Results of operations
MLP has begun the year with stable revenue development. Following the increase in the subsidized premiums for the Riester pension scheme (“Riester step”) during the comparative period last year, which accounted for around a quarter of the total revenues, total revenues in the first quarter 2009 only fell by 19% to € 125.5 million (€ 155.9 million). Exceptional and one-off costs amounting to around € 3.3 million were incurred for legal and capital market-relevant consulting services as a consequence of Swiss Life’s stake in MLP and associated effects. After adjustment for this special factor, earnings before interest and taxes (EBIT) stood at € 6.8 million (€ 25.1 million).
Total revenues (in € million)
In view of the far-reaching financial and economic crisis our clients have a great need for consulting services, however the hesitancy and restraint with respect to the conclusion of long-term contracts continued during the first quarter. MLP stood up to a very difficult market environment and has performed well under these circumstances.
As scheduled, the annual dividend distribution to the minority shareholders of the subsidiary Feri Finance AG reduced the financial result in the first quarter by € 2.4 million. This resulted in net profit from continuing operations of € 0.3 million (€ 8.7 million). MLP further increased its financial strength with liquid funds rising to € 216.4 million (31.12.2008: € 210.1 million). Particularly under the current conditions we benefiting from our financial strength. Our excellent capital base provides us with extensive scope, also with respect to the expected upcoming consolidation within the industry.
Earnings before interest and taxes (EBIT, in € million)
Successful development in health insurance
Following the German government’s introduction of the central healthcare fund, MLP targeted private healthcare insurance as one of its areas of sales focus in the first quarter. Compared to the previous year, revenues in this area rose by 20 % to € 13.7 million (€ 11.4 million). Similar to the second half-year of 2008, the areas of MLP closely connected to the capital markets were again significantly influenced by the financial crisis. In many instances clients opted for short-term forms of saving rather than long-term wealth investments. Against this background, revenues from wealth management declined by 16 % from € 20.5 million to € 17.2 million. At € 62.9 million, old age pension provision also remained below the previous year’s level (€ 87.5 million). Following the Riester Step in the comparative quarter of last year we expect 2009 to exhibit the customary concentration of revenues in old-age pension provision towards the end of the year. Revenues from commissions and fees across all consulting areas totalled € 111.6 million (€ 138.7 million). Interest income also fell slightly, declining to € 9.2 million (€ 10.0 million) in the first quarter due to the lower level of interest rates.
Assets under Management stable contrary to the market trend
The pleasing progress achieved in health insurance was also evident in the level of new business. In view of the significant advantages, many state-scheme insurees opted to switch to private healthcare insurance – leading to an increase in annual premiums from € 11.8 to € 13.3 million. New business in old-age pension provision amounted to a premium sum of € 0.9 billion (EUR 1.9 billion) and was thus around the level achieved in 2007; the still relatively new business area of occupational pensions contributed a significantly larger proportion towards this figure, amounting to 11 % (full year 2008: 8 %). The development in assets under management remained stable, totalling € 11.2 billion (31.12.2008: € 11.4 billion) – despite the fact that all the major share indices again suffered significant losses in the first quarter.
During the period from January to March, MLP gained a total of 6,600 new clients. Including the acquired financial broker ZSH, the total number of clients increased to 773,000. The number of consultants rose to 2,435 (31.12.2008: 2,413).
Development of expenses
The commission expenses fell significantly due to the decline in revenues from commissions and fees, amounting to € 41.5 million (€ 55.7 million) in the first quarter of 2009. Our interest result during the period under review stood at € 4.6 million, thus almost equalling the level achieved in the first quarter of 2008 (€ 4.8 million). Interest income fell from € 10.0 million to € 9.2 million due to the lower interest rate level. The interest expenses fell by 11.5% to € 4.6 million.
Personnel expenses during the period under review rose by € 2.7 million to € 28.9 million and were acquisition-related as well as being attributable to general salary increases and a build up in personnel. Write-downs fell, as anticipated, from € 5.0 million to € 4.4 million.
Other operating expenses rose from € 38.7 million to € 42.7 million. This figure contains one-off expenses amounting to € 3.3 million that were incurred with respect to the MLP stake held by Swiss Life and the associated effects, in particular for legal and capital market-relevant consulting services. Higher IT costs also contributed to the increase.
We significantly improved our financial result in the first quarter. Following € –8.1 million in the first quarter of 2008, the financial result in the first quarter of the current financial year came in at € –1.5 million. This improvement was mainly attributable to a dividend payment to the minority shareholders of Feri Finance AG that was lower than in the previous year. In the first quarter of 2009 this only amounted to € 2.4 million (€ 7.8 million).
Taxes on earnings in the period under review amounted to € 1.7 million (€8.3 million). In this respect it should be noted that the dividend payment to the minority shareholders of Feri Finance AG is not valued as a tax-recognised expense.
Net profit from discontinued operations improved slightly from € –1.9 million to € –1.4 million. In these figures we primarily show our business activities in Austria and in Netherlands for which we are seeking a new ownership structure.
Overall we thus had to report a Group loss amounting to € 1.2 million (in the previous year a Group profit of € 6.7 million). The basic and diluted earnings per share amounted to € –0.01 (€ 0.07).
Earnings development of the continuing operations
|All figures in € million||1st Quarter 2009||1st Quarter 2008||Change|
|Total revenues||125.5||155.9||–19.5 %|
|EBIT margin||2.7 %||16.1 %||–|
|Finance cost||–1.5||–8.1||81.5 %|
|EBT margin||1.6 %||10.9 %||–|
|Income taxes||–1.7||8.3||–79.5 %|
|Net profit (continuing operations)||0.3||8.7||–97.7 %|