Asset manager Sprott's profit plunges on lower management fees

Thu Aug 9, 2012 7:50am EDT
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(Reuters) - Canadian asset manager Sprott Inc's (SII.TO: Quote) second-quarter profit fell 90 percent on lower management fees.

Net income fell to C$700,000, or breakeven per share, for the April-June quarter, from C$7.5 million, or 4 Canadian cents per share, a year earlier.

Management fees fell 25 percent during the quarter to C$28.1 million. Assets under management (AUM) fell 9 percent to C$8.5 billion, at the end of the quarter, from C$9.3 billion, a year earlier.

Sprott said the decrease in management fees is attributable to the lower average AUM for the quarter as well as an increase in lower-margin offerings such as the physical bullion trusts and fixed-income products.

Shares of the Toronto-based company, which has a market value of C$841.7 million, closed at C$4.93 on Wednesday on the Toronto Stock Exchange.

(Reporting by Shounak Dasgupta in Bangalore; Editing by Supriya Kurane)