MutualFundWire.com: T. Rowe's Team Expands

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Friday, July 23, 2010

T. Rowe's Team Expands

T. Rowe Price increased its head count by 60 in the first half of 2010. The Baltimore-based mutual fund firm revealed that expansion -- an increase of 1.25 percent from December 31 -- this morning in its second quarter earnings report. T. Rowe earned $0.59 diluted per common share, up 55 percent year-over-year but $0.02 (over three percent) short of analysts' estimates according to FactSet, MarketWatch reports.

Q2 2010 was a tough quarter in the market, and T. Rowe's mutual funds suffered $19.2 billion in market depreciation, ending with $233.5 billion, accounting for almost 60 percent of T. Rowe's total AUM. Despite the broader market pain, T. Rowe's mutual funds still attracted $3.2 billion in net inflows in Q2, including $1.8 billion into equity funds and $1.4 billion into fixed income and money market offerings. Its mutual fund advisory revenues rose 38 percent from Q2 2009 to $342.8 million. Those mutual fund fees accounted for more than 59 percent of T. Rowe's net income in Q2 2010.

"Despite jittery markets that reduced our assets under management back to year-end 2009 levels, the long-term outlook for T. Rowe Price remains strong," T. Rowe president and CEO James Kennedy stated in the earnings release. "Net inflows across our distribution channels continue to be positive, our balance sheet is very healthy, and we continue to prudently manage the business while investing strategically in key capabilities and attractive growth opportunities."

T. Rowe had 4,862 associates on June 30, 2010, up from 4,802 on December 31. According to Kennedy, the firm invested $68 million in Q1 and Q2 on "facilities and technology equipment," out of $150 million in planned capital investments for 2010.

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