Waddell & Reed announced Wednesday that its first-quarter profit rose 17% from a year earlier to $28.7 million, or 35 cents a share, from $24.6 billion, or 30 cents a share, in the first quarter of 2006.

Driving income, the firm said, was investment management, underwriting and distribution.

Revenue was $189.5 million in the first quarter of 2007, a 9% increase from $173.1 million in the first quarter of 2006.

The profits slightly missed analysts’ expectations of 36 cents a share and $194.8 million in revenue.

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