MLIM third-quarter earnings up 59%

GLOBAL – Third-quarter pre-tax earnings at Merrill Lynch Investment Managers were up 59% – despite what the firm called a “progressively more challenging market environment”.

“Despite a progressively more challenging market environment, MLIM's strategy has generated consistent quarterly pre-tax earnings for the first nine months of 2004, which are more than double those for the prior-year period,” parent firm Merrill Lynch said.

MLIM's third quarter pre-tax earnings rose 59% to 110 million dollars over the third quarter of 2003, although they were down slightly from the 2004 second quarter.

Net revenues increased 10% from the year-ago period, to 373 million dollars – “driven primarily by increased average asset values”.

Total assets under management were 478 billion dollars at the end of the third quarter, up slightly from the year-ago quarter and two percent lower than the second quarter of 2004.

The firm said: “The sequential decline was due principally to net outflows from short-term institutional liquidity products, largely the result of increases in short-term interest rates.”

Overall, the New York-based firm reported an eight percent decline in net earnings to 920 million dollars – due to “reduced activity levels”.

“Like the rest of the industry, we experienced very challenging market conditions and resulting revenue pressures in the quarter," said chairman and chief executive Stan O'Neal.

"However, over the past three years our repositioning of the company's business model, combined with the realignment of our cost base and our revenue diversification efforts, enabled us to deliver solid results that kept us on track for record earnings for the first nine months of 2004.”

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