first quarter of the year as the downturn in world stock markets affected its earning power.

But the Bermuda-based company said it still performed better than many of its peers.

Net income for the company was reported at $23.3 million, or $0.49 per diluted share and $0.53 per basic share, for the first quarter ended March 31, 2001.

This compares with net income in the first quarter of 2000 of $26.6 million or $0.59 per diluted share and $0.64 per basic share.

Cash earnings for the quarter ended March 31, 2001, which exclude non-cash expenses such as depreciation and amortisation, on a tax-effected basis, were $24.9 million, or $0.53 per diluted share, compared with $28.3 million, or $0.63 per share in the same quarter of the prior year.

W.P. Stewart, which is listed on the New York Stock Exchange and on the Bermuda Stock Exchange, said for the first quarter of 2001 there were 47,315,118 common shares outstanding on a weighted average fully diluted basis compared to 45,187,857 common shares outstanding for the first quarter of 2000 on the same weighted average fully diluted basis.

Performance in the W.P. Stewart & Co., Ltd. US equity composite for the first quarter of 2001 was substantially better than the Standard & Poors (S&P) 500, at minus 6.9 percent pre-fee and minus 7.2 percent post-fee, compared with minus 11.9 percent for the broad market average.

W.P. Stewart's five-year performance record for the period ended 31 March 2001 averaged 18.4 percent pre-fee (17.1 percent post-fee), compounded annually, compared to an average of 14.2 percent for the S&P 500 in the period, and is substantially ahead of the Company's five-year pre-fee goal of 15 percent compounded annually.

Assets under management at quarter-end were $9.3 billion, compared with $10.3 billion at December 31, 2000, and $11.6 billion at March 31, 2000. Assets under management at April 30, 2001 were approximately $10 billion, an increase of just over $0.7 billion from the end of the first quarter.

In the first quarter of 2001, net cash outflows from existing accounts were approximately 1.5 percent, compared with approximately two percent in the first quarter of 2000.

Net new account flows (new accounts minus closed accounts) were minus $137 million for the quarter compared to minus $402 million for the same quarter of the prior year.

W.P. Stewart said it concentrates its investments in large, generally less cyclical, growing businesses. Annual growth in earning power behind clients' portfolios has ranged from approximately 11 percent to 22 percent over the past 26 years.