Apollo Global Management, Inc. - FORM 8-K - EX-99.1

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8-K - 8-K - Apollo Global Management, Inc.	a8-kforq4earningsrelease.htm

Exhibit 99.1

Apollo Global Management, LLC Reports Fourth Quarter and Full Year 2013 Results


•	Apollo declares a distribution of $1.08 per Class A share for the fourth quarter of 2013, bringing full year distributions to $3.98 per Class A share


•	Total economic net income (“ENI”) after taxes of $421.7 million and $1,889.4 million for the fourth quarter and year ended December 31, 2013, respectively, compared to $655.8 million and $1,475.8 million for the comparable periods in 2012, respectively


•	ENI after taxes per share of $1.06 and $4.80 for the fourth quarter and year ended December 31, 2013, respectively, compared to $1.69 and $3.82 per share for the comparable periods in 2012, respectively


•	Total assets under management (“AUM”) of $161.2 billion as of December 31, 2013, compared to $113.4 billion as of December 31, 2012


•	U.S. GAAP net income attributable to Apollo Global Management, LLC of $159.2 million and $659.4 million for the fourth quarter and year ended December 31, 2013, respectively, compared to $171.5 million and $311.0 million for the comparable periods in 2012, respectively


•	On October 2, 2013, Athene Holding Ltd. closed its acquisition of Aviva USA, resulting in $44 billion of additional AUM within Apollo’s credit segment


•	On December 31, 2013, Apollo held a final close for its current flagship private equity fund, Apollo Investment Fund VIII, raising $17.5 billion in third-party capital and approximately $880 million of additional capital from Apollo and affiliated investors

New York, February 7, 2014 - Apollo Global Management, LLC (NYSE: APO) (together with its consolidated subsidiaries, “Apollo”) today reported results for the fourth quarter and year ended December 31, 2013.

Apollo reported ENI after taxes of $421.7 million for the fourth quarter ended December 31, 2013, compared to $655.8 million for the same period in 2012. The $234.1 million decrease in ENI was driven by Apollo's Incentive Business, which reported ENI of $366.2 million for the fourth quarter ended December 31, 2013, compared to $632.6 million for the same period in 2012. The $266.4 million year-over-year decrease in ENI for the Incentive Business was largely the result of lower carried interest income from Apollo's private equity segment during the fourth quarter of 2013 compared to the same period in 2012.

Apollo reported ENI after taxes of $1,889.4 million for the year ended December 31, 2013, compared to ENI after taxes of $1,475.8 million in 2012. The $413.6 million increase in ENI after taxes was driven by Apollo’s Management and Incentive Businesses, which reported ENI of $330.8 million

and $1,796.9 million, respectively, for the year ended December 31, 2013, compared to $222.9 million and $1,411.5 million, respectively, in 2012.

Apollo's total AUM was $161.2 billion as of December 31, 2013, an increase of $47.8 billion compared to $113.4 billion as of December 31, 2012. The increase in total AUM and fee-generating AUM was driven by growth in Apollo's credit and private equity segments. Fee-generating AUM was $128.4 billion as of December 31, 2013, an increase of $46.5 billion compared to $81.9 billion as of December 31, 2012. During the fourth quarter of 2013, Athene Holding Ltd. (together with its subsidiaries, “Athene”), for which Apollo currently provides asset allocation and related services through its consolidated subsidiary, Athene Asset Management, L.P. ("Athene Asset Management"), closed its acquisition of the U.S. annuity operations of Aviva plc (“Aviva USA”), which added approximately $44 billion of total and fee-generating AUM to Apollo’s credit segment.

U.S. GAAP results for the fourth quarter ended December 31, 2013 included net income attributable to Apollo Global Management, LLC of $159.2 million, or $0.94 per Class A share, compared to $171.5 million, or $1.12 per Class A share, for the fourth quarter ended December 31, 2012. For the year ended December 31, 2013, net income attributable to Apollo Global Management, LLC was $659.4 million, or $4.06 per Class A share, compared to net income of $311.0 million, or $2.06 per Class A share, for the year ended December 31, 2012.

“Our results for the fourth quarter of 2013 completed an exceptional year for Apollo,” said Leon Black, Chairman and Chief Executive Officer. “We recently held the final close for Fund VIII, the largest fund in our firm’s history, and we increased total AUM by 42% to $161 billion during 2013. Over the last four quarters we also returned nearly $23 billion to our fund investors across all of Apollo’s business segments, and we generated $3.98 per share in cash distributions for our shareholders. As we look to 2014 and beyond, we believe Apollo’s integrated global investment platform leaves us well-positioned to continue to deliver strong returns to our investors as we remain committed to our disciplined, value-oriented investment approach.”

Combined Segments

Total revenue for Apollo's combined segments was $822.5 million for the fourth quarter ended December 31, 2013, a decrease of $363.0 million, or 31%, compared to the same period in 2012, driven primarily by a $435.5 million decrease in total carried interest income. Total expenses for Apollo’s combined segments were $384.9 million for the fourth quarter ended December 31, 2013, a decrease of $144.6 million, or 27%, compared to the same period in 2012, driven primarily by a decrease in profit sharing expense.

Total revenue for Apollo's combined segments was $3,823.3 million for the year ended December 31, 2013, an increase of $848.9 million, or 29%, from 2012, driven primarily by a $695.6 million increase in total carried interest income. Total expenses for Apollo’s combined segments were $1,836.4 million for the year ended December 31, 2013, an increase of $364.0 million, or 25%, from 2012, driven primarily by an increase in profit sharing expense.

Total revenue for Apollo's Management Business was $295.7 million for the fourth quarter ended December 31, 2013, an increase of $72.5 million, or 32%, from the same period in 2012. This includes management fee revenues of $231.8 million for the fourth quarter ended December 31, 2013, an increase of $55.4 million, or 31%, from the same period in 2012. There was also $55.2 million of advisory and transaction fees for the fourth quarter ended December 31, 2013, an increase of $17.7

million, or 47% from the same period in 2012, primarily due to increased monitoring fees related to Athene in the fourth quarter of 2013.

Total revenue for Apollo's Management Business was $964.1 million for the year ended December 31, 2013, an increase of $153.3 million, or 19%, from 2012 driven primarily by an increase in Apollo’s fee-generating AUM. This includes management fee revenues of $730.6 million for full year 2013, an increase of $107.6 million, or 17%, from 2012. There was also $196.6 million of advisory and transaction fees for the full year 2013, an increase of $46.6 million from 2012, primarily due to monitoring fees related to Athene.

Total expenses for Apollo's Management Business were $187.1 million for the fourth quarter ended December 31, 2013, an increase of $23.0 million, or 14%, from the same period in 2012. Total compensation expenses, including salary and benefits and equity-based compensation, were $86.4 million for the fourth quarter of 2013, a decrease of $2.8 million from the same period in 2012. Non-compensation expenses for Apollo's Management Business were $100.7 million during the fourth quarter of 2013, an increase of $25.8 million from the same period in 2012 primarily due to fund formation expenses in connection with the final close of Apollo Investment Fund VIII, L.P. ("Fund VIII").

Total expenses for Apollo's Management Business were $663.2 million for the year ended December 31, 2013, an increase of $63.0 million from 2012. Total compensation expenses, including salary and benefits and equity-based compensation, were $361.1 million for the full year 2013, an increase of $17.6 million, or 5%, from 2012. Non-compensation expenses for Apollo's Management Business were $302.1 million during the full year 2013, an increase of $45.4 million from 2012 primarily due to higher professional fees and fund formation expenses.

Apollo's Incentive Business reported $526.8 million of total carried interest income for the fourth quarter ended December 31, 2013, a decrease of $435.5 million from the same period in 2012. As a result of the decrease in carried interest income, Apollo reported total profit sharing expense of $197.8 million for the fourth quarter ended December 31, 2013, a decrease of $167.6 million from the same period in 2012. The decrease in total carried interest income during the fourth quarter of 2013 compared to the same period in 2012 was driven by the absence in the fourth quarter of 2013 of "catch-up" unrealized carried interest income from Fund VI that was earned in the fourth quarter of 2012 as the fund crossed its preferred return hurdle. During the fourth quarter ended December 31, 2013, the Incentive Business generated $631.8 million of realized gains, which was largely attributable to dispositions relating to a number of investments held by funds managed by Apollo, including LyondellBasell Industries N.V., Sprouts Farmers Market, Inc., CKE Restaurants, Inc., Evertec, Inc., Norwegian Cruise Line Holdings Ltd., Taminco Corporation, and Countrywide plc.

Apollo's Incentive Business reported $2,859.2 million of total carried interest income for the year ended December 31, 2013, an increase of $695.6 million from 2012. As a result of the increase in carried interest income, Apollo reported total profit sharing expense of $1,173.2 million for the year ended December 31, 2013, an increase of $301.0 million from 2012. During the year ended December 31, 2013, the Incentive Business generated $2,456.4 million of realized gains, which was attributable to significant dispositions relating to numerous investments held by funds managed by Apollo.

Private Equity Segment

Apollo's private equity segment generated ENI of $314.8 million for the fourth quarter ended December 31, 2013, compared to $601.9 million for the same period in 2012. The year-over-year

decrease in ENI was largely driven by lower carried interest income of $445.4 million for the fourth quarter of 2013, compared to $873.1 million for the fourth quarter of 2012.

Apollo's private equity funds continued to perform well as measured by internal rate of return (“IRR”) and appreciated by 9% during the fourth quarter ended December 31, 2013. From its inception in 2008 through December 31, 2013, Fund VII generated an annual gross and net IRR of 39% and 30%, respectively. Fund VI, which began investing in 2006, generated an annual gross and net IRR of 15% and 12%, respectively, since its inception through December 31, 2013. The combined fair value of Apollo's private equity funds, including AP Alternative Assets, L.P. (“AAA”), was 65% above cost as of December 31, 2013. Uncalled private equity commitments were $23.7 billion as of December 31, 2013 and $1.1 billion of private equity capital was deployed during the fourth quarter ended December 31, 2013.

On December 31, 2013 Apollo held the final close of its current flagship private equity fund, Fund VIII with total third party committed capital of $17.5 billion (excluding approximately $880 million of additional capital from Apollo and affiliated investors).

Management fees from Apollo's private equity segment were $88.0 million for the fourth quarter ended December 31, 2013, which increased by $15.7 million compared to the same period in 2012 primarily due to the commencement of Fund VIII’s investment period and associated one-time catch-up fees. Total Management Business expenses within the private equity segment were $80.1 million for the fourth quarter of 2013, which increased by $22.1 million compared to the same period in 2012 primarily due to fund formation expenses associated with the final closing of Fund VIII. As of December 31, 2013, Apollo's private equity segment AUM was $49.9 billion, compared to $37.8 billion at December 31, 2012.

Credit Segment

Apollo's credit segment generated ENI of $160.1 million for the fourth quarter ended December 31, 2013, compared to ENI of $96.8 million for the fourth quarter of 2012. The year-over-year increase in ENI resulted from an increased contribution from the Management Business, which generated ENI of $97.5 million for the fourth quarter of 2013, compared to $27.0 million for the same period in 2012 as a result of higher management fees and advisory and transaction fees.

Management fees from Apollo's credit segment were $130.6 million for the fourth quarter ended December 31, 2013, which increased by $38.6 million, or 42%, compared to the same period in 2012 primarily due to higher fee-generating AUM from Athene. Total Management Business expenses within the credit segment were $89.6 million for the fourth quarter of 2013, which increased by $2.2 million compared to the same period in 2012. As of December 31, 2013, Apollo's credit segment AUM was $100.9 billion, compared to $64.4 billion at December 31, 2012.

Real Estate Segment

Apollo's real estate segment had ENI of $3.9 million for the fourth quarter of 2013, compared to an economic net loss of $1.8 million for the same period in 2012. Total revenues for the real estate segment during the fourth quarter of 2013 were $21.5 million, an increase of $4.9 million, or 30%, compared to the same period in 2012. Total expenses for the real estate segment during the fourth quarter of 2013 were $20.0 million, an increase of $0.9 million, or 5%, compared to the same period in 2012. As of December 31, 2013, Apollo's real estate segment AUM was $9.3 billion, compared to $8.8 billion at December 31, 2012.

Capital and Liquidity

As of December 31, 2013, Apollo had $1,078 million of cash and cash equivalents and $750 million of debt (which does not include a $500 million revolving credit facility that was undrawn as of December 31, 2013). These amounts exclude cash and debt associated with Apollo's consolidated funds and consolidated variable interest entities (“VIEs”). As of December 31, 2013, Apollo had a $2,367 million carried interest receivable on an unconsolidated basis and corresponding profit sharing payable of $992 million, as well as total investments in its private equity, credit and real estate funds of $422 million, excluding investments held by consolidated VIEs and consolidated funds.

Distribution

Apollo Global Management, LLC has declared a fourth quarter 2013 cash distribution of $1.08 per Class A share, which comprises a regular quarterly distribution of $0.15 per Class A share and a distribution of $0.93 per Class A share attributable to additional carried interest earned by our funds through realizations and Management Business earnings. This distribution will be paid on February 26, 2014 to holders of record at the close of business on February 19, 2014. Apollo intends to distribute to its shareholders on a quarterly basis substantially all of its net after tax cash flow in excess of amounts determined by its manager to be necessary or appropriate to provide for the conduct of its business. However, Apollo cannot assure its shareholders that they will receive any distributions.

2013 Schedule K-1 Distribution

The 2013 schedules K-1 will be available on or about March 15, 2014 and can be accessed via www.partnerdatalink.com/Apollo. You can visit this site now to register your email address to be notified when the 2013 schedules K-1 are available to be downloaded. Please note that the income, gain, loss, deduction, or credit reported to you on schedule K-1 is independent of the annual cash generated and the annual cash distributions made by Apollo. As a partnership for U.S. federal income tax purposes, investors in Apollo are required to report their share of the income, gain, loss, deduction, or credit that is allocated to them from Apollo. The U.S. federal taxable income of Apollo is determined by using the applicable U.S. federal income tax rules, and these amounts may vary from year to year depending on the nature of the income of Apollo and the activity of its subsidiaries.

Conference Call

Apollo will host a conference call on Friday, February 7, 2014 at 10:00 a.m. Eastern Time. During the call, Marc Spilker, President, Martin Kelly, Chief Financial Officer, and Gary Stein, Head of Corporate Communications, will review Apollo's financial results for the fourth quarter and full year ended December 31, 2013. The conference call may be accessed by dialing (888) 868-4188 (U.S. domestic) or +1 (615) 800-6914 (international), and providing conference call ID 31311122 when prompted by the operator. The number should be dialed at least ten minutes prior to the start of the call. A simultaneous webcast of the conference call will be available to the public on a listen-only basis and can be accessed through the Investor Relations section of Apollo's website at www.agm.com.

Following the call, a replay of the event may be accessed either telephonically or via audio webcast. A telephonic replay of the live broadcast will be available approximately two hours after the live broadcast by dialing (800) 585-8367 (U.S. callers) or +1 (404) 537-3406 (non-U.S. callers), pass

code 31311122. To access the audio webcast, please visit Events in the Investor Relations section of Apollo's website at www.agm.com.

About Apollo

Apollo is a leading global alternative investment manager with offices in New York, Los Angeles, Houston, London, Frankfurt, Luxembourg, Singapore, Mumbai and Hong Kong. Apollo had assets under management of approximately $161 billion as of December 31, 2013 in private equity, credit and real estate funds invested across a core group of nine industries where Apollo has considerable knowledge and resources. For more information about Apollo, please visit www.agm.com.

Contact Information

For inquiries regarding Apollo, please contact:

Gary M. Stein

Head of Corporate Communications

Apollo Global Management, LLC

212-822-0467

gstein@apollolp.com

Noah Gunn

Investor Relations Manager

Apollo Global Management, LLC

212-822-0540

ngunn@apollolp.com

For media inquiries regarding Apollo, please contact:

Charles Zehren

Rubenstein Associates, Inc. for Apollo Global Management, LLC

(212) 843-8590

czehren@rubenstein.com

Forward-Looking Statements

This press release may contain forward looking statements that are within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include, but are not limited to, discussions related to Apollo's expectations regarding the performance of its business, its liquidity and capital resources and the other non-historical statements in the discussion and analysis. These forward-looking statements are based on management's beliefs, as well as assumptions made by, and information currently available to, management. When used in this press release, the words “believe,” “anticipate,” “estimate,” “expect,” “intend” and similar expressions are intended to identify forward-looking statements. Although management believes that the expectations reflected in these forward-looking statements are reasonable, it can give no assurance that these expectations will prove to have been correct. These statements are subject to certain risks, uncertainties and assumptions, including risks relating to our dependence on certain key personnel, our ability to raise new private equity, credit or real estate funds, market conditions, generally, our ability to manage our growth, fund performance, changes in our regulatory environment and tax status, the variability of our revenues, net income and cash flow, our use of leverage to finance our businesses and investments by our funds and litigation risks, among others. We believe these factors include but are not limited to those described under the section entitled “Risk Factors” in the Company's Form 10-K filed with the Securities and Exchange Commission (“SEC”) on March 1, 2013, and such factors may be updated from time to time in our periodic filings with the SEC, which are accessible on the SEC's website at www.sec.gov. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this press release and in other filings. We undertake no obligation to publicly update or review any forward-looking statements, whether as a result of new information, future developments or otherwise, except as required by applicable law. This press release does not constitute an offer of any Apollo fund.

APOLLO GLOBAL MANAGEMENT, LLC

CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

FOR THE THREE MONTHS ENDED DECEMBER 31, 2013 AND 2012

(dollars in thousands, except share data)



	Three Months Ended December 31,
	2013			2012
Revenues:
Advisory and transaction fees from affiliates, net	$	55,097		$	37,382
Management fees from affiliates	217,990			162,488
Carried interest income from affiliates	522,061			959,351
Total Revenues	795,148			1,159,221
Expenses:
Compensation and benefits:
Equity-based compensation	16,608			163,267
Salary, bonus and benefits	70,809			69,908
Profit sharing expense	197,849			365,453
Total Compensation and Benefits	285,266			598,628
Interest expense	6,969			8,033
Professional fees	26,930			24,833
General, administrative and other	27,504			21,151
Placement fees	26,761			8,927
Occupancy	10,143			9,858
Depreciation and amortization	12,638			16,215
Total Expenses	396,211			687,645
Other Income:
Net gains from investment activities	202,941			138,287
Net gains (losses) from investment activities of consolidated variable interest entities	108,478			(41,791		)
Income from equity method investments	27,234			26,982
Interest income	2,822			2,600
Other income, net	13,404			5,010
Total Other Income	354,879			131,088
Income before income tax provision	753,816			602,664
Income tax provision	(23,647		)	(18,283		)
Net Income	730,169			584,381
Net income attributable to Non-controlling Interests	(571,009		)	(412,872		)
Net Income Attributable to Apollo Global Management, LLC	$	159,160		$	171,509
Distributions Declared per Class A Share	$	1.01		$	0.40
Net Income Per Class A Share:
Net Income Available to Class A Share – Basic	$	0.94		$	1.12
Net Income Available to Class A Share –Diluted	$	0.93		$	1.12
Weighted Average Number of Class A Shares – Basic	145,132,700			130,027,037
Weighted Average Number of Class A Shares – Diluted	148,542,859			132,678,221

APOLLO GLOBAL MANAGEMENT, LLC

CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011

(dollars in thousands, except share data)



	Year Ended December 31,
	2013			2012			2011
Revenues:
Advisory and transaction fees from affiliates, net	$	196,562		$	149,544		$	81,953
Management fees from affiliates	674,634			580,603			487,559
Carried interest income (loss) from affiliates	2,862,375			2,129,818			(397,880		)
Total Revenues	3,733,571			2,859,965			171,632
Expenses:
Compensation and benefits:
Equity-based compensation	126,227			598,654			1,149,753
Salary, bonus and benefits	294,753			274,574			251,095
Profit sharing expense	1,173,255			872,133			(60,070		)
Total Compensation and Benefits	1,594,235			1,745,361			1,340,778
Interest expense	29,260			37,116			40,850
Professional fees	83,407			64,682			59,277
General, administrative and other	98,202			87,961			75,558
Placement fees	42,424			22,271			3,911
Occupancy	39,946			37,218			35,816
Depreciation and amortization	54,241			53,236			26,260
Total Expenses	1,941,715			2,047,845			1,582,450
Other Income:
Net gains (losses) from investment activities	330,235			288,244			(129,827		)
Net gains (losses) from investment activities of consolidated variable interest entities	199,742			(71,704		)	24,201
Income from equity method investments	107,350			110,173			13,923
Interest income	12,266			9,693			4,731
Other income, net	40,114			1,964,679			205,520
Total Other Income	689,707			2,301,085			118,548
Income (loss) before income tax provision	2,481,563			3,113,205			(1,292,270		)
Income tax provision	(107,569		)	(65,410		)	(11,929		)
Net Income (Loss)	2,373,994			3,047,795			(1,304,199		)
Net (income) loss attributable to Non-controlling Interests	(1,714,603		)	(2,736,838		)	835,373
Net Income (Loss) Attributable to Apollo Global Management, LLC	$	659,391		$	310,957		$	(468,826	)
Distributions Declared per Class A Share	$	3.95		$	1.35		$	0.83
Net Income Per Class A Share:
Net Income (Loss) Available to Class A Share – Basic	$	4.06		$	2.06		$	(4.18	)
Net Income (Loss) Available to Class A Share –Diluted	$	4.03		$	2.06		$	(4.18	)
Weighted Average Number of Class A Shares – Basic	139,173,386			127,693,489			116,364,110
Weighted Average Number of Class A Shares – Diluted	142,214,350			129,540,377			116,364,110

APOLLO GLOBAL MANAGEMENT, LLC

SEGMENT RESULTS (UNAUDITED)

(dollars in millions, except share data)

Summary of Combined Segment Results for Management Business and Incentive Business:



	Three Months Ended																								Year Ended
	March 31, 2012			June 30, 2012			September 30, 2012			December 31, 2012			March 31, 2013			June 30, 2013			September 30, 2013			December 31, 2013			December 31, 2012			December 31, 2013
Management Business:
Advisory and transaction fees from affiliates, net	$	27.3		$	70.0		$	15.2		$	37.5		$	47.4		$	65.1		$	28.9		$	55.2		$	150.0		$	196.6
Management fees from affiliates	130.0			156.4			160.2			176.4			164.3			169.3			165.2			231.8			623.0			730.6
Carried interest income from affiliates:
Realized gains	9.6			9.2			9.7			9.3			9.0			10.1			9.1			8.7			37.8			36.9
Total management business revenues	166.9			235.6			185.1			223.2			220.7			244.5			203.2			295.7			810.8			964.1
Equity-based compensation⁽¹⁾	18.9			14.1			16.7			19.2			17.4			16.8			16.5			15.6			68.9			66.3
Salary, bonus and benefits	65.1			74.9			64.6			70.0			73.4			69.3			81.3			70.8			274.6			294.8
Interest expense	11.4			10.2			7.5			8.0			7.5			7.6			7.2			7.0			37.1			29.3
Professional fees	11.3			16.5			10.9			24.6			15.4			21.6			18.4			27.0			63.3			82.4
General, administrative and other	18.7			23.1			23.9			20.9			22.6			25.9			21.3			27.3			86.6			97.1
Placement fees	0.9			8.1			4.3			9.0			9.4			3.1			3.2			26.7			22.3			42.4
Occupancy	8.7			9.0			9.7			9.8			9.8			10.2			9.8			10.1			37.2			39.9
Depreciation and amortization⁽²⁾	2.4			2.4			2.8			2.6			2.9			2.9			2.6			2.6			10.2			11.0
Total non-compensation expenses	53.4			69.3			59.1			74.9			67.6			71.3			62.5			100.7			256.7			302.1
Total management business expenses	137.4			158.3			140.4			164.1			158.4			157.4			160.3			187.1			600.2			663.2
Other income (loss)	7.0			(4.5		)	11.1			7.4			7.2			5.2			22.8			8.7			21.0			43.9
Non-controlling interest⁽³⁾	(1.4		)	(2.4		)	(2.7		)	(2.2		)	(3.5		)	(3.2		)	(2.8		)	(4.5		)	(8.7		)	(14.0		)
Management Business Economic Net Income	35.1			70.4			53.1			64.3			66.0			89.1			62.9			112.8			222.9			330.8
Incentive Business:
Carried interest income:
Unrealized gains (losses)	474.3			(52.8		)	344.2			400.7			771.4			(574.9		)	311.3			(105.0		)	1,166.4			402.8
Realized gains	149.8			56.0			229.8			561.6			345.2			840.5			638.9			631.8			997.2			2,456.4
Total carried interest income	624.1			3.2			574.0			962.3			1,116.6			265.6			950.2			526.8			2,163.6			2,859.2
Profit sharing expense:
Unrealized profit sharing expense	178.4			(10.8		)	124.7			133.8			272.8			(219.6		)	165.3			(23.2		)	426.1			195.3
Realized profit sharing expense	70.7			30.7			113.1			231.6			150.8			346.8			259.3			221.0			446.1			977.9
Total profit sharing expense	249.1			19.9			237.8			365.4			423.6			127.2			424.6			197.8			872.2			1,173.2
Other income, net	—			—			—			—			—			0.3			2.9			7.0			—			10.2
Net gains (losses) from investment activities	3.4			(13.1		)	2.1			6.5			4.0			(5.7		)	(7.1		)	(3.8		)	(1.1		)	(12.6		)
Income from equity method investments	48.5			1.4			42.1			29.2			29.4			19.2			30.7			34.0			121.2			113.3
Other income (loss)	51.9			(11.7		)	44.2			35.7			33.4			13.8			26.5			37.2			120.1			110.9
Incentive Business Economic Net Income (Loss)	426.9			(28.4		)	380.4			632.6			726.4			152.2			552.1			366.2			1,411.5			1,796.9
Total Economic Net Income	462.0			42.0			433.5			696.9			792.4			241.3			615.0			479.0			1,634.4			2,127.7
Income Tax Provision on Economic Net Income⁽⁴⁾	(39.7		)	(23.3		)	(54.5		)	(41.1		)	(51.1		)	(43.5		)	(86.4		)	(57.3		)	(158.6		)	(238.3		)
Total Economic Net Income After Taxes	$	422.3		$	18.7		$	379.0		$	655.8		$	741.3		$	197.8		$	528.6		$	421.7		$	1,475.8		$	1,889.4
Non-GAAP Weighted Average Diluted Shares Outstanding (in millions)	383.6			386.0			386.9			388.3			392.1			393.8			394.8			395.3			386.2			393.9
Total ENI After Taxes per Share	$	1.10		$	0.05		$	0.98		$	1.69		$	1.89		$	0.50		$	1.34		$	1.06		$	3.82		$	4.80


(1)	The combined amounts relate to restricted share units (“RSUs”) (excluding RSUs granted in connection with the 2007 private placement) and share options. Excludes equity-based compensation expense comprising amortization of Apollo Operating Group (“AOG”) units.


(2)	Includes amortization of leasehold improvements.


(3)	Reflects the remaining interest held by certain individuals who receive an allocation of income from certain of the credit management companies.


(4)	See the definition of ENI After Taxes in the non-GAAP financial information and definitions section of this press release.

APOLLO GLOBAL MANAGEMENT, LLC

SEGMENT RESULTS (UNAUDITED)

(dollars in millions, except share data)

Private Equity Segment:⁽¹⁾



	Three Months Ended																			Year Ended
	March 31, 2012		June 30, 2012			September 30, 2012		December 31, 2012		March 31, 2013		June 30, 2013			September 30, 2013		December 31, 2013			December 31, 2012		December 31, 2013
Management Business:
Advisory and transaction fees from affiliates, net	$	23.2	$	61.5		$	9.6	$	27.4	$	24.5	$	41.8		$	5.6	$	6.5		$	121.7	$	78.4
Management fees from affiliates	67.0		69.2			68.5		72.3		66.3		65.7			64.8		88.0			277.0		284.8
Total management business revenues	90.2		130.7			78.1		99.7		90.8		107.5			70.4		94.5			398.7		363.2
Equity-based compensation	7.8		7.4			7.2		8.8		8.4		7.5			7.5		8.6			31.2		32.0
Salary, bonus and benefits	25.2		31.7			19.3		27.9		27.4		25.7			27.9		28.8			104.1		109.8
Other expenses	20.8		23.9			17.3		21.3		21.9		26.8			21.1		42.7			83.3		112.5
Total management business expenses	53.8		63.0			43.8		58.0		57.7		60.0			56.5		80.1			218.6		254.3
Other income (loss)	3.3		(3.2		)	2.9		1.7		1.6		0.9			6.7		3.8			4.7		13.0
Management Business Economic Net Income	39.7		64.5			37.2		43.4		34.7		48.4			20.6		18.2			184.8		121.9
Incentive Business:
Carried interest income:
Unrealized gains (losses)	326.0		(37.7		)	152.4		414.2		697.6		(509.7		)	318.3		(51.5		)	854.9		454.7
Realized gains	122.1		43.4			188.2		458.9		293.4		738.2			534.1		496.9			812.6		2,062.6
Total carried interest income	448.1		5.7			340.6		873.1		991.0		228.5			852.4		445.4			1,667.5		2,517.3
Profit sharing expense:
Unrealized profit sharing expense	153.7		(9.1		)	70.2		129.2		256.0		(199.6		)	129.0		(37.7		)	344.0		147.7
Realized profit sharing expense	58.3		25.7			97.0		202.0		131.9		312.9			229.1		208.8			383.0		882.7
Total profit sharing expenses	212.0		16.6			167.2		331.2		387.9		113.3			358.1		171.1			727.0		1,030.4
Other income, net	—		—			—		—		—		0.1			0.4		1.2			—		1.7
Income from equity method investments	30.6		1.9			24.9		16.6		22.6		12.0			23.2		21.1			74.0		78.9
Total other income	30.6		1.9			24.9		16.6		22.6		12.1			23.6		22.3			74.0		80.6
Incentive Business Economic Net Income (Loss)	266.7		(9.0		)	198.3		558.5		625.7		127.3			517.9		296.6			1,014.5		1,567.5
Total Economic Net Income	$	306.4	$	55.5		$	235.5	$	601.9	$	660.4	$	175.7		$	538.5	$	314.8		$	1,199.3	$	1,689.4


(1)	During the fourth quarter of 2013, certain reclassifications were made to prior period financial data within salary, bonus and benefits and profit sharing expense to conform to the current presentation.

APOLLO GLOBAL MANAGEMENT, LLC

SEGMENT RESULTS (UNAUDITED)

(dollars in millions, except share data)

Credit Segment:⁽¹⁾



	Three Months Ended																								Year Ended
	March 31, 2012			June 30, 2012			September 30, 2012			December 31, 2012			March 31, 2013			June 30, 2013			September 30, 2013			December 31, 2013			December 31, 2012			December 31, 2013
Management Business:
Advisory and transaction fees from affiliates, net	$	4.1		$	7.9		$	5.6		$	10.0		$	21.8		$	22.0		$	23.3		$	47.6		$	27.6		$	114.7
Management fees from affiliates	52.6			74.3			80.8			92.0			84.4			90.4			87.0			130.6			299.7			392.4
Carried interest income from affiliates:
Realized gains	9.6			9.2			9.7			9.3			9.0			10.1			9.1			8.7			37.8			36.9
Total management business revenues	66.3			91.4			96.1			111.3			115.2			122.5			119.4			186.9			365.1			544.0
Equity-based compensation	8.1			4.3			6.9			7.7			6.5			7.1			5.9			4.6			27.0			24.1
Salary, bonus and benefits	32.6			36.8			37.4			33.1			38.8			36.4			44.0			33.9			139.9			153.1
Other expenses	25.9			39.2			37.4			46.6			38.4			38.2			34.4			51.1			149.1			162.1
Total management business expenses	66.6			80.3			81.7			87.4			83.7			81.7			84.3			89.6			316.0			339.3
Other income (loss)	2.9			(0.7		)	7.5			5.3			4.5			4.0			15.3			4.7			15.0			28.5
Non-controlling interest	(1.4		)	(2.4		)	(2.7		)	(2.2		)	(3.5		)	(3.2		)	(2.8		)	(4.5		)	(8.7		)	(14.0		)
Management Business Economic Net Income	1.2			8.0			19.2			27.0			32.5			41.6			47.6			97.5			55.4			219.2
Incentive Business:
Carried interest income (loss):
Unrealized gains (losses)	148.3			(16.7		)	187.0			(17.5		)	73.2			(58.8		)	(10.3		)	(60.7		)	301.1			(56.6		)
Realized gains	26.0			10.0			41.6			102.3			51.5			102.1			104.8			134.9			179.9			393.3
Total carried interest income (loss)	174.3			(6.7		)	228.6			84.8			124.7			43.3			94.5			74.2			481.0			336.7
Profit sharing expense:
Unrealized profit sharing expense	24.7			(2.9		)	51.1			2.5			16.5			(15.5		)	34.5			12.4			75.4			47.9
Realized profit sharing expense	11.7			3.9			16.1			31.2			18.8			33.9			30.2			11.9			62.9			94.8
Total profit sharing expense	36.4			1.0			67.2			33.7			35.3			18.4			64.7			24.3			138.3			142.7
Other income, net	—			—			—			—			—			0.2			2.5			5.8			—			8.5
Net gains (losses) from investment activities	3.4			(13.1		)	2.1			6.5			4.0			(5.7		)	(7.1		)	(3.8		)	(1.1		)	(12.6		)
Income (loss) from equity method investments	17.7			(0.7		)	16.9			12.2			6.9			6.4			6.7			10.7			46.1			30.7
Total other income (loss)	21.1			(13.8		)	19.0			18.7			10.9			0.9			2.1			12.7			45.0			26.6
Incentive Business Economic Net Income (Loss)	159.0			(21.5		)	180.4			69.8			100.3			25.8			31.9			62.6			387.7			220.6
Total Economic Net Income (Loss)	$	160.2		$	(13.5	)	$	199.6		$	96.8		$	132.8		$	67.4		$	79.5		$	160.1		$	443.1		$	439.8


(1)	During the fourth quarter of 2013, certain reclassifications were made to prior period financial data within salary, bonus and benefits and profit sharing expense to conform to the current presentation.

APOLLO GLOBAL MANAGEMENT, LLC

SEGMENT RESULTS (UNAUDITED)

(dollars in millions, except share data)

Real Estate Segment:⁽¹⁾



	Three Months Ended																								Year Ended
	March 31, 2012			June 30, 2012			September 30, 2012			December 31, 2012			March 31, 2013			June 30, 2013			September 30, 2013			December 31, 2013			December 31, 2012			December 31, 2013
Management Business:
Advisory and transaction fees from affiliates, net	$	—		$	0.6		$	—		$	0.1		$	1.1		$	1.3		$	—		$	1.1		$	0.7		$	3.5
Management fees from affiliates	10.4			12.9			10.9			12.1			13.6			13.2			13.4			13.2			46.3			53.4
Total management business revenues	10.4			13.5			10.9			12.2			14.7			14.5			13.4			14.3			47.0			56.9
Equity-based compensation	3.0			2.4			2.6			2.7			2.5			2.2			3.1			2.4			10.7			10.2
Salary, bonus and benefits	7.3			6.4			8.0			9.0			7.2			7.1			9.4			8.2			30.7			31.9
Other expenses	6.7			6.2			4.4			6.9			7.3			6.0			7.1			7.1			24.2			27.5
Total management business expenses	17.0			15.0			15.0			18.6			17.0			15.3			19.6			17.7			65.6			69.6
Other income (loss)	0.8			(0.6		)	0.7			0.4			1.1			0.3			0.8			0.2			1.3			2.4
Management Business Economic Net Loss	(5.8		)	(2.1		)	(3.4		)	(6.0		)	(1.2		)	(0.5		)	(5.4		)	(3.2		)	(17.3		)	(10.3		)
Incentive Business:
Carried interest income:
Unrealized gains (losses)	—			1.6			4.8			4.0			0.6			(6.4		)	3.3			7.2			10.4			4.7
Realized gains	1.7			2.6			—			0.4			0.3			0.2			—			—			4.7			0.5
Total carried interest income	1.7			4.2			4.8			4.4			0.9			(6.2		)	3.3			7.2			15.1			5.2
Profit sharing expense:
Unrealized profit sharing expense	—			1.2			3.4			2.1			0.3			(4.5		)	1.8			2.1			6.7			(0.3		)
Realized profit sharing expense	0.7			1.1			—			(1.6		)	0.2			—			—			0.2			0.2			0.4
Total profit sharing expense	0.7			2.3			3.4			0.5			0.5			(4.5		)	1.8			2.3			6.9			0.1
Income (Loss) from equity method investments	0.2			0.2			0.3			0.3			(0.1		)	0.8			0.8			2.2			1.0			3.7
Incentive Business Economic Net Income (Loss)	1.2			2.1			1.7			4.2			0.3			(0.9		)	2.3			7.1			9.2			8.8
Total Economic Net (Loss) Income	$	(4.6	)	$	—		$	(1.7	)	$	(1.8	)	$	(0.9	)	$	(1.4	)	$	(3.1	)	$	3.9		$	(8.1	)	$	(1.5	)


(1)	During the fourth quarter of 2013, certain reclassifications were made to prior period financial data within salary, bonus and benefits and profit sharing expense to conform to the current presentation.

APOLLO GLOBAL MANAGEMENT, LLC

RECONCILIATION OF U.S. GAAP NET INCOME (LOSS) ATTRIBUTABLE TO APOLLO GLOBAL MANAGEMENT TO ECONOMIC NET INCOME

(UNAUDITED)

(dollars in millions)

Reconciliation of U.S. GAAP Net Income (Loss) Attributable to Apollo Global Management, LLC to Economic Net Income:



	Three Months Ended																	Year Ended
	March 31, 2012		June 30, 2012			September 30, 2012		December 31, 2012		March 31, 2013		June 30, 2013		September 30, 2013		December 31, 2013		December 31, 2012		December 31, 2013
Net Income (Loss) Attributable to Apollo Global Management, LLC	$	98.0	$	(41.3	)	$	82.7	$	171.6	$	249.0	$	58.7	$	192.5	$	159.2	$	311.0	$	659.4
Impact of non-cash charges related to equity-based compensation:
AOG units	116.2		116.1			116.2		132.4		15.0		15.0		—		—		480.9		30.0
RSUs - Private placement awards⁽¹⁾	13.3		11.0			10.9		10.9		11.4		11.0		3.3		0.1		46.1		25.8
ARI restricted stock awards, ARI RSUs and AMTG RSUs	0.4		0.4			0.5		0.4		1.3		0.5		0.6		0.4		1.7		2.8
AAA RDUs	0.1		0.3			0.3		0.3		0.3		0.2		0.3		0.4		1.0		1.2
Total non-cash charges related to equity-based compensation	130.0		127.8			127.9		144.0		28.0		26.7		4.2		0.9		529.7		59.8
Income tax provision	14.6		10.6			21.9		18.3		18.6		18.1		47.2		23.7		65.4		107.6
Amortization of intangible assets associated with the 2007 reorganization and acquisitions	6.1		9.6			13.7		13.6		11.6		11.3		10.3		10.0		43.0		43.2
Net income (loss) attributable to Non-controlling Interests in Apollo Operating Group	213.3		(64.7		)	187.3		349.4		485.2		126.5		360.8		285.2		685.3		1,257.7
Economic Net Income	$	462.0	$	42.0		$	433.5	$	696.9	$	792.4	$	241.3	$	615.0	$	479.0	$	1,634.4	$	2,127.7


(1)	Represents RSU awards granted in connection with the 2007 private placement.

APOLLO GLOBAL MANAGEMENT, LLC

ASSETS UNDER MANAGEMENT

(UNAUDITED)

Assets Under Management—Fee-Generating and Non-Fee Generating

The table below sets forth fee-generating and non-fee generating AUM by segment as of December 31, 2013, 2012 and 2011. Changes in market conditions, the additional funds raised and strategic acquisitions have had significant impacts to our AUM.



	As of December 31,
	2013			2012			2011
	(in millions)
Total Assets Under Management	$	161,177	⁽¹⁾	$	113,379	⁽¹⁾	$	75,222
Fee-generating	128,368			81,934			58,121
Non-fee generating	32,809		⁽¹⁾	31,445		⁽¹⁾	17,101

Private Equity	49,908			37,832			35,384
Fee-generating	34,173			27,932			28,031
Non-fee generating	15,735			9,900			7,353

Credit	100,886			64,406			31,867
Fee-generating	88,249			49,518			26,553
Non-fee generating	12,637			14,888			5,314

Real Estate	9,289			8,800		⁽²⁾	7,971
Fee-generating	5,946			4,484		⁽²⁾	3,537
Non-fee generating	3,343			4,316		⁽²⁾	4,434


(1)	As of December 31, 2013 and 2012, includes $1.1 billion and $2.3 billion of commitments, respectively, that have yet to be deployed to an Apollo fund within our three segments.


(2)	Includes fee-generating and non-fee generating AUM as of September 30, 2012 for certain publicly traded vehicles managed by Apollo.

APOLLO GLOBAL MANAGEMENT, LLC

ASSETS UNDER MANAGEMENT

(UNAUDITED)

The following tables summarize changes in total AUM and total AUM for each of our segments for the three months ended December 31, 2013 and 2012 and the years ended December 31, 2013, 2012, and 2011:



	For the Three Months Ended December 31,								For the Year Ended December 31,
	2013				2012				2013				2012				2011
	(in millions)
Change in Total AUM:
Beginning of Period	$	112,687		⁽¹⁾	$	109,702		⁽¹⁾	$	113,379		⁽²⁾	$	75,222			$	67,551
Income (Loss)	3,489				3,587				15,150				12,038				(1,477		)
Subscriptions/Capital raised	9,994				1,558				22,142				9,688				3,797
Other inflows/Acquisitions	43,832				3,701				43,832				23,629				9,355
Distributions	(5,800		)		(4,909		)		(22,641		)		(10,858		)		(5,153		)
Redemptions	(386		)		(185		)		(1,508		)		(1,221		)		(532		)
Leverage	(2,639		)		(75		)		(9,177		)		4,881				1,681
End of Period	$	161,177		⁽²⁾	$	113,379		⁽²⁾	$	161,177		⁽²⁾	$	113,379		⁽²⁾	$	75,222
Change in Private Equity AUM:
Beginning of Period	$	42,767			$	38,983			$	37,832			$	35,384			$	38,799
Income (Loss)	2,010				2,343				10,656				8,108				(1,612		)
Subscriptions/Capital raised	8,443				387				17,613				662				417
Distributions	(3,839		)		(3,521		)		(15,620		)		(6,537		)		(3,464		)
Redemptions⁽³⁾	(157		)		—				(176		)		—				—
Net segment transfers	1,015				50				2,133				317				167
Leverage	(331		)		(410		)		(2,530		)		(102		)		1,077
End of Period	$	49,908			$	37,832			$	49,908			$	37,832			$	35,384
Change in Credit AUM:
Beginning of Period	$	59,359			$	60,107			$	64,406			$	31,867			$	22,283
Income (Loss)	1,195				993				4,082				3,274				(110		)
Subscriptions/Capital raised	1,449				1,169				3,439				5,504				3,094
Other inflows/Acquisitions	43,832				3,701				43,832				23,629				9,355
Distributions	(1,249		)		(1,319		)		(5,458		)		(3,197		)		(1,237		)
Redemptions	(229		)		(185		)		(1,042		)		(948		)		(532		)
Net segment transfers	(1,377		)		(285		)		(2,056		)		(1,023		)		(1,353		)
Leverage	(2,094		)		225				(6,317		)		5,300				367
End of Period	$	100,886			$	64,406			$	100,886			$	64,406			$	31,867
Change in Real Estate AUM:
Beginning of Period	$	9,339			$	8,129			$	8,800			$	7,971			$	6,469
Income	283				251				399				656				245
Subscriptions/Capital raised	102				2				1,090				475				286
Distributions	(712		)		(69		)		(1,559		)		(1,124		)		(452		)
Redemptions ⁽³⁾	—				—				(290		)		(273		)		—
Net segment transfers	491				377				1,179				1,412				1,186
Leverage	(214		)		110				(330		)		(317		)		237
End of Period	$	9,289			$	8,800			$	9,289			$	8,800			$	7,971


(1)	Includes $1.2 billion and $2.5 billion of commitments that have yet to be deployed to an Apollo fund within our three segments at the end of the third quarter 2013 and 2012, respectively.


(2)	As of December 31, 2013 and 2012, includes $1.1 billion and $2.3 billion of commitments, respectively, that have yet to be deployed to an Apollo fund within our three segments.


(3)	Represents release of unfunded commitments primarily related to Fund III and several legacy Citi Property Investors ("CPI") real estate funds that were past their investment periods.

APOLLO GLOBAL MANAGEMENT, LLC

ASSETS UNDER MANAGEMENT

(UNAUDITED)

The following tables summarize changes in total fee-generating AUM and fee-generating AUM for each of our segments for the three months ended December 31, 2013 and 2012 and the years ended December 31, 2013, 2012, and 2011:



	For the Three Months Ended December 31,						For the Year Ended December 31,
	2013			2012			2013			2012			2011
	(in millions)						(in millions)
Change in Total Fee-Generating AUM:
Beginning of Period	$	79,343		$	77,676		$	81,934		$	58,121		$	47,037
Income (Loss)	111			749			2,100			1,390			(393		)
Subscriptions/Capital raised	8,701			1,522			21,104			5,873			2,547
Other inflows/Acquisitions	43,832			3,701			43,832			21,277			9,355
Distributions	(2,500		)	(1,308		)	(7,517		)	(3,728		)	(734		)
Redemptions	(209		)	(171		)	(946		)	(909		)	(481		)
Net movements between Fee-Generating and Non-Fee Generating	593			(18		)	(6,215		)	(564		)	761
Leverage	(1,503		)	(217		)	(5,924		)	474			29
End of Period	$	128,368		$	81,934		$	128,368		$	81,934		$	58,121
Change in Private Equity Fee-Generating AUM:
Beginning of Period	$	27,059		$	28,146		$	27,932		$	28,031		$	27,874
Income (Loss)	50			153			398			285			(112		)
Subscriptions/Capital raised	7,953			376			17,582			644			410
Distributions	(1,404		)	(540		)	(3,430		)	(1,256		)	(272		)
Redemptions	—			—			(19		)	—			—
Net segment transfers	236			50			482			50			(88		)
Net movements between Fee-Generating and Non-Fee Generating	665			155			(6,858		)	515			285
Leverage	(386		)	(408		)	(1,914		)	(337		)	(66		)
End of Period	$	34,173		$	27,932		$	34,173		$	27,932		$	28,031
Change in Credit Fee-Generating AUM:
Beginning of Period	$	46,625		$	45,302		$	49,518		$	26,553		$	16,484
Income	27			539			1,630			988			301
Subscriptions/Capital raised	646			1,144			2,504			4,953			1,795
Other inflows/Acquisitions	43,832			3,701			43,832			21,277			9,355
Distributions	(740		)	(707		)	(3,118		)	(2,029		)	(283		)
Redemptions	(209		)	(171		)	(927		)	(909		)	(481		)
Net segment transfers	(727		)	(377		)	(1,611		)	(1,096		)	(638		)
Net movements between Fee-Generating and Non-Fee Generating	(88		)	(104		)	431			(1,030		)	356
Leverage	(1,117		)	191			(4,010		)	811			(336		)
End of Period	$	88,249		$	49,518		$	88,249		$	49,518		$	26,553
Change in Real Estate Fee-Generating AUM:
Beginning of Period	$	5,659		$	4,228		$	4,484		$	3,537		$	2,679
Income (Loss)	34			57			72			117			(582		)
Subscriptions/Capital raised	102			2			1,018			276			342
Distributions	(356		)	(61		)	(969		)	(443		)	(179		)
Net segment transfers	491			327			1,129			1,045			726
Net movements between Fee-Generating and Non-Fee Generating	16			(69		)	212			(48		)	120
Leverage	—			—			—			—			431
End of Period	$	5,946		$	4,484		$	5,946		$	4,484		$	3,537

APOLLO GLOBAL MANAGEMENT, LLC

FUND PERFORMANCE (UNAUDITED)

Investment Record

Private Equity

The following table summarizes the investment record of our private equity funds. All amounts are as of December 31, 2013, unless otherwise noted:



												As of December 31, 2013						As of December 31, 2012						As of December 31, 2011
	Vintage Year	Committed Capital		Total Invested Capital		Realized		Unrealized⁽¹⁾		Total Value		Gross IRR			Net IRR			Gross IRR			Net IRR			Gross IRR			Net IRR
		(in millions)
Fund VIII⁽²⁾	2013	$	18,377	$	100	$	—	$	100	$	100	NM		⁽³⁾	NM		⁽³⁾	N/A			N/A			N/A			N/A
AION⁽²⁾	—	376		55		—		57		57		NM		⁽³⁾	NM		⁽³⁾	NM		⁽³⁾	NM		⁽³⁾	N/A			N/A
ANRP	2012	1,323		370		19		437		456		18	%		7	%		NM		⁽³⁾	NM		⁽³⁾	NM		⁽³⁾	NM		⁽³⁾
Fund VII	2008	14,676		14,979		19,569		10,843		30,412		39			30			35	%		26	%		31	%		22	%
Fund VI	2006	10,136		12,457		12,541		9,551		22,092		15			12			11			9			6			5
Fund V	2001	3,742		5,192		12,385		463		12,848		61			44			61			44			61			44
Fund IV	1998	3,600		3,481		6,776		38		6,814		12			9			12			9			12			9
Fund III	1995	1,500		1,499		2,695		—		2,695		18			11			18			11			18			12
Fund I, II & MIA⁽⁴⁾	1990/92	2,220		3,773		7,924		—		7,924		47			37			47			37			47			37
Totals		$	55,950	$	41,906	$	61,909	$	21,489	$	83,398	39%		⁽⁵⁾	26%		⁽⁵⁾	39%		⁽⁵⁾	25%		⁽⁵⁾	39	%	⁽⁵⁾	25	%	⁽⁵⁾



		Current Net Asset Value as of December 31, 2013	Total Return
	Vintage Year	Current Net Asset Value as of December 31, 2013	For the Year Ended December 31, 2013		For the Year Ended December 31, 2012		For the Year Ended December 31, 2011
		(in millions)
AAA⁽⁶⁾	2006	$1,941.2	21	%	20	%	(8	)%


(1)	Figures include the market values, estimated fair value of certain unrealized investments and capital committed to investments.


(2)	Fund VIII and AION Capital Partners Limited ("AION") were launched during 2013 and 2012, respectively. Fund VIII had its final capital raise in 2013, establishing its vintage year.


(3)	Returns have not been presented as the fund commenced investing capital less than 24 months prior to the period indicated and therefore such return information was deemed not meaningful.

(4)

Fund I and Fund II were structured such that investments were made from either fund depending on which fund had available capital. We do not differentiate between Fund I and Fund II investments for purposes of performance figures because they are not meaningful on a separate basis and do not demonstrate the progression of returns over time. The general partners and managers of Funds I, II and MIA, as well as the general partner of Fund III were excluded assets in connection with the 2007 reorganization of Apollo. As a result, Apollo Global Management, LLC did not receive the economics associated with these entities. The investment performance of these funds is presented to illustrate fund performance associated with our managing partners and other investment professionals.


(5)	Total IRR is calculated based on total cash flows for all funds presented.

(6)

AAA completed its initial public offering in June 2006 and is the sole limited partner in AAA Investments, L.P. (“AAA Investments”). AAA was originally designed to give investors in its common units exposure as a limited partner to certain of the strategies that we employ and allowed us to manage the asset allocations to those strategies by investing alongside our private equity funds and directly in our credit funds and certain other opportunistic investments that we sponsor and manage. On October 31, 2012, AAA Investments consummated a transaction whereby substantially all of its assets were contributed to Athene in exchange for common shares of Athene Holding Ltd., cash and a short term promissory note (the “AAA Transaction”). After the AAA Transaction, Athene was AAA’s only material investment and as of December 31, 2013, AAA, through its investment in AAA Investments, was the largest shareholder of Athene Holding Ltd. with an approximate 72.5% ownership stake (without giving effect to restricted common shares issued under Athene’s management equity plan and conversion of AAA Investments' note receivable), and effectively 45% of the voting power of Athene. Additional information related to AAA can be found on its website www.apolloalternativeassets.com. The information contained in AAA’s website is not part of this press release.

APOLLO GLOBAL MANAGEMENT, LLC

FUND PERFORMANCE (UNAUDITED)

Credit

The following table summarizes the investment record for certain funds and strategic investment accounts (“SIAs”) with a defined maturity date and internal rate of return since inception, which is computed for the purposes of this table based on the actual dates of capital contributions, distributions and ending limited partners’ capital as of the specified date. Apollo also manages collateralized loan obligations (“CLOs”) within our credit segment, which had total AUM of approximately $9.4 billion as of December 31, 2013. Such CLO performance information is not included in the following credit investment record tables. All amounts are as of December 31, 2013, unless otherwise noted:



													As of December 31, 2013						As of December 31, 2012						As of December 31, 2011
	Strategy	Vintage Year	Committed Capital		Total Invested Capital		Realized		Unrealized⁽¹⁾		Total Value		Gross IRR			Net IRR			Gross IRR			Net IRR			Gross IRR			Net IRR
			(in millions)
ACRF II⁽²⁾	Structured Credit	2012	$	104.4	$	202.3	$	103.9	$	111.4	$	215.3	NM		⁽⁴⁾	NM		⁽⁴⁾	NM		⁽⁴⁾	NM		⁽⁴⁾	NM		⁽⁴⁾	NM		⁽⁴⁾
EPF II⁽³⁾⁽⁵⁾	Non-Performing Loans	2012	3,662.4		1,021.8		44.3		1,153.1		1,197.4		NM		⁽⁴⁾	NM		⁽⁴⁾	NM		⁽⁴⁾	NM		⁽⁴⁾	NM		⁽⁴⁾	NM		⁽⁴⁾
FCI⁽³⁾	Structured Credit	2012	558.8		443.2		170.5		457.6		628.1		NM		⁽⁴⁾	NM		⁽⁴⁾	NM		⁽⁴⁾	NM		⁽⁴⁾	NM		⁽⁴⁾	NM		⁽⁴⁾
AESI⁽³⁾⁽⁵⁾	European Credit	2011	488.6		808.2		553.0		365.6		918.6		23.2	%		17.7	%		NM		⁽⁴⁾	NM		⁽⁴⁾	NM		⁽⁴⁾	NM		⁽⁴⁾
AEC⁽³⁾	European Credit	2012	292.5		461.9		316.0		204.3		520.3		18.8			11.9			NM		⁽⁴⁾	NM		⁽⁴⁾	NM		⁽⁴⁾	NM		⁽⁴⁾
AIE II⁽⁵⁾	European Credit	2008	283.8		895.9		1,299.6		126.2		1,425.8		20.3			16.8			19.4	%		15.6	%		18.2	%		14.2	%
COF I	U.S. Performing Credit	2008	1,484.9		1,611.3		3,842.4		544.2		4,386.6		30.4			27.4			30.7			27.6			25.0			22.4
COF II	U.S. Performing Credit	2008	1,583.0		2,176.4		2,783.4		346.4		3,129.8		13.8			11.2			14.3			11.7			10.3			8.5
EPF I⁽⁵⁾	Non-Performing Loans	2007	1,779.7		2,338.7		2,108.8		2,017.4		4,126.2		21.2			16.4			18.6			11.6			16.6			8.8
ACLF	U.S. Performing Credit	2007	984.0		1,448.5		2,420.3		122.4		2,542.7		13.0			11.3			13.0			11.2			10.1			9.2
Artus⁽⁶⁾	U.S. Performing Credit	2007	106.6		190.1		225.9		—		225.9		6.9			6.7			7.0			6.8			3.6			3.4
Totals			$	11,328.7	$	11,598.3	$	13,868.1	$	5,448.6	$	19,316.7


(1)	Figures include the market values, estimated fair value of certain unrealized investments and capital committed to investments.


(2)	As part of the acquisition of Stone Tower Capital, LLC (“Stone Tower”), Apollo acquired the manager of Apollo Structured Credit Recovery Master Fund II, Ltd. (“ACRF II”). Apollo became the manager of this fund upon completing the acquisition on April 2, 2012.

(3)

Apollo European Strategic Investment, L.P. (“AESI”) was launched during 2011 and established its vintage year in the fourth quarter of 2011. Apollo European Principal Finance Fund II, L.P. (“EPF II”), Apollo European Credit Master Fund, L.P, ("AEC"), and Financial Credit Investment I, L.P. (“FCI”) deployed capital prior to their vintage year and had their final capital raises in 2012, establishing their vintage year.


(4)	Returns have not been presented as the fund commenced investing capital less than 24 months prior to the period indicated and therefore such return information was deemed not meaningful.


(5)	Funds are denominated in Euros and translated into U.S. dollars at an exchange rate of €1.00 to $1.37 as of December 31, 2013.


(6)	Apollo/ Artus Investors 2007-I, L.P. ("Artus") liquidated during the fourth quarter of 2013. Amounts presented represent the historical performance and returns for the fund.

APOLLO GLOBAL MANAGEMENT, LLC

FUND PERFORMANCE (UNAUDITED)

The following table summarizes the investment record for certain funds and SIAs with no maturity date. All amounts are as of December 31, 2013, unless otherwise noted:

Net Return

Strategy

Vintage Year

Net Asset Value as of December 31, 2013

Since Inception to December 31, 2013

For the Year Ended December 31, 2013

For the Year Ended December 31, 2012

For the Year Ended December 31, 2011

(in millions)

ACSP⁽¹⁾

Opportunistic Credit

2012

272.7

⁽²⁾

ACSF⁽³⁾

Opportunistic Credit

2011

284.8

⁽³⁾

STCS⁽³⁾

Opportunistic Credit

2010

19.3

⁽³⁾

SOMA⁽⁴⁾

Opportunistic Credit

2007

673.8

58.4

9.3

15.1

(10.5

ACF⁽³⁾

U.S. Performing Credit

2005

2,189.8

⁽³⁾

Value Funds⁽⁵⁾

Opportunistic Credit

2003/2006

288.8

74.1

4.7

10.8

(9.6

)

Totals

3,729.2


(1)	Apollo Centre Street Partnership, L.P. (“ACSP”) is a strategic investment account with $615.0 million of committed capital. Net asset value is presented for the primary mandate and excludes investments in other Apollo funds.


(2)	Returns have not been presented as the fund commenced investing capital less than 24 months prior to the period indicated and therefore such return information was deemed not meaningful.

(3)

As part of the Stone Tower acquisition, Apollo acquired the manager of Apollo Credit Strategies Master Fund Ltd. (“ACSF”), Stone Tower Credit Solutions Master Fund Ltd. (“STCS”), and Apollo Credit Master Fund Ltd. (“ACF”). As of December 31, 2013, the net returns from inception for ACSF, ACF and STCS were 37.8%, 3.2%, and 36.2% respectively. These returns were primarily achieved during a period in which Apollo did not make the initial investment decisions. Apollo became the manager of these funds upon completing the acquisition on April 2, 2012.


(4)	Net asset value and returns are for the primary mandate and excludes Apollo Special Opportunities Managed Account, L.P.’s (“SOMA”) investments in other Apollo funds.


(5)	Value Funds consist of Apollo Strategic Value Master Fund, L.P., together with its feeder funds, and Apollo Value Investment Master Fund, L.P., together with its feeder funds.

The following table summarizes the investment record for our publicly traded vehicles in our credit segment as of December 31, 2013:



									Net Returns
	Strategy	IPO Year⁽¹⁾	Raised Capital⁽²⁾		Gross Assets		Current Net Asset Value		Since Inception to December 31, 2013			For the Year Ended December 31, 2013			For the Year Ended December 31, 2012			For the Year Ended December 31, 2011
		(in millions)
AIF⁽³⁾	U.S. Performing Credit	2013	$	275.7	$	420.2	$	282.2	NM		⁽⁴⁾	NM		⁽⁴⁾	NM		⁽⁴⁾	NM		⁽⁴⁾
AFT⁽³⁾	U.S. Performing Credit	2011	294.6		451.1		297.7		21.7	%		9.2	%		NM		⁽⁴⁾	NM		⁽⁴⁾
AMTG⁽⁵⁾	Structured Credit	2011	790.7		3,771.1		765.0		N/A		⁽⁵⁾	N/A		⁽⁵⁾	N/A		⁽⁵⁾	N/A		⁽⁵⁾
AINV⁽⁶⁾	Opportunistic Credit	2004	2,977.7		3,379.7		1,925.3		70.2			15.7			9.9	%		(5.1	)%
Totals			$	4,338.7	$	8,022.1	$	3,270.2

(1)

An initial public offering ("IPO") year represents the year in which the vehicle commenced trading on a national securities exchange. Apollo Tactical Income Fund Inc. (“AIF”), Apollo Senior Floating Rate Fund Inc. ("AFT"), and Apollo Residential Mortgage, Inc. ("AMTG") are publicly traded vehicles traded on the New York Stock Exchange ("NYSE"). Apollo Investment Corporation ("AINV") is a public company traded on the National Association of Securities Dealers Automated Quotation ("NASDAQ").


(2)	Amounts represent raised capital net of offering and issuance costs.


(3)	AFT and AIF completed their initial public offerings during the first quarter of 2011 and 2013, respectively. Gross Assets represents total managed assets of these closed-end funds. Refer to www.agmfunds.com for the most recent financial information on AFT and AIF. The information contained on AFT’s and AIF’s website is not part of this press release.


(4)	Returns have not been presented as the publicly traded vehicle commenced investing capital less than 24 months prior to the period indicated and therefore such return information was deemed not meaningful.


(5)	Refer to www.apolloresidentialmortgage.com for the most recent financial information on AMTG. The information contained in AMTG’s website is not part of this press release. All amounts are as of September 30, 2013.


(6)	Net return for AINV represents net asset value return including reinvested dividends. Refer to www.apolloic.com for the most recent public financial information on AINV. The information contained in AINV’s website is not part of this press release.

APOLLO GLOBAL MANAGEMENT, LLC

FUND PERFORMANCE (UNAUDITED)

Real Estate

The following table summarizes the investment record for certain funds and SIAs with a defined maturity date and internal rate of return since inception, which for the purposes of this table is computed based on the actual dates of capital contributions, distributions and ending limited partners’ capital as of the specified date. All amounts are as of December 31, 2013, unless otherwise noted:



																		As of December 31, 2013						As of December 31, 2012						As of December 31, 2011
	Vintage Year	Committed Capital		Current Net Asset Value		Total Invested Capital			Realized			Unrealized⁽¹⁾			Total Value			Gross IRR			Net IRR			Gross IRR			Net IRR			Gross IRR		Net IRR
		(in millions)
AGRE U.S. Real Estate Fund, L.P⁽³⁾	2012	$	866.6	$	547.3	$	435.9		$	4.1		$	544.1		$	548.2		17.3	%		13.7	%		NM		⁽²⁾	NM		⁽²⁾	NM	⁽²⁾	NM	⁽²⁾
AGRE Debt Fund I, LP	2011	816.4		736.1		812.2			173.5			731.1			904.6			13.1			11.1			NM		⁽²⁾	NM		⁽²⁾	NM	⁽²⁾	NM	⁽²⁾
2011 A4 Fund, L.P.	2011	234.7		210.7		205.9			83.6			203.8			287.4			13.5			11.7			NM		⁽²⁾	NM		⁽²⁾	NM	⁽²⁾	NM	⁽²⁾
AGRE CMBS Fund, L.P.	2009	418.8		67.1		301.0			447.0			63.1			510.1			13.5			11.3			14.1	%		11.8	%		NM	⁽²⁾	NM	⁽²⁾
CPI Capital Partners North America	2006	600.0		65.2		452.7			318.5			60.5			379.0			17.1		⁽⁴⁾	13.0		⁽⁴⁾	NM		⁽⁴⁾	NM		⁽⁴⁾	NM	⁽²⁾	NM	⁽²⁾
CPI Capital Partners Asia Pacific	2006	1,291.6		253.5		1,163.6			1,454.8			231.2			1,686.0			36.7		⁽⁴⁾	32.6		⁽⁴⁾	NM		⁽⁴⁾	NM		⁽⁴⁾	NM	⁽²⁾	NM	⁽²⁾
CPI Capital Partners Europe⁽⁵⁾	2006	1,596.9		583.7		1,053.9			182.4			549.0			731.4			2.4		⁽⁴⁾	0.6		⁽⁴⁾	NM		⁽⁴⁾	NM		⁽⁴⁾	NM	⁽²⁾	NM	⁽²⁾
CPI Other⁽⁶⁾	Various	2,403.8		868.8		N/A		⁽⁶⁾	N/A		⁽⁶⁾	N/A		⁽⁶⁾	N/A		⁽⁶⁾	NM		⁽⁶⁾	NM		⁽⁶⁾	NM		⁽⁶⁾	NM		⁽⁶⁾	NM	⁽²⁾	NM	⁽²⁾
Totals		$	8,228.8	$	3,332.4	$	4,425.2		$	2,663.9		$	2,382.8		$	5,046.7


(1)	Figures include estimated fair value of unrealized investments.


(2)	Returns have not been presented as the fund commenced investing capital less than 24 months prior to the period indicated and therefore such return information was deemed not meaningful.

(3)

AGRE U.S. Real Estate Fund, L.P., a closed-end private investment fund that intends to make real estate-related investments principally located in the United States, held closings in January 2011, June 2011 and April 2012 for a total of $263.2 million in base capital commitments and $450 million in additional capital commitments. Additionally, there was $153.4 million of co-invest commitments raised, which is included in the figures in the table above. A co-invest entity within AGRE U.S. Real Estate Fund is denominated in GBP and translated into U.S. dollars at an exchange rate of £1.00 to $1.66 as of December 31, 2013.

(4)

As part of the CPI acquisition, Apollo acquired general partner interests in fully invested funds. The gross and net IRRs are presented in the investment record table above since acquisition on November 12, 2010. The net IRRs from the inception of the respective fund to December 31, 2013 were (6.8)%, 7.9% and (9.7)% for the CPI Capital Partners North America, Asia Pacific and Europe funds, respectively. These net IRRs were primarily achieved during a period in which Apollo did not make the initial investment decisions and Apollo only became the general partner or manager of these funds upon completing the acquisition on November 12, 2010.


(5)	CPI Capital Partners Europe is denominated in Euros and translated into U.S. dollars at an exchange rate of €1.00 to $1.37 as of December 31, 2013.

(6)

CPI Other consists of funds or individual investments of which we are not the general partner or manager and only receive fees pursuant to either a sub-advisory agreement or an investment management and administrative agreement. CPI Other fund performance is a result of invested capital prior to Apollo’s management of these funds. Return and certain other performance data are therefore not considered meaningful as we perform primarily an administrative role.

The following table summarizes the investment record for Apollo Commercial Real Estate Finance, Inc. (“ARI”) as of September 30, 2013:



	IPO Year	Raised Capital	Gross Assets	Current Net Asset Value
	(in millions)
ARI⁽¹⁾	2009	$714.6	$952.8	$682.9


(1)	ARI is a public company traded on the NYSE. Refer to www.apolloreit.com for the most recent financial information on ARI. The information contained in ARI’s website is not part of this press release.

APOLLO GLOBAL MANAGEMENT, LLC

SUPPLEMENTAL SEGMENT INFORMATION (UNAUDITED)

Athene and SIAs

As of December 31, 2013, Athene Asset Management, L.P. had $59.5 billion of total AUM in accounts owned by or related to Athene, of which approximately $9.2 billion, was either sub-advised by Apollo or invested in Apollo funds and investment vehicles. Of the approximately $9.2 billion of assets, the vast majority were in sub-advisory managed accounts that manage high grade credit asset classes, such as CLO debt, commercial mortgage backed securities, and insurance-linked securities.

In addition to certain funds and SIAs included in the investment record tables and capital deployed from certain SIAs across our private equity, credit and real estate funds, we also managed an additional approximate $7.2 billion of total AUM in SIAs as of December 31, 2013. The above investment record tables exclude certain funds and SIAs with an aggregate AUM of approximately $5.7 billion as of December 31, 2013, which were excluded because management deemed them to be immaterial.

Supplemental Segment Information

Private Equity Dollars Invested and Uncalled Commitments

The following table summarizes the private equity dollars invested during the specified reporting periods:



	For the Three Months Ended December 31,				For the Year Ended December 31,
	2013		2012		2013		2012		2011
	(in millions)
Private equity dollars invested	$	1,073	$	472	$	2,561	$	3,191	$	3,350

The following table summarizes the uncalled private equity commitments as of December 31, 2013, 2012, and 2011:



	As of December 31,
	2013		2012		2011
	(in millions)
Uncalled private equity commitments	$	23,689	$	7,464	$	8,204

Cost and Fair Value of our Funds’ Investments by Segment

The following table provides a summary of the cost and fair value of our funds’ investments by segment:



	As of December 31, 2013		⁽¹⁾	As of December 31, 2012		⁽¹⁾	As of December 31, 2011
	(in millions)
Private Equity:
Cost	$	14,213		$	16,927		$	15,956
Fair Value	23,432			25,867			20,700
Credit:
Cost	$	15,516	⁽²⁾	$	15,097	⁽³⁾	$	10,917
Fair Value	16,527		⁽²⁾	16,287		⁽³⁾	11,696
Real Estate:
Cost	$	4,240	⁽²⁾	$	3,848	⁽³⁾	$	4,791
Fair Value	4,154		⁽²⁾	3,680		⁽³⁾	4,344


(1)	Cost and fair value amounts are presented for investments of the funds that are listed in the investment record tables only.


(2)	AMTG and ARI cost and fair value amounts are as of September 30, 2013.


(3)	AMTG and ARI cost and fair value amounts are as of September 30, 2012.

As of December 31, 2013, approximately 70% of the value of our fund investments on a gross basis was determined using market-based valuation methods (i.e., reliance on broker or listed exchange quotes) and the remaining 30% was determined primarily by comparable company and industry multiples or discounted cash flow models. For our private equity, credit and real estate segments, the percentage determined using market-based valuation methods as of December 31, 2013 was 56%, 84% and 48%, respectively.

APOLLO GLOBAL MANAGEMENT, LLC

CARRIED INTEREST RECEIVABLE AND CARRIED INTEREST INCOME

(LOSS) SUMMARY (UNAUDITED)

The table below presents an analysis of our (i) carried interest receivable on an unconsolidated basis and (ii) realized and unrealized carried interest income (loss) for our combined segments’ Incentive Business as of and for the three months and year ended December 31, 2013:



	As of December 31, 2013			For the Three Months Ended December 31, 2013								For the Year Ended December 31, 2013
	Carried Interest Receivable on an Unconsolidated Basis			Unrealized Carried Interest Income (Loss)			Realized Carried Interest Income		Total Carried Interest Income (Loss)			Unrealized Carried Interest Income (Loss)			Realized Carried Interest Income		Total Carried Interest Income (Loss)
	(in millions)
Private Equity Funds:
Fund VII	$	890.8		$	(14.8	)	$	291.8	$	277.0		$	(13.6	)	$	1,163.6	$	1,150.0
Fund VI	697.6			(60.4		)	162.3		101.9			427.3			760.3		1,187.6
Fund V	43.0			3.8			3.2		7.0			(91.2		)	99.1		7.9
Fund IV	7.7			(0.2		)	1.7		1.5			(3.2		)	1.7		(1.5		)
AAA/Other ⁽¹⁾⁽²⁾	228.7			20.1			37.9		58.0			135.4			37.9		173.3
Total Private Equity Funds	1,867.8			(51.5		)	496.9		445.4			454.7			2,062.6		2,517.3
Credit Funds:
U.S. Performing Credit	179.9			(62.6		)	83.9		21.3			(164.1		)	284.6		120.5
Opportunistic Credit	59.8			(20.3		)	27.8		7.5			20.4			36.7		57.1
Structured Credit	54.3			6.7			3.0		9.7			32.7			11.2		43.9
European Credit	35.6			(6.9		)	20.2		13.3			2.1			27.8		29.9
Non-Performing Loans	154.2			22.4			—		22.4			52.3			33.0		85.3
Total Credit Funds	483.8			(60.7		)	134.9		74.2			(56.6		)	393.3		336.7
Real Estate Funds:
CPI Funds	5.3			(1.3		)	—		(1.3		)	(5.2		)	0.5		(4.7		)
AGRE U.S. Real Estate Fund, L.P.	5.6			4.2			—		4.2			5.6			—		5.6
Other	4.3			4.3			—		4.3			4.3			—		4.3
Total Real Estate Funds	15.2			7.2			—		7.2			4.7			0.5		5.2
Total	$	2,366.8	⁽³⁾	$	(105.0	)	$	631.8	$	526.8		$	402.8		$	2,456.4	$	2,859.2


(1)	Includes certain strategic investment accounts.

(2)

Includes $100.9 million of carried interest receivable from AAA Investments' investment in Athene Holding Ltd., which may be settled in shares of Athene Holding Ltd. (valued at the then fair market value) if there is a distribution in kind of shares of Athene Holding Ltd. to the AAA unitholders; in the event there is not a distribution of shares, the receivable will be settled in cash. During the three months and year ended December 31, 2013, the Company earned $18.9 million and $31.9 million, respectively, from AAA Investments' investment in Athene Holding Ltd.


(3)	There was a corresponding profit sharing payable of $992.2 million as of December 31, 2013 that resulted in a net carried interest receivable on an unconsolidated basis of $1,374.6 million as of December 31, 2013. Included within profit sharing payable are contingent consideration obligations of $135.5 million.

APOLLO GLOBAL MANAGEMENT, LLC

SUPPLEMENTAL SHARE INFORMATION (UNAUDITED)

The table below presents Non-GAAP weighted average diluted shares outstanding for the three months and years ended December 31, 2013 and 2012:



	For the Three Months Ended December 31,		For the Year Ended December 31,
	2013	2012	2013	2012
Total GAAP Weighted Average Outstanding Class A Shares:
Basic	145,132,700	130,027,037	139,173,386	127,693,489
Non-GAAP Adjustments:
AOG units	229,968,919	240,000,000	234,108,026	240,000,000
Vested RSUs⁽¹⁾	20,148,390	18,244,210	20,664,694	18,531,106
Non-GAAP Weighted Average Diluted Shares Outstanding	395,250,009	388,271,247	393,946,106	386,224,595


(1)	Vested RSUs presented have not yet been issued in the form of Class A shares. As a result, the amount of vested RSUs indicated has been excluded from the outstanding Class A share basic and diluted amounts.

The table below presents Non-GAAP diluted shares outstanding as of December 31, 2013 and 2012:



	As of December 31,
	2013	2012
Total GAAP Outstanding Class A Shares:
Basic	146,280,784	130,053,993
Non-GAAP Adjustments:
AOG units	228,954,598	240,000,000
Vested RSUs⁽¹⁾	22,793,751	22,512,930
Non-GAAP Diluted Shares Outstanding	398,029,133	392,566,923


(1)	Vested RSUs presented have not yet been issued in the form of Class A shares. As a result, the amount of vested RSUs indicated has been excluded from the outstanding Class A share basic and diluted amounts.

Note: In addition to fully diluted shares outstanding above, there were approximately 3.4 million and 4.4 million unvested RSUs that participate in distributions as of December 31, 2013 and 2012, respectively.

APOLLO GLOBAL MANAGEMENT, LLC

NON-GAAP FINANCIAL INFORMATION AND DEFINITIONS (UNAUDITED)

Non-GAAP Financial Information

Apollo discloses the following financial measures that are calculated and presented on the basis of methodologies other than in accordance with generally accepted accounting principles in the United States of America (“Non-GAAP”):

•

Economic Net Income, or ENI, as well as ENI After Taxes are key performance measures used by management in evaluating the performance of Apollo’s private equity, credit and real estate segments. Management also believes the components of ENI such as the amount of management fees, advisory and transaction fees and carried interest income are indicative of Apollo’s performance. Management uses these performance measures in making key operating decisions such as the following:



	—		Decisions related to the allocation of resources such as staffing decisions including hiring and locations for deployment of the new hires;



	—		Decisions related to capital deployment such as providing capital to facilitate growth for the business and/or to facilitate expansion into new businesses; and



	—		Decisions related to expenses, such as determining annual discretionary bonuses and equity-based compensation awards to its employees. With respect to compensation, management seeks to align the interests of certain professionals and selected other individuals with those of the investors in such funds and those of the company’s shareholders by providing such individuals a profit sharing interest in the carried interest income earned in relation to the funds. To achieve that objective, a certain amount of compensation is based on the company’s performance and growth for the year.

These measures of profitability have certain limitations in that they do not take into account certain items included under U.S. GAAP. ENI represents segment income (loss) attributable to Apollo Global Management, LLC, which excludes the impact of non-cash charges related to RSUs granted in connection with the 2007 private placement and amortization of AOG units, income tax expense, amortization of intangibles associated with the 2007 reorganization as well as acquisitions and Non-controlling Interests excluding the remaining interest held by certain individuals who receive an allocation of income from certain of our credit management companies. In addition, segment data excludes the assets, liabilities and operating results of the funds and VIEs that are included in the consolidated financial statements.

•

ENI After Taxes represents ENI adjusted to reflect income tax provision on ENI that has been calculated assuming that all income is allocated to Apollo Global Management, LLC, which would occur following an exchange of all AOG units for Class A shares of Apollo Global Management, LLC. The assumptions and methodology impact the implied income tax provision which is consistent with those methodologies and assumptions used in calculating the income tax provision for Apollo’s consolidated statements of operations under U.S. GAAP. We believe this measure is more consistent with how we assess the performance of our segments which is described above in our definition of ENI.


•	ENI After Taxes per Share represents ENI After Taxes which is divided by Non-GAAP Weighted Average Diluted Shares Outstanding. We believe ENI After Taxes per Share provides useful information to shareholders because management uses ENI After Taxes per Share as the basis to derive our earnings available for the determination of distributions to Class A shareholders.

APOLLO GLOBAL MANAGEMENT, LLC

NON-GAAP FINANCIAL INFORMATION AND DEFINITIONS (UNAUDITED)

•

Non-GAAP Weighted Average Diluted Shares Outstanding is calculated using the GAAP Weighted Average Outstanding Class A Shares plus Non-GAAP adjustments assuming (i) the exchange of all of the AOG units for 229,968,919 Class A shares and (ii) the settlement of the weighted average vested RSUs in the form of Class A shares during the period. Management uses this measure in determining ENI After Taxes per Share described above.

•

Non-GAAP Diluted Shares Outstanding is calculated using the GAAP Outstanding Class A Shares plus Non-GAAP adjustments assuming (i) the exchange of all of the AOG units for 228,954,598 Class A shares and (ii) the settlement of the vested RSUs in the form of Class A shares during the period. Management uses this measure, taking into account the unvested RSUs that participate in distributions, in determining our Class A shares eligible for cash distributions.

Definitions


•	Assets Under Management, or AUM, 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 of our private equity investments plus the capital that we are entitled to call from our investors pursuant to the terms of their capital commitments to the extent a fund is within the commitment period in which management fees are calculated based on total commitments to the fund;

(ii)

the net asset value of our credit funds, other than certain CLOs, which we measure by using the mark-to-market value of the aggregate principal amount of the underlying collateralized loan obligation) or certain CLO and collateralized debt obligation credit funds that have a fee generating basis other than mark-to-market assets or liabilities, plus used or available leverage and/or capital commitments;


(iii)	the gross asset value or net asset value of our real estate entities and the structured portfolio company investments included within the funds we manage, which includes the leverage used by such structured portfolio companies;


(iv)	the incremental value associated with the reinsurance investments of the portfolio company assets that we manage; and


(v)	the fair value of any other investments that we manage plus unused credit facilities, including capital commitments for investments that may require pre-qualification before investment plus any other capital commitments available for investment that are not otherwise included in the clauses above.

Our AUM measure includes Assets Under Management for which we charge either no or nominal fees. Our definition of AUM is not based on any definition of Assets Under Management contained in our operating agreement or in any of our Apollo fund management agreements. We consider multiple factors for determining what should be included in our definition of AUM. Such factors include but are not limited to (1) our ability to influence the investment decisions for existing and available assets; (2) our ability to generate income from the underlying assets in our funds; and (3) the AUM measures that we use internally or believe are used by other investment managers. Given the differences in the investment strategies and structures among other alternative investment managers, our calculation of AUM may differ from the calculations employed by other investment managers and, as a result, this measure may not be directly comparable to similar measures presented by other investment managers.

APOLLO GLOBAL MANAGEMENT, LLC

NON-GAAP FINANCIAL INFORMATION AND DEFINITIONS (UNAUDITED)

We use AUM as a performance measurement of our investment activities, as well as to monitor fund size in relation to professional resource and infrastructure needs.

•

Fee-generating AUM consists of assets that we manage and on which we earn management fees or monitoring fees pursuant to management agreements on a basis that varies among the Apollo funds. Management fees are normally based on “net asset value,” “gross assets,” “adjusted par asset value,” “adjusted cost of all unrealized portfolio investments,” “capital commitments,” “adjusted assets,” “stockholders’ equity,” “invested capital” or “capital contributions,” each as defined in the applicable management agreement. Monitoring fees, also referred to as advisory fees, are generally based on the total value of certain structured portfolio company investments, which normally include leverage, less any portion of such total value that is already considered in fee-generating AUM.


•	Non-fee generating AUM consists of assets that do not produce management fees or monitoring fees. These assets generally consist of the following:


(i)	fair value above invested capital for those funds that earn management fees based on invested capital;


(ii)	net asset values related to general partner and co-investment ownership;


(iii)	unused credit facilities;


(iv)	available commitments on those funds that generate management fees on invested capital;


(v)	structured portfolio company investments that do not generate monitoring fees; and


(vi)	the difference between gross asset and net asset value for those funds that earn management fees based on net asset value.

We use non-fee generating AUM combined with fee-generating AUM as a performance measurement of our investment activities, as well as to monitor fund size in relation to professional resource and infrastructure needs. Non-fee generating AUM includes assets on which we could earn carried interest income.


•	Private equity dollars invested is the aggregate amount of dollars invested by certain of Apollo’s private equity funds during a given period, which we believe is a useful supplemental measure because it provides shareholders with information about the capital deployed for investment opportunities in a given period.

•

Uncalled private equity commitments represents unfunded capital commitments that certain of Apollo’s private equity funds have received from its limited partners to contribute capital to fund future or current investments and expenses, which we believe is a useful supplemental measure because it provides shareholders with information about the unfunded capital commitments available to be deployed for future or current investments and expenses for our private equity funds.

•

“Gross IRR” of a fund represents the cumulative investment-related cash flows for all of the investors in the fund on the basis of the actual timing of investment inflows and outflows (for unrealized investments assuming disposition on December 31, 2013 or other date specified) aggregated on a gross basis quarterly, and the return is annualized and compounded before management fees, carried interest and certain other fund expenses (including interest incurred by the fund itself) and measures the returns on the fund’s investments as a whole without regard to whether all of the returns would, if distributed, be payable to the fund’s investors.

•

“Net IRR” of a fund means the gross IRR applicable to all investors, including related parties which may not pay fees, net of management fees, organizational expenses, transaction costs, and certain other fund expenses (including interest incurred by the fund itself). The realized and the estimated unrealized value is adjusted such that a percentage of up to 20.0% of the unrealized gain is allocated to the general partner, thereby reducing the balance attributable to fund investors carried interest all offset to the extent of interest income, and measures returns based on amounts that, if distributed, would be paid to investors of the fund to the extent that an Apollo fund exceeds all requirements detailed within the applicable fund agreement.

Apollo Global Management, Inc. - FORM 8-K - EX-99.1 - February 7, 2014

Attached files

Apollo Global Management, Inc. Reports