Pensions and Sovereign Funds Contribute to Massive Profits for Blackstone


Equity research firms like JMP Securities and RBC Capital have raised their price targets on The Blackstone Group L.P., after the private equity firm disclosed recent financial information. For the Blackstone Group, second quarter profit is measured as economic net income. Economic net income grew by 89% to US$ 1.3 billion since the second quarter of last year. This measure also factors in unrealized investment gains.

Blackstone’s performance fees rose dramatically, spurred by profits on investments. Last-twelve-month realized performance fees climbed to a record high of US$ 1.9 billion. By expanding into credit, real estate and hedge funds, Blackstone has been able to feed the appetite of sovereign wealth funds and pensions craving alternative assets and yield. Blackstone’s real estate business has generated lots of fees and has grown with more assets under management.

See which sovereign wealth funds and pensions have allocations with Blackstone

Blackstone Group by Selected Segments – Economic Income – Millions USD

Fiscal Period Real Estate Private Equity Hedge Fund Solutions Credit Financial Advisory
1Q Y2012 267.25 89.98 66.36 87.16 -10.48
2Q Y2012 197.14 -65.06 26.08 54.72 8.84
3Q Y2012 288.71 189.28 82.09 76.20 -3.26
4Q Y2012 246.02 198.07 82.74 107.20 51.98
1Q Y2013 352.94 103.20 93.86 98.50 -10.17
2Q Y2013 370.89 171.22 71.37 82.01 23.90
3Q Y2013 414.04 80.49 76.66 73.28 10.55
4Q Y2013 932.10 360.45 134.64 104.70 51.40
1Q Y2014 320.92 319.25 113.90 81.02 -9.84
2Q Y2014 489.37 647.74 83.11 103.75 27.03

Source: Blackstone Group – Financials – Extracted July 21, 2014

$279 Billion

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