Westwood Holdings Group Inc 8-K, filed Oct 27, 2021

Westwood Holdings Group Inc (WHG)

8-K 2021-10-27 For: 2021-10-26

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Added on April 10, 2026

About this 8-K

Westwood Holdings Group Inc filed this 8-K on October 27, 2021, reporting on events of October 26, 2021.

Items reported

Item 7.01: Regulation FD disclosure
Item 9.01: Financial statements and exhibits

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Title of Each Class	Trading Symbol(s)	Name of Each Exchange on Which Registered
Common stock, par value $0.01 per share	WHG	New York Stock Exchange


			WESTWOOD HOLDINGS GROUP, INC.


By:			/s/ Murray Forbes III
			Murray Forbes III
			Chief Financial Officer and Treasurer


	Three Months Ended
	September 30, 2021		June 30, 2021		September 30, 2020
REVENUES:
Advisory fees:
Asset-based	$	12,011	$	11,385	$	8,847
Performance-based	—		—		713
Trust fees	5,952		6,216		5,787
Trust performance-based fees	—		—		37
Other, net	(103)		(117)		70
Total revenues	17,860		17,484		15,454
EXPENSES:
Employee compensation and benefits	10,268		10,237		9,515
Sales and marketing	292		370		215
Westwood mutual funds	814		368		421
Information technology	1,937		2,261		2,158
Professional services	726		1,428		1,033
General and administrative	1,779		2,042		2,333
Impairment expense	—		—		3,403
Loss on foreign currency transactions	—		—		419
Total expenses	15,816		16,706		19,497
Net operating income (loss)	2,044		778		(4,043)
Realized gains on private investments	—		46		—
Net change in unrealized appreciation (depreciation) on private investments	(13)		215		(73)
Investment income	131		235		(43)
Other income	198		142		34
Foreign currency translation adjustments to net income (loss) upon liquidation of a foreign subsidiary	—		—		(4,193)
Income (loss) before income taxes	2,360		1,416		(8,318)
Income tax expense	481		446		1,971
Net income (loss)	$	1,879	$	970	$	(10,289)
Other comprehensive income (loss):
Foreign currency translation adjustments	—		—		621
Reclassification of cumulative foreign currency translation adjustments to net income upon liquidation of a foreign subsidiary	—		—		4,193
Total comprehensive income (loss)	$	1,879	$	970	$	(5,475)

Earnings (loss) per share:
Basic	$	0.24	$	0.12	$	(1.31)
Diluted	$	0.24	$	0.12	$	(1.31)

Weighted average shares outstanding:
Basic	7,887,259		7,884,774		7,829,478
Diluted	7,956,081		7,928,106		7,829,478

Economic Earnings (Loss)	$	3,706	$	2,810	$	(1,711)
Economic EPS	$	0.47	$	0.35	$	(0.22)

Dividends declared per share	$	2.60	$	0.10	$	0.00


	Nine Months Ended
	September 30, 2021		September 30, 2020
REVENUES:
Advisory fees:
Asset-based	$	33,846	$	29,277
Performance-based	1,959		1,408
Trust fees	18,233		17,395
Trust performance-based fees	—		77
Other, net	(375)		(159)
Total revenues	53,663		47,998
EXPENSES:
Employee compensation and benefits	32,053		32,970
Sales and marketing	892		946
Westwood mutual funds	1,573		1,370
Information technology	6,190		6,219
Professional services	3,471		3,217
General and administrative	5,893		6,830
Impairment expense	—		3,403
Gain on foreign currency transactions	—		(1,196)
Total expenses	50,072		53,759
Net operating income (loss)	3,591		(5,761)
Realized gains on private investments	8,371		—
Net change in unrealized appreciation (depreciation) on private investments	(2,124)		(909)
Investment income	562		625
Other income	390		102
Foreign currency translation adjustments to net income (loss) upon liquidation of a foreign subsidiary	—		(4,193)
Income (loss) before income taxes	10,790		(10,136)
Income tax expense	3,840		1,626
Net income (loss)	$	6,950	$	(11,762)
Other comprehensive income (loss):
Foreign currency translation adjustments	—		(1,250)
Reclassification of cumulative foreign currency translation adjustments to net income (loss) upon liquidation of a foreign subsidiary	—		4,193
Total comprehensive income (loss)	$	6,950	$	(8,819)

Earnings (loss) per share:
Basic	$	0.88	$	(1.46)
Diluted	$	0.88	$	(1.46)

Weighted average shares outstanding:
Basic	7,886,359		8,040,417
Diluted	7,933,860		8,040,417

Economic Earnings	$	12,804	$	2,713
Economic EPS	$	1.61	$	0.34

Dividends declared per share	$	2.70	$	0.43


	September 30, 2021		December 31, 2020
ASSETS
Current Assets:
Cash and cash equivalents	$	18,461	$	13,016
Accounts receivable	9,785		9,450
Investments, at fair value	58,094		69,542
Prepaid income taxes	79		1,700
Other current assets	2,451		2,606
Total current assets	88,870		96,314
Investments	4,455		8,154
Noncurrent investments at fair value	4,185		3,527
Goodwill	16,401		16,401
Deferred income taxes	991		1,468
Operating lease right-of-use assets	5,180		6,103
Intangible assets, net	12,317		13,535
Property and equipment, net of accumulated depreciation of $8,456 and $8,056	2,229		3,186
Other long-term assets	634		464
Total long-term assets	46,392		52,838
Total assets	$	135,262	$	149,152
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Accounts payable and accrued liabilities	$	2,775	$	1,627
Dividends payable	1,333		810
Compensation and benefits payable	6,991		7,448
Operating lease liabilities	1,410		1,718
Accrued stock repurchases	36		—
Income taxes payable	752		191
Total current liabilities	13,297		11,794
Accrued dividends	1,148		526
Noncurrent operating lease liabilities	5,089		6,121
Total long-term liabilities	6,237		6,647
Total liabilities	19,534		18,441

Stockholders’ Equity:
Common stock, $0.01 par value, authorized 25,000,000 shares, issued 10,658,681 and outstanding 8,296,864 shares at September 30, 2021; issued 10,500,549 and outstanding 8,326,948 shares at December 31, 2020	108		105
Additional paid-in capital	193,901		210,268
Treasury stock, at cost - 2,361,817 shares at September 30, 2021; 2,173,559 shares at December 31, 2020	(81,050)		(77,967)

Retained earnings (accumulated deficit)	2,769		(1,695)
Total stockholders’ equity	115,728		130,711
Total liabilities and stockholders’ equity	$	135,262	$	149,152


	Nine Months Ended September 30,
	2021		2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	6,950	$	(11,762)
Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities:
Depreciation	571		697
Amortization of intangible assets	1,218		1,293
Net change in unrealized (appreciation) depreciation on investments	2,425		1,132
Realized gains on private investments	(8,371)		—
Stock-based compensation expense	4,459		5,409
Deferred income taxes	477		(191)
Non-cash lease expense	923		1,253
Gain on asset disposition	(148)		—
Impairment of goodwill	—		3,403
Currency translation adjustment reclassification	—		4,193
Changes in operating assets and liabilities:
Net (purchases) sales of trading securities	11,191		(11,891)
Accounts receivable	(335)		3,634
Other current assets	(15)		246
Accounts payable and accrued liabilities	1,149		(47)
Compensation and benefits payable	(430)		(3,769)
Income taxes payable	2,191		492
Other liabilities	(1,195)		(1,174)
Net cash (used in) provided by operating activities	21,060		(7,082)
CASH FLOWS FROM INVESTING ACTIVITIES:
Sale of investments	9,258		—
Sale of property and equipment	501		—
Purchases of property and equipment	(114)		(92)
Purchases of investments	(15)		—


Net cash provided by (used in) investing activities	9,630		(92)
CASH FLOWS FROM FINANCING ACTIVITIES:
Purchases of treasury stock	(2,164)		(12,952)
Purchases of treasury stock for employee stock plans	—		(697)
Restricted stock returned for payment of taxes	(884)		(1,120)


Cash dividends	(22,125)		(11,043)
Net cash used in financing activities	(25,173)		(25,812)
Effect of currency rate changes on cash	(72)		(1,187)
NET CHANGE IN CASH AND CASH EQUIVALENTS	5,445		(34,173)
Cash and cash equivalents, beginning of period	13,016		49,766
Cash and cash equivalents, end of period	$	18,461	$	15,593
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid during the period for income taxes	$	506	$	1,294
Accrued dividends	$	2,481	$	1,448

Accrued purchases of treasury stock	$	36	$	—