Artisan Partners reports ‘muted’ third quarter

Milwaukee-based Artisan Partners Asset Management reported third quarter net income of $63.1 million, or 57 cents per share, up from $56.1 million, or 35 cents per share, in the third quarter of 2013.

Total revenue was $212.4 million, up significantly from $178 million in the same period a year ago.

Assets under management were $106.2 million, up from $96.9 million in the third quarter of 2013. Net client cash outflows totaled $645 million.

“Our business development results in the third quarter were muted compared to recent quarters,” said Eric Colson, president and CEO of Artisan Partners. “Two of our five distribution channels and two of our six investment teams experienced positive client cash flows for the quarter. Our Global Equity team has experienced strong demand in the Global Equity and Non-U.S. Growth strategies, both of which experienced positive net flows. We also continued to see solid flows into our newest strategy, High Income, which has contributed to positive flows in the financial advisor channel. Client outflows in the strategies managed by the U.S. Value team were the primary driver of overall negative net flows for the quarter. Despite weakness in the U.S., flows from our non-U.S. clients were strong, continuing a long-term trend of increasing flows from outside the U.S.

“Financially our primary metrics remain in line with our long-term expectations. Assets declined late in the quarter due to a combination of market depreciation and client outflows. However, three months is a very short period. The leverage of our business model continues to generate an above average operating margin. Cash flow was strong and continues to support an attractive dividend.”

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