Good day, ladies and gentlemen, and welcome to the Westwood Holdings Group First Quarter 2018 Earnings Conference Call. [Operator Instructions] As a reminder, today’s conference maybe recorded. I would now like to turn the call over to Ms. Julie Gerron, General Counsel and Chief Compliance Officer. Ma'am, you may begin.

Thank you. Good afternoon and welcome to our first quarter 2018 earnings conference call. The following discussion will include forward-looking statements which are subject to known and unknown risks, uncertainties and other factors, which may cause actual results to be materially different from those contemplated by the forward-looking statements. Additional information concerning the factors that could cause such a difference is included in our press release issued earlier today as well as in our Form 10-Q for the quarter ended March 31, 2018, that is filed with the Securities and Exchange Commission. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. You are cautioned not to place undue reliance on forward-looking statements. In addition, in accordance with SEC rules concerning non-GAAP financial measures, the reconciliation of our economic earnings and economic earnings per share to the most comparable GAAP measures is included at the end of our press release issued earlier today. On the call today, we have Brian Casey, our President and Chief Executive Officer; and Tiffany Kice, our Chief Financial Officer. I will now turn the call over to our CEO, Brian Casey.

Thanks, Julie. We appreciate all of you taking the time to listen to our first quarter earnings call. I will begin today with comments on the investment environment during the first quarter of 2018, and then dive deeper with an update on our three distinct investment themes. The beginning of the New Year [indiscernible] much as it did in 2017 with low volatility associated with the euphoria over tax cuts while internationally we continue to experience momentum driven markets. This changed quickly at the end of January as rising political uncertainty and inflation fears reversed market momentum and we experienced the first corrections since early 2016. For the remainder of the quarter market volatility remained high due to increased speculation of a trade war between the U.S. and its trading partners, especially with China and we saw U.S. and international developed markets finishing lower. Emerging markets on the other hand, saw increases in EPS growth estimates and finished higher for the quarter. Our strategies fared well in this new volatile and uncertain environment, and we believe these forces will continue to shift the investing landscape from one driven by easy money, high correlations and a rising tide to one with real winners and real losers where active managers with disciplined investment processes can outperform. U.S. market subs, smaller caps fee, large caps and growth fee value, the active versus passive debate will likely continue on but we see the current environment becoming more favorable for active management than it has been in several years. Domestically our U.S. value and multi-asset class products all had strong quarters across the board and outperformed their respective primary benchmarks. Our focus on absolute downsize, a cornerstone of our investment process, a lot of our strategies to navigate the choppy environment and add value for…

Thanks Brian, and good afternoon everyone. Today we reported total revenues of 33.6 million for the first quarter of 2018, compared to 32.6 million in the prior year's first quarter and 33.9 million in the fourth of 2017. The increase from the prior year quarter primarily related to performance-based fees of 1.3 million earned in the current quarter while decrease in the immediately preceding quarter was primarily due to net outflows during the current quarter, partially offset by the performance-based fees earned in the current quarter. As previously announced we closed the sale of our Omaha-based private wealth operations in January, we received net proceeds of 10 million and reported $500,000 gain on the sale. First quarter net income of 8 million or $0.93 per share compared to 6.1 million $0.73 per share in the prior year first quarter, primarily related to higher revenue and a $900,000 foreign currency transaction gains tax reported in the current quarter. First quarter net income of 8 million or $0.93 per share compared to 2.9 million or $0.34 per share in the fourth quarter of 2017, primarily due to 3.4 million dollars incremental income tax expense recorded during the fourth quarter of 2017 as a result of tax reform enacted in December 2017 as well as the current quarter foreign currency transaction gain previously mentioned. Economic earnings on non-GAAP Metric, was $12,6 million or $1.48 per share compared to $10,6 million or $1.28 per share in the prior year first quarter and 7.6 million or $0.89 per share in the fourth quarter 2017. Firm wide assets under management totaled 22.6 million at quarter end and consisted of institutional assets of 13.4 million or 59% of the total, private wealth assets of 5 billion or 22% total and mutual fund assets of 4.2 billion or…

[Operator Instructions] Thank you and our first question comes from the line of Mac Sykes with Gabelli. Your line is open.

I had two questions, first is one technical, when we think about the outlook pipeline searches etc. for [EM] should we think about that on the level as the amount of outflow in 1Q?

No, I don’t think you should look at it along the lines with the outflow. The outflow was very isolated with respect to one, disappointment which was the client that terminated us and the second one was simply rebalancing from our biggest client, they had over a $1 billion with us and they rebalanced back to target after a 30% return. Actually, the search activity in EM is very good right now, we have -- our ratings have improved, after we settled our litigation last fall, we’ve got lot more interest from some consultants that wouldn’t use us before, and as I said we’ve got a couple of on sites coming out that are sizeable in terms of what they could potentially bring to EM.

I was just trying to sort of -- from the size of the opportunity, it sounds like it would be less than what the outflows were in 1Q? Is that correct?

No, if that’s what it sounded like, that’s not what I meant. I think first of all a couple of things, as I said in my prepared remarks the person that hired us on the piece of business that left has gone to another pension plan, the pension plan is similar in size, and we are in active discussions currently, as for what the allocation could be it could be exactly what we lost. It could be more, it could be less, we don’t know at this point. As far other opportunities in EM we have a number of searches that are well over a 100 million in size, and usually what it is they ask you, whether your piece is beyond a 100 million and you have no idea what the size of the opportunity is until you get a little further down the process.

And then you’ve been pretty focused on making technology investments over the last few years. Can you talk about where you expect to see benefits both in the short and long term and then how do you think about these investments impacting your overall competitive position?

We have spent a lot of time and energy on technology over the last couple of years, we have moved our entire operation infrastructure to the Microsoft Azure platform, so everything we have is in the cloud, which makes us much more secure. It makes it much easier when we hire somebody or we start a new office. You can plug and play and access all of your information through that type of structure. Last year we moved everything to Bloomberg, so that our front office trading system is all on Bloomberg, we’re in the process, and partnering with InvestCloud to replace our portfolio accounting reconciliation and performance system with a completely digital offering. And what that means for us is that we will be much more efficient. We will have -- we’ll be much more accessible. The client statements and their ability to get their information will be100 times better than it is today. You will be able to access it through your phone, through your iPad, you will be able to customize your statement and see it in the way that you want to see it. The next thing we’ll be doing next year is working on our trust accounting system and what we hope to have by the end of 2019 early 2020 is that you will have a completely digital experience when you access Westwood and it will be far superior to what we have now.

[Operator Instructions]. And I'm showing no further questions at this time. I would now like to turn the call back to Mr. Brian Casey for closing remarks.

Well, thanks you Chelsea and thank you all for listening to our call today, if you have any follow up questions, feel free to call me or Tiffany directly, visit our website at westwoodgroup.com, you can also follow us on Twitter at Westwood Group or you can follow us on LinkedIn where we're starting to put a lot more thought leadership pieces that you might enjoy reading. So, thanks for your time we appreciate it. Thanks for being a shareholder of Westwood.

Ladies and gentlemen, thank you for participating in today's conference. This does conclude the program and you may all disconnect. Everyone, have a great day.