Alliancebernstein Holding L.p. · NYSE:AB
Alliancebernstein Holding L.p — Q1 2012 Earnings Presentation
36 slides from Alliancebernstein Holding L.p's earnings presentation, May 3, 2012
Slide 1: First Quarter 2012 Review
May 2, 2012 First Quarter 2012 Review Peter S. Kraus Chairman & Chief Executive Officer Edward J. Farrell Controller & Interim Chief Financial Officer ALLIANCEBERNSTEIN
Slide 2: Cautions Regarding Forward-Looking Statements
Cautions Regarding Forward-Looking Statements Certain statements provided by management in this presentation are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks, uncertainties, and other fac
Slide 3: Peter S. Kraus
Peter S. Kraus Chairman & Chief Executive Officer
Slide 4: Firmwide Overview: First Quarter
Firmwide Overview: First Quart In US $ Billions $18 sis $18 $16 les 10:12 4:11 10:12 10:11 10:12 40:11 10:12 10:11 $(12) 5(13) $(12) (14) $477 $419 $406 $419 End of Period AUM 10:12 4:11 10:12 19:11 $481 S417 $411 S417 Average AUM 10:12 4:11 10:12 10:11
Slide 5: Asset Flows by Distribution Channel: Quarterly Trend
Asset Flows by Distribution Channel: Quarterly Trend In US $ Billions = Gross Sales = Gross Redemptions Net Flows: 12.9 8.5 61 5.2 a7 6 38 (0.8) Fe ia sa 0) (4.1) ape (37) (72) ie 2) 29) (9.0) (12.9)} » (10.5) (143) (11.7) (10.9) (106) (14.0) (16.7) (18.1) (18.6) ea Inst Ret PC Inst Ret PC, Inst Ret
Slide 6: Institutional Highlights
Institutional Highlights 1Q12 Gross Sales by Asset Class AXA-Related Dispositions Have Increased Outflows $3.8B in Total Value Fixed Income Growth Other Higher Pipeline** in 1Q12... ($14.0) $B L ($11.3) ; ($5.2) 618.1) 18.6) (816.7) 4011 2011 3011 4ait 1012 Outflows Related to AXA Dispositions ...Dr
Slide 7: Relative Performance: 1st Quarter 2012
Relative Performance: 1° Quarter 2012 Through 3/31/12 Fixed Income: 1Q12 1 Year 3 Year 5 Year US Strategic Core Plus 0.3 (1.0) 48 06 US High Yield Composite 0.6 (1.2) 2.2 0.4 Global High Income 0.1 0.7 44 0.2 Global Fixed Income 0.2 5.3 3.4 2.0 Diversified Yield 3.0 2.9 10.6 1.0 Emerging Markets Deb
Slide 8: Retail Highlights
Retail Highlights 1Q12 Gross Sales by Asset Class All Regions Contributed to Sequential Gross Sales Growth $12.9B in Total Fixed Income +150% +109% +86% ¥ +73% 81% +30% Japan Asiaex- Latin EMEA US —_—_Total Japan America New Products Gathering Assets Strong Gross Sales of Both New and Long-Term Offe
Slide 9: Private Client Highlights
Private Client Highlights Stability and Strength The Bernstein Advantage 1012/4Q11 % Change = Integrated Solutions With insight into every position in every 5% client's portfolio, we can employ integrated risk management aR (DAA), tax-aware trading and systematic rebalancing by account = Custom Plan
Slide 10: Bernstein Research Services Highlights
Bernstein Research Services Highlights Sequential Increase in Revenues... Rapid Growth of SCB Hong Kong SM % Change 1012111: (11)% 1012/4011: 16% 119 106 LJ 1011 4ait 1012 200 Revenue CAGR 41010-1012: +480% 2 150 & S 100 3 = 1 # Clients CAGR 50 4Q10~ 1012: +224% o 1Q10 2010 3Q10 4Q10 111 2011 3011 4
Slide 11: Progress on Our Strategy in 2012
Progress on Our Strategy in 2012 Firmwide Initiative Progress Improve investment performance and deliver for clients Diversify our business across channels, investment services and geographies Equity actions support long-standing services while evolving product set to meet client needs Improved perf
Slide 12: Edward J. Farrell
Edward J. Farrell Controller & Interim Chief Financial Officer B "
Slide 13: Financial Highlights: First Quarter
Financial Highlights: First Quarter In US $ Millions $659 $562 $528 $562 10:12 40:11 10:12 10:11 ‘es ‘$e sai $515, 10:12 40:11 10:12 10:11 21.9% 18.0% 18.0% Adjusted Operating Margins 7.0% 10:12 40:11 10:12 10:11 aig 20¢ 29¢ “0 a a 7¢ = 10:12 40:11 10:12 10:11 Please refer to pages 32-94 for additon
Slide 14: First Quarter 2012 Income Statement
First Quarter 2012 Income Statement m= Sequential variances affected by $587 million deferred compensation charge recorded in 4Q11 ® Versus the prior year period, decline in net revenues outpaced expense reductions lm Adjusted EPU of 29 cents for 1Q12; distribution of 26 cents 1Q 4Q 1Q In US Dollar
Slide 15: First Quarter 2012 Revenues
First Quarter 2012 Revenues ™ Base fee variances from both prior periods in line with changes in average AUM and asset mix ® Bernstein Research revenues improved sequentially, due primarily to higher trading activity, and the decline from the prior year quarter is attributed primarily to lower volum
Slide 16: First Quarter 2012 Operating Expenses
First Quarter 2012 Operating Expenses ®™ Sequential increase in Base Comp due to severance associated with first quarter headcount reductions = Promotion & Servicing expenses increased sequentially due to higher distribution payments, partially offset by lower T&E, and essentially flat versus the pr
Slide 17: First Quarter 2012 GAAP to Adjusted Reconciliation
First Quarter 2012 GAAP to Adjusted Reconciliation m Adjusted Operating Income increased sequentially as revenues improved and expenses were reduced = In 4Q11 we trued up compensation to meet our full year target m= Adjusted Operating margin sequential improvement, but decline versus the prior year
Slide 18: AllianceBernstein.com
AllianceBernstein.com
Slide 19: AllianceBernstein.com
AllianceBernstein.com
Slide 20: Institutional Equity: Relative Performance
Institutional Equity: Relative Performance Institutional Equity Composites vs. Benchmarks Periods Ended March 31, 2012 1Q One — Three Five Ten Service 2012 Year _Years ‘Years _‘Years Benchmark Value Global Value 08 (10.0) (4.1) (66) (1.1) MSCIWorld (Cap, UH, net) Intemational Value 1.0 (63) (3.2) (4
Slide 21: Institutional Fixed Income: Relative Performance
Institutional Fixed Income: Relative Performance Institutional Fixed Income Composites vs. Benchmarks* Periods Ended March 31, 2012 1Q One Three Five Ten Service 2012 Year _—‘Years ‘Years _‘Years Benchmark : 33% Barclays High Yield, 33% JPM EMBI Global High Income (03) (1.4) 78 04 13 Gis Gat JE CHEM
Slide 22: Retail Equity: Relative Performance
Retail Equity: Relative Performance Retail Mutual Funds vs. Lipper Averages Periods Ended March 31, 2012 1Q One Three Five —‘ Ten Service 2012 Year _Years Years _Years Lipper Average Value Intemational Value 22 (37) (1.6) (4.5) (1.0) Intemational Large Cap Value Growth & income 04 4A 04 (13) (08) La
Slide 23: Retail Fixed Income: Relative Performance
Retail Fixed Income: Relative Performance Retail Fixed Income Funds vs. ipper Averages Periods Ended March 31, 2012 1Q One Three — Five Ten Service 2012 Year Years Years Years Lipper Average Global High Yield Portfolio (1.3) 28 5.0 18 09 Bond Global High Yield American Income Portfolio 05 05 7.3 14
Slide 24: Private Client: Absolute Performance
Private Client: Absolute Performance Periods Ended March 31, 2012 1Q One Three Five Ten Service 2012 Year Years Years Years Fully Diversified Simulation* 8.0 16 13.4 (0.0) 44 S&P 500 126 85 23.4 20 44 MSCI World Index - Net 11.5 06 20.2 (0.7) 47 Lipper Short/int Blended Muni Fund Avg 08 67 49 37 36
Slide 25: Assets Under Management
Assets Under Management $ Billions At March 31, 2012 At Dec 31 At Mar 31 2011 2011 Private Institutions Retail Client Total Total Total Equity Value $ 44 $ 18 $ 20 $ 82 $ 81 $ 137 Growth 9 20 15 44 44 71 Total Equity 53 38 35 126 125 208 Fixed Income 132 58 34 224 218 210 Other 37 28 4. — 68. 63_ 59
Slide 26: Three Months Ended 3/31/12: AUM Roll-Forward by Distribution Channel
Three Months Ended 3/31/12: AUM Roll-Forward by Distribution Channel In US $ Billions Institutions Retail Private Client Total US Global Total US _Global_—‘Total US __Global_‘Total_ US __Gllobal_Total Beginning of Period $110.7 $113.2 $223.9 | $43.2 $69.4 $112.6 | $50.1 $19.3 $69.4 | $204.0 $201.9 $
Slide 27: Three Months Ended 3/31/12: AUM Roll-Forward by Investment Service
Three Months Ended 3/31/12: AUM Roll-Forward by Investment Service In US $ Billions Value Equity Growth Equity Fixed Income Other!” Total US Global Total US Global Total US __Global_‘Total__US__Global_Total US __Global_Total Beginning of Period $252 $556 © $80.8 | $21.8 $224 $442 | $127.4 $90.2 $217
Slide 28: AUM by Region
AUM by Region As of March 31, 2012 Institutions Other 10% Eur. ex-UK 5% Australia 3% UK 5% N.A. ex- US 5% US $ Billions $222.3 Retail of Europe 7% ther 3% $124.2 a
Slide 29: First Quarter 2012 Advisory Fees
First Quarter 2012 Advisory Fees In US Dollars 1Q 4Q 10 2012 2011 % A 2011 % A Ending AUM ($ Billions) $419 $406 3% $477 (12%) Average AUM (S Billions) $417 $411 2% $481 (13%) By Fee Type ($ Millions): Base Fees $423 $416 2% $510 (17%) Performance Fees 5 7 (38%) 5 (14%) Total $428 $423 1% $515 (17%)
Slide 30: Consolidated Balance Sheet
Consolidated Balance Sheet In US $ Millions, Assets Mar 31, 2012 Dec 34, 2011 Cash and cash equivalents ¥ aS 635 Cash and securities, segregated 785 1,280 Receivables, net 1,478 4,339 Investments: Deferred compensation - related 161 176 Other 722 619 Goodwill 2,954 2,955 Intangible assets, net 185 1
Slide 31: Consolidated Statement of Cash Flows
Consolidated Statement of Cash Flows In US § Millions Three Months Ended “Mar 31,2012 ~Mar3t, 2011 Net income $ % $ 728 Non-cash items: Amortization of deferred sales commissions 8 10 ‘Amortization of non-cash deferred compensation 5 43 Depreciation and other amortization 20 2 Unrealized (gains) on
Slide 32: AllianceBernstein Holding Financial Results
AllianceBernstein Holding Financial Results In US § Millions (excluding per unit amounts) 1a 4Q 1a 2012 2011 %A 2011 %A AllianceBernstein Net Income (Loss) Attributable to AllianceBernstein $87 ($516) nvm $136 (36%) Weighted Average Equity Ownership Interest 375% 37.5% 37.4% AllianceBernstein Holdin
Slide 33: AllianceBernstein Adjusted Earnings Reconciliation
AllianceBernstein Adjusted Earnings Reconciliation Three Months Ended $$ thousands, unaudited Bein aan 901 ——Bs0I1 asin __1aisiA0 Net Revenues, GAAP basis $ 681,809 $ 624978 $ 641,529 $ 727,994 $ 755,390 $ 777,561 Exclude: Deferred compensation-related investment (gains) losses (15570) (9.386) 37,84
Slide 34: AllianceBernstein Holding Adjusted Earnings Reconciliation
AllianceBernstein Holding Adjusted Earnings Reconciliation Three Months Ended $ thousands except per Unit amounts, unaudited 3312 12/31/11. 9/30/11 6/30/11 334/11 12134110 Net Income (Loss) - Diluted, GAAP basis 26,699 $ (199,463) $ 27,003 $ 35,653 43,923 $ 43,289 Impact on net income of AlianceBern
Slide 35: AllianceBernstein Adjusted Financial Results Reconciliation
AllianceBernstein Adjusted Financial Results Reconciliation AllianceBernstein L.P. Notes to Condensed Consolidated Statements of Income and Supplemental Information (Unaudited) Adjusted Net Revenues ‘Adjusted net revenues exclude investment gains and losses and dividends and interest on deferred com
Slide 36: ALLIANCEBERNSTEIN
45) ALLIANCEBERNSTEIN
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