Medley Management Inc. Reports First Quarter 2019 Results

For the Three Months Ended March 31,

(unaudited)

2019

2018

(dollars in thousands, except AUM, share and
per share amounts)

Consolidated Financial Data:

Pre-Tax Income (Loss)

$

3,739

$

(9,451)

Net loss attributable to Medley Management Inc. and non-controlling
interests in Medley LLC

$

(433)

$

(5,127)

Net loss per Class A common stock

$

(0.02)

$

(0.26)

Net Income Margin ⁽¹⁾

(3.1)

%

(35.6)

%

Weighted average shares - Basic and Diluted

5,754,665

5,483,303

Non-GAAP Data:

Pre-Tax Core Net Income ⁽²⁾

$

804

$

2,108

Core Net Income  ⁽²⁾

$

705

$

1,257

Core EBITDA  ⁽³⁾

$

3,880

$

5,008

Core Net Income Per Share ⁽⁴⁾

$

0.02

$

0.05

Core Net Income Margin ⁽⁵⁾

5.1

%

9.8

%

Pro-Forma Weighted Average Shares Outstanding ⁽⁶⁾

32,117,893

30,635,399

Other Data (at period end, in millions):

AUM

$

4,668

$

5,076

Fee Earning AUM

$

2,711

$

3,040

⁽¹⁾ 

Net Income Margin equals Net loss attributable to Medley Management Inc. and non-controlling interests in Medley LLC divided by total revenue.

⁽²⁾ 

Pre-Tax Core Net Income is calculated as Core Net Income before income taxes. Core Net Income reflects net loss attributable to Medley Management Inc. and non-controlling interests in Medley LLC adjusted to exclude reimbursable expenses associated with the launch of funds, stock-based compensation associated with restricted stock units that were granted in connection with our IPO, non-recurring expenses associated with strategic initiatives, such as our pending merger with Sierra, other non-core items and the income tax expense associated with the foregoing adjustments. Please refer to the reconciliation of Core Net Income to Net income attributable to Medley Management Inc. and non-controlling interests in Medley LLC in Exhibit B for additional details.

⁽³⁾ 

Core EBITDA is calculated as Core Net Income before interest expense, income taxes, depreciation and amortization. Please refer to the reconciliation of Core EBITDA to Net income attributable to Medley Management Inc. and non-controlling interests in Medley LLC in Exhibit B for additional details.

⁽⁴⁾ 

Core Net Income Per Share is calculated as Core Net Income, adjusted for the income tax effect of assuming that all of our pre-tax earnings were subject to federal, state and local corporate income taxes, divided by Pro-Forma Weighted Average Shares Outstanding (as defined below).  We assume that all of our pre-tax earnings are subject to federal, state and local corporate income taxes. In determining corporate income taxes, we used a combined effective corporate tax rate of 33.0%. Please refer to the calculation of Core Net Income Per Share in Exhibit C for additional details.

⁽⁵⁾ 

Core Net Income Margin equals Core Net Income Per Share divided by total revenue per share.

⁽⁶⁾ 

The calculation of Pro-Forma Weighted Average Shares Outstanding assumes the conversion by the pre-IPO holders of up to 24,705,970 vested and unvested LLC Units for 24,705,970 shares of Class A common stock at the beginning of each period presented, as well as the vesting of the weighted average number of restricted stock units granted to employees and directors during each of the periods presented.