Profits for Alex. Brown and T. Rowe Price soar Gains tied to strong investment market

January 31, 1992

Two Baltimore-based financial service companies saw their profits soar in the fourth quarter of 1991 and the full year, thanks to a strong investment market.

Lower interest rates on certificates of deposits and renewed interest in small and medium-sized companies boosted market activity and helped brokerage companies, said R. Bentley Offutt, president of Offutt Securities Inc. in Baltimore.

Individual investors and money managers increased their participation in the market, he said, adding, "All of these things suggest that brokerage firms are doing very well."

T. Rowe Price Associates Inc.'s fourth-quarter profits more than doubled, to $8.4 million, or 56 cents a share, from $4 million, or 27 cents a share, a year earlier.

Revenues rose to $55.9 million compared with $40 million a year earlier. during the same period in 1990.

Company President George J. Collins attributed the earnings to record levels of managed assets, Assets in mutual funds rose to $21.5 billion by the end of the year, up $4.1 billion from the previous year. Total assets under management increased to $35.6 billion from $29.4 billion at the end of 1990.

For the year, profits increased 45 percent to $30.4 million, or $2.04 a share on revenues of $205 million. In 1990, profits were $20.9 million, or $1.42 a share.

Alex. Brown Inc. saw its fourth-quarter earnings quadruple and reported record revenues and earnings for the year.

"The firm clearly benefited from the year's extraordinary market strength, which prompted sharp increases in trading volume on the major exchanges and strong demand for public offerings," said A.B. Krongard, Alex. Brown's chief executive.

For the quarter, profits were $19.1 million, or $1.13 a share fully diluted, compared with $3.8 million, or 26 cents, in the last quarter of 1990. Fully diluted earnings count the common stock and other securities convertible into common stock.

Revenues increased to $126.1 million from $67.9 million a year earlier.

For 1991, the firm had record earnings of $52 million, or $3.12 a share fully diluted, against $7.8 million, or 50 cents a share in 1990.

Alex. Brown's fourth quarter was even better than some analysts had predicted.

Richard L. Hanley, head of Richard Hanley Associates in New York, said he expected the company to report earnings of 75 cents to $1 a share. He said the company, a leading underwriter of initial public offerings, benefited from a strong market in companies selling stock.

Alex. Brown

+ Three months ended 12/31/91

.. .. Revenue.. .. .. .. Net.. .. .. .. .. Share

'91..126,176,000.. .. ..19,108,000.. .. .1.13

'90.. .67,981,000.. .. ..3,816,000.. .. .0.26

% change.. .+85.6.. .. .. .. +400.1.. .. . +334

Twelve months ended 12/31/91

.. .. Revenue.. .. .. .. Net.. .. .. .. .. Share

'91.. 410,580,000.. .. ..51,952,000.. .. ..3.12

'90..271,702,000.. .. ..7,761,000.. .. ..0.50

% change.. .. +51.. .. .. .. . +569.. .. .. +524

T.Rowe Price

+ Three months ended 12/31/91

.. .. Revenue.. .. .. .. Net.. .. .. .. .. Share

'91..55,934,000.. .. ..8,425,000.. .. .. .0.56

'90.. 40,053,000.. .. ..3,964,000.. .. .. .0.27

% change.. +39.6.. .. .. .. +112.5.. .. . +107.4

Twelve months ended 12/31/91

.. ..Revenue.. .. .. .. Net.. .. .. .. .. Share

'91..205,206,000.. .. ..30,437,000.. .. .. 2.04

'90..170,031,000.. .. ..20,921,000.. .. ..1.42

% change.. +20.7.. .. . +45.5.. .. .. .. . +44

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