EX-99.2 3 cns-earningsreleasex123120.htm CNS EARNINGS RELEASE Document

                                cnslogo1219a011b.jpg

Contact:
Matthew S. Stadler
Executive Vice President
Chief Financial Officer
Cohen & Steers, Inc.
Tel (212) 446-9168


COHEN & STEERS REPORTS RESULTS FOR THE FOURTH QUARTER AND YEAR ENDED DECEMBER 31, 2020

•Diluted EPS of ($0.09) for the fourth quarter; $1.57 for the full year
•Diluted EPS, as adjusted, of $0.76 for the fourth quarter; $2.57 for the full year
•Operating margin of (10.2%) for the fourth quarter; 22.2% for the full year
•Operating margin, as adjusted, of 42.4% for the fourth quarter; 39.6% for the full year
•Ending AUM of $79.9 billion; average AUM of $75.4 billion for the fourth quarter
•Net inflows of $3.9 billion for the fourth quarter, of which $2.1 billion was from the initial public offering of the
Cohen & Steers Tax-Advantaged Preferred Securities and Income Fund (PTA), a closed-end fund

NEW YORK, NY, January 27, 2021—Cohen & Steers, Inc. (NYSE: CNS) reported its operating results for the fourth quarter and year ended December 31, 2020.
Financial Highlights
(in thousands, except percentages and per share data) Three Months EndedYear Ended
December 31, 2020September 30, 2020December 31, 2019December 31, 2020December 31, 2019
U.S. GAAP
Revenue$116,460 $111,159 $109,847 $427,536 $410,830 
Expenses (1)
$128,374 $67,852 $63,385 $332,479 $250,696 
Operating income (loss)$(11,914)$43,307 $46,462 $95,057 $160,134 
Non-operating income (loss)$6,989 $3,231 $1,352 $(1,670)$27,415 
Net income (loss) attributable to common stockholders$(4,412)$31,904 $36,728 $76,584 $134,621 
Diluted earnings (loss) per share$(0.09)$0.66 $0.75 $1.57 $2.79 
Operating margin(10.2)%39.0 %42.3 %22.2 %39.0 %
As Adjusted (2)
Net income attributable to common stockholders$37,082 $32,616 $35,997 $125,291 $124,360 
Diluted earnings per share$0.76 $0.67 $0.74 $2.57 $2.57 
Operating margin42.4 %39.6 %43.1 %39.6 %39.6 %
_________________________

(1)    Includes expenses of $60.2 million associated with the initial public offering of PTA in the fourth quarter of 2020.
(2)    The “As Adjusted” amounts represent non-GAAP financial measures. Refer to pages 19-20 for reconciliations to the most directly comparable U.S. GAAP financial measures.




1

U.S. GAAP
This section discusses the financial results of the Company as presented in accordance with U.S. GAAP.
Revenue
Revenue for the fourth quarter of 2020 was $116.5 million, an increase of $5.3 million, or 4.8% from $111.2 million for the third quarter of 2020. The change was primarily due to an increase in investment advisory and administration fees of $8.6 million attributable to higher average assets under management in all three investment vehicles, partially offset by lower performance fees from certain institutional accounts of $3.8 million. Changes to investment advisory and administration fee revenue by investment vehicle were as follows:
•Institutional account revenue decreased $2.2 million to $30.6 million;
•Open-end fund revenue increased $3.5 million to $55.1 million; and
•Closed-end fund revenue increased $3.5 million to $22.2 million.
Revenue for the year ended December 31, 2020 was $427.5 million, an increase of $16.7 million, or 4.1% from $410.8 million for the year ended December 31, 2019.
Expenses
Expenses for the fourth quarter of 2020 were $128.4 million, an increase of $60.5 million, or 89.2% from $67.9 million for the third quarter of 2020. The change was primarily due to:
•Higher employee compensation and benefits of $1.4 million, primarily due to higher commissions of $1.3 million associated with the initial public offering of PTA; and
•Higher distribution and service fees of $59.2 million, primarily due to $57.8 million of costs associated with the initial public offering of PTA.
Expenses for the year ended December 31, 2020 were $332.5 million, an increase of $81.8 million, or 32.6% from $250.7 million for the year ended December 31, 2019.
Operating Margin
Operating margin was (10.2%) for the fourth quarter of 2020, compared with 39.0% for the third quarter of 2020. Operating margin was 22.2% for the year ended December 31, 2020, compared with 39.0% for the year ended December 31, 2019. In the fourth quarter of 2020, expenses included costs of $60.2 million associated with the initial public offering of PTA. Operating margin represents the ratio of operating income to revenue.
2

Non-operating Income (Loss)
(in thousands)Three Months Ended
December 31, 2020September 30, 2020
Seed InvestmentsOtherTotalSeed InvestmentsOtherTotal
Interest and dividend income—net$573 $53 $626 $574 $120 $694 
Gain (loss) from investments—net7,315 — 7,315 3,279 — 3,279 
Foreign currency gains (losses)—net191 (1,143)(952)108 (850)(742)
Total non-operating income (loss)$8,079 
(1)
$(1,090)$6,989 $3,961 
(1)
$(730)$3,231 
_________________________

(1) Seed investments included net income of $5.3 million and $2.1 million attributable to third-party interests for the three months ended December 31, 2020 and September 30, 2020, respectively.

(in thousands)Year Ended
December 31, 2020December 31, 2019
Seed InvestmentsOtherTotalSeed InvestmentsOtherTotal
Interest and dividend income—net$2,358 $1,004 $3,362 $3,052 $3,664 $6,716 
Gain (loss) from investments—net(4,116)— (4,116)21,673 — 21,673 
Foreign currency gains (losses)—net(399)(517)(916)381 (1,355)(974)
Total non-operating income (loss)$(2,157)
(1)
$487 $(1,670)$25,106 
(1)
$2,309 $27,415 
_________________________

(1) Seed investments included net loss of $1.4 million and net income of $12.4 million attributable to third-party interests for the years ended December 31, 2020 and 2019, respectively.

Income Taxes
The effective tax rate for the fourth quarter of 2020 was 57.0%, compared with 28.2% for the third quarter of 2020. The effective tax rate for the fourth quarter of 2020 differed from the U.S. federal statutory rate of 21% primarily due to state and local taxes as well as the effect of certain permanent differences, the most significant of which related to limitations on the deductibility of executive compensation, and discrete tax items, primarily related to the reversal of certain liabilities associated with unrecognized tax benefits. The effective tax rate for the third quarter of 2020 differed from the U.S. federal statutory rate of 21% primarily due to state, local and foreign taxes as well as the effect of certain permanent differences, the most significant of which related to limitations on the deductibility of executive compensation.
The effective tax rate for the year ended December 31, 2020 was 19.2%, compared with 23.2% for the year ended December 31, 2019. The effective tax rate for the year ended December 31, 2020 differed from the U.S. federal statutory rate of 21.0% primarily due to state, local and foreign taxes as well as the effect of certain permanent differences, the most significant of which related to limitations on the deductibility of executive compensation. These were more than offset by discrete tax items, primarily related to the appreciated value of restricted stock units delivered in January 2020. The effective tax rate for the year ended December 31, 2019 differed from the U.S. federal statutory rate of 21.0% primarily due to state, local and foreign taxes, partially offset by the reversal of certain liabilities associated with unrecognized tax benefits, the release of a portion of the valuation allowance associated with unrealized gains on the Company's seed investments and a discrete item related to the appreciated value of restricted stock units delivered in January 2019.
3

As Adjusted
The term “As Adjusted” is used to identify non-GAAP financial information in the discussion below. Refer to pages 19-20 for reconciliations to the most directly comparable U.S. GAAP financial measures.
Revenue
Revenue, as adjusted, for the fourth quarter of 2020 was $116.6 million, compared with $111.4 million for the third quarter of 2020. Revenue, as adjusted, for the year ended December 31, 2020 was $427.8 million, compared with $410.4 million for the year ended December 31, 2019.
Revenue, as adjusted, excluded the consolidation of certain of the Company's seed investments for all periods.
Expenses
Expenses, as adjusted, for the fourth quarter of 2020 were $67.2 million, compared with $67.3 million for the third quarter of 2020. Expenses, as adjusted, for the year ended December 31, 2020 were $258.4 million, compared with $247.7 million for the year ended December 31, 2019.
Expenses, as adjusted, excluded the following:
•The consolidation of certain of the Company's seed investments for all periods;
•Amounts related to the accelerated vesting of certain restricted stock units for all periods;
•Costs associated with the initial public offering of PTA for both the fourth and third quarters and full year 2020;
•Costs associated with the Cohen & Steers Quality Income Realty Fund, Inc. rights offering for the first quarter of 2020 and fourth quarter of 2019; and
•Other non-recurring expenses for the fourth quarter of 2020.
Operating Margin
Operating margin, as adjusted, for the fourth quarter of 2020 was 42.4%, compared with 39.6% for the third quarter of 2020. Operating margin, as adjusted, for both the years ended December 31, 2020 and 2019 was 39.6%.
Non-operating Income
Non-operating income, as adjusted, for the fourth quarter of 2020 was $593,000, compared with $502,000 for the third quarter of 2020. Non-operating income, as adjusted, for the year ended December 31, 2020 was $1.4 million, compared with $4.2 million for the year ended December 31, 2019.
Non-operating income, as adjusted, excluded the following for all periods:
•Results from the Company's seed investments; and
•Net foreign currency exchange gains and losses associated with U.S. dollar-denominated assets held by certain foreign subsidiaries.

4

Income Taxes
The effective tax rate, as adjusted, for the fourth quarter of 2020 was 25.8%, compared with 27.0% for the third quarter of 2020. The effective tax rate, as adjusted, for the year ended December 31, 2020 was 26.7%, compared with 25.5% for the year ended December 31, 2019.
The effective tax rate, as adjusted, excluded the tax effects associated with non-GAAP adjustments as well as discrete items for all periods.
Assets Under Management
(in millions)As of
By Investment VehicleDecember 31, 2020September 30, 2020% Change
    Institutional accounts$33,255 $30,380 9.5 %
    Open-end funds35,160 31,404 12.0 %
    Closed-end funds11,493 8,719 31.8 %
Total$79,908 $70,503 13.3 %
By Investment Strategy
    U.S. real estate$32,827 $29,610 10.9 %
    Preferred securities23,185 19,010 22.0 %
    Global/international real estate15,214 13,863 9.7 %
    Global listed infrastructure6,729 6,299 6.8 %
    Other1,953 1,721 13.5 %
Total$79,908 $70,503 13.3 %
Assets under management at December 31, 2020 were $79.9 billion, an increase of 13.3% from $70.5 billion at September 30, 2020. The increase was driven by net inflows of $3.9 billion and market appreciation of $6.4 billion, partially offset by distributions of $859 million.
Institutional Accounts
Assets under management in institutional accounts at December 31, 2020 were $33.3 billion, an increase of 9.5% from $30.4 billion at September 30, 2020. The change was primarily due to the following:
•Advisory:
◦Net outflows of $101 million, including $214 million from global/international real estate and $96 million from global listed infrastructure, partially offset by net inflows of $173 million into U.S. real estate; and
◦Market appreciation of $1.6 billion, including $779 million from global/international real estate and $420 million from U.S. real estate.
•Japan subadvisory:
◦Net inflows of $83 million;
◦Market appreciation of $997 million, including $763 million from U.S. real estate and $219 million from global/international real estate; and
◦Distributions of $376 million, including $368 million from U.S. real estate.

5

•Subadvisory excluding Japan:
◦Net inflows of $10 million; and
◦Market appreciation of $626 million, including $430 million from global/international real estate and $124 million from global listed infrastructure.
Open-end Funds
Assets under management in open-end funds at December 31, 2020 were $35.2 billion, an increase of 12.0% from $31.4 billion at September 30, 2020. The change was primarily due to the following:
•Net inflows of $1.7 billion, including $1.2 billion into preferred securities and $484 million into U.S. real estate;
•Market appreciation of $2.4 billion, including $1.4 billion from U.S. real estate and $730 million from preferred securities; and
•Distributions of $348 million, including $157 million each from preferred securities and U.S. real estate.
Closed-end Funds
Assets under management in closed-end funds at December 31, 2020 were $11.5 billion, an increase of 31.8% from $8.7 billion at September 30, 2020. The increase was due to net inflows of $2.2 billion, including $2.1 billion from the Company's initial public offering of PTA, and market appreciation of $711 million, partially offset by distributions of $135 million.














6

Investment Performance as of December 31, 2020
q4investmentperformance1a.jpg
_________________________
(1)    Past performance is no guarantee of future results. Outperformance is determined by comparing the annualized investment performance of each investment strategy to the performance of specified reference benchmarks. Investment performance in excess of the performance of the benchmark is considered outperformance. The investment performance calculation of each investment strategy is based on all active accounts and investment models pursuing similar investment objectives. For accounts, actual investment performance is measured gross of fees and net of withholding taxes. For investment models, for which actual investment performance does not exist, the investment performance of a composite of accounts pursuing comparable investment objectives is used as a proxy for actual investment performance. The performance of the specified reference benchmark for each account and investment model is measured net of withholding taxes, where applicable. This is not investment advice and may not be construed as sales or marketing material for any financial product or service sponsored or provided by Cohen & Steers.
(2)    © 2021 Morningstar, Inc. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete, or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Morningstar calculates its ratings based on a risk-adjusted return measure that accounts for variation in a fund's monthly performance (including the effects of sales charges, loads, and redemption fees), placing more emphasis on downward variations and rewarding consistent performance. The top 10% of funds in each category receive five stars, the next 22.5% receive four stars, the next 35% receive three stars, the next 22.5% receive two stars and the bottom 10% receive one star. Past performance is no guarantee of future results. Based on independent rating by Morningstar, Inc. of investment performance of each Cohen & Steers-sponsored open-end U.S.-registered mutual fund for all share classes for the overall period at December 31, 2020. Overall Morningstar rating is a weighted average based on the 3-year, 5-year and 10-year Morningstar rating. Each share class is counted as a fraction of one fund within this scale and rated separately, which may cause slight variations in the distribution percentages. This is not investment advice and may not be construed as sales or marketing material for any financial product or service sponsored or provided by Cohen & Steers.

Balance Sheet Information
As of December 31, 2020, cash, cash equivalents, U.S. Treasury securities and seed investments were $143.0 million compared to $201.9 million as of September 30, 2020. The change was primarily due to the payment of $60.2 million for expenses associated with the initial public offering of PTA and the special dividend of $47.8 million, partially offset by funds from operations. As of December 31, 2020, stockholders' equity was $174.2 million and the Company had no debt.




7

Conference Call Information
Cohen & Steers will host a conference call tomorrow January 28, 2021 at 10:00 a.m. (ET) to discuss the Company’s fourth quarter and full year results. Investors and analysts can access the live conference call by dialing 800-895-8003 (U.S.) or +1-212-231-2901 (international); passcode: 21989586. Participants should plan to register at least 10 minutes before the conference call begins. The accompanying presentation will be available on the Company’s website at www.cohenandsteers.com under “Company—Investor Relations—Press Releases.”
A replay of the call will be available for two weeks starting at approximately 12:00 p.m. (ET) on January 28, 2021 and can be accessed at 800-633-8284 (U.S.) or +1-402-977-9140 (international); passcode: 21989586. Internet access to the webcast, which includes audio (listen-only), will be available on the Company's website at www.cohenandsteers.com under “Company—Investor Relations—Overview.” The webcast will be archived on the website for one month.
About Cohen & Steers
Cohen & Steers is a global investment manager specializing in liquid real assets, including real estate securities, listed infrastructure and natural resource equities, as well as preferred securities and other income solutions. Founded in 1986, the firm is headquartered in New York City, with offices in London, Dublin, Hong Kong and Tokyo.
Forward-Looking Statements
This press release and other statements that Cohen & Steers may make may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which reflect the Company's current views with respect to, among other things, the Company's operations and financial performance. You can identify these forward-looking statements by the use of words such as “outlook,” “believes,” “expects,” “potential,” “may,” “should,” “seeks,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or the negative versions of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these forward-looking statements. The Company believes that these factors include, but are not limited to, the risks described in the Risk Factors section of the Company's Annual Report on Form 10-K for the year ended December 31, 2019 (the Form 10-K) and Quarterly Reports on Form 10-Q for the quarters ended March 31, 2020, June 30, 2020 and September 30, 2020 (the First, Second and Third Quarter 10-Qs), each of which is accessible on the Securities and Exchange Commission's website at www.sec.gov and on the Company's website at www.cohenandsteers.com. These factors are not exhaustive and should be read in conjunction with the other cautionary statements that are included in the Company's Form 10-K, First, Second and Third Quarter 10-Qs, and other filings with the Securities and Exchange Commission. The Company undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.
# # # #
8


 Cohen & Steers, Inc. and Subsidiaries
 Condensed Consolidated Statements of Operations (Unaudited)
 (in thousands, except per share data)
 Three Months Ended % Change From
December 31, 2020September 30, 2020December 31, 2019September 30, 2020December 31, 2019
 Revenue
 Investment advisory and administration fees$107,940 $103,160 $101,157 
 Distribution and service fees7,849 7,572 7,976 
 Other671 427 714 
 Total revenue116,460 111,159 109,847 4.8 %6.0 %
 Expenses
 Employee compensation and benefits42,460 41,060 34,993 
 Distribution and service fees73,820 14,642 14,371 
 General and administrative10,966 11,006 12,942 
 Depreciation and amortization1,128 1,144 1,079 
 Total expenses128,374 67,852 63,385 89.2 %102.5 %
 Operating income (loss)(11,914)43,307 46,462 **
 Non-operating income (loss)
 Interest and dividend income—net626 694 1,542 
 Gain (loss) from investments—net7,315 3,279 1,463 
 Foreign currency gains (losses)—net(952)(742)(1,653)
 Total non-operating income (loss)6,989 3,231 1,352 **
 Income (loss) before provision for income taxes(4,925)46,538 47,814 **
 Provision (benefit) for income taxes(5,854)12,532 9,854 
 Net income929 34,006 37,960 (97.3 %)(97.6 %)
    Less: Net (income) loss attributable to redeemable noncontrolling interests
(5,341)(2,102)(1,232)
 Net income (loss) attributable to common stockholders$(4,412)$31,904 $36,728 **
 Earnings (loss) per share attributable to common stockholders
 Basic$(0.09)$0.67 $0.78 **
 Diluted$(0.09)$0.66 $0.75 **
 Dividends declared per share
 Quarterly$0.39 $0.39 $0.36 — %8.3 %
 Special$1.00 $— $2.00 *(50.0 %)
 Weighted average shares outstanding
 Basic47,867 47,855 47,324 
 Diluted48,857 48,681 48,703 
_________________________

*     Not meaningful.

9


 Cohen & Steers, Inc. and Subsidiaries
 Condensed Consolidated Statements of Operations (Unaudited)
 (in thousands, except per share data)
Year Ended
December 31, 2020December 31, 2019 % Change
 Revenue
 Investment advisory and administration fees$395,037 $378,578 
 Distribution and service fees30,134 30,048 
 Other2,365 2,204 
 Total revenue427,536 410,830 4.1 %
 Expenses
 Employee compensation and benefits156,457 143,431 
 Distribution and service fees115,084 55,237 
 General and administrative56,286 47,632 
 Depreciation and amortization4,652 4,396 
 Total expenses332,479 250,696 32.6 %
 Operating income (loss)95,057 160,134 (40.6 %)
 Non-operating income (loss)
 Interest and dividend income—net3,362 6,716 
 Gain (loss) from investments—net(4,116)21,673 
 Foreign currency gains (losses)—net(916)(974)
 Total non-operating income (loss)(1,670)27,415 *
 Income before provision for income taxes93,387 187,549 (50.2 %)
 Provision for income taxes18,222 40,565 
 Net income75,165 146,984 (48.9 %)
    Less: Net (income) loss attributable to redeemable noncontrolling interests
1,419 (12,363)
 Net income attributable to common stockholders$76,584 $134,621 (43.1 %)
 Earnings per share attributable to common stockholders
 Basic$1.60 $2.85 (43.7 %)
 Diluted$1.57 $2.79 (43.6 %)
 Dividends declared per share
 Quarterly$1.56 $1.44 8.3 %
 Special$1.00 $2.00 (50.0 %)
 Weighted average shares outstanding
 Basic47,800 47,273 
 Diluted48,676 48,297 
_________________________

*     Not meaningful.


10

Cohen & Steers, Inc. and Subsidiaries
Assets Under Management
By Investment Vehicle
(in millions)
Three Months Ended % Change From
December 31, 2020September 30, 2020December 31, 2019September 30, 2020December 31, 2019
Institutional Accounts
Assets under management, beginning of period$30,380 $28,867 $31,533 
    Inflows1,089 1,936 1,031 
    Outflows(1,097)(1,337)(901)
    Net inflows (outflows)(8)599 130 
    Market appreciation (depreciation)3,259 1,273 450 
    Distributions(376)(359)(308)
    Transfers— — 8 
    Total increase (decrease)2,875 1,513 280 
Assets under management, end of period$33,255 $30,380 $31,813 9.5 %4.5 %
Percentage of total assets under management41.6 %43.1 %44.1 %
Average assets under management$32,071 $30,325 $31,347 5.8 %2.3 %
Open-end Funds
Assets under management, beginning of period$31,404 $28,921 $29,598 
    Inflows3,996 4,020 3,588 
    Outflows(2,303)(2,398)(2,038)
    Net inflows (outflows)1,693 1,622 1,550 
    Market appreciation (depreciation)2,411 1,100 532 
    Distributions(348)(239)(947)
    Transfers— — (8)
    Total increase (decrease)3,756 2,483 1,127 
Assets under management, end of period$35,160 $31,404 $30,725 12.0 %14.4 %
Percentage of total assets under management44.0 %44.5 %42.6 %
Average assets under management$33,175 $30,694 $30,050 8.1 %10.4 %
Closed-end Funds
Assets under management, beginning of period$8,719 $8,539 $9,707 
    Inflows2,198 50 3 
    Outflows— (1)(80)
    Net inflows (outflows)2,198 49 (77)
    Market appreciation (depreciation)711 257 147 
    Distributions(135)(126)(133)
    Total increase (decrease)2,774 180 (63)
Assets under management, end of period$11,493 $8,719 $9,644 31.8 %19.2 %
Percentage of total assets under management14.4 %12.4 %13.4 %
Average assets under management$10,169 $8,777 $9,616 15.9 %5.8 %
Total
Assets under management, beginning of period$70,503 $66,327 $70,838 
    Inflows7,283 6,006 4,622 
    Outflows(3,400)(3,736)(3,019)
    Net inflows (outflows)3,883 2,270 1,603 
    Market appreciation (depreciation)6,381 2,630 1,129 
    Distributions(859)(724)(1,388)
    Total increase (decrease)9,405 4,176 1,344 
Assets under management, end of period$79,908 $70,503 $72,182 13.3 %10.7 %
Average assets under management$75,415 $69,796 $71,013 8.1 %6.2 %

11


Cohen & Steers, Inc. and Subsidiaries
Assets Under Management
By Investment Vehicle
(in millions)
Year Ended
December 31, 2020December 31, 2019 % Change
Institutional Accounts
Assets under management, beginning of period$31,813 $27,148 
    Inflows7,192 3,993 
    Outflows(4,418)(4,908)
    Net inflows (outflows)2,774 (915)
    Market appreciation (depreciation)53 6,873 
    Distributions(1,385)(1,306)
    Transfers— 13 
    Total increase (decrease)1,442 4,665 
Assets under management, end of period$33,255 $31,813 4.5 %
Percentage of total assets under management41.6 %44.1 %
Average assets under management$29,883 $30,301 (1.4 %)
Open-end Funds
Assets under management, beginning of period$30,725 $22,295 
    Inflows17,556 12,484 
    Outflows(12,135)(7,745)
    Net inflows (outflows)5,421 4,739 
    Market appreciation (depreciation)405 5,881 
    Distributions(1,391)(2,177)
    Transfers— (13)
    Total increase (decrease)4,435 8,430 
Assets under management, end of period$35,160 $30,725 14.4 %
Percentage of total assets under management44.0 %42.6 %
Average assets under management$30,152 $27,595 9.3 %
Closed-end Funds
Assets under management, beginning of period$9,644 $8,410 
    Inflows2,652 5 
    Outflows(89)(80)
    Net inflows (outflows)2,563 (75)
    Market appreciation (depreciation)(197)1,823 
    Distributions(517)(514)
    Total increase (decrease)1,849 1,234 
Assets under management, end of period$11,493 $9,644 19.2 %
Percentage of total assets under management14.4 %13.4 %
Average assets under management$9,140 $9,381 (2.6 %)
Total
Assets under management, beginning of period$72,182 $57,853 
    Inflows27,400 16,482 
    Outflows(16,642)(12,733)
    Net inflows (outflows)10,758 3,749 
    Market appreciation (depreciation)261 14,577 
    Distributions(3,293)(3,997)
    Total increase (decrease)7,726 14,329 
Assets under management, end of period$79,908 $72,182 10.7 %
Average assets under management$69,175 $67,277 2.8 %


12

Cohen & Steers, Inc. and Subsidiaries
Assets Under Management - Institutional Accounts
By Account Type
(in millions)
Three Months Ended % Change From
December 31, 2020September 30, 2020December 31, 2019September 30, 2020December 31, 2019
Advisory
Assets under management, beginning of period$16,093 $15,251 $15,243 
    Inflows645 1,142 338 
    Outflows(746)(1,036)(247)
    Net inflows (outflows)(101)106 91 
    Market appreciation (depreciation)1,636 736 335 
    Total increase (decrease)1,535 842 426 
Assets under management, end of period$17,628 $16,093 $15,669 9.5 %12.5 %
Percentage of institutional assets under management53.0 %53.0 %49.3 %
Average assets under management$17,167 $16,209 $15,380 5.9 %11.6 %
Japan Subadvisory
Assets under management, beginning of period$9,016 $8,736 $10,305 
    Inflows235 390 554 
    Outflows(152)(96)(213)
    Net inflows (outflows)83 294 341 
    Market appreciation (depreciation)997 345 (15)
    Distributions(376)(359)(308)
    Total increase (decrease)704 280 18 
Assets under management, end of period$9,720 $9,016 $10,323 7.8 %(5.8 %)
Percentage of institutional assets under management29.2 %29.7 %32.4 %
Average assets under management$9,337 $8,968 $10,142 4.1 %(7.9 %)
Subadvisory Excluding Japan
Assets under management, beginning of period$5,271 $4,880 $5,985 
    Inflows209 404 139 
    Outflows(199)(205)(441)
    Net inflows (outflows)10 199 (302)
    Market appreciation (depreciation)626 192 130 
    Transfers— — 8 
    Total increase (decrease)636 391 (164)
Assets under management, end of period$5,907 $5,271 $5,821 12.1 %1.5 %
Percentage of institutional assets under management17.8 %17.4 %18.3 %
Average assets under management$5,567 $5,148 $5,825 8.1 %(4.4 %)
Total Institutional Accounts
Assets under management, beginning of period$30,380 $28,867 $31,533 
    Inflows1,089 1,936 1,031 
    Outflows(1,097)(1,337)(901)
    Net inflows (outflows)(8)599 130 
    Market appreciation (depreciation)3,259 1,273 450 
    Distributions(376)(359)(308)
    Transfers— — 8 
    Total increase (decrease)2,875 1,513 280 
Assets under management, end of period$33,255 $30,380 $31,813 9.5 %4.5 %
Average assets under management$32,071 $30,325 $31,347 5.8 %2.3 %


13

Cohen & Steers, Inc. and Subsidiaries
Assets Under Management - Institutional Accounts
By Account Type
(in millions)
Year Ended
December 31, 2020December 31, 2019 % Change
Advisory
Assets under management, beginning of period$15,669 $12,065 
    Inflows4,324 1,918 
    Outflows(2,771)(1,351)
    Net inflows (outflows)1,553 567 
    Market appreciation (depreciation)406 3,032 
    Transfers— 5 
    Total increase (decrease)1,959 3,604 
Assets under management, end of period$17,628 $15,669 12.5 %
Percentage of institutional assets under management53.0 %49.3 %
Average assets under management$15,650 $14,752 6.1 %
Japan Subadvisory
Assets under management, beginning of period$10,323 $9,288 
    Inflows1,601 942 
    Outflows(626)(1,076)
    Net inflows (outflows)975 (134)
    Market appreciation (depreciation)(193)2,475 
    Distributions(1,385)(1,306)
    Total increase (decrease)(603)1,035 
Assets under management, end of period$9,720 $10,323 (5.8 %)
Percentage of institutional assets under management29.2 %32.4 %
Average assets under management$9,014 $9,954 (9.4 %)
Subadvisory Excluding Japan
Assets under management, beginning of period$5,821 $5,795 
    Inflows1,267 1,133 
    Outflows(1,021)(2,481)
    Net inflows (outflows)246 (1,348)
    Market appreciation (depreciation)(160)1,366 
    Transfers— 8 
    Total increase (decrease)86 26 
Assets under management, end of period$5,907 $5,821 1.5 %
Percentage of institutional assets under management17.8 %18.3 %
Average assets under management$5,219 $5,595 (6.7 %)
Total Institutional Accounts
Assets under management, beginning of period$31,813 $27,148 
    Inflows7,192 3,993 
    Outflows(4,418)(4,908)
    Net inflows (outflows)2,774 (915)
    Market appreciation (depreciation)53 6,873 
    Distributions(1,385)(1,306)
    Transfers— 13 
    Total increase (decrease)1,442 4,665 
Assets under management, end of period$33,255 $31,813 4.5 %
Average assets under management$29,883 $30,301 (1.4 %)



14

Cohen & Steers, Inc. and Subsidiaries
Assets Under Management
By Investment Strategy
(in millions)
Three Months Ended % Change From
December 31, 2020September 30, 2020December 31, 2019September 30, 2020December 31, 2019
U.S. Real Estate
Assets under management, beginning of period$29,610 $28,119 $30,964 
    Inflows2,204 2,827 2,405 
    Outflows(1,292)(1,733)(1,355)
    Net inflows (outflows)912 1,094 1,050 
    Market appreciation (depreciation)2,886 882 11 
    Distributions(573)(485)(1,001)
    Transfers(8)— — 
    Total increase (decrease)3,217 1,491 60 
Assets under management, end of period$32,827 $29,610 $31,024 10.9 %5.8 %
Percentage of total assets under management41.1 %42.0 %43.0 %
Average assets under management$31,203 $29,442 $30,694 6.0 %1.7 %
Preferred Securities
Assets under management, beginning of period$19,010 $17,116 $16,749 
    Inflows4,281 2,167 1,320 
    Outflows(992)(941)(767)
    Net inflows (outflows)3,289 1,226 553 
    Market appreciation (depreciation)1,070 844 440 
    Distributions(192)(176)(161)
    Transfers8 — — 
    Total increase (decrease)4,175 1,894 832 
Assets under management, end of period$23,185 $19,010 $17,581 22.0 %31.9 %
Percentage of total assets under management29.0 %27.0 %24.4 %
Average assets under management$21,096 $18,255 $17,112 15.6 %23.3 %
Global/International Real Estate
Assets under management, beginning of period$13,863 $12,659 $13,141 
    Inflows416 851 629 
    Outflows(677)(379)(488)
    Net inflows (outflows)(261)472 141 
    Market appreciation (depreciation)1,648 740 385 
    Distributions(36)(8)(158)
    Total increase (decrease)1,351 1,204 368 
Assets under management, end of period$15,214 $13,863 $13,509 9.7 %12.6 %
Percentage of total assets under management19.0 %19.7 %18.7 %
Average assets under management$14,612 $13,520 $13,330 8.1 %9.6 %


15

Cohen & Steers, Inc. and Subsidiaries
Assets Under Management
By Investment Strategy - continued
(in millions)
Three Months Ended % Change From
December 31, 2020September 30, 2020December 31, 2019September 30, 2020December 31, 2019
Global Listed Infrastructure
Assets under management, beginning of period$6,299 $6,768 $7,774 
    Inflows316 139 219 
    Outflows(399)(655)(285)
    Net inflows (outflows)(83)(516)(66)
    Market appreciation (depreciation)562 93 194 
    Distributions(49)(46)(52)
    Transfers— — 226 
    Total increase (decrease)430 (469)302 
Assets under management, end of period$6,729 $6,299 $8,076 6.8 %(16.7 %)
Percentage of total assets under management8.4 %8.9 %11.2 %
Average assets under management$6,665 $6,839 $7,671 (2.5 %)(13.1 %)
Other
Assets under management, beginning of period$1,721 $1,665 $2,210 
    Inflows66 22 49 
    Outflows(40)(28)(124)
    Net inflows (outflows)26 (6)(75)
    Market appreciation (depreciation)215 71 99 
    Distributions(9)(9)(16)
    Transfers— — (226)
    Total increase (decrease)232 56 (218)
Assets under management, end of period$1,953 $1,721 $1,992 13.5 %(2.0 %)
Percentage of total assets under management2.4 %2.4 %2.8 %
Average assets under management$1,839 $1,740 $2,206 5.7 %(16.6 %)
Total
Assets under management, beginning of period$70,503 $66,327 $70,838 
    Inflows7,283 6,006 4,622 
    Outflows(3,400)(3,736)(3,019)
    Net inflows (outflows)3,883 2,270 1,603 
    Market appreciation (depreciation)6,381 2,630 1,129 
    Distributions(859)(724)(1,388)
    Total increase (decrease)9,405 4,176 1,344 
Assets under management, end of period$79,908 $70,503 $72,182 13.3 %10.7 %
Average assets under management$75,415 $69,796 $71,013 8.1 %6.2 %



16

Cohen & Steers, Inc. and Subsidiaries
Assets Under Management
By Investment Strategy
(in millions)
Year Ended
December 31, 2020December 31, 2019 % Change
U.S. Real Estate
Assets under management, beginning of period$31,024 $24,627 
    Inflows11,114 7,298 
    Outflows(6,478)(5,363)
    Net inflows (outflows)4,636 1,935 
    Market appreciation (depreciation)(574)7,346 
    Distributions(2,282)(2,886)
    Transfers23 2 
    Total increase (decrease)1,803 6,397 
Assets under management, end of period$32,827 $31,024 5.8 %
Percentage of total assets under management41.1 %43.0 %
Average assets under management$28,972 $29,117 (0.5 %)
Preferred Securities
Assets under management, beginning of period$17,581 $13,068 
    Inflows10,979 5,726 
    Outflows(5,828)(3,041)
    Net inflows (outflows)5,151 2,685 
    Market appreciation (depreciation)1,172 2,406 
    Distributions(696)(597)
    Transfers(23)19 
    Total increase (decrease)5,604 4,513 
Assets under management, end of period$23,185 $17,581 31.9 %
Percentage of total assets under management29.0 %24.4 %
Average assets under management$18,278 $15,702 16.4 %
Global/International Real Estate
Assets under management, beginning of period$13,509 $11,047 
    Inflows4,122 2,541 
    Outflows(2,436)(2,714)
    Net inflows (outflows)1,686 (173)
    Market appreciation (depreciation)102 2,887 
    Distributions(83)(252)
    Total increase (decrease)1,705 2,462 
Assets under management, end of period$15,214 $13,509 12.6 %
Percentage of total assets under management19.0 %18.7 %
Average assets under management$13,193 $12,718 3.7 %




17

Cohen & Steers, Inc. and Subsidiaries
Assets Under Management
By Investment Strategy - continued
(in millions)
Year Ended
December 31, 2020December 31, 2019 % Change
Global Listed Infrastructure
Assets under management, beginning of period$8,076 $6,517 
    Inflows997 713 
    Outflows(1,722)(699)
    Net inflows (outflows)(725)14 
    Market appreciation (depreciation)(423)1,520 
    Distributions(199)(201)
    Transfers— 226 
    Total increase (decrease)(1,347)1,559 
Assets under management, end of period$6,729 $8,076 (16.7 %)
Percentage of total assets under management8.4 %11.2 %
Average assets under management$6,972 $7,455 (6.5 %)
Other
Assets under management, beginning of period$1,992 $2,594 
    Inflows188 204 
    Outflows(178)(916)
    Net inflows (outflows)10 (712)
    Market appreciation (depreciation)(16)418 
    Distributions(33)(61)
    Transfers— (247)
    Total increase (decrease)(39)(602)
Assets under management, end of period$1,953 $1,992 (2.0 %)
Percentage of total assets under management2.4 %2.8 %
Average assets under management$1,760 $2,285 (23.0 %)
Total
Assets under management, beginning of period$72,182 $57,853 
    Inflows27,400 16,482 
    Outflows(16,642)(12,733)
    Net inflows (outflows)10,758 3,749 
    Market appreciation (depreciation)261 14,577 
    Distributions(3,293)(3,997)
    Total increase (decrease)7,726 14,329 
Assets under management, end of period$79,908 $72,182 10.7 %
Average assets under management$69,175 $67,277 2.8 %



18

Non-GAAP Reconciliations
Management believes that use of the following non-GAAP financial measures enhances the evaluation of the Company's results, as they provide greater transparency into the Company's operating performance. In addition, these non-GAAP financial measures are used to prepare the Company's internal management reports and are used by management in evaluating the Company's business.
While management believes that this non-GAAP financial information is useful in evaluating the Company's results and operating performance, this information should be considered as supplemental in nature and not as a substitute for the related financial information prepared in accordance with U.S. GAAP.
Reconciliation of U.S. GAAP Net Income (Loss) Attributable to Common Stockholders and U.S. GAAP Earnings per Share to Net Income Attributable to Common Stockholders, As Adjusted, and Earnings per Share, As Adjusted
(in thousands, except per share data) Three Months EndedYear Ended
December 31, 2020September 30, 2020December 31, 2019December 31, 2020December 31, 2019
Net income (loss) attributable to common stockholders, U.S. GAAP$(4,412)$31,904 $36,728 $76,584 $134,621 
Seed investments (1)
(2,574)(1,686)(1,393)1,443 (11,858)
Accelerated vesting of restricted stock units
387 387 358 774 1,344 
Initial public offering costs (2)
60,249 310 — 60,559 — 
Rights offering costs (3)
— — 346 11,859 346 
Other non-recurring expenses (4)
500 — — 500 — 
Foreign currency exchange (gains) losses—net (5)
1,683 1,232 2,822 871 1,909 
Tax adjustments (6)
(18,751)469 (2,864)(27,299)(2,002)
Net income attributable to common stockholders, as adjusted$37,082 $32,616 $35,997 $125,291 $124,360 
Diluted weighted average shares outstanding48,857 48,681 48,703 48,676 48,297 
Diluted earnings (loss) per share, U.S. GAAP$(0.09)$0.66 $0.75 $1.57 $2.79 
Seed investments
(0.05)(0.04)(0.03)0.03 (0.25)
Accelerated vesting of restricted stock units
0.01 0.01 0.01 0.02 0.02 
Initial public offering costs1.23 0.01 — 1.24 — 
Rights offering costs
— — 0.01 0.24 0.01 
Other non-recurring expenses0.01 — — 0.01 — 
Foreign currency exchange (gains) losses—net
0.03 0.02 0.06 0.02 0.04 
Tax adjustments
(0.38)0.01 (0.06)(0.56)(0.04)
Diluted earnings per share, as adjusted $0.76 $0.67 $0.74 $2.57 $2.57 
_________________________
(1)    Represents amounts related to the deconsolidation of seed investments in Company-sponsored funds as well as non-operating (income) loss from seed investments that were not consolidated.
(2)    Represents costs associated with the initial public offering of PTA. Costs are summarized in the following table:
Employee compensation and benefits
$1,317 $— $— $1,317 $— 
Distribution and service fees
57,818 — — 57,818 — 
General and administrative1,114 310 — 1,424 — 
Initial public offering costs
$60,249 $310 $— $60,559 $— 
(3) Represents costs associated with the Cohen & Steers Quality Income Realty Fund, Inc. (RQI) rights offering which were recorded in general and administrative expense in the first quarter of 2020 and fourth quarter of 2019.
(4) Represents other non-recurring expenses which were recorded in distribution and service fees.
(5)    Represents net foreign currency exchange (gains) losses associated with U.S. dollar-denominated assets held by certain foreign subsidiaries.
(6)    Tax adjustments are summarized in the following table:
Discrete tax items
$(4,435)$62 $(1,837)$(10,180)$(2,040)
Tax effect of non-GAAP adjustments
(14,316)407 (1,027)(17,119)38 
Total tax adjustments
$(18,751)$469 $(2,864)$(27,299)$(2,002)

19

Reconciliation of U.S. GAAP Operating Income and U.S. GAAP Operating Margin to Operating Income, As Adjusted, and Operating Margin, As Adjusted
(in thousands, except percentages) Three Months EndedYear Ended
December 31, 2020September 30, 2020December 31, 2019December 31, 2020December 31, 2019
Revenue, U.S. GAAP$116,460 $111,159 $109,847 $427,536 $410,830 
Seed investments (1)
95 275 (19)281 (438)
Revenue, as adjusted$116,555 $111,434 $109,828 $427,817 $410,392 
Expenses, U.S. GAAP$128,374 $67,852 $63,385 $332,479 $250,696 
Seed investments (1)
(69)102 (224)(424)(1,323)
Accelerated vesting of restricted stock units
(387)(387)(358)(774)(1,344)
Initial public offering costs (2)
(60,249)(310)— (60,559)— 
Rights offering costs (3)
— — (346)(11,859)(346)
Other non-recurring expenses (4)
(500)— — (500)— 
Expenses, as adjusted$67,169 $67,257 $62,457 $258,363 $247,683 
Operating income (loss), U.S. GAAP$(11,914)$43,307 $46,462 $95,057 $160,134 
Seed investments (1)
164 173 205 705 885 
Accelerated vesting of restricted stock units
387 387 358 774 1,344 
Initial public offering costs (2)
60,249 310 — 60,559 — 
Rights offering costs (3)
— — 346 11,859 346 
Other non-recurring expenses (4)
500 — — 500 — 
Operating income, as adjusted$49,386 $44,177 $47,371 $169,454 $162,709 
Operating margin, U.S. GAAP(10.2)%39.0 %42.3 %22.2 %39.0 %
Operating margin, as adjusted 42.4 %39.6 %43.1 %39.6 %39.6 %
_________________________

(1)    Represents amounts related to the deconsolidation of seed investments in Company-sponsored funds as well as non-operating (income) loss from seed investments that were not consolidated.
(2)    Represents costs associated with the initial public offering of PTA. Costs are summarized in the following table:
Employee compensation and benefits
$1,317 $— $— $1,317 $— 
Distribution and service fees
57,818 — — 57,818 — 
General and administrative1,114 310 — 1,424 — 
Initial public offering costs
$60,249 $310 $— $60,559 $— 

(3)    Represents costs associated with RQI rights offering which were recorded in general and administrative expense in the first quarter of 2020 and fourth quarter of 2019.
(4)    Represents other non-recurring expenses which were recorded in distribution and service fees.


Reconciliation of U.S. GAAP Non-operating Income (Loss) to Non-operating Income (Loss), As Adjusted
(in thousands) Three Months EndedYear Ended
December 31, 2020September 30, 2020December 31, 2019December 31, 2020December 31, 2019
Non-operating income (loss), U.S. GAAP$6,989 $3,231 $1,352 $(1,670)$27,415 
Seed investments (1)
(8,079)(3,961)(2,830)2,157 (25,106)
Foreign currency exchange (gain) loss—net (2)
1,683 1,232 2,822 871 1,909 
Non-operating income (loss), as adjusted$593 $502 $1,344 $1,358 $4,218 
_________________________

(1)    Represents amounts related to the deconsolidation of seed investments in Company-sponsored funds as well as non-operating (income) loss from seed investments that were not consolidated.
(2)    Represents net foreign currency exchange (gains) losses associated with U.S. dollar-denominated assets held by certain foreign subsidiaries.

20