We got a little bit further than that and quicker than that, which is great, and we’ll continue to look at that in 2024 in order to — in order to continue to invest. So I’m not going to give expense guidance today for 2024. We’ll do that in — on the full-year call. But again, you should expect us to remain balanced in investing in the business and trying to find efficiencies to offset those investments. Ali, anything you’d add to that?
Ali Dibadj: Yeah. Maybe just a little bit. Look, we’re going to continue to be client-led and ROI-driven in our investments. We have, in a relatively short period of time, really reoriented our — think about it as a portfolio of expenses, we’ve reoriented our portfolio expenses to be much more focused on meeting client needs and focusing on ROI, again, aligned with our strategy. So we feel like we’re on our front foot right now. You’re seeing that in our market share gains relative to our peers pretty much across the board. We believe we’re certainly building a stronger firm in a very challenging environment. And we will continue to look for opportunities to take our expenses and reorient them in the most client-led and ROI-driven manner.
Dan Fannon: Great. Thank you.
Operator: Thank you. Our next question comes from Nigel Pittaway from Citigroup. Nigel, please go ahead.
Nigel Pittaway: Good morning, Ali and Roger. Just a question on the cost guidance, if I can. You brought that down to mid-single digit on the non-comp costs, but it looks like even a 10% increase in the fourth quarter and what you’ve done in the third quarter will only bring you to that 3% increase. So are you flagging sort of a significant increase in the fourth quarter and if so, where is that going to come from?
Roger Thompson: Yeah, Nigel. Yeah, that we are expecting an increase in Q4, which is more seasonal than anything else around things like — things like brand and some professional work that we’re doing that will be a pickup in Q4. Again, I think when you’re looking year-on-year, you should be looking at our spend for ’23 compared to ’24 as opposed to annualizing Q4, but yeah, we do expect a pickup in Q4. Again, we’ll continue to try and balance that, we’ll continue to look for efficiencies, but we brought in that guidance from, I think it was low single digits at the beginning of the year now to — sorry, low double-digits at the beginning of the year to now mid-single digits. We’ll continue to try and balance that but we would expect — we do expect to spend a little bit more in Q4, so that’s more timing than anything else.
Nigel Pittaway: Okay. Thanks. Yeah, the 3% was year-on-year, but nonetheless, thank you for that. And then also on the comp ratio, it’s almost the opposite, that you’re going to have to have, pretty low comp ratio in the fourth quarter to meet that full-year guidance. Is that — is that the right way to think about that one as well?
Roger Thompson: Again, there’s a little bit of — there’s a little bit of timing in there, that the early part of the year is always a little bit higher, but yes, there is — we’ve talked about mid, mid-40s, we’re at, what, 43 and a bit, 45 and a bit this quarter. We don’t expect to be too far off that, maybe a little bit higher in Q4 than Q3.
Nigel Pittaway: Okay. Thank you for that. And then finally, maybe just on investment performance. I mean, I know it has sort of improved on a number of durations, et cetera, but obviously, the three-year performance, which is often viewed as key, has sort of deteriorated quite a bit. Do you see that as a hurdle at all or are people just sort of willing to look at, one year and five-year and not sort of focused too much on that three-year performance?
Ali Dibadj: So we obviously strive to deliver on all performance cycles. We all know what happened roughly three years ago from a COVID perspective, which drove quite a significant dislocation in the marketplace. Our investment teams remain disciplined in their processes. Our clients know that, they look at the process, and so, generally speaking, I’d argue people look at all time frames and make a judgment that way.
Nigel Pittaway: Okay. Thank you.
Operator: Thank you. Our next question comes from Ken Worthington from JP Morgan. Ken, please go ahead.
Ken Worthington: Hi. Good morning. Thanks for taking the question. When you talk about the institutional pipeline needing to mature, can you update us on what a fully mature pipeline looks like to you versus what the pipeline looks like today? And what is the timeline you think you need to reach that pipeline maturity?
Ali Dibadj: It’s a great question. So look, remember our institutional business so far has delivered $8.5 billion of positive flows for the year. Imagine that, Ken, being in a pipeline, pick a number six to 12 months ago, and that has to be replenished. So if you go forward, that is something that we would like to do obviously, and the cheeky answer to your question is we’d like the pipeline to be bigger than it is today. Now from a timeframe perspective, these are longer cycle sales as you — as you know. You can think about these sales as far out as two years from now, depending on what needs are there from a client perspective. So these things take time. The good news is that they are ramping up significantly in terms of the activity levels.
Clearly, our consultant wins have come up quite significantly. Our discussions with institutional investors has gone up quite significantly. And as you well know, one of our strategic initiatives is to invest in our institutional distribution pipeline including adding a better team, and we’ve done that for now, and who are quite significantly in the marketplace talking to institutional clients. So it will take time. I don’t have a precise answer for you, but we’re certainly on the right track and getting stronger in a tough environment.
Ken Worthington: Okay. Thank you. And then on the ASX delisting, how and when will the delisting from the ASX be executed? How much of Janus’s market cap is listed today on the ASX and are there any steps that you’re taking to kind of protect shareholders during this transition?
Ali Dibadj: So the ASX is about 5% of our shareholders right now. You might remember it was close to north of 40%. I think 44% at its peak of shareholders at a certain point, and so clearly that’s come down quite significantly. Remember, our decision to do the delist is to be able to focus on 95% of our shares, to focus on that sole exchange, New York Stock Exchange, to reduce significant costs as we fuel growth and to simplify our structure for regulatory reasons, M&A reasons, and other reasons. And so, that’s clearly a focal point for us. If you think about that, that’s, call it 10 or 11 days of trading volume for us. There’ll be roughly, and Roger can jump in with more details, there’ll be roughly 120 calendar days to work through that 5% and people can convert directly from an ASX listing to a New York Stock Exchange listing, which will probably reduce that 5% as well.
