Phiwath Jittamas/iStock via Getty Images The following segment was excerpted from Greenhaven Road Capital Main Fund Q1 2025 Investor Letter. Lifecore Biomedical (LFCR) - As previously discussed, Lifecore is a likely beneficiary of the trade policies. Their largest challenge and opportunity is ...

Core Insights - The article emphasizes the importance of a hybrid investment strategy that combines classic dividend growth stocks with Business Development Companies, REITs, and Closed End Funds to enhance investment income while achieving total returns comparable to traditional index funds [1]. Investment Strategy - The investment approach focuses on high-quality dividend stocks and assets that provide long-term growth potential, which can significantly contribute to income generation [1]. - A balanced portfolio that includes both growth and income-generating assets can lead to efficient investment income while maintaining a total return aligned with the S&P [1].

Group 1 - FS KKR Capital's quarterly earnings met expectations, indicating stable financial performance [1] - The quality of FS KKR Capital's balance sheet improved quarter-over-quarter, suggesting enhanced financial health [1] - The company supported its dividend through net investment income, reflecting strong operational performance [1] Group 2 - FS KKR Capital is actively growing its portfolio through new investments, indicating a strategic focus on expansion [1]

Financial Performance - Total revenues for the three months ended March 31, 2025, were $3,110,183, a decrease of 67.7% compared to $9,656,738 in the same period of 2024[36]. - Net income for the three months ended March 31, 2025, was $684,498, down 37.4% from $1,093,850 in 2024[37]. - The company reported a net loss attributable to common stockholders of $(185,924) for Q1 2025, compared to a profit of $682,214 in Q1 2024[37]. - Comprehensive income for the three months ended March 31, 2025, was $2,095,968, significantly higher than $911,648 in the same period of 2024[41]. - The company reported net gains from investment activities of $1,086,591 for Q1 2025, compared to $638,162 in Q1 2024, marking a growth of 70.0%[36]. - The company reported a net unrealized loss of $(335,565) in asset management and strategic holdings for the three months ended March 31, 2025[170]. Assets and Liabilities - Total assets increased to $372,372,919 thousand as of March 31, 2025, up from $360,099,411 thousand at December 31, 2024, representing a growth of approximately 3.5%[26]. - Total liabilities increased to $303,415,987 thousand as of March 31, 2025, compared to $298,114,719 thousand at December 31, 2024, marking a rise of approximately 1.1%[27]. - Stockholders' equity grew to $67,035,452 thousand, up from $60,399,515 thousand, indicating an increase of about 11.0%[27]. - The total investments as of March 31, 2025, amounted to $285,850,575, an increase from $276,597,795 as of December 31, 2024[77]. - The total liabilities at fair value as of March 31, 2025, amounted to $33.70 billion, an increase from $33.32 billion as of December 31, 2024, reflecting a growth of approximately 1.1%[146]. Investment Activities - Net investment income increased to $1,783,280 for Q1 2025, compared to $1,519,902 in Q1 2024, reflecting a growth of 17.3%[36]. - Total investments purchased in insurance for Q1 2025 amounted to $24,919,638, significantly higher than $13,726,204 in Q1 2024[48]. - Proceeds from investments in insurance for Q1 2025 were $21,793,291, compared to $7,528,657 in Q1 2024, indicating a substantial increase[48]. - The company reported unrealized losses on fixed maturity securities classified as trading of $99,579 in Q1 2024, which improved to unrealized gains of $259,207 in Q1 2025[73]. Cash Flow and Operating Activities - Net cash provided by operating activities increased to $2,549,726 in Q1 2025, up 67.0% from $1,527,433 in Q1 2024[44]. - The net cash used in investing activities for Q1 2025 was $(3,147,312), an improvement from $(6,198,779) in Q1 2024[48]. - KKR's net cash provided by financing activities in Q1 2025 was $3,603,104, a significant increase compared to $44,964 in Q1 2024[48]. Insurance Operations - Total insurance liabilities increased from $4,041,894 million in Q1 2024 to $4,338,050 million in Q1 2025, representing a growth of 7.3%[154]. - The total balance of funds withheld payable at interest decreased from $(2,447,303) million in Q1 2024 to $(2,373,981) million in Q1 2025, a reduction of 3.0%[154]. - The company reported a change in total liabilities of $162,223 million for insurance in Q1 2025, compared to $234,067 million in Q1 2024, reflecting a decrease of 30.7%[154]. Equity and Stockholder Information - The Series D Mandatory Convertible Preferred Stock issued increased to 51,750,000 shares as of March 31, 2025, compared to zero shares at December 31, 2024[27]. - Basic net income (loss) per share of common stock for Q1 2025 was $(0.22), a decrease from $0.77 in Q1 2024[13]. - The weighted average shares of common stock outstanding for basic calculations increased to 888,246,698 in Q1 2025 from 885,005,824 in Q1 2024[13]. Future Outlook and Strategic Initiatives - The company plans to expand its market presence through strategic acquisitions and new product developments in the upcoming quarters[149]. - Future guidance suggests a continued focus on enhancing operational efficiency and exploring new technology innovations[149].

Core Viewpoint - FS KKR Capital Corp. reported strong financial results for the quarter ended March 31, 2025, with a declared distribution of $0.70 per share, reflecting stability amid market volatility [1][4][3]. Financial and Operating Highlights - Adjusted Net Investment Income was $0.65 per share, with net investment income of $0.67 per share, compared to $0.61 per share for the previous quarter [8][28]. - The company originated approximately $2.0 billion in new investments during the quarter [3]. - Total investment income for the quarter was $400 million, down from $434 million in the same quarter of the previous year [24]. Portfolio Highlights - The total fair value of investments increased to $14.1 billion from $13.5 billion at the end of 2024 [6][9]. - Senior secured loans represented 58.1% of the portfolio, with 67.2% of debt investments being variable rate [6][9]. - Investments on non-accrual status were 2.1% of the total investment portfolio at fair value [9]. Leverage and Liquidity - The net debt to equity ratio was 114%, with total debt outstanding of $8.0 billion and stockholders' equity of $6.5 billion [10][8]. - Cash and cash equivalents stood at $472 million, with an additional $2.6 billion available under financing arrangements [10]. Earnings and Distributions - Earnings per share for the quarter were $0.43, down from $0.52 in the previous quarter [8][25]. - The company paid distributions totaling $0.70 per share to stockholders [8][4]. Additional Information - FS KKR Capital Corp. focuses on providing customized credit solutions to private middle-market U.S. companies, primarily investing in senior secured debt [14].

Core Insights - KKR & Co. Inc. reported a revenue of $1.2 billion for the quarter ended March 2025, reflecting a year-over-year increase of 21.7% and an EPS of $1.15, up from $0.97 in the same quarter last year, surpassing the Zacks Consensus Estimate for revenue by 0.90% and for EPS by 1.77% [1] Financial Performance - The company raised $30.54 billion in new capital, exceeding the average estimate of $24.74 billion [4] - Private Equity assets under management (AUM) reached $209.40 billion, compared to the average estimate of $200.41 billion [4] - Fee Paying AUM was reported at $526.05 billion, slightly below the average estimate of $526.99 billion [4] - Real Assets Segment's fee-paying AUM was $144.03 billion, above the average estimate of $143.57 billion [4] - Operating earnings from strategic holdings were $31.49 million, exceeding the average estimate of $25.26 million [4] - Fee related compensation was reported at -$210.02 million, better than the average estimate of -$211.66 million [4] - Fee related earnings from performance revenues were $21.28 million, below the average estimate of $24.99 million but showing an 11.4% increase year-over-year [4] - Operating earnings from insurance were $258.77 million, slightly above the average estimate of $255.09 million, representing a year-over-year decline of 5.2% [4] - Management fees generated $917.33 million, compared to the average estimate of $927.90 million, reflecting a year-over-year increase of 12.5% [4] - Total revenues from fee related earnings were $822.60 million, below the average estimate of $842.17 million [4] - Net realized investment income was $185.26 million, slightly below the average estimate of $187.68 million [4] - Total investing earnings were reported at $273.25 million, exceeding the average estimate of $271.37 million [4] Stock Performance - KKR & Co. shares have returned -5.5% over the past month, underperforming the Zacks S&P 500 composite, which changed by -0.7% [3] - The stock currently holds a Zacks Rank 5 (Strong Sell), indicating potential underperformance in the near term [3]

Core Insights - KKR & Co. Inc. reported an adjusted net income per share of $1.15 for Q1 2025, exceeding the Zacks Consensus Estimate of $1.13 and up from $0.97 in the prior-year quarter [1] - The company's total revenues reached $1.2 billion, a 21.6% increase year-over-year, driven by higher management fees and transaction fees, surpassing the Zacks Consensus Estimate of $1.19 billion [3] - Total assets under management (AUM) grew 14.8% year-over-year to $664.3 billion, with fee-paying AUM increasing 11.7% to $526 billion [4] Financial Performance - KKR's total operating earnings rose 15.6% year-over-year to $1.11 billion, supported by a 23% increase in fee-related earnings to $822.6 million [5] - The net loss attributable to the company on a GAAP basis was $185.9 million, contrasting with a net income of $682.2 million in the same quarter last year [2] - Total segment expenses increased by 18.8% to $377.5 million, reflecting the company's ongoing expansion and operational costs [3] Market Position and Outlook - KKR is expected to leverage its strong fundraising capabilities to capitalize on lucrative investment opportunities in the future [6] - The company is experiencing significant growth in fee-related and total operating earnings, although elevated expenses due to global expansion and a challenging operating environment are concerns [6] - KKR currently holds a Zacks Rank of 5 (Strong Sell), indicating market sentiment towards the stock [7]

Financial Data and Key Metrics Changes - Fee related earnings per share increased to $0.92, up 22% year over year [4] - Total operating earnings rose to $1.24 per share, up 16% year over year [4] - Adjusted net income reached $1.15 per share, up 19% compared to the previous year [4] - Management fees for Q1 were $917 million, up 13% year over year, driven by fundraising and deployment activities [5] - Total fee related revenues amounted to $1.2 billion, reflecting a 22% increase year over year [6] Business Line Data and Key Metrics Changes - Insurance segment operating earnings were $259 million, in line with expectations [26] - Strategic holdings operating earnings were $31 million, slightly ahead of guidance [7] - Realized performance income was $348 million, and realized investment income was $218 million, totaling $566 million in monetization activity, up nearly 40% year over year [10] - The private equity portfolio increased by 4% in the quarter and 11% over the last twelve months [10] Market Data and Key Metrics Changes - The company raised $31 billion in new capital during the quarter, with significant contributions from North America private equity strategy [21] - The K Series suite of vehicles saw AUM grow to $22 billion, compared to $9 billion a year ago [23] - The private credit component of AUM grew to $117 billion, with asset-based finance growing between 35% and 40% year over year [71] Company Strategy and Development Direction - The company aims to leverage its diversified business model to source attractive investment opportunities globally [13] - Focus on capital raising efforts remains strong, with no changes to targets despite market volatility [21] - The strategic holdings segment is viewed as a differentiator, with ongoing acquisitions to enhance the portfolio [8] - The company is committed to evolving its insurance strategy to include longer-duration assets, aiming for a pretax ROE of over 20% [29] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating current market volatility, emphasizing the importance of a global and diversified approach [34] - The company anticipates continued investment opportunities despite potential delays in some sale processes [36] - There is optimism regarding monetization activity, with a record gross unrealized performance income of $8.7 billion, up over 25% year on year [19] Other Important Information - The company increased its dividend to $0.74 per share on an annualized basis, marking the sixth consecutive year of dividend increases [12] - The firm has $116 billion of committed but uncalled capital, providing stability and visibility for future management fees [30] Q&A Session Summary Question: Impact of the emerging trade war on Asia business - Management indicated no change to strategy, emphasizing lessons learned from past experiences with tariffs and supply chain issues [45] Question: Resilience of private wealth flows - Management noted that strong relative performance and low adoption rates could drive future growth in private wealth [49] Question: Why not increase share buybacks given stock performance? - Management reiterated a consistent capital allocation strategy focused on maximizing long-term earnings per share and quality of earnings [61] Question: Update on asset-backed finance platform - Management highlighted significant growth in asset-based finance, with a healthy deployment of over $4 billion in Q1 [74] Question: Expectations for flagship fundraising in 2025 - Management expects a barbell approach to fundraising, with significant capital coming in at initial and final closes [107]

Financial Data and Key Metrics Changes - Fee related earnings per share increased to $0.92, up 22% year over year [6] - Total operating earnings rose to $1.24 per share, reflecting a 16% year over year increase [6] - Adjusted net income reached $1.15 per share, up 19% compared to the previous year [6] - Management fees for Q1 were $917 million, a 13% increase year over year, driven by fundraising and deployment activities [7] - Total fee related revenues amounted to $1.2 billion, up 22% year over year [8] Business Line Data and Key Metrics Changes - Insurance segment operating earnings were $259 million, in line with guidance [9] - Strategic holdings operating earnings reached $31 million, slightly ahead of guidance [9] - Realized performance income was $348 million, and realized investment income was $218 million, totaling $566 million in monetization activity, up nearly 40% year over year [11] - The private equity portfolio increased by 4% in the quarter and 11% over the last twelve months [12] Market Data and Key Metrics Changes - The company raised $31 billion in new capital during the quarter, with significant contributions from North America private equity strategy [22] - The K Series suite of vehicles saw AUM grow to $22 billion, compared to $9 billion a year ago [25] - The asset-based finance segment grew significantly, with AUM in private credit reaching $117 billion, and asset-based finance growing between 35% and 40% year over year [71] Company Strategy and Development Direction - The company is focused on leveraging its global and diversified business model to source attractive investment opportunities amid market volatility [15] - There is a strong emphasis on capital raising efforts, with no changes to targets despite market conditions [22] - The company aims to build long-term investment vehicles that will perform well over time, rather than focusing on short-term capital raises [95] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating current market volatility and highlighted the potential for attractive investment opportunities [15] - The company believes that its diversified portfolio is well-positioned to manage challenges posed by tariffs and supply chain issues [16] - There is optimism regarding deployment and monetization, with a record amount of gross unrealized performance income at $8.7 billion, up over 25% year on year [20] Other Important Information - The company increased its dividend to $0.74 per share on an annualized basis, marking the sixth consecutive year of dividend increases [14] - The insurance segment is evolving to source liabilities and assets more effectively, with expectations of stable operating earnings around $250 million [27] Q&A Session Summary Question: Impact of the emerging trade war on Asia business - Management indicated no change to strategy, emphasizing lessons learned from past experiences with tariffs and supply chain issues [46] Question: Resilience of private wealth flows and potential acceleration - Management noted that strong relative performance and low adoption rates could drive future growth in private wealth channels [50] Question: Why not increase share buybacks now? - Management reiterated a consistent capital allocation strategy focused on maximizing long-term earnings per share and quality of earnings [61] Question: Update on asset-backed finance platform - Management highlighted significant growth in asset-based finance, with a strong deployment environment expected [74] Question: Expectations for capital markets fees and transaction focus - Management noted that capital markets fees were solid in Q1, with a strong pipeline for Q2, although they may be slightly lower than Q1 [81]

Financial Performance - KKR reported a GAAP net income attributable to common stockholders of $(0.2) billion for Q1 2025, compared to $2.2 billion in the last twelve months (LTM) [22]. - Total revenues for Q1 2025 were $15.3 billion, a decrease from $21.0 billion in the LTM, with asset management and strategic holdings revenues at $7.3 billion [23]. - Total Operating Earnings (TOE) for Q1 2025 were $1.1 billion, a 16% increase year-over-year, with LTM TOE at $4.5 billion, up 32% year-over-year [25]. - Adjusted Net Income for 1Q'25 was $4,372.5 million, compared to $3,184.6 million in 1Q'24 [28]. - KKR's adjusted net income for 1Q'25 was $1,033,988, up from $863,745 in 1Q'24, showing an increase of approximately 19.7% [134]. - KKR's net income attributable to KKR common stockholders for 1Q'25 was $(185,924), compared to $682,214 in 1Q'24, indicating a significant loss [131]. - Total expenses for 1Q'25 were $15,503,871, compared to $18,811,466 in 1Q'24, reflecting a decrease of about 17.3% [130]. - The company reported net investment income of $6,837,986 for 1Q'25, an increase from $5,734,107 in 1Q'24, representing a growth of about 19.3% [130]. Revenue and Earnings Growth - Fee Related Earnings (FRE) for Q1 2025 were $823 million, up 23% year-over-year, with LTM FRE at $3.4 billion, up 37% year-over-year [25]. - Total Segment Earnings for 1Q'25 were $5,740.8 million, compared to $4,329.9 million in 1Q'24 [28]. - Fee Related Earnings reached $3,421.7 million for the last twelve months (LTM), up from $2,503.9 million in the previous LTM [36]. - Management Fees increased by 15% to $3,563.4 million in the LTM, supported by an increase in Fee Paying AUM [39]. - Total Asset Management Segment Revenues for the last twelve months (LTM) were $7,495,227, showing a significant increase from $5,676,328 [138]. Assets Under Management (AUM) - Assets Under Management (AUM) reached $664 billion, reflecting a 15% increase year-over-year, while Fee Paying Assets Under Management (FPAUM) were $526 billion, up 12% year-over-year [25]. - Performance Fee Eligible AUM increased by 16% year-over-year to $398 billion [52]. - Total AUM increased from $637.6 billion to $664.3 billion over the three months ended March 31, 2025, a growth of approximately 4.2% [101]. - The change in value for total AUM was $9.16 billion, driven by positive market performance across various asset classes [101]. - KKR's Assets Under Management (AUM) includes the fair value of investments, uncalled capital commitments, and the asset value of Global Atlantic insurance companies, totaling significant capital raising activities [172]. Capital Raising and Investments - KKR raised $31 billion in new capital during Q1 2025 and $114 billion in the LTM, with $19 billion capital invested in Q1 and $88 billion in the LTM [25]. - New Capital Raised in the quarter was $30.6 billion, contributing to a total of $113.6 billion in the LTM [37]. - The company raised $97.24 billion in new capital over the twelve months ended March 31, 2025, showcasing strong investor interest [104]. - KKR's capital allocation-based income for 1Q'25 was $3,454,447, down from $3,657,361 in 1Q'24, a decrease of approximately 5.6% [130]. - The company reported $10.8 billion in Uncalled Commitments across various investment strategies, indicating strong future investment potential [145]. Dividends and Share Repurchase - A regular dividend of $0.185 per share was declared for the quarter, representing a 6% increase on an annualized basis from the 2024 dividend [26]. - The company declared a dividend of $0.185 per share of common stock for Q1 2025, payable on May 27, 2025 [122]. - The share repurchase plan was increased by $500 million, with $462 million remaining available as of April 25, 2025 [127]. - The average price paid per share for share repurchases was $114.91, with a total of $107 million used to repurchase 0.9 million shares from December 31, 2024, to April 25, 2025 [125]. Strategic Initiatives and Future Outlook - KKR launched its first two public-private fixed income solutions for individual investors in April 2025, with plans for additional equity-oriented strategies in 2026 [25]. - Strategic Holdings Segment Earnings are expected to exceed $350 million by 2026, $700 million by 2028, and $1.1 billion by 2030, driven by strong operating performance and recent acquisitions [89]. - The company is focused on expanding into new investment strategies and geographic markets to enhance growth opportunities [189]. - KKR's Strategic Holdings segment is expected to contribute to future growth, with anticipated dividend payments from its companies [182]. Risks and Challenges - The company faces various risks, including market volatility, competition, and regulatory changes that could impact its business operations [188]. - KKR's ability to successfully integrate Global Atlantic and achieve its growth strategies is crucial for future performance [188]. - The company acknowledges that actual results may differ materially from forward-looking statements due to numerous uncertainties [185]. - KKR's reliance on third-party service providers and the potential impact of cybersecurity risks are significant concerns [189].