Lazard posts surprise gains

Marion Dakers
LAZARD posted better-than-expected quarterly results yesterday, as the New York-based firm enjoyed a boom in its asset management unit but slower gains in advisory revenue.

Net profit for the third quarter jumped 18 per cent on last year to $62.2m (£39.5m), or 46 cents a share, while revenue rose 11 per cent to $462.4m.

Analysts expected 42 cents a share and revenue of $442.3m for Lazard, which hired former JP Morgan Cazenove boss Naguib Kheraj to become chief executive of its international business earlier this month.

Assets under management rose 19 per cent to a record $143.6bn, while management fees soared 38 per cent to $184m, another all-time high for the firm.

“Our fundamentals and financial position remain strong. We continue to generate significant cash flow and we remain focused on containing discretionary spending while investing in our businesses for future growth,” said Michael J Castellano, Lazard’s chief financial officer.

Revenue from advising on deals jumped 29 per cent to $160.7m. Despite this lower-than-expected figure Lazard shares remained unchanged closing at $35.84 in New York trading yesterday.

Sales from restructuring work fell 45 per cent on last year to $66m, due to a continuing decline in the number and value of corporate defaults.

Devin Ryan, an analyst at Sandler O’Neil & Partners, said that advisory revenue was light, but added: “[T]hose revenues can bounce around from quarter to quarter.”

During the quarter, Lazard advised Coca-Cola Enterprises on transactions worth $14.4bn.