Yahoo Finance Blackstone Inc (BX) (Q1 2024) Earnings Call Transcript Highlights: Robust Performance and ...
GAAP Net Income: $1.6 billion for the quarter.
Distributable Earnings: $1.3 billion or $0.98 per common share.
Dividend: Declared at $0.83 per share.
Inflows: $34 billion in the first quarter, $87 billion over the past two quarters.
Investments: $25 billion in Q1, $56 billion over the past two quarters.
Private Wealth Sales: Increased more than 80% from the previous quarter to $6.6 billion.
Assets Under Management (AUM): $241 billion in private wealth; overall more than $1 trillion.
Net Returns: 15% annually in corporate private equity and infrastructure; 14% in opportunistic real estate and secondaries; 12% in tactical opportunities; 10% in credit.
Data Centers Investment: $50 billion owned globally, with an additional $50 billion in prospective development.
Dry Powder: Nearly $200 billion available.
Shareholder Distributions: $4.7 billion over the past 12 months through dividends and share repurchases.
Fee-Related Earnings (FRE): $1.2 billion or $0.95 per share, highest in 6 quarters.
Management Fees: Record $1.7 billion.
Insurance Assets Under Management: Crossed $200 billion, up 20% year-over-year.
Release Date: April 18, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q & A Highlights
Q: Can you discuss the initiatives in infrastructure that can help accelerate growth, given the tremendous market opportunity? A: Jonathan D. Gray, President and COO of Blackstone, highlighted the potential in infrastructure, noting the firm's focus on transportation, energy transition, and digital infrastructure. He emphasized the unique open-ended vehicle structure that aligns with long-term capital, and the geographical expansion opportunities, particularly in Europe and Asia. Michael S. Chae, CFO, added that the growth trajectory could mirror the historical growth of the real estate business, expanding across regions and customer sets.
: With real estate deployments picking up, can you comment on where we are in the investing cycle and your perspective on returns, especially with BREIT now performing well? A: Jonathan D. Gray explained that despite challenges like remote work impacting office spaces and rising interest rates, the market has absorbed these changes. He sees this period as a time for strategic deployment in real estate, anticipating a future increase in transaction activity as markets normalize. He mentioned significant dry powder available for opportunistic investments globally.
Q: What is the vision for BXPE in terms of capacity and pace of inflows, and how do you compare its potential size to BREIT? A: Jonathan D. Gray described BXPE as a broad platform allowing scalable and flexible capital deployment across various sectors, including private equity and tactical opportunities. He emphasized the importance of disciplined capital deployment and strong performance, suggesting that BXPE has significant growth potential, potentially exceeding the scale of BREIT.
Q: How are you thinking about margins for the rest of the year given the business momentum and growth prospects? A: Michael S. Chae reiterated the message of margin stability, expecting consistent performance similar to previous quarters. He highlighted the built-in operating leverage in Blackstone's business model, which could lead to margin expansion over the long term.
Q: Can you elaborate on the bank partnerships and synthetic risk transfer trends, and how these impact your strategy? A: Jonathan D. Gray discussed Blackstone's active role in synthetic risk transfers (SRTs), particularly with banks seeking capital relief. He noted these transactions often involve taking first loss positions but are executed responsibly, leveraging Blackstone's deep credit expertise. This strategy helps banks manage capital requirements while providing Blackstone with attractive returns.
Q: Given the shift in the rate outlook to a 'for-longer' scenario, how might this impact your investment activity and areas of focus? A: Jonathan D. Gray acknowledged that a prolonged period of higher rates could extend the investment window, allowing more time for strategic deployments at favorable prices. He suggested that this environment might delay some asset realizations but overall sees it as beneficial for deploying Blackstone's significant dry powder effectively.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
