Eaton Vance Corp. Report for the Three and Nine Month Periods Ended July 31, 2014

BOSTON, Aug. 20, 2014 /PRNewswire/ -- Eaton Vance Corp. (NYSE: EV) today reported adjusted earnings per diluted share(1) of $0.63 for the third quarter of fiscal 2014, an increase of 21 percent over the $0.52 of adjusted earnings per diluted share in the third quarter of fiscal 2013 and an increase of 7 percent over the $0.59 of adjusted earnings per diluted share in the second quarter of fiscal 2014.  Net income and gains (losses) on seed capital investments contributed $0.01 in the third quarter of fiscal 2014, compared to -$0.02 and $0.01 in the third quarter of fiscal 2013 and second quarter of fiscal 2014, respectively.

As determined under generally accepted accounting principles in the United States of America ("GAAP"), the Company earned $0.63 in the third quarter of fiscal 2014, $0.18 in the third quarter of fiscal 2013 and $0.59 in the second quarter of fiscal 2014. In the third quarter of fiscal 2013, adjusted earnings differed from GAAP earnings to reflect $0.28 per diluted share of costs associated with retiring $250 million of the Company's 6.5 percent 2017 Senior Notes ("2017 Senior Notes"), $0.05 per diluted share of charges in connection with settling a state tax matter and $0.01 per diluted share of closed-end structuring fees incurred in that quarter.

Adjusted earnings per diluted share were $1.80 in the nine months ended July 31, 2014 compared to $1.53 in the nine months ended July 31, 2013, an increase of 18 percent. The Company's GAAP earnings per diluted share were $1.78 and $1.07, respectively, for these periods.

Net outflows of $2.0 billion from long-term funds and separate accounts in the third quarter of fiscal 2014 compare to net inflows of $8.8 billion in the third quarter of fiscal 2013 and net outflows of $0.9 billion in the second quarter of fiscal 2014. 

"Eaton Vance again achieved record earnings in the third quarter of fiscal 2014," said Thomas Faust Jr., Chairman and Chief Executive Officer.  "Although flows remain disappointing, continued development of emerging franchises and strong investment performance support improved organic growth in the coming quarters."   

Consolidated assets under management were $288.2 billion on July 31, 2014, an increase of 7 percent from the $268.8 billion of managed assets on July 31, 2013 and an increase of 1 percent from the $285.9 billion of managed assets on April 30, 2014.  The increase in ending assets under management from July 31 of last year reflects market appreciation of $19.6 billion and net outflows of $0.2 billion. The sequential quarterly increase in ending assets under management reflects market price appreciation of $4.4 billion and net outflows of $2.0 billion.

Average consolidated assets under management were $289.3 billion in the third quarter of fiscal 2014, up 10 percent from $263.7 billion in the third quarter of fiscal 2013 and up 2 percent from $284.4 billion in the second quarter of fiscal 2014. 

Attachments 5 and 6 summarize the Company's consolidated assets under management and asset flows by investment mandate and investment vehicle. Attachment 7 summarizes the Company's consolidated assets under management by investment affiliate.

As shown in Attachment 6, consolidated gross sales and other inflows were $26.2 billion in the third quarter of fiscal 2014, down 7 percent from $28.0 billion in the third quarter of fiscal 2013 and up 15 percent from $22.8 billion in the second quarter of fiscal 2014. Gross redemptions and other outflows were $28.2 billion in the third quarter of fiscal 2014, up 47 percent from $19.2 billion in the third quarter of fiscal 2013 and up 19 percent from $23.7 billion in the second quarter of fiscal 2014. 

As of July 31, 2014, 49 percent-owned affiliate Hexavest, Inc. ("Hexavest") managed $17.0 billion of client assets, an increase of 8 percent from the $15.7 billion of managed assets on July 31, 2013 and substantially unchanged from the $17.1 billion of managed assets on April 30, 2014. Hexavest-managed funds and separate accounts had net outflows of $0.3 billion in the third quarter of fiscal 2014, net inflows of $0.5 billion in the third quarter of fiscal 2013 and net outflows of $0.1 billion in the second quarter of fiscal 2014.  Attachment 9 summarizes assets under management and asset flow information for Hexavest. Other than Eaton Vance-sponsored funds for which Hexavest is advisor or sub-advisor, the managed assets and flows of Hexavest are not included in Eaton Vance consolidated totals.

Financial Highlights

















Three Months Ended



(in thousands, except per share figures)











July 31,

April 30,

July 31,



2014

2014

2013









Revenue

$

367,590

$

354,061

$

350,361

Expenses


236,412


228,758


231,511

Operating income


131,178


125,303


118,850









    Operating margin


35.7%


35.4%


33.9%









Non-operating expense


(4,850)


(7,226)


(71,315)

Income taxes


(48,899)


(45,249)


(25,137)

Equity in net income of affiliates, net of tax


3,840


5,219


2,652

Net income


81,269


78,047


25,050

Net income attributable to non-controlling








 and other beneficial interests


(3,334)


(3,146)


(1,847)

Net income attributable to








Eaton Vance Corp. shareholders

$

77,935

$

74,901

$

23,203

Adjusted net income attributable to Eaton








Vance Corp. shareholders(1)

$

77,876

$

74,901

$

66,513









Earnings per diluted share

$

0.63

$

0.59

$

0.18









Adjusted earnings per diluted share(1)

$

0.63

$

0.59

$

0.52

Third Quarter Fiscal 2014 vs. Third Quarter Fiscal 2013

In the third quarter of fiscal 2014, revenue increased 5 percent to $367.6 million from revenue of $350.4 million in the third quarter of fiscal 2013.  Investment advisory and administrative fees were up 6 percent, reflecting a 10 percent increase in average consolidated assets under management and lower average effective fee rates. Performance fees contributed $0.9 million to investment advisory and administrative fees, unchanged from the third quarter of fiscal 2013. Distribution and service fee revenues were collectively down 3 percent, reflecting lower managed assets in fund share classes that are subject to distribution and service fees.

Operating expenses increased 2 percent to $236.4 million in the third quarter of fiscal 2014 from $231.5 million in the third quarter of fiscal 2013, reflecting increases in compensation, service fee expense, fund-related expenses and other operating expenses, offset by reduced amortization of deferred sales commissions. The increase in compensation expense reflects increases in stock-based compensation, higher employee headcount and increases in base salaries and benefits, offset by lower operating income-based bonus accruals and a decrease in sales-based incentives. The increase in service fee expense reflects an increase in average assets under management subject to service fee payments.  The increase in fund-related expenses primarily reflects an increase in sub-advisory expenses for Company-sponsored funds managed by unaffiliated sub-advisors. Other expenses increased 4 percent, reflecting increases in travel and information technology expenses.  The decrease in amortization of deferred sales commissions largely reflects decreases in Class B share and Class C share amortization.  Distribution expense was flat year-over-year, reflecting the non-recurrence of $1.7 million in closed-end fund-related structuring fees paid in the third quarter of fiscal 2013, offset by an increase in intermediary marketing support payments.

Operating income was up 10 percent to $131.2 million in the third quarter of fiscal 2014 from $118.9 million in the third quarter of fiscal 2013.  Operating margin improved to 35.7 percent in the third quarter of fiscal 2014 from 33.9 percent in the third quarter of fiscal 2013.

Non-operating expense totaled $4.9 million in the third quarter of fiscal 2014 compared to $71.3 million in the third quarter of fiscal 2013. The year-over-year change reflects $56.9 million in costs incurred on the retirement of $250 million of the Company's 2017 Senior Notes in the third quarter of fiscal 2013, a $7.9 million positive change in gains (losses) and other investment income related to the Company's investments in sponsored products, a decrease of $1.7 million in interest expense and a $0.9 million decline in income (expense) of the Company's consolidated collateralized loan obligation ("CLO") entities.

The Company's effective tax rate, calculated as a percentage of income before income taxes and equity in net income of affiliates, was 38.7 percent in the third quarter of fiscal 2014. Excluding the impact of consolidated CLO entities' income (expense) borne by other beneficial interest holders, the Company's effective tax rate was 38.5 percent for the quarter. During the third quarter of fiscal 2013, the Company settled a multi-year state tax audit, the net impact of which was an increase to income tax expense of $6.7 million

Equity in net income of affiliates increased to $3.8 million in the third quarter of fiscal 2014 from $2.7 million in the third quarter of fiscal 2013.  Equity in net income of affiliates in the third quarter of fiscal 2014 included $2.9 million of Company equity in the net income of Hexavest and $0.9 million of gains (losses) and other income on the Company's investments in sponsored funds.  Equity in net income of affiliates in the third quarter of fiscal 2013 included $2.5 million of Company equity in the net income of Hexavest and $0.1 million of net income in a private equity partnership. 

Net income attributable to non-controlling and other beneficial interests was $3.3 million in the third quarter of fiscal 2014 compared to $1.8 million in the third quarter of fiscal 2013. As shown in Attachment 3, net income attributable to non-controlling and other beneficial interests included non-controlling interest value adjustments relating to our majority-owned subsidiaries of -$0.1 million and $0.4 million in the third quarter of fiscal 2014 and 2013, respectively. The year-over-year change also reflects a decrease in the net income (loss) attributable to non-controlling interest holders of the Company's consolidated CLO entities.

Third Quarter Fiscal 2014 vs. Second Quarter Fiscal 2014

In the third quarter of fiscal 2014, revenue increased 4 percent to $367.6 million from revenue of $354.1 million in the second quarter of fiscal 2014.  Investment advisory and administrative fees were up 4 percent, reflecting a 2 percent increase in average consolidated assets under management and slightly higher average effective fee rates driven by an increase in the number of fee days in the quarter. Performance fees contributed $0.9 million and $1.0 million to investment advisory and administrative fees in the third and second quarters of fiscal 2014, respectively. Distribution and service fee revenues were up 3 percent in aggregate, reflecting an increase in managed assets in fund share classes that are subject to distribution and service fees.

Operating expenses increased 3 percent to $236.4 million in the third quarter of fiscal 2014 from $228.8 million in the second quarter of fiscal 2014, reflecting increases in compensation, distribution and service fee expenses, fund-related expenses and other operating expenses, offset by reduced amortization of deferred sales commissions. The increase in compensation expense reflects an increase in base salaries, driven by an increase in payroll days in the current quarter, and an increase in stock-based compensation, offset by lower operating income-based bonus accruals. The increase in distribution and service fee expense reflects increased average assets under management subject to those fees. The increase in fund-related expenses can be attributed to an increase in expenses borne by the Company on funds for which it receives an all-in fee, as well as other fund-related expenses. Other expenses increased 4 percent, reflecting an increase in information technology expenses offset by a decrease in professional expenses. The decrease in amortization of deferred sales commissions reflects a decrease in Class C share amortization.

Operating income was up 5 percent to $131.2 million in the third quarter of fiscal 2014 from $125.3 million in the second quarter of fiscal 2014.  Operating margin improved to 35.7 percent in the third quarter of fiscal 2014 from 35.4 percent in the second quarter of fiscal 2014.

Non-operating expense totaled $4.9 million in the third quarter of fiscal 2014 compared to $7.2 million in the second quarter of fiscal 2014, reflecting a $3.7 million positive change in gains (losses) and other investment income related to the Company's investments in sponsored products. 

Equity in net income of affiliates decreased to $3.8 million in the third quarter of fiscal 2014 from $5.2 million in the second quarter of fiscal 2014.  Equity in net income of affiliates included $2.9 million of Company equity in the net income of Hexavest and $0.9 million of gains (losses) and other income on the Company's investments in sponsored funds in the third quarter of fiscal 2014.  Equity in net income of affiliates included $2.6 million of Company equity in the net income of Hexavest, $2.2 million of gains (losses) and other income on the Company's investments in sponsored funds and $0.4 million of net income in a private equity partnership in the second quarter of fiscal 2014. 

Net income attributable to non-controlling and other beneficial interests was $3.3 million in the third quarter of fiscal 2014 and $3.1 million in the second quarter of fiscal 2014.

Weighted average diluted shares outstanding decreased 2.0 million shares, or 2 percent, in the third quarter of fiscal 2014 from the second quarter of fiscal 2014, primarily reflecting the impact of share repurchases.  During the third quarter of fiscal 2014 the Company issued 0.5 million shares of restricted and unrestricted Non-Voting Common Stock in connection with granting incentive equity awards and the exercise of employee stock options. Over the same period, the Company used $92.6 million to repurchase and retire 2.5 million shares of its Non-Voting Common Stock.

Balance Sheet Information

Cash and cash equivalents totaled $362.0 million on July 31, 2014, with no outstanding borrowings against the Company's $300 million credit facility.  Included within investments is $186.8 million of short-term debt securities with maturities between 90 days and one year.  During the first nine months of fiscal 2014, the Company used $227.9 million to repurchase and retire 6.0 million shares of its Non-Voting Common Stock under its repurchase authorizations.  Of the current 8.0 million share repurchase authorization, approximately 7.2 million shares remain available.


Conference Call Information

Eaton Vance Corp. will host a conference call and webcast at 11:00 AM eastern time today to discuss the financial results for the three and nine months ended July 31, 2014. To participate in the conference call, please call 877-201-0168 (domestic) or 647-788-4901 (international) and refer to "Eaton Vance Corp. Third Fiscal Quarter Earnings." Listeners to the conference call must enter the confirmation code 87504388.  A webcast of the conference call can also be accessed via Eaton Vance's website, www.eatonvance.com

A replay of the call will be available for one week by calling 855-859-2056 (domestic) or 404-537-3406 (international) or by accessing Eaton Vance's website, www.eatonvance.com. Listeners to the telephone replay must enter the confirmation code 87504388.

About Eaton Vance Corp.

Eaton Vance Corp. is one of the oldest investment management firms in the United States, with a history dating back to 1924. Eaton Vance and its affiliates offer individuals and institutions a broad array of investment strategies and wealth management solutions.  The Company's long record of providing exemplary service, timely innovation and attractive returns through a variety of market conditions has made Eaton Vance the investment manager of choice for many of today's most discerning investors.  For more information about Eaton Vance, visit www.eatonvance.com.

Forward-Looking Statements

This news release may contain statements that are not historical facts, referred to as "forward-looking statements."  The Company's actual future results may differ significantly from those stated in any forward-looking statements, depending on factors such as changes in securities or financial markets or general economic conditions, client sales and redemption activity, the continuation of investment advisory, administration, distribution and service contracts, and other risks discussed in the Company's filings with the Securities and Exchange Commission.


















Attachment 1

Eaton Vance Corp.

Summary of Results of Operations

(in thousands, except per share figures)












































Three Months Ended


Nine Months Ended










%

%

















Change

Change

















Q3 2014

Q3 2014











July 31,

April 30,

July 31,

vs.

vs.


July 31,

July 31,

%




2014

2014

2013

Q2 2014

Q3 2013


2014

2013

Change

Revenue:






































Investment advisory and administrative fees

$

311,756

$

300,136

$

293,589

4

%

6

%


$

916,605

$

833,791

10

%


Distribution and underwriter fees


21,548


21,212


22,681

2


(5)




64,381


67,597

(5)



Service fees


31,977


30,829


32,259

4


(1)




95,097


94,521

1



Other revenue


2,309


1,884


1,832

23


26




5,829


4,661

25




Total revenue


367,590


354,061


350,361

4


5




1,081,912


1,000,570

8


Expenses:






































Compensation and related costs


117,632


114,656


115,379

3


2




351,110


334,220

5



Distribution expense


35,591


34,785


35,452

2


-




105,924


104,645

1



Service fee expense


29,780


28,281


29,013

5


3




87,266


86,488

1



Amortization of deferred sales commissions


4,084


4,354


4,983

(6)


(18)




13,408


14,518

(8)



Fund-related expenses


9,380


8,455


8,230

11


14




26,288


23,728

11



Other expenses


39,945


38,227


38,454

4


4




117,235


109,371

7




Total expenses


236,412


228,758


231,511

3


2




701,231


672,970

4


Operating income


131,178


125,303


118,850

5


10




380,681


327,600

16


Non-operating income (expense):



















Gains (losses) and other investment



















income, net


2,917


(738)


(8,027)

NM


NM




2,592


2,223

17



Interest expense


(7,443)


(7,404)


(9,167)

1


(19)




(22,247)


(26,309)

(15)



Loss on extinguishment of debt


-


-


(52,886)

-


NM




-


(52,886)

NM



Other income (expense) of consolidated



















CLO entities:




















     Gains and other investment income, net

1,434


5,104


1,704

(72)


(16)




15,247


7,881

93




     Interest and other expense


(1,758)


(4,188)


(2,939)

(58)


(40)




(13,781)


(10,211)

35




Total non-operating expense


(4,850)


(7,226)


(71,315)

(33)


(93)




(18,189)


(79,302)

(77)






















Income before income taxes and equity


















   in net income of affiliates

126,328


118,077


47,535

7


166




362,492


248,298

46


Income taxes


(48,899)


(45,249)


(25,137)

8


95




(138,790)


(99,270)

40


Equity in net income of affiliates, net of tax


3,840


5,219


2,652

(26)


45




12,344


9,269

33


Net income


81,269


78,047


25,050

4


224




236,046


158,297

49


Net income attributable to non-controlling

















   and other beneficial interests


(3,334)


(3,146)


(1,847)

6


81




(11,852)


(21,608)

(45)


Net income attributable to


















   Eaton Vance Corp. Shareholders

$

77,935

$

74,901

$

23,203

4


236



$

224,194

$

136,689

64






















Earnings per share:


















Basic

$

0.66

$

0.62

$

0.19

6


247



$

1.86

$

1.12

66



Diluted

$

0.63

$

0.59

$

0.18

7


250



$

1.78

$

1.07

66






















Weighted average shares outstanding:

















Basic


116,145


118,103


117,594

(2)


(1)




117,248


116,399

1



Diluted


121,013


123,021


123,872

(2)


(2)




122,550


122,155

-






















Dividends declared per share:



















Regular

$

0.22

$

0.22

$

0.20

-


10



$

0.66

$

0.60

10



Special

$

-

$

-

$

-

-


-



$

-

$

1.00

NM


 

































Attachment 2

Eaton Vance Corp.


Reconciliation of net income attributable to Eaton Vance Corp.


shareholders to adjusted net income attributable to Eaton Vance Corp.


shareholders and earnings per diluted share to adjusted earnings per diluted share









































Three Months Ended


Nine Months Ended









% Change

% Change









July 31,

April 30,

July 31,

Q3 2014 vs.

Q3 2014 vs.


July 31,

July 31,

%

(in thousands, except per share figures)

2014

2014

2013

Q2 2014

Q3 2013


2014

2013

Change




















Net income attributable to Eaton



















Vance Corp. shareholders

$

77,935

$

74,901

$

23,203

4

%

236

%


$

224,194

$

136,689

64

%



















Non-controlling interest value



















adjustments


(59)


-


405

NM


NM




2,330


11,718

(80)




















Closed-end fund structuring fees,



















net of tax


-


-


1,043

-


NM




-


2,720

NM




















Loss on extinguishment of debt, net of tax*


-


-


35,171

-


NM




-


35,171

NM




















Settlement of state tax audit


-


-


6,691

-


NM




-


6,691

NM




















Adjusted net income attributable to



















Eaton Vance Corp. shareholders

$

77,876

$

74,901

$

66,513

4


17



$

226,524

$

192,989

17
























































Earnings per diluted share

$

0.63

$

0.59

$

0.18

7


250



$

1.78

$

1.07

66




















Non-controlling interest value



















adjustments


-


-


-

-


-




0.02


0.09

(78)




















Closed-end fund structuring fees,


















net of tax


-


-


0.01

-


NM




-


0.02

NM




















Loss on extinguishment of debt, net of tax


-


-


0.28

-


NM




-


0.28

NM




















Settlement of state tax audit


-


-


0.05

-


NM




-


0.05

NM




















Special dividend adjustment


-


-


-

-


-




-


0.02

NM





















Adjusted earnings per diluted share

$

0.63

$

0.59

$

0.52

7


21



$

1.80

$

1.53

18






















* The loss on extinguishment of debt is comprised of a $52.9 million loss on extinguishment of debt, a $3.1 million loss on a reverse treasury lock entered into in


   conjunction with the retirement of debt and $0.9 million of additional interest related to the accelerated amortization of a treasury lock tied to the retired portion of the debt.



































Attachment 3

Eaton Vance Corp.


Components of net income attributable


to non-controlling and other beneficial interests










































Three Months Ended


Nine Months Ended









% Change

% Change










July 31,

April 30,

July 31,

Q3 2014 vs.

Q3 2014 vs.


July 31,

July 31,

%

(in thousands)

2014

2014

2013

Q2 2014

Q3 2013


2014

2013

Change




















Consolidated funds

$

42

$

413

$

(206)

(90)

%

NM

%


$

259

$

3,886

(93)

%



















Majority-owned subsidiaries


4,261


3,524


4,007

21


6




11,268


11,596

(3)





















Non-controlling interest value



















adjustments


(59)


-


405

NM


NM




2,330


11,718

(80)




















Consolidated CLO entities


(910)


(791)


(2,359)

15


(61)




(2,005)


(5,592)

(64)





















Net income attributable to non-controlling



















and other beneficial interests

$

3,334

$

3,146

$

1,847

6


81



$

11,852

$

21,608

(45)


 







Attachment 4

Eaton Vance Corp.


Balance Sheet


(in thousands, except per share figures)








July 31,




October 31,




2014




2013


Assets
























Cash and cash equivalents

$

362,017



$

461,906


Investment advisory fees and other receivables


171,403




170,220


Investments


642,475




536,323


Assets of consolidated collateralized loan obligation ("CLO") entities:








          Cash and cash equivalents


21,074




36,641


          Bank loans and other investments


166,025




685,681


          Other assets


2,179




5,814


Deferred sales commissions


16,966




17,923


Deferred income taxes


53,014




61,139


Equipment and leasehold improvements, net


46,247




48,746


Intangible assets, net


67,457




74,534


Goodwill


228,876




228,876


Other assets


58,355




79,446


   Total assets

$

1,836,088



$

2,407,249










Liabilities, Temporary Equity and Permanent Equity
















Liabilities:
















Accrued compensation

$

142,147



$

169,953


Accounts payable and accrued expenses


69,022




58,529


Dividend payable


26,547




26,740


Debt


573,616




573,499


Liabilities of consolidated CLO entities:








          Senior and subordinated note obligations


182,725




279,127


          Line of credit


-




247,789


          Redeemable preferred shares


-




64,952


          Other liabilities


389




124,305


Other liabilities


72,437




115,960


   Total liabilities


1,066,883




1,660,854


Commitments and contingencies
















Temporary Equity:








Redeemable non-controlling interests


99,966




74,856


   Total temporary equity


99,966




74,856










Permanent Equity:








Voting Common Stock, par value $0.00390625 per share:








   Authorized, 1,280,000 shares








   Issued and outstanding, 415,078 and 399,240 shares, respectively


2




2


Non-Voting Common Stock, par value $0.00390625 per share:








   Authorized, 190,720,000 shares








   Issued and outstanding, 118,320,698 and 121,232,506 shares, respectively


462




474


Additional paid-in capital


-




124,837


Notes receivable from stock option exercises


(7,569)




(7,122)


Accumulated other comprehensive loss


(4,508)




(177)


Appropriated retained earnings


4,557




10,249


Retained earnings


674,492




541,521


   Total Eaton Vance Corp. shareholders' equity


667,436




669,784


Non-redeemable non-controlling interests


1,803




1,755


   Total permanent equity


669,239




671,539


Total liabilities, temporary equity and permanent equity

$

1,836,088



$

2,407,249










 















Attachment 5

 Eaton Vance Corp.

 Consolidated Net Flows by Investment Mandate(1)

 (in millions)



















Three Months Ended


Nine Months Ended



July 31,


April 30,


July 31,


July 31,


July 31,



2014


2014


2013


2014


2013

 Equity assets - beginning of period(2)

$

93,733


$

90,765


$

89,534


$

93,585


$

80,782


Sales and other inflows


3,465



3,669



4,056



10,920



13,823


Redemptions/outflows


(4,129)



(5,015)



(4,185)



(14,766)



(14,135)


  Net flows


(664)



(1,346)



(129)



(3,846)



(312)


Assets acquired(3)


-



-



-



-



1,572


Exchanges


468



20



46



1,000



162


Market value change


2,517



4,294



1,323



5,315



8,570

 Equity assets - end of period

$

96,054


$

93,733


$

90,774


$

96,054


$

90,774

 Fixed income assets - beginning of period(4)


43,917



43,339



49,949



44,211



49,003


Sales and other inflows


3,344



2,626



2,065



8,420



8,732


Redemptions/outflows


(3,299)



(2,756)



(3,595)



(9,336)



(10,318)


  Net flows


45



(130)



(1,530)



(916)



(1,586)


Assets acquired(3)


-



-



-



-



472


Exchanges


59



62



(277)



23



(358)


Market value change


266



646



(2,321)



969



(1,710)

 Fixed income assets - end of period

$

44,287


$

43,917


$

45,821


$

44,287


$

45,821

 Floating-rate income assets - beginning of period


45,115



44,073



33,679



41,821



26,388


Sales and other inflows


4,139



4,170



6,636



13,094



15,987


Redemptions/outflows


(5,491)



(2,842)



(2,152)



(11,037)



(4,664)


  Net flows


(1,352)



1,328



4,484



2,057



11,323


Exchanges


(62)



(49)



169



(57)



251


Market value change


51



(237)



(162)



(69)



208

 Floating-rate income assets - end of period

$

43,752


$

45,115


$

38,170


$

43,752


$

38,170

 Alternative assets -  beginning of period


12,112



13,171



16,022



15,212



12,864


Sales and other inflows


774



767



2,348



2,630



6,925


Redemptions/outflows


(1,208)



(1,967)



(1,770)



(6,164)



(3,785)


  Net flows


(434)



(1,200)



578



(3,534)



3,140


Assets acquired(3)


-



-



-



-



650


Exchanges


(15)



(20)



(22)



(84)



(138)


Market value change


28



161



(480)



97



(418)

 Alternative assets - end of period

$

11,691


$

12,112


$

16,098


$

11,691


$

16,098

 Implementation services assets - beginning of period


90,815



87,010



70,966



85,637



30,302


Sales and other inflows


14,429



11,549



12,933



43,399



26,663


Redemptions/outflows


(14,053)



(11,105)



(7,504)



(41,168)



(18,396)


  Net flows


376



444



5,429



2,231



8,267


Assets acquired(3)


-



-



-



-



32,064


Exchanges


(456)



(5)



-



(913)



(14)


Market value change


1,488



3,366



1,278



5,268



7,054

 Implementation services assets - end of period

$

92,223


$

90,815


$

77,673


$

92,223


$

77,673

 Total long-term fund and separate account
















assets - beginning of period


285,692



278,358



260,150



280,466



199,339


Sales and other inflows


26,151



22,781



28,038



78,463



72,130


Redemptions/outflows


(28,180)



(23,685)



(19,206)



(82,471)



(51,298)


  Net flows


(2,029)



(904)



8,832



(4,008)



20,832


Assets acquired(3)


-



-



-



-



34,758


Exchanges


(6)



8



(84)



(31)



(97)


Market value change


4,350



8,230



(362)



11,580



13,704

 Total long-term fund and separate account
















assets - end of period

$

288,007


$

285,692


$

268,536


$

288,007


$

268,536

 Cash management fund assets - end of period


187



177



219



187



219

 Total assets under management - end of period

$

288,194


$

285,869


$

268,755


$

288,194


$

268,755

















(1)  Consolidated Eaton Vance Corp.  See Attachment 9 for managed assets and flows of 49 percent-owned Hexavest Inc.

(2)  Includes assets in balanced accounts holding income securities.

(3)  Represents assets gained in the acquisition of The Clifton Group Investment Management Company on December 31, 2012.

(4)  Includes assets in institutional cash management separate accounts.

 














Attachment 6

 Eaton Vance Corp.

 Consolidated Net Flows by Investment Vehicle(1)

 (in millions)




Three Months Ended


Nine Months Ended



July 31,


April 30,


July 31,


July 31,


July 31,



2014


2014


2013


2014


2013

 Long-term fund assets - beginning of period

$

134,942


$

131,984


$

127,014


$

133,198


$

113,249


Sales and other inflows


8,634



8,684



11,597



27,551



33,307


Redemptions/outflows


(10,272)



(8,751)



(7,932)



(29,284)



(21,316)


  Net flows


(1,638)



(67)



3,665



(1,733)



11,991


Assets acquired(2)


-



-



-



-



638


Exchanges


(6)



81



(241)



41



(262)


Market value change


1,671



2,944



(1,396)



3,463



3,426

 Long-term fund assets - end of period

$

134,969


$

134,942


$

129,042


$

134,969


$

129,042

 Institutional separate account assets -
















beginning of period(3)


96,564



94,869



84,724



95,724



43,338


Sales and other inflows


14,717



11,101



13,480



42,620



28,366


Redemptions/outflows


(14,912)



(12,249)



(8,901)



(44,632)



(21,792)


  Net flows


(195)



(1,148)



4,579



(2,012)



6,574


Assets acquired(2)


-



-



-



-



34,120


Exchanges


377



(96)



152



280



157


Market value change


1,647



2,939



18



4,401



5,284

 Institutional separate account assets -
















end of period

$

98,393


$

96,564


$

89,473


$

98,393


$

89,473

 High-net-worth separate account assets -
















beginning of period


20,968



19,374



18,027



19,699



15,036


Sales and other inflows


794



968



1,055



2,476



3,931


Redemptions/outflows


(953)



(988)



(614)



(3,045)



(2,385)


  Net flows


(159)



(20)



441



(569)



1,546


Exchanges


(433)



402



(9)



(30)



(16)


Market value change


475



1,212



612



1,751



2,505

 High-net-worth separate account assets -
















end of period

$

20,851


$

20,968


$

19,071


$

20,851


$

19,071

 Retail managed account assets -
















beginning of period


33,218



32,131



30,385



31,845



27,716


Sales and other inflows


2,006



2,028



1,906



5,816



6,526


Redemptions/outflows


(2,043)



(1,697)



(1,759)



(5,510)



(5,805)


  Net flows


(37)



331



147



306



721


Exchanges


56



(379)



14



(322)



24


Market value change


557



1,135



404



1,965



2,489

 Retail managed account assets -
















end of period

$

33,794


$

33,218


$

30,950


$

33,794


$

30,950

 Total long-term fund and separate account
















assets - beginning of period


285,692



278,358



260,150



280,466



199,339


Sales and other inflows


26,151



22,781



28,038



78,463



72,130


Redemptions/outflows


(28,180)



(23,685)



(19,206)



(82,471)



(51,298)


  Net flows


(2,029)



(904)



8,832



(4,008)



20,832


Assets acquired(2)


-



-



-



-



34,758


Exchanges


(6)



8



(84)



(31)



(97)


Market value change


4,350



8,230



(362)



11,580



13,704

 Total long-term fund and separate account
















assets - end of period

$

288,007


$

285,692


$

268,536


$

288,007


$

268,536

 Cash management fund assets -
















end of period


187



177



219



187



219

 Total assets under management -
















end of period

$

288,194


$

285,869


$

268,755


$

288,194


$

268,755


















(1)   Consolidated Eaton Vance Corp.  See Attachment 9 for managed assets and flows of 49 percent-owned Hexavest Inc.

(2)   Represents assets gained in the acquisition of The Clifton Group Investment Management Company on December 31, 2012.

(3)   Includes assets in institutional cash management separate accounts.

 













Attachment 7

 Eaton Vance Corp.

 Consolidated Assets under Management by Investment Affiliate (1)

 (in millions)


















July 31,



April 30,


%



July 31,


%




2014



2014


Change



2013


Change

 Eaton Vance Management(2)

$

143,337


$

144,892


-1%


$

143,229


0%

 Parametric


126,777



122,562


3%



107,192


18%

 Atlanta Capital


18,080



18,415


-2%



18,334


-1%

 Total

$

288,194


$

285,869


1%


$

268,755


7%















(1)   Consolidated Eaton Vance Corp. See Attachment 9 for managed assets and flows of 49 percent-owned Hexavest.

(2)   Includes managed assets of wholly owned subsidiaries Eaton Vance Investment Counsel and Fox Asset Management

       LLC, as well as certain Eaton Vance-sponsored funds and accounts managed by Hexavest and unaffiliated third-party

       advisors under Eaton Vance supervision.




























Attachment 8

 Eaton Vance Corp.

 Consolidated Assets under Management by Investment Mandate (1)

 (in millions)


















July 31,



April 30,


%



July 31,


%




2014



2014


Change



2013


Change

 Equity(2)

$

96,054


$

93,733


2%


$

90,774


6%

 Fixed income(3)


44,287



43,917


1%



45,821


-3%

 Floating-rate income


43,752



45,115


-3%



38,170


15%

 Alternative


11,691



12,112


-3%



16,098


-27%

 Implementation services


92,223



90,815


2%



77,673


19%

 Cash management funds


187



177


6%



219


-15%

 Total

$

288,194


$

285,869


1%


$

268,755


7%















(1)   Consolidated Eaton Vance Corp. See Attachment 9 for managed assets and flows of 49 percent-owned Hexavest.

(2)   Includes assets in balanced accounts holding income securities.

(3)   Includes assets in institutional cash management separate accounts.

 

 Attachment 9

 Eaton Vance Corp.

 Hexavest Inc. Assets under Management and Net Flows

 (in millions)





Three Months Ended


Nine Months Ended




July 31,


April 30,


July 31,


July 31,


July 31,




2014


2014


2013


2014


2013

 Eaton Vance distributed:















 Eaton Vance sponsored funds - beginning of period(1)

$

221


$

212


$

161


$

211


$

37


Sales and other inflows


6



12



19



49



130


Redemptions/outflows


(10)



(17)



(6)



(53)



(12)


  Net flows


(4)



(5)



13



(4)



118


Market value change


4



14



(1)



14



18

 Eaton Vance sponsored funds - end of period

$

221


$

221


$

173


$

221


$

173

 Eaton Vance distributed separate accounts -
















beginning of period(2)

$

2,354


$

1,383


$

1,283


$

1,574


$

-


Sales and other inflows


136



307



227



519



1,378


Redemptions/outflows


(122)



(74)



(1)



(201)



(1)


  Net flows


14



233



226



318



1,377


Exchanges


-



624



-



389



-


Market value change


29



114



6



116



138

 Eaton Vance distributed separate accounts -
















end of period

$

2,397


$

2,354


$

1,515


$

2,397


$

1,515

 Total Eaton Vance distributed - beginning of period

$

2,575


$

1,595


$

1,444


$

1,785


$

37


Sales and other inflows


142



319



246



568



1,508


Redemptions/outflows


(132)



(91)



(7)



(254)



(13)


  Net flows


10



228



239



314



1,495


Exchanges


-



624



-



389



-


Market value change


33



128



5



130



156

 Total Eaton Vance distributed - end of period

$

2,618


$

2,575


$

1,688


$

2,618


$

1,688

 Hexavest directly distributed - beginning of period(3)

$

14,477


$

14,543


$

13,831


$

15,136


$

12,073


Sales and other inflows


597



355



785



1,392



2,003


Redemptions/outflows


(904)



(681)



(530)



(2,546)



(1,363)


  Net flows


(307)



(326)



255



(1,154)



640


Exchanges


-



(624)



-



(389)



-


Market value change


253



884



(40)



830



1,333

 Hexavest directly distributed - end of period

$

14,423


$

14,477


$

14,046


$

14,423


$

14,046

 Total Hexavest assets - beginning of period

$

17,052


$

16,138


$

15,275


$

16,921


$

12,110


Sales and other inflows


739



674



1,031



1,960



3,511


Redemptions/outflows


(1,036)



(772)



(537)



(2,800)



(1,376)


  Net flows


(297)



(98)



494



(840)



2,135


Market value change


286



1,012



(35)



960



1,489

 Total Hexavest assets - end of period

$

17,041


$

17,052


$

15,734


$

17,041


$

15,734


















(1)

Managed assets and flows of Eaton Vance-sponsored pooled investment vehicles for which Hexavest is advisor or sub-advisor. Eaton Vance receives management and/or distribution revenue on these assets, which are included in the Eaton Vance consolidated results in Attachments 5, 6, 7 and 8.

(2)

Managed assets and flows of Eaton Vance-distributed separate accounts managed by Hexavest.  Eaton Vance receives distribution revenue, but not investment advisory fees, on these assets, which are not included in the Eaton Vance consolidated results in Attachments 5, 6, 7 and 8.

(3)

Managed assets and flows of pre-transaction Hexavest clients and post-transaction Hexavest clients in Canada. Eaton Vance receives no investment advisory or distribution revenue on these assets, which are not included in the Eaton Vance consolidated results in Attachments 5, 6, 7 and 8.

 


(1) Although the Company reports its financial results in accordance with GAAP, management believes that certain non-GAAP financial measures, while not a substitute for GAAP financial measures, may be effective indicators of the Company's performance over time.  Adjusted net income and adjusted earnings per diluted share reflect the add back of adjustments in connection with changes in the estimated redemption value of non-controlling interests in our affiliates redeemable at other than fair value ("non-controlling interest value adjustments"), closed-end fund structuring fees and other items management deems non-recurring or non-operating, such as special dividends, costs associated with retiring debt and tax settlements.  See reconciliation provided in Attachment 2 for more information on adjusting items.

 

SOURCE Eaton Vance Corp.



RELATED LINKS
http://www.eatonvance.com

Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

 

PR Newswire Membership

Fill out a PR Newswire membership form or contact us at (888) 776-0942.

Learn about PR Newswire services

Request more information about PR Newswire products and services or call us at (888) 776-0942.