Apollo Global Management posted its third straight quarterly net loss as rising interest rates continued to weigh on assets held by its Athene retirement services group.
But third quarter adjusted net income — or what the firm formerly called distributable earnings — climbed 6.4% to $800.5m, or $1.33 a share, Apollo said.
Fee-related earnings rose almost 14% to $364.6m, or 61 cents a share.
The $876m, or $1.52-a-share, net loss for the just-ended quarter extended a pattern of unrealised losses that began early this year with the inclusion of Athene results for the first time. In last year’s third quarter, Apollo reported net income of $249.2m, or $1.01 a share.
Apollo’s Athene retirement services group reported nearly $2.85bn of investment losses while the firm’s asset management operation had a $31m investment loss for the period. Apollo said its flagship private equity investments generated a 0.3% loss.
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Management fees surged 16% to $545.9m from $472.5m in the year-earlier period, aided by Athene inflows, investors pouring money into yield funds, or private credit vehicles, and the acquisition of Griffin Capital’s US asset-management operations. Griffin was expected to bring assets of more than $5bn to Apollo.
Total revenue firmwide more than doubled to almost $2.98bn, largely reflecting the addition of Athene results. Apollo’s asset management business saw revenue drop 56% to $477m for the third quarter compared with nearly $1.08bn a year earlier.
The firm invested $37bn over the summer quarter, up 39% from the year-earlier quarter but down about 7.5% from the second quarter.
Assets under management increased $8bn from the end of June to reach $523bn, up 9% from a year earlier.
Uncommitted capital, or dry powder, stood at $51bn at the end of September. A year ago, the firm said it had $46.9bn in dry powder.
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This article was published by The Wall Street Journal, a fellow Dow Jones Group brand