Janus Earnings Beat Street, But Fund Outflows Continue
Jan 24 Asset manager Janus Capital Group Inc posted higher-than expected fourth-quarter earnings on Thursday, but customers continued pulling cash out of its funds.
Performance fees topped forecasts, but so did compensation costs, Sandler O'Neill analyst Michael Kim wrote in a research note. He remains concerned about what he called "stubborn" net outflows at Janus, which is among a group of asset managers battling to regain net deposits from customers.
The Denver-based company finished the quarter with $156.8 billion under management, down from $158.2 billion at Sept. 30.
Although market gains drove up assets by $2.1 billion in the period, Janus reported net outflows of $3.6 billion from long-term funds.
Janus' traditional equity funds remained out of favor with investors, who pulled $2.7 billion from them in the quarter, and withdrew $1.6 billion from Janus' quantitative funds.
Janus posted a net inflow of about $700 million to its fixed-income funds, an area it has been building up. But even that was lower than the $1.2 billion that Sterne Agee analyst Jason Weyeneth had forecast, he said in a research note.
For the quarter, Janus reported net income of $31.2 million, or 17 cents per share, down from $35.7 million, or 19 cents per share, a year earlier. Analysts' average forecast was 14 cents a share, according to Thomson Reuters I/B/E/S.
Revenue rose by $1 million to $216.6 million.
Operating expenses climbed by more than $13 million, to $158.6 million, driven by higher compensation costs.
Janus shares were up 5 cents to $9.88 in morning trading.
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