KKR & Co Inc Q4 2024 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Craig Siegenthaler - Bank of America - Analyst : Our question is on the investing outlook across the firm. So the consensus outlook for '25 was always stronger, but the macro has become a little bit more challenging versus 90 days ago. You can see this in the 10-year and the VIX. So sitting here today in January, what is the investment outlook for 2025 relative to last year? And what has been the sensitivity to some of the macro trends that have developed. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 04, 2025 / 3:00PM, KKR.N - Q4 2024 KKR & Co Inc Earnings Call

Question: Benjamin Budish - Barclays - Analyst : Maybe a follow-up on Craig's question, thinking about the 2025 outlook. Maybe just start, could you give us a little bit of an update on the Americas fundraise. But in terms of 2025, just maybe tying that into how should we think about sort of the trajectory of management fee growth into the year. There's obviously some dynamics with catch-up fees, timing of lend activations. But curious on those two items, the Americas fund and how we should think about broader 2025 management fee growth.

Question: Alexander Blostein - Goldman Sachs - Analyst : I was hoping we can go back to the Strategic Holdings announcements, obviously, an important stuff for you guys. Could you just maybe walk us through sort of why now, why is now the right time to add when you're looking across the 18 portfolio companies that you have, what is the percentage that KKR owns today on balance sheet? And I guess, what percentage of any portfolio company would you feel comfortable owning over time?

Question: William Katz - TD Cowen - Analyst : Just wondering if you could maybe double click into the wealth management opportunity. You spoke very constructively about the outlook from here. Just sort of wondering where you sort of see the greatest opportunity. I know it's a fairly depth -- in-depth question just from a multi-vector perspective, a product or a geography or a distribution channel. And I was wondering if you could tie that to your outlook for the other expense line as we should think about further scaling of the platform? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 04, 2025 / 3:00PM, KKR.N - Q4 2024 KKR & Co Inc Earnings Call

Question: Glenn Schorr - Evercore ISI - Analyst : A question in real assets and infra. You obviously grew a big, diversified platform very well. There's these huge TAMs that we've been seeing in data warehouse power. You have your recent partnership with Energy Capital, you have some recent power company acquisitions. So my question is, has anything changed on the heels of DeepSeek? Has it changed the way you think about prices paid on recent assets and or demand in the future for what everybody seems to be building in this tremendous data-oriented addressable market?

Question: Daniel Fannon - Jefferies - Analyst : Can you talk to the monetization environment and how you're thinking about that as we start 2025 and really how you see it progressing this year? And what gives you confidence, which I assume is a bit more of a positive outlook on that activity level versus what we've seen in previous periods.

Question: Michael Cyprys - Morgan Stanley - Analyst : Just a question on asset-based finance. I was hoping maybe you could update us on the platform today. The progress that you made over the past year. And as you look ahead to '25, just maybe you can give us a sense of some of the steps you guys are going to be taking to further expand the sourcing funnel and bank partnerships of the like -- how do you see that coming together? And as you look out over the next couple of years, maybe you can kind of give us a little bit more of a flavor sense for how you see this evolving.

Question: Steven Chubak - Wolfe Research, LLC - Analyst : So I wanted to ask a question on the fundraising outlook. Asked a similar one last quarter. But Scott, just borrowing from the running analogy, you noted that you guys achieved $114 billion of fundraising and that was with little contribution from flagships and some tougher market conditions. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 04, 2025 / 3:00PM, KKR.N - Q4 2024 KKR & Co Inc Earnings Call So given the upcoming fundraising super cycle in '25, some better conditions you cited, I was hoping you could frame the upside potential versus that $100 billion fundraising target and the sustainability of some of the drivers of strength in '24, whether that should continue into '25.

Question: Michael Brown - Wells Fargo - Analyst : Got some questions on the performance on slide 10. I just wanted to ask about the 0% return or kind of the flat return quarter over quarter for the traditional PE full-year result that 14% is certainly good. But I guess why flat quarter over quarter, was there something to call out that drove that? And then does the buyout land, the trend of public to private has certainly been a very popular theme. How are you thinking about opportunities here? And what are some of the key themes you're leaning into now?

Question: Michael Brown - Wells Fargo - Analyst : Great. Scott. And thank you, Craig. I definitely understand that the quarterly moves are just one data point about the bigger trend. So thank you for that.

Question: Vikram Gandhi - HSBC - Analyst : My question is really related to GA. Looking at the growth in the adjusted book value versus the operating earnings, it appears that the group has been injecting about $400 million of capital each quarter last year. The impression I had was that GA was quite well capitalized even considering a reasonable growth. So I wondered how should we think about the growth going forward in the earnings run rate for 2025?

Question: Christoph Kotowski - Oppenheimer & Co. - Analyst : Yes. I was just wondering if you could expand on the question you had earlier about the flagship private equity funds. And I guess just I'm looking at Infrastructure V and the Global Climate Fund, there are still raising money, but don't look like they've made investments yet. And I'm wondering how long is that investment period open? And should we expect kind of meaningful catch-up fees there at some point? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 04, 2025 / 3:00PM, KKR.N - Q4 2024 KKR & Co Inc Earnings Call And then on Europe and Asia, those funds look like they're roughly half called when should we expect fundraising to commence for those successor funds?

Question: Patrick Davitt - Autonomous Research - Analyst : Just quickly back on the monetization theme. Could you give the usual visible realized cash flow stat that you give? And then more broadly, another firm made it pretty clear, I think, last week that they thought this monetization theme was more a second half event it sounds like today, you might think the situation is different for KKR. Is that the case? Or do you agree it could be more of a second half event? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 04, 2025 / 3:00PM, KKR.N - Q4 2024 KKR & Co Inc Earnings Call