W.P. Stewart Reports Net Income for Fourth Quarter

$26.6 million or $0.57 per share (diluted) and $0.63 per share (basic).

Fourth Quarter 2001 Highlights

For the fourth quarter of 2001 there were 46,789,769 common shares outstanding on a weighted average diluted basis compared to 46,271,520 common shares outstanding for the fourth quarter of 2000 on the same weighted average diluted basis.

Cash earnings for the quarter ended 31 December 2001, net income adjusted to include non-cash expenses of depreciation and amortization, on a

tax-effected basis, were $19.4 million, or $0.42 per share (diluted), compared with $28.4 million, or $0.61 per share (diluted) in the same quarter of the prior year.

Assets under management at quarter-end were $9.2 billion, reflecting an increase of $1.0 billion from the end of the prior quarter, and a decline of $1.1 billion from 31 December 2000.

Full Year Results

For the full year ended 31 December 2001, net income was down 19.0% to $80.3 million, or $1.71 per share (diluted) and $1.85 per share (basic), on revenues of $160.7 million. Net income in 2000 was $99.1 million, or $2.18 per share (diluted) and $2.37 (basic), on revenues of $203.3 million.

Cash earnings, net income adjusted to include non-cash expenses of depreciation and amortization, on a tax-effected basis, for 2001 were

$87.2 million, or $1.86 per share (diluted), versus $105.9 million, or $2.33 per share (diluted), in the same period of the prior year.

For the full year 2001, there were 46,942,691 common shares outstanding on a weighted average diluted basis compared to 45,523,621 common shares

outstanding for the same period in 2000 on the same weighted average diluted basis.

Performance

Performance in the W.P. Stewart & Co., Ltd. U.S. equity composite for the fourth quarter of 2001 was 13.6% pre-fee, versus 10.7% for the S&P 500. For the full year ended 31 December 2001, the Company's performance was -5.8% pre-fee and -6.9% post-fee, compared with -11.9% for the broad market average.

W.P. Stewart's five-year performance record for the period ended 31 December 2001 averaged 12.8% pre-fee (11.5% post-fee), compounded annually.

Assets Under Management

Assets under management (AUM) at year-end were $9.2 billion, compared with $8.2 billion at 30 September 2001, and $10.3 billion at the quarter ended 31 December 2000.

Net flows for the quarter ended 31 December 2001 were -$140 million, compared with -$219 million in the comparable quarter of 2000. Net flows forthe full year 2001 were -$359 million, compared with -$1.3 billion for 2000.

In the fourth quarter of 2001, net cash flows from existing accounts were approximately -$66 million compared with approximately -$113 million in the fourth quarter of 2000. Net cash outflows from existing accounts for the year

ended 31 December 2001 and 2000, respectively, were -$119 million and-$594 million.

Net new account flows (new accounts minus closed accounts) were-$74 million for the quarter compared to -$106 million for the same quarter of

the prior year. Net new account flows were -$240 million and -$722 million for the year ended 31 December 2001 and 2000, respectively.

Look Through Earning Power

W.P. Stewart & Co., Ltd. concentrates its investments in large, generally less cyclical, growing businesses. Throughout most of the Company's 27-year history, the growth in earning power behind clients' portfolios has ranged

from approximately 11% to 22% annually.

The extraordinary combination of economic and political events in 2001 resulted in the growth in portfolio earning power in 2001 dropping below the historical range. However, portfolio earnings growth remained solidly positive in 2001 and significantly outperformed that of the S&P Industrials, and the Company's research analysts expect portfolio earnings growth to be

within the historical range over the next five years.

Revenues and Profitability

Revenues were $35.4 million for the quarter ended 31 December 2001, down 31.7%, from $51.8 million, for the same quarter of 2000. Revenues for the

year ended 31 December 2001 and 2000 were $160.7 million and $203.3 million, respectively.

The average gross management fee was 1.28% for the quarter ended 31 December 2001 and 1.26% for the year ended 31 December 2001, compared to

1.28% and 1.27% in the comparable periods of the prior year. The average fee was less than our standard fee of 1.5% because a number of advisory contractswere entered into prior to 1989, when we adopted our current fee arrangement, and because account balances in excess of $25 million are subject to a lower fee.

Total operating expenses decreased 20.2%, to $17.7 million, for the fourth quarter 2001, from $22.2 million in the same quarter of the prior year. Total operating expenses were $73.3 million and $93.1 million for the year ended

31 December 2001 and 2000, respectively.

Pre-tax income, at $17.6 million, was 49.9% of gross revenues for the quarter ended 31 December 2001 compared to $29.6 million or 57.1% of gross revenues in the comparable quarter of the prior year. Pre-tax income was

$87.4 million (54.4% of gross revenues) for the year ended 31 December 2001, and $110.2 million (54.2% of gross revenues) for the year ended 31 December 2000.

The Company's provision for taxes for the quarter ended 31 December 2001 was $0.2 million versus $3.0 million in the comparable quarter of the prior year, and was $7.2 million versus $11.0 million for the year ended 31 December

2001 and 2000, respectively. The effective tax rate for 2001 was 8.2%. This is the result of our anticipated 10% tax rate for 2001, less an adjustment in our prior year tax accrual determined when our tax returns were finalized in

December 2001.

Other Events

During the fourth quarter of 2001, the Company repurchased an aggregate of 204,988 common shares of the Company in private and open market transactionsfor an aggregate purchase price of $4,100,120. The aggregate amount of such

repurchases for the full year 2001 was 1,357,545 shares at an aggregate purchase price of $26,146,697.

The Company will pay a dividend of $0.30 per common share on 31 January 2002 to shareholders of record as of 18 January 2002.