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Janus earnings rise on higher stock prices

Janus Capital Group Inc. Wednesday reported higher quarterly earnings on rising stock prices, but assets under management grew at a rate below the industry average, hurt by a scandal over improper trading in mutual funds.
/ Source: Reuters

Janus Capital Group Inc. Wednesday reported higher quarterly earnings on rising stock prices, but assets under management grew at a rate below the industry average, hurt by a scandal over improper trading in mutual funds.

Fourth-quarter income, excluding a one-time gain, was $54.5 million, or 23 cents per diluted share, compared with $45.1 million, or 20 cents per diluted share a year earlier.

The consensus estimate among analysts was 22 cents per share, with a range of 15 cents to 27 cents, according to Reuters Research, a unit of Reuters Group Plc.

Including a $631.3 million gain from a share exchange with DST Systems Inc, net income was $812.9 million, or $3.52 per diluted share.

Janus said it took a $62.8 million charge to cover a previously announced $31.5 million in costs related to improper trading at the company.

Investors have pulled money from Janus and other fund companies that have been swept up in a scandal over improper trading that has rocked the mutual fund industry.

Janus’s assets under management at the end of December were $151.5 billion, a 9.5 percent gain from $138.4 billion a year earlier. According to the Investment Company Institute, the combined assets in U.S. stock funds rose 38 percent to $3.68 trillion at December’s end.

Assets under management is a key driver of earnings at money managers, as fees are charged as a percentage of the assets a company manages. Revenue was $261.4 million, up from $243.1 million a year earlier.