Amundi's results remained high, confirming its business model is solid. The impact of the market downturn on revenues was countered by the reduction in operating expenses, which kept the cost/income ratio low and profitability high.
Q3 20203
Total net revenue (€630m) was down compared to Q3 2019 (-4.1%) but higher vs. Q2 2020 (+0.8%); these differences were attributable in large part to the market situation.
- As such, net management fees were:
- down compared to Q3 2019 in light of the decline in average market levels (CAC 40 down 10% Q3/Q3) and the pressure on margins (change in the product/client mix), in line with previous quarters;
- up compared to Q2 2020 thanks to the integration of Sabadell AM and rising market averages (+7% for the CAC 40 Q3/Q2 average).
- Performance fees were maintained at a good level (€30m vs. €25m in Q3 2019).
Operating expenses were down markedly (€323m or -3.8% vs Q3 2019), thanks to continuing cost-cutting efforts, lower travel and marketing expenses due to the pandemic and the adjustment of variable remuneration. The slight rise relative to Q2 2020 is due to the full consolidation of Sabadell AM.
The operating expenses to average AuM ratio (excl. JVs) remains one of the lowest in the industry at 9.2bp.
Consequently, the cost/income ratio stood at 51.2%, stable compared to Q3 2019.
Taking into consideration the improved contribution to €17m from equity-accounted entities (primarily the Asian joint ventures) and the tax charge, adjusted net income, Group share, totalled €235m (+2.3% vs. Q3 2019 and +1.0% vs. Q2 2020).
First nine months of 20203
Total revenues were €1,866m (-6.2%) primarily due to the market slump’s strong negative effect on financial earnings, which fell from €34m (9M 2019) to -€46m (9M 2020). The trend in net asset management fees stemmed from lower average equity market levels and a less-favourable client/product mix. Performance fees increased (€106m, +24% vs. 9M 2019).
With operating expenses down (-4.4%), the cost/income ratio came to 52.0%, and Gross Operating Income was €895m.
After the contribution from equity-accounted entities (primarily the Asian joint ventures), which increased sharply (+39.5% vs. 2019) and tax expenses, adjusted net income, Group share was maintained at a solid level at €674m (-8.3% vs. end-September 2019). Excluding the impact of the market downturn, it was comparable to that of the first nine months of 2019.