Good morning, and welcome to Acadian Asset Management Inc.' s conference call to discuss our results for the first quarter ended March 31st, 2026.

Before we begin the presentation, please note that we may make forward-looking statements about our business and financial performance. Each forward-looking statement is subject to risks and uncertainties that could cause actual results to differ materially from those projected.

Additional information regarding these risks and uncertainties appears in our SEC filings, including the Form 8-K filed today containing the earnings release and our 2025 Form 10-K. Any forward-looking statements that we make on this call are based on assumptions as of today, and we undertake no obligation to update them as a result of new information or future events.

We may also reference certain non-GAAP financial measures. Information about any non-GAAP measures referenced, including a reconciliation of those measures to GAAP measures, can be found on our website, along with the slides that we will use as part of today's discussion.

Finally, nothing herein shall be deemed to be an offer or solicitation to buy any investment products. Kelly Young, our President and Chief Executive Officer, will lead the call.

Now, I'm pleased to turn the call over to Kelly.

Thanks, Melody. Good morning, everyone, and thanks for joining us today.

I'm thrilled to share our exceptional Q1 2026 results with you. Our assets under management and profitability continue to reach new heights, with strong recent growth underscoring sustained momentum in our business and disciplined execution of our strategic plan.

We started 2026 by delivering outstanding results across all metrics. Our U.S.

GAAP net income attributable to controlling interests was up 21%, and EPS was up 26% compared to the prior year, driven by increased management fees and partially offset by non-cash expenses representing changes in the value of Acadian LLC equity and profit interests. ENI was up 85% to $37.6 million, driven by revenue growth, and our ENI diluted EPS of $1.05 was up 94%.

Our adjusted EBITDA was up 76%, driven by increase in management fees. We realized $21.4 billion of positive net flows in Q1 2026, 12% of beginning AUM, a new quarterly record, driven by enhanced, extensions, and global equity strategies.

Finally, AUM grew 61% from Q1 of '25 to $195.7 billion as of March 31st, 2026, marking another record high for Acadian. Turning to slide 3, Acadian's investment performance track record remains strong.

Five major implementations comprise the majority of our assets. As of March 31st, 2026, Global Equity, Emerging Markets Equity, Non-U.S.

Equity, Small Cap Equity, and Enhanced Equity have 100% of assets outperforming benchmarks across 3-, 5-, and 10-year periods, with only one exception. Global equity markets experienced volatility amid a complex macroeconomic backdrop in Q1 of '26.

U.S. equities declined more than non-U.S.

equities, while the dollar strengthened. Despite the market uncertainty, our disciplined, systematic approach stayed the course and generated consistent alpha for our clients.

Acadian's short-term performance track record continued to improve in Q1 2026 after a challenged 2025. We remain confident that we are well positioned given our 40 years of experience through various market cycles and macro forces.

Slide 4 details how our investment process has generated meaningful long-term alpha for our clients. Our revenue-weighted 5-year annualized return in excess of benchmark was plus 4.1% as of the end of Q1 2026 on a consolidated firm-wide basis.

Our asset-weighted 5-year annualized return in excess of benchmark was 3.4% as of the end of Q1. By revenue weight, 96% of Acadian's strategies outperformed their respective benchmarks across 3-, 5-, and 10-year periods as of March 31st, 2026.

By asset weight, 92% of Acadian's strategies outperformed their respective benchmarks across 3-, 5-, and 10-year periods. The next slide highlights our sustained momentum in net flows.

We realized positive net flows of $21.4 billion in Q1 of '26, representing 12% of beginning AUM, achieving a new quarterly record high. Gross inflows included a significant enhanced mandate from a premier U.K.

wealth manager. This mandate expanded our non-U.S.

domiciled client base, as well as our presence in the wealth channel. Excluding this large enhanced mandate, the remainder of the net inflows were again diverse across products and client types, with extensions and global equity also generating strong NCCF.

We've now generated nine consecutive quarters of positive net flows. We continue to focus on renewing our pipeline, which remains very healthy and active after the funding of a number of significant client wins in Q1 of '26.

I'm now going to turn it over to our CFO, Scott Hynes, to provide you with more detail on our financial performance this quarter and an update on capital allocation.

Thanks, Kelly. Turning to slide 7, our key GAAP and ENI performance metrics are summarized here on a quarterly basis.

As previously noted, we manage the business using ENI metrics, which better reflect our underlying operating performance. You can find complete GAAP to ENI reconciliations in the appendix.

Let me now turn to our core business results. Starting on slide 8, total ENI revenue of $165 million increased 40% from Q1 '25, primarily due to recurring management fee growth and an increase in performance fees.

Q1 '26 management fees of $159 million increased 41% from Q1 '25, reflecting a 57% increase in average AUM, driven by strong positive NCCFs and market appreciation over the last 12 months. Stepping back, with average AUM of $190 billion in the first quarter, we have materially expanded our recurring management fee base and significantly strengthened Acadian's earnings power.

Moving to slide 9, in Q1 '26, ENI operating expenses increased 13%, primarily driven by higher sales-based compensation and portfolio-related costs due to AUM growth, as well as general and administrative costs, including continued investment in IT and infrastructure. Our ENI operating margin expanded 978 basis points to 38.1% from 28.3% in Q1 '25, driven by increased ENI management fees, while our operating expense ratio fell 10 percentage points year-over-year to 38.4%, reflecting the impact of improved operating leverage.

Q1 '26 variable compensation increased 35% year-on-year, primarily driven by higher profit before variable compensation. Our Q1 '26 variable compensation ratio decreased to 39.4% from 47.6% in Q1 '25.

Assuming revenue mix and levels similar to Q1 '26, contractual allocations would imply a full-year 2026 variable compensation ratio of approximately 40% to 43%. Turning to slide 10 on capital resources and our strong balance sheet, as of March 31st, 2026, we had $129 million of cash and $97 million of seed investments on the balance sheet, with a $200 million balance on our term loan credit facility and an $85 million balance on our revolving credit facility.

Note, the revolver balance reflects first quarter seasonal needs and is expected to be fully paid down by year-end. Our Q1 '26 gross debt to adjusted EBITDA ratio was 1.3 times, and our net debt to adjusted EBITDA ratio was 0.7 times.

Note that while both these measures are slightly higher quarter-on-quarter, reflecting our typical first quarter revolver draw, they are down over half a turn year-on-year, driven by lower gross debt and higher adjusted EBITDA. Moving to slide 11, we have a track record of creating significant value through share buybacks in recent years.

Outstanding diluted shares have decreased 58% from 86 million in 4Q '19 to 35.8 million shares in Q1 '26. Over the same period, $1.4 billion in excess capital was returned to stockholders through share buybacks and dividends.

During Q1 '26, we repurchased just under 100,000 shares, or $4.7 million of stock, at a volume-weighted average price of $49.77. Acadian's board has declared an interim dividend of 10 cents per share to be paid on June 26th, 2026 to shareholders of record as of the close of business on June 12th, 2026.

Going forward, we expect to continue generating strong free cash flow and returning excess capital to shareholders through dividends and share repurchases over time. We look forward to discussing our broader capital allocation framework in more detail at our upcoming investor forum.

I'll now turn the call back over to Kelly.

Before moving to Q&A, let me recap some key points on slide 12. Acadian is competitively positioned as the only pure play publicly traded systematic manager with a 40-year track record and competitive edge in systematic investing.

Our investment performance track record remained strong this quarter, with more than 96% of strategies by revenue outperforming over 3-, 5-, and 10-year periods. Gross momentum continued apace in Q1 of '26, with record net inflows of $21.4 billion for Q1 2026, 12% of beginning AUM, reflecting nine consecutive quarters of positive net flows and reaching AUM of $195.7 billion, up 61% from Q1 '25, the highest in the firm's history.

Q1 '26 financial results included record management fees of $159 million, up 41% from Q1 '25, ENI EPS of $1.05, up 94% from Q1 of '25, and operating margin expansion to 38.1%, up nearly 10 percentage points from 28.3% in Q1 of '25. Finally, capital management remained a focus in the quarter, as we strengthened our balance sheet with conservative leverage ratios, continued to invest in organic growth, and returned excess capital to shareholders.

Pleased with our first quarter results, we remain focused on disciplined execution and look forward to discussing our strategic priorities more at our first Acadian Investor Forum on May 19th. This concludes my prepared remarks.

Hey, good morning, and thanks for taking my question. Just one on the institutional pipeline, wondering if you could just provide a little bit more color in terms of what you're seeing within there.

What's the composition of strategies between enhanced, and looks like as if you're gaining some traction on the extension side there as well. Thanks.

Hi Ken. Nice to speak to you again.

The pipeline looks very healthy across a number of different strategies and client domiciles. As you'll see, the enhanced story continued to dominate Q1 of this year, but once we ex out that very large win from St.

James's Place, which was about $16 billion, it was still an incredibly positive quarter with north of $4 billion in net flows over and above that. That was very granular this quarter.

About half of that remaining $4 billion were coming from our extensions strategies. We've certainly seen a pick up in momentum and interest in extensions, and that forms a very solid part of the pipeline.

As I say, enhanced this quarter the dominant theme, and that continues to show up very helpfully in our pipeline. It is granular.

Global, emerging markets, international equities, all of those sort of very broad core strategies that Acadian is well known for and our flagship strategies are continuing to see a lot of interest and a lot of momentum. The pipeline continues to be diversified.

The team continues to do a great job in replenishing it despite that very large NCCF number for Q1. Again, looks very robust as we go into the second part of 2026.

Right. Just one follow-up, if I may.

Average fee rates didn't change much quarter-on-quarter despite the sizable mandate inclusion there. Wondering whether there's a little bit of timing there in terms of impact, wondering whether we should see some impact on average fee rates going forward given the mix shift there.

Thanks.

Hey Ken, it's Scott. Thanks for joining us.

I think the short answer to your question is yes, a little bit. Again, as Kelly suggested, very proud of the large win from St.

James's this quarter. It did fund later in the quarter, for all intents and purposes, we haven't yet realized the full run-rate impact of that.

As the fee rate is subject to a whole bunch of things out of our control. It is an output of market conditions and where client demand comes in next quarter.

As Kelly already said, we have things that, particularly when you think about extensions or the likes, that can go above the current 34 basis point fee rate generally. All else equal, if nothing else were to change, I do think we're staring at a little bit of headwind in the next quarter as we realize the full run-rate impact of this continued mix shift to enhanced.

Gotcha. One just final one for me.

Seed capital investments there, any particular outlook in terms of whether you could see that increasing over the near term? Just a little bit more color around that.

Thanks.

Sure. Again, I think we appreciate that the board and others have been very supportive with a very active seed program, as Ken.

The majority of our seed has been deployed into our systematic credit strategies, and we remain very excited about the trajectory there and the performance track record that the team are building. I think, as we have three strategies launched today.

Each of those are a little short of their 3-year track record. We will hit three years in November for U.S.

high yield, closely followed by the remaining two strategies early next year. I think we'll look to have that seed remain in place for some time, although we are building momentum and the pipeline there for systematic, and as I say, we're very excited to hit the 3-year anniversaries considering where performance is trending.

Beyond that, we have again, as had an active seed program. We are looking at some other new strategies, ensuring that we've got vehicles in place that meet the needs of our more diversified client base today, whether that be in the institutional or wealth space.

I don't think that the overall needs are going to increase significantly from here, perhaps on the margins, but underneath that number, there has been, I think quite an active recycling program as we've launched extensions, our dynamics extension strategies, and as we see those gain traction with clients, and we're able to redeploy that capital to other new areas of growth.

I would just add, Ken, on to that, Kelly hit the recycling. We just feel like we're very well positioned in this regard.

It's obviously very important to the business. As Kelly suggests, as the team continues to innovate, and we as a finance team think about supporting them with just under $130 million of balance sheet cash today, and this dynamic where we've been able to often just recycle what we've already put in, again, we just feel like we're really well positioned to support the businesses that continues to innovate and meet client demand.

Great, very helpful there. Thanks again.

Thank you.

Thank you.

Thank you. Wanted to ask about kind of just given where we are, the renewed demand for particularly the non-U.S.

exposure, but also the managed vol strategy, which I think would benefit from the current environment. Yeah.

Hi, John. Nice to speak to you again.

Yes, non-U.S. has certainly been a feature that I know we've talked about on these calls over the last 12 or 15 months or so.

We're continuing to see a lot of interest in international strategies broadly. As Acadian has a very strong, compelling track record there dating back many decades, and certainly, we continue to see a lot of momentum there, particularly from U.S.-based clients.

Managed vol was a slight headwind in Q1, but we certainly have seen outflows there taper off quite dramatically versus two to three years ago. I think, certainly, these types of strategies, when we've seen what has been a challenging macro backdrop in Q1 with the tensions and conflict in the Middle East, certainly that's where strategies like managed vol come into their own.

I think we have a number of longstanding clients in those strategies who have seen the real value of them at inflection points like that. Q1 wasn't an asset-gathering quarter for managed vol, but a very slight headwind.

Again, I'd say that those outflows have certainly tapered off, and I think it's at the forefront of clients' minds with the current environment that we're in where managed vol may play a role in their strategic asset allocation.

Got it. Then maybe just if you could opine on kind of the dynamic and potential for systematic taking potentially from private strategies and then also from the passive side?

Sure. Yeah.

I think we see this in the industry numbers, we see it anecdotally, and as we talk to clients every day, that systematic is clearly a winner in the active equity space. I think when we talk about sort of private investments, particularly perhaps private credit, I think, as I said, we're excited about what we've built on the systematic credit side.

We do think there's opportunities there as investors continue to stare at their private investments, their private credit investments, is there a place for something more like a public systematic credit? I think, again, we feel that as we build that track record, and the story we think is compelling, I think the transparency, the liquidity will be compelling to investors, certainly on that side.

John, I would add,

it's Scott here.

Oh, John, I was just going to go ahead and add, I think we may have lost you, but we're looking at an investor forum that we're excited about on May 19th. As Kelly suggests, this all adds up.

As we think about our addressable market, we've been spending a lot of time as a management team thinking about it. It's rather large, it's diversified, and I think we'll look forward to talking about it in a more granular way on May 19th.

Look forward to it. Thank you.

Thank you.

Hi, good morning. Thanks for taking the question.

More of a big-picture question with all the advances in data science and AI models entering the fintech era. Just curious how you see that impacting potentially the competitive landscape for systematic investing?

What are the risks, if any, of these quickly advancing models that could democratize access to folks creating systematic strategies, emerging new competitors? Just curious how you see that all evolving.

Sure. Hi, Michael.

Thanks for the question. We don't view AI as a strategic threat to the business model today.

Systematic investing has relied on data, technology, increasingly sophisticated research tools throughout our history and throughout the time of this industry. We view AI very much, I think, as an extension of that evolution rather than a disruption to it.

From our side, again, machine learning, AI, this has been within Acadian's DNA from very many years. We're using AI to enhance our research, development, our operating workflows, but I think it's key that you keep human judgment and your investment discipline and risk controls at the center of that process.

From my point of view, I think we all believe that firms that adopt these tools effectively are going to strengthen their competitive position. I think we're at the forefront of that, and we intend to remain on the right side of that equation.

Then

could you just maybe elaborate on how you're using the newer generative AI tools, as well as maybe even agentic AI tools across the firm today, and how you're thinking about the opportunities out there?

Sure. Again, I think, as you said, the landscape's changing very quickly.

We think there's huge opportunities there. As I say, AI isn't obviously new to us, but the current generation of tools is really allowing us, I guess, to apply it more broadly across the firm.

Our investments today are going to be focused on a couple of key areas. One of those is improving productivity, and that's really through kind of enterprise AI tools, but also enhancing software development through AI-assisted coding, building selected AI-enabled services that's going to support our research.

Certainly, again, we have people that are very comfortable, have many years experience in computer science and machine learning, and we're encouraging people within that kind of building that strong foundation, showing guardrails and from a security standpoint, but encouraging people to experiment across different software and platforms.

Michael, it's Scott. I'd just jump in again real quick on this.

To be clear, we're proud of how we're scaling, and obviously, it's another great quarter. We generated really meaningful positive operating leverage.

If you look at expenses and where we are growing, and you strip out the sales-based commissions, we're about 8% up OpEx, the ENI OpEx year-on-year. A lot of that is the technology and the platform and the tools that Kelly's referencing, right?

That is a driver. As she suggests, our technology platform has long been thought of as part of the moat around the business, and we want to expand it.

I think this is an opportunity to do so. That's a very long way of saying this is an area where we're investing and excited about it.

Great. Then just a final question on capital allocation.

I was just hoping maybe you could unpack how you're thinking about the dividend here, specifically the growth rate or payout ratio that you're targeting, and then more broadly on buybacks and other uses, how you're approaching that just given the significant free cash flow generation of the business.

Yeah. As you suggest, for all intents and purposes, the ENI that we disclose is a good proxy for the free cash flow that we're seeing.

Very strong. We think we're very well positioned.

This quarter, we remained dynamic. As I've suggested before, we do have a capital management framework and it starts with the organic investments.

We already talked about seed capital. That sort of thing would be top of the list.

I would also include, as we expand further down the list, these organic investments and things like AI, and then we get to a dividend and then a return of excess capital via buybacks. I've used the word athletic.

That continues to be the case. We look at it every quarter, and as we look about organic needs and balancing those about returning excess capital, that's how we make the decision framework.

Everything has an IRR frame. We do, of course, pencil out returns on any of the investments we're making.

That informs us, and this quarter we landed the way we landed. I would not say, Michael, since you mentioned it, a payout ratio, we do not manage to a payout ratio.

I think it's much more dynamic than that. I know that's not an easy answer, particularly for modeling purposes, but I do think it's dynamic each quarter given all the dynamics I just discussed and the various priorities.

On the dividend, I would add, as we recently moved from a penny to 10 cents. Very proud of that.

That is reflective of the new size, right, that we've really realized, the confidence we have in that larger recurring management fee base, and enhanced profitability. I think we stepped into this on last quarter's call, I would not think about us continuing to try to revisit that dividend every quarter.

We're sensitive to it. We monitor it, but it's not something that I would think of as us revisiting in a meaningful way the dividend every quarter.

If we get to a different place, another step up in profitability, we would revisit that. I think there's no philosophy change here, and that when we think of a return of excess capital, I would continue to think the direction of travel would still be more geared towards share repurchases versus a dividend.

Again, these things evolve. Hopefully that's of help.

Great. Thanks so much.

Thank you everyone for joining us today, and we look forward to seeing many of you at our investor forum in Boston on May 19th. Have a great day.