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Westwood Holdings Group, Inc. (WHG)

NYSE - Nasdaq Real Time Price. Currency in USD
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13.09+0.40 (+3.15%)
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Neutralpattern detected
Previous Close12.69
Open12.74
Bid12.99 x 800
Ask13.04 x 800
Day's Range12.74 - 13.09
52 Week Range10.50 - 31.92
Volume9,730
Avg. Volume47,771
Market Cap110.547M
Beta (5Y Monthly)1.35
PE Ratio (TTM)49.96
EPS (TTM)0.26
Earnings DateOct 28, 2020 - Nov 02, 2020
Forward Dividend & YieldN/A (N/A)
Ex-Dividend DateMar 05, 2020
1y Target EstN/A
  • Westwood Holdings Group Inc (WHG) Q2 2020 Earnings Call Transcript
    Motley Fool

    Westwood Holdings Group Inc (WHG) Q2 2020 Earnings Call Transcript

    The following discussion will include forward-looking statements, which are subject to known and unknown risks, uncertainties and other factors which may cause actual results to be materially different from those contemplated by the forward-looking statements. You are cautioned not to place undue reliance on forward-looking statements.

  • GlobeNewswire

    Westwood Holdings Group, Inc. Reports Second Quarter 2020 Results

    Westwood SmallCap Fund Introduces Y Share Class Westwood SmidCap Fund Introduces Ultra Share Class Trading outsourced to improve client experience and internal operational efficiencyDALLAS, July 29, 2020 (GLOBE NEWSWIRE) -- Westwood Holdings Group, Inc. (NYSE: WHG) today reported second quarter 2020 earnings. Highlights from the quarter include: * Income Opportunity, Enhanced Balanced, SmallCap Value, Alternative Income, Global Convertible, LargeCap Select and Total Return strategies beat their primary benchmarks for the quarter. * Income Opportunity, Enhanced Balanced, Alternative Income, Global Convertible, MLP Opportunities and Total Return strategies achieved top quartile institutional rankings. * Revenues of $15.9 million compared with $16.7 million in the first quarter of 2020 and $21.7 million a year ago. * Net loss of $2.6 million compared with net income of $1.1 million in the first quarter of 2020 and $1.9 million a year ago. Non-GAAP Economic Earnings of $0.2 million, compared with $4.2 million in the first quarter of 2020 and $4.8 million a year ago. * Repurchased 407,697 shares of our common stock for an aggregate purchase price of $8.1 million. * At quarter-end, Westwood had $74.2 million in cash and short-term investments, stockholders' equity of $131.4 million and no debt.Revenues were lower than the first quarter of 2020 and last year's second quarter principally as a result of lower average assets under management ("AUM").AUM at June 30, 2020 totaled $11.9 billion versus $11.6 billion at March 31, 2020. The increase was due to market appreciation across the majority of our strategies, partially offset by net outflows in our Emerging Market and Global Convertible strategies.The second quarter net loss of $2.6 million was lower than the first quarter's net income of $1.1 million primarily due to lower revenues, foreign currency transaction losses and higher income taxes partially offset by lower operating expenses. Diluted earnings (loss) per share ("EPS") for the second quarter was $(0.33) compared to $0.13 for the first quarter. Non-GAAP Economic Earnings for the second quarter were $0.2 million, or $0.03 per share, a decrease from $4.2 million, or $0.50 per share, in the first quarter.The second quarter net loss of $2.6 million was lower than second quarter of 2019 net income of $1.9 million primarily due to lower revenues, partially offset by lower operating expenses, particularly employee compensation and benefits. Diluted EPS for the second quarter was $(0.33) compared to $0.22 for the second quarter of 2019. Non-GAAP Economic Earnings for the second quarter were $0.2 million, or $0.03 per share, down from $4.8 million, or $0.56 per share for the second quarter of 2019.Brian Casey, Westwood’s President and CEO, commented, "As the Covid-19 pandemic casts its long shadow over our social and business lives, I want to thank all of our Westwood employees, mostly working from home, for serving our clients so well. I am very pleased to report that several of our portfolio strategies beat their benchmarks for the quarter and also performed well against their peers. Many challenges confront us in the current environment and accordingly, with the full support of our board, we have crafted a strategic plan to restructure certain business areas to reduce operating expenses while continuing to invest in our long-term growth initiatives. As part of this plan, our Westwood International Advisors office in Toronto will cease operations towards the end of the third quarter. Reviews of other business units and products not deemed commercially viable in the long run are likely to lead to additional actions that will be covered in the third quarter call. We believe this plan will enable us to better manage our business in this environment as well as pursue an array of future profitable growth initiatives."Economic Earnings and Economic EPS are non-GAAP performance measures and are explained and reconciled with the most comparable GAAP numbers in the attached tables.Westwood will host a conference call to discuss second quarter 2020 results and other business matters at 4:30 p.m. Eastern time today.  To join the conference call, dial 877-303-6235 (U.S. and Canada) or 631-291-4837 (international).  The conference call can also be accessed via our Investor Relations page at westwoodgroup.com and will be available for replay through August 6, 2020 by dialing 855-859-2056 (U.S. and Canada) or 404-537-3406 (international) and entering the passcode 4963578.About Westwood Holdings GroupWestwood Holdings Group, Inc. is a focused investment management boutique and wealth management firm.Westwood offers high-conviction equity and outcome-oriented solutions to institutional investors, private wealth clients and financial intermediaries. The firm specializes in three distinct investment capabilities: U.S. Value Equity, Multi-Asset and Emerging Markets Equity. To meet the full range of investors’ financial needs, access to these strategies is available through separate accounts, the Westwood Funds® family of mutual funds and other pooled vehicles. Westwood benefits from significant, broad-based employee ownership and trades on the New York Stock Exchange under the symbol “WHG.” Based in Dallas, Westwood also maintains offices in Boston, Houston and Toronto.  For more information on Westwood, please visit westwoodgroup.com.Forward-looking StatementsStatements in this press release that are not purely historical facts, including, without limitation, statements about our expected future financial position, results of operations or cash flows, as well as other statements including without limitation, words such as “anticipate,” “believe,” “expect,” “could,” and other similar expressions, constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Actual results and the timing of some events could differ materially from those projected in or contemplated by the forward-looking statements due to a number of factors, including, without limitation:the composition and market value of our AUM; our ability to maintain our fee structure in light of competitive fee pressures; the impact of the recent COVID-19 pandemic; the significant concentration of our revenues in a small number of customers; our ability to avoid termination of client agreements and the related investment redemptions; regulations adversely affecting the financial services industry; competition in the investment management industry; our ability to develop and market new investment strategies successfully; our AUM include investments in foreign companies; our reputation and our relationships with current and potential customers; our ability to attract and retain qualified personnel; our ability to maintain effective cyber security; our ability to perform operational tasks; our ability to identify and execute on our strategic initiatives; our ability to maintain effective information systems; our ability to select and oversee third-party vendors; litigation risks; our ability to declare and pay dividends; our ability to fund future capital requirements on favorable terms; our ability to properly address conflicts of interest; our ability to maintain adequate insurance coverage; our ability to maintain an effective system of internal controls; our stock is thinly traded and may be subject to volatility; our organizational documents contain provisions that may prevent or deter another group from paying a premium over the market price to our stockholders to acquire our stock; we are a holding company dependent on the operations and funds of our subsidiaries; our relationships with investment consulting firms; and the other risks detailed from time to time in Westwood’s SEC filings, including, but not limited to, its annual report on Form 10-K for the year ended December 31, 2019 and its quarterly report on Form 10-Q for the quarters ended March 31, 2020 and June 30, 2020. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Except as required by law, Westwood is not obligated to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this press release or to reflect the occurrence of unanticipated events.SOURCE:  Westwood Holdings Group, Inc.(WHG-G) CONTACT: Westwood Holdings Group, Inc. Terry Forbes Chief Financial Officer and Treasurer (214) 756-6900 WESTWOOD HOLDINGS GROUP, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (in thousands, except per share and share amounts) (unaudited) Three Months Ended  June 30, 2020 March 31, 2020 June 30, 2019 REVENUES:      Advisory fees:      Asset-based$9,328   $11,102   $14,695  Performance-based695   —   120  Trust fees5,657   5,951   6,444  Trust performance-based fees40   —   —  Other, net155   (384)  450  Total revenues15,875   16,669   21,709         EXPENSES:      Employee compensation and benefits10,787   12,668   11,378  Sales and marketing253   478   514  Westwood mutual funds434   515   661  Information technology2,030   2,031   2,282  Professional services991   1,193   1,169  General and administrative2,191   2,306   2,402  (Gain) loss on foreign currency transactions1,323   (2,938)  724  Total expenses18,009   16,253   19,130  Net operating income (loss)(2,134)  416   2,579  Unrealized gains (losses) on private investments159   (995)  —  Investment income124   544   —  Other income34   34   77  Income (loss) before income taxes(1,817)  (1)  2,656  Income tax expense (benefit)758   (1,103)  795  Net income (loss)$(2,575)  $1,102   $1,861  Other comprehensive income (loss):      Foreign currency translation adjustments1,371   (3,242)  735  Total comprehensive income (loss)$(1,204)  $(2,140)  $2,596         Earnings (loss) per share:      Basic$(0.33)  $0.13   $0.22  Diluted$(0.33)  $0.13   $0.22         Weighted average shares outstanding:      Basic7,879,698   8,414,393   8,446,610  Diluted7,879,698   8,458,473   8,476,777         Economic Earnings$224   $4,200   $4,773  Economic EPS$0.03   $0.50   $0.56         Dividends declared per share$0.00   $0.43   $0.72  WESTWOOD HOLDINGS GROUP, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (in thousands, except per share and share amounts) (unaudited) Six Months Ended  June 30, 2020 June 30, 2019 REVENUES:    Advisory fees:    Asset-based$20,430   $31,101  Performance-based695   300  Trust fees11,608   12,983  Trust performance-based fees40   —  Other, net(229)  1,187  Total revenues32,544   45,571       EXPENSES:    Employee compensation and benefits23,455   25,988  Sales and marketing731   1,044  Westwood mutual funds949   1,507  Information technology4,061   4,259  Professional services2,184   2,318  General and administrative4,497   4,836  (Gain) loss on foreign currency transactions(1,615)  1,544  Total expenses34,262   41,496  Net operating income (loss)(1,718)  4,075  Unrealized gains (losses) on private investments(836)  —  Investment income668   —  Other income68   77  Income (loss) before income taxes(1,818)  4,152  Income tax expense (benefit)(345)  1,899  Net income (loss)$(1,473)  $2,253  Other comprehensive income (loss):      Foreign currency translation adjustments(1,871)  1,566  Total comprehensive income (loss)$(3,344)  $3,819       Earnings (loss) per share:    Basic$(0.18)  $0.27  Diluted$(0.18)  $0.27       Weighted average shares outstanding:    Basic8,147,045   8,406,367  Diluted8,147,045   8,467,589       Economic Earnings$4,424   $8,889  Economic EPS$0.54   $1.05       Dividends declared per share$0.43   $1.44  WESTWOOD HOLDINGS GROUP, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, except par value and share amounts) (unaudited) June 30, 2020 December 31, 2019 ASSETS    Current Assets:    Cash and cash equivalents$43,926   $49,766   Accounts receivable10,751   13,177   Investments, at fair value30,228   50,324   Prepaid income taxes709   1,150   Other current assets1,764   2,544   Total current assets87,378   116,961   Investments8,154   8,154   Noncurrent investments at fair value3,401   4,238   Goodwill19,804   19,804   Deferred income taxes3,139   2,216   Operating lease right-of-use assets6,981   7,562   Intangible assets, net14,398   15,256   Property and equipment, net of accumulated depreciation of $7,827 and $7,3953,741   4,152   Other long-term assets425   364   Total assets$147,421   $178,707   LIABILITIES AND STOCKHOLDERS’ EQUITY    Current Liabilities:    Accounts payable and accrued liabilities$1,781   $2,145   Dividends payable1,127   7,362   Compensation and benefits payable3,912   9,975   Operating lease liabilities1,666   1,584   Income taxes payable192   289   Total current liabilities8,678   21,355   Accrued dividends371   1,303   Noncurrent operating lease liabilities6,943   7,762   Total long-term liabilities7,314   9,065   Total liabilities15,992   30,420        Stockholders’ Equity:    Common stock, $0.01 par value, authorized 25,000,000 shares, issued 10,558,111 and outstanding 8,382,342 shares at June 30, 2020; issued 10,306,570 and outstanding 8,881,086 shares at December 31, 2019106   103   Additional paid-in capital208,572   203,441   Treasury stock, at cost - 2,175,758 shares at June 30, 2020; 1,425,483 shares at December 31, 2019(78,050)  (63,281)  Accumulated other comprehensive loss(4,814)  (2,943)  Retained earnings5,615   10,967   Total stockholders’ equity131,429   148,287   Total liabilities and stockholders’ equity$147,421   $178,707   WESTWOOD HOLDINGS GROUP, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) (unaudited) Six Months Ended June 30,  2020 2019 CASH FLOWS FROM OPERATING ACTIVITIES:    Net income (loss)$(1,473)  $2,253   Adjustments to reconcile net income (loss) to net cash provided by operating activities:    Depreciation465   425   Amortization of intangible assets858   836   Unrealized (gains) losses on investments904   (600)  Stock-based compensation expense4,921   5,683   Deferred income taxes(939)  763   Non-cash lease expense615   561   Changes in operating assets and liabilities:    Net sales of investments – trading securities20,029   18,779   Accounts receivable2,350   4,891   Other current assets709   (589)  Accounts payable and accrued liabilities(361)  (604)  Compensation and benefits payable(5,790)  (10,357)  Income taxes payable307   (288)  Other liabilities(771)  (692)  Net cash provided by operating activities21,824   21,061   CASH FLOWS FROM INVESTING ACTIVITIES:    Purchases of property and equipment(56)  (402)  Purchases of investments—   (250)  Net cash used in investing activities(56)  (652)  CASH FLOWS FROM FINANCING ACTIVITIES:    Purchases of treasury stock(12,952)  (806)  Purchases of treasury stock for employee stock plans(697)  (981)  Restricted stock returned for payment of taxes(1,120)  (2,385)  Cash dividends(11,043)  (13,860)  Net cash used in financing activities(25,812)  (18,032)  Effect of currency rate changes on cash(1,796)  1,484   NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS(5,840)  3,861   Cash and cash equivalents, beginning of period49,766   52,449   Cash and cash equivalents, end of period$43,926   $56,310        Supplemental cash flow information:    Cash paid during the period for income taxes$288   $1,417   Accrued dividends$1,498   $8,150   Accrued purchases of property and equipment$—   $203   WESTWOOD HOLDINGS GROUP, INC. AND SUBSIDIARIES Reconciliation of Net Income (Loss) to Economic Earnings (in thousands, except per share and share amounts) (unaudited) Three Months Ended  June 30, 2020 March 31, 2020 June 30, 2019 Net income (loss)$(2,575)  $1,102   $1,861  Add:  Stock-based compensation expense2,305   2,616   2,430  Add:  Intangible amortization435   423   423  Add:  Tax benefit from goodwill amortization59   59   59  Economic Earnings$224   $4,200   $4,773         Diluted weighted average shares7,879,698   8,458,473   8,476,777  Economic EPS$0.03   $0.50   $0.56            Six Months Ended    June 30, 2020 June 30, 2019 Net income (loss)  $(1,473)  $2,253  Add:  Stock-based compensation expense  4,921   5,682  Add:  Intangible amortization  858   836  Add:  Tax benefit from goodwill amortization  118   118  Economic Earnings  $4,424   $8,889         Diluted weighted average shares  8,147,045   8,467,589  Economic EPS  $0.54   $1.05  As supplemental information, we are providing non-GAAP performance measures that we refer to as Economic Earnings and Economic EPS. We provide these measures in addition to, not as a substitute for, net income (loss) and earnings (loss) per share, which are reported on a GAAP basis. Our management and Board of Directors review Economic Earnings and Economic EPS to evaluate our ongoing performance, allocate resources, and review our dividend policy. We believe that these non-GAAP performance measures, while not substitutes for GAAP net income (loss) or earnings (loss) per share, are useful for management and investors when evaluating our underlying operating and financial performance and our available resources. We do not advocate that investors consider these non-GAAP measures without also considering financial information prepared in accordance with GAAP.We define Economic Earnings as net income (loss) plus non-cash equity-based compensation expense, amortization of intangible assets, and deferred taxes related to goodwill. Although depreciation on fixed assets is a non-cash expense, we do not add it back when calculating Economic Earnings because depreciation charges represent an allocation of the decline in the value of the related assets that will ultimately require replacement. In addition, we do not adjust Economic Earnings for tax deductions related to restricted stock expense or amortization of intangible assets. Economic EPS represents Economic Earnings divided by diluted weighted average shares outstanding.

  • GlobeNewswire

    Westwood Holdings Group, Inc. to Host Second Quarter 2020 Conference Call/Webcast

    DALLAS, July 16, 2020 -- Westwood Holdings Group, Inc. (NYSE:WHG) will release its second quarter 2020 earnings after the close of the New York Stock Exchange on Wednesday,.