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UPDATE 1-Carlyle's fourth-quarter earnings more than triple

Greg Roumeliotis
Wednesday, 19 Feb 2014 | 9:33 AM ET

Feb 19 (Reuters) - Private equity firm Carlyle Group LP said on Wednesday its fourth-quarter earnings rose by 216 percent to a record as the value of its funds jumped and profits generated from the sales of assets soared, beating most analysts' forecasts.

Buoyant capital markets not only boosted the value of the companies held by Carlyle's funds but also allowed the Washington, D.C.-based firm to cash out on more of its investments and return money to its investors.

The value of Carlyle's private equity funds rose by 9 percent in the fourth quarter. Peer Blackstone Group LP reported an 11.5 percent rise in the same quarter, Apollo Global Management reported a 9 percent rise and KKR & Co LP reported an 8.4 percent rise.

Assets sales in the quarter included Carlyle's $1.39 billion sale of aerospace communications company Arinc Inc to Rockwell Collins Inc and the sale of human resources software company Personal & Informatik AG to private equity firm HgCapital.

Carlyle also completed the initial public offerings of luxury jacket maker Moncler SpA, telecommunications equipment maker CommScope Holding Company Inc, travel agency CVC Brasil Operadora & Agencia de Viagens SA and cable operator Numericable Group SA.

It also sold shares in auto parts maker Allison Transmission Holdings Inc and television ratings company Nielsen Holdings NV, which are already publicly listed.

Economic net income (ENI), an earnings measure comprising cash and paper profits or losses based on how funds have been marked to market, increased to $576 million in the fourth quarter from $182 million a year earlier.

This translated into post-tax adjusted ENI per share of $1.64. Analysts on average expected 91 cents, according to Thomson Reuters I/B/E/S. This was the best quarterly financial result for Carlyle since its initial public offering in 2012.

Carlyle also said the value of seven of its funds rose enough in the fourth quarter for them to exceed return hurdle rates of between 7 and 8 percent. This entitles them to pay out so-called carried interest, giving Carlyle a slice of the investment profits generated by the fund at a time of Carlyle's choosing.

Carlyle's pre-tax distributable earnings, which show how much cash is available to pay dividends, were $401 million versus $188 million a year earlier, as the company monetized more of its assets.

Assets under management were $188.8 billion at the end of December, up from $185 billion at the end of September.

Fee-related earnings were $39 million in the fourth quarter, down 30 percent from a year earlier.

Carlyle declared a fourth-quarter dividend of $1.40 per share.