BlackRock Earnings Top Wall Street Estimates

BlackRock Inc. (BLK), the largest publicly-traded U.S. asset manager, on Tuesday beat the Street for the second quarter with an adjusted-profit of $1.75 per share, or $239 million. Net income, as adjusted, was 117% higher than first quarter 2009 and 16% lower than second quarter 2008. The investment management firm said second-quarter profit dropped on a year-over-year basis as assets under management declined, but results improved from the first-quarter as equity and fixed income markets recovered.

“I am of the belief that markets are stabilizing and we are seeing that in client activity worldwide”- commented Larry Fink, Chairman and CEO of BlackRock.

The New York-based firm reported a profit of $218 mln, or $1.59 per share, down $56 mln from the year ago period ’s net income of $2 per share. Revenue was $1.03 billion, down from $1.39 billion on a y/y basis but up from $987 mln in the first quarter. Operating income for second quarter came in at $261 million and non-operating income was $51 million. The reported operating margin was 25.4%.

Blackrock said its net inflows of more than $15 billion for the quarter reflected not only a notable shift in investor sentiment and a willingness to redeploy cash across the risk spectrum, but also a reinvigoration of new business globally. The company saw inflows of $8.3 billion from U.S. clients and nearly $7 billion from international investors, particularly in Europe, Taiwan and the U.K.

Despite the improved results and investment performance, Mr. Fink remains cautious. “While markets were significantly more favorable during the second quarter, they remain choppy in the face of conflicting signals about global economic conditions,” he said. “These are difficult conditions for portfolio managers to navigate, and I am proud of the job our teams are doing.” [Blackrock]

Blackrock, which as of June 30 had $1.373 trillion worth of assets under management, will become the world’s largest asset manager when its $13.5 bln, June 11 acquisition of Barclays’ money management division becomes final.

In reporting today’s quarterly results the investment management firm joins Janus Capital Group (JNS) and Legg Mason Inc. (LM) in beating the Street expectations.

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