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Legg Mason earnings set record for 3rd year in row


Consistent with the strong results being reported by other brokerage firms, Legg Mason Inc. disclosed record earnings yesterday for its 1992 fiscal year and its most recent quarter.

The company earned $21.1 million, or $2.32 a share, for the year that ended March 31.

Profits were up 56 percent, led by large gains in commission revenue stemming from the surging stock market and good gains in investment banking income that benefited from a healthy increase in municipal underwriting. Among the issues in which Legg Mason participated were securities to finance the construction of Oriole Park at Camden Yards.

It marked the third consecutive year of record profits for Legg Mason, stretching across a volatile period in which many other securities firms suffered badly.

"We were pleased that we made money last year even when the industry as a whole lost money and pleased this year to turn in a better performance in what has been a good year for the industry overall," said Vice Chairman John Curley.

Chief Executive Raymond A. "Chip" Mason attributed the surge in income to continuing cost controls in brokerage operations along with revenue growth in other key divisions, including investment management.

"Firms have been reporting terrific numbers, and Legg is a little steadier than most," said James Hanbury, an analyst with Wertheim Schroder, "but it's in line with what's going on in the industry, and it's very good."

Despite the results, Legg Mason's stock yesterday fell 62.5 cents, to $22.50, yesterday, a decline echoed by the share prices of many other major brokerage firms.

"The better the numbers have been, the more the stocks have been off," Mr. Hanbury said. "We're kind of late in the economic cycle for brokers. They do better when the economy is weak, and interest rates are low."

Most of the major trends bolstering profits for the year were particularly vivid in the final quarter. Commission revenue rose almost 30 percent, and investment banking

revenues almost doubled. Among expenses, brokerage and clearing fees declined, reflecting the company's effort to process its own transaction.

Three months ended 3/31/92

.. .. ..Revenue.. .. .. .. Net.. .. .. .. .. .. Share

'92.. ..79,755,000.. .. .. ..6,619,000.. .. .. .. ..0.66

'91.. ..67,056,000.. .. .. ..4,162,000.. .. .. .. ..0.43

% change .. ..+18.9.. .. .. .. .. +59.0.. .. .. .. ..+53.5

Twelve months ended 03/31/92

.. .. ..Revenue.. .. .. .. .Net.. .. .. .. .. .. Share

'92.. ..292,356,000.. .. .. 21,117,000.. .. .. .. .. 2.13

'91.. ..251,021,000.. .. .. 13,524,000.. .. .. .. .. 1.43

% change.. .. +16.5.. .. .. .. ..+56.1.. .. .. .. ..+49.0

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