Record earnings posted by Price, Alex. Brown

January 27, 1994|By David Conn | David Conn,Staff Writer

The business of making money for others remained remarkably lucrative last year, as the fourth-quarter earnings of two of Baltimore's largest investment firms show.

Both mutual fund manager T. Rowe Price Associates Inc. and Alex. Brown Inc., a brokerage and investment banking firm, reported record earnings yesterday.

The stock market reacted favorably to Price's numbers, driving its stock up $1 a share on the day to close at $29.75 a share.

Alex. Brown's shares rose $1.625, to $25.75 a share, although the company released its earnings after the market closed.

But a familiar refrain of "How long?" has been raised by some analysts as they ponder what effect a rise in interest rates and a drop in the stock market would have on companies that rely on the confidence of investors in the stock market.

"Can the rate of increase [in profits] continue? I don't think so," said A. Michael Lipper, of Lipper Analytical Services Inc. in New York -- at least not more than another year.

T. Rowe Price

With more than $54 billion in clients' funds under management, T. Rowe Price reported a 53 percent increase in fourth-quarter profits, to $14.7 million, or 48 cents a share, from $9.6 million, or 32 cents a share in the fourth quarter of 1992.

Revenues during the quarter were up 37.5 percent to $89.9 million from $65.4 million a year earlier.

"Based on record assets under management, continuing significant net cash inflows to the Price funds, and our outlook for the financial markets, we remain optimistic about the company's future prospects," President George J. Collins said in a statement.

Mr. Collins said growth in the company's international investment assets has been particularly strong. Of the total under management, $15.4 billion was managed by Rowe Price-Fleming International, a 50 percent-owned subsidiary, more than twice as much as last year.

Alex. Brown Inc.

The parent of Alex. Brown & Sons Inc. saw earnings during the fourth quarter rise 85 percent, to $38.9 million, or $2.42 a share, from $21.1 million, or $1.37 a share, a year earlier. Chief Executive Officer A. B. Krongard said the improvements came from higher revenues in all of the company's lines of business, from investment banking, the largest segment, to commissions from retail and institutional trading, and revenues from its advisory business.

Alex. Brown finished 1993 as the fifth-most-active underwriter of public stock offerings, and the sixth-most-active in initial public offerings.

For all of 1993, profits rose 52 percent, to $89.2 million, or $5.61 a share, from $58.6 million, or $3.72 a share in 1992. Revenues were up 71 percent in the fourth quarter and 38 percent during the year.

To receive, by fax, a copy of T. Rowe Price's fourth-quarter earnings report, dial Sunfax at (410) 332-6123. After you hear the greeting, enter the information number 5605.

T. Rowe Price

Associates Inc.

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

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

.. .. .. .. .. .. .. .. .. .. ..TROW .. .. ..29 3/4 .. .. .. .. .+1

Period ended

12/31/93 .. .. .. .. .. .. .4th qtr. .. ...Year ago .. ...Chg.

Revenue .. .. .. .. .. .. ..$89,881 .. .. ..$65,365 .. .+37.5%

Net Income .. .. .. .. .. .$14,744 .. .. ...$9,646 .. .+52.9% ......TC Primary EPS .. .. .. . .. .. .$0.48 .. .. .. .$0.32 .. .+50.0%

.. .. .. .. .. .. .. .. .. .12 mos. .. .. .Year ago .. ...Chg.

Revenue .. .. .. .. .. .. .$310,041 .. .. .$245,112 .. .+26.5%

Net Income .. .. .. .. .. .$48,539 * .. .. .$35,784 .. .+35.6%

Primary EPS .. .. .. .. .. ..$1.59 * .. .. ...$1.19 .. .+33.6%

Figures in thousands (except per share data and footnotes.) All per share numbers have been adjusted to reflect a 2-for-1 stock split in November 1993.

* Includes a charge of $330,000, or $0.01 a share, because of a change in accounting principles.

Alex. Brown Inc.

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

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

.. .. .. .. .. .. .. .. .. .AB .. .. .. ...25 3/4 .. .. .. ...+1 5/8

Period ended

12/31/93 .. .. .. .. ...4th qtr. .. .. ..Year ago .. ...Chg.

Revenue .. .. .. .. ...$218,774 .. .. ...$128,055 .. .+70.8%

Net Income .. .. .. .. .$38,914 .. .. .. .$21,057 .. .+84.8%

Primary EPS .. .. .. .. ..$2.42 .. .. .. ...$1.37 .. .+76.6%

.. .. .. .. .. .. .. .. .12 mos. .. .. ..Year ago .. ...Chg.

Revenue .. .. .. .. .. .$628,203 .. .. ..$455,724 .. .+37.8%

Net Income .. .. .. .. ..$89,226 .. .. ...$58,611 .. ..+52.2

Primary EPS .. .. .. .. ...$5.61 .. .. .. ..$3.72 .. .+50.8%

Figures in thousands (except per share data.)

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