BlackRock Inc. - FORM 8-K - EX-99.2 - FIRST QUARTER 2015 EARNINGS - EARNINGS RELEASE SUPPLEMENT

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8-K - FORM 8-K - BlackRock Inc.	d906078d8k.htm
EX-99.1 - EARNINGS RELEASE DATED APRIL 16, 2015 ISSUED BY THE COMPANY - BlackRock Inc.	d906078dex991.htm

Q1 2015 Earnings

Earnings Release Supplement:

Results

presented

“as

adjusted”

basis,

unless

otherwise

noted

April 16, 2015

Exhibit 99.2

A broadly diversified business across clients, products and geographies

Q1 2015 Long-term Base Fees of $2.317 billion

Long-term Assets Under Management of $4.464 trillion at March 31, 2015

Product Type

Client Type

Style

Region

Alternatives 3%

Alternatives 7%

Multi-asset

13%

Fixed Income

32%

Fixed Income

25%

Equity

56%

Equity

55%

iShares

24%

iShares

36%

Retail

12%

Retail

34%

Institutional

64%

Institutional

30%

AUM

Base Fees

AUM

Base Fees

Index

42%

Index

10%

iShares

24%

iShares

36%

Asia-Pacific 9%

Asia-Pacific 8%

EMEA

29%

EMEA

28%

Americas

62%

Americas

64%

Active

34%

Active

54%

AUM

Base Fees

AUM

Base Fees

Note: Revenue and AUM by region data is based on client domicile.

Long-term net flows ($ in billions)

Total Long-Term

Retail

iShares

Institutional

10%

14%

13%

11%

(3%)

(2%)

13%

LTM organic asset growth rate (%)

11%

14%

Note: LTM organic asset growth rate measures rolling last twelve months net new flows over beginning period assets.

$39

$12

$25

$41

$27

$38

$29

2013

2014

2015

$17

$14

$13

$23

$14

2013

2014

2015

$26

($1)

$20

$19

$30

$18

$44

$35

2013

2014

2015

($3)

($6)

$21

2013

2014

2015

$88

$70

Profitability ($ in millions, except per share data)

Net Income and EPS, as adjusted

Operating Income and Margin, as adjusted

For further information and reconciliation between GAAP and as adjusted, see page 9 of this earnings release supplement, notes (1) through (4) in the current earnings release as well as previously filed Form 10-Ks,

10-Qs and 8-Ks.

Operating Income

Operating Margin

•

Operating income, as adjusted

up 1% year-over-year

•

Operating margin, as adjusted

down 20 bps year-over-year

•

Net income, as adjusted

up 9% year-over-year

•

EPS, as adjusted

up 10% year-over-year

Net Income

EPS

$921

$982

$978

$1,143

$1,062

$1,133

$1,214

$1,154

$1,077

40.0%

41.3%

41.2%

42.7%

41.4%

42.4%

44.2%

43.6%

41.2%

2013

2014

2015

$637

$722

$672

$851

$762

$837

$890

$821

$830

$3.65

$4.15

$3.88

$4.92

$4.43

$4.89

$5.21

$4.82

$4.89

2013

2014

2015

Capital management (amounts in millions, except per share data)

Amounts above exclude repurchases of employee tax withholdings related to employee stock transactions.

GAAP Dividend Payout Ratio = Dividends declared / GAAP net income.

Total GAAP Payout Ratio = (Dividends declared + share repurchases) / GAAP net income.

Share repurchases and weighted average diluted shares

Dividends and Payout Ratios

$275

$250

169.7

170.4

170.8

171.2

171.9

173.0

173.4

173.9

174.6

2015

2014

2013

Share Repurchases

Weighted average diluted shares

$1.68

$1.93

$2.18

49%

39%

34%

48%

40%

35%

40%

47%

88%

74%

64%

81%

71%

63%

70%

81%

2013

2014

2015

Dividends

GAAP Dividend Payout Ratio

Total GAAP Payout Ratio

Major market indices and exchange rates

Spot

% Change

3/31/2015 vs.

Average

% Change

Q1 2015 vs.

3/31/2014

12/31/2014

3/31/2015

12/31/2014

3/31/2014

Q1 2014

Q4 2014

Q1 2015

Q4 2014

Q1 2014

Equity Indices:

Domestic

S&P 500

1,872

2,059

2,068

10%

1,835

2,011

2,063

12%

Global

MSCI Barra World Index

1,674

1,710

1,741

1,647

1,695

1,726

MSCI Europe Index

114

117

135

15%

18%

113

114

128

12%

13%

MSCI AC Asia Pacific Index

138

146

137

139

142

MSCI Emerging Markets Index

995

956

975

(2%)

957

982

969

(1%)

S&P Global Natural Resources

3,499

3,147

3,061

(3%)

(13%)

3,429

3,249

3,140

(3%)

(8%)

Fixed Income Index:

Barclays U.S. Aggregate Bond Index

1,840

1,915

1,946

1,831

1,905

1,936

Foreign Exchange Rates:

GBP to USD

1.67

1.56

1.48

(5%)

(11%)

1.66

1.58

1.51

(4%)

(9%)

EUR to USD

1.38

1.21

1.07

(12%)

(22%)

1.37

1.25

1.13

(10%)

(18%)

Source: Bloomberg

Quarterly revenue

Q1 2015 Compared to Q1 2014

$53 million

Total Revenue

Q1 2015 Compared to Q4 2014

($61) million

Q1 2015

$2,723 million

Base Fees ex. Securities Lending

Securities Lending

Performance Fees

Aladdin

Other BRS

Distribution Fees

Other Revenue

83%

$2,670

$2,723

$90

$14

$13

($2)

($21)

($50)

Q1 2014

Base Fees ex

Sec Lending

Aladdin

Other

Revenue

Securities

Lending

Distribution

fees

Other BRS

Performance

Fees

Q1 2015

$2,784

$2,723

($1)

($3)

($22)

($36)

Q4 2014

Other

Revenue

Distribution

fees

Aladdin

Base Fees ex

Sec Lending

Securities

Lending

Other BRS

Performance

Fees

Q1 2015

Percentage Change

Year-over-Year

Sequential

Base Fees ex. SL

Securities Lending

(3)

Performance Fees

(32)

(25)

Aladdin

(1)

Other BRS

(50)

(51)

Distribution Fees

(11)

Other Revenue

Total

(2)

Quarterly investment advisory, administration fees and securities lending revenue

Q1 2015: $2,390 million

Q1 2015 Compared to Q1 2014

Investment advisory, administration fees and securities lending revenue

$99 million

Q1 2015 Compared to Q4 2014

($6) million

Q1 2014: $2,291 million

Q4 2014: $2,396 million

$2,291

$2,390

$50

$49

$18

$17

$10

($1)

($8)

($41)

Q1 2014

iShares

Active FI

Multi-

Asset

iShares

Non-ETF Non-ETF

Index FI

Index EQ

Cash

Alts

Active

Q1 2015

$2,396

$2,390

($2)

($5)

($6)

($7)

Q4 2014

Active FI

iShares FI

Non-ETF FI

Multi-Asset

iShares

Non-ETF

Active EQ

Alts

Q1 2015

20%

28%

14%

12%

Active Equity

iShares Equity

Active Fixed Income

iShares Fixed Income

Multi-Assets

Alternatives

Non-ETF Index Equity

Non-ETF Index Fixed Income

Cash

17%

29%

16%

13%

17%

29%

15%

13%

Quarterly expense

Expense, as adjusted, by category

Q1 2015 Compared to Q1 2014, as adjusted

For further information and reconciliation between GAAP and as adjusted, see page 9 of this earnings release supplement and notes (1) through (4) in the current earnings release.

$38 million

Q1 2015 Compared to Q4 2014, as adjusted

$16 million

Percentage Change

Year-over-Year

Sequential

Employee Comp. & Benefits

Distribution & Servicing Costs

Amort. of Deferred Sales Commissions

(13)

Direct Fund Expense

General & Administrative

(12)

Amortization of Intangibles

(15)

Total

Q1 2015

$1,646 million

$1,608

$1,646

$10

$26

($6)

($2)

Q1 2014

Amort -Intang

assets

Amort -Def

Sales

Commission

Direct Fund

Distribution &

Servicing

G&A

Q1 2015

$1,630

$1,646

$55

($48)

Q4 2014

G&A

Distribution &

Servicing

Direct Fund

Expense

Comp &

Benefits

Q1 2015

59%

11%

21%

Employee Comp. & Benefits

Distribution & Servicing Costs

Amort. of Deferred Sales

Commissions

Direct Fund Expense

General & Administration

Amortization of Intangibles

2013

2014

2015

Operating Income

GAAP

$909

$849

$966

$1,133

$1,051

$1,122

$1,157

$1,144

$1,067

Non-GAAP adjustments

133

As Adjusted

$921

$982

$978

$1,143

$1,062

$1,133

$1,214

$1,154

$1,077

Nonoperating Income (Expense)

GAAP

$41

$69

($18)

$24

$17

$16

($52)

($60)

$51

Non-GAAP adjustments

(38)

(57)

(3)

(11)

(36)

(40)

As Adjusted

$12

($21)

$13

$26

($20)

($8)

($54)

$11

Net Income

GAAP

$632

$729

$730

$841

$756

$808

$917

$813

$822

Non-GAAP adjustments

(7)

(58)

(27)

As Adjusted

$637

$722

$672

$851

$762

$837

$890

$821

$830

Reconciliation between GAAP and as adjusted ($ in millions)

Non-GAAP

adjustments

include

amounts

the

reduction

indemnification

asset,

the

PennyMac

Charitable

Contribution,

PNC

LTIP

funding

obligation,

compensation

appreciation

(depreciation) on certain deferred compensation plans and noncash income tax matters, as applicable.

For further information and reconciliation between GAAP and as adjusted, see notes (1) through (4) in the current earnings release as well as previously filed Form 10-Ks, 10-Qs and 8-Ks.

Important Notes

This presentation, and other statements that BlackRock, Inc. (“BlackRock”) may make, may contain forward-looking statements within the meaning of the

Private Securities Litigation Reform Act, with respect to BlackRock’s future financial or business performance, strategies or expectations. Forward-

looking

statements

are

typically

identified

words

phrases

such

“trend,”

“potential,”

“opportunity,”

“pipeline,”

“believe,”

“comfortable,”

“expect,”

“anticipate,”

“current,”

“intention,”

“estimate,”

“position,”

“assume,”

“outlook,”

“continue,”

“remain,”

“maintain,”

“sustain,”

“seek,”

“achieve,”

and similar

expressions, or future or conditional verbs such as “will,”

“would,”

“should,”

“could,”

“may”

and similar expressions.

BlackRock cautions that forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time. Forward-

looking statements speak only as of the date they are made, and BlackRock assumes no duty to and does not undertake to update forward-looking

statements. Actual results could differ materially from those anticipated in forward-looking statements and future results could differ materially from

historical performance.

In addition to risk factors previously disclosed in BlackRock’s Securities and Exchange Commission reports and those identified elsewhere in this

presentation, the following factors, among others, could cause actual results to differ materially from forward-looking statements or historical performance:

(1)

the

introduction,

withdrawal,

success

and

timing

business

initiatives

and

strategies;

(2)

changes

and

volatility

political,

economic

industry

conditions, the interest rate environment, foreign exchange rates or financial and capital markets, which could result in changes in demand for products or

services

the

value

assets

under

management;

(3)

the

relative

and

absolute

investment

performance

BlackRock’s

investment

products;

(4)

the

impact of increased competition; (5)

the impact of future acquisitions or divestitures; (6)

the unfavorable resolution of legal proceedings; (7)

the extent and

timing of any share repurchases; (8)

the impact, extent and timing of technological changes and the adequacy of intellectual property, information and

cyber security protection; (9)

the impact of legislative and regulatory actions and reforms, including the Dodd-Frank Wall Street Reform and Consumer

Protection Act, and regulatory, supervisory or enforcement actions of government agencies relating to BlackRock or The PNC Financial Services Group,

Inc.; (10)

terrorist activities, international hostilities and natural disasters, which may adversely affect the general economy, domestic and local financial

and

capital

markets,

specific

industries

BlackRock;

(11)

the

ability

attract

and

retain

highly

talented

professionals;

(12)

fluctuations

the

carrying

value of BlackRock’s economic investments; (13)

the impact of changes to tax legislation, including income, payroll and transaction taxes, and taxation on

products

transactions,

which

could

affect

the

value

proposition

clients

and,

generally,

the

tax

position

BlackRock;

(14)

BlackRock’s

success

maintaining

the

distribution

its

products;

(15)

the

impact

BlackRock

electing

provide

support

its

products

from

time

and

any

potential

liabilities

securities

lending

other

indemnification

obligations;

and

(16)

the

impact

problems

other

financial

institutions

the

failure

negative performance of products at other financial institutions.

This presentation also includes non-GAAP financial measures. You can find our presentations on the most directly comparable GAAP financial measures

calculated in accordance with GAAP and our reconciliations on page 9 of this earnings release supplement, our current earnings release dated April 16,

2015,

and

BlackRock’s

other

periodic

reports,

which

are

available

BlackRock’s

web

site

BlackRock Inc. - FORM 8-K - EX-99.2 - FIRST QUARTER 2015 EARNINGS - EARNINGS RELEASE SUPPLEMENT - April 16, 2015

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