HLNE - Earnings call transcript Q4 2021 | Hamilton Lane Incorporated

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Operator

Thank you for standing by. And welcome to the Hamilton Lane Incorporated Fourth Quarter Fiscal Year 2021 Earnings Conference Call. At this time all participants have been placed in a listen-only mode. [Operator Instructions] Thank you. I’ll now turn the call over to John Oh, Manager of Investor Relations to being. ahead. go Please

John Oh

and Good and QX Maria. be welcome the Lane Vice to by Kramer, Chairman; Thank of Varma, CEO XXXX morning CFO. earnings Lane Hamilton Chairman; Hirsch, Erik fiscal Giannini, Holdings will Hirsch call. Hamilton Vice Mario Andrea One; you, Alliance CEO; and Erik Atul Today joined I

are on differ Before subject actual business. be making will you that we discuss we uncertainties the and the risks results for quarter’s statements to results, our based that we These the expectations statements want materially. to remind cause current forward-looking may to

For a fiscal factors XXXX risks, filed review Lane's included subsequent and the SEC. reports we discussion risk of these XX-K with Hamilton in the the please

that the non-GAAP in in section we view also Hamilton available will be GAAP materials We as made Lane performance website. of the those our on measures assessing business. measures Reconciliation to earnings presentation found can shareholder be referring the non-GAAP the of important of to

net GAAP grew of income. fee advisory year This million and revenue $X.XX adjusted $XXX Our the note that net management grew versus EPS be related into based detailed million non-GAAP of based products. Slide Please offer this in represents earnings translated call solicitation purchase is on on to by GAAP EPS our for our interest Beginning made our an XX-Q Lanes’ XX% of to financial X, full any fee income by of available or nothing XX%, fiscal of filed. while a when year Hamilton results year. sell and the $X.XX $XX prior on will

Mario. per dividend share, per annual increase or to Board to I’ll the our a share has that $X.XX per Lastly, With turn over fiscal now to call $X.XX our approved quarter. XX%

Mario Giannini

good John. Thanks, morning. And

year fiscal start. a off busy to been has Our

employees outside normal continues week remotely, two travel. some of We're of modest are seeing the that. of While prospects our are already of And see overseas. returning path toward to of of beginning the visiting senior U.S. clients much and in clear experiencing we saw to our work majority colleagues also to return May some workforce a the the and first

each along strong are closely We vaccination trend and numbers, positive region with situation continues. optimistic that monitor this cautiously to continue

Moving his for at American has and to few the Vann which months. an March a new Vann past University. accomplished director, is as of the highlights Martin Over our Directors directors including Brandcenter On career important of world's are increased U.S. the today brands, Commonwealth Board Army, of the the Lockheed MasterCard, the brand lengthy been Van four Airlines. the independent. and Graves marketing X, whom of of leads size seven independent board Virginia executive, responsible and appointed some of most

focused being and In movement. He addition, board Van mentor. both university, the Harvard University, his of Institute, X% has career Harvard holds member the agent Pennsylvania. an spent a is of well University Pratt on XXX change as much Rising the and from a of & degrees Van of as

into scale perspective. our and very to excited channel, our as We're experience from our grow to business into continue look and continue and to the Van's we As expansion globally, team. welcome will benefit we we retail

not to taking two this private enhanced strive who move solutions, this clients beneficial, best million OCIO solutions a products, and to around Russell's together research will access service a Lane partnership announced commitment We demonstrate we world. markets a our global tailored the the and March private like-minded innovative capabilities partnership, CIO strategic the quick investment meet but leading and as to to data-driven around see from the certain the To mutually goals together invested rather client offer our bringing provide exceptional outsource in global to the clients integrated equity have view markets investment sheet Next our to and partnered Russell's positioning as provide with access share win, Russell long-term believe in We our balance with for commitment comprehensive providing and with on markets customized institutions XX, the OCIO of leaders parts Russell's this objectives. as a We we private technology Hamilton and minority returned clear one from tools. just industry-leading stake with $XX Investments. of client's Russell. will solutions, market that in very to space. partnership and our

for Consistent increase Let we the trend. and on here growth prior advisement. we client highlight which me AUM our of was the of size footprint, our sum asset our the XX% continuing year-over-year, across year-over-year, or of the under geographic XX% both funds from was at to under the assets as Total billion billion entirety specialized our US$XXX our across separate asset to strong type, continues accounts represents define and growth diversified approximately footprint now Beginning be a assets with management, $XX which X, AUM, which total stood client came customized quarters and region. Slide and results long-term to turn quarter for and this year, the fiscal AUA, business. footprint

our of across Our focus are and remains lines both pleased with business. growing success. we ongoing And winning simply

seen at As geographic type region. was client our for or to AUM XX% across year-over-year, billion AUAs, our approximately similar approximately which $XXX and from in growth came what with was

AUA of fixed and with very office a is Although year-over-year us on to dollar of number from large clients relatively portfolios. new the existing engaged being basis to provide a the majority services reporting back increase fee from a portfolio standpoint, resulting large is change and the percentage

reasons, of move AUA on with the fluctuate for necessarily associated but nature fee prior not As we changes of many mentioned lockstep the calls, in can to revenue cases the business. quarter-to-quarter fixed with due a does in variety those AUA

database relationships. note, of is more to continue as expands AUA our number it however, We that and positive a

turn not Eric. to it me over Let

Erik Hirsch

And you, good Thank Mario. morning.

on our Slide AUM. X, Moving we to fee-earning highlight

management specialized accounts with basis As funds combination point of fee-earning reminder our customized a is driven fees. AUM our the and separate

is We will of business positive to total XX% that to as customized funds year management AUM flows specialized of over separate $X.X the billion fund fees. continue the it most our prior grew and significant X% Relative across from fee-earning emphasize makes our advisory our and our driver up both stemming accounts. or this

accounts. net billion segments And our $X.X separately, from specialized customized period, of the these funds. Taken billion over our came two separate $X.X in came time same Growth AUM fee-earning from winning new clients; four fund re-ups adding and three, one driven funds. by components: clients; our for existing from growing to be continues key two, new platforms specialized our raising existing and

fee remains combined rate our Additionally, steady.

growing billion over Slide months. the AUM to X, XX accounts past fee-earning Moving our stood at customized separate from X% $XX.X

XX We that growth see the last over also clients. to accounts the XX% you gross here from type, more continue separate of across size coming came and see What customized the inflows is clients. than location geographic these months, existing of into

say fee You've that component of base past existing the the in in re-ups we've segment AUM. client our from the of remains the achieved earning heard us growth a key

opportunities. turn to and adding provide expand addition re-ups, re-up winning our in new for by base future brand which relationships, a In we growing base client to continue

creates related on seems address are the When actual some commitment, let to a I separate client CSA, causing funded move making be a accounts. still topic being on, customized confusion. a account. that Before they me outflows an to That

CSA. are generated based we proceeds then the that This markets is returned, Further, manager is as CSA liquidated begin fully our on then that is the the a to returned are have returned opportunities, is exit This result those from CSA fund is fee the fee their client. not asset and down investments Thus, exited, is outflows to net that ultimately to is of time, longer to the step good or shutting down, client. a fund basis, cash. their the identifies full investment is Not private opportunity. have good and tranche mean opportunities, is to to client. healthy thing. you've any just CSA typically From cash CSAs exposure the From returned committed capital so As investment the causing the cash for a and zero have a are gain perspective, identify exposure, fee should that thus exited it as our to committed not a it drop. always Over as client outflows. a converts no invested client's results nor as is an thing. That to funds perspective, the going in on class capital that the fee To most is amount. the They activity, on the fee amount. would underlying in client that called withdrawing their investment retained never of account, not the not

maintain their not So, they they at to see align in CSA. ending, the levels for and re-up their of of. to add the re-ups for. tranche beginning reality hence another predecessors. often are always most, exposure, perfectly redeploy capital They order often dynamic or need another their speak we to dollars. need existing class, to create asset to allocation those CSA This the simply The that one are simply occurring we looking than however, tranche timing and is maintain they seeking larger next that increase to The of doesn't is to

client occur we a their their nature own comes focus, This just CSA exited, in to its process Each is deploy. asset the flow best undertake does. a a replacement quarters long-term then with capital of contracting of can quarter result tranche rarely to certain it the the given whether who not don't we determines this where gets whole quarters for fact, money is where class or has invested, and gets they In factor returned starts end, when concurrently. and This big client now from in, but two see how, them. capital see during the

don't that very inflows, raising while do moving. about management on can outflows, not that something focused new yield I we is spending that tell we the we're As all thinking that time, assets, control you

be our growth Moving to funds, specialized continues strong. here to

tactically across globe. suite demand are and We lines. robust business of remains our are from executing comes diversified our like of around well product and product Overall, investors rest new the set introducing the a existing

the over we've of billion positive inflows in AUM. past increase and fear XX% in XX achieved a months, $X.X Over resulting

announced fund close fund secondary we the XX, supported And updates. of this we've On approximately commitments. LP capital final have the Turning all to the we have largest on ever fund-specific and who of is with platform. now fifth our $X.X are who It of us investors appreciative February growth billion raised. entrusted the to specialized

this fourth fiscal this of relates during resulted commitments retro prior similar retro $XX.X As closed to product, it quarter, closes to $XXX million with fees, of which LP fees. million in

announced we nearly commitments. X, up credit-focused our March we've ever Next $XXX final of of the million is annual close largest in the series of the installment marks raised. at the series On series. sixth debt LP This

credit traditionally less are the As fees amount set that strategy current opportunity relatively deployment And it our has about you across size raising of series. on would and some that series from ensuring a with in a to management deploying continually and a we raise multi-year a set. whereby more period. structure And lead funds earning with we the see product can size dollars dollars unique Therefore, it's capital. simultaneously variability invested to about line targeting reminder, is as to

We interest continues be strong. our investor and with are market the next in to series already

name, clarify and the any Moving our fund direct confusion was this here formally on to to around our fund. called fund co-investment equity

close are fund of I'm the companies, we announce We brings with private XXXX managers. previously in fifth in our but in which held this we private at our October equity communicated of we do raised partnership and total over million, commitments. this we LP had million pleased past closed on of investing that commitments. another this fund of the for on first dollars LP nearly during fund that back to $XXX strategy equity Here, $XXX quarter, positions to million the $XXX directly now various

option management the our X% the fee for invested of carry we this on on fund, capital a presented with a on or committed net with As XX.X%. XX% highlighted traditional were fee prior capital investors with X% management carry call a of

listen fee end to the choice. confirm as different that thoughtful have see invested. provide and fees management period. decision $XXX that was over the investors market The were we in for to fund so making there our raised activated of and is this serves net types stands, the XX% sensitivity and committed to the such, were of XX% after it million for to far fiscal the and reflective as retro no areas We that year As different mix

and the shown with demand strong for date being are product. around the We globe this pleased to the success

to raise months for first We this complete closing the from have XX product. the

be And so to through expect market we October, XXXX. in

product. shift speak our now strategy launched been and U.S. our complements two start semi-liquid about as our Let officially had which in me It XXXX almost exciting gears for years. the sleeve we been that have for Evergreen has an the retail for offering non-U.S. market now [ph]

As as Capital to call, the U.S. well their acquired the we XXX has product. supplement marketing that efforts offering The officially closed we distribution discussed in been and last have for our XXX efforts and now integrated with in underway and the distributing U.S. transaction. team

deal two strategy. combined strategy we've demand early and regions of into remain Evergreen still stands thus While and it we pleased to at Currently, the to products great success NAV, value, and the in interest see the continue momentum far. continuing the billion. generated a gross are Overall, for the we is now world. for days, strong, we gain different over around net $X the inflows asset traction are Monthly with

now industries College Lane all business Hamilton its Business analytics University's of XX. that a recognized that annual was sizes me all Drexel XX judged LeBow data-driven proud solve honoring organizations of to is across are be LeBow turn challenges. analytics to and and Drexel to technology using This Let competition side. to national announce the I'm by

Rackspace, year Verizon, outstanding a firms, PwC. are with find named Ancestry.com, Pfizer, proud company and and including be Chewy, We ourselves to Nestle, winning other winner this in

commitment using clients see to is and very And investment inform making to and – acknowledged better rewarded. our decision to are and unrelenting. Our technology our benefit to making data we proud it

of on to with provide Market update joint IHS June I our Connect XXXX. created a venture in We Private Next, PMC. want or company Markit, an called

a look PMC and had key senior which level scaling, by limited flow year, to As straight both data and refresher, say approved payment still the on future. automating offering partners through dividend investor remain way now general excess PMC the reductions data updates IHS payment to stemming LP which from card managed customer. cash additional in the to generated to on offering its benefit by primarily focuses of between information and SaaS I'm we shareholders. a the with shareholders includes as high financials. which third adjustment, the Hamilton adjustments, provide to I'll continuing in Board Board PMC, processing. quick providing the early Atul over to the services well dividend the of And as that, normalizing partners cover of supports has a continues that another and We pleased forward of two two this members turn Lane along Markit an call G&A approved were PMC rate PMC. Prior from to a goal rate card with to now HLNE with

Atul Varma

Erik, year of presentation Thank fiscal XXXX. X good and Great. the financial the highlights shows Slide for you, morning, everyone.

see with and in up over the continue fee business management growth to year. solid prior our versus advisory XX% We

prior $X.X year million funds year the increased compared specialized $X.X from this Our secondary AUM secondary fiscal our in fees by to XXXX, fund year. from fund the $XX.X XX% retro revenue from $XX.X to year. compared We in co-investment driven fee recognized in or million million the in earning a latest billion added prior fund

our to which $X.X first you quarter, compared compared customized As due million, for unrealized fee many to the the and million to Revenue separate The Incentive advisory to come increased to clients that of and to subsequent you fee see both year for was our prior prior the back offerings later to related are realizations several likely from to $XX.X carry. of million closings increased from investors of our occur. into approximately reups continued pay products close. strong reporting increased in diversification incentive fund fee. that fund our fund prior year Therefore, and many aware, new the due spike a retroactive million revenue dating $XX.X of closes $X.X accounts from typically realized component addition the final in existing compared our of and management the accounts. Revenue the year. fees raise

unrealized ultimately XX nearly in that by companies. have backed underlying thousands position vehicles carried We are of

We Moving detail provide additional X. some to Slide carry our on balance. unrealized

continued the And remind period. fee during of Given positive as timing prior XX% $XX of don't control million to we just year of control we everyone, trend valuations, thus balances the the recognized incentive from in don't positions the the exit. and that these even

earnings. Turning our to Slide profiles which XX

up year year. nearly million performance million revenue compensation total result $XX.X XXXX prior decreases growth consulting increased due we regard to strong to $XX.X increased prior were professional travel increase count. benefits In an versus and as year and expenses, fiscal fee. fee-related and G&A the a discussed with XX% operating due earlier. million the Total in $X.X of head earnings in and expense Our expenses compared the primarily to our decreased

and we the financials. milestones the in we de-SPAC SPAC and monetization now and have control financial the as marketing result, of SPAC IPO, that a the Currently, consolidate of Moving There Alliance that the it call, the proceeds. results of SPAC will million a the SPAC SPAC SPAC They treatment relates first moment life prior the around wanted Holdings only completed are that I the Hamilton transaction detail are completion and and to provide this of position. to cycle to of XX, as impact IPO entity. our Slide the three we we more as We our our take highlighted $XXX a was past our gross January Lane financial totaled statements. raised on

and period primarily mark largest fair income balance equity. longer no market it financials and will and And an identified Once then SPAC be This asset we entity our shares complete then statement. to we'll to value. control financials the the warrants on we is deconsolidate we sheet, on under in will recognized remaining impact the look This these our our have process, mark de-SPAC revenue lock-up of Over public sign. the the on we founder in we'll continue also as monetize the on section. accordance be our at cash but the all then the will discretion income with other as our value investment our on in balance and total quarter, the to change agreement, shares, statement will reflected with sheet one the income to and the time the position price the based trading from next value shares to included

sheet separate Slide the largest specialized to accounts customized balance on XX, funds. alongside balance is on in client investment Moving our our asset our our sheet and

Investments modestly saw quarter our that And to Mario to the to $XX liabilities, continue to open we changes the investment in levered questions. with increase in call value even it with fund joining previous we balance be our happy this earlier. to regard This In Investment. we quarter an the Russell with relative and increase use due quarter discussed the Russell for you thank debt to in the the valuation that, increase that along up million for

Operator

Cyprys question of of comes Thank [Operator from Our Stanley. Instructions] Michael Morgan you. first line

Michael Cyprys

Thanks question. Hey, taking for the good morning.

to want more growth. a management dive little on Just the in bit fee

I against do the for about, How years looking growth persisting? upside to gets you past out be downside a that management there CAGR slows? that management guess, of strong think had maybe do pace years, or you the accelerate? the that, you that just sort be And fee XX% You five think do think the on five perhaps could any growth some and and over how over see fee next Do that could about to there? how very how think around put up scenario about it numbers do for you where so. potential where rate And you may guys XX% downs persist? ups

Erik Hirsch

it's I'm Sure. to Erik. Mike, take that. happy

from double our So see story think beginning I as ourselves obviously very a digit We followed I think grower. been you've we've consistent. if, the and

we obviously And have itself a industry think sort leader, position. of asset as just as of market get tailwind strong by I factors. market of benefit the driven a two the class. the two growing One, we

past continues lot what bigger driver the And mix we're now so time. saw while in certainly from had of retail. year-to-year, we year, you even or And quarter-to-quarter of and obviously this a much seeing at to given the market drive a specialized evolve coming change, funds

deliver of there. Our outlook remains consistent sort around we can what

think be thus steady environment accelerating unbelievable I tailspin, some think tremendous great we're the if economy a dropping, not facing and markets I that a rapidly headwind remaining numbers. the obviously, kind That's things macro, not But public value public don't the of that are in or is sort plan is at overall – and steady we they does relatively of a markets to a in. be mean putting need up dropping. to

gaps we've I we any our where of kind of in think where those remains extreme kind expectations movements, of been are of historically.

Michael Cyprys

be arguably on pieces you five that but some that, on the the think just the of something may And to the bit over years a follow-up didn't component contributing in you the you you example, do they of elaborate could business terms next, guess, about over deeper how that? going For past of Great. other five contributing drive see years little and the strategy, new underpinning evolving? How products the mentioned how be obviously are are that? upside and have maybe acceleration just you could Evergreen I that maybe to just pieces next an extensions, the see retail do to past among years, growth that over to you just what relative a how five but your dive drivers maybe

Erik Hirsch

Erik. stick this. It's with I'll Sure.

much of experiencing over class to strong, us demand what totality market. we've product the a offerings, strong, asset allowing for remain class kind the of years. is That we're address past being asset full offering the So the to suite today experienced of and I what market that remain within of think the similar very our five we're position very

next continuing to that offerings for. see product I for years? I asking expand One, do market's of what think So the the to suite what five we're in response

So products. just you found us impact reflecting out and Whatever kind is, to suite technology I that's new offerings product that see to our mix addressing our whether that's adding or that's an continues whether widen think of what for. the office five while market's years. the worth piece truly looking in family new, sort the net playing retail had over thing The of is that's ultra last one certainly and high space been we of the

I think what Evergreen is we've more affluent. moved this to now much with mass the vehicle of

is up a completely launches two And can so And think nothing new with us. have for we well market exceptionally of that vehicles be I opening gone. how but pleased those channel the

billion $X those the pandemic. reaching which is that enormous accomplishment, fact raised we the assets have all during at about think think pace been vast the the particularly did you when of at majority I mark the

early we to can I us, what baseball in say still for is optimistic long but to a very, use an So channel analogy, be extremely think about game. very the what we that very deliver would innings we're remained going

Michael Cyprys

Great. the back Thanks much. in I'll so queue. get

Operator

question Worthington one Ken next JPMorgan. of from comes Our of

Ken Worthington

And Hi, I there. follow thank up wanted good morning. you. to

XXX in Capital. not the with process but So I only speak wealth you've started the on the further you to I mentioned channel. management to integration wanted get that expansion closed, have

selling much retail where you So you on product – where product out the platforms getting Are stand – or guess how your Evergreen of your How platforms product? Capital on the build selling on your have retail far people this point? I you at this Evergreen XXX salesforce? penetrated the retail your does salespeople in also target? a along products your are the sales And the total bring alongside XXX

Erik Hirsch

a lot Ken, it's There's Erik. there.

that. Let me unpack to try

in take So this pieces. let me

So sort if retail in look with distribution team that now at the – team you're integrated the XXX fully Lane preexisting the absolutely has Hamilton right you U.S. so distribution of been

the outside know, you does XXX As not U.S. of operate

team the solely And or spending has They're off separate happened. while under of races. is of growth of U.S., they're them existing Lane who to product is the products. Evergreen single territories salespeople created, XXX that team picture growth growth organization the important, Lane a nothing, focused time do majority into the that's structure, our a focused and of on and are selling solely now That that products the migrating not of U.S. are slightly not the the every lane selling have accounts focus in territory. sort the Hamilton in management today. The the on around the focus is it's been Hamilton not the Evergreen. So aligned retail while is They different any but the Outside Hamilton true

different of So depending lot on some who frankly, from kind across the the person benefit having they're a and focused the of U.S., more cutting territories there's some of geographies things is that outside one selling. on

is that So by really kind of region. driven region

think people. I sort at of salespeople, numbers, XX we're looking the all of about rough you total think when up I

good have like we we So start. feel we're – a

hires, You outside noted, additional the we've some particularly U.S. made

are this of market We as segment, a huge and this to see to lot do. continuing grow is as we to just look a – there's work

want grow if the And no. we're the that question we platforms that is, a with fact here. all you of and resounding terms ahead answer would billion the say to the to $X at be penetration, that you – already The on you room are to is of a us answer if I In there say platform that, is again, able tells lot think the on? being

sort first quarter the calendar final U.S. received its So kind year. year, of permissioning of product the only that of

certain lot again, you people, for to get here start just, lot a of platforms. well they got it's to a size And work early know, a want of larger so, and to think as it's we've you before they to do. contemplate I But

at being puts a think I in billion position. good $X us

Ken Worthington

very Great. much. Thank Awesome. you

Operator

Lee Our Robert from question KBW. next comes of

Robert Lee

five, questions. good flattish accounts, if guess revenue, you've six quarters it continued separate steady morning. kind does the at I that like guess for I first growth. look it's grow to Great, maybe I like the underlying the on is been now my – But a thanks look of despite taking for And one at pace.

maybe talk of little the some accounts kind just or seeing of are going as if think that just you repricing capital and is these So, are that new pressures – way, kind should bit we competitive about you kind forward? of there, of a is deployed how that

Erik Hirsch

it's Rob, I'm that. take to Erik, and Sure. happy

to factors. for on given of I kind really calls, one, model addressed would point we sort prior service heavy of two our is And client and had focus. our which So us

pandemic to visit XX-year completely world kind it discretionary together, some relative to easier huge, where clients found of a to have do. prospects team, just us, have fully that's sort bespoke, basis, We hard been and product a the meet to in visit sell relationship it been meal sell on like and stuff, a than come offices, our has of

I reverses relative easier So product sort been move a right to little now on basis, specialized that. of it's think a

some credit The to addition. this want going if second J-curve exposure. $XXX before and of thing think I mitigate kind But XXX and have to sometimes We might client I'd portion is point I million. XX comes fund that a my start secondary building to fund the lost it's a gets here's I out hey, though, point, which and an that, important is of says, I out in the fund that in or sure make of going the primary of sort

the some traditional And then account some that portion later. customers, separate their strategic product accomplish product of some of of more kind out beginning of the of objectives. the So the begin result you're we separate with is building to account seeing relationship is – growth

two think things. it's the really I of So those combo

Robert Lee

maybe Okay, great. little of Then a extension another question. to bit

some had the compensation SPAC-related there’s you SPAC the in So quarter, G&A.

up that out and runway? of thinking every a of So, a being period. you go-forward taking of of that coming shouldn't or to think the think be be comp down SPAC or marked kind should kind trying quarter that of basis done, that the is is we over Just way we on the one

Atul Varma

Rob, that Hey take Atul. Yes. I'll it’s one.

to we success certain a of because We compensation the wanted SPAC to success is one-time For the thing. awarded related employees with SPACs. the their warrants to align the –

thing. that's not recurring a So

un-consolidate we of we'll expense you see the broke expenses. The financials, as SPAC out, other in the we de-SPAC, and those

Robert Lee

back out be G&A may you the that, to in related SPAC numbers. maybe guess I your Then Okay.

back G&A, as of up. with in You take simply constants still should that of space. saw are look this people home traveling kind new back And get again But open of maybe to starting the filing where into how opening things coming the headquarters up? you we or kind sequential for you think years your is in, IT and up step

Mario Giannini

Yes, so that. let me stick with

that So, incurring ago. quarters two the rent we expense, started

– So run that's I actually that not been And return our rate. think but in that'll building. on we're

things like area come go expect charges to and expenses. into start some There we of to building, that as So common are back the office expense up. we

back And it it's so, comes mark, the back. comes – it would when depends question how and how back all a Did expect travel and travel that. it strongly you really right, on comes

rent So, big base been that into the for while, our seen. But expense for now that G&A. be we had a little remains the to talking about baked that's

Robert Lee

fiscal So, this year? a run as of into we head good the rate think is to next now

Mario Giannini

rate. And about and run say would office that a it's come they travel top decent on we to I have as Yes, in. expenses of think

Robert Lee

my Thanks great. for Okay, questions. taking

Operator

line Kotowski from with of Oppenheimer. Our question Chris next comes the

Chris Kotowski

general, wondering what Hamilton I should right. de-SPACed activity. to it couple years we should before fully be we from one your two is good Lane next about just coming was expect expect wondering, the SPACs still, Hamilton Yes, And view financing And All into SPAC your you existence? if of market over the and to receptive I Lane there transactions? in find pipe is guess in I'm the

Erik Hirsch

question. for Chris it’s the thanks Eric,

pretty sort a which say, be, a will the is be, view want line stated SPAC business we not of for reiterate a do we wonder. new and this to will We of would market one-hit I as clearly what suspect, I us. So, that lot have I

here are first making a really I SPAC. think particularly, focused that and on So, patients sure we really for our we're good first experience delivering good,

told So as story. that's a what We that a is. the we to fitting, do not in of that as seen sure the we where We're something want sensible race. our sort head make by is market

And unlikely second de-SPAC think, it's that I launch of would the so, go before first. we we kind a

to need that market prove to our which is believe is we think strategy, the working. I unique. we

novel remain believe I picky much they the more to who sophisticated we a that We question, that slightly trying SPACs. more are people. we those this transparency, think of investors to across relates alignment again, it market getting from think, market So, business want and in about see much be interest to we're what I as is that better in one with approach, will since better of institutionalize the

doing think institution we're from what going that's the SPAC and you you about telling appreciate look raising if think, people I at shareholders, the we this support I here. received that HLNE in

optimistic think, this to in ongoing – I player an market so, space. will we we well in will today we we and be future the that be be are And remain positioned

Chris Kotowski

Okay. that's Thank me. you. for it

Operator

comes of of from Our Adam next question UBS. the Beatty line

Adam Beatty

the SPAC, morning. information the is the thoughts income sorry. to a I you. best wanted to middle the slides. wanting around of statement. question the through income just will for you statement section that fair are the Good to a revenue the will as if could there But showed on minute I of transaction little slide impact. ancillary focus think Maybe Thank of how you. consummated, streams. you be just get the the sort in Thank of your gets on guidepost value some just on a appreciate amount When the us completed? think Yes, SPAC that another way to run that. Obviously, about that bit other about piece a around give the

Atul Varma

one. let it's that Atul, Adam, Sure, me take

owned recognized that is get when de-SPAC, are revenue. by the what'll essentially Lane the shares they warrant as So, happen Hamilton and we'd

easy, that'll de-SPACing per shares a so number up just make at $XX share, times the share And if or of $XX it'll be be make company to let's got a it you've it security of a will to is the be revenue. what income. in going And that then the other the happen in changes shown line as value change mark the price below will forward,

Adam Beatty

accounts Got And of, specialized interplay little comments appreciate makes organizational it. back bit. where a the funds That then I to the the focus is. I between Thank terms and in sense. circle your separate around you. wanted

and right about now. – information gave looking, market some you So funds that are in the

sense ahead, little a balance Looking outlook. sure longer-term the can shift next not the you. a us what Thank that bit maybe of maybe pipeline like? we should fundraising So broadly expect to give you looks year,

Erik Hirsch

Erick. Sure it’s Adam,

One, factors of think there. world. it’s to back sort of the kind two pandemic really I whole

in what turnover So, and travel large we do and comfort people's sort ability kind living of new world to due of to relationships their what's are diligence that. around

one, this see I number who that means strong exposures just class distributions, are think So we right now. as piece of unknowable clients of sort seeing drop. their and that number are two it that's Piece asset in with though, is that's sort

returned So as things of dropping. and numerator are getting is exposure causing their markets cash, liquidated it be in private that sort to

to want be people They like on allocation to allocated. So top don't targets. of their under I stay think

there clients see maintain I some think continue, their to the pressure, to of of to to will flows these And markets sort targets. so in elements on positive maintain mathematical you be continue that order extent pressure allocation the

Adam Beatty

I total Thank for it. Makes sense. appreciate you responding.

Operator

[Operator Instructions] question Cyprys a from Michael have Morgan of And Stanley. we the line of

Michael Cyprys

Hey, thanks question. taking the follow-up for

Just to circle on the evergreen back wanted product.

the at in a I of $X the think it was billion March NAV about end you said quarter.

for the how can the incentive and we to economics any the are from going of maybe the bit P&L end Just that itself the And expect strategy come how around to could little and if of the was quarter. come curious through fees, the a particularly elaborate, just the through, product on remind and it then you that this us recognition timing? there where at December

Erik Hirsch

Sure Mike, it’s Erick.

serves and So prior have quarter been sort $X dollars. at so correct, a would today I $XXX,XXX, me think now of memory we're about if

it's in sort The has like it funds we the and a fund, specialized specialized It's where going we. economics on are terms bucket. the sitting is to this, difference and So look of are component. And where that that's doesn't of in of it's do this European a behave carrying carry handle component deal. to a because only follow a this by end carry way is that waterfall, deal fund a really closed the that not situation like given to really on evergreen is it kind

in has sort lot product of And generally fee Otherwise, offerings. it. that vertical. in And line element with same that of management our so a sitting again, the it to it's is stream

Michael Cyprys

something does that event? Just it realization quarterly to underlying pir have assets does that? happen require crystallization fee, like to clarify kind the annually Or the to of sold, be performance or or

Erik Hirsch

successful not of It it's it's of No, Eric the sale mark a sort is not of based sale highwater of again, sort a asset, or on of – the actual sort concept. it's asset.

Michael Cyprys

much. you Great. Got Thank it. very

Operator

over or to turn I'm time, no any would this like at remarks. additional management back showing questions. for further And I to closing the floor

Mario Giannini

thank we your Lane and to team, your Great. participation On Hamilton the everybody of want behalf for time.

the And yourself you of those support. in in weekend. enjoy Day for thanks U.S. For Memorial the again,

Operator

Thank This conclude you, ladies today's does and gentlemen. conference call.

You may disconnect. now

Hamilton Lane (HLNE) 27 May 212021 Q4 Earnings call transcript