Blackstone Inc. · NYSE:BX
Blackstone — Q3 2020 Earnings Presentation
40 slides from Blackstone's earnings presentation, Oct 28, 2020
Slide 1: Blackstone Reports Third Quarter 2020 Results
Blackstone Reports Third Quarter 2020 Results New York, October 28, 2020: Blackstone (NYSE:BX) today reported its third quarter 2020 results. Stephen A. Schwarzman, Chairman and Chief Executive Officer, said, “Blackstone reported excellent results in the third quarter, characterized by strong invest
Slide 2: About Blackstone and Forward-Looking Statements
live broadcast, there will be a webcast replay on the Shareholders section of Blackstone’s website at https://ir.blackstone.com/. About Blackstone Blackstone is one of the world’s leading investment firms. We seek to create positive economic impact and long- term value for our investors, the compani
Slide 3: Investor and Media Relations Contacts
This presentation does not constitute an offer of any Blackstone Fund. Investor and Media Relations Contacts Weston Tucker Christine Anderson Blackstone Blackstone Tel: +1 (212) 583-5231 Tel: +1 (212) 583-5182 tucker@blackstone.com christine.anderson@blackstone.com 3
Slide 4: Blackstone's Third Quarter 2020 Earnings
Blackstone’s Third Quarter 2020 Earnings OCTOBER 28, 2020
Slide 5: Blackstone's Third Quarter 2020 GAAP Results
BLACKSTONE’S THIRD QUARTER 2020 GAAP RESULTS ▪ GAAP Net Income was $1.7 billion for the quarter and $447 million year-to-date (“YTD”). GAAP Net Income Attributable to The Blackstone Group Inc. was $795 million for the quarter and $296 million year-to-date. ($ in thousands, except per share data) (un
Slide 6: Blackstone's Third Quarter 2020 Highlights
BLACKSTONE’S THIRD QUARTER 2020 HIGHLIGHTS ▪ Fee Related Earnings (“FRE”) of $611 million ($0.51/share) in the quarter, up 39% year- over-year – FRE was $2.2 billion for the last twelve months (“LTM”) ($1.81/share), up 30% year- over-year Financial Measures ▪ Distributable Earnings (“DE”) of $772 mi
Slide 7: Blackstone's Third Quarter 2020 Segment Earnings
BLACKSTONE’S THIRD QUARTER 2020 SEGMENT EARNINGS % Change % Change ($ in thousands, except per share data) 3Q'19 3Q'20 vs. 3Q'19 3Q'19 YTD 3Q'20 YTD vs. 3Q'19 YTD Management and Advisory Fees, Net $ 880,345 $ 1,057,840 20% $ 2,538,563 $ 2,975,140 17% Fee Related Performance Revenues 34,225 64,950 90
Slide 8: Summary of Financials
SUMMARY OF FINANCIALS ▪ LTM Fee Related Earnings of $1.81 per share, an increase of 30% year-over-year. ▪ LTM Total Segment Distributable Earnings were $3.0 billion, an increase of 7% year-over-year. Fee Related Earnings per Share Segment Distributable Earnings ($ in millions) $1.81 3Q’20 LTM total:
Slide 9: Investment Performance and Net Accrued Performance Revenues
INVESTMENT PERFORMANCE AND NET ACCRUED PERFORMANCE REVENUES ▪ Strong unrealized appreciation across strategies led to a 31% increase in Net Accrued Performance Revenues to $3.6 billion ($2.96/share) quarter-over-quarter. Investment Performance Net Accrued Performance Revenues (appreciation / gross r
Slide 10: Capital Metrics – Additional Detail
CAPITAL METRICS – ADDITIONAL DETAIL ▪ Inflows were $15.1 billion in the quarter, bringing LTM inflows to $88.7 billion. ▪ Realizations were $7.9 billion in the quarter and $33.3 billion for the LTM. ▪ Deployed $8.6 billion in the quarter and $53.6 billion for the LTM. – Committed an additional $7.7
Slide 11: Assets Under Management
ASSETS UNDER MANAGEMENT ▪ Total AUM increased to $584.4 billion, up 5% year-over-year, with $15.1 billion of inflows in the quarter and $88.7 billion for the LTM. ▪ Fee-Earning AUM of $444.5 billion was up 13% year-over-year, with $11.8 billion of inflows in the quarter and $105.5 billion for the LT
Slide 12: Additional Capital Detail
ADDITIONAL CAPITAL DETAIL ▪ Invested Performance Eligible AUM reached $266.8 billion at quarter end, up 13% year-over-year. ▪ Undrawn capital (“Total Dry Powder”) available for investment of $152.4 billion. Invested Performance Eligible AUM Total Dry Powder ($ in billions) ($ in billions) 3Q’20 tota
Slide 13: Segment Highlights
Segment Highlights Blackstone | 9
Slide 14: Real Estate
REAL ESTATE ▪ Total AUM: Increased 11% to $173.8 billion with inflows of $3.9 billion in the quarter and $29.5 billion for the LTM. – Inflows during the quarter included $2.3 billion in Core+ and $1.3 billion in BREDS. – Perpetual Capital increased 27% to $60.4 billion, representing nearly 35% of To
Slide 15: Private Equity
PRIVATE EQUITY ▪ Total AUM: Increased 9% to $189.2 billion with inflows of $3.9 billion in the quarter and $26.3 billion for the LTM. – Inflows included $2.3 billion for Blackstone Growth which officially launched in the quarter. – Fee-Earning AUM increased 32% to $129.7 billion, driven by commencem
Slide 16: Hedge Fund Solutions
HEDGE FUND SOLUTIONS ▪ Total AUM: $77.8 billion with inflows of $1.7 billion in the quarter and $11.0 billion for the LTM. – Strong market appreciation of $2.3 billion in the quarter. – Continued fundraising strength in new products with higher effective management fees. – October 1 subscriptions of
Slide 17: Credit & Insurance
CREDIT & INSURANCE ▪ Total AUM: $143.6 billion with inflows of $5.6 billion in the quarter and $21.9 billion for the LTM. – Inflows of $1.7 billion for the fourth mezzanine / opportunistic fund in the quarter, bringing total raised to $2.8 billion, including a close subsequent to quarter end. – Clos
Slide 18: Supplemental Details
Supplemental Details Blackstone | 14
Slide 19: Total Segments
TOTAL SEGMENTS ($ in thousands) 3Q'19 4Q'19 1Q'20 2Q'20 3Q'20 3Q'19 YTD 3Q'20 YTD Base Management Fees $ 809,729 $ 873,368 $ 910,396 $ 941,794 $ 1,043,770 $ 2,372,562 $ 2,895,960 Transaction, Advisory and Other Fees, Net 92,702 95,073 50,665 48,292 33,628 219,347 132,585 Management Fee Offsets (22,0
Slide 20: Assets Under Management - Rollforward
ASSETS UNDER MANAGEMENT - ROLLFORWARD Total AUM Rollforward ($ in millions) Three Months Ended September 30, 2020 Twelve Months Ended September 30, 2020 Real Private Hedge Fund Credit & Real Private Hedge Fund Credit & Total Total Estate Equity Solutions Insurance Estate Equity Solutions Insurance B
Slide 21: Deconsolidated Balance Sheet Highlights
DECONSOLIDATED BALANCE SHEET HIGHLIGHTS ▪ At September 30, 2020, Blackstone had $5.6 billion in total cash, cash equivalents, and corporate treasury investments and $11.1 billion of cash and net investments, or $9.21 per share. ▪ Blackstone has a $1.6 billion undrawn credit revolver and maintains A+
Slide 22: Net Accrued Performance Revenues – Additional Detail
NET ACCRUED PERFORMANCE REVENUES – ADDITIONAL DETAIL 3Q'20 ($ in millions, except per share data) 3Q'19 2Q'20 3Q'20 Per Share 3Q’20 QoQ Rollforward Real Estate BREP IV $ 11 $ 7 $ 8 $ 0.01 ($ in millions) BREP V 16 1 7 0.01 Net Net Performance Realized BREP VI 75 45 46 0.04 2Q'20 Revenues Distributio
Slide 23: Investment Records as of September 30, 2020
INVESTMENT RECORDS AS OF SEPTEMBER 30, 2020 (a) ($/€ in thousands, except where noted) Committed Available Unrealized Investments Realized Investments Total Investments Net IRRs (d) Fund (Investment Period Beginning Date / Ending Date) Capital Capital (b) Value MOIC (c) Value MOIC (c) Value MOIC (c)
Slide 24: Investment Records as of September 30, 2020 (Cont'd)
INVESTMENT RECORDS AS OF SEPTEMBER 30, 2020 (a) – (CONT’D) ($/€ in thousands, except where noted) Committed Available Unrealized Investments Realized Investments Total Investments Net IRRs (d) Fund (Investment Period Beginning Date / Ending Date) Capital Capital (b) Value MOIC (c) Value MOIC (c) Val
Slide 25: Investment Records – Notes
INVESTMENT RECORDS AS OF SEPTEMBER 30, 2020 – NOTES The returns presented herein represent those of the applicable Blackstone Funds and not those of The Blackstone Group Inc. n/m Not meaningful generally due to the limited time since initial investment. n/a Not applicable. (a) Excludes investment ve
Slide 26: Shareholder Dividends
SHAREHOLDER DIVIDENDS ▪ Generated $0.63 of Distributable Earnings per common share during the quarter, bringing the year-to-date amount to $1.52 per common share. ▪ Blackstone declared a quarterly dividend of $0.54 per common share to record holders as of November 9, 2020; payable on November 16, 20
Slide 27: Share Summary
SHARE SUMMARY ▪ Distributable Earnings Shares Outstanding as of quarter end of 1,201 million shares. – Repurchased 2.0 million common shares in the quarter and 10.5 million common shares for the LTM. – Available authorization remaining was $307 million at September 30, 2020. 3Q'19 4Q'19 1Q'20 2Q'20
Slide 28: Reconciliations and Disclosures
Reconciliations and Disclosures Blackstone | 24
Slide 29: Reconciliation of GAAP to Non-GAAP Measures
RECONCILIATION OF GAAP TO NON-GAAP MEASURES QTD YTD LTM ($ in thousands) 3Q'19 4Q'19 1Q'20 2Q'20 3Q'20 3Q'19 3Q'20 3Q'19 3Q'20 Net Income (Loss) Attributable to $ 779,437 $ 483,149 $ (1,066,492) $ 568,266 $ 794,719 $ 1,566,533 $ 296,493 $ 1,555,665 $ 779,642 The Blackstone Group Inc. Net Income (Los
Slide 30: Reconciliation of GAAP to Non-GAAP Measures – Notes
RECONCILIATION OF GAAP TO NON-GAAP MEASURES – NOTES Note: See pages 34-35, Definitions and Dividend Policy. (a) This adjustment removes Transaction-Related Charges, which are excluded from Blackstone’s segment presentation. Transaction-Related Charges arise from corporate actions including acquisiti
Slide 31: Reconciliation of GAAP to Non-GAAP Measures – Notes
RECONCILIATION OF GAAP TO NON-GAAP MEASURES – NOTES (j) Taxes represent the total GAAP tax provision adjusted to include only the current tax provision (benefit) calculated on Income (Loss) Before Provision (Benefit) for Taxes and adjusted to exclude the tax impact of any divestitures. Related Payab
Slide 32: Blackstone's Third Quarter 2020 GAAP Balance Sheet Results
BLACKSTONE’S THIRD QUARTER 2020 GAAP BALANCE SHEET RESULTS ($ in thousands) (unaudited) 3Q'19 4Q'19 1Q'20 2Q'20 3Q'20 Assets Cash and Cash Equivalents $ 2,468,563 $ 2,172,441 $ 2,068,326 $ 1,976,512 $ 2,628,895 Cash Held by Blackstone Funds and Other 375,981 351,210 318,003 343,201 85,218 Investment
Slide 33: Reconciliation of GAAP to Non-GAAP Balance Sheet Measures
RECONCILIATION OF GAAP TO NON-GAAP BALANCE SHEET MEASURES ($ in thousands) 3Q'19 4Q'19 1Q'20 2Q'20 3Q'20 Investments of Consolidated Blackstone Funds $ 8,481,233 $ 8,380,698 $ 7,275,752 $ 7,943,531 $ 1,500,398 Equity Method Investments Partnership Investments 3,864,453 4,035,675 3,553,538 3,873,346
Slide 34: Reconciliation of GAAP to Total Segments
RECONCILIATION OF GAAP TO TOTAL SEGMENTS QTD YTD LTM ($ in thousands) 3Q'19 4Q'19 1Q'20 2Q'20 3Q'20 3Q'19 3Q'20 3Q'19 3Q'20 Management and Advisory Fees, Net GAAP $ 878,151 $ 943,900 $ 934,832 $ 969,728 $ 1,053,851 $ 2,528,255 $ 2,958,411 $ 3,325,809 $ 3,902,311 Segment Adjustment (a) 2,194 1,773 5,
Slide 35: Reconciliation of GAAP to Total Segments – (Cont'd)
RECONCILIATION OF GAAP TO TOTAL SEGMENTS – (CONT’D) QTD YTD LTM ($ in thousands) 3Q'19 4Q'19 1Q'20 2Q'20 3Q'20 3Q'19 3Q'20 3Q'19 3Q'20 Realized Performance Compensation GAAP Incentive Fee Compensation $ 5,419 $ 24,589 $ 6,522 $ 8,432 $ 7,385 $ 19,711 $ 22,339 $ 29,971 $ 46,928 Realized Performance A
Slide 36: Notes
NOTES Notes to page 1 - Blackstone’s Third Quarter 2020 GAAP Results ▪ Effective July 1, 2019, The Blackstone Group L.P. converted from a Delaware limited partnership to a Delaware corporation, The Blackstone Group Inc. (the “Conversion”). This presentation includes results for The Blackstone Group
Slide 37: Notes – (Cont'd)
NOTES – (CONT’D) Notes to page 5 - Investment Performance and Net Accrued Performance Revenues (Cont’d) ▪ Effective 1Q’20, Credit returns are presented as a composite return instead of separate returns for performing credit and distressed. The Credit Composite now also includes the long only strateg
Slide 38: Definitions and Dividend Policy
DEFINITIONS AND DIVIDEND POLICY Blackstone discloses the following operating metrics and financial measures that are calculated and presented on the basis of methodologies other than in accordance with generally accepted accounting principles in the United States of America (“non-GAAP”) in this pres
Slide 39: Definitions and Dividend Policy – (Cont'd)
DEFINITIONS AND DIVIDEND POLICY – (CONT’D) – Fee Related Compensation is presented on a segment basis and refers to the compensation expense, excluding Equity-Based Compensation, directly related to (a) Management and Advisory Fees, Net and (b) Fee Related Performance Revenues, referred to as Fee Re
Slide 40: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS This presentation may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which reflect our current views with respect to, among other things, ou