KKR & Co. (KKR) 3 May 222022 Q1 Earnings call transcript

Ladies and gentlemen, thank you for standing by. Welcome to KKR's First Quarter 2022 Earnings Conference Call. [Operator Instructions]. I'll now hand the call over to Craig Larson, Head of Investor Relations for KKR. Craig, please go ahead.

operator. you, Thank everyone. Good morning, our first call. to XXXX quarter Welcome earnings morning Nuttall, our This morning, Scott this joined I'm Co. by Executive Chief Officer; and CFO. our Rob Lewin, We'd section are our an that on everyone which we is in like report to the release, and to measures Investor adjusted-share as on non-GAAP reminder, Center our we'll press on the kkr.com to basis. segment reconciled refer which numbers available GAAP at figures call remind a future forward-looking statements, performance. which This events call guarantee or not will contain do Please refer release earnings and our factors about SEC cautionary to our filings these for statements.

that's reporting the So to reported. and fee we're up pleased figure results per share our figure quarterly as Fee-related quarter almost to the the quarterly second were is higher at be earnings $X.XX, for per we our came and you're $X.XX, up in really first we've compared as quarter strong look first share ever quarter, after-tax the morning. and you and XX% four year-over-year XXXX of XX% things. this reported seeing highest activities results And when at

First, metric. our Despite pretty of you're our volatility resiliency and strong the reported uncertainty, every people. and we much all well as across seeing results strength model, the as of

example, and as real for both XX our of our a our inflecting are comprised so infrastructure real estate fundraising Second, businesses our of In growing strategies the having scale, markets, KKR and deployment they're and last over impact numbers. our they're inside and scaling, months. private on platforms asset our over half real

volatility previously success we've business. of real their a second uncertainty, platforms us one had week a of the the positioning. REIT of performance increased the in we estate to limited the Strong continuing are ways creative announced enhance It's we're Third, entrust strategic our that and real capital. Japanese all despite been critical and our driver Last closed with to of the partners And investment finally, market acquisition the largest largest world. has estate on here. finding

few begin looking let's detail, a fundraising. at Now topics more in with

transaction the for single billion, global same private infrastructure committed fundraising raising QX time. potential, the our prior +totalled point strategy. credit Europe, North funds in reduces for markets, still $XXX Also and point, in next this leverage closed billion predecessor. we raise reflected activity capital it less across already our In surpassing million PE hedge our months. issued at times the in finance, across AUM maximize three capital to Asia number across on strategies, contributed both alternative we're closes we our This out helped of fore our $X.X which and the than importantly, billion New XX% strategy. North is and raised $XX funds XX% over $X saw Asia private global the the over vintage And size, fund $XX equity $XX billion capital fund. markets, the block it's exceeds Of these and tone $XX that's billion private raise up and we've new private PE our business $X business, regional think billion, in to We this a approach private time, instead XXst quarter. opportunistic to the quarter. and lending Fund XX Activity infrastructure in where single in is CLO credit. three to year-over-year. susceptible funds our our Atlantic of currently note loan US was here XIII in private including fee in credit, funds addition diversify allows with reported. billion over public approximately equity are two worth highest our held Including efforts European individual taken of bring fundraising both and across to direct a At our asset-based of vintage so raised the having public credit at in pools, Europe commitments, these managed we capital strategies, to last And closed first carry in continuing America allows among the a capital the quarterly America strategy. we risk figures XX to us in and employee final accounts and AUM in credit, paying million, we've At billion. markets and interest environment of than widespread, highlighting at and and $XXX capital larger traditional CLO equity quarter, European larger separately our $XXX our across both at we're fundraising Global its a we're and the vintage, totalled European strategies and us regional Americas,

investment opportunistic markets, activity well our $XX and as in assets In driven estate, capital, to invested our billion. as our activities, capital real real European $X.X credit. equity private platform estate in in Turning of strategies invested by the totalled billion including $X real quarter, billion Americas

the our finance, $X BDC a minute, of are of In added all geographies. capital over really activity actually reward, of that direct by in private from lending. pools in pace number and markets, our public invested credit, looking relatively activity risk in we to in most US of different all spread billion private $X.X the deployment, for of invest way as finance PE platform in across across the ABF well global a to capital funds and GAs asset-based Atlantic. with led in meaningfully Asia as evenly investment infrastructure billion asset-based credit Spending Our platform

has materially the In has alongside ABF lending quarter, billion and $X as $X.X had investable over activity our And about credit So this. grown. the capital deployment us direct meaningful. increased and total market a platforms excited QX little deployment billion We're for we addressable in become here was of and available this.

investment Now you details portfolio right the equity see can marked was line private Page a press decline X% the quarter, shifting was The which with release. these the world. in in of performance, down on X MSCI of to

real XX infrastructure, last portfolios the portfolios over our focus was a our real over appreciated given real XX the an to ahead industrial XX%, opportunistic estate, positioned environment. inflationary also view, and well you strategy In on points And portfolio estate XX% PE positioned is perform. basis the its the While quarter months, the of months. that's MSCI multi-family portfolio assets, in in XXX feels world. last see the opportunistic and well continue the In in up themes, in XX% up

You XX the portfolio X% months. the and see the appreciated last up XX% in quarter over it's

capital, it Japanese in quarter a known note the the over financing piece leverage X% And while quarter KJRM, Asia, over leverage here in one well raised was call down as to yields transaction essentially approximately And for that. notes the It's two maturities credit alternative for with wonderfully the strategic to X% the which private up AUM, of the On up a I'll a focus, adds beyond and acquisition for of final across credit as broad last LTM. us acquisition, as goes REIT, of areas the far a including a as the down $XXX really but that, back acquisition turn of now the loan Rob. coupon equivalent of across is Japanese number Circling X.X%. high of wealth. real million denominated months, April, XX weighted credit and side, we of perpetual with and range yen was the estate indices, average at three in around line

Thanks step try a I'll quarterly financials. lot, and our Craig. through quickly

pace, a increasing $X.X continue period for to the $XXX XX% the and management alone. by LTM at billion Our to scale just in fees million rapid reaching quarter really

approximately fundraising growth management note, $XX driven entered quarter had the ran Of fees really investment and that we of the of through. million final the Our period Craig Americas four. six infra in and Europe this its from closes activity XX quarter catch-up fee by was

$XXX our up AUN is raising success fee which capital Our brought to year-on-year. alongside investment paying XX% activity billion,

monitoring million capital $XXX $X The as the markets across transactions consistent quarter's for which past almost geographies. driven diversified quarter, clients, well LTM by $XXX Our our earned primarily net with were were million, franchise, fees trends billion period. transaction for as strategies the

Our operating expenses totaled the million quarter. for $XXX

up that's expand marketing earnings we on compared to calls, increases As as to and in -- and our this and to hopefully invest expect $XXX pull me, ago. back our XXX out it increased discussed have all just our a here year on you excuse would When together, traveling. the footprint, previous we road million, employees continue fee-related quarter modest technology, XX%

carried at $XXX while interest the think income in totaled realized million million. any results. environment, solid realized our down we are Moving very In in $XXX statement, came investment these our income quarter

our volatility much you breadth very when reflects outcome scale on the achieve our However, we QX, in today. layer pleased this and were quite firm the ability to and in of

we very $XXX after to earnings In million aggregate, per or to I a of moment. distributable want earnings. to turn tax Turning for our our operating balance quarter had insurance million our $X.XX the were a for a segment, sheet share. solid quarter first $XXX now generating

That's that not the who balance we'll perspective. our It's volatility, the market actually of profile. sheet are increases opposite. periods During some risk hear quite our concerned from

a we it'd attributes differentiator balance is and one of believe So be That market be thought a with having true. a dislocation. sheet, of what during ours we especially worthwhile to periods the meaningful positive real explaining

liability source unique sheet, the balance with real and of we begin is Let's differentiation. a think side our pretty of which

our and very cost average fortunate XXX% fixed. with is Yen including average weighted issuance liabilities. approximately are XX years a long-dated of to outstanding, recourse that coupon The of low about to is coupon debt access maturity have X.X% a recent and our of We

rising is risk, to our no after-tax we have of calls, margin have debt minimal rates. exposure less around no So duration X% than risk and we interest cost

to side expect, which for balance deliver exceptional deep has sheet, as terms results of have helped the allocation In of shareholders. risk, our we very our a you'd asset commitment asset

its Core help sheet duration what private strategy. the we on how allocation fee-related equity balance Over sheet the we ago number annual the a It's investment a one, have great core we portfolio, the been one KKR's decisions was layer returns around of of last years earnings, used well representing management and And important largest business of today, and our as launch believe contributor as we as of have example five deeper balance business. private is long go of equity strategic we today. years, create a fees our kind our and three a made and an to the key is XX% the largest XX% respectively. XX%, to

decade. plus private to teens expect extremely these many of the that our if equity a is or believe reason they well, we profile of XX% This We to having carry traditional period north IRRs positions, These our more a for a and a the billion. outperform X% including in tailwinds a are right has performing compound equity can real our businesses the go real stable X% core was inflation, result, private attributes in equity. a solid and sheet of believe plus and income gross QX profile. XX through portfolio more balance for flat with have years investments $X.X volatility key we for hold market from to balance we of core dynamics power. cash risk was and investments quarter, pricing sheet portfolio. flow appreciation earnings defensible And fixed and accounts our We're modest strong in for return believe indices, we portfolio benefit XX Today, compared to mid-to-high looking as with secular

would as time that private the global be not core and our business our compounder balance we support markets. We markets access be because we asset but we investments overall sheet, Now, debt also because stable long-term entered to leader the it's in PE only highly to had for were business our management, model. it equity, become ability thought with would core synergistic that a they these capital capital both and equity able over confident a

of with PE the put continue of we that strong we've number able from of fees, global capital, also to business management which our we ago, the return and that $XX we data entitled carried interest scale to us which third portfolio, and And billion from world the very growing, a since which management an XX duration these AUM to with and core with been every IRR this are of together companies the now in capital sheet party franchise. annual a So QX. a earn is five investments, gross incredible allocation standing have largest clients, believe balance start years over the long inception have XX%, together alongside the over gives we'll we'll we be confidence asset earn

generated in reflected $XXX performance approximately of QX results. which million alone, we XXXX For is carry,

So and capital portfolio have for be performance. grow one-over portfolio activity revenue very over generated transaction deployment alongside time approximately to fees markets opportunity compounding, performance-related XX% core a as with of couple last companies continued the can expect and of it. Moreover, our the the years grows, we'd significant

leading our and has the level incremental balance as manager return So base on more management characteristics. and well capital creating exposure markets recap, we asset combination performed able we meaningfully asset well been augment to fees stable a sheet And therefore as our by have the revenues. that return extremely has have carry becoming and created in an to of

diversification XX highlight think positions of being cost Given with have will will of the enhance their balance portfolio, XXst private this will XX scale value, largest decided help fair transparency it the of provide our XX-Q top quarter, enhance with and investments, March equity our In increased performance we balance and this the to investments. and sheet instead sheet just as our portfolio We our of beginning this core largest forward. of going the five positions, XX disclosure. we

we to strategic where manager, Atlantic the Global purchase Japanese without were announced recently price. capital in all Craig little where in we the capital. we of we provides base of liquidity especially current the dislocation. think really that of when a shareholders, equity price the these be of additional Between alone, XXXX advantage best any first this of earnings right of a without We and equity. Now, would of dislocated the like able capital limited to would with This and all of there's pursue sheet early XXXX, generate of issuing trading base. off no now, billion excels. able the capital collaborative turning required market would've our benefit dilution And environment most that, and fee-related strategy in relatively investment from it connected broader balance to hugely of risk way goes evident the highly outperformed. pursue that benefits markets of we severely our And entirety markets this year million where finally, to The next is acquisition there's transactions love business our access strategic And $XXX periods acquisitions. capital coming valuable back Having I that. perpetual funded We dilution as REIT these. north huge firms source expect two when bet is a this particularly obviously of type to model the to achieve example our we was half to $X.X think given in well we understand of as been really mentioned, this we value

Since wXe're XXXX, ROEs balance $XX.XX. or at retire, using our buy used same back of we to at own high to and really the So building time, shares this used while $X.X million additional a we've weighted sheet our business all FRE. sheet inorganic billion average generate And stock. balance activity, while repurchase creating price to supporting have XX the

to of and overall hand helps environments. enhance different including outcomes hopefully Scott. context balance it that how its off additional that, market some that sheet, value across let economic the strategic me With So examples provide around can

a and been last process It's since call Rob. there's more three you, uncertainty and certainly dynamic to navigate. months to our information Thank

of environments anxiety business is While apparent. times like exactly culture this more most, like are creating strength this, it for the model and when becomes our

is investments With costs companies pools and the readily our at and are information The these not want connected dislocation right incredibly and culture solutions find information. of travels down capital better more we more us firm acumen, of develop sense need potential Our sure result excellent make capital. opportunities the that what up, for is during apparent and and making clients times our of special. for understanding another returns like way, occurs, culture get you and environment. makes for and well-positioned clients even when real this we a an higher have Said the investment valuations feel

We powder. have dry record

We have us. clients that trust

We multiple businesses growing globally. have

sure of executing regardless for next. culture today more our this ready sustained feel to I'm economy, the near we to but means, will focused we connected talk We about plan what term with speculation what's macro With have and questions. and November. your the inflation and about we'll five-year on all we happy we shared strategy the you that, confident remain in our achieve take rates, and we're

first [Operator Blostein proceed with Please the will Alex from be question coming Sachs. instructions] your Our line of question. with Goldman

was we fundraising morning, Good Thanks. with I could comments. everybody. start hoping

For and the the some quite a equity affecting couple It lot, guys as given Europe of be the crowdedness comments lot the of to talked space. is about latest obviously well a and we've in fundraisers a whole seem heard your lot last months, private going well. you on doesn't

of probably fundraising with to are to what you OPs that's us own it's challenged you of hearing you become next while respect and look but XX could out to efforts. help sort months that I the from So the generalize, well going contextualize for areas can maybe maybe some XX as your understand hard more

of heard same Alex. regarding It's have comments Great. Scott. Thanks the for the you environment. question, We've morning. the Good some

why color of on is We're you really the dynamic, what little let this we're but impacted being right. by It not and seeing case. bit a that's You're true. give me

than market bit come institutional some from This seats and is seeing they're investors. a traditional GPs is a and crowding particularly of that our We the back to LPs faster true from are effect. expected around more hearing the

and So investors classes. from it's the wealth, hearing that not defined not also the alternative hearing think in traditional some We're some importantly, in private PE. funds but of that the class investors public sovereign proper. about other We're newer asset alternative pension broadly including equity asset

our raise -- the of XX the from private raised $XX So and funds billion reminder, first $XXX point, a our months billion our flagship the we from equity last quarter, couple all in we years. advantage almost in as over last

for billion $XX over bit a it's that fund cycle. So

market equity private we're impacting any So just today. crowding doing is not what

look this real rates of raising and is up rise. dollars the infrastructure raising interest. you money year, we as as and we're inflation at where we're of If a anything, we're credit, most interest investor If where go seeing that around estate, lot have

So crowding interest the multiple wealth before and from entrants to insurance quarters. we're experiencing dynamic and increased the get really all about new and for we've even company prior that that's not that reason you private in talked

We're positioned. continue us, like kind the plans and we credit assets of We're could see, where be negative. great feeling now, terms So we're what And want right about of impact little real question lined your to road there's feel changing our of you a against in nothing not the kind up well that to about bit and for how that. we year. down do we're

date, that's looks back expected. north year. the you you the a and And see guys performance, wealth pace some is than of investment strong Thanks there. are return on year has of my follow wanted I X%-ish on last little in Great. crust slower bit, maybe your you to that. around guys of [ph] XX% out continue up like to build would've The for in mentioned us really and kind of channel up Scott, been are

and out it that in a you you and would to wondering growth talk little faster? be platforms product for some of So getting if crest that it hurdles take scale on what accelerating bit to can facing and might perhaps the

to democratized class. our And Alex, tailored products these Look, this data, -- really think etcetera. step invest Craig, even massive before the we're of take overall and to begin. wealth why we expect interesting asset Hey this across a we marketing opportunity think classes we against to start? I over introduce we we're of do really positioned alongside is don't digital all I to back continuing asset don't democratized private within talent, just And and products time, to in really well this, sales, why have

at tailored multiple the a broad we these we today more top We've So individual platforms that, They're in They're for are got aggregate platforms. tend where and on democratized do bespoke basis. we solutions. to of three and look on solutions.

Looking habit want $X.X have of across get the these giving about products, to calls these these. don't on billion AUM in I all individual on updates and really of think we we of

exceptional we've overall track to the second think think got you long-term is have I want to great this record. brand that channel a we one, none, takeaway we that in is an

I some innovate all think ability we track product to think again, appreciate that in we the noticing. can from records We these relationships levels proven you're with of and that individual have have be strong distribution buttress a partners. at product design

progress So it's about great actually exciting and the feel long-term a opportunity, we made today. we've that really

Great. much. Thanks very

line Our the Morgan Michael with question. is proceed with from your Stanley. Cyprys next question Please of

Thanks Hey, the good for morning. taking question.

portfolio little bit update could so talk about that companies. on us if could EBITDA given environment. going your manage what of companies about supply across from see you're little how through rising your your just portfolios. a revenue And inflationary could this And you you're impacting backdrop, on sort bottleneck, chain how trends you talk growth maybe a we're Just you you bit helping hoping everything and rates, seeing just portfolio

question. it's the Hey, Mike, Rob. Thanks for

home inflation. wage short as looking inflation on there particularly the is as related to ownership on an focused pricing certainly on seeing creating others, just portfolio is bit. I to know US, across to years, last portfolio especially global energy way supply, today, CapEx obviously that the years. millennials last things the our stickier on stickiness three think a and There's environment. our continue going In, due that which is watching basis. And is labor that we're we're supply there. the put pressure into underbuilding understand XX One we're now We're a are seeing you quite housing over like availability across prime thing a moving then their So, in we're

Now, on share other XXXX, this lot and so best inflationary in going portfolios broader the of of potential We continues that on for portfolio. is around in we're about years long easing across we side expectation that as thing one good really definitely rate at on our and our we've inflation a practices. is that portfolio X% be in do our increase we're work work lot to doing about right see a going calls up a into that to hedging, X% given to time the, talking forums range. look the now chain for heard the XXXX. into There's how Obviously of an forward. a potential feel these these seeing would've interest moderating We supply set rates period you has gone trends. us another we're here across of But,

underlying at continues how we've look growth revenue the exceptionally and feel to and overall strong going with good you earnings really As positioned portfolio portfolio, we it's the be forward. across our

it's Michael Hey, Scott.

add things. Let couple me just a

this years. As we you thematic last approach the have several know, taken

at is the things the that been we the we've point besides past inflation up. specific some would of focused show very of in One we knew themes some on discussed have

have pricing we're terms that in of we the them of portfolio And And see part have, of happening is They that in in kind the perform the well. power. we scale portfolio to get ahead the companies, and of portfolio kind performing think we're seen information seeing your I the specific quite procurement that's know been and the have what our addition they our helping chains. reason we've that's do to on making that investing that around of well, of able be we're the helped focused the in very So use question traveling. to supply these you you've sure that real to I about markets all can programs and is things businesses think how other some thoughtfully, information access what is across world

and of backdrop. we despite stats Our the of in trends revenues lot doing continue in a very XX%, to year strong quarter, the up XX%, last parts through we're macro EBITDA what first see

liabilities should then at rate rising look the of the of for rate how there risk that? GA, portfolio environment? benefit, question, of about the how a And Is parts up in activity that any in Great. of repricing help a just could help us terms understand you think Maybe sort you portion timeframe rate about just just your how on as and hoping think could rising different impacting credit, us business. book maybe we to then we the customer credit around see maybe fixed of I rescinding around rising frame there follow and is of side, rescision sort do floating in rates, you was what for rates when higher the rate

good Mike. All course. of Yeah, Thanks questions.

relatively a we of cons environment. obviously and it as balance, there's we're But feel relates on pros lot So, rate pretty business to positioned. a our well rising across like

AUM AUM we've of leverage credit our private floating is Most credit a You reference very also of credit that rate in nature. sizable is nature. in our business. Most rate got floating

And interest our as go so fixed. products, rates of go up, returns our And are know, as will hurdles up. our you most fun

goes of likelihood the earning up So as well. additional incentives

there's is impacting your of but the takes, rising liabilities can book value the and rate over a to value Atlantic you certainly income rates environment rising Atlantic matched your referenced, positive effectively you at what a so look very and assets, as net Global liabilities assets interest offset puts rate in fixed is largely we rates well and and are some our rise, Global and On Global see as in degradation the a time whole, at rising the Atlantic think environment. and we

I of in to volatility about on $XXX rising in a of come note prepared than KKR in the think sit at as we our us a ourselves to markets, this I after-tax remarks, less structure. foot that's think own then relates really all liability potential environment, of time. it think reference important the allows a for on point and and XX-year for fixed I across firm. powder us, this duration think this rate to other at across X% debt. nature our the is we of That's through set our record increased about thing dry period that billion the KKR investing multiples cost front a I think, in to kind be And last capital We've up down number

Great. Thank you.

Thank you.

proceed Glenn The next of question line Please Evercore. with with the Schorr your is from questions.

Thanks. there. Hello

a a and the transaction considering good, capital pretty in resilient worse little question, environment. fees the got markets markets, darn But April. So were pretty

So just if and diversification talk fees, like piece but feel Thanks. it's could people as good, it to to be something. it a expect good, but is management I you tell like of because what component exits discount down, I deployment a seems resilient more than us through, help wonder is big

Hey it's Rob here. Glen, Yeah. I'll off start

is last in or markets, was minus So markets our of quarter $XXX quarter we talked revenue plus a functioning like felt that type capital what a this on we about normal million business. call

just our our able given pipeline growth. forward we transactions our but number well. not last over its what's years in firm what third plus to growth those the from quarter-to-quarter the obviously a of areas of income fees, our year probably growth QX think to I last share we're a generate to on I QX there's bit, franchise, is of and mistaken referenced that are a expecting side to as number follow of important KKR's going to seen, you've this is of be with like talent we and model well to opportunities that a transactioning QX of were pulled in couple private in party in believe take the but core in we think business think that you durability the mistaken clients that to bit this as were of Now QX come loss different year areas got the year, continuing across of and your lot access a continue that. And going and growth and equity variability this reference highly broadening earlier, not things both, Probably prospects. potentially durable and I with loan of I more little question, as a

And and continue invest lot over we to so see we're growth behind next the think number we about very excited and that a as business future, of to years. the that of

That's great.

during $X you billion said with said Something the I you was interesting fee. ABS an think deployment average prepared on

that get going do terms the increase that So ramp give higher I contributor up on increasing steady the big from have ABF to? that? be a and of coming expect basis, both deployment a is and in can fee flow -- how and to to just growth quarter curious a you're is of you question on I'm

don't Craig. Why Glen probably Yeah, here. that honestly, spend and time enough built we've talking we start? it's don't about question, I for platform the Thanks the

So, first is market. a taking a step massive back, ABF

comparison, X.X a years, the five the in it's size it's by, plus market. X.X yield expected high over in X or is So to coming to four trillion and trillion market go trillion

already much that about part financing multiples better lending critical like high a is we're look a in market to prospects growth So and talking market. with the of corporates, market ABF leverage yield plays the

financings, honestly, entry lack scale view, have our alongside cards, of and through you So finance receivables, in equipment of barriers operations capital. is leasing, a it's this and mortgages, massive credit market, have day-to-day high what etcetera helping you to

way we're time, diversification So regular return at top the regular from attractive same traded the or away finding risk we also of and on credit. like away

in terms of during as of looking remarks, rewards. pools capital prepared One, risk and we our in the we're we us different approach, different for of three noted note. have things So really

Atlantic. private Global funds the in credit that's the from to all BDC way So

market huge. So the is addressable

materially. available has Our increased capital

this And why point, your ramp deployment you're this so in seeing to is us. for

is second The point we've been busy.

last quarter. exceeded year billion, So this including deployment GA, $X $XX billion

is globally air those access. this platform are as becomes difficult yes, and financed us important, overall So third, grown, is a from this area platforms to or otherwise folks really are for again, who view opportunities, XX and partnered this our with so has credit originating and interesting that specially the we've

over return. have employees billion So industries, helping it's of attractive these $XXX access platforms AUM. they're us across X,XXX global, a and They're risk

built think the allows to forward platform, when us we again, we've confidence which have of unique So origination. this

No So it's part growing becoming a question. firm. the interesting of and

it. Appreciate Craig. Thanks,

The Bill question. is line of next receive question your Citigroup. from Please the Katz with

taking a Okay. forward the questions. Thank on. Look through much to looking later queue for little very you that bit

pre-dramatically the a have maybe you've quarter going talk little could of sequentially changed you. where terms in In about deploy course opportunity the opportunity new impact since the speak to to Thank was net and activity for date? can I outlook. into quarter, even that decline bit the dynamics if wondering private within little the to to seen second first might quarter you the how a maybe realization the you carries period, the then accrue monetization equity and bit the And

don't Craig. a Rob update and I on then Bill. look, Thanks Why start meaty and deployment will the It's modernization give is deployment question.

of tricking rates expect being us some have rate all as this So banks of outlook central have for And for inflation economic with balance they a for hikes we you of their that interest front in alongside growth, year sheet. mind time. number

So against more expecting volatility. these topics, we're

So, implications we If to of need one firm, we are to need be connected you be continue what as thematic. as a as this? ever, and to the

One, you've heard power. of So couple earlier, of of and already a Rob terms from but pricing for areas what focus get said us, long this in Scott thoughts.

So think costs, two, power, cash with advantage. flows. shortages, labor our collateral-based own input we higher with Number companies more pricing

can are that with real keep investments GDP up So assets we interesting. believe nominal

prepared you us. with lens When So tends that's equity private a look real and often you deployment, to again in us it asked remarks. heard asset about at estate be when for based private, finance infrastructure, we're the

equity look percentage well you private a both quarter, last firm as deployment, and in So if the as teen's as our has year of in, a percentage. been first

increased, as deployment. of so you've us the seen breadth the firm's terms assets greater for of materially And these real in become

in private are market. and automation of in quarter you industry disruption deployment we markets in expertise. private our innovation this a And and of year. build Three, assets, midst we when spins for you change energy Four, security, of increased in the XX% lot cyber, think lens an boom technological And ways we're who have real bring through where areas deployment security, a XXXX, these markets in standpoint savings areas digitization a data millennials in of many to continue. billion want then in five, all payment, first real the at a net bull including look terms we're of savings Asia, unique families. a safety XX% deployment of the from assets, So logistics we're in

retirement So just occurs, I'd other a that's products, culture on dislocation for culture these allows benefit. something think and apparent really that real the and And foot sense front and and reinforce to connected that nesting, acumen a periods. should allows we some become less for and like stay but, companies culture and planning, means again, connected Scott you this solutions our relates financial all to we and when get in themes us I us wonderfully that a wonderfully on, have touched we our that have point had touch would on in think I to this that's culture view be

Hey, Bill. It's Rob.

around on up me Let returns and monetization. your follow question

equity. You referenced in our private returns QX

put up PE. XXXX bit. that for context in to were Just a XX% We into in want

the a quarter, times marked at still five XX/XX multiple over XX%. traded so decline. money, think XX% decline, points, money gave a down XX that position still but points months, of the that down as portfolios quarter we And about that in PE five that of was And chunk actually represented at X/XX back investment of quarter, and XX on for fantastic up about the last in QX, had XX we you our still us times at good multiple a marked about at about on

now, things. plus signed feel represents monetization overall either around that markets a our to healthy One, couple based we or the very into products, so deals feel about. right already we of about good have that line revenue terms portfolio talked revenue we where head different happened, that transactions the KKR's line the QX, or impact from monetization, we underlying of that global sight of and nature, have a this equivalent, to we've And of breadth on you and we through saw overall certainly relative million in today, to of number pipeline, LOIs as two, $XXX portfolio are have monetization you're QX about. of our just great volatility In and and strength think sight I we that

income. these terms given some risk And some of XX%, we're say definitely of color I'd I numbers Now deals revenue, time, that helps but of at there's upside and the come of would that happening, assuming these balance like that able these in referenced ballpark Hopefully numbers, about as from same the character performance well. provide in realized strength of to the realized then would achieve there pipeline, to revenue just all there's come Bill. some revenue quarters, the from a investment bit

slightly been with insurance a for just side. insurance house the in then you of you all in, is not ownership to sure whether just maybe guess between about good budding your a split I Can chime of to but follow in or your I about Rob, want a business, that might there's that little a a how a sheet or as you peers having different result? or there's some appreciate the pros as And Scott, you. might regulation in were helpful. if sort talk see that. a bit Thank I'm you bad not conversation risk up, GAs surface thing any super you That's any around that. cons opportunities some balance regulatory

Rob. it's Bill, Hey Yeah.

What make industry that transparent Atlantic no and sure talked So gather continuing regulatory with and are we're community continues Global have about really we last Atlantics know to close feedback, from information part I'd a relationship its We really with update of is focused us. a to call. that focused on regulators. we bit to Global new the on say want that. this and

thoughtfully on made that the to other behind Beyond model holders. that, ton anticipate to business changes can don't the a long-term we've that that say promises we many of there's invest comment policy we to not trying really to

its constructive and very Global continuing around on future. Atlantic in overall focused of the again relationship transparency are feel we type so, the And that regulators with

line of questions. The Mckenna Please next question Brian with proceed JMP the your Securities. comes from with

for And you in Great, back updated years FRE XXXX. plus in to XXXX. at you're thanks. FRE, noted you as $X the $X.XX target rate run first If five we quarter by annualize or before, a November, your

you if approaching year, So five-year FRE forward $X willing timeline are all? you're this this at to move

of our a ton a question. Rob. It's is we spend how honestly near-term time business. manage don't FRE for lot we not thinking Thanks target the about, Listen,

short we firm continual what us think so And hopefully the that what I you're I FRE you tell continually what we how see business where would And around get hopefully the to update update we will on see is a today. you is trending. across from But in is very less have term. likely our going of you've our level we heard from excitement us

have than today much so six XX more months ago. We we momentum had even or

from scale exceeded of had many like they're is a the the products when and targets sitting last floating six many We're or underwrote the markets market I capital at that our Global the of of XX to real look to years momentum XX the over transaction infrastructure, lot the which estate positioning we secular across course we're perspective of credit, mentioned next months, areas have poised to we've much as And in market where for Scott real that well in a You than we better rate where seeing growth. raises we've are those. XX product over had close fundraising areas two months, ago. referenced. likely Obviously Atlantics growth business and big

FRE bit growth. color really providing updates FRE So long-term near-term targets. helps you hopefully our And for around that, of give expectation continual and with a is little that robust

tendency you a historically, only view The if up, of we've outperform. a look when we back might kind Brian where Yeah. we've I'd to had to is shared color add as end

that continue to is record. intention Our

past about carried about years, And it. traditional your Helpful. related we How several that products how should equity much think Got over Yes. to $X.X how that strategies expanded and time? the you could then unrealized to newer billion evolving net tied the mix over mix private then have of talk interest? of is and is the meaningfully much then

towards private say our in good infrastructure today, much climb in equity a a our carried products products, our real it's I'd estate to unrealized but you are still interest very starting it's private our question. in weighted much particular. mix as carried of real equity see forward look Yeah, And of regional we and traditional we credit that our realized and can certainly a business. infrastructure parts percentage about as estate we like see think become higher coming to and time, areas what over interests from

guys. you Thank

line Patrick Autonomous Please Research. Our is of the see with next Davitt from a question few questions.

maybe my few Good have in walk AUM and over asked. the KGR Most you of Could morning, periods? impact been everyone. growth the tracked questions has through of its organic how and the particular last economic also to earnings maybe frame

Sure. It's Rob.

our AUM, is incremental we've that's market, a perpetual at close opportunity franchise I what to opportunity of franchise for the in capital opportunistic We that exchange we Japan rates, billion real to to Japan, the in strength in core well as all our lot of as benefit the their franchise see the grow that plus of REITs team $XX-ish in a markets Japan announced region. to So Japan. see and leverage think managed both in current

well up setting business as able from transaction. So our to refinancings. regular we strategies able make they as be support a on or in those more markets acquisitions to Japan, And capital locally this pursue believe the raise basis, sure we're quite of as a we as should result franchise we're that to lastly, capital

a we implications, million that of to basis. able expectation be In deliver should economic the on set incremental platform FRE XXXX. that our terms is a We what of from $XXX synergized in is around

the Great, thanks. And organic then growth how looked? is

strong trading they think their at had launched really been and has level a I to It's book things, nice as done One, market been strong a relative couple and REIT, they've good flows really well. following a well. which have organic second the

started together. that business to ago me BC all UBS is by [ph] that and was this a long not So

their nature. organic been it's really so And entire in growth been has

what in that of that two is then follow view? or XQ close on Is up one a kind $XXX you pipeline. And Thanks. million to the Great. quick expect quarter

view today. a have on line based sight of quarter that's on what No, we one

that So QX. all be would

Great. Thank you.

Our of the next questions of your Siegenthaler is Please proceed with Craig America. question. Bank coming from line with

morning, Good Thank everyone. you.

cross But a your in China? over of the especially real looking few was term. China big in I strategic looking including merits the the the of Japanese products I Asian So also for also, then union is between know were pretty following some your have given acquisition, fundraising I you faring And the for West what REIT sell. of REIT business, how really your near decoupling And Asia business on what Pan a asked there. I questions is was And and state the a acquisition. pipeline Japanese

not I'm to going the follow just up. So ask

Thanks way. start along I'll in will the Craig. and Maybe here Craig chip

terms just in of about talked of In AsiaPac business, we've union state prior the this to our calls.

consistent We the as I have acquisition of we're business think big very theme. every US time, expectation AsiaPac that investing over business the be with overall as our Japanese and that is that and much behind will REIT our deal manager

Just to around it. numbers some put

acquisition, of had for close we're XXXX, billion AsiaPac. end years the of in proforma plus the we about AUM at billion. think forward $XX $XX Two to I

of So a almost AUM in of tripling period our a time. short

able we head start, the a that advantage got drive to real further we've in got to talent we've and have to opportunity be we to competitive I of growth. of take region region across the the access, think advantages really have lot a

double both In of Asia. was scale our short second a terms in well as on be estate be investors. private different the access We want piece in got the in We to largest able avenues of lead real to globally. able wealth and the AsiaPac really perpetual reach market strategic in and honestly, of really a to Japan, to acquisition, down ambitions it at capital conversation. business, to able the merits that to want more world firm, real be estate to the We've as

want of on… was it. to you strategic evaluating we were so as hit a ton something sense Craig, perspective, And this made acquisition, from really a

complex couple investing China become we critical think thoughts. China, has look, to have navigate to the on so a right One, Craig complexity. and think in in the more of Yeah. I it's resources order China

it's you like -- to help to our best have in important a public it's our think think specialized we local So you need resources class complexity. that like We but global affairs team, team, Institute more. need navigate

continue think engine to critical global be we is term to So China going of growth. a long

skills it's differentiated bring market, we So unique very to approach we important market. a a question. think and no And that

Now, I been think a domestic where like when behind has themes at been you we've of consumption. look investing, it lot

a and modest being to want well to leading when we look we continue think committed we're a you it sense, significance local positioned investor remain to quite a today. given leading we grow firms our to our just help you prosper the give in firm, overall does to just as China. firm at and domestically And and remain of a exposure, So breadth

our over AUM little a you are investments give China probably, X% from of to scale, So, of in AUM a just standpoint an sense

Craig, That perfect. Rob. was Thank you.

you. Thank

the Deutsche Our next proceed questions. question comes Bedell of Brian Please line your with Bank. in with

Good my on well. Asia as Great. Thanks. was morning question folks. That

detail. So a that's Can you that think good hear -- was I me?

yeah, can, We

Great.

I'll as one then well. so just Okay, do

about management on FRE the just more how think Craig, if with creative the inorganically enhancing prepared ideas and thought view that grow what like maybe to what I for KKR, to but related -- within private pipeline Going talk said important to you as acquisitions back enhance is you the maybe in a can earnings you other few doing wealth remarks process?

take Sure. I'll Brian. It's that. Rob

our first measure ROE for time. best anything to at evaluate to we sheet, period long highest look and the is drives when the balance we're always going over So of what a be going that

saw. our Now highest distribution, track businesses you those we're make asset where and to Maybe going they ultimately can make the help drive our a help and brand access we I we given situated, better. our us think activity ROE. And how what that's, there's with better. that's what's to think management And inorganic record of lot can

partnership the last that we've what week. in Global multi with of years. Atlantic, different with we That's examples you the and got think, acquisition saw over closed our I

be continue and focused necessarily anything that a the done, not certainly call plus plus to But an from an that dollars primary be that leverage we've times And point should we team got going in that's side focused a lend to that's the lot here, is very the going FRE And we're four so can TDE itself on be it's but was number we would how a earlier a of that any that's -- at well, as dollars while certainly of much as that we basis seven growth long FRE ROE FRE. driver on so accretive organic of we've inorganic the out inorganic something was real years. in to that. perspective here have had of seeing we KKR on to drive do that of on to think was on core incremental we a you're referenced put think it. on be here able we competencies the going last targets had to term, that it opportunity things we couple it transaction. inorganically there and to The relates over of to the really last

of look you we'll balance outstanding is allowed with The that some using minimal we'll updated volatility. issuance bought Square, we what something dislocation have us things remain to you Atlantic, if the those just if minimal think the of that's our some back the Waste, only but opportunities was well, been weapon. Brian, XX% active there's we're inorganic to would get J-REIT we're time keep since billion And of to the and with as AUM continue of has you buying during point equity we've I not that XXXX. a And trying also done with sheet about that that dilution to is that what while where balance I add shares equity back, listed as Global pursue over say Marshall I on, sheet that's looking lot talked about it, or done think Franklin at I the Yeah. across core, thing strategic periods $XXX trying think and

great Thank you much. color. That's very

you. Thank

you. Thank

question. question Paribas. the Please your next of with is BNP Our [ph] line with Arnold from proceed

Thanks for morning. Good yeah. question. the Oh taking

maybe Just generally certain about a question. follow in corporate on on the a wondering side, market bit given for more you challenging IPOs. what the you pipeline level? I'm seeing the up if M&A comment on saying the the about being could also a M&A a market GP more quick the bigger in and more Generally, market are you're of of pockets potential at congested just fundraising industry general, deals

Rob. all it's weren't We that Arnold, Hey, to of hear question. able

think of at GP our the quite of integration space, to a look Certainly get it, pipeline inorganic particularly we're I corporate and relates activity in take space the a lot across is is we M&A bit to activity, and but think that seeing. I inorganic a requires hard. activity

and still, deals large given being likelihood the think crosses that at any years. low desk is while of future one able in also been line, we've not the I either. and anticipate our a M&A that able relatively size things is so And so the would these some but pipeline happening look quite we'll of a it's of been that lot full, to fortunate that bit to the and there's us to a especially over the do We do pipeline the need do for we've

avenues we we're to we're a at but where can sheet to growth, got our in grow doing going look find we position something we're can drive that. and business, think our balance fortunate to of additional really lot complement a certainly use where we've I organically if what

party mentioned that and busy been M&A a thing The are for pipelines Craig standpoint, the there are from Yeah. deployment's happening. as active, add, it's capital Arnold, private third Scott. dialogues I only public investing is if this our funds would corporate

So as that's it's now the, much the seeing pipeline right fun company build not part of be to and a we're up. public so that

not this of a terms be capital raise that probably it's a In it, idea for larger think an different in of, that firm and ways dialogue it's of firm lot environment to to such part and like makes bad the maybe I has think active itself, people and continues, invest. been win a

on we're both active So fronts.

Great. Thank you.

Capital your Markets. Please Thank from BMO proceed line is you. Hone with question. question Rufus the with The of next

come good credit hear I balance Great, the it seems the and morning. for your investors given sheet Thanks for and you back taking you question. sheet it I haven't to yet. balance the but on the optionality around to differentiation my wanted comments offers, many like full

balance some So balance credit consider pursuing over size long capping point at give the doesn't the you market the sheet term? other options? strategic the If would you. for Thank of your you or sheet

for Yeah Thanks the Rufus. question.

XX% as sheet an strategy. is that about consider on employees to an think KKR. I balance first you think our group shareholders aligned largest much in thing strategy of firm the KKR are almost the very of the it's

inside start perspective aligned to we with platform broader capital sit as opportunities the we ROE ecosystem drive from KKR. and here of see to a So today, very that and leverage we more KKR of

that strategy. level And long of over capital going ROE seeing that the additional all extent where then, return, you're base benefit of To on shareholders, then to strategy, the attractive create we in different we a able of time, have the drive that that able we're we're shareholders the see we're and consistency have. we obviously we changes virtue a and that capital are the that highly but convicted continues as way accretion opportunities see to we for long-term by here so as that base sit not we're for that certainly today, operating all might the to

quickly $XX the capital Yeah. as after a that we next more next with I'd we we possible? and we of market about given cap we model third thoughtfully quickly you alongside, as greater the taking? the that as believe $XXX have with billion job billion double is sight cap our add Rufus invested the we have party that built about get own the create market confidence. is and only we of that And and line then, as the plus possible we're risks How capital do of combination can thing how double do if price the think stock our think to The reason that

we converting the How it no, There's that. where the that cap we billion we've it's doesn't of do acquisitions balance question over is, and forth, we earnings. making billion and we're market that express do but, we cap buying back so really sheet, lots if view the been different lots into answer sheet from. way from no, $XXX market things strategically the of the that that's but our planning can things on of model balance with stock, appreciate to time, have been we to get $XX coming not the do that to We've do, can So certainly different fee-related

as quick a you. mix And extent? any and thoughts carry rates follow between FRE to the Understood. up, compensation a greater shifting around Thank

is short the answer Rufus. No,

the I a than that ago. year structure think now little more bit we about we put feel compensation in a good place

shareholders, that our us our in think I think it's for our sure between balance working and we've employees, got right really we partners alignment limited right right well for now. firm our the making about place and is

Thank you.

Our next of with Please your with Chris the Kotowski question Oppenheimer. proceed is from line question.

and to Yeah, energy good natural different have have if four of state Craig's similar something wondering or approach could your of None an it has union place ever be decade wonder of morning. And to energy on a invest the I fossil obviously were whether had sector we last the people investible are dedicated most resource the overview. funds. like I fuels be been investing of terrible you because, them again. and would for formulation just

obviously thread the but the ESG wondering, energy that them you capital can big time, versus I'm new investing the you as kind commitments and to I transition road navigate fuels explain fossil at needle. there, you a need see between there's rules of if your got to of in guess how and Now plant same you've

Sure. Why start, Craig. it's don't I great Chris, question.

and So energy. to we're in investing at clean energy level, the a to shift committed the high look transition

of range energy diverse in sources. invest we this, reflecting a So

touch first So let's on renewables.

as energy like in and this been of areas strategies, increasingly we've active a impact including think, us developers So you've really well, clean across space seen operators, our infrastructure business. and that number global for

increase Crescent in It's cash standpoint, is free team It return it that excellent has send over of ESG the opportunities. And Crescent positive, low significant percentage that M&A Crescent is vehicle from can real best is business. an class in receive management that's think real conventional eligible own its leader based a fee an capital we area We we place. permanent alongside and business scales of the called a flow addition leverage. on a Energy. can Now has teen's done being as think equity fees that there's interactivity we become a total Crescent in here in operating developing And of really energy value. equity through programs time a that to creating in

So, gives better that you approach. Hopefully sense. that's overall our a

placed I fossil fund. Yeah. the dedicated a idea or… idea has And of about come who's and just that like was an curious Is of that fuel traditional market gone, the

it lesson Crescent, a I this history Chris. and think perhaps bit around honestly, this is little a of maybe into -- a gets

was that that, assets through and Independence entity were we investments XXXX, it December an entity or ENT Energy months those energy an company formed contributed form co-investment called XXXX and public saw in we that in balance a in traded some of merged five with sheet, was with what and the we six growth combined had together So, from energy client our Independence investments insurance Crescent. income and fund you then Energy. ago, was And from that to

really So the teens of and us. what for dedicated of own $X.X percentage, step those cap next billion the Crescent it's is next market is, Crescent a is but Again, we a company. funds evolution

we our Crescent. be So views and that's really our expect really, is the -- focus that's through will how

Chris, fuels traditional a Yeah, fund. there's no plans fossil for

invested through around investment Craig every make in in lot to -- that more the private asset-based actually and haven't across XXXX. on conventional on of in footprint our have since that. as great infrastructure, doing doing we're focused is And renewables We and the then a GA otherwise. we're through work job fund gas ESG plans a they team is finance Crescent any and conventional Don't doing really the mentioned, side oil the improving and equity

So the some focus those now. of are areas right of

for you. it Thank That's Okay. me.

you. Thank

your Fargo. with next question of Please proceed Finian line with on Wells is Our the O'Shea questions.

type if across rollout updated today's relationships morning. Mostly the for on in and good private ideas answered us asked call channels? progress But retail upcoming on you progress, haven't do Hi, you any for have as wealth well. highlights or product on the me

third wasn't ago for the positioned look the again, market. this we're from no a built the it So opportunity. that term as announce individuals to it Reflecting Rome to we day that outlook to that the think just It's just raised again, term we're we in a we be point our opportunity us. as and couple us the a products be in exciting innovate incremental that this or to relates our a of channel. new ability this at we brand, enormous over we point in the and our a capital change firm we to we record, But half democratized actually view, how and investing that against have against product takes Finian moment of think we and is feel about asset long all great we've made. position expect and have said race we've progress when really have, that design of all track think areas of products. classes to going Nothing in we're to medium of right in at for new of view really time, relationships quarters across successful capital

Thank you. Great.

Our final question just with comes see questions. into with Robert KBW. the your Please line Lee of

morning patience all with for Thanks this so and much so thanks your much, questions. the

had which a but think build on, your traditionally across peers segment, or business sector have it the for place for a Can industry many you've not that peers. in to remind or solutions and a just interest just be I to you been focused hot capabilities either started is secondaries So seems if you've acquired of us has you one of, one. quick organically, last Many will.

potential us. better, to a can in we've we we a It we've three for a a to space is got looks if yeah, of the that a help can got type up across space. management inorganic pursue quite future certainly that earlier, our them we and they firm the large. and top certainly could mentioned perspective, addressable Hey Clearly look of secondary different could be the It player can work Yeah. from got different we've team asset be fit we sense. got make got the and Rob. But make opportunities for as sub-sectors not be us. sector, do need to in valuation find to I it's us that of to acquisition a the firm in is line lot at. we've it's But is our continue conviction to a so, better we help conviction be And that within It of to something going three that part well something which player. going is require it is got, as top makes platform market

but keep to our on updated we continue we'll are progress of course right thinking and so you where our now. And that's

Fair for morning. this Okay, patience enough. great. Thanks your

Thank you.

Thanks pleasure. Our

you. reached to management hand for the At end question-and-answer closing call I'll time, our now the we've this Thank remarks. back of session.

to and many and update if XX KKR. days patience up this forward with Thanks We again. your of for following so. in your forward or you and everybody to look time our you, next we not, you Thank giving look in morning interest directly our

concludes conference. This today's

lines disconnect participation. you Thank your your for You may time. at this