Fortress Investment’s 2nd Quarter Comes in Higher than Expected

August 6, 2010

Hedge fund Fortress Investment Group, LLC recently released their numbers for the second quarter, reflecting a larger loss than last year.  Considered to be largely based upon the distribution of stock-based compensation to their employees, the adjusted results of Fortress Investment Group ultimately exceeded the expectations of many analysts on Wall Street.

Fortress Investment Group’s loss totaled $251.2 million, or 57 cents per share, in the three months of the second quarter ending June 30th.  Last year, the company reflected a loss of $171.3 million, or 41 cents per share.

Analysts to point to some high points on Fortress Investment Group’s balance sheet, however.  Pre-tax distributable earnings rose 14 cents per share to a total of $73 million, up last year from $59 million, or 12 cents per share.

Analysts polled by Thomson Reuters had predicted distributable earnings of an average of 8 cents per share.

Fortress’ total annual revenue rose 27%, or $52.2 million, to $191.3 million, up from $139.1 million last year.  This rise is attributed to the company’s increase in management fees, incentive income, and expense reimbursements from their affiliates.

Fortress’ distributable earnings do not include such charges as compensation for principals of the firm, stock-based compensation, and one-time gains & losses on options and other investments.