PRIVATE equity firm KKR & Co said on Wednesday (May 1) that its first-quarter adjusted net income jumped 20 per cent year on year, driven by strong management and transaction fees as well as earnings from its annuities business.

KKR’s adjusted net income rose to US$863.7 million from US$719.3 million a year earlier. That resulted in adjusted net income per share of 97 US cents, which was slightly ahead of the average analyst estimate of 96 US cents, according to LSEG data.

Fee-related earnings rose 22 per cent to US$668.7 million, buoyed by income KKR generates from fees associated with managing US$578 billion worth of total assets in addition to transaction fees from arranging financing from its own deals.

KKR’s earnings from investing the capital of its annuities business Global Atlantic rose 33 per cent to US$273 million. During the quarter, KKR completed the US$2.7 billion deal to acquire the remaining 37 per cent stake in Global Atlantic that it does not already own.

Dividends from KKR’s “strategic holdings”, which are mostly private equity investments that it plans to hold for relatively longer periods, reached US$20.7 million in the quarter.

KKR’s private equity portfolio appreciated by 5 per cent, opportunistic real estate funds gained 1 per cent, and leveraged credit funds added 3 per cent.

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By contrast, Blackstone reported that its corporate private equity funds appreciated by 3.4 per cent, liquid credit funds gained by 2.5 per cent, and opportunistic real estate funds were flat.

KKR’s net income under generally accepted accounting principles more than doubled to US$682.2 million, driven by growth in revenues from Global Atlantic.

It raised US$31 billion of new capital, invested US$14 billion, retained US$98 billion of unspent capital, and declared a quarterly dividend of 17.5 US cents. REUTERS