AllianceBernstein Holding L.P. Announces First Quarter Results

        AllianceBernstein Holding L.P. Announces First Quarter Results

GAAP Diluted Net Income of $0.38 per Unit

Adjusted Diluted Net Income of $0.38 per Unit

Cash Distribution of $0.38 per Unit

PR Newswire

NEW YORK, May 1, 2013

NEW YORK, May 1, 2013  /PRNewswire/ --AllianceBernstein L.P.
("AllianceBernstein") and AllianceBernstein Holding L.P. ("AllianceBernstein
Holding") (NYSE: AB) today reported financial and operating results for the
quarter ended March 31, 2013.

"Operating conditions have been favorable so far in 2013, allowing us to make
further progress with our strategy to deliver for clients with our products
and performance and strengthen our financial position," said Peter S. Kraus,
Chairman and Chief Executive Officer. "The first quarter's continued high
demand for fixed income, strong equity markets and more stable global
macroeconomic backdrop contributed to our solid first quarter results. Gross
sales were up 31% from the same period last year, net flows were positive for
the second consecutive quarter, and we once again reduced our expenses and
expanded our adjusted operating margin."

                                                      1Q                 1Q
                                                      2013               2013
Financial Results              1Q 2013    4Q 2012    vs      1Q 2012    vs
                                                      4Q                 1Q
                                                      2012               2012
($ millions except per Unit
amounts)
AllianceBernstein L.P.
GAAP basis:
Net Revenues                    $709       $705       1%      $682       4%
Operating Income              $124       $78        59%     $101       23%
Operating Margin, excl.         17.7%      11.4%              13.8%
non-controlling interests
Adjusted basis: ^(1)
Net Revenues ^(2)               $577       $578       -       $562       3%
Operating Income ^(3)           $126       $119       6%      $101       25%
Operating Margin                21.9%      20.6%              18.0%
AllianceBernstein Holding L.P.
GAAP Diluted Net Income per     $0.38      $0.26      46%     $0.26      46%
Unit
Distribution per Unit           $0.38      $0.40      (5%)    $0.26      46%
Adjusted Diluted Net Income per $0.38      $0.40      (5%)    $0.29      31%
Unit^(1)
^(1)See pages 11-13 for reconciliations of GAAP Financial
Results to Adjusted Financial Results.
^(2)Adjusted net revenues exclude investment gains and losses and dividends
and interest on long-term incentive compensation-related investments, and 90%
of the investment gains and losses of our consolidated venture capital fund
attributable to non-controlling interests. In addition, adjusted net revenues
offset distribution-related payments to third parties as well as amortization
of deferred sales commissions against distribution revenues. They also exclude
certain revenues that are reimbursements of pass-through expenses (primarily
through our transfer agency).
^(3)Adjusted operating income represents operating income on a GAAP basis
excluding (1) the impact on net revenues and compensation expense of the
mark-to-market gains and losses (as well as the dividends and interest)
associated with employee long-term incentive compensation-related
investments), (2) the 2011 compensation charge, (3) real estate related
charges, and (4) the net loss or income of consolidated entities attributable
to non-controlling interests.

Kraus continued: "In this environment, momentum continued to build in our
Institutions channel, where gross sales nearly doubled year-over-year and net
inflows increased by 14% sequentially. Retail net flows remained in positive
territory, with strength in the North America and EMEA regions. In Private
Client, not only did gross sales increase by 85% sequentially, client
redemptions declined significantly, and net outflows were our lowest since the
first quarter of 2011. We continue to demonstrate with many of our offerings
that we can deliver clients the investment solutions they need and the
performance they demand across channels and geographies. In fixed income, our
lineup of outperforming global multi-sector, credit, emerging markets, high
yield and US tax-exempt services allows us to meet client demand for assets
that are less correlated with US Treasuries and more income-oriented. In
active equities, we continue to excel in services like Select US Equity and US
Small- and SMID-Cap Value, where we rank highly across multiple time periods,
and we delivered another quarter of relative outperformance in US and Global
Value. Our multi-asset and alternatives offerings continue to gain traction as
well. We recently celebrated Institutional mandate wins for our emerging
markets multi-asset (EMMA) and Select US Long/Short services in the US, Europe
and Asia, and our new fund-of-hedge-funds registered investment company (RIC)
offering in Private Client has been very well received, attracting nearly $400
million in assets since our September 2012 launch. Finally, we have maintained
our expense discipline, even as activity levels have picked up. During the
first quarter, we reduced our adjusted operating expenses by nearly 2%
sequentially and increased our adjusted margin, to 21.9%. We keep moving
forward in our long-term strategy to improve investment performance, diversify
and globalize our business, innovate for clients with our offerings and
strengthen our financial position. While we still face global economic and
political uncertainties around U.S. and European sovereign debt and unrest in
the Middle East and Pacific Rim, I'm confident we'll make continued progress
from here."

The firm's cash distribution per unit of $0.38 is payable on May 23, 2013, to
holders of record of AllianceBernstein Holding Units at the close of business
on May 13, 2013.

Market Performance

Global equity market returns were strong in the first quarter of 2013. The S&P
500 returned 10.6% and the MSCI World Index was up 7.9%. Fixed income markets
were flat to down. The Barclays Capital US Aggregate Index returned (0.1)%
during the quarter and the Barclays Capital Global Aggregate Index's total
return was (2.1)%.

Assets Under Management ($ Billions)

Total assets under management as of March 31, 2013 were $443.2 billion, up
$13.2 billion, or 3.1%, from December 31, 2012, and $24.1 billion, or 5.8%,
from March 31, 2012.

                                  Institutions  Retail  Private Client  Total
Assets Under Management 3/31/13   $225.1        $150.4  $67.7           $443.2
Net Flows for Three Months Ended  $3.3          $0.2    ($0.9)          $2.6
3/31/13

Total net inflows of $2.6 billion were $2.4 billion lower than the prior
quarter and $14.7 billion higher than the prior-year period. Net inflows to
the Institutions channel were $3.3 billion, compared to net inflows of $2.9
billion in the fourth quarter. Institutions gross sales increased 8%
sequentially, to $7.3 billion, from the prior quarter's $6.7 billion. The
pipeline of awarded but unfunded Institutional mandates decreased sequentially
from $8.0 billion to $7.8 billion at March 31, 2013, as new fixed income and
equity additions were more than offset by fundings and revisions during the
quarter. The Retail channel experienced first quarter 2013 net inflows of $0.2
billion, down from the prior quarter's $5.3 billion. Retail gross sales
decreased 11% sequentially to $14.6 billion from the fourth quarter's record
$16.4 billion. In the Private Client channel, first quarter net outflows were
$0.9 billion, compared to $3.2 billion in net outflows in the fourth quarter.
Private Client gross sales increased 85% sequentially to $1.8 billion from the
prior quarter's $1.0 billion.

In the first quarter of 2013 the Company altered its AUM disclosure in order
to provide greater transparency into the impact of prevailing industry trends
on its asset mix and fee realization rate. The new disclosure addresses the
long-term industry-wide trend of increasing asset flows into passive products
by providing a breakout of both equity and fixed income AUM into actively
managed assets and passively managed assets, which include index, enhanced
index and factor-based strategies. In addition, in acknowledgement of its
significant growth in fixed income assets over the past several years and the
current size of the business, the Company now breaks out its active fixed
income AUM into taxable and tax-exempt assets.

First Quarter Financial Results

Revenues:

Net revenues of $709 million increased 4% compared to the first quarter of
2012, driven by higher distribution revenues on non-US retail products, retail
base fees and Bernstein Research Services revenues, which more than offset
lower investment gains and performance-based fees versus the prior-year
period. Sequentially, net revenues increased 1%. Higher base fees, Bernstein
Research Services revenues, investment gains and distribution revenues from
non-US retail products more than offset lower performance-based fees and
dividend & interest income. Bernstein Research Services revenues increased 4%
from the first quarter of 2012 and 6% from the fourth quarter of 2012,
resulting from higher trading activity, particularly in Asia and Europe,
partially offset by fewer trading days in the quarter versus both prior
periods.

Adjusted net revenues of $577 million were up 3% compared to the first quarter
of 2012, driven primarily by higher base fees and Bernstein Research Services
revenues, which were partially offset by lower current quarter investment
gains compared to the prior-year period and lower net distribution.
Sequentially, adjusted net revenues were essentially flat, as higher base
fees, Bernstein Research Services revenues and investment gains were offset by
lower performance-based fees.

Expenses:

Operating expenses were $585 million for the first quarter, up 1%
year-over-year, driven primarily by higher promotion and servicing expense,
partially offset by lower general and administrative (G&A) expense. Promotion
and servicing expense was up from the prior-year period due to higher
distribution plan payments in non-US retail markets, trade execution and
clearance costs, transfer fees and marketing expenses, partly offset by lower
travel and entertainment costs. Within G&A, office and occupancy expense,
professional fees, sub-advisory fees and technology-related costs were all
lower versus the prior-year period. In addition, in the first quarter of 2012,
the Company recorded non-cash real estate charges totaling $9.3 million
largely offset by the cash receipt of $6.5 million related to the finalization
of a claims processing contingency originally recorded as an expense in 2006.
Employee compensation and benefits expense in the first quarter of 2013
decreased compared to the prior-year period, as lower salaries, severance and
other employment costs were partially offset by a higher incentive
compensation accrual and higher commissions. On a sequential basis, operating
expenses were down 7%, driven primarily by lower G&A. Within G&A, office and
occupancy costs declined significantly, the result of a $38.9 million non-cash
real estate charge the Company recognized in the prior quarter. Professional
fees were lower as the result of lower legal expenses in the current quarter
and technology-related and portfolio service costs were lower as well.
Employee compensation and benefits expense was higher due to higher
commissions and a higher incentive compensation accrual, partially offset by
lower base compensation. Promotion and servicing costs were slightly higher
sequentially due to higher marketing and trade execution and clearance costs
and distribution-related payments in non-US retail markets, largely offset by
lower travel and entertainment costs and transfer fees.

Adjusted operating expenses were $451 million for the first quarter, down 2%
compared to the prior-year period, with lower G&A the primary driver,
partially offset by higher promotion and servicing expense and employee
compensation and benefits expense. Within G&A, the decline was due to lower
office and occupancy expenses, partially offset by the cash receipt of $6.5
million in the prior-year period related to the finalization of a claims
processing contingency originally recorded as an expense in 2006. Employee
compensation and benefits expense was higher compared to the prior-year period
due to higher adjusted revenues. Sequentially, adjusted operating expenses
were down 2%, as lower G&A and promotion and servicing were partly offset by
higher employee compensation and benefits expense. The sequential decline in
G&A was due primarily to lower legal expenses and lower office and occupancy
expense, which resulted from our ongoing global real estate consolidation
plan. The sequential decline in promotion and servicing expense was due
primarily to lower travel and entertainment expenses, partially offset by
increased marketing and advertising expense. Compensation and benefits expense
was up sequentially, as compensation was accrued at a higher ratio of adjusted
revenues compared to the prior quarter.

Operating income and margin:

The Company reported operating income of $124 million for the first quarter of
2013, compared to $101 million for the first quarter of 2012, and $78 million
in the fourth quarter of 2012. During the fourth quarter of 2012, the Company
recorded a $39 million non-cash charge associated with lease abandonment and
the write off assets related to the Company's global real estate consolidation
plan.

Adjusted operating income of $126 million increased 25% from the first quarter
of 2012, and the adjusted operating margin increased to 21.9% from 18.0%, due
to both higher revenues and expense reductions. On a sequential basis,
adjusted operating income increased 6% from $119 million, and the adjusted
operating margin increased from 20.6% on flat revenues and lower expenses.

Net income per Unit:

Diluted net income per Unit for the first quarter of 2013 was $0.38 compared
to $0.26 for both the first quarter of 2012 and the fourth quarter of 2012.

Adjusted diluted net income per Unit increased to $0.38 from $0.29 in the
first quarter of 2012 and decreased from $0.40 in the fourth quarter of 2012.
Approximately $0.04 of fourth quarter diluted net income per Unit represented
a change in the estimate of a federal tax benefit relating to the first nine
months of 2012.

Unit Repurchases

AllianceBernstein engages in open-market purchases of Holding Units to help
fund anticipated obligations under its incentive compensation award program
and for other corporate purposes under a plan pursuant to Rule 10b5-1 under
the Securities Exchange Act of 1934, as amended. The amount of Holding Units
AllianceBernstein buys each quarter is subject to SEC regulations, the terms
of the 10b5-1 plan and the trading volume of Holding Units on the New York
Stock Exchange. In addition, AllianceBernstein purchases Holding Units from
employees to allow them to fulfill statutory tax requirements at the time of
distribution of long-term incentive compensation awards. During the first
quarter of 2013, AllianceBernstein purchased 1.0 million Holding Units for
$19.6 million. These amounts reflect open-market purchases of 0.8 million
Holding Units for $16.0 million, with the remainder relating to employee tax
withholding purchases, offset by Holding Units purchased by employees as part
of a distribution reinvestment election.

First Quarter 2013 Earnings Conference Call Information

Management will review first quarter 2013 financial and operating results
during a conference call beginning at 8:00 a.m. (ET) onWednesday, May 1,
2013. The conference call will be hosted by Peter S. Kraus, Chairman and Chief
Executive Officer, and John C. Weisenseel, Chief Financial Officer.

Parties may access the conference call by either webcast or telephone:

1.To listen by webcast, please visit AllianceBernstein's Investor Relations
    website at http://ir.alliancebernstein.com/investorrelations at least 15
    minutes prior to the call to download and install any necessary audio
    software.
2.To listen by telephone, please dial (866) 556-2265 in the U.S. or (973)
    935-8521 outside the U.S. 10 minutes before the scheduled start time. The
    conference ID# is 36297576.

The presentation that will be reviewed during the conference call will be
available on AllianceBernstein's Investor Relations website shortly after the
release offirst quarter 2013 financialand operating results onMay 1, 2013.

AllianceBernstein will be providing live updates via Twitter during the
conference call. To access the tweets, follow AllianceBernstein on Twitter:
@AllianceBernstn. Also, in the future, AllianceBernstein may provide public
disclosures to investors via Twitter and other appropriate internet-based
social media.

A replay of the webcast will be made available beginning approximately one
hour after the conclusion of the conference call and will be available on
AllianceBernstein's website for one week. An audio replay of the conference
call will also be available for one week. To access the audio replay, please
call (855)859-2056 in the U.S., or (404)537-3406 outside the U.S., and
provide the conference ID #: 36297576.

Cautions Regarding Forward-Looking Statements

Certain statements provided by management in this news release are
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. Such forward-looking statements are subject to
risks, uncertainties, and other factors that could cause actual results to
differ materially from future results expressed or implied by such
forward-looking statements. The most significant of these factors include,
but are not limited to, the following: the performance of financial markets,
the investment performance of sponsored investment products and
separately-managed accounts, general economic conditions, industry trends,
future acquisitions, competitive conditions, and current and proposed
government regulations, including changes in tax regulations and rates and the
manner in which the earnings of publicly-traded partnerships are taxed.
AllianceBernstein cautions readers to carefully consider such factors.
Further, such forward-looking statements speak only as of the date on which
such statements are made; AllianceBernstein undertakes no obligation to update
any forward-looking statements to reflect events or circumstances after the
date of such statements. For further information regarding these
forward-looking statements and the factors that could cause actual results to
differ, see "Risk Factors" and "Cautions Regarding Forward-Looking Statements"
in AllianceBernstein's Form 10-K for the year ended December 31, 2012 and Form
10-Q for the quarter ended March 31, 2013. Any or all of the forward-looking
statements made in this news release, Form 10-K, Form 10-Q, other documents
AllianceBernstein files with or furnishes to the SEC, and any other public
statements issued by AllianceBernstein, may turn out to be wrong. It is
important to remember that other factors besides those listed in "Risk
Factors" and "Cautions Regarding Forward-Looking Statements", and those listed
below, could also adversely affect AllianceBernstein's financial condition,
results of operations and business prospects.

The forward-looking statements referred to in the preceding paragraph include
statements regarding:

  oThe pipeline of new institutional mandates not yet funded: Before they
    are funded, institutional mandates do not represent legally binding
    commitments to fund and, accordingly, the possibility exists that not all
    mandates will be funded in the amounts and at the times currently
    anticipated, or that mandates ultimately will not be funded.
  oOur intention to continue to engage in open market purchases of Holding
    Units to help fund anticipated obligations under our incentive
    compensation award program: The number of Holding Units needed in future
    periods to make incentive compensation awards is dependent upon various
    factors, some of which are beyond our control, including the fluctuation
    in the price of a Holding Unit.
  oOur confidence that, despite ongoing global economic and political
    uncertainties, we will be able to continue executing our long-term growth
    strategy and improve AllianceBernstein's operating leverage: Changes and
    volatility in political, economic, capital market or industry conditions
    can result in changes in demand for our products and services or impact
    the value of our assets under management, all of which may adversely
    affect our results of operations. The actual performance of the capital
    markets and other factors beyond our control will affect our investment
    success for clients and asset flows. Furthermore, improved flows depend
    on a number of factors, including our ability to deliver consistent,
    competitive investment performance, which cannot be assured, conditions of
    financial markets, consultant recommendations, and changes in our clients'
    investment preferences, risk tolerances and liquidity needs.

Qualified Tax Notice

This announcement is intended to be a qualified notice under Treasury
Regulation §1.1446-4(b). Please note that 100% of AllianceBernstein Holding's
distributions to foreign investors is attributable to income that is
effectively connected with a United States trade or business. Accordingly,
AllianceBernstein Holding's distributions to foreign investors are subject to
federal income tax withholding at the highest applicable tax rate, currently
39.6%.

About AllianceBernstein

AllianceBernstein is a leading global investment management firm that offers
high-quality research and diversified investment services to institutional
investors, individuals and private clients in major world markets.

At March 31, 2013, AllianceBernstein Holding L.P. owned approximately38.0% of
the issued and outstanding AllianceBernstein Units and AXA, one of the largest
global financial services organizations, owned an approximate64.2% economic
interest in AllianceBernstein.

Additional information about AllianceBernstein may be found on our website,
www.alliancebernstein.com.



AllianceBernstein L.P. (The Operating
Partnership)
SUMMARY CONSOLIDATED STATEMENTS OF
INCOME | March 31, 2013
                                          Three Months Ended
 $ thousands, unaudited                   3/31/13        12/31/12     3/31/12
 Revenues:
    Base fees                             $440,357       $432,238     $421,169
    Performance fees                      3,480          18,481       4,391
    Bernstein research                    109,685        103,719      106,343
    services
    Distribution revenues                 118,745        115,787      90,960
    Dividend and interest                 4,446          6,828        4,406
    income
    Investment gains                      6,951          1,886        30,958
    (losses)
    Other revenues                        26,300         26,518       24,285
     Total revenues                     709,964        705,457      682,512
    Less: Interest expense                842            850          703
     Net revenues                       709,122        704,607      681,809
 Expenses:
    Employee compensation &               301,235        292,411      302,543
    benefits
    Promotion & servicing
     Distribution-related              109,280        106,322      79,869
    payments
     Amortization of deferred sales    11,074         11,167       8,267
    commissions
     Other                             50,992         53,167       49,734
    General & administrative
     General &                         105,289        118,416      124,910
    administrative
     Real estate charge                638            38,896       9,269
    Interest on borrowings                983            828          833
    Amortization of                       5,433          5,206        5,139
    intangible assets
     Total expenses                     584,924        626,413      580,564
 Operating income                        124,198        78,194       101,245
 Income taxes                            11,167         8,795        6,703
 Net income                              113,031        69,399       94,542
 Net (loss) income of consolidated
 entities attributable to                 (1,485)        (2,300)      7,264
 non-controlling interests
 Net Income Attributable to               $114,516       $71,699      $87,278
 AllianceBernstein Unitholders
 Operating margin^(1)                     17.7%          11.4%        13.8%
 ^(1)Operating income excluding net (loss) income attributable to
 non-controlling interests as a percentage of net revenues.
AllianceBernstein Holding L.P. (The
Publicly-Traded Partnership)
SUMMARY STATEMENTS OF
INCOME
                                          Three Months Ended
 $ thousands except per Unit amounts,     3/31/13        12/31/12     3/31/12
 unaudited
 Equity in Net Income Attributable to     $42,997        $26,892      $32,707
 AllianceBernstein Unitholders
 Income Taxes                             4,766          702          6,008
 Net Income                              $38,231        $26,190      26,699
 Additional Equity in Earnings of         243            2            -
 Operating Partnership ^(1)
 Net Income - Diluted                     $38,474        $26,192      $26,699
 Diluted Net Income per Unit              $0.38          $0.26        $0.26
 Distribution per Unit                    $0.38          $0.40        $0.26
 ^(1)To reflect higher ownership in the Operating Partnership resulting from
 application of the treasury stock method to outstanding options.
AllianceBernstein L.P. and
AllianceBernstein Holding L.P.
UNITS OUTSTANDING AND WEIGHTED AVERAGE
UNITS OUTSTANDING
                                          Weighted Average Units
                             Period End   Three Months Ended 3/31/13
                             Units        Basic          Diluted
 AllianceBernstein L.P.      277,993,129  277,786,161    278,722,735
 AllianceBernstein Holding   105,565,870  100,297,658    101,234,232
 L.P.

AllianceBernstein L.P.
ASSETS UNDER MANAGEMENT | March 31, 2013
($ billions)
Ending and Average                                                Three Months Ended
                                                                  3/31/13     3/31/12
 Ending Assets Under                                              $443.2      $419.1
 Management
 Average Assets Under                                             $436.7      $417.4
 Management
Three-Month Changes By Distribution
Channel
                                           Institutions  Retail   Private     Total
                                                                  Client
 Beginning of Period                       $219.8        $144.4   $65.8       $430.0
 Sales/New accounts                        7.3           14.6     1.8         23.7
 Redemptions/Terminations                  (3.6)         (12.5)   (2.5)       (18.6)
 Net Cash Flows                            (0.4)         (1.9)    (0.2)       (2.5)
 Net Flows                                 3.3           0.2      (0.9)       2.6
 Investment Performance                    2.0           5.8      2.8         10.6
 End of Period                             $225.1        $150.4   $67.7       $443.2
Three-Month Changes By Investment Service
                                  Equity                 Fixed    Fixed       Fixed    Total
                          Equity  Passive  Total         Income   Income      Income   Fixed   Other  Total
                          Active  ^(1)     Equity        Taxable  Tax-Exempt  Passive  Income  ^(2)
                                                                              ^(1)
 Beginning of Period      $95.4   $40.3    $135.7        $224.0   $30.8       $7.9     $262.7  $31.6  $430.0
 Sales/New accounts       4.3     0.9      5.2           14.0     1.7         0.3      16.0    2.5    23.7
 Redemptions/Terminations (7.1)   (0.2)    (7.3)         (9.2)    (1.4)       (0.2)    (10.8)  (0.5)  (18.6)
 Net Cash Flows           (0.7)   (0.4)    (1.1)         (1.6)    (0.3)       0.3      (1.6)   0.2    (2.5)
 Net Flows                (3.5)   0.3      (3.2)         3.2      -           0.4      3.6     2.2    2.6
 Investment Performance   6.9     3.2      10.1          (1.2)    0.1         -        (1.1)   1.6    10.6
 End of Period            $98.8   $43.8    $142.6        $226.0   $30.9       $8.3     $265.2  $35.4  $443.2
 ^(1)Includes index, enhanced index and factor-based strategies.
 ^(2)Includes asset allocation services and certain other alternative
 investments.
By Client Domicile
                                           Institutions  Retail   Private     Total
                                                                  Client
 U.S. Clients                              $134.8        $ 84.3   $66.5       $285.6
 Non-U.S. Clients                          90.3          66.1     1.2         157.6
 Total                                     $225.1        $150.4   $67.7       $443.2



AllianceBernstein L.P.
AUM by Distribution Channel and Investment
Service ($ in billions):
                       3/31/2013  12/31/2012  9/30/2012  6/30/2012  3/31/2012
    By Distribution
    Channel
      Institutions     225.1      219.8       214.4      214.9      222.3
      Retail           150.4      144.4       136.4      124.8      124.2
      Private Client   67.7       65.8        68.1       67.6       72.6
    Total              443.2      430.0       418.9      407.3      419.1
    By Investment
    Service
      Equity Active
           US          45.6       40.0        41.9       44.0       48.8
           Global &    53.2       55.4        58.4       63.4       76.0
           Non-US
           Total       98.8       95.4        100.3      107.4      124.8
      Equity
      Passive^(1)
           US          30.7       28.3        28.2       27.7       29.0
           Global &    13.1       12.0        8.5        7.4        7.5
           Non-US
           Total       43.8       40.3        36.7       35.1       36.5
      Fixed Income
      Taxable
           US          102.4      102.4       101.0      97.4       96.5
           Global &    123.6      121.6       111.2      99.7       93.6
           Non-US
           Total       226.0      224.0       212.2      197.1      190.1
      Fixed Income
      Tax-Exempt
           US          30.9       30.8        31.6       31.0       30.9
           Global &    -          -           -          -          -
           Non-US
           Total       30.9       30.8        31.6       31.0       30.9
      Fixed Income
      Passive^(1)
           US          2.9        2.5         2.3        1.6        1.4
           Global &    5.4        5.4         4.5        3.7        3.7
           Non-US
           Total       8.3        7.9         6.8        5.3        5.1
      Other^(2)
           US          3.4        3.2         2.9        4.1        4.4
           Global &    32.0       28.4        28.4       27.3       27.3
           Non-US
           Total       35.4       31.6        31.3       31.4       31.7
      Total            443.2      430.0       418.9      407.3      419.1
           (1)Includes index, enhanced index and factor-based strategies.
           (2)Includes asset allocation services and certain other
           alternative investments.

AllianceBernstein L.P.
Net Change by Distribution Channel and Net
Flows by Investment Service ($ in billions):
                        3/31/2013  12/31/2012  9/30/2012  6/30/2012  3/31/2012
       Net Change by
       Distribution
       Channel:
         Institutions   3.3        2.9         (7.7)      (3.7)      (12.9)
         Retail         0.2        5.3         5.0        3.5        2.3
         Private        (0.9)      (3.2)       (1.7)      (2.6)      (1.5)
         Client
       Net Flows        2.6        5.0         (4.4)      (2.8)      (12.1)
       Investment       10.6       6.1         16.0       (9.0)      25.3
       Performance
       Net change       13.2       11.1        11.6       (11.8)     13.2
                        3/31/2013  12/31/2012  9/30/2012  6/30/2012  3/31/2012
       Net Flows by
       Investment
       Service:
       Equity Active
         US             1.2        (2.1)       (4.4)      (2.0)      (4.6)
         Global &       (4.7)      (6.1)       (7.9)      (5.6)      (11.1)
         Non-US
         Total          (3.5)      (8.2)       (12.3)     (7.6)      (15.7)
       Equity
       Passive^(1)
         US             (0.6)      0.1         (1.2)      (0.4)      (1.2)
         Global &       0.9        3.1         0.6        0.3        0.3
         Non-US
         Total          0.3        3.2         (0.6)      (0.1)      (0.9)
       Fixed Income
       Taxable
         US             1.3        2.4         1.7        (0.9)      1.3
         Global &       1.9        7.8         6.8        5.7        0.7
         Non-US
         Total          3.2        10.2        8.5        4.8        2.0
       Fixed Income
       Tax-Exempt
         US             -          (1.0)       0.1        (0.2)      0.4
         Global &       -          -           -          -          -
         Non-US
         Total          -          (1.0)       0.1        (0.2)      0.4
       Fixed Income
       Passive^(1)
         US             0.4        0.1         0.7        0.2        (0.1)
         Global &       -          1.2         0.5        0.3        0.4
         Non-US
         Total          0.4        1.3         1.2        0.5        0.3
       Other^(2)
         US             -          0.3         (1.4)      (0.2)      0.3
         Global &       2.2        (0.8)       0.1        -          1.5
         Non-US
         Total          2.2        (0.5)       (1.3)      (0.2)      1.8
       Net Flows        2.6        5.0         (4.4)      (2.8)      (12.1)
         (1)Includes index, enhanced index and factor-based
         strategies. (2)Includes asset allocation services and
         certain other alternative investments.



AllianceBernstein L.P.
RECONCILIATION OF GAAP FINANCIAL RESULTS TO
ADJUSTED FINANCIAL RESULTS
                         Three Months Ended
 $ thousands,            3/31/13    12/31/12   9/30/12   6/30/12   3/31/12   12/31/11
 unaudited
 Net Revenues, GAAP      $          $          $         $         $         $
 basis                   709,122   704,607   708,158  642,163  681,809  624,978
  Exclude:
   Long-term incentive
  compensation-related   (6,029)    (2,385)    (6,374)   7,619     (15,570)  (9,386)
  investment (gains)
  losses
   Long-term incentive
  compensation-related   (269)      (1,222)    (300)     (344)     (380)     (2,226)
  dividends and interest
   90% of consolidated
  venture capital fund   1,220      2,027      3,634     907       (7,686)   3,116
  investment losses
  (gains)
  
  Distribution-related   (109,280)  (106,322)  (94,779)  (86,120)  (79,869)  (73,048)
  payments
   Amortization of
  deferred sales         (11,074)   (11,167)   (10,658)  (10,171)  (8,267)   (8,292)
  commissions
   Pass-through fees   (6,868)    (7,737)    (25,617)  (7,917)   (7,738)   (7,598)
  & expenses
 Adjusted Net Revenues   $          $          $         $         $         $
                         576,822   577,801   574,064  546,137  562,299  527,544
 Operating Income        $          $         $        $        $         $
 (Loss), GAAP basis      124,198   78,194    (55,821)  78,747   101,245  (540,246)
  Exclude:
   Long-term incentive
  compensation-related   (6,029)    (2,385)    (6,374)   7,619     (15,570)  (9,386)
  investment (gains)
  losses
   Long-term incentive
  compensation-related   (269)      (1,222)    (300)     (344)     (380)     (2,226)
  dividends and interest
   Long-term incentive
  compensation-related   5,605      1,892      5,986     (7,030)   14,009    (2,925)
  mark-to-market vesting
  expense (credit)
   Long-term incentive
  compensation-related   722        1,145      582       711       152       806
  dividends and interest
  expense
   2011 Compensation   -          -          -         -         -         587,131
  charge
   Net impact of
  long-term incentive    29         (570)      (106)     956       (1,789)   573,400
  compensation-related
  items
   Real estate         638        38,896     168,086   6,787     9,269     294
  charges
   Sub-total of     667        38,326     167,980   7,743     7,480     573,694
  non-GAAP adjustments
   Less: Net (loss)
  income of consolidated
  entities attributable  (1,485)    (2,300)    (4,003)   (1,276)   7,264     (3,552)
  to non-controlling
  interests
 Adjusted Operating      $          $          $         $        $         $ 
 Income                  126,350   118,820   116,162  87,766   101,461  37,000
 Operating Margin, GAAP
 basis excl.             17.7%      11.4%      n/m       12.5%     13.8%     n/m
 non-controlling
 interests
 Adjusted Operating      21.9%      20.6%      20.2%     16.1%     18.0%     7.0%
 Margin
AllianceBernstein
Holding L.P.
RECONCILIATION OF GAAP
EPU TO ADJUSTED EPU
                         Three Months Ended
 $ thousands except per
 Unit amounts,           3/31/13    12/31/12   9/30/12   6/30/12   3/31/12   12/31/11
 unaudited
 Net Income (Loss) -     $         $         $        $        $        $
 Diluted, GAAP basis     38,474    26,192    (23,142)  21,339   26,699   (199,463)
 Impact on net income of
 AllianceBernstein       214        13,573     59,589    2,838     2,741     206,341
 non-GAAP adjustments
 Adjusted Net Income -   $         $         $        $        $        $  
 Diluted                 38,688    39,765    36,447   24,177   29,440   6,878
 Diluted Net Income      $       $       $      $      $      $   
 (Loss) per Holding      0.38      0.26      (0.23)    0.21     0.26     (1.97)
 Unit, GAAP basis
 Impact of
 AllianceBernstein       -          0.14       0.59      0.03      0.03      2.04
 non-GAAP adjustments
 Adjusted Diluted Net    $       $       $      $      $      $   
 Income per Holding      0.38      0.40      0.36     0.24     0.29     0.07
 Unit

AllianceBernstein L.P.
Notes to Condensed Consolidated Statements of Income and Supplemental
Information
(Unaudited)

Adjusted Net Revenues
Adjusted net revenues exclude investment gains and losses and dividends and
interest on long-term incentive compensation-related investments, and 90% of
the investment gains and losses of our consolidated venture capital fund
attributable to non-controlling interests. In addition, adjusted net revenues
offset distribution-related payments to third parties as well as amortization
of deferred sales commissions against distribution revenues. We believe the
offset of distribution-related payments from net revenues is useful for our
investors and other users of our financial statements because such
presentation appropriately reflects the nature of these costs as pass-through
payments to third parties who perform functions on behalf of our sponsored
mutual funds and/or shareholders of these funds. Amortization of deferred
sales commissions is offset against net revenues because such costs, over
time, essentially offset distribution revenues earned by the company. We also
exclude additional pass-through expenses we incur (primarily through our
transfer agency) that are reimbursed and recorded as fees in revenues. During
the third quarter of 2012, we offset sub-advisory payments to third parties
against performance-based fees earned on the Public-Private Investment Program
(PPIP) fund we managed. These fees have no impact on operating income, but
they do have an impact on our operating margin. As such, we exclude these
fees from adjusted net revenues.

Adjusted Operating Income
Adjusted operating income represents operating income on a GAAP basis
excluding (1) the impact on net revenues and compensation expense of the
mark-to-market gains and losses (as well as the dividends and interest)
associated with employee long-term incentive compensation-related investments,
(2) the 2011 compensation charge, (3) real estate charges, and (4) the net
loss or income of consolidated entities attributable to non-controlling
interests.

Prior to 2009, a large proportion of employee compensation was in the form of
long-term incentive awards that were notionally invested in AllianceBernstein
investment services and generally vested over a period of four years.
AllianceBernstein has economically hedged the exposure to market movements by
purchasing and holding these investments on its balance sheet. The full value
of the investments' appreciation (depreciation) is recorded within investment
gains and losses on the income statement in the current period. U.S. GAAP
requires the appreciation (depreciation) in the compensation liability to be
expensed over the award vesting period in proportion to the vested amount of
the award as part of compensation expense. This creates a timing difference
between the recognition of the compensation expense and the investment gain or
loss impacting operating income, which will fluctuate over the life of the
award and net to zero at the end of the multi-year vesting period. Although
during periods of high market volatility these timing differences have an
impact on operating income and operating margin, over the life of the award
any impact is ultimately offset. Because these plans are economically hedged,
management believes it is useful to reflect the offset ultimately achieved
from hedging the investments' market exposure in the calculation of adjusted
operating income, adjusted operating margin and adjusted diluted net income
per Holding Unit, which will produce core operating results from period to
period. The non-GAAP measures exclude gains and losses and dividends and
interest on long-term incentive compensation-related investments included in
revenues and compensation expense, thus eliminating the timing differences
created by different treatment under U.S. GAAP of the market movement on the
expense and the investments. In the fourth quarter of 2011, we implemented
changes to our employee long-term incentive compensation award program. As a
result, mark-to-market investment gains or losses recognized in compensation
expense will closely approximate mark-to-market investment gains and losses
recognized in revenues.

Real estate charges have been excluded because they are not considered part of
our core operating results when comparing financial results from period to
period and to industry peers.

Most of the net income or loss of consolidated entities attributable to
non-controlling interests relates to the 90% limited partner interests held by
third parties in our consolidated venture capital fund. We own a 10% limited
partner interest in the fund. Because we are the general partner of the
venture capital fund and are deemed to have a controlling interest, U.S. GAAP
requires us to consolidate the financial results of the fund. However,
recognizing 100% of the gains or losses in operating income while only
retaining 10% is not reflective of our underlying financial results at the
operating income level. As a result, we are excluding the 90% limited partner
interests we do not own from our adjusted operating income. Similarly, net
income of joint ventures attributable to non-controlling interests, although
not significant, is excluded because it does not reflect the economic interest
attributable to AllianceBernstein.

Adjusted Operating Margin
Adjusted operating margin allows us to monitor our financial performance and
efficiency from period to period and to compare our performance to industry
peers without the volatility noted above in our discussion of adjusted
operating income. Adjusted operating margin is derived by dividing adjusted
operating income by adjusted net revenues.

SOURCE AllianceBernstein L.P.

Website: http://www.alliancebernstein.com
Contact: Andrea Prochniak, Investors, 212.756.4542,
Andrea.Prochniak@alliancebernstein.com, Jonathan Freedman, Media,
212.823.2687, Jonathan.Freedman@alliancebernstein.com
 
Press spacebar to pause and continue. Press esc to stop.