Tuesday, 30 June 2015
Last updated 9 hours ago
Feb 9 2012 | 1:37pm ET
A difficult 2011 has hit Och-Ziff Capital Management's bottom line in a big way.
The New York-based hedge fund said today that its fourth-quarter profit plummeted 94%. Distributable profits were just $16.8 million, down from $303.1 million for the fourth quarter of 2010. The difference, of course, was the performance of the firm's hedge funds.
With most of its funds in the red last year, Och-Ziff's performance fee income fell by 90%. "Last year was particularly volatile, characterized by the most difficult market conditions since 2008," CEO Daniel Och said.
Och-Ziff said it suffered $38 million in net redemptions in the fourth quarter, cutting assets under management to $28.8 billion. It's bounced back since, with $500 million in performance gains in January offsetting another $300 million in redemptions.
Those performance gains—all four of Och-Ziff's funds were in the black last month—put the firm's flagship back over its high-water mark, ensuring that it will be able to charge performance fees this year if its performance keeps up. The OZ Master Fund rose 1.6% on the month.
Och-Ziff's OZ Asia Master Fund rose 2.6%, its Europe Master Fund 1.9% and its OZ Special Investments Master Fund 1.3%.
Using generally accepted accounting principles—not excluding costs from the firm's 2007 initial public offering—Och-Ziff lost $137 million on the quarter. In the year-earlier period, the loss was $22.8 million.
Costs from the IPO are set to leave Och-Ziff with a GAAP loss until this year.
May 27 2015 | 2:15pm ET
Support Hedge Funds Care, also known as Help For Children (HFC), by participating in this year's raffle. All proceeds go to support HFC's mission of preventing and treating child abuse. Read more…