(Reuters) – Apollo Global Management Inc announced Tuesday that distributable earnings rose 78% in the first quarter, driven by rising management fees from its sprawling lending business and an increase in asset sales from its private equity portfolio .
FILE PHOTO: Marc Rowan, Co-Founder and Senior Managing Director of Apollo Global Management, LLC, Attends a Panel Discussion on Credit Markets: What’s Next? during the 2014 Milken Institute Global Conference in Beverly Hills, Calif., April 29, 2014. REUTERS / Kevork Djansezian
This was the first quarterly result reported by Apollo with co-founder Marc Rowan at the helm as managing director. He succeeded Leon Black, who left the New York-based firm in March after the Dechert law firm reviewed his ties to the late financier and convicted sex offender Jeffrey Epstein.
The review found that Black paid Epstein $ 158 million for advice on tax and estate planning and related services between 2012 and 2017. This freed Black from any wrongdoing.
Apollo announced Tuesday that its first quarter distributable earnings – cash used to pay dividends to shareholders – increased from $ 165.1 million a year ago to $ 293.8 million. This resulted in distributable earnings per share of 66 cents per share, which is above the 58 cents estimated by Wall Street analysts, according to financial data provider Refinitiv.
Apollo Peer Blackstone Group Inc reported last month that distributable income more than doubled in the first quarter, while Carlyle Group Inc said distributable income after tax increased 23% due to strong sales of assets from the private equity business is. [L1N2MF0ZX] [L1N2MM1QE]
Apollo announced it had sold $ 3.7 billion in assets in the first quarter. The company has given up its entire stake in the luxury watch retailer Watches of Switzerland and the US subprime lender OneMain Holdings Inc. and sold a 9% stake in the French glass bottle manufacturer Verallia.
The company has also put a lot of capital into the work. Approximately $ 24.9 billion was made available in the quarter, of which $ 19.1 billion will be credited to investments.
In March, Apollo entered into an all-stock merger deal with Athene Holdings Ltd that would involve internally the pension provider, which makes a significant contribution to income from lucrative asset management fees. [L4N2L62U8]
Apollo said fee-based profit rose 26% to a record $ 286.7 million, driven by heavy management, advisory, and transaction fees. It reported net income of $ 669.7 million using generally accepted accounting principles (GAAP), also a record.
According to Apollo, the private equity portfolio grew 22% for the quarter, while real estate, home finance and infrastructure funds rose 12%. The loan funds increased by 4% overall.
Total asset management increased to $ 461.1 billion from $ 455.5 billion in the previous quarter, driven by fundraising and the appreciation of the private equity portfolio. Apollo, which ended the quarter with $ 49.7 billion in unsuspended capital, declared a dividend of 50 cents per share.
Earlier this month, Apollo agreed to buy the media unit of Verizon Communications Inc, which owns Yahoo and AOL, for $ 5 billion.
Reporting by Chibuike Oguh in New York; Adaptation by Jacqueline Wong