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Ownership percentage following the transactions for: | |||||||||||||
Date | Transaction description | Total shares | OM plc | HNA | Note | ||||||||
October 15, 2014 | IPO of OMAM shares by OM plc | 24,231,375 | 78.8 | % | — | % | (1) | ||||||
June 22, 2015 | Secondary public offering by OM plc | 15,295,000 | 65.8 | % | — | % | (2) | ||||||
December 16, 2016 | Secondary public offering by OM plc | 14,950,000 | — | — | (3) | ||||||||
December 16, 2016 | Repurchase and retirement of shares by OMAM | 6,000,000 | 51.1 | % | — | % | (4) | ||||||
May 12, 2017 | Sale of shares from OM plc to HNA | 11,414,676 | 40.9 | % | 9.95 | % | (5) | ||||||
May 19, 2017 | Secondary public offering by OM plc | 19,895,000 | — | — | (6) | ||||||||
May 19, 2017 | Repurchase and retirement of shares by OMAM | 5,000,000 | 20.1 | % | 10.4 | % | (4) | ||||||
November 10, 2017 | Sale of shares from OM plc to HNA | 15,960,553 | 5.51 | % | 24.95 | % | (7) | ||||||
November 17, 2017 | Secondary public offering by OM plc | 6,039,630 | — | % | 24.95 | % | (8) |
(1) | Includes 2,231,375 shares purchased by the underwriters of the offering under their overallotment option. |
(2) | Includes 1,995,000 shares purchased by the underwriters of the offering under their overallotment option. |
(3) | Includes 1,950,000 shares purchased by the underwriters of the offering under their overallotment option. |
(4) | Purchased pursuant to the share repurchase program described below. All shares repurchased by the Company were retired. |
(5) | Following the May 12, 2017 sale of shares from OM plc to HNA, on May 24, 2017, OM plc appointed Dr. Guang Yang of HNA as an OM plc director. |
(6) | Includes 2,595,000 shares purchased by the underwriters of the offering under their overallotment option. |
(7) | Following the November 10, 2017 sale of shares from OM plc to HNA, HNA acquired the right to appoint two directors to the Company’s board. |
(8) | Upon completion of the November 17, 2017 offering, OM plc indirectly owned 1,000 of the Company’s outstanding ordinary shares. |
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Landmark | ||||
Purchase price | ||||
Cash | $ | 239.2 | ||
Seller’s expenses | 3.5 | |||
Total consideration | 242.7 | |||
Identifiable assets and liabilities | ||||
Cash | 23.4 | |||
Receivables | 8.5 | |||
Indefinite-life trade name | 1.0 | |||
Amortizable intangible asset management contracts | 85.0 | |||
Fixed assets | 5.1 | |||
Other current assets (liabilities), net | (26.7 | ) | ||
Assets (liabilities), net | (1.7 | ) | ||
Total identifiable assets and liabilities | 94.6 | |||
Goodwill | $ | 148.1 |
For the years ended December 31, | |||||||
2016 | 2015 | ||||||
Revenues | $ | 713.5 | $ | 780.1 | |||
Total operating expenses | 594.7 | 651.9 | |||||
Income from continuing operations before taxes | 109.2 | 114.8 | |||||
Net income attributable to OMAM | 91.7 | 97.6 | |||||
Net income per share attributable to OMAM shareholders: | |||||||
Basic | $0.77 | $0.81 | |||||
Diluted | $0.77 | $0.81 |
|
2017 | 2016 | ||||||
Investments of consolidated Funds held at fair value | $ | 136.7 | $ | 35.5 | |||
Equity-accounted investments in unconsolidated Funds (Note 7) | — | 30.5 | |||||
Other investments held at fair value | 87.4 | 17.5 | |||||
Investments related to long-term incentive compensation plans held at fair value | 95.2 | 78.1 | |||||
Total investments held at fair value | $ | 319.3 | $ | 161.6 | |||
Equity-accounted investments in Affiliates (Note 7) | 1.6 | 55.2 | |||||
Investments in Affiliates carried at cost | 53.8 | — | |||||
Other investments* | 6.4 | 52.0 | |||||
Total investments per Consolidated Balance Sheets | $ | 381.1 | $ | 268.8 |
2017 | 2016 | 2015 | |||||||||
Investment return of equity-accounted investments in unconsolidated Funds (Note 7) | $ | 1.8 | $ | 1.2 | $ | 0.3 | |||||
Realized and unrealized gains on other investments held at fair value | 9.4 | 0.8 | — | ||||||||
Investment return of held for sale investments | 1.7 | 0.1 | — | ||||||||
Total return on OMAM investments | 12.9 | 2.1 | 0.3 | ||||||||
Investment return of equity-accounted investments in Affiliates (Note 7)* | 14.5 | 15.1 | 12.7 | ||||||||
Total investment income per Consolidated Statement of Operations | $ | 27.4 | $ | 17.2 | $ | 13.0 |
|
Quoted prices in active markets (Level I) | Significant other observable inputs (Level II) | Significant unobservable inputs (Level III) | Uncategorized | Total value, December 31, 2017 | |||||||||||||||
Assets of OMAM and consolidated Funds(1) | |||||||||||||||||||
Common and preferred stock | $ | 83.8 | $ | — | $ | — | $ | — | $ | 83.8 | |||||||||
Short-term investment funds | 0.5 | — | — | — | 0.5 | ||||||||||||||
Other investments | 0.4 | — | — | 51.5 | 51.9 | ||||||||||||||
Derivatives | 0.3 | 0.2 | — | — | 0.5 | ||||||||||||||
Consolidated Funds total | 85.0 | 0.2 | — | 51.5 | 136.7 | ||||||||||||||
Investments in separate accounts(2) | 46.1 | — | — | — | 46.1 | ||||||||||||||
Investments related to long-term incentive compensation plans(3) | 95.2 | — | — | — | 95.2 | ||||||||||||||
Investments in unconsolidated Funds(4) | — | — | — | 41.3 | 41.3 | ||||||||||||||
OMAM total | 141.3 | — | — | 41.3 | 182.6 | ||||||||||||||
Total fair value assets | $ | 226.3 | $ | 0.2 | $ | — | $ | 92.8 | $ | 319.3 | |||||||||
Liabilities of consolidated Funds(1) | |||||||||||||||||||
Common stock | $ | (7.2 | ) | $ | — | $ | — | $ | — | $ | (7.2 | ) | |||||||
Derivatives | (0.5 | ) | (0.2 | ) | — | — | (0.7 | ) | |||||||||||
Consolidated Funds total | (7.7 | ) | (0.2 | ) | — | — | (7.9 | ) | |||||||||||
Total fair value liabilities | $ | (7.7 | ) | $ | (0.2 | ) | $ | — | $ | — | $ | (7.9 | ) |
Quoted prices in active markets (Level I) | Significant other observable inputs (Level II) | Significant unobservable inputs (Level III) | Uncategorized | Total value, December 31, 2016 | |||||||||||||||
Assets of OMAM and consolidated Funds(1) | |||||||||||||||||||
Common and preferred stock | $ | 35.1 | $ | — | $ | — | $ | — | $ | 35.1 | |||||||||
Short-term investment funds | 0.4 | — | — | — | 0.4 | ||||||||||||||
Consolidated Funds total | 35.5 | — | — | — | 35.5 | ||||||||||||||
Investments in separate accounts(2) | 7.5 | — | — | — | 7.5 | ||||||||||||||
Investments related to long-term incentive compensation plans(3) | 78.1 | — | — | — | 78.1 | ||||||||||||||
Investments in unconsolidated Funds(4) | — | — | — | 40.5 | 40.5 | ||||||||||||||
OMAM total | 85.6 | — | — | 40.5 | 126.1 | ||||||||||||||
Total fair value assets | $ | 121.1 | $ | — | $ | — | $ | 40.5 | $ | 161.6 | |||||||||
Liabilities of OMAM and consolidated Funds(1) | |||||||||||||||||||
Common stock | $ | (5.0 | ) | $ | — | $ | — | $ | — | $ | (5.0 | ) | |||||||
Consolidated Funds total | (5.0 | ) | — | — | — | (5.0 | ) | ||||||||||||
Derivative securities | — | (0.1 | ) | — | — | (0.1 | ) | ||||||||||||
OMAM total | — | (0.1 | ) | — | — | (0.1 | ) | ||||||||||||
Total fair value liabilities | $ | (5.0 | ) | $ | (0.1 | ) | $ | — | $ | — | $ | (5.1 | ) |
(1) | Assets and liabilities measured at fair value are comprised of financial investments managed by the Company’s Affiliates. $136.7 million in assets and $7.9 million in liabilities at December 31, 2017 and $35.5 million in assets and $5.0 million in liabilities at December 31, 2016 are the result of the consolidation of Funds sponsored by the Company’s Affiliates. |
(2) | Investments in separate accounts of $46.1 million at December 31, 2017 consist of approximately 1% of cash equivalents and 99% of equity securities. Investments in separate accounts of $7.5 million at December 31, 2016, consist of approximately 28% of cash equivalents and 72% of equity securities. The Company has valued these using the published price as of the measurement date. Accordingly, the Company has classified these investments as Level I. |
(3) | Investments related to long-term compensation plans of $95.2 million and $78.1 million at December 31, 2017 and 2016, respectively, are investments in publicly registered daily redeemable funds (some managed by Affiliates), which the Company has classified as trading securities and valued using the published price as of the measurement dates. Accordingly, the Company has classified these investments as Level I. |
(4) | The uncategorized amounts of $41.3 million and $40.5 million at December 31, 2017 and December 31, 2016, respectively, relate to investments in unconsolidated Funds which consist primarily of investments in Funds advised by Affiliates and are valued using NAV which the Company relies on to determine their fair value as a practical expedient and has therefore not classified these investments in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to amounts presented in the Consolidated Balance Sheets. These unconsolidated Funds consist primarily of real estate investments Funds and UCITS. The NAVs that have been provided by investees have been derived from the fair values of the underlying investments as of the measurement dates. |
|
2017 | 2016 | ||||||
Assets | |||||||
Investments at fair value | $ | 106.7 | $ | 14.9 | |||
Other assets of consolidated Funds | 16.8 | 0.6 | |||||
Total Assets | $ | 123.5 | $ | 15.5 | |||
Liabilities | |||||||
Other liabilities of consolidated Funds | $ | 3.3 | $ | 0.7 | |||
Total Liabilities | $ | 3.3 | $ | 0.7 |
2017 | 2016 | ||||||
Unconsolidated VIE assets | $ | 6,001.1 | $ | 6,006.3 | |||
Unconsolidated VIE liabilities | $ | 3,843.7 | $ | 3,740.2 | |||
Equity interests on the Consolidated Balance Sheet | $ | 54.4 | $ | 54.2 | |||
Maximum risk of loss(1) | $ | 58.5 | $ | 58.5 |
(1) | Includes equity investments the Company has made or is required to make and any earned but uncollected management/incentive fees. The Company does not record performance/incentive allocations until the respective measurement period has ended. |
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For the year ended December 31, | ||||||||||||
Statements of Income | 2017 | 2016 | 2015 | |||||||||
Net revenues(1) | $ | 318.9 | $ | 340.9 | $ | 342.6 | ||||||
Operating income | 94.1 | 98.4 | 114.8 | |||||||||
Other income, net | 197.4 | 161.9 | 97.8 | |||||||||
Income before income taxes | 291.5 | 260.3 | 212.6 | |||||||||
Less income tax expense | 5.5 | 8.2 | 5.9 | |||||||||
Exclude: non-controlling interests income | 247.6 | 213.7 | 177.6 | |||||||||
Net income attributable to controlling interests | $ | 38.4 | $ | 38.4 | $ | 29.1 | ||||||
OMAM equity in net income of equity method investees | $ | 16.3 | $ | 16.3 | $ | 13.0 |
As of December 31, | |||||||
Balance Sheets | 2017 | 2016 | |||||
Total assets | $ | 3.5 | $ | 2,661.5 | |||
Total liabilities | 1.6 | 1,105.9 | |||||
Non-controlling interests in subsidiaries | 0.3 | 1,477.9 | |||||
Members’ equity | $ | 1.6 | $ | 77.7 | |||
OMAM equity investment and undistributed earnings of affiliated companies, before consolidating and reconciling adjustments | $ | 1.6 | $ | 55.9 | |||
Consolidating and reconciling adjustments: | |||||||
Goodwill attributable to equity method investment | — | 29.8 | |||||
OMAM investment in equity method investees | $ | 1.6 | $ | 85.7 |
(1) | Net revenues include advisory fees for asset management services and investment income, including interest and dividends from consolidated investment partnerships. |
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2017 | 2016 | ||||||
Leasehold improvements | $ | 32.4 | $ | 31.7 | |||
Office equipment | 28.2 | 25.6 | |||||
Furniture and fixtures | 7.2 | 7.0 | |||||
Building | 2.9 | 2.9 | |||||
Software and web development | 38.7 | 28.6 | |||||
Fixed assets, at cost | 109.4 | 95.8 | |||||
Accumulated depreciation and amortization | (67.7 | ) | (56.0 | ) | |||
Fixed assets, net | $ | 41.7 | $ | 39.8 |
Future minimum rentals | |||
2018 | $ | 11.8 | |
2019 | 10.8 | ||
2020 | 10.5 | ||
2021 | 9.8 | ||
2022 | 5.1 | ||
Thereafter | 4.7 | ||
Total | $ | 52.7 |
|
Gross Book Value | Accumulated Impairment | Net Book Value | |||||||||
December 31, 2015 | $ | 160.4 | $ | (33.9 | ) | $ | 126.5 | ||||
Additions | 146.2 | — | 146.2 | ||||||||
Impairments | — | — | — | ||||||||
Disposals | — | — | — | ||||||||
December 31, 2016 | $ | 306.6 | $ | (33.9 | ) | $ | 272.7 | ||||
Additions | 1.9 | — | 1.9 | ||||||||
Impairments | — | — | — | ||||||||
Disposals | — | — | — | ||||||||
December 31, 2017 | $ | 308.5 | $ | (33.9 | ) | $ | 274.6 |
Gross Book Value | Accumulated Amortization & Impairment | Net Book Value | |||||||||
December 31, 2015 | $ | 23.3 | $ | (21.8 | ) | $ | 1.5 | ||||
Additions | 85.0 | — | 85.0 | ||||||||
Amortization | — | (2.6 | ) | (2.6 | ) | ||||||
Disposals | — | — | — | ||||||||
December 31, 2016 | $ | 108.3 | $ | (24.4 | ) | $ | 83.9 | ||||
Additions | — | — | — | ||||||||
Amortization | — | (6.6 | ) | (6.6 | ) | ||||||
Disposals | — | — | — | ||||||||
December 31, 2017 | $ | 108.3 | $ | (31.0 | ) | $ | 77.3 |
2018 | $ | 6.6 | |
2019 | 6.6 | ||
2020 | 6.6 | ||
2021 | 6.6 | ||
2022 | 6.5 | ||
Thereafter | 44.4 | ||
Total | $ | 77.3 |
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2017(1) | 2016 | ||||||
Fees receivable from unconsolidated Funds | $ | 59.0 | $ | 40.8 | |||
Fees receivable from OM plc business units | — | 2.0 | |||||
Other amounts due from related parties | — | 2.8 | |||||
Total amounts due from related parties | $ | 59.0 | $ | 45.6 |
2017(1) | 2016 | ||||||
Other amounts due to related parties | $ | — | $ | 0.4 | |||
Other amounts due to OM plc(3) | — | 97.0 | |||||
Total current payables to related parties | — | 97.4 | |||||
Other amounts due to OM plc(3) | — | 58.9 | |||||
Total long-term payables to related parties | — | 58.9 | |||||
Total amounts due to related parties | $ | — | $ | 156.3 |
2017 | 2016 | ||||||
Investments in equity-accounted investees (Note 7) | 1.6 | 85.7 | |||||
Total related party investments | $ | 1.6 | $ | 85.7 |
Revenues: | 2017 | 2016 | 2015 | ||||||||
Management fees collected from OM plc business units(1) | $ | 8.5 | $ | 7.8 | $ | 9.3 | |||||
Management fees collected from unconsolidated Funds(2) | 274.9 | 131.0 | 107.0 | ||||||||
Performance fees collected from unconsolidated Funds(2) | 0.1 | 4.2 | 1.9 | ||||||||
Total related party revenues (including discontinued operations) | $ | 283.5 | $ | 143.0 | $ | 118.2 | |||||
Expenses: | |||||||||||
Rent and administrative costs recharged by OM plc business units(4) | 0.2 | 1.0 | 1.7 | ||||||||
Restricted stock grants of OM plc equity to OMAM employees (Note 18) | — | 0.1 | 0.5 | ||||||||
Recharged OM plc operational costs(5) | 0.4 | 0.9 | 1.8 | ||||||||
Total related party expenses (including discontinued operations) | $ | 0.6 | $ | 2.0 | $ | 4.0 |
(1) | OM plc was considered a related party through November 17, 2017, at which point OM plc sold all but a deminimus amount of the Company’s ordinary shares (see Note 1). Therefore, revenue and expenses reported in the table above reflect OM plc as a related party through November 17, 2017. OM plc was not considered a related party at December 31, 2017. |
(2) | Transactions with unconsolidated Affiliate-sponsored Funds are considered related party items on the basis of the Company’s significant influence over the activities of such entities in its capacity as investment advisor thereto. These transactions are comprised of fees for advisory services and investments in unconsolidated “master” Funds held by consolidated “feeder” Funds. |
(3) | During 2016, the Company and OM plc agreed to amend the Deferred Tax Asset Deed. Under the terms of the Deferred Tax Asset Deed, as amended, the Company agreed to make a payment of the net present value of the future tax benefits due to OM plc valued as of December 31, 2016. This payment, originally valued at $142.6 million, was to be made over three installments, on June 30, 2017, December 31, 2017 and June 30, 2018. The initial payment of $45.5 million was paid on June 30, 2017, however as a result of the Tax Act, no additional payments have been made pending the continued evaluation of the Tax Act’s impact on the value of the Deferred Tax Asset Deed. The reduction of the corporate tax rate and other provisions of the Tax Act resulted in a decrease to the Deferred Tax Asset Deed of approximately$51.8 million for the year ended December 31, 2017, however there remains a possibility for additional reductions pending continued evaluation of the Tax Act’s impact on the value of the Deferred Tax Asset Deed. |
(4) | The Company conducts a portion of its distribution activities out of Asia and the United Kingdom, and has entered into contractual arrangements with Related Business Units domiciled there to share their premises and leverage certain of their administrative functions. With respect to premises in Asia, such arrangements ended in the first half of 2016. |
(5) | OM plc has historically provided the Company with various oversight services, including governance, which includes compensation for board and executive committees, investor relations, procurement of insurance coverage, human resources, financial reporting, internal audit, treasury, systems, risk and tax services. All of these services have been transitioned to the Company and therefore the cost charged by OM plc has decreased. That portion of the above costs which (i) were directly attributable to the Company, (ii) have been charged to the Company by OM plc and (iii) have been paid to OM plc by the Company, have been recorded in the Company’s Consolidated Financial Statements and were $0.4 million, $0.9 million, and $1.8 million for the years ended December 31, 2017, 2016 and 2015, respectively. |
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2017 | 2016 | ||||||
Accounts payable | 5.2 | 5.1 | |||||
Accrued expenses | 39.9 | 29.8 | |||||
Accrued interest payable | 7.6 | 8.4 | |||||
Other | 2.2 | 2.5 | |||||
Total accounts payable and accrued expenses | $ | 54.9 | $ | 45.8 |
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2017 | 2016 | ||||||
Share-based payments liability (Note 18) | $ | 188.8 | $ | 53.7 | |||
Non-current compensation payable | 0.1 | 0.1 | |||||
Profit interests compensation liability (Note 2) | 195.0 | 159.2 | |||||
Voluntary deferral plan liability (Note 17) | 95.1 | 78.0 | |||||
Total other compensation liabilities | $ | 479.0 | $ | 291.0 |
|
December 31, 2017 | December 31, 2016 | ||||||||||||||||||||||
(in millions) | Maturity amount | Discount and debt issuance costs | Carrying value | Fair Value | Carrying value | Fair Value | |||||||||||||||||
Long-term bonds: | |||||||||||||||||||||||
4.80% Senior Notes Due 2026 | $ | 275.0 | $ | (3.1 | ) | $ | 271.9 | $ | 285.7 | $ | 271.6 | $ | 271.0 | ||||||||||
5.125% Senior Notes Due 2031 | 125.0 | (4.1 | ) | 120.9 | 124.6 | 120.7 | 107.9 | ||||||||||||||||
Total long-term bonds | $ | 400.0 | $ | (7.2 | ) | $ | 392.8 | $ | 410.3 | $ | 392.3 | $ | 378.9 |
Future minimum debt commitments | ||||
2018 | $ | — | ||
2019 | 33.5 | |||
2020 | — | |||
2021 | — | |||
2022 | — | |||
Thereafter | 400.0 | |||
Total | $ | 433.5 |
|
2017 | 2016 | 2015 | |||||||||
Current: | |||||||||||
Federal | $ | 30.0 | $ | 17.3 | $ | 40.8 | |||||
State | 5.9 | 2.6 | 7.4 | ||||||||
Foreign | 3.6 | 1.4 | 1.3 | ||||||||
Total current | 39.5 | 21.3 | 49.5 | ||||||||
Deferred: | |||||||||||
Federal | 102.7 | 19.6 | (4.5 | ) | |||||||
State | (9.3 | ) | (0.2 | ) | (4.5 | ) | |||||
Foreign | (0.1 | ) | 0.1 | 6.1 | |||||||
Total deferred | 93.3 | 19.5 | (2.9 | ) | |||||||
Total tax expense | $ | 132.8 | $ | 40.8 | $ | 46.6 |
2017 | 2016 | 2015 | ||||||
Tax at U.S. federal statutory income tax rate | 35.0 | % | 35.0 | % | 35.0 | % | ||
State income taxes, net of federal benefit | 1.7 | % | 3.0 | % | 3.0 | % | ||
Non-deductible expenses | 0.2 | % | — | % | — | % | ||
DTA Deed liability revaluation adjustment | (12.8 | )% | — | % | — | % | ||
Interest expense | (10.2 | )% | (12.1 | )% | (9.3 | )% | ||
Dividends from foreign subsidiaries | — | % | — | % | 0.3 | % | ||
Adjustment to liabilities for uncertain tax positions | (1.2 | )% | 0.9 | % | (0.4 | )% | ||
Change in valuation allowance | 1.1 | % | (0.6 | )% | (3.4 | )% | ||
Effect of foreign operations | (4.0 | )% | (0.7 | )% | (1.0 | )% | ||
Effect of changes in tax law | 86.4 | % | — | % | (0.5 | )% | ||
Effect of income from non-controlling interest | (1.3 | )% | — | % | — | % | ||
Other | (1.4 | )% | (0.2 | )% | (0.5 | )% | ||
Effective income tax rate for continuing operations | 93.5 | % | 25.3 | % | 23.2 | % |
2017 | 2016 | ||||||
Deferred tax assets: | |||||||
Interest expense | $ | 80.9 | $ | 150.5 | |||
Federal net operating loss | 1.8 | 3.7 | |||||
State net operating loss carry forwards | 8.6 | 7.6 | |||||
Investment in partnerships | 140.3 | 140.1 | |||||
Foreign tax credit carry forwards | — | 9.1 | |||||
Intangible assets | 0.9 | 1.4 | |||||
Employee compensation | 8.9 | 16.5 | |||||
Other | 2.6 | 5.6 | |||||
Cash flow hedge | 5.1 | 5.9 | |||||
Investments | 0.1 | — | |||||
Total deferred tax assets | 249.2 | 340.4 | |||||
Valuation allowance | (8.6 | ) | (5.5 | ) | |||
Deferred tax assets, net of valuation allowance | 240.6 | 334.9 | |||||
Deferred tax liabilities: | |||||||
Investments | — | 2.2 | |||||
Net deferred tax asset | $ | 240.6 | $ | 332.7 |
2017 | 2016 | 2015 | |||||||||
Balance as of January 1 | $ | 91.3 | $ | 93.5 | $ | 93.9 | |||||
Additions based on current year tax positions | 0.9 | — | — | ||||||||
Reductions related to lapses of statutes of limitations | (3.5 | ) | (2.2 | ) | (0.4 | ) | |||||
Balance as of December 31 | $ | 88.7 | $ | 91.3 | $ | 93.5 |
|
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2017 | 2016 | 2015 | |||||||||
Balance, beginning of period | $ | 53.7 | $ | 38.5 | $ | 42.3 | |||||
Amortization and revaluation of granted awards | 135.8 | 15.6 | 0.2 | ||||||||
Reclassification to profit interests award | — | — | (2.8 | ) | |||||||
Repurchases (cash settled) | (0.7 | ) | (0.4 | ) | (1.2 | ) | |||||
Balance, end of period | $ | 188.8 | $ | 53.7 | $ | 38.5 |
2017 | 2016 | 2015 | |||||||||||||||||||
OM Asset Management plc awards | Shares granted | Weighted average fair value | Shares granted | Weighted average fair value | Shares granted | Weighted average fair value | |||||||||||||||
RSAs | 342,637 | $ | 15.13 | 506,640 | $ | 10.89 | 559,709 | $ | 17.60 | ||||||||||||
RSUs | 51,779 | 14.45 | 54,556 | 11.25 | 47,055 | 17.65 | |||||||||||||||
Performance-based RSAs | 175,586 | 10.26 | — | — | — | — | |||||||||||||||
Performance-based RSUs | — | — | 189,335 | 10.92 | 451,657 | 24.65 |
2017 | 2016 | 2015 | |||||||||||||||||||
OM Asset Management plc RSAs | Number of shares | Weighted average grant date fair value per share | Number of shares | Weighted average grant date fair value per share | Number of shares | Weighted average grant date fair value per share | |||||||||||||||
Outstanding at beginning of the year | 1,375,201 | $ | 13.77 | 1,566,647 | $ | 15.28 | 1,212,766 | $ | 14.00 | ||||||||||||
Converted during the year | — | — | — | — | — | — | |||||||||||||||
Granted during the year | 342,637 | 15.13 | 506,640 | 10.89 | 559,709 | 17.60 | |||||||||||||||
Forfeited during the year | (802 | ) | 17.65 | (7,288 | ) | 13.65 | (2,128 | ) | 17.65 | ||||||||||||
Exercised during the year | (1,294,109 | ) | 13.97 | (680,573 | ) | 15.10 | (203,700 | ) | 14.00 | ||||||||||||
Other transfers | — | — | (10,225 | ) | 14.00 | — | — | ||||||||||||||
Outstanding at end of the year | 422,927 | $ | 14.26 | 1,375,201 | $ | 13.77 | 1,566,647 | $ | 15.28 |
2017 | 2016 | 2015 | |||||||||||||||||||
OM Asset Management plc RSUs | Number of shares | Weighted average grant date fair value per share | Number of shares | Weighted average grant date fair value per share | Number of shares | Weighted average grant date fair value per share | |||||||||||||||
Outstanding at beginning of the year | 85,923 | $ | 13.59 | 47,055 | $ | 17.65 | — | $ | — | ||||||||||||
Granted during the year | 51,779 | 14.45 | 54,556 | 11.25 | 47,055 | 17.65 | |||||||||||||||
Forfeited during the year | — | — | — | — | — | — | |||||||||||||||
Exercised during the year | (61,479 | ) | 12.93 | (15,688 | ) | 17.65 | — | — | |||||||||||||
Other transfers | — | — | — | — | — | — | |||||||||||||||
Outstanding at end of the year | 76,223 | $ | 14.70 | 85,923 | $ | 13.59 | 47,055 | $ | 17.65 |
2017 | 2016 | 2015 | |||||||||||||||||||
OM Asset Management plc Performance-based RSAs | Number of shares | Weighted average grant date fair value per share | Number of shares | Weighted average grant date fair value per share | Number of shares | Weighted average grant date fair value per share | |||||||||||||||
Outstanding at beginning of the year | — | $ | — | — | $ | — | — | $ | — | ||||||||||||
Granted during the year | 175,586 | 10.26 | — | — | — | — | |||||||||||||||
Forfeited during the year | — | — | — | — | — | — | |||||||||||||||
Exercised during the year | — | — | — | — | — | — | |||||||||||||||
Other transfers | — | — | — | — | — | — | |||||||||||||||
Outstanding at end of the year | 175,586 | $ | 10.26 | — | $ | — | — | $ | — |
2017 | 2016 | 2015 | |||||||||||||||||||
OM Asset Management plc Performance-based RSUs | Number of shares | Weighted average grant date fair value per share | Number of shares | Weighted average grant date fair value per share | Number of shares | Weighted average grant date fair value per share | |||||||||||||||
Outstanding at beginning of the year | 640,992 | $ | 20.59 | 451,657 | $ | 24.65 | — | — | |||||||||||||
Granted during the year | — | — | 189,335 | 10.92 | 451,657 | 24.65 | |||||||||||||||
Forfeited during the year | — | — | — | — | — | — | |||||||||||||||
Exercised during the year | — | — | — | — | — | — | |||||||||||||||
Other transfers | — | — | — | — | — | — | |||||||||||||||
Outstanding at end of the year | 640,992 | $ | 20.59 | 640,992 | $ | 20.59 | 451,657 | $ | 24.65 |
2017 | 2016 | 2015 | ||||||||||||||||||||||||||||||
Number of shares | Weighted average grant date fair value per share GBP | Weighted average grant date fair value per share USD | Number of shares | Weighted average grant date fair value per share GBP | Weighted average grant date fair value per share USD | Number of shares | Weighted average grant date fair value per share GBP | Weighted average grant date fair value per share USD | ||||||||||||||||||||||||
Outstanding at the beginning of the year | 155,132 | £ | 2.03 | $ | 2.53 | 209,801 | £ | 2.00 | $ | 3.00 | 682,346 | £ | 1.77 | $ | 2.92 | |||||||||||||||||
Granted during the year | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||
Forfeited during the year | — | — | — | (8,885 | ) | 2.03 | 2.53 | — | — | — | ||||||||||||||||||||||
Exercised during the year | (155,132 | ) | 2.03 | 2.72 | (113,559 | ) | 1.98 | 2.47 | (472,545 | ) | 1.67 | 2.50 | ||||||||||||||||||||
Other transfers | — | n/a | n/a | 67,775 | n/a | n/a | — | 0 | — | |||||||||||||||||||||||
Outstanding at the end of the year | — | £ | — | $ | — | 155,132 | £ | 2.03 | $ | 2.53 | 209,801 | £ | 2.00 | $ | 3.00 |
|
For the year ended December 31, 2017 | |||||||||||
Pre-Tax | Tax Benefit (Expense) | Net of Tax | |||||||||
Foreign currency translation | $ | 2.9 | $ | — | $ | 2.9 | |||||
Change in net realized and unrealized gain (loss) on derivative securities | 2.6 | (0.8 | ) | 1.8 | |||||||
Other Comprehensive income (loss) | $ | 5.5 | $ | (0.8 | ) | $ | 4.7 |
For the year ended December 31, 2016 | |||||||||||
Pre-Tax | Tax Benefit (Expense) | Net of Tax | |||||||||
Foreign currency translation adjustment | $ | (3.2 | ) | $ | — | $ | (3.2 | ) | |||
Change in net realized and unrealized gain (loss) on derivative securities | (24.6 | ) | 4.3 | (20.3 | ) | ||||||
Other comprehensive income (loss) | $ | (27.8 | ) | $ | 4.3 | $ | (23.5 | ) |
For the year ended December 31, 2015 | |||||||||||
Pre-Tax | Tax Benefit (Expense) | Net of Tax | |||||||||
Foreign currency translation adjustment | $ | (1.5 | ) | $ | — | $ | (1.5 | ) | |||
Change in net realized and unrealized gain (loss) on derivative securities | (8.2 | ) | 1.6 | (6.6 | ) | ||||||
Other comprehensive income (loss) | $ | (9.7 | ) | $ | 1.6 | $ | (8.1 | ) |
Foreign currency translation adjustment | Valuation of derivative securities | Total | ||||||||||
Balance, as of December 31, 2015 | $ | 3.8 | $ | (6.6 | ) | $ | (2.8 | ) | ||||
Other comprehensive income (loss) | (3.2 | ) | (20.3 | ) | (23.5 | ) | ||||||
Balance, as of December 31, 2016 | $ | 0.6 | (26.9 | ) | $ | (26.3 | ) | |||||
Other comprehensive income (loss) | 2.9 | 1.8 | 4.7 | |||||||||
Balance, as of December 31, 2017 | $ | 3.5 | $ | (25.1 | ) | $ | (21.6 | ) |
|
|
|
2017 | 2016 | ||||||
Beginning balance at January 1 | $ | 1.1 | $ | 4.1 | |||
Abandoned lease liability principal payments | (0.8 | ) | (1.1 | ) | |||
Adjustment to sub-lease arrangement on abandoned lease | 0.1 | 0.2 | |||||
Drawdowns on committed funding | — | (2.1 | ) | ||||
Ending balance at December 31 | $ | 0.4 | $ | 1.1 |
|
2017 | |||||||||||||||
First Quarter | Second Quarter | Third Quarter | Fourth Quarter | ||||||||||||
Revenue | $ | 196.2 | $ | 218.8 | $ | 223.2 | $ | 249.2 | |||||||
Operating income | 23.5 | 12.9 | 8.3 | 26.3 | |||||||||||
Income from continuing operations before income taxes | 28.0 | 14.6 | 14.8 | 84.6 | |||||||||||
Net income (loss) | 22.3 | 13.6 | 19.9 | (46.7 | ) | ||||||||||
Net income (loss) attributable to controlling interests | 21.4 | 12.9 | 18.7 | (48.8 | ) | ||||||||||
Basic earnings (loss) per share ($) | $ | 0.19 | $ | 0.12 | $ | 0.17 | $ | (0.45 | ) | ||||||
Diluted earnings (loss) per share ($) | $ | 0.19 | $ | 0.11 | $ | 0.17 | $ | (0.45 | ) | ||||||
Basic shares outstanding (in millions) | 113.5 | 111.3 | 109.0 | 109.0 | |||||||||||
Diluted shares outstanding (in millions) | 114.4 | 111.8 | 109.7 | 109.0 | (1) |
2016 | |||||||||||||||
First Quarter | Second Quarter | Third Quarter | Fourth Quarter | ||||||||||||
Revenue | $ | 149.6 | $ | 156.5 | $ | 170.8 | $ | 186.6 | |||||||
Operating income | 41.0 | 44.0 | 40.2 | 30.4 | |||||||||||
Income from continuing operations before income taxes | 44.0 | 48.0 | 41.7 | 27.1 | |||||||||||
Net income | 30.8 | 36.3 | 34.0 | 25.1 | |||||||||||
Net income attributable to controlling interests | 30.8 | 36.3 | 34.0 | 25.3 | |||||||||||
Basic earnings per share ($) | $ | 0.26 | $ | 0.30 | $ | 0.28 | $ | 0.21 | |||||||
Diluted earnings per share ($) | $ | 0.26 | $ | 0.30 | $ | 0.28 | $ | 0.21 | |||||||
Basic shares outstanding (in millions) | 120.0 | 119.4 | 119.3 | 118.2 | |||||||||||
Diluted shares outstanding (in millions) | 120.0 | 119.6 | 119.7 | 118.8 |
(1) | During periods of net loss, diluted shares are the same as basic shares. |
|
|
Ownership percentage following the transactions for: | |||||||||||||
Date | Transaction description | Total shares | OM plc | HNA | Note | ||||||||
October 15, 2014 | IPO of OMAM shares by OM plc | 24,231,375 | 78.8 | % | — | % | (1) | ||||||
June 22, 2015 | Secondary public offering by OM plc | 15,295,000 | 65.8 | % | — | % | (2) | ||||||
December 16, 2016 | Secondary public offering by OM plc | 14,950,000 | — | — | (3) | ||||||||
December 16, 2016 | Repurchase and retirement of shares by OMAM | 6,000,000 | 51.1 | % | — | % | (4) | ||||||
May 12, 2017 | Sale of shares from OM plc to HNA | 11,414,676 | 40.9 | % | 9.95 | % | (5) | ||||||
May 19, 2017 | Secondary public offering by OM plc | 19,895,000 | — | — | (6) | ||||||||
May 19, 2017 | Repurchase and retirement of shares by OMAM | 5,000,000 | 20.1 | % | 10.4 | % | (4) | ||||||
November 10, 2017 | Sale of shares from OM plc to HNA | 15,960,553 | 5.51 | % | 24.95 | % | (7) | ||||||
November 17, 2017 | Secondary public offering by OM plc | 6,039,630 | — | % | 24.95 | % | (8) |
(1) | Includes 2,231,375 shares purchased by the underwriters of the offering under their overallotment option. |
(2) | Includes 1,995,000 shares purchased by the underwriters of the offering under their overallotment option. |
(3) | Includes 1,950,000 shares purchased by the underwriters of the offering under their overallotment option. |
(4) | Purchased pursuant to the share repurchase program described below. All shares repurchased by the Company were retired. |
(5) | Following the May 12, 2017 sale of shares from OM plc to HNA, on May 24, 2017, OM plc appointed Dr. Guang Yang of HNA as an OM plc director. |
(6) | Includes 2,595,000 shares purchased by the underwriters of the offering under their overallotment option. |
(7) | Following the November 10, 2017 sale of shares from OM plc to HNA, HNA acquired the right to appoint two directors to the Company’s board. |
(8) | Upon completion of the November 17, 2017 offering, OM plc indirectly owned 1,000 of the Company’s outstanding ordinary shares. |
|
Landmark | ||||
Purchase price | ||||
Cash | $ | 239.2 | ||
Seller’s expenses | 3.5 | |||
Total consideration | 242.7 | |||
Identifiable assets and liabilities | ||||
Cash | 23.4 | |||
Receivables | 8.5 | |||
Indefinite-life trade name | 1.0 | |||
Amortizable intangible asset management contracts | 85.0 | |||
Fixed assets | 5.1 | |||
Other current assets (liabilities), net | (26.7 | ) | ||
Assets (liabilities), net | (1.7 | ) | ||
Total identifiable assets and liabilities | 94.6 | |||
Goodwill | $ | 148.1 |
For the years ended December 31, | |||||||
2016 | 2015 | ||||||
Revenues | $ | 713.5 | $ | 780.1 | |||
Total operating expenses | 594.7 | 651.9 | |||||
Income from continuing operations before taxes | 109.2 | 114.8 | |||||
Net income attributable to OMAM | 91.7 | 97.6 | |||||
Net income per share attributable to OMAM shareholders: | |||||||
Basic | $0.77 | $0.81 | |||||
Diluted | $0.77 | $0.81 |
|
2017 | 2016 | ||||||
Investments of consolidated Funds held at fair value | $ | 136.7 | $ | 35.5 | |||
Equity-accounted investments in unconsolidated Funds (Note 7) | — | 30.5 | |||||
Other investments held at fair value | 87.4 | 17.5 | |||||
Investments related to long-term incentive compensation plans held at fair value | 95.2 | 78.1 | |||||
Total investments held at fair value | $ | 319.3 | $ | 161.6 | |||
Equity-accounted investments in Affiliates (Note 7) | 1.6 | 55.2 | |||||
Investments in Affiliates carried at cost | 53.8 | — | |||||
Other investments* | 6.4 | 52.0 | |||||
Total investments per Consolidated Balance Sheets | $ | 381.1 | $ | 268.8 |
2017 | 2016 | 2015 | |||||||||
Investment return of equity-accounted investments in unconsolidated Funds (Note 7) | $ | 1.8 | $ | 1.2 | $ | 0.3 | |||||
Realized and unrealized gains on other investments held at fair value | 9.4 | 0.8 | — | ||||||||
Investment return of held for sale investments | 1.7 | 0.1 | — | ||||||||
Total return on OMAM investments | 12.9 | 2.1 | 0.3 | ||||||||
Investment return of equity-accounted investments in Affiliates (Note 7)* | 14.5 | 15.1 | 12.7 | ||||||||
Total investment income per Consolidated Statement of Operations | $ | 27.4 | $ | 17.2 | $ | 13.0 |
|
Quoted prices in active markets (Level I) | Significant other observable inputs (Level II) | Significant unobservable inputs (Level III) | Uncategorized | Total value, December 31, 2017 | |||||||||||||||
Assets of OMAM and consolidated Funds(1) | |||||||||||||||||||
Common and preferred stock | $ | 83.8 | $ | — | $ | — | $ | — | $ | 83.8 | |||||||||
Short-term investment funds | 0.5 | — | — | — | 0.5 | ||||||||||||||
Other investments | 0.4 | — | — | 51.5 | 51.9 | ||||||||||||||
Derivatives | 0.3 | 0.2 | — | — | 0.5 | ||||||||||||||
Consolidated Funds total | 85.0 | 0.2 | — | 51.5 | 136.7 | ||||||||||||||
Investments in separate accounts(2) | 46.1 | — | — | — | 46.1 | ||||||||||||||
Investments related to long-term incentive compensation plans(3) | 95.2 | — | — | — | 95.2 | ||||||||||||||
Investments in unconsolidated Funds(4) | — | — | — | 41.3 | 41.3 | ||||||||||||||
OMAM total | 141.3 | — | — | 41.3 | 182.6 | ||||||||||||||
Total fair value assets | $ | 226.3 | $ | 0.2 | $ | — | $ | 92.8 | $ | 319.3 | |||||||||
Liabilities of consolidated Funds(1) | |||||||||||||||||||
Common stock | $ | (7.2 | ) | $ | — | $ | — | $ | — | $ | (7.2 | ) | |||||||
Derivatives | (0.5 | ) | (0.2 | ) | — | — | (0.7 | ) | |||||||||||
Consolidated Funds total | (7.7 | ) | (0.2 | ) | — | — | (7.9 | ) | |||||||||||
Total fair value liabilities | $ | (7.7 | ) | $ | (0.2 | ) | $ | — | $ | — | $ | (7.9 | ) |
Quoted prices in active markets (Level I) | Significant other observable inputs (Level II) | Significant unobservable inputs (Level III) | Uncategorized | Total value, December 31, 2016 | |||||||||||||||
Assets of OMAM and consolidated Funds(1) | |||||||||||||||||||
Common and preferred stock | $ | 35.1 | $ | — | $ | — | $ | — | $ | 35.1 | |||||||||
Short-term investment funds | 0.4 | — | — | — | 0.4 | ||||||||||||||
Consolidated Funds total | 35.5 | — | — | — | 35.5 | ||||||||||||||
Investments in separate accounts(2) | 7.5 | — | — | — | 7.5 | ||||||||||||||
Investments related to long-term incentive compensation plans(3) | 78.1 | — | — | — | 78.1 | ||||||||||||||
Investments in unconsolidated Funds(4) | — | — | — | 40.5 | 40.5 | ||||||||||||||
OMAM total | 85.6 | — | — | 40.5 | 126.1 | ||||||||||||||
Total fair value assets | $ | 121.1 | $ | — | $ | — | $ | 40.5 | $ | 161.6 | |||||||||
Liabilities of OMAM and consolidated Funds(1) | |||||||||||||||||||
Common stock | $ | (5.0 | ) | $ | — | $ | — | $ | — | $ | (5.0 | ) | |||||||
Consolidated Funds total | (5.0 | ) | — | — | — | (5.0 | ) | ||||||||||||
Derivative securities | — | (0.1 | ) | — | — | (0.1 | ) | ||||||||||||
OMAM total | — | (0.1 | ) | — | — | (0.1 | ) | ||||||||||||
Total fair value liabilities | $ | (5.0 | ) | $ | (0.1 | ) | $ | — | $ | — | $ | (5.1 | ) |
(1) | Assets and liabilities measured at fair value are comprised of financial investments managed by the Company’s Affiliates. $136.7 million in assets and $7.9 million in liabilities at December 31, 2017 and $35.5 million in assets and $5.0 million in liabilities at December 31, 2016 are the result of the consolidation of Funds sponsored by the Company’s Affiliates. |
(2) | Investments in separate accounts of $46.1 million at December 31, 2017 consist of approximately 1% of cash equivalents and 99% of equity securities. Investments in separate accounts of $7.5 million at December 31, 2016, consist of approximately 28% of cash equivalents and 72% of equity securities. The Company has valued these using the published price as of the measurement date. Accordingly, the Company has classified these investments as Level I. |
(3) | Investments related to long-term compensation plans of $95.2 million and $78.1 million at December 31, 2017 and 2016, respectively, are investments in publicly registered daily redeemable funds (some managed by Affiliates), which the Company has classified as trading securities and valued using the published price as of the measurement dates. Accordingly, the Company has classified these investments as Level I. |
(4) | The uncategorized amounts of $41.3 million and $40.5 million at December 31, 2017 and December 31, 2016, respectively, relate to investments in unconsolidated Funds which consist primarily of investments in Funds advised by Affiliates and are valued using NAV which the Company relies on to determine their fair value as a practical expedient and has therefore not classified these investments in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to amounts presented in the Consolidated Balance Sheets. These unconsolidated Funds consist primarily of real estate investments Funds and UCITS. The NAVs that have been provided by investees have been derived from the fair values of the underlying investments as of the measurement dates. |
|
2017 | 2016 | ||||||
Assets | |||||||
Investments at fair value | $ | 106.7 | $ | 14.9 | |||
Other assets of consolidated Funds | 16.8 | 0.6 | |||||
Total Assets | $ | 123.5 | $ | 15.5 | |||
Liabilities | |||||||
Other liabilities of consolidated Funds | $ | 3.3 | $ | 0.7 | |||
Total Liabilities | $ | 3.3 | $ | 0.7 |
2017 | 2016 | ||||||
Unconsolidated VIE assets | $ | 6,001.1 | $ | 6,006.3 | |||
Unconsolidated VIE liabilities | $ | 3,843.7 | $ | 3,740.2 | |||
Equity interests on the Consolidated Balance Sheet | $ | 54.4 | $ | 54.2 | |||
Maximum risk of loss(1) | $ | 58.5 | $ | 58.5 |
(1) | Includes equity investments the Company has made or is required to make and any earned but uncollected management/incentive fees. The Company does not record performance/incentive allocations until the respective measurement period has ended. |
|
For the year ended December 31, | ||||||||||||
Statements of Income | 2017 | 2016 | 2015 | |||||||||
Net revenues(1) | $ | 318.9 | $ | 340.9 | $ | 342.6 | ||||||
Operating income | 94.1 | 98.4 | 114.8 | |||||||||
Other income, net | 197.4 | 161.9 | 97.8 | |||||||||
Income before income taxes | 291.5 | 260.3 | 212.6 | |||||||||
Less income tax expense | 5.5 | 8.2 | 5.9 | |||||||||
Exclude: non-controlling interests income | 247.6 | 213.7 | 177.6 | |||||||||
Net income attributable to controlling interests | $ | 38.4 | $ | 38.4 | $ | 29.1 | ||||||
OMAM equity in net income of equity method investees | $ | 16.3 | $ | 16.3 | $ | 13.0 |
As of December 31, | |||||||
Balance Sheets | 2017 | 2016 | |||||
Total assets | $ | 3.5 | $ | 2,661.5 | |||
Total liabilities | 1.6 | 1,105.9 | |||||
Non-controlling interests in subsidiaries | 0.3 | 1,477.9 | |||||
Members’ equity | $ | 1.6 | $ | 77.7 | |||
OMAM equity investment and undistributed earnings of affiliated companies, before consolidating and reconciling adjustments | $ | 1.6 | $ | 55.9 | |||
Consolidating and reconciling adjustments: | |||||||
Goodwill attributable to equity method investment | — | 29.8 | |||||
OMAM investment in equity method investees | $ | 1.6 | $ | 85.7 |
(1) | Net revenues include advisory fees for asset management services and investment income, including interest and dividends from consolidated investment partnerships. |
|
2017 | 2016 | ||||||
Leasehold improvements | $ | 32.4 | $ | 31.7 | |||
Office equipment | 28.2 | 25.6 | |||||
Furniture and fixtures | 7.2 | 7.0 | |||||
Building | 2.9 | 2.9 | |||||
Software and web development | 38.7 | 28.6 | |||||
Fixed assets, at cost | 109.4 | 95.8 | |||||
Accumulated depreciation and amortization | (67.7 | ) | (56.0 | ) | |||
Fixed assets, net | $ | 41.7 | $ | 39.8 |
Future minimum rentals | |||
2018 | $ | 11.8 | |
2019 | 10.8 | ||
2020 | 10.5 | ||
2021 | 9.8 | ||
2022 | 5.1 | ||
Thereafter | 4.7 | ||
Total | $ | 52.7 |
|
Gross Book Value | Accumulated Impairment | Net Book Value | |||||||||
December 31, 2015 | $ | 160.4 | $ | (33.9 | ) | $ | 126.5 | ||||
Additions | 146.2 | — | 146.2 | ||||||||
Impairments | — | — | — | ||||||||
Disposals | — | — | — | ||||||||
December 31, 2016 | $ | 306.6 | $ | (33.9 | ) | $ | 272.7 | ||||
Additions | 1.9 | — | 1.9 | ||||||||
Impairments | — | — | — | ||||||||
Disposals | — | — | — | ||||||||
December 31, 2017 | $ | 308.5 | $ | (33.9 | ) | $ | 274.6 |
2018 | $ | 6.6 | |
2019 | 6.6 | ||
2020 | 6.6 | ||
2021 | 6.6 | ||
2022 | 6.5 | ||
Thereafter | 44.4 | ||
Total | $ | 77.3 |
|
2017(1) | 2016 | ||||||
Fees receivable from unconsolidated Funds | $ | 59.0 | $ | 40.8 | |||
Fees receivable from OM plc business units | — | 2.0 | |||||
Other amounts due from related parties | — | 2.8 | |||||
Total amounts due from related parties | $ | 59.0 | $ | 45.6 |
2017(1) | 2016 | ||||||
Other amounts due to related parties | $ | — | $ | 0.4 | |||
Other amounts due to OM plc(3) | — | 97.0 | |||||
Total current payables to related parties | — | 97.4 | |||||
Other amounts due to OM plc(3) | — | 58.9 | |||||
Total long-term payables to related parties | — | 58.9 | |||||
Total amounts due to related parties | $ | — | $ | 156.3 |
2017 | 2016 | ||||||
Investments in equity-accounted investees (Note 7) | 1.6 | 85.7 | |||||
Total related party investments | $ | 1.6 | $ | 85.7 |
Revenues: | 2017 | 2016 | 2015 | ||||||||
Management fees collected from OM plc business units(1) | $ | 8.5 | $ | 7.8 | $ | 9.3 | |||||
Management fees collected from unconsolidated Funds(2) | 274.9 | 131.0 | 107.0 | ||||||||
Performance fees collected from unconsolidated Funds(2) | 0.1 | 4.2 | 1.9 | ||||||||
Total related party revenues (including discontinued operations) | $ | 283.5 | $ | 143.0 | $ | 118.2 | |||||
Expenses: | |||||||||||
Rent and administrative costs recharged by OM plc business units(4) | 0.2 | 1.0 | 1.7 | ||||||||
Restricted stock grants of OM plc equity to OMAM employees (Note 18) | — | 0.1 | 0.5 | ||||||||
Recharged OM plc operational costs(5) | 0.4 | 0.9 | 1.8 | ||||||||
Total related party expenses (including discontinued operations) | $ | 0.6 | $ | 2.0 | $ | 4.0 |
(1) | OM plc was considered a related party through November 17, 2017, at which point OM plc sold all but a deminimus amount of the Company’s ordinary shares (see Note 1). Therefore, revenue and expenses reported in the table above reflect OM plc as a related party through November 17, 2017. OM plc was not considered a related party at December 31, 2017. |
(2) | Transactions with unconsolidated Affiliate-sponsored Funds are considered related party items on the basis of the Company’s significant influence over the activities of such entities in its capacity as investment advisor thereto. These transactions are comprised of fees for advisory services and investments in unconsolidated “master” Funds held by consolidated “feeder” Funds. |
(3) | During 2016, the Company and OM plc agreed to amend the Deferred Tax Asset Deed. Under the terms of the Deferred Tax Asset Deed, as amended, the Company agreed to make a payment of the net present value of the future tax benefits due to OM plc valued as of December 31, 2016. This payment, originally valued at $142.6 million, was to be made over three installments, on June 30, 2017, December 31, 2017 and June 30, 2018. The initial payment of $45.5 million was paid on June 30, 2017, however as a result of the Tax Act, no additional payments have been made pending the continued evaluation of the Tax Act’s impact on the value of the Deferred Tax Asset Deed. The reduction of the corporate tax rate and other provisions of the Tax Act resulted in a decrease to the Deferred Tax Asset Deed of approximately$51.8 million for the year ended December 31, 2017, however there remains a possibility for additional reductions pending continued evaluation of the Tax Act’s impact on the value of the Deferred Tax Asset Deed. |
(4) | The Company conducts a portion of its distribution activities out of Asia and the United Kingdom, and has entered into contractual arrangements with Related Business Units domiciled there to share their premises and leverage certain of their administrative functions. With respect to premises in Asia, such arrangements ended in the first half of 2016. |
(5) | OM plc has historically provided the Company with various oversight services, including governance, which includes compensation for board and executive committees, investor relations, procurement of insurance coverage, human resources, financial reporting, internal audit, treasury, systems, risk and tax services. All of these services have been transitioned to the Company and therefore the cost charged by OM plc has decreased. That portion of the above costs which (i) were directly attributable to the Company, (ii) have been charged to the Company by OM plc and (iii) have been paid to OM plc by the Company, have been recorded in the Company’s Consolidated Financial Statements and were $0.4 million, $0.9 million, and $1.8 million for the years ended December 31, 2017, 2016 and 2015, respectively. |
|
2017 | 2016 | ||||||
Accounts payable | 5.2 | 5.1 | |||||
Accrued expenses | 39.9 | 29.8 | |||||
Accrued interest payable | 7.6 | 8.4 | |||||
Other | 2.2 | 2.5 | |||||
Total accounts payable and accrued expenses | $ | 54.9 | $ | 45.8 |
|
2017 | 2016 | ||||||
Share-based payments liability (Note 18) | $ | 188.8 | $ | 53.7 | |||
Non-current compensation payable | 0.1 | 0.1 | |||||
Profit interests compensation liability (Note 2) | 195.0 | 159.2 | |||||
Voluntary deferral plan liability (Note 17) | 95.1 | 78.0 | |||||
Total other compensation liabilities | $ | 479.0 | $ | 291.0 |
|
December 31, 2017 | December 31, 2016 | ||||||||||||||||||||||
(in millions) | Maturity amount | Discount and debt issuance costs | Carrying value | Fair Value | Carrying value | Fair Value | |||||||||||||||||
Long-term bonds: | |||||||||||||||||||||||
4.80% Senior Notes Due 2026 | $ | 275.0 | $ | (3.1 | ) | $ | 271.9 | $ | 285.7 | $ | 271.6 | $ | 271.0 | ||||||||||
5.125% Senior Notes Due 2031 | 125.0 | (4.1 | ) | 120.9 | 124.6 | 120.7 | 107.9 | ||||||||||||||||
Total long-term bonds | $ | 400.0 | $ | (7.2 | ) | $ | 392.8 | $ | 410.3 | $ | 392.3 | $ | 378.9 |
Future minimum debt commitments | ||||
2018 | $ | — | ||
2019 | 33.5 | |||
2020 | — | |||
2021 | — | |||
2022 | — | |||
Thereafter | 400.0 | |||
Total | $ | 433.5 |
|
2017 | 2016 | 2015 | |||||||||
Current: | |||||||||||
Federal | $ | 30.0 | $ | 17.3 | $ | 40.8 | |||||
State | 5.9 | 2.6 | 7.4 | ||||||||
Foreign | 3.6 | 1.4 | 1.3 | ||||||||
Total current | 39.5 | 21.3 | 49.5 | ||||||||
Deferred: | |||||||||||
Federal | 102.7 | 19.6 | (4.5 | ) | |||||||
State | (9.3 | ) | (0.2 | ) | (4.5 | ) | |||||
Foreign | (0.1 | ) | 0.1 | 6.1 | |||||||
Total deferred | 93.3 | 19.5 | (2.9 | ) | |||||||
Total tax expense | $ | 132.8 | $ | 40.8 | $ | 46.6 |
2017 | 2016 | 2015 | ||||||
Tax at U.S. federal statutory income tax rate | 35.0 | % | 35.0 | % | 35.0 | % | ||
State income taxes, net of federal benefit | 1.7 | % | 3.0 | % | 3.0 | % | ||
Non-deductible expenses | 0.2 | % | — | % | — | % | ||
DTA Deed liability revaluation adjustment | (12.8 | )% | — | % | — | % | ||
Interest expense | (10.2 | )% | (12.1 | )% | (9.3 | )% | ||
Dividends from foreign subsidiaries | — | % | — | % | 0.3 | % | ||
Adjustment to liabilities for uncertain tax positions | (1.2 | )% | 0.9 | % | (0.4 | )% | ||
Change in valuation allowance | 1.1 | % | (0.6 | )% | (3.4 | )% | ||
Effect of foreign operations | (4.0 | )% | (0.7 | )% | (1.0 | )% | ||
Effect of changes in tax law | 86.4 | % | — | % | (0.5 | )% | ||
Effect of income from non-controlling interest | (1.3 | )% | — | % | — | % | ||
Other | (1.4 | )% | (0.2 | )% | (0.5 | )% | ||
Effective income tax rate for continuing operations | 93.5 | % | 25.3 | % | 23.2 | % |
2017 | 2016 | ||||||
Deferred tax assets: | |||||||
Interest expense | $ | 80.9 | $ | 150.5 | |||
Federal net operating loss | 1.8 | 3.7 | |||||
State net operating loss carry forwards | 8.6 | 7.6 | |||||
Investment in partnerships | 140.3 | 140.1 | |||||
Foreign tax credit carry forwards | — | 9.1 | |||||
Intangible assets | 0.9 | 1.4 | |||||
Employee compensation | 8.9 | 16.5 | |||||
Other | 2.6 | 5.6 | |||||
Cash flow hedge | 5.1 | 5.9 | |||||
Investments | 0.1 | — | |||||
Total deferred tax assets | 249.2 | 340.4 | |||||
Valuation allowance | (8.6 | ) | (5.5 | ) | |||
Deferred tax assets, net of valuation allowance | 240.6 | 334.9 | |||||
Deferred tax liabilities: | |||||||
Investments | — | 2.2 | |||||
Net deferred tax asset | $ | 240.6 | $ | 332.7 |
2017 | 2016 | 2015 | |||||||||
Balance as of January 1 | $ | 91.3 | $ | 93.5 | $ | 93.9 | |||||
Additions based on current year tax positions | 0.9 | — | — | ||||||||
Reductions related to lapses of statutes of limitations | (3.5 | ) | (2.2 | ) | (0.4 | ) | |||||
Balance as of December 31 | $ | 88.7 | $ | 91.3 | $ | 93.5 |
|
2017 | 2016 | 2015 | |||||||||
Balance, beginning of period | $ | 53.7 | $ | 38.5 | $ | 42.3 | |||||
Amortization and revaluation of granted awards | 135.8 | 15.6 | 0.2 | ||||||||
Reclassification to profit interests award | — | — | (2.8 | ) | |||||||
Repurchases (cash settled) | (0.7 | ) | (0.4 | ) | (1.2 | ) | |||||
Balance, end of period | $ | 188.8 | $ | 53.7 | $ | 38.5 |
2017 | 2016 | 2015 | |||||||||||||||||||
OM Asset Management plc awards | Shares granted | Weighted average fair value | Shares granted | Weighted average fair value | Shares granted | Weighted average fair value | |||||||||||||||
RSAs | 342,637 | $ | 15.13 | 506,640 | $ | 10.89 | 559,709 | $ | 17.60 | ||||||||||||
RSUs | 51,779 | 14.45 | 54,556 | 11.25 | 47,055 | 17.65 | |||||||||||||||
Performance-based RSAs | 175,586 | 10.26 | — | — | — | — | |||||||||||||||
Performance-based RSUs | — | — | 189,335 | 10.92 | 451,657 | 24.65 |
2017 | 2016 | 2015 | |||||||||||||||||||
OM Asset Management plc RSAs | Number of shares | Weighted average grant date fair value per share | Number of shares | Weighted average grant date fair value per share | Number of shares | Weighted average grant date fair value per share | |||||||||||||||
Outstanding at beginning of the year | 1,375,201 | $ | 13.77 | 1,566,647 | $ | 15.28 | 1,212,766 | $ | 14.00 | ||||||||||||
Converted during the year | — | — | — | — | — | — | |||||||||||||||
Granted during the year | 342,637 | 15.13 | 506,640 | 10.89 | 559,709 | 17.60 | |||||||||||||||
Forfeited during the year | (802 | ) | 17.65 | (7,288 | ) | 13.65 | (2,128 | ) | 17.65 | ||||||||||||
Exercised during the year | (1,294,109 | ) | 13.97 | (680,573 | ) | 15.10 | (203,700 | ) | 14.00 | ||||||||||||
Other transfers | — | — | (10,225 | ) | 14.00 | — | — | ||||||||||||||
Outstanding at end of the year | 422,927 | $ | 14.26 | 1,375,201 | $ | 13.77 | 1,566,647 | $ | 15.28 |
2017 | 2016 | 2015 | |||||||||||||||||||
OM Asset Management plc Performance-based RSAs | Number of shares | Weighted average grant date fair value per share | Number of shares | Weighted average grant date fair value per share | Number of shares | Weighted average grant date fair value per share | |||||||||||||||
Outstanding at beginning of the year | — | $ | — | — | $ | — | — | $ | — | ||||||||||||
Granted during the year | 175,586 | 10.26 | — | — | — | — | |||||||||||||||
Forfeited during the year | — | — | — | — | — | — | |||||||||||||||
Exercised during the year | — | — | — | — | — | — | |||||||||||||||
Other transfers | — | — | — | — | — | — | |||||||||||||||
Outstanding at end of the year | 175,586 | $ | 10.26 | — | $ | — | — | $ | — |
2017 | 2016 | 2015 | |||||||||||||||||||
OM Asset Management plc RSUs | Number of shares | Weighted average grant date fair value per share | Number of shares | Weighted average grant date fair value per share | Number of shares | Weighted average grant date fair value per share | |||||||||||||||
Outstanding at beginning of the year | 85,923 | $ | 13.59 | 47,055 | $ | 17.65 | — | $ | — | ||||||||||||
Granted during the year | 51,779 | 14.45 | 54,556 | 11.25 | 47,055 | 17.65 | |||||||||||||||
Forfeited during the year | — | — | — | — | — | — | |||||||||||||||
Exercised during the year | (61,479 | ) | 12.93 | (15,688 | ) | 17.65 | — | — | |||||||||||||
Other transfers | — | — | — | — | — | — | |||||||||||||||
Outstanding at end of the year | 76,223 | $ | 14.70 | 85,923 | $ | 13.59 | 47,055 | $ | 17.65 |
2017 | 2016 | 2015 | |||||||||||||||||||
OM Asset Management plc Performance-based RSUs | Number of shares | Weighted average grant date fair value per share | Number of shares | Weighted average grant date fair value per share | Number of shares | Weighted average grant date fair value per share | |||||||||||||||
Outstanding at beginning of the year | 640,992 | $ | 20.59 | 451,657 | $ | 24.65 | — | — | |||||||||||||
Granted during the year | — | — | 189,335 | 10.92 | 451,657 | 24.65 | |||||||||||||||
Forfeited during the year | — | — | — | — | — | — | |||||||||||||||
Exercised during the year | — | — | — | — | — | — | |||||||||||||||
Other transfers | — | — | — | — | — | — | |||||||||||||||
Outstanding at end of the year | 640,992 | $ | 20.59 | 640,992 | $ | 20.59 | 451,657 | $ | 24.65 |
2017 | 2016 | 2015 | ||||||||||||||||||||||||||||||
Number of shares | Weighted average grant date fair value per share GBP | Weighted average grant date fair value per share USD | Number of shares | Weighted average grant date fair value per share GBP | Weighted average grant date fair value per share USD | Number of shares | Weighted average grant date fair value per share GBP | Weighted average grant date fair value per share USD | ||||||||||||||||||||||||
Outstanding at the beginning of the year | 155,132 | £ | 2.03 | $ | 2.53 | 209,801 | £ | 2.00 | $ | 3.00 | 682,346 | £ | 1.77 | $ | 2.92 | |||||||||||||||||
Granted during the year | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||
Forfeited during the year | — | — | — | (8,885 | ) | 2.03 | 2.53 | — | — | — | ||||||||||||||||||||||
Exercised during the year | (155,132 | ) | 2.03 | 2.72 | (113,559 | ) | 1.98 | 2.47 | (472,545 | ) | 1.67 | 2.50 | ||||||||||||||||||||
Other transfers | — | n/a | n/a | 67,775 | n/a | n/a | — | 0 | — | |||||||||||||||||||||||
Outstanding at the end of the year | — | £ | — | $ | — | 155,132 | £ | 2.03 | $ | 2.53 | 209,801 | £ | 2.00 | $ | 3.00 |
|
For the year ended December 31, 2017 | |||||||||||
Pre-Tax | Tax Benefit (Expense) | Net of Tax | |||||||||
Foreign currency translation | $ | 2.9 | $ | — | $ | 2.9 | |||||
Change in net realized and unrealized gain (loss) on derivative securities | 2.6 | (0.8 | ) | 1.8 | |||||||
Other Comprehensive income (loss) | $ | 5.5 | $ | (0.8 | ) | $ | 4.7 |
For the year ended December 31, 2016 | |||||||||||
Pre-Tax | Tax Benefit (Expense) | Net of Tax | |||||||||
Foreign currency translation adjustment | $ | (3.2 | ) | $ | — | $ | (3.2 | ) | |||
Change in net realized and unrealized gain (loss) on derivative securities | (24.6 | ) | 4.3 | (20.3 | ) | ||||||
Other comprehensive income (loss) | $ | (27.8 | ) | $ | 4.3 | $ | (23.5 | ) |
For the year ended December 31, 2015 | |||||||||||
Pre-Tax | Tax Benefit (Expense) | Net of Tax | |||||||||
Foreign currency translation adjustment | $ | (1.5 | ) | $ | — | $ | (1.5 | ) | |||
Change in net realized and unrealized gain (loss) on derivative securities | (8.2 | ) | 1.6 | (6.6 | ) | ||||||
Other comprehensive income (loss) | $ | (9.7 | ) | $ | 1.6 | $ | (8.1 | ) |
Foreign currency translation adjustment | Valuation of derivative securities | Total | ||||||||||
Balance, as of December 31, 2015 | $ | 3.8 | $ | (6.6 | ) | $ | (2.8 | ) | ||||
Other comprehensive income (loss) | (3.2 | ) | (20.3 | ) | (23.5 | ) | ||||||
Balance, as of December 31, 2016 | $ | 0.6 | (26.9 | ) | $ | (26.3 | ) | |||||
Other comprehensive income (loss) | 2.9 | 1.8 | 4.7 | |||||||||
Balance, as of December 31, 2017 | $ | 3.5 | $ | (25.1 | ) | $ | (21.6 | ) |
|
2017 | 2016 | ||||||
Beginning balance at January 1 | $ | 1.1 | $ | 4.1 | |||
Abandoned lease liability principal payments | (0.8 | ) | (1.1 | ) | |||
Adjustment to sub-lease arrangement on abandoned lease | 0.1 | 0.2 | |||||
Drawdowns on committed funding | — | (2.1 | ) | ||||
Ending balance at December 31 | $ | 0.4 | $ | 1.1 |
|
2017 | |||||||||||||||
First Quarter | Second Quarter | Third Quarter | Fourth Quarter | ||||||||||||
Revenue | $ | 196.2 | $ | 218.8 | $ | 223.2 | $ | 249.2 | |||||||
Operating income | 23.5 | 12.9 | 8.3 | 26.3 | |||||||||||
Income from continuing operations before income taxes | 28.0 | 14.6 | 14.8 | 84.6 | |||||||||||
Net income (loss) | 22.3 | 13.6 | 19.9 | (46.7 | ) | ||||||||||
Net income (loss) attributable to controlling interests | 21.4 | 12.9 | 18.7 | (48.8 | ) | ||||||||||
Basic earnings (loss) per share ($) | $ | 0.19 | $ | 0.12 | $ | 0.17 | $ | (0.45 | ) | ||||||
Diluted earnings (loss) per share ($) | $ | 0.19 | $ | 0.11 | $ | 0.17 | $ | (0.45 | ) | ||||||
Basic shares outstanding (in millions) | 113.5 | 111.3 | 109.0 | 109.0 | |||||||||||
Diluted shares outstanding (in millions) | 114.4 | 111.8 | 109.7 | 109.0 | (1) |
2016 | |||||||||||||||
First Quarter | Second Quarter | Third Quarter | Fourth Quarter | ||||||||||||
Revenue | $ | 149.6 | $ | 156.5 | $ | 170.8 | $ | 186.6 | |||||||
Operating income | 41.0 | 44.0 | 40.2 | 30.4 | |||||||||||
Income from continuing operations before income taxes | 44.0 | 48.0 | 41.7 | 27.1 | |||||||||||
Net income | 30.8 | 36.3 | 34.0 | 25.1 | |||||||||||
Net income attributable to controlling interests | 30.8 | 36.3 | 34.0 | 25.3 | |||||||||||
Basic earnings per share ($) | $ | 0.26 | $ | 0.30 | $ | 0.28 | $ | 0.21 | |||||||
Diluted earnings per share ($) | $ | 0.26 | $ | 0.30 | $ | 0.28 | $ | 0.21 | |||||||
Basic shares outstanding (in millions) | 120.0 | 119.4 | 119.3 | 118.2 | |||||||||||
Diluted shares outstanding (in millions) | 120.0 | 119.6 | 119.7 | 118.8 |
(1) | During periods of net loss, diluted shares are the same as basic shares. |
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