- Q3 2023 earnings per diluted share of $0.86
- Total assets under management reach a record high of
$715.2 billion
- Money market assets reach a record $525.1 billion
- Board declares $0.28 per share
dividend; authorizes new share repurchase program
PITTSBURGH, Oct. 26,
2023 /PRNewswire/ -- Federated Hermes, Inc. (NYSE:
FHI), a global leader in active, responsible investing, today
reported earnings per diluted share (EPS) of $0.86 for Q3 2023, compared to $0.78 for the same quarter last year, on net
income of $75.0 million for Q3 2023,
compared to $69.5 million for Q3
2022. Federated Hermes reported YTD 2023 EPS of $2.44, compared to $2.02 for the same period in 2022, on YTD 2023
net income of $216.8 million,
compared to $183.0 million for the
same period in 2022.
Federated Hermes' total managed assets were a record
$715.2 billion at Sept. 30,
2023, up $90.8 billion or 15%
from $624.4 billion at
Sept. 30, 2022 and up $11.2
billion or 2% from $704.0
billion at June 30, 2023. Total average managed
assets for Q3 2023 were $711.2
billion, up $79.4 billion or
13% from $631.8 billion reported for
Q3 2022 and up $5.9 billion or
1% from $705.3 billion for Q2
2023.
"Record assets under management at the end of the third quarter
were again driven by money market asset increases, particularly
investor demand for our prime money market offerings in the current
interest rate environment, where general market volatility made the
improved yields of our cash offerings an appealing haven for
investors," said J. Christopher
Donahue, president and chief executive officer. "Net sales
of fixed-income products were led by multi-sector fixed-income
separate accounts and net sales of our flagship core-plus offering,
Federated Hermes Total Return Bond Fund. In equities, we saw demand
for Federated Hermes' international equity products and our MDT
strategies, which take a quantitative approach to stock selection
with proprietary research and technology."
Federated Hermes' board of directors declared a dividend of
$0.28 per share. The dividend is
payable on Nov. 15, 2023 to
shareholders of record as of Nov. 8,
2023. During Q3 2023, Federated Hermes purchased 2,046,790
shares of Federated Hermes class B common stock for $68.9
million. The board of directors also authorized an additional share
repurchase program, which is the firm's 16th, allowing the buyback
of up to an additional 5 million shares of Federated Hermes class B
common stock in the open market with no expiration date. The
repurchased stock is to be held in treasury for employee
share-based compensation plans, potential acquisitions and other
corporate activities. The company's existing 5 million share
repurchase program, approved in June
2022, has approximately 1.4 million shares remaining.
Equity assets were $77.3 billion
at Sept. 30, 2023, up $2.6
billion or 4% from $74.7
billion at Sept. 30, 2022 and down
$5.7 billion or 7% from $83.0 billion at
June 30, 2023. Top-selling equity funds during Q3
2023 on a net basis were Federated Hermes MDT Large Cap Growth
Fund, Federated Hermes International Leaders Fund, Federated Hermes
U.S. SMID Equity Fund, Federated Hermes International Small-Mid
Company Fund and Federated Hermes MDT All Cap Core Fund.
Fixed-income assets were $89.8
billion at Sept. 30, 2023, up
$4.4 billion or 5% from $85.4 billion at Sept. 30,
2022 and up $2.4 billion or 3%
from $87.4 billion at June 30, 2023. Top-selling fixed-income funds
during Q3 2023 on a net basis were Federated Hermes Total
Return Bond Fund, Federated Hermes Intermediate Corporate Bond
Fund, Federated Hermes Sterling Cash Plus Fund, Federated Hermes
Total Return Bond Collective Investment Fund and Federated Hermes
SDG Engagement High Yield Credit Fund.
Alternative/private markets assets were $20.3 billion at Sept. 30, 2023, up
$0.1 billion or less than 1% from
$20.2 billion at
Sept. 30, 2022 and down $1.3
billion or 6% from $21.6
billion at June 30, 2023.
Money market assets were a record $525.1
billion at Sept. 30, 2023, up $83.8 billion or 19% from $441.3 billion at Sept. 30, 2022 and up
$16.1 billion or 3% from $509.0 billion at June 30, 2023. Money
market fund assets were a record $384.9
billion at Sept. 30, 2023, up $75.0 billion or 24% from $309.9 billion at Sept. 30, 2022 and up
$20.9 billion or 6% from $364.0 billion at June 30, 2023.
Financial Summary
Q3 2023 vs. Q3 2022
Revenue increased $21.5 million or
6% primarily due to an increase in revenue from money market assets
and an increase in carried interest and performance fees of
$10.8 million, including
$7.5 million of carried interest from
consolidated carried interest vehicles and is offset in
compensation expense. These increases were partially offset by a
decrease in revenue related to changes in the mix of average
equity and fixed-income assets.
During Q3 2023, Federated Hermes derived 53% of its revenue from
long-term assets (31% from equity, 12% from fixed-income, and 10%
from alternative/private markets and multi-asset), 46% from
money market assets, and 1% from sources other than managed
assets.
Operating expenses increased $16.9
million or 6% primarily due to increased compensation
expenses resulting from consolidated carried interest vehicles of
$7.6 million.
Nonoperating income (expenses), net increased $7.1 million primarily due to an increase in
investment yields due to rising interest rates and a larger
decrease in the market value of investments in Q3 2022 compared to
the decrease in Q3 2023.
Q3 2023 vs. Q2 2023
Revenue decreased $30.6 million or
7% primarily due to a decrease in carried interest and
performance fees of $24.5 million,
including $15.5 million of carried interest from consolidated
carried interest vehicles and is offset in compensation expense.
Revenue from money market assets decreased by $9.0 million, offset by an $8.2 million decrease in related distribution
expense due to changes in asset levels, asset mix and product
structures. These decreases were partially offset by an
increase in revenue due to one additional day in Q3 2023.
Operating expenses decreased $33.6
million or 10% primarily due to decreased compensation
expenses resulting from consolidated carried interest vehicles of
$15.9 million and the decrease in
distribution expense from money market assets mentioned above.
Nonoperating income (expenses), net decreased $2.6 million primarily due to a decrease in the
market value of investments in Q3 2023 compared to Q2 2023.
YTD 2023 vs. YTD 2022
Revenue increased $146.2 million
or 14% primarily due to the elimination of voluntary fee
waivers related to certain money market funds in order for those
funds to maintain positive or zero net yields (voluntary
yield-related fee waivers), an increase in revenue from money
market assets and an increase in carried interest and performance
fees of $49.0 million, including
$31.9 million of carried interest
from consolidated carried interest vehicles and is offset in
compensation expense. For further information on the waivers, see
"Impact of voluntary yield-related fee waivers" below. These
increases were partially offset by a decrease in revenue due to
lower average long-term assets.
For the first nine months of 2023, Federated Hermes
derived 53% of its revenue from long-term assets (30% from
equity, 12% from fixed-income and 11% from alternative/private
markets and multi-asset), 46% from money market assets, and 1%
from sources other than managed assets.
Operating expenses increased $134.2
million or 17% primarily due to an increase in distribution
expense mainly due to the elimination of voluntary yield-related
fee waivers, increased compensation expenses resulting from
consolidated carried interest vehicles of $32.8 million, and an increase in professional
service fees.
Nonoperating income (expenses), net increased $51.0 million primarily due to an increase in the
market value of investments in the first nine months of 2023
compared to a decrease in the market value of investments for the
same period in 2022 and an increase in investment yields due to
rising interest rates.
Impact of voluntary yield-related fee waivers
There were no voluntary yield-related fee waivers during the
three and nine months ended Sept. 30, 2023, and no material
voluntary yield-related fee waivers for the three months ended
Sept. 30, 2022. During the nine months ended
Sept. 30, 2022, voluntary yield-related fee waivers
totaled $85.3 million. These fee
waivers were partially offset by related reductions in Distribution
expense of $66.5 million, such that
the net negative pre-tax impact to Federated Hermes was
$18.8 million for the nine months
ended Sept. 30, 2022.
Earnings call information
Federated Hermes will host an earnings conference call at
9 a.m. Eastern on Oct. 27, 2023. Investors are invited to listen to
the earnings teleconference by calling 888-506-0062 (domestic) or
973-528-0011 (international) prior to the 9 a.m. start time.
To listen online, go to the About section of FederatedHermes.com/us
at least 15 minutes prior to register and join the call. A replay
will be available at approximately 12:30
p.m. Eastern on Oct. 27, 2023.
To access the telephone replay, dial 877-481-4010 (domestic) or
919-882-2331 (international) and enter access code 49196. The
online replay will be available via FederatedHermes.com/us for
one year.
About Federated Hermes
Federated Hermes, Inc. is a global leader in active, responsible
investment management, with $715.2
billion in assets under management1. We deliver
investment solutions that help investors target a broad range of
outcomes and provide equity, fixed-income, alternative/private
markets, multi-asset and liquidity management strategies to more
than 10,000 institutions and intermediaries worldwide. Our clients
include corporations, government entities, insurance companies,
foundations and endowments, banks and broker/dealers. Headquartered
in Pittsburgh, Federated Hermes
has more than 2,000 employees in London, New
York, Boston and offices
worldwide.
Federated Hermes ranks in the top 7% of equity fund managers in
the industry, the top 9% of money market fund managers and the
top 11% of fixed-income fund managers2. Federated
Hermes also ranks as the 8th-largest manager of model-delivered
separately managed accounts3. For more information,
including an analyst presentation, which is updated periodically,
visit FederatedHermes.com/us.
###
1) As of Sept. 30,
2023.
2) Morningstar, Sept.
30, 2023. Based on U.S. fund flows rankings.
3)
Money Management Institute/Cerulli,Q2 2023.
Federated Securities Corp. is distributor of the Federated
Hermes funds.
Separately managed accounts are made available through
Federated Global Investment Management Corp., Federated Investment
Counseling, Federated MDTA LLC, Hermes Fund Managers Ireland
Limited, Hermes Investment Management Limited, and Hermes GPE LLP,
each a registered investment advisor in one or more of the U.S.,
U.K. or Ireland.
Cautionary statements
Certain statements in this press release, such as those related
to performance, investor preferences and demand, asset flows, asset
mix, interest rates and fee waivers constitute or may constitute
forward-looking statements, which involve known and unknown risks,
uncertainties and other factors that may cause the actual results,
levels of activity, performance or achievements of the company, or
industry results, to be materially different from any future
results, levels of activity, performance or achievements expressed
or implied by such forward-looking statements. Forward-looking
statements can include statements that do not relate strictly to
historical or current facts and are typically identified by words
or phrases such as "trend," "forecast," "project," "predict,"
"potential," "approximate," "opportunity," "believe," "expect,"
"anticipate," "current," "intention," "estimate," "position,"
"projection," "plan," "assume," "continue," "remain," "maintain,"
"sustain," "seek," "achieve," and similar expressions, or future or
conditional verbs such as "will," "would," "should," "could,"
"can," "may" and similar expressions. Any forward-looking
statement, and Federated Hermes' level of business activity and
financial results, are inherently subject to significant business,
market, economic, competitive, regulatory and other risks and
uncertainties, many of which are difficult to predict and beyond
Federated Hermes' control. Other risks and uncertainties include
the ability of the company to predict the level of fee waivers and
expenses in future quarters, predict whether performance fees or
carried interest will be earned and retained, the ability of the
company to sustain product demand, the timing and level of product
sales and redemptions, market appreciation or depreciation,
revenues, and asset levels, flows and mix, which could vary
significantly depending on various factors, such as market
conditions, investment performance and investor behavior. Other
risks and uncertainties include the risk factors discussed in the
company's annual and quarterly reports as filed with the Securities
and Exchange Commission. As a result, no assurance can be given as
to future results, levels of activity, performance or achievements,
and neither the company nor any other person assumes responsibility
for the accuracy and completeness, or updating, of such statements
in the future.
Unaudited
Condensed Consolidated Statements of Income
|
(in thousands,
except per share data)
|
|
|
|
|
|
|
|
Quarter
Ended
|
% Change
Q3 2022 to
Q3 2023
|
|
Quarter
Ended
|
% Change
Q2 2023 to
Q3 2023
|
|
Sept. 30,
2023
|
Sept. 30, 2022
|
|
June 30, 2023
|
Revenue
|
|
|
|
|
|
|
Investment advisory
fees, net
|
$
276,771
|
$
263,644
|
5 %
|
|
$
310,337
|
(11) %
|
Administrative service
fees, net—affiliates
|
88,023
|
75,021
|
17
|
|
85,199
|
3
|
Other service fees,
net
|
37,862
|
42,478
|
(11)
|
|
37,696
|
0
|
Total
Revenue
|
402,656
|
381,143
|
6
|
|
433,232
|
(7)
|
|
|
|
|
|
|
|
Operating
Expenses
|
|
|
|
|
|
|
Compensation and
related
|
139,123
|
126,668
|
10
|
|
159,883
|
(13)
|
Distribution
|
89,838
|
91,032
|
(1)
|
|
97,086
|
(7)
|
Systems and
communications
|
21,213
|
19,294
|
10
|
|
22,074
|
(4)
|
Professional service
fees
|
17,561
|
14,203
|
24
|
|
19,099
|
(8)
|
Office and
occupancy
|
10,632
|
10,622
|
0
|
|
11,404
|
(7)
|
Advertising and
promotional
|
3,857
|
6,496
|
(41)
|
|
5,109
|
(25)
|
Travel and
related
|
4,034
|
3,421
|
18
|
|
3,835
|
5
|
Intangible asset
related
|
3,451
|
2,894
|
19
|
|
3,418
|
1
|
Other
|
11,523
|
9,733
|
18
|
|
12,935
|
(11)
|
Total Operating
Expenses
|
301,232
|
284,363
|
6
|
|
334,843
|
(10)
|
Operating
Income
|
101,424
|
96,780
|
5
|
|
98,389
|
3
|
|
|
|
|
|
|
|
Nonoperating Income
(Expenses)
|
|
|
|
|
|
|
Investment income
(loss), net
|
2,722
|
(4,226)
|
164
|
|
5,289
|
(49)
|
Debt
expense
|
(3,133)
|
(3,302)
|
(5)
|
|
(3,118)
|
0
|
Other, net
|
(8)
|
(38)
|
79
|
|
(15)
|
47
|
Total Nonoperating
Income (Expenses), net
|
(419)
|
(7,566)
|
94
|
|
2,156
|
(119)
|
Income before income
taxes
|
101,005
|
89,214
|
13
|
|
100,545
|
0
|
Income tax
provision
|
26,739
|
21,640
|
24
|
|
27,543
|
(3)
|
Net income including
the noncontrolling interests in subsidiaries
|
74,266
|
67,574
|
10
|
|
73,002
|
2
|
Less: Net income
(loss) attributable to the noncontrolling interests in
subsidiaries
|
(760)
|
(1,905)
|
60
|
|
827
|
(192)
|
Net Income
|
$
75,026
|
$
69,479
|
8 %
|
|
$
72,175
|
4 %
|
|
|
|
|
|
|
|
Amounts Attributable
to Federated Hermes, Inc.
|
|
|
|
|
|
|
Earnings Per
Share1
|
|
|
|
|
|
|
Basic and
diluted
|
$
0.86
|
$
0.78
|
10 %
|
|
$
0.81
|
6 %
|
Weighted-Average
Shares Outstanding
|
|
|
|
|
|
|
Basic
|
83,710
|
84,531
|
|
|
84,930
|
|
Diluted
|
83,710
|
84,536
|
|
|
84,939
|
|
Dividends Declared
Per Share
|
$
0.28
|
$
0.27
|
|
|
$
0.28
|
|
|
|
1)
|
Unvested share-based awards that receive
non-forfeitable dividend rights are deemed participating securities
and are required to be considered in the computation of earnings
per share under the "two-class method." As such, total net income
of $3.3 million, $3.6 million and $3.5 million available to
unvested restricted Federated Hermes shareholders for the quarterly
periods ended Sept. 30, 2023, Sept. 30, 2022 and
June 30, 2023, respectively, was excluded from the
computation of earnings per share.
|
Unaudited
Condensed Consolidated Statements of Income
|
|
|
|
(in thousands,
except per share data)
|
|
|
|
|
Nine Months
Ended
|
|
Sept. 30,
2023
|
Sept. 30, 2022
|
%
Change
|
Revenue
|
|
|
|
Investment advisory
fees, net
|
$
851,089
|
$
754,681
|
13 %
|
Administrative service
fees, net—affiliates
|
252,402
|
218,710
|
15
|
Other service fees,
net
|
114,586
|
98,524
|
16
|
Total
Revenue
|
1,218,077
|
1,071,915
|
14
|
|
|
|
|
Operating
Expenses
|
|
|
|
Compensation and
related
|
435,884
|
388,719
|
12
|
Distribution
|
280,258
|
223,837
|
25
|
Systems and
communications
|
63,259
|
57,234
|
11
|
Professional service
fees
|
52,881
|
41,647
|
27
|
Office and
occupancy
|
34,910
|
32,457
|
8
|
Advertising and
promotional
|
13,308
|
13,965
|
(5)
|
Travel and
related
|
11,101
|
8,543
|
30
|
Intangible asset
related
|
10,194
|
9,319
|
9
|
Other
|
31,303
|
23,147
|
35
|
Total Operating
Expenses
|
933,098
|
798,868
|
17
|
Operating
Income
|
284,979
|
273,047
|
4
|
|
|
|
|
Nonoperating Income
(Expenses)
|
|
|
|
Investment income
(loss), net
|
18,322
|
(34,136)
|
154
|
Debt
expense
|
(9,377)
|
(7,873)
|
19
|
Other, net
|
101
|
31
|
226
|
Total Nonoperating
Income (Expenses), net
|
9,046
|
(41,978)
|
122
|
Income before income
taxes
|
294,025
|
231,069
|
27
|
Income tax
provision
|
75,291
|
58,140
|
29
|
Net income including
the noncontrolling interests in subsidiaries
|
218,734
|
172,929
|
26
|
Less: Net income
(loss) attributable to the noncontrolling interests in
subsidiaries
|
1,932
|
(10,070)
|
119
|
Net Income
|
$
216,802
|
$
182,999
|
18 %
|
|
|
|
|
Amounts Attributable
to Federated Hermes, Inc.
|
|
|
|
Earnings Per
Share1
|
|
|
|
Basic and
diluted
|
$
2.44
|
$
2.02
|
21 %
|
Weighted-Average
Shares Outstanding
|
|
|
|
Basic
|
84,499
|
86,109
|
|
Diluted
|
84,502
|
86,111
|
|
Dividends Declared
Per Share
|
$
0.83
|
$
0.81
|
|
|
|
1)
|
Unvested share-based
awards that receive non-forfeitable dividend rights are deemed
participating securities and are required to be considered in the
computation of earnings per share under the "two-class method." As
such, total net income of $10.3 million and $9.1 million available
to unvested restricted Federated Hermes shareholders for the nine
months ended Sept. 30, 2023 and Sept. 30, 2022, respectively, was
excluded from the computation of earnings per share.
|
Unaudited
Condensed Consolidated Balance Sheets
|
|
|
(in
thousands)
|
Sept. 30,
2023
|
Dec. 31,
2022
|
Assets
|
|
|
Cash and other
investments
|
$
554,433
|
$
521,754
|
Other current
assets
|
157,227
|
129,277
|
Intangible
assets, net, including goodwill
|
1,203,527
|
1,209,574
|
Other long-term
assets
|
165,153
|
159,874
|
Total
Assets
|
$
2,080,340
|
$
2,020,479
|
|
|
|
Liabilities,
Redeemable Noncontrolling Interests and Equity
|
|
|
Current
liabilities
|
$
255,587
|
$
257,413
|
Long-term
debt
|
347,777
|
347,581
|
Other long-term
liabilities
|
306,307
|
307,972
|
Redeemable
noncontrolling interests
|
70,631
|
61,821
|
Equity excluding
treasury stock
|
1,573,370
|
1,411,055
|
Treasury
stock
|
(473,332)
|
(365,363)
|
Total
Liabilities, Redeemable Noncontrolling Interests and
Equity
|
$
2,080,340
|
$
2,020,479
|
Unaudited Changes
in Long-Term Assets - By Asset Class
|
|
|
|
(in
millions)
|
Quarter
Ended
|
|
Nine Months
Ended
|
|
Sept. 30,
2023
|
June 30, 2023
|
Sept. 30, 2022
|
|
Sept. 30,
2023
|
Sept. 30, 2022
|
Equity
|
|
|
|
|
|
|
Beginning
assets
|
$
82,992
|
$
83,629
|
$
80,988
|
|
$
81,523
|
$
96,716
|
Sales1
|
3,897
|
4,869
|
5,133
|
|
14,397
|
18,720
|
Redemptions1
|
(6,304)
|
(5,697)
|
(4,951)
|
|
(16,737)
|
(19,585)
|
Net sales
(redemptions)1
|
(2,407)
|
(828)
|
182
|
|
(2,340)
|
(865)
|
Net
exchanges
|
18
|
5
|
9
|
|
126
|
(145)
|
Impact of foreign
exchange2
|
(532)
|
71
|
(1,187)
|
|
(353)
|
(2,840)
|
Market gains and
(losses)3
|
(2,756)
|
115
|
(5,308)
|
|
(1,641)
|
(18,182)
|
Ending
assets
|
$
77,315
|
$
82,992
|
$
74,684
|
|
$
77,315
|
$
74,684
|
|
|
|
|
|
|
|
Fixed
Income
|
|
|
|
|
|
|
Beginning
assets
|
$
87,425
|
$
87,461
|
$
86,253
|
|
$
86,743
|
$
97,550
|
Sales1
|
8,277
|
4,891
|
7,681
|
|
19,215
|
22,096
|
Redemptions1
|
(5,133)
|
(4,963)
|
(6,584)
|
|
(17,223)
|
(24,971)
|
Net sales
(redemptions)1
|
3,144
|
(72)
|
1,097
|
|
1,992
|
(2,875)
|
Net
exchanges
|
(25)
|
6
|
(17)
|
|
(120)
|
78
|
Impact of foreign
exchange2
|
(96)
|
43
|
(231)
|
|
(15)
|
(560)
|
Market gains and
(losses)3
|
(683)
|
(13)
|
(1,737)
|
|
1,165
|
(8,828)
|
Ending
assets
|
$
89,765
|
$
87,425
|
$
85,365
|
|
$
89,765
|
$
85,365
|
|
|
|
|
|
|
|
Alternative/Private
Markets
|
|
|
|
|
|
|
Beginning
assets
|
$
21,602
|
$
21,174
|
$
21,785
|
|
$
20,802
|
$
22,920
|
Sales1
|
660
|
643
|
946
|
|
2,568
|
2,706
|
Redemptions1
|
(866)
|
(745)
|
(929)
|
|
(2,403)
|
(2,525)
|
Net sales
(redemptions)1
|
(206)
|
(102)
|
17
|
|
165
|
181
|
Net
exchanges
|
(3)
|
(4)
|
3
|
|
(6)
|
7
|
Impact of foreign
exchange2
|
(762)
|
539
|
(1,638)
|
|
145
|
(3,830)
|
Market gains and
(losses)3
|
(294)
|
(5)
|
15
|
|
(769)
|
904
|
Ending
assets
|
$
20,337
|
$
21,602
|
$
20,182
|
|
$
20,337
|
$
20,182
|
|
|
|
|
|
|
|
Multi-asset
|
|
|
|
|
|
|
Beginning
assets
|
$
2,922
|
$
2,973
|
$
3,135
|
|
$
2,989
|
$
3,780
|
Sales1
|
30
|
33
|
54
|
|
110
|
171
|
Redemptions1
|
(119)
|
(143)
|
(132)
|
|
(406)
|
(407)
|
Net sales
(redemptions)1
|
(89)
|
(110)
|
(78)
|
|
(296)
|
(236)
|
Net
exchanges
|
0
|
1
|
0
|
|
3
|
6
|
Market gains and
(losses)3
|
(105)
|
58
|
(155)
|
|
32
|
(648)
|
Ending
assets
|
$
2,728
|
$
2,922
|
$
2,902
|
|
$
2,728
|
$
2,902
|
|
|
|
|
|
|
|
Total Long-term
Assets
|
|
|
|
|
|
|
Beginning
assets
|
$
194,941
|
$
195,237
|
$
192,161
|
|
$
192,057
|
$
220,966
|
Sales1
|
12,864
|
10,436
|
13,814
|
|
36,290
|
43,693
|
Redemptions1
|
(12,422)
|
(11,548)
|
(12,596)
|
|
(36,769)
|
(47,488)
|
Net sales
(redemptions)1
|
442
|
(1,112)
|
1,218
|
|
(479)
|
(3,795)
|
Net
exchanges
|
(10)
|
8
|
(5)
|
|
3
|
(54)
|
Impact of foreign
exchange2
|
(1,390)
|
653
|
(3,056)
|
|
(223)
|
(7,230)
|
Market gains and
(losses)3
|
(3,838)
|
155
|
(7,185)
|
|
(1,213)
|
(26,754)
|
Ending
assets
|
$
190,145
|
$
194,941
|
$
183,133
|
|
$
190,145
|
$
183,133
|
|
|
1)
|
For certain accounts,
Sales and Redemptions are calculated as the remaining difference
between beginning and ending assets after the calculation of total
investment return.
|
2)
|
Reflects the impact of
translating non-U.S. dollar denominated assets under management
(AUM) into U.S. dollars for reporting purposes.
|
3)
|
Reflects the
approximate changes in the fair value of the securities held by
portfolios and, to a lesser extent, reinvested dividends,
distributions and net investment income.
|
Unaudited Changes
in Long-Term Assets - By Asset Class and Product
Type
|
(in
millions)
|
|
|
Quarter
Ended
|
|
Sept. 30,
2023
|
|
Equity
|
Fixed
Income
|
Alternative /
Private
Markets
|
Multi-asset
|
Total
|
|
Funds
|
Separate
Accounts1
|
Funds
|
Separate
Accounts1
|
Funds
|
Separate
Accounts1
|
Funds
|
Separate
Accounts1
|
Funds.
|
Separate
Accounts1
|
Beginning
assets
|
$
44,383
|
$
38,609
|
$ 43,884
|
$ 43,541
|
$
13,338
|
$ 8,264
|
$ 2,782
|
$
140
|
$ 104,387
|
$ 90,554
|
Sales
|
1,733
|
2,164
|
3,110
|
5,167
|
541
|
119
|
29
|
1
|
5,413
|
7,451
|
Redemptions
|
(3,254)
|
(3,050)
|
(3,794)
|
(1,339)
|
(856)
|
(10)
|
(114)
|
(5)
|
(8,018)
|
(4,404)
|
Net sales
(redemptions)
|
(1,521)
|
(886)
|
(684)
|
3,828
|
(315)
|
109
|
(85)
|
(4)
|
(2,605)
|
3,047
|
Net
exchanges
|
3
|
15
|
0
|
(25)
|
(3)
|
0
|
0
|
0
|
0
|
(10)
|
Impact of foreign
exchange2
|
(285)
|
(247)
|
(63)
|
(33)
|
(450)
|
(312)
|
0
|
0
|
(798)
|
(592)
|
Market gains and
(losses)3
|
(1,779)
|
(977)
|
(568)
|
(115)
|
(161)
|
(133)
|
(98)
|
(7)
|
(2,606)
|
(1,232)
|
Ending
assets
|
$
40,801
|
$
36,514
|
$ 42,569
|
$ 47,196
|
$
12,409
|
$ 7,928
|
$ 2,599
|
$
129
|
$
98,378
|
$ 91,767
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months
Ended
|
|
Sept. 30,
2023
|
|
Equity
|
Fixed
Income
|
Alternative /
Private
Markets
|
Multi-asset
|
Total
|
|
Funds
|
Separate
Accounts1
|
Funds
|
Separate
Accounts1
|
Funds
|
Separate
Accounts1
|
Funds
|
Separate
Accounts1
|
Funds
|
Separate
Accounts1
|
Beginning
assets
|
$
43,342
|
$
38,181
|
$ 43,180
|
$ 43,563
|
$
13,050
|
$ 7,752
|
$ 2,851
|
$
138
|
$ 102,423
|
$ 89,634
|
Sales
|
7,059
|
7,338
|
11,201
|
8,014
|
1,824
|
744
|
108
|
2
|
20,192
|
16,098
|
Redemptions
|
(9,798)
|
(6,939)
|
(12,082)
|
(5,141)
|
(2,154)
|
(249)
|
(391)
|
(15)
|
(24,425)
|
(12,344)
|
Net sales
(redemptions)
|
(2,739)
|
399
|
(881)
|
2,873
|
(330)
|
495
|
(283)
|
(13)
|
(4,233)
|
3,754
|
Net
exchanges
|
85
|
41
|
(95)
|
(25)
|
17
|
(23)
|
3
|
0
|
10
|
(7)
|
Impact of foreign
exchange2
|
(69)
|
(284)
|
(4)
|
(11)
|
96
|
49
|
0
|
0
|
23
|
(246)
|
Market gains and
(losses)3
|
182
|
(1,823)
|
369
|
796
|
(424)
|
(345)
|
28
|
4
|
155
|
(1,368)
|
Ending
assets
|
$
40,801
|
$
36,514
|
$ 42,569
|
$ 47,196
|
$
12,409
|
$ 7,928
|
$ 2,599
|
$
129
|
$
98,378
|
$ 91,767
|
|
|
1)
|
Includes separately
managed accounts, institutional accounts, certain sub-advised funds
and other managed products. For certain accounts, Sales and
Redemptions are calculated as the remaining difference between
beginning and ending assets after the calculation of total
investment return.
|
2)
|
Reflects the impact of
translating non-U.S. dollar denominated AUM into U.S. dollars for
reporting purposes.
|
3)
|
Reflects the
approximate changes in the fair value of the securities held by
portfolios and, to a lesser extent, reinvested dividends,
distributions and net investment income.
|
Unaudited Changes
in Long-Term Assets - By Product Type
|
|
|
|
(in
millions)
|
Quarter
Ended
|
|
Nine Months
Ended
|
|
Sept. 30,
2023
|
June 30, 2023
|
Sept. 30, 2022
|
|
Sept. 30,
2023
|
Sept. 30, 2022
|
Total Fund
Assets
|
|
|
|
|
|
|
Beginning
assets
|
$
104,387
|
$
104,220
|
$
109,334
|
|
$
102,423
|
$
135,294
|
Sales
|
5,413
|
6,462
|
7,128
|
|
20,192
|
25,728
|
Redemptions
|
(8,018)
|
(7,916)
|
(10,056)
|
|
(24,425)
|
(36,153)
|
Net sales
(redemptions)
|
(2,605)
|
(1,454)
|
(2,928)
|
|
(4,233)
|
(10,425)
|
Net
exchanges
|
0
|
(5)
|
(5)
|
|
10
|
(53)
|
Impact of foreign
exchange1
|
(798)
|
487
|
(1,841)
|
|
23
|
(4,434)
|
Market gains and
(losses)2
|
(2,606)
|
1,139
|
(3,567)
|
|
155
|
(19,389)
|
Ending
assets
|
$
98,378
|
$
104,387
|
$
100,993
|
|
$
98,378
|
$
100,993
|
|
|
|
|
|
|
|
Total Separate
Account Assets3
|
|
|
|
|
|
|
Beginning
assets
|
$
90,554
|
$
91,017
|
$
82,827
|
|
$
89,634
|
$
85,672
|
Sales4
|
7,451
|
3,974
|
6,686
|
|
16,098
|
17,965
|
Redemptions4
|
(4,404)
|
(3,632)
|
(2,540)
|
|
(12,344)
|
(11,335)
|
Net sales
(redemptions)4
|
3,047
|
342
|
4,146
|
|
3,754
|
6,630
|
Net
exchanges
|
(10)
|
13
|
0
|
|
(7)
|
(1)
|
Impact of foreign
exchange1
|
(592)
|
166
|
(1,215)
|
|
(246)
|
(2,796)
|
Market gains and
(losses)2
|
(1,232)
|
(984)
|
(3,618)
|
|
(1,368)
|
(7,365)
|
Ending
assets
|
$
91,767
|
$
90,554
|
$
82,140
|
|
$
91,767
|
$
82,140
|
|
|
|
|
|
|
|
Total Long-term
Assets3
|
|
|
|
|
|
|
Beginning
assets
|
$
194,941
|
$
195,237
|
$
192,161
|
|
$
192,057
|
$
220,966
|
Sales4
|
12,864
|
10,436
|
13,814
|
|
36,290
|
43,693
|
Redemptions4
|
(12,422)
|
(11,548)
|
(12,596)
|
|
(36,769)
|
(47,488)
|
Net sales
(redemptions)4
|
442
|
(1,112)
|
1,218
|
|
(479)
|
(3,795)
|
Net
exchanges
|
(10)
|
8
|
(5)
|
|
3
|
(54)
|
Impact of foreign
exchange1
|
(1,390)
|
653
|
(3,056)
|
|
(223)
|
(7,230)
|
Market gains and
(losses)2
|
(3,838)
|
155
|
(7,185)
|
|
(1,213)
|
(26,754)
|
Ending
assets
|
$
190,145
|
$
194,941
|
$
183,133
|
|
$
190,145
|
$
183,133
|
|
|
1)
|
Reflects the impact of
translating non-U.S. dollar denominated AUM into U.S. dollars for
reporting purposes.
|
2)
|
Reflects the
approximate changes in the fair value of the securities held by
portfolios and, to a lesser extent, reinvested dividends,
distributions and net investment income.
|
3)
|
Includes separately
managed accounts, institutional accounts, certain sub-advised funds
and other managed products.
|
4)
|
For certain accounts,
Sales and Redemptions are calculated as the remaining difference
between beginning and ending assets after the calculation of total
investment return.
|
Unaudited Managed
Assets
|
Quarter
Ended
|
(in
millions)
|
Sept. 30,
2023
|
June 30, 2023
|
March 31, 2023
|
Dec. 31, 2022
|
Sept. 30, 2022
|
By Asset
Class
|
|
|
|
|
|
Equity
|
$
77,315
|
$
82,992
|
$
83,629
|
$
81,523
|
$
74,684
|
Fixed-income
|
89,765
|
87,425
|
87,461
|
86,743
|
85,365
|
Alternative / private
markets
|
20,337
|
21,602
|
21,174
|
20,802
|
20,182
|
Multi-asset
|
2,728
|
2,922
|
2,973
|
2,989
|
2,902
|
Total long-term
assets
|
190,145
|
194,941
|
195,237
|
192,057
|
183,133
|
Money
market
|
525,085
|
509,017
|
505,800
|
476,844
|
441,294
|
Total Managed
Assets
|
$
715,230
|
$
703,958
|
$
701,037
|
$
668,901
|
$
624,427
|
|
|
|
|
|
|
By Product
Type
|
|
|
|
|
|
Funds:
|
|
|
|
|
|
Equity
|
$
40,801
|
$
44,383
|
$
44,732
|
$
43,342
|
$
40,633
|
Fixed-income
|
42,569
|
43,884
|
43,616
|
43,180
|
44,896
|
Alternative / private
markets
|
12,409
|
13,338
|
13,040
|
13,050
|
12,680
|
Multi-asset
|
2,599
|
2,782
|
2,832
|
2,851
|
2,784
|
Total long-term
assets
|
98,378
|
104,387
|
104,220
|
102,423
|
100,993
|
Money
market
|
384,896
|
364,014
|
357,346
|
335,937
|
309,859
|
Total Fund
Assets
|
$
483,274
|
$
468,401
|
$
461,566
|
$
438,360
|
$
410,852
|
Separate
Accounts:
|
|
|
|
|
|
Equity
|
$
36,514
|
$
38,609
|
$
38,897
|
$
38,181
|
$
34,051
|
Fixed-income
|
47,196
|
43,541
|
43,845
|
43,563
|
40,469
|
Alternative / private
markets
|
7,928
|
8,264
|
8,134
|
7,752
|
7,502
|
Multi-asset
|
129
|
140
|
141
|
138
|
118
|
Total long-term
assets
|
91,767
|
90,554
|
91,017
|
89,634
|
82,140
|
Money
market
|
140,189
|
145,003
|
148,454
|
140,907
|
131,435
|
Total Separate
Account Assets
|
$
231,956
|
$
235,557
|
$
239,471
|
$
230,541
|
$
213,575
|
Total Managed
Assets
|
$
715,230
|
$
703,958
|
$
701,037
|
$
668,901
|
$
624,427
|
Unaudited Average
Managed Assets
|
Quarter
Ended
|
(in
millions)
|
Sept. 30,
2023
|
June 30, 2023
|
March 31, 2023
|
Dec. 31, 2022
|
Sept. 30, 2022
|
By Asset
Class
|
|
|
|
|
|
Equity
|
$
82,203
|
$
83,025
|
$
84,155
|
$
79,544
|
$
81,809
|
Fixed-income
|
88,677
|
87,504
|
88,209
|
87,849
|
87,042
|
Alternative / private
markets
|
21,413
|
21,411
|
20,938
|
20,926
|
21,193
|
Multi-asset
|
2,861
|
2,929
|
3,012
|
2,988
|
3,144
|
Total long-term
assets
|
195,154
|
194,869
|
196,314
|
191,307
|
193,188
|
Money
market
|
516,046
|
510,418
|
483,083
|
442,334
|
438,601
|
Total Avg. Managed
Assets
|
$
711,200
|
$
705,287
|
$
679,397
|
$
633,641
|
$
631,789
|
|
|
|
|
|
|
By Product
Type
|
|
|
|
|
|
Funds:
|
|
|
|
|
|
Equity
|
$
43,687
|
$
44,218
|
$
45,055
|
$
43,131
|
$
45,135
|
Fixed-income
|
43,437
|
43,827
|
43,961
|
44,099
|
47,489
|
Alternative / private
markets
|
13,184
|
13,181
|
13,062
|
13,140
|
13,432
|
Multi-asset
|
2,724
|
2,787
|
2,869
|
2,855
|
3,012
|
Total long-term
assets
|
103,032
|
104,013
|
104,947
|
103,225
|
109,068
|
Money
market
|
373,088
|
362,608
|
333,358
|
309,232
|
301,940
|
Total Avg. Fund
Assets
|
$
476,120
|
$
466,621
|
$
438,305
|
$
412,457
|
$
411,008
|
Separate
Accounts:
|
|
|
|
|
|
Equity
|
$
38,516
|
$
38,807
|
$
39,100
|
$
36,413
|
$
36,674
|
Fixed-income
|
45,240
|
43,677
|
44,248
|
43,750
|
39,553
|
Alternative / private
markets
|
8,229
|
8,230
|
7,876
|
7,786
|
7,761
|
Multi-asset
|
137
|
142
|
143
|
133
|
132
|
Total long-term
assets
|
92,122
|
90,856
|
91,367
|
88,082
|
84,120
|
Money
market
|
142,958
|
147,810
|
149,725
|
133,102
|
136,661
|
Total Avg. Separate
Account Assets
|
$
235,080
|
$
238,666
|
$
241,092
|
$
221,184
|
$
220,781
|
Total Avg. Managed
Assets
|
$
711,200
|
$
705,287
|
$
679,397
|
$
633,641
|
$
631,789
|
Unaudited Average
Managed Assets
|
|
Nine Months
Ended
|
(in
millions)
|
|
Sept. 30,
2023
|
|
Sept. 30, 2022
|
By Asset
Class
|
|
|
|
|
Equity
|
|
$
83,128
|
|
$
86,543
|
Fixed-income
|
|
88,130
|
|
90,419
|
Alternative / private
markets
|
|
21,254
|
|
22,090
|
Multi-asset
|
|
2,934
|
|
3,368
|
Total long-term
assets
|
|
195,446
|
|
202,420
|
Money
market
|
|
503,182
|
|
429,878
|
Total Avg. Managed
Assets
|
|
$
698,628
|
|
$
632,298
|
|
|
|
|
|
By Product
Type
|
|
|
|
|
Funds:
|
|
|
|
|
Equity
|
|
$
44,320
|
|
$
48,353
|
Fixed-income
|
|
43,741
|
|
52,025
|
Alternative / private
markets
|
|
13,143
|
|
14,158
|
Multi-asset
|
|
2,794
|
|
3,222
|
Total long-term
assets
|
|
103,998
|
|
117,758
|
Money
market
|
|
356,351
|
|
289,577
|
Total Avg. Fund
Assets
|
|
$
460,349
|
|
$
407,335
|
Separate
Accounts:
|
|
|
|
|
Equity
|
|
$
38,808
|
|
$
38,190
|
Fixed-income
|
|
44,389
|
|
38,394
|
Alternative / private
markets
|
|
8,111
|
|
7,932
|
Multi-asset
|
|
140
|
|
146
|
Total long-term
assets
|
|
91,448
|
|
84,662
|
Money
market
|
|
146,831
|
|
140,301
|
Total Avg. Separate
Account Assets
|
|
$
238,279
|
|
$
224,963
|
Total Avg. Managed
Assets
|
|
$
698,628
|
|
$
632,298
|
View original
content:https://www.prnewswire.com/news-releases/federated-hermes-inc-reports-third-quarter-2023-earnings-301969363.html
SOURCE Federated Hermes, Inc.