T. Rowe, Waddell, Countrywide & more

T. Rowe Price earnings grew 28% in the fourth quarter on increased investment advisory fees and net inflows.
JAN 29, 2008
Earnings at T. Rowe Price Group Inc., optionsXpress Holdings Inc. and Waddell & Reed Financial Inc. grew in the fourth quarter, while Countrywide Financial Corp. and Unum Group saw earnings turn south. T. Rowe Price earnings increased 28% on larger investment advisory fees and net inflows. The Baltimore-based money manager said net income increased to $190.7 million, or 68 cents a share, from $148.9 million, or 53 cents a share, in the year-ago period. The company said investment advisory fees increased 24% to $506.6 million, assets under management grew 20% to $4 billion and net inflows from investors totaled $33.8 billion. optionsXpress Holdings Inc. said quarterly profit rose 44% as increased volatility in the stock market lifted trading activity. The Chicago-based online brokerage said net income for the quarter was $28 million, or 44 cents per share, compared with $19.4 million, or 31 cents per share during the year-ago period. During the quarter, optionsXpress' daily average revenue trades, or DARTs, rose 54% to 41,500. The company also added 14,600 new accounts in the quarter. Waddell & Reed Financial Inc.’s net income grew nearly 17% on stronger adviser productivity and improved variable annuity sales. The Overland Park, Kan.-based money manager said net income was $35.1 million, or $0.42 per share, compared to net income of $30 million, or 36 cents per share during the year-ago quarter. Adviser productivity increased 13% to $334,000 per adviser. Countrywide Financial posted a fourth-quarter loss due to rising loss provisions and impairment charges as more borrowers fell behind on their mortgage payments. The troubled Calbasas, Calif.-based mortgage lender said it lost $422 million, or 79 cents per share during the quarter, compared with earnings of $622 million, or $1.01 per share, during the year-ago period. Countrywide put aside $924 million for credit losses during the quarter, compared with reserves of $73 million during the fourth quarter of 2006. The lender also posted an impairment charge of $831 million tied to securities backed by home equity lines of credit and a $394 million loss as it transferred loans to a held-for-investment portfolio. Earlier this month, Countrywide agreed to be acquired by Charlotte, N.C.-based Bank of America Corp. for $4 billion in stock. Unum Group reported that net income fell 42% as a result of an investment loss and the cost of retiring debt. The Chattanooga, Tenn.-based disability insurer said net income totaled $160.5 million, or 44 cents per share, down 42% from the year-ago period when the company posted earnings of $276.1 million, or 80 cents per share. Unum's U.S. business reported operating income of $41.3 million in the quarter, up 18% from operating income of $35.1 million in the fourth quarter of 2006. Earnings from continuing operations increased 19% to $213.1 million, or 59 cents per share. Jackson National Life Insurance Co. generated more than $14.5 billion in sales and deposits in 2007, a 22% increase from the year-ago period. The Lansing, Mich.-based company said variable annuity sales increased 29% to $9.1 billion, Separately Managed Account sales grew 57% to $1.3 billion and sales of retail products increased 24% to $12.6 billion.

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