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Apollo Global Management, LLC Reports Third Quarter 2013 Results

Stocks in this article: APO

Combined Segments

Total revenue for Apollo's combined segments was $1,153.4 million for the third quarter ended September 30, 2013, an increase of $394.3 million, or 52%, compared to the same period in 2012, driven primarily by a $376.2 million increase in total carried interest income. Total expenses for Apollo’s combined segments were $584.9 million for the third quarter ended September 30, 2013, an increase of $206.7 million, or 55%, compared to the same period in 2012, driven primarily by an increase in profit sharing expense.

Total revenue for Apollo's Management Business was $203.2 million for the third quarter ended September 30, 2013, an increase of $18.1 million, or 10%, from the same period in 2012. This includes management fee revenues of $165.2 million for the third quarter ended September 30, 2013, an increase of $5.0 million, or 3%, from the same period in 2012. There was also $28.9 million of advisory and transaction fees for the third quarter ended September 30, 2013, an increase of $13.7 million from the same period in 2012, primarily due to increased monitoring fees related to Athene in the third quarter of 2013.

Total expenses for Apollo's Management Business were $160.3 million for the third quarter ended September 30, 2013, an increase of $19.9 million from the same period in 2012. Total compensation expenses, including salary and benefits and equity-based compensation, were $97.8 million for the third quarter of 2013, an increase of $16.5 million from the same period in 2012. The year-over-year increase in compensation expenses was primarily driven by increased headcount across Apollo’s platform in connection with the company's continued growth. Non-compensation expenses for Apollo's Management Business were $62.5 million during the third quarter of 2013, an increase of $3.4 million from the same period in 2012.

Apollo's Incentive Business reported $950.2 million of total carried interest income for the third quarter ended September 30, 2013, an increase of $376.2 million from the same period in 2012. As a result of the increase in carried interest income, Apollo reported total profit sharing expense of $424.6 million for the third quarter ended September 30, 2013, an increase of $186.8 million from the same period in 2012. The increase in total carried interest income during the third quarter of 2013 was driven by increased valuations of a number of investments held by funds managed within Apollo's private equity segment, including Sprouts Farmers Market, Inc. and Athlon Energy, both of which completed initial public offerings during the quarter. During the third quarter ended September 30, 2013 the Incentive Business generated $638.9 million of realized gains, which was largely attributable to dispositions relating to a number of investments held by funds managed by Apollo, including LyondellBasell, Realogy, Evertec, Berry Plastics, Norwegian Cruise Lines, and Countrywide.

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