Price predicts 30% rise in profit Annual meeting brings word of changes in top personnel

April 13, 1996|By Bill Atkinson | Bill Atkinson,SUN STAFF

T. Rowe Price Associates Inc. expects to post about a 30 percent increase in revenue and earnings for the first quarter of 1996, as consumers pour billions of dollars into mutual funds, the company said yesterday at its annual meeting.

"Overall, we are looking for another good year at T. Rowe Price," said George A. Roche, its chief financial officer. "We will achieve this increase even though spending was up substantially in a number of areas."

Price earned $15 million for the first quarter in 1995 on revenues of $97.8 million.

The company said it will release first-quarter 1996 earnings early next week.

Mr. Roche said assets under management at the Baltimore-based mutual fund company jumped by $5 billion to more than $80 billion in the first quarter of 1996.

And the company netted $3.1 billion in new money, which rolled into T. Rowe Price's mutual funds in the first three months of the year. The inflow was only $800 million shy of the total money for all of 1995.

Price's stock yesterday closed at $56.50, down 50 cents.

The company also announced that George J. Collins, who has been president and chief executive since 1984, will step aside a year from now to sail in next year's Whitbread, a major international sailing race that begins in Southampton, England, in September 1997.

Mr. Roche will become chief executive when Mr. Collins retires.

Price is unique because responsibility for its direction is shared by four individuals rather than one. They are Mr. Collins; Mr. Roche; James Riepe, who oversees the marketing and operation of T. Rowe Price's mutual funds; and M. David Testa, who heads the company's equity division.

After Mr. Collins' departure, the three other executives will hold the reins to the company.

Mr. Roche said he foresees the economy growing at a moderate rate through the remainder of the year.

"Given this environment, we expect only modest gains in the stock market this year, and a correction greater than any of the past four years could occur," he said. "We do not, however, see a prolonged downturn."

Mr. Collins said the company would expand through acquisition if "we find the right circumstances."

At the meeting, stockholders approved a 2-for-1 stock split and a proportional increase in the number of shares the company has authority to issue, from 100 million to 200 million.

The company also elected three new board members: James A. C. Kennedy, director of the firm's research equity division; John Laporte, senior portfolio manager of the firm's small-company growth equity funds; and William T. Reynolds, chairman of the fixed-income steering committee.

Pub Date: 4/13/96

Baltimore Sun Articles
|
|
|
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.