Carlyle to repurchase $200 million of its shares
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Version 0 of 1. The Carlyle Group announced a $200 million stock buyback Wednesday, a first for the company. The move comes after the District-based private equity giant saw its stock drop by half during the past year. “We’re putting our money where our mouth is,” said Carlyle President Glenn Youngkin. “Few people argue with our ability to pick good investments.” The stock repurchase announcement was part of Carlyle’s fourth-quarter earnings report that saw economic net income, a key measure, drop to $73 million from $181 million for the same quarter of 2014. That came to 24 cents a share, lower than the 31 cents predicted by some analysts. Carlyle’s net economic income for all of 2015 was $397 million. Carlyle’s miss is a reflection of the beleaguered world finance industry and private equity in particular. Banks, private equity and other financial firms are suffering from a global slowdown, decade-low oil prices and expectations that interest rates will rise. Low rates and cheap borrowing are key components to private equity, which borrows heavily when buying firms that it fixes and resells at big profits. “We expect a tougher environment over the next few years, but it is in this type of environment that we expect to see the best opportunities,” said Carlyle co-chief executive William E. Conway, Jr. on a conference call with analysts. KKR & Co., Apollo Global Management and Fortress Investment Group have all announced stock buybacks. Blackstone Group co-founder and chief executive Stephen Schwarzman recently declared his company’s share “on sale” because of the low stock price. Carlyle also declared Wednesday a quarterly distribution of 29 cents per share for the fourth quarter, which puts the 2015 overall dividend at $2.07 per share. With shares hovering around $12 Wednesday, the dividend yield comes to 17.5 percent. Founded in 1987, Carlyle has $188 billion of assets under management in hundreds of investment vehicles. |