Ares Management Corporation · NYSE:ARES
Ares Management — Investor Day (2021)
28 slides from Ares Management's investor day presentation, 2021
Slide 1: Business Development & Client Strategy
Business Development & Client Strategy Ryan Berry Chief Marketing and Strategy Officer Ares Management Corporation Investor Day 2021 - Not for Publication or Distribution
Slide 2: Important Notice
Important Notice This presentation is prepared for Ares Management Corporation (NYSE: ARES) for the benefit of its public stockholders. This presentation is solely for information purposes in connection with evaluating the business, operations and financial results of Ares Management Corporation (“A
Slide 3: Important Notice
Important Notice Dated information: This video may contain dated information. Viewers are cautioned that this video and the associated presentation is maintained here solely for the purposes of providing historical background about Ares Management Corporation. As the video may contain dated informat
Slide 4: Ares Business Development & Client Strategy Today
Ares Business Development & Client Strategy Today 1 2 3 A powerful network of The ongoing growth We have a tremendous client service teams and diversification of opportunity to broaden working in partnership our AUM highlights the and deepen our Firm’s to develop solutions merits of our approach inv
Slide 5: ~260 Dedicated Professionals Leading our Capital Formation Efforts
~260 Dedicated Professionals Leading our Capital Formation Efforts Strong collaboration enables us to work more effectively with our investors to develop solutions North America Europe Asia Pacific Middle East / Africa Distribution Partners ~30 ~50 ~90 ~90 Strategy Relationship Wealth Solutions Prod
Slide 6: Our AUM has More than Tripled in Under 7 Years
Our AUM has More than Tripled in Under 7 Years Fundraising has been the key driver... $186 billion organic inflows versus $53 billion M&A / opportunistic inflows since our IPO year ($ in billions) $35 ($94) $53 $262 $186 $82 2014 AUM Organic M&A / Opportunistic Appreciation Distributed Capital 1 Q2-
Slide 7: Record Fundraising Periods
Record Fundraising Periods We raised $56 billion over the past 12 months… the equivalent of 34% of the period’s beginning AUM of $165 billion ($ in billions) AUM Organic Inflows $262 $165 $149 $131 $94 $95 $106 $82 $56 $36 $41 $23 $14 $17 $24 Q4-14 Q4-15 Q4-16 Q4-17 Q4-18 Q4-19 Q2-20 1 Q2-21 1 2015
Slide 8: Growth Across All Client Types and Strategies
Growth Across All Client Types and Strategies AUM by Client Type1 AUM by Strategy 1 ($ in billions) $262 CAGR ($ in billions) $262 CAGR NA Secondary Solutions Institutional $19 $25 11% Intermediated $10 NA Strategic Initiatives $41 12% Public & Affiliates $33 25% Real Estate 21% $3 16% Ares 21% $31
Slide 9: Deepening Our Relationships
Deepening Our Relationships Direct AUM by # of Groups # of 1 Billion+ Direct Relationships LTM Direct Inflows by Existing vs. New $57B $195B 49 New Investors 38% 1 Group 16% Existing Investors 53% Fund Family Re-Up 62% 4.5x 34% 37% 32% 2 Groups Existing Investors Not a Fund Family Re-Up 30% 50% 11 3
Slide 10: Onboarding New Investors & Entering New Geographies
Onboarding New Investors & Entering New Geographies % of Direct AUM by Region # of Direct Relationships (# of Countries) Increase in 1,792 $57B (35) $195B (54) Countries 12% (8) 15% (12) +4 Asia Pacific 863 30% (19) 2.6x 27% (29) +10 EMEA 683 4.6x New to Ares 59% (8) 59% (13) +5 Americas 479 929 in
Slide 11: Dedicated Strategy Teams Pursuing Other Growth Avenues
Dedicated Strategy Teams Pursuing Other Growth Avenues 3 Platforms in Past Year 3 Investments in Past 18 Months Platform • SSG Capital ($6.9 billion of AUM) Strategic • Crestline Denali ($2.7 billion of AUM) Acquisitions • Landmark ($19.5 billion of AUM) Investments • F&G Re ($2.2 billion of AUM) •
Slide 12: The Ares Value Proposition
The Ares Value Proposition Ares provides institutional and retail investors with comprehensive investment solutions to meet their evolving needs Selected Targeted Benefits of Investing in Selected Targeted Benefits of Investing with Alternatives $ Generate compelling cash yields Strong investment p
Slide 13: Alternative Assets Continue to Take Share
Alternative Assets Continue to Take Share Alternatives expected to grow at 12% CAGR over the next five years… going from doubling to tripling the growth rate of global client assets Global Client Assets1 Alternative Assets Under Management2 ($ in trillions) Excludes Hedge Funds ($ in trillions) $12.
Slide 14: Black Creek Transforms Our Retail Distribution Platform
Black Creek Transforms Our Retail Distribution Platform Retail investor allocations to alternative assets are increasing rapidly… we are excited to partner with our new Wealth Solutions colleagues Retail Assets Investing in Alternatives1 90+ Person Nationwide Distribution Platform ($ in trillions) 8
Slide 15: Selected Growth Drivers
Selected Growth Drivers • 81% of institutional investors expected to increase allocations to alternatives by 2025 1 1 2• 40 of the Top 100 global asset owners do not currently have a direct institutional relationship with Ares 2 • 29 of the 60 investors that do have a relationship are only invested
Slide 16: Closing Remarks
Closing Remarks 1 2 3 A powerful network of The ongoing growth We have a tremendous client service teams and diversification of opportunity to broaden working in partnership our AUM highlights the and deepen our Firm’s to develop solutions merits of our approach investor relationships 4 We have wond
Slide 17: Appendix
Appendix Ares Management Corporation Investor Day 2021 - Not for Publication or Distribution
Slide 18: GAAP Statement Of Operations
GAAP Statement Of Operations Year Ended December 31, $ in thousands, except share data Q2-21 LTM 2020 2019 2018 2017 2016 2015 2014 Revenues Management fees $1,307,451 $1,150,608 $979,417 $802,502 $722,419 $642,068 $634,399 $486,477 Carried interest allocation 1,583,262 505,608 621,872 42,410 620,45
Slide 19: RI and Other Measures Financial Summary
RI and Other Measures Financial Summary Year Ended December 31, $ in thousands, except share data (and as otherwise noted) Q2-21 LTM 2020 2019 2018 2017 2016 2015 2014 Management fees(1) $1,335,413 $1,186,565 $1,012,530 $836,744 $744,825 $659,451 $650,918 $598,046 Other fees 25,993 19,948 18,078 24,
Slide 20: GAAP to Non-GAAP Reconciliation – Unconsolidated Reporting Basis
GAAP to Non-GAAP Reconciliation – Unconsolidated Reporting Basis Year Ended December 31, $ in thousands Q2-21 LTM 2020 2019 2018 2017 2016 2015 2014 Realized Income and Fee Related Earnings: Income before taxes $944,635 $379,478 $425,180 $184,341 $149,859 $297,920 $81,484 $556,915 Adjustments: Amort
Slide 21: GAAP to Non-GAAP Reconciliation – Unconsolidated Reporting Basis (cont'd)
GAAP to Non-GAAP Reconciliation – Unconsolidated Reporting Basis (cont'd) Year Ended December 31, $ in thousands Q2-21 LTM 2020 2019 2018 2017 2016 2015 2014 Performance income and net investment income reconciliation: Carried interest allocation $1,583,262 $505,608 $621,872 $42,410 $620,454 $494,58
Slide 22: Glossary
Glossary Ares Management Corporation Investor Day 2021 - Not for Publication or Distribution
Slide 23: Glossary
Glossary ARCC Part II Fees ARCC Part II Fees refers to fees that are paid in arrears as of the end of each calendar year when the cumulative aggregate realized capital gains exceed the cumulative aggregate realized capital losses and aggregate unrealized capital depreciation, less the aggregate amou
Slide 24: Glossary
Glossary Fee Related Earnings Fee Related Earnings or “FRE”, a non-GAAP measure, is used to assess core operating performance by determining whether recurring revenue, primarily consisting of management fees, is sufficient to cover operating expenses and to generate profits. FRE differs from income
Slide 25: Glossary
Glossary Our Funds Our Funds refers to the funds, alternative asset companies, co-investment vehicles and other entities and accounts that are managed or co-managed by the Ares Operating Group, and which are structured to pay fees. It also includes funds managed by Ivy Hill Asset Management, L.P., a
Slide 26: Endnotes – Business Development & Client Strategy
Endnotes – Business Development & Client Strategy Ares Management Corporation Investor Day 2021 - Not for Publication or Distribution
Slide 27: Business Development & Client Strategy Endnotes
Business Development & Client Strategy Endnotes Alternative Assets Continue to Take Share 1. Source: PwC, Asset and Wealth Management Revolution: The Power to Shape the Future. 2. Source: Preqin, The Future of Alternatives 2025 report. 3. Source: PwC, Asset and Wealth Management Revolution: The Powe
Slide 28: Ares Management Corporation Investor Day 2021 - Not for Publication or Distribution
Ares Management Corporation Investor Day 2021 - Not for Publication or Distribution