By Greg Roumeliotis
NEW YORK (Reuters) - Blackstone Group LP , the world's largest alternative asset manager, reported a 30 percent rise in first-quarter earnings, driven by strong gains in its private equity arm that more than offset small declines in its real estate unit.
The results, driven by assets sales and a strong appreciation in Blackstone's buyout funds that outpaced the wider stock market, beat most analysts' expectations and sent Blackstone's shares up 4 percent in pre-market trading.
Blackstone said on Thursday that economic net income (ENI), a metric of its profitability that takes into account the mark-to-market valuation of its portfolio, was $813.9 million (484.1 million pounds) in the first quarter versus $628.3 million a year ago.
That translated into ENI per share of 70 cents, more than the 55 cents that analysts forecast on average in a Thomson Reuters poll.
Private equity was Blackstone's star performer in the quarter. Its buyouts funds fired on all cylinders, appreciating by 7 percent in the quarter, while realized and unrealized performance fees soared by 413 percent.
By contract, the firm's real estate portfolio appreciated by 3.8 percent and its realized and unrealized performance fees fell 5 percent.
The realized performance fees in real estate, however, rose 171 percent to $195 million, as Blackstone continued to cash out on its global office portfolio, including the Broadgate Estate, Equity Office Properties, CarrAmerica and Trizec assets.
In Blackstone's credit investment arm, ENI was down 18 percent, as performance fees dropped 22 percent. Blackstone's unit that invests in hedge funds reported a 21-percent increase in ENI.
Distributable earnings, which show actual cash that is available to pay dividends, rose 24 percent in the first quarter to $485 million.
Total assets under management reached a record $272 billion as of the end of March, up 25 percent from one year ago. Fee-earning assets under management rose 19 percent to $203.6 billion.
Blackstone said it had returned $11.5 billion of capital to its fund investors during the first quarter. It also invested or committed $7.4 billion of capital in the quarter.
Blackstone declared a quarterly distribution of 35 cents per common unit.
(Reporting by Greg Roumeliotis in New York; Editing by Franklin Paul and Paul Simao)