Sprott Inc. reported Thursday that its first-quarter profit plunged 56 per cent from a year ago as management fees fell amid stock market turmoil.
The Toronto-based investment company's profit fell to $7.4-million, or 5 cents per share, for the quarter ended March 31. That compares with a profit of $16.7-million, or 12 cents a year, in the year-ago period.
Total revenue fell 38 per cent to $26.7-million from $43.1-million a year earlier. This includes management fees, crystallized performance fees, gains from proprietary investments and interest and other income.
Sprott's hedge funds had suffered from significant redemption in the last quarter of 2008 from offshore clients, many of whom were financial institutions which held them in funds of funds.
"The rate of redemptions slowed significantly during the quarter, while sales increased," said Eric Sprott, chief executive officer of Sprott.
"March was the first positive net sales month since August, 2008, reflecting strong performance of our funds, reduced de-leveraging activity from our institutional hedge fund clients and the launch of the Sprott Gold Bullion Fund," Mr. Sprott said in a statement.
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