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Second Quarter Highlights
- Assets under management up $93 billion over the level
of a year ago
- 20% return on equity in quarter and for past twelve months
- Net revenue growth of 16% in the quarter
New York - AXA Financial, Inc. (NYSE: AXF) today reported
operating results for the quarter and six months ended June
30, 2000.
For the second quarter of 2000, operating earnings per diluted share grew 21%, to $0.74 per share versus $0.61 per share in the prior year quarter. After-tax operating earnings applicable to common shares were $322.4 million compared with $271.3 million for the second quarter of 1999.
In the quarter, total assets under management rose to $483.7 billion, up 24%, or $92.9 billion from June 30, 1999. New assets gathered including investment products, annuities, mutual funds, and life insurance rose 38% to $25.0 billion from the second quarter of 1999.
Return on equity in the quarter was 20%. Net revenue grew 16% to $2.78 billion compared with last year's comparable quarter. Consolidated pre-tax margin before minority interest was 24.2% in the second quarter of 2000 versus 23.4% in last year's second quarter, an 80-basis point (bp) improvement.
"AXA Financial continues to deliver strong growth despite turbulent market conditions in the quarter," said Edward D. Miller, President and Chief Executive Officer of AXA Financial, Inc. "We have made solid earnings gains, while continuing substantial investments for future growth.
"AXA Financial took another major step to diversify and enhance growth in the quarter with the announced pending acquisition of Sanford C. Bernstein," Mr. Miller said. "Bernstein, with over $80 billion in assets under management, will add quality research capabilities, incremental distribution with its successful private client group and value-style funds to our portfolio of services, upon the expected completion of the deal in the fourth quarter."
Six-Month Results
For the six months ended June 30, 2000, operating earnings per diluted share rose 40% to a record $1.55 compared with $1.11 per diluted share in the comparable period last year. After-tax operating earnings applicable to common shares were $680.5 million compared with $493.6 million for the comparable 1999 period.
For the first half of 2000, new assets gathered rose 54% to a record $50.0 billion compared with the same period in 1999. In the first half of 2000, return on equity rose 340 basis points to 21.7% from 1999's comparable six-month period. Net revenue rose 30% to $5.84 billion from $4.49 billion in the similar period in 1999. Consolidated pre-tax margin before minority interest was 24.7% in the first half of 2000, up 170 bp from the comparable prior year period.
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For the second quarter of 2000, AXA Financial's net income, which includes net realized gains (losses) and other non-recurring items, was $291.1 million, or $0.64 per diluted share, compared with $381.0 million, or $0.83 per diluted share, in the 1999 second quarter.
Net income for the first six months of 2000 was $589.7 million, or $1.29 per diluted share, compared with $602.1 million or $1.31 per diluted share for the same period in 1999.
Included in net income for the second quarter of 1999 was an after-tax gain of $193.6 million related to the sale of the DLJdirect tracking stock and an after-tax $85.6 million non-recurring adjustment to deferred acquisition costs.
AXA Client Solutions, AXA Advisors, Equitable
Financial Advisory/Insurance Achieves Record Quarterly Results
- Record ROE in the quarter of 18.8%
- Record quarterly and year-to-date operating earnings with growth of 31% and 27%, respectively
- AXA Asset Accounts (AMA) reach $1.7 billion in client assets
Second quarter operating earnings reached $184.4 million compared with $141.3 million reported in the year-ago quarter. Second quarter 2000 return on equity improved to 18.8% from 15.6% in the comparable 1999 quarter.
Total sales of life insurance, annuity and mutual fund products rose to $3.57 billion in the quarter compared with $3.38 billion in the second quarter of 1999. Annuity sales in the latest quarter were up 4.0% over the second quarter of 1999.
For the six months ended June 30, operating earnings rose 27% to $342.6 million compared with $269.4 million in the same period a year ago. Total sales of life insurance, annuity and mutual fund products in the period increased 15%, while annuities grew 13%. For the six months ended June 30, 2000, return on equity improved to 17.5% from 15.1% in the comparable period.
"Financial Advisory and Insurance achieved record earnings in the quarter as fee income rose 37% along with wider spreads and better margins," said Michael Hegarty, Senior Vice Chairman and Chief Operating Officer of AXA Financial, Inc. "Our transformation to a full advisory business is firmly on track as an increasing number of our advisors are credentialled to provide financial planning services, the AXA Asset Account rollout has been successfully completed and our fee-based financial planning rollout is progressing smoothly. Customer relationships through advice are our primary focus along with gathering and retaining assets."
Donaldson, Lufkin & Jenrette, Pershing, DLJdirect
Investment Banking/Brokerage Produces Solid Results
- Financial Services led overall results in the quarter with pre-tax earnings up 30% from the year-ago quarter
- International net revenues up 39% in the quarter versus last year's second period
- Record overall first half operating results
- Overall net revenues rose 34% in the first six months, reaching $3.4 billion compared with same period last year
For the quarter ended June 30, 2000, DLJ's reported net income was $162.2 million, or $1.15 per diluted share compared with $165.7 million, or $1.14 per diluted share for the year ago quarter. Net revenues rose 9% to $1.6 billion as compared with the same period a year ago. DLJ's reported return on average equity for the latest quarter was 16.5%.
For the six months ended June 30, 2000, DLJ's net income reached $407.4 million, 42% higher than the year-ago period of $287.3 million.
"This was the third best quarter for DLJ, and the best six months ever as DLJ also is benefiting from an increasingly diverse revenue base," Mr. Miller said. "Despite an industry-wide drop in fixed-income underwriting activity, DLJ excelled in many categories. DLJ's Financial Services Group posted a 30% gain in pre-tax profit to $108.6 million in the quarter; Global Equities pre-tax earnings nearly doubled in the quarter; M&A and Private Equity fees led results in the Banking Group for the quarter."
"International net revenues aggregated $312 million, up 39%
in the quarter," Mr. Miller said. "For the first half, these
net revenues were $697 million, up 91% year over year. The
major contributors to the increase were DLJ's international
equities and international investment banking businesses."
DLJdirect's Revenues are Second Best Quarterly Results in Its History
- DLJdirect's second quarter revenues jumped 40% compared with the year-ago quarter
- iNautix Technologies, the e-commerce software developer within DLJdirect, completed its tenth consecutive quarter of record revenues
- First half 2000 revenues reached record levels at DLJdirect
DLJdirect, DLJ's online brokerage service, posted revenues of $84.0 million for the second quarter of 2000, reflecting a 40% increase over the year ago quarter of $60.0 million. Net losses totaled $6.6 million in the quarter compared with net income of $5.1 million in the year-ago period.
Revenues for the six months ended June 30, 2000 reached $198.7 million, 85% higher than last year. Net income for the first half of 2000 was $7.0 million compared with $12.2 million in the same period in 1999.
"DLJdirect's daily trading volume increased 62% year-over-year, active accounts increased 69% and customer assets grew 107%," said Mr. Miller. "Internationally, DLJdirect is recognized as a leading provider of online brokerage services in Japan and the U.K."
Alliance Capital
Investment Management Net Income Jumps 44%
- Revenue growth of 35% and pre-tax margin improvement in the quarter
- Mutual fund gross sales rose 41% over the second quarter of 1999
- Institutional funds add over $4 billion in assets under management with 61 new client mandates
Alliance Capital Management's net income rose 44% to $153.8 million in the latest quarter from the $106.7 million pro-forma total in the second quarter of 1999. Revenues in the quarter were $564.9 million, or up 35% from prior year level. Total assets under management reached $388 billion at June 30, 2000, up 21% from June 30, 1999.
For the first six months of 2000, net income was $325.0 million up 51% from last year's pro-forma total. Revenues for the first six months of 2000 were $1.1 billion, up 32.7% from prior year levels.
"Alliance Capital had yet another outstanding quarter driven by strong revenue growth and margin improvement," Mr. Miller said. "Alliance maintained its number three ranking in non-proprietary net sales in the U.S. as demand for its products remains strong. Alliance continues to invest in new marketing initiatives and to develop products that will continue to provide additional growth."
About AXA Financial
AXA Financial, Inc., with nearly $565 billion in assets under management (giving effect to the pending acquisition of S.C. Bernstein), is one of the world 's premier financial services organizations through its strong brands: The Equitable Life Assurance Society, AXA Advisors, Equitable Distributors, Donaldson, Lufkin & Jenrette (DLJ), DLJdirect, Pershing, iNautix Technologies, Alliance Capital Management and the pending acquisition of Sanford C. Bernstein. AXA Financial is a member of the global AXA Group, which has operations in approximately 60 countries and has more than $900 billion in assets under management. For more information on AXA Financial, visit our Website at http://www.axa-financial.com.
2nd Quarter (PDF Format)
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