Och-Ziff Capital Management Q1 Profit Down - Quick Facts

(RTTNews) - Och-Ziff Capital Management Group LLC (OZM) reported that its GAAP net income allocated to Class A Shareholders for the first quarter ended March 31, 2014 was $23.9 million or $0.14 per Class A Share, down from $30.0 million or $0.20 per Class A Share for the 2013 first quarter. The year-over-year decline in the Company's GAAP results was primarily due to a combination of lower incentive income and higher compensation and benefits expenses, partially offset by an increase in management fees.

The Company's GAAP results in the 2014 first quarter were impacted by non-cash expenses of $27.1 million for equity-based compensation. These expenses primarily relate to Och-Ziff Operating Group A Units, which represent equity interests in the Company's principal operating subsidiaries, granted to executive managing directors, as well as Class A Restricted Share Units or "RSUs" granted to employees and executive managing directors. Each RSU represents the right to receive one Class A Share upon vesting. Vested Group A Units may be exchanged on a one-to-one basis for Class A Shares, subject to transfer restrictions and minimum retained ownership requirements.

The Company's Distributable Earnings for the 2014 first quarter were $127.8 million, or $0.25 per Adjusted Class A Share, lower than $136.9 million, or $0.29 per Adjusted Class A Share, for the 2013 first quarter. The year-over-year decrease in Distributable Earnings was primarily due to lower incentive income and an increase in compensation and benefits expenses, partially offset by an increase in management fees and lower non-compensation expenses.

As of March 31, 2014, assets under management totaled $42.6 billion, an increase of $7.6 billion, or 22%, from March 31, 2013, which was driven by capital net inflows of $4.2 billion and performance-related appreciation of $3.4 billion. These capital net inflows included $1.0 billion related to two CLOs that the Company closed in the year-over-year period, as well as $763.5 million related to the first close of the Company's third real estate fund, which occurred in the first quarter of 2014.

Total revenues for the quarter was $285.48 million, compared to $286.21 million last year.

Analysts polled by Thomson Reuters expected the company to report earnings of $0.16 per share and revenues of $165.97 million. Analysts' estimates typically exclude special items.

The Board of Directors of Och-Ziff declared a 2014 first-quarter dividend of $0.23 per Class A Share. The dividend is payable on May 19, 2014 to holders of record as of the close of business on May 12, 2014.