Q3 2021 Apollo Global Management Inc Earnings Call

November 2, 2021

Good morning, and welcome to Apollo Global management's third quarter 2021 earnings Conference call.

During todays discussion all callers will be placed in listen only mode and following management's prepared remarks, the conference call will be opened for questions.

Conference call is being recorded.

I would now like to turn the call over to now look on global head of Investor Relations.

Thanks, operator, and thanks to all of you for tuning into our call. This morning.

Joining me today are Mark <unk>, CEO and cofounder, Scott climate co President and Martin Kelly, Our Chief Financial Officer, and co Chief Operating Officer earlier. This morning, we issued an earnings release and financial supplement which are available on our website. As a reminder, today's call may include forward looking statements and projections, which do not guarantee future.

Our performance, we do not undertake any duty to revise or update such statements to reflect new information subsequent events or changes in strategy.

Please refer to our most recent quarterly and annual reports and other SEC filings for a discussion of the factors that could cause actual results to differ materially from those expressed or implied.

We will be discussing certain non-GAAP measures on this call, which we believe are relevant in assessing the financial performance of the business and you'll find reconciliations of these metrics within our earnings materials available at Pollo Dot com backslash stockholders with that I'd now like to turn it over to mark to kick off our comments for today.

Thank you Noah and good morning, it's my pleasure to start out.

Outline another quarter of very strong results.

<unk> for the quarter was $1 71 per share our highest quarter on record FRE of $300 million or <unk> 68 cents a share.

Very strong performance FRE for the first nine months $2 <unk> per share up 16% year over year for the same period and as you will hear from Scott, we're seeing strong momentum across all fronts, whether it's investment deployment realization or fundraising.

Year to date organic Athene inflows plus third party fundraising, we're 44 billion and we expect them to exceed 55 billion for the year Importantly, this will be a record year of organic growth at athene and equally as important this will be a record year of fundraising in the non flagship ear for Apollo.

And this again is despite headwinds from the end of 2020.

We are well positioned to execute on our long term targets and deliver for our shareholders.

Let me now pivot from the quarter and focus on next year in the next five years.

Two weeks ago, many of you endured five hours.

US walking you through our strategic plan.

We enjoyed the opportunity to share our road map.

And to show you, how we are positioned to drive the business forward.

Rather than rehearse or repeat five hours worth of material for those who are interested let's hit the cliff notes, we're in a growth business driven by the need for retirement income in it.

<unk> market.

Our addressable market is the largest among our alternative peers focused in particular on fixed income replacement.

<unk> is a competitive differentiator and a growth accelerant.

Our model is highly capital efficient and I'll focus a little bit on this quarter's activities and show you just how efficient.

And we have a strong strong momentum behind the fully aligned industry, leading team and continue to add amazing talent.

A reminder, our business is not about just scale that is not about AUM. It is about delivering excess return per unit of risk to our clients that is the promise of alternatives and so long as we do that we will continue to grow and the reminder to everyone. In our firm is that AUM growth is the reward for good performance at <unk>.

Not the goal.

As many of you took away from the five hour dialogue our plan Embeds <unk>, one and expansion into retail following the democratization of finance the second growth in capital solutions.

And the third direct origination and scaling of direct origination from roughly $80 billion on an annual basis run rate. This year to 150 billion five years out.

While progress was made against all three objectives. This quarter was all about origination with numerous platform additions within our ecosystem. The team led by Chris Hudson is laser focused on continuing to scale, our origination, which ultimately is one of the drivers of growth in our fixed income replacement.

This in our yield business.

Just to highlight three additions to our ecosystem announced or closed this quarter. The first was Max cap Max cabins and Australian CRE.

Financier and fund manager.

The second is new Fi New Fi is a technology driven multichannel mortgage lender.

And the third is wheels, which will be merged with our existing Donlin fleet platform, creating combined fleet business with 5 billion of pro forma assets and 550000 customers.

Each of these three will drive significant amounts.

Of investment grade.

Private and spread enhancing origination.

Origination and the ability to find spread without taking on increased risk is the driver to success in our yield business.

<unk>, none of the capital to add to these three platforms or to acquire these III platforms was required from the Apollo holding company.

As many of you who tuned into our Investor day understand.

We run an incredibly capital efficient business and are able to scale. These origination platforms without capital from the holding company, leaving us free to deploy that capital towards growth initiatives or to return to shareholders.

In summary, our.

Our business is changing rapidly markets rates and technology are and democratization of finance are all sources of this change rather than fear. This change we embraced this change we're going to continue to lead into technology and innovation and capitalize on the disruptive trends.

The platform continues to attract incredibly high quality talent and I would highlight just two for this quarter first Bill Lewis joining us as senior partner and a member of Apollo's Management Committee and the second Dave <unk>, Our new Chief Sustainability Officer also a member of Apollo's Management Committee.

With that I'll now turn it over to Scott to review the quarter in more detail.

Thanks, Mark and thank you all for joining us this morning.

As you've heard us say before our strategic differentiator is our ability to source excess returns across the risk reward spectrum.

And scale of our platform gives us confidence in our ability to originate attractive investment opportunities for our clients and deploy capital in a variety of environments for.

For the third quarter total deployment of over $28 billion set.

Set another quarterly record year to date deployment volume is tracking nearly 81 billion compared with 88 billion for full year 2020, and 75 billion for full year 2019.

These figures indicate the tremendous amounts of investment activity, taking place across our platform.

In our private equity business drawdown funds invested $5 billion.

Including for Yahoo, Great Canadian and WR, Grace and committed to invest an additional $6 5 billion as of quarter end. Additionally.

Additionally, investing activity for athene accelerated significantly from second quarter levels as cash was put to work.

Moving on to debt origination total origination volume of $19 billion in the third quarter is run rating at the $80 billion level that we disclosed at Investor day.

Our origination machine continues to build momentum led by robust mid cap volume Redding Ridge CLO formation.

Strength out of Europe.

Sure.

We also have line of sight into a healthy high grade Alpha pipeline over the next couple of quarters.

While we spend most of our time sourcing incremental investment opportunities today's environment for Attunity as today's environment has been accommodative to harvest ripe investments within our portfolio.

You can see from our results that were in the midst of a robust realization cycle with overlap from fund eight and fund nine monetization activity, we're delivering tremendous value back to our Lps, while at the same time generating attractive performance fees for our shareholders.

During the third quarter, we returned $8 8 billion of capital to fund our to our fund investors, including $6 2 billion from our private equity funds.

Year to date private equity realizations have reached 16 billion, which compares to $5 billion for all of 2020.

Looking out over the next several quarters the realization pipeline remains strong for our flagship private equity funds.

As Mark highlighted earlier overall investment performance remained solid within the <unk> portfolio of four 8% and core credit up two 1% during the quarter.

In private equity we saw divergence in returns between our funds private and public positions, which is not uncommon given the volatility in public markets.

Private markets were up 12%, while public holdings, representing roughly 20% of our portfolio declined 12%. Additionally.

Additionally, our private equity portfolio has appreciated 58% over the last 12 months.

Overall, our flagship private equity fund performance remains quite strong with fund nine generated a gross IRR of 47%, 28% net.

Our inaugural hybrid value fund also continues to deliver exceptional performance with a gross IRR of 32% and 26% net.

In credit we saw particularly good gross returns indirect origination of three 2% and in structured credit of two 9% during the quarter.

Overall, we continue to be positioned cautiously across the portfolio, but with that said, we continue to see substantial demand for fixed income replacement assets.

Moving to capital raising we are encouraged by recent LP conversations and new strategic mandate wins as third quarter AUM increased 9 billion sequentially.

Total inflows were quite strong at $18 billion up from $12 billion in the second quarter and were broad based we continue to see impressive organic growth from athene driven by the diversity of their low cost funding origination capabilities as we recently highlighted at our Investor day.

Gross inflows from Athene totaled 12 billion in the third quarter and $28 billion year to date, and we still expect approximately 35 billion of gross inflows for the full year 2021.

Third party inflows exceeded $5 billion in the third quarter, bringing the year to date total to approximately $15 billion.

Third quarter activity was driven by nearly $2 5 billion from high grade Alpha mandates, bringing total high grade alpha SMA to over $4 billion.

As we communicated at Investor Day, we expect to raise approximately $23 billion of third party capital for full year, 'twenty, one which implies a pickup in the fourth quarter fundraising levels.

The near term fundraising pipeline includes fund raising for our core plus EPS four and revolver too.

Additionally, with fund, 975% committed as of quarter end, we expect to launch the formal fundraising process for form 10 in the first quarter of 2022.

In conclusion, we're encouraged by the progress we've already made to execute on our vision for Tomorrow's Apollo as.

As Mark emphasize we're continuing to build out our origination ecosystem to capitalize on a larger fixed income addressable market.

The upcoming merger with Athene is key to this strategy, especially as a provider of a growing stream of low cost funding so with that I'll hand, it over to Martin to go through this quarter's financial results in more detail.

Great. Thanks, Scott from a financial perspective, today's results provided a strong and supportive first step towards our multiyear goals that.

We laid out at our recent Investor day.

In the third quarter, we generated record after tax distributable earnings of $752 million or $1 71 per share.

<unk> was up sharply quarter over quarter, driven by private equity net realized performance fees of <unk> 74 per share.

And realized investment income of 66 per share.

Robust net realized performance fees of $312 million were up $90 million sequentially, primarily related to strong realization activity in funds.

With notable transactions, including Onemain financial double Eagle energy and Apollo education.

And the first realized carry distribution from fund nine driven by tech data and smart and final.

Particularly strong realized investment income during the quarter was driven by the monetization of our platform investment in Venerable, which was sold to certain funds, we manage and authority.

This mutually beneficial transaction allowed Apollo to redeploy capital into other strategic priorities, while presenting a compelling investment opportunity at an attractive entry valuation for a thorough and our fund investors.

A record result in the quarter was also attributable to our strong and consistent fee related earnings, which amounted to $300 million or <unk> 68 per share.

Despite strong realization activity management fees continued to demonstrate growth increasing 9% year over year.

We generated $65 million of transaction and advisory fees during the third quarter, primarily driven by our private equity business and reflecting transaction fees in connection with a number of portfolio investments, including co investment activity on the Yahoo transaction.

As we discussed at Investor day, with an increasing focus on building and leveraging our capital solutions capabilities.

You should expect the annual revenue contribution from transaction and advisory fees to increase meaningfully over the coming years.

Fees related fee related performance fees rose $12 million sequentially.

As a reminder, these fees represent an incentive based fees from platforms or permanent capital vehicles, including Redding Ridge, the public BDC, we manage and mid cap.

The third quarter level is a reasonable approximation for the quarterly revenue, we expect going forward.

So your related expenses were relatively flat sequentially. Despite continued hiring due to start the timing.

We expect fee related expenses, both comp and non comp costs to increase in the fourth quarter.

Related to this elevated hiring trend in line with our full year 2021 margin target of approximately 54%.

We expect the pace of head count and compensation growth to normalize as we move through 2022.

And the accelerated investment spend is fully incorporated into our run rate.

As we explained at Investor Day, we are focused on completing a significant compensation reset that will create better alignment with investment performance and drive our future FRE compensation ratio downward.

These changes will create strong alignment with shareholders and serves to increase our highest value earnings streams.

As a result of this reset we expect to experience an accelerated stock based compensation charge around the time the merger closes.

This number was reflected in the pro forma share count of approximately 600 million should total shares we presented at Investor day.

It does not change any of our forward earnings calls.

We expect this noncash item will impact our GAAP net income, but not our operating results.

Turning to AUM total AUM of $481 billion was up 2% quarter over quarter.

And 11% year over year, driven by 18 billion of inflows, which Scott detailed and solid investment performance, partially offset by higher realizations.

We declared a dividend of <unk> 50 per share in line with our previous guidance as we continued to glide path to a new fixed dividend policy.

We retained <unk> of approximately $500 million for continued growth opportunities.

Which funded our investments of approximately $350 million in the quarter in motive and challenger.

We expect the fourth quarter dividend paid in February to reflect our new dividend policy of 40 per quarter or $1 60 per year.

Our net balance sheet value in the third quarter increased to $5 $1 billion up from $4 $8 billion in the second quarter.

Cash on hand increased to $2 1 billion.

Additionally, we expect to exceed the $4 <unk> per share guidance for 2021 that we communicated on our prior earnings call in light of the $3 51 per share we've reported year to date.

I'd like to wrap up our prepared remarks by reiterating how much we all enjoyed the opportunity to outline our strategic vision and financial targets.

Investor Day.

We feel confident in achieving our base plan over the next five years, which includes growing fee related revenue by $2, two and a quarter times driven by growth in AUM and capital solutions.

Sorry by two five times due to positive operating leverage and sorry by one and three quarter times as the retirement services platforms continue to scale with the benefit of third party capital.

Overall, our goal is to more than double our day to more than $9 per share by 2026, even before driving accretion from investing $5 billion of growth capital.

Or executing share repurchases.

We hope our strong Q3 results provide you early confidence in our ability to execute on this plan with.

With trailing 12 months, FRE and de <unk> up, 16% and 81% year over year, respectively.

While certain quarterly or annual periods may showed lower or higher growth, particularly as we wrap up our accelerated investments across the platform. We remain confident in our ability to deliver on our goal of 18% compound growth in FRE and 60% plus margins over the next five years.

With that I'll turn the call back to the operator for Q&A.

If you'd like to ask a question at this time. Please press. The Star then the number one key on your Touchtone telephone.

To withdraw your question press the pound key.

Again that is star then one if you'd like to ask a question at this time.

Please standby, while we compile the Q&A roster.

Our first question comes from Michael Cyprus with Morgan Stanley.

Hey, good morning, Thanks for taking the question I just wanted to come back to some of the strategic mandate wins that you alluded to earlier I think this was in credit I was just hoping you could maybe give us an update on how much capital you manage in some of these strategic mandates today and maybe if you can elaborate on where youre seeing some of the strength of the flows coming into these mandates.

And if you could just also talk about how you think about scaling these sort of customized mandates overtime.

Hey, Mike It's Martin So we spoke to mandates which were specific in the quarter to high grade Alpha, but this has been a focus of ours for a long time.

And we have over $30 billion in and mandates across the platform today and that number continues to increase as we bring.

You bet I saw them, which are which are customized for individual Lps and provide access to investments across the platform.

It's mark I'll expand on it for one second.

Martin is right is giving you all the numbers, but let me kind of describe what it is we're trying to do.

Our strategic mandate definition only is with a large account who is preparing to invest across the platform, but what is it they're trying to achieve really what they're trying to achieve is alignment.

And so we are pro forma for the merger with Athene and immense investor in our own products. There is nothing more comforting for another large strategic account than to have us investing side by side I think you will see us more and more emphasize the notion of alignment both in the fixed income area.

And increasingly in the equity area as no other firm will have the kind of alignment and therefore investment in products side by side with our clients that we will pro forma.

Our next question comes from Glenn <unk> with Evercore ISI.

Hi, Thanks very much.

So I just wanted to dig into the expansion into retail.

For you all.

Mind getting a little bit more about what you think in terms of product development you mentioned.

Joking acreage, but talk timing focus and key attributes that will differentiate your products. There and then just while we have it I'll just give my follow up.

As well.

Since Investor day, we've seen two deals and I would just describe them as traditional asset managers buying their way into the.

Alternatives World they have.

Retail distribution and now they're getting product.

I'm curious to get your thoughts on that reverse commute.

Opposed to you with product.

Building out distribution. Thank you.

Sure. So I'll take the first part of that so so as we described in Investor day, we are in the midst of dramatically building out our retail capabilities.

By year end, we will have about 30 professionals on our way to about 100 over the next couple of years.

That's going to really help us move a number of products both.

Purpose built for for retail type type products as well as <unk>.

Further driving.

Retail components of our traditional institutional products.

One of the first products coming to market is our.

Private BDC, which will be fully in the market by the beginning of the year.

That's going to be our expectation one of our flagship retail products given the strength of our credit capabilities, but over the course of the year, we're going to have a few other products coming out as well so.

We're incredibly optimistic on on what our retail capabilities will be in the product development behind it.

Thanks for tuning after suffer.

Suffering through five hours.

But I guess I'd give you the following perspective.

The thing Thats in short supply as assets, yes building out apply as assets, yes building out and reaching a retail channel is requires African requires.

Infrastructure.

But ultimately every asset that offers a good risk reward has a hub.

There is no shortage of capital to find those assets.

To reach a retail audience.

One needs the retail audience to accept some amount of the liquidity that is ultimately what moving into an alternative is.

Increasingly we've seen.

<unk> acceptance of high net worth and retail investors of this amount of illiquidity, whether it's a private BDC, a private REIT or a.

True alternative in terms of the equity area.

The big firms the traditional asset managers that are buying in in many ways are simply validating what's there which is the traditional markets cannot offer sustainable alpha and sustainable outperformance and so they are recognizing that they have to go and purchase that.

Ultimately this trend.

The ability of our retail firm to distribute these products will depend in part on there the capacity of their retail system. Many of these traditional retail systems are not set up to offer illiquid products.

And so everyone is essentially building toward this market in retail, but I come back to the place I started <unk>.

Generating assets that offer attractive risk rewards is ultimately the key to success. They will go to retail they will go to institutional they will go to capital solutions. They will go to a retirement services balance sheets.

And we want to serve all of those we currently serve three of those very well.

And we're building on the fourth.

Our next question comes from Patrick Davitt with Autonomous research.

Okay.

Hey, good morning.

On Australia, you mentioned Max cap.

In the prepared remarks, and I think theres, new that you've hired a bunch of other senior origination type people. There. This week. So could you update us on the opportunity there to maybe build something like Youre Athena feels like youre, starting to build a portfolio of origination capability, there, perhaps specifically for something similar.

Any thoughts around what the opportunity there is and can we start thinking about this as being something like Athene in Australia.

Yes look.

As we highlighted at Investor day.

Asia is probably the biggest untapped market for us on the retirement services side.

Massive market very fragmented different regulatory environments. So really plays to the strengths of Apollo.

We've started entering that market in a few different ways.

We've made investments in a couple.

A couple of large established retirement service platforms over there. We've also been entering into a number of flow reinsurance agreements.

In Asia as well.

As another way to play to our strength.

I think over time, you'll see more activity out of us in this both on the asset and liability side.

And.

Could ultimately create a consolidated platform for ourselves, but right now the strategy is really getting into the market through some well established players.

Our next question comes from Bill Katz with Citi.

Okay. Thank you. Thank you very much for taking the questions. This morning.

May have missed it I apologize can you just sort of go back and sort of talk to the the sizable investment income on the on the quarter. I think you mentioned that there was maybe some.

Intercompany sale going on just sort of wondering what that was and sort of how to think about the go forward impact of that thank you.

Yeah, Bill it's Martin.

The earnings related to our investment in in Venerable, which was the variable annuity platform that we set up some years back.

It was not an intercompany sale, we sell to fund investors into Florida.

And it was this was a great investment and it was it was something that was ultimately not intended to be part of the Apollo ecosystem and so we realized a great return.

And we're recycling that capital back.

Back into into other uses.

Bill, it's Mark I'll, probably just expand.

Venerable was a <unk>.

Private entity that Apollo and Athene.

And two other private equity firms bought created really some number of years ago in connection with the acquisition.

Voya is variable annuity business in our view variable is not a great product to be part of a public company given the inherent volatility of GAAP results. If the business is run properly having said that it's been an amazing investment all around.

In the last year.

Second block of business was added in connection with the equitable transaction and equitable became an investor in the platform.

Side by side with the existing private equity firms and with Apollo and with Athene.

The equitable Mark.

Apollo.

Hold its position in venerable to one of its funds and to a thorough.

There was obviously demand from other entities, including the other private equity firms for that same stake.

But this again this was a great investment and it's a great tool to have in our toolbox to offer.

The industry complete solutions in connection with Delevering their insurance and retirement services balance sheets, but it is not a permanent part of Apollo on a recurring basis.

Our next question comes from Robert Lee with <unk>.

Great. Thanks. Good morning, Thanks for taking my questions I have a question I guess relates more specifically.

Typically two theme.

<unk>.

Going forward, but I guess there's been.

Some accounting changes as it relates to insurance companies is no DTI I guess.

I mean is that going to have would that have any impact at all on how you think about our team's ability to.

Maybe not originate product, but from an accounting or capital perspective or.

How you would think about.

Reporting their results.

In short no.

I mean, one of the interesting things about Athene Athene was started as you know in 2008 and 2009, and therefore acquired a set of liabilities at a point in time when interest rates were very low and when there was pretty good understanding of where accounting was going and so we and Apollo have been.

On top of and Athene has been on top of the setting up of the reserves at each point in time.

And Athene has its call tomorrow and.

I think it would be a good question for you to ask them.

About the LTI and specifically.

The percentage of their business that is it comes with riders and other forms of variability versus the industry and I believe receive a very satisfactory answer.

Our next question comes from Alexandra <unk> with Goldman Sachs.

Thanks for the question good morning, guys.

Scott as you embark on <unk> it sounds like first quarter, you guys going to begin to fund raising can you maybe talk us through your latest thinking about sizing and what you're starting to hear for Mlps. How much of the fund do you expect ultimately be re ups from existing will be used versus some versus some new folks just general thoughts around how you expect this one to unfold.

Yes sure.

So as you can imagine.

I've been out.

Others have talking to Lps over the last couple of months and feedback is incredibly strong so I'm feeling very confident going into the fund raise early next year.

The.

The backdrop.

Demand is incredibly strong in the alternative space, particularly in private equity and we have thankfully been posting really good performance. So all of those things really point towards a very robust fundraise.

Yes.

Sort of giving us specific numbers, but would expect the fund rates to be at least as large as the current fund.

$25 billion, so like I said.

So really good about that.

Look as far as as far as the mix.

Each of our last several funds have been about 80% re up 20% new investors.

On our relationship building that probably feels like a good number but.

Ultimately, we'll see over the next couple of quarters.

Our next question comes from Robert <unk> with Bank of Montreal.

Great. Good morning, Thanks for taking my question I had a longer term one on a thorough.

I'd love to hear your thoughts around how you view the organic growth potential of a thorough overtime because when you look back at Athene.

Organic growth really started to pick up around five years ago and I was wondering if there are any structural differences between the bay Thor is set up in Europe that might make it harder to scale the business organically over time.

Yes.

Right sure. So Thor was has been setup like.

Like Athene initially was as buying blocks of runoff insurance.

<unk> got into the organic growth business over time through through acquisitions and through development of their various retail and organic channels.

A thorough if you look at for its first several years has largely been that same run off runoff business.

However through.

An acquisition it just announced in Italy, It actually is picking up a a meaningful new organic.

Business platform and would expect as it grows its Italian presence and is looking at.

Certain other countries.

Yeah.

You could certainly consider to look at organic growth as well as the as well as the inorganic activity in.

In addition.

The.

European PRT market is in its early stages, but it is clearly poised to be as big or bigger than the U S market and so our stores getting organized around that as well so to answer your initial question nothing is.

Structurally different or would structurally prevent that obviously they are slightly different markets with different products.

But where it makes sense.

Would expect that that will be the case.

Our next question comes from Jerry O'hara with Jefferies.

Okay. Thanks for taking the question.

I think in the prepared remarks.

You all mentioned a kind of a pickup in <unk> fundraising I was kind of hoping you might be able to flesh that out a little bit and also I guess as we think about.

Moving into next year beyond fund 10, what kind of what Youre.

We're looking forward to to drive fundraising efforts. Thank you.

Sure.

As as I alluded to in the comments, we have a number of funds expecting.

Closes in the fourth quarter, so things like EPS is going to have its first sizable first close.

Cord plus hybrid value, we'll have another close so just a number of a number of variety of different funds across the PE hybrid and youll platforms.

Next year as you can imagine.

A big part of the focus in the first part of the year will be our fund 10 flagship, but EPS impact plus.

Several of our credit products will be having.

Fundraising is going on as well throughout the year.

Our next question comes from Devin Ryan with JMP Securities.

Hi, This is Brian Mckenna for Devin So at the Investor Day, you spoke at length about the opportunity within Fintech and how Apollo can leverage this to drive a number of benefits and efficiencies across across the platform. This might be difficult to answer but is there any way to quantify the impact of this longer term specifically as it relates to revenues and expenses.

In short no I think it is difficult.

I think as I as I mentioned, it's marked by the way as we mentioned on Investor Day. This is a multi pronged opportunity and the easiest to understand is cost.

Obviously, moving securitizations from their current form to block chain is an information advantage on a cost advantage.

AUM, providing our capacity to accept large amounts of committed yield and the origination area too.

<unk> challengers.

Should be a source of AUM growth and is it takes up a considerable amount of our time.

Investing in and benefiting from the Fintech ecosystem with us as a large customer.

And at a large financial institution.

Also part of the playbook.

But I think you should think about this very holistically technology is going to impact every part of our business ultimately you'll see it probably first in capital solutions.

Which is the business that crank bar run.

Today that business runs salesperson to sales person.

It will not surprise you that we believe it will ultimately run linked to link.

And it will be just a much more efficient way and someone will an investor will be able to enter an Apollo ecosystem.

And decide how to invest and where to invest in addition to the traditional methods that does not mean that funds in fund raising are going to.

To disappear quite the contrary I think this is for a certain set of products and a certain set of institutions, but I do think.

Ovation and change are coming to our our corner of the industry.

And I for one welcome it.

That concludes.

<unk> the Q&A portion of today's call I will now return the floor to Noah Gunn for any additional or closing remarks.

Great. Thank you again, everyone for joining us this morning and for your continued interest in Apollo. If you have any questions regarding anything we discussed on today's call. Please feel free to reach out to us and we look forward to speaking with you all next quarter.

This concludes today's conference call. Thank you for participating you may now disconnect.

[music].

Good morning, and welcome to Apollo Global management's third quarter 2021 earnings Conference call.

During todays discussion all callers will be placed in listen only mode and following management's prepared remarks, the conference call will be opened for questions.

This conference call is being recorded.

I would now like to turn the call over to Noah Gunn Global head of Investor Relations.

Thanks, operator, and thanks to all of you for attorney tuning into our call. This morning.

Joining me today are Marc Rowan CEO and cofounder, Scott climate co President and Martin Kelly, Our Chief Financial Officer, and co Chief Operating Officer earlier. This morning, we issued an earnings release and financial supplement which are available on our website. As a reminder, today's call may include forward looking statements and projections, which do not guarantee future.

Events, our performance, we do not undertake any duty to revise or update such statements to reflect new information subsequent events or changes in strategy. Please refer to our most recent quarterly and annual reports and other SEC filings for a discussion of the factors that could cause actual results to differ materially from those expressed or implied.

We will be discussing certain non-GAAP measures on this call, which we believe are relevant in assessing the financial performance of the business and you'll find reconciliations of these metrics within our earnings materials available at Apollo Dotcom backslash stockholders with that I'd now like to turn it over to mark to kick off our comments for today.

Thank you Noah and good morning, it's my pleasure to start out and outline another quarter of very strong results for the quarter was $1 71 per share our highest quarter on record FRE of $300 million or <unk> 68 cents a share.

Year to date.

Ganic Athene inflows plus third party fundraising, we're 44 billion and we expect them to exceed 55 billion for the year Importantly, this will be a record year of organic growth at athene and equally as important this will be a record year of fundraising and a non flagship ear for Apollo and this again is despite headwinds.

From the end of 2020.