FEDERATED HERMES, INC. 
By PITTSBURGH, Jan. 28 /PRNewswire-FirstCall/ -- Federated Investors, Inc. (NYSE: FII), one of the nation's largest investment managers, today reported earnings per diluted share (EPS) of $0.51 for the quarter ended Dec. 31, 2009 compared to $0.53 for the same quarter last year. Net income was $51.9 million for Q4 2009 compared to $54.3 million for Q4 2008.
For the year ended Dec. 31, 2009, Federated reported EPS from continuing operations of $1.92 compared to $2.15 for 2008, a decrease of 11 percent. For 2009, income from continuing operations was $197.3 million compared to $221.5 million for the same period in 2008. Earnings for 2009 included $21.3 million in non-cash impairment charges recognized primarily in Q1 2009.
Federated's total managed assets were $389.3 billion at Dec. 31, 2009, down $18.0 billion or 4 percent from $407.3 billion at Dec. 31, 2008 and down $3.0 billion or 1 percent from $392.3 billion reported at Sept. 30, 2009. Average managed assets for Q4 2009 were $388.1 billion, up $18.3 billion or 5 percent from $369.8 billion reported for Q4 2008 and down $20.0 billion or 5 percent from $408.1 billion reported for Q3 2009.
"With better market conditions in 2009, Federated experienced strong demand for fixed-income and equity products," said J. Christopher Donahue, president and chief executive officer. "Gross sales of fixed-income and equity funds increased 64 percent from 2008. In particular, fixed-income fund sales were strong as investors valued our consistent fund performance over a multi-year period."
Federated's board of directors declared a dividend of $1.50 per share. The dividend, which will be paid in cash, is considered an ordinary dividend for tax purposes and consists of a $0.24 quarterly dividend and a $1.26 special dividend. The dividend is payable on Feb. 12, 2010 to shareholders of record as of Feb. 5, 2010.
"The February 2010 special dividend rewards shareholders for the success that Federated achieved in 2009," said Thomas R. Donahue, chief financial officer. "Through our diversified business mix and the efforts of our outstanding employees, Federated has successfully navigated through the challenges of the last several quarters and remains well positioned for new growth opportunities."
In addition, during Q4 2009, Federated purchased 50,000 shares of Federated class B common stock for $1.3 million. In 2009, the company purchased 828,918 shares of Federated class B common stock for $20.1 million.
Federated's fixed-income assets were $33.8 billion at Dec. 31, 2009, up $10.3 billion or 44 percent from $23.5 billion at Dec. 31, 2008 and up $1.8 billion or 6 percent from $32.0 billion at Sept. 30, 2009. Federated experienced continued strong net positive flows into its bond funds with $1.3 billion during Q4 2009, bringing total net bond fund inflows to $6.8 billion for 2009, an increase of $5.4 billion over 2008. Net sales were driven by strong flows into ultrashort bond funds and intermediate-term bond funds including Federated Total Return Bond Fund.
Federated's equity assets were $29.7 billion at Dec. 31, 2009, up $3.0 billion or 11 percent from $26.7 billion at Dec. 31, 2008 and up $0.6 billion or 2 percent from $29.1 billion at Sept. 30, 2009. During Q4 2009, Federated's net flows into equity funds were $67 million. Equity fund net outflows improved to $47 million for 2009 compared to net outflows of $2.2 billion in 2008. Net sales were led by Federated Prudent Bear Fund, Federated Strategic Value Fund and Federated Market Opportunity Fund.
Money market assets in both funds and separate accounts were $313.3 billion at Dec. 31, 2009, down $42.4 billion or 12 percent from $355.7 billion at Dec. 31, 2008 and down $4.8 billion or 2 percent from $318.1 billion at Sept. 30, 2009. Money market mutual fund assets were $281.6 billion at Dec. 31, 2009, down $45.7 billion or 14 percent from $327.3 billion at Dec. 31, 2008 and down $6.0 billion or 2 percent from $287.6 billion at Sept. 30, 2009.
Financial Summary
Q4 2009 vs. Q4 2008
For Q4 2009, revenue decreased by $37.0 million or 12 percent from the same quarter last year. The decrease in revenue primarily reflects a $54.1 million increase in voluntary fee waivers related to certain money market funds in order to maintain positive or zero net yields. This increase in fee waivers was largely offset by a related decrease in marketing and distribution expenses of $40.7 million such that the net impact on operating income was a decrease of $13.4 million. In addition, revenue decreased due to lower average money market managed assets. These decreases were partially offset by the impact of increased average fixed-income and equity managed assets.
Fee waivers to produce positive or zero net yields may increase and such increases could be significant. The amount of these waivers will be determined by a variety of factors including available yields on instruments held by the money market funds, changes in assets within money market funds, actions by the Federal Reserve and the U.S. Department of the Treasury, changes in the mix of money market customer assets, changes in expenses of the money market funds and Federated's willingness to continue these waivers.
In Q4 2009, Federated derived 56 percent of its revenue from money market assets, 43 percent from fluctuating assets (28 percent from equity assets and 15 percent from fixed-income assets) and 1 percent from other products and services.
Operating expenses for Q4 2009 were $178.4 million compared to $216.0 million for Q4 2008. This change was primarily a result of lower marketing and distribution expenses due to the aforementioned fee-waiver-related reductions.
Q4 2009 vs. Q3 2009
Compared to the prior quarter, revenue decreased by $28.8 million or 10 percent. The decrease in revenue primarily reflects a $21.0 million increase in voluntary fee waivers on certain money market funds in order to maintain positive or zero net yields. This increase in fee waivers was largely offset by a related decrease in marketing and distribution expenses of $14.7 million such that the net impact on operating income was a decrease of $6.3 million compared to the prior quarter. In addition, revenue decreased due to lower average money market managed assets. These decreases were partially offset by the impact of increased average equity and fixed-income managed assets.
Compared to Q3 2009, operating expenses decreased by $20.4 million or 10 percent. Changes from the prior period include a decrease in marketing and distribution expenses primarily related to the aforementioned fee-waiver-related reductions.
2009 vs. 2008
Revenue for 2009 decreased by $47.7 million or 4 percent compared to last year. The decrease in revenue primarily reflects a $117.0 million increase in voluntary fee waivers on certain money market funds in order to maintain positive or zero net yields. This increase in fee waivers was largely offset by a related decrease in marketing and distribution expenses of $84.5 million such that the net impact on operating income was a decrease of $32.5 million. In addition, revenue decreased due to lower average equity managed assets. These decreases were partially offset by the impact of increased average money market and fixed-income managed assets.
In 2009, Federated derived 65 percent of its revenue from money market assets, 35 percent from fluctuating assets (23 percent from equity assets and 12 percent from fixed-income assets).
Operating expenses for 2009 decreased by $15.8 million or 2 percent compared to last year. Changes from the prior year include a decrease in marketing and distribution expenses primarily related to the aforementioned fee-waivers offset by the impact of average asset changes, higher acquisition-related compensation expense and non-cash impairment charges to write down certain intangible assets in Q1 2009. Compared to 2008, professional service fees, travel and related and advertising and promotional expenses all decreased during 2009 due, in part, to companywide cost-saving initiatives.
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.
Federated will host an earnings conference call at 9 a.m. Eastern on Friday, Jan. 29, 2010. 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 Us section of FederatedInvestors.com. A replay will be available after 12:30 p.m. and until Feb. 6, 2010 by calling 877-660-6853 (domestic) or 201-612-7415 (international) and entering codes 286 and 340551.
Federated Investors, Inc. is one of the largest investment managers in the United States, managing $389.3 billion in assets as of Dec. 31, 2009. With 145 funds and a variety of separately managed account options, Federated provides comprehensive investment management to more than 5,200 institutions and intermediaries including corporations, government entities, insurance companies, foundations and endowments, banks and broker/dealers. Federated ranks in the top 2 percent of money market fund managers in the industry, the top 6 percent of fixed-income fund managers and the top 8 percent of equity fund managers(1). For more information, visit FederatedInvestors.com.
(1) Strategic Insight, Nov. 30, 2009. 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 advisor.
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, 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, 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(1)
(in thousands, except per share data)
% %
Quarter Ended Change Change
Dec. 31, Q4 Quarter Q3
---------------- 2008 Ended 2009
2009 2008 to Q4 Sept. 30, to Q4
---- ---- 2009 2009 2009
Revenue
Investment advisory
fees, net $175,586 $187,684 (6)% $190,012 (8)%
Administrative
service fees, net 61,884 60,907 2 65,267 (5)
Other service fees, net 26,124 50,889 (49) 36,957 (29)
Other, net 1,216 2,288 (47) 1,367 (11)
---------- ----- ----- --- ----- ---
Total Revenue 264,810 301,768 (12) 293,603 (10)
------------- ------- ------- --- ------- ---
Operating Expenses
Compensation and
related 62,359 56,219 11 62,232 0
General and
administrative
Marketing and
distribution 76,403 115,518 (34) 95,452 (20)
Professional
service fees 8,260 9,945 (17) 10,089 (18)
Office and occupancy 6,194 6,276 (1) 6,001 3
Systems and
communications 5,914 5,721 3 6,517 (9)
Travel and related 3,743 3,883 (4) 2,316 62
Advertising and
promotional 2,847 3,323 (14) 2,529 13
Other 5,274 4,958 6 4,677 13
----- ----- ----- --- ----- ---
Total general and
administrative 108,635 149,624 (27) 127,581 (15)
Amortization of
deferred sales
commissions 3,526 5,453 (35) 5,104 (31)
Intangible asset
amortization 3,909 4,715 (17) 3,953 (1)
------------ ----- ----- --- ----- ---
Total
Operating
Expenses 178,429 216,011 (17) 198,870 (10)
-------- ------- ------- --- ------- ---
Operating Income 86,381 85,757 1 94,733 (9)
---------------- ------ ------ --- ------ ---
Nonoperating Income (Expenses)
Investment income, net 814 (1,115) 173 1,685 (52)
Debt expense - recourse (975) (1,464) (33) (1,112) (12)
Debt expense - nonrecourse (253) (518) (51) (314) (19)
Other, net 41 (100) 141 (101) 141
---------- --- ---- --- ---- ---
Total Nonoperating
(Expenses) Income,
net (373) (3,197) (88) 158 (336)
--- ---- ------ --- --- ----
Income before
income taxes 86,008 82,560 4 94,891 (9)
Income tax provision 31,308 27,041 16 34,604 (10)
-------------------- ------ ------ --- ------ ---
Net income including
noncontrolling
interests in
subsidiaries 54,700 55,519 (1) 60,287 (9)
Less: Net income
attributable
to noncontrolling
interests in
subsidiaries 2,803 1,256 123 3,301 (15)
------------ ----- ----- --- ----- ---
Net Income $51,897 $54,263 (4)% $56,986 (9)%
---------- ------- ------- --- ------- ---
Amounts Attributable
to Federated Earnings
Per Share(2)
Basic $0.51 $0.53 (4)% $0.56 (9)%
Diluted $0.51 $0.53 (4)% $0.56 (9)%
------- ----- ----- --- ----- ---
Weighted-average
shares outstanding
Basic 99,763 99,891 99,958
Diluted 99,938 100,025 100,086
------- ------ ------- -------
Dividends declared per
share $0.24 $0.24 $0.24
----- ----- ----- -----
(1) Provisions of a new accounting standard adopted on Jan. 1, 2009
require that minority interest be renamed noncontrolling interest and that
companies present a consolidated net income that includes the amount
attributable to noncontrolling interests for all periods presented.
(2) Under a new accounting standard adopted on Jan. 1, 2009, unvested
share-based payment awards that receive non-forfeitable dividend rights
are considered participating securities and are now required to be
in the computation of earnings per share under the "two-class method."
As a result, current and prior periods have been adjusted to reflect this
new standard. Total income available to participating restricted
shareholders was $1.4 million, $0.9 million and $1.4 million for the
quarterly periods ended Dec. 31, 2009, Dec. 31, 2008 and Sept. 30, 2009,
respectively.
Unaudited Condensed Consolidated Statements of Income(1)
(in thousands, except per share data)
Year Ended Dec. 31,
------------------- % Change
2009 2008
---- ----
Revenue
Investment advisory
fees, net $749,823 $775,381 (3)%
Administrative
service fees, net 261,610 218,735 20
Other service fees,
net 158,999 221,327 (28)
Other, net 5,518 8,237 (33)
---------- ----- ----- ---
Total Revenue 1,175,950 1,223,680 (4)
------------- --------- --------- ---
Operating Expenses
Compensation and
related 254,428 237,186 7
General and
administrative
Marketing and
distribution 408,300 440,317 (7)
Professional service
fees 38,133 40,301 (5)
Systems and
communications 25,189 23,648 7
Office and occupancy 24,509 24,342 1
Travel and related 11,374 14,048 (19)
Advertising and
promotional 11,085 14,819 (25)
Other 22,669 18,080 25
----- ------ ------ ---
Total general and
administrative 541,259 575,555 (6)
Amortization of
deferred sales
commissions 18,462 31,376 (41)
Intangible asset
impairment and
amortization 32,574 18,388 77
---------------- ------ ------ ---
Total Operating
Expenses 846,723 862,505 (2)
--------------- ------- ------- ---
Operating Income 329,227 361,175 (9)
---------------- ------- ------- ---
Nonoperating Income
(Expenses)
Investment income, net 3,308 1,250 165
Debt expense - recourse (4,345) (2,425) 79
Debt expense - nonrecourse (1,366) (2,750) (50)
Other, net (6) (457) (99)
---------- --- ---- ---
Total Nonoperating
Expenses, net (2,409) (4,382) (45)
------------- ------ ------ ---
Income from
continuing
operations before
income taxes 326,818 356,793 (8)
Income tax provision 118,278 128,168 (8)
-------------------- ------- ------- ---
Income from
continuing
operations
including
noncontrolling
interests in
subsidiaries 208,540 228,625 (9)
Discontinued operations,
net of tax - 2,808 (100)
---------- --- ----- ----
Net income including
noncontrolling
interests in
subsidiaries 208,540 231,433 (10)
Less: Net income
attributable to the
noncontrolling
interest in
subsidiaries 11,248 7,116 58
------------ ------ ----- ---
Net Income $197,292 $224,317 (12)%
---------- -------- -------- ---
Amounts Attributable
to Federated
Income from
continuing
operations $197,292 $221,509 (11)%
Discontinued
operations, net of
tax - 2,808 (100)
--- --- ----- ----
Net Income $197,292 $224,317 (12)%
---------- -------- -------- ---
Earnings Per
Share-Basic(2)
Income from
continuing
operations $1.93 $2.17 (11)%
Income from
discontinued
operations - 0.03 (100)
------------- --- ---- ----
Net Income $1.93 $2.20 (12)%
---------- ----- ----- ---
Earnings Per
Share-Diluted(2)
Income from
continuing
operations $1.92 $2.15 (11)%
Income from
discontinued
operations - 0.03 (100)
------------- --- ---- ----
Net Income $1.92 $2.18 (12)%
---------- ----- ----- ---
Weighted-average
shares outstanding
Basic 99,923 99,605
Diluted 100,056 100,395
------- ------- -------
Dividends declared
per share $0.96 $3.69
------------------ ----- -----
(1) Provisions of a new accounting standard adopted on Jan. 1, 2009
require that minority interest be renamed noncontrolling interest and that
companies present a consolidated net income that includes the amount
attributable to noncontrolling interests for all periods presented.
(2) Under a new accounting standard adopted on Jan. 1, 2009, unvested
share-based payment awards that receive non-forfeitable dividend rights
are considered participating securities and are now required to be
included in the computation of earnings per share under the "two-class
method." As a result current and prior periods have been adjusted to
reflect this new standard. Total income available to participating
restricted shareholders was $4.9 million and $5.2 million for the years
ended Dec. 31, 2009 and Dec. 31, 2008, respectively.
Unaudited Condensed Consolidated Balance Sheets
(in thousands)
Dec. 31, Dec. 31,
2009 2008
---- ----
Assets
Cash and other short-term investments $121,990 $58,647
Other current assets 62,797 58,185
Deferred sales commissions, net 15,318 30,261
Intangible assets, net and goodwill 662,996 657,321
Other long-term assets 49,332 42,196
---------------------- -------- --------
Total Assets $912,433 $846,610
------------ -------- --------
Liabilities and Equity
Current liabilities $196,998 $217,838
Long-term debt recourse 105,000 126,000
Long-term debt nonrecourse 13,556 30,497
Other long-term liabilities 54,151 47,705
Equity excluding treasury stock(1) 1,338,117 1,229,051
Treasury stock (795,389) (804,481)
-------------- -------- --------
Total Liabilities and Equity $912,433 $846,610
---------------------------- -------- --------
(1) Provisions of a new accounting standard adopted on Jan. 1, 2009
require that minority interest be renamed noncontrolling interest and
companies present it as a component of equity for all periods presented.
Noncontrolling interest was previously included in other long-term
liabilities, but is now included in Equity excluding treasury stock.
Changes in Equity and Fixed-Income Fund Managed Assets
(in millions)
Quarter Ended Year Ended Dec. 31,
------------- -------------------
Dec. 31, Dec. 31, Sept. 30,
2009 2008 2009 2009 2008
---- ---- ---- ---- ----
Equity Funds
Beginning
assets $20,350 $21,583 $17,966 $17,562 $29,145
--------- ------- ------- ------- ------- -------
Sales 1,555 1,031 1,503 5,560 5,040
Redemptions (1,488) (1,752) (1,377) (5,607) (7,205)
----------- ------ ------ ------ ------ ------
Net sales
(redemptions) 67 (721) 126 (47) (2,165)
Net exchanges (11) (103) (12) (90) (266)
Acquisition
related 0 1,149 257 257 1,191
Market gains
and losses/
reinvestments(1) 554 (4,346) 2,013 3,278 (10,343)
--------------- --- ------ ----- ----- -------
Ending assets $20,960 $17,562 $20,350 $20,960 $17,562
------------- ------- ------- ------- ------- -------
Fixed-Income
Funds
Beginning
assets $26,960 $19,136 $24,100 $19,321 $17,943
--------- ------- ------- ------- ------- -------
Sales 4,355 2,172 4,789 16,892 8,681
Redemptions (3,095) (2,331) (2,971) (10,073) (7,242)
----------- ------ ------ ------ ------- ------
Net sales
(redemptions) 1,260 (159) 1,818 6,819 1,439
Net exchanges 27 13 53 128 92
Acquisition
related 0 658 0 0 658
Market gains
and losses/
reinvestments(1) 180 (327) 989 2,159 (811)
--------------- --- ---- --- ----- ----
Ending assets $28,427 $19,321 $26,960 $28,427 $19,321
------------- ------- ------- ------- ------- -------
(1) Reflects the approximate changes in the market value of the securities
held by the funds and, to a lesser extent, reinvested dividends,
distributions, net investment income and the impact of changes in foreign
exchange rates.
Changes in Equity and Fixed-Income Separate Account Assets(2)
(in millions)
Quarter Ended Year Ended Dec. 31,
Dec. 31, Dec. 31, Sept. 30,
2009 2008 2009 2009 2008
---- ---- ---- ---- ----
Equity Separate
Accounts
Beginning assets $8,774 $10,068 $8,245 $9,099 $13,017
---------------- ------ ------- ------ ------ -------
Net customer
flows(3) (403) (754) (261) (1,429) (1,375)
Acquisition
related(4) 0 1,537 (257) (257) 1,537
Market gains
and losses/
reinvestments(5) 342 (1,752) 1,047 1,300 (4,080)
--------------- --- ------ ----- ----- ------
Ending assets $8,713 $9,099 $8,774 $8,713 $9,099
------------- ------ ------ ------ ------ ------
Fixed-Income
Separate Accounts
Beginning assets $5,079 $3,602 $4,583 $4,165 $3,754
---------------- ------ ------ ------ ------ ------
Net customer
flows(3) 241 180 188 510 86
Acquisition
related 0 444 0 0 444
Market gains
and losses/
reinvestments(5) 40 (61) 308 685 (119)
--------------- --- --- --- --- ----
Ending assets $5,360 $4,165 $5,079 $5,360 $4,165
------------- ------ ------ ------ ------ ------
(2) Includes separately managed accounts, institutional accounts and sub-
advised funds (both variable annuity and other) and other managed
products. Flows for liquidation portfolios have been removed from Changes
in Equity and Fixed-Income Separate Account Assets and are detailed on the
following page.
(3) For certain accounts, Net customer flows are calculated as the
remaining difference between beginning and ending assets after the
calculation of Market gains and losses/reinvestments.
(4) Includes assets that were reclassified from Equity Separate Accounts
to Equity Funds as a result of the transaction with the Touchstone Funds,
which was completed during Q3 2009. See related press release dated Aug.
31, 2009 for more information about the Touchstone transaction.
(5) Reflects the approximate changes in the market value of the securities
held in the portfolios, and, to a lesser extent, reinvested dividends,
distributions, net investment income and the impact of changes in foreign
exchange rates.
Changes in Liquidation Portfolios(1)
(in millions)
Quarter Ended Year Ended Dec. 31,
------------- -------------------
Dec. 31, Dec. 31, Sept. 30,
2009 2008 2009 2009 2008
Liquidation Portfolios
Beginning
assets $13,073 $1,777 $556 $1,505 $1,127
------ ------- ------ ---- ------ ------
Net customer
flows(2) (478) (205) 12,516 11,085 652
Market gains
and losses/
reinvestments(3) 1 (67) 1 6 (274)
--------------- --- --- --- --- ----
Ending assets $12,596 $1,505 $13,073 $12,596 $1,505
------------- ------- ------ ------- ------- ------
(1) Liquidation portfolios include portfolios of distressed fixed-income
securities and liquidating collateralized debt obligation (CDO) products.
In the distressed security category, 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. In the case of
liquidating CDOs, the CDO structure has unwound earlier than expected due
to events of default related to certain distressed securities in the
portfolio. Management fee rates earned from these portfolios are
significantly different than those of traditional separate account
mandates.
(2) For certain accounts, Net customer flows 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 market value of the securities
held in the portfolios, and, to a lesser extent, reinvested dividends,
distributions, net investment income and the impact of changes in foreign
exchange rates.
(in millions)
Dec. 31, Sept. 30, June 30, March 31, Dec. 31,
MANAGED ASSETS 2009 2009 2009 2008 2009
-------------- ---- ---- ---- ---- ----
By Asset Class
--------------
Equity $29,673 $29,124 $26,211 $23,411 $26,661
Fixed-income 33,787 32,039 28,683 24,971 23,486
Money market 313,260 318,064 346,354 360,127 355,658
Liquidation
portfolios(1) 12,596 13,073 556 700 1,505
--------------- ------ ------ --- --- -----
Total Managed
Assets $389,316 $392,300 $401,804 $409,209 $407,310
------------- -------- -------- -------- -------- --------
By Product Type
---------------
Mutual Funds:
Equity $20,960 $20,350 $17,966 $15,902 $17,562
Fixed-income 28,427 26,960 24,100 20,752 19,321
Money market 281,569 287,634 312,808 328,780 327,267
------------ ------- ------- ------- ------- -------
Total Fund
Assets $330,956 $334,944 $354,874 $365,434 $364,150
---------- -------- -------- -------- -------- --------
Separate
Accounts:
Equity $8,713 $8,774 $8,245 $7,509 $9,099
Fixed-income 5,360 5,079 4,583 4,219 4,165
Money market 31,691 30,430 33,546 31,347 28,391
------------ ------ ------ ------ ------ ------
Total Separate
Accounts $45,764 $44,283 $46,374 $43,075 $41,655
-------------- ------- ------- ------- ------- -------
Total
Liquidation
Portfolios(1) $12,596 $13,073 $556 $700 $1,505
-------------- ------- ------- ---- ---- ------
Total Managed
Assets $389,316 $392,300 $401,804 $409,209 $407,310
------------- -------- -------- -------- -------- --------
AVERAGE MANAGED
ASSETS Quarter Ended
Dec. 31, Sept. 30, June 30, March 31, Dec. 31,
2009 2009 2009 2009 2008
-------------- ---- ---- ---- ---- ----
By Asset Class
--------------
Equity $29,343 $27,872 $25,287 $24,219 $24,870
Fixed-income 33,164 30,376 26,978 24,218 22,546
Money market 312,761 336,530 361,502 362,269 320,684
Liquidation
portfolios(1) 12,881 13,370 637 975 1,650
--------------- ------ ------ --- --- -----
Total Avg.
Assets $388,149 $408,148 $414,404 $411,681 $369,750
---------- -------- -------- -------- -------- --------
By Product Type
---------------
Mutual Funds:
Equity $20,625 $19,215 $17,220 $16,240 $16,904
Fixed-income 27,903 25,499 22,545 20,009 18,674
Money market 283,353 304,959 326,280 330,294 293,428
------------ ------- ------- ------- ------- -------
Total Avg. Fund
Assets $331,881 $349,673 $366,045 $366,543 $329,006
--------------- -------- -------- -------- -------- --------
Separate
Accounts:
Equity $8,718 $8,657 $8,067 $7,979 $7,966
Fixed-income 5,261 4,877 4,433 4,209 3,872
Money market 29,408 31,571 35,222 31,975 27,256
------------ ------ ------ ------ ------ ------
Total Avg.
Separate
Accts. $43,387 $45,105 $47,722 $44,163 $39,094
---------- ------- ------- ------- ------- -------
Total Avg.
Liquidation
Portfolios(1) $12,881 $13,370 $637 $975 $1,650
-------------- ------- ------- ---- ---- ------
Total Avg.
Managed Assets $388,149 $408,148 $414,404 $411,681 $369,750
--------------- -------- -------- -------- -------- --------
(1) Liquidation portfolios include portfolios of distressed fixed-income
securities and liquidating collateralized debt obligation (CDO) products.
In the distressed security category, 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. In the case of
liquidating CDOs, the CDO structure has unwound earlier than expected due
to events of default related to certain distressed securities in the
portfolio. Management fee rates earned from these portfolios are
significantly different than those of traditional separate account
mandates.
SOURCE Federated Investors, Inc.
