Janus profit plummets 93% in first quarter

Janus Capital Group Inc. today reported a first-quarter net income of $2.7 million, or $0.02 per share, representing a 65% decline from $7.8 million in income for the fourth quarter of 2008.

Last year at this time, the Denver-based fund firm’s net income was $39 million.

Janus also reported $170.3 million in revenue for the quarter, down from $177.1 million in the fourth quarter of 2008.

The firm had $110.9 billion in assets under management as of March 31, down from $123.5 billion as of Dec. 31.

The decline in assets reflected $900 million in net outflows from its funds in the first quarter, $6.4 billion in market depreciation and money market net outflows of $5.3 billion, the firm reported.

Part of the asset decline was due to the firm’s decision to exit the institutional money market mutual fund business, said Gary Black, chief executive, in an earnings conference call.

While the firm experienced $900 million in net outflows from its funds in the first quarter, that was less than the $3 billion in net outflows it posted in the fourth quarter.

Market stabilization was a factor in the first quarter, as well as improved fund performance, Mr. Black said.

“We’ve seen a sharp improvement in flows since the market bottomed out,” he said. “We built out distribution in the right spots and are focused on advisers. But in this business, flows always find the performance.”

Mr. Black also said that the firm has been gaining market share in the advisory and international segment.

Janus announced plans last month to merge its fund lineup to focus more on distributing through advisers.

Eighty-five percent of the flows currently come through the advisory channel, Mr. Black said.