Shares of private equity giant Carlyle Group surged by 9.7% on Thursday after the firm posted steady third-quarter profits that surpassed Wall Street expectations, with increased fee income balancing out higher compensation expenses, according to a report by Bloomberg.
The company’s stock price hit $54.23, giving a valuation of around $19.3bn, after Carlyle reported distributable earnings, or the profit available for shareholders, of $367 million, or 95 cents per share – almost matching last year’s figure but ahead of analysts’ forecast of 90 cents per share, according to LSEG data.
Carlyle, headquartered in Washington, DC, reported record fee-related earnings of $278m, a 36% year-over-year increase, with a fee-related earnings margin of 47%, up from 37% in the same quarter last year. The growth was driven by higher management and transaction fees, along with gains from asset sales, though compensation expenses also rose due to a recent pay restructure aimed at aligning compensation more closely with performance.
Assets under management climbed 17% from the prior quarter, reaching $447bn.
Carlyle’s corporate private equity funds grew 4% for the quarter, buoyed by favourable macroeconomic conditions in the US and Asia. Other segments also saw gains, with real estate funds up 2%, infrastructure and natural resources funds up 2%, and global credit funds gaining 3%.
In October, Carlyle took US aircraft maintenance provider StandardAero public in one of the largest IPOs this year, valuing the company at roughly $8bn. The firm also deployed $3.9bn in new acquisitions and has $85bn of unspent capital ready for future investments.
