JHG - Janus Henderson Group plc (JHG) Q4 2023 Earnings Call Transcript
2024-02-01 13:49:05 ET
Janus Henderson Group plc (JHG)
Q4 2023 Earnings Conference Call
February 1, 2024 9:00 AM ET
Company Participants
Ali Dibadj – Chief Executive Officer
Roger Thompson – Chief Financial Officer
Conference Call Participants
Dan Fannon – Jefferies
Craig Siegenthaler – Bank of America Merrill Lynch
Ken Worthington – JPMorgan
Patrick Davitt – Autonomous Research
Michael Cyprys – Morgan Stanley
Adam Beatty – UBS
Brian Bedell – Deutsche Bank
John Dunn – Evercore ISI
Bill Katz – TD Cowen
Presentation
Operator
Good morning. My name is Jordan and I'll be your conference facilitator today. Thank you for standing by and welcome to the Janus Henderson Group Fourth Quarter and Full Year 2023 Results Briefing. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer period. In the interest of time, questions will be limited to one initial and one follow-up question.
In today's conference call, certain matters discussed may constitute forward-looking statements. Actual results could differ materially from those projected in the forward-looking statements due to a number of factors, including but not limited to those described in the forward-looking statements and risks factors' sections of the company's most recent Form 10-K and other more recent filings made with the SEC. Janus Henderson assumes no obligation to update any forward-looking statements made during the call. Thank you.
Now it's my pleasure to introduce Ali Dibadj, Chief Executive Officer of Janus Henderson. Mr. Dibadj, you may begin your conference.
Ali Dibadj
Welcome everyone and thank you for joining us today on Janus Henderson's fourth quarter and full year 2023 earnings call. I'm Ali Dibadj and I'm joined by our CFO, Roger Thompson. In today's call, I'll start with some comments on the year. Roger will then go through the results and after that I'll provide an update on the strategic progress we made in 2023. After those prepared remarks, we'll take your questions.
Turn to Slide 2. After one of the most challenging market backdrops in 2022, most global markets rebounded and experienced growth in 2023 as concerns about inflation, progressive monetary policy, recession fears, and shocks to the banking system in early 2023 were overshadowed by inflation coming off peak levels, resilient economies, particularly in the U.S., the expectation of the end of rate hikes. Even with positive market returns for the year, headwinds remain as global markets look set to remain conflicted with the consequences of historic rate hikes finally manifesting themselves. Amidst this volatility, we ended the year strongly with fourth quarter results that delivered underlying net flows, revenue, operating expenses, margin and EPS that were all ahead of or in line with external expectations. And on top of that, our teams delivered better than anticipated performance fees and tax rate.
As I reflect upon the year, there were several signs of clear progress at Janus Henderson. This progress was the result of the collaboration, hard work, and perseverance of colleagues across the firm and as a squarely on the path to achieving our ambitions of organic growth and delivering superior outcomes for our clients, their clients, colleagues, shareholders and other stakeholders. We're executing our strategic vision, which consists of three pillars: protect and grow our core businesses, amplify our strengths not fully leveraged, and diversify where clients give us the right to win. Later on in the presentation, I'll provide detail on the progress made for some of our strategic initiatives.
2023 net outflows of $700 million improved markedly from 2022 net outflows of $31 billion. The improvement was driven by lower redemptions and large wins in global institutional and a turnaround in the North American intermediary business, both of which are strategic initiatives that we've emphasized at Janus Henderson and previously discussed here. In early 2023, we re-energized our culture by introducing our mission, values, and purpose company-wide, and we continue to embed this critical mindset across the firm. Cost efficiencies or fuel for growth, which allow for reinvestment in Janus Henderson's strategic initiatives on behalf of our clients were realized at a faster pace than expected and at a higher dollar amount. We achieved run rate cost efficiencies of more than $50 million by the end of 2023 compared to the original $40 million to $45 million by the end of 2024. All of these cost savings have been or will be reinvested in the business....
Janus Henderson Group plc (JHG) Q4 2023 Earnings Call Transcript