AMVESCAP PLC Reports Results for Three Months Ended March 31, 2002.Business Editors LONDON--(BUSINESS WIRE)--April 24, 2002 AMVESCAP reported that profit before tax, exceptional item and goodwill amortization for the three months ended March 31, 2002 amounted to (pound)97.5 million ($139.4 million) compared to (pound)135.0 million ($191.7 million) for the first quarter of 2001. Revenues totaled (pound)377.7 million ($540.1 million) for the 2002 quarter, compared to (pound)427.3 million ($606.8 million) in 2001. Diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of before goodwill amortization and exceptional items amounted to 8.2p for the 2002 period (2001: 11.3p) a decrease of 27% from the first quarter of 2001. (NYSE NYSE See: New York Stock Exchange : AVZ).
Results for Three Months Ended
2002 2001 2002++ 2001++
------------------------------------------------
Revenues (pound)377.7m (pound)427.3m $540.1m $606.8m
Profit before tax,
goodwill amortization
and exceptional items (pound)97.5m (pound)135.0m $139.4m $191.7m
Earnings per share
before goodwill
amortization:
--basic 8.3p 11.2p(a) $0.24+ $0.32(a)+
--diluted 8.2p 10.8p(a) $0.23 $0.31(a)+
Earnings per share
before goodwill
amortization and
exceptional items:
--basic 8.3p 11.7p(a) $0.24(a) $0.33(a)+
--diluted 8.2p 11.3p(a) $0.23+ $0.32(a)+
----------------------------------------------------------------------
(a) Restated for adoption of FRS 19, "Deferred Tax."
+ Per American Depository Share equivalent to 2 ordinary shares.
++ For the convenience of the reader, pounds sterling for the
three months ended March 31, 2002 have been translated to US
dollars using $1.43 per (pound)1.00 (2001: $1.42 per
(pound)1.00).
"The global markets remained sluggish during the quarter due to the uncertainty in the Middle East, terrorism terrorism, the threat or use of violence, often against the civilian population, to achieve political or social ends, to intimidate opponents, or to publicize grievances. , and the general economic climate," said Mr. Charles Charles, archduke of Austria Charles, 1771–1847, archduke of Austria; brother of Holy Roman Emperor Francis II. Despite his epilepsy, he was the ablest Austrian commander in the French Revolutionary and Napoleonic wars; however, he was handicapped by W. Brady Bra·dy , James Buchanan Known as "Diamond Jim." 1856-1917. American financier and philanthropist who gained his nickname because of his attraction to diamonds and his extravagant lifestyle. Noun 1. , Executive Chairman. "We expect these market conditions will continue further into the year; however, signs of some economic recovery appear to be surfacing. This recovery could be a positive for the later part of the year. We remain optimistic op·ti·mist n. 1. One who usually expects a favorable outcome. 2. A believer in philosophical optimism. op about the long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. and continue to be focused on expense controls and on the opportunities that will allow us to benefit from operating leverage Operating Leverage A measurement of the degree to which a firm or project relies on fixed rather than variable costs. Notes: The higher the degree of operating leverage, the greater the potential danger from forecasting risk. produced by improving markets." The Company adopted FRS FRS abbr. Fellow of the Royal Society FRS, n “flexed rotated side-bent,” an osteopathic abbreviation used to describe vertebral position in cases of spinal dysfunction. 19, "Deferred Tax" in 2001 and restated the prior year's profit and loss accounts to reflect these new reporting requirements. Funds under management totaled $400.0 billion at March 31, 2002, an increase of $2.1 billion from December December: see month. 31, 2001. Average funds under management amounted to $392.3 billion for the first quarter of 2002, compared to $384.9 billion for the fourth quarter of 2001, and $401.7 billion for the first quarter of 2001. Approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 58% of the total funds under management was invested in equity securities, and 42% was invested in fixed income securities at both March 31, 2002 and December 31, 2001. Earnings before interest, taxes, depreciation and amortization Earnings before interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP metric that can be used to evaluate a company's profitability.
AMVESCAP is a leading independent global investment manager, dedicated to helping people worldwide build their financial security. Operating under the AIM, INVESCO INVESCO, (NYSE: IVZ) is an investment management company based in London, England, UK. It is quoted on the London Stock Exchange and is a member of the FTSE 100 Index. It has branches in 19 countries, but more than half of its business is in the United States. and Atlantic Trust brands, AMVESCAP strives to deliver outstanding investment performance and service through a comprehensive array of retail and institutional products for clients in over 100 countries. The Company is listed on the London London, city, Canada London, city (1991 pop. 303,165), SE Ont., Canada, on the Thames River. The site was chosen in 1792 by Governor Simcoe to be the capital of Upper Canada, but York was made capital instead. London was settled in 1826. , New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of , Paris and Toronto Stock Exchanges Toronto Stock Exchange (TSE) Canada's largest stock exchange, trading approximately 1,200 company stocks and 33 options. with the symbol "AVZ." Members of the investment community and general public are invited to listen to the conference call today, Wednesday Wednesday: see week. , April 24, 2002 at 9:30a.m. Eastern Time, by dialing one of the following numbers: 888-201-4990 for US callers or 630-395-0024 for international callers. An audio replay of the conference call will be available until Wednesday, May 1, 2002 at 5:00p.m. Eastern Time by calling 800-518-0087 for US callers or 402-998-0052 for international callers.
AMVESCAP PLC
Group Profit and Loss Account
(in thousands)
Three Months Ended March 31,
-------------- ----------------
2002 2001
-------------- ----------------
Revenues (pound)377,749 (pound)427,277
Expenses
Operating expenses (272,901) (281,017)
Exceptional items -- (4,207)
Goodwill amortization (36,837) (31,811)
-------------- ----------------
Operating profit 68,011 110,242
Investment income 6,653 3,001
Interest payable (14,038) (14,306)
-------------- ----------------
Profit before taxation 60,626 98,937
Taxation (29,823) (41,297)
-------------- ----------------
Retained profit for the period (pound)30,803 (pound)57,640
============== ================
Earnings per share before
goodwill amortization:
---basic 8.3p 11.7p(a)
---diluted 8.2p 11.3p(a)
-------------- ----------------
Earnings per share:
---basic 3.8p 7.2p
---diluted 3.7p 7.0p
-------------- ----------------
Average shares outstanding:
---basic 811,887 798,664
---diluted 829,724 836,515
-------------- ----------------
-------------- ----------------
(a) Before exceptional items
AMVESCAP PLC
Group Balance Sheet
(in thousands)
March 31, 2002 Dec 31, 2001
-------------- ----------------
Fixed assets
Goodwill (pound)2,657,156 (pound)2,693,659
Investments 155,980 166,036
Tangible assets 185,128 209,370
-------------- ----------------
2,998,264 3,069,065
Currents assets
Debtors 704,347 576,447
Investments 25,956 33,116
Cash 165,872 175,902
-------------- ----------------
896,175 785,465
Creditors (782,136) (640,804)
-------------- ----------------
Net current assets, excluding
banking and insurance
activities 114,039 144,661
Banking and insurance
activities
Cash 173,593 175,076
Investments 104,119 89,079
Customer and counterparty
debtors 179,565 179,223
Policyholder debtors 141,656 134,296
Customer and counterparty
creditors (335,627) (349,560)
Policyholder creditors (141,656) (134,296)
Other assets, net (6,166) (9,725)
-------------- ----------------
115,484 84,093
Total assets less current
liabilities 3,227,787 3,297,819
Long-term debt (760,036) (844,285)
Provisions for liabilities and
charges (174,457) (172,070)
-------------- ----------------
Net assets (pound)2,293,294 (pound)2,281,464
============== ================
Capital and reserves
Called up share capital (pound)196,749 (pound)196,037
Share premium account 1,631,988 1,619,879
Exchangeable shares 432,165 433,597
Profit and loss account 716,687 685,884
-------------- ----------------
2,977,589 2,935,397
Other reserves (684,295) (653,933)
-------------- ----------------
Shareholders' funds, equity
interests (pound)2,293,294 (pound)2,281,464
============== ================
AMVESCAP plc
Group Cash Flow Statement
(in thousands)
Three Months Ended March 31,
------------------------------------
2002 2001
-------------- ----------------
Operating profit, excluding
banking and insurance
activities (pound)67,164 (pound)106,218
Amortization and depreciation 52,448 48,799
Change in debtors, creditors
and other (398) (32,928)
-------------- ----------------
Net cash inflow from operating
activities, excluding
banking and insurance
activities 119,214 122,089
-------------- ----------------
Banking and insurance
activities (3,817) (53,486)
Interest paid, net of
investment income (891) (5,610)
Taxation (21,010) (23,293)
Capital expenditures, net of
sales (4,408) (16,554)
(Purchase)/disposal of fixed
asset investments, net (6,161) 6,854
Acquisitions -- (36,825)
Net repayment of debt (96,631) (184,089)
Foreign exchange on cash at
bank and in hand 2,191 3,109
-------------- ----------------
-------------- ----------------
Decrease in cash at bank and
in hand (pound)(11,513) (pound)(187,805)
============== ================
AMVESCAP PLC
Segmental Information
(in thousands)
Three Months Ended March 31, 2002
----------------------------------------------
Revenues Expenses Profit
----------------------------------------------
Managed Products (pound)225,184 (pound)(131,479) (pound)93,705
INVESCO Institutional 52,258 (40,221) 12,037
INVESCO Global 75,253 (63,280) 11,973
INVESCO Retirement 15,304 (14,881) 423
Private Wealth 9,368 (9,313) 55
New Business 382 (3,229) (2,847)
Corporate -- (10,498) (10,498)
-------------- ---------------- -------------
(pound)377,749 (pound)(272,901)(pound)104,848
============== ================ =============
Three Months Ended March 31, 2001
----------------------------------------------
Revenues Expenses Profit
----------------------------------------------
Managed Products (pound)265,229 (pound)(147,913)(pound)117,316
INVESCO Institutional 51,520 (38,182) 13,338
INVESCO Global 94,274 (69,725) 24,549
INVESCO Retirement 13,667 (11,353) 2,314
Private Wealth 2,332 (1,884) 448
New Business 255 (3,120) (2,865)
Corporate -- (8,840) (8,840)
----------------------------------------------
(pound)427,277 (pound)(281,017)(pound)146,260
============== ================= =============
Notes
1. The taxation charge is estimated based on the total expected tax
charge for the year. A significant proportion of the charge is
expected to arise from US operations.
The UK Accounting Standards Board issued FRS 19, "Deferred Tax,"
which requires companies to change the method of computing
deferred taxes. The Company has adopted this new statement in
2001, including a restatement of prior years' profit and loss
accounts. The effect of FRS 19 has been to reduce the income tax
provision and increase net income for the first quarter of 2001 by
(pound)1.9 million (0.2p per diluted share).
2. Profit before goodwill amortization and exceptional items is a
more appropriate basis for the calculation of earnings per share
since this represents a more consistent measure of the year by
year performance of the business, therefore the calculation below
is presented on that basis. Basic earnings per share is based on
the weighted average number of ordinary and exchangeable shares
outstanding during the respective periods. Diluted earnings per
share takes into account the effect of dilutive potential ordinary
and exchangeable shares outstanding during the period.
2002
Profit before
goodwill
amortization Number of shares Per share
(pound)'000 '000 amount
----------------------------------------------
Basic earnings per share 67,640 811,887 8.3p
=============
Issuance of options -- 17,837
-------------- -----------------
Diluted earnings per
share 67,640 829,724 8.2p
============== ================= =============
2001
Profit before
goodwill
amortization
and exceptional
items Number of shares Per share
(pound)'000 '000 amount
----------------------------------------------
Basic earnings per share 93,658 798,664 11.7p
============
Conversion of ESDs 672 6,146
Issuance of options -- 31,705
-------------- -----------------
Diluted earnings per
share 94,330 836,515 11.3p
============== ================= ============
3. The company completed five acquisitions in 2001, including County
Investment Management Limited on January 31, 2001. This
acquisition had no material effect on the consolidated financial
statements. A (pound)4.2 million exceptional item was recognized
during the 2001 quarter related to integration activities for the
County acquisition. These acquisitions have been included from the
dates of acquisition in 2001.
AMVESCAP PLC
Funds Under Management
(in billions)
Managed Products
---------------------------
---------------------------
Total AIM INVESCO
----------------------------------------------
Dec 31, 2001 $397.9 $179.8 $31.4
Market gains/(loss) 1.3 0.1 (0.9)
Net new/(lost) business 0.2 0.4 (0.4)
Change in money
market funds 1.2 1.9 (0.2)
Transfers -- (0.1) --
Foreign currency (0.6) (0.1) --
-------------- ----------------- -------------
March 31, 2002 $400.0 $182.0 $29.9
============== ================= =============
March 31, 2002 (a) (pound)279.7 (pound)127.3 (pound)20.9
============== ================= =============
INVESCO INVESCO Private
Inst Global Wealth
----------------------------------------------
Dec 31, 2001 $116.8 $60.0 $9.9
Market gains/(loss) 0.3 1.8 --
Net new/(lost) business (1.0) 1.3 (0.1)
Change in money
market funds -- (0.5) --
Transfers 0.1 -- --
Foreign currency -- (0.5) --
----------------------------------------------
March 31, 2002 $116.2 $62.1 $9.8
============== ================= =============
March 31, 2002 (a) (pound)81.3 (pound)43.4 (pound)6.8
============== ================= ============
(a) Translated at $1.43 per (pound)1.00.
Note: INVESCO Retirement has $35.6 billion in assets under
administration as of March 31, 2002, compared to $34.6 billion as of
December 31, 2001.
AMVESCAP PLC
Reconciliation to US Accounting Principles
(in thousands)
Three Months Ended March 31,
2002 2001
------------------------------------
Net profit under UK GAAP (pound)30,803 (pound)57,640
US GAAP adjustments:
Acquisition accounting:
Amortization of
intangibles 36,095 (17,028)
Other acquisition
items (2,103) --
Taxation (3,815) (12,015)
Other 544 288
-------------- ----------------
Net income under US GAAP (pound)61,524 (pound)28,885
============== ================
Earnings per ordinary share:
-- basic 7.6p 3.6p
-- diluted 7.4p 3.5p
Earnings per ordinary share
before goodwill
amortization:
-- basic 7.7p 10.3p
-- diluted 7.5p 9.9p
March 31, 2002 Dec 31, 2001
-------------- ----------------
Shareholders' funds under UK
GAAP (pound)2,293,294 (pound)2,281,464
US GAAP adjustments:
Acquisition accounting 1,034,477 984,436
Treasury stock (180,672) (186,134)
Dividends -- 52,708
Other (19,082) (20,443)
-------------- ----------------
Shareholders' equity under US
GAAP (pound)3,128,017 (pound)3,112,031
============== ================
Note: The US GAAP reconciliation reflects the adoption of
Statement of Financial Accounting Standards (SFAS) 141 and 142. SFAS
141, "Business Combinations," requires the allocation of excess
purchase price to goodwill or other intangible assets on acquisitions
after July 1, 2001. Accordingly, we have preliminarily allocated the
majority of the excess purchase price of the Pell Rudman, Grand
Pacific and Parkes acquisitions to goodwill. SFAS 142, "Goodwill and
Other Intangible Assets," was adopted January 1, 2002. SFAS 142
requires that all goodwill and indefinite-lived intangible assets no
longer be amortized, but instead tested for impairment annually. All
intangible assets have been preliminarily analyzed as of December 31,
2001 and no impairment exists.
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