Slide 1: TPG Reports Fourth Quarter and Full Year 2023 Financial Results
TPG Reports Fourth Quarter and Full Year 2023 Financial Results Year Ended December 31, 2023
Slide 2: TPG Reports Fourth Quarter and Full Year 2023 Results
TPG Reports Fourth Quarter and Full Year 2023 Results ▪ Completed strategic acquisition of Angelo Gordon on November 1, 2023 ▪ Total assets under management of $222 billion as of December 31, 2023, an increase of 64% compared to $135 billion as of December 31, 2022 ▪ GAAP net income attributable to
Slide 3: About TPG; Forward Looking Statements
TPG Reports Fourth Quarter and Full Year 2023 Results About TPG TPG is a leading global alternative asset management firm, founded in San Francisco in 1992, with $222 billion of assets under management and investment and operational teams around the world. TPG invests across a broadly diversified se
Slide 4: Comparability Statement and Pro Forma Financial Information
Comparability Statement and Pro Forma Financial Information On November 1, 2023, the Company acquired (the “Acquisition”) Angelo Gordon and certain of its affiliates (collectively, “Angelo Gordon” or “AG,” and after the Acquisition, “TPG Angelo Gordon” or “TPG AG”). Accordingly, the results of TPG A
Slide 5: Fourth Quarter and Full Year 2023 Results
Fourth Quarter and Full Year 2023 Results
Slide 6: GAAP Statements of Operations (Unaudited)
GAAP Statements of Operations (Unaudited) ▪ Net income of $42 million for 4Q’23 compared to 4Q’22 net loss of $10 million ▪ Net income attributable to TPG Inc. of $13 million for 4Q’23 compared to net income of $24 million in 4Q’22 ($ in thousands, except share and per share amounts) 4Q’22 4Q’23 FY’
Slide 7: Fourth Quarter and Full Year Highlights
Fourth Quarter and Full Year Highlights ▪ 4Q’23 and FY’23 results include two months of TPG AG, from November 1, 2023, the date of the Acquisition, to December 31, 2023 ▪ 4Q’23 FRR of $465 million increased 51% versus 4Q’22, with 4Q’23 FRE of $226 million and 4Q’23 After- tax DE of $206 million Non-
Slide 8: Non-GAAP Financial Measures
Non-GAAP Financial Measures ▪ FRE increased 62% from $139 million in 4Q’22 to $226 million in 4Q’23; FRE margin increased to 49% in 4Q’23 compared to 45% in 4Q’22 ▪ After-tax DE of $206 million in 4Q’23, a decrease from $227 million in 4Q’22, primarily due to a decrease in realized performance alloc
Slide 9: Fee-Related Earnings
Fee-Related Earnings ▪ 4Q’23 FRR increased 51% over 4Q’22, primarily driven by the Acquisition, catch-up management fees, and an increase in capital markets fees ▪ Fee-Related Expenses in 4Q’23 increased 42% over 4Q’22, primarily due to the addition of TPG AG ▪ 4Q’23 FRE margin of 49%, an increase f
Slide 10: Distributable Earnings
Distributable Earnings ▪ After-tax DE decreased from $227 million in 4Q’22 to $206 million for 4Q’23, primarily due to less realized performance allocations, net year-over-year, as well as higher non-core expenses associated with the Acquisition, partially offset by an increase in FRE After-Tax DE D
Slide 11: Realized Performance Allocations, Net
Realized Performance Allocations, Net ▪ Realized performance allocations, net were $19 million in 4Q’23, primarily driven by TPEP in the Market Solutions platform, TPG VIII in the Capital platform, and MVP Fund in TPG AG Credit ▪ Realized performance allocations, net for FY’23 were $74 million, prim
Slide 12: Net Accrued Performance
Net Accrued Performance Investment 4Q’23 Net Accrued Performance Appreciation / (Depreciation) ($M) Platform 4Q’23 FY’23 $12 $27 Capital 3.1% 8.2% Growth 3.0% 5.9% $97 Impact 6.6% 17.0% $59 TPG AG TPG AG Credit 3.8% 14.1% Total $404 TPG AG Real Estate 0.4% (0.3%) $891 Real Estate (1.5%) (2.8%) $107
Slide 13: GAAP Balance Sheet (Unaudited)
GAAP Balance Sheet (Unaudited) ▪ Our investments increased $1.4 billion from 4Q'22 to 4Q’23, mainly driven by the addition of $761 million of performance allocations attributable to TPG AG at November 1, 2023, the date of the Acquisition ▪ Cash decreased to $0.7 billion at the end of 4Q’23 primarily
Slide 14: Non-GAAP Balance Sheet
Non-GAAP Balance Sheet ▪ Cash and cash equivalents of $105 million at the end of 4Q’23 ▪ At the end of 4Q’23, our net debt(1) was $846 million and our undrawn credit facility capacity was $699 million(2) ▪ Our borrowings include $501 million drawn on our revolving credit facility, securitized notes
Slide 15: Operating Metrics
Operating Metrics
Slide 16: Assets Under Management and Fee Earning AUM
Assets Under Management and Fee Earning AUM ▪ 4Q’23 AUM rose 64% over 4Q’22 to $221.6 billion, primarily driven by the inclusion of TPG AG following the Acquisition ▪ Over the last twelve months, capital raised totaled $15.7 billion, including $3.1 billion in TPG IX and $1.6 billion in THP II within
Slide 17: Assets Under Management and Fee Earning AUM Duration
Assets Under Management and Fee Earning AUM Duration ▪ At the end of 4Q’23, approximately 69% of our AUM and 65% of our FAUM was in perpetual or long-dated funds with a duration(1) of 10 or more years (prior to any available extensions) ▪ At the end of 4Q’23, approximately 68% of our FAUM had a rema
Slide 18: AUM Subject to Fee Earning Growth
AUM Subject to Fee Earning Growth ▪ AUM Subject to Fee Earning Growth totaled $24.4 billion at the end of 4Q’23 and includes AUM Not Yet Earning Fees (capital commitments that generate new management fees once deployed) and FAUM Subject to Step-Up (capital commitments that generate a higher rate of
Slide 19: Performance Eligible and Generating AUM
Performance Eligible and Generating AUM ▪ Performance Eligible AUM refers to AUM that is currently producing, or may eventually produce, performance revenues, and totaled $191.8 billion, or 87% of total AUM, at the end of 4Q’23 ▪ Performance Generating AUM refers to AUM that is currently producing p
Slide 20: AUM Rollforward
AUM Rollforward ▪ AUM increased 63% during 4Q’23 and $86.6 billion, or 64%, in the last twelve months ▪ The AUM increase in 4Q’23 was primarily driven by the inclusion of TPG AG following the Acquisition; capital raised totaled $8.8 billion while realizations were $2.7 billion ▪ AUM growth for the l
Slide 21: FAUM Rollforward
FAUM Rollforward ▪ FAUM increased 73% in 4Q’23 and 76% in the last twelve months ▪ FAUM growth in 4Q’23 was primarily driven by the inclusion of TPG AG following the Acquisition, with fee earning capital raised totaling $5.0 billion and a net increase in investment activity of $2.6 billion ▪ In the
Slide 22: Other Operating Metrics
Other Operating Metrics ▪ At the end of 4Q’23, we had $51.3 billion of capital available for deployment; we have invested approximately $22.2 billion during the year (All tables in $M) Capital Raised 4Q’22 4Q’23 FY’22 FY’23 Available Capital 4Q’22 4Q’23 Capital $ 721 $ 4,624 $ 15,319 $ 9,047 Capital
Slide 23: Supplemental Details
Supplemental Details
Slide 24: GAAP and Non-GAAP Performance Allocations
GAAP and Non-GAAP Performance Allocations Three Months Ended December 31, 2023 GAAP Less: GAAP GAAP Less: Non-GAAP Non-GAAP (1) (2) ($ in thousands) Total Unrealized Realized Adjustments Realized Capital $ 171,443 $ 145,373 $ 26,070 $ 20,616 $ 5,454 Growth 87,324 82,371 4,953 3,911 1,042 Impact 101,
Slide 25: GAAP and Non-GAAP Net Accrued Performance
GAAP and Non-GAAP Net Accrued Performance As of September 30, 2023 Real Market ($ in millions) Capital Growth Impact Estate Solutions Total GAAP Total $ 2,541 $ 1,337 $ 441 $ 175 $ 131 $ 4,625 Less: Excluded Assets(1) 55 255 — 60 — 370 (2) Less: Non-GAAP Adjustments 2,111 910 354 92 96 3,563 Non-GAA
Slide 26: After-Tax DE and Dividends Per Class A Common Stock
After-Tax DE and Dividends Per Class A Common Stock ▪ After-tax DE attributable to TPG Inc. of $0.51 per share for 4Q’23, and $1.57 per share for FY’23 ▪ Declared dividend of $0.44 per share for 4Q’23 on February 13, 2024, with a record date of February 23, 2024 and payable date of March 8, 2024; di
Slide 27: Fee-Related Earnings Per Class A Common Stock
Fee-Related Earnings Per Class A Common Stock ▪ FRE attributable to TPG Inc. of $0.65 per share for 4Q’23 and $1.88 per share for FY’23 ($ in thousands, except share and per share amounts) 3Q’23 4Q’23 Fee-Related Earnings attributable to TPG Inc. Class A common stockholders Total Fee-Related Earning
Slide 28: Distributable Earnings Participating Shares Outstanding
Distributable Earnings Participating Shares Outstanding (shares) 3Q’23 4Q’23 TPG Inc. Diluted Shares Outstanding Class A common stock outstanding 80,587,371 80,596,501 Common Units exchangeable into Class A common stock(1) 228,652,641 281,657,626 Diluted Class A common stock outstanding 309,240,012
Slide 29: Equity-Based Compensation Summary
Equity-Based Compensation Summary ▪ Equity-based compensation related to TPG Inc. Ordinary Service Awards totaled $12 million in 4Q’23; the total unrecognized compensation expense related to these Awards amounted to $103 million at the end of 4Q’23, and is expected to be recognized over the next 2.5
Slide 30: Fund Performance Metrics
Fund Performance Metrics ($ in millions, as of 12/31/23) Vintage Capital Capital Realized Unrealized Total Gross Gross Net Net Fund Year(1) Committed(2) Invested(3) Value(4) Value(5) Value(6) IRR(7) MoM(7) IRR(8) MoM(9) Platform: Capital Capital Funds Air Partners 1993 $ 64 $ 64 $ 697 $ — $ 697 81%
Slide 31: Fund Performance Metrics (Cont'd)
Fund Performance Metrics (Cont’d) ($ in millions, as of 12/31/23) Vintage Capital Capital Realized Unrealized Total Gross Gross Net Net Fund Year(1) Committed(2) Invested(3) Value(4) Value(5) Value(6) IRR(7) MoM(7) IRR(8) MoM(9) Platform: Growth Growth Funds STAR 2007 $ 1,264 $ 1,259 $ 1,865 $ 42 $
Slide 32: Fund Performance Metrics (Cont'd)
Fund Performance Metrics (Cont’d) ($ in millions, as of 12/31/23) Vintage Capital Capital Realized Unrealized Total Gross Gross Net Net Fund Year(1) Committed(2) Invested(3) Value(4) Value(5) Value(6) IRR(7) MoM(7) IRR(8) MoM(9) Platform: Real Estate TPG Real Estate Partners DASA RE 2012 $ 1,078 $ 5
Slide 33: Fund Performance Metrics (Cont'd)
Fund Performance Metrics (Cont’d) ($ in millions, as of 12/31/23) Vintage Capital Capital Realized Unrealized Total Gross Gross Net Net Fund Year(1) Committed(2) Invested(3) Value(4) Value(5) Value(6) IRR(7) MoM(7) IRR(8) MoM(9) Structured Credit & Specialty Finance ABC Fund 2021 $ 1,005 $ 653 $ 29
Slide 34: Fund Performance Metrics (Cont'd)
Fund Performance Metrics (Cont’d) ($ in millions, as of 12/31/23) Vintage Capital Capital Realized Unrealized Total Gross Gross Net Net Fund Year(1) Committed(2) Invested(3) Value(4) Value(5) Value(6) IRR(7) MoM(7) IRR(8) MoM(9) Asia Real Estate Asia Realty Asia Realty I 2006 $ 526 $ 506 $ 645 $ — $
Slide 35: Significant Perpetual Funds
Significant Perpetual Funds ($ in millions, as of 12/31/23) Vintage Total (1) Fund Year AUM Return(10) Platform: Market Solutions TPEP Long/Short(15) 2013 $ 2,099 126% TPEP Long Only (15) 2013 1,915 39% Platform: TPG Angelo Gordon Credit Solutions Corporate Credit Opportunities(16) 1988 333 10% Stru
Slide 36: Fund Performance Metrics Notes
Fund Performance Metrics Notes “NM” signifies that the relevant data would not be meaningful. Performance metrics are generally deemed “NM” when, among other reasons, there has been limited time since initial investment. Performance metrics generally exclude amounts attributable to the fund’s genera
Slide 37: Fund Performance Metrics Notes (Cont'd)
Fund Performance Metrics Notes (Cont’d) 12) Each Middle Market Direct Lending fund is comprised of four vehicles: onshore levered, onshore unlevered, offshore levered and offshore unlevered. Capital Committed, Capital Invested, Realized Value, Unrealized Value and Total Value for each fund are prese
Slide 38: GAAP Statements of Operations Expanded (Unaudited)
GAAP Statements of Operations Expanded (Unaudited) ($ in thousands) 4Q’22 1Q’23 2Q’23 3Q’23 4Q’23 FY’23 Revenues Fees and other $ 350,179 $ 311,471 $ 327,103 $ 366,149 $ 529,903 $ 1,534,626 Capital allocation-based (loss) income 89,156 331,674 276,171 (205,794) 453,234 855,285 Total revenues 439,335
Slide 39: Non-GAAP Financial Measures Expanded
Non-GAAP Financial Measures Expanded ($ in thousands) 4Q’22 1Q’23 2Q’23 3Q’23 4Q’23 FY’23 Fee-Related Revenues Management fees $ 249,933 $ 247,998 $ 256,612 $ 278,503 $ 395,608 $ 1,178,721 Fee-related performance revenues — — — — 1,642 1,642 Transaction, monitoring and other fees, net 46,245 4,672 1
Slide 40: Reconciliations and Disclosures
Reconciliations and Disclosures
Slide 41: GAAP to Non-GAAP Financial Measures Reconciliation
GAAP to Non-GAAP Financial Measures Reconciliation ($ in thousands) 4Q’22 1Q’23 2Q’23 3Q’23 4Q’23 FY’23 GAAP Revenue $ 439,335 $ 643,145 $ 603,274 $ 160,355 $ 983,137 $ 2,389,911 Capital-allocation based income (89,156) (331,674) (276,171) 205,794 (453,234) (855,285) Expense reimbursements (43,172)
Slide 42: GAAP to Non-GAAP Balance Sheet Reconciliation
GAAP to Non-GAAP Balance Sheet Reconciliation ($ in thousands) 4Q’22 4Q’23 ($ in thousands) 4Q’22 4Q’23 Total GAAP Assets $ 7,941,738 $ 9,369,672 Total GAAP Liabilities $ 4,202,232 $ 6,008,538 Impact of consolidated Public SPACs Impact of consolidated Public SPACs Cash and cash equivalents (5,097) —
Slide 43: 4Q'23 Pro Forma GAAP Statement of Operations
4Q’23 Pro Forma GAAP Statement of Operations Three Months Ended December 31, 2023 Historical Transaction Transaction Accounting Accounting Compensation Pro Forma ($ in thousands) TPG Inc. Angelo Gordon Adjustments Notes Adjustments Notes Combined Revenues Fees and other $ 529,903 $ 50,216 $ (1,000)
Slide 44: FY'23 Pro Forma GAAP Statement of Operations
FY’23 Pro Forma GAAP Statement of Operations Year Ended December 31, 2023 Historical Transaction Transaction Accounting Accounting Compensation Pro Forma ($ in thousands) TPG Inc. Angelo Gordon Adjustments Notes Adjustments Notes Combined Revenues Fees and other $ 1,534,626 $ 483,413 $ (464) (1), (4
Slide 45: Notes to Pro Forma GAAP Statement of Operations
Notes to Pro Forma GAAP Statement of Operations Transaction Accounting Adjustments 1) Reflects statement of operations activities that will not continue for the combined company, including: a) Removal of amounts related to Angelo Gordon’s CLOs that were deconsolidated in Angelo Gordon's unaudited co
Slide 46: Notes to Pro Forma GAAP Statement of Operations (Cont'd)
Notes to Pro Forma GAAP Statement of Operations (Cont’d) Transaction Accounting Adjustments (Cont’d) 4) Represents the reduction of management fee income related to a certain fund where TPG did not acquire 100% of the on-going management fee stream. This arrangement results in a reduction of managem
Slide 47: Notes to Pro Forma GAAP Statement of Operations (Cont'd)
Notes to Pro Forma GAAP Statement of Operations (Cont’d) Transaction Accounting Compensation Adjustments TPG issued unvested Common Units and RSUs to Angelo Gordon partners that are considered compensatory under U.S. GAAP and are not included in the Purchase Price. Such offering of equity instrument
Slide 48: 4Q'23 Pro Forma Non-GAAP Financial Measures
4Q’23 Pro Forma Non-GAAP Financial Measures Three Months Ended December 31, 2023 Historical Pro Forma Adjustments Transaction Transaction Pro Forma Accounting Compensation Non-GAAP ($ in thousands) TPG Inc. Angelo Gordon Adjustments Notes Adjustments Notes Combined Management fees $ 395,608 $ 39,397
Slide 49: FY'23 Pro Forma Non-GAAP Financial Measures
FY’23 Pro Forma Non-GAAP Financial Measures Year Ended December 31, 2023 Historical Pro Forma Adjustments Transaction Transaction Pro Forma Accounting Compensation Non-GAAP ($ in thousands) TPG Inc. Angelo Gordon Adjustments Notes Adjustments Notes Combined Management fees $ 1,178,721 $ 401,193 $ (3
Slide 50: Notes to Pro Forma Combined Non-GAAP Financial Measures
Notes to Pro Forma Combined Non-GAAP Financial Measures Transaction Accounting Adjustments 1) Relates to the removal of charges related to an insurance program of $0.1 million and $1.3 million for the three months and year ended December 31, 2023, respectively, that did not continue after the consum
Slide 51: Pro Forma GAAP to Non-GAAP Reconciliation
Pro Forma GAAP to Non-GAAP Reconciliation ($ in thousands) 4Q’23 FY’23 Pro Forma Net (loss) income $ (18,690) $ (305,139) Net (income) loss attributable to redeemable interests in Public SPACs — (12,044) Net loss (income) attributable to other non-controlling interests (64,028) (8,630) Amortization
Slide 52: Additional Information
Additional Information Dividend Policy Our current intention is to pay holders of our Class A common stock and nonvoting Class A common stock a quarterly dividend representing at least 85% of TPG Inc.’s share of distributable earnings attributable to the TPG Operating Group, subject to adjustment as
Slide 53: Definitions
Definitions After-tax Distributable Earnings (“After-tax DE”) is a non-GAAP performance measure of our distributable earnings after reflecting the impact of income taxes. We use it to assess how income tax expense affects amounts available to be distributed to our Class A common stock holders and Co
Slide 54: Definitions (Cont'd)
Definitions (Cont’d) Distributable Earnings (“DE”) is used to assess performance and amounts potentially available for distributions to partners. DE is derived from and reconciled to, but not equivalent to, its most directly comparable U.S. GAAP measure of net income. DE differs from U.S. GAAP net i
Slide 55: Definitions (Cont'd)
Definitions (Cont’d) Loan Level Return, with respect to our CLOs, represents gross returns which are presented on a total return basis for invested assets held, excluding any financing costs or operating fees incurred and using a time-weighted return methodology. Returns over multiple periods are ca