Amundi Q2: Strong Growth in Performance Fees

Narrow-moat Amundi reported a net profit of EUR 448 million for the second quarter of 2021, which, however, included a capital gain of EUR 114 million. Adjusted net profit of EUR 345 million was 48% higher than what Amundi reported a year earlier for the second quarter. Revenue for the second quarter of 2021 grew by 36% year on year and it came in 10% higher than what Amundi booked for the first quarter of 2021. A nearly fivefold increase in performance fees explained half of the increase in revenue, while the 20% increase in management fees accounted for the other half of revenue growth. Even though costs increased by 22% year on year, the healthy revenue growth supported a 5-percentage-point reduction in the cost to income ratio to 46% for the second quarter of 2021, compared with 51% a year earlier. We are likely to increase our fair value estimate of EUR 74 per share by at least 10%, and we maintain our narrow moat rating.