Morningstar 4Q earnings slip 3.5%

Morningstar Inc. yesterday reported a 3.5% decline in fourth-quarter earnings and the launch of a series of cost-cutting measures. The Chicago-based fund tracker reported net income of $19.3 million for the fourth quarter, down from $20 million a year earlier. “About 13% of our revenue is tied to asset-based fees, so the severe market downturn had a negative impact,” Joe Mansueto, Morningstar’s chairman and chief executive, said in a statement. Morningstar began making cutbacks effective Jan. 1, including reducing bonuses and cutting back on travel. The company also suspended matching contributions to its 401(k) program as well as salary increases and has postponed most new hiring, according to the statement. For the full year, net income was $92.5 million, up from $73.9 million in 2007. That included $27.1 million from acquisitions, the firm reported. The acquisitions included six financial-data and research services, four of which are located outside the United States. Morningstar’s work force grew to 2,375, from 1,720 a year earlier, and included 340 employees as a result of the acquisitions.