Key figures
On Friday 28th of July, Amundi publishes its results for the second quarter of 2023, with net income of 320 M€1,2 up +19% vs. Q2 2022.
This result is explained by improved margins and good cost control. A good adaptation of the offer to the needs of investors, who are still mostly risk averse, has also resulted in a good commercial dynamic with positive inflows both in medium-long-term assets and in treasury products.
Assets under management reach €1,961bn at 30/06/2023, up on the quarter and over one year.
Persistent risk aversion
Investors maintained a cautious approach, resulting in weak inflows on the asset management market in Europe, with inflows in open-ended funds3 coming out slightly positive, +€23bn in the second quarter, driven by treasury products (+€8bn) and passive management (+€39bn), while medium- and long-term active management saw outflows over the quarter and half-year.
A high level of income in the second quarter
In the second quarter of 2023, adjusted net income4 reached €320m, up +19.0% versus Q2 2022, and +6.7% compared to Q1 2023.
This high level of profitability stems from an increase in revenues, despite rampant risk aversion, and a further improvement in operating efficiency, resulting in a more moderate increase in expenses than in revenues, despite an inflationary environment.
Adjusted net revenues4 rose to €823m, up +9.2% compared to Q2 2022, and +3.7% compared to Q1 2023, based on:
- The increase of adjusted net revenues4 to €823m, up +9.2% compared to Q2 2022, and +3.7% compared to Q1 2023.
- Net management fees increased year-on-year up +1.6% year-on-year
- Strong performance on Amundi Technology's revenues (+31% compared to Q2 2022), following the trend of previous quarters and confirming the development of this activity;
- Performance fees (€51m) whose more than doubled compared to Q2 2022 (€24m), ;
- And finally, financial and other income was positive (€13m).
Very strong control of operating expenses4 (€430 million) resulted in an increase of just +2.1% in costs compared to the second quarter of 2022, much lower than the increase in revenues.
As in previous quarters, inflation (at 5.5% year-on-year in the eurozone5 for example) and development investments were largely absorbed by productivity gains and the continued synergies generated by Lyxor's integration.
In the second quarter, on an annual basis, more than 80% of the final target of €60m in synergies were achieved, ahead of schedule announced at the time of the acquisition.
In addition to synergies, cost control continued to reflect Amundi's agility in adjusting its cost base, reflected in a cost/income ratio among the best for the sector: 52.3%, adjusted data4.
Net earnings per share in the second quarter 2023 reached €1.50.
First-half results also positive
In the first half of 2023, adjusted net income amounted to €620m, up +4.5%, reflecting the same trends as in the second quarter:
- An increase adjusted net revenue 1.8% versus the first half of 2022, driven like in the second quarter by financial and other income driven like in the second quarter by financial and other income;
- Adjusted expenses4 were well under control, at €856m.
Adjusted gross operating income4 totalled €762m, up +2.3% compared to the first half of 2022.
Net earnings per share in the first half of 2023 amounted to €2.90.
Positive inflows, both in Medium/Long-Term Assets and treasury assets, in a risk-off environment
Amundi's assets under management at 30 June 2023 rose +1.9% year-on-year (compared to end-June 2022) and +1.4% quarter-on-quarter (compared to end-March 2023) to €1,961bn.
In the second quarter, the European asset management market was impacted by the risk-off environment, posting very modest total inflows, and also by significant outflows from active management. Against this backdrop, Amundi generated positive inflows, both in Medium/Long-Term Assets assets6 and treasury products, in the Retail and Institutional segments.
In total, inflows amounted to +€3.7bn, of which +€2.2Bn in Medium/Long-Term Assets, +€2.4bn in treasury products, and outflows of ‑€0.9bn for the JVs7 due entirely, like in the first quarter, to redemptions by large institutions at ABC-CA (China).
By client segment, Retail: posted positive inflows of +€2.1bn, reflecting the particularly high level of risk aversion for this client base, The Institutional segment also posted positive inflows, at +€2.4bn.
Continuation of development initiatives
Amundi is forging ahead with the Ambitions 2025 development plan:
- Amundi Technology saw its revenues increase by more than 30% in the quarter and the half-year compared to the same periods last year, gaining 3 new clients over the quarter (in Europe outside France) and 7 over the half-year (including 6 outside France);
- In India, the SBI MF JV maintained very strong development, with a high level of inflows and net income over the quarter;
- In Responsible Investment, the range of funds in line with the Net Zero8 trajectory now covers five asset classes, with the objective of achieving a comprehensive range by 2025, and the share of ESG ETFs reached 30% of the range9, compared to 27% at the end of 2022 and on track to achieve the 40% target by 2025.
Valérie Baudson, Chief Executive Officer, said:
Amundi posted a very strong financial performance in the second quarter, despite persistently uncertain markets. Its net income increased by +19% compared to the second quarter of 2022, to €320 million thanks to top line growth and very good cost control in an inflationary environment.
We were able to adapt our offer to meet the needs of investors, who are still predominantly risk-averse. This resulted in robust sales momentum, with positive inflows in both medium- and long-term assets and treasury products.
At the same time, we continued our development, gaining new clients for Amundi Technology and expanding our Responsible Investment offering
1 Net income Group share.
2 Adjusted net attributable profit in the second quarter of 2023 compared to the second quarter 2022.
3 Sources: Morningstar FundFile, ETFGI. European & Cross-border open-ended funds (excluding mandates and dedicated funds). Data at end-June 2023.
4. Adjusted data: excluding amortisation of intangible assets and Lyxor integration costs in 2022.
5 Source: Eurostat, 6.8% in core inflation.
6 Excluding JVs.
7 Net inflows include assets under advisory, marketed assets and funds of funds, including 100% of the net inflows of the Asian JVs; for Wafa Gestion in Morocco, net inflows are reported for Amundi's share in the JV's capital.
8 All passively managed Net Zero Ambition funds meet EU CTB/PAB criteria.
9 As a percentage of the number of ETFs managed.