W.P. Stewart & Co., Ltd. Reports Net Income for Fourth Quarter and Full Year 2004of $21.8 Million and $63.1 Million

HAMILTON, Bermuda: Jan. 27 - W.P. Stewart & Co., Ltd. today reported net income of $21.8 million, or $0.48 per share (diluted)and $0.48 per share (basic), for the fourth quarter ended 31 December 2004. This compares with net income in the fourth quarter of the prior year of
$10.2 million, or $0.23 per share (diluted) and $0.23 per share (basic).

    Fourth Quarter 2004 Highlights
    For the fourth quarter of 2004 there were 45,676,651 common shares outstanding on a weighted average diluted basis compared to 45,390,736 common shares outstanding for the fourth quarter of 2003 on the same weighted average diluted basis.
    Cash earnings for the quarter ended 31 December 2004 were $23.9 million (net income of $21.8 million adjusted to include $2.1 million representing non-cash expenses of depreciation, amortization and other non-cash charges on
a tax-effected basis), or $0.52 per share (diluted). In the same quarter of the prior year, cash earnings were $12.0 million (net income of $10.2 million adjusted for the inclusion of $1.8 million representing non-cash expenses of depreciation, amortization and other non-cash charges on a tax-effected basis), or $0.26 per share (diluted). 
    Results for the fourth quarter include a performance fee of $13.5 million related to the performance, during 2004, of W.P. Stewart Holdings N.V., our mutual fund listed on Euronext Amsterdam. Performance fees, if any, are only recorded as of the date these are earned which, in the case of W.P. Stewart Holdings N.V., was 31 December for 2004.
    Assets under management at 31 December 2004 were more than $9.3 billion, compared to approximately $8.5 billion at the end of the prior quarter, an increase of 9.4% and an increase of 8.1% from the approximately $8.6 billion
reported at 31 December 2003.

    Full Year Results
    For the full year ended 31 December 2004, net income was up 46.6%, compared to the prior year, to $63.1 million, or $1.39 per share (diluted) and $1.40 per share (basic), on revenues of $152.3 million. Net income for the full year ended 31 December 2003 was $43.1 million, or $0.95 per share (diluted) and $0.97 per share (basic), on revenues of $118.8 million.
    Cash earnings for the full year ended 31 December 2004 were $71.2 million (net income of $63.1 million adjusted to include $8.1 million, representing non-cash expenses of depreciation, amortization and other non-cash charges on a tax-effected basis), or $1.56 per share (diluted). For the full year ended 31 December 2003, cash earnings were $50.4 million (net income of $43.1 million adjusted for the inclusion of $7.3 million, representing non-cash expenses of depreciation, amortization and other non-cash charges on a tax-effected basis), or $1.11 per share (diluted).
    For the full year ended 31 December 2004, there were 45,524,043 common shares outstanding on a weighted average diluted basis compared to 45,197,965 common shares outstanding for the same period in 2003 on the same weighted average diluted basis.

    Performance
    Performance in the W.P. Stewart & Co., Ltd. U.S. Equity Composite (the "Composite") for the fourth quarter of 2004 was +15.9%, pre-fee, and +15.7%, post-fee. For the full year ended 31 December 2004, performance in the
Composite was +20.4%, pre-fee, and +19.2%, post-fee. In each of the one,three, five and ten-year periods, ended 31 December 2004, performance of the Composite has exceeded the performance of the S&P 500 on a pre-fee and a post-fee basis.

    Assets Under Management
    Assets under management (AUM) at year-end were more than $9.3 billion,compared with approximately $8.5 billion at 30 September 2004, and approximately $8.6 billion reported at 31 December 2003.
    Total net flows of AUM for the quarter ended 31 December 2004 were approximately -$346 million, compared with total net flows of approximately -$187 million in the comparable quarter of 2003 and -$67 million in the third quarter of 2004. Total net flows of AUM for the year ended 31 December 2004 and 2003 were approximately -$621 million and approximately -$336 million, respectively.
    In the fourth quarter of 2004, net cash flows to existing accounts were approximately +$94 million, compared with net cash flows of -$43 million in the fourth quarter of 2003. Net cash flows to existing accounts were approximately +$60 million and approximately -$48 million for the full years ended 31 December 2004 and 2003, respectively.
    Net new flows (net contributions to our publicly available funds and flows from new accounts minus closed accounts) were approximately -$440 million for the quarter, compared to approximately -$144 million for the same quarter of the prior year. Net new flows were approximately -$681 million and approximately -$288 million for the full years ended 31 December 2004 and
2003, 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 history,the growth in earning power behind clients' portfolios has ranged from
approximately 11% to 22%, annually.
    Currently, portfolio earnings growth remains solidly positive and the Company's research analysts expect portfolio earnings growth to be within the historical range over the next few years.

    Revenues and Profitability
    Revenues were $48.4 million for the quarter ended 31 December 2004, up 65.1% from $29.3 million, for the same quarter of 2003. Revenues for the full years ended 31 December 2004 and 2003 were $152.3 million and $118.8 million,respectively.
    The average gross management fee, excluding performance fees, was 1.18% for the quarter ended 31 December 2004 and 1.19% for the year ended 31 December 2004, compared to 1.21% and 1.22% in each of the comparable periods of the prior year.
    Total operating expenses increased 38.2% to $23.4 million, for the fourth quarter 2004, from $16.9 million in the same quarter of the prior year. Total operating expenses were $81.3 million and $69.7 million for the full years ended 31 December 2004 and 2003, respectively.
    Pre-tax income, at $25.1 million, was 51.7% of gross revenues for the quarter ended 31 December 2004, compared to $12.4 million or 42.3% of gross revenues in the comparable quarter of the prior year. Pre-tax income was $71.0 million (46.6 % of gross revenues) for the full year ended 31 December 2004,and $49.1 million (41.3% of gross revenues) for the full year ended 31 December 2003.
    The Company's provision for taxes for the quarter ended 31 December 2004 was $3.3 million versus $2.2 million in the comparable quarter of the prior year, and was $7.9 and $6.0 million for the years ended 31 December, 2004 and 2003, respectively. The tax rate was approximately 11.1% and 12.2% of income before taxes for the full years ended 31 December 2004 and 2003, respectively. The higher than previously anticipated tax rate reflects the performance fee earned on 31 December and the fact that a portion is being taxed as U.S.
effectively connected business income.

    Other Events
    The Company paid a dividend of $0.30 per common share on 29 October 2004 to shareholders of record as of 15 October 2004 and will pay a dividend of $0.30 per share on 28 January, 2005 to shareholders of record as of 14
January, 2005.

    Conference Call
    In conjunction with this fourth quarter 2004 earnings release, W.P. Stewart & Co., Ltd. will host a conference call on Thursday, 27 January 2005.The conference call will commence promptly at 9:15am (EST) and will conclude
at 10:00am (EST). Those who are interested in participating in the teleconference should dial 1-800-370-0898 (within the United States) or +973-409-9260 (outside the United States). The conference ID is "W.P.
Stewart".
    To listen to the live broadcast of the conference over the Internet, simply visit our website at http://www.wpstewart.com and click on the Investor
Relations tab for a link to the web-cast.
    The teleconference will be available for replay from Thursday 27 January, 2005 at 12:00 noon (EST) through Friday, 28 January, 2005 at 5:00 p.m. (EST).To access the replay, please dial 1-877-519-4471 (within the United States) or + 973-341-3080 (outside the United States). The PIN number for accessing this  replay is 5589280.
    You will be able to access a replay of the Internet broadcast through Thursday, 3 February, 2005, on the Company's website at http://www.wpstewart.com . The Company will respond to questions submitted by e-mail, following the conference.
    W.P. Stewart & Co., Ltd. is an asset management company that has provided research-intensive equity management services to clients throughout the world
since 1975. The Company is headquartered in Hamilton, Bermuda and has additional operations or affiliates in the United States, Europe and Asia.
    The Company's shares are listed for trading on the New York Stock Exchange (symbol: WPL) and on the Bermuda Stock Exchange (symbol: WPS).
    For more information, please visit the Company's website at http://www.wpstewart.com , or call W.P. Stewart Investor Relations (Fred M. Ryan) at 1-888-695-4092 (toll-free within the United States) or + 441-295-8585 (outside the United States) or e-mail to IRINFO@wpstewart.com .

    Statements made in this release concerning our assumptions, expectations, beliefs, intentions, plans or strategies are forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve risks and uncertainties that may cause actual results to differ from those expressed or implied in these statements. Such risks and uncertainties include, without limitation, the adverse effect from a decline or volatility in the securities markets, a general downturn in the economy,
the effects of economic, financial or political events, a loss of client accounts, inability of the Company to attract or retain qualified personnel, a challenge to our U.S. tax status, competition from other companies, changes in government policy or regulation, a decline in the Company's products' performance, inability of the Company to implement its operating strategy,inability of the Company to manage unforeseen costs and other effects related to legal proceedings or investigations of governmental and self-regulatory organizations, industry capacity and trends, changes in demand for the Company's services, changes in the Company's business strategy or development plans and contingent liabilities. The information in this release is as of the date of this release, and will not be updated as a result of new information or future events or developments.