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Dec 31, 2023
Silvercrest Q4 2023 Earnings Report
Silvercrest's Q4 2023 results were reported, with AUM increasing but revenue remaining flat year-over-year. The company faced challenges due to adjustments in total compensation, impacting Adjusted EBITDA and Adjusted Diluted Earnings per Share. However, increased AUM and a stronger business pipeline set the stage for a potentially improved environment in 2024.
Key Takeaways
Silvercrest Asset Management Group Inc. reported flat revenue year-over-year for Q4 2023 at $28.5 million. Adjusted EBITDA decreased to $2.6 million, or 9.0% of revenue, and Adjusted Diluted Earnings per Share decreased to $0.07. Total AUM increased to $33.3 billion, driven by market appreciation.
Total AUM reached $33.3 billion, including $21.9 billion in discretionary AUM and $11.4 billion in non-discretionary AUM.
Revenue was $28.5 million, remaining flat compared to the same quarter last year.
The company reported a GAAP consolidated net loss of $0.6 million.
Adjusted EBITDA was $2.6 million, or 9.0% of revenue.
Forward Guidance
Silvercrest anticipates a more favorable environment in 2024, supported by increased AUM during the fourth quarter of 2023 and into 2024. The company's pipeline of new business opportunities has significantly improved, particularly within the institutional sector, and OCIO AUM has seen growth, including a new college endowment.
Positive Outlook
- AUM increased during the fourth quarter of 2023 and into 2024.
- The pipeline of new business opportunities has significantly improved.
- Actionable institutional business pipeline has increased to $735 million.
- OCIO AUM has risen to $1.7 billion, including a new small college endowment.
- The OCIO pipeline has increased to $585 million, and consultant relationships have strengthened.
Challenges Ahead
- The institutional search environment remains slow.
- Financial results in the fourth quarter were negatively affected by adjustments to total compensation for 2023.
- Total recurring cash compensation as a percentage of revenue rose to 59% from Silvercrest’s typical interim accrual rate of 55%.
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