Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2020 | Jul. 31, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jun. 30, 2020 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q2 | |
Current Fiscal Year End Date | --12-31 | |
Entity Registrant Name | ASSETMARK FINANCIAL HOLDINGS, INC. | |
Entity Central Index Key | 0001591587 | |
Entity File Number | 001-38980 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 30-0774039 | |
Entity Address, Address Line One | 1655 Grant Street | |
Entity Address, Address Line Two | 10th Floor | |
Entity Address, City or Town | Concord | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 94520 | |
City Area Code | 925 | |
Local Phone Number | 521-2200 | |
Title of 12(b) Security | Common stock, par value $0.001 per share | |
Trading Symbol | AMK | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Common Stock, Shares Outstanding | 72,445,003 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 93,584 | $ 96,341 |
Restricted cash | 8,500 | 9,000 |
Investments, at fair value | 8,224 | 7,275 |
Fees and other receivables, net | 8,939 | 9,679 |
Income tax receivable, net | 1,786 | 3,994 |
Other current assets | 11,690 | 6,565 |
Total current assets | 132,723 | 132,854 |
Property, plant and equipment, net | 6,902 | 7,067 |
Capitalized software, net | 68,578 | 69,814 |
Other intangible assets, net | 658,638 | 651,915 |
Operating lease right-of-use assets | 31,520 | |
Goodwill | 338,848 | 327,310 |
Total assets | 1,237,209 | 1,188,960 |
Current liabilities: | ||
Accounts payable | 297 | 967 |
Accrued liabilities and other current liabilities | 34,206 | 40,610 |
Total current liabilities | 34,503 | 41,577 |
Long-term debt, net | 121,850 | 121,692 |
Other long-term liabilities | 15,043 | 16,440 |
Long-term portion of operating lease liabilities | 35,579 | |
Deferred income tax liabilities, net | 150,795 | 150,390 |
Total long-term liabilities | 323,267 | 288,522 |
Total liabilities | 357,770 | 330,099 |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Common stock, $0.001 par value (675,000,000 shares authorized and 72,390,080 shares issued and outstanding as of June 30, 2020 and December 31, 2019) | 72 | 72 |
Additional paid-in capital | 823,528 | 796,406 |
Retained earnings | 55,839 | 62,383 |
Total stockholders’ equity | 879,439 | 858,861 |
Total liabilities and stockholders’ equity | $ 1,237,209 | $ 1,188,960 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Jun. 30, 2020 | Dec. 31, 2019 |
Statement Of Financial Position [Abstract] | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 675,000,000 | 675,000,000 |
Common stock, shares issued | 72,390,080 | 72,390,080 |
Common stock, shares outstanding | 72,390,080 | 72,390,080 |
Unaudited Condensed Consolidate
Unaudited Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Revenue: | ||||
Total revenue | $ 99,131 | $ 104,483 | $ 214,021 | $ 196,797 |
Expenses: | ||||
Asset-based expenses | 30,084 | 31,625 | 65,099 | 59,727 |
Spread-based expenses | 433 | 1,595 | 1,722 | 2,073 |
Employee compensation | 45,364 | 35,489 | 88,861 | 67,374 |
General and operating expenses | 13,383 | 13,135 | 32,748 | 25,427 |
Professional fees | 3,160 | 4,469 | 6,991 | 6,855 |
Depreciation and amortization | 8,747 | 7,613 | 17,156 | 14,509 |
Total expenses | 101,171 | 93,926 | 212,577 | 175,965 |
Interest expense | 1,474 | 4,031 | 3,101 | 8,055 |
Other (income) expense | (39) | 11 | ||
Income (loss) before income taxes | (3,475) | 6,526 | (1,668) | 12,777 |
Provision for income taxes | 5,805 | 3,289 | 4,876 | 6,729 |
Net income (loss) | (9,280) | 3,237 | (6,544) | 6,048 |
Net comprehensive income (loss) | $ (9,280) | $ 3,237 | $ (6,544) | $ 6,048 |
Net income (loss) per share attributable to common stockholders: | ||||
Net income (loss) per share, basic and diluted | $ (0.14) | $ 0.05 | $ (0.10) | $ 0.09 |
Weighted average number of common shares outstanding, basic | 67,208,746 | 66,150,000 | 67,175,603 | 66,150,000 |
Weighted average number of common shares outstanding, diluted | 67,208,746 | 66,150,000 | 67,175,603 | 66,150,000 |
Asset Based Revenue | ||||
Revenue: | ||||
Total revenue | $ 94,712 | $ 94,273 | $ 200,362 | $ 177,336 |
Spread Based Revenue | ||||
Revenue: | ||||
Total revenue | 3,549 | 8,810 | 11,500 | 16,359 |
Other Revenue | ||||
Revenue: | ||||
Total revenue | $ 870 | $ 1,400 | $ 2,159 | $ 3,102 |
Unaudited Condensed Consolida_2
Unaudited Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income |
Beginning balance at Dec. 31, 2018 | $ 699,011 | $ 66 | $ 635,096 | $ 63,846 | $ 3 |
Beginning balance, shares at Dec. 31, 2018 | 66,150,000 | ||||
Net income (loss) | 6,048 | 6,048 | |||
Other comprehensive income | 3 | (3) | |||
2018 dividend reclassification | 1,046 | (1,046) | |||
Share-based employee compensation | 10,452 | 10,452 | |||
Ending balance at Jun. 30, 2019 | 715,511 | $ 66 | 646,594 | 68,851 | |
Ending balance, shares at Jun. 30, 2019 | 66,150,000 | ||||
Beginning balance at Mar. 31, 2019 | 707,064 | $ 66 | 640,322 | 66,657 | 19 |
Beginning balance, shares at Mar. 31, 2019 | 66,150,000 | ||||
Net income (loss) | 3,237 | 3,237 | |||
Other comprehensive income | (16) | 3 | $ (19) | ||
2018 dividend reclassification | 1,046 | (1,046) | |||
Share-based employee compensation | 5,226 | 5,226 | |||
Ending balance at Jun. 30, 2019 | 715,511 | $ 66 | 646,594 | 68,851 | |
Ending balance, shares at Jun. 30, 2019 | 66,150,000 | ||||
Beginning balance at Dec. 31, 2019 | 858,861 | $ 72 | 796,406 | 62,383 | |
Beginning balance, shares at Dec. 31, 2019 | 72,390,080 | ||||
Net income (loss) | (6,544) | (6,544) | |||
Share-based employee compensation | 27,122 | 27,122 | |||
Ending balance at Jun. 30, 2020 | 879,439 | $ 72 | 823,528 | 55,839 | |
Ending balance, shares at Jun. 30, 2020 | 72,390,080 | ||||
Beginning balance at Mar. 31, 2020 | 874,785 | $ 72 | 809,594 | 65,119 | |
Beginning balance, shares at Mar. 31, 2020 | 72,390,080 | ||||
Net income (loss) | (9,280) | (9,280) | |||
Share-based employee compensation | 13,934 | 13,934 | |||
Ending balance at Jun. 30, 2020 | $ 879,439 | $ 72 | $ 823,528 | $ 55,839 | |
Ending balance, shares at Jun. 30, 2020 | 72,390,080 |
Unaudited Condensed Consolida_3
Unaudited Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net income (loss) | $ (6,544) | $ 6,048 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||
Depreciation and amortization | 17,156 | 14,509 |
Interest | 158 | 347 |
Deferred income taxes | 593 | 20 |
Share-based compensation | 27,122 | 10,452 |
Changes in certain assets and liabilities: | ||
Fees and other receivables, net | 1,333 | (1,461) |
Receivables from related party | (314) | |
Other current assets | 2,550 | (2,012) |
Accounts payable, accrued expenses and other liabilities | (15,072) | (17,675) |
Income tax receivable and payable | 2,208 | (2,406) |
Net cash provided by operating activities | 29,504 | 7,508 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Purchase of Global Financial Private Capital, LLC | (35,906) | |
Purchase of WBI OBS Financial, LLC, net of cash received | (18,561) | |
Purchase of investments | (1,497) | (21) |
Sale of investments | 5 | |
Purchase of property and equipment | (704) | (838) |
Purchase of computer software | (12,004) | (9,823) |
Net cash used in investing activities | (32,761) | (46,588) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Payments on long-term debt | (1,250) | |
Net cash (used in) provided by financing activities | (1,250) | |
Net change in cash, cash equivalents, and restricted cash | (3,257) | (40,330) |
Cash, cash equivalents, and restricted cash at beginning of period | 105,341 | 112,354 |
Cash, cash equivalents, and restricted cash at end of period | 102,084 | 72,024 |
SUPPLEMENTAL CASH FLOW INFORMATION | ||
Income taxes paid | 2,674 | 8,966 |
Interest paid | 2,939 | $ 7,708 |
Non-cash operating activities: | ||
Non-cash changes to right-of-use assets | 38,495 | |
Non-cash changes to lease liabilities | $ 39,839 |
Organization and Nature of Busi
Organization and Nature of Business | 6 Months Ended |
Jun. 30, 2020 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Organization and Nature of Business | Note 1. Organization and Nature of Business These unaudited condensed consolidated financial statements include AssetMark Financial Holdings, Inc. and its subsidiaries, which include AssetMark Financial, Inc., which is the parent company of AssetMark, Inc., AssetMark Trust Company, AssetMark Brokerage, LLC, AssetMark Retirement Services, Inc., Global Financial Private Capital, Inc., Global Financial Advisory, LLC, WBI OBS, Inc., OBS Financial, Inc. and OBS Financial Services, Inc. (collectively, the “Company”). The Company’s legal entity structure as of June 30, 2020 was as follows: The Company offers a broad array of wealth management solutions to individual investors through financial advisers by providing an open-architecture product platform along with tailored client advice, asset allocation options, practice management, support services and technology to the financial adviser channel. AssetMark Trust Company (“ATC”) is a licensed trust company incorporated under the laws of the State of Arizona on August 24, 1994 and regulated by the Arizona Department of Financial Institutions. ATC provides custodial recordkeeping services primarily to investor clients of registered investment advisers (including AMI) located throughout the United States. AssetMark, Inc. (“AMI”) is a registered investment adviser that was incorporated under the laws of the State of California on May 13, 1999. AMI offers a broad array of wealth management solutions to individual investors through financial advisers by providing an open-architecture product platform along with tailored client advice, asset allocation options, practice management, support services and technology solutions to the financial adviser channel. AMI serves as investment adviser to the Company’s proprietary GuideMark Funds, GuidePath Funds and the Savos Dynamic Hedging Fund, each of which is a mutual fund offered to clients of financial advisers. AssetMark Retirement Services, Inc. (“ARS”), formerly known as Aris Corporation of America, was incorporated under the laws of the State of Pennsylvania on April 30, 1974. ARS serves as the record-keeper and third-party administrator for the Aris Retirement product, which are 401(k) or 403(b) investment offerings utilized by small businesses. AssetMark Brokerage, LLC (“AMB”) is a limited-purpose broker-dealer located in Concord, California and was incorporated under the laws of the State of Delaware on September 25, 2013. AMB’s primary function is to distribute the mutual funds of the Company and to sponsor the FINRA licensing of those AssetMark associates who provide distribution support through promotion of the AssetMark programs and strategies that employ the Company’s mutual funds. Global Financial Private Capital, Inc. (“GFPC”), formerly known as Global Financial Private Capital, LLC and renamed effective July 12, 2019, is a registered investment adviser that was incorporated under the laws of the State of Florida on June 7, 2004. GFPC provides a broad suite of integrated wealth management services for institutional and individual investors. Global Financial Advisory, LLC (“GFA”) is an insurance services company that was incorporated under the laws of the State of Delaware on June 30, 2016. GFA provides insurance services on an intermediary basis and is not a policy writer. WBI OBS, Inc. (“OBL”), formerly known as WBI OBS Financial, LLC and renamed effective June 11, 2020, is a corporation that was incorporated under the laws of the State of Ohio on October 6, 2011. OBL is a holding company whose only assets are the share of common stock of OBS Holdings, Inc. (“OBF”). OBF is a corporation that was incorporated under the laws of the State of Ohio on April 14, 2000. OBF is a holding company whose only assets are the shares of common stock of OBS Financial Services, Inc. (“OBS”). OBS is a registed investment advisor that was incorporated under the laws of the State of Delaware on November 2, 2005. OBS provides a broad suite of integrated wealth management services for institutional and individual investors. See Note 3 for additional details on the acquisition completed during the quarter ended March 31, 2020. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | N ote 2. Summary of Significant Accounting Policies The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial statements and pursuant to the rules and regulations of the Securities and Exchange Commission. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments, consisting of only normal recurring adjustments, considered necessary for fair presentation have been included. The results of operations for the three and six months ended June 30, 2020 are not necessarily indicative of the results to be expected for the year ended December 31, 2020 or any future period. The accompanying unaudited interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes thereto for the year ended December 31, 2019 included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019. Risks and Uncertainties The COVID-19 pandemic continues to rapidly evolve and has adversely impacted global commercial activities. Management expects COVID-19 related changes in market and investor behaviors to impact our asset- and spread-based revenue. However, given the uncertainty around the duration and extent of the COVID-19 pandemic, management cannot predict the impact on the Company’s results of operations, financial condition or liquidity in the third quarter for 2020 and subsequent periods. Estimates and assumptions about future events and their effects on the Company cannot be determined with certainty and therefore require the exercise of judgment. The Company is not aware of any specific events or circumstances that would require the Company to update its estimates, assumptions and judgments or revise the carrying value of its assets or liabilities. The Company will update the estimates and assumptions underlying the consolidated financial statements in future periods as events and circumstances develop. Recent Accounting Pronouncements – Adopted In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which requires lessees to recognize leases on-balance sheet and disclose key information about leasing arrangements. The new standard establishes a right-of-use (“ROU”) model that requires a lessee to recognize an ROU asset and lease liability on the balance sheet for all leases with a term longer than 12 months. Leases are classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the income statement. The Company adopted the new standard on January 1, 2020 using the modified retrospective transition method with certain available transitional practical expedients, and elected to apply the short-term lease exemption (described below) to all of its classes of underlying assets. The standard had a material impact on the Company’s condensed consolidated balance sheets, but did not have an impact on the Company’s condensed consolidated statements of comprehensive income. The most significant impact was due to the recognition of ROU assets and lease liabilities for operating leases. Adoption of the standard had no impact on previously reported results. The Company determines if an arrangement is a lease at inception. Operating leases are included in other current assets, operating lease ROU assets, accrued liabilities and other current liabilities, and long-term portion of operating lease liabilities on the Company’s condensed consolidated balance sheets. The Company does not have material finance leases. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligations to make payments arising from the lease. Operating lease ROU assets and liabilities are recognized at the commencement date based on the present value of lease payments over the remaining lease term. The Company uses an estimated incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. 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. The Company has elected to use the practical expedient to exclude the non-lease component from the lease for all asset classes. The majority of the Company’s lease agreements are facility leases. The Company’s leases have a weighted-average lease term of 7.6 years and used a weighted-average discount rate of 3.63% as of June 30, 2020. Future minimum lease payments under non-cancellable leases as of June 30, 2020 is as follows: Remainder of 2020 $ 2,225 2021 5,525 2022 5,872 2023 5,710 2024 6,084 2025 and thereafter 19,671 Total $ 45,087 In January 2017, the FASB issued ASU 2017-04, Intangibles, Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment, which removes step 2 from the goodwill impairment test. As a result, an entity should perform its annual goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount and should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value. The Company adopted the ASU on January 1, 2020 and it did not have a significant impact on the Company’s consolidated financial statements and related disclosures. In July 2018, the FASB issued ASU 2018-11, Lease (Topic 842) Targeted Improvements, which increases transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing transactions. The Company adopted the ASU on January 1, 2020 and it did not have a significant impact on the Company’s consolidated financial statements and related disclosures. In August 2018, the FASB issued ASU 2018-15, Intangibles, Goodwill and Other, Internal-Use Software (Subtopic 350-40), which provides guidance to evaluate the accounting for fees paid by a customer in a cloud computing arrangement. If a cloud computing arrangement includes a license to internal-use-software, then the software license is accounted for by the customer in accordance with Subtopic ASC 350-40. An intangible asset is recognized for the software license and a liability also recognized. The Company adopted the ASU on January 1, 2020 and it did not have a significant impact on the Company’s consolidated financial statements and related disclosures. In October 2018, the FASB issued ASU 2018-17, Consolidation, Targeted Improvements to Related Party Guidance for Variable Interest Entities, which clarifies the determination as to whether a decision-making fee is a variable interest by requiring reporting entities to consider indirect interests held through related parties under common control on a proportional basis rather than as an equivalent of a direct interest in its entirety. The Company adopted the ASU on January 1, 2020 and it did not have a significant impact on the Company’s consolidated financial statements and related disclosures. Recent Accounting Pronouncements – Not Yet Adopted In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740), Simplifying the Accounting for Income Taxes, which removes certain exceptions to the general principles in Topic 740 and improves consistent application of U.S. GAAP by clarifying and amending existing guidance. The new standard is effective for the Company on January 1, 2021, with early adoption permitted. The Company is currently evaluating the effect that ASU 2019-12 will have on its consolidated financial statements. |
Acquisition of WBI OBS Financia
Acquisition of WBI OBS Financial, LLC | 6 Months Ended |
Jun. 30, 2020 | |
Business Combinations [Abstract] | |
Acquisition of WBI OBS Financial, LLC | Note 3. Acquisition of WBI OBS Financial, LLC On September 30, 2019, the Company entered into a unit purchase agreement to acquire WBI OBS Financial, LLC, subject to closing conditions that included approval from the Committee on Foreign Investment in the United States (“CFIUS ” ). On February 29, 2020, the Company closed the acquisition and paid a final purchase price of $21,339, net of working capital adjustments. The Company recorded goodwill of $11,538, adviser and trust relationships of $9,500 and deferred tax assets of $188 in connection with the acquisition. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 6 Months Ended |
Jun. 30, 2020 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Note 4. Goodwill and Intangible Assets Goodwill The Company’s goodwill balance was $338,848 and $327,310 as of June 30, 2020 and December 31, 2019, respectively. The Company, which has one reporting unit, performed an annual test for goodwill impairment in December for the years ended December 31, 2019 and 2018 and determined that goodwill was not impaired. The Company performed a qualitative test for goodwill impairment related to the COVID-19 pandemic and determined that an additional quantitative test was not necessary. Goodwill was not impaired as of June 30, 2020. Intangible Assets Information regarding the Company’s intangible assets is as follows: June 30, 2020 Gross carrying amount Accumulated amortization Net carrying amount Estimated remaining useful life Indefinite-lived intangible assets: Broker-dealer relationships $ 570,480 $ — $ 570,480 Definite-lived intangible assets: Trade names 45,830 (8,402 ) 37,428 16 years Broker-dealer license 11,550 (2,117 ) 9,433 16 years ATC regulatory status 23,300 (4,272 ) 19,028 16 years GFPC adviser relationships 14,250 (1,230 ) 13,020 13 years OBS adviser and trust relationships 9,500 (251 ) 9,249 12 years Total $ 674,910 $ (16,272 ) $ 658,638 December 31, 2019 Gross carrying amount Accumulated amortization Net carrying amount Estimated remaining useful life Indefinite-lived intangible assets: Broker-dealer relationships $ 570,480 $ — $ 570,480 Definite-lived intangible assets: Trade names 45,830 (7,256 ) 38,574 17 years Broker-dealer license 11,550 (1,829 ) 9,721 17 years ATC regulatory status 23,300 (3,689 ) 19,611 17 years GFPC adviser relationships 14,250 (721 ) 13,529 13 years Total $ 665,410 $ (13,495 ) $ 651,915 The weighted average estimated remaining useful life was 14.6 The expected future amortization expense for intangible assets as of June 30, 2020 Remainder of 2020 $ 3,385 2021 5,803 2022 5,803 2023 5,803 2024 5,803 2025 and thereafter 62,044 Total $ 88,641 |
Accrued Liabilities and Other C
Accrued Liabilities and Other Current Liabilities | 6 Months Ended |
Jun. 30, 2020 | |
Payables And Accruals [Abstract] | |
Accrued Liabilities and Other Current Liabilities | Note 5. Accrued Liabilities and Other Current Liabilities The following table shows the breakdown of accrued expenses and other current liabilities: June 30, 2020 December 31, 2019 Accrued bonus $ 8,376 $ 17,209 Compensation and benefits payable 7,834 7,591 Asset-based payables 3,752 3,718 Other accrued expenses 14,244 12,092 Total $ 34,206 $ 40,610 |
Other Long-Term Liabilities
Other Long-Term Liabilities | 6 Months Ended |
Jun. 30, 2020 | |
Other Liabilities Disclosure [Abstract] | |
Other Long-Term Liabilities | Note 6. Other Long-Term Liabilities Other long-term liabilities consisted of the following: June 30, 2020 December 31, 2019 Contractor liability $ 2,487 $ 3,083 Deferred compensation plan liability 7,804 6,885 Purchase commitments related to acquisition of GFPC 4,752 5,322 Deferred rent — 1,150 Total $ 15,043 $ 16,440 |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 7. Fair Value Measurements The following tables set forth the fair value of the Company’s financial assets and liabilities measured at fair value in the consolidated balance sheets as of June 30, 2020 and December 31, 2019, based on the three-tier fair value hierarchy: June 30, 2020 Fair Value Level I Level II Level III Assets: Equity investment and alternative investment securities funds (1) $ 420 $ 420 $ — $ — Assets to fund deferred compensation liability (2) 7,804 7,804 — — Total assets $ 8,224 $ 8,224 $ — $ — Liabilities: Deferred compensation liability (3) $ 7,804 $ 7,804 $ — $ — Total liabilities $ 7,804 $ 7,804 $ — $ — December 31, 2019 Fair Value Level I Level II Level III Assets: Equity investment and alternative investment securities funds (1) $ 390 $ 390 $ — $ — Assets to fund deferred compensation liability (2) 6,885 6,885 — — Total assets $ 7,275 $ 7,275 $ — $ — Liabilities: Deferred compensation liability (3) $ 6,885 $ 6,885 $ — $ — Total liabilities $ 6,885 $ 6,885 $ — $ — (1) The fair value of the Company’s rabbi trust, which comprises equity investment and alternative investment securities funds, is based on the month-end quoted market prices for the net asset value of the various constituent funds and securities, which mature on a daily basis. (2) The deferred compensation asset fair value is based on the month-end quoted market prices for the net asset value of the various investment funds. The Company recognized unrealized gains of $818, $(552) and $1,089 related to this asset within the statements of income and comprehensive income for the three and six months ended June 30, 2020, and for the year ended December 31, 2019, respectively. (3) The deferred compensation liability is included in other non-current liabilities in the consolidated balance sheets and its fair market value is based on the month-end market prices for the net asset value of the various funds in the Company’s rabbi trust which the participants have selected. The Company recognized other expenses of $818, $(552) and $1,089 related to this liability within the statements of income and comprehensive income for the three and six months ended June 30, 2020, and for the year ended December 31, 2019, respectively. |
Asset-Based Expenses
Asset-Based Expenses | 6 Months Ended |
Jun. 30, 2020 | |
Operating Costs And Expenses [Abstract] | |
Asset-Based Expenses | Note 8. Asset-Based Expenses Asset-based expenses incurred by the Company relating to the generation of asset-based revenues are as follows: Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 Strategist and manager fees $ 23,744 $ 25,518 $ 52,186 $ 48,121 Premier broker-dealer fees 2,689 2,444 5,748 4,536 Custody fees 1,585 1,275 3,115 2,449 Fund advisory fees 1,220 1,724 2,301 3,442 Marketing allowance 845 612 1,748 1,127 Other 1 52 1 52 Total $ 30,084 $ 31,625 $ 65,099 $ 59,727 |
Debt
Debt | 6 Months Ended |
Jun. 30, 2020 | |
Debt Disclosure [Abstract] | |
Debt | Note 9. Debt On November 14, 2018, the Company executed a Credit Agreement with Credit Suisse AG for a $250,000 term loan (the “Term Loan”) and a revolving line of credit (the “Revolver”) that permits the Company to borrow up to $20,000. The Term Loan matures on November 14, 2025 and the Revolver matures on November 14, 2023. On July 26, 2019, the Company made a partial repayment of $125 million of the Company’s outstanding indebtedness under the Term Loan. The repayment was considered a substantial modification and the debt was considered partially extinguished. As of June 30, 2020, $123.7 million aggregate principal amount of the Term Loan remained outstanding and the Revolver was undrawn, and both the Term Loan and the Revolver bore interest at the London InterBank Offered Rate (“LIBOR”) plus a margin of 3.0%. Interest expense was $1,474 and $4,031 for the three months ended June 30, 2020 and 2019, respectively, and $3,101 and $8,055 for the six months ended June 30, 2020 and 2019, respectively. |
Share-Based Compensation
Share-Based Compensation | 6 Months Ended |
Jun. 30, 2020 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Share-Based Compensation | Note 10. Share-Based Compensation On July 3, 2019, the Company’s Board of Directors adopted, and the Company’s sole stockholder approved, the 2019 Equity Incentive Plan (the “2019 Equity Incentive Plan”), which became effective on July 17, 2019, the date of effectiveness of the Company’s IPO (as defined below) registration statement on Form S-1. As of June 30, 2020, 3,672,918 shares were available for issuance under the 2019 Equity Incentive Plan. Restricted Stock Awards Prior to the liquidation and dissolution of AssetMark Holdings and the IPO, all officers and certain sales employees of AssetMark Holdings held Class C Common Units of AssetMark Holdings, which were intended to be treated as profits interests. Immediately following the pricing of the IPO, AssetMark Holdings liquidated and dissolved and distributed shares of the Company’s common stock to its members, including an aggregate number of restricted stock awards (“RSAs”) equal to 6,309,049 shares of the Company’s common stock to the holders of the Class C Common Units of AssetMark Holdings. These RSAs are subject to the same vesting schedule as the Class C Common Units of AssetMark Holdings, with 50% of the RSAs scheduled to vest in three (3) equal installments on the third, fourth and fifth anniversaries of November 18, 2016, subject to the recipient’s continued employment through the vesting date, and 50% subject to the recipient’s continued employment through February 1, 2021 and the satisfaction of a performance-based vesting condition. The performance condition for these RSAs was deemed to have been satisfied in connection with the IPO. In the event that the vesting conditions are not satisfied for any portion of an award, the shares covered by such RSAs will transfer automatically to the Company. Share-based compensation expense related to the RSAs was $12,782 and $25,034 for the three and six months ended June 30, 2020, respectively. Stock Options In connection with the IPO, the Company issued options to certain officers to acquire an aggregate of 918,981 shares of the Company’s common stock outside of the 2019 Equity Incentive Plan, with an exercise price of $22 dollars per share. Each of these options is scheduled to vest and become exercisable in substantially equal installments on each of the first three anniversaries of July 18, 2019. Share-based compensation expense related to the stock options was $583 and $1,167 for the three and six months ended June 30, 2020, respectively. Restricted Stock Units Also in connection with the IPO, the Company issued restricted stock units (“RSUs”) to certain officers and sales employees covering an aggregate of 85,737 shares of the Company’s common stock under the 2019 Equity Incentive Plan. Each of these RSUs is scheduled to vest in substantially equal installments on each of the first three anniversaries of July 18, 2019. Share-based compensation expense related to the RSUs was $431 and $783 for the three and six months ended June 30, 2020, respectively. Stock Appreciation Rights On June 9, 2020, the Company issued stock appreciation rights (“SARs”) with a grant date fair value of $7,764 to certain officers with respect to 819,844 shares of the Company’s common stock under the 2019 Equity Incentive Plan. Each SAR has a strike price equal to the fair market value of the Company’s common stock on the date of grant and is scheduled to vest and become exercisable in substantially equal installments on each of the first four anniversaries of June 9, 2020. Upon exercise, each of these SARs will be settled in shares of the Company’s common stock with a value equal to the excess, if any, of the fair market value of the Company’s common stock measured on the exercise date over the strike price. Share-based compensation expense related to SARs was $138 for both the three and six months ended June 30, 2020 . |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2020 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 11 . Commitments and Contingencies Litigation The Company faces the risk of litigation and regulatory investigations and actions in the ordinary course of operating its business, including the risk of class action lawsuits. The Company’s pending legal and regulatory actions include proceedings specific to the Company and others generally applicable to business practices in the industries in which the Company operates. The Company is also subject to litigation arising out of its general business activities such as its contractual and employment relationships. In addition, the Company is subject to various regulatory inquiries, such as information requests, subpoenas, books and record examinations and market conduct and financial examinations from state, federal and other authorities. A substantial legal liability or a significant regulatory action against the Company could have an adverse effect on its business, financial condition and results of operations. Moreover, even if the Company ultimately prevails in the litigation, regulatory action or investigation, the Company could suffer significant reputational harm, which could have an adverse effect on its business, financial condition or results of operations. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 12. Income Taxes The Company’s effective income tax rate differs from the federal corporate tax rate of 21.0%, primarily as a result of state taxes and the income tax effects of the Company’s share-based compensation. The Company’s effective tax rate was (167.1)% and 50.4% for the three months ended June 30, 2020 and 2019, respectively, and On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act was signed into law. The provisions of the CARES Act affecting corporations include, but are not limited to, elimination of certain limitations for utilizing net operating losses, relaxation of limitations on interest deductions, the expensing of costs of acquired qualified improvement property, employee retention tax credits and deferral of payroll taxes. There was no significant impact of this new law on the Company’s financial condition and results of operations for the three months ended June 30, 2020. |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Jun. 30, 2020 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note As of June 30, 2020 and December 31, 2019, the Company had a receivable due from Huatai Securities Co., Ltd. (“HTSC”) of $149 and $0, respectively, which represents the cash paid by the Company with respect to certain professional services incurred on behalf of HTSC related to IFRS audit fees and goodwill impairment test fees required by HTSC’s consolidated audit. The receivable balance of $149 was collected in cash during July 2020. |
Net Income Per Share Attributab
Net Income Per Share Attributable to Common Stockholders | 6 Months Ended |
Jun. 30, 2020 | |
Earnings Per Share [Abstract] | |
Net Income Per Share Attributable to Common Stockholders | Note 14. Net Income Per Share Attributable to Common Stockholders Basic net income per share is computed by dividing net income attributable to common stockholders by the basic weighted average number of shares of common stock outstanding for the period. For the calculation of diluted net income per share, the basic weighted average number of shares of common stock outstanding is increased by the dilutive effect (if any) of stock options, restricted stock awards and restricted stock units. The following table provides a reconciliation of the numerators and denominators used in computing basic and diluted net income per share attributable to common stockholders: Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 Net income (loss) attributable to common stockholders $ (9,280 ) $ 3,237 $ (6,544 ) $ 6,048 Weighted average number of shares of common stock used in computing net income (loss) per share attributable to common stockholders, basic and diluted 67,208,746 66,150,000 67,175,603 66,150,000 Net income (loss) per share attributable to common stockholders, basic and diluted $ (0.14 ) $ 0.05 $ (0.10 ) $ 0.09 The following securities were not included in the computation of diluted shares outstanding because such securities did not have a dilutive effect. Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 RSAs 2,239,929 — 2,136,795 — SARs 146,544 — 148,518 — RSUs 80,526 — 78,203 — Total 2,466,999 — 2,363,516 — |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 15. Subsequent Events None. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
Risks and Uncertainties | Risks and Uncertainties The COVID-19 pandemic continues to rapidly evolve and has adversely impacted global commercial activities. Management expects COVID-19 related changes in market and investor behaviors to impact our asset- and spread-based revenue. However, given the uncertainty around the duration and extent of the COVID-19 pandemic, management cannot predict the impact on the Company’s results of operations, financial condition or liquidity in the third quarter for 2020 and subsequent periods. Estimates and assumptions about future events and their effects on the Company cannot be determined with certainty and therefore require the exercise of judgment. The Company is not aware of any specific events or circumstances that would require the Company to update its estimates, assumptions and judgments or revise the carrying value of its assets or liabilities. The Company will update the estimates and assumptions underlying the consolidated financial statements in future periods as events and circumstances develop. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements – Adopted In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which requires lessees to recognize leases on-balance sheet and disclose key information about leasing arrangements. The new standard establishes a right-of-use (“ROU”) model that requires a lessee to recognize an ROU asset and lease liability on the balance sheet for all leases with a term longer than 12 months. Leases are classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the income statement. The Company adopted the new standard on January 1, 2020 using the modified retrospective transition method with certain available transitional practical expedients, and elected to apply the short-term lease exemption (described below) to all of its classes of underlying assets. The standard had a material impact on the Company’s condensed consolidated balance sheets, but did not have an impact on the Company’s condensed consolidated statements of comprehensive income. The most significant impact was due to the recognition of ROU assets and lease liabilities for operating leases. Adoption of the standard had no impact on previously reported results. The Company determines if an arrangement is a lease at inception. Operating leases are included in other current assets, operating lease ROU assets, accrued liabilities and other current liabilities, and long-term portion of operating lease liabilities on the Company’s condensed consolidated balance sheets. The Company does not have material finance leases. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligations to make payments arising from the lease. Operating lease ROU assets and liabilities are recognized at the commencement date based on the present value of lease payments over the remaining lease term. The Company uses an estimated incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. 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. The Company has elected to use the practical expedient to exclude the non-lease component from the lease for all asset classes. The majority of the Company’s lease agreements are facility leases. The Company’s leases have a weighted-average lease term of 7.6 years and used a weighted-average discount rate of 3.63% as of June 30, 2020. Future minimum lease payments under non-cancellable leases as of June 30, 2020 is as follows: Remainder of 2020 $ 2,225 2021 5,525 2022 5,872 2023 5,710 2024 6,084 2025 and thereafter 19,671 Total $ 45,087 In January 2017, the FASB issued ASU 2017-04, Intangibles, Goodwill and Other (Topic 350), Simplifying the Test for Goodwill Impairment, which removes step 2 from the goodwill impairment test. As a result, an entity should perform its annual goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount and should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value. The Company adopted the ASU on January 1, 2020 and it did not have a significant impact on the Company’s consolidated financial statements and related disclosures. In July 2018, the FASB issued ASU 2018-11, Lease (Topic 842) Targeted Improvements, which increases transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing transactions. The Company adopted the ASU on January 1, 2020 and it did not have a significant impact on the Company’s consolidated financial statements and related disclosures. In August 2018, the FASB issued ASU 2018-15, Intangibles, Goodwill and Other, Internal-Use Software (Subtopic 350-40), which provides guidance to evaluate the accounting for fees paid by a customer in a cloud computing arrangement. If a cloud computing arrangement includes a license to internal-use-software, then the software license is accounted for by the customer in accordance with Subtopic ASC 350-40. An intangible asset is recognized for the software license and a liability also recognized. The Company adopted the ASU on January 1, 2020 and it did not have a significant impact on the Company’s consolidated financial statements and related disclosures. In October 2018, the FASB issued ASU 2018-17, Consolidation, Targeted Improvements to Related Party Guidance for Variable Interest Entities, which clarifies the determination as to whether a decision-making fee is a variable interest by requiring reporting entities to consider indirect interests held through related parties under common control on a proportional basis rather than as an equivalent of a direct interest in its entirety. The Company adopted the ASU on January 1, 2020 and it did not have a significant impact on the Company’s consolidated financial statements and related disclosures. Recent Accounting Pronouncements – Not Yet Adopted In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740), Simplifying the Accounting for Income Taxes, which removes certain exceptions to the general principles in Topic 740 and improves consistent application of U.S. GAAP by clarifying and amending existing guidance. The new standard is effective for the Company on January 1, 2021, with early adoption permitted. The Company is currently evaluating the effect that ASU 2019-12 will have on its consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
Schedule of Future Minimum Lease Payments Under Non-cancellable Leases | Future minimum lease payments under non-cancellable leases as of June 30, 2020 is as follows: Remainder of 2020 $ 2,225 2021 5,525 2022 5,872 2023 5,710 2024 6,084 2025 and thereafter 19,671 Total $ 45,087 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Summary of Intangible Assets | Information regarding the Company’s intangible assets is as follows: June 30, 2020 Gross carrying amount Accumulated amortization Net carrying amount Estimated remaining useful life Indefinite-lived intangible assets: Broker-dealer relationships $ 570,480 $ — $ 570,480 Definite-lived intangible assets: Trade names 45,830 (8,402 ) 37,428 16 years Broker-dealer license 11,550 (2,117 ) 9,433 16 years ATC regulatory status 23,300 (4,272 ) 19,028 16 years GFPC adviser relationships 14,250 (1,230 ) 13,020 13 years OBS adviser and trust relationships 9,500 (251 ) 9,249 12 years Total $ 674,910 $ (16,272 ) $ 658,638 December 31, 2019 Gross carrying amount Accumulated amortization Net carrying amount Estimated remaining useful life Indefinite-lived intangible assets: Broker-dealer relationships $ 570,480 $ — $ 570,480 Definite-lived intangible assets: Trade names 45,830 (7,256 ) 38,574 17 years Broker-dealer license 11,550 (1,829 ) 9,721 17 years ATC regulatory status 23,300 (3,689 ) 19,611 17 years GFPC adviser relationships 14,250 (721 ) 13,529 13 years Total $ 665,410 $ (13,495 ) $ 651,915 |
Summary of Expected Future Amortization Expense for Intangible Assets | The expected future amortization expense for intangible assets as of June 30, 2020 Remainder of 2020 $ 3,385 2021 5,803 2022 5,803 2023 5,803 2024 5,803 2025 and thereafter 62,044 Total $ 88,641 |
Accrued Liabilities and Other_2
Accrued Liabilities and Other Current Liabilities (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Payables And Accruals [Abstract] | |
Schedule of Accrued Expenses and Other Current Liabilities | The following table shows the breakdown of accrued expenses and other current liabilities: June 30, 2020 December 31, 2019 Accrued bonus $ 8,376 $ 17,209 Compensation and benefits payable 7,834 7,591 Asset-based payables 3,752 3,718 Other accrued expenses 14,244 12,092 Total $ 34,206 $ 40,610 |
Other Long-Term Liabilities (Ta
Other Long-Term Liabilities (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of Other Long-Term Liabilities | Other long-term liabilities consisted of the following: June 30, 2020 December 31, 2019 Contractor liability $ 2,487 $ 3,083 Deferred compensation plan liability 7,804 6,885 Purchase commitments related to acquisition of GFPC 4,752 5,322 Deferred rent — 1,150 Total $ 15,043 $ 16,440 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Assets and Liabilities Measured at Fair Value | The following tables set forth the fair value of the Company’s financial assets and liabilities measured at fair value in the consolidated balance sheets as of June 30, 2020 and December 31, 2019, based on the three-tier fair value hierarchy: June 30, 2020 Fair Value Level I Level II Level III Assets: Equity investment and alternative investment securities funds (1) $ 420 $ 420 $ — $ — Assets to fund deferred compensation liability (2) 7,804 7,804 — — Total assets $ 8,224 $ 8,224 $ — $ — Liabilities: Deferred compensation liability (3) $ 7,804 $ 7,804 $ — $ — Total liabilities $ 7,804 $ 7,804 $ — $ — December 31, 2019 Fair Value Level I Level II Level III Assets: Equity investment and alternative investment securities funds (1) $ 390 $ 390 $ — $ — Assets to fund deferred compensation liability (2) 6,885 6,885 — — Total assets $ 7,275 $ 7,275 $ — $ — Liabilities: Deferred compensation liability (3) $ 6,885 $ 6,885 $ — $ — Total liabilities $ 6,885 $ 6,885 $ — $ — (1) The fair value of the Company’s rabbi trust, which comprises equity investment and alternative investment securities funds, is based on the month-end quoted market prices for the net asset value of the various constituent funds and securities, which mature on a daily basis. (2) The deferred compensation asset fair value is based on the month-end quoted market prices for the net asset value of the various investment funds. The Company recognized unrealized gains of $818, $(552) and $1,089 related to this asset within the statements of income and comprehensive income for the three and six months ended June 30, 2020, and for the year ended December 31, 2019, respectively. (3) The deferred compensation liability is included in other non-current liabilities in the consolidated balance sheets and its fair market value is based on the month-end market prices for the net asset value of the various funds in the Company’s rabbi trust which the participants have selected. The Company recognized other expenses of $818, $(552) and $1,089 related to this liability within the statements of income and comprehensive income for the three and six months ended June 30, 2020, and for the year ended December 31, 2019, respectively. |
Asset-Based Expenses (Tables)
Asset-Based Expenses (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Operating Costs And Expenses [Abstract] | |
Schedule of Asset-Based Expenses | Asset-based expenses incurred by the Company relating to the generation of asset-based revenues are as follows: Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 Strategist and manager fees $ 23,744 $ 25,518 $ 52,186 $ 48,121 Premier broker-dealer fees 2,689 2,444 5,748 4,536 Custody fees 1,585 1,275 3,115 2,449 Fund advisory fees 1,220 1,724 2,301 3,442 Marketing allowance 845 612 1,748 1,127 Other 1 52 1 52 Total $ 30,084 $ 31,625 $ 65,099 $ 59,727 |
Net Income Per Share Attribut_2
Net Income Per Share Attributable to Common Stockholders (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Reconciliation of Numerators and Denominators Used in Computing Basic and Diluted Net Income Per Share | The following table provides a reconciliation of the numerators and denominators used in computing basic and diluted net income per share attributable to common stockholders: Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 Net income (loss) attributable to common stockholders $ (9,280 ) $ 3,237 $ (6,544 ) $ 6,048 Weighted average number of shares of common stock used in computing net income (loss) per share attributable to common stockholders, basic and diluted 67,208,746 66,150,000 67,175,603 66,150,000 Net income (loss) per share attributable to common stockholders, basic and diluted $ (0.14 ) $ 0.05 $ (0.10 ) $ 0.09 |
Schedule of Securities Were Not Included in Computation of Diluted Shares Outstanding | The following securities were not included in the computation of diluted shares outstanding because such securities did not have a dilutive effect. Three Months Ended June 30, Six Months Ended June 30, 2020 2019 2020 2019 RSAs 2,239,929 — 2,136,795 — SARs 146,544 — 148,518 — RSUs 80,526 — 78,203 — Total 2,466,999 — 2,363,516 — |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional Information (Details) - Topic 842 | Jun. 30, 2020 |
Summaryof Significant Accounting Policies [Line Items] | |
Weighted-average lease term | 7 years 7 months 6 days |
Weighted-average discount rate | 3.63% |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Schedule of Future Minimum Lease Payments Under Non-cancellable Leases (Details) $ in Thousands | Jun. 30, 2020USD ($) |
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | |
Remainder of 2020 | $ 2,225 |
2021 | 5,525 |
2022 | 5,872 |
2023 | 5,710 |
2024 | 6,084 |
2025 and thereafter | 19,671 |
Total | $ 45,087 |
Acquisition of WBI OBS Financ_2
Acquisition of WBI OBS Financial, LLC - Additional Information (Details) - USD ($) $ in Thousands | Feb. 29, 2020 | Jun. 30, 2020 | Dec. 31, 2019 |
Business Acquisition [Line Items] | |||
Goodwill recorded | $ 338,848 | $ 327,310 | |
WBI OBS Financial, LLC | |||
Business Acquisition [Line Items] | |||
Final purchase price, net of working capital adjustments | $ 21,339 | ||
Goodwill recorded | 11,538 | ||
Adviser and trust relationships | 9,500 | ||
Deferred tax assets | $ 188 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Additional Information (Details) | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2020USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2020USD ($) | Jun. 30, 2019USD ($) | Dec. 31, 2019USD ($)ReportingUnit | Dec. 31, 2018ReportingUnit | |
Goodwill And Intangible Assets [Line Items] | ||||||
Goodwill | $ 338,848,000 | $ 338,848,000 | $ 327,310,000 | |||
Number of reporting units | ReportingUnit | 1 | 1 | ||||
Goodwill impairment | 0 | |||||
Amortization of Intangible Assets | $ 1,451,000 | $ 1,009,000 | 2,776,000 | $ 2,229,000 | ||
Impairment of intangible assets | $ 0 | |||||
Trade Names | ||||||
Goodwill And Intangible Assets [Line Items] | ||||||
Weighted average estimated remaining useful life | 14 years 7 months 6 days | |||||
Broker-Dealer License | ||||||
Goodwill And Intangible Assets [Line Items] | ||||||
Weighted average estimated remaining useful life | 14 years 7 months 6 days | |||||
ATC Regulatory Status | ||||||
Goodwill And Intangible Assets [Line Items] | ||||||
Weighted average estimated remaining useful life | 14 years 7 months 6 days | |||||
GFPC Adviser Relationships | ||||||
Goodwill And Intangible Assets [Line Items] | ||||||
Weighted average estimated remaining useful life | 14 years 7 months 6 days | |||||
OBS Adviser and Trust Relationships | ||||||
Goodwill And Intangible Assets [Line Items] | ||||||
Weighted average estimated remaining useful life | 14 years 7 months 6 days |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Summary of Intangible Assets (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2020 | Dec. 31, 2019 | |
Intangible Assets [Line Items] | ||
Definite-lived intangible assets, Accumulated amortization | $ (16,272) | $ (13,495) |
Definite-lived intangible assets, Net carrying amount | 88,641 | |
Intangible assets, Gross carrying amount | 674,910 | 665,410 |
Intangible assets, Net carrying amount | 658,638 | 651,915 |
Broker-Dealer Relationships | ||
Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets, Net carrying amount | 570,480 | 570,480 |
Trade Names | ||
Intangible Assets [Line Items] | ||
Definite-lived intangible assets, Gross carrying amount | 45,830 | 45,830 |
Definite-lived intangible assets, Accumulated amortization | (8,402) | (7,256) |
Definite-lived intangible assets, Net carrying amount | $ 37,428 | $ 38,574 |
Definite-lived intangible assets, Estimated remaining useful life | 16 years | 17 years |
Broker-Dealer License | ||
Intangible Assets [Line Items] | ||
Definite-lived intangible assets, Gross carrying amount | $ 11,550 | $ 11,550 |
Definite-lived intangible assets, Accumulated amortization | (2,117) | (1,829) |
Definite-lived intangible assets, Net carrying amount | $ 9,433 | $ 9,721 |
Definite-lived intangible assets, Estimated remaining useful life | 16 years | 17 years |
ATC Regulatory Status | ||
Intangible Assets [Line Items] | ||
Definite-lived intangible assets, Gross carrying amount | $ 23,300 | $ 23,300 |
Definite-lived intangible assets, Accumulated amortization | (4,272) | (3,689) |
Definite-lived intangible assets, Net carrying amount | $ 19,028 | $ 19,611 |
Definite-lived intangible assets, Estimated remaining useful life | 16 years | 17 years |
GFPC Adviser Relationships | ||
Intangible Assets [Line Items] | ||
Definite-lived intangible assets, Gross carrying amount | $ 14,250 | $ 14,250 |
Definite-lived intangible assets, Accumulated amortization | (1,230) | (721) |
Definite-lived intangible assets, Net carrying amount | $ 13,020 | $ 13,529 |
Definite-lived intangible assets, Estimated remaining useful life | 13 years | 13 years |
OBS Adviser and Trust Relationships | ||
Intangible Assets [Line Items] | ||
Definite-lived intangible assets, Gross carrying amount | $ 9,500 | |
Definite-lived intangible assets, Accumulated amortization | (251) | |
Definite-lived intangible assets, Net carrying amount | $ 9,249 | |
Definite-lived intangible assets, Estimated remaining useful life | 12 years |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Summary of Expected Future Amortization Expense for Intangible Assets (Details) $ in Thousands | Jun. 30, 2020USD ($) |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Remainder of 2020 | $ 3,385 |
2021 | 5,803 |
2022 | 5,803 |
2023 | 5,803 |
2024 | 5,803 |
2025 and thereafter | 62,044 |
Definite-lived intangible assets, Net carrying amount | $ 88,641 |
Accrued Liabilities and Other_3
Accrued Liabilities and Other Current Liabilities - Schedule of Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Payables And Accruals [Abstract] | ||
Accrued bonus | $ 8,376 | $ 17,209 |
Compensation and benefits payable | 7,834 | 7,591 |
Asset-based payables | 3,752 | 3,718 |
Other accrued expenses | 14,244 | 12,092 |
Total | $ 34,206 | $ 40,610 |
Other Long-Term Liabilities - S
Other Long-Term Liabilities - Schedule of Other Long-Term Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Other Liabilities Disclosure [Abstract] | ||
Contractor liability | $ 2,487 | $ 3,083 |
Deferred compensation plan liability | 7,804 | 6,885 |
Purchase commitments related to acquisition of GFPC | 4,752 | 5,322 |
Deferred rent | 1,150 | |
Total | $ 15,043 | $ 16,440 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Financial Assets and Liabilities Measured at Fair Value (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Assets: | ||
Total assets | $ 8,224 | $ 7,275 |
Liabilities: | ||
Total liabilities | 7,804 | 6,885 |
Level I | ||
Assets: | ||
Total assets | 8,224 | 7,275 |
Liabilities: | ||
Total liabilities | 7,804 | 6,885 |
Equity And Alternative Investments Securities Fund | ||
Assets: | ||
Total assets | 420 | 390 |
Equity And Alternative Investments Securities Fund | Level I | ||
Assets: | ||
Total assets | 420 | 390 |
Assets To Fund Deferred Compensation Liability | ||
Assets: | ||
Total assets | 7,804 | 6,885 |
Assets To Fund Deferred Compensation Liability | Level I | ||
Assets: | ||
Total assets | 7,804 | 6,885 |
Deferred Compensation Liability | ||
Liabilities: | ||
Total liabilities | 7,804 | 6,885 |
Deferred Compensation Liability | Level I | ||
Liabilities: | ||
Total liabilities | $ 7,804 | $ 6,885 |
Fair Value Measurements - Sch_2
Fair Value Measurements - Schedule of Financial Assets and Liabilities Measured at Fair Value (Parenthetical) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended |
Jun. 30, 2020 | Jun. 30, 2020 | Dec. 31, 2019 | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Unrealized gains on deferred compensation asset | $ 818 | $ (552) | $ 1,089 |
Other Expenses | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Deferred compensation liability | $ 818 | $ (552) | $ 1,089 |
Asset-Based Expenses - Schedule
Asset-Based Expenses - Schedule of Asset-Based Expenses (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Operating Costs And Expenses [Abstract] | ||||
Strategist and manager fees | $ 23,744 | $ 25,518 | $ 52,186 | $ 48,121 |
Premier broker-dealer fees | 2,689 | 2,444 | 5,748 | 4,536 |
Custody fees | 1,585 | 1,275 | 3,115 | 2,449 |
Fund advisory fees | 1,220 | 1,724 | 2,301 | 3,442 |
Marketing allowance | 845 | 612 | 1,748 | 1,127 |
Other | 1 | 52 | 1 | 52 |
Total | $ 30,084 | $ 31,625 | $ 65,099 | $ 59,727 |
Debt - Additional Information (
Debt - Additional Information (Details) - USD ($) | Jul. 26, 2019 | Nov. 14, 2018 | Jun. 30, 2020 | Mar. 31, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 |
Debt Instrument [Line Items] | |||||||
Interest expense | $ 1,474,000 | $ 4,031,000 | $ 3,101,000 | $ 8,055,000 | |||
Credit Agreement | Credit Suisse AG | |||||||
Debt Instrument [Line Items] | |||||||
Interest expense | 1,474,000 | $ 4,031,000 | 3,101,000 | $ 8,055,000 | |||
Credit Agreement | Credit Suisse AG | Revolving Line of Credit | |||||||
Debt Instrument [Line Items] | |||||||
Maximum borrowing capacity | $ 20,000,000 | ||||||
Credit facility, maturity date | Nov. 14, 2023 | ||||||
Credit Agreement | Credit Suisse AG | Term Loan | |||||||
Debt Instrument [Line Items] | |||||||
Maximum borrowing capacity | $ 250,000,000 | ||||||
Term loan, maturity date | Nov. 14, 2025 | ||||||
Partial repayment of outstanding indebtedness | $ 125,000,000 | ||||||
Debt instrument, amount outstanding | $ 123,700,000 | $ 123,700,000 | |||||
Credit Agreement | Credit Suisse AG | LIBOR | Revolving Line of Credit | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, margin percentage | 3.00% | ||||||
Credit Agreement | Credit Suisse AG | LIBOR | Term Loan | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, margin percentage | 3.00% |
Share-Based Compensation - Addi
Share-Based Compensation - Additional Information (Details) $ / shares in Units, $ in Thousands | Jun. 09, 2020USD ($)shares | Jun. 30, 2020USD ($)shares | Jun. 30, 2020USD ($)$ / sharesshares | Mar. 31, 2020Installment |
Restricted Stock Awards | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Exchange of shares with stockholders on liquidation | 6,309,049 | |||
Vesting percentage | 50.00% | |||
Number of equal vesting installments | Installment | 3 | |||
Vesting upon satisfaction of condition | 50.00% | |||
Vesting description | 50% of the RSAs scheduled to vest in three (3) equal installments on the third, fourth and fifth anniversaries of November 18, 2016, subject to the recipient’s continued employment through the vesting date, and 50% subject to the recipient’s continued employment through February 1, 2021 and the satisfaction of a performance-based vesting condition. | |||
Share-based compensation expense | $ | $ 12,782 | $ 25,034 | ||
Stock Option | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Share-based compensation expense | $ | 583 | 1,167 | ||
Restricted Stock Units | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Vesting description | Each of these RSUs is scheduled to vest in substantially equal installments on each of the first four anniversaries of June 9, 2020. | |||
Share-based compensation expense | $ | 431 | 783 | ||
Restricted stock units granted under the plan | 296,884 | |||
Stock Appreciation Rights (SARs) | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Vesting description | Each SAR has a strike price equal to the fair market value of the Company’s common stock on the date of grant and is scheduled to vest and become exercisable in substantially equal installments on each of the first four anniversaries of June 9, 2020 | |||
Share-based compensation expense | $ | $ 138 | $ 138 | ||
2019 Equity Incentive Plan | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Share available for issuance under the plan | 3,672,918 | 3,672,918 | ||
2019 Equity Incentive Plan | Stock Option | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Vesting description | Each of these options is scheduled to vest and become exercisable in substantially equal installments on each of the first three anniversaries of July 18, 2019. | |||
Number of shares, granted | 918,981 | |||
Exercise price | $ / shares | $ 22 | |||
2019 Equity Incentive Plan | Restricted Stock Units | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Restricted stock units granted under the plan | 85,737 | |||
2019 Equity Incentive Plan | Stock Appreciation Rights (SARs) | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Share available for issuance under the plan | 819,844 | |||
Grant date fair value of shares | $ | $ 7,764 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Income Tax Disclosure [Abstract] | ||||
Federal corporate tax rate | 21.00% | |||
Effective tax rate | (167.10%) | 50.40% | (292.30%) | 52.70% |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) - USD ($) $ in Thousands | Jul. 31, 2020 | Jun. 30, 2020 | Dec. 31, 2019 |
Subsequent Event | |||
Related Party Transaction [Line Items] | |||
Receivable balance | $ 149 | ||
Huatai Securities Co., Ltd. | |||
Related Party Transaction [Line Items] | |||
Receivable due from related parties | $ 149 | $ 0 |
Net Income Per Share Attribut_3
Net Income Per Share Attributable to Common Stockholders - Schedule of Reconciliation of Numerators and Denominators Used in Computing Basic and Diluted Net Income Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Earnings Per Share [Abstract] | ||||
Net income (loss) attributable to common stockholders | $ (9,280) | $ 3,237 | $ (6,544) | $ 6,048 |
Weighted average number of shares of common stock used in computing net income (loss) per share attributable to common stockholders, basic and diluted | 67,208,746 | 66,150,000 | 67,175,603 | 66,150,000 |
Net income (loss) per share attributable to common stockholders, basic and diluted | $ (0.14) | $ 0.05 | $ (0.10) | $ 0.09 |
Net Income Per Share Attribut_4
Net Income Per Share Attributable to Common Stockholders - Schedule of Securities Were Not Included in Computation of Diluted Shares Outstanding (Details) - shares | 3 Months Ended | 6 Months Ended |
Jun. 30, 2020 | Jun. 30, 2020 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive Securities were not included in computation of diluted shares outstanding | 2,466,999 | 2,363,516 |
Restricted Stock Awards | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive Securities were not included in computation of diluted shares outstanding | 2,239,929 | 2,136,795 |
Stock Appreciation Rights (SARs) | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive Securities were not included in computation of diluted shares outstanding | 146,544 | 148,518 |
Restricted Stock Units | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive Securities were not included in computation of diluted shares outstanding | 80,526 | 78,203 |