Annual Report 2011

Annual Report 2011

Table of Contents 02 Business Highlights 03 Financial Highlights 04 Letter to Shareholders 10 Our Business 14 Asset Classes 18 Investment Styles 22 BlackRock Solutions and Advisory 24 Global Executive Committee 25 Board of Directors 26 Financial Information 122 Important Notes 123 Common Stock Information IBC Corporate Information

investing for a new world.

BlackRock's mission is to help our clients see beyond short-term challenges to build a better financial future for themselves and those they serve. For 24 years, we've shaped our firm around our clients' needs. We have brought together an unparalleled range of active and passive investment strategies, including our industryleading iShares? exchange traded products, and deep knowledge and expertise that spans asset classes, geographies and sectors?all backed by the world-class risk management capabilities of BlackRock Solutions? and a singular focus on investment performance. We continue to shape and strengthen BlackRock to deliver attractive, long-term returns for our clients and shareholders.

BlackRock was built for these times.

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business highlights

2011 RESULTS

CONTINUED GROWTH IN EARNINGS AND MOMENTUM Grew revenue 5% to $9.1 billion despite market disruption, demonstrating the strength of our diversified platform.

Achieved a 7% increase in adjusted operating income to $3.4 billion, reflecting twin focus on new business efforts and strong expense management discipline.

Improved the adjusted operating margin by 40 bps to 39.7% ? 306 bps above the peer average.

Increased diluted EPS, as adjusted by 8% to $11.85.

Generated $2.6 billion in adjusted operating cash flow, enabling us to increase our dividend by 38% and repurchase 14.2 million shares while continuing to reinvest in our business.

STRONG FOCUS ON SERVING CLIENTS Maintained an unwavering focus on investment performance ? 72% of active AUM outperformed benchmarks/peer medians and 95% of index AUM at or above tracking error tolerances over the 5-year period.

Launched "Investing for a New World" initiative in early 2012 to build the BlackRock brand and provide clients practical advice for building more dynamic, diverse portfolios to meet their needs.

Awarded $67.3 billion in net new business in long-term investments by clients, ending 2011 with $3.138 trillion in equity, fixed income, multi-asset and alternatives AUM.

Managed $2.516 trillion in AUM for institutional clients at year end, bringing the full range of our capabilities to bear for investors in more than 100 countries on six continents.

Added net new business of $31.2 billion in defined contribution to bring total AUM to $330.1 billion and solidify our position as the leading investment-only provider in the United States.

Managed $403.7 billion of AUM for retail and high net worth investors with continued growth in the United States, as we more than doubled our market share of long-term mutual fund flows.

DELIVERING AN UNPARALLELED RANGE OF PRODUCTS FOR THE NEW WORLD Added $70.1 billion of net inflows in passive strategies benefiting from the growing demand for index strategies and exchange traded products ("ETPs") across our uniquely diversified investment platform.

Remained the world's top ETP manager as iShares gained $53.0 billion of net inflows, with year-end AUM of $593.4 billion and the most comprehensive and most liquid product offering.

Generated record revenues of $510 million in BlackRock Solutions as more institutions across the globe sought our world-class risk management and advisory services.

Produced 23% organic growth in multi-asset, ending the year with $225.2 billion of AUM in asset allocation portfolios, target-date/target-risk funds and fiduciary management assignments.

Continued growth in alternatives capabilities, ending the year with $104.9 billion in AUM and a robust platform of hedge funds, funds of funds, real estate, private equity and renewable power.

Please review the Important Notes on page 122 for information regarding adjustments to certain figures shown above and on page 3, as well as source information. 2

financial highlights

(in millions of dollars, except per share data)

Revenue Net Income Operating Income, as adjusted Operating Margin, as adjusted Net Income, as adjusted

Per Share: Diluted Earnings Diluted Earnings, as adjusted Dividends Declared Book Value

Assets Under Management

2011

2010

2009

2008

2007

$ 9,081 $ 8,612 $ 4,700 $ 5,064 $ 4,845

2,337

2,063

875

784

993

3,392

3,167

1,570

1,662

1,518

39.7 %

39.3 %

38.2%

38.7%

37.4 %

$ 2,239 $ 2,139 $ 1,021 $

856 $ 1,077

$ 12.37 11.85 5.50

$ 140.07

$ 10.55 10.94 4.00

$ 136.09

$

6.11

7.13

3.12

$ 128.86

$ 5.78 $ 6.30 3.12

$ 92.91 $

7.37 7.99 2.68 90.16

$3,512,681 $3,560,968 $3,346,256 $1,307,151 $1,356,644

$9.081 Billion in Revenue

Other Revenue

Alternatives Base Fees Multi-asset Base Fees

Fixed Income Base Fees

17% 8% 10%

18%

Equity Base Fees

47%

Other Revenue

iShares Base Fees

17% 25%

Retail/HNW Base Fees

29%

Institutional Base Fees

29%

Other Revenue

17%

Institutional Index Base Fees

8%

iShares Base Fees

25%

Active Base Fees

50%

Other Revenue

Asia-Pacific Base Fees

EMEA Base Fees

17% 8% 23%

Americas Base Fees

52%

Product

Client Type

Style

Region

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