Future owners of Venetian report higher fourth-quarter earnings

Apollo Global Management Inc., one of the buyers of The Venetian, Palazzo and Venetian Expo, reported record earnings Friday.

In a conference call with investors, Apollo CEO Marc Rowan said the company is “running on all cylinders” and will only get stronger after its Jan. 1 acquisition of Athene Holding Ltd., a retirement services company that issues, reinsures and acquires retirement savings products.

But executives did not discuss the pending $6.4 billion acquisition of Las Vegas Sands Corp.’s Las Vegas assets during the hour-long conference call.

The New York private equity firm, founded by real estate investor and former CEO Leon Black, is in the midst of the acquisition after the Nevada Gaming Control Board on Feb. 2 unanimously recommended approval of the transaction. The Nevada Gaming Commission is expected to consider final approval Thursday.

“2021 was an exceptional year for Apollo,” Rowan told investors. “We generated record annual distributable earnings, underpinned by record fee-related earnings that grew 15 percent year-over-year despite significant investments in our talented team to capture the massive growth opportunity in front of us.”

Rowan said the company remains confident in its ability to execute a strategic vision and financial plan outlined at the company’s Investor Day in October.

“Since then, we’ve demonstrated meaningful progress on our three key bets, including expanding asset origination, establishing product and distribution capabilities to serve retail investors, and growing our capital solutions business,” Rowan said. “Upon completing the merger with Athene on Jan. 1, we enter 2022 with great momentum, fully-aligned and well-positioned to deliver differentiated growth and returns.”

Apollo reported net income of $612.5 million, 91 cents per share, on revenue of $1.195 billion for the quarter that ended Dec. 31. A year earlier, Apollo reported net income of $1.075 billion, $1.80 per share, on revenue of $1.296 billion.

For 2021, Apollo reported net income of $4.268 billion, $7.32 a share, on revenue of $5.952 billion. That compares with net income of $466.8 million, 44 cents a share, on revenue of $2.354 billion in 2020.

Apollo declared a cash dividend of 40 cents per share of its common stock for the fourth quarter. The dividend will be paid on Feb. 28 to shareholders of record at the close of business on Feb. 18. Apollo intends to distribute to its common stockholders an annual dividend of $1.60 per share of common stock, with increases based on growth of the business, as determined by the board of directors.

Many of the details of Apollo’s acquisition of Sands assets were detailed in a two-hour Control Board hearing last week.

David Sambur, co-head of private equity for Apollo, and Venetian President and Chief Operating Officer George Markantonis, who will be the CEO of the new subsidiary operating the property, told regulators the nucleus of Venetian’s management team would be retained by Apollo and they expect all employee pay and benefits programs to remain.

The company anticipates meetings and convention industry operations — a core of The Venetian business plan — will strengthen and provide growth opportunities as business rebounds after the pandemic.

Under terms of Apollo’s acquisition deal, it would pay $1.05 billion in cash and $1.2 billion in seller financing in the form of a term loan credit and security agreement.

New York-based Vici Properties Inc., a real estate investment trust affiliated with Caesars Entertainment Inc., is paying $4 billion in the transaction.

Sands is exiting the Las Vegas market believing that its financial future rests with its investments in Macao, where it is the market leader, and Singapore. The company also is focused on other domestic investments in the United States with prospects in New York, Florida and Texas.

In volume nearly twice the daily average, Apollo shares, traded on the New York Stock Exchange, closed down $4, 5.7 percent, to $65.67 a share on Friday. After hours, shares rebounded 40 cents, 0.6 percent, to end at around $66.07 a share.

The Review-Journal is owned by the family of Dr. Miriam Adelson, the majority shareholder of Las Vegas Sands Corp., which operates The Venetian and Palazzo.

Contact Richard N. Velotta at rvelotta@reviewjournal.com or 702-477-3893. Follow @RickVelotta on Twitter.