Good afternoon. My name is Julian, and I will be your conference operator for today. At this time, I would like to welcome everyone to AlTi's Second Quarter 2025 Earnings Conference Call. [Operator Instructions]. I would like to advise all parties that this conference call is being recorded, and a replay of the webcast is available on AlTi's Investor Relations website. Now at this time, I will turn things over to Lily Arteaga, Head of Investor Relations for AlTi. Please ahead.

Good afternoon to everyone on the call today. Joining me today are Michael Tiedeman, our CEO; and Mike Harrington, our CFO. We invite you to visit the Investor Relations section of our website at www.alti/global.com to view our earnings materials, including our investor presentation. I would like to remind everyone that certain statements made during the call may be deemed forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, comments made during the prepared remarks and in response to questions. Forward-looking statements can be identified by the use of words such as anticipate, believe, continue, estimate, expect, future, intend, may, planned, and will or similar terms. Because these forward-looking statements involve both known and unknown risks and uncertainties. There are important factors that could cause actual results to differ materially from those expressed or implied by these statements. For a discussion of the risks and uncertainties that could cause actual results to differ please refer to AlTi's filings with the Securities and Exchange Commission, including its most recent annual report on Form 10-K and subsequent quarterly reports on Form 10-Q. AlTi assumes no obligation or responsibility to update any forward-looking statements. During this call, some comments may include references to non-GAAP financial measures. Full reconciliations can be found in our earnings presentation and our related SEC filings. With that, I'd like to turn the call over to Mike Tiedemann.

Thank you, Lily, and good afternoon, everyone. The second quarter of 2025 was an important quarter for AlTi because of the strategic actions we executed to strengthen and simplify our business. These actions reflect the vision we've been advancing for more than 2 decades to be the leading global wealth management and OCIO platform serving the ultra-high net worth community, the fastest- growing segment of the wealth market. AlTi is truly differentiated by the scale breadth and strength of its platform. We have a global footprint that spans 3 continents, 9 countries and more than 20 cities, allowing us to serve large families seamlessly across those jurisdictions. We operate as an open architecture investment and service platform, giving clients access to best-in-class solutions, and we use our increasing scale to benefit our clients with improved pricing and access. Our offering is comprehensive from investment advisory and OCIO to trust and fiduciary services, impact investing Family Office solutions, estate planning, governance, family dynamics and education, we are strategically positioned in the fastest-growing segment of the wealth market, ultra high net worth, in which clients have fewer liquidity needs, allowing the capital to stay invested and the compound over time. We have operated our own trust company since inception, providing fully integrated fiduciary capabilities within the U.S. This structure ensures comprehensive oversight, strategic planning and seamless execution, positioning us to serve the complex needs of multigenerational families. We've built and continue to invest in operational centers of excellence, Lisbon for international operations and Delaware for U.S. Trust and Fiduciary services. Our client relationships are exceptionally strong, tenured and built on trust with a 96% retention rate, supported by senior advisers to bring more than 20 years of industry experience. Each client engagement expands our repository of best practices, enabling us to continuously…

Thank you, Michael. Good afternoon, everyone. As Mike mentioned, this quarter's results reflect timing mismatches between costs incurred and the benefits that are still ahead, and therefore, did not yet demonstrate the full earnings power of our platform. On the revenue side, they include only 2 months of contribution from Kontora and do not net capture the impact of the strong organic growth pipeline we've been building. On the expense side, results reflect onetime professional fees tied to our zero-based budgeting program, a transformational initiative expected to deliver meaningful recurring savings the benefits of which are just beginning to be realized. The second quarter also includes additional professional fees related to the exit of our international real estate business, while the significant cost savings from that exit will start to be reflected in our results in the second half. Regarding international real estate, because the transaction closed after quarter end, the numbers reported today do not reflect any wind down costs or charges. We'll report these figures once they are available. Now let me turn to the second quarter results, which I will discuss in comparison to both last year's quarter and the prior quarter, focusing on our core wealth and capital solutions business to better show the underlying trends of the ongoing business particularly now that we've exited the international real estate business. Starting with our consolidated results. Multi-generated $53 million in revenue for the second quarter of 2025 and representing 7% growth. 99% of total revenue came from stable recurring sources. These include reported management and advisory fees as well as the management fee components embedded in investment distributions from external managers. Our Core Wealth and Capital Solutions segment was the primary contributor, generating $52 million of revenue, up 8% from the prior year. This growth was largely…

Thank you, Mike. With the platform anchored in recurring revenues and expanded global footprint across 3 continents and a leaner, more agile cost structure, we're entering the second half of 2025 with confidence and complete focus. Our priorities remain clear: drive organic growth, leveraging the strength of our open architecture platform and creating value through operational discipline and targeted reinvestment. Taken together, these actions reaffirm our commitment to long-term value creation for clients and shareholders. Thank you again for your time and continued support. We are excited by the path ahead. And with that, I'll turn the call back over to the operator to open the line for questions.

[Operator Instructions]. And our first question comes from the line of Wilma Burdis with Raymond James.

Real estate has been about a $3 million per quarter quarterly drag. Just estimating that. Should we expect that to go away once the real estate business is down. And does that imply around $12 billion of higher annual EBITDA?

Willma, it's Mike Harrington. Yes, I think that has been running about $2 million negative on an adjusted basis. This quarter was a little bit higher, but yes, your premise is correct, we should be -- see a much lower expense much higher EBITDA going forward just based on the fact that once we complete the accounting and finish all that work that going forward, there won't be any expenses related to that business.

Great. And then could you talk a little bit about the net inflows. Are they margin accretive? What are the fee rates on the inflows versus the business...

It's Mike Tiedemann. I'll answer that one. Internationally, the ROA on incoming business has been inflows has been higher than the exiting flows or any sort of outflows that we've had. So the net actually has been quite positive. In the U.S., it depends. And what it really depends by is the size of families. And as you'd imagine, as you bring in a much larger relationship the management fee on balance decline doesn't have to do with the net margins as a result of that increased growth, but it does have to do with sort of the billable ROA that you record. So it is more of a mixed bag depending on that's really quarter-by-quarter the aggregate size of family as they onboard. And Q2, so just one thing on specifically within the states second quarter tends to be for tax payments, a natural outflow quarter just specifically related to that not lost business, but just outflows for client bases that are paying those taxes for your modeling purposes.

Okay. And then bringing Kontora on 2Q reflects 2 out of 3 months of results of the acquisition, but could you help us think about on a more quarterly [indiscernible].

So the Kontora business is to give you a sense, and we're very optimistic about what can be driven not just with the existing business, but what is to come in that marketplace. But the Kontora business is of the -- there's a very large AUA and they have -- which is essentially a large family office service component a lot of complex tax services and family office related services that are more fixed fee in nature and arguably lower ROA. And that -- they are in process of doing 2 things: One, the organic growth working with us and collaborating with us which is already yielding results; and two, really converting and refocusing their existing client base into more discretionary mandates, which is consistent with the rest of all tea. So we expect that to be, in general, a continued profitable business. And our deal structure was set up to really reward the team for their success over time as they drive margins. So the back end of the consideration will be driven really by that. So as we drive margins, they will obviously earn more comparable for that. So there's a lot of alignment there.

And could you talk about the opportunity to recruit teams from banks? Just what does that look like going forward?

Depends regionally. I think that it really depends -- we want to make sure anyone that joins the firm is a great fit. So there's a cultural component. Their client base has to be a good fit as well. And many of them have to be looking to join the firm has a real holistic service model. So in many cases, we are a desirable platform because we bring all of that to bear more global. We have all the services that I mentioned in my earlier part of the call. So we do believe that will be an increasing part of our recruiting, and we are actively engaged with some opportunities as we sit here today.

And with that, there are no further questions at this time. I'd like to turn the call back to Michael Tiedemann, for closing remarks.

Great. Well, thank you again for listening in. We look forward to any follow-up conversations and please feel free to contact Lily Arteaga with any questions that you might have that were not asked today.

Thank you. And with that, this does conclude today's teleconference. We thank you for your participation. You may disconnect your lines at this time. Have a wonderful day.