Kkr & Co. Inc. · NYSE:KKR
Kkr & — Goldman Sachs Financial Services Conference 2023
36 slides from Kkr &'s conference presentation, Dec 6, 2023
Slide 1: KKR & Co. Inc.
KKR & Co. Inc. February 7, 2023 Goldman Sachs Financial Services Conference December 6, 2023
Slide 2: Legal Disclosures
Legal Disclosures This presentation has been prepared by KKR & Co. Inc. solely for informational purposes for its public stockholders in connection with evaluating the business, operations and financial results of KKR & Co. Inc. and its subsidiaries (collectively, “KKR”), which includes The Global A
Slide 3: What We Announced on November 29th
What We Announced on November 29th Acquiring remaining stake in Global Atlantic for ~$2.7 billion 1 in cash, increasing ownership from 63% to 100% 2 Creating new Strategic Holdings segment 3 Modifying compensation ratios 4 Introducing new segment reporting framework KKR expects to implement these ch
Slide 4: Why We Are Making These Changes
Why We Are Making These Changes Change Rationale • Faster Acquiring remaining 37% stake More value for more clients • More investing synergies Growth in Global Atlantic • Full alignment Anticipated • Core PE portfolio of sufficient scale to merit Creating new Strategic • standalone reporting Portfol
Slide 5: Compelling Value Creation Opportunity
Compelling Value Creation Opportunity Change 2024 Expected % Accretion Acquiring remaining 37% stake 10%+ to Fee Related in Global Atlantic Earnings per share Creating new Strategic Holdings segment ~20% to Total Operating Earnings per share Modifying compensation ratios ~10% to After-tax Distributa
Slide 6: Increased 2026 Fee Related Earnings target
Given strong performance and our conviction looking forward, alongside these announcements, we increased our 2026 Fee Related Earnings target: $4+ per share $4.50+ per share Note: Our expectations about future Fee Related Earnings has been estimated using various assumptions, and there is no guarant
Slide 7: KKR's More Recurring Earnings Are Expected To Increase
KKR’s More Recurring Earnings Are Expected To Increase Strategic Insurance Fee Related Holdings Operating Earnings Operating Earnings Earnings Total Operating Earnings We expect approximately 70% of pre-tax earnings to be more recurring in nature with the implementation of today’s announcements Note
Slide 8: Topics for Today
Topics for Today Asset Management • We have multiple identifiable avenues for future growth • AUM has doubled since July 2020 original KKR acquisition Insurance • announcement: $72 billion $158 billion today(1) We see opportunities to do even more together with GA as a 100% owned company • Strong,
Slide 9: Asset Management
S EC T I O N O N E Asset Management
Slide 10: Increased Diversification Across Products and Geographies
Increased Diversification Across Products and Geographies… 2010 Today • North America PE • North America PE • Health Care Growth • Asia PE • Europe PE • Global Impact • Europe PE • Asia PE • Asia Tech Private • • Middle Market (Ascendant) Core PE • • Customized Portfolio Solutions K-Series – Private
Slide 11: Has Led to Continued Growth in AUM
…Has Led to Continued Growth in AUM KKR Assets Under Management ($ in billions) $528 $528 Liquid Strategies $27 $471 Private Credit & Alternative Credit Strategic $93 Investments Leveraged Credit +20% $110 CAGR Real Estate $218 Real Assets $125 Infrastructure & Energy $168 Growth Equity & Core Priva
Slide 12: How Do We View The Lifecycle Of A Platform?
How Do We View The Lifecycle Of A Platform? Early Developing Maturing Scaled Platform Formation Product Buildout Building Scale Scale Benefits Health Care Growth North America PE Private Equity Asia Tech Technology Growth Global Impact Europe PE Middle Market PE Core PE Customized Portfolio Solution
Slide 13: Infrastructure – Example of a Maturing Business
Infrastructure – Example of a Maturing Business Management Fees Capital Markets Transaction Fees Realized Carried Interest Realized Investment Income AUM Distributable Revenues(1) AUM ($ in millions) ($ in billions) Global Infra, DCIF, Asia Infra $1,000 $56bn $60 Global Infra, $50 DCIF, Asia Infra $
Slide 14: 50%+ of AUM is not yet scaled
How Do We View The Lifecycle Of A Platform? Early Developing Maturing Scaled Platform Formation Product Buildout Building Scale Scale Benefits Health Care Growth North America PE Private Equity Asia Tech Technology Growth Global Impact Europe PE Middle Market PE Core PE Customized Portfolio Solution
Slide 15: 30+ Strategies Targeted to Raise Capital in the Next 12-18 Months
30+ Strategies Targeted to Raise Capital in the Next 12-18 Months • Middle Market Private Equity • K-Series – Private Wealth: Private Equity • North America PE • Customized Portfolio Solutions Private Equity • Asia PE • Core Private Equity • Global Infra • Core+ RE Asia • Asia Infra • Opportunistic
Slide 16: Drivers of Future Value Creation – The Next Leg of Growth
Drivers of Future Value Creation – The Next Leg of Growth 1 Asia 2 Climate 3 Infrastructure 4 Insurance 5 Private Credit (ABF and Direct Lending) 6 Private Wealth 16
Slide 17: Easier to double from here than to get here
We feel it is easier to double from here than it was to double to get here Note: See Appendix for cautionary factors about forward-looking statements. 17
Slide 18: Global Atlantic
S EC T I O N T W O Global Atlantic
Slide 19: Global Atlantic – Complementary Channels
Global Atlantic – Complementary Channels Individual Markets Institutional Markets Block Annuity and Fixed & Indexed Annuities Reinsurance for Life Insurance Insurance Flow Products Companies PRT Reinsurance Preneed Products for Individuals Funding Agreements Top 5 210+ ~$10 billion Top 3 ~25 ~$25 bi
Slide 20: Our Partnership Has Already Surpassed Our Expectations
Our Partnership Has Already Surpassed Our Expectations Global Atlantic AUM Partnership Highlights ($ in billions) Inclusive of the MetLife reinsurance transaction Asset Increased asset origination $158 Management with ~$60 billion originated Growth by KKR since closing 27% CAGR $139 Capital $3 billi
Slide 21: GA Helped Scale Existing Asset Management Businesses
GA Helped Scale Existing Asset Management Businesses Business Building Impact Real Estate Credit AUM ($ in billions) • GA has been critical in scaling several of our existing asset management businesses that are well-suited $35 for insurance company balance sheets 10x • We have delivered significant
Slide 22: There Is More We Can Do Together
But We Know That There Is More We Can Do Together Increased alignment across both organizations, with long-term focus • Working towards shared, clear, long-term objectives • Common management incentive program Global Atlantic to become more growth oriented, delivering more value to more clients • Ca
Slide 23: Core Private Equity
S EC T I O N T H R E E Core Private Equity
Slide 24: An Observation
An Observation Market Capitalization ($ in billions) $777 $740 Public Asset Managers Globally Few asset management firms with $100+ billion market capitalization Note: Market capitalization as of December 4, 2023. Asset Managers inclusive of 3i Group, Affiliated Managers Group, AllianceBernstein, Am
Slide 25: KKR's Core Private Equity Portfolio – A Snapshot
KKR’s Core Private Equity Portfolio – A Snapshot What is Core Private Equity? The strategy targets businesses with some or all of the following characteristics: Lower Leverage Long Duration Over Hold Period Cash More Limited Generative Disruptors Less Cyclical Control More Limited High-Quality Exter
Slide 26: Stable Core PE Portfolio Growth
Stable Core PE Portfolio Growth • The Core portfolio has experienced significant growth, driven by a combination of strong revenue and earnings performance within the portfolio, as well as an expansion of the portfolio itself • On a like-for-like basis(1), the Core portfolio has grown both revenue a
Slide 27: Creation Of A New Strategic Holdings Segment
Creation Of A New Strategic Holdings Segment Given the increased size and scale of our Core Private Equity portfolio, and in order to enhance visibility, we are creating a new Strategic Holdings segment • The maturing Core PE portfolio is starting to generate more recurring and stable dividends. We
Slide 28: In Conclusion
S EC T I O N 4 In Conclusion
Slide 29: Result – Multiple Ways to Win
Result Multiple Ways to Win Asset Management Insurance Strategic Holdings • We operate in large, global • Increased alignment • Core Private Equity holdings markets with secular are more mature tailwinds • More asset origination • Scaled portfolio with ~$775 • Highly differentiated • Global expans
Slide 30: Asset Management, Insurance, Strategic Holdings
Asset Management Insurance Strategic Holdings 30
Slide 31: Appendix
Appendix
Slide 32: Important Information − Endnotes
Important Information − Endnotes Note to Pages 3, 4 and 27 Notes to Page 26 – Stable Core PE Portfolio Growth The acquisition of the remaining 36.7% of Global Atlantic that KKR does not currently own is (1) Like-for-like calculation reflects the underlying revenue/EBITDA growth of investments pursua
Slide 33: Important Information − Non-GAAP and Other Measures
Important Information − Non-GAAP and Other Measures Non-GAAP and Segment Measures Inc. Income Taxes on Operating Earnings represents the (i) amount of income taxes that would be paid assuming that all pre-tax Asset Management distributable earnings were The key non-GAAP and other operating and perfo
Slide 34: Important Information − Non-GAAP and Other Measures (cont'd)
Important Information − Non-GAAP and Other Measures (cont’d) Non-GAAP and Segment Measures (cont’d) • Assets Under Management (AUM) represent the assets managed, advised or sponsored by KKR from which KKR is entitled to receive management fees or performance income (currently or upon a future event)
Slide 35: Important Information − Other Legal Disclosures
Important Information − Other Legal Disclosures Website KKR entity (including any KKR investment fund, vehicle or account, the KKR balance sheet or Global Atlantic insurance company) will achieve results comparable to any results included in From time to time, we may use our website as a channel of
Slide 36: Important Information − Other Legal Disclosures (cont'd)
Important Information − Other Legal Disclosures (cont’d) Forward-Looking Statements dividends, stock repurchases, tax assets, tax liabilities, AUM, FPAUM, After-tax Distributable Earnings, capital invested, uncalled commitments, cash and short-term investments, Fee This presentation contains certain
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