NEW YORK, April 28, 2016 /PRNewswire/
-- AllianceBernstein L.P. ("AB") and AllianceBernstein Holding
L.P. ("AB Holding") (NYSE: AB) today reported financial and
operating results for the quarter ended March 31, 2016.
"After a challenging first two months of the year, both global
markets and investor sentiment lifted in March," said Peter S. Kraus, Chairman and Chief Executive
Officer. "While gross sales for the first quarter lagged the levels
of a year ago, we experienced strong momentum in diverse areas like
global high income, US investment grade and municipal bonds, and
strategic core equities. At the same time, with redemptions still
at or near multi-year lows, we had net inflows of $2.2 billion."
(US $ Thousands
except per Unit amounts)
|
1Q
2016
|
|
1Q
2015
|
|
1Q 2016 vs
1Q 2015 %
Change
|
|
4Q
2015
|
|
1Q 2016 vs
4Q 2015 %
Change
|
|
|
|
|
|
|
|
|
|
|
Adjusted Financial
Measures (1)
|
|
|
|
|
|
|
|
|
|
Net
revenues
|
$
|
590,066
|
|
|
$
|
633,995
|
|
|
(6.9)%
|
|
606,371
|
|
|
(2.7%)
|
Operating
income
|
$
|
132,066
|
|
|
$
|
151,613
|
|
|
(12.9)%
|
|
161,746
|
|
|
(18.3%)
|
Operating
margin
|
22.4
|
%
|
|
23.9
|
%
|
|
|
|
26.7
|
%
|
|
|
AB Holding Diluted
EPU
|
$
|
0.40
|
|
|
$
|
0.45
|
|
|
(11.1)%
|
|
$
|
0.50
|
|
|
(20.0%)
|
AB Holding cash
distribution per Unit
|
$
|
0.40
|
|
|
$
|
0.45
|
|
|
(11.1)%
|
|
$
|
0.50
|
|
|
(20.0%)
|
|
|
|
|
|
|
|
|
|
|
U.S. GAAP Financial
Measures
|
|
|
|
|
|
|
|
|
|
Net
revenues
|
$
|
769,126
|
|
|
$
|
762,571
|
|
|
0.9%
|
|
726,726
|
|
|
5.8%
|
Operating
income
|
$
|
173,042
|
|
|
$
|
153,214
|
|
|
12.9%
|
|
170,913
|
|
|
1.2%
|
Operating
margin
|
23.2
|
%
|
|
19.9
|
%
|
|
|
|
23.3
|
%
|
|
|
AB Holding Diluted
EPU
|
$
|
0.56
|
|
|
$
|
0.45
|
|
|
24.4%
|
|
$
|
0.53
|
|
|
5.7%
|
|
|
|
|
|
|
|
|
|
|
(US $
Billions)
|
|
|
|
|
|
|
|
|
|
Assets Under
Management
|
|
|
|
|
|
|
|
|
|
Ending AUM
|
479.0
|
|
|
485.9
|
|
|
(1.4%)
|
|
467.4
|
|
|
2.5%
|
Average
AUM
|
465.4
|
|
|
481.0
|
|
|
(3.2%)
|
|
470.9
|
|
|
(1.2%)
|
|
|
|
|
|
|
|
|
|
|
(1) The adjusted
financial measures are all non-GAAP financial measures. See pages
12-14 for reconciliations of GAAP Financial Results to Adjusted
Financial Results and page 15 for notes describing the
adjustments.
|
Kraus continued: "We've worked hard in the years since the
Global Financial Crisis to build out and innovate in the regions,
channels and services where we see the best growth prospects for
our clients, and consistently improve upon AB's competitive
positioning and financial strength. Today, we're seeing our efforts
pay off in the improvement of our investment portfolios, the
diversity of our offering, and the strength of our client
relationships and financials. Navigating the volatility of the
first quarter was challenging, but we maintained our long-term
track records in both fixed income and equities. In fixed income,
84% of our assets were in outperforming services for the 3-year
period through March, and in equities, we were at 82%. In addition,
we were just named Small Cap Value Manager of the Year by
Institutional Investor. Even in the toughest markets, we're being
recognized for the performance and innovation of our products.
Multi-asset is a good example. During the quarter, a major national
consultant awarded our new retail multi-manager target-date fund
and Collective Investment Trust (CIT) series with a buy rating. On
the retail target-date fund side, our 11 fund vintages ranked 30th
percentile on average for the quarter and 19th percentile for the
1-year, in each case beating the top three target-date providers in
the category. Overseas, we were named the #1 Discretionary
Investment Manager (DIM) in the multi-asset space in Taiwan and our Emerging Markets Multi-Asset
(EMMA) Luxembourg-based fund was
upgraded to five stars for the 3-year period. We're also gaining
momentum in the private credit space. Our second Commercial Real
Estate Debt fund just closed at $1.5
billion, exceeding our target by 50%. And our Private Wealth
clients committed $200 million to our
new energy fund, a solid raise given the volatility of oil prices
during the quarter. The success of this and other targeted services
is helping us to broaden and expand our client base. Finally, on
the sell-side, by staying true to our differentiated research model
and unconflicted trading platform, we continue to rank highly on
annual independent industry surveys and to outpace peers in revenue
growth."
Kraus concluded: "Across our businesses, we remain committed to
investing for growth while keeping costs in check, and we delivered
on this commitment in the first quarter of 2016, reducing our total
adjusted operating expenses by 5% year-on-year. We remain
relentless in pursuing our goal of expanding margins when revenue
growth accelerates. In the meantime, we'll keep pushing forward on
our mission to keep clients Ahead of Tomorrow with our products and
our service."
The firm's cash distribution per unit of $0.40 is payable on May
19, 2016, to holders of record of AB Holding Units at the
close of business on May 9, 2016.
Market Performance
US and global equity markets were mixed in the first quarter,
while US and global fixed income markets were higher. The S&P
500's total return was 1.4% in the first quarter, while the MSCI
EAFE Index's total return was (2.9)%. The Barclays US Aggregate
Index returned 3.0% during the first quarter and the Barclays
Global Aggregate ex US Index's total return was 8.3%.
Assets Under Management ($ Billions)
Total assets under management as of March
31, 2016 were $479.0 billion,
up $11.6 billion, or 2.5%, from
December 31, 2015, and down
$6.9 billion, or 1.4%, from
March 31, 2015.
|
Institutions
|
|
Retail
|
|
Private Wealth
Management
|
|
Total
|
Assets Under
Management 3/31/16
|
$244.8
|
|
$155.9
|
|
$78.3
|
|
$479.0
|
Net Flows for Three
Months Ended 3/31/16
|
$1.8
|
|
$(0.6)
|
|
$1.0
|
|
$2.2
|
Total net inflows were $2.2
billion, compared to the prior quarter's net outflows of
$2.5 billion and the prior-year
period's net inflows of $6.0
billion.
Net inflows to the Institutions channel were $1.8 billion, compared to net outflows of
$0.9 billion in the fourth quarter of
2015. Institutions gross sales of $4.5
billion increased 5% from $4.3
billion in the prior quarter. The pipeline of awarded but
unfunded Institutional mandates increased sequentially from
$6.1 billion to $6.2 billion as of March
31, 2016.
The Retail channel experienced first quarter 2016 net outflows
of $0.6 billion, compared to
$1.5 billion of net outflows in the
prior quarter. Retail gross sales of $7.7
billion decreased 5% from the fourth quarter's $8.1 billion.
In the Private Wealth channel, net inflows of $1.0 billion compared to net outflows of
$0.1 billion in the prior quarter.
Private Wealth gross sales increased 52% to $3.2 billion from the prior quarter's
$2.1 billion.
First Quarter Financial Results
We are presenting both earnings information derived in
accordance with accounting principles generally accepted in
the United States of America ("US
GAAP") and non-GAAP, adjusted earnings information in this release.
Management principally uses these non-GAAP financial measures in
evaluating performance because they present a clearer picture of
our operating performance, and allow management to see long-term
trends without the distortion caused by long-term incentive
compensation-related mark-to-market adjustments, real estate
consolidation charges/credits and other adjustment items.
Similarly, we believe that this non-GAAP earnings information helps
investors better understand the underlying trends in our results
and, accordingly, provides a valuable perspective for investors. AB
Holding is required to distribute all of its Available Cash Flow,
as defined in the AB Holding Partnership Agreement, to its
Unitholders (including the General Partner). Since the third
quarter of 2012, Available Cash Flow has been the adjusted diluted
net income per unit for the quarter multiplied by the number of
units outstanding at the end of the quarter. Management anticipates
that Available Cash Flow will continue to be based on adjusted
diluted net income per unit, unless management determines that one
or more of the non-GAAP adjustments that are made for adjusted net
income should not be made with respect to the Available Cash Flow
calculation. These non-GAAP measures are provided in addition to,
and not as substitutes for, any measures derived in accordance with
US GAAP and they may not be comparable to non-GAAP measures
presented by other companies. Management uses both US GAAP and
non-GAAP measures in evaluating our financial performance. The
non-GAAP measures alone may pose limitations because they do not
include all of our revenues and expenses.
Non-GAAP Earnings
This section discusses our first quarter 2016 non-GAAP financial
results, as compared to the first quarter of 2015 and the fourth
quarter of 2015. The phrases "adjusted net revenues", "adjusted
operating expenses", "adjusted operating income", "adjusted
operating margin" and "adjusted diluted net income per Unit" are
used in the following earnings discussion to identify non-GAAP
information. The most directly comparable US GAAP items are
reconciled to these non-GAAP items on pages 12-15 of this
release.
Adjusted net revenues of $590
million were down 7% compared to the first quarter of 2015,
due to lower advisory fees and higher net distribution expenses.
Sequentially, adjusted net revenues were down 3%, driven by the
same factors and partly offset by higher Bernstein Research
revenues and lower investment losses. Bernstein Research revenues
were essentially flat compared to the first quarter of 2015 and
increased 7% from the fourth quarter of 2015 as a result of a
volatility-driven increase in client activity in the US and
Asia.
Adjusted operating expenses were $458
million for the first quarter, down 5% compared to the
prior-year period, as total compensation and benefits, general and
administrative ("G&A") and promotion and servicing expenses
were all lower. The year-over-year decrease in total compensation
and benefits expenses was a result of lower incentive compensation,
commissions and fringes, partially offset by higher base
compensation. Within G&A, the decrease was primarily due to
lower other miscellaneous expenses. The decrease in promotion and
servicing expenses was due to lower marketing and travel and
entertainment expenses, partly offset by higher trade execution
fees.
Sequentially, adjusted operating expenses were up 3%, driven by
higher total compensation and benefits expenses, which were partly
offset by lower promotion and servicing and G&A expenses. The
sequential increase in total compensation and benefits expenses was
driven by higher base and incentive compensation, partly offset by
lower commissions, fringes and other employment costs. The
sequential decrease in promotion and servicing expenses was driven
by lower travel and entertainment expenses, partly offset by higher
trade execution fees. Within G&A, the decrease was driven by
lower professional fees.
Adjusted operating income of $132
million decreased 13% from $152
million for the first quarter of 2015, and the adjusted
operating margin decreased to 22.4% from 23.9%. On a sequential
basis, adjusted operating income decreased 19% from $162 million, and the adjusted operating margin
decreased from 26.7%.
Adjusted diluted net income per Unit was $0.40 compared to $0.45 in the first quarter of 2015 and
$0.50 in the fourth quarter of
2015.
US GAAP Earnings
Net revenues of $769 million were
up 1% compared to the first quarter of 2015, largely the result of
higher investment gains, partly offset by lower advisory fees and
distribution revenues. During the quarter we recorded a realized
gain of $75 million upon the close of
the sale of our investment in Jasper Technologies, Inc. to Cisco
Systems, Inc. Sequentially, net revenues increased 6% as a result
of investment gains in the current quarter compared to investment
losses in the previous period and higher Bernstein Research
revenues, partly offset by lower advisory fees and distribution
revenues.
Operating expenses were $596
million for the first quarter of 2016, down 2%
year-over-year, due to lower total compensation and benefits,
promotion and servicing and G&A expenses. Within employee
compensation and benefits expenses, lower incentive compensation,
commissions and fringes were partly offset by higher base
compensation, reflecting higher severance costs. Promotion and
servicing expenses decreased from the prior-year period due to
lower distribution-related payments, travel and entertainment and
marketing expenses and amortization of deferred sales commissions.
Within G&A, the decrease was primarily due to lower other
miscellaneous expenses. During the first quarter of 2016, we
recorded a $27.6 million non-cash
real estate charge, resulting from new charges of $28.5 million relating to the further
consolidation of office space at our New
York metro offices, offset by changes in estimates related
to previously recorded real estate charges. This compares to a
$0.4 million non-cash real estate
credit in the first quarter of 2015.
On a sequential basis, operating expenses were up 7% as a result
of higher total employee compensation and benefits expenses, partly
offset by lower promotion and servicing and G&A expenses.
Employee compensation and benefits expenses increased due to higher
incentive compensation, commissions and fringes and base
compensation, reflecting higher severance costs. Within promotion
and servicing, lower distribution plan payments and travel and
entertainment expense were partly offset by higher trade execution
fees. Within G&A, the decrease was driven by lower professional
fees. The $27.6 million non-cash real
estate charge in the current quarter compares to a $0.2 million non-cash real estate credit in the
fourth quarter of 2015.
Operating income of $173 million
for the first quarter of 2016 increased 13% from $153 million for the first quarter of 2015 and
increased 1% from $171 million in the
fourth quarter of 2015.
Diluted net income per Unit for the first quarter of 2016 was
$0.56 compared to $0.45 in the first quarter of 2015 and
$0.53 in the fourth quarter of
2015.
Headcount
As of March 31, 2016, we had 3,450
employees, compared to 3,486 employees as of March 31, 2015 and 3,600 employees as of
December 31, 2015.
Unit Repurchases
During the three months ended March 31,
2016 and 2015, we purchased 1.9 million and 0.7 million AB
Holding Units for $39.7 million and
$17.0 million, respectively (on a
trade date basis). These amounts reflect open-market purchases of
1.8 million and 0.6 million AB Holding Units for $38.1 million and $15.1
million, respectively, with the remainder relating to
purchases of AB Holding Units from employees to allow them to
fulfill statutory tax withholding requirements at the time of
distribution of long-term incentive compensation awards.
First Quarter 2016 Earnings Conference Call
Information
Management will review first quarter 2016 financial and
operating results during a conference call beginning at
8:00 a.m. (ET) on Thursday,
April 28, 2016. The conference call will be hosted by Peter S. Kraus, Chairman and Chief Executive
Officer, and John C. Weisenseel,
Chief Financial Officer.
Parties may access the conference call by either webcast or
telephone:
- To listen by webcast, please visit AB's Investor Relations
website at
http://abglobal.com/corporate/investor-relations/home.htm at least
15 minutes prior to the call to download and install any necessary
audio software.
- To listen by telephone, please dial (866) 556-2265 in the U.S.
or (973) 935-8521 outside the U.S. 10 minutes before the scheduled
start time. The conference ID# is 87493602.
The presentation that will be reviewed during the conference
call will be available on AB's Investor Relations website shortly
after the release of first quarter 2016 financial and
operating results on April 28, 2016.
AB will be providing live updates via Twitter during the
conference call. To access the tweets, follow AB on Twitter:
@AB_insights. Also, in the future, AB may provide public
disclosures to investors via Twitter and other appropriate
internet-based social media.
A replay of the webcast will be made available beginning
approximately one hour after the conclusion of the conference call
and will be available on AB's website for one week. An audio
replay of the conference call will also be available for one week.
To access the audio replay, please call (855) 859-2056 in the
US, or (404) 537-3406 outside the US, and provide the
conference ID #: 87493602.
Cautions Regarding Forward-Looking Statements
Certain statements provided by management in this news release
are "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. Such forward-looking
statements are subject to risks, uncertainties, and other factors
that could cause actual results to differ materially from future
results expressed or implied by such forward-looking statements.
The most significant of these factors include, but are not limited
to, the following: the performance of financial markets, the
investment performance of sponsored investment products and
separately-managed accounts, general economic conditions, industry
trends, future acquisitions, competitive conditions, and current
and proposed government regulations, including changes in tax
regulations and rates and the manner in which the earnings of
publicly-traded partnerships are taxed. AB cautions readers to
carefully consider such factors. Further, such forward-looking
statements speak only as of the date on which such statements are
made; AB undertakes no obligation to update any forward-looking
statements to reflect events or circumstances after the date of
such statements. For further information regarding these
forward-looking statements and the factors that could cause actual
results to differ, see "Risk Factors" and "Cautions Regarding
Forward-Looking Statements" in AB's Form 10-K for the year ended
December 31, 2015 and Form 10-Q for
the quarter ended March 31, 2016. Any
or all of the forward-looking statements made in this news release,
Form 10-K, Form 10-Q, other documents AB files with or furnishes to
the SEC, and any other public statements issued by AB, may turn out
to be wrong. It is important to remember that other factors besides
those listed in "Risk Factors" and "Cautions Regarding
Forward-Looking Statements", and those listed below, could also
adversely affect AB's financial condition, results of operations
and business prospects.
The forward-looking statements referred to in the preceding
paragraph include statements regarding:
- The pipeline of new institutional mandates not yet
funded: Before they are funded, institutional mandates do
not represent legally binding commitments to fund and, accordingly,
the possibility exists that not all mandates will be funded in the
amounts and at the times currently anticipated.
- Our expectation that, as a result of vacating and
marketing for sublease two floors in New
York during the first quarter of 2016, and recording real
estate charges totaling $28.5
million, approximately $3.7
million of annualized savings will be generated: Any
charges we record are based on our current assumptions regarding
sublease marketing periods, costs to prepare the properties to
market, market rental rates, broker commissions and subtenant
allowance/incentives, all of which are factors largely beyond our
control. If our assumptions prove to be incorrect, we may be forced
to record additional charges, which may result in annual savings
different from our current expectation.
- The possibility that AB will engage in open market
purchases of Holding Units to help fund anticipated obligations
under our incentive compensation award program: The number
of Holding Units AB may decide to buy in future periods, if any, to
help fund incentive compensation awards is dependent upon various
factors, some of which are beyond our control, including the
fluctuation in the price of a Holding Unit and the availability of
cash to make these purchases.
Qualified Tax Notice
This announcement is intended to be a qualified notice under
Treasury Regulation §1.1446-4(b). Please note that 100% of AB
Holding's distributions to foreign investors is attributable to
income that is effectively connected with a United States trade or business. Accordingly,
AB Holding's distributions to foreign investors are subject to
federal income tax withholding at the highest applicable tax rate,
currently 39.6%.
About AB
AB is a leading global investment management firm that offers
high-quality research and diversified investment services to
institutional investors, individuals and private wealth clients in
major world markets.
As of March 31, 2016, AB Holding
owned approximately 36.4% of the issued and outstanding AB Units
and AXA, one of the largest global financial services
organizations, owned an approximate 63.2% economic interest in
AB.
Additional information about AB may be found on our website,
www.abglobal.com.
AB (The Operating
Partnership)
|
|
|
|
|
|
|
|
|
|
Non-GAAP
Consolidated Statement of Income (Unaudited)
|
|
|
|
|
|
|
|
|
|
(US $
Thousands)
|
1Q
2016
|
|
1Q
2015
|
|
1Q 2016 vs.
1Q 2015 %
Change
|
|
4Q
2015
|
|
1Q 2016 vs.
4Q 2015 %
Change
|
|
|
|
|
|
|
|
|
|
|
Adjusted
revenues:
|
|
|
|
|
|
|
|
|
|
Base fees
|
$
|
448,332
|
|
|
$
|
487,378
|
|
|
(8.0%)
|
|
$
|
471,488
|
|
|
(4.9%)
|
Performance
fees
|
622
|
|
|
4,152
|
|
|
(85.0%)
|
|
3,513
|
|
|
(82.3%)
|
Bernstein research
services
|
126,465
|
|
|
126,046
|
|
|
0.3%
|
|
118,442
|
|
|
6.8%
|
Net distribution
revenues
|
(5,646)
|
|
|
(3,601)
|
|
|
56.8%
|
|
(4,295)
|
|
|
31.5%
|
Net dividends and
interest
|
7,219
|
|
|
4,943
|
|
|
46.0%
|
|
7,130
|
|
|
1.2%
|
Investments gains
(losses)
|
(374)
|
|
|
89
|
|
|
n/m
|
|
(4,146)
|
|
|
(91.0%)
|
Other
revenues
|
15,523
|
|
|
15,607
|
|
|
(0.5%)
|
|
15,508
|
|
|
0.1%
|
Total adjusted
revenues
|
592,141
|
|
|
634,614
|
|
|
(6.7%)
|
|
607,640
|
|
|
(2.6%)
|
Less: interest
expense
|
2,075
|
|
|
619
|
|
|
235.2%
|
|
1,269
|
|
|
63.5%
|
Total adjusted net
revenues
|
590,066
|
|
|
633,995
|
|
|
(6.9%)
|
|
606,371
|
|
|
(2.7%)
|
|
|
|
|
|
|
|
|
|
|
Adjusted operating
expenses:
|
|
|
|
|
|
|
|
|
|
Employee compensation
and benefits
|
302,223
|
|
|
323,677
|
|
|
(6.6%)
|
|
284,533
|
|
|
6.2%
|
Promotion and
servicing
|
45,115
|
|
|
46,285
|
|
|
(2.5%)
|
|
47,051
|
|
|
(4.1%)
|
General and
administrative
|
102,567
|
|
|
104,760
|
|
|
(2.1%)
|
|
105,431
|
|
|
(2.7%)
|
Contingent payment
arrangements
|
353
|
|
|
443
|
|
|
(20.3%)
|
|
443
|
|
|
(20.3%)
|
Interest
|
1,232
|
|
|
854
|
|
|
44.3%
|
|
817
|
|
|
50.8%
|
Amortization of
intangible assets
|
6,409
|
|
|
6,461
|
|
|
(0.8%)
|
|
6,414
|
|
|
(0.1%)
|
Net income (loss)
attributable to non-controlling interests
|
101
|
|
|
(98)
|
|
|
n/m
|
|
(64)
|
|
|
n/m
|
Total adjusted
operating expenses
|
458,000
|
|
|
482,382
|
|
|
(5.1%)
|
|
444,625
|
|
|
3.0%
|
|
|
|
|
|
|
|
|
|
|
Adjusted operating
income
|
132,066
|
|
|
151,613
|
|
|
(12.9%)
|
|
161,746
|
|
|
(18.3%)
|
|
|
|
|
|
|
|
|
|
|
Adjusted income
taxes
|
7,200
|
|
|
10,448
|
|
|
(31.1%)
|
|
7,978
|
|
|
(9.8%)
|
|
|
|
|
|
|
|
|
|
|
Adjusted net
income
|
$
|
124,866
|
|
|
$
|
141,165
|
|
|
(11.5%)
|
|
$
|
153,768
|
|
|
(18.8%)
|
|
|
|
|
|
|
|
|
|
|
AB Holding Adjusted
diluted EPU
|
$
|
0.40
|
|
|
$
|
0.45
|
|
|
(11.1%)
|
|
$
|
0.50
|
|
|
(20.0%)
|
|
|
|
|
|
|
|
|
|
|
Ending
headcount
|
3,450
|
|
|
3,486
|
|
|
(1.0%)
|
|
3,600
|
|
|
(4.2%)
|
|
|
|
|
|
|
|
|
|
|
Ending AUM (in
billions)
|
$
|
479.0
|
|
|
$
|
485.9
|
|
|
(1.4%)
|
|
$
|
467.4
|
|
|
2.5%
|
Average AUM (in
billions)
|
$
|
465.4
|
|
|
$
|
481.0
|
|
|
(3.2%)
|
|
$
|
470.9
|
|
|
(1.2%)
|
AB (The Operating
Partnership)
|
|
|
|
|
|
|
|
|
|
US GAAP
Consolidated Statement of Income (Unaudited)
|
|
|
|
|
|
|
|
|
|
(US $
Thousands)
|
1Q
2016
|
|
1Q
2015
|
|
1Q 2016 vs.
1Q 2015 %
Change
|
|
4Q
2015
|
|
1Q 2016 vs.
4Q 2015 %
Change
|
|
|
|
|
|
|
|
|
|
|
GAAP
revenues:
|
|
|
|
|
|
|
|
|
|
Base fees
|
$
|
450,791
|
|
|
$
|
489,836
|
|
|
(8.0%)
|
|
|
$
|
474,126
|
|
|
(4.9%)
|
|
Performance
fees
|
622
|
|
|
4,152
|
|
|
(85.0%)
|
|
|
3,513
|
|
|
(82.3%)
|
|
Bernstein research
services
|
126,465
|
|
|
126,046
|
|
|
0.3%
|
|
|
118,442
|
|
|
6.8%
|
|
Distribution
revenues
|
92,692
|
|
|
109,184
|
|
|
(15.1%)
|
|
|
100,757
|
|
|
(8.0%)
|
|
Dividends and
interest
|
7,370
|
|
|
5,094
|
|
|
44.7%
|
|
|
8,651
|
|
|
(14.8%)
|
|
Investments gains
(losses)
|
65,650
|
|
|
3,888
|
|
|
1,588.5%
|
|
|
(2,003)
|
|
|
n/m
|
|
Other
revenues
|
27,611
|
|
|
24,990
|
|
|
10.5%
|
|
|
24,509
|
|
|
12.7%
|
|
Total
revenues
|
771,201
|
|
|
763,190
|
|
|
1.0%
|
|
|
727,995
|
|
|
5.9%
|
|
Less: interest
expense
|
2,075
|
|
|
619
|
|
|
235.2%
|
|
|
1,269
|
|
|
63.5%
|
|
Total net
revenues
|
769,126
|
|
|
762,571
|
|
|
0.9%
|
|
|
726,726
|
|
|
5.8%
|
|
|
|
|
|
|
|
|
|
|
|
GAAP operating
expenses:
|
|
|
|
|
|
|
|
|
|
Employee compensation
and benefits
|
302,011
|
|
|
326,327
|
|
|
(7.5%)
|
|
|
286,399
|
|
|
5.5%
|
|
Promotion and
servicing
|
|
|
|
|
|
|
|
|
|
Distribution-related payments
|
87,127
|
|
|
100,386
|
|
|
(13.2%)
|
|
|
93,379
|
|
|
(6.7%)
|
|
Amortization of
deferred sales commissions
|
11,242
|
|
|
12,399
|
|
|
(9.3%)
|
|
|
11,673
|
|
|
(3.7%)
|
|
Other
|
54,201
|
|
|
55,537
|
|
|
(2.4%)
|
|
|
55,907
|
|
|
(3.1%)
|
|
General and
administrative
|
|
|
|
|
|
|
|
|
|
General
& administrative
|
105,923
|
|
|
107,333
|
|
|
(1.3%)
|
|
|
108,214
|
|
|
(2.1%)
|
|
Real
estate (credits) charges
|
27,586
|
|
|
(383)
|
|
|
n/m
|
|
|
(221)
|
|
|
n/m
|
|
Contingent payment
arrangements
|
353
|
|
|
443
|
|
|
(20.3%)
|
|
|
(6,769)
|
|
|
(105.2%)
|
|
Interest on
borrowings
|
1,232
|
|
|
854
|
|
|
44.3%
|
|
|
817
|
|
|
50.8%
|
|
Amortization of
intangible assets
|
6,409
|
|
|
6,461
|
|
|
(0.8%)
|
|
|
6,414
|
|
|
(0.1%)
|
|
Total operating
expenses
|
596,084
|
|
|
609,357
|
|
|
(2.2%)
|
|
|
555,813
|
|
|
7.2%
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
173,042
|
|
|
153,214
|
|
|
12.9%
|
|
|
170,913
|
|
|
1.2%
|
|
|
|
|
|
|
|
|
|
|
|
Income
taxes
|
9,864
|
|
|
10,470
|
|
|
(5.8%)
|
|
|
8,354
|
|
|
18.1%
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
163,178
|
|
|
142,744
|
|
|
14.3%
|
|
|
162,559
|
|
|
0.4%
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) of
consolidated entities attributable to non-controlling
interests
|
(5,748)
|
|
|
1,275
|
|
|
n/m
|
|
|
1,496
|
|
|
n/m
|
|
|
|
|
|
|
|
|
|
|
|
Net income
attributable to AB Unitholders
|
$
|
168,926
|
|
|
$
|
141,469
|
|
|
19.4%
|
|
|
$
|
161,063
|
|
|
4.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AB Holding L.P.
(The Publicly-Traded Partnership)
|
|
|
|
|
|
|
|
|
|
SUMMARY STATEMENTS
OF INCOME
|
|
|
|
|
|
|
|
|
|
(US $
Thousands)
|
1Q
2016
|
|
1Q
2015
|
|
1Q 2016 vs.
1Q 2015 %
Change
|
|
4Q
2015
|
|
1Q 2016 vs.
4Q 2015 %
Change
|
|
|
|
|
|
|
|
|
|
|
Equity in Net Income
Attributable to AB Unitholders
|
$
|
61,132
|
|
|
$
|
51,616
|
|
|
18.4%
|
|
|
$
|
57,485
|
|
|
6.3%
|
|
Income
Taxes
|
5,585
|
|
|
6,031
|
|
|
(7.4%)
|
|
|
5,803
|
|
|
(3.8%)
|
|
Net
Income
|
55,547
|
|
|
45,585
|
|
|
21.9%
|
|
|
51,682
|
|
|
7.5%
|
|
|
|
|
|
|
|
|
|
|
|
Additional Equity in
Earnings of Operating Partnership (1)
|
155
|
|
|
355
|
|
|
(56.3%)
|
|
|
310
|
|
|
(50.0%)
|
|
Net Income -
Diluted
|
$
|
55,702
|
|
|
$
|
45,940
|
|
|
21.2%
|
|
|
$
|
51,992
|
|
|
7.1%
|
|
Diluted Net Income
per Unit
|
$
|
0.56
|
|
|
$
|
0.45
|
|
|
24.4%
|
|
|
$
|
0.53
|
|
|
5.7%
|
|
Distribution per
Unit
|
$
|
0.40
|
|
|
$
|
0.45
|
|
|
(11.1%)
|
|
|
$
|
0.50
|
|
|
(20.0%)
|
|
|
|
|
|
|
|
|
|
|
|
(1) To reflect higher
ownership in the Operating Partnership resulting from application
of the treasury stock method to outstanding options.
|
|
|
|
|
|
|
|
|
|
|
|
|
Units
Outstanding
|
1Q
2016
|
|
1Q
2015
|
|
1Q 2016 vs.
1Q 2015 %
Change
|
|
4Q
2015
|
|
1Q 2016 vs.
4Q 2015 %
Change
|
AB L.P.
|
|
|
|
|
|
|
|
|
|
Period-end
|
270,638,334
|
|
|
272,607,593
|
|
|
(0.7%)
|
|
|
272,301,827
|
|
|
(0.6%)
|
|
Weighted average -
basic
|
271,853,243
|
|
|
272,831,439
|
|
|
(0.4%)
|
|
|
269,417,724
|
|
|
0.9%
|
|
Weighted average -
diluted
|
272,253,490
|
|
|
273,929,180
|
|
|
(0.6%)
|
|
|
270,238,983
|
|
|
0.7%
|
|
AB Holding
L.P.
|
|
|
|
|
|
|
|
|
|
Period-end
|
98,381,192
|
|
|
100,324,540
|
|
|
(1.9%)
|
|
|
100,044,485
|
|
|
(1.7%)
|
|
Weighted average -
basic
|
99,595,925
|
|
|
100,548,013
|
|
|
(0.9%)
|
|
|
97,160,266
|
|
|
2.5%
|
|
Weighted average -
diluted
|
99,996,172
|
|
|
101,645,754
|
|
|
(1.6%)
|
|
|
97,981,525
|
|
|
2.1%
|
|
AllianceBernstein
L.P.
|
|
|
ASSETS UNDER
MANAGEMENT | March 31, 2016
|
|
|
($
billions)
|
|
|
Ending and
Average
|
Three Months
Ended
|
|
|
3/31/16
|
3/31/15
|
|
Ending Assets Under
Management
|
$479.0
|
$485.9
|
|
Average Assets Under
Management
|
$465.4
|
$481.0
|
Three-Month
Changes By Distribution Channel
|
|
|
|
|
|
|
|
|
|
Institutions
|
|
Retail
|
|
Private Wealth
Management
|
|
Total
|
|
Beginning of
Period
|
$
|
236.2
|
|
|
$
|
154.4
|
|
|
$
|
76.8
|
|
|
$
|
467.4
|
|
|
Sales/New
accounts
|
4.5
|
|
|
7.7
|
|
|
3.2
|
|
|
15.4
|
|
|
Redemption/Terminations
|
(1.3)
|
|
|
(7.1)
|
|
|
(2.1)
|
|
|
(10.5)
|
|
|
Net Cash
Flows
|
(1.4)
|
|
|
(1.2)
|
|
|
(0.1)
|
|
|
(2.7)
|
|
|
Net
Flows
|
1.8
|
|
|
(0.6)
|
|
|
1.0
|
|
|
2.2
|
|
|
Investment
Performance
|
6.8
|
|
|
2.1
|
|
|
0.5
|
|
|
9.4
|
|
|
End of
Period
|
$
|
244.8
|
|
|
$
|
155.9
|
|
|
$
|
78.3
|
|
|
$
|
479.0
|
|
Three-Month
Changes By Investment Service
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity
Active
|
|
Equity
Passive (1)
|
|
Fixed
Income
Taxable
|
|
Fixed
Income
Tax-
Exempt
|
|
Fixed
Income
Passive (1)
|
|
Other
(2)
|
|
Total
|
|
Beginning of
Period
|
$
|
110.6
|
|
|
$
|
46.4
|
|
|
$
|
207.4
|
|
|
$
|
33.5
|
|
|
$
|
10.0
|
|
|
$
|
59.5
|
|
|
$
|
467.4
|
|
|
Sales/New
accounts
|
3.7
|
|
|
0.1
|
|
|
8.6
|
|
|
2.0
|
|
|
0.1
|
|
|
0.9
|
|
|
15.4
|
|
|
Redemption/Terminations
|
(3.8)
|
|
|
(0.4)
|
|
|
(4.4)
|
|
|
(1.1)
|
|
|
(0.1)
|
|
|
(0.7)
|
|
|
(10.5)
|
|
|
Net Cash
Flows
|
—
|
|
|
(0.5)
|
|
|
(1.4)
|
|
|
—
|
|
|
(0.2)
|
|
|
(0.6)
|
|
|
(2.7)
|
|
|
Net
Flows
|
(0.1)
|
|
|
(0.8)
|
|
|
2.8
|
|
|
0.9
|
|
|
(0.2)
|
|
|
(0.4)
|
|
|
2.2
|
|
|
Investment
Performance
|
(0.4)
|
|
|
(0.1)
|
|
|
8.9
|
|
|
0.6
|
|
|
0.5
|
|
|
(0.1)
|
|
|
9.4
|
|
|
End of
Period
|
$
|
110.1
|
|
|
$
|
45.5
|
|
|
$
|
219.1
|
|
|
$
|
35.0
|
|
|
$
|
10.3
|
|
|
$
|
59.0
|
|
|
$
|
479.0
|
|
(1)
Includes index and enhanced index services.
|
(2)
Includes multi-asset solutions and services and certain alternative
investments.
|
By Client
Domicile
|
|
|
|
|
|
|
|
|
|
Institutions
|
|
Retail
|
|
Private
Wealth
|
|
Total
|
|
U.S.
Clients
|
$
|
145.4
|
|
|
$
|
96.8
|
|
|
$
|
76.6
|
|
|
$
|
318.8
|
|
|
Non-U.S.
Clients
|
99.4
|
|
|
59.1
|
|
|
1.7
|
|
|
160.2
|
|
|
Total
|
$
|
244.8
|
|
|
$
|
155.9
|
|
|
$
|
78.3
|
|
|
$
|
479.0
|
|
First Quarter 2016
GAAP to Non-GAAP Reconciliation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In US $
Thousands
|
|
Adjustments
|
|
|
|
|
|
GAAP
|
|
Distribution
Related
Payments
|
|
Pass
Through
Expenses
|
|
Deferred
Comp.
Inv.
|
|
Consolidated
VIEs
|
|
Real
Estate
Charges
|
|
Contingent
Payment
Adjust
|
|
Acquisition-
Related
Expenses
|
|
Other
|
|
Non-
GAAP
|
|
|
|
|
|
(A)
|
|
(B)
|
|
(C)
|
|
(D)
|
|
(E)
|
|
(F)
|
|
(G)
|
|
(H)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment advisory
and services fees
|
$
|
451,413
|
|
|
|
|
$
|
(2,405)
|
|
|
|
|
$
|
(54)
|
|
|
|
|
|
|
|
|
|
|
$
|
448,954
|
|
|
Bernstein research
services
|
126,465
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
126,465
|
|
|
Distribution
revenues
|
92,692
|
|
|
(98,369)
|
|
|
|
|
|
|
31
|
|
|
|
|
|
|
|
|
|
|
(5,646)
|
|
|
Dividend and interest
income
|
7,370
|
|
|
|
|
|
|
(151)
|
|
|
|
|
|
|
|
|
|
|
|
|
7,219
|
|
|
Investment gains
(losses)
|
65,650
|
|
|
|
|
|
|
1,326
|
|
|
7,923
|
|
|
|
|
|
|
|
|
(75,273)
|
|
|
(374)
|
|
|
Other
revenues
|
27,611
|
|
|
|
|
(9,246)
|
|
|
|
|
(2,842)
|
|
|
|
|
|
|
|
|
|
|
15,523
|
|
|
|
Total
revenues
|
771,201
|
|
|
(98,369)
|
|
|
(11,651)
|
|
|
1,175
|
|
|
5,058
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(75,273)
|
|
|
592,141
|
|
|
Less: interest
expense
|
2,075
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,075
|
|
|
|
Net
revenues
|
769,126
|
|
|
(98,369)
|
|
|
(11,651)
|
|
|
1,175
|
|
|
5,058
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(75,273)
|
|
|
590,066
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employee compensation
and benefits
|
302,011
|
|
|
|
|
|
|
212
|
|
|
|
|
|
|
|
|
|
|
|
|
302,223
|
|
|
Promotion and
servicing
|
152,570
|
|
|
(98,369)
|
|
|
(9,086)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
45,115
|
|
|
General and
administrative
|
133,509
|
|
|
|
|
(2,565)
|
|
|
|
|
(791)
|
|
|
(27,586)
|
|
|
|
|
|
|
|
|
102,567
|
|
|
Contingent payment
arrangements
|
353
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
353
|
|
|
Interest on
borrowings
|
1,232
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,232
|
|
|
Amortization of
intangible assets
|
6,409
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,409
|
|
|
Net income (loss) of
consolidated entities attributable to non-controlling
interests
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
101
|
|
|
101
|
|
|
|
Total
expenses
|
596,084
|
|
|
(98,369)
|
|
|
(11,651)
|
|
|
212
|
|
|
(791)
|
|
|
(27,586)
|
|
|
—
|
|
|
—
|
|
|
101
|
|
|
458,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
173,042
|
|
|
—
|
|
|
—
|
|
|
963
|
|
|
5,849
|
|
|
27,586
|
|
|
—
|
|
|
—
|
|
|
(75,374)
|
|
|
132,066
|
|
|
Income
taxes
|
9,864
|
|
|
|
|
|
|
55
|
|
|
|
|
1,572
|
|
|
|
|
|
|
(4,291)
|
|
|
7,200
|
|
|
Net income
|
163,178
|
|
|
—
|
|
|
—
|
|
|
908
|
|
|
5,849
|
|
|
26,014
|
|
|
—
|
|
|
—
|
|
|
(71,083)
|
|
|
124,866
|
|
|
Net income (loss) of
consolidated entities attributable to non-controlling
interests
|
(5,748)
|
|
|
|
|
|
|
|
|
5,849
|
|
|
|
|
|
|
|
|
(101)
|
|
|
—
|
|
|
Net income
attributable to AB Unitholders
|
$
|
168,926
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
908
|
|
|
$
|
—
|
|
|
$
|
26,014
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(70,982)
|
|
|
$
|
124,866
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fourth Quarter
2015 GAAP to Non-GAAP Reconciliation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In US $
Thousands
|
|
Adjustments
|
|
|
|
|
GAAP
|
|
Distribution Related
Payments
|
|
Pass Through
Expenses
|
|
Deferred Comp.
Inv.
|
|
Venture Capital
Fund
|
|
Real Estate
Charges
|
|
Contingent Payment
Adjust
|
|
Acquisition-Related
Expenses
|
|
Other
|
|
Non-
GAAP
|
|
|
|
|
(A)
|
|
(B)
|
|
(C)
|
|
(D)
|
|
(E)
|
|
(F)
|
|
(G)
|
|
(H)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment advisory
and services fees
|
$
|
477,639
|
|
|
|
|
$
|
(2,638)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
475,001
|
|
Bernstein research
services
|
118,442
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
118,442
|
|
Distribution
revenues
|
100,757
|
|
|
(105,052)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4,295)
|
|
Dividend and interest
income
|
8,651
|
|
|
|
|
|
|
(1,521)
|
|
|
|
|
|
|
|
|
|
|
|
|
7,130
|
|
Investment gains
(losses)
|
(2,003)
|
|
|
|
|
|
|
(583)
|
|
|
(1,560)
|
|
|
|
|
|
|
|
|
|
|
(4,146)
|
|
Other
revenues
|
24,509
|
|
|
|
|
(9,001)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
15,508
|
|
|
Total
revenues
|
727,995
|
|
|
(105,052)
|
|
|
(11,639)
|
|
|
(2,104)
|
|
|
(1,560)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
607,640
|
|
Less: interest
expense
|
1,269
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,269
|
|
|
Net
revenues
|
726,726
|
|
|
(105,052)
|
|
|
(11,639)
|
|
|
(2,104)
|
|
|
(1,560)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
606,371
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employee compensation
and benefits
|
286,399
|
|
|
|
|
|
|
(1,866)
|
|
|
|
|
|
|
|
|
|
|
|
|
284,533
|
|
Promotion and
servicing
|
160,959
|
|
|
(105,052)
|
|
|
(8,856)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
47,051
|
|
General and
administrative
|
107,993
|
|
|
|
|
(2,783)
|
|
|
|
|
|
|
221
|
|
|
|
|
|
|
|
|
105,431
|
|
Contingent payment
arrangements
|
(6,769)
|
|
|
|
|
|
|
|
|
|
|
|
|
7,212
|
|
|
|
|
|
|
443
|
|
Interest on
borrowings
|
817
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
817
|
|
Amortization of
intangible assets
|
6,414
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,414
|
|
Net income (loss) of
consolidated entities attributable to non-controlling
interests
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(64)
|
|
|
(64)
|
|
|
Total
expenses
|
555,813
|
|
|
(105,052)
|
|
|
(11,639)
|
|
|
(1,866)
|
|
|
—
|
|
|
221
|
|
|
7,212
|
|
|
—
|
|
|
(64)
|
|
|
444,625
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
170,913
|
|
|
—
|
|
|
—
|
|
|
(238)
|
|
|
(1,560)
|
|
|
(221)
|
|
|
(7,212)
|
|
|
—
|
|
|
64
|
|
|
161,746
|
|
Income
taxes
|
8,354
|
|
|
|
|
|
|
(12)
|
|
|
|
|
(11)
|
|
|
(353)
|
|
|
|
|
|
|
7,978
|
|
Net income
|
162,559
|
|
|
—
|
|
|
—
|
|
|
(226)
|
|
|
(1,560)
|
|
|
(210)
|
|
|
(6,859)
|
|
|
—
|
|
|
64
|
|
|
153,768
|
|
Net income (loss) of
consolidated entities attributable to non-controlling
interests
|
1,496
|
|
|
|
|
|
|
|
|
(1,560)
|
|
|
|
|
|
|
|
|
64
|
|
|
—
|
|
Net income
attributable to AB Unitholders
|
$
|
161,063
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(226)
|
|
|
$
|
—
|
|
|
$
|
(210)
|
|
|
$
|
(6,859)
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
153,768
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First Quarter 2015
GAAP to Non-GAAP Reconciliation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In US $
Thousands
|
|
Adjustments
|
|
|
|
|
GAAP
|
|
Distribution Related
Payments
|
|
Pass Through
Expenses
|
|
Deferred Comp.
Inv.
|
|
Venture Capital
Fund
|
|
Real Estate
Charges
|
|
Contingent Payment
Adjust
|
|
Acquisition-Related
Expenses
|
|
Other
|
|
Non-
GAAP
|
|
|
|
|
(A)
|
|
(B)
|
|
(C)
|
|
(D)
|
|
(E)
|
|
(F)
|
|
(G)
|
|
(H)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment advisory
and services fees
|
$
|
493,988
|
|
|
|
|
$
|
(2,458)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
491,530
|
|
Bernstein research
services
|
126,046
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
126,046
|
|
Distribution
revenues
|
109,184
|
|
|
(112,785)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(3,601)
|
|
Dividend and interest
income
|
5,094
|
|
|
|
|
|
|
(151)
|
|
|
|
|
|
|
|
|
|
|
|
|
4,943
|
|
Investment gains
(losses)
|
3,888
|
|
|
|
|
|
|
(2,426)
|
|
|
(1,373)
|
|
|
|
|
|
|
|
|
|
|
89
|
|
Other
revenues
|
24,990
|
|
|
|
|
(9,383)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
15,607
|
|
|
Total
revenues
|
763,190
|
|
|
(112,785)
|
|
|
(11,841)
|
|
|
(2,577)
|
|
|
(1,373)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
634,614
|
|
Less: interest
expense
|
619
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
619
|
|
|
Net
revenues
|
762,571
|
|
|
(112,785)
|
|
|
(11,841)
|
|
|
(2,577)
|
|
|
(1,373)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
633,995
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Employee compensation
and benefits
|
326,327
|
|
|
|
|
|
|
(2,634)
|
|
|
|
|
|
|
|
|
(16)
|
|
|
|
|
323,677
|
|
Promotion and
servicing
|
168,322
|
|
|
(112,785)
|
|
|
(9,252)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
46,285
|
|
General and
administrative
|
106,950
|
|
|
|
|
(2,589)
|
|
|
|
|
|
|
383
|
|
|
|
|
16
|
|
|
|
|
104,760
|
|
Contingent payment
arrangements
|
443
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
443
|
|
Interest on
borrowings
|
854
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
854
|
|
Amortization of
intangible assets
|
6,461
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,461
|
|
Net income (loss) of
consolidated entities attributable to non-controlling
interests
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(98)
|
|
|
(98)
|
|
|
Total
expenses
|
609,357
|
|
|
(112,785)
|
|
|
(11,841)
|
|
|
(2,634)
|
|
|
—
|
|
|
383
|
|
|
—
|
|
|
—
|
|
|
(98)
|
|
|
482,382
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
|
153,214
|
|
|
—
|
|
|
—
|
|
|
57
|
|
|
(1,373)
|
|
|
(383)
|
|
|
—
|
|
|
—
|
|
|
98
|
|
|
151,613
|
|
Income
taxes
|
|
10,470
|
|
|
|
|
|
|
4
|
|
|
|
|
(26)
|
|
|
|
|
|
|
|
|
10,448
|
|
Net income
|
|
142,744
|
|
|
—
|
|
|
—
|
|
|
53
|
|
|
(1,373)
|
|
|
(357)
|
|
|
—
|
|
|
—
|
|
|
98
|
|
|
141,165
|
|
Net income (loss) of
consolidated entities attributable to non-controlling
interests
|
1,275
|
|
|
|
|
|
|
|
|
(1,373)
|
|
|
|
|
|
|
|
|
98
|
|
|
—
|
|
Net income
attributable to AB Unitholders
|
$
|
141,469
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
53
|
|
|
$
|
—
|
|
|
$
|
(357)
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
141,165
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AB
Notes to Consolidated Statements of
Income and Supplemental Information
(Unaudited)
A. Adjusted net revenues exclude
distribution-related payments to third parties as well as
amortization of deferred sales commissions against distribution
revenues. We believe excluding distribution-related payments from
net revenues is useful for our investors and other users of our
financial statements because such presentation appropriately
reflects the nature of these costs as pass-through payments to
third parties who perform functions on behalf of our sponsored
mutual funds and/or shareholders of these funds. We exclude
amortization of deferred sales commissions from net revenues
because such costs, over time, essentially offset our distribution
revenues. These adjustments have no impact on operating income, but
they do have an impact on our operating margin.
B. We exclude pass-through expenses we
incur (primarily through our transfer agency) that are reimbursed
and recorded as fees in revenues from our adjusted net revenues.
These fees have no impact on operating income, but they do have an
impact on our operating margin.
C. Prior to 2009, a significant portion of
employee compensation was in the form of long-term incentive
compensation awards that were notionally invested in AB investment
services and generally vested over a period of four years. AB
economically hedged the exposure to market movements by purchasing
and holding these investments on its balance sheet. All such
investments had vested by year-end 2012 and the investments have
been distributed to the participants, except for those investments
with respect to which the participant elected a long-term deferral.
Fluctuation in the value of these investments is recorded within
investment gains and losses on the income statement and also
impacts compensation expense. Management believes it is useful to
reflect the offset achieved from economically hedging the
investments' market exposure in the calculation of adjusted
operating income and adjusted operating margin. The non-GAAP
measures exclude gains and losses and dividends and interest on
employee long-term incentive compensation-related investments
included in revenues and compensation expense.
D. Most of the net income or loss of
consolidated entities attributable to non-controlling interests
relates to the 90% limited partner interests held by third parties
in our consolidated venture capital fund. We own a 10% limited
partner interest in the fund. Because we are the general partner of
the venture capital fund and are deemed to have a controlling
interest, US GAAP requires us to consolidate the financial results
of the fund. However, recognizing 100% of the gains or losses in
net revenues and operating income while only retaining 10% is not
reflective of our underlying financial results at the net revenue
and operating income level. As a result, we exclude the 90% limited
partner interests we do not own from our adjusted net revenues and
adjusted operating income. Effective January
1, 2016, our consolidated venture capital fund is included
with other consolidated VIEs. In 2016, we adjusted for the
revenue impact of consolidating certain VIEs (as a result of the
adoption of a new accounting standard; see Note 2 to our condensed
consolidated financial statements). This adjustment reflects the
elimination of the consolidated VIEs revenues and expenses and the
inclusion of AB's revenues and expenses from such VIEs and AB's
investment gains and losses on its investments in such VIEs that
were eliminated in consolidation.
E. Real estate (credits)/charges have
been excluded because they are not considered part of our core
operating results when comparing financial results from period to
period and to industry peers.
F. Recording changes in estimates of the
contingent consideration associated with a 2010 acquisition have
been excluded because this is not considered part of our core
operating results.
G. Acquisition-related expenses, primarily
severance and professional fees incurred as a result of
acquisitions in the fourth quarter of 2013 and the second quarter
of 2014, have been excluded because they are not considered part of
our core operating results when comparing results from period to
period and to industry peers.
H. Net income of joint ventures attributable
to non-controlling interests, although not significant, is excluded
because it does not reflect the economic interest attributable to
AB. In addition, in 2016 we excluded a realized gain on an
investment carried at cost due to its' non-recurring nature and it
not being part of our core operating results.
Adjusted Operating Margin
Adjusted operating margin
allows us to monitor our financial performance and efficiency from
period to period without the volatility noted above in our
discussion of adjusted operating income and to compare our
performance to industry peers on a basis that better reflects our
performance in our core business. Adjusted operating margin is
derived by dividing adjusted operating income by adjusted net
revenues.
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/alliancebernstein-holding-lp-announces-first-quarter-results-300259253.html
SOURCE AllianceBernstein Holding L.P.