January 30, 2008 / 1:38 PM / in 10 years

UPDATE 2-AGF Management profit soars, hikes dividend

(Adds details from conference call, stock price)

TORONTO, Jan 30 (Reuters) - AGF Management Ltd AGFb.TO said on Wednesday it more than doubled its fourth-quarter profit and hiked its quarterly dividend by 25 percent.

Canada’s third-largest publicly traded fund management firm reported net income from continuing operations of C$49.4 million, or 54 Canadian cents a share, for the three months ended Nov. 30, up from C$20.8 million, or 23 Canadian cents a share, in the same quarter a year ago.

Analysts had expected the company, which is controlled by the Goldring family, to earn an average of 46 Canadian cents a share before exceptional items, according to Reuters Estimates.

Assets under management at Toronto-based AGF jumped 25 percent to C$53.7 billion at the end of the fourth quarter from C$42.8 billion a year ago.

Total revenue rose 25.6 percent to C$199.1 million in the quarter from C$158.5 million. Expenses increased 13.6 percent to C$111.6 million from C$98.2 million.

The higher revenue was driven by the increased sales and assets at both AGF and its AGF Trust, the company said in a conference call with investors.

The company also said it raised its quarterly dividend on class A voting common and class B non-voting shares to 25 Canadian cents a share from 20 Canadian cents a share.

Chief Financial Officer Greg Henderson said in the conference call that while market conditions are tough, given concerns over the credit crunch and a slowdown in the U.S. economy, AGF has been “sharing a message of caution but optimism” with clients.

“When this market starts to show signs it has bottomed out, it will turn very quickly,” said Henderson. “It will be tough for a little while -- cautious is the right tone -- (but) it probably gets better in the second half of the year, and that’s personally what I think we’re going to see.”

AGF’s nonvoting B shares are down about 21 percent this year as global equity markets have taken a beating. On Wednesday afternoon, AGF’s shares were down 90 Canadian cents, or 3.7 percent, at C$23.23 on the Toronto Stock Exchange.

AGF said this week that Charles Oliver and Jamie Horvat, two top-rated mutual fund managers, had quit. Reports said they had joined competitor Sprott Asset Management.

$1=$0.99 Canadian Reporting by Frank Pingue and Leah Schnurr; editing by Rob Wilson

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