NEW YORK (Reuters) – Private equity and real estate company Blackstone Group (BX.N: Quote, Profile, Research) reported a first-quarter loss on Thursday as turbulent markets cut into the accounting value of its investments.
The loss of $93.6 million, excluding income taxes, noncash charges for vesting equity-based compensation and amortization of intangible assets, compares with a year-earlier profit of $957.8 million.
Blackstone prefers to focus on this measure, which it calls “economic net income,” because of the huge payouts associated with its more than $4 billion initial public offering in June.
The economic net loss after taxes was 6 cents a share, compared with a year-earlier profit of 75 cents. Analysts on average were expecting earnings of 11 cents, according to Reuters Estimates.
Blackstone's shares were up 6 cents at $19.56 in early New York Stock Exchange trade.
“Turbulent markets throughout the world persisted in the first quarter, affecting virtually all asset pricing across credit and equity markets,” Chief Executive Stephen Schwarzman said in a statement.
This meant lower carrying values for some investments, he said, but also resulted in declining purchase prices for new deals, “opening up many interesting investment possibilities.”
Blackstone adjusts the value of its investments every quarter for accounting purposes, known as the “carrying value.”
(Reporting by Megan Davies, editing by Gerald E. McCormick and Lisa Von Ahn)