Oaktree assets rise 2% for quarter, fall 1% for year

Oaktree Capital Group reported $120.4 billion in assets under management as of June 30, up 2% from the prior quarter and down 1% over the year, according to the alternative investment firm's earnings report released Thursday.

Oaktree attributed the quarterly increase in AUM to $2 billion from DoubleLine Capital and a combined $3.7 billion from closed-end funds, including $1.4 billion from collateralized loan obligations, $1 billion from the Highstar III Successor Funds, and $500 million for Oaktree Special Situations Fund II.

The gains were partially offset by $2.5 billion in distributions to limited partners in closed-end funds and $1.7 billion in net outflows from open-end funds. The alternative investment firm attributed the AUM decrease in the year ended June 30 to $8.2 billion in closed-end fund distributions and uncalled commitments, $6.9 billion in net outflows from open-end funds and $400 million of unfavorable foreign currency translation. This was partially offset by $8.4 billion in capital commitments to closed-end funds, $4 billion from DoubleLine and $3 billion in market gains.

Oaktree also said that the acquisition of 62% of its business by Brookfield Asset Management was approved by Oaktree unitholders on June 25. As part of the transaction, Brookfield will acquire all outstanding Oaktree Class A shares. The Brookfield deal is expected to close in the third quarter.

Management fees were $175.1 million in the second quarter, a 7.8% drop from the first quarter and a 16.8% decline from the second quarter of 2018. Incentive income was $138.4 million in the second quarter, down 36% from the prior quarter, but a 293% increase from the quarter ended June 30, 2018.

Oaktree earned GAAP net income attributable to Oaktree Capital Group Class A unitholders was $42.4 million in the second quarter, down from $47.3 million in the first quarter, but up from $31.1 million for the second quarter of 2018.