KKR Private Equity Investors’ net asset value rose by USD7.4m in the first quarter of 2009, despite the difficult economic conditions.
KKR Private Equity Investors’ net asset value rose by USD7.4m in the first quarter of 2009, despite the difficult economic conditions.
As of 31 March 2009, NAV was USD2,626.1m, or USD12.82 per unit, up from USD2,618.7m, or USD12.78 per unit, the previous quarter. KPE’s total return was 0.3 per cent during the quarter.
Net unrealized appreciation on investments and foreign currency transactions was USD116.9m. Of the total net unrealized appreciation during the quarter, USD84.0m represented the reversal of previously recorded net unrealized depreciation, primarily from the sale of certain interests in co-investments and the remainder of the opportunistic investments in public equities, related derivative instruments and a fixed income investment.
Net realized loss on investments and foreign currency was USD93.9m. The net realized loss was primarily comprised of USD39.8m from the sale of certain interests in co-investments, USD37.1m from the sale of opportunistic investments, and USD28.1m from the sale of investments by SCF, offset by a realized gain of USD11.1m related to foreign currency transactions.
Net investment loss was USD15.6m, which principally represented interest expense, management fees and general and administrative expenses, offset by interest income.
George R. Roberts (pictured), co-founder of KKR and co-chairman of KPE’s managing partner’s board of directors, says: ‘We believe that our performance during the first quarter is attributable in large part to our focus on operational improvement, cost reduction and efficiency initiatives, our progress in implementing appropriate capital structures for our portfolio companies, our adherence to procedures for monitoring our investments and our work in helping our companies adapt to the changing global regulatory environment.’
Henry R. Kravis, co-founder of KKR and co-chairman of KPE’s managing partner’s board of directors, adds: ‘We remain prudently on guard in terms of the operations of our portfolio companies given the environment. The work of our company management teams, private equity industry teams, KKR Capstone team and capital markets team to improve company operations, address refinancing issues and proactively optimize capital structures allows us to, in general, lower debt to earnings ratios, cut costs, control cash flows and opportunistically access the capital markets. These initiatives contributed to the slight rise in KPE’s NAV for the first quarter.’
