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Carlyle’s Real Asset Segment’s Fee-Related Earnings Rose Sharply

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Feb. 19 2018, Updated 10:32 a.m. ET

Appreciation

The Carlyle Group’s (CG) Real Asset segment’s carry funds witnessed an appreciation of 4% in 4Q17, which led to the generation of net performance fees amounting to $63 million. In 4Q17, the segment generated economic income amounting to $98 million, while in 2017, it was $215 million thanks to favorable momentum in fee-related earnings (or FRE) as well as appreciation.

In 4Q17, the Real Assets segment generated FRE amounting to $34 million, while in 4Q16 FRE was $13 million. The segment’s distributable earnings (or DE) in 4Q17 stood at $50 million, while in 2017, DE stood at $25 million.

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Total AUM and deployments

In 4Q17, the Real Assets segment witnessed deployments of $1.6 billion, and in 2017, deployments were $4.4 billion. In 4Q17, the segment’s natural resources component saw deployments of $1.1 billion.

The Real Assets segment saw a substantial 25% rise in total assets under management (or AUM) in 4Q17 on a YoY basis thanks to fundraising as well as appreciation. In 4Q17, the segment saw fundraising amounting to $3.2 billion, while in 2017, the figure was at $10.2 billion. In 4Q17, the Real Assets segment saw realizations amounting to $1.4 billion, while in 2017, the figure was $4.6 billion.

The dividend yield of Carlyle Group stood at 6.9% on an LTM (last-12-month) basis, and peers (XLF) Brookfield Asset Management (BAM), Greenhill (GHL), and KKR (KKR) have yields of 1.4%, 7.8%, and 3.2%, respectively, on an LTM basis.

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