Money manager AllianceBernstein LP
Shares of the New York-based company, which is controlled by French insurer AXA
Since becoming chairman and chief executive in December 2008, Peter Kraus, a former Goldman Sachs partner, has struggled to revive a company that was reeling when he arrived. AllianceBernstein's assets under management and stock price are down 12 percent and 14 percent, respectively, during his tenure.
In a year of extremely volatile markets and risk aversion on the part of investors, it was a difficult year for active managers to outperform, Kraus told analysts and investors on a conference call on Friday. Performance in our largest equity services disappointed and we ended up with greater net outflows in 2011 than in 2010.
The company also took a noncash charge of $587 million related to unrecognized deferred incentive compensation.
Earnings excluding one-time items dropped to $37 million from $139 million a year earlier. That gave the company earnings per unit of 7 cents. Analysts on average had expected 19 cents, according to Thomson Reuters I/B/E/S.
Net revenue fell 20 percent to $625 million. Analysts had expected $650 million.
The company reported $406 billion in assets under management at the end of 2011, compared with $478 billion at the end of 2010. Net outflows in the fourth quarter were $13.2 billion.
Assets under management rose 1 percent from the end of the third quarter, and showed a 4 percent improvement in January from the end of 2011.
Shares of AllianceBernstein were down 6 percent at $15.50 in premarket trading.
The company has been hurt somewhat by moves made by AXA.
During 2011, AXA sold its Canadian and Australian businesses. AllianceBernstein managed about $16 billion for them and expects to lose most of these assets over time.
In the fourth quarter, it had outflows associated with those dispositions of nearly $4 billion, representing about $5 million in revenue.
The company said it expects to see another $6 billion in outflows related to the Axa asset sales in the first half of 2012.
(Reporting by Tim McLaughlin in Boston; Editing by Lisa Von Ahn and John Wallace)