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Apollo Global's Q4 earnings jump 31% on management fees, annuities

By Reuters

  • 09 Feb 2024
Apollo Global's Q4 earnings jump 31% on management fees, annuities
Marc Rowan, CEO, Apollo Global Management, in a 2014 photo. | Credit: Reuters/Kevork Djansezian

Apollo Global Management said on Thursday its fourth-quarter adjusted net income jumped nearly 31%, driven by growth in management fees and earnings from its retirement services business.

Apollo's adjusted net income rose to $1.2 billion, up from $903 million a year earlier. That resulted in adjusted net income per share of $1.91, higher than the average estimate of $1.72 from Wall Street analysts, according to LSEG data.

Fee-related earnings rose 16% to a quarterly record of $457 million, buoyed by rising income from management fees despite a
drop in revenue from Apollo's capital markets business.

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Spread-related earnings, which Apollo generates by investing the capital of its annuities business Athene, rose 7.2% to $748
million, helped by higher interest rates and stronger inflows from new annuities underwritten.

Net profit from asset sales rose nearly 89% to $51 million as divestments across Apollo's private equity portfolio picked up even though it remained "prudently delayed" given a "challenging environment" to cash out investments, the firm said.

Apollo's private equity funds appreciated by 2.5% in the fourth quarter, while its corporate credit funds rose 3.2% and debt and equity funds gained 3.6%.

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On Wednesday, Carlyle Group Inc's reported that the value of its private equity funds appreciated by 2%. Blackstone Inc's corporate private equity funds gained by 3.5%, while that of KKR & Co Inc rose 3%. Apollo's net income under generally accepted accounting principles (GAAP) soared to $2.9 billion, up from $640 million a year earlier, driven by investment-related gains and increased premium inflows from Athene.

Apollo originated $30 billion worth of investment-grade debt in the reported quarter, retained $58 billion of unspent capital, and amassed $651 billion in total assets under management. It declared a dividend of 43 cents per share.

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