The Carlyle Group on Wednesday reported lower earnings for its third quarter, amid a slow period in selling its investments.
The private equity giant said it earned $195 million before taxes in the quarter, a decline of 11 percent from the period a year earlier. That pre-tax measure of profit, known as economic net income, accounts for unrealized investment gains and excludes certain costs.
After taxes, Carlyle said it earned $160.2 million in the quarter. That amounted to 51 cents per share, falling short of the estimate of 60 cents a share by analysts surveyed by Thomson Reuters.
The value of Carlyle’s overall portfolio from which it collects profit rose 4 percent in the quarter, the firm said. Its private equity funds were up 5 percent, while its other assets, including real estate, had more modest gains, the firm said.
Carlyle’s results lagged behind two big rivals, Kohlberg, Krarvis, Roberts & Company and the Blackstone Group, which both reported higher earnings in the third quarter. With stock markets rising, many private equity firms have been moving to sell their holdings to the investing public.
But for Carlyle, the third quarter was a relatively slow one when it came to “exits†â€" industry parlance for realizing gains on investments.
The firm said its distributable earnings in the quarter, a measure of payouts to investors in its funds, amounted to $105 million before taxes, a steep drop from $207 million in the period a year earlier.
One bright spot for Carlyle was its fund-raising. The firm raised $6.5 billion in new capital in the third quarter, as it secured commitments from existing investors and attracted new ones.
“We continue to see strong interest from fund investors for Carlyle products, and our overall pace of fundraising is the highest since 2007,†David M. Rubenstein, the firm’s co-chief executive, said in a statement.
Big private equity firms like Carlyle prefer to measure their results using a standard that is not generally accepted accounting principles. But by that metric, Carlyle reported income of $2.3 million in the quarter, compared with $18.6 million a year earlier.
