NEW YORK, April 23 /PRNewswire-FirstCall/ -- Cohen & Steers, Inc. (NYSE: CNS) reported net income of $13.0 million, or $0.31 per share (diluted and basic), for the quarter ended March 31, 2008, compared with net income of $22.3 million, or $0.52 per diluted share and $0.53 per basic share, for the quarter ended March 31, 2007. Total revenue for the first quarter of 2008 was $53.6 million, a decrease of 30.1% from $76.8 million in the first quarter of 2007. The decline in revenue and net income was primarily attributable to lower investment banking fees and lower average assets under management.
Assets Under Management
Assets under management were $28.6 billion at March 31, 2008, a decrease of 4.1% from $29.8 billion at December 31, 2007 and a decrease of 14.8% from $33.6 billion at March 31, 2007. The decrease from December 31, 2007 was due to net outflows of $526 million and market depreciation of $690 million.
At March 31, 2008, U.S. REIT common stocks comprised 46% of total assets, compared with 53% at March 31, 2007. Non-U.S. investors held approximately 21% of the assets managed by the company at March 31, 2008, compared with 16% at March 31, 2007.
Recent Developments
"We have made substantial progress toward achieving our goal of offering alternative investment products," said Martin Cohen, co-chairman and co-chief executive officer of Cohen & Steers. The move into alternatives included the addition of the following key personnel:
-- Todd Voigt as portfolio manager for the company's hedged real estate
securities portfolios, including its long-short global real estate
securities strategy. The company's first long-short global real estate
securities fund was launched on March 31, 2008.
-- A team, led by Stephen Coyle, to manage the company's private global
real estate fund of funds, which will invest in commercial real estate
through institutional, value added and opportunistic private real
estate funds. The team's objective will be to deliver customized
solutions to the growing global multi-manager marketplace.
-- Christopher Henderson as head of marketing for alternative investment
products.
Other recent developments included:
-- Cohen & Steers Realty Shares, Inc. received a Lipper Performance
Achievement Certificate for being ranked first out of six funds in the
Lipper Real Estate Funds category for the 15 year period ending
December 31, 2007.
-- Working with ALPS Distributors, Inc. to launch Cohen & Steers Global
Realty Majors ETF, an exchange-traded fund currently in registration
with the Securities and Exchange Commission.
-- Expanding the investment mandate for Cohen & Steers Utility Fund, Inc.
to include global listed infrastructure securities, and changing its
name to Cohen & Steers Global Infrastructure Fund, Inc.
-- Evaluating a range of alternatives to potentially diversify and lower
the cost of capital for the company's closed-end funds that utilize
leverage.
Asset Management Segment
Total revenue for the asset management segment was $53.6 million for the three months ended March 31, 2008, a decrease of 12.2% from $61.0 million for the first quarter of 2007. Pretax income was $22.1 million for the three months ended March 31, 2008, a decrease of 17.5% from $26.8 million for the first quarter of 2007.
Assets under management were $28.6 billion at March 31, 2008, a decrease of 14.8% from $33.6 billion at March 31, 2007. The decrease was a result of market depreciation of $7.0 billion partially offset by net inflows of $2.0 billion.
The company recorded net outflows of $243 million from open-end mutual funds during the quarter ended March 31, 2008. Outflows of $1.1 billion were partially offset by inflows of $888 million.
Institutional separate accounts had net outflows of $283 million during the quarter ended March 31, 2008. Outflows of $600 million were partially offset by inflows of $317 million.
Investment Banking Segment
Total revenue for the investment banking segment was $51,000 for the quarter ended March 31, 2008, compared with $15.7 million for the quarter ended March 31, 2007. Pretax loss was $1.5 million for the three months ended March 31, 2008, compared with pretax income of $9.2 million for the first quarter of 2007. Revenue from investment banking activity is dependent on the completion of transactions, the timing of which cannot be predicted.
Balance Sheet Information
As of March 31, 2008, cash, cash equivalents and marketable securities available for sale were $180 million. As of March 31, 2008, stockholders' equity was $272 million and the company had no long-term or short-term debt.
Conference Call Information
Cohen & Steers will hold a conference call tomorrow, April 24, 2008 at 11:00 a.m. (ET) to discuss the Company's first quarter results. Investors and analysts can access the live conference call by dialing (866) 672-2663 (U.S.) and (973) 582-2772 (international); passcode: 43730119. Participants should plan to register at least 10 minutes before the conference call begins.
A replay of the call will be available for two weeks starting at approximately 2:00 p.m. (ET) on April 24, 2008 and can be accessed at (800) 642-1687 (U.S.) and (706) 645-9291 (international); passcode: 43730119. Internet access to the Web cast, which includes audio (listen-only), will be available on the Company's Web site at www.cohenandsteers.com under "Corporate Info." The Web cast will be archived on the Web site for two weeks.
About Cohen & Steers, Inc.
Cohen & Steers is a manager of high-income equity portfolios, specializing in U.S. and international real estate securities, preferred securities, utilities and listed infrastructure securities, and large cap value stocks. Headquartered in New York City with offices in Brussels, Hong Kong, London and Seattle, the company serves individual and institutional investors through open-end mutual funds, closed-end mutual funds and institutional separate accounts.
Forward-Looking Statements
This press release and other statements that Cohen & Steers may make may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, which reflect the company's current views with respect to, among other things, its operations and financial performance. You can identify these forward- looking statements by the use of words such as "outlook," "believes," "expects," "potential," "continues," "may," "will," "should," "seeks," "approximately," "predicts," "intends," "plans," "estimates," "anticipates" or the negative versions of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties.
Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. The company believes that these factors include, but are not limited to, those described in the "Risk Factors" section of the company's Annual Report on Form 10-K for the year ended December 31, 2007, which is accessible on the Securities and Exchange Commission's website at www.sec.gov and on the company's Web site at www.cohenandsteers.com. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this release. The company undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.
Performance Notes
Cohen & Steers Realty Shares, Inc. Lipper, an expert in fund research and evaluation, rates funds against their peers according to performance measures. Lipper's Performance Achievement Certificates are awarded to funds with returns that rank first in their Lipper category over one or more time periods: one, five, 10 or 15-year (depending on universe). Certificates are awarded for all Lipper Classifications and for the overall fund universe. Open-end funds, closed-end funds and variable underlying products are considered for awards. Awards are based upon cumulative total return.
For periods ended December 31, 2007, Lipper ranked the fund as follows within the Real Estate Funds category: 263 out of 309 funds for the one-year period; 31 out of 158 funds for the five-year period; 19 out of 64 funds for the ten-year period; and 1 out of 6 funds for the fifteen-year period.
Investors are cautioned that some peer groups are inherently more volatile than others, and even top rated Lipper funds in the most volatile groups may not be well suited to shorter-term goals or less risk-tolerant investors.
Because the fund concentrates its investments in real estate securities, there are special risks associated with investing in the fund. These include falling property values due to increasing vacancies or declining rents resulting from economic, legal, or technological developments. As a non-diversified fund, the fund may be subject to greater risk of loss than a more diversified portfolio. The fund's expense ratio is currently 0.96%.
Average annual returns as of 12/31/07
Cohen & Steers NAREIT Equity
Period Realty Shares REIT Index S&P 500 Index
1 Year -18.77 % -17.37 % -5.08 %
5 Years 20.00 % 18.33 % 11.32 %
10 Years 11.38 % 10.69 % 3.51 %
15 Years 12.38 % 11.66 % 9.46 %
Since Inception (7/21/91) 14.05 % 13.29 % 9.99 %
Performance data quoted represent past performance, which is no guarantee of future results. The investment return and principal value of an investment will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. Total returns for the fund, current to the most recent month-end, can be obtained by visiting www.cohenandsteers.com. The performance data quoted include change in net asset value and reinvestment of dividends and capital gains.
The fund seeks maximum total return through both current income and capital appreciation by investing in real estate securities, primarily real estate investment trusts, which are commonly referred to as REITs. Additional information about the fund, or any of the company's open or closed-end funds, can be found at the company's Web site, www.cohenandsteers.com.
Cohen & Steers Global Realty Majors ETF. A registration statement (prospectus) for this fund has been filed with the SEC. These securities may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective. Information contained therein regarding the fund is subject to completion or amendment. This information shall not constitute an offer to buy nor shall there be any sale of these securities in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state. Please consider the investment objectives, risks, charges and expenses of the fund carefully before investing. This information, as well as other information about the fund, is described in the prospectus. Please call (866) 513-5856 for a prospectus, which should be read carefully before investing. Cohen & Steers Global Realty Majors ETF is distributed by ALPS Distributors, Inc.
Cohen & Steers Global Infrastructure Fund, Inc. Please consider the investment objectives, risks, charges and expenses of a fund carefully before investing. This and other information about the fund is included in the prospectus. Please read the prospectus carefully before investing. Call 1-800-330-7848 or visit cohenandsteers.com for a prospectus. Cohen & Steers Securities, LLC is the distributor of the Cohen & Steers open-end mutual funds.
Cohen & Steers, Inc. and Subsidiaries
Condensed Consolidated Statements of Income (Unaudited)
For the Periods Ended
(in thousands, except per share data)
Three Months Ended % Change From
March December March December March
31, 2008 31, 2007 31, 2007 31, 2007 31, 2007
Revenue
Investment advisory
and administration
fees $46,643 $54,115 $52,156
Distribution and
service fees 5,374 6,941 6,380
Portfolio consulting
and other 1,570 2,004 2,485
Investment banking fees 51 3,827 15,746
Total revenue 53,638 66,887 76,767 (19.8%) (30.1%)
Expenses
Employee compensation
and benefits 17,432 17,647 22,262
Distribution and
service fees 6,622 7,566 9,267
General and
administrative 8,031 9,770 7,271
Depreciation and
amortization 1,106 1,821 1,671
Amortization, deferred
commissions 1,996 2,781 2,070
Total expenses 35,187 39,585 42,541 (11.1%) (17.3%)
Operating income 18,451 27,302 34,226 (32.4%) (46.1%)
Non-operating income
Interest and dividend
income 1,787 2,666 1,657
Gain from sale of
marketable securities 56 100 195
Foreign currency
transaction
gain (loss) 355 88 (76)
Total non-operating
income 2,198 2,854 1,776 (23.0%) 23.8%
Income before provision
for income taxes 20,649 30,156 36,002 (31.5%) (42.6%)
Provision for income
taxes 7,649 11,459 13,686
Net income $13,000 $18,697 $22,316 (30.5%) (41.7%)
Earnings per share
Basic $0.31 $0.45 $0.53 (30.5%) (41.6%)
Diluted $0.31 $0.44 $0.52 (29.8%) (40.8%)
Weighted average shares
outstanding
Basic 41,903 41,864 41,983
Diluted 42,134 42,566 42,828
Cohen & Steers, Inc. and Subsidiaries
Selected Segment Financial Data (Unaudited)
For the Periods Ended
(in thousands)
Three Months Ended % Change From
March December March December March
31, 2008 31, 2007 31, 2007 31, 2007 31, 2007
Asset Management
Total revenue $53,587 $63,060 $61,021 (15.0%) (12.2%)
Total expenses (33,450) (36,188) (35,674) (7.6%) (6.2%)
Net non-operating
income 2,009 2,438 1,489 (17.6%) 34.9%
Income before provision
for income taxes $22,146 $29,310 $26,836 (24.4%) (17.5%)
Investment Banking
Total revenue $51 $3,827 $15,746 (98.7%) (99.7%)
Total expenses (1,737) (3,397) (6,867) (48.9%) (74.7%)
Net non-operating income 189 416 287 (54.6%) (34.1%)
(Loss) income before
provision for
income taxes $(1,497) $846 $9,166 * *
Total
Total revenue $53,638 $66,887 $76,767 (19.8%) (30.1%)
Total expenses (35,187) (39,585) (42,541) (11.1%) (17.3%)
Net non-operating income 2,198 2,854 1,776 (23.0%) 23.8%
Income before provision
for income taxes $20,649 $30,156 $36,002 (31.5%) (42.6%)
* Not meaningful
Cohen & Steers, Inc. and Subsidiaries
Assets Under Management (Unaudited)
For the Periods Ended
(in millions)
Three Months Ended % Change From
March December March December March
31, 2008 31, 2007 31, 2007 31, 2007 31, 2007
Closed-End Mutual Funds
Assets under management,
beginning of period $10,274 $11,371 $11,391
Inflows - 89 202
Market (depreciation)
appreciation (550) (1,186) 149
Total (decrease)
increase (550) (1,097) 351
Assets under management,
end of period $9,724 $10,274 $11,742 (5.4%) (17.2%)
Open-End Mutual Funds
Assets under management,
beginning of period $8,900 $10,842 $9,575
Inflows 888 919 2,366
Outflows (1,131) (1,370) (792)
Net (outflows) inflows (243) (451) 1,574
Market (depreciation)
appreciation (225) (1,491) 331
Total (decrease)
increase (468) (1,942) 1,905
Assets under management,
end of period $8,432 $8,900 $11,480 (5.3%) (26.6%)
Institutional Separate
Accounts
Assets under management,
beginning of period $10,612 $12,510 $8,930
Inflows 317 384 1,658
Outflows (600) (732) (559)
Net (outflows) inflows (283) (348) 1,099
Market appreciation
(depreciation) 85 (1,550) 301
Total (decrease)
increase (198) (1,898) 1,400
Assets under management,
end of period $10,414 $10,612 $10,330 (1.9%) 0.8%
Total
Assets under management,
beginning of period $29,786 $34,723 $29,896
Inflows 1,205 1,392 4,226
Outflows (1,731) (2,102) (1,351)
Net (outflows) inflows (526) (710) 2,875
Market (depreciation)
appreciation (690) (4,227) 781
Total (decrease)
increase (1,216) (4,937) 3,656
Assets under management,
end of period $28,570 $29,786 $33,552 (4.1%) (14.8%)
SOURCE Cohen & Steers, Inc.
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