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Fortress Reports Third Quarter 2012 Results And Announces Dividend Of $0.05 Per Share

Stocks in this article: FIG

SUMMARY FINANCIAL RESULTS

Fortress’s business model is highly diversified, and management believes that this positions the company to capitalize on opportunities for investing, capital formation and harvesting profits that can occur at different points in any cycle for our individual businesses. Fortress’s business model generates stable and predictable management fees, which is a function of the majority of alternative assets under management residing in long-term investment structures. Fortress’s alternatives businesses also generate variable incentive income based on performance, and this incentive income can contribute meaningfully to financial results. Balance sheet investments represent a third component of Fortress’s business model, and the company has built substantial value in these investments, which are made in Fortress funds alongside the funds’ limited partners.

The table below summarizes Fortress’s operating results for the three and nine months ended September 30, 2012. The consolidated GAAP statement of operations and balance sheet are presented at the end of this press release.

  3Q   2Q   3Q   % Change   YTD September   % Change
2012 2012 2011 QoQ   YoY 2012   2011 YoY
(in millions, except per share amount)    
GAAP
Net income (loss) $ 7 $ 14 $ (382 ) -53 % N/M $ (3 ) $ (883 ) N/M
Net income (loss) attributable to Class A Shareholders $ 1   $ 5   $ (142 )   -86 %   N/M   $ (24 ) $ (340 ) N/M  
Per diluted share $ (0.04 ) $ (0.12 ) $ (0.83 )   N/M     N/M   $ (0.13 ) $ (1.88 ) N/M  
Weighted average Class A shares outstanding, diluted 520 516 496 517 492

 

Distributable Earnings (non-GAAP)
Fund management DE $ 63 $ 53 $ 51 19 % 24 % $ 172 $ 200 -14 %
Pre-tax DE $ 64   $ 50   $ 43     28 %   49 % $ 171   $ 192   -11 %
Per dividend paying share/unit $ 0.12   $ 0.09   $ 0.08     27 %   47 % $ 0.32   $ 0.36   -12 %
Weighted average dividend paying shares and units outstanding 537 533 530 534 527
 
Assets Under Management
Private Equity $ 14,718 $ 13,826 $ 12,708 6 % 16 % $ 14,718 $ 12,708 16 %
Credit 11,753 11,452 11,833 3 % -1 % 11,753 11,833 -1 %
Liquid Markets 4,378 4,398 6,165 0 % -29 % 4,378 6,165 -29 %
Logan Circle   20,626     18,112     12,913     14 %   60 %   20,626     12,913   60 %
Total Assets Under Management $ 51,475   $ 47,788   $ 43,619     8 %   18 % $ 51,475   $ 43,619   18 %
 

CONSOLIDATED GAAP RESULTS

Fortress recorded GAAP net income of $7 million, or a $0.04 loss per diluted share in the third quarter of 2012, compared with a GAAP net loss of $382 million, or $0.83 loss per diluted share, in the third quarter of 2011. Our diluted loss per share for all periods presented includes the income tax effects to net income (loss) attributable to Class A Shareholders from the assumed conversion of Fortress Operating Group Units and fully vested Restricted Partnership Units to Class A shares.

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