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Apollo Global 1Q net income rises on higher fees

The Associated Press

NEW YORK (AP) -- Apollo Global Management LLC's first-quarter net income more than doubled to $98 million as it collected higher transaction and management fees.

Apollo also benefited from a rise in the value of its private equity funds in the period.

The private equity company's total assets under management grew to $86 billion from $70 billion with help from the addition of Gulf Stream Asset Management, which Apollo acquired at the end of 2011. Apollo's assets under management grew again, to $105 billion, after the quarter ended, with the April 2 acquisition of Stone Tower Capital.

The firm's net income for the first three months of the year amounted to 66 cents per share, compared with $38.2 million, or 33 cents per share, in the same period a year earlier.

Apollo said its economic net income, a gauge of performance that's used more widely in the private equity industry than net income or earnings per share, was $1.10 per share in the first quarter, up from 99 cents per share a year ago. Economic net income strips out charges related to the company's reorganization in 2007 and other items.

Analysts polled by FactSet had predicted adjusted earnings of 67 cents.

Revenue rose about 12 percent to $776.7 million from $696.3 million. Analysts predicted $640 million.

The firm's private equity business got a boost from higher fees from transactions such as IPOs. Rexnord Corp., which went public in March, paid Apollo $6.1 million in fees associated with the deal, the firm said Tuesday. Apollo bought Rexnord in 2006. Apollo's private equity fund performance also improved in the quarter, rising 16 percent.

Private equity firms such as Apollo buy companies and try to sell them later for more money.

At the end of the first quarter, Apollo had about $7.4 billion available for further investments. It announced a dividend of 25 cents, to be paid May 30 to holders of record as of May 21.

Apollo's stock rose 65 cents, or 5.3 percent, to close Tuesday at $12.85.