Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | May 12, 2020 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2020 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Entity Registrant Name | Manning & Napier, Inc. | |
Entity Central Index Key | 0001524223 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Current Reporting Status | Yes | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 16,275,359 |
Consolidated Statements of Fina
Consolidated Statements of Financial Condition - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Assets | ||
Cash and cash equivalents | $ 75,019 | $ 67,088 |
Accounts receivable | 9,506 | 10,182 |
Investment securities | 71,043 | 90,467 |
Prepaid expenses and other assets | 13,614 | 5,607 |
Total current assets | 169,182 | 173,344 |
Property and equipment, net | 4,000 | 4,565 |
Operating lease right-of-use assets | 18,157 | 18,795 |
Net deferred tax assets, non-current | 19,311 | 20,668 |
Goodwill | 4,829 | 4,829 |
Other long-term assets | 3,821 | 4,010 |
Total assets | 219,300 | 226,211 |
Liabilities | ||
Accounts payable | 1,305 | 1,614 |
Accrued expenses and other liabilities | 20,222 | 26,201 |
Deferred revenue | 11,045 | 10,759 |
Total current liabilities | 32,572 | 38,574 |
Operating lease liabilities, non-current | 18,163 | 18,753 |
Amounts payable under tax receivable agreement, non-current | 16,411 | 17,246 |
Other long-term liabilities | 1,175 | 2,017 |
Total liabilities | 68,321 | 76,590 |
Commitments and contingencies (Note 9) | ||
Shareholders’ equity | ||
Class A common stock, $0.01 par value; 300,000,000 shares authorized; and 16,275,359 and 15,956,526 shares issued and outstanding at March 31, 2020 and December 31, 2019, respectively | 163 | 160 |
Additional paid-in capital | 198,722 | 198,516 |
Retained deficit | (37,953) | (38,478) |
Accumulated other comprehensive loss | (134) | (50) |
Total shareholders’ equity | 160,798 | 160,148 |
Noncontrolling interests | (9,819) | (10,527) |
Total shareholders’ equity and noncontrolling interests | 150,979 | 149,621 |
Total liabilities, shareholders’ equity and noncontrolling interests | $ 219,300 | $ 226,211 |
Consolidated Statements of Fi_2
Consolidated Statements of Financial Condition (Parenthetical) - $ / shares | Mar. 31, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (shares) | 300,000,000 | 300,000,000 |
Common stock, shares issued (shares) | 16,275,359 | 15,956,526 |
Common stock, shares outstanding (shares) | 16,275,359 | 15,956,526 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Revenues | ||
Revenues | $ 31,109 | $ 34,797 |
Expenses | ||
Compensation and related costs | 19,263 | 21,448 |
Distribution, servicing and custody expenses | 2,813 | 3,758 |
Other operating costs | 7,097 | 8,307 |
Total operating expenses | 29,173 | 33,513 |
Operating income | 1,936 | 1,284 |
Non-operating income (loss) | ||
Interest expense | (2) | (3) |
Interest and dividend income | 357 | 809 |
Change in liability under tax receivable agreement | (2,850) | 195 |
Net gains (losses) on investments | (1,832) | 874 |
Total non-operating income (loss) | (4,327) | 1,875 |
Income (loss) before provision for (benefit from) income taxes | (2,391) | 3,159 |
Provision for (benefit from) income taxes | (3,226) | 242 |
Net income attributable to controlling and noncontrolling interests | 835 | 2,917 |
Less: net income (loss) attributable to noncontrolling interests | (23) | 2,356 |
Net income attributable to Manning & Napier, Inc. | $ 858 | $ 561 |
Net income per share available to Class A common stock | ||
Basic (in dollars per share) | $ 0.05 | $ 0.04 |
Diluted (in dollars per share) | $ 0.01 | $ 0.03 |
Weighted average shares of Class A common stock outstanding | ||
Basic (in shares) | 15,812,951 | 14,927,265 |
Diluted (in shares) | 77,907,557 | 78,581,169 |
Wealth Management | ||
Revenues | ||
Revenues | $ 14,300 | $ 16,469 |
Institutional and Intermediary | ||
Revenues | ||
Revenues | 12,131 | 13,234 |
Distribution and shareholder servicing | ||
Revenues | ||
Revenues | 2,390 | 2,624 |
Custodial services | ||
Revenues | ||
Revenues | 1,599 | 1,745 |
Other revenue | ||
Revenues | ||
Revenues | $ 689 | $ 725 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Statement of Comprehensive Income [Abstract] | ||
Net income attributable to controlling and noncontrolling interests | $ 835 | $ 2,917 |
Net unrealized holding gains (losses) on investment securities, net of tax | (428) | 115 |
Reclassification adjustment for net realized gains on investment securities included in net income | (33) | (14) |
Comprehensive income | 374 | 3,018 |
Less: Comprehensive income attributable to noncontrolling interests | (400) | 2,436 |
Comprehensive income attributable to Manning & Napier, Inc. | $ 774 | $ 582 |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Equity - USD ($) $ in Thousands | Total | Common StockClass A common stock | Additional Paid in Capital | Retained Deficit | Accumulated Other Comprehensive Income (Loss) | Non Controlling Interests |
Beginning balance, Shares at Dec. 31, 2018 | 15,310,958 | |||||
Beginning balance at Dec. 31, 2018 | $ 146,243 | $ 153 | $ 198,604 | $ (38,865) | $ (77) | $ (13,572) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 2,917 | 561 | 2,356 | |||
Distributions to noncontrolling interests | (1,620) | (1,620) | ||||
Net changes in unrealized investment securities gains or losses | 115 | 21 | 94 | |||
Common stock issued under equity compensation plan, net of forfeitures (in shares) | 373,615 | |||||
Common stock issued under equity compensation plan, net of forfeitures | 0 | $ 4 | (4) | |||
Equity-based compensation | 1,465 | 272 | 1,193 | |||
Dividends declared on Class A common stock | (288) | (288) | ||||
Impact of changes in ownership of Manning & Napier Group, LLC | 0 | (61) | 61 | |||
Ending balance, Shares at Mar. 31, 2019 | 15,684,573 | |||||
Ending balance at Mar. 31, 2019 | 148,908 | $ 157 | 198,811 | (38,516) | (56) | (11,488) |
Beginning balance, Shares at Dec. 31, 2019 | 15,956,526 | |||||
Beginning balance at Dec. 31, 2019 | 149,621 | $ 160 | 198,516 | (38,478) | (50) | (10,527) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 835 | 858 | (23) | |||
Distributions to noncontrolling interests | 0 | 0 | ||||
Net changes in unrealized investment securities gains or losses | (428) | (84) | (344) | |||
Common stock issued under equity compensation plan, net of forfeitures (in shares) | 318,833 | |||||
Common stock issued under equity compensation plan, net of forfeitures | 0 | $ 3 | (3) | |||
Shares withheld to satisfy tax withholding requirements related to equity awards vested | (2) | 0 | (2) | |||
Equity-based compensation | 1,286 | 252 | 1,034 | |||
Dividends declared on Class A common stock | (333) | (333) | ||||
Impact of changes in ownership of Manning & Napier Group, LLC | 0 | (43) | 43 | |||
Ending balance, Shares at Mar. 31, 2020 | 16,275,359 | |||||
Ending balance at Mar. 31, 2020 | $ 150,979 | $ 163 | $ 198,722 | $ (37,953) | $ (134) | $ (9,819) |
Consolidated Statements of Sh_2
Consolidated Statements of Shareholders' Equity (Parenthetical) - $ / shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Class A common stock | ||
Cash dividends declared per share of Class A common stock | $ 0.02 | $ 0.02 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Cash flows from operating activities: | |||
Net income attributable to controlling and noncontrolling interests | $ 835 | $ 2,917 | |
Adjustment to reconcile net income to net cash provided by operating activities: | |||
Equity-based compensation | 1,286 | 1,465 | |
Depreciation and amortization | 378 | 403 | |
Change in amounts payable under tax receivable agreement | 2,850 | (195) | $ (2,850) |
Gain on sale of intangible assets | (19) | (56) | |
Net (gains) losses on investment securities | 1,832 | (874) | |
Deferred income taxes | (3,734) | 158 | |
(Increase) decrease in operating assets and increase (decrease) in operating liabilities: | |||
Accounts receivable | 676 | 695 | |
Prepaid expenses and other assets | (2,528) | (960) | |
Other long-term assets | 767 | 660 | |
Accounts payable | (309) | 134 | |
Accrued expenses and other liabilities | (9,761) | (10,458) | |
Deferred revenue | 285 | (266) | |
Other long-term liabilities | (1,534) | (500) | |
Net cash used in operating activities | (8,976) | (6,877) | |
Cash flows from investing activities: | |||
Purchase of property and equipment | 76 | ||
Purchase of property and equipment | (576) | ||
Sale of investments | 17,518 | 2,015 | |
Purchase of investments | (10,520) | (15,301) | |
Sale of intangible assets | 19 | 56 | |
Proceeds from maturity of investments | 10,165 | 17,358 | |
Net cash provided by investing activities | 17,258 | 3,552 | |
Cash flows from financing activities: | |||
Distributions to noncontrolling interests | 0 | (1,620) | |
Dividends paid on Class A common stock | (319) | (306) | |
Payment of shares withheld to satisfy withholding requirements | (2) | 0 | |
Payment of capital lease obligations | (30) | (27) | |
Net cash used in financing activities | (351) | (1,953) | |
Net increase (decrease) in cash and cash equivalents | 7,931 | (5,278) | |
Cash and cash equivalents: | |||
Beginning of period | 67,088 | 59,586 | 59,586 |
End of period | $ 75,019 | $ 54,308 | $ 67,088 |
Organization and Nature of the
Organization and Nature of the Business | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Nature of the Business | Organization and Nature of the Business Manning & Napier, Inc. ("Manning & Napier" or the "Company") provides a broad range of investment solutions through separately managed accounts, mutual funds, and collective investment trust funds, as well as a variety of consultative services that complement its investment process. Founded in 1970, the Company offers equity, fixed income and alternative strategies, as well as a range of blended asset portfolios, including life cycle funds. Headquartered in Fairport, New York, the Company serves a diversified client base of high-net-worth individuals and institutions, including 401(k) plans, pension plans, Taft-Hartley plans, endowments and foundations. The Company was incorporated in 2011 as a Delaware corporation, and is the sole managing member of Manning & Napier Group, LLC and its subsidiaries (“Manning & Napier Group”), a holding company for the investment management businesses conducted by its operating subsidiaries. The diagram below depicts the Company's organizational structure as of March 31, 2020 . (1) The consolidated operating subsidiaries of Manning & Napier Group include Manning & Napier Advisors, LLC ("MNA"), Manning & Napier Information Services, LLC, Manning & Napier Investor Services, Inc., Exeter Trust Company and Rainier Investment Management, LLC ("Rainier"). |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Critical Accounting Policies The Company's critical accounting policies and estimates are disclosed in its Annual Report on Form 10-K for the year ended December 31, 2019 . The Company believes that the disclosures herein are adequate so that the information presented is not misleading; however, these financial statements should be read in conjunction with the financial statements and the notes thereto in the Company's Annual Report on Form 10-K for the year ended December 31, 2019 . The financial data for the interim periods may not necessarily be indicative of results for future interim periods or for the full year. Basis of Presentation The accompanying unaudited consolidated financial statements were prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and related rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) for interim financial reporting and include all adjustments, consisting only of normal recurring adjustments which are, in the opinion of management, necessary for a fair statement of the results for the interim period. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates or assumptions that affect the reported amounts and disclosures in the consolidated financial statements. Actual results could differ from these estimates or assumptions. Summary of Presentation Changes As of January 1, 2020, the Company revised its presentation of investment management revenue within its consolidated statements of operations. Investment management revenue, previously presented by investment vehicle, has been disaggregated to present investment management revenue by sales channel. Concurrently, the Company revised the presentation of assets under management ("AUM") activity previously reported by investment vehicle to present this activity by sales channel. Amounts for the comparative prior periods have been reclassified to conform to the current period presentation. These reclassifications had no impact on previously reported net income and do not represent a restatement of any previously published financial results. Principles of Consolidation The Company consolidates all majority-owned subsidiaries. In addition, as of March 31, 2020 , Manning & Napier holds an economic interest of approximately 19.5% in Manning & Napier Group but, as managing member, controls all of the business and affairs of Manning & Napier Group. As a result, the Company consolidates the financial results of Manning & Napier Group and records a noncontrolling interest on its consolidated statements of financial condition with respect to the remaining economic interest in Manning & Napier Group held by Manning & Napier Group Holdings, LLC (“M&N Group Holdings”) and Manning & Napier Capital Company, LLC (“MNCC”). All material intercompany transactions have been eliminated in consolidation. In accordance with Accounting Standards Update ("ASU") 2015-02, Consolidation (Topic 810) – Amendments to the Consolidation Analysis , the determination of whether a company is required to consolidate an entity is based on, among other things, an entity’s purpose and design, a company’s ability to direct the activities of the entity that most significantly impact the entity’s economic performance, and whether a company is obligated to absorb losses or receive benefits that could potentially be significant to the entity. The standard also requires ongoing assessments of whether a company is the primary beneficiary of a variable interest entity (“VIE”). When utilizing the voting interest entity ("VOE") model, controlling financial interest is generally defined as majority ownership of voting interests. The Company provides seed capital to its investment teams to develop new strategies and services for its clients. The original seed investment may be held in a separately managed account, comprised solely of the Company's investments or within a mutual fund, where the Company's investments may represent all or only a portion of the total equity investment in the mutual fund. Pursuant to U.S. GAAP, the Company evaluates its investments in mutual funds on a regular basis and consolidates such mutual funds for which it holds a controlling financial interest. When no longer deemed to hold a controlling financial interest, the Company would deconsolidate the fund and classify the remaining investment as either an equity method investment, equity investments, at fair value, or as trading securities, as applicable. As of March 31, 2020 and December 31, 2019 , the Company did not have investments classified as an equity method investment. The Company serves as the investment adviser for Manning & Napier Fund, Inc. series of mutual funds (the “Fund”), Exeter Trust Company Collective Investment Trusts (“CIT”) and Rainier Multiple Investment Trust. The Fund, CIT and Rainier Multiple Investment Trust are legal entities, the business and affairs of which are managed by their respective boards of directors. As a result, each of these entities is a VOE. The Company holds, in limited cases, direct investments in a mutual fund (which are made on the same terms as are available to other investors) and consolidates each of these entities where it has a controlling financial interest or a majority voting interest. The Company's investments in the Fund amounted to approximately $2.6 million as of March 31, 2020 and $3.2 million as of December 31, 2019 . As of March 31, 2020 and December 31, 2019 , the Company did not have a controlling financial interest in any mutual fund. Revenue Investment Management: Investment management fees are computed as a percentage of AUM. The Company's performance obligation is a series of services that form part of a single performance obligation satisfied over time. Separately managed accounts are paid in advance, typically for a semi-annual or quarterly period, or in arrears, typically for a monthly or quarterly period. When investment management fees are paid in advance, the Company defers the revenue as a contract liability and recognizes it over the applicable period. When investment management fees are paid in arrears, the Company estimates revenue and records a contract asset (accrued accounts receivable) based on AUM as of the most recent month end date. Mutual funds and collective investment trust investment management revenue is calculated and earned daily based on AUM. Revenue is presented net of cash rebates and fees waived pursuant to contractual expense limitations of the funds. The Company also has agreements with third parties who provide recordkeeping and administrative services for employee benefit plans participating in the collective investment trusts. The Company is acting as an agent on behalf of the employee benefit plan sponsors, therefore, investment management revenue is recorded net of fees paid to third party service providers. Distribution and shareholder servicing: The Company receives distribution and servicing fees for providing services to its affiliated mutual funds. Revenue is computed and earned daily based on a percentage of AUM. The performance obligation is a series of services that form part of a single performance obligation satisfied over time. The Company has agreements with third parties who provide distribution and administrative services for its mutual funds. The agreements are evaluated to determine whether revenue should be reported gross or net of payments to third-party service providers. The Company controls the services provided and acts as a principal in the relationship. Therefore, distribution and shareholder servicing revenue is recorded gross of fees paid to third parties. Custodial services: Custodial service fees are calculated as a percentage of the client’s market value with additional fees charged for certain transactions. For the safeguarding and administrative services that are subject to a percentage of market value fee, the Company's performance obligation is a series of services that form part of a single performance obligation satisfied over time. Revenue for transactions assigned a stand-alone selling price is recognized in the period in which the transaction is executed. Custodial service fees are billed monthly in arrears. The Company has agreements with third parties who provide safeguarding, recordkeeping and administrative services for their clients. The Company controls the services provided and acts as a principal in the relationship. Therefore, custodial service revenue is recorded gross of fees paid to third parties. Cash and Cash Equivalents The Company generally considers all highly liquid investments with original maturities of three months or less to be cash equivalents. Cash and cash equivalents are primarily held in operating accounts at major financial institutions and also in money market securities. Cash equivalents are stated at cost, which approximates market value due to the short-term maturity of these investments. The fair value of cash equivalents has been classified as Level 1 in accordance with the fair value hierarchy. Investment Securities Investment securities are classified as either trading, equity method investments or available-for-sale and are carried at fair value. Fair value is determined based on quoted market prices in active markets for identical or similar instruments. Investment securities classified as equity investments, at fair value consist of equity securities and investments in mutual funds for which the Company provides advisory services. Realized and unrealized gains and losses on equity investments, at fair value or trading securities, as applicable, are recorded in net gains (losses) on investments in the consolidated statements of operations. At March 31, 2020 , equity investments, at fair value consist of investments held by the Company to provide initial cash seeding for product development purposes and investments to hedge economic exposure to market movements on its deferred compensation plan. Investment securities classified as available-for-sale consist of U.S. Treasury notes, corporate bonds and other short-term investments. Unrealized gains and losses on available-for-sale securities are excluded from earnings and are reported, net of deferred income tax, as a separate component of accumulated other comprehensive income in shareholders’ equity until realized. The Company periodically reviews each individual security position that has an unrealized loss, or impairment, to determine if that impairment is other-than-temporary. If impairment is determined to be other-than-temporary, the carrying value of the security will be written down to fair value and the loss will be recognized in earnings. Realized gains and losses on sales of available-for-sale securities are computed on a specific identification basis and are recorded in net gains (losses) on investments in the consolidated statements of operations. Property and Equipment Property and equipment is presented net of accumulated depreciation of approximately $11.8 million and $11.4 million as of March 31, 2020 and December 31, 2019 , respectively. Goodwill and Intangible Assets Goodwill represents the excess cost over the fair value of the identifiable net assets of acquired companies. Identifiable intangible assets generally represent the cost of client relationships and investment management agreements acquired as well as trademarks. Goodwill and indefinite-lived assets are tested for impairment annually or more frequently if events or circumstances indicate that the carrying value may not be recoverable. Intangible assets subject to amortization are tested for impairment whenever events or circumstances indicate that the carrying value may not be recoverable. Goodwill and intangible assets require significant management estimate and judgment, including the valuation and expected life determination in connection with the initial purchase price allocation and the ongoing evaluation for impairment. Leases The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use ("ROU") assets, accrued expenses and other liabilities and operating lease liabilities, non-current on its consolidated statements of financial condition. Finance leases are included in other long-term assets, accrued expenses and other liabilities, and other long-term liabilities on its consolidated statements of financial condition. ROU assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent the Company's obligation to make lease payments arising from the lease. Operating lease ROU assets and lease liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As the Company's leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The incremental borrowing rate, for each identified lease, is the rate of interest that the Company would have to pay to borrow on a collateralized basis over a similar term. The operating lease ROU asset is reduced for any lease incentives. The Company's lease terms may include options to extend or terminate the lease when it is reasonably certain that it will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease and non-lease components, which are combined for all classes of underlying assets. Operating Segments The Company operates in one segment, the investment management industry. Recent Accounting Pronouncements In August 2018, the Financial Accounting Standards Board ("FASB") issued ASU 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract . The amendment aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements that currently exist in U.S. GAAP for capitalizing implementation costs incurred to develop or obtain internal-use software. Under the new standard, implementation costs are deferred and presented in the same financial statement caption on the consolidated statements of financial condition as a prepayment of related arrangement fees. The deferred costs are recognized over the term of the arrangement in the same financial statement caption in the consolidated statements of operations as the related fees of the arrangement. The Company adopted the provisions of this guidance using the prospective adoption approach, which does not require the restatement of prior years. The adoption of this ASU did not have a material impact on the Company's statement of operations as requirements under the standard are generally consistent with its previous accounting for cloud computing arrangements, with the primary difference being the classification of certain information in its statements of financial condition and related disclosures. As of March 31, 2020 , the Company had a total of approximately $2.3 million of capitalized implementation costs for hosting arrangements within prepaid expenses and other assets on its statements of financial condition, with no amounts in accumulated amortization and no amortization expense recognized during the three months ended March 31, 2020. At December 31, 2019, approximately $0.4 million of these costs were capitalized within property and equipment, net. The hosting arrangements that are service contracts include internal and external costs related to various technology additions in support of the Company's business. Amortization costs are recorded on a straight-line basis over the term of the hosting arrangement agreement. In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment , which simplifies the accounting for goodwill impairments by eliminating step two from the goodwill impairment test. The ASU requires goodwill impairments to be measured on the basis of the fair value of the reporting unit relative to the reporting unit's carrying amount rather than on the basis of the implied amount of goodwill relative to the goodwill balance of the reporting unit. The adoption of this ASU had did not have a material impact on the Company's consolidated financial statements. |
Revenue
Revenue | 3 Months Ended |
Mar. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue Disaggregated Revenue The following table represents the Company’s wealth management and institutional and intermediary investment management revenue by investment portfolio during the three months ended March 31, 2020 and 2019 : Three months ended March 31, 2020 Three months ended March 31, 2019 Wealth Management Institutional and Intermediary Total Wealth Management Institutional and Intermediary Total (in thousands) Blended Asset $ 11,942 $ 8,186 $ 20,128 $ 13,498 $ 7,828 $ 21,326 Equity 2,165 3,619 5,784 2,761 4,957 7,718 Fixed Income 193 326 519 210 449 659 Total $ 14,300 $ 12,131 $ 26,431 $ 16,469 $ 13,234 $ 29,703 Accounts Receivable Accounts receivable as of March 31, 2020 and December 31, 2019 consisted of the following: March 31, 2020 December 31, 2019 (in thousands) Accounts receivable - third parties $ 5,787 $ 5,778 Accounts receivable - affiliated mutual funds and collective investment trusts 3,719 4,404 Total accounts receivable $ 9,506 $ 10,182 Accounts receivable represents the Company's unconditional rights to consideration arising from its performance under separately managed account, mutual fund and collective investment trust, distribution and shareholder servicing, and custodial service contracts. Accounts receivable balances do not include an allowance for doubtful accounts nor has any significant bad debt expense attributable to accounts receivable been recorded during the three months ended March 31, 2020 or 2019 . Advisory and Distribution Agreements The Company earns investment advisory fees, distribution fees and administrative service fees under agreements with affiliated mutual funds and collective investment trusts. Fees earned for advisory and distribution services provided were approximately $8.9 million for the three months ended March 31, 2020 , and approximately $11.1 million for the three months ended March 31, 2019 , which represents greater than 25% of revenue in each period. The following provides amounts due from affiliated mutual funds and collective investment trusts reported within accounts receivable in the consolidated statements of financial condition as of March 31, 2020 and December 31, 2019 : March 31, 2020 December 31, 2019 (in thousands) Affiliated mutual funds $ 2,682 $ 3,164 Affiliated collective investment trusts 1,037 1,240 Accounts receivable - affiliated mutual funds and collective investment trusts $ 3,719 $ 4,404 Contract assets and liabilities Accrued accounts receivable : Accrued accounts receivable represents the Company's contract asset for revenue that has been recognized in advance of billing separately managed account contracts. Consideration for the period billed in arrears is dependent on the client’s AUM on a future billing date and therefore conditional as of the reporting period end. During the three months ended March 31, 2020 , revenue was decreased by less than $0.1 million for changes in transaction price. Accrued accounts receivable of approximately $0.2 million and $0.3 million is reported within prepaid expenses and other assets in the consolidated statements of financial condition as of March 31, 2020 and December 31, 2019 , respectively. Deferred revenue: Deferred revenue is recorded when consideration is received or unconditionally due in advance of providing services to the Company's customer. Revenue recognized during the three months ended March 31, 2020 that was included in deferred revenue at the beginning of the period was approximately $8.3 million . Costs to obtain a contract: Under compensation plans in effect for periods prior to January 1, 2020, certain incremental first year commissions directly associated with new customer contracts were capitalized and amortized on a straight-line basis over an estimated customer contract period of 3 to 7 years . The total net asset as of both March 31, 2020 and December 31, 2019 was approximately $1.0 million . The related amortization expense, which is included in compensation and related costs, totaled approximately $0.1 million for both of the three month periods ended March 31, 2020 and 2019. An impairment loss is recorded for contract acquisition costs related to client contracts that cancel during the period. These impairment losses totaled less than $0.1 million for both the three months ended March 31, 2020 and 2019. |
Noncontrolling Interests
Noncontrolling Interests | 3 Months Ended |
Mar. 31, 2020 | |
Noncontrolling Interest [Abstract] | |
Noncontrolling Interests | Noncontrolling Interests Manning & Napier holds an economic interest of approximately 19.5% in Manning & Napier Group, but as managing member controls all of the business and affairs of Manning & Napier Group. As a result, the Company consolidates the financial results of Manning & Napier Group and records a noncontrolling interest on its consolidated statements of financial condition with respect to the remaining approximately 80.5% economic interest in Manning & Napier Group held by M&N Group Holdings and MNCC. Net income attributable to noncontrolling interests on the statements of operations represents the portion of earnings attributable to the economic interest in Manning & Napier Group held by the noncontrolling interests. The following table provides a reconciliation from “Income (loss) before provision for (benefit from) income taxes” to “Net income attributable to Manning & Napier, Inc.”: Three months ended March 31, 2020 2019 (in thousands) Income (loss) before provision for (benefit from) income taxes $ (2,391 ) $ 3,159 Less: income (loss) before provision for (benefit from) income taxes of Manning & Napier, Inc. (1) (2,866 ) 191 Income before provision for (benefit from) income taxes, as adjusted 475 2,968 Controlling interest percentage (2) 19.5 % 18.6 % Net income attributable to controlling interest 93 552 Plus: income (loss) before provision for (benefit from) income taxes of Manning & Napier, Inc. (1) (2,866 ) 191 Income (loss) before provision for (benefit from) income taxes attributable to Manning & Napier, Inc. (2,773 ) 743 Less: provision for (benefit from) income taxes of Manning & Napier, Inc. (3) (3,631 ) 182 Net income attributable to Manning & Napier, Inc. $ 858 $ 561 ________________________ (1) Manning & Napier, Inc. incurs certain income or expenses that are only attributable to it and are therefore excluded from the net income attributable to noncontrolling interests. (2) Income before provision for (benefit from) income taxes is allocated to the controlling interest based on the percentage of units of Manning & Napier Group held by Manning & Napier, Inc. The amount represents the Company's weighted ownership of Manning & Napier Group for the respective periods. (3) The consolidated provision for income taxes is equal to the sum of (i) the provision for income taxes for entities other than Manning & Napier, Inc. and (ii) the provision for income taxes of Manning & Napier, Inc. which includes all U.S. federal and state income taxes. The consolidated provision for (benefit from) income taxes was a benefit of $3.2 million and provision of $0.2 million for the three months ended March 31, 2020 and March 31, 2019 , respectively. As of March 31, 2020 , a total of 62,034,200 units of Manning & Napier Group were held by the noncontrolling interests. Pursuant to the terms of the exchange agreement entered into at the time of the Company's initial public offering ("Exchange Agreement"), such units may be tendered for exchange. For any units exchanged, the Company will (i) pay an amount of cash equal to the number of units exchanged multiplied by the value of one share of the Company's Class A common stock less a market discount and expected expenses, or, at the Company's election, (ii) issue shares of the Company's Class A common stock on a one-for-one basis, subject to customary adjustments. As the Company receives units of Manning & Napier Group that are exchanged, the Company's ownership of Manning & Napier Group will increase. Refer to Note 14 for further discussion regarding an exchange of units that settled subsequent to March 31, 2020. During the three months ended March 31, 2020 , Class A common stock was issued under the Company's 2011 Equity Compensation Plan (the "Equity Plan") for which Manning & Napier, Inc. acquired an equivalent number of Class A units of Manning & Napier Group. The following is the impact to the Company's equity ownership interest in Manning & Napier Group for the three months ended March 31, 2020 : Manning & Napier Group Class A Units Held Manning & Napier Total Manning & Napier Ownership % As of December 31, 2019 14,750,221 62,034,200 76,784,421 19.2% Class A Units issued 318,833 — 318,833 0.3% Class A Units exchanged — — — —% As of March 31, 2020 15,069,054 62,034,200 77,103,254 19.5% Since the Company continues to have a controlling interest in Manning & Napier Group, the aforementioned changes in ownership of Manning & Napier Group were accounted for as equity transactions under ASC 810, Consolidation . Additional paid-in capital and noncontrolling interests in the consolidated statements of financial position are adjusted to reallocate the Company's historical equity to reflect the change in ownership of Manning & Napier Group. At March 31, 2020 and December 31, 2019 , the Company had recorded a liability of $20.4 million and $17.5 million , respectively, representing the estimated payments due to the selling unit holders under the tax receivable agreement ("TRA") entered into between Manning & Napier and the other holders of Class A Units of Manning & Napier Group. Of these amounts, approximately $4.0 million and $0.3 million were included in accrued expenses and other liabilities at March 31, 2020 and December 31, 2019 , respectively. The Company made no payments pursuant to the TRA during either of the three months ended March 31, 2020 and 2019. Refer to Note 12 for further discussion surrounding the amounts payable under the TRA. Obligations pursuant to the TRA are obligations of Manning & Napier. They do not impact the noncontrolling interests. These obligations are not income tax obligations. Furthermore, the TRA has no impact on the allocation of the provision for income taxes to the Company’s net income. |
Investment Securities
Investment Securities | 3 Months Ended |
Mar. 31, 2020 | |
Investments [Abstract] | |
Investment Securities | Investment Securities The following represents the Company’s investment securities holdings as of March 31, 2020 and December 31, 2019 : March 31, 2020 Cost Unrealized Gains Unrealized Losses Fair Value (in thousands) Available-for-sale securities U.S. Treasury notes $ 33,270 $ 409 $ — $ 33,679 Fixed income securities 23,089 — (734 ) 22,355 Short-term investments 7,405 — — 7,405 63,439 Equity investments, at fair value Equity securities 5,044 Mutual funds 2,560 7,604 Total investment securities $ 71,043 December 31, 2019 Cost Unrealized Gains Unrealized Losses Fair Value (in thousands) Available-for-sale securities U.S. Treasury notes $ 33,908 $ 193 $ — $ 34,101 Fixed income securities 35,148 — (91 ) 35,057 Short-term investments 12,119 — — 12,119 81,277 Equity investments, at fair value Equity securities 6,038 Mutual funds 3,152 9,190 Total investment securities $ 90,467 Investment securities are classified as either equity investments or available-for-sale and are carried at fair value. Fair value is determined based on quoted market prices in active markets for identical or similar instruments. Investment securities classified as equity investments, at fair value consist of equity securities and investments in mutual funds for which the Company provides advisory services. At March 31, 2020 and December 31, 2019 , equity investments, at fair value consist of investments held by the Company to provide initial cash seeding for product development purposes and investments in mutual funds to hedge economic exposure to market movements on its deferred compensation plan. The Company recognized approximately $1.8 million of net unrealized losses and $0.9 million of net unrealized gains related to investments classified as equity investments, at fair value during the three months ended March 31, 2020 and 2019 , respectively. Investment securities classified as available-for-sale consist of U.S. Treasury notes, corporate bonds and other short-term investments to optimize cash management opportunities and for compliance with certain regulatory requirements. As of March 31, 2020 and December 31, 2019 , approximately $0.6 million of these securities was considered restricted. The Company periodically reviews each individual security position that has an unrealized loss, or impairment, to determine if that impairment is other-than-temporary. No other-than-temporary impairment charges have been recognized by the Company during the three months ended March 31, 2020 and 2019 . |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Fair value is defined as the price that the Company would receive upon selling an investment in an orderly transaction to an independent buyer in the principal or most advantageous market of the investment. A fair value hierarchy is applied that gives the highest priority to unadjusted quoted prices in active markets for identical assets and liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The following three-tier fair value hierarchy prioritizes the inputs used in measuring fair value: • Level 1—observable inputs such as quoted prices in active markets for identical securities; • Level 2—other significant observable inputs (including but not limited to quoted prices for similar securities, interest rates, prepayment rates, credit risk, etc.); and • Level 3—significant unobservable inputs (including the Company’s own assumptions in determining the fair value of investments). The following table summarizes the hierarchy of inputs used to derive the fair value of the Company’s assets as of March 31, 2020 and December 31, 2019 : March 31, 2020 Level 1 Level 2 Level 3 Totals (in thousands) Equity securities $ 5,044 $ — $ — $ 5,044 Fixed income securities — 22,355 — 22,355 Mutual funds 2,560 — — 2,560 U.S. Treasury notes — 33,679 — 33,679 Short-term investments — 7,405 — 7,405 Total assets at fair value $ 7,604 $ 63,439 $ — $ 71,043 December 31, 2019 Level 1 Level 2 Level 3 Totals (in thousands) Equity securities $ 6,038 $ — $ — $ 6,038 Fixed income securities — 35,057 — 35,057 Mutual funds 3,152 — — 3,152 U.S. Treasury notes — 34,101 — 34,101 Short-term investments — 12,119 — 12,119 Total assets at fair value $ 9,190 $ 81,277 $ — $ 90,467 Short-term investments consists of U.S. Treasury bills. Valuations of investments in fixed income securities, U.S. Treasury notes and U.S. Treasury bills can generally be obtained through independent pricing services. For most bond types, the pricing service utilizes matrix pricing, which considers one or more of the following factors: yield or price of bonds of comparable quality, coupon, maturity, current cash flows, type and current day trade information, as well as dealer supplied prices. These valuations are categorized as Level 2 in the hierarchy. The Company’s policy is to recognize transfers in and transfers out of the valuation levels as of the beginning of the reporting period. There were no transfers between valuation levels during the three months ended March 31, 2020 . |
Accrued Expenses and Other Liab
Accrued Expenses and Other Liabilities | 3 Months Ended |
Mar. 31, 2020 | |
Accounts Payable and Accrued Liabilities [Abstract] | |
Accrued Expenses and Other Liabilities | Accrued Expenses and Other Liabilities Accrued expenses and other liabilities as of March 31, 2020 and December 31, 2019 consisted of the following: March 31, 2020 December 31, 2019 (in thousands) Accrued bonus and sales commissions $ 6,176 $ 14,825 Accrued payroll and benefits 2,914 4,415 Accrued sub-transfer agent fees 384 420 Dividends payable on Class A common stock 326 312 Amounts payable under tax receivable agreement 3,960 275 Short-term operating lease liabilities 2,772 2,682 Other accruals and liabilities 3,690 3,272 Total accrued expenses and other liabilities $ 20,222 $ 26,201 |
Leases
Leases | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Leases | Leases Leases The Company has operating and finance leases for office space and certain equipment. For these leases, the office space or equipment is an explicitly identified asset within the contract. The Company has determined that it has obtained substantially all of the economic benefits from the use of the underlying asset and directs how and for what purpose the asset is used during the term of the contract. The Company's leases have remaining lease terms ranging between approximately 1 year and 8 years. The Company's lease term on certain of its multi-year office space leases, including its headquarters, include options for the Company to extend those leases for periods ranging from an additional five to ten years. In addition, the Company has the option to reduce a portion of its square footage at certain times throughout the term of the lease for its headquarters. The Company determined it is not reasonably certain at this time it will exercise the options to extend these leases or will exercise the options to reduce its square footage; therefore, the payment amounts related to these lease term extensions and contraction options have been excluded from determining its ROU asset and lease liability. Certain of the Company's operating leases for office space include variable lease payments, including non-lease components (such as utilities and operating expenses) that vary based on actual expenses and are adjusted on an annual basis. The Company concluded that these variable lease payments are in substance fixed payments and included the estimated variable payments in its determination of ROU assets and lease liabilities. Changes in the lease terms, including renewal options and options to reduce its square footage, incremental borrowing rates, and/or variable lease payments, and the corresponding impact to the ROU assets and lease liabilities, are recognized in the period incurred. Certain of the Company's operating leases have been subleased for which the Company will receive cash totaling approximately $3.8 million over the remaining term of such leases. The lease terms for the three subleased operating leases end in 2021, 2027 and 2028. The components of lease expense for the three months ended March 31, 2020 and 2019 were as follows: Three months ended March 31, 2020 2019 (in thousands) Finance lease expense Amortization of right-of-use assets $ 25 29 Interest on lease liabilities 2 3 Operating lease expense 792 923 Short-term lease expense 1 4 Variable lease expense 75 46 Sublease income (166 ) (123 ) Total lease expense $ 729 882 Supplemental cash flow information related to leases for the three months ended March 31, 2020 and 2019 were as follows: Three months ended March 31, 2020 2019 (in thousands) Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from finance leases $ 2 3 Finance cash flows from finance leases $ 27 27 Operating cash flows from operating leases $ 720 794 Right-of-use assets obtained in exchange for new lease obligations: Finance leases $ — 163 Operating leases $ 136 — Supplemental balance sheet information related to leases as of March 31, 2020 was as follows: (in thousands, except lease term and discount rate) March 31, 2020 Finance Leases Finance lease right-of-use assets (1) $ 174 Accrued expenses and other liabilities $ 80 Other long-term liabilities 104 Total finance lease liabilities $ 184 Operating Leases Operating lease right-of-use assets $ 18,157 Accrued expenses and other liabilities $ 2,772 Operating lease liabilities, non-current 18,163 Total operating lease liabilities $ 20,935 Weighted average remaining lease term Finance leases 2.73 years Operating leases 7.18 years Weighted average discount rate Finance leases 4.81 % Operating leases 5.13 % _______________________ (1) Amounts included in other long-term assets within the consolidated statements of financial condition. Maturities of lease liabilities were as follows: Twelve month period ending March 31, Finance Leases Operating Leases (in thousands) 2021 $ 87 $ 3,717 2022 57 3,726 2023 33 3,504 2024 20 3,136 2025 — 3,030 Thereafter — 7,929 Total lease payments 197 25,042 Less imputed interest (13 ) (4,107 ) Total lease liabilities $ 184 $ 20,935 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies The Company may from time to time enter into agreements that contain certain representations and warranties and which provide general indemnifications. The Company may also serve as a guarantor of such obligations. The Company’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Company that have not yet occurred. The Company expects any risk of liability associated with such guarantees to be remote. Regulation As an investment adviser to a variety of investment products, the Company and its affiliated broker-dealer are subject to routine reviews and inspections by the SEC and the Financial Industry Regulatory Authority, Inc. Additionally, the Company could be subject to non-routine reviews and inspections by the National Futures Association and U.S. Commodity Futures Trading Commission in regards to the Company’s de minimis exposure to commodity interest investments in the mutual funds and collective investment trust vehicles it operates. From time to time the Company may also be subject to claims, or be involved in various legal proceedings, arising in the ordinary course of its business and other contingencies. The Company does not believe that the outcome of any of these reviews, inspections or other legal proceedings will have a material impact on its consolidated financial statements; however, litigation is subject to many uncertainties, and the outcome of individual litigated matters is difficult to predict. The Company will establish accruals for matters that are probable, can be reasonably estimated, and may take into account any related insurance recoveries to the extent of such recoveries. As of March 31, 2020 and December 31, 2019 , the Company has not accrued for any such claims, legal proceedings, or other contingencies. |
Earnings per Common Share
Earnings per Common Share | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings per Common Share | Earnings per Common Share Basic earnings per share (“basic EPS”) is computed using the two-class method to determine net income available to Class A common stock. The two-class method includes an earnings allocation formula that determines earnings per share for each participating security according to dividends declared and undistributed earnings for the period. The Company's restricted Class A common shares granted under the Equity Plan have non-forfeitable dividend rights during their vesting period and are therefore considered participating securities under the two-class method. Under the two-class method, the Company's net income available to Class A common stock is reduced by the amount allocated to the unvested restricted Class A common stock. Basic EPS is calculated by dividing net income available to Class A common stock by the weighted average number of common shares outstanding during the period. Diluted earnings per share (“diluted EPS”) is computed under the more dilutive of either the treasury method or the two-class method. For the diluted calculation, the weighted average number of common shares outstanding during the period is increased by the assumed conversion into Class A common stock of the unvested equity awards and the exchangeable Class A units of Manning & Napier Group, to the extent that such conversion would dilute earnings per share. The following is a reconciliation of the income and share data used in the basic and diluted EPS computations for the three months ended March 31, 2020 and 2019 under the two-class method: Three months ended March 31, 2020 2019 (in thousands, except share data) Net income attributable to controlling and noncontrolling interests $ 835 $ 2,917 Less: net income (loss) attributable to noncontrolling interests (23 ) 2,356 Net income attributable to Manning & Napier, Inc. $ 858 $ 561 Less: allocation to participating securities 13 (5 ) Net income available to Class A common stock $ 845 $ 566 Weighted average shares of Class A common stock outstanding - basic 15,812,951 14,927,265 Dilutive effect of unvested equity awards 60,406 304,183 Dilutive effect of exchangeable Class A Units 62,034,200 63,349,721 Weighted average shares of Class A common stock outstanding - diluted 77,907,557 78,581,169 Net income available to Class A common stock per share - basic $ 0.05 $ 0.04 Net income available to Class A common stock per share - diluted $ 0.01 $ 0.03 For the three months ended March 31, 2020 and 2019 , 3,000,000 unvested performance-based stock options were excluded from the calculation of diluted EPS because the associated market condition had not yet been achieved. For the three months ended March 31, 2020 and 2019 , 1,276,391 and 1,413,560 , respectively, unvested equity awards were excluded from the calculation of diluted EPS because the effect would have been anti-dilutive. |
Equity Based Compensation
Equity Based Compensation | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Compensation [Abstract] | |
Equity Based Compensation | Equity Based Compensation The Equity Plan was adopted by the Company's board of directors and approved by shareholders prior to the consummation of the Company's 2011 initial public offering. Under the Equity Plan, a total of 13,142,813 equity interests are authorized for issuance, and may be issued in the form of Class A common stock, restricted stock units, stock options, units of Manning & Napier Group, or certain classes of membership interests in the Company which may convert into units of Manning & Napier Group. The following table summarizes activity related to awards of restricted stock and restricted stock units (collectively, "stock awards") under the Equity Plan for the three months ended March 31, 2020 : Stock Awards Weighted Average Grant Date Fair Value Outstanding at January 1, 2020 1,037,901 $ 4.30 Granted 2,997,940 $ 1.58 Vested (321,665 ) $ 1.64 Forfeited (2,667 ) $ 1.67 Outstanding at March 31, 2020 3,711,509 $ 2.34 The weighted average fair value of stock awards granted during the three months ended March 31, 2020 was $1.58 , based on the closing sale price of the Company's Class A common stock as reported on the New York Stock Exchange on the date of grant, and, if not entitled to dividends or dividend equivalents during the vesting period, reduced by the present value of such amounts expected to be paid on the underlying shares during the requisite service period. For the three months ended March 31, 2020 and 2019, the Company recorded approximately $1.1 million and $1.4 million , respectively, of compensation expense related to stock awards under the Equity Plan. The aggregate intrinsic value of stock awards that vested during the three months ended March 31, 2020 and 2019 was approximately $0.5 million and $1.0 million , respectively. As of March 31, 2020 , there was unrecognized compensation expense of approximately $6.3 million related to stock awards, which the Company expects to recognize over a weighted average period of approximately 3.5 years . In connection with the vesting of restricted stock units during the three months ended March 31, 2020 , the Company withheld a total of 2,832 shares of Class A common stock to satisfy less than $0.1 million of employee income tax withholding requirements. These net share settlements had the effect of shares repurchased and retired by the Company, as they reduced the total number of Class A common shares outstanding. A summary of activity under the Equity Plan related to stock option awards during the three months ended March 31, 2020 is presented below: Stock Option Awards Weighted Average Exercise Price Weighted Average Contractual Term (years) Aggregate Intrinsic Value (in thousands) Outstanding at January 1, 2020 3,500,000 $ 2.01 Granted — $ — Vested (166,666 ) $ 2.01 Forfeited — $ — Outstanding at March 31, 2020 3,333,334 $ 2.01 4.1 $ — Exercisable at March 31, 2020 166,666 $ 2.01 For both of the three month periods ended March 31, 2020 and 2019, the Company recorded approximately $0.1 million of compensation expense related to stock options under the Equity Plan. As of March 31, 2020 , there was unrecognized compensation expense of approximately $0.8 million related to stock options, which the Company expects to recognize over a weighted average period of approximately 0.9 years . |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company is comprised of entities that have elected to be treated as either a limited liability company ("LLC") or a “C-Corporation". As such, the entities functioning as LLCs are not liable for or able to benefit from U.S. federal and most state income taxes on their earnings, and earnings (losses) will be included in the personal income tax returns of each entity’s unit holders. The entities functioning as C-Corporations are liable for or able to benefit from U.S. federal and state and local income taxes on their earnings and losses, respectively. On March 27, 2020, the U.S. government enacted the Coronavirus Aid, Relief, and Economic Security Act ("CARES Act") which includes, among other things, the ability to carryback net operating losses from 2018, 2019 and 2020 to prior years. As of December 31, 2019, the Company had approximately $12.1 million net operating losses available to offset future taxable income for federal income tax purposes and approximately $6.1 million for state income tax purposes. The Company expects to carryback net operating losses generated in 2018, 2019 and 2020 to prior years and claim refunds when the federal corporate tax rate was 34% compared to the current statutory rates of 21%. The Company recognized an income tax benefit of approximately $3.3 million , related to the favorable rate applied to its net operating losses. As a result, the Company increased its deferred tax asset related to the TRA, resulting in a $2.9 million increase of the liability, representing 85% of the applicable cash savings. The Company’s income tax provision (benefit) and effective tax rate were as follows: Three months ended March 31, 2020 2019 (in thousands) Income (loss) before provision for (benefit from) income taxes $ (2,391 ) $ 3,159 Effective tax rate 134.9 % 7.7 % Provision for (benefit from) income taxes (3,226 ) 242 Provision for (benefit from) income taxes at statutory rate (502 ) 663 Difference between tax at effective vs. statutory rate $ (2,724 ) $ (421 ) For both the three months ended March 31, 2020 and 2019 , the difference between the Company’s recorded provision (benefit) and the provision that would result from applying the U.S. statutory rate of 21% includes the benefit resulting from the fact that a significant portion of the Company’s operations include a series of flow-through entities which are generally not subject to federal and most state income taxes. Accordingly, a portion of the Company’s earnings are not subject to corporate level taxes. For the three months ended March 31, 2020 , the income tax benefit also includes the impact from the enactment of the CARES Act, which resulted in the recognition of an income tax benefit based on the ability to carry back net operating losses to prior years. A specific state is currently auditing the Company's 2016 and 2017 corporate tax returns. The audit is expected to be completed in 2020. As of March 31, 2020, the audit is in process and the state is collecting and evaluating the data for which the Company has not recorded a liability for uncertain tax positions under ASC 740. The Company believes any potential increases to this liability, which could be up to approximately $1.2 million , would not result in a material change to its financial position. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2020 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions Transactions with noncontrolling members From time to time, the Company may be asked to provide certain services, including accounting, legal and other administrative functions for the noncontrolling members of Manning & Napier Group. While immaterial, the Company has not received any reimbursement for such services. The Company manages the personal funds of certain of the Company's executive officers and directors and/or their affiliated entities. Pursuant to the respective investment management agreements, in some instances the Company may waive or reduce its regular advisory fees for these accounts. The aggregate value of the fees earned and the value of fees waived was less than $0.1 million for each of the three months ended March 31, 2020 and 2019 . Affiliated fund transactions The Company earns investment advisory fees, distribution fees and administrative service fees under agreements with affiliated mutual funds and collective investment trusts. Fees earned for advisory and distribution services provided were approximately $8.9 million for the three months ended March 31, 2020 , and approximately $11.1 million for the three months ended March 31, 2019 . Fees earned for administrative services provided were approximately $0.4 million for the three months ended March 31, 2020 , and approximately $0.5 million for the three months ended March 31, 2019 . See Note 3 for disclosure of amounts due from affiliated mutual funds and collective investment trusts. The Company incurs certain expenses on behalf of the collective investment trusts and has contractually agreed to limit its fees and reimburse expenses to limit operating expenses incurred by certain affiliated fund series. The aggregate value of fees waived and expenses reimbursed to, or incurred for, affiliated mutual funds and collective investment trusts were approximately $1.2 million for the three months ended March 31, 2020 , and approximately $1.2 million for the three months ended March 31, 2019 . As of March 31, 2020 the Company had recorded a receivable of approximately $0.2 million for expenses paid on behalf of an affiliated mutual fund. These expenses are reimbursable to the Company under an agreement with the affiliated mutual fund, and are included within other long-term assets on the consolidated statements of financial condition. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Exchange of Class A units of Manning & Napier Group As of March 31, 2020 , a total of 62,034,200 units of Manning & Napier Group were held by the noncontrolling interests. Pursuant to the terms of the Exchange Agreement, such units may be tendered for exchange. On March 15, 2020, notice was provided that a total of 60,012,419 Class A units, including 59,957,419 units held by William Manning, who is also the Chairman of the Company's Board of Directors, would be tendered for cash or shares of the Company's Class common stock pursuant to the terms of the Exchange Agreement. Subsequent to March 31, 2020, the independent directors, on behalf of the Company, decided to settle the exchange utilizing approximately $90.8 million in cash, including approximately $90.7 million paid to Mr. Manning, pursuant to the terms of the Exchange Agreement. The Company completed the exchange on May 11, 2020 with payment made from the Company's cash, cash equivalents and proceeds from the sale of investment securities. Subsequent to the exchange, the Class A units were retired and as a result, the Company's ownership of Manning & Napier Group increased from 19.5% to 88.2% . |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited consolidated financial statements were prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and related rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) for interim financial reporting and include all adjustments, consisting only of normal recurring adjustments which are, in the opinion of management, necessary for a fair statement of the results for the interim period. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates or assumptions that affect the reported amounts and disclosures in the consolidated financial statements. Actual results could differ from these estimates or assumptions. Summary of Presentation Changes As of January 1, 2020, the Company revised its presentation of investment management revenue within its consolidated statements of operations. Investment management revenue, previously presented by investment vehicle, has been disaggregated to present investment management revenue by sales channel. Concurrently, the Company revised the presentation of assets under management ("AUM") activity previously reported by investment vehicle to present this activity by sales channel. Amounts for the comparative prior periods have been reclassified to conform to the current period presentation. These reclassifications had no impact on previously reported net income and do not represent a restatement of any previously published financial results. |
Principles of Consolidation | Principles of Consolidation The Company consolidates all majority-owned subsidiaries. In addition, as of March 31, 2020 , Manning & Napier holds an economic interest of approximately 19.5% in Manning & Napier Group but, as managing member, controls all of the business and affairs of Manning & Napier Group. As a result, the Company consolidates the financial results of Manning & Napier Group and records a noncontrolling interest on its consolidated statements of financial condition with respect to the remaining economic interest in Manning & Napier Group held by Manning & Napier Group Holdings, LLC (“M&N Group Holdings”) and Manning & Napier Capital Company, LLC (“MNCC”). All material intercompany transactions have been eliminated in consolidation. In accordance with Accounting Standards Update ("ASU") 2015-02, Consolidation (Topic 810) – Amendments to the Consolidation Analysis , the determination of whether a company is required to consolidate an entity is based on, among other things, an entity’s purpose and design, a company’s ability to direct the activities of the entity that most significantly impact the entity’s economic performance, and whether a company is obligated to absorb losses or receive benefits that could potentially be significant to the entity. The standard also requires ongoing assessments of whether a company is the primary beneficiary of a variable interest entity (“VIE”). When utilizing the voting interest entity ("VOE") model, controlling financial interest is generally defined as majority ownership of voting interests. The Company provides seed capital to its investment teams to develop new strategies and services for its clients. The original seed investment may be held in a separately managed account, comprised solely of the Company's investments or within a mutual fund, where the Company's investments may represent all or only a portion of the total equity investment in the mutual fund. Pursuant to U.S. GAAP, the Company evaluates its investments in mutual funds on a regular basis and consolidates such mutual funds for which it holds a controlling financial interest. When no longer deemed to hold a controlling financial interest, the Company would deconsolidate the fund and classify the remaining investment as either an equity method investment, equity investments, at fair value, or as trading securities, as applicable. As of March 31, 2020 and December 31, 2019 , the Company did not have investments classified as an equity method investment. The Company serves as the investment adviser for Manning & Napier Fund, Inc. series of mutual funds (the “Fund”), Exeter Trust Company Collective Investment Trusts (“CIT”) and Rainier Multiple Investment Trust. The Fund, CIT and Rainier Multiple Investment Trust are legal entities, the business and affairs of which are managed by their respective boards of directors. As a result, each of these entities is a VOE. The Company holds, in limited cases, direct investments in a mutual fund (which are made on the same terms as are available to other investors) and consolidates each of these entities where it has a controlling financial interest or a majority voting interest. The Company's investments in the Fund amounted to approximately $2.6 million as of March 31, 2020 and $3.2 million as of December 31, 2019 . As of March 31, 2020 and December 31, 2019 , the Company did not have a controlling financial interest in any mutual fund. |
Revenue | Revenue Investment Management: Investment management fees are computed as a percentage of AUM. The Company's performance obligation is a series of services that form part of a single performance obligation satisfied over time. Separately managed accounts are paid in advance, typically for a semi-annual or quarterly period, or in arrears, typically for a monthly or quarterly period. When investment management fees are paid in advance, the Company defers the revenue as a contract liability and recognizes it over the applicable period. When investment management fees are paid in arrears, the Company estimates revenue and records a contract asset (accrued accounts receivable) based on AUM as of the most recent month end date. Mutual funds and collective investment trust investment management revenue is calculated and earned daily based on AUM. Revenue is presented net of cash rebates and fees waived pursuant to contractual expense limitations of the funds. The Company also has agreements with third parties who provide recordkeeping and administrative services for employee benefit plans participating in the collective investment trusts. The Company is acting as an agent on behalf of the employee benefit plan sponsors, therefore, investment management revenue is recorded net of fees paid to third party service providers. Distribution and shareholder servicing: The Company receives distribution and servicing fees for providing services to its affiliated mutual funds. Revenue is computed and earned daily based on a percentage of AUM. The performance obligation is a series of services that form part of a single performance obligation satisfied over time. The Company has agreements with third parties who provide distribution and administrative services for its mutual funds. The agreements are evaluated to determine whether revenue should be reported gross or net of payments to third-party service providers. The Company controls the services provided and acts as a principal in the relationship. Therefore, distribution and shareholder servicing revenue is recorded gross of fees paid to third parties. Custodial services: Custodial service fees are calculated as a percentage of the client’s market value with additional fees charged for certain transactions. For the safeguarding and administrative services that are subject to a percentage of market value fee, the Company's performance obligation is a series of services that form part of a single performance obligation satisfied over time. Revenue for transactions assigned a stand-alone selling price is recognized in the period in which the transaction is executed. Custodial service fees are billed monthly in arrears. The Company has agreements with third parties who provide safeguarding, recordkeeping and administrative services for their clients. The Company controls the services provided and acts as a principal in the relationship. Therefore, custodial service revenue is recorded gross of fees paid to third parties. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company generally considers all highly liquid investments with original maturities of three months or less to be cash equivalents. Cash and cash equivalents are primarily held in operating accounts at major financial institutions and also in money market securities. Cash equivalents are stated at cost, which approximates market value due to the short-term maturity of these investments. The fair value of cash equivalents has been classified as Level 1 in accordance with the fair value hierarchy. |
Investment Securities | Investment Securities Investment securities are classified as either trading, equity method investments or available-for-sale and are carried at fair value. Fair value is determined based on quoted market prices in active markets for identical or similar instruments. Investment securities classified as equity investments, at fair value consist of equity securities and investments in mutual funds for which the Company provides advisory services. Realized and unrealized gains and losses on equity investments, at fair value or trading securities, as applicable, are recorded in net gains (losses) on investments in the consolidated statements of operations. At March 31, 2020 , equity investments, at fair value consist of investments held by the Company to provide initial cash seeding for product development purposes and investments to hedge economic exposure to market movements on its deferred compensation plan. Investment securities classified as available-for-sale consist of U.S. Treasury notes, corporate bonds and other short-term investments. Unrealized gains and losses on available-for-sale securities are excluded from earnings and are reported, net of deferred income tax, as a separate component of accumulated other comprehensive income in shareholders’ equity until realized. The Company periodically reviews each individual security position that has an unrealized loss, or impairment, to determine if that impairment is other-than-temporary. If impairment is determined to be other-than-temporary, the carrying value of the security will be written down to fair value and the loss will be recognized in earnings. Realized gains and losses on sales of available-for-sale securities are computed on a specific identification basis and are recorded in net gains (losses) on investments in the consolidated statements of operations. |
Property and Equipment | Property and Equipment Property and equipment is presented net of accumulated depreciation of approximately $11.8 million and $11.4 million as of March 31, 2020 and December 31, 2019 , respectively. |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill represents the excess cost over the fair value of the identifiable net assets of acquired companies. Identifiable intangible assets generally represent the cost of client relationships and investment management agreements acquired as well as trademarks. Goodwill and indefinite-lived assets are tested for impairment annually or more frequently if events or circumstances indicate that the carrying value may not be recoverable. Intangible assets subject to amortization are tested for impairment whenever events or circumstances indicate that the carrying value may not be recoverable. Goodwill and intangible assets require significant management estimate and judgment, including the valuation and expected life determination in connection with the initial purchase price allocation and the ongoing evaluation for impairment. |
Leases | Leases The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use ("ROU") assets, accrued expenses and other liabilities and operating lease liabilities, non-current on its consolidated statements of financial condition. Finance leases are included in other long-term assets, accrued expenses and other liabilities, and other long-term liabilities on its consolidated statements of financial condition. ROU assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent the Company's obligation to make lease payments arising from the lease. Operating lease ROU assets and lease liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As the Company's leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The incremental borrowing rate, for each identified lease, is the rate of interest that the Company would have to pay to borrow on a collateralized basis over a similar term. The operating lease ROU asset is reduced for any lease incentives. The Company's lease terms may include options to extend or terminate the lease when it is reasonably certain that it will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease and non-lease components, which are combined for all classes of underlying assets. |
Operating Segments | Operating Segments The Company operates in one segment, the investment management industry. |
Recently Adopted Accounting Pronouncements | Recent Accounting Pronouncements In August 2018, the Financial Accounting Standards Board ("FASB") issued ASU 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract . The amendment aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements that currently exist in U.S. GAAP for capitalizing implementation costs incurred to develop or obtain internal-use software. Under the new standard, implementation costs are deferred and presented in the same financial statement caption on the consolidated statements of financial condition as a prepayment of related arrangement fees. The deferred costs are recognized over the term of the arrangement in the same financial statement caption in the consolidated statements of operations as the related fees of the arrangement. The Company adopted the provisions of this guidance using the prospective adoption approach, which does not require the restatement of prior years. The adoption of this ASU did not have a material impact on the Company's statement of operations as requirements under the standard are generally consistent with its previous accounting for cloud computing arrangements, with the primary difference being the classification of certain information in its statements of financial condition and related disclosures. As of March 31, 2020 , the Company had a total of approximately $2.3 million of capitalized implementation costs for hosting arrangements within prepaid expenses and other assets on its statements of financial condition, with no amounts in accumulated amortization and no amortization expense recognized during the three months ended March 31, 2020. At December 31, 2019, approximately $0.4 million of these costs were capitalized within property and equipment, net. The hosting arrangements that are service contracts include internal and external costs related to various technology additions in support of the Company's business. Amortization costs are recorded on a straight-line basis over the term of the hosting arrangement agreement. In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment , which simplifies the accounting for goodwill impairments by eliminating step two from the goodwill impairment test. The ASU requires goodwill impairments to be measured on the basis of the fair value of the reporting unit relative to the reporting unit's carrying amount rather than on the basis of the implied amount of goodwill relative to the goodwill balance of the reporting unit. The adoption of this ASU had did not have a material impact on the Company's consolidated financial statements. |
Revenue (Tables)
Revenue (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table represents the Company’s wealth management and institutional and intermediary investment management revenue by investment portfolio during the three months ended March 31, 2020 and 2019 : Three months ended March 31, 2020 Three months ended March 31, 2019 Wealth Management Institutional and Intermediary Total Wealth Management Institutional and Intermediary Total (in thousands) Blended Asset $ 11,942 $ 8,186 $ 20,128 $ 13,498 $ 7,828 $ 21,326 Equity 2,165 3,619 5,784 2,761 4,957 7,718 Fixed Income 193 326 519 210 449 659 Total $ 14,300 $ 12,131 $ 26,431 $ 16,469 $ 13,234 $ 29,703 |
Schedule of Accounts Receivable | Accounts receivable as of March 31, 2020 and December 31, 2019 consisted of the following: March 31, 2020 December 31, 2019 (in thousands) Accounts receivable - third parties $ 5,787 $ 5,778 Accounts receivable - affiliated mutual funds and collective investment trusts 3,719 4,404 Total accounts receivable $ 9,506 $ 10,182 The following provides amounts due from affiliated mutual funds and collective investment trusts reported within accounts receivable in the consolidated statements of financial condition as of March 31, 2020 and December 31, 2019 : March 31, 2020 December 31, 2019 (in thousands) Affiliated mutual funds $ 2,682 $ 3,164 Affiliated collective investment trusts 1,037 1,240 Accounts receivable - affiliated mutual funds and collective investment trusts $ 3,719 $ 4,404 |
Noncontrolling Interests (Table
Noncontrolling Interests (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Noncontrolling Interest [Abstract] | |
Reconciliation from Income Before Provision for Income Taxes to Net Income Attributable to Manning & Napier, Inc. | The following table provides a reconciliation from “Income (loss) before provision for (benefit from) income taxes” to “Net income attributable to Manning & Napier, Inc.”: Three months ended March 31, 2020 2019 (in thousands) Income (loss) before provision for (benefit from) income taxes $ (2,391 ) $ 3,159 Less: income (loss) before provision for (benefit from) income taxes of Manning & Napier, Inc. (1) (2,866 ) 191 Income before provision for (benefit from) income taxes, as adjusted 475 2,968 Controlling interest percentage (2) 19.5 % 18.6 % Net income attributable to controlling interest 93 552 Plus: income (loss) before provision for (benefit from) income taxes of Manning & Napier, Inc. (1) (2,866 ) 191 Income (loss) before provision for (benefit from) income taxes attributable to Manning & Napier, Inc. (2,773 ) 743 Less: provision for (benefit from) income taxes of Manning & Napier, Inc. (3) (3,631 ) 182 Net income attributable to Manning & Napier, Inc. $ 858 $ 561 ________________________ (1) Manning & Napier, Inc. incurs certain income or expenses that are only attributable to it and are therefore excluded from the net income attributable to noncontrolling interests. (2) Income before provision for (benefit from) income taxes is allocated to the controlling interest based on the percentage of units of Manning & Napier Group held by Manning & Napier, Inc. The amount represents the Company's weighted ownership of Manning & Napier Group for the respective periods. (3) The consolidated provision for income taxes is equal to the sum of (i) the provision for income taxes for entities other than Manning & Napier, Inc. and (ii) the provision for income taxes of Manning & Napier, Inc. which includes all U.S. federal and state income taxes. The consolidated provision for (benefit from) income taxes was a benefit of $3.2 million and provision of $0.2 million for the three months ended March 31, 2020 and March 31, 2019 , respectively. |
Impact to the Company's ownership interest in Manning & Napier Group | The following is the impact to the Company's equity ownership interest in Manning & Napier Group for the three months ended March 31, 2020 : Manning & Napier Group Class A Units Held Manning & Napier Total Manning & Napier Ownership % As of December 31, 2019 14,750,221 62,034,200 76,784,421 19.2% Class A Units issued 318,833 — 318,833 0.3% Class A Units exchanged — — — —% As of March 31, 2020 15,069,054 62,034,200 77,103,254 19.5% |
Investment Securities (Tables)
Investment Securities (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Investments [Abstract] | |
Company's Investment Securities Holdings | The following represents the Company’s investment securities holdings as of March 31, 2020 and December 31, 2019 : March 31, 2020 Cost Unrealized Gains Unrealized Losses Fair Value (in thousands) Available-for-sale securities U.S. Treasury notes $ 33,270 $ 409 $ — $ 33,679 Fixed income securities 23,089 — (734 ) 22,355 Short-term investments 7,405 — — 7,405 63,439 Equity investments, at fair value Equity securities 5,044 Mutual funds 2,560 7,604 Total investment securities $ 71,043 December 31, 2019 Cost Unrealized Gains Unrealized Losses Fair Value (in thousands) Available-for-sale securities U.S. Treasury notes $ 33,908 $ 193 $ — $ 34,101 Fixed income securities 35,148 — (91 ) 35,057 Short-term investments 12,119 — — 12,119 81,277 Equity investments, at fair value Equity securities 6,038 Mutual funds 3,152 9,190 Total investment securities $ 90,467 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Hierarchy of Inputs Used to Derive the Fair Value of Company's Financial Instruments | The following table summarizes the hierarchy of inputs used to derive the fair value of the Company’s assets as of March 31, 2020 and December 31, 2019 : March 31, 2020 Level 1 Level 2 Level 3 Totals (in thousands) Equity securities $ 5,044 $ — $ — $ 5,044 Fixed income securities — 22,355 — 22,355 Mutual funds 2,560 — — 2,560 U.S. Treasury notes — 33,679 — 33,679 Short-term investments — 7,405 — 7,405 Total assets at fair value $ 7,604 $ 63,439 $ — $ 71,043 December 31, 2019 Level 1 Level 2 Level 3 Totals (in thousands) Equity securities $ 6,038 $ — $ — $ 6,038 Fixed income securities — 35,057 — 35,057 Mutual funds 3,152 — — 3,152 U.S. Treasury notes — 34,101 — 34,101 Short-term investments — 12,119 — 12,119 Total assets at fair value $ 9,190 $ 81,277 $ — $ 90,467 |
Accrued Expenses and Other Li_2
Accrued Expenses and Other Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Accounts Payable and Accrued Liabilities [Abstract] | |
Accrued expenses, liabilities and severance costs | Accrued expenses and other liabilities as of March 31, 2020 and December 31, 2019 consisted of the following: March 31, 2020 December 31, 2019 (in thousands) Accrued bonus and sales commissions $ 6,176 $ 14,825 Accrued payroll and benefits 2,914 4,415 Accrued sub-transfer agent fees 384 420 Dividends payable on Class A common stock 326 312 Amounts payable under tax receivable agreement 3,960 275 Short-term operating lease liabilities 2,772 2,682 Other accruals and liabilities 3,690 3,272 Total accrued expenses and other liabilities $ 20,222 $ 26,201 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Components of Lease Expense, and Supplemental Cash Flow Information Related to Leases | The components of lease expense for the three months ended March 31, 2020 and 2019 were as follows: Three months ended March 31, 2020 2019 (in thousands) Finance lease expense Amortization of right-of-use assets $ 25 29 Interest on lease liabilities 2 3 Operating lease expense 792 923 Short-term lease expense 1 4 Variable lease expense 75 46 Sublease income (166 ) (123 ) Total lease expense $ 729 882 Supplemental cash flow information related to leases for the three months ended March 31, 2020 and 2019 were as follows: Three months ended March 31, 2020 2019 (in thousands) Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from finance leases $ 2 3 Finance cash flows from finance leases $ 27 27 Operating cash flows from operating leases $ 720 794 Right-of-use assets obtained in exchange for new lease obligations: Finance leases $ — 163 Operating leases $ 136 — |
Supplemental Balance Sheet Information Related to Leases | Supplemental balance sheet information related to leases as of March 31, 2020 was as follows: (in thousands, except lease term and discount rate) March 31, 2020 Finance Leases Finance lease right-of-use assets (1) $ 174 Accrued expenses and other liabilities $ 80 Other long-term liabilities 104 Total finance lease liabilities $ 184 Operating Leases Operating lease right-of-use assets $ 18,157 Accrued expenses and other liabilities $ 2,772 Operating lease liabilities, non-current 18,163 Total operating lease liabilities $ 20,935 Weighted average remaining lease term Finance leases 2.73 years Operating leases 7.18 years Weighted average discount rate Finance leases 4.81 % Operating leases 5.13 % _______________________ (1) Amounts included in other long-term assets within the consolidated statements of financial condition. |
Lessee, Operating Lease, Liability, Maturity | Maturities of lease liabilities were as follows: Twelve month period ending March 31, Finance Leases Operating Leases (in thousands) 2021 $ 87 $ 3,717 2022 57 3,726 2023 33 3,504 2024 20 3,136 2025 — 3,030 Thereafter — 7,929 Total lease payments 197 25,042 Less imputed interest (13 ) (4,107 ) Total lease liabilities $ 184 $ 20,935 |
Finance Lease, Liability, Maturity | Maturities of lease liabilities were as follows: Twelve month period ending March 31, Finance Leases Operating Leases (in thousands) 2021 $ 87 $ 3,717 2022 57 3,726 2023 33 3,504 2024 20 3,136 2025 — 3,030 Thereafter — 7,929 Total lease payments 197 25,042 Less imputed interest (13 ) (4,107 ) Total lease liabilities $ 184 $ 20,935 |
Earnings per Common Share (Tabl
Earnings per Common Share (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Calculation of basic and diluted earnings per share | The following is a reconciliation of the income and share data used in the basic and diluted EPS computations for the three months ended March 31, 2020 and 2019 under the two-class method: Three months ended March 31, 2020 2019 (in thousands, except share data) Net income attributable to controlling and noncontrolling interests $ 835 $ 2,917 Less: net income (loss) attributable to noncontrolling interests (23 ) 2,356 Net income attributable to Manning & Napier, Inc. $ 858 $ 561 Less: allocation to participating securities 13 (5 ) Net income available to Class A common stock $ 845 $ 566 Weighted average shares of Class A common stock outstanding - basic 15,812,951 14,927,265 Dilutive effect of unvested equity awards 60,406 304,183 Dilutive effect of exchangeable Class A Units 62,034,200 63,349,721 Weighted average shares of Class A common stock outstanding - diluted 77,907,557 78,581,169 Net income available to Class A common stock per share - basic $ 0.05 $ 0.04 Net income available to Class A common stock per share - diluted $ 0.01 $ 0.03 |
Equity Based Compensation (Tabl
Equity Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Compensation [Abstract] | |
Schedule of Share-based Compensation, Restricted Stock and Restricted Stock Units Activity | The following table summarizes activity related to awards of restricted stock and restricted stock units (collectively, "stock awards") under the Equity Plan for the three months ended March 31, 2020 : Stock Awards Weighted Average Grant Date Fair Value Outstanding at January 1, 2020 1,037,901 $ 4.30 Granted 2,997,940 $ 1.58 Vested (321,665 ) $ 1.64 Forfeited (2,667 ) $ 1.67 Outstanding at March 31, 2020 3,711,509 $ 2.34 |
Share-based Compensation, Stock Options, Activity | A summary of activity under the Equity Plan related to stock option awards during the three months ended March 31, 2020 is presented below: Stock Option Awards Weighted Average Exercise Price Weighted Average Contractual Term (years) Aggregate Intrinsic Value (in thousands) Outstanding at January 1, 2020 3,500,000 $ 2.01 Granted — $ — Vested (166,666 ) $ 2.01 Forfeited — $ — Outstanding at March 31, 2020 3,333,334 $ 2.01 4.1 $ — Exercisable at March 31, 2020 166,666 $ 2.01 |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Tax Provision and Effective Tax Rate | The Company’s income tax provision (benefit) and effective tax rate were as follows: Three months ended March 31, 2020 2019 (in thousands) Income (loss) before provision for (benefit from) income taxes $ (2,391 ) $ 3,159 Effective tax rate 134.9 % 7.7 % Provision for (benefit from) income taxes (3,226 ) 242 Provision for (benefit from) income taxes at statutory rate (502 ) 663 Difference between tax at effective vs. statutory rate $ (2,724 ) $ (421 ) |
Organization and Nature of th_2
Organization and Nature of the Business (Details) | 3 Months Ended |
Mar. 31, 2020 | |
Other Ownership Interests [Line Items] | |
Outside ownership interest in limited liability and limited partnership companies | 1.00% |
Majority Outside Ownership Interest in limited liability and limited partnership companies | 79.50% |
Manning & Napier, Inc. | |
Other Ownership Interests [Line Items] | |
Limited Liability Company (LLC) or Limited Partnership (LP), Managing Member or General Partner, Ownership Interest | 19.50% |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) | 3 Months Ended | |
Mar. 31, 2020USD ($)Segment | Dec. 31, 2019USD ($) | |
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | ||
Accumulated depreciation | $ 11,800,000 | $ 11,400,000 |
Number of segments | Segment | 1 | |
Capitalized computer software, accumulated amortization | $ 0 | |
Capitalized computer software amortization | 0 | |
Managed Mutual Funds and Managed Mutual Consolidated Funds | Manning & Napier Fund | ||
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | ||
Mutual Funds, at fair value | $ 2,600,000 | 3,200,000 |
Manning & Napier, Inc. | ||
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | ||
Percentage of economic interest in Manning & Napier Group held by Manning & Napier, Inc (percent) | 19.50% | |
Prepaid Expenses and Other Current Assets | ||
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | ||
Capitalized computer software, gross | $ 2,300,000 | |
Property, Plant and Equipment | ||
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | ||
Capitalized computer software, gross | $ 400,000 |
Revenue (Disaggregation of Reve
Revenue (Disaggregation of Revenue) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Disaggregation of Revenue [Line Items] | ||
Revenues | $ 31,109 | $ 34,797 |
Wealth Management | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 14,300 | 16,469 |
Wealth Management | Blended Asset | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 11,942 | 13,498 |
Wealth Management | Equity | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 2,165 | 2,761 |
Wealth Management | Fixed Income | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 193 | 210 |
Institutional and Intermediary | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 12,131 | 13,234 |
Institutional and Intermediary | Blended Asset | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 8,186 | 7,828 |
Institutional and Intermediary | Equity | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 3,619 | 4,957 |
Institutional and Intermediary | Fixed Income | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 326 | 449 |
Management Fees | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 26,431 | 29,703 |
Management Fees | Blended Asset | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 20,128 | 21,326 |
Management Fees | Equity | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 5,784 | 7,718 |
Management Fees | Fixed Income | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | $ 519 | $ 659 |
Revenue (Schedule of Accounts R
Revenue (Schedule of Accounts Receivable) (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Disaggregation of Revenue [Line Items] | ||
Accounts receivable | $ 9,506 | $ 10,182 |
Accounts receivable - third parties | ||
Disaggregation of Revenue [Line Items] | ||
Accounts receivable | 5,787 | 5,778 |
Accounts receivable - affiliated mutual funds and collective investment trusts | ||
Disaggregation of Revenue [Line Items] | ||
Accounts receivable | 3,719 | 4,404 |
Affiliated mutual funds | ||
Disaggregation of Revenue [Line Items] | ||
Accounts receivable | 2,682 | 3,164 |
Affiliated collective investment trusts | ||
Disaggregation of Revenue [Line Items] | ||
Accounts receivable | $ 1,037 | $ 1,240 |
Revenue (Additional Information
Revenue (Additional Information) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Revenue [Line Items] | |||
Revenues | $ 31,109 | $ 34,797 | |
Contract with Customer, Asset, Cumulative Catch-up Adjustment to Revenue, Change in Estimate of Transaction Price | (100) | ||
Accrued Accounts Receivable | 200 | $ 300 | |
Contract with Customer, Liability, Revenue Recognized | 8,300 | ||
Capitalized Contract Cost, Net | 1,000 | $ 1,000 | |
Capitalized Contract Cost, Amortization | 100 | 100 | |
Advisory Related Services [Member] | |||
Revenue [Line Items] | |||
Revenues | 8,900 | 11,100 | |
Wealth Management | |||
Revenue [Line Items] | |||
Revenues | $ 14,300 | 16,469 | |
Minimum | Wealth Management | |||
Revenue [Line Items] | |||
Customer Contract Period | 3 years | ||
Maximum | |||
Revenue [Line Items] | |||
Capitalized Contract Cost, Impairment Loss | $ 100 | $ 100 | |
Maximum | Wealth Management | |||
Revenue [Line Items] | |||
Customer Contract Period | 7 years |
Noncontrolling Interests (Textu
Noncontrolling Interests (Textual) (Detail) - USD ($) | Mar. 15, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Noncontrolling Interest [Line Items] | |||
Estimated payments due to selling unit holders | $ 20,400,000 | $ 17,500,000 | |
Amounts payable under tax receivable agreement | 3,960,000 | 275,000 | |
Payment pursuant to tax receivable agreement | $ 0 | ||
Manning And Napier Group Holding LLC | |||
Noncontrolling Interest [Line Items] | |||
Percentage of economic interest in Manning & Napier Group held by MN Group Holdings, MNCC and the other members of Manning & Napier Group (percent) | 80.50% | ||
Class A Units | Manning & Napier Group, LLC | |||
Noncontrolling Interest [Line Items] | |||
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests, Shares | 0 | ||
Class A Units | Manning And Napier Group Holding LLC | |||
Noncontrolling Interest [Line Items] | |||
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests, Shares | 60,012,419 | ||
Accrued expenses and other liabilities | |||
Noncontrolling Interest [Line Items] | |||
Estimated payments due to selling unit holders | $ 4,000,000 | ||
Manning & Napier, Inc. | |||
Noncontrolling Interest [Line Items] | |||
Percentage of economic interest in Manning & Napier Group held by Manning & Napier, Inc (percent) | 19.50% | ||
Manning & Napier, Inc. | Class A Units | |||
Noncontrolling Interest [Line Items] | |||
Percentage of economic interest in Manning & Napier Group held by Manning & Napier, Inc (percent) | 19.50% | 19.20% |
Noncontrolling Interests (Recon
Noncontrolling Interests (Reconciliation of Income) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Noncontrolling Interest [Abstract] | ||
Income (loss) before provision for (benefit from) income taxes | $ (2,391) | $ 3,159 |
Less: gain (loss) before provision for income taxes of Manning & Napier, Inc. | (2,866) | 191 |
Income before provision for (benefit from) income taxes, as adjusted | $ 475 | $ 2,968 |
Controlling interest percentage | 19.50% | 18.60% |
Net income attributable to controlling interest | $ 93 | $ 552 |
Plus: gain (loss) before provision for income taxes of Manning & Napier, Inc. | (2,866) | 191 |
Income (loss) before provision for (benefit from) income taxes attributable to Manning & Napier, Inc. | (2,773) | 743 |
Less: provision for income taxes of Manning & Napier, Inc. | (3,631) | 182 |
Net income attributable to Manning & Napier, Inc. | 858 | 561 |
Provision for (benefit from) income taxes | $ (3,226) | $ 242 |
Noncontrolling Interests (Summa
Noncontrolling Interests (Summary of Equity Ownership Interest) (Details) - Class A Units | 3 Months Ended |
Mar. 31, 2020shares | |
Manning & Napier Group, LLC | |
Noncontrolling Interest [Line Items] | |
Noncontrolling Interest, Shares Held by Parent, beginning balance | 14,750,221 |
Noncontrolling Interest, Shares Held by Parent, Issued | 318,833 |
Noncontrolling Interest, Shares Held by Parent, Exchanged | 0 |
Noncontrolling Interest, Shares Held by Parent, ending balance | 15,069,054 |
Noncontrolling Interest, Shared Held by Noncontrolling Owners, beginning balance | 62,034,200 |
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests, Shares | 0 |
Noncontrolling Interest, Shared Held by Noncontrolling Owners, ending balance | 62,034,200 |
Noncontrolling Interest, Shares, Beginning Balance | 76,784,421 |
Noncontrolling Interest, Shares Total, Issued | 318,833 |
Noncontrolling Interest, Shares Total, Exchanged | 0 |
Noncontrolling Interest, Shares, Ending Balance | 77,103,254 |
Manning & Napier, Inc. | |
Noncontrolling Interest [Line Items] | |
Noncontrolling interest ownership percentage by Parent, beginning balance | 19.20% |
Noncontrolling Interest, Ownership Percentage by Parent, Issued | 0.30% |
Noncontrolling Interest, Ownership Percentage by Parent, Exchanged | 0.00% |
Noncontrolling interest ownership percentage by Parent, ending balance | 19.50% |
Investment Securities (Company'
Investment Securities (Company's Investment Securities Holdings) (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Investment Holdings [Line Items] | ||
Fair Value | $ 63,439 | $ 81,277 |
Equity investments, at fair value | 7,604 | 9,190 |
Total investment securities | 71,043 | 90,467 |
U.S. Treasury notes | ||
Investment Holdings [Line Items] | ||
Cost | 33,270 | 33,908 |
Unrealized Gains | 409 | 193 |
Unrealized Losses | 0 | 0 |
Fair Value | 33,679 | 34,101 |
Fixed income securities | ||
Investment Holdings [Line Items] | ||
Cost | 23,089 | 35,148 |
Unrealized Gains | 0 | 0 |
Unrealized Losses | (734) | (91) |
Fair Value | 22,355 | 35,057 |
Short-term investments | ||
Investment Holdings [Line Items] | ||
Cost | 7,405 | 12,119 |
Unrealized Gains | 0 | 0 |
Unrealized Losses | 0 | 0 |
Fair Value | 7,405 | 12,119 |
Equity securities | ||
Investment Holdings [Line Items] | ||
Equity investments, at fair value | 5,044 | 6,038 |
Manning & Napier Fund | Mutual funds | ||
Investment Holdings [Line Items] | ||
Equity investments, at fair value | $ 2,560 | $ 3,152 |
Investment Securities (Textual)
Investment Securities (Textual) (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Investments [Abstract] | |||
Recognized net unrealized gains (loss) on equity securities at fair value | $ (1,800,000) | $ 900,000 | |
Available-for-sale Securities, Restricted | 600,000 | $ 600,000 | |
Other than temporary impairment losses | $ 0 | $ 0 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale securities, at fair value | $ 63,439 | $ 81,277 |
Total assets at fair value | 71,043 | 90,467 |
Equity securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Mutual Funds, at fair value | 5,044 | 6,038 |
Fixed income securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale securities, at fair value | 22,355 | 35,057 |
Mutual funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Mutual Funds, at fair value | 2,560 | 3,152 |
U.S. Treasury notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale securities, at fair value | 33,679 | 34,101 |
Short-term investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale securities, at fair value | 7,405 | 12,119 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets at fair value | 7,604 | 9,190 |
Level 1 | Equity securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Mutual Funds, at fair value | 5,044 | 6,038 |
Level 1 | Fixed income securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale securities, at fair value | 0 | 0 |
Level 1 | Mutual funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Mutual Funds, at fair value | 2,560 | 3,152 |
Level 1 | U.S. Treasury notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale securities, at fair value | 0 | 0 |
Level 1 | Short-term investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale securities, at fair value | 0 | 0 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets at fair value | 63,439 | 81,277 |
Level 2 | Equity securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Mutual Funds, at fair value | 0 | 0 |
Level 2 | Fixed income securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale securities, at fair value | 22,355 | 35,057 |
Level 2 | Mutual funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Mutual Funds, at fair value | 0 | 0 |
Level 2 | U.S. Treasury notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale securities, at fair value | 33,679 | 34,101 |
Level 2 | Short-term investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale securities, at fair value | 7,405 | 12,119 |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets at fair value | 0 | 0 |
Level 3 | Equity securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Mutual Funds, at fair value | 0 | 0 |
Level 3 | Fixed income securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale securities, at fair value | 0 | 0 |
Level 3 | Mutual funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Mutual Funds, at fair value | 0 | 0 |
Level 3 | U.S. Treasury notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale securities, at fair value | 0 | 0 |
Level 3 | Short-term investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale securities, at fair value | $ 0 | $ 0 |
Accrued Expenses and Other Li_3
Accrued Expenses and Other Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Accounts Payable and Accrued Liabilities [Abstract] | ||
Accrued bonus and sales commissions | $ 6,176 | $ 14,825 |
Accrued payroll and benefits | 2,914 | 4,415 |
Accrued sub-transfer agent fees | 384 | 420 |
Dividends payable | 326 | 312 |
Amounts payable under tax receivable agreement | 3,960 | 275 |
Short-term operating lease liabilities | 2,772 | 2,682 |
Other accruals and liabilities | 3,690 | 3,272 |
Total accrued expenses and other liabilities | $ 20,222 | $ 26,201 |
Leases (Additional Information)
Leases (Additional Information) (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Lessee, Lease, Description [Line Items] | |
Sublease income expected | $ 3.8 |
Minimum | |
Lessee, Lease, Description [Line Items] | |
Lessee remaining lease term | 1 year |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Lessee remaining lease term | 8 years |
Leases (Components of Lease Exp
Leases (Components of Lease Expense) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Finance lease expense | ||
Amortization of right-of-use assets | $ 25 | $ 29 |
Interest on lease liabilities | 2 | 3 |
Operating lease expense | 792 | 923 |
Short-term lease expense | 1 | 4 |
Variable lease expense | 75 | 46 |
Sublease income | (166) | (123) |
Total lease expense | $ 729 | $ 882 |
Leases (Supplemental Cash Flow
Leases (Supplemental Cash Flow Information related to Leases) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Leases [Abstract] | ||
Operating cash flows from finance leases | $ 2 | $ 3 |
Finance cash flows from finance leases | 27 | 27 |
Operating cash flows from operating leases | 720 | 794 |
Right-of-use assets obtained in exchange for finance lease obligations | 0 | 163 |
Right-of-use assets obtained in exchange for operating lease obligations | $ 136 | $ 0 |
Leases (Supplemental Balance Sh
Leases (Supplemental Balance Sheet Information Related to Leases) (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Leases [Abstract] | ||
Finance lease right-of-use assets | $ 174 | |
Accrued expenses and other liabilities | 80 | |
Other long-term liabilities | 104 | |
Total finance lease liabilities | 184 | |
Operating lease right-of-use assets | 18,157 | $ 18,795 |
Accrued expenses and other liabilities | 2,772 | 2,682 |
Operating lease liabilities, non-current | 18,163 | $ 18,753 |
Total operating lease liabilities | $ 20,935 | |
Finance Lease, Weighted Average Remaining Lease Term | 2 years 8 months 23 days | |
Operating Lease, Weighted Average Remaining Lease Term | 7 years 2 months 5 days | |
Finance Lease, Weighted Average Discount Rate, Percent | 4.81% | |
Operating Lease, Weighted Average Discount Rate, Percent | 5.13% |
Leases (Maturities of Lease Lia
Leases (Maturities of Lease Liabilities) (Details) $ in Thousands | Mar. 31, 2020USD ($) |
Finance Leases | |
2021 | $ 87 |
2022 | 57 |
2023 | 33 |
2024 | 20 |
2025 | 0 |
Thereafter | 0 |
Total lease payments | 197 |
Less imputed interest | (13) |
Total lease liabilities | 184 |
Operating Leases | |
2021 | 3,717 |
2022 | 3,726 |
2023 | 3,504 |
2024 | 3,136 |
2025 | 3,030 |
Thereafter | 7,929 |
Total lease payments | 25,042 |
Less imputed interest | (4,107) |
Total lease liabilities | $ 20,935 |
Earnings per Common Share (Deta
Earnings per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Net income attributable to controlling and noncontrolling interests | $ 835 | $ 2,917 |
Less: net income (loss) attributable to noncontrolling interests | (23) | 2,356 |
Net income attributable to Manning & Napier, Inc. | 858 | 561 |
Less: allocation to participating securities | 13 | (5) |
Net income available to Class A common stock | $ 845 | $ 566 |
Weighted average shares of Class A common stock outstanding - basic (in shares) | 15,812,951 | 14,927,265 |
Dilutive effect from unvested equity awards (in shares) | 60,406 | 304,183 |
Dilutive effect of exchangeable Class A Units (in shares) | 62,034,200 | 63,349,721 |
Weighted average shares of Class A common stock outstanding - diluted (in shares) | 77,907,557 | 78,581,169 |
Net income available to Class A common stock per share - basic (in dollars per share) | $ 0.05 | $ 0.04 |
Net income available to Class A common stock per share - diluted (in dollars per share) | $ 0.01 | $ 0.03 |
Antidilutive securities excluded from computation of earnings per share (in shares) | 1,276,391 | 1,413,560 |
Employee Stock Option | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 3,000,000 | 3,000,000 |
Class A Units | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 62,034,200 |
Equity Based Compensation (Text
Equity Based Compensation (Textual) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Granted, weighted average grant date fair value (dollars per share) | $ 1.58 | |
Aggregate intrinsic value vested | $ 500 | $ 1,000 |
Tax withholding (in shares) | 2,832 | |
Payment of shares withheld to satisfy withholding requirements | $ (2) | 0 |
Employee Stock Option | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based compensation expense | $ 100 | 100 |
Weighted average period of unrecognized compensation expense (years) | 11 months | |
Compensation not yet recognized | $ 800 | |
2011 Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares authorized | 13,142,813 | |
Share-based compensation expense | $ 1,100 | $ 1,400 |
Unrecognized compensation expense related to unvested awards | $ 6,300 | |
Weighted average period of unrecognized compensation expense (years) | 3 years 6 months | |
Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Payment of shares withheld to satisfy withholding requirements | $ (100) |
Equity Based Compensation (Rest
Equity Based Compensation (Restricted Stock Awards) (Details) | 3 Months Ended |
Mar. 31, 2020$ / sharesshares | |
Stock Units | |
Stock unit awards, beginning balance (shares) | shares | 1,037,901 |
Granted (shares) | shares | 2,997,940 |
Vested (shares) | shares | (321,665) |
Forfeited (shares) | shares | (2,667) |
Stock unit awards, ending balance (shares) | shares | 3,711,509 |
Weighted Average Grant Date Fair Value | |
Stock unit awards, beginning balance, weighted average grant date fair value (dollars per share) | $ / shares | $ 4.30 |
Granted, weighted average grant date fair value (dollars per share) | $ / shares | 1.58 |
Vested, weighted average grant date fair value (dollars per share) | $ / shares | 1.64 |
Forfeited, weighted average grant date fair value (dollars per share) | $ / shares | 1.67 |
Stock unit awards, ending balance, weighted average grant date fair value (dollars per share) | $ / shares | $ 2.34 |
Equity Based Compensation (Stoc
Equity Based Compensation (Stock Option Activity) (Details) $ / shares in Units, $ in Thousands | 3 Months Ended |
Mar. 31, 2020USD ($)$ / sharesshares | |
Stock Option Awards | |
Outstanding at January 1, 2020 (in shares) | shares | 3,500,000 |
Granted (in shares) | shares | 0 |
Vested (in shares) | shares | (166,666) |
Forfeited (in shares) | shares | 0 |
Outstanding at March 31, 2020 (in shares) | shares | 3,333,334 |
Weighted Average Exercise Price | |
Outstanding at January 1, 2020 (in USD per share) | $ / shares | $ 2.01 |
Granted (in USD per share) | $ / shares | 0 |
Vested (in USD per share) | $ / shares | 2.01 |
Forfeited (in USD per share) | $ / shares | 0 |
Outstanding at March, 31, 2020 (in USD per share) | $ / shares | $ 2.01 |
Weighted Average Contractual Term (years) | 4 years 1 month 6 days |
Aggregate Intrinsic Value (in thousands) | $ | $ 0 |
Exercisable at March 31, 2020 (in shares) | shares | 166,666 |
Exercisable at March 31, 2020 (in USD per share) | $ / shares | $ 2.01 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Operating Loss Carryforwards [Line Items] | |||
Effect of change in enacted tax rate | $ 3,300 | ||
Change in amounts payable under tax receivable agreement | 2,850 | $ (195) | $ (2,850) |
Increase in unrecognized tax benefits is reasonably possible | $ 1,200 | ||
Domestic Tax Authority | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | 12,100 | ||
State and Local Jurisdiction | |||
Operating Loss Carryforwards [Line Items] | |||
Operating loss carryforwards | $ 6,100 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||
Income (loss) before provision for (benefit from) income taxes | $ (2,391) | $ 3,159 |
Effective tax rate | 134.90% | 7.70% |
Provision for (benefit from) income taxes | $ (3,226) | $ 242 |
Provision for (benefit from) income taxes at statutory rate | (502) | 663 |
Difference between tax at effective vs. statutory rate | $ (2,724) | $ (421) |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Executive Officer | ||
Related Party Transaction [Line Items] | ||
Fees earned from related parties | $ 0.1 | $ 0.1 |
Advisory fees waived | 0.1 | 0.1 |
Accounts receivable - affiliated mutual funds and collective investment trusts | ||
Related Party Transaction [Line Items] | ||
Due from affiliate, current | 0.2 | |
Affiliated collective investment trusts | ||
Related Party Transaction [Line Items] | ||
Advisory fees waived | 1.2 | 1.2 |
Advisory And Distribution Services | Accounts receivable - affiliated mutual funds and collective investment trusts | Affiliated Entity | ||
Related Party Transaction [Line Items] | ||
Fees earned from related parties | 8.9 | 11.1 |
Administrative Service | Accounts receivable - affiliated mutual funds and collective investment trusts | Affiliated Entity | ||
Related Party Transaction [Line Items] | ||
Fees earned from related parties | $ 0.4 | $ 0.5 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ in Millions | May 11, 2020 | Mar. 15, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Manning & Napier Group, LLC | Class A Units | ||||
Subsequent Event [Line Items] | ||||
Noncontrolling Interest, Shared Held by Noncontrolling Owners | 62,034,200 | 62,034,200 | ||
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests, Shares | 0 | |||
Manning & Napier Group, LLC | Subsequent Event | ||||
Subsequent Event [Line Items] | ||||
Payments to acquire interest in subsidiaries and affiliates | $ 90.8 | |||
Manning And Napier Group Holding LLC | Class A Units | ||||
Subsequent Event [Line Items] | ||||
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests, Shares | 60,012,419 | |||
Majority Shareholder | Manning & Napier Group, LLC | Subsequent Event | ||||
Subsequent Event [Line Items] | ||||
Payments to acquire interest in subsidiaries and affiliates | $ 90.7 | |||
Majority Shareholder | Manning And Napier Group Holding LLC | Class A Units | ||||
Subsequent Event [Line Items] | ||||
Noncontrolling Interest, Decrease from Redemptions or Purchase of Interests, Shares | 59,957,419 | |||
Manning & Napier, Inc. | ||||
Subsequent Event [Line Items] | ||||
Limited Liability Company (LLC) or Limited Partnership (LP), Managing Member or General Partner, Ownership Interest | 19.50% | |||
Manning & Napier, Inc. | Subsequent Event | ||||
Subsequent Event [Line Items] | ||||
Limited Liability Company (LLC) or Limited Partnership (LP), Managing Member or General Partner, Ownership Interest | 88.20% |
Uncategorized Items - mn-202003
Label | Element | Value |
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 76,000 |
Noncontrolling Interest [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 0 |
Retained Earnings [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 76,000 |