Full-year 2022 earnings

• Resilient performance across the board
  • Net inflows of €17 billion
  • Underlying earnings stable at €348 million
  • Revenues down 4% at €1,425 million
• “AXA IM for Progress Monitor”, to report on non-financial KPIs related to AXA IM’s responsibility as a business, investor and employer

“AXA IM delivered a robust operational performance in 2022, adapting to market volatility and turmoil successfully navigating a very challenging macroeconomic and geopolitical environment.

With resilient underlying earnings remaining at a historical high and a very good commercial dynamic translating into strong net inflows driven by third-party clients – fuelled by both AXA IM Alts and AXA IM Core – and our joint ventures in Asia, our operational model has proven its relevance and strength.”

“In such market conditions, our focus has been to get closer to our clients, to understand how this unstable environment could affect their needs and then act to provide them with adequate solutions.” said Marco Morelli, Executive Chairman of AXA IM.

“2022 has been a year of instrumental changes for AXA IM. AXA IM Alts has entered a next stage of solid growth, demonstrating suitability of its offering around four business lines: real estate, infrastructure, alternative credit and natural capital & impact investments. Additionally, we have further enhanced our investment range with the creation of AXA IM Prime, a business unit enabling our clients with an access to private markets and hedge funds, as well as the launch of our new ETF business launched by AXA IM Core. Moreover, the creation of the AXA IM Architas business unit is now also effective with a goal to be the single point of contact for AXA clients and other partners regarding Unit-Linked products.”

“In the wake of 2021, we’ve further enhanced our actions and commitments as a responsible investor, business and employer. As we need to bolster our collective and individual efforts to accelerate the transition towards a sustainable world, the recent launch of the AXA IM for Progress Monitor will provide transparency, via set metrics, on the progress against our ambition to be a leading responsible asset manager.”

“AXA IM is now the central hub for asset management within the AXA Group and we are well placed to enter the next phase of our sustainable growth for the benefit of our clients, employees and society, more broadly.” added Marco Morelli.

Full-year 2022 key highlights

All figures are sourced by AXA IM and are as of end 2022, unless otherwise specified.

Underlying earnings are stable at €348 million¹ , as lower revenues were notably offset by efficiency measures undertaken, higher contributions from the JVs as well as positive ones from AXA IM Prime and CAPZA² .

Net Revenues are down 4% at €1,425 million³ , driven by a decrease in recurring fees due to asset drop and financial markets momentum, as well as lower performance fees, partly offset by the increase of transaction fees in real estate, following significative acquisitions realised in 2022.

Net inflows amounted to €17 billion, driven by third-party clients with alternative and fixed income strategies being in high demand.

These net inflows include:

• €17 billion from third-party clients, with positive inflows from both Alts and Core investment business units, partly offset by €-4 billion from AXA Insurance companies, mainly driven by asset allocation decisions.
• €4 billion from joint ventures in Asia.

Assets under management (AUM) amounted to €824 billion, down 7% compared to the end of 2021, reflecting a significantly negative market effect, despite positive net inflows.

AXA IM Prime’s €17 billion of assets previously directly managed by AXA Group are included in AXA IM’s total AUM.

The underlying cost income ratio stands at 68.5%, up 0.4 points as a result of lower revenues, despite lower costs following strengthened efficiency measures undertaken in 2022.

Solid growth of the alternatives business unit demonstrating suitability of its offering in any market environment

AXA IM Alts brings together real estate, infrastructure, alternative credit and natural capital & impact investments expertises of AXA IM.

• The Alternative business unit recorded €15 billion of net new money⁴ in total.
• Assets under management now stand at €198 billion, up 8% versus year-end 2021.
• Revenues are up 7% at €631 million.

These achievements in a challenging environment demonstrate the strength of AXA IM Alts’ global offering and its ability to adapt to changing market conditions and evolving investor requirements. 40% of the third-party capital was raised from non-European clients, confirming AXA IM Alts’ position as global leader in alternative investments.

AXA IM Alts raised €7.7 billion of net new money in Private Debt & Alternative Credit, with significant inflows into its real estate debt strategies (€3.5 billion), that offer very good risk return profile within the current higher interest rate environment. AXA IM Alts also collected significant amounts of capital for its Dutch mortgages offering (c. €1.1 billion) and notable flows into its US and European managed CLOs (€0.6 billion) as well as its Senior ABS & CLOs (c. €2.1 billion).

AXA IM Alts raised €3.6 billion of net new money for Real Estate Equity strategies, primarily directed towards AXA IM Alts’ core, logistics and residential real estate open ended fund range for institutional clients, with those three vehicles now exceeding €11 billion in gross AUM.

The business unit also raised €3.5 billion of net new money in Infrastructure, its fastest growing pillar. 2022 was a very active year both in terms of capital raised with institutional and retail clients, and in terms of deployment with strategic investments into Hornsea 2 in the U.K., one of the world’s largest offshore wind farms, as well as Lyntia Networks, Spain’s leading fibre business.

AXA IM Alts also strengthened its Private Equity offering through the launch of its €500 million private equity healthcare strategy, now more than halfway through in terms of capital raised. Additionally, the business expanded its Natural Capital platform with the launch of a €500 million strategy focusing on financing activity that protects vulnerable or high value natural habitats from deforestation.

Strong momentum for the Core investment business with third-party clients

AXA IM Core brings together the Fixed Income, Equities, Multi-Asset platforms as well as the ETF business at AXA IM.

• The Core business unit has raised €9 billion of net new money from third-party clients, mainly driven by Fixed Income, more than offset by outflows deriving from the AXA Main Fund.
• Assets under management stand at €482 billion.
• Revenues are down 12% at €774 million.

Implementation of SFDR level II resulted in 78% of eligible funds and strategies being classified as article 8 or 9⁵ .

AXA IM Core’s vast majority of AUM are now fully aligned to NZAMI⁶ commitments and the development of the ACT range⁷ (the most advanced ESG and listed impact strategies) is further prospering, now accounting for €41 billion of AUM.

In a highly volatile environment, Fixed Income gained good momentum from third-party clients with the largest contributions coming from a mix of new portfolios and top ups from institutional clients across a range of strategies. European IG credit strategies were in high-demand, including a new mandate acquisition linked to decarbonisation objectives.

Additionally, green bonds kept traction in both existing strategies and newly launched ones.

Within a risk-off environment impacting inflows, the Equity platform made progress over 2022 with key institutional clients investing in strategies. The thematic range welcomed new additions with the launch of the biodiversity and metaverse strategies and accounts for €14 billion of AUM.

Sustainable Equities strategies from the Equity QI platform recorded good inflows, while product development continued with a new strategy dedicated to the plastic and waste transition.

The Multi-Asset platform has enhanced its operating model including more quant input. Commercial success was registered with retail clients as well as institutional on global overlays and total return strategies.

Leveraging all its investment expertise, the ETF business was launched in 2022 and its AUM now exceeds €1 billion following the launch of three vehicles.

AXA IM Prime, the new Private Market Enabler and Hedge Funds platform

The AXA IM Prime business unit is now operating within AXA IM’s ecosystem, now with €30 billion⁸ of AUM and €5 billion of commitments to be deployed over the next three years.

AXA IM Prime offers diversified sources of Private Market returns through primaries, secondaries, co-investments, as well as NAV financing and GP minority stakes solutions across private equity, infrastructure equity, private debt and hedge funds.

AXA IM Architas, the single point of contact for AXA clients and partners regarding Unit-Linked products and solutions

The creation of the AXA IM Architas business unit is effective since 1 January 2023, and its integration is progressively taking place.

In 2022⁹ , net inflows amounted to €1 billion, with particularly strong commercial success in Asia (€700 million) with the majority of inflows deriving from AXA’s clients in Japan and Indonesia.

AUM now stand at €29 billion.

Launch of the “AXA IM for Progress Monitor” to report on non-financial KPIs related to our responsibility as a business, investor and employer

AXA IM has recently launched the “AXA IM for Progress Monitor”¹⁰ , a set of metrics providing transparency and progress towards non-financial targets, contributing to AXA IM’s ambition of becoming a leading responsible asset manager.

In 2022, AXA IM furthered its initiatives pertaining to ESG:

As an investor:

• The voting policy¹¹ was strengthened, to further integrate ESG issues into voting decision and pay particular attention to climate change issues. Key updates included the integration of meaningful ESG metrics in CEO pay, and ESG capabilities of Boards, which led us to oppose 538 remuneration-related proposals and 24 directors’ re-election.
• New  sustainable strategies were launched in fixed income, equities, private equity  and through ETF.
• The number of engagement initiatives more than doubled vs 2021, and the first round of engagement with companies identified as climate laggards was conducted.
• Net zero targets were revised in May as part of its NZAMI commitment, with now 65%¹² of AXA IM’s total assets under management managed to be in line with Net Zero.

As a business:

• The first global carbon footprint reporting was published, including Scope 3 emissions.
• The 2022 AXA IM Research Award was attributed to Dr. Ana Queiros for her work on blue carbon as a nature-based solution.
• The impact philanthropy commitment to donate 5% of the impact range’s fees to several charities supporting education, biodiversity & climate and health initiatives was perpetuated.

As an employer:

• The global EDGE Move certification was received, as a recognition of AXA IM’s progresses towards a more gender-equitable workplace.
• C. 40 positions filled were ESG-related out of the +560 people hired.

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