AXA IM has reported positive third-party net inflows of €3bn over 2018, however total net outflows still amounted to €6bn as the group lost a key mandate and saw negative flows in its Asian joint ventures.
In its full year results for the 12 months to 31 December 2018, the group said net third-party flows were €3bn, largely thanks to success in the alternatives, multi-asset and fixed income space.
However this was "more than offset" by gross outflows of €9bn as net flows amounted to -€6bn.
AXA IM said this was a result of "the loss of a large mandate and outflows from the Asian joint-ventures, mainly as a consequence of large and low-margin alternative products from China joint-ventures reaching maturity, due to local changes of the regulatory requirements in 2018".
Meanwhile, underlying earnings were up by 6% to €270m, driven by lower charges and income tax expenses as well as higher earnings from Asian joint ventures. But revenues were down by 3% to €1.3bn, thanks to lower average management fees as well as outflows "due to adverse market conditions".
AUM was also down, ending the year at €730bn, down €16bn compared to December 2017.
Andrea Rossi, CEO of AXA IM, said: "AXA IM has demonstrated resilience in 2018, delivering robust operating performance with a 6% increase in our underlying earnings despite challenging and volatile market conditions.
"To deliver on our ambitions, we continue to focus and accelerate growth in areas of strength, while further leveraging our AXA experience for the benefit of third-party clients.
"I am convinced that the significant steps we took to transform our company in 2018 will bear fruit, enabling us to better adapt our solutions to our clients' evolving needs."
Most of the success in 2018 for the group was seen in the alternatives space, with a record year for structured finance which saw significant inflows raised from third party institutional investors and family offices in Europe, North America and Asia.
This was driven by the closing of five CLOs representing €2.1bn, and successes in areas such as Dutch mortgages, global secured assets, insurance-linked securities and regulatory capital.
This year, the group hopes to complete its product range within direct lending in Europe to small and mid-sized companies through its strategic partnership with Capzanine.
The real assets space also saw a positive year with the acquisition of Data 4 and other major transactions, bringing the alternatives platform assets above €7bn. In multi-asset, the Optimal Income range was most successful in the retail space, and now represents over €3.5bn.
In fixed income, cashflow driven investing strategies reached €4.4bn from UK based clients, with additional significant wins in the Buy and Maintain range globally. Inflation strategies also recorded major successes, notably with a major mandate in France.