Citadel Limited Partnership

The stable outlook indicates S&P Global Ratings' view that CLP will generate strong adjusted EBITDA margins above 80% (net of expense reimbursements), leverage below 1.5x (as measured by debt to adjusted EBITDA), and interest coverage above 15.0x in the next 18-24 months. The stable outlook also reflects our expectation that CLP will maintain or modestly build its AUM and maintain its solid investment performance. We could lower the rating if earnings decline so that leverage increases to 2.0x or more on a sustained basis, investment performance or profitability seriously deteriorates, or if Citadel experiences large net outflows beyond distributions in the ordinary course of business. While it's unlikely, we could raise the rating if CLP increases earnings from stable sources

...Citadel Limited Partnership (CLP) maintains solid investment returns. Despite returns normalizing in 2023 after a very strong 2022, Citadel remained one of the top hedge fund performers throughout the year. Its flagship Wellington fund generated returns of 15.3% in 2023. We anticipate CLP will continue operating with leverage below 1.5x over the next two years. Strong performance boosted AUM to $56.6 billion as of Jan. 1, 2024, from $53.7 billion the prior year, despite management voluntarily returning approximately $7 billion of capital to investors throughout the year. Since 2017, CLP's funds have voluntarily distributed more than $25 billion in capital back to its investors. High returns also boosted EBITDA, supporting our base case expectation for leverage. The company's sizable internal capital aligns the interests of CLP principals and employees with those of external investors. Internal capital from Citadel principals and employees constitutes about 29% of investment capital. The...

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