GAMCO Investors, Inc. Reports Record Third Quarter Earnings

GAMCO Investors, Inc. (GAMCO) (NYSE:GBL) today reported third quarter 2018 revenues of $85.8 million, net income of $35.0 million, and earnings of $1.22 per diluted share. This compares to third quarter 2017 revenues of $88.3 million, net income of $16.6 million, and earnings of $0.55 per diluted share.

In July 2018, GAMCOs investment grade rating was reaffirmed by Standard and Poors with a stable outlook. This reflects our strong financial condition.

Average AUM was $41.0 billion for the third quarter of 2018 versus $42.3 billion for the third quarter of 2017 and $40.6 billion for the second quarter of 2018.

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Our firm has long held the belief that generating returns for our stakeholders, while important, is not the only factor in measuring our corporate success. The importance of the way we and others conduct business is a key facet of our principles. As evidence of this, we have been involved in the field of responsible investing since 1987. In our program of corporate giving, our shareholder designated charitable contribution program, GAMCO shareholders select which organizations will be recipients of charitable grants. This year, the majority of our shareholders registered their shares and were eligible to designate a 501(c)(3) organization. With this years $4.9 million distribution, we have donated more than $22 million to over 150 charities across the United States since the inception of this program in 2013 which brings the total charitable contributions since our IPO to $47 million. On November 6, 2018, the Board declared an additional $0.20 per share shareholder designated charitable contribution to registered shareholders of record as of December 31, 2018.

Revenues

  • Total revenues for the third quarter of 2018 were $85.8 million compared to $88.3 million in the prior year.
  • Investment advisory fees were $75.9 million in the third quarter versus $77.3 million in the third quarter of 2017. Open-end and closed-end fund revenues were unchanged at $50.0 million in the third quarter. Institutional and Private Wealth Management revenues were $24.3 million compared to $26.0 million in 2017. SICAV revenues increased to $1.6 million from $1.3 million in the prior year quarter.
  • Distribution fees from our open-end equity funds and other income were $9.9 million for the third quarter of 2018 versus $11.0 million in the prior-year quarter.
               
Financial Highlights
Third Quarter YTD
($’s in 000’s except AUM and per share data) 2018 2017 2018 2017
 
AUM – average (in millions) $ 41,037 $ 42,323 $ 41,341 $ 41,696
AUM – end of period (in millions) 40,646 43,089 40,646 43,089
                                 
 
Revenues $ 85,788 $ 88,341 $ 260,478 $ 261,858
 
Operating income 51,700 23,393 134,329 105,496
 
Income before income taxes 46,436 20,434 124,023 98,002
Effective tax rate 24.6% 18.8% 24.3% 34.4%
 
Net income 35,016 16,600 93,859 64,314
 
Net income per fully diluted share   $ 1.22       $ 0.55       $ 3.26       $ 2.14    
 
Weighted average diluted shares outstanding 28,739 31,173 28,824 31,144
 
Shares outstanding at September 30, 29,066 29,168 29,066 29,168
 

Operating Income

Operating income was $51.7 million in the third quarter of 2018 versus $23.4 million in the prior-year period. Lower amortization of deferred compensation, a non-cash charge, impacted operating costs by $9.6 million. The previously announced waiver of CEO compensation beginning March 1, 2018 boosted third quarter operating income by $17.8 million. Excluding GAAP treatment of the deferral, but reflecting the lower compensation expense due to the waiver, adjusted operating income was $51.9 million in the third quarter of 2018 versus $33.2 million in the year-ago quarter. See pages 10 and 11 for a reconciliation of GAAP operating income to this adjusted operating income.

Other income/(expense), net

Mark to market investment losses were $3.8 million in the third quarter of 2018 versus gains of $3.6 million in the prior year quarter. Interest expense for the three months was $1.9 million lower at $0.8 million versus $2.7 million in the year ago quarter. This reflects the lower balance and repayment of the 4% PIK note.

Income Taxes

The Companys effective tax rate (ETR) for the quarter ended September 30, 2018 was 24.6% versus 18.8% for the quarter ended September 30, 2017. The prior year quarters ETR benefited from the reversal of certain tax accruals totaling $3.6 million. Absent this reversal the ETR was 36.2%.

Business Highlights

  • On August 21, 2018, we announced that Ian Lapey joined us as portfolio manager for the newly registered Gabelli Global Financial Services Fund. The Fund launched on October 1, 2018. Ian was a Partner, Research Analyst, and Portfolio Manager at Third Avenue Management, after which he joined Moerus Capital Management LLC. In 2009 he was appointed Co-Manager of the firms flagship Third Avenue Value Fund, and was subsequently named sole Portfolio Manager of that fund in 2012.
  • We also launched the Gabelli Global Mini Mites Fund. The fund will invest on a global basis in equity securities that have a market capitalization of $250 million or less.
  • On August 27, 2018, Trevor, Stewart, Burton & Jacobson (TSB&J), an RIA firm, agreed to assign their private wealth clients to GAMCO Asset Management. Carl Kempner, Jr. and Melody Bryant joined GAMCO to manage the portfolios for the former TSB&J clients.
  • On September 28, 2018, Fitch Ratings gave the Gabelli U.S. Treasury Fund its highest rating, AAAmmf.

Balance Sheet

We ended the quarter with cash and investments of $60.0 million and debt of $24.2 million. We note that there is $50.0 million, net of a $16.7 million tax benefit, still payable in deferred compensation.

Returns to Shareholder

We distributed $0.6 million in dividends during the quarter ended September 30, 2018 and we purchased 86,333 shares at an average price of $25.99 per share for a total investment of $2.2 million. Since our IPO in February 1999, we have returned $2.0 billion to shareholders consisting of $1.0 billion of spin-offs, $492.8 million in the form of dividends, and $462.2 million through stock buybacks of approximately 10.7 million shares.

On November 6, 2018, GAMCOs Board of Directors declared a regular quarterly dividend of $0.02 per share payable on January 15, 2019 to its Class A and Class B shareholders of record on January 2, 2019.

About GAMCO Investors, Inc.

GAMCO Investors, Inc., through its subsidiaries, manages open-end funds and closed-end funds (Gabelli Funds, LLC) and private advisory accounts (GAMCO Asset Management Inc.).

The Company reported Assets Under Management as follows (in millions):

  September 30,   September 30,
2018 2017
Equities:
Open-end Funds $ 12,799 $ 13,762
Closed-end Funds 7,895 7,668
Institutional & PWM – direct (a) 11,940 13,893
Institutional & PWM – sub-advisory 5,434 5,346
SICAV   548   504
Total Equities   38,616   41,173
Fixed Income:
100% U.S. Treasury Fund 2,004 1,890
Institutional & PWM   26   26
Total Fixed Income   2,030   1,916
Total Assets Under Management $ 40,646 $ 43,089
(a)   Includes $324 million and $280 million of 100% U.S. Treasury Fund AUM at September 30, 2018 and September 30, 2017, respectively.
 
     
Table I: Fund Flows – 3rd Quarter 2018
    Fund
Market distributions,
June 30, appreciation/ Net cash net of September 30,
2018 (depreciation) flows reinvestments 2018
Equities:
Open-end Funds $ 12,906 $ 480 $ (566 ) $ (21 ) $ 12,799
Closed-end Funds 7,778 252 (9 ) (126 ) 7,895
Institutional & PWM – direct 11,982 418 (460 ) 11,940
Institutional & PWM – sub-advisory 5,459 55 (80 ) 5,434
SICAV   559   1   (12 )       548
Total Equities   38,684   1,206   (1,127 )   (147 )   38,616
Fixed Income:
100% U.S. Treasury Fund 1,961 10 33 2,004
Institutional & PWM   26             26
Total Fixed Income   1,987   10   33         2,030
Total Assets Under Management $ 40,671 $ 1,216 $ (1,094 ) $ (147 ) $ 40,646
 
       
Table II: Fund Flows – Year to date September 30, 2018
  Fund
Market distributions,
December 31, appreciation/ Net cash net of September 30,
2017 (depreciation) flows reinvestments 2018
Equities:
Open-end Funds $ 13,747 $ 503 $ (1,413 ) $ (38 ) $ 12,799
Closed-end Funds 8,053 269 (47 ) (380 ) 7,895
Institutional & PWM – direct 13,420 227 (1,707 ) 11,940
Institutional & PWM – sub-advisory 5,432 122 (120 ) 5,434
SICAV   510   (14 )   52         548
Total Equities   41,162   1,107     (3,235 )   (418 )   38,616
Fixed Income:
100% U.S. Treasury Fund 1,870 24 110 2,004
Institutional & PWM   31   1     (6 )       26
Total Fixed Income   1,901   25     104         2,030
Total Assets Under Management $ 43,063 $ 1,132   $ (3,131 ) $ (418 ) $ 40,646
 
   
Table III
 
GAMCO INVESTORS, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share data)
 
For the Quarter Ended
September 30,
2018 2017
 
Investment advisory and incentive fees $ 75,934 $ 77,328
Distribution fees and other income   9,854     11,013  
Total revenues 85,788 88,341
 
Compensation costs 17,562 42,919
Distribution costs 9,819 11,665
Other operating expenses   5,258     5,429  
Total expenses 32,639 60,013
 
Operating income before management fee 53,149 28,328
 
Investment income (3,797 ) 3,586
Interest expense (759 ) (2,688 )
Shareholder-designated contribution   (708 )   (3,857 )
Other expense, net   (5,264 )   (2,959 )
 
Income before management fee and income taxes 47,885 25,369
Management fee expense   1,449     4,935  
Income before income taxes 46,436 20,434
Income tax expense   11,420     3,834  
Net income attributable to GAMCO Investors, Inc. $ 35,016   $ 16,600  
 
Net income per share attributable to GAMCO Investors, Inc.:
Basic $ 1.22   $ 0.57  
 
Diluted $ 1.22   $ 0.55  
 
Weighted average shares outstanding:
Basic   28,677     28,926  
 
Diluted   28,739     31,173  
 
Actual shares outstanding (a)   29,066     29,168  
Notes:
(a) Includes 434,750 and 164,050 of RSAs, respectively.
 
See GAAP to non-GAAP reconciliation on page 8.
 
   
Table IV
 
GAMCO INVESTORS, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share data)
 
For the Nine Months Ended
September 30,
2018 2017
 
Investment advisory and incentive fees $ 230,616 $ 228,942
Distribution fees and other income   29,862     32,916  
Total revenues 260,478 261,858
 
Compensation costs 72,464 97,634
Distribution costs 29,875 33,373
Other operating expenses   16,245     15,900  
Total expenses 118,584 146,907
 
Operating income before management fee 141,894 114,951
 
Investment income (6,541 ) 4,632
Interest expense (2,881 ) (8,269 )
Shareholder-designated contribution   (884 )   (3,857 )
Other expense, net   (10,306 )   (7,494 )
 
Income before management fee and income taxes 131,588 107,457
Management fee expense   7,565     9,455  
Income before income taxes 124,023 98,002
Income tax expense   30,164     33,688  
Net income attributable to GAMCO Investors, Inc. $ 93,859   $ 64,314  
 
Net income per share attributable to GAMCO Investors, Inc.:
Basic $ 3.26   $ 2.22  
 
Diluted $ 3.26   $ 2.14  
 
Weighted average shares outstanding:
Basic   28,789     28,930  
 
Diluted   28,824     31,144  
 
Actual shares outstanding (a)   29,066     29,168  
Notes:
(a) Includes 434,750 and 164,050 of RSAs, respectively.
 
See GAAP to non-GAAP reconciliation on page 8.
 
                 
Table V
GAMCO INVESTORS, INC.
UNAUDITED QUARTERLY CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share data)
 
2018 2017
1st 2nd 3rd 1st 2nd 3rd 4th
Quarter Quarter Quarter Year to Date Quarter Quarter Quarter Quarter Full Year
Income Statement Data:
 
Revenues $ 87,497 $ 87,193 $ 85,788 $ 260,478 $ 85,917 $ 87,600 $ 88,341 $ 98,666 $ 360,524
 
Expenses   41,607     44,338     32,639     118,584     41,310     45,584     60,013     54,931     201,838  
 
Operating income before
management fee 45,890 42,855 53,149 141,894 44,607 42,016 28,328 43,735 158,686
 
Investment income (4,855 ) 2,111 (3,797 ) (6,541 ) 509 537 3,586 (2,467 ) 2,165
Interest expense (1,200 ) (922 ) (759 ) (2,881 ) (2,832 ) (2,749 ) (2,688 ) (1,891 ) (10,160 )
Shareholder-designated contribution       (176 )   (708 )   (884 )           (3,857 )   (280 )   (4,137 )
Other income/(expense), net (6,055 ) 1,013 (5,264 ) (10,306 ) (2,323 ) (2,212 ) (2,959 ) (4,638 ) (12,132 )
 
Income before management
fee and income taxes 39,835 43,868 47,885 131,588 42,284 39,804 25,369 39,097 146,554
Management fee expense   4,634     1,482     1,449     7,565     2,164     2,356     4,935     4,211     13,666  
Income before income taxes 35,201 42,386 46,436 124,023 40,120 37,448 20,434 34,886 132,888
Income tax expense   7,940     10,804     11,420     30,164     15,300     14,554     3,834     21,391     55,079  
Net income attributable to
GAMCO Investors, Inc. $ 27,261   $ 31,582   $ 35,016   $ 93,859   $ 24,820   $ 22,894   $ 16,600   $ 13,495   $ 77,809  
 
Net income per share
attributable to GAMCO
Investors, Inc.:
Basic $ 0.94   $ 1.10   $ 1.22   $ 3.26   $ 0.86   $ 0.79   $ 0.57   $ 0.46   $ 2.68  
 
Diluted $ 0.94   $ 1.10   $ 1.22   $ 3.26   $ 0.82   $ 0.76   $ 0.55   $ 0.46   $ 2.60  
 
Weighted average shares outstanding:
Basic   28,916     28,777     28,677     28,789     28,970     28,896     28,926     29,103     28,980  
 
Diluted   28,916     28,819     28,739     28,824     31,160     31,100     31,173     30,336     30,947  
 
Reconciliation of non-GAAP
financial measures to GAAP:
Operating income before
management fee 45,890 42,855 53,149 141,894 44,607 42,016 28,328 43,735 158,686
Deduct: management fee expense   4,634     1,482     1,449     7,565     2,164     2,356     4,935     4,211     13,666  
Operating income $ 41,256   $ 41,373   $ 51,700   $ 134,329   $ 42,443   $ 39,660   $ 23,393   $ 39,524   $ 145,020  
 
Operating margin before
management fee   52.4 %   49.1 %   62.0 %   54.5 %   51.9 %   48.0 %   32.1 %   44.3 %   44.0 %
Operating margin after
management fee   47.2 %   47.4 %   60.3 %   51.6 %   49.4 %   45.3 %   26.5 %   40.1 %   40.2 %
 
Notes on Non-GAAP Financial Measures:
Operating income before management fee is used by management to evaluate its business operations. We believe this measure is useful in illustrating the operating results of GAMCO Investors, Inc. (the “Company”) as management fee expense is based on pre-tax income before management fee expense, which includes non-operating items including investment gains and losses from the Company’s proprietary investment portfolio and interest expense.
 
   
Table VI
GAMCO INVESTORS, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Dollars in thousands, except per share data)
 
September 30, December 31,
2018 2017
 
ASSETS
 
Cash and cash equivalents $ 34,334 $ 17,821
Investments 29,704 36,790
Receivable from brokers 2,654 1,578
Other receivables 30,616 45,621
Deferred tax asset and income tax receivable 11,532 15,615
Other assets   9,617     10,861  
 
Total assets $ 118,457   $ 128,286  
 
LIABILITIES AND EQUITY
 
Payable to brokers $ $ 14,926
Income taxes payable and deferred tax liabilities 3,555 3,128
Compensation payable (a) 70,385 82,907
Accrued expenses and other liabilities   32,545     34,454  
Sub-total 106,485 135,415
 
5.875% Senior notes (due June 1, 2021) 24,162 24,144
4% PIK note (due November 30, 2020) 50,000
1.6% AC Note (due February 28, 2018)       15,000  
Total debt   24,162     89,144  
Total liabilities 130,647 224,559
 
GAMCO Investors, Inc.’s stockholders’ deficit   (12,190 )   (96,273 )
 
Total liabilities and equity $ 118,457   $ 128,286  

(a) Excludes $21.1 million and $59.0 million of DCCA expense that is not yet recorded under GAAP as of September 30, 2018 and December 31, 2017, respectively.

 

Non-GAAP information and reconciliation:

GAMCOs non-GAAP measures include adjusted operating income, adjusted income before taxes, adjusted effective tax rate, adjusted net income and adjusted net income per fully diluted share. GAMCOs calculation of these non-GAAP measures may not be comparable to similarly titled measures of other companies due to potential differences between companies in the method of calculation. As a result, the use of these non-GAAP measures has limitations and should not be considered superior to, in isolation from, or a substitute for, related U.S. GAAP measures.

These non-GAAP measures allow management and investors to view operating trends, perform analytical comparisons and benchmark performance between periods to understand operating performance without regard to items that we do not consider to be a component of our core operating performance. Management uses these measures in its financial, investment and operational decision-making processes, for internal reporting and as part of its forecasting and budgeting processes. For these reasons we believe these non-GAAP measures are useful for our investors.

Adjusted operating income, adjusted income before taxes, adjusted effective tax rate, adjusted net income and adjusted net income per fully diluted share can be used by investors to review our results on a consistent basis. Examples of adjustments to these measures include the GAAP impact of the 2016 Deferred Cash Compensation Agreement (DCCA), First Half 2017 DCCA, and the Fourth Quarter 2017 DCCA that were put in place to enable the Company to more quickly pay down its debt.

The following tables reconcile adjusted income before taxes, adjusted effective tax rate, adjusted net income and adjusted net income per share to their closest GAAP equivalent:

  For the three months ended September 30, 2018
  Impact of   Impact of    
Reported Fourth Quarter First Half Impact of
GAAP 2017 DCCA 2017 DCCA 2016 DCCA Adjusted
 
Total revenues $ 85,788 $ $ $ $ 85,788
 
Compensation costs 17,562 (766 ) (441 ) 2,474 18,829
Distribution costs 9,819 9,819
Other operating expenses   5,258                 5,258  
Total expenses 32,639 (766 ) (441 ) 2,474 33,906
 
Operating income before management fee 53,149 766 441 (2,474 ) 51,882
 
Other income/(expense), net (5,264 ) (5,264 )
 
Income before management fee and income taxes 47,885 766 441 (2,474 ) 46,618
Management fee expense   1,449     (419 )       (1,030 )    
Income before income taxes 46,436 1,185 441 (1,444 ) 46,618
Income tax expense   11,420     296     110     (361 )   11,465  
Net income attributable to GAMCO Investors, Inc. $ 35,016   $ 889   $ 331   $ (1,083 ) $ 35,153  
 
Net income per share attributable to GAMCO Investors, Inc.:
Basic $ 1.22   $ 0.03   $ 0.01   $ (0.04 ) $ 1.23  
Diluted $ 1.22   $ 0.03   $ 0.01   $ (0.04 ) $ 1.22  
 
Reconciliation of non-GAAP financial measures to GAAP:
 
Operating income before management fee $ 53,149 $ 766 $ 441 $ (2,474 ) $ 51,882
Deduct: management fee expense   (1,449 )   419         1,030      
Operating income $ 51,700   $ 1,185   $ 441   $ (1,444 ) $ 51,882  
 
   
For the three months ended September 30, 2017
   
Reported First Half
GAAP 2017 DCCA 2016 DCCA Adjusted
 
Total revenues $ 88,341 $ $ $ 88,341
 
Compensation costs 42,919 (4,816 ) (3,415 ) 34,688
Distribution costs 11,665 11,665
Other operating expenses   5,429             5,429  
Total expenses 60,013 (4,816 ) (3,415 ) 51,782
 
Operating income before management fee 28,328 4,816 3,415 36,559
 
Other expense, net (2,959 ) (2,959 )
 
Income before management fee and income taxes 25,369 4,816 3,415 33,600
Management fee expense   4,935     (886 )   (688 )   3,361  
Income before income taxes 20,434 5,702 4,103 30,239
Income tax expense   3,834     2,167     1,559     7,560  
Net income attributable to GAMCO Investors, Inc. $ 16,600   $ 3,535   $ 2,544   $ 22,679  
 
Net income per share attributable to GAMCO Investors, Inc.:
Basic $ 0.57   $ 0.12   $ 0.09   $ 0.78  
Diluted $ 0.55   $ 0.11   $ 0.08   $ 0.75  
 
Reconciliation of non-GAAP financial measures to GAAP:
 
Operating income before management fee $ 28,328 $ 4,816 $ 3,415 $ 36,559
Deduct: management fee expense   (4,935 )   886     688     (3,361 )
Operating income $ 23,393   $ 5,702   $ 4,103   $ 33,198  
 
   
For the nine months ended September 30, 2018
  Impact of Impact of    
Reported Fourth Quarter First Half Impact of
GAAP 2017 DCCA 2017 DCCA 2016 DCCA Non-GAAP
 
Total revenues $ 260,478 $ $ $ $ 260,478
 
Compensation costs 72,464 (4,446 ) (2,335 ) 135 65,818
Distribution costs 29,875 29,875
Other operating expenses   16,245                 16,245  
Total expenses 118,584 (4,446 ) (2,335 ) 135 111,938
 
Operating income before management fee 141,894 4,446 2,335 (135 ) 148,540
 
Other expense, net (10,306 ) (10,306 )
 
Income before management fee and income taxes 131,588 4,446 2,335 (135 ) 138,234
Management fee expense   7,565     (1,257 )   (1,401 )   (3,090 )   1,817  
Income before income taxes 124,023 5,703 3,736 2,955 136,417
Income tax expense   30,164     1,426     934     738     33,262  
Net income attributable to GAMCO Investors, Inc. $ 93,859   $ 4,277   $ 2,802   $ 2,217   $ 103,155  
 
Net income per share attributable to GAMCO Investors, Inc.:
Basic $ 3.26   $ 0.15   $ 0.10   $ 0.08   $ 3.58  
Diluted $ 3.26   $ 0.15   $ 0.10   $ 0.08   $ 3.58  
 
 
For the nine months ended September 30, 2017
     
Reported First Half
GAAP 2017 DCCA 2016 DCCA Adjusted
 
Total revenues $ 261,858 $ $ $ 261,858
 
Compensation costs 97,634 14,390 (9,174 ) 102,850
Distribution costs 33,373 33,373
Other operating expenses   15,900             15,900  
Total expenses 146,907 14,390 (9,174 ) 152,123
 
Operating income before management fee 114,951 (14,390 ) 9,174 109,735
 
Other expense, net (7,494 ) (7,494 )
 
Income before management fee and income taxes 107,457 (14,390 ) 9,174 102,241
Management fee expense   9,455     2,666     (2,172 )   9,949  
Income before income taxes 98,002 (17,056 ) 11,346 92,292
Income tax expense   33,688     (6,594 )   4,350     31,444  
Net income attributable to GAMCO Investors, Inc. $ 64,314   $ (10,462 ) $ 6,996   $ 60,848  
 
Net income per share attributable to GAMCO Investors, Inc.:
Basic $ 2.22   $ (0.36 ) $ 0.24   $ 2.10  
Diluted $ 2.14   $ (0.34 ) $ 0.22   $ 2.02  
 

SPECIAL NOTE REGARDING FORWARD-LOOKING INFORMATION

The financial results set forth in this press release are preliminary. Our disclosure and analysis in this press release, which do not present historical information, contain forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements convey our current expectations or forecasts of future events. You can identify these statements because they do not relate strictly to historical or current facts. They use words such as anticipate, estimate, expect, project, intend, plan, believe, and other words and terms of similar meaning. They also appear in any discussion of future operating or financial performance. In particular, these include statements relating to future actions, future performance of our products, expenses, the outcome of any legal proceedings, and financial results. Although we believe that we are basing our expectations and beliefs on reasonable assumptions within the bounds of what we currently know about our business and operations, the economy, the effects of the Tax Cuts and Jobs Act, and other conditions, there can be no assurance that our actual results will not differ materially from what we expect or believe. Therefore, you should proceed with caution in relying on any of these forward-looking statements. They are neither statements of historical fact nor guarantees or assurances of future performance.

Forward-looking statements involve a number of known and unknown risks, uncertainties and other important factors, some of which are listed below, that are difficult to predict and could cause actual results and outcomes to differ materially from any future results or outcomes expressed or implied by such forward-looking statements. Some of the factors that could cause our actual results to differ from our expectations or beliefs include a decline in the securities markets that adversely affect our assets under management, negative performance of our products, the failure to perform as required under our investment management agreements, a general downturn in the economy that negatively impacts our operations, and the ongoing impacts of the Tax Cuts and Jobs Act with respect to tax rates and the non-deductibility of certain portions of NEO compensation. We also direct your attention to the more specific discussions of these and other risks, uncertainties and other important factors contained in our Form 10-K and other public filings. Other factors that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We do not undertake to update publicly any forward-looking statements if we subsequently learn that we are unlikely to achieve our expectations whether as a result of new information, future developments or otherwise, except as may be required by law.

GAMCO Investors, Inc.
Kieran Caterina or Diane M. LaPointe
SVPs
and Co-Chief Accounting Officers
(914) 921-5149 or 7763
or
For
further information please visit
www.gabelli.com

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