Good afternoon, everyone, and thank you for joining us today for Azimut First Quarter 2025 Results presentation. I'm Giorgio Medda, CEO of the group, and I'm pleased to be here with Alessandro Zambotti, our Group CFO, and Alex Soppera, Head of Investor Relations. We had a very strong start to the year, and today we will walk you through our key developments, financial performance, and the strategic progress we have made in positioning Azimut for long-term growth and value creation. Let's get it started and move to slide three, please. Let me begin, first of all, with the key highlights from the first quarter of 2025, which marked a strong start to the year from a strategic, financial, and operational perspective.
We recorded the best first four months in our history in terms of managed net inflows, raising EUR 5.5 billion out of EUR 5.7 billion in total, almost three times higher than the same period last year. This performance underlined the strength of our diversified business model and global platform. Secondly, recurring net income increased by 13%, confirming the resilience and the quality of our core business, even as overall profitability was affected by lower variable fees compared to last year. From a strategic standpoint, we have strengthened our senior leadership team through the appointment of a renewed Board of Directors, reinforcing our governance as we prepare for the next chapter of growth, which I will expand on shortly. As many of you will have seen in the news recently, it has been a particularly busy period for us.
We made two strategic acquisitions in the U.S., entered the Moroccan market, and just a couple of days ago announced that we are preparing to launch operations in our 20th country, the Kingdom of Saudi Arabia. Lastly, we made progress on the TNB transaction, which remains a strategic priority for the group, and this will be discussed in more detail later by Alessandro. I'm also proud and pleased to share that in the first quarter, we surpassed one million clients globally, another important milestone in Azimut's journey as a leading multi-generational financial advisory platform. Turning to the numbers in more detail on page four, our diversified business model continues to deliver solid results. Total assets have reached EUR 107 billion at the end of April, with EUR 73.3 billion in managed assets, up 4.4% since the beginning of the year, supported by strong net inflows and positive asset dynamics across all geographies.
It's worth noting, though, that at the group level, we have faced some FX headwinds, in particular from the U.S. dollar, as well as certain emerging market currencies that have softened our total asset growth. Revenues in the first quarter came in at EUR 321 million, driven by an 8% increase in recurring fees across all core markets, with particular strong contribution from Italy, Turkey, Brazil, Singapore, and the U.S.. On the profitability side, our EBIT stood at EUR 141 million, and if you look at the recurring component, excluding performance fees, we posted a 6% increase driven by higher volumes and discipline in cost management. Net profit reached EUR 115 million, and on a recurring basis, we recorded a 13% increase versus the same period last year. This is a clear indication of our view of the strength of our core earnings.
Finally, we continue to generate robust cash flow, with a cash flow-to-market cap ratio in excess of 13%, and it is an annualized yield. This underscores our capacity to fund both growth and shareholder returns, still maintaining the possibility and the capability to entertain investments into future opportunities. Yet, we believe that the strength is not fully reflected in our current market valuation, offering, in our view, a clear disconnect and an opportunity for long-term investors. Turning now to governance on page five, I'm pleased to present the composition of our new board of directors for the 2025 and 2027 term. This renewal reflects both continuity and evolution, providing a strengthened foundation to guide Azimut through its next chapter of growth. I would like also to briefly introduce myself, as well as my colleague Alessandro Zambotti. I joined Azimut in 2007, following over a decade in sell-side roles.
Within the group, I've served as a portfolio manager and later led business development initiatives for our international operations, starting in Turkey and Dubai. I've also led our global asset management business from Luxembourg, and three years ago, I moved to New York, U.S., to support our global strategic expansion around the world. As for the board structure, we have confirmed the composition that reflects a balance of experience and independence in line with the best practices. Five independent directors, 50% female representation, and two representatives from our new Italian commercial organization, highlighting once again the central role of our distribution network. Alongside Alessandro and myself, both reconfirmed as board members, and under the continued leadership of our founder, Pietro Giuliani as chairman, we are committed to driving Azimut forward with discipline, innovation, and a long-term strategic vision.
Let me tell you that we are thankful for the trust of our shareholders and very excited for what lies ahead for us. Let me now walk you through an important evolution in the way we represent Azimut business, starting on slide six. This new structure is not just about simplifying representation. It reflects a fundamental shift in how we operate and communicate. Together with Alessandro, we commit to disclose our financials and business proposition in a clearer way going forward. Azimut is a global, multi-generational financial advisory platform that we will continue to scale across geographies, asset classes, and digital channels. Our asset management as a service proposition puts investment performance for the benefit of our clients and product solutions across public and private markets at the center, enabled by technology and our global distribution networks.
This new structure helps address market complexity, improves transparency, and allows us to better highlight the strength of our long-term fundamentals. We believe our model is particularly well-positioned to respond to the structural industry shifts, thanks to our scale, geographic diversification, and alignment between performance and distribution. With this new presentation format, we aim to reposition investor perception and demonstrate that Azimut is not a collection of silos that is reliant on a single market, but a single high-performing platform with multiple levels of growth. Let's turn now to page seven. How does this all translate in practice? What you see here is the blueprint of how we intend to represent the group going forward, an organizational matrix that mirrors how we actually run the business.
On this slide, we present the total assets as of the end of April, structured by product lines across the top, from investment funds to digital asset management, and by key distribution channels along the left. This is more than a new reporting layout. It is a transparent and aligned view of how our platform creates value, and over the coming quarters, we will also reflect the structure in our financial disclosure, giving investors greater clarity on growth, scale, and profitability across our core pillars. Moving on to slide eight, this slide gives you the geographic breakdown of our total assets as of April 2025. What is new is that alongside our traditional regional reporting, we are now showing separately the perimeter of our strategic affiliates, namely Sanctuary in the U.S. and AZ NGA in Australia.
These are businesses where we are no longer exercising direct control, but where we remain a strategic shoulder. By separating them, we reflect their distinct business models and highlight the long-term value potential. As you have seen, by the way, with the recent partial sale of AZ NGA, these platforms offer a very meaningful room to scale and create upside over time together with our local partners. Turning to page nine, let me walk you through an important change in how we will report our assets and inflows going forward. We have introduced a simplified structure that better reflects how we actually run the business: cleaner, more intuitive, and free of double counting, giving investors a clear view of where growth is being generated. Going forward, our reporting will focus on five product categories: mutual funds, alternative funds, discretionary and advisory, life and pension, and strategic affiliates.
As mentioned on the previous slide, we have carved out our strategic affiliates, Sanctuary and AZ NGA, to reflect the distinct business dynamics and fundamentals. At the same time, assets previously reported under custody and advised are now consolidated into the discretionary and advisory line. Lastly, pension funds assets, previously included in funds, will now be reported under life and pension to ensure a clear attribution, also consistent with our financial planning product offering. Let me be clear and repeat this once again. This is more than a technical update. It is part of a broader push to enhance transparency and ensure our disclosures are fully aligned with how we manage capital, allocate risks across our business platform, and deliver long-term value. Let's now move to page ten to dive quickly into the year-to-date performance in terms of assets and inflows.
On this page, you will see how our total assets have evolved since the start of the year under the new reporting method. I will not go too much into the detail here, as we have already published and commented on these figures in our press releases, but I want just to highlight the strong demand for mutual fund solutions since the start of the year, supported by our networks and partners in Italy and Turkey. We recorded EUR 5.7 billion of net inflows in the first four months, of which EUR 3.4 billion were organic. This is the best performance in the group's history for this period. This underscores the strength and appeal of our offering across both mature and growth markets. On the asset side, also, I would like to mention that we closed April just shy of EUR 107 billion.
This certainly represents a marginal decline since year-end, but is entirely and mostly due, in fact, to effects headwinds, particularly due to the U.S. dollar and some emerging market currency developments. These results, in our view, confirm the resilience of our core business and the effectiveness of our diversified model, delivering growth across channels, geographies, and client segments. Turning now on to page 11, here, we introduce a new visual representation of what is driving our profitability in a more intuitive and transparent way. While Alessandro will go into the details shortly, I'd like to highlight a few points. First, our recurring operating business, after all costs, grew by a solid 6%, a strong signal of the health of our platform.
Secondly, we received a solid contribution from our strategic participations, including dividends from our GP Stakes business that I will also elaborate more into details shortly with the transaction that we have announced just yesterday with IPOS Capital. Finally, while the headline net profit shows a modest year-on-year decline, this is entirely due to lower performance fees. When we look at recurring net profits, so after stripping out the variable components and all the non-recurring items, we actually saw an increase of 13% to EUR 112 million. Let's move now on to slide 12. This slide, along with the next one, marks another important evolution in how we present the business. What you see here is the current P&L breakdown by business verticals, a structure that we introduced with our full-year results in 2022.
While this representation helps illustrate the underlying dynamics of our platform at that time, we continue to scale across geographies and solutions. We have, though, now recognized the need for a clearer, more actionable format, one that speaks to both our internal performance drivers and external investor expectations. Therefore, starting from this quarter, we are transitioning to a new framework, simpler in structure, yet more granular. I will show you this updated view on the next slide. On slide 13, you see a simplified overview of our Q1 2025 performance versus the same period last year, applying our new reporting structure. As mentioned earlier, we now present a more detailed geographic breakdown of the international business while also separating out our strategic affiliate perimeter. Let me briefly highlight a couple of takeaways without going into the numbers.
In Italy, we saw a 15% increase in total assets, which translated into higher recurring revenues. However, the bottom line was affected by lower performance fees compared to a very strong Q1 in 2024. Internationally, we have achieved a meaningful uplift in profitability thanks to asset growth, strong recurring revenues, and the contribution from dividends received on our GP stakes. The results underscore the strength and the scalability of our diversified business model. Let me now turn to the next slide, where I will highlight the product pipeline that is expected to support further growth in the coming quarters. On slide 14, you see how we are scaling innovation across asset classes, geographies, and digital channels. On the public side, we are launching seven new use strategies, rolling out a refreshed suite of private insurance solutions under the name of Azimut Life Collection.
We are accelerating onboarding with all sale distributors across key hubs like Dubai, Hong Kong, and Singapore. Notably, we are also launching the China UAE ETF link with China Universal Asset Management, one of the largest independent managers in China. It is a very bold move that reinforces our capability to leverage cross-border partnerships. On the alternative side, we continue to deepen our capabilities with new vintages for our flagship private equity infrastructure portfolios and strategies, the debut of our Capital Solution Suite, the launch of a corporate venture capital initiative, and the revamped offering in Turkey and Brazil, where we are already managing over EUR 550 million in niche private market strategies. This pipeline reflects the breadth of our platform and certainly our ability to innovate and deliver value across all client segments along the market cycle.
On the following slide, we also showcase the different initiatives that we have undertaken across digital business developments. Last month, we launched in Italy Meta Advisor, a new tool allowing clients to engage with the GenTech AI and have a relationship with their financial advisors for everything being related to their portfolio. Last month, we also launched Azimut Next Generation Advisory, an AI-driven portfolio construction that will constitute a very significant part of our offering in the coming months. In February, we launched Azify, a digital wallet in Brazil that also includes a stablecoin offering. We have also continued since the beginning of the year to expand the product offering of AZInvest, a digital fund distribution platform in Egypt that now captures almost 20% of all the new clients in the country.
Also, following the end of the summer, we will be expanding the offering of BYs in Belgium and Luxembourg after the success that we had in Italy. Let me now move on to our international expansion on slide 16. I'd like to start with Morocco, the transaction that at the end of March saw us acquiring 25% in Red Med Capital, one of the largest independent managers in the country, EUR 1.7 billion of assets under management, a 3% market share. Let me remind you that Morocco today is one of the most developed asset management industries across all emerging markets, with a 33% growth annually over the last 30 years. Morocco is also the African country with the highest millionaire growth rate over the last 10 years.
This is a strategic investment, a plug-and-play for the group, considered that Morocco and Europe, they have a very well-established relationship. This transaction will allow Azimut to expand its distribution capabilities into Morocco, leveraging its European product factories. Two days ago, also, we have announced the obtainment of the principal approval to operate as a fully-fledged onshore asset management company in Saudi Arabia. Operations will start in Q3 2025, unlocking significant new growth opportunities in the kingdom. Let me tell you, Azimut has been already operating in the country since 2020 with the management of institutional mandates today in excess of $400 million. We are looking really to expand to benefit from the very sizable retail opportunity with the local asset management industry in excess of $260 billion, expected to grow by 50% over the next 50 years.
Obviously, needless to say, the possibility of operating from within the country to address and penetrate the very significant pool of institutional assets. Also, yesterday, we have announced a very exciting strategic development in the U.S.. On slide 17, we highlight the details of our increased investments in IPOS Capital. As announced, we raised our stakes from 15% to 56%, taking a controlled interest in a business that we know well and we have seen growing sixfold in AUM since our initial entry. We are close to EUR 650 million in AUM and a strong track record in private equity and venture capital. IPOS is not only a growth story, but a very powerful platform for us to further scale our presence in the U.S. alternative space. This transaction also deepens the alignment between our two firms.
More importantly, it marks a very important step in our partnership with David Moreau and Mark Bezos, who will both increase their ownership in Azimut, further reinforcing our partnership. David, in addition to his role as IPOS CEO, will also serve as a senior advisor to ACP, supporting our broader GP stakes business. Meanwhile, Mark will become Head of Strategic Partnerships and a board member of Azimut U.S. Holdings. Looking ahead, IPOS is planning to launch two new funds by year-end, further expanding its product offering and opening new opportunities for value creation across our ecosystem. This concludes my part for now. I now hand over to Alessandro, who will give you some insights into the progress of the new bank transaction. Thank you.
Thank you, Giorgio. Good afternoon to everyone. From my side, let's move to slide 18. Here, we just simply reproposed the same slide that we already proposed in the last call, in the last two calls. The aim is just to underline again that the purpose of this transaction is not driven by a specific element or driven by a specific condition, but we have three options on the table, and we are still running the project in this way. Therefore, the aim is still focused on one real objective, that is to create more value for clients, shareholders, financial advisors, and employees, and also capitalizing on assets that are currently outside the Azimut perimeter. This is important to help me also on the following slide, where we just give you an update on the exclusivity agreement that we still have with FSI.
As you probably remember, there was a deadline within the end of April. This exclusivity has been extended to the 20th of May. From one side, the part of the due diligence is completed, but from the other side, we are still negotiating and finalizing the transaction. Therefore, at the moment, for the information that we can share, following also the sensibility of the information, we're just able to give you a better view, but just related to the fact that we extended the exclusivity period. The other information is still the same. Therefore, we expect to obtain the banking license within the end of the year, and the aim of the project is what I mentioned before. Moving to numbers, moving to slide 20, here we just try to give you the big picture of the consolidated results of the group for the first quarter 2025.
We will go in detail. Therefore, I will not spend additional time through the single line of the numbers here, but I just want to give you an update on the fact that in relation to the first quarter 2024, we created a new column that is following the adjustment related to the consolidation of Zynga. That means that to have a better analysis or a better comparison of the numbers, we take out the line-by-line contribution of Zynga through the first quarter 2024. Also, here you will see at the end the recurring net profit that we introduced, which has been introduced by Giorgio at the beginning, is a new way to look to the numbers of the group of focusing on the recurring business.
In the other way, taking out the effect of the variable fees or non-recurring effects like fair value option, non-operating cost, and as we always do, also taking out the effect of the IFRS 17. In this way, probably, and I think we expect that in the future, you will have a better understanding of the evolution of the recurring business. Moving again to more details, here you have the slide related to the revenues. Total revenues, I mean, comparing the two quarters, the first quarter 2025 with the first quarter 2024, overall, you have a decrease of EUR 2 million. If you consider, let's say, the single variation, you can see that there is a solid growth in recurring fees, plus 8%, that in absolute value, EUR 20 million more. This is thanks to the Italian, let's say, perimeter.
Across all the business lines, we benefit from a positive increase in terms of mutual fund recurring fees, plus EUR 6 million, and alternative funds, plus EUR 4 million, plus additional positive effect from the portfolio management or the advisory fee. Also, we have a positive contribution thanks to our international business led by Turkey, Brazil, Singapore, U.S., that provide and contribute to the growth of the recurring fees by EUR 8 million. In terms of performance fees, you can see that the full-term were negative, EUR 1.4 million in the first quarter 2025 compared to the EUR 1 million positive of the first quarter 2024.
Also, if we look to the insurance revenue, it's true that we see a decrease of EUR 80 million, but last quarter, so the first quarter 2024, was benefiting by EUR 28 million of performance fees that is not contributing at the same level this year, this quarter, because it's just EUR 5 million. Therefore, the real positive message here is again that despite the volatility of the market that we are facing, we are increasing our recurring revenue by 17%, that is almost EUR 4 million compared to the first quarter 2024. Just to conclude, the other revenue, we are almost stable thanks to the contribution from our corporate investment banking business. Moving to the next slide, we have details in relation to the cost. You can see an increase of EUR 6 million overall.
We have EUR 9 million more in terms of distribution cost due to an increase of the recurring revenue, again, as I mentioned before, in Italy and abroad, of almost EUR 3 million and a Tiger provision for variable incentive to Italian FA of almost EUR 4 million. On personnel and Zynga, we have an increase of EUR 6 million, again, linked to the evolution, as you remember, as you always say, the international business is also impacting this line of the P&L. Therefore, linked to the evolution of the business, we have an increase of EUR 4 million around this line. We are flat on the amortization. Moving to the next slide, here we have the EBIT and the net profit. You see again a positive variation of 6% of the EBIT and 13% on the recurring net profit.
This is also thanks to the fact that at the level of the finance income, we have a positive contribution of almost EUR 14.5 million, and it's mainly explained by EUR 4 million dividends from GP Stakes and affiliates, EUR 3 million realized and unrealized gain and losses on our own investment, EUR 3 million net interest earn, EUR 3 million fair value option, main also EUR 1.5 million related to the IFRS 17. Again, I would like to underline once again the important result and the important increase of the recurring net profit by 13% year on year. Following slide, net financial position. We have a positive and almost EUR 1 billion of net financial position. As you can see, we have an increase compared to December 2024 of EUR 232 million.
As we always do, we try to reconcile the variation starting from the net profit before tax, so EUR 145 million, plus the EUR 68 million that is cash that we received during the first quarter 2025 related to the transaction of Zynga, so linked to the receipt that we have seen during the quarter. We proceed, I mean, we continue our investment activity. Therefore, we have less than EUR 80 million through M&A and then a positive reimbursement of stamp duties by EUR 40 million. Therefore, these three amounts should reconcile the variation that I mentioned. Okay. I mean, I'm going to give back to Giorgio for the conclusion.
Yes. Thank you, Alessandro. We said we had a solid start into the year that obviously makes us very comfortable in reconfirming our targets for the full year. We had a net profit target between EUR 400 million and EUR 1.25 billion, depending on the completion of the TNB transaction. Obviously, we have achieved EUR 150 million as for Q1 2025, and that is approximately 30% of the overall target if measured at the bottom of our guidance. In terms of net inflows, EUR 10 billion was the target. As we said, we had the strongest start in the history of the group, 5.7 billion achieved as of the end of April 2025, and that makes a 57% achievement on the overall target.
Let me tell you that the group will present its new strategic targets and dividend policy by Q3 2025 results, and this is to mark the next phase of value creation for our group. Now, let me open the floor to questions. Thank you.
This is the CALSCOLL conference operator. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on the touchstone telephone. To remove yourself from the question queue, please press star and two. Please pick up the receiver when asking questions. Anyone who has a question may press star and one at this time. The first question is from Hubert Lam from Bank of America. Please go ahead, sir.
Hi. Good afternoon. Thanks for taking my questions. I've got three. Firstly, on the new bank, thank you for the update. I'm just wondering if you can maybe talk a little bit more in terms of operationally how things are progressing, just in terms of maybe deposit growth, customer interest, advisor hires, etc., and any changes in your expectations around the development. Second question is on your high-post stake now. You have now a majority stake. Just want to double-check, is this more a financial investment in the high-post, or do you see opportunities for possible cross-sell opportunities of the products into your client base? Lastly, a question on Nova. You continue to highlight it as a contributor to your inflows. Can you talk about how significant it's been to your inflows and maybe how the operating margin is doing compared to your target around it previously? Thank you.
Okay. In relation to the TNB transaction, as I mentioned before, in general, the transaction is still going on. That means that we are positive in terms of the evolution. This is the reason why we decided to extend the exclusivity. At the end of the day, we are not still able to anticipate any element, but we see the possibility to conclude positively. As I mentioned during the call, the message is that we are not now close to only this option, we still have other possibilities for us to generate value for the group, but also generate value for our stakeholders. That means that we are still working to create the value that we are going to transfer through the spin-off. The activity through the deposit, obviously, is still going on.
This is an activity that we already start, but with a normal evolution of the activity itself. Probably I'm going to take also related to Nova. I mean, Nova, again, is producing a positive effect and positive impact on our P&L. We are close to the net profit margin that we were expecting because obviously, we were missing at the beginning the economic scale coming from the cost of the structure. Thanks to the evolution of the AUM, we are covering this part positively. Therefore, we are close to the 40-45 basis points of net that we announced at the beginning when we announced the partnership.
Yes. On IPOS Capital, let me say that this is an industrial investment, a strategic investment. The idea is certainly to leverage our majority stake to use IPOS Capital to launch new funds, new strategies. Obviously, what we can do with David and Mark is to tap onto an incredible network relationship, a great origination pipeline, a very solid LP base, and that obviously poses very well for the future of IPOS, but as well as for Azimut penetrating distribution opportunities across the country.
Great. Thank you.
The next question is from Alberto Villa from Intermonte SIM. Please go ahead, sir.
Thanks for taking my questions and congratulations for the appointment. I have a few questions, mostly around the new organization. I'm sure it's going to simplify the understanding of the operating performance of the company, so of the group, and this is certainly positive. I was wondering if it's possible eventually to have a deck with also 2024 numbers under the new organization and the quarters for the past year so we can try to start to model our own estimates based on this new organization. Going to the reorganization, just to make clear a few points that I'm not sure I got completely. If we go to slide seven, to your new matrix, I was wondering if you can help me understanding what does integrated solutions and global wealth mean in practical terms?
My simple question is, if we look at your, let's say, traditional Italian financial advisor distribution business, how is that fitting into this new matrix? What is within integrated solution? What is within global wealth that could be helpful for me to understand how it works? Then again, on slide 12, you give us a few details about the single regions. It actually took my attention, the fact that international business has got an increase in AUM of around 30% and a decrease of revenues of mostly 30%, then EBIT is up. There has been some moving parts for sure, but I wanted to check with you what was the reason beneath these different behaviors of AUM trends and revenues and margins. Finally, if I may, just another question to better understand how you calculated the recurring income you are now communicating.
The various items, part of the financial income, are that considered stripped out what is in the recurring and what is not? Thank you very much.
Okay. Alberto, let me pick your first question on the reorganization and the figures that we have shown in slide seven. Indeed, Italy is part of the integrated solution distribution cohorts. With integrated solutions, we identify businesses where we have a clear competitive advantage built upon the integration of private factories with distribution teams. Obviously, Italy represents the benchmark for this business proposition, but the figures that you see shown here also include countries such as Mexico, Turkey, and Taiwan. These are countries where we operate exactly on the same basis and also for similarities that are pretty obvious in the way we approach and cater to clients. Global wealth, on the other hand, represents the global wealth management business that we conduct out of what are global marketplaces for wealth management, offshore wealth management, such as Singapore, Hong Kong, Dubai, Switzerland, Monte Carlo, and Miami.
Obviously, you see these integrated solutions and global wealth distribution cohorts. What is important for me to stress here is that both distribution efforts rely upon the ability of Azimut to deliver investment management solutions in different forms and private cohorts, that being investment funds, discretionary advisory mandates, or life or welfare solutions.
Back to, I mean, taking the other point, if I'm not wrong, first of all, looking to slide 12, you mentioned the fact that you were seeing EUR 66 million in revenues compared to the EUR 48 million of the first quarter 2025. Here, as we didn't mention already, the fact that we created the first quarter 2024 adjusted, we just keep the same level of revenues, so also considering the full contribution of Zynga in the first quarter 2024. That's what we did after in the presentation. We took out and we made the comparison more friendly and comparable itself. That means that the contribution is related in terms of revenue by Zynga in first quarter 2024 that is missing in 2025.
As you can see, through the evolution of the positive total asset, you have a positive net profit impact, and also at the level of the EBIT, we have a positive increase. That means also.
Sorry, I'm not sure I understood. In the first quarter 2025, in the international segment, there is not obviously Australia, no?
It has been deconsolidated. It provides a positive contribution in terms of revenue in the first quarter 2024.
Okay. The trend in assets that grew from EUR 41 billion to EUR 53 billion, what is the driver beneath that, if I may?
I mean, it's linked to the evolution of the business. That means Sanctuary, for example. We are still representing the real value of total assets coming from the international business. I was trying to say, it's also linked to the fact that if you consider the impact of the Australian business in the first quarter 2024 in terms of net profit, you can see in the slide of the P&L, I mean, the 2020, that there was no significant contribution in terms of net profit. In the other way around, you see that the positive increase in terms of AUM provides a positive increase in EBIT and net profit in the first quarter 2025.
Okay. Okay. Thank you.
If I'm not wrong, you mentioned also the calculation. I mean, the way we fix the amount related to the recurring net profit, that is EUR 112 million. We do the result of the group. We take out the effect of the performance fee coming from the insurance, so EUR 5.3 million. We take out the effect of the full term, so EUR 1.4 million, in this case, negative. And as well, the contribution of the option, fair value option, so EUR 2.6 million. In the opposite way, the IFRS 17, that was impacting EUR 1.6 million, more or less. Those are the four elements that we are considering.
Okay. So all the other elements in financial income are included in their current net income.
Of course. Thank you.
Grazie.
The next question is from Elena Perini from Intesa Sanpaolo. Please go ahead.
Yes. Yes. Good afternoon, and thank you for taking my questions. First question is about an update on the new bank in terms of assets and financial advisors. You started, you had the spin-off one year ago with approximately EUR 24 billion of assets and 1,000 financial advisors. I was wondering where you are at the moment in terms of both those items, if you have started recruiting and how it is going? My second question is about private markets. I see that in your new breakdown by vertical, you did not mention anymore the private markets. I was wondering whether this is no more a strategic driver for you or if there is any other reason behind this? Thank you.
Elena, thank you very much. I'll actually start picking up your second question. Let me say private markets remain a strategic priority for our private development. We are strong believers that diversification across illiquid alternative investments is of paramount importance for our ability to generate performance for clients. We do actually see this as positive and necessary for value and performance for our clients' portfolios. Obviously, we have shown today a breakdown of earnings using a geographic breakdown. We have heard in the past that that was something that was missing, particularly for those trying to analyze how we created value out of a very material investment base over the years. We said that over the coming quarters, we will be able to provide a breakdown, also following the matrix in slide seven.
Within that breakdown, by private line or distribution cohorts, we will break down also the contribution of private markets. For your reference today, when you look at slide 12, you see what has been the contribution of private markets within that table where we wanted, for transparency, to outline the reporting of earnings according to the breakdown method that was used up until the end of last year.
In relation to your question of the TNB, in terms of FAI, let's say that we are broadly stable. On one way, someone left, but on the other way, the activity of the recruiting gave us, let's say, the effect of people that is, I mean, FAI that are joining the project. For sure, in the future, someone is coming. Therefore, all in all, we are almost stable. In terms of assets, excluding the market effect, which I have in mind, it's a number close to EUR 25.5 billion-EUR 26 billion. We are growing compared to the, I mean, the level of the AUM where we start, obviously, again, underlying the market effect that obviously is impacting during those days.
Okay. Thank you very much.
The next question is from Ian White from Autonomous Research. Please go ahead.
Hi, there. Thanks for taking my questions. Two from my side, please. Firstly, just coming back to the new bank transaction, can you just clarify for us, what are the main talking points there that remain with respect to the terms? You said the due diligence is done. So financial terms seem to be within a definable range. What's still left to be agreed there, please? What's the sticking point, if you like? Secondly, any comment, please, on the outlook for exits within the private market business? Heard some more downbeat comments maybe from some of the sort of private market specialist names, but has anything really changed there for your business with respect to the increased market uncertainty we've had in the last month or so? Thank you.
Yeah. Yeah. Actually, I'll start with your second question. Yeah. Obviously, we see what's happening in the market. Indeed, the slowdown in exits is very obvious. Although, I have to say that we are still operating with funds with relatively recent vintages. We are not really today focusing on exits, although on a very opportunistic basis, we have been able to exit in a few instances. An example I would like to bring to your attention is the recent exit from an Italian leader in the tiles industry, tiles manufacturing. That was the first investment of our Demos One fund launched in 2020. Well within the investment period, we were able to exit this investment with a 3X multiple. That has been done in a difficult market. It has been done, obviously, with all the headwinds that we know very well.
I think on an opportunistic basis, we will consider where and when we are able to maximize our investors' value. In general, we are not really that concerned for what the market will be in the future. We see all this as very cyclical.
In relation to the first question, I mean, I'm going to answer in a simple way because at this stage, after the conclusion, in the completion of the due diligence, we are obviously now working on the contract. As you probably expect in terms of answer, you never know what is going to happen, even if you fix the main elements or the main KPI that would respect to two of them. Therefore, we are working on it. Again, waiting to finalize everything. We cannot anticipate any further information.
Got it. Thanks very much.
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