Apollo Global’s Q4 Earnings Rise 52% on Credit Management Fees

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The downtown Manhattan skyline is seen in New York, U.S., August 21, 2021. REUTERS/Andrew Kelly/File Photo

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Feb 11 (Reuters) – Apollo Global Management Inc (APO.N) posted a 52% increase in its fourth-quarter distributable profit on Friday, driven by strong growth in management and advisory fees from its credit business.

The New York-based company said its distributable earnings, or cash used to pay dividends to shareholders, reached $483 million in the three months to December 31, from $317.4 million a year earlier. early.

That translated into distributable earnings per share of $1.05, slightly below analysts’ average estimate of $1.10 per share, according to financial data provider Refinitiv.

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While Apollo capitalized on strong markets in late 2021 to cash in on some of its investments, it did so at a slower pace than its major peers. It generated $4.2 billion in proceeds from exiting positions in the fourth quarter, compared to $8.8 billion in the prior quarter.

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The equity segments of these companies were a major driver of their performance. Apollo, on the other hand, derives most of its revenue from its credit business, where there are three times the assets of its equity divisions.

Apollo said it rolled out $34.6 billion in new investments in the fourth quarter, mostly in its credit division. Its fee-related revenue reached a record $309 million.

Corporate credit and structured credit funds gained 0.9% and 3% respectively, while the private equity portfolio gained 5.2%. Blackstone, Carlyle and KKR reported appreciation in their private equity funds of 4.8%, 6% and 7%, respectively.

Under generally accepted accounting principles (GAAP), net income fell 45% to $234.4 million from $425 million a year earlier, due to lower investment income and a multiplication by nearly its remuneration expenses.

It recorded about $1 billion as a one-time non-cash charge as part of a previously announced plan to replace deferred interest payments to executives with one-time stock awards.

Apollo’s total assets under management rose 3.4% to $497.6 billion, driven by growth in retirement services customers in its Athene franchise and strong fundraising. Its unspent capital stood at $47.2 billion at the end of the quarter.

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Reporting by Chibuike Oguh in New York; Editing by Rashmi Aich

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