Affiliated Managers Group 4Q profit sharply higher

Affiliated Managers Group posts sharply higher 4Q profit as investment clients add cash

Associated Press

BOSTON (AP) -- Affiliated Managers Group Inc. on Tuesday posted sharply higher fourth-quarter earnings as clients added cash to the boutique investment management firms that the company invests in.

Affiliated Managers reported net income of $75 million, or $1.40 per share, up from $40.3 million, or 77 cents per share, in the same quarter a year ago.

Excluding one-time costs, economic earnings per share were $2.55, up from $1.76 in the previous year's fourth quarter.

Fourth-quarter revenue rose 22 percent to $491 million from $402.4 million. The company generates revenue from investments in managers of mutual funds and from firms that manage portfolios for institutions and wealthy individuals.

The latest quarter's economic earnings topped the $2.43 per share consensus estimate of analysts surveyed by FactSet. But revenue fell short of analysts' expectations for $528.8 million.

Economic earnings exclude some expenses, such as amortization and deferred taxes related to intangible assets. Affiliated Managers considers economic earnings a key measure of performance because it represents operating performance before certain expenses tied to acquisitions of interests in affiliated management firms.

The company, based in Prides Crossing, Mass., said net client cash flows for the latest quarter were $5.1 billion, and $30.1 billion for the full year. Assets under management as of Dec. 31 were $431.77 billion, up from $416.11 billion at the end of September and $327.46 billion at the end of 2011.

Affiliated Managers said it continues to benefit from demand from global institutional clients for emerging markets stocks and alternative investments, which generate about 70 percent of its earnings.

Shares of AMG fell 30 cents to $144.77 in afternoon trading. The stock has traded as high as $145.89 and as low as $94.32 over the past 12 months.

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