CG - Earnings call transcript Q3 2024 | The Carlyle Group Inc.

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Operator

Thank you for standing by, and welcome to The Carlyle Group's Third Quarter 2024 Earnings Conference Call. [Operator Instructions] As a reminder, today's program is being recorded.

And now I'd like to introduce your host for today's program, Daniel Harris, Head of Investor Relations. Please go ahead, sir.

Daniel Harris

Thank you, Jonathan. to quarter welcome earnings and morning, Carlyle's XXXX third call. Good Head morning on our Chief and release John and the which a me earnings available we is this Chief Corporate morning, Redett. Earlier call Officer a and With website. press Schwartz; on this our our issued Relations Strategy, Harvey Executive Financial presentation, detailed of is Officer, Investor webcast is being and call will available. a This be replay

considered These to in refer measures non-GAAP isolation measures a should as certain be accepted accordance accounting prepared call. will We principles. during substitute not financial in generally measures or from today's for with

We and have forward-looking a of reliance placed be undue Any not statements to release GAAP these measures do provided should our not earnings in available. them. reconciliation extent on made performance, reasonably future the today to guarantee

could are annual forward-looking statements including uncertainties, section identified These and expectations statements on on indicated. update differ management time. Carlyle report at risks no Form actual of based involve obligation Risk any assumes and inherent that to materially from in cause Factors our results those the any to those current XX-K

In question for to return to today, yourself please the ensure X the all participation limit on order that's queue follow-ups. any line additional to and by

over let me turn our With that, Officer, the to Schwartz. Executive call Harvey Chief

Harvey Schwartz

morning, Thanks, Dan. and everyone, thank Good you us. for joining

prioritizing new and actions better performance, drive leadership, to expansion, including initiatives. X.X strategic compensation past several the our model, undertook Over appointing we years, among realigning margin other

of the beginning with one the pickup in of steps. combined those today, generated, a quarterly history. As impacts firm's performances we across These activity stand to see best you're early the the here in actions, platform

and year. of the quarter FRE up the we third target our at last are year. up since track XX percentage $X.X fee-related XX% quarterly XX%, our Overall, billion earnings, hit FRE of record than delivered more best-ever on to We points margins versus XXXX, for

fund the quarter. equity share earnings well. the XX% This appreciation nearly accrued to per performing represents increase for nearly private accrual drove net Our in strong shareholders. prior corporate portfolio very This is future our compared our that underlying of investment $X fueled revenues performance

As was momentum. the part of taken is is markets direct that capital under-leveraged proactive around about we a platform to our substantial This steps of transaction result gaining alignment talked increase fee generation. previously, we've significantly

transaction closed Including despite annual a already we've IPO highest subdued in fees. markets Obviously, of fees. growth M&A still QX our we expect level activity, generated environment further and capital This

$XX billion for over fourth close we capital new We billion fundraising, anticipate capital months. in continue $XX the billion we and of a year. of XX raised inflows the very about past to and the have year, raising On $X the strong out target to raised quarter of quarter

election first Being that broadly capital the switching market Now stock election let's start has in environment. macro and the the to results. like with across Markets and markets, yesterday. removed certainty, past market foremost. uncertainty, the Obviously, you're seeing particularly

are and well invest and should Over work. capital the should be sectors capitalize we in opportunities environment in. monetization this term, long an This be positioned put key catalyst medium further for M&A IPOs, we which a to on to to

and entered has Prior stabilized. and policy, combination, are monetary to rates, clear election policy that interest the supporting was a seen the had Reserve monetary in shift and that stance business. sign that inflation in U.S. powerful and change election, we growth Federal already we a new economic on The our a certainty era

this the well, the increase second XXXX. $X year. year month. billion, Rigaku been portfolio seeing and for in IPO X We've first best and a XX% of since a day over Japan. this benefit the increase X activity with last U.S. IPO in XX% year. our this months already There's significant the sponsored-backed trend IPO in in as uptick the significant the We're proceeds marked StandardAero this seen listings a first in in raising IPOs in StandardAero U.S. and U.S. performance just IPO, largest of

is key and power for a government Carlyle. ally Aerospace, services defense

D.C. is us. a the space demonstrates growth than is sector. Our that more differentiator XX-year of businesses the high-quality history and and was aerospace in in This the ever for roots starved this for outside IPO tech market largest core and

Japanese Rigaku and remains was IPO year very market Japan ever for the this Japan. second in sponsored-backed IPO us. the largest attractive biggest a

has realization sentiment investment liquid underlying platform, our more performance a market pipeline improved environment. strong and year's portfolio returns. A a activity ability have dynamic active reflecting across investment opportunities backdrop act in driven and our higher This to more stronger on supported

X X largest were our this XX%, up each were U.S. and funds respectively. north buyout up Asia X% quarter and largest Our funds X% buyout of

This performance third history. largest in were the quarter accrued firm's $XXX quarterly of net revenues revenues increase represented million our performance net Over in generated.

platform Switching wealth, from where we wealth to benefited momentum the area of we're billion $X.X a strategic global strong another record across inflows. seeing of focus,

year-over-year. were inflows wealth quarter is quarter, the wealth Our and nearly up the amount AUM Xx XX% global in our previous this

newly XXXX. are in Part seeing traction and their advisers early Cap making to secondaries is private in with our We're progress clients. our solution, wealth product still strong of launched wealth very launch the momentum on equity also and is M, track which

is in Another asset-backed finance. we see growth where area accelerating

companies the with We us continue give origination to differentiated specialty finance and to market. our bolster capabilities edge further partnerships data a identify in

to paper only post-GFC XXXX. also We've and issuance time. trillion have in loan for record Full to leveraged spreads third CLO new $X leveraged year levels demand is XXXX tightened U.S. outpacing the seen supply. Loan for and is loan expected exceed issuance

having team XX transactions has track and of CLO be priced with globally, our on to resets business busy record a leading year very been transactions priced. the Carlyle, At

quite opportunities The insurance significant. in business remain our

assets almost pursue year. Fortitude $X It allowing excess has billion, to the position grown capital more a its past pipeline. increased us general account XX% has by reinsurance its in than robust to

important asset-backed broadly private insurance leverage channel. and further and relationships We with this also clients continue investment-grade to grow in capabilities our our finance

had well third Carlyle macroeconomic extremely strong up, improving with quartile wrap to we a To on capitalize positioned an environment. things

long-term Our performance on for leadership to our laser-focused growth value you, drive accelerating team shareholders. remains driving and

me let now call over to that, John. With the turn

John Redett

Harvey. morning, Thanks, Good everyone.

are are The over include strategy, of see ago, pleased continue very taken business we margins, FRE the year. strategy we the activity. The made markets much benefiting activating compensation realigning than benefits the revised XX performing and our improving months also we market step-up better capital over and we've is investment past to year. new year just we've progress the performance, leadership, the improving flywheel, appointing allocation this from implemented capital with was We in it actions material last a

which drove generated momentum the to has private X quarterly our up at in of which equity across record FRE last XX% funds, billion. And higher including performance and accrued CAGR years. material AUM of operating strong fee of $X.X $XXX grown in FRE actions margin. significant our Record business, last $XXX leverage to net $XXX AUM billion, year. performance corporate have earning These XX% over a compared Record shift at million a a XX% revenues billion,

million or per year-to-date We in DE for And higher $X.XX in last per XX% of DE share. year. $X.XX $XXX produced share the than is quarter DE

with equity XX% from private shareholders. more of X to important million increased the our third XXXX. fee-related fee-related $XXX in Starting earnings, and the quarter earnings. corporate areas: cover than let's return capital FRE business, quarter, in appreciation Now to up

hit billion, to would fee-earning stands of track level on are year-over-year growth. nearly represent since which at billion, XXXX XX% AUM our FRE of our $X.X the third target $XX quarter Pending highest We XXXX.

fund. And buyout in fund. activate quarter, expect fees latest In on XXXX, U.S. to the fees activate Japan our we new real fourth estate on our opportunistic we'll

market were more than capital year ago. a XX% fees Year-to-date higher than

significant will large We closed. transactions capital in see already several increase QX market as a fees have

expanding capabilities a over in higher markets see this focus our of on activity. to time our level support area We as expect capital further growth should

to Let's turn appreciation. fund

performance a fund creation As significantly. and from our and benefit environment. significant expansion was growth, the is was noted, appreciation the exit EBITDA year-over-year, value positive strong this equity at is further up This positioned corporate fund to XX% margin portfolio in U.S. well driving better across Harvey underlying our growth the continued up portfolio. private level, Driving

Net $XXX $X.X accrued more increased performance than to million billion. revenues

pretax As share we of shareholders. almost $X represents earnings noted, per our this for

allocation. me touch capital Finally, on let

to of into of continue repurchases in shareholders. quarter, We the balance bringing capital third returning to We million shares total our $XXX our year-to-date. repurchased capital and business million to deployment $XXX almost

the down and It is consecutive second over we remaining on continue year, shares for million are repurchase share outstanding have repurchasing to shares. $XXX our Total authorization. our intent

our for growth. However, is priority first investing

strong for results Wrapping to shareholders. our focus up, on we delivering continue

platform And track to achieve conviction for out our targets are in of ability earnings XXXX. for we to have on shareholders the laid drive higher that time. we the We increasing investment over financial

the the turn me for let questions. that, call to your operator over With

Operator

line the of from first Goldman Our Blostein Instructions] question Sachs. [Operator comes Alex from

Alexander Blostein

macro a you the couple us question, made Trump maybe bit comments with So the a space, how also Carlyle. you that side, how little kick regulatory obviously, a to any items related and the attention set election, activity a just remarks. off to on both paying could could in to you're opening I but administration of think and know alt impact But of activity your curious macro impact particular in of

Harvey Schwartz

maybe Well, to had reaction market a for outcome. the take unexpectedly because, obviously, Alex. an back Thanks, step strong minute the a

of comment. we the David do David that going something expectations, yesterday, maybe said, I TV involved to a the polling need process. AI made get he this he effect think said obviously, the were the to losers He process pollsters. in a in. to with on lot has was and Rubenstein, And in

that we were making was have think market. strategy, minds a for not taking weeks, the certainty outcome possibly that relief this into the think a a and in how about days, they I uncertainty factor now decisions. might headlines obviously of quite think how having committing for creates there And That the CEO's behind election, and months. And capital, not election about the very if about lot significant they seriously, fact coming concerning result

sustained translated the in confidence these M&A of Now environment, and lead or in CEOs' lead whether from around it's it's It whether tax to things all to portfolio get minds, further touch, decision-making. will will regulatory a should regime, lighter activity. operating that Boards, policy cuts in a more perspective, the companies really more our

can from a strategic Board. you perspective, not or whether transaction a you done your as pause that not obviously, you're of lot a If get certain gives quite

the reacting market what I is is so to. think this And

Now business. already of our business, the we're seeing lots tailwinds of in terms in

that actions and it the market stability when A A the flattening taken. X-X powerful pretty the business I punch out, I we the big policy strategic You Fed specifically future policies, see our normalizing, environment. that Carlyle. normalizing is of part interest the the has numbers big team of part today. in saw of management is And plus markets being that's past for Fed think rates for a election, certainty, think policy just election at the and

John Redett

Alex, the and removal for capital election company obviously those the what confidence better, of levels. to would only good And like I is, markets the the our being And for a and add thing uncertainty bit CEOs little is it's a good think I common I certainty, for just things couple M&A. yesterday, echo would our will spoke And said, all portfolio that echoing that's was it's stronger, the good theme election they feel Harvey -- we elevate that's of business.

Operator

question from comes Ken of Worthington JPMorgan. our next the from And line

Kenneth Worthington

into dig wanted performance. to I

despite of You you called and same think sort CEP to if some like IRR net to the remained time, look jump StandardAero, fell the at V, X%. there's having seems should the nice at carry. more CP about the come. Rigaku, in How IRR At you X% exits, given we in VII accrued And as in out headwind? you are the expect the developing and I it it and exits environment, see improving if changing the And the change buyout have trajectory? environment? so, or enough big as see view, to you different a in and if Do investment metrics in fundraising get buyout community, again, think a performance we, that is performance this the

John Redett

John. it's Ken,

add good U.S. funds seeing the it U.S. majority in just was about fee was it driver in we vast within performance total private $XXX like good up What business, and performance accrual revenue improvement we've one that's is a private expansion. improvements. I in million, saw quarters very we're look, Asia, EBITDA had. Look, we're the corporate Harvey equity exit net performance. margin that. good very big operational in the improved a only the I that best And and of alluded is seeing ever as corporate We're growth, strong markets Asia our to a to nearly of think and reflects $XXX particularly economy, of It's million it better appreciation and our healthy. the in growth, this, equity strong So drove

team open on our the I this been look, the improving very we've when to as topic it's been at performance have focused focus the we've reflect very, in -- business. previous And And private very you this numbers look leadership business. equity on quarter, starting results we are think the a on calls, this in

business, over we of a time and like we grow. this business We trajectory is that this the can know

I deployed, in gross IRR improvement fully IRR a XXX the on so most CP net particularly on materially getting pickup that think in not VIII, less basis vintage, just our relevant. IRR CP through would to is see the the performance did a we're focus catch-up is I U.S. the the point fund you but VII, X notable phase, quarter the the is see would you're not on change net in as lot recent I IRR. as going gross say

Operator

our comes And from of line question Ben the next Budish from Barclays.

Benjamin Budish

ask to XXXX your wanted bit terms in credit I you about expect the of on outlook a side. what little for

I done year. a be kind with the of major with I recall, in kind private expecting a equity big done sounds fundraises like of side, you're should pickup fundraising you the it you're of Same by as this and there think on activity. solutions, end of the mostly the lot

platform? build, thinking side, terms on develop fundraising to that what's else in your So kind you are activity? of the What credit grow, how for expectation sort of of about

Harvey Schwartz

momentum across mentioned previous Across the about, around I significant. the remarks, credit credit, is in way the finance. insurance, really And asset-based capital but in say I'm talking the that, strategic quite when part, you opportunities stack, my I through as and all

So from intelligence position. because positioned and to continues insurance part the we Fortitude private plus with that, have and well the we're in our investment-grade very their partnership with market grow, all that, capital of excess just

markets. very about this And at feel about attractive. activity, these rate, credit it's the the I levels, optimistic spreads So we spreads at CLO quite talked

remain to activity expect we quite so And high.

Operator

question Davitt next comes Autonomous our And line from Patrick Research. of from the

Patrick Davitt

positives outcome of fairly if and Trump ultra done for like curious lot guys aggressive us. scenario I you think how of that tariffs muddier where business testing of win plans portfolio have fare the those. a is in-ground went bit would you lot for a mass and/or there's the any obvious, and/or you through from the the more of through deportations the some have the a But little

Harvey Schwartz

history. Tariffs, obviously, as a firm, we've worked through tariffs before in the firm's

And at of be C-suite, so company number and how assured at around not implemented. can that. risk-manage is be portfolio scenarios, in gets you going like terms have the this a things around in But we level to to just -- any the policy of wait-and-see

across this for industries focus diversity unique also, Where we we there no of both industry all obviously, move But benefit issues will Carlyle. the the on forward. obviously, groups But geographically. is franchise, something that as from are and is

Operator

of next line JMP. McKenna Citizens from Our question the comes Brian from

Brian Mckenna

on cash well once the this to about balance we how moving excess to accrued in should over of on which quarter, with fees this significant in positive M&A, implications time. over organic clearly vast future great relates has strategic time, it's the buybacks? as step-up sheet to earnings see performance think But majority specifically net growth, realized, as So as capital the it deploying ultimately the

John Redett

allocation as Yes, where look, there just the we we Brian, think, I a it's of mean, get And John. more Thanks best I couple we can a for of levers, return. the firm. of think question. have are capital broadly

a active is buyback, that very share which them of on One been we've front.

businesses the is one other growth. for investing The organic in

about allocate area organic is of is the the I at it And on we everything. all look shown growth. say just first priority. opportunities, had can focused inorganic is we we lot our We area another time. where other very Obviously, stuff. talked That We're would a capital.

growth -- open do said, business we Where into sense, that returns along to inorganically would made best our can investing something we today, a hesitate. continuing share to That we sense, for for if get we be sit think organic shareholders came buyback. we strategically wouldn't made our the financially and

and we really buy where on to nothing on buyback nearly our shareholder the We're on is $XXX sit million Remember, million imminent. shares. And focusing But remaining very continuing growth of back done balancing we have authorization. objectives year-to-date, we're share organic focused we've $XXX today, to returning capital growth. just organic and

Operator

our line from next the Glenn Schorr And Evercore question ISI. comes from of

Glenn Schorr

capital asset net the and bigger see than And you only little like to less love all IPOs there's quarter. we'd no outflows better or and activity. M&A -- are maybe fundraising growth saw short-term think I in this a the downside if markets is bit pickup

look I in the it reflects highlighted. X% growth the I don't the going that what's momentum on underlying what feel real growth year-on-year, when at in fees in So you've management is like

curious So growth fee to as we about path all that think you have. a should management powder how you there that deploy dry is start to double-digit

John Redett

lot Look, growth we in terms area team, the revenue the X% capital of focus management progress driven a quarter. markets pleased the of been A made we've was capital of fee has this John. with Look, our for we're by and capabilities. this in markets. had very It's

sheet to a it's sense look light business. capital need a in balance we're capital I aren't only back markets focused activity. our markets think Carlyle-related sheet And risk. step really We the on And at taking and balance again, you take

than So I the a different little others in think it's industry.

year, This record year. will generate result business XX% this has a this grown

our focus about the this markets capital And effort. again, deliberate area good very for firm. very a feel we So has been

corporate on nearly management fee be management in growth side. business management some in management in up seeing still market we're as seeing will expected, in on We're equity we're really growth, It's credit. optimistic solutions. fee said growth fee that the private look, And fund. that than XX%. raising of more estate strong terms terms fund of fund, headwinds grew good private and equity That In larger XX%. And our we're a the past real We're outcome. previous seeing in we've the the nearly very in fees,

we're in time. this business. the terms in the of we But equity, can business of like performance on been this trajectory that private really over we've And business. this We corporate very grow focused confident

Harvey Schwartz

in X.X I line, bit asset-based credit top the it's would just Sitting first statement. the now just for being into the to years, Glenn, momentum whether equity. with agree starting in over private wealth, strategy, the in franchise your say, translate seat in is I here, a insurance really finance, the solutions, and credit,

the feels good. quite momentum So

Operator

Our next Fargo Wells question comes Brown from the of Securities. line Mike from

Michael Brown

X.X Carlyle. it Harvey, seems of at point, plus place So foundation into at and like the the is established job, kind years this in

kind think you As what billion annual about what Carlyle the years, next of fundraising can is think kind right about this the of deliver way to few on potential? $XX annual the Is basis? an level

And I kind potential to then growth of you a point here. Carlyle horizon, guess delivering think FRE from also of low get the annually? growth FRE if that multiyear double-digit about can

Harvey Schwartz

Yes.

say, X.X would right of with and right right first as of made the I I the sure that capital expense the course, a number making we appointments, and, really in methodology the over was just you the right in, principles seats period. So years right people the know, time all had strategy, leadership

you areas really these are quite to about look powerfully. future have think you when terms in of at that Now growth, FRE the strategy, emerging

quality sheet this, is we just there. John runway said capital revenues And balance of running So exceptionally a riskless those basically business. because see which we're light, high the markets,

launched -- a around next we'll at years. world, really last resonating sorry, solution to channel, the the equity it But The model launch the and numbers momentum over Carlyle really when private talk that where to advisers hard so second our I several point the momentum year. year next across we've solution, only wealth we're But brand you there's quarter, in the the see our I'm this firm.

communicate out with was comfort that put $XX target in about some this this we we being time. think give of billion, the seat. you fundraising, how over of new year that really terms me to We'll just In

but was can still you one by lockstep of we every to left again, extraordinary. like think unfortunately I be But I it's X, feeling the that's quarter. early that did tell you at that, days with pretty things the the momentum we XX divided months, $XX going feels mathematical a billion

Operator

Brian And the Bedell question Deutsche our next comes Bank. from from of line

Brian Bedell

landscape? just, you tariffs you there? topic, to Maybe back about any perspective Europe if see from the a regionally? how U.S. deployment potential just are trade in I frictions any -- thinking between And and I guess, global go you How thinking firm-wide impact the and can you Do And are tariffs Harvey, deployment Japan? from deployment the outside are viewing that

Harvey Schwartz

difficult think So anticipate again, or And local, to government think I opinion, business, my for policy. try any changing be, very tariffs, it's advice on it firm, an and the I would mistake strategy. any be to in global actually

of for prepare could any world-class scenarios. you Now that. And do number management teams

of terms cases, franchise, we are local. our in global, very many In but remember,

franchise. look have you the our leading if a few we're of So Japan at business, one Asia that

Asia China. Our Asia, spans business Southeast India,

And we the with regional these being benefit of have very a global -- capability. so

I think advantage. an that's

any that's I Now an advantage environment. think in

to But you're going around see. think have so game-theory we're -- can more out again, to I I that's various you think expectations things, But have something just prepared. tariffs, can you

of really elixirs on always periphery, is think the where the for confident exits more feel uncertainty regulatory resolve things market I that will much they the over see for and opportunities. we be how all that investing we'll be around but these and time. tax and can elements there for policy touch will powerful But

Operator

question next of from comes the line from Brennan our Hawken And UBS.

Brennan Hawken

XX, also about the the third you Was XX. in fundraising to Estate pace are like might confirm, about sort It's we the talk quarter? did close of little reading so that the year-to-date, -- is come Real around a the this, number? Fund And how and to a And I be to but X softener and meant as should upper mid-XXs much thinking the through? in be now you're too point. fourth seems interested about meant into drivers the it quarter? like XX of pace will just about So What talking that behind the

John Redett

add. Brennan, the and feel it's we across momentum very feel Look, John. bit fundraising. on said in echo little fundraising to have Harvey, a I'll I'll good start what about free Harvey the with franchise. that, We

alluded we've year-to-date You in That's second-best ever our period the year-to-date. billion number, had history. to $XX we're it, the

So I think have of we a lot momentum.

have pretty the quarter The We looks good fourth visibility strong. quarter. into fourth

So in specific to around I perspective a a really the number to longer business forward, XX. we'll period more get and hard It's Stuff manage moves fundraising over stuff. a focus it And from of much stuff time. on moves back.

we'll get I the to maybe maybe slightly. we exceed underachieve we think XX, close it slightly, it

that because in think about terms business, managing seeing the that's in great period. we it's momentum a bit touched channel. be we multi-quarter have look in wealth in this, doesn't big to our of more matter just a going whether the asset-backed And it's focus on in across we estate, fundraising the the franchise, business. And we're it over little quite it Harvey forward. a we momentum on But we how think and at whether real frankly, will really whether solutions, continue of component

guess quarter year. of the momentum and very fourth feel going we we I it in about into terms I'd answer more have So the good next

Harvey Schwartz

anything the trying Yes. to I with about. guess we weren't signal really

we where have we things there's how can certainty. the driving give that think more control over you or more end we're the control XXX% year, like FRE over, I of into

"Hey, like for delay If who to whatever extend the of decision-making wanted we you important some we work clients election" say, to handful look, with we things," some reason, our -- we'll have "we'd clients. a or

and We so don't needs. our of running purpose That's deployment fundraising you the why that. And clients' business really for we of hitting purposes number. manage for a for hear the fundraising the manage

I should XX if hard side maybe you a at the was XX. the year of said have impression number, gave of But beginning either I but the that

signaling no other than So but anyway great. -- no, here, big the feels momentum there's

Operator

question Research. of Chubak our And comes Wolfe from the Steven from next line

Steven Chubak

opportunity markets. poised you frame in the help capital accelerate, was could momentum you're revenue With seeing So hoping activity franchise. you deal I the noted across to

you that achievable you're run this how opportunity you gauge least envisage? whether at business the relation for in to trying an Just about resourced think adequately and to rate

Harvey Schwartz

terms last alignment forgot of very well made changes in we that's for I here around [ you're ], it's results completely incentives I So quiet why QX were environment year, firm, and resourced. resourcing, really we we the specific and think, prioritization, feel The yes, you're with a against seeing. the seeing given Again, a, a see. this record is activity, already pretty focus, may what

at intensive business But I think of we runway lot tipping more what it sheet for have balance strategic point point if this does get -- there. we becomes a us? the a is of before

activity I have think we activity. more lot deal a of so And capacity. drive And will

engine are tell now. the difficult you Giving the of because you a pieces in little like hey, can you a activity place proper saying, the runway it's is I can forecast economic next all But year?

John Redett

a continue just very comfortable Yes, accelerate. record going improve, think are continue have this a markets capital would we we We're Steve, number And terms of markets would revenue. year that Harvey echo I to market. repeat, as in And in to said. quiet relatively should what across I to platform that just the was

Operator

Katz And Bill line our next from . from question TD comes of Cowen. the

William Katz

tack FRE. Just maybe on a slightly different

You've done for? we at look What's margin as strongly. the you enhancing a the FRE as you year ahead? shoot up very you good very much and it's incremental segments, if more job of for algorithm different the can year-on-year, How next mentioned, margin, look

question. secondary a have to just then And

growing you're paying do fee assets, interplay between think how Just where assets, management you're base where between given fee AUM the about we realizing the the interplay rate? growth versus

Harvey Schwartz

expense-saving accomplished they've to it, year, incredible set an introduced the the run firm. a to short to come that, in of John have period I do a to lap for want very several the in some into the time, months amount think of those for I of because going I'm introduced they -- methodology, really before details. before John how management last initiatives. compensation team, foundation a Well, I whole take completely And structured we victory But period and just want and

turn the himself Personally, there's I'll on of pat but But back, him. John? over the to that think do I'll or some he I up, upside. won't John. more so -- on details, But for it team his

John Redett

very Bill, We FRE. good had year. we feel Yes, look, about a record

As in year. $X.X hit remarks, the on billion path to I said clearly for my we're

on We fourth quarter. have visibility good the

We're at than margin is was it perspective. points X higher let's XX%. is. basis year, This very the put in ago. than basis with X,XXX where was It's last higher probably years pleased X,XXX this points Again, it

progress. tremendous made we've So

about on I more And thinks But look, management organic margin efficiencies. the way versus FRE growth. would the much this is like to grow focused team the more business via see growth we are

bit I little we'll But to -- business you that margin the efficiently, expect think as the think we'll continue business grow run efficiently. over get improve from to and we running could time. there's see a I

Operator

next question Stanley. Cypress our from Michael comes line from of the And Morgan

Michael Cyprys

asset-based ask to for wanted meaningful Just Carlyle. about finance, a opportunity growth

AUM, of the look 'XX take what to set? just you the about stands . us business of best So in part platform extent expand to that that capabilities opportunity some where hoping you talk to you to accelerate might that And on could platform. maybe been of And today into capture growth how steps might here update the terms growing. just of has

John Redett

And of lending. But say, ABS Look, John. a growth It's is enormous. Carlyle. in think days large Yes, the us space. I'd credit Again, think be this it for I the multiples opportunity an direct very for I it's industry think market going look, for and of enormous do it's early I it's driver forward. will

of largely couple third We a the obviously quarter. the for very announced transaction closed transaction transaction ago. us. is Discover That high-profile It post months a was

So we're with that. very pleased

ago. couple is started have AUM. be billion stronger flow the of of years one arrangements. continues across a The from we portfolio already of one-off look, pipeline platform. the a scratch We to we roughly $X this And Look, and mix business organically purchases a of see pipelines it's

will kind We continue it I arrangements. expect a time. have I in flow of handful of But over a to place increase be that of portfolio arrangements. to and would think flow purchases mix

and the But We're assets, covering Monogram, pleased others. of more arrangements we where Unison, a about that like probably the think is, to business heard business. forward couple have partnerships that this we you different potential. the going business and A more this the we or have with should lot flow to as flow of have us business past are really you've evolve. us in we arrangements expect continues has flow really And Triad, talk multiple

Operator

And our Bank next Siegenthaler question comes from the from America. line Craig of

Craig Siegenthaler

Stock-based prior be comp earlier grants this next should step-down XXX year the XXX there commented a is run-rating I now calls year. between in believe And you that XXXX. on after and

the I related is higher the stock, today. of issuance which mechanics believe also of the However, is the price to

next So perspective how to should year I your quarter. stock-based just we forecasting relative wanted it in be comp on past came this where

John Redett

this previous John. for it's And the a specific said calls, units. bit this Good little you. Craig, around the I've from performance accounting stock treatment on hear is of to

quarter It's As you today elevated recall, actually levels. But heavily third the in at normalized from we stock-based be them seen we to to the an continue comp that down elevated more accounting stock-based number XXXX, do trend last will It level And quarter. quarter. are the perspective, vest. fourth see our expensing in versus comp quarters. they at third few to levels in expect upfront you've when the

Harvey Schwartz

the the Again, is of that grants accounting gave. we this phenomenon

did we stock that with those We which strategically buyback obviously associated significant things share are is bought a much the that back in of anything announcing of portion dilution. of advance awards, levels. the higher One already

This So attractive, all that's negative. this. first been seeing X numbers years years look to hasn't doing why so is the and a John these you're certainly relative prior dilution the the to I dilution

John Redett

X Yes. look, X% this we're count down very I repurchasing year. mean, Craig, actually share on And focused down. It's the is years, the shares. last

Operator

remarks. question-and-answer to to conclude any like for Harris hand I'd today's Daniel And back of the the you. program. program does further session this Thank

Daniel Harris

Thank you quarter. reach out all much to the very today. call. We have and for to any again your Relations Investor you attention talking with follow-up look next after you forward to free questions, feel time Should

Operator

Thank today's you, program. conclude conference. gentlemen, and This ladies participation for your in the does

day. Good disconnect. now may You

The Carlyle Group Inc. (CG) 7 Nov 242024 Q3 Earnings call transcript