) second-quarter 2013 adjusted earnings were 50 cents per share,
missing the Zacks Consensus Estimate by a penny. Further, this
was in line with the prior-quarter figure.
AMERIPRISE FINL (AMP): Free Stock Analysis
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INVESCO LTD (IVZ): Free Stock Analysis Report
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A slight rise in revenues and a fall in expenses were the
positives for the quarter. Further, the company's balance sheet
position remained stable. However, a marginal fall in assets
under management (AUM) was the headwind.
On a GAAP basis, net income in the reported quarter was $202.6
million or 45 cents per share, down from $222.2 million or 49
cents in the prior quarter.
Adjusted net revenue nudged up 0.3% sequentially to $790.3
million in the reported quarter, driven by an increase in
investment management fees, partially offset by a fall in
performance fee revenues. However, net revenue was significantly
below the Zacks Consensus Estimate of $1.2 billion.
Adjusted operating expenses dipped 0.4% from the prior quarter to
$479.7 million. The marginal fall was primarily due to lower
employee compensation expenses, partially offset by increases in
general and administrative expenses as well as marketing costs.
Adjusted operating margin for the quarter was 39.3%, up from
38.9% in the prior quarter.
As of Jun 30, 2013, AUM dropped 0.3% sequentially to $705.6
billion, reflecting net market losses and unfavorable foreign
exchange rate changes. Average AUM for the reported quarter was
$719.8 billion, up 4.1% from $691.6 billion in the prior quarter.
Long-term net inflows were $1.4 billion, compared with $14.3
billion in the previous quarter.
As of Jun 30, 2013, cash and cash equivalents were $916.2
million, compared with $835.5 million as of Dec 31, 2012. Total
debt was $1,445.6 million as of Jun 30, 2013, against $1,186.0
million as of Dec 31, 2012.
Additionally, credit facility balance reached $846.0 million as
of Jun 30, 2013, compared with $586.5 million as of Dec 31, 2012.
Share Repurchase Update
In the reported quarter, Invesco repurchased 2.2 million shares
worth $75.5 million.
Along with the earnings release, the company declared
second-quarter dividend of 22.5 cents per share. The dividend
will be paid on Sep 6 to shareholders of record as of Aug 21.
During the reported quarter, Invesco announced that it had
entered into a definitive agreement to divest Atlantic Trust
Private Wealth Management to
Canadian Imperial Bank of Commerce
) for $210 million. The deal, expected to close in the second
half of 2013, is still subject to regulatory approval.
Performance of Other Investment Management
Second-quarter earnings per share of
Ameriprise Financial Inc.
) surpassed the Zacks Consensus Estimate. The improved results
for both the companies were primarily attributable to increased
top line, partially offset by higher operating expenses.
Invesco's long-term investment performance was boosted by an
uptrend in the global equity markets, which is expected to drive
the company's operating results as well. Moreover, the operating
leverage will likely improve over the long term due to the
company's cost-control initiatives.
Invesco is well positioned to benefit from improved global
investment flows owing to its broad diversification.
Additionally, meaningful capital deployment activities will
enhance shareholders' confidence in the stock. However, the
volatile U.S. dollar and rising competition remain matters of
Currently, Invesco carries a Zacks Rank #4 (Sell).