Alliancebernstein Holding L.p. · NYSE:AB
Alliancebernstein Holding L.p — Alliance Capital Management Holding — Q4 2004 Earnings Presentation
45 slides from Alliancebernstein Holding L.p's earnings presentation, Jan 28, 2005
Slide 1: Fourth Quarter 2004 Review
‘wwrw-alliancecapital.comn AllianceCapital AS January 27, 2005 FOURTH QUARTER 2004 REVIEW Gerald M. Lieberman President & Chief Operating Officer ‘There no guarartee that any fercatsor pon inti material be ealce. éomaton shoul nat be corerund as ivesrent ace,
Slide 2: Introduction and Forward-Looking Statements
Introduction ‘The SEC adopted Regulation FD in October 2000. In light of Regulation FD, Management wil be limited in responding to Inquiries from investors or analysts in a non-public forum such as this one, Forward-Looking Statements Certain statements provided by Alliance Capital and Alliance Hold
Slide 3: 2004 Market Performance
2004 Market Performance Fourth Quarter Tailwind 25% 20% 15% 10% 5% 0% 8% Deans 9 months 202% 185% 147% 10.9% 63% 43% S8P500 - MSCIEAFE © MSCIWORLD Russel1000 Russel'1000 Lehman Growth Vale Aggregate Bond AllianceCapital AX.
Slide 4: Alliance Capital Relative Investment Performance
Alliance Capital Relative Investment Performance m Overall, both U.S. and non-US. relative equity returns were strong for the year ® Across the board, competitive one-year performance numbers in Growth services > Strong performance in Large-Cap Growth, Dynamic Growth, Mid-Cap Growth, Small Cap Growt
Slide 5: Alliance Capital Fourth Quarter Revenues
Alliance Capital Fourth Quarter Revenues (de altos. eet AUD 4Q04 4Q03 % chg Comments Ending AUM ($bn) $539 $477 129% Average AUM ($bn) S502 $458, 11.9% | Maretenpectin ant Revenues Advisory Fees $593 $547 8.3% Distribution 110 1538 Institutional Research Sves. 79 69148 Other 4 _38 143 Total $926 «$7
Slide 6: Alliance Capital Fourth Quarter Advisory Fees
Alliance Capital Fourth Quarter Advisory Fees (de altos. eet ALD 40044003 % ch Comments Advisory Fees + Higher averoge AUM, party ost Base Fees $489 $460 6.1% be pole er giro cpenvend mtual urs Transaction Charges 26 80 HOT reemengvenne Performance Fees 78 57 36.4 Hher nedge tnd fees tom strong —_—_
Slide 7: Alliance Capital Fourth Quarter Revenues
Alliance Capital Fourth Quarter Revenues (de altos. eet ALD 4004 4Q03 % chg Ending AUM ($bn) $539 $477 12.9% Average AUM ($bn) $502, $458 11.0% Revenues Advisory Fees $593 $547 8.3% Distribution 110 1538 Institutional Research Sves. 79 69145 Other 44 _38 143 Total $926 «$769 74% NOTE: Percertages ar
Slide 8: Alliance Capital Fourth Quarter Net Distribution Activity
Alliance Capital Fourth Quarter Net Distribution Activity (de altos. eet ALD 4g04 4003 % ch Comments Distribution Revenues $110 $115 -3.8% + Distrbuion Reverues ‘ioniicrty offet by Distribution Expenses Dletrnaon Pin Payments Distribution Plan Payments 93 95 a4 Amort of Def Sales Comm. 38 51 BBA Coi
Slide 9: Alliance Capital Fourth Quarter Revenues
Alliance Capital Fourth Quarter Revenues (de altos. eet ALD 4004 4Q03 % chg Comments Ending AUM (Sbn) $539 __ga77, 12.9% Average AUM ($bn) $502 S45R 119% Revenues Advisory Fees $593 $547 83% Distribution 110 115 -38 Institutional Research Svcs. 79 69 14.5] * Pacherenniitishirtead Other 44 __ 38 143
Slide 10: Alliance Capital Fourth Quarter Other Revenues
Alliance Capital Fourth Quarter Other Revenues (de Salto. eet AUD 4Q04 4Q03 % chg Comments Other Revenues: Shareholder Servicing Fees $ 19 Investment Gains & Losses 8 Dividend & Interest, net B Other, net 4 Total $44 NOTE: Prcertages ar cabled nig andehig anbere $21 6.2% 158 wm -39.0 6 5 _ 6 $38 143
Slide 11: Alliance Capital Fourth Quarter Expenses & Net Income
Alliance Capital Fourth Quarter Expenses & Net Income 10 ose 4004 4Q03 % chg Employee Comp. & Benefits $288 $270 6.6% Promotion & Servicing 174 191 92 General & Administrative 109 95 155 Interest 5 “198 Amortization of Intangibles 5 = 581 24 Charge for Mutual Fund Matters and Legal Proceedings z ~10
Slide 12: Alliance Capital Fourth Quarter Compensation & Benefits
Alliance Capital Fourth Quarter Compensation & Benefits (@e$.itoes) 4904 4Q03% chg Comments Base Compensation $84 $79 6.7% ia ereanesi hence Incentive Compensation 123 120 26 Commissions 59 50 17.0 * petialan annie elbel mpeg Insttutional Investment Management Fringes & Other 22 21 38 Total $288 $27
Slide 13: Alliance Capital Fourth Quarter Expenses & Net Income
Alliance Capital Fourth Quarter Expenses & Net Income Sains) 4904 4903 % chg Comments Employee Comp.& Benefits $288 $270 6.6% Promotion & Servicing 174 191 92 » Rawrer Dec semstecme [General & Administrative 108 95 155 Interest 5 198 Amortization of Intangibles 5 - 581 24 Charge for Mutual Fund Matt
Slide 14: Alliance Capital Fourth Quarter G&A Expenses
13 Alliance Capital Fourth Quarter G&A Expenses (eo $aione) 4904 4Q03. % chg Comments General & Administrative + Higher ret fr new space en Office & Related $47 $38 24.9% iti re foes ead, Technology 29 25 165 + Software wre dove Professional Fees 12 15 -204 Ee aN EROS Portfolio Services 1 9 30.1 ‘+
Slide 15: Alliance Holding Financial Results
4 Alliance Holding Financial Results (de $itors, eet pend Anouts) 4Q04 = 4Q03 % chg 3Q04 -% che Equity in Earnings $73 $ 16 nin $ 48 53.2% Income Taxes —L = 8 97 —6 150 Net income $66 $ 10 nim $42 586 Additional EquityinEarnings 1 = nvm a Net Income - Diluted S 6 $ 10 nim $42 594 Diluted Net Income
Slide 16: Growth in Non-U.S. Assets
Growth in Non-U.S. Assets ‘$598 Billion at $477 Billion at December31, 2004 December31, 2003 8 sien « Non-US, Non-U. us We By Client Domicile Non-US. Non-U. ‘008m cangetna byoU by Gem oe ZONE 18
Slide 17: Assets Under Management by Investment Orientation
16 Assets Under Management by Investment Orientation as of December 31, 2004 SERVICE + Value Equity + Fixed Income + Growth Equity TOTAL AUM $193 193 123 + Index / Structured Value Component Blend ‘Components $52 $27 Equity $98 ‘ruth Comporert of Bien
Slide 18: Changes in Assets Under Management by Investment Orientation
v Changes in Assets Under Management by Investment Orientation Three Months Ended December 31,2004 in$ milions) Value Growth Fixed Equity Equity Income Passive Total Beginning of Period $167,485 $113408 $181,009 7,12 Sa Long Term ows SalesNew accounts 702 = 4884 12,200 1% 24312 Redernptions/Terrinat
Slide 19: Changes in Assets Under Management by Investment Orientation
Changes In Assets Under Management By Investment 18 Orientation Twelve Months Ended December 31, 2004 in$ milions) Value Growth Fixed Equity Equity Income Passive Total Beginning of Period SHA7768 $124301 | SH7BBI4 RAM «$077267 Long Term Flows Sales New accounts 25308 16736 «(24.480 8086738 Redempti
Slide 20: Institutional Investment Management — Fourth Quarter Highlights
Institutional Investment Management — Fourth Quarter Highlights = New net Fixed Income flows of nearly $7 billion from AXA affiliates Continued strong inflows into Global & Blend Services offset by continued attrition in U.S. Growth Equity services {in $ bitions) Beginning AUM Net Long-Term Flows Ap
Slide 21: Retail Asset Management — Fourth Quarter Highlights
Retail Asset Management — Fourth Quarter Highlights Ended December 31, 2004 New leadership team in place fio $ bilfons) SMontie; 12 Months Market share in U.S. Retail funds Bepinnlieg 4M 09 a6 remains depressed isc ira f 4 Regent SMA sales strong Cash Management, Net 0 2 Launched Wealth Strategies A
Slide 22: Private Client Asset Management — Fourth Quarter Highlights
Private Client Asset Management — Fourth Quarter Highlights Net flows slowed to $452 milion ernided Decemeber St 200e due to increased attrition eros) Ween (in $ bilions) = Expansion continues enn a e ‘¢ Financial Advisors total 193 Net Long-Term Flows 0 5 (+17%) Appreciation 5 6 3new offices opened
Slide 23: Institutional Research Services — Fourth Quarter Highlights
Institutional Research Services — Fourth Quarter Highlights = Double-digit revenue growth e Increased market share and market volume more than offset lower pricing in USS. and London’ m= Arecord year in revenues Sanford C. Bernstein remains a leader for quality research in major investor polls
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Slide 25: Market Environment
Market Environment 4 S&P 500 MSCI EAFE MSCI WORLD Russell 1000 Growth Russell 1000 Value Lehman Aggregate Bond Fetus troup cenber $2, 2008 Annualized Cumulative 4Q04 aYr 3Yr 3Yr 9.2% 10.9% 36% 11.2% 15.3% 20.2% 11.9% 40.1% 1% 14.7% 70% 22.39% 92% 6.3% 02% 05% 10.4% 165% 86% 28.0% 10% 43% 62% 19.8%
Slide 26: Relative Performance — Institutional Value Equity (Before Fees)
Relative Performance — Institutional Value Equity (Before Fees) () Institutional Equity Composites vs. Benchmarks us. us. Bernstein Emerging Strategic Diversified International Global Markets Value?) Value?) Value Values) Value’) 4004 09 07 02 +04 w 24 A +66 +52 144 a 07 13 +88 +67 +165 an +38 42 +9
Slide 27: Relative Performance — Institutional Growth Equity (Before Fees)
Relative Performance — Institutional Growth Equity (Before Fees) 10 Institutional Equity Composites vs. Benchmarks Global Emerging Large Cap Dynamic = Mid Cap_— SmallCap —IntiLgCap Research Market Growth® _Growth®) Growth Growth®) Growth) Growth) Growth?) 106 33 +54 06 06 or +40 15 +94 +45 16 45 00
Slide 28: Relative Performance — Institutional Fixed Income (Before Fees)
Relative Performance — Institutional Fixed Income (Before Fees) Institutional Fixed income Composites vs. Benchmarks Core Corp High Emerging Core Plus®) Mortgage®) Bonds” ——_Yield®) Global) Market”) 400s +04 oA 02 vot +07 +06 tw 108 +08 +07 20 10 “04 a Ot ma +07 34 +08 47 oy oo +07 107 13 +04 +52 to
Slide 29: Relative Performance — Institutional Value Equity (After Fees)
Relative Performance — Institutional Value Equity (After Fees) Institutional Equity Composites vs. Benchmarks us. us. Bernstein Emerging Strategic Diversified International Global Markets Value?) Value?) Value Values) Values) 4004 10 08 05 +04 175 w 29 19 +56 +42 124 a AA +08 +78 +58 148 an +34 +38
Slide 30: Relative Performance — Institutional Growth Equity (After Fees)
Relative Performance — Institutional Growth Equity (After Fees) ( Institutional Equity Composites vs. Benchmarks Global Emerging Large Cap Dynamic = Mid Cap_— SmallCap —IntiLgCap Research Market Growthi?) Growth®) Growth (4 = Growthi?) Growth’) Growth®) Growth?) soos +05 +32 +63 08 07 09 +09 tyr 412
Slide 31: Relative Performance — Institutional Fixed Income (After Fees)
Relative Performance — Institutional Fixed Income (After Fees) Institutional Fixed income Composites vs. Benchmarks Core Corp High Emerging Core Plus®) Mortgage®) Bonds” ——_Yield®) Global) Market”) 4008 +03 02 02 00 +08 +04 tw 402 +03 +05 23 +08 07 a 03 +08 +08 37 +03 +39 se 02 +04 +08 47 oA 4a tor
Slide 32: Relative Performance — Retail Value Equity (After Fees)
Relative Performance — Retail Value Equity (After Fees) Retail Mutual Funds vs. Lipper Averages ‘Small Large Cap Growth&® Cap Intl Global Value)” Income) Value” Value). «== Yalue(*). Balanced” soos +02 03 07 42 08 oo we 44 00 02 +29 +0.9 42.2 an 935 20 +33 +54 +03 122 on +05 “47 109 423 124 NOTE: Th
Slide 33: Relative Performance — Retail Growth Equity (After Fees)
Relative Performance — Retail Growth Equity (After Fees) (") 1090 Retail Mutual Funds vs. Lipper Averages Global | Regent Large Cap Growth MidCap SmallCap Growth _| Core Growth?) Multi Cap®) Growth) Growth) Research®)’ Equity”) +04 +05 “04 02 10 +08 +0 43 +04 133 0s +08 30 +418 +88 +09 +50 34 10.4 c
Slide 34: Relative Performance — Retail Fixed Income (After Fees)
Relative Performance — Retail Fixed Income (After Fees) Retail Fixed Income Funds vs. Lipper Averages Bernstein _ ACMGI- Corporate Americas Gov't Emerging High Short American Bond?) Income?) Market Debt®) Yield“) Duration Plus‘) Income - 0S”) soos +42 27 08 +04 09 18 ™ +30 418 13 42 oA 128 an +03 on
Slide 35: Absolute Performance — Private Client (After Fees)
Absolute Performance — Private Client (After Fees) ( 4go4 1 Yr 3Yr S¥r All Balanced Accounts +73 +99 +72 +6.1 Global Balanced Benchmark® +69 493 +63 +16 NOTE: The inemation nti abe is provided soley we in connrton wth this precenaion,andis nt deeaedtouardseitng erptet invesmenaaveoy cas pane Caps ee
Slide 36: Fourth Quarter Revenues — by Distribution Channel
Fourth Quarter Revenues — by Distribution Channel iad 4Q04 4003 % chg Institutional Inv. Mgmt $207 $184 12.7% Retail 311 332 “64 Private Client 204 166 22.8 Institutional Research Svcs. 79 69 145 Other 2% _1% 385 Total $826 __ $769 TA
Slide 37: Annualized Fee Base
Annualized Fee Base By Channel and Investment Orientation 12181104 vs. 1218103 in$ mitions) $2,133 mm — $1,959 mm 1214 120003 sews 120108 tains 4261108 nettitooat ma Private Chent ‘Management mGrowth mYalue (1) eusloed Foe Sas eve a5 pofodend AiMtivescotratua anruaee ates; Brita income GPassive Some
Slide 38: Trends in Headcount
Trends in Headcount 4,950 4450 4350 4250 4150 4,050 3,950
Slide 39: Alliance Capital (The Operating Partnership) Consolidated Balance Sheet
Alliance Capital (The Operating Partnership) Consolidated Balance Sheet Gn $ thousands, Unauettecy 12308 125108 Assets ‘Cash and investments $1,253690 $ 624729 Cash and securities, segregated 1489041 1285801 Receivables, net 2,194,226 2290075 Goodwill, net 2876657 2 B76 657 Intangible assets, net 32
Slide 40: Alliance Capital (The Operating Partnership) Consolidated Cash Flow
Alliance Capital (The Operating Partnership) Consolidated Cash Flow in thousands, Unauettec) seat 04 1213103 Cash Flows From Operating Activities: Netincome 3 710,50 3 329,808 Non-cash tems ‘Amortization and depreciation: “Amortization of deterred sales commissions 17,355 208,565 ‘Amortization of de
Slide 41: FIN Impact
FIN 46 IMPACT «0 (de Sins, vue) PreFIN46 FING Effect Consolidated Revenues Base Fee 3582 o $593 Distribution 110 110 Performance Fee 73 B 7 other Investment Gains & Losses 14 © 8 Dividend & interest, net 10 3 13 ther 23 2 28 2) 226 Expenses Employee Comp & Benefts 268 : 288 Promotion 8 Servicing 174
Slide 42: Changes in Assets Under Management by Channel
Changes in Assets Under Management by Channel ‘Three Months Ended December 31,2004 in$miions) Institutional Private InvMgmt Retail __Client_—Total Beginning of Period $277,539 $152,855 $59,065 $489,459 Long-Term Flows SaegNew accounts 1821 6.248 1823 4312 Redernptions/Terminetions (4841) 6,950) (1,0
Slide 43: Changes in Assets Under Management by Channel
Changes In Assets Under Management By Channel Twelve Months Ended December 31, 2004 (in $ millions) Institutional Private InvMgmt Retail, Client_—_—_—‘Total Beginning of Period $267,796 $155,878 $83,593 $477,267 Long Term Flows Sales!New accounts 35524 23,435, 8,432 67,291 Redernptions/Terminations
Slide 44: Reclassification Summary of Assets Under Management
Reclassification Summary of Assets Under Management as of 12/31/2004 Correa Wetecsegy Previous Wetogaieay CD Dierence runaors) fun fie Tosh patins! abt te Tesh mses Set se Paineseimant ont rane tasty vate tu, ueainsome Bias Fase Sos Gur Haase Hui Sxser S320 2209) ‘Summary of Recasstcatens ofa mare o
Slide 45: Searchable text section of graphics shown above
Searchable text section of graphics shown above [ GRA PHIC] [LOGO] www.alliancecapital.com January 27, 2005 FOURTH QUARTER 2004 REVIEW Gerald M. Lieberman President & Chief Operating Officer There is no guarantee that any forecasts or opinions in this material will be realized. Information should no
Alliance Capital Management Holding — Q4 2004 Earnings Presentation on 6ix