StepStone Group LP (NASDAQ:STEP) Q1 2025 Earnings Conference Call August 8, 2024 5:00 PM ET

Company Participants

Seth Weiss – Vice President-Investor Relations
Scott Hart – Chief Executive Officer
Jason Ment – President and Co-Chief Operating Officer
Mike McCabe – Head-Strategy
David Park – Chief Financial Officer

Conference Call Participants

Kenneth Worthington – JPMorgan
Michael Cyprys – Morgan Stanley
Adam Beatty – UBS

Operator

Good day, and thank you for standing by. Welcome to the First Fiscal Quarter 2025 StepStone Group, Inc. Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised, today’s conference is being recorded.

I would now like to hand the conference over to your speaker today, Seth Weiss, Vice President of Investor Relations. Please go ahead.

Seth Weiss

Thank you, and good afternoon. Joining me on today’s call are Scott Hart, Chief Executive Officer; Jason Ment, President and Co-Chief Operating Officer; Mike McCabe, Head of Strategy; and David Park, 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. 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 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 periodic filings. 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.

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 first quarter of fiscal 2025. Beginning with Slide 3, we reported GAAP net income of $48.0 million. GAAP net income attributable to StepStone Group Incorporated was $13.3 million or $0.20 per share.

Moving to Slide 5. We generated fee-related earnings of $71.7 million, up 61% from the prior year quarter, and we generated an FRE margin of 40%. The quarter reflected retroactive fees primarily from our private equity secondaries fund, special situation real estate secondaries fund and infrastructure co-investment fund. Retroactive fees contributed $19.1 million to revenue, which compares to retroactive fees of $2.8 million in the first quarter of fiscal 2024.