Petershill Partners (PHLL) Q3 2024 TU earnings summary

Executive summary

• Gross fee-eligible AuM raised $9bn in Q3 and $23bn year-to-date, with aggregate partner-firm AuM at $328bn and fee-paying AuM at $233bn as of 30 September 2024.

• Partner-firm AuM and fee-paying AuM increased 8% and 18% year-over-year, despite a 1% and 2% sequential decline due to the LMR Partners stake disposal.

• Partner Fee Related Earnings (FRE) rose 8% year-over-year to $57m in Q3, driven by higher net management and advisory fees.

• Partner Distributable Earnings reached $90m in Q3, up 13% year-over-year, reflecting higher FRE and realised performance revenues.

• Strategic disposals included the LMR Partners stake for up to $258m and a partial sale of Accel-KKR for $282m, both at premiums to carrying values.

Financial highlights

• Net management and advisory fees were $97m in Q3, up 7% year-over-year; management fees alone were $96m, down 1% year-over-year.

• Transaction and advisory fees totaled $5m in Q3, compared to zero a year ago.

• Partner Realised Performance Revenues (PRE) were $23m in Q3, up from $14m in Q3 2023; Partner Realised Investment Income was $10m, down from $13m.

• Aggregate nominal consideration from 2024 partner-firm stake sales reached $575m, a 19% premium to carrying value.

• $449m of total capital return announced in 2024, with $888m paid or announced since 2022.

Outlook and guidance

• 2024 organic fee-eligible AuM raise expected at the top end of $20-25bn guidance; realisations to slightly exceed $5-10bn range.

• Full-year Partner FRE guidance unchanged at $200-230m; PRE expected at 15%-30% of total Partner Revenues.

• Acquisitions in 2024 anticipated within $100-300m range; Adjusted EBIT margin guidance remains at 85-90%.

• Rest of 2024 guidance reiterated as of interim results on 17 September 2024.