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