Financial Data and Key Metrics Changes - Ares Management Corporation declared a quarterly dividend of 1.12pershare,representinga20484 billion, up over 15% year-over-year, with fee-paying AUM increasing nearly 12% to approximately 293billion[57]BusinessLineDataandKeyMetricsChanges−InvestmentactivityinQ4reachedover32 billion, a 34% increase from the prior year, driven by increases in US private credit, real estate debt and equity, and secondary solutions [17] - The company raised a record 28.3billioninnewcapitalcommitmentsinQ4,contributingtoafull−yearfundraisingrecordof92.7 billion, exceeding the previous record by over 15billion[22]−Thewealthmanagementchannelsawinflowstriplingyear−over−year,withtotalAUMexceeding39 billion across eight semi-liquid products [33][38] Market Data and Key Metrics Changes - The company noted over 3trillionofunrealizedvalueacross28,000unsoldcompaniesinglobalbuyoutportfolios,indicatingsignificantpent−updemandfortransactions[19]−Thecompetitivelandscapeisintensifying,butAresbelievesitmaintainsastrongcompetitivepositionsupportedbyitsproductsandperformancetrackrecord[36]CompanyStrategyandDevelopmentDirection−Aresaimstodeepenitsabilitytosourcedifferentiatedhigh−qualityassetsandexpanditsinvestmentstrategies,includingtherecentacquisitionofGCPInternational[15][20]−Thecompanyplanstoleverageitsleadershipincorporatecredittoexpandmarketshareinrealestateandinfrastructurelending[81]−Aresisfocusedonenhancingitscapabilitiesindigitalinfrastructureandneweconomyrealestatethroughstrategicinitiatives[81]Management′sCommentsonOperatingEnvironmentandFutureOutlook−Managementexpressedoptimismfor2025,anticipatingagradualimprovementinthetransactionenvironmentandincreasednetinvestmentactivity[18]−Thecompanyexpectstoenter2025witharecord133 billion of dry powder, positioning it well for future opportunities [21] - Management highlighted the importance of generating differentiated fund performance and maintaining strong relationships with investors [64] Other Important Information - Ares reported a record level of realized income for the full year, exceeding $1.4 billion, a 16% increase from 2023 [56] - The company is committed to supporting employees affected by recent wildfires in Los Angeles, providing resources and support through the Ares Charitable Foundation [44] Q&A Session Summary Question: Long-term expense outlook and G&A growth - Management indicated that supplemental distribution fees are a major driver of G&A changes, with expectations for continued increases as new distribution channels open [71][75] Question: Strategic initiatives post-management changes - Management emphasized a focus on integrating GCP and capitalizing on opportunities in digital infrastructure and private credit [80] Question: Update on M&A appetite and business mix - Management stated that the bar for acquisitions is higher, focusing on organic growth opportunities while remaining open to strategic acquisitions [88][90] Question: Credit fee-paying AUM growth and deployment pipeline - Management noted strong deployment activity in Q4 and anticipated gradual improvement in the deployment environment, driven by pent-up demand [95][96] Question: Fundraising momentum and flagship contributions - Management highlighted a diverse range of funds in the market for 2025, with expectations for strong contributions from non-flagship fundraising channels [102][105] Question: Aspida partnership and potential for 401(k) market - Management expressed excitement about the partnership with T. Rowe Price, indicating potential for co-developing investment offerings and exploring opportunities in the 401(k) space [108][110]
Ares(ARES)2025-02-05 20:57