KKR's Quarterly Profit Rises 29% -- Update

By Gillian Tan 

KKR & Co. on Thursday said its first-quarter profit rose 29%, as the private-equity firm continued selling stakes in the companies it owns.

The New York firm reported a first-quarter profit of $270.5 million, or 57 cents a share, up from $210 million, or 65 cents a share, in the same period last year.

KKR's first-quarter economic net income was $599.4 million, or 62 cents a share, down from $630.3 million, or 77 cents a share, a year ago. The result topped Wall Street's estimates for the profitability measure, which includes unrealized gains as well as cash earnings. Analysts polled by Thomson Reuters anticipated economic net income of 53 cents a share.

Economic net income at the firm's private-equity segment rose 17.1% from a year earlier, buoyed by the sale of stakes in pharmacy company Alliance Boots GmbH to Walgreen Co., Big Heart Pet Brands to J.M. Smucker Co., and Fotolia to Adobe Systems Inc. KKR also booked gains on the sale of stock in Nielsen NV and German forklift truck maker Kion Group AG.

The firm also further marked up the value of its stake in Atlanta-based First Data Corp., which KKR only began to value above its cost at the end of 2014. At its lowest point, KKR had valued First Data, which it took private in 2007 for about $26 billion, at 60 cents on the dollar. It is now valued at $1.18 on the dollar.

KKR reported assets under management of $99.1 billion, down from $102.3 billion a year ago but up from $98.6 billion at the end of 2014.

Meanwhile, its distributable earnings--the portion of profits in which shareholders can get a slice--were $516.5 million in the first quarter, up 15.6% from the prior year's $446.8 million.

KKR said it would pay a dividend of 46 cents for the quarter, an increase from 43 cents a year ago.

KKR shares closed up 0.9% at $23.37 on Wednesday. The stock has gained 0.7% so far this year, underperforming rivals Blackstone Group LP and Carlyle Group LP but beating Apollo Global Management LLC. Blackstone last week reported its biggest ever quarterly profit, while Carlyle and Apollo are due to report quarterly results over the next two weeks.

Write to Gillian Tan at [e-mail]

Access Investor Kit for Nielsen Holdings NV

Visit http://www.companyspotlight.com/partner?cp_code=P479&isin=NL0009538479

Access Investor Kit for Adobe Systems, Inc.

Visit http://www.companyspotlight.com/partner?cp_code=P479&isin=US00724F1012

Access Investor Kit for The Blackstone Group LP

Visit http://www.companyspotlight.com/partner?cp_code=P479&isin=US09253U1088

Access Investor Kit for KKR & Co. LP

Visit http://www.companyspotlight.com/partner?cp_code=P479&isin=US48248M1027

Subscribe to WSJ: http://online.wsj.com?mod=djnwires