Q3 2024 DigitalBridge Group Inc Earnings Call Transcript
Key Points
- DigitalBridge Group Inc (DBRG) reported a 42% year-on-year increase in fee-related earnings (FRE) and a 500 basis point improvement in fee margins to 34%.
- The company is on track to exceed its $7 billion annual fundraising target, having already raised $6.1 billion year-to-date.
- DBRG has successfully deployed capital into existing platforms and new opportunities, particularly in the data center and tower verticals, with significant investments in companies like Databank and Vertical Bridge.
- The private wealth channel has shown early success, with expectations to raise over a billion dollars by the end of the year, which was not initially factored into the 2024 business plan.
- DBRG's global platform and growing investor base have enabled it to raise capital from around the world, with strong contributions from North America and Asia expected in the fourth quarter.
- The company revised its fee-earning equity under management (FEEUM) target downward slightly to $35 billion to $37 billion due to realizations and other offsets.
- Fee revenue for 2024 is expected to fall short of the original guidance, with a revised range of $305 million to $320 million, compared to the initial target of $335 million to $360 million.
- The composition of capital raised has skewed more towards co-investment and funds that charge fees on invested capital, resulting in lower fee revenue for 2024.
- There was a net carried interest reversal of $7.7 million in the third quarter, attributed to portfolio evaluations that were roughly in line with preferred returns.
- The timing of capital formation has impacted the ability to deliver in-period FRE as expected, with some fundraising activities rolling over into 2025.
Greetings and welcome to the Digital Bridge Group Inc third quarter, 2024 earnings call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. (Operator instructions)
It is now my pleasure to introduce your host, Severin White, Managing Director, head of Public Investor Relations. Thank you. You may begin.
Good morning, everyone and welcome to Digital Bridges third quarter, 2024 earnings conference call. Speaking on the call today from the company is Marc Ganzi our CEO and Thomas Mayrhofer our CFO.
I'll quickly cover the safe harbour some of the statements that we make today regarding our business operations and financial performance may be considered forward-looking and such statements involve a number of risks and uncertainties that could cause actual results to differ materially. All information discussed on this call is as of today, November 1, 2024, and Digital Bridge
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