Ares Management Corp [ARES] Filings

10-Q 1 ares-20240930.htm 10-Q ares-20240930

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2024


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File No. 001-36429

ARES MANAGEMENT CORPORATION

(Exact name of Registrant as specified in its charter)


Delaware			80-0962035
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification Number)

1800 Avenue of the Stars, Suite 1400, Los Angeles, CA 90067

(Address of principal executive office) (Zip Code)

(310) 201-4100

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A common stock, par value $0.01 per share	ARES	New York Stock Exchange
6.75% Series B Mandatory Convertible Preferred Stock, par value $0.01 per share	ARES.PRB	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days: Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company.” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer

Accelerated Filer

☐

Non-Accelerated Filer

☐

Smaller Reporting Company

☐

Emerging Growth Company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No x

As of November 1, 2024 there were 198,390,128 of the registrant’s shares of Class A common stock outstanding, 3,489,911 of the registrant’s shares of non-voting common stock outstanding, 1,000 shares of the registrant’s Class B common stock outstanding, and 111,175,156 of the registrant’s Class C common stock outstanding.

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						Page
PART I—FINANCIAL INFORMATION
Item 1. Financial Statements						9
Condensed Consolidated Statements of Financial Condition as of September 30, 2024 and December 31, 2023						9
Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2024 and 2023						10
Condensed Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2024 and 2023						11
Condensed Consolidated Statements of Changes in Equity for the three and nine months ended September 30, 2024 and for the year ended December 31, 2023						12
Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2024 and 2023						14
Notes to the Condensed Consolidated Financial Statements						15
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations						53
Item 3. Quantitative and Qualitative Disclosures about Market Risk						110
Item 4. Controls and Procedures						111
PART II—OTHER INFORMATION
Item 1. Legal Proceedings						112
Item 1A. Risk Factors						112
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds						112
Item 3. Defaults Upon Senior Securities						112
Item 4. Mine Safety Disclosure						112
Item 5. Other Information						113
Item 6. Exhibits						114
Signatures						115

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Cautionary Note Regarding Forward-Looking Statements

This report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which reflect our current views with respect to, among other things, future events, operations and financial performance. You can identify these forward-looking statements by the use of forward-looking words such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “seeks,” “predicts,” “intends,” “plans,” “estimates,” “anticipates,” “foresees” or negative versions of those words, other comparable words or other statements that do not relate to historical or factual matters. The forward-looking statements are based on our beliefs, assumptions and expectations of our future performance, taking into account all information currently available to us. Such forward-looking statements are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business prospects, growth strategy and liquidity. Some of these factors are described in this report and in our Annual Report on Form 10-K for the year ended December 31, 2023, under the headings “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Item 1A. Risk Factors.” These factors should not be construed as exhaustive and should be read in conjunction with the risk factors and other cautionary statements that are included in this report and in our other periodic filings. If one or more of these or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, our actual results may vary materially from those indicated in these forward-looking statements. New risks and uncertainties arise over time, and it is not possible for us to predict those events or how they may affect us. Therefore, you should not place undue reliance on these forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made. We do not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law.

References in this Quarterly Report on Form 10-Q to the “Ares Operating Group” refer to Ares Holdings L.P. (“Ares Holdings”). References in this Quarterly Report on Form 10-Q to an “Ares Operating Group Unit” or an “AOG Unit” refers to a partnership unit in the Ares Operating Group entity.

The use of any defined term in this report to mean more than one entities, persons, securities or other items collectively is solely for convenience of reference and in no way implies that such entities, persons, securities or other items are one indistinguishable group. For example, notwithstanding the use of the defined terms “Ares,” “we” and “our” in this report to refer to Ares Management Corporation and its subsidiaries, each subsidiary of Ares Management Corporation is a standalone legal entity that is separate and distinct from Ares Management Corporation and any of its other subsidiaries.

Under generally accepted accounting principles in the United States (“U.S.”) (“GAAP”), we are required to consolidate (i) entities other than limited partnerships and entities similar to limited partnerships in which we hold a majority voting interest or have majority ownership and control over the operational, financial and investing decisions of that entity, including Ares-affiliates and affiliated funds and co-investment vehicles, for which we are presumed to have controlling financial interests, and (ii) entities that we concluded are variable interest entities (“VIEs”), including limited partnerships and collateralized loan obligations, for which we are deemed to be the primary beneficiary. When an entity is consolidated, we reflect the assets, liabilities, revenues, expenses and cash flows of the entity in our unaudited condensed consolidated financial statements on a gross basis, subject to eliminations from consolidation, including the elimination of the management fees, carried interest, incentive fees and other fees that we earn from the entity. However, the presentation of performance related compensation and other expenses associated with generating such revenues is not affected by the consolidation process. In addition, as a result of the consolidation process, the net income attributable to third-party investors in consolidated entities is presented as net income attributable to non-controlling interests in Consolidated Funds within Condensed Consolidated Statements of Operations. We also consolidate joint ventures that we have established with third-party investors for strategic distribution and expansion purposes. The results of these entities are reflected on a gross basis in the unaudited condensed consolidated financial statements, subject to eliminations from consolidation, and net income attributable to third-party investors in the consolidated joint ventures is presented within net income attributable to redeemable interest and non-controlling interests in Ares Operating Group entities or an “AOG Entity,” which refers to, collectively, Ares Holdings and any future entity designated by our board of directors in its sole discretion as an Ares Operating Group entity.

In this Quarterly Report on Form 10-Q, in addition to presenting our results on a consolidated basis in accordance with GAAP, we present revenues, expenses and other results on a: (i) “segment basis,” which deconsolidates the consolidated funds and removes the proportional results attributable to third-party investors in the consolidated joint ventures, and therefore shows the results of our operating segments without giving effect to the consolidation of these entities; and (ii) “unconsolidated reporting basis,” which shows the results of our operating segments on a combined segment basis together with the Operations Management Group (the “OMG”). In addition to our operating segments, the OMG consists of shared resource groups to support our operating segments by providing infrastructure and administrative support in the areas of accounting/finance, operations, information technology, legal, compliance, human resources, strategy and relationship management and

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distribution. The OMG includes Ares Wealth Management Solutions, LLC (“AWMS”) that facilitates the product development, distribution, marketing and client management activities for investment offerings in the global wealth management channel. Additionally, the OMG provides services to certain of the Company’s managed funds and vehicles, which reimburse the OMG for expenses either equal to the costs of services provided or as a percentage of invested capital. The OMG’s revenues and expenses are not allocated to our operating segments but we consider the cost structure of the OMG when evaluating our financial performance. This information constitutes non-GAAP financial information within the meaning of Regulation G, as promulgated by the SEC. Our management uses this information to assess the performance of our operating segments and the OMG, and we believe that this information enhances the ability of shareholders to analyze our performance. For more information, see “Note 13. Segment Reporting,” within our unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q.

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Glossary

When used in this report, unless the context otherwise requires:

•“American-style waterfall” generally refers to carried interest that the general partner is entitled to receive after a fund investment is realized and the investors in the fund have received distributions in excess of the capital contributed for that investment and all prior realized investments (including allocable expenses) plus a preferred return;

•“Ares”, the “Company”, “AMC”, “we”, “us” and “our” refer to Ares Management Corporation and its subsidiaries;

•“Ares Operating Group entities” or an “AOG Entity” refers to, collectively, Ares Holdings, L.P. (“Ares Holdings”) and any future entity designated by our board of directors in its sole discretion as an Ares Operating Group entity;

•“Ares Operating Group Unit” or an “AOG Unit” refers to, collectively, a partnership unit in the Ares Operating Group entities including Ares Holdings and any future entity designated by our board of directors in its sole discretion as an Ares Operating Group entity;

•“assets under management” or “AUM” generally refers to the assets we manage. For our funds other than CLOs, our AUM represents the sum of the net asset value (“NAV”) of such funds, the drawn and undrawn debt (at the fund-level including amounts subject to restrictions) and uncalled committed capital (including commitments to funds that have yet to commence their investment periods). NAV refers to the fair value of the assets of a fund less the fair value of the liabilities of the fund. For the CLOs we manage, our AUM is equal to initial principal of collateral adjusted for paydowns. AUM also includes the proceeds raised in the initial public offerings of special purpose acquisition companies (“SPACs”) sponsored by us, less any redemptions;

•“AUM not yet paying fees” (also referred to as “shadow AUM”) refers to AUM that is not currently paying fees and is eligible to earn management fees upon deployment;

•“available capital” (also referred to as “dry powder”) is comprised of uncalled committed capital and undrawn amounts under credit facilities and may include AUM that may be canceled or not otherwise available to invest;

•“catch-up fees” refers to management fees charged retroactively on limited partner commitments to a fund following the initial close date of that fund. These fees are charged to ensure that all limited partners’ claims on the net assets of that fund are ratable with their commitment. Catch-up fees reflect the fees generated between the fund’s initial close date and the last day of the quarter prior to the new limited partner’s commitment;

•“CLOs” refers to “our funds” that are structured as collateralized loan obligations;

•“Consolidated Funds” refers collectively to certain Ares funds, co-investment vehicles, CLOs and SPACs that are required under GAAP to be consolidated in our consolidated financial statements;

•“Credit Facility” refers to the revolving credit facility of the Ares Operating Group;

•“effective management fee rate” represents annualized management fees divided by the average fee paying AUM for the period, excluding the impact of catch-up fees;

•“European-style waterfall” generally refers to carried interest that the general partner is entitled to receive after the investors in a fund have received distributions in an amount equal to all prior capital contributions plus a preferred return;

•“fee paying AUM” or “FPAUM” refers to the AUM from which we directly earn management fees. FPAUM is equal to the sum of all the individual fee bases of our funds that directly contribute to our management fees. For

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our funds other than CLOs, our FPAUM represents the amount of limited partner capital commitments for certain closed-end funds within the reinvestment period, the amount of limited partner invested capital for the aforementioned closed-end funds beyond the reinvestment period and the portfolio value, gross asset value or NAV. For the CLOs we manage, our FPAUM is equal to the gross amount of aggregate collateral balance, at par, adjusted for defaulted or discounted collateral;

•“fee related earnings” or “FRE”, a non-GAAP measure, is used to assess core operating performance by determining whether recurring revenue, primarily consisting of management fees and fee related performance revenues, is sufficient to cover operating expenses and to generate profits. FRE differs from income before taxes computed in accordance with GAAP as FRE excludes net performance income, investment income from our funds and adjusts for certain other items that we believe are not indicative of our core operating performance. Fee related performance revenues, together with fee related performance compensation, is presented within FRE because it represents incentive fees from perpetual capital vehicles that are measured and eligible to be received on a recurring basis and are not dependent on realization events from the underlying investments;

•“fee related performance revenues” refers to incentive fees from perpetual capital vehicles that are: (i) measured and eligible to be received on a recurring basis; and (ii) not dependent on realization events from the underlying investments. Certain vehicles are subject to hold back provisions that limit the amounts paid in a particular year. Such hold back amounts may be paid in subsequent years, subject to their extended performance conditions;

•“GAAP” refers to accounting principles generally accepted in the United States of America;

•“Holdco Members” refers to Michael Arougheti, David Kaplan, Antony Ressler, Bennett Rosenthal, Ryan Berry and R. Kipp deVeer;

•“incentive eligible AUM” or “IEAUM” generally refers to the AUM of our funds and other entities from which carried interest and incentive fees may be generated, regardless of whether or not they are currently generating carried interest and incentive fees. It generally represents the NAV plus uncalled equity or total assets plus uncalled debt, as applicable, of our funds for which we are entitled to receive carried interest and incentive fees, excluding capital committed by us and our professionals (from which we generally do not earn carried interest and incentive fees), as well as proceeds raised in the initial public offerings of SPACs sponsored by us, less any redemptions. With respect to Ares Capital Corporation (NASDAQ: ARCC) (“ARCC”), Ares Strategic Income Fund (“ASIF”) and Ares European Strategic Income Fund’s (“AESIF”) AUM, only Part II Fees may be generated from IEAUM;

•“incentive generating AUM” or “IGAUM” refers to the AUM of our funds and other entities that are currently generating carried interest and incentive fees on a realized or unrealized basis. It generally represents the NAV or total assets of our funds, as applicable, for which we are entitled to receive carried interest and incentive fees, excluding capital committed by us and our professionals (from which we generally do not earn carried interest and incentive fees). ARCC, ASIF and AESIF are only included in IGAUM when Part II Fees are being generated;

•“management fees” refers to fees we earn for advisory services provided to our funds, which are generally based on a defined percentage of fair value of assets, total commitments, invested capital, net asset value, net investment income, total assets or par value of the investment portfolios managed by us. Management fees include Part I Fees, a quarterly fee based on the net investment income of certain funds;

•“net inflows of capital” refers to net new commitments during the period, including equity and debt commitments and gross inflows into our open-ended managed accounts and sub-advised accounts, as well as new debt and equity issuances by our publicly-traded vehicles minus redemptions from our open-ended funds, managed accounts and sub-advised accounts;

•“net performance income” refers to performance income net of related compensation that is typically payable to our professionals;

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•“our funds” refers to the funds, alternative asset companies, trusts, co-investment vehicles and other entities and accounts that are managed or co-managed by the Ares Operating Group, and which are structured to pay fees. It also includes funds managed by Ivy Hill Asset Management, L.P., a wholly owned portfolio company of ARCC and an SEC-registered investment adviser;

•“Part I Fees” refers to a quarterly fee on the net investment income of ARCC, CION Ares Diversified Credit Fund (“CADC”), ASIF and AESIF. Such fees are classified as management fees as they are predictable and recurring in nature, not subject to contingent repayment and generally cash-settled each quarter, unless subject to a payment deferral;

•“Part II Fees” refers to fees from ARCC, ASIF and AESIF that are paid in arrears as of the end of each calendar year when the respective cumulative aggregate realized capital gains exceed the cumulative aggregate realized capital losses and aggregate unrealized capital depreciation, less the aggregate amount of respective Part II Fees paid in all prior years since inception;

•“performance income” refers to income we earn based on the performance of a fund that is generally based on certain specific hurdle rates as defined in the fund’s investment management or partnership agreements and may be either incentive fees earned from funds with stated investment periods or carried interest;

•“perpetual capital” refers to the AUM of: (i) our publicly-traded vehicles, including ARCC, Ares Commercial Real Estate Corporation (NYSE: ACRE) (“ACRE”) and Ares Dynamic Credit Allocation Fund, Inc. (NYSE: ARDC) (“ARDC”); (ii) our non-traded vehicles, including ASIF, CADC and AESIF, our non-traded real estate investment trusts (“REITs”) and Ares Private Markets Fund (“APMF”); (iii) Aspida Holdings Ltd. (together with its subsidiaries, “Aspida”); and (iv) certain other commingled funds and managed accounts that have an indefinite term, are not in liquidation, and for which there is no immediate requirement to return invested capital to investors upon the realization of investments. Perpetual Capital - Managed Accounts refers to managed accounts for single investors primarily in illiquid strategies that meet the perpetual capital criteria. Perpetual Capital - Private Commingled Funds refers to commingled funds that meet the perpetual capital criteria, not including our publicly-traded vehicles or non-traded vehicles. Perpetual capital may be withdrawn by investors under certain conditions, including through an election to redeem an investor’s fund investment or to terminate the investment management agreement, which in certain cases may be terminated on 30 days’ prior written notice. In addition, the investment management or advisory agreements of certain of our publicly-traded and non-traded vehicles have one year terms, which are subject to annual renewal by such vehicles;

•“realized income” or “RI”, a non-GAAP measure, is an operating metric used by management to evaluate performance of the business based on operating performance and the contribution of each of the business segments to that performance, while removing the fluctuations of unrealized income and losses, which may or may not be eventually realized at the levels presented and whose realizations depend more on future outcomes than current business operations. RI differs from income before taxes by excluding: (i) operating results of our Consolidated Funds; (ii) depreciation and amortization expense; (iii) the effects of changes arising from corporate actions; and (iv) unrealized gains and losses related to carried interest, incentive fees and investment performance; and adjusting for certain other items that we believe are not indicative of our operating performance. Changes arising from corporate actions include equity-based compensation expenses, the amortization of intangible assets, transaction costs associated with mergers, acquisitions and capital activities, underwriting costs and expenses incurred in connection with corporate reorganization. Placement fee adjustment represents the net portion of either expense deferral or amortization of upfront fees to placement agents that is presented to match the timing of expense recognition with the period over which management fees are expected to be earned from the associated fund for segment purposes but have been expensed in advance in accordance with GAAP. For periods in which the amortization of upfront fees for segment purposes is higher than the GAAP expense, the placement fee adjustment is presented as a reduction to RI;

•“SEC” refers to the Securities and Exchange Commission.

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Many of the terms used in this report, including AUM, FPAUM, FRE and RI, may not be comparable to similarly titled measures used by other companies. In addition, our definitions of AUM and FPAUM are not based on any definition of AUM or FPAUM that is set forth in the agreements governing the funds that we manage and may differ from definitions of AUM or FPAUM set forth in other agreements to which we are a party or definitions used by the SEC or other regulatory bodies. Further, FRE and RI are not measures of performance calculated in accordance with GAAP. We use FRE and RI as measures of operating performance, not as measures of liquidity. FRE and RI should not be considered in isolation or as substitutes for operating income, net income, operating cash flows, or other income or cash flow statement data prepared in accordance with GAAP. The use of FRE and RI without consideration of related GAAP measures is not adequate due to the adjustments described above. Our management compensates for these limitations by using FRE and RI as supplemental measures to our GAAP results. We present these measures to provide a more complete understanding of our performance as our management measures it.

Amounts and percentages throughout this report may reflect rounding adjustments and consequently totals may not appear to sum.

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PART I—FINANCIAL INFORMATION

Item 1. Financial Statements

Ares Management Corporation

Condensed Consolidated Statements of Financial Condition
(Amounts in Thousands, Except Share Data)




	As of
	September 30, 2024		December 31, 2023
	(unaudited)
Assets
Cash and cash equivalents	$	350,138	$	348,274
Investments (includes accrued carried interest of $3,486,892 and $3,413,007 as of September 30, 2024 and December 31, 2023, respectively)	4,692,520		4,624,932
Due from affiliates	870,779		896,746
Other assets	641,120		429,979
Right-of-use operating lease assets	426,483		249,326
Intangible assets, net	969,976		1,058,495
Goodwill	1,133,074		1,123,976
Assets of Consolidated Funds:
Cash and cash equivalents	1,315,914		1,149,511
Investments held in trust account	544,254		523,038
Investments, at fair value	13,310,098		14,078,549

Receivable for securities sold	176,475		146,851
Other assets	91,819		100,823
Total assets	$	24,522,650	$	24,730,500
Liabilities
Accounts payable, accrued expenses and other liabilities	$	328,883	$	233,884
Accrued compensation	401,035		287,259
Due to affiliates	416,041		240,254
Performance related compensation payable	2,518,898		2,514,610
Debt obligations	2,542,358		2,965,480
Operating lease liabilities	535,686		319,572
Liabilities of Consolidated Funds:
Accounts payable, accrued expenses and other liabilities	179,928		189,523
Due to affiliates	—		3,554
Payable for securities purchased	377,026		484,117
CLO loan obligations, at fair value	11,070,261		12,345,657
Fund borrowings	273,000		125,241
Total liabilities	18,643,116		19,709,151
Commitments and contingencies
Redeemable interest in Consolidated Funds	544,154		522,938
Redeemable interest in Ares Operating Group entities	25,111		24,098
Non-controlling interests in Consolidated Funds	1,948,946		1,258,445
Non-controlling interests in Ares Operating Group entities	1,285,248		1,322,469
Stockholders’ Equity

Class A common stock, $0.01 par value, 1,500,000,000 shares authorized (198,334,674 shares and 187,069,907 shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively)	1,983		1,871
Non-voting common stock, $0.01 par value, 500,000,000 shares authorized (3,489,911 shares issued and outstanding as of September 30, 2024 and December 31, 2023)	35		35
Class B common stock, $0.01 par value, 1,000 shares authorized (1,000 shares issued and outstanding as of September 30, 2024 and December 31, 2023)	—		—
Class C common stock, $0.01 par value, 499,999,000 shares authorized (111,175,156 shares and 117,024,758 shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively)	1,112		1,170
Additional paid-in-capital	2,856,893		2,391,036
Accumulated deficit	(792,398)		(495,083)
Accumulated other comprehensive income (loss), net of tax	8,450		(5,630)
Total stockholders’ equity	2,076,075		1,893,399
Total equity	5,310,269		4,474,313
Total liabilities, redeemable interest, non-controlling interests and equity	$	24,522,650	$	24,730,500

See accompanying notes to the unaudited condensed consolidated financial statements.

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Ares Management Corporation

Condensed Consolidated Statements of Operations

(Amounts in Thousands, Except Share Data)

(unaudited)


	Three months ended September 30,				Nine months ended September 30,
	2024		2023		2024		2023
Revenues
Management fees	$	753,597	$	637,517	$	2,162,970	$	1,853,304
Carried interest allocation	277,651		(28,126)		194,006		541,828
Incentive fees	48,638		16,454		105,039		33,327
Principal investment income	8,036		9,339		44,547		38,985
Administrative, transaction and other fees	41,817		36,071		119,222		110,459
Total revenues	1,129,739		671,255		2,625,784		2,577,903
Expenses
Compensation and benefits	435,876		367,502		1,268,685		1,095,833
Performance related compensation	219,697		(25,448)		140,180		401,990
General, administrative and other expenses	197,019		211,842		537,379		501,340

Expenses of Consolidated Funds	2,295		7,064		11,680		28,171
Total expenses	854,887		560,960		1,957,924		2,027,334
Other income (expense)
Net realized and unrealized gains (losses) on investments	(5,074)		(1,770)		13,781		5,226
Interest and dividend income	7,553		4,752		19,952		11,281
Interest expense	(29,733)		(25,975)		(105,057)		(76,800)
Other income (expense), net	(18,805)		5,742		(19,473)		(1,068)
Net realized and unrealized gains on investments of Consolidated Funds	64,831		79,591		192,778		188,717
Interest and other income of Consolidated Funds	234,681		255,600		732,316		712,992
Interest expense of Consolidated Funds	(201,199)		(201,363)		(626,678)		(540,954)
Total other income, net	52,254		116,577		207,619		299,394
Income before taxes	327,106		226,872		875,479		849,963
Income tax expense	46,453		29,898		114,760		113,418
Net income	280,653		196,974		760,719		736,545
Less: Net income attributable to non-controlling interests in Consolidated Funds	64,241		80,289		236,446		174,663
Net income attributable to Ares Operating Group entities	216,412		116,685		524,273		561,882
Less: Net income (loss) attributable to redeemable interest in Ares Operating Group entities	1,319		758		1,005		(332)
Less: Net income attributable to non-controlling interests in Ares Operating Group entities	96,633		54,104		236,843		261,838



Net income attributable to Ares Management Corporation Class A and non-voting common stockholders	$	118,460	$	61,823	$	286,425	$	300,376
Net income per share of Class A and non-voting common stock:
Basic	$	0.55	$	0.30	$	1.31	$	1.54
Diluted	$	0.55	$	0.30	$	1.31	$	1.54
Weighted-average shares of Class A and non-voting common stock:
Basic	200,724,068		186,218,638		196,526,832		182,757,955
Diluted	200,724,068		186,218,638		196,526,832		182,757,955

Substantially all revenue is earned from affiliated funds of the Company.

See accompanying notes to the unaudited condensed consolidated financial statements.

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Ares Management Corporation

Condensed Consolidated Statements of Comprehensive Income

(Amounts in Thousands)

(unaudited)


	Three months ended September 30,				Nine months ended September 30,
	2024		2023		2024		2023
Net income	$	280,653	$	196,974	$	760,719	$	736,545
Foreign currency translation adjustments, net of tax	37,167		(23,984)		23,608		(21,780)
Total comprehensive income	317,820		172,990		784,327		714,765
Less: Comprehensive income attributable to non-controlling interests in Consolidated Funds	70,798		68,976		237,476		157,055

Less: Comprehensive income (loss) attributable to redeemable interest in Ares Operating Group entities	1,933		659		1,315		(738)
Less: Comprehensive income attributable to non-controlling interests in Ares Operating Group entities	107,698		49,110		245,031		260,351
Comprehensive income attributable to Ares Management Corporation	$	137,391	$	54,245	$	300,505	$	298,097

See accompanying notes to the unaudited condensed consolidated financial statements.

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Ares Management Corporation

Condensed Consolidated Statements of Changes in Equity

(Amounts in Thousands)

(unaudited)


	Class A Common Stock		Non-voting Common Stock		Class C Common Stock		Additional Paid-in-Capital		Accumulated Deficit		Accumulated Other Comprehensive Loss		Non-Controlling Interest in Ares Operating Group Entities		Non-Controlling Interest in Consolidated Funds		Total Equity
Balance as of December 31, 2023	$	1,871	$	35	$	1,170	$	2,391,036	$	(495,083)	$	(5,630)	$	1,322,469	$	1,258,445	$	4,474,313
Changes in ownership interests and related tax benefits	39		—		(20)		(62,709)		—		—		(103,599)		51,984		(114,305)
Issuances of common stock	—		—		1		—		—		—		7,723		—		7,724
Capital contributions	—		—		—		—		—		—		1,034		168,673		169,707
Dividends/distributions	—		—		—		—		(190,504)		—		(129,240)		(26,908)		(346,652)
Net income	—		—		—		—		73,027		—		63,999		66,716		203,742
Currency translation adjustment, net of tax	—		—		—		—		—		(4,850)		(2,932)		(3,608)		(11,390)
Equity compensation	—		—		—		57,600		—		—		34,822		—		92,422
Stock option exercises	1		—		—		1,510		—		—		—		—		1,511
Balance as of March 31, 2024	1,911		35		1,151		2,387,437		(612,560)		(10,480)		1,194,276		1,515,302		4,477,072

Changes in ownership interests and related tax benefits	19		—		(18)		(75,616)		—		—		103,129		(35,192)		(7,678)
Issuances of common stock	27		—		—		354,368		—		—		—		—		354,395
Capital contributions	—		—		—		—		—		—		269		342,937		343,206
Dividends/distributions	—		—		—		—		(195,234)		—		(116,980)		(20,696)		(332,910)
Net income	—		—		—		—		94,938		—		76,211		105,489		276,638
Currency translation adjustment, net of tax	—		—		—		—		—		(1)		55		(1,919)		(1,865)
Equity compensation	—		—		—		55,791		—		—		32,441		—		88,232

Balance as of June 30, 2024	1,957		35		1,133		2,721,980		(712,856)		(10,481)		1,289,401		1,905,921		5,197,090

Changes in ownership interests and related tax benefits	23		—		(21)		27,103		—		—		(3,663)		(31,559)		(8,117)
Issuances of common stock	3		—		—		52,838		—		—		—		—		52,841
Capital contributions	—		—		—		—		—		—		269		32,684		32,953
Dividends/distributions	—		—		—		—		(198,002)		—		(139,098)		(28,898)		(365,998)
Net income	—		—		—		—		118,460		—		96,633		64,241		279,334
Currency translation adjustment, net of tax	—		—		—		—		—		18,931		11,065		6,557		36,553
Equity compensation	—		—		—		54,972		—		—		30,641		—		85,613

Balance as of September 30, 2024	$	1,983	$	35	$	1,112	$	2,856,893	$	(792,398)	$	8,450	$	1,285,248	$	1,948,946	$	5,310,269

See accompanying notes to the unaudited condensed consolidated financial statements.

Table of Contents

Ares Management Corporation

Condensed Consolidated Statements of Changes in Equity

(Amounts in Thousands)

(unaudited)


	Class A Common Stock		Non-voting Common Stock		Class C Common Stock		Additional Paid-in-Capital		Accumulated Deficit		Accumulated Other Comprehensive Loss		Non-Controlling Interest in Ares Operating Group Entities		Non-Controlling Interest in Consolidated Funds		Total Equity
Balance as of December 31, 2022	$	1,739	$	35	$	1,172	$	1,970,754	$	(369,475)	$	(14,986)	$	1,135,023	$	1,074,356	$	3,798,618

Changes in ownership interests and related tax benefits	19		—		34		(36,777)		—		—		87,541		(4,689)		46,128
Issuances of common stock	14		—		—		115,350		—		—		—		—		115,364
Capital contributions	—		—		—		—		—		—		1,172		93,585		94,757
Dividends/distributions	—		—		—		—		(145,386)		—		(103,363)		(20,933)		(269,682)
Net income	—		—		—		—		94,039		—		88,408		26,693		209,140
Currency translation adjustment, net of tax	—		—		—		—		—		2,641		1,756		2,390		6,787
Equity compensation	—		—		—		41,541		—		—		27,537		—		69,078
Stock option exercises	5		—		—		9,175

Ares Management Corp [ARES] Filings
Ares Management Corp [ARES-PB] Filings
10-Q	[2024-11-08]
10-Q	[2024-08-07]
10-Q	[2024-05-09]
10-K	[2024-02-27]
10-Q	[2023-11-06]
10-Q	[2023-08-03]
10-Q	[2023-05-08]
10-K	[2023-02-24]
10-Q	[2022-11-07]
10-Q	[2022-08-05]
10-Q	[2022-05-09]
10-K	[2022-02-28]
10-Q	[2021-11-05]
10-Q	[2021-08-09]
10-Q	[2021-05-06]
10-K	[2021-02-25]
10-Q	[2020-11-06]
10-Q	[2020-08-07]
10-Q	[2020-05-08]
10-K	[2020-02-28]
10-Q	[2019-11-06]
10-Q	[2019-08-01]
10-Q	[2019-05-06]
10-K	[2019-02-26]
10-Q	[2018-11-05]
10-Q	[2018-08-06]
10-Q	[2018-05-07]
10-K	[2018-03-01]
10-Q	[2017-11-06]
10-Q	[2017-08-07]
10-Q	[2017-05-08]
10-K	[2017-02-27]
10-Q	[2016-11-07]
10-Q	[2016-08-09]
10-Q	[2016-05-10]
10-K	[2016-02-29]
10-Q	[2015-11-10]
10-Q	[2015-08-11]
10-Q	[2015-05-12]
10-K	[2015-03-20]
10-Q	[2014-11-12]
10-Q	[2014-08-13]
10-Q	[2014-06-10]
S-1	[2014-03-31]

Ares Management Corp [ARES] Filings

Ares Management Corp [ARES-PB] Filings