KKR & Co. Inc. Quarterly Report for Q3 Ended Sep 30, 2015

Summary

KKR & Co. Inc. reported a net loss attributable to KKR & Co. L.P. of $190.6 million for the third quarter of 2015, a significant decrease from the net income of $89.9 million reported in the same period of the prior year. This decline was primarily driven by a substantial net loss from investment activities, totaling $1.14 billion in Q3 2015, compared to a net investment income of $1.06 billion in Q3 2014. The Private Markets segment experienced a notable drop in performance income, largely due to unrealized carried interest losses, and a decrease in transaction and monitoring fees. The Public Markets segment also saw a decline in performance income and a significant increase in net unrealized losses. Despite these challenges, KKR announced a new distribution policy to pay $0.16 per common unit quarterly, starting in 2016, and authorized a $500 million unit repurchase program, indicating management's confidence in future performance and commitment to returning capital to shareholders.

Key Highlights

• 1KKR reported a net loss attributable to KKR & Co. L.P. of $190.6 million for Q3 2015, a significant shift from the net income of $89.9 million in Q3 2014.
• 2Total investment income (loss) for Q3 2015 was a loss of $1.14 billion, a stark contrast to the $1.06 billion income in Q3 2014, primarily due to a $1.56 billion net loss from investment activities.
• 3The Private Markets segment saw a decrease in total segment revenues, largely driven by a substantial drop in transaction fees and a decline in monitoring fees, though management fees increased.
• 4Performance income in the Private Markets segment turned negative at $(128.8) million due to unrealized carried interest losses, compared to positive $289.9 million in the prior year.
• 5The Public Markets segment also experienced a decline in segment revenues, primarily due to lower performance income and a significant increase in net unrealized losses from investment activities.
• 6KKR announced a new distribution policy of $0.16 per common unit per quarter, effective early 2016, and authorized a $500 million unit repurchase program, signaling a focus on capital return to shareholders.
• 7Assets Under Management (AUM) in the Private Markets segment decreased slightly to $60.8 billion, primarily due to distributions, while AUM in the Public Markets segment decreased to $37.9 billion, mainly due to distributions and redemptions.

Frequently Asked Questions