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T. Rowe Price Meets Second-Quarter Views

Revenues climb as assets under management reach record $379.8 billion.
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T. Rowe Price's

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second-quarter earnings climbed 19% as growth in assets under management boosted investment advisory fees.

The Baltimore money manager earned $162 million, or 58 cents a share, up from $136 million, or 49 cents a share, a year ago.

Revenue totaled $551 million, up from $446 million a year ago. Investment advisory revenues climbed more than 25%, or $94 million, from a year ago, to $464.1 million. Administrative fees increased $10.7 million to $86.7 million.

The results were in line with expectations of analysts polled by Thomson Financial for earnings of 58 cents a share on $543.5 million in revenue.

Assets under management reached a record $379.8 billion at the end of the quarter, up $86.1 billion, or 29%, from $293.7 billion a year earlier.

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Assets were up 8.5% from the end of March. Investors added a net $7.9 billion to the firm's investment products during the quarter, while market appreciation and income contributed another $22 billion to the increase.

Assets in mutual funds, which are T. Rowe Price's largest business, rose $18.5 billion during the quarter to finish the period at $237.3 billion. The bulk of the increase, or $14.0 billion, was due to market appreciation, primarily in the firm's equity funds. Investors also added a net $4.5 billion, with a single product, the

(PRGFX) - Get T. Rowe Price Growth Stock Fd Report

Growth Stock Fund (PRGFX), pulling in $1.3 billion alone.

Investment advisor revenues on mutual funds distributed in the U.S. increased to $336 million for the quarter, up almost $66 million from a year earlier.

"Our strong second-quarter performance was achieved during a period in which global equity markets produced strong gains while bond returns were mostly negative," CEO and President James A.C. Kennedy said in a statement. "Shares were boosted by better-than-expected first-quarter earnings, especially among multinational firms, signs of sustained global economic growth, and substantial merger and acquisition activity."

Kennedy said T. Rowe Price used available cash to repurchase nearly $1.6 million shares during the second quarter. It has repurchased 2.4 million for the year to date through the first week of July, and remains debt-free with cash and corporate investment holdings of nearly $1.7 billion as of June 30.

Shares were up over 1% in early trading, but had given up some of that ground by midday, trading up 34 cents, or 0.66%, at $51.76.