Investment firms' profits rose during quarter, year

EARNINGS

January 29, 1993|By David Conn | David Conn,Staff Writer

Last year might not have been a bonanza for stock market investors, but the companies that executed the trades, underwrote the public offerings and ran the mutual funds have nothing to complain about.

Two of those companies, T. Rowe Price Associates Inc. and Alex. Brown Inc., reported higher fourth-quarter and 1992 earnings yesterday, based on their abilities to bring together companies and investors.

"It was a very good underwriting year," said Michael Lipper, president of Lipper Analytical Services in New York. "Fees on equity underwriting were a record."

And while the Dow Jones industrial average "meandered" throughout the year, ending up less than 5 percent higher than 1991's close, "volume last year on the exchange was high," Mr. Lipper said -- better even than 1987, the year of the stock market crash.

Alex. Brown Inc.

A. B. Krongard, Alex. Brown's chief executive, attributed the company's solid performance to strength in all of the investment company's business lines: investment banking, advisory services, and retail and institutional trading commissions, as well as trading for the company's own accounts.

Alex. Brown earned $21.1 million, or $1.37 a share, in the fourth quarter, compared with $19.1 million, or $1.21 a year ago. Revenues were up only 1.5 percent, to $128.1 million, in the quarter.

For the full year, the company reported a $58.6 million profit, or $3.72 a share, up from 1991 earnings of $52 million, or $3.36 a share. Revenues grew to $455.7 million, from $410.6 million in 1991, the company said.

Although revenues from investment banking fell 10 percent during the fourth quarter, the business was by far the company's most important in 1992, providing about $170 million in revenues during the year, up 11 percent from the year before.

The company also declared a regular cash dividend of 12.5 cents a share, to be paid Feb. 18 to stockholders of record on Feb. 9.

Alex. Brown's stock closed at $23.625 yesterday, up 62.5 cents a share in trading on the New York Stock Exchange.

T. Rowe Price Associates Inc.

T. Rowe Price reported a 14 percent rise in fourth-quarter earnings, to $9.6 million, or 64 cents a share, compared with year-ago earnings of $8.4 million, or 56 cents a share. Revenues were $65.4 million in the quarter, 17 percent greater than a year ago.

For the year, the mutual fund company earned $35.8 million, or $2.37 a share, about 18 percent higher than 1991 earnings of $30.4 million, or $2.04 a share. Revenues in 1992 were $245.1 million, 19 percent more than a year earlier.

President George J. Collins said the earnings increase came primarily from advisory fees and administrative services provided for customers, who invested a record amount in the firm's more than 40 mutual funds.

Total assets under management grew to $41.4 billion on Dec. 31, from $35.6 billion a year ago.

The stock market, which has been typically kind to the company, drove its share price down $1 yesterday, to $49 a share, in trading on the New York Stock Exchange.

Alex. Brown Inc.

Ticker... ... ... ... Yesterday's

Symbol... ... ... .. Cls... .Chg.

AB... ... ... .. ... 23 5/8 ... ...+ 5/8

Period ended

Dec. 31... ... ... ... 4th qtr... ... ... ... Year ago... ... ... Chg.

Revenue... ... ... .. $128,055... ... ... ... $126,176... ... . +1.49%

Net Income... ... ... $21,057... ... ... ... ..$19,108... ... . +10.2%

Primary EPS... ... ... . $1.37... ... ... ... .. $1.21... ... . +13.2%

... ... ... ... ... ...Year... ... ... ... ...Year ago... ... ... Chg.

Revenue... ... ... $455,724... ... ... ... .. $410,580... ... . +11.0%

Net Income... ... . $58,611... ... ... ... ... $51,952... ... . +12.8%

Primary EPS... ... .. $3.72... ... ... ... ... . $3.36... ... . +10.7%

Figures in thousands (except per share data.)

T. Rowe Price Associates Inc.

Ticker... ... ... ... Yesterday's

Symbol... ... ... .. Cls... .Chg.

TROW... ... ... ... ... ... .49-1

Period ended

Dec. 31... ... ... ... 4th qtr... ... ... ... Year ago... ... ... Chg.

Revenue... ... ... ... $65,365... ... ... ... $55,934... ... .. +16.9%

Net Income... ... ... . $9,646... ... ... ... .$8,425... ... ..+14.5%

Primary EPS... ... ... . $0.64... ... ... ... . $0.56... ... ..+14.3%

... ... ... ... ... ... Year... ... ... ... ... Year ago... ... . Chg.

Revenue... ... ... $245,112... ... ... ... ... $205,206... ... .+19.4%

Net Income... ... .. $35,784... ... ... ... ... $30,437... ... +17.6%

Primary EPS... ... ... $2.37... ... ... ... ... .. $2.04... ...+16.2%

Figures in thousands (except per share data.)

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