Ares Management Corporation (ARES) Presents At Barclays 23rd Annual Global Financial Services Conference (Transcript)

Ares Management CEO Michael Arougheti, speaking at the Barclays Global Financial Services Conference, asserted that despite recent anxieties regarding the labor market, Ares's extensive portfolio data indicates the economy is on stable and resilient footing. He cited strong underlying metrics from their investments, including high real estate occupancy, Net Operating Income growth in credit portfolios, non-accruals well below historical averages, and 12-13% year-over-year EBITDA growth among portfolio companies, suggesting a more robust economic backdrop than widely perceived.

Analysis

Ares Management's CEO, Michael Arougheti, presented a bullish outlook on the economy, directly challenging recent market anxiety over a potentially softening labor market. Leveraging proprietary data from Ares's extensive portfolio—which includes over 3,000 middle-market companies and more than 500 million square feet of industrial real estate—management asserts that the economy rests on a stable and resilient footing. This view is substantiated by strong underlying performance metrics within their holdings. Specifically, portfolio companies are demonstrating 12% to 13% year-over-year EBITDA growth and increasing interest coverage. Furthermore, credit quality remains robust, with non-accrual rates well below historical averages, and the firm's real estate assets are experiencing high occupancy and positive Net Operating Income (NOI) growth. These granular, real-time indicators suggest that core segments of the economy, particularly the middle market and industrial logistics, are performing better than broader sentiment might imply, supporting a constructive outlook for activity through the remainder of 2025 and into 2026.

Key Decisions for Investors

• Investors should consider the CEO's optimistic guidance, supported by strong portfolio metrics like 12-13% EBITDA growth, as a positive signal for Ares Management's (ARES) forward earnings potential and deployment opportunities.
• Use Ares's commentary on high occupancy and robust credit quality as a potential leading indicator for the health of the U.S. middle-market and industrial real estate sectors, which may be more resilient than currently perceived by the wider market.
• Monitor future earnings reports from Ares for sustained low non-accrual rates and continued EBITDA growth in its portfolio companies to validate the current resilient economic thesis presented by management.