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GAMCO Investors, Inc. Reports Third Quarter Results

Stocks in this article: GBL

GAMCO Investors, Inc. (GAMCO) (NYSE: GBL) announced third quarter 2012 earnings of $19.0 million or $0.72 per fully diluted share versus $7.7 million or $0.29 per fully diluted share in the third quarter 2011. Third quarter 2012 earnings include a charge of $2.1 million or $0.08 per diluted share, (net of management fee and tax benefit), for the Dutch Auction of the 0% coupon notes (extinguishment of debt).

Revenues in the third quarter of 2012 were $82.2 million, including incentive fees of $0.8 million, up $2.0 million, or 2.6%, from $80.2 million, including $1.0 million in incentive fees, in the prior year quarter. Operating income before management fee was $32.1 million, a 0.1% increase from the $32.0 million in the prior year period as operating margin before management fee fell slightly to 39.0% from 40.0%.

For the nine months ended September 30, 2012, earnings were $57.9 million or $2.19 per fully diluted share versus $46.0 million or $1.72 per fully diluted share in 2011. The first nine months of 2011 had $5.6 million, or $0.12 per diluted share, of one-time costs directly related to the launch of a new closed-end fund.

 
Financial Highlights           Third Quarter       Year-to-date
($'s in 000's except AUM and per share data) 2012   2011    

% ∆

2012     2011    

% ∆

 
AUM (in millions) $ 36,945 $ 31,342 17.9 % $ 36,945 $ 31,342 17.9 %
Revenues 82,231 80,151 2.6 245,004 242,137 1.2
Operating income:
before management fee 32,068 32,048 0.1 96,246 90,044 6.9
after management fee 29,012 30,661 (5.4 ) 86,391 81,918 5.5
Operating margin:
before management fee 39.0 % 40.0 % 39.3 % 37.2 %
after management fee 35.3 % 38.3 % 35.3 % 33.8 %
Extinguishment of debt (6,305 ) - n/m (6,307 ) - n/m
Other income/(expense), net (1,446 ) (a) (18,747 ) n/m 2,446 (8,811 ) n/m
Net income attributable to GAMCO 19,004 7,699 146.8 57,945 45,989 26.0
Net income attributable to GAMCO per share $ 0.72 $ 0.29 148.3 % $ 2.19 $ 1.72 27.3 %
Shares outstanding at September 30             26,606         26,773                 26,606         26,773        
(a) After charge of $6,305 relating to extinguishment of debt.
 

Shareholders’ book value was $440.0 million or $16.54 per share at September 30, 2012. We ended the quarter with cash and investments of approximately $690.9 million and $216.1 million ($220.8 million face value) of debt.

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