Private equity group KKR & Co said on Wednesday its second-quarter adjusted net income jumped 49% year-on-year, driven by an increase in management, transaction and performance fees, as well as earnings from its annuities business.
KKR's adjusted net income rose to $972 million from $653 million a year earlier. This translated into adjusted net income per share of $1.09. That was slightly ahead of the average analyst estimate of $1.07, according to LSEG data.
The company reported record fee-related earnings of $755 million, a 25% increase from the previous year. This growth was fueled by fees generated from managing $601 billion in total assets, up 16% year-over-year, along with transaction fees from arranging financing for its own deals.
KKR's shares were up 3.72% at $124.25 early on Wednesday, giving the private equity group a market value of about $110 billion.
KKR reported management fees of $847 million for the quarter, while net transaction and monitoring fees totaled $223 million. Capital markets activities contributed $192 million to revenues.
The company has been cashing out on more of its investments. KKR and BlackRock Inc sold their 40% stake in Abu Dhabi National Oil Co's oil pipeline network to an Abu Dhabi-based firm earlier this year. Earlier this month, KKR took financial software maker OneStream public, raising $490 million.
"Deal pipelines are up and visibility is high,” said KKR CEO Scott Nuttall. “Unless something happens to disrupt his momentum, we expect to see increased activity in the second half of this year relative to the first.”
For the quarter, KKR reported total operating earnings of $1 billion, a 36% year-over-year increase. This metric includes fee-related earnings from its asset management business, returns from long-term private equity holdings, and profits from its Global Atlantic insurance division.
KKR's private equity portfolio appreciated by 4% in the second quarter, opportunistic real estate funds rose 1%, and leveraged credit funds rose by 2%.
KKR amassed $32 billion in new investor capital, marking the second most active fundraising quarter in its history, driven by inflows at Global Atlantic, opportunistic asset-based finance, direct lending in the U.S. and Europe, and collateralized loan obligation formation.
It also deployed $23 billion in investments, up from $10 billion one year ago, and declared a quarterly dividend of 17.5 cents.
