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Cohen & Steers, Inc. 280 Park Avenue New York, NY 10017-1216 Tel (212) 832-3232 | | 
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Contact:
Matthew S. Stadler
Executive Vice President
Chief Financial Officer
Cohen & Steers, Inc.
Tel (212) 446-9168
COHEN & STEERS REPORTS FIRST QUARTER
2011 RESULTS
Assets Under Management Reach Record $38.0 Billion
NEW YORK, NY, April 20, 2011—Cohen & Steers, Inc. (NYSE: CNS) reported income attributable to common shareholders of $13.0 million, or $0.30 per share (diluted and basic), for the quarter ended March 31, 2011, compared with income attributable to common shareholders of $8.9 million, or $0.21 per share (diluted and basic), for the quarter ended March 31, 2010. Total revenue for the first quarter of 2011 was $54.8 million, an increase of 32.4% from $41.3 million for the first quarter of 2010.
Assets Under Management
Assets under management were $38.0 billion as of March 31, 2011, an increase of 10.4% from $34.5 billion at December 31, 2010 and an increase of 39.8% from $27.2 billion at March 31, 2010. The increase from December 31, 2010 was due to net inflows of $1.8 billion and market appreciation of $1.7 billion. The increase from March 31, 2010 was due to net inflows of $5.6 billion and market appreciation of $5.3 billion. Average assets under management were $36.1 billion for the quarter ended March 31, 2011, an increase of 10.0% from $32.8 billion for the quarter ended December 31, 2010 and an increase of 44.9% from $24.9 billion for the quarter ended March 31, 2010.
Assets under management for open-end mutual funds were $9.4 billion as of March 31, 2011, an increase of 10.7% from $8.5 billion at December 31, 2010 and an increase of 35.0% from $7.0 billion at March 31, 2010. The increase from December 31, 2010 was due to net inflows of $507 million and market appreciation of $399 million. The increase from March 31, 2010 was due to market appreciation of $1.4 billion and net inflows of $1.0 billion. Average assets under management for open-end mutual funds were $8.8 billion for the quarter ended March 31, 2011, an increase of 10.1% from $8.0 billion for the quarter
ended December 31, 2010 and an increase of 41.3% from $6.2 billion for the quarter ended March 31, 2010.
Assets under management for closed-end mutual funds were $6.7 billion as of March 31, 2011, an increase of 5.6% from $6.4 billion at December 31, 2010 and an increase of 17.0% from $5.7 billion at March 31, 2010. The increase from December 31, 2010 was due to market appreciation of $227 million and inflows of $129 million through use of Cohen & Steers Select Preferred and Income Fund, Inc.’s (“PSF”) credit facility. The increase from March 31, 2010 was due to market appreciation of $583 million and net inflows of $390 million, primarily due to the launch of PSF. Average assets under management for closed-end mutual funds were $6.6 billion for the quarter ended March 31, 2011, an increase of 7.6% from $6.1 billion for the quarter ended December 31, 2010 and an increase of 19.4% from $5.5 billion for the quarter ended March 31, 2010.
Assets under management for institutional separate accounts were $21.9 billion as of March 31, 2011, an increase of 11.8% from $19.6 billion at December 31, 2010 and an increase of 51.2% from $14.5 billion at March 31, 2010. The increase from December 31, 2010 was due to net inflows of $1.2 billion and market appreciation of $1.1 billion. The increase from March 31, 2010 was due to net inflows of $4.1 billion and market appreciation of $3.3 billion. Average assets under management for institutional separate accounts were $20.7 billion for the quarter ended March 31, 2011, an increase of 10.7% from $18.7 billion for the quarter ended December 31, 2010 and an increase of 57.3% from $13.1 billion for the quarter ended March 31, 2010.
Financial Highlights
| | | | | | | | | | | | |
| | | Three Months Ended | |
| | | (in thousands, except per share data or as noted) | |
| | | March 31, | | | December 31, | | | March 31, | |
| | | 2011 | | | 2010 | | | 2010 | |
Revenue | | $ | 54,755 | | | $ | 51,790 | | | $ | 41,344 | |
Expenses | | $ | 35,842 | | | $ | 38,737 | | | $ | 28,915 | |
Operating income | | $ | 18,913 | | | $ | 13,053 | | | $ | 12,429 | |
Operating margin | | | 34.5 | % | | | 25.2 | % | | | 30.1 | % |
Total non-operating income | | $ | 975 | | | $ | 5,134 | | | $ | 1,035 | |
Net income attributable to common shareholders | | $ | 12,975 | | | $ | 12,751 | | | $ | 8,880 | |
Diluted earnings per share attributable to common shareholders | | $ | 0.30 | | | $ | 0.29 | | | $ | 0.21 | |
Assets under management, end of period (in millions) | | $ | 38,030 | | | $ | 34,462 | | | $ | 27,197 | |
Average assets under management for period (in millions) | | $ | 36,087 | | | $ | 32,809 | | | $ | 24,910 | |
Total revenue for the first quarter of 2011 was $54.8 million, an increase of 5.7% from $51.8 million for the fourth quarter of 2010, primarily due to higher average assets under management. Operating expenses for the first quarter of 2011 were $35.8 million, a decrease of 7.5% from $38.7 million for the
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fourth quarter of 2010, primarily due to decreases in distribution and service fees resulting from costs recorded in the fourth quarter of 2010 associated with the launch of PSF. After adjusting for the launch costs of approximately $4.1 million, operating expenses would have been $34.6 million for the three months ended December 31, 2010. Operating income was $18.9 million for the three months ended March 31, 2011, compared with operating income of $13.1 million for the three months ended December 31, 2010. After adjusting for the launch costs mentioned above, operating income would have been $17.2 million for the three months ended December 31, 2010. The company’s operating margin increased to 34.5% for the first quarter of 2011 compared with 25.2% for the three months ended December 31, 2010. After adjusting for the launch costs mentioned above, the company’s operating margin would have been 33.1% for the three months ended December 31, 2010. Non-operating income was $975,000 for the three months ended March 31, 2011, a decrease of 81.0% from $5.1 million for the three months ended December 31, 2010, primarily due to a decrease in equity in earnings from the company’s seed investments and gain from available-for-sale securities investments.
Balance Sheet Information
As of March 31, 2011, cash, cash equivalents and investments were $182 million. As of March 31, 2011, stockholders’ equity was $241 million and the company had no long-term or short-term debt.
Conference Call Information
Cohen & Steers will host a conference call tomorrow, April 21, 2011 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 (800) 769-9015 (U.S.) or (212) 231-2912 (international); passcode: 21520567. 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 1:00 p.m. (ET) on April 21, 2011 and can be accessed at (800) 633-8284 (U.S.) or (402) 977-9140 (international); passcode: 21520567. Internet access to the webcast, which includes audio (listen-only), will be available on the company’s Web site at www.cohenandsteers.com under “Corporate Info.” The webcast will be archived on the Web site for two weeks.
About Cohen & Steers
Cohen & Steers is a manager of equity portfolios specializing in U.S. and international real estate securities, large cap value stocks, listed infrastructure and utilities, and preferred securities. The company also manages alternative investment strategies such as hedged real estate securities portfolios and private real estate multimanager strategies for qualified investors. Headquartered in New York City, with offices in London, Brussels, Hong Kong and Seattle, Cohen & Steers serves individual and institutional investors through a broad range of investment vehicles.
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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, 2010, which is accessible on the Securities and Exchange Commission’s Web site 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.
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Cohen & Steers, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations (Unaudited)
For the Periods Ended
(in thousands, except per share data)
| | | | | | | | | | | | | | | | | | | | |
| | | Three Months Ended | | | % Change From | |
| | | March 31,
2011 | | | December 31,
2010 | | | March 31,
2010 | | | December 31,
2010 | | | March 31,
2010 | |
| | | | | |
Revenue | | | | | | | | | | | | | | | | | | | | |
Investment advisory and administration fees | | $ | 51,052 | | | $ | 48,008 | | | $ | 38,092 | | | | | | | | | |
Distribution and service fees | | | 2,415 | | | | 2,419 | | | | 2,164 | | | | | | | | | |
Portfolio consulting and other | | | 1,288 | | | | 1,363 | | | | 1,088 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Total revenue | | | 54,755 | | | | 51,790 | | | | 41,344 | | | | 5.7 | % | | | 32.4 | % |
| | | | | | | | | | | | | | | | | | | | |
Expenses | | | | | | | | | | | | | | | | | | | | |
Employee compensation and benefits | | | 19,986 | | | | 20,198 | | | | 16,124 | | | | | | | | | |
Distribution and service fees | | | 5,754 | | | | 8,425 | | | | 4,310 | | | | | | | | | |
General and administrative | | | 8,573 | | | | 8,683 | | | | 7,137 | | | | | | | | | |
Depreciation and amortization | | | 1,186 | | | | 1,138 | | | | 1,154 | | | | | | | | | |
Amortization, deferred commissions | | | 343 | | | | 293 | | | | 190 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Total expenses | | | 35,842 | | | | 38,737 | | | | 28,915 | | | | (7.5 | %) | | | 24.0 | % |
| | | | | | | | | | | | | | | | | | | | |
Operating income | | | 18,913 | | | | 13,053 | | | | 12,429 | | | | 44.9 | % | | | 52.2 | % |
| | | | | | | | | | | | | | | | | | | | |
Non-operating income | | | | | | | | | | | | | | | | | | | | |
Interest and dividend income - net | | | 184 | | | | 182 | | | | 195 | | | | | | | | | |
(Loss) gain from trading securities - net | | | (378 | ) | | | — | | | | 189 | | | | | | | | | |
Gain from available-for-sale securities - net | | | 358 | | | | 1,961 | | | | 198 | | | | | | | | | |
Equity in (losses) earnings of affiliates | | | (14 | ) | | | 2,825 | | | | 541 | | | | | | | | | |
Other | | | 825 | | | | 166 | | | | (88 | ) | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Total non-operating income | | | 975 | | | | 5,134 | | | | 1,035 | | | | (81.0 | %) | | | (5.8 | %) |
| | | | | | | | | | | | | | | | | | | | |
Income before provision for income taxes | | | 19,888 | | | | 18,187 | | | | 13,464 | | | | 9.4 | % | | | 47.7 | % |
Provision for income taxes | | | 6,986 | | | | 5,436 | | | | 4,574 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Net income | | | 12,902 | | | | 12,751 | | | | 8,890 | | | | 1.2 | % | | | 45.1 | % |
Less: Net loss (income) attributable to redeemable noncontrolling interest | | | 73 | | | | — | | | | (10 | ) | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Net income attibutable to common shareholders | | $ | 12,975 | | | $ | 12,751 | | | $ | 8,880 | | | | 1.8 | % | | | 46.1 | % |
| | | | | | | | | | | | | | | | | | | | |
| | | | | |
Earnings per share attributable to common shareholders | | | | | | | | | | | | | | | | | | | | |
Basic | | $ | 0.30 | | | $ | 0.30 | | | $ | 0.21 | | | | 1.1 | % | | | 44.6 | % |
| | | | | | | | | | | | | | | | | | | | |
Diluted | | $ | 0.30 | | | $ | 0.29 | | | $ | 0.21 | | | | 1.4 | % | | | 43.3 | % |
| | | | | | | | | | | | | | | | | | | | |
Weighted average shares outstanding | | | | | | | | | | | | | | | | | | | | |
Basic | | | 43,051 | | | | 42,770 | | | | 42,600 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Diluted | | | 43,781 | | | | 43,608 | | | | 42,937 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
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Cohen & Steers, Inc. and Subsidiaries
Assets Under Management (Unaudited)
By Investment Vehicle
For the Periods Ended
(in millions)
| | | | | | | | | | | | | | | | | | | | |
| | | Three Months Ended | | | % Change From | |
| | | March 31,
2011 | | | December 31,
2010 | | | March 31,
2010 | | | December 31,
2010 | | | March 31,
2010 | |
| | | | | |
Open-End Mutual Funds | | | | | | | | | | | | | | | | | | | | |
Assets under management, beginning of period | | $ | 8,484 | | | $ | 7,638 | | | $ | 6,285 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Inflows | | | 1,147 | | | | 880 | | | | 710 | | | | | | | | | |
Outflows | | | (640 | ) | | | (547 | ) | | | (453 | ) | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Net inflows | | | 507 | | | | 333 | | | | 257 | | | | | | | | | |
Market appreciation | | | 399 | | | | 513 | | | | 416 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Total increase | | | 906 | | | | 846 | | | | 673 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Assets under management, end of period | | $ | 9,390 | | | $ | 8,484 | | | $ | 6,958 | | | | 10.7 | % | | | 35.0 | % |
| | | | | | | | | | | | | | | | | | | | |
Average assets under management for period | | $ | 8,803 | | | $ | 7,994 | | | $ | 6,230 | | | | 10.1 | % | | | 41.3 | % |
| | | | | | | | | | | | | | | | | | | | |
| | | | | |
Closed-End Mutual Funds | | | | | | | | | | | | | | | | | | | | |
Assets under management, beginning of period | | $ | 6,353 | | | $ | 5,903 | | | $ | 5,546 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Inflows | | | 129 | | | | 299 | | | | — | | | | | | | | | |
Outflows | | | — | | | | (60 | ) | | | — | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Net inflows | | | 129 | | | | 239 | | | | — | | | | | | | | | |
Market appreciation | | | 227 | | | | 211 | | | | 190 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Total increase | | | 356 | | | | 450 | | | | 190 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Assets under management, end of period | | $ | 6,709 | | | $ | 6,353 | | | $ | 5,736 | | | | 5.6 | % | | | 17.0 | % |
| | | | | | | | | | | | | | | | | | | | |
Average assets under management for period | | $ | 6,613 | | | $ | 6,144 | | | $ | 5,537 | | | | 7.6 | % | | | 19.4 | % |
| | | | | | | | | | | | | | | | | | | | |
| | | | | |
Institutional Separate Accounts | | | | | | | | | | | | | | | | | | | | |
Assets under management, beginning of period | | $ | 19,625 | | | $ | 17,698 | | | $ | 12,954 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Inflows | | | 1,529 | | | | 1,411 | | | | 1,394 | | | | | | | | | |
Outflows | | | (321 | ) | | | (592 | ) | | | (520 | ) | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Net inflows | | | 1,208 | | | | 819 | | | | 874 | | | | | | | | | |
Market appreciation | | | 1,098 | | | | 1,108 | | | | 675 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Total increase | | | 2,306 | | | | 1,927 | | | | 1,549 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Assets under management, end of period1 | | $ | 21,931 | | | $ | 19,625 | | | $ | 14,503 | | | | 11.8 | % | | | 51.2 | % |
| | | | | | | | | | | | | | | | | | | | |
Average assets under management for period | | $ | 20,671 | | | $ | 18,671 | | | $ | 13,143 | | | | 10.7 | % | | | 57.3 | % |
| | | | | | | | | | | | | | | | | | | | |
| | | | | |
Total | | | | | | | | | | | | | | | | | | | | |
Assets under management, beginning of period | | $ | 34,462 | | | $ | 31,239 | | | $ | 24,785 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Inflows | | | 2,805 | | | | 2,590 | | | | 2,104 | | | | | | | | | |
Outflows | | | (961 | ) | | | (1,199 | ) | | | (973 | ) | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Net inflows | | | 1,844 | | | | 1,391 | | | | 1,131 | | | | | | | | | |
Market appreciation | | | 1,724 | | | | 1,832 | | | | 1,281 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Total increase | | | 3,568 | | | | 3,223 | | | | 2,412 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Assets under management, end of period | | $ | 38,030 | | | $ | 34,462 | | | $ | 27,197 | | | | 10.4 | % | | | 39.8 | % |
| | | | | | | | | | | | | | | | | | | | |
Average assets under management for period | | $ | 36,087 | | | $ | 32,809 | | | $ | 24,910 | | | | 10.0 | % | | | 44.9 | % |
| | | | | | | | | | | | | | | | | | | | |
| 1 | As of March 31, 2011, December 31, 2010 and March 31, 2010, assets under management in institutional separate accounts included $146 million, $152 million and $220 million, respectively, of assets invested in the company’s alternative strategy. |
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Cohen & Steers, Inc. and Subsidiaries
Assets Under Management (Unaudited)
By Investment Strategy
(in millions)
| | | | | | | | | | | | |
| | | As of March 31,
2011 | | | As of December 31,
2010 | | | As of March 31,
2010 | |
| | | |
Open-End Mutual Funds | | | | | | | | | | | | |
Global / International Real Estate | | $ | 3,110 | | | $ | 2,917 | | | $ | 2,418 | |
U.S. Real Estate | | | 5,761 | | | | 5,095 | | | | 4,212 | |
Large Cap Value | | | 167 | | | | 200 | | | | 214 | |
Global Infrastructure | | | 105 | | | | 108 | | | | 114 | |
Preferreds | | | 247 | | | | 164 | | | | — | |
| | | | | | | | | | | | |
Assets under management, end of period | | $ | 9,390 | | | $ | 8,484 | | | $ | 6,958 | |
| | | | | | | | | | | | |
| | | |
Closed-End Mutual Funds | | | | | | | | | | | | |
U.S. Real Estate | | $ | 2,275 | | | $ | 2,180 | | | $ | 1,984 | |
Large Cap Value | | | 396 | | | | 388 | | | | 379 | |
Global Infrastructure | | | 2,499 | | | | 2,426 | | | | 2,348 | |
Preferreds | | | 991 | | | | 828 | | | | 509 | |
Other | | | 548 | | | | 531 | | | | 516 | |
| | | | | | | | | | | | |
Assets under management, end of period | | $ | 6,709 | | | $ | 6,353 | | | $ | 5,736 | |
| | | | | | | | | | | | |
| | | |
Institutional Separate Accounts | | | | | | | | | | | | |
Global / International Real Estate1 | | $ | 13,773 | | | $ | 12,677 | | | $ | 8,927 | |
U.S. Real Estate | | | 3,993 | | | | 3,227 | | | | 2,655 | |
Large Cap Value | | | 3,335 | | | | 3,085 | | | | 2,502 | |
Global Infrastructure | | | 521 | | | | 335 | | | | 134 | |
Preferreds | | | 309 | | | | 301 | | | | 285 | |
| | | | | | | | | | | | |
Assets under management, end of period | | $ | 21,931 | | | $ | 19,625 | | | $ | 14,503 | |
| | | | | | | | | | | | |
| | | |
Total | | | | | | | | | | | | |
Global / International Real Estate | | $ | 16,883 | | | $ | 15,594 | | | $ | 11,345 | |
U.S. Real Estate | | | 12,029 | | | | 10,502 | | | | 8,851 | |
Large Cap Value | | | 3,898 | | | | 3,673 | | | | 3,095 | |
Global Infrastructure | | | 3,125 | | | | 2,869 | | | | 2,596 | |
Preferreds | | | 1,547 | | | | 1,293 | | | | 794 | |
Other | | | 548 | | | | 531 | | | | 516 | |
| | | | | | | | | | | | |
Assets under management, end of period | | $ | 38,030 | | | $ | 34,462 | | | $ | 27,197 | |
| | | | | | | | | | | | |
| 1 | As of March 31, 2011, December 31, 2010 and March 31, 2010, assets under management in the company’s Global / International Real Estate strategy in institutional separate accounts included $146 million, $152 million and $220 million, respectively, of assets invested in the company’s alternative strategy. |
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Cohen & Steers, Inc. and Subsidiaries
Other Fee Earning Assets (Unaudited)
(in millions)
| | | | | | | | | | | | |
| | | As of March 31,
2011 | | | As of December 31,
2010 | | | As of March 31,
2010 | |
Unified Managed Accounts, end of period | | $ | 554 | | | $ | 555 | | | $ | 492 | |
| | | | | | | | | | | | |
| | | |
| | | | | | | | | | | | |
| | | | | | | | | | | | |
Exchange Traded Funds, end of period | | $ | 2,558 | | | $ | 2,284 | | | $ | 2,028 | |
| | | | | | | | | | | | |
| | | |
| | | | | | | | | | | | |
| | | | | | | | | | | | |
Unit Investment Trusts, end of period | | $ | 1,421 | | | $ | 1,428 | | | $ | 1,330 | |
| | | | | | | | | | | | |
| | | |
| | | | | | | | | | | | |
| | | | | | | | | | | | |
Total, end of period | | $ | 4,533 | | | $ | 4,267 | | | $ | 3,850 | |
| | | | | | | | | | | | |
Note: Other fee earning assets are defined as assets for which the company provides investment advice but for which the company has no discretion to execute trades, and therefore are not included in the company’s reported assets under management.
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