The 2013 Preqin Private Equity Performance Monitor features extensive analysis on private equity returns, including a comprehensive exploration of how much LPs have gained historically from the asset class. This blog looks at the net LP gain/loss by vintage year from buyout funds as of 31 December 2012; where the gain/loss is calculated by summing LP distributions and fund residual values, then subtracting called capital.
Across all vintages from 1992 to 2010, investors have received profits from their buyout fund investments. As of December 2012, vintage 2000 buyout funds have returned the highest aggregate profit for investors, bringing in $86.5bn; followed by vintages 2005 ($69.5bn), 2006 ($66.3bn) and 2007 ($61.4bn). It is worth noting that as of 31 December 2011, these buyout funds with 2005, 2006 and 2007 vintages had yielded much smaller returns of $54.9bn, $24.4bn and $20.9bn respectively, suggesting that these specific vintages have managed to recover from the effects of the financial crisis over the course of the year.
Buyout funds with a 2010 vintage have moved in to the black during the year to December 2012, returning $1.7bn to investors, while of the remaining vintage years in the range; 1992 to 1999 vintage funds have yielded less than $40bn; 2001, 2002, 2003 and 2004 vintage funds have returned $51.6bn, $39.4bn, $44.2bn and $49.6bn respectively; and 2008 and 2009 vintage funds have each yielded $43.9bn and $7.6bn for investors. It is unsurprising that investors in 2011 and 2012 vintage buyout funds are in the red by $1.4bn and $0.6bn respectively, due to the fact that these funds are still in the early stages of their investment cycles with fund managers in the process of drawing down capital.