Embattled fund giant Alliance Capital announced that fourth-quarter profits stormed higher as a year-end rally in the stock market boosted revenue.
The New York-based money manager posted net income of $233.2 million, or 82 cents a share, a robust spike from the $53.5 million, or 13 cents a share, it earned in the year-ago period. Wall Street analysts, on average, were expecting earnings of 70 cents a share, according to research firm Thomson ONE Analytics.
Small-cap and international equity funds performed particularly well, while fixed-income offerings generated more modest gains, the company said.
Administrative expenses for the quarter rose to $109 million from $94.6 million. The increase in expenses reflected a $7 million software writedown and $5 million related to rent and charges associated with the company vacating office space.
Alliance has been hit hard by the fund trading scandal, for which the company was forced to pay $600 million in penalties and reduced advisory fees. Its growth equity funds continue to bleed assets as fallout from the scandal and the trend of value outperforming growth continues.
For the full year, Alliance took in $8.3 billion in new assets, and the company is optimistic that sales will improve in 2005. Its institutional business garnered $7.7 billion, but retail assets suffered a $4 billion outflow.