Cohen & Steers Reports First Quarter 2016 Results

NEW YORK, April 20, 2016 /PRNewswire/ -- Cohen & Steers, Inc. CNS reported net income attributable to common stockholders of $18.1 million, or $0.39 per share (diluted and basic), for the quarter ended March 31, 2016, compared with $20.8 million, or $0.45 per diluted share and $0.46 per basic share, for the quarter ended March 31, 2015. Total revenue for the first quarter of 2016 was $79.7 million, a decrease of 4.9% from $83.8 million for the first quarter of 2015.

The first quarter 2016 results included a non-cash after-tax expense of approximately $0.03 per share associated with the accelerated vesting of certain restricted stock units. After adjusting for this item, diluted earnings per share would have been $0.42 for the quarter ended March 31, 2016.

Financial Highlights (Unaudited)

For the Periods


(in thousands, except per share data)

 Three Months Ended


 % Change From


March 31,
2016


December 31,
2015


March 31,
2015


December 31,
2015


March 31,
2015

Revenue

$

79,681


$

81,671


$

83,815


(2.4%)


(4.9%)

Expenses

$

51,374


$

51,319


$

49,266


0.1%


4.3%

Operating income

$

28,307


$

30,352


$

34,549


(6.7%)


(18.1%)

Operating margin


35.5%



37.2%



41.2%


(164) bps


(570) bps

Total non-operating income (loss) (1)

$

643


$

(12,078)


$

(1,552)


*


*

Net income attributable to common stockholders

$

18,083


$

5,879


$

20,816


207.6%


(13.1%)

Diluted earnings per share attributable to common
stockholders

$

0.39


$

0.13


$

0.45


206.1%


(13.5%)

________________________


 *  

Not meaningful


(1)

Includes net income/(loss) attributable to redeemable noncontrolling interest for the periods presented.


Revenue

Revenue for the first quarter of 2016 was $79.7 million, a decrease of $2.0 million from $81.7 million for the fourth quarter of 2015. Lower average assets under management in closed-end funds and one less day in the quarter resulted in the following decreases in investment advisory and administration fees:

  • Institutional account revenue decreased $0.2 million to $21.3 million for the first quarter of 2016;
  • Open-end fund revenue decreased $0.7 million to $33.5 million for the first quarter of 2016; and
  • Closed-end fund revenue decreased $1.3 million to $18.3 million for the first quarter of 2016.

Expenses

Expenses for the first quarter of 2016 were $51.4 million, an increase of $0.1 million from $51.3 million for the fourth quarter of 2015. Changes in expenses were primarily:

  • Higher employee compensation and benefits expenses of $0.6 million, primarily attributable to the accelerated vesting of certain restricted stock units partially offset by lower incentive compensation when compared with the fourth quarter of 2015;
  • Lower general and administrative expenses of $0.7 million, primarily due to lower costs associated with hosted and sponsored events and lower fund organizational expenses, partially offset by an increase in recruiting fees; and
  • Higher depreciation and amortization of $0.4 million, primarily due to the obsolescence of certain fixed assets.

Operating Margin

The company's operating margin decreased to 35.5% for the first quarter of 2016 from 37.2% for the fourth quarter of 2015.

Non-operating Income

Non-operating income for the first quarter of 2016 was $0.6 million, compared with non-operating loss of $12.1 million for the fourth quarter of 2015. The change was primarily due to net unrealized gains on the company's seed investments in the first quarter of 2016 compared with net unrealized losses during the fourth quarter of 2015. The fourth quarter of 2015 included unrealized losses that were primarily due to a change in accounting classification and an other-than-temporary impairment on certain seed investments.

Assets Under Management Highlights (Unaudited)

March 31, 2016 Compared with December 31, 2015


(in millions)

Assets Under Management




As of



By Investment Vehicle

March 31,
 2016


December 31,
 2015


% Change

    Institutional accounts

$

27,857



$

26,105



6.7%

    Open-end funds

18,146



17,460



3.9%

    Closed-end funds

9,056



9,029



0.3%

Total

$

55,059



$

52,594



4.7%







By Investment Strategy






    U.S. real estate

$

29,069



$

27,814



4.5%

    Global/international real estate

10,152



9,476



7.1%

    Preferred securities

8,099



7,705



5.1%

    Global listed infrastructure

5,272



5,147



2.4%

    Other

2,467



2,452



0.6%

Total

$

55,059



$

52,594



4.7%

Assets under management were $55.1 billion as of March 31, 2016, an increase of $2.5 billion from $52.6 billion at December 31, 2015. The increase from December 31, 2015 was attributable to net inflows of $1.4 billion and market appreciation of $1.9 billion, partially offset by distributions of $0.9 billion.

Institutional Accounts

Assets under management in institutional accounts were $27.9 billion as of March 31, 2016, an increase of 6.7% from $26.1 billion at December 31, 2015. The change from December 31, 2015 was due to the following:

  • Market appreciation of $1.2 billion, including $699 million from U.S. real estate and $341 million from global/international real estate;
  • Net inflows of $813 million into subadvisory accounts, including $768 million into U.S. real estate, $53 million into preferred securities and $28 million into global listed infrastructure, partially offset by net outflows of $53 million from global/international real estate;
  • Net inflows of $377 million into advisory accounts, including $510 million into global/international real estate, partially offset by net outflows of $95 million from U.S. real estate; and
  • Distributions out of subadvisory accounts in Japan of $653 million including $606 million from U.S. real estate and $42 million from global/international real estate.

Open-end Funds

Assets under management for open-end funds were $18.1 billion as of March 31, 2016, an increase of 3.9% from $17.5 billion at December 31, 2015. The change from December 31, 2015 was due to the following:

  • Market appreciation of $495 million, including $402 million from U.S. real estate and $67 million from global/international real estate;
  • Net inflows of $324 million, including net inflows of $417 million into preferred securities, partially offset by net outflows of $149 million from global/international real estate; and
  • Distributions of $133 million, including $71 million from preferred securities and $60 million from U.S. real estate.

Closed-end Funds

Assets under management for closed-end funds were $9.1 billion as of March 31, 2016, an increase of 0.3% from $9.0 billion at December 31, 2015. The increase from December 31, 2015 was due to market appreciation of $235 million, partially offset by distributions of $122 million and outflows of $86 million related to a decrease in a fund's outstanding leverage.

Balance Sheet Information

As of March 31, 2016, cash, cash equivalents and seed investments were $186 million. As of March 31, 2016, stockholders' equity was $238 million and the company had no debt.

Conference Call Information

Cohen & Steers will host a conference call tomorrow, April 21, 2016 at 10:00 a.m. (ET) to discuss the company's first quarter results. Investors and analysts can access the live conference call by dialing 800-616-4707 (U.S.) or +1-303-223-2691 (international); passcode: 21809164. Participants should plan to register at least 10 minutes before the conference call begins. The presentation that will be reviewed as part of the conference call will be available on the company's website at www.cohenandsteers.com under "Company - Press Releases."

A replay of the call will be available for two weeks starting at approximately 12:00 p.m. (ET) on April 21, 2016 and can be accessed at 800-633-8284 (U.S.) or +1-402-977-9140 (international); passcode: 21809164. Internet access to the webcast, which includes audio (listen-only), will be available on the company's website at www.cohenandsteers.com under "Company - Investor Relations." The webcast will be archived on the website for one month.

About Cohen & Steers

Cohen & Steers is a global investment manager specializing in liquid real assets, including real estate securities, listed infrastructure, commodities and natural resource equities, as well as preferred securities and other income solutions. Founded in 1986, the firm is headquartered in New York City, with offices in London, Hong Kong, Tokyo and Seattle.

Forward-Looking Statements

This press release and other statements that Cohen & Steers may make may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which reflect management's current views with respect to, among other things, the company's operations and financial performance. You can identify these forward-looking statements by the use of words such as "outlook," "believes," "expects," "potential," "continues," "may," "will," "should," "seeks," "approximately," "predicts," "intends," "plans," "estimates," "anticipates" or the negative versions of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these forward-looking statements. The company believes that these factors include, but are not limited to, the risks described in the Risk Factors section of the company's Annual Report on Form 10-K for the year ended December 31, 2015 (the Form 10-K), which is accessible on the Securities and Exchange Commission's website at www.sec.gov and on the company's website at www.cohenandsteers.com. These factors are not exhaustive and should be read in conjunction with the other cautionary statements that are included in the company's Form 10-K and other filings with the Securities and Exchange Commission. The company undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.

 

Cohen & Steers, Inc. and Subsidiaries







 Condensed Consolidated Statements of Operations (Unaudited)






 For the Periods









 (in thousands, except per share data)



















 Three Months Ended


 % Change From


March 31,
2016


December 31,
2015


March 31,
2015


December 31,
2015


March 31,
2015

 Revenue










 Investment advisory and administration fees

$

73,088


$

75,269


$

77,752





 Distribution and service fees

4,233


4,120


3,906





 Portfolio consulting and other

2,360


2,282


2,157





 Total revenue

79,681


81,671


83,815


(2.4%)


(4.9%)

 Expenses










 Employee compensation and benefits

28,040


27,440


25,983





 Distribution and service fees

8,702


8,976


9,251





 General and administrative

12,735


13,390


12,463





 Depreciation and amortization

1,897


1,513


1,569





 Total expenses

51,374


51,319


49,266


0.1%


4.3%

 Operating income

28,307


30,352


34,549


(6.7%)


(18.1%)

 Non-operating income










 Interest and dividend income—net

542


560


299





 Gain (loss) from seed investments—net

190


(12,587)


(1,432)





 Other losses

(89)


(51)


(419)





Total non-operating income (loss)

643


(12,078)


(1,552)


*


*

 Income before provision for income taxes

28,950


18,274


32,997


58.4%


(12.3%)

 Provision for income taxes

11,083


12,446


12,226





 Net income

17,867


5,828


20,771


206.6%


(14.0%)

    Less: Net loss attributable to redeemable 
     noncontrolling interest

216


51


45





 Net income attributable to common 
   stockholders

$

18,083


$

5,879


$

20,816


207.6%


(13.1%)












 Earnings per share attributable to common
  stockholders











 Basic

$

0.39


$

0.13


$

0.46


205.7%


(14.2%)

 Diluted

$

0.39


$

0.13


$

0.45


206.1%


(13.5%)











Dividends declared per share










Quarterly

$

0.26


$

0.25


$

0.25


4.0%


4.0%

Special

$


$

0.50


$


*


*












 Weighted average shares outstanding











Basic

45,808



45,524


45,241





Diluted

46,195



45,969


45,980















* Not meaningful










 

Cohen & Steers, Inc. and Subsidiaries

Assets Under Management (Unaudited)

By Investment Vehicle

For the Periods

(in millions)


Three Months Ended


 % Change From


March 31,
2016


December 31,
2015


March 31,
2015


December 31,
2015


March 31,
2015

Institutional Accounts











Assets under management, beginning of period

$

26,105


$

24,645


$

26,201





    Inflows

1,772


1,023


925





    Outflows

(582)


(475)


(1,004)





    Net inflows (outflows)

1,190


548


(79)





    Market appreciation

1,215


1,495


1,121





    Distributions

(653)


(583)


(539)





    Total increase

1,752


1,460


503





Assets under management, end of period

$

27,857


$

26,105


$

26,704


6.7%


4.3%

Percentage of total assets under management

50.6%


49.6%


48.8%





Average assets under management for period

$

25,775


$

25,655


$

27,080


0.5%


(4.8%)













Open-end Funds












Assets under management, beginning of period

$

17,460


$

16,141


$

17,131





    Inflows

2,022


2,263


1,726





    Outflows

(1,698)


(1,319)


(1,475)





    Net inflows

324


944


251





    Market appreciation

495


871


796





    Distributions

(133)


(496)


(116)





    Total increase

686


1,319


931





Assets under management, end of period

$

18,146


$

17,460


$

18,062


3.9%


0.5%

Percentage of total assets under management

33.0%


33.2%


33.0%





Average assets under management for period

$

17,099


$

17,114


$

17,963


(0.1%)


(4.8%)














Closed-end Funds












Assets under management, beginning of period

$

9,029


$

8,958


$

9,805





    Inflows







    Outflows

(86)


(34)






    Net outflows

(86)


(34)






    Market appreciation

235


237


222





    Distributions

(122)


(132)


(127)





    Total increase

27


71


95





Assets under management, end of period

$

9,056


$

9,029


$

9,900


0.3%


(8.5%)

Percentage of total assets under management

16.4%


17.2%


18.1%





Average assets under management for period

$

8,743


$

9,198


$

9,978


(4.9%)


(12.4%)













Total












Assets under management, beginning of period

$

52,594


$

49,744


$

53,137





    Inflows

3,794


3,286


2,651





    Outflows

(2,366)


(1,828)


(2,479)





    Net inflows

1,428


1,458


172





    Market appreciation

1,945


2,603


2,139





    Distributions

(908)


(1,211)


(782)





    Total increase

2,465


2,850


1,529





Assets under management, end of period

$

55,059


$

52,594


$

54,666


4.7%


0.7%

Average assets under management for period

$

51,617


$

51,967


$

55,021


(0.7%)


(6.2%)












Current period amounts have been revised to reflect distributions separately and dividend reinvestments as inflows. Prior period amounts have been reclassified to conform with current period presentation.

 

Cohen & Steers, Inc. and Subsidiaries

Assets Under Management - Institutional Accounts (Unaudited)

By Account Type

For the Periods

(in millions)


Three Months Ended


 % Change From


March 31,
2016


December 31,
2015


March 31,
2015


December 31,
2015


March 31,
2015

Subadvisory










Assets under management, beginning of period

$

18,540


$

17,500


$

18,857





    Inflows

1,073


841


727





    Outflows

(260)


(353)


(617)





    Net inflows

813


488


110





    Market appreciation

882


1,135


814





    Distributions

(653)


(583)


(539)





    Total increase

1,042


1,040


385





Assets under management, end of period

$

19,582


$

18,540


$

19,242


5.6%


1.8%

Percentage of institutional assets under management

70.3%


71.0%


72.1%





Average assets under management for period

$

18,057


$

18,180


$

19,526


(0.7%)


(7.5%)












Advisory










Assets under management, beginning of period

$

7,565


$

7,145


$

7,344





    Inflows

699


182


198





    Outflows

(322)


(122)


(387)





    Net inflows (outflows)

377


60


(189)





    Market appreciation

333


360


307





    Total increase

710


420


118





Assets under management, end of period

$

8,275


$

7,565


$

7,462


9.4%


10.9%

Percentage of institutional assets under management

29.7%


29.0%


27.9%





Average assets under management for period

$

7,718


$

7,475


$

7,554


3.3%


2.2%











Total Institutional Accounts










Assets under management, beginning of period

$

26,105


$

24,645


$

26,201





    Inflows

1,772


1,023


925





    Outflows

(582)


(475)


(1,004)





    Net inflows (outflows)

1,190


548


(79)





    Market appreciation

1,215


1,495


1,121





    Distributions

(653)


(583)


(539)





    Total increase

1,752


1,460


503





Assets under management, end of period

$

27,857


$

26,105


$

26,704


6.7%


4.3%

Average assets under management for period

$

25,775


$

25,655


$

27,080


0.5%


(4.8%)











Current period amounts have been revised to reflect distributions separately and dividend reinvestments as inflows. Prior period amounts have been reclassified to conform with current period presentation.

 

Cohen & Steers, Inc. and Subsidiaries










Assets Under Management (Unaudited)










By Investment Strategy










For the Periods










(in millions)











Three Months Ended


 % Change From


March 31,
2016


December 31,
2015


March 31,
2015


December 31,
2015


March 31,
2015

U.S. Real Estate










Assets under management, beginning of period

$

27,814


$

25,812


$

28,357





    Inflows

1,739


1,679


1,168





    Outflows

(1,004)


(673)


(1,078)





    Net inflows

735


1,006


90





    Market appreciation

1,227


1,976


1,430





    Distributions

(707)


(980)


(588)





    Total increase

1,255


2,002


932





Assets under management, end of period

$

29,069


$

27,814


$

29,289


4.5%


(0.8%)

Percentage of total assets under management

52.8%


52.9%


53.6%





Average assets under management for period

$

26,990


$

27,195


$

29,627


(0.8%)


(8.9%)











Global/International Real Estate










Assets under management, beginning of period

$

9,476


$

9,379


$

10,184





    Inflows

777


155


275





    Outflows

(468)


(449)


(702)





    Net inflows (outflows)

309


(294)


(427)





    Market appreciation

409


448


488





    Distributions

(42)


(57)


(56)





    Total increase

676


97


5





Assets under management, end of period

$

10,152


$

9,476


$

10,189


7.1%


(0.4%)

Percentage of total assets under management

18.4%


18.0%


18.6%





Average assets under management for period

$

9,444


$

9,605


$

10,429


(1.7%)


(9.4%)













Preferred Securities










Assets under management, beginning of period

$

7,705


$

6,877


$

6,342





    Inflows

1,135


1,145


709





    Outflows

(661)


(427)


(467)





    Net inflows

474


718


242





    Market appreciation

25


209


228





    Distributions

(105)


(99)


(80)





    Total increase

394


828


390





Assets under management, end of period

$

8,099


$

7,705


$

6,732


5.1%


20.3%

Percentage of total assets under management

14.7%


14.6%


12.3%





Average assets under management for period

$

7,799


$

7,343


$

6,597


6.2%


18.2%











Global Listed Infrastructure










Assets under management, beginning of period

$

5,147


$

5,212


$

5,697





    Inflows

91


201


209





    Outflows

(178)


(136)


(157)





    Net (outflows) inflows

(87)


65


52





    Market appreciation (depreciation)

253


(75)


(4)





    Distributions

(41)


(55)


(44)





    Total increase (decrease)

125


(65)


4





Assets under management, end of period

$

5,272


$

5,147


$

5,701


2.4%


(7.5%)

Percentage of total assets under management

9.6%


9.8%


10.4%





Average assets under management for period

$

5,002


$

5,324


$

5,685


(6.0%)


(12.0%)











Other










Assets under management, beginning of period

$

2,452


$

2,464


$

2,557





    Inflows

52


106


290





    Outflows

(55)


(143)


(75)





    Net (outflows) inflows

(3)


(37)


215





    Market appreciation (depreciation)

31


45


(3)





    Distributions

(13)


(20)


(14)





    Total increase (decrease)

15


(12)


198





Assets under management, end of period

$

2,467


$

2,452


$

2,755


0.6%


(10.5%)

Percentage of total assets under management

4.5%


4.7%


5.0%





Average assets under management for period

$

2,382


$

2,500


$

2,683


(4.7%)


(11.2%)














Total










Assets under management, beginning of period

$

52,594


$

49,744


$

53,137





    Inflows

3,794


3,286


2,651





    Outflows

(2,366)


(1,828)


(2,479)





    Net inflows

1,428


1,458


172





    Market appreciation

1,945


2,603


2,139





    Distributions

(908)


(1,211)


(782)





    Total increase

2,465


2,850


1,529





Assets under management, end of period

$

55,059


$

52,594


$

54,666


4.7%


0.7%

Average assets under management for period

$

51,617


$

51,967


$

55,021


(0.7%)


(6.2%)











Current period amounts have been revised to reflect distributions separately and dividend reinvestments as inflows. Prior period amounts have been reclassified to conform with current period presentation.

 


 

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/cohen--steers-reports-first-quarter-2016-results-300254958.html

SOURCE Cohen & Steers, Inc.

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