Private Equity Giant Blackstone Reports Third Quarter Earnings

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Private Equity Giant Sees Big Jump in Fee-Related Earnings

Private equity company Blackstone Group reported earnings for the third quarter of 2019.

GAAP net income was $1.2 billion for the quarter and $2.9 billion year-to-date. Revenues were down with $1,735,113 versus $1,926,580 in the comparable quarter last year. Distributable earnings per share came in at 58 cents. That figure is higher than the 53 cents that analysts estimated on average, according to Refinitiv. Fee-related earnings came in at $440 million ($0.37/share) in the quarter, up 27%-year-over-year. That figure was $1.7 billion for the LTM ($1.39/share), up 21% year-over-year. Total assets under management rose to $554.0 billion, up 21% year-over-year.

Breakdown of Private Equity Company Blackstone Earnings

Blackstone continues to share the wealth with shareholders as they declared a dividend of Dividend of $0.49 per common share payable on November 12, 2019. The firm has paid out dividends of $1.92 per common share over the past year. Blackstone also repurchases 2.8 million common shares in the quarter and 19.1 million common shares for the last 12 months. Over $700 million was distributed with respect to the third quarter to shareholders through dividends and share repurchases, and over $3.0 billion for the last year. Blackstone’s intention is to issue a dividend quarterly to common shareholders approximately 85% of The Blackstone Group’s share of Distributable Earnings each quarter.

Real Estate was the star this quarter with a 31% jump in assets under management. Blackstone closed on Blackstone Real Estate Partners IX with over $20 billion raised making it the largest real estate fund ever. They also raised $2.4 billion in BREIT and $1.1 billion in the sixth European opportunistic fund. They have not been shy about deploying the capital as so far, they $8.2 billion in the quarter and $20.9 billion for the LTM; deployment in the quarter included the acquisition of GLP’s U.S. industrial portfolio, the largest private real estate transaction ever. Committed an additional $4.0 billion during the quarter that is not yet deployed, including the acquisition of a 62 million square foot last-mile logistics portfolio.

Blackstone did a little selling in the quarter as they sold $4.6 billion in the quarter and $15.3 billion for the LTM; realizations in the quarter included a secondary share sale of Invitation Homes and the sale of the final office asset in Equity Office Properties.

Private Equity Performance

Private Equity has a strong performance as well with assets increasing 38% to $173.9 billion with inflows of $3.3 billion in the quarter and $58.4 billion for the LTM. New capital hit $2.9 billion thanks to Corporate Private Equity and Tactical Opportunities.

The firm invested $5.8 billion in the quarter and $27.7 billion for the LTM across regions. Blackstone has also committed an additional $2.6 billion in undeployed capital for the quarter. They also sold a few assets with realizations of $2.8 billion in the quarter, including both public and private sales, and $14.5 billion for the last year.

“In the third quarter Blackstone again generated strong results for our investors, who in today’s challenging environment look to our firm as a critical solutions provider,” said Stephen A. Schwarzman, Blackstone Chairman and CEO. “Our ability to execute on scale investment opportunities across a broad array of strategies is highly differentiated, as demonstrated by $16 billion of deployments in the quarter and a record $62 billion over the last twelve months. Our investors continue to entrust us with capital for both new and existing strategies, including nearly $150 billion of inflows during the last year, culminating in industry-record Total Assets Under Management of $554 billion, up 21%-year-over-year.”

We will report more on the private equity firm Blackstone Group tomorrow morning.

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