#1W Westwood HOLDINGS GROUP INCO Investor Relations Presentation As of September 30, 2016#2Westwood | Firm Overview | Our mission is to exceed client expectations through exceptional performance and ethical conduct. Multi-Investment Team Structure U.S. Value Global and Emerging Markets Equity Global Convertible Securities Deep, Experienced Investment Staff Over 50 investment professionals W Institutional Mutual Funds Private Wealth Employee Ownership Culture Employees and directors own equity, totaling 26%; no employee owns more than 5% Thoughtful Growth Strategy Estimated capacity of $80B+ across all strategies Manage capacity to deliver alpha Overview Founded 1983 AUM $21.3B Employees 177 Publicly Listed | NYSE: WHG 1 Westwood Management Corp. was founded and registered with the SEC in April 1983. Its parent company, Westwood Holdings Group, Inc., was launched as a public company in 2002, trading on the New York Stock Exchange under the symbol WHG. Except as otherwise noted, all references to or information about the "firm" or "Westwood" throughout this presentation describe Westwood Holdings Group, Inc. and its wholly owned subsidiaries, which include Westwood Management Corp., Westwood Trust, Westwood Advisors, LLC, and Westwood International Advisors Inc. 2 Selection criteria based 40% on corporate application and 60% on anonymous employee questionnaires within the "100-499 employees" category. Ranked 3 out of 5 and awarded on December 14, 2015. 3 As of March 7, 2016 2 Investing Where It Counts BEST PLACES TO WORK IN MONEY MANAGEMENT ✰✰ 2015✰✰ Pensions&Investments 2 As of September 30, 2016 W#3Business Growth | Revenue and Assets Under Management Annual Revenue ($ millions) 140 120 100 60 40 20 Westwood Growth in Revenues and Assets Under Management 0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 3 Investing Where It Counts Quarterly AUM Annual Revenue 5 25 20 15 10 10 Quarterly AUM ($ billions) As of December 31, 2015 W#44 Business Growth | Shareholder Value Creation Current Yield 4.9%* Over $125 million paid out in dividends since 2002 900 800 700 600 500 400 300 200 100 0 Total Shareholder Return Comparison WHG +648.9% Since Inception Q3 2016 -100 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Investing Where It Counts Westwood Holdings Group, Inc. Total Return Russell 2000 (TR) - Total Return S&P 500 (TR) Total Return Source: Bloomberg, daily data from 7.1.02 to 9.30.16 *Current yield as of 10.25.16 Past performance is not indicative of future results. W#5Business Model Overview | Strategy Core Focus: 66 Experienced investment teams managing relevant strategies across a global client base. Building and maintaining multiple strong investment engines to deliver top-tier performance across asset classes. Talent management, performance management and alignment of compensation structure with strategic initiatives. Strengthening product prioritization and innovation to capitalize on structural industry trends. 5 Investing Where It Counts Sales and marketing excellence to accelerate global multi-channel distribution initiatives. Preserving our culture and continuing to drive value for our shareholders. W#6Core Growth Drivers | The Way Forward Growth imperatives are concentrated in 5 key areas: 66 Product and distribution alignment with structural industry growth themes. 1 Product development efforts focused on high conviction investing, low volatility, multi- asset, liquid alternatives and liquid real assets. 3 Scale our private wealth business organically via customized solutions and OCIO- like offering, as well as inorganically via select acquisitions. 5 Non-U.S. multi-channel distribution initiatives including UCITS and key markets across Europe, Asia and Australia. 2 Continue growing long-tenured relationships with industry- leading investment management consultants, including those 60 that we currently have common clients with. 4 Monetize our development of 15 mutual funds across the wealth advisory, defined contribution, retail and RIA channels. Build on 10 years of consecutive net inflows.1 1 As of December 31, 2015 6 Investing Where It Counts#7Westwood | High-Conviction and Outcome-Oriented Solutions Separately Managed Accounts | Mutual Funds | Collective Funds | UCITS U.S. VALUE EQUITY LargeCap Value Concentrated LargeCap Value AllCap Value Concentrated AllCap Value SMidCap SMidCap Plus MULTI-ASSET Income Opportunity Worldwide Income Opportunity LIQUID REAL ASSETS MLP Infrastructure Renewal MLP Opportunities MLP and Strategic Energy SmallCap Value GLOBAL & EMERGING MARKETS EQUITY LOW VOLATILITY EQUITY LIQUID ALTERNATIVES Global Dividend Strategic Global Convertibles Market Neutral Income Global Equity Emerging Markets Emerging Markets Plus Emerging Markets SMidCap 7 Investing Where It Counts U.S. Low Volatility Equity As of September 30, 2016. W#8Core Growth Theme | Product Development 2013-2016 High Conviction Equity Multi- Asset Low Volatility Equity Emerging Markets SMidCap 9/1/2013 Concentrated LargeCap Value 1/1/2014 Concentrated AllCap Value 1/1/2014 8 Investing Where It Counts Worldwide Income Opportunity 4/1/2015 + Liquid Alternatives Liquid Real Assets Strategic Global Convertibles 10/1/2014 Market Neutral Income 10/1/2014 MLP Opportunities 1/1/2014 MLP and Strategic Energy U.S. Low Volatility Equity 1/1/2016 1/1/2015 Dates represent strategy inception date. W#9Core Growth Theme | Product Offerings Across the Risk Spectrum Low Volatility Market Neutral Income Worldwide Income Opportunity U.S. Low Concentrated Concentrated Volatility Equity LargeCap Value AllCap Value SMidCap SmallCap Plus Value Emerging Markets & Emerging Markets Plus High Volatility Income Opportunity Strategic Global Convertibles LargeCap Value AllCap Value Global Equity & SMidCap MLP Strategies Emerging Markets Global Dividend SMidCap 9 Investing Where It Counts W#10Westwood | Product and Channel Diversification 10 STRATEGY BREAKDOWN 3% MLPs 19% Global/Emerging Equity 19% Multi-Asset ASSETS BY ACCOUNT TYPE INSTITUTIONAL CLIENT TYPE 4% 36% Foundations/Endowments U.S. Value Equity 5% 23% Other Institutional and Private Wealth strategies 5% Taft-Hartley/Superannuation UCITS 8% 29% Public Funds Sovereign Wealth 21% Corporate 28% Sub-Advisory 3% UCITS 54% Institutional Separate Accounts 18% & Other Managed Accounts Westwood Mutual Funds 19% Non-U.S. 25% Private Wealth ASSETS BY CLIENT DOMICILE 81% U.S. Percentages in the Strategy Breakdown, Assets by Account Type, and Assets by Client Domicile charts are based upon firm-wide assets under management as of September 30, 2016. Percentages in the Institutional Client Type chart are based upon the combined assets under management of Westwood Management Corp. and Westwood International Advisors Inc. only, less assets managed for private individuals, investment LLCs, managed accounts, and collective investment trusts. Investing Where It Counts As of September 30, 2016 W#1111 AUM ($ billions) AUM ($ billions) Distribution | Multi-Channel Focus Institutional AUM $16.0 $14.0 $12.0 $10.0 $8.0 $6.0 $4.0 $2.0 $0.0 Sep-11 Private Wealth AUM $6.0 % of AUM Non-U.S. Client Assets 20.00% 15.00% 10.00% 5.00% 0.00% Sep-12 Sep-13 Sep-14 Sep-15 Sep-16 Sep-11 Sep-12 Sep-13 Sep-14 Sep-15 Sep-16 Mutual Funds AUM $4.5 $5.0 $4.0 $3.5 $4.0 $3.0 $2.0 AUM ($ billions) $3.0 64210 $2.5 8 $2.0 6 $1.5 4 $1.0 $1.0 $0.5 2 $0.0 0 $0.0 Sep-11 Sep-12 Sep-13 Sep-14 Sep-11 Sep-12 Sep-13 Sep-14 Sep-15 Sep-16 Sep-15 Sep-16 Investing Where It Counts # of Funds AUM Please see mutual fund disclaimer in the Disclosures section of this presentation. As of September 30, 2016 W # of Funds#1212 Investing Where It Counts Financial Highlights W#13Q3 2016 | Highlights 66 All our global equity and emerging markets strategies remained ahead of their respective benchmarks, with most strategies in the top quartiles of their peer groups. Assets Under Management Total AUM of $21.3 billion and AUA of $1.1 billion at September 30, 2016 Investment Strategies • • Strong performance for our Emerging Markets and Multi- Asset strategies. Appointed sub-advisor of the Aviva Global Convertibles Fund. The approximate $800 million in assets will transition to AUM upon approval by the Luxembourg fund regulator. Operating Results • Total revenues of $31.8 million for Q3 2016 Capital Management 1. 2. See the Reconciliation of Net Income to Economic Earnings on slide 16 of this presentation. As of October 25, 2016. 13 Investing Where It Counts • • Net income of $5.9 million and Economic Earnings of $10.6 million for Q3 2016 Quarterly dividend of $0.62 per share, an increase of 9%, declared in October 2016, at a current yield of 4.9%2 Liquid cash and investments of $80.5 million at September 30, 2016 W#141. 2. 3. Financial Trends | Annual Asset-based Advisory & Trust Fees ($ millions) Fee Revenue¹ - Historical 19% 5-year CAGR +18% $128.1 $109.0 $88.4 $67.7 $72.9 2011 2012 2013 2014 2015 Earnings and Dividends Per Share - Historical -3% Fee Revenue¹- QTD and YTD -5% $32.9 $31.1 Fee Revenue QTD 2015 -7% $97.4 $90.7 Fee Revenue YTD 2016 Earnings and Dividends Per Share - QTD and YTD $2.78 -34% +14% +14% $3.45 $3.33 $2.32 $1.96 $1.42 $1.65 $1.51 $1.64 -17% $1.84 $2.07 $1.82 $0.87 $0.50 +14% $0.72 $0.57 $1.71 $1.50 3 2 2011 2012 2013 2014 2015 QTD 2015 QTD 2016 YTD 2015 YTD 2016 GAAP Diluted EPS Dividends per share Asset-based fee revenue, excluding performance fees. 2015 GAAP Diluted EPS includes a $0.10 negative tax adjustment and an $0.08 non-cash compensation charge. 2016 GAAP Diluted EPS includes a $0.17 one-time information technology implementation costs charge, net of taxes. 14 Investing Where It Counts GAAP Diluted EPS Dividends per share W#15Shareholder Value Creation | Capital Management $ in millions $18 $16 $14 $12 $10 $8 $6 $4 $2 Annual Dividends Over $125 million of dividends paid out from 2002 to 2015 $0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 15 Investing Where It Counts Quarterly Dividends Special Dividends As of December 31, 2015 W#16Reconciliation of Net Income to Economic Earnings We provide a non-U.S. generally accepted accounting principles ("non-GAAP") performance measure that we refer to as Economic Earnings. We provide this measure in addition to, but not as a substitute for, net income reported on a U.S. generally accepted accounting principles ("GAAP") basis. Our management and the Board of Directors review Economic Earnings to evaluate our ongoing performance, allocate resources and review the dividend policy. We believe that this non-GAAP performance measure, while not a substitute for GAAP net income, is useful for management and investors when evaluating our underlying operating and financial performance and our available resources. We do not advocate that investors consider this non-GAAP measure without considering financial information prepared in accordance with GAAP. In calculating Economic Earnings, we add to net income the non-cash expense associated with equity-based compensation awards of restricted stock, amortization of intangible assets and deferred taxes related to the tax-basis amortization of goodwill. Although depreciation on property and equipment is a non-cash expense, we do not add it back when calculating Economic Earnings because depreciation charges represent a decline in the value of the related assets that will ultimately require replacement. The following table provides a reconciliation of net income to Economic Earnings for the three months ended September 30, 2016 ($ thousands): Net Income Add: Stock Based Compensation Expense 9/30/2016 5,887 4,082 Intangible Amortization 490 Tax Benefit from Goodwill Amortization 156 Economic Earnings $ 10,615 16 Investing Where It Counts W#1717 Investing Where It Counts Appendix W#18Westwood | Additional Strategic Initiatives Utilize Technology to Improve Work Flows and Data Management -Hired first Chief Information Officer -Upgraded Westwood Trust accounting system to provide consistency across offices and scalability for future offices -Migrated technology infrastructure to the Microsoft Azure cloud-based platform to improve performance, security, accessibility/mobility and disaster recovery -Converted trade order management system from Advent Moxy to Bloomberg AIM+ to better facilitate existing and future products -Completed first phase and initiated second phase of the data architecture program to improve security, management and business intelligence Enhance Marketing and Product Management Focus -Hired Head of Marketing and Product Management -Rebuilding strategic marketing content and branding initiatives to deliver a consistent client experience across channels -Increase and improve digital presence -Accelerate sales growth by supporting the Westwood brand globally Transparent Goal Setting & Accountability -Input solicited from every person in the company, members of the Board and senior management for agreed upon top goals for the firm -Internal scorecard developed for tracking progress: -Investment performance (relative & peer group) -Sales and client service (new sales & client retention) -Financial results (expense control/TSR/dividend growth) -Strategic goals (technology investment/strategic planning/growth initiatives) 18 Investing Where It Counts W#19Westwood | Changes to Executive Compensation Program • • Independent third party compensation consultant engaged New employment agreement for CEO which includes a three-year term, double-trigger change-in-control and no-gross up provisions for taxes Stock ownership guidelines adopted for the CEO (6x base salary) and certain other executives (3x base salary) and members of the Board of Directors (5x cash retainer) • Adopted a clawback policy • Modified CEO annual incentive plan from a fixed percentage of pre-tax income to a scorecard with multiple pre-established performance goals Modified CEO long-term incentive plan from a front-loaded five-year time-based equity award to annual performance-based with additional time- based vesting Developed anti-hedging and anti-pledging policies for executives and directors Implemented maximum caps on all incentive plans • Benchmark executives against industry survey data • • Updated peer group of companies to include: Prohibition against back-dating, re-pricing or retroactive equity awards Artisan Partners Asset Management, Inc. Cohen & Steers, Inc. Federated Investors, Inc. Janus Capital Group, Inc. OM Asset Management Plc Silvercrest Asset Management Group, Inc. Wisdom Tree Investments, Inc. Calamos Asset Management, Inc. Diamond Hill Investment Group, Inc. GAMCO Investors, Inc. Manning & Napier, Inc. Pzena Investment Management, Inc. Virtus Investment Partners, Inc. 19 Investing Where It Counts W#20Westwood | Track Record of Shareholder Value Creation Total Return Since 2002 Westwood Spin-off 5923.51% Diamond Hill Investment Group, Inc. Virtus Investment Partners, Inc. Westwood Holdings Group, Inc. Cohen & Steers, Inc. GAMCO Investors, Inc. Federated Investors, Inc. Silvercrest Asset Management Group, Inc. OM Asset Management Plc 865.7% 648.9% 446.2% 98.3% 61.8% 11.6% | 3.5% Janus Capital Group, Inc. -6.9% Artisan Partners Asset Management, Inc. -10.9% Manning & Napier, Inc. -24.7% Pzena Investment Management, Inc. -46.3% Calamos Asset Management, Inc. -48.9% -200% 0% 200% 400% 600% 800% 1000% Source: Bloomberg 20 20 Investing Where It Counts As of September 30, 2016 Past performance is not indicative of future results. W#21Westwood | Forward Looking Statements Statements in this presentation that are not purely historical facts, including, without limitation, statements about our expected future financial position, preliminary estimates, results of operations or cash flows, as well as other statements including, without limitation, words such as "anticipate," "believe," "plan," "estimate," "expect," "intend," "should," "could," "goal," "may," "target," "designed," "on track," "comfortable with," "optimistic" and other similar expressions, constitute 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. Actual results and the timing of some events could differ materially from those projected in or contemplated by the forward-looking statements due to a number of factors, including, without limitation, those set forth below: • • • • • • the composition and market value of our assets under management; regulations adversely affecting the financial services industry; competition in the investment management industry; our investments in foreign companies; our ability to develop and market new investment strategies successfully; our ability to pursue and properly integrate acquired businesses; litigation risks; • our ability to retain qualified personnel; • our relationships with current and potential customers; • • • • our ability to properly address conflicts of interest; our ability to maintain effective information systems; our ability to maintain effective cyber security; • our ability to maintain adequate insurance coverage; • our ability to maintain an effective system of internal controls; our ability to maintain our fee structure in light of competitive fee pressures; • our relationships with investment consulting firms; and • the significant concentration of our revenues in a small number of customers. Additional factors that could cause our actual results to differ materially from our expectations are discussed under the section entitled "Risk Factors" in our Form 10-K for the year ended December 31, 2015 and our quarterly reports on Form 10-Q for the quarters ended March 31, 2016, June 30, 2016, and September 30, 2016 which together with our other filings can be viewed at www.sec.gov. You should not unduly rely on these forward-looking statements. Except as required by law, we are not obligated to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this investor presentation or to reflect the occurrence of unanticipated events or otherwise. 21 Investing Where It Counts W#22Mutual Fund Disclaimer To determine if a mutual fund is an appropriate investment for you, carefully consider the Fund's investment objectives, risk factors, charges, and expenses before investing. This and other information can be found in the Fund's prospectus, which may be obtained by calling 1.877.FUND. WHG, or by visiting our website at www.westwoodfunds.com. Read the prospectus carefully before investing or sending money. The Westwood FundsⓇ are distributed by SEI Investments Distribution Co., which is not affiliated with the Adviser. Mutual fund investing involves risk, including possible loss of principal. There can be no assurance that the Fund will achieve its stated objective, which can be found in the prospectus, or that of the strategy. U.S. Value and Income Funds (I-Shares) Global and Emerging Markets Equity Funds (I-Shares) Name LargeCap Value Symbol Name Symbol WHGLX Emerging Markets WWEMX SMidCap SMidCap Plus WHGMX Global Equity WWGEX WHGPX Global Dividend WWGDX SmallCap Value WHGSX Strategic Global Convertibles WSGCX Dividend Growth WHGDX MLP and Strategic Energy WMLPX Income Opportunity WHGIX Worldwide Income Opportunity WWIOX Market Neutral Income WMNIX Short Duration High Yield WHGHX Opportunistic High Yield WWHYX 22 22 Investing Where It Counts W#23W Westwood HOLDINGS GROUP, INC © www.westwoodgroup.com 200 Crescent Court Suite 1200 Dallas, Texas 75201 T. 214.756.6900 WHG LISTED NYSE