Legg Mason announces profit surge

Legg Mason has announced a 575 per cent surge in third quarter earnings following the sale of its brokerage and capital-markets operations.

The fifth-largest US money manager said net income in the final three months of 2005 rose to $760.3 million compared to just $112.7 million in the same period a year earlier.

The Baltimore-base company closed in on competitors such as Fidelity Investment and Vanguard Group after more than doubling its assets to $850.8 billion, including a $643.4 million gain from its sales to Citigroup.

Chairman and CEO Raymond 'Chip' Mason in a statement: "The acquisitions of the Citigroup Asset Management and Permal businesses enabled us to virtually double our assets under management while substantially increasing our global footprint."

The divestiture of our brokerage business, while certainly difficult on a personal level, enables us to focus solely on making Legg Mason, now one of the largest asset managers in the world, hopefully one of the most highly regarded asset managers in the world.

For the nine months ending the final day of 2005, Legg Mason's operating revenues from continuing operations totalled $1.6 billion, up 41 per cent from $1.1 billion in the prior year period.

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