Sculptor Capital Management : 2023 Q3 Earnings Release

November 8, 2023

Sculptor Reports

Third Quarter 2023

Financial Results

Sculptor Reports Third Quarter 2023 Financial Results

New York - November 8, 2023 - Sculptor Capital Management, Inc. (NYSE: SCU) today reported its unaudited results for the third quarter of 2023.

About Sculptor

Sculptor is a leading global alternative asset manager and a specialist in opportunistic investing. For over 25 years, we have pursued consistent outperformance by building an operating model and culture which balance the ability to act swiftly on market opportunity with rigorous diligence that minimizes risk. Our model is driven by a global team that is predominantly home-grown, long tenured and incentivized to put client outcomes first. With offices in New York, London, Hong Kong, and Shanghai, we invest across credit, real estate and multi-strategy platforms in all major geographies. As of November 1, 2023, Sculptor had approximately $32.8 billion in assets under management. For more information, please visit our website (www.sculptor.com).

Shareholder Services Contact

Ellen Conti

Head of Corporate Strategy [phone] [e-mail]

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Forward Looking Statements

This press release and earnings presentation contain 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, that reflect the Company's current views with respect to, among other things, future events, its operations and its financial performance. The Company generally identifies forward-looking statements by terminology such as "outlook," "believe," "expect," "potential," "continue," "may," "will," "should," "could," "seek," "approximately," "predict," "intend," "plan," "estimate," "anticipate," "opportunity," "comfortable," "assume," "remain," "maintain," "sustain," "achieve," "see," "think," "position" or the negative version of those words or other comparable words.

Any forward-looking statements contained in this press release are based upon historical information and on the Company's current plans, estimates and expectations. The inclusion of this or other forward-looking information should not be regarded as a representation by the Company or any other person that the future plans, estimates or expectations contemplated by the Company will be achieved.

The Company cautions that forward-looking statements are subject to numerous assumptions, estimates, risks and uncertainties including but not limited to the following: global economic, business, market and geopolitical conditions; poor investment performance of, or lack of capital flows into, the funds the Company manages; the Company's investors' right to redeem their investments from the Company's funds on a regular basis; the highly variable nature of the Company's revenues, results of operations and cash flows; difficult market conditions that could adversely affect the Company's funds; counterparty default risks; the United Kingdom's withdrawal from the European Union; the outcome of third-party litigation involving the Company; or from matters involving the Company's founding CEO; conditions impacting the alternative asset management industry; the Company's ability to retain existing investor capital; the Company's ability to successfully compete for fund investors, assets, professional talent and investment opportunities; the Company's ability to retain its active executive managing directors, managing directors and other investment professionals; the Company's successful formulation and execution of its business and growth strategies; the Company's ability to appropriately manage conflicts of interest and tax and other regulatory factors relevant to its business; U.S. and foreign regulatory developments relating to, among other things, financial institutions and markets, government oversight, fiscal and tax policy; and assumptions relating to the Company's operations, investment performance, financial results, financial condition, business prospects, growth strategy and liquidity.

If one or more of these or other risks or uncertainties materialize, or if the Company's assumptions or estimates prove to be incorrect, its actual results may vary materially from those indicated in these statements. These factors are not and should not be construed as exhaustive and should be read in conjunction with the other cautionary statements and risks that are included in the Company's filings with the SEC, including but not limited to the Company's annual report on Form 10-K for the year ended December 31, 2022, dated March 3, 2023, as well as may be updated from time to time in the Company's other SEC filings. There may be additional risks, uncertainties and factors that the Company does not currently view as material or that are not known. The forward-looking statements contained in this press release are made only as of the date of this press release. The Company does not undertake to update any forward-looking statement because of new information, future developments or otherwise except as may be required by law. This press release does not constitute an offer of any Sculptor Capital fund.

The Company files annual, quarterly and current reports, proxy statements and other information required by the Exchange Act of 1934, as amended, with the SEC. The Company makes available free of charge on its website (www.sculptor.com) its annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, proxy statements and any amendment to those filings as soon as reasonably practicable after such material is electronically filed with or furnished to the SEC. The Company also uses its website to distribute company information, including AUM by investments strategy, and such information may be deemed material. Accordingly, investors should monitor the Company's website, in addition to its press releases, SEC filings and public conference calls and webcast.

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Third Quarter 2023 Financial Results

Third Quarter 2023 Financial Highlights

• GAAP Net Loss Attributable to Class A Shareholders of $31.1 million for 3Q, or $(1.23) per basic and $(1.23) per diluted Class A Share
• Distributable Earnings were a loss of $7.5 million for 3Q, or $(0.13) per Fully Diluted Share
• Adjusted Distributable Earnings were $8.9 million for 3Q, or $0.15 per Fully Diluted Share

(dollars in millions, except per share amounts)		3Q '23		2Q '23		3Q '22		YTD '23		YTD '22
GAAP Results
Net Loss Attributable to Sculptor Capital Management	$	(31.1)	$	(4.4)	$	(22.7)	$	(25.8)	$	(17.6)
Net (Loss) Income Attributable to Class A Shareholders		(31.1)		3.6		(22.5)		(19.0)		(13.7)
(Loss) Earnings per Class A Share - basic		(1.23)		0.15		(0.91)		(0.75)		(0.53)
Loss per Class A Share - diluted		(1.23)		(0.12)		(0.91)		(1.00)		(1.79)
Non-GAAP Financial Measures
Distributable Earnings	$	(7.5)	$	(0.3)	$	0.6	$	6.4	$	61.9
Distributable Earnings Per Fully Diluted Share		(0.13)		0.00		0.01		0.11		1.05
Adjusted Distributable Earnings		8.9		5.3		3.0		35.3		65.2
Adjusted Distributable Earnings Per Fully Diluted Share		0.15		0.09		0.05		0.62		1.10
Adjusted Net Assets		283.1		267.8		305.9		283.1		305.9
Accrued but Unrecognized Incentive Income ("ABURI")		206.0		194.9		194.3		206.0		194.3
Capital Metrics
Assets Under Management	$	33,752	$	34,759	$	36,112	$	33,752	$	36,112
Please see page 3 of this press release for disclosures on forward-looking statements contained within.
This page contains non-GAAP measures, including Distributable Earnings, Adjusted Distributable Earnings, Adjusted Net Assets, and Accrued but Unrecognized Incentive Income. Please
reference pages 23-30 for more information and reconciliations of the Company's non-GAAP measures to the most directly comparable respective financial measures presented in
accordance with GAAP.										5 |

Third Quarter 2023 Highlights

Recent Developments

On October 27, 2023, Rithm Capital Corp. (NYSE: RITM; "Rithm") and Sculptor announced that they have amended the terms of their previously announced definitive merger agreement (the "Amended Agreement") under which Rithm will acquire Sculptor in a transaction valued at approximately $720 million, which includes $12.70 per Class A share of Sculptor, an increase of 13.9% over Rithm's previously agreed price of $11.15 per Class A share announced on July 24, 2023. The transaction, subject to customary closing conditions, is expected to close in 4Q 2023

• Special meeting of stockholders scheduled to be held on November 16, 2023
• All regulatory approvals necessary to consummate the transaction have been received
• Fund investor consent threshold of 85% has currently been met3

• • Rithm has agreed to waive the client consent condition with respect to all funds, provided that the closing of the transaction occurs on or prior to November 17, 2023
• Refer to the 8-K and definitive proxy statement supplement dated October 30, 2023 and the 3Q 2023 10-Q for additional detail, including with respect to merger litigation proceedings

Fund Performance

• Assets Under Management

• Gross fund performance for the quarter and year-to-date ("YTD")1:
• • Sculptor Credit Opportunities Master Fund was up 2.1% in 3Q and up 10.0% YTD
  • Customized Credit Focused Platform was up 2.1% in 3Q and up 10.3% YTD
  • Master Fund was up 3.3% in 3Q and up 12.9% YTD
• AUM was $33.8 billion, down $1.0 billion quarter-over-quarter
• Fee-payingAUM ("FP AUM") was $27.4 billion or 81% of total AUM
• Longer-termAUM was $25.1 billion or 74% of total AUM
• Gross inflows were $46.9 million into multi-strategy funds and $377.7 million across our platform2, bringing YTD gross inflows to $101.0 million into multi-strategy funds and $717.4 million across our platform2

Financial Results

• GAAP Net Loss Attributable to Class A Shareholders was $31.1 million ($(1.23) per basic and $(1.23) per diluted Class A Share)
• Distributable Earnings were a loss of $7.5 million ($(0.13) per Fully Diluted Share)
• Adjusted Distributable Earnings were $8.9 million for 3Q, or $0.15 per Fully Diluted Share
• Adjusted Net Assets were $283.1 million
• Accrued But Unrecognized Incentive Income ("ABURI") was $206.0 million
• We have generated a total of $545.6 million of Distribution Holiday Economic Income, compared to the target of $600.0 million

Please see page 3 of this press release for disclosures on forward-looking statements contained within. This page contains non-GAAP measures. Please reference pages 23-30 for more information and reconciliations of the Company's non-GAAP measures to the most directly comparable respective financial measures presented in accordance with GAAP.

1	Please see pages 7 and 31-33 of this press release for comprehensive fund performance disclosures, including net returns and comparison of returns to other relevant indices or benchmarks.	6 |
2
3	Gross inflows across the platform excludes transfers from other Sculptor funds. Please see pages 8 and 14 for more detailed disclosures and net flows.
Subject to change at the time of closing, if closing occurs subsequent to November 17, 2023

Fund Performance

• Overall, funds extended strong absolute and relative outperformance amidst continued volatility and an uncertain economic environment
• Opportunistic credit funds extended strong absolute and relative performance versus relevant benchmarks, fully recovering 2022 losses and eliminating our high water mark and building upon their long-term track records
• Real Estate funds continued to perform and showed the benefits of less correlation to traditional asset classes
• Multi-Strategyextended strong YTD absolute and relative performance versus relevant benchmarks capturing virtually all of the upside in
  global risk assets and substantially recovering 2022 losses and reducing our high water mark. The strategy maintains an attractive long term track record with a 15.4% gross return since inception with less than half the volatility of equity markets, achieving a Sharpe Ratio(d) of 1.3

					Since Sculptor
(as of September 30, 2023)	3Q 2023	YTD 2023	FY 2022	5 Year	Fund Inception
Sculptor Credit Opportunities Master Fund Gross	2.1 %	10.0 %	(3.2)%	5.6 %	12.6 %
(inception November 1, 2011)(a)(b)
Sculptor Credit Opportunities Master Fund Net	1.5 %	8.1 %	(4.1)%	3.5 %	8.9 %
BAML Global High Yield(c)	0.1 %	5.4 %	(13.2)%	1.8 %	4.5 %
HFRX Fixed Income Credit Index(c)	(0.1)%	2.9 %	(11.6)%	1.1 %	1.8 %
Customized Credit Focused Platform Gross	2.1 %	10.3 %	(1.9)%	8.8 %	13.2 %
(inception April 6, 2010)(a)(t)
Customized Credit Focused Platform Net	1.6 %	7.9 %	(2.0)%	6.9 %	11.4 %
BAML Global High Yield(c)	0.1 %	5.4 %	(13.2)%	1.8 %	4.9 %
HFRX Fixed Income Credit Index(c)	(0.1)%	2.9 %	(11.6)%	1.1 %	1.8 %
Multi-Strategy Composite Gross	3.3 %	12.9 %	(11.6)%	9.3 %	15.4 %
(inception April 1, 1994)(a)(d)
Multi-Strategy Composite Net	2.9 %	11.7 %	(12.9)%	6.1 %	10.7 %
HFRI Fund Weighted Composite Index(e)	0.5 %	3.9 %	(4.1)%	5.0 %	7.4 %
MSCI World(e)	(2.5)%	12.5 %	(15.6)%	8.5 %	7.9 %
Balanced US 60/40 Index(e)	(3.7)%	4.9 %	(19.1)%	2.9 %	4.8 %
		Real Estate
Life-to-Date Performance
(as of September 30, 2023)	Fund I	Fund II	Fund III	Credit Fund I
Gross(f)	25.5 %	32.8 %	30.2 %	18.0 %
Net(g)	16.1 %	21.6 %	20.0 %	12.7 %

Please see pages 31-33 of this press release for important information related to the footnotes referenced in this section.

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Assets Under Management

• AUM decreased $1.0 billion during 3Q primarily from net outflows in multi-strategy and opportunistic credit and distributions across credit, partially offset by positive fund performance in multi-strategy and opportunistic credit
• • Opportunistic Credit decreased from distributions in the Customized Credit Focused Platform and net outflows, partially offset by positive fund performance
  • ICS decreased as the closing of an additional US CLO was offset by distributions and other changes(j) to AUM
  • Real Estate relatively flat as modest inflows were offset by return of capital as investments were harvested
  • Multi-strategydecreased from net outflows, partially offset by positive fund performance

$ in billions

	AUM
36.1	34.8
	33.8
9.4	8.5	8.1
4.5	4.2	4.2
16.2	16.2	15.9
6.0	5.8	5.5
3Q 2022	2Q 2023	3Q 2023

FP AUM

% Total
AUM
24%	29.4	28.5	27.4
13%	9.2	8.4	8.0
	3.8	3.8	3.8
47%
	11.0	11.1	10.7
16%	5.3	5.2	4.9
	3Q 2022	2Q 2023	3Q 2023
% AUM	81%	82%	81%

Longer-Term AUM

25.9	25.5	25.1
0.5	0.4	0.4
4.5	4.2	4.2
16.2	16.2	15.9
4.7	4.7	4.6
3Q 2022	2Q 2023	3Q 2023
72%	73%	74%

Opportunistic Credit

Institutional Credit Strategies (ICS)

Real Estate

Multi-Strategy

Refer to the Assets Under Management Roll Forwards on page 14 for additional information.
This page contains non-GAAP measures. Please reference pages 23-30 for more information and reconciliations of the Company's non-GAAP measures to the most directly comparable
respective financial measures presented in accordance with GAAP.
Please see pages 31 through 33 of this press release for important information related to the footnotes referenced in this section.	8 |

Financial Results - Third Quarter 2023 GAAP

• Net Loss Attributable to Class A Shareholders was $31.1 million for 3Q 2023, or $(1.23) per basic and $(1.23) per diluted Class A Share
• Net Loss Attributable to Class A Shareholders was $19.0 million YTD 2023, or $(0.75) per basic and $(1.00) per diluted Class A Share

(dollars in millions, except per share amounts)		3Q '23		2Q '23		3Q '22	YTD '23	YTD '22
Revenues	$	85.7	$	75.3	$	78.9	$	274.2	$	295.4
Management fees		60.2		62.4		66.2		186.3		211.4
Incentive income		17.8		4.3		7.6		62.4		73.8
Other revenues		7.7		6.7		3.6		20.9		8.5
Income of consolidated entities		-		1.9		1.5		4.6		1.7
Expenses	$	111.1	$	94.9	$	100.3	$	314.6	$	320.2
Compensation and benefits		62.1		57.5		67.1		188.2		224.7
Interest expense		6.7		6.3		3.9		18.5		10.6
General, administrative and other		42.1		29.9		28.3		105.8		82.0
Expenses of consolidated entities		0.2		1.3		1.0		2.1		2.9
Other (Loss) Income	$	(13.3)	$	6.1	$	(9.0)	$	5.9	$	(4.1)
Income taxes		(0.2)		(1.2)		0.2		11.3		(0.7)
Consolidated Net Loss	$	(38.5)	$	(12.3)	$	(30.6)	$	(45.8)	$	(28.2)
Less: Net loss attributable to noncontrolling		7.4		9.8		9.4		23.4		15.9
Interests
Less: Net (income) loss attributable to redeemable		-		(1.9)		(1.5)		(3.4)		(5.3)
noncontrolling interests
Net Loss Attributable to Sculptor Capital	$	(31.1)	$	(4.4)	$	(22.7)	$	(25.8)	$	(17.6)
Management, Inc.
Change in redemption value of redeemable		-		8.0		0.2		6.8		3.9
noncontrolling interests
Net (Loss) Income Attributable to Class A	$	(31.1)	$	3.6	$	(22.5)	$	(19.0)	$	(13.7)
Shareholders
(Loss) Earnings per Class A Share - basic	$	(1.23)	$	0.15	$	(0.91)	$	(0.75)	$	(0.53)
Loss per Class A Share - diluted	$	(1.23)	$	(0.12)	$	(0.91)	$	(1.00)	$	(1.79)

• Revenues were up 9% from 3Q '22, primarily driven by:
• • Higher incentive income from crystallizations in real estate and opportunistic credit funds
  • Higher other revenues due to higher interest rates
  • Lower management fees from lower multi-strategy AUM driven by net outflows
• Expenses were up 11% from 3Q '22, primarily driven by:
• • Higher general, administrative and other expenses from elevated professional services expenses related to the activities of the Special Committee of our Board of Directors and related ongoing litigation
  • Higher interest expense due to higher interest rates
  • Lower compensation and benefits expense primarily due to lower equity- based compensation
• Other loss increased from 3Q '22, primarily from changes in the fair value of warrant liabilities and net losses of consolidated funds, partially offset by gains on investments
• Income tax expense decreased from 3Q '22 due to lower profitability for the period

For details on the additional underlying drivers of our revenue and expenses, see the Economic Income analysis on page 10.

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Financial Results - Third Quarter 2023 Economic Income

• Economic Income was a loss of $3.0 million for 3Q and a gain of $18.7 million YTD 2023
• Distributable Earnings were a loss of $7.5 million for 3Q, or $(0.13) per Fully Diluted Share and a gain of $6.4 million YTD 2023 or $0.11 per Fully Diluted Share
• Adjusted Distributable Earnings were $8.9 million for 3Q, or $0.15 per Fully Diluted Share and $35.3 million YTD 2023 or $0.62 per Fully Diluted Share

(dollars in millions)		3Q '23		2Q '23		3Q '22		YTD '23	YTD '22
Revenues	$	80.5	$	68.3	$	71.4	$	254.4	$	274.7
Management fees		56.1		58.4		61.2		174.2		195.3
Incentive income		17.8		4.3		7.6		62.4		73.7
Other revenues		6.6		5.6		2.6		17.8		5.7
Expenses	$	83.5	$	65.1	$	65.8	$	235.5	$	207.2
Total compensation and benefits		41.0		35.3		40.9		130.1		138.1
Salaries and benefits		18.2		18.9		18.0		56.0		53.9
Bonus		22.8		16.4		22.9		74.1		84.2
General, administrative and other		36.0		23.9		21.2		87.8		59.2
Interest expense		6.5		5.9		3.7		17.6		9.9
(dollars in millions)		3Q '23		2Q '23		3Q '22		YTD '23		YTD '22
Distributable Earnings	$	(7.5)	$	(0.3)	$	0.6	$	6.4	$	61.9
Excluded expenses11		16.4		5.6		2.4		28.9		3.3
Adjusted Distributable Earnings	$	8.9	$	5.3	$	3.0	$	35.3	$	65.2
Distributable Earnings per Fully Diluted Share	$	(0.13)	$	-	$	0.01	$	0.11	$	1.05
Adjusted Distributable Earnings per Fully Diluted Share	$	0.15	$	0.09	$	0.05	$	0.62	$	1.10

• Management fees were down 8% from 3Q '22 primarily from lower multi- strategy AUM driven by net outflows
• Incentive income was $17.8 million, driven by crystallizations in real estate and opportunistic credit funds
• Expenses were up 27% from 3Q '22; up 6% adjusting for excluded expenses11
• • Total fixed compensation, comprised of salaries and benefits and minimum discretionary bonus, was down due to lower headcount
  • Bonus for the quarter was driven by minimum discretionary bonus of $16.1 million and carried interest profit sharing linked to incentive income on our real estate funds
  • General, administrative, and other expenses increased due to $16.4 million of elevated professional services expenses related to the activities of the Special Committee of our Board of Directors and related ongoing litigation
• Other revenues and interest expense increased due to higher interest rates

This page contains non-GAAP measures. Please reference pages 23-30 for more information and reconciliations of the Company's non-GAAP measures to the most directly comparable	10 |
respective financial measures presented in accordance with GAAP.