Press Release

Fortress Reports First Quarter 2010 Financial Results

Company Release - 5/6/2010 5:00 AM ET

First Quarter 2010 Highlights

  • Pro-forma assets under management of $41.6 billion as of March 31, 2010 1
  • Raised $890 million of new third-party capital, of which $740 million is included in assets under management
  • Fund management distributable earnings of $92 million
  • Pre-tax distributable earnings (DE) of $96 million
  • GAAP net loss, excluding principals agreement compensation, of $27 million. GAAP net loss of $261 million. GAAP net loss attributable to Class A Shareholders of $84 million

Subsequent Events in the Second Quarter

  • Fortress funds agreed to purchase European mortgage assets and platforms from Residential Capital
  • Fortress closed the acquisition of Logan Circle Partners

NEW YORK--(BUSINESS WIRE)-- Fortress Investment Group LLC (NYSE: FIG) today reported its first quarter 2010 results.

First Quarter 2010

For the quarter ended March 31, 2010, our GAAP net loss was $261 million compared to a loss of $287 million for first quarter 2009. Our GAAP net loss attributable to Class A Shareholders was $84 million, or $0.58 loss per diluted share, as compared to a loss of $67 million, or $0.71 loss per diluted share, for the first quarter 2009. Excluding principals agreement compensation, first quarter GAAP net loss was $27 million, as compared to a net loss of $52 million for first quarter 2009.

For the first quarter, fund management distributable earnings was $92 million compared to $44 million in the first quarter of 2009.

Pre-tax DE for the first quarter was $96 million versus $9 million for the first quarter of 2009.

1 Amount gives pro-forma effect to the acquisition of Logan Circle Partners in April 2010. As of the acquisition date on April 16, 2010, Logan Circle Partners had approximately $11.4 billion of assets under management.

The table below details Fortress’s GAAP Net Income (Loss) and Distributable Earnings for the first quarter 2010 and 2009:

       
First Quarter $
  2010       2009   Change
(in millions, except per share amount)
GAAP
Net income (loss) $ (261 ) $ (287 ) $ 26
 
Net income (loss) attributable to Class A Shareholders $ (84 ) $ (67 ) $ (17 )
Per diluted share $ (0.58 ) $ (0.71 ) $ 0.13
 
Net income (loss) excluding principals agreement compensation $ (27 ) $ (52 ) $ 25
 
Distributable Earnings
Fund management DE $ 92 $ 44 $ 48
 
Pre-tax DE $ 96 $ 9 $ 87
Per dividend paying share/unit $ 0.19 $ 0.02 $ 0.17
 
Weighted Average Dividend Paying Shares and Units Outstanding 516 461
 

For reconciliations of non-GAAP measures, please see Exhibit 2, “Reconciliation of Fund Management DE to Pre-tax DE and GAAP Net Income (Loss) and Reconciliation of Segment Revenues to GAAP Revenues,” Exhibit 3, “Reconciliation of GAAP Net Income (Loss) Excluding Principals Agreement Compensation to GAAP Net Income (Loss)” and Exhibit 4, “Reconciliation of Weighted Average Class A Shares Outstanding (Used for Basic EPS) to Weighted Average Dividend Paying Shares and Units Outstanding (Used for DEPS)” at the end of this release. Distributable earnings is a supplemental measure of our operating performance that we believe provides a meaningful basis for comparison between present and future periods.

The Company’s quarterly segment revenues and distributable earnings will fluctuate materially depending upon the performance of our funds and the realization events within our private equity businesses, as well as other factors. Accordingly, the revenues and profits in any particular quarter should not be expected to be indicative of future results.

The following discussion of our results is based on segment reporting as presented in our Quarterly Report on Form 10-Q. Our GAAP statement of operations and balance sheet are presented following this discussion. The following table is a summary presentation of our segment performance with supplemental data provided for informational purposes.

Supplemental Data for First Quarter 2010 and 2009:

             
Three Months Ended March 31, 2010
  Private Equity

Liquid Hedge

Credit Funds

Principal
(in millions) Total Funds   Castles

Funds

Hedge Funds PE Funds Investments
 
Assets Under Management
AUM - January 1, 2010 $ 31,476 $ 11,344 $ 3,232 $ 4,297 $ 9,256 $ 3,347 $ -
Capital raised 740 - 2 634 81 23 -
Capital acquisitions - - - - - - -
Increase in invested capital 202 2 - 1 1 198 -
Redemptions (271 ) - - (217 ) (54 ) - -
SPV/RCA distributions (861 ) - - (510 ) (351 ) - -
Return of capital distributions (1,364 ) (5 ) - - (1 ) (1,358 ) -
Equity buyback (62 ) - (62 ) - - - -
Crystallized Incentive Income (3 ) - - (3 ) - - -
Income (loss) and foreign exchange   340     214     (117 )   71     185     (13 )   -  
AUM - Ending Balance $ 30,197 $ 11,555 $ 3,055 $ 4,273 $ 9,117 $ 2,197 $ -
 
Third-Party Capital Raised $ 890 $ - $ - $ 634 $ 81 $ 175 $ -
 
Segment Revenues
Management fees $ 108 $ 33 $ 12 $ 19 $ 34 $ 10 $ -
Incentive income   99     -     -     6     8     85     -  
Total 207 33 12 25 42 95 -
 
Segment Expenses
Operating expenses (64 ) (9 ) (8 ) (14 ) (27 ) (6 ) -
Profit sharing compensation expenses (50 ) - - (3 ) (4 ) (43 ) -
Unallocated Expenses   (1 )            
Total (115 ) (9 ) (8 ) (17 ) (31 ) (49 ) -
             
Fund Management DE   92     24     4     8     11     46     -  
 
Investment Income 8 8
Interest Expense (4 ) (4 )
             
Pre-tax DE $ 96   $ 24   $ 4   $ 8   $ 11   $ 46   $ 4  
 
             
Three Months Ended March 31, 2009
  Private Equity

Liquid Hedge

Credit Funds Principal
(in millions) Total Funds   Castles

Funds

Hedge Funds PE Funds Investments
 
Assets Under Management
AUM - January 1, 2009 $ 29,229 $ 10,307 $ 3,182 $ 7,169 $ 6,269 $ 2,302 $ -
Capital raised 9 - - 9 - - -
Increase in invested capital 436 60 - - - 376 -
Redemptions (2,494 ) - - (2,494 ) - - -
SPV/RCA distributions (152 ) - - - (152 ) - -
Return of capital distributions (577 ) (5 ) - - (7 ) (565 ) -
Equity buyback - - - - - - -
Reset Date - - - - - - -
Crystallized Incentive Income - - - - - - -
Income (loss) and foreign exchange   (149 )   (201 )   (104 )   125     105     (74 )   -  
AUM - Ending Balance $ 26,302 $ 10,161 $ 3,078 $ 4,809 $ 6,215 $ 2,039 $ -
 
Third-Party Capital Raised $ 9 $ - $ - $ 9 $ - $ - $ -
 
Segment Revenues
Management fee $ 106 $ 37 $ 12 $ 23 $ 28 $ 6 $ -
Incentive income   1     -     -     -     1     -     -  
Total 107 37 12 23 29 6 -
 
Segment Expenses
Operating expenses (59 ) (8 ) (8 ) (14 ) (25 ) (4 ) -
Profit sharing compensation expenses (4 ) - - (3 ) (1 ) - -
Unallocated Expenses   -              
Total (63 ) (8 ) (8 ) (17 ) (26 ) (4 ) -
             
Fund Management DE   44     29     4     6     3     2     -  
 
Investment Income (27 ) (27 )
Interest Expense   (8 )             (8 )
 
Pre-tax DE $ 9   $ 29   $ 4   $ 6   $ 3   $ 2   $ (35 )
 

Overview

On a pro-forma basis, we managed $41.6 billion of assets in private equity funds, liquid hedge funds, credit funds and traditional asset management funds at March 31, 2010.2 Fortress’s revenues consist of (i) management fees, which are based on the size of our funds, (ii) incentive income, which is based on the performance of our funds, and (iii) investment income (loss), which is based on our principal investments.

In the first quarter of 2010, we generated fund management distributable earnings of $92 million. Including principal investments, Fortress generated pre-tax DE of $96 million.

For the quarter ended March 31, 2010, the private equity segments accounted for approximately 22% of total segment revenues, the liquid hedge funds segment accounted for approximately 12% of total segment revenues and the credit funds segments accounted for approximately 66% of total segment revenues.

For the quarter ended March 31, 2010, the private equity, liquid hedge funds and credit funds businesses accounted for approximately 30%, 8% and 62%, respectively, of total fund management distributable earnings.

2 Amount gives pro-forma effect to the acquisition of Logan Circle Partners in April 2010. As of the acquisition date on April 16, 2010, Logan Circle Partners had approximately $11.4 billion of assets under management.

Private Equity – Funds

For the quarter ended March 31, 2010, the Company’s private equity funds had pre-tax DE of $24 million compared to pre-tax DE of $29 million for the quarter ended March 31, 2009.

Assets under management for private equity funds was $11.6 billion at March 31, 2010 compared to $10.2 billion at March 31, 2009.

Private Equity - Castles

For the quarter ended March 31, 2010, the Company’s Castles generated pre-tax DE of $4 million compared to $4 million for the quarter ended March 31, 2009.

Assets under management for the Castles was $3.1 billion at March 31, 2010 compared to $3.1 billion at March 31, 2009.

Liquid Hedge Funds

For the quarter ended March 31, 2010, the Company’s liquid hedge fund business generated pre-tax DE of $8 million compared to $6 million for the quarter ended March 31, 2009.

Assets under management for the liquid hedge funds was $4.3 billion at March 31, 2010 compared to $4.8 billion at March 31, 2009.

The following table shows our Assets Under Management by fund:

           
(dollars in billions) March 31, 2010 December 31, 2009 March 31, 2009
Macro Funds 3 $3.3 $3.4 $3.8
Fortress Commodities Funds 4 $1.0 $0.9 $1.0
 

3 Combined AUM for Fortress Macro Onshore Fund LP, Fortress Macro Offshore Fund L.P., Fortress Macro Fund Ltd, Fortress Macro managed accounts, Drawbridge Global Macro Fund L.P., Drawbridge Global Macro Intermediate Fund L.P., Drawbridge Global Macro Alpha Intermediate Fund L.P., DBGM Offshore Ltd, DBGM Onshore LP, DBGM Alpha V Ltd and Drawbridge Global Macro managed accounts.

4 Combined AUM for Fortress Commodities Fund L.P. and Fortress Commodities managed accounts.

The following table shows our gross and net returns by fund:5

       
Gross Returns

Three Months Ended
March 31, 2010

Estimated
Four Months Ended
April 30, 2010

 
Fortress Macro Offshore Fund L.P. 4.3% 3.7%
Drawbridge Global Macro Fund Ltd 4.2%

3.5%

Fortress Commodities Fund L.P. -3.0% -3.5%
 
Net Returns
 
Fortress Macro Offshore Fund L.P. 3.0% 2.4%
Drawbridge Global Macro Fund Ltd 3.7%

2.8%

Fortress Commodities Fund L.P. -3.5% -4.2%
 

5 The performance data contained herein reflects returns for a "new issue eligible," single investor class as of the close of business on the last day of the relevant period. Gross returns reflect performance data prior to management fees borne by the Fund and incentive allocations while net returns reflect performance data after taking into account management fees borne by the Fund and incentive allocations.

Credit - Hedge Funds

For the quarter ended March 31, 2010, the Company’s credit hedge fund business generated pre-tax DE of $11 million compared to $3 million for the quarter ended March 31, 2009.

Assets under management for the credit hedge funds was $9.1 billion at March 31, 2010 compared to $6.2 billion at March 31, 2009.

The following table shows our Assets Under Management by fund:

         
(dollars in billions) March 31, 2010 December 31, 2009 March 31, 2009
Drawbridge Special Opportunities Funds 6 $5.2 $5.2 $4.9
Fortress Partners Funds 7 $1.6 $1.6 $1.3
Fortress Value Recovery Funds 8 $2.3 $2.5 N.A.
 

6 Combined AUM for Drawbridge Special Opportunities Fund Ltd, Drawbridge Special Opportunities Fund LP, Drawbridge Special Opportunities Fund managed accounts and Worden Fund LP.

7 Combined AUM for Fortress Partners Offshore Fund LP and Fortress Partners Fund LP.

8 Fortress will receive management fees from these funds equal to 1% of cash receipts and up to 1% per annum on certain managed assets, subject to collectability, and may receive limited incentive income if aggregate realizations exceed an agreed threshold.

The following table shows our gross and net returns by fund:9

     
Gross Returns

Three Months Ended
March 31, 2010

 
Drawbridge Special Opportunities LP 10 7.4%
Drawbridge Special Opportunities Ltd 10 7.6%
Fortress Partners Fund LP 3.3%
Fortress Partners Offshore Fund LP 2.9%
 
Net Returns
 
Drawbridge Special Opportunities LP 10 6.9%
Drawbridge Special Opportunities Ltd 10 7.0%
Fortress Partners Fund LP 3.0%
Fortress Partners Offshore Fund LP 2.6%
 

9 The performance data contained herein reflects returns for a "new issue eligible," single investor class as of the close of business on the last day of the relevant period. Gross returns reflect performance data prior to management fees borne by the Fund and incentive allocations while net returns reflect performance data after taking into account management fees borne by the Fund and incentive allocations. Specific performance may vary based on, among other things, whether fund investors are invested in one or more special investments.

10 The returns for the Drawbridge Special Opportunities Funds reflect the performance of each fund excluding the performance of the redeeming capital accounts which relate to December 31, 2008 and December 31, 2009 redemptions.

Credit - Private Equity Funds

For the quarter ended March 31, 2010, the Company’s credit private equity fund business generated pre-tax DE of $46 million as compared to $2 million for the quarter ended March 31, 2009.

Assets under management for the credit private equity funds was $2.2 billion at March 31, 2010 compared to $2.0 billion at March 31, 2009. As of March 31, 2010, the credit private equity funds had approximately $2.9 billion of uncalled or recallable committed capital that will become assets under management when invested.

Principal Investments

At March 31, 2010, we had $0.7 billion of assets (excluding cash and cash equivalents) in our principal investments segment, compared to $0.8 billion (excluding cash and cash equivalents) at March 31, 2009. During the first quarter of 2010, we increased commitments to our principal investments by $1 million and funded $32 million of our commitments. We had $115 million of unfunded commitments to our principal investments as of March 31, 2010.

Our principal investments segment generated a net gain of $4 million for the three months ended March 31, 2010, due primarily to gains of $8 million from our balance sheet investments offset by $4 million of interest expense.

Segment Expenses

Segment expenses were $115 million in the first quarter of 2010, up from $63 million for the first quarter of 2009. Segment expenses for the first quarter of 2010 included $50 million of profit sharing compensation, which is a function of revenues received from our various funds.

The Company had $299 million of share-based compensation expense (primarily relating to expense recorded in connection with the principals agreement, the issuance of restricted stock units to Fortress employees, and the issuance of restricted partnership units) for the quarter ended March 31, 2010, which contributed to our reporting a GAAP net loss. Share-based compensation expense is not included in segment expenses or in the calculation of distributable earnings.

Corporate Credit Agreement

During the first quarter, we paid down the credit facility by $28 million. As of March 31, 2010, we have $370 million of debt outstanding and have capacity available of approximately $60 million under our revolving credit facility.

Non-GAAP Information

Fortress discloses certain non-GAAP financial information, which management believes provides a meaningful basis for comparison among present and future periods. The following are non-GAAP measures used in the accompanying financial information:

  • Pre-tax DE and pre-tax DE per dividend paying share
  • Fund management distributable earnings
  • Segment revenues
  • GAAP net income excluding principals agreement compensation
  • Weighted Average Dividend Paying Shares and Units Outstanding (Used for DEPS)

We urge you to read the reconciliation of such data to the related GAAP measures appearing in the exhibits to this release.

Conference Call

Management will host a conference call today, Thursday, May 6, 2010 at 10:00 A.M. Eastern Time. A copy of the earnings release is posted to the Investor Relations section of Fortress’s website, www.fortress.com.

All interested parties are welcome to participate on the live call. The conference call may be accessed by dialing 1-877-252-8576 (from within the U.S.) or 1-706-679-1521 (from outside of the U.S.) ten minutes prior to the scheduled start of the call; please reference “Fortress First Quarter Earnings Call.”

A simultaneous webcast of the conference call will be available to the public on a listen-only basis at www.fortress.com. Please allow extra time prior to the call to visit the site and download the necessary software required to listen to the internet broadcast.

A telephonic replay of the conference call will also be available until 11:59 P.M. Eastern Time on Thursday, May 13, 2010 by dialing 1-800-642-1687 (from within the U.S.) or 1-706-645-9291 (from outside of the U.S.); please reference access code “71653027.”

About Fortress

Fortress is a leading global investment manager with approximately $41.6 billion in pro-forma assets under management as of March 31, 2010. Fortress offers alternative and traditional investment products and was founded in 1998. For more information regarding Fortress Investment Group LLC or to be added to our e-mail distribution list, please visit www.fortress.com.

Cautionary Note Regarding Forward-Looking Statements — Certain statements in this press release may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding our sources of management fees, incentive income and investment income (loss), estimated fund performance, the amount and source of expected capital commitments and amount of redemptions. These statements are not historical facts, but instead represent only the Company’s beliefs regarding future events, many of which, by their nature, are inherently uncertain and outside of the Company’s control. It is possible that the sources and amounts of management fees, incentive income and investment income, the amount and source of expected capital commitments for any new fund or redemption amounts may differ, possibly materially, from these forward-looking statements, and any such differences could cause our actual results to differ materially from the results expressed or implied by these forward-looking statements. For a discussion of some of the risks and important factors that could affect such forward-looking statements, see the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s Quarterly Report on Form 10-Q, which is, or will be, available on the Company’s website (www.fortress.com). In addition, new risks and uncertainties emerge from time to time, and it is not possible for the Company to predict or assess the impact of every factor that may cause its actual results to differ from those contained in any forward-looking statements. Accordingly, you should not place undue reliance on any forward-looking statements contained in this press release. The Company can give no assurance that the expectations of any forward-looking statement will be obtained. Such forward-looking statements speak only as of the date of this press release. The Company expressly disclaims any obligation to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company’s expectations with regard thereto or any change in events, conditions or circumstances on which any statement is based.

 

Fortress Investment Group LLC
Consolidated Statements of Operations (Unaudited)
(dollars in thousands, except share data)

     
Three Months Ended March 31,
  2010       2009  
Revenues
Management fees from affiliates $ 106,536 $ 105,652
Incentive income from affiliates 17,556 -
Expense reimbursements from affiliates 23,067 13,047
Other revenues   13,029     3,597  
  160,188     122,296  
Expenses
Interest expense 3,796 8,186
Compensation and benefits 179,393 109,236
Principals agreement compensation 234,759 234,759
General, administrative and other 21,108 17,185
Depreciation and amortization   2,682     2,641  
  441,738     372,007  
Other Income (Loss)
Gains (losses) from investments 572 (2,473 )
Tax receivable agreement liability adjustment 1,317 (55 )
Earnings (losses) from equity method investees   19,881     (34,849 )
  21,770     (37,377 )
Income (Loss) Before Income Taxes (259,780 ) (287,088 )
Income tax benefit (expense)   (1,552 )   407  
Net Income (Loss) $ (261,332 ) $ (286,681 )
 

Principals' and Others' Interests in Income (Loss) of
Consolidated Subsidiaries

$ (177,181 ) $ (219,522 )
 
Net Income (Loss) Attributable to Class A Shareholders $ (84,151 ) $ (67,159 )
 
Dividends declared per Class A share $ -   $ -  
 

Earnings Per Class A share - Fortress Investment Group

 
Net income (loss) per Class A share, basic $

(0.56

) $ (0.71 )
Net income (loss) per Class A share, diluted $

(0.58

) $ (0.71 )
Weighted average number of Class A shares outstanding, basic   157,821,895     95,202,243  
Weighted average number of Class A shares outstanding, diluted   465,595,747     95,202,243  
 
 

Fortress Investment Group LLC
Consolidated Balance Sheets
(dollars in thousands, except share data)

       
March 31, December 31,
2010 2009
(Unaudited)  
Assets
Cash and cash equivalents $ 223,421 $ 197,099
Due from affiliates 101,130 64,511
Investments 878,467 867,215
Deferred tax asset 443,359 440,639
Other assets   89,150     90,803  
 
$ 1,735,527   $ 1,660,267  
 
Liabilities and Equity
 
Liabilities
Accrued compensation and benefits $ 64,828 $ 131,134
Due to affiliates 362,568 345,976
Deferred incentive income 227,303 160,097
Debt obligations payable 369,876 397,825
Other liabilities   58,054     25,921  
 
  1,082,629     1,060,953  
 
Commitments and Contingencies
 
Equity
Class A shares, no par value, 1,000,000,000 shares authorized, 151,070,002
and 145,701,622 shares issued and outstanding at March 31, 2010
and December 31, 2009, respectively - -
Class B shares, no par value, 750,000,000 shares authorized, 307,773,852
shares issued and outstanding at March 31, 2010 - -
Paid-in capital 1,130,850 1,029,536
Retained earnings (accumulated deficit) (852,145 ) (767,994 )
Accumulated other comprehensive income (loss)   (635 )   (325 )
Total Fortress shareholders' equity 278,070 261,217
Principals' and others' interests in equity of consolidated subsidiaries   374,828     338,097  
 
Total equity   652,898     599,314  
$ 1,735,527   $ 1,660,267  
 
             

Fortress Investment Group LLC
Exhibit 1
Assets Under Management and Fund Management DE
(dollars in millions)

 
  Three Months Ended

Three Months
Ended

March 31,
2009

 

June 30,
2009

September 30,
2009

December 31,
2009

Full Year
2009

March 31,
2010

 
Fortress
 
Assets Under Management
Private Equity & Castles $ 13,239 $ 13,795 $ 14,336 $ 14,576 $ 14,576 $ 14,610
Liquid Hedge Funds 4,809 4,571 4,483 4,297 4,297 4,273
Credit Hedge Funds 6,215 9,673 9,560 9,256 9,256 9,117
Credit Private Equity Funds   2,039     2,757     3,351     3,347     3,347     2,197  
AUM - Ending Balance $ 26,302 $ 30,796 $ 31,730 $ 31,476 $ 31,476 $ 30,197
 
Third-Party Capital Raised $ 9 $ 233 $ 460 $ 677 $ 1,379 $ 890
 
Segment Revenues
Management fees $ 106 $ 110 $ 108 $ 100 $ 424 $ 108
Incentive income   1     7     10     57     75     99  
Total 107 117 118 157 499 207
 
Segment Expenses
Operating expenses (59 ) (56 ) (58 ) (70 ) (243 ) (64 )
Profit sharing compensation expenses (4 ) (8 ) (9 ) (26 ) (47 ) (50 )
Unallocated Expenses   -     -     -     (1 )   (1 )   (1 )
Total (63 ) (64 ) (67 ) (97 ) (291 ) (115 )
           
Fund Management DE $ 44   $ 53   $ 51   $ 60   $ 208   $ 92  
 
 

Fortress Investment Group LLC

Exhibit 1

Assets Under Management and Fund Management DE

(dollars in millions)

 
      Three Months Ended    

Three Months
Ended

March 31,
2009

 

June 30,
2009

 

September 30,
2009

 

December 31,
2009

Full Year
2009

March 31,
2010

 
Private Equity Funds & Castles
 
Assets Under Management
Private Equity Funds $ 10,161 $ 10,602 $ 11,057 $ 11,344 $ 11,344 $ 11,555
Castles   3,078     3,193     3,279     3,232     3,232     3,055  
AUM - Ending Balance $ 13,239 $ 13,795 $ 14,336 $ 14,576 $ 14,576 $ 14,610
 
Third-Party Capital Raised $ - $ - $ - $ - $ - $ -
 
Segment Revenues
Management fees $ 49 $ 52 $ 45 $ 35 $ 181 $ 45
Incentive income   -     -     -     36     36     -  
Total 49 52 45 71 217 45
 
Segment Expenses
Operating expenses (16 ) (17 ) (15 ) (19 ) (67 ) (17 )
Profit sharing compensation expenses   -     -     -     (13 )   (13 )   -  
Total (16 ) (17 ) (15 ) (32 ) (80 ) (17 )
           
Fund Management DE $ 33   $ 35   $ 30   $ 39   $ 137   $ 28  
 
             

Fortress Investment Group LLC
Exhibit 1
Assets Under Management and Fund Management DE
(dollars in millions)

 
Three Months Ended

Three Months
Ended

March 31,
2009

 

June 30,
2009

September 30,
2009

December 31,
2009

Full Year
2009

March 31,
2010

 
Liquid Hedge Funds
 
Assets Under Management
Fortress Macro Funds 11 $ - $ 1,174 $ 1,544 $ 1,986 $ 1,986 $ 2,482
Drawbridge Global Macro Funds 12 3,781 2,484 2,074 1,429 1,429 771
Fortress Commodities Funds 13   1,028     913     865     882     882     1,020  
AUM - Ending Balance $ 4,809 $ 4,571 $ 4,483 $ 4,297 $ 4,297 $ 4,273
 
Third-Party Capital Raised $ 9 $ 99 $ 187 $ 409 $ 704 $ 634
 
Segment Revenues
Management fees $ 23 $ 20 $ 18 $ 19 $ 80 $ 19
Incentive income   -     -     9     5     14     6  
Total 23 20 27 24 94 25
 
Segment Expenses
Operating expenses (14 ) (11 ) (14 ) (18 ) (57 ) (14 )
Profit sharing compensation expenses   (3 )   (2 )   (7 )   (4 )   (16 )   (3 )
Total (17 ) (13 ) (21 ) (22 ) (73 ) (17 )
           
Fund Management DE $ 6   $ 7   $ 6   $ 2   $ 21   $ 8  
 
 
Returns

Gross Returns 14

Fortress Macro Offshore Fund L.P. N/A 4.3 % 4.9 % 3.9 % 13.7 % 4.3 %
Drawbridge Global Macro Fund Ltd 5.7 % 6.2 % 7.9 % 4.4 % 26.5 % 4.2 %
Fortress Commodities Fund L.P. 0.0 % 2.3 % 5.2 % 3.2 % 11.0 % -3.0 %
 

Net Returns 14

Fortress Macro Offshore Fund L.P. N/A 3.2 % 3.6 % 2.7 % 9.8 % 3.0 %
Drawbridge Global Macro Fund Ltd 5.2 % 5.8 % 7.4 % 3.9 % 24.2 % 3.7 %
Fortress Commodities Fund L.P. -0.5 % 1.8 % 3.9 % 2.0 % 7.3