SEC Filing

SEI Investments Company

Date: January 25, 2012

/s/ Dennis J. McGonigle

Dennis J. McGonigle

Chief Financial Officer

SEI

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SEI Investments Company--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

January 25, 2012

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, January 25, 2012, SEI Investments Company issued a press release announcing its financial and operating results for the fourth quarter ended December 31, 2011. 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 January 25, 2012 of SEI Investments Company related to the Company’s financial and operating results for the fourth quarter ended December 31, 2011.

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 January 25, 2012 of SEI Investments Company related to the Company’s financial and operating results for the fourth quarter ended December 31, 2011.

Press Release

Exhibit 99.1

NEWS FROM SEI


Investor Contact:		Media Contact:
Murray Louis		Dana Grosser
SEI		SEI
(610) 676-1932		(610) 676-2459
mlouis@seic.com		dgrosser@seic.com
Pages: 9

FOR IMMEDIATE RELEASE

SEI REPORTS FOURTH-QUARTER 2011 FINANCIAL RESULTS

OAKS, Pa., January 25, 2012 — SEI Investments Company (NASDAQ:SEIC) today announced financial results for fourth-quarter 2011. Diluted earnings per share were $.25 in fourth-quarter 2011 compared to $.33 in fourth-quarter 2010.


Consolidated Overview (In thousands, except earnings per share)	For the Three Months Ended December 31,							For the Twelve Months Ended December 31,
	2011		2010		%			2011		2010		%

Revenues	$	226,247	$	231,399		(2	%)	$	929,727	$	900,835		3	%
Net Income attributable to SEI		44,396		62,400		(29	%)		204,959		231,687		(12	%)
Diluted Earnings Per Share	$	0.25	$	0.33		(24	%)	$	1.11	$	1.22		(9	%)

“While the headwinds created by third-quarter 2011 market performance had a dampening effect on fourth-quarter results, we continued to make progress in our business development initiatives that will drive long-term growth,” said Alfred P. West, Jr., SEI Chairman and CEO.

“As we enter 2012, we continue to operate in challenging and dynamic markets. We are confident that the solutions we offer and the investments we have made will allow us to succeed in growing our company. In the short-term, we will continue to focus on improving productivity, maintaining a strong and talented workforce and producing strong sales results. In the long-term increasing shareholder value, through strong profit growth, remains our number one goal.”

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


(In thousands)	For the Three Month Period Ended December 31,									For the Twelve Month Period Ended December 31,
	2011			2010			%			2011			2010			%
Private Banks:
Revenues	$	85,843		$	85,938			0	%	$	348,122		$	346,668			0	%
Expenses		84,769			80,959			5	%		339,339			310,633			9	%

Operating Profit	$	1,074		$	4,979			(78	%)	$	8,783		$	36,035			(76	%)
Operating Margin		1	%		6	%					3	%		10	%

Investment Advisors:
Revenues		45,106			48,095			(6	%)		189,780			183,378			3	%
Expenses		27,613			28,259			(2	%)		110,438			110,388			0	%

Operating Profit		17,493			19,836			(12	%)		79,342			72,990			9	%
Operating Margin		39	%		41	%					42	%		40	%

Institutional Investors:
Revenues		49,895			53,710			(7	%)		210,027			206,531			2	%
Expenses		26,702			28,038			(5	%)		106,585			106,934			0	%

Operating Profit		23,193			25,672			(10	%)		103,442			99,597			4	%
Operating Margin		46	%		48	%					49	%		48	%

Investment Managers:
Revenues		44,497			42,561			5	%		177,975			160,159			11	%
Expenses		29,270			27,503			6	%		115,963			103,421			12	%

Operating Profit		15,227			15,058			1	%		62,012			56,738			9	%
Operating Margin		34	%		35	%					35	%		35	%

Investments in New Businesses:
Revenues		906			1,095			(17	%)		3,823			4,099			(7	%)
Expenses		3,085			3,196			(3	%)		11,559			12,676			(9	%)

Operating Loss		(2,179	)		(2,101	)		4	%		(7,736	)		(8,577	)		(10	%)
Operating Margin		N/A			N/A						N/A			N/A

Totals:
Revenues	$	226,247		$	231,399			(2	%)	$	929,727		$	900,835			3	%
Expenses		171,439			167,955			2	%		683,884			644,052			6	%
Corporate overhead expenses		10,875			12,076			(10	%)		43,398			40,715			7	%
Noncontrolling interest reflected in segments		(442	)		(509	)		N/A			(1,620	)		(1,465	)		N/A

Income from operations	$	44,375		$	51,877			(14	%)	$	204,065		$	217,533			(6	%)

Fourth-Quarter Business Commentary:

•

Revenues declined in fourth-quarter 2011 as compared to fourth-quarter 2010 and to third-quarter 2011 due to a decrease in Asset management, administration, and distribution fee revenues from the market decline experienced at the end of third-quarter 2011. Although ending assets increased during the fourth-quarter 2011, SEI’s average assets under management (which SEI uses to calculate revenue) decreased during fourth-quarter 2011 compared to fourth-quarter 2010 as well as to third-quarter 2011 (See attached Ending and Average Asset Balances schedules for further details).

•

Revenues in fourth-quarter 2011 compared to fourth-quarter 2010 also declined due to lower information processing fees due to a decline in one-time revenues.

•

Sales events, net of client losses, during fourth-quarter 2011 totaled approximately $20.0 million and are expected to generate net annualized recurring revenues of approximately $16.0 million when contract values are fully realized.

•

Net income attributable to SEI includes losses from SIV securities of $0.7 million in fourth-quarter 2011 compared to gains of $14.3 million in fourth-quarter 2010. In addition fourth-quarter 2010 included gains of $3.8 million relating to sales of other assets.

•

Diluted earnings per share in fourth-quarter 2011 declined versus third-quarter 2011 due mainly to the revenue decreases mentioned above. Diluted earnings per share declined versus fourth-quarter 2010 due to the revenue decreases above, in addition to SIV and other gains recorded on investments in fourth-quarter 2010.

•

The effective tax rates were 34.7 percent in the fourth-quarter 2011 as well as in the fourth-quarter 2010. The tax rate in the fourth-quarter 2011 benefited from tax planning strategies while fourth-quarter 2010 benefited from a year-to-date adjustment to reflect the reinstatement of the research and development tax credit.

•

In the fourth-quarter 2011, SEI purchased 3.2 million shares of its common stock for $52.5 million.

•

In the fourth-quarter 2011, SEI made a $20.0 million payment on its outstanding debt. As of December 31, 2011, SEI no longer carries any debt.

Earnings Conference Call

A conference call to review earnings is scheduled for 2:00 PM ET on January 25, 2012. Investors may listen to the call at www.seic.com/investors 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) 1-866-206-5917; (International) 703-639-1106, access code 234129.

About SEI

SEI (NASDAQ:SEIC) is a leading global provider of investment processing, fund processing, and investment management business outsourcing solutions that help corporations, financial institutions, financial advisors, and ultra-high-net-worth families create and manage wealth. As of December 31, 2011, through its subsidiaries and partnerships in which the company has a significant interest, SEI manages or administers $404 billion in mutual fund and pooled or separately managed assets, including $172 billion in assets under management and $232 billion in client assets under administration. For more information, visit www.seic.com.

Many of the statements in this release 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 OPERATIONS

(In thousands, except per share data)

(Unaudited)


	Three Months Ended December 31,
	2011			2010

Asset management, admin. and distribution fees	$	162,126		$	165,024
Information processing and software servicing fees		54,882			56,381
Transaction-based and trade execution fees		9,239			9,994


Total revenues		226,247			231,399

Subadvisory, distribution and other asset mgmt costs		25,921			26,302
Software royalties and other information processing costs		6,529			5,923
Brokerage commissions		6,816			6,221
Compensation, benefits and other personnel		74,609			70,243
Stock-based compensation		3,146			10,380
Consulting, outsourcing and professional fees		27,592			23,783
Data processing and computer related		11,774			10,552
Facilities, supplies and other costs		13,105			14,455
Amortization		7,257			6,153
Depreciation		5,123			5,510


Total expenses		181,872			179,522

Income from operations		44,375			51,877

Net (loss) gain on investments		(552	)		18,098
Interest and dividend income		1,449			1,503
Interest expense		(100	)		(256	)
Other expense, net		—			(1,660	)
Equity in earnings of unconsolidated affiliate		23,431			26,618


Net income before income taxes		68,603			96,180

Income taxes		23,750			33,278


Net income		44,853			62,902


Less: Net income attributable to the noncontrolling interest		(457	)		(502	)


Net income attributable to SEI	$	44,396		$	62,400


Diluted earnings per common share	$	0.25		$	0.33


Shares used to calculate diluted earnings per common share		178,412			189,200


Basic earnings per common share	$	0.25		$	0.33


Shares used to calculate basic earnings per common share		178,098			186,602

SEI INVESTMENTS COMPANY

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

(Unaudited)


	Twelve Months Ended December 31,
	2011			2010

Asset management, admin. and distribution fees	$	669,788		$	628,535
Information processing and software servicing fees		222,417			231,529
Transaction-based and trade execution fees		37,522			40,771


Total revenues		929,727			900,835

Subadvisory, distribution and other asset mgmt costs		103,134			101,722
Software royalties and other information processing costs		27,437			24,419
Brokerage commissions		27,022			28,882
Compensation, benefits and other personnel		289,445			269,165
Stock-based compensation		14,112			26,783
Consulting, outsourcing and professional fees		113,171			89,033
Data processing and computer related		47,003			41,064
Facilities, supplies and other costs		55,579			56,284
Amortization		27,288			24,048
Depreciation		21,471			21,902


Total expenses		725,662			683,302

Income from operations		204,065			217,533

Net gain on investments		3,360			48,533
Interest and dividend income		5,829			6,326
Interest expense		(585	)		(1,478	)
Other expense, net		—			(590	)
Equity in earnings of unconsolidated affiliate		105,818			99,457


Net income before income taxes		318,487			369,781

Income taxes		111,837			136,461


Net income		206,650			233,320


Less: Net income attributable to the noncontrolling interest		(1,691	)		(1,633	)


Net income attributable to SEI	$	204,959		$	231,687


Diluted earnings per common share	$	1.11		$	1.22


Shares used to calculate diluted earnings per common share		184,127			190,321


Basic earnings per common share	$	1.12		$	1.23


Shares used to calculate basic earnings per common share		182,547			188,468

SEI INVESTMENTS COMPANY

CONDENSED BALANCE SHEETS

(In thousands)


	(Unaudited) December 31, 2011		December 31, 2010
Assets

Cash and short-term investments	$	420,986	$	496,292
Restricted cash		6,000		4,000
Receivables, net		167,909		165,772
Securities owned		20,949		—
Other current assets		19,107		17,655


Total current assets		634,951		683,719

Property and equipment, net		129,548		140,568
Marketable securities		139,333		179,364
Capitalized software, net		309,133		294,332
Investment in unconsolidated affiliate		60,954		64,409
Other assets, net		20,640		14,831


Total assets	$	1,294,559	$	1,377,223


Liabilities

Current liabilities	$	151,073	$	127,600
Long-term debt		—		95,000
Deferred income taxes		93,751		92,253
Other Long-term liabilities		8,276		5,645

Total SEI Investments Company shareholders’ equity		1,025,316		1,041,570
Noncontrolling interest		16,143		15,155
Total Equity		1,041,459		1,056,725


Total liabilities and equity	$	1,294,559	$	1,377,223

SEI INVESTMENTS COMPANY

ENDING ASSET BALANCES

(In millions)

(Unaudited)


	Dec. 31, 2010		Mar. 31, 2011		Jun. 30, 2011		Sept. 30, 2011		Dec. 31, 2011
Private Banks:
Equity/Fixed Income prgms.	$	13,512	$	14,809	$	16,720	$	15,442	$	16,435
Collective Trust Fund prgms.		626		576		504		476		450
Liquidity funds		5,120		5,217		4,918		5,529		5,553

Total assets under mgmt.	$	19,258	$	20,602	$	22,142	$	21,447	$	22,438

Client assets under admin.		10,672		11,227		10,994		9,845		10,355

Total assets	$	29,930	$	31,829	$	33,136	$	31,292	$	32,793

Investment Advisors:
Equity/Fixed Income prgms.	$	27,680	$	28,296	$	28,410	$	24,757	$	26,639
Collective Trust Fund prgms.		1,820		1,618		1,499		1,392		1,298
Liquidity funds		1,641		1,551		1,651		2,653		2,505

Total assets under mgmt.	$	31,141	$	31,465	$	31,560	$	28,802	$	30,442

Institutional Investors:
Equity/Fixed Income prgms.	$	48,699	$	51,287	$	51,180	$	46,259	$	49,051
Collective Trust Fund prgms.		623		608		482		510		492
Liquidity funds		3,382		3,202		3,146		3,356		3,888

Total assets under mgmt.	$	52,704	$	55,097	$	54,808	$	50,125	$	53,431

Investment Managers:
Equity/Fixed Income prgms.	$	1	$	37	$	50	$	64	$	57
Collective Trust Fund prgms.		8,177		8,841		10,372		10,896		11,255
Liquidity funds		313		139		179		195		152

Total assets under mgmt.	$	8,491	$	9,017	$	10,601	$	11,155	$	11,464

Client assets under admin. (A)		233,079		238,335		238,432		223,620		221,198

Total assets	$	241,570	$	247,352	$	249,033	$	234,775	$	232,662

Investments in New Businesses:
Equity/Fixed Income prgms.	$	569	$	598	$	558	$	490	$	515
Liquidity funds		65		56		41		41		37

Total assets under mgmt.	$	634	$	654	$	599	$	531	$	552

LSV Asset Management
Equity/Fixed Income prgms.	$	60,058	$	62,369	$	60,626	$	49,444	$	53,712

Consolidated:
Equity/Fixed Income prgms (B)	$	150,519	$	157,396	$	157,544	$	136,456	$	146,409
Collective Trust Fund prgms.		11,246		11,643		12,857		13,274		13,495
Liquidity funds		10,521		10,165		9,935		11,774		12,135

Total assets under mgmt.	$	172,286	$	179,204	$	180,336	$	161,504	$	172,039

Client assets under admin. (C)		243,751		249,562		249,426		233,465		231,553

Total assets	$	416,037	$	428,766	$	429,762	$	394,969	$	403,592

(A)	Client assets under administration in the Investment Managers segment include $39.5 billion of assets balances that require limited services and therefore are at fee levels below our normal full service assets (as of December 31, 2011).

(B)	Equity/Fixed Income programs include $2.3 billion of assets invested in various asset allocation funds at December 31, 2011.

(C)	In addition to the numbers presented, SEI also administers an additional $4.4 billion in Funds of Funds assets (as of December 31, 2011) on which SEI does not earn an administration fee.

SEI INVESTMENTS COMPANY

AVERAGE ASSET BALANCES

(In millions)

(Unaudited)


	4th Qtr 2010		1st Qtr 2011		2nd Qtr 2011		3rd Qtr 2011		4th Qtr 2011
Private Banks:
Equity/Fixed Income prgms.	$	13,200	$	14,170	$	16,176	$	16,592	$	16,624
Collective Trust Fund prgms.		618		593		543		505		464
Liquidity funds		4,966		5,058		4,909		5,210		5,401

Total assets under mgmt.	$	18,784	$	19,821	$	21,628	$	22,307	$	22,489

Client assets under admin.		10,749		10,921		11,114		10,364		10,290

Total assets	$	29,533	$	30,742	$	32,742	$	32,671	$	32,779

Investment Advisors:
Equity/Fixed Income prgms.	$	27,121	$	27,841	$	28,502	$	26,658	$	26,094
Collective Trust Fund prgms.		1,893		1,687		1,544		1,442		1,314
Liquidity funds		1,729		1,580		1,576		2,224		2,499

Total assets under mgmt.	$	30,743	$	31,108	$	31,622	$	30,324	$	29,907

Institutional Investors:
Equity/Fixed Income prgms.	$	48,310	$	50,392	$	51,567	$	49,115	$	48,504
Collective Trust Fund prgms.		638		608		554		505		500
Liquidity funds		3,450		3,418		3,515		3,416		3,461

Total assets under mgmt.	$	52,398	$	54,418	$	55,636	$	53,036	$	52,465

Investment Managers:
Equity/Fixed Income prgms.	$	1	$	1	$	38	$	52	$	65
Collective Trust Fund prgms.		7,986		8,288		9,560		11,292		10,773
Liquidity funds		406		210		165		200		219

Total assets under mgmt.	$	8,393	$	8,499	$	9,763	$	11,544	$	11,057

Client assets under admin.		233,680		237,376		241,423		236,953		224,633

Total assets	$	242,073	$	245,875	$	251,186	$	248,497	$	235,690

Investments in New Businesses:
Equity/Fixed Income prgms.	$	551	$	579	$	561	$	525	$	515
Liquidity funds		70		61		42		42		42

Total assets under mgmt.	$	621	$	640	$	603	$	567	$	557

LSV Asset Management
Equity/Fixed Income prgms.	$	57,523	$	62,212	$	63,000	$	54,679	$	54,021

Consolidated:
Equity/Fixed Income prgms	$	146,706	$	155,195	$	159,844	$	147,621	$	145,823
Collective Trust Fund prgms.		11,135		11,176		12,201		13,744		13,051
Liquidity funds		10,621		10,327		10,207		11,092		11,622

Total assets under mgmt.	$	168,462	$	176,698	$	182,252	$	172,457	$	170,496

Client assets under admin.		244,429		248,297		252,537		247,317		234,923

Total assets	$	412,891	$	424,995	$	434,789	$	419,774	$	405,419