GCM Grosvenor Boosts Share Repurchase Authorization Amid Strong Q2 2023 Results

Discover GCM Grosvenor's Strong Q2 2023 Results: Share Repurchase Authorization Boosted Amid Impressive Growth and Financial Performance


GCM Grosvenor (Nasdaq: GCMG), a global leader in alternative asset management solutions, has announced its impressive second-quarter results for 2023. The company's Chairman and CEO, Michael Sacks, expressed satisfaction with the robust performance, highlighting a 50% increase in fundraising compared to the previous quarter, totaling $1.5 billion. Notably, GCM Grosvenor has demonstrated its confidence in continued growth by raising its share repurchase authorization to $115 million.

Assets Under Management on the Rise

GCM Grosvenor's Assets Under Management (AUM) experienced a notable 7% surge from June 30, 2022, reaching $76.0 billion as of June 30, 2023. Fee-Paying Assets Under Management (FPAUM) also witnessed a 5% rise over the same period, totaling $60.6 billion. The Private Markets FPAUM saw a remarkable 12% increase, further underscoring the company's diversified investment approach. However, Absolute Return Strategies FPAUM observed a 5% decline during the same timeframe.

Steady Revenue Growth

The company reported a 3% increase in revenue for the quarter ending June 30, 2023, compared to the same period in the prior year. The revenue totaled $107.6 million, reflecting GCM Grosvenor's resilience in an ever-changing market landscape. Fee-Related Revenue stood at $90.8 million, maintaining consistency with the prior year's figures. Private Markets Management Fees experienced a 5% boost, reaching $53.0 million. In contrast, Absolute Return Strategies Management Fees encountered an 8% decrease, settling at $36.8 million.

Financial Performance Highlights

While GAAP Net Income Attributable to GCM Grosvenor Inc. witnessed a 36% decline from the prior year's Q2, reaching $4.8 million, the company's Adjusted Net Income showcased a 3% increase, reaching $22.7 million. Fee-Related Earnings, at $32.8 million, remained on par with the prior year's Q2. Adjusted EBITDA also demonstrated positive growth, increasing by 2% from the previous year's Q2, totaling $36.0 million.

Incentive Fees and Dividends

GCM Grosvenor's involvement in unrealized carried interest amounted to an impressive $361.2 million of net asset value as of June 30, 2023. Run-rate annual performance fees stood at $28.0 million as of the same date, highlighting the company's potential for generating performance-based revenue. Additionally, the company's Board of Directors approved a dividend of $0.11 per share, scheduled to be paid to shareholders on September 15, 2023.

Share Repurchase Plan Expansion

Notably, GCM Grosvenor has made a significant move in its capital allocation strategy. During the second quarter, the company repurchased $1.1 million of Class A common stock, with $21.6 million remaining in its approved share and warrant repurchase plan. In an exciting development, the company's Board of Directors has authorized an increase in its existing share repurchase plan by $25 million, taking the total authorization to $115 million.

GCM Grosvenor's second-quarter results reflect a strong performance across various metrics, including increased fundraising, steady revenue growth, and expansion of the share repurchase plan. These developments underscore the company's commitment to growth and value creation for its shareholders.

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