Rise in profits at BlackRock as investors flock

BLACKROCK, the world’s largest money manager, said yesterday that its second-quarter profit rose 32 per cent, citing strong global demand from its retail and institutional clients and growth in markets.

Net income at the New York-based company totalled $729m (£479m), or $4.19 per share, up from $554m, or $3.08 per share, a year earlier.

Excluding a one-time tax benefit from a charitable contribution, earnings were $4.15 a share, beating the analysts’ average forecast of $3.82.

During the quarter, BlackRock generated $11.9bn in long-dated net new business, including 11 funds that each raised more than $1bn.

Total net long-term flows, however, were tempered by rare outflows – $963m – from the company’s iShares exchange-traded funds.

Much of that weakness came from the iShares flagship emerging markets equity, fixed income and commodities funds. BlackRock bought iShares from Barclays in 2009. The unit now accounts for roughly 22 per cent of its total assets under management.

The company’s retail business had net long-term inflows of $5.1bn, largely because of strong investor interest in the unconstrained fixed-income and multi-asset income offerings.

The company ended the quarter with assets under management of $3.9 trillion, including new money and market gains, and generated record base fees of $2.2bn.