Diamond Hill Investment Group, Inc. Reports Results For Third Quarter 2025 And Declares Quarterly And Special Dividend

Diamond Hill Investment Group, Inc. (Nasdaq: DHIL) today reported unaudited financial results for the third quarter of 2025. The following are selected highlights for the quarter ended September 30, 2025: Assets under management ("AUM") and assets under advisement ("AUA") combined were $32.4 billion, compared to $31.9 billion as of December 31, 2024, and $33.2 billion as of September 30, 2024. Average AUM and AUA combined were $32.4 billion, compared to $32.4 billion for the third quarter of 2024. Net client inflows were $41.0 million, compared to $22.0 million of net outflows for the third quarter of 2024. Revenue was $37.4 million, compared to $39.0 million for the third quarter of 2024. Net operating profit margin was 26%, for both the third quarter of 2025 and 2024, respectively. Adjusted net operating profit margin1 was 32% for the third quarter of 2025 and 32% for the third quarter of 2024. Investment income was $8.5 million, compared to investment income of $9.7 million for the third quarter of 2024. Net income attributable to common shareholders was $13.6 million, compared to $14.6 million for the third quarter of 2024. Earnings per share attributable to common shareholders - diluted was $4.99, compared to $5.35 for the third quarter of 2024. Adjusted earnings per share attributable to common shareholders - diluted2 was $3.24, compared to $3.35 for the third quarter of 2024. The Company returned approximately $6.7 million to its shareholders - $2.6 million through the repurchase of 18,871 common shares and $4.1 million through a dividend of $1.50 per common share. "We are encouraged by the continued growth of our fixed income strategies, which added nearly $1 billion in net flows this quarter and $2 billion year-to-date," said Heather Brilliant, CEO. "Additionally, the conversion of our Large Cap Concentrated Fund to an ETF during the quarter highlights our commitment to delivering our investment capabilities through vehicles that best serve our clients." _____________________________________________ 1 A djusts the financial measure calculated in accordance with U.S. generally accepted accounting principles ("GAAP") for the impact of market movements on the deferred compensation liability and related economic hedges, and the impact of any consolidated funds. During the third quarter of 2025, the Diamond Hill Securitized Total Return Fund was consolidated. During the third quarter of 2024, no Proprietary Funds were consolidated. The "Proprietary Funds" consist of the Diamond Hill Funds, a series of open-end mutual funds and an exchange traded fund, and the Diamond Hill Securitized Credit Fund, a closed-end registered investment company. The Proprietary Fund(s) consolidated during the applicable period is referred to as the "Consolidated Funds." See the reconciliation to the comparable GAAP financial measure at the end of this earnings release. 2 Adjusts the financial measure calculated in accordance with GAAP for the impact of the Consolidated Fund(s) and investment income related to certain other investments. See the reconciliation to the comparable GAAP financial measure at the end of this earnings release. Capital Allocation: The Company's board of directors approved the payment of a regular quarterly cash dividend of $1.50 per common share. The board of directors also approved a special dividend of $4.00 per share. Both the fourth quarter regular dividend and the special dividend will be paid on December 5, 2025, to the Company's shareholders of record as of the close of business on November 21, 2025. The Company expects 100% of the distributions to be classified as qualified dividends. "We are pleased with our total capital return to shareholders this year, repurchasing nearly $14.5 million in shares year to date," said Heather Brilliant, CEO. "Additionally, our Q4 special dividend of $4.00 per share brings our total annual dividends to $10.00 per share, resulting in another $27.2 million returned to shareholders during 2025." Selected Income Statement Data Three Months EndedSeptember 30, 2025 2024 % Change Revenue $ 37,402,519 $ 39,018,232 (4) % Compensation and related costs, excluding deferred compensationexpense 18,352,666 19,509,116 (6) % Deferred compensation expense 2,051,506 2,250,168 (9) % Other expenses 7,269,842 7,041,477 3 % Total operating expenses 27,674,014 28,800,761 (4) % Net operating income 9,728,505 10,217,471 (5) % Investment income, net 8,493,730 9,668,961 (12) % Net income before taxes 18,222,235 19,886,432 (8) % Income tax expense (4,656,802) (5,241,839) (11) % Net income 13,565,433 14,644,593 (7) % Net income attributable to redeemable noncontrolling interest (14,822) - NM Net income attributable to common shareholders $ 13,550,611 $ 14,644,593 (7) % Earnings per share attributable to common shareholders - diluted $ 4.99 $ 5.35 (7) % Weighted average shares outstanding - diluted 2,718,171 2,738,588 (1) % Nine Months Ended September 30, 2025 2024 % Change Revenue $ 110,544,660 $ 111,974,495 (1) % Compensation and related costs, excluding deferred compensationexpense 54,244,542 55,987,247 (3) % Deferred compensation expense 4,128,757 4,571,396 (10) % Other expenses 21,613,893 20,762,944 4 % Total operating expenses 79,987,192 81,321,587 (2) % Net operating income 30,557,468 30,652,908 (0) % Investment income, net 24,168,384 18,380,048 31 % Net income before taxes 54,725,852 49,032,956 12 % Income tax expense (14,629,141) (13,246,590) 10 % Net income 40,096,711 35,786,366 12 % Net income attributable to redeemable noncontrolling interest (613,260) - NM Net income attributable to common shareholders $ 39,483,451 $ 35,786,366 10 % Earnings per share attributable to common shareholders - diluted $ 14.47 $ 12.90 12 % Weighted average shares outstanding - diluted 2,728,671 2,774,819 (2) % Selected Assets Under Management and Assets Under Advisement Data Change in AssetsUnder Management For the Three MonthsEnded September 30, (in millions) 2025 2024 AUM at beginning of period $ 30,071 $ 29,291 Net cash inflows (outflows) Proprietary Funds 171 423 Separately managed accounts (227) (313) Collective investment trusts 220 (23) Other pooled vehicles (123) (109) 41 (22) Net market appreciation and income 471 2,006 Increase during period 512 1,984 AUM at end of period 30,583 31,275 AUA at end of period 1,828 1,957 Total AUM and AUA at end of period $ 32,411 $ 33,232 Average AUM during period $ 30,543 $ 30,488 Average AUA during period 1,813 1,928 Total Average AUM and AUA during period $ 32,356 $ 32,416 Change in AssetsUnder Management For the Nine MonthsEnded September 30, (in millions) 2025 2024 AUM at beginning of period $ 30,012 $ 27,418 Net cash inflows (outflows) Proprietary Funds 412 632 Separately managed accounts (950) (661) Collective investment trusts (340) 394 Other pooled vehicles (254) (40) (1,132) 325 Net market appreciation and income 1,703 3,532 Increase during period 571 3,857 AUM at end of period 30,583 31,275 AUA at end of period 1,828 1,957 Total AUM and AUA at end of period $ 32,411 $ 33,232 Average AUM during period $ 30,087 $ 29,333 Average AUA during period 1,835 1,870 Total Average AUM and AUA during period $ 31,922 $ 31,203 Net Cash Inflows (Outflows) Further Breakdown For the Three Months Ended September 30, For the Nine Months EndedSeptember 30, (in millions) 2025 2024 2025 2024 Net cash inflows (outflows) Equity $ (935) $ (477) $ (3,120) $ (1,199) Fixed Income 976 455 1,988 1,524 $ 41 $ (22) $ (1,132) $ 325... 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