March 26, 2009 / 1:08 PM / 9 years ago

UPDATE 2-Canada's Sprott says AUMs fell $1.2 bln in Q4

* AUM fall $1.2 bln sequentially in Q4

* Q4 profit, rev miss estimates (Recasts; adds background)

March 26 (Reuters) - Canadian money management firm Sprott Inc SII.TO said assets under management (AUM) fell $1.2 billion sequentially in the fourth quarter, as the market value of its holdings declined and risk-averse institutional investors withdrew funds.

“The current global economic crisis is unprecedented in scale and scope, making investment analysis unusually challenging,” Eric Sprott, one of Canada’s most successfull and high profile money managers, said in a statement.

The fall in AUM, a key driver of revenue at money managers, reflected C$600 million in net redemptions and another C$600 million in net market value depreciation, the company said in a statement.

The majority of fourth quarter redemptions related to offshore hedge funds as institutional investors who own these funds tried to reduce risky leveraged positions in their portfolios, the company said in a statement.

Sprott has advocated that investors seek safety in gold in the current market meltdown and his firm Sprott Asset Management specializes in natural resources mining companies, precious metals and energy [ID:nN09472576].

Earnings per share for the quarter dropped about 33 percent to 14 Canadian cents a share as revenue slumped more than 64 percent to C$57.7 million.

Analysts, on average, were looking for a profit of 17 Canadian cents a share, excluding items, on revenue of $68.11 million according to Reuters Estimates.

Shares of the company, which went public at C$10 a share in May 2008, closed at C$4.59 Wednesday on the Toronto Stock Exchange. (Reporting by Anurag Kotoky in Bangalore; Editing by Jarshad Kakkrakandy, Vikram S Subhedar)

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