Silvercrest's Q1 2025 Earnings Call: Navigating Contradictions in Global Strategy and Financial Management

Expansion into international markets and global inflows, operating leverage and expense management, stock buybacks and their prioritization, global equity strategy and inflows, OCIO asset growth and performance are the key contradictions discussed in Silvercrest Asset Management's latest 2025Q1 earnings call.



Strong Client Flows and Asset Growth:
- Silvercrest experienced strong new client organic flows of $0.4 billion during Q1 2025, adding to the significant new client flows of $1.4 billion in Q4 2024, totaling $1.8 billion over the past two quarters.
- The growth in client accounts was driven by strategic investments, a robust business development pipeline, and successful execution of new business strategies.

Market Volatility Impact on AUM:
- Silvercrest's total AUM declined during Q1 due to volatile markets, with discretionary AUM standing at $22.7 billion, flat year-over-year.
- The decline was primarily a result of market volatility amidst global economic and trade concerns, impacting investor confidence and asset allocation decisions.

OCIO and Global Value Strategy Expansion:
- Silvercrest is actively expanding its consultant relationships and international presence, focusing on the global value strategy and OCIO services.
- The expansion is aimed at tapping into large investment opportunities and potential follow-on flows, particularly in Europe and Southeast Asia.

Shareholder Returns and Strategic Investments:
- Silvercrest completed a $12 million stock repurchase program and declared a quarterly dividend of $0.20 per share.
- These actions are supported by the company's strong balance sheet and strategic investments in talent and business growth initiatives, aiming to maximize shareholder value.

Cost Management and Compensation Adjustments:
- Expenses increased year-over-year by $2.2 million or 9%, driven by increased compensation and benefits, and general and administrative expenses.
- Silvercrest is adjusting its interim compensation ratio to align with strategic investments, aiming to build a return on invested capital in high-growth areas.