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New York, NY - AXA Financial, Inc. (NYSE-AXF) today reported its operating results for the third quarter
and nine months ended September 30, 1999. For the quarter, after-tax operating earnings applicable
to common shares were $237.0 million, or $0.54 per diluted share, compared with $141.0 million, or $0.31
per diluted share, reported for the third quarter of 1998. Operating earnings per share (EPS) for the quarter
increased by 74% over the quarter of a year ago. Net revenues reached $2.3 billion, an increase of 59%
over 1998's third quarter of $1.5 billion.
At the close of the third quarter, total assets under management rose to a record $394.4 billion, or 29%
above the year-ago level. The overall return-on-equity (ROE) was 16.4% for the latest quarter.
For the nine months ended September 30, 1999, after-tax operating earnings applicable to common shares
rose to a record $730.5 million, or $1.65 per diluted share, compared with $574.4 million, or $1.27 per
diluted share, reported in the comparable period of last year. EPS for the first nine months of 1999
increased by 30% over the comparable period last year. ROE was 17.9% for the first nine months of 1999.
"We continue to see strong performances as each of our businesses made important contributions to these
results. All three of our businesses have achieved in excess of 24% operating income growth for the
nine-month 1999 period and consolidated EPS results already exceed the record 12-month results of 1998,"
commented Edward D. Miller, President and Chief Executive Officer.
"In the third quarter, we implemented a number of strategic actions," Mr. Miller continued. "In early
September, we changed the name of the holding company to 'AXA Financial, Inc.' from 'The Equitable Companies
Incorporated' and, subsequently, began trading under the new stock symbol 'AXF.' This name change better
reflects the global, diversified nature of our businesses and its growing asset gathering and distribution
capabilities. We continue to realize significant benefits from integration of our insurance, investment
banking and asset management businesses, and are a working example of financial services reform.
"During the third quarter, we took actions that underscored our confidence in the Company's growth
strategy and demonstrated a disciplined approach to managing capital. We continued to make investments that
support growth by introducing new offerings with strong profit potential and further expanded key international
markets through DLJ, DLJdirect and Alliance Capital. Additionally, Equitable Life made its first dividend
payment to AXA Financial and AXA Financial repurchased over 5.6 million of its common shares," added Mr.
Miller.
The quarter included strong insurance variable annuity sales, record merger and acquisition (M&A)
activity at DLJ and exceptional market share and asset growth of Alliance's mutual funds. Other third
quarter highlights included:
- Consolidated gross product sales for the quarter were $15 billion, up over 50% from last year.
Year-to-date, this amount was $45 billion;
- Consolidated assets under management were $394.4 billion, a new record, and up $88 billion
or 29% from the September 30, 1998 amounts;
- A two-for-one stock split was implemented in the quarter;
- The insurance operation began national rollout of its Asset Management Account (AMA);
- DLJ increased M&A market share in the quarter;
- DLJdirect began offering its online brokerage services in the United Kingdom;
- Alliance Capital continued to be among the leaders in mutual fund sales within the
non-proprietary universe.
For the third quarter of 1999, net income, which includes net realized gains (losses) and non-recurring
items, was $231.6 million, or $0.51 per diluted share, compared with $139.8 million, or $0.31 per diluted
share reported in the 1998 third quarter. Net income for the first nine months of 1999 was $833.7 million,
or $1.82 per diluted share, compared with $655.2 million, or $1.42 per diluted share for the year ago period.
DLJ's Nine Month Net Income Exceeded Record Full Year 1997 Results
After-tax reported earnings at DLJ -- before minority interests and other expenses -- rose to $122.2
million for the 1999 third quarter, up significantly from the $25.7 million reported for the similar period
of 1998. For the nine-month period ended September 30, 1999, DLJ's net income increased 36% to
$409.5 million.
DLJ's contribution to AXA Financial's third quarter results was $77.5 million, versus $11.2 million last
year. For the first nine months of 1999, the contribution from DLJ was $268.2 million, as compared with
$195.7 million in the comparable period a year ago.
"DLJ's strong quarter reflects its continuing success in achieving a diverse and balanced business
mix. M&A fees nearly doubled in the quarter to record levels. DLJ ranks fifth in completed global M&A
assignments and fourth in completed U.S. assignments, up dramatically from eleventh place in both measures
a year ago," said Mr. Miller. "DLJ significantly increased its market share as an underwriter of high-yield
bonds. During the quarter, DLJ underwrote $4.3 billion of new high-yield issues to earn first-place
ranking and a market share of 25%, despite challenging conditions in the high-yield market.
"For the third quarter, overall revenues from DLJ's international businesses increased 181% over
the comparable quarter last year," continued Mr. Miller. "In preparation for future growth in the global
capital markets, DLJ expanded its research, sales and trading operations in overseas markets. In addition,
the firm opened a new banking office in Frankfurt and broadened its coverage in Europe and Asia.
Pershing, DLJ's correspondent clearing service, increased revenues in the third quarter of 1999 by
22%. Assets in client accounts were $345 billion as of the end of the third quarter of 1999 with 3.0
million active client accounts, up from $279 billion with 2.5 million active accounts at year-end 1998.
"Pershing continues to maintain an industry leadership position with a 9.2% average market share for the
third quarter of 1999," noted Mr. Miller.
DLJdirect Posts 82% Increase in Revenues
DLJdirect, DLJ's online brokerage service, reported total revenues of $54.9 million for the third
quarter of 1999, representing an 82% year-over-year increase. As of September 30, 1999, DLJdirect
had 699,000 customer accounts, 41% more than the third quarter a year ago. Active customer accounts at the
end of the third quarter of 1999 numbered 302,000, a 53 % increase versus the third quarter of 1998.
During the third quarter of 1999, DLJdirect opened 43,000 new customer accounts and 25,000 new active
accounts.
"Customer asset growth in the latest quarter reached a record $14.2 billion, up from $6.7 billion from the
year ago quarter," noted Mr. Miller. "Anticipating strong growth in overseas online brokerage services,
DLJdirect began operations in the United Kingdom. This continues to build its presence in new
geographic markets following Japan, where DLJdirect is receiving very favorable customer
response," added Mr. Miller.
Alliance Capital Reports Record Income
After-tax operating earnings - before minority interests and other expenses - at Alliance Capital
Management - reached $101.7 million, or 45% higher than the $70.2 million reported for the third quarter
of 1998. Net income for the nine months ended September 30, 1999 was $296.9 million versus $215.1 million
a year earlier. These net income amounts are records for both periods.
Total assets under management at the end of the period totaled $317.3 billion, 31% above 1998's third
quarter.
Alliance's contribution to AXA Financial's third quarter results was a record $30.9 million, versus
$28.0 million last year. For the first nine months of 1999, the contribution from Alliance was also a
record at $85.5 million, versus $65.8 million in the comparable period a year ago.
"Alliance continues to produce strong new sales in both its mutual fund and institutional businesses.
New mutual fund sales were $12.3 billion in the quarter, as Alliance remains among the leaders in net
non-proprietary U.S. sales as of August 1999. Sales in the institutional business exceeded $2 billion in
the quarter, and it has won 185 new mandates in the first nine months of 1999. Alliance continued to expand
its reach in the important Japanese and European markets in the latest quarter," commented Mr. Miller.
About AXA Financial
AXA Financial, Inc. is one of the world's premier financial services organizations through its family
of strong, well recognized brands: The Equitable Life Assurance Society, AXA Advisors, Donaldson, Lufkin
& Jenrette (DLJ), DLJdirect, Pershing and Alliance Capital Management. AXA Financial is a member
of the global AXA Group, which has operations in over 60 countries and more than $700 billion in assets
under management.
Condensed Consolidated Statement of Earnings
After-tax Operating Earnings
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