(Reuters) - Asset manager AllianceBernstein LP (AB.N) said first-quarter net revenue dropped 10 percent as customers pulled more money out of its stock funds and accounts, which target undervalued companies.
AllianceBernstein, controlled by French insurance giant Axa SA (AXAF.PA), said net revenue totaled $682 million, down from $755 million a year earlier.
Net income was 26 cents per unit, beating analysts’ average estimate by 2 cents, according to Thomson Reuters I/B/E/S.
Operating income for AllianceBernstein’s operating partnership was $101.2 million, down 27 percent from a year earlier. The company was hurt by lower asset management fees and lower fees for its Bernstein research services.
The company said it had net outflows of $12.1 billion in the quarter, the lowest total since the second quarter of 2010.
AllianceBernstein said it was hurt by AXA’s sales of its Canadian and Australian businesses in 2011. Those sales accounted for $5.8 billion, or about half, of its outflows in the first quarter.
Assets under management at the end of March totaled $419 billion, down 12 percent from a year earlier but up 3 percent from the end of the preceding quarter.
Outflows in the quarter were offset by $25.3 billion in market appreciation.
AllianceBernstein continues to experience disruptions within its value investment strategies, even though stock performance has improved.
In the first quarter, sales of $2.1 billion for value stock strategies were more than offset by $8.8 billion in client redemptions and terminations. Net outflows were offset by $9.8 billion in investment performance improvement.
Reporting By Tim McLaughlin in Boston; Editing by Lisa Von Ahn and John Wallace