Affiliated Managers Group's (AMG) second-quarter earnings rose 9%, helped by the strong performance of its alternative investment and international equity products.Net income for the quarter rose 24% to $41.9 million from $33.9 million a year earlier. Cash net income, which the company defines as net income plus amortization and deferred taxes related to intangible assets, plus affiliate depreciation, rose to $60.3 million from $50.3 million a year earlier. Cash earnings per share, which are cash net income divided by the adjusted diluted average shares, increased to $1.52 per share from $1.30 per share. The results exceeded cash earnings expectations of $1.49 per share, according to analysts polled by Thomson Financial. Revenue increased to $331.5 million in the second quarter from $283.1 million a year earlier. AMG finished the quarter with $267 billion in assets under management, an increase of $18 billion, or 7%, over the first quarter and $64 billion, or 32%, over the year-earlier period. The company said affiliates that offer alternative investments, including AQR, First Quadrant, Third Avenue and Genesis, racked up some of the strongest performances. These kinds of products are particularly lucrative because they charge both management fees and performance fees. Affiliates specializing in international equities also did particularly well.
New money from investors accounted for $578 million of the increase during the quarter. Institutional investors added a net $245 million, while mutual fund clients contributed $488 million, but this was partially offset as wealthy individuals pulled a net $155 million. President and CEO Sean M. Healey said AMG is looking at making additional acquisitions. "Going forward we are confident that we will continue to enhance our earnings growth through investments in both traditional and alternative firms," he said. Elsewhere, SEI Investments Company ( SEIC) reported a 20% increase in income driven by increases in assets under management across all of its divisions. Net income rose to $69.5 million, or 34 cents a share, from $57.9 million, or 29 cents a share, for the same period of 2006. The results exceeded expectations of analysts polled by Thomson for EPS of 32 cents. Total assets under management exceeded $198.7 billion on June 30, up from $161.7 billion a year earlier. Assets increased for all of its segments, including private banks, investment advisers, institutional investors and investment managers.