SOURCE: SEI

SEI

April 27, 2011 08:00 ET

SEI Reports First-Quarter 2011 Financial Results

OAKS, PA--(Marketwire - Apr 27, 2011) - SEI Investments Company (NASDAQ: SEIC) today announced financial results for first-quarter 2011. Diluted earnings per share were $.31 in first-quarter 2011 and first-quarter 2010. These results include gains from Structured Investment Vehicles (SIV) securities of $6.9 million or approximately $.02 diluted earnings per share in first quarter 2011 compared to $17.3 million or approximately $.05 diluted earnings per share in first-quarter 2010.



Consolidated Overview                          For the Three Months
(In thousands, except earnings per                Ended March 31,
 share)                                    2011        2010         %
                                        ----------- ----------- ---------

Revenues                                $   232,493 $   221,535         5%
Net Income attributable to SEI               57,728      59,420        (3%)
Diluted Earnings Per Share              $      0.31 $      0.31         -



"Compared to a year ago, our first-quarter results reflect improved capital markets and growing acceptance for all of our services," said Alfred P. West, Jr., SEI Chairman and CEO. "First-quarter profits reflect increased spending on both development and operational support for the Global Wealth Platform as we increased development for U.S. entry and enhanced our U.K. services. We are confident we are well-positioned for long-term growth in both of these markets."


Summary of First-Quarter Results by Business Segment

(In thousands)                               For the Three Month Period
                                                   Ended  March 31,
                                             2011       2010         %
                                           ---------  ---------  --------
Private Banks:
   Revenues                                $  86,709  $  87,121         -
   Expenses                                   82,403     77,599         6%
                                           ---------  ---------
   Operating Profit                        $   4,306  $   9,522       (55%)
   Operating Margin                                5%        11%
Investment Advisors:
   Revenues                                   48,108     45,463         6%
   Expenses                                   27,040     27,583        (2%)
                                           ---------  ---------
   Operating Profit                           21,068     17,880        18%
   Operating Margin                               44%        39%
Institutional Investors:
   Revenues                                   53,185     50,339         6%
   Expenses                                   26,953     26,380         2%
                                           ---------  ---------
   Operating Profit                           26,232     23,959         9%
   Operating Margin                               49%        48%
Investment Managers:
   Revenues                                   43,441     37,610        16%
   Expenses                                   27,999     24,559        14%
                                           ---------  ---------
   Operating Profit                           15,442     13,051        18%
   Operating Margin                               36%        35%
Investments in New Businesses:
   Revenues                                    1,050      1,002         5%
   Expenses                                    3,125      2,661        17%
                                           ---------  ---------
   Operating Loss                             (2,075)    (1,659)      N/A
   Operating Margin                              N/A        N/A
Totals:
   Revenues                                $ 232,493  $ 221,535         5%
   Expenses                                  167,520    158,782         6%
   Corporate overhead expenses                10,648      9,717        10%
   Noncontrolling interest reflected in
    segments                                    (272)      (309)      N/A
                                           ---------  ---------
   Income from operations                  $  54,597  $  53,345         2%



First-Quarter Business Commentary:

--  Sales events, net of client losses, during first-quarter 2011 totaled
    $13.8 million and are expected to generate net annualized recurring
    revenues of approximately $12.5 million.
--  Asset management, administration, and distribution fee revenues
    increased primarily due to higher asset balances under management and
    administration from existing clients because of improved capital
    markets.
--  Assets under management increased $6.9 billion to $179.2 billion at
    March 31, 2011, as compared to $172.3 billion at December 31, 2010.
--  Total consolidated expenses in first-quarter 2011 reflect increased 
    spending on the Global Wealth Platform (GWP).  During the first-quarter
    2011, we incurred additional costs related to production and
    maintenance to run the platform as well as additional costs associated
    with the ongoing development of GWP.  We estimate these additional
    costs to be approximately $3.0 million above fourth-quarter 2010
    levels.
--  Net income attributable to SEI and diluted earnings per share results
    include gains from SIV securities of $6.9 million or approximately $.02
    diluted earnings per share in first-quarter 2011 compared to $17.3
    million or approximately $.05 diluted earnings per share in first-
    quarter 2010.  Excluding the gains from SIV securities, diluted
    earnings per share were $.29 in first-quarter 2011 compared to $.26 in
    first-quarter 2010.
--  In the first-quarter 2011, SEI purchased 1,725,000 shares of its common
    stock for $39.5 million.

Earnings Conference Call

A conference call to review earnings is scheduled for 2:00 PM ET on April 27, 2011. Investors may listen to the call at www.seic.com/investors or listen at www.earnings.com, a service of Thomson Streetevents. The call may also be accessed at numerous financial services web sites including AOL and Yahoo. Investors may also listen to replays at these web sites, or by telephone at (USA) 1-800-475-6701; (International) 320-365-3844, access code 199003.

About SEI

SEI (NASDAQ: SEIC) is a leading global provider of investment processing, fund processing, and investment management business outsourcing solutions that help corporations, financial institutions, financial advisors, and ultra-high-net-worth families create and manage wealth. As of March 31, 2011, through its subsidiaries and partnerships in which the company has a significant interest, SEI manages or administers $429 billion in mutual fund and pooled assets or separately managed assets, including $179 billion in assets under management and $250 billion in client assets under administration. For more information, visit www.seic.com.

Many of the statements in this release may be considered "forward looking statements" and include discussions about future operations, strategies and financial results. Forward-looking statements are based upon estimates and assumptions that involve risks and uncertainties, many of which are beyond our control or are subject to change. Although we believe our assumptions are reasonable, they could be inaccurate. Our actual future revenues and income could differ materially from our expected results. We have no obligation to publicly update or revise any forward-looking statements.


                          SEI INVESTMENTS COMPANY
                  CONSOLIDATED STATEMENTS OF OPERATIONS
                  (In thousands, except per share data)
                                (Unaudited)

                                                      Three Months Ended
                                                          March 31,
                                                    ----------------------
                                                       2011        2010
                                                    ----------  ----------

Asset management, admin. and distribution fees      $  167,504  $  152,938
Information processing and software servicing fees      55,824      58,626
Transaction-based and trade execution fees               9,165       9,971
                                                    ----------  ----------

Total revenues                                         232,493     221,535

Subadvisory, distribution and other asset mgmt
 costs                                                  26,296      25,583
Software royalties and other information processing
 costs                                                   7,017       6,074
Brokerage commissions                                    6,581       7,425
Compensation, benefits and other personnel              71,025      67,216
Stock based compensation                                 3,732       6,657
Consulting, outsourcing and professional fees           25,998      20,707
Data processing and computer related                    11,303       9,928
Facilities, supplies and other costs                    14,102      13,494
Amortization                                             6,231       5,900
Depreciation                                             5,611       5,206
                                                    ----------  ----------

Total expenses                                         177,896     168,190

Income from operations                                  54,597      53,345

Net gain on investments                                  7,278      17,479
Interest and dividend income                             1,544       1,700
Interest expense                                          (204)       (471)
Equity in earnings of unconsolidated affiliate          28,949      24,074
                                                    ----------  ----------

Income before taxes                                     92,164      96,127

Income taxes                                            34,124      36,269
                                                    ----------  ----------

Net income                                              58,040      59,858
                                                    ----------  ----------

Less: Net income attributable to noncontrolling
 interest                                                 (312)       (438)
                                                    ----------  ----------

Net income attributable to SEI                      $   57,728  $   59,420
                                                    ----------  ----------

Diluted earnings per common share                   $     0.31  $     0.31
                                                    ----------  ----------

Shares used to calculate diluted
   earnings per common share                           188,495     191,062
                                                    ----------  ----------

Basic earnings per common share                     $     0.31  $     0.31
                                                    ----------  ----------

Shares used to calculate basic
   earnings per common share                           185,787     189,948
                                                    ==========  ==========





                          SEI INVESTMENTS COMPANY
                         CONDENSED BALANCE SHEETS
                              (In thousands)


                                                  (Unaudited)
                                                    March 31,  December 31,
                                                      2011         2010
                                                  ------------ ------------
Assets

Cash and short-term investments                   $    498,039 $    496,292
Restricted cash                                          4,000        4,000
Receivables, net                                       162,186      165,772
Securities owned                                        20,009            -
Other current assets                                    18,513       17,655
                                                  ------------ ------------

     Total current assets                              702,747      683,719

Property and equipment, net                            142,333      140,568
Marketable securities                                  148,384      179,364
Capitalized software, net                              299,006      294,332
Investment in unconsolidated affiliate                  69,237       64,409
Other assets, net                                       16,328       14,831
                                                  ------------ ------------

     Total assets                                 $  1,378,035 $  1,377,223
                                                  ============ ============



Liabilities

Current liabilities                               $    125,066 $    127,600
Long-term debt                                          60,000       95,000
Deferred income taxes                                   94,074       92,253
Long-term liabilities                                    5,939        5,645

Total SEI Investments Company shareholders'
 equity                                              1,077,069    1,041,570
Noncontrolling interest                                 15,887       15,155
                                                  ------------ ------------
Total Equity                                         1,092,956    1,056,725

     Total liabilities and equity                 $  1,378,035 $  1,377,223
                                                  ============ ============






                          SEI INVESTMENTS COMPANY
                              ASSET BALANCES
                              (In millions)
                               (Unaudited)




                          Mar. 31,  Jun. 30,  Sep. 30,  Dec. 31,  Mar. 31,
                            2010      2010      2010      2010      2011
                          --------- --------- --------- --------- ---------
Private Banks:
   Equity/Fixed Income
    prgms.                $  12,635 $  11,769 $  12,842 $  13,512 $  14,809
   Collective Trust Fund
    prgm.                     1,023       640       615       626       576
   Liquidity funds            5,329     5,175     5,034     5,120     5,217
                          --------- --------- --------- --------- ---------
   Total assets under
    mgmt.                 $  18,987 $  17,584 $  18,491 $  19,258 $  20,602

   Client assets under
    admin.                   11,429    10,335    10,557    10,672    11,227
                          --------- --------- --------- --------- ---------
   Total assets           $  30,416 $  27,919 $  29,048 $  29,930 $  31,829

Investment Advisors:
   Equity/Fixed Income
    prgms.                $  26,222 $  23,699 $  26,091 $  27,680 $  28,296
   Collective Trust Fund
    prgm.                     2,284     2,066     2,028     1,820     1,618
   Liquidity funds            1,731     2,635     2,253     1,641     1,551
                          --------- --------- --------- --------- ---------
   Total assets under
    mgmt.                 $  30,237 $  28,400 $  30,372 $  31,141 $  31,465

Institutional Investors:
   Equity/Fixed Income
    prgms.                $  45,891 $  43,506 $  47,667 $  48,699 $  51,287
   Collective Trust Fund
    prgm.                       657       643       641       623       608
   Liquidity funds            3,198     2,558     3,475     3,382     3,202
                          --------- --------- --------- --------- ---------
   Total assets under
    mgmt.                 $  49,746 $  46,707 $  51,783 $  52,704 $  55,097

Investment Managers:
   Equity/Fixed Income
    prgms.                $       2 $       1 $       1 $       1 $      37
   Collective Trust Fund
    prgm.                     7,639     7,366     7,781     8,177     8,841
   Liquidity funds              447       428       423       313       139
                          --------- --------- --------- --------- ---------
   Total assets under
    mgmt.                 $   8,088 $   7,795 $   8,205 $   8,491 $   9,017

   Client assets under
    admin. (A)              220,807   220,459   227,777   233,079   238,335
                          --------- --------- --------- --------- ---------
   Total assets           $ 228,895 $ 228,254 $ 235,982 $ 241,570 $ 247,352

Investments in New
 Businesses:
   Equity/Fixed Income
    prgms.                $     534 $     496 $     533 $     569 $     598
   Liquidity funds               72        74        82        65        56
                          --------- --------- --------- --------- ---------
   Total assets under
    mgmt.                 $     606 $     570 $     615 $     634 $     654

LSV Asset Management
   Equity/Fixed Income
    prgms.                $  54,189 $  47,822 $  54,492 $  60,058 $  62,370

Consolidated:
   Equity/Fixed Income
    prgms (B)             $ 139,473 $ 127,293 $ 141,626 $ 150,519 $ 157,397
   Collective Trust Fund
    prgm.                    11,603    10,715    11,065    11,246    11,643
   Liquidity funds           10,777    10,870    11,267    10,521    10,165
                          --------- --------- --------- --------- ---------
   Total assets under
    mgmt.                 $ 161,853 $ 148,878 $ 163,958 $ 172,286 $ 179,205

   Client assets under
    admin. (C)              232,236   230,794   238,334   243,751   249,562
                          --------- --------- --------- --------- ---------
   Total assets           $ 394,089 $ 379,672 $ 402,292 $ 416,037 $ 428,767



(A) Client assets under administration in the Investment Managers segment
    include $54.0 billion of assets balances that require limited services
    and therefore are at fee levels below our normal full service assets
    (as of March 31, 2011).
(B) Equity/Fixed Income programs include $2.3 billion of assets invested in
    various asset allocation funds at March 31, 2011.
(C) In addition to the numbers presented, SEI also administers an
    additional $5.1 billion in Funds of Funds assets (as of March 31, 2011)
    on which SEI does not earn an administration fee.


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