EX-99.1 2 a05-2639_1ex99d1.htm EX-99.1

Exhibit 99.1

 

 

 

News Release

 

Waddell & Reed Financial, Inc. Reports Fourth Quarter Results

 

•                  Diluted earnings per share of $0.31 for the quarter; $1.25 for the year

•                  Financial advisors head count growth of 7% since June 30, 2004

•                  Investment product sales in Advisors channel improves 18% over the third quarter of 2004

•                  Sales per advisor improves 16% over the third quarter of 2004

•                  Non-proprietary sales reach highest level since inception; 52% higher than third quarter of 2004

•                  Relative investment performance, as measured by Lipper and MorningStar, continues to improve

 

Overland Park, KS, January 27, 2005 – Waddell & Reed Financial, Inc. (NYSE: WDR) reported fourth quarter net income of $25.7 million, or $0.31 per diluted share, compared to $23.4 million, or $0.29 per diluted share, in the third quarter of 2004 and net income of $28.1 million, or $0.34 per diluted share, in last year’s comparable period.  Full year 2004 net income was $102.2 million, or $1.25 per diluted share, compared to adjusted net income of $93.0 million, or $1.13 per diluted share, in 2003.  The results for 2003 were adjusted to exclude an after-tax charge of $17.2 million ($0.21 per diluted share) taken as a result of our stock option tender offer and an after-tax charge of $21.5 million ($0.26 per diluted share) to recognize liabilities associated with certain legal and regulatory matters.  We believe adjusting last year’s results for these special charges provides shareholders with a more accurate comparison to this year’s results.  A schedule reconciling these adjusted results from GAAP is provided on pages 5 and 6.  GAAP net income for the twelve months ended December 31, 2003 was $54.3 million, or $0.66 per diluted share.

 

“We finished the year in each retail distribution channel on a strong note,” said Keith A. Tucker, Chairman and Chief Executive Officer of Waddell & Reed Financial, Inc.  “After two quarters of disappointing results in our Advisors channel, fourth quarter sales and advisor productivity showed marked improvement over the second and third quarters of 2004.  Separately, gross sales in our non-proprietary distribution channel continued to accelerate and, at $1.4 billion for the year, comfortably exceeded the $1.0 billion threshold.”

 

Channel Discussion

 

Waddell & Reed Advisors channel

 

Our wholesaling efforts have been well received by our financial advisors.  During the fourth quarter we noted significant improvement in sales and productivity over the second and third quarters of this year.   Retail investment product sales improved 5% and 18% compared to the second and third quarters, respectively, while productivity per advisor improved by 1% and 16% over the same time periods.

 

1


 

While advisor headcount increased during the quarter, the amount of the increase was subdued somewhat by lower than anticipated licensing of new advisors.  However, the pipeline for headcount growth in 2005 is strong with the number of licensing kits in process at year-end up 49% from a year ago.  In addition, through January 25, the number of terminations has decreased compared to last year, and we expect this trend to continue throughout the first quarter. We anticipate an annual growth in headcount of 10% in 2005.

 

Wholesale channel

 

Demand for our mutual funds in our non-proprietary channel continues to accelerate.  Gross and net sales during the quarter were at record levels.  Gross sales during the quarter were $460 million, and represent a compound annual growth rate of 67% since the re-launch of our non-proprietary sales efforts in July of 2003.  Net sales for the quarter also set record levels at $178 million, a compound annual growth rate of over 100% during the same period.  For the year ended December 31, 2004, our non-proprietary efforts yielded an organic growth rate of 9.5%.

 

Management Fee Revenues

 

Compared to third quarter of 2004, as well as to the fourth quarter of 2003, fourth quarter 2004 revenues increased in close correlation to the increase in average assets under management.  We continue to experience an improvement in the overall management fee rate due to a mix shift between the Advisors, Ivy and W&R Target Funds that occurred when we acquired and merged the Securian assets into the Ivy and W&R Target Funds in the second half of 2003.  The Ivy and W&R Target Funds generally have a slightly higher management fee rate due to scale.  For the quarters ended December 2004, September 2004 and December 2003, the overall management fee rate was 66.9 basis points, 66.1 basis points and 65.5 basis points, respectively.

 

Investment Product Sales (1)

Advisors Channel

($ thousands)

 

 

 

4Q 04

 

4Q 03

 

%

 

3Q 04

 

%

 

Front-load sales

 

$

391,438

 

$

434,740

 

-10.0

%

$

336,996

 

16.2

%

Deferred-load sales

 

60,215

 

71,919

 

-16.3

%

51,150

 

17.7

%

Allocation Product Sales (no-load) (2)

 

7,097

 

—

 

nm

 

—

 

nm

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

$

458,750

 

$

506,659

 

- 9.5

%

$

388,146

 

18.2

%

 

(1) Investment product sales exclude sales at net asset value, Class Y sales, and sales of money market funds.  Sales load is included.

(2) Includes Strategic Portfolio Allocation (“SPA”) and Model Allocation Portfolio (“MAP”) products.

 

Underwriting and Distribution Revenues

 

In the current quarter, our Advisors channel generated approximately three-quarters of revenues while the Wholesale channel earned the remainder.

 

On a sequential quarter basis, two-thirds of the increase in revenues is attributable to the Advisors channel through a combination of improved sales volume and higher financial planning fees.  The remainder of the improvement is attributable to the Wholesale channel, primarily due to an improvement in sales volume by Legend advisors.

 

2


 

Comparing the current quarter to last year’s fourth quarter, revenues in the Advisors channel declined as the improvement in financial planning fees was offset by weaker front-load sales volume and lower asset allocation fees.  The net decline in revenues recorded in the Advisors channel was offset by an increase in revenues in the Wholesale channel due to higher sales volume by Legend advisors.

 

Underwriting and Distribution Expenses

 

In the current quarter, our Advisors channel is responsible for approximately 70% of variable and fixed expenses, while the Wholesale channel is responsible for the remainder.

 

On a sequential quarter basis, the overall increase in expenses is due in equal parts to the Advisors channel and the Wholesale channel.  In the Advisors channel, the increase in expense is due primarily to higher sales volume and higher financial plan activity.  Fixed expenses in the Advisors channel remain practically unchanged.  In the Wholesale channel, the increase in expenses is due to a combination of higher sales volume by Legend advisors, and higher sales volume in our non-proprietary distribution efforts.  Fixed expenses also increased in the Wholesale channel due to higher costs associated with our wholesaling activities, advertising and sales brochures.

 

Compared to last year’s fourth quarter, the overall increase in expenses is due almost entirely to higher expenses in the Wholesale channel.  Higher sales volume by Legend advisors and our non-proprietary distribution efforts accounted for approximately half of the increase in total expenses.  Fixed expenses accounted for the remainder of the increase; specifically, increases in this channel were due to higher costs associated with our wholesaling activities, advertising and sales brochures.

 

The Waddell & Reed Advisors underwriting and distribution margin, a measure that excludes our wholesale underwriting and distribution activities, improved to –1.6% during the quarter, from –2.9% in this year’s third quarter as sales levels in the Advisors channel increased; however, it declined compared to –0.5% in last year’s 4th quarter due to lower sales levels.

 

Shareholder Service Fee Revenues

 

Comparing the current quarter to last year’s comparable period, the increase in revenues is due primarily to the addition of the Securian accounts in December 2003 and the addition of funds to our asset allocation product; to a lesser degree, the growth in number of accounts contributed.

 

Other Operating Items

 

Compensation and related costs increased when compared to the third quarter due to increased earnings related to deferred compensation plans, headcount increases and year-end adjustments in incentive compensation.  Compared to last year’s fourth quarter, expenses increased due to higher incentive compensation and headcount growth.

 

Equity compensation increased compared to last year’s comparable period due to additional restricted stock grants in the current year.

 

General and administrative expenses declined compared to this year’s third quarter due to somewhat lower legal expenses.  This decline was partially offset by higher compliance costs associated with the Sarbanes-Oxley Act.  Compared to last year’s fourth quarter, the increase is due to compliance costs associated with the Sarbanes-Oxley Act.

 

3


 

In 2003, we began paying sub-advisory fees for certain Securian assets sub-advised by other asset managers.  These assets were acquired in September and December 2003 and are reflected in subsequent periods.   The sequential quarterly increase is primarily due to strong sales and asset growth in some of our sub-advised funds.

 

Other Income (Expense)

 

Other income increased compared to this year’s third quarter primarily due to increased appreciation on trading securities related to our deferred compensation plans and increased dividends earned on mutual fund holdings during the period.  Compared to the same quarter last year, the decline is due to a gain recorded in the prior year from the sale of a mutual fund investment partially offset in part by current year gains from trading securities.

 

Interest expense increased compared to this year’s third quarter due to higher variable interest paid on long-term debt and higher average borrowings and rates on short-term debt during the period.  Compared to last year’s comparable period, the increase is also attributed to higher variable rates paid on long-term debt coupled with higher average balances and rates for short-term borrowings during the period.

 

Tax Rate

 

The effective tax rate for the quarter was 33.6% compared to 36.3% and 36.2% for the third quarter of 2004 and the fourth quarter of 2003, respectively.  The decline in the effective tax rate is due to an evaluation of various federal and state income tax matters.

 

Balance Sheet Information

As of December 31, 2004

 

•                  Cash balance of $83.9 million ($22.6 million held for the exclusive benefit of customers in compliance with federal securities industry regulations.)

•                  Investment securities of $125.3 million.

•                  Cash and investment securities of $99.4 million are restricted or pledged as collateral pending the outcome of legal matters.

•                  Long-term debt outstanding of $202.9 million.

•                  Short-term debt outstanding of $35.0 million.

•                  Shareholders’ equity of $218.9 million.

•                  Shares outstanding were 82.8 million.

 

Schedule of Selected Operating Data

 

Included in the following Schedules of Selected Operating Data is a representation of cash earnings and cash operating margin.

 

We believe adjusting our results by excluding non-cash items such as equity compensation and non-recurring items promotes comparability to the operating results of other companies who may use options and have elected not to expense their cost.  A reconciliation from GAAP is provided at the bottom of the schedule.

 

4


 

WADDELL & REED FINANCIAL, INC.

Schedule of Selected Operating Data

(Amounts in thousands except for per share data)

 

 

 

Three Months Ended
December 31,

 

Change

 

Three Months Ended
September 30,

 

Change

 

 

 

2004

 

2003

 

$

 

%

 

2004

 

$

 

%

 

Operating Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment management fees

 

$

62,504

 

$

57,594

 

4,910

 

8.5

 

$

58,221

 

4,283

 

7.4

 

Underwriting & distribution fees

 

48,475

 

47,896

 

579

 

1.2

 

43,292

 

5,183

 

12.0

 

Shareholder service fees

 

19,333

 

18,574

 

759

 

4.1

 

19,121

 

212

 

1.1

 

Total operating revenues

 

130,312

 

124,064

 

6,248

 

5.0

 

120,634

 

9,678

 

8.0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Underwriting and distribution:

 

53,549

 

49,170

 

4,379

 

8.9

 

47,833

 

5,716

 

11.9

 

Compensation and related costs

 

19,577

 

18,395

 

1,182

 

6.4

 

16,911

 

2,666

 

15.8

 

Equity Compensation

 

2,872

 

1,108

 

1,764

 

159.2

 

2,828

 

44

 

1.6

 

General and administrative

 

9,399

 

8,676

 

723

 

8.3

 

9,937

 

(538

)

-5.4

 

Sub-advisory

 

2,774

 

699

 

2,075

 

296.9

 

1,726

 

1,048

 

60.7

 

Depreciation

 

2,313

 

2,035

 

278

 

13.7

 

2,300

 

13

 

0.6

 

Total operating expense

 

90,484

 

80,083

 

10,401

 

13.0

 

81,535

 

8,949

 

11.0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other Income (Expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment & other income

 

2,037

 

2,383

 

(346

)

-14.5

 

439

 

1,598

 

364.0

 

Interest expense

 

(3,230

)

(2,419

)

(811

)

-33.5

 

(2,769

)

(461

)

-16.6

 

Income before taxes

 

38,635

 

43,945

 

(5,310

)

-12.1

 

36,769

 

1,866

 

5.1

 

Provision for taxes

 

12,974

 

15,887

 

(2,913

)

-18.3

 

13,351

 

(377

)

-2.8

 

Net income

 

$

25,661

 

$

28,058

 

(2,397

)

-8.5

 

$

23,418

 

2,243

 

9.6

 

Cash earnings (1)

 

$

27,490

 

$

28,765

 

(1,274

)

-4.4

 

$

25,219

 

2,271

 

9.0

 

Net income per share - diluted

 

$

0.31

 

$

0.34

 

 

 

-8.8

 

$

0.29

 

 

 

6.9

 

Cash earnings per share - diluted (1)

 

$

0.33

 

$

0.35

 

 

 

-5.7

 

$

0.31

 

 

 

6.5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average number  of shares outstanding - diluted

 

82,090

 

82,707

 

 

 

 

 

81,634

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash operating margin (1)

 

32.8

%

36.3

%

 

 

 

 

34.8

%

 

 

 

 

Waddell & Reed Advisors U&D margin (2)

 

-1.6

%

-0.5

%

 

 

 

 

-2.9

%

 

 

 

 

 

(1)                     Reconciliation from GAAP provided below

(2)                     Excludes our wholesale underwriting and distribution activities

 

GAAP net income

 

$

25,661

 

$

28,058

 

 

 

 

 

$

 23,418

 

 

 

 

 

Add back equity compensation (post-tax)

 

1,829

 

707

 

 

 

 

 

1,801

 

 

 

 

 

Cash earnings

 

$

27,490

 

$

28,765

 

 

 

 

 

$

 25,219

 

 

 

 

 

GAAP net income per share (diluted)

 

$

0.31

 

$

0.34

 

 

 

 

 

$

 0.29

 

 

 

 

 

Add back equity compensation (post-tax)

 

0.02

 

0.01

 

 

 

 

 

0.02

 

 

 

 

 

Cash earnings per share (diluted) *

 

$

0.33

 

$

0.35

 

 

 

 

 

$

 0.31

 

 

 

 

 

GAAP operating margin

 

30.6

%

35.5

%

 

 

 

 

32.4

%

 

 

 

 

Add back equity compensation

 

2.2

%

0.9

%

 

 

 

 

2.3

%

 

 

 

 

Cash operating margin *

 

32.8

%

36.3

%

 

 

 

 

34.8

%

 

 

 

 

 

*                    Column may not add due to rounding

 

5


 

WADDELL & REED FINANCIAL, INC.

Schedule of Selected Operating Data

(Amounts in thousands except for per share data)

 

 

 

Year Ended December 31,

 

Change

 

 

 

2004

 

2003

 

$

 

%

 

Operating Revenues:

 

 

 

 

 

 

 

 

 

Investment management fees

 

$

240,282

 

$

203,918

 

36,364

 

17.8

 

Underwriting & distribution fees

 

187,273

 

176,586

 

10,687

 

6.1

 

Shareholder service fees

 

76,522

 

70,678

 

5,844

 

8.3

 

Total operating revenues

 

504,077

 

451,182

 

52,895

 

11.7

 

 

 

 

 

 

 

 

 

 

 

Operating Expenses:

 

 

 

 

 

 

 

 

 

Underwriting and distribution:

 

203,189

 

184,223

 

18,966

 

10.3

 

Compensation and related costs

 

72,763

 

68,515

 

4,248

 

6.2

 

Equity Compensation

 

 

 

 

 

 

 

 

 

Excluding special charge

 

10,336

 

4,569

 

5,767

 

126.2

 

Special charge (1)

 

—

 

27,113

 

(27,113

)

N/A

 

General and administrative

 

 

 

 

 

 

 

 

 

Excluding special charge

 

38,357

 

37,862

 

495

 

1.3

 

Special charge (2)

 

—

 

32,000

 

(32,000

)

N/A

 

Sub-advisory

 

6,983

 

1,012

 

5,971

 

590.0

 

Depreciation

 

9,090

 

7,191

 

1,899

 

26.4

 

Total operating expense

 

340,718

 

362,485

 

(21,767

)

-6.0

 

 

 

 

 

 

 

 

 

 

 

Other Income (Expense):

 

 

 

 

 

 

 

 

 

Investment & other income

 

5,575

 

5,996

 

(421

)

-7.0

 

Interest expense

 

(10,724

)

(9,759

)

(965

)

-9.9

 

Income before taxes

 

158,210

 

84,934

 

73,276

 

86.3

 

Provision for taxes

 

56,045

 

30,669

 

25,376

 

82.7

 

Net income

 

$

102,165

 

$

54,265

 

47,900

 

88.3

 

Cash earnings (3)

 

$

108,749

 

$

95,880

 

12,869

 

13.4

 

Net income per share - diluted

 

$

1.25

 

$

0.66

 

 

 

89.4

 

Cash earnings per share - diluted (3)

 

$

1.33

 

$

1.16

 

 

 

14.7

 

Weighted avg. number of shares outstanding - diluted

 

81,924

 

82,590

 

 

 

 

 

Cash operating margin (3)

 

34.5

%

33.8

%

 

 

 

 

Waddell & Reed Advisors U&D margin (4)

 

-0.1

%

-1.9

%

 

 

 

 

 

(1)             Special charge for tender

(2)             Special charge for legal and regulatory matters

(3)             Reconciliation from GAAP provided below

(4)             Excludes our wholesale underwriting and distribution activities

 

GAAP net income

 

$

102,165

 

$

54,265

 

 

 

 

 

Add back special charge for tender (post-tax)

 

—

 

17,200

 

 

 

 

 

Add back special charge for legal & regulatory matters (post-tax)

 

—

 

21,500

 

 

 

 

 

Add back equity compensation (post-tax)

 

6,584

 

2,915

 

 

 

 

 

Cash earnings

 

$

108,749

 

$

95,880

 

 

 

 

 

GAAP net income per share (diluted)

 

$

1.25

 

$

0.66

 

 

 

 

 

Add back special charge for tender (post-tax)

 

0.00

 

0.21

 

 

 

 

 

Add back special charge for legal & regulatory matters (post-tax)

 

0.00

 

0.26

 

 

 

 

 

Add back equity compensation (post-tax)

 

0.08

 

0.04

 

 

 

 

 

Cash earnings per share (diluted) *

 

$

1.33

 

$

1.16

 

 

 

 

 

GAAP operating margin

 

32.4

%

19.7

%

 

 

 

 

Add back special charge for tender (post-tax)

 

0.0

%

6.0

%

 

 

 

 

Add back special charge for legal & regulatory matters (post-tax)

 

0.0

%

7.1

%

 

 

 

 

Add back equity compensation (post-tax)

 

2.1

%

1.0

%

 

 

 

 

Cash operating margin *

 

34.5

%

33.8

%

 

 

 

 

 

*             Column may not add due to rounding

 

6


 

WADDELL & REED FINANCIAL, INC.

Changes in Assets Under Management

For the quarter ended

(Amounts in millions)

 

 

 

Waddell & Reed
Advisors Channel

 

Wholesale Channel

 

Total

 

December 31, 2004

 

 

 

 

 

 

 

Beginning Assets

 

$

23,484

 

$

12,119

 

$

35,603

 

Sales

 

555

 

735

 

1,290

 

Redemptions

 

(813

)

(654

)

(1,467

)

Net Sales

 

(258

)

81

 

(177

)

Net Exchanges and Adjustments

 

(15

)

12

 

(3

)

Reinvested Dividends and Capital Gains

 

75

 

56

 

131

 

Net Flows

 

(198

)

149

 

(49

)

Market Appreciation

 

2,011

 

1,093

 

3,104

 

Ending Assets

 

$

25,297

 

$

13,361

 

$

38,658

 

 

 

 

 

 

 

 

 

December 31, 2003

 

 

 

 

 

 

 

Beginning Assets

 

$

22,549

 

$

10,327

 

$

32,876

 

Securian Assets (1)

 

—

 

481

 

481

 

Sales

 

604

 

890

 

1,494

 

Redemptions

 

(866

)

(496

)

(1,362

)

Net Sales

 

(262

)

394

 

132

 

Net Exchanges and Adjustments

 

(23

)

19

 

(4

)

Reinvested Dividends and Capital Gains

 

39

 

32

 

71

 

Net Flows

 

(246

)

445

 

199

 

Market Appreciation

 

2,034

 

983

 

3,017

 

Ending Assets

 

$

24,337

 

$

12,236

 

$

36,573

 

 

 

 

 

 

 

 

 

September 30, 2004

 

 

 

 

 

 

 

Beginning Assets

 

$

24,173

 

$

12,185

 

$

36,358

 

Sales

 

495

 

813

 

1,308

 

Redemptions

 

(834

)

(628

)

(1,462

)

Net Sales

 

(339

)

185

 

(154

)

Net Exchanges and Adjustments

 

(16

)

13

 

(3

)

Reinvested Dividends and Capital Gains

 

31

 

32

 

63

 

Net Flows

 

(324

)

230

 

(94

)

Market Appreciation/(Depreciation)

 

(365

)

(296

)

(661

)

Ending Assets

 

$

23,484

 

$

12,119

 

$

35,603

 

 

(1)                   Assets acquired in connection with the strategic alliance with Securian Financial Group, Inc.     

 

7


 

WADDELL & REED FINANCIAL, INC.

Supplemental Information

 

Other Items

 

 

 

4Q04

 

4Q03

 

% change

 

3Q04

 

% change

 

Redemption rates - long-term assets

 

 

 

 

 

 

 

 

 

 

 

Waddell & Reed Advisors channel

 

10.9

%

11.0

%

 

 

11.6

%

 

 

Wholesale channel

 

20.0

%

17.2

%

 

 

21.1

%

 

 

Total

 

14.1

%

13.0

%

 

 

14.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales per advisor (000s) (1)

 

 

 

 

 

 

 

 

 

 

 

Total

 

178

 

173

 

2.9

%

154

 

15.6

%

2+ Years

 

264

 

247

 

6.9

%

222

 

18.9

%

0 to 2 Years

 

45

 

57

 

-21.1

%

42

 

7.1

%

 

 

 

 

 

 

 

 

 

 

 

 

Gross production per advisor (000s) (2)

 

13.2

 

12.2

 

8.2

%

12.3

 

7.3

%

 

 

 

 

 

 

 

 

 

 

 

 

Number of advisors (3)

 

2,623

 

2,929

 

-10.5

%

2,566

 

2.2

%

 

 

 

 

 

 

 

 

 

 

 

 

Number of shareholder accounts (000s)

 

2,423

 

2,339

 

3.6

%

2,387

 

1.5

%

 

(1)             Average commissionable sales per Waddell & Reed Advisor

 

(2)             Average gross commission generated per Waddell & Reed Advisor

 

(3)             Excludes Legend retirement advisors

 

Lipper Ranking

 

 

 

1 Year

 

3 Years

 

5 Years

 

Percentage of funds

 

 

 

 

 

 

 

Equity Funds

 

 

 

 

 

 

 

Top Quartile

 

36

%

48

%

54

%

Top Half

 

64

%

74

%

71

%

 

 

 

 

 

 

 

 

All Funds

 

 

 

 

 

 

 

Top Quartile

 

29

%

38

%

43

%

Top Half

 

59

%

64

%

65

%

 

MorningStar Ranking

 

 

 

Overall

 

3 Years

 

5 Years

 

Percentage of funds with 4 or 5 stars

 

 

 

 

 

 

 

Equity Funds

 

43

%

40

%

46

%

All Funds

 

34

%

32

%

35

%

 

8


 

Earnings Conference Call

 

Members of the investment community and the general public are invited to listen to a live webcast of our earnings release conference call today, January 27, 2005 at 11:00 a.m. Eastern.  During this call, Keith A. Tucker, Chairman and CEO, will review our fourth quarter results.  Live access to the teleconference will be available on the “Corporate” section of our website at www.waddell.com.  A webcast replay will be made available shortly after the call through February 2nd.

 

Website Resources

 

We invite you to visit the “Corporate” section of our website at www.waddell.com under the caption “Data Tables” to review supplemental information schedules on asset flows and average assets under management & management fee rates.

 

Contacts

 

Investor Contact:

Nicole McIntosh, Investor Relations Manager, (913) 236-1880, nmcintosh@waddell.com

 

Mutual Fund Investor Contact:

Call (888) WADDELL, or visit www.waddell.com or www.ivyfunds.com.

Past performance is no guarantee of future results.  Please invest carefully.

 

Forward-looking Statements

The statements in this press release relating to matters that are not historical facts are forward-looking statements based on management’s belief and assumptions using currently available information and expectations as of the date hereof, are not guarantees of future performance and involve certain risks, uncertainties and assumptions that are difficult to predict.  Although we believe that the expectations reflected in such forward-looking statements are reasonable, we cannot give any assurances that these expectations will prove to be correct.  Therefore, actual outcomes and results could materially differ from what is expressed, implied or forecast in such statements.  Such differences could be caused by a number of factors including, but not limited to, a risk that the expected benefits from the expansion of our distribution channels may not be as beneficial as anticipated, unexpected and adverse results of litigation or regulation, acts of terrorism and/or war, less favorable economic and market conditions including our cost to finance the Company, the risk that the intended results of our changes to long-term incentive compensation may not meet our expectations, and other risks as set out in the reports we have filed with the SEC.  Should one or more of these risks materialize or should the underlying assumptions prove incorrect, actual results could differ materially from those forecasted or expected.  We assume no duty to publicly update or revise such statements, whether as a result of new information, future events or otherwise.

 

9