Blackstone bolsters its earnings after superfund starts to pay out

Michael Bow
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WALL STREET titan Blackstone yesterday disappointed investors despite profits rising by nearly a fifth during the quarter.

The listed private equity group, which also has a substantial prop­erty arm, said economic net income (ENI) – a common measure of profit in the industry – rose 18 per cent to $758m (£471m) for the quarter ending September.

However, shares fell as much as seven per cent in early trading in the US after investors had banked on a slightly higher ENI figure.

Blackstone is led by Steve Schwarz­man, and has held stakes in a variety of UK-focused companies such as Legoland owner Merlin Entertain­ments, and clothing line Jack Wolfskin.

Performance fees, which are paid out to Blackstone by investors if certain targets are met, rose 64 per cent from the same quarter last year to $891.1m.

Blackstone is currently reaping the benefits of its $21.7bn fund from 2005, the largest pool of private equity capital ever raised, which is now starting to pay out performance fees to the group.

BCP V, as it is known, generated $147m of fees during the quarter, taking the total fees from the fund this year to $766m.