SEI Reports First-Quarter 2011 Financial Results
OAKS, PA -- (MARKET WIRE) -- 04/27/11 -- SEI Investments Company (NASDAQ: SEIC) today announced financial results for first-quarter 2011. Diluted earnings per share were $.31 in first-quarter 2011 and first-quarter 2010. These results include gains from Structured Investment Vehicles (SIV) securities of $6.9 million or approximately $.02 diluted earnings per share in first quarter 2011 compared to $17.3 million or approximately $.05 diluted earnings per share in first-quarter 2010.
Consolidated Overview For the Three Months
(In thousands, except earnings per Ended March 31,
share) 2011 2010 %
----------- ----------- ---------
Revenues $ 232,493 $ 221,535 5%
Net Income attributable to SEI 57,728 59,420 (3%)
Diluted Earnings Per Share $ 0.31 $ 0.31 -
"Compared to a year ago, our first-quarter results reflect improved capital
markets and growing acceptance for all of our services," said Alfred P.
West, Jr., SEI Chairman and CEO. "First-quarter profits reflect increased
spending on both development and operational support for the Global Wealth
Platform as we increased development for U.S. entry and enhanced our U.K.
services. We are confident we are well-positioned for long-term growth in
both of these markets."
Summary of First-Quarter Results by Business Segment
(In thousands) For the Three Month Period
Ended March 31,
2011 2010 %
--------- --------- --------
Private Banks:
Revenues $ 86,709 $ 87,121 -
Expenses 82,403 77,599 6%
--------- ---------
Operating Profit $ 4,306 $ 9,522 (55%)
Operating Margin 5% 11%
Investment Advisors:
Revenues 48,108 45,463 6%
Expenses 27,040 27,583 (2%)
--------- ---------
Operating Profit 21,068 17,880 18%
Operating Margin 44% 39%
Institutional Investors:
Revenues 53,185 50,339 6%
Expenses 26,953 26,380 2%
--------- ---------
Operating Profit 26,232 23,959 9%
Operating Margin 49% 48%
Investment Managers:
Revenues 43,441 37,610 16%
Expenses 27,999 24,559 14%
--------- ---------
Operating Profit 15,442 13,051 18%
Operating Margin 36% 35%
Investments in New Businesses:
Revenues 1,050 1,002 5%
Expenses 3,125 2,661 17%
--------- ---------
Operating Loss (2,075) (1,659) N/A
Operating Margin N/A N/A
Totals:
Revenues $ 232,493 $ 221,535 5%
Expenses 167,520 158,782 6%
Corporate overhead expenses 10,648 9,717 10%
Noncontrolling interest reflected in
segments (272) (309) N/A
--------- ---------
Income from operations $ 54,597 $ 53,345 2%
First-Quarter Business Commentary:
-- Sales events, net of client losses, during first-quarter 2011 totaled
$13.8 million and are expected to generate net annualized recurring
revenues of approximately $12.5 million.
-- Asset management, administration, and distribution fee revenues
increased primarily due to higher asset balances under management and
administration from existing clients because of improved capital
markets.
-- Assets under management increased $6.9 billion to $179.2 billion at
March 31, 2011, as compared to $172.3 billion at December 31, 2010.
-- Total consolidated expenses in first-quarter 2011 reflect increased
spending on the Global Wealth Platform (GWP). During the first-quarter
2011, we incurred additional costs related to production and
maintenance to run the platform as well as additional costs associated
with the ongoing development of GWP. We estimate these additional
costs to be approximately $3.0 million above fourth-quarter 2010
levels.
-- Net income attributable to SEI and diluted earnings per share results
include gains from SIV securities of $6.9 million or approximately $.02
diluted earnings per share in first-quarter 2011 compared to $17.3
million or approximately $.05 diluted earnings per share in first-
quarter 2010. Excluding the gains from SIV securities, diluted
earnings per share were $.29 in first-quarter 2011 compared to $.26 in
first-quarter 2010.
-- In the first-quarter 2011, SEI purchased 1,725,000 shares of its common
stock for $39.5 million.
Earnings Conference Call
A conference call to review earnings is scheduled for 2:00 PM ET on April 27, 2011. Investors may listen to the call at www.seic.com/investors or listen at www.earnings.com, a service of Thomson Streetevents. The call may also be accessed at numerous financial services web sites including AOL and Yahoo. Investors may also listen to replays at these web sites, or by telephone at (USA) 1-800-475-6701; (International) 320-365-3844, access code 199003.
About SEI
SEI (NASDAQ: SEIC) is a leading global provider of investment processing, fund processing, and investment management business outsourcing solutions that help corporations, financial institutions, financial advisors, and ultra-high-net-worth families create and manage wealth. As of March 31, 2011, through its subsidiaries and partnerships in which the company has a significant interest, SEI manages or administers $429 billion in mutual fund and pooled assets or separately managed assets, including $179 billion in assets under management and $250 billion in client assets under administration. For more information, visit www.seic.com.
Many of the statements in this release may be considered "forward looking statements" and include discussions about future operations, strategies and financial results. Forward-looking statements are based upon estimates and assumptions that involve risks and uncertainties, many of which are beyond our control or are subject to change. Although we believe our assumptions are reasonable, they could be inaccurate. Our actual future revenues and income could differ materially from our expected results. We have no obligation to publicly update or revise any forward-looking statements.
SEI INVESTMENTS COMPANY
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
Three Months Ended
March 31,
----------------------
2011 2010
---------- ----------
Asset management, admin. and distribution fees $ 167,504 $ 152,938
Information processing and software servicing fees 55,824 58,626
Transaction-based and trade execution fees 9,165 9,971
---------- ----------
Total revenues 232,493 221,535
Subadvisory, distribution and other asset mgmt
costs 26,296 25,583
Software royalties and other information processing
costs 7,017 6,074
Brokerage commissions 6,581 7,425
Compensation, benefits and other personnel 71,025 67,216
Stock based compensation 3,732 6,657
Consulting, outsourcing and professional fees 25,998 20,707
Data processing and computer related 11,303 9,928
Facilities, supplies and other costs 14,102 13,494
Amortization 6,231 5,900
Depreciation 5,611 5,206
---------- ----------
Total expenses 177,896 168,190
Income from operations 54,597 53,345
Net gain on investments 7,278 17,479
Interest and dividend income 1,544 1,700
Interest expense (204) (471)
Equity in earnings of unconsolidated affiliate 28,949 24,074
---------- ----------
Income before taxes 92,164 96,127
Income taxes 34,124 36,269
---------- ----------
Net income 58,040 59,858
---------- ----------
Less: Net income attributable to noncontrolling
interest (312) (438)
---------- ----------
Net income attributable to SEI $ 57,728 $ 59,420
---------- ----------
Diluted earnings per common share $ 0.31 $ 0.31
---------- ----------
Shares used to calculate diluted
earnings per common share 188,495 191,062
---------- ----------
Basic earnings per common share $ 0.31 $ 0.31
---------- ----------
Shares used to calculate basic
earnings per common share 185,787 189,948
========== ==========
SEI INVESTMENTS COMPANY
CONDENSED BALANCE SHEETS
(In thousands)
(Unaudited)
March 31, December 31,
2011 2010
------------ ------------
Assets
Cash and short-term investments $ 498,039 $ 496,292
Restricted cash 4,000 4,000
Receivables, net 162,186 165,772
Securities owned 20,009 -
Other current assets 18,513 17,655
------------ ------------
Total current assets 702,747 683,719
Property and equipment, net 142,333 140,568
Marketable securities 148,384 179,364
Capitalized software, net 299,006 294,332
Investment in unconsolidated affiliate 69,237 64,409
Other assets, net 16,328 14,831
------------ ------------
Total assets $ 1,378,035 $ 1,377,223
============ ============
Liabilities
Current liabilities $ 125,066 $ 127,600
Long-term debt 60,000 95,000
Deferred income taxes 94,074 92,253
Long-term liabilities 5,939 5,645
Total SEI Investments Company shareholders'
equity 1,077,069 1,041,570
Noncontrolling interest 15,887 15,155
------------ ------------
Total Equity 1,092,956 1,056,725
Total liabilities and equity $ 1,378,035 $ 1,377,223
============ ============
SEI INVESTMENTS COMPANY
ASSET BALANCES
(In millions)
(Unaudited)
Mar. 31, Jun. 30, Sep. 30, Dec. 31, Mar. 31,
2010 2010 2010 2010 2011
--------- --------- --------- --------- ---------
Private Banks:
Equity/Fixed Income
prgms. $ 12,635 $ 11,769 $ 12,842 $ 13,512 $ 14,809
Collective Trust Fund
prgm. 1,023 640 615 626 576
Liquidity funds 5,329 5,175 5,034 5,120 5,217
--------- --------- --------- --------- ---------
Total assets under
mgmt. $ 18,987 $ 17,584 $ 18,491 $ 19,258 $ 20,602
Client assets under
admin. 11,429 10,335 10,557 10,672 11,227
--------- --------- --------- --------- ---------
Total assets $ 30,416 $ 27,919 $ 29,048 $ 29,930 $ 31,829
Investment Advisors:
Equity/Fixed Income
prgms. $ 26,222 $ 23,699 $ 26,091 $ 27,680 $ 28,296
Collective Trust Fund
prgm. 2,284 2,066 2,028 1,820 1,618
Liquidity funds 1,731 2,635 2,253 1,641 1,551
--------- --------- --------- --------- ---------
Total assets under
mgmt. $ 30,237 $ 28,400 $ 30,372 $ 31,141 $ 31,465
Institutional Investors:
Equity/Fixed Income
prgms. $ 45,891 $ 43,506 $ 47,667 $ 48,699 $ 51,287
Collective Trust Fund
prgm. 657 643 641 623 608
Liquidity funds 3,198 2,558 3,475 3,382 3,202
--------- --------- --------- --------- ---------
Total assets under
mgmt. $ 49,746 $ 46,707 $ 51,783 $ 52,704 $ 55,097
Investment Managers:
Equity/Fixed Income
prgms. $ 2 $ 1 $ 1 $ 1 $ 37
Collective Trust Fund
prgm. 7,639 7,366 7,781 8,177 8,841
Liquidity funds 447 428 423 313 139
--------- --------- --------- --------- ---------
Total assets under
mgmt. $ 8,088 $ 7,795 $ 8,205 $ 8,491 $ 9,017
Client assets under
admin. (A) 220,807 220,459 227,777 233,079 238,335
--------- --------- --------- --------- ---------
Total assets $ 228,895 $ 228,254 $ 235,982 $ 241,570 $ 247,352
Investments in New
Businesses:
Equity/Fixed Income
prgms. $ 534 $ 496 $ 533 $ 569 $ 598
Liquidity funds 72 74 82 65 56
--------- --------- --------- --------- ---------
Total assets under
mgmt. $ 606 $ 570 $ 615 $ 634 $ 654
LSV Asset Management
Equity/Fixed Income
prgms. $ 54,189 $ 47,822 $ 54,492 $ 60,058 $ 62,370
Consolidated:
Equity/Fixed Income
prgms (B) $ 139,473 $ 127,293 $ 141,626 $ 150,519 $ 157,397
Collective Trust Fund
prgm. 11,603 10,715 11,065 11,246 11,643
Liquidity funds 10,777 10,870 11,267 10,521 10,165
--------- --------- --------- --------- ---------
Total assets under
mgmt. $ 161,853 $ 148,878 $ 163,958 $ 172,286 $ 179,205
Client assets under
admin. (C) 232,236 230,794 238,334 243,751 249,562
--------- --------- --------- --------- ---------
Total assets $ 394,089 $ 379,672 $ 402,292 $ 416,037 $ 428,767
(A) Client assets under administration in the Investment Managers segment
include $54.0 billion of assets balances that require limited services
and therefore are at fee levels below our normal full service assets
(as of March 31, 2011).
(B) Equity/Fixed Income programs include $2.3 billion of assets invested in
various asset allocation funds at March 31, 2011.
(C) In addition to the numbers presented, SEI also administers an
additional $5.1 billion in Funds of Funds assets (as of March 31, 2011)
on which SEI does not earn an administration fee.
Investor Contact: Murray Louis SEI (610) 676-1932 mlouis@seic.com Media Contact: Dana Grosser SEI (610) 676-2459 dgrosser@seic.com
Source: SEI
Released April 27, 2011