SEC Filing

SEI Investments Company

Date: July 24, 2008

/s/ Dennis J. McGonigle

Dennis J. McGonigle

Chief Financial Officer

SEI

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SEI Investments Co--Form 8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

July 24, 2008

Date of report (Date of earliest event reported)

SEI Investments Company

(Exact name of registrant as specified in its charter)

Pennsylvania

0-10200

23-1707341

(State or other jurisdiction

of incorporation)

(Commission File No.)

(I.R.S. Employer

Identification No.)

1 Freedom Valley Drive

Oaks, Pennsylvania 19456

(Address of principal executive offices) (Zip Code)

(610) 676-1000

(Registrants’ telephone number, including area code)

Not applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02.

Results of Operations and Financial Condition.

On Wednesday, July 23, 2008, SEI Investments Company issued a press release announcing its financial and operating results for the second quarter ended June 30, 2008. A copy of the press release is furnished as Exhibit 99.1 and incorporated in this Item 2.02 by reference.

As provided in General Instruction B.2 to Form 8-K, the information furnished in this Item 2.02, and Exhibit 99.1 hereto shall not be deemed “filed” for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing with the Securities and Exchange Commission, except as shall be expressly provided by specific reference in such filing.

Item 9.01.

Financial Statements and Exhibits.

(d)

Exhibits.


99.1		Press Release dated July 23, 2008 of SEI Investments Company related to the Company’s financial and operating results for the second quarter ended June 30, 2008.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

EXHIBIT INDEX


Exhibit Number		Description
99.1		Press Release dated July 23, 2008 of SEI Investments Company related to the Company’s financial and operating results for the second quarter ended June 30, 2008.

Press Release

Exhibit 99.1

NEWS FROM SEI

For Immediate Release


Contact:	Larry Wexler, Corp Comm	Murray Louis, VP	Dana Grosser, Corp PR

Voice:	610.676.1440	610.676.1932	610.676.2459

E-mail	lwexler@seic.com	mlouis@seic.com	dgrosser@seic.com

Pages:	Eight

SEI Reports Second-Quarter 2008 Results

Revenues down 4%, Net Income down 34%

OAKS, Pa., July 23, 2008 — SEI Investments Company (NASDAQ:SEIC) today announced financial results for second-quarter 2008, reporting decreases in revenues, net income and earnings per share compared to second-quarter 2007. Net income during the second-quarter was negatively affected by a $27.3 million non-cash pre-tax charge (approximately $.09 per share post-tax). This charge is related to previously-disclosed support agreements covering holdings of structured investment products by SEI-sponsored money market funds. This current period charge increases the total accrual for these support agreements to $78.2 million.

Consolidated Overview

(In thousands, except earnings per share)


	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2008		2007		%		2008		2007		%
Revenues	$	329,523	$	343,258	(4	)%	$	663,431	$	665,983	—
Net Income Before Taxes		73,385		112,102	(35	)%		151,192		213,021	(29	)%
Net Income		46,164		69,501	(34	)%		95,110		132,878	(28	)%
Diluted Earnings Per Share	$	.24	$	.34	(29	)%	$	.48	$	.65	(26	)%

“We continue to make progress, even in the face of difficulties created by the capital and credit markets,” said Alfred P. West, Jr., SEI Chairman and CEO.

“We generated good sales across our core businesses, realized further acceptance of our new strategies, continued to operate and expand our Global Wealth Platform, and made good progress on our other key investments. The current market environment will make growth in revenues and profits, in the short-term, challenging. In the long run, we remain firm in our belief that what we are doing will provide our clients with increased opportunities for success and allow us to grow our future revenues and profits.”

Summary of Second-Quarter and Year to Date Results by Business Segment

(In thousands)


	For the Three Month Period Ended June 30,								For the Six Month Period Ended June 30,
	2008			2007			%		2008			2007			%
Private Banks:
Revenues	$	103,602		$	100,090		4	%	$	210,656		$	197,828		6	%
Expenses		85,367			80,829		6	%		171,534			158,822		8	%

Operating Profit	$	18,235		$	19,261		(5	)%	$	39,122		$	39,006		—
Operating Margin		18	%		19	%				19	%		20	%

Investment Advisors:
Revenues		61,848			65,446		(5	)%		122,367			127,009		(4	)%
Expenses		31,551			30,919		2	%		62,927			60,293		4	%

Operating Profit		30,297			34,527		(12	)%		59,440			66,716		(11	)%
Operating Margin		49	%		53	%				49	%		53	%

Institutional Investors:
Revenues		51,300			48,911		5	%		101,989			95,540		7	%
Expenses		29,328			30,181		(3	)%		59,468			58,354		2	%

Operating Profit		21,972			18,730		17	%		42,521			37,186		14	%
Operating Margin		43	%		38	%				42	%		39	%

Investment Managers:
Revenues		37,307			35,293		6	%		73,800			69,287		7	%
Expenses		25,012			24,302		3	%		50,976			49,204		4	%

Operating Profit		12,295			10,991		12	%		22,824			20,083		14	%
Operating Margin		33	%		31	%				31	%		29	%

Investments in New Businesses:
Revenues		1,864			1,836		2	%		3,698			3,466		7	%
Expenses		4,147			4,725		(12	)%		8,799			9,577		(8	)%

Operating Loss		(2,283	)		(2,889	)	21	%		(5,101	)		(6,111	)	17	%
Operating Margin		n/a			n/a					n/a			n/a

LSV:
Revenues		73,602			91,682		(20	)%		150,921			172,853		(13	)%
Expenses (1)		45,840			56,262		(19	)%		93,196			106,159		(12	)%

Operating profit		27,762			35,420		(22	)%		57,725			66,694		(13	)%
Operating Margin		38	%		39	%				38	%		39	%

Consolidated Segment Totals:
Revenues	$	329,523		$	343,258		(4	)%	$	663,431		$	665,983		—
Expenses		221,245			227,218		(3	)%		446,900			442,409		1	%

Operating Profit	$	108,278		$	116,040		(7	)%	$	216,531		$	223,574		(3	)%
Operating Margin		33	%		34	%				33	%		34	%

(1)	Includes $38,072 and $48,861 for the three month period ended June 30, 2008 and 2007, respectively, and $79,310 and $91,533 for the six month period ended June 30, 2008 and 2007, respectively, of minority interest to the other partners of LSV.

A reconciliation of the totals reported for the business segments to the applicable line items in the Consolidated Statements of Income for the three and six month periods ended June 30, 2008 and 2007 is as follows:


	Three Months Ended June 30,						Six Months Ended June 30,
	2008			2007			2008			2007
Total operating profit from business segments	$	108,278		$	116,040		$	216,531		$	223,574

Corporate overhead expenses		(10,347	)		(10,578	)		(20,456	)		(20,705	)
Minority interest reflected in segments		39,082			50,033			81,270			93,625
LSV Employee Group Expenses (1)		(1,819	)		(1,820	)		(3,640	)		(3,640	)

Income from operations	$	135,194		$	153,675		$	273,705		$	292,854

(1)

Includes $1,806 for the three month period ending June 30, 2008 and 2007, and $3,611 for the six month period ended June 30, 2008 and 2007 of amortization expense related to intangible assets owned by LSV Employees Group LLC. The amortization is offset through Minority interest since SEI does not have any ownership in LSV Employee Group LLC.

Second-Quarter Business Commentary:

•

The Private Banks, Institutional Investors and Investment Managers segments generated gains in second-quarter 2008 revenues versus second-quarter 2007 due to new client activity.

•

The Institutional Investors and Investment Managers segments generated gains in second-quarter 2008 operating profits versus second-quarter 2007.

•

Private Banks second-quarter 2008 operating profit was down versus second-quarter 2007 due to increased costs associated with putting the Global Wealth Platform into production and supporting operations.

•

The LSV and Investment Advisors segments were most directly affected by the weakening capital markets resulting in second-quarter 2008 revenues and operating profits declining from second-quarter 2007 levels.

•

The Global Wealth Platform was placed into service during the third-quarter 2007. Second-quarter 2008 expenses reflect an increase of approximately $3.5 million for amortization versus second-quarter 2007 levels. The amortization is primarily recognized in the Private Banks and Investment Advisors segments.

•

The company’s percentage ownership in LSV remained at approximately 43 percent. In the second-quarter 2008, the company recognized $27.8 million as its portion of the earnings from LSV versus $35.4 million in the second-quarter 2007.

•

Assets under management declined by $6.4 billion during second-quarter 2008 to $178.2 billion, primarily due to market depreciation.

•

In the second-quarter 2008, SEI purchased 1.9 million shares of its common stock for $45.5 million.

•

The second-quarter 2008 results include a $27.3 million non-cash charge related to money market funds support agreements. Additional information about the capital support agreements is contained in SEI’s 2007 Form 10-K filed February 26, 2008 and SEI’s 2008 first-quarter 10-Q filing dated May 2, 2008.

Earnings Conference Call

A conference call to review earnings is scheduled for 2:00 PM ET on July 23, 2008. Investors may listen to the call at www.seic.com (Investor Information section), or listen at www.earnings.com, a service of Thomson Streetevents. The call may also be accessed at numerous financial services web sites including AOL and Yahoo. Investors may also listen to replays at these web sites, or by telephone at (USA) 1-800-475-6701; (International) 320-365-3844, access code 953975.

About SEI

SEI (NASDAQ:SEIC) is a leading global provider of outsourced asset management, investment processing and investment operations solutions. The company’s innovative solutions help corporations, financial institutions, financial advisors, and affluent families create and manage wealth. As of June 30, 2008, through its subsidiaries and partnerships in which the company has a significant interest, SEI administers $420 billion in mutual fund and pooled assets and manages $178 billion in assets. SEI serves clients, conducts or is registered to conduct business and/or operations, from more than 20 offices in over a dozen countries. For more information, visit www.seic.com.

Many of our responses may be considered “forward looking statements” and include discussions about future operations, strategies and financial results. Forward-looking statements are based upon estimates and assumptions that involve risks and uncertainties, many of which are beyond our control or are subject to change. Although we believe our assumptions are reasonable, they could be inaccurate. Our actual future revenues and income could differ materially from our expected results. We have no obligation to publicly update or revise any forward-looking statements.

SEI INVESTMENTS COMPANY

CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share data)

(Unaudited)


	Three Months Ended June 30,
	2008			2007
Asset management, admin. and distribution fees	$	260,931		$	276,653
Information processing and software servicing fees		57,088			55,414
Transaction–based and trade execution fees		11,504			11,191

Total revenues		329,523			343,258
Commissions and fees		43,045			43,036
Compensation, benefits and other personnel		83,529			88,552
Consulting, outsourcing and professional fees		26,611			22,617
Data processing and computer related		11,229			10,227
Facilities, supplies and other costs		18,417			17,700
Depreciation and amortization		11,498			7,451

Total expenses		194,329			189,583
Income from operations		135,194			153,675
Minority interest		(36,930	)		(47,242	)
Net loss on investments (1)		(27,294	)		(997	)
Interest and dividend income		3,223			4,882
Interest expense		(808	)		(1,168	)
Other		—			2,952

Income before taxes		73,385			112,102
Income taxes		27,221			42,601

Net income	$	46,164		$	69,501

Diluted earnings per common share	$	.24		$	.34

Shares used to calculate diluted earnings per common share		195,992			203,604

Basic earnings per common share	$	.24		$	.35

Shares used to calculate basic earnings per common share		192,187			197,314

(1)	Includes $27,301 for the three month period ended June 30, 2008 of a non-cash charge related to money market funds support agreements.

SEI INVESTMENTS COMPANY

CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share data)

(Unaudited)


	Six Months Ended June 30,
	2008			2007
Asset management, admin. and distribution fees	$	520,990		$	533,051
Information processing and software servicing fees		117,227			109,646
Transaction–based and trade execution fees		25,214			23,286

Total revenues		663,431			665,983
Commissions and fees		88,340			85,673
Compensation, benefits and other personnel		167,421			172,830
Consulting, outsourcing and professional fees		53,368			43,496
Data processing and computer related		21,777			20,994
Facilities, supplies and other costs		35,802			35,260
Depreciation and amortization		23,018			14,876

Total expenses		389,726			373,129
Income from operations		273,705			292,854
Minority interest		(76,759	)		(87,976	)
Net loss on investments (1)		(51,340	)		(1,313	)
Interest and dividend income		7,361			8,933
Interest expense		(1,775	)		(2,429	)
Other		—			2,952

Income before taxes		151,192			213,021
Income taxes		56,082			80,143

Net income	$	95,110		$	132,878

Diluted earnings per common share	$	.48		$	.65

Shares used to calculate diluted earnings per common share		197,102			204,153

Basic earnings per common share	$	.49		$	.67

Shares used to calculate basic earnings per common share		192,908			197,614

(1)	Includes $53,096 for the six month period ended June 30, 2008 of a non-cash charge related to money market funds support agreements.

SEI INVESTMENTS COMPANY

CONDENSED BALANCE SHEETS

(In thousands)


	(Unaudited) June 30, 2008		December 31, 2007
Assets
Cash and short-term investments	$	320,385	$	360,921
Restricted cash		26,822		10,250
Receivables		275,492		275,109
Securities owned		11,987		16,777
Other current assets		54,563		31,877

Total current assets		689,249		694,934
Property and equipment, net		141,775		143,516
Investments available for sale		75,069		77,169
Capitalized software, net		248,939		231,684
Goodwill		22,842		22,842
Intangible assets		56,348		60,177
Other assets, net		18,260		22,043

Total assets	$	1,252,482	$	1,252,365

Liabilities
Current liabilities (1)	$	230,715	$	230,367
Long-term debt		33,819		43,971
Deferred income taxes		77,869		73,600
Long term liabilities		12,623		11,895
Minority interest		133,901		136,149
Shareholders’ Equity		763,555		756,383

Total liabilities and shareholders’ equity	$	1,252,482	$	1,252,365

(1)	Includes $78,218 and $25,122 for the period ended June 30, 2008 and December 31 2007, respectively, of an accrual related to money market funds support agreements.

SEI INVESTMENTS COMPANY

ASSET BALANCES

(In millions)

(Unaudited)


	Jun. 30, 2007		Sep. 30, 2007		Dec. 31, 2007		Mar. 31, 2008		Jun. 30, 2008
Private Banks:
Equity/Fixed Income prgms.	$	20,666	$	21,816	$	21,160	$	18,904	$	18,163
Collective Trust Fund prgm.		1,078		1,056		1,007		1,008		955
Liquidity funds		8,224		8,836		8,886		9,198		8,345

Total assets under mgmt.	$	29,968	$	31,708	$	31,053	$	29,110	$	27,463

Client assets under admin.		15,019		15,655		14,235		13,897		13,242

Total assets	$	44,987	$	47,363	$	45,288	$	43,007	$	40,705

Investment Advisors:
Equity/Fixed Income prgms.	$	36,923	$	37,751	$	36,378	$	32,736	$	31,938
Collective Trust Fund prgm.		2,334		2,325		2,295		2,310		2,259
Liquidity funds		1,400		1,619		2,079		2,461		2,410

Total assets under mgmt.	$	40,657	$	41,695	$	40,752	$	37,507	$	36,607

Institutional Investors:
Equity/Fixed Income prgms.	$	40,771	$	43,504	$	44,833	$	43,134	$	43,608
Collective Trust Fund prgm.		895		907		897		924		947
Liquidity funds		4,128		4,342		3,629		4,077		3,950

Total assets under mgmt.	$	45,794	$	48,753	$	49,359	$	48,135	$	48,505

Investment Managers:
Equity/Fixed Income prgms.	$	32	$	24	$	24	$	20	$	19
Collective Trust Fund prgm.		7,990		6,814		6,651		6,571		6,572
Liquidity funds		271		360		325		571		438

Total assets under mgmt.	$	8,293	$	7,198	$	7,000	$	7,162	$	7,029

Client assets under admin.		192,931		205,251		215,124		225,005		228,722

Total assets	$	201,224	$	212,449	$	222,124	$	232,167	$	235,751

Investments in New Businesses:
Equity/Fixed Income prgms.	$	887	$	907	$	929	$	869	$	838
Liquidity funds		43		40		74		77		98

Total assets under mgmt.	$	930	$	947	$	1,003	$	946	$	936

LSV Asset Management
Equity/Fixed Income prgms.	$	73,100	$	71,349	$	67,599	$	61,765	$	57,692

Consolidated:
Equity/Fixed Income prgms (A)	$	172,379	$	175,351	$	170,923	$	157,428	$	152,258
Collective Trust Fund prgm.		12,297		11,102		10,850		10,813		10,733
Liquidity funds		14,066		15,197		14,993		16,384		15,241

Total assets under mgmt.	$	198,742	$	201,650	$	196,766	$	184,625	$	178,232

Client assets under admin. (B)		207,950		220,906		229,359		238,902		241,964

Total assets	$	406,692	$	422,556	$	426,125	$	423,527	$	420,196

(A)	Equity/Fixed Income programs include $3,146 of assets invested in various asset allocation funds at June 30, 2008.

(B)	In addition to the numbers presented, SEI also administers an additional $6,678 in Funds of Funds assets (as of June 30, 2008) on which SEI does not earn an administration fee.