EX-99.1 2 a991-2023q2earningspressre.htm EX-99.1 Document
Exhibit 99.1

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Federated Hermes, Inc. reports second quarter 2023 earnings
•Q2 2023 earnings per diluted share of $0.81
•Total assets under management reach a record high of $704.0 billion
•Money market assets reach a record $509.0 billion
•Board declares $0.28 per share dividend
(PITTSBURGH, Pa., July 27, 2023) — Federated Hermes, Inc. (NYSE: FHI), a global leader in active, responsible investing, today reported earnings per diluted share (EPS) of $0.81 for Q2 2023, compared to $0.64 for the same quarter last year, on net income of $72.2 million for Q2 2023, compared to $57.7 million for Q2 2022.
Federated Hermes' total managed assets were a record $704.0 billion at June 30, 2023, up $72.1 billion or 11% from $631.9 billion at June 30, 2022 and up $3.0 billion or less than 1% from $701.0 billion at March 31, 2023. Total average managed assets for Q2 2023 were $705.3 billion, up $87.4 billion or 14% from $617.9 billion reported for Q2 2022 and up $25.9 billion or 4% from $679.4 billion for Q1 2023.
"In the second quarter, Federated Hermes benefited from a breadth of investment offerings and robust client relationships, as record assets under management were again driven by money market asset increases from the prior quarter," said J. Christopher Donahue, president and chief executive officer. "Investors showed interest in Federated Hermes' international equity offerings and strategies that rely on our proprietary MDT quantitative models. For the second consecutive quarter, we also saw more than $1 billion of net flows into our core multisector bond strategies, which seek attractive opportunities by allocating across investment-grade corporate, high yield, structured product, municipal and international sectors."
Federated Hermes' board of directors declared a dividend of $0.28 per share. The dividend is payable on Aug. 15, 2023 to shareholders of record as of Aug. 8, 2023. During Q2 2023, Federated Hermes purchased 1,236,199 shares of Federated Hermes class B common stock for $43.4 million.
Equity assets were $83.0 billion at June 30, 2023, up $2.0 billion or 2% from $81.0 billion at June 30, 2022 and down $0.6 billion or 1% from $83.6 billion at March 31, 2023. Top-selling equity funds during Q2 2023 on a net basis were Federated Hermes Asia ex-Japan Equity Fund, Federated Hermes MDT Large Cap Growth Fund, Federated Hermes MDT Mid Cap Growth Fund, Federated Hermes International Leaders Fund and Federated Hermes MDT All Cap Core Fund.
Fixed-income assets were $87.4 billion at June 30, 2023, up $1.1 billion or 1% from $86.3 billion at June 30, 2022 and down $0.1 billion or less than 1% from $87.5 billion at March 31, 2023. Top-selling fixed-income funds during Q2 2023 on a net basis were Federated Hermes Total Return Bond Fund, Federated Hermes Government Ultrashort Fund, Federated Hermes SDG Engagement High Yield Credit Fund (UCITS), Federated Hermes Total Return Bond Collective Investment Fund and Federated Hermes Conservative Municipal Microshort Fund.
Alternative/private markets assets were $21.6 billion at June 30, 2023, down $0.2 billion or 1% from $21.8 billion at June 30, 2022 and up $0.4 billion or 2% from $21.2 billion at March 31, 2023.
MEDIA:MEDIA:ANALYSTS:
Ed Costello 412-288-7538Meghan McAndrew 412-288-8103Ray Hanley 412-288-1920
    
Federated Hermes reports Q2 2023 earnings
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Money market assets were a record $509.0 billion at June 30, 2023, up $69.3 billion or 16% from $439.7 billion at June 30, 2022 and up $3.2 billion or 1% from $505.8 billion at March 31, 2023. Money market fund assets were a record $364.0 billion at June 30, 2023, up $66.0 billion or 22% from $298.0 billion at June 30, 2022 and up $6.7 billion or 2% from $357.3 billion at March 31, 2023.
Financial Summary
Two transactions impacted Q2 2023 results, with the net after-tax impact of these two transactions resulting in a loss of approximately $800,000.
In the first transaction, a shareholder in a private equity fund sold a portion of their investment to a third-party. As part of the terms of this sale, $25.1 million of carried interest was recorded as revenue, $17.5 million was recorded as related compensation expense and approximately $175,000 was recorded as professional service fee expense.
In the second transaction, as part of a restructuring of an infrastructure fund, Federated Hermes purchased certain limited partners’ rights to receive future carried interest at fair value, which was calculated by a third-party to be approximately $9.8 million. This expense is included in Other expense.
Due to the restructuring, an existing clawback risk on previously earned carried interest was removed, resulting in revenue recognition of $14.2 million of carried interest, as well as $8.8 million of related compensation expense.
The purchase of limited partners’ carried interest rights and related legal and professional fees were not deductible for tax purposes. As a result, the effective tax rate of 27.4% in Q2 2023 was higher than the expected rate of 24%-26%.
Total carried interest and performance fee revenue for Q2 2023 was $39.4 million, of which $25.5 million was recorded as compensation expense and paid to the other carried interest holders.
Q2 2023 vs. Q2 2022
Revenue increased $67.2 million or 18% primarily due to an increase in total carried interest and performance fees of $36.9 million, including $24.6 million of carried interest from consolidated carried interest vehicles, an increase in revenue due to higher average money market assets and the elimination of voluntary fee waivers related to certain money market funds in order for those funds to maintain positive or zero net yields (voluntary yield-related fee waivers). For further information on the waivers, see “Impact of voluntary yield-related fee waivers” below. These increases were partially offset by a decrease in revenue due to lower average long-term assets.
During Q2 2023, Federated Hermes derived 54% of its revenue from long-term assets (28% from equity, 15% from alternative/private markets and multi-asset, and 11% from fixed-income), 45% from money market assets, and 1% from sources other than managed assets.
Operating expenses increased $61.2 million or 22% primarily due to increased compensation expenses resulting from consolidated carried interest vehicles of $24.4 million and an increase in distribution expense due to the elimination of voluntary yield-related fee waivers and higher average managed money market fund assets.
Nonoperating income (expenses), net increased $24.8 million primarily due to a decrease in the market value of investments in Q2 2022 compared to a minimal change in the market value of investments in Q2 2023.


    
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Q2 2023 vs. Q1 2023
Revenue increased $51.0 million or 13% primarily due to an increase in total carried interest and performance fees of $38.0 million, including $25.9 million of carried interest from consolidated carried interest vehicles, and an increase in revenue from higher average money market assets. These increases were partially offset by a decrease in revenue due to lower average equity assets.
Operating expenses increased $37.8 million or 13% due to increased compensation expenses resulting from consolidated carried interest vehicles of $25.7 million and an increase in other expense due to fund reorganization costs.
Nonoperating income (expenses), net decreased $5.2 million primarily due to an increase in the market value of investments in Q1 2023 compared to a minimal change in the market value of investments in Q2 2023.
YTD 2023 vs. YTD 2022
Revenue increased $124.6 million or 18% primarily due to the elimination of voluntary yield-related fee waivers, an increase in revenue from higher average money market assets and an increase in total carried interest and performance fees of $38.2 million, including $24.4 million of carried interest from consolidated carried interest vehicles. These increases were partially offset by a decrease in revenue due to lower average long-term assets.
For the first half of 2023, Federated Hermes derived 53% of its revenue from long-term assets (30% from equity, 12% from fixed-income and 11% from alternative/private markets and multi-asset), 46% from money market assets, and 1% from sources other than managed assets.
Operating expenses increased $117.4 million or 23% primarily due to an increase in distribution expense resulting from the elimination of voluntary yield-related fee waivers and increased compensation expenses resulting from consolidated carried interest vehicles of $24.3 million.
Nonoperating income (expenses), net increased $43.9 million primarily due to an increase in the market value of investments in the first six months of 2023 compared to a decrease in the market value of investments for the same period in 2022.
Impact of voluntary yield-related fee waivers
There were no voluntary yield-related fee waivers during the three and six months ended June 30, 2023. During the three and six months ended June 30, 2022, voluntary yield-related fee waivers totaled $9.5 million and $85.3 million, respectively. These fee waivers were partially offset by related reductions in distribution expenses of $9.0 million and $66.5 million, respectively, such that the net negative pre-tax impact to Federated Hermes was $0.5 million and $18.8 million, respectively, for the three and six months ended June 30, 2022.
Earnings call information
Federated Hermes will host an earnings conference call at 9 a.m. Eastern on July 28, 2023. Investors are invited to listen to the earnings teleconference by calling 888-506-0062 (domestic) or 973-528-0011 (international) prior to the 9 a.m. start time. To listen online, go to the About section of FederatedHermes.com/us at least 15 minutes prior to register and join the call. A replay will be available at approximately 12:30 p.m. Eastern on July 28, 2023. To access the telephone replay, dial 877-481-4010 (domestic) or 919-882-2331 (international) and enter access code 48660. The online replay will be available via FederatedHermes.com/us for one year.


    
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About Federated Hermes
Federated Hermes, Inc. is a global leader in active, responsible investment management, with $704.0 billion in assets under management1. We deliver investment solutions that help investors target a broad range of outcomes and provide equity, fixed-income, alternative/private markets, multi-asset and liquidity management strategies to more than 11,000 institutions and intermediaries worldwide. Our clients include corporations, government entities, insurance companies, foundations and endowments, banks and broker/dealers. Headquartered in Pittsburgh, Federated Hermes has more than 2,000 employees in London, New York, Boston and offices worldwide.
Federated Hermes ranks in the top 7% of equity fund managers in the industry, the top 9% of money market fund managers and the top 10% of fixed-income fund managers2. Federated Hermes also ranks as the 5th-largest manager of model-delivered SMAs3. For more information, including an analyst presentation, which is updated periodically, visit FederatedHermes.com/us.
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1) As of June 30, 2023.
2) Morningstar, June 30, 2023. Based on U.S. fund flows rankings.
3) Money Management Institute/Cerulli,Q1 2023.
Federated Securities Corp. is distributor of the Federated Hermes funds.
Separately managed accounts are made available through Federated Global Investment Management Corp., Federated Investment Counseling, Federated MDTA LLC, Hermes Fund Managers Ireland Limited, Hermes Investment Management Limited, and Hermes GPE LLP, each a registered investment advisor in one or more of the U.S., U.K. or Ireland.


Cautionary statements
Certain statements in this press release, such as those related to performance, investor preferences and demand, asset flows, asset mix, interest rates and fee waivers constitute or may constitute forward-looking statements, which involve known and unknown risks, uncertainties and other factors that may cause the actual results, levels of activity, performance or achievements of the company, or industry results, to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements can include statements that do not relate strictly to historical or current facts and are typically identified by words or phrases such as “trend,” “forecast,” “project,” “predict,” “potential,” “approximate,” “opportunity,” “believe,” “expect,” “anticipate,” “current,” “intention,” “estimate,” “position,” “projection,” “plan,” “assume,” “continue,” “remain,” “maintain,” “sustain,” “seek,” “achieve,” and similar expressions, or future or conditional verbs such as “will,” “would,” “should,” “could,” “can,” “may” and similar expressions. Any forward-looking statement, and Federated Hermes' level of business activity and financial results, are inherently subject to significant business, market, economic, competitive, regulatory and other risks and uncertainties, many of which are difficult to predict and beyond Federated Hermes’ control. Other risks and uncertainties include the ability of the company to predict the level of fee waivers and expenses in future quarters, predict whether performance fees or carried interest will be earned and retained, the ability of the company to sustain product demand, the timing and level of product sales and redemptions, market appreciation or depreciation, revenues, asset levels, flows and mix, which could vary significantly depending on various factors, such as market conditions, investment performance and investor behavior. Other risks and uncertainties include the risk factors discussed in the company's annual and quarterly reports as filed with the Securities and Exchange Commission. As a result, no assurance can be given as to future results, levels of activity, performance or achievements, and neither the company nor any other person assumes responsibility for the accuracy and completeness, or updating, of such statements in the future.


    
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Unaudited Condensed Consolidated Statements of Income
(in thousands, except per share data)
Quarter Ended% Change Q2 2022 to Q2 2023Quarter Ended% Change Q1 2023 to Q2 2023
June 30, 2023June 30, 2022March 31, 2023
Revenue
Investment advisory fees, net$310,337 $258,043 20 %$263,982 18  %
Administrative service fees, net—affiliates85,199 70,182 21 79,180 8 
Other service fees, net37,696 37,783 0 39,027 (3)
Total Revenue433,232 366,008 18 382,189 13 
Operating Expenses
Compensation and related159,883 128,086 25 136,878 17 
Distribution97,086 84,243 15 93,333 4 
Systems and communications22,074 18,446 20 19,972 11 
Professional service fees19,099 13,976 37 16,220 18 
Office and occupancy11,404 10,512 8 12,874 (11)
Advertising and promotional5,109 4,736 8 4,342 18 
Travel and related3,835 3,328 15 3,231 19 
Intangible asset related3,418 3,091 11 3,326 3 
Other12,935 7,272 78 6,847 89 
Total Operating Expenses334,843 273,690 22 297,023 13 
Operating Income98,389 92,318 7 85,166 16 
Nonoperating Income (Expenses)
Investment income (loss), net5,289 (19,308)127 10,312 (49)
Debt expense(3,118)(3,350)(7)(3,125)0 
Other, net(15)(13)(15)122 (112)
Total Nonoperating Income (Expenses), net2,156 (22,671)110 7,309 (71)
Income before income taxes100,545 69,647 44 92,475 9 
Income tax provision27,543 18,889 46 21,009 31 
Net income including the noncontrolling interests in subsidiaries73,002 50,758 44 71,466 2 
Less: Net income (loss) attributable to the noncontrolling interests in subsidiaries827 (6,899)112 1,865 (56)
Net Income$72,175 $57,657 25 %$69,601 4  %
Amounts Attributable to Federated Hermes, Inc.
Earnings Per Share1
Basic and diluted$0.81 $0.64 27 %$0.78 4  %
Weighted-Average Shares Outstanding
Basic84,930 85,563 84,875 
Diluted84,939 85,563 84,875 
Dividends Declared Per Share$0.28 $0.27 $0.27 
1) Unvested share-based awards that receive non-forfeitable dividend rights are deemed participating securities and are required to be considered in the computation of earnings per share under the "two-class method." As such, total net income of $3.5 million, $3.1 million and $3.5 million available to unvested restricted Federated Hermes shareholders for the quarterly periods ended June 30, 2023, June 30, 2022 and March 31, 2023, respectively, was excluded from the computation of earnings per share.

    
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Unaudited Condensed Consolidated Statements of Income
(in thousands, except per share data)
Six Months Ended
June 30, 2023June 30, 2022% Change
Revenue
Investment advisory fees, net$574,318 $491,037 17 %
Administrative service fees, net—affiliates164,378 143,689 14 
Other service fees, net76,725 56,046 37 
Total Revenue815,421 690,772 18 
Operating Expenses
Compensation and related296,761 262,051 13 
Distribution190,420 132,804 43 
Systems and communications42,046 37,940 11 
Professional service fees35,320 27,444 29 
Office and occupancy24,278 21,835 11 
Advertising and promotional9,451 7,468 27 
Travel and related7,066 5,123 38 
Intangible Asset Related6,743 6,425 5 
Other19,781 13,415 47 
Total Operating Expenses631,866 514,505 23 
Operating Income183,555 176,267 4 
Nonoperating Income (Expenses)
Investment income (loss), net15,601 (29,909)152 
Debt expense(6,243)(4,571)37 
Other, net107 68 57 
Total Nonoperating Income (Expenses), net9,465 (34,412)128 
Income before income taxes193,020 141,855 36 
Income tax provision48,552 36,500 33 
Net income including the noncontrolling interests in subsidiaries144,468 105,355 37 
Less: Net income (loss) attributable to the noncontrolling interests in subsidiaries2,692 (8,165)133 
Net Income$141,776 $113,520 25 %
Amounts Attributable to Federated Hermes, Inc.
Earnings Per Share1
Basic and diluted$1.59 $1.24 28 %
Weighted-Average Shares Outstanding
Basic84,902 86,911 
Diluted84,907 86,911 
Dividends Declared Per Share$0.55 $0.54 
1) Unvested share-based awards that receive non-forfeitable dividend rights are deemed participating securities and are required to be considered in the computation of basic earnings per share under the "two-class method." As such, total net income of $7.0 million and $5.5 million available to unvested restricted Federated Hermes shareholders for the six months ended June 30, 2023 and June 30, 2022, respectively, was excluded from the computation of basic earnings per share.




    
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Unaudited Condensed Consolidated Balance Sheets
(in thousands)June 30, 2023Dec. 31, 2022
Assets
  Cash and other investments$520,808 $521,754 
  Other current assets173,540 129,277 
  Intangible assets, net, including goodwill1,221,786 1,209,574 
  Other long-term assets143,609 159,874 
  Total Assets$2,059,743 $2,020,479 
Liabilities, Redeemable Noncontrolling Interests and Equity
  Current liabilities$234,496 $257,413 
  Long-term debt347,711 347,581 
  Other long-term liabilities285,668 307,972 
  Redeemable noncontrolling interests58,012 61,821 
Equity excluding treasury stock1,537,357 1,411,055 
Treasury stock(403,501)(365,363)
  Total Liabilities, Redeemable Noncontrolling Interests and Equity$2,059,743 $2,020,479 



    
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Unaudited Changes in Long-Term Assets - By Asset Class
(in millions)Quarter EndedSix Months Ended
June 30, 2023March 31, 2023June 30, 2022June 30, 2023June 30, 2022
Equity
Beginning assets$83,629 $81,523 $91,676 $81,523 $96,716 
Sales1
4,869 5,631 6,595 10,500 13,587 
Redemptions1
(5,697)(4,736)(7,564)(10,433)(14,634)
Net sales (redemptions)1
(828)895 (969)67 (1,047)
Net exchanges5 103 20 108 (154)
Impact of foreign exchange2
71 108 (1,199)179 (1,653)
Market gains and (losses)3
115 1,000 (8,540)1,115 (12,874)
Ending assets$82,992 $83,629 $80,988 $82,992 $80,988 
Fixed Income
Beginning assets$87,461 $86,743 $92,146 $86,743 $97,550 
Sales1
4,891 6,047 6,991 10,938 14,415 
Redemptions1
(4,963)(7,127)(8,950)(12,090)(18,387)
Net sales (redemptions)1
(72)(1,080)(1,959)(1,152)(3,972)
Net exchanges6 (101)(51)(95)95 
Impact of foreign exchange2
43 38 (225)81 (329)
Market gains and (losses)3
(13)1,861 (3,658)1,848 (7,091)
Ending assets$87,425 $87,461 $86,253 $87,425 $86,253 
Alternative/Private Markets
Beginning assets$21,174 $20,802 $23,109 $20,802 $22,920 
Sales1
643 1,265 1,116 1,908 1,760 
Redemptions1
(745)(792)(1,091)(1,537)(1,596)
Net sales (redemptions)1
(102)473 25 371 164 
Net exchanges(4)1 4 (3)4 
Impact of foreign exchange2
539 368 (1,555)907 (2,192)
Market gains and (losses)3
(5)(470)202 (475)889 
Ending assets$21,602 $21,174 $21,785 $21,602 $21,785 
Multi-asset
Beginning assets$2,973 $2,989 $3,555 $2,989 $3,780 
Sales1
33 47 43 80 117 
Redemptions1
(143)(144)(143)(287)(275)
Net sales (redemptions)1
(110)(97)(100)(207)(158)
Net exchanges1 2 1 3 6 
Market gains and (losses)3
58 79 (321)137 (493)
Ending assets$2,922 $2,973 $3,135 $2,922 $3,135 
Total Long-term Assets
Beginning assets$195,237 $192,057 $210,486 $192,057 $220,966 
Sales1
10,436 12,990 14,745 23,426 29,879 
Redemptions1
(11,548)(12,799)(17,748)(24,347)(34,892)
Net sales (redemptions)1
(1,112)191 (3,003)(921)(5,013)
Net exchanges8 5 (26)13 (49)
Impact of foreign exchange2
653 514 (2,979)1,167 (4,174)
Market gains and (losses)3
155 2,470 (12,317)2,625 (19,569)
Ending assets$194,941 $195,237 $192,161 $194,941 $192,161 
1) For certain accounts, Sales and Redemptions are calculated as the remaining difference between beginning and ending assets after the calculation of total investment return.
2) Reflects the impact of translating non-U.S. dollar denominated assets under management (AUM) into U.S. dollars for reporting purposes.
3) Reflects the approximate changes in the fair value of the securities held by portfolios and, to a lesser extent, reinvested dividends, distributions and net investment income.




    
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Unaudited Changes in Long-Term Assets - By Asset Class and Product Type
(in millions)
Quarter Ended
June 30, 2023
EquityFixed IncomeAlternative / Private MarketsMulti-assetTotal
Funds
Separate Accounts1
Funds
Separate Accounts1
Funds
Separate Accounts1
Funds
Separate Accounts1
Funds.
Separate Accounts1
Beginning assets$44,732 $38,897 $43,616 $43,845 $13,040 $8,134 $2,832 $141 $104,220 $91,017 
Sales2,155 2,714 3,836 1,055 439 204 32 1 6,462 3,974 
Redemptions(3,548)(2,149)(3,589)(1,374)(641)(104)(138)(5)(7,916)(3,632)
Net sales (redemptions)(1,393)565 247 (319)(202)100 (106)(4)(1,454)342 
Net exchanges(8)13 6 0 (4)0 1 0 (5)13 
Impact of foreign exchange2
131 (60)34 9 322 217 0 0 487 166 
Market gains and (losses)3
921 (806)(19)6 182 (187)55 3 1,139 (984)
Ending assets$44,383 $38,609 $43,884 $43,541 $13,338 $8,264 $2,782 $140 $104,387 $90,554 
Six Months Ended
June 30, 2023
EquityFixed IncomeAlternative / Private MarketsMulti-assetTotal
Funds
Separate Accounts1
Funds
Separate Accounts1
Funds
Separate Accounts1
Funds
Separate Accounts1
Funds
Separate Accounts1
Beginning assets$43,342 $38,181 $43,180 $43,563 $13,050 $7,752 $2,851 $138 $102,423 $89,634 
Sales5,326 5,174 8,091 2,847 1,283 625 79 1 14,779 8,647 
Redemptions(6,544)(3,889)(8,288)(3,802)(1,298)(239)(277)(10)(16,407)(7,940)
Net sales (redemptions) (1,218)1,285 (197)(955)(15)386 (198)(9)(1,628)707 
Net exchanges82 26 (95)0 20 (23)3 0 10 3 
Impact of foreign exchange2
216 (37)59 22 546 361 0 0 821 346 
Market gains and (losses)3
1,961 (846)937 911 (263)(212)126 11 2,761 (136)
Ending assets$44,383 $38,609 $43,884 $43,541 $13,338 $8,264 $2,782 $140 $104,387 $90,554 
1)    Includes separately managed accounts, institutional accounts, certain sub-advised funds and other managed products. For certain accounts, Sales and Redemptions are calculated as the remaining difference between beginning and ending assets after the calculation of total investment return.
2) Reflects the impact of translating non-U.S. dollar denominated AUM into U.S. dollars for reporting purposes.
3)    Reflects the approximate changes in the fair value of the securities held by portfolios and, to a lesser extent, reinvested dividends, distributions and net investment income.









    
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Unaudited Changes in Long-Term Assets - By Product Type
(in millions)
Quarter EndedSix Months Ended
June 30, 2023March 31, 2023June 30, 2022June 30, 2023June 30, 2022
Total Fund Assets
Beginning assets$104,220 $102,423 $124,968 $102,423 $135,294 
Sales6,462 8,317 8,743 14,779 18,600 
Redemptions(7,916)(8,491)(12,993)(16,407)(26,097)
Net sales (redemptions)(1,454)(174)(4,250)(1,628)(7,497)
Net exchanges(5)15 (27)10 (48)
Impact of foreign exchange1
487 334 (1,827)821 (2,593)
Market gains and (losses)2
1,139 1,622 (9,530)2,761 (15,822)
Ending assets$104,387 $104,220 $109,334 $104,387 $109,334 
Total Separate Account Assets3
Beginning assets$91,017 $89,634 $85,518 $89,634 $85,672 
Sales4
3,974 4,673 6,002 8,647 11,279 
Redemptions4
(3,632)(4,308)(4,755)(7,940)(8,795)
Net sales (redemptions)4
342 365 1,247 707 2,484 
Net exchanges13 (10)1 3 (1)
Impact of foreign exchange1
166 180 (1,152)346 (1,581)
Market gains and (losses)2
(984)848 (2,787)(136)(3,747)
Ending assets$90,554 $91,017 $82,827 $90,554 $82,827 
Total Long-term Assets3
Beginning assets$195,237 $192,057 $210,486 $192,057 $220,966 
Sales4
10,436 12,990 14,745 23,426 29,879 
Redemptions4
(11,548)(12,799)(17,748)(24,347)(34,892)
Net sales (redemptions)4
(1,112)191 (3,003)(921)(5,013)
Net exchanges8 5 (26)13 (49)
Impact of foreign exchange1
653 514 (2,979)1,167 (4,174)
Market gains and (losses)2
155 2,470 (12,317)2,625 (19,569)
Ending assets$194,941 $195,237 $192,161 $194,941 $192,161 
1) Reflects the impact of translating non-U.S. dollar denominated AUM into U.S. dollars for reporting purposes.
2) Reflects the approximate changes in the fair value of the securities held by portfolios and, to a lesser extent, reinvested dividends, distributions and net investment income.
3) Includes separately managed accounts, institutional accounts, certain sub-advised funds and other managed products.
4)    For certain accounts, Sales and Redemptions are calculated as the remaining difference between beginning and ending assets after the calculation of total investment return.




















    
Federated Hermes reports Q2 2023 earnings
Page 11 of 13
Unaudited Managed Assets

(in millions)
June 30, 2023March 31, 2023Dec. 31, 2022Sept. 30, 2022June 30, 2022
By Asset Class
Equity$82,992 $83,629 $81,523 $74,684 $80,988 
Fixed-income87,425 87,461 86,743 85,365 86,253 
Alternative / private markets21,602 21,174 20,802 20,182 21,785 
Multi-asset2,922 2,973 2,989 2,902 3,135 
Total long-term assets194,941 195,237 192,057 183,133 192,161 
Money market509,017 505,800 476,844 441,294 439,697 
Total Managed Assets$703,958 $701,037 $668,901 $624,427 $631,858 
By Product Type
Funds:
Equity$44,383 $44,732 $43,342 $40,633 $44,207 
Fixed-income43,884 43,616 43,180 44,896 48,215 
Alternative / private markets13,338 13,040 13,050 12,680 13,911 
Multi-asset2,782 2,832 2,851 2,784 3,001 
Total long-term assets104,387 104,220 102,423 100,993 109,334 
Money market364,014 357,346 335,937 309,859 298,031 
Total Fund Assets$468,401 $461,566 $438,360 $410,852 $407,365 
Separate Accounts:
Equity$38,609 $38,897 $38,181 $34,051 $36,781 
Fixed-income43,541 43,845 43,563 40,469 38,038 
Alternative / private markets8,264 8,134 7,752 7,502 7,874 
Multi-asset140 141 138 118 134 
Total long-term assets90,554 91,017 89,634 82,140 82,827 
Money market145,003 148,454 140,907 131,435 141,666 
Total Separate Account Assets$235,557 $239,471 $230,541 $213,575 $224,493 
Total Managed Assets$703,958 $701,037 $668,901 $624,427 $631,858 

    
Federated Hermes reports Q2 2023 earnings
Page 12 of 13
Unaudited Average Managed AssetsQuarter Ended
(in millions)
June 30, 2023March 31, 2023Dec. 31, 2022Sept. 30, 2022June 30, 2022
By Asset Class
Equity$83,025 $84,155 $79,544 $81,809 $85,785 
Fixed-income87,504 88,209 87,849 87,042 88,740 
Alternative / private markets21,411 20,938 20,926 21,193 22,230 
Multi-asset2,929 3,012 2,988 3,144 3,337 
Total long-term assets194,869 196,314 191,307 193,188 200,092 
Money market510,418 483,083 442,334 438,601 417,778 
Total Avg. Managed Assets$705,287 $679,397 $633,641 $631,789 $617,870 
By Product Type
Funds:
Equity$44,218 $45,055 $43,131 $45,135 $47,504 
Fixed-income43,827 43,961 44,099 47,489 51,173 
Alternative / private markets13,181 13,062 13,140 13,432 14,297 
Multi-asset2,787 2,869 2,855 3,012 3,193 
Total long-term assets104,013 104,947 103,225 109,068 116,167 
Money market362,608 333,358 309,232 301,940 275,631 
Total Avg. Fund Assets$466,621 $438,305 $412,457 $411,008 $391,798 
Separate Accounts:
Equity$38,807 $39,100 $36,413 $36,674 $38,281 
Fixed-income43,677 44,248 43,750 39,553 37,567 
Alternative / private markets8,230 7,876 7,786 7,761 7,933 
Multi-asset142 143 133 132 144 
Total long-term assets90,856 91,367 88,082 84,120 83,925 
Money market147,810 149,725 133,102 136,661 142,147 
Total Avg. Separate Account Assets$238,666 $241,092 $221,184 $220,781 $226,072 
Total Avg. Managed Assets$705,287 $679,397 $633,641 $631,789 $617,870 


    
Federated Hermes reports Q2 2023 earnings
Page 13 of 13
Unaudited Average Managed AssetsSix Months Ended
(in millions)June 30, 2023June 30, 2022
By Asset Class
Equity$83,590 $88,910 
Fixed-income87,856 92,108 
Alternative / private markets21,174 22,539 
Multi-asset2,971 3,479 
Total long-term assets195,591 207,036 
Money market496,751 425,516 
Total Avg. Managed Assets$692,342 $632,552 
By Product Type
Funds:
Equity$44,637 $49,962 
Fixed-income43,893 54,293 
Alternative / private markets13,121 14,521 
Multi-asset2,828 3,326 
Total long-term assets104,479 122,102 
Money market347,983 283,394 
Total Avg. Fund Assets$452,462 $405,496 
Separate Accounts:
Equity$38,953 $38,948 
Fixed-income43,963 37,815 
Alternative / private markets8,053 8,018 
Multi-asset143 153 
Total long-term assets91,112 84,934 
Money market148,768 142,122 
Total Avg. Separate Account Assets$239,880 $227,056 
Total Avg. Managed Assets$692,342 $632,552