WASHINGTON (dpa-AFX) - Asset manager Legg Mason Inc. (LM), Friday reported a lower third-quarter profit as reduced assets under management and performance fees pulled down revenues by 13 percent from last year. Quarterly earnings and revenues missed Street analysts estimates, dragging down Legg Mason shares down by about 6 percent in morning trade on the New York Stock Exchange. Baltimore, Maryland-based Legg Mason reported third-quarter net income of $28.1 million or $0.20 per share, down from $61.6 million or $0.41 per share last year. Results for the quarter include $42.3 million in transition-related costs, compared to $24 million or $0.10 per share a year ago. Excluding items, adjusted earnings for the quarter was $76.8 million or $0.55 per share, compared to $110 million or $0.73 per share in the prior year. On average, 16 analysts polled by Thomson Reuters expected earnings of $0.25 per share for the quarter. Analysts' estimates typically exclude special items. Operating revenues for the quarter declined 13 percent to $627 million from $722 million last year. Results were impacted by a 7 percent drop in average Assets Under Management (AUM) and a $28.5 million reduction in performance fees. Thirteen analysts had a consensus revenue estimate of $655.7 million for the quarter. CEO Mark Fetting decribed the quarter as challenging due to the market turbulence that impacted Assets Under Management and revenues. Operating margin for the quarter decreased to 9.5 percent from 13.4 percent last year, and adjusted margin dropped to 21.7 percent from 24.3 percent. As at December 31, 2011, Legg Mason's Assets Under Management declined 7 percent to $627 billion from $671.8 billion as at December, 31, 2010. Legg Mason also declared a quarterly cash dividend on its common stock of $0.08 per share, payable on April 16 to shareholders of record on March 15. LM is trading at $25.77, down $1.55 or 5.67%, on a volume of about 2.4 million shares on the NYSE.
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