Key Figures
Bullish markets, but the European asset management market is still slow
Since the beginning of 2024, both equity1 and bond2 markets extended their rally of the end of 2023. However, investors remain strongly risk-averse in the asset management market in Europe, which is reflected by an idling of inflows in open-ended funds3. As in the previous quarter, net inflows were mainly driven by treasury products and passive management, while net flows in medium-long term active management remained negative.
The beginning of the year was marked by two important external operations
The acquisition of Alpha Associates by Amundi, announced4 at the publication of the annual results in early February, was finalised on 2 April. Alpha will be integrated starting in the second quarter, with assets under management reaching €9 billion at the end of March 2024. This operation strengthens our expertise and creates a European leader in the field of multi-management of private assets.
A memorandum of understanding4,5 was signed on 15 April with Victory Capital, a US asset manager, to establish a strategic partnership aimed at combining our activities in the United States into Victory Capital, in exchange for a 26.1% economic stake for Amundi in Victory Capital and 15-year reciprocal international distribution agreements.
These operations aim to accelerate the Group’s organic development, which reached new milestones in the first quarter
In Asia, assets under management increased sharply, by +6% in the quarter alone, reaching €422bn, with net inflows of +€6.8bn from Asian JVs (in particular in India and Korea), and also from the other countries where Amundi is located (China, Hong Kong, Singapore, Japan).
Contrary to the trend in the European fund market, our actively-managed solutions6 showed positive inflows in the first quarter, at +€1.3bn, excluding JVs, thanks to a very good sales momentum in bond strategies
Passive management recorded strong net inflows in ETFs (+€5.0bn), bringing assets under management to €227bn at the end of March 2024.
Third-party Distribution recorded its highest level of activity in two years, with net inflows of +€7.0bn, and assets under management now reaching €345bn, i.e., more than 53% of the Retail segment.
Amundi Technology saw its revenues increase by +35.7% year-on-year, with 61 clients at the end of March 2024.
Lastly, in Responsible Investment, Amundi’s subsidiary CPR AM launched the first thematic strategy on biodiversity with major institutional players; this first fund will allow the roll-out in 2024 of new strategies on this theme for retail clients; Amundi also launched, with IFC, a World Bank subsidiary, a fund for the development of Sustainable Bonds markets in emerging countries: nearly €0.5bn was mobilised with major institutional clients; this initiative confirms our position as one of the world’s leaders in blended finance projects on post-project transition issues carried out with supranational agencies, IFC, EIB or AIIB.
High and diversified inflows, by main client segments, geographies and types of management
As of 31 March 2024, our assets managed reached their highest level ever, at €2.116 trillion, up +9.4% year-on-year (compared with the end of March 2023) and up +3.9% over the quarter. They are driven by market dynamics, a positive foreign exchange effect, as well as net inflows, which reached +€53.5bn over 12 months to the end of March 2024.
In Q1 2024, Amundi generated high net inflows of +€16.6bn, balanced by main client segments, by expertise and by geography, a sign of the success of our expertise across its whole range of solutions.
By client segments, net inflows reached +€6.5bn for Retail, +€5.6bn for the Institutional segment and + €4.5bn for JVs.
By major asset classes and excluding JVs, treasury products (+€8.7bn) benefit from the attraction of high short-term interest rates. MLT Assets7 (+€3.4bn) also experienced a good level of inflows, balanced by types of management:
Finally, by geography, Europe collected net inflows of +€12.8bn, Asia +€6.8bn and the Americas +€1.0bn.
A Profitability at a high level in Q1
In Q1 2024, the adjusted net income8,9 reached €318m, up +5.9% compared to Q1 2023. This growth was fuelled by a significant increase in revenues, up +3.8% compared to Q1 2023, to €824m.
Net management fees experienced a high growth of +4.0% compared to Q1 2023, driven by the increase in average assets under management (excluding JVs) of +5.9%, in a context of market appreciation; however, net inflows were concentrated on less risky products.
Performance fees went down to €18m.
Technology revenues, up +35.7% to €18m, benefited from the addition of new clients over the past year, and the increase in license fees.
Finally, net financial income rose very strongly, by +43.1% to €23m, driven by the increase in short term rates, which gained +130bp8 between Q1 2023 and Q1 2024.
Operating expenses (€439m) remained controlled, at +3.3% compared to Q1 2024, below the growth in revenues over the same period (+3.8%), thus giving rise to a positive jaws effect. The continuous productivity efforts have absorbed the acceleration in investments for the development of Amundi Technology.
This jaws effect results in an improvement in the cost-income ratio, at the best level in the sector at 53.3%8.
It also translates into an acceleration in the growth of Adjusted Gross Operating Income8 (GOI), up +4.4% compared to Q1 2023, to €385m.
Income from equity-accounted companies, at €29m, also increased, by +30.2% compared to Q1 2023, mainly thanks to the continued strong growth of our JV in India.
Adjusted Net Earnings per Share8reached €1.55 in Q1 2024.
Valérie Baudson, Chief Executive Officer, stated:
“We had a particularly intense start to the year, both in terms of sales momentum and the development according to our strategic priorities. We were able to combine organic and external growth, in line with our 2025 Strategic Ambitions plan.
Our net inflows, which reached +€17 billion, are very balanced across the main client segments, expertise and geographies. This shows the good positioning of our range of solutions, which allows us to respond effectively to the needs of our clients. Our assets under management reached their highest level ever, at more than €2,100bn.”
“This activity is also reflected in our profitability: the net income8,9 for the first quarter, at €318m, is up +6% year-on-year, driven by the increase of our net management fees and the control of our costs.
Finally, two external growth operations that are significant for our future development mark the beginning of the year. The acquisition of Alpha Associates is now finalised, three months ahead of schedule. Starting in the second quarter, our clients will therefore benefit from new high-performance solutions in the multi-management of private assets. Secondly, the partnership11 with the US manager Victory Capital will strengthen our presence in the United States and our US asset management expertise. It also brings strong value creation for our clients and our shareholders.
These initiatives, combined with our sustained organic investments, are promising for our future business and results.”
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1. Composite Index: 50% MSCI World + 50% Eurostoxx 600 for Equity Markets
2. Bloomberg Euro Aggregate for Bond Markets
3. Sources: Morningstar FundFile, ETFGI. European & cross-border open-ended funds (excluding mandates and dedicated funds). Data as of end of March 2024.
4. For more details on these operations, please refer to the press releases and the presentations to investors, available on the website www.about.amundi.com
5. Non-binding Memorandum of Understanding at this stage, subject to due diligence and negotiation of final agreements. Final agreements will be subject to the usual finalisation conditions and regulatory approvals. There is no guarantee that the parties will reach an agreement on the final documents and, if they are concluded, that the transactions will be carried out.
6. Excluding structured products, real and alternative assets
7. Medium/Long-Term Assets
8. Adjusted data: excluding amortisation of intangible assets
9. Attributable net income