Thanks in part to strategic acquisitions and restructuring efforts completed or announced over the past several months, Legg Mason Inc.’s net income jumped 51 percent during the quarter that ended June 30 compared to the comparable period last year.
The Baltimore-based money manager reported Thursday that net income was $72.2 million, or 61 cents per diluted share, for its first quarter of fiscal 2015.
By comparison, net income during the first quarter of 2014 was $47.8 million, or 38 cents per diluted share. And in the most recent prior period — the fourth quarter of 2014 — Legg earned $68.9 million, or 58 cents per diluted share.
The results indicate that Legg Mason is continuing its turnaround after a brutal half-decade marred by net outflows in the billions of dollars and devastating losses quarter after quarter.
The company has been on a strong path forward since President and CEO Joseph A. Sullivan took over in February of 2013 — or even since he became interim CEO a few months before that.
Assets under management are climbing — reaching $704.3 billion as of June 30, which is 9 percent higher than the comparable quarter last year — and long-term cash flows are finally positive.
Legg reported fixed-income inflows of $2.5 billion for the quarter, tempered by $1.8 billion in equity outflows.
The company had $704.3 billion in assets under management as of June 30, up 9 percent from the end of the same quarter last year. It completed its acquisition of QS Investors, a New York-based investment firm, during the quarter and announced a plan to sell one of its divisions, the Legg Mason Investment Counsel & Trust Co., to Stifel Financial Corp.
“Net flows were as expected, and we are encouraged” on momentum for operating and money flows, Citigroup Inc. analyst William Katz wrote in a note today, reiterating his “buy” recommendation on the stock.
Last week, Legg also announced an agreement to purchase Martin Currie, a Scotland-based equity manager.
Sullivan said those moves will fill “glaring” gaps in Legg Mason’s investment offerings while enabling the firm’s seven core affiliates to focus on their own specialized products and services.
Operating revenues of $639.9 million were up 2 percent from the prior quarter and up 4 percent from the comparable period last year. And operating expenses during the first quarter of 2015 were $574.3 million, 2 percent less than the first quarter of 2014.
The board of directors also announced a quarterly cash dividend on its common stock of 16 cents per share.
Bloomberg contributed to this story.