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Oaktree Capital Group, LLC Announces Third Quarter 2012 Financial Results

Oaktree’s newest distressed debt fund, Oaktree Opportunities Fund IX, L.P. (“Opps IX”), has held its final closing and is expected to have total committed capital of $5.0 billion. Opps IX has not yet commenced its investment period, and thus it is not yet included in management fee-generating assets under management or incentive-creating assets under management. Oaktree has just begun marketing Oaktree Emerging Market Opportunities Fund, L.P., which will invest in distressed emerging market corporate debt. This new fund is expected to hold its first closing in the first quarter of 2013.

The table below presents unaudited: (a) fee-related earnings, distributable earnings, adjusted net income and economic net income, in each case for both the Operating Group and per Class A unit; and (b) assets under management and accrued incentives (fund level) data. Please refer to the Glossary for certain definitions.

As of or for the Three Months Ended September 30,

 

As of or for the Nine Months Ended September 30,

  2012     2011       2012     2011  
(in thousands, except per unit data or

as otherwise indicated)

Segment Results:
Fee-related earnings $ 73,049 $ 79,614 $ 235,539 $ 235,436
Fee-related earnings-OCG per Class A unit 0.40 0.39 1.22 1.08
Distributable earnings 120,363 109,385 434,047 439,112
Distributable earnings-OCG per Class A unit 0.70 0.52 2.42 2.23
Adjusted net income 157,732 3,301 496,874 351,677
Adjusted net income-OCG per Class A unit 0.88 (0.01 ) 2.67 1.82
Economic net income 368,000 (443,264 ) 750,028 52,298
Economic net income-OCG per Class A unit 2.22 (2.56 ) 4.28 0.21
 
Operating Metrics:
Assets under management (in millions):
Assets under management $ 80,967 $ 73,010 $ 80,967 $ 73,010
Management fee-generating assets under management 66,171 63,367 66,171 63,367
Incentive-creating assets under management 37,071 33,626 37,071 33,626
Uncalled capital commitments 13,262 12,376 13,262 12,376
Accrued incentives (fund level):
Incentives created (fund level) 446,401 (745,113 ) 702,447 (277,663 )
Incentives created (fund level), net of associated
incentive income compensation expense 246,960 (426,574 ) 405,806 (151,148 )
Accrued incentives (fund level) 2,138,553 1,517,277 2,138,553 1,517,277
Accrued incentives (fund level), net of associated
incentive income compensation expense 1,280,865 867,204 1,280,865 867,204
 

Note: Oaktree discloses in this earnings release certain financial measures, including fee-related earnings, fee-related earnings-OCG per Class A unit, distributable earnings, distributable earnings-OCG per Class A unit, adjusted net income, adjusted net income-OCG per Class A unit, economic net income and economic net income-OCG per Class A unit, that are calculated and presented on the basis of methodologies other than in accordance with generally accepted accounting principles in the United States (“non-GAAP”). Reconciliations of these non-GAAP financial measures to the most directly comparable financial measures calculated and presented in accordance with GAAP are presented in Exhibit A. All information in this earnings release gives effect to the conversion of previously outstanding 13,000 Class C units into Class A units on a one-for-one basis before the initial public offering of Class A units.

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