Blackstone Inc. the leading global alternative asset manager reported net profit of 2.0 billion USD on 10.3 billion USD in revenues in the second quarter 2024.
Blackstone, Inc, along with other leading alternative asset managers like KKR & Co, Apollo and Carlyle has a large insurance subsidiary, held for its own account basically. Blackstone uses the long-term proceeds from insurance premiums from its insurance business to invest in the private equity, real estate and private credit and lending and multi-asset investing business lines of Blackstone, according to Wolfteam Ltd.'s analysis estimates. The advantage of the insurance premiums income is that it is long-term, stable in nature. Thus Blackstone is independent of the short-term fluctuations of the equity market. Private equity, due to its equity component is notoriously dependent on stock market price swings. With the insurance premiums however and their long-term nature Blackstone avoids private equity being a beta product on the Standard and Poor's 500 and other equity capital markets businesses.
$ in thousands, except per share data) (unaudited) 2Q'23 2Q'24 2Q'23 YTD 2Q'24 YTD 2Q'23 LTM 2Q'24 LTM
Revenues
Management and Advisory Fees, Net 1,709,370$ 1,787,313$ 3,367,685$ 3,514,461$ 6,633,877$ 6,818,036$
Incentive Fees 153,077 188,299 295,953 367,640 616,993 766,858
Performance Allocations 616,479 653,870 504,161 1,752,330 405,208 1,780,342
Principal Investments 218,924 42,269 (164,435) 582,489 (1,001,693) 447,593
Interest and Dividend Revenue 148,505 104,999 238,990 202,838 394,042 480,345
Other (31,664) 19,631 (45,818) 64,451 (89,718) 17,340
Total Revenues 2,814,691$ 2,796,381$ 4,196,536$ 6,484,209$ 6,958,709$ 10,310,514$
Expenses
Compensation and Benefits 1,060,595 1,206,202 1,823,706 2,514,506 3,088,003 4,003,770
General, Administrative and Other 275,034 311,928 548,428 681,878 1,111,137 1,250,755
Interest Expense 108,096 108,616 212,537 216,819 393,373 436,150
Fund Expenses 31,585 5,960 79,984 9,910 104,032 48,913
Total Expenses 1,475,310$ 1,632,706$ 2,664,655$ 3,423,113$ 4,696,545$ 5,739,588$
Other Income (Loss) 87,595$ 44,934$ 153,451$ 27,167$ 123,294$ (210,281)$
Income Before Provision for Taxes 1,426,976$ 1,208,609$ 1,685,332$ 3,088,263$ 2,385,458$ 4,360,645$
Provision for Taxes 223,269 260,246 270,944 543,917 224,029 786,434
Net Income 1,203,707$ 948,363$ 1,414,388$ 2,544,346$ 2,161,429$ 3,574,211$
Redeemable NCI in Consolidated Entities 17,688 258 10,988 (39,411) (162,829) (295,917)
Non-Redeemable NCI in Consolidated Entities 584,745 503,691 716,314 1,291,957 1,077,022 1,874,534
Net Income Attributable to Blackstone Inc. (''BX'') 601,274$ 444,414$ 687,086$ 1,291,800$ 1,247,236$ 1,995,594$
Net Income Per Share of Common Stock, Basic 0.79$ 0.58$ 0.91$ 1.69$ 1.67$ 2.62$
Net Income Per Share of Common Stock, Diluted 0.79$ 0.58$ 0.91$ 1.69$ 1.67$ 2.62
What is more the stable insurance premiums investment pool of Blackstone constitutes 41 % of all the investment funds gathered by Blackstone:
Total AUM increased to $1,076.4 billion, up 7% year-over-year, with $39.4 billion of inflows in the quarter
and $151.5 billion over the LTM.
▪ Fee-Earning AUM of $808.7 billion was up 11% year-over-year, with $53.0 billion of inflows in the quarter
and $151.5 billion over the LTM.
▪ Perpetual Capital AUM reached $418.6 billion, up 9% year-over-year.
– Fee-Earning Perpetual Capital AUM increased to $361.9 billion, representing 45% of Fee-Earning AUM.
While total 'dry powder', capital available for investments is 18 % of the total:
Invested Performance Eligible AUM reached $531.3 billion at quarter end.
▪ Undrawn capital (“Total Dry Powder”) available for investment of $181.0 billion.
The revenue of Blackstone for the second quarter of 2024 compared with the second quarter of 20223 increased by more 47 % or the increase was with nominal 3.3 billion USD due to higher performance fees and principal investments revenues.
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