(MENAFNEditorial) PITTSBURGH, April 26, 2018 /PRNewswire/ --Federated Investors, Inc. (NYSE: FII), one of the nation's largest investment managers, today reported earnings per diluted share (EPS) of $0.60 for Q1 2018, up 22 percent from $0.49 for the same quarter last year on net income of $60.3 million for Q1 2018, compared to $49.6 million for Q1 2017.
Federated's total managed assets were $392.2 billion at March31, 2018, up $30.5 billion or 8 percent from $361.7 billion at March31, 2017 and down $5.4 billion or 1 percent from $397.6 billion at Dec.31, 2017. Total average managed assets for Q1 2018 were $398.0 billion, up $34.8 billion or 10 percent from $363.2 billion reported for Q1 2017 and up $16.0 billion or 4 percent from $382.0 billion reported for Q4 2017.
"In the first quarter, Federated saw interest in our MDT strategies, which are quantitatively driven equity portfolios designed to be well-diversified while aiming for high alpha and lower volatility compared to the broader market," saidJ. Christopher Donahue, president and chief executive officer. "In fixed-income, investors sought a variety of investment solutions that ranged from our stalwart Total Return Bond Fund to shorter-duration strategies, in which investments' interest rates can reset as benchmark rates continue to rise."
Federated's board of directors declared a dividend of $0.27 per share, an 8 percent increase from Q4 2017. The dividend is payable on May15, 2018 to shareholders of record as of May8, 2018. During Q1 2018, Federated purchased 118,645 shares of Federated class B common stock for $3.9 million.
Federated's equity assets were $64.0 billion at March31, 2018, down $0.8 billion or 1 percent from $64.8 billion at March31, 2017 and down $4.1 billion or 6 percent from $68.1 billion at Dec.31, 2017. Top-selling equity funds during Q1 2018 on a net basis were Federated MDT Small Cap Core Fund, Federated Kaufmann Small Cap Fund, Federated MDT Small Cap Growth Fund, Federated Muni and Stock Advantage Fund and Federated MDT Mid Cap Growth Fund.
Federated's fixed-income assets were $62.3 billion at March31, 2018, up $10.5 billion or 20 percent from $51.8 billion at March31, 2017 and down $1.9 billion or 3 percent from $64.2 billion at Dec.31, 2017. Top-selling fixed-income funds during Q1 2018 on a net basis included Federated Ultrashort Bond Fund, Federated Total Return Bond Fund, Federated Short-Term Income Fund, Federated Floating Rate Strategic Income Fund and Federated U.S. Government Securities Fund: 1-3 Years.
Money market assets were $265.9 billion at March31, 2018, up $20.7 billion or 8 percent from $245.2 billion at March31, 2017 and up $0.7 billion from $265.2 billion at Dec.31, 2017. Money market fund assets were $182.4 billion at March31, 2018, up $7.2 billion or 4 percent from $175.2 billion at March31, 2017 and down $3.1 billion or 2 percent from $185.5 billion at Dec.31, 2017. Federated's money market separate account assets were $83.5 billion at March31, 2018, up $13.5 billion or 19 percent from $70.0 billion at March31, 2017 and up $3.8 billion or 5 percent from $79.7 billion at Dec.31, 2017.
Financial Summary
Q1 2018 revenues and expenses were impacted by Federated's adoption of the new revenue recognition accounting principle (Topic 606), effective Jan. 1, 2018. The primary impact of adoption is that reimbursements or assumptions of fund-related expenses (Consideration Payable to Customers) are now recorded as a reduction of revenue (investment advisory fees, net). Prior to adoption these amounts were recorded in either distribution expense or other expense. Therefore, there was no change to operating income or net income.
The impact of Consideration Payable to Customers on various components of Federated's Consolidated Statements of Income was as follows for the periods presented:
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