A big demand for stocks by the public fueled a 198 percent increase in Legg Mason Inc.'s earnings, the company said yesterday.
The Baltimore-based brokerage and investment advisory firm earned $9.2 million in the second quarter, and $17.1 million for the first six months of the year, marking an 111 percent increase from a year ago.
Revenues were up 36 percent to nearly $120 million in the second quarter, and earnings per share grew 168 percent to 67 cents.
"It should certainly be a very a good year for us," said F. Barry Bilson, the company's chief financial officer.
Mr. Bilson said earnings grew because people are optimistic about the economy and they are putting their funds into the stock market.
"You are dealing with record [stock] volumes in contrast to last year," he said.
"Last year was a soft environment, especially in retail brokerage."
On Tuesday, James W. Brinkley, president of Legg Mason subsidiary, Legg Mason Wood Walker Inc., said he expects the market to decline because it hasn't had a correction of at least 10 percent in four years.
While Mr. Brinkley doesn't see a large correction, or one in the 10 percent range, he is preparing for some bumps.
And a soft market like the one stockbrokers saw last year would xTC surely dampen future earnings.
Legg Mason's brokers have been plenty busy this year as the company's retail brokerage and investment advisory businesses chalked up huge gains in the quarter and for the first half of the fiscal year.
Commission revenues from Legg Mason's retail brokerage business jumped 40 percent in the quarter, to $41.1 million, and they were up 33 percent, to $78 million, for the first six months of the year.