are derecognized when the rights to receive cash flows from the investments have expired or where they have been transferred and we have also transferred substantially all the risks and rewards of ownership. Purchases and sales of financial assets are recognized at the trade date. Delivery and settlement terms are usually determined by established practices in the market concerned. Debt securities, equity securities and holdings in pooled funds are measured at subsequent reporting dates at fair value. We determine the classification of its financial assets on initial recognition. Unrealized gains and losses represent the difference between the fair value of the financial asset at the reporting date and cost or, if these have been previously revalued, the fair value at the last reporting date. Realized gains and losses on financial assets are calculated as the difference between the net sales proceeds and cost or amortized cost using the specific identification method. Financial liabilities, excluding contingent consideration, derivatives, fund deferral liabilities and redeemable noncontrolling interests in consolidated funds which are stated at fair value, are stated at amortized cost using the effective interest rate method. Financial liabilities stated at amortized cost include our long-term debt. Amortized cost is calculated by taking into account any issue costs and any discount or premium on settlement. Financial liabilities cease to be recognized when the obligation under the liability has been discharged or cancelled or has expired. Investment Securities Seeded Investment Products We periodically add new investment strategies to our investment product offerings by providing the initial cash investment or “seeding.” The primary purpose of seeded investment products is to generate an investment performance track record in a product to attract third-party investors. Seeded investment products are initially consolidated and the individual securities within the portfolio are accounted for as trading securities. The change in fair value of seeded investment products is recorded in investment gains (losses), net on our Consolidated Statements of Comprehensive Income. Noncontrolling interests in seeded investment products represent third-party ownership interests and are included in investment securities on our Consolidated Balance Sheets. These assets are not available for general corporate purposes and may be redeemed by the third parties at any time. Refer to the consolidation discussion in this note for information regarding the consolidation of certain seeded investment products. We may redeem invested seed capital for a variety of reasons, including when third-party investments in the relevant product are sufficient to sustain the given investment strategy. The length of time we hold a majority interest in a product varies based on a number of factors, including market demand, market conditions and investment performance. Investments in Advised Mutual Funds and Investments Related to the Economic Hedging of Deferred Compensation We grant mutual fund share awards to employees that are indexed to certain funds managed by us. Upon vesting, participants receive the value of the mutual fund share awards adjusted for gains or losses attributable to the mutual funds to which the award was indexed, subject to tax withholding, or participants receive shares in the mutual fund. When investments in our fund products are purchased and held against deferred compensation liabilities, any movement in the fair value of the assets and corresponding movements in the deferred compensation liability are recognized in the Consolidated Statements of Comprehensive Income. We maintain deferred compensation plans for certain highly compensated employees and members of its Board of Directors. Eligible participants may defer a portion of their compensation and have the ability to earn a return by indexing their deferrals to mutual funds managed by us and our subsidiaries. We make no contributions to the plans. To protect against market variability of the liability, we create an economic hedge by investing in mutual funds that are consistent with the deferred amounts and mutual fund elections of the participants. Such investments remain assets of JHG. Changes in market value of the liability to participants are recognized as long-term incentive compensation in our Consolidated Statements of Comprehensive Income, and changes in the market value of the mutual fund securities are recognized in investment gains (losses), net on our Consolidated Statements of Comprehensive Income. Other Investment Securities Other investment securities primarily represent investments in our fund products held by employee benefit trusts, certain investments in unconsolidated seed capital investments and certain investments in consolidated funds. Gains and losses arising from changes in the fair value of these securities are included within investments gains (losses), net in the Consolidated Statements of Comprehensive Income. Where investments in our fund products are held against outstanding deferred compensation liabilities, any movement in the fair value of these assets and corresponding movements in the deferred compensation liability are recognized in the Consolidated Statements of Comprehensive Income. Trade Receivables Trade receivables, which generally have 30-day payment terms, are initially recognized at fair value, which is normally equivalent to the invoice amount. When the time value of money is material, the fair value is discounted. Provision for specific doubtful accounts is made when there is evidence that we may not be able to recover balances in full. Balances are written off when the receivable amount is deemed uncollectable. OEIC and Unit Trust Receivables and Payables OEIC and unit trust receivables and payables are in relation to the purchase of units/shares (by investors) and the liquidation of units/shares (owned by trustees). The amounts are dependent on the level of trading and fund switches in the four working days leading up to the end of the period. Since they are held with different counterparties, the amounts are presented gross on our Consolidated Balance Sheets. Cash and Cash Equivalents Cash and cash equivalents primarily consist of cash held at banks, on-demand deposits, highly liquid short-term government securities and investments in money market instruments with a maturity date of three months or less. Cash balances maintained by consolidated VREs are not considered legally restricted and are included in cash and cash equivalents on the Consolidated Balance Sheets. Cash balances held by consolidated VIEs are disclosed separately as a component of assets of consolidated VIEs on the Consolidated Balance Sheets. Derivative Instruments We may, from time to time, use derivative financial instruments to mitigate price, interest rate, foreign currency and credit risk. We do not designate derivative instruments as hedges for accounting purposes, with the exception of certain foreign currency forward contracts used for net investment hedging. Derivative instruments are measured at fair value and classified as either other current assets or accounts payable and accrued liabilities on our Consolidated Balance Sheets. Changes in the fair value of derivative instruments are recorded within investment gains (losses), net in our Consolidated Statements of Comprehensive Income. Changes in fair value of foreign currency forward contracts designated as hedges for accounting purposes are recognized in accumulated other comprehensive income under net investment hedge accounting. Our consolidated seed investments may also be party to derivative instruments. These derivative instruments are disclosed separately from our corporate derivative instruments. Refer to Note 6 – Investment Securities. Leases We determine if an arrangement is a lease at inception. Operating lease right-of-use (“ROU”) assets are included in other non-current assets in our Consolidated Balance Sheets. The current and non-current portions of operating lease liabilities are included in accounts payable and accrued liabilities and in other non-current liabilities, respectively. Finance lease ROU assets are included in property, equipment and software, net, and finance lease liabilities are included in other non-current liabilities. ROU assets represent our right to use an underlying asset for the lease term, and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that the option will be exercised. Lease expense for lease payments is recognized on a straight-line basis over the lease term. Nonredeemable Noncontrolling Interests and Redeemable Noncontrolling Interests Nonredeemable noncontrolling interests that are not subject to redemption rights are classified in permanent equity. Redeemable noncontrolling interests are classified outside of permanent equity on the Consolidated Balance Sheets and are measured at the estimated fair value as of the balance sheet date. Noncontrolling interests in consolidated seed investments are classified as redeemable noncontrolling interests where there is an obligation on the fund to repurchase units at the investor’s request. Refer to Note 14 – Noncontrolling Interests for further information. Fair Value Measurements Fair value is the price that would be received to sell an asset or transfer a liability in an orderly transaction between market participants at the measurement date. The fair value of financial instruments traded in active markets (such as publicly traded securities and derivatives) is based on quoted market prices at the reporting date. The quoted market price used for financial instruments is the last traded market price for both financial assets and financial liabilities where the last traded price falls within the bid ask spread. In circumstances where the last traded price is not within the bid ask spread, management will determine the point within the bid ask spread that is most representative of fair value current bid price. The fair value of financial instruments that are not traded in an active market is determined using valuation techniques commonly used by market participants, including the use of comparable recent arm’s length transactions, discounted cash flow analysis and option pricing models. Estimating fair value requires significant management judgment, including benchmarking to similar instruments with observable market data and applying appropriate discounts that reflect differences between the securities that we are valuing and the selected benchmark. Measurements of fair value are classified within a hierarchy that prioritizes the inputs to valuation techniques used to measure fair value based on whether the inputs to those valuation techniques are observable or unobservable. The valuation hierarchy contains three levels: ● Level 1—Valuation inputs are unadjusted quoted market prices for identical assets or liabilities in active markets. ● Level 2—Valuation inputs are quoted market prices for identical assets or liabilities in markets that are not active, quoted market prices for similar assets and liabilities in active markets, and other observable inputs directly or indirectly related to the asset or liability being measured. ● The valuation of an asset or liability may involve inputs from more than one level of the hierarchy. The level in the fair value hierarchy within which a fair value measurement in its entirety falls is determined based on the lowest level input that is significant to the fair value measurement. Level 1 Fair Value Measurements Our Level 1 fair value measurements consist mostly of seeded investment products, investments in advised mutual funds, cash equivalents and investments related to deferred compensation plans with quoted market prices in active markets. The fair value level of consolidated seeded investment products is determined by the underlying securities of the product. The fair value level of unconsolidated seeded investment products is determined using the underlying inputs used in the calculation of the NAV of each product. Level 2 Fair Value Measurements Our Level 2 fair value measurements consist mostly of consolidated seeded investment products and our long-term debt. The fair value of consolidated seeded investment products is determined by the underlying securities of the product. The fair value of our long-term debt is determined using broker quotes and recent trading activity, which are considered Level 2 inputs. Level 3 Fair Value Measurements Our assets and liabilities measured at Level 3 are primarily private equity investments, contingent deferred consideration and deferred compensation liabilities that are held against investments in our fund products, where the significant valuation inputs are unobservable. Private equity investments are valued using a combination of the enterprise value/EBITDA multiple method and the discounted cash flow method. Significant unobservable inputs include discount rates, EBITDA multiple and price-earnings ratio, taking into account management’s experience and knowledge of market conditions of the specific industries. Details of inputs used to calculate the fair value of contingent deferred consideration can be found in Note 10 – Fair Value Measurements. Nonrecurring Fair Value Measurements Nonrecurring Level 3 fair value measurements include goodwill and intangible assets. We measure the fair value of goodwill and intangible assets on initial recognition using discounted cash flow analysis that requires assumptions regarding projected future earnings and discount rates. Because of the significance of the unobservable inputs in the fair value measurements of these assets and liabilities, such measurements are classified as Level 3. See the Goodwill and Intangible Assets, Net accounting policy set forth within this note for further information. Income Taxes We provide for current tax expense according to the tax laws in each jurisdiction in which we operate, using tax rates and laws that have been enacted by the balance sheet date. Deferred income tax assets and liabilities are recorded for temporary differences between the financial statement and income tax basis of assets and liabilities as measured by the enacted income tax rates that may be in effect when these differences reverse. The effect of changes in tax rates on our deferred tax assets and liabilities is recognized as income tax within net income in the period that includes the enactment date. Significant management judgment is required in developing our provision for income taxes, including the valuation allowances that might be required against deferred tax assets and the evaluation of unrecognized tax benefits resulting from uncertain tax positions taken or expected to be taken in a tax return. We periodically assess the recoverability of our deferred tax assets and the need for valuation allowances on these assets. We make these assessments based on the weight of available evidence regarding possible sources of future taxable income and estimates relating to the future performance of the business that results in taxable income. In evaluating uncertain tax positions, we consider the probability that the tax benefit can be sustained on examination by a taxing authority on the basis of its technical merits (“the recognition threshold”). For tax positions meeting this threshold, the amount recognized in the financial statements is the benefit expected to be realized upon settlement with the taxing authority on the basis of a cumulative-probability assessment of the possible outcomes. For tax positions not meeting the recognition threshold, no financial statement benefit is recognized. We recognize the accrual of interest and penalties on uncertain tax positions as a component of the income tax provision. Revenue Recognition Revenue is measured and recognized based on the five-step process outlined in U.S. GAAP. Revenue is determined based on the transaction price negotiated with the customer, net of rebates. Management fees, performance fees, shareowner servicing fees and other revenue are derived from providing professional services to manage investment products. Management fees are earned over time as services are provided and are generally based on a percentage of the market value of AUM. These fees are calculated as a percentage of either the daily, month-end or quarter-end average asset balance in accordance with contractual agreements. Performance fees are specified in certain fund and client contracts and are based on investment performance either on an absolute basis or compared to an established index over a specified period of time. Performance fees are generated on certain management contracts when performance hurdles or other specified criteria are achieved. Performance fees for all fund ranges and separate accounts are recognized when it is probable that a significant reversal of revenue recognized will not occur in future periods. There are no performance fee contracts where revenue can be clawed back. There are no cumulative revenues recognized that would be reversed if all of the existing investments became worthless. Management fees are primarily received monthly or quarterly, while performance fees are usually received monthly, quarterly or annually, although the frequency of receipt varies between agreements. Management and performance fee revenue earned but not yet received is recognized within fees and other receivables on our Consolidated Balance Sheets. Shareowner servicing fees are earned for services rendered related to transfer agent and administrative activities performed for investment products. These services are transferred over time and are generally based on a percentage of the market value of AUM. Other revenue includes distribution and servicing fees earned from U.S. mutual funds associated with mutual fund transfer agent, accounting, shareholder servicing and participant recordkeeping activities. These services are transferred over time and are generally based on a percentage of the market value of AUM. U.S. Mutual Fund Performance Fees The investment management fee paid by each U.S. mutual fund subject to a performance fee is the base management fee plus or minus a performance fee adjustment as determined by the relative investment performance of the fund compared to a specified benchmark index. Under the performance-based fee structure, the investment advisory fee paid by each fund consists of two components: (i) a base fee calculated by applying the contractual fixed rate of the advisory fee to the fund’s average daily net assets during the previous month, plus or minus (ii) a performance fee adjustment calculated by applying a variable rate of up to 0.15% to the fund’s average daily net assets during the performance measurement period. The performance measurement period begins as a trailing period ranging from 12 to 18 months , and each subsequent month is added to each successive performance measurement period until a 36-month period is achieved. At that point, the measurement period becomes a rolling 36-month period. The addition of performance fees to all funds without such fees is subject to the approval of both a majority of the shareholders of such funds and the funds’ independent board of trustees. Principal Versus Agent We utilize third-party intermediaries to fulfill certain performance obligations in our revenue agreements. Generally, we are deemed to be the principal in these arrangements because we control the investment management and other related services before they are transferred to customers. Such control is evidenced by our primary responsibility to customers, the ability to negotiate the third-party contract price and select and direct third-party service providers, or a combination of these factors. Therefore, distribution and service fee revenues and the related third-party distribution and service expenses are reported on a gross basis. Operating Expenses Operating expenses are accrued and recognized as incurred. Stock-Based Compensation We grant stock-based awards to our employees, all of which are classified as equity settled stock-based payments. Equity settled stock-based payments are measured at the fair value of the shares at the grant date. The awards are expensed, with a corresponding increase in reserves, on a graded basis over the vesting period. Forfeitures are recognized as they occur. The grant date fair value for stock options is determined using the Black-Scholes option pricing model, and the grant date fair value of restricted stock is determined from the market price on the date of grant. The Black-Scholes model requires management to determine certain variables; the assumptions used in the Black-Scholes option pricing model include dividend yield, expected volatility, risk-free interest rate and expected life. The dividend yield and expected volatility are determined using historical Group data. The risk-free interest rate for options granted is based on the three year UK treasury coupon at the time of the grant. The expected life of the stock options is the same as the service conditions applicable to all Group awards. We generally use the Monte Carlo model to determine the fair value of performance-based awards. The assumptions used in the Monte Carlo model include dividend yield, share price volatility and discount rate. We had no stock-based compensation costs included in retained earnings during the years ended December 31, 2019 and 2018, and $9.9 million of costs included in retained earnings during the years ended December 31, 2017. We had no proceeds from stock-based compensation plans included in retained earnings for the years ended December 31, 2019, 2018 and 2017. Prior to our Extraordinary General Meeting (“EGM”) on April 26, 2017, our articles of association did not allow us to recognize these items in additional paid-in-capital. A change in our articles of association was approved at the EGM and from April 26, 2017, all costs in relation to stock-based compensation will be recognized in additional paid-in-capital. There was no accumulated balance in relation to stock-based compensation plans within retained earnings as of December 31, 2019 and 2018. Commissions Commissions on management fees are accounted for on an accrual basis and are recognized in the accounting period in which the associated management fee is earned. Earnings Per Share Basic earnings per share attributable to our shareholders is calculated by dividing net income (adjusted for the allocation of earnings to participating re |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 12 Months Ended |
Dec. 31, 2019 | |
Recent Accounting Pronouncements | |
Recent Accounting Pronouncements | N ote 3 — R ecent A ccounting P ronouncements Recent Accounting Pronouncements Adopted Leases In February 2016, the Financial Accounting Standards Board (“FASB”) issued a new standard on accounting for leases. The new standard represents a significant change to lease accounting and introduces a lessee model that brings leases onto the balance sheet. The standard also aligns certain underlying principles of the new lessor model with those in the FASB’s new revenue recognition standard. Furthermore, the new standard addresses other concerns related to the prior leases model. The standard became effective January 1, 2019. We adopted the new standard effective January 1, 2019, using the modified retrospective approach. Comparative prior periods were not adjusted upon adoption as we utilized the practical expedients available under the guidance. Specifically, we did not (i) reassess existing contracts for embedded leases, (ii) reassess existing lease agreements for finance or operating classification, or (iii) reassess existing lease agreements in consideration of initial direct costs. Upon adoption, we recognized $129.8 million in ROU assets related to its leased property and equipment. Corresponding lease liabilities of $146.4 million were also recognized. Our property leases represent the vast majority of our ROU assets and lease liabilities, with office spaces in Denver and London representing a significant portion of our leased property. Refer to further disclosure in Note 8 – Leases. Hedge Accounting In August 2017, the FASB issued an updated standard that amended hedge accounting. The standard expanded the strategies eligible for hedge accounting, changed how companies assess hedge effectiveness and required new disclosures and presentation. We adopted the standard effective January 1, 2019. The adoption did not have a material impact on our results of operations or financial position. Recent Accounting Pronouncements Not Yet Adopted Retirement Benefit Plans In August 2018, the FASB issued an accounting standards update (“ASU”) that modifies the disclosure requirements for employers that sponsor defined benefit pension plans. The ASU removes, adds and clarifies a number of disclosure requirements related to sponsored benefit plans. The standard is effective January 1, 2021, for calendar year-end companies, and early adoption is permitted. We are evaluating the effect of adopting this new accounting standard. Implementation Costs — Cloud Computing Arrangements In August 2018, the FASB issued an ASU that aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement with the requirements for implementation costs incurred to develop or obtain internal-use software. The ASU is effective January 1, 2020, for calendar year-end companies and for the interim periods within those years. Early adoption is permitted. The ASU allows either a retrospective or prospective approach to all implementation costs incurred after adoption. We are evaluating the effect of adopting this new accounting standard and anticipate adopting the standard on a prospective basis. We generally expect increased capitalized costs as our previous policy dictated that implementation costs incurred in a hosting arrangement be expensed as incurred. |
Acquisitions and Dispositions
Acquisitions and Dispositions | 12 Months Ended |
Dec. 31, 2019 | |
Acquisitions and Dispositions | |
Acquisitions and Dispositions | N ote 4 — Acquisitions and Dispositions Merger with JCG On May 30, 2017 (the “Closing Date”), pursuant to the Agreement and Plan of Merger dated as of October 3, 2016 (the “Merger Agreement”), by and among JCG, a Delaware corporation, Henderson, a company incorporated in Jersey, and Horizon Orbit Corp., a Delaware corporation and a direct and wholly owned subsidiary of Henderson (“Merger Sub”), Merger Sub merged with and into JCG, with JCG surviving such merger as a direct and wholly owned subsidiary of Henderson. Upon closing of the Merger, Henderson became the parent holding company for the combined group and was renamed Janus Henderson Group plc. The fair value of consideration transferred to JCG common stockholders was $2,630.2 million, representing 87.2 million shares of JHG transferred at a share price of $30.75 each as of the Closing Date, adjusted for a post-combination stock-based compensation charge for unvested shares in relation to JCG share plans. Pro Forma Results of Operations The following table presents summarized unaudited supplemental pro forma operating results as if the Merger had occurred at the beginning of January 1, 2016 (in millions): Year ended December 31, 2017 Revenue $ 2,182.6 Net income attributable to JHG $ 704.6 JCG Results of Operations Revenue (inclusive of revenue from certain mandates transferred to JCG from Henderson after the Merger) and net income of JCG from the Closing Date through the end of December 31, 2017, included in JHG’s Consolidated Statements of Comprehensive Income are presented in the following table (in millions): Closing Date — December 31, 2017 Revenue $ 752.9 Net income attributable to JCG $ 354.0 Sale of Geneva In the fourth quarter 2019, we entered into an agreement to sell our Milwaukee-based U.S. equities subsidiary Geneva. The sale has not yet closed as of February 26, 2020. Contingent Consideration Acquisitions prior to the Merger included contingent consideration. Refer to Note 10 – Fair Value Measurements for a detailed discussion of the terms of the contingent consideration. |
Consolidation
Consolidation | 12 Months Ended |
Dec. 31, 2019 | |
Consolidation | |
Consolidation | Note 5 — Consolidation Variable Interest Entities Consolidated Variable Interest Entities Our consolidated VIEs as of December 31, 2019 and 2018, include certain consolidated seeded investment products in which we have an investment and act as the investment manager. The assets of these VIEs are not available to us or our creditors. We may not, under any circumstances, access cash and cash equivalents held by consolidated VIEs to use in our operating activities or otherwise. In addition, the investors in these VIEs have no recourse to the credit of JHG. Unconsolidated Variable Interest Entities At December 31, 2019 and 2018, the carrying value of investment securities included on our Consolidated Balance Sheets pertaining to unconsolidated VIEs was $9.9 million and $3.1 million, respectively. Our total exposure to unconsolidated VIEs represents the value of its economic ownership interest in the investment securities. Voting Rights Entities Consolidated Voting Rights Entities The following table presents the balances related to consolidated VREs that were recorded on JHG’s Consolidated Balance Sheets, including our net interest in these products (in millions): December 31, December 31, 2019 2018 Investment securities $ 29.9 $ 13.9 Cash and cash equivalents 1.5 1.4 Other current assets 0.2 0.1 Accounts payable and accrued liabilities (0.7) (0.1) Total 30.9 15.3 Redeemable noncontrolling interests in consolidated VREs (6.3) (6.0) JHG's net interest in consolidated VREs $ 24.6 $ 9.3 Our total exposure to consolidated VREs represents the value of our economic ownership interest in these seeded investment products. Unconsolidated Voting Rights Entities At December 31, 2019 and 2018, the carrying value of investment securities included on our Consolidated Balance Sheets pertaining to unconsolidated VREs were $21.5 million and $50.7 million, respectively. Our total exposure to unconsolidated VREs represents the value of our economic ownership interest in the investment securities. |
Investment Securities
Investment Securities | 12 Months Ended |
Dec. 31, 2019 | |
Investment Securities | |
Investment Securities | N ote 6 — I nvestment S ecurities Our investment securities as of December 31, 2019 and 2018, are summarized as follows (in millions): December 31, December 31, 2019 2018 Seeded investment products: Consolidated VIEs $ 924.8 $ 282.7 Consolidated VREs 29.9 13.9 Unconsolidated VIEs and VREs 31.4 53.8 Separate accounts 60.8 71.6 Pooled investment funds 0.1 25.5 Total seeded investment products 1,047.0 447.5 Investments related to deferred compensation plans 125.9 120.3 Other investments 5.4 6.7 Total investment securities $ 1,178.3 $ 574.5 Trading Securities Net unrealized gains (losses) on investment securities held by us as of December 31, 2019, 2018 and 2017, are summarized as follows (in millions): Year ended December 31, 2019 2018 2017 Unrealized gains (losses) on investment securities held at period end $ (19.2) $ (40.6) $ 25.2 Derivative Instruments We maintain an economic hedge program that uses derivative instruments to mitigate against market volatility of certain seeded investments by using index and commodity futures (“futures”), index swaps, total return swaps (“TRSs”) and credit default swaps. Foreign currency exposures associated with our seeded investment products are also hedged by using foreign currency forward contracts. We also have a net investment hedge related to foreign currency translation on hedged seed investments denominated in currencies other than our functional currency. We were a party to the following derivative instruments as of December 31, 2019 and 2018 (in millions): Notional Value December 31, 2019 December 31, 2018 Futures $ 222.9 $ 147.1 Credit default swaps 143.0 133.2 Total return swaps 46.3 77.2 Foreign currency forward contracts 327.8 131.8 The derivative instruments are not designated as hedges for accounting purposes, with the exception of certain foreign currency forward contracts used for net investment hedging. Changes in fair value of the futures, index swaps, TRSs and credit default swaps are recognized in investment gains (losses), net in our Consolidated Statements of Comprehensive Income. Changes in the fair value of the foreign currency forward contracts designated as hedges for accounting purposes are recognized in other comprehensive income (loss), net of tax on our Consolidated Statements of Comprehensive Income. Derivative assets and liabilities are generally recognized on a gross basis and included in other current assets or accounts payable and accrued liabilities on the Consolidated Balance sheets. As of December 31, 2019 derivative assets and liabilities were $0.7 million and $8.7 million, respectively. We recognized the following foreign currency translation gains (losses) on hedged seed investments denominated in currencies other than our functional currency and gains (losses) associated with foreign currency forward contracts under net investment hedge accounting for the years ended December 31, 2019, 2018 and 2017 (in millions): Year ended December 31, 2019 2018 2017 Foreign currency translation $ (1.1) $ (6.8) $ (3.2) Foreign currency forward contracts 1.1 6.8 3.2 Total $ — $ — $ — In addition to using derivative instruments to mitigate against market volatility of certain seeded investments, we also occasionally engage in short sales of securities. As of December 31, 2019, the fair value of securities sold but not yet purchased was $26.5 million. The cash received from the short sale and the obligation to repurchase the shares are classified in other current assets and accounts payable and accrued liabilities on our Consolidated Balance Sheets, respectively. Fair value adjustments are recognized in investment gains (losses), net on our Consolidated Statements of Comprehensive Income. Derivative Instruments in Consolidated Seeded Investment Products Certain of our consolidated seeded investment products utilize derivative instruments to contribute to the achievement of defined investment objectives. These derivative instruments are classified within other current assets or accounts payable and accrued liabilities on our Consolidated Balance Sheets. Gains and losses on these derivative instruments are classified within investment gains (losses), net in our Consolidated Statements of Comprehensive Income. Our consolidated seeded investment products were party to the following derivative instruments as of December 31, 2019 and 2018 (in millions): Notional Value December 31, 2019 December 31, 2018 Futures $ 88.3 $ 267.8 Contracts for differences 15.5 8.7 Credit default swaps 0.1 6.2 Total return swaps 0.1 23.7 Interest rate swaps 19.4 61.5 Options 1.0 9.6 Swaptions — 8.3 Foreign currency forward contracts 167.5 154.9 one As sellers in credit default swap contracts, the consolidated seeded investment products would be required to pay the notional value of a referenced debt obligation to the counterparty in the event of a default on the debt obligation by the issuer. The notional value represents the estimated maximum potential undiscounted amount of future payments required upon the occurrence of a credit default event. As of December 31, 2019 and 2018, the notional values of the agreements totaled $2.2 million and $3.9 million, respectively. The credit default swap contracts include recourse provisions that allow for recovery of a certain percentage of amounts paid upon the occurrence of a credit default event. As of December 31, 2019 and 2018, the fair value of the credit default swap contracts selling protection was nil and $0.1 million, respectively. Investment Gains (Losses), Net Investment gains (losses), net on our Consolidated Statements of Comprehensive Income included the following for the years ended December 31, 2019, 2018 and 2017 (in millions): Year ended December 31, 2019 2018 2017 Seeded investment products and derivatives, net $ 20.7 $ (42.6) $ 4.0 Gain on sale of Volantis — — 10.2 Other 13.5 1.7 3.8 Investment gains (losses), net $ 34.2 $ (40.9) $ 18.0 Cash Flows Cash flows related to our investment securities for the years ended December 31, 2019, 2018 and 2017, are summarized as follows (in millions): Year ended December 31, 2019 2018 2017 Sales, Sales, Sales, Purchases settlements Purchases settlements Purchases settlements and and and and and and settlements maturities settlements maturities settlements maturities Investment securities $ (903.4) $ 582.6 $ (626.3) $ 697.1 $ (827.5) $ 976.4 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets | |
Goodwill and Intangible Assets | N ote 7 — G oodwill and I ntangible A ssets The following tables present movements in our intangible assets and goodwill during the years ended December 31, 2019 and 2018 (in millions): December 31, Foreign December 31, 2018 Amortization Impairment translation Disposal 2019 Indefinite-lived intangible assets: Investment management agreements $ 2,495.5 $ — $ (18.0) $ 12.8 $ — $ 2,490.3 Trademarks 380.8 — — — — 380.8 Definite-lived intangible assets: — Client relationships 363.3 — — 1.4 — 364.7 Accumulated amortization (116.3) (29.3) — (1.6) — (147.2) Net intangible assets $ 3,123.3 $ (29.3) $ (18.0) $ 12.6 $ — $ 3,088.6 Goodwill $ 1,478.0 $ — $ — $ 26.3 $ — $ 1,504.3 December 31, Foreign December 31, 2017 Amortization Impairment translation Disposal 2018 Indefinite-lived intangible assets: Investment management agreements $ 2,543.9 $ — $ (7.2) $ (41.2) $ — $ 2,495.5 Trademarks 381.2 — — (0.4) — 380.8 Definite-lived intangible assets: Client relationships 369.4 — — (6.1) — 363.3 Accumulated amortization (89.7) (29.5) — 2.9 — (116.3) Net intangible assets $ 3,204.8 $ (29.5) $ (7.2) $ (44.8) $ — $ 3,123.3 Goodwill $ 1,533.9 $ — $ — $ (46.4) $ (9.5) $ 1,478.0 Indefinite-lived intangible assets represent certain investment management contracts where we expect both the renewal of the contracts and the cash flows generated by them to continue indefinitely. Trademarks primarily relate to JCG and were acquired as a result of the Merger. Definite-lived intangible assets represent client relationships, which are amortized over their estimated lives using the straight-line method. The initial estimated weighted-average life of the client relationships is approximately 13 years. Foreign currency translation movements in the table primarily relate to the translation of the intangible assets and goodwill balances denominated in non-USD currencies to our functional and presentational currency of USD using the closing foreign currency exchange rate at the end of each reporting period. Transaction with BNP Paribas On March 31, 2018, we completed a transaction transferring JHG’s back-office (including fund administration and fund accounting); middle-office (including portfolio accounting, securities operations and trading operations); and custody functions in the U.S. to BNP Paribas. As part of the transaction, more than 100 of our employees, based in Denver, Colorado, transitioned to BNP Paribas, and BNP Paribas became the fund services provider for our U.S.-regulated mutual funds. Gross consideration of $40.0 million was received for the transaction, which resulted in the recognition of a $22.3 million gain in other non-operating income (expenses), net on the Consolidated Statements of Comprehensive Income. We also allocated $9.5 million of goodwill to the transaction, which resulted in a $9.5 million goodwill reduction, disclosed in the disposal column in the table above. Future Amortization Expected future amortization expense related to definite-lived intangible assets is summarized below (in millions): Future amortization Amount 2020 $ 29.4 2021 26.5 2022 18.0 2023 17.8 2024 16.4 Thereafter 109.4 Total $ 217.5 Impairment Testing We perform our annual impairment assessment of goodwill and indefinite-lived intangible assets on October 1 of each year. For our 2019 assessment, we elected to perform step one of the goodwill impairment assessment comparing the estimated fair value of the reporting unit to its carrying value. We opted to use a market value approach with a control premium to estimate the enterprise value of our sole reporting unit. The results of the assessment revealed the estimated fair value of the reporting unit was $0.3 billion greater than the carrying value. Certain indefinite-lived intangible assets comprised of investment management agreements were tested for impairment in the second quarter 2019 due to lower than expected growth. A discounted cash flow model was used to determine the estimated fair value. Some of the inputs used in the discounted cash flow model required significant management judgment; this includes the discount rate, terminal growth rate and forecasted financial results. The results of the valuation indicated an estimated value of $132.0 million which was $18.0 million below the $150.0 million carrying value of intangible asset. As such, we recorded an $18.0 million impairment in depreciation and amortization expense in the Consolidated Statements of Comprehensive Income. The carrying value of the intangible asset as of December 31, 2019 (post-impairment) was $132.0 million. We also assessed our indefinite-lived intangible assets as part of our annual impairment assessment. We used a qualitative approach to determine the likelihood of impairment, with AUM being the focus of the assessment. After reviewing the results of the qualitative assessment, certain intangible assets comprised of investment management agreements with a carrying value of $167.6 million as of September 30, 2019 required further review to determine if they were impaired. We prepared a discounted cash flow model to arrive at the estimated fair value of the intangible asset, which was above the carrying value of the asset. As discussed above, some of the inputs in the discounted cash flow model require significant management judgment. For the remaining indefinite-lived intangible assets, we concluded it is more likely than not that the fair values of our intangible assets exceed their carrying values; no impairment was recorded. Our definite-lived intangible assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. There were no definite-lived intangible asset impairments identified during the year ended December 31, 2019. For the year ended December 31, 2018, we identified and recorded a $7.2 million impairment associated with our Gartmore investment management agreements, which was recognized within depreciation and amortization in the Consolidated Statement of Comprehensive Income. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2019 | |
Leases | |
Leases | Note 8 — Leases Our leases include operating and finance leases for property and equipment. Property leases include office space in the UK, Europe, the U.S. and the Asia-Pacific region. Equipment leases include copiers and server equipment located throughout our office space. Our leases have remaining lease terms of one year to 10 years. Certain leases include options to extend or early terminate the leases, however, we currently do not intend to exercise these options, and they are not reflected in our lease assets and liabilities. The impact of operating and financing leases on our financial statements is summarized below. Balance Sheet Operating and financing lease assets and liabilities on our Consolidated Balance Sheets as of December 31, 2019, consisted of the following (in millions): Operating lease right-of-use assets: December 31, 2019 Other non-current assets $ 132.6 Operating lease liabilities: Accounts payable and accrued liabilities $ 24.9 Other non-current liabilities 129.4 Total operating lease liabilities $ 154.3 Finance lease right-of-use assets: Property and equipment, cost $ 13.0 Accumulated depreciation (12.2) Property and equipment, net $ 0.8 Finance lease liabilities Accounts payable and accrued liabilities $ 0.8 Other non-current liabilities 0.1 Total finance lease liabilities $ 0.9 Statement of Comprehensive Income The components of lease expense on our Consolidated Statements of Comprehensive Income for the year ended December 31, 2019, are summarized below (in millions): Year ended December 31, 2019 Operating lease cost (1) $ 33.7 Finance lease cost: Amortization of right-of-use asset (2) $ 1.1 Interest on lease liabilities (3) — Total finance lease cost $ 1.1 (1) Included in general, administrative and occupancy on our Consolidated Statements of Comprehensive Income. (2) Included in depreciation and amortization on our Consolidated Statements of Comprehensive Income. (3) Included in interest expense on our Consolidated Statements of Comprehensive Income. We sublease certain office buildings in the UK and received $7.3 million from the tenants during the year ended December 31, 2019. We recognized a $4.7 million impairment of a subleased ROU operating asset in the UK during the year ended December 31, 2019, as collection of rents under the sublease are uncertain. Also, we recognized a $0.7 million impairment of a U.S. operating lease during the year ended December 31, 2019, due to early termination of the lease. Cash Flow Statement Cash payments for operating and finance leases included in our Consolidated Statements of Cash Flows for the year ended December 31, 2019, consisted of the following (in millions): Year ended December 31, 2019 Operating cash flows from operating leases $ 28.9 Financing cash flows from finance leases $ 1.1 Non-cash lease transactions during the year ended December 31, 2019, included a $19.8 million ROU asset and corresponding lease liability for a UK property lease commenced in March 2019. Supplemental Information As of December 31, 2019, we have an additional operating lease for office space in the U.S. that has not yet commenced. The lease commenced in January 2020, with a lease term of 11 years. The future rent obligations associated with the lease are $8.4 million. The weighted-average remaining lease term, weighted-average discount rate and future lease obligations are summarized below. Weighted-average remaining lease term (in months): December 31, 2019 Operating leases 80 Finance leases 15 Weighted-average discount rate (1) : December 31, 2019 Operating leases 4.6% Finance leases 2.8% (1) Discounted using incremental borrowing rates determined for each lease as of the date of adoption, including consideration for specific interest rate environments. Future lease obligations (in millions) Operating leases Finance leases 2020 $ 31.1 $ 0.7 2021 29.8 0.1 2022 25.5 0.1 2023 23.6 — 2024 22.4 — Thereafter 48.8 — Total lease payments 181.2 0.9 Less interest 26.9 — Total $ 154.3 $ 0.9 |
Equity Method Investments
Equity Method Investments | 12 Months Ended |
Dec. 31, 2019 | |
Equity Method Investments | |
Equity Method Investments | Note 9 — Equity Method Investments Equity method investments of $8.8 million and $7.8 million were recognized on our Consolidated Balance Sheets within other non-current assets as of December 31, 2019 and 2018, respectively. We hold interests in the following equity method investments, including joint ventures managed through shareholder agreements with third-party investors, accounted for under the equity method: Country of incorporation 2019 2018 and principal Functional percentage percentage place of operation currency owned owned Long Tail Alpha USA USD 20 % 20 % The share of net gain (loss) from equity method investments recognized within investment gains (losses), net on our Consolidated Statements of Comprehensive Income was $1.5 million gain and $2.0 million gain during the years ended December 31, 2019 and 2018, respectively. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Measurements | |
Fair Value Measurements | N ote 10 — F air V alue M easurements The following table presents assets and liabilities in our consolidated financial statements or disclosed in the notes to our consolidated financial statements at fair value on a recurring basis as of December 31, 2019 (in millions): Fair value measurements using: Quoted prices in active markets for identical assets Significant other Significant and liabilities observable inputs unobservable inputs (Level 1) (Level 2) (Level 3) Total Assets: Cash equivalents $ 198.4 $ — $ — $ 198.4 Investment securities: Consolidated VIEs 573.9 341.0 9.9 924.8 Other investment securities 197.0 56.5 — 253.5 Total investment securities 770.9 397.5 9.9 1,178.3 Seed hedge derivatives — 0.7 — 0.7 Volantis contingent consideration — — 2.9 2.9 Total assets $ 969.3 $ 398.2 $ 12.8 $ 1,380.3 Liabilities: Derivatives in consolidated seeded investment products $ — $ 0.9 $ — $ 0.9 Securities sold, not yet purchased 26.5 — — 26.5 Seed hedge derivatives — 8.7 — 8.7 Long-term debt (1) — 330.0 — 330.0 Deferred bonuses — — 76.6 76.6 Contingent consideration — — 21.2 21.2 Total liabilities $ 26.5 $ 339.6 $ 97.8 $ 463.9 (1) Carried at amortized cost on our Consolidated Balance Sheets and disclosed at fair value. The following table presents assets and liabilities in our consolidated financial statements or disclosed in the notes to the consolidated financial statements at fair value on a recurring basis as of December 31, 2018 (in millions): Fair value measurements using: Quoted prices in active markets for identical assets Significant other Significant and liabilities observable inputs unobservable inputs (Level 1) (Level 2) (Level 3) Total Assets: Cash equivalents $ 381.8 $ — $ — $ 381.8 Investment securities: Consolidated VIEs 103.8 159.7 19.2 282.7 Other investment securities 194.5 97.3 — 291.8 Total investment securities 298.3 257.0 19.2 574.5 Seed hedge derivatives — 3.2 — 3.2 Derivatives in consolidated seeded investment products — 0.9 — 0.9 Contingent consideration — — 3.9 3.9 Total assets $ 680.1 $ 261.1 $ 23.1 $ 964.3 Liabilities: Derivatives in consolidated seeded investment products $ — $ 2.1 $ — $ 2.1 Financial liabilities in consolidated seeded investment products 0.4 — — 0.4 Seed hedge derivatives — 1.1 — 1.1 Long-term debt (1) — 301.4 — 301.4 Deferred bonuses — — 68.5 68.5 Contingent consideration — — 61.3 61.3 Total liabilities $ 0.4 $ 304.6 $ 129.8 $ 434.8 (1) Carried at amortized cost on our Consolidated Balance Sheets and disclosed at fair value. Level 1 Fair Value Measurements Our Level 1 fair value measurements consist mostly of seeded investment products, investments in advised mutual funds, cash equivalents and investments related to deferred compensation plans with quoted market prices in active markets. The fair value level of consolidated seeded investment products is determined by the underlying securities of the product. The fair value level of unconsolidated seeded investment products is determined by the underlying inputs used in the calculation of the NAV and the trading activity of each product. Level 2 Fair Value Measurements Our Level 2 fair value measurements consist mostly of consolidated seeded investment products, derivative instruments and our long-term debt. The fair value of consolidated seeded investment products is determined by the underlying securities of the product. The fair value of our long-term debt is determined using broker quotes and recent trading activity, which are considered Level 2 inputs. Level 3 Fair Value Measurements Investment Products As of December 31, 2019 and 2018, certain securities within consolidated VIEs were valued using significant unobservable inputs, resulting in Level 3 classification. Valuation techniques and significant unobservable inputs used in the valuation of our material Level 3 assets included within consolidated VIEs as of December 31, 2019 and 2018, were as follows (in millions): Significant Fair Valuation unobservable As of December 31, 2019 value technique inputs Inputs Investment securities of consolidated VIEs $ 9.9 Discounted Discount rate 15% cash flow EBITDA multiple 5.92 Price-earnings ratio 11.09 Significant Fair Valuation unobservable Range As of December 31, 2018 value technique inputs (weighted-average) Investment securities of consolidated VIEs $ 19.2 Discounted Discount rate 15% cash flow EBITDA multiple 18.5 Price-earnings ratio 28.4 Contingent Consideration The maximum amount payable and fair value of Geneva and Kapstream contingent consideration is summarized below (in millions): As of December 31, 2019 Geneva Kapstream Maximum amount payable $ 52.2 $ 14.4 Fair value included in: Accounts payable and accrued liabilities $ — $ 14.3 Other non-current liabilities 6.9 — Total fair value $ 6.9 $ 14.3 As of December 31, 2018 Geneva Kapstream Fair value included in: Accounts payable and accrued liabilities $ — $ 13.8 Other non-current liabilities 25.3 12.3 Total fair value $ 25.3 $ 26.1 Acquisition of Geneva The consideration payable on the acquisition of Geneva in 2014 included two contingent tranches payable over six years . The fair value of the contingent consideration is estimated at each reporting date by forecasting revenue, as defined by the sale and purchase agreement, over the contingency period and by determining whether targets will be met. Significant unobservable inputs used in the valuation are limited to forecasted revenues, which factor in expected growth in AUM based on performance and industry trends. A fair value adjustment due to a revised forecast resulted in a $20.0 million decrease to the liability during the year ended December 31, 2019. The adjustment was recorded in other non-operating income, net on our Consolidated Statements of Comprehensive Income. The remaining change in the liability is due to the unwind of the discount. In the fourth quarter 2019, we entered into an agreement to sell our Milwaukee-based U.S. equities subsidiary Geneva. The sale has not yet closed as of February 26, 2020. Acquisition of Kapstream The purchase of Kapstream was a step acquisition and the purchase of the second step (49%) had contingent consideration of up to $43.0 million. Payment of the contingent consideration is subject to all Kapstream products and certain products advised by us, reaching defined revenue targets on the first, second and third anniversaries of January 31, 2017. The contingent consideration is payable in three equal installments on the anniversary dates and is indexed to the performance of the premier share class of the Kapstream Absolute Return Income Fund. If Kapstream achieves the defined revenue targets, the holders receive the value of the contingent consideration adjusted for gains or losses attributable to the mutual fund to which the contingent consideration is indexed, subject to tax withholding. On January 31, 2018, 2019 and 2020, the first, second, and third anniversary of the acquisition, Kapstream reached defined revenue targets, and we paid $15.3 million in February 2018, $14.1 million in February 2019 and $13.8 million in February 2020. The February 2020 payment represented the final payment. The fair value of the Kapstream contingent consideration is calculated at each reporting date by forecasting certain Kapstream AUM or defined revenue over the contingency period and determining whether the forecasted amounts meet the defined targets. Significant unobservable inputs used in the valuation are limited to forecasted Kapstream AUM and performance against defined revenue targets. No fair value adjustment was necessary during the year ended December 31, 2019. Acquisition of Perennial The acquisition of Perennial Fixed Interest Partners Ltd and Perennial Growth Management Pty Ltd (together “Perennial”) included the earn-out payable in 2019. The earn-out had employee service conditions, was based on net management fee revenue and was accrued over the service period as compensation expense. The earn-out criteria were achieved in September 2019 and the Group paid $12.1 million in October 2019. Disposal of Volantis On April 1, 2017, we completed the sale of Volantis alternative team assets. Consideration for the sale was a 10% share of the management and performance fees generated by Volantis for a period of three years. The fair value of the Volantis contingent consideration is estimated at each reporting date by forecasting revenues over the contingency period of three years. Significant unobservable inputs used in the valuation are limited to forecasted revenues, which factor in expected growth in AUM based on performance and industry trends. Increases in forecasted revenue increase the fair value of the consideration, while decreases in forecasted revenue decrease the fair value. The forecasted share of revenues is then discounted back to the valuation date using a discount rate. As of December 31, 2019 and 2018, the fair value of the Volantis contingent consideration was $2.9 million and $3.9 million, respectively. Deferred Bonuses Deferred bonuses represent liabilities to employees over the vesting period that will be settled by investments in our products. The significant unobservable inputs used to value the liabilities are investment designations and vesting periods. Changes in Fair Value Changes in fair value of our Level 3 assets for the years ended December 31, 2019 and 2018 were as follows (in millions): Year ended December 31, 2019 2018 Beginning of period fair value $ 23.1 $ 46.5 Disposals — (7.6) Settlements (2.3) (5.9) Movement recognized in net income (8.2) (9.5) Movements recognized in other comprehensive income 0.2 (0.4) End of period fair value $ 12.8 $ 23.1 Changes in fair value of our individual Level 3 liabilities for the years ended December 31, 2019 and 2018,were as follows (in millions): Year ended December 31, 2019 2018 Contingent Deferred Contingent Deferred Dai-ichi consideration bonuses consideration bonuses option Beginning of period fair value $ 61.3 $ 68.5 $ 76.6 $ 64.7 $ 26.1 Fair value adjustments (20.0) 7.5 11.2 (0.4) (26.8) Vesting of deferred bonuses — (52.3) — (44.8) — Amortization of deferred bonuses — 49.6 — 53.7 — Unrealized gains (losses) 6.7 — — — — Distributions (26.6) — (22.8) — — Foreign currency translation (0.2) 3.3 (3.7) (4.7) 0.7 End of period fair value $ 21.2 $ 76.6 $ 61.3 $ 68.5 $ — Nonrecurring Fair Value Measurements Nonrecurring Level 3 fair value measurements include goodwill and intangible assets. We measure the fair value of goodwill and intangible assets on initial recognition using discounted cash flow analysis that requires assumptions regarding projected future earnings and discount rates. Because of the significance of the unobservable inputs in the fair value measurements of these assets, such measurements are classified as Level 3. |
Debt
Debt | 12 Months Ended |
Dec. 31, 2019 | |
Debt | |
Debt | N ote 11 — D ebt Our debt as of December 31, 2019 and 2018, consisted of the following (in millions): December 31, 2019 December 31, 2018 Carrying Fair Carrying Fair value value value value 4.875% Senior Notes due 2025 $ 316.2 $ 330.0 $ 319.1 $ 301.4 4.875% Senior Notes Due 2025 The 2025 Senior Notes have a principal value of $300.0 million as of December 31, 2019, pay interest at 4.875% semiannually on February 1 and August 1 of each year, and mature on August 1, 2025. The Senior Notes include unamortized debt premium, net at December 31, 2019, of $16.2 million, which will be amortized over the remaining life of the notes. The unamortized debt premium is recorded as a liability within long-term debt on our Consolidated Balance Sheets. We fully and unconditionally guarantee the obligations of JCG in relation to the Senior Notes. Credit Facility At December 31, 2019, we had a $200 million, unsecured, revolving credit facility (“Credit Facility”). JHG and our subsidiaries can use the Credit Facility for general corporate purposes. The rate of interest for each interest period is the aggregate of the applicable margin, which is based on our long-term credit rating and the London Interbank Offered Rate (“LIBOR”); the Euro Interbank Offered Rate (“EURIBOR”) in relation to any loan in euro (“EUR”); or in relation to any loan in Australian dollar (“AUD”), the benchmark rate for that currency. We are required to pay a quarterly commitment fee on any unused portion of the Credit Facility, which is also based on our long-term credit rating. Under the Credit Facility, the financing leverage ratio cannot exceed 3.00x EBITDA. At December 31, 2019, we were in compliance with all covenants contained in, and there were no borrowings under, the Credit Facility. The maturity date of the Credit Facility is February 16, 2024. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Taxes | |
Income Taxes | N ote 12 — I ncome T axes The components of our provision for income taxes for the years ended December 31, 2019, 2018 and 2017, are as follows (in millions): Year ended December 31, 2019 2018 2017 Current: UK $ 23.6 $ 48.8 $ 51.5 U.S. including state and local 110.7 116.7 83.1 International 8.2 7.2 10.0 Total current income taxes 142.5 172.7 144.6 Deferred: UK (0.4) (3.1) 0.3 U.S. including state and local (2.2) (6.6) (354.4) International (2.1) (0.8) (1.5) Total deferred income taxes (benefits) (4.7) (10.5) (355.6) Total income tax expense (benefit) $ 137.8 $ 162.2 $ (211.0) The components of our total income before taxes for the years ended December 31, 2019, 2018 and 2017, are as follows (in millions): Year ended December 31, 2019 2018 2017 UK $ 80.1 $ 178.3 $ 229.0 U.S. 445.3 467.4 190.5 International 58.1 16.1 27.9 Total income before taxes $ 583.5 $ 661.8 $ 447.4 We are a tax resident in the UK and are subject to the tax laws and regulations of that country. The following is a reconciliation between the UK statutory corporation tax rate and the effective tax rate on our income from operations. Year ended December 31, 2019 2018 2017 UK statutory corporation tax rate 19.0 % 19.0 % 19.3 % Effect of foreign tax rates 4.4 3.9 7.4 Equity-based compensation 1.1 0.3 0.2 Finalization of positions with HMRC (1) — — 0.3 Tax adjustments 0.2 0.3 0.7 Non-deductible costs associated with the Merger — — 1.2 Impact of changes in statutory tax rates on deferred taxes — 0.1 (77.4) Taxes applicable to prior years (0.5) (1.2) (0.4) Other, net — 1.4 1.7 Effective income tax rate, controlling interest 24.2 % 23.8 % (47.0) % Net income attributable to noncontrolling interests (0.6) 0.7 (0.1) Total effective income tax rate 23.6 % 24.5 % (47.1) % (1) Her Majesty’s Revenue and Customs (“HMRC”), tax authority of the UK. We operate in several taxing jurisdictions around the world, each with its own statutory tax rate and set of tax laws and regulations. As a result, our future blended average statutory tax rate will be influenced by any changes to such laws and regulations and the mix of profits and losses of our subsidiaries. Tax Legislation Any legislative changes and new or proposed Treasury regulations may result in additional income tax impacts, which could be material in the period any such changes are enacted. Deferred Taxes The significant components of our deferred tax assets and liabilities as of December 31, 2019 and 2018, are as follows (in millions): December 31, 2019 2018 Deferred tax assets: Compensation and staff benefits $ 63.0 $ 60.8 Loss carryforwards (1) 59.9 55.9 Accrued liabilities 2.8 3.1 Debt premium 4.6 5.4 Lease liabilities 27.1 — Other 16.9 11.8 Gross deferred tax assets 174.3 137.0 Valuation allowance (56.1) (55.6) Deferred tax assets, net of valuation allowance $ 118.2 $ 81.4 Deferred tax liabilities: Retirement benefits $ (24.9) $ (23.9) Goodwill and acquired intangible assets (790.0) (783.9) Lease right-of-use assets (25.8) — Other (4.8) (3.5) Gross deferred tax liabilities (845.5) (811.3) Total deferred tax (liabilities) (2) $ (727.3) $ (729.9) (1) The majority of this loss carryforward relates to the UK capital loss of $298.0 million, before tax effects, which may be carried forward without time limitation. There is a full valuation allowance against UK capital losses. (2) The change in the net deferred tax liabilities does not equal the deferred tax expense due to the FX adjustment on deferred tax liabilities booked through equity. Deferred tax assets and liabilities that relate to the same jurisdiction are recorded net on our Consolidated Balance Sheets as non-current balances and as of December 31, 2019 and 2018, are as follows (in millions): December 31, 2019 2018 Deferred tax assets, net (included in other non-current assets) $ 1.8 $ — Deferred tax liabilities, net (729.1) (729.9) Total deferred tax (liabilities) $ (727.3) $ (729.9) A valuation allowance has been established against the deferred tax assets related to our tax loss carryforward where a history of losses in the respective tax jurisdiction makes it unlikely that the deferred tax asset will be realized or where it is unlikely that we would generate sufficient taxable income of the appropriate character to realize the full benefit of the deferred tax asset. The valuation allowance for deferred tax assets increased by $0.5 million in 2019. The increase is primarily attributable to foreign currency translation on capital losses. The foreign net operating losses also slightly increased during the current year. As a multinational company, we operate in various locations outside the U.S. and generate earnings from our non-U.S. subsidiaries. Prior to enactment of the Tax Act, we indefinitely reinvested the undistributed earnings of all of our non-U.S. subsidiaries, except for income previously taxed in the U.S. or subject to regulatory or legal repatriation restrictions or requirements. Consistent with prior year’s assertion, we intend to assert indefinite reinvestment on distribution exceeding the tax basis and undistributed earnings for Janus UK Corp. and Kapstream. Unrecognized Tax Benefits We operate in several tax jurisdictions and a number of years may elapse before an uncertain tax position, for which we have unrecognized tax benefits, is finally resolved. A reconciliation of the beginning and ending liability for the years ended December 31, 2019, 2018 and 2017, is as follows (in millions): Year ended December 31, 2019 2018 2017 Beginning balance $ 12.4 $ 10.2 $ 2.5 Balance acquired from the Merger — — 5.0 Additions for tax positions of current year — 2.2 3.4 Additions/(reduction) for tax positions of prior years 3.5 1.4 0.8 Reduction due to settlement with taxing authorities — (0.5) (0.9) Reduction due to statute expirations (1.9) (0.7) (0.9) Foreign currency translation 0.1 (0.2) 0.3 Ending balance $ 14.1 $ 12.4 $ 10.2 If recognized, the balance would favorably affect our effective tax rate in future periods. We recognize interest and penalties on uncertain tax positions as a component of the income tax provision. At December 31, 2019, 2018 and 2017, the total accrued interest balance relating to uncertain tax positions was $1.7 million, $1.5 million and $1.5 million, respectively. Potential penalties at December 31, 2019, 2018 and 2017, were insignificant and have not been accrued. We are subject to U.S. federal income tax, state and local income tax, UK income tax and income tax in several other jurisdictions, all of which can be examined by the relevant taxing authorities. For our major tax jurisdictions, the tax years that remain open to examination by the taxing authorities at December 31, 2019, are 2016 and onward for U.S. federal tax, and a few states have open years from 2013. The tax years from 2015 and onwards remain open for the UK under the normal four-year time limit. It is reasonably possible that the total amounts of unrecognized tax benefits will change within the next 12 months due to completion of tax authorities’ exams or the expiration of statutes of limitations. Management estimates that the existing liability for uncertain tax positions could decrease by approximately $0.2 million within the next 12 months, ignoring changes due to foreign currency translation. |
Other Financial Statement Capti
Other Financial Statement Captions | 12 Months Ended |
Dec. 31, 2019 | |
Other Financial Statement Captions | |
Other Financial Statement Captions | N ote 13 — O ther Financial Statement C aptions Other current assets on our Consolidated Balance Sheets at December 31, 2019 and 2018, are composed of the following (in millions): December 31, 2019 2018 Prepaid expenses $ 27.4 $ 22.6 Current corporation tax 9.5 4.3 Derivatives (including short sale assets) 26.0 3.2 Other current assets 53.1 39.3 Total other current assets $ 116.0 $ 69.4 Other non-current assets on our Consolidated Balance Sheets of $149.3 million as of December 31, 2019, primarily relate to operating leases arising from the implementation of ASC 842 and equity-method investments. The $15.5 million balance as of December 31, 2018, primarily relates to equity-method investments. Accounts payable and accrued liabilities on our Consolidated Balance Sheets at December 31, 2019 and 2018, comprise the following (in millions): December 31, 2019 2018 Accrued distribution commissions $ 50.8 $ 42.2 Accrued rebates 28.5 30.2 Other accrued liabilities 52.5 84.7 Total other accrued liabilities $ 131.8 $ 157.1 Current corporation tax (including interest) 12.6 28.0 Leases 25.7 1.1 Contingent consideration 14.3 13.8 Derivatives (including short sale liabilities) 35.3 1.1 Other current liabilities 26.3 32.1 Total accounts payable and accrued liabilities $ 246.0 $ 233.2 Other non-current liabilities on our Consolidated Balance Sheets at December 31, 2019 and 2018, comprise the following (in millions): December 31, 2019 2018 Non-current tax liabilities (including interest) $ 14.9 $ 10.6 Leases 129.5 — Other creditors 7.5 10.3 Contingent consideration 6.9 47.5 Other non-current accrued liabilities — 10.8 Total other non-current liabilities $ 158.8 $ 79.2 Other creditors included within other non-current liabilities primarily comprise the non-current portion of lease obligations as of December 31, 2019 and 2018. As a result of historic acquisitions, we are a party to two material operating leases in respect of 8 Lancelot Place, London, and Rex House, Queen Street, London. The leases run for a further period of five years and eight years, respectively. At the cease use date of these properties, a loss contingency, net of expected sub lease rental income, was recognized in respect of these properties as an accrued liability on our Consolidated Balance Sheets at the net present value of the net expected future cash outflows. |
Noncontrolling Interests
Noncontrolling Interests | 12 Months Ended |
Dec. 31, 2019 | |
Noncontrolling Interests | |
Noncontrolling Interests | N ote 14 — N oncontrolling I nterests Redeemable Noncontrolling Interests Redeemable noncontrolling interests as of December 31, 2019 and 2018, consisted of the following (in millions): December 31, 2019 2018 Consolidated seeded investment products $ 662.8 $ 121.6 Intech: Appreciation rights 11.8 10.9 Founding member ownership interests 3.3 3.6 Total redeemable noncontrolling interests $ 677.9 $ 136.1 Consolidated Seeded Investment Products Noncontrolling interests in consolidated seeded investment products are classified as redeemable noncontrolling interests when there is an obligation to repurchase units at the investor’s request. Redeemable noncontrolling interests in consolidated seed investment products may fluctuate from period to period and are impacted by changes in our relative ownership, changes in the amount of third-party investment in seeded products and volatility in the market value of the seeded products’ underlying securities. Third-party redemption of investments is redeemed from the respective product’s net assets and cannot be redeemed from the assets of other seeded products or from our other assets. The following table presents the movement in redeemable noncontrolling interests in consolidated seeded investment products for the years ended December 31, 2019, 2018 and 2017 (in millions): Year ended December 31, 2019 2018 2017 Opening balance $ 121.6 $ 174.9 $ 158.0 Balance acquired from the Merger — — 23.2 Changes in market value 18.9 (15.5) (9.8) Changes in ownership 509.7 (36.3) 3.7 Foreign currency translation 12.6 (1.5) (0.2) Closing balance $ 662.8 $ 121.6 $ 174.9 Intech Intech ownership interests held by a founding member had an estimated fair value of $3.3 million as of December 31, 2019, representing an approximate 1.1% ownership of Intech. This founding member is entitled to retain his remaining Intech interests for the remainder of his life and has the option to require us to purchase his ownership interests of Intech at fair value. Intech appreciation rights are amortized using a graded vesting method over the respective vesting period. The appreciation rights are exercisable upon termination of employment from Intech to the extent vested. Upon exercise, the appreciation rights are settled in Intech equity. Refer to Note 15 – Long Term Incentive Compensation for a description of Intech appreciation rights. Nonredeemable Noncontrolling Interests Nonredeemable noncontrolling interests as of December 31, 2019 and 2018, are as follows (in millions): December 31, 2019 2018 Nonredeemable noncontrolling interests in: Seed capital investments $ 6.7 $ 8.3 Intech 13.0 13.2 Total nonredeemable noncontrolling interests $ 19.7 $ 21.5 |
Long-Term Incentive Compensatio
Long-Term Incentive Compensation | 12 Months Ended |
Dec. 31, 2019 | |
Long-Term Incentive Compensation | |
Long-Term Incentive Compensation | N ote 15 — L ong - T erm I ncentive C ompensation We operate the following stock-based compensation plans: ● ● ● ● ● ● ● ● ● ● ● ● Further details on the material plans in operation during 2019 are discussed below. Deferred Equity Plan (“DEP”) Employees who receive cash-based incentive awards over a preset threshold, have an element deferred. The deferred awards are deferred into our common stock or into our managed funds. The DEP trustee purchases JHG common stock and units or shares in JHG-managed funds and holds them in trust. Awards are deferred for up to three years and vest in three equal The expense of deferred short-term incentive awards is recognized in net income over the period of deferral on a graded basis, the fair value of which is determined by prevailing share price or unit price at grant date. Restricted Share Plan (“RSP”) The RSP allows employees to receive shares of our common stock for nil consideration at a future point, usually after three years . RSP is recognized in net income on a graded basis. The awards are typically granted for staff recruitment and retention purposes; all awards have employment conditions and larger awards can be subject to performance hurdles. Our Compensation Committee approves all awards to Code Staff (employees who perform a significant influence function, senior management and individuals whose professional activities could have a material impact on our risk profile), and any awards over £500,000. The fair value of the shares granted is calculated using the NYSE average high/low trading prices on grant date. Buy As You Earn Share Plan (“BAYE”) The BAYE is an HMRC-approved plan. Eligible employees purchase shares of our common stock by investing monthly, up to £150 (annual limit £1,800), which is deducted from their gross salary. For each share purchased (“partnership share”), The non-UK version of the BAYE operates on a similar basis to that of the UK, but matched partnership shares are not subject to forfeiture. Sharesave Plan (“SAYE”) The SAYE is an HMRC-approved plan. UK employees may participate in more than one SAYE scheme but only up to a maximum of £500 per month in aggregate. Employees who participate in the SAYE contribute a monthly amount from their net salary to a savings account. The SAYE vesting period is three years for UK employees. At the end of the three-year vesting period, employees in the SAYE can exercise their share options using the funds in their savings account to subscribe for shares at a pre-set price. The pre-set price was £14.76 per share, £20.16 per share and £18.40 per share for 2019, 2018 and 2017, respectively, and represents a 20% discount to the average share price five The U.S. Employee Share Purchase Plan (“ESPP”) operates on the same principles as the UK SAYE, but has a two-year savings period and a lower discount at 15%. In 2019, 2018 and 2017, ESPP was not offered to U.S. employees. The pre-set option price of prior year awards was $31.20 for 2016 ESPP. Employees may participate in more than one plan, but only up to a plan maximum of $312.50 per month across all plans. Company Share Option Plan (“CSOP”) CSOP is an HMRC-approved share option plan with the maximum value of unvested options at any time limited to £30,000 for UK employees. No such restrictions apply for overseas employees. Employees can buy shares of our common stock after a three-year vesting period at an option price fixed at the start of the scheme. There are no JHG performance conditions attached to the options, only employment conditions that must be satisfied. The exercise period is two years , while U.S. employees have three months to exercise. Executive directors are not eligible to participate in the CSOP, but they may hold awards made prior to their executive appointment. The CSOP plans are valued using the Black-Scholes option pricing model and recognized in net income on a straight-line basis. There were no CSOP awards made for the years 2019 and 2018. The option price for the 2017 CSOP was £22.80, and this became available to exercise for U.S. employees in April 2019 as the U.S. CSOP is a two-year plan. The 2016 CSOP became available to exercise for UK employees in April 2019; the option price was £26.10. Executive Shared Ownership Plan (“ExSOP”) The ExSOP is an employee share ownership plan and is aimed at encouraging employee share ownership at the middle management level. Executive directors do not participate in the ExSOP. Certain employees are invited to acquire jointly, with an employee benefit trust, the beneficial interest in a number of JHG shares under the terms of a joint ownership agreement (“JOA”). Under a JOA, the employee will benefit from any growth in value in excess of a hurdle price fixed at the time of the award subject to employment conditions being satisfied on the vesting date. The ExSOP scheme is valued using the Black Scholes option pricing model and is recognized in net income on a straight-line basis. There were no ExSOP awards made for the years ended December 31, 2019 and 2018. The market price per share at grant for the 2017 ExSOP was £22.62, with a hurdle price per share set at £24.90. The shares have a three-year vesting period with a subsequent two-year exercise period. The 2016 ExSOP became exercisable for employees in April 2019 with a market price at grant of £26.14 and a hurdle price of £28.45. Restricted Stock Awards (“RSA”) RSAs are generally issued as part of annual variable compensation and for recruitment and retention purposes in accordance with the Amended and Restated 2010 LTI Plan, the JCG 2005 Long-Term Incentive Stock Plan and the 2012 EIA Plan. Awards generally vest over a three Price-Vesting Units JCG granted 137,178 price-vesting units to its CEO on December 31, 2014, valued at $2.2 million. At the Closing Date, the price-vesting units were converted to JHG price-vesting units with a value of $2.3 million and were measured based on operating profit margin performance and converted into a time-based award vesting on December 31, 2017. On December 31, 2017, 75,634 price-vesting units vested. JCG granted 138,901 price-vesting units to its CEO on December 31, 2015, valued at $1.9 million. At the Closing Date, the price-vesting units were converted to 65,548 JHG price-vesting units with a value of $2.0 million. Vesting of these price-vesting units was subject to our three-year Total Shareholder Return (“TSR”) performance relative to a peer group over a three-year period following the grant date. On December 31, 2018, 38,236 price-vesting units vested. JCG granted 134,666 price-vesting units to its CEO on December 31, 2016, valued at $1.8 million. At the Closing Date, the price-vesting units were converted to 63,549 JHG price-vesting units with a value of $2.0 million. The performance criteria remained in place post-Merger through the life of the price-vesting units. On December 31, 2019, 23,831 price-vesting units vested. We granted a total of 108,184 price-vesting units to our co-CEOs on February 28, 2018, valued at $3.7 million. These price-vesting units may or may not vest in whole or in part three years after the date of grant, depending on our three-year TSR performance relative to a peer group during the vesting period. We granted 83,863 price vesting units to our CEO on February 28, 2019, valued at $2.0 million. These price vesting units may or may not vest in whole or in part, three years after the date of grant, depending on our three-year TSR performance relative to a peer group during the vesting period. Mutual Fund Share Awards (“MFSA”) MFSAs are generally issued as part of annual variable compensation and for recruitment and retention purposes. At December 31, 2019, the cost basis of unvested mutual fund share awards totaled $79.3 million. The awards are indexed to certain mutual funds managed by us. Upon vesting, participants receive the value of the award adjusted for gains or losses attributable to the mutual funds to which the award was indexed, subject to tax withholding. The awards are time-based awards that generally vest three Long-Term Incentive Awards In October 2014, Intech granted long-term incentive awards to retain and incentivize employees. The awards consisted of appreciation rights, profits interests and phantom interests, and are designed to give recipients an equity-like stake in Intech. Upon the Closing Date of the Merger, the appreciation rights had fair value of $13.3 million, which is being amortized using a graded basis over the 10-year vesting schedule. The appreciation rights are exercisable upon termination of employment from Intech and to the extent vested. Upon exercise, the appreciation rights are settled in Intech equity. The profits interests and phantom interest awards entitle recipients to 9.0% of Intech’s pre-incentive profits. Additional appreciation rights were granted in February 2015 and March 2016. Upon the closing date of the Merger, the 2015 and 2016 appreciation rights had fair value of $0.9 million and $1.8 million, respectively, which is being amortized using a graded basis over the remaining vesting schedule. The appreciation rights are exercisable upon termination of employment from Intech and to the extent vested. Upon exercise, the appreciation rights are settled in Intech equity. The fair values of the appreciation rights were estimated using the Black-Scholes option pricing model with the following assumptions: Assumptions October 2014 February 2015 March 2016 grant grant grant Dividend yield 1.98 % 2.56 % 2.89 % Expected volatility 34 % 30 % 28 % Risk-free interest rate 2.53 % 1.81 % 1.93 % Expected life (in years) 12 6 6 Grant date fair value (in millions) $ 23.2 $ 2.0 $ 2.6 Merger date fair value (in millions) $ 13.3 $ 0.9 $ 1.8 The dividend yield and expected volatility were determined using historical data from publicly traded peers. The risk-free interest rate for the 2014 grant is based on the 10-year U.S. Treasury note at the time of the grant while the risk-free interest rates for the 2015 and 2016 grants are based on the average of the five-year and seven-year U.S. Treasury notes at the time of the grant. The expected life of the appreciation rights was estimated based upon the assumption that recipients terminate upon vesting and exercise a certain percentage of their rights each year over the following four years. Intech profits interests and phantom interests entitle holders to periodic distributions of a portion of Intech operating income. Distributions are made during employment and, for profits interests, post-employment for up to 10 years. Phantom interests are entitled to a one-time distribution at termination of employment. Compensation expense for post-employment distributions is based upon the present value of expected future distributions and will be recognized pro rata over the 10-year vesting schedule for profits interests and five years for phantom interests. The present value of these payments was determined using a 2% discount rate, which represents the interest rate on a 20-year U.S. Treasury note. As of December 31, 2019, the total undiscounted estimated post-employment payments for profits interests and phantom interests was $27.7 million (the majority will not be paid until 10 to 20 years after the grant date). The estimated post-employment payments will be evaluated and adjusted quarterly, as necessary, with changes recorded in results of operations. As of December 31, 2019, the carrying value of the liability associated with the Intech profits interests and phantom interests was $13.2 million and is included in Accrued compensation, benefits and staff costs on our Consolidated Balance Sheets. Long - Term Incentive Plan (“LTIP”) LTIP awards provide selected employees restricted shares or nil cost options that have employment and performance conditions. Employees who have been awarded such options have five years to exercise following the three-year vesting period for 2013 LTIP, and following the three and four-year vesting periods for 2014 LTIP. For 2014 LTIP, if our TSR is between the 50th and 75th percentiles, the amount vesting will increase on a linear basis. Our Compensation Committee must also be satisfied that our TSR reflects the underlying performance of the company. The performance hurdle was 95% relative to our TSR and 5% on risk and sustainability metrics. Employees must also satisfy employment conditions at each anniversary date for the shares to vest. Two -thirds one -third The 2015 and 2016 LTIP award vesting and release of the award are subject to performance against the following performance conditions measured (as appropriate) over, or at the end of, the relevant three 2015 and 2016 awards criteria (pre- Merger) Weighting Market conditions FTSE 350 25 % ASX 100 25 % Non-market Net fund flows condition 15 % Investment performance condition 15 % Operating margin condition 15 % People strategy condition 10 % Following the completion of the Merger with JCG, our Compensation Committee reviewed the performance metrics under the existing LTIP plans and proposed changes to ensure that the metrics remain relevant and appropriate for the objectives and goals of the combined company. 2014 LTIP vesting conditions remain unchanged and the existing performance metrics were measured as of May 30, 2017, to determine the appropriate level of vesting. The vested portion of the 2015 and 2016 LTIP awards remain subject to the original metrics (measured at the Merger completion date) while the new criteria were applied to the unvested portion: 2015 and 2016 awards criteria (post-Merger) Weighting Market conditions Relative TSR 50 % Non-market Relative investment performance 25 % Relative net income before tax growth 25 % In respect of the first tranche of the award, an additional holding period of two years will apply commencing on the relevant vesting date, during which time the participant may not sell, pledge, charge, assign, dispose of or otherwise transfer ownership of the underlying share pertaining to the award other than to meet mandatory liabilities to tax and/or Social Security contributions. In respect of the second tranche of the award, an additional holding period of one year will apply commencing on the relevant vesting date with similar conditions. The performance period for the first tranche of 2014 LTIP was completed on December 31, 2016, and 3% of awards vested in April 2017. The performance period for the second tranche of 2014 LTIP was completed on December 31, 2017, and 3% of awards vested in April 2018. The Monte Carlo model was used to value the options of the 2015 and 2016 plans. The performance period for the first tranche of 2015 LTIP was completed on December 31, 2017. 25% of the pre-Merger awards and 74.6% of the post-Merger awards vested in April 2018. The performance period for the second tranche of 2015 LTIP was completed on December 31, 2018. 25% of the pre-Merger awards and 35.5% of the post-Merger awards vested in April 2019. The performance period for the first tranche of 2016 LTIP was completed on December 31, 2018. 25% of the pre-Merger awards and 35.5% of the post-Merger awards vested in April 2019. The performance period for the second tranche of 2016 LTIP was completed on December 31, 2019. Vesting of the second tranche will be determined in March 2020 and the awards will vest in April 2020. Compensation Expense The components of our long-term incentive compensation expense for the years ended December 31, 2019, 2018 and 2017, are summarized as follows (in millions): Year ended December 31, 2019 2018 2017 DEP $ 19.1 $ 18.7 $ 17.6 LTIP 1.3 2.6 6.4 RSP 8.3 10.1 3.4 BAYE 2.1 3.0 3.2 ExSOP 0.3 0.8 1.5 CSOP 0.3 0.6 1.1 SAYE 0.1 0.9 0.8 RSA (including PVUs) 42.2 44.9 32.8 ESOP — — — Stock-based payments expense 73.7 81.6 66.8 DEP Funds - liability settled 57.5 54.9 41.4 MFSA - liability settled 46.2 24.3 20.7 Profits interests and other (3.9) 18.4 12.3 Social Security costs 10.8 9.4 10.3 Total charge to the Consolidated Statements of Comprehensive Income $ 184.3 $ 188.6 $ 151.5 At December 31, 2019, unrecognized and unearned compensation, based on expected vesting outcomes as of December 31, 2019, on the 2016 LTIP, and the weighted-average number of years over which the compensation cost will be recognized are summarized as follows (in millions): Weighted- Unrecognized average compensation years DEP $ 13.5 1.4 LTIP 0.1 0.2 RSP 6.8 1.6 BAYE 0.4 0.5 ExSOP 0.1 0.2 CSOP 0.1 0.2 SAYE 0.7 2.0 RSA 37.9 1.7 Stock-based payments expense 59.6 1.6 DEP Funds - liability settled 28.8 1.3 MFSA - liability settled 30.1 2.1 Profits interests and other 14.4 4.5 Social Security costs 19.1 0.9 Total remaining charge to the Consolidated Statements of Comprehensive Income $ 152.0 1.8 We generally grant annual long-term incentive awards in March and April in relation to annual awards but also throughout the year due to seasonality of performance fee bonuses. Stock Options Stock options were granted to employees in 2019, 2018 and 2017. The fair value of stock options granted were estimated on the date of each grant using the Black-Scholes option pricing model and a Monte Carlo model, with the following assumptions: Black-Scholes Option Pricing Model Year ended December 31, 2019 2018 2017 SAYE SAYE CSOP U.S. CSOP ExSOP SAYE Fair value of options granted £ 2.15 £ 4.99 33.43 p 32.81 p 27.78 p 75.28 p Assumptions: Dividend yield 6.92 % 3.85 % 4.64 % 4.64 % 4.64 % 3.99 % Expected volatility 30.17 % 32.20 % 32.41 % 35.19 % 32.41 % 32.13 % Risk-free interest rate 0.55 % 0.70 % 0.27 % 0.16 % 0.27 % 0.19 % Expected life (years) 3 3 3 2 3 3 Monte Carlo Model – LTIP 2015 Year ended December 31, 2019 % Allocation of award Tranche 1 Tranche 2 Fair Values: Relative TSR 50 % 118.96 p 124.11 p Relative investment performance 25 % 209.76 p 206.59 p Relative net income before tax growth 25 % 209.76 p 206.59 p Assumptions: Date of grant May 1, 2015 May 1, 2015 Start of performance period January 1, 2015 January 1, 2015 End of performance period December 31, 2017 December 31, 2018 Vesting date May 1, 2018 May 1, 2019 Date of modification ("DoM") May 30, 2017 May 30, 2017 Share price at DoM 233.7 p 233.7 p Risk free discount rate 0.1 % pa 0.1 % pa Dividend yield 4.5 % pa 4.5 % pa Share price volatility in GBP 30 % pa 30 % pa Holding period adjustment 9.0 % 6.2 % Percentage based on pre-modification performance conditions 80 % 60 % Monte Carlo Model – LTIP 2016 Year Ended December 31, 2019 % Allocation of award Tranche 1 Tranche 2 Fair values: Relative TSR 50 % 120.98 p 123.64 p Relative investment performance 25 % 200.42 p 197.39 p Relative net income before tax growth 25 % 200.42 p 197.39 p Assumptions: Date of grant May 24, 2016 May 24, 2016 Start of performance period January 1, 2016 January 1, 2016 End of performance period December 31, 2018 December 31, 2019 Vesting date March 24, 2019 March 24, 2020 Date of modification ("DoM") May 30, 2017 May 30, 2017 Share price at DoM 233.7 p 233.7 p Risk free discount rate 0.1 % pa 0.1 % pa Dividend yield 4.5 % pa 4.5 % pa Share price volatility in GBP 30 % pa 30 % pa Holding period adjustment 9.0 % 6.2 % Expected volatility was determined using an average of historical volatility. Expected life was determined using the vesting periods of each grant. The risk-free interest rate for periods within the contractual life of the options is based on the UK Treasury three-year coupon rate and two-year coupon rate, respectively, at grant date. The table below summarizes our outstanding options, exercisable options and options vested or expected to vest for the years ended December 31, 2019, 2018 and 2017: 2019 2018 2017 Weighted- Weighted- Weighted- average average average Shares price Shares price Shares price Outstanding at January 1 3,139,762 $ 27.91 4,319,706 $ 22.55 45,560,242 $ 1.97 Share consolidation — $ — — $ — (41,004,619) $ 19.82 Acquired from Merger — $ — — $ — 92,949 $ 18.76 Granted 244,336 $ 18.84 84,273 $ 26.88 2,042,321 $ 13.66 Exercised (325,134) $ 5.43 (212,562) $ 12.31 (404,735) $ 20.32 Forfeited (1,185,037) $ 28.30 (1,051,655) $ 11.81 (1,966,452) $ 7.41 Outstanding at December 31 1,873,927 $ 28.41 3,139,762 $ 27.91 4,319,706 $ 22.55 Exercisable (1) 91,099 $ — 707,848 $ 33.75 5,014,642 $ 34.67 Vested or expected to vest 962,064 $ 32.97 1,157,663 $ 1.51 2,999,811 $ 15.57 Included in the above table are our nil cost LTIP options, which constitute the majority of forfeitures. (1) The number of exercisable options represents instruments for which all vesting criteria have been satisfied and whose exercise price was below the closing price of our common stock as of the end of the period. The following table summarizes the intrinsic value of exercised, outstanding and exercisable options at December 31, 2019, 2018 and 2017 (in millions): December 31, 2019 2018 2017 Exercised $ 0.4 $ 0.1 $ 2.8 Outstanding $ 1.0 $ 0.2 $ 15.9 Exercisable $ 0.3 $ 0.2 $ 3.9 Deferred Equity Plan The table below summarizes DEP unvested stock awards for the years ended December 31, 2019, 2018 and 2017: 2019 2018 2017 Weighted- Weighted- Weighted- average average average Shares price Shares price Shares price Outstanding at January 1 1,738,776 $ 33.41 1,442,091 $ 32.36 16,466,630 $ 3.17 Share consolidation — $ — — $ — (14,825,509) $ 31.64 Adjustment — $ — — $ — 1,275 $ 15.43 Granted 1,403,472 $ 23.63 1,129,504 $ 33.55 919,967 $ 31.40 Vested (828,953) $ 31.44 (731,596) $ 33.80 (873,810) $ 31.33 Forfeited (193,345) $ 28.42 (101,223) $ 33.07 (246,462) $ 28.06 Unvested at December 31 2,119,950 $ 26.98 1,738,776 $ 33.41 1,442,091 $ 32.36 Restricted Stock Awards The table below summarizes unvested restricted stock awards for the years ended December 31, 2019, 2018 and 2017: 2019 2018 2017 Weighted- Weighted- Weighted- average average average Shares price Shares price Shares price Outstanding at January 1 3,378,150 $ 32.35 3,537,221 $ 30.81 4,068,619 $ 30.72 Granted 1,395,824 $ 24.37 1,107,382 $ 35.57 73,982 $ 35.08 Vested (1,238,185) $ 31.92 (1,197,671) $ 30.76 (444,884) $ 30.73 Forfeited (138,819) $ 30.72 (68,782) $ 32.49 (160,496) $ 30.72 Unvested at December 31 3,396,970 $ 29.30 3,378,150 $ 32.35 3,537,221 $ 30.81 |
Retirement Benefit Plans
Retirement Benefit Plans | 12 Months Ended |
Dec. 31, 2019 | |
Retirement Benefit Plans | |
Retirement Benefit Plans | N ote 16 — Retirement Benefit Plans Defined Contribution Plans We operate two separate defined contribution retirement benefit plans: a 401(k) plan for U.S. employees and a separate plan for international employees. Substantially all of our U.S. full-time employees are eligible to participate in our 401(k) plan. During the year ended December 31, 2019, we matched 5.0% of employee-eligible compensation in our 401(k) plan. Expenses related to our 401(k) plan are included in employee compensation and benefits on our Consolidated Statements of Comprehensive Income and were $7.9 million and $5.8 million during the years ended December 31, 2019 and 2018, respectively. The assets of the plan are held in trustee-administered funds separately from our assets. Substantially all of our non-U.S. full-time employees are eligible to participate in our defined contribution plans. The total amounts charged to our Consolidated Statements of Comprehensive Income for the years ended December 31, 2019, 2018 and 2017, in respect of our non-U.S. defined contribution plan was $10.4 million, $7.5 million and $11.8 million, respectively, which represents contributions paid or payable to this plan by us. Defined Benefit Plans The main defined benefit pension plan sponsored by us is the defined benefit section of the Janus Henderson Group UK Pension Scheme (“JHGPS” or the “Plan”), previously the Henderson Group Pension Scheme, which closed to new members on November 15, 1999. The JHGPS is funded by contributions to a separately administered fund. Benefits in the defined benefit section of the JHGPS are based on service and final salary. The plan is approved by HMRC for tax purposes and is operated separately from the Group and managed by an independent trustee board. The trustee is responsible for payment of the benefits and management of the JHGPS assets. We also have a contractual obligation to provide certain members of the JHGPS with additional defined benefits on an unfunded basis. The JHGPS is subject to UK regulations, which require us and the trustee to agree to a funding strategy and contribution schedule for the scheme. Our latest triennial valuation of the JHGPS resulted in a surplus on a technical provisions basis of £12.0 million ($15.9 million). Plan assets and benefit obligations The Plan assets and defined benefit obligations of the JHGPS and the unapproved pension plan were valued as of December 31, 2019 and 2018. Our plan assets, benefit obligations and funded status as of the December 31 measurement date were as follows (in millions): December 31, 2019 2018 Change in plan assets: Fair value of plan assets as of January 1 $ 849.5 $ 941.8 Return on plan assets 100.1 (11.1) Employer contributions 2.0 12.5 Benefits paid (14.8) (14.7) Settlements (25.4) (24.0) Foreign currency translation 34.5 (55.0) Fair value of plan assets as of December 31 945.9 849.5 Change in benefit obligation: Benefit obligation as of January 1 (613.3) (719.1) Service cost (0.8) (1.2) Interest cost (17.4) (17.3) Settlements 25.4 24.0 Plan amendments — (3.9) Benefits paid 14.8 14.7 Actuarial gain (loss) (86.8) 47.6 Foreign currency translation (25.1) 41.9 Benefit obligation as of December 31 (703.2) (613.3) Funded status as of year-end 242.7 236.2 Tax at source (33.1) (33.4) Net retirement benefit asset recognized in the Consolidated Balance Sheets $ 209.6 $ 202.8 Amounts recognized on our Consolidated Balance Sheet, net of tax at source as of December 31, 2019 and 2018, consist of the following (in millions): December 31, 2019 2018 Retirement benefit assets recognized in the Consolidated Balance Sheets: Janus Henderson Group UK Pension Scheme $ 214.0 $ 206.5 Retirement benefit obligations recognized in the Consolidated Balance Sheets: Janus Henderson Group unapproved pension scheme (4.4) (3.7) Net retirement benefit asset recognized in the Consolidated Balance Sheets $ 209.6 $ 202.8 We used the following key assumptions in determining the defined benefit obligation as of December 31, 2019 and 2018: December 31, 2019 2018 Discount rate 2.1 % 2.9 % Inflation - salaries 2.5 % 2.5 % Inflation - Retail Price Index ("RPI") 3.0 % 3.1 % Inflation - Consumer Price Index ("CPI") 1.9 % 2.0 % Pension increases (RPI capped at 5% per annum ("p.a.")) 2.9 % 3.0 % Pension increases (RPI capped at 2.5% p.a.) 2.0 % 2.1 % Life expectancy of male aged 60 at accounting date 28.3 28.2 Life expectancy of male aged 60 in 15 years time 29.3 29.2 The discount rate applied to the plan obligations is based on AA-rated corporate bond yields with similar maturities. Plan assets The fair values of the JHGPS plan assets as of December 31, 2019 and 2018, by major asset class, are as follows (in millions): December 31, 2019 2018 Cash and cash equivalents $ 3.7 $ 6.4 Money market instruments 78.1 21.6 Forward foreign exchange contracts — 0.3 Bulk annuity policy 395.8 — Fixed income investments 261.4 623.2 Equity investments 206.9 198.0 Total assets at fair value $ 945.9 $ 849.5 As of December 31, 2019, $250.9 million of JHGPS assets were held in JHG-managed funds. On September 5, 2019, JHGPS and Scottish Widows Limited (“SWL”) entered into a pension buy-in agreement (the “agreement”). The agreement provides JHGPS a monthly contractual payment stream from SWL to satisfy pension obligations payable to approximately one The remaining assets of the JHGPS plan are allocated to a growth portfolio and to fixed income assets. The majority of the growth portfolio is invested in pooled diversified funds, with the objective of achieving a level of growth greater than the fixed income portfolio. The fixed income portfolio is managed on a segregated basis, with the primary objective of meeting the cash flows as they mature. The strategic allocation as of December 31, 2019, was broadly 30% fixed income investments, 40% bulk annuity policy and 30% growth portfolio. The following table presents JHGPS plan assets at fair value on a recurring basis as of December 31, 2019 (in millions): Fair value measurements using: Quoted prices in active markets for and liabilities Significant other Significant identical assets observable inputs unobservable inputs (Level 1) (Level 2) (Level 3) Total Cash and cash equivalents $ 3.7 $ — $ — $ 3.7 Money market instruments — 78.1 — 78.1 Bulk annuity contract — — 395.8 395.8 Fixed income investments 261.4 — — 261.4 Equity investments 206.9 — — 206.9 Total $ 472.0 $ 78.1 $ 395.8 $ 945.9 The following table presents JHGPS plan assets at fair value on a recurring basis as of December 31, 2018 (in millions): Fair value measurements using: Quoted prices in active markets for and liabilities Significant other Significant identical assets observable inputs unobservable inputs (Level 1) (Level 2) (Level 3) Total Cash and cash equivalents $ 6.4 $ — $ — $ 6.4 Money market instruments — 21.6 — 21.6 Forward foreign exchange contracts 0.3 — — 0.3 Fixed income investments 619.0 4.2 — 623.2 Equity investments — 198.0 — 198.0 Total $ 625.7 $ 223.8 $ — $ 849.5 The expected rate of return on assets for the financial period ending December 31, 2019, was 2.5% p.a. based on financial conditions as of December 31, 2018 (2018: 2.5% p.a.). This rate is derived by taking the weighted average of the long-term expected rate of return on each of the asset classes in JHGPS’s target asset allocation. The expected rate of return has been determined based on yields on either long-dated government bonds or relevant corporate bonds, dependent on the class of asset in question, adjusted where appropriate based on the individual characteristics of each asset class. Actuarial gains and losses Cumulative amounts recognized in accumulated other comprehensive income and the actuarial gain, net of tax deducted at source, credited to other comprehensive income for the years ended December 31, 2019 and 2018, are shown below (in millions): December 31, 2019 2018 Opening accumulated unamortized actuarial gain $ 24.7 $ 21.0 Current year actuarial gain (loss) (5.5) 14.4 Tax at source on current year actuarial gain (loss) 0.9 (6.5) Current year prior service cost 0.4 (3.7) Release of actuarial gain due to settlement event (2.1) (1.1) Release of tax at source due to settlement event 0.7 0.6 Closing accumulated unamortized actuarial gain $ 19.1 $ 24.7 No actuarial gains were amortized from accumulated other comprehensive income during the year ended December 31, 2019 (2018: nil). No actuarial gains are expected to be amortized from accumulated other comprehensive income into net periodic benefit cost during 2019. A high court ruling on October 26, 2018, suggested that most UK pension schemes, including our scheme, will need to amend benefits to correct for inequalities in “guaranteed minimum pensions.” The estimated impact of this ruling on the obligations is estimated as $3.7 million, treated as a prior service cost in 2018 to be amortized in future years; the amount amortized in 2019 was $0.4 million and the amount expected to be amortized in 2020 is $0.4 million. However, considerable legal and other uncertainties remain, and the ultimate cost of amending benefits could be significantly higher or lower. Net periodic benefit cost The components of net periodic benefit cost in respect of defined benefit plans for the years ended December 31, 2019, 2018 and 2017, include the following (in millions): December 31, 2019 2018 2017 Service cost $ (0.8) $ (1.2) $ (1.2) Settlement gain 2.1 1.6 1.6 Interest cost (17.4) (17.3) (19.2) Amortization of prior service cost (0.4) — — Expected return on plan assets 18.6 21.3 20.3 Net periodic benefit credit 2.1 4.4 1.5 Contributions to money purchase section (7.9) (8.0) (7.4) Total cost $ (5.8) $ (3.6) $ (5.9) The following key assumptions were used in determining the net periodic benefit cost for the years ended December 31, 2019, 2018 and 2017 (in millions): December 31, 2019 2018 2017 Discount rate 2.9 % 2.6 % 2.9 % Inflation — salaries 2.5 % 2.5 % 2.5 % Inflation — RPI 3.1 % 3.1 % 3.2 % Inflation — CPI 2.0 % 2.0 % 2.1 % Pension increases (RPI capped at 5% p.a.) 3.0 % 3.0 % 3.0 % Pension increases (RPI capped at 2.5% p.a.) 2.1 % 2.1 % 2.1 % Expected return on plan assets 2.5 % 2.5 % 2.6 % Amortization period for net actuarial gains at beginning of the year 10.0 11.0 11.0 Cash flows Employer contributions of $2.0 million were paid in relation to our defined benefit pension plans during 2019 (excluding credits to members’ Money purchase accounts). We expect to contribute approximately $0.8 million to the JHGPS (excluding credits to members’ Money purchase accounts) in the year ended December 31, 2020. The expected future benefit payments for our pension plan are as follows (in millions): 2020 $ 22.9 2021 $ 20.1 2022 $ 22.0 2023 $ 23.7 2024 $ 25.0 2025-2029 $ 131.1 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 12 Months Ended |
Dec. 31, 2019 | |
Accumulated Other Comprehensive Loss | |
Accumulated Other Comprehensive Loss | N ote 17 — A ccumulated O ther C omprehensive L oss Changes in accumulated other comprehensive loss, net of tax for the years ended December 31, 2019 and 2018, are as follows (in millions): Year ended December 31, 2019 2018 Foreign Retirement benefit Foreign Retirement currency asset, net Total currency asset, net Total Beginning balance $ (448.2) $ 24.7 $ (423.5) $ (325.3) $ 21.0 $ (304.3) Other comprehensive income (loss) 74.7 (5.6) 69.1 (124.3) 3.7 (120.6) Less: other comprehensive loss (income) attributable to noncontrolling interests (12.7) — (12.7) 1.4 — 1.4 Ending balance $ (386.2) $ 19.1 $ (367.1) $ (448.2) $ 24.7 $ (423.5) The components of other comprehensive income (loss), net of tax for the years ended December 31, 2019, 2018 and 2017, are as follows (in millions): Pre-tax Tax Year ended December 31, 2019 amount expense Net amount Foreign currency translation adjustments $ 74.3 $ 0.4 $ 74.7 Retirement benefit asset, net (4.1) (0.1) (4.2) Reclassifications to net income (1.4) — (1.4) Total other comprehensive loss $ 68.8 $ 0.3 $ 69.1 Pre-tax Tax Year ended December 31, 2018 amount benefit Net amount Foreign currency translation adjustments $ (124.3) $ — $ (124.3) Retirement benefit asset, net 4.2 0.6 4.8 Reclassifications to net income (1.1) — (1.1) Total other comprehensive income $ (121.2) $ 0.6 $ (120.6) Pre-tax Tax Year ended December 31, 2017 amount expense Net amount Net unrealized losses on available-for-sale securities $ 1.9 $ — $ 1.9 Foreign currency translation adjustments 125.0 — 125.0 Retirement benefit asset, net (10.2) (0.4) (10.6) Reclassifications to net income (4.4) — (4.4) Total other comprehensive income loss $ 112.3 $ (0.4) $ 111.9 |
Earnings and Dividends Per Shar
Earnings and Dividends Per Share | 12 Months Ended |
Dec. 31, 2019 | |
Earnings and Dividends Per Share | |
Earnings and Dividends Per Share | N ote 18 — E arnings and Dividends Per S hare Earnings Per Share The following is a summary of the earnings per share calculation for the years ended December 31, 2019, 2018 and 2017 (in millions, except per share data): Year ended December 31, 2019 2018 2017 Net income attributable to JHG $ 427.6 $ 523.8 $ 655.5 Less: Allocation of earnings to participating stock-based awards (11.7) (12.7) (17.3) Net income attributable to JHG common shareholders $ 415.9 $ 511.1 $ 638.2 Weighted-average common shares outstanding — basic 188.0 195.0 160.7 Dilutive effect of non-participating stock-based awards 0.6 0.9 1.6 Weighted-average common shares outstanding — diluted 188.6 195.9 162.3 Earnings per share: Basic (two class) $ 2.21 $ 2.62 $ 3.97 Diluted (two class) $ 2.21 $ 2.61 $ 3.93 The share numbers in the table above have been updated to reflect the share consolidation on April 26, 2017. Refer to Note 2 — Summary of Significant Accounting Policies for additional information on the share consolidation. The following instruments are anti-dilutive and have not been included in the weighted-average diluted shares outstanding calculation (in millions): Year ended December 31, 2019 2018 2017 Unvested nonparticipating stock awards 1.1 1.0 0.8 Dai-ichi options — — 10.0 Dividends Per Share The payment of cash dividends is within the discretion of our Board of Directors and depends on many factors, including, but not limited to, our results of operations, financial condition, capital requirements, legal requirements and general business conditions. Since the Closing Date, we have declared dividends quarterly in USD; prior to the Merger, Henderson declared dividends in GBP on a semiannual basis, with an extraordinary first quarter 2017 dividend declared on April 19, 2017. The following is a summary of cash dividends declared and paid for the years ended December 31, 2019, 2018 and 2017, in GBP and USD: Year ended December 31, 2019 2018 2017 Dividends paid per share — pre-Merger — in GBP £ — £ — £ 0.0915 Dividends paid per share — post-Merger — in USD $ 1.4400 $ 1.4000 $ 0.6400 The pre-Merger share numbers in the table above have not been updated to reflect the share consolidation on April 26, 2017. Refer to Note 2 — Summary of Significant Accounting Policies for additional information on the share consolidation. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies | |
Commitments and Contingencies | N ote 19 — C ommitments and C ontingencies Commitments and contingencies may arise in the normal course of business. Commitments and contingencies as of December 31, 2019, are discussed below. Operating and Finance Leases As of December 31, 2019, we had future minimum rental commitments under non-cancelable operating and finance leases. Refer to Note 8 — Leases for information related to operating and financing lease commitments. Litigation and Other Regulatory Matters We are periodically involved in various legal proceedings and other regulatory matters. Richard Pease v. Henderson Administration Limited The outcome of a court case involving an ex-employee was determined in the first quarter of 2018. The case related to the fees we should receive after a fund was transferred to an ex-employee (the “Fund Transfer Fees”) and the ex-employee’s entitlement to deferred and forfeited remuneration. The judgment given in the case resulted in our recognition of a $12.2 million charge in general, administrative and occupancy on our Consolidated Statements of Comprehensive Income after the judge held that the ex-employee was not bound to pay the Fund Transfer Fees and that the ex-employee’s contract gave him an entitlement to deferred and forfeited remuneration. The amount of the charge also included legal costs relating to the case. Henderson Administration Limited (“HAL”), a wholly owned subsidiary of JHG, appealed the part of the judgment relating to the Fund Transfer Fees, and judgment was handed down by the Court of Appeal of England and Wales on February 15, 2019, in favor of HAL. As a result, we were awarded the Fund Transfer Fees and related interest of approximately $5.0 million and $0.3 million, respectively. HAL will also be entitled to certain costs relating to the appeal and the earlier trial insofar as they relate to the Fund Transfer Fees claim. On November 6, 2019, the Supreme Court of the United Kingdom refused the ex-employee’s application for permission to appeal the Court of Appeal’s judgment. Accordingly, the Group recorded the award in its financial statements. Eisenberg v. Credit Suisse AG and Janus Indices, Halbert v. Credit Suisse AG and Janus Indices, Qiu v. Credit Suisse AG and Janus Indices and Y-GAR Capital v. Credit Suisse AG and Janus Indices, and Rubinstein v. Credit Suisse Group AG and Janus Indices On March 15, 2018, a class action lawsuit was filed in the United States District Court for the Southern District of New York (“SDNY”) against Janus Index & Calculation Services LLC, which effective January 1, 2019, was renamed Janus Henderson Indices LLC (“Janus Indices”), a subsidiary of JHG, on behalf of a class consisting of investors who purchased VelocityShares Daily Inverse VIX Short-Term ETN (Ticker: XIV) between January 29, 2018, and February 5, 2018 ( Eisenberg v. Credit Suisse AG and Janus Indices Halbert v. Credit Suisse AG and Janus Indices 2018, a third lawsuit, styled as a class action on behalf of investors who purchased XIV between January 29, 2018, and February 5, 2018, was filed against Janus Indices and Credit Suisse AG in the SDNY ( Qiu v. Credit Suisse AG and Janus Indices Halbert Qiu Eisenberg On August 20, 2018, an amended complaint was filed in the Eisenberg Qiu Set Capital LLC, et al. v. Credit Suisse AG, et al. Set Capital The defendants in Halbert – Credit Suisse and Janus Indices – jointly moved to dismiss the amended complaint. On August 22, 2019, the court granted in part and denied in part the defendants’ motion to dismiss the claims. The court dismissed all claims against Janus Indices – including all federal securities claims – other than a claim for negligent misrepresentation. On September 26, 2019, Janus Indices filed its answer to the complaint. As of December 31, 2019, the case remains in the discovery phase. On February 4, 2019, a fourth lawsuit was filed against Janus Indices, Janus Distributors LLC, Janus Henderson Group plc and various Credit Suisse persons in the SDNY (Rubinstein v. Credit Suisse Group AG, et al.). The suit was styled as a class action and involved VelocityShares Daily Inverse VIX Medium-Term ETN (Ticker: ZIV), but otherwise generally copied the allegations in the XIV cases described above. On August 20, 2019, an amended complaint was filed, which eliminated each of the Janus Henderson entities as defendants, thus dismissing all claims against them. On February 7, 2019, a fifth lawsuit was filed against Janus Indices, Janus Distributors LLC, Janus Henderson Group plc, and Credit Suisse in the United States District Court for the Eastern District of New York (“EDNY”) by certain investors in XIV (Y-GAR Capital LLC v. Credit Suisse Group AG, et al.). The allegations in Y-GAR generally asserted that the disclosures relating to XIV were false and misleading. On March 29, 2019, the plaintiff withdrew the suit from the EDNY and re-filed it in the SDNY. The Janus Henderson and Credit Suisse defendants each moved to dismiss the claims against them. On January 2, 2020, the court dismissed all claims against all defendants. We believe that the remaining claims in these exchange-traded note lawsuits are without merit and are vigorously defending these actions. As of December 31, 2019, we cannot reasonably estimate possible losses from the remaining claims in the exchange-traded note lawsuits. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Transactions | |
Related Party Transactions | Note 20 — Related Party Transactions Disclosures relating to equity method investments and our pension scheme can be found in Note 9 — Equity Method Investments and Note 16 — Retirement Benefit Plans, respectively. Transactions between JHG and our controlled subsidiaries have been eliminated on consolidation and are not disclosed in this note. Certain managed funds are deemed to be related parties of JHG under the related party guidance. We earn fees from the funds for which we act as investment manager and the balance sheet includes amount due from these managed funds. During the years ended December 31, 2019, 2018 and 2017, we recognized revenues of $1,870.1 million, $1,953.2 million and $1,473.5 million, respectively, from the funds we manage that are related parties and not consolidated, in our Consolidated Statements of Comprehensive Income. The following table reflects amounts in our Consolidated Balance Sheets relating to fees receivable from managed funds: As of December 31 2019 2018 Accrued income $ 198.2 $ 187.2 Accounts receivable 34.0 29.7 Dai-ichi is a significant shareholder of JHG. Investment management fees attributable to Dai-ichi separate accounts for the years ended December 31, 2019 and 2018, were $15.8 million and $14.9 million, respectively. Seed investments held in managed funds are discussed in Note 5 – Consolidation. |
Geographic Information
Geographic Information | 12 Months Ended |
Dec. 31, 2019 | |
Geographic Information | |
Geographic Information | Note 21 — Geographic Information The following summary provides information concerning our principal geographic areas for the years ended and as of December 31, 2019, 2018 and 2017 (in millions): Year ended December 31, Operating revenues 2019 2018 2017 U.S. $ 1,353.0 $ 1,338.7 $ 818.1 UK 602.4 649.4 669.0 Luxembourg 182.3 255.9 280.9 International 54.7 62.4 50.3 Total $ 2,192.4 $ 2,306.4 $ 1,818.3 Operating revenues are attributed to countries based on the location in which revenues are earned. As of December 31, Long-lived assets 2019 2018 UK $ 384.8 $ 366.8 U.S. 2,569.4 2,604.2 Australia 216.1 219.3 Other 3.0 2.5 Total $ 3,173.3 $ 3,192.8 Long-lived assets include property, equipment, software and intangible assets. As of December 31, 2019, intangible assets in the U.S, UK and Australia were $2,536.0 million, $337.5 million and $215.1 million, respectively. As of December 31, 2018, intangible assets in the U.S., UK and Australia were $2,580.8 million, $324.5 million and $218.0 million, respectively. |
Selected Quarterly Financial Da
Selected Quarterly Financial Data | 12 Months Ended |
Dec. 31, 2019 | |
Selected Quarterly Financial Data | |
Selected Quarterly Financial Data | Note 22 — Selected Quarterly Financial Data (Unaudited) 2019 First Second Third Fourth (in millions, except per share amounts) quarter quarter quarter quarter Full year Total revenue $ 519.3 $ 535.9 $ 536.0 $ 601.2 $ 2,192.4 Operating income 124.5 118.5 143.6 154.3 540.9 Net income 99.9 112.3 113.1 120.4 445.7 Net income attributable to noncontrolling interests (5.8) (2.9) (1.0) (8.4) (18.1) Net income attributable to JHG 94.1 109.4 112.1 112.0 427.6 Basic earnings per share attributable to JHG common shareholders $ 0.48 $ 0.56 $ 0.58 $ 0.59 $ 2.21 Diluted earnings per share attributable to JHG common shareholders $ 0.48 $ 0.56 $ 0.58 $ 0.59 $ 2.21 2018 First Second Third Fourth (in millions, except per share amounts) quarter quarter quarter quarter Full year Total revenue $ 587.7 $ 592.4 $ 581.2 $ 545.1 $ 2,306.4 Operating income 176.2 175.3 148.3 150.0 649.8 Net income 163.2 130.5 105.1 100.8 499.6 Net income attributable to noncontrolling interests 2.0 10.1 6.1 6.0 24.2 Net income attributable to JHG 165.2 140.6 111.2 106.8 523.8 Basic earnings per share attributable to JHG common shareholders $ 0.82 $ 0.70 $ 0.55 $ 0.54 $ 2.62 Diluted earnings per share attributable to JHG common shareholders $ 0.82 $ 0.70 $ 0.55 $ 0.54 $ 2.61 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Significant Accounting Policies | |
Basis of Presentation | Basis of Presentation Our consolidated financial statements have been prepared according to U.S. GAAP and include all majority-owned subsidiaries and consolidated seeded investment products. Intercompany accounts and transactions have been eliminated in consolidation. Events subsequent to the balance sheet date have been evaluated for inclusion in the accompanying consolidated financial statements through the issuance date. Prior to the Merger, Henderson’s functional currency was GBP. After consideration of numerous factors, such as the denomination of its shares, payments of dividends and our main economic environment, management concluded that the post-Merger functional currency of JHG is USD. Certain prior year amounts in our Consolidated Statements of Comprehensive Income have been reclassified to conform to current year presentation. Specifically, revenue amounts related to certain transfer agent and administrative activities performed for investment products that were previously classified in other revenue were reclassified to shareowner servicing fees. There is no change to consolidated total revenue, operating income, net income or cash flows as a result of this change in classification. |
Accounting Estimates | Accounting Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates and the differences could be material. Our significant estimates relate to investment securities, acquisition accounting, goodwill and intangible assets, retirement benefit assets and obligations, contingent consideration, equity compensation and income taxes. |
Segment Information | Segment Information We are a global asset manager and manage a range of investment products, operating across various product lines, distribution channels and geographic regions. However, resources are allocated and the business is managed by the chief operating decision-maker, the CEO, on an aggregated basis. Strategic and financial management decisions are determined centrally by the CEO and, on this basis, we operate as a single segment investment management business. |
Consolidation of Investment Products | Consolidation of Investment Products We perform periodic consolidation analyses of our seeded investment products to determine if the product is a VIE or a VRE. Factors considered in this assessment include the product’s legal organization, the product’s capital structure and equity ownership, and any de facto agent implications of our involvement with the product. Investment products that are determined to be VIEs are consolidated if we are the primary beneficiary of the product. VREs are consolidated if we hold the majority voting interest. Upon the occurrence of certain events (such as contributions and redemptions, either by JHG or third parties, or amendments to the governing documents of our investment products), management reviews and reconsiders its previous conclusion regarding the status of a product as a VIE or a VRE. Additionally, management continually reconsiders whether we are considered a VIE’s primary beneficiary, and thus consolidates such product. Variable Interest Entities Certain investment products for which a controlling financial interest is achieved through arrangements that do not involve or are not directly linked to voting interests are considered VIEs. We review factors, including whether or not (i) the product has equity that is sufficient to permit it to finance its activities without additional subordinated support from other parties and (ii) the equity holders at risk have the obligation to absorb losses, the right to receive residual returns and the right to direct the activities of the product that most significantly impact the product’s economic performance, to determine if the investment product is a VIE. We re-evaluate such factors as facts and circumstances change. We consolidate a VIE if we are the VIE’s primary beneficiary. The primary beneficiary of a VIE is defined as the variable interest holder that has a controlling financial interest in the VIE. A controlling financial interest is defined as (i) the power to direct the activities of the VIE that most significantly impact its economic performance and (ii) the obligation to absorb losses of the product or the right to receive benefits from the product that potentially could be significant to the VIE. We are the manager of various types of seeded investment products, which may be considered VIEs. Our involvement in financing the operations of the VIEs is generally limited to its investments in the products. VIEs are generally subject to consolidation by us at lower ownership percentages than the 50% threshold applied to VREs and are also subject to specific disclosure requirements. Voting Rights Entities We consolidate seeded investment products accounted for as VREs when we are considered to control such products, which generally exists if we have a greater than 50% voting equity interest. |
Property, Equipment and Software | Property, Equipment and Software Property, equipment and software are recorded at cost. Depreciation is recorded using the straight-line method over the estimated useful life of the related assets (or the lease term, if shorter). Depreciation expense totaled $23.5 million, $24.7 million and $24.6 million for the years ended December 31, 2019, 2018 and 2017, respectively. Property, equipment and software are summarized as follows (in millions): Depreciation December 31, period 2019 2018 Furniture, fixtures and computer equipment 3-10 years $ 36.1 $ 31.3 Leasehold improvements Over the shorter of 20 years or the period of the lease 38.0 35.3 Computer software 3-7 years 83.1 65.6 Property, equipment and software, gross $ 157.2 $ 132.2 Accumulated depreciation (72.5) (62.7) Property, equipment and software, net $ 84.7 $ 69.5 Computer software is recorded at cost and depreciated over its estimated useful life. Internal and external costs incurred in connection with researching or obtaining computer software for internal use are expensed as incurred during the preliminary project stage, as are post-implementation training and maintenance costs. Internal and external costs incurred for internal use software during the application development stage are capitalized until such time that the software is substantially complete and ready for its intended use. Application development stage costs are depreciated on a straight-line basis over the estimated useful life of the software. We evaluate our property, equipment and software assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The evaluation is based on an estimate of the future cash flows expected to result from the use of the asset and its eventual disposal. If expected future undiscounted cash flows are less than the carrying amount of the asset, an impairment loss is recognized in an amount equal to the excess of the carrying amount of the asset over the fair value of the asset. There were no impairments of property, equipment and software for the years ended December 31, 2019, 2018 and 2017. |
Deferred Commissions | Deferred Commissions Initial sales commissions paid to and received from financial intermediaries on sales of certain wholesale products are deferred and amortized over various periods, not exceeding four years. The amortization period is based on the average expected life of the product on which the commission is received. Deferred commissions are recognized as components of other current assets and of accounts payable and accrued liabilities on the Consolidated Balance Sheets. |
Equity Method Investments | Equity Method Investments Our investment in equity method investees, where we do not control the investee but can exert significant influence over the financial and operating policies (generally considered to be ownership between 20% and 50%), as well as in joint ventures where there is joint control (and in both cases, where we are not the primary beneficiary of a VIE), are accounted for using the equity method of accounting. Investments are initially recognized at cost when purchased for cash, or at the fair value of shares received where acquired as part of a wider transaction. The investments are subsequently carried at cost adjusted for our share of net income or loss and other changes in comprehensive income of the equity method investee, less any dividends or distributions received by us. The Consolidated Statements of Comprehensive Income includes our share of net income or loss for the year, or period of ownership, if shorter, within other non-operating income (expenses), net. |
Financial Instruments | Financial Instruments Financial assets are recognized at fair value in the Consolidated Balance Sheets when we become a party to the contractual provisions of an instrument. The fair value recognized is adjusted for transaction costs, except for financial assets classified as trading where transaction costs are recognized immediately in net income. Financial assets are derecognized when the rights to receive cash flows from the investments have expired or where they have been transferred and we have also transferred substantially all the risks and rewards of ownership. Purchases and sales of financial assets are recognized at the trade date. Delivery and settlement terms are usually determined by established practices in the market concerned. Debt securities, equity securities and holdings in pooled funds are measured at subsequent reporting dates at fair value. We determine the classification of its financial assets on initial recognition. Unrealized gains and losses represent the difference between the fair value of the financial asset at the reporting date and cost or, if these have been previously revalued, the fair value at the last reporting date. Realized gains and losses on financial assets are calculated as the difference between the net sales proceeds and cost or amortized cost using the specific identification method. Financial liabilities, excluding contingent consideration, derivatives, fund deferral liabilities and redeemable noncontrolling interests in consolidated funds which are stated at fair value, are stated at amortized cost using the effective interest rate method. Financial liabilities stated at amortized cost include our long-term debt. Amortized cost is calculated by taking into account any issue costs and any discount or premium on settlement. Financial liabilities cease to be recognized when the obligation under the liability has been discharged or cancelled or has expired. |
Investment Securities | Investment Securities Seeded Investment Products We periodically add new investment strategies to our investment product offerings by providing the initial cash investment or “seeding.” The primary purpose of seeded investment products is to generate an investment performance track record in a product to attract third-party investors. Seeded investment products are initially consolidated and the individual securities within the portfolio are accounted for as trading securities. The change in fair value of seeded investment products is recorded in investment gains (losses), net on our Consolidated Statements of Comprehensive Income. Noncontrolling interests in seeded investment products represent third-party ownership interests and are included in investment securities on our Consolidated Balance Sheets. These assets are not available for general corporate purposes and may be redeemed by the third parties at any time. Refer to the consolidation discussion in this note for information regarding the consolidation of certain seeded investment products. We may redeem invested seed capital for a variety of reasons, including when third-party investments in the relevant product are sufficient to sustain the given investment strategy. The length of time we hold a majority interest in a product varies based on a number of factors, including market demand, market conditions and investment performance. Investments in Advised Mutual Funds and Investments Related to the Economic Hedging of Deferred Compensation We grant mutual fund share awards to employees that are indexed to certain funds managed by us. Upon vesting, participants receive the value of the mutual fund share awards adjusted for gains or losses attributable to the mutual funds to which the award was indexed, subject to tax withholding, or participants receive shares in the mutual fund. When investments in our fund products are purchased and held against deferred compensation liabilities, any movement in the fair value of the assets and corresponding movements in the deferred compensation liability are recognized in the Consolidated Statements of Comprehensive Income. We maintain deferred compensation plans for certain highly compensated employees and members of its Board of Directors. Eligible participants may defer a portion of their compensation and have the ability to earn a return by indexing their deferrals to mutual funds managed by us and our subsidiaries. We make no contributions to the plans. To protect against market variability of the liability, we create an economic hedge by investing in mutual funds that are consistent with the deferred amounts and mutual fund elections of the participants. Such investments remain assets of JHG. Changes in market value of the liability to participants are recognized as long-term incentive compensation in our Consolidated Statements of Comprehensive Income, and changes in the market value of the mutual fund securities are recognized in investment gains (losses), net on our Consolidated Statements of Comprehensive Income. Other Investment Securities Other investment securities primarily represent investments in our fund products held by employee benefit trusts, certain investments in unconsolidated seed capital investments and certain investments in consolidated funds. Gains and losses arising from changes in the fair value of these securities are included within investments gains (losses), net in the Consolidated Statements of Comprehensive Income. Where investments in our fund products are held against outstanding deferred compensation liabilities, any movement in the fair value of these assets and corresponding movements in the deferred compensation liability are recognized in the Consolidated Statements of Comprehensive Income. Trade Receivables Trade receivables, which generally have 30-day payment terms, are initially recognized at fair value, which is normally equivalent to the invoice amount. When the time value of money is material, the fair value is discounted. Provision for specific doubtful accounts is made when there is evidence that we may not be able to recover balances in full. Balances are written off when the receivable amount is deemed uncollectable. OEIC and Unit Trust Receivables and Payables OEIC and unit trust receivables and payables are in relation to the purchase of units/shares (by investors) and the liquidation of units/shares (owned by trustees). The amounts are dependent on the level of trading and fund switches in the four working days leading up to the end of the period. Since they are held with different counterparties, the amounts are presented gross on our Consolidated Balance Sheets. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents primarily consist of cash held at banks, on-demand deposits, highly liquid short-term government securities and investments in money market instruments with a maturity date of three months or less. Cash balances maintained by consolidated VREs are not considered legally restricted and are included in cash and cash equivalents on the Consolidated Balance Sheets. Cash balances held by consolidated VIEs are disclosed separately as a component of assets of consolidated VIEs on the Consolidated Balance Sheets. |
Derivative Instruments | Derivative Instruments We may, from time to time, use derivative financial instruments to mitigate price, interest rate, foreign currency and credit risk. We do not designate derivative instruments as hedges for accounting purposes, with the exception of certain foreign currency forward contracts used for net investment hedging. Derivative instruments are measured at fair value and classified as either other current assets or accounts payable and accrued liabilities on our Consolidated Balance Sheets. Changes in the fair value of derivative instruments are recorded within investment gains (losses), net in our Consolidated Statements of Comprehensive Income. Changes in fair value of foreign currency forward contracts designated as hedges for accounting purposes are recognized in accumulated other comprehensive income under net investment hedge accounting. Our consolidated seed investments may also be party to derivative instruments. These derivative instruments are disclosed separately from our corporate derivative instruments. Refer to Note 6 – Investment Securities. |
Leases | Leases We determine if an arrangement is a lease at inception. Operating lease right-of-use (“ROU”) assets are included in other non-current assets in our Consolidated Balance Sheets. The current and non-current portions of operating lease liabilities are included in accounts payable and accrued liabilities and in other non-current liabilities, respectively. Finance lease ROU assets are included in property, equipment and software, net, and finance lease liabilities are included in other non-current liabilities. ROU assets represent our right to use an underlying asset for the lease term, and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that the option will be exercised. Lease expense for lease payments is recognized on a straight-line basis over the lease term. |
Nonredeemable Noncontrolling Interests and Redeemable Noncontrolling Interests | Nonredeemable Noncontrolling Interests and Redeemable Noncontrolling Interests Nonredeemable noncontrolling interests that are not subject to redemption rights are classified in permanent equity. Redeemable noncontrolling interests are classified outside of permanent equity on the Consolidated Balance Sheets and are measured at the estimated fair value as of the balance sheet date. Noncontrolling interests in consolidated seed investments are classified as redeemable noncontrolling interests where there is an obligation on the fund to repurchase units at the investor’s request. Refer to Note 14 – Noncontrolling Interests for further information. |
Fair Value Measurements | Fair Value Measurements Fair value is the price that would be received to sell an asset or transfer a liability in an orderly transaction between market participants at the measurement date. The fair value of financial instruments traded in active markets (such as publicly traded securities and derivatives) is based on quoted market prices at the reporting date. The quoted market price used for financial instruments is the last traded market price for both financial assets and financial liabilities where the last traded price falls within the bid ask spread. In circumstances where the last traded price is not within the bid ask spread, management will determine the point within the bid ask spread that is most representative of fair value current bid price. The fair value of financial instruments that are not traded in an active market is determined using valuation techniques commonly used by market participants, including the use of comparable recent arm’s length transactions, discounted cash flow analysis and option pricing models. Estimating fair value requires significant management judgment, including benchmarking to similar instruments with observable market data and applying appropriate discounts that reflect differences between the securities that we are valuing and the selected benchmark. Measurements of fair value are classified within a hierarchy that prioritizes the inputs to valuation techniques used to measure fair value based on whether the inputs to those valuation techniques are observable or unobservable. The valuation hierarchy contains three levels: ● Level 1—Valuation inputs are unadjusted quoted market prices for identical assets or liabilities in active markets. ● Level 2—Valuation inputs are quoted market prices for identical assets or liabilities in markets that are not active, quoted market prices for similar assets and liabilities in active markets, and other observable inputs directly or indirectly related to the asset or liability being measured. ● The valuation of an asset or liability may involve inputs from more than one level of the hierarchy. The level in the fair value hierarchy within which a fair value measurement in its entirety falls is determined based on the lowest level input that is significant to the fair value measurement. Level 1 Fair Value Measurements Our Level 1 fair value measurements consist mostly of seeded investment products, investments in advised mutual funds, cash equivalents and investments related to deferred compensation plans with quoted market prices in active markets. The fair value level of consolidated seeded investment products is determined by the underlying securities of the product. The fair value level of unconsolidated seeded investment products is determined using the underlying inputs used in the calculation of the NAV of each product. Level 2 Fair Value Measurements Our Level 2 fair value measurements consist mostly of consolidated seeded investment products and our long-term debt. The fair value of consolidated seeded investment products is determined by the underlying securities of the product. The fair value of our long-term debt is determined using broker quotes and recent trading activity, which are considered Level 2 inputs. Level 3 Fair Value Measurements Our assets and liabilities measured at Level 3 are primarily private equity investments, contingent deferred consideration and deferred compensation liabilities that are held against investments in our fund products, where the significant valuation inputs are unobservable. Private equity investments are valued using a combination of the enterprise value/EBITDA multiple method and the discounted cash flow method. Significant unobservable inputs include discount rates, EBITDA multiple and price-earnings ratio, taking into account management’s experience and knowledge of market conditions of the specific industries. Details of inputs used to calculate the fair value of contingent deferred consideration can be found in Note 10 – Fair Value Measurements. Nonrecurring Fair Value Measurements Nonrecurring Level 3 fair value measurements include goodwill and intangible assets. We measure the fair value of goodwill and intangible assets on initial recognition using discounted cash flow analysis that requires assumptions regarding projected future earnings and discount rates. Because of the significance of the unobservable inputs in the fair value measurements of these assets and liabilities, such measurements are classified as Level 3. See the Goodwill and Intangible Assets, Net accounting policy set forth within this note for further information. |
Income Taxes | Income Taxes We provide for current tax expense according to the tax laws in each jurisdiction in which we operate, using tax rates and laws that have been enacted by the balance sheet date. Deferred income tax assets and liabilities are recorded for temporary differences between the financial statement and income tax basis of assets and liabilities as measured by the enacted income tax rates that may be in effect when these differences reverse. The effect of changes in tax rates on our deferred tax assets and liabilities is recognized as income tax within net income in the period that includes the enactment date. Significant management judgment is required in developing our provision for income taxes, including the valuation allowances that might be required against deferred tax assets and the evaluation of unrecognized tax benefits resulting from uncertain tax positions taken or expected to be taken in a tax return. We periodically assess the recoverability of our deferred tax assets and the need for valuation allowances on these assets. We make these assessments based on the weight of available evidence regarding possible sources of future taxable income and estimates relating to the future performance of the business that results in taxable income. In evaluating uncertain tax positions, we consider the probability that the tax benefit can be sustained on examination by a taxing authority on the basis of its technical merits (“the recognition threshold”). For tax positions meeting this threshold, the amount recognized in the financial statements is the benefit expected to be realized upon settlement with the taxing authority on the basis of a cumulative-probability assessment of the possible outcomes. For tax positions not meeting the recognition threshold, no financial statement benefit is recognized. We recognize the accrual of interest and penalties on uncertain tax positions as a component of the income tax provision. |
Revenue Recognition Policy | Revenue Recognition Revenue is measured and recognized based on the five-step process outlined in U.S. GAAP. Revenue is determined based on the transaction price negotiated with the customer, net of rebates. Management fees, performance fees, shareowner servicing fees and other revenue are derived from providing professional services to manage investment products. Management fees are earned over time as services are provided and are generally based on a percentage of the market value of AUM. These fees are calculated as a percentage of either the daily, month-end or quarter-end average asset balance in accordance with contractual agreements. Performance fees are specified in certain fund and client contracts and are based on investment performance either on an absolute basis or compared to an established index over a specified period of time. Performance fees are generated on certain management contracts when performance hurdles or other specified criteria are achieved. Performance fees for all fund ranges and separate accounts are recognized when it is probable that a significant reversal of revenue recognized will not occur in future periods. There are no performance fee contracts where revenue can be clawed back. There are no cumulative revenues recognized that would be reversed if all of the existing investments became worthless. Management fees are primarily received monthly or quarterly, while performance fees are usually received monthly, quarterly or annually, although the frequency of receipt varies between agreements. Management and performance fee revenue earned but not yet received is recognized within fees and other receivables on our Consolidated Balance Sheets. Shareowner servicing fees are earned for services rendered related to transfer agent and administrative activities performed for investment products. These services are transferred over time and are generally based on a percentage of the market value of AUM. Other revenue includes distribution and servicing fees earned from U.S. mutual funds associated with mutual fund transfer agent, accounting, shareholder servicing and participant recordkeeping activities. These services are transferred over time and are generally based on a percentage of the market value of AUM. U.S. Mutual Fund Performance Fees The investment management fee paid by each U.S. mutual fund subject to a performance fee is the base management fee plus or minus a performance fee adjustment as determined by the relative investment performance of the fund compared to a specified benchmark index. Under the performance-based fee structure, the investment advisory fee paid by each fund consists of two components: (i) a base fee calculated by applying the contractual fixed rate of the advisory fee to the fund’s average daily net assets during the previous month, plus or minus (ii) a performance fee adjustment calculated by applying a variable rate of up to 0.15% to the fund’s average daily net assets during the performance measurement period. The performance measurement period begins as a trailing period ranging from 12 to 18 months , and each subsequent month is added to each successive performance measurement period until a 36-month period is achieved. At that point, the measurement period becomes a rolling 36-month period. The addition of performance fees to all funds without such fees is subject to the approval of both a majority of the shareholders of such funds and the funds’ independent board of trustees. Principal Versus Agent We utilize third-party intermediaries to fulfill certain performance obligations in our revenue agreements. Generally, we are deemed to be the principal in these arrangements because we control the investment management and other related services before they are transferred to customers. Such control is evidenced by our primary responsibility to customers, the ability to negotiate the third-party contract price and select and direct third-party service providers, or a combination of these factors. Therefore, distribution and service fee revenues and the related third-party distribution and service expenses are reported on a gross basis. |
Operating Expenses | Operating Expenses Operating expenses are accrued and recognized as incurred. |
Stock-Based Compensation | Stock-Based Compensation We grant stock-based awards to our employees, all of which are classified as equity settled stock-based payments. Equity settled stock-based payments are measured at the fair value of the shares at the grant date. The awards are expensed, with a corresponding increase in reserves, on a graded basis over the vesting period. Forfeitures are recognized as they occur. The grant date fair value for stock options is determined using the Black-Scholes option pricing model, and the grant date fair value of restricted stock is determined from the market price on the date of grant. The Black-Scholes model requires management to determine certain variables; the assumptions used in the Black-Scholes option pricing model include dividend yield, expected volatility, risk-free interest rate and expected life. The dividend yield and expected volatility are determined using historical Group data. The risk-free interest rate for options granted is based on the three year UK treasury coupon at the time of the grant. The expected life of the stock options is the same as the service conditions applicable to all Group awards. We generally use the Monte Carlo model to determine the fair value of performance-based awards. The assumptions used in the Monte Carlo model include dividend yield, share price volatility and discount rate. We had no stock-based compensation costs included in retained earnings during the years ended December 31, 2019 and 2018, and $9.9 million of costs included in retained earnings during the years ended December 31, 2017. We had no proceeds from stock-based compensation plans included in retained earnings for the years ended December 31, 2019, 2018 and 2017. Prior to our Extraordinary General Meeting (“EGM”) on April 26, 2017, our articles of association did not allow us to recognize these items in additional paid-in-capital. A change in our articles of association was approved at the EGM and from April 26, 2017, all costs in relation to stock-based compensation will be recognized in additional paid-in-capital. There was no accumulated balance in relation to stock-based compensation plans within retained earnings as of December 31, 2019 and 2018. |
Commissions | Commissions Commissions on management fees are accounted for on an accrual basis and are recognized in the accounting period in which the associated management fee is earned. |
Earnings Per Share | Earnings Per Share Basic earnings per share attributable to our shareholders is calculated by dividing net income (adjusted for the allocation of earnings to participating restricted stock awards) by the weighted average number of shares outstanding. We have calculated earnings per share using the two-class method. There are some participating restricted stock awards that are paid non-forfeitable dividends. Under the two-class method, net income attributable to JHG is adjusted for the allocation of earnings to participating restricted stock awards. Diluted earnings per share is calculated in a similar way to basic earnings per share but is adjusted for the effect of potential common shares unless they are anti-dilutive. |
Contingent Consideration | Contingent Consideration Contingent consideration, resulting from business combinations, is recognized at fair value at the acquisition date as part of the business combination and discounted where the time value of money is material. The determination of the fair value is based on discounted cash flows, with the key assumptions being the probability of meeting each performance target and the discount factor applied. When the contingent consideration meets the definition of a financial liability, it is subsequently re-measured to fair value at each reporting date through other non-operating income. Finance charges, where discounting has been applied, are also recognized through other non-operating income. See Note 10 – Fair Value Measurements for further information about contingent consideration on acquisitions taking place during the reporting period. |
Goodwill and Intangible Assets, Net | Goodwill and Intangible Assets, Net Goodwill represents the excess of cost over the fair value of the identifiable net assets of acquired companies and is capitalized in the Consolidated Balance Sheets. Intangible assets consist primarily of investment management contracts and trademarks acquired as part of business combinations. Investment management contracts have been identified as separately identifiable intangible assets arising on the acquisition of subsidiaries or businesses. Such contracts are recognized at the present value of the expected future cash flows of the investment management contracts at the date of acquisition. Investment management contracts may be classified as either indefinite-lived investment management contracts or finite-lived client relationships. Indefinite-lived intangible assets comprise investment management agreements where the agreements are with investment companies themselves and not with underlying investors. Such contracts are typically renewed indefinitely and, therefore, we consider the contract life to be indefinite and, as a result, the contracts are not amortized. Definite-lived intangible assets comprise investment management agreements where the agreements are with the underlying investor. Indefinite-lived intangible assets and goodwill are not amortized. Definite-lived client relationships are amortized on a straight-line basis over their remaining useful lives. Goodwill is reviewed for impairment annually or more frequently if changes in circumstances indicate that the carrying value may be impaired. We have determined that we have one reporting unit for goodwill impairment testing purposes, which is consistent with internal management reporting and management’s oversight of operations. We may first assess goodwill for impairment using qualitative factors to determine whether it is necessary to perform a quantitative impairment test. We chose to forego the qualitative test and instead perform a quantitative impairment test, determining the enterprise value of the reporting unit and comparing it to our equity balance (carrying amount). If the fair value is less than the carrying amount, an impairment is recognized. Any impairment is recognized immediately through net income and cannot subsequently be reversed. Intangible assets subject to amortization are tested for impairment whenever events or circumstances indicate that the carrying value may not be recoverable, and indefinite-lived assets are tested for impairment annually or more frequently if changes in circumstances indicate that the carrying value may be impaired. Goodwill and intangible assets require significant management estimates and judgment, including the valuation and expected life determination in connection with the initial purchase price allocation and the ongoing evaluation for impairment. |
Foreign Currency | Foreign Currency Transactions in foreign currencies are recorded at the appropriate exchange rate prevailing at the date of the transaction. Foreign currency monetary balances at the reporting date are converted at the prevailing exchange rate. Foreign currency non-monetary balances carried at fair value or cost are translated at the rates prevailing at the date when the fair value or cost is determined. Gains and losses arising on retranslation are recognized as a component of net income. On consolidation, the assets and liabilities of our operations for which the functional currency is not USD are translated at exchange rates prevailing at the reporting date. Income and expense items are recognized at an average monthly exchange rate. Exchange differences arising, if any, are taken through other comprehensive income to accumulated other comprehensive income. Where net investment hedge accounting is applied using foreign currency forward contracts, the fair value movement on these contracts is also recognized within accumulated other comprehensive income. In the period in which an operation is disposed of, translation differences previously recognized in accumulated other comprehensive income are recognized as a component of net income. |
Post-Employment Retirement Benefits | Post-Employment Retirement Benefits We provide employees with retirement benefits through both defined benefit and defined contribution plans. The assets of these plans are held separately from our general assets in trustee-administered funds. Contributions to the defined contribution plan are expensed to employee compensation and benefits on the Consolidated Statements of Comprehensive Income when they become payable. Defined benefit obligations and the cost of providing benefits are determined annually by independent qualified actuaries using the projected unit credit method. Our annual measurement date of the defined benefit plan is December 31. The defined benefit obligation is measured as the present value of the estimated future cash outflows using a discount rate based on AA-rated corporate bond yields of appropriate duration. The plan assets are recognized at fair value. The funded status of the defined benefit pension plans (the resulting surplus or deficit of defined benefit assets less liabilities) is recognized in the Consolidated Balance Sheets, net of any taxes that would be deducted at source. Actuarial gains and losses arise as a result of the difference between actual experience and actuarial assumptions. We have adopted the 10% corridor method for recognizing actuarial gains and losses, which means that cumulative actuarial gains or losses up to an amount equal to 10% of the higher of the liabilities or assets of the scheme (the corridor) have no immediate impact on net income and are instead recognized through other comprehensive income. Cumulative gains or losses greater than the corridor are amortized to net income over the average remaining future working lifetime of the active members in the plan. Net periodic benefit cost is recorded as a component of net income in the Consolidated Statements of Comprehensive Income and includes service cost, interest cost, expected return on plan assets and any actuarial gains and losses previously recognized as a component of other comprehensive income that have been amortized in the period. Net periodic benefit costs are recognized as an operating expense. See Note 16 – Retirement Benefit Plans for further discussion of our pension plans. |
Common Stock | Common Stock JHG’s ordinary shares, par value $1.50 per share, are classified as equity instruments. Equity shares issued by us are recorded at the fair value of the proceeds received or the market price on the day of issue. Direct issue costs, net of tax, are deducted from additional paid-in-capital within equity. Treasury shares held are equity shares of JHG acquired by or issued to employee benefit trusts. Treasury shares held are recorded at cost and are deducted from equity. No gain or loss is recognized in the Consolidated Statements of Comprehensive Income on the purchase, issue, sale or cancellation of our own equity shares. Share Redenomination and Consolidation On April 26, 2017, Henderson redenominated its ordinary shares from GBP to USD, resulting in a change in par value from £0.125 to $0.1547 per share. At that time, Henderson had 1,131,842,110 shares in issue and as a result, the ordinary share nominal capital became $175.1 million. The difference between the revised ordinary share nominal capital balance of $175.1 million and the previously stated ordinary share nominal capital balance of $234.4 million (converted at the historic exchange rate rather than the rate required for the redenomination under Jersey company law) was recognized as a component of additional paid-in-capital. Consequently, the additional paid-in-capital balance was adjusted from $1,237.9 million to $1,297.2 million. Additionally, in accordance with a special resolution passed by the shareholders on May 3, 2017, the par value of the shares of Henderson was reduced to $0.15 per share, from $0.1547 per share, and the total ordinary share nominal capital became $169.8 million. In accordance with that resolution, the reduction in the total ordinary share nominal capital of $5.3 million was credited to the additional paid-in-capital account, which moved from $1,297.2 million to $1,302.5 million. On April 26, 2017, the shareholders approved a 10-to-1 share consolidation, which took effect on May 30, 2017. As a result of the share consolidation, the number of shares in issue was reduced by a factor of 10, and the par value of the shares became $1.50. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Significant Accounting Policies | |
Schedule of property, equipment and software | Property, equipment and software are summarized as follows (in millions): Depreciation December 31, period 2019 2018 Furniture, fixtures and computer equipment 3-10 years $ 36.1 $ 31.3 Leasehold improvements Over the shorter of 20 years or the period of the lease 38.0 35.3 Computer software 3-7 years 83.1 65.6 Property, equipment and software, gross $ 157.2 $ 132.2 Accumulated depreciation (72.5) (62.7) Property, equipment and software, net $ 84.7 $ 69.5 |
Acquisitions and Dispositions (
Acquisitions and Dispositions (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Acquisitions and Dispositions | |
Summary of unaudited supplemental pro forma operating results and JCG results of operations included in JHG's Condensed Consolidated Statements of Comprehensive Income | The following table presents summarized unaudited supplemental pro forma operating results as if the Merger had occurred at the beginning of January 1, 2016 (in millions): Year ended December 31, 2017 Revenue $ 2,182.6 Net income attributable to JHG $ 704.6 JCG Results of Operations Revenue (inclusive of revenue from certain mandates transferred to JCG from Henderson after the Merger) and net income of JCG from the Closing Date through the end of December 31, 2017, included in JHG’s Consolidated Statements of Comprehensive Income are presented in the following table (in millions): Closing Date — December 31, 2017 Revenue $ 752.9 Net income attributable to JCG $ 354.0 |
Consolidation (Tables)
Consolidation (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Consolidation | |
Schedule of consolidated voting right entities (VREs) | The following table presents the balances related to consolidated VREs that were recorded on JHG’s Consolidated Balance Sheets, including our net interest in these products (in millions): December 31, December 31, 2019 2018 Investment securities $ 29.9 $ 13.9 Cash and cash equivalents 1.5 1.4 Other current assets 0.2 0.1 Accounts payable and accrued liabilities (0.7) (0.1) Total 30.9 15.3 Redeemable noncontrolling interests in consolidated VREs (6.3) (6.0) JHG's net interest in consolidated VREs $ 24.6 $ 9.3 |
Investment Securities (Tables)
Investment Securities (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of investment securities | Our investment securities as of December 31, 2019 and 2018, are summarized as follows (in millions): December 31, December 31, 2019 2018 Seeded investment products: Consolidated VIEs $ 924.8 $ 282.7 Consolidated VREs 29.9 13.9 Unconsolidated VIEs and VREs 31.4 53.8 Separate accounts 60.8 71.6 Pooled investment funds 0.1 25.5 Total seeded investment products 1,047.0 447.5 Investments related to deferred compensation plans 125.9 120.3 Other investments 5.4 6.7 Total investment securities $ 1,178.3 $ 574.5 |
Schedule of net unrealized gains (losses) on trading securities | Net unrealized gains (losses) on investment securities held by us as of December 31, 2019, 2018 and 2017, are summarized as follows (in millions): Year ended December 31, 2019 2018 2017 Unrealized gains (losses) on investment securities held at period end $ (19.2) $ (40.6) $ 25.2 |
Schedule of net foreign currency translation gains (losses) on hedged seed investments denominated in foreign currencies and net gains (losses) associated with foreign currency forward contracts under net investment hedging | We recognized the following foreign currency translation gains (losses) on hedged seed investments denominated in currencies other than our functional currency and gains (losses) associated with foreign currency forward contracts under net investment hedge accounting for the years ended December 31, 2019, 2018 and 2017 (in millions): Year ended December 31, 2019 2018 2017 Foreign currency translation $ (1.1) $ (6.8) $ (3.2) Foreign currency forward contracts 1.1 6.8 3.2 Total $ — $ — $ — |
Schedule of investment gains (losses), net in Consolidated Statements of Comprehensive Income | Investment gains (losses), net on our Consolidated Statements of Comprehensive Income included the following for the years ended December 31, 2019, 2018 and 2017 (in millions): Year ended December 31, 2019 2018 2017 Seeded investment products and derivatives, net $ 20.7 $ (42.6) $ 4.0 Gain on sale of Volantis — — 10.2 Other 13.5 1.7 3.8 Investment gains (losses), net $ 34.2 $ (40.9) $ 18.0 |
Cash flows related to investment securities | Cash flows related to our investment securities for the years ended December 31, 2019, 2018 and 2017, are summarized as follows (in millions): Year ended December 31, 2019 2018 2017 Sales, Sales, Sales, Purchases settlements Purchases settlements Purchases settlements and and and and and and settlements maturities settlements maturities settlements maturities Investment securities $ (903.4) $ 582.6 $ (626.3) $ 697.1 $ (827.5) $ 976.4 |
Not Designated as Hedging Instrument | |
Schedule of derivative instruments | We were a party to the following derivative instruments as of December 31, 2019 and 2018 (in millions): Notional Value December 31, 2019 December 31, 2018 Futures $ 222.9 $ 147.1 Credit default swaps 143.0 133.2 Total return swaps 46.3 77.2 Foreign currency forward contracts 327.8 131.8 |
Seeded investment products | |
Schedule of derivative instruments | Our consolidated seeded investment products were party to the following derivative instruments as of December 31, 2019 and 2018 (in millions): Notional Value December 31, 2019 December 31, 2018 Futures $ 88.3 $ 267.8 Contracts for differences 15.5 8.7 Credit default swaps 0.1 6.2 Total return swaps 0.1 23.7 Interest rate swaps 19.4 61.5 Options 1.0 9.6 Swaptions — 8.3 Foreign currency forward contracts 167.5 154.9 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets | |
Summary of goodwill and intangible assets | The following tables present movements in our intangible assets and goodwill during the years ended December 31, 2019 and 2018 (in millions): December 31, Foreign December 31, 2018 Amortization Impairment translation Disposal 2019 Indefinite-lived intangible assets: Investment management agreements $ 2,495.5 $ — $ (18.0) $ 12.8 $ — $ 2,490.3 Trademarks 380.8 — — — — 380.8 Definite-lived intangible assets: — Client relationships 363.3 — — 1.4 — 364.7 Accumulated amortization (116.3) (29.3) — (1.6) — (147.2) Net intangible assets $ 3,123.3 $ (29.3) $ (18.0) $ 12.6 $ — $ 3,088.6 Goodwill $ 1,478.0 $ — $ — $ 26.3 $ — $ 1,504.3 December 31, Foreign December 31, 2017 Amortization Impairment translation Disposal 2018 Indefinite-lived intangible assets: Investment management agreements $ 2,543.9 $ — $ (7.2) $ (41.2) $ — $ 2,495.5 Trademarks 381.2 — — (0.4) — 380.8 Definite-lived intangible assets: Client relationships 369.4 — — (6.1) — 363.3 Accumulated amortization (89.7) (29.5) — 2.9 — (116.3) Net intangible assets $ 3,204.8 $ (29.5) $ (7.2) $ (44.8) $ — $ 3,123.3 Goodwill $ 1,533.9 $ — $ — $ (46.4) $ (9.5) $ 1,478.0 |
Schedule of expected future amortization | Expected future amortization expense related to definite-lived intangible assets is summarized below (in millions): Future amortization Amount 2020 $ 29.4 2021 26.5 2022 18.0 2023 17.8 2024 16.4 Thereafter 109.4 Total $ 217.5 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Leases | |
Schedule of operating and financing lease assets and liabilities | Operating and financing lease assets and liabilities on our Consolidated Balance Sheets as of December 31, 2019, consisted of the following (in millions): Operating lease right-of-use assets: December 31, 2019 Other non-current assets $ 132.6 Operating lease liabilities: Accounts payable and accrued liabilities $ 24.9 Other non-current liabilities 129.4 Total operating lease liabilities $ 154.3 Finance lease right-of-use assets: Property and equipment, cost $ 13.0 Accumulated depreciation (12.2) Property and equipment, net $ 0.8 Finance lease liabilities Accounts payable and accrued liabilities $ 0.8 Other non-current liabilities 0.1 Total finance lease liabilities $ 0.9 |
Schedule of components of lease expense | The components of lease expense on our Consolidated Statements of Comprehensive Income for the year ended December 31, 2019, are summarized below (in millions): Year ended December 31, 2019 Operating lease cost (1) $ 33.7 Finance lease cost: Amortization of right-of-use asset (2) $ 1.1 Interest on lease liabilities (3) — Total finance lease cost $ 1.1 (1) Included in general, administrative and occupancy on our Consolidated Statements of Comprehensive Income. (2) Included in depreciation and amortization on our Consolidated Statements of Comprehensive Income. (3) Included in interest expense on our Consolidated Statements of Comprehensive Income. |
Schedule of cash flow statement | Cash payments for operating and finance leases included in our Consolidated Statements of Cash Flows for the year ended December 31, 2019, consisted of the following (in millions): Year ended December 31, 2019 Operating cash flows from operating leases $ 28.9 Financing cash flows from finance leases $ 1.1 |
Schedule of supplemental information | Weighted-average remaining lease term (in months): December 31, 2019 Operating leases 80 Finance leases 15 Weighted-average discount rate (1) : December 31, 2019 Operating leases 4.6% Finance leases 2.8% |
Schedule of future minimum payments under noncancelable operating leases | Future lease obligations (in millions) Operating leases Finance leases 2020 $ 31.1 $ 0.7 2021 29.8 0.1 2022 25.5 0.1 2023 23.6 — 2024 22.4 — Thereafter 48.8 — Total lease payments 181.2 0.9 Less interest 26.9 — Total $ 154.3 $ 0.9 |
Schedule of future minimum payments under noncancelable finance leases | Future lease obligations (in millions) Operating leases Finance leases 2020 $ 31.1 $ 0.7 2021 29.8 0.1 2022 25.5 0.1 2023 23.6 — 2024 22.4 — Thereafter 48.8 — Total lease payments 181.2 0.9 Less interest 26.9 — Total $ 154.3 $ 0.9 |
Equity Method Investments (Tabl
Equity Method Investments (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Equity Method Investments | |
Summary of Equity Method Investments | Country of incorporation 2019 2018 and principal Functional percentage percentage place of operation currency owned owned Long Tail Alpha USA USD 20 % 20 % |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Measurements | |
Schedule of assets, liabilities and redeemable noncontrolling interests presented in the financial statements or disclosed in the notes to the financial statements at fair value on a recurring basis | The following table presents assets and liabilities in our consolidated financial statements or disclosed in the notes to our consolidated financial statements at fair value on a recurring basis as of December 31, 2019 (in millions): Fair value measurements using: Quoted prices in active markets for identical assets Significant other Significant and liabilities observable inputs unobservable inputs (Level 1) (Level 2) (Level 3) Total Assets: Cash equivalents $ 198.4 $ — $ — $ 198.4 Investment securities: Consolidated VIEs 573.9 341.0 9.9 924.8 Other investment securities 197.0 56.5 — 253.5 Total investment securities 770.9 397.5 9.9 1,178.3 Seed hedge derivatives — 0.7 — 0.7 Volantis contingent consideration — — 2.9 2.9 Total assets $ 969.3 $ 398.2 $ 12.8 $ 1,380.3 Liabilities: Derivatives in consolidated seeded investment products $ — $ 0.9 $ — $ 0.9 Securities sold, not yet purchased 26.5 — — 26.5 Seed hedge derivatives — 8.7 — 8.7 Long-term debt (1) — 330.0 — 330.0 Deferred bonuses — — 76.6 76.6 Contingent consideration — — 21.2 21.2 Total liabilities $ 26.5 $ 339.6 $ 97.8 $ 463.9 (1) Carried at amortized cost on our Consolidated Balance Sheets and disclosed at fair value. The following table presents assets and liabilities in our consolidated financial statements or disclosed in the notes to the consolidated financial statements at fair value on a recurring basis as of December 31, 2018 (in millions): Fair value measurements using: Quoted prices in active markets for identical assets Significant other Significant and liabilities observable inputs unobservable inputs (Level 1) (Level 2) (Level 3) Total Assets: Cash equivalents $ 381.8 $ — $ — $ 381.8 Investment securities: Consolidated VIEs 103.8 159.7 19.2 282.7 Other investment securities 194.5 97.3 — 291.8 Total investment securities 298.3 257.0 19.2 574.5 Seed hedge derivatives — 3.2 — 3.2 Derivatives in consolidated seeded investment products — 0.9 — 0.9 Contingent consideration — — 3.9 3.9 Total assets $ 680.1 $ 261.1 $ 23.1 $ 964.3 Liabilities: Derivatives in consolidated seeded investment products $ — $ 2.1 $ — $ 2.1 Financial liabilities in consolidated seeded investment products 0.4 — — 0.4 Seed hedge derivatives — 1.1 — 1.1 Long-term debt (1) — 301.4 — 301.4 Deferred bonuses — — 68.5 68.5 Contingent consideration — — 61.3 61.3 Total liabilities $ 0.4 $ 304.6 $ 129.8 $ 434.8 (1) Carried at amortized cost on our Consolidated Balance Sheets and disclosed at fair value. |
Summary of valuation techniques and significant unobservable inputs used in the valuation of the company's private equity investments | Valuation techniques and significant unobservable inputs used in the valuation of our material Level 3 assets included within consolidated VIEs as of December 31, 2019 and 2018, were as follows (in millions): Significant Fair Valuation unobservable As of December 31, 2019 value technique inputs Inputs Investment securities of consolidated VIEs $ 9.9 Discounted Discount rate 15% cash flow EBITDA multiple 5.92 Price-earnings ratio 11.09 Significant Fair Valuation unobservable Range As of December 31, 2018 value technique inputs (weighted-average) Investment securities of consolidated VIEs $ 19.2 Discounted Discount rate 15% cash flow EBITDA multiple 18.5 Price-earnings ratio 28.4 |
Schedule of maximum amount payable and fair value of Geneva, Perennial, Kapstream and VelocityShares contingent consideration | The maximum amount payable and fair value of Geneva and Kapstream contingent consideration is summarized below (in millions): As of December 31, 2019 Geneva Kapstream Maximum amount payable $ 52.2 $ 14.4 Fair value included in: Accounts payable and accrued liabilities $ — $ 14.3 Other non-current liabilities 6.9 — Total fair value $ 6.9 $ 14.3 As of December 31, 2018 Geneva Kapstream Fair value included in: Accounts payable and accrued liabilities $ — $ 13.8 Other non-current liabilities 25.3 12.3 Total fair value $ 25.3 $ 26.1 |
Schedule of changes in fair value of the recurring Level 3 fair value measurements for collective items | Changes in fair value of our Level 3 assets for the years ended December 31, 2019 and 2018 were as follows (in millions): Year ended December 31, 2019 2018 Beginning of period fair value $ 23.1 $ 46.5 Disposals — (7.6) Settlements (2.3) (5.9) Movement recognized in net income (8.2) (9.5) Movements recognized in other comprehensive income 0.2 (0.4) End of period fair value $ 12.8 $ 23.1 |
Schedule of changes in fair value of the recurring Level 3 fair value measurements for individual items | Changes in fair value of our individual Level 3 liabilities for the years ended December 31, 2019 and 2018,were as follows (in millions): Year ended December 31, 2019 2018 Contingent Deferred Contingent Deferred Dai-ichi consideration bonuses consideration bonuses option Beginning of period fair value $ 61.3 $ 68.5 $ 76.6 $ 64.7 $ 26.1 Fair value adjustments (20.0) 7.5 11.2 (0.4) (26.8) Vesting of deferred bonuses — (52.3) — (44.8) — Amortization of deferred bonuses — 49.6 — 53.7 — Unrealized gains (losses) 6.7 — — — — Distributions (26.6) — (22.8) — — Foreign currency translation (0.2) 3.3 (3.7) (4.7) 0.7 End of period fair value $ 21.2 $ 76.6 $ 61.3 $ 68.5 $ — |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Debt | |
Components of debt | Our debt as of December 31, 2019 and 2018, consisted of the following (in millions): December 31, 2019 December 31, 2018 Carrying Fair Carrying Fair value value value value 4.875% Senior Notes due 2025 $ 316.2 $ 330.0 $ 319.1 $ 301.4 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Taxes | |
Schedule of provision for income taxes | The components of our provision for income taxes for the years ended December 31, 2019, 2018 and 2017, are as follows (in millions): Year ended December 31, 2019 2018 2017 Current: UK $ 23.6 $ 48.8 $ 51.5 U.S. including state and local 110.7 116.7 83.1 International 8.2 7.2 10.0 Total current income taxes 142.5 172.7 144.6 Deferred: UK (0.4) (3.1) 0.3 U.S. including state and local (2.2) (6.6) (354.4) International (2.1) (0.8) (1.5) Total deferred income taxes (benefits) (4.7) (10.5) (355.6) Total income tax expense (benefit) $ 137.8 $ 162.2 $ (211.0) |
Schedule of components of income before taxes and equity earnings | The components of our total income before taxes for the years ended December 31, 2019, 2018 and 2017, are as follows (in millions): Year ended December 31, 2019 2018 2017 UK $ 80.1 $ 178.3 $ 229.0 U.S. 445.3 467.4 190.5 International 58.1 16.1 27.9 Total income before taxes $ 583.5 $ 661.8 $ 447.4 |
Schedule of differences between effective income tax rate and statutory federal income tax rate | Year ended December 31, 2019 2018 2017 UK statutory corporation tax rate 19.0 % 19.0 % 19.3 % Effect of foreign tax rates 4.4 3.9 7.4 Equity-based compensation 1.1 0.3 0.2 Finalization of positions with HMRC (1) — — 0.3 Tax adjustments 0.2 0.3 0.7 Non-deductible costs associated with the Merger — — 1.2 Impact of changes in statutory tax rates on deferred taxes — 0.1 (77.4) Taxes applicable to prior years (0.5) (1.2) (0.4) Other, net — 1.4 1.7 Effective income tax rate, controlling interest 24.2 % 23.8 % (47.0) % Net income attributable to noncontrolling interests (0.6) 0.7 (0.1) Total effective income tax rate 23.6 % 24.5 % (47.1) % (1) Her Majesty’s Revenue and Customs (“HMRC”), tax authority of the UK. |
Schedule of Significant components of deferred tax assets and liabilities | The significant components of our deferred tax assets and liabilities as of December 31, 2019 and 2018, are as follows (in millions): December 31, 2019 2018 Deferred tax assets: Compensation and staff benefits $ 63.0 $ 60.8 Loss carryforwards (1) 59.9 55.9 Accrued liabilities 2.8 3.1 Debt premium 4.6 5.4 Lease liabilities 27.1 — Other 16.9 11.8 Gross deferred tax assets 174.3 137.0 Valuation allowance (56.1) (55.6) Deferred tax assets, net of valuation allowance $ 118.2 $ 81.4 Deferred tax liabilities: Retirement benefits $ (24.9) $ (23.9) Goodwill and acquired intangible assets (790.0) (783.9) Lease right-of-use assets (25.8) — Other (4.8) (3.5) Gross deferred tax liabilities (845.5) (811.3) Total deferred tax (liabilities) (2) $ (727.3) $ (729.9) (1) The majority of this loss carryforward relates to the UK capital loss of $298.0 million, before tax effects, which may be carried forward without time limitation. There is a full valuation allowance against UK capital losses. (2) The change in the net deferred tax liabilities does not equal the deferred tax expense due to the FX adjustment on deferred tax liabilities booked through equity. |
Schedule of balance sheet classification of deferred income tax assets and liabilities | Deferred tax assets and liabilities that relate to the same jurisdiction are recorded net on our Consolidated Balance Sheets as non-current balances and as of December 31, 2019 and 2018, are as follows (in millions): December 31, 2019 2018 Deferred tax assets, net (included in other non-current assets) $ 1.8 $ — Deferred tax liabilities, net (729.1) (729.9) Total deferred tax (liabilities) $ (727.3) $ (729.9) |
Reconciliation of beginning and ending tax contingencies liability | A reconciliation of the beginning and ending liability for the years ended December 31, 2019, 2018 and 2017, is as follows (in millions): Year ended December 31, 2019 2018 2017 Beginning balance $ 12.4 $ 10.2 $ 2.5 Balance acquired from the Merger — — 5.0 Additions for tax positions of current year — 2.2 3.4 Additions/(reduction) for tax positions of prior years 3.5 1.4 0.8 Reduction due to settlement with taxing authorities — (0.5) (0.9) Reduction due to statute expirations (1.9) (0.7) (0.9) Foreign currency translation 0.1 (0.2) 0.3 Ending balance $ 14.1 $ 12.4 $ 10.2 |
Other Financial Statement Cap_2
Other Financial Statement Captions (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Other Financial Statement Captions | |
Other current assets | Other current assets on our Consolidated Balance Sheets at December 31, 2019 and 2018, are composed of the following (in millions): December 31, 2019 2018 Prepaid expenses $ 27.4 $ 22.6 Current corporation tax 9.5 4.3 Derivatives (including short sale assets) 26.0 3.2 Other current assets 53.1 39.3 Total other current assets $ 116.0 $ 69.4 |
Accounts payable and accrued liabilities | Accounts payable and accrued liabilities on our Consolidated Balance Sheets at December 31, 2019 and 2018, comprise the following (in millions): December 31, 2019 2018 Accrued distribution commissions $ 50.8 $ 42.2 Accrued rebates 28.5 30.2 Other accrued liabilities 52.5 84.7 Total other accrued liabilities $ 131.8 $ 157.1 Current corporation tax (including interest) 12.6 28.0 Leases 25.7 1.1 Contingent consideration 14.3 13.8 Derivatives (including short sale liabilities) 35.3 1.1 Other current liabilities 26.3 32.1 Total accounts payable and accrued liabilities $ 246.0 $ 233.2 |
Other non-current liabilities | Other non-current liabilities on our Consolidated Balance Sheets at December 31, 2019 and 2018, comprise the following (in millions): December 31, 2019 2018 Non-current tax liabilities (including interest) $ 14.9 $ 10.6 Leases 129.5 — Other creditors 7.5 10.3 Contingent consideration 6.9 47.5 Other non-current accrued liabilities — 10.8 Total other non-current liabilities $ 158.8 $ 79.2 |
Noncontrolling Interests (Table
Noncontrolling Interests (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Noncontrolling Interests | |
Summary of redeemable noncontrolling interests | Redeemable noncontrolling interests as of December 31, 2019 and 2018, consisted of the following (in millions): December 31, 2019 2018 Consolidated seeded investment products $ 662.8 $ 121.6 Intech: Appreciation rights 11.8 10.9 Founding member ownership interests 3.3 3.6 Total redeemable noncontrolling interests $ 677.9 $ 136.1 |
Schedule of movement in redeemable noncontrolling interests in consolidated seeded investment products | The following table presents the movement in redeemable noncontrolling interests in consolidated seeded investment products for the years ended December 31, 2019, 2018 and 2017 (in millions): Year ended December 31, 2019 2018 2017 Opening balance $ 121.6 $ 174.9 $ 158.0 Balance acquired from the Merger — — 23.2 Changes in market value 18.9 (15.5) (9.8) Changes in ownership 509.7 (36.3) 3.7 Foreign currency translation 12.6 (1.5) (0.2) Closing balance $ 662.8 $ 121.6 $ 174.9 |
Summary of nonredeemable noncontrolling interests | Nonredeemable noncontrolling interests as of December 31, 2019 and 2018, are as follows (in millions): December 31, 2019 2018 Nonredeemable noncontrolling interests in: Seed capital investments $ 6.7 $ 8.3 Intech 13.0 13.2 Total nonredeemable noncontrolling interests $ 19.7 $ 21.5 |
Long-Term Incentive Compensat_2
Long-Term Incentive Compensation (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of long term incentive plan weighting | 2015 and 2016 awards criteria (pre- Merger) Weighting Market conditions FTSE 350 25 % ASX 100 25 % Non-market Net fund flows condition 15 % Investment performance condition 15 % Operating margin condition 15 % People strategy condition 10 % 2015 and 2016 awards criteria (post-Merger) Weighting Market conditions Relative TSR 50 % Non-market Relative investment performance 25 % Relative net income before tax growth 25 % |
Schedule of assumptions used for fair value of stock options granted | At December 31, 2019, unrecognized and unearned compensation, based on expected vesting outcomes as of December 31, 2019, on the 2016 LTIP, and the weighted-average number of years over which the compensation cost will be recognized are summarized as follows (in millions): Weighted- Unrecognized average compensation years DEP $ 13.5 1.4 LTIP 0.1 0.2 RSP 6.8 1.6 BAYE 0.4 0.5 ExSOP 0.1 0.2 CSOP 0.1 0.2 SAYE 0.7 2.0 RSA 37.9 1.7 Stock-based payments expense 59.6 1.6 DEP Funds - liability settled 28.8 1.3 MFSA - liability settled 30.1 2.1 Profits interests and other 14.4 4.5 Social Security costs 19.1 0.9 Total remaining charge to the Consolidated Statements of Comprehensive Income $ 152.0 1.8 |
Summary of outstanding options | Black-Scholes Option Pricing Model Year ended December 31, 2019 2018 2017 SAYE SAYE CSOP U.S. CSOP ExSOP SAYE Fair value of options granted £ 2.15 £ 4.99 33.43 p 32.81 p 27.78 p 75.28 p Assumptions: Dividend yield 6.92 % 3.85 % 4.64 % 4.64 % 4.64 % 3.99 % Expected volatility 30.17 % 32.20 % 32.41 % 35.19 % 32.41 % 32.13 % Risk-free interest rate 0.55 % 0.70 % 0.27 % 0.16 % 0.27 % 0.19 % Expected life (years) 3 3 3 2 3 3 Monte Carlo Model – LTIP 2015 Year ended December 31, 2019 % Allocation of award Tranche 1 Tranche 2 Fair Values: Relative TSR 50 % 118.96 p 124.11 p Relative investment performance 25 % 209.76 p 206.59 p Relative net income before tax growth 25 % 209.76 p 206.59 p Assumptions: Date of grant May 1, 2015 May 1, 2015 Start of performance period January 1, 2015 January 1, 2015 End of performance period December 31, 2017 December 31, 2018 Vesting date May 1, 2018 May 1, 2019 Date of modification ("DoM") May 30, 2017 May 30, 2017 Share price at DoM 233.7 p 233.7 p Risk free discount rate 0.1 % pa 0.1 % pa Dividend yield 4.5 % pa 4.5 % pa Share price volatility in GBP 30 % pa 30 % pa Holding period adjustment 9.0 % 6.2 % Percentage based on pre-modification performance conditions 80 % 60 % Monte Carlo Model – LTIP 2016 Year Ended December 31, 2019 % Allocation of award Tranche 1 Tranche 2 Fair values: Relative TSR 50 % 120.98 p 123.64 p Relative investment performance 25 % 200.42 p 197.39 p Relative net income before tax growth 25 % 200.42 p 197.39 p Assumptions: Date of grant May 24, 2016 May 24, 2016 Start of performance period January 1, 2016 January 1, 2016 End of performance period December 31, 2018 December 31, 2019 Vesting date March 24, 2019 March 24, 2020 Date of modification ("DoM") May 30, 2017 May 30, 2017 Share price at DoM 233.7 p 233.7 p Risk free discount rate 0.1 % pa 0.1 % pa Dividend yield 4.5 % pa 4.5 % pa Share price volatility in GBP 30 % pa 30 % pa Holding period adjustment 9.0 % 6.2 % Expected volatility was determined using an average of historical volatility. Expected life was determined using the vesting periods of each grant. The risk-free interest rate for periods within the contractual life of the options is based on the UK Treasury three-year coupon rate and two-year coupon rate, respectively, at grant date. The table below summarizes our outstanding options, exercisable options and options vested or expected to vest for the years ended December 31, 2019, 2018 and 2017: 2019 2018 2017 Weighted- Weighted- Weighted- average average average Shares price Shares price Shares price Outstanding at January 1 3,139,762 $ 27.91 4,319,706 $ 22.55 45,560,242 $ 1.97 Share consolidation — $ — — $ — (41,004,619) $ 19.82 Acquired from Merger — $ — — $ — 92,949 $ 18.76 Granted 244,336 $ 18.84 84,273 $ 26.88 2,042,321 $ 13.66 Exercised (325,134) $ 5.43 (212,562) $ 12.31 (404,735) $ 20.32 Forfeited (1,185,037) $ 28.30 (1,051,655) $ 11.81 (1,966,452) $ 7.41 Outstanding at December 31 1,873,927 $ 28.41 3,139,762 $ 27.91 4,319,706 $ 22.55 Exercisable (1) 91,099 $ — 707,848 $ 33.75 5,014,642 $ 34.67 Vested or expected to vest 962,064 $ 32.97 1,157,663 $ 1.51 2,999,811 $ 15.57 Included in the above table are our nil cost LTIP options, which constitute the majority of forfeitures. (1) The number of exercisable options represents instruments for which all vesting criteria have been satisfied and whose exercise price was below the closing price of our common stock as of the end of the period. |
Summary of intrinsic value of exercised, outstanding and exercisable options | The following table summarizes the intrinsic value of exercised, outstanding and exercisable options at December 31, 2019, 2018 and 2017 (in millions): December 31, 2019 2018 2017 Exercised $ 0.4 $ 0.1 $ 2.8 Outstanding $ 1.0 $ 0.2 $ 15.9 Exercisable $ 0.3 $ 0.2 $ 3.9 |
LongTerm Incentive Plan | |
Components of long-term incentive compensation expense | Compensation Expense The components of our long-term incentive compensation expense for the years ended December 31, 2019, 2018 and 2017, are summarized as follows (in millions): Year ended December 31, 2019 2018 2017 DEP $ 19.1 $ 18.7 $ 17.6 LTIP 1.3 2.6 6.4 RSP 8.3 10.1 3.4 BAYE 2.1 3.0 3.2 ExSOP 0.3 0.8 1.5 CSOP 0.3 0.6 1.1 SAYE 0.1 0.9 0.8 RSA (including PVUs) 42.2 44.9 32.8 ESOP — — — Stock-based payments expense 73.7 81.6 66.8 DEP Funds - liability settled 57.5 54.9 41.4 MFSA - liability settled 46.2 24.3 20.7 Profits interests and other (3.9) 18.4 12.3 Social Security costs 10.8 9.4 10.3 Total charge to the Consolidated Statements of Comprehensive Income $ 184.3 $ 188.6 $ 151.5 |
Deferred Equity Plan | |
Summary of unvested stock awards | 2019 2018 2017 Weighted- Weighted- Weighted- average average average Shares price Shares price Shares price Outstanding at January 1 1,738,776 $ 33.41 1,442,091 $ 32.36 16,466,630 $ 3.17 Share consolidation — $ — — $ — (14,825,509) $ 31.64 Adjustment — $ — — $ — 1,275 $ 15.43 Granted 1,403,472 $ 23.63 1,129,504 $ 33.55 919,967 $ 31.40 Vested (828,953) $ 31.44 (731,596) $ 33.80 (873,810) $ 31.33 Forfeited (193,345) $ 28.42 (101,223) $ 33.07 (246,462) $ 28.06 Unvested at December 31 2,119,950 $ 26.98 1,738,776 $ 33.41 1,442,091 $ 32.36 |
Appreciation Rights October 2014 | |
Summary of assumptions used for fair value of appreciation rights of INTECH long-term incentive awards | Assumptions October 2014 February 2015 March 2016 grant grant grant Dividend yield 1.98 % 2.56 % 2.89 % Expected volatility 34 % 30 % 28 % Risk-free interest rate 2.53 % 1.81 % 1.93 % Expected life (in years) 12 6 6 Grant date fair value (in millions) $ 23.2 $ 2.0 $ 2.6 Merger date fair value (in millions) $ 13.3 $ 0.9 $ 1.8 |
Restricted Stock Awards | |
Summary of unvested stock awards | 2019 2018 2017 Weighted- Weighted- Weighted- average average average Shares price Shares price Shares price Outstanding at January 1 3,378,150 $ 32.35 3,537,221 $ 30.81 4,068,619 $ 30.72 Granted 1,395,824 $ 24.37 1,107,382 $ 35.57 73,982 $ 35.08 Vested (1,238,185) $ 31.92 (1,197,671) $ 30.76 (444,884) $ 30.73 Forfeited (138,819) $ 30.72 (68,782) $ 32.49 (160,496) $ 30.72 Unvested at December 31 3,396,970 $ 29.30 3,378,150 $ 32.35 3,537,221 $ 30.81 |
Retirement Benefit Plans (Table
Retirement Benefit Plans (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Retirement Benefit Plans | |
Schedule of plans assets and benefit obligations | Our plan assets, benefit obligations and funded status as of the December 31 measurement date were as follows (in millions): December 31, 2019 2018 Change in plan assets: Fair value of plan assets as of January 1 $ 849.5 $ 941.8 Return on plan assets 100.1 (11.1) Employer contributions 2.0 12.5 Benefits paid (14.8) (14.7) Settlements (25.4) (24.0) Foreign currency translation 34.5 (55.0) Fair value of plan assets as of December 31 945.9 849.5 Change in benefit obligation: Benefit obligation as of January 1 (613.3) (719.1) Service cost (0.8) (1.2) Interest cost (17.4) (17.3) Settlements 25.4 24.0 Plan amendments — (3.9) Benefits paid 14.8 14.7 Actuarial gain (loss) (86.8) 47.6 Foreign currency translation (25.1) 41.9 Benefit obligation as of December 31 (703.2) (613.3) Funded status as of year-end 242.7 236.2 Tax at source (33.1) (33.4) Net retirement benefit asset recognized in the Consolidated Balance Sheets $ 209.6 $ 202.8 |
Schedule of retirement benefit asset recognized in the Consolidated Balance Sheets | Amounts recognized on our Consolidated Balance Sheet, net of tax at source as of December 31, 2019 and 2018, consist of the following (in millions): December 31, 2019 2018 Retirement benefit assets recognized in the Consolidated Balance Sheets: Janus Henderson Group UK Pension Scheme $ 214.0 $ 206.5 Retirement benefit obligations recognized in the Consolidated Balance Sheets: Janus Henderson Group unapproved pension scheme (4.4) (3.7) Net retirement benefit asset recognized in the Consolidated Balance Sheets $ 209.6 $ 202.8 |
Schedule of key assumptions used in determining the defined benefit obligation | December 31, 2019 2018 Discount rate 2.1 % 2.9 % Inflation - salaries 2.5 % 2.5 % Inflation - Retail Price Index ("RPI") 3.0 % 3.1 % Inflation - Consumer Price Index ("CPI") 1.9 % 2.0 % Pension increases (RPI capped at 5% per annum ("p.a.")) 2.9 % 3.0 % Pension increases (RPI capped at 2.5% p.a.) 2.0 % 2.1 % Life expectancy of male aged 60 at accounting date 28.3 28.2 Life expectancy of male aged 60 in 15 years time 29.3 29.2 |
Schedule of fair values of the JHGPS plan assets | The fair values of the JHGPS plan assets as of December 31, 2019 and 2018, by major asset class, are as follows (in millions): December 31, 2019 2018 Cash and cash equivalents $ 3.7 $ 6.4 Money market instruments 78.1 21.6 Forward foreign exchange contracts — 0.3 Bulk annuity policy 395.8 — Fixed income investments 261.4 623.2 Equity investments 206.9 198.0 Total assets at fair value $ 945.9 $ 849.5 |
Schedule of plan assets at fair value on a recurring basis | The following table presents JHGPS plan assets at fair value on a recurring basis as of December 31, 2019 (in millions): Fair value measurements using: Quoted prices in active markets for and liabilities Significant other Significant identical assets observable inputs unobservable inputs (Level 1) (Level 2) (Level 3) Total Cash and cash equivalents $ 3.7 $ — $ — $ 3.7 Money market instruments — 78.1 — 78.1 Bulk annuity contract — — 395.8 395.8 Fixed income investments 261.4 — — 261.4 Equity investments 206.9 — — 206.9 Total $ 472.0 $ 78.1 $ 395.8 $ 945.9 The following table presents JHGPS plan assets at fair value on a recurring basis as of December 31, 2018 (in millions): Fair value measurements using: Quoted prices in active markets for and liabilities Significant other Significant identical assets observable inputs unobservable inputs (Level 1) (Level 2) (Level 3) Total Cash and cash equivalents $ 6.4 $ — $ — $ 6.4 Money market instruments — 21.6 — 21.6 Forward foreign exchange contracts 0.3 — — 0.3 Fixed income investments 619.0 4.2 — 623.2 Equity investments — 198.0 — 198.0 Total $ 625.7 $ 223.8 $ — $ 849.5 |
Schedule of actuarial gains and losses | Cumulative amounts recognized in accumulated other comprehensive income and the actuarial gain, net of tax deducted at source, credited to other comprehensive income for the years ended December 31, 2019 and 2018, are shown below (in millions): December 31, 2019 2018 Opening accumulated unamortized actuarial gain $ 24.7 $ 21.0 Current year actuarial gain (loss) (5.5) 14.4 Tax at source on current year actuarial gain (loss) 0.9 (6.5) Current year prior service cost 0.4 (3.7) Release of actuarial gain due to settlement event (2.1) (1.1) Release of tax at source due to settlement event 0.7 0.6 Closing accumulated unamortized actuarial gain $ 19.1 $ 24.7 |
Schedule of components of net periodic benefit credit | The components of net periodic benefit cost in respect of defined benefit plans for the years ended December 31, 2019, 2018 and 2017, include the following (in millions): December 31, 2019 2018 2017 Service cost $ (0.8) $ (1.2) $ (1.2) Settlement gain 2.1 1.6 1.6 Interest cost (17.4) (17.3) (19.2) Amortization of prior service cost (0.4) — — Expected return on plan assets 18.6 21.3 20.3 Net periodic benefit credit 2.1 4.4 1.5 Contributions to money purchase section (7.9) (8.0) (7.4) Total cost $ (5.8) $ (3.6) $ (5.9) |
Schedule of key assumptions used in determining the net periodic benefit cost | The following key assumptions were used in determining the net periodic benefit cost for the years ended December 31, 2019, 2018 and 2017 (in millions): December 31, 2019 2018 2017 Discount rate 2.9 % 2.6 % 2.9 % Inflation — salaries 2.5 % 2.5 % 2.5 % Inflation — RPI 3.1 % 3.1 % 3.2 % Inflation — CPI 2.0 % 2.0 % 2.1 % Pension increases (RPI capped at 5% p.a.) 3.0 % 3.0 % 3.0 % Pension increases (RPI capped at 2.5% p.a.) 2.1 % 2.1 % 2.1 % Expected return on plan assets 2.5 % 2.5 % 2.6 % Amortization period for net actuarial gains at beginning of the year 10.0 11.0 11.0 |
Schedule of expected future cash flows | The expected future benefit payments for our pension plan are as follows (in millions): 2020 $ 22.9 2021 $ 20.1 2022 $ 22.0 2023 $ 23.7 2024 $ 25.0 2025-2029 $ 131.1 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Loss (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Accumulated Other Comprehensive Loss | |
Schedule of the changes in accumulated other comprehensive loss, net of tax | Changes in accumulated other comprehensive loss, net of tax for the years ended December 31, 2019 and 2018, are as follows (in millions): Year ended December 31, 2019 2018 Foreign Retirement benefit Foreign Retirement currency asset, net Total currency asset, net Total Beginning balance $ (448.2) $ 24.7 $ (423.5) $ (325.3) $ 21.0 $ (304.3) Other comprehensive income (loss) 74.7 (5.6) 69.1 (124.3) 3.7 (120.6) Less: other comprehensive loss (income) attributable to noncontrolling interests (12.7) — (12.7) 1.4 — 1.4 Ending balance $ (386.2) $ 19.1 $ (367.1) $ (448.2) $ 24.7 $ (423.5) |
Components of other comprehensive income (loss), net of tax | The components of other comprehensive income (loss), net of tax for the years ended December 31, 2019, 2018 and 2017, are as follows (in millions): Pre-tax Tax Year ended December 31, 2019 amount expense Net amount Foreign currency translation adjustments $ 74.3 $ 0.4 $ 74.7 Retirement benefit asset, net (4.1) (0.1) (4.2) Reclassifications to net income (1.4) — (1.4) Total other comprehensive loss $ 68.8 $ 0.3 $ 69.1 Pre-tax Tax Year ended December 31, 2018 amount benefit Net amount Foreign currency translation adjustments $ (124.3) $ — $ (124.3) Retirement benefit asset, net 4.2 0.6 4.8 Reclassifications to net income (1.1) — (1.1) Total other comprehensive income $ (121.2) $ 0.6 $ (120.6) Pre-tax Tax Year ended December 31, 2017 amount expense Net amount Net unrealized losses on available-for-sale securities $ 1.9 $ — $ 1.9 Foreign currency translation adjustments 125.0 — 125.0 Retirement benefit asset, net (10.2) (0.4) (10.6) Reclassifications to net income (4.4) — (4.4) Total other comprehensive income loss $ 112.3 $ (0.4) $ 111.9 |
Earnings and Dividends Per Sh_2
Earnings and Dividends Per Share (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Earnings and Dividends Per Share | |
Summary of earnings per share calculation | The following is a summary of the earnings per share calculation for the years ended December 31, 2019, 2018 and 2017 (in millions, except per share data): Year ended December 31, 2019 2018 2017 Net income attributable to JHG $ 427.6 $ 523.8 $ 655.5 Less: Allocation of earnings to participating stock-based awards (11.7) (12.7) (17.3) Net income attributable to JHG common shareholders $ 415.9 $ 511.1 $ 638.2 Weighted-average common shares outstanding — basic 188.0 195.0 160.7 Dilutive effect of non-participating stock-based awards 0.6 0.9 1.6 Weighted-average common shares outstanding — diluted 188.6 195.9 162.3 Earnings per share: Basic (two class) $ 2.21 $ 2.62 $ 3.97 Diluted (two class) $ 2.21 $ 2.61 $ 3.93 |
Schedule of anti-dilutive securities that have not been included in the calculation of weighted average diluted shares outstanding | The following instruments are anti-dilutive and have not been included in the weighted-average diluted shares outstanding calculation (in millions): Year ended December 31, 2019 2018 2017 Unvested nonparticipating stock awards 1.1 1.0 0.8 Dai-ichi options — — 10.0 |
Schedule of cash dividends declared and paid | Year ended December 31, 2019 2018 2017 Dividends paid per share — pre-Merger — in GBP £ — £ — £ 0.0915 Dividends paid per share — post-Merger — in USD $ 1.4400 $ 1.4000 $ 0.6400 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Transactions | |
Schedule of related party activity | As of December 31 2019 2018 Accrued income $ 198.2 $ 187.2 Accounts receivable 34.0 29.7 |
Geographic Information (Tables)
Geographic Information (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Geographic Information | |
Summary information of entity's geographic areas | The following summary provides information concerning our principal geographic areas for the years ended and as of December 31, 2019, 2018 and 2017 (in millions): Year ended December 31, Operating revenues 2019 2018 2017 U.S. $ 1,353.0 $ 1,338.7 $ 818.1 UK 602.4 649.4 669.0 Luxembourg 182.3 255.9 280.9 International 54.7 62.4 50.3 Total $ 2,192.4 $ 2,306.4 $ 1,818.3 As of December 31, Long-lived assets 2019 2018 UK $ 384.8 $ 366.8 U.S. 2,569.4 2,604.2 Australia 216.1 219.3 Other 3.0 2.5 Total $ 3,173.3 $ 3,192.8 |
Selected Quarterly Financial _2
Selected Quarterly Financial Data (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Selected Quarterly Financial Data | |
Selected Quarterly Financial Data | 2019 First Second Third Fourth (in millions, except per share amounts) quarter quarter quarter quarter Full year Total revenue $ 519.3 $ 535.9 $ 536.0 $ 601.2 $ 2,192.4 Operating income 124.5 118.5 143.6 154.3 540.9 Net income 99.9 112.3 113.1 120.4 445.7 Net income attributable to noncontrolling interests (5.8) (2.9) (1.0) (8.4) (18.1) Net income attributable to JHG 94.1 109.4 112.1 112.0 427.6 Basic earnings per share attributable to JHG common shareholders $ 0.48 $ 0.56 $ 0.58 $ 0.59 $ 2.21 Diluted earnings per share attributable to JHG common shareholders $ 0.48 $ 0.56 $ 0.58 $ 0.59 $ 2.21 2018 First Second Third Fourth (in millions, except per share amounts) quarter quarter quarter quarter Full year Total revenue $ 587.7 $ 592.4 $ 581.2 $ 545.1 $ 2,306.4 Operating income 176.2 175.3 148.3 150.0 649.8 Net income 163.2 130.5 105.1 100.8 499.6 Net income attributable to noncontrolling interests 2.0 10.1 6.1 6.0 24.2 Net income attributable to JHG 165.2 140.6 111.2 106.8 523.8 Basic earnings per share attributable to JHG common shareholders $ 0.82 $ 0.70 $ 0.55 $ 0.54 $ 2.62 Diluted earnings per share attributable to JHG common shareholders $ 0.82 $ 0.70 $ 0.55 $ 0.54 $ 2.61 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Consolidation, Property, Equipment and Software, Deferred Commissions (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Property, Equipment and Software | |||
Depreciation and amortization expense | $ 23.5 | $ 24.7 | $ 24.6 |
Property, equipment and software, gross | 157.2 | 132.2 | |
Accumulated depreciation | (72.5) | (62.7) | |
Property, equipment and software, net | 84.7 | 69.5 | |
Impairments of long-lived assets | $ 0 | 0 | $ 0 |
Deferred Commissions | |||
Amortization period of sales commission, maximum | 4 years | ||
Furniture, fixtures and computer equipment | |||
Property, Equipment and Software | |||
Property, equipment and software, gross | $ 36.1 | 31.3 | |
Furniture, fixtures and computer equipment | Minimum | |||
Property, Equipment and Software | |||
Depreciation period | 3 years | ||
Furniture, fixtures and computer equipment | Maximum | |||
Property, Equipment and Software | |||
Depreciation period | 10 years | ||
Leasehold improvements | |||
Property, Equipment and Software | |||
The years shorter of or the period of the lease to determine depreciation period | 20 years | ||
Property, equipment and software, gross | $ 38 | 35.3 | |
Computer software | |||
Property, Equipment and Software | |||
Property, equipment and software, gross | $ 83.1 | $ 65.6 | |
Computer software | Minimum | |||
Property, Equipment and Software | |||
Depreciation period | 3 years | ||
Computer software | Maximum | |||
Property, Equipment and Software | |||
Depreciation period | 7 years |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Financial Instruments (Details) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||||||||
Dec. 31, 2019USD ($) | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($)$ / shares | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2019USD ($)item | Dec. 31, 2018USD ($)$ / shares | Dec. 31, 2017USD ($) | Dec. 31, 2019£ / shares | Dec. 31, 2019$ / shares | May 30, 2017$ / shares | May 03, 2017$ / shares | Apr. 26, 2017£ / shares | Apr. 26, 2017$ / shares | |
Financial Instruments | |||||||||||||||||
Employer contributions to deferred compensation plan | $ 0 | $ 0 | $ 0 | ||||||||||||||
Trade and other receivables, payment terms (in days) | 30 days | ||||||||||||||||
Revenue Recognition | |||||||||||||||||
Total revenue | $ 601.2 | $ 536 | $ 535.9 | $ 519.3 | $ 545.1 | $ 581.2 | $ 592.4 | $ 587.7 | $ 2,192.4 | $ 2,306.4 | $ 1,818.3 | ||||||
Changes in Equity | |||||||||||||||||
Common Stock, Par or Stated Value Per Share | (per share) | $ 1.50 | $ 1.50 | £ 1.50 | $ 1.50 | $ 1.50 | $ 0.15 | £ 0.125 | $ 0.1547 | |||||||||
Mutual funds | |||||||||||||||||
Revenue Recognition | |||||||||||||||||
Number of components involved in investment advisory fee payment | item | 2 | ||||||||||||||||
Performance fee adjustment, ultimate measurement period | 36 months | ||||||||||||||||
Minimum | Mutual funds | |||||||||||||||||
Revenue Recognition | |||||||||||||||||
Performance fee adjustment, base measurement period | 12 months | ||||||||||||||||
Maximum | Mutual funds | |||||||||||||||||
Revenue Recognition | |||||||||||||||||
Performance fee adjustment, variable rate | 0.15% | ||||||||||||||||
Performance fee adjustment, base measurement period | 18 months |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Stock Based Compensation, Common Stock (Details) $ / shares in Units, $ in Millions | May 30, 2017$ / shares | May 03, 2017USD ($)$ / shares | Apr. 26, 2017USD ($)$ / sharesshares | Dec. 31, 2019USD ($)item$ / sharesshares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017USD ($) | Dec. 31, 2019£ / shares | Apr. 26, 2017£ / shares | Apr. 25, 2017USD ($) |
Basis of Presentation | |||||||||
Stock-based compensation costs | $ 74.2 | $ 82.4 | $ 67.4 | ||||||
Proceeds from stock-based compensation plans | $ 8.6 | 6 | |||||||
Goodwill and Intangible Assets, Net | |||||||||
Number of reporting unit for goodwill impairment testing purposes | item | 1 | ||||||||
Gain or loss recognized on purchase, issue, sale or cancellation of Henderson's own equity shares | $ 0 | ||||||||
Common stock, par (in dollars per share) | (per share) | $ 1.50 | $ 0.15 | $ 0.1547 | $ 1.50 | $ 1.50 | £ 1.50 | £ 0.125 | ||
Common stock, shares issued | shares | 1,131,842,110 | 186,975,693 | 196,412,764 | ||||||
Ordinary share capital amount | $ 169.8 | $ 175.1 | $ 280.5 | $ 294.6 | $ 234.4 | ||||
Additional paid-in-capital | 1,302.5 | $ 1,297.2 | 3,828.5 | 3,824.5 | $ 1,237.9 | ||||
Reduction in ordinary share capital amount due change in par value | $ 5.3 | ||||||||
Ordinary shares split conversion ratio | 1 | 10 | |||||||
Retained earnings | |||||||||
Basis of Presentation | |||||||||
Stock-based compensation costs | 0 | 0 | 9.9 | ||||||
Proceeds from stock-based compensation plans | 0 | 0 | $ 0 | ||||||
Accumulated stock-based compensation costs | $ 0 | $ 0 | |||||||
Client relationships | |||||||||
Goodwill and Intangible Assets, Net | |||||||||
Estimated useful life (in years) | 13 years |
Recent Accounting Pronounceme_2
Recent Accounting Pronouncements (Details) - Accounting Standards Update 2016-02 $ in Millions | Jan. 01, 2019USD ($) |
Recent Accounting Pronouncements | |
Right of use assets | $ 129.8 |
Lease liability | $ 146.4 |
Acquisitions and Dispositions -
Acquisitions and Dispositions - Merger with JCG (Details) $ / shares in Units, shares in Millions, $ in Millions | May 30, 2017USD ($)$ / sharesshares | Apr. 26, 2017$ / shares | Dec. 31, 2019USD ($)$ / shares | Dec. 31, 2019£ / shares | Dec. 31, 2018USD ($)$ / shares | Dec. 31, 2017USD ($) | May 03, 2017$ / shares | Apr. 26, 2017£ / shares |
Acquisitions | ||||||||
Par value ( in dollars per share) | (per share) | $ 1.50 | $ 0.1547 | $ 1.50 | £ 1.50 | $ 1.50 | $ 0.15 | £ 0.125 | |
Ordinary shares split conversion ratio | 1 | 10 | ||||||
Assets: | ||||||||
Intangible assets | $ 29.5 | |||||||
Goodwill | $ 1,504.3 | $ 1,478 | $ 1,533.9 | |||||
Janus Capital Group Inc | ||||||||
Acquisitions | ||||||||
Consideration transferred | $ 2,630.2 | |||||||
Number of shares issued to common stock holders of Janus Capital Group | shares | 87.2 | |||||||
Share price of common stock issued to stock holders of Janus Capital Group (in dollars per share) | $ / shares | $ 30.75 |
Acquisitions and Dispositions_2
Acquisitions and Dispositions - Merger with JCG - Pro Forma Results of Operations (Details) - USD ($) $ in Millions | 7 Months Ended | 12 Months Ended |
Dec. 31, 2017 | Dec. 31, 2017 | |
Pro Forma Results of Operations | ||
Revenue | $ 2,182.6 | |
Net income attributable to JHG | $ 704.6 | |
JCG's results of operations | ||
Revenues included in JHG's Condensed Consolidated Statements of Comprehensive Income | $ 752.9 | |
Net income attributable to JCG | $ 354 |
Consolidation - VIEs (Details)
Consolidation - VIEs (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Investment securities | $ 253.5 | $ 291.8 |
Unconsolidated VIEs | ||
Investment securities | $ 9.9 | $ 3.1 |
Consolidation - VREs (Details)
Consolidation - VREs (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Investment securities | $ 253.5 | $ 291.8 |
Other current assets | 116 | 69.4 |
Accounts payable and accrued liabilities | (246) | (233.2) |
Consolidated VREs | ||
Investment securities | 29.9 | 13.9 |
Cash and cash equivalents | 1.5 | 1.4 |
Other current assets | 0.2 | 0.1 |
Accounts payable and accrued liabilities | (0.7) | (0.1) |
Total | 30.9 | 15.3 |
Redeemable noncontrolling interests in consolidated VREs | (6.3) | (6) |
JHG's net interest in consolidated VREs | 24.6 | 9.3 |
Unconsolidated VREs | ||
Investment securities | $ 21.5 | $ 50.7 |
Investment Securities - General
Investment Securities - General Disclosure (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Short-term investments: | |||
Estimated Fair Value | $ 1,178.3 | $ 574.5 | |
Assets | |||
Derivative assets | 0.7 | ||
Liabilities | |||
Derivative liabilities | 8.7 | ||
Net gains (losses) in net income related to: | |||
Foreign currency translation | (1.1) | (6.8) | $ (3.2) |
Foreign currency forward contracts | 1.1 | 6.8 | 3.2 |
Securities sold, not yet purchased | 26.5 | ||
Indefinite-Lived Intangible Assets | 381.2 | ||
Seeded investment products | |||
Short-term investments: | |||
Seeded investment products | 1,047 | 447.5 | |
Investment securities | Seeded investment products | |||
Short-term investments: | |||
Unrealized gains (losses) on investment securities held at period end | (19.2) | (40.6) | $ 25.2 |
Investment securities | Separate accounts | |||
Short-term investments: | |||
Seeded investment products | 60.8 | 71.6 | |
Investment securities | Pooled investment funds | |||
Short-term investments: | |||
Seeded investment products | 0.1 | 25.5 | |
Investment securities | Investments related to deferred compensation plans | |||
Short-term investments: | |||
Estimated Fair Value | 125.9 | 120.3 | |
Investment securities | Other investments | |||
Short-term investments: | |||
Seeded investment products | 5.4 | 6.7 | |
Consolidated VIEs | Investment securities | |||
Short-term investments: | |||
Seeded investment products | 924.8 | 282.7 | |
Consolidated VREs | Investment securities | |||
Short-term investments: | |||
Seeded investment products | 29.9 | 13.9 | |
Unconsolidated VIEs and VREs | Investment securities | |||
Short-term investments: | |||
Seeded investment products | 31.4 | 53.8 | |
Consolidated | Credit default swap, selling protection contracts | Seeded investment products | |||
Short-term investments: | |||
Notional value of derivative | 2.2 | 3.9 | |
Futures | Derivative Instruments | Not Designated as Hedging Instrument | |||
Short-term investments: | |||
Notional value of derivative | 222.9 | 147.1 | |
Futures | Derivative Instruments | Seeded investment products | |||
Short-term investments: | |||
Notional value of derivative | 88.3 | 267.8 | |
Credit default swaps | Derivative Instruments | Not Designated as Hedging Instrument | |||
Short-term investments: | |||
Notional value of derivative | 143 | 133.2 | |
Credit default swaps | Derivative Instruments | Seeded investment products | |||
Short-term investments: | |||
Notional value of derivative | 0.1 | 6.2 | |
Total return swaps | Derivative Instruments | Not Designated as Hedging Instrument | |||
Short-term investments: | |||
Notional value of derivative | 46.3 | 77.2 | |
Total return swaps | Derivative Instruments | Seeded investment products | |||
Short-term investments: | |||
Notional value of derivative | 0.1 | 23.7 | |
Foreign currency forward contracts | Derivative Instruments | Not Designated as Hedging Instrument | |||
Short-term investments: | |||
Notional value of derivative | 327.8 | 131.8 | |
Foreign currency forward contracts | Derivative Instruments | Seeded investment products | |||
Short-term investments: | |||
Notional value of derivative | $ 167.5 | $ 154.9 |
Investment Securities - Offsett
Investment Securities - Offsetting Derivatives (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Assets | |||
Derivative Asset | $ 0.7 | ||
Liabilities | |||
Derivative liabilities | 8.7 | ||
Derivative Instrument Denominated in Foreign Currency | |||
Investment gains (losses), net | 34.2 | $ (40.9) | $ 18 |
Cash flows related to investment securities | |||
Purchases and settlements | 1.5 | 35.1 | 7.5 |
Seeded investment products | |||
Derivative Instrument Denominated in Foreign Currency | |||
Investment gains (losses), net | 20.7 | (42.6) | 4 |
Seeded investment products | Consolidated | Credit default swap, selling protection contracts | |||
Seeded investment products, credit protection | |||
Notional value of derivative | 2.2 | 3.9 | |
Fair value of credit default swap contracts | $ 0 | $ 0.1 | |
Seeded investment products | Consolidated | Credit default swap, selling protection contracts | Minimum | |||
Seeded investment products, credit protection | |||
Term of credit default swap contracts (in years) | 1 year | 1 year | |
Seeded investment products | Consolidated | Credit default swap, selling protection contracts | Maximum | |||
Seeded investment products, credit protection | |||
Term of credit default swap contracts (in years) | 5 years | 5 years | |
Gain on sale of Volantis | |||
Derivative Instrument Denominated in Foreign Currency | |||
Investment gains (losses), net | 10.2 | ||
Other investments | |||
Derivative Instrument Denominated in Foreign Currency | |||
Investment gains (losses), net | $ 13.5 | $ 1.7 | 3.8 |
Investment securities | |||
Cash flows related to investment securities | |||
Purchases and settlements | (903.4) | (626.3) | (827.5) |
Sales, settlements and maturities | 582.6 | 697.1 | $ 976.4 |
Derivative Instruments | Seeded investment products | Futures | |||
Seeded investment products, credit protection | |||
Notional value of derivative | 88.3 | 267.8 | |
Derivative Instruments | Seeded investment products | Contracts for differences | |||
Seeded investment products, credit protection | |||
Notional value of derivative | 15.5 | 8.7 | |
Derivative Instruments | Seeded investment products | Interest rate swaps | |||
Seeded investment products, credit protection | |||
Notional value of derivative | 19.4 | 61.5 | |
Derivative Instruments | Seeded investment products | Total return swaps | |||
Seeded investment products, credit protection | |||
Notional value of derivative | 0.1 | 23.7 | |
Derivative Instruments | Seeded investment products | Credit default swaps | |||
Seeded investment products, credit protection | |||
Notional value of derivative | 0.1 | 6.2 | |
Derivative Instruments | Seeded investment products | Options | |||
Seeded investment products, credit protection | |||
Notional value of derivative | 1 | 9.6 | |
Derivative Instruments | Seeded investment products | Swaptions | |||
Seeded investment products, credit protection | |||
Notional value of derivative | 8.3 | ||
Derivative Instruments | Seeded investment products | Foreign currency forward contracts | |||
Seeded investment products, credit protection | |||
Notional value of derivative | $ 167.5 | $ 154.9 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets (Details) $ in Millions | Mar. 31, 2018USD ($)employee | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2019USD ($) | Oct. 01, 2019USD ($) | Sep. 30, 2019USD ($) | Dec. 31, 2018USD ($) |
Indefinite-lived intangible assets: | |||||||
Balance at the beginning of the period | $ 381.2 | ||||||
Impairment | $ (18) | (7.2) | |||||
Foreign currency translation | (0.4) | ||||||
Definite-lived intangible assets: | |||||||
Impairment | 0 | ||||||
Accumulated amortization, balance at the beginning of the period | (116.3) | (89.7) | |||||
Amortization | (29.3) | (29.5) | |||||
Foreign currency translation | (1.6) | (2.9) | |||||
Accumulated amortization, balance at the end of the period | (147.2) | (116.3) | |||||
Net intangible assets | |||||||
Net intangible assets, balance at the beginning of the period | 3,123.3 | 3,204.8 | |||||
Merger | $ (29.5) | ||||||
Amortization | (29.3) | (29.5) | |||||
Impairment | (18) | ||||||
Foreign currency translation | 12.6 | 44.8 | |||||
Net intangible assets, balance at the end of the period | 3,088.6 | 3,123.3 | |||||
Goodwill | |||||||
Goodwill, balance at the beginning of the period | 1,478 | 1,533.9 | |||||
Foreign currency translation | 26.3 | (46.4) | |||||
Disposal | (9.5) | ||||||
Goodwill, balance at the end of the period | 1,504.3 | 1,478 | |||||
The amount of fair value greater than carrying value for goodwill and intangible assets | $ 0.3 | ||||||
Indefinite-Lived Intangible Assets | 381.2 | ||||||
Impairment | 18 | 7.2 | |||||
Transaction with BNP Paribas | |||||||
Allocated goodwill | 9.5 | ||||||
Disposal | (9.5) | ||||||
Future Amortization: | |||||||
2020 | $ 29.4 | ||||||
2021 | 26.5 | ||||||
2022 | 18 | ||||||
2023 | 17.8 | ||||||
2024 | 16.4 | ||||||
Thereafter | 109.4 | ||||||
Total | 217.5 | ||||||
JHG's Back Office | |||||||
Goodwill | |||||||
Disposal | $ (9.5) | ||||||
Transaction with BNP Paribas | |||||||
Consideration for discontinued operations | 40 | ||||||
Allocated goodwill | 9.5 | ||||||
Disposal | $ (9.5) | ||||||
JHG's Back Office | Minimum | |||||||
Transaction with BNP Paribas | |||||||
Number of employees transitioned | employee | 100 | ||||||
Other non-operating income (expenses), net | JHG's Back Office | |||||||
Transaction with BNP Paribas | |||||||
Gain on discontinued operations | $ 22.3 | ||||||
Client relationships | |||||||
Definite-lived intangible assets: | |||||||
Balance at the beginning of the period | 363.3 | 369.4 | |||||
Foreign currency translation | 1.4 | (6.1) | |||||
Balance at the end of the period | $ 364.7 | 363.3 | |||||
Estimated life | 13 years | ||||||
Investment management agreements | |||||||
Indefinite-lived intangible assets: | |||||||
Balance at the beginning of the period | $ 2,495.5 | 2,543.9 | |||||
Impairment | (18) | ||||||
Foreign currency translation | 12.8 | (41.2) | |||||
Balance at the end of the period | 2,490.3 | 2,495.5 | |||||
Goodwill | |||||||
Indefinite-Lived Intangible Assets | 2,495.5 | 2,495.5 | 2,490.3 | $ 167.6 | 2,495.5 | ||
Impairment | 18 | ||||||
Certain indefinite-lived Intangible Assets | |||||||
Indefinite-lived intangible assets: | |||||||
Balance at the beginning of the period | 150 | ||||||
Impairment | (18) | ||||||
Balance at the end of the period | 132 | 150 | |||||
Goodwill | |||||||
Indefinite-Lived Intangible Assets | 132 | 150 | 132 | 150 | |||
Impairment | 18 | ||||||
Gartmore investment management agreements | |||||||
Net intangible assets | |||||||
Impairment | (7.2) | ||||||
Trademarks | |||||||
Indefinite-lived intangible assets: | |||||||
Balance at the beginning of the period | 380.8 | ||||||
Balance at the end of the period | 380.8 | 380.8 | |||||
Goodwill | |||||||
Indefinite-Lived Intangible Assets | $ 380.8 | $ 380.8 | $ 380.8 | $ 380.8 |
Leases (Details)
Leases (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Leases | |
Option to extend - Operating | true |
Option to extend - Finance | true |
Option to terminate - Operating | true |
Option to terminate - Finance | true |
Minimum | |
Leases | |
Remaining lease term | 1 year |
Maximum | |
Leases | |
Remaining lease term | 10 years |
Leases - Balance Sheet (Details
Leases - Balance Sheet (Details) $ in Millions | Dec. 31, 2019USD ($) |
Leases | |
Operating lease right-of-use assets | $ 132.6 |
Financial position | us-gaap:OtherAssetsNoncurrent |
Operating lease liabilities - current | $ 24.9 |
Financial position | us-gaap:AccountsPayableAndAccruedLiabilitiesCurrent |
Operating lease liabilities - noncurrent | $ 129.4 |
Financial position | us-gaap:OtherLiabilitiesNoncurrent |
Total Operating lease liabilities | $ 154.3 |
Property and equipment, at cost | 13 |
Accumulated depreciation | (12.2) |
Finance lease right-of-use assets | $ 0.8 |
Financial position | us-gaap:PropertyPlantAndEquipmentNet |
Finance lease liabilities - current | $ 0.8 |
Financial position | us-gaap:AccountsPayableAndAccruedLiabilitiesCurrent |
Finance lease liabilities - noncurrent | $ 0.1 |
Financial position | us-gaap:OtherLiabilitiesNoncurrent |
Total Finance lease liabilities | $ 0.9 |
Leases - Statement of Comprehen
Leases - Statement of Comprehensive Income (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Components of lease cost: | |
Operating lease cost | $ 33.7 |
Amortization of right-of-use asset | 1.1 |
Total finance lease cost | 1.1 |
Sublease income | 7.3 |
Impairment loss | 4.7 |
UK | |
Components of lease cost: | |
Impairment loss | 4.7 |
U.S. | |
Components of lease cost: | |
Impairment loss | $ 0.7 |
Leases - Cash Flow Statement (D
Leases - Cash Flow Statement (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Leases | |||
Operating cash flows from operating leases | $ 28.9 | ||
Financing cash flows from finance leases | 1.1 | $ 1.3 | $ 0.9 |
Non-cash recognition of ROU asset | $ 19.8 | ||
Term of lease that has not yet commenced | 11 years | ||
Future rent obligation of operating least that has not yet commenced | $ 8.4 |
Leases - Supplemental Informati
Leases - Supplemental Information (Details) | Dec. 31, 2019 |
Leases | |
Operating leases -Weighted-average remaining lease term (in months) | 80 months |
Finance leases - Weighted-average remaining lease term (in months) | 15 months |
Operating leases - Weighted-average discount rate | 0.046% |
Finance leases - Weighted-average discount rate | 0.028% |
Leases - Future lease obligatio
Leases - Future lease obligations (Details) $ in Millions | Dec. 31, 2019USD ($) |
Operating leases | |
2020 | $ 31.1 |
2021 | 29.8 |
2022 | 25.5 |
2023 | 23.6 |
2024 | 22.4 |
Thereafter | 48.8 |
Total lease payments | 181.2 |
Less interest | 26.9 |
Total | 154.3 |
Finance leases | |
2020 | 0.7 |
2021 | 0.1 |
2022 | 0.1 |
Total lease payments | 0.9 |
Total | $ 0.9 |
Equity Method Investments (Deta
Equity Method Investments (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Equity Method Investments | |||
Net gain (loss) from equity method investments | $ 1.5 | $ 2 | |
Net gain (loss) from equity method investments | $ 0.6 | ||
Other non-current assets | |||
Equity Method Investments | |||
Equity method investments | $ 8.8 | $ 7.8 | |
Long Tail Alpha | |||
Equity Method Investments | |||
Percentage owned | 20.00% | 20.00% |
Fair Value Measurements - Level
Fair Value Measurements - Level of Fair Value (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Assets | ||||
Total investment securities | $ 253.5 | $ 291.8 | ||
Derivative assets | 0.7 | |||
Liabilities | ||||
Derivative liabilities | 8.7 | |||
Securities sold, not yet purchased | 26.5 | |||
Total redeemable noncontrolling interests | 677.9 | 136.1 | ||
Seeded investment products | ||||
Liabilities | ||||
Total redeemable noncontrolling interests | 662.8 | 121.6 | $ 174.9 | $ 158 |
Unconsolidated VIEs | ||||
Assets | ||||
Total investment securities | 9.9 | 3.1 | ||
Intech Founders | ||||
Liabilities | ||||
Total redeemable noncontrolling interests | 3.3 | 3.6 | ||
Consolidated | Seeded investment products | ||||
Liabilities | ||||
Total redeemable noncontrolling interests | 662.8 | 121.6 | ||
Consolidated VIEs | ||||
Assets | ||||
Total investment securities | 924.8 | 282.7 | ||
Fair value measurements, recurring | ||||
Assets | ||||
Cash equivalents | 198.4 | 381.8 | ||
Contingent consideration | 2.9 | 3.9 | ||
Total assets | 1,380.3 | 964.3 | ||
Liabilities | ||||
Securities sold, not yet purchased | 26.5 | |||
Long-term debt | 330 | 301.4 | ||
Contingent consideration | 21.2 | 61.3 | ||
Total liabilities | 463.9 | 434.8 | ||
Fair value measurements, recurring | Deferred bonuses | ||||
Liabilities | ||||
Derivative liabilities | 76.6 | 68.5 | ||
Fair value measurements, recurring | Investment securities | ||||
Assets | ||||
Total investment securities | 1,178.3 | 574.5 | ||
Fair value measurements, recurring | Seed hedge derivatives | ||||
Assets | ||||
Derivative assets | 0.7 | 3.2 | ||
Liabilities | ||||
Derivative liabilities | 8.7 | 1.1 | ||
Fair value measurements, recurring | Level 1 | ||||
Assets | ||||
Cash equivalents | 198.4 | 381.8 | ||
Total assets | 969.3 | 680.1 | ||
Liabilities | ||||
Securities sold, not yet purchased | 26.5 | |||
Total liabilities | 26.5 | 0.4 | ||
Fair value measurements, recurring | Level 1 | Investment securities | ||||
Assets | ||||
Total investment securities | 770.9 | 298.3 | ||
Fair value measurements, recurring | Level 2 | ||||
Assets | ||||
Total assets | 398.2 | 261.1 | ||
Liabilities | ||||
Long-term debt | 330 | 301.4 | ||
Total liabilities | 339.6 | 304.6 | ||
Fair value measurements, recurring | Level 2 | Investment securities | ||||
Assets | ||||
Total investment securities | 397.5 | 257 | ||
Fair value measurements, recurring | Level 2 | Seed hedge derivatives | ||||
Assets | ||||
Derivative assets | 0.7 | 3.2 | ||
Liabilities | ||||
Derivative liabilities | 8.7 | 1.1 | ||
Fair value measurements, recurring | Level 3 | ||||
Assets | ||||
Total investment securities | 9.9 | 19.2 | ||
Contingent consideration | 2.9 | 3.9 | ||
Total assets | 12.8 | 23.1 | ||
Liabilities | ||||
Contingent consideration | 21.2 | 61.3 | ||
Total liabilities | 97.8 | 129.8 | ||
Fair value measurements, recurring | Level 3 | Deferred bonuses | ||||
Liabilities | ||||
Derivative liabilities | 76.6 | 68.5 | ||
Fair value measurements, recurring | Level 3 | Investment securities | ||||
Assets | ||||
Total investment securities | 9.9 | 19.2 | ||
Fair value measurements, recurring | Unconsolidated VIEs | Investment securities | ||||
Assets | ||||
Total investment securities | 253.5 | 291.8 | ||
Fair value measurements, recurring | Unconsolidated VIEs | Level 1 | Investment securities | ||||
Assets | ||||
Total investment securities | 197 | 194.5 | ||
Fair value measurements, recurring | Unconsolidated VIEs | Level 2 | Investment securities | ||||
Assets | ||||
Total investment securities | 56.5 | 97.3 | ||
Fair value measurements, recurring | Consolidated | Seeded investment products | ||||
Assets | ||||
Derivative assets | 0.9 | |||
Liabilities | ||||
Derivative liabilities | 0.9 | 2.1 | ||
Financial liabilities in consolidated seeded investment products | 0.4 | |||
Fair value measurements, recurring | Consolidated | Level 1 | Seeded investment products | ||||
Liabilities | ||||
Financial liabilities in consolidated seeded investment products | 0.4 | |||
Fair value measurements, recurring | Consolidated | Level 2 | Seeded investment products | ||||
Assets | ||||
Derivative assets | 0.9 | |||
Liabilities | ||||
Derivative liabilities | 0.9 | 2.1 | ||
Fair value measurements, recurring | Consolidated VIEs | Investment securities | ||||
Assets | ||||
Total investment securities | 924.8 | 282.7 | ||
Fair value measurements, recurring | Consolidated VIEs | Level 1 | Investment securities | ||||
Assets | ||||
Total investment securities | 573.9 | 103.8 | ||
Fair value measurements, recurring | Consolidated VIEs | Level 2 | Investment securities | ||||
Assets | ||||
Total investment securities | 341 | 159.7 | ||
Fair value measurements, recurring | Consolidated VIEs | Level 3 | Investment securities | ||||
Assets | ||||
Total investment securities | $ 9.9 | $ 19.2 |
Fair Value Measurements - Dispo
Fair Value Measurements - Disposal of Volantis (Details) - Volantis - USD ($) $ in Millions | Apr. 01, 2017 | Dec. 31, 2019 | Dec. 31, 2018 |
Disposal of Volantis | |||
Period of performance of investee for recognizing consideration | 3 years | ||
Discontinued Operations, Disposed of by Sale | |||
Disposal of Volantis | |||
Percentage of share for consideration of sale | 0.10% | ||
Fair value of contingent consideration | $ 2.9 | $ 3.9 | |
Revenue forecasting period | 3 years | ||
Business Combination, Contingent Consideration, Asset | $ 2.9 | $ 3.9 |
Fair Value Measurements - Acqui
Fair Value Measurements - Acquisition of Geneva (Details) $ in Millions | 12 Months Ended | |
Dec. 31, 2019USD ($) | Dec. 31, 2014tranche | |
Acquisitions | ||
Contingent consideration fair value adjustment | $ (20) | |
Increase in contingency liability due to unwind of discount | (20) | |
Geneva | ||
Acquisitions | ||
Number of contingent consideration payment tranches | tranche | 2 | |
Contingent consideration payable period | 6 years | |
Geneva | Other non-operating income (expenses), net | ||
Acquisitions | ||
Contingent consideration fair value adjustment | 20 | |
Increase in contingency liability due to unwind of discount | $ 20 |
Fair Value Measurements - Conti
Fair Value Measurements - Contingent Consideration (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Fair value included in: | ||
Accounts payable and accrued liabilities | $ 14.3 | $ 13.8 |
Other non-current liabilities | 6.9 | 47.5 |
Geneva | ||
Contingent Consideration | ||
Maximum amount payable | 52.2 | |
Fair value included in: | ||
Other non-current liabilities | 6.9 | 25.3 |
Total fair value | 6.9 | 25.3 |
Kapstream | ||
Contingent Consideration | ||
Maximum amount payable | 14.4 | |
Fair value included in: | ||
Accounts payable and accrued liabilities | 14.3 | 13.8 |
Other non-current liabilities | 12.3 | |
Total fair value | $ 14.3 | $ 26.1 |
Fair Value Measurements - Acq_2
Fair Value Measurements - Acquisition of Kapstream (Details) $ in Millions | 1 Months Ended | 12 Months Ended | ||||
Feb. 26, 2020USD ($) | Feb. 28, 2019USD ($) | Feb. 28, 2018USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Jan. 31, 2017USD ($)item | |
Business acquisition | ||||||
Contingent consideration fair value adjustment | $ (20) | |||||
Kapstream | ||||||
Business acquisition | ||||||
Ownership interest acquired (as a percent) | 0.49% | |||||
Contingent cash consideration paid, for revenue target achieved | $ 13.8 | $ 14.1 | $ 15.3 | |||
Fair value of contingent consideration liability | 14.3 | $ 26.1 | ||||
Number of installments | item | 3 | |||||
Contingent consideration fair value adjustment | $ 0 | |||||
Kapstream | Maximum | ||||||
Business acquisition | ||||||
Fair value of contingent consideration liability | $ 43 |
Fair Value Measurements - Acq_3
Fair Value Measurements - Acquisition of Perennial (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended |
Oct. 31, 2019 | Dec. 31, 2019 | |
Acquisitions | ||
Contingent consideration fair value adjustment | $ (20) | |
Perennial | ||
Acquisitions | ||
Contingent cash consideration paid | $ 12.1 |
Fair Value Measurements - Acq_4
Fair Value Measurements - Acquisition of VelocityShares (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Business acquisition | |
Increase in contingency liability due to unwind of discount | $ (20) |
Fair Value Measurements - Lev_2
Fair Value Measurements - Level 3 Rollforward (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Changes in fair value | |||
Balance at the beginning of period, Liability Value | $ 23.1 | $ 46.5 | |
Foreign currency translation | (1.1) | (6.8) | $ (3.2) |
Balance at the end of period, Liability Value | 23.1 | 46.5 | |
Investment securities | 253.5 | 291.8 | |
Change in fair value of Level 3 assets | |||
Disposals | (7.6) | ||
Consolidated VIEs | |||
Changes in fair value | |||
Investment securities | 924.8 | 282.7 | |
Level 3 | Contingent consideration | |||
Changes in fair value | |||
Balance at the beginning of period, Liability Value | 61.3 | 76.6 | |
Fair value adjustments | (20) | 11.2 | |
Unrealized gains (losses) | 6.7 | ||
Distributions | (26.6) | (22.8) | |
Foreign currency translation | (0.2) | (3.7) | |
Balance at the end of period, Liability Value | 21.2 | 61.3 | 76.6 |
Level 3 | Deferred bonuses | |||
Changes in fair value | |||
Balance at the beginning of period, Liability Value | 68.5 | 64.7 | |
Fair value adjustments | 7.5 | (0.4) | |
Vesting of deferred bonuses | (52.3) | (44.8) | |
Amortization of deferred bonuses | 49.6 | 53.7 | |
Foreign currency translation | 3.3 | (4.7) | |
Balance at the end of period, Liability Value | 76.6 | 68.5 | $ 64.7 |
Level 3 | Dai-ichi options | |||
Changes in fair value | |||
Balance at the beginning of period, Liability Value | 26.1 | ||
Fair value adjustments | (26.8) | ||
Foreign currency translation | 0.7 | ||
Balance at the end of period, Liability Value | 26.1 | ||
Level 3 | Fair value measurements, recurring | |||
Changes in fair value | |||
Investment securities | 9.9 | 19.2 | |
Change in fair value of Level 3 assets | |||
Balance at the beginning of period, Asset value | 23.1 | ||
Settlements | (2.3) | (5.9) | |
Movements recognized in net income | (8.2) | (9.5) | |
Movements recognized in other comprehensive income | 0.2 | (0.4) | |
Balance at the end of period, Asset value | $ 12.8 | $ 23.1 | |
Level 3 | Fair value measurements, recurring | Discounted cash flow | |||
Changes in fair value | |||
Discount rate | 0.15 | 0.15 | |
EBITDA multiple | 5.92 | 0.185 | |
Price-earnings ratio | 11.09 | 0.284 |
Debt (Details)
Debt (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | May 30, 2017USD ($) | |
4.875% Senior Notes due 2025 | |||
Components of debt | |||
Interest rate (as a percent) | 4.875% | 4.875% | |
Other Disclosures | |||
Face value of debt issued | $ 300 | ||
4.875% Senior Notes due 2025 | Carrying value | |||
Components of debt | |||
Total debt | $ 316.2 | $ 319.1 | |
4.875% Senior Notes due 2025 | Fair value | |||
Components of debt | |||
Total debt | 330 | $ 301.4 | |
Credit Facility | |||
Other Disclosures | |||
Credit facility, maximum borrowing capacity | $ 200 | ||
Credit facility covenant terms, financing leverage ratio, maximum | 3 | ||
Borrowings under the Credit Facility | $ 0 | ||
Janus Capital Group Inc | 4.875% Senior Notes due 2025 | |||
Components of debt | |||
Interest rate (as a percent) | 4.875% | ||
Other Disclosures | |||
Unamortized premium, net | $ 16.2 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Current: | |||
Total Current income taxes | $ 142.5 | $ 172.7 | $ 144.6 |
Deferred: | |||
Total deferred income taxes/(benefits) | (4.7) | (10.5) | (355.6) |
Total income tax expense (benefit) | 137.8 | 162.2 | (211) |
Components of income before taxes | |||
Income before taxes | 583.5 | 661.8 | 447.4 |
UK | |||
Current: | |||
Non-US | 23.6 | 48.8 | 51.5 |
Deferred: | |||
Non-US | (0.4) | (3.1) | 0.3 |
Components of income before taxes | |||
Non-US | $ 80.1 | $ 178.3 | $ 229 |
Reconciliation between statutory rate and effective tax rate: | |||
statutory corporation tax rate (as a percentage) | 19.00% | 19.00% | 19.30% |
Effect of foreign tax rates (as a percentage) | 4.40% | 3.90% | 7.40% |
Equity-based compensation (as a percentage) | 1.10% | 0.30% | 0.20% |
Finalization of positions with HMRC (as a percentage) | 0.30% | ||
Tax adjustments (as a percentage) | 0.20% | 0.30% | 0.70% |
Non-deductible costs associated with the Merger (as a percentage) | 1.20% | ||
Impact of changes in statutory tax rates on deferred taxes (as a percentage) | 0.10% | (77.40%) | |
Taxes applicable to prior years (as a percentage) | (0.50%) | (1.20%) | (0.40%) |
Other, net (as a percentage) | 1.40% | 1.70% | |
Effective income tax rate, controlling interest (as a percentage) | 24.20% | 23.80% | (47.00%) |
Net income attributable to noncontrolling interests (as a percentage) | (0.60%) | 0.70% | (0.10%) |
Total effective income tax rate (as a percentage) | 23.60% | 24.50% | (47.10%) |
U.S. | |||
Current: | |||
U.S. including state and local | $ 110.7 | $ 116.7 | $ 83.1 |
Deferred: | |||
U.S. including state and local | (2.2) | (6.6) | (354.4) |
Components of income before taxes | |||
US | 445.3 | 467.4 | 190.5 |
International | |||
Current: | |||
Non-US | 8.2 | 7.2 | 10 |
Deferred: | |||
Non-US | (2.1) | (0.8) | (1.5) |
Components of income before taxes | |||
Non-US | $ 58.1 | $ 16.1 | $ 27.9 |
Income Taxes - Deferred Taxes (
Income Taxes - Deferred Taxes (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Deferred tax assets: | ||
Compensation and staff benefits | $ 63 | $ 60.8 |
Loss carryforwards | 59.9 | 55.9 |
Accrued liabilities | 2.8 | 3.1 |
Debt premium | 4.6 | 5.4 |
Lease liabilities | 27.1 | |
Other | 16.9 | 11.8 |
Gross deferred tax assets | 174.3 | 137 |
Valuation allowance | (56.1) | (55.6) |
Deferred tax assets, net of valuation allowance | 118.2 | 81.4 |
Deferred tax liabilities: | ||
Retirement benefits | (24.9) | (23.9) |
Goodwill and acquired intangible assets | (790) | (783.9) |
Lease right-of-use assets | (25.8) | |
Other | (4.8) | (3.5) |
Gross deferred tax liabilities | (845.5) | (811.3) |
Total deferred tax (liabilities) | (727.3) | (729.9) |
Deferred tax assets and liabilities reflected on the balance sheet | ||
Deferred tax liabilities, net | (729.1) | $ (729.9) |
Change in valuation allowance for deferred tax assets | 0.5 | |
UK | ||
Deferred tax assets: | ||
Loss carryforwards | 298 | |
Other non-current assets | ||
Deferred tax assets and liabilities reflected on the balance sheet | ||
Deferred tax assets, net (included in other non-current assets) | $ 1.8 |
Income Taxes - Unrecognized Tax
Income Taxes - Unrecognized Tax Benefits (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Reconciliation of beginning and ending liability: | |||
Balance at the beginning of the year | $ 12.4 | $ 10.2 | $ 2.5 |
Balance acquired from the Merger | 5 | ||
Additions for tax positions of current year | 2.2 | 3.4 | |
Additions/(reduction) for tax positions of prior years | 3.5 | 1.4 | 0.8 |
Reduction due to settlement with taxing authorities | (0.5) | (0.9) | |
Reduction due to statute expirations | (1.9) | (0.7) | (0.9) |
Foreign currency translation | 0.1 | 0.3 | |
Foreign currency translation | (0.2) | ||
Balance at the end of the year | 14.1 | 12.4 | 10.2 |
Accrued interest included in liability for income tax contingencies | 1.7 | $ 1.5 | $ 1.5 |
Anticipated decrease in income tax contingency reserves in the next 12 months | $ 0.2 |
Other Financial Statement Cap_3
Other Financial Statement Captions (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Other current assets | ||
Prepaid expenses | $ 27.4 | $ 22.6 |
Current corporation tax | 9.5 | 4.3 |
Derivatives | 26 | 3.2 |
Other current assets | 53.1 | 39.3 |
Total other current assets | 116 | 69.4 |
Other non-current assets | 149.3 | 15.5 |
Other accrued liabilities | ||
Accrued distribution commissions | 50.8 | 42.2 |
Accrued rebates | 28.5 | 30.2 |
Other accrued liabilities | 52.5 | 84.7 |
Total other accrued liabilities | 131.8 | 157.1 |
Accounts payable and accrued liabilities | ||
Current corporation tax (including interest) | 12.6 | 28 |
Leases | 25.7 | 1.1 |
Contingent consideration | 14.3 | 13.8 |
Derivatives | 35.3 | 1.1 |
Other current liabilities | 26.3 | 32.1 |
Total accounts payable and accrued liabilities | 246 | 233.2 |
Other non-current liabilities | ||
Non-current tax liabilities (including interest) | 14.9 | 10.6 |
Leases | 129.5 | |
Other creditors | 7.5 | 10.3 |
Contingent consideration | 6.9 | 47.5 |
Other non-current accrued liabilities | 10.8 | |
Total other non-current liabilities | $ 158.8 | $ 79.2 |
Other Financial Statement Cap_4
Other Financial Statement Captions - Leases (Details) | 12 Months Ended |
Dec. 31, 2019lease | |
Lease information | |
Number of operating leases | 2 |
Lancelot Place, London | |
Lease information | |
Further term of operating lease | 5 years |
Rex House, Queen Street, London | |
Lease information | |
Further term of operating lease | 8 years |
Noncontrolling Interests - Rede
Noncontrolling Interests - Redeemable (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2019 | |
Redeemable Noncontrolling Interests | ||||
Total redeemable noncontrolling interests | $ 136.1 | $ 136.1 | $ 677.9 | |
Roll forward of redeemable noncontrolling interests in consolidated seed investment products | ||||
Opening balance | 136.1 | |||
Closing balance | 677.9 | 136.1 | ||
Seeded investment products | ||||
Redeemable Noncontrolling Interests | ||||
Total redeemable noncontrolling interests | 121.6 | 121.6 | $ 158 | 662.8 |
Roll forward of redeemable noncontrolling interests in consolidated seed investment products | ||||
Opening balance | 121.6 | 174.9 | 158 | |
Balance acquired from the Merger | 23.2 | |||
Changes in market value | 18.9 | (15.5) | (9.8) | |
Changes in ownership | 509.7 | (36.3) | 3.7 | |
Foreign currency translation | 12.6 | (1.5) | (0.2) | |
Closing balance | 662.8 | 121.6 | $ 174.9 | |
Intech | ||||
Redeemable Noncontrolling Interests | ||||
INTECH appreciation rights | 11.8 | 10.9 | ||
Intech Founders | ||||
Redeemable Noncontrolling Interests | ||||
Total redeemable noncontrolling interests | 3.6 | 3.6 | $ 3.3 | |
Roll forward of redeemable noncontrolling interests in consolidated seed investment products | ||||
Opening balance | 3.6 | |||
Closing balance | 3.3 | 3.6 | ||
Remaining interest (as a percent) | 1.10% | |||
Consolidated | Seeded investment products | ||||
Redeemable Noncontrolling Interests | ||||
Total redeemable noncontrolling interests | 121.6 | 121.6 | $ 662.8 | |
Roll forward of redeemable noncontrolling interests in consolidated seed investment products | ||||
Opening balance | 121.6 | |||
Closing balance | $ 662.8 | $ 121.6 |
Noncontrolling Interests - Nonr
Noncontrolling Interests - Nonredeemable (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Nonredeemable noncontrolling interests | ||
Total nonredeemable noncontrolling interests | $ 19.7 | $ 21.5 |
Seeded investment products | ||
Nonredeemable noncontrolling interests | ||
Total nonredeemable noncontrolling interests | 6.7 | 8.3 |
Intech | ||
Nonredeemable noncontrolling interests | ||
Total nonredeemable noncontrolling interests | $ 13 | $ 13.2 |
Long-Term Incentive Compensat_3
Long-Term Incentive Compensation - (Details) | Feb. 28, 2019USD ($)shares | Feb. 28, 2018USD ($)shares | Dec. 31, 2016shares | Dec. 31, 2014shares | Oct. 23, 2014USD ($) | Mar. 31, 2016USD ($) | Feb. 28, 2015USD ($) | Oct. 31, 2014USD ($) | Dec. 31, 2019GBP (£)shares | Dec. 31, 2019USD ($)$ / sharesshares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017USD ($)$ / sharesshares | Dec. 31, 2017£ / shares | Dec. 31, 2016USD ($)shares | Dec. 31, 2015USD ($)shares | Dec. 31, 2014USD ($) |
Price-Vesting Units | ||||||||||||||||
Number of replacement awards shares granted to employees | 1,107,382 | |||||||||||||||
Number of price-vesting units vested | 1,197,671 | |||||||||||||||
INTECH Long-Term Incentive Awards | ||||||||||||||||
Weighted average price per share (in dollars per share) | $ / shares | $ 35.57 | |||||||||||||||
Deferred Equity Plan | ||||||||||||||||
Long-Term Incentive and Employee Compensation | ||||||||||||||||
Number of years awards are deferred | 3 years | 3 years | ||||||||||||||
Awards are vested in each year (as a percent) | 33.00% | 33.00% | ||||||||||||||
Price-Vesting Units | ||||||||||||||||
Number of replacement awards shares granted to employees | 1,403,472 | 1,403,472 | 1,129,504 | 919,967 | ||||||||||||
Number of price-vesting units vested | 828,953 | 828,953 | 731,596 | 873,810 | ||||||||||||
INTECH Long-Term Incentive Awards | ||||||||||||||||
Weighted average price per share (in dollars per share) | (per share) | $ 23.63 | $ 33.55 | £ 31.40 | |||||||||||||
Restricted Share Plan | ||||||||||||||||
Long-Term Incentive and Employee Compensation | ||||||||||||||||
Consideration from employees | £ | £ 0 | |||||||||||||||
Minimum amount of awards required for approval of remuneration committee | £ | £ 500,000 | |||||||||||||||
INTECH Long-Term Incentive Awards | ||||||||||||||||
Vesting period | 3 years | 3 years | ||||||||||||||
Buy As You Earn Share Plan | ||||||||||||||||
Long-Term Incentive and Employee Compensation | ||||||||||||||||
Maximum deduction from the gross salary (annually) | £ | £ 1,800 | |||||||||||||||
Matching shares for each share awarded | 1 | 1 | ||||||||||||||
Forfeiture period of matching shares if purchased shares are withdrawn | 1 year | 1 year | ||||||||||||||
Restricted Stock Awards | ||||||||||||||||
Price-Vesting Units | ||||||||||||||||
Number of replacement awards shares granted to employees | 1,395,824 | 1,395,824 | 73,982 | |||||||||||||
Number of price-vesting units vested | 1,238,185 | 1,238,185 | 444,884 | |||||||||||||
INTECH Long-Term Incentive Awards | ||||||||||||||||
Weighted average price per share (in dollars per share) | $ / shares | $ 24.37 | $ 35.08 | ||||||||||||||
Restricted Stock Awards | Minimum | ||||||||||||||||
INTECH Long-Term Incentive Awards | ||||||||||||||||
Vesting period | 3 years | 3 years | ||||||||||||||
Restricted Stock Awards | Maximum | ||||||||||||||||
INTECH Long-Term Incentive Awards | ||||||||||||||||
Vesting period | 4 years | 4 years | ||||||||||||||
Mutual Fund Share Awards | ||||||||||||||||
Price-Vesting Units | ||||||||||||||||
Awards granted (in dollars) | $ | $ 79,300,000 | |||||||||||||||
Time-based mutual fund share awards | Minimum | ||||||||||||||||
INTECH Long-Term Incentive Awards | ||||||||||||||||
Vesting period | 3 years | 3 years | ||||||||||||||
Time-based mutual fund share awards | Maximum | ||||||||||||||||
INTECH Long-Term Incentive Awards | ||||||||||||||||
Vesting period | 4 years | 4 years | ||||||||||||||
Price-Vesting Units | Janus Capital Group Inc | Chief Executive Officer | ||||||||||||||||
Price-Vesting Units | ||||||||||||||||
Number of replacement awards shares granted to employees | 83,863 | 134,666 | 137,178 | 138,901 | ||||||||||||
Awards granted (in dollars) | $ | $ 2,000,000 | $ 1,800,000 | $ 1,900,000 | $ 2,200,000 | ||||||||||||
INTECH Long-Term Incentive Awards | ||||||||||||||||
Vesting period | 3 years | 3 years | ||||||||||||||
Price-Vesting Units | Janus Capital Group Inc | Co-Chief Executive Officers | ||||||||||||||||
Price-Vesting Units | ||||||||||||||||
Number of replacement awards shares granted to employees | 108,184 | |||||||||||||||
Awards granted (in dollars) | $ | $ 3,700,000 | |||||||||||||||
INTECH Long-Term Incentive Awards | ||||||||||||||||
Vesting period | 3 years | |||||||||||||||
Price-Vesting Units, Granted in 2014 | Chief Executive Officer | ||||||||||||||||
Price-Vesting Units | ||||||||||||||||
Awards granted (in dollars) | $ | $ 2,300,000 | |||||||||||||||
Number of price-vesting units vested | 75,634 | |||||||||||||||
Price Vesting Units, Granted in 2015 | Chief Executive Officer | ||||||||||||||||
Price-Vesting Units | ||||||||||||||||
Number of replacement awards shares granted to employees | 65,548 | |||||||||||||||
Awards granted (in dollars) | $ | $ 2,000,000 | |||||||||||||||
Number of price-vesting units vested | 38,236 | |||||||||||||||
Price Vesting Units, Granted in 2016 | Chief Executive Officer | ||||||||||||||||
Price-Vesting Units | ||||||||||||||||
Number of replacement awards shares granted to employees | 63,549 | |||||||||||||||
Awards granted (in dollars) | $ | $ 2,000,000 | |||||||||||||||
Number of price-vesting units vested | 23,831 | 23,831 | ||||||||||||||
Appreciation Rights | Intech Investment Management LLC | ||||||||||||||||
INTECH Long-Term Incentive Awards | ||||||||||||||||
Dividend yield (as a percent) | 2.89% | 2.56% | 1.98% | |||||||||||||
Expected volatility (as a percent) | 28.00% | 30.00% | 34.00% | |||||||||||||
Risk-free interest rate (as a percent) | 1.93% | 1.81% | 2.53% | |||||||||||||
Expected life (in years) | 6 years | 6 years | 12 years | |||||||||||||
Grant date fair value (in millions) | $ | $ 2,600,000 | $ 2,000,000 | $ 23,200,000 | |||||||||||||
Merger date fair value (in millions) | $ | $ 1,800,000 | $ 900,000 | $ 13,300,000 | |||||||||||||
Vesting period | 10 years | |||||||||||||||
Number of years the rights are expected to be exercised | 4 years | 4 years | ||||||||||||||
2014 Stock Appreciation Rights SARS | Intech Investment Management LLC | ||||||||||||||||
INTECH Long-Term Incentive Awards | ||||||||||||||||
Expected life (in years) | 10 years | 10 years | ||||||||||||||
2015 Stock Appreciation Rights SARS | Intech Investment Management LLC | ||||||||||||||||
INTECH Long-Term Incentive Awards | ||||||||||||||||
Expected life (in years) | 5 years | 5 years | ||||||||||||||
Merger date fair value (in millions) | $ | $ 900,000 | |||||||||||||||
2016 Stock Appreciation Rights SARS | Intech Investment Management LLC | ||||||||||||||||
INTECH Long-Term Incentive Awards | ||||||||||||||||
Expected life (in years) | 7 years | 7 years | ||||||||||||||
Merger date fair value (in millions) | $ | $ 1,800,000 | |||||||||||||||
Profits Interests | Intech Investment Management LLC | ||||||||||||||||
INTECH Long-Term Incentive Awards | ||||||||||||||||
Vesting period | 10 years | |||||||||||||||
Maximum period for which distribution are made under profits interests post employment | 10 years | |||||||||||||||
Phantom Interests | Intech Investment Management LLC | ||||||||||||||||
INTECH Long-Term Incentive Awards | ||||||||||||||||
Vesting period | 5 years | |||||||||||||||
Profits Interest and Phantom Interests | Intech Investment Management LLC | ||||||||||||||||
INTECH Long-Term Incentive Awards | ||||||||||||||||
Percentage of equity-like stake in pre-incentive profits | 9.00% | 9.00% | ||||||||||||||
Undiscounted estimated post-employment payments | $ | $ 27,700,000 | |||||||||||||||
Profits Interest and Phantom Interests | Intech Investment Management LLC | Other non-current assets | ||||||||||||||||
INTECH Long-Term Incentive Awards | ||||||||||||||||
Profits and Phantom Interests | $ | $ 13,200,000 | |||||||||||||||
Profits Interest and Phantom Interests | Intech Investment Management LLC | Minimum | ||||||||||||||||
INTECH Long-Term Incentive Awards | ||||||||||||||||
Expected life (in years) | 10 years | 10 years | ||||||||||||||
Profits Interest and Phantom Interests | Intech Investment Management LLC | Maximum | ||||||||||||||||
INTECH Long-Term Incentive Awards | ||||||||||||||||
Expected life (in years) | 20 years | 20 years | ||||||||||||||
Profits Interest and Phantom Interests | Intech Investment Management LLC | Measurement Input, Discount Rate | ||||||||||||||||
INTECH Long-Term Incentive Awards | ||||||||||||||||
Discount rate | $ | 2 |
Long-Term Incentive Compensat_4
Long-Term Incentive Compensation - Compensation Plans (Details) | 1 Months Ended | 12 Months Ended | 24 Months Ended | ||||||||
Apr. 30, 2019£ / shares | Dec. 31, 2019GBP (£)£ / shares | Dec. 31, 2019USD ($)shares | Dec. 31, 2018USD ($) | Dec. 31, 2018£ / shares | Dec. 31, 2017USD ($) | Dec. 31, 2017£ / shares | Dec. 31, 2016$ / shares | Dec. 31, 2019USD ($)shares | Dec. 31, 2019£ / shares | Dec. 31, 2016£ / shares | |
Share Plan | |||||||||||
Performance hurdle related to Group TSR (as a percent) | 95.00% | 95.00% | |||||||||
Performance hurdle related to risk and sustainability metrics (as a percent) | 5.00% | 5.00% | |||||||||
Stock-based compensation plan expense | $ 73,700,000 | $ 81,600,000 | $ 66,800,000 | ||||||||
DEP Funds - Liability settled | 57,500,000 | 54,900,000 | 41,400,000 | ||||||||
MFSA - liability settled | 46,200,000 | 24,300,000 | 20,700,000 | ||||||||
Profits interests and other | (3,900,000) | 18,400,000 | 12,300,000 | ||||||||
Social Security costs | 10,800,000 | 9,400,000 | 10,300,000 | ||||||||
Total charge to the Consolidated Statements of Comprehensive Income | 184,300,000 | 188,600,000 | 151,500,000 | ||||||||
Stock-based payments expense unrecognized | $ 59,600,000 | $ 59,600,000 | |||||||||
Stock-based payments expense, weighted average years | 1 year 7 months 6 days | 1 year 7 months 6 days | |||||||||
DEP Funds - Liability settled, Unrecognised compensation | $ 28,800,000 | ||||||||||
MFSA - liability settled, Unrecognized compensation | 30,100,000 | ||||||||||
Profits interests, Unrecognized compensation | 14,400,000 | ||||||||||
Social security costs, Unrecognised compensation | 19,100,000 | ||||||||||
Total remaining charge to the Consolidated Statements of Comprehensive Income | $ 152,000,000 | ||||||||||
DEP Funds - Liability settled | 1 year 3 months 18 days | 1 year 3 months 18 days | |||||||||
MFSA - Liability settled | 2 years 1 month 6 days | 2 years 1 month 6 days | |||||||||
Profits interests and other | 4 years 6 months | 4 years 6 months | |||||||||
Social Security costs, weighted average years | 10 months 24 days | 10 months 24 days | |||||||||
Weighted average years, remaining charge to comprehensive income | 1 year 9 months 18 days | 1 year 9 months 18 days | |||||||||
Tranche 1 | |||||||||||
Share Plan | |||||||||||
Additional holding period | 2 years | 2 years | |||||||||
Tranche 2 | |||||||||||
Share Plan | |||||||||||
Additional holding period | 1 year | 1 year | |||||||||
Deferred Equity Plan | |||||||||||
Share Plan | |||||||||||
Stock-based compensation plan expense | $ 19,100,000 | 18,700,000 | 17,600,000 | ||||||||
Stock-based payments expense unrecognized | $ 13,500,000 | 13,500,000 | |||||||||
Stock-based payments expense, weighted average years | 1 year 4 months 24 days | 1 year 4 months 24 days | |||||||||
Restricted Share Plan | |||||||||||
Share Plan | |||||||||||
Vesting period | 3 years | 3 years | |||||||||
Stock-based compensation plan expense | $ 8,300,000 | 10,100,000 | 3,400,000 | ||||||||
Stock-based payments expense unrecognized | $ 6,800,000 | 6,800,000 | |||||||||
Stock-based payments expense, weighted average years | 1 year 7 months 6 days | 1 year 7 months 6 days | |||||||||
Buy As You Earn Share Plan | |||||||||||
Share Plan | |||||||||||
Maximum deduction from the gross salary (monthly) | £ | £ 150 | ||||||||||
Stock-based compensation plan expense | $ 2,100,000 | 3,000,000 | 3,200,000 | ||||||||
Stock-based payments expense unrecognized | $ 400,000 | 400,000 | |||||||||
Stock-based payments expense, weighted average years | 6 months | 6 months | |||||||||
Sharesave Plan | |||||||||||
Share Plan | |||||||||||
Maximum deduction from the gross salary (monthly) | $ 312.50 | 312.50 | 312.50 | ||||||||
Option exercise price | $ / shares | $ 31.20 | ||||||||||
Discount to the average share price | 15.00% | 15.00% | |||||||||
Market price at grant date | £ / shares | £ 2.15 | £ 4.99 | £ 75.28 | ||||||||
Stock-based compensation plan expense | $ 100,000 | $ 900,000 | $ 800,000 | ||||||||
Stock-based payments expense unrecognized | $ 700,000 | 700,000 | |||||||||
Stock-based payments expense, weighted average years | 2 years | 2 years | |||||||||
Black Scholes options pricing model | |||||||||||
Fair value of options granted (pence) | £ / shares | £ 2.15 | 4.99 | 75.28 | ||||||||
Dividend yield (as a percent) | 6.92% | 6.92% | 3.85% | 3.99% | |||||||
Expected volatility (as a percent) | 30.17% | 30.17% | 32.20% | 32.13% | |||||||
Risk-free interest rate (as a percent) | 0.55% | 0.55% | 0.70% | 0.19% | |||||||
Expected life (in years) | 3 years | 3 years | 3 years | 3 years | |||||||
RSA | |||||||||||
Share Plan | |||||||||||
Stock-based compensation plan expense | $ 42,200,000 | $ 44,900,000 | $ 32,800,000 | ||||||||
Stock-based payments expense unrecognized | $ 37,900,000 | 37,900,000 | |||||||||
Stock-based payments expense, weighted average years | 1 year 8 months 12 days | 1 year 8 months 12 days | |||||||||
Company Share Option Plan | |||||||||||
Share Plan | |||||||||||
Option exercise price | £ / shares | 22.80 | £ 26.10 | |||||||||
Exercisable period after vesting | 3 months | 3 months | |||||||||
Awards granted (in dollars) | $ 0 | ||||||||||
Market price at grant date | £ / shares | 33.43 | ||||||||||
Stock-based compensation plan expense | 300,000 | 600,000 | $ 1,100,000 | ||||||||
Stock-based payments expense unrecognized | $ 100,000 | 100,000 | |||||||||
Stock-based payments expense, weighted average years | 2 months 12 days | 2 months 12 days | |||||||||
Black Scholes options pricing model | |||||||||||
Fair value of options granted (pence) | £ / shares | 33.43 | ||||||||||
Dividend yield (as a percent) | 4.64% | ||||||||||
Expected volatility (as a percent) | 32.41% | ||||||||||
Risk-free interest rate (as a percent) | 0.27% | ||||||||||
Expected life (in years) | 3 years | ||||||||||
US CSOP | |||||||||||
Share Plan | |||||||||||
Market price at grant date | £ / shares | 32.81 | ||||||||||
Black Scholes options pricing model | |||||||||||
Fair value of options granted (pence) | £ / shares | 32.81 | ||||||||||
Dividend yield (as a percent) | 4.64% | ||||||||||
Expected volatility (as a percent) | 35.19% | ||||||||||
Risk-free interest rate (as a percent) | 0.16% | ||||||||||
Expected life (in years) | 2 years | ||||||||||
Executive Shared Ownership Plan | |||||||||||
Share Plan | |||||||||||
Market price at grant date | £ / shares | 27.78 | ||||||||||
Stock-based compensation plan expense | $ 300,000 | 800,000 | $ 1,500,000 | ||||||||
Stock-based payments expense unrecognized | $ 100,000 | 100,000 | |||||||||
Stock-based payments expense, weighted average years | 2 months 12 days | 2 months 12 days | |||||||||
Black Scholes options pricing model | |||||||||||
Fair value of options granted (pence) | £ / shares | 27.78 | ||||||||||
Dividend yield (as a percent) | 4.64% | ||||||||||
Expected volatility (as a percent) | 32.41% | ||||||||||
Risk-free interest rate (as a percent) | 0.27% | ||||||||||
Expected life (in years) | 3 years | ||||||||||
2017 ExSOP | |||||||||||
Share Plan | |||||||||||
Vesting period | 3 years | 3 years | |||||||||
Exercisable period after vesting | 2 years | 2 years | |||||||||
Awards granted (in dollars) | 0 | ||||||||||
Market price at grant date | £ / shares | 22.62 | ||||||||||
Hurdle price | £ / shares | 24.90 | ||||||||||
Black Scholes options pricing model | |||||||||||
Fair value of options granted (pence) | £ / shares | 22.62 | ||||||||||
2016 ExSOP | |||||||||||
Share Plan | |||||||||||
Market price at grant date | £ / shares | £ 26.14 | ||||||||||
Hurdle price | £ / shares | 28.45 | ||||||||||
Black Scholes options pricing model | |||||||||||
Fair value of options granted (pence) | £ / shares | £ 26.14 | ||||||||||
LongTerm Incentive Plan | |||||||||||
Share Plan | |||||||||||
Option exercise price | £ / shares | £ 0 | ||||||||||
Stock-based compensation plan expense | $ 1,300,000 | $ 2,600,000 | $ 6,400,000 | ||||||||
Stock-based payments expense unrecognized | $ 100,000 | $ 100,000 | |||||||||
Stock-based payments expense, weighted average years | 2 months 12 days | 2 months 12 days | |||||||||
2013 LTIP | |||||||||||
Share Plan | |||||||||||
Vesting period | 3 years | 3 years | |||||||||
Options exercise period | 5 years | 5 years | |||||||||
2014 LTIP | Minimum | |||||||||||
Share Plan | |||||||||||
Vesting period | 3 years | 3 years | |||||||||
2014 LTIP | Maximum | |||||||||||
Share Plan | |||||||||||
Vesting period | 4 years | 4 years | |||||||||
2014 LTIP | Tranche 1 | |||||||||||
Share Plan | |||||||||||
Awards to be vested (in percentage) | 3.00% | ||||||||||
2014 LTIP | Tranche 2 | |||||||||||
Share Plan | |||||||||||
Awards to be vested (in percentage) | 3.00% | ||||||||||
2015 LTIP | |||||||||||
Share Plan | |||||||||||
Vesting period | 3 years | 3 years | |||||||||
Award exercisable percentage from end of year four | 33.00% | 33.00% | |||||||||
2015 LTIP | Tranche 1 | |||||||||||
Share Plan | |||||||||||
Awards to be vested pre-Merger (in percentage) | 25.00% | ||||||||||
Awards to be vested post-Merger (in percentage) | 74.60% | ||||||||||
Monte Carlo Model | |||||||||||
Share price at DoM | 233.70% | 233.70% | |||||||||
Risk free discount rate | 0.10% | 0.10% | |||||||||
Dividend yield | 4.50% | 4.50% | |||||||||
Share price volatility | 30.00% | 30.00% | |||||||||
Holding period adjustment | 9 | 9 | |||||||||
Percentage based on pre-modification performance conditions | 80.00% | 80.00% | |||||||||
2015 LTIP | Tranche 2 | |||||||||||
Share Plan | |||||||||||
Awards to be vested pre-Merger (in percentage) | 25.00% | ||||||||||
Awards to be vested post-Merger (in percentage) | 35.50% | ||||||||||
Monte Carlo Model | |||||||||||
Share price at DoM | 233.70% | 233.70% | |||||||||
Risk free discount rate | 0.10% | 0.10% | |||||||||
Dividend yield | 4.50% | 4.50% | |||||||||
Share price volatility | 30.00% | 30.00% | |||||||||
Holding period adjustment | 6.2 | 6.2 | |||||||||
Percentage based on pre-modification performance conditions | 60.00% | 60.00% | |||||||||
2016 LTIP | |||||||||||
Share Plan | |||||||||||
Vesting period | 4 years | 4 years | |||||||||
Award exercisable percentage from end of year three | 67.00% | 67.00% | |||||||||
Award exercisable percentage from end of year four | 33.00% | 33.00% | |||||||||
2016 LTIP | Tranche 1 | |||||||||||
Share Plan | |||||||||||
Awards to be vested pre-Merger (in percentage) | 25.00% | ||||||||||
Awards to be vested post-Merger (in percentage) | 35.50% | ||||||||||
Monte Carlo Model | |||||||||||
Share price at DoM | 233.70% | 233.70% | |||||||||
Risk free discount rate | 0.10% | 0.10% | |||||||||
Dividend yield | 4.50% | 4.50% | |||||||||
Share price volatility | 30.00% | 30.00% | |||||||||
Holding period adjustment | 9 | 9 | |||||||||
2016 LTIP | Tranche 2 | |||||||||||
Monte Carlo Model | |||||||||||
Share price at DoM | 233.70% | 233.70% | |||||||||
Risk free discount rate | 0.10% | 0.10% | |||||||||
Dividend yield | 4.50% | 4.50% | |||||||||
Share price volatility | 30.00% | 30.00% | |||||||||
Holding period adjustment | 6.2 | 6.2 | |||||||||
Relative TSR | |||||||||||
Share Plan | |||||||||||
Weight of awards criteria in performance conditions | 50.00% | 50.00% | |||||||||
Relative TSR | 2015 LTIP | |||||||||||
Monte Carlo Model | |||||||||||
Allocation of award (as a percent) | 50.00% | 50.00% | |||||||||
Relative TSR | 2015 LTIP | Tranche 1 | |||||||||||
Monte Carlo Model | |||||||||||
Allocation of award (as a percent) | 118.96% | 118.96% | |||||||||
Relative TSR | 2015 LTIP | Tranche 2 | |||||||||||
Monte Carlo Model | |||||||||||
Allocation of award (as a percent) | 124.11% | 124.11% | |||||||||
Relative TSR | 2016 LTIP | |||||||||||
Monte Carlo Model | |||||||||||
Allocation of award (as a percent) | 50.00% | 50.00% | |||||||||
Relative TSR | 2016 LTIP | Tranche 1 | |||||||||||
Monte Carlo Model | |||||||||||
Allocation of award (as a percent) | 120.98% | 120.98% | |||||||||
Relative TSR | 2016 LTIP | Tranche 2 | |||||||||||
Monte Carlo Model | |||||||||||
Allocation of award (as a percent) | 123.64% | 123.64% | |||||||||
Relative investment performance | |||||||||||
Share Plan | |||||||||||
Weight of awards criteria in performance conditions | 25.00% | 25.00% | |||||||||
Relative investment performance | 2015 LTIP | |||||||||||
Monte Carlo Model | |||||||||||
Allocation of award (as a percent) | 25.00% | 25.00% | |||||||||
Relative investment performance | 2015 LTIP | Tranche 1 | |||||||||||
Monte Carlo Model | |||||||||||
Allocation of award (as a percent) | 209.76% | 209.76% | |||||||||
Relative investment performance | 2015 LTIP | Tranche 2 | |||||||||||
Monte Carlo Model | |||||||||||
Allocation of award (as a percent) | 206.59% | 206.59% | |||||||||
Relative investment performance | 2016 LTIP | |||||||||||
Monte Carlo Model | |||||||||||
Allocation of award (as a percent) | 25.00% | 25.00% | |||||||||
Relative investment performance | 2016 LTIP | Tranche 1 | |||||||||||
Monte Carlo Model | |||||||||||
Allocation of award (as a percent) | 200.42% | 200.42% | |||||||||
Relative investment performance | 2016 LTIP | Tranche 2 | |||||||||||
Monte Carlo Model | |||||||||||
Allocation of award (as a percent) | 197.39% | 197.39% | |||||||||
Relative net income before tax growth | |||||||||||
Share Plan | |||||||||||
Weight of awards criteria in performance conditions | 25.00% | 25.00% | |||||||||
Relative net income before tax growth | 2015 LTIP | |||||||||||
Monte Carlo Model | |||||||||||
Allocation of award (as a percent) | 25.00% | 25.00% | |||||||||
Relative net income before tax growth | 2015 LTIP | Tranche 1 | |||||||||||
Monte Carlo Model | |||||||||||
Allocation of award (as a percent) | 209.76% | 209.76% | |||||||||
Relative net income before tax growth | 2015 LTIP | Tranche 2 | |||||||||||
Monte Carlo Model | |||||||||||
Allocation of award (as a percent) | 206.59% | 206.59% | |||||||||
Relative net income before tax growth | 2016 LTIP | |||||||||||
Monte Carlo Model | |||||||||||
Allocation of award (as a percent) | 25.00% | 25.00% | |||||||||
Relative net income before tax growth | 2016 LTIP | Tranche 1 | |||||||||||
Monte Carlo Model | |||||||||||
Allocation of award (as a percent) | 200.42% | 200.42% | |||||||||
Relative net income before tax growth | 2016 LTIP | Tranche 2 | |||||||||||
Monte Carlo Model | |||||||||||
Allocation of award (as a percent) | 197.39% | 197.39% | |||||||||
FTSE 350 | |||||||||||
Share Plan | |||||||||||
Weight of awards criteria in performance conditions | 25.00% | 25.00% | |||||||||
ASX 100 | |||||||||||
Share Plan | |||||||||||
Weight of awards criteria in performance conditions | 25.00% | 25.00% | |||||||||
Net fund flows condition | |||||||||||
Share Plan | |||||||||||
Weight of awards criteria in performance conditions | 15.00% | 15.00% | |||||||||
Investment performance condition | |||||||||||
Share Plan | |||||||||||
Weight of awards criteria in performance conditions | 15.00% | 15.00% | |||||||||
Operating margin condition | |||||||||||
Share Plan | |||||||||||
Weight of awards criteria in performance conditions | 15.00% | 15.00% | |||||||||
People strategy condition | |||||||||||
Share Plan | |||||||||||
Weight of awards criteria in performance conditions | 10.00% | 10.00% | |||||||||
UK employees | Sharesave Plan | |||||||||||
Share Plan | |||||||||||
Vesting period | 3 years | 3 years | |||||||||
Maximum deduction from the gross salary (monthly) | £ | £ 500 | ||||||||||
Option exercise price | £ / shares | £ 20.16 | £ 18.40 | £ 14.76 | ||||||||
Discount to the average share price | 20.00% | 20.00% | |||||||||
Average share price in prior period | 5 days | 5 days | |||||||||
Exercisable period after vesting | 6 months | 6 months | |||||||||
UK employees | Company Share Option Plan | |||||||||||
Share Plan | |||||||||||
Vesting period | 3 years | 3 years | |||||||||
Exercisable period after vesting | 2 years | 2 years | |||||||||
Maximum value of unvested options approved | shares | 30,000 | 30,000 |
Long-Term Incentive Compensat_5
Long-Term Incentive Compensation - ESOP and RSA (Details) £ / shares in Units, £ in Millions | 12 Months Ended | ||||||||
Dec. 31, 2019GBP (£)shares | Dec. 31, 2019GBP (£)$ / sharesshares | Dec. 31, 2018GBP (£)£ / sharesshares | Dec. 31, 2018GBP (£)$ / sharesshares | Dec. 31, 2017GBP (£)£ / sharesshares | Dec. 31, 2017GBP (£)£ / shares$ / sharesshares | Dec. 31, 2016$ / sharesshares | Dec. 31, 2019$ / shares | Dec. 31, 2018$ / shares | |
Summary of unvested restricted stock awards | |||||||||
Unvested at the beginning of the year (in shares) | 3,378,150 | 3,537,221 | |||||||
Granted (in shares) | 1,107,382 | ||||||||
Vested (in shares) | (1,197,671) | ||||||||
Forfeited (in shares) | (68,782) | ||||||||
Unvested at the end of the year (in shares) | 3,378,150 | 3,537,221 | |||||||
Weighted-average grant date fair value | |||||||||
Balance at the beginning of the year (in dollars per share) | $ / shares | $ 32.35 | $ 30.81 | |||||||
Granted (in dollars per share) | $ / shares | 35.57 | ||||||||
Vested (in dollars per share) | $ / shares | 30.76 | ||||||||
Forfeited (in dollars per share) | $ / shares | 32.49 | ||||||||
Balance at the end of the year (in dollars per share) | $ / shares | 32.35 | $ 30.81 | |||||||
Deferred Equity Plan | |||||||||
Summary of unvested restricted stock awards | |||||||||
Unvested at the beginning of the year (in shares) | 1,738,776 | 1,442,091 | 16,466,630 | ||||||
Share consolidation (in shares) | (14,825,509) | ||||||||
Adjustment (in shares) | 1,275 | ||||||||
Granted (in shares) | 1,403,472 | 1,129,504 | 919,967 | ||||||
Vested (in shares) | (828,953) | (731,596) | (873,810) | ||||||
Forfeited (in shares) | (193,345) | (101,223) | (246,462) | ||||||
Unvested at the end of the year (in shares) | 2,119,950 | 1,738,776 | 1,442,091 | 16,466,630 | |||||
Weighted-average grant date fair value | |||||||||
Balance at the beginning of the year (in dollars per share) | (per share) | 33.41 | £ 32.36 | 32.36 | £ 3.17 | |||||
Share consolidation (in dollars per share) | £ / shares | 31.64 | ||||||||
Adjustment (in dollars per share) | £ / shares | 15.43 | ||||||||
Granted (in dollars per share) | (per share) | 23.63 | 33.55 | 31.40 | ||||||
Vested (in dollars per share) | (per share) | 31.44 | 33.80 | 31.33 | ||||||
Forfeited (in dollars per share) | (per share) | 28.42 | 33.07 | 28.06 | ||||||
Balance at the end of the year (in dollars per share) | (per share) | $ 26.98 | $ 33.41 | £ 32.36 | $ 32.36 | |||||
Stock Options | |||||||||
Shares | |||||||||
Outstanding at the beginning of the year (in shares) | 3,139,762 | 4,319,706 | 45,560,242 | ||||||
Share consolidation (in shares) | (41,004,619) | ||||||||
Acquired from Merger (in shares) | 92,949 | ||||||||
Granted (in shares) | 244,336 | 84,273 | 2,042,321 | ||||||
Exercised (in shares) | (325,134) | (212,562) | (404,735) | ||||||
Forfeited (in shares) | (1,185,037) | (1,051,655) | (1,966,452) | ||||||
Outstanding at the end of the year (in shares) | 1,873,927 | 3,139,762 | 4,319,706 | 45,560,242 | |||||
Exercisable (in shares) | 91,099 | 91,099 | 707,848 | 707,848 | 5,014,642 | 5,014,642 | |||
Vested or expected to vest (in shares) | 962,064 | 962,064 | 1,157,663 | 1,157,663 | 2,999,811 | 2,999,811 | |||
Weighted-average price | |||||||||
Outstanding at the beginning of the year (in dollars per share) | (per share) | $ 27.91 | £ 22.55 | $ 22.55 | £ 1.97 | |||||
Share consolidation (in dollars per share) | £ / shares | 19.82 | ||||||||
Acquired from Merger (in dollars per share) | £ / shares | 18.76 | ||||||||
Granted (in dollars per share) | (per share) | 18.84 | 26.88 | 13.66 | ||||||
Exercised (in dollars per share) | (per share) | 5.43 | 12.31 | 20.32 | ||||||
Forfeited (in dollars per share) | (per share) | 28.30 | 11.81 | 7.41 | ||||||
Outstanding at the end of the year (in dollars per share) | (per share) | $ 28.41 | $ 27.91 | 22.55 | $ 22.55 | |||||
Exercisable (in dollars per share) | (per share) | 34.67 | $ 34.67 | $ 33.75 | ||||||
Vested or expected to vest (in dollars per share) | (per share) | £ 15.57 | $ 15.57 | $ 32.97 | $ 1.51 | |||||
Intrinsic value of options | |||||||||
Exercised | £ | £ 0.4 | £ 0.1 | £ 2.8 | ||||||
Outstanding | £ | 1 | $ 1 | 0.2 | $ 0.2 | 15.9 | $ 15.9 | |||
Exercisable | £ | £ 0.3 | $ 0.3 | £ 0.2 | $ 0.2 | £ 3.9 | $ 3.9 | |||
Restricted Stock Awards | |||||||||
Summary of unvested restricted stock awards | |||||||||
Unvested at the beginning of the year (in shares) | 3,378,150 | 3,537,221 | 4,068,619 | ||||||
Granted (in shares) | 1,395,824 | 73,982 | |||||||
Vested (in shares) | (1,238,185) | (444,884) | |||||||
Forfeited (in shares) | (138,819) | (160,496) | |||||||
Unvested at the end of the year (in shares) | 3,396,970 | 3,378,150 | 3,537,221 | 4,068,619 | |||||
Weighted-average grant date fair value | |||||||||
Balance at the beginning of the year (in dollars per share) | $ / shares | $ 32.35 | $ 30.81 | $ 30.72 | ||||||
Granted (in dollars per share) | $ / shares | 24.37 | 35.08 | |||||||
Vested (in dollars per share) | $ / shares | 31.92 | 30.73 | |||||||
Forfeited (in dollars per share) | $ / shares | 30.72 | 30.72 | |||||||
Balance at the end of the year (in dollars per share) | $ / shares | $ 29.30 | $ 32.35 | $ 30.81 | $ 30.72 |
Retirement benefit plans (Detai
Retirement benefit plans (Details) £ in Millions, $ in Millions | 12 Months Ended | |||
Dec. 31, 2019GBP (£)item | Dec. 31, 2019USD ($)item | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Net periodic benefit credit | ||||
Retirement benefit plan | item | 2 | 2 | ||
Expenses related to 401(k) plan | $ 7.9 | $ 5.8 | ||
Defined benefit pension Plan | ||||
Defined Benefit Plans | ||||
Surplus on a technical provisions basis | £ 12 | 15.9 | ||
Foreign Plan | ||||
Defined Contribution Plan | ||||
Amounts charged to consolidated statements of comprehensive income | $ 10.4 | $ 7.5 | $ 11.8 | |
Maximum | U.S. | ||||
Net periodic benefit credit | ||||
Employer matching contribution per calendar year (as a percent of compensation) | 5.00% | 5.00% |
Retirement benefit plans - Chan
Retirement benefit plans - Change in plan assets and benefit obligations, net retirement benefit recognized in balance sheet, assumptions (Details) £ in Millions, $ in Millions | Sep. 05, 2019GBP (£) | Sep. 05, 2019USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) |
Change in benefit obligation: | |||||
Service cost | $ (0.8) | $ (1.2) | $ (1.2) | ||
Interest cost | $ (17.4) | (17.3) | (19.2) | ||
Key assumptions used in determining the defined benefit obligation | |||||
Number of years in time | 15 years | ||||
Defined benefit pension Plan | |||||
Change in plan assets: | |||||
Fair value of plan assets at the beginning of the year | $ 849.5 | 941.8 | |||
Return on plan assets | 100.1 | (11.1) | |||
Employer contributions | £ 328 | $ 404 | 2 | 12.5 | |
Benefits paid | (14.8) | (14.7) | |||
Settlements | (25.4) | (24) | |||
Foreign currency translation | 34.5 | (55) | |||
Fair value of plan assets at the end of the year | 945.9 | 849.5 | 941.8 | ||
Change in benefit obligation: | |||||
Benefit obligations at the beginning of the year | (613.3) | (719.1) | |||
Service cost | (0.8) | (1.2) | |||
Interest cost | (17.4) | (17.3) | |||
Settlements | 25.4 | 24 | |||
Plan amendments | 3.9 | ||||
Benefits paid | 14.8 | 14.7 | |||
Actuarial gain (loss) | (86.8) | 47.6 | |||
Foreign currency translation | (25.1) | 41.9 | |||
Benefit obligations at the end of the year | (703.2) | (613.3) | $ (719.1) | ||
Funded status as at year end | 242.7 | 236.2 | |||
Tax at source | (33.1) | (33.4) | |||
Net retirement benefit asset recognized in the Consolidated Balance Sheets | 209.6 | 202.8 | |||
Retirement benefit assets recognized in the Consolidated Balance Sheets: | |||||
Janus Henderson Group UK Pension Scheme | 214 | 206.5 | |||
Retirement benefit obligations recognized in the Consolidated Balance Sheets: | |||||
Janus Henderson Group unapproved pension scheme | (4.4) | (3.7) | |||
Net retirement benefit asset recognized in the Consolidated Balance Sheets | $ 209.6 | $ 202.8 | |||
Key assumptions used in determining the defined benefit obligation | |||||
Discount rate | 2.10% | 2.90% | |||
Inflation - salaries | 2.5 | 2.5 | |||
Inflation - Retail Price Index ("RPI") | 3 | 3.1 | |||
Inflation - Consumer Price Index ("CPI") | 1.9 | 2 | |||
Pension increases (RPI capped at 5% p.a.) | 2.9 | 3 | |||
Pension increases (RPI capped at 2.5% p.a.) | 2 | 2.1 | |||
Life expectancy of male aged 60 at accounting date | 28 years 3 months 18 days | 28 years 2 months 12 days | |||
Life expectancy of male aged 60 in 15 years time | 29 years 3 months 18 days | 29 years 2 months 12 days |
Retirement benefit plans - Plan
Retirement benefit plans - Plan assets (Details) - Defined benefit pension Plan $ in Millions | 12 Months Ended | ||
Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2019USD ($) | |
Fair value of plan assets | |||
Total assets at fair value | $ 945.9 | $ 941.8 | $ 945.9 |
Assets held in JHG managed funds | 250.9 | ||
Change in fair value of plan assets level 3 reconciliation | |||
Fair value of plan assets at the beginning of the year | 849.5 | 941.8 | |
Losses recognized in the period | 100.1 | (11.1) | |
Fair value of plan assets at the end of the year | $ 945.9 | $ 849.5 | |
Expected rate of return on plan assets (as a percent) | 2.5 | 2.5 | |
Cash and cash equivalents | |||
Fair value of plan assets | |||
Total assets at fair value | $ 6.4 | $ 6.4 | 3.7 |
Change in fair value of plan assets level 3 reconciliation | |||
Fair value of plan assets at the beginning of the year | 6.4 | ||
Fair value of plan assets at the end of the year | 3.7 | 6.4 | |
Money market instruments | |||
Fair value of plan assets | |||
Total assets at fair value | 21.6 | 21.6 | 78.1 |
Change in fair value of plan assets level 3 reconciliation | |||
Fair value of plan assets at the beginning of the year | 21.6 | ||
Fair value of plan assets at the end of the year | 78.1 | 21.6 | |
Forward foreign exchange contracts | |||
Fair value of plan assets | |||
Total assets at fair value | 0.3 | 0.3 | |
Change in fair value of plan assets level 3 reconciliation | |||
Fair value of plan assets at the beginning of the year | 0.3 | ||
Fair value of plan assets at the end of the year | 0.3 | ||
Bulk annuity policy | |||
Fair value of plan assets | |||
Total assets at fair value | 395.8 | $ 395.8 | |
Strategic allocation of plan assets | 40.00% | ||
Change in fair value of plan assets level 3 reconciliation | |||
Fair value of plan assets at the end of the year | 395.8 | ||
Fixed income investments | |||
Fair value of plan assets | |||
Total assets at fair value | 623.2 | 623.2 | $ 261.4 |
Strategic allocation of plan assets | 30.00% | ||
Change in fair value of plan assets level 3 reconciliation | |||
Fair value of plan assets at the beginning of the year | 623.2 | ||
Fair value of plan assets at the end of the year | 261.4 | 623.2 | |
Equity investments | |||
Fair value of plan assets | |||
Total assets at fair value | 198 | 198 | $ 206.9 |
Change in fair value of plan assets level 3 reconciliation | |||
Fair value of plan assets at the beginning of the year | 198 | ||
Fair value of plan assets at the end of the year | 206.9 | 198 | |
Growth portfolio | |||
Fair value of plan assets | |||
Strategic allocation of plan assets | 30.00% | ||
Fair value measurements, recurring | |||
Fair value of plan assets | |||
Total assets at fair value | 849.5 | 849.5 | $ 945.9 |
Change in fair value of plan assets level 3 reconciliation | |||
Fair value of plan assets at the beginning of the year | 849.5 | ||
Fair value of plan assets at the end of the year | 945.9 | 849.5 | |
Fair value measurements, recurring | Cash and cash equivalents | |||
Fair value of plan assets | |||
Total assets at fair value | 6.4 | 6.4 | 3.7 |
Change in fair value of plan assets level 3 reconciliation | |||
Fair value of plan assets at the beginning of the year | 6.4 | ||
Fair value of plan assets at the end of the year | 3.7 | 6.4 | |
Fair value measurements, recurring | Money market instruments | |||
Fair value of plan assets | |||
Total assets at fair value | 21.6 | 21.6 | 78.1 |
Change in fair value of plan assets level 3 reconciliation | |||
Fair value of plan assets at the beginning of the year | 21.6 | ||
Fair value of plan assets at the end of the year | 78.1 | 21.6 | |
Fair value measurements, recurring | Forward foreign exchange contracts | |||
Fair value of plan assets | |||
Total assets at fair value | 0.3 | 0.3 | |
Change in fair value of plan assets level 3 reconciliation | |||
Fair value of plan assets at the beginning of the year | 0.3 | ||
Fair value of plan assets at the end of the year | 0.3 | ||
Fair value measurements, recurring | Bulk annuity policy | |||
Fair value of plan assets | |||
Total assets at fair value | 395.8 | 395.8 | |
Change in fair value of plan assets level 3 reconciliation | |||
Fair value of plan assets at the end of the year | 395.8 | ||
Fair value measurements, recurring | Fixed income investments | |||
Fair value of plan assets | |||
Total assets at fair value | 623.2 | 623.2 | 261.4 |
Change in fair value of plan assets level 3 reconciliation | |||
Fair value of plan assets at the beginning of the year | 623.2 | ||
Fair value of plan assets at the end of the year | 261.4 | 623.2 | |
Fair value measurements, recurring | Equity investments | |||
Fair value of plan assets | |||
Total assets at fair value | 198 | 198 | 206.9 |
Change in fair value of plan assets level 3 reconciliation | |||
Fair value of plan assets at the beginning of the year | 198 | ||
Fair value of plan assets at the end of the year | 206.9 | 198 | |
Fair value measurements, recurring | Level 1 | |||
Fair value of plan assets | |||
Total assets at fair value | 625.7 | 625.7 | 472 |
Change in fair value of plan assets level 3 reconciliation | |||
Fair value of plan assets at the beginning of the year | 625.7 | ||
Fair value of plan assets at the end of the year | 472 | 625.7 | |
Fair value measurements, recurring | Level 1 | Cash and cash equivalents | |||
Fair value of plan assets | |||
Total assets at fair value | 6.4 | 6.4 | 3.7 |
Change in fair value of plan assets level 3 reconciliation | |||
Fair value of plan assets at the beginning of the year | 6.4 | ||
Fair value of plan assets at the end of the year | 3.7 | 6.4 | |
Fair value measurements, recurring | Level 1 | Forward foreign exchange contracts | |||
Fair value of plan assets | |||
Total assets at fair value | 0.3 | 0.3 | |
Change in fair value of plan assets level 3 reconciliation | |||
Fair value of plan assets at the beginning of the year | 0.3 | ||
Fair value of plan assets at the end of the year | 0.3 | ||
Fair value measurements, recurring | Level 1 | Fixed income investments | |||
Fair value of plan assets | |||
Total assets at fair value | 619 | 619 | 261.4 |
Change in fair value of plan assets level 3 reconciliation | |||
Fair value of plan assets at the beginning of the year | 619 | ||
Fair value of plan assets at the end of the year | 261.4 | 619 | |
Fair value measurements, recurring | Level 1 | Equity investments | |||
Fair value of plan assets | |||
Total assets at fair value | 206.9 | 206.9 | |
Change in fair value of plan assets level 3 reconciliation | |||
Fair value of plan assets at the end of the year | 206.9 | ||
Fair value measurements, recurring | Level 2 | |||
Fair value of plan assets | |||
Total assets at fair value | 223.8 | 223.8 | 78.1 |
Change in fair value of plan assets level 3 reconciliation | |||
Fair value of plan assets at the beginning of the year | 223.8 | ||
Fair value of plan assets at the end of the year | 78.1 | 223.8 | |
Fair value measurements, recurring | Level 2 | Money market instruments | |||
Fair value of plan assets | |||
Total assets at fair value | 21.6 | 21.6 | 78.1 |
Change in fair value of plan assets level 3 reconciliation | |||
Fair value of plan assets at the beginning of the year | 21.6 | ||
Fair value of plan assets at the end of the year | 78.1 | 21.6 | |
Fair value measurements, recurring | Level 2 | Fixed income investments | |||
Fair value of plan assets | |||
Total assets at fair value | 4.2 | 4.2 | |
Change in fair value of plan assets level 3 reconciliation | |||
Fair value of plan assets at the beginning of the year | 4.2 | ||
Fair value of plan assets at the end of the year | 4.2 | ||
Fair value measurements, recurring | Level 2 | Equity investments | |||
Fair value of plan assets | |||
Total assets at fair value | 198 | 198 | |
Change in fair value of plan assets level 3 reconciliation | |||
Fair value of plan assets at the beginning of the year | 198 | ||
Fair value of plan assets at the end of the year | $ 198 | ||
Fair value measurements, recurring | Level 3 | |||
Fair value of plan assets | |||
Total assets at fair value | 395.8 | 395.8 | |
Change in fair value of plan assets level 3 reconciliation | |||
Fair value of plan assets at the end of the year | 395.8 | ||
Fair value measurements, recurring | Level 3 | Bulk annuity policy | |||
Fair value of plan assets | |||
Total assets at fair value | 395.8 | $ 395.8 | |
Change in fair value of plan assets level 3 reconciliation | |||
Fair value of plan assets at the end of the year | $ 395.8 |
Retirement benefit plans - Actu
Retirement benefit plans - Actuarial gains(losses), benefit cost, cash flows (Details) £ in Millions, $ in Millions | Sep. 05, 2019GBP (£) | Sep. 05, 2019USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) |
Components of net periodic benefit cost | |||||
Service cost | $ (0.8) | $ (1.2) | $ (1.2) | ||
Settlement gain | 2.1 | 1.6 | 1.6 | ||
Interest cost | (17.4) | (17.3) | (19.2) | ||
Expected return on plan assets | 18.6 | 21.3 | 20.3 | ||
Amortization of prior service cost | (0.4) | ||||
Net periodic benefit credit | 2.1 | 4.4 | 1.5 | ||
Contributions to money purchase section | (7.9) | (8) | (7.4) | ||
Total cost | (5.8) | (3.6) | $ (5.9) | ||
Prior year service cost, UK pension schemes | 3.7 | ||||
Amortization expected next fiscal year | 0.4 | ||||
Defined benefit pension Plan | |||||
Actuarial gains and losses | |||||
Opening accumulated unamortized actuarial gain | 24.7 | 21 | |||
Current year actuarial gain (loss) | (5.5) | 14.4 | |||
Tax at source on current year actuarial gain (loss) | 0.9 | (6.5) | |||
Current year prior service cost | 0.4 | (3.7) | |||
Release of actuarial gain due to settlement event | (2.1) | (1.1) | |||
Release of tax at source due to settlement event | 0.7 | 0.6 | |||
Closing accumulated unamortized actuarial gain | 19.1 | 24.7 | |||
Actuarial gains amortized from AOCI | 0 | 0 | |||
Actuarial gains expected to be amortized during 2019 | $ 0 | ||||
Percentage of all plan participants | 33.00% | ||||
Employer contributions to the plan | £ 328 | $ 404 | $ 2 | 12.5 | |
Components of net periodic benefit cost | |||||
Service cost | (0.8) | (1.2) | |||
Interest cost | $ (17.4) | $ (17.3) | |||
Key assumptions used in determining the net periodic benefit cost | |||||
Discount rate | 2.90% | 2.60% | 2.90% | ||
Inflation - salaries | 2.5 | 2.5 | 2.5 | ||
Inflation - RPI | 3.1 | 3.1 | 3.2 | ||
Inflation - CPI | 2 | 2 | 2.1 | ||
Pension increases (RPI capped at 5% p.a.) | 3 | 3 | 3 | ||
Pension increases (RPI capped at 2.5% p.a.) | 2.1 | 2.1 | 2.1 | ||
Expected return on plan assets | 2.50% | 2.50% | 2.60% | ||
Amortization period for net actuarial gains at beginning of the year | 10 years | 11 years | 11 years | ||
Employer contributions to the plan excluding credits to member's Money Purchase Accounts | $ 2 | ||||
Expected contributions to the scheme during 2018 | 0.8 | ||||
Expected future benefit payments | |||||
2020 | 22.9 | ||||
2021 | 20.1 | ||||
2022 | 22 | ||||
2023 | 23.7 | ||||
2024 | 25 | ||||
2025-2029 | $ 131.1 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Changes in accumulated other comprehensive loss, net of tax | |||
Beginning balance | $ 4,839.3 | ||
Less: other comprehensive loss (income) attributable to noncontrolling interests | (12.7) | $ 1.4 | $ 20.8 |
Ending balance | 4,886.5 | 4,839.3 | |
Accumulated other comprehensive loss | |||
Changes in accumulated other comprehensive loss, net of tax | |||
Beginning balance | (423.5) | (304.3) | |
Other comprehensive income (loss) | 69.1 | (120.6) | |
Less: other comprehensive loss (income) attributable to noncontrolling interests | (12.7) | 1.4 | |
Ending balance | (367.1) | (423.5) | (304.3) |
Foreign currency translation adjustments | |||
Changes in accumulated other comprehensive loss, net of tax | |||
Beginning balance | (448.2) | (325.3) | |
Other comprehensive income (loss) | 74.7 | (124.3) | |
Less: other comprehensive loss (income) attributable to noncontrolling interests | (12.7) | 1.4 | |
Ending balance | (386.2) | (448.2) | (325.3) |
Retirement benefit asset, net | |||
Changes in accumulated other comprehensive loss, net of tax | |||
Beginning balance | 24.7 | 21 | |
Other comprehensive income (loss) | (5.6) | 3.7 | |
Ending balance | $ 19.1 | $ 24.7 | $ 21 |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive Loss - OCI (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Other comprehensive income, net of tax | |||
Other comprehensive income (loss) | $ 69.1 | $ (120.6) | $ 111.9 |
Accumulated other comprehensive loss | |||
Other comprehensive income, net of tax | |||
Tax expense (benefit) | 0.3 | ||
Pre-tax amount | 68.8 | (121.2) | 112.3 |
Tax expense (benefit) | 0.6 | (0.4) | |
Other comprehensive income (loss) | 69.1 | (120.6) | 111.9 |
Available-for-sale securities | |||
Other comprehensive income, net of tax | |||
Pre-tax amount | 1.9 | ||
Net amount | 1.9 | ||
Foreign currency translation adjustments | |||
Other comprehensive income, net of tax | |||
Pre-tax amount | 74.3 | (124.3) | 125 |
Tax impact | 0.4 | ||
Net amount | 74.7 | (124.3) | 125 |
Retirement benefit asset, net | |||
Other comprehensive income, net of tax | |||
Pre-tax amount | (4.1) | 4.2 | (10.2) |
Tax impact | (0.1) | 0.6 | (0.4) |
Net amount | (4.2) | 4.8 | (10.6) |
Reclassification to net income | |||
Other comprehensive income, net of tax | |||
Pre-tax amount | (1.4) | (1.1) | (4.4) |
Net amount | $ (1.4) | $ (1.1) | $ (4.4) |
Earnings and Dividends Per Sh_3
Earnings and Dividends Per Share (Details) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2019USD ($)$ / shares | Sep. 30, 2019USD ($)$ / shares | Jun. 30, 2019USD ($)$ / shares | Mar. 31, 2019USD ($)$ / shares | Dec. 31, 2018USD ($)$ / shares | Sep. 30, 2018USD ($)$ / shares | Jun. 30, 2018USD ($)$ / shares | Mar. 31, 2018USD ($)$ / shares | Dec. 31, 2019USD ($)$ / sharesshares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017USD ($)$ / sharesshares | Dec. 31, 2017£ / shares | |
Earnings per share | ||||||||||||
Net income attributable to JHG | $ | $ 112 | $ 112.1 | $ 109.4 | $ 94.1 | $ 106.8 | $ 111.2 | $ 140.6 | $ 165.2 | $ 427.6 | $ 523.8 | $ 655.5 | |
Less: Allocation of earnings to participating stock-based awards | $ | (11.7) | (12.7) | (17.3) | |||||||||
Net income attributable to JHG common shareholders | $ | $ 415.9 | $ 511.1 | $ 638.2 | |||||||||
Weighted-average common shares outstanding - basic | 188 | 195 | 160.7 | |||||||||
Dilutive effect of non-participating stock-based awards | 0.6 | 0.9 | 1.6 | |||||||||
Weighted-average common shares outstanding - diluted | 188.6 | 195.9 | 162.3 | |||||||||
Earnings per share: | ||||||||||||
Basic (two class) (in dollars per share) | $ / shares | $ 0.59 | $ 0.58 | $ 0.56 | $ 0.48 | $ 0.54 | $ 0.55 | $ 0.70 | $ 0.82 | $ 2.21 | $ 2.62 | $ 3.97 | |
Diluted (two class) (in dollars per share) | $ / shares | $ 0.59 | $ 0.58 | $ 0.56 | $ 0.48 | $ 0.54 | $ 0.55 | $ 0.70 | $ 0.82 | 2.21 | 2.61 | 3.93 | |
Dividends paid per share - pre Merger | £ / shares | £ 0.0915 | |||||||||||
Dividends paid per share - post Merger | $ / shares | 1.4400 | 1.4000 | 0.6400 | |||||||||
Dividends Per Share | ||||||||||||
Dividends paid (per share) | (per share) | $ 1.44 | $ 1.40 | $ 0.64 | £ 0.0915 | ||||||||
Cash dividends paid | $ | $ 272.4 | $ 275.1 | $ 256 | |||||||||
Unvested nonparticipating stock awards | ||||||||||||
Anti-dilutive securities that have not been included in the calculation of weighted average diluted shares outstanding | ||||||||||||
Number of anti-dilutive securities that have not been included in the calculation of weighted average diluted shares outstanding | 1.1 | 1 | 0.8 | |||||||||
Dai-ichi options | ||||||||||||
Anti-dilutive securities that have not been included in the calculation of weighted average diluted shares outstanding | ||||||||||||
Number of anti-dilutive securities that have not been included in the calculation of weighted average diluted shares outstanding | 10 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - Richard Pease Versus Henderson Administration Limited - USD ($) $ in Millions | Feb. 15, 2019 | Mar. 31, 2018 |
Charges related to case | $ 12.2 | |
Fund Transfer Fees awarded to the Group | $ 5 | |
Interest awarded | $ 0.3 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Related party transaction | |||
Revenue recognized from managed funds | $ 1,870.1 | $ 1,953.2 | $ 1,473.5 |
Accrued income | 198.2 | 187.2 | |
Accounts receivable | 34 | 29.7 | |
Dai-ichi | |||
Related party transaction | |||
Investment management fees | $ 15.8 | $ 14.9 |
Geographic Information (Details
Geographic Information (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenue: | |||||||||||
Revenue from Contract with Customer, Including Assessed Tax | $ 601.2 | $ 536 | $ 535.9 | $ 519.3 | $ 545.1 | $ 581.2 | $ 592.4 | $ 587.7 | $ 2,192.4 | $ 2,306.4 | $ 1,818.3 |
Long-lived assets: | |||||||||||
Long-lived assets | 3,173.3 | 3,192.8 | 3,173.3 | 3,192.8 | |||||||
Intangible assets | 3,088.6 | 3,123.3 | 3,088.6 | 3,123.3 | 3,204.8 | ||||||
U.S. | |||||||||||
Revenue: | |||||||||||
Revenue from Contract with Customer, Including Assessed Tax | 1,353 | 1,338.7 | 818.1 | ||||||||
Long-lived assets: | |||||||||||
Long-lived assets | 2,569.4 | 2,604.2 | 2,569.4 | 2,604.2 | |||||||
Intangible assets | 2,536 | 2,580.8 | 2,536 | 2,580.8 | |||||||
UK | |||||||||||
Revenue: | |||||||||||
Revenue from Contract with Customer, Including Assessed Tax | 602.4 | 649.4 | 669 | ||||||||
Long-lived assets: | |||||||||||
Long-lived assets | 384.8 | 366.8 | 384.8 | 366.8 | |||||||
Intangible assets | 337.5 | 324.5 | 337.5 | 324.5 | |||||||
Australia | |||||||||||
Long-lived assets: | |||||||||||
Long-lived assets | 216.1 | 219.3 | 216.1 | 219.3 | |||||||
Intangible assets | 215.1 | 218 | 215.1 | 218 | |||||||
LU | |||||||||||
Revenue: | |||||||||||
Revenue from Contract with Customer, Including Assessed Tax | 182.3 | 255.9 | 280.9 | ||||||||
International | |||||||||||
Revenue: | |||||||||||
Revenue from Contract with Customer, Including Assessed Tax | 54.7 | 62.4 | $ 50.3 | ||||||||
Other | |||||||||||
Long-lived assets: | |||||||||||
Long-lived assets | $ 3 | $ 2.5 | $ 3 | $ 2.5 |
Selected Quarterly Financial _3
Selected Quarterly Financial Data (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Selected Quarterly Financial Data | |||||||||||
Total revenue | $ 601.2 | $ 536 | $ 535.9 | $ 519.3 | $ 545.1 | $ 581.2 | $ 592.4 | $ 587.7 | $ 2,192.4 | $ 2,306.4 | $ 1,818.3 |
Operating income | 154.3 | 143.6 | 118.5 | 124.5 | 150 | 148.3 | 175.3 | 176.2 | 540.9 | 649.8 | 442.3 |
Net income | 120.4 | 113.1 | 112.3 | 99.9 | 100.8 | 105.1 | 130.5 | 163.2 | 445.7 | 499.6 | 658.4 |
Net income attributable to noncontrolling interests | 8.4 | 1 | 2.9 | 5.8 | (6) | (6.1) | (10.1) | (2) | 18.1 | (24.2) | 2.9 |
Net income attributable to JHG | $ 112 | $ 112.1 | $ 109.4 | $ 94.1 | $ 106.8 | $ 111.2 | $ 140.6 | $ 165.2 | $ 427.6 | $ 523.8 | $ 655.5 |
Basic earnings per share attributable to JHG common shareholders (in dollars per share) | $ 0.59 | $ 0.58 | $ 0.56 | $ 0.48 | $ 0.54 | $ 0.55 | $ 0.70 | $ 0.82 | $ 2.21 | $ 2.62 | $ 3.97 |
Diluted earnings per share attributable to JHG common shareholders (in dollars per share) | $ 0.59 | $ 0.58 | $ 0.56 | $ 0.48 | $ 0.54 | $ 0.55 | $ 0.70 | $ 0.82 | $ 2.21 | $ 2.61 | $ 3.93 |