DIAMOND HILL INVESTMENT GROUP, INC. REPORTS RESULTS FOR THIRD QUARTER 2024 AND DECLARES QUARTERLY DIVIDEND
COLUMBUS, Ohio, Nov. 4, 2024 /PRNewswire/ -- Diamond Hill Investment Group, Inc. (NASDAQ:DHIL) today reported unaudited financial results for the third quarter of 2024.
The following are selected highlights for the quarter ended September 30, 2024:
Assets under management ("AUM") and assets under advisement ("AUA") combined were $33.2 billion, compared to $29.2 billion as of December 31, 2023, and $26.6 billion as of September 30, 2023.
Average AUM and AUA combined were $32.4 billion, compared to $27.8 billion for the third quarter of 2023.
Net client outflows were $22.0 million, compared to $343.0 million of net outflows for the third quarter of 2023.
Revenue was $39.0 million, compared to $35.6 million for the third quarter of 2023.
Net operating profit margin was 26%, compared to 35% for the third quarter of 2023.
Adjusted net operating profit margin1 was 32%, compared to 33% for the third quarter of 2023.
Investment income was $9.7 million, compared to investment loss of $4.6 million for the third quarter of 2023.
Net income attributable to common shareholders was $14.6 million, compared to $6.5 million for the third quarter of 2023.
Earnings per share attributable to common shareholders - diluted was $5.35, compared to $2.20 for the third quarter of 2023.
Adjusted earnings per share attributable to common shareholders - diluted2 was $3.35, compared to $2.85 for the third quarter of 2023.
The Company returned approximately $7.5 million to its shareholders - $3.4 million through the repurchase of 22,376 common shares and $4.1 million through a dividend of $1.50 per common share.
"We continue making progress in diversifying our asset base, vehicle offerings and client types," said Heather Brilliant, CEO. "This is reflected in total fixed income assets reaching $5.5 billion in Q3, the recent launch of our Core Plus Bond Strategy and Securitized Credit Fund, which is offered as an interval fund. Both leverage our deep expertise in securitized assets and expand our ability to deliver great outcomes for a broader array of clients."
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1
Adjusts the financial measure calculated in accordance with U.S. generally accepted accounting principles ("GAAP") for the impact of market movements on the deferred compensation liability and related economic hedges, and the impact of any consolidated funds. During the third quarter of 2024, no Diamond Hill Funds were consolidated; during the third quarter of 2023, the Diamond Hill International Fund was consolidated. Each Diamond Hill Fund consolidated during the applicable period is referred to as a "Consolidated Fund." See the reconciliation to the comparable GAAP financial measure at the end of this earnings release.
2
Adjusts the financial measure calculated in accordance with GAAP for the impact of the Consolidated Fund(s) and investment income related to certain other investments. See the reconciliation to the comparable GAAP financial measure at the end of this earnings release.
Capital Allocation:
The Company's board of directors approved the payment of a regular quarterly cash dividend of $1.50 per common share. The dividend will be paid on December 6, 2024, to the Company's shareholders of record as of the close of business on November 22, 2024.
The Company's board of directors also approved a new repurchase plan, authorizing management to repurchase up to $50 million DHIL common shares in the open market and in private transactions in accordance with applicable securities laws. This new program will expire on November 4, 2026, or upon the earlier completion of all authorized purchases under the program.
Selected Income Statement Data
Three Months Ended September 30,
2024
2023
% Change
Revenue
$ 39,018,232
$ 35,554,280
10 %
Compensation and related costs, excluding deferred compensation expense (benefit)
19,509,116
17,837,787
9 %
Deferred compensation expense (benefit)
2,250,168
(859,252)
NM
Other expenses
7,041,477
6,214,551
13 %
Total operating expenses
28,800,761
23,193,086
24 %
Net operating income
10,217,471
12,361,194
(17) %
Investment income (loss), net
9,668,961
(4,636,952)
NM
Net income before taxes
19,886,432
7,724,242
157 %
Income tax expense
(5,241,839)
(2,523,649)
108 %
Net income
14,644,593
5,200,593
182 %
Net income attributable to redeemable noncontrolling interest
—
1,272,839
NM
Net income attributable to common shareholders
$ 14,644,593
$ 6,473,432
126 %
Earnings per share attributable to common shareholders - diluted
$ 5.35
$ 2.20
143 %
Weighted average shares outstanding - diluted
2,738,588
2,939,055
(7) %
Nine Months Ended September 30,
2024
2023
% Change
Revenue
$ 111,974,495
$ 102,895,420
9 %
Compensation and related costs, excluding deferred compensation expense
55,987,247
51,600,045
9 %
Deferred compensation expense
4,571,396
1,867,983
145 %
Other expenses
20,762,944
18,338,448
13 %
Total operating expenses
81,321,587
71,806,476
13 %
Net operating income
30,652,908
31,088,944
(1) %
Investment income, net
18,380,048
9,722,494
89 %
Net income before taxes
49,032,956
40,811,438
20 %
Income tax expense
(13,246,590)
(11,338,849)
17 %
Net income
35,786,366
29,472,589
21 %
Net income attributable to redeemable noncontrolling interest
—
(859,126)
NM
Net income attributable to common shareholders
$ 35,786,366
$ 28,613,463
25 %
Earnings per share attributable to common shareholders - diluted
$ 12.90
$ 9.61
34 %
Weighted average shares outstanding - diluted
2,774,819
2,977,853
(7) %
Selected Assets Under Management and Assets Under Advisement Data
Change in AUM and AUA
For the Three Months Ended September 30,
(in millions)
2024
2023
AUM at beginning of the period
$ 29,291
$ 26,066
Net cash inflows (outflows)
Diamond Hill Funds
423
(260)
Separately managed accounts
(313)
(251)
Collective investment trusts
(23)
