Fee Revenue Boosts Blackstone Q1 Results

Banking, finance, and taxes

Published: April 23, 2020 9:49 am

Blackstone Group Inc. (NYSE: BX) reported first-quarter 2020 results Thursday before markets opened. Including unrealized investment losses of $4.2 billion, the firm’s net loss for the quarter totaled $2.6 billion and the loss per share on a GAAP basis was $1.58.

Distributable earnings totaled $557.1 million ($0.46 per share), below a consensus estimate of $0.50. Fee revenues rose from $809.7 million in the year-ago quarter to $934.8 million and fee-related earnings rose 25% to $0.39 per share year over year. Net accrued performance revenues for the trailing 12 months totaled $2.2 billion. In the first quarter of 2019, net accrued performance revenues totaled $3.8 billion.

Total assets under management closed the quarter at $538.0 billion, up 5% year over year, and fee-earning assets under management rose 20% to $423.1 billion.

In the first quarter, Blackstone distributed more than $700 million in dividends and buybacks, raising the firm’s total for the past 12 months to $3.2 billion.

Stephen Schwarzman, board chair and chief executive, commented:

Blackstone’s first-quarter financial results reflect the unprecedented market and global economic conditions caused by the COVID-19 pandemic. … Throughout our firm’s 35-year history, we have weathered many difficult periods – including the global financial crisis – only to emerge stronger than before. Our experience has shown that although asset values may be temporarily marked down, strong assets ultimately recover. We entered this crisis in a position of great strength, having recently completed a two-year fundraising cycle of nearly $250 billion. With ample capital reserves, long-term fund structures, and over $150 billion of dry powder capital – more than anyone in our industry – we are uniquely positioned to invest on behalf of our clients at a time of historic dislocation.

The only first-quarter investment that appreciated was private equity secondary offerings, and they were up less than 2%. Corporate private equity posted negative appreciation of 21.6%.

Analysts have estimated second-quarter distributions per share of $0.46 and full-year distributions of $2.19 per share.

Shortly after the opening bell, Blackstone traded up about 2.2%, at $47.35 in a 52-week range of $33.00 to $64.97. The consensus price target on the stock is $55.46, and the dividend yield at an annual payout of $2.44 is 5.27%.