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Introduction & Market Context
Equita Group SpA (BIT:EQUI) presented its fiscal year 2024 financial results on March 25, 2025, revealing a challenging year despite favorable market conditions in several segments. The Italian investment bank and financial services firm reported declining revenues and profits across most business lines while simultaneously pursuing strategic acquisitions to diversify its revenue streams.
Market volumes showed mixed performance across different segments, with Euronext (EPA:ENX) Milan volumes increasing by 11% year-over-year to €422 billion, significantly above the FY’18-FY’23 average of €361 billion. Fixed Income (MOT) volumes also rose 9% to €316 billion, while Euronext Growth Milan volumes declined 12% to €3.6 billion. Capital markets and M&A activities demonstrated strong growth, with Debt Capital Markets up 44% and Mergers & Acquisitions surging 91% compared to the previous year.
As shown in the following chart of market volumes across various segments:
Quarterly Performance Highlights
Equita reported FY’24 net revenues of €79.4 million, representing a 9% decrease from €87.5 million in FY’23. Fourth-quarter performance showed an even steeper decline, with net revenues falling 15% to €23.8 million compared to €28.1 million in 4Q’23. Net profits for the full year decreased 13% to €14.0 million, while fourth-quarter profits dropped significantly by 34% to €4.2 million.
Despite the revenue and profit declines, the company maintained its dividend per share at €0.35, unchanged from the previous year. Return on Tangible Equity (ROTE) decreased to 22% from 26% in FY’23, while the IFR Ratio remained relatively stable at 3.7x compared to 3.6x in the prior year.
The following consolidated highlights provide a comprehensive overview of Equita’s financial performance:
Detailed Financial Analysis
Equita’s revenue mix shifted slightly in FY’24, with Global Markets increasing its contribution to 51% of total revenues (up from 47% in FY’23), while Investment Banking decreased to 38% (from 41%) and Alternative Asset Management remained relatively stable at 11% (down from 12%).
Global Markets revenue remained relatively stable at €40.6 million compared to €40.9 million in FY’23, supported by mid-single-digit growth in Sales & Trading and profitable Directional Trading activities. Investment Banking revenue declined significantly by 17% to €30.1 million, despite positive contributions from M&A activities and growth in corporate broking mandates. Alternative Asset Management revenue fell 16% to €7.0 million, though management fees showed 2% year-over-year growth, reaching 15% when including performance fees.
The following chart illustrates the trend in net revenues across business segments since the company’s IPO:
Equita demonstrated disciplined cost management, with total costs decreasing by 7% to €59.3 million. Personnel costs, which represent the largest expense category, declined 8% to €38.5 million, while operating expenses decreased 3% to €20.7 million. Despite these cost reductions, the cost-to-income ratio deteriorated to 74.6% from 71.5% in FY’23, reflecting the impact of declining revenues.
The detailed breakdown of costs and profitability metrics is shown in the following table:
Strategic Initiatives
Amid challenging financial performance, Equita has pursued several strategic initiatives to diversify its revenue streams and strengthen its market position. The company acquired the remaining 30% minority stake in EQUITA K Finance, consolidating its ownership and strengthening its partnership with Clairfield International.
Additionally, Equita announced an agreement to acquire a 70% stake in CAP ADVISORY, a boutique firm specializing in debt advisory, corporate finance, and restructuring services. This acquisition, valued at a price-to-earnings multiple of 9x, is expected to contribute €3 million in net revenues.
In the Alternative Asset Management segment, the company launched the EQUITA Green Impact Fund (EGIF) and secured its first investment agreement with DOMINION to build 74MW capacity. Equita also announced the first closing of its third private debt fund (EPD III), which is expected to add approximately €450 million in new assets under management by the end of 2025.
The following overview highlights these strategic developments:
Forward-Looking Statements
Equita has implemented significant governance changes, including a new shareholders’ pact with 38 signatories and the appointment of two new Co-General Managers. The management team remains strongly committed to the company, with an average age of 53 years and over 13 years of seniority at Equita.
The company’s governance structure and ownership are illustrated in the following chart:
Looking ahead, early 2025 market indicators show promising trends, with Euronext Milan volumes up 22% year-over-year through February 2025, suggesting potential for improved performance in the coming quarters. However, Euronext Growth Milan volumes continued to decline, down 39% in the same period.
Equita’s strategic acquisitions and fund launches position the company to diversify its revenue streams and potentially offset the challenges faced in its core business segments. The company’s continued focus on cost discipline will be crucial in improving profitability metrics in future periods.
Full presentation:
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