A PA AM Reaches a Record $527.2B In AUM
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Monday, November 04, 2019

A PA AM Reaches a Record $527.2B In AUM

A publicly traded, acquisitive asset manager's AUM reached at record $572.2 billion last quarter.

John Christopher Donahue
Federated Investors
President, CEO & Chairman
Tom Donahue , chief financial officer of Federated Investors, states on the Pittsburgh-based firm's Q3 2019 earnings call (as transcribed by Seeking Alpha) that "Total revenue was up about $19 million or 6% from the prior quarter due mainly to $13.6 million of higher money market revenue, primarily from higher average money market assets. And $3.9 million of higher revenue from an additional day in Q3. Performance fees of $1.4 million were recorded in Q3, no performance fees were recorded in Q2. Revenue was up about $32 million or 10% compared to Q3 of last year due mainly to higher money market revenue of $37 million, partially offset by decrease in revenue of $1.7 million related to lower average equity assets.”

Chris Donahue, CEO of Federated, talked about U.S. opportunities for London-based Hermes Fund Managers Limited, which Federated bought a 67-percent stake in last year. (He notes that Hermes' assets slipped to $44 billion at the end of Q3 from $45.7 billion at the end of Q2.)

"On the international side, we've had a good response from clients for the initial funds developed for US distribution that are sub advised by Hermes. Assets in these funds were just over $60 million at the end of the third quarter with about half of that being externally sourced," Donahue states. "We are evaluating further US mutual fund launches using Hermes strategies."

According to the Federated earnings report, total AUM climbed to a record $527.2 billion on Sept. 30, 2019, up $90.0 billion or 21 percent from $437.2 billion on Sept. 30, 2018, and up $25.0 billion or 5 percent from $502.2 billion on June 30, 2019.

As an overall, Federated Investors beat analysts' GAAP EPS expectations by $0.07.

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