Waddell & Reed Swings to Profit in Second Quarter

Mutual fund company Waddell & Reed(WDR Quote) swung to a profit in the second quarter, helped by an increase in assets under management.

The company reported net income of $29.7 million, or 36 cents per diluted share, in the three months ended June. That compares with a net loss of $33.0 million, or 40 cents per diluted share, in the second quarter last year.

The year-earlier figure includes two nonrecurring charges: a $39.4 million settlement with the Securities and Exchange Commission and state regulators, and a $20 million payment "to recognize the impairment of goodwill" with one of its subsidiaries, Austin Calvert & Flavin. Excluding the charges, Waddell's earnings for the second quarter of 2006 were $26.4 million, or 32 cents a diluted share.

The result matched the expectations of analysts surveyed by Thomson Financial. ...