NEW YORK, April 23 /PRNewswire-FirstCall/ -- AllianceBernstein
Holding L.P. ("AllianceBernstein Holding") (NYSE:AB) and
AllianceBernstein L.P. ("AllianceBernstein") today reported
financial and operating results for the quarter ended March 31,
2008. AllianceBernstein Holding (The Publicly Traded Partnership):
-- Diluted net income per Unit for the quarter ended March 31, 2008
was $0.83, a decrease of 9% from $0.91 for the same period in 2007.
-- Distribution per Unit for the first quarter of 2008 will be
$0.83, a decrease of 9% from $0.91 for the same period in 2007. The
distribution is payable on May 15, 2008 to holders of record of
AllianceBernstein Holding Units at the close of business on May 5,
2008. AllianceBernstein (The Operating Partnership): -- Assets
Under Management (AUM) at March 31, 2008 were $735 billion, a 1%
decrease from a year ago, due to market depreciation partially
offset by net inflows. -- Net outflows for the three months ended
March 31, 2008 were $1.5 billion, consisting of Retail net outflows
of $4.4 billion, Institutional Investments net inflows of $2.5
billion and Private Client net inflows of $0.4 billion. -- Net
inflows for the twelve months ended March 31, 2008 were $17.3
billion, consisting of Institutional Investments net inflows of
$13.9 billion, Private Client net inflows of $5.4 billion and
Retail net outflows of $2.0 billion. "Turbulent capital market
conditions negatively impacted first quarter results for our
clients and the firm. Absolute investment returns were weak across
our entire equity and hedge fund service suite. With few
exceptions, returns in these services trailed benchmarks as we
implemented strategies to gradually increase exposure to
investments depressed in price as a consequence of the current
market turmoil. Such investments are believed to offer unusual
opportunity but hurt returns in the quarter. Fixed income
portfolios generally produced positive returns, providing important
ballast to client portfolios. While relative returns were generally
below targets in core and core plus services, virtually all of our
municipal bond services outperformed," said Lewis Sanders, Chairman
and Chief Executive Officer. "The firm's organic growth turned
slightly negative in the first quarter. Net redemptions in our
retail channel, focused heavily in non-U.S. markets, were partially
offset by net inflows in the institutional and private client
channels. However, net inflows in both channels slowed sharply
compared to recent periods, as many clients await greater clarity
about the underlying factors creating current market volatility.
Although the backlog of new institutional mandates not yet funded
grew to over $16 billion--a historically robust amount--a firm-wide
resumption of organic growth will likely be contingent upon an
improvement in capital market conditions. "Our Institutional
Research Services unit was a bright spot in the first quarter, with
revenues rising by 20% versus last year's comparable quarter.
Results were especially strong in the U.S., reflecting continued
client acceptance of our research and trading platforms. "Despite a
5% increase in advisory fee revenue, net revenue for the quarter
declined by 1% versus last year's comparable period. This decline
was primarily driven by a negative swing of $78 million in
investment gains and losses (equating to nearly 8% of net
revenues), which largely stemmed from a $58 million decline in the
value of investments related to employee deferred compensation
plans. These lower valuations also reduced compensation expense by
$20 million and will result in lower compensation expense in future
periods should the value of these investments not recover. The
decline in valuations resulted in a net reduction in first quarter
2008 earnings per Unit of approximately $0.13. In addition, current
quarter earnings were reduced by $0.04 per Unit for costs incurred
to conclude certain employee-related arbitrations, a significant
portion of which we believe will be recovered from insurance.
Despite the impact of these items and slowing revenue growth in
general, operating income declined by less than 5% and our
operating margin declined by less than 100 basis points to 26.5%,
both helped by ongoing expense management initiatives. Also
contributing to the 8% year-over-year decline in net income was a
higher effective tax rate this quarter due to the continuing shift
of the firm's profits to regions outside the U.S. where taxes are
higher. "As we noted at year end 2007, turbulence in the capital
markets, while unsettling, does plant the seeds for better future
absolute and relative investment returns. We are working hard to
capture these opportunities for clients, the success of which will
redound to the benefit of all the stakeholders of
AllianceBernstein," concluded Mr. Sanders. CONFERENCE CALL
INFORMATION RELATING TO FIRST QUARTER 2008 RESULTS April 23, 2008
at 5:00 P.M. (Eastern Daylight Time) AllianceBernstein's management
will review first quarter 2008 financial and operating results on
Wednesday, April 23, 2008, during a conference call beginning at
5:00 p.m. (EDT), following the release of its financial results
after the close of the New York Stock Exchange. The conference call
will be hosted by Lewis A. Sanders, Chairman and Chief Executive
Officer, and Gerald M. Lieberman, President and Chief Operating
Officer. Parties may access the conference call by either webcast
or telephone: 1. To listen by webcast, please visit
AllianceBernstein's Investor Relations website at
http://ir.alliancebernstein.com/investorrelations at least 15
minutes prior to the call to download and install any necessary
audio software. 2. To listen by telephone, please dial (866)
556-2265 in the U.S. or (973) 935-8521 outside the U.S., 10 minutes
before the 5:00 p.m. (EDT) scheduled start time. The conference ID#
is 42356263. The presentation that will be reviewed during the
conference call will be available on AllianceBernstein's Investor
Relations website shortly after the release of first quarter 2008
financial results on April 23, 2008. An audio replay of the
conference call will be available beginning at approximately 7:00
p.m. (EDT) on April 23, 2008 and will be available for one week. To
access the audio replay, please call (800) 642-1687 from the U.S.,
or outside the U.S. call (706) 645-9291, and provide conference ID#
42356263. The replay will also be available via webcast on
AllianceBernstein's website for one week. About AllianceBernstein
AllianceBernstein is a leading global investment management firm
that offers high-quality research and diversified investment
services to institutional clients, individuals and private clients
in major markets around the world. AllianceBernstein employs more
than 500 investment professionals with expertise in growth
equities, value equities, fixed income securities, blend strategies
and alternative investments and, through its subsidiaries and joint
ventures, operates in more than 20 countries. AllianceBernstein's
research disciplines include fundamental research, quantitative
research, economic research and currency forecasting. Through its
integrated global platform, AllianceBernstein is well-positioned to
tailor investment solutions for its clients. AllianceBernstein also
offers in-depth, fundamental, independent research, as well as
portfolio strategies, trading and brokerage-related services to its
institutional investor clients. At March 31, 2008,
AllianceBernstein Holding L.P. ("Holding") owned approximately
33.5% of the issued and outstanding AllianceBernstein Units. AXA
Financial was the beneficial owner of approximately 62.7% of the
AllianceBernstein Units at March 31, 2008 (including those held
indirectly through its ownership of approximately 1.7% of the
issued and outstanding Holding Units) which, including the general
partnership interests in AllianceBernstein and Holding, represent
an approximate 63.1% economic interest in AllianceBernstein. AXA
Financial is a wholly-owned subsidiary of AXA, one of the largest
global financial services organizations. Cautions regarding
Forward-Looking Statements Certain statements provided by
management in this news release are "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act
of 1995. Such forward-looking statements are subject to risks,
uncertainties, and other factors that could cause actual results to
differ materially from future results expressed or implied by such
forward- looking statements. The most significant of these factors
include, but are not limited to, the following: the performance of
financial markets, the investment performance of sponsored
investment products and separately managed accounts, general
economic conditions, future acquisitions, competitive conditions,
and government regulations, including changes in tax regulations
and rates and the manner in which the earnings of publicly traded
partnerships are taxed. We caution readers to carefully consider
such factors. Further, such forward looking statements speak only
as of the date on which such statements are made; we undertake no
obligation to update any forward-looking statements to reflect
events or circumstances after the date of such statements. For
further information regarding these forward-looking statements and
the factors that could cause actual results to differ, see "Risk
Factors" in Item 1A of our 2007 Form 10-K. Any or all of the
forward-looking statements that we make in this news release, Form
10-K or any other public statements we issue may turn out to be
wrong. It is important to remember that other factors besides those
listed in "Risk Factors" and those listed below could also
adversely affect our revenues, financial condition, results of
operations, and business prospects. The forward-looking statements
referred to in the preceding paragraph include statements
regarding: -- Current market turmoil offering unusual investment
opportunity, and a firm-wide resumption of organic growth: The
actual performance of the capital markets and other factors beyond
our control will affect our investment success for clients and
asset flows. -- Our backlog of new institutional mandates not yet
funded growing to over $16 billion: Before they are funded,
institutional mandates do not represent legally binding commitments
to fund and, accordingly, the possibility exists that not all
mandates will be funded in the amounts and at the times we
currently anticipate. -- Lower compensation expense in future
periods resulting from a decline in the value of investments
related to employee deferred compensation plans: The actual
performance of the capital markets and other factors beyond our
control will affect the value of these investments. -- Our ability
to recover a significant portion of costs incurred to conclude
employment-related arbitrations: Our ability to recover a
significant portion of these costs depends on the willingness of
our insurer to reimburse us under an existing policy.
ALLIANCEBERNSTEIN L.P. (THE OPERATING PARTNERSHIP) SUMMARY
CONSOLIDATED STATEMENTS OF INCOME MARCH 31, 2008 (unaudited, $
thousands) Three Months Ended ------------------------------
3/31/08 3/31/07 ----------- ------------ Revenues: Investment
Advisory & Services Fees $817,231 $775,487 Distribution
Revenues 109,302 112,210 Institutional Research Services 118,286
98,956 Dividend and Interest Income 30,992 68,309 Investment Gains
(Losses) (64,230) 13,634 Other Revenues 30,780 29,795 -----------
------------ Total Revenues 1,042,361 1,098,391 Less: Interest
Expense 13,339 54,055 ----------- ------------ Net Revenues
1,029,022 1,044,336 ----------- ------------ Expenses: Employee
Compensation & Benefits 433,672 440,525 Promotion &
Servicing: Distribution Plan Payments 79,224 77,710 Amortization of
Deferred Sales Commissions 22,019 24,715 Other 57,223 58,529
General & Administrative 152,404 143,767 Interest on Borrowings
6,565 7,482 Amortization of Intangible Assets 5,179 5,179
----------- ------------ 756,286 757,907 ----------- ------------
Operating Income 272,736 286,429 Non-Operating Income 4,752 4,199
----------- ------------ Income before Income Taxes 277,488 290,628
Income Taxes 30,045 22,927 ----------- ------------ NET INCOME
$247,443 $267,701 =========== ============ Operating Income Margin
26.5% 27.4% ALLIANCEBERNSTEIN HOLDING L.P. (THE PUBLICLY TRADED
PARTNERSHIP) SUMMARY STATEMENTS OF INCOME (unaudited, $ thousands
except per unit amounts) Three Months Ended
------------------------------ 3/31/08 3/31/07 -----------
------------ Equity in Earnings of Operating Partnership $81,997
$87,834 Income Taxes 9,561 9,309 ----------- ------------ NET
INCOME 72,436 78,525 Additional Equity in Earnings of Operating
Partnership(1) 170 1,269 ----------- ------------ NET INCOME -
Diluted(2) $72,606 $79,794 =========== ============ DILUTED NET
INCOME PER UNIT $0.83 $0.91 =========== ============ DISTRIBUTION
PER UNIT $0.83 $0.91 =========== ============ (1) To reflect higher
ownership in the Operating Partnership resulting from application
of the treasury stock method to outstanding options. (2) For
calculation of Diluted Net Income per Unit. ALLIANCEBERNSTEIN AND
ALLIANCEBERNSTEIN HOLDING UNITS OUTSTANDING AND WEIGHTED AVERAGE
UNITS OUTSTANDING MARCH 31, 2008 Weighted Average Units Three
Months Ended ---------------------------- Period End Units Basic
Diluted ------------- ------------- --------------
AllianceBernstein 260,798,798 260,627,159 260,943,171
AllianceBernstein Holding 87,404,955 87,233,316 87,549,328
ALLIANCEBERNSTEIN L.P. ASSETS UNDER MANAGEMENT THREE MONTHS ENDED
MARCH 31, 2008 ($ millions) Institutional Private Investments
Retail Client Total ------------ --------- --------- ---------
Beginning of Period $508,081 $183,165 $109,144 $800,390 Sales/New
accounts 12,162 7,820 3,330 23,312 Redemptions/Terminations (3,655)
(10,328) (1,859) (15,842) Cash flow (5,916) (1,672) (1,029) (8,617)
Unreinvested dividends - (239) (114) (353) ------------ ---------
--------- --------- Net inflows/(outflows) 2,591 (4,419) 328
(1,500) Transfers(1) (41) 41 - - Market depreciation (39,304)
(16,076) (8,179) (63,559) ------------ --------- ---------
--------- End of Period $471,327 $162,711 $101,293 $735,331
============ ========= ========= ========= (1) Transfers of certain
client accounts were made among distribution channels resulting
from changes in how these accounts are serviced by the firm.
ALLIANCEBERNSTEIN L.P. ASSETS UNDER MANAGEMENT TWELVE MONTHS ENDED
MARCH 31, 2008 ($ millions) Institutional Private Investments
Retail Client Total ------------ --------- --------- ---------
Beginning of Period(1) $468,453 $172,998 $100,339 $741,790
Sales/New accounts 63,519 41,125 15,744 120,388
Redemptions/Terminations (28,845) (37,900) (5,318) (72,063) Cash
flow (20,805) (3,916) (4,498) (29,219) Unreinvested dividends (1)
(1,272) (521) (1,794) ------------ --------- --------- ---------
Net inflows/(outflows) 13,868 (1,963) 5,407 17,312 Transfers(2) 509
(511) 2 - Market depreciation (11,503) (7,813) (4,455) (23,771)
------------ --------- --------- --------- End of Period $471,327
$162,711 $101,293 $735,331 ============ ========= =========
========= (1) Prior period AUM has been adjusted to reflect the
assets associated with existing services previously not included.
(2) Transfers of certain client accounts were made among
distribution channels resulting from changes in how these accounts
are serviced by the firm. ALLIANCEBERNSTEIN L.P. ASSETS UNDER
MANAGEMENT BY INVESTMENT SERVICE AT MARCH 31, 2008 ($ millions)
Institutional Private Investments Retail Client Total ------------
--------- --------- --------- Equity: Value U.S. $42,932 $28,881
$22,197 $94,010 Global & International 174,808 50,185 22,759
247,752 ------------ --------- --------- --------- 217,740 79,066
44,956 341,762 ------------ --------- --------- --------- Growth
U.S. 26,827 20,499 13,727 61,053 Global & International 77,768
20,163 11,067 108,998 ------------ --------- --------- ---------
104,595 40,662 24,794 170,051 ------------ --------- ---------
--------- Total Equity 322,335 119,728 69,750 511,813 ------------
--------- --------- --------- Fixed Income: U.S. 73,370 9,540
30,745 113,655 Global & International 58,661 29,572 765 88,998
------------ --------- --------- --------- 132,031 39,112 31,510
202,653 ------------ --------- --------- ---------
Index/Structured: U.S. 10,943 3,871 24 14,838 Global &
International 6,018 - 9 6,027 ------------ --------- ---------
--------- 16,961 3,871 33 20,865 ------------ --------- ---------
--------- Total: U.S. 154,072 62,791 66,693 283,556 Global &
International 317,255 99,920 34,600 451,775 ------------ ---------
--------- --------- $471,327 $162,711 $101,293 $735,331
============ ========= ========= ========= ALLIANCEBERNSTEIN L.P.
ASSETS UNDER MANAGEMENT ($ millions) Three Month Period Twelve
Month Period ----------------------- -----------------------
3/31/08 3/31/07(1) 3/31/08 3/31/07(1) ---------- -----------
---------- ----------- Ending Assets Under Management $735,331
$741,790 $735,331 $741,790 Average Assets Under Management $758,359
$726,810 $781,568 $671,525 (1) Prior period AUM has been adjusted
to reflect the assets associated with existing services previously
not included. ALLIANCEBERNSTEIN L.P. ASSETS UNDER MANAGEMENT BY
CLIENT DOMICILE AT MARCH 31, 2008 ($ millions) Institutional
Private Investments Retail Client Total ------------ ---------
--------- --------- U. S. Clients $218,841 $124,233 $97,846
$440,920 Non-U.S. Clients 252,486 38,478 3,447 294,411 ------------
--------- --------- --------- $471,327 $162,711 $101,293 $735,331
============ ========= ========= ========= DATASOURCE:
AllianceBernstein L.P. CONTACT: Philip Talamo, Investor Relations,
+1-212-969-2383, , or John Meyers, Media, +1-212-969-2301, Web
site: http://ir.alliancebernstein.com/investorrelations
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