NEW YORK (AP) — Private equity firm Blackstone said Thursday that its fourth-quarter profit surged as the market for initial public offerings improved.
Net income shot up to $621.3 million from $106.4 million in the same period a year ago.
An adjusted profit measure favored by the private equity industry — economic net income, strips out charges tied to employee stock grants from Blackstone's 2007 initial public offering of stock — more than doubled to $1.54 billion from $670 million. Earnings per share rose to $1.35 from 59 cents.
Wall Street analysts had forecast profit of 86 cents per share, according to data provider FactSet.
Blackstone Group LP's stock gained $1.99, or 6.4 percent, to $32.92 in premarket trading.
Blackstone's private equity business raises money from large investors such as pension funds and uses that money and debt financing to buy companies, often distressed public companies. It aims to profit by selling them later to investors in an IPO, or to other companies.
The firm's fourth-quarter earnings got a boost from four IPOs, including the $2.35 billion debut of hotel chain Hilton Worldwide Holdings Inc. in December. Demand for new stock offerings recovered last year as the stock market surged.