HAMILTON LANE INCORPORATED REPORTS THIRD QUARTER FISCAL 2024 RESULTS, WITH MANAGEMENT & ADVISORY FEES GROWING BY 17% AND ASSETS UNDER MANAGEMENT GROWING BY 12% YEAR-OVER-YEAR

Rhea-AI Summary

Hamilton Lane Incorporated (HLNE) reported strong third quarter fiscal 2024 results, with total assets under management growing 12% year-over-year to $120.0 billion. Fee-earning assets under management increased 15% to $63.1 billion, while management and advisory fees grew 17% to $113.6 million. The firm's unrealized carried interest balance was up 18% to approximately $1.1 billion, and GAAP EPS stood at $0.51 on $19.5 million of GAAP net income for the quarter. Hamilton Lane also declared a quarterly dividend of $0.445 per share, representing an 11% increase from the prior fiscal year dividend.

Insights

Financial Analyst

Hamilton Lane's report of a 12% year-over-year growth in assets under management (AUM) to $120 billion and a 15% increase in fee-earning assets to $63.1 billion, indicates a robust expansion in its asset base. This is a significant metric as AUM is directly tied to management and advisory fee revenue, which has also seen a 17% increase. This growth trajectory suggests a strong market position and effective asset acquisition strategies. The reported uptick in unrealized carried interest by 18% to approximately $1.1 billion is noteworthy, as it reflects potential future earnings, dependent on the realization of these investments. However, unrealized gains are subject to market volatility and thus represent a less stable component of future income.

The GAAP earnings per share (EPS) of $0.51 may offer a snapshot of profitability, but it's crucial to consider the underlying drivers such as investment performance, expense management and revenue growth. The declared dividend increase of 11% to $1.78 per share signals confidence in the firm's ability to generate cash flow and reward shareholders. It's important for stakeholders to assess dividend sustainability through payout ratios and free cash flow analysis.

Market Research Analyst

Hamilton Lane's emphasis on innovation and growth in private markets, as highlighted by Co-CEO Erik Hirsch, suggests a forward-looking strategy that could resonate with investors seeking exposure to alternative asset classes. The firm's performance in customized separate accounts, specialized funds and tech partnerships indicates a diversified business model that could mitigate risk and appeal to a broad investor base. The growth in AUM and revenue reflects not only market conditions but also operational effectiveness and competitive positioning within the asset management industry.

As private markets continue to attract institutional and retail investors, Hamilton Lane's progress in this space could be a barometer for the sector's health. The firm's expansion and strategic partnerships may also provide insights into emerging trends within private equity and alternative investments. Stakeholders should monitor the firm's ability to maintain momentum in a competitive landscape and continue delivering value through its specialized offerings.

Economist

The reported financial results of Hamilton Lane can be viewed in the context of broader economic trends. The increase in AUM and fee-earning assets is indicative of a favorable investment climate for private markets, which may be driven by investors' search for yield in a potentially low-interest-rate environment. The firm's financial health, as evidenced by revenue growth and a stable dividend policy, can serve as a microeconomic indicator of investor confidence and the demand for private market investments.

It is also essential to consider macroeconomic factors such as monetary policy, fiscal stimuli and market liquidity, which can impact the valuation of assets under management and the performance of the firm. The increase in carried interest suggests a positive outlook on future investment returns, but it must be weighed against potential economic headwinds that could affect asset valuations. For a holistic view, one must integrate these results with economic forecasts, industry trends and regulatory changes that could influence the firm's operations and profitability.

CONSHOHOCKEN, Pa., Feb. 6, 2024 /PRNewswire/ -- Leading private markets asset management firm Hamilton Lane Incorporated (Nasdaq: HLNE) today reported its results for the third fiscal quarter ended December 31, 2023.

THIRD QUARTER FISCAL 2024 HIGHLIGHTS

• Assets under management – Total assets under management of $120.0 billion grew 12% year-over-year. Fee-earning assets under management increased 15% to $63.1 billion over the same period.
  
  
• Revenue – Management and advisory fees of $113.6 million for the quarter represent growth of 17% versus the prior year period.
  
  
• Carried Interest – Unrealized carried interest balance of approximately $1.1 billion was up 18% versus the prior year period.
  
  
• Earnings per share – GAAP EPS of $0.51 on $19.5 million of GAAP net income for the quarter.
  
  
• Dividend – Declared a quarterly dividend of $0.445 per share of Class A common stock to record holders at the close of business on March 15, 2024 that will be paid on April 4, 2024. The target full-year dividend of $1.78 represents an 11% increase from the prior fiscal year dividend.

Hamilton Lane issued a full detailed presentation of its third quarter fiscal 2024 results, which can be accessed by clicking here.

Hamilton Lane Co-CEO Erik Hirsch commented: "Our commitment to excellence, innovation, and growth in the private markets has resulted in another strong quarter for Hamilton Lane. Calendar 2023 was a tremendous year for the firm across our customized separate accounts, specialized funds and tech partnerships, and we look forward to what lies ahead for 2024." 

Conference Call
Hamilton Lane will discuss third quarter fiscal 2024 results in a webcast and conference call today, Tuesday, February 6, 2024, at 11:00 a.m. Eastern Time.

For access to the live event via the webcast, visit Hamilton Lane's Shareholders website by clicking here at least 15 minutes prior to the start of the call. This feature will be in listen-only mode.

A replay of the webcast will be available approximately two hours after the live broadcast for a period of one year and can be accessed in the same manner as the live webcast at the Shareholders page of Hamilton Lane's website.

About Hamilton Lane
Hamilton Lane (Nasdaq: HLNE) is one of the largest private markets investment firms globally, providing innovative solutions to institutional and private wealth investors around the world. Dedicated exclusively to private markets investing for more than 30 years, the firm currently employs nearly 700 professionals operating in offices throughout North America, Europe, Asia Pacific and the Middle East. Hamilton Lane has $902.8 billion in assets under management and supervision, composed of $120.0 billion in discretionary assets and $782.9 billion in non-discretionary assets, as of December 31, 2023. Hamilton Lane specializes in building flexible investment programs that provide clients access to the full spectrum of private markets strategies, sectors and geographies. For more information, please visit https://www.hamiltonlane.com/en-us or follow Hamilton Lane on LinkedIn: https://www.linkedin.com/company/hamilton-lane/. 

Forward-Looking Statements
Some of the statements in this release may constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995. Words such as "will," "expect," "believe," "estimate," "continue," "anticipate," "intend," "plan" and similar expressions are intended to identify these forward-looking statements. Forward-looking statements discuss management's current expectations and projections relating to our financial position, results of operations, plans, objectives, future performance and business. All forward-looking statements are subject to known and unknown risks, uncertainties and other important factors that may cause actual results to be materially different, including risks relating to: our ability to manage growth, fund performance, competition in our industry, changes in our regulatory environment and tax status; market conditions generally; our ability to access suitable investment opportunities for our clients; our ability to maintain our fee structure; our ability to attract and retain key employees; our ability to manage our obligations under our debt agreements; defaults by clients and third-party investors on their obligations to fund commitments; our exposure and that of our clients and investors to the credit risks of financial institutions at which we and they hold accounts; our ability to comply with investment guidelines set by our clients; our ability to successfully integrate acquired businesses with ours; our ability to manage risks associated with introducing new types of investment structures, products or services or entering into strategic partnerships; our ability to manage redemption or repurchase rights in certain of our funds; our ability to manage, identify and anticipate risks we face; our ability to manage the effects of events outside of our control; and our ability to receive distributions from Hamilton Lane Advisors, L.L.C. to fund our payment of dividends, taxes and other expenses.

The foregoing list of factors is not exhaustive.  For more information regarding these risks and uncertainties as well as additional risks we face, you should refer to the "Risk Factors" detailed in Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended March 31, 2023 and in our subsequent reports filed from time to time with the Securities and Exchange Commission. The forward-looking statements included in this release are made only as of the date hereof. We undertake no obligation to update or revise any forward-looking statement as a result of new information or future events, except as otherwise required by law.

 

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SOURCE Hamilton Lane

FAQ

What were Hamilton Lane Incorporated's (HLNE) total assets under management for the third quarter fiscal 2024?

Hamilton Lane's total assets under management grew 12% year-over-year to $120.0 billion.

How much did the fee-earning assets under management increase for Hamilton Lane Incorporated (HLNE) in the third quarter fiscal 2024?

Fee-earning assets under management increased 15% to $63.1 billion over the same period.

What was the growth percentage in management and advisory fees for Hamilton Lane Incorporated (HLNE) in the third quarter fiscal 2024?

Management and advisory fees grew 17% to $113.6 million for the quarter.

What was the percentage increase in Hamilton Lane Incorporated's (HLNE) unrealized carried interest balance for the third quarter fiscal 2024?

The unrealized carried interest balance was up 18% versus the prior year period, reaching approximately $1.1 billion.

What was Hamilton Lane Incorporated's (HLNE) GAAP EPS and net income for the third quarter fiscal 2024?

GAAP EPS stood at $0.51 on $19.5 million of GAAP net income for the quarter.

What was the quarterly dividend declared by Hamilton Lane Incorporated (HLNE) for the third quarter fiscal 2024?

Hamilton Lane declared a quarterly dividend of $0.445 per share of Class A common stock, representing an 11% increase from the prior fiscal year dividend.