Andy Wiechmann
Chief Financial Officer at MSCI
Thanks, Baer, and hi, everyone. As you can see from our results, we have a highly resilient business that continues to generate consistently strong performance across product areas and client segments despite cyclical pressures.
In Index, we had nearly 11% subscription run rate growth, including 9% run rate growth in our market cap-weighted modules and 20% growth in custom indexes and special packages. Sector and ESG modules grew 11%, a slower rate than last year as clients are favoring more customized approaches and we saw fewer clients launching new active factor strategies. We have a demonstrated track record of growing with our existing client base in Index, helping them unlock value through a wide range of use cases across a broad range of content.
Half of our Index client base subscribes to at least two or more modules with 20% of clients licensing as many as five or more different modules. Our growing set of modules across market cap, sector, ESG, climate, thematic, fixed income and custom dimensions enable us to continue to bring additional value to our clients. And we maintain solid momentum in asset-based fees with revenues up 16% year-over-year, benefiting from over $48 billion of cash inflows and about $198 billion of market appreciation throughout 2023 within ETFs linked to MSCI equity indexes.
During Q4, cash inflows of $16 billion into equity ETFs linked to MSCI indexes were mostly driven by developed markets ex-U.S. and emerging markets products. From a product perspective, we saw inflows of about $6 billion into equity ETFs linked to MSCI ESG and Climate indexes, which represented the majority of industry flows into ESG and Climate products.
Within fixed income ETFs, AUM and products linked to MSCI and Bloomberg joint fixed income indexes reached $60 billion, growing more than 30% year-over-year. We had another very strong quarter for non-recurring revenues. Roughly $16 million [Phonetic] of the non-recurring sales and revenues in Index were related to client fees for unlicensed usage of our content in historical periods.
We also earned non-recurring revenues from other common use cases, including licenses to create structured products and OTC derivatives and index history sales, where client requires decades of historical data to back-test strategies and conduct research.
In Analytics, we saw continued momentum across key areas with subscription run rate growth of 7% supported by strong net new recurring sales growth of 68%. Analytics revenue also benefited from a large number of implementations that were completed in the quarter, which resulted in both elevated non-recurring revenue and the release of recurring subscription revenue that was on hold during the respective implementation periods.
In our ESG and Climate reportable segment, organic run rate growth was 16%, which excludes about $4.5 million of run rate from Trove and the impact of FX. Run rate growth was approximately 15% in ESG research and 31% in Climate, excluding the impact of Trove. And run rate growth was 25% within Europe and close to 20% in Asia for ESG and Climate segment.
We continue to see strong engagement across client types with a retention rate of 94.7% for the quarter and 95.9% for the full year. Although we did see an increase in cancels from smaller clients, in large part related to an elevated level of client events, within Real Assets, run rate growth was 6% as we continue to see the impact of muted property values and lower transaction volumes.
The retention rate of 89% for the quarter was impacted by a pickup in cancels from small clients, namely brokers, developers and lenders, who are most acutely feeling these cyclical pressures, although once again our larger clients tended to have higher retention rates. Almost 80% of clients that subscribed to our RCA product offering spent over $50,000 per year on average, and the retention rate of that cohort is 96% for the full year of 2023.
Also, it is worth highlighting that about 95% of client contracts for RCA products have an auto-renew provision or multiyear contracts. Our integration of Burgiss, which we now refer to as our Private Capital Solutions operating segment is doing well. We recorded approximately $25 million of revenue for the quarter, which came in at the high end of our initial expectations, although we did benefit from revenue catch-ups resulting from the completion of implementation on our total planned product offering.
Private Capital Solutions expenses included about $4 million of allocations from centralized and shared costs. We continue to expect about $4 million to $5 million per quarter of these allocations to the segment. These costs are reallocated from other segments, and as a result will not impact firm-wide EBITDA.
Our approach to capital allocation remains unchanged. We will continue to invest in the business to drive strong top line growth over the long term while continuing to deliver attractive free cash flow and EPS growth. We will continue to optimize our capital structure, return excess cash to shareholders through regular dividends that grow with adjusted EPS and opportunistically pursue share buybacks and value-generative bolt-on M&A that accelerates our strategy in key growth areas.
In the spirit of continually optimizing our capital structure, last week we completed the refinancing of our credit facilities, where we replaced our term loan A and existing revolver with a new revolver that provides us with more capacity at $1.25 billion in total size, slightly lower costs than the now retired term loan A and an extended tenor. And our capital position remains solid overall.
As of today, we currently have approximately $600 million of cash on hand, well above our minimum global cash balance range, although cash balances are still down from last year's levels, which will continue to translate through to lower interest income.
Lastly, we continue to execute bolt-on acquisitions that accelerate our long-term strategy. Total purchase consideration for Trove and Fabric was approximately $48 million with the potential for additional performance-related payments tied to the achievement of top line growth targets, although the majority of those payments will be treated as compensation expense.
Turning to our 2024 guidance, which we published earlier this morning, our guidance assumes that AUM levels remain relatively flat to year-end levels through the first half of 2024 with a modest upturn in the second half of the year. Our expenses reflect the ongoing investments in our business as well as the impact of our acquisitions of Burgiss, Trove and Fabric.
Our capex guidance reflects continued software development to build or enhance our offerings across all of our segments, including Private Capital Solutions as well as slightly higher hardware purchases related to our hybrid data center strategy.
Our interest expense guidance reflects the refinancing of our credit facilities and assumes the existing balance of approximately $340 million remains outstanding for the year. Our tax rate guidance reflects the impact of the OECD global minimum tax, which goes into effect this year, statutory rate increases we are subject to in certain jurisdictions and a slightly smaller projected impact from windfall benefits.
I would like to highlight that our effective rate in the fourth quarter included a discrete benefit related to a favorable outcome on a tax position received late in the quarter. And lastly, free cash flow guidance reflects the expectation of slightly higher cash taxes.
Overall, we remain well positioned to drive growth, our client-centricity and multiyear investments position us for strength to start 2024, and we look forward to keeping you posted on our progress.
With that, operator, please open the line for questions.
