Carlyle Group Inc. (CG) shares declined by 6.4% in premarket trades on Wednesday following the private equity firm's announcement of a second-quarter loss. The company reported a loss of $88.4 million, or 27 cents per share, for the three months ended June 30. This is in stark contrast to the net income of $245.4 million, or 67 cents per share, reported in the same quarter last year.
Quarterly revenue experienced a significant decline, dropping to $462.1 million from $1.05 billion in the previous year. Fee-related earnings also decreased by 12% to $207 million. Despite these setbacks, assets under management saw a slight increase of 1% from the prior quarter, reaching $385 billion.
The primary cause of the firm's second-quarter loss was a $104 million investment loss related to Fortitude Re, a reinsurance business in which Carlyle Group has an interest. Despite these challenges, CEO Harvey Schwartz remains cautiously optimistic about future activity levels, stating that "the peak of the inflation cycle may have passed."
The Carlyle Group acknowledges that the economic backdrop remains complex and investor sentiment remains mixed. However, they are hopeful that activity levels will begin to accelerate moving forward.
Key Details:
- Carlyle Group Inc. (CG) stock down 6.4% in premarket trades following second-quarter loss
- Second-quarter net loss of $88.4 million, or 27 cents per share
- In comparison, net income of $245.4 million, or 67 cents per share, reported in the same quarter last year
- Quarterly revenue declined to $462.1 million from $1.05 billion
- Fee-related earnings fell 12% to $207 million
- Assets under management increased by 1%, totaling $385 billion
- $104 million investment loss related to interest in Fortitude Re contributed to quarterly loss
- Carlyle Group CEO, Harvey Schwartz, cautiously optimistic about future activity levels
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