MutualFundWire.com: Federated Clears Hurdle

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Wednesday, April 24, 2002

Federated Clears Hurdle

Federated Investors grew brought $1.2 billion of net sales into its funds in the first quarter. The growth added to the Pittsburgh fund manager's $38 billion asset base in its funds. Altogether the firm now manages $194 billion of assets.

J. Christopher Donahue, president and chief executive officer, pointed to the financial results as proof of the Federated's ability "to produce growth and shareholder value of changing market cycles."

"With competitive performance in key equity and fixed-income sectors, coupled with a strong distribution team, Federated is well positioned for future growth," added Donahue.

The fund firm was the first this week to meet analyst earnings estimates.

Strong selling funds included the Federated bond funds (Ultrashort Bond, Government Ultrashort Bond, High Yield Trust) and a number of stock funds, Capital Appreciation, Kaufmann and Stock Trust.

"Market demand has clearly shifted over the past two years, with investors demonstrating a preference for blend and value equity products and a renewed interest in fixed-income," said Donahue.

The new assets raised investment advisory fees at Federated 20% to $116 million from $97 million a year prior.

Altogether, the firm's bottom line rose to $0.44 cents per share, up from $0.35 a year ago. The firm also said it is increasing its quarterly dividend by 24 percent and that it plans to buy back 689,570 shares.

Federated Investors
Changes in Fund Assets ($ mil)
Quarter Ended March 31	2002	2001
Equity Funds
Beginning Assets	$20,760	$20,641
Sales	1,563	1,668
Redemptions	-1,306	-1,738
Net sales (redemptions)	257	-70
Net exchanges	36	-65
Other*	72	-2,257
Ending Assets	$21,125	$18,249
Fixed-Income Funds
Beginning Assets	$17,378	$14,268
Sales	3,182	1,959
Redemptions	-2,169	-1,398
Net sales	1,013	561
Net exchanges	34	-13
Other*	108	296
Ending Assets	$18,533	$15,112
Source: Federated Investors

Federated Investors Managed Assets
MANAGED ASSETS ($ mm)	31-Mar-02	31-Dec-01	30-Sep-01	30-Jun-01	31-Mar-01
By Asset Class
Equity	$23,025	$22,598	$20,497	$24,269	$19,957
Fixed-income	22,370	21,055	19,945	18,695	18,757
Money market	132,205	136,034	123,203	117,810	107,733
Total Managed Assets	$177,600	$179,687	$163,645	$160,774	$146,447

By Product Type
Funds:
Equity	$21,125	$20,760	$18,840	$22,461	$18,249
Fixed-income	18,533	17,378	16,410	15,179	15,112
Money market	131,109	135,092	122,263	117,035	106,990
Total Fund Assets	$170,767	$173,230	$157,513	$154,675	$140,351

Separate Accounts:
Equity	$1,900	$1,838	$1,657	$1,808	$1,708
Fixed-income	3,837	3,677	3,535	3,516	3,645
Money market	1,096	942	940	775	743
Total Separate Accounts	$6,833	$6,457	$6,132	$6,099	$6,096
Total Managed Assets	$177,600	$179,687	$163,645	$160,774	$146,447

By Market
Trust	$98,228	$96,568	$86,983	$83,630	$76,981
Broker/dealer	45,899	46,592	43,259	44,699	43,845
Institutional	24,472	27,531	25,014	23,563	19,173
International	1,366	1,367	1,312	1,340	1,351
Other	7,635	7,629	7,077	7,542	5,097
Total Managed Assets	$177,600	$179,687	$163,645	$160,774	$146,447

AVERAGE MANAGED ASSETS	Quarter Ended
(in millions)	March 31,	March 31,	%	Dec. 31,	%
	2002	2001	Change	2001	Change
By Asset Class
Equity	$22,334	$21,620	3.30%	$21,792	2.50%
Fixed-income	21,841	18,685	16.9	21,010	4
Money market	139,417	106,258	31.2	133,192	4.7
Total Average Managed Assets	$183,592	$146,563	25.30%	$175,994	4.30%
Source: Federated Investors