DigitalBridge Group, Inc. [DBRG] Filings

10-Q 1 dbrg-20220630.htm 10-Q dbrg-20220630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2022


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number: 001-37980

DigitalBridge Group, Inc.

(Exact Name of Registrant as Specified in Its Charter)

Maryland

46-4591526

(State or Other Jurisdiction of

Incorporation or Organization)

(I.R.S. Employer

Identification No.)

750 Park of Commerce Drive, Suite 210

Boca Raton, Florida 33487

(Address of Principal Executive Offices, Including Zip Code)

(561) 570-4644

(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

Title of Class

Trading Symbol(s)

Name of Each Exchange on Which Registered

Class A Common Stock, $0.01 par value

DBRG

New York Stock Exchange

Preferred Stock, 7.125% Series H Cumulative Redeemable, $0.01 par value

DBRG.PRH

New York Stock Exchange

Preferred Stock, 7.15% Series I Cumulative Redeemable, $0.01 par value

DBRG.PRI

New York Stock Exchange

Preferred Stock, 7.125% Series J Cumulative Redeemable, $0.01 par value

DBRG.PRJ

New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Table of Contents

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer

☒

Accelerated Filer

☐

Non-Accelerated Filer

☐

Smaller Reporting Company

☐

Emerging Growth Company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards pursuant to Section 13(a) of the Exchange Act. Yes ☐ No ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of August 1, 2022, 655,593,800 shares of the Registrant's class A common stock and 665,978 shares of class B common stock were outstanding.

Table of Contents

DigitalBridge Group, Inc.

Form 10-Q

Table of Contents


	PART I. FINANCIAL INFORMATION	Page
Item 1.	Financial Statements	4
	Consolidated Balance Sheets	4
	Consolidated Statements of Operations	5
	Consolidated Statements of Comprehensive Income (Loss)	6
	Consolidated Statements of Equity	7
	Consolidated Statements of Cash Flows	9
	Notes to Consolidated Financial Statements:	11
	1. Business and Organization	11
	2. Summary of Significant Accounting Policies	12
	3. Acquisitions	15
	4. Real Estate	17
	5. Equity Investments	18
	6. Goodwill, Deferred Leasing Costs and Other Intangibles	20
	7. Restricted Cash, Other Assets and Other Liabilities	21
	8. Debt	22
	9. Stockholders' Equity	26
	10. Noncontrolling Interests	29
	11. Assets and Related Liabilities Held for Disposition	31
	12. Discontinued Operations	33
	13. Fair Value	34
	14. Variable Interest Entities	38
	15. Earnings per Share	40
	16. Fee Income	41
	17. Equity-Based Compensation	41
	18. Transactions with Affiliates	44
	19. Segment Reporting	45
	20. Commitments and Contingencies	48
	21. Supplemental Disclosure of Cash Flow Information	49
	22. Subsequent Events	49
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	51
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	72
Item 4.	Controls and Procedures	74
	PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	75
Item 1A.	Risk Factors	75
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	75
Item 3.	Defaults Upon Senior Securities	75
Item 4.	Mine Safety Disclosures	75
Item 5.	Other Information	75
Item 6.	Exhibits	75
SIGNATURES		77

Table of Contents

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

DigitalBridge Group, Inc.

Consolidated Balance Sheets

(In thousands, except per share data)


	June 30, 2022 (Unaudited)		December 31, 2021
Assets
Cash and cash equivalents	$	337,150	$	1,602,102
Restricted cash	108,686		99,121
Real estate, net	6,047,928		4,972,284
Loans receivable (at fair value)	514,163		173,921
Equity investments ($202,514 and $201,912 at fair value)	1,080,261		935,153
Goodwill	761,368		761,368
Deferred leasing costs and intangible assets, net	1,827,960		1,187,627
Assets held for disposition	156,672		3,676,615
Other assets ($28,837 and $944 at fair value)	991,382		740,395
Due from affiliates	51,718		49,230
Total assets	$	11,877,288	$	14,197,816
Liabilities
Debt, net	$	5,539,732	$	4,860,402
Accrued and other liabilities ($186,614 and $0 at fair value)	1,624,708		928,042
Intangible liabilities, net	32,840		33,301
Liabilities related to assets held for disposition	719		3,088,699

Dividends and distributions payable	15,759		15,759

Total liabilities	7,213,758		8,926,203
Commitments and contingencies (Note 20)
Redeemable noncontrolling interests	102,011		359,223
Equity
Stockholders’ equity:
Preferred stock, $0.01 par value per share; $883,500 liquidation preference; 250,000 shares authorized; 35,340 shares issued and outstanding	854,232		854,232
Common stock, $0.01 par value per share
Class A, 949,000 shares authorized; 655,750 and 568,577 shares issued and outstanding	6,557		5,685
Class B, 1,000 shares authorized; 666 shares issued and outstanding	7		7
Additional paid-in capital	7,646,852		7,820,807
Accumulated deficit	(6,875,817)		(6,576,180)
Accumulated other comprehensive income	1,455		42,383
Total stockholders’ equity	1,633,286		2,146,934
Noncontrolling interests in investment entities	2,870,528		2,653,173
Noncontrolling interests in Operating Company	57,705		112,283
Total equity	4,561,519		4,912,390
Total liabilities, redeemable noncontrolling interests and equity	$	11,877,288	$	14,197,816

The accompanying notes are an integral part of the consolidated financial statements.

Table of Contents

DigitalBridge Group, Inc.

Consolidated Statements of Operations

(In thousands, except per share data)

(Unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Revenues
Property operating income	$	234,251	$	188,985	$	436,762	$	377,987
Interest income	8,499		1,319		13,665		2,173
Fee income ($43,403, $41,141, $85,407 and $70,398 from affiliates)	44,318		45,157		87,155		74,600
Other income ($788, $908, $4,698 and $1,427 from affiliates)	2,341		1,726		9,286		3,008
Total revenues	289,409		237,187		546,868		457,768
Expenses
Property operating expense	97,290		77,140		181,293		157,002
Interest expense	46,388		37,938		90,418		77,718
Investment expense	7,187		5,871		16,752		12,764
Transaction-related costs	2,756		64		2,921		1,682
Depreciation and amortization	155,352		138,229		283,919		277,654


Compensation expense—cash and equity-based	52,792		48,199		118,334		126,985
Compensation expense—incentive fee and carried interest	49,069		8,266		28,717		8,233
Administrative expenses	26,353		28,505		54,238		46,301

Total expenses	437,187		344,212		776,592		708,339
Other income (loss)

Other loss, net	(46,256)		(27,041)		(196,137)		(36,391)
Equity method earnings	27,427		51,481		46,634		35,064
Equity method earnings—carried interest	110,779		11,169		79,700		10,947
Loss from continuing operations before income taxes	(55,828)		(71,416)		(299,527)		(240,951)
Income tax benefit	2,518		75,239		9,931		98,435
Income (loss) from continuing operations	(53,310)		3,823		(289,596)		(142,516)
Loss from discontinued operations	(14,771)		(98,906)		(122,169)		(580,166)
Net loss	(68,081)		(95,083)		(411,765)		(722,682)
Net income (loss) attributable to noncontrolling interests:
Redeemable noncontrolling interests	(14,327)		6,025		(25,547)		8,474
Investment entities	(29,102)		36,616		(92,147)		(319,246)
Operating Company	(3,090)		(14,980)		(25,952)		(42,876)
Net loss attributable to DigitalBridge Group, Inc.	(21,562)		(122,744)		(268,119)		(369,034)

Preferred stock dividends	15,759		18,516		31,518		37,032
Net loss attributable to common stockholders	$	(37,321)	$	(141,260)	$	(299,637)	$	(406,066)
Loss per share—basic
Loss from continuing operations per common share—basic	$	(0.04)	$	(0.02)	$	(0.33)	$	(0.24)
Net loss attributable to common stockholders per common share—basic	$	(0.06)	$	(0.29)	$	(0.51)	$	(0.85)
Loss per share—diluted
Loss from continuing operations per common share—diluted	$	(0.04)	$	(0.02)	$	(0.33)	$	(0.24)
Net loss attributable to common stockholders per common share—diluted	$	(0.06)	$	(0.29)	$	(0.51)	$	(0.85)
Weighted average number of shares
Basic	615,932		479,643		593,063		477,284
Diluted	615,932		479,643		593,063		477,284

The accompanying notes are an integral part of the consolidated financial statements.

Table of Contents

DigitalBridge Group, Inc.

Consolidated Statements of Comprehensive Income (Loss)

(In thousands)

(Unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Net loss	$	(68,081)	$	(95,083)	$	(411,765)	$	(722,682)
Changes in accumulated other comprehensive income (loss) related to:
Equity method investments	(2,688)		521		(2,686)		(2,187)
Available-for-sale debt securities	—		1,363		(6,373)		(1,946)
Cash flow hedges	—		—		—		1,285
Foreign currency translation	(24,340)		(17,185)		(62,281)		(76,803)
Net investment hedges	6,984		(4,202)		6,984		(84)
Other comprehensive loss	(20,044)		(19,503)		(64,356)		(79,735)
Comprehensive loss	(88,125)		(114,586)		(476,121)		(802,417)
Comprehensive income (loss) attributable to noncontrolling interests:
Redeemable noncontrolling interests	(14,327)		6,025		(25,547)		8,474
Investment entities	(36,874)		36,038		(111,930)		(356,480)
Operating Company	(4,016)		(16,605)		(29,474)		(46,934)
Comprehensive loss attributable to stockholders	$	(32,908)	$	(140,044)	$	(309,170)	$	(407,477)

The accompanying notes are an integral part of the consolidated financial statements.

Table of Contents

DigitalBridge Group, Inc.

Consolidated Statements of Equity

(In thousands, except per share data)

(Unaudited)


	Preferred Stock		Common Stock		Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Income (Loss)		Total Stockholders’ Equity		Noncontrolling Interests in Investment Entities		Noncontrolling Interests in Operating Company		Total Equity























Balance at December 31, 2020	$	999,490	$	4,841	$	7,570,473	$	(6,195,456)	$	122,123	$	2,501,471	$	4,327,372	$	155,747	$	6,984,590

Net loss	—		—		—		(246,290)		—		(246,290)		(355,862)		(27,896)		(630,048)
Other comprehensive loss	—		—		—		—		(21,143)		(21,143)		(36,656)		(2,433)		(60,232)

Deconsolidation of investment entities (Note 21)	—		—		—		—		—		—		(22,413)		—		(22,413)
Redemption of OP Units for class A common stock	—		—		16		—		—		16		—		(16)		—
Equity awards issued, net of forfeitures	—		48		16,536		—		—		16,584		308		1,308		18,200
Shares canceled for tax withholdings on vested equity awards	—		(11)		(7,707)		—		—		(7,718)		—		—		(7,718)
Contributions from noncontrolling interests	—		—		—		—		—		—		113,213		—		113,213
Distributions to noncontrolling interests	—		—		—		—		—		—		(26,739)		—		(26,739)
Preferred stock dividends	—		—		—		(18,516)		—		(18,516)		—		—		(18,516)

Reallocation of equity (Notes 2 and 10)	—		—		(2,445)		—		76		(2,369)		4,682		(2,313)		—
Balance at March 31, 2021	999,490		4,878		7,576,873		(6,460,262)		101,056		2,222,035		4,003,905		124,397		6,350,337
Net loss	—		—		—		(122,744)		—		(122,744)		36,616		(14,980)		(101,108)
Other comprehensive income (loss)	—		—		—		—		(15,818)		(15,818)		7,805		(1,625)		(9,638)
Shares issued pursuant to settlement liability	—		60		46,982		—		—		47,042		—		—		47,042
Deconsolidation of investment entities (Note 21)	—		—		2,028		—		(1,482)		546		(202,887)		—		(202,341)
Redemption of OP Units for class A common stock	—		—		1		—		—		1		—		(1)		—
Equity awards issued, net of forfeitures	—		2		10,194		—		—		10,196		308		1,067		11,571
Shares canceled for tax withholdings on vested equity awards	—		(13)		(9,166)		—		—		(9,179)		—		—		(9,179)
Contributions from noncontrolling interests	—		—		—		—		—		—		24,540		—		24,540
Distributions to noncontrolling interests	—		—		—		—		—		—		(33,678)		—		(33,678)
Preferred stock dividends	—		—		—		(18,516)		—		(18,516)		—		—		(18,516)

Reallocation of equity (Notes 2 and 10))	—		—		(4,530)		—		(81)		(4,611)		—		4,611		—
Balance at June 30, 2021	$	999,490	$	4,927	$

DigitalBridge Group, Inc. [DBRG] Filings
DigitalBridge Group, Inc. [DBRG-PH] Filings
DigitalBridge Group, Inc. [DBRG-PI] Filings
DigitalBridge Group, Inc. [DBRG-PJ] Filings
10-Q	[2022-08-08]
10-Q	[2022-05-09]
10-K	[2022-02-28]
10-Q	[2021-11-09]
10-Q	[2021-08-09]
10-Q	[2021-05-10]
10-K	[2021-03-01]
10-Q	[2020-11-09]
10-Q	[2020-08-10]
10-Q	[2020-05-11]
10-K	[2020-03-02]
10-Q	[2019-11-08]
10-Q	[2019-08-09]
10-Q	[2019-05-10]
10-K	[2019-03-01]
10-Q	[2018-11-09]
10-Q	[2018-08-09]
10-Q	[2018-05-10]
10-K	[2018-03-01]
10-Q	[2017-11-09]
10-Q	[2017-08-09]
10-Q	[2017-05-10]
10-K	[2017-02-28]

DigitalBridge Group, Inc. [DBRG] Filings

DigitalBridge Group, Inc. [DBRG-PH] Filings

DigitalBridge Group, Inc. [DBRG-PI] Filings

DigitalBridge Group, Inc. [DBRG-PJ] Filings