Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
8:06 am KKR beats by $0.09, beats on revs (KKR) : Reports Q1 (Mar) earnings of $0.62 per share, excluding non-recurring items, $0.09 better than the Capital IQ Consensus Estimate of $0.53; revenues fell 5.2% year/year to $294.4 mln vs the $262.08 mln consensus.
•"We had a good start to the year with strong returns and cash flow generation, which translated into $599 mln of economic net income and $517 mln of total distributable earnings. Additionally, our balance sheet continues to perform, resulting in a 20% cash return on equity over the twelve months ending March 31st
The "Street" has KKR coming in at .62 for the quarter that should be reported on or about April 23, 2015! All post's welcome! The "Good Dr's In"!
KKR & Co. L.P. Announces Fourth Quarter and Full Year 2014 Results
Realization Activity Drives Strong Full Year Distribution
GAAP net income (loss) attributable to KKR & Co. L.P. was ($0.6) million and $477.6 million for the quarter and year ended December 31, 2014, respectively, down from $277.9 million and $691.2 million in the comparable periods of 2013.
Total distributable earnings was $376.3 million for the quarter ended December 31, 2014, down from $510.4 million in the quarter ended December 31, 2013. Total distributable earnings was $2,028.9 million for the year ended December 31, 2014, up from $1,455.9 million for the year ended December 31, 2013.
Distribution per common unit was $0.35 for the quarter ended December 31, 2014, down from $0.48 in the quarter ended December 31, 2013. Distribution per common unit was $1.90 for the year ended December 31, 2014, up from $1.40 in the year ended December 31, 2013.
Economic net income (“ENI”) was $86.6 million and $1,727.2 million for the quarter and year ended December 31, 2014, respectively, down from $789.6 million and $2,195.6 million in the comparable periods of 2013.
ENI after taxes per adjusted unit(1) was $0.05 and $1.84 for the quarter and year ended December 31, 2014, respectively, down from $1.04 and $2.82 in the comparable periods of 2013.
Fee and yield earnings were $208.4 million and $733.3 million for the quarter and year ended December 31, 2014, respectively, up from $140.1 million and $433.9 million in the comparable periods of 2013.
Book value was $10.1 billion on a total reportable segment basis as of December 31, 2014 or $12.07 per adjusted unit.
Return on equity and cash return on equity were 16% and 21%, respectively.
Assets under management (“AUM”) and fee paying assets under management (“FPAUM”) totaled $98.6 billion and $83.0 billion, respectively, as of December 31, 2014.
The "Street" has KKR coming in at .53 the quarter that should be reported on or about February 10, 2015! All post's welcome! The "Good Dr's In"!
KKR & Co. L.P. Announces Third Quarter 2014 ResultsRealization Activity Drives Strong Year-to-Date Distributable Earnings
KKR & Co. L.P. 4 hours ago
NEW YORK--(BUSINESS WIRE)--
GAAP net income (loss) attributable to KKR & Co. L.P. was $89.9 million for the quarter ended September 30, 2014, down from $204.7 million in the quarter ended September 30, 2013. GAAP net income (loss) attributable to KKR & Co. L.P. was $478.2 million for the nine months ended September 30, 2014, up from $413.3 million in the nine months ended September 30, 2013.
Total distributable earnings was $504.8 million and $1,652.6 million for the quarter and nine months ended September 30, 2014, respectively, up from $251.1 million and $945.5 million in the comparable periods of 2013.
Distribution per common unit was $0.45 and $1.55 for the quarter and nine months ended September 30, 2014, respectively, up from $0.23 and $0.92 in the comparable periods of 2013.
Economic net income (“ENI”) was $508.7 million for the quarter ended September 30, 2014, down from $613.7 million in the quarter ended September 30, 2013. ENI was $1,640.6 million for the nine months ended September 30, 2014, up from $1,405.9 million in the nine months ended September 30, 2013.
ENI after taxes per adjusted unit(1) was $0.50 for the quarter ended September 30, 2014, down from $0.80 in the quarter ended September 30, 2013. ENI after taxes per adjusted unit was $1.81 for the nine months ended September 30, 2014, up from $1.79 in the nine months ended September 30, 2013.
Fee and yield earnings were $207.9 million and $524.9 million for the quarter and nine months ended September 30, 2014, respectively, up from $105.3 million and $293.7 million in the comparable periods of 2013.
Book value was $10.5 billion on a total reportable segment basis as of September 30, 2014 or $12.51 per adjusted unit.
Return on equity and cash return on equity were 24.7% and 23.3%, respectively, on a trailing twelve month basis.
Assets under management (“AUM”) and fee paying assets under management (“FPAUM”) totaled $96.1 billion and $81.4 billion as of September 30, 2014, respectively.
KKR & Co. L.P. ( KKR) today reported its third quarter 2014 results.
For the three, nine and trailing twelve months ended September 30, 2014, the carrying value of our private equity portfolio appreciated 2.2%, 10.5%, and 19.2%, respectively.
KKR declares a distribution of $0.45 per common unit, which includes $0.18 of realized cash carry, the 18th consecutive quarter that realized cash carry has been a component of the distribution.
“Our realization activity in the first nine months of 2014 drove a 68% increase in our year-to-date distribution per unit to $1.55,” said Henry R. Kravis and George R. Roberts, Co-Chairmen and Co-Chief Executive Officers of KKR. “Additionally, our investment portfolio and balance sheet continue to perform, resulting in a 25% return on equity and 23% cash return on equity over the last twelve months.”
___________________________________________________________________________________________________
Note: Certain financial measures, including FRE, ENI, ENI after taxes, fee and yield earnings, book value, cash and short-term investments and adjusted units, are not presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”). See Exhibits B and C for a reconciliation of such measures to financial results prepared in accordance with GAAP.
(1) KKR’s reporting of ENI after taxes now includes a reduction for equity-based charges.
GAAP RESULTS
GAAP results for the quarter and nine months ended September 30, 2014, included net income attributable to KKR & Co. L.P. of $89.9 million and $478.2 million, respectively, and net income attributable to KKR & Co. L.P. per common unit of $0.20 and $1.21, respectively, on a diluted basis. For the quarter and nine months ended September 30, 2013, net income attributable to KKR & Co. L.P. was $204.7 million and $413.3 million, respectively, and net income attributable to KKR & Co. L.P. per common unit was $0.66 and $1.40, respectively, on a diluted basis. The decrease in net income in the quarter ended September 30, 2014 was primarily due to a decrease in investment income, partially offset by an increase in fees and an increase in KKR & Co. L.P.’s ownership percentage in the KKR business. The increase in net income in the nine months ended September 30, 2014 was primarily due to (i) an increase in investment income; (ii) higher fees; and (iii) an increase in KKR & Co. L.P.’s ownership percentage in the KKR business.
SEGMENT RESULTS*
KEY METRICS
(Amounts in millions, except per adjusted unit amounts)
Quarter Ended Nine Months Ended
September 30, 2014 September 30, 2013 % Change September 30, 2014 September 30, 2013 % Change
Total Distributable Earnings
Fees $ 309 $ 275 $ 891 $ 733
Realized Cash Carry 246 82 995 440
Net Realized Investment Income 245 103 720 406
Total Cash Revenues $ 800 $ 459 74 % $ 2,606 $ 1,578 65 %
Total Cash Expenses and Other 295 208 953 633
Total Distributable Earnings
$ 505 $ 251 101 % $ 1,653 $ 946 75 %
Estimated Current Corporate Income Taxes 30 30 82 72
Distributable Earnings, net of taxes $ 475 $ 221 115 % $ 1,571 $ 875 80 %
Distributable Earnings, net of taxes per unit $ 0.59 $ 0.32 84 % $ 2.03 $ 1.27 60 %
Distribution per unit $ 0.45 $ 0.23 96 % $ 1.55 $ 0.92 68 %
Payout ratio 76 % 72 % 76 % 73 %
Economic Net Income
Management, Monitoring and Transaction Fees, Net $ 301 $ 274 $ 854 $ 697
Performance Income 310 353 1,096 861
Investment Income 207 303 648 635
Total Segment Revenues $ 819 $ 930 (12 %) $ 2,598 $ 2,192 19 %
Total Segment Expenses and Other 399 359 1,170 917
Economic Net Income, After-Taxes $ 419 $ 571 (27 %) $ 1,428 $ 1,276 12 %
Economic Net Income, After-Taxes per Adjusted Unit $ 0.50 $ 0.80 (38 %) $ 1.81 $ 1.79 1 %
Fee and Yield Earnings $ 208 $ 105 98 % $ 525 $ 294 79 %
Other
Book Value per Adjusted Unit $ 12.51 $ 10.07 24 %
Last Twelve Months Ended
September 30, 2014 September 30, 2013
Return on Equity 25 % 23 %
Cash Return on Equity
23 % 20 %
________________________________________________________________________________________________
* All segment financial information presented in this release reflects a new presentation as of the second quarter of 2014 following the closing of the acquisition of KFN.
Private Markets
AUM was $59.2 billion as of September 30, 2014, a decrease of $0.2 billion, compared to AUM of $59.4 billion as of June 30, 2014. The decrease was primarily attributable to distributions to the limited partners of our private equity funds arising from realizations which were offset by appreciation in the fair value of our private equity portfolio and new capital raised.
FPAUM was $45.6 billion as of September 30, 2014, a decrease of $0.6 billion, compared to FPAUM of $46.2 billion as of June 30, 2014. The decrease was primarily attributable to distributions to the limited partners of our private equity funds arising from realizations which were partially offset by new capital raised.
Total segment revenues were $631.6 million for the quarter ended September 30, 2014, a decrease of $156.9 million compared to total segment revenues of $788.5 million for the quarter ended September 30, 2013. Total segment revenues were $2,005.1 million for the nine months ended September 30, 2014, an increase of $197.7 million compared to total segment revenues of $1,807.4 million for the nine months ended September 30, 2013. The decrease in revenues in the quarter ended September 30, 2014 was principally attributable to a lower level of both total investment income and carried interest reflecting a lower level of appreciation in our private equity portfolio in the 2014 period. While the value of our private equity portfolio increased in the 2014 period, the amount of appreciation was less than that in the prior period. The increase in revenues in the nine months ended September 30, 2014 was principally attributable to a higher level of carried interest reflecting the initial recognition of carried interest in our North America Fund XI and Asian Fund II in the 2014 period.
ENI was $399.0 million for the quarter ended September 30, 2014, a decrease of $132.8 million compared to ENI of $531.8 million for the quarter ended September 30, 2013. ENI was $1,260.6 million for the nine months ended September 30, 2014, an increase of $84.2 million compared to ENI of $1,176.4 million for the nine months ended September 30, 2013. The decrease in the quarter ended September 30, 2014 was principally attributable to a lower level of total investment income reflecting a lower level of appreciation in our private equity portfolio and a lower level of carried interest. The decrease was partially offset by a lower level of allocations to the carry pool driven by a lower level of carried interest. The increase in the nine months ended September 30, 2014 was principally attributable to a higher level of carried interest reflecting the initial recognition of carried interest in our North America Fund XI and Asian Fund II in the 2014 period, partially offset by higher allocations to the carry pool driven by the higher level of carried interest.
Public Markets
AUM was $37.0 billion as of September 30, 2014, a decrease of $1.5 billion, compared to AUM of $38.5 billion as of June 30, 2014. FPAUM was $35.8 billion as of September 30, 2014, an increase of $2.3 billion, compared to FPAUM of $33.5 billion as of June 30, 2014. For AUM, the decrease was primarily attributable to distributions and redemptions which were partially offset by new capital raised. For FPAUM, the increases were primarily attributable to the inclusion of $2.6 billion of CLOs partially owned by KKR that were not previously included in FPAUM, partially offset by distributions and redemptions in our credit strategies.
Total segment revenues were $93.6 million for the quarter ended September 30, 2014, an increase of $10.1 million compared to total segment revenues of $83.5 million for the quarter ended September 30, 2013. Total segment revenues were $396.4 million for the nine months ended September 30, 2014, an increase of $127.1 million compared to total segment revenues of $269.3 million for the nine months ended September 30, 2013. The increase in the quarter ended September 30, 2014 was principally attributable to a higher level of management fees reflecting new capital raised and acquisitions. The increase in the nine months ended September 30, 2014 was principally attributable to a higher level of management fees reflecting new capital raised and acquisitions as well as higher total investment income primarily relating to the inclusion of KKR Financial Holdings LLC (“KFN”) during the 2014 periods beginning on May 1, 2014.
ENI was $48.1 million for the quarter ended September 30, 2014, an increase of $10.5 million compared to ENI of $37.6 million for the quarter ended September 30, 2013. ENI was $251.5 million for the nine months ended September 30, 2014, an increase of $103.2 million compared to ENI of $148.3 million for the nine months ended September 30, 2013. The increase in the quarter ended September 30, 2014 was principally attributable to a higher level of management fees reflecting new capital raised and acquisitions. The increase in the nine months ended September 30, 2014 was principally attributable to a higher level of management fees reflecting new capital raised and acquisitions as well as higher total investment income primarily relating to the inclusion of KFN during the 2014 periods beginning on May 1, 2014.
Capital Markets and Other
Total segment revenues were $93.4 million for the quarter ended September 30, 2014, an increase of $35.4 million compared to total segment revenues of $58.0 million for the quarter ended September 30, 2013. Total segment revenues were $196.5 million for the nine months ended September 30, 2014, an increase of $80.9 million compared to total segment revenues of $115.6 million for the nine months ended September 30, 2013. The increase in total segment revenues was primarily driven by higher overall capital markets transaction activity.
ENI was $61.6 million for the quarter ended September 30, 2014, an increase of $17.2 million compared to ENI of $44.4 million for the quarter ended September 30, 2013. ENI was $128.5 million for the nine months ended September 30, 2014, an increase of $47.2 million compared to ENI of $81.3 million for the nine months ended September 30, 2013. The increase in both periods was principally attributable to higher transaction fees driven by higher overall capital markets transaction activity, partially offset by higher compensation expense.
CAPITAL AND LIQUIDITY
As of September 30, 2014, KKR had $2.1 billion of cash and short-term investments and $2.5 billion of outstanding debt and preferred share obligations on a total reportable segment basis. This includes KFN’s debt obligations of $657.3 million and KFN’s 7.375% Series A LLC preferred shares of $373.8 million, which are non-recourse to KKR beyond the assets of KFN.As of September 30, 2014,KKR had a $750.0 million revolving credit facility, which does not include a $500.0 million revolving credit facility for use in its capital markets business that was undrawn as of September 30, 2014. On October 22, 2014, KKR refinanced its $750.0 million corporate credit facility with a new credit facility providing for availability of $1.0 billion of borrowings and maturing in October 2019.
As of September 30, 2014, KKR’s portion of total uncalled commitments to its investment funds was $862.1 million. See Exhibit A for details.
DISTRIBUTION
A distribution of $0.45 per common unit has been declared, comprised of (i) $0.10 per common unit from after-tax FRE, (ii) $0.18 per common unit from realized cash carry, (iii) $0.10 per common unit from KKR’s net realized investment income and(iv) $0.07 per common unit from KFN’s net realized investment income. The distribution will be paid on November 18, 2014 to unitholders of record as of the close of business on November 3, 2014.
CONFERENCE CALL
A conference call to discuss KKR's financial results will be held on Thursday, October 23, 2014 at 10:00 a.m. EDT. The conference call may be accessed by dialing (877) 303-2917 (U.S. callers) or +1 (253) 237-1135 (non-U.S. callers); a pass code is not required. Additionally, the conference call will be broadcast live over the Internet and may be accessed through the Investor Center section of KKR's website at http://ir.kkr.com/kkr_ir/kkr_events.cfm. A replay of the live broadcast will be available on KKR's website or by dialing (855) 859-2056 (U.S. callers) or +1 (404) 537-3406 (non-U.S. callers), pass code 13870720, beginning approximately two hours after the broadcast.
From time to time, KKR may use its website as a channel of distribution of material company information. Financial and other important information regarding KKR is routinely posted and accessible on the Investor Center for KKR & Co. L.P. at http://ir.kkr.com/kkr_ir/kkr_events.cfm. In addition, you may automatically receive email alerts and other information about KKR by enrolling your email address at the “Email Alerts” area of the Investor Center on the website.
ABOUT KKR
KKR is a leading global investment firm that manages investments across multiple asset classes including private equity, energy, infrastructure, real estate, credit and hedge funds. KKR aims to generate attractive investment returns by following a patient and disciplined investment approach, employing world-class people, and driving growth and value creation at the asset level. KKR invests its own capital alongside its partners' capital and brings opportunities to others through its capital markets business. References to KKR’s investments may include the activities of its sponsored funds. For additional information about KKR & Co. L.P. ( KKR), please visit KKR's website at www.kkr.com.
FORWARD-LOOKING STATEMENTS
This release contains certain forward-looking statements. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. The forward-looking statements are based on KKR’s beliefs, assumptions and expectations of its future performance, taking into account all information currently available to it. These beliefs, assumptions and expectations can change as a result of many possible events or factors, not all of which are known to KKR or are within its control. If a change occurs, KKR’s business, financial condition, liquidity and results of operations, including but not limited to AUM, FPAUM, FRE, total distributable earnings, ENI, ENI after taxes, fee and yield earnings, fee and yield EBITDA, equity invested and syndicated capital, uncalled commitments, core interest expense, cash and short-term investments, net realized principal investment income and book value, may vary materially from those expressed in the forward-looking statements. The following factors, among others, could cause actual results to vary from the forward-looking statements: the general volatility of the capital markets; failure to realize the benefits of or changes in KKR’s business strategies including the ability to realize the anticipated synergies from acquisitions or strategic partnerships such as Prisma, Nephila, Avoca or KFN; availability, terms and deployment of capital; availability of qualified personnel and expense of recruiting and retaining such personnel; changes in the asset management industry, interest rates or the general economy; underperformance of KKR's investments and decreased ability to raise funds; and the degree and nature of KKR’s competition. KKR does not undertake any obligation to update any forward-looking statements to reflect circumstances or events that occur after the date on which such statements were made except as required by law. In addition, KKR’s business strategy is focused on the long term and financial results are subject to significant volatility. Additional information about factors affecting KKR is available in KKR & Co. L.P.’s Annual Report on Form 10-K for the fiscal year ended December 31, 2013, filed with the SEC on February 24, 2014, quarterly reports on Form 10-Q for subsequent quarters and other filings with the SEC, which are available at www.sec.gov.
KKR
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (GAAP BASIS - UNAUDITED)
(Amounts in thousands, except common unit and per common unit amounts)
Quarter Ended Nine Months Ended
September 30, 2014 September 30, 2013 September 30, 2014 September 30, 2013
Revenues
Fees $ 344,768 $ 220,028 $ 897,064 $ 537,644
Expenses
Compensation and Benefits 320,423 329,182 1,010,191 860,905
Occupancy and Related Charges 15,501 17,637 46,968 46,036
General, Administrative and Other 168,486 108,676 505,747 279,906
Total Expenses 504,410 455,495 1,562,906 1,186,847
Investment Income (Loss)
Net Gains (Losses) from Investment Activities 298,259 2,230,401 4,242,289 4,598,755
Dividend Income 599,020 121,059 968,626 370,014
Interest Income 260,292 114,861 638,124 352,250
Interest Expense (96,618 ) (25,056 ) (197,346 ) (72,693 )
Total Investment Income (Loss) 1,060,953 2,441,265 5,651,693 5,248,326
Income (Loss) Before Taxes 901,311 2,205,798 4,985,851 4,599,123
Income Taxes 29,267 7,644 57,145 25,525
Net Income (Loss) 872,044 2,198,154 4,928,706 4,573,598
Net Income (Loss) Attributable to
Redeemable Noncontrolling Interests (2,462 ) 9,169 1,366 25,992
Net Income (Loss) Attributable to
Noncontrolling Interests 784,568 1,984,245 4,449,146 4,134,293
Net Income (Loss) Attributable to KKR & Co. L.P. $ 89,938 $ 204,740 $ 478,194 $ 413,313
Net Income (Loss) Attributable to KKR & Co. L.P. Per Common Unit
Basic $ 0.21 $ 0.73 $ 1.31 $ 1.53
Diluted (a) $ 0.20 $ 0.66 $ 1.21 $ 1.40
Weighted Average Common Units Outstanding
Basic 419,961,455 282,148,802 364,127,956 270,484,224
Diluted (a) 452,019,742 308,135,191 396,232,828 296,181,070
__________________________________________________________________________________
(a) KKR Holdings L.P. units have been excluded from the calculation of diluted earnings per common unit since the exchange of these units would not dilute KKR’s respective ownership interests in the KKR Group Partnerships.
KKR
STATEMENTS OF OPERATIONS AND OTHER SELECTED FINANCIAL INFORMATION
TOTAL REPORTABLE SEGMENTS (UNAUDITED)
(Amounts in thousands, except unit and per unit amounts)
Quarter Ended Nine Months Ended
September 30, 2014 June 30, 2014 September 30, 2013 September 30, 2014 September 30, 2013
Segment Revenues
Management, Monitoring and Transaction Fees, Net
Management Fees $ 173,912 $ 178,674 $ 173,245 $ 547,979 $ 490,384
Monitoring Fees 30,449 29,610 33,010 96,422 93,985
Transaction Fees 158,564 84,305 129,127 406,385 232,211
Fee Credits (61,811 ) (49,830 ) (61,782 ) (196,309 ) (119,598 )
Total Management, Monitoring and Transaction Fees, Net 301,114 242,759 273,600 854,477 696,982
Performance Income
Realized Carried Interest 246,026 555,488 81,532 995,064 439,527
Incentive Fees 8,009 11,478 1,225 36,506 35,664
Unrealized Carried Interest 56,192 (137,826 ) 270,237 64,013 385,466
Total Performance Income 310,227 429,140 352,994 1,095,583 860,657
Investment Income (Loss)
Net Realized Gains (Losses) 162,795 221,661 103,545 566,184 404,751
Net Unrealized Gains (Losses) (37,833 ) (119,935 ) 200,706 (72,009 ) 228,437
Total Realized and Unrealized 124,962 101,726 304,251 494,175 633,188
Net Interest and Dividends 82,254 60,432 (779 ) 153,850 1,532
Total Investment Income (Loss) 207,216 162,158 303,472 648,025 634,720
Total Segment Revenues 818,557 834,057 930,066 2,598,085 2,192,359
Segment Expenses
Compensation and Benefits
Cash Compensation and Benefits 108,790 91,444 92,229 309,149 247,827
Realized Allocation to Carry Pool 98,411 222,195 32,613 398,026 175,811
Unrealized Allocation to Carry Pool 22,696 (53,435 ) 112,899 27,951 165,741
Total Compensation and Benefits 229,897 260,204 237,741 735,126 589,379
Occupancy and Related Charges 14,458 14,757 15,674 43,404 42,063
Other Operating Expenses 60,272 54,311 60,884 167,384 150,541
Total Segment Expenses 304,627 329,272 314,299 945,914 781,983
Income (Loss) attributable to noncontrolling interests 5,189 3,206 2,020 11,597 4,444
Economic Net Income (Loss) (a) $ 508,741 $ 501,579 $ 613,747 $ 1,640,574 $ 1,405,932
Provision for Income Taxes 47,361 6,330 11,950 90,272 45,553
Equity-based Charges 42,090 40,877 31,227 122,320 84,581
Economic Net Income (Loss), After Taxes (b) $ 419,290 $ 454,372 $ 570,570 $ 1,427,982 $ 1,275,798
Economic Net Income (Loss), After Taxes Per Adjusted Unit $ 0.50 $ 0.57 $ 0.80 $ 1.81 $ 1.79
Weighted Average Adjusted Units (Fully Diluted Basis) (a) 835,957,683 800,747,528 715,781,663 787,502,790 714,171,641
Assets Under Management $ 96,149,900 $ 97,957,900 $ 90,169,200 $ 96,149,900 $ 90,169,200
Fee Paying Assets Under Management $ 81,356,700 $ 79,656,300 $ 73,611,900 $ 81,356,700 $ 73,611,900
Equity Invested and Syndicated Capital $ 4,751,400 $ 2,345,500 $ 2,848,700 $ 10,474,200 $ 5,562,500
Uncalled Commitments $ 17,555,400 $ 19,784,200 $ 22,718,400 $ 17,555,400 $ 22,718,400
Other Information
Fee Related Earnings $ 125,603 $ 93,725 $ 106,038 $ 371,046 $ 292,215
Plus: Net Interest and Dividends 82,254 60,432 (779 ) 153,850 1,532
Fee and Yield Earnings (a) $ 207,857 $ 154,157 $ 105,259 $ 524,896 $ 293,747
Plus: Depreciation and Amortization 3,777 4,140 3,601 11,952 10,990
Plus: Core Interest Expense 23,347 19,205 16,215 60,952 48,658
Fee and Yield EBITDA (a) $ 234,981 $ 177,502 $ 125,075 $ 597,800 $ 353,395
Total Distributable Earnings (a) $ 504,817 $ 700,973 $ 251,137 $ 1,652,598 $ 945,527
GAAP interest expense $ 96,618 $ 65,997 $ 25,056 $ 197,346 $ 72,693
Less: interest expense related to debt obligations
from investment financing arrangements and KFN 73,271 46,792 8,841 136,394 24,035
Core Interest Expense (a) $ 23,347 $ 19,205 $ 16,215 $ 60,952 $ 48,658
_____________________________________________________________________________________________
(a) See definitions for economic net income (loss), adjusted units, fee and yield earnings, fee and yield EBITDA, total distributable earnings and core interest expense under “Notes to Reportable Segments.”
(b) Represents economic net income (loss) after reductions for income taxes and equity-based charges.
KKR
STATEMENTS OF OPERATIONS AND OTHER SELECTED FINACIAL INFORMATION
PRIVATE MARKETS SEGMENT (UNAUDITED)
(Amounts in thousands)
Quarter Ended Nine Months Ended
September 30, 2014 June 30, 2014 September 30, 2013 September 30, 2014 September 30, 2013
Segment Revenues
Management, Monitoring and Transaction Fees, Net
Management Fees $ 107,443 $ 111,542 $ 119,410 $ 342,024 $ 340,715
Monitoring Fees 30,449 29,610 33,010 96,422 93,985
Transaction Fees 67,772 45,340 54,968 206,132 96,611
Fee Credits (58,810 ) (43,478 ) (46,597 ) (182,626 ) (97,153 )
Total Management, Monitoring and Transaction Fees, Net 146,854 143,014 160,791 461,952 434,158
Performance Income
Realized Carried Interest 236,126 555,488 81,532 960,414 439,527
Incentive Fees - - - - -
Unrealized Carried Interest 53,776 (163,564 ) 256,215 35,988 340,254
Total Performance Income 289,902 391,924 337,747 996,402 779,781
Investment Income (Loss)
Net Realized Gains (Losses) 165,047 207,892 104,061 549,137 401,750
Net Unrealized Gains (Losses) 8,293 (122,729 ) 194,270 (43,763 ) 210,154
Total Realized and Unrealized 173,340 85,163 298,331 505,374 611,904
Net Interest and Dividends 21,463 22,760 (8,344 ) 41,415 (18,410 )
Total Investment Income (Loss) 194,803 107,923 289,987 546,789 593,494
Total Segment Revenues 631,559 642,861 788,525 2,005,143 1,807,433
Segment Expenses
Compensation and Benefits
Cash Compensation and Benefits 59,991 56,522 65,400 183,411 164,917
Realized Allocation to Carry Pool 94,451 222,195 32,613 384,166 175,811
Unrealized Allocation to Carry Pool 21,729 (63,730 ) 107,290 16,742 147,656
Total Compensation and Benefits 176,171 214,987 205,303 584,319 488,384
Occupancy and Related Charges 11,460 11,764 13,367 34,784 35,935
Other Operating Expenses 44,619 39,589 37,586 124,267 105,516
Total Segment Expenses 232,250 266,340 256,256 743,370 629,835
Income (Loss) attributable to noncontrolling interests 342 335 433 1,192 1,242
Economic Net Income (Loss) $ 398,967 $ 376,186 $ 531,836 $ 1,260,581 $ 1,176,356
Assets Under Management $ 59,168,300 $ 59,417,000 $ 59,678,300 $ 59,168,300 $ 59,678,300
Fee Paying Assets Under Management $ 45,591,600 $ 46,167,300 $ 49,889,500 $ 45,591,600 $ 49,889,500
Equity Invested $ 2,389,200 $ 1,454,400 $ 1,805,800 $ 6,395,400 $ 3,718,300
Uncalled Commitments $ 14,907,300 $ 17,109,800 $ 21,103,800 $ 14,907,300 $ 21,103,800
KKR
STATEMENTS OF OPERATIONS AND OTHER SELECTED FINACIAL INFORMATION
PUBLIC MARKETS SEGMENT (UNAUDITED)
(Amounts in thousands)
Quarter Ended Nine Months Ended
September 30, 2014 June 30, 2014 September 30, 2013 September 30, 2014 September 30, 2013
Segment Revenues
Management, Monitoring and Transaction Fees, Net
Management Fees $ 66,469 $ 67,132 $ 53,835 $ 205,955 $ 149,669
Monitoring Fees - - - - -
Transaction Fees 3,262 7,350 20,534 16,634 30,883
Fee Credits (3,001 ) (6,352 ) (15,185 ) (13,683 ) (22,445 )
Total Management, Monitoring and Transaction Fees, Net 66,730 68,130 59,184 208,906 158,107
Performance Income
Realized Carried Interest 9,900 - - 34,650 -
Incentive Fees 8,009 11,478 1,225 36,506 35,664
Unrealized Carried Interest 2,416 25,738 14,022 28,025 45,212
Total Performance Income 20,325 37,216 15,247 99,181 80,876
Investment Income (Loss)
Net Realized Gains (Losses) (630 ) 14,284 979 19,133 6,128
Net Unrealized Gains (Losses) (46,118 ) 3,751 4,653 (27,553 ) 13,981
Total Realized and Unrealized (46,748 ) 18,035 5,632 (8,420 ) 20,109
Net Interest and Dividends 53,335 33,822 3,481 96,734 10,229
Total Investment Income (Loss) 6,587 51,857 9,113 88,314 30,338
Total Segment Revenues 93,642 157,203 83,544 396,401 269,321
Segment Expenses
Compensation and Benefits
Cash Compensation and Benefits 26,787 26,904 18,606 80,436 60,296
Realized Allocation to Carry Pool 3,960 - - 13,860 -
Unrealized Allocation to Carry Pool 967 10,295 5,609 11,209 18,085
Total Compensation and Benefits 31,714 37,199 24,215 105,505 78,381
Occupancy and Related Charges 2,518 2,544 1,906 7,234 5,063
Other Operating Expenses 10,929 11,474 19,670 30,910 36,643
Total Segment Expenses 45,161 51,217 45,791 143,649 120,087
Income (Loss) attributable to noncontrolling interests 335 385 202 1,242 935
Economic Net Income (Loss) $ 48,146 $ 105,601 $ 37,551 $ 251,510 $ 148,299
Assets Under Management $ 36,981,600 $ 38,540,900 $ 30,490,900 $ 36,981,600 $ 30,490,900
Fee Paying Assets Under Management $ 35,765,100 $ 33,489,000 $ 23,722,400 $ 35,765,100 $ 23,722,400
Equity Invested $ 442,200 $ 724,400 $ 326,400 $ 1,900,700 $ 862,100
Uncalled Commitments $ 2,648,100 $ 2,674,400 $ 1,614,600 $ 2,648,100 $ 1,614,600
Gross Dollars Invested $ 1,122,100 $ 768,200 $ 1,506,900 $ 2,880,000 $ 2,732,200
...
KKR
STATEMENTS OF OPERATIONS AND OTHER SELECTED FINACIAL INFORMATION
CAPITAL MARKETS AND OTHER SEGMENT (UNAUDITED)
(Amounts in thousands)
Quarter Ended Nine Months Ended
September 30, 2014
June 30, 2014 September 30, 2013 September 30, 2014 September 30, 2013
Segment Revenues
Management, Monitoring and Transaction Fees, Net
Management Fees $ - $ - $ - $ - $ -
Monitoring Fees - - - - -
Transaction Fees 87,530 31,615 53,625 183,619 104,717
Fee Credits - - - - -
Total Management, Monitoring and Transaction Fees, Net 87,530 31,615 53,625 183,619 104,717
Performance Income
Realized Carried Interest - - - - -
Incentive Fees - - - - -
Unrealized Carried Interest - - - - -
Total Performance Income - - - - -
Investment Income (Loss)
Net Realized Gains (Losses) (1,622 ) (515 ) (1,495 ) (2,086 ) (3,127 )
Net Unrealized Gains (Losses) (8 ) (957 ) 1,783 (693 ) 4,302
Total Realized and Unrealized (1,630 ) (1,472 ) 288 (2,779 ) 1,175
Net Interest and Dividends 7,456 3,850 4,084 15,701 9,713
Total Investment Income (Loss) 5,826 2,378 4,372 12,922 10,888
Total Segment Revenues 93,356 33,993 57,997 196,541 115,605
Segment Expenses
Compensation and Benefits
Cash Compensation and Benefits 22,012 8,018 8,223 45,302 22,614
Realized Allocation to Carry Pool - - - - -
Unrealized Allocation to Carry Pool - - - - -
Total Compensation and Benefits 22,012 8,018 8,223 45,302 22,614
Occupancy and Related Charges 480 449 401 1,386 1,065
Other Operating Expenses 4,724 3,248 3,628 12,207 8,382
Total Segment Expenses 27,216 11,715 12,252 58,895 32,061
Income (Loss) attributable to noncontrolling interests 4,512 2,486 1,385 9,163 2,267
Economic Net Income (Loss) $ 61,628 $ 19,792 $ 44,360 $ 128,483 $ 81,277
Syndicated Capital $ 1,920,000 $ 166,700 $ 716,500 $ 2,178,100 $ 982,100
KKR
BALANCE SHEET
TOTAL REPORTABLE SEGMENTS (UNAUDITED)
(Amounts in thousands, except per unit amounts)
As of
September 30, 2014
As of
December 31, 2013
Cash and short-term investments $ 2,140,056 $ 2,161,097
Investments 9,221,448 (a) 4,980,265
Unrealized carry 1,248,605 (b) 1,179,338 (b)
Other assets 905,746 662,357
Total assets $ 13,515,855 $ 8,983,057
Debt obligations - KKR $ 1,500,000 $ 1,000,000
Debt obligations - KFN 657,310 -
Preferred shares - KFN 373,750 -
Other liabilities 382,925 149,196
Total liabilities
2,913,985 1,149,196
Noncontrolling interests 123,617 71,261
Book value $ 10,478,253 $ 7,762,600
Book value per adjusted unit $ 12.51 $ 10.83
(a) See schedule of investments that follows on the next page.
(b) Unrealized Carry As of September 30, 2014
As of December 31, 2013
Private Markets $ 1,169,447 $ 1,116,996
Public Markets 79,158 62,342
Total
$ 1,248,605 $ 1,179,338
KKR
SCHEDULE OF INVESTMENTS
TOTAL REPORTABLE SEGMENTS (UNAUDITED)
(Amounts in thousands, except percentage amounts)
As of September 30, 2014
Investments Cost Fair Value
Fair Value as a
Percentage of
Total Investments
Private Equity Co-Investments $ 2,302,767 $ 2,703,230 29.3 %
Private Equity Funds 903,401 1,098,504 11.9 %
Private Equity Total 3,206,168 3,801,734 41.2 %
Energy 814,165 926,853 10.1 %
Real Estate 288,385 313,400 3.4 %
Infrastructure 51,436 56,012 0.6 %
Real Assets Total 1,153,986 1,296,265 14.1 %
Private Markets Total 4,360,154 5,097,999 55.3 %
Alternative Credit 898,790 967,903 10.6 %
CLOs 1,544,225 1,506,631 16.3 %
Liquid Credit 278,468 305,129 3.3 %
Credit Total 2,721,483 2,779,663 30.2 %
Other 56,700 57,100 0.6 %
Public Markets Total 2,778,183 2,836,763 30.8 %
Specialty Finance 229,293 234,419 2.5 %
Other 1,008,673 1,052,267 11.4 %
Capital Markets and Other Total 1,237,966 1,286,686 13.9 %
Total Investments $ 8,376,303 $ 9,221,448 100.0 %
Significant Aggregate Portfolio Company Investments:(a)
First Data Corporation $ 1,061,332 $ 998,749 10.8 %
Alliance Boots GmbH 221,684 690,564 7.5 %
Biomet, Inc. 164,644 213,142 2.3 %
HCA Inc. 29,455 176,526 1.9 %
Kion Group GmbH 103,033 137,560 1.5 %
1,580,148 2,216,541 24.0 %
Other Investments 6,796,155 7,004,907 76.0 %
Total Investments $ 8,376,303 $ 9,221,448 100 %
____________________________________________________________________________________________
(a) The significant aggregate portfolio company investments include the top five private equity investments in portfolio companies (other than investments expected to be syndicated or transferred to a fund) based on their fair market value as of September 30, 2014. The fair value figures include the co-investment and the limited partner and/or general partner interests in the underlying portfolio company.
KKR
ASSETS UNDER MANAGEMENT* (UNAUDITED)
(Amounts in thousands)
Private
Markets
Segment
Public Markets
Segment
Total
Reportable
Segments
Quarter Ended September 30, 2014
June 30, 2014 $ 59,417,000 $ 38,540,900 $ 97,957,900
New Capital Raised 745,900 1,955,200 2,701,100
Distributions (1,989,400 ) (2,901,000 ) (d) (4,890,400 )
Change in Value 994,800 (613,500 ) 381,300
September 30, 2014 $ 59,168,300 $ 36,981,600 $ 96,149,900
Nine Months Ended September 30, 2014
December 31, 2013 $ 61,242,900 $ 33,077,400 $ 94,320,300
New Capital Raised 2,449,000 5,022,000 7,471,000
Acquisitions (a) - 8,423,000 8,423,000
KFN Acquisition (b) - (4,511,900 ) (4,511,900 )
Distributions (8,624,200 ) (5,288,600 ) (e) (13,912,800 )
Net Changes in Fee Base of Certain Funds (c) (933,800 ) - (933,800 )
Change in Value 5,034,400 259,700 5,294,100
September 30, 2014 $ 59,168,300 $ 36,981,600 $ 96,149,900
Trailing Twelve Months Ended September 30, 2014
September 30, 2013 $ 59,678,300 $ 30,490,900 $ 90,169,200
New Capital Raised 3,743,100 7,545,800 11,288,900
Acquisitions (a) - 8,423,000 8,423,000
KFN Acquisition (b) - (4,511,900 ) (4,511,900 )
Distributions (11,713,100 ) (6,023,700 ) (f) (17,736,800 )
Net Changes in Fee Base of Certain Funds (c) (933,800 ) - (933,800 )
Change in Value 8,393,800 1,057,500 9,451,300
September 30, 2014 $ 59,168,300 $ 36,981,600 $ 96,149,900
______________________________________________________________________________________________
* Excludes those assets managed by entities where KKR does not hold more than a 50% ownership interest.
(a) Represents the AUM of Avoca.
(b) Certain assets that were externally managed prior to the acquisition of KFN are now reported on the balance sheet and excluded from AUM.
(c) Represents the impact of certain funds entering the post-investment period.
(d) Includes $879.4 million of redemptions by fund investors.
(e) Includes $2,167.8 million of redemptions by fund investors.
(f) Includes $2,495.1 million of redemptions by fund investors.
KKR
FEE PAYING ASSETS UNDER MANAGEMENT* (UNAUDITED)
(Amounts in thousands)
Private
Markets
Segment
Public Markets
Segment
Total
Reportable
Segments
Quarter Ended September 30, 2014
June 30, 2014 $ 46,167,300 $ 33,489,000 $ 79,656,300
New Capital Raised 662,300 4,097,800 (d) 4,760,100
Distributions (1,021,200 ) (1,055,900 ) (e) (2,077,100 )
Change in Value (216,800 ) (765,800 ) (982,600 )
September 30, 2014 $ 45,591,600 $ 35,765,100 $ 81,356,700
Nine Months Ended September 30, 2014
December 31, 2013 $ 50,156,300 $ 27,241,200 $ 77,397,500
New Capital Raised 2,019,300 6,857,100 8,876,400
Acquisitions (a) - 7,971,000 7,971,000
KFN Acquisition (b) - (2,684,700 ) (2,684,700 )
Distributions (5,388,100 ) (3,386,000 ) (f) (8,774,100 )
Net Changes in Fee Base of Certain Funds (c) (964,700 ) - (964,700 )
Change in Value (231,200 ) (233,500 ) (464,700 )
September 30, 2014 $ 45,591,600 $ 35,765,100 $ 81,356,700
Trailing Twelve Months Ended September 30, 2014
September 30, 2013 $ 49,889,500 $ 23,722,400 $ 73,611,900
New Capital Raised 3,489,100 10,330,800 13,819,900
Acquisitions (a) - 7,971,000 7,971,000
KFN Acquisition (b) - (2,684,700 ) (2,684,700 )
Distributions (6,715,100 ) (3,977,100 ) (g) (10,692,200 )
Net Changes in Fee Base of Certain Funds (c) (964,700 ) - (964,700 )
Change in Value (107,200 ) 402,700 295,500
September 30, 2014 $ 45,591,600 $ 35,765,100 $ 81,356,700
______________________________________________________________________________________________
* Excludes those assets managed by entities where KKR does not hold more than a 50% ownership interest.
(a) Represents the FPAUM of Avoca.
(b) Certain assets that were externally managed prior to the acquisition of KFN are now reported on the balance sheet and excluded from FPAUM.
(c) Represents the impact of certain funds entering the post-investment period.
(d) Includes $2.6 billion of CLOs partially owned by KKR that were not previously included in FPAUM and was not new capital raised during the quarter.
(e) Includes $879.4 million of redemptions by fund investors.
(f) Includes $2,167.8 million of redemptions by fund investors.
(g) Includes $2,495.1 million of redemptions by fund investors.
KKR
INVESTMENT VEHICLE SUMMARY (a)(UNAUDITED)
As of September 30, 2014
(Amounts in millions, except percentages)
Investment Period Amount
Commencement Date
End Date Commitment Uncalled Commitments Percentage Committed by General Partner Invested Realized Remaining Cost Remaining Fair Value
Private Markets
Private Equity Funds
Asian Fund II 4/2013 4/2019 $ 5,825.0 $ 4,050.0 1.3 % $ 1,775.0 $ - $ 1,775.0 $ 2,104.7
North America Fund XI 9/2012 9/2018 8,718.4 4,494.2 2.9 % 4,224.2 185.5 4,224.2 5,036.2
China Growth Fund 11/2010 11/2016 1,010.0 507.5 1.0 % 502.5 42.4 485.0 549.0
E2 Investors (Annex Fund) 8/2009 11/2013 209.0 13.2 4.5 % 195.8 144.4 54.5 279.2
European Fund III 3/2008 3/2014 6,204.8 624.3 4.6 % 5,580.5 2,232.9 4,464.4 6,450.4
Asian Fund 7/2007 4/2013 3,983.3 139.8 2.5 % 3,843.5 4,054.6 2,471.0 3,636.5
2006 Fund 9/2006 9/2012 17,642.2 553.1 2.1 % 17,089.1 13,634.2 9,839.0 15,204.7
European Fund II 11/2005 10/2008 5,750.8 - 2.1 % 5,750.8 5,475.2 1,554.2 2,652.8
Millennium Fund 12/2002 12/2008 6,000.0 - 2.5 % 6,000.0 11,332.0 1,318.7 2,263.6
European Fund 12/1999 12/2005 3,085.4 - 3.2 % 3,085.4 8,736.6 - 40.8
Total Private Equity Funds 58,428.9 10,382.1 48,046.8 45,837.8 26,186.0 38,217.9
Co-Investment Vehicles Various Various 3,287.4 699.1 Various 2,588.3 1,031.4 2,266.9 2,900.6
Total Private Equity
61,716.3 11,081.2 50,635.1 46,869.2 28,452.9 41,118.5
Real Assets
Energy Income and Growth Fund
9/2013 9/2018 1,974.2 1,614.1 12.8 % 360.1 32.4 336.6 359.0
Natural Resources Fund Various Various 891.6 198.5 Various 693.1 95.1 619.9 433.1
Global Energy Opportunities Various Various 1,028.8 905.0 Various 123.8 27.7 118.8 75.5
Infrastructure Fund Various Various 1,041.1 272.9 4.8 % 768.2 69.6 768.2 814.0
Infrastructure Co-Investments Various Various 1,104.5 - Various 1,104.5 279.0 1,104.5 1,377.7
Real Estate Partners Americas 5/2013 12/2016 1,289.1 835.6 15.5 % 453.5 180.1 393.2 443.1
Real Assets 7,329.3 3,826.1 3,503.2 683.9 3,341.2 3,502.4
Private Markets Total 69,045.6 14,907.3 54,138.3 47,553.1 31,794.1 44,620.9
Public Markets
Special Situations Vehicles Various Various 4,725.1 1,609.1 Various 3,116.0 1,043.8 2,540.6 2,991.4
Mezzanine Fund 3/2010 8/2015 987.0 268.6 4.6 % 718.4 235.3 599.5 726.8
Direct Lending Vehicles Various Various 1,345.7 770.4 Various 575.3 63.3 575.3 625.3
Public Markets Total 7,057.8 2,648.1 4,409.7 1,342.4 3,715.4 4,343.5
Grand Total $ 76,103.4 $ 17,555.4 $ 58,548.0 $ 48,895.5 $ 35,509.5 $ 48,964.4
_____________________________________________________________________________________________
(a) Reflects investment vehicles for which KKR has the ability to earn carried interest.
KKR
DISTRIBUTION CALCULATION (UNAUDITED)
(Amounts in thousands, except unit and per unit amounts)
Quarter Ended Nine Months Ended
September 30, 2014 June 30, 2014 September 30, 2013 September 30, 2014 September 30, 2013
Cash Revenues
Fees $ 309,123 $ 254,237 $ 274,825 $ 890,983 $ 732,646
Realized cash carry 246,026 555,488 81,532 995,064 439,527
Net realized investment income - KKR (ex-KFN) 192,146 245,711 102,766 630,749 406,283
Net realized investment income - KFN 52,903 36,382 - 89,285 -
Total Cash Revenues 800,198 1,091,818 459,123 2,606,081 1,578,456
Cash Expenses
Cash compensation and benefits 108,790 91,444 92,229 309,149 247,827
Realized cash carry allocated to carry pool 98,411 222,195 32,613 398,026 175,811
Occupancy and related charges 14,458 14,757 15,674 43,404 42,063
Other operating expenses 60,272 54,311 60,884 167,384 150,541
Total Cash Expenses 281,931 382,707 201,400 917,963 616,242
Cash income (loss) before noncontrolling interests and local taxes 518,267 709,111 257,723 1,688,118 962,214
Less: local income taxes (8,261 ) (4,932 ) (4,566 ) (23,923 ) (12,243 )
Less: noncontrolling interests (5,189 ) (3,206 ) (2,020 ) (11,597 ) (4,444 )
Total Distributable Earnings 504,817 700,973 251,137 1,652,598 945,527
Less: estimated current corporate income taxes (29,505 ) (19,025 ) (30,140 ) (81,975 ) (72,005 )
Distributable Earnings, net of taxes 475,312 681,948 220,997 1,570,623 873,522
Less: Undistributed net realized investment income - KKR (ex-KFN) (115,288 ) (147,427 ) (61,660 ) (378,450 ) (243,770 )
Distributed Earnings $ 360,024 $ 534,521 $ 159,337 $ 1,192,173 $ 629,752
Distributable Earnings, net of taxes per KKR & Co. L.P. common unit $ 0.59 $ 0.85 $ 0.32 $ 2.03 $ 1.27
Distribution per KKR & Co. L.P. common unit $ 0.45 $ 0.67 $ 0.23 $ 1.55 $ 0.92
Components of Distribution per KKR & Co. L.P. Common unit
After-tax FRE $ 0.10 $ 0.09 $ 0.10 $ 0.34 $ 0.30
Realized Cash Carry $ 0.18 $ 0.41 $ 0.07 $ 0.76 $ 0.38
Distributed Net Realized Investment Income - KKR (ex-KFN) $ 0.10 $ 0.12 $ 0.06 $ 0.33 $ 0.24
Distributed Net Realized Investment Income - KFN $ 0.07 $ 0.05 $ - $ 0.12 $ -
Fee and yield earnings distribution per KKR & Co. L.P. common unit $ 0.18 $ 0.15 $ 0.10 $ 0.49 $ 0.30
Adjusted Units Eligible For Distribution 808,698,012 803,719,050 689,795,274
Payout Ratio 75.7 % 78.4 % 72.1 % 75.9 % 72.1 %
DISTRIBUTION POLICY
KKR intends to make quarterly cash distributions in amounts that in the aggregate are expected to constitute substantially all of the cash earnings of the KKR’s investment management business, 40% of the net realized investment income of KKR (other than KFN), and 100% of the net realized investment income of KFN, in each case in excess of amounts determined by KKR to be necessary or appropriate to provide for the conduct of its business, to make appropriate investments in its business and its investment funds and to comply with applicable law and any of its debt instruments or other obligations. For purposes of KKR’s distribution policy, its distributions are expected to consist of (i) FRE, (ii) carry distributions received from KKR’s investment funds which have not been allocated as part of its carry pool, (iii) 40% of the net realized investment income from KKR (other than KFN) and (iv) 100% of the net realized investment income from KFN. This amount is expected to be reduced by (i) corporate and applicable local taxes, if any, (ii) non-controlling interests, and (iii) amounts determined by KKR to be necessary or appropriate for the conduct of its business and other matters as discussed above.
The declaration and payment of any distributions are subject to the discretion of the board of directors of the general partner of KKR & Co. L.P., which may change the distribution policy at any time, and the terms of its limited partnership agreement. There can be no assurance that distributions will be made as intended or at all or that unitholders will receive sufficient distributions to satisfy payment of their tax liabilities as limited partners of KKR & Co. L.P. When KKR & Co. L.P. receives distributions from the KKR Group Partnerships (the holding companies of the KKR business), KKR Holdings receives its pro rata share of such distributions from the KKR Group Partnerships.
KKR
Notes to Reportable Segments (Unaudited)
The segment key performance measures that follow are used by management in making operating and resource deployment decisions as well as assessing the overall performance of each of KKR’s reportable business segments. The reportable segments for KKR’s business are presented prior to giving effect to the allocation of income (loss) between KKR & Co. L.P. and KKR Holdings L.P. and as such represent the business in total. In addition, KKR’s reportable segments are presented without giving effect to the consolidation of the funds that KKR manages.
KKR discloses the following financial measures in this earnings release that are calculated and presented using methodologies other than in accordance with GAAP. We believe that providing these performance measures on a supplemental basis to our GAAP results is helpful to unitholders in assessing the overall performance of KKR’s businesses. These financial measures should not be considered as a substitute for similar financial measures calculated in accordance with GAAP. We caution readers that these non-GAAP financial measures may differ from the calculations of other investment managers, and as a result, may not be comparable to similar measures presented by other investment managers. Reconciliations of these non-GAAP financial measures to the most directly comparable financial measures calculated and presented in accordance with GAAP are included elsewhere within this earnings release.
Fee related earnings (“FRE”) is comprised of (i) total management, monitoring and transaction fees, net, plus incentive fees, less (ii) cash compensation and benefits, occupancy and related charges and other operating expenses. This measure is used by management as an alternative measurement of the operating earnings of KKR and its business segments before carried interest and related carry pool allocations and investment income. We believe this measure is useful to unitholders as it provides additional insight into the operating profitability of our fee generating management companies and capital markets businesses. The components of FRE on a segment basis differ from the equivalent GAAP amounts on a consolidated basis as a result of: (i) the inclusion of management fees earned from consolidated funds that were eliminated in consolidation; (ii) the exclusion of fees and expenses of certain consolidated entities; (iii) the exclusion of charges relating to the amortization of intangible assets; (iv) the exclusion of charges relating to carry pool allocations; (v) the exclusion of non-cash equity-based charges and other non-cash compensation charges borne by KKR Holdings or incurred under the KKR & Co. L.P. 2010 Equity Incentive Plan (“Equity Incentive Plan”); (vi) the exclusion of certain reimbursable expenses; and (vii) the exclusion of certain non-recurring items.
Economic net income (loss) (“ENI”)is a measure of profitability for KKR’s reportable segments and is used by management as an alternative measurement of the operating and investment earnings of KKR and its business segments. We believe this measure is useful to unitholders as it provides additional insight into the overall profitability of KKR’s businesses inclusive of carried interest and related carry pool allocations and investment income. ENI is comprised of total segment revenues less total segment expenses and certain economic interests in KKR’s segments held by third parties. ENI differs from net income (loss) on a GAAP basis as a result of: (i) the inclusion of management fees earned from consolidated funds that were eliminated in consolidation; (ii) the exclusion of fees and expenses of certain consolidated entities; (iii) the exclusion of charges relating to the amortization of intangible assets; (iv) the exclusion of non-cash equity-based charges and other non-cash compensation charges borne by KKR Holdings or incurred under the Equity Incentive Plan or other securities that are exchangeable for common units of KKR & Co. L.P.; (v) the exclusion of certain non-recurring items; (vi) the exclusion of investment income (loss) relating to noncontrolling interests; and (vii) the exclusion of income taxes.
Fee and Yield Earningsis comprised of FRE and net interest and dividends from KKR’s business segments. This measure is used by management as a measure of the cash earnings of KKR and its business segments’ investment income. We believe this measure is useful to unitholders as it provides insight into the amount of KKR’s cash earnings, significant portions of which tend to be more recurring than realized carried interest and net realized gains from quarter to quarter.
Fee and Yield EBITDAis comprised of Fee and Yield Earnings before the impact of depreciation of fixed assets and core interest expense. This is used by management as another measure of the cash earnings of KKR and its business segments investment income. We believe this measure is also useful to unitholders as it provides insight into the amount of KKR’s cash earnings before the impact of interest expense, significant portions of which tend to be more recurring than realized carried interest and realized investment income from quarter to quarter.
Net realized investment income – KKR (ex-KFN) refers to net cash income from (i) realized investment gains and losses excluding certain realized investment losses to the extent unrealized losses on these investments were recognized prior to the combination with KPE on October 1, 2009, (ii) dividend income, and (iii) interest income net of interest expense in each case generated by KKR (excluding KFN). This term describes a portion of KKR’s quarterly distribution and excludes net realized investment income of KFN.
Net realized investment income – KFNrefers to net cash income from (i) realized investment gains and losses, (ii) dividend income and (iii) interest income net of interest expense less certain general and administrative expenses incurred in the generation of net realized investment income in each case generated by KFN. This term describes a portion of KKR’s quarterly distribution.
Investmentsis a term used solely for purposes of financial presentation of a portion of KKR’s balance sheet and includes majority investments in subsidiaries that operate KKR’s asset management and broker-dealer businesses, including the general partner interests of KKR’s investment funds.
Total distributable earnings is the sum of (i) FRE, (ii) carry distributions received from KKR’s investment funds which have not been allocated as part of its carry pool, (iii) net realized investment income — KKR (ex-KFN) and (iv) net realized investment income — KFN; less (i) applicable local income taxes, if any, and (ii) noncontrolling interests. We believe this measure is useful to unitholders as it provides a supplemental measure to assess performance, excluding the impact of mark-to-market gains (losses), and amounts available for distribution to KKR unitholders. However, total distributable earnings is not a measure that calculates actual distributions under KKR’s current distribution policy.
Assets under management (“AUM”) represent the assets from which KKR is entitled to receive fees or a carried interest and general partner capital. We believe this measure is useful to unitholders as it provides additional insight into KKR’s capital raising activities and the overall activity in its investment funds. KKR calculates the amount of AUM as of any date as the sum of: (i) the fair value of the investments of KKR’s investment funds plus uncalled capital commitments from these funds; (ii) the fair value of investments in KKR’s co-investment vehicles; (iii) the net asset value of certain of KKR’s fixed income products; (iv) the value of outstanding CLOs (excluding CLOs wholly-owned by KKR); and (v) the fair value of other assets managed by KKR. AUM excludes those assets managed by entities where KKR does not hold more than a 50% ownership interest. KKR’s definition of AUM is not based on any definition of AUM that may be set forth in the agreements governing the investment funds, vehicles or accounts that it manages or calculated pursuant to any regulatory definitions.
Fee paying AUM (“FPAUM”)represents only those assets under management from which KKR receives management fees. We believe this measure is useful to unitholders as it provides additional insight into the capital base upon which KKR earns management fees. This relates to KKR’s capital raising activities and the overall activity in its investment funds or CLOs, for only those funds or CLOs where KKR receives fees (i.e., excluding vehicles that receive only carried interest or general partner capital). FPAUM is the sum of all of the individual fee bases that are used to calculate KKR’s fees and differs from AUM in the following respects: (i) assets from which KKR does not receive a fee are excluded (i.e., assets with respect to which it receives only carried interest) and (ii) certain assets, primarily in its private equity funds, are reflected based on capital commitments and invested capital as opposed to fair value because fees are not impacted by changes in the fair value of underlying investments.
Equity investedis the aggregate amount of equity capital that has been invested by KKR’s investment funds and carry-yielding co-investment vehicles and is used as a measure of investment activity for KKR and its business segments during a given period. We believe this measure is useful to unitholders as it provides additional insight into KKR’s investments among its investment funds and carry-yielding co-investment vehicles and replaces committed dollars invested. Such amounts include: (i) capital invested by fund investors and co-investors with respect to which KKR is entitled to a carried interest and (ii) capital invested by KKR’s investment funds, including investments made using investment financing arrangements.
Gross dollars invested is the aggregate amount of capital that has been invested by all of KKR’s Public Markets investment vehicles in our private credit non-liquid strategies and is used as a measure of investment activity for a portion of KKR’s Public Markets segment in a given period. We believe this measure is useful to unitholders as it provides additional insight into KKR’s investment of capital across private credit non-liquid strategies for all the investment vehicles in the Public Markets segment. Such amounts include capital invested by fund investors and co-investors with respect to which KKR’s Public Markets business is entitled to a fee or carried interest.
Syndicated capitalis generally the aggregate amount of capital in transactions originated by KKR investment funds and carry-yielding co-investment vehicles, which has been distributed to third parties in exchange for a fee. It does not include (i) capital invested in such transactions by KKR investment funds and carry-yielding co-investment vehicles, which is instead reported in equity invested and (ii) debt capital that is arranged as part of the acquisition financing of transactions originated by KKR investment funds. Syndicated capital is used as a measure of investment activity for KKR and its business segments during a given period, and we believe that this measure is useful to unitholders as it provides additional insight into levels of syndication activity in KKR’s Capital Markets and Other segment and across its investment platform.
Uncalled commitments are used as a measure of unfunded capital commitments that KKR’s investment funds and carry-paying co-investment vehicles have received from partners to contribute capital to fund future investments. We believe this measure is useful to unitholders as it provides additional insight into the amount of capital that is available to KKR’s investment funds to make future investments. Uncalled commitments are not reduced for investments completed using fund-level investment financing arrangements.
Adjusted units are used as a measure of the total equity ownership of KKR that is held by KKR & Co. L.P. (including equity awards issued under the Equity Incentive Plan), KKR Holdings and other holders of securities exchangeable into common units of KKR & Co. L.P. and represent the fully diluted unit count using the if-converted method. We believe this measure is useful to unitholders as it provides an indication of the total equity ownership of KKR as if all outstanding KKR Holdings units, equity awards issued under the Equity Incentive Plan and other exchangeable securities had been exchanged for common units of KKR & Co. L.P.
Core interest expenseis used by management as an alternative measurement of interest expense incurred by KKR on a segment basis and excludes interest expense related to debt obligations from investment financing arrangements related to certain of KKR’s investment funds, investment vehicles and principal investments and also excludes interest expense incurred by KFN. The financing arrangements excluded from core interest expense are not direct obligations of the general partners of KKR’s private equity funds or its management companies, and in the case of debt obligations of KFN are non-recourse to KKR beyond the assets of KFN. On a segment basis, interest expense is included in net interest and dividends within total investment income. We believe this measure is useful to unitholders as it provides an indication of the amount of interest expense borne by KKR excluding interest expense that is allocated to KKR’s investment funds, other noncontrolling interest holders and KFN. Additionally, we believe this measure is useful for analyzing KKR’s ability to service its debt obligations other than the debt obligations of KFN.
Book valueis a measure of the net assets of KKR’s reportable segments and is used by management primarily in assessing the unrealized value of KKR’s investment portfolio, including carried interest, as well as KKR’s overall liquidity position. We believe this measure is useful to unitholders as it provides additional insight into the assets and liabilities of KKR excluding the assets and liabilities that are allocated to noncontrolling interest holders. Book value differs from KKR & Co. L.P. partners’ capital on a GAAP basis primarily as a result of the exclusion of ownership interests attributable to KKR Holdings.
Cash and short-term investments represent cash and liquid short-term investments in high-grade, short-duration cash management strategies used by KKR to generate additional yield on our excess liquidity and is used by management in evaluating KKR’s liquidity position. We believe this measure is useful to unitholders as it provides additional insight into KKR’s available liquidity. Cash and short-term investments differ from cash and cash equivalents on a GAAP basis as a result of the inclusion of liquid short-term investments in cash and short-term investments.
Return on equity measures the amount of net income generated as a percentage of capital invested in KKR’s business. Return on equity is calculated by dividing Economic Net Income (Loss), After Taxes on a trailing twelve-month basis by the average book value during the period.
Cash return on equity measures the amount of cash income generated as a percentage of capital invested in KKR’s business. Cash return on equity is calculated by dividing Distributable Earnings, net of taxes on a trailing twelve-month basis by the average book value during the period.
KKR
EXHIBIT A
KKR'S PORTION OF TOTAL UNCALLED COMMITMENTS TO ITS INVESTMENT FUNDS
(Amounts in thousands)
Uncalled Commitments
Private Markets
Energy Income and Growth Fund $ 208,500
North America Fund XI 169,700
Real Estate Partners Americas 136,000
Asian Fund II 51,800
European Fund III 47,300
2006 Fund 23,400
Infrastructure 10,600
Natural Resources 8,200
Other Private Equity Funds 9,400
Co-Investment Vehicles 29,300
Total Private Markets Commitments 694,200
Public Markets
Special Situations Vehicles 89,000
Direct Lending Vehicles 64,400
Mezzanine Fund 12,200
Other Credit Vehicles 2,300
Total Public Markets Commitments 167,900
Total Uncalled Commitments $ 862,100
KKR
EXHIBIT B
RECONCILIATION OF NET INCOME (LOSS) ATTRIBUTABLE TO KKR & CO. L.P. PER COMMON UNIT - BASIC (GAAP BASIS)
TO ENI AFTER TAXES PER ADJUSTED UNIT (UNAUDITED)
(Amounts in thousands, except common unit and per common unit amounts)
Quarter Ended
September 30, 2014 June 30, 2014 September 30, 2013
Net income (loss) attributable to KKR & Co. L.P. per common unit - Basic $ 0.21 $ 0.47 $ 0.73
Weighted Average Common Units Outstanding - Basic 419,961,455 377,542,161 282,148,802
Net income (loss) attributable to KKR & Co. L.P. 89,938 178,215 204,740
Plus: Net income (loss) attributable to noncontrolling interests held by KKR Holdings L.P.
100,910 186,776 300,169
Plus: Non-cash equity-based charges 83,950 92,957 85,215
Plus: Amortization of intangibles and other, net 204,676 37,455 15,979
Plus: Income taxes 29,267 6,176 7,644
Economic net income (loss) 508,741 501,579 613,747
Less: Provision for income taxes 47,361 6,330 11,950
Less: Equity-based charges associated with the KKR & Co. L.P. 2010 equity incentive plan 42,090 40,877 31,227
Economic net income (loss) after taxes 419,290 454,372 570,570
Weighted Average Adjusted Units 835,957,683 800,747,528 715,781,663
Economic net income (loss) after taxes per adjusted unit $ 0.50 $ 0.57 $ 0.80
Nine Months Ended
September 30, 2014 September 30, 2013
Net income (loss) attributable to KKR & Co. L.P. per common unit - Basic $ 1.31 $ 1.53
Weighted Average Common Units Outstanding - Basic 364,127,956 270,484,224
Net income (loss) attributable to KKR & Co. L.P. 478,194 413,313
Plus: Net income (loss) attributable to noncontrolling interests held by KKR Holdings L.P.
588,500 662,387
Plus: Non-cash equity-based charges 254,435 247,183
Plus: Amortization of intangibles and other, net 262,300 57,524
Plus: Income taxes 57,145 25,525
Economic net income (loss) 1,640,574 1,405,932
Less: Provision for income taxes 90,272 45,553
Less: Equity-based charges associated with the KKR & Co. L.P. 2010 equity incentive plan 122,320 84,581
Economic net income (loss) after taxes 1,427,982 1,275,798
Weighted Average Adjusted Units 787,502,790 714,171,641
Economic net income (loss) after taxes per adjusted unit $ 1.81 $ 1.79
KKR
EXHIBIT B (CONTINUED)
RECONCILIATION OF NET INCOME (LOSS) ATTRIBUTABLE TO KKR & CO. L.P. (GAAP BASIS)
TO ECONOMIC NET INCOME (LOSS), FEE RELATED EARNINGS, FEE AND YIELD EARNINGS, FEE AND YIELD EBITDA, TOTAL DISTRIBUTABLE EARNINGS, AND TOTAL EBITDA
(UNAUDITED)
(Amounts in thousands)
Quarter Ended
September 30, 2014 June 30, 2014 September 30, 2013
Net income (loss) attributable to KKR & Co. L.P. $ 89,938 $ 178,215 $ 204,740
Plus: Net income (loss) attributable to noncontrolling interests held by KKR Holdings L.P.
100,910 186,776 300,169
Plus: Non-cash equity-based charges 83,950 92,957 85,215
Plus: Amortization of intangibles and other, net 204,676 37,455 15,979
Plus: Income taxes 29,267 6,176 7,644
Economic net income (loss) 508,741 501,579 613,747
Plus: Income attributable to segment noncontrolling interests 5,189 3,206 2,020
Less: Total investment income (loss) 207,216 162,158 303,472
Less: Net carried interest 181,111 248,902 206,257
Fee related earnings 125,603 93,725 106,038
Plus: Net interests and dividends 82,254 60,432 (779 )
Fee and yield earnings 207,857 154,157 105,259
Plus: Depreciation and amortization 3,777 4,140 3,601
Plus: Core interest expense 23,347 19,205 16,215
Fee and yield EBITDA 234,981 177,502 125,075
Less: Depreciation and amortization 3,777 4,140 3,601
Less: Core interest expense 23,347 19,205 16,215
Less: Net interests and dividends 82,254 60,432 (779 )
Plus: Realized cash carry, net of realized cash carry allocated to carry pool 147,615 333,293 48,919
Plus: Net realized investment income - KKR (ex-KFN) 192,146 245,711 102,766
Plus: Net realized investment income - KFN 52,903 36,382 -
Less: Local income taxes and noncontrolling interests 13,450 8,138 6,586
Total distributable earnings 504,817 700,973 251,137
Plus: Depreciation and amortization 3,777 4,140 3,601
Plus: Core interest expense 23,347 19,205 16,215
Plus: Local income taxes and noncontrolling interests 13,450 8,138 6,586
Total EBITDA $ 545,391 $ 732,456 $ 277,539
Nine Months Ended
September 30, 2014 September 30, 2013
Net income (loss) attributable to KKR & Co. L.P. $ 478,194 $ 413,313
Plus: Net income (loss) attributable to noncontrolling interests held by KKR Holdings L.P.
588,500 662,387
Plus: Non-cash equity-based charges 254,435 247,183
Plus: Amortization of intangibles and other, net 262,300 57,524
Plus: Income taxes 57,145 25,525
Economic net income (loss) 1,640,574 1,405,932
Plus: Income attributable to segment noncontrolling interests 11,597 4,444
Less: Total investment income (loss) 648,025 634,720
Less: Net carried interest 633,100 483,441
Fee related earnings 371,046 292,215
Plus: Net interests and dividends 153,850 1,532
Fee and yield earnings 524,896 293,747
Plus: Depreciation and amortization 11,952 10,990
Plus: Core interest expense 60,952 48,658
Fee and yield EBITDA 597,800 353,395
Less: Depreciation and amortization 11,952 10,990
Less: Core interest expense 60,952 48,658
Less: Net interests and dividends 153,850 1,532
Plus: Realized cash carry, net of realized cash carry allocated to carry pool 597,038 263,716
Plus: Net realized investment income - KKR (ex-KFN) 630,749 406,283
Plus: Net realized investment income - KFN 89,285 -
Less: Local income taxes and noncontrolling interests 35,520 16,687
Total distributable earnings 1,652,598 945,527
Plus: Depreciation and amortization 11,952 10,990
Plus: Core interest expense 60,952 48,658
Plus: Local income taxes and noncontrolling interests 35,520 16,687
Total EBITDA $ 1,761,022 $ 1,021,862
KKR
EXHIBIT B (CONTINUED)
RECONCILIATION OF KKR & CO. L.P. PARTNERS' CAPITAL (GAAP BASIS)
TO BOOK VALUE AND BOOK VALUE PER ADJUSTED UNIT (UNAUDITED)
(Amounts in thousands, except common unit and per common unit amounts)
As of As of
September 30, 2014 December 31, 2013
KKR & Co. L.P. partners’ capital $ 5,486,179 $ 2,722,010
Noncontrolling interests held by KKR Holdings L.P. 4,887,534 5,116,761
Equity impact of KKR Management Holdings Corp. and other 104,540 (76,171 )
Book value 10,478,253 7,762,600
Adjusted units 837,651,175 716,676,699
Book value per adjusted unit $ 12.51 $ 10.83
RECONCILIATION OF CASH AND CASH EQUIVALENTS (GAAP BASIS)
TO CASH AND SHORT-TERM INVESTMENTS (UNAUDITED)
(Amounts in thousands)
As of As of
September 30, 2014 December 31, 2013
Cash and cash equivalents $ 1,472,760 $ 1,306,383
Liquid short-term investments 667,296 854,714
Cash and short-term investments $ 2,140,056 $ 2,161,097
KKR
EXHIBIT C
RECONCILIATION OF WEIGHTED AVERAGE GAAP COMMON UNITS OUTSTANDING - BASIC TO WEIGHTED AVERAGE ADJUSTED UNITS (UNAUDITED)
The following table provides a reconciliation of KKR's Weighted Average GAAP Common Units Outstanding to Weighted Average Adjusted Units.
Quarter Ended
September 30, 2014 June 30, 2014 September 30, 2013
Weighted Average GAAP Common Units Outstanding - Basic 419,961,455 377,542,161 282,148,802
Adjustments:
Weighted Average Unvested Common Units(a) 26,862,703 27,536,748 25,986,389
Weighted Average Other Exchangeable Securities 5,195,584 5,100,929 -
Weighted Average GAAP Common Units Outstanding - Diluted 452,019,742 410,179,838 308,135,191
Adjustments:
Weighted Average KKR Holdings Units (b) 383,937,941 390,567,690 407,646,472
Weighted Average Adjusted Units 835,957,683 800,747,528 715,781,663
Nine Months Ended
September 30, 2014 September 30, 2013
Weighted Average GAAP Common Units Outstanding - Basic 364,127,956 270,484,224
Adjustments:
Weighted Average Unvested Common Units(a) 27,917,101 25,696,846
Weighted Average Other Exchangeable Securities 4,187,771 -
Weighted Average GAAP Common Units Outstanding - Diluted 396,232,828 296,181,070
Adjustments:
Weighted Average KKR Holdings Units (b) 391,269,962 417,990,571
Weighted Average Adjusted Units 787,502,790 714,171,641
RECONCILIATION OF GAAP COMMON UNITS OUTSTANDING - BASIC TO ADJUSTED UNITS AND ADJUSTED UNITS ELIGIBLE FOR DISTRIBUTION (UNAUDITED)
The following table provides a reconciliation of KKR's GAAP Common Units Outstanding to Adjusted Units and Adjusted Units Eligible for Distribution.
As of As of
September 30, 2014 December 31, 2013
GAAP Common Units Outstanding - Basic 424,041,543 288,143,327
Unvested Common Units(a) 26,116,449 24,164,354
Other Exchangeable Securities 5,195,584 -
GAAP Common Units Outstanding - Diluted 455,353,576 312,307,681
Adjustments:
KKR Holdings Units (b) 382,297,599 404,369,018
Adjusted Units 837,651,175 716,676,699
Adjustments:
Unvested Common Units (26,116,449 ) (24,164,354 )
Unvested Other Exchangeable Securities (2,836,714 ) -
Adjusted Units Eligible For Distribution 808,698,012 692,512,345
________________________________________________________________________________________________
(a) Represents equity awards granted under the KKR & Co. L.P. 2010 Equity Incentive Plan. The issuance of common units of KKR & Co. L.P. pursuant to awards under its equity incentive plan dilutes KKR common unitholders and KKR Holdings pro rata in accordance with their respective percentage interests in the KKR business.
(b) Common units that may be issued by KKR & Co. L.P. upon exchange of units in KKR Holdings L.P. for KKR common units.
KKR
Contact:
Investor Relations:
Kohlberg Kravis Roberts & Co. L.P.
Craig Larson
+1 (877) 610-4910 (U.S.) / +1 (212) 230-9410
investor-relations@kkr.com
KKR Completes Acquisition of Goodpack Limited
KKR in the right place at the right time!!!
The "Street" has KKR coming in at .56394 for the quarter that should be reported on or about May 24, 2014! All post's welcome! The "Good Dr's In"!
KKR buy before it runs again IMO!!!
KKR & Co. L.P. to Announce First Quarter 2014 Results
Business Wire KKR & Co. L.P.
April 10, 2014 8:10 AM
NEW YORK--(BUSINESS WIRE)--
KKR & Co. L.P. (KKR) announced today that it plans to release its financial results for the first quarter 2014 on Thursday, April 24, 2014, before the opening of trading on the New York Stock Exchange.
A conference call to discuss KKR’s financial results will be held on Thursday, April 24, 2014 at 10:00 a.m. EDT. The conference call may be accessed by dialing (877) 303-2917 (U.S. callers) or +1 (253) 237-1135 (non-U.S. callers); a pass code is not required. Additionally, the conference call will be broadcast live over the Internet and may be accessed through the Investor Center section of KKR’s website at http://ir.kkr.com/kkr_ir/kkr_events.cfm.
A replay of the live broadcast will be available on KKR’s website or by dialing (855) 859-2056 (U.S. callers) or +1 (404) 537-3406 (non-U.S. callers), pass code 26683527, beginning approximately two hours after the broadcast.
ABOUT KKR
Founded in 1976 and led by Henry Kravis and George Roberts, KKR is a leading global investment firm with $94.3 billion in assets under management as of December 31, 2013. With offices around the world, KKR manages assets through a variety of investment funds and accounts covering multiple asset classes. KKR seeks to create value by bringing operational expertise to its portfolio companies and through active oversight and monitoring of its investments. KKR complements its investment expertise and strengthens interactions with fund investors through its client relationships and capital markets platform. KKR & Co. L.P. is publicly traded on the New York Stock Exchange (KKR) and "KKR", as used in this release, includes its subsidiaries, their managed investment funds and accounts, and/or their affiliated investment vehicles, as appropriate. For additional information, please visit KKR's website at www.kkr.com.
Contact:
Kohlberg Kravis Roberts & Co. L.P.
Investor Relations:
Craig Larson
+1 877-610-4910 (U.S.) / +1 212-230-9410
investor-relations@kkr.com
or
Media:
Kristi Huller
+1 212-750-8300
media@kkr.com
Last couple of years the exdd was early first week of may. Good luck. I have both Kkr and kfn and have them both on dividend reinvestment
jcpny777
End of this month for the vote(I think). Thinking about buying KKR. Wanted to take advantage of the qtr dividend if possible for the next qtr.
Take Care
David
Not sure when this will transpire but under the agreement, which has been approved by the boards of directors of both KKR and KFN, in KFN's case based on the unanimous recommendation of a committee of independent directors of KFN, shareholders of KFN will receive 0.51 common units of KKR for each common share of KFN
Kkr @ $22.42 pays 6.09%. Last exdd was 2/13 and paid $.48
Kfn @ $11.42 pays 7.53%. Last exdd was 2/11 and Paid $.22
About 8% but I'm not sure of the date.
OG
What is KKR's dividend rate and when do you have to hold the stock to qualify for the dividend?
Thanks
Exceptional management at KKR!
Eyeglass World has an awesome footprint in the industry! My wife just got her new glasses last week and my oldest son got his new glasses today. KKR is making all the right moves in this twilight zone obama economy!
Forgot to add that George Roberts also demonstrates unmatched leadership qualities in his community! The sad thing is that they get trashed for being successful and making what they earned by placing themselves in the right places at the right time with the right education that they attempted and finished. The media doesn't show the good side, they only enjoy trashing them for making millions instead of teaching our kids, MAKE THE RIGHT CHOICES and you can be there also! Give a million $'s to some of these folks that claim our system is not fair and blame others for not getting ahead and they will be poor and blaming again within 2 years!!!!
Lots of respect for these guys especially Henry Kravis. I love how he has always helped out charities and communities! Been watching them since the 80's!
National Vision to be Acquired by KKR
Business Wire KKR
February 7, 2014 9:01 AM
LAWRENCEVILLE, Ga.--(BUSINESS WIRE)--
National Vision, Inc. (NVI), the leading independent value retailer of eyeglasses and contact lenses, and leading global investment firm KKR today announced that a definitive agreement has been signed whereby KKR will acquire the company from Berkshire Partners, a Boston-based investment firm. Terms of the transaction were not disclosed.
NVI is the fastest growing independent optical retailer and is one of the few retailers that is focused exclusively on the value segment of the industry. The company operates over 750 low price vision centers across the United States, including America’s Best Contacts & Eyeglasses and Eyeglass World free-standing concepts and vision centers inside Walmart, Fred Meyer and on U.S. Military bases. NVI also sells its products direct to consumers through 25 consumer-facing websites, including www.aclens.com and www.discountcontactlenses.com.
“We have had an absolutely marvelous eight year relationship with Berkshire Partners and are so appreciative of all they have done to support our growth and help get us to where we are today,” said Reade Fahs, CEO of NVI. “The NVI team is anticipating and looking forward to a very similar sort of relationship with KKR.”
“NVI has a bright future ahead of it, and we are excited to partner with this proven management team on its next chapter of growth. Through its broad store base and leading e-commerce platform, the company is poised to benefit from the growth in this highly attractive value segment of the optical industry. As NVI continues to grow, we also look forward to supporting its important social mission,” Nate Taylor, Member of KKR, said.
NVI is dedicated to “serving the underserved” by providing eye health care and eyeglasses to those who otherwise would not have access to affordable vision improvement. NVI has been a strategic partner of VisionSpring, supporting its work to create sustainable business models to serve low-income individuals in El Salvador, India and Bangladesh. NVI also supports RestoringVision.org in its work to provide readers and sunglasses for distribution by American Mission goers abroad. In addition, NVI created and manages their own charity called Frames For The World that collects new eyeglass frames from manufacturers who have overstock and distributes the frames in bulk to clinics serving the poor in the developing world so they can bring sight to more people.
KKR is making the investment from its North American XI private equity fund. The acquisition, which is expected to close by the end of the first quarter, is subject to regulatory approvals and customary closing conditions. The management team of NVI is expected to remain a significant investor in the business.
Barclays acted as lead financial advisor to NVI, with Wells Fargo as co-advisor. Weil, Gotshal & Manges LLP acted as legal advisor to Berkshire Partners and NVI. Simpson Thacher & Bartlett LLP acted as legal advisor to KKR.
About National Vision
National Vision, Inc. (NVI) is the fourth largest optical retailer in the United States, operating over 750 retail locations in 43 states plus the District of Columbia and Puerto Rico. National Vision employs over 7,000 people and has several retail divisions including America's Best Contacts & Eyeglasses, Eyeglass World, Vision Centers inside select Wal-Mart, Vista Optical inside Fred Meyer and Optical Centers on select military bases.
About KKR
Founded in 1976 and led by Henry Kravis and George Roberts, KKR is a leading global investment firm with $94.3 billion in assets under management as of December 31, 2013. With offices around the world, KKR manages assets through a variety of investment funds and accounts covering multiple asset classes. KKR seeks to create value by bringing operational expertise to its portfolio companies and through active oversight and monitoring of its investments. KKR complements its investment expertise and strengthens interactions with fund investors through its client relationships and capital markets platform. KKR & Co. L.P. is publicly traded on the New York Stock Exchange (KKR) and “KKR”, as used in this release, includes its subsidiaries, their managed investment funds and accounts, and/or their affiliated investment vehicles, as appropriate. For additional information, please visit KKR’s website at www.kkr.com.
About Berkshire Partners
Berkshire Partners, the Boston-based investment firm, has invested in over 100 middle market companies since 1986 through eight private equity funds with aggregate capital commitments of $11 billion. Berkshire has developed specific industry experience in several areas including consumer products and retail, business services, industrial manufacturing, transportation and communications. Berkshire has a strong history of partnering with management teams to grow the companies in which it invests with the goal of consistently achieving superior investment returns. The firm is currently investing from Berkshire Fund VIII, a $4.5 billion fund raised in 2011. Berkshire seeks to invest $50 million to $500 million of equity capital in each portfolio company. For additional information, visit www.berkshirepartners.com.
Contact:
Media
For National Vision, Inc. media inquiries:
Pam Bisikirski, 770-822-4252
Pam.Bisikirski@nationalvision.com
or
For KKR media inquiries:
Kristi Huller, 212-750-8300
Kristi.Huller@kkr.com
or
For Berkshire Partners media inquiries:
Katie Bush, 617-227-0050
Kbush@berkshirepartners.com
Best management team of any company!!!
KKR & Co. L.P. Announces Fourth Quarter and Full Year 2013 Results
Strong Investment Returns Drive Record Economic Net Income
GAAP net income (loss) attributable to KKR & Co. L.P. was $277.9 million and $691.2 million for the quarter and year ended December 31, 2013, respectively, up from $96.7 million and $560.8 million in the comparable periods of 2012.
Assets under management (“AUM”) totaled $94.3 billion as of December 31, 2013, up from $75.5 billion as of December 31, 2012. Fee paying assets under management (“FPAUM”) totaled $77.4 billion as of December 31, 2013, up from $60.8 billion as of December 31, 2012.
Total distributable earnings were $510.4 million for the quarter ended December 31, 2013, down from $546.3 million for the quarter ended December 31, 2012. Total distributable earnings were $1,455.9 million for the year December 31, 2013, up from $1,449.4 million in the comparable period of 2012.
Economic net income (“ENI”) was $789.6 million and $2,195.6 million for the quarter and year ended December 31, 2013, respectively, up from $347.7 million and $2,130.9 million in the comparable periods of 2012. Return on equity was 27.4% for the year ended December 31, 2013.
After-tax ENI was $1.08 and $2.99 per adjusted unit for the quarter and year ended December 31, 2013, respectively, up from $0.48 and $2.90 per adjusted unit in the comparable periods on 2012.
Fee related earnings (“FRE”) were $120.1 million and $412.3 million for the quarter and year ended December 31, 2013, respectively, up from $86.0 million and $319.8 million in the comparable periods of 2012.
Book value was $7.8 billion on a total reportable segment basis as of December 31, 2013 or $10.83 per adjusted unit.
KKR & Co. L.P. declares a fourth quarter distribution of $0.48 per common unit, bringing year-to-date distributions for 2013 to $1.40 per common unit, up from $1.22 per common unit for 2012.
KKR & Co. L.P. announced a transaction to acquire KKR Financial Holdings LLC (“KFN”).
Business Wire KKR & Co. L.P.
2 hours ago
NEW YORK--(BUSINESS WIRE)--
KKR & Co. L.P. (KKR) today reported its fourth quarter and full year 2013 results.
For the fourth quarter and year ended December 31, 2013, the carrying value of our private equity investment portfolio appreciated 8.4% and 20.2%, respectively.
AUM and FPAUM were $94.3 billion and $77.4 billion, respectively, as of December 31, 2013, both up from September 30, 2013.
We recently held our final close for our North America Fund XI L.P., Real Estate Partners Americas L.P., and Special Situations Fund L.P. Including general partner, employee and affiliate commitments, our North America Fund XI L.P. closed with $9.0 billion of commitments, Real Estate Partners Americas L.P. closed with $1.5 billion of commitments, and the Special Situations Fund L.P. closed with $2.0 billion of commitments.
On December 16, 2013, KKR announced the signing of a definitive merger agreement where KKR will acquire KFN through a stock-for-stock merger. KFN is a specialty finance company with a portfolio of assets spanning a complementary range of strategies, principally leveraged credit through ownership of subordinated and mezzanine notes across a number of CLOs; special situations; and Private Markets strategies including natural resources, commercial real estate and private equity. KFN is externally managed by KKR. The merger, which is subject to KFN shareholder approval, customary regulatory approvals and other customary closing conditions, is expected to close in the first half of 2014.
In the near term, we expect to close on the acquisition of Avoca Capital (Unlimited) and its affiliates (“Avoca”), a European credit investment manager. The addition of Avoca provides KKR with a leading presence in the European leveraged credit markets and will enable us to expand our credit platform to offer a full spectrum of credit opportunities globally for our fund investors. As of December 31, 2013, Avoca had $8.4 billion in assets under management, which are not included in either AUM or FPAUM.
“Our investment performance, cash flow generation, and balance sheet income translated into $1.5 billion in total distributable earnings, a 27% return on equity, and a distribution of $1.40 per unit for 2013, our highest annual distribution as a public company,” said Henry R. Kravis and George R. Roberts, Co-Chairmen and Co-Chief Executive Officers of KKR. “We continued to see progress across our capital raising, investment performance, monetization and strategic initiatives."
_______________________________________________________________________________________________________
Note: Certain financial measures, including FRE, ENI, after-tax ENI, ENI after taxes and equity-based charges, fee related EBITDA, book value, cash and short-term investments and adjusted units, are not presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”). See Exhibits A and B for a reconciliation of such measures to financial results prepared in accordance with GAAP.
GAAP RESULTS
GAAP results for the quarter and year ended December 31, 2013 included net income attributable to KKR & Co. L.P. of $277.9 million and $691.2 million, respectively, and net income attributable to KKR & Co. L.P. per common unit of $0.89 and $2.30, respectively, on a diluted basis. For the quarter and year ended December 31, 2012, net income attributable to KKR & Co. L.P. was $96.7 million and $560.8 million, respectively, and net income attributable to KKR & Co. L.P. per common unit were $0.36 and $2.21, respectively, on a diluted basis. The increase quarter over quarter was primarily due to (i) an increase in management fees attributable to new capital raised; (ii) higher transaction fees; (iii) a higher level of total investment income; and (iv) an increase in KKR & Co. L.P.’s ownership percentage in the KKR business. The year over year increase was primarily due to (i) an increase in management fees attributable to new capital raised; (ii) higher transaction fees; (iii) the acquisition of Prisma; and (iv) an increase in KKR & Co. L.P.’s ownership percentage in the KKR business.
SEGMENT RESULTS
Private Markets
AUM was $61.2 billion as of December 31, 2013, an increase of $1.5 billion, or 2.5%, compared to AUM of $59.7 billion as of September 30, 2013. The increase was primarily attributable to appreciation in the fair value of our private equity portfolio and to a lesser extent new capital raised from fund investors. The increase was partially offset by distributions to the limited partners of our private equity funds arising from realizations.
FPAUM was $50.2 billion as of December 31, 2013, an increase of $0.3 billion, or 0.6%, compared to FPAUM of $49.9 billion as of September 30, 2013. The increase was primarily attributable to new capital raised from fund investors largely offset by distributions to the limited partners of our private equity funds arising from realizations.
FRE was $30.5 million for the quarter ended December 31, 2013, a decrease of $1.9 million, or 5.9%, compared to FRE of $32.4 million for the quarter ended December 31, 2012. The decrease was primarily driven by higher compensation expense due to additional headcount and higher other operating expenses. The decrease was partially offset by higher management fees resulting from new capital raised and higher transaction fees.
FRE was $158.3 million for the year ended December 31, 2013, an increase of $7.3 million, or 4.8%, compared to FRE of $151.0 million for the year ended December 31, 2012. The increase was primarily driven by higher management fees resulting from new capital raised and higher transaction fees. The increase was partially offset by higher compensation expense due to additional headcount and higher other operating expenses.
ENI was $368.6 million for the quarter ended December 31, 2013, an increase of $190.8 million, or 107.3%, compared to ENI of $177.8 million for the quarter ended December 31, 2012. The increase was primarily attributable to higher net carried interest resulting from a higher level of appreciation in our private equity portfolio.
ENI was $952.5 million for the year ended December 31, 2013, an increase of $120.8 million, or 14.5%, compared to ENI of $831.7 million for the year ended December 31, 2012. The increase was primarily attributable to higher net carried interest resulting from a lower level of management fee refunds and the increase in FRE discussed above.
Public Markets
AUM was $33.1 billion as of December 31, 2013, an increase of $2.6 billion, or 8.5%, compared to AUM of $30.5 billion as of September 30, 2013. FPAUM was $27.2 billion as of December 31, 2013, an increase of $3.5 billion, or 14.8%, compared to FPAUM of $23.7 billion as of September 30, 2013. For both AUM and FPAUM, the increases were primarily attributable to net new capital raised from fund investors.
FRE was $63.6 million for the quarter ended December 31, 2013, an increase of $34.2 million, or 116.3%, compared to FRE of $29.4 million for the quarter ended December 31, 2012. The increase was principally attributable to higher incentive fees earned and higher management fees related to new capital raised from fund investors. The increase was partially offset by higher operating expenses.
FRE was $155.4 million for the year ended December 31, 2013, an increase of $74.9 million, or 93.0%, compared to FRE of $80.5 million for the year ended December 31, 2012. The increase was primarily attributable to (i) higher management fees related to new capital raised from fund investors,(ii) the acquisition of Prisma and (iii) higher incentive fees earned. The increase was partially offset by higher operating expenses primarily related to one-time expenses incurred in connection with the launch of a closed-end fund in 2013.
ENI was $73.3 million for the quarter ended December 31, 2013, an increase of $35.9 million, or 96.0%, compared to ENI of $37.4 million for the quarter ended December 31, 2012. The increase was primarily driven by the increase in FRE discussed above.
ENI was $191.4 million for the year ended December 31, 2013, an increase of $88.5 million, or 86.0%, compared to ENI of $102.9 million for the year ended December 31, 2012. The increase was primarily driven by the increase in FRE discussed above and to a lesser extent higher net carried interest due to certain credit investment vehicles beginning to earn carry in 2013.
Capital Markets and Principal Activities
FRE was $26.0 million for the quarter ended December 31, 2013, an increase of $1.8 million, or 7.4%, compared to FRE of $24.2 million for the quarter ended December 31, 2012. FRE was $98.7 million for the year ended December 31, 2013, an increase of $10.4 million, or 11.8%, compared to FRE of $88.3 million for the year ended December 31, 2012. The increases in both comparable periods were primarily driven by a higher level of overall capital markets transaction activity, partially offset by higher compensation expense.
ENI was $347.8 million for the quarter ended December 31, 2013, an increase of $215.2 million, or 162.3%, compared to ENI of $132.6 million for the quarter ended December 31, 2012. The increase was primarily attributable to a higher level of investment income from our principal investments.
ENI was $1,051.7 million for the year ended December 31, 2013, a decrease of $144.5 million, or 12.1%, compared to ENI of $1,196.2 million for the year ended December 31, 2012. The decrease was primarily due to a lower level of investment income from our principal investments, partially offset by the increase in FRE discussed above. While the fair value of our principal investments increased during the year ended December 31, 2013, the level of appreciation was lower than in 2012.
CAPITAL AND LIQUIDITY
As of December 31, 2013, KKR had $2.2 billion of cash and short-term investments on a total reportable segment basis and $1.0 billion of outstanding debt obligations. KKR’s availability for borrowings was $750.0 million (which is reduced by an outstanding letter of credit), which does not include a $500.0 million revolving credit facility for use in its capital markets business that was undrawn as of December 31, 2013.
As of December 31, 2013, KKR’s portion of total uncalled commitments to its investment funds was $1.2 billion, consisting of the following (amounts in thousands):
Uncalled
Commitments
Private Markets
North America Fund XI $ 324,800
Energy Income and Growth Fund 227,500
Real Estate Partners Americas 123,200
European Fund III 121,500
Asian Fund II 72,400
2006 Fund 61,700
Infrastructure 19,900
Natural Resources 11,100
China Growth Fund 6,400
Asian Fund 3,700
E2 Investors (Annex Fund) 900
Co-Investment Vehicles 39,200
Total Private Markets Commitments 1,012,300
Public Markets
Special Situations Vehicles 125,900
Mezzanine Fund 21,200
Direct Lending Vehicles 12,600
Total Public Markets Commitments 159,700
Total Uncalled Commitments $ 1,172,000
DISTRIBUTION
A distribution of $0.48 per common unit has been declared, comprised of (i) $0.12 per common unit from after-tax FRE, (ii) $0.22 per common unit from realized cash carry, and (iii) $0.14 per common unit from net realized principal investment income. The distribution will be paid on March 4, 2014 to unitholders of record as of the close of business on February 18, 2014. Please refer to the distribution policy presented later in this release.
CONFERENCE CALL
A conference call to discuss KKR’s financial results will be held on Thursday, February 6, 2014 at 10:00 a.m. EST. The conference call may be accessed by dialing (877) 303-2917 (U.S. callers) or +1 (253) 237-1135 (non-U.S. callers); a pass code is not required. Additionally, the conference call will be broadcast live over the Internet and may be accessed through the Investors Center section of KKR’s website at http://ir.kkr.com/kkr_ir/kkr_events.cfm. A replay of the live broadcast will be available on KKR’s website or by dialing (855) 859-2056 (U.S. callers) or +1 (404) 537-3406 (non-U.S. callers), pass code 35363339 beginning approximately two hours after the broadcast.
From time to time, KKR may use its website as a channel of distribution of material company information. Financial and other important information regarding KKR is routinely posted and accessible on the Investor Center for KKR & Co. L.P. at http://ir.kkr.com/kkr_ir/kkr_events.cfm. In addition, you may automatically receive email alerts and other information about KKR by enrolling your email address at the “Email Alerts” area of the Investor Center on the website.
ABOUT KKR
Founded in 1976 and led by Henry Kravis and George Roberts, KKR is a leading global investment firm with $94.3 billion in assets under management as of December 31, 2013. With offices around the world, KKR manages assets through a variety of investment funds and accounts covering multiple asset classes. KKR seeks to create value by bringing operational expertise to its portfolio companies and through active oversight and monitoring of its investments. KKR complements its investment expertise and strengthens interactions with fund investors through its client relationships and capital markets platform. KKR & Co. L.P. is publicly traded on the New York Stock Exchange (KKR) and “KKR”, as used in this release, includes its subsidiaries, their managed investment funds and accounts, and/or their affiliated investment vehicles, as appropriate. For additional information, please visit KKR’s website at www.kkr.com.
FORWARD-LOOKING STATEMENTS
This release contains certain forward-looking statements. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. The forward-looking statements are based on KKR’s beliefs, assumptions and expectations of its future performance, taking into account all information currently available to it. These beliefs, assumptions and expectations can change as a result of many possible events or factors, not all of which are known to KKR or are within its control. If a change occurs, KKR’s business, financial condition, liquidity and results of operations, including but not limited to AUM, FPAUM, FRE, total distributable earnings, ENI, after-tax ENI, ENI after taxes and equity-based charges, fee related EBITDA, committed dollars invested and syndicated capital, uncalled commitments, core interest expense, cash and short-term investments, net realized principal investment income and book value, may vary materially from those expressed in the forward-looking statements. The following factors, among others, could cause actual results to vary from the forward-looking statements: the general volatility of the capital markets; failure to realize the benefits of or changes in KKR’s business strategies including the ability to realize the anticipated synergies from acquisitions or strategic partnerships such as Prisma, Nephila, Avoca or KFN; availability, terms and deployment of capital; availability of qualified personnel and expense of recruiting and retaining such personnel; changes in the asset management industry, interest rates or the general economy; underperformance of KKR's investments and decreased ability to raise funds; and the degree and nature of KKR’s competition. KKR does not undertake any obligation to update any forward-looking statements to reflect circumstances or events that occur after the date on which such statements were made except as required by law. In addition, KKR’s business strategy is focused on the long term and financial results are subject to significant volatility. Additional information about factors affecting KKR is available in KKR & Co. L.P.’s Annual Report on Form 10-K for the fiscal year ended December 31, 2012, filed with the SEC on February 22, 2013, and other filings with the SEC, which are available at www.sec.gov.
KKR
CONSOLIDATED STATEMENTS OF OPERATIONS (GAAP BASIS - UNAUDITED)
(Amounts in thousands, except common unit and per common unit amounts)
Quarter Ended Year Ended
December 31, 2013 December 31, 2012 December 31, 2013 December 31, 2012
Revenues
Fees $ 224,902 $ 177,621 $ 762,546 $ 568,442
Expenses
Compensation and Benefits 405,687 261,454 1,266,592 1,280,854
Occupancy and Related Charges 15,684 14,569 61,720 58,205
General, Administrative and Other 158,920 82,249 438,826 259,729
Total Expenses 580,291 358,272 1,767,138 1,598,788
Investment Income (Loss)
Net Gains (Losses) from Investment Activities 3,227,327 874,507 7,826,082 7,871,673
Dividend Income 325,507 677,590 695,521 940,888
Interest Income 122,509 98,929 474,759 358,598
Interest Expense (26,923 ) (16,407 ) (99,616 ) (69,164 )
Total Investment Income (Loss) 3,648,420 1,634,619 8,896,746 9,101,995
Income (Loss) Before Taxes 3,293,031 1,453,968 7,892,154 8,071,649
Income Taxes 12,401 5,628 37,926 43,405
Net Income (Loss) 3,280,630 1,448,340 7,854,228 8,028,244
Net Income (Loss) Attributable to
Redeemable Noncontrolling Interests 36,263 16,412 62,255 34,963
Net Income (Loss) Attributable to
Noncontrolling Interests 2,966,454 1,335,200 7,100,747 7,432,445
Net Income (Loss) Attributable to KKR & Co. L.P. $ 277,913 $ 96,728 $ 691,226 $ 560,836
Distributions Declared per KKR & Co. L.P. Common Unit $ 0.48 $ 0.70 $ 1.40 $ 1.22
Net Income (Loss) Attributable to KKR & Co. L.P. Per Common Unit
Basic $ 0.96 $ 0.39 $ 2.51 $ 2.35
Diluted (a) $ 0.89 $ 0.36 $ 2.30 $ 2.21
Weighted Average Common Units Outstanding
Basic 288,045,501 249,303,558 274,910,628 238,503,257
Diluted (a) 312,340,336 268,192,128 300,254,090 254,093,160
(a) KKR Holdings L.P. units have been excluded from the calculation of diluted earnings per common unit given that the exchange of these units would proportionally increase KKR & Co. L.P.’s interests in KKR’s business and would have an anti-dilutive effect on earnings per common unit as a result of certain tax benefits KKR & Co. L.P. is assumed to receive upon the exchange.
KKR
STATEMENTS OF OPERATIONS AND OTHER SELECTED FINANCIAL INFORMATION
TOTAL REPORTABLE SEGMENTS (UNAUDITED)
(Amounts in thousands, except unit and per unit amounts)
Quarter Ended Year Ended
December 31, 2013 September 30, 2013 December 31, 2012 December 31, 2013 December 31, 2012
Fees
Management and incentive fees:
Management fees $ 175,246 $ 173,245 $ 144,355 $ 665,630 $ 529,107
Incentive fees 36,695 1,225 12,350 72,359 43,845
Management and incentive fees 211,941 174,470 156,705 737,989 572,952
Monitoring and transaction fees:
Monitoring fees 26,282 33,010 32,988 120,267 116,565
Transaction fees 104,475 129,127 76,840 336,686 240,108
Fee credits (47,014 ) (61,782 ) (37,991 ) (166,612 ) (105,730 )
Net monitoring and transaction fees 83,743 100,355 71,837 290,341 250,943
Total fees 295,684 274,825 228,542 1,028,330 823,895
Expenses
Compensation and benefits 95,945 92,229 76,001 343,772 272,811
Occupancy and related charges 14,264 15,674 13,763 56,327 55,068
Other operating expenses 65,342 60,884 52,799 215,883 176,205
Total expenses 175,551 168,787 142,563 615,982 504,084
Fee Related Earnings 120,133 106,038 85,979 412,348 319,811
Investment income (loss)
Realized carried interest 250,500 81,532 168,320 690,027 475,707
Unrealized carried interest 347,239 278,004 100,616 754,423 956,203
Gross carried interest 597,739 359,536 268,936 1,444,450 1,431,910
Less: allocation to KKR carry pool (241,397 ) (145,512 ) (107,514 ) (582,949 ) (581,206 )
Less: management fee refunds (a) (8,564 ) (7,767 ) (8,712 ) (30,282 ) (143,723 )
Net carried interest 347,778 206,257 152,710 831,219 706,981
Realized other investment income (loss) 250,856 102,766 366,878 657,139 866,776
Unrealized other investment income (loss) 72,825 200,706 (256,642 ) 301,262 244,346
Total other investment income (loss) 323,681 303,472 110,236 958,401 1,111,122
Total investment income (loss) 671,459 509,729 262,946 1,789,620 1,818,103
Income (Loss) before noncontrolling interests
in Income of consolidated entities 791,592 615,767 348,925 2,201,968 2,137,914
Income (Loss) attributable to
noncontrolling interests 1,943 2,020 1,245 6,387 7,043
Economic Net Income (Loss) $ 789,649 $ 613,747 $ 347,680 $ 2,195,581 $ 2,130,871
Provision for Income Taxes 16,048 11,950 10,632 61,601 102,420
Economic Net Income (Loss), After Taxes (b) $ 773,601 $ 601,797 $ 337,048 $ 2,133,980 $ 2,028,451
Economic Net Income (Loss), After Taxes per Adjusted Unit (b) $ 1.08 $ 0.84 $ 0.48 $ 2.99 $ 2.90
Assets Under Management $ 94,320,300 $ 90,169,200 $ 75,527,500 $ 94,320,300 $ 75,527,500
Fee Paying Assets Under Management $ 77,397,500 $ 73,611,900 $ 60,846,000 $ 77,397,500 $ 60,846,000
Committed Dollars Invested and Syndicated Capital $ 2,943,500 $ 2,848,700 $ 1,715,700 $ 8,506,000 $ 4,354,900
Uncalled Commitments $ 22,463,900 $ 22,718,400 $ 16,071,900 $ 22,463,900 $ 16,071,900
Other Information
Fee Related Earnings $ 120,133 $ 106,038 $ 85,979 $ 412,348 $ 319,811
Plus: depreciation and amortization 3,658 3,601 3,580 14,648 12,499
Fee Related EBITDA $ 123,791 $ 109,639 $ 89,559 $ 426,996 $ 332,310
Total Distributable Earnings (b) $ 510,351 $ 251,137 $ 546,290 $ 1,455,878 $ 1,449,396
GAAP interest expense $ 26,923 $ 25,056 $ 16,407 $ 99,616 $ 69,164
Less: interest expense related to debt obligations
from investment financing arrangements 9,919 8,841 7,014 33,954 31,050
Core Interest Expense (b) $ 17,004 $ 16,215 $ 9,393 $ 65,662 $ 38,114
Economic Net Income (Loss),
After Taxes and Equity-based Charges (b) $ 743,473 $ 570,570 $ 321,850 $ 2,019,271 $ 1,965,574
Return on Equity (c) 27.4 % 31.0 %
(a) As of December 31, 2013, there is no carried interest subject to management fee refunds, which may reduce carried interest in future periods.
(b) See definitions for economic net income (loss), after taxes, adjusted units, total distributable earnings, core interest expense and economic net income (loss), after taxes and equity-based charges under “Notes to Reportable Segments.”
(c) Return on equity measures the amount of net income generated as a percentage of capital invested in KKR’s business. Return on equity is calculated by dividing Economic Net Income (Loss), After Taxes and Equity-based Charges by the average book value during the period.
KKR
SUPPLEMENTAL STATEMENTS OF OPERATIONS AND OTHER SELECTED FINANCIAL INFORMATION (SAMPLE)
TOTAL REPORTABLE SEGMENTS (UNAUDITED)
(Amounts in thousands, except unit and per unit amounts)
Quarter Ended Year Ended
December 31, 2013 September 30, 2013 December 31, 2012 December 31, 2013 December 31, 2012
Segment Revenues
Fees $ 295,684 $ 274,825 $ 228,542 $ 1,028,330 $ 823,895
Gross Carried Interest - net of Management Fee Refunds 589,175 351,769 260,224 1,414,168 1,288,187
Investment Income (Loss) 323,681 303,472 110,236 958,401 1,111,122
Total Segment Revenues
1,208,540 930,066 599,002 3,400,899 3,223,204
Segment Expenses
Allocation to Carry Pool 241,397 145,512 107,514 582,949 581,206
Compensation and benefits 95,945 92,229 76,001 343,772 272,811
Equity-based Charges 30,128 31,227 15,198 114,709 62,877
Occupancy and Related Charges 14,264 15,674 13,763 56,327 55,068
Other Operating Expenses 65,342 60,884 52,799 215,883 176,205
Total Segment Expenses 447,076 345,526 265,275 1,313,640 1,148,167
Income (Loss) attributable to noncontrolling interests 1,943 2,020 1,245 6,387 7,043
Economic Net Income (Loss) After Equity-based Charges $ 759,521 $ 582,520 $ 332,482 $ 2,080,872 $ 2,067,994
Provision for Income Taxes 16,048 11,950 10,632 61,601 102,420
Economic Net Income (Loss),
After Taxes and Equity-based Charges $ 743,473 $ 570,570 $ 321,850 $ 2,019,271 $ 1,965,574
Economic Net Income (Loss),
After Taxes and Equity-based Charges Per Adjusted Unit $ 1.04 $ 0.80 $ 0.46 $ 2.82 $ 2.81
Weighted Average Adjusted Units (Fully Diluted Basis) 716,807,180 715,781,663 704,805,537 714,835,941 699,988,443
Return on Equity 27.4 % 31.0 %
KKR
STATEMENTS OF OPERATIONS AND OTHER SELECTED FINANCIAL INFORMATION
PRIVATE MARKETS SEGMENTS (UNAUDITED)
(Amounts in thousands)
Quarter Ended Year Ended
December 31, 2013 September 30, 2013 December 31, 2012 December 31, 2013 December 31, 2012
Fees
Management and incentive fees:
Management fees $ 118,781 $ 119,410 $ 104,804 $ 459,496 $ 423,921
Incentive fees - - - - -
Management and incentive fees 118,781 119,410 104,804 459,496 423,921
Monitoring and transaction fees:
Monitoring fees 26,282 33,010 32,988 120,267 116,565
Transaction fees 53,507 54,968 41,231 150,118 96,454
Fee credits (39,509 ) (46,597 ) (37,721 ) (136,662 ) (97,362 )
Net monitoring and transaction fees 40,280 41,381 36,498 133,723 115,657
Total fees 159,061 160,791 141,302 593,219 539,578
Expenses
Compensation and benefits 66,994 65,400 53,383 231,911 192,765
Occupancy and related charges 12,110 13,367 12,075 48,045 48,562
Other operating expenses 49,466 37,586 43,463 154,982 147,253
Total expenses 128,570 116,353 108,921 434,938 388,580
Fee Related Earnings 30,491 44,438 32,381 158,281 150,998
Investment income (loss)
Realized carried interest 250,500 81,532 168,320 690,027 475,707
Unrealized carried interest 330,113 263,982 86,976 692,085 917,048
Gross carried interest 580,613 345,514 255,296 1,382,112 1,392,755
Less: allocation to KKR carry pool (234,547 ) (139,903 ) (102,058 ) (558,014 ) (565,543 )
Less: management fee refunds (8,564 ) (7,767 ) (8,712 ) (30,282 ) (143,723 )
Net carried interest 337,502 197,844 144,526 793,816 683,489
Realized other investment income (loss) - - - - -
Unrealized other investment income (loss) 824 3,357 1,158 1,897 599
Total other investment income (loss) 824 3,357 1,158 1,897 599
Total investment income (loss) 338,326 201,201 145,684 795,713 684,088
Income (Loss) before noncontrolling interests
in Income of consolidated entities 368,817 245,639 178,065 953,994 835,086
Income (Loss) attributable to
noncontrolling interests 256 433 292 1,498 3,390
Economic Net Income (Loss) $ 368,561 $ 245,206 $ 177,773 $ 952,496 $ 831,696
Assets Under Management $ 61,242,900 $ 59,678,300 $ 49,127,600 $ 61,242,900 $ 49,127,600
Fee Paying Assets Under Management $ 50,156,300 $ 49,889,500 $ 41,173,000 $ 50,156,300 $ 41,173,000
Committed Dollars Invested $ 2,122,600 $ 1,805,800 $ 1,220,800 $ 5,840,900 $ 3,026,300
Uncalled Commitments $ 20,101,600 $ 21,103,800 $ 14,271,100 $ 20,101,600 $ 14,271,100
KKR
STATEMENTS OF OPERATIONS AND OTHER SELECTED FINANCIAL INFORMATION
PUBLIC MARKETS SEGMENTS (UNAUDITED)
(Amounts in thousands)
Quarter Ended Year Ended
December 31, 2013 September 30, 2013 December 31, 2012 December 31, 2013 December 31, 2012
Fees
Management and incentive fees:
Management fees $ 56,465 $ 53,835 $ 39,551 $ 206,134 $ 105,186
Incentive fees 36,695 1,225 12,350 72,359 43,845
Management and incentive fees
93,160 55,060 51,901 278,493 149,031
Monitoring and transaction fees:
Monitoring fees - - - - -
Transaction fees 9,431 20,534 1,974 40,314 14,495
Fee credits (7,505 ) (15,185 ) (270 ) (29,950 ) (8,368 )
Net monitoring and transaction fees 1,926 5,349 1,704 10,364 6,127
Total fees 95,086 60,409 53,605 288,857 155,158
Expenses
Compensation and benefits 17,082 18,606 16,097 77,378 50,705
Occupancy and related charges 1,800 1,906 1,479 6,863 5,606
Other operating expenses (a) 12,567 19,670 6,596 49,210 18,350
Total expenses 31,449 40,182 24,172 133,451 74,661
Fee Related Earnings (a) 63,637 20,227 29,433 155,406 80,497
Investment income (loss)
Realized carried interest - - - - -
Unrealized carried interest 17,126 14,022 13,640 62,338 39,155
Gross carried interest 17,126 14,022 13,640 62,338 39,155
Less: allocation to KKR carry pool (6,850 ) (5,609 ) (5,456 ) (24,935 ) (15,663 )
Less: management fee refunds - - - - -
Net carried interest 10,276 8,413 8,184 37,403 23,492
Realized other investment income (loss) - - - - -
Unrealized other investment income (loss) 36 (4 ) 30 116 20
Total other investment income (loss) 36 (4 ) 30 116 20
Total investment income (loss) 10,312 8,409 8,214 37,519 23,512
Income (Loss) before noncontrolling interests
in Income of consolidated entities 73,949 28,636 37,647 192,925 104,009
Income (Loss) attributable to
noncontrolling interests 625 202 292 1,560 1,079
Economic Net Income (Loss) $ 73,324 $ 28,434 $ 37,355 $ 191,365 $ 102,930
Assets Under Management $ 33,077,400 $ 30,490,900 $ 26,399,900 $ 33,077,400 $ 26,399,900
Fee Paying Assets Under Management $ 27,241,200 $ 23,722,400 $ 19,673,000 $ 27,241,200 $ 19,673,000
Committed Dollars Invested $ 690,900 $ 326,400 $ 226,400 $ 1,553,000 $ 784,800
Uncalled Commitments $ 2,362,300 $ 1,614,600 $ 1,800,800 $ 2,362,300 $ 1,800,800
Gross Dollars Invested $ 1,481,100 $ 1,498,000 $ 365,600 $ 4,213,300 $ 1,678,700
(a) For the quarter ended September 30, 2013 and for the year ended December 31, 2013, other operating expenses include $9.7 million of one-time expenses incurred in connection with the launch of a closed-end fund.
KKR
STATEMENTS OF OPERATIONS AND OTHER SELECTED FINANCIAL INFORMATION
CAPITAL MARKETS AND PRINCIPAL ACTIVITIES SEGMENTS (UNAUDITED)
(Amounts in thousands)
Quarter Ended Year Ended
December 31, 2013 September 30, 2013 December 31, 2012 December 31, 2013 December 31, 2012
Fees
Management and incentive fees:
Management fees $ - $ - $ - $ - $ -
Incentive fees - - - - -
Management and incentive fees - - - - -
Monitoring and transaction fees:
Monitoring fees - - - - -
Transaction fees 41,537 53,625 33,635 146,254 129,159
Fee credits - - - - -
Net monitoring and transaction fees 41,537 53,625 33,635 146,254 129,159
Total fees 41,537 53,625 33,635 146,254 129,159
Expenses
Compensation and benefits 11,869 8,223 6,521 34,483 29,341
Occupancy and related charges 354 401 209 1,419 900
Other operating expenses 3,309 3,628 2,740 11,691 10,602
Total expenses 15,532 12,252 9,470 47,593 40,843
Fee Related Earnings 26,005 41,373 24,165 98,661 88,316
Investment income (loss)
Realized carried interest - - - - -
Unrealized carried interest - - - - -
Gross carried interest - - - - -
Less: allocation to KKR carry pool - - - - -
Less: management fee refunds - - - - -
Net carried interest - - - - -
Realized other investment income (loss) 250,856 102,766 366,878 657,139 866,776
Unrealized other investment income (loss) 71,965 197,353 (257,830 ) 299,249 243,727
Total other investment income (loss) (a) 322,821 300,119 109,048 956,388 1,110,503
Total investment income (loss) 322,821 300,119 109,048 956,388 1,110,503
Income (Loss) before noncontrolling interests
in Income of consolidated entities 348,826 341,492 133,213 1,055,049 1,198,819
Income (Loss) attributable to
noncontrolling interests 1,062 1,385 661 3,329 2,574
Economic Net Income (Loss) $ 347,764 $ 340,107 $ 132,552 $ 1,051,720 $ 1,196,245
Syndicated Capital $ 130,000 $ 716,500 $ 268,500 $ 1,112,100 $ 543,800
(a) Amount is net of (i) interest expense and (ii) certain compensation and general and administrative expenses incurred in the generation of net realized principal investment income that is not included in “Compensation and benefits” and “Other operating expenses” above and on both page 6 and page 7.
...
KKR
BALANCE SHEETS
TOTAL REPORTABLE SEGMENTS (UNAUDITED)
(Amounts in thousands, except per unit amounts)
As of December 31, 2013
Capital
Markets and
Private Public Principal Total
Markets Markets Activities Reportable
Segment Segment Segment Segments
Cash and short-term investments $ 177,547 $ 19,571 $ 1,963,979 $ 2,161,097
Investments - - 4,980,265 (a) 4,980,265
Unrealized carry 1,116,996 62,342 - 1,179,338
Other assets 305,890 278,978 77,489 662,357
Total assets $ 1,600,433 $ 360,891 $ 7,021,733 $ 8,983,057
Debt obligations $ - $ - $ 1,000,000 $ 1,000,000
Other liabilities 77,374 18,622 53,200 149,196
Total liabilities 77,374 18,622 1,053,200 1,149,196
Noncontrolling interests 1,302 1,071 68,888 71,261
Book value $ 1,521,757 $ 341,198 $ 5,899,645 $ 7,762,600
Book value per adjusted unit $ 10.83
As of December 31, 2012
Capital
Markets and
Private Public Principal Total
Markets Markets Activities Reportable
Segment Segment Segment Segments
Cash and short-term investments $ 358,237 $ 28,690 $ 1,147,360 $ 1,534,287
Investments - - 4,758,157 4,758,157
Unrealized carry 730,292 24,939 - 755,231
Other assets 207,047 280,472 62,119 549,638
Total assets $ 1,295,576 $ 334,101 $ 5,967,636 $ 7,597,313
Debt obligations $ - $ - $ 500,000 $ 500,000
Other liabilities 78,724 16,433 24,275 119,432
Total liabilities 78,724 16,433 524,275 619,432
Noncontrolling interests 1,339 739 18,619 20,697
Book value $ 1,215,513 $ 316,929 $ 5,424,742 $ 6,957,184
Book value per adjusted unit $ 9.87
(a) See Capital Markets and Principal Activities segment schedule of investments that follows.
KKR
CAPITAL MARKETS AND PRINCIPAL ACTIVITIES SEGMENT SCHEDULE OF INVESTMENTS (UNAUDITED)
(Amounts in thousands, except percentage amounts)
As of December 31, 2013
Investment Cost Fair
Value
Fair Value as
a Percentage
of Investments
Co-investments in Portfolio Companies of
Private Equity Investment Vehicles $ 1,544,331 $ 2,130,058 42.8 %
Private Equity Investment Vehicles
KKR 2006 Fund L.P. 330,066 389,879 7.8 %
KKR European Fund III L.P. 244,292 312,279 6.3 %
KKR North America Fund XI L.P. 96,340 106,079 2.1 %
KKR Asian Fund L.P. 89,978 101,380 2.0 %
KKR European Fund II L.P. 39,013 43,052 0.9 %
KKR Millenium Fund L.P. 47,430 39,793 0.8 %
KKR E2 Investors, L.P. 14,209 27,707 0.6 %
Co-Investments 16,249 17,064 0.3 %
KKR China Growth Fund L.P. 3,452 4,303 0.1 %
KKR European Fund L.P. 47,664 4,273 0.1 %
KKR Asian Fund II L.P. 2,624 2,563 0.1 %
931,317 1,048,372 21.1 %
Private Equity Total 2,475,648 3,178,430 63.9 %
Real Assets
Energy Income and Growth 207,661 211,301 4.2 %
Real Estate Fund 79,363 108,487 2.2 %
Infrastructure Fund 36,778 38,420 0.8 %
Co-Investments 11,241 13,117 0.3 %
Natural Resources 12,842 8,147 0.2 %
Real Assets Total 347,885 379,472 7.7 %
Private Markets Total 2,823,533 3,557,902 71.6 %
Public Markets Investment Vehicles
Liquid Credit 187,262 198,784 4.0 %
Special Situations 125,795 138,881 2.8 %
Credit Relative Value 122,000 136,643 2.7 %
Long/Short Equities 100,000 121,098 2.4 %
Direct Lending 56,720 63,163 1.3 %
Mezzanine Fund 20,380 24,659 0.5 %
Public Markets Total 612,157 683,228 13.7 %
Other 715,477 739,135 14.7 %
Total Investments $ 4,151,167 $ 4,980,265 100.0 %
Significant Aggregate Investments: (a)
Alliance Boots GmbH $ 228,769 $ 640,717 12.9 %
HCA Inc. 70,117 287,324 5.8 %
First Data Corporation 327,211 265,062 5.3 %
626,097 1,193,103 24.0 %
Other investments 3,525,070 3,787,162 76.0 %
Total Investments $ 4,151,167 $ 4,980,265 100.0 %
(a) The significant aggregate investments include investments in portfolio companies with individual fair values of 5% or more of the Capital Markets and Principal Activities segment investments balance as of December 31, 2013. The fair value figures include the co-investment and the limited partner and/or general partner interests in the underlying portfolio company.
KKR
ASSETS UNDER MANAGEMENT* (UNAUDITED)
(Amounts in thousands)
Private
Markets
Segment
Public
Markets
Segment
Total
Reportable
Segments
Quarter Ended December 31, 2013
September 30, 2013 $ 59,678,300 $ 30,490,900 $ 90,169,200
New Capital Raised 1,294,100 2,523,800 3,817,900
Distributions (3,088,900 ) (735,100 ) (b) (3,824,000 )
Foreign Exchange 10,700 - 10,700
Change in Value 3,348,700 797,800 4,146,500
December 31, 2013 $ 61,242,900 $ 33,077,400 $ 94,320,300
Year Ended December 31, 2013
December 31, 2012 $ 49,127,600 $ 26,399,900 $ 75,527,500
New Capital Raised 13,613,100 7,580,400 21,193,500
Distributions (9,197,900 ) (2,687,600 ) (c) (11,885,500 )
Net Changes in Fee Base of Certain Funds (a) (272,300 ) - (272,300 )
Foreign Exchange 32,800 - 32,800
Change in Value 7,939,600 1,784,700 9,724,300
December 31, 2013 $ 61,242,900 $ 33,077,400 $ 94,320,300
KKR
FEE PAYING ASSETS UNDER MANAGEMENT* (UNAUDITED)
(Amounts in thousands)
Private
Markets
Segment
Public
Markets
Segment
Total
Reportable
Segments
Quarter Ended December 31, 2013
September 30, 2013 $ 49,889,500 $ 23,722,400 $ 73,611,900
New Capital Raised 1,469,800 3,473,700 4,943,500
Distributions (1,327,000 ) (591,100 ) (b) (1,918,100 )
Foreign Exchange 65,300 - 65,300
Change in Value 58,700 636,200 694,900
December 31, 2013 $ 50,156,300 $ 27,241,200 $ 77,397,500
Year Ended December 31, 2013
December 31, 2012 $ 41,173,000 $ 19,673,000 $ 60,846,000
New Capital Raised 13,200,600 7,927,500 21,128,100
Distributions (3,860,800 ) (1,875,900 ) (c) (5,736,700 )
Net Changes in Fee Base of Certain Funds (a) (654,700 ) - (654,700 )
Foreign Exchange 172,700 - 172,700
Change in Value 125,500 1,516,600 1,642,100
December 31, 2013 $ 50,156,300 $ 27,241,200 $ 77,397,500
* Exclude those assets managed by entities where KKR holds less than a 50% ownership interest.
(a) Represents the impact of certain funds entering the post-investment period.
(b) Includes $327.3 million of redemptions by fund investors.
(c) Includes $1,021.8 million of redemptions by fund investors.
KKR
INVESTMENT VEHICLE SUMMARY (a) (UNAUDITED)
As of December 31, 2013
(Amounts in millions, except percentages)
Investment Period Amount
Percentage
Committed
Commencement Uncalled by General Remaining Remaining Fair
Date End Date Commitment Commitments Partner Invested Realized Cost Value
Private Markets
Private Equity Funds
Asian Fund II 4/2013 4/2019 $ 5,825.0 $ 5,615.1 1.3% $ 209.9 $ - $ 209.9 $ 201.1
North America Fund XI 9/2012 9/2018 8,718.4 5,903.3 2.9% 2,815.1 3.9 2,815.1 3,079.3
China Growth Fund 11/2010 11/2016 1,010.0 674.5 1.0% 335.5 32.6 318.0 399.9
E2 Investors (Annex Fund) 8/2009 11/2013 209.5 13.6 4.5% 195.9 - 195.9 426.3
European Fund III 3/2008 3/2014 6,241.1 1,689.4 4.6% 4,551.7 653.5 4,194.4 5,660.0
Asian Fund 7/2007 4/2013 3,983.3 134.1 2.5% 3,849.2 1,693.6 2,979.1 5,128.3
2006 Fund 9/2006 9/2012 17,642.2 1,205.4 2.1% 16,436.8 11,719.7 9,770.5 15,094.9
European Fund II 11/2005 10/2008 5,750.8 - 2.1% 5,750.8 4,513.2 2,220.4 3,960.0
Millennium Fund 12/2002 12/2008 6,000.0 - 2.5% 6,000.0 10,119.1 1,837.9 3,181.2
European Fund 12/1999 12/2005 3,085.4 - 3.2% 3,085.4 8,720.0 - 51.6
Total Private Equity Funds 58,465.7 15,235.4 43,230.3 37,455.6 24,541.2 37,182.6
Co-Investment Vehicles Various Various 3,166.3 974.5 Various 2,191.8 2,418.8 1,583.3 2,044.3
Total Private Equity 61,632.0 16,209.9 45,422.1 39,874.4 26,124.5 39,226.9
Real Assets
Energy Income and Growth Fund 9/2013 9/2018 1,413.5 1,269.4 17.9% 144.1 6.1 137.6 140.7
Natural Resources Fund Various Various 876.1 303.1 Various 573.0 73.2 519.4 327.8
Global Energy Opportunities Various Various 861.0 716.6 Various 144.4 0.7 144.4 132.3
Infrastructure Fund Various Various 1,042.4 388.6 4.8% 653.8 24.3 653.8 710.3
Infrastructure Co-Investments Various Various 1,356.0 251.5 Various 1,104.5 226.8 1,104.5 1,319.5
Real Estate Partners Americas 5/2013 12/2016 1,229.1 962.5 16% 266.6 - 266.6 368.4
Real Assets 6,778.1 3,891.7 2,886.4 331.1 2,826.3 2,999.0
Private Markets Total 68,410.1 20,101.6 48,308.5 40,205.5 28,950.8 42,225.9
Public Markets
Special Situations Vehicles Various Various 3,519.1 1,703.7 Various 1,815.4 729.2 1,452.7 1,660.7
Mezzanine Fund 3/2010 8/2015 987.0 464.1 4.6% 522.9 146.6 464.9 545.3
Direct Lending Vehicles Various Various 748.8 194.5 Various 554.3 27.3 554.3 596.6
Public Markets Total 5,254.9 2,362.3 2,892.6 903.1 2,471.9 2,802.6
Grand Total $ 73,665.0 $ 22,463.9 $ 51,201.1 $ 41,108.6 $ 31,422.7 $ 45,028.5
(a) Reflects investment vehicles for which KKR has the ability to earn carried interest.
KKR
DISTRIBUTION CALCULATION (UNAUDITED)
(Amounts in thousands, except unit and per unit amounts)
Quarter Ended
Year Ended
December 31, 2013 September 30, 2013 December 31, 2012 December 31, 2013 December 31, 2012
Cash Revenues
Fees $ 295,684 $ 274,825 $ 228,542 $ 1,028,330 $ 823,895
Realized cash carry 250,500 81,532 168,320 690,027 475,707
Net realized principal investment income 250,856 102,766 366,878 657,139 866,776
Total Cash Revenue 797,040 459,123 763,740 2,375,496 2,166,378
Cash Expenses
Realized cash carry allocated to carry pool 100,200 32,613 67,328 276,011 190,283
Compensation and benefits 95,945 92,229 76,001 343,772 272,811
Occupancy and related charges 14,264 15,674 13,763 56,327 55,068
Other operating expenses 65,342 60,884 52,799 215,883 176,205
Total Cash Expenses 275,751 201,400 209,891 891,993 694,367
Cash income (loss) before noncontrolling interests and local taxes 521,289 257,723 553,849 1,483,503 1,472,011
Less: local income taxes (8,995 ) (4,566 ) (6,314 ) (21,238 ) (15,572 )
Less: noncontrolling interests (1,943 ) (2,020 ) (1,245 ) (6,387 ) (7,043 )
Total distributable earnings 510,351 251,137 546,290 1,455,878 1,449,396
Less: estimated current corporate income taxes (26,809 ) (30,140 ) (23,078 ) (98,814 ) (66,733 )
Distributable Earnings, net of taxes 483,542 220,997 523,212 1,357,064 1,382,663
Less: Undistributed net realized principal investment income (150,514 ) (61,660 ) (44,497 ) (394,285 ) (544,395 )
Distributed Earnings $ 333,028 $ 159,337 $ 478,715 $ 962,779 $ 838,268
Distribution per KKR & Co. L.P. common unit $ 0.48 $ 0.23 $ 0.70 $ 1.40 $ 1.22
Components of Distribution per KKR & Co. L.P. common unit
After-tax FRE $ 0.12 $ 0.10 $ 0.08 $ 0.42 $ 0.32
Realized Cash Carry $ 0.22 $ 0.07 $ 0.15 $ 0.60 $ 0.43
Distributed Net Realized Principal Investment Income $ 0.14 $ 0.06 $ 0.47 $ 0.38 $ 0.47
Adjusted Units (Reduced for Unvested Common Units) 692,512,345 689,795,274 685,916,967
Payout Ratio 68.9 % 72.1 % 91.5 % 70.9 % 60.6 %
DISTRIBUTION POLICY
KKR intends to make quarterly cash distributions in amounts that in the aggregate are expected to constitute substantially all of the cash earnings of its investment management business and 40% of the net cash income from realized principal investments, in each case in excess of amounts determined by KKR to be necessary or appropriate to provide for the conduct of its business, to make appropriate investments in its business and its investment funds and to comply with applicable law and any of its debt instruments or other obligations. For purposes of KKR’s distribution policy, its distributions are expected to consist of (i) FRE, (ii) carry distributions received from KKR’s investment funds which have not been allocated as part of its carry pool and (iii) a percentage of net realized principal investment income. This amount is expected to be reduced by (i) corporate and applicable local taxes, if any, (ii) non-controlling interests, and (iii) amounts determined by KKR to be necessary or appropriate for the conduct of its business and other matters as discussed above.
The declaration and payment of any distributions are subject to the discretion of the board of directors of the general partner of KKR & Co. L.P., which may change the distribution policy at any time, and the terms of its limited partnership agreement. There can be no assurance that distributions will be made as intended or at all or that unitholders will receive sufficient distributions to satisfy payment of their tax liabilities as limited partners of KKR & Co. L.P. When KKR & Co. L.P. receives distributions from the KKR Group Partnerships (the holding companies of the KKR business), KKR Holdings receives its pro rata share of such distributions from the KKR Group Partnerships.
KKR
Notes to Reportable Segments (Unaudited)
The segment key performance measures that follow are used by management in making operating and resource deployment decisions as well as assessing the overall performance of each of KKR’s reportable business segments. The reportable segments for KKR’s business are presented prior to giving effect to the allocation of income (loss) between KKR & Co. L.P. and KKR Holdings L.P. and as such represent the business in total. In addition, KKR’s reportable segments are presented without giving effect to the consolidation of the funds that KKR manages.
KKR discloses the following financial measures in this earnings release that are calculated and presented using methodologies other than in accordance with GAAP. We believe that providing these performance measures on a supplemental basis to our GAAP results is helpful to unitholders in assessing the overall performance of KKR’s businesses. These financial measures should not be considered as a substitute for similar financial measures calculated in accordance with GAAP. We caution readers that these non-GAAP financial measures may differ from the calculations of other investment managers, and as a result, may not be comparable to similar measures presented by other investment managers. Reconciliations of these non-GAAP financial measures to the most directly comparable financial measures calculated and presented in accordance with GAAP are included elsewhere within this earnings release.
Fee related earnings (“FRE”) is comprised of segment fees less segment expenses (other than certain compensation and general and administrative expenses incurred in the generation of net realized principal investment income). This measure is used by management as an alternative measurement of the operating earnings of KKR and its business segments before investment income. We believe this measure is useful to unitholders as it provides additional insight into the operating profitability of our fee generating management companies and capital markets businesses. The components of FRE on a segment basis differ from the equivalent GAAP amounts on a consolidated basis as a result of: (i) the inclusion of management fees earned from consolidated funds that were eliminated in consolidation; (ii) the exclusion of fees and expenses of certain consolidated entities; (iii) the exclusion of charges relating to the amortization of intangible assets; (iv) the exclusion of charges relating to carry pool allocations; (v) the exclusion of non-cash equity charges and other non-cash compensation charges borne by KKR Holdings or incurred under the KKR & Co. L.P. 2010 Equity Incentive Plan; (vi) the exclusion of certain reimbursable expenses; and (vii) the exclusion of certain non-recurring items.
Economic net income (loss) (“ENI”) is a measure of profitability for KKR’s reportable segments and is used by management as an alternative measurement of the operating and investment earnings of KKR and its business segments. We believe this measure is useful to unitholders as it provides additional insight into the overall profitability of KKR’s businesses inclusive of investment income and carried interest. ENI is comprised of: (i) FRE plus (ii) segment investment income (loss), which is reduced for carry pool allocations, management fee refunds, interest expense and certain compensation and general and administrative expenses incurred in the generation of net realized principal investment income; less (iii) certain economic interests in KKR’s segments held by third parties. ENI differs from net income (loss) on a GAAP basis as a result of: (i) the exclusion of the items referred to in FRE above; (ii) the exclusion of investment income (loss) relating to noncontrolling interests; and (iii) the exclusion of income taxes.
Net realized principal investment income refers to net cash income from (i) realized investment gains and losses excluding certain realized investment losses from principal investments during the second quarter of 2013 to the extent unrealized losses on these investments were recognized prior to the combination with KPE on October 1, 2009, (ii) dividend income and (iii) interest income net of interest expense less certain compensation and general and administrative expenses incurred in the generation of net realized principal investment income in each case generated by KKR’s principal investments held on or through KKR’s balance sheet in our Capital Markets and Principal Activities segment. This is a term to describe a portion of KKR’s quarterly distribution.
Total distributable earnings is the sum of (i) FRE, (ii) carry distributions received from KKR’s investment funds which have not been allocated as part of its carry pool and (iii) net realized principal investment income; less (i) applicable local income taxes, if any, and (ii) noncontrolling interests. We believe this measure is useful to unitholders as it provides a supplemental measure to assess performance, excluding the impact of mark-to-market gains (losses), and also assess amounts available for distribution to KKR unitholders. However, total distributable earnings is not a measure that calculates actual distributions under KKR’s current distribution policy.
Assets under management (“AUM”) represent the assets from which KKR is entitled to receive fees or a carried interest and general partner capital. We believe this measure is useful to unitholders as it provides additional insight into KKR’s capital raising activities and the overall activity in its investment funds and vehicles. KKR calculates the amount of AUM as of any date as the sum of: (i) the fair value of the investments of KKR’s investment funds plus uncalled capital commitments from these funds; (ii) the fair value of investments in KKR’s co-investment vehicles; (iii) the net asset value of certain of KKR's fixed income products; (iv) the value of outstanding structured finance vehicles; and (v) the fair value of other assets managed by KKR. KKR’s definition of AUM is not based on any definition of AUM that may be set forth in the agreements governing the investment funds, vehicles or accounts that it manages or calculated pursuant to any regulatory definitions.
Fee paying AUM (“FPAUM”) represents only those assets under management from which KKR receives fees. We believe this measure is useful to unitholders as it provides additional insight into the capital base upon which KKR earns management fees. This relates to KKR’s capital raising activities and the overall activity in its investment funds and vehicles, for only those funds and vehicles where KKR receives fees (i.e., excluding vehicles that receive only carried interest or general partner capital). FPAUM is the sum of all of the individual fee bases that are used to calculate KKR’s fees and differs from AUM in the following respects: (i) assets from which KKR does not receive a fee are excluded (i.e., assets with respect to which it receives only carried interest) and (ii) certain assets, primarily in its private equity funds, are reflected based on capital commitments and invested capital as opposed to fair value because fees are not impacted by changes in the fair value of underlying investments.
Committed dollars invested is the aggregate amount of capital commitments that have been invested by KKR’s investment funds and carry-yielding co-investment vehicles and is used as a measure of investment activity for KKR and its business segments during a given period. We believe this measure is useful to unitholders as it provides additional insight into KKR’s investment of committed capital. Such amounts include: (i) capital invested by fund investors and co-investors with respect to which KKR is entitled to a fee or carried interest and (ii) capital invested by KKR’s investment funds and vehicles.
Gross dollars invested is the aggregate amount of capital that has been invested by all of KAM’s investment vehicles in our private credit non-liquid strategies and is used as a measure of investment activity for KAM in a given period. We believe this measure is useful to unitholders as it provides additional insight into KAM’s investment of capital across its private credit non-liquid strategies for all the investment vehicles which it manages. Such amounts include: (i) capital invested by fund investors and co-investors with respect to which KAM is entitled to a fee or carried interest and (ii) internal and proprietary capital invested by KAM’s investment funds and vehicles.
Syndicated capital is generally the aggregate amount of capital in transactions originated by KKR investment funds and carry-yielding co-investment vehicles, which has been distributed to third parties in exchange for a fee. It does not include (i) capital invested in such transactions by KKR investment funds and carry-yielding co-investment vehicles, which is instead reported in committed dollars invested and (ii) debt capital that is arranged as part of the acquisition financing of transactions originated by KKR investment funds and vehicles. Syndicated capital is used as a measure of investment activity for KKR and its business segments during a given period, and we believe that this measure is useful to unitholders as it provides additional insight into levels of syndication activity in KKR’s Capital Markets and Principal Activities segment and across its investment platform.
Uncalled commitments are used as a measure of unfunded capital commitments that KKR’s investment funds and carry-paying co-investment vehicles have received from partners to contribute capital to fund future investments. We believe this measure is useful to unitholders as it provides additional insight into the amount of capital that is available to KKR’s investment funds and vehicles to make future investments.
Adjusted units are used as a measure of the total equity ownership of KKR that is held by KKR & Co. L.P. and KKR Holdings and represent the fully diluted unit count using the if-converted method. We believe this measure is useful to unitholders as it provides an indication of the total equity ownership of KKR as if all outstanding KKR Holdings units had been exchanged for common units of KKR & Co. L.P.
Core interest expense is used by management as an alternative measurement of interest expense incurred by KKR on a segment basis and excludes interest expense related to debt obligations from investment financing arrangements related to certain of KKR’s private equity funds, investment vehicles and principal investments. These financing arrangements are not direct obligations of the general partners of KKR’s private equity funds or its management companies. On a segment basis, interest expense is included in other investment income. We believe this measure is useful to unitholders as it provides an indication of the amount of interest expense borne by KKR excluding interest expense that is allocated to KKR’s investment funds and vehicles and other noncontrolling interest holders. Additionally, we believe this measure is useful for analyzing KKR’s ability to service its debt obligations.
Book value is a measure of the net assets of KKR’s reportable segments and is used by management primarily in assessing the unrealized value of KKR’s investment portfolio, including carried interest, as well as KKR’s overall liquidity position. We believe this measure is useful to unitholders as it provides additional insight into the assets and liabilities of KKR excluding the assets and liabilities that are allocated to noncontrolling interest holders. Book value differs from KKR & Co. L.P. Partners’ Capital on a GAAP basis primarily as a result of the exclusion of ownership interests attributable to KKR Holdings.
Fee related EBITDA is comprised of FRE before the impact of depreciation of fixed assets and amortization of intangible assets and is used by management as a measure of the cash earnings of KKR and its business segments before investment income. We believe this measure is useful to unitholders as it provides additional insight into the amount of cash earnings generated by KKR’s management companies and capital markets businesses.
Cash and short-term investments represent cash and liquid short-term investments in high-grade, short-duration cash management strategies used by KKR to generate additional yield on our excess liquidity and is used by management in evaluating KKR’s liquidity position. We believe this measure is useful to unitholders as it provides additional insight into KKR’s available liquidity. Cash and short-term investments differ from cash and cash equivalents on a GAAP basis as a result of the inclusion of liquid short-term investments in cash and short-term investments.
KKR
EXHIBIT A
RECONCILIATION OF NET INCOME (LOSS) ATTRIBUTABLE TO KKR & CO. L.P. PER COMMON UNIT (GAAP BASIS)
TO ENI AFTER TAXES PER ADJUSTED UNIT (UNAUDITED)
(Amounts in thousands, except common unit and per common unit amounts)
Quarter Ended
December 31, 2013 September 30, 2013 December 31, 2012
Net income (loss) attributable to KKR & Co. L.P. per common unit - Basic $ 0.96 $ 0.73 $ 0.39
Weighted Average Common Units Outstanding - Basic 288,045,501 282,148,802 249,303,558
Net income (loss) attributable to KKR & Co. L.P. 277,913 204,740 96,728
Plus: Net income (loss) attributable to noncontrolling
interests held by KKR Holdings L.P.
393,739 300,169 170,256
Plus: Non-cash equity based charges 60,331 85,215 70,170
Plus: Amortization of intangibles and other, net 45,265 15,979 4,898
Plus: Income taxes 12,401 7,644 5,628
Economic net income (loss) 789,649 613,747 347,680
Less: Equity-based charges associated with the KKR & Co. L.P. 2010 equity incentive plan 30,128 31,227 15,198
Economic net income (loss) after equity-based charges 759,521 582,520 332,482
Less: Provision for income taxes 16,048 11,950 10,632
Economic net income (loss) after taxes and equity-based charges 743,473 570,570 321,850
Plus: Equity-based charges associated with the KKR & Co. L.P. 2010 equity incentive plan 30,128 31,227 15,198
Economic net income (loss) after taxes 773,601 601,797 337,048
Weighted Average Adjusted Units 716,807,180 715,781,663 704,805,537
Economic net income (loss) after taxes per adjusted unit 1.08 0.84 0.48
Weighted Average Adjusted Units 716,807,180 715,781,663 704,805,537
Economic net income (loss) after taxes 773,601 601,797 337,048
Less: Equity-based charges associated with the KKR & Co. L.P. 2010 equity incentive plan 30,128 31,227 15,198
Economic net income (loss) after taxes and equity-based charges 743,473 570,570 321,850
Weighted Average Adjusted Units 716,807,180 715,781,663 704,805,537
Economic net income (loss) after taxes and equity-based charges per adjusted unit $ 1.04 $ 0.80 $ 0.46
Year Ended
December 31, 2013 December 31, 2012
Net income (loss) attributable to KKR & Co. L.P. per common unit - Basic $ 2.51 $ 2.35
Weighted Average Common Units Outstanding - Basic 274,910,628 238,503,257
Net income (loss) attributable to KKR & Co. L.P. 691,226 560,836
Plus: Net income (loss) attributable to noncontrolling
interests held by KKR Holdings L.P.
1,056,126 1,116,740
Plus: Non-cash equity based charges 307,514 400,207
Plus: Amortization of intangibles and other, net 102,789 9,683
Plus: Income taxes 37,926 43,405
Economic net income (loss) 2,195,581 2,130,871
Less: Equity-based charges associated with the KKR & Co. L.P. 2010 equity incentive plan 114,709 62,877
Economic net income (loss) after equity-based charges 2,080,872 2,067,994
Less: Provision for income taxes 61,601 102,420
Economic net income (loss) after taxes and equity-based charges 2,019,271 1,965,574
Plus: Equity-based charges associated with the KKR & Co. L.P. 2010 equity incentive plan 114,709 62,877
Economic net income (loss) after taxes 2,133,980 2,028,451
Weighted Average Adjusted Units 714,835,941 699,988,443
Economic net income (loss) after taxes per adjusted unit 2.99 2.90
Weighted Average Adjusted Units 714,835,941 699,988,443
Economic net income (loss) after taxes 2,133,980 2,028,451
Less: Equity-based charges associated with the KKR & Co. L.P. 2010 equity incentive plan 114,709 62,877
Economic net income (loss) after taxes and equity-based charges 2,019,271 1,965,574
Weighted Average Adjusted Units 714,835,941 699,988,443
Economic net income (loss) after taxes and equity-based charges per adjusted unit $ 2.82 $ 2.81
KKR
EXHIBIT A (CONTINUED)
RECONCILIATION OF NET INCOME (LOSS) ATTRIBUTABLE TO KKR & CO. L.P. (GAAP BASIS)
TO ECONOMIC NET INCOME (LOSS), FEE RELATED EARNINGS, FEE RELATED EBITDA, AND TOTAL DISTRIBUTABLE EARNINGS (UNAUDITED)
(Amounts in thousands)
Quarter Ended
December 31, 2013 September 30, 2013 December 31, 2012
Net income (loss) attributable to KKR & Co. L.P. $ 277,913 $ 204,740 $ 96,728
Plus: Net income (loss) attributable to noncontrolling
interests held by KKR Holdings L.P.
393,739 300,169 170,256
Plus: Non-cash equity based charges 60,331 85,215 70,170
Plus: Amortization of intangibles and other, net 45,265 15,979 4,898
Plus: Income taxes 12,401 7,644 5,628
Economic net income (loss) 789,649 613,747 347,680
Plus: Income attributable to segment noncontrolling interests 1,943 2,020 1,245
Less: Investment income (loss) 671,459 509,729 262,946
Fee related earnings 120,133 106,038 85,979
Plus: Depreciation and amortization 3,658 3,601 3,580
Fee related EBITDA $ 123,791 $ 109,639 $ 89,559
Less: Depreciation and amortization 3,658 3,601 3,580
Plus: Realized cash carry, net of realized cash carry allocated to carry pool 150,300 48,919 100,992
Plus: Net realized principal investment income 250,856 102,766 366,878
Less: Local income taxes and noncontrolling interests 10,938 6,586 7,559
Total distributable earnings $ 510,351 $ 251,137 $ 546,290
Year Ended
December 31, 2013 December 31, 2012
Net income (loss) attributable to KKR & Co. L.P. $ 691,226 $ 560,836
Plus: Net income (loss) attributable to noncontrolling
interests held by KKR Holdings L.P.
1,056,126 1,116,740
Plus: Non-cash equity based charges 307,514 400,207
Plus: Amortization of intangibles and other, net 102,789 9,683
Plus: Income taxes 37,926 43,405
Economic net income (loss) 2,195,581 2,130,871
Plus: Income attributable to segment noncontrolling interests 6,387 7,043
Less: Investment income (loss) 1,789,620 1,818,103
Fee related earnings 412,348 319,811
Plus: Depreciation and amortization 14,648 12,499
Fee related EBITDA $ 426,996 $ 332,310
Less: Depreciation and amortization 14,648 12,499
Plus: Realized cash carry, net of realized cash carry allocated to carry pool 414,016 285,424
Plus: Net realized principal investment income 657,139 866,776
Less: Local income taxes and noncontrolling interests 27,625 22,615
Total distributable earnings $ 1,455,878 $ 1,449,396
KKR
EXHIBIT A (CONTINUED)
RECONCILIATION OF KKR & CO. L.P. PARTNERS' CAPITAL (GAAP BASIS)
TO BOOK VALUE AND BOOK VALUE PER ADJUSTED UNIT (UNAUDITED)
(Amounts in thousands, except common unit and per common unit amounts)
As of As of
December 31, 2013 December 31, 2012
KKR & Co. L.P. partners’ capital $ 2,722,010 $ 2,004,359
Noncontrolling interests held by KKR Holdings L.P. 5,116,761 4,981,864
Equity impact of KKR Management Holdings Corp. and other (76,171 ) (29,039 )
Book value 7,762,600 6,957,184
Adjusted units 716,676,699 704,780,484
Book value per adjusted unit $ 10.83 $ 9.87
RECONCILIATION OF CASH AND CASH EQUIVALENTS (GAAP BASIS)
TO CASH AND SHORT-TERM INVESTMENTS (SEGMENT BASIS) (UNAUDITED)
(Amounts in thousands)
As of As of
December 31, 2013 December 31, 2012
Cash and cash equivalents $ 1,306,383 $ 1,230,464
Liquid short-term investments 854,714 303,823
Cash and short-term investments $ 2,161,097 $ 1,534,287
KKR
EXHIBIT B
RECONCILIATION OF WEIGHTED AVERAGE GAAP COMMON UNITS OUTSTANDING TO WEIGHTED AVERAGE ADJUSTED UNITS (UNAUDITED)
The following table provides a reconciliation of KKR's Weighted Average GAAP Common Units Outstanding to Weighted Average Adjusted Units.
Quarter Ended
December 31, 2013 September 30, 2013 December 31, 2012
Weighted Average GAAP Common Units Outstanding - Basic 288,045,501 282,148,802 249,303,558
Weighted Average Unvested Common Units(a) 24,294,835 25,986,389 18,888,570
Weighted Average GAAP Common Units Outstanding - Diluted 312,340,336 308,135,191 268,192,128
Adjustments:
Weighted Average KKR Holdings Units(b) 404,466,844 407,646,472 436,613,409
Weighted Average Adjusted Units 716,807,180 715,781,663 704,805,537
Year Ended
December 31, 2013 December 31, 2012
Weighted Average GAAP Common Units Outstanding - Basic 274,910,628 238,503,257
Weighted Average Unvested Common Units(a) 25,343,462 15,589,903
Weighted Average GAAP Common Units Outstanding - Diluted 300,254,090 254,093,160
Adjustments:
Weighted Average KKR Holdings Units(b) 414,581,851 445,895,283
Weighted Average Adjusted Units 714,835,941 699,988,443
RECONCILIATION OF GAAP COMMON UNITS OUTSTANDING TO ADJUSTED UNITS (UNAUDITED)
The following table provides a reconciliation of KKR's GAAP Common Units Outstanding to Adjusted Units.
As of As of
December 31, 2013 December 31, 2012
GAAP Common Units Outstanding - Basic 288,143,327 253,363,691
Unvested Common Units(a) 24,164,354 18,863,517
GAAP Common Units Outstanding - Diluted 312,307,681 272,227,208
Adjustments:
KKR Holdings Units(b) 404,369,018 432,553,276
Adjusted Units 716,676,699 704,780,484
(a) Represents equity awards granted under the KKR & Co. L.P. 2010 Equity Incentive Plan. The issuance of common units of KKR & Co. L.P. pursuant to awards under its equity incentive plan dilutes KKR common unitholders and KKR Holdings pro rata in accordance with their respective percentage interests in the KKR business.
(b) Common units that may be issued by KKR & Co. L.P. upon exchange of units in KKR Holdings L.P. for KKR common units.
Contact:
Investor Relations:
Kohlberg Kravis Roberts & Co. L.P.
Craig Larson
+1-877-610-4910 (U.S.) / +1-212-230-9410
investor-relations@kkr.com
or
Media:
Kohlberg Kravis Roberts & Co. L.P.
Kristi Huller
+1-212-750-8300
media@kkr.com
I usually do the same before jumping in anything. This might be an exception.
Glta
Got me some Friday after watching it for over a month.
Get sum! Glta
Hello KKR ers! Very happy to have you
dumping cake on us over at WMIH! Looking forward to what KKR has in store for WMIH next!
Glta
KKR Finalizes Strategic Investment in WMI Holdings Corp.
PR Newswire WMI Holdings Corp.
16 hours ago
SEATTLE, Jan. 31, 2014 /PRNewswire/ -- WMI Holdings Corp. (WMIH) ("WMI" or the "Company") today announced that KKR Management Holdings L.P. and KKR Fund Holdings L.P., subsidiaries of KKR & Co. L.P. (together with its affiliates, "KKR"), have finalized a strategic investment in the Company.
Michael Willingham, Chairman of the Company said, "We believe the investment in our Company by KKR will enhance value for all shareholders of WMI Holdings. KKR has a history of investing across a wide range of asset classes and we look forward to working with the KKR team as we execute on our acquisition strategy."
Tagar Olson, Member and Head of KKR's Financial Services team stated, "We are pleased to finalize this investment and look forward to working with the Company as it continues to grow and diversify its platform. As a long-term aligned capital partner to the Company, we believe that KKR is well-positioned to help build shareholder value."
On January 30, 2014, KKR (i) purchased approximately $11 million face amount of convertible preferred stock of the Company convertible into shares of common stock of the Company for a conversion price of $1.10 per share, and (ii) committed to purchase up to $150 million aggregate principal amount of subordinated 7.5% PIK notes, which may be issued in one or more tranches over a three year period, each with a seven year term from the date of initial issuance (the "Subordinated Notes"), subject to certain terms and conditions. Substantially all of the proceeds from the Subordinated Notes, if and when issued, would be used by the Company to fund future acquisitions. In connection with the commitment, KKR has received five-year warrants to purchase approximately 61.4 million shares of the Company's common stock, 30.7 million of which has an exercise price of $1.32 per share and 30.7 million of which has an exercise price of $1.43 per share. KKR also has the right for three years to participate up to 50% in equity offerings up to an aggregate of $1 billion by the Company subject to certain limitations, including a cap on ownership by KKR of 42.5% of the Company's common equity.
Blackstone Advisory Partners L.P. acted as financial advisor to the Company in connection with the transaction. Akin Gump Strauss Hauer & Feld LLP and Lane Powell PC are counsel to the Company. Simpson Thacher & Bartlett LLP is counsel to KKR.
About WMI Holdings
WMI Holdings Corp., formerly Washington Mutual, Inc., consists primarily of WM Mortgage Reinsurance Company, Inc. ("WMMRC"), a wholly-owned subsidiary of the Company that is domiciled in Hawaii. The Company's primary business is a legacy reinsurance business that is currently operated in runoff mode by WMMRC.
About KKR
Founded in 1976 and led by Henry Kravis and George Roberts, KKR is a leading global investment firm with $90.2 billion in assets under management as of September 30, 2013. With offices around the world, KKR manages assets through a variety of investment funds and accounts covering multiple asset classes. KKR seeks to create value by bringing operational expertise to its portfolio companies and through active oversight and monitoring of its investments. KKR complements its investment expertise and strengthens interactions with fund investors through its client relationships and capital markets platform. KKR & Co. L.P. is publicly traded on the New York Stock Exchange (KKR) and "KKR", as used in this release, includes its subsidiaries, their managed investment funds and accounts, and/or their affiliated investment vehicles, as appropriate.
Cautionary Statement Regarding Forward-Looking Statements
This press release includes forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical fact included in this report that address activities, events, conditions or developments that we expect, believe or anticipate will or may occur in the future are forward-looking statements. Forward-looking statements give our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance and business and these statements are not guarantees of future performance. These statements can be identified by the fact that they do not relate strictly to historical or current facts. Forward-looking statements may include the words "anticipate," "estimate," "expect," "project," "intend," "plan," "believe," "strategy," "future," "opportunity," "may," "should," "will," "would," "will be," "will continue," "will likely result," and similar expressions. Such forward-looking statements involve risks and uncertainties that may cause actual events, results or performance to differ materially from those indicated by such statements. These risks are identified and discussed in the Company's Form 10-K for the year ended December 31, 2012 under Risk Factors in Part I, Item 1A. These risk factors will be important to consider in determining future results and should be reviewed in their entirety. These forward-looking statements are expressed in good faith and we believe there is a reasonable basis for them. However, there can be no assurance that the events, results or trends identified in these forward-looking statements will occur or be achieved. Forward-looking statements speak only as of the date they are made, and we do not undertake to update any forward-looking statement, except as required by law. Readers should carefully review the statements set forth in the reports, which the Company has filed or will file from time to time with the Securities and Exchange Commission.
Yep, I Finally took a position here this morning. Lets see what it does.
KKR chart points to a move into the 30's!!!
Followers
|
27
|
Posters
|
|
Posts (Today)
|
0
|
Posts (Total)
|
286
|
Created
|
03/24/11
|
Type
|
Free
|
Moderators |
Volume | |
Day Range: | |
Bid Price | |
Ask Price | |
Last Trade Time: |