BlackRock Reports Second Quarter 2016 financial results
- AUM of $4.9 trillion, up 4% year-over-year and 3% sequentially
- $2 billion of long-term net inflows in the second quarter of 2016, and $126 billion over the last twelve months, demonstrate strength of diversified business model
- 2% decline in base fees year-over-year, driven by mix shift from equities to fixed income and cash
- 13% growth in Aladdin® revenue from the second quarter of 2015 reflects continued demand for risk management
- 2% decline in diluted EPS (4% as adjusted) year-over-year reflects mix shift and lower performance fees
- Consistent capital management with $275 million of quarterly share repurchases
(1) Net income represents net income attributable to BlackRock, Inc.
(2) See notes (1) through (4) to the Condensed Consolidated Statements of Income and Supplemental Information for more information on as adjusted items and the reconciliation to GAAP.
BlackRock, Inc. (NYSE:BLK) today reported financial results for the three and six months ended June 30, 2016.
“Our clients are facing unprecedented challenges as they attempt to navigate the current investment environment,” said Chairman and Chief Executive Officer Laurence D. Fink. “Political and macroeconomic uncertainty, historically low yields and elevated market volatility are leading clients to pause, as evidenced by more than $55 trillion in bank deposits in the US,China and Japan alone.
“BlackRock generated $2 billion of long-term net flows in the quarter and $126 billion of inflows over the last twelve months, despite the impact of market headwinds and a slowdown in client activity. Beta and mix shift favored fixed income and cash relative to equities, and impacted second quarter base fees year-over-year.
“This market environment is creating greater opportunities for BlackRock to engage with clients – leading to more frequent and substantive conversations than ever before. Clients are seeking advice, goal-oriented investment solutions and risk management and technological expertise. The differentiated platform we have purposely built at BlackRock is resonating with clients. Our combination of active, index and alternative investment capabilities, powered by Aladdin’s industry-leading technology and risk management, positions us well to capture flows when client activity accelerates.
“We are seeing increasing evidence that our recent strategic investments are driving growth. iShares generated $16 billion of net new business during the quarter, with significant strength in fixed income and ‘smart-beta’ ETFs, as clients utilize these tools to manage risk and minimize volatility. We saw another strong quarter of capital raising in infrastructure, bringing total invested and committed capital to $8 billion, providing clients access to attractive long-term returns and stimulating needed economic growth. Finally, Aladdin revenue grew 13% year-over-year. The increasing impact of technology on our industry continues to drive demand, as we signed one of our largest ever institutional clients during the quarter, and we remain focused on meeting the growing need for technology solutions in the retail sector.
“Now more than ever, BlackRock is uniquely positioned to provide innovative solutions to our clients’ complex investment and technology needs. Our focus remains on investing for the future so BlackRock can help clients meet their financial goals and deliver long-term value for shareholders.”
Source: Blackrock
