(updated with correction)
Oaktree Capital Group reported assets under management of $98.1 billion as of June 30, up 1% from the prior quarter and down 5% from the year ended June 30, 2015, the alternative investment firm's second-quarter financial results announced Thursday show.
“Low interest rates, ample liquidity and a search for yield continue to sustain the credit markets and buoy equity markets, creating a somewhat challenging investment environment for our counter-cyclical investment strategies,” said CEO Jay Wintrob in the earnings release. “However, with our record level of dry powder, experience in navigating market cycles and patient, opportunistic approach to deployment, we are well positioned to continue to serve our clients' needs.”
Oaktree had a record high amount of uncalled capital commitments of $22.8 billion. The firm raised $3 billion in gross capital in the second quarter and $10.2 billion in the 12 months ended June 30.
Net income under GAAP was $49 million for the quarter, up from $28.1 million in the first quarter and up from $19.8 million in the second quarter of last year. Oaktree attributed the increase from last year to higher profits and a larger share of income based on the average number of Class A units outstanding.
Oaktree earned $195 million in management fees in the second quarter, nearly unchanged from $195.6 million in the first quarter and up from $50.1 million in the second quarter of 2015. By comparison, Oaktree earned $87.7 million in incentive income in the second quarter, compared to $98.6 billion in the first quarter and $564,000 in the second quarter of 2015.
Oaktree assets under management that generate management fees was $79.5 billion as of June 30, down 1% from March 31 and up 1% from June 30, 2015.
Oaktree attributed the $900 million increase in management fee-generating AUM since June 30, 2015, in part to the commencement of the investment period of Oaktree Power Opportunities Fund IV and Oaktree Principal Fund VI in November 2015, and of Oaktree Opportunities Fund X and Oaktree Real Estate Opportunities Fund VII in January. These increases were partially offset by $4.2 billion of net outflows from open-end funds, $3 billion in closed-end funds in liquidation and $1.1 billion in aggregate market-value declines.