Investment management giant
The Pittsburgh-based company said fourth-quarter net income fell to $42.8 million, or 38 cents a share, compared to $48.9 million, or 42 cents a share, in the year-ago period.
The results included a charge of 12 cents a share for the creation of cash reserves to pay restitution to investors who suffered losses as a result of illegal late trading and deceptive market timing practices.
Federated said last week it set up a $7.6 million fund to repay harmed investors and use another $12.4 million to pay for its internal probe into questionable trading practices.
In November, the company fired one mid-level officer who admitted deleting e-mail messages relevant to its investigation, and accepted the resignations of two executives who arranged for some investors to engage in frequent trades.
The internal investigation revealed that investment advisor
Further, Federated said it had found no evidence to suggest employees had special arrangements in place to allow customers to engage in late trading. To date, no formal charges have been filed against the company.
Excluding the one-time charge, the company posted net profits of 50 cents a share. Wall Street analysts, on average, were expecting Federated to earn 47 cents a share, according to research firm
Total assets under management climbed to $197.9 billion at the end of 2003 from $195.4 billion the previous year.