Apollo Global AUM slips 4.7% in quarter

Updated with correction

Unrealized market losses from the COVID-19 pandemic in the first quarter drove down Apollo Global Management's assets under management to $315.5 billion, a 4.7% drop from $331.1 billion at the end of the prior quarter but a 4.1% rise from $303 billion year-over-year.

The significant unrealized mark-to-market losses of Apollo's underlying funds were in line with volatility in the public credit and equity markets, Apollo co-founder and CIO Joshua Harris said Friday on an earnings call.

He said that Apollo is "a prisoner of the markets" on a short-term basis.

The declines were partially offset by fundraising, Apollo's earnings release said.

The AUM of Apollo's largest business, credit, was $209.7 billion as of March 31, down 2.7% from $215.5 billion at the end of the fourth quarter, but up 8.3% from $193.7 billion at the end of the year-earlier quarter.

In the first quarter, Apollo invested $3.4 billion mostly in corporate credit as well as structured credit, direct lending, longevity assets and reinsurance transactions.

Private equity AUM was $67.7 billion, down 11.8% from $76.8 billion at the end of the fourth quarter and 12.4% from $77.3 billion as of March 31, 2019.

Real assets AUM was $38.1 billion as of March 31, flat from $38.3 billion at the end of the prior quarter but up 19% from $32 billion year-over-year.

As of March 31, Apollo had $40.5 billion of dry powder.

Apollo had net clawbacks of $577.3 million at the end of the first quarter, representing its obligation to return performance fees it already collected.

Martin Kelly, Apollo's CFO, said on the call that the net clawbacks reflect a "point in time mark to market" and that Apollo's obligation to return performance fees already paid would reverse with an unrealized appreciation of about 11%.

Apollo had a GAAP net loss of $2.3 billion.