EX-99.1 5 d325271dex991.htm PRESS RELEASE Press Release

Exhibit 99.1

NEWS FROM SEI

 

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 2012 FINANCIAL RESULTS

OAKS, Pa., May 2, 2012 — SEI Investments Company (NASDAQ:SEIC) today announced financial results for first-quarter 2012. Diluted earnings per share were $.28 in first-quarter 2012 compared to $.31 in first-quarter 2011.

 

Consolidated Overview    For the Three Months  
(In thousands, except earnings per share)    Ended March 31,  
     2012      2011      %  

Revenues

    $ 237,898       $ 232,493         2 % 

Net Income attributable to SEI

      49,965         57,728         (13 %) 

Diluted Earnings Per Share

    $ 0.28       $ 0.31         (10 %) 

“Strong new sales and improving revenues over fourth-quarter 2011 drove first-quarter 2012 results,” said Alfred P. West, Jr., SEI Chairman and CEO.

“Despite uncertainty in the financial markets, we are seeing buyers return to our markets. During 2012, we will continue to focus on sales results, improving productivity and service quality, and increasing profits. We are confident that the investments we are making will enable us to significantly increase shareholder value.”

 

1

Summary of First-Quarter Results by Business Segment

 

(In thousands)    For the Three Month Period  
     Ended March 31,  
     2012     2011     %  

Private Banks:

       

Revenues

    $ 87,988      $ 86,709        1 % 

Expenses

      87,517        82,403        6 % 
  

 

 

    

 

 

    

Operating Profit

    $ 471      $ 4,306        (89 %) 

Operating Margin

      1 %      5 %   

Investment Advisors:

       

Revenues

      49,468        48,108        3 % 

Expenses

      29,301        27,040        8 % 
  

 

 

    

 

 

    

Operating Profit

      20,167        21,068        (4 %) 

Operating Margin

      41 %      44 %   

Institutional Investors:

       

Revenues

      53,317        53,185        —     

Expenses

      28,100        26,953        4 % 
  

 

 

    

 

 

    

Operating Profit

      25,217        26,232        (4 %) 

Operating Margin

      47 %      49 %   

Investment Managers:

       

Revenues

      46,211        43,441        6 % 

Expenses

      30,426        27,999        9 % 
  

 

 

    

 

 

    

Operating Profit

      15,785        15,442        2 % 

Operating Margin

      34 %      36 %   

Investments in New Businesses:

       

Revenues

      914        1,050        (13 %) 

Expenses

      3,698        3,125        18 % 
  

 

 

    

 

 

    

Operating Loss

      (2,784 )      (2,075 )      34 % 

Operating Margin

      N/A        N/A     

Totals:

       

Revenues

    $ 237,898      $ 232,493        2 % 

Expenses

      179,042        167,520        7 % 

Corporate overhead expenses

      11,082        10,648        4 % 

Noncontrolling interest reflected in segments

      (315 )      (272 )      N/A   
  

 

 

    

 

 

    

Income from operations

    $ 48,089      $ 54,597        (12 %) 

 

2

First-Quarter Business Commentary:

 

  •  

Revenues increased in first-quarter 2012 as compared to first-quarter 2011 and to fourth-quarter 2011 due to an increase in Asset management, administrative, and distribution fee revenues from improved cash-flows and market appreciation in first-quarter 2012. Our average assets under management, excluding LSV, increased $9.6 billion, or eight percent, to $124.1 billion in the first-quarter 2012 as compared to $114.5 billion during the first-quarter 2011 (See attached Ending and Average Asset Balances schedules for further details).

 

  •  

Sales events, net of client losses, during first-quarter 2012 totaled approximately $26.1 million and are expected to generate net annualized recurring revenues of approximately $23.5 million when contract values are fully realized. These sales events resulted in an increase in sales compensation expense when compared to first-quarter 2011 of $1.8 million.

 

  •  

Total consolidated expenses in first-quarter 2012 include approximately an additional $1.8 million in fees for other asset management distribution costs and employee severance costs.

 

  •  

Net income attributable to SEI includes gains from SIV securities of $2.9 million in first-quarter 2012 compared to gains of $6.9 million in first-quarter 2011.

 

  •  

The effective tax rates were 37.2 percent in the first-quarter 2012, 37.1 percent in the first-quarter 2011 and 34.7 percent in the fourth-quarter 2011. The increase in the tax rate in the first-quarter 2012 as compared to the fourth-quarter 2011 was due to the expiration of the research and development tax credit in first-quarter 2012 and tax planning strategies which benefited the tax rate in fourth-quarter 2011.

 

  •  

In the first-quarter 2012, SEI purchased 1.8 million shares of its common stock for $37.7 million.

 

3

Earnings Conference Call

A conference call to review earnings is scheduled for 2:00 PM ET on May 2, 2012. 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) 1-877-777-1972; (International) 612-332-0636, access code 245414.

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, 2012, through its subsidiaries and partnerships in which the company has a significant interest, SEI manages or administers $428 billion in mutual fund and pooled or separately managed assets, including $189 billion in assets under management and $239 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.

 

4

SEI INVESTMENTS COMPANY

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

(Unaudited)

 

     Three Months Ended March 31,  
     2012     2011  

Asset management, admin. and distribution fees

    $ 172,954      $ 167,504   

Information processing and software servicing fees

      56,200        55,824   

Transaction–based and trade execution fees

      8,744        9,165   
  

 

 

    

 

 

  

Total revenues

      237,898        232,493   

Subadvisory, distribution and other asset mgmt costs

      28,467        26,296   

Software royalties and other information processing costs

      6,477        7,017   

Brokerage commissions

      6,307        6,581   

Compensation, benefits and other personnel

      78,543        71,025   

Stock-based compensation

      4,033        3,732   

Consulting, outsourcing and professional fees

      26,955        25,998   

Data processing and computer related

      11,465        11,303   

Facilities, supplies and other costs

      14,508        14,102   

Amortization

      7,622        6,231   

Depreciation

      5,432        5,611   
  

 

 

    

 

 

  

Total expenses

      189,809        177,896   

Income from operations

      48,089        54,597   

Net gain on investments

      3,205        7,278   

Interest and dividend income

      1,487        1,544   

Interest expense

      (161 )      (204 ) 

Equity in earnings of unconsolidated affiliate

      27,330        28,949   
  

 

 

    

 

 

  

Net income before income taxes

      79,950        92,164   

Income taxes

      29,715        34,124   
  

 

 

    

 

 

  

Net income

      50,235        58,040   
  

 

 

    

 

 

  

Less: Net income attributable to the noncontrolling interest

      (270 )      (312 ) 
  

 

 

    

 

 

  

Net income attributable to SEI

    $ 49,965      $ 57,728   
  

 

 

    

 

 

  

Diluted earnings per common share

    $ 0.28      $ 0.31   
  

 

 

    

 

 

  

Shares used to calculate diluted earnings per common share

      177,668        188,495   
  

 

 

    

 

 

  

Basic earnings per common share

    $ 0.28      $ 0.31   
  

 

 

    

 

 

  

Shares used to calculate basic earnings per common share

      176,348        185,787   
  

 

 

    

 

 

  

 

5

SEI INVESTMENTS COMPANY

CONDENSED BALANCE SHEETS

(In thousands)

(Unaudited)

 

     March 31,
2012		      December 31,
2011		  

Assets

      

Cash and short-term investments

    $ 388,127       $ 420,986   

Restricted cash

      6,000         6,000   

Receivables, net

      182,093         167,909   

Securities owned

      21,053         20,949   

Other current assets

      20,066         19,107   
  

 

 

     

 

 

  

Total current assets

      617,339         634,951   

Property and equipment, net

      136,431         129,548   

Marketable securities

      140,675         139,333   

Capitalized software, net

      311,229         309,133   

Investment in unconsolidated affiliate

      66,691         60,954   

Other assets, net

      21,261         20,640   
  

 

 

     

 

 

  

Total assets

    $ 1,293,626       $ 1,294,559   
  

 

 

     

 

 

  

Liabilities

      

Current liabilities

    $ 118,877       $ 151,073   

Deferred income taxes

      92,477         93,751   

Other Long-term liabilities

      10,832         8,276   

Total SEI Investments Company shareholders’ equity

      1,054,544         1,025,316   

Noncontrolling interest

      16,896         16,143   
  

 

 

     

 

 

  

Total Equity

      1,071,440         1,041,459   

Total liabilities and equity

    $ 1,293,626       $ 1,294,559   
  

 

 

     

 

 

  

 

6

SEI INVESTMENTS COMPANY

ENDING ASSET BALANCES

(In millions)

(Unaudited)

 

     Mar. 31,
2011		      Jun. 30,
2011		      Sept. 30,
2011		      Dec. 31,
2011		      Mar. 31,
2012		  

Private Banks:

               

Equity/Fixed Income prgms.

    $ 14,809       $ 16,720       $ 15,442       $ 16,435       $ 17,180   

Collective Trust Fund prgms.

      576         504         476         450         435   

Liquidity funds

      5,217         4,918         5,529         5,553         5,549   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total assets under mgmt.

    $ 20,602       $ 22,142       $ 21,447       $ 22,438       $ 23,164   

Client assets under admin.

      11,227         10,994         9,845         10,355         10,916   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total assets

    $ 31,829       $ 33,136       $ 31,292       $ 32,793       $ 34,080   

Investment Advisors:

               

Equity/Fixed Income prgms.

    $ 28,296       $ 28,410       $ 24,757       $ 26,639       $ 29,722   

Collective Trust Fund prgms.

      1,618         1,499         1,392         1,298         1,199   

Liquidity funds

      1,551         1,651         2,653         2,505         1,643   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total assets under mgmt.

    $ 31,465       $ 31,560       $ 28,802       $ 30,442       $ 32,564   

Institutional Investors:

               

Equity/Fixed Income prgms.

    $ 51,287       $ 51,180       $ 46,259       $ 49,051       $ 54,537   

Collective Trust Fund prgms.

      608         482         510         492         424   

Liquidity funds

      3,202         3,146         3,356         3,888         3,725   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total assets under mgmt.

    $ 55,097       $ 54,808       $ 50,125       $ 53,431       $ 58,686   

Investment Managers:

               

Equity/Fixed Income prgms.

    $ 37       $ 50       $ 64       $ 57       $ 62   

Collective Trust Fund prgms.

      8,841         10,372         10,896         11,255         12,781   

Liquidity funds

      139         179         195         152         147   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total assets under mgmt.

    $ 9,017       $ 10,601       $ 11,155       $ 11,464       $ 12,990   

Client assets under admin. (A)

      238,335         238,432         223,620         221,198         228,327   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total assets

    $ 247,352       $ 249,033       $ 234,775       $ 232,662       $ 241,317   

Investments in New Businesses:

               

Equity/Fixed Income prgms.

    $ 598       $ 558       $ 490       $ 515       $ 568   

Liquidity funds

      56         41         41         37         34   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total assets under mgmt.

    $ 654       $ 599       $ 531       $ 552       $ 602   

LSV Asset Management

               

Equity/Fixed Income prgms.

    $ 62,370       $ 60,626       $ 49,444       $ 53,712       $ 60,607   

Consolidated:

               

Equity/Fixed Income prgms (B)

    $ 157,397       $ 157,544       $ 136,456       $ 146,409       $ 162,676   

Collective Trust Fund prgms.

      11,643         12,857         13,274         13,495         14,839   

Liquidity funds

      10,165         9,935         11,774         12,135         11,098   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total assets under mgmt.

    $ 179,205       $ 180,336       $ 161,504       $ 172,039       $ 188,613   

Client assets under admin. (C)

      249,562         249,426         233,465         231,553         239,243   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total assets

    $ 428,767       $ 429,762       $ 394,969       $ 403,592       $ 427,856   

 

(A) Client assets under administration in the Investment Managers segment include $38.5 billion of assets balances that require limited services and therefore are at fee levels below our normal full service assets (as of March 31, 2012).
(B) Equity/Fixed Income programs include $2.6 billion of assets invested in various asset allocation funds at March 31, 2012.
(C) In addition to the numbers presented, SEI also administers an additional $4.6 billion in Funds of Funds assets (as of March 31, 2012) on which SEI does not earn an administration fee.

 

7

SEI INVESTMENTS COMPANY

AVERAGE ASSET BALANCES

(In millions)

(Unaudited)

 

     1st Qtr
2011		      2nd Qtr
2011		      3rd Qtr
2011		      4th Qtr
2011		      1st Qtr
2012		  

Private Banks:

               

Equity/Fixed Income prgms.

    $ 14,170       $ 16,176       $ 16,592       $ 16,624       $ 17,116   

Collective Trust Fund prgms.

      593         543         505         464         436   

Liquidity funds

      5,058         4,909         5,210         5,401         5,581   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total assets under mgmt.

    $ 19,821       $ 21,628       $ 22,307       $ 22,489       $ 23,133   

Client assets under admin.

      10,921         11,114         10,364         10,290         10,211   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total assets

    $ 30,742       $ 32,742       $ 32,671       $ 32,779       $ 33,344   

Investment Advisors:

               

Equity/Fixed Income prgms.

    $ 27,841       $ 28,502       $ 26,658       $ 26,094       $ 28,426   

Collective Trust Fund prgms.

      1,687         1,544         1,442         1,314         1,238   

Liquidity funds

      1,580         1,576         2,224         2,499         2,015   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total assets under mgmt.

    $ 31,108       $ 31,622       $ 30,324       $ 29,907       $ 31,679   

Institutional Investors:

               

Equity/Fixed Income prgms.

    $ 50,392       $ 51,567       $ 49,115       $ 48,504       $ 52,270   

Collective Trust Fund prgms.

      608         554         505         500         427   

Liquidity funds

      3,418         3,515         3,416         3,461         3,765   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total assets under mgmt.

    $ 54,418       $ 55,636       $ 53,036       $ 52,465       $ 56,462   

Investment Managers:

               

Equity/Fixed Income prgms.

    $ 1       $ 38       $ 52       $ 65       $ 58   

Collective Trust Fund prgms.

      8,288         9,560         11,292         10,773         11,983   

Liquidity funds

      210         165         200         219         190   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total assets under mgmt.

    $ 8,499       $ 9,763       $ 11,544       $ 11,057       $ 12,231   

Client assets under admin.

      237,376         241,423         236,953         224,633         224,547   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total assets

    $ 245,875       $ 251,186       $ 248,497       $ 235,690       $ 236,778   

Investments in New Businesses:

               

Equity/Fixed Income prgms.

    $ 579       $ 561       $ 525       $ 515       $ 549   

Liquidity funds

      61         42         42         42         39   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total assets under mgmt.

    $ 640       $ 603       $ 567       $ 557       $ 588   

LSV Asset Management

               

Equity/Fixed Income prgms.

    $ 62,212       $ 63,000       $ 54,679       $ 54,021       $ 59,200   

Consolidated:

               

Equity/Fixed Income prgms

    $ 155,195       $ 159,844       $ 147,621       $ 145,823       $ 157,619   

Collective Trust Fund prgms.

      11,176         12,201         13,744         13,051         14,084   

Liquidity funds

      10,327         10,207         11,092         11,622         11,590   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total assets under mgmt.

    $ 176,698       $ 182,252       $ 172,457       $ 170,496       $ 183,293   

Client assets under admin.

      248,297         252,537         247,317         234,923         234,758   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total assets

    $ 424,995       $ 434,789       $ 419,774       $ 405,419       $ 418,051   

 

8