Updated from 10:36 a.m. EDT
Fortress Investment Group
saw its fourth-quarter loss balloon from a year ago as the firm faced a surge in investor redemptions and a barrage of writedowns.
The New York-based hedge fund operator reported a fourth-quarter net loss of $140 million, or $1.50 a share, compared with a year-ago loss of $29 million, or 43 cents a share. Fortress said revenue slumped 48% from a year ago to $158 million.
Fortress' pre-tax distributable losses, which exclude unrealized gains or losses on illiquid investments and certain types of expenses, but include contingent revenue, were $258 million in the quarter, compared to pre-tax distributable earnings of $78 million in the year-ago quarter.
Fortress also said it has set aside $299 million in reserves for potential clawback obligations to investors and asset writedowns.
At the end of November, Fortress temporarily suspended redemptions at its largest fund,
. After the suspension was lifted on Jan. 31, the fund saw redemptions totaling $3.3 billion. Fortress said it has paid $2.1 billion in redemption requests in cash and $900 million in shares of newly created vehicles that hold stakes in a pool of investments.
The remaining $300 million balance will be paid before the end of the month, the firm said.
Assets totaled approximately $29.5 billion at the end of the quarter, Fortress said, although that number fell to about $27.1 billion on Jan. 1 as fee-paying capital in funds no longer paid fees beginning in January.
Fortress said that its principal investments segment lost $265 million in the quarter, which included $228 million for investments in private-equity funds, a $27 million loss on the mark-to-market value of investments in hedge funds and $10 million of interest expenses.
Shares of Fortress were jumping 16.7% to $1.75. Among other capital management firms,
was rallying 4.1%,
was higher by 3.9% and
Och-Ziff Capital Management
was higher by 0.6%.