Tuesday 16 April 2019 12:38 pm

Blackrock profits fall but still beat analysts' expectations

Blackrock saw profits fall in the first quarter of the year but the fund management giant nonetheless beat analysts’ expectations after announcing results today.

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Shares in the company had risen 2.7 per cent just after 4pm UK time, to $4.64 ($3.56).

The figures

Net income attributable to Blackrock fell to $1.1bn (£803m) in the first quarter, a four per cent drop compared to a year earlier.

This took the American investment firm’s earnings per share to $6.61, a one per cent fall compared to the $6.70 figure of a year previously. The figure was better than the consensus prediction of $6.13.

The Wall Street titan saw its revenue fall seven per cent in the first quarter compared to a year earlier, to reach $3.3bn.

Why it's interesting

Blackrock remained the world’s largest fund manager, increasing its assets under management three per cent year-on-year to a whopping $6.5 trillion.

The company saw a 14 per cent net inflow year-on-year, with inflows from all product types reaching $64.7bn.

Blackrock said its exchange-traded funds (ETFs), branded iShares, which track stock indexes, once again captured the number one market share of global ETF industry flows.

The company also revealed its employee compensation and benefits decreased in the first quarter to $1.06bn compared to $1.12bn a year earlier.

Goldman Sachs similarly announced that it had cut employee pay when it posted results yesterday.

What Blackrock said

Chairman and chief executive Larry Fink focused on the firm’s technological progress, saying: “The breadth of our investment capabilities, spanning index, alpha-seeking, alternatives and cash, coupled with our industry-leading technology and portfolio construction capabilities, allowed us to generate strong flows and continue to meet the evolving needs of our global clients.

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“We continued to strategically invest in our world-class Aladdin technology business, which grew revenue 11 per cent year-over-year.”

He added: “Blackrock continues to build and evolve our organisation, ahead of changing client needs, in order to drive strong investment performance, enhance the client experience and deliver long-term value for shareholders.”