Cover Page
Cover Page - shares | 9 Months Ended | |
Sep. 30, 2020 | Oct. 20, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2020 | |
Document Transition Report | false | |
Entity File Number | 001-10994 | |
Entity Registrant Name | VIRTUS INVESTMENT PARTNERS, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 26-3962811 | |
Entity Address, Address Line One | One Financial Plaza | |
Entity Address, City or Town | Hartford | |
Entity Address, State or Province | CT | |
Entity Address, Postal Zip Code | 06103 | |
City Area Code | 800 | |
Local Phone Number | 248-7971 | |
Title of 12(b) Security | Common Stock, $0.01 par value | |
Trading Symbol | VRTS | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding (in shares) | 7,613,154 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q3 | |
Entity Central Index Key | 0000883237 | |
Current Fiscal Year End Date | --12-31 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Assets: | ||
Accounts receivable, net | $ 76,616 | $ 74,132 |
Furniture, equipment and leasehold improvements, net | 15,287 | 18,150 |
Intangible assets, net | 287,793 | 310,391 |
Goodwill | 290,366 | 290,366 |
Deferred taxes, net | 8,862 | 15,879 |
Total assets | 3,390,724 | 3,204,634 |
Liabilities: | ||
Accrued compensation and benefits | 87,256 | 101,377 |
Accounts payable and accrued liabilities | 21,633 | 23,308 |
Dividends payable | 8,742 | 8,915 |
Debt | 218,014 | 277,839 |
Other liabilities | 35,833 | 40,507 |
Total liabilities | 2,603,435 | 2,454,532 |
Commitments and Contingencies (Note 13) | ||
Temporary Equity: | ||
Redeemable noncontrolling interests | 99,277 | 63,845 |
Equity attributable to stockholders: | ||
Series D mandatory convertible preferred stock, $0.01 par value, 0 and 1,150,000 shares authorized, issued and outstanding at September 30, 2020 and December 31, 2019, respectively | 0 | 110,843 |
Common stock, $0.01 par value, 1,000,000,000 shares authorized; 11,780,481 shares issued and 7,613,154 shares outstanding at September 30, 2020, respectively, and 10,736,887 shares issued and 6,809,280 shares outstanding at December 31, 2019, respectively | 118 | 107 |
Additional paid-in capital | 1,301,735 | 1,199,205 |
Retained earnings (accumulated deficit) | (178,574) | (215,216) |
Accumulated other comprehensive income (loss) | 0 | 9 |
Treasury stock, at cost, 4,167,327 and 3,927,607 shares at September 30, 2020 and December 31, 2019, respectively | (444,249) | (419,249) |
Total equity attributable to stockholders | 679,030 | 675,699 |
Total equity | 688,012 | 686,257 |
Total liabilities and equity | 3,390,724 | 3,204,634 |
Consolidated entity excluding consolidated investment products | ||
Assets: | ||
Cash and cash equivalents | 202,212 | 221,781 |
Investments | 54,446 | 83,206 |
Other assets | 39,807 | 36,849 |
Consolidated Investment Products | ||
Assets: | ||
Cash and cash equivalents | 48,228 | 99,691 |
Investments | 2,333,685 | 2,030,110 |
Cash pledged or on deposit of CIP | 6,007 | 467 |
Other assets | 27,415 | 23,612 |
Liabilities: | ||
Notes payable of CIP | 2,190,937 | 1,834,535 |
Securities purchased payable and other liabilities of CIP | 41,020 | 168,051 |
Equity attributable to stockholders: | ||
Noncontrolling interests | $ 8,982 | $ 10,558 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2020 | Dec. 31, 2019 |
Common stock, par value (in $ per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued (in shares) | 11,780,481 | 10,736,887 |
Common stock, shares outstanding (in shares) | 7,613,154 | 6,809,280 |
Treasury stock, shares (in shares) | 4,167,327 | 3,927,607 |
Series D convertible preferred stock | ||
Preferred stock, par value (in $ per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 0 | 1,150,000 |
Preferred stock, shares issued (in shares) | 0 | 1,150,000 |
Preferred stock, shares outstanding (in shares) | 0 | 1,150,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Revenues | ||||
Revenues | $ 154,790 | $ 145,955 | $ 432,250 | $ 417,162 |
Operating Expenses | ||||
Employment expenses | 67,479 | 61,282 | 193,772 | 180,256 |
Distribution and other asset-based expenses | 19,570 | 20,927 | 56,324 | 62,013 |
Other operating expenses | 16,343 | 18,228 | 52,664 | 56,125 |
Restructuring and severance | 735 | 523 | 1,155 | 2,019 |
Depreciation expense | 1,106 | 1,245 | 3,560 | 3,729 |
Amortization expense | 7,532 | 7,587 | 22,598 | 22,711 |
Total operating expenses | 113,781 | 110,168 | 340,017 | 330,248 |
Operating Income (Loss) | 41,009 | 35,787 | 92,233 | 86,914 |
Other Income (Expense) | ||||
Other income (expense), net | 999 | 746 | 806 | 1,892 |
Total other income (expense), net | 6,177 | (4,596) | (9,859) | 9,821 |
Interest Income (Expense) | ||||
Total interest income (expense), net | 5,726 | 5,012 | 5,622 | 2,842 |
Income (Loss) Before Income Taxes | 52,912 | 36,203 | 87,996 | 99,577 |
Income tax expense (benefit) | 11,978 | 10,844 | 29,847 | 23,851 |
Net Income (Loss) | 40,934 | 25,359 | 58,149 | 75,726 |
Noncontrolling interests | (11,286) | (1,274) | (21,507) | (2,969) |
Net Income (Loss) Attributable to Stockholders | 29,648 | 24,085 | 36,642 | 72,757 |
Preferred stockholder dividends | 0 | (2,085) | 0 | (6,253) |
Net Income (Loss) Attributable to Common Stockholders | $ 29,648 | $ 22,000 | $ 36,642 | $ 66,504 |
Earnings (Loss) per share—Basic (in $ per share) | $ 3.86 | $ 3.17 | $ 4.81 | $ 9.51 |
Earnings (Loss) per Share—Diluted (in $ per share) | $ 3.71 | $ 2.95 | $ 4.60 | $ 8.86 |
Weighted Average Shares Outstanding—Basic (in shares) | 7,684 | 6,947 | 7,611 | 6,990 |
Weighted Average Shares Outstanding—Diluted (in shares) | 7,997 | 8,157 | 7,958 | 8,215 |
Consolidated Investment Products | ||||
Operating Expenses | ||||
Total operating expenses | $ 1,016 | $ 376 | $ 9,944 | $ 3,395 |
Other Income (Expense) | ||||
Realized and unrealized gain (loss) on investments, net | 2,680 | (5,344) | (12,733) | 2,455 |
Interest Income (Expense) | ||||
Interest expense | (17,622) | (21,252) | (70,258) | (72,030) |
Interest and dividend income | 26,088 | 30,290 | 83,951 | 87,060 |
Consolidated entity excluding consolidated investment products | ||||
Other Income (Expense) | ||||
Realized and unrealized gain (loss) on investments, net | 2,498 | 2 | 2,068 | 5,474 |
Interest Income (Expense) | ||||
Interest expense | (2,877) | (4,889) | (9,202) | (15,205) |
Interest and dividend income | 137 | 863 | 1,131 | 3,017 |
Investment management fees | ||||
Revenues | ||||
Revenues | 129,785 | 120,023 | 360,623 | 340,532 |
Distribution and service fees | ||||
Revenues | ||||
Revenues | 9,797 | 10,442 | 28,146 | 31,122 |
Administration and shareholder service fees | ||||
Revenues | ||||
Revenues | 15,114 | 15,280 | 43,056 | 44,747 |
Other income and fees | ||||
Revenues | ||||
Revenues | $ 94 | $ 210 | $ 425 | $ 761 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
Net Income (Loss) | $ 40,934 | $ 25,359 | $ 58,149 | $ 75,726 |
Other comprehensive income (loss), net of tax: | ||||
Foreign currency translation adjustment, net of tax of $(6) and $4 for the three months ended September 30, 2020 and 2019, respectively, and $3 and $5 for the nine months ended September 30, 2020 and 2019, respectively | 17 | (12) | (9) | (14) |
Other comprehensive income (loss) | 17 | (12) | (9) | (14) |
Comprehensive income (loss) | 40,951 | 25,347 | 58,140 | 75,712 |
Comprehensive (income) loss attributable to noncontrolling interests | (11,286) | (1,274) | (21,507) | (2,969) |
Comprehensive Income (Loss) Attributable to Stockholders | $ 29,665 | $ 24,073 | $ 36,633 | $ 72,743 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
Foreign currency translation adjustment, tax | $ (6) | $ 4 | $ 3 | $ 5 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Cash Flows from Operating Activities: | ||
Net income (loss) | $ 58,149 | $ 75,726 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Depreciation expense, intangible asset and other amortization | 32,153 | 29,766 |
Stock-based compensation | 16,412 | 16,384 |
Amortization of deferred commissions | 1,544 | 2,413 |
Payments of deferred commissions | (1,475) | (1,522) |
Equity in earnings of equity method investments | (855) | (2,001) |
(Gain) loss on extinguishment of debt | (705) | 0 |
Distributions from equity method investments | 921 | 828 |
Sales (purchases) of investments, net | 15,586 | 8,784 |
Deferred taxes, net | 7,020 | 3,392 |
Changes in operating assets and liabilities: | ||
Accounts receivable, net and other assets | (7,989) | (3,057) |
Accrued compensation and benefits, accounts payable, accrued liabilities and other liabilities | (22,931) | (24,211) |
Operating activities of consolidated investment products ("CIP"): | ||
Net cash provided by (used in) operating activities | (380,267) | (103,015) |
Cash Flows from Investing Activities: | ||
Capital expenditures and other asset purchases | (789) | (6,961) |
Sale of available-for-sale securities | 0 | 2,023 |
Net cash provided by (used in) investing activities | 8,935 | 13,470 |
Cash Flows from Financing Activities: | ||
Payment of long term debt | (61,573) | (39,839) |
Common stock dividends paid | (16,460) | (12,244) |
Preferred stock dividends paid | (2,084) | (6,253) |
Repurchases of common shares | (25,000) | (30,000) |
Taxes paid related to net share settlement of restricted stock units | (5,530) | (5,953) |
Net subscriptions received from (redemptions/distributions paid to) noncontrolling interests | (5,935) | 7,630 |
Net cash provided by (used in) financing activities | 305,840 | 113,921 |
Net increase (decrease) in cash, cash equivalents and restricted cash | (65,492) | 24,376 |
Cash, cash equivalents and restricted cash, beginning of period | 321,939 | 254,656 |
Cash, cash equivalents and restricted cash, end of period | 256,447 | 279,032 |
Non-Cash Investing Activities: | ||
Change in accrual for capital expenditures | 8 | (1,784) |
Non-Cash Financing Activities: | ||
Increase (decrease) to noncontrolling interests due to consolidation (deconsolidation) of CIP, net | 17,137 | 22,046 |
Common stock dividends payable | 6,288 | 4,608 |
Preferred stock dividends payable | 0 | 2,085 |
Conversion of preferred stock to common stock | 115,000 | 0 |
Reconciliation of cash, cash equivalents and restricted cash | ||
Cash, cash equivalents and restricted cash at end of period | 321,939 | 279,032 |
Consolidated entity excluding consolidated investment products | ||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Realized and unrealized (gains) losses on investments, net | (2,069) | (4,636) |
Consolidated Investment Products | ||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Realized and unrealized (gains) losses on investments, net | 6,739 | (3,063) |
Operating activities of consolidated investment products ("CIP"): | ||
Purchases of investments by CIP | (1,114,801) | (805,599) |
Sales of investments by CIP | 624,675 | 588,678 |
Net proceeds (purchases) of short term investments by CIP | 1,434 | 2,294 |
(Purchases) sales of securities sold short by CIP, net | 267 | 1,241 |
Change in other assets of CIP | (2,039) | (184) |
Change in liabilities of CIP | (3,472) | 7,247 |
Amortization of discount on notes payable of CIP | 11,169 | 4,505 |
Cash Flows from Investing Activities: | ||
Change in cash and cash equivalents of CIP due to consolidation (deconsolidation), net | 9,724 | 18,408 |
Cash Flows from Financing Activities: | ||
Payments on borrowings by CIP | (358,725) | (195,697) |
Borrowings by CIP | $ 781,147 | $ 396,277 |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Changes in Equity - USD ($) $ in Thousands | Total | Common Stock | Preferred StockSeries D convertible preferred stock | Additional Paid-in Capital | Retained Earnings (Accumulated Deficit) | Accumulated Other Comprehensive Income (Loss) | Treasury Stock | Total Attributed To Stockholders | Non- controlling Interests |
Beginning Balance (in shares) at Dec. 31, 2018 | 6,997,382 | 1,150,000 | 3,555,242 | ||||||
Beginning Balance at Dec. 31, 2018 | $ 643,867 | $ 106 | $ 110,843 | $ 1,209,805 | $ (310,865) | $ (731) | $ (379,249) | $ 629,909 | $ 13,958 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income (loss) | 72,460 | 72,757 | 72,757 | (297) | |||||
Foreign currency translation adjustments | (14) | (14) | (14) | ||||||
Net subscriptions (redemptions) and other | (911) | 838 | 838 | (1,749) | |||||
Reclassification from other comprehensive (income) loss | 726 | 726 | 726 | ||||||
Cash dividends declared, preferred | (6,253) | (6,253) | (6,253) | ||||||
Cash dividends declared, common | (13,228) | (13,228) | (13,228) | ||||||
Repurchases of common shares (in shares) | (286,620) | (286,620) | |||||||
Repurchases of common shares | (30,000) | $ (30,000) | (30,000) | ||||||
Issuance of common shares related to employee stock transactions (in shares) | 166,834 | ||||||||
Issuance of common shares related to employee stock transactions | 1,430 | $ 1 | 1,429 | 1,430 | |||||
Taxes paid on stock-based compensation | (6,601) | (6,601) | (6,601) | ||||||
Stock-based compensation | 16,140 | 16,140 | 16,140 | ||||||
Ending Balance (in shares) at Sep. 30, 2019 | 6,877,596 | 1,150,000 | 3,841,862 | ||||||
Ending Balance at Sep. 30, 2019 | 677,616 | $ 107 | $ 110,843 | 1,202,130 | (238,108) | (19) | $ (409,249) | 665,704 | 11,912 |
Beginning Balance at Dec. 31, 2018 | 57,481 | ||||||||
Increase (Decrease) in Redeemable Non-controlling Interests [Roll Forward] | |||||||||
Total net income (loss) attributable to noncontrolling interests | 3,266 | ||||||||
Net subscriptions (redemptions) and other | 30,863 | ||||||||
Ending Balance at Sep. 30, 2019 | 91,610 | ||||||||
Beginning Balance (in shares) at Jun. 30, 2019 | 6,944,892 | 1,150,000 | 3,770,913 | ||||||
Beginning Balance at Jun. 30, 2019 | 663,672 | $ 107 | $ 110,843 | 1,204,033 | (262,193) | (7) | $ (401,748) | 651,035 | 12,637 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income (loss) | 24,017 | 24,085 | 24,085 | (68) | |||||
Foreign currency translation adjustments | (12) | (12) | (12) | ||||||
Net subscriptions (redemptions) and other | (109) | 548 | 548 | (657) | |||||
Cash dividends declared, preferred | (2,085) | (2,085) | (2,085) | ||||||
Cash dividends declared, common | (4,972) | (4,972) | (4,972) | ||||||
Repurchases of common shares (in shares) | (70,949) | (70,949) | |||||||
Repurchases of common shares | (7,501) | $ (7,501) | (7,501) | ||||||
Issuance of common shares related to employee stock transactions (in shares) | 3,653 | ||||||||
Issuance of common shares related to employee stock transactions | 5 | $ 0 | 5 | 5 | |||||
Taxes paid on stock-based compensation | (93) | (93) | (93) | ||||||
Stock-based compensation | 4,694 | 4,694 | 4,694 | ||||||
Ending Balance (in shares) at Sep. 30, 2019 | 6,877,596 | 1,150,000 | 3,841,862 | ||||||
Ending Balance at Sep. 30, 2019 | 677,616 | $ 107 | $ 110,843 | 1,202,130 | (238,108) | (19) | $ (409,249) | 665,704 | 11,912 |
Beginning Balance at Jun. 30, 2019 | 60,502 | ||||||||
Increase (Decrease) in Redeemable Non-controlling Interests [Roll Forward] | |||||||||
Total net income (loss) attributable to noncontrolling interests | 1,342 | ||||||||
Net subscriptions (redemptions) and other | 29,766 | ||||||||
Ending Balance at Sep. 30, 2019 | 91,610 | ||||||||
Beginning Balance (in shares) at Dec. 31, 2019 | 6,809,280 | 1,150,000 | 3,927,607 | ||||||
Beginning Balance at Dec. 31, 2019 | 686,257 | $ 107 | $ 110,843 | 1,199,205 | (215,216) | 9 | $ (419,249) | 675,699 | 10,558 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income (loss) | 36,496 | 36,642 | 36,642 | (146) | |||||
Foreign currency translation adjustments | (9) | (9) | (9) | ||||||
Net subscriptions (redemptions) and other | (1,597) | (167) | (167) | (1,430) | |||||
Conversion of preferred stock (in shares) | 912,806 | (1,150,000) | |||||||
Conversion of preferred stock | 0 | $ 9 | $ (110,843) | 110,834 | 0 | ||||
Cash dividends declared, preferred | $ (18,371) | (18,371) | (18,371) | ||||||
Repurchases of common shares (in shares) | (239,720) | (239,720) | (239,720) | ||||||
Repurchases of common shares | $ (25,000) | $ (25,000) | (25,000) | ||||||
Issuance of common shares related to employee stock transactions (in shares) | 130,788 | ||||||||
Issuance of common shares related to employee stock transactions | 163 | $ 2 | 161 | 163 | |||||
Taxes paid on stock-based compensation | (5,693) | (5,693) | (5,693) | ||||||
Stock-based compensation | 15,766 | 15,766 | 15,766 | ||||||
Ending Balance (in shares) at Sep. 30, 2020 | 7,613,154 | 0 | 4,167,327 | ||||||
Ending Balance at Sep. 30, 2020 | 688,012 | $ 118 | $ 0 | 1,301,735 | (178,574) | 0 | $ (444,249) | 679,030 | 8,982 |
Beginning Balance at Dec. 31, 2019 | 63,845 | ||||||||
Increase (Decrease) in Redeemable Non-controlling Interests [Roll Forward] | |||||||||
Total net income (loss) attributable to noncontrolling interests | 21,653 | ||||||||
Net subscriptions (redemptions) and other | 13,779 | ||||||||
Ending Balance at Sep. 30, 2020 | 99,277 | ||||||||
Beginning Balance (in shares) at Jun. 30, 2020 | 7,664,272 | 0 | 4,113,460 | ||||||
Beginning Balance at Jun. 30, 2020 | 666,511 | $ 118 | $ 0 | 1,303,036 | (208,222) | (17) | $ (436,749) | 658,166 | 8,345 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income (loss) | 30,625 | 29,648 | 29,648 | 977 | |||||
Foreign currency translation adjustments | 17 | 17 | 17 | ||||||
Net subscriptions (redemptions) and other | (340) | 0 | 0 | (340) | |||||
Cash dividends declared, common | $ (6,695) | (6,695) | (6,695) | ||||||
Repurchases of common shares (in shares) | (53,867) | (53,867) | (53,867) | ||||||
Repurchases of common shares | $ (7,500) | $ (7,500) | (7,500) | ||||||
Issuance of common shares related to employee stock transactions (in shares) | 2,749 | ||||||||
Issuance of common shares related to employee stock transactions | 49 | $ 0 | 49 | 49 | |||||
Taxes paid on stock-based compensation | (124) | (124) | (124) | ||||||
Stock-based compensation | 5,469 | 5,469 | 5,469 | ||||||
Ending Balance (in shares) at Sep. 30, 2020 | 7,613,154 | 0 | 4,167,327 | ||||||
Ending Balance at Sep. 30, 2020 | 688,012 | $ 118 | $ 0 | $ 1,301,735 | $ (178,574) | $ 0 | $ (444,249) | $ 679,030 | $ 8,982 |
Beginning Balance at Jun. 30, 2020 | 90,687 | ||||||||
Increase (Decrease) in Redeemable Non-controlling Interests [Roll Forward] | |||||||||
Total net income (loss) attributable to noncontrolling interests | 10,309 | ||||||||
Net subscriptions (redemptions) and other | (1,719) | ||||||||
Ending Balance at Sep. 30, 2020 | $ 99,277 |
Condensed Consolidated Statem_6
Condensed Consolidated Statements of Changes in Equity (Parenthetical) - $ / shares | 3 Months Ended | 9 Months Ended |
Sep. 30, 2019 | Sep. 30, 2019 | |
Statement of Stockholders' Equity [Abstract] | ||
Cash dividends declared per preferred share (in $ per share) | $ 1.81 | $ 5.44 |
Cash dividends declared per common share (in $ per share) | $ 0.67 | $ 1.77 |
Organization and Business
Organization and Business | 9 Months Ended |
Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Business | Organization and Business Virtus Investment Partners, Inc. (the "Company," "we," "us," "our" or "Virtus"), a Delaware corporation, operates in the investment management industry through its subsidiaries. The Company provides investment management and related services to individuals and institutions. The Company’s retail investment management services are provided to individuals through products consisting of U.S. 1940 Act mutual funds and Undertaking for Collective Investment in Transferable Securities ("UCITS" or "offshore funds" and collectively, with U.S. 1940 Act mutual funds, "open-end funds"), exchange traded funds ("ETFs"), closed-end funds (collectively, with open-end funds and ETFs, "funds") and retail separate accounts. Institutional investment management services are offered through separate accounts and pooled or commingled structures to a variety of institutional clients. The Company also provides subadvisory services to other investment advisers and serves as the collateral manager for structured products. |
Basis of Presentation and Signi
Basis of Presentation and Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Significant Accounting Policies | Basis of Presentation and Significant Accounting Policies Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, these financial statements contain all adjustments, consisting only of normal recurring adjustments, necessary for a fair statement of the Company’s financial condition and results of operations. Operating results for the nine months ended September 30, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 ("2019 Annual Report on Form 10-K") filed with the Securities and Exchange Commission (the "SEC"). The Company’s significant accounting policies, which have been consistently applied, are summarized in its 2019 Annual Report on Form 10-K. New Accounting Standards Implemented In August 2018, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40) . This standard aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software, including an internal-use software license. The Company adopted this standard on January 1, 2020. The adoption of this standard did not have a material impact on the Company's condensed consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820) . This standard modifies the disclosure requirements on fair value measurements. The Company adopted this standard on January 1, 2020. The adoption of this standard did not have a material impact on the Company's condensed consolidated financial statements. New Accounting Standards Not Yet Implemented In January 2020, the FASB issued ASU 2020-01, Investments - Equity Securities (Topic 321), Investments-Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) . This standard clarifies the interaction of the accounting for equity securities under Topic 321, the accounting for equity method investments in Topic 323, and the accounting for certain forward contracts and purchased options in Topic 815. This standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early adoption is permitted, with the amendments to be applied on a prospective basis. The Company is currently evaluating the impact of adopting this standard on its condensed consolidated financial statements. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes . This standard simplifies the accounting for income taxes by removing certain exceptions to the general principles of Topic 740, Income Taxes, and also improves consistent application by clarifying and amending existing guidance. This standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early adoption is permitted, with the amendments to be applied on a retrospective, modified retrospective or prospective basis, depending on the specific amendment. The Company has evaluated the impact of adopting this standard and, at this time, does not anticipate it will have a material impact on its condensed consolidated financial statements. |
Revenues
Revenues | 9 Months Ended |
Sep. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | Revenues The Company's revenues are recognized when a performance obligation is satisfied, which occurs when control of the services is transferred to customers. Investment management fees, distribution and service fees, and administration and shareholder service fees are generally calculated as a percentage of average net assets of the investment portfolios managed. The net asset values from which investment management, distribution and service, and administration and shareholder service fees are calculated are variable in nature and subject to factors outside of the Company's control such as additional investments, withdrawals and market performance. Because of this, these fees are considered constrained until the end of the contractual measurement period (monthly or quarterly), which is when asset values are generally determinable. Revenue Disaggregated by Source The following table summarizes revenue by source: Three Months Ended Nine Months Ended (in thousands) 2020 2019 2020 2019 Investment management fees Open-end funds $ 63,458 $ 59,060 $ 176,584 $ 169,326 Closed-end funds 8,959 10,846 27,695 31,485 Retail separate accounts 26,412 22,092 74,524 60,761 Institutional accounts 29,048 25,180 76,571 71,013 Structured products 1,297 1,725 3,288 4,957 Other products 611 1,120 1,961 2,990 Total investment management fees 129,785 120,023 360,623 340,532 Distribution and service fees 9,797 10,442 28,146 31,122 Administration and shareholder service fees 15,114 15,280 43,056 44,747 Other income and fees 94 210 425 761 Total revenues $ 154,790 $ 145,955 $ 432,250 $ 417,162 |
Intangible Assets, Net
Intangible Assets, Net | 9 Months Ended |
Sep. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets, Net | Intangible Assets, Net Below is a summary of intangible assets, net: (in thousands) September 30, 2020 December 31, 2019 Definite-lived intangible assets: Investment contracts and other $ 489,570 $ 489,570 Accumulated amortization (245,293) (222,695) Definite-lived intangible assets, net 244,277 266,875 Indefinite-lived intangible assets 43,516 43,516 Total intangible assets, net $ 287,793 $ 310,391 Activity in intangible assets, net was as follows: Nine Months Ended September 30, (in thousands) 2020 2019 Intangible assets, net Balance, beginning of period $ 310,391 $ 338,812 Additions — 1,823 Amortization (22,598) (22,711) Balance, end of period $ 287,793 $ 317,924 Definite-lived intangible asset amortization for the remainder of fiscal year 2020 and succeeding fiscal years is estimated as follows: Fiscal Year Amount (in thousands) Remainder of 2020 7,529 2021 30,116 2022 29,992 2023 29,330 2024 23,689 2025 and thereafter 123,621 $ 244,277 |
Investments
Investments | 9 Months Ended |
Sep. 30, 2020 | |
Schedule of Investments [Abstract] | |
Investments | Investments Investments consist primarily of investments in the Company's sponsored products. The Company's investments, excluding the assets of consolidated investment products ("CIP") discussed in Note 15, at September 30, 2020 and December 31, 2019 were as follows: (in thousands) September 30, 2020 December 31, 2019 Investment securities - fair value $ 31,641 $ 60,990 Equity method investments (1) 12,039 12,030 Nonqualified retirement plan assets 9,302 8,724 Other investments 1,464 1,462 Total investments $ 54,446 $ 83,206 (1) The Company's equity method investments are valued on a three-month lag based upon the availability of financial information. Investment Securities - fair value Investment securities - fair value consist of investments in the Company's sponsored funds, separately managed accounts and trading debt securities. The composition of the Company’s investment securities - fair value was as follows: September 30, 2020 December 31, 2019 (in thousands) Cost Fair Value Cost Fair Value Investment Securities - fair value Sponsored funds $ 21,075 $ 22,043 $ 44,588 $ 47,654 Equity securities 7,105 9,594 11,250 13,320 Debt securities 7 4 44 16 Total investment securities - fair value $ 28,187 $ 31,641 $ 55,882 $ 60,990 For the three and nine months ended September 30, 2020, the Company recognized realized gains of $4.5 million and |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The Company’s assets and liabilities measured at fair value on a recurring basis, excluding the assets and liabilities of CIP discussed in Note 15, as of September 30, 2020 and December 31, 2019 by fair value hierarchy level were as follows: September 30, 2020 (in thousands) Level 1 Level 2 Level 3 Total Assets Cash equivalents $ 170,763 $ — $ — $ 170,763 Investment securities - fair value Sponsored funds 22,043 — — 22,043 Equity securities 9,594 — — 9,594 Debt securities — 4 — 4 Nonqualified retirement plan assets 9,302 — — 9,302 Total assets measured at fair value $ 211,702 $ 4 $ — $ 211,706 December 31, 2019 (in thousands) Level 1 Level 2 Level 3 Total Assets Cash equivalents $ 187,255 $ — $ — $ 187,255 Investment securities - fair value Sponsored funds 47,654 — — 47,654 Equity securities 13,320 — — 13,320 Debt securities — 16 — 16 Nonqualified retirement plan assets 8,724 — — 8,724 Total assets measured at fair value $ 256,953 $ 16 $ — $ 256,969 The following is a discussion of the valuation methodologies used for the Company’s assets measured at fair value: Cash equivalents represent investments in money market funds. Cash investments in money market funds are valued using published net asset values and are classified as Level 1. Sponsored funds represent investments in open-end funds, closed-end funds and ETFs for which the Company acts as the investment manager. The fair value of open-end funds is determined based on their published net asset values and are categorized as Level 1. The fair value of closed-end funds and ETFs is determined based on the official closing price on the exchange on which they are traded and are categorized as Level 1. Equity securities represent securities traded on active markets and are valued at the official closing price (typically the last sale or bid) on the exchange on which the securities are primarily traded and are categorized as Level 1. Debt securities represent investments in senior secured bank loans and are based on evaluated quotations received from independent pricing services and are categorized as Level 2. Nonqualified retirement plan assets represent mutual funds within a nonqualified retirement plan whose fair value is determined based on their published net asset value and are categorized as Level 1. Cash, accounts receivable, accounts payable and accrued liabilities equal or approximate fair value based on the short-term nature of these instruments. The Company had no Level 3 investments for the three- and nine-month periods ended September 30, 2020 and no Level 3 investments for the three months ended September 30, 2019. The following table is a reconciliation of assets for Level 3 investments for which significant unobservable inputs were used to determine fair value for the nine months ended September 30, 2019: Nine Months Ended September 30, (in thousands) 2019 Level 3 Investments (1) Balance at beginning of period $ 4,122 Purchases (sales), net (4,185) Change in realized and unrealized gain (loss), net 63 Balance at end of period $ — (1) The investments that are categorized as Level 3 were valued utilizing third-party pricing information without adjustment. |
Equity Transactions
Equity Transactions | 9 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
Equity Transactions | Equity Transactions Preferred Stock Conversion On February 3, 2020, 1,150,000 shares of mandatory convertible preferred stock ("MCPS") converted to 912,870 shares of the Company's common stock. Each share of MCPS converted to 0.7938 shares of common stock at a conversion price of $125.97 per share, subject to customary anti-dilution adjustments. The number of shares of common stock issued upon conversion was determined based on the volume-weighted average price per share of the Company's common stock over the 20 consecutive trading day period beginning on, and including, the 22nd scheduled trading day immediately preceding the mandatory conversion date. Dividends Declared On August 19, 2020, the Company declared a quarterly cash dividend of $0.82 per common share to be paid on November 13, 2020 to stockholders of record at the close of business on October 30, 2020. Common Stock Repurchases |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 9 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) The changes in accumulated other comprehensive income (loss) by component for the nine months ended September 30, 2020 and 2019 were as follows: (in thousands) Unrealized Gains (Losses) on Foreign Balance at December 31, 2019 $ — $ 9 Foreign currency translation adjustments, net of tax of $3 — (9) Net current-period other comprehensive income (loss) — (9) Balance at September 30, 2020 $ — $ — (in thousands) Unrealized Gains (Losses) on Foreign Balance at December 31, 2018 $ (726) $ (5) Foreign currency translation adjustments, net of tax of $5 — (14) Amounts reclassified from accumulated other comprehensive income (loss), net of tax of $(254) 726 — Net current-period other comprehensive income (loss) 726 (14) Balance at September 30, 2019 $ — $ (19) |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation Pursuant to the Company's Omnibus Incentive and Equity Plan (the "Plan"), officers, employees and directors may be granted equity-based awards, including restricted stock units ("RSUs"), performance stock units ("PSUs"), stock options and unrestricted shares of common stock. At September 30, 2020, 336,276 shares of common stock remained available for issuance of the 2,820,000 shares that are authorized for issuance under the Plan. Stock based compensation expense is summarized as follows: Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 (in thousands) Stock-based compensation expense $ 6,299 $ 5,000 $ 16,412 $ 16,384 Restricted Stock Units Each RSU entitles the holder to one share of common stock when the restriction expires. RSUs may be time-vested or performance-contingent (PSUs) that convert into RSUs after performance measurement is complete and generally vest in one RSU activity, inclusive of PSUs, for the nine months ended September 30, 2020 is summarized as follows: Number Weighted Average Outstanding at December 31, 2019 528,376 $ 115.74 Granted 211,660 $ 86.73 Forfeited (3,844) $ 118.95 Settled (181,091) $ 110.79 Outstanding at September 30, 2020 555,101 $ 106.27 For the nine months ended September 30, 2020 and 2019, a total of 63,566 and 58,487 RSUs, respectively, were withheld by the Company as a result of net share settlements to settle minimum employee tax withholding obligations. The Company paid $5.6 million and $5.9 million for the nine months ended September 30, 2020 and 2019, respectively, in minimum employee tax withholding obligations related to RSUs withheld for net share settlements. These net share settlements had the effect of share repurchases by the Company as they reduced the number of shares that would have been otherwise issued as a result of the vesting. During the nine months ended September 30, 2020, the Company granted 68,371 PSUs that contain performance-based metrics in addition to a service condition. Compensation expense for PSUs is generally recognized over a three-year service period based upon the value determined using a combination of (i) the intrinsic value method, for awards that contain a performance metric that represents a "performance condition" in accordance with ASC 718 and (ii) the Monte Carlo simulation valuation model for awards that contain a "market condition" performance metric under ASC 718. Compensation expense for PSU awards that contain a market condition is fixed at the date of grant and will not be adjusted in future periods based upon the achievement of the market condition. Compensation expense for PSU awards with a performance condition is recorded each period based upon a probability assessment of the expected outcome of the performance metric with a final adjustment upon measurement at the end of the performance period. As of September 30, 2020, unamortized stock-based compensation expense for unvested RSUs and PSUs was $27.2 million, with a weighted-average remaining amortization period of 1.4 years. |
Earnings (Loss) Per Share
Earnings (Loss) Per Share | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
Earnings (Loss) Per Share | Earnings (Loss) Per Share Basic earnings (loss) per share ("EPS") is computed by dividing net income (loss) attributable to common stockholders by the weighted-average number of common shares outstanding for the period, excluding dilution for potential common stock issuances. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock, including: (i) shares issuable upon the vesting of RSUs and stock option exercises using the treasury stock method and (ii) shares issuable upon the conversion of the MCPS, as determined under the if-converted method. For purposes of calculating diluted EPS, preferred stock dividends have been subtracted from net income (loss) in periods in which utilizing the if-converted method would be anti-dilutive. The computation of basic and diluted EPS is as follows: Three Months Ended September 30, Nine Months Ended (in thousands, except per share amounts) 2020 2019 2020 2019 Net Income (Loss) $ 40,934 $ 25,359 $ 58,149 $ 75,726 Noncontrolling interests (11,286) (1,274) (21,507) (2,969) Net Income (Loss) Attributable to Stockholders 29,648 24,085 36,642 72,757 Preferred stock dividends — (2,085) — (6,253) Net Income (Loss) Attributable to Common Stockholders $ 29,648 $ 22,000 $ 36,642 $ 66,504 Shares: Basic: Weighted-average number of shares outstanding 7,684 6,947 7,611 6,990 Plus: Incremental shares from assumed conversion of dilutive instruments 313 1,210 347 1,225 Diluted: Weighted-average number of shares outstanding 7,997 8,157 7,958 8,215 Earnings (Loss) per Share—Basic $ 3.86 $ 3.17 $ 4.81 $ 9.51 Earnings (Loss) per Share—Diluted $ 3.71 $ 2.95 $ 4.60 $ 8.86 The following table details the securities that have been excluded from the above computation of weighted-average number of shares for diluted EPS, because the effect would be anti-dilutive: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2020 2019 2020 2019 Restricted stock units and options 1 32 — 29 Total anti-dilutive securities 1 32 — 29 |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income TaxesIn calculating the provision for income taxes, the Company uses an estimate of the annual effective tax rate based upon the facts and circumstances at each interim period. On a quarterly basis, the estimated annual effective tax rate is adjusted, as appropriate, based upon changes in facts and circumstances, if any, as compared to those forecasted at the beginning of the fiscal year and at each interim period thereafter.The provision for income taxes reflected U.S. federal, state and local taxes at an estimated effective tax rate of 33.9% and 24.0% for the nine months ended September 30, 2020 and 2019, respectively. The comparatively higher estimated effective tax rate for the nine months ended September 30, 2020 was primarily due to valuation allowances recorded for the tax effects of unrealized losses on certain Company investments. |
Debt
Debt | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
Debt | Debt C redit Agreement The Company's credit agreement, as amended (the "Credit Agreement"), is comprised of (i) $365.0 million of seven-year term debt (the "Term Loan") expiring in June 2024 and (ii) a $100.0 million five-year revolving credit facility (the "Credit Facility") expiring in June 2022. During the nine months ended September 30, 2020, the Company reduced its Term Loan by $62.5 million, including the retirement of $10.0 million of principal for $8.9 million from certain debt holders in accordance with the prepayment provisions in the Credit Agreement. At September 30, 2020, $223.2 million was outstanding under the Term Loan, and the Company had no outstanding borrowings under its Credit Facility. In accordance with ASC 835, Interest, the amounts outstanding under the Company's Term Loan are presented on the Condensed Consolidated Balance Sheet net of related debt issuance costs, which were $5.2 million as of September 30, 2020. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Legal Matters The Company is involved from time to time in litigation and arbitration, as well as examinations, inquiries and investigations by various regulatory bodies, including the SEC, involving its compliance with, among other things, securities laws, client investment guidelines, laws governing the activities of broker-dealers and other laws and regulations affecting its products and other activities. Legal and regulatory matters of this nature involve or may involve but are not limited to the Company’s activities as an employer, issuer of securities, investor, investment adviser, broker-dealer or taxpayer. In addition, in the normal course of business, the Company discusses matters with its regulators raised during regulatory examinations or is otherwise subject to their inquiry. These matters could result in censures, fines, penalties or other sanctions. The Company records a liability when it is both probable that a liability has been incurred and the amount of the liability can be reasonably estimated. Significant judgment is required in both the determination of probability and the determination as to whether a loss is reasonably estimable. In addition, in the event the Company determines that a loss is not probable, but is reasonably possible, and it becomes possible to develop what the Company believes to be a reasonable range of possible loss, then the Company will include disclosures related to such matter as appropriate and in compliance with ASC 450, Contingencies. The disclosures, accruals or estimates, if any, resulting from the foregoing analysis are reviewed at least quarterly and adjusted to reflect the impact of negotiations, settlements, rulings, advice of legal counsel and other information and events pertaining to a particular matter. Based on information currently available, available insurance coverage, indemnities and established reserves, the Company believes that the outcomes of its legal and regulatory proceedings are not likely, either individually or in the aggregate, to have a material adverse effect on the Company’s results of operations, cash flows or its consolidated financial condition. However, in the event of unexpected subsequent developments and given the inherent unpredictability of these legal and regulatory matters, the Company can provide no assurance that its assessment of any claim, dispute, regulatory examination or investigation or other legal matter will reflect the ultimate outcome, and an adverse outcome in certain matters could, from time to time, have a material adverse effect on the Company’s results of operations or cash flows in particular quarterly or annual periods. |
Redeemable Noncontrolling Inter
Redeemable Noncontrolling Interests | 9 Months Ended |
Sep. 30, 2020 | |
Noncontrolling Interest [Abstract] | |
Redeemable Noncontrolling Interests | Redeemable Noncontrolling InterestsRedeemable noncontrolling interests represent third-party investments in the Company's CIP and minority interests held in a consolidated majority-owned affiliate. Minority interests held in the affiliate are subject to holder put rights and Company call rights at established multiples of earnings before interest, taxes, depreciation and amortization and, as such, are considered redeemable at other than fair value. The rights are exercisable at pre-established intervals (between four Redeemable noncontrolling interests for the nine months ended September 30, 2020 included the following amounts: (in thousands) CIP Affiliate Noncontrolling Interests Total Balances at December 31, 2019 $ 5,429 $ 58,416 $ 63,845 Net income (loss) attributable to noncontrolling interests (852) 3,474 2,622 Changes in redemption value (1) — 19,031 19,031 Total net income (loss) attributable to noncontrolling interests (852) 22,505 21,653 Net subscriptions (redemptions) and other 20,074 (6,295) 13,779 Balances at September 30, 2020 $ 24,651 $ 74,626 $ 99,277 (1) Relates to noncontrolling interests redeemable at other than fair value. |
Consolidation
Consolidation | 9 Months Ended |
Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Consolidation | Consolidation The condensed consolidated financial statements include the accounts of the Company, its subsidiaries and investment products that are consolidated. Voting interest entities ("VOEs") are consolidated when the Company is considered to have a controlling financial interest, which is typically present when the Company owns a majority of the voting interest in an entity or otherwise has the power to govern the financial and operating policies of the entity. The Company evaluates any variable interest entities ("VIEs") in which the Company has a variable interest for consolidation. A VIE is an entity in which either (i) the equity investment at risk is not sufficient to permit the entity to finance its own activities without additional financial support or (ii) where as a group, the holders of the equity investment at risk do not possess (x) the power through voting or similar rights to direct the activities that most significantly impact the entity’s economic performance; (y) the obligation to absorb expected losses or the right to receive expected residual returns of the entity; or (z) proportionate voting and economic interests and where substantially all of the entity’s activities either involve or are conducted on behalf of an investor with disproportionately fewer voting rights. If an entity has any of these characteristics, it is considered a VIE and is required to be consolidated by its primary beneficiary. The primary beneficiary is the entity that has both the power to direct the activities that most significantly impact the VIE’s economic performance and has the obligation to absorb losses of, or the right to receive benefits from, the VIE that could potentially be significant to the VIE. In the normal course of its business, the Company sponsors various investment products, some of which are consolidated by the Company. CIP includes both VOEs, made up primarily of open-end funds in which the Company holds a controlling financial interest, and VIEs, which primarily consist of CLOs of which the Company is considered the primary beneficiary. The consolidation and deconsolidation of these investment products have no impact on net income (loss) attributable to stockholders. The Company’s risk with respect to these investment products is limited to its beneficial interests in these products. The Company has no right to the benefits from, and does not bear the risks associated with, these investment products beyond the Company’s investments in, and fees generated from, these products. The following table presents the balances of CIP that, after intercompany eliminations, were reflected on the Condensed Consolidated Balance Sheets as of September 30, 2020 and December 31, 2019: As of September 30, 2020 December 31, 2019 VIEs VIEs (in thousands) VOEs CLOs Other VOEs CLOs Other Cash and cash equivalents $ 9,128 $ 43,930 $ 1,177 $ 2,665 $ 97,130 $ 363 Investments 46,623 2,231,691 55,371 22,223 1,976,148 31,739 Other assets 2,756 23,821 838 1,563 21,450 599 Notes payable — (2,190,937) — — (1,834,535) — Securities purchased payable and other liabilities (2,972) (37,378) (670) (2,964) (164,887) (200) Noncontrolling interests (22,362) (8,982) (2,289) (3,865) (10,558) (1,564) Net interests in CIP $ 33,173 $ 62,145 $ 54,427 $ 19,622 $ 84,748 $ 30,937 Consolidated CLOs The majority of the Company's CIP that are VIEs are CLOs. At September 30, 2020, the Company consolidated six CLOs. The financial information of certain CLOs is included on the Company's condensed consolidated financial statements on a one-month lag based upon the availability of the fund financial information. A majority-owned consolidated private fund, whose primary purpose is to invest in CLOs for which the Company serves as the collateral manager, is also included. Investments of CLOs The CLOs held investments of $2.2 billion at September 30, 2020 consisting of bank loan investments, which comprise the majority of the CLOs' portfolio asset collateral and are senior secured corporate loans across a variety of industries. These bank loan investments mature at various dates between 2020 and 2028 and pay interest at LIBOR plus a spread of up to 12.00%. The CLOs may elect to reinvest any prepayments received on bank loan investments up until the periods between October 2019 and March 2025, depending on the CLO. Generally, subsequent prepayments received after the reinvestment period must be used to pay down the note obligations. At September 30, 2020, the fair value of the senior bank loans was less than the unpaid principal balance by $135.8 million. At September 30, 2020, there were no material collateral assets in default. Notes Payable of CLOs The CLOs held notes payable with a total value, at par, of $2.5 billion at September 30, 2020, consisting of senior secured floating rate notes payable with a par value of $2.2 billion and subordinated notes with a par value of $225.9 million. These note obligations bear interest at variable rates based on LIBOR plus a pre-defined spread ranging from 0.8% to 8.7%. The principal amounts outstanding of these note obligations mature on dates ranging from October 2027 to January 2033. The Company’s beneficial interests and maximum exposure to loss related to these consolidated CLOs is limited to (i) ownership in the subordinated notes and (ii) accrued management fees. The secured notes of the consolidated CLOs have contractual recourse only to the related assets of the CLO and are classified as financial liabilities. Although these beneficial interests are eliminated upon consolidation, the application of the measurement alternative prescribed by ASU 2014-13, Consolidation (Topic 810) ("ASU 2014-13") results in the net assets of the consolidated CLOs shown above to be equivalent to the beneficial interests retained by the Company at September 30, 2020, as shown in the table below: (in thousands) Subordinated notes $ 60,721 Accrued investment management fees 1,424 Total beneficial interests $ 62,145 The following table represents income and expenses of the consolidated CLOs included on the Company’s Condensed Consolidated Statements of Operations for the period indicated: (in thousands) Nine Months Ended September 30, 2020 Income: Realized and unrealized gain (loss), net $ (9,648) Interest income 81,846 Total income 72,198 Expenses: Other operating expenses 9,535 Interest expense 70,258 Total expense 79,793 Noncontrolling interests 146 Net Income (loss) attributable to CIP $ (7,449) As summarized in the table below, the application of the measurement alternative as prescribed by ASU 2014-13 results in the consolidated net income summarized above to be equivalent to the Company’s own economic interests in the consolidated CLOs, which are eliminated upon consolidation: (in thousands) Nine Months Ended September 30, 2020 Distributions received and unrealized gains (losses) on the subordinated notes held by the Company $ (13,941) Investment management fees 6,492 Total economic interests $ (7,449) Fair Value Measurements of CIP The assets and liabilities of CIP measured at fair value on a recurring basis as of September 30, 2020 and December 31, 2019 by fair value hierarchy level were as follows: As of September 30, 2020 (in thousands) Level 1 Level 2 Level 3 Total Assets Cash equivalents $ 43,930 $ — $ — $ 43,930 Debt investments 14,472 2,275,610 13,326 2,303,408 Equity investments 27,092 1,349 1,836 30,277 Derivatives 586 845 — 1,431 Total assets measured at fair value $ 86,080 $ 2,277,804 $ 15,162 $ 2,379,046 Liabilities Notes payable $ — $ 2,190,937 $ — $ 2,190,937 Derivatives 539 433 — 972 Short sales 472 — — 472 Total liabilities measured at fair value $ 1,011 $ 2,191,370 $ — $ 2,192,381 As of December 31, 2019 (in thousands) Level 1 Level 2 Level 3 Total Assets Cash equivalents $ 97,130 $ — $ — $ 97,130 Debt investments 218 1,973,427 39,389 2,013,034 Equity investments 15,872 171 1,033 17,076 Total assets measured at fair value $ 113,220 $ 1,973,598 $ 40,422 $ 2,127,240 Liabilities Notes payable $ — $ 1,834,535 $ — $ 1,834,535 Short sales 430 — — 430 Total liabilities measured at fair value $ 430 $ 1,834,535 $ — $ 1,834,965 The following is a discussion of the valuation methodologies used for the assets and liabilities of the Company’s CIP measured at fair value: Cash equivalents represent investments in money ma rket funds. Cash investments in money market funds are valued using published net asset values and are classified as Level 1. Debt and equity investments represent the underlying debt, equity and other securities held in CIP. Equity investments are valued at the official closing price on the exchange on which the securities are traded and are generally categorized within Level 1. Level 2 investments represent most debt securities, including bank loans and certain equity securities (including non-U.S. securities), for which closing prices are not readily available or are deemed to not reflect readily available market prices, and are valued using an independent pricing service. Debt investments are valued based on quotations received from independent pricing services or from dealers who make markets in such securities. Bank loan investments, which are included as debt investments, are generally priced at the average mid-point of bid and ask quotations obtained from a third-party pricing service. Fair value may also be based upon valuations obtained from independent third-party brokers or dealers utilizing matrix pricing models that consider information regarding securities with similar characteristics. In certain instances, fair value has been determined utilizing discounted cash flow analyses or single broker non-binding quotes. Depending on the nature of the inputs, these assets are classified as Level 1, 2 or 3 within the fair value measurement hierarchy. Level 3 investments include debt and equity securities that are not widely traded, are illiquid or are priced by dealers based on pricing models used by market makers in the security. Derivative assets and liabilities represent futures contracts, swaps contracts, option contracts and forward contracts held in CIP. Derivative instruments in an asset position are classified as other assets of CIP on the Condensed Consolidated Balance Sheets. Derivative instruments in a liability position are classified as liabilities of CIP within the Condensed Consolidated Balance Sheets. The change in fair value of such derivatives is recorded in realized and unrealized gain (loss) on investments of CIP, net, on the Condensed Consolidated Statements of Operations. Depending on the nature of the inputs, these derivative assets and liabilities are classified as Level 1, 2 or 3 within the fair value measurement hierarchy. In connection with entering into these derivative contracts, these CIP may be required to pledge an amount of cash equal to the appropriate “initial margin” requirements. The cash pledged or on deposit is recorded on the Condensed Consolidated Balance Sheets of the Company as Cash pledged or on deposit of CIP. The fair value of such derivatives at September 30, 2020 was immaterial. Notes payable represent notes issued by CIP CLOs and are measured using the measurement alternative in ASU 2014-13. Accordingly, the fair value of CLO liabilities was measured as the fair value of CLO assets less the sum of (i) the fair value of the beneficial interests held by the Company and (ii) the carrying value of any beneficial interests that represent compensation for services. The fair value of the beneficial interests held by the Company is based on third-party pricing information without adjustment. Short sales are transactions in which a security is sold that is not owned or is owned but there is no intention to deliver, in anticipation that the price of the security will decline. Short sales are recorded on the Condensed Consolidated Balance Sheets within other liabilities of CIP and are classified as Level 1 based on the underlying equity security. The securities purchase payable at September 30, 2020 and December 31, 2019 approximated fair value due to the short-term nature of the instruments. The following table is a reconciliation of assets of CIP for Level 3 investments for which significant unobservable inputs were used to determine fair value: Nine Months Ended September 30, (in thousands) 2020 2019 Level 3 Investments of CIP (1) Balance at beginning of period $ 40,422 $ 6,848 Realized gains (losses), net 5 (95) Change in unrealized gains (losses), net (335) 310 Purchases 1,137 2,157 Amortization 9 (16) Sales (1,256) (5,414) Transfers to Level 2 (50,463) (42,232) Transfers from Level 2 25,643 51,544 Balance at end of period $ 15,162 $ 13,102 (1) The investments that are categorized as Level 3 were valued utilizing third-party pricing information without adjustment. Transfers between Level 2 and Level 3 were due to trading activities at period end. Nonconsolidated VIEs The Company serves as the collateral manager for other collateralized loan and collateralized bond obligations (collectively, "CDOs") that are not consolidated. The assets and liabilities of these CDOs reside in bankruptcy remote, special purpose entities in which the Company has no ownership of, nor holds any notes issued by, the CDOs, and provides neither recourse nor guarantees. The Company has determined that the investment management fees it receives for serving as collateral manager for these CDOs did not represent a variable interest since (i) the fees the Company earns are compensation for services provided and are commensurate with the level of effort required to provide the investment management services, (ii) the Company does not hold other interests in the CDOs that individually, or in the aggregate, would absorb more than an insignificant amount of the CDOs' expected losses or receive more than an insignificant amount of the CDOs' expected residual return, and (iii) the investment management arrangement only includes terms, conditions and amounts that are customarily present in arrangements for similar services negotiated at arm's length. |
Basis of Presentation and Sig_2
Basis of Presentation and Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, these financial statements contain all adjustments, consisting only of normal recurring adjustments, necessary for a fair statement of the Company’s financial condition and results of operations. Operating results for the nine months ended September 30, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 ("2019 Annual Report on Form 10-K") filed with the Securities and Exchange Commission (the "SEC"). The Company’s significant accounting policies, which have been consistently applied, are summarized in its 2019 Annual Report on Form 10-K. |
New Accounting Standards Implemented and Not Yet Implemented | New Accounting Standards Implemented In August 2018, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") 2018-15, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40) . This standard aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software, including an internal-use software license. The Company adopted this standard on January 1, 2020. The adoption of this standard did not have a material impact on the Company's condensed consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820) . This standard modifies the disclosure requirements on fair value measurements. The Company adopted this standard on January 1, 2020. The adoption of this standard did not have a material impact on the Company's condensed consolidated financial statements. New Accounting Standards Not Yet Implemented In January 2020, the FASB issued ASU 2020-01, Investments - Equity Securities (Topic 321), Investments-Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815) . This standard clarifies the interaction of the accounting for equity securities under Topic 321, the accounting for equity method investments in Topic 323, and the accounting for certain forward contracts and purchased options in Topic 815. This standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early adoption is permitted, with the amendments to be applied on a prospective basis. The Company is currently evaluating the impact of adopting this standard on its condensed consolidated financial statements. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes . This standard simplifies the accounting for income taxes by removing certain exceptions to the general principles of Topic 740, Income Taxes, and also improves consistent application by clarifying and amending existing guidance. This standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early adoption is permitted, with the amendments to be applied on a retrospective, modified retrospective or prospective basis, depending on the specific amendment. The Company has evaluated the impact of adopting this standard and, at this time, does not anticipate it will have a material impact on its condensed consolidated financial statements. |
Fair Value Measurements | The following is a discussion of the valuation methodologies used for the Company’s assets measured at fair value: Cash equivalents represent investments in money market funds. Cash investments in money market funds are valued using published net asset values and are classified as Level 1. Sponsored funds represent investments in open-end funds, closed-end funds and ETFs for which the Company acts as the investment manager. The fair value of open-end funds is determined based on their published net asset values and are categorized as Level 1. The fair value of closed-end funds and ETFs is determined based on the official closing price on the exchange on which they are traded and are categorized as Level 1. Equity securities represent securities traded on active markets and are valued at the official closing price (typically the last sale or bid) on the exchange on which the securities are primarily traded and are categorized as Level 1. Debt securities represent investments in senior secured bank loans and are based on evaluated quotations received from independent pricing services and are categorized as Level 2. Nonqualified retirement plan assets represent mutual funds within a nonqualified retirement plan whose fair value is determined based on their published net asset value and are categorized as Level 1. Cash, accounts receivable, accounts payable and accrued liabilities equal or approximate fair value based on the short-term nature of these instruments. Cash equivalents represent investments in money ma rket funds. Cash investments in money market funds are valued using published net asset values and are classified as Level 1. Debt and equity investments represent the underlying debt, equity and other securities held in CIP. Equity investments are valued at the official closing price on the exchange on which the securities are traded and are generally categorized within Level 1. Level 2 investments represent most debt securities, including bank loans and certain equity securities (including non-U.S. securities), for which closing prices are not readily available or are deemed to not reflect readily available market prices, and are valued using an independent pricing service. Debt investments are valued based on quotations received from independent pricing services or from dealers who make markets in such securities. Bank loan investments, which are included as debt investments, are generally priced at the average mid-point of bid and ask quotations obtained from a third-party pricing service. Fair value may also be based upon valuations obtained from independent third-party brokers or dealers utilizing matrix pricing models that consider information regarding securities with similar characteristics. In certain instances, fair value has been determined utilizing discounted cash flow analyses or single broker non-binding quotes. Depending on the nature of the inputs, these assets are classified as Level 1, 2 or 3 within the fair value measurement hierarchy. Level 3 investments include debt and equity securities that are not widely traded, are illiquid or are priced by dealers based on pricing models used by market makers in the security. Derivative assets and liabilities represent futures contracts, swaps contracts, option contracts and forward contracts held in CIP. Derivative instruments in an asset position are classified as other assets of CIP on the Condensed Consolidated Balance Sheets. Derivative instruments in a liability position are classified as liabilities of CIP within the Condensed Consolidated Balance Sheets. The change in fair value of such derivatives is recorded in realized and unrealized gain (loss) on investments of CIP, net, on the Condensed Consolidated Statements of Operations. Depending on the nature of the inputs, these derivative assets and liabilities are classified as Level 1, 2 or 3 within the fair value measurement hierarchy. In connection with entering into these derivative contracts, these CIP may be required to pledge an amount of cash equal to the appropriate “initial margin” requirements. The cash pledged or on deposit is recorded on the Condensed Consolidated Balance Sheets of the Company as Cash pledged or on deposit of CIP. The fair value of such derivatives at September 30, 2020 was immaterial. Notes payable represent notes issued by CIP CLOs and are measured using the measurement alternative in ASU 2014-13. Accordingly, the fair value of CLO liabilities was measured as the fair value of CLO assets less the sum of (i) the fair value of the beneficial interests held by the Company and (ii) the carrying value of any beneficial interests that represent compensation for services. The fair value of the beneficial interests held by the Company is based on third-party pricing information without adjustment. Short sales are transactions in which a security is sold that is not owned or is owned but there is no intention to deliver, in anticipation that the price of the security will decline. Short sales are recorded on the Condensed Consolidated Balance Sheets within other liabilities of CIP and are classified as Level 1 based on the underlying equity security. |
Consolidation and Nonconsolidated VIEs | Nonconsolidated VIEs The Company serves as the collateral manager for other collateralized loan and collateralized bond obligations (collectively, "CDOs") that are not consolidated. The assets and liabilities of these CDOs reside in bankruptcy remote, special purpose entities in which the Company has no ownership of, nor holds any notes issued by, the CDOs, and provides neither recourse nor guarantees. The Company has determined that the investment management fees it receives for serving as collateral manager for these CDOs did not represent a variable interest since (i) the fees the Company earns are compensation for services provided and are commensurate with the level of effort required to provide the investment management services, (ii) the Company does not hold other interests in the CDOs that individually, or in the aggregate, would absorb more than an insignificant amount of the CDOs' expected losses or receive more than an insignificant amount of the CDOs' expected residual return, and (iii) the investment management arrangement only includes terms, conditions and amounts that are customarily present in arrangements for similar services negotiated at arm's length. |
Revenues (Tables)
Revenues (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table summarizes revenue by source: Three Months Ended Nine Months Ended (in thousands) 2020 2019 2020 2019 Investment management fees Open-end funds $ 63,458 $ 59,060 $ 176,584 $ 169,326 Closed-end funds 8,959 10,846 27,695 31,485 Retail separate accounts 26,412 22,092 74,524 60,761 Institutional accounts 29,048 25,180 76,571 71,013 Structured products 1,297 1,725 3,288 4,957 Other products 611 1,120 1,961 2,990 Total investment management fees 129,785 120,023 360,623 340,532 Distribution and service fees 9,797 10,442 28,146 31,122 Administration and shareholder service fees 15,114 15,280 43,056 44,747 Other income and fees 94 210 425 761 Total revenues $ 154,790 $ 145,955 $ 432,250 $ 417,162 |
Intangible Assets, Net (Tables)
Intangible Assets, Net (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Intangible Assets, Net | Below is a summary of intangible assets, net: (in thousands) September 30, 2020 December 31, 2019 Definite-lived intangible assets: Investment contracts and other $ 489,570 $ 489,570 Accumulated amortization (245,293) (222,695) Definite-lived intangible assets, net 244,277 266,875 Indefinite-lived intangible assets 43,516 43,516 Total intangible assets, net $ 287,793 $ 310,391 |
Schedule of Activity in Intangible Assets, Net | Activity in intangible assets, net was as follows: Nine Months Ended September 30, (in thousands) 2020 2019 Intangible assets, net Balance, beginning of period $ 310,391 $ 338,812 Additions — 1,823 Amortization (22,598) (22,711) Balance, end of period $ 287,793 $ 317,924 |
Schedule of Estimated Amortization Expense of Intangible Assets Succeeding Years | Definite-lived intangible asset amortization for the remainder of fiscal year 2020 and succeeding fiscal years is estimated as follows: Fiscal Year Amount (in thousands) Remainder of 2020 7,529 2021 30,116 2022 29,992 2023 29,330 2024 23,689 2025 and thereafter 123,621 $ 244,277 |
Investments (Tables)
Investments (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Schedule of Investments [Abstract] | |
Summary of Investments | The Company's investments, excluding the assets of consolidated investment products ("CIP") discussed in Note 15, at September 30, 2020 and December 31, 2019 were as follows: (in thousands) September 30, 2020 December 31, 2019 Investment securities - fair value $ 31,641 $ 60,990 Equity method investments (1) 12,039 12,030 Nonqualified retirement plan assets 9,302 8,724 Other investments 1,464 1,462 Total investments $ 54,446 $ 83,206 |
Schedule of Marketable Securities | The composition of the Company’s investment securities - fair value was as follows: September 30, 2020 December 31, 2019 (in thousands) Cost Fair Value Cost Fair Value Investment Securities - fair value Sponsored funds $ 21,075 $ 22,043 $ 44,588 $ 47,654 Equity securities 7,105 9,594 11,250 13,320 Debt securities 7 4 44 16 Total investment securities - fair value $ 28,187 $ 31,641 $ 55,882 $ 60,990 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis | The Company’s assets and liabilities measured at fair value on a recurring basis, excluding the assets and liabilities of CIP discussed in Note 15, as of September 30, 2020 and December 31, 2019 by fair value hierarchy level were as follows: September 30, 2020 (in thousands) Level 1 Level 2 Level 3 Total Assets Cash equivalents $ 170,763 $ — $ — $ 170,763 Investment securities - fair value Sponsored funds 22,043 — — 22,043 Equity securities 9,594 — — 9,594 Debt securities — 4 — 4 Nonqualified retirement plan assets 9,302 — — 9,302 Total assets measured at fair value $ 211,702 $ 4 $ — $ 211,706 December 31, 2019 (in thousands) Level 1 Level 2 Level 3 Total Assets Cash equivalents $ 187,255 $ — $ — $ 187,255 Investment securities - fair value Sponsored funds 47,654 — — 47,654 Equity securities 13,320 — — 13,320 Debt securities — 16 — 16 Nonqualified retirement plan assets 8,724 — — 8,724 Total assets measured at fair value $ 256,953 $ 16 $ — $ 256,969 The assets and liabilities of CIP measured at fair value on a recurring basis as of September 30, 2020 and December 31, 2019 by fair value hierarchy level were as follows: As of September 30, 2020 (in thousands) Level 1 Level 2 Level 3 Total Assets Cash equivalents $ 43,930 $ — $ — $ 43,930 Debt investments 14,472 2,275,610 13,326 2,303,408 Equity investments 27,092 1,349 1,836 30,277 Derivatives 586 845 — 1,431 Total assets measured at fair value $ 86,080 $ 2,277,804 $ 15,162 $ 2,379,046 Liabilities Notes payable $ — $ 2,190,937 $ — $ 2,190,937 Derivatives 539 433 — 972 Short sales 472 — — 472 Total liabilities measured at fair value $ 1,011 $ 2,191,370 $ — $ 2,192,381 As of December 31, 2019 (in thousands) Level 1 Level 2 Level 3 Total Assets Cash equivalents $ 97,130 $ — $ — $ 97,130 Debt investments 218 1,973,427 39,389 2,013,034 Equity investments 15,872 171 1,033 17,076 Total assets measured at fair value $ 113,220 $ 1,973,598 $ 40,422 $ 2,127,240 Liabilities Notes payable $ — $ 1,834,535 $ — $ 1,834,535 Short sales 430 — — 430 Total liabilities measured at fair value $ 430 $ 1,834,535 $ — $ 1,834,965 |
Reconciliation of Level Three Investments | The following table is a reconciliation of assets for Level 3 investments for which significant unobservable inputs were used to determine fair value for the nine months ended September 30, 2019: Nine Months Ended September 30, (in thousands) 2019 Level 3 Investments (1) Balance at beginning of period $ 4,122 Purchases (sales), net (4,185) Change in realized and unrealized gain (loss), net 63 Balance at end of period $ — (1) The investments that are categorized as Level 3 were valued utilizing third-party pricing information without adjustment. The following table is a reconciliation of assets of CIP for Level 3 investments for which significant unobservable inputs were used to determine fair value: Nine Months Ended September 30, (in thousands) 2020 2019 Level 3 Investments of CIP (1) Balance at beginning of period $ 40,422 $ 6,848 Realized gains (losses), net 5 (95) Change in unrealized gains (losses), net (335) 310 Purchases 1,137 2,157 Amortization 9 (16) Sales (1,256) (5,414) Transfers to Level 2 (50,463) (42,232) Transfers from Level 2 25,643 51,544 Balance at end of period $ 15,162 $ 13,102 (1) The investments that are categorized as Level 3 were valued utilizing third-party pricing information without adjustment. Transfers between Level 2 and Level 3 were due to trading activities at period end. |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
Changes in Accumulated Other Comprehensive Income (Loss) | The changes in accumulated other comprehensive income (loss) by component for the nine months ended September 30, 2020 and 2019 were as follows: (in thousands) Unrealized Gains (Losses) on Foreign Balance at December 31, 2019 $ — $ 9 Foreign currency translation adjustments, net of tax of $3 — (9) Net current-period other comprehensive income (loss) — (9) Balance at September 30, 2020 $ — $ — (in thousands) Unrealized Gains (Losses) on Foreign Balance at December 31, 2018 $ (726) $ (5) Foreign currency translation adjustments, net of tax of $5 — (14) Amounts reclassified from accumulated other comprehensive income (loss), net of tax of $(254) 726 — Net current-period other comprehensive income (loss) 726 (14) Balance at September 30, 2019 $ — $ (19) |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Summary of Stock Based Compensation Expense | Stock based compensation expense is summarized as follows: Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 (in thousands) Stock-based compensation expense $ 6,299 $ 5,000 $ 16,412 $ 16,384 |
Summary of Restricted Stock Units Activity | RSU activity, inclusive of PSUs, for the nine months ended September 30, 2020 is summarized as follows: Number Weighted Average Outstanding at December 31, 2019 528,376 $ 115.74 Granted 211,660 $ 86.73 Forfeited (3,844) $ 118.95 Settled (181,091) $ 110.79 Outstanding at September 30, 2020 555,101 $ 106.27 |
Earnings (Loss) Per Share (Tabl
Earnings (Loss) Per Share (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Computation of Basic and Diluted Earnings per Share | The computation of basic and diluted EPS is as follows: Three Months Ended September 30, Nine Months Ended (in thousands, except per share amounts) 2020 2019 2020 2019 Net Income (Loss) $ 40,934 $ 25,359 $ 58,149 $ 75,726 Noncontrolling interests (11,286) (1,274) (21,507) (2,969) Net Income (Loss) Attributable to Stockholders 29,648 24,085 36,642 72,757 Preferred stock dividends — (2,085) — (6,253) Net Income (Loss) Attributable to Common Stockholders $ 29,648 $ 22,000 $ 36,642 $ 66,504 Shares: Basic: Weighted-average number of shares outstanding 7,684 6,947 7,611 6,990 Plus: Incremental shares from assumed conversion of dilutive instruments 313 1,210 347 1,225 Diluted: Weighted-average number of shares outstanding 7,997 8,157 7,958 8,215 Earnings (Loss) per Share—Basic $ 3.86 $ 3.17 $ 4.81 $ 9.51 Earnings (Loss) per Share—Diluted $ 3.71 $ 2.95 $ 4.60 $ 8.86 |
Securities Excluded from Computation of Diluted EPS | The following table details the securities that have been excluded from the above computation of weighted-average number of shares for diluted EPS, because the effect would be anti-dilutive: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2020 2019 2020 2019 Restricted stock units and options 1 32 — 29 Total anti-dilutive securities 1 32 — 29 |
Redeemable Noncontrolling Int_2
Redeemable Noncontrolling Interests (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Noncontrolling Interest [Abstract] | |
Redeemable Noncontrolling Interest | Redeemable noncontrolling interests for the nine months ended September 30, 2020 included the following amounts: (in thousands) CIP Affiliate Noncontrolling Interests Total Balances at December 31, 2019 $ 5,429 $ 58,416 $ 63,845 Net income (loss) attributable to noncontrolling interests (852) 3,474 2,622 Changes in redemption value (1) — 19,031 19,031 Total net income (loss) attributable to noncontrolling interests (852) 22,505 21,653 Net subscriptions (redemptions) and other 20,074 (6,295) 13,779 Balances at September 30, 2020 $ 24,651 $ 74,626 $ 99,277 (1) Relates to noncontrolling interests redeemable at other than fair value. |
Consolidation (Tables)
Consolidation (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Condensed Consolidated Balance Sheets | The following table presents the balances of CIP that, after intercompany eliminations, were reflected on the Condensed Consolidated Balance Sheets as of September 30, 2020 and December 31, 2019: As of September 30, 2020 December 31, 2019 VIEs VIEs (in thousands) VOEs CLOs Other VOEs CLOs Other Cash and cash equivalents $ 9,128 $ 43,930 $ 1,177 $ 2,665 $ 97,130 $ 363 Investments 46,623 2,231,691 55,371 22,223 1,976,148 31,739 Other assets 2,756 23,821 838 1,563 21,450 599 Notes payable — (2,190,937) — — (1,834,535) — Securities purchased payable and other liabilities (2,972) (37,378) (670) (2,964) (164,887) (200) Noncontrolling interests (22,362) (8,982) (2,289) (3,865) (10,558) (1,564) Net interests in CIP $ 33,173 $ 62,145 $ 54,427 $ 19,622 $ 84,748 $ 30,937 |
Schedule of Consolidated Collateralized Loan Obligations | Although these beneficial interests are eliminated upon consolidation, the application of the measurement alternative prescribed by ASU 2014-13, Consolidation (Topic 810) ("ASU 2014-13") results in the net assets of the consolidated CLOs shown above to be equivalent to the beneficial interests retained by the Company at September 30, 2020, as shown in the table below: (in thousands) Subordinated notes $ 60,721 Accrued investment management fees 1,424 Total beneficial interests $ 62,145 The following table represents income and expenses of the consolidated CLOs included on the Company’s Condensed Consolidated Statements of Operations for the period indicated: (in thousands) Nine Months Ended September 30, 2020 Income: Realized and unrealized gain (loss), net $ (9,648) Interest income 81,846 Total income 72,198 Expenses: Other operating expenses 9,535 Interest expense 70,258 Total expense 79,793 Noncontrolling interests 146 Net Income (loss) attributable to CIP $ (7,449) As summarized in the table below, the application of the measurement alternative as prescribed by ASU 2014-13 results in the consolidated net income summarized above to be equivalent to the Company’s own economic interests in the consolidated CLOs, which are eliminated upon consolidation: (in thousands) Nine Months Ended September 30, 2020 Distributions received and unrealized gains (losses) on the subordinated notes held by the Company $ (13,941) Investment management fees 6,492 Total economic interests $ (7,449) |
Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis | The Company’s assets and liabilities measured at fair value on a recurring basis, excluding the assets and liabilities of CIP discussed in Note 15, as of September 30, 2020 and December 31, 2019 by fair value hierarchy level were as follows: September 30, 2020 (in thousands) Level 1 Level 2 Level 3 Total Assets Cash equivalents $ 170,763 $ — $ — $ 170,763 Investment securities - fair value Sponsored funds 22,043 — — 22,043 Equity securities 9,594 — — 9,594 Debt securities — 4 — 4 Nonqualified retirement plan assets 9,302 — — 9,302 Total assets measured at fair value $ 211,702 $ 4 $ — $ 211,706 December 31, 2019 (in thousands) Level 1 Level 2 Level 3 Total Assets Cash equivalents $ 187,255 $ — $ — $ 187,255 Investment securities - fair value Sponsored funds 47,654 — — 47,654 Equity securities 13,320 — — 13,320 Debt securities — 16 — 16 Nonqualified retirement plan assets 8,724 — — 8,724 Total assets measured at fair value $ 256,953 $ 16 $ — $ 256,969 The assets and liabilities of CIP measured at fair value on a recurring basis as of September 30, 2020 and December 31, 2019 by fair value hierarchy level were as follows: As of September 30, 2020 (in thousands) Level 1 Level 2 Level 3 Total Assets Cash equivalents $ 43,930 $ — $ — $ 43,930 Debt investments 14,472 2,275,610 13,326 2,303,408 Equity investments 27,092 1,349 1,836 30,277 Derivatives 586 845 — 1,431 Total assets measured at fair value $ 86,080 $ 2,277,804 $ 15,162 $ 2,379,046 Liabilities Notes payable $ — $ 2,190,937 $ — $ 2,190,937 Derivatives 539 433 — 972 Short sales 472 — — 472 Total liabilities measured at fair value $ 1,011 $ 2,191,370 $ — $ 2,192,381 As of December 31, 2019 (in thousands) Level 1 Level 2 Level 3 Total Assets Cash equivalents $ 97,130 $ — $ — $ 97,130 Debt investments 218 1,973,427 39,389 2,013,034 Equity investments 15,872 171 1,033 17,076 Total assets measured at fair value $ 113,220 $ 1,973,598 $ 40,422 $ 2,127,240 Liabilities Notes payable $ — $ 1,834,535 $ — $ 1,834,535 Short sales 430 — — 430 Total liabilities measured at fair value $ 430 $ 1,834,535 $ — $ 1,834,965 |
Reconciliation of Assets of Consolidated Sponsored Investment Products For Level 3 Investments, Unobservable Inputs Used to Determine Fair Value | The following table is a reconciliation of assets for Level 3 investments for which significant unobservable inputs were used to determine fair value for the nine months ended September 30, 2019: Nine Months Ended September 30, (in thousands) 2019 Level 3 Investments (1) Balance at beginning of period $ 4,122 Purchases (sales), net (4,185) Change in realized and unrealized gain (loss), net 63 Balance at end of period $ — (1) The investments that are categorized as Level 3 were valued utilizing third-party pricing information without adjustment. The following table is a reconciliation of assets of CIP for Level 3 investments for which significant unobservable inputs were used to determine fair value: Nine Months Ended September 30, (in thousands) 2020 2019 Level 3 Investments of CIP (1) Balance at beginning of period $ 40,422 $ 6,848 Realized gains (losses), net 5 (95) Change in unrealized gains (losses), net (335) 310 Purchases 1,137 2,157 Amortization 9 (16) Sales (1,256) (5,414) Transfers to Level 2 (50,463) (42,232) Transfers from Level 2 25,643 51,544 Balance at end of period $ 15,162 $ 13,102 (1) The investments that are categorized as Level 3 were valued utilizing third-party pricing information without adjustment. Transfers between Level 2 and Level 3 were due to trading activities at period end. |
Revenues - Disaggregation of Re
Revenues - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 154,790 | $ 145,955 | $ 432,250 | $ 417,162 |
Investment management fees | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 129,785 | 120,023 | 360,623 | 340,532 |
Open-end funds | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 63,458 | 59,060 | 176,584 | 169,326 |
Closed-end funds | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 8,959 | 10,846 | 27,695 | 31,485 |
Retail separate accounts | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 26,412 | 22,092 | 74,524 | 60,761 |
Institutional accounts | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 29,048 | 25,180 | 76,571 | 71,013 |
Structured products | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 1,297 | 1,725 | 3,288 | 4,957 |
Other products | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 611 | 1,120 | 1,961 | 2,990 |
Distribution and service fees | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 9,797 | 10,442 | 28,146 | 31,122 |
Administration and shareholder service fees | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 15,114 | 15,280 | 43,056 | 44,747 |
Other income and fees | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 94 | $ 210 | $ 425 | $ 761 |
Intangible Assets, Net - Summar
Intangible Assets, Net - Summary of Intangible Assets, Net (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Dec. 31, 2018 |
Definite-lived intangible assets: | ||||
Investment contracts and other | $ 489,570 | $ 489,570 | ||
Accumulated amortization | (245,293) | (222,695) | ||
Definite-lived intangible assets, net | 244,277 | 266,875 | ||
Indefinite-lived intangible assets | 43,516 | 43,516 | ||
Total intangible assets, net | $ 287,793 | $ 310,391 | $ 317,924 | $ 338,812 |
Intangible Assets, Net - Schedu
Intangible Assets, Net - Schedule of Activity in Intangible Assets, Net (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Intangible assets, net | ||
Balance, beginning of period | $ 310,391 | $ 338,812 |
Additions | 0 | 1,823 |
Amortization | (22,598) | (22,711) |
Balance, end of period | $ 287,793 | $ 317,924 |
Intangible Assets, Net - Sche_2
Intangible Assets, Net - Schedule of Estimated Amortization Expense of Intangible Assets Succeeding Years (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Remainder of 2020 | $ 7,529 | |
2021 | 30,116 | |
2022 | 29,992 | |
2023 | 29,330 | |
2024 | 23,689 | |
2025 and thereafter | 123,621 | |
Definite-lived intangible assets, net | $ 244,277 | $ 266,875 |
Investments - Summary of Invest
Investments - Summary of Investments (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Schedule of Investments [Line Items] | ||
Investment securities - fair value | $ 31,641 | $ 60,990 |
Parent | ||
Schedule of Investments [Line Items] | ||
Investment securities - fair value | 31,641 | 60,990 |
Equity method investments | 12,039 | 12,030 |
Nonqualified retirement plan assets | 9,302 | 8,724 |
Other investments | 1,464 | 1,462 |
Total investments | $ 54,446 | $ 83,206 |
Investments - Schedule of Marke
Investments - Schedule of Marketable Securities (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Investment Securities - fair value | ||
Cost | $ 28,187 | $ 55,882 |
Fair Value | 31,641 | 60,990 |
Sponsored funds | ||
Investment Securities - fair value | ||
Cost | 21,075 | 44,588 |
Fair Value | 22,043 | 47,654 |
Equity securities | ||
Investment Securities - fair value | ||
Cost | 7,105 | 11,250 |
Fair Value | 9,594 | 13,320 |
Debt securities | ||
Investment Securities - fair value | ||
Cost | 7 | 44 |
Fair Value | $ 4 | $ 16 |
Investments - Additional Inform
Investments - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Schedule of Investments [Abstract] | ||||
Realized gain (loss) on marketable securities | $ 4.5 | $ 1 | $ 4.2 | $ 0.4 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Assets | ||
Cash equivalents | $ 170,763 | $ 187,255 |
Investment securities - fair value | ||
Fair Value | 31,641 | 60,990 |
Total assets measured at fair value | 211,706 | 256,969 |
Sponsored funds | ||
Investment securities - fair value | ||
Fair Value | 22,043 | 47,654 |
Equity securities | ||
Investment securities - fair value | ||
Fair Value | 9,594 | 13,320 |
Debt securities | ||
Investment securities - fair value | ||
Fair Value | 4 | 16 |
Nonqualified retirement plan assets | ||
Investment securities - fair value | ||
Nonqualified retirement plan assets | 9,302 | 8,724 |
Level 1 | ||
Assets | ||
Cash equivalents | 170,763 | 187,255 |
Investment securities - fair value | ||
Total assets measured at fair value | 211,702 | 256,953 |
Level 1 | Sponsored funds | ||
Investment securities - fair value | ||
Fair Value | 22,043 | 47,654 |
Level 1 | Equity securities | ||
Investment securities - fair value | ||
Fair Value | 9,594 | 13,320 |
Level 1 | Debt securities | ||
Investment securities - fair value | ||
Fair Value | 0 | 0 |
Level 1 | Nonqualified retirement plan assets | ||
Investment securities - fair value | ||
Nonqualified retirement plan assets | 9,302 | 8,724 |
Level 2 | ||
Assets | ||
Cash equivalents | 0 | 0 |
Investment securities - fair value | ||
Total assets measured at fair value | 4 | 16 |
Level 2 | Sponsored funds | ||
Investment securities - fair value | ||
Fair Value | 0 | 0 |
Level 2 | Equity securities | ||
Investment securities - fair value | ||
Fair Value | 0 | 0 |
Level 2 | Debt securities | ||
Investment securities - fair value | ||
Fair Value | 4 | 16 |
Level 2 | Nonqualified retirement plan assets | ||
Investment securities - fair value | ||
Nonqualified retirement plan assets | 0 | 0 |
Level 3 | ||
Assets | ||
Cash equivalents | 0 | 0 |
Investment securities - fair value | ||
Total assets measured at fair value | 0 | 0 |
Level 3 | Sponsored funds | ||
Investment securities - fair value | ||
Fair Value | 0 | 0 |
Level 3 | Equity securities | ||
Investment securities - fair value | ||
Fair Value | 0 | 0 |
Level 3 | Debt securities | ||
Investment securities - fair value | ||
Fair Value | 0 | 0 |
Level 3 | Nonqualified retirement plan assets | ||
Investment securities - fair value | ||
Nonqualified retirement plan assets | $ 0 | $ 0 |
Fair Value Measurements - Recon
Fair Value Measurements - Reconciliation of Level Three Investments (Details) - Level 3 - Investments - USD ($) | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Balance at beginning of period | $ 4,122,000 | |
Purchases (sales), net | (4,185,000) | |
Change in realized and unrealized gain (loss), net | 63,000 | |
Balance at end of period | $ 0 | $ 0 |
Equity Transactions - Additiona
Equity Transactions - Additional Information (Details) $ / shares in Units, $ in Thousands | Aug. 19, 2020$ / shares | Feb. 03, 2020day$ / sharesshares | Sep. 30, 2020USD ($)$ / sharesshares | Sep. 30, 2019USD ($)$ / shares | Sep. 30, 2020USD ($)$ / sharesshares | Sep. 30, 2019USD ($)$ / shares | May 31, 2020shares |
Equity, Class of Treasury Stock [Line Items] | |||||||
Preferred stock conversion, threshold consecutive trading days | day | 20 | ||||||
Cash dividends declared per common share (in $ per share) | $ / shares | $ 0.82 | $ 0.82 | $ 0.67 | $ 2.16 | $ 1.77 | ||
Number of additional shares authorized to be repurchased (in shares) | 750,000 | ||||||
Total number of shares authorized to be repurchased since inception (in shares) | 4,930,045 | ||||||
Repurchases of common shares (in shares) | 53,867 | 239,720 | |||||
Weighted average price (in $ per share) | $ / shares | $ 139.20 | $ 104.26 | |||||
Total cost of shares repurchased | $ | $ 7,500 | $ 7,501 | $ 25,000 | $ 30,000 | |||
Shares available for repurchase (in shares) | 762,718 | 762,718 | |||||
Convertible preferred stock | |||||||
Equity, Class of Treasury Stock [Line Items] | |||||||
Preferred stock, shares issuable upon conversion (in shares) | 1,150,000 | ||||||
Conversion ratio | 0.7938 | ||||||
Conversion price of stock (in $ per share) | $ / shares | $ 125.97 | ||||||
Common stock | |||||||
Equity, Class of Treasury Stock [Line Items] | |||||||
Shares issued during period, conversion of convertible preferred stock (in shares) | 912,870 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (Loss) - Changes in Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning Balance | $ 666,511 | $ 663,672 | $ 686,257 | $ 643,867 |
Reclassification from other comprehensive (income) loss | 726 | |||
Other comprehensive income (loss) | 17 | (12) | (9) | (14) |
Ending Balance | 688,012 | 677,616 | 688,012 | 677,616 |
Unrealized Gains (Losses) on Securities Available-for-Sale | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning Balance | 0 | (726) | ||
Foreign currency translation adjustments, net of tax of $9 & $1 respectively | 0 | 0 | ||
Reclassification from other comprehensive (income) loss | 726 | |||
Other comprehensive income (loss) | 0 | 726 | ||
Ending Balance | 0 | 0 | 0 | 0 |
Reclassification from AOCI, tax | (254) | |||
Foreign Currency Translation Adjustments | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning Balance | 9 | (5) | ||
Foreign currency translation adjustments, net of tax of $9 & $1 respectively | (9) | (14) | ||
Reclassification from other comprehensive (income) loss | 0 | |||
Other comprehensive income (loss) | (9) | (14) | ||
Ending Balance | $ 0 | $ (19) | 0 | (19) |
Other comprehensive income (loss), before reclassifications, tax | $ 3 | $ 5 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares of common stock available for issuance (in shares) | 336,276 | |
Shares of common stock reserved for issuance (in shares) | 2,820,000 | |
RSUs and PSUs | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Unamortized stock-based compensation expense | $ 27.2 | |
Weighted-average remaining amortization period | 1 year 4 months 24 days | |
Restricted Stock Units (RSUs) | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share settlement under RSUs (in shares) | 63,566 | 58,487 |
Cash used for employee withholding tax payments | $ 5.6 | $ 5.9 |
Performance Share Units (PSUs) | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Awards granted (in shares) | 68,371 | |
Period for recognition of compensation expense | 3 years | |
Minimum | Restricted Stock Units (RSUs) | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Term | 1 year | |
Maximum | Restricted Stock Units (RSUs) | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Term | 3 years |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock Based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | ||||
Stock-based compensation expense | $ 6,299 | $ 5,000 | $ 16,412 | $ 16,384 |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Restricted Stock Units Activity (Details) - Restricted Stock Units | 9 Months Ended |
Sep. 30, 2020$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |
Number of shares, Beginning Balance (in shares) | shares | 528,376 |
Number of shares, Granted (in shares) | shares | 211,660 |
Number of shares, Forfeited (in shares) | shares | (3,844) |
Number of shares, Settled (in shares) | shares | (181,091) |
Number of shares, Ending Balance (in shares) | shares | 555,101 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |
Weighted Average Grant Date Fair Value, Beginning Balance (in $ per share) | $ / shares | $ 115.74 |
Weighted Average Grant Date Fair Value, Granted (in $ per share) | $ / shares | 86.73 |
Weighted Average Grant Date Fair Value, Forfeited (in $ per share) | $ / shares | 118.95 |
Weighted Average Grant Date Fair Value, Settled (in $ per share) | $ / shares | 110.79 |
Weighted Average Grant Date Fair Value, Ending Balance (in $ per share) | $ / shares | $ 106.27 |
Earnings (Loss) Per Share - Sch
Earnings (Loss) Per Share - Schedule of Computation of Basic and Diluted Earnings per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Earnings Per Share [Abstract] | ||||
Net Income (Loss) | $ 40,934 | $ 25,359 | $ 58,149 | $ 75,726 |
Noncontrolling interests | (11,286) | (1,274) | (21,507) | (2,969) |
Net Income (Loss) Attributable to Stockholders | 29,648 | 24,085 | 36,642 | 72,757 |
Preferred stockholder dividends | 0 | (2,085) | 0 | (6,253) |
Net Income (Loss) Attributable to Common Stockholders | $ 29,648 | $ 22,000 | $ 36,642 | $ 66,504 |
Shares: | ||||
Basic: Weighted-average number of common shares outstanding (in shares) | 7,684 | 6,947 | 7,611 | 6,990 |
Plus: Incremental shares from assumed conversion of dilutive instruments (in shares) | 313 | 1,210 | 347 | 1,225 |
Diluted: Weighted-average number of common shares outstanding (in shares) | 7,997 | 8,157 | 7,958 | 8,215 |
Earnings (Loss) per share—Basic (in $ per share) | $ 3.86 | $ 3.17 | $ 4.81 | $ 9.51 |
Earnings (Loss) per Share—Diluted (in $ per share) | $ 3.71 | $ 2.95 | $ 4.60 | $ 8.86 |
Earnings (Loss) Per Share - Sec
Earnings (Loss) Per Share - Securities Excluded from Computation of Diluted EPS (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total anti-dilutive securities (in shares) | 1 | 32 | 0 | 29 |
Restricted stock units and options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total anti-dilutive securities (in shares) | 1 | 32 | 0 | 29 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Income Tax Disclosure [Abstract] | ||
Estimated effective income tax rate | 33.90% | 24.00% |
Debt (Details)
Debt (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2020 | Dec. 31, 2019 | |
Line of Credit Facility [Line Items] | ||
Amount outstanding | $ 218,014,000 | $ 277,839,000 |
Credit Agreement | Term loan | ||
Line of Credit Facility [Line Items] | ||
Borrowing capacity | $ 365,000,000 | |
Term of debt | 7 years | |
Principal loan payments | $ 62,500,000 | |
Debt retired | 10,000,000 | |
Amount paid for debt | 8,900,000 | |
Amount outstanding | 223,200,000 | |
Debt issuance costs | (5,200,000) | |
Credit Agreement | Revolving credit facility | ||
Line of Credit Facility [Line Items] | ||
Borrowing capacity | $ 100,000,000 | |
Term of debt | 5 years | |
Amount outstanding | $ 0 |
Redeemable Noncontrolling Int_3
Redeemable Noncontrolling Interests - Narrative (Details) | 9 Months Ended |
Sep. 30, 2020 | |
Minimum | |
Noncontrolling Interest [Line Items] | |
Exercise period | 4 years |
Maximum | |
Noncontrolling Interest [Line Items] | |
Exercise period | 7 years |
Redeemable Noncontrolling Int_4
Redeemable Noncontrolling Interests - Schedule of Redeemable Noncontrolling Interest (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Increase (Decrease) in Redeemable Non-controlling Interests [Roll Forward] | ||||
Beginning balance | $ 63,845 | |||
Net income (loss) attributable to noncontrolling interests | 2,622 | |||
Changes in redemption value | 17,137 | $ 22,046 | ||
Total net income (loss) attributable to noncontrolling interests | $ 10,309 | $ 1,342 | 21,653 | 3,266 |
Net subscriptions (redemptions) and other | (1,719) | $ 29,766 | 13,779 | $ 30,863 |
Ending balance | 99,277 | 99,277 | ||
CIP | ||||
Increase (Decrease) in Redeemable Non-controlling Interests [Roll Forward] | ||||
Beginning balance | 5,429 | |||
Net income (loss) attributable to noncontrolling interests | (852) | |||
Total net income (loss) attributable to noncontrolling interests | (852) | |||
Net subscriptions (redemptions) and other | 20,074 | |||
Ending balance | 24,651 | 24,651 | ||
Affiliate Noncontrolling Interests | ||||
Increase (Decrease) in Redeemable Non-controlling Interests [Roll Forward] | ||||
Beginning balance | 58,416 | |||
Net income (loss) attributable to noncontrolling interests | 3,474 | |||
Total net income (loss) attributable to noncontrolling interests | 22,505 | |||
Net subscriptions (redemptions) and other | (6,295) | |||
Ending balance | $ 74,626 | 74,626 | ||
Portion at Other than Fair Value Measurement | ||||
Increase (Decrease) in Redeemable Non-controlling Interests [Roll Forward] | ||||
Changes in redemption value | 19,031 | |||
Portion at Other than Fair Value Measurement | CIP | ||||
Increase (Decrease) in Redeemable Non-controlling Interests [Roll Forward] | ||||
Changes in redemption value | 0 | |||
Portion at Other than Fair Value Measurement | Affiliate Noncontrolling Interests | ||||
Increase (Decrease) in Redeemable Non-controlling Interests [Roll Forward] | ||||
Changes in redemption value | $ 19,031 |
Consolidation - Condensed Conso
Consolidation - Condensed Consolidated Balance Sheets (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Jun. 30, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2018 |
Variable Interest Entity [Line Items] | ||||||
Noncontrolling interests | $ (99,277) | $ (90,687) | $ (63,845) | $ (91,610) | $ (60,502) | $ (57,481) |
VOEs | ||||||
Variable Interest Entity [Line Items] | ||||||
Cash and cash equivalents | 9,128 | 2,665 | ||||
Investments | 46,623 | 22,223 | ||||
Other assets | 2,756 | 1,563 | ||||
Notes payable | 0 | 0 | ||||
Securities purchased payable and other liabilities | (2,972) | (2,964) | ||||
Noncontrolling interests | (22,362) | (3,865) | ||||
Net interests in CIP | 33,173 | 19,622 | ||||
CLOs | ||||||
Variable Interest Entity [Line Items] | ||||||
Cash and cash equivalents | 43,930 | 97,130 | ||||
Investments | 2,231,691 | 1,976,148 | ||||
Other assets | 23,821 | 21,450 | ||||
Notes payable | (2,190,937) | (1,834,535) | ||||
Securities purchased payable and other liabilities | (37,378) | (164,887) | ||||
Noncontrolling interests | (8,982) | (10,558) | ||||
Net interests in CIP | 62,145 | 84,748 | ||||
Other | ||||||
Variable Interest Entity [Line Items] | ||||||
Cash and cash equivalents | 1,177 | 363 | ||||
Investments | 55,371 | 31,739 | ||||
Other assets | 838 | 599 | ||||
Notes payable | 0 | 0 | ||||
Securities purchased payable and other liabilities | (670) | (200) | ||||
Noncontrolling interests | (2,289) | (1,564) | ||||
Net interests in CIP | $ 54,427 | $ 30,937 |
Consolidation - Additional Info
Consolidation - Additional Information (Details) | 9 Months Ended | |
Sep. 30, 2020USD ($)collateralized_loan_obligation | Dec. 31, 2019USD ($) | |
CLOs | ||
Variable Interest Entity [Line Items] | ||
Number of CLOs consolidated | collateralized_loan_obligation | 6 | |
Investments | $ 2,231,691,000 | $ 1,976,148,000 |
Nonconsolidated | ||
Variable Interest Entity [Line Items] | ||
Carrying value and maximum risk of loss | $ 26,200,000 | |
LIBOR | CLOs | ||
Variable Interest Entity [Line Items] | ||
Investments, basis spread on variable interest rate | 12.00% | |
Senior Notes | CLOs | ||
Variable Interest Entity [Line Items] | ||
Unpaid principal balance exceeds fair value | $ 135,800,000 | |
Subordinated Notes - Newfleet CLO 2016-1 | CLOs | ||
Variable Interest Entity [Line Items] | ||
Debt par value | 2,500,000,000 | |
Subordinated Notes - Newfleet CLO 2016-1 | Subordinated Debt | CLOs | ||
Variable Interest Entity [Line Items] | ||
Debt par value | 225,900,000 | |
Senior Secured Floating Rate Notes - Newfleet CLO 2016-1 | Senior Notes | CLOs | ||
Variable Interest Entity [Line Items] | ||
Debt par value | $ 2,200,000,000 | |
Minimum | Senior Secured Floating Rate Notes - Newfleet CLO 2016-1 | LIBOR | CLOs | ||
Variable Interest Entity [Line Items] | ||
Basis spread on variable rate | 0.80% | |
Maximum | Senior Secured Floating Rate Notes - Newfleet CLO 2016-1 | LIBOR | CLOs | ||
Variable Interest Entity [Line Items] | ||
Basis spread on variable rate | 8.70% |
Consolidation - Beneficial Inte
Consolidation - Beneficial Interests of Consolidated Investment Product (Details) - CLOs $ in Thousands | Sep. 30, 2020USD ($) |
Variable Interest Entity [Line Items] | |
Subordinated notes | $ 60,721 |
Accrued investment management fees | 1,424 |
Total beneficial interests | $ 62,145 |
Consolidation - Revenue and Exp
Consolidation - Revenue and Expenses of Consolidated Investment Product (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Expenses: | ||||
Other operating expenses | $ 16,343 | $ 18,228 | $ 52,664 | $ 56,125 |
Noncontrolling interests | (11,286) | (1,274) | (21,507) | (2,969) |
Net Income (Loss) Attributable to Common Stockholders | $ 29,648 | $ 22,000 | 36,642 | $ 66,504 |
CLOs | ||||
Income: | ||||
Realized and unrealized gain (loss), net | (9,648) | |||
Interest income | 81,846 | |||
Total revenues | 72,198 | |||
Expenses: | ||||
Other operating expenses | 9,535 | |||
Interest expense | 70,258 | |||
Total expense | 79,793 | |||
Noncontrolling interests | 146 | |||
Net Income (Loss) Attributable to Common Stockholders | $ (7,449) |
Consolidation - Economic Intere
Consolidation - Economic Interests of Consolidated Investment Product (Details) - CLOs $ in Thousands | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Variable Interest Entity [Line Items] | |
Distributions received and unrealized gains (losses) on the subordinated notes held by the Company | $ (13,941) |
Investment management fees | 6,492 |
Total Economic Interests | $ (7,449) |
Consolidation - Summary of Asse
Consolidation - Summary of Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Assets | ||
Cash equivalents | $ 170,763 | $ 187,255 |
Total assets measured at fair value | 211,706 | 256,969 |
Level 1 | ||
Assets | ||
Cash equivalents | 170,763 | 187,255 |
Total assets measured at fair value | 211,702 | 256,953 |
Level 2 | ||
Assets | ||
Cash equivalents | 0 | 0 |
Total assets measured at fair value | 4 | 16 |
Level 3 | ||
Assets | ||
Cash equivalents | 0 | 0 |
Total assets measured at fair value | 0 | 0 |
Fair Value, Measurements, Recurring | Consolidated Investment Products | ||
Assets | ||
Cash equivalents | 43,930 | 97,130 |
Derivatives | 1,431 | |
Total assets measured at fair value | 2,379,046 | 2,127,240 |
Liabilities | ||
Notes payable | 2,190,937 | 1,834,535 |
Derivatives | 972 | |
Short sales | 472 | 430 |
Total liabilities measured at fair value | 2,192,381 | 1,834,965 |
Fair Value, Measurements, Recurring | Debt investments | Consolidated Investment Products | ||
Assets | ||
Investments | 2,303,408 | 2,013,034 |
Fair Value, Measurements, Recurring | Equity investments | Consolidated Investment Products | ||
Assets | ||
Investments | 30,277 | 17,076 |
Fair Value, Measurements, Recurring | Level 1 | Consolidated Investment Products | ||
Assets | ||
Cash equivalents | 43,930 | 97,130 |
Derivatives | 586 | |
Total assets measured at fair value | 86,080 | 113,220 |
Liabilities | ||
Notes payable | 0 | 0 |
Derivatives | 539 | |
Short sales | 472 | 430 |
Total liabilities measured at fair value | 1,011 | 430 |
Fair Value, Measurements, Recurring | Level 1 | Debt investments | Consolidated Investment Products | ||
Assets | ||
Investments | 14,472 | 218 |
Fair Value, Measurements, Recurring | Level 1 | Equity investments | Consolidated Investment Products | ||
Assets | ||
Investments | 27,092 | 15,872 |
Fair Value, Measurements, Recurring | Level 2 | Consolidated Investment Products | ||
Assets | ||
Cash equivalents | 0 | 0 |
Derivatives | 845 | |
Total assets measured at fair value | 2,277,804 | 1,973,598 |
Liabilities | ||
Notes payable | 2,190,937 | 1,834,535 |
Derivatives | 433 | |
Short sales | 0 | 0 |
Total liabilities measured at fair value | 2,191,370 | 1,834,535 |
Fair Value, Measurements, Recurring | Level 2 | Debt investments | Consolidated Investment Products | ||
Assets | ||
Investments | 2,275,610 | 1,973,427 |
Fair Value, Measurements, Recurring | Level 2 | Equity investments | Consolidated Investment Products | ||
Assets | ||
Investments | 1,349 | 171 |
Fair Value, Measurements, Recurring | Level 3 | Consolidated Investment Products | ||
Assets | ||
Cash equivalents | 0 | 0 |
Derivatives | 0 | |
Total assets measured at fair value | 15,162 | 40,422 |
Liabilities | ||
Notes payable | 0 | 0 |
Derivatives | 0 | |
Short sales | 0 | 0 |
Total liabilities measured at fair value | 0 | 0 |
Fair Value, Measurements, Recurring | Level 3 | Debt investments | Consolidated Investment Products | ||
Assets | ||
Investments | 13,326 | 39,389 |
Fair Value, Measurements, Recurring | Level 3 | Equity investments | Consolidated Investment Products | ||
Assets | ||
Investments | $ 1,836 | $ 1,033 |
Consolidation - Assets Related
Consolidation - Assets Related to Consolidated Sponsored Investment Products, Unobservable Input Reconciliation (Details) - Debt investments - Consolidated Investment Products - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Balance at beginning of period | $ 40,422 | $ 6,848 |
Realized gains (losses), net | 5 | (95) |
Change in unrealized gains (losses), net | (335) | 310 |
Purchases | 1,137 | 2,157 |
Amortization | 9 | (16) |
Sales | (1,256) | (5,414) |
Transfers to Level 2 | (50,463) | (42,232) |
Transfers from Level 2 | 25,643 | 51,544 |
Balance at end of period | $ 15,162 | $ 13,102 |