Exhibit 99.1
[LETTERHEAD OF W. P. STEWART & CO., LTD.]
PRESS RELEASE
Contact: Fred Ryan
telephone: 441.295.8585
29 March 2007
Hamilton, Bermuda
W. P. Stewart Provides Update
on Business Developments in First Quarter 2007
Board of Directors Changes Dividend Policy
Declares Quarterly Dividend of $0.15 per share payable 28 April 2007
Following a meeting of the Company's Board of Directors, W.P. Stewart & Co.,
Ltd. announced updates to its business activities in the first quarter of 2007
and announced a change in the dividend policy.
First Quarter Update
Performance in the W.P. Stewart & Co., Ltd. U.S. Equity Composite (the
"Composite") is lagging slightly behind the S&P 500 Index for the year to date.
Preliminary indications are that assets under management ("AUM") as of 23 March
2007 were approximately $7.0 billion, compared with approximately $8.1 billion
at 31 December 2006.
"While these remain challenging times for our Company," Bill Stewart, Chairman,
said, "I am confident we are on the right path to restore our company's legacy.
We have initiated a process of renewal as we explore a range of opportunities to
significantly enhance our business for the future benefit of our clients and
shareholders.
"Most importantly," he continued, "we are focusing our analysts and managers on
achieving absolute returns and have reaffirmed our stretch goal of 15 percent
compounded annual returns over a five to ten year horizon. This goal should be
achievable given the quality, growth and the
current low valuation of the companies that make up our investment universe and
in which we invest our clients' accounts. We will also focus on adding more
highly successful investors to our team in the coming year."
The North American investment group has thoroughly reviewed all company coverage
in the U.S. universe, adding two new investment names and removing two from the
universe. In March, the team - now including Bill Stewart, Bob Kahn, a founding
partner and portfolio manager and Mark Phelps, Managing Director - Global
Investments - rebalanced the portfolios, placing more emphasis on the highest
quality companies within the universe. The U.S. equity team will be expanded to
nine senior professionals on 10 April 2007, when a new analyst joins the
Company.
As expected following the management changes announced on 1 February 2007, AUM
for the quarter to date reflects net outflows of approximately $1.1 billion.
Further, there will be additional outflows of at least $325 million in the
current quarter, as one large sub-advised fund notified the Company of its
decision to close their account by 31 March 2007. In commenting on these
developments, Mr. Stewart said; "Virtually all clients have been contacted and
meetings have been held or scheduled with many. While it is too soon to say what
the final flows will look like this year, I am encouraged by the general
response of many of the clients we have met with recently. Our sense is that
many of the balance of our clients, especially those high net worth clients with
whom we have worked for many years, remain committed to sustaining their
relationships with W.P. Stewart."
During the month of February 2007, the Company entered into agreements with
certain employees whose employment with the Company terminated in the first
quarter. In accordance with the terms of these agreements, the Company will
incur one-time, non-recurring cash expenses of approximately $1,600,000 and
non-cash charges related to restricted shares of approximately $4,200,000 in the
first quarter of 2007. Combined, these one-time, non-recurring charges will
equate to approximately $0.11 per share, diluted, on a tax effected basis and
will reduce first quarter earnings accordingly.
Change in Dividend Policy
The Board of Directors has decided to change the way the Company pays its
dividend, moving from the historic pattern of four equal quarterly amounts to a
new policy of paying lower amounts in the first three quarters and a final,
fourth payment in January, based on cash earnings for the year, including any
performance fees received in the fourth quarter.
This new policy allows the Company better to cope with the unpredictability
associated with market appreciation, which is always hard to forecast in the
short term and the related uncertainty about the amount of performance fee
income for the year. As always, the Board will continue to review the dividend
on a quarterly basis and while non-recurring cash charges, extraordinary
transactions and other developments could affect the amount of the dividend
payment in any quarter, the Company's long-standing policy of paying dividends
approximating substantially all its yearly cash earnings remains in effect.
Reflecting the new policy, the Board today declared a regular quarterly dividend
of US$0.15 per common share, payable on 28 April 2007, to shareholders of record
on 14 April 2007.
Mr. Stewart noted the Company continues to develop new growth opportunities.
"Internationally," Mr. Stewart continued, "with a global investment platform in
place, we are developing our global and regional investment services as a
complement to our traditional U. S. equity services, positioning W.P. Stewart
where investment management demand is rising strongly, and which we anticipate
will be a very profitable business over the next several years.
"In summary, we are working hard to reestablish and strengthen relationships
with our exceptional client base and to focus investment management on our
proven investment philosophy. I appreciate the support our clients have shown
the firm and look forward to repaying their loyalty with strong investment
results over the longer-term."
W.P. Stewart is an asset management company that has provided research-
intensive equity management services to clients throughout the world since 1975.
The Company is headquartered in Hamilton, Bermuda and has additional operations
or affiliates in the United States, Europe and Asia.
The Company's shares are listed for trading on the New York Stock Exchange
(NYSE: WPL) and on the Bermuda Stock Exchange (BSX: WPS).
For more information, please visit the Company's website at
http://www.wpstewart.com, or call W.P. Stewart Investor Relations (Fred M. Ryan)
at 1-888-695-4092 (toll-free within the United States) or +441-295-8585 (outside
the United States) or e-mail to IRINFO@wpstewart.com.