KKR posts modest growth for Q3

The US-listed giant said the value of its private equity portfolio has increased 19% in the last year

Kohlberg Kravis Roberts saw net income fall 17 percent year-on-year in the third quarter, it said today.

In its third quarter results, released today, the firm reported economic net income (ENI) for the three-month period of $508.7 million, down from $613.7 million in Q3 of last year.

However, ENI for the nine months to 30 September 2014 was $1.64 billion, up almost 17 percent on the $1.41 billion recorded in for the equivalent period in 2013.

KKR said the carrying value of its private equity portfolio appreciated 2.2 percent in the quarter, 10.5 percent in the first three quarters of this year, and 19.2 percent in the twelve months to 30 September 2014.

Total distributable earnings for the quarter more than doubled to $504.8 million from $251.1 million for the same period last year, with total cash revenue for the period up 74 percent to $800 million. Distribution per common unit was up 68 percent to $1.55 for the nine months to 30 September, from $0.92 the previous year.

In the twelve months to 30 September, the firm’s investment portfolio and balance sheet have generated a 25 percent return on equity and a 23 percent cash return on equity, up from 23 percent and 20 percent respectively a year ago.

In its announcement, KKR declared a dividend of $0.45 per share, which includes $0.18 of realized cash carry. This is the 18th consecutive quarter that realised cash carry has been a component of the dividend, according to the firm.

KKR’s profit growth has slowed since the second quarter of 2014, in which it declared a dividend of $0.67 per share.

Realised carried interest for Q3 was $246 million, down from $555 million in Q2.

At press time, KKR shares were trading at $21.62, up 1.15 percent, giving the group a market capitalisation of $8.98 billion.