SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
Pursuant to Rule 13a-16 or 15d-16 Under
the Securities Exchange Act of 1934
For the month of April, 2005
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Commission File Number 001-13908
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AMVESCAP PLC
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(Translation of registrant's name into English)
30 Finsbury Square, London EC2A 1AG, ENGLAND
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(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports
under cover Form 20-F or Form 40-F.
Form 20-F X Form 40-F
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Indicate by check mark if the registrant is submitting the Form 6-K in paper as
permitted by Regulation S-T Rule 101(b)(1):
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Indicate by check mark if the registrant is submitting the Form 6-K in paper as
permitted by Regulation S-T Rule 101(b)(7):
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Indicate by check mark whether by furnishing the information contained in this
Form, the registrant is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes No X
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If "Yes" is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b): 82- N/A
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Description of document filed: AMVESCAP PLC REPORTS RESULTS FOR THREE MONTHS
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ENDED MARCH 31 2005
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For Immediate Release
Contact: James Robertson
Phone: 404-724-4246
Contact: Angus Maitland
Phone: (44) 0207-379-5151
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AMVESCAP PLC Reports Results
for Three months Ended March 31, 2005
London, April 26, 2005 - AMVESCAP reported that profit before tax for the three
months ended March 31, 2005 amounted to (pound)59.1 million ($111.7 million)
compared to (pound)73.6 million ($135.4 million) for the first quarter of 2004,
which included a gain of (pound)6.4 million from the sale of a business.
Revenues totaled (pound)286.0 million ($540.5 million) for the first quarter of
2005, compared to (pound)288.3 million ($530.5 million) in 2004. Diluted
earnings per share amounted to 4.7p for the 2005 period, compared to 5.9p for
2004's first quarter. (NYSE: AVZ).
----------------------------------------------------------------------------------------------------------------------------
Results for Three Months Ended March 31,
2005 2004+/- 2005++ 2004++
-------------- --------------- -------------- ---------------
Revenues (pound)286.0m (pound)288.3m $540.5m $530.5m
Profit before tax (pound)59.1m (pound)73.6m $111.7m $135.4m
Earnings per share:
--basic 4.8p 5.9p $0.18+ $0.22+
--diluted 4.7p 5.9p $0.18+ $0.22+
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+/-2004 results have been restated in accordance with International Financial
Reporting Standards ("IFRS"). See Note 8 for a reconciliation of AMVESCAP's
U.K. GAAP results to IFRS.
+ Per American Depositary Share equivalent to 2 ordinary shares.
++ For the convenience of the reader, pounds sterling for the three months ended
March 31, 2005 have been translated to US dollars using $1.89 per (pound)1.00
(2004: $1.84 per (pound)1.00). References to "$" in this release are to U.S.
dollars unless otherwise indicated.
"AMVESCAP's businesses in the U.K. and Canada continue to show good results, as
we concentrate our efforts on meeting the challenges that remain in our U.S.
businesses," said Mr. Charles W. Brady, Executive Chairman. "At a time of weak
markets, AMVESCAP made progress increasing gross sales and reducing net
redemptions from the prior quarter, and last week's announcement of the sale of
our retirement business illustrates how we are sharpening our focus on those
areas of asset management where we have the greatest opportunity to excel."
Effective January 1, 2005, AMVESCAP began recording its results of operations
under International Financial Reporting Standards ("IFRS"). Prior to this date,
AMVESCAP prepared its consolidated financial statements under U.K. Generally
Accepted Accounting Practice ("U.K. GAAP"). The most significant changes
affecting AMVESCAP's financial reporting due to the IFRS transition are:
o The cessation of goodwill amortization (IFRS 3) and redenomination of goodwill
to the currency of the underlying acquired entities (IAS 21)
o The inclusion of a fair value charge in respect of outstanding employee share
options granted after November 7, 2002 (IFRS 2)
o The replacement of existing charges for awards under certain equity-based
compensation plans with fair value charges spread over revised time periods
(IFRS 2)
o The inclusion in the balance sheet of all employee benefit liabilities
(IAS 19)
The underlying business transactions and cashflows of AMVESCAP did not change
upon transition to IFRS. The transition to IFRS resulted in the reduction of
total shareholders' funds under UK GAAP at January 1, 2004 (transition date) of
(pound)118 million. This reduction is due primarily to the redenomination of
goodwill and management contract intangible assets into the currency of the
underlying acquired entities. Under U.K. GAAP, these balances were recorded in
pounds sterling. For the year ended December 31, 2004, the transition to IFRS
resulted in the addition of (pound)154 million to profit for the year, primarily
due to the amortization of goodwill previously recorded under U.K. GAAP being
credited into income. Diluted earnings per share for the quarter ended March 31,
2004 was 5.9p under IFRS, compared with 1.1p under U.K. GAAP. Diluted earnings
per share under U.K. GAAP before goodwill amortization was 5.8p for the quarter
ended March 31, 2004. See Note 8 for further details.
AMVESCAP's first Annual Report under IFRS will be for the year ended December
31, 2005. The information presented in this earnings release is subject to the
ongoing development of IFRS.
Funds under management totaled $375.4 billion at March 31, 2005, compared to
$382.1 billion at December 31, 2004. Institutional money market funds, included
above, amounted to $40.7 billion at March 31, 2005, compared to $41.7 billion at
December 31, 2004. Average funds under management amounted to $377.4 billion for
the first quarter of 2005 compared to $376.3 billion for the first quarter of
2004 and $374.0 billion for the fourth quarter of 2004. Approximately 54% the
total funds under management were invested in equity securities, and 46% were
invested in fixed income securities at March 31, 2005. The equity securities
were invested in the following disciplines at March 31, 2005: 34% in growth, 38%
in core, and 28% in value styles (December 31, 2004: 34% in growth, 39% in core
and 27% in value styles).
Changes in funds under management during the first quarter of 2005 are as
follows:
AIM INVESCO
---------------------------------- -------------------------
(billions) Total U.S. Canada U.S. U.K. Europe/Asia PWM
------------ --------- --------- --------- ----------- ------------- ------------
Dec 31, 2004 $382.1 $137.6 $34.6 $121.0 $49.6 $24.1 $15.2
Market gains/(losses) (1.4) (1.8) 0.3 (0.9) 0.8 0.4 (0.2)
Net new/(lost)
business (2.5) (2.9) 0.4 (2.0) 2.2 (0.2) (0.0)
Change in money
market funds (1.9) (1.9) -- -- -- -- --
Foreign currency (0.9) -- 0.6 (0.1) (1.0) (0.4) --
------------ --------- --------- --------- ----------- -------------- -----------
March 31, 2005 $375.4 $131.0 $35.9 $118.0 $51.6 $23.9 $15.0
============ ========= ========= ========= =========== ============== ===========
March 31, 2005 + (pound)198.6 (pound)69.3 (pound)19.0 (pound)62.4 (pound)27.3 (pound)12.7 (pound)7.9
============ ========= ========= ========= =========== ============== ===========
+ Translated at $1.89 per (pound)1.00.
Earnings before interest, taxes, depreciation, amortization and share-based
payment ("EBITDA") amounted to (pound)88.8 million ($167.8 million) in the three
months ended March 31, 2005, compared to (pound)100.8 million ($185.5 million)
for the first quarter of 2004. Net debt at March 31, 2005 amounted to
(pound)555.7million compared to (pound)590.9 million at the end of 2004,
excluding client cash.
AMVESCAP is a leading independent global investment manager dedicated to helping
people worldwide build their financial security. Operating under the AIM, AIM
Trimark, INVESCO, INVESCO Perpetual and Atlantic Trust brands, AMVESCAP strives
to deliver outstanding products and services through a comprehensive array of
retail and institutional products for clients around the world. The Company is
listed on the London, New York and Toronto stock exchanges with the symbol
"AVZ." Additional information is available at www.amvescap.com.
Members of the investment community and general public are invited to listen to
the conference call today, Tuesday, April 26, 2005, at 2:30 p.m. BST (9:30 a.m.
EDT), by dialing one of the following numbers: 610-769-9391 or 1-888-201-4990
for U.S. callers. An audio replay of the conference call will be available until
Tuesday, May 3, 2005, at 10:00 p.m. BST by calling 402-280-9915 or
1-800-873-1631 for U.S. callers. The presentation slides that will be reviewed
during the conference call will be available on AMVESCAP's Web site at
www.amvescap.com.
# # #
This release may include statements that constitute "forward-looking statements"
under the United States securities laws. Forward-looking statements include
information concerning possible or assumed future results of our operations,
earnings, liquidity, cash flow and capital expenditures, industry or market
conditions, assets under management, acquisition activities and the effect of
completed acquisitions, debt levels and the ability to obtain additional
financing or make payments on our debt, regulatory developments, demand for and
pricing of our products and other aspects of our business or general economic
conditions. In addition, when used in this report, words such as "believes,"
"expects," "anticipates," "intends," "plans," "estimates," "projects" and future
or conditional verbs such as "will," "may," "could," "should," and "would" or
any other statement that necessarily depends on future events, are intended to
identify forward-looking statements.
Forward-looking statements are not guarantees of performance. They involve
risks, uncertainties and assumptions. Although we make such statements based on
assumptions that we believe to be reasonable, there can be no assurance that
actual results will not differ materially from our expectations. We caution
investors not to rely unduly on any forward-looking statements. In connection
with any forward-looking statements, you should carefully consider the areas of
risk described in our most recent Annual Report on Form 20-F, as filed with the
United States Securities and Exchange Commission (SEC). You may obtain these
reports from the SEC's Web site at www.sec.gov.
AMVESCAP PLC
Consolidated Income Statement
(in thousands)
Three Months Ended March 31,
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2005 2004
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Revenues (pound)285,984 (pound)288,284
Operating expenses (217,158) (214,043)
---------------- ----------------
Operating profit 68,826 74,241
Investment income 1,408 9,045
Interest expense (11,159) (9,698)
---------------- ----------------
Profit before taxation 59,075 73,588
Taxation (21,110) (26,100)
---------------- ----------------
Profit after taxation 37,965 47,488
Minority interests (78) (84)
---------------- ----------------
Profit for the period attributable to
equity holders of the parent (pound)37,887 (pound)47,404
================ ================
Earnings per share:
---basic 4.8p 5.9p
---diluted 4.7p 5.9p
---------------- ----------------
Average shares outstanding:
---basic 793,434 802,353
---diluted 800,668 809,767
---------------- ----------------
AMVESCAP PLC
Consolidated Balance Sheet
(in thousands)
March 31, 2005 Dec 31, 2004
-------------------- ---------------------
Non-current assets
Goodwill and intangible assets (pound)2,364,733 (pound)2,317,247
Property and equipment 115,314 118,272
Investments 90,838 70,070
-------------------- ---------------------
2,570,885 2,505,589
Currents assets
Trade and other receivables 1,073,973 1,021,076
Investments 76,650 84,483
Cash and cash equivalents 242,592 284,977
-------------------- ---------------------
1,393,215 1,390,536
Total assets 3,964,100 3,896,125
-------------------- ---------------------
Current liabilities
Current maturities of long-term debt (42,471) (41,411)
Trade and other payables (1,204,913) (1,196,981)
-------------------- ---------------------
(1,247,384) (1,238,392)
Net current assets 145,831 152,144
-------------------- ---------------------
Non-current liabilities
Long-term debt (644,041) (683,215)
Provisions for liabilities and charges (121,704) (124,793)
-------------------- ---------------------
Total liabilities (2,013,129) (2,046,400)
-------------------- ---------------------
Net assets (pound)1,950,971 (pound)1,849,725
==================== =====================
Equity
Share capital (pound)202,790 (pound)202,664
Share premium 702,419 700,888
Shares held by employee trusts (237,972) (237,972)
Exchangeable shares 308,996 308,996
Retained earnings 308,993 271,106
Other reserves 664,358 602,729
-------------------- ---------------------
Equity attributable to equity holders of the
parent 1,949,584 1,848,411
Minority interests 1,387 1,314
-------------------- ---------------------
Total equity (pound)1,950,971 (pound)1,849,725
==================== =====================
AMVESCAP plc
Consolidated Cash Flow Statement
(in thousands)
Three Months Ended March 31,
--------------------------------------
2005 2004
---------------- -----------------
Operating profit (pound)68,826 (pound)74,241
Amortization and depreciation 11,147 12,371
Interest paid, net of investment income (10,445) (9,498)
Taxation (11,522) (8,152)
Change in debtors, creditors, and other (45,070) (85,333)
---------------- -----------------
Net cash inflow/(outflow) from operating activities 12,936 (16,371)
Investing activities:
Capital expenditures, net of sales (4,340) (7,889)
(Purchase)/disposals of fixed asset investments, net (2,409) 1,173
Acquisitions and dispositions -- (28,195)
Financing (56,476) (10,047)
---------------- -----------------
Decrease in cash and cash equivalents (50,289) (61,329)
Foreign exchange 7,904 (6,128)
Cash and cash equivalents, beginning of period 284,977 318,713
---------------- -----------------
Cash and cash equivalents, end of period (pound)242,592 (pound)251,256
================ =================
AMVESCAP PLC
Segmental Information
(in thousands)
Three Months Ended March 31, 2005
Operating
Revenues Expenses Profit
---------------- -------------------- --------------
AIM
U.S. (pound)100,578 (pound)(65,725) (pound)34,853
Canada 47,124 (20,955) 26,169
---------------- -------------------- --------------
147,702 (86,680) 61,022
---------------- -------------------- --------------
INVESCO
U.S. 50,084 (38,568) 11,516
U.K. 52,733 (45,376) 7,357
Europe/Asia 15,938 (16,571) (633)
---------------- -------------------- --------------
118,755 (100,515) 18,240
---------------- -------------------- --------------
Private Wealth/Retirement 19,527 (21,606) (2,079)
---------------- -------------------- --------------
285,984 (208,801) 77,183
Corporate -- (8,357) (8,357)
---------------- -------------------- --------------
(pound)285,984 (pound)(217,158) (pound)68,826
================ ==================== ==============
Three Months Ended March 31, 2004
Operating
Revenues Expenses Profit
---------------- -------------------- --------------
AIM
U.S. (pound)114,035 (pound)(70,324) (pound)43,711
Canada 41,817 (20,656) 21,161
---------------- -------------------- --------------
155,852 (90,980) 64,872
---------------- -------------------- --------------
INVESCO
U.S. 47,368 (33,774) 13,594
U.K. 46,107 (40,584) 5,523
Europe/Asia 19,786 (20,102) (316)
---------------- -------------------- --------------
113,261 (94,460) 18,801
---------------- -------------------- --------------
Private Wealth/Retirement 19,171 (20,145) (974)
---------------- -------------------- --------------
288,284 (205,585) 82,699
Corporate -- (8,458) (8,458)
---------------- -------------------- --------------
(pound)288,284 (pound)(214,043) (pound)74,241
================ ==================== ==============
Notes
1. Accounting policies
The accounting policies used in the preparation of the earnings release
follow International Financial Reporting Standards ("IFRS") in effect as of
the date of this release. The comparative period has been restated to apply
these IFRS on a consistent basis (see Note 8). The most significant changes
due to the IFRS transition are:
o The cessation of goodwill amortization (IFRS 3) and redenomination of
goodwill to the currency of the underlying acquired entities (IAS 21)
o The inclusion of a fair value charge in respect of outstanding
employee share options granted after November 7, 2002 (IFRS 2)
o The replacement of existing charges for awards under certain
equity-based compensation plans with fair value charges spread over
revised time periods (IFRS 2)
o The inclusion in the balance sheet of all employee benefit liabilities
(IAS 19)
2. Adoption of accounting standards
The Group has adopted IAS 32, "Financial Instruments: Disclosure and
Presentation" and IAS 39, "Financial Instruments: Recognition and
Measurement" as of January 1, 2005. These standards require that financial
assets and liabilities be recognized on the balance sheet and accounted for
according to their underlying classification. Shareholders equity increased
by (pound)15.2 million as a result of these changes primarily arising from
the recognition of net unrealized gains on investments classified as
available for sale.
3. Taxation
The taxation charge is primarily due to overseas taxation. A significant
proportion of the tax charge is expected to arise from U.S. operations. The
estimated effective tax rate is 35.7% in 2005 (2004: 35.5%).
4. Earnings per share
Basic earnings per share is based on the weighted average number of
ordinary and exchangeable shares outstanding during the respective periods
excluding shares purchased and held by employee share ownership trusts.
Diluted earnings per share takes into account the effect of the potential
issuance ordinary shares.
2005
---------------------------------------------------------------
Profit for the period Number of shares
Per share
(pound)'000 '000 amount
----------------------- -------------------- ----------------
Basic earnings per share 37,887 793,434 4.8p
================
Dilutive effect of share-based awards -- 7,234
----------------------- --------------------
Diluted earnings per share 37,887 800,668 4.7p
======================= ==================== ================
2004
---------------------------------------------------------------
Profit for the period Number of shares
Per share
(pound)'000 '000 amount
----------------------- -------------------- ----------------
Basic earnings per share 47,404 802,353 5.9p
================
Dilutive effect of share-based awards -- 7,414
----------------------- --------------------
Diluted earnings per share 47,404 809,767 5.9p
======================= ==================== ================
5. Dividends
A final dividend in respect of the 2004 year of (pound)40,978,000 (5.0p per
share) will be proposed at the Annual General Meeting of Shareholders to be
held on April 28, 2005. If approved, this dividend will be accrued on that
date and will be paid on May 4, 2005, to shareholders on the register on
April 1, 2005.
6. Credit facility
On March 31, 2005, the Company entered into a new five-year credit
agreement ("credit facility") with a group of lenders, providing a
revolving credit facility in an aggregate principal amount of up to $900
million. Under certain conditions, the aggregate commitments under the
credit facility may be increased to $1.2 billion. The credit facility
requires specified financial ratios to be maintained, including maximum
debt to earnings and minimum interest coverage.
7. Sale of business
On April 21, 2005 the sale of the AMVESCAP Retirement division was
announced. The transaction is expected to close during the second half of
the year.
8. Reconciliations from U.K. GAAP to IFRS
Prior to December 31, 2004, AMVESCAP reported its results of operations
under U.K. Generally Accepted Accounting Practice ("U.K. GAAP"). Beginning
January 1, 2005, AMVESCAP transitioned from U.K. GAAP to International
Financial Reporting Standards ("IFRS"). The tables below reconcile total
shareholders' funds at December 31, 2003, and December 31, 2004 under U.K.
GAAP to total equity under IFRS, and profit/(loss) after taxation for the
three months ended March 31, 2004 and the year ended December 31, 2004 from
U.K. GAAP to IFRS. Amounts are presented in millions.
Reconciliation of total U.K. GAAP total shareholders' funds to IFRS total
equity
Dec 31, 2003 Dec 31, 2004
------------------- -------------------
U.K. GAAP total shareholders' funds (pound)2,065 (pound)1,864
IFRS Transition Adjustments:
Goodwill and intangibles (130) (16)
Shared based payment (7) (7)
Defined benefit obligation, net (31) (30)
Dividends 53 41
Other (3) (2)
------------------- -------------------
IFRS total equity (pound)1,947 (pound)1,850
=================== ===================
Reconciliation of U.K. GAAP profit/(loss) after taxation to IFRS profit/
(loss) after taxation
Three months ended Year ended
March 31, 2004 Dec 31, 2004
---------------------- ------------------
U.K. GAAP profit/(loss) after taxation (pound)9 (pound)(173)
IFRS Transition Adjustments:
Goodwill and intangibles 37 153
Defined benefit obligation, net 1 --
Sale of business 3 3
Other (3) (2)
---------------------- ------------------
IFRS profit/(loss) after taxation (pound)47 (pound)(19)
====================== ==================
IFRS Transition Adjustments:
Goodwill and intangibles. The Group has chosen to apply IFRS 3
prospectively from the date of transition. This has resulted in the value
of goodwill arising from previous acquisitions being frozen at the value
held on the Group balance sheet at January 1, 2004 and the reversal of any
amortization charged in 2004. The Group has elected to apply IAS 21
retrospectively to its goodwill and intangible asset balances, which were
previously recorded in pounds sterling from their respective acquisition
dates. The result of this application is that the goodwill and intangible
assets have been redenominated into their underlying currencies and will
subsequently be re-measured each reporting date for the effect of changes
in foreign exchange rates.
Share-based payment. The Group will recognize a charge in the Profit and
Loss Account for the fair value of outstanding share awards granted to
employees after November 7, 2002. The charge has been calculated using a
stochastic option valuation model and will be charged over the relevant
vesting periods, adjusted to reflect expected and actual levels of vesting.
Defined benefit obligation, net. The Group will recognize the net liability
for defined benefit post retirement plan schemes on the balance sheet and
will take actuarial gains and losses on a systematic basis to the Profit
and Loss Account, in accordance with the permitted methods of recognition
under IAS 19.
Sale of business. During 2004, the Group disposed of its U.K. and Jersey
businesses of Atlantic Wealth Management and included the previously
written off goodwill related to this business in the calculation of the net
gain resulting from the sale. Under IFRS 1 goodwill previously deducted
from equity is not recognized in the opening balance sheet and that
goodwill is not transferred into the Profit and Loss Account upon disposal
of the business. This had the effect of increasing the gain reported under
U.K. GAAP.
Dividends. The Group will recognize dividends declared after the balance
sheet date in the reporting period in which they are declared, as they
represent non-adjusting events after the balance sheet date.
Other. Other adjustments upon transition to IFRS include the recognition
and establishment of accruals related to compensated absences, foreign
exchange items and certain tax adjustments.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
AMVESCAP PLC
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(Registrant)
Date 26 April, 2005 By /s/ Michael S. Perman
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(Signature)
Michael S. Perman
Company Secretary