AmazonScience/document-haystack

1Our Performance Indicators2Our Financial Performance3GRI 201-14Overall, we had a solid year of financial performance in 2023. In a “flow-less” market 5recovery, which made it difficult for the asset management industry, we recorded net inflows 6of € 28 billion. Our AuM increased by € 75 billion in the year to € 896 billion. The market 7continued to be challenging for Alternatives, AuM decreased from € 118 billion to € 111 billion, 8mainly driven by negative market impact and FX movements. Our targeted growth area of 9Passive had an exceptional year, and grew its AuM by 24% in 2023, which is far above our 10growth target of >12% (CAGR 2022-2025). Due to market turmoil in 2022, the year 2023 11started with a significantly lower average AuM than in the previous year. Reported revenues 12of € 2,614 million are 4% below prior year, mainly driven by lower management fees. 13Increased investment into our growth and transformation resulted in an adjusted cost-income 14ratio of 64.0%, compared to 60.6% in prior year. Profit before tax is 10% lower than the prior 15year, resulting in lower earnings per share of € 2.76 compared to € 2.97 in 2022.16Alternative Performance Measures17Alternative performance measures182023 202219Assets under management (in € bn. as per period end)  896  821 20Thereof: ESG AuM (in € bn. as per period end)21122133 11723Net flows (in € bn.)  28  (20) 24Management fee margin (in basis points (bps))  27.1  28.1 25Adjusted revenues (in € m.)  2,603  2,683 26Adjusted costs (in € m.)  1,665  1,625 27Cost-income ratio (in %)  70.3  68.1 28Adjusted cost-income ratio (in %)  64.0  60.6 29Adjusted profit before tax (in € m.)  937  1,057 30131 For details on ESG product classification, please refer to section ‘Our Responsibility – Sustainable Action– Our Product 32Suite’.33Alternative performance measures are used to judge the Group’s historical or future 34performance and financial position but are not recognised under generally accepted 35accounting principles. These include assets under management and net flows, which are 36important key performance indicators to evaluate revenue potential and business 37development. To better enable comparison of the revenue and cost development over several 38periods, non-recurring items are excluded from net revenues or total non-interest expenses. 39Our management uses these measures as supplemental information to develop a fuller 40understanding of the development of our business and the ability to generate profit. They 41should only be considered in addition to net income or profit before tax as measures of our 42profitability. Similar alternative performance measures are used by our peers within the asset 43management industry, but these may be calculated differently and may not be comparable to 44the alternative performance measures we use, even if the names suggest that they are 45similar. 46Assets under management means assets (a) we manage on a discretionary or non-47discretionary advisory basis; including where we are the management company and portfolio 48management is outsourced to a third party; and (b) a third party holds or manages and on 49which we provide, on the basis of contract, advice of an ongoing nature including regular or 50periodic assessment, monitoring and/or review. AuM represent both collective investments 51(including mutual funds and exchange-traded funds) and separate client mandates. AuM are 52measured at current market value based on the local regulatory rules for asset managers at 53each reporting date, which might differ from the fair value rules applicable under IFRS. 54Measurable levels are available daily for most retail products but may only update monthly, 55quarterly or even yearly for some products. While AuM do not include our investments 56accounted for under equity method, they do include seed capital and any committed capital 57on which we earn management fees. 58Net flows represent assets acquired or withdrawn by clients within a specified period, except 59when a third party holds or manages the assets on which we provide, on the basis of 60contract, advice of an ongoing nature including regular or periodic assessment, monitoring 61and/or review in which case we include the difference in the value of such assets within the 62specified period which may include currency effects, market performance and other effects. 63Net flows are one of the major drivers of changes in AuM.64Management fee margin is calculated by taking the management fees and other recurring 65revenues for a period, divided by average AuM for the same period. Annual average AuM are 66        67To our Shareholders Summarised 68Management Report69Consolidated 70Financial Statements Compensation Report Corporate Govern-71ance Statement72Supplementary 73Information DWS 2023 Annual Report74 75Our Performance Indicators7612 Our Financial Performance