Alliance Capital Management L.P. Announces Second Quarter Financial Results and Record Assets Under Management.NEW YORK--(BUSINESS WIRE)--July 29, 1999-- Alliance Capital Management L.P. (NYSE NYSE See: New York Stock Exchange : "AC") today announced second quarter 1999 net income of $0.55 per Unit, an increase of 28% from the second quarter of 1998. Alliance declared de·clare v. de·clared, de·clar·ing, de·clares v.tr. 1. To make known formally or officially. See Synonyms at announce. 2. To state emphatically or authoritatively; affirm. 3. a $0.54 per Unit distribution payable on August 16, 1999, to holders of Units at the close of business on August 9, 1999. -- Assets under management Assets Under Management (AUM) is a term used by financial services companies in the mutual fund and money management or investment management business to gauge how much money they are managing. posted a quarter end record of $321.0 billion, increasing 22% from $262.5 billion at June June: see month. 30, 1998, the result of market appreciation, net new business, and superior investment results. -- Net income rose to $97.2 million, increasing 28% from $75.8 million for the second quarter of 1998. Diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. net income per Unit rose to $0.55 in second quarter 1999 from $0.43 per Unit for second quarter 1998. Performance fees contributed $0.03 per Unit in second quarter 1999, in line with the $0.03 per Unit contributed in the second quarter of 1998. Performance fees, which apply only to certain accounts, are based on the sharing of investment returns by the client and the investment manager. Performance fees may increase the volatility Volatility 1. A statistical measure of the tendency of a market or security to rise or fall sharply within a period of time. 2. A variable in option pricing formulas that denotes the extent to which the return of the underlying asset will fluctuate between now and the of the Partnership's revenues and earnings. -- Revenues rose to $418.9 million, increasing 26% from $332.1 million for second quarter 1998. Revenue growth for the quarter resulted primarily from higher average assets under management and a larger proportion of higher fee mutual fund assets Fund assets The total value of a portfolio's securities, cash, and other holdings, minus any outstanding debts. under management. -- Pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta margin increased to 36.5% compared to 35.3% for the second quarter 1998. Pre-tax margin is calculated after netting distribution revenues with distribution expenses, as detailed on page 6. -- Distributions increased to $0.54 per Unit for second quarter 1999, a 29% increase over the $0.42 per Unit distributed for second quarter 1998 and the same as the $0.54 per Unit distribution for the first quarter of 1999. President and Chief Operating Officer Chief Operating Officer (COO) The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. John D. Carifa, commenting on strong new business flows from U.S. individual and institutional investors Institutional Investor A non-bank person or organization that trades securities in large enough share quantities or dollar amounts that they qualify for preferential treatment and lower commissions. , stated "Alliance continues to realize sizable siz·a·ble also size·a·ble adj. Of considerable size; fairly large. siz  a·ble·ness n. increases
in net new sales, led by our diverse line of mutual fund products. Gross
sales Gross SalesA measure of overall sales that isn't adjusted for customer discounts or returns, calculated simply by adding all sales invoices, and not including operating expenses, cost of goods sold, payment of taxes, or any other charge. of U.S. open-end o·pen-end adj. 1. Having no definite limit of duration or amount: an open-end contract. 2. mutual funds increased 96% in the first half of 1999, totaling $11 billion. Alliance won 133 new separately managed client accounts from institutional investors and high-net-worth individuals, totaling $6.0 billion, during the same period; these accounts were awarded primarily by U.S. investors. Competitive 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. investment performance, coupled with targeted marketing efforts to institutional investors and to individual investors through all major financial intermediary Financial Intermediary An institution that acts as the middleman between investors and firms raising funds. Often referred to as financial institutions. Notes: This can include chartered banks, insurance companies, investment dealers, mutual funds, and pension funds. channels, gives Alliance a strong platform for future business growth." Chief Executive Officer Bruce Bruce, Scottish royal family descended from an 11th-century Norman duke, Robert de Brus. He aided William I in his conquest of England (1066) and was given lands in England. W. Calvert Cal·vert Family of English colonists in America, including George (1580?-1632), First Baron Baltimore; his son Cecilius (1605-1675), Second Baron and recipient of the Maryland charter; another son, Leonard remarked on Alliance's growing international client base. "In Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). , our
subadvisory and distribution agreement with Eptaconsors has raised over
$2 billion in assets under management in its first year of operation. In
Japan, Alliance maintains its position serving Japanese Japanese (jăp'ənēz`), language of uncertain origin that is spoken by more than 125 million people, most of whom live in Japan. There are also many speakers of Japanese in the Ryukyu Islands, Korea, Taiwan, parts of the United States, and individual
investors as the second largest foreign owned investment trust manager.
Alliance won five new Japanese institutional client accounts in the
first half of 1999, across a number of investment disciplines."
Chairman Dave H. Williams commented that "Alliance's robust growth in assets under management and attention to expense growth resulted in yet another strong quarter of earnings and distributions to Unitholders. We will continue to pursue those opportunities we believe offer the best prospects for bolstering our position as a premier global investment manager." About Alliance Capital Management L.P. Alliance Capital Management L.P. is the nation's largest publicly traded asset manager, as measured by assets under management, with more than $321 billion in client assets under management at June 30, 1999. Alliance Capital manages retirement assets for many of the largest public and private employee benefit plans (including 29 of the nation's Fortune 100 companies), for public employee retirement funds in 32 out of the 50 states, and for foundations, endowments, banks, and insurance companies worldwide. Alliance Capital is one of America's largest mutual fund sponsors, with a diverse family of fund portfolios and approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 4.5 million shareholder accounts. As of June 30, 1999, wholly owned subsidiaries Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. of The Equitable equitable adj. 1) just, based on fairness and not legal technicalities. 2) refers to positive remedies (orders to do something, not money damages) employed by the courts to solve disputes or give relief. (See: equity) EQUITABLE. Companies Incorporated owned a 1% general partnership interest in Alliance and approximately 56% of the Partnership's outstanding Units. -0-
ALLIANCE CAPITAL MANAGEMENT L.P.
SUMMARY CONSOLIDATED STATEMENTS OF INCOME
(unaudited, in $ thousands except per Unit amounts)
Three Months Ended Six Months Ended
6/30/99 6/30/98 6/30/99 6/30/98
------- -------- -------- --------
Revenues:
Investment advisory and
services fees:
Alliance mutual funds $185,928 $145,174 $380,827 $287,705
Separately managed accounts:
Affiliated clients 14,171 16,780 26,894 30,186
Third party clients 91,176 75,845 188,972 155,369
Distribution revenues 105,218 76,108 198,830 142,289
Shareholder servicing fees 15,500 11,093 28,797 19,581
Other revenues 6,948 7,120 14,364 13,007
------- -------- -------- --------
418,941 332,120 838,684 648,137
------- -------- -------- --------
Expenses:
Employee compensation and
benefits 102,693 82,203 220,972 170,030
Promotion and servicing:
Distribution plan payments
to financial intermediaries:
Affiliated 25,191 19,272 50,875 36,726
Third party 57,728 46,664 109,869 86,128
Amortization of deferred
sales commissions 40,017 25,649 74,698 48,496
Other 28,093 23,555 54,896 44,869
General and administrative 45,403 41,258 87,739 83,397
Interest 4,479 2,187 7,980 4,154
Amortization of intangible assets 964 1,039 1,927 1,920
------- -------- -------- --------
304,568 241,827 608,956 475,720
------- -------- -------- --------
Income before income taxes 114,373 90,293 229,728 172,417
Income taxes 17,159 14,452 34,460 27,592
------- -------- -------- --------
Net income $97,214 $75,841 $195,268 $144,825
======= ======== ======== ========
Basic net income per Unit $ 0.56 $0.44 $1.13 $0.85
======= ======== ======== ========
Diluted net income per Unit $0.55 $0.43 $1.10 $0.82
======= ======== ======== ========
Distributions per Unit $0.54 $0.42 $1.08 $0.80
======= ======== ======== ========
Weighted average Units
outstanding - Basic 171,043 169,914 170,804 169,609
======= ======== ======== ========
Weighted average Units
outstanding - Diluted 176,368 175,358 175,968 174,949
======= ======== ======== ========
-- Unit and per Unit amounts for all periods prior to the
two-for-one split in 1998 have been restated.
CHANGES IN ASSETS UNDER MANAGEMENT
THREE MONTHS ENDED JUNE 30, 1999
($ millions)
Separately
Managed
Accounts Mutual Funds Total
--------- ------------ -------
Beginning of Period $174,084 $127,269 $301,353
New business/sales 1,933 13,822 15,755
Terminations/redemptions (584) (6,724) (7,308)
Net cash management sales -- 682 682
Cash flow (2,280) (249) (2,529)
Transfers (472) 472 --
Appreciation 7,438 5,615 13,053
----- ----- ------
Net change 6,035 13,618 19,653
----- ------ ------
End of Period $180,119 $140,887 $321,006
======== ======== ========
CHANGES IN ASSETS UNDER MANAGEMENT
TWELVE MONTHS ENDED JUNE 30, 1999
($ millions)
Separately
Managed
Accounts Mutual Funds Total
---------- ------------ -------
Beginning of Period $155,391 $107,125 $262,516
Acquisitions 1,402 125 1,527
New business/sales 5,605 41,513 47,118
Terminations/redemptions (2,204) (20,987) (23,191)
Net cash management sales -- 2,564 2,564
Cash flow (4,579) (1,446) (6,025)
Exchanges/Transfers (502) 502 --
Appreciation/Depreciation 25,006 11,491 36,497
------ ------ ------
Net change 24,728 33,762 58,490
--------- --------- ---------
End of Period $180,119 $140,887 $321,006
======== ======== ========
ASSETS UNDER MANAGEMENT
($ millions)
Three Months Ended Six Months Ended
6/30/99 6/30/98 6/30/99 6/30/98
-------- -------- -------- --------
Average Assets Under
Management $306,924 $253,191 $300,122 $241,984
======== ======== ======== ========
Ending Assets Under
Management $321,006 $262,516 $321,006 $262,516
======== ======== ======== ========
ANALYSIS OF PRE-TAX MARGIN
($ thousands)
Three Months Ended Six Months Ended
6/30/99 6/30/98 6/30/99 6/30/98
--------- -------- -------- ---------
Total revenues $418,941 $332,120 $838,684 $648,137
Less: Distribution
revenues (105,218) (76,108) (198,830) (142,289)
--------- -------- -------- ---------
Net revenues $313,723 $256,012 $639,854 $505,848
--------- -------- -------- --------
Total expenses $304,568 $241,827 $608,956 $475,720
Less: Distribution
revenues (105,218) (76,108) (198,830) (142,289)
--------- -------- -------- ---------
Net expenses $199,350 $165,719 $410,126 $333,431
--------- -------- -------- --------
Income before income
taxes $114,373 $90,293 $229,728 $172,417
Pre-tax margin 36.5% 35.3% 35.9% 34.1%
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