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Waddell Reed Financial Inc (WDR) SEC Filing 10-K Annual report for the fiscal year ending Monday, December 31, 2018

Waddell Reed Financial Inc

CIK: 1052100 Ticker: WDR

Exhibit 99.1

 

 

 

News Release

 

Waddell & Reed Financial, Inc. Reports Fourth Quarter Results

 

Overland Park, KS, Feb. 5, 2019

— Waddell & Reed Financial, Inc. (NYSE: WDR) today reported fourth quarter 2018 net income(1) of $46.5 million, or $0.60 per diluted share, compared to net income of $46.3 million, or $0.58 per diluted share, during the prior quarter and net income of $29.8 million, or $0.36 per diluted share, during the fourth quarter of 2017.  The fourth quarter of 2018 included a gain of $16.1 million compared to a loss of $6.5 million in the prior year fourth quarter related to the annual revaluation of the pension plan liability.  The prior year also included a non-recurring tax charge of $5.4 million related to the Tax Cuts and Jobs Act.

 

Revenues of $272.2 million during the quarter decreased $22.9 million and $22.3 million compared to the third quarter of 2018 and the fourth quarter of 2017, respectively.  Operating expenses of $227.8 million declined $7.8 million compared to the prior quarter and declined $4.9 million compared to the same quarter in 2017.  The operating margin was 16.3% during the current quarter, compared to 20.2% and 21.0% during the third quarter of 2018 and the fourth quarter of 2017, respectively.  For the twelve-month period ended December 31, 2018, the operating margin was 19.1%, consistent with the prior year’s operating margin of 19.0%.

 

Assets under management ended the quarter at $65.8 billion, a 17% decrease compared to the prior quarter and a decrease of 19% compared to the fourth quarter of 2017.  The lower assets under management were primarily driven by market volatility in the quarter.  Sales of $2.7 billion during the current quarter improved 7%, compared to the prior quarter and were comparable with the fourth quarter of 2017.  Net outflows of $3.8 billion during the current quarter included $1.0 billion of previously disclosed outflows related to institutional accounts primarily due to certain portfolio manager departures. Excluding the impact of the institutional accounts, net outflows were higher compared to net outflows of $2.0 billion in the third quarter of 2018 and were consistent with the fourth quarter of 2017.  Redemptions continued to improve in 2018, with net outflows for the year improving 9% to $10.4 billion compared to $11.4 billion in 2017.

 

Broker-dealer assets under administration ended the quarter at $51.3 billion, a 12% decrease compared to the third quarter of 2018 primarily due to market depreciation. Compared to the same quarter in 2017, assets under administration decreased 10% due to a reduction in net new assets of $3.1 billion and market depreciation. Average productivity per advisor, as measured by average trailing twelve-month revenue per advisor, was $378 thousand for the twelve-month period ended December 31, 2018, rising 8% compared to the prior quarter and 48% compared to the prior year.

 

“While the industry landscape remains challenging, we continued to make foundational improvements over the past year that will better position our company for long term success,” said Philip J. Sanders, Chief Executive Officer of Waddell & Reed Financial, Inc.  “Within our asset management business, we improved investment performance track records across much of the complex and realigned our sales leadership to provide more focused coverage across all distribution channels.  We also made meaningful progress toward improving the competitiveness of our broker-dealer by optimizing our field and support structure, announcing significant technology investments and enhancing our product offerings and advisory programs — all to the benefit of advisors and clients.”

 


The following information was filed by Waddell Reed Financial Inc (WDR) on Tuesday, February 5, 2019 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Inside Waddell Reed Financial Inc's 10-K Annual Report:

Financial Statements, Disclosures and Schedules

Inside this 10-K Annual Report

Document And Entity Information
Consolidated Balance Sheets
Consolidated Balance Sheets (Parenthetical)
Consolidated Statement Of Stockholders??? Equity
Consolidated Statement Of Stockholders??? Equity (Parenthetical)
Consolidated Statements Of Cash Flows
Consolidated Statements Of Comprehensive Income
Consolidated Statements Of Comprehensive Income (Parenthetical)
Consolidated Statements Of Income
Consolidated Statements Of Income (Parenthetical)
Concentrations Of Risk
Contingencies
Contingencies (Details)
Defined Contribution Plan
Defined Contribution Plan (Details)
Derivative Financial Instruments
Derivative Financial Instruments (Details)
Derivative Financial Instruments (Tables)
Goodwill And Identifiable Intangible Assets
Goodwill And Identifiable Intangible Assets (Details)
Goodwill And Identifiable Intangible Assets (Tables)
Income Taxes
Income Taxes (Tables)
Income Taxes - Deferred Tax Liabilities And Deferred Tax Assets (Details)
Income Taxes - Provision For Income Taxes And Reconciliation Of Statutory Federal Income Tax Rate With Effective Income Tax Rate (Details)
Income Taxes - Reconciliation Of Unrecognized Tax Benefits (Details)
Income Taxes - Unrecognized Tax Benefits Narrative (Details)
Indebtedness
Indebtedness (Details)
Investment Securities
Investment Securities (Tables)
Investment Securities - Available For Sale Sponsored Funds With Fair Values Below Carrying Values (Details)
Investment Securities - Consolidated Sponsored Funds (Details)
Investment Securities - Fair Value Of Investment Securities (Details)
Investment Securities - Investment Category (Details)
Investment Securities - Investment Securities (Details)
Investment Securities - Investment Securities And Summary Of The Gains (Losses) Related To Securities (Details)
Investment Securities - Maturity (Details)
Investment Securities - Sponsored Privately Offered Funds (Details)
New Accounting Guidance
New Accounting Guidance (Details)
Pension Plan And Postretirement Benefits Other Than Pension
Pension Plan And Postretirement Benefits Other Than Pension (Tables)
Pension Plan And Postretirement Benefits Other Than Pension - Changes In Net Funded Status, Disclosure Of Amounts Recognized In The Balance Sheet, And The Assumptions Used To Determine The Benefit (Details)
Pension Plan And Postretirement Benefits Other Than Pension - Components Of Net Periodic Costs, Weighted Average Assumptions, And Expected Benefit Payments (Details)
Pension Plan And Postretirement Benefits Other Than Pension - Narrative (Details)
Pension Plan And Postretirement Benefits Other Than Pension - Pension Plan Asset Allocation (Details)
Pension Plan And Postretirement Benefits Other Than Pension - Plan Assets Fair Value (Details)
Property And Equipment
Property And Equipment (Details)
Property And Equipment (Tables)
Related Party Transactions
Related Party Transactions (Details)
Related Party Transactions (Tables)
Rental Expense And Lease Commitments
Rental Expense And Lease Commitments (Details)
Rental Expense And Lease Commitments (Tables)
Revenue Recognition
Revenue Recognition (Tables)
Revenue Recognition - Disaggregation Of Revenue (Details)
Selected Quarterly Information (Unaudited)
Selected Quarterly Information (Unaudited) (Details)
Selected Quarterly Information (Unaudited) (Tables)
Share-Based Compensation
Share-Based Compensation (Tables)
Share-Based Compensation - Narrative (Details)
Share-Based Compensation - Nonvested Share Activity And Related Fair Value (Details)
Stockholders' Equity
Stockholders' Equity (Tables)
Stockholders' Equity - Earnings Per Share (Details)
Stockholders' Equity - Other Comprehensive Income (Loss) Activity (Details)
Stockholders' Equity - Reclassifications From Accumulated Other Comprehensive Income (Loss) And Included In Net Income (Details)
Summary Of Significant Accounting Policies
Summary Of Significant Accounting Policies (Policies)
Summary Of Significant Accounting Policies - Advertising And Promotion (Details)
Summary Of Significant Accounting Policies - Basis Of Presentation And Consolidation (Details)
Summary Of Significant Accounting Policies - Deferred Sales Commissions And Revenue Recognition (Details)
Summary Of Significant Accounting Policies - Share Based Compensation And Accounting For Income Taxes (Details)
Summary Of Significant Accounting Policies - Summary Of Property And Equipment (Details)
Uniform Net Capital Rule Requirements
Uniform Net Capital Rule Requirements (Tables)
Uniform Net Capital Rule Requirements - Narrative (Details)
Uniform Net Capital Rule Requirements - Net Capital And Aggregated Indebtedness Information For Broker/Dealer Subsidiaries (Details)
Ticker: WDR
CIK: 1052100
Form Type: 10-K Annual Report
Accession Number: 0001558370-19-000908
Submitted to the SEC: Fri Feb 22 2019 10:10:33 AM EST
Accepted by the SEC: Fri Feb 22 2019
Period: Monday, December 31, 2018
Industry: Security Brokers Dealers And Flotation Companies

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