10-QPeriod: Q1 FY2017

Blackstone Inc. Quarterly Report for Q1 Ended Mar 31, 2017

Filed May 9, 2017For Securities:BX

Summary

Blackstone Inc. (BX) reported strong financial performance for the quarter ended March 31, 2017, with total revenues significantly increasing by 108% year-over-year to $1.94 billion. This growth was primarily driven by a substantial surge in Performance Fees, up 238% to $1.06 billion, and a notable increase in Investment Income, which swung from a net loss of $8.5 million in the prior year to a gain of $211.2 million. Management and Advisory Fees also saw a healthy 5% increase to $642.1 million. The company's Net Income attributable to The Blackstone Group L.P. grew by an impressive 189% to $461.8 million, translating to diluted earnings per common unit of $0.69, a significant improvement from $0.23 in the prior year's quarter. The company also reported robust growth in Assets Under Management (AUM), with Fee-Earning AUM reaching $280.2 billion and Total AUM at $368.2 billion, indicating continued success in capital raising and investment deployment across its four business segments: Private Equity, Real Estate, Hedge Fund Solutions, and Credit.

Financial Highlights

33 data points
Beta

Revenue

$1.91B

Net Income

$451.91M

23.6% Net Margin

EPS (Diluted)

$0.68

Total Assets

$28.34B

Cash & Equivalents

$2.30B

Free Cash Flow

$542.47M

Financial Statements
Beta
Revenue$1.91B
Operating Expenses-$921.77M
Interest Expense$40.25M
Net Income$451.91M
EPS (Basic)$0.68
EPS (Diluted)$0.68
Shares Outstanding (Basic)660.94M
Shares Outstanding (Diluted)1.20B

Key Highlights

  • 1Total Revenues surged by 108% year-over-year to $1.94 billion, driven by strong performance across all segments.
  • 2Performance Fees more than tripled, increasing by 238% to $1.06 billion, reflecting strong investment gains.
  • 3Investment Income turned positive, reaching $211.2 million compared to a net loss of $8.5 million in the prior year's quarter.
  • 4Net Income attributable to The Blackstone Group L.P. grew by 189% to $461.8 million.
  • 5Diluted Earnings Per Common Unit increased significantly to $0.69 from $0.23 in the prior year quarter.
  • 6Fee-Earning Assets Under Management grew to $280.2 billion, and Total Assets Under Management reached $368.2 billion.
  • 7The company maintained a strong liquidity position with $2.3 billion in cash and cash equivalents and no borrowings under its revolving credit facility.

Frequently Asked Questions

The significant revenue increase was primarily driven by a substantial rise in Performance Fees, which grew by 238% to $1.06 billion, and a strong positive swing in Investment Income from a net loss of $8.5 million in Q1 2016 to a gain of $211.2 million in Q1 2017. These were complemented by a 5% increase in Management and Advisory Fees.

Blackstone's profitability saw a dramatic improvement. Net Income attributable to The Blackstone Group L.P. increased by 189% to $461.8 million, leading to a substantial rise in diluted earnings per common unit to $0.69, up from $0.23 in the prior year's quarter. This growth was largely fueled by increased performance fees and positive investment income.

Blackstone continued to grow its AUM. Fee-Earning Assets Under Management increased to $280.2 billion, and Total Assets Under Management reached $368.2 billion by the end of Q1 2017. This growth reflects successful capital raising and investment deployment across its key business segments.

Blackstone reported a strong liquidity position with $2.3 billion in cash and cash equivalents as of March 31, 2017. The company had no outstanding borrowings under its $1.5 billion revolving credit facility. Its total liabilities increased primarily due to higher Loans Payable, largely from new CLO vehicles. The company's primary liquidity needs are expected to be met through operating cash flows, capital realizations, and available credit facilities.