In its first quarter under co-CEOs Kewsong Lee and Glenn Youngkin, The Carlyle Group couldn't replicate its lucrative final three months under co-founders David Rubenstein and William Conway.
Amid a slowing stock market weighed down in part by a possible trade war between the US and China, the Washington, DC-based buyout shop's economic net income—a metric designed to gauge both realized and unrealized returns—dipped to 47 cents per share in 1Q, or $169 million. While that's a 53.5% QoQ drop and a 56.9% YoY decline, it also easily outstrips reported Thomson Reuters analyst estimates of 26 cents per share, leading to a intraday stock bump of nearly 2% on Tuesday before shares of Carlyle (NASDAQ:CG) settled back down near their opening price, closing the day at $20.60.
Carlyle posted distributable earnings of $138.9 million in 1Q, more than doubling its total from the same period last year. The firm continued to pile up the management fees, collecting $288 million, up 12% YoY. Another sign of the firm's health: Carlyle's total AUM increased to $201.5 billion, a 24% increase YoY and a jump from $195 billion at the end of 2017.
The firm's corporate private equity AUM reached a record $75 billion in 1Q, a 42% YoY jump, boosted by a portfolio of corporate PE funds that appreciated 4% in the quarter. Carlyle's corporate PE unit suffered a major YoY decline in ENI, however, dropping from $313 million to $114 million.
Straight from its earnings report, here's a closer look at how the firm broke down its corporate PE unit performance:
Carlyle invested $700 million across 15 transactions in 1Q and announced new deals worth a combined $4.6 billion that are expected to close over the coming quarters. That comes as no surprise for a firm that's raised $15.6 billion thus far for its seventh US buyout fund, per an SEC filing from last month, marking the firm's biggest vehicle ever.
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