Financial Data and Key Metrics Changes - Ares Management reported a quarterly dividend of $1.12 per share, representing a 20% increase compared to the same quarter last year [4] - The company achieved a record management fee of $900 million, reflecting a 24% year-over-year increase [33] - Fee-related earnings (FRE) for the quarter were $409 million, marking a 26% year-over-year growth, with FRE margins at 41.2% [35] Business Line Data and Key Metrics Changes - The total assets under management (AUM) increased to $572 billion, showing a quarter-over-quarter organic growth of 19% on an annualized basis [8] - Fee-paying AUM (FPAUM) rose to $350 billion, representing a quarter-over-quarter organic growth of 17% on an annualized basis [9] - The secondaries business saw a 29% increase in AUM to nearly $34 billion, with $2.5 billion raised during the quarter [16] Market Data and Key Metrics Changes - In the U.S. direct lending market, the company experienced a year-over-year comparable EBITDA growth of 13% with a low loan-to-value ratio of 43% [25] - European direct lending showed strong performance with a loan-to-value ratio of 49% and interest coverage of 2.3x, indicating healthy credit quality [70] - The company raised over $1.3 billion in infrastructure, including $850 million for its first Japan data center development fund [15] Company Strategy and Development Direction - Ares Management is focused on expanding its wealth distribution network, now partnering with over 80 firms globally, a 33% increase year-over-year [19] - The company is optimistic about the growth potential in the data center and digital infrastructure sectors, leveraging its recent GCP acquisition [30] - Ares aims to capitalize on the increasing demand for private credit and alternative investments, particularly in the wealth channel [41] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of the business amid market volatility, with strong fundraising and investment performance [7] - The company anticipates a strengthening transaction market environment in the third quarter, supported by lower short-term rates and significant private equity dry powder [28] - Management highlighted the importance of maintaining a balance between capital growth and quality deployment to mitigate risks [60] Other Important Information - The integration of GCP is progressing well, with expected synergies contributing positively to the financial outlook [32] - The company reported a net accrued performance income balance of $1.1 billion, an 8.5% increase from the previous quarter [10] - Ares Management's insurance platform, Aspida, generated over $1.9 billion in new premiums during the quarter, indicating strong demand [22] Q&A Session Summary Question: Discussion on private credit and institutional demands - Management noted that while private credit fundraising has been down sequentially, Ares continues to see institutional appetite for private credit, maintaining fee structures despite market pressures [47][49] Question: Opportunities in alternative investments - Management emphasized their commitment to democratizing access to alternative investments and readiness to offer products as the market opens [56][58] Question: Update on deployment pipelines - Management expressed confidence in the growing pipelines across various business segments, including direct lending and real estate, despite market fluctuations [64] Question: Comparison of European and U.S. direct lending markets - Management indicated that European markets are becoming more attractive due to different rate trajectories, with credit quality remaining stable across both regions [70] Question: Investment in distribution and partnerships - Management confirmed ongoing investments in product development and distribution efforts, particularly in international markets, to drive growth [76][78]