Federated Hermes, Inc. (NYSE:FHI) Q3 2024 Earnings Conference Call October 25, 2024 9:00 AM ET

Company Participants

Ray Hanley - President, Federated Investors Management Company
Chris Donahue - President and Chief Executive Officer
Tom Donahue - Chief Financial Officer
Deborah Cunningham - Chief Investment Officer, Money Markets
Saker Nusseibeh - Chief Executive Officer , Federated Hermes Limited

Conference Call Participants

Patrick Davitt - Autonomous Research
Ken Worthington - JPMorgan Chase
Bill Katz - TD Cowen
Kenneth Lee - RBC Capital Markets
Dan Fannon - Jefferies
Brennan Hawken - UBS
John Dunn - Evercore ISI
Brian Bedell - Deutsche Bank Securities
Patrick Davitt - Autonomous Research

Operator

Good day, and welcome to the Federated Investors Management Company Q3 2024 Analyst Call and webcast. At this time all participants are on a listen-only mode. After management's prepared remarks, there will be a question-and-answer session.

I would now like to turn the call over to the President of Federated Investors Management Company, Ray Hanley. The floor is yours.

Ray Hanley

Morning. Welcome to the FHI Q3 call. And leading today's call will be Chris Donahue, CEO and President of Federated Hermes; and Tom Donahue, Chief Financial Officer. Joining us for the Q&A are Saker Nusseibeh, the CEO of Federated Hermes Limited; and Debbie Cunningham, the Chief Investment Officer for Money Markets.

During today's call, we may make forward-looking statements, and we want to note that Federated Hermes' actual results may be materially different than the results implied by such statements. Please review the risk disclosures in our SEC filings. No assurance can be given as to future results, and Federated Hermes assumes no duty to update any of these forward-looking statements.

Chris?

Chris Donahue

Thank you, Ray. Good morning all.

I will review Federated Hermes business performance and Tom will comment on our financial results. We ended Q3 with record assets under management of $800 billion, driven by money market assets of $593 billion, and record fixed income assets of $100 billion.

Looking first at equities. Assets increased by $5.7 billion from Q2 to $83.6 billion, due mainly to market gains of $6.5 billion, partially offset by net redemptions of $1.4 billion. The Strategic Value dividend strategies had net redemptions of $779 million in the funds in the SMA combined, whereas in Q2, that negative number was $1.9 billion.

We had Q3 positive net sales in 15 equity strategies, including MDT Mid Cap Growth, MDT Large Cap Growth, MDT All Cap Core and U.S. SMID Equity Usage Fund. We continue to have success growing our MDT fundamental quant strategies and have recently expanded the MDT product set. This year, through the end of Q3, MDT Fund and SMA strategies have had about $2.2 billion in net sales compared to a little over $400 million in net sales in '23.