Carlyle Group posted record assets under management and strong fundraising in the first half of 2024, and expect that positive momentum to continue into the second half of this year, despite recent market volatility.
“If we were having this call last Tuesday, none of these questions would be in the mix about the current market environment,” said Harvey M. Schwartz, Carlyle’s chief executive officer during the question-and-answer period of its Aug. 5 earnings call.
Instead, the discussion would have revolved around the expected interest rate cut and the “solid” U.S. GDP, Schwartz said.
“As a matter of fact, you might think we were understating the trajectory of how things felt,” he said. “And so, I think all of us have to be a little bit careful not to overreact to a market adjustment, which at the moment feels very, very liquidity-driven and very risk sentiment-driven.
Carlyle reported $435 billion in assets under management as of June 30, up 2% from $426 billion as of March 31 and up 13% from the year earlier quarter.
The firm raised $12.4 billion in the second quarter, up from $5.3 billion of inflows in the first quarter and $40.9 billion in the last 12 months. Carlyle has a fundraising target of $40 billion for all of 2024.
“We expect exit activity in the second half of the year likely to be materially higher than the first half with several large transactions in our pipeline,” Schwartz said.
During the same call, John C. Redett, Carlyle’s chief financial officer and head of corporate strategy echoed the upbeat tone on exits.
“In terms of exit activity, we now are seeing more robust competition where an IPO is a real exit path and strategic buyer interest has picked up,” Redett said.
Carlyle’s private markets funds invested $4 billion in the second quarter and $20.2 billion in the last 12 months.
When asked by an analyst about Carlyle’s investment outlook for the second half of this year, Redett said Carlyle is a long-term investor and not focused on day-to-day “market gyrations.”
“But look, if we're in an extended period of a down market, … I don't know what happens, but I think it's probably less positive than where we sit today,” Redett said.
Redett said he feels good about the pipeline of potential deals for the second half of 2024.
GAAP net income $148.2 million in the second quarter and GAAP net income of $213.8 for the first half of the year, compared to a GAAP net loss of $98.4 million in the quarter ended June 30, 2023 and GAAP net income of $2.23 million in the first half of 2023.
