Apollo Global Management, Inc. (new) · NYSE:APO
Apollo Global Management, Inc. (new) — Apollo Global Management — Deutsche Bank 2013 Global Financial Services Investor Conference
25 slides from Apollo Global Management, Inc. (new)'s conference presentation, Jun 5, 2013
Slide 1: Deutsche Bank 2013 Global Financial Services Investor Conference
Deutsche Bank 2013 Global Financial Services Investor Conference June 5, 2013 Not for distribution in whole or in part without the express consent of Apollo Global Management, LLC. It should not be assumed that investment made in the future will be profitable or will equal the performance of the inv
Slide 2: 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 3: Apollo Global Management, LLC
Apollo Global Management, LLC Apollo Global Management, LLC is a leading global alternative investment manager in private equity, credit and real estate Ticker (NYSE) APO Market Capitalization(1) $9.1 billion Total Assets Under Management(2) $114 billion AUM CAGR (12/31/04 – 3/31/13) 32% LTM Dividen
Slide 4: Agenda
Agenda 1. Apollo’s Integrated Platform 2. Navigating the Current Market Environment 3
Slide 5: Apollo's Integrated Global Platform
Apollo’s Integrated Global Platform Firm Profile (5) Principal Investment Businesses(5) Founded: 1990 Private Equity Credit (7) Real Estate AUM: $114 bn(6) $39bn AUM $64bn AUM $9bn AUM Employees: 644 U.S. Performing Credit Residential and commercial Opportunistic buyouts Inv. Prof.: 252 Dist
Slide 6: Significant Growth and Diversification
Significant Growth and Diversification Apollo’s Total AUM Has Grown By More Than 10x Over the Last Decade ($ in millions) Total AUM: $114bn(8) Private Equity Credit Real Estate Unallocated Strategic Account $2,117 $9,412 Dramatically different 8% o f AUM business today vs. at IPO AUM CAGR: 28% $63,5
Slide 7: Long Track Record of Success in Private Equity
Long Track Record of Success in Private Equity Apollo’s Private Equity Funds: 39% Gross & 26% Net IRR Since Inception 5 Year 10 Year 20 Year 20.3% 19.6% 13.7% 13.6% 14.0% 6.6% 5.4% 6.4% 8.0% 8.5% 8.3% 8.6% 6.6% 1.0% 2.3% (9) (10) (11) Barclays Aggregate S&P 500 Index NCREIF All Private Equity Estima
Slide 8: Strong Credit Performance Across Strategies
Strong Credit Performance Across Strategies U.S. Performing Credit: Opportunistic Credit: European Credit & NPLs: Credit Opportunity Funds I & II(14) Apollo Investment Corporation (AINV)(15) AIE II(16,17) & EPF(17,18) Net IRR Since Inception Weighted Average Yield Net IRR Since Inception 15.6% 11.2
Slide 9: 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 Secular Secular Trends Trends Growth Growth Strategies Strategies Selected Selected Recent Recent
Slide 10: Agenda
Agenda 1. Apollo’s Integrated Platform 2. Navigating the Current Market Environment 9
Slide 11: Fragmented Pace of Growth Around the World
Fragmented Pace of Growth Around the World Developed economies continue to experience low growth rates, with the U.S. outpacing Europe Growth in emerging markets, such as China, has softened United States(19) Euro Area(19) 16% 16% 14% Forecast GDP 14% Forecast GDP GDP Percent change, constant pr
Slide 12: Levered Credit at All-Time Low Yields
Levered Credit at All-Time Low Yields High Yield Bond and Leveraged Loan Yield(20) 23% 21% Peak 12/31/08: 20.27% JPM HY and CS Leveraged Loan Monthly Yields Peak 11/28/08: 20.15% 19% 17% 15% 13% 11% 5/31/13: 5.20% 9% 5/31/13: 5.50% 7% 5% Sep-05 Sep-06 Sep-07 Sep-08 Sep-09 Sep-10 Sep-11 Sep-12 JP Mor
Slide 13: Leverage Levels and Terms are Approaching or Exceeding Pre Crisis Levels
Leverage Levels and Terms are Approaching or Exceeding Pre Crisis Levels LBO Leverage Multiples 7x 6.5x 4th Highest Since 2000 Multiples (Debt / EBITDA) (21) 6.0x 6x Average Since 2000: 5.3x 5.7x 5.4x 5.5x 5.3x 5.3x LBO Leverage 5.0x 4.9x 5x 4.7x 4.5x 4.5x 4x 3x 2x 00 01 02 03 04 05 06 07 08 10 11 1
Slide 14: Global Monetary Easing
Global Monetary Easing Fed Purchases as % Fueling Increase of Total Treasury Issuance in Asset Prices Major Major Central Central Banks Banks Have Have Printed Printed ~$10 ~$10 trillion trillion Since Since 2007 2007 Sum Sum of of Major Major Central Central Bank Bank Balance Sheets(24) Balance She
Slide 15: QE3 and Growth of the Fed's Balance Sheet
QE3 and Growth of the Fed Purchases Fed’s as % of Balance Total Treasury Issuance Sheet Fed Purchases as % of Total Treasury Issuance(25) The Fed is currently purchasing ~$12bn / month of Treasuries in the 20 – 30 year maturity bucket which is ~87% of the total new issuance by the US Treasury per Mo
Slide 16: Private Equity Valuations Remain High
Private Equity Valuations Remain High Private Equity Valuations in the U.S. and Europe Average purchase price 2006 – LTM 2013 Europe: 9.1x United States: 8.9x 10x 9.8x LBO Purchase Price Multiples(27)(28) 9.6x 9.5x 9.5x 9.2x 9.1x 9.2x 9.1x 8.9x 8.9x 9x 8.7x 8.6x 8.7x 8.5x 8.5x 8.4x 8.2x 7.9x 8x 7.7x
Slide 17: Stock Markets are Close to All-Time Highs
Stock Markets are Close to All-Time Highs… …But Trading in the Middle of Valuation Range S&P 500, NASDAQ and Dow(29) 3,800 18,000 Peak 5/21/13: 3,502.12 5/31/13: 3,455.91 16,000 NASDAQ and S&P 500 Daily Prices 3,400 3,000 14,000 12,000 DJIA Daily Prices 2,600 Peak 5/28/13: 15,409.39 5/31/13: 15,155.
Slide 18: How Do We Invest In This Environment?
How Do We Invest In This Environment? Focus on Buying at a Discount… Apollo’s average entry multiple (Fund VII)(31) 6.2x Build Value During Ownership • “Hands-on” investor • Operational improvements • Optimize capital structures • Create financial flexibility …And Exit at an Attractive Multiple Plea
Slide 19: Apollo's Value-Oriented and Flexible Investment Approach
Apollo’s Value-Oriented and Flexible Investment Approach Fund V Fund VI Fund VII Vintage: 2001 Vintage: 2006 Vintage: 2008 Total Commitments: $3.7 bn Total Commitments: $10.1 bn Total Commitments: $14.7 bn Average Entry Multiple Average Entry Multiple Average Entry Multiple 9.6x 8.9x 7.7x 7.7x 6.6x
Slide 20: Apollo's Recent Realization Activity
Apollo’s Recent Realization Activity Apollo’s Private Equity Funds have realized approximately $13 billion of proceeds since the beginning of 2012(37) Public Market Sales to Strategic and Interest / Other Dividends / Recaps Monetization Financial Sponsors Amount Realized $6.3 billion $3.1 billion
Slide 21: APOLLO
APOLLO
Slide 22: Appendix: Credit Fund Summary
Appendix: Credit Fund Summary Apollo Fund Year of Inception Apollo Fund Year of Inception Apollo / Artus Investors 2007 – 1 2007 Compass 2002 2002 Apollo Asia Opportunity Fund 2007 Compass 2003(38) 2003 Apollo Asia Private Credit Fund 2012 Compass 2004 2004 Apollo Credit Liquidity Fund 2007 Compass
Slide 23: Notes
Notes Notes Past performance is not indicative nor a guarantee of future results. See the last page for an “Important Notes Regarding the Use of Index Comparisons.” See prior slide for a full listing of Apollo’s Credit Funds, which may have different or worse performance than the Funds illustrated
Slide 24: Notes (cont'd)
Notes (cont’d) Footnotes (continued) 21. Source: S&P Capital IQ Leveraged Commentary & Data. Represents LBO’s of issuers >$200mm of EBITDA (no relevant transactions during 2009). 22. Source: S&P Capital IQ Leveraged Commentary & Data. 23. Source: S&P Capital IQ Leveraged Commentary & Data. Excludes
Slide 25: Definitions
Definitions Assets Under Management (“AUM”) Definition – refers to the investments we manage or with respect to which we have control, including capital we have the right to call from our investors pursuant to their capital commitments to various funds. Our AUM equals the sum of: (i) the fair value
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