Exhibit 99.1
image011a20.jpg

Federated Investors, Inc. Reports Third Quarter 2018 Earnings
Q3 2018 EPS of $0.59 up 5 percent from $0.56 in Q3 2017
Managed assets reach a record $437 billion with completion of Hermes acquisition
Board declares $0.27 per share quarterly dividend
(PITTSBURGH, Pa., Oct. 25, 2018) — Federated Investors, Inc. (NYSE: FII), one of the nation's largest investment managers, today reported earnings per diluted share (EPS) of $0.59 for Q3 2018, compared to $0.56 for the same quarter last year on net income of $59.6 million for Q3 2018 compared to $56.4 million for Q3 2017. Federated reported EPS of $1.57 for both YTD 2018 and 2017 on YTD 2018 net income of $158.8 million compared to $159.5 million of net income for the same period last year. The results in this press release include the acquisition of Hermes Fund Managers Limited (Hermes), beginning July 1, 2018.
Federated's YTD 2018 results include a $27.2 million pre-tax net expense, representing $0.21 per diluted share net of tax, primarily from entering into two foreign exchange derivative instruments used to eliminate exposure to fluctuations in the British pound sterling in preparation for the Q3 2018 Hermes acquisition payment. In addition, Federated has incurred $9.9 million and $12.7 million for Q3 2018 and YTD 2018, respectively, in transaction-related costs directly attributable to the Hermes acquisition.
Federated's total managed assets were a record $437.2 billion at Sept. 30, 2018 with the completion of the Hermes acquisition, up $73.5 billion or 20 percent from $363.7 billion at Sept. 30, 2017 and up $57.5 billion or 15 percent from $379.7 billion at June 30, 2018. Total average managed assets for Q3 2018 were $433.9 billion, up $73.4 billion or 20 percent from $360.5 billion reported for Q3 2017 and up $47.9 billion or 12 percent from $386.0 billion reported for Q2 2018.
"Hermes incorporates environmental, social and governance factors into a wide range of actively managed strategies and stewardship services," said J. Christopher Donahue, president and chief executive officer. "Hermes and Federated are off to an exciting and promising start together. With demand for ESG investing on the rise, we look forward to Hermes' continued growth as we begin to offer Hermes' strategies to U.S. investors."
Federated's board of directors declared a dividend of $0.27 per share. The dividend is payable on Nov. 15, 2018 to shareholders of record as of Nov. 8, 2018. During Q3 2018, Federated purchased 276,982 shares of Federated class B common stock for $5.9 million.
Federated's equity assets were a record $84.1 billion at Sept. 30, 2018, primarily due to the inclusion of $25.7 billion of Hermes' assets. Equity assets were up $22.4 billion or 36 percent from $61.7 billion at Sept. 30, 2017 and up $26.1 billion or 45 percent from $58.0 billion at June 30, 2018. Top-selling equity funds during Q3 2018 on a net basis were Federated MDT Small Cap Core Fund, Federated Kaufmann Small Cap Fund, Federated MDT Small Cap Growth Fund, Federated MDT Mid Cap Growth Fund and Hermes SDG Engagement Equity Fund.
Federated's fixed-income assets were a record $65.4 billion at Sept. 30, 2018, primarily resulting from the inclusion of $2.8 billion of Hermes' assets. Fixed-income assets were up $12.7 billion or 24 percent from $52.7 billion at Sept. 30, 2017 and up

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Ray Hanley 412-288-1920

 
Federated Reports Q3 2018 Earnings
Page 2 of 12

$4.0 billion or 7 percent from $61.4 billion at June 30, 2018. Top-selling fixed-income funds during Q3 2018 on a net basis were Federated Ultrashort Bond Fund, Federated Institutional High Yield Bond Fund, Federated Short-Term Income Fund, Federated Floating Rate Strategic Income Fund and Federated Total Return Bond Fund.
Money market assets were $264.2 billion at Sept. 30, 2018, up $20.4 billion or 8 percent from $243.8 billion at Sept. 30, 2017 and up $9.0 billion or 4 percent from $255.2 billion at June 30, 2018. Money market fund assets were $183.0 billion at Sept. 30, 2018, up $5.1 billion or 3 percent from $177.9 billion at Sept. 30, 2017 and up $10.3 billion or 6 percent from $172.7 billion at June 30, 2018. Federated's money market separate account assets were $81.3 billion at Sept. 30, 2018, up $15.3 billion or 23 percent from $66.0 billion at Sept. 30, 2017 and down $1.3 billion or 2 percent from $82.6 billion at June 30, 2018.
Financial Summary
Q3 2018 vs. Q3 2017
Revenue increased $30.3 million or 11 percent primarily due to the consolidation of Hermes' revenue. This increase was partially offset by a decrease in revenue due to the adoption of the new revenue recognition accounting standard and higher voluntary fee waivers for certain money market funds for competitive purposes.
During Q3 2018, Federated derived 66 percent of its revenue from long-term assets (45 percent from equity assets, 15 percent from fixed-income assets, and 6 percent from alternative/private markets and multi-asset), 33 percent from money market assets, and 1 percent from sources other than managed assets.
Operating expenses increased $37.1 million or 20 percent primarily due to the consolidation of Hermes' expenses. This increase was partially offset by a decrease in distribution expense due to the adoption of the new revenue recognition accounting standard and a change in the mix of average money market fund assets.
Q3 2018 vs. Q2 2018
Revenue increased $52.6 million or 21 percent and operating expenses increased $51.5 million or 29 percent primarily due to the consolidation of Hermes.
Nonoperating income (expenses), net increased $30.9 million primarily due to a loss recorded in Q2 2018 from two foreign currency forward derivative instruments entered into in connection with the Hermes acquisition (FX Forward Loss).
YTD 2018 vs. YTD 2017
Revenue increased $3.8 million primarily due to the consolidation of Hermes revenue. This increase was significantly offset by a decrease in revenue due to the adoption of the new revenue recognition accounting standard, a change in the mix of average money market assets and a previously disclosed Q1 2017 change in a customer relationship.
For the first nine months of 2018, Federated derived 63 percent of its revenue from long-term assets (42 percent from equity assets, 16 percent from fixed-income assets, and 5 percent from alternative/private markets and multi-asset), and 37 percent from money market assets.
Operating expenses increased by $12.2 million or 2 percent primarily due to the consolidation of Hermes' expenses. This increase was partially offset by a decrease in expense due to the adoption of the new revenue recognition accounting standard and a change in the mix of average money market fund assets.
Nonoperating (expenses) income, net decreased $36.1 million due primarily to the FX Forward Loss. In addition, investment income, net decreased due to a decrease in the market value of investments, primarily from securities held by consolidated



 
Federated Reports Q3 2018 Earnings
Page 3 of 12

investment companies, and fewer gains realized from the redemption of investments in the nine-month period ended Sept. 30, 2018 as compared to the same period in 2017.
Federated's level of business activity and financial results are dependent upon many factors, including market conditions, investment performance and investor behavior. These factors and others, including asset levels and mix, product sales and redemptions, market appreciation or depreciation, revenues, currency fluctuations, fee waivers, acquisitions, expenses and regulatory changes, can significantly impact Federated's business activity levels and financial results. Risk factors and uncertainties that can influence Federated's financial results are discussed in the company's annual and quarterly reports as filed with the Securities and Exchange Commission (SEC).
Federated will host an earnings conference call at 9 a.m. Eastern on Oct. 26, 2018. Investors are invited to listen to Federated's earnings teleconference by calling 877-407-0782 (domestic) or 201-689-8567 (international) prior to the 9 a.m. start time. The call may also be accessed online in real time via the About Federated section of FederatedInvestors.com. A replay will be available from approximately 12:30 p.m. Eastern Oct. 26, 2018 until Nov. 2, 2018 by calling 877-481-4010 (domestic) or 919-882-2331 (international) and entering access code 37820. An online replay will be available via FederatedInvestors.com for one year.
Federated Investors, Inc. is one of the largest investment managers in the United States, managing $437.2 billion in assets as of Sept. 30, 2018. With 129 funds and a variety of separately managed account options, Federated provides comprehensive investment management to more than 9,600 institutions and intermediaries including corporations, government entities, insurance companies, foundations and endowments, banks and broker/dealers. Federated ranks in the top 6 percent of equity fund managers in the industry, the top 8 percent of money market fund managers and the top 11 percent of fixed-income fund managers1. Federated also ranks as the seventh-largest separately managed accounts manager2. Information regarding Hermes is available at Hermes-Investment.com. An analyst presentation that includes information about Hermes also is available. For more information, visit FederatedInvestors.com.
###
1) Strategic Insight, Sept. 30, 2018. Based on assets under management in open-end funds.
2) Money Management Institute/Dover Financial Research, Q2 2018.
Federated Securities Corp. is distributor of the Federated funds.
Separately managed accounts are made available through Federated Global Investment Management Corp., Federated Investment Counseling, Federated MDTA LLC, Hermes Investment Management Limited and Hermes European Equities Limited, each a registered investment adviser.
Certain statements in this press release, such as those related to growth expectations, anticipated product or strategy offerings, the level of fee waivers and expenses incurred by the company, performance, investor preferences and demand, asset flows and mix, customer relationships, acquisitions, integration and expenses constitute or may constitute forward-looking statements, which involve known and unknown risks, uncertainties and other factors that may cause the actual results, levels of activity, performance or achievements of the company, or industry results, to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements.  Other risks and uncertainties include the ability of the company to anticipate when products or strategies will be ready to be offered, predict the level of fee waivers and expenses in future quarters, sustain product demand, and asset flows and mix, which could vary significantly depending on various factors, such as market conditions, investment performance and investor behavior.  Other risks and uncertainties include the risk factors discussed in the company's annual and quarterly reports as filed with the SEC.  As a result, no assurance can be given as to future results, levels of activity, performance or achievements, and neither the company nor any other person assumes responsibility for the accuracy and completeness of such statements in the future.



 
Federated Reports Q3 2018 Earnings
Page 4 of 12

Unaudited Condensed Consolidated Statements of Income
(in thousands, except per share data)
 
 
 
 
 
 
 
Quarter Ended
% Change Q3 2017 to Q3 2018
 
Quarter Ended
% Change Q2 2018 to Q3 2018
 
Sept. 30, 2018
Sept. 30, 2017
 
June 30, 2018
Revenue
 
 
 
 
 
 
Investment advisory fees, net
$
217,036

$
184,886

17
 %
 
$
168,127

29
 %
Administrative service fees, net—affiliates
49,855

47,461

5

 
48,370

3

Other service fees, net
41,725

45,968

(9
)
 
39,496

6

Total Revenue
308,616

278,315

11

 
255,993

21

 
 
 
 
 
 
 
Operating Expenses
 
 
 
 
 
 
Compensation and related
103,092

72,454

42

 
74,147

39

Distribution
72,153

84,838

(15
)
 
69,446

4

Professional service fees
13,535

6,948

95

 
9,278

46

Systems and communications
12,213

7,992

53

 
7,751

58

Office and occupancy
9,332

7,293

28

 
7,365

27

Travel and related
4,622

3,258

42

 
3,523

31

Advertising and promotional
4,502

2,345

92

 
3,237

39

Other
7,269

4,497

62

 
489

NM

Total Operating Expenses
226,718

189,625

20

 
175,236

29

Operating Income
81,898

88,690

(8
)
 
80,757

1

 
 
 
 
 
 
 
Nonoperating Income (Expenses)
 
 
 
 
 
 
Investment income, net
1,199

3,556

(66
)
 
1,377

(13
)
Debt expense
(1,602
)
(1,250
)
28

 
(1,431
)
12

Other, net
2,240

1

NM

 
(28,974
)
(108
)
Total Nonoperating Income (Expenses), net
1,837

2,307

(20
)
 
(29,028
)
(106
)
Income before income taxes
83,735

90,997

(8
)
 
51,729

62

Income tax provision1
21,741

33,756

(36
)
 
13,062

66

Net income including the noncontrolling interests in subsidiaries
61,994

57,241

8

 
38,667

60

Less: Net income (loss) attributable to the noncontrolling interests in subsidiaries
2,386

802

198

 
(155
)
NM

Net Income
$
59,608

$
56,439

6
 %
 
$
38,822

54
 %
 
 
 
 
 
 
 
Amounts Attributable to Federated Investors, Inc.
 
 
 
 
 
 
Earnings Per Share2
 
 
 
 
 
 
Basic and diluted
$
0.59

$
0.56

5
 %
 
$
0.38

55
 %
Weighted-average shares outstanding
 
 
 
 
 
 
Basic
96,664

97,128

 
 
97,193

 
Diluted
96,664

97,129

 
 
97,194

 
Dividends declared per share
$
0.27

$
0.25

 
 
$
0.27

 
1) Sept. 30, 2018 and June 30, 2018 reflect a lower effective tax rate primarily due to the enactment of the Tax Cuts and Jobs Act of 2017 (Tax Act).
2) Unvested share-based awards that receive non-forfeitable dividend rights are deemed participating securities and are required to be considered in the computation of earnings per share under the "two-class method." As such, total net income of $2.8 million, $2.2 million and $1.5 million available to unvested restricted Federated shareholders and, to a lesser extent, unvested shareholders of a nonpublic consolidated subsidiary for the quarterly periods ended Sept. 30, 2018, Sept. 30, 2017 and June 30, 2018, respectively, was excluded from the computation of earnings per share.




 
Federated Reports Q3 2018 Earnings
Page 5 of 12

Unaudited Condensed Consolidated Statements of Income
(in thousands, except per share data)
 
 
 
 
Nine Months Ended
 
 
Sept. 30, 2018
Sept. 30, 2017
% Change
Revenue
 
 
 
Investment advisory fees, net
$
559,429

$
545,525

3
 %
Administrative service fees, netaffiliates
147,248

139,763

5

Other service fees, net
121,784

139,324

(13
)
Total Revenue
828,461

824,612

0

 
 
 
 
Operating Expenses
 
 
 
Compensation and related
255,613

217,226

18

Distribution
214,098

262,371

(18
)
Professional service fees
32,443

20,141

61

Systems and communications
28,397

24,258

17

Office and occupancy
24,238

21,805

11

Advertising and promotional
10,967

8,396

31

Travel and related
10,967

9,150

20

Other
9,412

10,591

(11
)
Total Operating Expenses
586,135

573,938

2

Operating Income
242,326

250,674

(3
)
 
 
 
 
Nonoperating (Expenses) Income
 
 
 
Investment income, net
3,294

11,707

(72
)
Debt expense
(4,363
)
(3,534
)
23

Other, net
(26,877
)
(32
)
NM

Total Nonoperating (Expenses) Income, net
(27,946
)
8,141

(443
)
Income before income taxes
214,380

258,815

(17
)
Income tax provision1
53,713

95,888

(44
)
Net income including the noncontrolling interests in subsidiaries
160,667

162,927

(1
)
Less: Net income attributable to the noncontrolling interests in subsidiaries
1,906

3,396

(44
)
Net Income
$
158,761

$
159,531

0
 %
 
 
 
 
Amounts Attributable to Federated Investors, Inc.
 
 
 
Earnings Per Share2
 
 
 
Basic and diluted
$
1.57

$
1.57

0
 %
Weighted-average shares outstanding
 
 
 
Basic
97,013

97,521

 
Diluted
97,014

97,522

 
Dividends declared per share
$
0.79

$
0.75

 
1) Sept. 30, 2018 reflects a lower effective tax rate primarily due to the enactment of the Tax Act.
2)
Unvested share-based awards that receive non-forfeitable dividend rights are deemed participating securities and are required to be considered in the computation of earnings per share under the “two-class method.” As such, total net income of $6.7 million and $6.3 million available to unvested restricted Federated shareholders and, to a lesser extent, unvested shareholders of a nonpublic consolidated subsidiary for the nine months ended Sept. 30, 2018 and Sept. 30, 2017, respectively, was excluded from the computation of earnings per share.





 
Federated Reports Q3 2018 Earnings
Page 6 of 12

Unaudited Condensed Consolidated Balance Sheets
 
 
(in thousands)
Sept. 30, 2018
Dec. 31, 2017
Assets
 
 
  Cash and other investments
$
157,059

$
369,538

  Other current assets
114,563

67,736

  Intangible assets, net, including goodwill
1,160,824

736,915

  Other long-term assets
91,211

57,221

  Total Assets
$
1,523,657

$
1,231,410

 
 
 
Liabilities, Redeemable Noncontrolling Interests and Equity
 
 
  Current liabilities
$
164,301

$
128,849

  Long-term debt
160,000

170,000

  Other long-term liabilities
179,248

141,183

  Redeemable noncontrolling interests
192,744

30,163

  Equity excluding treasury stock
1,121,518

1,039,947

  Treasury stock
(294,154
)
(278,732
)
  Total Liabilities, Redeemable Noncontrolling Interests and Equity
$
1,523,657

$
1,231,410



































 
Federated Reports Q3 2018 Earnings
Page 7 of 12

Unaudited Changes in Long-Term Assets - By Asset Class
(in millions)
Quarter Ended
 
Nine Months Ended
 
Sept. 30, 2018
June 30, 2018
Sept. 30, 2017
 
Sept. 30, 2018
Sept. 30, 2017
Equity
 
 
 
 
 
 
Beginning assets
$
57,973

$
58,830

$
60,404

 
$
62,816

$
56,759

Sales1
3,757

2,731

2,570

 
9,681

9,131

Redemptions1
(5,288
)
(5,078
)
(3,078
)
 
(15,624
)
(11,586
)
Net redemptions1
(1,531
)
(2,347
)
(508
)
 
(5,943
)
(2,455
)
Net exchanges
(11
)
202

(52
)
 
64

(53
)
Acquisition-related
24,700

0

0

 
24,700

287

Market gains and losses2
3,012

1,288

1,877

 
2,506

7,183

Ending assets
$
84,143

$
57,973

$
61,721

 
$
84,143

$
61,721

 
 
 
 
 
 
 
Fixed Income
 
 
 
 
 
 
Beginning assets
$
61,435

$
62,205

$
52,436

 
$
64,160

$
51,314

Sales1
5,163

4,755

3,587

 
14,826

11,778

Redemptions1
(4,418
)
(4,934
)
(3,897
)
 
(15,946
)
(12,415
)
Net sales (redemptions)1
745

(179
)
(310
)
 
(1,120
)
(637
)
Net exchanges
2

(207
)
53

 
(78
)
(73
)
Acquisition-related
2,732

0

0

 
2,732

148

Market gains and losses2
455

(384
)
522

 
(325
)
1,949

Ending assets
$
65,369

$
61,435

$
52,701

 
$
65,369

$
52,701

 
 
 
 
 
 
 
Alternative / Private Markets
 
 
 
 
 
 
Beginning assets
$
292

$
343

$
443

 
$
366

$
458

Sales1
757

15

22

 
813

94

Redemptions1
(674
)
(44
)
(49
)
 
(785
)
(177
)
Net sales (redemptions)1
83

(29
)
(27
)
 
28

(83
)
Net exchanges
(2
)
(2
)
1

 
(3
)
58

Acquisition-related3
18,509

0

0

 
18,509

0

Market gains and losses2
(261
)
(20
)
(10
)
 
(279
)
(26
)
Ending assets
$
18,621

$
292

$
407

 
$
18,621

$
407

 
 
 
 
 
 
 
Multi-asset
 
 
 
 
 
 
Beginning assets
$
4,730

$
4,843

$
5,011

 
$
5,014

$
5,164

Sales1
120

126

110

 
374

371

Redemptions1
(211
)
(229
)
(274
)
 
(675
)
(909
)
Net redemptions1
(91
)
(103
)
(164
)
 
(301
)
(538
)
Net exchanges
4

(2
)
(8
)
 
2

(21
)
Acquisition-related
45

0

0

 
45

0

Market gains and losses2
102

(8
)
159

 
30

393

Ending assets
$
4,790

$
4,730

$
4,998

 
$
4,790

$
4,998

 
 
 
 
 
 
 
Total Long-term Assets
 
 
 
 
 
 
Beginning assets
$
124,430

$
126,221

$
118,294

 
$
132,356

$
113,695

Sales1
9,797

7,627

6,289

 
25,694

21,374

Redemptions1
(10,591
)
(10,285
)
(7,298
)
 
(33,030
)
(25,087
)
Net redemptions1
(794
)
(2,658
)
(1,009
)
 
(7,336
)
(3,713
)
Net exchanges
(7
)
(9
)
(6
)
 
(15
)
(89
)
Acquisition-related3
45,986

0

0

 
45,986

435

Market gains and losses2
3,308

876

2,548

 
1,932

9,499

Ending assets
$
172,923

$
124,430

$
119,827

 
$
172,923

$
119,827

1) For certain accounts, Sales and Redemptions are calculated as the remaining difference between beginning and ending assets after the calculation of total investment return.
2) Reflects the approximate changes in the fair value of the securities held by the portfolios and, to a lesser extent, reinvested dividends, distributions, net investment income and the impact of changes in foreign exchange rates.
3)
Acquisition-related includes $8.4 billion of assets managed by a nonconsolidated entity, Hermes GPE LLP, in which Hermes holds an equity method investment.




 
Federated Reports Q3 2018 Earnings
Page 8 of 12

Unaudited Changes in Long-Term Assets - By Asset Class and Product Type

(in millions) 

 
 
Quarter Ended
 
Sept. 30, 2018
 
Equity
Fixed Income
Alternative / Private Markets
Multi-asset
Total
 
Funds
Separate Accounts1
Funds
Separate Accounts1
Funds2
Separate Accounts1
Funds
Separate Accounts1
Funds2
Separate Accounts1
Beginning assets
$
31,699

$
26,274

$
39,877

$
21,558

$
292

$
0

$
4,521

$
209

$
76,389

$
48,041

Sales
2,447

1,310

3,878

1,285

723

34

120

0

7,168

2,629

Redemptions
(3,047
)
(2,241
)
(3,883
)
(535
)
(270
)
(404
)
(205
)
(6
)
(7,405
)
(3,186
)
Net (redemptions) sales
(600
)
(931
)
(5
)
750

453

(370
)
(85
)
(6
)
(237
)
(557
)
Net exchanges
(9
)
(2
)
3

(1
)
(2
)
0

4

0

(4
)
(3
)
Acquisition-related
11,131

13,569

1,565

1,167

10,823

7,686

45

0

23,564

22,422

Market gains and losses3
1,357

1,655

377

78

(109
)
(152
)
100

2

1,725

1,583

Ending assets
$
43,578

$
40,565

$
41,817

$
23,552

$
11,457

$
7,164

$
4,585

$
205

$
101,437

$
71,486

 
 
 
 
 
 
 
 
 
 
 
 
Nine Months Ended
 
Sept. 30, 2018
 
Equity
Fixed Income
Alternative / Private Markets
Multi-asset
Total
 
Funds
Separate Accounts1
Funds
Separate Accounts1
Funds2
Separate Accounts1
Funds
Separate Accounts1
Funds2
Separate Accounts1
Beginning assets
$
33,008

$
29,808

$
41,144

$
23,016

$
366

$
0

$
4,783

$
231

$
79,301

$
53,055

Sales
5,763

3,918

11,817

3,009

779

34

374

0

18,733

6,961

Redemptions
(8,283
)
(7,341
)
(12,668
)
(3,278
)
(381
)
(404
)
(654
)
(21
)
(21,986
)
(11,044
)
Net (redemptions) sales
(2,520
)
(3,423
)
(851
)
(269
)
398

(370
)
(280
)
(21
)
(3,253
)
(4,083
)
Net exchanges
65

(1
)
(77
)
(1
)
(3
)
0

2

0

(13
)
(2
)
Acquisition-related
11,131

13,569

1,565

1,167

10,823

7,686

45

0

23,564

22,422

Market gains and losses3
1,894

612

36

(361
)
(127
)
(152
)
35

(5
)
1,838

94

Ending assets
$
43,578

$
40,565

$
41,817

$
23,552

$
11,457

$
7,164

$
4,585

$
205

$
101,437

$
71,486

1)
Includes separately managed accounts, institutional accounts, sub-advised funds and other managed products. For certain accounts, Sales and Redemptions are calculated as the remaining difference between beginning and ending assets after the calculation of total investment return.
2)
Acquisition-related includes $8.4 billion of assets managed by a nonconsolidated entity, Hermes GPE LLP, in which Hermes holds an equity method investment.
3)
Reflects the approximate changes in the fair value of the securities held by the portfolios and, to a lesser extent, reinvested dividends, distributions, net investment income and the impact of changes in foreign exchange rates.






 
Federated Reports Q3 2018 Earnings
Page 9 of 12

Unaudited Changes in Long-Term Assets - By Product Type

(in millions) 

Quarter Ended
 
Nine Months Ended
 
Sept. 30, 2018
June 30, 2018
Sept. 30, 2017
 
Sept. 30, 2018
Sept. 30, 2017
Total Fund Assets
 
 
 
 
 
 
Beginning assets
$
76,389

$
76,999

$
78,105

 
$
79,301

$
75,665

Sales
7,168

5,609

4,699

 
18,733

15,529

Redemptions
(7,405
)
(6,947
)
(5,566
)
 
(21,986
)
(18,430
)
Net redemptions
(237
)
(1,338
)
(867
)
 
(3,253
)
(2,901
)
Net exchanges
(4
)
(7
)
(6
)
 
(13
)
(33
)
Acquisition-related1
23,564

0

0

 
23,564

435

Market gains and losses2
1,725

735

1,723

 
1,838

5,789

Ending assets
$
101,437

$
76,389

$
78,955

 
$
101,437

$
78,955

 
 
 
 
 
 
 
Total Separate Accounts Assets3
 
 
 
 
 
 
Beginning assets
$
48,041

$
49,222

$
40,189

 
$
53,055

$
38,030

Sales4
2,629

2,018

1,590

 
6,961

5,845

Redemptions4
(3,186
)
(3,338
)
(1,732
)
 
(11,044
)
(6,657
)
Net redemptions4
(557
)
(1,320
)
(142
)
 
(4,083
)
(812
)
Net exchanges
(3
)
(2
)
0

 
(2
)
(56
)
Acquisition-related
22,422

0

0

 
22,422

0

Market gains and losses2
1,583

141

825

 
94

3,710

Ending assets
$
71,486

$
48,041

$
40,872

 
$
71,486

$
40,872

 
 
 
 
 
 
 
Total Long-term Assets3
 
 
 
 
 
 
Beginning assets
$
124,430

$
126,221

$
118,294

 
$
132,356

$
113,695

Sales4
9,797

7,627

6,289

 
25,694

21,374

Redemptions4
(10,591
)
(10,285
)
(7,298
)
 
(33,030
)
(25,087
)
Net redemptions4
(794
)
(2,658
)
(1,009
)
 
(7,336
)
(3,713
)
Net exchanges
(7
)
(9
)
(6
)
 
(15
)
(89
)
Acquisition-related1
45,986

0

0

 
45,986

435

Market gains and losses2
3,308

876

2,548

 
1,932

9,499

Ending assets
$
172,923

$
124,430

$
119,827

 
$
172,923

$
119,827

1)
Acquisition-related includes $8.4 billion of assets managed by a nonconsolidated entity, Hermes GPE LLP, in which Hermes holds an equity method investment.
2) Reflects the approximate changes in the fair value of the securities held by the portfolios and, to a lesser extent, reinvested dividends, distributions, net investment income and the impact of changes in foreign exchange rates.
3) Includes separately managed accounts, institutional accounts, sub-advised funds and other managed products.
4)
For certain accounts, Sales and Redemptions are calculated as the remaining difference between beginning and ending assets after the calculation of total investment return.



 
Federated Reports Q3 2018 Earnings
Page 10 of 12

Unaudited Managed Assets
(in millions)
Sept. 30, 2018

June 30, 2018

March 31, 2018

Dec. 31, 2017

Sept. 30, 2017

By Asset Class
 
 
 
 
 
Equity
$
84,143

$
57,973

$
58,830

$
62,816

$
61,721

Fixed-income
65,369

61,435

62,205

64,160

52,701

Alternative / private markets1
18,621

292

343

366

407

Multi-asset
4,790

4,730

4,843

5,014

4,998

Total long-term assets
172,923

124,430

126,221

132,356

119,827

Money market
264,233

255,247

265,944

265,214

243,840

Total Managed Assets
$
437,156

$
379,677

$
392,165

$
397,570

$
363,667

 
 
 
 
 
 
By Product Type
 
 
 
 
 
Funds:
 
 
 
 
 
Equity
$
43,578

$
31,699

$
31,507

$
33,008

$
32,637

Fixed-income
41,817

39,877

40,529

41,144

41,142

Alternative / private markets1
11,457

292

343

366

407

Multi-asset
4,585

4,521

4,620

4,783

4,769

Total long-term assets
101,437

76,389

76,999

79,301

78,955

Money market
182,966

172,671

182,437

185,536

177,865

Total Fund Assets
$
284,403

$
249,060

$
259,436

$
264,837

$
256,820

Separate Accounts:
 
 
 
 
 
Equity
$
40,565

$
26,274

$
27,323

$
29,808

$
29,084

Fixed-income
23,552

21,558

21,676

23,016

11,559

Alternative / private markets
7,164

0

0

0

0

Multi-asset
205

209

223

231

229

Total long-term assets
71,486

48,041

49,222

53,055

40,872

Money market
81,267

82,576

83,507

79,678

65,975

Total Separate Account Assets
$
152,753

$
130,617

$
132,729

$
132,733

$
106,847

Total Managed Assets
$
437,156

$
379,677

$
392,165

$
397,570

$
363,667

1) Alternative/private markets at Sept. 30, 2018 includes $8.4 billion of fund assets managed by a nonconsolidated entity, Hermes GPE LLP, in which Hermes holds an equity method investment.



 
Federated Reports Q3 2018 Earnings
Page 11 of 12

Unaudited Average Managed Assets
Quarter Ended
(in millions)
Sept. 30, 2018

June 30, 2018

March 31, 2018

Dec. 31, 2017

Sept. 30, 2017

By Asset Class
 
 
 
 
 
Equity
$
84,262

$
58,818

$
61,555

$
62,140

$
60,782

Fixed-income
64,750

61,648

63,538

64,280

52,559

Alternative / private markets1
18,504

319

355

397

425

Multi-asset
4,805

4,824

4,979

5,000

4,992

Total long-term assets
172,321

125,609

130,427

131,817

118,758

Money market
261,571

260,371

267,546

250,197

241,749

Total Avg. Managed Assets
$
433,892

$
385,980

$
397,973

$
382,014

$
360,507

 
 
 
 
 
 
By Product Type
 
 
 
 
 
Funds:
 
 
 
 
 
Equity
$
43,473

$
31,911

$
32,680

$
32,829

$
32,179

Fixed-income
41,501

40,199

41,022

41,169

40,896

Alternative / private markets1
11,109

319

355

397

425

Multi-asset
4,598

4,604

4,749

4,771

4,768

Total long-term assets
100,681

77,033

78,806

79,166

78,268

Money market
179,562

175,885

181,856

176,918

174,358

Total Avg. Fund Assets
$
280,243

$
252,918

$
260,662

$
256,084

$
252,626

Separate Accounts:
 
 
 
 
 
Equity
$
40,789

$
26,907

$
28,875

$
29,311

$
28,603

Fixed-income
23,249

21,449

22,516

23,111

11,663

Alternative / private markets
7,395

0

0

0

0

Multi-asset
207

220

230

229

224

Total long-term assets
71,640

48,576

51,621

52,651

40,490

Money market
82,009

84,486

85,690

73,279

67,391

Total Avg. Separate Account Assets
$
153,649

$
133,062

$
137,311

$
125,930

$
107,881

Total Avg. Managed Assets
$
433,892

$
385,980

$
397,973

$
382,014

$
360,507

1) Alternative/private markets for the quarter ended Sept. 30, 2018 includes $8.2 billion of fund assets managed by a nonconsolidated entity, Hermes GPE LLP, in which Hermes holds an equity method investment.



 
Federated Reports Q3 2018 Earnings
Page 12 of 12

Unaudited Average Managed Assets
 
Nine Months Ended
(in millions)
 
Sept. 30, 2018
 
Sept. 30, 2017
By Asset Class
 
 
 
 
Equity
 
$
68,212

 
$
59,627

Fixed-income
 
63,312

 
52,178

Alternative / private markets1
 
6,393

 
456

Multi-asset
 
4,869

 
5,083

Total long-term assets
 
142,786

 
117,344

Money market
 
263,162

 
243,879

Total Avg. Managed Assets
 
$
405,948

 
$
361,223

 
 
 
 
 
By Product Type
 
 
 
 
Funds:
 
 
 
 
Equity
 
$
36,022

 
$
31,938

Fixed-income
 
40,907

 
40,511

Alternative / private markets1
 
3,928

 
456

Multi-asset
 
4,650

 
4,864

Total long-term assets
 
85,507

 
77,769

Money market
 
179,100

 
176,467

Total Avg. Fund Assets
 
$
264,607

 
$
254,236

Separate Accounts:
 
 
 
 
Equity
 
$
32,190

 
$
27,689

Fixed-income
 
22,405

 
11,667

Alternative / private markets
 
2,465

 
0

Multi-asset
 
219

 
219

Total long-term assets
 
57,279

 
39,575

Money market
 
84,062

 
67,412

Total Avg. Separate Account Assets
 
$
141,341

 
$
106,987

Total Avg. Managed Assets
 
$
405,948

 
$
361,223

1) Alternative/Private Markets for the nine months ended Sept. 30, 2018 includes $2.7 billion of fund assets managed by a nonconsolidated entity, Hermes GPE LLP, in which Hermes holds an equity method investment.


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