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KKR & Co. L.P. Reports Third Quarter 2017 Results

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NEW YORK, October 26, 2017 - KKR & Co. L.P. (NYSE: KKR) today reported its third quarter 2017 results.

GAAP net income (loss) attributable to KKR & Co. L.P. common unitholders was $153.6 million and $818.6 million for the quarter and nine months ended September 30, 2017, respectively. On a diluted basis, net income (loss) per common unit was $0.30 and $1.63 for the quarter and nine months ended September 30, 2017, respectively. GAAP KKR & Co. L.P. Capital - Common Unitholders equity was $6.4 billion ⁽¹⁾ as of September 30, 2017, or $13.49, per outstanding common unit.

After-tax Economic Net Income (Loss) and After-tax Economic Net Income (Loss) per adjusted unit were $308.4 million and $0.36, respectively, for the quarter ended September 30, 2017. After-tax Distributable Earnings and After-tax Distributable Earnings per adjusted unit eligible for distribution were $464.5 million and $0.57, respectively, for the quarter ended September 30, 2017.

After-tax Economic Net Income (Loss) and After-tax Economic Net Income (Loss) per adjusted unit were $1,610.8 million and $1.90, respectively, for the nine months ended September 30, 2017. After-tax Distributable Earnings and After-tax Distributable Earnings per adjusted unit eligible for distribution were $1,132.8 million and $1.39, respectively, for the nine months ended September 30, 2017.

Highlights

•	Monetization activity in Private Markets drove After-tax Distributable Earnings of $464.5 million, or $0.57 per adjusted unit eligible for distribution, for the third quarter of 2017

•	Book value was $11.2 billion as of September 30, 2017 or $13.80 per outstanding adjusted unit

•	As of September 30, 2017, Assets Under Management (“AUM”) and Fee Paying Assets Under Management (“FPAUM”) were $153 billion and $114 billion, respectively, up 17% and 22%, respectively, compared to September 30, 2016. New fee paying capital raised exceeded $37 billion over the past 12 months on an organic basis

•	In the quarter, KKR closed on two strategic investor partnerships, which includes total commitments of $7 billion, a portion of which was included in our AUM and FPAUM as of June 30, 2017. Both strategic investor partnerships include recycling provisions and have expected lives greater than 20 years

•	KKR's regular distribution per common unit of $0.17 was declared for the quarter ended September 30, 2017

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“Continued strong operating fundamentals across the firm were evidenced by double-digit growth year-to-date across our Management Fees, Fee Related Earnings, Economic Net Income and Book Value,” said Henry R. Kravis and George R. Roberts, Co-Chairmen and Co-Chief Executive Officers of KKR.  “Additionally, with the closing of two new strategic investor partnerships in the quarter and continued fundraising momentum, our Assets Under Management and Fee Paying Assets Under Management have increased 17% and 22%, respectively, year-over-year.” 

Note: Certain financial measures, including economic net income ("ENI"), After-tax ENI, After-tax distributable earnings, book value, adjusted units and outstanding adjusted units, are not presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”). See Exhibits C and D for a reconciliation of such measures to financial results prepared in accordance with GAAP.

⁽¹⁾ GAAP KKR & Co. L.P. Capital - Common Unitholders equity represents only that portion of the business held by KKR & Co. L.P. and does not include the economic interests that are held by KKR Holdings L.P. Our reportable segments are presented prior to giving effect to the allocation of ownership interests between KKR & Co. L.P. and KKR Holdings L.P. and as such represent the business in total.

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GAAP RESULTS COMMENTARY

Fees and Other

Fees and Other were $692.9 million for the quarter ended September 30, 2017 compared to $687.1 million for the quarter ended September 30, 2016. The increase was primarily due to higher transaction fees primarily in our Capital Markets and Private Markets segments and an increase in management fees in our Private Markets segment, partially offset by decreases in carried interest gains primarily reflecting a lower level of appreciation in the value of our private equity portfolio as compared to the comparable prior period.

Fees and Other were $2,340.6 million for the nine months ended September 30, 2017 compared to $1,426.6 million for the nine months ended September 30, 2016. The increase was primarily due to higher levels of carried interest gains in the current period as well as higher level of transaction fees primarily in our Capital Markets and Private Markets segments.

Expenses

Total expenses were $530.2 million for the quarter ended September 30, 2017 compared to $511.1 million for the quarter ended September 30, 2016. The increase was primarily due to increased cash compensation and benefits in connection with a higher level of fees, partially offset by a lower level of performance income compensation reflecting a lower level of appreciation in the value of our private equity portfolio as compared to the comparable prior period.

Total expenses were $1,700.0 million for the nine months ended September 30, 2017 compared to $1,242.7 million for the nine months ended September 30, 2016. The increase was primarily due to a higher level of performance income compensation reflecting a higher level of appreciation in the value of our private equity and credit portfolios in the 2017 period as well as increased cash compensation and benefits.

Total Investment Income (Loss)

Total investment income (loss) was $234.7 million for the quarter ended September 30, 2017 compared to $809.6 million for the quarter ended September 30, 2016. The decrease was primarily due to a lower level of net gains in our private equity portfolio as compared to the prior period as well as net losses in certain consolidated credit funds in the current period.

Total investment income (loss) was $1,482.2 million for the nine months ended September 30, 2017 compared to $322.5 million for the nine months ended September 30, 2016. The increase was primarily due to an increase in the value of KKR's private equity and credit portfolios.

Net Income (Loss) Attributable to KKR & Co. L.P. Common Unitholders

Net Income (Loss) Attributable to KKR & Co. L.P. Common Unitholders was $153.6 million for the quarter ended September 30, 2017 compared to $352.2 million for the quarter ended September 30, 2016. The decrease was primarily due to the lower level of investment income and carried interest gains as described above.

Net Income (Loss) Attributable to KKR & Co. L.P. Common Unitholders was $818.6 million for the nine months ended September 30, 2017 compared to $116.1 million for the nine months ended September 30, 2016. The increase was primarily due to the drivers of investment income and carried interest gains, partially offset by higher expenses, as described above.

TOTAL REPORTABLE SEGMENTS RESULTS COMMENTARY

Segment Revenues

Total segment revenues for the quarter ended September 30, 2017 were $769.7 million, compared to total segment revenues of $1,031.5 million in the comparable period of 2016. The decrease was primarily attributable to lower net investment income and a lower level of carried interest gains. These decreases were partially offset by (i) an increase in transaction fees in our Capital Markets and Private Markets segments and (ii) an increase in management fees in our Private Markets segment. The lower level of investment income and carried interest gains was primarily due to a lower level of net appreciation in KKR's private equity portfolio in the third quarter of 2017. The increase in transaction fees was driven largely by an increase in both the number and size of capital markets transactions in the current quarter. The increase in management fees was primarily attributable to the closing of two flagship private equity funds in 2017, resulting in higher management fees compared to the 2016 period. For the quarter ended September 30, 2017, KKR's private equity portfolio appreciated 3.9%.

Total segment revenues for the nine months ended September 30, 2017 were $3,057.5 million, compared to total segment revenues of $1,200.9 million in the comparable period of 2016. The increase was primarily driven by increases in investment income, performance income and fees. The increase in investment income and performance income was driven largely by higher appreciation in KKR's private equity and certain of our alternative credit portfolios. The increase in fees was driven primarily by an increase in transaction fees in our Capital Markets and Private Markets segments and an increase in management fees in our Private Markets and Public Markets segments. For the nine months ended September 30, 2017, KKR's private equity portfolio appreciated 15.9%.

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Economic Net Income

ENI was $395.0 million for the quarter ended September 30, 2017 compared to ENI of $669.3 million for the quarter ended September 30, 2016. The decrease was primarily attributable to lower total segment revenues as described above.

ENI was $1,893.8 million for the nine months ended September 30, 2017 compared to ENI of $411.2 million for the nine months ended September 30, 2016. The increase was primarily attributable to higher total segment revenues as described above.

AUM and FPAUM

AUM was $153.3 billion as of September 30, 2017, an increase of $4.8 billion, compared to AUM of $148.5 billion as of June 30, 2017. The increase was primarily driven by new capital raised and an increase in value in our private equity and credit strategies. These increases were partially offset by distributions to limited partners of our private equity funds arising from realizations and distributions made in our Public Markets segment.

FPAUM was $113.7 billion as of September 30, 2017, an increase of $1.1 billion, compared to FPAUM of $112.6 billion as of June 30, 2017. The increase was primarily attributable to new capital raised in our Public Markets and Private Markets segments. These increases were partially offset by distributions in our Public Markets segment and distributions to limited partners of our private equity funds arising from realizations.

DISTRIBUTIONS AND OTHER

A distribution of $0.17 per common unit has been declared, which will be paid on November 21, 2017 to holders of record of common units as of the close of business on November 6, 2017. Under KKR's current distribution policy, KKR intends to make equal quarterly distributions of $0.17 per unit to holders of its common units.

A distribution of $0.421875 per Series A Preferred Unit has been declared and set aside for payment on December 15, 2017 to holders of record of Series A Preferred Units as of the close of business on December 1, 2017. A distribution of $0.406250 per Series B Preferred Unit has been declared and set aside for payment on December 15, 2017 to holders of record of Series B Preferred Units as of the close of business on December 1, 2017.

The declaration and payment of any future distributions on preferred or common units are subject to the discretion of the board of directors of the general partner of KKR & Co. L.P. and the terms of its limited partnership agreement. There can be no assurance that future distributions will be made as intended or at all, that unitholders will receive sufficient distributions to satisfy payment of their tax liabilities as limited partners of KKR or that any particular distribution policy for common units will be maintained.

Since October 27, 2015, KKR has authorized a total of $750 million to repurchase its common units, of which $459 million has been spent to repurchase 31.7 million common units as of October 23, 2017. On October 3, 2017, KKR canceled equity awards representing 1.0 million common units to satisfy tax obligations of $20 million in connection with their vesting, bringing cumulative cancellations of equity awards representing 8.2 million common units to satisfy tax obligations of $137 million. In total, 39.9 million common units have been retired on a fully-diluted basis since October 27, 2015. Common units may be repurchased from time to time in open market transactions, in privately negotiated transactions or otherwise.

CONFERENCE CALL

A conference call to discuss KKR's financial results will be held on Thursday, October 26, 2017 at 10:00 a.m. ET. The conference call may be accessed by dialing (877) 303-2917 (U.S. callers) or +1 (253) 237-1135 (non-U.S. callers); a pass code is not required. Additionally, the conference call will be broadcast live over the Internet and may be accessed through the Investor Center section of KKR's website at http://ir.kkr.com/kkr_ir/kkr_events.cfm. A replay of the live broadcast will be available on KKR's website or by dialing (855) 859-2056 (U.S. callers) or +1 (404) 537-3406 (non-U.S. callers), pass code 89038931, beginning approximately two hours after the broadcast.

A slide presentation containing supplemental commentary about KKR's financial results for the fiscal quarter ended September 30, 2017 may be accessed through the Investor Center of the KKR website at http://ir.kkr.com/kkr_ir/kkr_events.cfm. The presentation will be referenced on the conference call discussed above.

From time to time, KKR may use its website as a channel of distribution of material company information. Financial and other important information regarding KKR is routinely posted and accessible on the Investor Center for KKR & Co. L.P. at http://ir.kkr.com/kkr_ir/kkr_events.cfm. In addition, you may automatically receive email alerts and other information about KKR by enrolling your email address at the “Email Alerts” area of the Investor Center on the website.

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ABOUT KKR

KKR is a leading global investment firm that manages multiple alternative asset classes, including private equity, energy, infrastructure, real estate, credit and, through its strategic partners, hedge funds. KKR aims to generate attractive investment returns by following a patient and disciplined investment approach, employing world-class people, and driving growth and value creation with KKR portfolio companies. KKR invests its own capital alongside its partners' capital and provides financing solutions and investment opportunities through its capital markets business. References to KKR’s investments may include the activities of its sponsored funds. For additional information about KKR & Co. L.P. (NYSE: KKR), please visit KKR's website at www.kkr.com and on Twitter @KKR_Co.

FORWARD-LOOKING STATEMENTS

This release contains certain forward-looking statements. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts, including the statements with respect to the declaration and payment of distributions in future quarters and the timing, manner and volume of repurchase of common units pursuant to its repurchase program. The forward-looking statements are based on KKR’s beliefs, assumptions and expectations, taking into account all information currently available to it. These beliefs, assumptions and expectations can change as a result of many possible events or factors, not all of which are known to KKR or are within its control. If a change occurs, KKR’s business, financial condition, liquidity and results of operations, including but not limited to AUM, FPAUM, ENI, after-tax ENI, after-tax distributable earnings, capital invested, syndicated capital, uncalled commitments, cash and short-term investments, fee related earnings, fee and yield segment EBITDA, core interest expense and book value, may vary materially from those expressed in the forward-looking statements. The following factors, among others, could cause actual results to vary from the forward-looking statements: the volatility of the capital markets; failure to realize the benefits of or changes in KKR’s business strategies including the ability to realize the anticipated synergies from acquisitions, strategic partnerships or other transactions; availability, terms and deployment of capital; availability of qualified personnel and expense of recruiting and retaining such personnel; changes in the asset management industry, interest rates or the general economy; underperformance of KKR's investments and decreased ability to raise funds; and the degree and nature of KKR’s competition. All forward looking statements speak only as of the date hereof. KKR does not undertake any obligation to update any forward-looking statements to reflect circumstances or events that occur after the date on which such statements were made except as required by law. In addition, KKR’s business strategy is focused on the long term and financial results are subject to significant volatility. Additional information about factors affecting KKR is available in KKR & Co. L.P.’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016, filed with the SEC on February 24, 2017, quarterly reports on Form 10-Q for subsequent quarters and other filings with the SEC, which are available at www.sec.gov.

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CONTACT INFORMATION

Investor Relations:                        

Kohlberg Kravis Roberts & Co. L.P.                 

Craig Larson                        

Tel: +1-877-610-4910 (U.S.) / +1-212-230-9410            

investor-relations@kkr.com                     

Media:

Kohlberg Kravis Roberts & Co. L.P.

Kristi Huller

Tel: +1-212-750-8300

media@kkr.com

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KKR
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (GAAP BASIS - UNAUDITED)
(Amounts in thousands, except common unit and per common unit amounts)
		Quarter Ended								Nine Months Ended
		September 30, 2017				September 30, 2016				September 30, 2017				September 30, 2016
Revenues
Fees and Other		$	692,877			$	687,056			$	2,340,617			$	1,426,618
Expenses
Compensation and Benefits		368,513				358,161				1,234,317				780,062
Occupancy and Related Charges		15,267				16,405				44,150				49,159
General, Administrative and Other		146,467				136,551				421,522				413,437
Total Expenses		530,247				511,117				1,699,989				1,242,658
Investment Income (Loss)
Net Gains (Losses) from Investment Activities		108,779				735,144				1,085,655				9,089
Dividend Income		20,774				73,105				100,144				167,987
Interest Income		317,134				256,505				893,832				753,194
Interest Expense		(211,959		)		(255,105		)		(597,403		)		(607,812		)
Total Investment Income (Loss)		234,728				809,649				1,482,228				322,458
Income (Loss) Before Taxes		397,358				985,588				2,122,856				506,418
Income Tax (Benefit)		18,420				10,826				77,500				18,761
Net Income (Loss)		378,938				974,762				2,045,356				487,657
Net Income (Loss) Attributable to
Redeemable Noncontrolling Interests		20,876				3,121				64,196				4,616
Net Income (Loss) Attributable to
Noncontrolling Interests		196,158				611,288				1,137,585				353,044
Net Income (Loss) Attributable to KKR & Co. L.P.		161,904				360,353				843,575				129,997
Net Income (Loss) Attributable to Series A Preferred Unitholders		5,822				5,822				17,466				11,515
Net Income (Loss) Attributable to Series B Preferred Unitholders		2,519				2,379				7,557				2,379
Net Income (Loss) Attributable to KKR & Co. L.P. Common Unitholders		$	153,563			$	352,152			$	818,552			$	116,103
Net Income (Loss) Attributable to KKR & Co. L.P. Per Common Unit
Basic		$	0.33			$	0.79			$	1.76			$	0.26
Diluted (1)		$	0.30			$	0.73			$	1.63			$	0.24
Weighted Average Common Units Outstanding
Basic		471,758,886				445,989,300				463,941,084				448,149,747
Diluted (1)		506,873,177				479,975,675				501,615,635				483,134,985

⁽¹⁾ KKR Holdings L.P. units have been excluded from the calculation of diluted earnings per common unit since the exchange of these units would not dilute KKR’s respective ownership interests in the KKR Group Partnerships.

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KKR
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (GAAP BASIS - UNAUDITED)
(Amounts in thousands, except per common unit amounts)
		As of
		September 30, 2017				December 31, 2016
Assets
Cash and Cash Equivalents		$	2,436,566			$	2,508,902
Investments		37,251,837				31,409,765
Other Assets		4,617,236				5,084,230
Total Assets		44,305,639				39,002,897
Liabilities and Equity
Debt Obligations		20,290,714				18,544,075
Other Liabilities		4,149,491				3,340,739
Total Liabilities		24,440,205				21,884,814
Redeemable Noncontrolling Interests		570,134				632,348
Equity
Series A Preferred Units		332,988				332,988
Series B Preferred Units		149,566				149,566
KKR & Co. L.P. Capital - Common Unitholders		6,380,654				5,457,279
Noncontrolling Interests		12,432,092				10,545,902
Total Equity		19,295,300				16,485,735
Total Liabilities and Equity		$	44,305,639			$	39,002,897
KKR & Co. L.P. Capital Per Outstanding Common Unit - Basic		$	13.49			$	12.06

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KKR
STATEMENTS OF OPERATIONS AND OTHER SELECTED FINANCIAL INFORMATION
TOTAL REPORTABLE SEGMENTS (UNAUDITED)
(Amounts in thousands, except unit and per unit amounts)
		Quarter Ended												Nine Months Ended
		September 30, 2017				June 30, 2017				September 30, 2016				September 30, 2017				September 30, 2016
Segment Revenues
Management, Monitoring and Transaction Fees, Net
Management Fees		$	232,954			$	229,569			$	201,508			$	670,807			$	599,725
Monitoring Fees		14,342				30,510				11,091				58,072				52,126
Transaction Fees		179,167				156,465				111,354				578,667				276,003
Fee Credits		(70,747		)		(51,384		)		(47,392		)		(211,148		)		(109,272		)
Total Management, Monitoring and Transaction Fees, Net		355,716				365,160				276,561				1,096,398				818,582
Performance Income (Loss)
Realized Incentive Fees		4,074				2,624				3,659				8,384				9,897
Realized Carried Interest		419,438				264,668				350,469				890,310				753,032
Unrealized Carried Interest		(59,638		)		296,719				70,351				377,707				(134,756		)
Total Performance Income (Loss)		363,874				564,011				424,479				1,276,401				628,173
Investment Income (Loss)
Net Realized Gains (Losses)		76,053				7,180				170,078				162,684				370,594
Net Unrealized Gains (Losses)		(50,902		)		307,977				136,740				461,111				(725,699		)
Total Realized and Unrealized		25,151				315,157				306,818				623,795				(355,105		)
Interest Income and Dividends		70,557				67,836				71,185				195,275				253,756
Interest Expense		(45,613		)		(47,026		)		(47,506		)		(134,348		)		(144,497		)
Net Interest and Dividends		24,944				20,810				23,679				60,927				109,259
Total Investment Income (Loss)		50,095				335,967				330,497				684,722				(245,846		)
Total Segment Revenues		769,685				1,265,138				1,031,537				3,057,521				1,200,909
Segment Expenses
Compensation and Benefits
Cash Compensation and Benefits		130,621				135,522				101,967				405,578				299,756
Realized Performance Income Compensation		177,705				111,917				159,151				377,689				322,671
Unrealized Performance Income Compensation		(19,826		)		119,774				29,393				157,162				(48,724		)
Total Compensation and Benefits		288,500				367,213				290,511				940,429				573,703
Occupancy and Related Charges		14,672				13,407				15,877				42,448				47,486
Other Operating Expenses		70,517				53,069				55,123				177,084				166,542
Total Segment Expenses		373,689				433,689				361,511				1,159,961				787,731
Income (Loss) attributable to noncontrolling interests		1,046				1,180				760				3,810				2,002
Economic Net Income (Loss)		394,950				830,269				669,266				1,893,750				411,176
Equity-based Compensation		54,921				44,976				50,270				149,840				148,257
Pre-tax Economic Net Income (Loss)		340,029				785,293				618,996				1,743,910				262,919
Provision for Income Tax (Benefit)		23,317				24,408				12,611				108,050				12,617
Preferred Distributions		8,341				8,341				8,201				25,023				13,894
After-tax Economic Net Income (Loss)		$	308,371			$	752,544			$	598,184			$	1,610,837			$	236,408
After-tax Economic Net Income (Loss) Per Adjusted Unit		$	0.36			$	0.89			$	0.71			$	1.90			$	0.28
Weighted Average Adjusted Units (Fully Diluted Basis)		848,087,704				847,650,747				837,504,674				848,332,124				841,988,454
Other Operating Measures:
Fee Related Earnings (1)		$	191,880			$	214,357			$	142,253			$	628,226			$	421,012
After-tax Distributable Earnings (2)		$	464,454			$	321,922			$	461,498			$	1,132,843			$	1,137,822
Assets Under Management		$	153,339,500			$	148,483,000			$	131,101,800			$	153,339,500			$	131,101,800
Fee Paying Assets Under Management		$	113,723,000			$	112,646,200			$	93,153,800			$	113,723,000			$	93,153,800
Capital Invested and Syndicated Capital		$	5,144,800			$	5,369,400			$	4,392,000			$	17,073,300			$	9,738,200
Uncalled Commitments		$	47,250,500			$	42,551,600			$	38,267,300			$	47,250,500			$	38,267,300

Note: See "Notes to Reportable Segments" for more information about certain non-GAAP financial measures and Exhibits C and D for a reconciliation of such measures to the financial results presented in accordance with GAAP.

⁽¹⁾ See Exhibit A "Other Financial Information" for the definition and calculation of Fee Related Earnings.

⁽²⁾ See page 8 for the calculation of After-tax Distributable Earnings.

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KKR
CALCULATION OF DISTRIBUTABLE SEGMENT REVENUES (UNAUDITED) (1)
(Amounts in thousands)
		Quarter Ended												Nine Months Ended
		September 30, 2017				June 30, 2017				September 30, 2016				September 30, 2017				September 30, 2016
Distributable Segment Revenues
Fees and Other, Net
Management Fees		$	232,954			$	229,569			$	201,508			$	670,807			$	599,725
Monitoring Fees		14,342				30,510				11,091				58,072				52,126
Transaction Fees		179,167				156,465				111,354				578,667				276,003
Fee Credits		(70,747		)		(51,384		)		(47,392		)		(211,148		)		(109,272		)
Total Fees and Other, Net		355,716				365,160				276,561				1,096,398				818,582
Realized Performance Income (Loss)
Incentive Fees		4,074				2,624				3,659				8,384				9,897
Carried Interest		419,438				264,668				350,469				890,310				753,032
Total Realized Performance Income (Loss)		423,512				267,292				354,128				898,694				762,929
Realized Investment Income (Loss)
Net Realized Gains (Losses)		76,053				7,180				170,078				162,684				370,594
Interest Income and Dividends		70,557				67,836				71,185				195,275				253,756
Interest Expense		(45,613		)		(47,026		)		(47,506		)		(134,348		)		(144,497		)
Total Realized Investment Income (Loss)		100,997				27,990				193,757				223,611				479,853
Total Distributable Segment Revenues		$	880,225			$	660,442			$	824,446			$	2,218,703			$	2,061,364
CALCULATION OF DISTRIBUTABLE SEGMENT EXPENSES (UNAUDITED) (1)
(Amounts in thousands)
		Quarter Ended												Nine Months Ended
		September 30, 2017				June 30, 2017				September 30, 2016				September 30, 2017				September 30, 2016
Distributable Segment Expenses
Compensation and Benefits
Cash Compensation and Benefits		130,621				135,522				101,967				405,578				299,756
Performance Income Compensation		177,705				111,917				159,151				377,689				322,671
Total Compensation and Benefits		308,326				247,439				261,118				783,267				622,427
Occupancy and Related Charges		14,672				13,407				15,877				42,448				47,486
Other Operating Expenses		70,517				53,069				55,123				177,084				166,542
Total Distributable Segment Expenses		$	393,515			$	313,915			$	332,118			$	1,002,799			$	836,455
CALCULATION OF AFTER-TAX DISTRIBUTABLE EARNINGS (UNAUDITED) (1)
(Amounts in thousands, except per unit amounts)
		Quarter Ended												Nine Months Ended
		September 30, 2017				June 30, 2017				September 30, 2016				September 30, 2017				September 30, 2016
After-tax Distributable Earnings
Distributable Segment Revenues		880,225				660,442				824,446				2,218,703				2,061,364
Distributable Segment Expenses		393,515				313,915				332,118				1,002,799				836,455
Income (Loss) Attributable to Noncontrolling Interests		1,046				1,180				760				3,810				2,002
Income Taxes Paid		12,869				15,084				21,869				54,228				71,191
Preferred Distributions		8,341				8,341				8,201				25,023				13,894
After-tax Distributable Earnings		$	464,454			$	321,922			$	461,498			$	1,132,843			$	1,137,822
Per Adjusted Unit Eligible for Distribution		$	0.57			$	0.39			$	0.57			$	1.39			$	1.41

⁽¹⁾ See Exhibit C for reconciliations of (i) Fees and other (GAAP basis) to Total Distributable Segment Revenues, (ii) Total Expenses (GAAP basis) to Total Distributable Segment Expenses and (iii) Net Income (Loss) attributable to KKR & Co. L.P. common unitholders (GAAP basis) to After-tax Distributable Earnings. See Exhibit D for a reconciliation of GAAP Common Units Outstanding to Adjusted Units Eligible for Distribution.

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KKR
SCHEDULE OF SEGMENT REVENUES AND OTHER SELECTED FINANCIAL INFORMATION (UNAUDITED)
(Amounts in thousands)
PRIVATE MARKETS
		Quarter Ended												Nine Months Ended
		September 30, 2017				June 30, 2017				September 30, 2016				September 30, 2017				September 30, 2016
Segment Revenues
Management, Monitoring and Transaction Fees, Net
Management Fees		$	153,841			$	142,253			$	117,795			$	419,606			$	354,376
Monitoring Fees		14,342				30,510				11,091				58,072				52,126
Transaction Fees		82,258				37,252				53,223				237,392				114,021
Fee Credits		(59,854		)		(31,750		)		(37,127		)		(177,254		)		(93,042		)
Total Management, Monitoring and Transaction Fees, Net		190,587				178,265				144,982				537,816				427,481
Performance Income (Loss)
Realized Incentive Fees		—				—				—				—				—
Realized Carried Interest		419,438				264,668				350,469				890,310				749,194
Unrealized Carried Interest		(96,571		)		279,010				53,339				305,945				(131,386		)
Total Performance Income (Loss)		322,867				543,678				403,808				1,196,255				617,808
Investment Income (Loss)
Net Realized Gains (Losses)		—				—				—				—				—
Net Unrealized Gains (Losses)		—				—				—				—				—
Total Realized and Unrealized		—				—				—				—				—
Interest Income and Dividends		—				—				—				—				—
Interest Expense		—				—				—				—				—
Net Interest and Dividends		—				—				—				—				—
Total Investment Income (Loss)		—				—				—				—				—
Total Segment Revenues		$	513,454			$	721,943			$	548,790			$	1,734,071			$	1,045,289
Assets Under Management		$	87,609,800			$	84,984,000			$	75,181,600			$	87,609,800			$	75,181,600
Fee Paying Assets Under Management		$	61,706,500			$	62,008,900			$	44,010,300			$	61,706,500			$	44,010,300
Capital Invested		$	2,972,300			$	3,623,300			$	2,370,600			$	11,079,800			$	5,475,300
Uncalled Commitments		$	39,421,900			$	35,792,900			$	31,839,100			$	39,421,900			$	31,839,100

PUBLIC MARKETS
		Quarter Ended												Nine Months Ended
		September 30, 2017				June 30, 2017				September 30, 2016				September 30, 2017				September 30, 2016
Segment Revenues
Management, Monitoring and Transaction Fees, Net
Management Fees (1)		$	79,113			$	87,316			$	83,713			$	251,201			$	245,349
Monitoring Fees		—				—				—				—				—
Transaction Fees		11,469				25,515				10,748				41,040				17,768
Fee Credits		(10,893		)		(19,634		)		(10,265		)		(33,894		)		(16,230		)
Total Management, Monitoring and Transaction Fees, Net		79,689				93,197				84,196				258,347				246,887
Performance Income (Loss)
Realized Incentive Fees		4,074				2,624				3,659				8,384				9,897
Realized Carried Interest		—				—				—				—				3,838
Unrealized Carried Interest		36,933				17,709				17,012				71,762				(3,370		)
Total Performance Income (Loss)		41,007				20,333				20,671				80,146				10,365
Investment Income (Loss)
Net Realized Gains (Losses)		—				—				—				—				—
Net Unrealized Gains (Losses)		—				—				—				—				—
Total Realized and Unrealized		—				—				—				—				—
Interest Income and Dividends		—				—				—				—				—
Interest Expense		—				—				—				—				—
Net Interest and Dividends		—				—				—				—				—
Total Investment Income (Loss)		—				—				—				—				—
Total Segment Revenues		$	120,696			$	113,530			$	104,867			$	338,493			$	257,252
Assets Under Management		$	65,729,700			$	63,499,000			$	55,920,200			$	65,729,700			$	55,920,200
Fee Paying Assets Under Management		$	52,016,500			$	50,637,300			$	49,143,500			$	52,016,500			$	49,143,500
Capital Invested		$	1,639,200			$	1,293,100			$	1,484,400			$	3,825,900			$	3,049,400
Uncalled Commitments		$	7,828,600			$	6,758,700			$	6,428,200			$	7,828,600			$	6,428,200

⁽¹⁾ KKR reflects its allocation of the net income of PAAMCO Prisma as management fees and realized incentive fees.  Accordingly, the management fees and other revenues and expenses of Prisma that had been reported on a gross basis prior to the closing of the transaction on June 1, 2017 are reported on a net basis as part of our allocation of the net income of PAAMCO Prisma after June 1, 2017.

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KKR
SCHEDULE OF SEGMENT REVENUES AND OTHER SELECTED FINANCIAL INFORMATION (UNAUDITED)
(Amounts in thousands)
CAPITAL MARKETS
		Quarter Ended												Nine Months Ended
		September 30, 2017				June 30, 2017				September 30, 2016				September 30, 2017				September 30, 2016
Segment Revenues
Management, Monitoring and Transaction Fees, Net
Management Fees		$	—			$	—			$	—			$	—			$	—
Monitoring Fees		—				—				—				—				—
Transaction Fees		85,440				93,698				47,383				300,235				144,214
Fee Credits		—				—				—				—				—
Total Management, Monitoring and Transaction Fees, Net		85,440				93,698				47,383				300,235				144,214
Performance Income (Loss)
Realized Incentive Fees		—				—				—				—				—
Realized Carried Interest		—				—				—				—				—
Unrealized Carried Interest		—				—				—				—				—
Total Performance Income (Loss)		—				—				—				—				—
Investment Income (Loss)
Net Realized Gains (Losses)		—				—				—				—				—
Net Unrealized Gains (Losses)		—				—				—				—				—
Total Realized and Unrealized		—				—				—				—				—
Interest Income and Dividends		—				—				—				—				—
Interest Expense		—				—				—				—				—
Net Interest and Dividends		—				—				—				—				—
Total Investment Income (Loss)		—				—				—				—				—
Total Segment Revenues		$	85,440			$	93,698			$	47,383			$	300,235			$	144,214
Syndicated Capital		$	533,300			$	453,000			$	537,000			$	2,167,600			$	1,213,500

PRINCIPAL ACTIVITIES
		Quarter Ended												Nine Months Ended
		September 30, 2017				June 30, 2017				September 30, 2016				September 30, 2017				September 30, 2016
Segment Revenues
Management, Monitoring and Transaction Fees, Net
Management Fees		$	—			$	—			$	—			$	—			$	—
Monitoring Fees		—				—				—				—				—
Transaction Fees		—				—				—				—				—
Fee Credits		—				—				—				—				—
Total Management, Monitoring and Transaction Fees, Net		—				—				—				—				—
Performance Income (Loss)
Realized Incentive Fees		—				—				—				—				—
Realized Carried Interest		—				—				—				—				—
Unrealized Carried Interest		—				—				—				—				—
Total Performance Income (Loss)		—				—				—				—				—
Investment Income (Loss)
Net Realized Gains (Losses)		76,053				7,180				170,078				162,684				370,594
Net Unrealized Gains (Losses)		(50,902		)		307,977				136,740				461,111				(725,699		)
Total Realized and Unrealized		25,151				315,157				306,818				623,795				(355,105		)
Interest Income and Dividends		70,557				67,836				71,185				195,275				253,756
Interest Expense		(45,613		)		(47,026		)		(47,506		)		(134,348		)		(144,497		)
Net Interest and Dividends		24,944				20,810				23,679				60,927				109,259
Total Investment Income (Loss)		50,095				335,967				330,497				684,722				(245,846		)
Total Segment Revenues		$	50,095			$	335,967			$	330,497			$	684,722			$	(245,846	)

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KKR
BALANCE SHEET
TOTAL REPORTABLE SEGMENTS (UNAUDITED)
(Amounts in thousands, except per unit amounts)
		As of
		September 30, 2017						December 31, 2016
Cash and Short-term Investments		$	3,623,773					$	3,387,673
Investments		8,123,514				(1)		6,958,873
Unrealized Carry		1,474,693				(2)		1,213,692				(2)
Other Assets		1,964,794						1,611,678
Corporate Real Estate		161,225						161,225
Total Assets		$	15,347,999					$	13,333,141
Debt Obligations - KKR (ex-KFN)		$	2,000,000					$	2,000,000
Debt Obligations - KFN		639,767						398,560
Preferred Shares - KFN		373,750						373,750
Other Liabilities		596,079						244,676
Total Liabilities		3,609,596						3,016,986
Noncontrolling Interests		20,849						19,564
Preferred Units		500,000						500,000
Book Value		$	11,217,554					$	9,796,591
Book Value Per Outstanding Adjusted Unit (3)		$	13.80					$	12.15
		Last Twelve Months Ended
		September 30, 2017						December 31, 2016
Return on Equity (After-tax Economic Net Income (Loss) ) (4)		19%						6%
Return on Equity (After-tax Distributable Earnings) (5)		15%						16%

Note: As of September 30, 2017, KKR had a $1.0 billion revolving credit facility, which was undrawn. In addition, KKR has $1.3 billion in revolving credit facilities for use in its capital markets business, which were undrawn as of September 30, 2017. As of September 30, 2017, KKR’s portion of total uncalled commitments to its investment funds was $2.9 billion. See Exhibit B for details.

⁽¹⁾ See schedule of investments that follows on the next page.

⁽²⁾ The following table provides unrealized carry by segment:

		As of
		September 30, 2017						December 31, 2016
Private Markets		$	1,347,729					$	1,141,610
Public Markets		126,964						72,082
Total		$	1,474,693					$	1,213,692

⁽³⁾ See reconciliation in Exhibit D for calculation of Outstanding Adjusted Units.

⁽⁴⁾ Return on Equity (After-tax Economic Net Income (Loss) ) measures the amount of after-tax economic net income generated as a percentage of capital invested in KKR’s business. Return on equity is calculated by dividing After-tax Economic Net Income (Loss) on a trailing twelve-month basis by the average book value during the period. We believe this measure is useful to unitholders as it provides a measure of the overall profitability of KKR’s businesses as a percentage of net assets in KKR's business.

⁽⁵⁾ Return on Equity (After-tax Distributable Earnings) measures the amount of income excluding the impact of mark-to-market gain (losses) generated as a percentage of capital invested in KKR’s business. It is calculated by dividing after-tax distributable earnings on a trailing twelve-month basis by the average book value during the period. We believe this measure is useful to unitholders as it provides a measure of the overall profitability of KKR’s businesses, excluding the impact of mark-to-market gains (losses), as a percentage of net assets in KKR's business.

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KKR

SCHEDULE OF INVESTMENTS (1)

TOTAL REPORTABLE SEGMENTS (UNAUDITED)

(Amounts in thousands, except percentage amounts)

As of September 30, 2017
Investments		Carrying Value
Private Equity Co-Investments and Other Equity		$	2,697,619
Private Equity Funds		1,348,599
Private Equity Total		4,046,218
Energy		549,607
Real Estate		795,042
Infrastructure		370,318
Real Assets Total		1,714,967
Special Situations		820,148
Direct Lending		97,111
Mezzanine		39,052
Alternative Credit Total		956,311
CLOs		578,587
Liquid Credit		152,699
Specialty Finance		209,755
Credit Total		1,897,352
Other		464,977
Total Investments		$	8,123,514

		As of September 30, 2017
Significant Investments: (3)		Carrying Value				Carrying Value as a Percentage of Total Investments
First Data Corporation		$	1,279,098			15.7	%
USI, Inc.		503,711				6.2	%
KKR Real Estate Finance Trust Inc.		325,000				4.0	%
PortAventura Entertainment S.A.		255,821				3.1	%
Natural Gas Midstream Investment		209,728				2.6	%
Total Significant Investments		2,573,358				31.6	%
Other Investments		5,550,156				68.4	%
Total Investments		$	8,123,514			100.0	%

⁽¹⁾ Investments is a term used solely for purposes of financial presentation of a portion of KKR’s balance sheet and includes majority ownership of subsidiaries that operate KKR’s asset management and broker-dealer businesses, including the general partner interests of KKR’s investment funds. Investments also include our ownership of $325.0 million in KKR Real Estate Finance Trust Inc. and $305.1 million of CLOs which are not held for investment purposes and held at cost.

⁽²⁾ General partner commitments in our funds are included in the various asset classes shown above. Private Equity and Other Equity includes KKR private equity funds, co-investments alongside such KKR sponsored private equity funds, core private equity co-investments and other opportunistic investments. However, equity investments in other asset classes, such as real estate, special situations and energy appear in these other asset classes.  Other Credit consists of liquid credit and specialty finance strategies.

⁽³⁾ The significant investments include the top five investments (other than investments expected to be syndicated or transferred in connection with new fundraising) based on their carrying values as of September 30, 2017. The carrying value figures include the co-investment and the limited partner and/or general partner interests held by KKR in the underlying investment, if applicable.

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KKR
ASSETS UNDER MANAGEMENT (UNAUDITED)
(Amounts in thousands)
		Private Markets Segment				Public Markets Segment				Total Reportable Segments
Quarter Ended September 30, 2017
June 30, 2017		$	84,984,000			$	63,499,000			$	148,483,000
New Capital Raised		4,287,200				3,392,200				7,679,400
Distributions		(3,798,300		)		(1,832,900		)	(2)	(5,631,200		)
Change in Value		2,136,900				671,400				2,808,300
September 30, 2017		$	87,609,800			$	65,729,700			$	153,339,500
Nine Months Ended September 30, 2017
December 31, 2016		$	73,815,500			$	55,740,200			$	129,555,700
New Capital Raised		15,367,500				7,608,900				22,976,400
Impact of Other Transactions		—				3,811,400			(1)	3,811,400
Distributions and Other		(9,166,800		)	(5)	(4,545,800		)	(3)	(13,712,600		)
Change in Value		7,593,600				3,115,000				10,708,600
September 30, 2017		$	87,609,800			$	65,729,700			$	153,339,500
Trailing Twelve Months Ended September 30, 2017
September 30, 2016		$	75,181,600			$	55,920,200			$	131,101,800
New Capital Raised		17,159,200				10,291,500				27,450,700
Impact of Other Transactions		—				3,811,400			(1)	3,811,400
Distributions and Other		(13,588,800		)	(5)	(7,273,600		)	(4)	(20,862,400		)
Change in Value		8,857,800				2,980,200				11,838,000
September 30, 2017		$	87,609,800			$	65,729,700			$	153,339,500

⁽¹⁾ Represents the impact of the PAAMCO Prisma transaction.

⁽²⁾ Includes $559.5 million of redemptions by fund investors.

⁽³⁾ Includes $2,029.6 million of redemptions by fund investors.

⁽⁴⁾ Includes $3,549.4 million of redemptions by fund investors.

⁽⁵⁾ Includes $774.8 million of expired commitments that are no longer eligible to be called.

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KKR
FEE PAYING ASSETS UNDER MANAGEMENT (UNAUDITED)
(Amounts in thousands)
		Private Markets Segment				Public Markets Segment				Total Reportable Segments
Quarter Ended September 30, 2017
June 30, 2017		$	62,008,900			$	50,637,300			$	112,646,200
New Capital Raised		1,202,900				2,950,000				4,152,900
Distributions		(1,968,700		)		(2,311,600		)	(2)	(4,280,300		)
Change in Value		463,400				740,800				1,204,200
September 30, 2017		$	61,706,500			$	52,016,500			$	113,723,000
Nine Months Ended September 30, 2017
December 31, 2016		$	52,204,800			$	49,268,600			$	101,473,400
New Capital Raised		14,653,000				7,630,100				22,283,100
Impact of Other Transactions		—				(1,600,000		)	(1)	(1,600,000		)
Distributions		(3,719,400		)		(5,824,200		)	(3)	(9,543,600		)
Net Changes in Fee Base of Certain Funds (5)		(2,418,800		)		—				(2,418,800		)
Change in Value		986,900				2,542,000				3,528,900
September 30, 2017		$	61,706,500			$	52,016,500			$	113,723,000
Trailing Twelve Months Ended September 30, 2017
September 30, 2016		$	44,010,300			$	49,143,500			$	93,153,800
New Capital Raised		26,893,500				10,808,300				37,701,800
Impact of Other Transactions		—				(1,600,000		)	(1)	(1,600,000		)
Distributions		(5,408,600		)		(8,688,600		)	(4)	(14,097,200		)
Net Changes in Fee Base of Certain Funds (5)		(4,619,900		)		—				(4,619,900		)
Change in Value		831,200				2,353,300				3,184,500
September 30, 2017		$	61,706,500			$	52,016,500			$	113,723,000

⁽¹⁾ Represents the impact of the PAAMCO Prisma transaction.

⁽²⁾ Includes $559.5 million of redemptions by fund investors.

⁽³⁾ Includes $2,029.6 million of redemptions by fund investors.

⁽⁴⁾ Includes $3,549.4 million of redemptions by fund investors.

⁽⁵⁾ Represents the impact of certain funds entering their post-investment period.

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KKR
INVESTMENT VEHICLE SUMMARY (1) (UNAUDITED)
As of September 30, 2017
(Amounts in millions, except percentages)
	Investment Period		Amount
	Start Date	End Date	Commitment			Uncalled Commitments			Percentage Committed by General Partner	Invested			Realized			Remaining Cost			Remaining Fair Value
Private Markets
Private Equity and Growth Funds
Asian Fund III (2)	4/2017	4/2023	$	9,000.0		$	9,000.0		5.6%	$	—		$	—		$	—		$	—
Americas Fund XII (2)	1/2017	1/2023	13,500.0			13,500.0			7.2%	—			—			—			5.6
Health Care Strategic Growth (2)	12/2016	12/2021	1,214.9			1,214.9			12.3%	—			—			—			—
Next Generation Technology Growth (2)	3/2016	3/2021	658.9			431.3			22.5%	227.6			—			227.6			325.1
European Fund IV (2)	12/2014	12/2020	3,537.4			1,507.5			5.6%	2,059.6			29.2			2,038.7			2,629.8
Asian Fund II (2)	4/2013	4/2017	5,825.0			1,012.7			1.3%	5,782.0			1,469.1			4,749.0			7,070.8
North America Fund XI (2)	9/2012	1/2017	8,718.4			874.2			2.9%	9,268.2			4,344.4			6,743.5			11,525.2
China Growth Fund	11/2010	11/2016	1,010.0			—			1.0%	1,010.0			565.0			665.3			801.4
E2 Investors (Annex Fund)	8/2009	11/2013	195.8			—			4.9%	195.8			195.7			18.1			1.7
European Fund III	3/2008	3/2014	6,165.5			838.2			4.6%	5,327.3			6,989.1			2,029.3			3,427.6
Asian Fund	7/2007	4/2013	3,983.3			—			2.5%	3,945.9			7,681.6			813.8			917.2
2006 Fund	9/2006	9/2012	17,642.2			337.7			2.1%	17,304.5			26,586.4			4,957.8			6,960.9
European Fund II	11/2005	10/2008	5,750.8			—			2.1%	5,750.8			8,467.3			—			58.4
Millennium Fund	12/2002	12/2008	6,000.0			—			2.5%	6,000.0			13,305.4			444.9			610.6
Total Private Equity and Growth			83,202.2			28,716.5				56,871.7			69,633.2			22,688.0			34,334.3
Co-Investment Vehicles and Other (2)	Various	Various	6,674.1			1,830.0			Various	5,042.9			2,712.0			3,686.4			4,848.5
Total Private Equity and Growth			89,876.3			30,546.5				61,914.6			72,345.2			26,374.4			39,182.8
Real Assets
Energy Income and Growth Fund (2)	9/2013	9/2018	1,974.2			667.7			12.9%	1,336.5			284.1			1,072.6			1,132.7
Natural Resources Fund	Various	Various	887.4			2.8			Various	884.6			113.4			794.9			151.9
Global Energy Opportunities (2)	Various	Various	979.2			613.2			Various	405.5			59.0			291.0			315.0
Global Infrastructure Investors (2)	9/2011	10/2014	1,040.2			59.9			4.8%	1,011.3			844.8			604.2			775.9
Global Infrastructure Investors II (2)	10/2014	10/2020	3,045.4			1,820.2			4.1%	1,412.3			192.9			1,221.0			1,532.5
Real Estate Partners Americas (2)	5/2013	5/2017	1,229.1			363.3			16.3%	993.7			776.0			562.2			631.9
Real Estate Partners Americas II (2)	5/2017	(4)	782.7			782.7			19.2%	—			—			—			—
Real Estate Partners Europe (2)	9/2015	6/2020	721.2			594.7			9.2%	132.6			12.0			125.4			158.1
Real Estate Credit Opportunity Partners (2)	2/2017	2/2019	1,090.0			918.0			4.6%	172.0			—			172.0			184.4
Co-Investment Vehicles and Other	Various	Various	1,401.9			11.8			Various	1,390.1			511.9			1,387.7			1,799.8
Real Assets			13,151.3			5,834.3				7,738.6			2,794.1			6,231.0			6,682.2
Unallocated Commitments (5)			3,041.1			3,041.1			Various	—			—			—			—
Private Markets Total			106,068.7			39,421.9				69,653.2			75,139.3			32,605.4			45,865.0
Public Markets (3)
Special Situations Fund	12/2012	1/2016	2,274.3			42.7			11.6%	2,231.6			690.1			1,887.3			2,024.7
Special Situations Fund II	12/2014	3/2019	3,285.8			1,938.2			9.0%	1,347.6			—			1,347.6			1,320.1
Mezzanine Partners	3/2010	3/2015	1,022.8			100.9			4.4%	921.9			812.5			470.3			488.6
Lending Partners	12/2011	12/2014	460.2			54.9			15.2%	405.3			321.0			264.2			195.7
Lending Partners II	6/2014	6/2017	1,335.9			199.2			3.7%	1,136.7			258.9			1,116.2			1,158.6
Lending Partners III	4/2017	(4)	795.8			760.0			3.3%	35.8			—			35.8			41.9
Lending Partners Europe	3/2015	3/2019	847.6			523.5			5.0%	324.1			42.3			324.1			344.7
Other Alternative Credit Vehicles	Various	Various	6,336.0			2,809.2			Various	3,526.8			1,973.0			2,502.6			2,822.1
Unallocated Commitments (5)	Various	Various	1,400.0			1,400.0			Various	—			—			—			—
Public Markets Total			17,758.4			7,828.6				9,929.8			4,097.8			7,948.1			8,396.4
Grand Total			$	123,827.1		$	47,250.5			$	79,583.0		$	79,237.1		$	40,553.5		$	54,261.4

⁽¹⁾ Reflects investment vehicles for which KKR has the ability to earn carried interest and excludes open ended funds, managed accounts, CLOs and certain other investment vehicles where KKR earns an incentive fee.

⁽²⁾ The “Invested” and “Realized” columns include the amounts of any realized investments that restored the unused capital commitments of the fund investors, if any.

⁽³⁾ The "Commitment" and "Uncalled Commitments" columns include income that is eligible to be reinvested if permitted under the terms of the investment vehicle agreements.

⁽⁴⁾ Three years from final closing date.

⁽⁵⁾ Represents unallocated commitments from our strategic investor partnerships.

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KKR

Notes to Reportable Segments (Unaudited)

The segment key performance measures that follow are used by management in making operating and resource deployment decisions as well as assessing the overall performance of each of KKR’s reportable business segments. The reportable segments for KKR’s business are presented prior to giving effect to the allocation of income (loss) between KKR & Co. L.P. and KKR Holdings L.P. and as such represent the business in total. In addition, KKR’s reportable segments are presented without giving effect to the consolidation of the funds that KKR manages.

KKR discloses the following financial measures in this earnings release that are calculated and presented using methodologies other than in accordance with GAAP. We believe that providing these performance measures on a supplemental basis to our GAAP results is helpful to unitholders in assessing the overall performance of KKR’s businesses. These financial measures should not be considered as a substitute for similar financial measures calculated in accordance with GAAP. We caution readers that these non-GAAP financial measures may differ from the calculations of other investment managers, and as a result, may not be comparable to similar measures presented by other investment managers. Reconciliations of these non-GAAP financial measures to the most directly comparable financial measures calculated and presented in accordance with GAAP are included elsewhere within this earnings release.

Adjusted units are used as a measure of the total common equity ownership of KKR that is held by KKR & Co. L.P. (including equity awards issued under the KKR & Co. L.P. 2010 Equity Incentive Plan (the "Equity Incentive Plan"), but excluding preferred units), KKR Holdings and other holders of securities exchangeable into common units of KKR & Co. L.P. and represent the fully diluted common unit count using the if-converted method. We believe this measure is useful to unitholders as it provides an indication of the total common equity ownership of KKR as if all outstanding KKR Holdings units, equity awards issued under the Equity Incentive Plan and other exchangeable securities had been exchanged for common units of KKR & Co. L.P. The Series A and Series B Preferred Units are not exchangeable for common units of KKR & Co. L.P.

Adjusted units eligible for distribution represents the portion of total adjusted units that is eligible to receive a distribution. We believe this measure is useful to unitholders as it provides insight into the calculation of amounts available for distribution on a per unit basis. Adjusted units eligible for distribution is used in the calculation of after-tax distributable earnings per unit.

After-tax distributable earnings is used by management as an operating measure of the earnings excluding mark-to-market gains (losses) of KKR. KKR believes this measure is useful to unitholders as it provides a supplemental measure to assess performance, excluding the impact of mark-to-market gains (losses). After-tax distributable earnings excludes certain realized investment losses to the extent unrealized losses on these investments were recognized prior to the combination with KPE on October 1, 2009. After-tax distributable earnings does not represent and is not used to calculate actual distributions under KKR’s distribution policy.

Assets under management ("AUM") represent the assets managed or advised by KKR from which KKR is entitled to receive fees or a carried interest (either currently or upon deployment of capital), general partner capital, and assets managed or advised by strategic partners in which KKR holds a minority ownership interest. We believe this measure is useful to unitholders as it provides additional insight into the capital raising activities of KKR and its strategic partners and the overall activity in their investment funds and other managed capital. KKR calculates the amount of AUM as of any date as the sum of: (i) the fair value of the investments of KKR's investment funds; (ii) uncalled capital commitments from these funds, including uncalled capital commitments from which KKR is currently not earning management fees or carried interest; (iii) the fair value of investments in KKR's co-investment vehicles; (iv) the par value of outstanding CLOs (excluding CLOs wholly-owned by KKR); (v) KKR's pro-rata portion of the AUM of strategic partners in which KKR holds a minority ownership interest, and (vi) the fair value of other assets managed by KKR. The pro-rata portion of the AUM of strategic partners is calculated based on KKR’s percentage ownership interest in such entities multiplied by such entity’s respective AUM. KKR's definition of AUM is not based on any definition of AUM that may be set forth in the agreements governing the investment funds, vehicles or accounts that it manages or calculated pursuant to any regulatory definitions.

Book value is a measure of the net assets of KKR’s reportable segments and is used by management primarily in assessing the unrealized value of KKR’s investments and other assets, including carried interest. We believe this measure is useful to unitholders as it provides additional insight into the assets and liabilities of KKR excluding the assets and liabilities that are allocated to noncontrolling interest holders and to the holders of the Series A and Series B Preferred Units.

Capital invested is the aggregate amount of capital invested by (i) KKR’s investment funds, (ii) KKR's Principal Activities segment as a co-investment, if any, alongside KKR’s investment funds, and (iii) KKR's Principal Activities segment in connection with a syndication transaction conducted by KKR's Capital Markets segment, if any.  Capital invested is used as a measure of investment activity at KKR during a given period. We believe this measure is useful to unitholders as it provides a measure of capital deployment across KKR’s business segments.  Capital invested includes investments made using investment financing arrangements like credit facilities, as applicable.  Capital invested excludes (i) investments in liquid credit strategies, (ii) capital invested by KKR’s Principal Activities segment that is not a co-investment alongside KKR’s investment funds, and (iii) capital invested by KKR’s Principal Activities segment that is not invested in connection with a syndication transaction by KKR’s Capital Markets segment. Capital syndicated by KKR's Capital Markets segment to third parties other than KKR’s investment funds or Principal Activities segment is not included in capital invested.  See also syndicated capital. In the fourth quarter of 2016, the capital invested metric was changed to include capital invested by KKR's Principal Activities segment and all prior periods in this report have been adjusted.

Cash and short-term investments represent cash and liquid short-term investments in high-grade, short-duration cash management strategies used by KKR to generate additional yield on our excess liquidity and is used by management in evaluating KKR’s liquidity position. We believe this measure is useful to unitholders as it provides additional insight into KKR’s available liquidity.

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Economic net income (loss) (“ENI”) is a measure of profitability for KKR’s reportable segments and is used by management as an alternative measurement of the operating and investment earnings of KKR and its business segments. We believe this measure is useful to unitholders as it provides additional insight into the overall profitability of KKR’s businesses inclusive of carried interest, incentive fees and related carry pool allocations and investment income. ENI is comprised of total segment revenues less total segment expenses and certain economic interests in KKR’s segments held by third parties. For a reconciliation of total segment revenues, total segment expenses and ENI to the most directly comparable amounts recognized under GAAP, see reconciliations at Exhibit C. Pre-tax Economic Net Income (Loss) represents Economic Net Income (Loss) after equity-based compensation. After-tax Economic Net Income (Loss) represents Economic Net Income (Loss) after equity-based compensation, provision for income taxes and preferred distributions.

Fee paying AUM ("FPAUM") represents only the AUM from which KKR receives management fees. We believe this measure is useful to unitholders as it provides additional insight into the capital base upon which KKR earns management fees. FPAUM is the sum of all of the individual fee bases that are used to calculate KKR's and its strategic partners' management fees and differs from AUM in the following respects: (i) assets and commitments from which KKR does not receive a management fee are excluded (e.g., assets and commitments with respect to which it receives only carried interest or is otherwise not currently receiving a management fee) and (ii) certain assets, primarily in its private equity funds, are reflected based on capital commitments and invested capital as opposed to fair value because fees are not impacted by changes in the fair value of underlying investments.

Investments is a term used solely for purposes of financial presentation of a portion of KKR’s balance sheet and includes majority ownership of subsidiaries that operate KKR’s asset management and broker-dealer businesses, including the general partner interests of KKR’s investment funds.

Outstanding adjusted units represents the portion of total adjusted units that would receive assets of KKR if it were to be liquidated as of a particular date. Outstanding adjusted units is used to calculate book value per outstanding adjusted unit, which we believe is useful to unitholders as it provides a measure of net assets of KKR’s reportable segments on a per unit basis.

Realized performance income compensation is the amount allocated to performance income compensation equal to 40% of the carried interest and incentive fees earned by our investment funds, and, beginning with the quarter ended September 30, 2016, includes 40% of the management fees that would have been subject to a management fee refund for investment funds that have a preferred return. Beginning with the quarter ended September 30, 2017, 43% of carried interest generated by certain recent and future funds is allocated to the carry pool instead of 40% of carried interest. The incremental 3% replaces the amount of certain management fee refunds that would have been calculated for those funds as performance income compensation. Had this change been applied during the trailing twelve months ended September 30, 2017, there would have been no material change to the total performance fee compensation reportable for such period.

Syndicated capital is generally the aggregate amount of capital in transactions originated by KKR and its investment funds and carry-yielding co-investment vehicles, which has been distributed to third parties in exchange for a fee. It does not include (i) capital invested in such transactions by KKR investment funds and carry-yielding co-investment vehicles, which is instead reported in capital invested, (ii) debt capital that is arranged as part of the acquisition financing of transactions originated by KKR investment funds and (iii) debt capital that is either underwritten or arranged on a best efforts basis. Syndicated capital is used as a measure of investment activity for KKR during a given period, and we believe that this measure is useful to unitholders as it provides additional insight into levels of syndication activity in KKR's Capital Markets segment and across KKR's investment platform.

Uncalled commitments are used as a measure of unfunded capital commitments that KKR’s investment funds and carry-paying co-investment vehicles have received from partners to contribute capital to fund future investments. We believe this measure is useful to unitholders as it provides additional insight into the amount of capital that is available to KKR’s investment funds to make future investments. Uncalled commitments are not reduced for investments completed using fund-level investment financing arrangements.

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KKR
EXHIBIT A
OTHER FINANCIAL INFORMATION (UNAUDITED)
(Amounts in thousands)
		Quarter Ended												Nine Months Ended
		September 30, 2017				June 30, 2017				September 30, 2016				September 30, 2017				September 30, 2016
Fee Related Earnings
Management, Monitoring and Transaction Fees, Net		$	355,716			$	365,160			$	276,561			$	1,096,398			$	818,582
Less: Cash Compensation and Benefits		130,621				135,522				101,967				405,578				299,756
Less: Occupancy and Related Charges		14,672				13,407				15,877				42,448				47,486
Less: Other Operating Expenses		70,517				53,069				55,123				177,084				166,542
Plus: Expenses of Principal Activities Segment		51,974				51,195				38,659				156,938				116,214
Fee Related Earnings (1)		191,880				214,357				142,253				628,226				421,012
Plus: Net Interest and Dividends		24,944				20,810				23,679				60,927				109,259
Plus: Depreciation and Amortization		3,709				3,864				4,121				11,750				11,967
Plus: Core Interest Expense		29,587				30,642				29,006				89,391				87,499
Less: Expenses of Principal Activities Segment		51,974				51,195				38,659				156,938				116,214
Fee and Yield Segment EBITDA (2)		198,146				218,478				160,400				633,356				513,523
Plus: Realized Performance Income (Loss), net		245,807				155,375				194,977				521,005				440,258
Plus: Net Realized Gains (Losses)		76,053				7,180				170,078				162,684				370,594
Total Segment EBITDA (2)		$	520,006			$	381,033			$	525,455			$	1,317,045			$	1,324,375
Core Interest Expense
GAAP Interest Expense		$	211,959			$	198,590			$	255,105			$	597,403			$	607,812
Less: Interest expense related to debt obligations of consolidated investment funds, CLOs and other		166,346				151,564				207,599				463,055				463,315
Segment Interest Expense		45,613				47,026				47,506				134,348				144,497
Less: Interest Expense related to debt obligations from KFN and other		16,026				16,384				18,500				44,957				56,998
Core Interest Expense (3)		$	29,587			$	30,642			$	29,006			$	89,391			$	87,499

⁽¹⁾ Fee related earnings (“FRE”) is a measure of the operating earnings of KKR and its business segments before performance income, related performance income compensation and investment income. KKR believes this measure is useful to unitholders as it provides additional insight into the operating profitability of KKR's fee generating management companies and capital markets businesses.

⁽²⁾ Fee and Yield Segment EBITDA and Total Segment EBITDA may be useful in evaluating KKR's ability to service its debt. Fee and Yield Segment EBITDA provides insight into the amount of KKR’s distributable earnings before the impact of interest expense, significant portions of which tend to be more recurring than realized performance income and realized investment income from quarter to quarter. Total Segment EBITDA represents Fee and Yield Segment EBITDA plus the addition of realized performance income and realized investment income.

⁽³⁾ Core interest expense is used by management as an alternative measurement of interest expense incurred by KKR on a segment basis and excludes interest expense related to debt obligations from investment financing arrangements related to certain of KKR’s investment funds, investment vehicles and principal investments and also excludes interest expense incurred by KFN. The financing arrangements excluded from core interest expense are not direct obligations of the general partners of KKR’s private equity funds or its management companies, and in the case of debt obligations of KFN are non-recourse to KKR beyond the assets of KFN. KKR believes this measure is useful to unitholders as it provides an indication of the amount of interest expense borne by KKR excluding interest expense that is allocated to KKR’s investment funds, other noncontrolling interest holders and KFN. Additionally, we believe this measure is useful for analyzing KKR’s ability to service its debt obligations other than the debt obligations of KFN.

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KKR
EXHIBIT B
KKR'S PORTION OF TOTAL UNCALLED COMMITMENTS TO ITS INVESTMENT FUNDS (UNAUDITED)
(Amounts in thousands)
	Uncalled Commitments
Private Markets
Americas Fund XII	$	975,000
Asian Fund III	500,000
Health Care Strategic Growth Fund	150,000
Real Estate Partners Americas II	150,000
Next Generation Technology Growth Fund	97,100
Energy Income and Growth	86,400
European Fund IV	79,800
Global Infrastructure Investors II	74,200
Real Estate Partners Europe	58,300
Real Estate Credit Opportunity Partners	45,000
Other Private Markets Vehicles	332,500
Total Private Markets Commitments	2,548,300
Public Markets
Special Situations Fund II	173,700
Lending Partners Europe	26,700
Lending Partners III	24,700
Other Public Markets Vehicles	164,000
Total Public Markets Commitments	389,100
Total Uncalled Commitments	$	2,937,400

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KKR
EXHIBIT C
RECONCILIATION OF NET INCOME (LOSS) ATTRIBUTABLE TO KKR & CO. L.P. PER COMMON UNIT - BASIC (GAAP BASIS)
TO AFTER TAX ENI PER ADJUSTED UNIT (UNAUDITED)
(Amounts in thousands, except common unit and per common unit amounts)
		Quarter Ended
		September 30, 2017				June 30, 2017				September 30, 2016
Net income (loss) attributable to KKR & Co. L.P. per common unit - Basic		$	0.33			$	0.87			$	0.79
Weighted Average Common Units Outstanding - Basic		471,758,886				466,170,025				445,989,300
Net Income (Loss) Attributable to KKR & Co. L.P. Common Unitholders		153,563				405,646				352,152
Plus: Preferred Distributions		8,341				8,341				8,201
Plus: Net income (loss) attributable to noncontrolling interests held by KKR Holdings L.P.		115,434				305,280				284,834
Plus: Non-cash equity-based charges		78,728				87,940				61,552
Plus: Amortization of intangibles, placement fees and other, net		20,464				4,524				(48,299		)
Plus: Income tax (benefit)		18,420				18,538				10,826
Economic Net Income (Loss)		394,950				830,269				669,266
Less: Equity-based compensation associated with the KKR & Co. L.P. 2010 equity incentive plan		54,921				44,976				50,270
Pre-tax Economic Net Income (Loss)		340,029				785,293				618,996
Less: Provision for income tax (benefit)		23,317				24,408				12,611
Less: Preferred Distributions		8,341				8,341				8,201
After-tax Economic Net Income (Loss)		308,371				752,544				598,184
Weighted Average Adjusted Units		848,087,704				847,650,747				837,504,674
After-tax Economic Net Income (Loss) Per Adjusted Unit		$	0.36			$	0.89			$	0.71
		Nine Months Ended
		September 30, 2017				September 30, 2016
Net income (loss) attributable to KKR & Co. L.P. per common unit - Basic		$	1.76			$	0.26
Weighted Average Common Units Outstanding - Basic		463,941,084				448,149,747
Net Income (Loss) Attributable to KKR & Co. L.P. Common Unitholders		818,552				116,103
Plus: Preferred Distributions		25,023				13,894
Plus: Net income (loss) attributable to noncontrolling interests held by KKR Holdings L.P.		637,146				86,659
Plus: Non-cash equity-based charges		277,704				186,032
Plus: Amortization of intangibles, placement fees and other, net		57,825				(10,273		)
Plus: Income tax (benefit)		77,500				18,761
Economic Net Income (Loss)		1,893,750				411,176
Less: Equity-based compensation associated with the KKR & Co. L.P. 2010 equity incentive plan		149,840				148,257
Pre-tax Economic Net Income (Loss)		1,743,910				262,919
Less: Provision for income tax (benefit)		108,050				12,617
Less: Preferred Distributions		25,023				13,894
After-tax Economic Net Income (Loss)		1,610,837				236,408
Weighted Average Adjusted Units		848,332,124				841,988,454
After-tax Economic Net Income (Loss) Per Adjusted Unit		$	1.90			$	0.28

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KKR
EXHIBIT C (CONTINUED)
RECONCILIATION OF FEES AND OTHER (GAAP BASIS) TO TOTAL SEGMENT REVENUES AND TOTAL DISTRIBUTABLE SEGMENT REVENUES (UNAUDITED)
(Amounts in thousands)
		Quarter Ended
		September 30, 2017				June 30, 2017				September 30, 2016
Fees and Other		$	692,877			$	931,788			$	687,056
Plus: Management fees relating to consolidated funds and placement fees		54,012				52,300				49,017
Less: Fee credits relating to consolidated funds		106				2,707				417
Plus: Net realized and unrealized carried interest - consolidated funds		22,341				10,384				5,956
Plus: Total investment income (loss)		50,095				335,967				330,497
Less: Revenue earned by oil & gas producing entities		12,441				17,382				16,191
Less: Reimbursable expenses		27,506				36,076				12,064
Less: Other		9,587				9,136				12,317
Total Segment Revenues		$	769,685			$	1,265,138			$	1,031,537
Less: Unrealized Carried Interest		(59,638		)		296,719				70,351
Less: Net Unrealized Gains (Losses)		(50,902		)		307,977				136,740
Total Distributable Segment Revenues		$	880,225			$	660,442			$	824,446
		Nine Months Ended
		September 30, 2017				September 30, 2016
Fees and Other		$	2,340,617			$	1,426,618
Plus: Management fees relating to consolidated funds and placement fees		153,414				131,335
Less: Fee credits relating to consolidated funds		3,752				2,766
Plus: Net realized and unrealized carried interest - consolidated funds		43,782				15,581
Plus: Total investment income (loss)		684,722				(245,846		)
Less: Revenue earned by oil & gas producing entities		47,096				47,977
Less: Reimbursable expenses		87,131				46,583
Less: Other		27,035				29,453
Total Segment Revenues		$	3,057,521			$	1,200,909
Less: Unrealized Carried Interest		377,707				(134,756		)
Less: Net Unrealized Gains (Losses)		461,111				(725,699		)
Total Distributable Segment Revenues		$	2,218,703			$	2,061,364

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KKR
EXHIBIT C (CONTINUED)
RECONCILIATION OF TOTAL EXPENSES (GAAP BASIS) TO TOTAL SEGMENT EXPENSES AND TOTAL DISTRIBUTABLE SEGMENT EXPENSES (UNAUDITED)
(Amounts in thousands)
		Quarter Ended
		September 30, 2017				June 30, 2017				September 30, 2016
Total Expenses		$	530,247			$	629,728			$	511,117
Less: Equity based compensation		72,250				87,940				61,552
Less: Reimbursable expenses and placement fees		37,508				58,860				18,255
Less: Operating expenses relating to consolidated funds, CFEs and other entities		21,858				21,229				20,141
Less: Expenses incurred by oil & gas producing entities		10,725				12,924				17,782
Less: Intangible amortization		2,473				5,062				22,112
Less: Other		11,744				10,024				9,764
Total Segment Expenses		$	373,689			$	433,689			$	361,511
Less: Unrealized Performance Income Compensation		(19,826		)		119,774				29,393
Total Distributable Segment Expenses		$	393,515			$	313,915			$	332,118
		Nine Months Ended
		September 30, 2017				September 30, 2016
Total Expenses		$	1,699,989			$	1,242,658
Less: Equity based compensation		271,226				186,032
Less: Reimbursable expenses and placement fees		132,491				72,887
Less: Operating expenses relating to consolidated funds, CFEs and other entities		56,517				85,093
Less: Expenses incurred by oil & gas producing entities		34,826				56,000
Less: Intangible amortization		13,901				35,640
Less: Other		31,067				19,275
Total Segment Expenses		$	1,159,961			$	787,731
Less: Unrealized Performance Income Compensation		157,162				(48,724		)
Total Distributable Segment Expenses		$	1,002,799			$	836,455

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KKR
EXHIBIT C (CONTINUED)
RECONCILIATION OF NET INCOME (LOSS) ATTRIBUTABLE TO KKR & CO. L.P. COMMON UNITHOLDERS (GAAP BASIS)
TO ECONOMIC NET INCOME (LOSS), FEE RELATED EARNINGS, FEE AND YIELD SEGMENT EBITDA, AFTER TAX DISTRIBUTABLE EARNINGS AND TOTAL SEGMENT EBITDA (UNAUDITED)
(Amounts in thousands)
		Quarter Ended
		September 30, 2017				June 30, 2017				September 30, 2016
Net Income (Loss) Attributable to KKR & Co. L.P. Common Unitholders		$	153,563			$	405,646			$	352,152
Plus: Preferred Distributions		8,341				8,341				8,201
Plus: Net income (loss) attributable to noncontrolling interests held by KKR Holdings L.P.		115,434				305,280				284,834
Plus: Non-cash equity-based charges		78,728				87,940				61,552
Plus: Amortization of intangibles, placement fees and other, net		20,464				4,524				(48,299		)
Plus: Income tax (benefit)		18,420				18,538				10,826
Economic Net Income (Loss)		394,950				830,269				669,266
Plus: Income attributable to segment noncontrolling interests		1,046				1,180				760
Less: Total investment income (loss)		50,095				335,967				330,497
Less: Net performance income (loss)		205,995				332,320				235,935
Plus: Expenses of Principal Activities Segment		51,974				51,195				38,659
Fee Related Earnings		191,880				214,357				142,253
Plus: Net interest and dividends		24,944				20,810				23,679
Plus: Depreciation and amortization		3,709				3,864				4,121
Plus: Core interest expense		29,587				30,642				29,006
Less: Expenses of Principal Activities Segment		51,974				51,195				38,659
Fee and Yield Segment EBITDA		198,146				218,478				160,400
Less: Depreciation and amortization		3,709				3,864				4,121
Less: Core interest expense		29,587				30,642				29,006
Plus: Realized performance income (loss), net		245,807				155,375				194,977
Plus: Net realized gains (losses)		76,053				7,180				170,078
Less: Income taxes paid		12,869				15,084				21,869
Less: Preferred Distributions		8,341				8,341				8,201
Less: Income attributable to segment noncontrolling interests		1,046				1,180				760
After-tax Distributable Earnings		464,454				321,922				461,498
Plus: Depreciation and amortization		3,709				3,864				4,121
Plus: Core interest expense		29,587				30,642				29,006
Plus: Income taxes paid		12,869				15,084				21,869
Plus: Preferred Distributions		8,341				8,341				8,201
Plus: Income attributable to segment noncontrolling interests		1,046				1,180				760
Total Segment EBITDA		$	520,006			$	381,033			$	525,455
		Nine Months Ended
		September 30, 2017				September 30, 2016
Net Income (Loss) Attributable to KKR & Co. L.P. Common Unitholders		$	818,552			$	116,103
Plus: Preferred Distributions		25,023				13,894
Plus: Net income (loss) attributable to noncontrolling interests held by KKR Holdings L.P.		637,146				86,659
Plus: Non-cash equity-based charges		277,704				186,032
Plus: Amortization of intangibles, placement fees and other, net		57,825				(10,273		)
Plus: Income tax (benefit)		77,500				18,761
Economic Net Income (Loss)		1,893,750				411,176
Plus: Income attributable to segment noncontrolling interests		3,810				2,002
Less: Total investment income (loss)		684,722				(245,846		)
Less: Net performance income (loss)		741,550				354,226
Plus: Expenses of Principal Activities Segment		156,938				116,214
Fee Related Earnings		628,226				421,012
Plus: Net interest and dividends		60,927				109,259
Plus: Depreciation and amortization		11,750				11,967
Plus: Core interest expense		89,391				87,499
Less: Expenses of Principal Activities Segment		156,938				116,214
Fee and Yield Segment EBITDA		633,356				513,523
Less: Depreciation and amortization		11,750				11,967
Less: Core interest expense		89,391				87,499
Plus: Realized performance income (loss), net		521,005				440,258
Plus: Net realized gains (losses)		162,684				370,594
Less: Income taxes paid		54,228				71,191
Less: Preferred Distributions		25,023				13,894
Less: Income attributable to segment noncontrolling interests		3,810				2,002
After-tax Distributable Earnings		1,132,843				1,137,822
Plus: Depreciation and amortization		11,750				11,967
Plus: Core interest expense		89,391				87,499
Plus: Income taxes paid		54,228				71,191
Plus: Preferred Distributions		25,023				13,894
Plus: Income attributable to segment noncontrolling interests		3,810				2,002
Total Segment EBITDA		$	1,317,045			$	1,324,375

Page 23

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KKR
EXHIBIT C (CONTINUED)
RECONCILIATION OF CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (GAAP BASIS)
TO TOTAL REPORTABLE SEGMENTS BALANCE SHEET (UNAUDITED)
September 30, 2017
(Amounts in thousands)
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (GAAP BASIS)					1			2			3			4			5			TOTAL REPORTABLE SEGMENTS BALANCE SHEET
Assets
Cash and Cash Equivalents	$	2,436,566			—			—			1,187,207			—			—			$	3,623,773		Cash and Short-term Investments
Investments	37,251,837				(26,522,559	)		(1,131,071	)		(1,474,693	)		—			—			8,123,514			Investments
					—			—			1,474,693			—			—			1,474,693			Unrealized Carry
Other Assets	4,617,236				(1,002,082	)		—			(1,348,432	)		—			(301,928	)		1,964,794			Other Assets
					—			—			161,225			—			—			161,225			Corporate Real Estate
Total Assets	$	44,305,639			(27,524,641	)		(1,131,071	)		—			—			(301,928	)		$	15,347,999
Liabilities and Equity
Debt Obligations	20,290,714				(17,650,947	)		—			(639,767	)		—			—			2,000,000			Debt Obligations - KKR (ex-KFN)
					—			—			639,767			—			—			639,767			Debt Obligations - KFN
					—			—			373,750			—			—			373,750			Preferred Shares - KFN
Other Liabilities	4,149,491				(2,245,511	)		(1,131,071	)		—			—			(176,830	)		596,079			Other Liabilities
Total Liabilities	24,440,205				(19,896,458	)		(1,131,071	)		373,750			—			(176,830	)		3,609,596
Redeemable Noncontrolling Interests	570,134				(570,134	)		—			—			—			—
Equity
Series A Preferred Units	332,988				—			—			(332,988	)		—			—
Series B Preferred Units	149,566				—			—			(149,566	)		—			—
KKR & Co. L.P. Capital - Common Unitholders	6,380,654				166,480			—			(17,446	)		4,812,964			(125,098	)		11,217,554			Book Value
Noncontrolling Interests	12,432,092				(7,224,529	)		—			(373,750	)		(4,812,964	)		—			20,849			Noncontrolling Interests
					—			—			500,000			—			—			500,000			Preferred Units
Total Liabilities and Equity	$	44,305,639			(27,524,641	)		(1,131,071	)		—			—			(301,928	)		$	15,347,999
1	IMPACT OF CONSOLIDATION OF INVESTMENT VEHICLES AND OTHER ENTITIES
2	CARRY POOL RECLASSIFICATION
3	OTHER RECLASSIFICATIONS
4	NONCONTROLLING INTERESTS HELD BY KKR HOLDINGS L.P. AND OTHER
5	EQUITY IMPACT OF KKR MANAGEMENT HOLDINGS CORP.

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KKR
EXHIBIT C (CONTINUED)
RECONCILIATION OF CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (GAAP BASIS)
TO TOTAL REPORTABLE SEGMENTS BALANCE SHEET (UNAUDITED)
DECEMBER 31, 2016
(Amounts in thousands)
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (GAAP BASIS)					1			2			3			4			5			TOTAL REPORTABLE SEGMENTS BALANCE SHEET
Assets
Cash and Cash Equivalents	$	2,508,902			—			—			878,771			—			—			$	3,387,673		Cash and Short-term Investments
Investments	31,409,765				(22,249,206	)		(987,994	)		(1,213,692	)		—			—			6,958,873			Investments
					—			—			1,213,692			—			—			1,213,692			Unrealized Carry
Other Assets	5,084,230				(2,118,364	)		—			(1,039,996	)		—			(314,192	)		1,611,678			Other Assets
					—			—			161,225			—			—			161,225			Corporate Real Estate
Total Assets	$	39,002,897			(24,367,570	)		(987,994	)		—			—			(314,192	)		$	13,333,141
Liabilities and Equity
Debt Obligations	18,544,075				(16,145,515	)		—			(398,560	)		—			—			2,000,000			Debt Obligations - KKR (ex-KFN)
					—			—			398,560			—			—			398,560			Debt Obligations - KFN
					—			—			373,750			—			—			373,750			Preferred Shares - KFN
Other Liabilities	3,340,739				(1,945,039	)		(987,994	)		—			—			(163,030	)		244,676			Other Liabilities
Total Liabilities	21,884,814				(18,090,554	)		(987,994	)		373,750			—			(163,030	)		3,016,986
Redeemable Noncontrolling Interests	632,348				(632,348	)		—			—			—			—
Equity
Series A Preferred Units	332,988				—			—			(332,988	)		—			—
Series B Preferred Units	149,566				—			—			(149,566	)		—			—
KKR & Co. L.P. Capital - Common Unitholders	5,457,279				118,635			—			(17,446	)		4,389,285			(151,162	)		9,796,591			Book Value
Noncontrolling Interests	10,545,902				(5,763,303	)		—			(373,750	)		(4,389,285	)		—			19,564			Noncontrolling Interests
					—			—			500,000			—			—			500,000			Preferred Units
Total Liabilities and Equity	$	39,002,897			(24,367,570	)		(987,994	)		—			—			(314,192	)		$	13,333,141
1	IMPACT OF CONSOLIDATION OF INVESTMENT VEHICLES AND OTHER ENTITIES
2	CARRY POOL RECLASSIFICATION
3	OTHER RECLASSIFICATIONS
4	NONCONTROLLING INTERESTS HELD BY KKR HOLDINGS L.P. AND OTHER
5	EQUITY IMPACT OF KKR MANAGEMENT HOLDINGS CORP.

Page 25

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KKR
EXHIBIT D
RECONCILIATION OF WEIGHTED AVERAGE GAAP COMMON UNITS OUTSTANDING (UNAUDITED)
The following table provides a reconciliation of KKR's Weighted Average GAAP Common Units Outstanding to Weighted Average Adjusted Units:
		Quarter Ended
		September 30, 2017			June 30, 2017			September 30, 2016
Weighted Average GAAP Common Units Outstanding - Basic		471,758,886			466,170,025			445,989,300
Adjustments:
Weighted Average Unvested Common Units and Other Securities (1)		35,114,291			35,007,398			33,986,375
Weighted Average GAAP Common Units Outstanding - Diluted		506,873,177			501,177,423			479,975,675
Adjustments:
Weighted Average KKR Holdings Units (2)		341,214,527			346,473,324			357,528,999
Weighted Average Adjusted Units		848,087,704			847,650,747			837,504,674
		Nine Months Ended
		September 30, 2017			September 30, 2016
Weighted Average GAAP Common Units Outstanding - Basic		463,941,084			448,149,747
Adjustments:
Weighted Average Unvested Common Units and Other Securities (1)		37,674,551			34,985,238
Weighted Average GAAP Common Units Outstanding - Diluted		501,615,635			483,134,985
Adjustments:
Weighted Average KKR Holdings Units (2)		346,716,489			358,853,469
Weighted Average Adjusted Units		848,332,124			841,988,454
RECONCILIATION OF GAAP COMMON UNITS OUTSTANDING (UNAUDITED)
The following table provides a reconciliation of KKR's GAAP Common Units Outstanding to Adjusted Units, Adjusted Units Eligible for Distribution and Outstanding Adjusted Units:
		As of
		September 30, 2017			December 31, 2016
GAAP Common Units Outstanding - Basic		473,134,387			452,380,335
Unvested Common Units and Other Securities (1)		35,104,599			42,119,756
GAAP Common Units Outstanding - Diluted		508,238,986			494,500,091
Adjustments:
KKR Holdings Units (2)		339,845,707			353,757,398
Adjusted Units		848,084,693			848,257,489
Adjustments:
Unvested Common Units		(31,116,886	)		(37,519,436	)
Adjusted Units Eligible for Distribution		816,967,807			810,738,053
Adjustments:
Vested Other Securities		(3,987,713	)		(4,600,320	)
Outstanding Adjusted Units		812,980,094			806,137,733

⁽¹⁾ Represents unvested equity awards granted under the Equity Incentive Plan and other securities that are exchangeable into KKR & Co. L.P common units. The issuance of common units of KKR & Co. L.P. pursuant to such equity awards or other securities dilutes KKR common unitholders and KKR Holdings pro rata in accordance with their respective percentage interests in the KKR business.

⁽²⁾ Common units that may be issued by KKR & Co. L.P. upon exchange of units in KKR Holdings L.P. for KKR common units.

Page 26