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Federated Hermes, Inc.’s FHI first-quarter 2025 adjusted earnings per share of $1.10 topped the Zacks Consensus Estimate of 91 cents. The bottom line grew 23.6% from the year-ago quarter.
Increased net administrative service fees and net investment advisory fees are major driving factors. The company’s total managed assets touched a record level. A rise in revenues and a decline in expenses were added advantages.
Net income (GAAP basis) of $101.1 million rose 35% from the year-ago quarter.
FHI’s Revenues & Operating Expenses
Total revenues increased 7% year over year to $423.5 million. The top line surpassed the Zacks Consensus Estimate by 0.9%.
Quarterly net investment advisory fees rose 9% year over year to $287.5 million. Our estimate for the metric was $282.9 million.
Net other service fees fell 6% year over year to $34.9 million and net administrative service fees rose 7% to $101.1 million. Our estimate for the other service fees and administrative service fees was pegged at $37.8 million and $99.9 million, respectively.
Total operating expenses declined 2% year over year to $291.8 million. Our estimate for the metric was $324 million.
FHI recorded a net non-operating income of $4.3 million, down 21% from the prior-year quarter.
Federated Hermes’ Balance Sheet Position
As of March 31, 2025, cash and other investments and total long-term debt were $541.8 million and $348.2 million compared with $641 million and $348.1 million, respectively, as of Dec. 31, 2024.
FHI’s Asset Position
As of March 31, 2025, total managed assets were at a record level of $839.8 billion, up 7.8% year over year. Our estimate for the metric was $823 billion.
FHI reported money-market assets of $637.1 billion, up 10.1% year over year. Fixed-income assets increased 3.3% to $99.5 billion. Our expectations for money-market and fixed-income assets were $615.7 billion and $100.6 billion, respectively.
Equity assets of $80.9 billion increased 0.9% from the prior-year quarter. Alternative/private market assets fell 5.1% to $19.4 billion. Our estimate for equity assets and alternative/private market assets was $82.8 billion and $20.7 billion, respectively.
Average managed assets totaled $843.2 billion, up 8.6% year over year. Our estimate was $813.2 billion.
Federated Hermes’ Capital Distribution Update
The company declared a quarterly cash dividend of 34 cents per share, marking an increase of 9.7% from the prior payout. The dividend will be paid out on May 15, 2025, to shareholders of record as of May 8.
The company repurchased 3,057,542 shares of its class B common stock for $120.1 million in the reported quarter.