Silvercrest Asset Management Group Q1 2025 Earnings Report

Silvercrest Asset Management Group EPS Results

• Actual EPS: $0.27
• Consensus EPS: $0.36
• Beat/Miss: Missed by -$0.09
• One Year Ago EPS: N/A

Silvercrest Asset Management Group Revenue Results

• Actual Revenue: $31.39 million
• Expected Revenue: $33.21 million
• Beat/Miss: Missed by -$1.82 million
• YoY Revenue Growth: N/A

Silvercrest Asset Management Group Announcement Details

• Quarter: Q1 2025
• Date: 5/8/2025
• Time: Before Market Opens
• Conference Call Date: Friday, May 9, 2025
• Conference Call Time: 8:30AM ET

Silvercrest Asset Management Group (NASDAQ:SAMG), a wealth management firm, provides financial advisory and related family office services in the United States. The company serves ultra-high net worth individuals and families, as well as their trusts; endowments; foundations; and other institutional investors. It also manages funds of funds and other investment funds. The company was founded in 2002 and is headquartered in New York, New York.

Silvercrest Asset Management Group Q1 2025 Earnings Call Transcript

Key Takeaways

• Strong organic flows of $400 M in Q1 and $1.8 B over two quarters signal robust new client growth.
• Total AUM declined to $34.3 B amid market volatility, which is expected to continue impacting short-term revenue.
• Ongoing strategic investments in talent and global expansion (Europe, Singapore, Southeast Asia, Atlanta) underpin a sturdy institutional pipeline, notably in the Global Value strategy.
• Completed a $12 M stock repurchase program and declared a $0.20 quarterly dividend, reflecting a healthy capital return policy.
• Q1 revenue rose 3.7% to $31.4 M with net income of $3.9 M, but expenses jumped 9% due to higher compensation and G&A costs, resulting in an adjusted EPS of $0.29.

Presentation

[Operator]

Good morning, and welcome to the Silvercrest Asset Management Group, Inc. Q1 twenty twenty five Earnings Conference Call. All participants will be in listen only mode. After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded.

[Operator]

Before we begin, let me remind you that during today's call, certain statements made regarding our future performance are forward looking statements. They are based on current expectations and projections, which are subject to a number of risks and uncertainties, and many factors could cause actual results to differ materially from the statements that are made. Those factors are disclosed in our filings with the SEC under the caption Risk Factors. For For all such forward looking statements, we claim the protections provided by the Litigation Reform Act of 1995. All forward looking statements made on this call are made as of the date hereof, and Silvercrest assumes no obligation to update them.

[Operator]

I would now like to turn the conference over to Rick Huff, Chairman and CEO of Silvercrest. Please go ahead.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

Good morning, everyone, and welcome to our first quarter twenty twenty five conference call for Silvercrest. We experienced strong new client organic flows of $400,000,000 during the first quarter this year. The new assets under management follow on the significant new client flows of $1,400,000,000 in the fourth quarter of twenty twenty four for a total of $1,800,000,000 over the past two quarters in new client accounts. Our first quarter's new client account flow was in itself stronger than some recent years in total. And Silvercrest strategic investments continue to promote our growth.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

The increases during the quarter bode well for future revenue and we remain highly optimistic about securing more significant organic flows over the course of 2025 as we discussed during our last call. Total AUM did decline during the quarter as a result of highly volatile markets amidst global economic and trade concerns and our discretionary AUM now stands at 22,700,000,000 as of the end of the quarter, which is flat year over year, and our total AUM was $34,300,000,000 We expect continued market volatility to affect our short term results and top line revenue. That said, we believe market and economic dislocations present meaningful opportunities for our business. Strategically, we will continue to pursue more initiatives to better highlight Silvercrest in both the institutional and wealth markets. The firm has invested in talent across the firm to drive new growth and successfully transition the business toward our next generation.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

The new business pipeline remains robust. Silvercrest will continue to monitor and adjust our interim compensation ratio to match important investments in the business as long as we have compelling opportunities to grow the firm and build our return on invested capital. We will keep you informed of our plans and the progress of these investments. We also completed a $12,000,000 stock repurchase program. We will continue to look for opportunities to return capital to or accrete shareholders, especially as we invest in the business.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

Our strong balance sheet supports ongoing capital returns as well as our growth initiatives. On May 5, the company declared a quarterly dividend of $0.20 per share of Class A common stock and that will be paid on or about June twenty of this year to stockholders of record. Scott will now cover our financial highlights and then we'll go to questions. Over to you Scott.

[Scott A. Gerard, Chief Financial Officer at Silvercrest Asset Management Group]

Thank you, Rick. So as disclosed in our earnings release for the first quarter, discretionary AUM as of March 31 was $22,700,000,000 and total AUM as of the same period was $35,300,000,000 Revenue for the quarter was $31,400,000 and reported consolidated net income for the quarter was $3,900,000 Revenue for the quarter increased year over year by $1,100,000 or 3.7%, primarily driven by market appreciation during the twelve month period. Expenses for the quarter increased year over year by $2,200,000 or 9%, primarily driven by increased compensation and benefits expense and general and administrative expenses. Compensation expense for the quarter increased year over year by $1,200,000 or 6.9%, primarily due to increases in equity based compensation and salaries and benefits expenses, primarily as a result of merit based increases, partially offset by decreases in the accrual for bonuses and the decrease in severance expense. General and administrative expenses increased by 1,000,000 or approximately 14.6%, primarily due to increases in professional fees, portfolio systems expense, recruiting costs, marketing and advertising and travel and entertainment expenses.

[Scott A. Gerard, Chief Financial Officer at Silvercrest Asset Management Group]

Reported net income attributable to Silvercrest or to Class A shareholders for the first quarter was approximately $2,500,000 or $0.26 per basic and diluted Class A share. Adjusted EBITDA, which we define as EBITDA without giving effect to equity based compensation expense and non core nonrecurring items was approximately $6,500,000 or 20.7% of revenue for the quarter. Adjusted net income, which we define as net income without giving effect to non core and non recurring items and income tax expense assuming a corporate rate of 26% was approximately $3,900,000 for the quarter or $0.29 and $0.27 per adjusted basic and diluted earnings per share respectively. Adjusted earnings per share is equal to adjusted net income divided by the actual Class A and Class B shares outstanding as of the end of the reporting period for basic adjusted EPS. And to the extent dilutive, we add unvested restricted stock units and non qualified stock options to the total shares outstanding to compute diluted adjusted EPS.

[Scott A. Gerard, Chief Financial Officer at Silvercrest Asset Management Group]

Looking quickly at the balance sheet. Total assets were approximately $159,900,000 as of March 31 compared to $194,400,000 as of the end of twenty twenty four. Cash and cash equivalents were approximately $36,300,000 as of March 31 compared to $68,600,000 at the end of twenty twenty four. Please keep in mind that cash at March 31 is net of the payout of twenty twenty four bonuses. There were no borrowings as of March 31 and total Class A stockholders' equity was approximately $80,000,000 as of the end of the first quarter of this year.

[Scott A. Gerard, Chief Financial Officer at Silvercrest Asset Management Group]

That concludes my remarks. I'll now turn the call over for Q and A.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

Thank you, Scott. We're ready to take questions. Thank you.

[Operator]

We will now begin the question and answer session. Our first question comes from Sandy Mehta with Valuate Research. Please go ahead.

[Sandy Mehta, CEO & Founder at Evaluate Research]

Yes, thank you. Good morning. Could you comment and give a little bit more color on the pipeline and what you're seeing for OCI as well as Global going forward?

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

Sure. Thanks, Sandy. Good morning. A couple of broad comments on the pipeline. With regards to OCIO and the pipeline overall, I think I mentioned last quarter, we're in an environment where the nature of searches has really changed changed a lot.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

It's no longer really an RFP game. It's about cultivating consultant relationships, putting yourself in a position where you're invited to participate in a search. And very often, you're getting a call incoming, identifying that there's interest in one of our strategies and asking us to participate. So we've been working very hard on building those relationships. We've always had very good consultant relationships, Sandy.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

Domestically, we've been expanding them internationally. And part of the investment that we've been making in the firm has been to make sure that we're making taking advantage of those opportunities, especially broad. So some of the hiring is with regards to client care and business development with those consultants. So that said, I had mentioned that I'm not going to be measuring the pipeline going forward as we had in the past traditionally. We had a great process of being able to keep shareholders up to date on an apples to apples basis, but we're beginning to feel that that's not quite credible.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

So I'm going to speak this morning more about the color of what we're feeling and happy to talk more about it. Generally speaking, I feel very, very confident about the pipeline we have in Global Value in particular. As I've said, the potential there is absolutely enormous. The number of contacts that we have globally are very strong. And I feel optimistic not only about a very large second seed investment at some point in 2025, but follow on flows into that strategy.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

We're about to complete the building of an Australian trust along with potential distribution so that we can take in other assets aside from institutional assets in that strategy. We're working on a UCITS in Europe for that and other strategies at the firm. So I'm quite optimistic. OCIO pipeline has slowed lots of activity in the pipeline, but nothing I would measure really strongly in the pipeline. I remain optimistic that those flows will pick back up.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

Currently, that strategy stands at about $1,800,000,000 at the firm. Our international value strategies have put up absolutely top tier great numbers. There's lots of good activity around that. And I feel quite strong about our ability to build those assets. So there's quite a few areas of the firm that I feel strongly about in terms of our growth looking out over the next two or three years, which should really help.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

So generally, as you would take from my introductory remarks, positive tone about what we're seeing. Now, the only negative I would point out is that, of course, we had a pullback in AUM due to volatile market, Sandy, and that overwhelmed good news. It's going to happen at our size. Nothing we can do about it. As you know, that's just part of the business.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

It's going to come up and help us sometimes. It's going to hurt So important to look at what's happening organically, and I feel very strongly that the organic picture looks very good. However, when you have market turmoil like this, as much as I like the opportunities for the company and what we can do, and we've always performed well, in those environments, happy to talk more about it. It also means that asset allocators not unlike investors generally in the high net worth space or elsewhere kind of looking around taking a pause, thinking carefully about what they're going to do. So the effect of this volatility, uncertainty about global trade and the global macro environment, it certainly can hurt us short term as it did in the first quarter.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

Obviously, markets have become more constructive since then, thankfully, although they were down, I guess, in April as well to some extent. It also affects the search environment. So we are going through a little bit of period here of hesitation that we've got to work through. But it doesn't change my medium to long term optimistic tone.

[Sandy Mehta, CEO & Founder at Evaluate Research]

And in the global area, your team is now fully built out. And how is the investment performance result? Is that still been quite satisfactory?

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

Just about fully built out. We're still working on those consultant business relationships that I told you about. And as the assets grow there, there may be some other things that we'll add. But we've added analysts, we've added business development support, we've added international trading, etcetera. So yes, we're getting there.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

I'm sorry, the second part of your question, Sandeep, was performance Yes, performance is good. Performance is outstanding, very, very good, not only against the value benchmark they measure against, but against the core benchmark, which interestingly we've been beating. So we're going into the market not just with a great win and potential big pipeline, but we're going into the market with very, very strong performance. And that performance by the way was very good despite the volatile markets. It was not just relative outperformance, we had good absolute performance in that strategy, so quite remarkable.

[Sandy Mehta, CEO & Founder at Evaluate Research]

Okay, great. And the it was good to see the buyback. So could you just update us at what price you bought back stock and where are you now in the authorization looking forward on the buyback?

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

Yes, we're done with the buyback. We authorized $12,000,000 We finished it, I believe, what are we in May? We finished it last month. We felt really good about the buyback over the past two months or so. We were able you may have noticed a really nice volume uptick in our stock.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

We were able to affect some block trades, which was part of that higher volume. We've been working closely to identify where we can buy stock back. So we felt great about that execution. We felt good about being able to do it in volume rather than being subject to just the daily volume restrictions. So we'll be looking at that and perhaps some other things going forward if we were to announce another buyback.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

With regards to buybacks in particular, there's a reason I mentioned it in my introductory remarks. I think at a time when we see so much opportunity that we have to invest in the business and admittedly, hit EBITDA and earnings the way we have, that it makes sense if we have the capital, to accrete shareholders or return capital depending what their wishes may be at the same time that we're doing that. And we're in a really nice position with a super healthy balance sheet and capital structure, where we can contemplate such a thing. I think it's a great investment on behalf of shareholders given the potential I see. And so we will be evaluating that once again since the $12,000,000 buyback is complete.

[Sandy Mehta, CEO & Founder at Evaluate Research]

All right, great. Thank you.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

You're welcome, Sandy. Thanks.

[Operator]

Our next question comes from Chris Sakai with Singular Research. Please go ahead.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

Good morning, Chris.

[Christopher Sakai, Analyst at Singular Research]

Yes, good morning. Just wanted to talk ask about the global expansion. How are things in Europe and Singapore? And can you add some color as to the AUM there?

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

Yes. The AUM is a little difficult and I'm not going to go about measuring that in our calls Chris because we have clients who may be domiciled in South Asia or in Europe, but they may have accounts here in The United States or other offshore places, yet they themselves we consider Southeast Asian or European clients. We've long had them. And that includes across both the institutional and high net worth businesses. Given the global nature of families in particular, you'd be hard pressed to say sometimes whether they're in New York, Singapore or Europe.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

So I'll give you more color instead of absolute AUM numbers because we've always had those clients. And in particular, we see strong opportunity based on the meetings we're having and in fact new clients that we've received and I'll talk about the build out. With regards to Europe, on the high net worth side, first and foremost, we've always had very significant relationships there. Netherlands, Switzerland, Germany, UK and offshore places that you would consider European. We also have new relationships as you know in Poland, which is an incredibly fast growing economy.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

I think I've mentioned before, just as an example, now wealthier per capita than The U. K. And will soon, on a per capita basis, surpass Japan, meaning this year or next year, a real dynamo in Europe. And we're excited to be kind of an early mover with some of those families. What we're changing is the fact that we would like to be able to proactively market in Europe.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

We can't do that. Right now, we can only take inbound calls and people who are expressing interest in Silvercrest reaching out to us. So we've done well with people just reaching out to us. But what we have done and we'll be spending capital on, Chris, is we've established a European entity. We are going through the process of working with the regulators so that we are licensed to proactively market and be a fully licensed participant in the European market.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

We'll be pursuing a U. K. Presence as well and have been laying the groundwork for that, frankly, for probably six years. We're very diligent and careful before we step in and commit meaningful amounts of capital. And so that process is proceeding, and we will have our European license so that we can much more proactively market, I would say, within the next up to be conservative, eight to ten months.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

But I think it will be sooner than that. It could be as soon as six months, something like that. In Southeast Asia, as you know, we're fully licensed in Singapore, the MAS. We now have people there. We will be adding people there given the opportunities that we see in the meetings that we've been having with prospective clients.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

We do have clients in Southeast Asia, including in Singapore. I just got back from a trip with potential partners and OCIO clients as well as to meet talent who can bring in AUM. So we'll keep you posted on that. We've taken a very long steady approach. Again, this has been a multiyear effort that we've been very careful about committing capital to until we know that we can succeed and we're kind of at that point where I feel we can do so.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

On the institutional side, you well know that the global value strategy, in particular, our international value strategy as well, are seeing significant interest from that side of the planet, whether that's in, we'll just call it, broader Asia or in Australia. That remains very, very promising. It's very important for us to have a presence in that time zone to help us execute that business. With regards to Europe, we've always had institutional business in Europe. We have people who distribute for us there.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

We have a good relationship, I've mentioned before, with Edmund to Rothschild. There are other partners we're working with, who will be marketing on our behalf. I told you about the usage just a moment ago that we're building on behalf of the global value strategy and other strategies. So those obviously are all European based flows and I expect a lot more to come of that given our consultant relationships.

[Christopher Sakai, Analyst at Singular Research]

Okay, great. Thanks for that answer. Just on the share buyback, can you share any color on potentially a new buyback and the amount there and how much that would be?

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

I think I've given comments that we're very seriously looking at it, Chris, and why we would want to execute it as we especially as we make investments that at least for the meantime have a higher compensation ratio for the firm and therefore hit our earnings and EBITDA. We're very conscious of that. We feel great about what we're doing. We forecast what we were doing explicitly for a long time before we did it. And I think we've strategically laid out our plan.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

I'd like to return capital to our shareholders or accrete them while we do this, so that they can benefit at what I think is a good entry point as we see this growth occur just as I've announced these new accounts that have come in the past two quarters. But we will assess the amount and when that may occur. I'm not ready to make announcements along those lines at this time.

[Christopher Sakai, Analyst at Singular Research]

Okay, great. Thanks for the answers.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

Thank you, Chris. Appreciate the questions.

[Operator]

Our next question comes from Christopher Marinac with Janney Montgomery Scott. Go ahead.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

Christopher. Good morning.

[Christopher Marinac, Director of Research at Janney Montgomery Scott]

Hey, good morning. Thanks for hosting us this morning. Rick and Chad, I want to drill down on expenses and kind of the timing of sort of getting additional revenue versus expenses?

[Christopher Marinac, Director of Research at Janney Montgomery Scott]

It's the old fashioned operating leverage question. I know you can't run

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

this quarter to super hard give clarity to, to be honest. But yes, okay, go ahead.

[Christopher Marinac, Director of Research at Janney Montgomery Scott]

But the big picture is still to kind of get that positive crank as you think about it year to year and perhaps we should think about this year over year and less quarter to quarter. But I'm just curious how you think about that in the big picture. It's less about next quarter and more about kind of how you look at running the business. So I know it's a long term focus and goal for you.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

Yes, it really is. And I think the last call I talked about working through this through the end of twenty twenty six. And part of the reason is this, let's tear apart the and obviously this is a much longer play than that. But you're asking about the operating leverage.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

I get it. I think we're going to grow into it. But let's break it apart. First of all, we have the investments we've made in the global value equity team. We've built out a lot about out on that team, but there's a bit more to come.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

The pipeline there is huge, absolutely enormous. I do think, as I've mentioned across that, the international value team, which is separate from the global value team, as you know, and our other growth and value equity capabilities are hurt right now a bit by the global macro environment and trade environment, just as the markets came down. So the search environment was slowing a bit. But I feel very strongly that the opportunity is significant. That team on its own is going to grow year over year definitely through those costs and start giving us leverage.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

And of course, it's a nicely leverageable business, which will benefit the entire firm. So I feel strongly about that. These flows can be so big that I hesitate to give you a forecast on what that can really mean for the firm. Timing is everything, of course. And there's a lot of variability when you're talking about large flows like that. So the best I can say is that I'm optimistic. And I would hesitate to say more, but very bright.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

Then we have the investments in Southeast Asia, which has been ongoing and the new investments we're making in Europe. We're also, as you know, building out organic growth in Atlanta, Georgia. So there are people we're hiring there and have been. There are capital expenditures with regards to those locations. They hang together with the global impression we're making with our strategies.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

We've always done things where the institutional business is applicable and related to the high net worth business. I'm not building a firm where you're doing something disparate over there and you've got strategy B that doesn't hang together with attracting very significant large families. Those by the nature of the high net worth business are slower growing. The advantage there, of course, Christopher, is that they are very, very sticky assets and a very different business once you get that crank going. And we have a history of being able to organically grow that business, which is incredibly difficult.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

So that's going to take a bit more time as we lean into it. But in our experience, when you have the kind of environment we do, when you have the quality of the firm that we do, and the nature of what we can do on an institutional level for these families that help Silvercrest stand apart, we succeed. And that requires a bit more patience. So the ultimate leverage, obviously, is going to be on the institutional side and the faster growth is going to be on that side, not surprisingly, adds more leverage to the business, can grow faster. The other investments we make are going to be slower and stickier.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

It's very hard to say how that plays out, but that's going to be a longer term game for sure. So I do expect to see increasing margins year over year, especially as markets even out at some point as we could get to some trade deals. That should add operating leverages. I would love to see the pendulum start swinging back towards our normalized EBITDA margins. It's certainly my expectation that year over year we will make progress.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

We're not going to be back to normal, however, in the high 20s or low 30s unless there were really, really big flows and have supportive markets at the same time. So therefore, I'm still looking out at least through the end of twenty twenty six and we'll keep folks updated. But look, I feel very good. We've seen almost $2,000,000,000 in net new client accounts over the past two quarters. We were only hurt by the declining markets in the first quarter.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

The closed accounts were very attenuated. And so with a bit more supportive markets and some more flows, that's some pretty significant progress already, especially if I were to pause investments. So I feel good year over year, feel great as we look through 2026.

[Christopher Marinac, Director of Research at Janney Montgomery Scott]

Great. At the end of day

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

required more color than firm stats. I can't predict the future fully.

[Christopher Marinac, Director of Research at Janney Montgomery Scott]

Yes. Understand. And I guess at the end of the day, as long as I've covered you, we see the AUM come in and then your ability to retain that has been very good. Obviously, markets move quarter to quarter, but that's the point, going to bring that AUM in and the revenue follows.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

I will also mention, we might take a bit of a pause. And I'm not saying that I already know anything. We were only a month into this quarter, but we may take a pause in the second quarter. That's okay. And the reason I say that is, clearly, the search environment is affected by the current global macroeconomic environment.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

Okay, let's look through that. So what? This is a long term business, number one. Number two, there's always a potential for some tax outflows during the second quarter. There are two tax payments that are due that's always going to be a bit of a headwind even with supportive markets. We see that every year. Last year was again a very, very good capital gains year for a lot of our clients. I don't know how that's going to shake out, but it's worth keeping in mind. And then we need those supportive markets as well.

[Christopher Marinac, Director of Research at Janney Montgomery Scott]

Great. And last question for me. There's been a lot of macro conversation in the last five, six weeks about international investors pulling capital from The U. S. And going back home.

[Christopher Marinac, Director of Research at Janney Montgomery Scott]

You see of that? And is that an issue for Silvercrest at all? Or can you work through that given some of the other global strategies that you're now employing?

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

We can work through that. First of all, the vast majority of our assets are U. S. Based. So, not a significant issue for us.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

Secondly, we do have a global strategy. We have an emerging market strategy. We have an international strategy. Those are, by definition, purchasing companies in around the world. And from what I see, there's tons of capital that needs to go into those strategies.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

And whether it's local currency or U. S, I don't see that changing. The United States is the world's largest economy. When we buy things from the rest of the world, the rest of the world ends up with dollars. Those dollars have to go somewhere.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

And I see that significantly affecting us or changing the environment. I just got back from Asia. I didn't see any personally as a subjective color. There may be talk and at the margins there may be some of those moves, but look, it's a big world. We're a small company.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

There's a lot of opportunity and we were meeting with people because they were interested. So, don't think that's a really significant issue for us at this time.

[Christopher Marinac, Director of Research at Janney Montgomery Scott]

Great, Rick. Thank you for the background. I appreciate all the information today.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

You're welcome, Christopher. Thanks for the questions.

[Operator]

This concludes our question and answer session. I would like to turn the conference back over to Rick Huff for any closing remarks.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

Great. Thank you. I appreciate everyone joining us for this first quarter of twenty twenty five call. The good questions also greatly appreciate our shareholders who have been encouraging with regards to our long term strategy and the investments we're making. I just want to make it clear to anyone.

[Richard R. Hough III, Chairman, CEO & President at Silvercrest Asset Management Group]

Scott and I are always available to take questions, talk about what we're up to. And we're pretty excited over the next, call it, year and certainly very excited for beyond that given what we're building at the firm. Thanks again and look forward to talking to everyone soon.

[Operator]

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

Participants

Executives

• Richard R. Hough III, Chairman, CEO & President
• Scott A. Gerard, Chief Financial Officer

Analysts

• Sandy Mehta, CEO & Founder at Evaluate Research
• Christopher Sakai, Analyst at Singular Research
• Christopher Marinac, Director of Research at Janney Montgomery Scott