Market Commentary and Intraday News

Invesco earnings fall as investors jump ship

295 days ago

(AP:ATLANTA) Investment manager Invesco on Thursday posted lower profit and revenue for the second quarter as investors exited the volatile market.

Invesco, which runs the Van Kampen fund in addition to its namesake fund, helps individuals and companies manage and invest their money. Firms like Invesco make money on fees and sometimes also take a cut of their funds' returns.

The second quarter was a difficult environment for investing, with U.S. stocks falling after a powerful first quarter. The Standard & Poor's 500, a closely watched indicator of the overall stock market, fell 3 percent in the second quarter after jumping 12 percent in the first.

Invesco's results reflected the market. Compared with the first quarter, fund performance fees fell 25 percent. Fees for investment management services slipped 1 percent. Total assets under management at June 30 fell to $646.6 billion from $672.8 million at the end of March. And clients pulled a total of $8.3 billion out of accounts.

"Investors naturally were seeking safe havens and acting very defensively" during the quarter, CEO Martin L. Flanagan said on a call with analysts Thursday. But he said that in the first few weeks of July the company has seen a "sharp turnaround" in flows.

The Atlanta-based company said net income fell 16 percent to $153.9 million, or 34 cents per share in the April-June period, from $183 million, or 39 cents per share, in the year-ago quarter.

After stripping out one-time charges, the company earned 41 cents per share _ short of the 43 cents predicted by analysts polled by FactSet.

Nomura analyst Glenn Schorr reiterated his "Buy" rating on the company, calling the quarter a "product of the environment." In a note to clients, he said the quarterly results were "not the end of the world," given Invesco's solid long-term record.

Shares finished Thursday's session up 42 cents, or 2 percent, at $20.91.

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