- Solid long-term investment performance, with 50%, 64%, 67%, and
75% of assets under management (‘AUM’) outperforming relevant
benchmarks on a one-, three-, five-, and 10-year basis,
respectively, as at 30 September 2022
- AUM decreased 8% to US$274.6 billion compared to the prior
quarter, due to market declines, US dollar appreciation, and net
outflows
- Net outflows of US$(5.8) billion primarily reflect market
uncertainty and investment underperformance in key strategies
- Third quarter 2022 diluted EPS of US$0.65, or US$0.61 on an
adjusted basis
- Board declared a quarterly dividend of US$0.39 per share
- Strong balance sheet and cash generation, with over US$1.0
billion in cash and cash equivalents and US$221.9 million of cash
provided from operating activities in the third quarter 2022
- Actioning US$40 million to US$45 million in gross run-rate cost
efficiencies expected to be realised by the end of 2023, which will
be offset by investments in the business to drive growth
Janus Henderson Group plc (NYSE/ASX: JHG; ‘Janus Henderson’,
‘JHG’, ‘the Group’, ‘the Company’) published its third quarter 2022
results for the period ended 30 September 2022.
Third quarter 2022 operating income was US$120.7 million
compared to US$143.9 million in the second quarter 2022 and
US$248.3 million in the third quarter 2021. Adjusted operating
income, adjusted for one-time, acquisition and transaction related
costs, was US$125.4 million in the third quarter 2022 compared to
US$149.3 million in the second quarter 2022 and US$253.0 million in
the third quarter 2021.
Third quarter 2022 diluted earnings per share of US$0.65
compared to US$0.571 in the second quarter 2022 and US$1.14 in the
third quarter 2021. Adjusted diluted earnings per share of US$0.61
in the third quarter 2022 compared to US$0.63 in the second quarter
2022 and compared to US$1.16 in the third quarter 2021.
Ali Dibadj, Chief Executive Officer of Janus Henderson Group
plc, stated:
“The world continues to be volatile, and this is when our
clients, and their clients, need us. Janus Henderson’s investment
insights, client-service, strong balance sheet, and stable
foundation are keys to delivering superior financial outcomes for
our clients. In this environment, we continue to control what we
can control, looking keenly at expenses, increasing client
outreach, and more broadly sharing our market perspectives.
“The work being done to reenergise the Company’s future strategy
is well underway, and we believe the cost efficiencies announced
today will provide the ‘Fuel for Growth’ to allow investment in the
business, which we believe will improve our growth trajectory over
time.”
SUMMARY OF FINANCIAL RESULTS (unaudited) (in US$ millions,
except per share data or as noted)
The Group presents its financial results in US$ and in
accordance with accounting principles generally accepted in the
United States of America (‘US GAAP’ or ‘GAAP’). However, JHG
management evaluates the profitability of the Group and its ongoing
operations using additional non-GAAP financial measures. Management
uses these performance measures to evaluate the business, and
adjusted values are consistent with internal management reporting.
See ‘Reconciliation of non-GAAP financial information’ below for
additional information.
Three months ended
30 Sep
30 Jun
30 Sep
2022
2022
2021
GAAP
basis:1
Revenue
512.9
555.5
687.4
Operating expenses
392.2
411.6
439.1
Operating income
120.7
143.9
248.3
Operating margin
23.5
%
25.9
%
36.1
%
Net income attributable to JHG
107.6
96.2
196.8
Diluted earnings per share
0.65
0.57
1.14
Adjusted
basis:
Revenue
394.2
427.7
545.3
Operating expenses
268.8
278.4
292.3
Operating income
125.4
149.3
253.0
Operating margin
31.8
%
34.9
%
46.4
%
Net income attributable to JHG
101.1
104.9
199.5
Diluted earnings per share
0.61
0.63
1.16
____________________
1
Please see footnote to ‘Condensed
consolidated statements of comprehensive income (unaudited)’ below
for detail on the revision to ‘Net income attributable to JHG’ and
‘Diluted earnings per share’ on a GAAP basis for the three months
ended 30 June 2022.
DIVIDEND AND SHARE BUYBACK
On 26 October 2022, the Board declared a third quarter dividend
in respect of the three months ended 30 September 2022 of US$0.39
per share. Shareholders on the register on the record date of 7
November 2022 will be paid the dividend on 23 November 2022.
The Group did not purchase any of its ordinary shares on the New
York Stock Exchange (‘NYSE’) or its CHESS Depositary Interests
(‘CDIs’) on the Australian Securities Exchange (‘ASX’) in the third
quarter as part of the US$200 million on-market buyback programme
approved by the Board in May 2022.
AUM AND FLOWS (in US$ billions)
FX reflects movement in AUM resulting from changes in foreign
currency rates as non-US$ denominated AUM is translated into US$.
Redemptions include impact of client switches.
Total Group comparative AUM and
flows
Three months ended
30 Sep
30 Jun
30 Sep
2022
2022
2021
Opening AUM
299.7
361.0
427.6
Sales
11.4
16.4
16.0
Redemptions
(17.2
)
(24.2
)
(21.2
)
Net sales / (redemptions)
(5.8
)
(7.8
)
(5.2
)
Market / FX
(19.3
)
(53.5
)
(3.1
)
Closing AUM
274.6
299.7
419.3
Quarterly AUM and flows by
capability
Total excl
Fixed
Quantitative
Quantitative
Equities
Income
Multi-Asset
Alternatives
Equities
Equities
Total
AUM 30 Sep 2021
236.2
79.5
53.9
10.6
380.2
39.1
419.3
Sales
8.1
5.6
4.3
1.2
19.2
0.1
19.3
Redemptions
(11.3
)
(5.5
)
(2.2
)
(1.2
)
(20.2
)
(4.3
)
(24.5
)
Net sales / (redemptions)
(3.2
)
0.1
2.1
—
(1.0
)
(4.2
)
(5.2
)
Market / FX
11.3
—
3.7
0.1
15.1
3.1
18.2
AUM 31 Dec 2021
244.3
79.6
59.7
10.7
394.3
38.0
432.3
Sales
8.5
6.0
2.3
0.9
17.7
0.2
17.9
Redemptions
(12.3
)
(6.0
)
(4.5
)
(1.1
)
(23.9
)
(5.9
)
(29.8
)
Net sales / (redemptions)
(3.8
)
—
(2.2
)
(0.2
)
(6.2
)
(5.7
)
(11.9
)
Market / FX
(20.5
)
(4.1
)
(3.6
)
(0.2
)
(28.4
)
(2.7
)
(31.1
)
Reclassifications and disposals1
1.3
—
—
—
1.3
(29.6
)
(28.3
)
AUM 31 Mar 2022
221.3
75.5
53.9
10.3
361.0
—
361.0
Sales
5.5
4.9
1.6
4.4
16.4
—
16.4
Redemptions
(11.3
)
(8.2
)
(2.5
)
(2.2
)
(24.2
)
—
(24.2
)
Net sales / (redemptions)
(5.8
)
(3.3
)
(0.9
)
2.2
(7.8
)
—
(7.8
)
Market / FX
(38.5
)
(7.7
)
(6.5
)
(0.8
)
(53.5
)
—
(53.5
)
AUM 30 Jun 2022
177.0
64.5
46.5
11.7
299.7
—
299.7
Sales
4.8
4.4
1.5
0.7
11.4
—
11.4
Redemptions
(8.9
)
(5.6
)
(1.7
)
(1.0
)
(17.2
)
—
(17.2
)
Net sales / (redemptions)
(4.1
)
(1.2
)
(0.2
)
(0.3
)
(5.8
)
—
(5.8
)
Market / FX
(11.1
)
(4.8
)
(2.5
)
(0.9
)
(19.3
)
—
(19.3
)
AUM 30 Sep 2022
161.8
58.5
43.8
10.5
274.6
—
274.6
____________________
1
Disposals relate to the sale of
Intech, and reclassifications relate to a reclassification of
existing funds from Quantitative Equities to Equities.
Average AUM by capability
Three months ended
30 Sep
30 Jun
30 Sep
2022
2022
2021
Equities
182.4
197.0
243.5
Fixed Income
63.7
68.8
80.9
Multi-Asset
47.5
49.5
54.9
Quantitative Equities
—
—
41.9
Alternatives
11.4
13.2
10.7
Total
305.0
328.5
431.9
INVESTMENT PERFORMANCE
% of AUM outperforming benchmark (at 30
September 2022)
Capability
1-year
3-year
5-year
10-year
Equities
42
%
50
%
51
%
64
%
Fixed Income
43
%
76
%
89
%
90
%
Multi-Asset
94
%
96
%
96
%
99
%
Alternatives
29
%
100
%
100
%
100
%
Total
50
%
64
%
67
%
75
%
Outperformance is measured based on composite performance gross
of fees vs primary benchmark, except where a strategy has no
benchmark index or corresponding composite in which case the most
relevant metric is used: (1) composite gross of fees vs zero for
absolute return strategies, (2) fund net of fees vs primary index,
or (3) fund net of fees vs Morningstar peer group average or
median. Non-discretionary and separately managed account assets are
included with a corresponding composite where applicable.
Cash management vehicles, ETF-enhanced beta strategies, Managed
CDOs, Private Equity funds, and custom non-discretionary accounts
with no corresponding composite are excluded from the analysis.
Performance across all time periods excludes Intech, the sale of
which was completed 31 March 2022. Excluded assets represent 5% of
AUM as at 30 September 2022. Capabilities defined by Janus
Henderson.
% of mutual fund AUM in top 2
Morningstar quartiles (at 30 September 2022)
Capability
1-year
3-year
5-year
10-year
Equities
61
%
38
%
71
%
90
%
Fixed Income
36
%
61
%
76
%
85
%
Multi-Asset
96
%
92
%
92
%
96
%
Alternatives
89
%
95
%
67
%
100
%
Total
66
%
53
%
76
%
91
%
Includes Janus Investment Fund, Janus Aspen Series and Clayton
Street Trust (US Trusts), Janus Henderson Capital Funds (Dublin
based), Dublin and UK OEIC and Investment Trusts, Luxembourg
SICAVs, and Australian Managed Investment Schemes. Performance
across all time periods excludes Intech, the sale of which was
completed 31 March 2022. The top two Morningstar quartiles
represent funds in the top half of their category based on total
return. For the 1-, 3-, 5-, and 10-year periods ending 30 September
2022, 54%, 53%, 60%, and 68% of the 189, 179, 174, and 152 total
mutual funds, respectively, were in the top 2 Morningstar
quartiles.
Analysis based on ‘primary’ share class (Class I Shares,
Institutional Shares or share class with longest history for US
Trusts; Class A Shares or share class with longest history for
Dublin based; primary share class as defined by Morningstar for
other funds). Performance may vary by share class. Rankings may be
based, in part, on the performance of a predecessor fund or share
class and are calculated by Morningstar using a methodology that
differs from that used by Janus Henderson. Methodology differences
may have a material effect on the return and therefore the ranking.
When an expense waiver is in effect, it may have a material effect
on the total return, and therefore the ranking for the period.
ETFs and funds not ranked by Morningstar are excluded from the
analysis. Capabilities defined by Janus Henderson. © 2022
Morningstar, Inc. All Rights Reserved.
FOURTH QUARTER AND FULL-YEAR 2022 RESULTS
Janus Henderson intends to publish its fourth quarter and
full-year 2022 results on 2 February 2023.
THIRD QUARTER 2022 RESULTS BRIEFING INFORMATION
Chief Executive Officer Ali Dibadj and Chief Financial Officer
Roger Thompson will present these results on 27 October 2022 on a
conference call and webcast to be held at 8am EDT, 1pm BST, 11pm
AEDT.
Those wishing to participate should call:
United Kingdom
0808 189 6484 (toll free)
United States
844 200 6205 (toll free)
Australia
02 7908 3093 (this is not toll
free)
All other countries
+1 929 526 1599 (this is not toll
free)
Conference ID
416605
Access to the webcast and accompanying slides will be available
via the investor relations section of Janus Henderson’s website
(ir.janushenderson.com).
About Janus Henderson
Janus Henderson Group is a leading global active asset manager
dedicated to helping investors achieve long-term financial goals
through a broad range of investment solutions, including equities,
fixed income, multi-asset, and alternative asset class
strategies.
At 30 September 2022, Janus Henderson had approximately US$275
billion in assets under management, more than 2,000 employees, and
offices in 23 cities worldwide. Headquartered in London, the
company is listed on the NYSE and the ASX.
FINANCIAL DISCLOSURES
Condensed consolidated statements of
comprehensive income (unaudited)
Three months ended
30 Sep
30 Jun
30 Sep
(in US$ millions, except per share data
or as noted)
2022
2022
2021
Revenue:
Management fees
426.2
453.6
564.5
Performance fees
(13.2
)
(3.4
)
0.6
Shareowner servicing fees
54.0
56.3
67.6
Other revenue
45.9
49.0
54.7
Total revenue
512.9
555.5
687.4
Operating expenses:
Employee compensation and benefits
142.5
145.0
166.2
Long-term incentive plans
41.1
40.7
35.0
Distribution expenses
118.7
127.8
142.1
Investment administration
12.5
10.3
13.0
Marketing
5.6
7.8
7.5
General, administrative and occupancy
64.7
72.3
65.5
Depreciation and amortisation
7.1
7.7
9.8
Total operating expenses
392.2
411.6
439.1
Operating income
120.7
143.9
248.3
Interest expense
(3.1
)
(3.2
)
(3.2
)
Investment gains (losses), net
11.0
(109.4
)
4.7
Other non-operating income, net1
13.9
0.6
3.6
Income before taxes
142.5
31.9
253.4
Income tax provision
(27.9
)
(36.7
)
(53.3
)
Net income (loss)
114.6
(4.8
)
200.1
Net loss (income) attributable to
noncontrolling interests
(7.0
)
101.0
(3.3
)
Net income attributable to JHG
107.6
96.2
196.8
Less: allocation of earnings to
participating stock-based awards
(3.3
)
(3.0
)
(5.4
)
Net income attributable to JHG common
shareholders
104.3
93.2
191.4
Basic weighted-average shares outstanding
(in millions)
160.5
161.9
167.1
Diluted weighted-average shares
outstanding (in millions)
160.9
162.2
167.8
Diluted earnings per share (in
US$)
0.65
0.57
1.14
____________________
1
In the second quarter of 2022, we
identified a US$2.3 million error related to the accounting of
accumulated other comprehensive income associated with the
liquidation of certain entities. Foreign currency translation in
accumulated other comprehensive income related to liquidated
entities should have been reclassified to other non-operating
income (expense), net, on our consolidated statement of
comprehensive income in 2020.
Reconciliation of non-GAAP financial information
In addition to financial results reported in accordance with
GAAP, we compute certain financial measures using non-GAAP
components, as defined by the SEC. These measures are not in
accordance with, or a substitute for, GAAP, and our financial
measures may be different from non-GAAP financial measures used by
other companies. We have provided a reconciliation of our non-GAAP
components to the most directly comparable GAAP components. The
following are reconciliations of US GAAP revenue, operating
expenses, operating income, net income attributable to JHG, and
diluted earnings per share to adjusted revenue, adjusted operating
expenses, adjusted operating income, adjusted net income
attributable to JHG, and adjusted diluted earnings per share.
Three months ended
30 Sep
30 Jun
30 Sep
(in US$ millions, except per share data
or as noted)
2022
2022
2021
Reconciliation of revenue to adjusted
revenue
Revenue
512.9
555.5
687.4
Management fees1
(46.0
)
(50.9
)
(53.0
)
Shareowner servicing fees1
(43.7
)
(46.9
)
(55.4
)
Other revenue1
(29.0
)
(30.0
)
(33.7
)
Adjusted revenue
394.2
427.7
545.3
Reconciliation of operating expenses to
adjusted operating expenses
Operating expenses
392.2
411.6
439.1
Long-term incentive plans2
(2.4
)
(3.6
)
0.1
Distribution expenses1
(118.7
)
(127.8
)
(142.1
)
General, administration and occupancy2
(1.7
)
(1.1
)
(2.9
)
Depreciation and amortisation3
(0.6
)
(0.7
)
(1.9
)
Adjusted operating expenses
268.8
278.4
292.3
Adjusted operating income
125.4
149.3
253.0
Operating margin
23.5
%
25.9
%
36.1
%
Adjusted operating margin
31.8
%
34.9
%
46.4
%
Reconciliation of net income
attributable to JHG to adjusted net income attributable to
JHG
Net income attributable to JHG
107.6
96.2
196.8
Long-term incentive plans2
2.4
3.6
(0.1
)
General, administration and occupancy2
1.7
1.1
2.9
Depreciation and amortisation3
0.6
0.7
1.9
Other non-operating income (expense),
net4
(10.3
)
3.0
(1.6
)
Income tax benefit (provision)5
(0.9
)
0.3
(0.4
)
Adjusted net income attributable to
JHG
101.1
104.9
199.5
Less: allocation of earnings to
participating stock-based awards
(3.3
)
(3.3
)
(5.5
)
Adjusted net income attributable to JHG
common shareholders
97.8
101.6
194.0
Weighted-average diluted common shares
outstanding – diluted (two class) (in millions)
160.9
162.2
167.8
Diluted earnings per share (two class)
(in US$)
0.65
0.57
1.14
Adjusted diluted earnings per share
(two class) (in US$)
0.61
0.63
1.16
____________________
1
JHG contracts with third-party
intermediaries to distribute and service certain of its investment
products. Fees for distribution and servicing related activities
are either provided for separately in an investment product’s
prospectus or are part of the management fee. Under both
arrangements, the fees are collected by JHG and passed through to
third-party intermediaries who are responsible for performing the
applicable services. The majority of distribution and servicing
fees collected by JHG are passed through to third-party
intermediaries. JHG management believes that the deduction of
distribution and service fees from revenue in the computation of
adjusted revenue reflects the pass-through nature of these
revenues. In certain arrangements, JHG performs the distribution
and servicing activities and retains the applicable fees. Revenues
for distribution and servicing activities performed by JHG are not
deducted from GAAP revenue.
2
Adjustments for the three months
ended 30 September 2022 and 30 June 2022 consist primarily of
long-term incentive plan expense acceleration related to the
departure of certain employees and rent expense for subleased
office space. Adjustments for the three months ended 30 September
2021 consist primarily of rent expense for subleased office space.
JHG management believes these costs do not represent our ongoing
operations.
3
Investment management contracts
have been identified as a separately identifiable intangible asset
arising on the acquisition of subsidiaries and businesses. Such
contracts are recognised at the net present value of the expected
future cash flows arising from the contracts at the date of
acquisition. For segregated mandate contracts, the intangible asset
is amortised on a straight-line basis over the expected life of the
contracts. JHG management believes these non-cash and
acquisition-related costs are not representative of the ongoing
operations of the Group.
4
Adjustments for the three months
ended 30 September 2022 and 30 June 2022 primarily relate to
accumulated foreign currency translation expense related to
liquidated JHG entities and rental income from subleased office
space. Adjustments for the three months ended 30 September 2021
consist primarily of rental income from subleased office space. JHG
management believes these costs are not representative of our
ongoing operations.
5
The tax impact of the adjustments
is calculated based on the applicable US or foreign statutory tax
rate as it relates to each adjustment. Certain adjustments are
either not taxable or not tax-deductible.
Condensed consolidated balance sheets
(unaudited)
30 Sep
31 Dec
(in US$ millions)
2022
2021
Assets:
Cash and cash equivalents
1,022.9
1,107.3
Investment securities
284.1
451.4
Property, equipment and software, net
49.0
63.3
Intangible assets and goodwill, net
3,631.5
3,917.0
Assets of consolidated variable interest
entities
239.7
264.3
Other assets
896.9
924.2
Total assets
6,124.1
6,727.5
Liabilities, redeemable noncontrolling
interests and equity:
Long-term debt
308.2
310.4
Deferred tax liabilities, net
597.5
619.2
Liabilities of consolidated variable
interest entities
5.1
2.6
Other liabilities
814.4
968.7
Redeemable noncontrolling interests
153.1
163.4
Total equity
4,245.8
4,663.2
Total liabilities, redeemable
noncontrolling interests and equity
6,124.1
6,727.5
Condensed consolidated statements of
cash flows (unaudited)
Three months ended
30 Sep
30 Jun
30 Sep
(in US$ millions)
2022
2022
2021
Cash provided by (used for):
Operating activities
221.9
162.9
319.4
Investing activities
51.8
76.1
(222.9
)
Financing activities
(64.5
)
(135.9
)
(112.9
)
Effect of exchange rate changes
(47.2
)
(42.8
)
(16.3
)
Net change during period
162.0
60.3
(32.7
)
STATUTORY DISCLOSURES
Associates and joint ventures
At 30 September 2022, the Group holds interests in the following
associates and joint ventures managed through shareholder
agreements with third party investors, accounted for under the
equity method:
- LongTail Alpha LLC ownership 20%
Basis of preparation
In the opinion of management of Janus Henderson Group plc, the
condensed consolidated financial statements contain all normal
recurring adjustments necessary to fairly present the financial
position, results of operations, and cash flows of JHG in
accordance with US GAAP. Such financial statements have been
prepared in accordance with the instructions to Form 10‑Q pursuant
to the rules and regulations of the SEC. Certain information and
footnote disclosures normally included in financial statements
prepared in accordance with GAAP have been condensed or omitted
pursuant to such rules and regulations. The financial statements
should be read in conjunction with the annual consolidated
financial statements and notes presented in Janus Henderson Group’s
Annual Report on Form 10‑K for the year ended 31 December 2021, on
file with the SEC (Commission File No. 001‑38103). Events
subsequent to the balance sheet date have been evaluated for
inclusion in the financial statements through the issuance date and
are included in the notes to the condensed consolidated financial
statements.
Corporate governance principles and recommendations
In the opinion of the Directors, the financial records of the
Group have been properly maintained, and the Condensed Consolidated
Financial Statements comply with the appropriate accounting
standards and give a true and fair view of the financial position
and performance of the Group. This opinion has been formed on the
basis of a sound system of risk management and internal control
which is operating effectively.
FORWARD-LOOKING STATEMENTS DISCLAIMER
Past performance is no guarantee of future results. Investing
involves risk, including the possible loss of principal and
fluctuation of value.
This document includes statements concerning potential future
events involving Janus Henderson Group plc that could differ
materially from the events that actually occur. The differences
could be caused by a number of factors, including, but not limited
to, recent changes in interest rates and inflation, volatility, or
disruption in financial markets, our investment performance as
compared to third-party benchmarks or competitive products,
redemptions and other withdrawals from the funds and accounts we
manage, and other factors identified in Janus Henderson Group’s
Annual Report on Form 10‑K for the fiscal year ended 31 December
2021 and in other filings or furnishings made by the Company with
the Securities and Exchange Commission from time to time
(Commission File No. 001‑38103), including those that appear under
headings such as ‘Risk Factors’ and ‘Management’s Discussion and
Analysis of Financial Condition and Results of Operations’. Many of
these factors are beyond the control of JHG and its management. Any
forward-looking statements contained in this document are as at the
date on which such statements were made. Janus Henderson Group
undertakes no obligation to publicly update or revise any
forward-looking statements after the date they are made, whether as
a result of new information, future events or otherwise, except as
required by law.
Annualised, pro forma, projected, and estimated numbers are used
for illustrative purposes only, are not forecasts, and may not
reflect actual results.
The information, statements, and opinions contained in this
document do not constitute a public offer under any applicable
legislation or an offer to sell or solicitation of any offer to buy
any securities or financial instruments or any advice or
recommendation with respect to such securities or other financial
instruments.
Not all products or services are available in all
jurisdictions.
Mutual funds in the US are distributed by Janus Henderson
Distributors US LLC.
Please consider the charges, risks, expenses, and investment
objectives carefully before investing. For a US fund prospectus or,
if available, a summary prospectus containing this and other
information, please contact your investment professional or call
800.668.0434. Read it carefully before you invest or send
money.
Janus Henderson is a trademark of Janus Henderson Group plc or
one of its subsidiaries. © Janus Henderson Group plc.
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Investor enquiries: Jim Kurtz Head of Investor Relations
+1 303 336 4529 jim.kurtz@janushenderson.com Or Investor Relations
investor.relations@janushenderson.com Media enquiries:
Stephen Sobey Head of Media Relations +44 (0)20 7818 2523
stephen.sobey@janushenderson.com
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