Legg Mason today reported $950.1 billion in assets under management as of March 31, down 4.8% from the prior quarter and off 1.9% from the year before. On an earnings conference call, company officials said market depreciation lowered AUM by $28.5 billion during the quarter, while net client outflows came to $19 billion. A company news release said equity outflows of $17 billion and fixed-income outflows of $7 billion were only partially offset by liquidity inflows of $5 billion.
For the quarter, Legg Mason reported a net loss of $255.5 million, its first as a publicly traded company. It posted a $154.6 million profit for the quarter ended Dec. 31, and a $172.5 million profit for the year-earlier quarter. The loss resulted from non-cash charges, including an after-tax charge of $291 million to support the firms money market funds. The $1.81 per share loss exceeded analysts consensus estimate of a 27-cent loss, sending Legg Masons shares down more than 5% in morning trading.
Operating revenues for the quarter came to $1.069 billion, down 9.9% from the prior quarter and down 6.4% from the year before.
Company officials also announced plans to raise $1 billion by issuing mandatory convertible securities, Legg Masons second effort to raise capital this year. They said the funds would provide the firm with an extra margin of safety, which could be used for further money market fund support, if needed, or other purposes, such as acquisitions. On the conference call, President and CEO Mark R. Fetting expressed disappointment with Legg Masons difficult results in a difficult environment, while adding he was gratified to see some daylight on the horizon in terms of improvements in capital markets and sentiment since the start of April.