Private equity firm KKR & Co Inc said on Tuesday its fourth-quarter distributable earnings rose 4%, buoyed by strong growth in income from asset sales in addition to management and transaction fees.
After-tax distributable earnings, which represents the cash used to pay shareholder dividends, rose to $888.5 million from $851.9 million a year earlier. That resulted in distributable earnings per share of $1, which was higher than the mean Wall Street analyst estimate of 91 cents, according to LSEG data.
KKR said its net profit from asset sales surged 85% to $359.6 million during the quarter, with divestments across its private equity and infrastructure portfolios.
Fee-related earnings jumped 21% to $675.4 million, driven by higher management fee income and stronger revenue from transaction fees that KKR generates mainly by arranging financing for its own deals.
KKR’s private equity funds gained 3% in the fourth quarter, infrastructure funds were up 5%, while leveraged credit funds rose 3%. The value of its opportunistic real estate portfolio, however, fell 1%.
Blackstone Inc, the world’s largest private equity firm, also reported a 4% rise in its distributable earnings last week, as well as a 3.5% gain in the value of its corporate private equity funds and a 3.8% decline in its opportunistic real estate portfolio.
KKR’s net income under generally accepted accounting principles (GAAP) soared to $1 billion, up from $121.1 million a year earlier, driven by investment income from its asset management business.
KKR raised $31 billion of new capital, made investments worth $16 billion, retained nearly $100 billion of unspent capital, and had $553 billion of total assets under management. It declared a dividend of 16.5 cents per share.
Reuters