Federated Investors, Inc. Reports Third Quarter 2012 Earnings; Board Declares Cash Dividend Per Share of $1.75 Including $0.24 Quarterly and $1.51 Special Dividend

- Equity and fixed-income assets increase $4 billion during Q3 2012 to a record $94 billion

- Assets in strategic-value dividend strategies increase $3.6 billion for YTD 2012 to $13.8 billion

Oct 25, 2012, 16:02 ET from Federated Investors, Inc.

PITTSBURGH, Oct. 25, 2012 /PRNewswire/ -- Federated Investors, Inc. (NYSE: FII), one of the nation's largest investment managers, today reported earnings per diluted share (EPS) of $0.54 for the quarter ended Sept. 30, 2012 as compared to $0.37 for the same quarter last year.  Net income was $55.8 million for Q3 2012 compared to $38.3 million for Q3 2011.  Federated's Q3 2012 financial results include the recognition of insurance proceeds, which reduced pre-tax operating expenses by $17.3 million and increased EPS by $0.11 per share, after tax. Federated reported YTD 2012 EPS of $1.33 compared to $1.09 for the same period in 2011 and net income of  $138.5 million compared to $114.0 million for the same period last year. 

Federated's total managed assets were $364.1 billion at Sept. 30, 2012, up $12.4 billion or 4 percent from $351.7 billion at Sept. 30, 2011 and up $8.2 billion or 2 percent from $355.9 billion reported at June 30, 2012.  Average managed assets for Q3 2012 were $360.9 billion, up $12.1 billion or 3 percent from $348.8 billion reported for Q3 2011 and up $0.3 billion from $360.6 billion reported for Q2 2012.  Net sales of equity and fixed-income funds and separate accounts were $1.9 billion for Q3 2012. 

"Federated continued to see client demand for our dividend-paying equity portfolios with more than $2.5 billion in net sales in those products in the first nine months of the year," said J. Christopher Donahue, president and chief executive officer.  "On the international side, Federated made significant moves to grow our global profile by hiring an executive to lead our new Asia Pacific initiative and expanding our European distribution capabilities through an agreement with Bury Street Capital, a successful European distribution firm based in London."

Federated's board of directors declared a dividend of $1.75 per share. The dividend, which will be paid from Federated's existing cash balance, is considered an ordinary dividend for tax purposes and consists of a $0.24 quarterly dividend and a $1.51 special dividend.  The dividend is payable on Nov. 15, 2012 to shareholders of record as of Nov. 8, 2012.  The special dividend is expected to decrease EPS for Q4 2012 by approximately $0.04 and for full-year 2012 by approximately $0.02 due to the application of the two-class method of calculating EPS.  During Q3 2012, Federated purchased 152,244 shares of Federated class B common stock for $3.0 million.

"The payment of the November special dividend returns cash to shareholders and is a recognition that Federated's business mix of equity, fixed-income and money market strategies allows the company to continue to succeed in challenging markets," said Thomas R. Donahue, chief financial officer.

Federated's equity assets were $35.4 billion at Sept. 30, 2012, up $7.4 billion or 26 percent from $28.0 billion at Sept. 30, 2011 and up $2.2 billion or 7 percent from $33.2 billion at June 30, 2012.  Top-selling equity funds during Q3 2012 on a net basis were Federated Strategic Value Dividend Fund, Federated International Strategic Value Dividend Fund, Federated Capital Income Fund, Federated Managed Volatility Fund II and Federated Clover Small Value Fund. 

Federated's fixed-income assets were a record $51.4 billion at Sept. 30, 2012, up $8.5 billion or 20 percent from $42.9 billion at Sept. 30, 2011 and up $2.4 billion or 5 percent from $49.0 billion at June 30, 2012.  Fixed-income assets in liquidation portfolios were $7.7 billion at Sept. 30, 2012.  Fixed-income sales were driven by strong net flows into Federated Institutional High Yield Bond Fund, Federated's Capital Preservation Fund, Federated Municipal Ultrashort Fund, Federated Short-Intermediate Duration Municipal Trust and Federated Strategic Income Fund.

Money market assets in both funds and separate accounts were $269.6 billion at Sept. 30, 2012, down $2.1 billion or 1 percent from $271.7 billion at Sept. 30, 2011 and up $4.1 billion or 2 percent from $265.5 billion at June 30, 2012.  Money market mutual fund assets were $244.8 billion at Sept. 30, 2012, down $0.5 billion from $245.3 billion at Sept. 30, 2011 and up $6.2 billion or 3 percent from $238.6 billion at June 30, 2012.  Additionally, Federated announced in July that the commonwealth of Massachusetts had selected the company to manage two pools of assets with more than $9 billion in liquidity and short-term bond assets. Federated is expected to begin managing those assets in early 2013.

Financial Summary

Q3 2012 vs. Q3 2011

Revenue increased by $24.4 million or 11 percent due primarily to a decrease of $19.4 million in voluntary fee waivers related to certain money market funds in order for these funds to maintain positive or zero net yields. The reduction in fee waivers was primarily the result of improved yields available on securities held by money market funds.  In addition, revenue increased due to an increase in average fixed-income and equity assets.  See additional information about voluntary fee waivers in the table at the end of this financial summary. 

During Q3 2012, Federated derived 52 percent of its revenue from equity and fixed-income assets (31 percent from equity assets and 21 percent from fixed-income assets), 47 percent from money market assets and 1 percent from other products and services.

Operating expenses increased $1.4 million or 1 percent primarily as a result of an increase in distribution expense related primarily to reduced fee waivers and increased compensation and related expense. These increases were offset by the aforementioned recognition of insurance proceeds recorded as a reduction to professional service fees.

Q3 2012 vs. Q2 2012

Revenue increased by $6.3 million or 3 percent primarily due to one additional day in the quarter, an increase in average fixed-income and equity assets and a decrease in the aforementioned voluntary fee waivers due mainly to improved yields available on securities held by money market funds.  

Operating expenses decreased by $14.7 million or 9 percent primarily related to the aforementioned recognition of insurance proceeds.

YTD 2012 vs. YTD 2011

Revenue for the first nine months of 2012 increased by $22.2 million, or 3 percent compared to the first nine months of 2011.  The increase in revenue was primarily related to an increase in average fixed-income assets and decrease in the aforementioned voluntary fee waivers primarily as a result of improved yields available on securities held by money market funds partially offset by higher average money market fund assets.  These revenue increases were partially offset by a decrease due to a change in the mix of average equity assets. 

For the first nine months of 2012, Federated derived 52 percent of its revenue from equity and fixed-income assets (31 percent from equity assets and 21 percent from fixed-income assets), 47 percent from money market assets and 1 percent from other products and services.

Operating expenses for the first nine months of 2012 decreased by $11.6 million or 2 percent compared to the same period last year.  The decrease primarily reflects lower professional service fees due to the aforementioned recognition of insurance proceeds and nonrecurring legal expenses incurred in Q1 2011. This decrease was partially offset by increases in distribution and compensation and related expenses. 

Federated's level of business activity and financial results are dependent upon many factors including market conditions, investment performance and investor behavior.  These factors and others including asset levels, product sales and redemptions, market appreciation or depreciation, revenues, fee waivers and expenses can impact Federated's activity levels and financial results significantly.  Risk factors and uncertainties that can influence Federated's financial results are discussed in the company's annual and quarterly reports as filed with the Securities and Exchange Commission.

Fee waivers to maintain positive or zero net yields could vary significantly in the future as they are contingent on a number of variables including, but not limited to, changes in assets within the money market funds, available yields on instruments held by the money market funds, actions by the Federal Reserve, the U.S. Department of the Treasury and other governmental entities, changes in expenses of the money market funds, changes in the mix of money market customer assets, Federated's willingness to continue the fee waivers and changes in the extent to which the impact of the waivers is shared by third parties.

 

Money Market Fund Yield Waiver Impact

(in millions)

Quarter Ended

Change Q3 2011 to Q3 2012

Quarter Ended

Change Q2 2012 to Q3 2012

Nine Months Ended

Change YTD 2011 to YTD 2012

(Decrease)/Increase

Sept. 30, 2012

Sept. 30, 2011

June 30, 2012

Sept. 30, 2012

Sept. 30, 2011

Investment advisory fees

$

(41.2)

$

(57.2)

$

16.0

$

(43.0)

$

1.8

$

(137.2)

$

(142.8)

$

5.6

Other service fees

(28.3)

(31.7)

3.4

(27.3)

(1.0)

(83.0)

(88.9)

5.9

Total Revenue

$

(69.5)

$

(88.9)

$

19.4

$

(70.3)

$

0.8

$

(220.2)

$

(231.7)

$

11.5

Distribution expense

(52.9)

(63.2)

10.3

(53.1)

0.2

(163.6)

(170.5)

6.9

Operating income

$

(16.6)

$

(25.7)

$

9.1

$

(17.2)

$

0.6

$

(56.6)

$

(61.2)

$

4.6

Noncontrolling interest

(0.3)

(2.5)

2.2

0.0

(0.3)

(0.9)

(5.5)

4.6

Pre-tax impact

$

(16.3)

$

(23.2)

$

6.9

$

(17.2)

$

0.9

$

(55.7)

$

(55.7)

$

0.0

Federated will host an earnings conference call at 9 a.m. Eastern on Oct. 26, 2012.  Investors are invited to listen to Federated's earnings teleconference by calling 877-407-0782 (domestic) or 201-689-8567 (international) prior to the 9 a.m. start time.  The call may also be accessed in real time on the Internet via the About Federated section of FederatedInvestors.com.  A replay will be available after 12:30 p.m. and through Nov. 2, 2012 by calling 877-660-6853 (domestic) or 201-612-7415 (international) and entering access code 401060.

Federated Investors, Inc. is one of the largest investment managers in the United States, managing $364.1 billion in assets as of Sept. 30, 2012.  With 136 funds and a variety of separately managed account options, Federated provides comprehensive investment management to approximately 4,700 institutions and intermediaries including corporations, government entities, insurance companies, foundations and endowments, banks and broker/dealers.  Federated ranks in the top 3 percent of money market fund managers in the industry, the top 7 percent of equity fund managers and the top 7 percent of fixed-income fund managers1.  For more information, visit FederatedInvestors.com.

1 Strategic Insight, Aug. 31, 2012.  Based on assets under management in open-end funds.

Federated Securities Corp. is distributor of the Federated funds. 

Separately managed accounts are made available through Federated Global Investment Management Corp., Federated Investment Counseling and Federated MDTA LLC, each a registered investment adviser.

Certain statements in this press release, such as those related to the level of fee waivers incurred by the company, product demand and asset flows, growth opportunities, and expected impact of the dividend to EPS, constitute or may constitute forward-looking statements, which involve known and unknown risks, uncertainties and other factors that may cause the actual results, levels of activity, performance or achievements of the company, or industry results, to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements.  Other risks and uncertainties include the ability of the company to predict the level of fee waivers in future quarters, which could vary significantly depending on a variety of factors identified above, and include the ability of the company to sustain product demand and asset flows or achieve new growth opportunities, which could vary significantly depending on market conditions, investment performance and investor behavior.  Other risks and uncertainties also include the risk factors discussed in the company's annual and quarterly reports as filed with the Securities and Exchange Commission.  As a result, no assurance can be given as to future results, levels of activity, performance or achievements, and neither the company nor any other person assumes responsibility for the accuracy and completeness of such statements in the future.

 

Unaudited Condensed Consolidated Statements of Income

(in thousands, except per share data)

Quarter Ended

% Change Q3 2011 to Q3 2012

Quarter Ended

% Change

Q2 2012

 to Q3 2012

Sept. 30, 2012

Sept. 30, 2011

June 30, 2012

Revenue

Investment advisory fees, net

$

160,306

$

139,399

15

%

$

154,367

4

%

Administrative service fees, net

55,879

54,928

2

54,986

2

Other service fees, net

21,421

19,008

13

22,007

(3)

Other, net

862

713

21

772

12

Total Revenue

238,468

214,048

11

232,132

3

Operating Expenses

Compensation and related

65,131

57,930

12

65,215

0

Distribution

64,146

54,440

18

62,328

3

Professional service fees

(7,864)

9,437

(183)

9,932

(179)

Systems and communications

6,532

5,825

12

6,773

(4)

Office and occupancy

6,108

6,202

(2)

6,119

0

Advertising and promotional

3,559

3,887

(8)

3,316

7

Travel and related

2,913

2,809

4

3,336

(13)

Intangible asset related

799

1,263

(37)

822

(3)

Other

7,111

5,244

36

5,271

35

Total Operating Expenses

148,435

147,037

1

163,112

(9)

Operating Income

90,033

67,011

34

69,020

30

Nonoperating Income (Expenses)

Investment income (loss), net

3,706

(1,271)

392

2,272

63

Debt expense

(3,534)

(3,972)

(11)

(3,690)

(4)

Other, net

(29)

(83)

(65)

(128)

(77)

Total Nonoperating Income (Expenses), net

143

(5,326)

103

(1,546)

109

Income before income taxes

90,176

61,685

46

67,474

34

Income tax provision

31,983

23,165

38

24,401

31

Net income including noncontrolling interest in subsidiaries

58,193

38,520

51

43,073

35

Less: Net income attributable to the noncontrolling interest in subsidiaries

2,420

200

1,110

2,663

(9)

Net Income

$

55,773

$

38,320

46

%

$

40,410

38

%

Amounts Attributable to Federated

Earnings Per Share1

Basic and Diluted

$

0.54

$

0.37

46

%

$

0.39

38

%

Weighted-average shares outstanding

Basic and diluted

100,417

100,684

100,347

Dividends declared per share

$

0.24

$

0.24

$

0.24

1) Unvested share-based payment awards that receive non-forfeitable dividend rights are deemed participating securities and are required to be considered in the computation of earnings per share under the "two-class method." As such, total net income of $2.0 million, $1.2 million and $1.5 million available to unvested restricted shares for the quarterly periods ended Sept. 30, 2012, Sept. 30, 2011 and June 30, 2012, respectively, was excluded from the computation of earnings per share.

 

Unaudited Condensed Consolidated Statements of Income

(in thousands, except per share data)

Nine Months Ended

% Change

Sept. 30, 2012

Sept. 30, 2011

Revenue

Investment advisory fees, net

$

464,020

$

448,115

4

%

Administrative service fees, net

168,157

163,527

3

Other service fees, net

66,084

65,136

1

Other, net

2,620

1,930

36

Total Revenue

700,881

678,708

3

Operating Expenses

Compensation and related

194,411

184,819

5

Distribution

188,168

176,930

6

Systems and communications

19,615

17,131

15

Office and occupancy

18,479

18,436

0

Professional service fees

12,376

44,171

(72)

Advertising and promotional

9,802

9,889

(1)

Travel and related

9,000

8,501

6

Intangible asset related

1,642

6,672

(75)

Other

17,988

16,565

9

Total Operating Expenses

471,481

483,114

(2)

Operating Income

229,400

195,594

17

Nonoperating Income (Expenses)

Investment income, net

9,325

3,721

151

Debt expense

(10,935)

(13,187)

(17)

Other, net

(195)

(192)

2

Total Nonoperating Expenses, net

(1,805)

(9,658)

(81)

Income before income taxes

227,595

185,936

22

Income tax provision

81,922

69,477

18

Net income including noncontrolling interest in subsidiaries

145,673

116,459

25

Less: Net income attributable to the noncontrolling interest in subsidiaries

7,165

2,495

187

Net Income

$

138,508

$

113,964

22

%

Amounts Attributable to Federated

Earnings Per Share1

Basic and Diluted

$

1.33

$

1.09

22

%

Weighted-average shares outstanding

Basic

100,292

100,725

Diluted

100,292

100,756

Dividends declared per share

$

0.72

$

0.72

1) Unvested share-based payment awards that receive non-forfeitable dividend rights are deemed participating securities and are required to be considered in the computation of earnings per share under the "two-class method." As such, total net income of $5.0 million and $3.7 million available to unvested restricted shares for the nine months ended Sept. 30, 2012 and Sept. 30, 2011, respectively, was excluded from the computation of earnings per share.

 

Unaudited Condensed Consolidated Balance Sheets

(in thousands)

Sept. 30, 2012

Dec. 31, 2011

Assets

Cash and other investments

$

367,777

$

322,317

Other current assets

46,282

44,194

Intangible assets, net and goodwill

725,268

720,926

Other long-term assets

65,659

63,419

Total Assets

$

1,204,986

$

1,150,856

Liabilities and Equity

Current liabilities

$

166,270

$

178,486

Long-term debt

286,875

318,750

Other long-term liabilities

128,362

110,437

Equity excluding treasury stock

1,393,607

1,315,664

Treasury stock

(770,128)

(772,481)

Total Liabilities and Equity

$

1,204,986

$

1,150,856

 

Changes in Equity and Fixed-Income Fund and Separate Account Assets

(in millions)

Quarter Ended

Nine Months Ended

Sept. 30, 2012

June 30, 2012

Sept. 30, 2011

Sept. 30, 2012

Sept. 30, 2011

Equity Funds

Beginning assets

$

22,671

$

23,612

$

22,678

$

21,930

$

22,626

Sales

1,454

1,529

2,434

4,806

5,448

Redemptions

(1,527)

(1,797)

(1,966)

(5,511)

(5,690)

Net (redemptions) sales

(73)

(268)

468

(705)

(242)

Net exchanges

(14)

3

(40)

(23)

(44)

Acquisition-related

190

0

463

190

463

Market gains and losses/reinvestments1

884

(676)

(3,429)

2,266

(2,663)

Ending assets

$

23,658

$

22,671

$

20,140

$

23,658

$

20,140

Equity Separate Accounts2

Beginning assets

$

10,550

$

10,505

$

8,702

$

8,957

$

8,176

Sales3

1,062

836

723

3,359

1,988

Redemptions3

(503)

(697)

(631)

(1,686)

(1,981)

Net sales3

559

139

92

1,673

7

Net exchanges

0

(9)

7

(9)

28

Market gains and losses/reinvestments1

588

(85)

(970)

1,076

(380)

Ending assets

$

11,697

$

10,550

$

7,831

$

11,697

$

7,831

Total Equity2

Beginning assets

$

33,221

$

34,117

$

31,380

$

30,887

$

30,802

Sales3

2,516

2,365

3,157

8,165

7,436

Redemptions3

(2,030)

(2,494)

(2,597)

(7,197)

(7,671)

Net sales (redemptions)3

486

(129)

560

968

(235)

Net exchanges

(14)

(6)

(33)

(32)

(16)

Acquisition-related

190

0

463

190

463

Market gains and losses/reinvestments1

1,472

(761)

(4,399)

3,342

(3,043)

Ending assets

$

35,355

$

33,221

$

27,971

$

35,355

$

27,971

Fixed-Income Funds

Beginning assets

$

39,494

$

38,526

$

34,874

$

37,241

$

31,933

Sales

5,120

5,636

4,049

15,578

13,294

Redemptions

(3,770)

(3,639)

(3,707)

(11,396)

(12,427)

Net sales

1,350

1,997

342

4,182

867

Net exchanges

(92)

(1,510)

29

(1,661)

1,835

Acquisition-related

144

0

132

144

132

Market gains and losses/reinvestments1

651

481

243

1,641

853

Ending assets

$

41,547

$

39,494

$

35,620

$

41,547

$

35,620

Fixed-Income Separate Accounts2

Beginning assets

$

9,474

$

7,695

$

7,544

$

7,573

$

8,772

Sales3

309

624

198

1,153

1,283

Redemptions3

(202)

(521)

(469)

(1,003)

(1,248)

Net sales (redemptions)3

107

103

(271)

150

35

Net exchanges

1

1,592

0

1,593

(1,807)

Market gains and losses/reinvestments1

260

84

(10)

526

263

Ending assets

$

9,842

$

9,474

$

7,263

$

9,842

$

7,263

Total Fixed Income2

Beginning assets

$

48,968

$

46,221

$

42,418

$

44,814

$

40,705

Sales3

5,429

6,260

4,247

16,731

14,577

Redemptions3

(3,972)

(4,160)

(4,176)

(12,399)

(13,675)

Net sales3

1,457

2,100

71

4,332

902

Net exchanges

(91)

82

29

(68)

28

Acquisition-related

144

0

132

144

132

Market gains and losses/reinvestments1

911

565

233

2,167

1,116

Ending assets

$

51,389

$

48,968

$

42,883

$

51,389

$

42,883

1) Reflects the approximate changes in the fair value of the securities held by the portfolios and, to a lesser extent, reinvested dividends, distributions, net investment income and the impact of changes in foreign exchange rates.

2) Includes separately managed accounts, institutional accounts and sub-advised funds and other managed products.

3) For certain accounts, Sales, Redemptions or Net sales (redemptions) are calculated as the remaining difference between beginning and ending assets after the calculation of Market gains and losses/reinvestments.

 

Changes in Liquidation Portfolios

(in millions)

Quarter Ended

Nine Months Ended

Sept. 30, 2012

June 30, 2012

Sept. 30, 2011

Sept. 30, 2012

Sept. 30, 2011

Liquidation Portfolios1

Beginning assets

$

8,124

$

8,583

$

9,964

$

8,856

$

10,708

Sales2

0

0

0

0

2

Redemptions2

(406)

(458)

(820)

(1,137)

(1,565)

Net redemptions2

(406)

(458)

(820)

(1,137)

(1,563)

Market gains and losses/reinvestments3

0

(1)

0

(1)

(1)

Ending Assets

$

7,718

$

8,124

$

9,144

$

7,718

$

9,144

1) Liquidation portfolios include portfolios of distressed fixed-income securities. Federated has been retained by a third party to manage these assets through an orderly liquidation process that will generally occur over a multi-year period. Management-fee rates earned from these portfolios are lower than those of traditional separate account mandates.

2) Sales, Redemptions or Net redemptions are calculated as the remaining difference between beginning and ending assets after the calculation of Market gains and losses/reinvestments.

3) Reflects the approximate changes in the fair value of the securities held by the portfolios, and, to a lesser extent, reinvested dividends, distributions, net investment income and the impact of changes in foreign exchange rates.

 

MANAGED ASSETS

(in millions)

Sept. 30, 2012

June 30, 2012

March 31, 2012

Dec. 31, 2011

Sept. 30, 2011

By Asset Class

Equity

$

35,355

$

33,221

$

34,117

$

30,887

$

27,971

Fixed-income

51,389

48,968

46,221

44,814

42,883

Money market

269,622

265,548

274,704

285,140

271,653

Liquidation portfolios1

7,718

8,124

8,583

8,856

9,144

Total Managed Assets

$

364,084

$

355,861

$

363,625

$

369,697

$

351,651

By Product Type

Funds:

Equity

$

23,658

$

22,671

$

23,612

$

21,930

$

20,140

Fixed-income

41,547

39,494

38,526

37,241

35,620

Money market

244,826

238,610

245,232

255,857

245,293

Total Fund Assets

$

310,031

$

300,775

$

307,370

$

315,028

$

301,053

Separate Accounts:

Equity

$

11,697

$

10,550

$

10,505

$

8,957

$

7,831

Fixed-income

9,842

9,474

7,695

7,573

7,263

Money market

24,796

26,938

29,472

29,283

26,360

Total Separate Accounts

$

46,335

$

46,962

$

47,672

$

45,813

$

41,454

Total Liquidation Portfolios1

$

7,718

$

8,124

$

8,583

$

8,856

$

9,144

Total Managed Assets

$

364,084

$

355,861

$

363,625

$

369,697

$

351,651

AVERAGE MANAGED ASSETS

Quarter Ended

(in millions)

Sept. 30, 2012

June 30, 2012

March 31, 2012

Dec. 31, 2011

Sept. 30, 2011

By Asset Class

Equity

$

34,158

$

32,993

$

32,827

$

29,965

$

29,699

Fixed-income

50,195

47,747

45,792

43,980

43,001

Money market

268,573

271,507

282,801

275,295

266,756

Liquidation portfolios1

7,948

8,353

8,703

9,030

9,309

Total Avg. Assets

$

360,874

$

360,600

$

370,123

$

358,270

$

348,765

By Product Type

Funds:

Equity

$

23,133

$

22,642

$

23,075

$

21,451

$

21,491

Fixed-income

40,579

38,901

38,128

36,546

35,478

Money market

243,111

243,454

251,825

249,324

239,406

Total Avg. Fund Assets

$

306,823

$

304,997

$

313,028

$

307,321

$

296,375

Separate Accounts:

Equity

$

11,025

$

10,351

$

9,752

$

8,514

$

8,208

Fixed-income

9,616

8,846

7,664

7,434

7,523

Money market

25,462

28,053

30,976

25,971

27,350

Total Avg. Separate Accounts

$

46,103

$

47,250

$

48,392

$

41,919

$

43,081

Total Avg. Liquidation Portfolios1

$

7,948

$

8,353

$

8,703

$

9,030

$

9,309

Total Avg. Managed Assets

$

360,874

$

360,600

$

370,123

$

358,270

$

348,765

1) Liquidation portfolios include portfolios of distressed fixed-income securities. Federated has been retained by a third party to manage these assets through an orderly liquidation process that will generally occur over a multi-year period. Management-fee rates earned from these portfolios are lower than those of traditional separate account mandates.

 

AVERAGE MANAGED ASSETS

Nine Months Ended

(in millions)

Sept. 30, 2012

Sept. 30, 2011

By Asset Class

Equity

$

33,326

$

30,758

Fixed-income

47,912

42,105

Money market

274,293

270,236

Liquidation portfolios1

8,334

9,994

Total Avg. Assets

$

363,865

$

353,093

By Product Type

Funds:

Equity

$

22,950

$

22,277

Fixed-income

39,203

33,759

Money market

246,130

239,807

Total Avg. Fund Assets

$

308,283

$

295,843

Separate Accounts:

Equity

$

10,376

$

8,481

Fixed-income

8,709

8,346

Money market

28,163

30,429

Total Avg. Separate Accounts

$

47,248

$

47,256

Total Avg. Liquidation Portfolios1

$

8,334

$

9,994

Total Avg. Managed Assets

$

363,865

$

353,093

1) Liquidation portfolios include portfolios of distressed fixed-income securities. Federated has been retained by a third party to manage these assets through an orderly liquidation process that will generally occur over a multi-year period. Management-fee rates earned from these portfolios are lower than those of traditional separate account mandates.

 

SOURCE Federated Investors, Inc.



RELATED LINKS

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