10-KPeriod: FY2024

Ares Management Corp Annual Report, Year Ended Dec 31, 2024

Filed February 27, 2025For Securities:ARESARES-PB

Summary

Ares Management Corporation (ARES) reported robust growth in its 2024 annual report, with total Assets Under Management (AUM) reaching $484.4 billion, a significant increase from the prior year. The company experienced strong fundraising, securing $92.7 billion in new capital commitments, with a substantial 85% coming from existing investors, indicating high client satisfaction and confidence in Ares' management capabilities and diverse product offerings. The firm demonstrated solid deployment of capital, investing $106.7 billion across its platform, which bodes well for future fee generation. The Credit segment remains the largest contributor to AUM and Fee Paying AUM (FPAUM), showing continued strength. While Fee Related Earnings (FRE) saw a healthy increase, reflecting the recurring revenue from management fees, net realized performance income was lower year-over-year, primarily due to a decrease in carried interest allocation, particularly in the Private Equity segment, influenced by market depreciation in certain investments. Looking ahead, Ares is focused on expanding its product offerings and distribution channels, including a growing presence in the wealth management sector. The company's diversified investment strategies and commitment to attracting and retaining talent are key drivers of its performance. Despite market volatility, Ares' strong track record and disciplined investment approach position it well for continued growth and value creation for its stakeholders.

Financial Highlights

27 data points
Beta

Revenue

$3.88B

Net Income

$440.96M

11.4% Net Margin

Total Assets

$24.88B

Cash & Equivalents

$1.51B

Free Cash Flow

$2.79B

Financial Statements
Beta
Revenue$3.88B
SG&A Expenses$736.50M
Operating Expenses$2.94B
Net Income$440.96M

Key Highlights

  • 1Ares Management Corporation's total Assets Under Management (AUM) grew to $484.4 billion as of December 31, 2024.
  • 2The company raised $92.7 billion in gross new capital commitments in 2024, with 85% from existing institutional investors.
  • 3Capital deployment reached $106.7 billion in 2024, significantly up from $68.1 billion in 2023, indicating strong investment activity.
  • 4Fee Related Earnings (FRE) increased by 17% year-over-year, reaching $1.36 billion, driven by growth in management fees across various segments.
  • 5Carried interest allocation decreased by 37% to $390.2 million due to market depreciation in certain Private Equity investments, impacting overall performance income.
  • 6The Credit Group remains the largest segment, with AUM of $348.8 billion, and showed strong Fee Related Earnings growth.
  • 7Ares Management Corporation declared quarterly dividends on its Class A and non-voting common stock, increasing from $0.77 per share in 2023 to $0.93 per share in 2024, reflecting confidence in its earnings.

Frequently Asked Questions

Ares Management Corporation demonstrated strong growth in 2024, with total Assets Under Management (AUM) reaching $484.4 billion. The company raised substantial new capital and deployed it effectively across its investment strategies. While Fee Related Earnings (FRE) showed a significant increase, driven by higher management fees, total revenues grew by 7% year-over-year, though net income attributable to common stockholders decreased slightly by 7% compared to the prior year, impacted by lower carried interest and a higher number of shares outstanding.

The Credit Group was the largest segment, with AUM of $348.8 billion, and showed robust Fee Related Earnings growth of 19%. The Real Assets Group's FRE slightly decreased by 3%, while the Private Equity Group's FRE increased by 14% and the Secondaries Group's FRE grew by 21%. The decrease in overall performance income was primarily driven by a significant drop in carried interest allocation from the Private Equity segment due to market depreciation in certain investments, partially offset by strong incentive fees from the Credit Group.

Ares Management Corporation's growth strategy focuses on expanding its AUM through continued fundraising, attracting new institutional and wealth management investors, and broadening its multi-asset class product offering. The company aims to enhance its distribution channels and leverage its integrated investment platform and collaborative culture. The outlook remains positive, supported by strong capital deployment, an increasing amount of AUM not yet paying fees ($81.0 billion, with potential for significant incremental annual management fees), and favorable market conditions for alternative investments, although market volatility and competition remain key considerations.

Ares Management Corporation intends to pay a fixed quarterly dividend for its Class A and non-voting common stock, based on its expected Fee Related Earnings (FRE) after an allocation of current taxes paid. For 2025, the company plans to pay a quarterly dividend of $1.12 per share. Dividends on the Series B mandatory convertible preferred stock are declared quarterly, and the company has indicated that taxes associated with income allocated to Series B preferred dividends will be borne by Class A and non-voting common stockholders. The declaration and payment of dividends are at the discretion of the Board of Directors.