Merrill's profits surge 31% in first quarter

Merrill Lynch & Co. Inc.'s first-quarter profits increased 31% from a year ago, when it took a charge related to its acquisition of BlackRock Inc. the company reported today. Excluding the BlackRock buy, the New York-based financial services firm attributed the rise in profits to high trading volumes. The New York-based financial services company posted first-quarter income of $2.11 billion, or $2.26 per share, up from $432 million, or 44 cents per share during the year-ago period. Merrill recorded a $1.2 billion one-time compensation expense related to the BlackRock acquisition during the first quarter of 2006. Revenues increased 24% to $9.85 billion, compared to $7.97 billion during the year-ago period. Analysts surveyed by Thomson Financial had forecasted profit of $1.97 on revenue of $9.06 billion. The Global Wealth management business produced a 16% increase in revenue to $3.4 billion, from $2.93 billion in the year ago period, resulting from a 31% increase in pretax earnings to $842 million on higher profit margins. Revenues from its Global Markets and investment banking grew increased 43% to a record $6.5 billion, compared to $4.6 billion during the first quarter of 2006, as international operations grew "significantly faster" than that in the U.S., according to Merrill. "In an environment which was volatile at times, we took full advantage of market opportunities and delivered value to our clients and our shareholders," said Stan O'Neal, chairman and chief executive, in a statement.