GCM Grosvenor (GCMG) Q3 2024 earnings summary

Executive summary

• Fee-related earnings increased 18% year-to-date, with adjusted net income up 24% and GAAP net income up 16% over the same period in 2023.

• Assets under management reached approximately $80 billion, up 5% year-over-year, with fee-paying AUM at $63.7 billion.

• Fundraising momentum remains strong, with $1.4 billion raised in Q3 and $4.8 billion year-to-date, a 34% increase year-over-year.

• Growth is driven by private markets, direct-oriented strategies, infrastructure, and sustainable investments, with significant pipeline expansion and new product launches.

• Board declared a $0.11 per share dividend for Q4 2024, payable December 16, 2024.

Financial highlights

• Q3 2024 GAAP revenue was $122.9 million, up 1% year-over-year; YTD revenue $348.8 million, up 6%.

• Fee-related earnings margin was 41% for the quarter, up from 37% prior year.

• Adjusted EBITDA grew 21% year-to-date to $136.2 million; Q3 2024 Adjusted EBITDA was $48.4 million, up 11% year-over-year.

• Private markets management fees grew 6% in Q3 and 8% year-to-date; ARS management fees increased 2% in Q3 and 1% year-to-date.

• Realized $23 million in incentive fees in Q3, including $20 million in carried interest.

Outlook and guidance

• Expect fundraising in the second half of 2024 to exceed the $3.4 billion raised in the first half.

• Anticipate full-year private markets management fee growth of 9%-11% over the prior year.

• Maintain confidence in the five-year target to double 2023 fee-related earnings by 2028.

• Adjusted EBITDA and adjusted net income are expected to grow faster than fee-related earnings over the next four years.

• Management expects cash flow from operations, current cash, and available borrowing capacity to be sufficient to fund operations, capital expenditures, and debt service for the next twelve months and foreseeable future.