first-quarter profit falls 20 percent
Send a link to a friend
[April 14, 2016]
By Trevor Hunnicutt and Sudarshan Varadhan
(Reuters) - BlackRock Inc, the world's
largest asset manager, posted a 20 percent drop in first-quarter profit
on Thursday amid a dramatic reversal in financial markets. The New
York-based company's net income fell to $657 million, or $3.92 per
share, in the quarter, from $822 million, or $4.84 per share, a year
BlackRock attracted total long-term net inflows of $36.08 billion in
the quarterly period, down from $70.44 billion in the same quarter
On an adjusted basis, BlackRock earned $4.25 per share, falling
short of the average analyst estimate of $4.29, according to Thomson
Chief Executive Officer Larry Fink attributed a portion of the
decline to lower fees collected on investment products, such as
"The Street was anticipating higher performance fees," Fink said on
CNBC television. "That's where the miss was."
In the last quarter of 2015, the company took in $54 billion into
its funds despite weak and turbulent markets, driving profits
higher. But the company nonetheless missed Wall Street analysts'
expectations for that quarter.
BlackRock's iShares exchange-traded funds (ETFs) business took in
$24.25 billion in new money in the latest quarter, down from $35.48
billion a year earlier.
The lion's share invested in ETFs went into bonds as U.S. markets
began the year with one of their roughest starts ever only to regain
their footing in February.
Net investment in fixed income was $52.17 billion, while $2.15
billion went into alternative investments.
[to top of second column]
BlackRock ended the quarter with $4.74 trillion in assets under
management, up from $4.65 trillion at the end of 2015.
Up to Wednesday's close of $348.29, BlackRock's shares had risen
about 2.3 percent since the start of the year.
BlackRock's stock traded nearly 5 percent lower at the end of 2015
than at the end of 2014, while a grouping of similar companies
measured by the Dow Jones U.S. Asset Managers Index fell by 12
percent. Over the year, the stock returned negative 2.3 percent, a
figure that includes dividend payouts.
(Reporting by Sudarshan Varadhan in Bengaluru and Trevor Hunnicutt
in New York; Editing by Anil D'Silva and Jeffrey Benkoe)
[© 2016 Thomson Reuters. All rights
Copyright 2016 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed.