Blackstone Inc. Quarterly Report for Q2 Ended Jun 30, 2009

Summary

Blackstone Inc. (BX) reported its second quarter 2009 results, showing resilience amidst a challenging economic environment. Total revenues increased by 15% year-over-year to $406.4 million, primarily driven by growth in management and advisory fees, and a significant turnaround in performance fees and allocations which moved from a negative figure in the prior year to a positive $71.2 million. Despite a decline in investment income (loss), overall expense management was effective, with total expenses decreasing by 10% year-over-year to $1.05 billion. This led to a net loss attributable to Blackstone Group L.P. of $164.3 million, a slight increase from the prior year's $156.5 million, resulting in a net loss per common unit of ($0.60) for priority distribution units. The company maintained a strong liquidity position, ending the quarter with $784.6 million in cash and cash equivalents and an undrawn revolving credit facility.

Key Highlights

• 1Total revenues increased 15% to $406.4 million in Q2 2009, driven by growth in management and advisory fees and a positive swing in performance fees.
• 2Performance fees and allocations improved significantly, reaching $71.2 million in Q2 2009, compared to a loss of $13.7 million in Q2 2008.
• 3Total expenses decreased by 10% to $1.05 billion, reflecting effective cost management, particularly in compensation and benefits.
• 4The company ended the quarter with a healthy cash position of $784.6 million and an undrawn $850 million credit facility.
• 5Assets Under Management saw a decrease of 22% to $93.5 billion, reflecting challenging market conditions affecting portfolio valuations.
• 6Fee-Earning Assets Under Management also declined by 6% to $93.5 billion, impacted by market depreciation and the liquidation of proprietary hedge funds.
• 7The Financial Advisory segment showed strong revenue growth of 15%, boosted by increased activity in restructuring and M&A advisory services.

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