The Blackstone Group has reported Economic Net Income (ENI) of USD1.389 billion for the full year 2011, slightly lower than USD1.418 billion ENI for the full year 2010.
The decline in ENI compared to the full year 2010 was driven principally by a slowing in the rate of increase in the carrying value of assets as of 31 December, 2011 across Blackstone’s investment segments, offset by an increase of USD246.5 million, or 15%, in Total Management and Advisory Fees to USD1.878 billion for the full year 2011.
ENI was USD449.9 million for the three months ended December 31, 2011, a decrease of USD62.8 million, compared to ENI of USD512.7 million for the three months ended December 31, 2010, primarily attributable to decreases in Performance Fees and Investment Income.
Driven by strong net inflows during the last year, Blackstone’s managed assets demonstrated consistent growth with Fee-Earning Assets Under Management and Total Assets Under Management rising to a record USD136.8 billion and USD166.2 billion, respectively, at December 31, 2011. The Blackstone funds had USD32.9 billion of committed but uninvested capital, or “dry powder”, at the end of 2011.
For the full year 2011, Total Segment Revenues were USD3.3 billion, up 5% from USD3.1 billion for the full year 2010 due to higher Management Fees and Performance Fees, offset by a decrease in Investment Income. Total Management Fees increased to USD1.9 billion, up 15% from USD1.6 billion for the full year 2010, principally due to the increase in Fee-Earning Assets Under Management. Performance Fees increased 27% to USD1.2 billion in 2011 driven by increases in the Real Estate segment, which more than offset decreases in the other investment segments. Investment Income was lower across all segments due to a slowing in appreciation over the prior year.
Total Segment Expenses were USD1.7 billion for the full year 2011, an increase from USD1.6 billion for the full year 2010, primarily due to an increase of USD101.5 million in Compensation, excluding Performance Fee Compensation. Compensation was up 12% to USD960.6 million for the full year 2011, principally as a result of increased investment across Blackstone supporting its continued strong growth. Blackstone’s noncompensation expenses were up 22% from full year 2010 driven mostly by professional fees, financing activities and occupancy costs related to continuing global expansion and the launch of new products.
GAAP results for the year ended December 31, 2011 included Revenues of USD3.3 billion, compared to USD3.1 billion for the full year 2010, and Net Loss Attributable to The Blackstone Group L.P. of USD269.0 million, compared to a net loss of USD370.0 million for the full year 2010. GAAP results for the fourth quarter of 2011 included Revenues of USD915.1 million, compared to USD1.1 billion for the fourth quarter of 2010, and Net Loss Attributable to The Blackstone Group L.P. of USD123.4 million, compared to a net loss of USD11.0 million for the fourth quarter of 2010.
Stephen A Schwarzman (pictured), Chairman and Chief Executive Officer, says: “Despite volatile markets and struggling economies, Blackstone had strong performance in 2011. Our investors view us as a critical partner, helping them protect and grow their capital. We again reported net inflows in every one of our businesses with record fee-earning assets under management of USD137 billion at year end, up 25% year over year. During 2011, we invested or committed over USD16 billion from our drawdown funds, which we believe will yield attractive results for our investors as well as provide capital that is critical to spurring economic growth, supporting job creation and restoring confidence in our nation’s future. We also distributed approximately USD9 billion to our drawdown fund investors during the year.”
