SEI Investments (SEIC) 30 Jan 192018 Q4 Earnings call transcript

Company Profile

Participants

Alfred West	Chairman & CEO
Dennis McGonigle	CFO & Executive VP
Stephen Meyer	EVP & Head, Investment Manager Services
Paul Klauder	Senior VP & MD, Institutional Group
Kathy Heilig	CAO & Controller
Wayne Withrow	EVP & Head, Independent Advisor Solutions
Christopher Shutler	William Blair & Company
Robert Lee	KBW
Glenn Greene	Oppenheimer & Co.
Sam Hoffman	BlueCrest Capital Management
Christopher Donat	Sandler O'Neill + Partners

Call transcript

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Operator

Ladies and gentlemen, thank you for standing by. Welcome to the SEI Fourth Quarter 2018 Earnings Call. [Operator Instructions].

As a reminder, the conference is being recorded. I'll now turn the conference over to our host, Chairman and CEO, Mr. West. Al sir. ahead, go Please

Alfred West

everyone. Welcome

you and All of well Heilig, the as to fourth are Controller. then XXXX. turn it segment Dennis McGonigle, leaders over quarter the as recapping Dennis Kathy Heilig their segment start on some business comment leaders with year SEI's After to on of I'll I'll call the will segments. each that, the new LSV in by and of our Then will Kathy finally, of full CFO; SEI's provide cover results statistics. companywide investment segment. and the important business

As questions field at report. of each usual, we the will end

ago. start quarter $X.XX share XXXX. for Diluted year with me $X.XX quarter fourth the XXXX. fourth let quarter earnings and a the X% Fourth by quarter from of X% decrease full fourth of year earnings So decreased represents reported per the a the for from

of Diluted XX% year the the is XXXX, a reported XX% increase increased share by year $X.XX full XXXX. in per For the $X.XX earnings XXXX of earnings earnings. over our over for

by X% the a our asset reported increase by quarter billion. $XX.X balances -- me, billion. the billion the management grew X% excuse $XX.X revenue decreased Also and in XXXX XXXX, fell to $XX.X also We fourth fourth quarter LSV's XXXX, year. full by decreased for fourth a from quarter during of decrease under noncash assets SEI assets and

the For management under by year, assets billion. decreased $XX.X

million translates we price $XXX of $XX.XX of stock average SEI's quarter over addition, of the repurchases In during shares during That share. at fourth repurchased quarter. stock approximately million XXXX, X.X the per an to

of I'm over million approximately repurchased average at we of representing just $XXX year, entire share and an $X.X sorry, repurchases. -- $XX.XX shares million the For price

cash and we that. to approximately shareholders. in during buybacks XXXX, about Between our returned $XXX stock million dividends capital Sorry

capitalized million are development. we of recurring is amortized fourth events, sales $XX.X Fourth million generate previously net capitalized totaled to of net and quarter development client approximately approximately and SEI $XX.X million expected Wealth $X.X the annualized Platform approximately of XXXX $XX.X quarter, losses, million. During of the revenues approximately

full net note expected revenues the $XX line year recurring $XX sales of net generate ended million. are was negative to million but approximately is of client and annualized The a For approximately losses XXXX XXXX, extreme on that quarter. good year events a bottom These about to highly markets the due XXXX systems. we affecting Also as yet you, have the know clients to business is operating in fourth through are still on continuing communicated are us volatile we these loss our volatility January. enter totaled and

all reaction course. to the Our strategic maintain to our is volatility

deal corporate -- compression there's We have benefit a with of headwinds client well plans. to as in as U.S.

are take to the worldwide, plus of there On need side widespread the on the tailwinds institutions and the other advantage replace the coins other of the -- growth mainly of family legacy of we intensification coin, need of, to financial of side systems. financial regulations offices

profits in time, help the needs both are will the distributors of new that while manufacturers November also doing discussed we manage the of reorganization in recognizes we executing what As to XXXX, emphasizing converging, are achieve goals. organization markets. our long-term we us particularly and large The the end and long-term entered strategy. we that can same expenses At we believe our We growth. we're announced

is have why IMS organization of X platforms, using we We our X a client. collaboration banking together. That serve to number of level the high of a case put properly the single to have and studies necessitating of

We new Now better organization. we our believe of suited it's while road full the the be challenging, after and new in ahead also XXXX with opportunities. opportunities is strategies will new

new in I'll update an now concludes to so the Dennis? remarks the on segments. this ask Dennis you investment it give over then segment. my LSV business business other turn to I'll Now and

Dennis McGonigle

the Good Al. investments in for year full discuss and new the Management. afternoon, business of results cover fourth the quarter everyone. Asset results I'll LSV Thanks, segment and

of segment quarter digital investments continued segment the fourth principally Wealth the on Management on our ultra-high-net-worth our new focus business in its and the through private XXXX, advice During investors group. offering

the new fourth quarter, to the quarter $X.X During XXXX. of segment investments loss incurred during which loss a million, the of of a compared in $X.X million

to For a $XX.X investments offset by This the investment. business of of segment growth XXXX loss of other million $XX.X incurred in the new the million. loss improvement private Management year, areas full reflects a of business, for our Wealth compared

our during compares contributed LSV This to the Regarding from $XX.X of represent LSV LSV, in our contribution ownership interest quarter. income million the during quarter in to quarter. a fourth $XX.X million approximate XX% during fourth income XXXX. of earnings the fourth SEI

full the income million XXXX. in million LSV For to $XXX.X year contributed $XXX.X XXXX, in compared

cash million, were the $XXX approximately market mentioned, and the Al experienced offset was flow As million positive fell $XX.X of minimal. assets billion quarter which at LSV quarter during net approximately at fees declines. performance by Revenue during LSV. $XXX.X LSV the approximately was

primarily our rate couple in of the note $X.X corporate of severance quarter during the recorded for reflected tax the items effective company, approximately for company, quarter, expense the of For A overhead. million. This was we XX.X%. is

reflected of that, questions. in any result. will compensation true-up a $X.X expense investments I million, With of the take now management segment had also primarily We approximately incentive

Operator

And of we a Instructions]. Blair. [Operator Chris William from question Shutler have line with the

Christopher Shutler

expense, call severance. sounds it was So like there bit else of million little also some a corporate in quarter-over-quarter. that jumps was that It $X.X there or Was to the out? on anything

Alfred West

the also. there the in of of was two major million $X.X There onetime-ish. kind more were the Yes,

Christopher Shutler

$X.X could again, you was? that state million Dennis, what And Okay.

Dennis McGonigle

payments there for segment. a is incentive manager true-up strong this That -- was a performance year. services Even that's compensation on

Christopher Shutler

of to? that The is was individual, related is that target number Okay. one related people severance, to or that a any

Dennis McGonigle

us I don't of course our during they the employees, know, the quarter. left

Christopher Shutler

And XXXX? how in from about here, Okay. then rate rate we the think tax should tax

Dennis McGonigle

operating under still the are we the XX% that rate. tax is news good the corporate Well

to a the still be year, one one that's we're we range. Certainly that's So point. that XX% range, go -- this say that benefit accounting the the activity. other option good in starting have way going I'd could or

definitely we're XX% say little a bit higher. I'd not So if

Operator

Instructions]. we one time. no at this [Operator up And queuing have

So please continue.

Alfred West

Thank you, Dennis.

We are things going to based over the up turn organization discuss a both Steve? Steve it on change I'm to banking Meyer IMF to now to bit new segments. going private and

Stephen Meyer

Thank you, Al.

the After begin, QX on Investment to I take questions that. IMF. discuss outline just questions I and Before take will my review will first Manager's approach. questions QX, on banking I then segment's those private

So for private banking.

Fourth compared from ago to decline quarter due transaction-based by primarily revenues transaction-based $X.X is of million, quarter a revenue XXXX, fourth revenue $XXX.X mainly the revenue. of to the quarter down million as our third asset year management up increase XXXX, in slightly revenues. was For of in driven an

operating quarter profit increased was $X.X to fourth the the and quarter from due million third increased transactional For XXXX, expenses. decreased revenue

by SWP in For $X profits management onetime million, mainly QX to driven And the million $X.X gross events. quarter, events new our and asset and profit-recurring decent the was grew by sales turning $X.X relationships. quarter. for closed sales million in activity our year, we business a

As to larger book one we global working accounts. large is we to clients add are third on mentioned of quarter our U.K. of private our call, our

platform part term. expect our we this in book through the deconvert During the of to near all process, turn

we Although growth against If expect the appropriate new be our expected occur is existing enough believe for us. we of to this it's business the the successful, impact deconversion a timing ambiguous, have QX event. we from client certainty the significant net that will potential that will opportunity

during and existing security XXXX Trust Company, extended relationship During agreement, other SWP clients fourth with the the in quarter, we our a SEI. new the Wealth X until fourth Also the U.K. Trust with signed Fusion is quarter, a X XXXX. to new and we client

to meaningful with we business opportunity expect Schroders banking this Given strategic be for Lloyd's their affiliation group, and SEI.

during $XX.X recontracted a quarter, Regarding clients two the XXXX, total for Trust million. we of

clients we've of recontacted $XX.X XXXX, for revenue. XXXX XX For million Trust annualized

cash business quarter. distribution experienced in the in $XXX million management asset approximately negative Our flows

During to the exclusive goal-based will portfolio wealth clients strategic solution will group, their business signed quarter, Asia. high-network several firm, financial large BMO goals-based that SEI's investing. use management offer deals as to Innovea, approach new their SEI's including France who AMP a And in our

update total This SEI the to SWP. platform an currently on processing As client a during the U.S. the clients Platform quarter. converted the XX wealth backlog, on to brings we Wealth

net Our total for is $XX.X in SWP million Also approximately backlog revenue. recurring to not new installed signed but Fargo. Wells on update

we're continues All closely Wells this and project. conversion working activity our with of in

we final the implementation Wells, continue milestones While deliverables and await is all met. to scheduled from be

XXXX, the focus our to are to We is first end quarter. And know growth. on of hopeful turning more the about

federal short from navigate losses some we SEI. announced A profit this pipeline announced is both current by new our solutions will These the new the move available opportunities previously of market revenue sales leveraging significant in so put headwinds strong, and Unfortunately, with solutions as off the of Our focus one doing our generating revenue of business opportunities to will QX and and term. expanding at by client to current pressure closing is quarter. Interior end conversions. contract the have now XXXX, expected the and we while on on as platforms and downward the additional of events is at in Department growth we well the

profitability. segment We and sell positioning to focused business, while expenses diligently we clients, will new manage will and the grow continue the manage business, we and through we sustainable these headwinds, implement accelerating on for

I'm profitability, our leading recognizing segment, to about mutually While business the long-term optimistic opportunity short-term platforms. challenges markets available to our this and growth

for business. and I'll it We and over increasing have. sales work new remarks, any continue my That our to implementing build you questions may now on and turn prepared pipeline concludes

Operator

Instructions]. [Operator

O'Neill. Chris Sandler to Donat go will We with

Christopher Donat

that Department we there know we With associated we cost any Interior expect also restructuring that to would the any revenue's with in should quarters? or future of weighted. expenses be still shrink, contract, so Are about the thinking that,

Stephen Meyer

one of we some reallocate unit, business the say are what be really there won't more release matched of revenue. expenses the the within profitable I'd was that expense and any takedown pieces is, Well, with of it while our of will

would although, new I And to on a business also some see to diligently of match-up think coming on. are we managing are expense, side. of to of going use So it we expect that support kind I kind that

Christopher Donat

All we I'm on to expect quarter. to expect the said news of put call? flow, end just Okay. to... of a by trying something the expect in clarity the then release? about what just Fargo, earnings with quarter right. hear out terms more you Or you would that can Wells terms expect should press first Is in And we of

Stephen Meyer

the you'll probably until suggest first not would quarter that I call. earnings hear

Operator

question And with William a we have from Blair. Chris Shutler

Christopher Shutler

how business. the in or up much step of a there was little step a then just So market there revenue? in bit? in professional services impact. us revenue up for quarter-over-quarter much break step it there Can was of of transactional quarter-over-quarter you was a a Obviously, down the how up negative revenue, Like onetimes and and

Stephen Meyer

we in quarter. up I quarter. revenue Well, up down in -- both of was QX QX revenue fees, between over They're believe It the certainly booked were million. servicing did last this which step transactional our and from about that mutual was brokerage our $X.X was have QX. And fund actually We revenue. majority actually million onetime $X.X about

Christopher Shutler

And compare does that quarters? million, to $X.X how that prior

Stephen Meyer

think we're Well don't kind or depending I what we've I had. the exact don't consistent think, It's down up flow. a a think little with it's I in on quarters. kind But it's of standard somewhat previous of signings -- a seeing bit there's

Christopher Shutler

comments then again. And the through go you your on can just reiterate, really Okay. sales to quickly

you of half reiterate and growth that was of million that Can again? onetime. $X.X said You

Stephen Meyer

Yes, gross been And QX. million, was of million in in events that, million $X.X quarter. so in about sold the it $X.X has onetime recognized and the million $X.X in $X.X

Operator

Lee question a have from We with KBW. Robert

Robert Lee

and to related -- the customers seen over Just potential kind someone think it paying or of is XX trying curious, fees platform a out commitment conversion earned of enough you have so hires net that platform. you fees who a to XX you paid if of sense to you over some us kind of a fee, we Or back haven't is potential full the of Do just onetime couple to new of get SWP. get fees the are flow upfront you guys -- full when it's to you have still through tracker the of who exploring go years potential there look and the implementation and who a you time XXX% client them those pay may if fees, you Is there fee? time kind of give a business? made wants haven't over its this past

Dennis McGonigle

pay I'll probably instance just because that significant over think up a off five years the had a fees ago. is and frankly, -- didn't new past one a only contract, where let had I signing Steve guess, he wind client we we implementation or I really to, any

us one. client every So has is converted except a contract paying to

Robert Lee

that the gotten pipeline? And they yet of up are a little there still expect out bit sign kind there to you you -- paid maybe going have there some fee, just they're so but and haven't of a there's

Dennis McGonigle

I a is the think as fee they are paying sign contract. inclination an us they

Operator

Greene question And Glenn from with we have a Oppenheimer.

Glenn Greene

and do sales could move not goal the So pipeline the I and over of these big sort private the And sort how get just along sort question, Investment banking running view want some sales you what or of get moving? get fields sense picture changed to to think in be pipeline you of can with line of a the really what you Managers. the

Stephen Meyer

are room in now. on Well the Glenn, all me eyes

probably listen, say is have So to strategic do, But what any for is little I broad in a its -- two opportunity. of you my we early a so I'd lot its discussion. assessment is months

have some and reorganization have both I'm use We pipeline for sales of long as that are deals U.S. work strong reasons to phrase the leverage have agendas. moving people that Not opportunity heard other to on But here same really the help the client look solutions a process we have with people agendas, do hard the a SEI are across there's platform you as us U.K. of this shorter-term hard. and where a to is of think very did but the I the while working well these lot platform the an we and offering work opportunity think and and who think us that, maybe the base we I expand we longer-term along. one for might we great there's walking I one. is in

through and very We I pipeline the have this a strong them it's at a just point. think pipeline matter moving

Glenn Greene

more you're or about, product, maybe in on be anything that thinking the sales distribution in pricing it's there of or you're may terms Is specifically, whether rethinking? the modular tactically going side more something that of terms

Stephen Meyer

right growth to say, from But of how Glenn, to color #X we go I'll you along. how pricing and I'd now, more everything platforms we as safe on it and my growth top for and What focus say I'd and growth have is is at speed everything And the and line. other can across bottom looking we considering I'm on do we this platform to our position. solutions up line

Operator

Instructions]. [Operator

to with go Lincoln will Sam Hoffman We Square.

Sam Hoffman

you color to give sell Steve, developing to of then private can what you're bit the on, Investment in terms through do question more And on Managers products clients? working platforms you up a follow quarter. the previous or be banking on just to specifically, cross the $XXX next are $XXX accomplish rate for the needs of have to million expense what you year enough X? your within kind Currently you're per the looking of budget? that million going of run over to Is

Stephen Meyer

thanks. Great, Okay.

of leveraging When limited the So we're this we solutions, made we maybe which One, platforms what not large is used looking we maybe of client we Cornerstone, to as IMS primarily X two the using just have. a of signed IMS. example but absolutely RA, recently first is some which in far as the a questions. announcement,

with banks want are many the you to banking, also of deal more to large If we look granularly manufacturers.

the manufacturing the locate already banking. of solutions have we client, we we've them and IMS well Fargo, platforms who is either Or as of and support as client opportunity businesses. built, many a So Wells to as a have their such are as

I the can expand on really that. have how main initially looking that's of we So focus kind

say year, to are what going would we I is have managing this to we're budget into As far manage as expenses. the

will the I more absolutely we So what have for we to be tightly. do, are feel expenses have looking we enough to accomplish at them pretty manage than us and

Sam Hoffman

Okay.

that offset you going growth? money to to you're any for So make of merging products expenses some that saving will and organizations be the need develop to on

Stephen Meyer

I on we not amount it -- exactly sure I'm are -- implementing I a amount spending way and are but spending classify clients. decent Not think, would that and sure development we say,

do think more bit able might us ways to saving I in be can may result we things there's be that some money. little efficient

Operator

And we Blair. will go William Shutler with Chris to back

Christopher Shutler

get in just SWP? we cash to going the net the Can for flow U.K.

Stephen Meyer

I flow total don't know the have U.K. for we the to Net negative, we net U.K. I if I handy are know us.

and We I'll come get will to try call, you. to the end the through of back that

Christopher Shutler

on in just for How handful any do Okay. quarters? next the update, Steve, you attrition you have XXXX outlook -- And quarter. of didn't Trust feel I any the the then about know

Stephen Meyer

We've good. we just look X% clients average concession in feel at XXXX. of had the in a more average X% on we the you recontracting, our with had year QX if concession, crease I good and shy for importantly, pretty year recontracting did

So SWP. we main them is ready goal are to convert to SWP are in new and of not active, recontract with to advance ones the them we that for are or engaged obviously, our

we have are market some look conversation business. feel we the that's we clients competitive in pretty and we but certainly nature the So of confident, honest, obviously will that the

Operator

we have additional no And questions.

continue. please So

Stephen Meyer

$XXX,XXX Chris, follow U.K. Sure to and in flows just were up, the the positive.

Managers. Investment with turning that, So to

fourth net For was due as $X.X million quarter expansion. our XXXX. quarter for or existing segment higher which year-over-year the and of $XXX.X the compared client fundings million, of This XXXX, revenue primarily X.X% was revenue fourth new totaled to in revenues to the increase client

$XX.X of than was or XXXX, our which year year higher the revenue full $XXX.X million the was XXXX. XX.X% For million, full

was for million $XX.X X.X% to XXXX. as quarter fourth compared of million segment the the quarterly or Our higher profit $X.X of

higher million of was $XXX.X XXXX. approximately the for Our full year or of $XX.X XX.X% profit profit annual segment than the million

flat to XXXX end the quarter of at the as essentially, the end the compared fourth third asset Third-party XXXX. of of asset were $XXX.X quarter of balances at billion, the balances

billion assets million quarter, billion, depreciation assets totaling quarter against fundings these segment; our $XX.X $XX.X wallet had and Most manager sales included existing a XXXX, continued we highlights: the the the business outsource were time, turning $XX.X market managers; current multiple as increase revenues. multiple business market wins new with new to our Although after of of recurring business traditional strong both and lines new a spanned new we $XX quarter-over-quarter, flat start-up in following net to million to recurring and with very for mandate, were family an alternative including in an net decided first have business all and cross-sales of events diverse Events expansion sales as And new-name several at share alternative collective These included $XX.X in clients. with with market did solution of clients. client due in clients. along importantly, during events solutions several of fourth new expanding middle the expansion growth activity, footprint X net in unit across office billion. Trust office Mangan the revenues service entire of well existing market product X with recontracts

events XXXX acceptance $XX year-to-date. validate total events were our business market over strength net our and solutions. for and million just Our than feel a approximately sales We And and to which sales of this the in $XX our strategy continues XXXX. higher record largest total million, was

platform opportunity; and clients continued platforms of compliance; our will platform origatory our three, in leveraging including segments. other expansion global sales solutions continued and and into supporting As growth opportunities on: investors; and our support we expansion to one, four, growth and analytics of of continued our our office the two, execution entered our solutions be front XXXX, market data emerging focus

diligently. our managing in growth invest to solutions expenses continue while our and will platforms support overall key momentum, also We to

on efficiency grow. We driving are we as focused sound

continued opportunities. strong it over Our prepared and That remarks you pipeline of I'm have. remains the I optimistic any concludes questions my and growth for turn will may

Operator

[Operator Instructions].

Robert Lee go will to We with KBW.

Robert Lee

that just miss of I you mentioned? could repeat kind quarter net business in new you I the it. just think some maybe Steve, of the

Dennis McGonigle

was quarter million Sure. in the $XX.X Net recurring new in business revenues.

we million. clients existing of contracts $XX.X So

Robert Lee

the kind are clients about kind kind the not just Okay, back that talk have be I the clearly the their as pricing, the are -- be to a you business, of great. may you some you what front. banks seeing you of recontracting, about it's But competitive us thank a of of clearly yourself how generating just on And I environment? custody may and mean talked environment? clearly of in kind of sense they're you their struggle clients lot revenue a are positioning but about then little getting some can large Can there mean from how push you God. of may custody it? of you're sales. new And talk from give reacting not for be keeping the But

Stephen Meyer

mean market. have with there a out There's say not and typically Yes, compete price. the prospects you there. That's on when we it's don't other of clientss us get I into lot competitive well, competitors competitive to don't certainly that We out to bid. and come that

We are low-cost typically not the provider.

think model. that We Quite said usually fee now And premium. working I including justified to way us, an with rethink it's from that's to I and the managers, view and before that's the platform do that's highest rebuild. their I've require solutions coming their but business this as the managers requiring not still down Because frankly, opportunity. we the partners its with compression are

our to share and are there's for around opportunity of think then and around their I expand support plenty that opportunity different middle As office, they these of less more they're add platform now support business, silver Certainly, have it way view And for as it doing to office add and firm. office, the of client. to at their other groups their front of at I areas to their to provides wallet trading, whether would of doing solutions and us. us the relook there rescale our middle groups adds have to it are inside business, lining they they're look

Operator

Instructions]. [Operator

with We William will to back Shutler Blair. Chris go

Christopher Shutler

at then backlog time And numbers. Steve, the just get the line?

Stephen Meyer

of that XX I'd right -- $XX.X to is Backlog XX And the months. about now. within the expect Sure. XX fund majority to say next million

Operator

Instructions]. [Operator

We up. have no one queuing

So please continue.

Alfred West

you, Steve. Thank

segment is this Withrow will advisors. Our cover Wayne next Investment segment. Wayne?

Wayne Withrow

two XXXX segment quarter. fourth a cities, good the turned Thanks, of was down Al. tale with the year market until the growth really IWA during in achieving the

quarter, the year. despite the we still achieved and of record challenges However, for the revenues fourth profits

are SEI migration on we Platform. to of importantly, completion in the Wealth our closing More

For the quarter cash were The revenues, in These last net slightly were over more of than flow totaled revenues negative million. revenues fourth our quarter. the quarter of year. $XX was offset year's from versus by only impact quarter down last positive in fourth fourth down Expenses capital markets. the

were third as slightly As expense to sales variable the decline by categories increases compared were quarter, only expenses competition. up in some in offset

quarter, profits market declines. to fourth were capital in million quarter, the but down year's primarily flat due Our $X were third compared last to

at December $XX.X of cash XX, XX, XXXX. were billion flow. offset positive management December markets, net billion decrease was driven by from partially under by The a Assets decrease capital $X negative only

$XXX the positive experience in SEI for in we market is year, investor million quarter did cash flow behaviors. net cash net the fourth the While impacted negative flow volatility

also a from riskier during cash to quarter. the shift assets We saw

recruited total advisers to new our quarter, the bringing the XXX. During we year XX for

Our remains of advisers pipeline active. new

the of and end main completion of XX% on over have we first we XXXX, X,XXX now We quarter. in should will of the all the platform assets. by in $XXNorth over onto clients our firms migrated XX are have In of the and of Wealth three the platform our million SEI Platform. areas: first, wallout we XXXX, concentrate focused converted For the on

to we adapt SEI the completed we with relationship of the migration, them. be capabilities more on of and them all technical advisers will Second, our on capitalize strengthening allowing focusing as Platform, Wealth functionality having its

from focus shift questions forward due our quarter our of but welcome pure and the solid continue back I may we influenced a Platform. of summary, on negatively of look Wealth fourth completion positive re-examine in volatility and In strategy us. as our front force by growth. of will away have. migration the we the we was Third, to go-to-market long-term the confident SEI you opportunity to sales our to the XXXX market in migration progress remain any note, in We migration to

Operator

[Operator to go Sandler Instructions]. O'Neill. Chris Donat with We'll

Christopher Donat

the I down does basis that take it and point -- you cash was so. risky to like just a talked as we calculate the rate your wondering or assets about with it ticked movement from fee look

Just wondering cash seen of as January? more having for if XXXX the cash market of back you've in kind conditions you first into implications have quarter revert about expect any our improved end investors the

Wayne Withrow

basically, volatility the actually little hangover from investors was out have fourth still will to more probably its a riskier think people I bit the move what predict a the return, to second while I the and -- in first But balances of and good I happen. say can't class. quarter, news say asset earlier most quarter, higher whatever, liquidity eventually quarter classes would asset the is the the that fee will hopefully,

Christopher Donat

But quarters, pressure if -- we in little but in your little on for a might coming I'm have people do recognize. sitting I you see might a mouth, while? cash a words see we Okay, putting in fees

Wayne Withrow

on It guess say to depends is. hard I of what really. it's kind the mix

Operator

Lee Robert from with question a have KBW. We

Robert Lee

in Just a one questions this. point where on guess with I X be will SWP. getting closer to

going First, legacy the kind realize or the revenue, sense that you therefore, early platform and some something of kind then uptick of your increased decommissioning to from some and savings of platform? you're trying little of increased a and kind in platform I growth longer of you to no kind you're to But of advisors you use being from of any see of Starting are of kind putting. fees be at of towards kind sources shift have that functionality? any channel least may guess the functionality see kind or that back ancillary the a suggested bit to there bear? the given but of completely days, to it's start

Wayne Withrow

questions. Yes, Rob really well, two

continually shifted expenses is we whether that as in make. we associated with migration or choose reinvest we to some we the platform, the try to will how we we redeploy as I the think growth a of that platform, think I not to lose decision save that area

shifted no call of cross-selling process, for getting I would migration from out handholding more non-SEI on sales think force going can better assets terms we we the that, what In the asset I away assets. and other and helping basically as classes focus the through and growth SEI clients

Operator

[Operator Instructions].

additional no have We questions.

So please continue.

Alfred West

Wayne. you, Thank

segment. is on next Investors this segment. the segment Klauder Our Paul will report Institutional

Paul Klauder

well afternoon, the a XXXX fourth basis. $XXX million to $XX million fourth performance-related to quarter were and to items of of increased of XXXX XXXX I'm the impacted but profits the $XXX X% previously compared revenue of the client profits XXXX $X the due quarter totaled positively expenses. Fourth were lower lower full operating in quarter this million Good markets the by net to and event X% operating million, were fourth as entire revenues year XXXX million. expenses XX%. revenues of the asset margins Market contributed Full the were increase. $X.XX a X% Net quarter for than $XXX.X X% of year billion, XXXX. offset $XX million fee everyone. capital full a Al. appreciation lower Operating mentioned quarter the client of inclusion XXXX sales losses were quarter on than slightly XXXX. negative results to higher compared fundings, lower of million. the year. XXXX. Growth due for lower and year markets for fourth Operating Thanks, Net were and financial discuss of was good fundings XXXX of revenues. as increased year-over-year to onetime capital client $X.X This

passive to by U.S. represents and of multiple revenue. market XXXX year-end corporate including fourth corporate and decided reflected was asset into at quarter hospitals. for that [indiscernible] the of The a due across This containments offer client and continued DB Quarter-end quarter got was number unfunded investors fourth $XX.X a implementation. Fiduciary Management U.S. driven client performance. Total the New XXXX. The decrease foundations, merged organization, billion signings of were new quarter's larger $XX.X billion, U.S. client relationship capital primarily complete to $XXX billion, is management $X.X a that $XX.X backlog versus million. that balances was negative a client-loss markets for million U.K.

to foundations, new management, and global adamason continue entering reunions, out treasury diversify business non-U.S. healthcare, government contribution to defined in [ph] of into focus new U.S. growth Our will the XXXX and DB defined-benefit be market markets.

very for I'm believe volatility answer have. be market catalyst to to reconsider Institutional may questions you a to you much, continue that management Investors Thank process. happy their will positive any that investment and We

Operator

Instructions]. [Operator

We with will Robert back Lee go to KBW.

Robert Lee

of Just I And Segments segment? some kind mean while so makes given of of mean steady or make? fees or been the now. did take how anything in some give to quarter-over-quarter we shifting in that -- going around the a Is it's XX% or of that on most infrastructure, sustainable? there that of how you sustainable, have for you distribution should think top pretty have profitability investments existing new terms you of curious. think forward? with I you recently, should How of see new about kind view challenges. maintaining kind biopsy, kind the not speak, coupled be the And of business net that. to kind I pressure Certainly

Paul Klauder

we all business. EMEA Well, Asia the have or and the that's our description, investment we U.S. whether in in or infrastructure think made

are there. So we good we think

Your dead of we in little off than really little we profitable but actually yield and might that switch fact are the is higher in investments people is phenomena this assets a and what because bit growing, to might on we foundations a have consumption what saw endowments. a are did on and point Those and rolls markets. that the much we that on public much bit higher alternative more the their in plans, year fact investments roll donating that endowments than defined-benefit do well foundations be

will get right that high-XX% again, business. on profit So as the to can't say make that will pressure into a profit downward and margin if some think make we a can decisions have see we here XX% those accretive to going so bit XX.X% be business, margin confident the I fourth I always I and position markets, we're little a this we'll just some that am strategically go the business split a sit we business while low, in the we down and investments quarter. below And to realities. saw

Operator

have we And no Instructions]. [Operator questions.

So please continue.

Alfred West

to statistics. Kathy? like you to a have companywide few Kathy now give Heilig I'd you. Thank

Kathy Heilig

I have additional some Good quarter. afternoon, Thanks, Al. corporate information regarding everyone. this

flow year-to-date million expansion. fourth capital had quarter we billion per cash $X.X was share. quarter $X.X the or from $XXX.X software capitalized $X.XX per to operations fourth flows to cash for cash XXXX operations million flow $XXX.X bringing $X.XX free of In Our million. Fourth did $XXX.X $XXX.X expenditures, from million excluding million, flow quarter that share. free or facility cash include of Year-to-date

include was already $XX tax software million, capitalized year-to-date our expansion. to facility. we to were and XX.X% $XX.X that $XX the included XX.X%. rate be the million expenditures capital capital for $X.X related million, We expect was which In tax would which rate excluding about quarter the Our annual million facility approximately XXXX, for mentioned expenditures

also and We expect, this presented continue, and upon forward-looking comments are remind can to unaudited. identify will, is that you and may, many financial that cases, believe, release statements statements as information assumptions involve are terminology in by like are you risks of would or call based on appear. In our some information such that forward-looking

business forward-looking believe to and expectations that capitalize by timing occurred that of the timing on our events, revenue ability new include quarter, statements the our be to scope generated these the and opportunities sales we the Our of events will during events. conversion as

call. and will on to the execute the for market and conditions our markets objectives articulated on strength the our market and grow ability us for Our business of us. create opportunities which strategies our existing this opportunity of to business, strategic degree of create pipeline for and our the the that success XXXX Those execution to conditions

they and to based on forward-looking change. expectations beliefs subject and as of undue not statements subject beyond risks management which control should of significant our to You or on and place many uncertainties, are are our our reliance current

Although, we inaccurate. believe they these functions statements upon be which reasonable, are our we base could forward-looking

the risks can December feel for in report those section the please questions and factors ended cause results important Commission. risk annual XX-K could year forward-looking actual Form free on that Securities any And XX, XXXX, have. factors to you of Exchange to our other with differ that may described our that ask now, the and was filed found be are of statements from in Some

Operator

Instructions]. [Operator

Lincoln We question have Hoffman a of Square. Sam line with the from

Sam Hoffman

this what XXXX? is challenging in areas cost for growth probably My your invest going for main objectives be rate is, terms areas control? to growth to the are and year, you're in, that other of budget to revenue need where going focused the be question expense whether you and Given on expense that feel you

Dennis McGonigle

we're probably you in thrilled happy not prior that echo Sam, his I to listening to what about, segments. from all standpoint. predicting about the would this say, And calls, Steve is an -- know from Dennis. future expense just particularly talked

'XX as are words, a Steve's to manage at We tight I'll expenses. diligently. year really use looking

it. So that's when expect can you

to about I of think are two indication going items, take was kind managing those third unusual you which kind an you of out of with tightness how saw if the it and we pretty fourth we're that we're expenses. --

strategically. in invest market So to are the opportunities the to that certainly our to made we we're the believe going areas And clients. continue the what commitments in we've to meet fulfill

business those So make organizations, priorities. with I will running there's sure technology expenditures that to continue, the units closely Lukes -- work clear

around help are going us that managing things priorities, future. else around just in the are pretty on absolute spending that company to everything that, And the only are We tightly,

Operator

We'll next Sandler Chris O'Neill. Donat with go to

Christopher Donat

that to guess 'XX? stock-based that to would lower or $XX.X little specifically, stock-based comp I twist of cause saw question are that going any I or comp in what bit. prior the are on that on higher takes I'm really there guiding factors just -- meaningfully Yes, line a the the puts you're that press to release be and million,

Dennis McGonigle

our the -- targets. an years, pretax and aftertax two driven to As prior it's earnings the that our us the target. hitting options in by Particularly know, past options of is you certain vesting that, earnings were granted

cost how we we will hit amortize of on what options based is those to associated our targets. think So the those estimates

the the to a we those had timing that variable that last had change fourth in we So you real variable in third, fourth options. that's will remember that bit only only expectation. if change quarter year, of little occur 'XX. real that a expensing But is quarter, relative And

Christopher Donat

you if accrue still then some just contract its wins thinking that things And salespeople the that. case Okay. compensation large compensation you'll see more had about like -- get you'd often broadly, for

trying see you Just what think might in compensation? to factors

Dennis McGonigle

contract, accounting of the And life and or that only remember -- you've terms the there, life over The that year as last expensed in life. in estimated place, getting rule in some of that that was that the the deferred. was you measured change of new that the relationship of

in see wouldn't you you XXXX. in that, as say, So would us have, like much XXXX,

Operator

the William Blair. And Chris a from with Shutler question line of

Christopher Shutler

break Let's quarter, you IMS. the recurring I segment? and from say, the were sales in think revenue said $X.X you by occurred million in that million advisors can institutional? million in events What private banks, down $X.X $XX.X that

Dennis McGonigle

cash flows negative. They were negative their because were

Christopher Shutler

right? The first were two numbers correct,

Dennis McGonigle

upside chance we And institutional, adviser I'd to away was good have in little then our terms a in were transition the And of including a of there us. going other one a they're and we from client flow. but -- negative opportunity that in conservative essentially flat Banking they by going the of say meantime X business is those they're to cash fact because that being transition. net that's in recurring -- number net lot

was number is kind the and total less of it make simple, the to flat. So IMS cash really adviser institutional flow, relatively banking kind of because

Operator

[Operator Instructions].

have questions We coming. no

continue. So please

Alfred West

call. good and thank making So taking encouraged volatility, are our benefit investments by us will the direction in place has that am we Have ladies times lines they each making. attending a taken the industry. changes our day, for believe and gentlemen, and the the difficult to are sight business all you of help these are the with that progress I our from I

Operator

gentlemen, And disconnect. Executive may now you. teleconference you for today. TeleConference service thank We and AT&T and Thank for our ladies concludes this you using

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