SEI Reports Fourth-Quarter 2024 Financial Results

, /PRNewswire/ -- SEI Investments Company (NASDAQ: SEIC) today announced financial results for the fourth quarter 2024. Relative to the fourth quarter 2023, EPS increased by 31%, and revenue and operating income grew by 15% and 43%, respectively, with operating margins increasing to 26%. Consolidated Overview (In thousands, except earnings per share) For the Three Months Ended December 31, For the Twelve Months Ended December 31, 2024 2023 % 2024 2023 % Revenues $557,190 $484,858 15 % $2,125,151 $1,919,793 11 % Operating income 145,544 101,684 43 % 551,741 424,524 30 % Operating margin 26 % 21 % 25 % 26 % 22 % 17 % Net income 155,771 120,731 29 % 581,191 462,258 26 % Diluted earnings per share $1.19 $0.91 31 % $4.41 $3.46 27 % "Our record 2024 results reflect consistent execution against our growth strategy, particularly the progress we have driven in the last 18 months. Our net sales events in 2024 increased 58% from 2023—representing a mix across our entire organization and reinforcing the high level of market engagement for our enterprise capabilities," said CEO Ryan Hicke. "We are focused on maximizing our return on invested capital across our segments and solutions globally. SEI has real momentum, and our employees' commitment to delivering for our clients and embracing an enterprise-first mindset has been core to igniting that momentum. We're excited for what's ahead in 2025 and to continue delivering long-term value for our stakeholders." Summary of Fourth-Quarter Results by Business Segment (In thousands) For the Three Months Ended December 31, For the Twelve Months Ended December 31, Private Banks: 2024 2023 % 2024 2023 % Revenues $140,142 $123,337 14 % $541,414 $496,317 9 % Expenses 120,414 110,656 9 % 460,375 448,490 3 % Operating Profit 19,728 12,681 56 % 81,039 47,827 69 % Operating Margin 14 % 10 % 15 % 10 % Investment Advisors: Revenues 139,267 109,719 27 % 509,408 436,298 17 % Expenses 76,839 67,138 14 % 282,902 259,142 9 % Operating Profit 62,428 42,581 47 % 226,506 177,156 28 % Operating Margin 45 % 39 % 44 % 41 % Institutional Investors: Revenues 70,812 69,794 1 % 285,723 289,708 (1) % Expenses 38,315 39,118 (2) % 154,701 165,455 (6) % Operating Profit 32,497 30,676 6 % 131,022 124,253 5 % Operating Margin 46 % 44 % 46 % 43 % Investment Managers: Revenues 191,262 168,571 13 % 728,390 645,254 13 % Expenses 118,130 110,713 7 % 453,085 419,196 8 % Operating Profit 73,132 57,858 26 % 275,305 226,058 22 % Operating Margin 38 % 34 % 38 % 35 % Investments in New Businesses: Revenues 15,707 13,437 17 % 60,216 52,216 15 % Expenses 19,296 17,826 8 % 74,699 70,745 6 % Operating Loss (3,589) (4,389) (18) % (14,483) (18,529) (22) % Totals: Revenues $557,190 $484,858 15 % $2,125,151 $1,919,793 11 % Expenses 372,994 345,451 8 % 1,425,762 1,363,028 5 % Corporate Overhead Expenses 38,652 37,723 2 % 147,648 132,241 12 % Income from Operations $145,544 $101,684 43 % $551,741 $424,524 30 % Fourth-Quarter Business Highlights: SEI achieved diluted EPS of $1.19, up 31% from the prior year, representing the second consecutive quarter where SEI has realized significant growth in net sales, revenue and earnings from the prior year. Q4 2024 diluted EPS matched Q3's near-record level despite the $0.02 impact of several items affecting comparability in the quarter, specifically: A $0.04 negative impact from higher incentive compensation accrued in Q4, in recognition of our employees' reigniting SEI's momentum and our strong financial performance in 2024. A $0.05 negative impact from the timing of stock-based compensation. Accelerating EPS growth caused an increasing number of equity awards to vest in Q4, driving the higher than normal non-cash expenditure. A $0.02 positive impact from FX transaction gains. A $0.05 positive tax impact from options exercised during the quarter as well as our year-end provision estimate. Net sales events during the fourth quarter 2024 were $38.2 million, bringing full-year 2024 net sales events to $127.9 million, a 58% increase vs. full-year 2023. Similar to last quarter, the drivers of net sales activity were broad-based, coming from multiple existing and new clients, both in the US and globally. Consolidated revenues and operating income increased by 15% and 43%, respectively, from Q4 2023, with revenue, operating profit and margins increasing for each business segment. Private Banks revenue growth of 14% was supported by recent sales events, increased client retention and the conversion of the existing client backlog into revenue, with operating profit growing 56% due to continued cost discipline. Investment Managers operating profit growth of 26% was driven by sales event growth and client cross-selling. Our Investment Managers offering continues to gain traction, most notably with private credit and global clients. Investment Advisors operating profit growth of 47% was largely driven by a $21.1 million contribution from the integrated cash program in the quarter. Modest Institutional Investors revenue and operating profit growth reflects improvement vs. the first half of 2024, with the business working to offset the negative impact of corporate defined benefit plan terminations. Absent the negative impact of incentive and stock compensation expenses noted above, SEI's consolidated operating margins improved relative to the prior year and the prior quarter. Average assets under administration increased by 3%, and average assets under management increased by 1%, relative to Q3 2024. However, ending assets under management declined by 3% vs. Q3 2024 due to a combination of market valuation and net outflows, most notably for LSV and Institutional Investors, which saw an unusually large impact of plan terminations. Relative to Q4 2023, both average assets under administration and assets under management realized healthy growth of 15% and 18%, respectively. Earnings from LSV decreased to $33.4 million in the fourth quarter 2024 as compared to $35.4 million in the fourth quarter 2023, due to slightly lower incentive fees. SEI repurchased 3.1 million shares of common stock for $259.5 million during the fourth quarter 2024 at an average price of $83.43 per share. Earnings Conference CallA conference call and presentation to review earnings is scheduled for 5 p.m. Eastern time on Jan. 29, 2025. Investors and the public may review the presentation and listen to the call and replay at seic.com/ir-events. About SEI®SEI (NASDAQ:SEIC) delivers technology and investment solutions that connect the financial services industry. With capabilities across investment processing, operations, and asset management, SEI works with corporations, financial institutions and professionals, and ultra-high-net-worth families to help drive growth, make confident decisions, and protect futures. As of Dec. 31, 2024, SEI manages, advises, or administers approximately $1.6 trillion in assets. For more information, visit seic.com. This release contains forward-looking statements within the meaning or the rules and regulations of the Securities and Exchange Commission. In some cases you can identify forward-looking statements by terminology, such as "may," "will," "expect," "believe" and "continue" or "appear." Our forward-looking statements include our current expectations as to: our focus on maximizing our return on invested capital across our segments and solutions globally; our ability to deliver long-term value for our stakeholders; and when and if we will generate net annualized recurring revenues from sales events that occurred during the quarter, as well as the amount of any such revenue. You should not place undue reliance on our forward-looking statements, as they are based on the current beliefs and expectations of our management and subject to significant risks and uncertainties, many of which are beyond our control or are subject to change. Although we believe the assumptions upon which we base our forward-looking statements are reasonable, they could be inaccurate. Some of the risks and important factors that could cause actual results to differ from those described in our forward-looking statements can be found in the "Risk Factors" section of our Annual Report on Form 10-K for the year ended Dec. 31, 2023, filed with the Securities and Exchange Commission. SEI INVESTMENTS COMPANYCONSOLIDATED STATEMENTS OF OPERATIONS(In thousands, except per share data) (Unaudited) For the Three Months Ended December 31, For the Twelve Months Ended December 31, 2024 2023 2024 2023 Asset management, admin. and distribution fees $439,520 $383,571 $1,677,143 $1,514,815 Information processing and software servicing fees 117,670 101,287 448,008 404,978 Total revenues 557,190 484,858 2,125,151 1,919,793 Subadvisory, distribution and other asset mgmt. costs 50,427 47,106 191,706 189,263 Software royalties and other information processing costs 8,726 8,505 34,229 32,289 Compensation, benefits and other personnel 200,347 184,508 770,881 714,099 Stock-based compensation 21,402 7,850 58,626 31,308 Consulting, outsourcing and professional fees 52,548 54,850 211,806 231,469 Data processing and computer related 38,863 34,735 151,653 137,036 Facilities, supplies and other costs 20,487 27,011 79,282 85,836 Amortization 10,585 9,818 41,869 38,669 Depreciation 8,261 8,791 33,358 35,300 Total expenses 411,646 383,174 1,573,410 1,495,269 Income from operations 145,544 101,684 551,741 424,524 Net (loss) gain from investments (559) 1,704 2,790 2,757 Interest and dividend income 12,947 11,574 48,897 41,027 Interest expense (144) (187) (563) (583) Other income — — 8,151 — Equity in earnings of unconsolidated affiliate 33,366 35,413 135,741 126,930 Income before income taxes 191,154 150,188 746,757 594,655 Income taxes 35,383 29,457 165,566 132,397 Net income $155,771 $120,731 $581,191 $462,258 Basic earnings per common share $1.21 $0.92 $4.47 $3.49 Shares used to calculate basic earnings per share 128,642 131,269 130,073 132,593 Diluted earnings per common share $1.19 $0.91 $4.41 $3.46 Shares used to calculate diluted earnings per share 131,421 132,160 131,727 133,728 Dividends declared per common share $0.49 $0.46 $0.95 $0.89 SEI INVESTMENTS COMPANYCONSOLIDATED CONDENSED BALANCE SHEETS(In thousands) (Unaudited) December 31,2024 December 31,2023 Assets Current Assets: Cash and cash equivalents $839,891 $834,697 Restricted cash 302 301 Receivables from investment products 54,118 55,886 Receivables, net of allowance for doubtful accounts of $1,435 and $663 567,634 501,434 Securities owned 29,583 31,334 Other current assets 60,282 54,464 Total Current Assets 1,551,810 1,478,116 Property and Equipment, net of accumulated depreciation of $493,219 and $474,034 159,643 171,364 Operating Lease Right-of-Use Assets 28,905 22,477 Capitalized Software, net of accumulated amortization of $641,071 and $612,971 236,023 239,783 Investments 315,567 273,510 Goodwill and Intangible Assets, net 247,657 219,776 Deferred Contract Costs 45,855 40,221 Deferred Income Taxes 51,984 37,709 Other Assets, net 47,162 37,047 Total Assets $2,684,606 $2,520,003 Liabilities and Equity Current Liabilities: Accounts payable $13,081 $10,618 Accrued liabilities 347,513 318,945 Current portion of long-term operating lease liabilities 7,900 8,118 Deferred revenue 12,019 15,366 Total Current Liabilities 380,513 353,047 Long-term Income Taxes Payable 803 803 Long-term Operating Lease Liabilities 24,235 17,235 Other Long-term Liabilities 26,943 17,090 Total Liabilities 432,494 388,175 Shareholders' Equity: Common stock, $0.01 par value, 750,000 shares authorized; 126,840 and 131,178shares issued and outstanding 1,268 1,312 Capital in excess of par value 1,539,816 1,404,962 Retained earnings 758,003 762,586 Accumulated other comprehensive loss, net (46,975) (37,032) Total Shareholders' Equity 2,252,112 2,131,828 Total Liabilities and Shareholders' Equity $2,684,606 $2,520,003 SEI INVESTMENTS COMPANYCONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS(In thousands) (Unaudited) For the Twelve Months Ended December 31, 2024 2023 Cash flows from operating activities: Net income $581,191 $462,258 Adjustments to reconcile net income to net cash provided by operating activities $41,152 ($15,228) Net cash provided by operating activities $622,343 $447,030 Net cash used in investing activities ($117,302) ($141,543) Net cash used in financing activities ($494,401) ($331,324) Effect of exchange rate changes on cash, cash equivalents and restricted cash (5,445) 7,476 Net increase (decrease) in cash, cash equivalents and restricted cash 5,195 (18,361) Cash, cash equivalents and restricted cash, beginning of period 834,998 853,359 Cash, cash equivalents and restricted cash, end of period $840,193 $834,998 ENDING ASSET BALANCES(In millions) (Unaudited) Dec. 31, 2023 Mar. 31, 2024 Jun. 30, 2024 Sept. 30, 2024 Dec. 31, 2024 Private Banks: Equity and fixed-income programs $24,496 $25,282 $25,031 $26,565 $25,523 Collective trust fund programs 4 5 5 5 4 Liquidity funds 3,916 2,733 2,699 2,948 2,688 Total assets under management $28,416 $28,020 $27,735 $29,518 $28,215 Client assets under administration 7,267 8,024 7,813 8,349 8,340 Total assets $35,683 $36,044 $35,548 $37,867 $36,555 Investment Advisors: Equity and fixed-income programs $71,634 $74,715 $74,556 $78,361 $76,283 Liquidity funds 4,812 4,722 4,301 2,790 3,105 Total Platform assets under management $76,446 $79,437 $78,857 $81,151 $79,388 Platform-only assets 18,324 20,516 21,908 24,501 25,244 Platform-only assets-deposit program 843 897 894 2,447 2,398 Total Platform assets $95,613 $100,850 $101,659 $108,099 $107,030 Institutional Investors: Equity and fixed-income programs $77,208 $75,969 $75,542 $79,252 $75,481 Collective trust fund programs 1 1 1 1 1 Liquidity funds 1,734 2,179 2,309 1,829 1,511 Total assets under management $78,943 $78,149 $77,852 $81,082 $76,993 Client assets under advisement 6,120 6,862 7,886 8,038 5,955 Total assets $85,063 $85,011 $85,738 $89,120 $82,948 Investment Managers: Collective trust fund programs (A) $156,376 $161,660 $192,747 $204,429 $202,384 Liquidity funds 114 202 221 233 188 Total assets under management $156,490 $161,862 $192,968 $204,662 $202,572 Client assets under administration 920,757 959,904 998,315 1,022,515 1,032,812 Total assets $1,077,247 $1,121,766 $1,191,283 $1,227,177 $1,235,384 Investments in New Businesses:Equity and fixed-income programs $2,174 $2,269 $2,285 $2,825 $2,747 Liquidity funds 209 223 631 246 297 Total assets under management $2,383 $2,492 $2,916 $3,071 $3,044 Client assets under advisement 1,150 1,248 1,886 2,021 2,185 Client assets under administration 14,807 15,411 14,848 15,110 14,791 Total assets $18,340 $19,151 $19,650 $20,202 $20,020 LSV Asset Management: Equity and fixed-income programs (B) $89,312 $93,616 $90,197 $93,855 $86,501 Total: Equity and fixed-income programs (C) $264,824 $271,851 $267,611 $280,858 $266,535 Collective trust fund programs 156,381 161,666 192,753 204,435 202,389 Liquidity funds 10,785 10,059 10,161 8,046 7,789 Total assets under management $431,990 $443,576 $470,525 $493,339 $476,713 Client assets under advisement 7,270 8,110 9,772 10,059 8,140 Client assets under administration (D) 942,831 983,339 1,020,976 1,045,974 1,055,943 Platform-only assets 19,167 21,413 22,802 26,948 27,642 Total assets $1,401,258 $1,456,438 $1,524,075 $1,576,320 $1,568,438 (A) Collective trust fund program assets in the Investment Managers segment are included in assets under management since SEI is the trustee. Fees earned on this product are less than fees earned on customized asset management programs. (B) Equity and fixed-income programs include $1.4 billion of assets managed by LSV in which fees are based solely on performance and are not calculated as an asset-based fee (as of December 31, 2024). (C) Equity and fixed-income programs include $6.4 billion of assets invested in various asset allocation funds (as of December 31, 2024). (D) In addition to the assets presented, SEI also administers an additional $10.3 billion in Funds of Funds assets on which SEI does not earn an administration fee (as of December 31, 2024). AVERAGE ASSET BALANCES(In millions) (Unaudited) 4th Qtr. 2023 1st Qtr. 2024 2nd Qtr. 2024 3rd Qtr. 2024 4th Qtr. 2024 Private Banks: Equity and fixed-income programs $23,309 $24,593 $24,859 $25,823 $26,067 Collective trust fund programs 5 4 5 5 4 Liquidity funds 3,808 3,902 2,734 2,858 2,814 Total assets under management $27,122 $28,499 $27,598 $28,686 $28,885 Client assets under administration 7,083 7,753 7,884 8,074 8,395 Total assets $34,205 $36,252 $35,482 $36,760 $37,280 Investment Advisors: Equity and fixed-income programs $68,369 $72,689 $73,793 $76,111 $77,866 Liquidity funds 5,046 4,649 4,348 4,264 3,031 Total Platform assets under management $73,415 $77,338 $78,141 $80,375 $80,897 Platform-only assets 17,201 19,198 20,897 23,194 25,109 Platform-only assets-deposit program 281 849 886 1,176 2,186 Total Platform assets $90,897 $97,385 $99,924 $104,745 $108,192 Institutional Investors: Equity and fixed-income programs $73,644 $76,414 $75,203 $77,473 $77,399 Collective trust fund programs 3 1 1 1 1 Liquidity funds 1,682 1,812 1,893 2,046 2,154 Total assets under management $75,329 $78,227 $77,097 $79,520 $79,554 Client assets under advisement 4,607 6,498 7,508 7,925 6,991 Total assets $79,936 $84,725 $84,605 $87,445 $86,545 Investment Managers: Collective trust fund programs (A) $149,551 $156,737 $189,884 $198,839 $204,954 Liquidity funds 205 207 227 245 223 Total assets under management $149,756 $156,944 $190,111 $199,084 $205,177 Client assets under administration 901,487 938,804 982,806 1,005,111 1,034,500 Total assets $1,051,243 $1,095,748 $1,172,917 $1,204,195 $1,239,677 Investments in New Businesses: Equity and fixed-income programs $2,069 $2,200 $2,234 $2,432 $2,819 Liquidity funds 197 214 471 546 269 Total assets under management $2,266 $2,414 $2,705 $2,978 $3,088 Client assets under advisement 1,080 1,194 2,014 1,885 2,110 Client assets under administration 14,781 15,147 14,713 14,973 14,961 Total assets $18,127 $18,755 $19,432 $19,836 $20,159 LSV Asset Management: Equity and fixed-income programs (B) $84,492 $90,708 $90,849 $93,195 $88,880 Total: Equity and fixed-income programs (C) $251,883 $266,604 $266,938 $275,034 $273,031 Collective trust fund programs 149,559 156,742 189,890 198,845 204,959 Liquidity funds 10,938 10,784 9,673 9,959 8,491 Total assets under management $412,380 $434,130 $466,501 $483,838 $486,481 Client assets under advisement 5,687 7,692 9,522 9,810 9,101 Client assets under administration (D) 923,351 961,704 1,005,403 1,028,158 1,057,856 Platform-only assets 17,482 20,047 21,783 24,370 27,295 Total assets $1,358,900 $1,423,573 $1,503,209 $1,546,176 $1,580,733 (A) Collective trust fund program average assets in the Investment Managers segment are included in assets under management since SEI is the trustee. Fees earned on this product are less than fees earned on customized asset management programs. (B) Equity and fixed-income programs during fourth-quarter 2024 include $1.5 billion of average assets managed by LSV in which fees are based solely on performance and are not calculated as an asset-based fee. (C) Equity and fixed-income programs include $6.4 billion of average assets invested in various asset allocation funds during fourth-quarter 2024. (D) In addition to the assets presented, SEI also administers an additional $9.4 billion of average assets in Funds of Funds assets during fourth-quarter 2024 on which SEI does not earn an administration fee. SALES EVENTS(In thousands) (Unaudited Net Recurring Sales Events 4th Qtr. 2023 1st Qtr. 2024 2nd Qtr. 2024 3rd Qtr. 2024 4th Qtr. 2024 Investment Processing-related Businesses: Private Banks $ 2,210 $ 247 $ 4,331 $ 9,417 $ 9,245 Investment Managers 15,314 20,407 17,180 23,319 18,027 Total Investment Processing-related Businesses $ 17,524 $ 20,654 $ 21,511 $ 32,736 $ 27,272 Asset Management-related Businesses: Private Banks-AMD $ (1,068) $ (85) $ (494) $ (854) $ 495 Investment Advisors (5,277) (942) (3,299) 2,686 1,339 Institutional Investors (4,151) (4,649) (1,787) (576) (2,673) Total Asset Management-related Businesses $ (10,496) $ (5,676) $ (5,580) $ 1,256 $ (839) Newer Initiatives: Investments in New Businesses $ 1,432 $ 1,494 $ (43) $ 936 $ 1,778 Total Net Recurring Sales Events $ 8,460 $ 16,472 $ 15,888 $ 34,928 $ 28,211 Non-Recurring Sales Events 4th Qtr. 2023 1st Qtr. 2024 2nd Qtr. 2024 3rd Qtr. 2024 4th Qtr. 2024 Investment Processing-related Businesses: Private Banks $ 3,489 $ 2,613 $ 4,431 $ 8,796 $ 6,622 Investment Managers 1,000 1,213 930 712 2,465 Total Investment Processing-related Businesses $ 4,489 $ 3,826 $ 5,361 $ 9,508 $ 9,087 Newer Initiatives: Investments in New Businesses $ 770 $ 987 $ 717 $ 1,976 $ 921 Total Non-Recurring Sales Events $ 5,259 $ 4,813 $ 6,078 $ 11,484 $ 10,008 Total Sales Events 4th Qtr. 2023 1st Qtr. 2024 2nd Qtr. 2024 3rd Qtr. 2024 4th Qtr. 2024 Investment Processing-related Businesses: Private Banks $ 5,699 $ 2,860 $ 8,762 $ 18,213 $ 15,867 Investment Managers 16,314 21,620 18,110 24,031 20,492 Total Investment Processing-related Businesses $ 22,013 $ 24,480 $ 26,872 $ 42,244 $ 36,359 Asset Management-related Businesses: Private Banks-AMD $ (1,068) $ (85) $ (494) $ (854) $ 495 Investment Advisors (5,277) (942) (3,299) 2,686 1,339 Institutional Investors (4,151) (4,649) (1,787) (576) (2,673) Total Asset Management-related Businesses $ (10,496) $ (5,676) $ (5,580) $ 1,256 $ (839) Newer Initiatives: Investments in New Businesses $ 2,202 $ 2,481 $ 674 $ 2,912 $ 2,699 Total Sales Events $ 13,719 $ 21,285 $ 21,966 $ 46,412 $ 38,219 SOURCE SEI Investments Company WANT YOUR COMPANY'S NEWS FEATURED ON PRNEWSWIRE.COM? 440k+ Newsrooms & Influencers 9k+ Digital Media Outlets 270k+ Journalists Opted In

SEI Reports Fourth-Quarter 2024 Financial Results

FAQ

Why Very Bullish?

How important is it?

Why Short Term?

Related Companies

Related News