Full-year 2020 earnings
- Strong growth across the board:
- Underlying earnings up 6% at €279 million
- Revenues up 4% at €1,294 million
- Net inflows up €40 billion including third-party inflows of €18 billion
- Assets under management of €858 billion
- Responsible investment at the heart of all activities
- 5% of the impact fund range’s fees donated to several charities supporting education, biodiversity & climate and health initiatives
“AXA IM has recorded an excellent performance in 2020, in what has truly been an exceptional and challenging year for the industry, businesses and individuals. Our diversified and global approach based on solid convictions has been instrumental in navigating through the uncertain market environment. We are posting strong operational performance, fueled by both AXA IM Alts and AXA IM Core across all client segments, with underlying earnings up 6% overall.”
“Our new organisation and focused commercial efforts are bearing fruit, as reflected by our increased revenues, up 4%, with growth seen across all business units.”
“Our assets under management are significantly increasing and have reached a record high of €858 billion, hitting one trillion in USD for the first time. This has been mainly driven by dynamic sales efforts leading to robust positive net inflows, including from third parties,” said Marco Morelli, Executive Chairman of AXA IM.
“In this challenging environment, responsible investing has become even more central to our business priorities. We are relentlessly pursuing our efforts in this area to help our clients, our people and the world to prosper, through the investments we manage and the influence we have as investors. Climate change in particular represented our largest area of engagement in 2020.”
“Additionally partnerships such as the one we formed with the Access to Medicine Foundation, are critical to combatting health crises across the globe, and by investing for impact we believe we can create long term and positive change. Following the commitment we made to donate 5% of our impact fund range fees to charities, we are very proud to announce that we have teamed up with several NGOs and foundations which support projects centred on education, biodiversity & climate and health.”
“This past year has evidenced the importance of active management in volatile markets, this has been a very strong year of investment performance across our business. We have stayed committed to our clients, developed new business, launched new products and hired and promoted talent. I would like to thank all of our colleagues who have worked hard to deliver these results, as well as our clients for their invaluable trust. I am convinced that the strategic initiatives we have undertaken will continue to foster future growth.” added Marco Morelli.
Full-year 2020 key highlights
All figures sourced by AXA IM and are as of end 2020, unless otherwise specified.
Underlying earnings were up 6% to €279 million1, driven by higher revenues.
Revenues were up 4% at €1,294 million2, driven by higher management fees.
Net inflows amounted to €40 billion, driven by all client segments, and including third-party3 net flows of €18 billion, with Fixed Income and Real Assets strategies being in high demand. ESG-integrated assets accounted for approximately a third of third-party net inflows overall.
- AXA IM Core registered €17 billion of net inflows mostly in Fixed Income, AXA IM Alts brought in €12 billion through Structured Finance and Real Assets.
- AXA IM’s joint ventures in Asia contributed €10 billion in net new money inflows.
Assets under management amounted to €858 billion, up €57 billion compared to the end of 2019, reflecting net inflows and positive market effects.
Continuation of the strong commercial momentum for the Alternatives business unit with €14.6 billion of capital raised4 and €159 billion of assets under management
AXA IM Alts brings together real estate equity, private debt & alternative credit, private equity, infrastructure and hedge funds expertise at AXA IM.
The Alternatives business unit has raised more than €14.6 billion of capital in 2020 overall, largely directed towards Real Estate Equity and Private Debt and Alternative Credit, two of the pillars of AXA IM Alts where it holds market leading position (#1 Real Estate Manager in Europe5 and #2 capital raiser in private debt worldwide6). Capital primarily came from institutional investors across Europe, North America and Asia Pacific, with AXA IM Alts’ assets under management now standing at €159 billion, up 14%, reflecting the commercial success and relevance of AXA IM Alts’ offering, in a persistent low rate environment.
AXA IM Alts raised €9.4 billion in Private Debt & Alternative Credit, with large inflows in its real assets debt strategies (€4.0 billion), with notably a €1.25 billion infrastructure debt mandate on behalf of two Dutch pension funds and the closing of its second comingled fund, European Infrastructure Debt (Floating) 2, with over €1.0 billion capital raised. AXA IM Alts also collected significant amount of capital across its structured finance product range and notably Senior ABS & CLO (€3.0 billion), including through the launch of its 11th CLO deal in the US, Dutch Mortgages (€1.1 billion) as well its Capital Solutions Transactions, with the launch of the 8th generation of its Partners Capital Solution series and its Secured Finance strategy7 .
AXA IM Alts raised €3.7 billion for Real Estate Equity strategies with €2.1 billion directed to its real estate open ended fund range, the largest being its flagship pan-European core diversified strategy which sits alongside its recently launched logistics and residential sector focused funds.
The business unit also raised €1.3 billion in Private Equity and Infrastructure, particularly with the acquisition of Kadans Science Partner platform in November, the continuous expansion of its infrastructure equity and private impact activities, and the launch of an innovative open ended infrastructure fund allowing retail investors to invest into infrastructure through their life insurance contracts.
Strong business momentum for the Core investments business unit, with €17 billion of net inflows and €559 billion of asset under management
AXA IM Core brings together the Fixed Income, Framlington Equities, Rosenberg Equities and Multi-Asset platforms at AXA IM.
The Core business unit has raised €17 billion of net new money, of which €11 billion from third party clients. AXA IM Core’s assets under management now stands at €559 billion, up 5% vs year-end 2019. AXA IM Core’s commercial success is for a large part attributed to a refocus of commercial efforts to support the growth of its blockbuster strategies and the creation of new ones.
Fixed Income recorded very strong inflows and commercial momentum. Notably, this was driven by Buy & Maintain strategies, as well as total return strategies within the active fixed income business which demonstrated strong ability to navigate volatile markets. ESG-integrated strategies were in high demand, with significant inflows for green bonds.
US High Yield saw significant appetite from clients following the market downturn in March, and this appetite has continued. A high yield strategy dedicated to low carbon investments will be launched during the first half of 2021.
When it comes to equities:
- The Thematics fund range from AXA IM Framlington Equities benefited from a newly-launched strategy and commercial successes across the Robotech, Digital Economy and Clean Economy strategies. This range now accounts for more than €11 billion of assets under management. In addition, the development of ESG-integrated and sustainable equity solutions continues.
- AXA IM Rosenberg Equities has successfully completed its integration within the AXA IM Core business unit which now benefits from its data science methodologies including an innovative natural language processing framework. The Sustainable Equity flagship strategy was particularly successful, and the sustainable fund range will be further expanded in 2021.
On the Multi-Asset side, the teams continued to innovate and enrich the product offering with the launch of the first Multi-Asset impact strategy8 aiming to invest in companies that are “good for the planet and good for the people”, building on AXA IM’s pioneering responsible investment capabilities. A new range designed according to client’s risk profile had a successful and promising launch and met with strong client demand in Belgium. The team also showed commercial success with its overlay strategies on the institutional side.
Overall, 89% of AXA IM Core’s assets under management are now fully ESG-integrated.
Responsible investment at the heart of all our activities
Responsible Investment (RI) capabilities were further embedded within AXA IM’s business units, AXA IM Alts and AXA IM Core, in 2020. RI and sustainability are now fully embraced by all investment teams which perform RI-related activities as part of their day-to-day.
To further clarify AXA IM’s offer and comply with regulatory changes, the RI strategies are now organised in two distinct ranges:
- the ESG-integrated range (€555 billion of assets under management9): these assets incorporate ESG into the investment process to help achieve risk-adjusted returns. Funds in this range have ESG scoringand research at all stages of the investment process and are part of the stewardship initiatives. Most of the funds in this range have been assigned an ESG score objective10.
- The Act range (€22 billion of assets under management): these assets invest with a purpose to support the transition to a more sustainable economy. Funds have been assigned thematic ESG and/or UN’s Sustainable Development Goals (SDGs) objectives. Active stewardship is a key focus for this range, with voting and engagement reporting available at fund level. This range encompasses sustainable and listed impact funds.
Stewardship and engagement activities are central to AXA IM responsible investing approach, in order to actively power the transition to a more sustainable world. Climate change represented the largest area of our engagement activity in 2020, while human capital and diversity initiatives were also at the forefront with the implementation of a new gender diversity voting policy11, and the launch of the 30% Club Investor Group in France12.
The partnership with the Access to Medicine Foundation enabled AXA IM to drive investor pressure on companies in the healthcare sector, pushing for solidarity and the sharing of manufacturing capacity in the fight against Covid-19 around the world.
AXA IM also made a significant commitment in its own climate journey, being among the first asset managers pledging to reach net zero greenhouse gas emissions by 2050 across all assets, as well as decreasing its own CO2 emissions by at least 25% by 202513.
AXA IM also enjoyed recognition for its RI pledges and was named by Hirschel & Kramer14 the top asset manager in the Avant-Gardist category for its commitment to responsible investment and the ability to embed RI approaches in its brand. In addition, AXA IM was part of the 2020 UN Principles of Responsible Investment (PRI) Leaders’ Group for its approach to climate change.
5% of impact fund range’s fees donated to several charities supporting education, biodiversity & climate and health initiatives
In 2020, AXA IM announced a donation of 5% of its impact fund range fees to support charities that focus their action on themes which are at the heart of our Corporate Responsibility and Responsible Investment strategies and in alignment with selected UN SDGs.
Four beneficiaries compose the newly formed charity portfolio for 2021, spanning education, climate, biodiversity and health:
- Education: the Epic Foundation, supports high impact organisations in order to catalyse their action on underserved children and youth and the systems affecting their lives across Europe, Asia, the Americas and Africa.
- Biodiversity & Climate:
- World Land Trust, a conservation charity that protects the world’s most biologically significant and threatened habitats.
- Ligue pour la Protection des Oiseaux, focused on national biodiversity restoration projects for France’s threatened birds, coordination of European species conservation programmes and management of reintroduction of endangered birds.
- Health: Doctors with Africa CUAMM, who cooperates with local hospitals, health centers, villages and universities, to improve the health conditions of the most vulnerable communities of Sub-Saharan Africa.
The value of investments, and the income from them, can fall as well as rise and investors may not get back the amount originally invested.
- At constant FX.
- Revenues net of distribution fees.
- Third-party flows do not include JVs.
- Sum of new gross capital commitments from investors.
- INREV Fund Manager Survey, June 2020. #1 Real estate manager headquartered in Europe based on total assets under management.
- Private Debt Investor (PDI) 50 Global Annual Review, December 2020. Ranking based on capital raised over five years.
- Closed-ended products that went through their final close in 2020, meaning that no additional subscription is possible.
- See: https://media.axa-im.co.uk/content/-/asset_publisher/4omegrCMgrgh/content/axa-im-launches-its-first-multi-asset-impact-fund/26049
- Excluding JVs.
- See: https://www.axa-im.com/responsible-investing/our-approach-and-offering
- See: https://www.axa-im.com/content/-/asset_publisher/alpeXKk1gk2N/content/axa-im-to-expand-its-gender-diversity-voting-policy-for-both-developed-and-emerging-market-economies/23818
- See: https://www.axa-im.com/content/-/asset_publisher/alpeXKk1gk2N/content/six-asset-managers-call-on-french-large-caps-to-establish-action-plan-to-have-at-least-30-women-in-executive-management-teams-by-2025/23818
- See: https://www.axa-im.com/content/-/asset_publisher/alpeXKk1gk2N/content/axa-im-to-join-the-net-zero-asset-managers-initiative-and-to-commit-to-net-zero-emissions-goal/23818
- See: https://www.axa-im.com/content/-/asset_publisher/alpeXKk1gk2N/content/axa-im-named-as-the-top-investment-manager-in-europe-committed-to-responsible-investing/23818