Fueled by a steady recovery in the financial markets and increasing investor confidence, T. Rowe Price Group on Thursday reported sharp increases in revenue and profit for last year's fourth quarter.
The Baltimore money manager had revenue of $542.6 million in the quarter — a 30 percent increase over the $415.9 million it posted in the same quarter in 2008. Net income climbed to $152.5 million, or 57 cents per share, up from $24.3 million, or 9 cents per share in the year-earlier quarter — an amount that at the time reflected a one-time charge of $88 million that detracted from greater profitability.
Earnings beat Wall Streets estimates of 55 cents a share based on a survey of 17 analysts by Bloomberg.
James A. C. Kennedy, T. Rowe's president and chief executive officer, said in an interview that investors are regaining their confidence in the financial markets, but their investments remain behind the peaks they saw before the recession hit and the markets hit bottom in early 2009.
"There's nothing phenomenal about the quarter other than we continued to perform well for our clients," Kennedy said. "We're not worried about the stability of the company, so we remain focused on working for the clients."
T. Rowe's revenue increase was driven by growth in its investment advisory services; clients poured $7.3 billion into its mutual funds and other products. Higher market valuations and income added $17.8 billion more to T. Rowe's assets under management.
Revenue from its investment advisory services grew to $461.7 million in the quarter, up 40 percent from $329.9 million in the year-earlier period.
The company also reported full-year results, with total revenues falling to $1.87 billion, from $2.1 billion in 2008. Net income was also down for the year, with $433.6 million in profit compared with $490.8 million in 2008.