46 slides from Alliancebernstein Holding L.p's earnings presentation, Oct 26, 2006
Slide 1: Third Quarter 2006 Review
Third Quarter 2006 Review Gerald M. Lieberman President & Chief Operating Officer Lewis A. Sanders Chairman & Chief Executive Officer Any forecasts in this material may not be realized. Information or opinions should not be construed as investment advice. October 25,
Slide 2: Forward-Looking Statements
Forward-Looking Statements Certain statements in this presentation are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks, uncertainties, and other factors that could cause actual results to d
Slide 3: AllianceBernstein – Third Quarter Highlights
< Equity and Fixed Income markets strong < Relative performance mixed = Value generally outperformed = Fixed Income close to benchmarks = Growth generally underperformed < Positive net AUM flows came in as expected < Financial performance vs. September 2005 = AllianceBernstein (Operating) Ø Net Reve
Slide 4: Market Performance - U.S.
*12 months ending September 30, 2006. Source: Frank Russell Company, Standard & Poor’s, and Lehman Brothers. Market Performance - U.S.
Slide 5: Market Performance - Non-U.S.
*12 months ending September 30, 2006. Source: MSCI (Morgan Stanley Capital International). Market Performance - Non-U.S.
Slide 6: Relative Performance Summary
< Relative investment performance for the quarter = Value Equities generally outperformed = Fixed Income results were close to benchmarks = Growth Equities generally underperformed < Competitive or better longer-term performance vs. benchmarks = Global and International Value Equities = Fixed Income
Slide 7: Investment Performance: Delivering Results for Clients
The information in this table is provided solely for use in connection with this presentation and is not directed towards existing or potential investment advisory clients of AllianceBernstein. Past performance is no guarantee of future results. Source: Nomura, Russell Investment Group, Scotia Capit
Slide 8: Changes in Assets Under Management By Channel (Three Months)
Three Months Ended September 30, 2006 In $ Millions Changes in Assets Under Management By Channel
Slide 9: Changes in Assets Under Management By Channel (Twelve Months)
Twelve Months Ended September 30, 2006 In $ Millions Changes In Assets Under Management By Channel
Slide 10: Changes in AUM By Investment Service (Three Months)
Three Months Ended September 30, 2006 In $ Millions Changes in Assets Under Management By Investment Service
Slide 11: Changes in AUM By Investment Service (Twelve Months)
Twelve Months Ended September 30, 2006 In $ Millions Changes In Assets Under Management By Investment Service
Slide 12: Institutional Investments—Third Quarter Highlights
(1) Acquisition of Hong Kong joint venture interest; disposition of South African joint venture interest. (2) Transfers of certain client accounts were made among distribution channels resulting from changes in how these accounts are serviced by the firm. AUM as of September 30, 2006 reflect these t
Slide 13: Retail—Third Quarter Highlights
(1) Transfers of certain client accounts were made among distribution channels resulting from changes in how these accounts are serviced by the firm. AUM as of September 30, 2006 reflect these transfers. (2) Mainly Retail; includes some Private Client and Institutional Investments assets. (3) As pro
Slide 14: Private Client—Third Quarter Highlights
(1) Transfers of certain client accounts were made among distribution channels resulting from changes in how these accounts are serviced by the firm. AUM as of September 30, 2006 reflect these transfers. Private Client— Third Quarter Highlights < Positive net flows for the quarter < Financial Adviso
Slide 15: Institutional Research Services—Third Quarter Highlights
< Revenues down 3.6% from prior year quarter but up 7.8% year-to-date < Higher market share and volume, partially offset by industry-wide pricing declines < Client use of our algorithmic trading platform in the U.S. continues to grow; on schedule for early 2007 launch in Europe < Spectacular results
Slide 16: Growth in Global Assets
By Client Domicile By Investment Service In $ Billions $659 Billion +19% at Sept. 30, $555 Billion at Sept. 30, 2005 Growth in Global Assets
Slide 17: Growth in Blend Strategies Assets
Assets Under Management by Investment Service $659 Billion Blend Strategies AUM $116 Billion (1) (1) Includes $4 billion of Blend Fixed Income AUM. Growth in Blend Strategies Assets
Slide 18: AllianceBernstein Third Quarter Revenues
(1) Includes $4 million reclassified from advisory fees. (2) Includes Shareholder Servicing, Investment Gains (Losses) and Other Revenues. NOTE: Percentages are calculated using revenues and expenses rounded to the nearest thousand. AllianceBernstein Third Quarter Revenues
Slide 19: AllianceBernstein Third Quarter Advisory Fees
NOTE: Percentages are calculated using revenues and expenses rounded to the nearest thousand. AllianceBernstein Third Quarter Advisory Fees
Slide 20: AllianceBernstein Third Quarter Expenses
NOTE: Percentages are calculated using revenues and expenses rounded to the nearest thousand. In $ Millions AllianceBernstein Third Quarter Expenses
Slide 21: AllianceBernstein Third Quarter Compensation & Benefits
NOTE: Percentages are calculated using revenues and expenses rounded to the nearest thousand. In $ Millions AllianceBernstein Third Quarter Compensation & Benefits
Slide 22: AllianceBernstein Third Quarter Expenses
NOTE: Percentages are calculated using revenues and expenses rounded to the nearest thousand. In $ Millions AllianceBernstein Third Quarter Expenses
Slide 23: AllianceBernstein Third Quarter Net Income
(1) Operating Income as a percentage of net revenues NOTE: Percentages are calculated using revenues and expenses rounded to the nearest thousand. In $ Millions AllianceBernstein Third Quarter Net Income
Slide 24: AllianceBernstein Holding Financial Results
NOTE: Percentages are calculated using revenues and expenses rounded to the nearest thousand. In $ Millions (except per unit amounts) AllianceBernstein Holding Financial Results
Slide 25: Hedge Funds: Leveraging the Firm's Core Competencies
< Portfolio Construction < Superior Performance = Long and short equities = Long and short fixed income = Currencies = Commodities = Asset allocation = Risk management = Cross-asset-class optimization = Tax minimization = High information ratios = Alpha/beta flexibility Hedge Funds: Leveraging the F
Slide 26: Premium returns notes
Premium returns are based on the past performance of the AllianceBernstein Hedge Funds, the results of AllianceBernstein’s proprietary models and simulations, the AllianceBernstein Hedge Fund’s expected volatility and investment guidelines regarding factors such as leverage, net market exposure, and
Slide 27: Newest Hedge Fund Offerings Utilize Five Distinct Alpha Sources
Expected Long-Term Contributions to Premium (Simulated) NOTE: Expected Long-Term Contributions to Premium are based on a research simulation and reflect the return premium in excess of cash; there is no assurance that premiums will occur in the patterns depicted here, or that each of the components
Slide 28: Low Correlation of Alpha Sources Expected to Produce High Information Ratios
Correlations of Alpha Sources (Simulated) NOTE: Correlations of Alpha Sources are based on a research simulation and reflect the return premium in excess of cash; there is no assurance that premiums will occur in the patterns depicted here, or that each of the components will always generate a premi
Slide 29: Multi-Strategy Portfolios Expected to Have Low Correlation to Capital Market Returns
Source: Lehman Brothers, MSCI, and AllianceBernstein estimates No Correlation 0.0 Perfect Correlation 1.0 Bond Market Global Stock Market Expected Correlations (Simulated) Multi-Strategy Portfolios Expected to Have Low Correlation to Capital Market Returns
Slide 30: Hedge Fund AUM Growing Rapidly
Asset Under Management in $ Billions (1) Nine months annualized Hedge Fund AUM Growing Rapidly
Slide 31: AllianceBernstein
B ALLIANCEBERNSTEIN
Slide 32: AllianceBernstein
B -ALLIANCEBERNSTEIN
Slide 33: Market returns table
Annualized Cumulative 30.06 One Year Three Years Three Years S&P 500 57 10.8 12.3 416 Russell 1000 Growth 39 60 a4 272 Russell 1000 Value 62 146 172 612 MSC! Emerging Markets 49 205 306 122.7 MSCI EAFE 39 19.2 22.3 83.0 MSCI World 45 14.2 167 59.0 Lehman Aggregate Bond 38 37 34 105 Retuns in % thoug
Slide 34: Relative Performance: Institutional Growth Equity (After Fees)
Relative Performance: Institutional Growth Equity (After Fees) (1)
Slide 35: Relative Performance: Institutional Value Equity (After Fees)
Relative Performance: Institutional Value Equity (After Fees) (1)
Slide 36: Relative Performance: Blend Strategies Services (After Fees)
Relative Performance: Blend Strategies Services (After Fees) (1)
Slide 37: Relative Performance: Institutional Fixed Income (After Fees)
Relative Performance: Institutional Fixed Income (After Fees) (1)
Slide 38: Absolute Performance: Private Client (After Fees)
Absolute Performance: Private Client (After Fees) (1)
Slide 39: Relative Performance: Retail Growth Equity (After Fees)
Relative Performance: Retail Growth Equity (After Fees) (1)
Slide 40: Relative Performance: Retail Value Equity (After Fees)
Relative Performance: Retail Value Equity (After Fees) (1)
Slide 41: Relative Performance: Retail Fixed Income (After Fees)
Relative Performance: Retail Fixed Income (After Fees) (1)
Slide 42: Relative Performance: Wealth Strategies (After Fees)
Relative Performance: Wealth Strategies (After Fees) (1)
Slide 43: AllianceBernstein Transaction Fees
In $ Millions AllianceBernstein Transaction Fees
Slide 44: AllianceBernstein Consolidated Balance Sheet
In $ Thousands, Unaudited AllianceBernstein Consolidated Balance Sheet
Slide 45: AllianceBernstein Consolidated Cash Flow
In $ Thousands, Unaudited AllianceBernstein Consolidated Cash Flow
Slide 46: AllianceBernstein trademarks
AllianceBernstein® and the AB AllianceBernstein Logo are trademarks and service marks owned by AllianceBernstein L.P.