DALLAS, July 26 /PRNewswire-FirstCall/ -- Westwood Holdings Group, Inc. (NYSE: WHG) today announced that its Board of Directors has approved the payment of a quarterly cash dividend of $0.09 per common share, an increase of 12.5% from the previous quarterly dividend of $0.08 per share. The Board has also approved the payment of a special cash dividend of $0.75 per share in order to return excess cash to our stockholders. Both the quarterly and special dividends will be payable on October 3, 2005 to stockholders of record on September 15, 2005.

Westwood also today reported 2005 second quarter revenues of $5.3 million, net income of $937,000 and earnings per diluted share of $0.17. This compares to revenues of $4.9 million, net income of $988,000 and earnings per diluted share of $0.18 in the second quarter of 2004. For the six months ended June 30, 2005, Westwood reported revenues of $10.3 million and net income of $1.8 million, or $0.32 per diluted share, compared to revenues of $10.0 million and net income of $2.1 million, or $0.39 per diluted share, for the same 2004 period.

Total expenses for the second quarter of 2005 were $3.7 million compared to $3.3 million for the second quarter of 2004, an increase of approximately $386,000. Employee compensation and benefits costs increased by approximately $334,000 compared to the 2004 second quarter, primarily due to higher restricted stock expense as a result of our continued efforts to build the firm for future growth. Information technology expense increased by approximately $32,000 primarily as a result of increased software costs, including the cost to implement a new customer relationship management system that will enhance our ability to manage our client relationships and prospect pipeline. Professional services costs increased by approximately $27,000 primarily as a result of higher professional fees related to external audit and Sarbanes-Oxley compliance as well as higher subadvisory fees due to increased assets under management at Westwood Trust.

Assets under management were $4.3 billion as of June 30, 2005, an increase of 11.3% compared to $3.8 billion on June 30, 2004. Average assets under management for the first six months of 2005 were $4.2 billion, an increase of 8.2% compared with the first half of 2004. The increase in period ending assets under management was principally attributable to market appreciation of assets under management and asset inflows from new clients, partially offset by the withdrawal of assets by certain clients.

Susan M. Byrne, Westwood's founder and Chief Executive Officer commented, "While costs associated with restricted stock have penalized near term earnings, we are confident that this form of compensation strongly aligns the interests and incentives of our employees with our clients and stockholders and provides the foundation for growth and stronger results in the future."

Brian O. Casey, Westwood's President and Chief Operating Officer added, "We are pleased to have received a meaningful placement in the second quarter from a new client in our SMidCap Value product, which continues to gain scale and traction in the institutional marketplace and now has $300 million in assets under management. We are especially gratified by this win, as it resulted from a long-standing relationship with an institutional consulting firm that knows our people and process well and was introduced to this new product by our recent institutional marketing efforts around this product. We believe our SMidCap product represents a meaningful opportunity to grow our institutional assets. We continue to look for ways to grow our business through our continuing focus on strong product performance produced by our proprietary research and investment process, increased targeted marketing efforts and exploration of enhanced distribution opportunities."

About Westwood

Westwood Holdings Group, Inc. manages investment assets and provides services for its clients through two subsidiaries, Westwood Management Corp. and Westwood Trust. Westwood Management Corp. is a registered investment advisor and provides investment advisory services to corporate pension funds, public retirement plans, endowments and foundations, mutual funds and clients of Westwood Trust. Westwood Trust provides, to institutions and high net worth individuals, trust and custodial services and participation in common trust funds that it sponsors. Westwood Holdings Group, Inc. trades on the New York Stock Exchange under the symbol "WHG". For more information, please visit the Company's website at http://www.westwoodgroup.com .

Note on Forward-looking Statements

Statements that are not purely historical facts, including statements about anticipated or expected future revenue and earnings growth and profitability, as well as other statements including words such as "anticipate," "believe," "plan," "estimate," "expect," "intend," "should," "could," "goal," "target," "designed," "on track," "continue," "comfortable with," "optimistic," "look forward to" 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. These forward-looking statements are subject to known and unknown risks, uncertainties and other factors, which may cause actual results to be materially different from those contemplated by the forward-looking statements. Such factors include the risks and uncertainties referenced in our documents filed with, or furnished to, the Securities and Exchange Commission, including without limitation those identified under the caption "Forward-Looking Statements and Risk Factors" in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Readers are cautioned not to place undue reliance on forward- looking statements.

                WESTWOOD HOLDINGS GROUP, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF INCOME
                   (in thousands, except per share amounts)
                                 (unaudited)


                               Three months ended        Six months ended
                                   June 30,                  June 30,
                              2005         2004         2005         2004
    REVENUES:
       Advisory fees         $3,309       $3,249       $6,500       $6,669
       Trust fees             1,668        1,442        3,371        2,894
       Other revenues           276          249          464          420
          Total revenues      5,253        4,940       10,335        9,983

    EXPENSES:
      Employee compensation
       and benefits           2,681        2,347        5,279        4,684
      Sales and marketing       145          148          227          248
      Information technology    192          160          377          332
      Professional services     274          247          593          471
      General
       and administrative       435          439          912          820
       Total expenses         3,727        3,341        7,388        6,555
    Income before
     income taxes             1,526        1,599        2,947        3,428
    Provision
     for income taxes           589          611        1,135        1,323
    Net income                 $937         $988       $1,812       $2,105

    Earnings per share:
      Basic                   $0.17        $0.18        $0.33        $0.39
      Diluted                 $0.17        $0.18        $0.32        $0.39



                WESTWOOD HOLDINGS GROUP, INC. AND SUBSIDIARIES

                         CONSOLIDATED BALANCE SHEETS
                  As of June 30, 2005 and December 31, 2004
             (in thousands, except par values and share amounts)
                                 (unaudited)

                                                       June 30,   December 31,
                                                         2005           2004
                              ASSETS

    Current Assets:
      Cash and cash equivalents                         $1,656           $720
      Accounts receivable                                1,966          1,832
      Investments, at market value                      18,532         18,632
      Other current assets                                 221            414
        Total current assets                            22,375         21,598
      Goodwill                                           2,302          2,302
      Deferred income taxes                                818            517
      Property and equipment, net of accumulated
       depreciation of $385 and $250                     1,723          1,860
        Total assets                                   $27,218        $26,277


          LIABILITIES AND STOCKHOLDERS' EQUITY

    Current Liabilities:
      Accounts payable and accrued liabilities            $612           $629
      Dividends payable                                    461            460
      Compensation and benefits payable                  1,577          2,703
      Income taxes payable                                  87            ---
      Other current liabilities                              6             17
        Total current liabilities                        2,743          3,809
    Deferred rent                                          815            805
        Total liabilities                                3,558          4,614

    Stockholders' Equity:
      Common stock, $0.01 par value,
       authorized 10,000,000 shares, issued and
       outstanding 5,759,397 shares
       at June 30, 2005; issued and outstanding
       5,754,147 shares at December 31, 2004                58             58
      Additional paid-in capital                        17,128         16,962
      Unamortized stock compensation                    (3,881)        (4,821)
      Retained earnings                                 10,355          9,464
        Total stockholders' equity                      23,660         21,663

    Total liabilities and stockholders' equity         $27,218        $26,277

     Investor Relations
     (214) 756-6900