BOSTON, Feb. 24, 2021 /PRNewswire/ -- Eaton Vance
Corp. (NYSE: EV) today reported earnings of $0.74 per diluted share for the first quarter of
fiscal 2021, which compares to earnings of $0.91 per diluted share in the first quarter of
fiscal 2020 and $(0.31) per diluted
share in the fourth quarter of fiscal 2020.
The Company reported record quarterly adjusted
earnings([1]) of $0.94 per diluted share for the first quarter of
fiscal 2021, an increase of 11 percent from $0.85 of adjusted earnings per diluted share in
the first quarter of fiscal 2020 and an increase of 7 percent from
$0.88 of adjusted earnings per
diluted share in the fourth quarter of fiscal 2020.
In the first quarter of fiscal 2021, adjusted earnings exceeded
earnings under U.S. generally accepted accounting principles (U.S.
GAAP) by $0.20 per diluted share,
reflecting the reversal of $70.6
million of compensation expenses and other costs recognized
in connection with the proposed acquisition of Eaton Vance by
Morgan Stanley announced on October 8,
2020, the reversal of $27.3
million of net excess tax benefits related to stock–based
compensation awards, the reversal of $20.1
million of net gains of consolidated sponsored funds and
consolidated collateralized loan obligation (CLO) entities
(collectively, consolidated investment entities) and the Company's
other seed capital investments, and the add-back of $2.2 million of management fees and expenses of
consolidated investment entities. Earnings under U.S. GAAP exceeded
adjusted earnings by $0.06 per
diluted share in the first quarter of fiscal 2020, reflecting the
reversal of $4.9 million of net
excess tax benefits related to stock-based compensation awards, the
reversal of $3.6 million of net gains
of consolidated investment entities and other seed capital
investments, and the add-back of $2.4
million of management fees and expenses of consolidated
investment entities. In the fourth quarter of fiscal 2020, adjusted
earnings exceeded earnings under U.S. GAAP by $1.19 per diluted share, reflecting the reversal
of $114.9 million of compensation
expenses and other costs recognized in connection with the proposed
acquisition of Eaton Vance by Morgan Stanley, the reversal of a
$21.8 million impairment loss
recognized on the Company's investment in Hexavest Inc. (Hexavest),
the reversal of $2.9 million of net
excess tax benefits related to stock–based compensation awards, the
reversal of $1.8 million of net
losses of consolidated investment entities and other seed capital
investments, and the add-back of $1.7
million of management fees and expenses of consolidated
investment entities.
In the first quarter of fiscal 2021, the Company had record
quarterly consolidated net inflows of $20.0
billion, representing 16 percent annualized internal growth
in managed assets (consolidated net flows divided by beginning of
period consolidated assets under management). This compares to net
inflows of $6.1 billion and 5 percent
annualized internal growth in managed assets in the first quarter
of fiscal 2020 and net inflows of $5.2
billion and 4 percent annualized internal growth in managed
assets in the fourth quarter of fiscal 2020. Excluding Parametric
overlay services, the Company had net inflows of $6.9 billion and 7 percent annualized internal
growth in managed assets in the first quarter of fiscal 2021, net
inflows of $5.0 billion and 5 percent
annualized internal growth in managed assets in the first quarter
of fiscal 2020, and net inflows of $4.8
billion and 5 percent annualized internal growth in managed
assets in the fourth quarter of fiscal 2020.
The Company's internal management fee revenue growth (management
fees attributable to consolidated inflows less management fees
attributable to consolidated outflows, divided by beginning of
period consolidated management fee revenue) was 8 percent in the
first quarter of fiscal 2021 and 5 percent in both the first
quarter and the fourth quarter of fiscal 2020.
Consolidated assets under management were a record $584.2 billion on January
31, 2021, up 13 percent from $518.2
billion of consolidated managed assets on January 31, 2020 and $515.7 billion of consolidated managed assets on
October 31, 2020. The year-over-year
increase in consolidated assets under management reflects
$18.6 billion of net inflows,
$45.1 billion of price appreciation
in managed assets and $2.3 billion of
new managed assets gained in the acquisition of the business assets
of WaterOak Advisors, LLC (WaterOak) on October 16, 2020. The sequential increase in
consolidated assets under management in the first quarter of fiscal
2021 reflects $20.0 billion of
quarterly net inflows and $48.5
billion of price appreciation in managed assets.
"In what we expect will be Eaton Vance's last quarterly
reporting period as an independent public company, the Company set
new records for consolidated net inflows, consolidated ending
assets under management, adjusted operating income and adjusted
earnings per diluted share," said Thomas E.
Faust Jr., Chairman and Chief Executive Officer. "We
approach the Company's acquisition by Morgan Stanley with strong
momentum across our businesses, and look forward to building on
that strength as part of Morgan Stanley Investment Management."
Average consolidated assets under management were $562.2 billion in the first quarter of fiscal
2021, up 10 percent from $509.9
billion in the first quarter of fiscal 2020 and up 9 percent
from $516.7 billion in the fourth
quarter of fiscal 2020.
Attachments 5 and 6 summarize the Company's consolidated assets
under management and net flows by investment mandate and investment
vehicle reporting categories. Among investment mandate reporting
categories, consolidated net inflows in the first quarter of fiscal
2021 were $13.1 billion for
Parametric overlay services, $3.5
billion for fixed income, $2.4
billion for Parametric custom portfolios, $608 million for floating-rate income,
$214 million for equity and
$191 million for alternative
mandates. Annualized internal growth in managed assets for the
first quarter of fiscal 2021 was 55 percent for Parametric overlay
services, 19 percent for fixed income, 10 percent for alternative,
8 percent for floating-rate income, 6 percent for Parametric custom
portfolios and 1 percent for equity mandates. Annualized internal
growth in management fee revenue for the first quarter of fiscal
2021 was 51 percent for Parametric overlay services, 21 percent for
fixed income, 11 percent for Parametric custom portfolios, 10
percent for alternative, 6 percent for floating-rate income and -1
percent for equity mandates.
By investment affiliate, consolidated net inflows in the first
quarter of fiscal 2021 were $14.9
billion for Parametric, $4.0
billion for Eaton Vance Management (EVM), $1.6 billion for Calvert and $(517) million for Atlanta Capital. Annualized
internal growth in managed assets for the first quarter of 2021 was
24 percent for Calvert, 19 percent for Parametric, 10 percent for
EVM and -8 percent for Atlanta Capital. Annualized internal growth
in management fee revenue for the first quarter of fiscal 2021 was
26 percent for Calvert, 9 percent for EVM, 7 percent for Parametric
and -13 percent for Atlanta Capital.
Attachments 7, 8 and 9 summarize the Company's ending
consolidated assets under management by investment mandate,
investment vehicle and investment affiliate. Attachment 10 shows
the Company's average annualized management fee rates by investment
mandate.
As of January 31, 2021, managed
assets of the Company's 49 percent-owned affiliate Hexavest were
$4.3 billion, down 67 percent from
$13.0 billion of managed assets on
January 31, 2020 and down 26 percent
from $5.8 billion of managed assets
on October 31, 2020. Hexavest had net
outflows of $2.2 billion in the first
quarter of fiscal 2021, $0.5 billion
in the first quarter of fiscal 2020 and $0.9
billion in the fourth quarter of fiscal 2020. Attachment 11
summarizes the assets under management and net flows of Hexavest.
Other than Eaton Vance-sponsored funds for which Hexavest is the
adviser or sub-adviser, the managed assets and flows of Hexavest
are not included in our consolidated totals.
|
|
|
|
|
|
|
(1)
|
Adjusted financial
measures represent non-U.S GAAP financial measures. See Attachment
2 for reconciliations to the most directly comparable U.S. GAAP
financial measures and other important disclosures.
|
|
Financial
Highlights
|
|
|
|
|
|
(in thousands,
except per share figures)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
January
31,
|
October
31,
|
January
31,
|
|
|
2021
|
2020
|
2020
|
|
U.S. GAAP
Financial Measures:
|
|
|
|
|
|
|
|
Revenue
|
$
|
488,946
|
$
|
451,081
|
$
|
452,554
|
|
Expenses
|
$
|
409,424
|
$
|
464,737
|
$
|
317,835
|
|
Operating income
(loss)
|
$
|
79,522
|
$
|
(13,656)
|
$
|
134,719
|
|
Operating margin
|
|
16.3%
|
|
(3.0)%
|
|
29.8%
|
|
Net income (loss)
attributable to
|
|
|
|
|
|
|
|
Eaton
Vance Corp. shareholders
|
$
|
89,914
|
$
|
(35,934)
|
$
|
103,985
|
|
Earnings (loss) per
diluted share
|
$
|
0.74
|
$
|
(0.31)
|
$
|
0.91
|
|
|
|
|
|
|
|
|
Adjusted Non-U.S.
GAAP Financial Measures:(1)
|
|
|
|
|
|
|
|
Revenue
|
$
|
490,917
|
$
|
452,485
|
$
|
454,479
|
|
Expenses
|
$
|
327,459
|
$
|
309,344
|
$
|
316,548
|
|
Operating
income
|
$
|
163,458
|
$
|
143,141
|
$
|
137,931
|
|
Operating margin
|
|
33.3%
|
|
31.6%
|
|
30.3%
|
|
Net income
attributable to
|
|
|
|
|
|
|
|
Eaton
Vance Corp. shareholders
|
$
|
115,269
|
$
|
101,503
|
$
|
97,947
|
|
Earnings per diluted
share
|
$
|
0.94
|
$
|
0.88
|
$
|
0.85
|
|
|
|
|
|
|
|
|
Weighted Average
Shares Outstanding:
|
|
|
|
|
|
|
|
Basic
|
|
116,220
|
|
110,701
|
|
109,380
|
|
Diluted
|
|
122,279
|
|
115,878
|
|
114,688
|
|
|
|
|
|
|
|
|
|
(1) See Attachment 2 for reconciliations between the
U.S. GAAP and adjusted non-U.S. GAAP financial measures identified
here as well as other important disclosures.
|
First Quarter Fiscal 2021 vs. First Quarter Fiscal
2020
In the first quarter of fiscal 2021, revenue increased 8 percent
to $488.9 million from $452.6 million in the first quarter of fiscal
2020. Management fees were up 9 percent, as a 10 percent increase
in average consolidated assets under management more than offset a
1 percent decrease in the Company's consolidated average annualized
management fee rate. Performance fees were $0.2 million in both the first quarter of
fiscal 2021 and the first quarter of fiscal 2020. Distribution and
service fee revenues in the first quarter of fiscal 2021 were
collectively up 2 percent from the first quarter of fiscal 2020,
reflecting higher average managed assets in fund share classes that
are subject to these fees.
Operating expenses increased 29 percent to $409.4 million in the first quarter of fiscal
2021 from $317.8 million in the first
quarter of fiscal 2020, reflecting increases in compensation
expense, service fee expense, amortization of deferred sales
commissions, fund-related expenses and other operating expenses,
partially offset by a decrease in distribution expense. The
increase in compensation expense primarily reflects $39.6 million of stock-based and other
compensation costs and associated payroll taxes recognized in the
first quarter of fiscal 2021 in connection with the proposed
acquisition of Eaton Vance by Morgan Stanley. The increase in
compensation expense further reflects higher salary and benefit
expense associated with increases in headcount, higher operating
income-based and investment performance-based bonus accruals, and
higher sales-based incentive compensation, partially offset by
lower severance expenses. The increase in service fee expense
reflects higher private fund and Class A service fee payments,
partially offset by lower Class C service fee payments. The
increase in amortization of deferred sales commissions reflects
higher private fund commission amortization. The increase in
fund-related expenses reflects higher sub-advisory fees paid,
partially offset by a reduction in fund expenses borne by the
Company. Other operating expenses increased 69 percent, primarily
reflecting higher professional service expenses driven by proxy
solicitation fees and other legal and consulting costs associated
with the proposed acquisition of Eaton Vance by Morgan Stanley, and
an increase in information technology spending, partially offset by
lower travel expenses. The decline in distribution expense reflects
lower Class C distribution fee payments, up-front sales commission
expense, promotional costs and finder's fees, partially offset by
higher intermediary marketing support payments. Excluding expenses
in connection with the proposed acquisition of Eaton Vance by
Morgan Stanley and other adjustments as shown in Attachment 2,
operating expenses in the first quarter of fiscal 2021 were
$327.5 million, an increase of 3
percent from operating expenses of $316.5
million in the first quarter of fiscal 2020.
Operating income decreased to $79.5
million in the first quarter of fiscal 2021 from
$134.7 million in the first quarter
of fiscal 2020, primarily reflecting $81.0
million of compensation expense and other costs recognized
in the first quarter of fiscal 2021 in connection with the proposed
acquisition of Eaton Vance by Morgan Stanley. The Company's
operating margin decreased to 16.3 percent in the first quarter of
fiscal 2021 from 29.8 percent in the first quarter of fiscal
2020.
As shown in Attachment 2, the Company's operating income on an
adjusted basis was a quarterly record of $163.5 million in the first quarter of fiscal
2021, an increase of 19 percent from $137.9
million of adjusted operating income in the first quarter of
fiscal 2020. The Company's adjusted operating margin increased to
33.3 percent in the first quarter of fiscal 2021 from 30.3 percent
in the first quarter of fiscal 2020.
Non-operating income totaled $41.2
million in the first quarter of fiscal 2021 and $8.4 million in the first quarter of fiscal 2020.
The year-over-year increase reflects a $25.1
million improvement in net income (expense) of consolidated
CLO entities, primarily driven by gains realized upon the sale of
the Company's interests in four CLO entities that the Company no
longer consolidates, but continues to manage, and a $7.7 million increase in net gains and other
investment income of consolidated sponsored funds and the Company's
investments in other sponsored strategies.
The Company's effective tax rate, calculated as a percentage of
income before income taxes and equity in net income of affiliates,
was 7.5 percent in the first quarter of fiscal 2021 and 22.8
percent in the first quarter of fiscal 2020. The Company's
effective tax rate is discussed in greater detail under "Taxation"
below.
Equity in net income of affiliates was $0.6 million and $2.3
million in the first quarters of fiscal 2021 and 2020,
respectively, substantially all relating to the Company's
investment in Hexavest.
As detailed in Attachment 3, net income attributable to
non-controlling and other beneficial interests was $22.4 million in the first quarter of fiscal 2021
and $8.9 million in the first quarter
of fiscal 2020. The year-over-year change primarily reflects an
increase in income earned by consolidated sponsored funds.
The Company's weighted average basic shares outstanding were
116.2 million in the first quarter of fiscal 2021 and 109.4 million
in the first quarter of fiscal 2020, an increase of 6 percent. The
year-over-year increase reflects new shares issued upon the vesting
of restricted stock awards and the exercise of employee stock
options. On a diluted basis, the Company's weighted average shares
outstanding were 122.3 million in the first quarter of fiscal 2021
and 114.7 million in the first quarter of fiscal 2020, an increase
of 7 percent. The change in weighted average diluted shares
outstanding further reflects an increase in the dilutive effect of
in-the-money options due to higher market prices of the Company's
non-voting common stock, partially offset by a decrease in the
dilutive effect of restricted stock awards due to the accelerated
vesting of restricted stock awards in the fourth quarter of fiscal
2020 in connection with the proposed acquisition of Eaton Vance by
Morgan Stanley.
First Quarter Fiscal 2021 vs. Fourth Quarter Fiscal
2020
In the first quarter of fiscal 2021, revenue increased 8 percent
to $488.9 million from $451.1 million in the fourth quarter of fiscal
2020. Management fees were up 9 percent, primarily reflecting a 9
percent increase in average consolidated assets under management.
Performance fees were $0.2 million in
the first quarter of fiscal 2021, versus $1.5 million in the fourth quarter of fiscal
2020. Distribution and service fee revenues in the first quarter of
fiscal 2021 were collectively up 7 percent from the fourth quarter
of fiscal 2020, reflecting higher average managed assets in fund
share classes that are subject to these fees.
Operating expenses decreased 12 percent to $409.4 million in the first quarter of fiscal
2021 from $464.7 million in the
fourth quarter of fiscal 2020, reflecting lower compensation
expense, partially offset by increases in distribution expense,
service fee expense, amortization of deferred sales commissions,
fund-related expenses and other operating expenses. The decrease in
compensation expense primary reflects a reduction in stock-based
compensation expense due to the acceleration of $146.0 million of expense recognized in the
fourth quarter of fiscal 2020 in connection with the proposed
acquisition of Eaton Vance by Morgan Stanley, partially offset by
$39.6 million of stock-based and
other compensation costs and associated payroll taxes recognized in
the first quarter of fiscal 2021 in connection with the proposed
acquisition. The decrease in compensation expense further reflects
lower operating income-based bonus accruals, partially offset by
higher sales-based incentive compensation, higher performance-based
bonus accruals and higher salary and benefit expense associated
with year-end compensation increases for continuing employees and
slightly higher headcount, and seasonal increases in benefit costs
and payroll taxes. The increase in distribution expense reflects
higher intermediary marketing support payments, partially offset by
a decrease in promotion costs and lower Class C distribution fee
payments. The increase in service fee expense reflects higher
private fund and Class A service fee payments. The increase in
fund-related expenses reflects higher sub-advisory fees paid. Other
operating expenses increased 52 percent, primarily reflecting
higher professional service expenses driven by increases in proxy
solicitation fees and other legal costs associated with the
proposed acquisition of Eaton Vance by Morgan Stanley. Excluding
expenses in connection with the proposed acquisition of Eaton Vance
by Morgan Stanley and other adjustments as shown in Attachment 2,
operating expenses in the first quarter of fiscal 2021 were
$327.5 million, an increase of 6
percent from operating expenses of $309.3
million in the fourth quarter of fiscal 2020.
Operating income (loss) increased to $79.5 million in the first quarter of fiscal 2021
from $(13.7) million in the fourth
quarter of fiscal 2020. The sequential change primarily reflects a
$73.4 million decrease in
compensation expense and other costs recognized in connection with
the proposed acquisition of Eaton Vance by Morgan Stanley. The
Company's operating margin increased to 16.3 percent in the first
quarter of fiscal 2021 from (3.0) percent in the fourth quarter of
fiscal 2020.
As shown in Attachment 2, the Company's $163.5 million of adjusted operating income in
the first quarter of fiscal 2021 compared to $143.1 million of adjusted operating income in
the fourth quarter of fiscal 2020, an increase of 14 percent. The
Company's adjusted operating margin increased to 33.3 percent in
the first quarter of fiscal 2021 from 31.6 percent in the fourth
quarter of fiscal 2020.
Non-operating income totaled $41.2
million in the first quarter of fiscal 2021 versus
$7.1 million of non-operating expense
in the fourth quarter of fiscal 2020. The sequential change
reflects a $28.6 million improvement
in net income (expense) of consolidated CLO entities, primarily
driven by gains realized upon the sale of the Company's interests
in four CLO entities that the Company no longer consolidates, but
continues to manage, and a $19.8
million increase in net gains and other investment income of
consolidated sponsored funds and the Company's investments in other
sponsored strategies.
The Company's effective tax rate, calculated as a percentage of
income (loss) before income taxes and equity in net income of
affiliates, was 7.5 percent in the first quarter of fiscal 2021 and
36.6 percent in the fourth quarter of fiscal 2020. The Company's
effective tax rate is discussed in greater detail under "Taxation"
below.
Equity in net income (loss) of affiliates was $0.6 million in the first quarter of fiscal 2021
and $(20.8) million in the fourth
quarter of fiscal 2020, respectively. In both the first quarter of
fiscal 2021 and the fourth quarter of fiscal 2020, substantially
all of the Company's equity in net income of affiliates related to
the Company's investment in Hexavest. Equity in net income (loss)
of affiliates in the fourth quarter of fiscal 2020 included a
$21.8 million impairment loss
recognized on the Company's investment in Hexavest.
As detailed in Attachment 3, net income attributable to
non-controlling and other beneficial interests was $22.4 million in the first quarter of fiscal 2021
and $2.0 million in the fourth
quarter of fiscal 2020. The sequential change primarily reflects an
increase in income earned by consolidated sponsored funds.
The Company's weighted average basic shares outstanding were
116.2 million in the first quarter of fiscal 2021 and 110.7 million
in the fourth quarter of fiscal 2020, an increase of 5 percent. The
increase reflects new shares issued upon the vesting of restricted
stock awards and the exercise of employee stock options. On a
diluted basis, the Company's weighted average shares outstanding
were 122.3 million in the first quarter of fiscal 2021 and 115.9
million in the fourth quarter of fiscal 2020, an increase of 6
percent. The change in weighted average diluted shares outstanding
further reflects an increase in the dilutive effect of in-the-money
options due to higher market prices of the Company's non-voting
common stock, partially offset by a decrease in the dilutive effect
of restricted stock awards due to the accelerated vesting of
restricted stock awards in the fourth quarter of fiscal 2020 in
connection with the proposed acquisition of Eaton Vance by Morgan
Stanley.
Taxation
The following table reconciles the U.S. statutory federal income
tax rate to the Company's effective income tax rate:
|
|
Three Months
Ended
|
|
|
January
31,
|
October
31,
|
January
31,
|
|
|
2021
|
2020
|
2020
|
|
Statutory U.S.
federal income tax rate
|
21.0
|
%
|
21.0
|
%
|
21.0
|
%
|
|
State income tax, net
of federal income tax benefits
|
4.0
|
|
5.8
|
|
4.9
|
|
|
Net income (loss)
attributable to non-controlling
|
|
|
|
|
|
|
|
and
other beneficial interests
|
(3.6)
|
|
2.0
|
|
(0.5)
|
|
|
Non-deductible costs
related to the proposed
|
|
|
|
|
|
|
|
acquisition of Eaton Vance by Morgan Stanley
|
8.4
|
|
-
|
|
-
|
|
|
Other
items
|
0.3
|
|
(6.0)
|
|
0.8
|
|
|
Net excess tax
benefits from stock-based
|
|
|
|
|
|
|
|
compensation plans(1)
|
(22.6)
|
|
13.8
|
|
(3.4)
|
|
|
Effective income tax
rate
|
7.5
|
%
|
36.6
|
%
|
22.8
|
%
|
|
|
|
|
|
|
|
|
|
(1) Represents net excess tax benefits from
stock-based compensation plans. Amounts have been reduced for
executive compensation limitations under Section 162(m) of the
Internal Revenue Code.
|
The net loss experienced by the Company in the fourth quarter of
fiscal 2020 resulted in a tax benefit being recognized during the
quarter.
The Company's income tax provision was reduced by net excess tax
benefits related to stock-based compensation awards totaling
$27.3 million in the first quarter of
fiscal 2021, $4.9 million in the
first quarter of fiscal 2020 and $2.9
million in the fourth quarter of fiscal 2020. The Company's
income tax provision is also impacted by other items, which include
non-deductible executive compensation, prior period adjustments
primarily related to the filing of tax returns and other
differences in the treatment of certain items for book and tax
purposes.
As shown in Attachment 2, the Company's calculations of adjusted
net income and adjusted earnings per diluted share remove
compensation expenses and other costs related to the proposed
acquisition of Eaton Vance by Morgan Stanley, remove the impairment
losses recognized in the fourth quarter of fiscal 2020 on the
Company's investment in 49 percent-owned affiliate Hexavest,
exclude gains (losses) and other investment income (expense) of
consolidated investment entities and other seed capital
investments, add back the management fees and expenses of
consolidated investment entities and exclude the tax impact of
stock-based compensation shortfalls or windfalls. On this basis,
the Company's adjusted effective tax rate was 25.8 percent in the
first quarter of fiscal 2021, 27.6 percent in the first quarter of
fiscal 2020 and 26.2 percent in the fourth quarter of fiscal
2020.
Balance Sheet Information
As of January 31, 2021, the
Company held cash and cash equivalents of $606.1 million and its investments included
$20.4 million of short-term debt
securities with maturities between 90 days and one year. There were
no outstanding borrowings under the Company's $300 million credit facility at such date.
Proposed Acquisition of Eaton Vance by Morgan Stanley
As described above, Eaton Vance and Morgan Stanley announced on
October 8, 2020 that they have
entered into a definitive agreement for Morgan Stanley to acquire
Eaton Vance. Under the terms of the merger agreement, Eaton Vance
shareholders will receive $28.25 per
share in cash and 0.5833 shares of Morgan Stanley common stock per
share of Eaton Vance common stock held. The merger agreement
contains an election procedure whereby each Eaton Vance shareholder
may elect to receive the merger consideration all in cash or all in
stock, subject to proration and adjustment.
The merger agreement also provides for Eaton Vance shareholders
to receive a special cash dividend of $4.25 per share of Eaton Vance common stock held.
On November 23, 2020, the Eaton Vance
Board of Directors declared the $4.25
per share special dividend, which was paid on December 18, 2020 to shareholders of record on
December 4, 2020.
Eaton Vance and Morgan Stanley currently expect to complete the
proposed transaction no later than early in the second quarter of
2021. Subject to the satisfaction of customary closing conditions,
including receipt of necessary regulatory approvals and client
consents, the transaction could close as soon as March 1, 2021.
About Eaton Vance Corp.
Eaton Vance Corp. (NYSE: EV) provides advanced investment
strategies and wealth management solutions to forward-thinking
investors around the world. Through principal investment affiliates
Eaton Vance Management, Parametric, Atlanta Capital, Calvert and
Hexavest, the Company offers a diversity of investment approaches,
encompassing bottom-up and top-down fundamental active management,
responsible investing, systematic investing and customized
implementation of client-specified portfolio exposures. As of
January 31, 2021, Eaton Vance had
consolidated assets under management of $584.2 billion. Exemplary service, timely
innovation and attractive returns across market cycles have been
hallmarks of Eaton Vance since 1924. For more information, visit
eatonvance.com.
Forward-Looking Statements
This news release may contain statements that are not historical
facts, referred to as "forward-looking statements." The Company's
actual future results may differ significantly from those stated in
any forward-looking statements, depending on factors such as
changes in securities or financial markets or general economic
conditions, the scope and duration of the COVID-19 pandemic and its
impact on the global economy or capital markets, the completion of
the proposed transaction with Morgan Stanley and the anticipated
terms and timing, including obtaining required regulatory
approvals, anticipated tax treatment, unforeseen liabilities,
future capital expenditures, revenues, expenses, earnings,
synergies, economic performance, indebtedness, financial condition,
losses, future prospects, business and management strategies for
the management, expansion and growth of the combined company's
operations and other conditions to the completion of the
acquisition, client sales and redemption activity, the continuation
of investment advisory, administration, distribution and service
contracts, and other risks discussed in the Company's filings with
the Securities and Exchange Commission.
|
|
|
|
|
|
|
|
Attachment
1
|
|
Consolidated
Statements of Income
|
|
(in thousands,
except per share figures)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
|
|
|
%
|
%
|
|
|
|
|
|
|
|
|
Change
|
Change
|
|
|
|
|
|
|
|
|
Q1
2021
|
Q1
2021
|
|
|
January
31,
|
October
31,
|
January
31,
|
vs.
|
vs.
|
|
|
2021
|
2020
|
2020
|
Q4
2020
|
Q1
2020
|
|
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
Management
fees
|
$
|
430,315
|
$
|
396,268
|
$
|
394,801
|
9
|
%
|
9
|
%
|
|
Distribution and
underwriter fees
|
|
18,211
|
|
18,215
|
|
21,578
|
-
|
|
(16)
|
|
|
Service
fees
|
|
38,598
|
|
34,906
|
|
33,939
|
11
|
|
14
|
|
|
Other
revenue
|
|
1,822
|
|
1,692
|
|
2,236
|
8
|
|
(19)
|
|
|
Total
revenue
|
|
488,946
|
|
451,081
|
|
452,554
|
8
|
|
8
|
|
|
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and
related costs
|
|
221,402
|
|
315,847
|
|
171,982
|
(30)
|
|
29
|
|
|
Distribution
expense
|
|
35,630
|
|
35,436
|
|
40,003
|
1
|
|
(11)
|
|
|
Service fee
expense
|
|
34,218
|
|
30,542
|
|
29,755
|
12
|
|
15
|
|
|
Amortization of
deferred sales commissions
|
|
6,501
|
|
6,400
|
|
5,968
|
2
|
|
9
|
|
|
Fund-related
expenses
|
|
12,125
|
|
10,932
|
|
11,067
|
11
|
|
10
|
|
|
Other
expenses
|
|
99,548
|
|
65,580
|
|
59,060
|
52
|
|
69
|
|
|
Total
expenses
|
|
409,424
|
|
464,737
|
|
317,835
|
(12)
|
|
29
|
|
|
Operating income
(loss)
|
|
79,522
|
|
(13,656)
|
|
134,719
|
NM
|
|
(41)
|
|
|
Non-operating
income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
Gains and other
investment income, net
|
|
23,816
|
|
3,994
|
|
16,090
|
496
|
|
48
|
|
|
Interest
expense
|
|
(5,921)
|
|
(5,800)
|
|
(5,888)
|
2
|
|
1
|
|
|
Other income
(expense) of consolidated
|
|
|
|
|
|
|
|
|
|
|
|
collateralized loan
obligation (CLO) entities:
|
|
|
|
|
|
|
|
|
|
|
|
Gains and
other investment income, net
|
|
41,768
|
|
10,961
|
|
15,563
|
281
|
|
168
|
|
|
Interest and
other expense
|
|
(18,467)
|
|
(16,246)
|
|
(17,396)
|
14
|
|
6
|
|
|
Total non-operating
income (expense)
|
|
41,196
|
|
(7,091)
|
|
8,369
|
NM
|
|
392
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss)
before income taxes and equity
|
|
|
|
|
|
|
|
|
|
|
|
in
net income (loss) of affiliates
|
|
120,718
|
|
(20,747)
|
|
143,088
|
NM
|
|
(16)
|
|
|
Income tax benefit
(expense)
|
|
(9,009)
|
|
7,594
|
|
(32,578)
|
NM
|
|
(72)
|
|
|
Equity in net income
(loss) of affiliates, net of tax
|
|
628
|
|
(20,793)
|
|
2,325
|
NM
|
|
(73)
|
|
|
Net income
(loss)
|
|
112,337
|
|
(33,946)
|
|
112,835
|
NM
|
|
-
|
|
|
Net income
attributable to non-controlling
|
|
|
|
|
|
|
|
|
|
|
|
and
other beneficial interests
|
|
(22,423)
|
|
(1,988)
|
|
(8,850)
|
NM
|
|
153
|
|
|
Net income (loss)
attributable to
|
|
|
|
|
|
|
|
|
|
|
|
Eaton
Vance Corp. shareholders
|
$
|
89,914
|
$
|
(35,934)
|
$
|
103,985
|
NM
|
|
(14)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss)
per share:
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$
|
0.77
|
$
|
(0.32)
|
$
|
0.95
|
NM
|
|
(19)
|
|
|
Diluted
|
$
|
0.74
|
$
|
(0.31)
|
$
|
0.91
|
NM
|
|
(19)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
116,220
|
|
110,701
|
|
109,380
|
5
|
|
6
|
|
|
Diluted
|
|
122,279
|
|
115,878
|
|
114,688
|
6
|
|
7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends declared
per share
|
$
|
4.625
|
$
|
0.375
|
$
|
0.375
|
NM
|
|
NM
|
|
Attachment 2
Non-U.S. GAAP Information and Reconciliations
Management believes that certain non-U.S. GAAP financial
measures, specifically, adjusted operating income, adjusted net
income attributable to Eaton Vance Corp. shareholders and adjusted
earnings per diluted share, while not a substitute for U.S. GAAP
financial measures, may be effective indicators of the Company's
performance over time. Non-U.S. GAAP financial measures should not
be construed to be superior to U.S. GAAP measures. In calculating
these non-U.S. GAAP financial measures, operating income, net
income attributable to Eaton Vance Corp. shareholders and earnings
per diluted share are adjusted to exclude items management deems
non-operating or non-recurring in nature, or otherwise outside the
ordinary course of business. These adjustments may include, when
applicable, the add back of closed-end fund structuring fees, costs
associated with debt repayments and tax settlements, the tax impact
of stock-based compensation shortfalls or windfalls, impairment
charges, costs in connection with the proposed acquisition of Eaton
Vance by Morgan Stanley and other acquisition-related items, and
non-recurring charges for the effect of tax law changes.
Adjustments to operating income also include the add-back of
management fee revenue received from consolidated sponsored funds
and consolidated collateralized loan obligation (CLO) entities
(collectively, consolidated investment entities) that are
eliminated in consolidation and the non-management expenses of
consolidated sponsored funds recognized in consolidation.
Adjustments to net income attributable to Eaton Vance Corp.
shareholders include the after-tax impact of these adjustments to
operating income and the elimination of gains (losses) and other
investment income (expense) of consolidated investment entities and
other seed capital investments included in non-operating income
(expense), as determined net of tax and non-controlling and other
beneficial interests. Management and our Board of Directors, as
well as certain of our outside investors, consider the adjusted
numbers a measure of the Company's underlying operating
performance. Management believes adjusted operating income,
adjusted net income attributable to Eaton Vance Corp. shareholders
and adjusted earnings per diluted share are important indicators of
our operations because they exclude items that may not be
indicative of, or are unrelated to, our core operating results, and
may provide a useful baseline for analyzing trends in our
underlying business.
Effective in the second quarter of fiscal 2020, the Company's
calculation of non-U.S. GAAP financial measures was revised to
reflect the treatment of consolidated investment entities and other
seed capital investments described in the previous paragraph. All
prior period non-U.S. GAAP financial measures have been updated to
reflect this change.
|
Reconciliation of
operating income (loss) to adjusted operating
income:
|
|
(in thousands,
except as noted)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
|
|
|
|
%
|
%
|
|
|
|
|
|
|
|
|
|
Change
|
Change
|
|
|
|
|
|
|
|
|
|
Q1
2021
|
Q1
2021
|
|
January
31,
|
October
31,
|
January
31,
|
|
vs.
|
vs.
|
|
2021
|
2020
|
2020
|
|
Q4
2020
|
Q1
2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
revenue
|
$
|
488,946
|
$
|
451,081
|
$
|
452,554
|
|
8
|
%
|
8
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Management fees of
consolidated sponsored
|
|
|
|
|
|
|
|
|
|
|
|
|
funds and
consolidated CLO entities(1)
|
|
1,971
|
|
1,404
|
|
1,925
|
|
40
|
|
2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted total
revenue
|
$
|
490,917
|
$
|
452,485
|
$
|
454,479
|
|
8
|
|
8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
expenses
|
$
|
409,424
|
$
|
464,737
|
$
|
317,835
|
|
(12)
|
%
|
29
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-management
expenses of consolidated
|
|
|
|
|
|
|
|
|
|
|
|
|
sponsored
funds(2)
|
|
(922)
|
|
(942)
|
|
(1,287)
|
|
(2)
|
|
(28)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accelerated
stock-based compensation expense
|
|
|
|
|
|
|
|
|
|
|
|
|
related to the
proposed acquisition of Eaton Vance
|
|
|
|
|
|
|
|
|
|
|
|
|
by Morgan
Stanley(3)
|
|
(5,702)
|
|
(145,993)
|
|
-
|
|
(96)
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other compensation
expenses related to the proposed
|
|
|
|
|
|
|
|
|
|
|
|
|
acquisition of Eaton
Vance by Morgan Stanley(4)
|
|
(33,943)
|
|
-
|
|
-
|
|
NM
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other costs related
to the proposed acquisition of
|
|
|
|
|
|
|
|
|
|
|
|
|
Eaton Vance by Morgan
Stanley(5)
|
|
(41,398)
|
|
(8,458)
|
|
-
|
|
389
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted total
expenses
|
$
|
327,459
|
$
|
309,344
|
$
|
316,548
|
|
6
|
|
3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
$
|
79,522
|
$
|
(13,656)
|
$
|
134,719
|
|
NM
|
%
|
(41)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Management fees of
consolidated sponsored
|
|
|
|
|
|
|
|
|
|
|
|
|
funds and
consolidated CLO entities(1)
|
|
1,971
|
|
1,404
|
|
1,925
|
|
40
|
|
2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-management
expenses of consolidated
|
|
|
|
|
|
|
|
|
|
|
|
|
sponsored
funds(2)
|
|
922
|
|
942
|
|
1,287
|
|
(2)
|
|
(28)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accelerated
stock-based compensation expense
|
|
|
|
|
|
|
|
|
|
|
|
|
related to the
proposed acquisition of Eaton Vance
|
|
|
|
|
|
|
|
|
|
|
|
|
by Morgan
Stanley(3)
|
|
5,702
|
|
145,993
|
|
-
|
|
(96)
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other compensation
expenses related to the proposed
|
|
|
|
|
|
|
|
|
|
|
|
|
acquisition of Eaton
Vance by Morgan Stanley(4)
|
|
33,943
|
|
-
|
|
-
|
|
NM
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other costs related
to the proposed acquisition of
|
|
|
|
|
|
|
|
|
|
|
|
|
Eaton Vance by Morgan
Stanley(5)
|
|
41,398
|
|
8,458
|
|
-
|
|
389
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted operating
income
|
$
|
163,458
|
$
|
143,141
|
$
|
137,931
|
|
14
|
|
19
|
|
|
Operating
margin
|
|
16.3
|
%
|
(3.0)
|
%
|
29.8
|
%
|
NM
|
|
(45)
|
|
|
Adjusted operating
margin
|
|
33.3
|
%
|
31.6
|
%
|
30.3
|
%
|
5
|
|
10
|
|
|
|
|
|
|
|
|
|
|
|
|
Attachment 2
(continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
income (loss) before income taxes and equity in net income (loss)
of affiliates to adjusted income before income taxes and equity in
net income (loss) of affiliates and income tax expense (benefit) to
adjusted income tax expense:
|
|
(in thousands,
except as noted)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
|
|
|
|
%
|
%
|
|
|
|
|
|
|
|
|
|
Change
|
Change
|
|
|
|
|
|
|
|
|
|
Q1
2021
|
Q1
2021
|
|
January
31,
|
October
31,
|
January
31,
|
|
vs.
|
vs.
|
|
2021
|
2020
|
2020
|
|
Q4
2020
|
Q1
2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss)
before income taxes and equity in net
|
|
|
|
|
|
|
|
|
|
|
|
|
income (loss) of
affiliates
|
$
|
120,718
|
$
|
(20,747)
|
$
|
143,088
|
|
NM
|
%
|
(16)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Management fees of
consolidated sponsored
|
|
|
|
|
|
|
|
|
|
|
|
|
funds and
consolidated CLO entities, pre-tax(1)
|
|
1,971
|
|
1,404
|
|
1,925
|
|
40
|
|
2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-management
expenses of consolidated
|
|
|
|
|
|
|
|
|
|
|
|
|
sponsored funds,
pre-tax(2)
|
|
922
|
|
942
|
|
1,287
|
|
(2)
|
|
(28)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accelerated
stock-based compensation expense
|
|
|
|
|
|
|
|
|
|
|
|
|
related to the
proposed acquisition of Eaton
|
|
|
|
|
|
|
|
|
|
|
|
|
Vance by Morgan
Stanley, pre-tax(3)
|
|
5,702
|
|
145,993
|
|
-
|
|
(96)
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other compensation
expenses related to the
|
|
|
|
|
|
|
|
|
|
|
|
|
proposed acquisition
of Eaton Vance by
|
|
|
|
|
|
|
|
|
|
|
|
|
Morgan Stanley,
pre-tax(4)
|
|
33,943
|
|
-
|
|
-
|
|
NM
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other costs related
to the proposed acquisition of
|
|
|
|
|
|
|
|
|
|
|
|
|
Eaton Vance by Morgan
Stanley, pre-tax(5)
|
|
41,398
|
|
8,458
|
|
-
|
|
389
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net gains and other
investment income related
|
|
|
|
|
|
|
|
|
|
|
|
|
to consolidated
sponsored funds and other
|
|
|
|
|
|
|
|
|
|
|
|
|
seed capital
investments, pre-tax(6)
|
|
(24,298)
|
|
(3,861)
|
|
(13,811)
|
|
529
|
|
76
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other (income)
expense of consolidated CLO
|
|
|
|
|
|
|
|
|
|
|
|
|
entities,
pre-tax(7)
|
|
(23,301)
|
|
5,285
|
|
1,833
|
|
NM
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted income
before income taxes and equity
|
|
|
|
|
|
|
|
|
|
|
|
|
in net income
(loss) of affiliates
|
$
|
157,055
|
$
|
137,474
|
$
|
134,322
|
|
14
|
|
17
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense
(benefit)
|
$
|
9,009
|
$
|
(7,594)
|
$
|
32,578
|
|
NM
|
%
|
(72)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Management fees of
consolidated sponsored
|
|
|
|
|
|
|
|
|
|
|
|
|
funds and
consolidated CLO entities(1)
|
|
505
|
|
359
|
|
497
|
|
41
|
|
2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-management
expenses of consolidated
|
|
|
|
|
|
|
|
|
|
|
|
|
sponsored
funds(2)
|
|
236
|
|
241
|
|
332
|
|
(2)
|
|
(29)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accelerated
stock-based compensation expense
|
|
|
|
|
|
|
|
|
|
|
|
|
related to the
proposed acquisition of Eaton
|
|
|
|
|
|
|
|
|
|
|
|
|
Vance by Morgan
Stanley(3)
|
|
1,461
|
|
37,345
|
|
-
|
|
(96)
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other compensation
expenses related to the
|
|
|
|
|
|
|
|
|
|
|
|
|
proposed acquisition
of Eaton Vance by
|
|
|
|
|
|
|
|
|
|
|
|
|
Morgan
Stanley(4)
|
|
8,700
|
|
-
|
|
-
|
|
NM
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other costs related
to the proposed acquisition of
|
|
|
|
|
|
|
|
|
|
|
|
|
Eaton Vance by Morgan
Stanley(5)
|
|
286
|
|
2,164
|
|
-
|
|
(87)
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net gains and other
investment income related
|
|
|
|
|
|
|
|
|
|
|
|
|
to consolidated
sponsored funds and other
|
|
|
|
|
|
|
|
|
|
|
|
|
seed capital
investments(6)
|
|
(959)
|
|
(722)
|
|
(1,715)
|
|
33
|
|
(44)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other (income)
expense of consolidated CLO
|
|
|
|
|
|
|
|
|
|
|
|
|
entities(7)
|
|
(5,972)
|
|
1,352
|
|
474
|
|
NM
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net excess tax
benefits from stock-based
|
|
|
|
|
|
|
|
|
|
|
|
|
compensation
plans(8)
|
|
27,281
|
|
2,872
|
|
4,860
|
|
850
|
|
461
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted income
tax expense
|
$
|
40,547
|
$
|
36,017
|
$
|
37,026
|
|
13
|
|
10
|
|
|
Effective income
tax rate
|
|
7.5
|
%
|
36.6
|
%
|
22.8
|
%
|
(80)
|
|
(67)
|
|
|
Adjusted effective
income tax rate
|
|
25.8
|
%
|
26.2
|
%
|
27.6
|
%
|
(2)
|
|
(7)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Attachment 2
(continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
net income (loss) attributable to Eaton Vance Corp. shareholders to
adjusted net income attributable to Eaton Vance Corp. shareholders
and earnings (loss) per diluted share to adjusted earnings per
diluted share:
|
|
(in thousands,
except per share figures)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
|
|
|
|
%
|
%
|
|
|
|
|
|
|
|
|
|
Change
|
Change
|
|
|
|
|
|
|
|
|
|
Q1
2021
|
Q1
2021
|
|
January
31,
|
October
31,
|
January
31,
|
|
vs.
|
vs.
|
|
2021
|
2020
|
2020
|
|
Q4
2020
|
Q1
2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
attributable to Eaton Vance
|
|
|
|
|
|
|
|
|
|
|
|
|
Corp.
shareholders
|
$
|
89,914
|
$
|
(35,934)
|
$
|
103,985
|
|
NM
|
%
|
(14)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Management fees of
consolidated sponsored
|
|
|
|
|
|
|
|
|
|
|
|
|
funds and
consolidated CLO entities, net of
tax(1)
|
|
1,466
|
|
1,045
|
|
1,428
|
|
40
|
|
3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-management
expenses of consolidated
|
|
|
|
|
|
|
|
|
|
|
|
|
sponsored funds, net
of tax(2)
|
|
686
|
|
701
|
|
955
|
|
(2)
|
|
(28)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accelerated
stock-based compensation expense
|
|
|
|
|
|
|
|
|
|
|
|
|
related to the
proposed acquisition of Eaton
|
|
|
|
|
|
|
|
|
|
|
|
|
Vance by Morgan
Stanley, net of tax(3)
|
|
4,241
|
|
108,648
|
|
-
|
|
(96)
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other compensation
expenses related to the
|
|
|
|
|
|
|
|
|
|
|
|
|
proposed acquisition
of Eaton Vance by
|
|
|
|
|
|
|
|
|
|
|
|
|
Morgan Stanley, net
of tax(4)
|
|
25,243
|
|
-
|
|
-
|
|
NM
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other costs related
to the proposed acquisition of
|
|
|
|
|
|
|
|
|
|
|
|
|
Eaton Vance by Morgan
Stanley, net of tax(5)
|
|
41,112
|
|
6,294
|
|
-
|
|
553
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net gains and other
investment income
|
|
|
|
|
|
|
|
|
|
|
|
|
related to
consolidated sponsored funds and
|
|
|
|
|
|
|
|
|
|
|
|
|
other seed capital
investments, net of tax(6)
|
|
(2,783)
|
|
(2,100)
|
|
(4,920)
|
|
33
|
|
(43)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other (income)
expense of consolidated CLO
|
|
|
|
|
|
|
|
|
|
|
|
|
entities, net of
tax(7)
|
|
(17,329)
|
|
3,933
|
|
1,359
|
|
NM
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net excess tax
benefit from stock-based(8)
|
|
|
|
|
|
|
|
|
|
|
|
|
compensation
plans
|
|
(27,281)
|
|
(2,872)
|
|
(4,860)
|
|
850
|
|
461
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment
loss(9)
|
|
-
|
|
21,788
|
|
-
|
|
(100)
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net
income attributable to Eaton
|
|
|
|
|
|
|
|
|
|
|
|
|
Vance Corp.
shareholders
|
$
|
115,269
|
$
|
101,503
|
$
|
97,947
|
|
14
|
|
18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss)
per diluted share
|
$
|
0.74
|
$
|
(0.31)
|
$
|
0.91
|
|
NM
|
|
(19)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Management fees of
consolidated sponsored
|
|
|
|
|
|
|
|
|
|
|
|
|
funds and
consolidated CLO entities, net of tax
|
|
0.01
|
|
0.01
|
|
0.01
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-management
expenses of consolidated
|
|
|
|
|
|
|
|
|
|
|
|
|
sponsored funds, net
of tax
|
|
-
|
|
0.01
|
|
0.01
|
|
(100)
|
|
(100)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accelerated
stock-based compensation expense
|
|
|
|
|
|
|
|
|
|
|
|
|
related to the
proposed acquisition of Eaton
|
|
|
|
|
|
|
|
|
|
|
|
|
Vance by Morgan
Stanley, net of tax
|
|
0.03
|
|
0.94
|
|
-
|
|
(97)
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other compensation
expenses related to the
|
|
|
|
|
|
|
|
|
|
|
|
|
proposed acquisition
of Eaton Vance by
|
|
|
|
|
|
|
|
|
|
|
|
|
Morgan Stanley, net
of tax
|
|
0.21
|
|
-
|
|
-
|
|
NM
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other costs related
to the proposed acquisition of
|
|
|
|
|
|
|
|
|
|
|
|
|
Eaton Vance by Morgan
Stanley, net of tax
|
|
0.33
|
|
0.05
|
|
-
|
|
560
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net gains and other
investment income
|
|
|
|
|
|
|
|
|
|
|
|
|
related to
consolidated sponsored funds and
|
|
|
|
|
|
|
|
|
|
|
|
|
other seed capital
investments, net of tax
|
|
(0.02)
|
|
(0.02)
|
|
(0.04)
|
|
-
|
|
(50)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other (income)
expense of consolidated CLO
|
|
|
|
|
|
|
|
|
|
|
|
|
entities, net of
tax
|
|
(0.14)
|
|
0.03
|
|
0.01
|
|
NM
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net excess tax
benefit from stock-based
|
|
|
|
|
|
|
|
|
|
|
|
|
compensation
plans
|
|
(0.22)
|
|
(0.02)
|
|
(0.05)
|
|
NM
|
|
340
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment
loss
|
|
-
|
|
0.19
|
|
-
|
|
(100)
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted earnings
per diluted share
|
$
|
0.94
|
$
|
0.88
|
$
|
0.85
|
|
7
|
|
11
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes to
Reconciliations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Represents management fees eliminated upon the
consolidation of sponsored funds and CLO entities.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2) Represents expenses of consolidated sponsored
funds.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(3) Represents stock-based compensation expense
accelerated pursuant to the terms of the merger agreement with
Morgan Stanley and
associated payroll taxes.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4) Other compensation pertains to bonus payments made
to employees in lieu of the special divided on outstanding and
unvested stock
options and on shares of restricted stock withheld for tax
purposes. Amount includes associated payroll taxes.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(5) Primarily represents proxy solicitation fees and
legal and consulting costs related to the proposed acquisition of
Eaton Vance by
Morgan Stanley.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(6) Represents gains, losses and other investment
income earned on investments in sponsored strategies, whether
accounted for as
consolidated funds, separate accounts or equity investments, as
well as the gains and losses recognized on derivatives used to
hedge
these investments. Stated amounts are net of non-controlling
interests where applicable.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(7) Represents other income and expenses of
consolidated CLO entities.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(8) Represents net excess tax benefits from
stock-based compensation plans. Amounts have been reduced for
executive compensation
limitations under Section 162(m) of the Internal Revenue
Code.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(9) Represents an impairment loss recognized on the
Company's investment in 49 percent-owned affiliate
Hexavest.
|
|
|
|
|
|
|
|
|
Attachment
3
|
|
Components of net
income attributable
|
|
to non-controlling
and other beneficial interests
|
|
(in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
|
|
|
|
%
|
%
|
|
|
|
|
|
|
|
|
|
Change
|
Change
|
|
|
|
|
|
|
|
|
|
Q1
2021
|
Q1
2021
|
|
|
January
31,
|
October
31,
|
January
31,
|
|
vs.
|
vs.
|
|
2021
|
2020
|
2020
|
|
Q4
2020
|
Q1
2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
sponsored funds
|
$
|
20,555
|
$
|
1,040
|
$
|
7,177
|
|
NM
|
%
|
186
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Majority-owned
subsidiaries
|
|
1,868
|
|
948
|
|
1,673
|
|
97
|
|
12
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
attributable to non-controlling
|
|
|
|
|
|
|
|
|
|
|
|
|
and other
beneficial interests
|
$
|
22,423
|
$
|
1,988
|
$
|
8,850
|
|
NM
|
|
153
|
|
|
|
|
|
|
|
Attachment
4
|
|
Consolidated
Balance Sheet
|
|
(in thousands,
except share figures)
|
|
|
|
|
|
January
31,
|
|
|
October
31,
|
|
|
|
2021
|
|
|
2020
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
606,101
|
|
$
|
799,384
|
|
Management fees and
other receivables
|
|
279,858
|
|
|
249,806
|
|
Investments
|
|
558,376
|
|
|
783,246
|
|
Assets of
consolidated CLO entities:
|
|
|
|
|
|
|
Cash
|
|
19,674
|
|
|
91,795
|
|
Bank
loans and other investments
|
|
399,234
|
|
|
2,064,133
|
|
Other
assets
|
|
7,555
|
|
|
28,044
|
|
Deferred sales
commissions
|
|
62,780
|
|
|
60,655
|
|
Deferred income
taxes
|
|
21,215
|
|
|
33,423
|
|
Equipment and
leasehold improvements, net
|
|
72,171
|
|
|
71,830
|
|
Operating lease
right-of-use assets
|
|
248,923
|
|
|
253,109
|
|
Intangible assets,
net
|
|
118,782
|
|
|
120,175
|
|
Goodwill
|
|
259,681
|
|
|
259,681
|
|
Loan to
affiliate
|
|
5,000
|
|
|
5,000
|
|
Other
assets
|
|
140,376
|
|
|
129,017
|
|
Total
assets
|
$
|
2,799,726
|
|
$
|
4,949,298
|
|
|
|
|
|
|
|
|
Liabilities,
Temporary Equity and Permanent Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accrued
compensation
|
$
|
111,577
|
|
$
|
246,129
|
|
Accounts payable and
accrued expenses
|
|
116,403
|
|
|
83,991
|
|
Dividend
payable
|
|
43,977
|
|
|
42,988
|
|
Debt
|
|
621,556
|
|
|
621,348
|
|
Operating lease
liabilities
|
|
296,796
|
|
|
301,419
|
|
Liabilities of
consolidated CLO entities:
|
|
|
|
|
|
|
Senior
and subordinated note obligations
|
|
396,778
|
|
|
1,616,243
|
|
Line of
credit
|
|
-
|
|
|
43,625
|
|
Other
liabilities
|
|
13,058
|
|
|
399,562
|
|
Other
liabilities
|
|
61,045
|
|
|
47,454
|
|
Total
liabilities
|
|
1,661,190
|
|
|
3,402,759
|
|
|
|
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Temporary
Equity:
|
|
|
|
|
|
|
Redeemable
non-controlling interests
|
|
197,842
|
|
|
222,854
|
|
Total
temporary equity
|
|
197,842
|
|
|
222,854
|
|
|
|
|
|
|
|
|
Permanent
Equity:
|
|
|
|
|
|
|
Voting Common Stock,
par value $0.00390625 per share:
|
|
|
|
|
|
|
Authorized, 1,280,000 shares
|
|
|
|
|
|
|
Issued
and outstanding, 464,716 and 464,716 shares,
respectively
|
|
2
|
|
|
2
|
|
Non-Voting Common
Stock, par value $0.00390625 per share:
|
|
|
|
|
|
|
Authorized, 190,720,000 shares
|
|
|
|
|
|
|
Issued
and outstanding, 117,010,114 and 114,196,609 shares,
respectively
|
|
457
|
|
|
446
|
|
Additional paid-in
capital
|
|
285,910
|
|
|
176,461
|
|
Notes receivable from
stock option exercises
|
|
(6,288)
|
|
|
(7,086)
|
|
Accumulated other
comprehensive loss
|
|
(59,448)
|
|
|
(63,276)
|
|
Retained
earnings
|
|
720,061
|
|
|
1,217,138
|
|
Total
permanent equity
|
|
940,694
|
|
|
1,323,685
|
|
Total liabilities,
temporary equity and permanent equity
|
$
|
2,799,726
|
|
$
|
4,949,298
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Attachment
5
|
|
Consolidated
Assets under Management and Net Flows by Investment
Mandate(1)
|
|
(in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
January
31,
|
|
October
31,
|
|
January
31,
|
|
|
|
2021
|
|
2020
|
|
2020
|
|
Equity assets –
beginning of period(2)
|
$
|
135,174
|
|
$
|
133,008
|
|
$
|
131,895
|
|
|
Sales and other
inflows
|
|
7,248
|
|
|
5,904
|
|
|
7,806
|
|
|
Redemptions/outflows
|
|
(7,034)
|
|
|
(7,016)
|
|
|
(6,182)
|
|
|
Net
flows
|
|
214
|
|
|
(1,112)
|
|
|
1,624
|
|
|
Assets
acquired(3)
|
|
-
|
|
|
2,163
|
|
|
-
|
|
|
Exchanges
|
|
90
|
|
|
(101)
|
|
|
3
|
|
|
Market value
change
|
|
17,057
|
|
|
1,216
|
|
|
5,186
|
|
Equity assets
– end of period
|
$
|
152,535
|
|
$
|
135,174
|
|
$
|
138,708
|
|
Fixed income assets –
beginning of period(4)
|
|
73,271
|
|
|
68,955
|
|
|
62,378
|
|
|
Sales and other
inflows
|
|
8,757
|
|
|
8,546
|
|
|
5,086
|
|
|
Redemptions/outflows
|
|
(5,298)
|
|
|
(3,952)
|
|
|
(3,947)
|
|
|
Net
flows
|
|
3,459
|
|
|
4,594
|
|
|
1,139
|
|
|
Assets
acquired(3)
|
|
-
|
|
|
104
|
|
|
-
|
|
|
Exchanges
|
|
21
|
|
|
37
|
|
|
23
|
|
|
Market value
change
|
|
1,889
|
|
|
(419)
|
|
|
722
|
|
Fixed income
assets – end of period
|
$
|
78,640
|
|
$
|
73,271
|
|
$
|
64,262
|
|
Floating-rate income
assets – beginning of period
|
|
28,960
|
|
|
28,569
|
|
|
35,103
|
|
|
Sales and other
inflows
|
|
2,319
|
|
|
1,578
|
|
|
1,689
|
|
|
Redemptions/outflows
|
|
(1,711)
|
|
|
(1,458)
|
|
|
(3,046)
|
|
|
Net
flows
|
|
608
|
|
|
120
|
|
|
(1,357)
|
|
|
Exchanges
|
|
(19)
|
|
|
(22)
|
|
|
(27)
|
|
|
Market value
change
|
|
916
|
|
|
293
|
|
|
117
|
|
Floating-rate
income assets – end of period
|
$
|
30,465
|
|
$
|
28,960
|
|
$
|
33,836
|
|
Alternative assets –
beginning of period(5)
|
|
7,424
|
|
|
7,467
|
|
|
8,372
|
|
|
Sales and other
inflows
|
|
742
|
|
|
470
|
|
|
675
|
|
|
Redemptions/outflows
|
|
(551)
|
|
|
(560)
|
|
|
(593)
|
|
|
Net
flows
|
|
191
|
|
|
(90)
|
|
|
82
|
|
|
Exchanges
|
|
(5)
|
|
|
(1)
|
|
|
-
|
|
|
Market value
change
|
|
91
|
|
|
48
|
|
|
99
|
|
Alternative assets
– end of period
|
$
|
7,701
|
|
$
|
7,424
|
|
$
|
8,553
|
|
Parametric custom
portfolios assets – beginning of
period(6)
|
|
176,435
|
|
|
175,039
|
|
|
164,895
|
|
|
Sales and other
inflows
|
|
12,356
|
|
|
8,680
|
|
|
9,745
|
|
|
Redemptions/outflows
|
|
(9,927)
|
|
|
(7,359)
|
|
|
(6,221)
|
|
|
Net
flows
|
|
2,429
|
|
|
1,321
|
|
|
3,524
|
|
|
Exchanges
|
|
9
|
|
|
86
|
|
|
1
|
|
|
Market value
change
|
|
23,776
|
|
|
(11)
|
|
|
6,898
|
|
Parametric custom
portfolios assets – end of period
|
$
|
202,649
|
|
$
|
176,435
|
|
$
|
175,318
|
|
Parametric overlay
services assets – beginning of period
|
|
94,473
|
|
|
94,350
|
|
|
94,789
|
|
|
Sales and other
inflows
|
|
37,035
|
|
|
21,238
|
|
|
21,313
|
|
|
Redemptions/outflows
|
|
(23,935)
|
|
|
(20,879)
|
|
|
(20,199)
|
|
|
Net
flows
|
|
13,100
|
|
|
359
|
|
|
1,114
|
|
|
Exchanges
|
|
(107)
|
|
|
-
|
|
|
-
|
|
|
Market value
change
|
|
4,745
|
|
|
(236)
|
|
|
1,611
|
|
Parametric overlay
services assets – end of period
|
$
|
112,211
|
|
$
|
94,473
|
|
$
|
97,514
|
|
Total assets under
management – beginning of period
|
|
515,737
|
|
|
507,388
|
|
|
497,432
|
|
|
Sales and other
inflows
|
|
68,457
|
|
|
46,416
|
|
|
46,314
|
|
|
Redemptions/outflows
|
|
(48,456)
|
|
|
(41,224)
|
|
|
(40,188)
|
|
|
Net
flows
|
|
20,001
|
|
|
5,192
|
|
|
6,126
|
|
|
Assets
acquired(3)
|
|
-
|
|
|
2,267
|
|
|
-
|
|
|
Exchanges
|
|
(11)
|
|
|
(1)
|
|
|
-
|
|
|
Market value
change
|
|
48,474
|
|
|
891
|
|
|
14,633
|
|
Total assets under
management – end of period
|
$
|
584,201
|
|
$
|
515,737
|
|
$
|
518,191
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Consolidated Eaton
Vance Corp. See Attachment 11 for directly managed assets and flows
of 49 percent-owned Hexavest, which are not included in the table
above.
|
|
|
|
|
|
|
|
|
|
|
|
|
(2)
|
Includes balanced
and other multi–asset mandates. Excludes equity mandates reported
as Parametric custom portfolios.
|
|
|
|
|
|
|
|
|
|
|
|
|
(3)
|
Represents managed
assets gained in the acquisition of the business assets of WaterOak
Advisors, LLC (WaterOak) on October 16, 2020.
|
|
|
|
|
|
|
|
|
|
|
|
|
(4)
|
Includes cash
management mandates. Excludes benchmark-based fixed income separate
accounts reported as Parametric custom portfolios.
|
|
|
|
|
|
|
|
|
|
|
|
|
(5)
|
Consists of
absolute return and commodity mandates.
|
|
|
|
|
|
|
|
|
|
|
|
|
(6)
|
Equity, fixed
income and multi-asset separate accounts managed by Parametric for
which customization is a primary feature; other Parametric
strategies may also be customized.
|
|
|
|
|
|
|
|
Attachment
6
|
|
Consolidated
Assets under Management and Net Flows by Investment
Vehicle(1)
|
|
(in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
January
31,
|
|
October
31,
|
|
January
31,
|
|
|
|
2021
|
|
2020
|
|
2020
|
|
Funds – beginning of
period
|
$
|
181,420
|
|
$
|
176,215
|
|
$
|
174,068
|
|
|
Sales and other
inflows
|
|
15,435
|
|
|
13,549
|
|
|
11,496
|
|
|
Redemptions/outflows
|
|
(10,828)
|
|
|
(9,283)
|
|
|
(9,161)
|
|
|
Net
flows
|
|
4,607
|
|
|
4,266
|
|
|
2,335
|
|
|
Assets
acquired(2)
|
|
-
|
|
|
237
|
|
|
-
|
|
|
Exchanges
|
|
10
|
|
|
(4)
|
|
|
-
|
|
|
Market value
change
|
|
15,000
|
|
|
706
|
|
|
4,136
|
|
Funds – end
of period
|
$
|
201,037
|
|
$
|
181,420
|
|
$
|
180,539
|
|
Institutional
separate accounts – beginning of period
|
|
163,677
|
|
|
163,818
|
|
|
173,331
|
|
|
Sales and other
inflows
|
|
39,658
|
|
|
25,051
|
|
|
23,605
|
|
|
Redemptions/outflows
|
|
(27,903)
|
|
|
(25,070)
|
|
|
(25,449)
|
|
|
Net
flows
|
|
11,755
|
|
|
(19)
|
|
|
(1,844)
|
|
|
Exchanges
|
|
(29)
|
|
|
63
|
|
|
-
|
|
|
Market value
change
|
|
14,263
|
|
|
(185)
|
|
|
3,771
|
|
Institutional
separate accounts – end of period
|
$
|
189,666
|
|
$
|
163,677
|
|
$
|
175,258
|
|
Individual separate
accounts – beginning of period
|
|
170,640
|
|
|
167,355
|
|
|
150,033
|
|
|
Sales and other
inflows
|
|
13,364
|
|
|
7,816
|
|
|
11,213
|
|
|
Redemptions/outflows
|
|
(9,725)
|
|
|
(6,871)
|
|
|
(5,578)
|
|
|
Net
flows
|
|
3,639
|
|
|
945
|
|
|
5,635
|
|
|
Assets
acquired(2)
|
|
-
|
|
|
2,030
|
|
|
-
|
|
|
Exchanges
|
|
8
|
|
|
(60)
|
|
|
-
|
|
|
Market value
change
|
|
19,211
|
|
|
370
|
|
|
6,726
|
|
Individual
separate accounts – end of period
|
$
|
193,498
|
|
$
|
170,640
|
|
$
|
162,394
|
|
Total assets under
management – beginning of period
|
|
515,737
|
|
|
507,388
|
|
|
497,432
|
|
|
Sales and other
inflows
|
|
68,457
|
|
|
46,416
|
|
|
46,314
|
|
|
Redemptions/outflows
|
|
(48,456)
|
|
|
(41,224)
|
|
|
(40,188)
|
|
|
Net
flows
|
|
20,001
|
|
|
5,192
|
|
|
6,126
|
|
|
Assets
acquired(2)
|
|
-
|
|
|
2,267
|
|
|
-
|
|
|
Exchanges
|
|
(11)
|
|
|
(1)
|
|
|
-
|
|
|
Market value
change
|
|
48,474
|
|
|
891
|
|
|
14,633
|
|
Total assets under
management – end of period
|
$
|
584,201
|
|
$
|
515,737
|
|
$
|
518,191
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Consolidated Eaton
Vance Corp. See Attachment 11 for directly managed assets and flows
of 49 percent–owned Hexavest, which are not included in the table
above.
|
|
|
|
|
|
|
|
|
|
|
|
|
(2)
|
Represents managed
assets gained in the acquisition of the business assets of WaterOak
on October 16, 2020.
|
|
|
|
|
|
|
|
|
|
|
|
|
Attachment
7
|
|
Consolidated
Assets under Management by Investment
Mandate(1)
|
|
(in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
January
31,
|
|
|
October
31,
|
|
%
|
|
|
January
31,
|
|
%
|
|
|
|
|
2021
|
|
|
2020
|
|
Change
|
|
|
2020
|
|
Change
|
|
Equity(2)
|
$
|
152,535
|
|
$
|
135,174
|
|
13%
|
|
$
|
138,708
|
|
10%
|
|
Fixed
income(3)
|
|
78,640
|
|
|
73,271
|
|
7%
|
|
|
64,262
|
|
22%
|
|
Floating-rate
income
|
|
30,465
|
|
|
28,960
|
|
5%
|
|
|
33,836
|
|
-10%
|
|
Alternative(4)
|
|
7,701
|
|
|
7,424
|
|
4%
|
|
|
8,553
|
|
-10%
|
|
Parametric custom
portfolios(5)
|
|
202,649
|
|
|
176,435
|
|
15%
|
|
|
175,318
|
|
16%
|
|
Parametric overlay
services
|
|
112,211
|
|
|
94,473
|
|
19%
|
|
|
97,514
|
|
15%
|
|
Total
|
$
|
584,201
|
|
$
|
515,737
|
|
13%
|
|
$
|
518,191
|
|
13%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Consolidated Eaton
Vance Corp. See Attachment 11 for directly managed assets and flows
of 49 percent–owned Hexavest, which are not included in the table
above.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2)
|
Includes balanced
and other multi–asset mandates. Excludes equity mandates reported
as Parametric custom portfolios.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(3)
|
Includes cash
management mandates. Excludes benchmark-based fixed income separate
accounts reported as Parametric custom portfolios.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4)
|
Consists of
absolute return and commodity mandates.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(5)
|
Equity, fixed
income and multi-asset separate accounts managed by Parametric for
which customization is a primary feature; other Parametric
strategies may also be customized.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Attachment
8
|
|
Consolidated
Assets under Management by Investment
Vehicle(1)
|
|
(in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
January
31,
|
|
|
October
31,
|
|
%
|
|
|
January
31,
|
|
%
|
|
|
|
|
2021
|
|
|
2020
|
|
Change
|
|
|
2020
|
|
Change
|
|
Open-end
funds
|
$
|
120,161
|
|
$
|
108,576
|
|
11%
|
|
$
|
108,290
|
|
11%
|
|
Closed-end
funds
|
|
24,793
|
|
|
23,098
|
|
7%
|
|
|
24,873
|
|
0%
|
|
Private
funds(2)
|
|
56,083
|
|
|
49,746
|
|
13%
|
|
|
47,376
|
|
18%
|
|
Institutional
separate accounts
|
|
189,666
|
|
|
163,677
|
|
16%
|
|
|
175,258
|
|
8%
|
|
Individual separate
accounts
|
|
193,498
|
|
|
170,640
|
|
13%
|
|
|
162,394
|
|
19%
|
|
Total
|
$
|
584,201
|
|
$
|
515,737
|
|
13%
|
|
$
|
518,191
|
|
13%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Consolidated Eaton
Vance Corp. See Attachment 11 for directly managed assets and flows
of 49 percent–owned Hexavest, which are not included in the table
above.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2)
|
Includes privately
offered equity, fixed and floating-rate income, and alternative
funds and CLO entities.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Attachment
9
|
|
Consolidated
Assets under Management by Investment
Affiliate(1)(2)
|
|
(in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
January
31,
|
|
|
October
31,
|
|
%
|
|
|
January
31,
|
|
%
|
|
|
|
|
2021
|
|
|
2020
|
|
Change
|
|
|
2020
|
|
Change
|
|
Eaton Vance
Management(3)(4)
|
$
|
169,278
|
|
$
|
154,394
|
|
10%
|
|
$
|
149,994
|
|
13%
|
|
Parametric
|
|
356,621
|
|
|
310,183
|
|
15%
|
|
|
320,848
|
|
11%
|
|
Atlanta
Capital
|
|
27,698
|
|
|
24,963
|
|
11%
|
|
|
25,552
|
|
8%
|
|
Calvert(5)
|
|
30,604
|
|
|
26,197
|
|
17%
|
|
|
21,797
|
|
40%
|
|
Total
|
$
|
584,201
|
|
$
|
515,737
|
|
13%
|
|
$
|
518,191
|
|
13%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Consolidated Eaton
Vance Corp. See Attachment 11 for directly managed assets and flows
of 49 percent-owned Hexavest, which are not included in the table
above.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2)
|
The Company's
policy for reporting managed assets of investment portfolios
overseen by multiple Eaton Vance affiliates is to base the
classification on the strategy's primary identity.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(3)
|
Includes managed
assets of Eaton Vance-sponsored funds and separate accounts managed
by Hexavest and unaffiliated third-party advisers under Eaton Vance
supervision.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4)
|
Includes managed
assets gained in the acquisition of the business assets of WaterOak
on October 16, 2020.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(5)
|
Includes managed
assets of Calvert Equity Fund, which is sub-advised by Atlanta
Capital, and Calvert-sponsored funds managed by unaffiliated
third-party advisers under Calvert supervision.
|
|
|
|
Attachment
10
|
|
Average Annualized
Management Fee Rates by Investment
Mandate(1)(2)
|
|
(in basis
points on average managed assets)
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
%
|
%
|
|
|
|
|
|
Change
|
Change
|
|
|
|
|
|
Q1
2021
|
Q1
2021
|
|
|
January
31,
|
October
31,
|
January
31,
|
vs.
|
vs.
|
|
|
2021
|
2020
|
2020
|
Q4
2020
|
Q1
2020
|
|
Equity(3)
|
57.3
|
56.4
|
57.0
|
2%
|
1%
|
|
Fixed
income(4)
|
40.2
|
40.4
|
41.4
|
0%
|
-3%
|
|
Floating-rate
income
|
48.9
|
49.1
|
49.9
|
0%
|
-2%
|
|
Alternative(5)
|
68.3
|
70.5
|
64.5
|
-3%
|
6%
|
|
Parametric custom
portfolios(6)
|
16.0
|
15.5
|
15.2
|
3%
|
5%
|
|
Parametric overlay
services
|
4.8
|
5.1
|
4.9
|
-6%
|
-2%
|
|
Total
|
30.4
|
30.5
|
30.8
|
0%
|
-1%
|
|
|
|
|
|
|
|
|
(1)
|
Excludes
performance-based fees, which were $0.2 million in the three months
ended January 31, 2021, $1.5 million in the three months ended
October 31, 2020 and $0.2 million in the three months ended January
31, 2020.
|
|
|
|
|
|
|
|
|
(2)
|
Excludes
management fees earned on consolidated investment entities that are
eliminated in consolidation, which were $2.0 million in the three
months ended January 31, 2021, $1.4 million in the three months
ended October 31, 2020 and $1.9 million in the three months ended
January 31, 2020. The managed assets and flows of consolidated
investment entities are reflected in our consolidated
totals.
|
|
|
|
|
|
|
|
|
(3)
|
Includes balanced
and other multi–asset mandates. Excludes equity mandates reported
as Parametric custom portfolios.
|
|
|
|
|
|
|
|
|
(4)
|
Includes cash
management mandates. Excludes benchmark-based fixed income separate
accounts reported as Parametric custom portfolios.
|
|
|
|
|
|
|
|
|
(5)
|
Consists of
absolute return and commodity mandates.
|
|
|
|
|
|
|
|
|
(6)
|
Equity, fixed
income and multi-asset separate accounts managed by Parametric for
which customization is a primary feature; other Parametric
strategies may also be customized.
|
|
Attachment
11
|
|
Hexavest Inc.
Assets under Management and Net Flows
|
|
(in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
January
31,
|
|
October
31,
|
|
January
31,
|
|
|
|
|
2021
|
|
2020
|
|
2020
|
|
Eaton Vance
distributed:
|
|
|
|
|
|
|
|
|
|
Eaton Vance sponsored
funds – beginning of period(1)
|
$
|
56
|
|
$
|
93
|
|
$
|
152
|
|
|
Sales and other
inflows
|
|
1
|
|
|
1
|
|
|
3
|
|
|
Redemptions/outflows
|
|
(7)
|
|
|
(37)
|
|
|
(26)
|
|
|
Net
flows
|
|
(6)
|
|
|
(36)
|
|
|
(23)
|
|
|
Market value
change
|
|
7
|
|
|
(1)
|
|
|
1
|
|
Eaton Vance
sponsored funds – end of period
|
$
|
57
|
|
$
|
56
|
|
$
|
130
|
|
Eaton Vance
distributed separate accounts –
|
|
|
|
|
|
|
|
|
|
beginning of period(2)
|
$
|
479
|
|
$
|
584
|
|
$
|
1,563
|
|
|
Sales and other
inflows
|
|
-
|
|
|
-
|
|
|
6
|
|
|
Redemptions/outflows
|
|
(265)
|
|
|
(94)
|
|
|
(22)
|
|
|
Net
flows
|
|
(265)
|
|
|
(94)
|
|
|
(16)
|
|
|
Market value
change
|
|
66
|
|
|
(11)
|
|
|
19
|
|
Eaton Vance
distributed separate accounts – end of period
|
$
|
280
|
|
$
|
479
|
|
$
|
1,566
|
|
Total Eaton Vance
distributed – beginning of period
|
$
|
535
|
|
$
|
677
|
|
$
|
1,715
|
|
|
Sales and other
inflows
|
|
1
|
|
|
1
|
|
|
9
|
|
|
Redemptions/outflows
|
|
(272)
|
|
|
(131)
|
|
|
(48)
|
|
|
Net
flows
|
|
(271)
|
|
|
(130)
|
|
|
(39)
|
|
|
Market value
change
|
|
73
|
|
|
(12)
|
|
|
20
|
|
Total Eaton Vance
distributed – end of period
|
$
|
337
|
|
$
|
535
|
|
$
|
1,696
|
|
Hexavest directly
distributed – beginning of period(3)
|
$
|
5,311
|
|
$
|
6,129
|
|
$
|
11,640
|
|
|
Sales and other
inflows
|
|
13
|
|
|
23
|
|
|
96
|
|
|
Redemptions/outflows
|
|
(1,933)
|
|
|
(751)
|
|
|
(554)
|
|
|
Net
flows
|
|
(1,920)
|
|
|
(728)
|
|
|
(458)
|
|
|
Market value
change
|
|
607
|
|
|
(90)
|
|
|
114
|
|
Hexavest directly
distributed – end of period
|
$
|
3,998
|
|
$
|
5,311
|
|
$
|
11,296
|
|
Total Hexavest
managed assets – beginning of period
|
$
|
5,846
|
|
$
|
6,806
|
|
$
|
13,355
|
|
|
Sales and other
inflows
|
|
14
|
|
|
24
|
|
|
105
|
|
|
Redemptions/outflows
|
|
(2,205)
|
|
|
(882)
|
|
|
(602)
|
|
|
Net
flows
|
|
(2,191)
|
|
|
(858)
|
|
|
(497)
|
|
|
Market value
change
|
|
680
|
|
|
(102)
|
|
|
134
|
|
Total Hexavest
managed assets – end of period
|
$
|
4,335
|
|
$
|
5,846
|
|
$
|
12,992
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Managed assets and
flows of Eaton Vance-sponsored funds for which Hexavest is adviser
or sub-adviser. Eaton Vance receives management fees (and in some
cases also distribution fees) on these assets, which are included
in the consolidated assets under management, flows and average
annualized management fee rates reported in Attachments 5 through
10.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2)
|
Managed assets and
flows of Eaton Vance-distributed separate accounts managed by
Hexavest. Eaton Vance receives distribution fees, but not
management fees, on these assets, which are not included in the
consolidated assets under management, flows and average annualized
management fee rates reported in Attachments 5 through
10.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(3)
|
Managed assets and
flows of pre-transaction Hexavest clients and post-transaction
Hexavest clients in Canada. Eaton Vance receives no management fees
or distribution fees on these assets, which are not included in the
consolidated assets under management, flows and average annualized
management fee rates reported in Attachments 5 through
10.
|
View original
content:http://www.prnewswire.com/news-releases/eaton-vance-corp-report-for-the-three-month-period-ended-january-31-2021-301234642.html
SOURCE Eaton Vance Corp.