StepStone Group Inc. (NASDAQ:STEP) Q3 2023 Earnings Conference Call February 9, 2023 5:00 PM ET

Company Participants

Seth Weiss - Head, Investor Relations

Scott Hart - Chief Executive Officer

Jason Ment - President and Co-Chief Operating Officer

Mike McCabe - Head, Strategy

Johnny Randel - Chief Financial Officer

Conference Call Participants

Ken Worthington - JPMorgan

Adam Beatty - UBS

Ben Budish - Barclays

Michael Cyprys - Morgan Stanley

Alex Blostein - Goldman Sachs

John Dunn - Evercore

Operator

Greetings and welcome to StepStone Fiscal Third Quarter 2023 Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Seth Weiss, Head of Investor Relations. Thank you, sir. You may begin.

Seth Weiss

Thank you. Joining me on the call today are Scott Hart, Chief Executive Officer; Jason Ment, President and Co-Chief Operating Officer; Mike McCabe, Head of Strategy; and Johnny Randel, Chief Financial Officer. During our prepared remarks, we will be referring to a presentation which is available on our Investor Relations website at shareholders.stepstonegroup.com.

Before we begin, I’d like to remind everyone that this conference call as well as the presentation contains certain forward-looking statements regarding the company’s expected operating and financial performance for future periods and our plans for future dividends. Forward-looking statements reflect management’s current plans, estimates and expectations and are inherently uncertain and are subject to various risks, uncertainties and assumptions.

Actual results for future periods and actual dividends declared may differ materially from those expressed or implied by these forward-looking statements due to changes in circumstances or a number of risks or other factors that are described in the Risk Factors section of StepStone’s most recent 10-K. These forward-looking statements are made only as of today, and except as required, we undertake no obligation to update or revise any of them. In addition, today’s presentation contains references to non-GAAP financial measures. Reconciliations to the most directly comparable GAAP financial measures are included in our earnings release, our presentation and our filings with the SEC.

Turning to our financial results for the third quarter of fiscal 2023, we reported a GAAP net loss of $13.6 million. The GAAP net loss attributable to StepStone Group, Inc. was $6.9 million. We generated fee-related earnings of $39.0 million, adjusted net income of $31.2 million, and adjusted net income per share of $0.27. The quarter had no impact from retroactive fees. This compares to retroactive fees in the third quarter of fiscal 2022 that contributed $1.2 million to revenue and $1.1 million to fee-related earnings and pre-tax adjusted net income.