Ladies and gentlemen, thank you for standing by. Welcome to BrightSphere Investment Group Earnings Conference Call and Webcast for the second quarter, 2024. During the call, all participants will be in a listen-only mode. After the presentation, we will conduct a question and answer session. To be added to the queue, please press * followed by the number 1 at any time during the call. If you need to reach an operator, press * followed by 0. Please note that this call is being recorded today, Thursday, August 1, 2024, at 11:00 A.M. Eastern Time. I would now like to turn the call over to Melody Wong, Senior Vice President, Director of Finance and Investor Relations. Please go ahead, Melody. Good morning, and welcome to BrightSphere's conference call to discuss our results for the second quarter ended June 30, 2024. Before we get started, please note that we may make forward-looking statements about our business and financial performance. Each forward-looking statement is subject to risks and uncertainties that could cause actual results to differ materially from those projected. Additional information regarding this risk and uncertainties appears in our SEC filings, including the Form 8-K filed today, containing the earnings release, our 2023 Form 10-K and our Form 10-Q for the first quarter of 2024. Any forward-looking statements that we make on this call are based on assumptions as of today, and we undertake no obligation to update them as a result of new information or future events. We may also reference certain non-GAAP financial measures. Information about any non-GAAP measures referenced, including the reconciliation of those measures to GAAP measures, can be found on our website, along with the slide set we will use as part of today's discussion. Finally, nothing herein shall be deemed to be an offer or solicitation to buy any investment products. Suren Rana, our President and Chief Executive Officer, will lead the call. Now I'm pleased to turn the call over to Suren Rana. Thank you, Melody. Good morning, everyone, and thanks for joining us today. I'll cover some of the main highlights on slide 5 of the deck in my initial remarks, and then I'm going to answer any questions. For the second quarter of 2024, we reported ENI per share of $0.45, compared to our $0.28 in the second quarter of 2023, and $0.44 in the first quarter of 2024. The 61% increase in ENI per share compared to the year-ago quarter was primarily driven by increase in management fee revenue due to higher AUM from the market appreciation that we saw over the last 12 months. And secondly, it was also driven by our share repurchases over the last few quarters. Our average AUM increased approximately 13% compared to the second quarter of 2023, and management fee revenue increased 14%, in line with the AUM increase. However, since we were able to keep our operating expenses generally flat year-over-year, our ENI increased 43% because of the 14% increase in revenue. This disproportionate increase in ENI versus revenue increase reflects our continued expense discipline and the embedded operating leverage in our business. We would expect to continue to benefit from this operating leverage as our revenue grows. Additionally, the increase in ENI per share versus year-ago was 61%, compared to the 43% increase in ENI that I just went through, and that difference was driven by our share repurchases over the last year. Between December 2023 and June 2024, we repurchased 4.7 million of our shares, or 11% of our total outstanding shares, for $100 million. Acadian's investment performance remained great. As of June 30, 2024, 86%, 92%, and 93% of Acadian strategies by revenue outperformed their respective benchmarks across 3-, 5-, and 10-year periods. Turning to flows. Net client cash flows were incidentally flat for the second quarter. In the second quarter, we had select large and lumpy inflows, but we also had select large and lumpy outflows, and these lumpy flows basically offset each other. Our growth initiatives continue to progress. On our systematic credit initiative, Acadian's U.S. High Yield Strategy that was seeded in November 2023, and the global high yield strategy, seeded more recently in April 2024, both continue to build good track records. Additionally, we just seeded a third credit strategy, U.S., investment grade strategy, in July 2024, and that strategy is also building a track record now. On our equity alternatives initiative, our multi-strategy fund, seeded in Q4 of 2022, continues to build a strong track record of our performance. Turning to capital management. As I mentioned earlier, we repurchased 11% of our outstanding shares since December of 2023 for $100 million. Specifically, in Q2 of 2024, we repurchased 0.9 million shares, or 2% of our total outstanding shares, for $21 million. At the end of second quarter, we had a cash balance of $72 million, and Acadian had an outstanding balance of $36 million on their revolving credit facility, which, similar to prior years, is expected to be repaid fully from cash from operations by year-end. I'd like to close my initial remarks by reiterating, as I usually do, that we remain focused on maximizing shareholder value, and will continue using our free cash flow to support organic growth and to buy back our shares. I'll now turn the call back to the operator, and I'm happy to answer questions at this point. Thank you. Thank you. And at this time, those with questions should lift their phone receiver and press star, followed by the number one on their telephone keypad to enter into the Q&A queue. To cancel a question, again, remember, please, please press star followed by the number one again. Please hold for a brief moment while we compile the Q&A roster. Our first question for today comes from the line of Michael Cyprys with Morgan Stanley. Your line is live. Great. Thank you. Good morning. Maybe just starting out with the lumpy flows that you alluded to on both the gross sales and the redemption side. I was hoping you could unpack both of those, maybe talk about some of the types of strategies, customer channels, et cetera, where you're seeing some of the strains come in, and if similarly on the redemption side, what you're seeing there, and if you could also just touch upon the pipeline as it looks today, how is that shaping up versus, say, last quarter? Thank you. Yeah, thanks, Michael. As we've touched on, ours is an institutional business, so some of the numbers can be large and they are episodic. So, if there weren't necessarily any patterns to unpack, it was just sort of coincidence, if you will, that we had these large numbers on both sides. On the inflows, it is really almost just three large clients that came in. There was a client that was more than $2 billion, another one for $1 billion, and another one close to $1 billion. So these really large numbers, and they were in assorted strategies. I wouldn't say there were any patterns to unpack in terms of any particular strategy. It was just that the strategies that these clients came in, they came in large numbers. And just, and it happened to be that these three large, you know, inflows happened to be in the same quarter. On the outflows side, similar story, that we had, really a large client, you know, a large client, close to $2 billion, another client, more than $1 billion, another client. So it was a similar number, different strategies that just happened to be in the same quarter. So it was quite sort of a quite a bit of a coincidence that it just all happened in one quarter. But yeah, yeah, it all sort of canceled each other out, so that's interesting. Going forward, if I guess that's sort of, you know, another part of your question. As we've sort of guided in the past few quarters, we see more of a break even to flat cadence, but we do have the pipeline remains healthy across stages. We have a good pipeline across different strategies and across different stages, and we still see some pressures from managed volatility strategies, among others. We see rebalancing going on by clients in these rising equity markets when they take some chips off the table. There are some clients that are moving to fixed income as a way to manage their, you know, profiling, the liability-driven investing. You know, all of those puts and takes, we think about a break-even kind of cadence for a few quarters here. Great, thanks. Just a follow-up question on capital allocation. Just curious how you're thinking about and planning to sort of approach that as we move it here in the second half and into 25. Cash balance, $72 million, I think you mentioned. You know, how should we think about that potentially drawing down, if at all? Just given, I know, in the past, I think you've mentioned you think about minimum cash level that you need to run the business is meaningfully lower than that. So, you know, what can we expect in terms of buybacks here as we go forward? Thank you. Yeah, thanks, Mike. Yeah, we think about minimum cash levels around $20 million or thereabout. So you could say that maybe they're close to $50 million for other uses. And as we've said, really the two main uses remain the buybacks and seeding opportunities to accelerate our organic growth. So we remain mindful and opportunistic on both of those fronts. We seeded just in this quarter, as we mentioned in the release, we seeded our third credit strategy, which was the U.S., investment grade strategy. So we have a sizable seed pool now, so there might be some recycling that happens within the pool. But still, if we get opportunities to seed more and to see opportunities for organic growth, we might do that. And we'll also look at the buybacks as we go. So there isn't any particular formula we have. We'll remain opportunistic on both. We don't feel like we necessarily have to buy back our shares every quarter, particularly as I touched on, that $50 million kind of a number, you know, it's not that much to put to work. So we'll just remain opportunistic here. Great. Thank you. Thank you for your question. Our next question is from the line of Kenneth Lee with RBC Capital Markets. Your line is live. Hey, good morning, and thanks for taking my question. Just one on the fee rate. There was, I think, a slight pickup in the fee in the quarter. Wondering whether it was just due to mix shift, and if so, were there any particularly higher fee rate products that contributed to the fee rate there? Thanks. Hi, Ken. Yeah, I think the answer was in the first part of your guess. Largely, you know, the mix does impact the fee rate a little bit, 'cause some of our strategies are higher fee and some are lower fee. So clearly, one of the factors was that the emerging markets indices in second quarter did relatively well. They had been lagging for a while. But in Q2, they did better than some of the other indices, EAFE and others. So and they have higher fees. So, that was part of, that was probably most of it and some other puts and takes. Gotcha. Thanks. And just one follow-up, if I may, just in terms of the share repurchases, capital allocation there. Would you expect to see a renewal of the board to renew the share repurchase authorization, you know, sometime in the near term? Thanks. Yeah. Thanks, Ken. Yeah, as I said, the uses for the capital remain are seeding organic growth opportunities and buybacks. As I said, the excess capital right now is not that much that is burning a hole in our pocket. So there isn't necessarily, you know, super urgency on that. But yeah, in due course, we'd expect to get new authorization for buybacks. Gotcha. Very helpful there. Thanks again. Thank you. Our next question is from the line of John Dunn with Evercore ISI. Your line is live. Thank you. Question on the outlook for further expense control from here, and your ability to keep expenses in check? Hi, John. Yeah, you know, as we talked about over the last couple of years, we had a lot of expense increases in the last couple of years, as we were really investing in our infrastructure. We invested in our trading infrastructure. We added to our investor reporting capabilities. So we were really building out a lot in the sense of making our franchise more scalable. So we have done a fair bit of that over the last couple of years, and at the same time, we also faced pressures from inflation on the cost of data and so the inflation was everywhere. So that's abated. So it appears that now, having built up a lot over the last couple of years and having faced the inflation, we are now in a good position to keep the expenses more or less at these levels, barring, of course, the general increases that you would see, sort of, cost of living type of increases, 2%-3% kind of levels. So that's what I touched on, that we do have the operating leverage as our revenue grows, either from market growth or organic growth. We should be able to keep the operating expenses relatively at these levels, so we should have disproportionate benefit as revenue increases. Got it. Maybe could you give us a little color on the conversations you're having with clients about maybe potentially a pickup in demand for emerging market strategies? Yeah. So, yeah, there are sort of a variety of opinions and depends on also the type of client. As you can imagine, many clients view that as sort of, you know, because there's always rotation in terms of highest performance markets, and emerging markets have been lagging for such a long time. So many clients view that as an opportunity and whose time may be coming soon, if you will. Just the levels of valuation overall in emerging markets, in China, in particular. So we're seeing that on the other hand, that there may be some clients who are a little bit worried about the geopolitical situation and worry about the risks, particularly... And then there are some political factors from state clients. So it's a mixed bag, but I think, you know, everything said and done, so far we haven't seen much of a pattern, either in terms of a lot of inflows or a lot of outflows. We are seeing inflows in that strategy, that it's a strategy that we really have excellent, very, very strong top performance. So if somebody does want to allocate, we would do and have really one of the best chances. And so we're seeing inflows in that strategy. We're also seeing some outflows. Thank you. Thank you for your question. Ladies and gentlemen, that will conclude our question and answer session for today. I would like to turn the conference call back over to Suren Rana. Thank you, operator. Thank you, everyone, for joining.