May 5, 2010

Profits at Calamos, AllianceBernstein Surge in Q1

Calamos gets boost from rise in AUM; AllianceBernstein benefits from market resurgence and cost-cutting

Calamos and AllianceBernstein released their first-quarter earnings, with both showing significant growth in profit.

Calamos Asset Management posted a profit on Tuesday, May 4, above analysts' expectations, helped by a 40% rise in assets under management (AUM). First-quarter profits attributable to common shareholders were $4.8 million, or 24 cents a share, compared with a profit of $3.4 million, or 17 cents a share, in the year-ago period.

Analysts had expected the company to post earnings of 21 cents a share, according to Thomson Reuters. Revenue for the quarter was up 36% at $81.1 million.

AUM, a key driver of revenue and profit, were $32.3 billion, compared with $23.1 billion, in the same period last year.

"While last year's massive fiscal and economic stimulus appears to have restored investor confidence and stabilized the global economy," said John Calamos, Sr., Calamos' chairman and CEO, "investors have been slow to return to the domestic equity markets. Despite these headwinds, our global defensive equity and alternative strategies continued to see increasing demand and helped sustain our asset growth throughout the first quarter."

Calamos said that net redemptions during the quarter were primarily attributable to net outflows from its managed accounts, which were partially offset by approximately $250 million of net inflows into its institutional separate accounts. Calamos said that the net outflows for the quarter occurred because the firm increased the account minimums for its convertible-based strategies on separately-managed account (SMA) platforms.

AllianceBernstein Holding, which released results after the market closed on Monday, May 3, said its first-quarter profit rose 400% to $148 million, up from $37 million for the same period in 2009, due to the market turnaround and cost-cutting.

AUM rose 1.2% during the quarter, to $501.3 billion, despite $6.4 billion in net outflows. The outflows are sharply lower than in the prior-year period. Markets have since recovered, and AllianceBernstein has shed 10% of its jobs since then, reducing its costs.

For owners of units in publicly traded AllianceBernstein Holding LP, the results worked out to 46 cents per unit, up from 7 cents per unit a year earlier.

Revenue for the operating company was $725 million, compared with $598 million a year earlier. The company cited higher sales in its retail and private client sales channels.

The operating partnership, which manages the assets on behalf of clients, posted a quarterly profit of $131.5 million, up from $31.5 million a year earlier.

Read the full versions of the earnings report from Calamos and AllianceBernstein.

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