Andrew C. Wiechmann
Chief Financial Officer at MSCI
Thanks, Baer, and hi, everyone. In the first quarter, we delivered double-digit organic revenue growth, 11% adjusted EBITDA growth and 12% adjusted EPS growth. We delivered 10% organic revenue growth as well as record asset-based fee revenue driven by record AUM balances in ETF and non-ETF products linked to MSCI indexes. The solid financial performance highlights the resilience of our business model even in the face of headwinds reflected in our operating metrics. As we have mentioned previously, we are seeing the impact of a slow moving business cycle as the prolonged period of muted flows into active equity strategies have resulted in a lengthening of sales cycles and in this quarter a concentration of client events on top of what is typically a seasonally softer quarter for us.
To provide a bit more color, if we compare our cancels to the first quarter of 2023, the two product segments with the biggest increases were index and ESGF and climate. Within index, nearly the entirety of the increase were roughly $7 million of the increase related to a higher contribution from corporate defense. From a client segment lens and index, $5.2 million of the year-over-year increase in cancels came within the broker, dealer and hedge fund client segments, including roughly $4 million from the previously mentioned large global bank merger. Similarly, within ESG and climate, nearly $4 million or 80% of the increase in cancels came from a higher level of corporate events, including $2.5 million from the large global bank merger event.
The large majority of cancels related to this global bank merger occurred in Q1 although there could be some smaller items that come through in future quarters that the integration is completed. Across all product segments, the retention rate with asset owners and asset managers was a 95% and 97%, respectively. While we do expect some elevated level of client events to continue in the near-term, we do not expect to see cancels continue at this level in the coming quarters and we expect retention rates to rebound through the year. Additionally, we have a solid pipeline of new sales opportunities.
In index, we had 8% subscription run rate growth in our market cap weighted modules and 19% growth in custom indexes and special packages. As a reminder, in Q2 of last year, we had a large non-recurring revenue item related to unlicensed usage of our indexes, which drove an unusually large level of non-recurring revenue. ABF revenues were up 13% year-over-year benefiting from about $21 billion of cash inflows and about $93 billion of market appreciation so far in 2024 within ETFs link to MSCI equity indexes. Most of the MSCI linked ETF flows were in developed markets outside the U.S. in emerging markets products, which together were over $22 billion.
In analytics, organic subscription run rate growth was 7%, which reflects the benefits from the investments we've made in the innovation, such as our next-gen models and our insights offering. These have helped us to drive strong sales and enterprise risk in multi-asset class models across client segments. We also had several client wins in fixed income analytics. Analytics revenue this quarter included a large contribution from catchup revenue items, much of which related to large client implementations. In our ESG and climate reportable segment, organic run rate growth was 13%, which excluded about $4.8 million of run rate from Trove and the impact of FX and run rate growth for the reportable ESG and climate segment was nearly 18% within Europe and close to 22% in Asia, while the Americas growth was 9%.
In real assets, run rate growth was about 4% with subdued net new subscription sales continuing to reflect lower transaction activity and other commercial real estate pressures. We continued to be pleased with our progress on the integration of Burgiss, which as a reminder is referred to as the private capital solutions operating segment within our all other private assets reportable segment. Retention was strong at nearly 96% and contributed over $24 million of revenue for the quarter. We continue to have a vigilant focus on disciplined capital allocation and our cash balance at the end of March was over $500 million, including readily available cash in the U.S. of over $200 million.
Last week, we closed on the acquisition of Foxberry for approximately $22 million of upfront consideration. The transaction also has the potential for additional performance-related payments tied to the achievement of key milestones. Our 2024 guidance across all categories remains unchanged and assumes that AUM declines slightly in Q2 and rebounds gradually in the second half of the year. I would note that our first quarter effective tax rate of 13.5% benefited from favorable discrete items and higher excess tax benefits recognized on stock-based comp vested in the period. For the remainder of the year, we expect the quarterly effective tax rate of 21% to 22% each quarter before any discrete items. Overall, our client centricity and multiyear investments position us well to drive growth throughout 2024 and we look forward to keeping you posted on our progress.
With that operator, please open the line for questions.
