Amundi SA posted inflows that surpassed analysts’ estimates, as the asset manager’s better-than-expected expense controls boosted second-quarter profit.
(Bloomberg) — Amundi SA posted inflows that surpassed analysts’ estimates, as the asset manager’s better-than-expected expense controls boosted second-quarter profit.
Clients added €3.7 billion ($4.1 billion) in the three months through June, according to a statement Friday, slightly more than the €3.5 billion average estimate among analysts surveyed by Bloomberg.
The firm attracted investors by adapting its products to meet the needs of more risk-averse clients, and intends to continue that strategy in the near-term, according to Chief Executive Officer Valerie Baudson.
“I think things are likely going to stay relatively stable in the coming months,” Baudson said in a call with reporters, referring to customers’ current stance. “I don’t see any reason for them to deteriorate, nor do I see any for them to improve very suddenly either.”
Medium-term and long-term products posted inflows of €2.2 billion, driven by Amundi’s ETF, active bond management and structured products. Clients looking for safer products also parked their funds in Amundi’s treasury offerings, which saw inflows of €2.4 billion.
The inflows echo the performance recorded by the firm’s competitors in a mixed quarter. In the US, BlackRock Inc.’s assets under management rose to $9.4 trillion as of the end June, even as inflows into its long-term investment products, at $57 billion, missed analysts’ estimates. In Europe, Deutsche Bank AG’s DWS unit posted a second consecutive quarter of inflows.
Amundi’s inflows, combined with positive market and currency effects, lifted assets under management 1.9% from a year earlier to €1.96 trillion.
Cost-controls, synergies
The Paris-based company’s expense controls were better than analysts predicted, contributing to a 19% surge in adjusted net income to €320 million. Analysts had estimated €297 million.
At 52.3%, the firm’s adjusted cost-to-income ratio beat analysts’ average expectation of 53.8% and fell below the 53% objective it set for itself for 2025. The money manager said it completed 80% of the €60 million synergies it targeted from the integration of Lyxor, ahead of schedule.
In Asia, a key region for Amundi where it aims to have €500 billion in assets by 2025, the firm saw clients pour in €900 million over the period, after several quarters of outflows as Chinese clients turned risk averse and pulled their funds. The firm’s Asian assets under management stood at €376 billion at the end of June.
Showing optimism, Baudson signaled the worst could be over for Amundi’s foray into the Chinese market.
“We observed that the situation gradually stabilized over the second quarter,” Baudson said. “We see the trend improving.”
As part of its 2025 strategic plan, Amundi earmarked €2 billion in excess capital through that year for exceptional payouts or mergers and acquisitions. For the time being, the firm remains focused on the assessment of potential opportunities, Deputy CEO Nicolas Calcoen said on the call.
“It’s only in 2025 — if we haven’t found the occasion to use the excess capital in a value-creative way via M&A — that we’d ponder how to return it in another way,” Calcoen said.
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