BlackRock profit up 32 percent on strong investor demand

Thu Jul 18, 2013 8:00am EDT
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(Reuters) - BlackRock Inc (BLK.N: Quote), the world's largest money manager, said on Thursday that its second-quarter profit rose 32 percent, citing strong global demand from its retail and institutional clients and growth in markets.

Net income at the New York-based company totaled $729 million, or $4.19 per share, up from $554 million, 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, according to Thomson Reuters I/B/E/S.

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

Total net long-term flows, however, were tempered by rare outflows - $963 million - 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, the largest U.S. provider of exchange-traded funds, bought iShares from Barclays in 2009. The unit now accounts for roughly 22 percent of its total assets under management.

The company's retail business had net long-term inflows of $5.1 billion, 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 $2.2 billion.

(Reporting by Ashley Lau in New York; Editing by Lisa Von Ahn)

A BlackRock building is seen in New York June 12, 2009. REUTERS/Eric Thayer