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Diamond Hill Investment Group, Inc. Reports Results For Second Quarter 2013

 Diamond Hill Investment Group, Inc. Reports Results For Second Quarter 2013

PR Newswire

COLUMBUS, Ohio, Aug. 2, 2013

COLUMBUS, Ohio, Aug. 2, 2013 /PRNewswire/ --Diamond Hill Investment Group,
Inc. (the "Company")(NASDAQ: DHIL) today reported unaudited results for the
quarter ended June 30, 2013 and filed its Form 10-Q. Whenever possible, we
will file and report on a Friday afternoon so that investors have a maximum
amount of time to digest the information contained therein.

                          Three Months Ended June 30,
                          2013          2012          Change
Revenue                   $19,893,096   $16,160,855   23%
 Net operating income  7,151,691     5,830,528     23%
 Operating margin      36%           36%
Investment income         728,725       (468,432)
Net income               4,711,545     3,328,097     42%
Earnings per share       $1.45         $1.07         36%



                          Six Months Ended June 30,
                          2013         2012         Change
Revenue                   $38,249,270  $32,775,075  17%
 Net operating income  13,779,305   11,851,068   16%
 Operating margin      36%          36%
Investment income         2,553,384    803,299
Net income               10,042,277   7,939,450    26%
Earnings per share       $3.12        $2.59        20%



                                 As Of
                                 June 30, 2013 December 31, 2012 June 30, 2012
Assets under management          $10,427       $9,429            $9,164
(millions)
Book value per share ^(a)        $12.06        $6.86             $10.74
Total outstanding shares         3,261,594     3,169,987         3,152,073

(a) – An $8 per share special dividend was paid in December 2012.



                                         Change in Assets Under Management
                                         For the Three Months Ended June 30,
(in millions)                            2013                2012
AUM at beginning of the period           $          $        
                                          10,574               9,360
Net cash inflows (outflows)
         proprietary funds               218                 137
         sub-advised funds               (782)               (15)
         institutional accounts          (142)               133
                                         (706)               255
Net market appreciation (depreciation)   559                 (451)
and income
Decrease during the period               (147)               (196)
AUM at end of the period                 $          $        
                                          10,427               9,164



                                   Change in Assets Under Management
                                   For the Six Months Ended June 30,
(in millions)                      2013                    2012
AUM at beginning of the period     $            $         
                                   9,429                     8,671
Net cash inflows (outflows)
       proprietary funds           360                     207
       sub-advised funds           (819)                   (75)
       institutional accounts      (175)                   20
                                   (634)                   152
Net market appreciation and income 1,632                   341
Increase during the period         998                     493
AUM at end of the period           $             $         
                                   10,427                    9,164

About Diamond Hill:
Diamond Hill is an independent investment management firm with significant
employee ownership and $10.4 billion in assets under management as of June 30,
2013. The firm provides investment management services to institutions and
individuals throughmutual funds, institutional separate accounts, and private
investment funds. Diamond Hill's entire investment team shares the same
intrinsic value investment philosophy focused on absolute returns, and the
firm's interests are firmly aligned with its clients through significant
investment in its strategies. For more information on Diamond Hill, visit
www.diamond-hill.com.

Use of Supplemental Data as Non-GAAP Performance Measure
Net Operating Income After Tax

As supplemental information, we are providing performance measures that are
based on methodologies other than generally accepted accounting principles
("non-GAAP") for "Net Operating Income After Tax" that management uses as
benchmarks in evaluating and comparing the period-to-period operating
performance of the Company and its subsidiaries.

The Company defines "net operating income after tax" as the Company's net
operating income less its income tax provision, excluding investment income
and the tax impact related to the investment income. The Company believes that
"net operating income after tax" provides a good representation of the
Company's operating performance, as it excludes the impact of investment
income on financial results. The amount of the investment portfolio and market
fluctuations on the investments can change significantly from one period to
another, which can distort the underlying earnings potential of a company. We
also believe "net operating income after tax" is an important metric in
estimating the value of an asset management business. This non-GAAP measure is
provided in addition to net income and net operating income and is not a
substitute for net income or net operating income and may not be comparable to
non-GAAP performance measures of other companies.

                             Three Months Ended June  Six Months Ended June
                             30,                      30,
(in thousands, except per   2013         2012         2013       2012
share data)
Net operating income, GAAP  $        $        $        $  11,851
basis                       7,152        5,831       13,779
Non-GAAP adjustments:
 Tax provision excluding 2,876        2,212        5,307      4,416
impact of investment income
Net operating income after  $        $        $       $   7,435
tax, non-GAAP basis         4,276        3,619       8,472
Net operating income after  $       $       $      $   
tax per share, non-GAAP      1.32         1.17        2.63      2.42
basis

The tax provision excluding impact of investment income is calculated by
applying the tax rate calculated from the income statement to net operating
income.

The Company's management does not promote that investors consider the above
non-GAAP financial measures alone, or as a substitute for, financial
information prepared in accordance with GAAP.

----------------------------------------

Throughout this press release, the Company may make 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 (the
"Exchange Act"), relating to such matters as anticipated operating results,
prospects for achieving the critical threshold of AUM, technological
developments, economic trends (including interest rates and market
volatility), expected transactions and acquisitions and similar matters. The
words "believe," "expect," "anticipate," "estimate," "should," "hope," "seek,"
"plan," "intend" and similar expressions identify forward-looking statements
that speak only as of the date thereof. While the Company believes that the
assumptions underlying its forward-looking statements are reasonable,
investors are cautioned that any of the assumptions could prove to be
inaccurate and accordingly, the actual results and experiences of the Company
could differ materially from the anticipated results or other expectations
expressed by the Company in its forward-looking statements. Factors that could
cause such actual results or experiences to differ from results discussed in
the forward-looking statements include, but are not limited to: the adverse
effect from a decline in the securities markets; a decline in the performance
of the Company's products; changes in interest rates; changes in national and
local economic and political conditions, including the effects of
implementation of the American Taxpayer Relief Act of 2012 and the Jumpstart
Our Business Startups Act of 2012 and the continuing economic uncertainty in
various parts of the world; changes in government policy and regulation,
including monetary policy; changes in the Company's ability to attract or
retain key employees; unforeseen costs and other effects related to legal
proceedings or investigations of governmental and self-regulatory
organizations; and other risks identified from time-to-time in the Company's
other public documents on file with the U. S. Securities and Exchange
Commission ("SEC").

SOURCE Diamond Hill Investment Group, Inc.

Website: http://www.diamond-hill.com
Contact: Investors: James F. Laird-Chief Financial Officer, 614-255-3353
(jlaird@diamond-hill.com)
 
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