Blue Owl Capital Inc - Ordinary Shares (OWL) 1 Aug 24 2024 Q2 Earnings call transcript

In the second quarter of 2024, Blue Owl Capital, a leading alternative asset manager, held a highly anticipated earnings call that shed light on the company's financial performance and strategic direction. The call, led by Ann Dai, Head of Investor Relations, and featuring Marc S. Lipschultz, Co-Chief Executive Officer, and Alan Kirshenbaum, Chief Financial Officer, showcased a robust earnings report and highlighted several strategic initiatives that underscore Blue Owl's commitment to growth and innovation.

Financial Highlights

Blue Owl Capital reported fee-related earnings (FRE) of $0.21 per share and distributable earnings (DE) of $0.19 per share for the second quarter. The company also declared a dividend of $0.18 per share for the period, reflecting a strong financial performance. The company's FRE and DE have seen consistent growth over the past 13 consecutive quarters, a testament to the stability and strength of its business model.

Strategic Acquisitions

One of the most significant highlights of the call was the announcement of strategic acquisitions, including Atalaya Capital Management and Kuvare Asset Management. These acquisitions are expected to add substantial scale to Blue Owl's alternative credit capabilities, complementing its leading position in direct lending. The acquisition of Atalaya, a leading alternative credit manager, is particularly noteworthy, as it brings deep expertise in asset-based finance and a strong 18-year record through market cycles.

Diversification and Growth

Blue Owl Capital's strategic acquisitions underscore its commitment to diversification and growth. The company has seen impressive growth in its alternative credit and real estate credit capabilities, positioning itself to capitalize on the disruptive dynamics in these markets. With over $220 billion in assets under management (AUM) post-acquisition, Blue Owl is poised to become a significant player in the alternative credit space.

Operational Efficiency and Shareholder Value

The call also highlighted Blue Owl's focus on operational efficiency and shareholder value. The company's management fee and FRE growth have been impressive, with a 21% and 23% increase on a year-over-year basis, respectively. These figures underscore Blue Owl's ability to attract and retain clients, a testament to its compelling track record and investment strategies.

Outlook and Future Prospects

Looking ahead, Blue Owl Capital's outlook is optimistic, with a focus on organic and inorganic growth. The company's strategic acquisitions, coupled with its leading positions in direct lending, GP stakes, and triple net lease strategies, position it well for future success. With a strong balance sheet, a growing investor base, and a disciplined investment approach, Blue Owl Capital is well-positioned to capitalize on the opportunities in the alternative asset management industry.

In conclusion, Blue Owl Capital's earnings call provided a comprehensive overview of its financial performance and strategic direction. The company's impressive growth trajectory, strategic acquisitions, and focus on shareholder value are key indicators of its strength and potential for future success. As Blue Owl Capital continues to innovate and expand its offerings, it is poised to disrupt the alternative asset management industry and deliver value to its investors.