UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
FOR THE QUARTERLY PERIOD ENDED
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
FOR THE TRANSITION PERIOD FROM TO
Commission file number:
(Exact name of registrant as specified in its charter)
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(State or Other Jurisdiction of Incorporation or Organization) |
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(I.R.S. Employer Identification No.) |
(Address of Principal Executive Offices and Zip Code)
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(Registrant’s Telephone Number, Including Area Code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
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Trading Symbol(s) |
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Name of each exchange on which registered |
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Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act:
Large accelerated filer |
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Non-accelerated filer |
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Smaller reporting company |
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Emerging growth company |
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
The number of outstanding shares of the registrant’s Class A common stock, par value $0.01 per share, and Class B common stock, par value $0.01 per share, as of July 29, 2024 was
Part I |
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Item 1. |
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Condensed Consolidated Statements of Financial Condition as of June 30, 2024 and December 31, 2023 |
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1 |
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Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2024 and 2023 |
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2 |
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3 |
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Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2024 and 2023 |
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5 |
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6 |
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Item 2. |
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Management’s Discussion and Analysis of Financial Condition and Results of Operations |
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Item 3. |
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48 |
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Item 4. |
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48 |
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Part II |
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Item 1. |
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48 |
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Item 1A. |
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48 |
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Item 2. |
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49 |
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Item 3. |
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49 |
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Item 4. |
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49 |
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Item 5. |
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49 |
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Item 6. |
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49 |
Except where the context requires otherwise and as otherwise set forth herein, in this report, references to the “Company”, “we”, “us” or “our” refer to Silvercrest Asset Management Group Inc. (“Silvercrest”) and its consolidated subsidiary, Silvercrest L.P., the managing member of our operating subsidiary (“Silvercrest L.P.” or “SLP”). SLP is a limited partnership whose existing limited partners are referred to in this report as “principals”.
Forward-Looking Statements
This report contains, and from time to time our management may make, forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, each as amended. For those statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks, uncertainties and assumptions. These statements are only predictions based on our current expectations and projections about future events. Important factors that could cause actual results, level of activity, performance or achievements to differ materially from those indicated by such forward-looking statements include but are not limited to: incurrence of net losses, fluctuations in quarterly and annual results, adverse economic or market conditions, our expectations with respect to future levels of assets under management, inflows and outflows, our ability to retain clients, our ability to maintain our fee structure, our particular choices with regard to investment strategies employed, our ability to hire and retain qualified investment professionals, the cost of complying with current and future regulation coupled with the cost of defending ourselves from related investigations or litigation, failure of our operational safeguards against breaches in data security, privacy, conflicts of interest or employee misconduct, our expected tax rate, and our expectations with respect to deferred tax assets, adverse economic or market conditions, including the continued adverse effects of the coronavirus pandemic, incurrence of net losses, adverse effects of management focusing on implementation of a growth strategy, failure to develop and maintain the Silvercrest brand and other factors disclosed under “Risk Factors” in our annual report on Form 10-K for the year ended December 31, 2023 which is accessible on the SEC’s website at www.sec.gov. We undertake no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law.
Part I – Financial Information
Item 1. Financial Statements
Silvercrest Asset Management Group Inc.
Condensed Consolidated Statements of Financial Condition
(Unaudited)
(In thousands, except share and par value data)
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June 30, |
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December 31, |
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Assets |
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Cash and cash equivalents |
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$ |
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$ |
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Investments |
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Receivables, net |
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Furniture, equipment and leasehold improvements, net |
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Goodwill |
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Operating lease assets |
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Finance lease assets |
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Intangible assets, net |
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Deferred tax asset—tax receivable agreement |
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Prepaid expenses and other assets |
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Total assets |
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$ |
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$ |
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Liabilities and Equity |
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Accounts payable and accrued expenses |
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$ |
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$ |
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Accrued compensation |
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Borrowings under credit facility |
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— |
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Operating lease liabilities |
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Finance lease liabilities |
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Deferred tax and other liabilities |
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Total liabilities |
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Equity |
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Preferred Stock, par value $ |
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Class A common stock, par value $ |
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Class B common stock, par value $ |
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Additional Paid-In Capital |
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Treasury Stock, at cost, |
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( |
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( |
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Accumulated other comprehensive income (loss) |
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( |
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( |
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Retained earnings |
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Total Silvercrest Asset Management Group Inc.’s equity |
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Non-controlling interests |
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Total equity |
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Total liabilities and equity |
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$ |
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$ |
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See accompanying notes to condensed consolidated financial statements.
1
Silvercrest Asset Management Group Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
(In thousands, except share and per share data)
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Three Months Ended |
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Six Months Ended |
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2024 |
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2023 |
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2024 |
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2023 |
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Revenue |
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Management and advisory fees |
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$ |
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$ |
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$ |
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$ |
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Family office services |
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Total revenue |
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Expenses |
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Compensation and benefits |
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General and administrative |
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Total expenses |
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Income before other (expense) income, net |
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Other (expense) income, net |
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Other (expense) income, net |
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Interest income |
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Interest expense |
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( |
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( |
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( |
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( |
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Total other (expense) income, net |
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( |
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Income before provision for income taxes |
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Provision for income taxes |
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Net income |
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Less: net income attributable to non-controlling interests |
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( |
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( |
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( |
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( |
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Net income attributable to Silvercrest |
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$ |
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$ |
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$ |
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$ |
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Net income per share |
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Basic |
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$ |
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$ |
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$ |
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$ |
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Diluted |
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$ |
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$ |
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$ |
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$ |
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Weighted average shares outstanding |
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Basic |
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Diluted |
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See accompanying notes to condensed consolidated financial statements.
2
Silvercrest Asset Management Group Inc.
Condensed Consolidated Statements of Changes in Equity
(Unaudited)
(In thousands)
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Class A |
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Class A |
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Class B |
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Class B |
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Additional |
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Treasury |
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Treasury |
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Accumulated Other Comprehensive Income (Loss) |
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Retained |
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Total |
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Non- |
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Total |
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January 1, 2023 |
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$ |
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$ |
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$ |
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$ |
( |
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$ |
— |
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$ |
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$ |
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$ |
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$ |
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Distributions to partners |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
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( |
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Repayment of notes |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Equity-based compensation |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Net Income |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Deferred tax, net of amounts |
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— |
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— |
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— |
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— |
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( |
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— |
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— |
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— |
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— |
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( |
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— |
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( |
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Accrued interest on notes |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
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( |
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Share conversion |
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— |
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( |
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— |
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— |
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— |
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— |
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— |
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( |
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— |
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Purchase of shares of Class A common |
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( |
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— |
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— |
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— |
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— |
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( |
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— |
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— |
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( |
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— |
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( |
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Dividends paid on Class A |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
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( |
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— |
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( |
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Cumulative translation adjustment |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
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— |
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( |
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— |
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( |
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March 31, 2023 |
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$ |
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$ |
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$ |
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$ |
( |
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$ |
( |
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$ |
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$ |
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$ |
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$ |
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Distributions to partners |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
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( |
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Issuance of Class B shares |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Repayment of notes |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Equity-based compensation |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Net Income |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Deferred tax, net of amounts |
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— |
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— |
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— |
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— |
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( |
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— |
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— |
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— |
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— |
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( |
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( |
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Accrued interest on notes |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
) |
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( |
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Share conversion |
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— |
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( |
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— |
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— |
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— |
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— |
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— |
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( |
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— |
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Purchase of shares of Class A common |
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( |
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— |
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— |
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— |
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— |
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( |
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— |
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— |
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( |
) |
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— |
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( |
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Dividends paid on Class A |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
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( |
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— |
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( |
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Cumulative translation adjustment |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
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( |
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— |
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( |
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June 30, 2023 |
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$ |
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$ |
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$ |
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|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
3
|
|
Class A |
|
|
Class A |
|
|
Class B |
|
|
Class B |
|
|
Additional |
|
|
Treasury |
|
|
Treasury |
|
|
Accumulated Other Comprehensive Income (Loss) |
|
|
Retained |
|
|
Total |
|
|
Non- |
|
|
Total |
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
January 1, 2024 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
$ |
|
|
|
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||||||
Distributions to partners |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
Repayment of notes |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
||
Equity-based compensation |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
||
Net Income |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Deferred tax, net of amounts |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
Share conversion |
|
|
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
( |
) |
|
|
— |
|
|||
Dividends paid on Class A |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
Cumulative translation adjustment |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
March 31, 2024 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
$ |
|
|
|
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||||||||
Distributions to partners |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |