EX-99.1 5 seic-33113xex991.htm PRESS RELEASE SEIC-3.31.13-Ex 99.1



Investor Contact:                         Media Contact:
Murray Louis                            Dana Grosser
SEI    SEI
+1 610-676-1932                        +1 610-676-2459
mlouis@seic.com                         dgrosser@seic.com
Pages:        8

FOR IMMEDIATE RELEASE

SEI REPORTS FIRST-QUARTER 2013 FINANCIAL RESULTS

Results Include Gain from Sale of SEI Asset Korea

OAKS, Pa., April 24, 2013 -- SEI Investments Company (NASDAQ:SEIC) today announced financial results for first-quarter 2013. Diluted earnings per share were $.41 in first-quarter 2013 compared to $.28 in first-quarter 2012. First-quarter 2013 includes a gain of $.08 diluted earnings per share from the sale of SEI Asset Korea, of which SEI owned approximately 56.1 percent.
Consolidated Overview
 
For the Three Months
(In thousands, except earnings per share)
 
Ended March 31,
 
 
2013
 
2012
 
%
 
 
 
 
 
 
 
Revenues
 
$
271,879

 
$
237,898

 
14
%
Net Income attributable to SEI
 
71,920

 
49,965

 
44
%
Diluted Earnings Per Share
 

$0.41

 

$0.28

 
46
%
 
 
 
 
 
 
 

"The first quarter of 2013 continued the progress we made during 2012 across all of our businesses. A combination of new client implementations, improved financial markets, and positive sales activity contributed to our operating results during the quarter,” said Alfred P. West, Jr., SEI Chairman and CEO.

"Our results so far this year have been encouraging. SEI will continue to execute against our long-term strategy, including a focus on new client acquisition and development of the products and services necessary for long-term success. As always, we are committed to enhancing shareholder value."




Summary of First-Quarter Results by Business Segment

(In thousands)
 
For the Three Months
 
 
Ended March 31,
 
 
2013
 
2012
 
%
Private Banks:
 
 
 
 
 
 
   Revenues
 

$98,746

 

$87,988

 
12
%
   Expenses
 
96,298

 
87,517

 
10
%
   Operating Profit
 

$2,448

 

$471

 
420
%
   Gain on sale of subsidiary
 
22,112

 
—

 
N/M

   Total Profit
 

$24,560

 

$471

 
N/M

   Operating Margin (A)
 
2
%
 
1
%
 
 
 
 
 
 
 
 
 
Investment Advisors:
 
 
 
 
 
 
   Revenues
 
55,191

 
49,468

 
12
%
   Expenses
 
31,625

 
29,301

 
8
%
   Operating Profit
 
23,566

 
20,167

 
17
%
   Operating Margin
 
43
%
 
41
%
 
 
 
 
 
 
 
 
 
Institutional Investors:
 
 
 
 
 
 
   Revenues
 
63,162

 
53,317

 
18
%
   Expenses
 
31,509

 
28,100

 
12
%
   Operating Profit
 
31,653

 
25,217

 
26
%
   Operating Margin
 
50
%
 
47
%
 
 
 
 
 
 
 
 
 
Investment Managers:
 
 
 
 
 
 
   Revenues
 
53,820

 
46,211

 
16
%
   Expenses
 
35,162

 
30,426

 
16
%
   Operating Profit
 
18,658

 
15,785

 
18
%
   Operating Margin
 
35
%
 
34
%
 
 
 
 
 
 
 
 
 
Investments in New Businesses:
 
 
 
 
 
 
   Revenues
 
960

 
914

 
5
%
   Expenses
 
3,738

 
3,698

 
1
%
   Operating Loss
 
(2,778
)
 
(2,784
)
 
N/M


(A) Percentage determined exclusive of gain on sale of subsidiary.




First-Quarter Business Commentary:

•
Revenues increased in first-quarter 2013 as compared to both first-quarter 2012 and fourth-quarter 2012. Gains were realized in all core business segments and all major product lines, including Asset management, administration, and distribution fees and Information processing and software servicing fees.
•
Net income attributable to SEI increased in first-quarter 2013 as compared to both first-quarter 2012 and fourth-quarter 2012. This was driven by the increase in first-quarter 2013 revenues when compared to both periods. Additionally, the previously disclosed sale of SEI Asset Korea was completed on March 28, 2013 resulting in a gain of $22.1 million, or $.08 diluted earnings per share.
•
Our average assets under management, excluding LSV, increased $20.9 billion, or 17 percent, to $145.0 billion in the first-quarter 2013, as compared to $124.1 billion during the first-quarter 2012, and increased $6.5 billion, or five percent, as compared to $138.5 billion during the fourth-quarter 2012. Ending asset balances for the first-quarter 2013 do not include assets related to SEI Asset Korea (see attached Ending and Average Asset Balances schedules for further details).
•
Sales events, net of client losses, during first-quarter 2013 totaled approximately $19.6 million and are expected to generate net annualized recurring revenues of approximately $16.8 million when contract values are fully realized.
•
Income from LSV increased in first-quarter 2013 to $27.8 million as compared to $27.3 million in first-quarter 2012 due to an increase in assets under management. Our ownership interest in LSV was approximately 39.8 percent in first-quarter 2013 and 41.2 percent in first-quarter 2012.
•
The effective tax rates were 34.9 percent in first-quarter 2013 and 37.2 percent in first-quarter 2012 and 35.0 percent in fourth-quarter 2012. The first-quarter 2013 tax rate was benefited by the reinstatement of the research and development tax credit partially offset by additional foreign taxes caused by the sale of SEI Asset Korea. The increase in the tax rate in the first-quarter 2012 was due to the expiration of the research and development tax credits. The fourth-quarter 2012 tax rate was benefited by state tax planning.
•
In first-quarter 2013, we repurchased 1.3 million shares of our common stock for $36.2 million.

















Earnings Conference Call
A conference call to review earnings is scheduled for 2:00 PM ET on April 24, 2013. 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 291281.

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, 2013, through its subsidiaries and partnerships in which the company has a significant interest, SEI manages or administers $495 billion in mutual fund and pooled or separately managed assets, including $206 billion in assets under management and $289 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)
 
 
For the Three Months Ended March 31,
 
 
2013
 
2012
 
 
 
 
 
Asset management, admin. and distribution fees
 

$198,633

 

$172,954

Information processing and software servicing fees
 
64,532

 
56,200

Transaction–based and trade execution fees
 
8,714

 
8,744

 
 
 
 
 
Total revenues
 
271,879

 
237,898

 
 
 
 
 
Subadvisory, distribution and other asset mgmt costs
 
27,934

 
28,003

Software royalties and other information processing costs
 
7,487

 
6,941

Brokerage commissions
 
6,512

 
6,307

Compensation, benefits and other personnel
 
88,610

 
78,543

Stock-based compensation
 
5,293

 
4,033

Consulting, outsourcing and professional fees
 
31,849

 
26,955

Data processing and computer related
 
12,058

 
11,465

Facilities, supplies and other costs
 
18,148

 
14,508

Amortization
 
8,242

 
7,622

Depreciation
 
5,704

 
5,432

 
 
 
 
 
Total expenses
 
211,837

 
189,809

 
 
 
 
 
Income from operations
 
60,042

 
48,089

 
 
 
 
 
Net gain on investments
 
280

 
3,205

Interest and dividend income
 
1,053

 
1,487

Interest expense
 
(113
)
 
(161
)
Equity in earnings of unconsolidated affiliates
 
27,588

 
27,330

Gain on sale of subsidiary
 
22,112

 
—

 
 
 
 
 
Net income before income taxes
 
110,962

 
79,950

 
 
 
 
 
Income taxes
 
38,692

 
29,715

 
 
 
 
 
Net income
 
72,270

 
50,235

 
 
 
 
 
Less: Net income attributable to the noncontrolling interest
 
(350
)
 
(270
)
 
 
 
 
 
Net income attributable to SEI
 

$71,920

 

$49,965

 
 
 
 
 
Diluted earnings per common share
 

$0.41

 

$0.28

 
 
 
 
 
Shares used to calculate diluted earnings per share
 
176,005

 
177,668

 
 
 
 
 
Basic earnings per common share
 

$0.42

 

$0.28

 
 
 
 
 
Shares used to calculate basic earnings per share
 
172,598

 
176,348

 
 
 
 
 






SEI INVESTMENTS COMPANY
CONDENSED BALANCE SHEETS
(In thousands)
(Unaudited)

 
 
March 31,
 
December 31,
 
 
2013
 
2012
Assets
 
 
 
 
 
 
 
 
 
Cash and short-term investments
 

$452,099

 

$452,247

Restricted cash
 
5,500

 
6,000

Receivables, net
 
247,137

 
202,818

Securities owned
 
21,107

 
20,088

Other current assets
 
21,705

 
20,251

 
 
 
 
 
     Total current assets
 
747,548

 
701,404

 
 
 
 
 
Property and equipment, net
 
123,153

 
127,581

Marketable securities
 
78,148

 
81,778

Capitalized software, net
 
305,352

 
307,490

Investment in unconsolidated affiliates
 
77,165

 
77,398

Other assets, net
 
11,244

 
14,173

 
 
 
 
 
     Total assets
 

$1,342,610

 

$1,309,824

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 
 
 
 
Current liabilities
 

$148,727

 

$152,005

Deferred income taxes
 
85,386

 
93,458

Other Long-term liabilities
 
7,400

 
7,032

 
 
 
 
 
Total SEI Investments Company shareholders’ equity
 
1,101,097

 
1,038,180

Noncontrolling interest
 
—

 
19,149

Total Equity
 
1,101,097

 
1,057,329

 
 
 
 
 
     Total liabilities and equity
 

$1,342,610

 

$1,309,824






SEI INVESTMENTS COMPANY
ENDING ASSET BALANCES
(In millions)
(Unaudited)
 
 
Mar. 31,
 
Jun. 30,
 
Sept. 30,
 
Dec. 31,
 
Mar. 31,
 
 
2012
 
2012
 
2012
 
2012
 
2013
Private Banks:
 
 
 
 
 
 
 
 
 
 
Equity/Fixed Income prgms.
 

$17,180

 

$16,848

 

$17,960

 

$18,862

 

$12,446

Collective Trust Fund prgms.
 
435

 
335

 
147

 
11

 
9

Liquidity funds
 
5,549

 
5,063

 
5,342

 
6,008

 
5,143

Total assets under mgmnt.
 

$23,164

 

$22,246

 

$23,449

 

$24,881

 

$17,598

 
 
 
 
 
 
 
 
 
 
 
Client assets under admin.
 
10,916

 
10,719

 
11,611

 
12,178

 
12,970

Total assets
 

$34,080

 

$32,965

 

$35,060

 

$37,059

 

$30,568

 
 
 
 
 
 
 
 
 
 
 
Investment Advisors:
 
 
 
 
 
 
 
 
 
 
Equity/Fixed Income prgms.
 

$29,722

 

$29,153

 

$30,864

 

$31,220

 

$34,166

Collective Trust Fund prgms.
 
1,199

 
705

 
370

 
14

 
15

Liquidity funds
 
1,643

 
1,880

 
1,868

 
2,514

 
2,094

Total assets under mgmnt.
 

$32,564

 

$31,738

 

$33,102

 

$33,748

 

$36,275

 
 
 
 
 
 
 
 
 
 
 
Institutional Investors:
 
 
 
 
 
 
 
 
 
 
Equity/Fixed Income prgms.
 

$54,537

 

$55,548

 

$59,852

 

$62,160

 

$64,214

Collective Trust Fund prgms.
 
424

 
415

 
153

 
102

 
101

Liquidity funds
 
3,725

 
2,958

 
3,272

 
2,454

 
2,810

Total assets under mgmnt.
 

$58,686

 

$58,921

 

$63,277

 

$64,716

 

$67,125

 
 
 
 
 
 
 
 
 
 
 
Investment Managers:
 
 
 
 
 
 
 
 
 
 
Equity/Fixed Income prgms.
 

$62

 

$61

 

$65

 

$67

 

$73

Collective Trust Fund prgms.
 
12,781

 
13,004

 
15,433

 
16,197

 
17,656

Liquidity funds
 
147

 
226

 
396

 
408

 
522

Total assets under mgmnt.
 

$12,990

 

$13,291

 

$15,894

 

$16,672

 

$18,251

 
 
 
 
 
 
 
 
 
 
 
Client assets under admin. (A)
 
228,327

 
231,549

 
240,965

 
244,671

 
275,632

Total assets
 

$241,317

 

$244,840

 

$256,859

 

$261,343

 

$293,883

 
 
 
 
 
 
 
 
 
 
 
Investments in New Businesses:
 
 
 
 
 
 
 
 
 
 
Equity/Fixed Income prgms.
 

$568

 

$551

 

$534

 

$513

 

$552

Liquidity funds
 
34

 
30

 
29

 
43

 
42

Total assets under mgmnt.
 

$602

 

$581

 

$563

 

$556

 

$594

 
 
 
 
 
 
 
 
 
 
 
LSV Asset Management:
 
 
 
 
 
 
 
 
 
 
Equity/Fixed Income prgms.
 

$60,607

 

$54,922

 

$58,886

 

$60,947

 

$66,311

 
 
 
 
 
 
 
 
 
 
 
Total:
 
 
 
 
 
 
 
 
 
 
Equity/Fixed Income prgms (B) (D)
 

$162,676

 

$157,083

 

$168,161

 

$173,769

 

$177,762

Collective Trust Fund prgms.
 
14,839

 
14,459

 
16,103

 
16,324

 
17,781

Liquidity funds
 
11,098

 
10,157

 
10,907

 
11,427

 
10,611

Total assets under mgmnt.
 

$188,613

 

$181,699

 

$195,171

 

$201,520

 

$206,154

 
 
 
 
 
 
 
 
 
 
 
Client assets under admin. (C)
 
239,243

 
242,268

 
252,576

 
256,849

 
288,602

Total assets
 

$427,856

 

$423,967

 

$447,747

 

$458,369

 

$494,756

(A)
Client assets under administration in the Investment Managers segment include $54.1 billion of assets balances that require limited services and therefore are at fee levels below our normal full service assets (as of March 31, 2013).
(B)
Equity/Fixed Income programs include $3.3 billion of assets invested in various asset allocation funds at March 31, 2013.
(C)
In addition to the numbers presented, SEI also administers an additional $4.9 billion in Funds of Funds assets (as of
March 31, 2013) on which SEI does not earn an administration fee.
(D)
Equity/Fixed Income programs in the Private Banks segment for 2012 included assets related to SEI Asset Korea which was sold in first-quarter 2013. Assets for SEI Asset Korea for the four quarters of 2012 were $6.6 billion, $6.3 billion. $6.6 billion and $7.0 billion respectively.



SEI INVESTMENTS COMPANY
AVERAGE ASSET BALANCES
(In millions)
(Unaudited)
 
 
 
1st Qtr.
 
2nd Qtr.
 
3rd Qtr.
 
4th Qtr.
 
1st Qtr.
 
 
 
2012
 
2012
 
2012
 
2012
 
2013
Private Banks:
 
 
 
 
 
 
 
 
 
 
 
Equity/Fixed Income prgms.
 
 

$17,116

 

$16,794

 

$17,527

 

$18,301

 

$19,197

Collective Trust Fund prgms.
 
 
436

 
396

 
230

 
66

 
11

Liquidity funds
 
 
5,581

 
5,115

 
5,401

 
5,229

 
5,556

Total assets under mgmnt.
 
 

$23,133

 

$22,305

 

$23,158

 

$23,596

 

$24,764

 
 
 
 
 
 
 
 
 
 
 
 
Client assets under admin.
 
 
10,211

 
10,631

 
10,867

 
11,783

 
12,860

Total assets
 
 

$33,344

 

$32,936

 

$34,025

 

$35,379

 

$37,624

 
 
 
 
 
 
 
 
 
 
 
 
Investment Advisors:
 
 
 
 
 
 
 
 
 
 
 
Equity/Fixed Income prgms.
 
 

$28,426

 

$29,103

 

$30,032

 

$30,881

 

$33,189

Collective Trust Fund prgms.
 
 
1,238

 
984

 
532

 
158

 
14

Liquidity funds
 
 
2,015

 
1,806

 
1,886

 
2,176

 
2,085

Total assets under mgmnt.
 
 

$31,679

 

$31,893

 

$32,450

 

$33,215

 

$35,288

 
 
 
 
 
 
 
 
 
 
 
 
Institutional Investors:
 
 
 
 
 
 
 
 
 
 
 
Equity/Fixed Income prgms.
 
 

$52,270

 

$54,998

 

$57,763

 

$61,304

 

$63,642

Collective Trust Fund prgms.
 
 
427

 
418

 
284

 
120

 
101

Liquidity funds
 
 
3,765

 
3,147

 
3,253

 
3,493

 
2,960

Total assets under mgmnt.
 
 

$56,462

 

$58,563

 

$61,300

 

$64,917

 

$66,703

 
 
 
 
 
 
 
 
 
 
 
 
Investment Managers:
 
 
 
 
 
 
 
 
 
 
 
Equity/Fixed Income prgms.
 
 

$58

 

$63

 

$62

 

$68

 

$68

Collective Trust Fund prgms.
 
 
11,983

 
12,991

 
14,797

 
15,719

 
17,129

Liquidity funds
 
 
190

 
235

 
287

 
395

 
511

Total assets under mgmnt.
 
 

$12,231

 

$13,289

 

$15,146

 

$16,182

 

$17,708

 
 
 
 
 
 
 
 
 
 
 
 
Client assets under admin.
 
 
224,547

 
229,873

 
237,155

 
240,520

 
263,054

Total assets
 
 

$236,778

 

$243,162

 

$252,301

 

$256,702

 

$280,762

 
 
 
 
 
 
 
 
 
 
 
 
Investments in New Businesses:
 
 
 
 
 
 
 
 
 
 
 
Equity/Fixed Income prgms.
 
 

$549

 

$550

 

$530

 

$518

 

$542

Liquidity funds
 
 
39

 
33

 
35

 
33

 
38

Total assets under mgmnt.
 
 

$588

 

$583

 

$565

 

$551

 

$580

 
 
 
 
 
 
 
 
 
 
 
 
LSV Asset Management:
 
 
 
 
 
 
 
 
 
 
 
Equity/Fixed Income prgms.
 
 

$59,200

 

$55,994

 

$57,164

 

$59,383

 

$64,448

 
 
 
 
 
 
 
 
 
 
 
 
Total:
 
 
 
 
 
 
 
 
 
 
 
Equity/Fixed Income prgms (A)
 
 

$157,619

 

$157,502

 

$163,078

 

$170,455

 

$181,086

Collective Trust Fund prgms.
 
 
14,084

 
14,789

 
15,843

 
16,063

 
17,255

Liquidity funds
 
 
11,590

 
10,336

 
10,862

 
11,326

 
11,150

Total assets under mgmnt.
 
 

$183,293

 

$182,627

 

$189,783

 

$197,844

 

$209,491

 
 
 
 
 
 
 
 
 
 
 
 
Client assets under admin.
 
 
234,758

 
240,504

 
248,022

 
252,303

 
275,914

Total assets
 
 

$418,051

 

$423,131

 

$437,805

 

$450,147

 

$485,405

(A)
Equity/Fixed Income programs in the Private Banks segment for 2012 and 2013 included average assets related to SEI Asset Korea which was sold in first-quarter 2013. Average assets for SEI Asset Korea for the four quarters of 2012 were $6.8 billion, $6.4 billion, $6.5 billion and $6.8 billion respectively. Average assets for the first-quarter 2013 were $7.0 billion.