- Solid investment performance, with 65%, 58%, 67%, and 72% of
assets under management (“AUM”) outperforming relevant benchmarks
on a one-, three-, five-, and 10-year basis, respectively, as of
September 30, 2023
- AUM decreased 4% compared to the second quarter 2023 to
US$308.3 billion
- US$(2.6) billion of net outflows in third quarter 2023 compared
to US$(5.8) billion of net outflows in third quarter 2022
- Third quarter 2023 diluted EPS of US$0.56, or US$0.64 on an
adjusted basis
- Board declared a quarterly dividend of US$0.39 per share and
approved a new share repurchase authorization of up to US$150
million of the Company's common shares
Janus Henderson Group plc (NYSE/ASX: JHG; “JHG” or the
“Company”) published its third quarter 2023 results for the period
ended September 30, 2023. Third quarter 2023 operating income was
US$108.3 million compared to US$117.9 million in the second quarter
2023 and US$120.7 million in the third quarter 2022. Adjusted
operating income, adjusted for one-time, acquisition and
transaction related costs, was US$125.4 million in the third
quarter 2023 compared to US$121.5 million in the second quarter
2023 and US$125.4 million in the third quarter 2022.
Third quarter 2023 diluted earnings per share of US$0.56
compared to US$0.54 in the second quarter 2023 and US$0.65 in the
third quarter 2022. Adjusted diluted earnings per share of US$0.64
in the third quarter 2023 compared to US$0.62 in the second quarter
2023 and compared to US$0.61 in the third quarter 2022.
Ali Dibadj, Chief Executive Officer, stated:
"I am pleased with our results this quarter, particularly amid
geopolitical conflicts and economic uncertainties. Our performance
remains solid, and we are seeing areas of strong market share
gains, including in Fixed Income and U.S. Intermediary. Our
financial results emphasize our cost discipline, as we have
surpassed our original 'Fuel for Growth' savings and timing through
delivering US$50 million in efficiencies a full year earlier than
expected. The new buyback authorization reflects our strong cash
flow generation and liquidity position and demonstrates our
commitment to balancing organic and inorganic investment in the
business and returning capital to shareholders. We will continue to
look actively to buy, build, or partner to diversify where clients
give us the right. Today’s results show we are making meaningful
progress, and we continue to deliver positive outcomes for our
shareholders and clients alike.”
SUMMARY OF FINANCIAL RESULTS (unaudited) (in US$ millions,
except per share data or as
noted)
The Company presents its financial results in US$ and in
accordance with accounting principles generally accepted in the
United States of America (“GAAP”). However, JHG management
evaluates the profitability of the Company and its ongoing
operations using additional non-GAAP financial measures. Management
uses these performance measures to evaluate the business, and
adjusted values are consistent with internal management reporting.
See “Reconciliation of non-GAAP financial information” below for
additional information.
Three months ended
30 Sep
30 Jun
30 Sep
2023
2023
2022
GAAP
basis:
Revenue
521.0
516.5
512.9
Operating expenses
399.3
398.6
392.2
Operating income
121.7
117.9
120.7
Operating margin
23.4
%
22.8
%
23.5
%
Net income attributable to JHG
93.5
89.8
107.6
Diluted earnings per share
0.56
0.54
0.65
Adjusted
basis:
Revenue
405.0
401.9
394.2
Operating expenses
279.6
280.4
268.8
Operating income
125.4
121.5
125.4
Operating margin
31.0
%
30.2
%
31.8
%
Net income attributable to JHG
106.7
102.0
101.1
Diluted earnings per share
0.64
0.62
0.61
DIVIDEND AND SHARE BUYBACK
On October 31, 2023, the Board declared a third quarter dividend
in respect of the three months ended September 30, 2023, of US$0.39
per share. Shareholders on the register on the record date of
November 13, 2023, will be paid the dividend on November 30,
2023.
Additionally, on October 31, 2023, the Board authorized a new
on-market share repurchase program under which JHG may repurchase,
from time to time, up to $150 million of the Company’s common
shares. This share repurchase program may be suspended, modified,
or discontinued at any time, but any repurchases under the program
must be made prior to the date of JHG’s 2024 Annual General Meeting
of Shareholders.
Some JHG executives and employees obtain rights to receive
shares of JHG common stock as part of their remuneration
arrangements and employee entitlements. In order to satisfy these
entitlements in a manner that is not dilutive to shareholders, the
Board separately approved the repurchase of up to four million
additional shares of common stock for the purpose of making grants
to these executives and employees.
AUM AND FLOWS (in US$ billions)
FX reflects movement in AUM resulting from changes in foreign
currency rates as non-US$ denominated AUM is translated into US$.
Redemptions include impact of client switches.
Total comparative AUM and flows
Three months ended
30 Sep
30 Jun
30 Sep
2023
2023
2022
Opening AUM
322.1
310.5
299.7
Sales
11.8
15.2
11.4
Redemptions
(14.4
)
(15.7
)
(17.2
)
Net sales / (redemptions)
(2.6
)
(0.5
)
(5.8
)
Market / FX
(11.2
)
12.1
(19.3
)
Closing AUM
308.3
322.1
274.6
Quarterly AUM and flows by capability
Fixed
Equities
Income
Multi-Asset
Alternatives
Total
AUM 30 Sep 2022
161.8
58.5
43.8
10.5
274.6
Sales
5.6
7.7
1.1
0.4
14.8
Redemptions
(13.1
)
(9.6
)
(2.1
)
(1.0
)
(25.8
)
Net sales / (redemptions)
(7.5
)
(1.9
)
(1.0
)
(0.6
)
(11.0
)
Market / FX
17.0
3.2
2.7
0.8
23.7
AUM 31 Dec 2022
171.3
59.8
45.5
10.7
287.3
Sales
10.7
7.3
1.0
0.5
19.5
Redemptions
(7.4
)
(3.7
)
(1.8
)
(1.1
)
(14.0
)
Net sales / (redemptions)
3.3
3.6
(0.8
)
(0.6
)
5.5
Market / FX
13.9
1.6
2.1
0.1
17.7
AUM 31 Mar 2023
188.5
65.0
46.8
10.2
310.5
Sales
8.6
5.1
1.1
0.4
15.2
Redemptions
(8.6
)
(4.1
)
(1.8
)
(1.2
)
(15.7
)
Net sales / (redemptions)
—
1.0
(0.7
)
(0.8
)
(0.5
)
Market / FX
10.6
(0.1
)
1.6
—
12.1
Reclassifications and disposals
0.4
—
—
(0.4
)
—
AUM 30 Jun 2023
199.5
65.9
47.7
9.0
322.1
Sales
5.7
4.8
1.0
0.3
11.8
Redemptions
(8.0
)
(3.9
)
(1.7
)
(0.8
)
(14.4
)
Net sales / (redemptions)
(2.3
)
0.9
(0.7
)
(0.5
)
(2.6
)
Market / FX
(8.0
)
(1.7
)
(1.7
)
0.2
(11.2
)
Reclassifications and disposals
(1.3
)
—
0.6
0.7
—
AUM 30 Sep 2023
187.9
65.1
45.9
9.4
308.3
Average AUM by capability
Three months ended
30 Sep
30 Jun
30 Sep
2023
2023
2022
Equities
196.9
193.4
182.4
Fixed Income
66.1
65.8
63.7
Multi-Asset
47.7
47.1
47.5
Alternatives
9.4
9.5
11.4
Total
320.1
315.8
305.0
INVESTMENT PERFORMANCE
% of AUM outperforming benchmark (as of September 30,
2023)
Capability
1-year
3-year
5-year
10-year
Equities
83
%
46
%
56
%
60
%
Fixed Income
56
%
61
%
77
%
91
%
Multi-Asset
4
%
98
%
96
%
97
%
Alternatives
65
%
97
%
97
%
100
%
Total
65
%
58
%
67
%
72
%
Outperformance is measured based on composite performance gross
of fees versus primary benchmark, except where a strategy has no
benchmark index or corresponding composite in which case the most
relevant metric is used: (1) composite gross of fees versus zero
for absolute return strategies, (2) fund net of fees versus primary
index, or (3) fund net of fees versus Morningstar peer group
average or median. Non-discretionary and separately managed account
assets are included with a corresponding composite where
applicable.
Cash management vehicles, ETF-enhanced beta strategies, Managed
CDOs, Private Equity funds, and custom non-discretionary accounts
with no corresponding composite are excluded from the analysis.
Performance across all time periods excludes Intech, the sale of
which was completed March 31, 2022. Excluded assets represent 4% of
AUM. Capabilities defined by Janus Henderson.
% of mutual fund AUM in top 2 Morningstar quartiles (as of
September 30, 2023)
Capability
1-year
3-year
5-year
10-year
Equities
76
%
69
%
80
%
88
%
Fixed Income
32
%
31
%
58
%
61
%
Multi-Asset
96
%
39
%
93
%
95
%
Alternatives
85
%
91
%
44
%
100
%
Total
75
%
60
%
79
%
87
%
Includes Janus Investment Fund, Janus Aspen Series and Clayton
Street Trust (U.S. Trusts), Janus Henderson Capital Funds (Dublin
based), Dublin and UK OEIC and Investment Trusts, Luxembourg
SICAVs, and Australian Managed Investment Schemes. Performance
across all time periods excludes Intech, the sale of which was
completed March 31, 2022. The top two Morningstar quartiles
represent funds in the top half of their category based on total
return. For the 1-, 3-, 5-, and 10-year periods ending September
30, 2023, 48%, 48%, 55%, and 61% of the 184, 175, 166, and 151
total mutual funds, respectively, were in the top 2 Morningstar
quartiles.
Analysis based on “primary” share class (Class I Shares,
Institutional Shares, or share class with longest history for U.S.
Trusts; Class A Shares or share class with longest history for
Dublin based; primary share class as defined by Morningstar for
other funds). Performance may vary by share class. Rankings may be
based, in part, on the performance of a predecessor fund or share
class and are calculated by Morningstar using a methodology that
differs from that used by Janus Henderson. Methodology differences
may have a material effect on the return and therefore the ranking.
When an expense waiver is in effect, it may have a material effect
on the total return, and therefore the ranking for the period.
ETFs and funds not ranked by Morningstar are excluded from the
analysis. Capabilities defined by Janus Henderson. © 2023
Morningstar, Inc. All Rights Reserved.
THIRD QUARTER 2023 RESULTS BRIEFING INFORMATION
Chief Executive Officer Ali Dibadj and Chief Financial Officer
Roger Thompson will present these results on November 1, 2023, on a
conference call and webcast to be held at 8 a.m. EDT, 12 p.m. GMT,
11 p.m. AEDT.
Those wishing to participate should call:
United States
833 470 1428 (toll free)
United Kingdom
0808 189 6484 (toll free)
Australia
02 7908 3093 (this is not toll free)
All other countries
+1 404 975 4839 (this is not toll
free)
Conference ID
689806
Access to the webcast and accompanying slides will be available
via the investor relations section of Janus Henderson’s website
(ir.janushenderson.com).
OTHER INFORMATION
Janus Henderson to Voluntarily Delist from ASX
Janus Henderson also announced that it has requested and
received formal approval to be voluntarily delisted from the
Australian Securities Exchange (“ASX”), where the Company’s common
stock trades in the form of Chess Depository Interests (“CDIs”).
The Company expects that the delisting will occur on or about
December 6, 2023. Following the delisting, the Company’s CDIs will
no longer trade on ASX; however, JHG common stock will continue to
be listed on the New York Stock Exchange (“NYSE”). The number of
outstanding shares of the Company's common stock will not be
impacted by the delisting. The delisting is not expected to have
any material impact on the Company’s financial position or
operating results other than in relation to savings in compliance
and certain ancillary costs associated with maintaining the ASX
listing. The Company intends to provide holders of the Company’s
CDIs additional information regarding their rights in connection
with the delisting, including their ability to sell their CDIs in
connection with the delisting or convert their CDIs into common
stock tradeable on the NYSE.
About Janus Henderson
Janus Henderson Group is a leading global active asset manager
dedicated to helping clients define and achieve superior financial
outcomes through differentiated insights, disciplined investments,
and world-class service. As of September 30, 2023, Janus Henderson
had approximately US$308.3 billion in assets under management, more
than 2,000 employees, and offices in 24 cities worldwide.
Headquartered in London, the company is listed on the NYSE and
ASX.
FINANCIAL DISCLOSURES
Condensed consolidated statements of comprehensive income
(unaudited)
Three months ended
30 Sep
30 Jun
30 Sep
(in US$ millions, except per share data
or as noted)
2023
2023
2022
Revenue:
Management fees
434.9
423.5
426.2
Performance fees
(15.8
)
(5.9
)
(13.2
)
Shareowner servicing fees
54.9
53.3
54.0
Other revenue
47.0
45.6
45.9
Total revenue
521.0
516.5
512.9
Operating expenses:
Employee compensation and benefits
149.2
147.7
142.5
Long-term incentive plans
32.6
37.6
41.1
Distribution expenses
116.0
114.6
118.7
Investment administration
12.4
11.1
12.5
Marketing
9.6
9.3
5.6
General, administrative and occupancy
73.7
72.2
64.7
Depreciation and amortization
5.8
6.1
7.1
Total operating expenses
399.3
398.6
392.2
Operating income
121.7
117.9
120.7
Interest expense
(3.2
)
(3.2
)
(3.1
)
Investment gains (losses), net
(5.9
)
6.9
11.0
Other non-operating income (expense),
net
(13.4
)
7.0
13.9
Income before taxes
99.2
128.6
142.5
Income tax provision
(13.2
)
(28.2
)
(27.9
)
Net income
86.0
100.4
114.6
Net loss (income) attributable to
noncontrolling interests
7.5
(10.6
)
(7.0
)
Net income attributable to JHG
93.5
89.8
107.6
Less: allocation of earnings to
participating stock-based awards
(2.8
)
(2.7
)
(3.5
)
Net income attributable to JHG common
shareholders
90.7
87.1
104.1
Basic weighted-average shares outstanding
(in millions)
160.8
160.5
160.5
Diluted weighted-average shares
outstanding (in millions)
160.9
160.7
160.9
Diluted earnings per share (in
US$)
0.56
0.54
0.65
Reconciliation of non-GAAP financial information
In addition to financial results reported in accordance with
GAAP, we compute certain financial measures using non-GAAP
components, as defined by the SEC. These measures are not in
accordance with, or a substitute for, GAAP, and our financial
measures may be different from non-GAAP financial measures used by
other companies. We have provided a reconciliation of our non-GAAP
components to the most directly comparable GAAP components. The
following are reconciliations of GAAP revenue, operating expenses,
operating income, net income attributable to JHG, and diluted
earnings per share to adjusted revenue, adjusted operating
expenses, adjusted operating income, adjusted net income
attributable to JHG, and adjusted diluted earnings per share.
Three months ended
30 Sep
30 Jun
30 Sep
(in US$ millions, except per share data
or as noted)
2023
2023
2022
Reconciliation of revenue to adjusted
revenue
Revenue
521.0
516.5
512.9
Management fees1
(41.4
)
(41.8
)
(46.0
)
Shareowner servicing fees1
(43.9
)
(43.3
)
(43.7
)
Other revenue1
(30.7
)
(29.5
)
(29.0
)
Adjusted revenue
405.0
401.9
394.2
Reconciliation of operating expenses to
adjusted operating expenses
Operating expenses
399.3
398.6
392.2
Employee compensation and benefits2
(0.9
)
(1.5
)
—
Long-term incentive plans2
2.4
(0.6
)
(2.4
)
Distribution expenses1
(116.0
)
(114.6
)
(118.7
)
General, administration and occupancy2
(4.7
)
(1.0
)
(1.7
)
Depreciation and amortization3
(0.5
)
(0.5
)
(0.6
)
Adjusted operating expenses
279.6
280.4
268.8
Adjusted operating income
125.4
121.5
125.4
Operating margin
23.4
%
22.8
%
23.5
%
Adjusted operating margin
31.0
%
30.2
%
31.8
%
Reconciliation of net income
attributable to JHG to adjusted net income attributable to
JHG
Net income attributable to JHG
93.5
89.8
107.6
Employee compensation and benefits2
0.9
1.5
—
Long-term incentive plans2
(2.4
)
0.6
2.4
General, administration and occupancy2
4.7
1.0
1.7
Depreciation and amortization3
0.5
0.5
0.6
Investment gains (losses), net4
(0.2
)
12.5
—
Other non-operating income (expense),
net4
25.6
—
(10.3
)
Income tax provision5
(15.9
)
(3.9
)
(0.9
)
Adjusted net income attributable to
JHG
106.7
102.0
101.1
Less: allocation of earnings to
participating stock-based awards
(3.2
)
(3.1
)
(3.3
)
Adjusted net income attributable to JHG
common shareholders
103.5
98.9
97.8
Weighted-average diluted common shares
outstanding – diluted (in millions)
160.9
160.7
160.9
Diluted earnings per share (in
US$)
0.56
0.54
0.65
Adjusted diluted earnings per share (in
US$)
0.64
0.62
0.61
1
JHG contracts with third-party
intermediaries to distribute and service certain of its investment
products. Fees for distribution and servicing related activities
are either provided for separately in an investment product’s
prospectus or are part of the management fee. Under both
arrangements, the fees are collected by JHG and passed through to
third-party intermediaries who are responsible for performing the
applicable services. The majority of distribution and servicing
fees collected by JHG are passed through to third-party
intermediaries. JHG management believes that the deduction of
distribution and servicing fees from revenue in the computation of
adjusted revenue reflects the pass-through nature of these
revenues. In certain arrangements, JHG performs the distribution
and servicing activities and retains the applicable fees. Revenues
for distribution and servicing activities performed by JHG are not
deducted from GAAP revenue.
2
Adjustments include rent expense,
rent income, other rent-related adjustments associated with
subleased office space, and the acceleration of long-term incentive
plan expense related to the departure of certain employees. JHG
management believes these costs are not representative of our
ongoing operations.
3
Investment management contracts
have been identified as a separately identifiable intangible asset
arising on the acquisition of subsidiaries and businesses. Such
contracts are recognized at the net present value of the expected
future cash flows arising from the contracts at the date of
acquisition. For segregated mandate contracts, the intangible asset
is amortized on a straight-line basis over the expected life of the
contracts. JHG management believes these non-cash and
acquisition-related costs are not representative of our ongoing
operations.
4
The adjustment for the three
months ended September 30, 2023, primarily consists of a provision
for a credit loss and a contingent consideration fair value
adjustment related to the 2022 sale of Intech. The adjustment for
the three months ended June 30, 2023, includes a correction due to
an error of previously recognized earnings associated with an
equity method investment. Adjustments for the three months ended
September 30, 2022, consist primarily of accumulated foreign
currency translation expense related to JHG liquidated entities.
JHG management believes these costs are not representative of our
ongoing operations.
5
The tax impact of the adjustments
is calculated based on the applicable U.S. or foreign statutory tax
rate as it relates to each adjustment. Certain adjustments are
either not taxable or not tax-deductible. Adjustments for the three
months ended September 30, 2023, were impacted by the change to our
state tax rate. As a result, the U.S. deferred tax assets and
liabilities were revalued from 23.9% to 23.5%, creating a non-cash
deferred tax benefit of $8.8 million.
Condensed consolidated balance sheets (unaudited)
30 Sep
31 Dec
(in US$ millions)
2023
2022
Assets:
Cash and cash equivalents
1,121.2
1,162.3
Investments
293.1
261.6
Property, equipment and software, net
45.3
51.8
Intangible assets and goodwill, net
3,675.7
3,667.8
Assets of consolidated variable interest
entities
351.6
352.0
Other assets
812.8
742.3
Total assets
6,299.7
6,237.8
Liabilities, redeemable noncontrolling
interests and equity:
Long-term debt
305.3
307.5
Deferred tax liabilities, net
568.7
574.6
Liabilities of consolidated variable
interest entities
14.2
4.3
Other liabilities
706.9
754.9
Redeemable noncontrolling interests
245.9
233.9
Total equity
4,458.7
4,362.6
Total liabilities, redeemable
noncontrolling interests and equity
6,299.7
6,237.8
Condensed consolidated statements of cash flows
(unaudited)
Three months ended
30 Sep
30 Jun
30 Sep
(in US$ millions)
2023
2023
2022
Cash provided by (used for):
Operating activities
216.9
171.4
221.9
Investing activities
16.0
(23.0
)
51.8
Financing activities
(91.5
)
1.9
(64.5
)
Effect of exchange rate changes
(25.5
)
11.8
(47.2
)
Net change during period
115.9
162.1
162.0
Basis of preparation
In the opinion of management of Janus Henderson Group plc, the
condensed consolidated financial statements contain all normal
recurring adjustments necessary to fairly present the financial
position, results of operations, and cash flows of JHG in
accordance with GAAP. Such financial statements have been prepared
in accordance with the instructions to Form 10‑Q pursuant to the
rules and regulations of the SEC. Certain information and footnote
disclosures normally included in financial statements prepared in
accordance with GAAP have been condensed or omitted pursuant to
such rules and regulations. The financial statements should be read
in conjunction with the annual consolidated financial statements
and notes presented in Janus Henderson’s Annual Report on Form 10‑K
for the year ended December 31, 2022, filed with the SEC
(Commission File No. 001‑38103). Events subsequent to the balance
sheet date have been evaluated for inclusion in the financial
statements through the issuance date and are included in the notes
to the condensed consolidated financial statements.
FORWARD-LOOKING STATEMENTS DISCLAIMER
Past performance is no guarantee of future results. Investing
involves risk, including the possible loss of principal and
fluctuation of value.
This document includes statements concerning potential future
events involving Janus Henderson Group plc that could differ
materially from the events that actually occur. The differences
could be caused by a number of factors, including, but not limited
to, increasing interest rates and inflation, volatility, or
disruption in financial markets, our investment performance as
compared to third-party benchmarks or competitive products,
redemptions and other withdrawals from the funds and accounts we
manage, and other factors identified in JHG’s Annual Report on Form
10‑K for the fiscal year ended December 31, 2022, and in other
filings or furnishings made by the Company with the Securities and
Exchange Commission from time to time (Commission File No.
001‑38103), including those that appear under headings such as
“Risk Factors” and “Management’s Discussion and Analysis of
Financial Condition and Results of Operations.” Many of these
factors are beyond the control of JHG and its management. Any
forward-looking statements contained in this document are as of the
date on which such statements were made. The Company undertakes no
obligation to publicly update or revise any forward-looking
statements after the date they are made, whether as a result of new
information, future events, or otherwise, except as required by
law.
Annualized, pro forma, projected, and estimated numbers are used
for illustrative purposes only, are not forecasts, and may not
reflect actual results.
The information, statements, and opinions contained in this
document do not constitute a public offer under any applicable
legislation or an offer to sell or solicitation of any offer to buy
any securities or financial instruments or any advice or
recommendation with respect to such securities or other financial
instruments.
Not all products or services are available in all
jurisdictions.
Janus Henderson is a trademark of Janus Henderson Group plc or
one of its subsidiaries. © Janus Henderson Group plc.
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Investor enquiries: Jim Kurtz Head of Investor Relations
+1 303 336 4529 jim.kurtz@janushenderson.com Or Investor Relations
investor.relations@janushenderson.com
Media enquiries: Nicole Mullin Director of Media
Relations +44 (0)20 7818 2511 nicole.mullin@janushenderson.com
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