0001056288-14-000013.txt : 20140724 0001056288-14-000013.hdr.sgml : 20140724 20140724172949 ACCESSION NUMBER: 0001056288-14-000013 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20140724 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20140724 DATE AS OF CHANGE: 20140724 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FEDERATED INVESTORS INC /PA/ CENTRAL INDEX KEY: 0001056288 STANDARD INDUSTRIAL CLASSIFICATION: INVESTMENT ADVICE [6282] IRS NUMBER: 251111467 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-14818 FILM NUMBER: 14992140 BUSINESS ADDRESS: STREET 1: FEDERATED INVESTORS TOWER STREET 2: 5800 CORPORATE DR CITY: PITTSBURGH STATE: PA ZIP: 15222 BUSINESS PHONE: 4122888141 MAIL ADDRESS: STREET 1: 1001 LIBERTY AVENUE CITY: PITTSBURGH STATE: PA ZIP: 15222 8-K 1 a8-kx2014q2epr.htm 8-K 8-K - 2014 Q2 EPR


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Form 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): July 24, 2014


FEDERATED INVESTORS, INC.
(Exact name of registrant as specified in its charter)
Pennsylvania
 
  001-14818
 
25-1111467
  (State or other jurisdiction
 
(Commission File Number)
 
(I.R.S. Employer
of incorporation)
 
 
 
Identification No.)

Federated Investors Tower
Pittsburgh, Pennsylvania 15222-3779
(Address of principal executive offices, including zip code)


(412) 288-1900
(Registrant's telephone number, including area code)


Not Applicable
(Former name or former address, if changed since last report)


Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))







ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION.

On July 24, 2014, Federated Investors, Inc. issued the earnings press release attached hereto as Exhibit 99.1 to report second quarter 2014 results.
    


ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.


(d) Exhibits:

Exhibit 99.1 - Earnings press release issued by Federated Investors, Inc. dated July 24, 2014










SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
                                    

 
 
 
FEDERATED INVESTORS, INC.
 
 
 
 
(REGISTRANT)
 
 
 
 
 
 
 
 
 
 
 
Date
July 24, 2014
By:
/s/ Thomas R. Donahue
 
 
 
 
Thomas R. Donahue
 
 
 
 
Chief Financial Officer
 





 EX-99.1 2 a991-2014q2earningspressre.htm PRESS RELEASE 99.1 - 2014 Q2 Earnings Press Release

Exhibit 99.1


Federated Investors, Inc. Reports Second Quarter 2014 Earnings; Equity Managed Assets Reach a Record $50 Billion
•
Net equity sales top $1.5 billion for Q2 2014
•
Equity and bond assets surpass $106 billion at June 30, 2014
•
Board declares $0.25 per share quarterly dividend
(PITTSBURGH, Pa., July 24, 2014) — Federated Investors, Inc. (NYSE: FII), one of the nation's largest investment managers, today reported earnings per diluted share (EPS) of $0.35 for Q2 2014 compared to $0.39 for the same quarter last year on net income of $36.9 million for Q2 2014 compared to $40.4 million for Q2 2013. Federated reported YTD 2014 EPS of $0.69 compared to $0.80 for the same period in 2013 and YTD 2014 net income of $72.1 million compared to $83.4 million for the same period last year.
Federated's total managed assets were $351.6 billion at June 30, 2014. Total assets were down $12.2 billion or 3 percent from $363.8 billion at June 30, 2013 and down $14.6 billion or 4 percent from $366.2 billion reported at March 31, 2014. Federated’s stock and bond assets were up $11.1 billion to $106.4 billion or 12 percent from $95.3 billion at June 30, 2013 and up $3.8 billion or 4 percent from $102.6 billion at March 31, 2014. Average managed assets for Q2 2014 were $358.4 billion, down $14.5 billion or 4 percent from $372.9 billion reported for Q2 2013 and down $16.0 billion or 4 percent from $374.4 billion reported for Q1 2014.
"Federated's increase in gross and net equity sales during the quarter strongly correlated with performance, with 96 percent  of Federated's equity-fund assets outperforming the majority of their peers over the last year and nearly 70 percent outperforming over the last three years," said J. Christopher Donahue, president and chief executive officer.  "Overall, the company’s continued success cut across a variety of investment strategies including balanced, dividend income, large growth and international core on the equity side and, on the bond side, our high-yield offerings."
Federated's board of directors declared a quarterly dividend of $0.25 per share. The dividend is payable on Aug. 15, 2014 to shareholders of record as of Aug. 8, 2014. During Q2 2014, Federated purchased 213,767 shares of Federated class B common stock for $5.9 million.  
Federated's equity assets were a record $49.9 billion at June 30, 2014, up $11.2 billion or 29 percent from $38.7 billion at June 30, 2013 and up $4.0 billion or 9 percent from $45.9 billion at March 31, 2014. Top-selling equity funds during Q2 2014 on a net basis were Federated Capital Income Fund, Federated Strategic Value Dividend Fund, Federated International Leaders Fund, Federated MDT Stock Trust and Federated Muni and Stock Advantage Fund.
Federated's fixed-income assets were $51.1 billion at June 30, 2014, up $1.1 billion or 2 percent from $50.0 billion at June 30, 2013 and up $0.1 billion from $51.0 billion at March 31, 2014. Bond assets in the liquidation portfolio were $5.4 billion at June 30, 2014. Top-selling fixed-income funds during Q2 2014 on a net basis were Federated Sterling Cash-Plus Fund, Federated Institutional High Yield Bond Fund, Federated Floating Rate Strategic Income Fund, Federated High Yield Trust, Federated Ultrashort Bond Fund and Federated Intermediate Corporate Bond Fund.

MEDIA:
MEDIA:
ANALYSTS:
Meghan McAndrew 412-288-8103
J.T. Tuskan 412-288-7895
Ray Hanley 412-288-1920

  
Federated Reports Q2 2014 Earnings
Page 2 of 11

Money-market assets were $245.2 billion at June 30, 2014, down $23.3 billion or 9 percent from $268.5 billion at June 30, 2013 and down $18.4 billion or 7 percent from $263.6 billion at March 31, 2014. Money-market mutual fund assets were$212.4 billion at June 30, 2014, down $20.5 billion or 9 percent from $232.9 billion at June 30, 2013 and down $15.1 billion or 7 percent from $227.5 billion at March 31, 2014.
Financial Summary
Q2 2014 vs. Q2 2013
Revenue decreased by $10.8 million or 5 percent primarily due to an increase in voluntary fee waivers related to certain money- market funds in order for those funds to maintain positive or zero net yields and a decrease in revenue due to lower average money-market and fixed-income assets. The decrease was partially offset by an increase in revenue from higher average equity assets. See additional information about voluntary fee waivers in the table at the end of this financial summary.
During Q2 2014, Federated derived 67 percent of its revenue from equity and fixed-income assets (44 percent from equity assets and 23 percent from fixed-income assets), 32 percent from money-market assets and 1 percent from other products and services.
Operating expenses decreased $3.6 million or 2 percent primarily due to a decrease in distribution expenses associated with lower average money-market assets and increased fee waivers related to the low-yield environment for money-market funds, offset by an increase in distribution expenses associated with higher average equity assets and an increase in compensation and related expense.
Q2 2014 vs. Q1 2014
Revenue increased by $1.5 million or 1 percent primarily due to lower voluntary fee waivers, an additional day in Q2 2014 and an increase in revenue from higher average equity assets.  This increase was partially offset by a decrease in revenue from lower average money-market assets.
Operating expenses were flat.
YTD 2014 vs. YTD 2013
Revenue decreased by $27.3 million or 6 percent primarily due to an increase in voluntary fee waivers and a decrease in revenue resulting from lower average money-market and fixed-income assets. The decrease was partially offset by higher average equity assets.
For the first half of 2014, Federated derived 66 percent of its revenue from equity and fixed-income assets (43 percent from equity assets and 23 percent from fixed-income assets), 33 percent from money-market assets and 1 percent from other products and services.
Operating expenses decreased $8.6 million or 3 percent primarily due to a decrease in distribution expense related to increased fee waivers, which was partially offset by an increase in compensation and related expenses.
Federated's level of business activity and financial results are dependent upon many factors including market conditions, investment performance and investor behavior. These factors and others, including asset levels, product sales and redemptions, market appreciation or depreciation, revenues, fee waivers, expenses and regulatory changes, can significantly impact Federated's activity levels and financial results. Risk factors and uncertainties that can influence Federated's financial results are discussed in the company's annual and quarterly reports as filed with the Securities and Exchange Commission.



  
Federated Reports Q2 2014 Earnings
Page 3 of 11

Fee waivers to maintain positive or zero net yields on money-market funds and the resulting negative impact of these waivers could vary significantly in the future as they are contingent on a number of variables including, but not limited to, changes in assets within the money market funds, available yields on instruments held by the money-market funds, actions by the Federal Reserve, the U.S. Department of the Treasury, the Securities and Exchange Commission, the Financial Stability Oversight Council and other governmental entities, changes in expenses of the money-market funds, changes in the mix of money-market customer assets, changes in the distribution fee arrangements with third parties, Federated’s willingness to continue the fee waivers and changes in the extent to which the impact of the waivers is shared by third parties.
Unaudited Money-Market Fund Yield Waiver Impact to Consolidated Statements of Income
(in millions)
 
Quarter Ended
 
Change
Q2 2013 to Q2 2014
 
Quarter Ended
 
Change
Q1 2014 to Q2 2014
 
Six Months Ended
 
Change
YTD 2013 to YTD 2014
 
June 30, 2014
 
June 30, 2013
 
 
March 31, 2014
 
 
June 30, 2014
 
June 30, 2013
 
Investment advisory fees
$
(69.6
)
 
$
(59.4
)
 
$
(10.2
)
 
$
(73.1
)
 
$
3.5

 
$
(142.7
)
 
$
(114.3
)
 
$
(28.4
)
Other service fees
(32.7
)
 
(32.5
)
 
(0.2
)
 
(33.6
)
 
0.9

 
(66.3
)
 
(65.0
)
 
(1.3
)
Total revenue
(102.3
)
 
(91.9
)
 
(10.4
)
 
(106.7
)
 
4.4

 
(209.0
)
 
(179.3
)
 
(29.7
)
Less: Reduction in distribution expense
70.2

 
66.9

 
3.3

 
74.3

 
(4.1
)
 
144.5

 
131.7

 
12.8

Operating income
(32.1
)
 
(25.0
)
 
(7.1
)
 
(32.4
)
 
0.3

 
(64.5
)
 
(47.6
)
 
(16.9
)
Less: Reduction in noncontrolling interest
2.5

 
1.3

 
1.2

 
2.7

 
(0.2
)
 
5.2

 
2.1

 
3.1

Pre-tax impact
$
(29.6
)
 
$
(23.7
)
 
$
(5.9
)
 
$
(29.7
)
 
$
0.1

 
$
(59.3
)
 
$
(45.5
)
 
$
(13.8
)

Federated will host an earnings conference call at 9 a.m. Eastern on July 25, 2014. Investors are invited to listen to Federated's earnings teleconference by calling 877-407-0782 (domestic) or 201-689-8567 (international) prior to the 9 a.m. start time. The call may also be accessed in real time on the Internet via the About Federated section of FederatedInvestors.com. A replay will be available after 12:30 p.m. and through Aug. 1, 2014 by calling 877-660-6853 (domestic) or 201-612-7415 (international) and entering access code 13586188.
Federated Investors, Inc. is one of the largest investment managers in the United States, managing $351.6 billion in assets as of June 30, 2014. With 133 funds and a variety of separately managed account options, Federated provides comprehensive investment management to nearly 6,100 institutions and intermediaries including corporations, government entities, insurance companies, foundations and endowments, banks and broker/dealers. Federated ranks in the top 3 percent of money-market fund managers in the industry, the top 6 percent of equity fund managers and the top 10 percent of fixed-income fund managers1. For more information, visit FederatedInvestors.com.
###
1) Strategic Insight, May 31, 2014. Based on assets under management in open-end funds.
Federated Securities Corp. is distributor of the Federated funds.
Separately managed accounts are made available through Federated Global Investment Management Corp., Federated Investment Counseling and Federated MDTA LLC, each a registered investment adviser.

Certain statements in this press release, such as those related to the level of fee waivers and expenses incurred by the company, product demand and performance, investor interest and preferences, asset flows and mix, fee arrangements with customers, distribution expense, regulatory changes and market conditions constitute or may constitute forward-looking statements, which involve known and unknown risks, uncertainties and other factors that may cause the actual results, levels of activity, performance or achievements of the company, or industry results, to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements.  Other risks and uncertainties include the ability of the company to predict the level of fee waivers and expenses in future quarters, which could vary significantly depending on a variety of factors identified above, and include the ability of the company to sustain product demand and asset flows and mix, which could vary significantly depending on market conditions, investment performance and



  
Federated Reports Q2 2014 Earnings
Page 4 of 11

investor behavior.  Other risks and uncertainties also include the risk factors discussed in the company's annual and quarterly reports as filed with the Securities and Exchange Commission.  As a result, no assurance can be given as to future results, levels of activity, performance or achievements, and neither the company nor any other person assumes responsibility for the accuracy and completeness of such statements in the future.



  
Federated Reports Q2 2014 Earnings
Page 5 of 11

Unaudited Condensed Consolidated Statements of Income
(in thousands, except per share data)
 
 
 
 
 
 
Quarter Ended
% Change Q2 2013 to Q2 2014
Quarter Ended
 % Change Q1 2014 to Q2 2014
 
June 30, 2014
June 30, 2013
March 31, 2014
Revenue
 
 
 
 
 
Investment advisory fees, net
$
137,553

$
147,515

(7
)%
$
135,093

2
 %
Administrative service fees, net
52,738

55,253

(5
)
54,727

(4
)
Other service fees, net
21,447

19,856

8

20,780

3

Other, net
1,243

1,182

5

896

39

Total Revenue
212,981

223,806

(5
)
211,496

1

 
 
 
 
 
 
Operating Expenses
 
 
 
 
 
Compensation and related
70,693

67,855

4

71,759

(1
)
Distribution
49,256

53,809

(8
)
48,558

1

Professional service fees
8,177

9,293

(12
)
8,381

(2
)
Office and occupancy
7,286

6,543

11

6,915

5

Systems and communications
6,225

6,087

2

6,404

(3
)
Travel and related
3,538

3,533

0

2,861

24

Advertising and promotional
2,959

3,936

(25
)
3,439

(14
)
Other
6,005

6,722

(11
)
6,534

(8
)
Total Operating Expenses
154,139

157,778

(2
)
154,851

0

Operating Income
58,842

66,028

(11
)
56,645

4

 
 
 
 
 
 
Nonoperating Income (Expenses)
 
 
 
 
 
Investment income, net
4,311

4,059

6

3,613

19

Debt expense
(2,849
)
(3,137
)
(9
)
(2,812
)
1

Other, net
(5
)
(30
)
(83
)
(5
)
0

Total Nonoperating Income, net
1,457

892

63

796

83

Income before income taxes
60,299

66,920

(10
)
57,441

5

Income tax provision
22,985

25,059

(8
)
21,796

5

Net income including the noncontrolling interests in subsidiaries
37,314

41,861

(11
)
35,645

5

Less: Net income attributable to the noncontrolling interests in subsidiaries
445

1,453

(69
)
451

(1
)
Net Income
$
36,869

$
40,408

(9
)%
$
35,194

5
 %
 
 
 
 
 
 
Amounts Attributable to Federated
 
 
 
 
 
Earnings Per Share1
 
 
 
 
 
Basic and diluted
$
0.35

$
0.39

(10
)%
$
0.34

3
 %
Weighted-average shares outstanding
 
 
 
 
 
Basic
100,789

100,716

 
100,725

 
Diluted
100,790

100,717

 
100,727

 
Dividends declared per share
$
0.25

$
0.24

 
$
0.25

 
1) Unvested share-based payment awards that receive non-forfeitable dividend rights are deemed participating securities and are required to be considered in the computation of earnings per share under the “two-class method.” As such, total net income of $1.5 million, $1.5 million and $1.4 million available to unvested restricted shareholders for the quarterly periods ended June 30, 2014, June 30, 2013 and March 31, 2014, respectively, was excluded from the computation of earnings per share.




  
Federated Reports Q2 2014 Earnings
Page 6 of 11

Unaudited Condensed Consolidated Statements of Income
(in thousands, except per share data)
 
 
 
 
 
 
 
 
Six Months Ended
 
 
 
 
June 30, 2014
 
June 30, 2013
 
% Change
Revenue
 
 
 
 
 
 
Investment advisory fees, net
 
$
272,646

 
$
298,278

 
(9
)%
Administrative service fees, net
 
107,465

 
112,081

 
(4
)
Other service fees, net
 
42,227

 
39,187

 
8

Other, net
 
2,139

 
2,231

 
(4
)
Total Revenue
 
424,477

 
451,777

 
(6
)
 
 
 
 
 
 
 
Operating Expenses
 
 
 
 
 
 
Compensation and related
 
142,452

 
134,792

 
6

Distribution
 
97,814

 
112,048

 
(13
)
Professional service fees
 
16,558

 
18,137

 
(9
)
Office and occupancy
 
14,201

 
12,975

 
9

Systems and communications
 
12,629

 
12,710

 
(1
)
Travel and related
 
6,399

 
6,219

 
3

Advertising and promotional
 
6,398

 
7,358

 
(13
)
Other
 
12,539

 
13,311

 
(6
)
Total Operating Expenses
 
308,990

 
317,550

 
(3
)
Operating Income
 
115,487

 
134,227

 
(14
)
 
 
 
 
 
 
 
Nonoperating Income (Expenses)
 
 
 
 
 
 
Investment income, net
 
7,924

 
8,487

 
(7
)
Debt expense
 
(5,662
)
 
(6,390
)
 
(11
)
Other, net
 
(9
)
 
(70
)
 
(87
)
Total Nonoperating Income, net
 
2,253

 
2,027

 
11

Income before income taxes
 
117,740

 
136,254

 
(14
)
Income tax provision
 
44,781

 
49,705

 
(10
)
Net income including the noncontrolling interests in subsidiaries
 
72,959

 
86,549

 
(16
)
Less: Net income attributable to the noncontrolling interests in subsidiaries
 
896

 
3,147

 
(72
)
Net Income
 
$
72,063

 
$
83,402

 
(14
)%
 
 
 
 
 
 
 
Amounts Attributable to Federated
 
 
 
 
 
 
Earnings Per Share1 
 
 
 
 
 
 
Basic and diluted
 
$
0.69

 
$
0.80

 
(14
)%
Weighted-average shares outstanding
 
 
 
 
 
 
Basic
 
100,757

 
100,617

 
 
Diluted
 
100,759

 
100,618

 
 
Dividends declared per share
 
$
0.50

 
$
0.48

 
 
1) Unvested share-based payment awards that receive non-forfeitable dividend rights are deemed participating securities and are required to be considered in the computation of earnings per share under the “two-class method.” As such, total net income of $2.9 million and $3.2 million available to unvested restricted shareholders for the six months ended June 30, 2014 and June 30, 2013, respectively, was excluded from the computation of earnings per share.



  
Federated Reports Q2 2014 Earnings
Page 7 of 11

Unaudited Condensed Consolidated Balance Sheets
 
 
(in thousands)
June 30, 2014

Dec. 31, 2013

Assets
 
 
Cash and other investments
$
263,595

$
292,178

Other current assets
45,128

47,140

Intangible assets, net and goodwill
734,761

735,345

Other long-term assets
61,654

61,134

Total Assets
$
1,105,138

$
1,135,797

 
 
 
Liabilities, Redeemable Noncontrolling Interests and Equity
 
 
Current liabilities
$
118,722

$
214,205

Long-term debt
229,500

198,333

Other long-term liabilities
152,082

141,398

Redeemable noncontrolling interests
17,302

15,517

Equity excluding treasury stock
1,338,536

1,317,583

Treasury stock
(751,004
)
(751,239
)
Total Liabilities, Redeemable Noncontrolling Interests and Equity
$
1,105,138

$
1,135,797




  
Federated Reports Q2 2014 Earnings
Page 8 of 11

Unaudited Changes in Equity and Fixed-Income Fund and Separate Account Assets
(in millions; excludes liquidation portfolio)
 
Quarter Ended
 
Six Months Ended
 
June 30, 2014
March 31, 2014
June 30, 2013
 
June 30, 2014
June 30, 2013
Equity funds
 
 
 
 
 
 
Beginning assets
$
29,208

$
28,097

$
24,491

 
$
28,097

$
23,152

Sales
2,566

2,292

1,918

 
4,858

3,670

Redemptions
(1,464
)
(1,833
)
(1,629
)
 
(3,297
)
(4,017
)
Net sales (redemptions)
1,102

459

289

 
1,561

(347
)
Net exchanges
9

32

43

 
41

90

Market gains and losses/reinvestments1
1,354

620

207

 
1,974

2,135

Ending assets
$
31,673

$
29,208

$
25,030

 
$
31,673

$
25,030

 
 
 
 
 
 
 
Equity separate accounts2
 
 
 
 
 
 
Beginning assets
$
16,671

$
16,051

$
13,361

 
$
16,051

$
11,858

Sales3
1,168

845

1,031

 
2,013

2,137

Redemptions3
(746
)
(778
)
(937
)
 
(1,524
)
(1,505
)
Net sales3
422

67

94

 
489

632

Market gains and losses4
1,122

553

220

 
1,675

1,185

Ending assets
$
18,215

$
16,671

$
13,675

 
$
18,215

$
13,675

 
 
 
 
 
 
 
Total equity2
 
 
 
 
 
 
Beginning assets
$
45,879

$
44,148

$
37,852

 
$
44,148

$
35,010

Sales3
3,734

3,137

2,949

 
6,871

5,807

Redemptions3
(2,210
)
(2,611
)
(2,566
)
 
(4,821
)
(5,522
)
Net sales3
1,524

526

383

 
2,050

285

Net exchanges
9

32

43

 
41

90

Market gains and losses/reinvestments1
2,476

1,173

427

 
3,649

3,320

Ending assets
$
49,888

$
45,879

$
38,705

 
$
49,888

$
38,705

 
 
 
 
 
 
 
Fixed-income funds
 
 
 
 
 
 
Beginning assets
$
40,237

$
39,606

$
42,612

 
$
39,606

$
42,478

Sales
3,325

4,248

5,232

 
7,573

10,380

Redemptions
(3,940
)
(4,025
)
(6,877
)
 
(7,965
)
(11,886
)
Net (redemptions) sales
(615
)
223

(1,645
)
 
(392
)
(1,506
)
Net exchanges
(11
)
(59
)
(80
)
 
(70
)
(122
)
Acquisition related
301

0

0

 
301

0

Market gains and losses/reinvestments1
445

467

(699
)
 
912

(662
)
Ending assets
$
40,357

$
40,237

$
40,188

 
$
40,357

$
40,188

 
 
 
 
 
 
 
Fixed-income separate accounts2
 
 
 
 
 
 
Beginning assets
$
10,746

$
10,520

$
10,158

 
$
10,520

$
10,233

Sales3
377

254

562

 
631

1,093

Redemptions3
(537
)
(232
)
(725
)
 
(769
)
(1,370
)
Net (redemptions) sales3
(160
)
22

(163
)
 
(138
)
(277
)
Net exchanges
1

0

7

 
1

7

Market gains and losses4
185

204

(185
)
 
389

(146
)
Ending assets
$
10,772

$
10,746

$
9,817

 
$
10,772

$
9,817

 
 
 
 
 
 
 
Total fixed income2
 
 
 
 
 
 
Beginning assets
$
50,983

$
50,126

$
52,770

 
$
50,126

$
52,711

Sales3
3,702

4,502

5,794

 
8,204

11,473

Redemptions3
(4,477
)
(4,257
)
(7,602
)
 
(8,734
)
(13,256
)
Net (redemptions) sales3
(775
)
245

(1,808
)
 
(530
)
(1,783
)
Net exchanges
(10
)
(59
)
(73
)
 
(69
)
(115
)
Acquisition related
301

0

0

 
301

0

Market gains and losses/reinvestments1
630

671

(884
)
 
1,301

(808
)
Ending assets
$
51,129

$
50,983

$
50,005

 
$
51,129

$
50,005

1) Reflects the approximate changes in the fair value of the securities held by the portfolios and, to a lesser extent, reinvested dividends, distributions, net investment income and the impact of changes in foreign exchange rates.
2) Includes separately managed accounts, institutional accounts and sub-advised funds and other managed products.
3) For certain accounts, Sales and Redemptions are calculated as the remaining difference between beginning and ending assets after the calculation of Market gains and losses.
4) Reflects the approximate changes in the fair value of the securities held by the portfolios.







  
Federated Reports Q2 2014 Earnings
Page 9 of 11

Unaudited Total Changes in Equity and Fixed-Income Assets
(in millions; excludes liquidation portfolio)
 
Quarter Ended
 
Six Months Ended
 
June 30, 2014
March 31, 2014
June 30, 2013
 
June 30, 2014
June 30, 2013
 
 
 
 
 
 
 
Funds
 
 
 
 
 
 
Beginning assets
$
69,445

$
67,703

$
67,103

 
$
67,703

$
65,630

Sales
5,891

6,540

7,150

 
12,431

14,050

Redemptions
(5,404
)
(5,858
)
(8,506
)
 
(11,262
)
(15,903
)
Net sales (redemptions)
487

682

(1,356
)
 
1,169

(1,853
)
Net exchanges
(2
)
(27
)
(37
)
 
(29
)
(32
)
Acquisition related
301

0

0

 
301

0

Market gains and losses/reinvestments1
1,799

1,087

(492
)
 
2,886

1,473

Ending assets
$
72,030

$
69,445

$
65,218

 
$
72,030

$
65,218

 
 
 
 
 
 
 
Separate accounts2
 
 
 
 
 
 
Beginning assets
$
27,417

$
26,571

$
23,519

 
$
26,571

$
22,091

Sales3
1,545

1,099

1,593

 
2,644

3,230

Redemptions3
(1,283
)
(1,010
)
(1,662
)
 
(2,293
)
(2,875
)
Net sales (redemptions)3
262

89

(69
)
 
351

355

Net exchanges
1

0

7

 
1

7

Market gains and losses4
1,307

757

35

 
2,064

1,039

Ending assets
$
28,987

$
27,417

$
23,492

 
$
28,987

$
23,492

 
 
 
 
 
 
 
Total assets 2
 
 
 
 
 
 
Beginning assets
$
96,862

$
94,274

$
90,622

 
$
94,274

$
87,721

Sales3
7,436

7,639

8,743

 
15,075

17,280

Redemptions3
(6,687
)
(6,868
)
(10,168
)
 
(13,555
)
(18,778
)
Net sales (redemptions)3
749

771

(1,425
)
 
1,520

(1,498
)
Net exchanges
(1
)
(27
)
(30
)
 
(28
)
(25
)
Acquisition related
301

0

0

 
301

0

Market gains and losses/reinvestments1
3,106

1,844

(457
)
 
4,950

2,512

Ending assets
$
101,017

$
96,862

$
88,710

 
$
101,017

$
88,710

1) Reflects the approximate changes in the fair value of the securities held by the portfolios and, to a lesser extent, reinvested dividends, distributions, net investment income and the impact of changes in foreign exchange rates.
2) Includes separately managed accounts, institutional accounts and sub-advised funds and other managed products.
3) For certain accounts, Sales and Redemptions are calculated as the remaining difference between beginning and ending assets after the calculation of Market gains and losses.
4) Reflects the approximate changes in the fair value of the securities held by the portfolios.




  
Federated Reports Q2 2014 Earnings
Page 10 of 11

(unaudited)
 
 
 
 
 
MANAGED ASSETS
(in millions)
June 30, 2014
March 31, 2014
Dec. 31, 2013
Sept. 30, 2013
June 30, 2013
By Asset Class
 
 
 
 
 
Equity
$
49,888

$
45,879

$
44,148

$
40,283

$
38,705

Fixed-income
51,129

50,983

50,126

49,962

50,005

Money market
245,201

263,648

275,952

270,293

268,532

Liquidation portfolio1
5,408

5,690

5,858

6,177

6,561

Total Managed Assets
$
351,626

$
366,200

$
376,084

$
366,715

$
363,803

By Product Type
 
 
 
 
 
Funds:
 
 
 
 
 
Equity
$
31,673

$
29,208

$
28,097

$
25,930

$
25,030

Fixed-income
40,357

40,237

39,606

39,944

40,188

Money market
212,434

227,470

240,048

237,949

232,874

Total Fund Assets
$
284,464

$
296,915

$
307,751

$
303,823

$
298,092

Separate accounts:
 
 
 
 
 
Equity
$
18,215

$
16,671

$
16,051

$
14,353

$
13,675

Fixed-income
10,772

10,746

10,520

10,018

9,817

Money market
32,767

36,178

35,904

32,344

35,658

Total Separate Accounts
$
61,754

$
63,595

$
62,475

$
56,715

$
59,150

Total Liquidation Portfolio1
$
5,408

$
5,690

$
5,858

$
6,177

$
6,561

Total Managed Assets
$
351,626

$
366,200

$
376,084

$
366,715

$
363,803

 
AVERAGE MANAGED ASSETS
Quarter Ended
(in millions)
June 30, 2014
March 31, 2014
Dec. 31, 2013
Sept. 30, 2013
June 30, 2013
By Asset Class
 
 
 
 
 
Equity
$
47,466

$
44,693

$
42,539

$
39,910

$
38,762

Fixed-income
50,774

50,658

50,268

49,983

52,375

Money market
254,575

273,233

267,351

267,881

274,899

Liquidation portfolio1
5,569

5,791

6,050

6,434

6,834

Total Avg. Assets
$
358,384

$
374,375

$
366,208

$
364,208

$
372,870

By Product Type





Funds:





Equity
$
30,154

$
28,516

$
27,157

$
25,761

$
25,094

Fixed-income
40,130

39,987

39,883

39,987

42,258

Money market
219,936

235,228

234,788

234,528

237,790

Total Avg. Fund Assets
$
290,220

$
303,731

$
301,828

$
300,276

$
305,142

Separate accounts:





Equity
$
17,312

$
16,177

$
15,382

$
14,149

$
13,668

Fixed-income
10,644

10,671

10,385

9,996

10,117

Money market
34,639

38,005

32,563

33,353

37,109

Total Avg. Separate Accounts
$
62,595

$
64,853

$
58,330

$
57,498

$
60,894

Total Avg. Liquidation Portfolio1
$
5,569

$
5,791

$
6,050

$
6,434

$
6,834

Total Avg. Managed Assets
$
358,384

$
374,375

$
366,208

$
364,208

$
372,870

1) Liquidation portfolio represents a portfolio of distressed bonds at cost. Federated has been retained by a third party to manage these assets through an orderly liquidation process that will generally occur over a multi-year period. Management-fee rates earned from this portfolio are lower than those of traditional separate account mandates.



  
Federated Reports Q2 2014 Earnings
Page 11 of 11

(unaudited)
 
 
 
 
AVERAGE MANAGED ASSETS
 
Six Months Ended
(in millions)
 
June 30, 2014
 
June 30, 2013
By Asset Class
 
 
 
 
Equity
 
$
46,079

 
$
37,724

Fixed-income
 
50,716

 
52,553

Money market
 
263,904

 
279,743

Liquidation portfolio1
 
5,680

 
7,025

Total Avg. Assets
 
$
366,379

 
$
377,045

By Product Type
 
 
 
 
Funds:
 
 
 
 
Equity
 
$
29,335

 
$
24,566

Fixed-income
 
40,058

 
42,419

Money market
 
227,582

 
244,221

Total Avg. Fund Assets
 
$
296,975

 
$
311,206

Separate Accounts:
 
 
 
 
Equity
 
$
16,744

 
$
13,158

Fixed-income
 
10,658

 
10,134

Money market
 
36,322

 
35,522

Total Avg. Separate Accounts
 
$
63,724

 
$
58,814

Total Avg. Liquidation Portfolio1
 
$
5,680

 
$
7,025

Total Avg. Managed Assets
 
$
366,379

 
$
377,045

1) Liquidation portfolio represents a portfolio of distressed bonds at cost. Federated has been retained by a third party to manage these assets through an orderly liquidation process that will generally occur over a multi-year period. Management-fee rates earned from this portfolio are lower than those of traditional separate account mandates.







GRAPHIC 3 prheadera02a01a011a01.jpg begin 644 prheadera02a01a011a01.jpg M_]C_X``02D9)1@`!`@$`R`#(``#_X@Q824-#7U!23T9)3$4``0$```Q(3&EN M;P(0``!M;G1R4D="(%A96B`'S@`"``D`!@`Q``!A8W-P35-&5`````!)14,@ M0``9&5S8P`````````2D! M\@'Z`@,"#`(4`AT")@(O`C@"00)+`E0"70)G`G$">@*$`HX"F`*B`JP"M@+! M`LL"U0+@`NL"]0,``PL#%@,A`RT#.`-#`T\#6@-F`W(#?@.*`Y8#H@.N`[H# MQP/3`^`#[`/Y!`8$$P0@!"T$.P1(!%4$8P1Q!'X$C`2:!*@$M@3$!-,$X03P M!/X%#044%]@8&!A8&)P8W!D@& M609J!GL&C`:=!J\&P`;1!N,&]0<'!QD'*P<]!T\'80=T!X8'F0>L![\'T@?E M!_@("P@?"#((1@A:"&X(@@B6"*H(O@C2".<(^PD0"24).@E/"60)>0F/":0) MN@G/">4)^PH1"B<*/0I4"FH*@0J8"JX*Q0K<"O,+"PLB"SD+40MI"X`+F`NP M"\@+X0OY#!(,*@Q##%P,=0R.#*<,P`S9#/,-#0TF#4`-6@UT#8X-J0W##=X- M^`X3#BX.20YD#G\.FPZV#M(.[@\)#R4/00]>#WH/E@^S#\\/[!`)$"800Q!A M$'X0FQ"Y$-<0]1$3$3$13Q%M$8P1JA')$>@2!Q(F$D429!*$$J,2PQ+C$P,3 M(Q-#$V,3@Q.D$\43Y10&%"<4211J%(L4K13.%/`5$A4T%585>!6;%;T5X!8# M%B86219L%H\6LA;6%OH7'1=!%V47B1>N%](7]Q@;&$`891B*&*\8U1CZ&2`9 M11EK&9$9MQG=&@0:*AI1&G<:GAK%&NP;%!L[&V,;BANR&]H<`APJ'%(<>QRC M',P<]1T>'4<=:AZ4'KX>Z1\3'SX?:1^4'[\?ZB`5($$@ M;""8(,0@\"$<(4@A=2&A(B>K)]PH#2@_*'$H MHBC4*08I."EK*9TIT"H"*C4J:"J;*L\K`BLV*VDKG2O1+`4L.2QN+*(LURT, M+4$M=BVK+>$N%BY,+H(NMR[N+R0O6B^1+\<-]1B)&9T:K1O!'-4=[1\!( M!4A+2)%(UTD=26-)J4GP2C=*?4K$2PQ+4TN:2^),*DQR3+I-`DU*39--W$XE M3FY.MT\`3TE/DT_=4"=0<5"[40914%&;4>92,5)\4L=3$U-?4ZI3]E1"5(]4 MVU4H5755PE8/5EQ6J5;W5T17DE?@6"]8?5C+61I9:5FX6@=:5EJF6O5;15N5 M6^5<-5R&7-9=)UUX7&EYL7KU?#U]A7[-@!6!78*I@_&%/8:)A]6))8IQB M\&-#8Y=CZV1`9)1DZ64]99)EYV8]9I)FZ&<]9Y-GZ6@_:)9H[&E#:9II\6I( M:I]J]VM/:Z=K_VQ7;*]M"&U@;;EN$FYK;L1O'F]X;]%P*W"&<.!Q.G&5&YXS'DJ>8EYYWI& M>J5[!'MC>\)\(7R!?.%]07VA?@%^8G["?R-_A'_E@$>`J($*@6N!S8(P@I*" M](-7@[J$'82`A..%1X6KA@Z&I+CDTV3MI0@E(J4 M])5?EAMJ(FHI:C!J-VH^:D5J3'I3BEJ:8:IHNF_:=NI^"H M4JC$J3>IJ:H_ MR#W(O,DZR;G*.,JWRS;+MLPUS+7--:6YQ_GJ>@RZ+SI1NG0ZEOJ MY>MPZ_OLANT1[9SN*.ZT[T#OS/!8\.7Q'",G'!T='"'EZ@X2%AH>(B8J2DY25 MEI>8F9JBHZ2EIJ>HJ:JRL[2UMK>XN;K"P\3%QL?(R;GZ.GJ\?+S]/7V]_CY^O_$`!\!``,!`0$!`0$!`0$````````!`@,$!08' M"`D*"__$`+41``(!`@0$`P0'!00$``$"=P`!`@,1!`4A,08205$'87$3(C*! M"!1"D:&QP0DC,U+P%6)RT0H6)#3A)?$7&!D:)BH*#A(6&AXB)BI*3E)66EYB9FJ*C MI*6FIZBIJK*SM+6VM[BYNL+#Q,7&Q\C)RM+3U-76U]C9VN+CY.7FY^CIZO+S M]/7V]_CY^O_:``P#`0`"$0,1`#\`](U76+;18Q)<-L4G:#AFYP3_``@^E9?_ M``G^C_\`/?\`\6UUT,-&I"[.2OB94YV1[ M%_PG^C_\]_\`QR3_`.(H_P"$_P!'_P">_P#XY)_\17CM%:_4H=V9?79]D>Q? M\)_H_P#SW_\`')/_`(BC_A/]'_Y[_P#CDG_Q%>.T4?4H=V'UV?9'L7_"?Z/_ M`,]__')/_B*U-*UBVUJ,R6[;U!VDX9><`_Q`>M>$UZE\+?\`D'2?]=F_]`2L MJ^&C3A=&M#$RJ3LSL:***Y#K"BBB@`HHJOJ-W]@MI)L;O+1GQTSM!.*$K@W8 ML45Y[_PMG_IV_P#(G_VNC_A;/_3M_P"1/_M=;?5:O8Q^M4NYZ%1116)L%%%% M`!1110`4444`%%%%`!1110`4444`%%%%`!1110`4444`%%%%`!1110`445SW MBSQ9_P`(OY7[KS/,W?Q;<;=O^RW]ZJC%R=D3*2BKLZ&BO/?^%L_].W_D3_[7 M6SX6\XJ>N'TG_`)&^[_ZXK_*"NXH`****`"BB MB@`HK.U_[9]C?['_`*[Y=GW?[PS][CIFO-KOQ=XAL,>J9ZU17CO_``G^L?\`/?\`\K45Y+-XTU[39%$S%3PVR2-5R,_[JG!QVK8TGXI%W"W M48`)YDCS\H_W3N)YZ\].WJI82HE?<<<73;ML>A45#9WD6H1++$P9&&585-7. MU8Z-PHHHH`****`"BBB@`HHHH`****`"BBB@`HHHH`****`"BBN#\8:SKNGW M;_9PRPJH8,L8<8QEBS%6Q@Y].!T[FZ=-S=B*E105SO**\=_X3_6/^>__`(Y' M_P#$5-:^,M?OFVQ.SD#.$B1CCUX2MOJD454TW5 M+?5XO-@<.N2,C(Y'8@\BK=8--&Z:84444AA1110`50U+7+/2!^_E5#@':3EL M$XR%'S'\JXSQ;J>OHLQ"^3!&Y7?&0K,I9=ASN+=Q]W'4@]P.`DD:9BS$DDY) M/))/6UZ6$_AGFXO^(%7K/0K[4`I MBAD8,<*P4[>N/O=/UK7\`:3!J^H;9AN5$,@7L2&4#/J.>GY\<5Z]2KXGV;LD M.AAO:*[9P-QX3T'PSL-[([%P0`V[:2N,D",9'7N>_>K.E:/X8UJ0QVZ[V`W$ M9G7C('\1'K73:KH=IK:JMQ&'"G*\D$?BI!J/2O#=CHC,UO&$+#!.68X]/F)Q M7+[:\=Y(?AH;2(RVC,^TN2I&,_[N/QS@5K_"W_ M`)!TG_79O_0$K6\2>++;PTH#Y9V!*QKU^I]!GC/Y`X-<))\1;F%I?LT,<0D) M<]6;<5`+=0N>,_=^N>#J(I8RFSTRBJ6DZM!K<`FA.5/4=U/< M$>O_`.L<5G^)_%L'AI!D;Y&^[&#CCU)YP/YG\<8*$G*UM3=SBHWOH;M9WB+_ M`)!US_UQD_\`0#7GW_"TM1_YYP_]\O\`_%TYOB3->V\T-Q$N)(V16CR,%E8< MAB<\X[C'O6ZPM1.Y@\53:L<91117HGG'T'139)%A4LQ``&23P`!W-<#K/Q1" M-MLXPP!^_+G!Z]%!!]#DG_@->13I2J/0]>I5C36IZ!17D-Q\1-6FM45R7AKX@P: MRZPS+Y4C<`Y^1CQT/4$G.!^&XFM3Q3XA_P"$:MEFV>9N<)C=MZACGH?2L72F MI'RUPS,^_=@(C.>` M@S]VK>&J);$+$TV]SM:*\UO_`(J7+2'[/$@3MYF68\]?E90..W/UKJ=.\5H- M)2^NB%SNX3N0S`!02>3CU]^!2EAYQ2NAQQ$)-V9T-%>;W_Q5F9O]'A50">9" M6)';A2N/?DUDW'Q$U:9RRR!`?X51<#_OH,?UJXX2HR)8NFCUZBO*;?XFZG"@ M5A&Y'\3*Z\GO2EA:D4 M..*IR9N>)_$"^&K83%"Y+!%4'')R>3SV![5Q%_\`%*\FR(8TC!&,MEV!]0?E M'Y@U3\:>*;G5))+1U0)%,VTJ#N^0LHSEB.A]*Y:NFAAHJ-Y+4YJ^)DY6B]#L M_"7B2_U?5X1-,S`A@5'RJ<(YY5<`_E7J%>$:/JLFBW*W$8!9,X#9Q\RE>Q'K M7K'@S7YO$5HTLH4$2%/D!`P%4]R?6LL72L[K8UPE6ZL]S?HKB-?^)<5FS1VB MB1@<>8WW.W3'+=_3U&17-77Q&U6X;*NL8QC:B`CZ_/N/ZUG#"U)(TGBJ<6>N M45Y':_$;5;=LLZR#&-KH`/K\FT_K72Z!\2XKQECNU$;$X\Q?N=^N>5[>OJ<" MB>%J100Q5.3.WHHK@_$/Q+%I*8K15?:>9&R5/7(4#&?][/X8P:SITY5'9&E2 MI&FKL[RO/?BS_P`NW_;3_P!IUG_\+2U'_GG#_P!\O_\`%U3\8>*X_$Z0%4*- M'OW`D$?-MQ@\9^[Z"NFCAYPJ)LYJV(A.FTCFJ['X6_\`(1D_ZXM_Z&E<=78_ M"W_D(R?]<6_]#2NG$?PV"0#D?*Q&= MK=F'3I^O3H:\+KW^XN$M(VD_"O4W$DMJ>5( M\T>Q!53V[Y'?C'O7HU>6_"W_`)",G_7%O_0TKM_$GBRV\-*`^6=@2L:]?J?0 M9XS^0.#66)@W5LC7#32I79MT5SWA/Q9_PE'F_NO+\O;_`!;L[MW^RO\`=K+U M;XG06,YCAC\Y5X+[]H)[X^5LCW[]N.3DJ,W*UM35UH*/-?0[6BJ&AZJNMVD= MPJE0X/RGL02I_44W6M>M=`C#SMC.=JCEF(&>!_7ITR:GE=[=2N96OT-&BN!E M^*FWYEM24)(5B^,XQ_L$9P1D9.,UL^&/'$'B)S$5\J3JJEMVX>QP.1Z>G/KB MY4*D5=HB->G)V3.EHHKD-9^)5GI[;(%,Y!Y(.U._1L'/X#&.]1"G*;T1IP)-&LGR#]6IQ5W84G97/$Z[OX4VJO-/+SE M55!Z8@PG/XJ:]+%2M39YN%C>HCI;RSB MU")HI5#(PPRFO"+VU:QF>)L$HQ0XZ94XXKW>\O(M/B:65@J*,LQKPB]NFOIG ME;`+L7..F6.>*QP5]>QMC;:=SI_AKJ;VFH>0.5F!!^J`L#T^H_'VKU:O)?AQ M827.IK(H^6(,S'G^)2H'UY_(&O6JSQEO:&F#O[,***Y+5?B-:VL@BMD-PY.W MY>%SDC`."6.?08.>#6$(2F]$;SG&"U9UM%>?Q_%A2PW6Q`SR1)DX]AL&?S%= MKI>I1:O;I/%G:XR,C!X."#]#53HSANB85H3V9R_Q1O!#8QQ!B"\F=HSRJ`YS M]"5_R*\]T*S&H7T,14L&D4,HS]W/S=/;-=3\5;IGNX8N,+&7'KEV(/\`Z`*H M_#>T^TZJ&SCRT9_KGY,?^/YKLI>Y0N<=7WZ]CUJBBFR2+"I9B``,DG@`#N:\ M\]`=17&7_P`3+>.39;1-/@$EN4&`-V1\I/'.<@8QZ54M_BO&S@26Y5>Y5PQ_ M(JO\ZV6&J-;&+Q%-/<[ZBFQR+,H92"",@CD$'N*=6)L%%8VM^+;#0>)7R_\` MSS3YF[=>PX.>2,]JYB3XL*&.VV)&>"9,''N-AQ^9K2%"I-72,YUZ<'JST"BN M6\+>./\`A);EH?)\O:A?._=T*C'W1ZUU-3.$H.S*A.,U=!16!XA\:6?A\E&) M>4#_`%:^X.-QZ#^?.<5SG_"V?^G;_P`B?_:ZN-"I)72(E7IQ=FST*BLCPWXD MA\2PF2,%2I`="1D'&>W;T/&<'BM>LY1<79FD9*2N@HK(UWQ19^'@/.8EB,JB MC+$9QGT'XD9P<5RS?%5D`)M2`PRN9.HR1D?N_4&KA0G-72(G6A!V;/0**P/" M_B^'Q,&4*8W099"0>"3RO0GMG@8R*WZF47%V949*2N@HHHJ2@HHHH`****`" MBBB@`HHHH`****`"BBB@`HHHH`****`"BBB@`HHHH`****`"BBB@`HHHH`** M**`"BBB@`HHHH`****`"BBB@`HHHH`****`"BBB@`HHHH`****`"BBB@`HHH MH`****`"BBB@`HHHH`****`"BBB@`HHHH`****`..^*7_(.C_P"NR_\`H#UY M;7J7Q2_Y!T?_`%V7_P!`>O+:]+"?PSS<7_$+FDZM/HLWFPG#8*^WS#'3OCJ, M\9`J3_A(M1_Y^9O^_C_XUGU!T[UM)1W9C%RV1K:3XA@U2P^U_=4`F0?>*;/O=/S'9 M?\(!K'_/#_Q^/_XNNIT+2[S1M%O8;B/9\DCJ=RMG='@CY2<8V_K[5RXB-.2T M:N=6'E4B]4['GNH7\FISO-(TU#R!RLP(/U0%@>GU'X^U9'BVZ:\U2X9L`B0IQZ1_(/ MT6CPE=-9ZI;LN"3($Y])/D/Z-6;<7#W@X7VQG/'J!7G5=C\ M4O\`D(Q_]<5_]#>N.K'#)*FC;$MNHSJ_`'AJWU^61I\E8@OR#(W%]W4CGC'^ M>APM2PS_V=;>3Y/EIY?\` MSSVC;US]W&.O-9VM:S9^$;4':!U$<2`+N/7@#H.>3_4@'D^M\S5HG7]4Y4[R M/%:ZWP=X+C\26TLLCE<'9'MQ][&26!'(Y'0CO4UY\4;Z8L(HXT!&%SEV''7. M0#_WS^=9O_"?ZQ_SW_\`'(__`(BMI>UE'16^9E'V49:N_P`CGJ***V,#K?$_ MAZ&VTZ*_WNTMP4:3=MVYD1G;`"CO7)5Z#XP_Y%VS_P"V/_HEJ\^K&A)N.IM7 MBE+0U/#&E1ZU?QV\A(5]V2N,_*C-W!]*ZWQ7#'X-TS[';LY^T.S,S$9V@*&& M5V]>!T/&ZN?\`?\`(8@_X'_Z+>M;XJW3/=PQ<86,N/7+L0?_`$`5%2[K)=-R MZ=E1;Z['$5O^"M"B\07WERD[$4R,!_%@@;<]NO\`GK6!4UK>S6+;HG9"1C*$ MJ<>G%;S3<6D80:4DV7O$^E1Z+?R6\9)5-N"V,_,BMV`]:RZFNKV:^;=*[.0, M90Q('W2RC`_P"`,!Z_SKSRNA_Y MEW_M[_\`:-<]6=&*C?U-*TG*WH365JU],D2X!=@@STRQQS6OXK\+/X8D12_F M*X)#8V\@\C&YNF1^=2>`/^0Q!_P/_P!%O70?%G_EV_[:?^TZF51JLH]"HTTZ M+EU//J['X6_\A&3_`*XM_P"AI7'5V/PM_P"0C)_UQ;_T-*K$?PV3A_XB/4J* M**\H]4****`"BBB@#A])_P"1ON_^N*_R@KN*X?2?^1ON_P#KBO\`*"NXH`** M**`"BBB@`KQ_X@7AN]5D&X,$"HN,<8&2./1B?Y5[!7@FHW?V^YDFQM\QV?'7 M&XDXKKP4;R;.3&RM%(U_`MF+W5805+!27.,\;02I./\`:Q_*O9*\U^%5ION9 MIL_=0)C_`'SG/X;/UJ;5?`&IWTTI66,1O*TH0L^,L3R1LQG%/$*,ZEF[6%AW M*%.Z5[DWQ`\8(J/90'+'B5P?N^J#'?\`O=L<=G.2?3%7&K2HQLM2)4JM:5WH9>@ MJG@/23\EVWEP,?:2S*.^*YZ.-IF"J"23@`5ZCGD^GLMG9Q:?$L42A448516E6LJ3VU M9G2HNJM]$9`"%7&?WC[GVG!Z#N<\@<=A7G.GPS>)]2196+M* MXWMD`[>K8SQPHX'X`=JU_B/JYU"_\D$%(1M&"#\S8+?T7'^S6?X4U-M)N#)% M$9I2I6),9P2,EN.>,=!U!/S#N4H.,'+[3"K-2FH_91V/Q/DBM["&%<*?,!10 M,#:B$<=AC<*YCX=V[S:M&RC(0.S>PVE?YL*TAX/U?Q7<&>\(B#`8W,=PQ!YSR'K;P[$8X0>3EF;EF],G`Z=O\2:R=2-.ERWNS54Y5*O-: MR,GXCW\EEIF$./,<1L><[2&8]/7;@^V:Y#X?3V9N)+>X53YR[$9NN2"I4'MO M#>HZ8ZD5VOCW2)=8TXK$"6C82!0,EL`@@?@V??&.]>/U>&BITFB,3)PJIF[? M^"]2L[DQ+"[@G".H^4C.`202%S[GCO7J/A?3'T?3XH'^\HRWL6)8C@GIG'O6 M'X!\6_VK']FN'S,OW">KJ!Z]V'?VYY^8UV-8XBI-^[(WP]."]Z)Y/\2-2ENM M1,+8V0@!`!_?56)/^>WUK0TW2X?%.@^5`BK/`Q.!@;F/G_ZQS73"/-2C MR]#EG+EJRYNIL^&/#&H2:A"S0NBHZR,TBL@PC`]QU]!_3)KUZL[0=:CU^U6= M!C/#+D$JPZCC]/;!Q6C7%7J2G+5;';0IQA'1[A11161J%,E5!;]&V_Y-=?7FOQ5N]]S##C[J%\_P"^<8_#9^M;8:-ZB,<3*U-G#5Z' MI7Q$L-+L8X5BDW)&!@!%4N!SSN[MWQGOBN$TZT^WW,<.=OF.J9ZXW$#->D>) M/`VGV]A-);QA'1=X8LYX7YFZD_P@UV8ATVU&1QX=5$FXG(>)/&EUXARG^KBX M_=@YR1_>;`)Y[=.G&1FH=`\(WFOLI12L9/,K#Y<<]/[W3MWZXK$KU[X?ZL-2 MTU$)R\/[MAQT'W.!VV\9[D&BL_8P]U!17MI^\S0\/>'H/#D'EQ\L>7<]6/\` MAZ#M]1QD\^U>?K.7FST-(1\D<5\0/&# ML[V4!PHXE<'[WJ@QV_O=\\=,YL?##1$$;7CKEB=D9(Z`#YF4^^<>V",\FO/) M)&F8LQ)).23R23W-=;!?:KJMA'96=NR1%=I<;OG/S%_G;"@,>W_`?QKU+P)&T6D0!@0< M,>>."[$'\16%X>^&@M)1+=LK[3Q&N2IZ8+$XS_NX_'&17=22+"I9B``,DG@` M#N:PQ%6,HJ,3?#TI1DY2/&?&ETMYJL[+D`-LY]8P$/ZK74?"FS(6>8J,$JBM MQGC)8>O=?K^%9IC*K7NH]6\`Z)'HUA]IEP'D&\NGO\`=KRN1@[$@!03G:,X'L,DG]:[.ZDU?Q9'';06YAMP%VYW!2H" M@;G;&X#J`![X8C-;_A?X?Q:.RS7!$DJDD`?<7T(R`2??MZ9`-7&HJ5Y2>KZ$ M2INK:,5HNIT6C6[VEE#&XPR1HK#W50#TKD_''CC['NM;5OGZ22#^#_97_:]3 M_#_O?=Z#Q;K?]@V#RC[Y^2/_`'F[]".!D\]<8KSKP)8G5]65Y#NV9F8L3DD= M#GN=Q!YK&A333G+9&U>HTU".[-[PU\/A=K]HU#<6<[O+)(//=S][)ZXR,=^X M'&>(8H8+^9(4V(CE`N2WW/ESD\\D9KV^XN$M(VD22>YK;"SE4DVS'%0C3BDCT'X4V9"SS%1@E45N,\9+#U[K]?PKM=5NFL M;265<$I&SC/3*J3S6'\.;5;?2D89S(SNV?4'9Q^"BM_4;3[?;20YV^8C)GKC M<",US5I7JLZ:,6J2/%-/OD?4$GN0'5I`\NX>+F MTJ46TS#R6/!8_P"K8_T)Z]A][CG/=44E[T3AIN+O&1T/PUT2YTN*629"GF%0 MJMPWR;LDCMUX_P`,9V/%GB1?#5MO`#.QVQJ3W]3WP.^/8<9S6W7C?CG4CJ6J M2GG$9\I<@<;.O3_:R:Y*4?;U;LZZDO84K(/#UA+XNU0><2^3YDS'^ZN..HZ\ M+QTSQP*Z#XIM%$MM"H4%0Q`'!5?E```.,''I_#QWKG_"6K7&DO(;:`S2LH"D M;FVKN^;*KUSQW&*UK#P'J6O3"XO6V!SN?F#C;_`'>,5T3M&I=N MR1SPO*G9*[8?"NW=KV60#Y5CVD^[,I'_`*":].JEI.DP:)`(81A1U/=CW)/K M_P#J'%7:XJU3VD[G;1I^SA8****S-`HHHH`****`"BBB@`HHHH`****`"BBB M@`HHHH`****`"BBB@`HHHH`****`"BBB@`HHHH`****`"BBB@`HHHH`****` M"BBB@`HHHH`****`"BBB@`HHHH`****`"BBB@`HHHH`****`"BBB@`HHHH`* M***`"BBB@`HHHH`****`..^*7_(.C_Z[+_Z`]>6UZE\4O^0='_UV7_T!Z\MK MTL)_#/-Q?\0*]D\#::--TN(<9D'FM@GG?TZ_[.!7C=>Y>'?^0=;?]<8__0!4 M8U^ZB\$O>9HUG>(O^0=<_P#7&3_T`UHT5PIV9W-71\^45K>)O#TOAVY,;`[" M28FZ[E^N!R._^!%9->Q&2DKH\>47%V9[%K]GIVAV;W'V2%]FWY=B+G\=%7$7?NG>Z-XLLKZ\BBCTZ-69U`9=I*\_>XC_AZ_A7$7MJUC,\38)1 MBAQTRIQQ78_#;P]++<"]<$(@8(?[S$;3VZ`$_C]#67X\T9M*U%VY*3$RJ?=C M\PZ#H?T(ITW&-1Q0JBE*FI,YRO6K&[^V^&2V,8MW3U_U:LF?QVYKR6K$-QP,F1D=.W^!-4;BX>[D:1SEG)9C[LHV]A M^WM326YUO_";Z=_T#8?_`!S_`.-58\3:B-4T&*181`GGX1%((P%?)X"X^;/; MW[UQEG9RZA*L42EG8X517=^,M*_L70;>WSDI(-Q_VF61FQP.,GCVI3A"$HVW MN.$YSC*^UCSZNA\`?\AB#_@?_HMZYZNA\`?\AB#_`('_`.BWK:K\#]#&E\:] M3V*O(?B)8P'`90`%;@'OSU_+OGSZM#3M8 MO;6-[:!CMF^5HP`V[<-O`(/)Z<<]/:NVM!SC9,XJ,U"5VC/HHHK0S/0?&'_( MNV?_`&Q_]$M7GU>H:KIIUSPW"(U>7UAAG[K7F M;XE>\GY&WX,O(K#5(9)6"J"P+'H-R,HS^)K>^*MILN89L_>0IC_<.<_CO_2N M&KL]!\/'Q!H,BH`94F+1]!_`F5SCN/ISC-%1*,U._D%)N4'"WF<97:_#.VL[ MV2>.9$D;"L@=0W`)#8R#C[RUQDD;0L58$$'!!X(([&KVAZY/X?G\Z'&<%2&& M00?R/4#O5U8N<&D12DH339W7BG5M.\-7*P_889-R!\X1>I88_P!6?2L;_A-] M._Z!L/\`XY_\:KF-4U*75[AYY<;G.3@8'`P`/H*KQQM,P5022<`#DDGL*B&' MBHZ[ESKRK1>$7AT! M[1>)7'F-[R9#;?O8_A"YSC^*O*Y(VA8JP((."#P01V-&'E%W2[AB(R5F^QM^ M![A+;5H&XDF9W_ M`(0[DM]WG`)]-WZ^]5*E>HI$QJVIN)7KL?A;_P`A&3_KBW_H:5QU=C\+?^0C M)_UQ;_T-*,1_#88?^(CK?%.MW4,\-E98$TWS;F_@4=^01S@^O`Z9(KE+/4[B M>6-DO+E7F9A&TT8\EF/`7:)'`^;CA2!D<#%=+J]^NBZ]#--A8Y83#O)P`P?= MS_XZ.PYSG@USUAHTVCPV%W+NPLI66.?.V(.^`X4@;/7)/WMIKFII*/\`7F=- M1MR_KR.Q\+Z^VM1NDH"S0L4F11\H.3C'+>GKU![8K;KFO""PTZ>3<5(C8*PSD,PVKC'^T17A]='XE\;W/B)?+P(XLYV*N!Z5QX MFG-2)>+;IKS5+AFP")"G'I'\@_1:]MKY^DD:9B MS$DDY)/))//+31X9XB_Y"-S_`-=I/_0S7>?" MJ2(VDRC&\2`MQSM*C;S]0WT_&N:\>>'I=*O'FP3%,Q96Z_,W+*>../]HC M;^O/:N<^('@]&1[V`88N<^=5UOA[XASZ+!Y,B>G3IC'3]7E3=X'-]8C45IF)X9D:+4K7`,>W(CC(PQR"I+`]!SQW/7IUC^*L M$YDA<\Q8*CCH^6K54;E4N:E2)'652,,AR# MCCG!PW<<^O0YKS+Q9X3E\-RY&6B8_(__`+*WO_/J.X&-9WDNGRK+$Q5U.585 MUNH^++GQE;BSCM07)4EE.[&#U`Q\G)ZD\`D'KFKC2E1EI\/4B56-:.OQ=#0^ M$\C%;E-H`8#/\`M9_G71:_\29[ M:26"&(*R.T?F,=WW25R%P.>_.1[&N`DD:9BS$DDY)/))/!6($4I"R9QQUVMDD8P3S[9]J]+\0^' MH/$<'ER<,.4<=5/^'J._UP1Y#JV@7FB.5FC(`.T/@[&[C#=.GX^M:TJL:T.5 M[F56E*C/F6Q[G7(?%"1DTU0"0&E4-CN-KG!_$"N6\/?$*YT6(0R*)D487)VL M.F!NYX'IC\<#%=?J'E^/=)GS8P&9N>BC:PS[ M?ETQ71B:+J)6.?#5E3;N>L7%Q':(7D8(HZLQ"CTZFLKQA=_8M*N&QG*;/3_6 M?)G\-V:YJW\,ZKXK<2:C(8XNJQ*<'_9^7D#[QY;+\8/K5_XA6C6^CJD((2-D M#`'^``J`ARX233=EJ M1_%B1@MLN3@F0D=LC9@_AD_G7'>&0IU*WW$@>:G09YW#'<=_R]^E>D?$'09- M9LU:%=TD1+8YR5(^8`=SP#^''H?):,,U*E8,2G&K<^@ZCFN([?;O8+N(5=Q` MRQZ`9[UY?I?Q!U;:D"(LS`8&5=G;'KM89X]OK6[IO@Z\UF7S]6@/R]>_H>66'Y/B9U1Q'/\**'Q5O]TD-N">`9&'\)W':OXC:WYU'\*[^ M.&>:%CAI`K+TYV;LCZ_-GZ`U-\4=(E9X[M02@7RWP/N_,2"?KNQ^'N*X:SLY M=0E6*)2SL<*HKJIPC.A8Y:DY0KWL>B>._&<<,>_JN[[B<=-VT]LXY[+7"1QM,P5022<`#D MDGL*K#J"C[I.)#4O%>G:1 M+Y4TH5P`2H#-C/KM!Q63X8\)3VUR;Z^??.W*@'[NY<'/;./EP/E`Z9XQYKK, M$]O>2K/_`*S>V\XQDDYR.!P>HXZ5S4Z$*DWJ=-2O.G!.QZIXD\.6WB^W$D3+ MO`/ERJZG!Z5L^&/%L_AIS@;XV^]& M3CGU!YP?YC\,;$6ES_$*_P#M+1>1#@!F'5MN1P2!N;MG&%`&>@!WIJ5&Z?PF M%1QK6:^([_09&FL(&8DDQ(23R22@Y->&R2-,Q9B22AU1NUJ%% M%%(84444`%%%%`!1110`4444`%%%%`!1110`4444`%%%%`!1110`4444`%%% M%`!1110`4444`%%%%`!1110`4444`%%%%`!1110`4444`%%%%`!1110`4444 M`%%%%`!1110`4444`%%%%`!1110`4444`%%%%`!1110`4444`%%%%`%+5='M MM:C$=PN]0=P&67G!'\)'K67_`,(!H_\`SP_\?D_^+KH:*I5)16C)=.,GJCGO M^$`T?_GA_P"/R?\`Q=;MO;I:1K&@PJ`*H]E&!UJ2BB4Y2W81A&.R"BBBI*([ MBWCNT*2*'4]58!AZ]#7-7?PWTJYQM#QX_N-G/UW[_P!*ZFBJC4E'9DRIQENC MCO\`A5NG?\])O^^D_P#B*T-/\!Z58;3Y7F,N?FD.[.?5?N_^._K70T53K5'U M)5&FN@57O]/@U.,QS('4]F'MC(]#SU'-6**S3L:-7.>_X0#1_P#GA_X_)_\` M%U'_`(_)_P#%UT-%'M9]V'LH=D%9&K^%;#6R6FC&\@C>ORMT MQGCKC'&[-:]%3&3B[HJ45):G'?\`"K=._P">DW_?2?\`Q%36OPTTNW;+>9(, M8VNV!]?D"G]:ZNBM/;U.YG["GV*6F:/:Z,FR",(#UQU/7J3R>O>C5='MM:C$ M=PN]0=P&67G!'\)'K5VBL^9WO'_C\G_Q=6-/\(:;I M+RIT#KD'!R.1W!'(J MW14IM%-)G'?\*MT[_GI-_P!])_\`$5K:+X/L-"8/$A+@$>8YRW/_`(Z/3@#C M\:VZ*N5:ISWR>IJEJ?A?3]8??/$&;^\,J3 MT')4C/3OTK5HJ5*2=[E.,6K6.>_X0#1_^>'_`(_)_P#%ULV&GP:9&(X4"*.R MCVQD^IXZGFK%%.4Y2W8HPC'9&9J7ANPU'_C\G_Q=7+[POI^I(B21#;'G M8JY0#=R>$*]<5JT57M)]V3[.'9'/?\(!H_\`SP_\?D_^+JYI7ABPT60R6\>Q MB-I.YVXR#_$Q]*U:*'4FUJV"IP3T2*]_I\&IQF.9`ZGLP]L9'H>>HYKG(_AI MI:2[SYA&2?++?+SVX`;C_>^N:ZNBB-24=F$J<9;H;'&L*A5```P`.``.PIU% M%06%%%%`'#Z3_P`C?=_]<5_E!7<5P^D_\C?=_P#7%?Y05W%`!1110`4444`% M%%%`!1110`4444`%9W_".Z=_S[0_]^T_PK1HIIM":3&QQK"H50``,`#@`#L* M=112&1W%O'=H4D4.IZJP##UZ&J7_``CNG?\`/M#_`-^T_P`*T:*:DT)Q3"BB MBD,I7&C65VY>2&-V/5F16/IU(HM]&LK1P\<,:,.C*BJ?3J!5VBGS/N+E78*; M)&LRE6`((P0>00>QIU%(9G?\([IW_/M#_P!^T_PJW:V4-BNV)%0$YP@"C/KQ M4U%-R;$HI!1112&%%%%`!1110`4444`%%%%`&=_PCNG?\^T/_?M/\*NV]O': M($C4(HZ*H"CUZ"I**;DV)12*EUI5I?-NEBC<@8RZJQQZ00>QIU%(92M]&LK1P\<,:,.C*BJ? M3J!5VBBFVV))(*I7&C65VY>2&-V/5F16/IU(J[10FT#297M-.MK#/DQI'NZ[ M%"YQZX%6***3=QI6&R1K,I5@"",$'D$'L:K6NE6EBVZ**-"1C**JG'IP*MT4 M[L5D-DC692K`$$8(/((/8U6M=*M+%MT44:$C&455./3@5;HHNPL@JO=Z=;7^ M/.C23;TWJ&QGTR*L44D[#:N9W_".Z=_S[0_]^T_PK1HHIMMB22"H[BWCNT*2 M*'4]58!AZ]#4E%(9G?\`".Z=_P`^T/\`W[3_``K1HHIMMB22"BBBD,****`" MBBB@`HHHH`****`"BBB@`HHHH`****`"BBB@`HHHH`****`"BBB@`HHHH`** M**`"BBB@`HHHH`****`"BBB@`HHHH`****`"BBB@`HHHH`****`"BBB@`HHH MH`****`"BBB@`HHHH`****`"BBB@`HHHH`****`"BBB@`HHHH`****`"BBB@ M`HHHH`****`"BBB@`HHHH`****`"BBB@`HHHH`****`"BBB@`HHHH`****`" MBBB@`HHHH`****`"BBB@`HHHH`****`"BBB@`HHHH`****`"BBB@`HHHH`** M**`.'TG_`)&^[_ZXK_*"NXKA])_Y&^[_`.N*_P`H*[B@`HHHH`****`"BBB@ M`HHHH`****`"BBB@`HHHH`****`"BBB@`HHHH`****`"BBB@`HHHH`****`" MBBB@`HHHH`****`"BBB@`HHHH`****`"BBB@`HHHH`****`"BBB@`HHHH`** M**`"BBB@`HHHH`****`"BBB@`HHHH`****`"BBB@`HHHH`****`"BBB@`HHH MH`****`"BBB@`HHHH`****`"BBB@`HHHH`****`"BBB@`HHHH`****`"BBB@ M`HHHH`****`"BBB@`HHHH`****`"BBB@`HHHH`****`"BBB@`HHHH`****`" MBBB@`HHHH`****`"BBB@"CK<5Y/:NMHZQRG&QGZ#YAG^%NV>U)8+Q[M;F$2R+L9_4?+V\K'\([5>_LGQ?\`\_QTSQ3'/&9KJ%HPRF10!D 2KGY@/W([>]=C10`4444`?__9 ` end