Blackstone's quarterly earnings slump 39% as asset sales plummet

Gates Industrial

20/07/2023 12:05

By Chibuike Oguh
       NEW YORK, July 20 (Reuters) - Blackstone Inc  BX.N  said
on Thursday its second-quarter distributable earnings slumped
nearly 40%, owing to a sharp drop in asset sales mostly from its
real estate and credit businesses.
    Distributable earnings, which represent cash used to pay
dividends to shareholders, fell to $1.2 billion from nearly $2
billion a year earlier. That resulted in distributable earnings
of 93 cents, in line with average analyst estimate, as per
Refinitiv.
    Blackstone said its net profit from asset sales plunged 82%
to $388.4 million from $2.2 billion in the year-ago period, as
higher interest rates, sticky inflation, and economic
uncertainty have continued to weigh on its
merger-and-acquisition activity.
     A major share of the reduced asset disposals came from
Blackstone's real estate unit, where its net profit sank 94%,
while that of its credit division dropped 46%.
    Still, its private-equity business saw a 20% growth in
performance fees, driven by secondary share sales of
Blackstone's stake in London Stock Exchange Group  LSEG.L  and
Gates Industrial Corporation  GTES.N .
    Corporate private-equity funds appreciated by 9.7%, compared
with an 8.3% growth in the benchmark S&P 500 index  .SPX ,
Blackstone said. Its private credit funds gained 12.7% while
hedge fund assets grew 1.9%. Opportunistic real estate funds
depreciated by 3% in the quarter.
    Under generally accepted accounting principles (GAAP),
Blackstone's net income came in at $601.3 million, versus a net
loss of $29.4 million due to a rebound in revenue from
performance fees and principal investments. 
    Blackstone's total assets under management hit the $1
trillion milestone for the first time, and were in line with its
prior outlook, underpinned by strong fundraising of $30.1
billion in the quarter. It also had about $195 billion of
unspent capital and declared a quarterly dividend of 79 cents
per share.
    
    

 (Reporting by Chibuike Oguh in New York; Editing by Sherry
Jacob-Phillips)
 ((Chibuike.Oguh@thomsonreuters.com; +332-219-1834; Reuters
Messaging: chibuike.oguh.thomsonreuters.com@reuters.net))