Apollo Global Management, Inc. (new) · NYSE:APO
Apollo Global Management, Inc. (new) — Apollo Global Management — Investor Presentation (May 2014)
35 slides from Apollo Global Management, Inc. (new)'s investor presentation, May 19, 2014
Slide 1: Investor Presentation May 2014
Exhibit 99.1 Investor Presentation Confidential – Not for distribution, in whole or in part, without the express written consent of Apollo Global Management, LLC. Information contained herein is as of March 31, 2014 unless otherwise noted May 2014
Slide 2: Legal Disclaimer
Legal Disclaimer This presentation is confidential and may not be distributed, transmitted or otherwise communicated to others, in whole or in part, without the express consent of Apollo Global Management, LLC or any of its affiliates (“Apollo”). This presentation does not constitute an offer to sel
Slide 3: Forward Looking Statements and Other Important Disclosures
Forward Looking Statements and Other Important Disclosures This presentation may contain forward looking statements that are within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements include, but are not limited to, discu
Slide 4: Agenda
Agenda Topic 1) Apollo Overview 2) Segment update 3) Financial Overview 4) Appendix 3
Slide 5: Apollo Global Management Overview
Apollo Global Management Overview Firm Profile Founded: 1990 Private Equity Credit Real Estate AUM: $159bn $48bn AUM $101bn AUM $9bn AUM Employees: 761 Invs. Prof.: 302 Opportunistic buyouts U.S. Performing Credit Residential & Commercial Global offices: Distressed buyouts and Opportunistic Credit G
Slide 6: Apollo's Key Strengths
Apollo’s Key Strengths Large, diversified, and scalable integrated platform spanning several asset classes and geographies Diverse and integrated $159bn of AUM across private equity, credit, real estate, and permanent capital vehicles platform 125+ funds and managedaccounts across multipleasset clas
Slide 7: Apollo's Integrated Business Model
Apollo’s Integrated Business Model Industry Insights Management Relationships Investment Opportunities Credit Development of industry insight Private through: Equity Over 300 current and former portfolio companies Real Strategic relationships with Estate industry executives Significant relationships
Slide 8: Apollo's Expertise – Nine Core Industries
Apollo’s Expertise – Nine Core Industries Financial & Consumer Distribution & Manufacturing Media, Cable Packaging & Satellite & Chemicals Business Commodities & Retail Transportation & Industrial & Leisure Materials Wireless Services Note: The listed companies are a sample of Apollo private equity
Slide 9: Apollo's Private Equity Track Record
Long 5Apollo’s 17.9% 26% 39% 15.8% 7.4% 4.4% Barclays Government/Credit Index IRR Note: 1. 2. 3. 4. 5. 8average Year Represents Data National Cambridge (1) 9.2% 4.5% Track Refer (2) 10 19.3% 14.0% as IRR ofPrivate S&P Gross Year of the 8.6% 5.7% Council Record to(1) December returns Associates 18.9%
Slide 10: Strong U.S. Credit Performance
Strong U.S. Credit 11.3% 27.3% Fund Opportunistic Weighted Debt 11.4% European AIE Net 16.8% Apollo Europe Note: 1. 2. 3. is 4. 95. no Weighted Since Net Fund IRR II(3,4) Performing longer Portfolio IAs IRR Opportunity 15.9% Fund Credit Investment IIis inception Since of Average Principal Credit den
Slide 11: Significant AUM Growth and Diversification
Significant Apollo’s Private ($ Total 1990-2002: $8.8 $2.3 $113.4 $8.9 $1.1 $159.3 PE $67.6 $40.9 $53.6 $6.5 $10.5 $19.1 $21.2 $$2.5 $8.2 2002 1. 2014 10 11.3 AUM inOnly $4.4 $9.7 $9.2 billions) AUM: 2003 $8.0 $44.2 $15.1 $24.6 $30.3 Equity as AUM $75.2 $48.1 $1.6 $9.8 $64.4 2004 of Growth $101.2 $2
Slide 12: Multi-Strategy Assets Under Management
Multi-Strategy Assets $159 AUM U.S. Private 15% Structured 30% Opportunistic 8% Non-Performing 5% 3% 2% Athene Middle 31% European 6% South 7% Canada 11% United 1% Africa Asia Note: 14% 1. 11 Represents 6% Performing /billion Data America Australia by Under States Equity (non-subadvised) East Strate
Slide 13: Apollo Has a Clear Path for Continued Growth
Apollo Has a Clear Path for Continued Growth Apollo will continue to identify opportunities to leverage its existing platform and diversify into areas with meaningful synergies with its core business Favorable Secular Trends Growth Strategies Selected Examples Investors continue to increase Athene a
Slide 14: Agenda
Agenda Topic 1) Apollo Overview 2) Segment update 3) Financial Overview 4) Appendix 13
Slide 15: Private Equity $48.1bn – Highlights
Private $48.1bn –Highlights(1) Historical S&P 9.2% 13.6% 20.1% 26% Quartile 20 Recent Pace $3.3bn ($bn) $3.4 2010 $2.6 1. 2. between 3. 14 $34.2bn Current Fund More As Cambridge Refer Year $3.2 500 of 2011 of $3.9 average Portfolio VII Equity than Capital March to in PE(3) Top Index(3) flagship Retu
Slide 16: Significant Outperformance During Downturns
Significant Outperformance During Downturns 3Q07 – 2Q 2011 $15.5bn invested 1990 - 1993 $3.4bn invested 2001 - 3Q03 $1.6bn invested 1. Represents net IRR for respective Apollo private equity fund as of March 31, 2014. Past performance not indicative of future results; please refer to slide 2 for the
Slide 17: Fund VIII Capital Raise Summary
Fund 77% vintage New Capital Key LP Cross-selling –Leveraging 16 Approximately Launched Fund Investors Nearly trend Trends of Investor VIII VIII, VIII Raised Fund towards 25% Closing which representing Apollo’s the resonated VIII’s the Capital of from fund Fund Apollo 7% consolidating held Summary c
Slide 18: Credit $101.2bn – Highlights
$101.2bn –Highlights Leverage Significant 2004 $1.6 $101.2 Diversified 3% $3.1bn European Performing NPLs $5.5bn 5% $7.6bn Opportunistic 8% Credit 49% $49.4bn $2.1bn $2.9 ($bn) 2010 $0.8 $1.8 Note: 1. 17 $88.4bn Asub-advised) U.S. 23% “Drawdown $2.8 –As Q1 2011 Credit Business ‘Drawdown Athene Q1 $2
Slide 19: Athene: Differentiated & Strategically Important Growth Driver
Athene: Differentiated & Strategically Important Growth Driver Services Assets Liabilities Assets Athene Asset Management, L.P. (AAM) is a subsidiary of Athene Holding Ltd. (“Athene”) is an insurance holding company Apollo and is included within the Credit segment focused on fixed annuities with app
Slide 20: Real Estate $8.9bn – Highlights
$8.9bn Highlights $5.9bn Global Value-oriented Originates Manages Apollo’s Real 41% Equity Total 59% Income Select Mezzanine Hospitality Single Non-performing Condominium CMBS Pace $1.5bn 2010 $0.5 $1.3 $1.6 $2.5 ($bn) Note: 19 Estate of AUM: 2011 As Investment family debt in average Capital Real of
Slide 21: Agenda
Agenda Topic 1) Apollo Overview 2) Segment update 3) Financial Overview 4) Appendix 20
Slide 22: Financial Management Philosophies
Financial Management Philosophies Financially conservative – Manage leverage and interest coverage ratios prudently – Generate significant free cash flow Focus on Management Business margins and liquidity – Stable non-performance based management revenue – Disciplined expenditure on compensation and
Slide 23: Strong Mgt. Business Growth & Significant Free Cash Flow
Strong Mgt. Business Growth & Significant Free Cash Flow LTM Q1 ($mm, except per share data) 2011 2012 2013 2014 ManagementbusinessENI – (pre-tax) $76 $223 $331 $417 IncentivebusinessENI (loss)– (pre-tax) (377) 1,411 1,797 1,188 ENI income tax provision 21 159 238 260 Total after-tax ENI (loss) ($32
Slide 24: Robust Growth in Fee-Generating AUM
Robust Growth in Fee-Generating AUM CAGR ($mm) 2011 2012 2013 Q1 2014 (2011-Q1 2014) Total AUM $75 $113 $161 $159 39.6% Fee-generating AUM $58 $82 $128 $129 42.3% Fee-generatingAUMby Segment: Private equity $28 $28 $34 $34 9.2% Credit 27 50 88 88 70.7% Real estate 4 4 6 6 25.5% Total $58 $82 $128 $1
Slide 25: Long-Lived Permanent Capital Base
Long Long-Lived Permanent Fewer 77% 4% (excl. Approximately 89% Note: 24Years or More Duration As Perm. than ofYears Capital March Asset Capital) AUM 96% Base(1) 31, of Creates 2014. AUMDuration Stable is in funds Source of with AUMofaMgt. based contractual Fees on contractual life at inception life
Slide 26: Management Business Performance
Management Business Performance LTM Q1 ($mm, except per share data) 2011 2012 2013 2014 Management fees $490 $623 $731 $791 Advisory & transaction fees 82 150 197 265 NII incentive fees -AINV 45 38 37 36 Total management business revenues 617 811 964 1,092 Compensation expenses 319 344 361 409 Non-c
Slide 27: Incentive Business Performance
Incentive Business Performance LTM ($mm, except per share data) 2011 2012 2013 Q1 2014 Economic ENI ENI – total carry: Private equity ($449) $1,668 $2,517 $1,630 Credit 7 481 337 270 Real estate 0 15 5 4 Total carry ($442) $2,164 $2,859 $1,903 ENI – total profit sharing expense: Private equity ($97)
Slide 28: Flexible Cash Distribution Policy
Flexible Cash $403 $471 26 $5 $98 $157 $227 $337 Q1’12 Apollo’s that Apollo 1. 27 Declared they $94 $434 Distributions Q2’12 intends provides Distribution Distribution willonreceive Q3’12 May toadistribute regular Declared 8, Q4’12 Policy any Policy 2014; distributions. quarterly Q1’13 tofor payable
Slide 29: Strong Financial Condition With Low Levels of Debt
Strong Financial Condition With Low Levels of Debt 1. Financial condition amounts are shown without the impact of certain Apollo funds that are required to be consolidated on its financial statements under U.S. GAAP. 2. Net of profit sharing expense. 3. Includes total General Partner investments usi
Slide 30: Selected Financial Metrics and Leverage Analysis
Selected Financial Metrics and Leverage Analysis LTM Q1 ($mm) 2011 2012 2013 2014 Fee-related EBITDA $197 $339 $438 $560 Fee-related EBITDA + 100% of net realized carry 531 890 1,915 2,103 Interest expense 41 37 29 25 Debt 738 738 750 750 Leverage ratios: Fee-related EBITDA / interest expense 4.8x 9
Slide 31: Agenda
Agenda Topic 1) Apollo Overview 2) Segment update 3) Financial Overview 4) Appendix 30
Slide 32: Bridge to GAAP Financials
Bridge to GAAP Financials LTM ($mm) 2011 2012 2013 Q1 2014 Fee-Related EBITDA + 100% net realized carry $531 $890 $1,915 $2,103 Net unrealized carry (716) 740 208 (493) Net unrealized investment income 5 120 111 138 Net interest expense (41) (37) (29) (25) Depreciation and amortization (11) (10) (11
Slide 33: Carried Interest Income Receivable
Carried Interest Income Receivable ($mm) 2012 2013 Q1 2014 Private equity funds: Fund VII $904 $891 $774 Fund VI 270 698 522 Fund V 134 43 54 Fund IV 11 8 5 Other (AAA, Stanhope) 94 229 219 Total private equity funds $1,413 $1,868 $1,574 Credit funds: U.S. performing credit $402 $180 $163 Opportunis
Slide 34: Structure Chart as of May 9, 2014
Structure Chart as of May 9, 2014 100% of LP Managing Partners units BRH Holdings BRH GP Holdings, L.P. GP, Ltd. (Class B Shares) 88.18% of GP 68.74% of total LP units voting power AP Professional Contributing Partners 11.82% of LP AGM Holdings, L.P. Class A Shareholders units Management, LLC (60.56
Slide 35: Appendix: Credit Fund Summary
Appendix: Credit Fund Summary Apollo Fund Year of Inception Apollo Fund Year of Inception Apollo / Artus Investors 20071 – 2007 ALM VII (R) Ltd. 2013 Apollo Credit Liquidity Fund 2007 ALM VII (R)-2 Ltd. 2013 Apollo Credit Opportunity Fund I 2008 ALM VIII 2013 Apollo Credit Opportunity Fund II 2008 A
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