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Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the Quarterly period ended September 30, 2024

Or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from ______ to ______

Commission file number 001-37387

 

ASSOCIATED CAPITAL GROUP, INC.

 

(Exact name of registrant as specified in its charter)

 

Delaware

 

47-3965991

(State or other jurisdiction of incorporation or organization)

 

(I.R.S. Employer Identification No.)

 

191 Mason Street, Greenwich, CT

 

06830

(Address of principal executive offices)

 

(Zip Code)

 

Registrant’s telephone number, including area code (203) 629-9595

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading Symbol

 

Name of each exchange on which registered

Class A Common Stock, par value $0.001 per share

 

AC

 

New York Stock Exchange

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days Yes ☒ No ☐.

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

 

Large accelerated filer ☐

Accelerated filer ☐

 

Non-accelerated filer ☒

Smaller reporting company ☒

 

 

Emerging growth company ☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

Indicate by check mark whether the registrant is a shell company (as defined in Exchange Act Rule 12b-2) Yes ☐ No ☒.

 

Indicate the number of shares outstanding of each of the Registrant’s classes of Common Stock, as of the latest practical date.

 

Class

 

Outstanding at November 1, 2024

Class A Common Stock, .001 par value

 

2,286,564

Class B Common Stock, .001 par value

 

18,950,571

 

As of November 1, 2024, 2,286,564 shares of class A common stock and 18,950,571 shares of class B common stock were outstanding. GGCP, Inc., a private company controlled by the Company’s Executive Chairman, held 77,165 shares of class A common stock and indirectly held 18,423,741 shares of class B common stock. Other executive officers and directors of GGCP, Inc. held 29,866 and 176,758 shares of class A and class B common stock, respectively. In addition, there are 301,595 Phantom Restricted Stock Awards outstanding as of September 30, 2024.

 

 
Table of Contents

 

 
 

ASSOCIATED CAPITAL GROUP, INC. AND SUBSIDIARIES

 

INDEX

 

 

 

Page
PART I. FINANCIAL INFORMATION  

 

 

 

Item 1.

Unaudited Condensed Consolidated Financial Statements:

  

 

Condensed Consolidated Statements of Financial Condition (Unaudited)

3
 

Condensed Consolidated Statements of Income (Unaudited)

4
 

Condensed Consolidated Statements of Equity and Redeemable Noncontrolling Interests (Unaudited)

5
 

Condensed Consolidated Statements of Cash Flows (Unaudited)

6
 

Notes to the Condensed Consolidated Financial Statements (Unaudited):

  
 

1. Organization

8
 

2. Revenue

9
 

3. Investments in Securities

9
 

4. Investment Partnerships and Other Entities

10
 

5. Fair Value

13
 

6. Income Taxes

15
 

7. Earnings per Share

15
 

8. Equity

15
 

9. Goodwill

17
 

10. Guarantees, Contingencies and Commitments

17
 

11. Subsequent Events

17
     

Item 2.

Management’s Discussion and Analysis ("MD&A") of Financial Condition and Results of Operations

18

 

 

 

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

23

 

 

 

Item 4.

Controls and Procedures

24

 

 

 

PART II.

OTHER INFORMATION *

 

 

 

 

Item 1.

Legal Proceedings

25

 

 

 
Item 1A. Risk Factors 26
     

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

25

 

 

 

Item 6.

Exhibits

26

 

 

 

 

Signature

28

 

*         Items other than those listed above have been omitted because they are not applicable.

 

 

 

2
Table of Contents

 

 

ASSOCIATED CAPITAL GROUP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

UNAUDITED

(Dollars in thousands, except per share data)

 

  

September 30,

  

December 31,

 
  

2024

  

2023

 

ASSETS

        

Cash and cash equivalents (includes U.S. Treasury Bills with maturities of 3 months or less)

 $260,868  $317,487 

Investments in U.S. Treasury Bills with maturities greater than 3 months

  115,829   89,155 

Investments in equity securities (includes GAMCO stock with a fair value of $56.4 million and $45.6 million, respectively)

  249,669   196,583 

Investments in affiliated registered investment companies

  140,355   126,751 

Investments in partnerships

  138,905   142,974 

Receivable from brokers

  26,985   16,005 

Receivable from brokers (cash held for real estate purchase)

  -   14,263 

Investment advisory fees receivable

  1,233   4,711 

Receivable from affiliates

  5,169   876 

Income taxes receivable, including deferred tax assets, net

  2,588   8,474 

Goodwill

  3,519   3,519 

Other assets

  32,033   22,999 

Total assets

 $977,153  $943,797 
         

LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY

        
         

Payable to brokers

 $7,865  $4,459 

Income taxes payable, including deferred tax liabilities, net

  989   - 

Compensation payable

  17,488   15,169 

Securities sold, not yet purchased

  7,376   5,918 

Accrued expenses and other liabilities

  2,288   5,173 

Dividend payable

  42,494   - 

Total liabilities

  78,500   30,719 
         

Redeemable noncontrolling interests

  5,836   6,103 
         

Commitments and contingencies (Note 10)

          
         

Equity:

        

Preferred stock, $0.001 par value; 10,000,000 shares authorized; none issued and outstanding

  -   - 

Class A Common Stock, $0.001 par value; 100,000,000 shares authorized; 6,641,601 shares issued; 2,296,995 and 2,587,036 shares outstanding, respectively

  6   6 

Class B Common Stock, $0.001 par value; 100,000,000 shares authorized; 19,196,792 shares issued; 18,950,571 outstanding, respectively

  19   19 

Additional paid-in capital

  999,047   999,047 

Retained earnings

  43,647   48,231 

Treasury stock, at cost (4,344,606 and 4,054,565 shares, respectively)

  (149,902)  (140,328)

Total equity

  892,817   906,975 

Total liabilities, redeemable noncontrolling interests and equity

 $977,153  $943,797 

 

As of September 30, 2024 and December 31, 2023, certain balances include amounts related to a consolidated variable interest entity (“VIE”) and voting interest entity (“VOE”). See Note 4.

 

See accompanying notes.

 

 

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ASSOCIATED CAPITAL GROUP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

UNAUDITED

(In thousands, except per share data)

 

  

Three Months Ended

  

Nine Months Ended

 
  

September 30,

  

September 30,

 
  

2024

  

2023

  

2024

  

2023

 

Revenues

                

Investment advisory and incentive fees

 $2,310  $2,098  $7,706  $6,789 

Other revenues

  105   102   315   258 

Total revenues

  2,415   2,200   8,021   7,047 

Expenses

                

Compensation

  4,215   4,078   11,977   11,437 

Management fee

  3,312   (12)  5,736   3,075 

Other operating expenses

  1,804   1,655   5,868   4,660 

Total expenses

  9,331   5,721   23,581   19,172 

Operating loss

  (6,916)  (3,521)  (15,560)  (12,125)

Other income/(expense)

                

Net gain/(loss) from investments

  26,173   (2,173)  42,808   21,635 

Interest and dividend income

  11,142   6,336   24,985   17,497 

Interest expense

  (76)  (134)  (228)  (388)

Shareholder-designated contribution

  -   (235)  (449)  (1,604)

Total other income, net

  37,239   3,794   67,116   37,140 

Income before income taxes

  30,323   273   51,556   25,015 

Income tax expense

  6,933   166   11,415   3,586 

Income before noncontrolling interests

  23,390   107   40,141   21,429 

Income attributable to noncontrolling interests

  148   123   93   320 

Net income/(loss) attributable to Associated Capital Group, Inc.'s shareholders

 $23,242  $(16) $40,048  $21,109 
                 

Net income/(loss) per share attributable to Associated Capital Group, Inc.'s shareholders:

                

Basic

 $1.09  $0.00  $1.87  $0.97 

Diluted

 $1.09  $0.00  $1.87  $0.97 
                 

Weighted average shares outstanding (in thousands):

                

Basic

  21,275   21,672   21,389   21,836 

Diluted

  21,275   21,672   21,389   21,836 
                 

Actual shares outstanding (in thousands)

  21,248   21,623   21,248   21,623 

 

See accompanying notes.

 

 

 

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ASSOCIATED CAPITAL GROUP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY AND REDEEMABLE NONCONTROLLING INTERESTS

UNAUDITED

(Dollars in thousands)

 

 

  Three Months Ended September 30, 2024 
          

Additional

          

Redeemable

 
  

Common

  

Retained

  

Paid-in

  

Treasury

  

Total

  

Noncontrolling

 
  

Stock

  

Earnings

  

Capital

  

Stock

  

Equity

  

Interests

 

Balance at June 30, 2024

 $25  $62,899  $999,047  $(146,492) $915,479  $5,688 

Net income/(loss)

  -   23,242   -   -   23,242   148 

Dividends declared ($2.00 per share)

  -   (42,494)  -   -   (42,494)  - 

Purchases of treasury stock

  -   -   -   (3,410)  (3,410)  - 

Balance at September 30, 2024

 $25  $43,647  $999,047  $(149,902) $892,817  $5,836 

 

 

  Three Months Ended September 30, 2023 
          

Additional

          

Redeemable

 
  

Common

  

Retained

  

Paid-in

  

Treasury

  

Total

  

Noncontrolling

 
  

Stock

  

Earnings

  

Capital

  

Stock

  

Equity

  

Interests

 

Balance at June 30, 2023

 $25  $34,063  $999,047  $(133,568) $899,567  $7,086 

Redemptions of noncontrolling interests

  -   -   -   -   -   (76)

Net income/(loss)

  -   (16)  -   -   (16)  123 

Purchases of treasury stock

  -   -   -   (3,815)  (3,815)  - 

Balance at September 30, 2023

 $25  $34,047  $999,047  $(137,383) $895,736  $7,133 

 

 

  Nine Months Ended September 30, 2024 
          

Additional

          

Redeemable

 
  

Common

  

Retained

  

Paid-in

  

Treasury

  

Total

  

Noncontrolling

 
  

Stock

  

Earnings

  

Capital

  

Stock

  

Equity

  

Interests

 

Balance at December 31, 2023

 $25  $48,231  $999,047  $(140,328) $906,975  $6,103 

Redemptions of noncontrolling interests

  -   -   -   -   -   (360)

Net income/(loss)

  -   40,048   -   -   40,048   93 

Dividends declared ($2.10 per share)

  -   (44,632)  -   -   (44,632)  - 

Purchases of treasury stock

  -   -   -   (9,574)  (9,574)  - 

Balance at September 30, 2024

 $25  $43,647  $999,047  $(149,902) $892,817  $5,836 

 

 

  Nine Months Ended September 30, 2023 
          

Additional

          

Redeemable

 
  

Common

  

Retained

  

Paid-in

  

Treasury

  

Total

  

Noncontrolling

 
  

Stock

  

Earnings

  

Capital

  

Stock

  

Equity

  

Interests

 

Balance at December 31, 2022

 $25  $15,126  $999,047  $(124,002) $890,196  $10,193 

Redemptions of noncontrolling interests

  -   -   -   -   -   (3,380)

Net income/(loss)

  -   21,109   -   -   21,109   320 

Dividends declared ($0.10 per share)

  -   (2,188)  -   -   (2,188)  - 

Purchases of treasury stock

  -   -   -   (13,381)  (13,381)  - 

Balance at September 30, 2023

 $25  $34,047  $999,047  $(137,383) $895,736  $7,133 

 

See accompanying notes.

 

 

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ASSOCIATED CAPITAL GROUP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

UNAUDITED

(Dollars in thousands)

 

 

  

Nine Months Ended

 
  

September 30,

 
  

2024

  

2023

 

Operating activities

        

Net income

 $40,141  $21,429 

Adjustments to reconcile net income to net cash (used in)/provided by operating activities:

        

Equity in net (gains)/losses from partnerships

  (8,624)  848 

Depreciation and amortization

  272   270 

Deferred income taxes

  9,037   (246)

Donated securities

  1,346   1,107 

Unrealized gains on securities

  (31,381)  (15,703)

Realized gains on sales of securities

  (4,792)  (4,108)

(Increase)/decrease in assets:

        

Investments in trading securities

  (54,118)  184,788 

Investments in partnerships:

        

Contributions to partnerships

  (9,700)  (2,390)

Distributions from partnerships

  22,394   9,166 

Receivable from affiliates

  (4,293)  2,172 

Receivable from brokers

  (976)  (1,877)

Investment advisory fees receivable

  3,478   2,536 

Income taxes receivable

  (2,682)  2,644 

Other assets

  (9,306)  65 

Increase/(decrease) in liabilities:

        

Payable to brokers

  3,406   (2,166)

Income taxes payable

  520   43 

Compensation payable

  2,319   (3,021)

Accrued expenses and other liabilities

  (2,885)  (742)

Total adjustments

  (85,985)  173,386 

Net cash (used in)/provided by operating activities

  (45,844)  194,815 
         

Investing activities

        

Purchases of securities

  (9,185)  (1,162)

Proceeds from sales of securities

  5,023   2,245 

Return of capital on securities

  1,200   1,247 

Net (used in)/provided by investing activities

 $(2,962) $2,330 

 

 

 

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ASSOCIATED CAPITAL GROUP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

UNAUDITED (continued)

(Dollars in thousands)

 

   

Nine Months Ended

  
   

September 30,

  
   

2024

    

2023

  

Financing activities

                

Dividends paid

   $ (2,138 )   $ (2,188 )

Purchases of treasury stock

     (9,574 )     (13,381 )

Redemptions of redeemable noncontrolling interests

     (360 )     (3,380 )

Net cash used in financing activities

     (12,072 )     (18,949 )

Net (decrease)/increase in cash, cash equivalents and restricted cash

     (60,878 )     178,196  

Cash, cash equivalents and restricted cash at beginning of period

     347,057       221,269  

Cash, cash equivalents and restricted cash at end of period

   $ 286,179     $ 399,465  
                 

Supplemental disclosures of cash flow information:

                

Cash paid for interest

   $ 228     $ 134  

Cash paid for taxes

   $ 4,509     $ 849  
                 

Reconciliation of Cash, cash equivalents and restricted cash at end of period:

                

Cash and cash equivalents

   $ 260,868     $ 381,253  

Cash held for real estate purchase included in receivable from brokers

     -       13,059  

Cash included in receivable from brokers

     12,443       -  

Restricted cash included in receivable from brokers

     12,868       5,153  

Cash, cash equivalents and restricted cash

   $ 286,179     $ 399,465  

 

 

Supplemental disclosure of non-cash activity:

 

-

On September 19, 2024, the Board of Directors declared a special cash dividend of $2.00 per share, payable on November 4, 2024, to Class A and Class B shareholders of record on October 21, 2024. The aggregate payment will be $42,494 thousand based on the shares outstanding as of the record date. The liability for this dividend is recorded within Dividend payable on our condensed consolidated statements of financial condition as of September 30, 2024.

 

See accompanying notes.
 

 

 

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ASSOCIATED CAPITAL GROUP, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2024

(UNAUDITED)

 

 

1.    Organization

 

Unless we have indicated otherwise, or the context otherwise requires, references in this report to “Associated Capital Group, Inc.”, "Associated Capital", “AC Group”, “the Company”, “AC”, “we”, “us” and “our” or similar terms are to Associated Capital Group, Inc., its predecessors and its subsidiaries.

 

We are a Delaware corporation that provides alternative investment management, and we derive investment income from proprietary investments of cash and other assets in our operating business.

 

Gabelli & Company Investment Advisors, Inc. (“GCIA”), a wholly-owned subsidiary of AC, and its wholly-owned subsidiary, Gabelli & Partners, LLC (“Gabelli & Partners”), collectively serve as general partners or investment managers to investment funds, including limited partnerships and offshore companies (collectively, “Investment Partnerships”) and separate accounts. We primarily manage assets across a range of risk and event arbitrage portfolios and in equity event-driven value strategies. The businesses earn management and incentive fees from their advisory activities. Management fees are largely based on a percentage of assets under management. Incentive fees are based on the percentage of the investment returns of certain clients’ portfolios. GCIA is an investment adviser registered with the Securities and Exchange Commission under the Investment Advisers Act of 1940, as amended.

 

Basis of Presentation

 

The unaudited interim condensed consolidated financial statements of AC Group included herein have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by GAAP in the United States for complete financial statements. The unaudited interim condensed consolidated financial statements reflect all adjustments, which are of a normal recurring nature, necessary for a fair presentation of financial position, results of operations and cash flows of the Company for the interim periods presented and are not necessarily indicative of a full year’s results. These interim condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2023.

 

The interim condensed consolidated financial statements include the accounts of AC Group and its subsidiaries. All intercompany transactions and balances have been eliminated. The details on the impact of consolidating certain partnership entities on the condensed consolidated financial statements can be seen in Note 4. Investment Partnerships and Other Entities.

 

For the three and nine months ended September 30, 2024 and 2023, there were no items related to other comprehensive income.

 

Use of Estimates

 

The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported on the condensed consolidated financial statements and accompanying notes. Actual results could differ from those estimates.

 

Recent Accounting Developments

 

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The amendments require disclosure of specific categories in the rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold and further disaggregation of income taxes paid for individually significant jurisdictions. The ASU is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. We are currently evaluating the impact of this guidance on the disclosures within our consolidated financial statements.

 

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280), which improves reportable segment disclosure requirements. The new standard will require enhanced disclosures about a public company’s significant segment expenses and more timely and detailed segment information reporting throughout the fiscal period, including for companies with a single reportable segment. The standard is effective for annual periods beginning after December 15, 2023 and interim periods beginning after December 15, 2024, and early adoption is permitted. We are currently evaluating the impact of this guidance on the disclosures within our consolidated financial statements.

 

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2.    Revenue

 

The Company’s major revenue sources are as follows for the three and nine months ended September 30, 2024 and 2023 (in thousands):

 

  Three Months Ended September 30,  Nine Months Ended September 30, 
  

2024

  

2023

  

2024

  

2023

 

Investment advisory and incentive fees

                

Asset-based advisory fees

 $1,175  $1,265  $3,619  $3,871 

Performance-based advisory fees

  48   1   49   2 

Sub-advisory fees

  1,087   832   4,038   2,916 

Total investment advisory and incentive fees

  2,310   2,098   7,706   6,789 
                 

Other

  105   102   315   258 
                 

Total revenues

 $2,415  $2,200  $8,021  $7,047 

 
 

3.    Investments in Securities

 

Investments in securities at September 30, 2024 and December 31, 2023, consisted of the following (in thousands):

 

  

September 30, 2024

  

December 31, 2023

 
  

Cost

  

Fair Value

  

Cost

  

Fair Value

 

Debt - Trading Securities:

                

U.S. Treasury Bills

 $114,578  $115,829  $88,300  $89,155 

Equity Securities:

                

Common stocks

  229,350   244,874   198,269   191,346 

Mutual funds

  651   1,450   566   1,186 

Other investments

  4,164   3,345   5,166   4,051 

Total investments in equity securities

  234,165   249,669   204,001   196,583 

Total investments in securities

 $348,743  $365,498  $292,301  $285,738 

 

In September 2024, GAMCO Investors, Inc. declared a special cash dividend of $2 per share on their class A common stock and class B common stock. As of September 30, 2024, Receivable from affiliates on the condensed consolidated statements of financial condition included $4.6 million for dividends receivable based on the 2.3 million shares of GAMCO class A stock that we held on the declaration date.

 

Securities sold, not yet purchased at September 30, 2024 and December 31, 2023, consisted of the following (in thousands):

 

  

September 30, 2024

  

December 31, 2023

 
  

Cost

  

Fair Value

  

Cost

  

Fair Value

 
                 

Common stocks

 $6,604  $6,838  $5,227  $5,035 

Other investments

  114   538   631   883 

Total securities sold, not yet purchased

 $6,718  $7,376  $5,858  $5,918 

 

Investments in affiliated registered investment companies at September 30, 2024 and December 31, 2023, consisted of the following (in thousands):

 

  

September 30, 2024

  

December 31, 2023

 
  

Cost

  

Fair Value

  

Cost

  

Fair Value

 
                 

Closed-end funds

 $39,924  $57,898  $39,680  $53,048 

Mutual funds

  54,898   82,457   50,136   73,703 

Total investments in affiliated registered investment companies

 $94,822  $140,355  $89,816  $126,751 

 

 

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4.    Investment Partnerships and Other Entities

 

The Company is a general partner or co-general partner of various affiliated entities whose underlying assets consist primarily of marketable securities (“Affiliated Entities”). The Company had investments in Affiliated Entities totaling $99.1 million and $107.4 million at September 30, 2024 and December 31, 2023, respectively. The Company also had investments in unaffiliated partnerships, offshore funds and other entities of $39.8 million and $35.6 million at September 30, 2024, and December 31, 2023, respectively (“Unaffiliated Entities”). We evaluate each entity to determine its appropriate accounting treatment and disclosure. Certain of the Affiliated Entities, and none of the Unaffiliated Entities, are consolidated.

 

Investments in partnerships that are not required to be consolidated are accounted for using the equity method and are included in investments in partnerships on the condensed consolidated statements of financial condition. The Company reflects the equity in earnings of these Affiliated Entities and Unaffiliated Entities in net gain/(loss) from investments on the condensed consolidated statements of income.

 

Capital may generally be redeemed from Affiliated Entities on a monthly basis upon adequate notice as determined in the sole discretion of each entity’s investment manager. Capital invested in Unaffiliated Entities may generally be redeemed at various intervals ranging from monthly to annually upon notice of 30 to 95 days. Certain Unaffiliated Entities and Affiliated Entities may require a minimum investment period before capital can be voluntarily redeemed (a “Lockup Period”). No investment in any Investment Partnership has an unexpired Lockup Period. The Company has no material outstanding capital commitments to any Affiliated or Unaffiliated Entity.

 

Consolidated Entities

 

The following table reflects the net impact of the consolidated investment partnerships (“Consolidated Entities”) on the condensed consolidated statements of financial condition (in thousands):

 

  

September 30, 2024

 
  

Prior to

  

Consolidated

     

Assets

 

Consolidation

  

Entities

  

As Reported

 

Cash and cash equivalents

 $258,195  $2,673  $260,868 

Investments in U.S. Treasury Bills

  113,338   2,491   115,829 

Investments in equity securities

  183,191   66,478   249,669 

Investments in affiliated registered investment companies

  195,119   (54,764)  140,355 

Investments in partnerships

  159,717   (20,812)  138,905 

Receivable from brokers

  17,556   9,429   26,985 

Investment advisory fees receivable

  1,240   (7)  1,233 

Other assets(1)

  40,645   2,664   43,309 

Total assets

 $969,001  $8,152  $977,153 

Liabilities, redeemable noncontrolling interests and equity

            

Securities sold, not yet purchased

 $6,903  $473  $7,376 

Payable to brokers and other liabilities(1)

  26,787   1,843   28,630 

Dividends payable

  42,494   -   42,494 

Redeemable noncontrolling interests

  -   5,836   5,836 

Total equity

  892,817   -   892,817 

Total liabilities, redeemable noncontrolling interests and equity

 $969,001  $8,152  $977,153 

 

 

 

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December 31, 2023

 
  

Prior to

  

Consolidated

     

Assets

 Consolidation  Entities  As Reported 

Cash and cash equivalents

 $299,508  $17,979  $317,487 

Investments in U.S. Treasury Bills

  79,714   9,441   89,155 

Investments in equity securities

  149,154   47,429   196,583 

Investments in affiliated registered investment companies

  181,641   (54,890)  126,751 

Investments in partnerships

  163,226   (20,252)  142,974 

Receivable from brokers(1)

  25,026   5,242   30,268 

Investment advisory fees receivable

  4,714   (3)  4,711 

Other assets(1)

  33,444   2,424   35,868 

Total assets

 $936,427  $7,370  $943,797 

Liabilities, redeemable noncontrolling interests and equity

            

Securities sold, not yet purchased

 $5,639  $279  $5,918 

Payable to brokers and other liabilities(1)

  23,813   988   24,801 

Redeemable noncontrolling interests

  -   6,103   6,103 

Total equity

  906,975   -   906,975 

Total liabilities, redeemable noncontrolling interests and equity

 $936,427  $7,370  $943,797 

 

(1) Represents the summation of multiple assets and liabilities from the condensed consolidated statements of financial condition.

 

The following table reflects the net impact of the Consolidated Entities on the condensed consolidated statements of income (in thousands):

 

  Three Months Ended September 30, 2024 
  

Prior to

  

Consolidated

     
  

Consolidation

  

Entities

  

As Reported

 

Total revenues

 $2,527  $(112) $2,415 

Operating loss

  (6,545)  (371)  (6,916)

Total other income, net

  36,353   886   37,239 

Income before noncontrolling interests

  23,242   148   23,390 

Income attributable to noncontrolling interests

  -   148   148 

Net income/(loss)

 $23,242  $-  $23,242 

 

  Three Months Ended September 30, 2023 
  

Prior to

  

Consolidated

     
  

Consolidation

  

Entities

  

As Reported

 

Total revenues

 $2,310  $(110) $2,200 

Operating loss

  (3,156)  (365)  (3,521)

Total other income, net

  3,044   750   3,794 

Income/(loss) before noncontrolling interests

  (16)  123   107 

Income attributable to noncontrolling interests

  -   123   123 

Net income/(loss)

 $(16) $-  $(16)

 

 

  Nine Months Ended September 30, 2024 
  

Prior to

  

Consolidated

     
  

Consolidation

  

Entities

  

As Reported

 

Total revenues

 $8,349  $(328) $8,021 

Operating loss

  (14,423)  (1,137)  (15,560)

Total other income, net

  66,050   1,066   67,116 

Income before noncontrolling interests

  40,048   93   40,141 

Income attributable to noncontrolling interests

  -   93   93 

Net income/(loss)

 $40,048  $-  $40,048 

 

 

 

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  Nine Months Ended September 30, 2023 
  

Prior to

  

Consolidated

     
  

Consolidation

  

Entities

  

As Reported

 

Total revenues

 $7,378  $(331) $7,047 

Operating loss

  (10,998)  (1,127)  (12,125)

Total other income/(loss), net

  38,670   (1,530)  37,140 

Income before noncontrolling interests

  21,109   320   21,429 

Income attributable to noncontrolling interests

  -   320   320 

Net income/(loss)

 $21,109  $-  $21,109 

 

Variable Interest Entity

 

We have one investment partnership that is consolidated as a VIE as of September 30, 2024 and December 31, 2023 because AC is the primary beneficiary of the entity. With respect to the consolidated VIE, its assets may only be used to satisfy its obligations. The investors and creditors of the consolidated VIE have no recourse to the Company’s general assets. In addition, the Company neither benefits from such VIE’s assets nor bears the related risk beyond its beneficial interest in the VIE.

 

The following table presents the balances related to the VIE that is consolidated and included on the condensed consolidated statements of financial condition as well as the Company’s net interest in that VIE (in thousands):

 

  

September 30, 2024

  

December 31, 2023

 

Cash and cash equivalents

 $285  $302 

Investments in equity securities

  10,458   9,695 

Receivable from brokers

  22   166 

Accrued expenses and other liabilities

  (35)  (46)

Redeemable noncontrolling interests

  (472)  (451)

AC Group's net interest in consolidated VIE

 $10,258  $9,666 

 

 

Voting Interest Entity

 

We have one investment partnership that is consolidated as a VOE as of September 30, 2024 and December 31, 2023 because AC has a controlling interest in the entity. This resulted in the consolidation of $73.0 million of assets, $2.5 million of liabilities, and $5.4 million of redeemable noncontrolling interests at September 30, 2024 and $72.4 million of assets, $1.4 million of liabilities, and $5.6 million of redeemable noncontrolling interests at December 31, 2023. AC’s net interest in the consolidated VOE at September 30, 2024 and December 31, 2023 was $65.1 million and $65.4 million, respectively.  

 

Equity Method Investments

 

The Company’s equity method investments include investments in domestic partnerships and offshore funds. The Company evaluates each of its equity method investments to determine if any are significant as defined in the regulations applicable to smaller reporting companies promulgated by the SEC. As of and for the three and nine months ended September 30, 2024, no individual equity method investment held by the Company met the significance criteria. As such, the Company is not required to present summarized income statement information for any of its equity method investments. 

 

 

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5.    Fair Value

 

Accounting Standards Codification Topic 820, Fair Value Measurement (ASC 820) specifies a hierarchy of valuation classifications based on whether the inputs to the valuation techniques used in each valuation classification are observable or unobservable. These classifications are summarized in the three broad levels listed below:

 

 

•

Level 1 - Unadjusted quoted prices for identical instruments in active markets.

 

•

Level 2 - Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable.

 

•

Level 3 - Valuations derived from valuation techniques in which significant inputs or significant value drivers are unobservable.

 

Inputs used to measure fair value might fall in different levels of the fair value hierarchy, in which case the Company defaults to the lowest level input that is significant to the fair value measurement in its entirety. These levels are not necessarily an indication of the risk or liquidity associated with the investments.

 

The following tables present assets and liabilities measured at fair value on a recurring basis, unless otherwise noted, as of the dates specified (in thousands):

 

  

September 30, 2024

 

Assets

 

Level 1

  

Level 2

  

Level 3

  

Total

 

Cash equivalents

 $259,247  $-  $-  $259,247 

Investments in securities (including GAMCO stock):

                

Trading - U.S. Treasury Bills

  115,829   -   -   115,829 

Common stocks

  242,017   822   2,035   244,874 

Mutual funds

  1,450   -   -   1,450 

Other

  2,571   648   126   3,345 

Total investments in securities

  361,867   1,470   2,161   365,498 

Investments in affiliated registered investment companies:

                

Closed-end funds - equity securities

  48,042   -   -   48,042 

Preferred securities issued by Closed-end funds (a)

  -   -   9,856   9,856 

Mutual funds

  82,457   -   -   82,457 

Total investments in affiliated registered investment companies

  130,499   -   9,856   140,355 

Total investments held at fair value

  492,366   1,470   12,017   505,853 

Total assets at fair value

 $751,613  $1,470  $12,017  $765,100 

Liabilities

                

Common stocks

 $6,838  $-  $-  $6,838 

Other

  35   503   -   538 

Securities sold, not yet purchased

  6,873   503   -   7,376 

Total liabilities at fair value

 $6,873  $503  $-  $7,376 

 

(a) These securities represent privately issued, puttable and callable preferred securities issued by affiliated closed-end funds.

 

 

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December 31, 2023

 

Assets

 

Level 1

  

Level 2

  

Level 3

  

Total

 

Cash equivalents

 $315,017  $-  $-  $315,017 

Investments in securities (including GAMCO stock):

                

Trading - U.S. Treasury Bills

  89,155   -   -   89,155 

Common stocks

  187,963   1,348   2,035   191,346 

Mutual funds

  1,186   -   -   1,186 

Other

  3,347   485   219   4,051 

Total investments in securities

  281,651   1,833   2,254   285,738 

Investments in affiliated registered investment companies:

                

Closed-end funds - equity securities

  44,692   -   -   44,692 

Preferred securities issued by Closed-end funds (a)

  -   -   8,356   8,356 

Mutual funds

  73,703   -   -   73,703 

Total investments in affiliated registered investment companies

  118,395   -   8,356   126,751 

Total investments held at fair value

  400,046   1,833   10,610   412,489 

Total assets at fair value

 $715,063  $1,833  $10,610  $727,506 

Liabilities

                

Common stocks

 $5,035  $-  $-  $5,035 

Other

  579   304   -   883 

Securities sold, not yet purchased

  5,614   304   -   5,918 

Total liabilities at fair value

 $5,614  $304  $-  $5,918 

 

(a) These securities represent privately issued, puttable and callable preferred securities issued by affiliated closed-end funds.

 

The following table presents additional information about assets measured at fair value on a recurring basis and for which the Company has utilized Level 3 inputs to determine fair value:

 

  

Three Months Ended

  

Nine Months Ended

 
  

September 30,

  

September 30,

 

Assets:

 

2024

  

2023

  

2024

  

2023

 

Beginning balance

 $12,017  $14,491  $10,610  $13,774 

Total gains/(losses)

  -   (1)  100   (34)

Purchases

  -   -   3,900   1,000 

Sales/return of capital

  -   (880)  (2,593)  (1,130)

Ending balance

 $12,017  $13,610  $12,017  $13,610 

Changes in net unrealized gain/(loss) included in Net gain/(loss) from investments related to level 3 assets still held as of the reporting date

 $-  $(1) $100  $(34)

 

Total realized and unrealized gains and losses for Level 3 assets are reported in net gain/(loss) from investments in the condensed consolidated statements of income.

 

During the three and nine months ended September 30, 2024 and 2023, there were no transfers into or out of Level 3. 

 

The Company uses a discounted cash flow analysis when determining the fair value of privately issued preferred securities of affiliated closed-end funds that are categorized as Level 3. Projected cash flows in the discounted cash flow analysis represent the relevant security’s dividend rate plus the assumption of full principal repayment at the preferred security’s earliest available redemption date.

 

The significant unobservable input used in the fair value measurement of each of the Company’s investments in privately issued preferred securities of closed-end funds is the discount rate. The discount rate was determined using the interest rates of U.S. Treasury Bills that are held over a similar period as the preferred security. The discount rates used in the valuation of these investments as of September 30, 2024 ranged from 3.57% to 4.63% with a weighted average of 4.37% calculated based on the relative fair value. Significant changes in the discount rate could result in a significantly higher or lower fair value measurement of these Level 3 investments.

 

The Company uses the market approach as the valuation technique to value its investment in common stocks classified as Level 3, specifically considering recent transactions.

 

 

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6.    Income Taxes

 

The effective tax rate (“ETR”) for the nine months ended September 30, 2024 and  September 30, 2023 was 22.1% and 14.3%, respectively. The ETR in the year to date periods of 2024 and 2023 differ from the U.S. corporate tax rate of 21% primarily due to (a) deferred tax benefits from a foreign investment, (b) state and local taxes (net of federal benefit) and (c) the deductibility of officers' compensation. The increase in the ETR for the nine months ended September 30, 2024 was primarily due to deferred tax benefits from a foreign investment which reduced the prior year's rate.

 
 

7.    Earnings per Share

 

Basic earnings per share is computed by dividing net income/(loss) attributable to our shareholders by the weighted average number of shares outstanding during the period. Diluted earnings per share is computed by dividing net income/(loss) attributable to our shareholders by the weighted average number of shares, plus any potentially dilutive securities (if any), outstanding during the period.

 

The computations of basic and diluted EPS are as follows (in thousands, except per share amounts):

 

  

Three Months Ended

  

Nine Months Ended

 
  

September 30,

  

September 30,

 
  

2024

  

2023

  

2024

  

2023

 

Net income/(loss) attributable to Associated Capital's shareholders

 $23,242  $(16) $40,048  $21,109 
                 

Weighted average number of shares outstanding - basic and diluted

  21,275   21,672   21,389   21,836 
                 

Basic and Diluted EPS

 $1.09  $0.00  $1.87  $0.97 

 
 

8.    Equity

 

Voting Rights

 

The holders of Class A Common stock (“Class A Stock”) and Class B Common stock (“Class B Stock”) have identical rights except that holders of Class A Stock are entitled to one vote per share, while holders of Class B Stock are entitled to ten votes per share on all matters to be voted on by shareholders in general. Holders of each share class, however, are not eligible to vote on matters relating exclusively to the other share class.

 

Stock Award and Incentive Plan

 

The Company’s Board of Directors periodically grants shares of Phantom Restricted Stock awards (“Phantom RSAs”). Under the terms of the grants, the Phantom RSAs vest 30% and 70% after three and five years, respectively. The Phantom RSAs will be settled by a cash payment, net of applicable withholding tax, on the vesting dates. In addition, an amount equivalent to the cumulative dividends declared on shares of the Company’s Class A Stock during the vesting period will be paid to participants on vesting.

 

 

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The Phantom RSAs are treated as a liability because cash settlement is required and compensation will be recognized over the vesting period. In determining the compensation expense to be recognized each period, the Company will re-measure the fair value of the liability at each reporting date taking into account the remaining vesting period attributable to each award and the current market value of the Company’s Class A Stock. In making these determinations, the Company will consider the impact of Phantom RSAs that have been forfeited prior to vesting (e.g., due to an employee termination). The Company has elected to consider forfeitures as they occur.

 

Based on the closing price of the Company’s Class A Stock on September 30, 2024 and December 31, 2023, the total liability recorded by the Company in compensation payable in our condensed consolidated statements of financial condition as of September 30, 2024 and December 31, 2023, with respect to the Phantom RSAs was $4.0 million and $3.5 million, respectively.

 

The following table summarizes our stock-based compensation as well as unrecognized compensation for the three and nine month periods ended  September 30, 2024 and 2023, respectively. Stock-based compensation expense is included in compensation expense in the condensed consolidated statements of income (dollars in thousands, unless otherwise noted):

 

  

Three Months Ended

  

Nine Months Ended

 
  

September 30,

  

September 30,

 
  

2024

  

2023

  

2024

  

2023

 
                 

Stock-based compensation expense

 $734  $752  $1,491  $957 
                 

Remaining expense to be recognized, if all vesting conditions are met(1)

          6,751   5,607 
                 

Weighted average remaining contractual term (in years)

          2.1   2.1 

 

(1) Does not include an estimate for projected future dividends.

 

The following table summarizes Phantom RSA ("PRSA") activity:

 

  

PRSAs

  Weighted Average Grant Date Fair Value 

Balance at December 31, 2023

  233,695  $37.38 

Granted

  -   - 

Forfeited

  -   - 

Vested

  -   - 

Balance at March 31, 2024

  233,695  $37.38 

Granted

  97,200   34.28 

Forfeited

  -   - 

Vested

  (27,300)  35.82 

Balance at June 30, 2024

  303,595  $36.53 

Granted

  -   - 

Forfeited

  (2,000)  36.95 

Vested

  -   - 

Balance at September 30, 2024

  301,595  $36.53 

 

Stock Repurchase Program

 

In December 2015, the Board of Directors established a stock repurchase program ("Stock Repurchase Program") authorizing the Company to repurchase up to 500,000 shares of Class A Stock. On February 7, 2017, the Board of Directors reset the available number of shares to be purchased under the stock repurchase program to 500,000 shares. On August 3, 2017 and May 8, 2018, the Board of Directors authorized the repurchase of an additional 1 million and 500,000 shares, respectively. On February 6, 2024, the Board of Directors authorized the repurchase of an additional 350,000 shares. On August 7, 2024, the Board of Directors authorized the repurchase of an additional 200,000 shares. Our stock repurchase program is not subject to an expiration date.

 

 

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The following table presents the Company's repurchase activity with respect to its Class A Stock and remaining authorization:

 

 

For the three months ended September 30, 2024

 

Number of shares purchased

  

Average price per share

 

Remaining repurchase authorization June 30, 2024

  323,841     

Share repurchases under stock repurchase program (1)

  (107,218) $31.80 

Remaining repurchase authorization September 30, 2024 (2)

  416,623     

For the nine months ended September 30, 2024:

        

Remaining repurchase authorization December 31, 2023

  156,664     

Share repurchases under stock repurchase program (1)

  (290,041) $33.01 

Remaining repurchase authorization September 30, 2024 (2)

  416,623     

For the three months ended September 30, 2023:

        

Remaining repurchase authorization June 30, 2023

  345,175     

Share repurchases under stock repurchase program (1)

  (103,169) $36.98 

Remaining repurchase authorization September 30, 2023

  242,006     

For the nine months ended September 30, 2023:

        

Remaining repurchase authorization December 31, 2022

  609,352     

Share repurchases under stock repurchase program (1)

  (367,346) $36.43 

Remaining repurchase authorization September 30, 2023

  242,006     

 

(1) Repurchases totaled $3.4 million and $3.8 million for the three-months ended September 30, 2024 and 2023, respectively. Repurchases totaled $9.6 and $13.4 million for the nine months ended September 30, 2024 and 2023, respectively. 

(2) On February 6, 2024, the Board of Directors authorized the repurchase of an additional 350,000 shares. On August 7, 2024, the Board of Directors authorized the repurchase of an additional 200,000 shares.

 

Dividends

 

During the three and nine months ended September 30, 2024, the Company declared dividends of $2.00 per share and $2.10 per share, respectively, to Class A and Class B shareholders totaling $42.5 million and $44.6 million, respectively. The Company declared no dividends during the three month period ended September 30, 2023. For the nine months ended September 30, 2023, the Company declared dividends of $0.10 per share to Class A and Class B shareholders totaling $2.2 million.
 

9.    Goodwill

 

At September 30, 2024 and December 31, 2023, goodwill on the condensed consolidated statements of financial condition includes $3.4 million of goodwill related to GCIA. The Company assesses the recoverability of goodwill at least annually, or more often should events warrant, using a qualitative assessment of whether it is more likely than not that an impairment has occurred to determine if a quantitative analysis is required. There were no indicators of impairment for the three and nine months ended September 30, 2024 or 2023, and as such there was no impairment analysis performed or charge recorded.
 

10.    Guarantees, Contingencies and Commitments

 

From time to time, the Company may be named in legal actions and proceedings. These actions may seek substantial or indeterminate compensatory as well as punitive damages or injunctive relief. We are also subject to governmental or regulatory examinations or investigations. The examinations or investigations could result in adverse judgments, settlements, fines, injunctions, restitutions or other relief. For any such matters, the condensed consolidated financial statements include the necessary provisions for losses, if any, that the Company believes are probable and estimable. Furthermore, the Company evaluates whether losses exist which may be reasonably possible and will, if material, make the necessary disclosures. Management is not aware of any probable or reasonably possible losses.

 

The Company has also entered into arrangements with various other third parties, many of which provide for indemnification of the third parties against losses, costs, claims and liabilities arising from the performance of obligations under the agreements. The Company has had no claims or payments pursuant to these or prior agreements and believes the likelihood of a claim being made is remote, and, therefore, no accrual has been made on the condensed consolidated financial statements.
 

11.    Subsequent Events

 

From October 1, 2024 to November 13, 2024, the Company repurchased 14,625 shares at an average price of $36.17 per share.

 

On November 8, 2024, the Board of Directors declared a dividend of $0.10 per share, which is payable on December 19, 2024 to Class A and Class B shareholders of record on December 5, 2024. 

 

 

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ITEM 2:    MANAGEMENT’S DISCUSSION AND ANALYSIS (“MD&A”) OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

Introduction

 

MD&A is provided as a supplement to, and should be read in conjunction with, the Company’s unaudited interim consolidated financial statements and accompanying notes thereto included in this Quarterly Report on Form 10-Q, as well as the Company’s audited annual financial statements included in our Form 10-K filed with the SEC on March 21, 2024 to help provide an understanding of our financial condition, changes in financial condition and results of operations. Unless the context otherwise requires, all references to “we,” “us,” “our,” “AC Group” or the “Company” refer collectively to Associated Capital Group, Inc., a holding company, and its subsidiaries through which our operations are actually conducted.

 

Overview

 

We are a Delaware corporation, incorporated in 2015, that provides alternative investment management services and operates a direct investment business that over time invests in businesses that fit our criteria. Additionally, we derive income from proprietary investments.

 

Alternative Investment Management

 

We conduct our investment management activities through our wholly-owned subsidiary Gabelli & Company Investment Advisers, Inc. (“GCIA”) and its wholly-owned subsidiary, Gabelli & Partners, LLC (“Gabelli & Partners”). GCIA is an investment adviser registered with the Securities and Exchange Commission (“SEC”) under the Investment Advisers Act of 1940, as amended (the “Advisers Act”). GCIA and Gabelli & Partners together serve as general partners or investment managers to investment funds, including limited partnerships and offshore companies (collectively, “Investment Partnerships”) and separate accounts. We primarily manage assets across a range of risk and event arbitrage portfolios and in equity event-driven value strategies. The business earns management and incentive fees from its advisory activities. Management fees are largely based on a percentage of assets under management (“AUM”). Incentive fees are based on a percentage of the investment returns of certain client portfolios.

 

We manage assets on a discretionary basis and invest in a variety of U.S. and foreign securities mainly in the developed global markets. We primarily employ absolute return strategies with the objective of generating positive returns. We serve a wide variety of investors globally including private wealth management clients, corporations, corporate pension and profit-sharing plans, foundations and endowments.

 

In merger arbitrage, the goal is to earn absolute positive returns. We introduced our first limited partnership, Gabelli Arbitrage (renamed Gabelli Associates Fund), in February 1985. Our typical investment process begins at the time of deal announcement, buying shares of the target at a discount to the stated deal terms, earning the spread until the deal closes, and reinvesting the proceeds in new deals in a similar manner. By owning a diversified portfolio of transactions, we mitigate the adverse impact of single deal-specific risks.

 

As the business and investor base expanded, we launched an offshore version in 1989. Building on our strengths in global event-driven value investing, several investment vehicles have been added to balance investors’ geographic, strategic and sector-specific needs. Today, we manage investments in multiple categories, including merger arbitrage, long/short value and other strategies.

 

Proprietary Capital

 

Proprietary capital is earmarked for our direct investment business that invests in new and existing businesses, using a variety of techniques and structures. We launched our direct private equity and merchant banking activities in August 2017. The direct investment business is developing along several core pillars:

 

●

Gabelli Private Equity Partners, LLC (“GPEP”), formed in August 2017 with $150 million of authorized capital as a “fundless” sponsor.
 

●

Gabelli Principal Strategies Group, LLC (“GPS”) was created in December 2015 to pursue strategic operating initiatives broadly.

 

Our direct investing efforts are organized to invest in various ways, including growth capital, leveraged buyouts and restructurings, with an emphasis on small and mid-sized companies. Our investment sourcing is across a variety of channels including direct owners, private equity funds, classic agents, and corporate carve outs (which are positioned for accelerated growth, as businesses seek to enhance shareholder value through financial engineering). The Company’s direct investing vehicles allow us to acquire companies and create long-term value with no pre-determined exit timetable. 

 

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We have a proprietary portfolio of cash and investments which we expect to use to invest primarily in funds that we will manage, provide seed capital for new products, expand our geographic presence, develop new markets and pursue strategic acquisitions and alliances.

 

Financial Highlights

 

The following is a summary of the Company’s financial performance for the quarters ended September 30, 2024 and 2023:

 

($000s except per share data or as noted)

 

   

Third Quarter

  
   

2024

    

2023

  

AUM - end of period (in millions)

   $ 1,340     $ 1,588  

AUM - average (in millions)

   $ 1,349     $ 1,580  

Net income/(loss) per share-diluted

   $ 1.09     $ 0.00  

Book value per share at September 30

   $ 42.02     $ 41.43  

 

Condensed Consolidated Statements of Income

 

Investment advisory and incentive fees, which are based on the amount and composition of AUM in our funds and accounts, represent our largest source of revenues. Growth in revenues depends on good investment performance, which influences the value of existing AUM as well as contributes to higher investment and lower redemption rates and attracts additional investors while maintaining current fee levels. Growth in AUM is also dependent on being able to access various distribution channels, which is usually based on several factors, including performance and service. In light of the ongoing dynamics created by the conflicts in the Middle East and the Ukraine and their impact on the global economy and markets, we could experience higher volatility in the short-term returns of our funds.

 

Incentive fees generally consist of an incentive allocation on the absolute gain in a portfolio generally equating to 20% of the economic profit, as defined in the agreements governing the investment vehicle or account. We recognize such revenue only when the measurement period has been completed, generally in December or at the time of an investor redemption.

 

Compensation includes variable and fixed compensation and related expenses paid to officers, portfolio managers, sales, trading, research and all other professional staff. Variable compensation is paid to sales personnel and portfolio management and may represent up to 55% of revenues.

 

Management fee expense is incentive-based compensation equal to 10% of adjusted aggregate pre-tax profits paid to the Executive Chair or his designees for his services pursuant to an employment agreement.

 

Other operating expenses include general and administrative operating costs.

 

Other income and expense includes net gains and losses from investments (which include both realized and unrealized gains and losses from securities and equity in earnings of investments in partnerships), interest and dividend income, and interest expense. Net gains and losses from investments are derived from our proprietary investment portfolio consisting of various public and private investments and from consolidated investment funds.

 

Net income attributable to noncontrolling interests represents the share of net income attributable to third-party limited partners of certain partnerships and offshore funds we consolidate. Please refer to Notes 1 and 4 in our condensed consolidated financial statements included elsewhere in this report.

 

Condensed Consolidated Statements of Financial Condition

 

We ended the third quarter of 2024 with approximately $898.3 million in cash and investments, net of securities sold, not yet purchased of $7.4 million. This includes $260.9 million of cash and cash equivalents; $115.8 million of U.S. Treasury obligations; $242.3 million of securities, net of securities sold, not yet purchased, including shares of GAMCO Investors, Inc. ("GAMCO") with a market value of $56.4 million; and $279.3 million invested in affiliated and third-party funds and partnerships, including investments in affiliated closed end funds which have a value of $55.0 million and more limited liquidity. Our financial resources provide flexibility to pursue strategic objectives that may include acquisitions, lift-outs, seeding new investment strategies, and co-investing, as well as shareholder compensation in the form of share repurchases and dividends.

 

Total shareholders’ equity was $892.8 million or $42.02 per share as of September 30, 2024, compared to $907.0 million or $42.11 per share as of December 31, 2023. Shareholders’ equity per share is calculated by dividing the total equity by the number of common shares outstanding. The decrease in equity from the end of 2023 was largely attributable to the special $2 per share dividend declared in September 2024.

 

 

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RESULTS OF OPERATIONS

 

   

Three Months Ended

    

Nine Months Ended

  
   

September 30,

    

September 30,

  
   

2024

    

2023

    

2024

    

2023

  

Revenues

                                

Investment advisory and incentive fees

   $ 2,310     $ 2,098     $ 7,706     $ 6,789  

Other revenues

     105       102       315       258  

Total revenues

     2,415       2,200       8,021       7,047  

Expenses

                                

Compensation

     4,215       4,078       11,977       11,437  

Management fee

     3,312       (12 )     5,736       3,075  

Other operating expenses

     1,804       1,655       5,868       4,660  

Total expenses

     9,331       5,721       23,581       19,172  

Operating loss

     (6,916 )     (3,521 )     (15,560 )     (12,125 )

Other income

                                

Net gain/(loss) from investments

     26,173       (2,173 )     42,808       21,635  

Interest and dividend income

     11,142       6,336       24,985       17,497  

Interest expense

     (76 )     (134 )     (228 )     (388 )

Shareholder-designated contribution

     -       (235 )     (449 )     (1,604 )

Total other income, net

     37,239       3,794       67,116       37,140  

Income before income taxes

     30,323       273       51,556       25,015  

Income tax expense

     6,933       166       11,415       3,586  

Income before noncontrolling interests

     23,390       107       40,141       21,429  

Income attributable to noncontrolling interests

     148       123       93       320  

Net income/(loss) attributable to Associated Capital Group, Inc.'s shareholders

   $ 23,242     $ (16 )   $ 40,048     $ 21,109  
                                 

Net income per share attributable to Associated Capital Group, Inc.'s shareholders:

                                

Basic

   $ 1.09     $ 0.00     $ 1.87     $ 0.97  

Diluted

   $ 1.09     $ 0.00     $ 1.87     $ 0.97  
                                 

Weighted average shares outstanding (thousands):

                                

Basic

     21,275       21,672       21,389       21,836  

Diluted

     21,275       21,672       21,389       21,836  

 

 

Three Months Ended September 30, 2024 Compared to Three Months Ended September 30, 2023

 

Revenues

 

Total revenues in the third quarter were $2.4 million compared to $2.2 million in the third quarter of 2023.  Revenues generated by the GAMCO International SICAV – GAMCO Merger Arbitrage (the “SICAV”) were $1.1 million versus $0.8 million in the prior year period. All other revenues were $1.3 million compared to $1.4 million in the year ago quarter.

 

Starting in December 2023, the Company recognized 100% of the merger arbitrage SICAV revenues received by Gabelli Funds, LLC. In turn, AC pays the marketing expenses of the SICAV previously paid by Gabelli Funds, and remits an administrative fee to Gabelli Funds for administrative services provided. This change better aligns the financial arrangements with the services rendered by each party. The net effect of this change had no material impact on our operating results.

 

Incentive fees are not recognized until the uncertainty surrounding the amount of variable consideration ends and the fee is crystalized, typically on an annual basis on December 31. Unrecognized incentive fees at September 30, 2024 approximated $2.9 million. There were no material unrecognized incentive fees as of September 30, 2023.

 

 

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Expenses

 

Compensation, which includes variable compensation, salaries, bonuses and benefits, was $4.2 million and $4.1 million for the three month periods ended September 30, 2024 and 2023, respectively, primarily driven by higher performance-based compensation accruals on certain proprietary accounts as a result of performance. This increase was offset partially by lower variable based compensation expense in 2024 driven by lower average AUM. 

 

Management fee expense represents incentive-based and entirely variable compensation in the amount of 10% of income before management fee and income taxes and excluding the impact of consolidating entities and is payable to Mario J. Gabelli, Executive Chair, or his designee pursuant to his employment agreement. Management fee expense of $3.3 million was recorded for the three-month period ended September 30, 2024. There was no management fee expense for the three-month period ended September 30, 2023. 

 

Other operating expenses were $1.8 million during the three months ended September 30, 2024 compared to $1.7 million in the prior year's quarter driven primarily by marketing expenses on the realigned SICAV.

 

Other

 

Net gain/(loss) from investments is primarily related to the performance of our securities portfolio and investments in partnerships. Net gain from investments was $26.2 million for the third quarter of 2024 compared to a loss of $2.2 million in the third quarter of 2023. The primary drivers of this quarter's results included gains from our merger arbitrage partnerships and mutual fund holdings. 

 

Interest and dividend income increased to $11.1 million in the 2024 quarter from $6.3 million in the 2023 quarter primarily driven by a $2 per share special dividend declared on our holdings of GAMCO Investors, Inc.

 

There were no Shareholder-designated contributions in the 2024 quarter compared to $0.2 million in the 2023 quarter driven by timing of contributions.

 

Income taxes

 

The effective tax rate applied to our pre-tax income for the quarter ended September 30, 2024 was 22.9% compared to 60.8% in the 2023 quarter. The difference in effective tax rate period over period is primarily driven by deferred tax expense from a foreign investment which increased the prior year quarter's effective tax rate.

 

Nine Months Ended September 30, 2024 Compared to Nine Months Ended September 30, 2023

 

Revenues

 

Total revenues for the nine months ended September 30, 2024 were $8.0 million compared to $7.0 million in the nine months ended September 30, 2023. Revenues generated by the GAMCO International SICAV – GAMCO Merger Arbitrage (the “SICAV”) were $4.0 million versus $2.9 million in the prior year period. All other revenues were $4.0 million compared to $4.1 million in the year-ago quarter driven by lower average AUM in 2024.

 

Starting in December 2023, the Company recognized 100% of the merger arbitrage SICAV revenues received by Gabelli Funds, LLC. In turn, AC pays the marketing expenses of the SICAV previously paid by Gabelli Funds, and remits an administrative fee to Gabelli Funds for administrative services provided. This change better aligns the financial arrangements with the services rendered by each party. The net effect of this change had no material impact on our operating results.

 

Expenses

 

Compensation, which includes variable compensation, salaries, bonuses and benefits, was $12.0 million and $11.4 million for the nine month periods ended September 30, 2024 and 2023, respectively, primarily driven by higher stock-based compensation expense in 2024, offset partially by lower variable based compensation expense. 

 

Management fee expense represents incentive-based and entirely variable compensation in the amount of 10% of income before management fee and income taxes and excluding the impact of consolidating entities and is payable to Mario J. Gabelli, Executive Chair, or his designee pursuant to his employment agreement. Management fee expense was $5.7 million and $3.1 million for the nine month periods ended September 30, 2024 and 2023, respectively. 

 

Other operating expenses were $5.9 million during the nine months ended September 30, 2024 compared to $4.7 million in the prior year period driven primarily by marketing expenses on the realigned SICAV.

 

 

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Other

 

Net gain/(loss) from investments is primarily related to the performance of our securities portfolio and investments in partnerships. Investment gains were $42.8 million in the 2024 period compared to $21.6 million in the 2023 period.

 

Interest and dividend income increased to $25.0 million in the 2024 period from $17.5 million in the 2023 period primarily driven by a $2 per share special dividend declared on our holdings of GAMCO Investors, Inc. in September 2024 as well as increased interest income as a result of higher sustained interest rates in the 2024 period.

 

Shareholder-designated contributions for the nine months ended September 30, 2024 decreased to $0.4 million compared to $1.6 million in the prior year period, driven by timing of contributions.

 

Income taxes

 

The effective tax rate for the nine months ended September 30, 2024 and 2023 was 22.1% and 14.3%, respectively. The difference in effective tax rate period over period is primarily driven by deferred tax benefits from a foreign investment which reduced the prior year's effective tax rate

 

ASSETS UNDER MANAGEMENT

 

Our revenues are highly correlated to the level of assets under management and fees associated with our various investment products, rather than our own corporate assets. Assets under management, which are directly influenced by the level and changes of the overall equity markets, can also fluctuate through acquisitions, the creation of new products, and the addition of new accounts or the loss of existing accounts. Since various equity products have different fees, changes in our business mix may also affect revenues. At times, the performance of our equity products may differ markedly from popular market indices, and this can also impact our revenues.

 

Assets under management were $1.3 billion as of September 30, 2024 compared to $1.6 billion at December 31, 2023. The decrease from year-end was primarily attributable to investor outflows.

 

Assets Under Management (in millions)

 

                           

% Change From

  
   

September 30,

    

December 31,

    

September 30,

    

December 31,

    

September 30,

  
   

2024

    

2023

    

2023

    

2023

    

2023

  

Merger Arbitrage(a)

   $ 1,095     $ 1,312     $ 1,322       (16.5 )     (17.2 )

Long/Short Value(b)

     208       244       233       (14.8 )     (10.7 )

Other

     37       35       33       5.7       12.1  

Total AUM

   $ 1,340     $ 1,591     $ 1,588       (15.8 )     (15.6 )

 

(a) Includes $431, $621, and $613 of sub-advisory AUM related to GAMCO International SICAV - GAMCO Merger Arbitrage, $68, $69, and $67 of sub-advisory AUM related to Gabelli Merger Plus+ Trust Plc at September 30, 2024, December 31, 2023 and September 30, 2023, respectively.

(b) Includes $201, $237 and $226 where Associated Capital receives only performance fees, less expenses of $25, $25, and $24, respectively.

 

Fund flows for the three months ended September 30, 2024 (in millions):

 

   

June 30, 2024

    

Market Appreciation/ (Depreciation)

    

Foreign Currency(1)

    

Net Inflows/ (Outflows)

    

September 30, 2024

  

Merger Arbitrage

   $ 1,127     $ 49     $ 11     $ (92 )   $ 1,095  

Long/Short Value

     199       9       -       -       208  

Other

     36       2       -       (1 )     37  

Total AUM

   $ 1,362     $ 60     $ 11     $ (93 )   $ 1,340  

 

(1) Reflects the impact of currency fluctuations of non-US dollar denominated classes of investment funds.

 

The majority of our AUM have calendar year-end measurement periods, and our incentive fees are primarily recognized in the fourth quarter. Assets under management decreased on a net basis by $22 million for the quarter ended September 30, 2024 due to net investor outflows of $93 million, offset partially by market appreciation of $60 million and the impact of currency fluctuations in non-US dollar denominated classes of investment funds of $11 million.

 

 

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Liquidity and Capital Resources

 

Our principal assets consist of cash and cash equivalents; treasury securities; marketable securities, primarily equities, including 2.3 million shares of GAMCO; and interests in affiliated and third-party funds and partnerships. Although Investment Partnerships may be subject to restrictions as to the timing of distributions, the underlying investments of such Investment Partnerships are generally liquid, and the valuations of these products reflect that underlying liquidity.

 

Summary cash flow data is as follows (in thousands):

 

   

Nine Months Ended

  
   

September 30,

  
   

2024

    

2023

  

Cash flows provided by (used in):

                

Operating activities

   $ (45,844 )   $ 194,815  

Investing activities

     (2,962 )     2,330  

Financing activities

     (12,072 )     (18,949 )

Net (decrease)/increase in cash, cash equivalents and restricted cash

     (60,878 )     178,196  

Cash, cash equivalents and restricted cash at beginning of period

     347,057       221,269  

Cash, cash equivalents and restricted cash at end of period

   $ 286,179     $ 399,465  

 

 

We require relatively low levels of capital expenditures and have a highly variable cost structure where costs increase and decrease based on the level of revenues we receive. Our revenues, in turn, are highly correlated to the level of AUM and to investment performance. We anticipate that our available liquid assets should be sufficient to meet our cash requirements as we build out our operating business. At September 30, 2024, we had cash and cash equivalents of $260.9 million, Investments in U.S. Treasury Bills of $115.8 million and $242.3 million of investments net of securities sold, not yet purchased of $7.4 million. Included in cash and cash equivalents as of September 30, 2024 is $2.7 million which is held by consolidated investment funds and may not be readily available for the Company to access.

 

Net cash used in operating activities was $45.8 million for the nine months ended September 30, 2024. Operating cash flows in 2024 are driven by an increase in trading securities of $54.1 million, primarily driven by the investment of cash and cash equivalents into treasuries with maturities in excess of 90 days. In addition, also contributing to the cash used in operating activities was $34.1 million of adjustments for noncash items, primarily gains on investment securities and partnership investments, and $10.4 million of net receivables/payables. These uses of operating cash were partially offset by our net income of $40.1 million and net distributions from partnerships of $12.7 million. Net cash used in investing activities was $3.0 million primarily due to purchases of securities of $9.2 million, partially offset by proceeds from sales of securities of $5.0 million and return of capital on securities of $1.2 million. Net cash used in financing activities was $12.1 million resulting primarily from stock buyback payments of $9.6 million, dividends paid of $2.1 million and redemptions of redeemable noncontrolling interests of $0.4 million.

 

Net cash provided by operating activities was $194.8 million for the nine months ended September 30, 2023 due to $191.6 million of net decreases of securities and net distributions from investment partnerships and our net income of $21.4 million, partially offset by $17.8 million of adjustments for noncash items, primarily gains on investments securities and partnership investments and deferred taxes and $0.4 million of net receivables/payables. Net cash provided by investing activities was $2.3 million primarily due to return of capital on securities of $1.2 million and proceeds from sales of securities of $2.2 million, partially offset by purchases of securities of $1.2 million. Net cash used in financing activities was $18.9 million resulting primarily from stock buyback payments of $13.4 million, redemptions of redeemable noncontrolling interests of $3.4 million and dividends paid of $2.2 million.  

 

Critical Accounting Policies and Estimates

 

The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ significantly from those estimates. See Note 1 and the Company’s Critical Accounting Policies in Management’s Discussion and Analysis ("MD&A") of Financial Condition and Results of Operations in AC’s 2023 Annual Report on Form 10-K filed with the SEC on March 21, 2024 for details on Critical Accounting Policies.

 

ITEM 3:   Quantitative and Qualitative Disclosures About Market Risk

 

Smaller reporting companies are not required to provide the information required by this item.

 

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ITEM 4.   Controls and Procedures

 

Disclosure Controls and Procedures

 

As of the end of the period covered by this report, an evaluation was carried out under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”)). Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were effective as of and for the period covered by this report.

 

Internal Control over Financial Reporting

 

There have been no changes in our internal control over financial reporting as defined by Rule 13a-15(f) that occurred during our most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

Forward-Looking Information

 

Our disclosure and analysis in this report contain some forward-looking statements. Forward-looking statements give our current expectations or forecasts of future events. You can identify these statements because they do not relate strictly to historical or current facts. They use words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” and other words and terms of similar meaning. They also appear in any discussion of future operating or financial performance. In particular, these include statements relating to future actions, future performance of our products, expenses, the outcome of any legal proceedings, and financial results. Although we believe that we are basing our expectations and beliefs on reasonable assumptions within the bounds of what we currently know about our business and operations, there can be no assurance that our actual results will not differ materially from what we expect or believe. Some of the factors that could cause our actual results to differ from our expectations or beliefs include, without limitation:

 

 

•

the adverse effect from a decline in the securities markets

 

 

•

 a decline in the performance of our products

 

 

•

 a general downturn in the economy

 

 

•

changes in government policy or regulation

 

 

•

changes in our ability to attract or retain key employees

 

 

•

 unforeseen costs and other effects related to legal proceedings or investigations of governmental and self-regulatory organizations

 

We also direct your attention to any more specific discussions of risk contained in our Form 10 and other public filings. We are providing these statements as permitted by the Private Litigation Reform Act of 1995. We do not undertake to update publicly any forward-looking statements if we subsequently learn that we are unlikely to achieve our expectations or if we receive any additional information relating to the subject matters of our forward-looking statements.

 

 

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PART II:   Other Information

 

 

ITEM 1:    Legal Proceedings

 

Currently, we are not subject to any legal proceedings that individually or in the aggregate involved a claim for damages in excess of 10% of our consolidated assets. From time to time, we may be named in legal actions and proceedings. These actions may seek substantial or indeterminate compensatory as well as punitive damages or injunctive relief. We are also subject to governmental or regulatory examinations or investigations. Examinations or investigations can result in adverse judgments, settlements, fines, injunctions, restitutions or other relief. For any such matters, the condensed consolidated financial statements include the necessary provisions for losses that we believe are probable and estimable. Furthermore, we evaluate whether there exist losses which may be reasonably possible and, if material, make the necessary disclosures. However, management believes such matters, both those that are probable and those that are reasonably possible, are not material to the Company’s condensed consolidated financial condition, operations, or cash flows at September 30, 2024. See also Note 10, Guarantees, Contingencies and Commitments, to the condensed consolidated financial statements in Part I, Item 1 of this Form 10-Q.

 

ITEM 1A:   Risk Factors.

 

Smaller reporting companies are not required to provide the information required by this item.

 

ITEM 2:          Unregistered Sales of Equity Securities And Use Of Proceeds

 

The following table provides information for our repurchase of our Class A Stock during the quarter ended September 30, 2024:

 

Period

  

Total Number of Shares Repurchased

    

Average Price Paid Per Share, net of Commissions

    

Total Number of Shares Repurchased as Part of Publicly Announced Plans or Programs

    

Maximum Number of Shares That May Yet Be Purchased Under the Plans or Programs

  

07/01/24 - 07/31/24

     83,738     $ 31.39       83,738       240,103  

08/01/24 - 08/31/24

     13,996       33.27       13,996       426,107 (1)

09/01/24 - 09/30/24

     9,484       33.24       9,484       416,623  

Totals

     107,218     $ 31.80       107,218          

 

(1) On August 7, 2024, the Board of Directors authorized the repurchase of an additional 200,000 shares.

 

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ITEM 6:                     (a) Exhibits

 

Exhibit

Number

  

Description of Exhibit

 

  

 

2.1

  

Separation and Distribution Agreement, dated November 30, 2015, between GAMCO Investors, Inc., a Delaware corporation (“GAMCO”), and Associated Capital Group, Inc., a Delaware corporation (the “Company”). (Incorporated by reference to Exhibit 2.1 to the Company’s Form 8-K dated November 30, 2015 filed with the Securities and Exchange Commission on December 4, 2015).

 

  

 

3.1

  

Amended and Restated Certificate of Incorporation of the Company. (Incorporated by reference to Exhibit 3.1 to the Company’s Form 8-K dated November 19, 2015 filed with the Securities and Exchange Commission on November 25, 2015).

 

  

 

3.2

  

Amended and Restated Bylaws of the Company. (Incorporated by reference to Exhibit 3.2 to the Company’s Report on Form 8-K dated November 19, 2015 filed with the Securities and Exchange Commission on November 25, 2015).

 

  

 

4.1

  

Form of Common Stock Certificate. (Incorporated by reference to Exhibit 4.1 to Amendment No. 4 to the Company’s Registration Statement on Form 10 filed with the Securities and Exchange Commission on October 21, 2015).

 

  

 

4.2

  

Description of The Registrant’s Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934. (Incorporated by reference to Exhibit 4.2 of the Company’s Report on Form 10-K filed with the Commission on March 16, 2020).

 

  

 

10.1

  

Service Mark and Name License Agreement, dated November 30, 2015, by and between the Company and GAMCO. (Incorporated by reference to Exhibit 10.1 to the Company’s Form 8-K dated November 30, 2015 filed with the Commission on December 4, 2015).

 

  

 

10.2

  

Transitional Administrative and Management Services Agreement, dated November 30, 2015, by and between the Company and GAMCO. (Incorporated by reference to Exhibit 10.2 to the Company’s Form 8-K dated November 30, 2015 filed with the Commission on December 4, 2015).

 

  

 

10.3

  

Employment Agreement between the Company and Mario J. Gabelli dated November 30, 2015 (Incorporated by reference to Exhibit 10.3 to the Company’s Form 8-K dated November 30, 2015 filed with the Commission on December 4, 2015).

 

  

 

10.4

  

Promissory Note in aggregate principal amount of $250,000,000, dated November 30, 2015, issued by GAMCO in favor of the Company (Incorporated by reference to Exhibit 10.4 to the Company’s Form 8-K dated November 30, 2015 filed with the Commission on December 4, 2015).

 

  

 

10.5

  

Tax Indemnity and Sharing Agreement, dated November 30, 2015, by and between the Company and GAMCO. (Incorporated by reference to Exhibit 10.5 to the Company’s Form 8-K dated November 30, 2015 filed with the Commission on December 4, 2015).

 

  

 

10.6

  

2015 Stock Award Incentive Plan (Incorporated by reference to Exhibit 10.11 to Amendment No. 4 to the Company’s Registration Statement on Form 10 filed with the Securities and Exchange Commission on October 21, 2015).

 

  

 

10.7

  

Form of Indemnification Agreement by and between the Company and the Indemnitee defined therein (Incorporated by reference to Exhibit 10.7 to Amendment No. 4 to the Company’s Registration Statement on Form 10 filed with the Securities and Exchange Commission on October 21, 2015).

 

  

 

10.8

  

Agreement and Plan of Merger, dated as of October 31, 2019, by and among Morgan Group Holding Co., G.R. acquisition, LLC, G.research, LLC, Institutional Services Holdings, LLC and Associated Capital Group, Inc. (Incorporated by reference to Exhibit 2.1 to the Current Report on Form 8-K of Morgan Group Holding Co. filed with the Securities and Exchange Commission on November 6, 2019).

 

  

 

31.1

  

Certification of CEO pursuant to Rule 13a-14(a).

 

 

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31.2

  

Certification of CFO pursuant to Rule 13a-14(a).
     

32.1

  

Certification of CEO pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

 

  

 

32.2

  

Certification of CFO pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes- Oxley Act of 2002.

 

  

 
97.1   Associated Capital Group, Inc. Clawback Policy (Incorporated by reference to Exhibit 97.1 to the Company's Form 10-K dated December 31, 2023 filed with the Commission on March 21, 2024).
     

101.INS

  

Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document)

 

  

 

101.SCH

  

Inline XBRL Taxonomy Extension Schema Document

 

  

 

101.CAL

  

Inline XBRL Taxonomy Extension Calculation Linkbase Document

 

  

 

101.DEF

  

Inline XBRL Taxonomy Extension Definition Linkbase Document

 

  

 

101.LAB

  

Inline XBRL Taxonomy Extension Label Linkbase Document

 

  

 

101.PRE

  

Inline XBRL Taxonomy Extension Presentation Linkbase Document
     

104

  

Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

 

 

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SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

ASSOCIATED CAPITAL GROUP, INC.

(Registrant)

      

 

 

 

      

 

By:

/s/ Ian J. McAdams

      

 

Name:

Ian J. McAdams

      

 

Title:

Chief Financial Officer

      

 

 

 

      

 

Date: November 13, 2024

    

 

 

 

 

28

Exhibit 31.1

 

Certifications

 

I, Douglas R. Jamieson, certify that:

 

 

1.

I have reviewed this quarterly report on Form 10-Q of Associated Capital Group, Inc.;

 

 

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

 

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of income and cash flows of the registrant as of, and for, the periods presented in this report;

 

 

4.

The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

 

a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

 

b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

 

c)

Evaluated the effectiveness of the registrant’s disclosure controls and procedures as of the end of the period covered by this report; and

 

 

d)

Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting;

 

 

5.

The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

 

a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

 

b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

By:

/s/ Douglas R. Jamieson

  

Name:

Douglas R. Jamieson

  

Title:

Chief Executive Officer

  
     

Date:

November 13, 2024

  

 

 

Exhibit 31.2

 

Certifications

 

I, Ian J. McAdams, certify that:

 

 

1.

I have reviewed this quarterly report on Form 10-Q of Associated Capital Group, Inc.;

 

 

2.

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

 

3.

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of income and cash flows of the registrant as of, and for, the periods presented in this report;

 

 

4.

The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

 

a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

 

b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

 

c)

Evaluated the effectiveness of the registrant’s disclosure controls and procedures as of the end of the period covered by this report; and

 

 

d)

Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting;

 

 

5.

The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

 

a)

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

 

b)

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

By:

/s/ Ian J. McAdams

 

Name:

Ian J. McAdams

 

Title:

Chief Financial Officer

 

 

 

 

Date:

November 13, 2024

 

 

 

Exhibit 32.1

 

Certification of CEO Pursuant to

18 U.S.C. Section 1350,

as Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

 

In connection with the Quarterly Report on Form 10-Q of Associated Capital Group, Inc. (the “Company”) for the quarter ended September 30, 2024 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Douglas R. Jamieson, as Chief Executive Officer of the Company, hereby certifies, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his knowledge:

 

 

(1)

The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

 

(2)

The information contained in the Report fairly presents, in all material respects, the financial condition and results of income of the Company.

 

By:

/s/ Douglas R. Jamieson

  

Name:

Douglas R. Jamieson

  

Title:

Chief Executive Officer

  
     

Date:

November 13, 2024

  

 

This certification accompanies the Report pursuant to § 906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by the Sarbanes-Oxley Act of 2002, be deemed filed by the Company for purposes of §18 of the Securities Exchange Act of 1934, as amended.

 

 

Exhibit 32.2

 

Certification of CFO Pursuant to

18 U.S.C. Section 1350,

as Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

 

In connection with the Quarterly Report on Form 10-Q of Associated Capital Group, Inc. (the “Company”) for the quarter ended September 30, 2024 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Ian J. McAdams, as Chief Financial Officer of the Company, hereby certifies, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his knowledge:

 

 

(1)

The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

 

(2)

The information contained in the Report fairly presents, in all material respects, the financial condition and results of income of the Company.

 

By:

/s/ Ian J. McAdams

      

Name:

Ian J. McAdams

      

Title:

Chief Financial Officer

      

 

 

      

Date:

November 13, 2024

      

 

This certification accompanies the Report pursuant to § 906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by the Sarbanes-Oxley Act of 2002, be deemed filed by the Company for purposes of §18 of the Securities Exchange Act of 1934, as amended.

 

 
v3.24.3
Document And Entity Information - shares
 9 Months Ended
Sep. 30, 2024
Nov. 01, 2024
Document Information [Line Items]    
Entity Central Index Key 0001642122  
Entity Registrant Name Associated Capital Group, Inc.  
Amendment Flag false  
Current Fiscal Year End Date --12-31  
Document Fiscal Period Focus Q3  
Document Fiscal Year Focus 2024  
Document Type 10-Q  
Document Quarterly Report true  
Document Period End Date Sep. 30, 2024  
Document Transition Report false  
Entity File Number 001-37387  
Entity Incorporation, State or Country Code DE  
Entity Tax Identification Number 47-3965991  
Entity Address, Address Line One 191 Mason Street  
Entity Address, City or Town Greenwich  
Entity Address, State or Province CT  
Entity Address, Postal Zip Code 06830  
City Area Code 203  
Local Phone Number 629-9595  
Title of 12(b) Security Class A Common Stock, par value $0.001 per share  
Trading Symbol AC  
Security Exchange Name NYSE  
Entity Current Reporting Status Yes  
Entity Interactive Data Current Yes  
Entity Filer Category Non-accelerated Filer  
Entity Small Business true  
Entity Emerging Growth Company false  
Entity Shell Company false  
Common Class B [Member]    
Document Information [Line Items]    
Entity Common Stock, Shares Outstanding   18,950,571
Common Class A [Member]    
Document Information [Line Items]    
Entity Common Stock, Shares Outstanding   2,286,564
v3.24.3
Condensed Consolidated Statements of Financial Condition (Current Period Unaudited) - USD ($)
$ in Thousands
Sep. 30, 2024
Dec. 31, 2023
ASSETS    
Cash and cash equivalents (includes U.S. Treasury Bills with maturities of 3 months or less) $ 260,868 $ 317,487
Investments in U.S. Treasury Bills with maturities greater than 3 months 115,829 89,155
Investments in equity securities (includes GAMCO stock with a fair value of $56.4 million and $45.6 million, respectively) 249,669 196,583
Investments in affiliated registered investment companies 140,355 126,751
Investments in partnerships 138,905 142,974
Receivable from brokers 26,985 16,005
Receivable from brokers (cash held for real estate purchase) 0 14,263
Investment advisory fees receivable 1,233 4,711
Income taxes receivable, including deferred tax assets, net 2,588 8,474
Goodwill 3,519 3,519
Other assets 32,033 22,999
Total assets 977,153 943,797
LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY    
Payable to brokers 7,865 4,459
Income taxes payable, including deferred tax liabilities, net 989 0
Compensation payable 17,488 15,169
Securities sold, not yet purchased 7,376 5,918
Accrued expenses and other liabilities 2,288 5,173
Dividend payable 42,494 0
Total liabilities 78,500 30,719
Redeemable noncontrolling interests 5,836 6,103
Commitments and contingencies (Note 10)
Equity:    
Preferred stock, $0.001 par value; 10,000,000 shares authorized; none issued and outstanding 0 0
Additional paid-in capital 999,047 999,047
Retained earnings 43,647 48,231
Treasury stock, at cost (4,344,606 and 4,054,565 shares, respectively) (149,902) (140,328)
Total equity 892,817 906,975
Total liabilities, redeemable noncontrolling interests and equity 977,153 943,797
Common Class A [Member]    
Equity:    
Common Stock 6 6
Common Class B [Member]    
Equity:    
Common Stock 19 19
Affiliated Entity [Member]    
ASSETS    
Receivable from affiliates 5,169 876
Investment, Affiliated Issuer [Member]    
ASSETS    
Investments in affiliated registered investment companies $ 140,355 $ 126,751
v3.24.3
Condensed Consolidated Statements of Financial Condition (Current Period Unaudited) (Parentheticals) - USD ($)
$ in Thousands
Sep. 30, 2024
Dec. 31, 2023
Stock value $ 249,669 $ 196,583
Preferred stock, par value (in dollars per share) $ 0.001 $ 0.001
Preferred stock, shares authorized (in shares) 10,000,000 10,000,000
Preferred stock, shares issued (in shares) 0 0
Preferred stock, shares outstanding (in shares) 0 0
Common stock, shares outstanding (in shares) 21,248  
Treasury stock shares (in shares) 4,344,606 4,054,565
Common Class A [Member]    
Common stock, par value (in dollars per share) $ 0.001 $ 0.001
Common stock, shares authorized (in shares) 100,000,000 100,000,000
Common stock, shares issued (in shares) 6,641,601 6,641,601
Common stock, shares outstanding (in shares) 2,296,995 2,587,036
Common Class B [Member]    
Common stock, par value (in dollars per share) $ 0.001 $ 0.001
Common stock, shares authorized (in shares) 100,000,000 100,000,000
Common stock, shares issued (in shares) 19,196,792 19,196,792
Common stock, shares outstanding (in shares) 18,950,571 18,950,571
GAMCO Investors, Inc [Member]    
Stock value $ 56,400 $ 45,600
v3.24.3
Condensed Consolidated Statements of Income (Unaudited) - USD ($)
$ in Thousands
 3 Months Ended 9 Months Ended
Sep. 30, 2024
Sep. 30, 2023
Sep. 30, 2024
Sep. 30, 2023
Revenues        
Total revenues $ 2,415 $ 2,200 $ 8,021 $ 7,047
Expenses        
Compensation 4,215 4,078 11,977 11,437
Management fee 3,312 12 5,736 3,075
Management fee (3,312) (12) (5,736) (3,075)
Other operating expenses 1,804 1,655 5,868 4,660
Total expenses 9,331 5,721 23,581 19,172
Operating loss (6,916) (3,521) (15,560) (12,125)
Other income/(expense)        
Net gain/(loss) from investments 26,173 (2,173) 42,808 21,635
Interest and dividend income 11,142 6,336 24,985 17,497
Interest expense (76) (134) (228) (388)
Shareholder-designated contribution 0 (235) (449) (1,604)
Total other income, net 37,239 3,794 67,116 37,140
Income before income taxes 30,323 273 51,556 25,015
Income tax expense 6,933 166 11,415 3,586
Income before noncontrolling interests 23,390 107 40,141 21,429
Income attributable to noncontrolling interests 148 123 93 320
Net income/(loss) attributable to Associated Capital Group, Inc.'s shareholders $ 23,242 $ (16) $ 40,048 $ 21,109
Net income/(loss) per share attributable to Associated Capital Group, Inc.'s shareholders:        
Basic (in dollars per share) $ 1.09 $ 0 $ 1.87 $ 0.97
Diluted (in dollars per share) $ 1.09 $ 0 $ 1.87 $ 0.97
Weighted average shares outstanding (in thousands):        
Basic (in shares) 21,275 21,672 21,389 21,836
Diluted (in shares) 21,275 21,672 21,389 21,836
Actual shares outstanding (in thousands) (in shares) 21,248 21,623 21,248 21,623
Investment Advice [Member]        
Revenues        
Total revenues $ 2,310 $ 2,098 $ 7,706 $ 6,789
Financial Service, Other [Member]        
Revenues        
Total revenues $ 105 $ 102 $ 315 $ 258
v3.24.3
Condensed Consolidated Statements of Equity and Redeemable Noncontrolling Interests (Unaudited) - USD ($)
$ in Thousands
Common Stock [Member]
Retained Earnings [Member]
Additional Paid-in Capital [Member]
Treasury Stock, Common [Member]
Redeemable Noncontrolling Interests [Member]
Total
Balance at Dec. 31, 2022 $ 25 $ 15,126 $ 999,047 $ (124,002) $ 10,193 $ 890,196
Net income/(loss) 0 21,109 0 0 320 21,109
Dividends declared ($2.00 per share) 0 (2,188) 0 0 0 (2,188)
Purchases of treasury stock 0 0 0 (13,381) 0 (13,381)
Redemptions of noncontrolling interests 0 0 0 0 (3,380) 0
Balance at Sep. 30, 2023 25 34,047 999,047 (137,383) 7,133 895,736
Balance at Jun. 30, 2023 25 34,063 999,047 (133,568) 7,086 899,567
Net income/(loss) 0 (16) 0 0 123 (16)
Dividends declared ($2.00 per share)           0
Purchases of treasury stock 0 0 0 (3,815) 0 (3,815)
Redemptions of noncontrolling interests 0 0 0 0 (76) 0
Balance at Sep. 30, 2023 25 34,047 999,047 (137,383) 7,133 895,736
Balance at Dec. 31, 2023 25 48,231 999,047 (140,328) 6,103 906,975
Net income/(loss) 0 40,048 0 0 93 40,048
Dividends declared ($2.00 per share) 0 (44,632) 0 0 0 (44,632)
Purchases of treasury stock 0 0 0 (9,574) 0 (9,574)
Redemptions of noncontrolling interests 0 0 0 0 (360) 0
Balance at Sep. 30, 2024 25 43,647 999,047 (149,902) 5,836 892,817
Balance at Jun. 30, 2024 25 62,899 999,047 (146,492) 5,688 915,479
Net income/(loss) 0 23,242 0 0 148 23,242
Dividends declared ($2.00 per share) 0 (42,494) 0 0 0 (42,494)
Purchases of treasury stock 0 0 0 (3,410) 0 (3,410)
Balance at Sep. 30, 2024 $ 25 $ 43,647 $ 999,047 $ (149,902) $ 5,836 $ 892,817
v3.24.3
Condensed Consolidated Statements of Equity and Redeemable Noncontrolling Interests (Unaudited) (Parentheticals) - $ / shares
 3 Months Ended 9 Months Ended
Sep. 30, 2024
Sep. 30, 2024
Sep. 30, 2023
Dividends declared, per share (in dollars per share) $ 2 $ 2.1 $ 0.1
v3.24.3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)
$ in Thousands
 9 Months Ended
Sep. 30, 2024
Sep. 30, 2023
Operating activities    
Net income $ 40,141 $ 21,429
Adjustments to reconcile net income to net cash (used in)/provided by operating activities:    
Equity in net (gains)/losses from partnerships (8,624) 848
Depreciation and amortization 272 270
Deferred income taxes 9,037 (246)
Donated securities 1,346 1,107
Unrealized gains on securities (31,381) (15,703)
Realized gains on sales of securities (4,792) (4,108)
(Increase)/decrease in assets:    
Investments in trading securities (54,118) 184,788
Investments in partnerships:    
Contributions to partnerships (9,700) (2,390)
Distributions from partnerships 22,394 9,166
Receivable from affiliates (4,293) 2,172
Receivable from brokers (976) (1,877)
Investment advisory fees receivable 3,478 2,536
Income taxes receivable (2,682) 2,644
Other assets (9,306) 65
Increase/(decrease) in liabilities:    
Payable to brokers 3,406 (2,166)
Income taxes payable 520 43
Compensation payable 2,319 (3,021)
Accrued expenses and other liabilities (2,885) (742)
Total adjustments (85,985) 173,386
Net cash (used in)/provided by operating activities (45,844) 194,815
Investing activities    
Purchases of securities (9,185) (1,162)
Proceeds from sales of securities 5,023 2,245
Return of capital on securities 1,200 1,247
Net (used in)/provided by investing activities (2,962) 2,330
Financing activities    
Dividends paid (2,138) (2,188)
Purchases of treasury stock (9,574) (13,381)
Redemptions of redeemable noncontrolling interests (360) (3,380)
Net cash used in financing activities (12,072) (18,949)
Net (decrease)/increase in cash, cash equivalents and restricted cash (60,878) 178,196
Cash, cash equivalents and restricted cash at beginning of period 347,057 221,269
Cash, cash equivalents and restricted cash at end of period 286,179 399,465
Supplemental disclosures of cash flow information:    
Cash paid for interest 228 134
Cash paid for taxes 4,509 849
Reconciliation of Cash, cash equivalents and restricted cash at end of period:    
Cash and cash equivalents (includes U.S. Treasury Bills with maturities of 3 months or less) 260,868 381,253
Restricted cash included in receivable from brokers 12,868 5,153
Cash, cash equivalents and restricted cash 286,179 399,465
Cash Held for Real Estate Purchase [Member]    
Reconciliation of Cash, cash equivalents and restricted cash at end of period:    
Cash and cash equivalents (includes U.S. Treasury Bills with maturities of 3 months or less) 0 13,059
Receivables from Brokers [Member]    
Reconciliation of Cash, cash equivalents and restricted cash at end of period:    
Cash and cash equivalents (includes U.S. Treasury Bills with maturities of 3 months or less) $ 12,443 $ 0
v3.24.3
Supplemental Disclosure of Non-cash Activity
 9 Months Ended
Sep. 30, 2024
Notes to Financial Statements  
Cash Flow, Supplemental Disclosures [Text Block]

Supplemental disclosure of non-cash activity:

 

-

On September 19, 2024, the Board of Directors declared a special cash dividend of $2.00 per share, payable on November 4, 2024, to Class A and Class B shareholders of record on October 21, 2024. The aggregate payment will be $42,494 thousand based on the shares outstanding as of the record date. The liability for this dividend is recorded within Dividend payable on our condensed consolidated statements of financial condition as of September 30, 2024.

 

See accompanying notes.
v3.24.3
Note 1 - Organization
 9 Months Ended
Sep. 30, 2024
Notes to Financial Statements  
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]

1.    Organization

 

Unless we have indicated otherwise, or the context otherwise requires, references in this report to “Associated Capital Group, Inc.”, "Associated Capital", “AC Group”, “the Company”, “AC”, “we”, “us” and “our” or similar terms are to Associated Capital Group, Inc., its predecessors and its subsidiaries.

 

We are a Delaware corporation that provides alternative investment management, and we derive investment income from proprietary investments of cash and other assets in our operating business.

 

Gabelli & Company Investment Advisors, Inc. (“GCIA”), a wholly-owned subsidiary of AC, and its wholly-owned subsidiary, Gabelli & Partners, LLC (“Gabelli & Partners”), collectively serve as general partners or investment managers to investment funds, including limited partnerships and offshore companies (collectively, “Investment Partnerships”) and separate accounts. We primarily manage assets across a range of risk and event arbitrage portfolios and in equity event-driven value strategies. The businesses earn management and incentive fees from their advisory activities. Management fees are largely based on a percentage of assets under management. Incentive fees are based on the percentage of the investment returns of certain clients’ portfolios. GCIA is an investment adviser registered with the Securities and Exchange Commission under the Investment Advisers Act of 1940, as amended.

 

Basis of Presentation

 

The unaudited interim condensed consolidated financial statements of AC Group included herein have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by GAAP in the United States for complete financial statements. The unaudited interim condensed consolidated financial statements reflect all adjustments, which are of a normal recurring nature, necessary for a fair presentation of financial position, results of operations and cash flows of the Company for the interim periods presented and are not necessarily indicative of a full year’s results. These interim condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2023.

 

The interim condensed consolidated financial statements include the accounts of AC Group and its subsidiaries. All intercompany transactions and balances have been eliminated. The details on the impact of consolidating certain partnership entities on the condensed consolidated financial statements can be seen in Note 4. Investment Partnerships and Other Entities.

 

For the three and nine months ended September 30, 2024 and 2023, there were no items related to other comprehensive income.

 

Use of Estimates

 

The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported on the condensed consolidated financial statements and accompanying notes. Actual results could differ from those estimates.

 

Recent Accounting Developments

 

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The amendments require disclosure of specific categories in the rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold and further disaggregation of income taxes paid for individually significant jurisdictions. The ASU is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. We are currently evaluating the impact of this guidance on the disclosures within our consolidated financial statements.

 

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280), which improves reportable segment disclosure requirements. The new standard will require enhanced disclosures about a public company’s significant segment expenses and more timely and detailed segment information reporting throughout the fiscal period, including for companies with a single reportable segment. The standard is effective for annual periods beginning after December 15, 2023 and interim periods beginning after December 15, 2024, and early adoption is permitted. We are currently evaluating the impact of this guidance on the disclosures within our consolidated financial statements.

 
v3.24.3
Note 2 - Revenue
 9 Months Ended
Sep. 30, 2024
Notes to Financial Statements  
Revenue from Contract with Customer [Text Block]

2.    Revenue

 

The Company’s major revenue sources are as follows for the three and nine months ended September 30, 2024 and 2023 (in thousands):

 

  Three Months Ended September 30,  Nine Months Ended September 30, 
  

2024

  

2023

  

2024

  

2023

 

Investment advisory and incentive fees

                

Asset-based advisory fees

 $1,175  $1,265  $3,619  $3,871 

Performance-based advisory fees

  48   1   49   2 

Sub-advisory fees

  1,087   832   4,038   2,916 

Total investment advisory and incentive fees

  2,310   2,098   7,706   6,789 
                 

Other

  105   102   315   258 
                 

Total revenues

 $2,415  $2,200  $8,021  $7,047 

 
v3.24.3
Note 3 - Investments in Securities
 9 Months Ended
Sep. 30, 2024
Notes to Financial Statements  
Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

3.    Investments in Securities

 

Investments in securities at September 30, 2024 and December 31, 2023, consisted of the following (in thousands):

 

  

September 30, 2024

  

December 31, 2023

 
  

Cost

  

Fair Value

  

Cost

  

Fair Value

 

Debt - Trading Securities:

                

U.S. Treasury Bills

 $114,578  $115,829  $88,300  $89,155 

Equity Securities:

                

Common stocks

  229,350   244,874   198,269   191,346 

Mutual funds

  651   1,450   566   1,186 

Other investments

  4,164   3,345   5,166   4,051 

Total investments in equity securities

  234,165   249,669   204,001   196,583 

Total investments in securities

 $348,743  $365,498  $292,301  $285,738 

 

In September 2024, GAMCO Investors, Inc. declared a special cash dividend of $2 per share on their class A common stock and class B common stock. As of September 30, 2024, Receivable from affiliates on the condensed consolidated statements of financial condition included $4.6 million for dividends receivable based on the 2.3 million shares of GAMCO class A stock that we held on the declaration date.

 

Securities sold, not yet purchased at September 30, 2024 and December 31, 2023, consisted of the following (in thousands):

 

  

September 30, 2024

  

December 31, 2023

 
  

Cost

  

Fair Value

  

Cost

  

Fair Value

 
                 

Common stocks

 $6,604  $6,838  $5,227  $5,035 

Other investments

  114   538   631   883 

Total securities sold, not yet purchased

 $6,718  $7,376  $5,858  $5,918 

 

Investments in affiliated registered investment companies at September 30, 2024 and December 31, 2023, consisted of the following (in thousands):

 

  

September 30, 2024

  

December 31, 2023

 
  

Cost

  

Fair Value

  

Cost

  

Fair Value

 
                 

Closed-end funds

 $39,924  $57,898  $39,680  $53,048 

Mutual funds

  54,898   82,457   50,136   73,703 

Total investments in affiliated registered investment companies

 $94,822  $140,355  $89,816  $126,751 

 

 
v3.24.3
Note 4 - Investment Partnerships and Other Entities
 9 Months Ended
Sep. 30, 2024
Notes to Financial Statements  
Investment Holdings [Text Block]

4.    Investment Partnerships and Other Entities

 

The Company is a general partner or co-general partner of various affiliated entities whose underlying assets consist primarily of marketable securities (“Affiliated Entities”). The Company had investments in Affiliated Entities totaling $99.1 million and $107.4 million at September 30, 2024 and December 31, 2023, respectively. The Company also had investments in unaffiliated partnerships, offshore funds and other entities of $39.8 million and $35.6 million at September 30, 2024, and December 31, 2023, respectively (“Unaffiliated Entities”). We evaluate each entity to determine its appropriate accounting treatment and disclosure. Certain of the Affiliated Entities, and none of the Unaffiliated Entities, are consolidated.

 

Investments in partnerships that are not required to be consolidated are accounted for using the equity method and are included in investments in partnerships on the condensed consolidated statements of financial condition. The Company reflects the equity in earnings of these Affiliated Entities and Unaffiliated Entities in net gain/(loss) from investments on the condensed consolidated statements of income.

 

Capital may generally be redeemed from Affiliated Entities on a monthly basis upon adequate notice as determined in the sole discretion of each entity’s investment manager. Capital invested in Unaffiliated Entities may generally be redeemed at various intervals ranging from monthly to annually upon notice of 30 to 95 days. Certain Unaffiliated Entities and Affiliated Entities may require a minimum investment period before capital can be voluntarily redeemed (a “Lockup Period”). No investment in any Investment Partnership has an unexpired Lockup Period. The Company has no material outstanding capital commitments to any Affiliated or Unaffiliated Entity.

 

Consolidated Entities

 

The following table reflects the net impact of the consolidated investment partnerships (“Consolidated Entities”) on the condensed consolidated statements of financial condition (in thousands):

 

  

September 30, 2024

 
  

Prior to

  

Consolidated

     

Assets

 

Consolidation

  

Entities

  

As Reported

 

Cash and cash equivalents

 $258,195  $2,673  $260,868 

Investments in U.S. Treasury Bills

  113,338   2,491   115,829 

Investments in equity securities

  183,191   66,478   249,669 

Investments in affiliated registered investment companies

  195,119   (54,764)  140,355 

Investments in partnerships

  159,717   (20,812)  138,905 

Receivable from brokers

  17,556   9,429   26,985 

Investment advisory fees receivable

  1,240   (7)  1,233 

Other assets(1)

  40,645   2,664   43,309 

Total assets

 $969,001  $8,152  $977,153 

Liabilities, redeemable noncontrolling interests and equity

            

Securities sold, not yet purchased

 $6,903  $473  $7,376 

Payable to brokers and other liabilities(1)

  26,787   1,843   28,630 

Dividends payable

  42,494   -   42,494 

Redeemable noncontrolling interests

  -   5,836   5,836 

Total equity

  892,817   -   892,817 

Total liabilities, redeemable noncontrolling interests and equity

 $969,001  $8,152  $977,153 

 

 

 

 

  

December 31, 2023

 
  

Prior to

  

Consolidated

     

Assets

 Consolidation  Entities  As Reported 

Cash and cash equivalents

 $299,508  $17,979  $317,487 

Investments in U.S. Treasury Bills

  79,714   9,441   89,155 

Investments in equity securities

  149,154   47,429   196,583 

Investments in affiliated registered investment companies

  181,641   (54,890)  126,751 

Investments in partnerships

  163,226   (20,252)  142,974 

Receivable from brokers(1)

  25,026   5,242   30,268 

Investment advisory fees receivable

  4,714   (3)  4,711 

Other assets(1)

  33,444   2,424   35,868 

Total assets

 $936,427  $7,370  $943,797 

Liabilities, redeemable noncontrolling interests and equity

            

Securities sold, not yet purchased

 $5,639  $279  $5,918 

Payable to brokers and other liabilities(1)

  23,813   988   24,801 

Redeemable noncontrolling interests

  -   6,103   6,103 

Total equity

  906,975   -   906,975 

Total liabilities, redeemable noncontrolling interests and equity

 $936,427  $7,370  $943,797 

 

(1) Represents the summation of multiple assets and liabilities from the condensed consolidated statements of financial condition.

 

The following table reflects the net impact of the Consolidated Entities on the condensed consolidated statements of income (in thousands):

 

  Three Months Ended September 30, 2024 
  

Prior to

  

Consolidated

     
  

Consolidation

  

Entities

  

As Reported

 

Total revenues

 $2,527  $(112) $2,415 

Operating loss

  (6,545)  (371)  (6,916)

Total other income, net

  36,353   886   37,239 

Income before noncontrolling interests

  23,242   148   23,390 

Income attributable to noncontrolling interests

  -   148   148 

Net income/(loss)

 $23,242  $-  $23,242 

 

  Three Months Ended September 30, 2023 
  

Prior to

  

Consolidated

     
  

Consolidation

  

Entities

  

As Reported

 

Total revenues

 $2,310  $(110) $2,200 

Operating loss

  (3,156)  (365)  (3,521)

Total other income, net

  3,044   750   3,794 

Income/(loss) before noncontrolling interests

  (16)  123   107 

Income attributable to noncontrolling interests

  -   123   123 

Net income/(loss)

 $(16) $-  $(16)

 

 

  Nine Months Ended September 30, 2024 
  

Prior to

  

Consolidated

     
  

Consolidation

  

Entities

  

As Reported

 

Total revenues

 $8,349  $(328) $8,021 

Operating loss

  (14,423)  (1,137)  (15,560)

Total other income, net

  66,050   1,066   67,116 

Income before noncontrolling interests

  40,048   93   40,141 

Income attributable to noncontrolling interests

  -   93   93 

Net income/(loss)

 $40,048  $-  $40,048 

 

 

 

 

  Nine Months Ended September 30, 2023 
  

Prior to

  

Consolidated

     
  

Consolidation

  

Entities

  

As Reported

 

Total revenues

 $7,378  $(331) $7,047 

Operating loss

  (10,998)  (1,127)  (12,125)

Total other income/(loss), net

  38,670   (1,530)  37,140 

Income before noncontrolling interests

  21,109   320   21,429 

Income attributable to noncontrolling interests

  -   320   320 

Net income/(loss)

 $21,109  $-  $21,109 

 

Variable Interest Entity

 

We have one investment partnership that is consolidated as a VIE as of September 30, 2024 and December 31, 2023 because AC is the primary beneficiary of the entity. With respect to the consolidated VIE, its assets may only be used to satisfy its obligations. The investors and creditors of the consolidated VIE have no recourse to the Company’s general assets. In addition, the Company neither benefits from such VIE’s assets nor bears the related risk beyond its beneficial interest in the VIE.

 

The following table presents the balances related to the VIE that is consolidated and included on the condensed consolidated statements of financial condition as well as the Company’s net interest in that VIE (in thousands):

 

  

September 30, 2024

  

December 31, 2023

 

Cash and cash equivalents

 $285  $302 

Investments in equity securities

  10,458   9,695 

Receivable from brokers

  22   166 

Accrued expenses and other liabilities

  (35)  (46)

Redeemable noncontrolling interests

  (472)  (451)

AC Group's net interest in consolidated VIE

 $10,258  $9,666 

 

 

Voting Interest Entity

 

We have one investment partnership that is consolidated as a VOE as of September 30, 2024 and December 31, 2023 because AC has a controlling interest in the entity. This resulted in the consolidation of $73.0 million of assets, $2.5 million of liabilities, and $5.4 million of redeemable noncontrolling interests at September 30, 2024 and $72.4 million of assets, $1.4 million of liabilities, and $5.6 million of redeemable noncontrolling interests at December 31, 2023. AC’s net interest in the consolidated VOE at September 30, 2024 and December 31, 2023 was $65.1 million and $65.4 million, respectively.  

 

Equity Method Investments

 

The Company’s equity method investments include investments in domestic partnerships and offshore funds. The Company evaluates each of its equity method investments to determine if any are significant as defined in the regulations applicable to smaller reporting companies promulgated by the SEC. As of and for the three and nine months ended September 30, 2024, no individual equity method investment held by the Company met the significance criteria. As such, the Company is not required to present summarized income statement information for any of its equity method investments. 

 

 
v3.24.3
Note 5 - Fair Value
 9 Months Ended
Sep. 30, 2024
Notes to Financial Statements  
Fair Value Disclosures [Text Block]

5.    Fair Value

 

Accounting Standards Codification Topic 820, Fair Value Measurement (ASC 820) specifies a hierarchy of valuation classifications based on whether the inputs to the valuation techniques used in each valuation classification are observable or unobservable. These classifications are summarized in the three broad levels listed below:

 

 

•

Level 1 - Unadjusted quoted prices for identical instruments in active markets.

 

•

Level 2 - Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable.

 

•

Level 3 - Valuations derived from valuation techniques in which significant inputs or significant value drivers are unobservable.

 

Inputs used to measure fair value might fall in different levels of the fair value hierarchy, in which case the Company defaults to the lowest level input that is significant to the fair value measurement in its entirety. These levels are not necessarily an indication of the risk or liquidity associated with the investments.

 

The following tables present assets and liabilities measured at fair value on a recurring basis, unless otherwise noted, as of the dates specified (in thousands):

 

  

September 30, 2024

 

Assets

 

Level 1

  

Level 2

  

Level 3

  

Total

 

Cash equivalents

 $259,247  $-  $-  $259,247 

Investments in securities (including GAMCO stock):

                

Trading - U.S. Treasury Bills

  115,829   -   -   115,829 

Common stocks

  242,017   822   2,035   244,874 

Mutual funds

  1,450   -   -   1,450 

Other

  2,571   648   126   3,345 

Total investments in securities

  361,867   1,470   2,161   365,498 

Investments in affiliated registered investment companies:

                

Closed-end funds - equity securities

  48,042   -   -   48,042 

Preferred securities issued by Closed-end funds (a)

  -   -   9,856   9,856 

Mutual funds

  82,457   -   -   82,457 

Total investments in affiliated registered investment companies

  130,499   -   9,856   140,355 

Total investments held at fair value

  492,366   1,470   12,017   505,853 

Total assets at fair value

 $751,613  $1,470  $12,017  $765,100 

Liabilities

                

Common stocks

 $6,838  $-  $-  $6,838 

Other

  35   503   -   538 

Securities sold, not yet purchased

  6,873   503   -   7,376 

Total liabilities at fair value

 $6,873  $503  $-  $7,376 

 

(a) These securities represent privately issued, puttable and callable preferred securities issued by affiliated closed-end funds.

 

 

  

December 31, 2023

 

Assets

 

Level 1

  

Level 2

  

Level 3

  

Total

 

Cash equivalents

 $315,017  $-  $-  $315,017 

Investments in securities (including GAMCO stock):

                

Trading - U.S. Treasury Bills

  89,155   -   -   89,155 

Common stocks

  187,963   1,348   2,035   191,346 

Mutual funds

  1,186   -   -   1,186 

Other

  3,347   485   219   4,051 

Total investments in securities

  281,651   1,833   2,254   285,738 

Investments in affiliated registered investment companies:

                

Closed-end funds - equity securities

  44,692   -   -   44,692 

Preferred securities issued by Closed-end funds (a)

  -   -   8,356   8,356 

Mutual funds

  73,703   -   -   73,703 

Total investments in affiliated registered investment companies

  118,395   -   8,356   126,751 

Total investments held at fair value

  400,046   1,833   10,610   412,489 

Total assets at fair value

 $715,063  $1,833  $10,610  $727,506 

Liabilities

                

Common stocks

 $5,035  $-  $-  $5,035 

Other

  579   304   -   883 

Securities sold, not yet purchased

  5,614   304   -   5,918 

Total liabilities at fair value

 $5,614  $304  $-  $5,918 

 

(a) These securities represent privately issued, puttable and callable preferred securities issued by affiliated closed-end funds.

 

The following table presents additional information about assets measured at fair value on a recurring basis and for which the Company has utilized Level 3 inputs to determine fair value:

 

  

Three Months Ended

  

Nine Months Ended

 
  

September 30,

  

September 30,

 

Assets:

 

2024

  

2023

  

2024

  

2023

 

Beginning balance

 $12,017  $14,491  $10,610  $13,774 

Total gains/(losses)

  -   (1)  100   (34)

Purchases

  -   -   3,900   1,000 

Sales/return of capital

  -   (880)  (2,593)  (1,130)

Ending balance

 $12,017  $13,610  $12,017  $13,610 

Changes in net unrealized gain/(loss) included in Net gain/(loss) from investments related to level 3 assets still held as of the reporting date

 $-  $(1) $100  $(34)

 

Total realized and unrealized gains and losses for Level 3 assets are reported in net gain/(loss) from investments in the condensed consolidated statements of income.

 

During the three and nine months ended September 30, 2024 and 2023, there were no transfers into or out of Level 3. 

 

The Company uses a discounted cash flow analysis when determining the fair value of privately issued preferred securities of affiliated closed-end funds that are categorized as Level 3. Projected cash flows in the discounted cash flow analysis represent the relevant security’s dividend rate plus the assumption of full principal repayment at the preferred security’s earliest available redemption date.

 

The significant unobservable input used in the fair value measurement of each of the Company’s investments in privately issued preferred securities of closed-end funds is the discount rate. The discount rate was determined using the interest rates of U.S. Treasury Bills that are held over a similar period as the preferred security. The discount rates used in the valuation of these investments as of September 30, 2024 ranged from 3.57% to 4.63% with a weighted average of 4.37% calculated based on the relative fair value. Significant changes in the discount rate could result in a significantly higher or lower fair value measurement of these Level 3 investments.

 

The Company uses the market approach as the valuation technique to value its investment in common stocks classified as Level 3, specifically considering recent transactions.

 

 
v3.24.3
Note 6 - Income Taxes
 9 Months Ended
Sep. 30, 2024
Notes to Financial Statements  
Income Tax Disclosure [Text Block]

6.    Income Taxes

 

The effective tax rate (“ETR”) for the nine months ended September 30, 2024 and  September 30, 2023 was 22.1% and 14.3%, respectively. The ETR in the year to date periods of 2024 and 2023 differ from the U.S. corporate tax rate of 21% primarily due to (a) deferred tax benefits from a foreign investment, (b) state and local taxes (net of federal benefit) and (c) the deductibility of officers' compensation. The increase in the ETR for the nine months ended September 30, 2024 was primarily due to deferred tax benefits from a foreign investment which reduced the prior year's rate.

 
v3.24.3
Note 7 - Earnings Per Share
 9 Months Ended
Sep. 30, 2024
Notes to Financial Statements  
Earnings Per Share [Text Block]

7.    Earnings per Share

 

Basic earnings per share is computed by dividing net income/(loss) attributable to our shareholders by the weighted average number of shares outstanding during the period. Diluted earnings per share is computed by dividing net income/(loss) attributable to our shareholders by the weighted average number of shares, plus any potentially dilutive securities (if any), outstanding during the period.

 

The computations of basic and diluted EPS are as follows (in thousands, except per share amounts):

 

  

Three Months Ended

  

Nine Months Ended

 
  

September 30,

  

September 30,

 
  

2024

  

2023

  

2024

  

2023

 

Net income/(loss) attributable to Associated Capital's shareholders

 $23,242  $(16) $40,048  $21,109 
                 

Weighted average number of shares outstanding - basic and diluted

  21,275   21,672   21,389   21,836 
                 

Basic and Diluted EPS

 $1.09  $0.00  $1.87  $0.97 

 
v3.24.3
Note 8 - Equity
 9 Months Ended
Sep. 30, 2024
Notes to Financial Statements  
Equity [Text Block]

8.    Equity

 

Voting Rights

 

The holders of Class A Common stock (“Class A Stock”) and Class B Common stock (“Class B Stock”) have identical rights except that holders of Class A Stock are entitled to one vote per share, while holders of Class B Stock are entitled to ten votes per share on all matters to be voted on by shareholders in general. Holders of each share class, however, are not eligible to vote on matters relating exclusively to the other share class.

 

Stock Award and Incentive Plan

 

The Company’s Board of Directors periodically grants shares of Phantom Restricted Stock awards (“Phantom RSAs”). Under the terms of the grants, the Phantom RSAs vest 30% and 70% after three and five years, respectively. The Phantom RSAs will be settled by a cash payment, net of applicable withholding tax, on the vesting dates. In addition, an amount equivalent to the cumulative dividends declared on shares of the Company’s Class A Stock during the vesting period will be paid to participants on vesting.

 

 

 

The Phantom RSAs are treated as a liability because cash settlement is required and compensation will be recognized over the vesting period. In determining the compensation expense to be recognized each period, the Company will re-measure the fair value of the liability at each reporting date taking into account the remaining vesting period attributable to each award and the current market value of the Company’s Class A Stock. In making these determinations, the Company will consider the impact of Phantom RSAs that have been forfeited prior to vesting (e.g., due to an employee termination). The Company has elected to consider forfeitures as they occur.

 

Based on the closing price of the Company’s Class A Stock on September 30, 2024 and December 31, 2023, the total liability recorded by the Company in compensation payable in our condensed consolidated statements of financial condition as of September 30, 2024 and December 31, 2023, with respect to the Phantom RSAs was $4.0 million and $3.5 million, respectively.

 

The following table summarizes our stock-based compensation as well as unrecognized compensation for the three and nine month periods ended  September 30, 2024 and 2023, respectively. Stock-based compensation expense is included in compensation expense in the condensed consolidated statements of income (dollars in thousands, unless otherwise noted):

 

  

Three Months Ended

  

Nine Months Ended

 
  

September 30,

  

September 30,

 
  

2024

  

2023

  

2024

  

2023

 
                 

Stock-based compensation expense

 $734  $752  $1,491  $957 
                 

Remaining expense to be recognized, if all vesting conditions are met(1)

          6,751   5,607 
                 

Weighted average remaining contractual term (in years)

          2.1   2.1 

 

(1) Does not include an estimate for projected future dividends.

 

The following table summarizes Phantom RSA ("PRSA") activity:

 

  

PRSAs

  Weighted Average Grant Date Fair Value 

Balance at December 31, 2023

  233,695  $37.38 

Granted

  -   - 

Forfeited

  -   - 

Vested

  -   - 

Balance at March 31, 2024

  233,695  $37.38 

Granted

  97,200   34.28 

Forfeited

  -   - 

Vested

  (27,300)  35.82 

Balance at June 30, 2024

  303,595  $36.53 

Granted

  -   - 

Forfeited

  (2,000)  36.95 

Vested

  -   - 

Balance at September 30, 2024

  301,595  $36.53 

 

Stock Repurchase Program

 

In December 2015, the Board of Directors established a stock repurchase program ("Stock Repurchase Program") authorizing the Company to repurchase up to 500,000 shares of Class A Stock. On February 7, 2017, the Board of Directors reset the available number of shares to be purchased under the stock repurchase program to 500,000 shares. On August 3, 2017 and May 8, 2018, the Board of Directors authorized the repurchase of an additional 1 million and 500,000 shares, respectively. On February 6, 2024, the Board of Directors authorized the repurchase of an additional 350,000 shares. On August 7, 2024, the Board of Directors authorized the repurchase of an additional 200,000 shares. Our stock repurchase program is not subject to an expiration date.

 

 

 

The following table presents the Company's repurchase activity with respect to its Class A Stock and remaining authorization:

 

 

For the three months ended September 30, 2024

 

Number of shares purchased

  

Average price per share

 

Remaining repurchase authorization June 30, 2024

  323,841     

Share repurchases under stock repurchase program (1)

  (107,218) $31.80 

Remaining repurchase authorization September 30, 2024 (2)

  416,623     

For the nine months ended September 30, 2024:

        

Remaining repurchase authorization December 31, 2023

  156,664     

Share repurchases under stock repurchase program (1)

  (290,041) $33.01 

Remaining repurchase authorization September 30, 2024 (2)

  416,623     

For the three months ended September 30, 2023:

        

Remaining repurchase authorization June 30, 2023

  345,175     

Share repurchases under stock repurchase program (1)

  (103,169) $36.98 

Remaining repurchase authorization September 30, 2023

  242,006     

For the nine months ended September 30, 2023:

        

Remaining repurchase authorization December 31, 2022

  609,352     

Share repurchases under stock repurchase program (1)

  (367,346) $36.43 

Remaining repurchase authorization September 30, 2023

  242,006     

 

(1) Repurchases totaled $3.4 million and $3.8 million for the three-months ended September 30, 2024 and 2023, respectively. Repurchases totaled $9.6 and $13.4 million for the nine months ended September 30, 2024 and 2023, respectively. 

(2) On February 6, 2024, the Board of Directors authorized the repurchase of an additional 350,000 shares. On August 7, 2024, the Board of Directors authorized the repurchase of an additional 200,000 shares.

 

Dividends

 

During the three and nine months ended September 30, 2024, the Company declared dividends of $2.00 per share and $2.10 per share, respectively, to Class A and Class B shareholders totaling $42.5 million and $44.6 million, respectively. The Company declared no dividends during the three month period ended September 30, 2023. For the nine months ended September 30, 2023, the Company declared dividends of $0.10 per share to Class A and Class B shareholders totaling $2.2 million.
v3.24.3
Note 9 - Goodwill
 9 Months Ended
Sep. 30, 2024
Notes to Financial Statements  
Goodwill Disclosure [Text Block]

9.    Goodwill

 

At September 30, 2024 and December 31, 2023, goodwill on the condensed consolidated statements of financial condition includes $3.4 million of goodwill related to GCIA. The Company assesses the recoverability of goodwill at least annually, or more often should events warrant, using a qualitative assessment of whether it is more likely than not that an impairment has occurred to determine if a quantitative analysis is required. There were no indicators of impairment for the three and nine months ended September 30, 2024 or 2023, and as such there was no impairment analysis performed or charge recorded.
v3.24.3
Note 10 - Guarantees, Contingencies and Commitments
 9 Months Ended
Sep. 30, 2024
Notes to Financial Statements  
Commitments and Contingencies Disclosure [Text Block]

10.    Guarantees, Contingencies and Commitments

 

From time to time, the Company may be named in legal actions and proceedings. These actions may seek substantial or indeterminate compensatory as well as punitive damages or injunctive relief. We are also subject to governmental or regulatory examinations or investigations. The examinations or investigations could result in adverse judgments, settlements, fines, injunctions, restitutions or other relief. For any such matters, the condensed consolidated financial statements include the necessary provisions for losses, if any, that the Company believes are probable and estimable. Furthermore, the Company evaluates whether losses exist which may be reasonably possible and will, if material, make the necessary disclosures. Management is not aware of any probable or reasonably possible losses.

 

The Company has also entered into arrangements with various other third parties, many of which provide for indemnification of the third parties against losses, costs, claims and liabilities arising from the performance of obligations under the agreements. The Company has had no claims or payments pursuant to these or prior agreements and believes the likelihood of a claim being made is remote, and, therefore, no accrual has been made on the condensed consolidated financial statements.
v3.24.3
Note 11 - Subsequent Events
 9 Months Ended
Sep. 30, 2024
Notes to Financial Statements  
Subsequent Events [Text Block]

11.    Subsequent Events

 

From October 1, 2024 to November 13, 2024, the Company repurchased 14,625 shares at an average price of $36.17 per share.

 

On November 8, 2024, the Board of Directors declared a dividend of $0.10 per share, which is payable on December 19, 2024 to Class A and Class B shareholders of record on December 5, 2024. 

 

 
v3.24.3
Insider Trading Arrangements
 9 Months Ended
Sep. 30, 2024
Insider Trading Arr Line Items  
Material Terms of Trading Arrangement [Text Block]

PART II:   Other Information
Rule 10b5-1 Arrangement Terminated [Flag] false
Rule 10b5-1 Arrangement Adopted [Flag] false
Non-Rule 10b5-1 Arrangement Terminated [Flag] false
Non-Rule 10b5-1 Arrangement Adopted [Flag] false
v3.24.3
Significant Accounting Policies (Policies)
 9 Months Ended
Sep. 30, 2024
Accounting Policies [Abstract]  
Organization [Policy Text Block]

Unless we have indicated otherwise, or the context otherwise requires, references in this report to “Associated Capital Group, Inc.”, "Associated Capital", “AC Group”, “the Company”, “AC”, “we”, “us” and “our” or similar terms are to Associated Capital Group, Inc., its predecessors and its subsidiaries.

 

We are a Delaware corporation that provides alternative investment management, and we derive investment income from proprietary investments of cash and other assets in our operating business.

 

Gabelli & Company Investment Advisors, Inc. (“GCIA”), a wholly-owned subsidiary of AC, and its wholly-owned subsidiary, Gabelli & Partners, LLC (“Gabelli & Partners”), collectively serve as general partners or investment managers to investment funds, including limited partnerships and offshore companies (collectively, “Investment Partnerships”) and separate accounts. We primarily manage assets across a range of risk and event arbitrage portfolios and in equity event-driven value strategies. The businesses earn management and incentive fees from their advisory activities. Management fees are largely based on a percentage of assets under management. Incentive fees are based on the percentage of the investment returns of certain clients’ portfolios. GCIA is an investment adviser registered with the Securities and Exchange Commission under the Investment Advisers Act of 1940, as amended.

 
Basis of Accounting, Policy [Policy Text Block]

Basis of Presentation

 

The unaudited interim condensed consolidated financial statements of AC Group included herein have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by GAAP in the United States for complete financial statements. The unaudited interim condensed consolidated financial statements reflect all adjustments, which are of a normal recurring nature, necessary for a fair presentation of financial position, results of operations and cash flows of the Company for the interim periods presented and are not necessarily indicative of a full year’s results. These interim condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2023.

 

The interim condensed consolidated financial statements include the accounts of AC Group and its subsidiaries. All intercompany transactions and balances have been eliminated. The details on the impact of consolidating certain partnership entities on the condensed consolidated financial statements can be seen in Note 4. Investment Partnerships and Other Entities.

 

For the three and nine months ended September 30, 2024 and 2023, there were no items related to other comprehensive income.

 
Use of Estimates, Policy [Policy Text Block]

Use of Estimates

 

The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported on the condensed consolidated financial statements and accompanying notes. Actual results could differ from those estimates.

 
New Accounting Pronouncements, Policy [Policy Text Block]

Recent Accounting Developments

 

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The amendments require disclosure of specific categories in the rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold and further disaggregation of income taxes paid for individually significant jurisdictions. The ASU is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. We are currently evaluating the impact of this guidance on the disclosures within our consolidated financial statements.

 

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280), which improves reportable segment disclosure requirements. The new standard will require enhanced disclosures about a public company’s significant segment expenses and more timely and detailed segment information reporting throughout the fiscal period, including for companies with a single reportable segment. The standard is effective for annual periods beginning after December 15, 2023 and interim periods beginning after December 15, 2024, and early adoption is permitted. We are currently evaluating the impact of this guidance on the disclosures within our consolidated financial statements.

 
v3.24.3
Note 2 - Revenue (Tables)
 9 Months Ended
Sep. 30, 2024
Notes Tables  
Disaggregation of Revenue [Table Text Block]
  Three Months Ended September 30,  Nine Months Ended September 30, 
  

2024

  

2023

  

2024

  

2023

 

Investment advisory and incentive fees

                

Asset-based advisory fees

 $1,175  $1,265  $3,619  $3,871 

Performance-based advisory fees

  48   1   49   2 

Sub-advisory fees

  1,087   832   4,038   2,916 

Total investment advisory and incentive fees

  2,310   2,098   7,706   6,789 
                 

Other

  105   102   315   258 
                 

Total revenues

 $2,415  $2,200  $8,021  $7,047 
v3.24.3
Note 3 - Investments in Securities (Tables)
 9 Months Ended
Sep. 30, 2024
Notes Tables  
Debt Securities, Trading, and Equity Securities, FV-NI [Table Text Block]
  

September 30, 2024

  

December 31, 2023

 
  

Cost

  

Fair Value

  

Cost

  

Fair Value

 

Debt - Trading Securities:

                

U.S. Treasury Bills

 $114,578  $115,829  $88,300  $89,155 

Equity Securities:

                

Common stocks

  229,350   244,874   198,269   191,346 

Mutual funds

  651   1,450   566   1,186 

Other investments

  4,164   3,345   5,166   4,051 

Total investments in equity securities

  234,165   249,669   204,001   196,583 

Total investments in securities

 $348,743  $365,498  $292,301  $285,738 
  

September 30, 2024

  

December 31, 2023

 
  

Cost

  

Fair Value

  

Cost

  

Fair Value

 
                 

Closed-end funds

 $39,924  $57,898  $39,680  $53,048 

Mutual funds

  54,898   82,457   50,136   73,703 

Total investments in affiliated registered investment companies

 $94,822  $140,355  $89,816  $126,751 
Security Sold Short [Table Text Block]
  

September 30, 2024

  

December 31, 2023

 
  

Cost

  

Fair Value

  

Cost

  

Fair Value

 
                 

Common stocks

 $6,604  $6,838  $5,227  $5,035 

Other investments

  114   538   631   883 

Total securities sold, not yet purchased

 $6,718  $7,376  $5,858  $5,918 
v3.24.3
Note 4 - Investment Partnerships and Other Entities (Tables)
 9 Months Ended
Sep. 30, 2024
Notes Tables  
Condensed Balance Sheet [Table Text Block]
  

September 30, 2024

 
  

Prior to

  

Consolidated

     

Assets

 

Consolidation

  

Entities

  

As Reported

 

Cash and cash equivalents

 $258,195  $2,673  $260,868 

Investments in U.S. Treasury Bills

  113,338   2,491   115,829 

Investments in equity securities

  183,191   66,478   249,669 

Investments in affiliated registered investment companies

  195,119   (54,764)  140,355 

Investments in partnerships

  159,717   (20,812)  138,905 

Receivable from brokers

  17,556   9,429   26,985 

Investment advisory fees receivable

  1,240   (7)  1,233 

Other assets(1)

  40,645   2,664   43,309 

Total assets

 $969,001  $8,152  $977,153 

Liabilities, redeemable noncontrolling interests and equity

            

Securities sold, not yet purchased

 $6,903  $473  $7,376 

Payable to brokers and other liabilities(1)

  26,787   1,843   28,630 

Dividends payable

  42,494   -   42,494 

Redeemable noncontrolling interests

  -   5,836   5,836 

Total equity

  892,817   -   892,817 

Total liabilities, redeemable noncontrolling interests and equity

 $969,001  $8,152  $977,153 
  

December 31, 2023

 
  

Prior to

  

Consolidated

     

Assets

 Consolidation  Entities  As Reported 

Cash and cash equivalents

 $299,508  $17,979  $317,487 

Investments in U.S. Treasury Bills

  79,714   9,441   89,155 

Investments in equity securities

  149,154   47,429   196,583 

Investments in affiliated registered investment companies

  181,641   (54,890)  126,751 

Investments in partnerships

  163,226   (20,252)  142,974 

Receivable from brokers(1)

  25,026   5,242   30,268 

Investment advisory fees receivable

  4,714   (3)  4,711 

Other assets(1)

  33,444   2,424   35,868 

Total assets

 $936,427  $7,370  $943,797 

Liabilities, redeemable noncontrolling interests and equity

            

Securities sold, not yet purchased

 $5,639  $279  $5,918 

Payable to brokers and other liabilities(1)

  23,813   988   24,801 

Redeemable noncontrolling interests

  -   6,103   6,103 

Total equity

  906,975   -   906,975 

Total liabilities, redeemable noncontrolling interests and equity

 $936,427  $7,370  $943,797 
Condensed Income Statement [Table Text Block]
  Three Months Ended September 30, 2024 
  

Prior to

  

Consolidated

     
  

Consolidation

  

Entities

  

As Reported

 

Total revenues

 $2,527  $(112) $2,415 

Operating loss

  (6,545)  (371)  (6,916)

Total other income, net

  36,353   886   37,239 

Income before noncontrolling interests

  23,242   148   23,390 

Income attributable to noncontrolling interests

  -   148   148 

Net income/(loss)

 $23,242  $-  $23,242 
  Three Months Ended September 30, 2023 
  

Prior to

  

Consolidated

     
  

Consolidation

  

Entities

  

As Reported

 

Total revenues

 $2,310  $(110) $2,200 

Operating loss

  (3,156)  (365)  (3,521)

Total other income, net

  3,044   750   3,794 

Income/(loss) before noncontrolling interests

  (16)  123   107 

Income attributable to noncontrolling interests

  -   123   123 

Net income/(loss)

 $(16) $-  $(16)
  Nine Months Ended September 30, 2024 
  

Prior to

  

Consolidated

     
  

Consolidation

  

Entities

  

As Reported

 

Total revenues

 $8,349  $(328) $8,021 

Operating loss

  (14,423)  (1,137)  (15,560)

Total other income, net

  66,050   1,066   67,116 

Income before noncontrolling interests

  40,048   93   40,141 

Income attributable to noncontrolling interests

  -   93   93 

Net income/(loss)

 $40,048  $-  $40,048 
  Nine Months Ended September 30, 2023 
  

Prior to

  

Consolidated

     
  

Consolidation

  

Entities

  

As Reported

 

Total revenues

 $7,378  $(331) $7,047 

Operating loss

  (10,998)  (1,127)  (12,125)

Total other income/(loss), net

  38,670   (1,530)  37,140 

Income before noncontrolling interests

  21,109   320   21,429 

Income attributable to noncontrolling interests

  -   320   320 

Net income/(loss)

 $21,109  $-  $21,109 
Schedule of Variable Interest Entities [Table Text Block]
  

September 30, 2024

  

December 31, 2023

 

Cash and cash equivalents

 $285  $302 

Investments in equity securities

  10,458   9,695 

Receivable from brokers

  22   166 

Accrued expenses and other liabilities

  (35)  (46)

Redeemable noncontrolling interests

  (472)  (451)

AC Group's net interest in consolidated VIE

 $10,258  $9,666 
v3.24.3
Note 5 - Fair Value (Tables)
 9 Months Ended
Sep. 30, 2024
Notes Tables  
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block]
  

September 30, 2024

 

Assets

 

Level 1

  

Level 2

  

Level 3

  

Total

 

Cash equivalents

 $259,247  $-  $-  $259,247 

Investments in securities (including GAMCO stock):

                

Trading - U.S. Treasury Bills

  115,829   -   -   115,829 

Common stocks

  242,017   822   2,035   244,874 

Mutual funds

  1,450   -   -   1,450 

Other

  2,571   648   126   3,345 

Total investments in securities

  361,867   1,470   2,161   365,498 

Investments in affiliated registered investment companies:

                

Closed-end funds - equity securities

  48,042   -   -   48,042 

Preferred securities issued by Closed-end funds (a)

  -   -   9,856   9,856 

Mutual funds

  82,457   -   -   82,457 

Total investments in affiliated registered investment companies

  130,499   -   9,856   140,355 

Total investments held at fair value

  492,366   1,470   12,017   505,853 

Total assets at fair value

 $751,613  $1,470  $12,017  $765,100 

Liabilities

                

Common stocks

 $6,838  $-  $-  $6,838 

Other

  35   503   -   538 

Securities sold, not yet purchased

  6,873   503   -   7,376 

Total liabilities at fair value

 $6,873  $503  $-  $7,376 
  

December 31, 2023

 

Assets

 

Level 1

  

Level 2

  

Level 3

  

Total

 

Cash equivalents

 $315,017  $-  $-  $315,017 

Investments in securities (including GAMCO stock):

                

Trading - U.S. Treasury Bills

  89,155   -   -   89,155 

Common stocks

  187,963   1,348   2,035   191,346 

Mutual funds

  1,186   -   -   1,186 

Other

  3,347   485   219   4,051 

Total investments in securities

  281,651   1,833   2,254   285,738 

Investments in affiliated registered investment companies:

                

Closed-end funds - equity securities

  44,692   -   -   44,692 

Preferred securities issued by Closed-end funds (a)

  -   -   8,356   8,356 

Mutual funds

  73,703   -   -   73,703 

Total investments in affiliated registered investment companies

  118,395   -   8,356   126,751 

Total investments held at fair value

  400,046   1,833   10,610   412,489 

Total assets at fair value

 $715,063  $1,833  $10,610  $727,506 

Liabilities

                

Common stocks

 $5,035  $-  $-  $5,035 

Other

  579   304   -   883 

Securities sold, not yet purchased

  5,614   304   -   5,918 

Total liabilities at fair value

 $5,614  $304  $-  $5,918 
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block]
  

Three Months Ended

  

Nine Months Ended

 
  

September 30,

  

September 30,

 

Assets:

 

2024

  

2023

  

2024

  

2023

 

Beginning balance

 $12,017  $14,491  $10,610  $13,774 

Total gains/(losses)

  -   (1)  100   (34)

Purchases

  -   -   3,900   1,000 

Sales/return of capital

  -   (880)  (2,593)  (1,130)

Ending balance

 $12,017  $13,610  $12,017  $13,610 

Changes in net unrealized gain/(loss) included in Net gain/(loss) from investments related to level 3 assets still held as of the reporting date

 $-  $(1) $100  $(34)
v3.24.3
Note 7 - Earnings Per Share (Tables)
 9 Months Ended
Sep. 30, 2024
Notes Tables  
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]
  

Three Months Ended

  

Nine Months Ended

 
  

September 30,

  

September 30,

 
  

2024

  

2023

  

2024

  

2023

 

Net income/(loss) attributable to Associated Capital's shareholders

 $23,242  $(16) $40,048  $21,109 
                 

Weighted average number of shares outstanding - basic and diluted

  21,275   21,672   21,389   21,836 
                 

Basic and Diluted EPS

 $1.09  $0.00  $1.87  $0.97 
v3.24.3
Note 8 - Equity (Tables)
 9 Months Ended
Sep. 30, 2024
Notes Tables  
Share-Based Payment Arrangement, Cost by Plan [Table Text Block]
  

Three Months Ended

  

Nine Months Ended

 
  

September 30,

  

September 30,

 
  

2024

  

2023

  

2024

  

2023

 
                 

Stock-based compensation expense

 $734  $752  $1,491  $957 
                 

Remaining expense to be recognized, if all vesting conditions are met(1)

          6,751   5,607 
                 

Weighted average remaining contractual term (in years)

          2.1   2.1 
Share-Based Payment Arrangement, Activity [Table Text Block]
  

PRSAs

  Weighted Average Grant Date Fair Value 

Balance at December 31, 2023

  233,695  $37.38 

Granted

  -   - 

Forfeited

  -   - 

Vested

  -   - 

Balance at March 31, 2024

  233,695  $37.38 

Granted

  97,200   34.28 

Forfeited

  -   - 

Vested

  (27,300)  35.82 

Balance at June 30, 2024

  303,595  $36.53 

Granted

  -   - 

Forfeited

  (2,000)  36.95 

Vested

  -   - 

Balance at September 30, 2024

  301,595  $36.53 
Class of Treasury Stock [Table Text Block]

For the three months ended September 30, 2024

 

Number of shares purchased

  

Average price per share

 

Remaining repurchase authorization June 30, 2024

  323,841     

Share repurchases under stock repurchase program (1)

  (107,218) $31.80 

Remaining repurchase authorization September 30, 2024 (2)

  416,623     

For the nine months ended September 30, 2024:

        

Remaining repurchase authorization December 31, 2023

  156,664     

Share repurchases under stock repurchase program (1)

  (290,041) $33.01 

Remaining repurchase authorization September 30, 2024 (2)

  416,623     

For the three months ended September 30, 2023:

        

Remaining repurchase authorization June 30, 2023

  345,175     

Share repurchases under stock repurchase program (1)

  (103,169) $36.98 

Remaining repurchase authorization September 30, 2023

  242,006     

For the nine months ended September 30, 2023:

        

Remaining repurchase authorization December 31, 2022

  609,352     

Share repurchases under stock repurchase program (1)

  (367,346) $36.43 

Remaining repurchase authorization September 30, 2023

  242,006     
v3.24.3
Supplemental Disclosure of Non-cash Activity (Details Textual) - USD ($)
$ / shares in Units, $ in Thousands
 3 Months Ended 9 Months Ended
Sep. 30, 2024
Sep. 30, 2024
Sep. 30, 2023
Dec. 31, 2023
Common Stock, Dividends, Per Share, Declared (in dollars per share) $ 2 $ 2.1 $ 0.1  
Dividends Payable $ 42,494 $ 42,494   $ 0
Common Class A [Member]        
Common Stock, Dividends, Per Share, Declared (in dollars per share) $ 2 $ 2.1 0.1  
Common Class B [Member]        
Common Stock, Dividends, Per Share, Declared (in dollars per share) $ 2 $ 2.1 $ 0.1  
v3.24.3
Note 2 - Revenue - Disaggregation of Revenue (Details) - USD ($)
$ in Thousands
 3 Months Ended 9 Months Ended
Sep. 30, 2024
Sep. 30, 2023
Sep. 30, 2024
Sep. 30, 2023
Total revenues $ 2,415 $ 2,200 $ 8,021 $ 7,047
Asset Based Advisory Fees [Member]        
Total revenues 1,175 1,265 3,619 3,871
Performance Based Advisory Fees [Member]        
Total revenues 48 1 49 2
Sub Advisory Fees [Member]        
Total revenues 1,087 832 4,038 2,916
Investment Advice [Member]        
Total revenues 2,310 2,098 7,706 6,789
Other Miscellaneous Revenues [Member]        
Total revenues $ 105 $ 102 $ 315 $ 258
v3.24.3
Note 3 - Investments in Securities (Details Textual)
$ / shares in Units, shares in Millions, $ in Millions
Sep. 30, 2024
USD ($)
$ / shares
shares
Dividends Receivable | $ $ 4.6
Investment Owned, Balance, Shares (in shares) | shares 2.3
GAMCO Investors [Member]  
Dividends Payable, Amount Per Share (in dollars per share) | $ / shares $ 2
v3.24.3
Note 3 - Investments in Securities - Investments in Securities (Details) - USD ($)
$ in Thousands
Sep. 30, 2024
Dec. 31, 2023
Investments in U.S. Treasury Bills with maturities greater than 3 months $ 115,829 $ 89,155
Equity Securities 234,165 204,001
Investments in equity securities 249,669 196,583
Total investments in securities 348,743 292,301
Total investments in securities, fair value 365,498 285,738
Investment, Affiliated Issuer [Member]    
Investment in registered investment companies, cost 94,822 89,816
Investments in affiliated registered investment companies, fair value 140,355 126,751
Closed End Funds [Member] | Investment, Affiliated Issuer [Member]    
Investment in registered investment companies, cost 39,924 39,680
Investments in affiliated registered investment companies, fair value 57,898 53,048
US Treasury Bill Securities [Member]    
U.S. Treasury Bills 114,578 88,300
Investments in U.S. Treasury Bills with maturities greater than 3 months 115,829 89,155
Mutual Fund [Member]    
Equity Securities 651 566
Investments in equity securities 1,450 1,186
Mutual Fund [Member] | Investment, Affiliated Issuer [Member]    
Investment in registered investment companies, cost 54,898 50,136
Investments in affiliated registered investment companies, fair value 82,457 73,703
Common Stock [Member]    
Equity Securities 229,350 198,269
Investments in equity securities 244,874 191,346
Other Investments [Member]    
Equity Securities 4,164 5,166
Investments in equity securities $ 3,345 $ 4,051
v3.24.3
Note 3 - Investments in Securities - Securities Sold, Not Yet Purchased (Details) - USD ($)
$ in Thousands
Jun. 30, 2024
Dec. 31, 2023
Total securities sold, not yet purchased, cost $ 6,718 $ 5,858
Total securities sold, not yet purchased, fair value 7,376 5,918
Common Stock [Member]    
Total securities sold, not yet purchased, cost 6,604 5,227
Total securities sold, not yet purchased, fair value 6,838 5,035
Other Investments [Member]    
Total securities sold, not yet purchased, cost 114 631
Total securities sold, not yet purchased, fair value $ 538 $ 883
v3.24.3
Note 4 - Investment Partnerships and Other Entities (Details Textual) - USD ($)
$ in Thousands
 9 Months Ended
Sep. 30, 2024
Dec. 31, 2023
Investments in and Advance to Affiliates, Subsidiaries, Associates, and Joint Ventures $ 99,100 $ 107,400
Investments in Unaffiliated Entities 39,800 35,600
Assets 977,153 943,797
Liabilities 78,500 30,719
Redeemable Noncontrolling Interest, Equity, Carrying Amount 5,836 6,103
Net Assets 10,258 9,666
Voting Interest Entities [Member]    
Assets 73,000 72,400
Liabilities 2,500 1,400
Redeemable Noncontrolling Interest, Equity, Carrying Amount 5,400 5,600
Net Assets $ 65,100 $ 65,400
Minimum [Member]    
Notice Period for Redeeming Investments in Unaffiliated Entities (Day) 30 days  
Maximum [Member]    
Notice Period for Redeeming Investments in Unaffiliated Entities (Day) 95 days  
v3.24.3
Note 4 - Investment Partnerships and Other Entities - Net Impact of the Consolidated Investment Partnerships and Other Entities on the Statements of Financial Condition (Details) - USD ($)
$ in Thousands
Sep. 30, 2024
Jun. 30, 2024
Dec. 31, 2023
Sep. 30, 2023
Jun. 30, 2023
Dec. 31, 2022
Cash and cash equivalents (includes U.S. Treasury Bills with maturities of 3 months or less) $ 260,868   $ 317,487 $ 381,253    
Investments in U.S. Treasury Bills 115,829   89,155      
Investments in equity securities 249,669   196,583      
Investments in affiliated registered investment companies 140,355   126,751      
Investments in partnerships 138,905   142,974      
Receivable from brokers 26,985   30,268      
Investment advisory fees receivable 1,233   4,711      
Other assets [1] 43,309   35,868      
Total assets 977,153   943,797      
Securities sold, not yet purchased 7,376   5,918      
Payable to brokers and other liabilities(1) 28,630   24,801      
Dividend payable 42,494   0      
Redeemable noncontrolling interests 5,836   6,103      
Total equity 892,817 $ 915,479 906,975 $ 895,736 $ 899,567 $ 890,196
Total liabilities, redeemable noncontrolling interests and equity 977,153   943,797      
Consolidated Entity, Excluding Consolidated Entities [Member]            
Cash and cash equivalents (includes U.S. Treasury Bills with maturities of 3 months or less) 258,195   299,508      
Investments in U.S. Treasury Bills 113,338   79,714      
Investments in equity securities 183,191   149,154      
Investments in affiliated registered investment companies 195,119   181,641      
Investments in partnerships 159,717   163,226      
Receivable from brokers 17,556   25,026      
Investment advisory fees receivable 1,240   4,714      
Other assets [1] 40,645   33,444      
Total assets 969,001   936,427      
Securities sold, not yet purchased 6,903   5,639      
Payable to brokers and other liabilities(1) [1] 26,787   23,813      
Dividend payable 42,494          
Redeemable noncontrolling interests 0   0      
Total equity 892,817   906,975      
Total liabilities, redeemable noncontrolling interests and equity 969,001   936,427      
Consolidated Entities [Member]            
Cash and cash equivalents (includes U.S. Treasury Bills with maturities of 3 months or less) 2,673   17,979      
Investments in U.S. Treasury Bills 2,491   9,441      
Investments in equity securities 66,478   47,429      
Investments in affiliated registered investment companies (54,764)   (54,890)      
Investments in partnerships (20,812)   (20,252)      
Receivable from brokers 9,429   5,242      
Investment advisory fees receivable (7)   (3)      
Other assets [1] 2,664   2,424      
Total assets 8,152   7,370      
Securities sold, not yet purchased 473   279      
Payable to brokers and other liabilities(1) 1,843   988      
Dividend payable 0          
Redeemable noncontrolling interests 5,836   6,103      
Total equity 0   0      
Total liabilities, redeemable noncontrolling interests and equity $ 8,152   $ 7,370      
[1] Represents the summation of multiple captions from the condensed consolidated statements of financial condition.
v3.24.3
Note 4 - Investment Partnerships and Other Entities - Net Impact of Consolidated Entities on the Statements of Income (Details) - USD ($)
$ in Thousands
 3 Months Ended 9 Months Ended
Sep. 30, 2024
Sep. 30, 2023
Sep. 30, 2024
Sep. 30, 2023
Total revenues $ 2,415 $ 2,200 $ 8,021 $ 7,047
Operating loss (6,916) (3,521) (15,560) (12,125)
Total other income, net 37,239 3,794 67,116 37,140
Income before noncontrolling interests 23,390 107 40,141 21,429
Income attributable to noncontrolling interests 148 123 93 320
Net income/(loss) 23,242 (16) 40,048 21,109
Consolidated Entity, Excluding Consolidated Entities [Member]        
Total revenues 2,527 2,310 8,349 7,378
Operating loss (6,545) (3,156) (14,423) (10,998)
Total other income, net 36,353 3,044 66,050 38,670
Income before noncontrolling interests 23,242 (16) 40,048 21,109
Income attributable to noncontrolling interests 0 0 0 0
Net income/(loss) 23,242 (16) 40,048 21,109
Consolidated Entities [Member]        
Total revenues (112) (110) (328) (331)
Operating loss (371) (365) (1,137) (1,127)
Total other income, net 886 750 1,066 (1,530)
Income before noncontrolling interests 148 123 93 320
Income attributable to noncontrolling interests 148 123 93 320
Net income/(loss) $ 0 $ 0 $ 0 $ 0
v3.24.3
Note 4 - Investment Partnerships and Other Entities - Balances Related to VIEs (Details) - USD ($)
$ in Thousands
Sep. 30, 2024
Dec. 31, 2023
Sep. 30, 2023
Cash and cash equivalents $ 260,868 $ 317,487 $ 381,253
Investments in equity securities 249,669 196,583  
Receivable from brokers 26,985 30,268  
Redeemable noncontrolling interests (5,836) (6,103)  
AC Group's net interest in consolidated VIE 10,258 9,666  
Variable Interest Entity, Primary Beneficiary [Member]      
Cash and cash equivalents 285 302  
Investments in equity securities 10,458 9,695  
Receivable from brokers 22 166  
Accrued expenses and other liabilities [1] (35) (46)  
Redeemable noncontrolling interests $ (472) $ (451)  
[1] Represents the summation of multiple captions from the condensed consolidated statements of financial condition.
v3.24.3
Note 5 - Fair Value (Details Textual) - US Treasury Securities [Member] - Measurement Input, Discount Rate [Member]
Sep. 30, 2024
Minimum [Member]  
Debt Securities, Available-for-Sale, Measurement Input 3.57
Maximum [Member]  
Debt Securities, Available-for-Sale, Measurement Input 4.63
Weighted Average [Member]  
Debt Securities, Available-for-Sale, Measurement Input 4.37
v3.24.3
Note 5 - Fair Value - Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($)
$ in Thousands
Sep. 30, 2024
Dec. 31, 2023
Investments in U.S. Treasury Bills with maturities greater than 3 months $ 115,829 $ 89,155
Investments in equity securities 249,669 196,583
Total investments in securities 365,498 285,738
Securities sold, not yet purchased 7,376 5,918
US Treasury Bill Securities [Member]    
Investments in U.S. Treasury Bills with maturities greater than 3 months 115,829 89,155
Common Stock [Member]    
Investments in equity securities 244,874 191,346
Mutual Fund [Member]    
Investments in equity securities 1,450 1,186
Other Investments [Member]    
Investments in equity securities 3,345 4,051
Fair Value, Recurring [Member]    
Cash equivalents 259,247 315,017
Total investments in securities 365,498 285,738
Investments in affiliated registered investment companies 140,355 126,751
Investment, fair value 505,853 412,489
Total assets at fair value 765,100 727,506
Securities sold, not yet purchased 7,376 5,918
Total liabilities at fair value 7,376 5,918
Fair Value, Recurring [Member] | US Treasury Bill Securities [Member]    
Investments in U.S. Treasury Bills with maturities greater than 3 months 115,829 89,155
Fair Value, Recurring [Member] | Common Stock [Member]    
Investments in equity securities 244,874 191,346
Securities sold, not yet purchased 6,838 5,035
Fair Value, Recurring [Member] | Mutual Fund [Member]    
Investments in equity securities 1,450 1,186
Investments in affiliated registered investment companies 82,457 73,703
Fair Value, Recurring [Member] | Other Investments [Member]    
Investments in equity securities 3,345 4,051
Securities sold, not yet purchased 538 883
Fair Value, Recurring [Member] | Closed End Funds [Member]    
Investments in affiliated registered investment companies 48,042 44,692
Fair Value, Recurring [Member] | Preferred Securities From Closed End Funds [Member]    
Investments in affiliated registered investment companies 9,856 8,356
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 1 [Member]    
Cash equivalents 259,247 315,017
Total investments in securities 361,867 281,651
Investments in affiliated registered investment companies 130,499 118,395
Investment, fair value 492,366 400,046
Total assets at fair value 751,613 715,063
Securities sold, not yet purchased 6,873 5,614
Total liabilities at fair value 6,873 5,614
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | US Treasury Bill Securities [Member]    
Investments in U.S. Treasury Bills with maturities greater than 3 months 115,829 89,155
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | Common Stock [Member]    
Investments in equity securities 242,017 187,963
Securities sold, not yet purchased 6,838 5,035
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | Mutual Fund [Member]    
Investments in equity securities 1,450 1,186
Investments in affiliated registered investment companies 82,457 73,703
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | Other Investments [Member]    
Investments in equity securities 2,571 3,347
Securities sold, not yet purchased 35 579
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | Closed End Funds [Member]    
Investments in affiliated registered investment companies 48,042 44,692
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | Preferred Securities From Closed End Funds [Member]    
Investments in affiliated registered investment companies 0 0
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member]    
Cash equivalents 0 0
Total investments in securities 1,470 1,833
Investments in affiliated registered investment companies 0 0
Investment, fair value 1,470 1,833
Total assets at fair value 1,470 1,833
Securities sold, not yet purchased 503 304
Total liabilities at fair value 503 304
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | US Treasury Bill Securities [Member]    
Investments in U.S. Treasury Bills with maturities greater than 3 months 0 0
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Common Stock [Member]    
Investments in equity securities 822 1,348
Securities sold, not yet purchased 0 0
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Mutual Fund [Member]    
Investments in equity securities 0 0
Investments in affiliated registered investment companies 0 0
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Other Investments [Member]    
Investments in equity securities 648 485
Securities sold, not yet purchased 503 304
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Closed End Funds [Member]    
Investments in affiliated registered investment companies 0 0
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Preferred Securities From Closed End Funds [Member]    
Investments in affiliated registered investment companies 0 0
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 3 [Member]    
Cash equivalents 0 0
Total investments in securities 2,161 2,254
Investments in affiliated registered investment companies 9,856 8,356
Investment, fair value 12,017 10,610
Total assets at fair value 12,017 10,610
Securities sold, not yet purchased 0 0
Total liabilities at fair value 0 0
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | US Treasury Bill Securities [Member]    
Investments in U.S. Treasury Bills with maturities greater than 3 months 0 0
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | Common Stock [Member]    
Investments in equity securities 2,035 2,035
Securities sold, not yet purchased 0 0
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | Mutual Fund [Member]    
Investments in equity securities 0 0
Investments in affiliated registered investment companies 0 0
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | Other Investments [Member]    
Investments in equity securities 126 219
Securities sold, not yet purchased 0 0
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | Closed End Funds [Member]    
Investments in affiliated registered investment companies 0 0
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | Preferred Securities From Closed End Funds [Member]    
Investments in affiliated registered investment companies $ 9,856 $ 8,356
v3.24.3
Note 5 - Fair Value - Additional Information About Assets Measured at Fair Value on a Recurring Basis (Details) - USD ($)
$ in Thousands
 3 Months Ended 9 Months Ended
Sep. 30, 2024
Sep. 30, 2023
Sep. 30, 2024
Sep. 30, 2023
Beginning balance $ 12,017 $ 14,491 $ 10,610 $ 13,774
Total gains/(losses) 0 (1) 100 (34)
Purchases 0 0 3,900 1,000
Sales/return of capital 0 (880) (2,593) (1,130)
Ending balance 12,017 13,610 12,017 13,610
Changes in net unrealized gain/(loss) included in Net gain/(loss) from investments related to level 3 assets still held as of the reporting date $ 0 $ (1) $ 100 $ (34)
v3.24.3
Note 6 - Income Taxes (Details Textual)
 9 Months Ended
Sep. 30, 2024
Sep. 30, 2023
Effective Income Tax Rate Reconciliation, Percent 22.10% 14.30%
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent 21.00%  
v3.24.3
Note 7 - Earnings Per Share - Computations of Basic and Diluted Earnings Per Share (Details) - USD ($)
$ / shares in Units, $ in Thousands
 3 Months Ended 9 Months Ended
Sep. 30, 2024
Sep. 30, 2023
Sep. 30, 2024
Sep. 30, 2023
Net income/(loss) attributable to Associated Capital's shareholders $ 23,242 $ (16) $ 40,048 $ 21,109
Weighted average number of shares outstanding - basic and diluted (in shares) 21,275 21,672 21,389 21,836
Basic (in dollars per share) $ 1.09 $ 0 $ 1.87 $ 0.97
v3.24.3
Note 8 - Equity (Details Textual)
$ / shares in Units, $ in Thousands
 3 Months Ended 6 Months Ended 9 Months Ended
Sep. 30, 2024
USD ($)
$ / shares
shares
Sep. 30, 2023
USD ($)
shares
Jun. 30, 2024
shares
Sep. 30, 2024
USD ($)
$ / shares
shares
Sep. 30, 2023
USD ($)
$ / shares
shares
Aug. 07, 2024
shares
Feb. 06, 2024
shares
Dec. 31, 2023
USD ($)
shares
Jun. 30, 2023
shares
Dec. 31, 2022
shares
May 08, 2018
shares
Aug. 03, 2017
shares
Feb. 07, 2017
shares
Dec. 31, 2015
shares
Employee-related Liabilities $ 17,488     $ 17,488       $ 15,169            
Stock Repurchase Program, Number of Shares Authorized to be Repurchased (in shares) | shares           200,000 350,000       500,000 1,000,000    
Stock Repurchase Program, Remaining Number of Shares Authorized to be Repurchased (in shares) | shares 416,623 [1] 242,006 323,841 416,623 [1] 242,006     156,664 345,175 609,352     500,000  
Treasury Stock, Value, Acquired, Cost Method $ 3,410 $ 3,815   $ 9,574 $ 13,381                  
Common Stock, Dividends, Per Share, Declared (in dollars per share) | $ / shares $ 2     $ 2.1 $ 0.1                  
Dividends $ 42,494 $ 0   $ 44,632 $ 2,188                  
Maximum [Member]                            
Stock Repurchase Program, Number of Shares Authorized to be Repurchased (in shares) | shares                           500,000
Phantom Restricted Stock Award [Member]                            
Employee-related Liabilities $ 4,000     $ 4,000       $ 3,500            
Phantom Restricted Stock Award [Member] | Share-Based Payment Arrangement, Tranche One [Member]                            
Share-Based Compensation Arrangement by Share-Based Payment Award, Award Vesting Rights, Percentage     30.00%                      
Share-Based Compensation Arrangement by Share-Based Payment Award, Award Vesting Period (Year)     3 years                      
Phantom Restricted Stock Award [Member] | Share-Based Payment Arrangement, Tranche Two [Member]                            
Share-Based Compensation Arrangement by Share-Based Payment Award, Award Vesting Rights, Percentage     70.00%                      
Share-Based Compensation Arrangement by Share-Based Payment Award, Award Vesting Period (Year)     5 years                      
Common Class A [Member]                            
Number of Votes Per Share     1                      
Common Stock, Dividends, Per Share, Declared (in dollars per share) | $ / shares $ 2     $ 2.1 $ 0.1                  
Common Class B [Member]                            
Number of Votes Per Share     10                      
Common Stock, Dividends, Per Share, Declared (in dollars per share) | $ / shares $ 2     $ 2.1 $ 0.1                  
[1] On February 6, 2024, the Board of Directors authorized the repurchase of an additional 350,000 shares.
v3.24.3
Note 8 - Equity - Summary of Stock-based Compensation and Unrecognized Compensation (Details) - Phantom Restricted Stock Award [Member] - USD ($)
$ in Thousands
 3 Months Ended 9 Months Ended
Sep. 30, 2024
Sep. 30, 2023
Sep. 30, 2024
Sep. 30, 2023
Stock-based compensation expense $ 734 $ 752 $ 1,491 $ 957
Remaining expense to be recognized, if all vesting conditions are met(1) [1] $ 6,751 $ 5,607 $ 6,751 $ 5,607
Weighted average remaining contractual term (in years) (Year)     2 years 1 month 6 days 2 years 1 month 6 days
[1] Does not include an estimate for projected future dividends.
v3.24.3
Note 8 - Equity - Phantom RSA Activity (Details) - Phantom Restricted Stock Award [Member] - $ / shares
 3 Months Ended
Sep. 30, 2024
Jun. 30, 2024
Mar. 31, 2024
Balance, shares (in shares) 303,595 233,695 233,695
Balance, weighted average grant date fair value (in dollars per share) $ 36.53 $ 37.38 $ 37.38
Granted, shares (in shares) 0 97,200 0
Granted, weighted average grant date fair value (in dollars per share) $ 0 $ 34.28 $ 0
Forfeited, shares (in shares) (2,000) 0 0
Forfeited, weighted average grant date fair value (in dollars per share) $ 36.95 $ 0 $ 0
Vested, shares (in shares) 0 (27,300) 0
Vested, weighted average grant date fair value (in dollars per share) $ 0 $ 35.82 $ 0
Balance, shares (in shares) 301,595 303,595 233,695
Balance, weighted average grant date fair value (in dollars per share) $ 36.53 $ 36.53 $ 37.38
v3.24.3
Note 8 - Equity - Stock Repurchase Activity (Details) - $ / shares
 3 Months Ended 9 Months Ended
Sep. 30, 2024
Sep. 30, 2023
Sep. 30, 2024
Sep. 30, 2023
Remaining repurchase authorization (in shares) 323,841 345,175 156,664 609,352
Share repurchases under stock repurchase program (1) (in shares) [1] (107,218) (103,169) (290,041) (367,346)
Share repurchases under stock repurchase program (1) (in dollars per share) [1] $ 31.8 $ 36.98 $ 33.01 $ 36.43
Remaining repurchase authorization (in shares) 416,623 [2] 242,006 416,623 [2] 242,006
[1] Repurchases totaled $2.2 million and $7.6 million for the three-month periods ended June 30, 2024 and 2023, respectively. Repurchases totaled $6.2 and $9.6 million for the six-month periods ended June 30, 2024 and 2023, respectively.
[2] On February 6, 2024, the Board of Directors authorized the repurchase of an additional 350,000 shares.
v3.24.3
Note 9 - Goodwill (Details Textual) - USD ($)
$ in Thousands
 3 Months Ended 9 Months Ended
Sep. 30, 2024
Sep. 30, 2023
Sep. 30, 2024
Sep. 30, 2023
Dec. 31, 2023
Goodwill $ 3,519   $ 3,519   $ 3,519
Goodwill, Impairment Loss 0 $ 0 0 $ 0  
Gabelli Company Investment Advisers Inc [Member]          
Goodwill $ 3,400   $ 3,400   $ 3,400
v3.24.3
Note 11 - Subsequent Events (Details Textual) - $ / shares
 1 Months Ended 3 Months Ended 9 Months Ended
Nov. 08, 2024
Nov. 13, 2024
Sep. 30, 2024
Sep. 30, 2023
Sep. 30, 2024
Sep. 30, 2023
Treasury Stock, Shares, Acquired (in shares) [1]     107,218 103,169 290,041 367,346
Shares Acquired, Average Cost Per Share (in dollars per share) [1]     $ 31.8 $ 36.98 $ 33.01 $ 36.43
Common Stock, Dividends, Per Share, Declared (in dollars per share)     2   2.1 0.1
Common Class A [Member]            
Common Stock, Dividends, Per Share, Declared (in dollars per share)     2   2.1 0.1
Common Class B [Member]            
Common Stock, Dividends, Per Share, Declared (in dollars per share)     $ 2   $ 2.1 $ 0.1
Subsequent Event [Member]            
Treasury Stock, Shares, Acquired (in shares)   14,625        
Shares Acquired, Average Cost Per Share (in dollars per share)   $ 36.17        
Subsequent Event [Member] | Common Class A [Member]            
Common Stock, Dividends, Per Share, Declared (in dollars per share) $ 0.1          
Subsequent Event [Member] | Common Class B [Member]            
Common Stock, Dividends, Per Share, Declared (in dollars per share) $ 0.1          
[1] Repurchases totaled $2.2 million and $7.6 million for the three-month periods ended June 30, 2024 and 2023, respectively. Repurchases totaled $6.2 and $9.6 million for the six-month periods ended June 30, 2024 and 2023, respectively.
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