Diluted loss per share of ($0.20); Earnings per share of $0.04, as adjusted
Net flows of $5.3 billion in the quarter (highest flowing quarter since 2015)
Nine consecutive quarters of net inflows
NEW YORK--(BUSINESS WIRE)--WisdomTree, Inc. (NYSE: WT), a global financial innovator, today reported financial results for the fourth quarter of 2022.
($28.3) million net loss ($7.0(1) million net income, as adjusted); see “Non-GAAP Financial Measurements” for additional information.
$35.4 million non-cash loss associated with the revaluation of deferred consideration-gold payments due to a decrease in the discount rate used to compute the present value of the annual payment obligations, as well as higher gold prices.
$82.0 billion of ending AUM, an increase of 15.7% arising from market appreciation and net inflows.
$5.3 billion of net inflows, primarily driven by inflows into our fixed income, U.S. equity and commodity products.
0.36% average advisory fee, a decrease of 2 basis points due to AUM mix shift.
$73.3 million of operating revenues, essentially unchanged from the previous quarter as higher average AUM was offset by a decline in our average advisory fee.
76.9% gross margin(1), a 0.6 point decrease from the previous quarter due to fund rebalances and recent fund launches.
16.0% operating income margin, a 4.5 point decrease compared to our operating margin of 20.5% in the prior quarter primarily due to higher expenses related to the finalization of year-end compensation and seasonal marketing and sales-related initiatives.
$0.03 quarterly dividend declared, payable on March 1, 2023 to stockholders of record as of the close of business on February 15, 2023.
Update from Jonathan Steinberg, WisdomTree CEO
“The momentum we built from last year has set the table for a very exciting 2023 for WisdomTree. We expect our solid fund performance and positioning, combined with growth in our managed models franchise, will drive another year of strong organic growth. Additionally, we remain excited and focused on launching WisdomTree PrimeTM and anticipate the platform will be available in app stores in Q2, enabling many users across the U.S. to build holistic portfolios from our suite of digital funds and real-world asset tokens and merge saving, spending and investing activities. Overall, WisdomTree remains on track with exceptional momentum, the right strategy and a tremendous opportunity ahead in ETFs, models, advisors solutions, digital assets and blockchain-enabled finance.” |
Update from Jarrett Lilien, WisdomTree COO and President
“Driven by over $12 billion of net inflows in 2022, WisdomTree exited the year with record assets under management. Our 16% pace of organic flow growth in 2022 was not only the best among our public asset manager peers, but it was the best year for flows since 2015. That momentum has continued into 2023 with over $1.5 billion of net inflows, putting WisdomTree in a position to achieve its tenth consecutive quarter of firm-wide net inflows. With products and solutions that are not only strong performers, but positioned very well against this market backdrop, we see ample opportunity in front of us and could not be more excited about what is to come in 2023.” |
OPERATING AND FINANCIAL HIGHLIGHTS
|
Three Months Ended |
|||||||||||||||||||
|
Dec. 31, 2022 |
Sept. 30, 2022 |
June 30, 2022 |
Mar. 31, 2022 |
Dec. 31, 2021 |
|||||||||||||||
Consolidated Operating Highlights ($ in billions): |
|
|
|
|
|
|||||||||||||||
AUM—end of period |
$ |
82.0 |
|
$ |
70.9 |
|
$ |
74.3 |
|
$ |
79.4 |
|
$ |
77.5 |
|
|||||
Net inflows |
$ |
5.3 |
|
$ |
1.7 |
|
$ |
3.9 |
|
$ |
1.3 |
|
$ |
1.9 |
|
|||||
Average AUM |
$ |
77.7 |
|
$ |
74.7 |
|
$ |
77.7 |
|
$ |
77.8 |
|
$ |
76.0 |
|
|||||
Average advisory fee |
|
0.36 |
% |
|
0.38 |
% |
|
0.39 |
% |
|
0.40 |
% |
|
0.40 |
% |
|||||
|
|
|
|
|
||||||||||||||||
|
|
|
|
|
|
|||||||||||||||
Consolidated Financial Highlights ($ in millions, except per share amounts): |
|
|
|
|
|
|||||||||||||||
Operating revenues |
$ |
73.3 |
|
$ |
72.4 |
|
$ |
77.3 |
|
$ |
78.4 |
|
$ |
79.2 |
|
|||||
Net (loss)/income |
$ |
(28.3 |
) |
$ |
81.2 |
|
$ |
8.0 |
|
$ |
(10.3 |
) |
$ |
11.2 |
|
|||||
Diluted (loss)/earnings per share |
$ |
(0.20 |
) |
$ |
0.50 |
|
$ |
0.05 |
|
$ |
(0.08 |
) |
$ |
0.07 |
|
|||||
Operating income margin |
|
16.0 |
% |
|
20.5 |
% |
|
20.5 |
% |
|
22.6 |
% |
|
28.5 |
% |
|||||
As Adjusted (Non-GAAP(1)): |
|
|
|
|
|
|||||||||||||||
Gross margin |
|
76.9 |
% |
|
77.5 |
% |
|
79.2 |
% |
|
80.2 |
% |
|
80.5 |
% |
|||||
Net income, as adjusted |
$ |
7.0 |
|
$ |
9.3 |
|
$ |
11.3 |
|
$ |
14.1 |
|
$ |
15.7 |
|
|||||
Diluted earnings per share, as adjusted |
$ |
0.04 |
|
$ |
0.06 |
|
$ |
0.07 |
|
$ |
0.09 |
|
$ |
0.10 |
|
|||||
Operating income margin, as adjusted |
|
16.0 |
% |
|
20.5 |
% |
|
23.1 |
% |
|
25.7 |
% |
|
28.5 |
% |
|||||
|
|
|
|
|
|
|||||||||||||||
RECENT BUSINESS DEVELOPMENTS
Company News
Product News
|
WISDOMTREE, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share amounts) (Unaudited) |
||||||||||||||||||||||||||||
|
Three Months Ended |
Years Ended |
||||||||||||||||||||||||||
|
Dec. 31, 2022 |
Sept. 30, 2022 |
June 30, 2022 |
Mar. 31, 2022 |
Dec. 31, 2021 |
Dec. 31, 2022 |
Dec. 31, 2021 |
|||||||||||||||||||||
Operating Revenues: |
|
|
|
|
|
|
|
|||||||||||||||||||||
Advisory fees |
$ |
70,913 |
|
$ |
70,616 |
|
$ |
75,586 |
|
$ |
76,517 |
|
$ |
77,441 |
|
$ |
293,632 |
|
$ |
298,052 |
|
|||||||
Other income |
|
2,397 |
|
|
1,798 |
|
|
1,667 |
|
|
1,851 |
|
|
1,734 |
|
|
7,713 |
|
|
6,266 |
|
|||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total revenues |
|
73,310 |
|
|
72,414 |
|
|
77,253 |
|
|
78,368 |
|
|
79,175 |
|
|
301,345 |
|
|
304,318 |
|
|||||||
Operating Expenses: |
|
|
|
|
|
|
|
|||||||||||||||||||||
Compensation and benefits |
|
24,831 |
|
|
23,714 |
|
|
24,565 |
|
|
24,787 |
|
|
23,178 |
|
|
97,897 |
|
|
88,163 |
|
|||||||
Fund management and administration |
|
16,906 |
|
|
16,285 |
|
|
16,076 |
|
|
15,494 |
|
|
15,417 |
|
|
64,761 |
|
|
58,912 |
|
|||||||
Marketing and advertising |
|
4,240 |
|
|
3,145 |
|
|
3,894 |
|
|
4,023 |
|
|
4,565 |
|
|
15,302 |
|
|
14,090 |
|
|||||||
Sales and business development |
|
3,407 |
|
|
2,724 |
|
|
3,131 |
|
|
2,609 |
|
|
2,668 |
|
|
11,871 |
|
|
9,907 |
|
|||||||
Contractual gold payments |
|
4,107 |
|
|
4,105 |
|
|
4,446 |
|
|
4,450 |
|
|
4,262 |
|
|
17,108 |
|
|
17,096 |
|
|||||||
Professional fees |
|
2,666 |
|
|
2,367 |
|
|
4,308 |
|
|
4,459 |
|
|
2,099 |
|
|
13,800 |
|
|
7,616 |
|
|||||||
Occupancy, communications and equipment |
|
1,110 |
|
|
986 |
|
|
1,049 |
|
|
753 |
|
|
725 |
|
|
3,898 |
|
|
4,629 |
|
|||||||
Depreciation and amortization |
|
104 |
|
|
58 |
|
|
53 |
|
|
47 |
|
|
45 |
|
|
262 |
|
|
738 |
|
|||||||
Third-party distribution fees |
|
1,793 |
|
|
1,833 |
|
|
1,818 |
|
|
2,212 |
|
|
1,830 |
|
|
7,656 |
|
|
7,176 |
|
|||||||
Other |
|
2,427 |
|
|
2,324 |
|
|
2,109 |
|
|
1,845 |
|
|
1,823 |
|
|
8,705 |
|
|
6,933 |
|
|||||||
|
|
|||||||||||||||||||||||||||
Total operating expenses |
|
61,591 |
|
|
57,541 |
|
|
61,449 |
|
|
60,679 |
|
|
56,612 |
|
|
241,260 |
|
|
215,260 |
|
|||||||
Operating income |
|
11,719 |
|
|
14,873 |
|
|
15,804 |
|
|
17,689 |
|
|
22,563 |
|
|
60,085 |
|
|
89,058 |
|
|||||||
Other Income/(Expenses): |
|
|
|
|
|
|
|
|||||||||||||||||||||
Interest expense |
|
(3,736 |
) |
|
(3,734 |
) |
|
(3,733 |
) |
|
(3,732 |
) |
|
(3,740 |
) |
|
(14,935 |
) |
|
(12,332 |
) |
|||||||
(Loss)/gain on revaluation of deferred consideration—gold payments |
|
(35,423 |
) |
|
77,895 |
|
|
2,311 |
|
|
(17,018 |
) |
|
(3,048 |
) |
|
27,765 |
|
|
2,018 |
|
|||||||
Interest income |
|
945 |
|
|
811 |
|
|
770 |
|
|
794 |
|
|
864 |
|
|
3,320 |
|
|
2,009 |
|
|||||||
Impairments |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(16,156 |
) |
|||||||
Other losses, net |
|
(1,815 |
) |
|
(5,289 |
) |
|
(4,474 |
) |
|
(24,707 |
) |
|
(1,368 |
) |
|
(36,285 |
) |
|
(7,926 |
) |
|||||||
|
|
|
||||||||||||||||||||||||||
(Loss)/income before income taxes |
|
(28,310 |
) |
|
84,556 |
|
|
10,678 |
|
|
(26,974 |
) |
|
15,271 |
|
|
39,950 |
|
|
56,671 |
|
|||||||
Income tax (benefit)/expense |
|
(21 |
) |
|
3,327 |
|
|
2,673 |
|
|
(16,713 |
) |
|
4,084 |
|
|
(10,734 |
) |
|
6,874 |
|
|||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Net (loss)/income |
$ |
(28,289 |
) |
$ |
81,229 |
|
$ |
8,005 |
|
$ |
(10,261 |
) |
$ |
11,187 |
|
$ |
50,684 |
|
$ |
49,797 |
|
|||||||
(Loss)/earnings per share—basic |
$ |
(0.20 |
) |
$ |
0.50 |
(2) |
$ |
0.05 |
(2) |
$ |
(0.08 |
)(2) |
$ |
0.07 |
(2) |
$ |
0.31 |
(2) |
$ |
0.31 |
(2) |
|||||||
(Loss)/earnings per share—diluted |
$ |
(0.20 |
) |
$ |
0.50 |
(2) |
$ |
0.05 |
|
$ |
(0.08 |
)(2) |
$ |
0.07 |
|
$ |
0.31 |
(2) |
$ |
0.31 |
|
|||||||
Weighted average common shares—basic |
|
143,126 |
|
|
143,120 |
|
|
143,046 |
|
|
142,782 |
|
|
142,070 |
|
|
143,020 |
|
|
143,847 |
|
|||||||
Weighted average common shares—diluted |
|
143,126 |
|
|
158,953 |
|
|
158,976 |
|
|
142,782 |
|
|
159,826 |
|
|
158,914 |
|
|
161,263 |
|
|||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||
As Adjusted (Non-GAAP(1)) |
|
|
|
|
|
|
|
|||||||||||||||||||||
Total operating expenses |
$ |
61,591 |
|
$ |
57,541 |
|
$ |
59,425 |
|
$ |
58,244 |
|
$ |
56,612 |
|
|
|
|||||||||||
Operating income |
$ |
11,719 |
|
$ |
14,873 |
|
$ |
17,828 |
|
$ |
20,124 |
|
$ |
22,563 |
|
|
|
|||||||||||
Income before income taxes |
$ |
8,615 |
|
$ |
12,645 |
|
$ |
14,498 |
|
$ |
17,674 |
|
$ |
19,968 |
|
|
|
|||||||||||
Income tax expense |
$ |
1,588 |
|
$ |
3,323 |
|
$ |
3,241 |
|
$ |
3,611 |
|
$ |
4,232 |
|
|
|
|||||||||||
Net income |
$ |
7,027 |
|
$ |
9,322 |
|
$ |
11,257 |
|
$ |
14,063 |
|
$ |
15,736 |
|
|
|
|||||||||||
Earnings per share—diluted |
$ |
0.04 |
|
$ |
0.06 |
|
$ |
0.07 |
|
$ |
0.09 |
|
$ |
0.10 |
|
|
|
|||||||||||
QUARTERLY HIGHLIGHTS
Operating Revenues
- Operating revenues were essentially unchanged from the third quarter of 2022 and decreased 7.4% from the fourth quarter of 2021 as higher average AUM was offset by a decline in our average advisory fee.
- Our average advisory fee was 0.36%, 0.38% and 0.40% during the fourth quarter of 2022, the third quarter of 2022 and the fourth quarter of 2021, respectively.
Operating Expenses
- Operating expenses increased 7.0% from the third quarter of 2022 primarily due to higher incentive compensation, marketing expenses, sales and business development expenses and fund management and administration costs.
- Operating expenses increased 8.8% from the fourth quarter of 2021 primarily due to higher incentive compensation and headcount, fund management and administration costs, sales and business development expenses, professional fees incurred in connection with our digital assets initiative and other expenses. These increases were partly offset by lower marketing expenses.
Other Income/(Expenses)
- Interest expense was essentially unchanged from the third quarter of 2022 and the fourth quarter of 2021.
- We recognized a non-cash loss on revaluation of deferred consideration of $35.4 million during the fourth quarter of 2022. The loss arose primarily from a decrease in the discount rate used to compute the present value of the annual payment obligations, as well as higher gold prices. The magnitude of any gain or loss recognized is highly correlated to changes in the discount rate and the magnitude of the change in the forward-looking price of gold.
- Interest income was essentially unchanged from the third quarter of 2022 and fourth quarter of 2021.
- Other net losses were $1.8 million for the fourth quarter of 2022 and included losses on our financial instruments owned and investments of $1.5 million. Gains and losses also generally arise from the sale of gold earned from management fees paid by our physically-backed gold exchange-traded products (“ETPs”), foreign exchange fluctuations and other miscellaneous items.
Income Taxes
- Our income tax provision for the fourth quarter of 2022 was a benefit of $0.02 million. The effective tax rate differs from the federal statutory rate of 21% due to a non-deductible loss on revaluation of deferred consideration, partly offset by a reduction in the valuation allowance on foreign net operating losses.
- Our adjusted effective income tax rate was 18.4%(1).
ANNUAL HIGHLIGHTS
- Operating revenues were essentially unchanged from 2021.
- Operating expenses increased 12.1% as compared to 2021 primarily due to higher incentive compensation and headcount, professional fees including $4.5 million incurred in response to an activist campaign and professional fees associated with our digital assets initiative, fund management and administration costs, sales and business development expenses, marketing expenses, third-party distribution fees and other expenses. These increases were partly offset by lower occupancy expenses and depreciation and amortization expenses.
- Significant items reported in other income/(expense) in 2022 include: an increase in interest expense of 21.1% due to a higher level of debt outstanding; a non-cash gain on revaluation of deferred consideration of $27.8 million; an increase in interest income of 65.3% due to an increase in our financial instruments owned; a non-cash charge of $19.9 million upon the release of tax-related indemnification assets arising from a favorable resolution of certain tax audits as well as the expiration of the statute of limitations (an equal and offsetting benefit was recognized in income tax expense); and losses on our financial instruments owned and investments of $16.9 million. Gains and losses also generally arise from the sale of gold earned on management fees paid by our physically-backed gold ETPs, foreign exchange fluctuations and other miscellaneous items.
- Our effective income tax rate for 2022 was negative 26.9%, resulting in an income tax benefit of $10.7 million. Our tax rate differs from the federal statutory rate of 21% primarily due to the reduction in unrecognized tax benefits associated with the release of the tax-related indemnification asset described above, a reduction in the valuation allowance on foreign net operating losses, a non-taxable gain on revaluation of deferred consideration and a lower tax rate on foreign earnings. These items were partly offset by an increase in the deferred tax asset valuation allowance on losses recognized on financial instruments owned.
CONFERENCE CALL DIAL-IN AND WEBCAST DETAILS
WisdomTree will discuss its results and operational highlights during a live webcast on Friday, February 3, 2023 at 11:00 a.m. ET, which can be accessed using the following link: https://event.choruscall.com/mediaframe/webcast.html?webcastid=mwe6KVat. Participants also can dial in using the following numbers: (877) 407-9210 or (201) 689-8049. Click here to access the participant international toll-free access numbers. To avoid delays, we encourage participants to log in or dial into the conference call 10 minutes ahead of the scheduled start time. All earnings materials and the webcast can be accessed through WisdomTree’s investor relations website at https://ir.wisdomtree.com. A replay of the webcast will also be available shortly after the call.
ABOUT WISDOMTREE
WisdomTree is a global financial innovator, offering a well-diversified suite of exchange-traded products (ETPs), models and solutions. We empower investors to shape their future and support financial professionals to better serve their clients and grow their businesses. WisdomTree is leveraging the latest financial infrastructure to create products that provide access, transparency and an enhanced user experience. Building on our heritage of innovation, we are also developing next-generation digital products and structures, including digital funds and tokenized assets, as well as our blockchain-native digital wallet, WisdomTree Prime™.
WisdomTree currently has approximately $87.1 billion in assets under management globally.
For more information about WisdomTree and WisdomTree PrimeTM, visit: https://www.wisdomtree.com.
Please visit us on Twitter at @WisdomTreeNews.
WisdomTree® is the marketing name for WisdomTree, Inc. and its subsidiaries worldwide.
| ____________________ | ||
| (1) | See “Non-GAAP Financial Measurements.” |
|
| (2) | Earnings/(loss) per share (“EPS”) is calculated pursuant to the two-class method as it results in a lower EPS amount as compared to the treasury stock method. |
|
WisdomTree, Inc. |
||||||||||||||||||||
Key Operating Statistics (Unaudited) |
|
|
||||||||||||||||||
|
Three Months Ended |
|||||||||||||||||||
|
Dec. 31, 2022 |
Sept. 30, 2022 |
June 30, 2022 |
Mar. 31, 2022 |
Dec. 31, 2021 |
|||||||||||||||
GLOBAL ETPs ($ in millions) |
|
|
|
|
|
|||||||||||||||
|
|
|
|
|||||||||||||||||
Beginning of period assets |
$ |
70,878 |
|
$ |
74,302 |
|
$ |
79,407 |
|
$ |
77,479 |
|
$ |
72,783 |
|
|||||
Inflows/(outflows) |
|
5,264 |
|
|
1,747 |
|
|
3,852 |
|
|
1,319 |
|
|
1,902 |
|
|||||
Market appreciation/(depreciation) |
|
5,844 |
|
|
(5,171 |
) |
|
(8,953 |
) |
|
609 |
|
|
2,809 |
|
|||||
Fund closures |
|
— |
|
|
— |
|
|
(4 |
) |
|
— |
|
|
(15 |
) |
|||||
|
|
|
|
|
|
|||||||||||||||
End of period assets |
$ |
81,986 |
|
$ |
70,878 |
|
$ |
74,302 |
|
$ |
79,407 |
|
$ |
77,479 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
Average assets during the period |
$ |
77,654 |
|
$ |
74,687 |
|
$ |
77,744 |
|
$ |
77,811 |
|
$ |
75,990 |
|
|||||
Average advisory fee during the period |
|
0.36 |
% |
|
0.38 |
% |
|
0.39 |
% |
|
0.40 |
% |
|
0.40 |
% |
|||||
Revenue days |
|
92 |
|
|
92 |
|
|
91 |
|
|
90 |
|
|
92 |
|
|||||
Number of ETFs—end of the period |
|
348 |
|
|
347 |
|
|
344 |
|
|
341 |
|
|
329 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
U.S. LISTED ETFs ($ in millions) |
|
|
|
|
|
|||||||||||||||
|
|
|
|
|
||||||||||||||||
Beginning of period assets |
$ |
48,043 |
|
$ |
47,255 |
|
$ |
48,622 |
|
$ |
48,210 |
|
$ |
44,742 |
|
|||||
Inflows/(outflows) |
|
4,232 |
|
|
3,812 |
|
|
4,278 |
|
|
2,250 |
|
|
1,865 |
|
|||||
Market appreciation/(depreciation) |
|
3,700 |
|
|
(3,024 |
) |
|
(5,645 |
) |
|
(1,838 |
) |
|
1,618 |
|
|||||
Fund closures |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(15 |
) |
|||||
|
|
|
|
|
|
|||||||||||||||
End of period assets |
$ |
55,975 |
|
$ |
48,043 |
|
$ |
47,255 |
|
$ |
48,622 |
|
$ |
48,210 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
Average assets during the period |
$ |
53,659 |
|
$ |
49,473 |
|
$ |
48,275 |
|
$ |
47,502 |
|
$ |
46,942 |
|
|||||
Number of ETFs—end of the period |
|
79 |
|
|
78 |
|
|
77 |
|
|
77 |
|
|
75 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
EUROPEAN LISTED ETPs ($ in millions) |
|
|
|
|
||||||||||||||||
|
|
|
|
|||||||||||||||||
Beginning of period assets |
$ |
22,835 |
|
$ |
27,047 |
|
$ |
30,785 |
|
$ |
29,269 |
|
$ |
28,041 |
|
|||||
Inflows/(outflows) |
|
1,032 |
|
|
(2,065 |
) |
|
(426 |
) |
|
(931 |
) |
|
37 |
|
|||||
Market appreciation/(depreciation) |
|
2,144 |
|
|
(2,147 |
) |
|
(3,308 |
) |
|
2,447 |
|
|
1,191 |
|
|||||
Fund closures |
|
— |
|
|
— |
|
|
(4 |
) |
|
— |
|
|
— |
|
|||||
|
|
|
|
|
|
|||||||||||||||
End of period assets |
$ |
26,011 |
|
$ |
22,835 |
|
$ |
27,047 |
|
$ |
30,785 |
|
$ |
29,269 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
Average assets during the period |
$ |
23,995 |
|
$ |
25,214 |
|
$ |
29,469 |
|
$ |
30,309 |
|
$ |
29,048 |
|
|||||
Number of ETPs—end of the period |
|
269 |
|
|
269 |
|
|
267 |
|
|
264 |
|
|
254 |
|
|||||
|
|
|
|
|
||||||||||||||||
PRODUCT CATEGORIES ($ in millions) |
|
|
|
|
|
|||||||||||||||
|
|
|
|
|
|
|||||||||||||||
U.S. Equity |
|
|
|
|
|
|||||||||||||||
Beginning of period assets |
$ |
20,952 |
|
$ |
21,058 |
|
$ |
23,738 |
|
$ |
23,860 |
|
$ |
21,383 |
|
|||||
Inflows/(outflows) |
|
1,022 |
|
|
1,239 |
|
|
306 |
|
|
779 |
|
|
783 |
|
|||||
Market appreciation/(depreciation) |
|
2,140 |
|
|
(1,345 |
) |
|
(2,986 |
) |
|
(901 |
) |
|
1,694 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
End of period assets |
$ |
24,114 |
|
$ |
20,952 |
|
$ |
21,058 |
|
$ |
23,738 |
|
$ |
23,860 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
Average assets during the period |
$ |
23,496 |
|
$ |
22,541 |
|
$ |
22,368 |
|
$ |
23,138 |
|
$ |
22,962 |
|
|||||
|
|
|
|
|
||||||||||||||||
Commodity & Currency |
|
|
|
|
|
|||||||||||||||
Beginning of period assets |
$ |
19,561 |
|
$ |
23,624 |
|
$ |
26,302 |
|
$ |
24,598 |
|
$ |
23,825 |
|
|||||
Inflows/(outflows) |
|
796 |
|
|
(2,179 |
) |
|
(475 |
) |
|
(1,053 |
) |
|
(251 |
) |
|||||
Market appreciation/(depreciation) |
|
1,731 |
|
|
(1,884 |
) |
|
(2,203 |
) |
|
2,757 |
|
|
1,024 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
End of period assets |
$ |
22,088 |
|
$ |
19,561 |
|
$ |
23,624 |
|
$ |
26,302 |
|
$ |
24,598 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
Average assets during the period |
$ |
20,346 |
|
$ |
21,628 |
|
$ |
25,767 |
|
$ |
25,889 |
|
$ |
24,421 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
Fixed Income |
|
|
|
|
|
|||||||||||||||
Beginning of period assets |
$ |
11,695 |
|
$ |
9,192 |
|
$ |
5,418 |
|
$ |
4,356 |
|
$ |
3,530 |
|
|||||
Inflows/(outflows) |
|
3,392 |
|
|
2,627 |
|
|
4,038 |
|
|
1,242 |
|
|
838 |
|
|||||
Market appreciation/(depreciation) |
|
186 |
|
|
(124 |
) |
|
(264 |
) |
|
(180 |
) |
|
(12 |
) |
|||||
|
|
|
|
|
|
|||||||||||||||
End of period assets |
$ |
15,273 |
|
$ |
11,695 |
|
$ |
9,192 |
|
$ |
5,418 |
|
$ |
4,356 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
Average assets during the period |
$ |
13,962 |
|
$ |
10,077 |
|
$ |
7,426 |
|
$ |
4,691 |
|
$ |
4,119 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
|
Three Months Ended |
|||||||||||||||||||
|
Dec. 31, 2022 |
Sept. 30, 2022 |
June 30, 2022 |
Mar. 31, 2022 |
Dec. 31, 2021 |
|||||||||||||||
|
|
|
|
|
|
|||||||||||||||
International Developed Market Equity |
|
|
|
|
|
|||||||||||||||
Beginning of period assets |
$ |
9,183 |
|
$ |
9,968 |
|
$ |
11,422 |
|
$ |
11,894 |
|
$ |
11,181 |
|
|||||
Inflows/(outflows) |
|
40 |
|
|
(115 |
) |
|
79 |
|
|
97 |
|
|
440 |
|
|||||
Market appreciation/(depreciation) |
|
972 |
|
|
(670 |
) |
|
(1,533 |
) |
|
(569 |
) |
|
273 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
End of period assets |
$ |
10,195 |
|
$ |
9,183 |
|
$ |
9,968 |
|
$ |
11,422 |
|
$ |
11,894 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
Average assets during the period |
$ |
10,000 |
|
$ |
10,032 |
|
$ |
10,695 |
|
$ |
11,543 |
|
$ |
11,524 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
Emerging Market Equity |
|
|
|
|
|
|||||||||||||||
Beginning of period assets |
$ |
7,495 |
|
$ |
8,386 |
|
$ |
9,991 |
|
$ |
10,375 |
|
$ |
10,666 |
|
|||||
(Outflows)/inflows |
|
(53 |
) |
|
114 |
|
|
(223 |
) |
|
189 |
|
|
(3 |
) |
|||||
Market appreciation/(depreciation) |
|
674 |
|
|
(1,005 |
) |
|
(1,382 |
) |
|
(573 |
) |
|
(288 |
) |
|||||
|
|
|
|
|
|
|||||||||||||||
End of period assets |
$ |
8,116 |
|
$ |
7,495 |
|
$ |
8,386 |
|
$ |
9,991 |
|
$ |
10,375 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
Average assets during the period |
$ |
7,770 |
|
$ |
8,329 |
|
$ |
9,155 |
|
$ |
10,116 |
|
$ |
10,550 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
Leveraged & Inverse |
|
|
|
|
|
|||||||||||||||
Beginning of period assets |
$ |
1,523 |
|
$ |
1,618 |
|
$ |
1,856 |
|
$ |
1,775 |
|
$ |
1,663 |
|
|||||
Inflows/(outflows) |
|
59 |
|
|
45 |
|
|
90 |
|
|
(2 |
) |
|
10 |
|
|||||
Market appreciation/(depreciation) |
|
172 |
|
|
(140 |
) |
|
(328 |
) |
|
83 |
|
|
102 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
End of period assets |
$ |
1,754 |
|
$ |
1,523 |
|
$ |
1,618 |
|
$ |
1,856 |
|
$ |
1,775 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
Average assets during the period |
$ |
1,623 |
|
$ |
1,589 |
|
$ |
1,765 |
|
$ |
1,830 |
|
$ |
1,761 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
Alternatives |
|
|
|
|
|
|||||||||||||||
Beginning of period assets |
$ |
306 |
|
$ |
305 |
|
$ |
293 |
|
$ |
261 |
|
$ |
222 |
|
|||||
Inflows/(outflows) |
|
12 |
|
|
16 |
|
|
34 |
|
|
29 |
|
|
56 |
|
|||||
Market (depreciation)/appreciation |
|
(8 |
) |
|
(15 |
) |
|
(22 |
) |
|
3 |
|
|
(17 |
) |
|||||
|
|
|
|
|
|
|||||||||||||||
End of period assets |
$ |
310 |
|
$ |
306 |
|
$ |
305 |
|
$ |
293 |
|
$ |
261 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
Average assets during the period |
$ |
305 |
|
$ |
313 |
|
$ |
299 |
|
$ |
275 |
|
$ |
229 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
Cryptocurrency |
|
|
|
|
|
|||||||||||||||
Beginning of period assets |
$ |
163 |
|
$ |
151 |
|
$ |
383 |
|
$ |
357 |
|
$ |
295 |
|
|||||
(Outflows)/inflows |
|
(4 |
) |
|
— |
|
|
3 |
|
|
37 |
|
|
28 |
|
|||||
Market (depreciation)/appreciation |
|
(23 |
) |
|
12 |
|
|
(235 |
) |
|
(11 |
) |
|
34 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
End of period assets |
$ |
136 |
|
$ |
163 |
|
$ |
151 |
|
$ |
383 |
|
$ |
357 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
Average assets during the period |
$ |
152 |
|
$ |
178 |
|
$ |
265 |
|
$ |
324 |
|
$ |
406 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
Closed ETPs |
|
|
|
|
|
|||||||||||||||
Beginning of period assets |
$ |
— |
|
$ |
— |
|
$ |
4 |
|
$ |
3 |
|
$ |
18 |
|
|||||
Inflows/(outflows) |
|
— |
|
|
— |
|
|
— |
|
|
1 |
|
|
1 |
|
|||||
Market depreciation |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(1 |
) |
|||||
Fund closures |
|
— |
|
|
— |
|
|
(4 |
) |
|
— |
|
|
(15 |
) |
|||||
|
|
|
|
|
|
|||||||||||||||
End of period assets |
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
4 |
|
$ |
3 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
Average assets during the period |
$ |
— |
|
$ |
— |
|
$ |
4 |
|
$ |
5 |
|
$ |
18 |
|
|||||
|
|
|
|
|
|
|||||||||||||||
Headcount |
|
273 |
|
|
274 |
|
|
264 |
|
|
253 |
|
|
241 |
|
|||||
Note: Previously issued statistics may be restated due to fund closures and trade adjustments
|
||||||||||||||||||||
WISDOMTREE, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in thousands, except per share amounts) |
||||||||
|
Dec. 31, 2022 |
Dec. 31, 2021 |
||||||
|
(Unaudited) |
|
||||||
ASSETS |
|
|
||||||
Current assets: |
|
|
||||||
Cash and cash equivalents |
$ |
132,101 |
|
$ |
140,709 |
|
||
Financial instruments owned, at fair value |
|
126,239 |
|
|
127,166 |
|
||
Accounts receivable |
|
30,549 |
|
|
31,864 |
|
||
Prepaid expenses |
|
4,684 |
|
|
3,952 |
|
||
Other current assets |
|
390 |
|
|
276 |
|
||
|
|
|||||||
Total current assets |
|
293,963 |
|
|
303,967 |
|
||
Fixed assets, net |
|
544 |
|
|
557 |
|
||
Indemnification receivable |
|
1,353 |
|
|
21,925 |
|
||
Securities held-to-maturity |
|
259 |
|
|
308 |
|
||
Deferred tax assets, net |
|
10,536 |
|
|
8,881 |
|
||
Investments |
|
35,721 |
|
|
14,238 |
|
||
Right of use assets—operating leases |
|
1,449 |
|
|
520 |
|
||
Goodwill |
|
85,856 |
|
|
85,856 |
|
||
Intangible assets, net |
|
603,567 |
|
|
601,247 |
|
||
Other noncurrent assets |
|
571 |
|
|
361 |
|
||
|
|
|||||||
Total assets |
$ |
1,033,819 |
|
$ |
1,037,860 |
|
||
|
|
|
||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
||||||
LIABILITIES |
|
|
||||||
Current liabilities: |
|
|
||||||
Convertible notes—current |
$ |
174,197 |
|
$ |
— |
|
||
Compensation and benefits payable |
|
36,521 |
|
|
32,782 |
|
||
Fund management and administration payable |
|
24,121 |
|
|
20,661 |
|
||
Deferred consideration—gold payments |
|
16,796 |
|
|
16,739 |
|
||
Income taxes payable |
|
1,599 |
|
|
3,979 |
|
||
Operating lease liabilities |
|
1,125 |
|
|
209 |
|
||
Accounts payable and other liabilities |
|
9,077 |
|
|
9,297 |
|
||
|
|
|||||||
Total current liabilities |
|
263,436 |
|
|
83,667 |
|
||
Convertible notes—long term |
|
147,019 |
|
|
318,624 |
|
||
Deferred consideration—gold payments |
|
183,494 |
|
|
211,323 |
|
||
Operating lease liabilities |
|
339 |
|
|
328 |
|
||
Other noncurrent liabilities |
|
1,351 |
|
|
21,925 |
|
||
|
|
|||||||
Total liabilities |
|
595,639 |
|
|
635,867 |
|
||
Preferred stock—Series A Non-Voting Convertible, par value $0.01; 14.750 shares authorized, issued and outstanding |
|
132,569 |
|
|
132,569 |
|
||
|
|
|||||||
STOCKHOLDERS’ EQUITY |
|
|||||||
Common stock, par value $0.01; 400,000 shares authorized: |
|
|||||||
Issued and outstanding: 146,517 and 145,107 at December 31, 2022 and December 31, 2021, respectively |
|
1,465 |
|
|
1,451 |
|
||
Additional paid-in capital |
|
291,847 |
|
|
289,736 |
|
||
Accumulated other comprehensive (loss)/income |
|
(1,420 |
) |
|
682 |
|
||
Retained earnings/(accumulated deficit) |
|
13,719 |
|
|
(22,445 |
) |
||
|
|
|||||||
Total stockholders’ equity |
|
305,611 |
|
|
269,424 |
|
||
|
|
|||||||
Total liabilities and stockholders’ equity |
$ |
1,033,819 |
|
$ |
1,037,860 |
|
||
WISDOMTREE, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) (Unaudited) |
||||||||
|
|
|||||||
|
Years Ended |
|||||||
|
Dec. 31, 2022 |
Dec. 31, 2021 |
||||||
Cash flows from operating activities: |
|
|
||||||
Net income |
$ |
50,684 |
|
$ |
49,797 |
|
||
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
||||||
Advisory and license fees paid in gold, other precious metals and cryptocurrency |
|
(57,290 |
) |
|
(74,970 |
) |
||
Contractual gold payments |
|
17,108 |
|
|
17,096 |
|
||
Losses on financial instruments owned, at fair value |
|
16,516 |
|
|
3,715 |
|
||
Stock-based compensation |
|
10,385 |
|
|
9,998 |
|
||
Gain on revaluation of deferred consideration—gold payments |
|
(27,765 |
) |
|
(2,018 |
) |
||
Amortization of issuance costs—convertible notes |
|
2,592 |
|
|
2,187 |
|
||
Deferred income taxes |
|
(1,296 |
) |
|
316 |
|
||
Amortization of right of use asset |
|
963 |
|
|
1,950 |
|
||
Depreciation and amortization |
|
262 |
|
|
738 |
|
||
Impairments |
|
— |
|
|
16,156 |
|
||
Gain on sale—Canadian ETF business, including remeasurement of contingent consideration |
|
— |
|
|
(787 |
) |
||
Other |
|
386 |
|
|
(272 |
) |
||
Changes in operating assets and liabilities: |
|
|
||||||
Accounts receivable |
|
(720 |
) |
|
(3,506 |
) |
||
Prepaid expenses |
|
(808 |
) |
|
(139 |
) |
||
Gold and other precious metals |
|
41,847 |
|
|
57,417 |
|
||
Other assets |
|
(309 |
) |
|
(394 |
) |
||
Intangibles—software development |
|
(2,370 |
) |
|
— |
|
||
Fund management and administration payable |
|
3,723 |
|
|
1,348 |
|
||
Compensation and benefits payable |
|
4,485 |
|
|
10,242 |
|
||
Income taxes payable |
|
(2,308 |
) |
|
3,101 |
|
||
Operating lease liabilities |
|
(965 |
) |
|
(15,560 |
) |
||
Accounts payable and other liabilities |
|
(33 |
) |
|
(1,097 |
) |
||
|
|
|
||||||
Net cash provided by operating activities |
|
55,087 |
|
|
75,318 |
|
||
Cash flows from investing activities: |
|
|
||||||
Purchase of financial instruments owned, at fair value |
|
(67,734 |
) |
|
(115,526 |
) |
||
Purchase of investments |
|
(21,863 |
) |
|
(5,750 |
) |
||
Purchase of fixed assets |
|
(220 |
) |
|
(293 |
) |
||
Proceeds from the sale of financial instruments owned, at fair value |
|
52,115 |
|
|
19,441 |
|
||
Proceeds from the sale—Canadian ETF business, net, including receipt of contingent consideration |
|
— |
|
|
2,360 |
|
||
Proceeds from held-to-maturity securities maturing or called prior to maturity |
|
45 |
|
|
136 |
|
||
|
|
|
||||||
Net cash used in investing activities |
|
(37,657 |
) |
|
(99,632 |
) |
||
Cash flows from financing activities: |
|
|
||||||
Dividends paid |
|
(19,362 |
) |
|
(19,459 |
) |
||
Shares repurchased |
|
(3,418 |
) |
|
(34,506 |
) |
||
Convertible notes issuance costs |
|
— |
|
|
(4,297 |
) |
||
Proceeds from the issuance of convertible notes |
|
— |
|
|
150,000 |
|
||
Proceeds from exercise of stock options |
|
— |
|
|
815 |
|
||
|
|
|
||||||
Net cash (used in)/provided by financing activities |
|
(22,780 |
) |
|
92,553 |
|
||
|
|
|
||||||
Decrease in cash flow due to changes in foreign exchange rate |
|
(3,258 |
) |
|
(955 |
) |
||
|
|
|||||||
Net (decrease)/increase in cash and cash equivalents |
|
(8,608 |
) |
|
67,284 |
|
||
Cash and cash equivalents—beginning of period |
|
140,709 |
|
|
73,425 |
|
||
|
|
|||||||
Cash and cash equivalents—end of period |
$ |
132,101 |
|
$ |
140,709 |
|
||
|
|
|
||||||
|
|
|
||||||
Supplemental disclosure of cash flow information: |
|
|||||||
Cash paid for income taxes |
$ |
12,500 |
|
$ |
8,456 |
|
||
Cash paid for interest |
$ |
12,313 |
|
$ |
9,898 |
|
||
Contacts
Investor Relations
Jeremy Campbell
+1.646.522.2602
Jeremy.campbell@wisdomtree.com
Media Relations
Jessica Zaloom
+1.917.267.3735
jzaloom@wisdomtree.com
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