Quarterly Report • May 27, 2009
Quarterly Report
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Interim Group Report for the fi rst quarter 2009
| All fi gures in € million | 1st Quarter 2009 | 1st Quarter 20081 | Change |
|---|---|---|---|
| Continuing operations | |||
| Total revenues | 125.5 | 155.9 | –19.5 % |
| Revenues | 120.8 | 148.7 | –18.8 % |
| Other revenues | 4.7 | 7.2 | –34.7 % |
| Earnings before interest and taxes (EBIT) | 3.4 | 25.1 | –86.5 % |
| EBIT margin (in %) | 2.7 % | 16.1 % | – |
| Earnings from continuing operations | 0.3 | 8.7 | –97.1 % |
| Earnings per share (diluted) in € | 0.00 | 0.09 | –100.0 % |
| MLP Group | |||
| Net profi t (total) | –1.2 | 6.7 | >100.0 % |
| Earnings per share (diluted) in € | –0.01 | 0.07 | >100.0 % |
| Capital expenditure | 1.5 | 3.0 | –49.6 % |
| Shareholder's equity | 428.2 | 2 429.1 |
–0.2 % |
| Equity ratio | 29.4 % | 2 28.0 % |
– |
| Balance sheet total | 1,458.3 | 2 1,534.4 |
–5.0 % |
| Clients3 | 773,000 | 2 728,000 |
6.2 % |
| Consultants3 | 2,435 | 2 2,413 |
0.9 % |
| Branch offi ces3 | 252 | 2 241 |
4.6 % |
| Employees3 | 2,079 | 1,949 | 6.7 % |
| 3 Arranged new business |
|||
| Old-age provisions (premium sum in € billion) | 0.9 | 1.9 | –51.5 % |
| Health insurances (annual premium) | 13.3 | 11.8 | 12.7 % |
| Loans and mortgages | 236 | 270 | –12.6 % |
| Funds under management in € billion | 11.2 | 2 11.4 |
–2.2 % |
1 Adjustment of previous year's figures, see note 3
2 As at December 31, 2008
3 Continuing operations
| Interim Management Report for the fi rst quarter 2009 | 5 |
|---|---|
| Macroeconomic Environment | 5 |
| Situation within the Industry and the competitive environment | 6 |
| Company situation | 8 |
| Results of operations | 8 |
| Net assets | 12 |
| Financial position | 14 |
| Personnel | 15 |
| Communication and advertising activities | 16 |
| Legal corporate structure and executive bodies | 16 |
| Segment report | 17 |
| Risk report | 19 |
| Related party disclosures | 19 |
| Outlook for the current fi nancial year/forecast | 20 |
| Events subsequent to the reporting date | 22 |
| Investor Relations | 23 |
| Consolidated income statement and statement of comprehensive income | 25 |
| Balance sheet | 27 |
| Consolidated cashfl ow statement | 28 |
| Changes in consolidated shareholders' equity | 29 |
| Notes to the consolidated fi nancial statements | 30 |
| General information | 32 |
| Executive bodies at MLP AG | 42 |
| Financial Calendar | 43 |
MLP is the leading independent fi nancial services and asset management provider for academics and other discerning clients. The company integrates a multitude of products and services of various banks, insurance companies and investment houses to offer a fi nancial concept that is tailored to the requirements of each individual client. MLP clients benefi t from a holistic advisory approach covering all economic aspects that is guided by their particular requirements at their respective stages in life.
For its private client business in Germany, MLP boasts around 2,4oo consultants and operates approximately 25o branches – managing and serving some 77o,ooo clients.
MLP holds a full banking license and, together with the MLP Group company Feri Finance AG, manages assets of around € 11 billion – making it the leading independent asset gatherer in Germany. The training provided at the MLP Corporate University is regarded as the benchmark within the fi nancial consultancy industry. Commensurate with this status, the MLP Corporate University holds the coveted seal of quality granted by the European Foundation for Management Development (EFMD) and thus belongs to a small circle of twelve renowned corporate universities which can lay claim this status.
MLP generates over 98% of its total revenues in Germany and is therefore primarily infl uenced by the economic development in this market. The economic downturn in Germany that was triggered by the global fi nancial crisis, continued during the fi rst few months of the year. As the export-oriented German economy is so closely tied to the development of the global economy, it is being particularly hard hit by the worldwide fall in demand. In this respect the decline in gross domestic product (GDP) in the last quarter of 2oo8 was already signifi cantly worsening and stood at –2.1%. For the fi rst quarter of 2oo9 experts are expecting the economy to shrink by 2.2% compared to the previous quarter.
The effects of the economic weakness are now also clearly evident within the labor market. In the fi rst quarter the unemployment rate climbed to 8.5%, compared to 7.4% at the end of last year. Many companies are utilizing the short-time working facility which is currently still tempering the negative development within the labor market.
Private consumption is unable to counterbalance the decline in manufacturing – despite efforts to encourage private consumption through government economic stimulus programs. Furthermore, the negative expectations concerning the labor market are also contributing to a dampening of private consumption levels.
The continued weak macroeconomic environment in Germany has further heightened the nervousness and insecurity of consumers. From an MLP perspective this means that clients have been hesitant in making decisions about long-term investments such as the conclusion of old-age pension contracts or investments in wealth management concepts.
In the fi rst quarter of the current fi nancial year the development in the market for old-age pension provision was negative. Following the positive effect in the fi rst quarter of 2oo8 due to the fi nal stage of the state-subsidized premiums for Riester pensions ("Riester step"), this development did not really come as a surprise. Yet according to information released by the German Insurance Association (GDV) there was still a decline of around 1o% in new business even after taking the effect of the Riester step into account.
At the beginning of the year considerable interest was shown in the topic of "Home ownership Riester pensions" which since being introduced in 2oo8 have provided savers with the opportunity to use the state Riester subsidies to, for example, build or purchase a residential property for their own personal use as part of their old-age pension provision. According to the Federal Ministry of Labor and Social Affairs, over 4o,ooo people took up this state subsidy in the fi rst two months after introduction of the scheme.
The market for private health insurance showed positive development in the fi rst quarter. The rising number of treatment and care restrictions in the state insurance schemes has led to a notable increased level of interest on the part of consumers in switching to private health insurance. In addition, the strong public discussion surrounding the central health fund introduced on January 1, 2oo9 as well as the level of contributions to the state health insurance scheme are also contributing to a greater level of awareness by consumers of the requirement for better private health care provision.
Source: MLP-Health Report 2008
The fi nancial and economic crisis has also signifi cantly affected the market for wealth management. During the fi rst quarter of 2oo9, German investors continued to withdraw cash from investment funds. Fixed income and money market funds were particularly heavily affected, witnessing an outfl ow of funds of € 1.8 billion and € 1.6 billion respectively. Share-based investment funds recorded a net outfl ow of funds amounting to € o.5 billion.
Source: German Federal Association of Investment and Asset Management e. V.
According to information issued by the German Association of Investment and Asset Management (BVI), investors had invested € 565 billion in retail funds at the end of the fi rst quarter of 2oo9. At the same time last year this fi gure amounted to € 713 billion.
Since last year there have been increasing signs of a market consolidation within the German fi nancial services sector. For years the market for the sale of fi nancial services has been characterized by strong competition, yet also by great heterogeneity, and is in a state of fundamental change. This change was triggered by the wide range of regulatory amendments during the last two years, such as the EU brokerage guideline, the Markets in Financial Instruments Directive (MiFID) and the new Insurance Contract Law. These new framework conditions necessitated a high level of investment as well as creating new requirements with respect to training and further training within the industry. Competition for securing the services of well-trained and qualifi ed fi nancial consultants has also intensifi ed.
MLP is actively participating in the market consolidation. We have further improved our sales strength in the German market through the acquisition of the independent fi nancial broker ZSH which we fi rst announced in October 2oo8 and completed at the beginning of 2oo9.
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 fi rst quarter 2oo9 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).
In view of the far-reaching fi nancial 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 fi rst quarter. MLP stood up to a very diffi cult 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 fi nancial result in the fi rst quarter by € 2.4 million. This resulted in net profi t from continuing operations of € o.3 million (€ 8.7 million). MLP further increased its fi nancial strength with liquid funds rising to € 216.4 million (31.12.2oo8: € 21o.1 million). Particularly under the current conditions we are benefi ting from our fi nancial strength. Our excellent capital base provides us with extensive scope, also with respect to the expected upcoming consolidation within the industry.
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 fi rst quarter. Compared to the previous year, revenues in this area rose by 2o % to € 13.7 million (€ 11.4 million). Similar to the second half-year of 2oo8, the areas of MLP closely connected to the capital markets were again signifi cantly infl uenced by the fi nancial 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 € 2o.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 2oo9 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 (€ 1o.o million) in the fi rst quarter due to the lower level of interest rates.
The pleasing progress achieved in health insurance was also evident in the level of new business. In view of the signifi cant 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 € o.9 billion (EUR 1.9 billion) and was thus around the level achieved in 2oo7; the still relatively new business area of occupational pensions contributed a signifi cantly larger proportion towards this fi gure, amounting to 11 % (full year 2oo8: 8 %). The development in assets under management remained stable, totalling € 11.2 billion (31.12.2oo8: € 11.4 billion) – despite the fact that all the major share indices again suffered signifi cant losses in the fi rst quarter.
During the period from January to March, MLP gained a total of 6,6oo new clients. Including the acquired fi nancial broker ZSH, the total number of clients increased to 773,ooo. The number of consultants rose to 2,435 (31.12.2oo8: 2,413).
The commission expenses fell signifi cantly due to the decline in revenues from commissions and fees, amounting to € 41.5 million (€55.7 million) in the fi rst quarter of 2oo9. Our interest result during the period under review stood at € 4.6 million, thus almost equalling the level achieved in the fi rst quarter of 2oo8 (€ 4.8 million). Interest income fell from €1o.o 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.o million to € 4.4 million.
Other operating expenses rose from € 38.7 million to € 42.7 million. This fi gure 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 signifi cantly improved our fi nancial result in the fi rst quarter. Following € –8.1 million in the fi rst quarter of 2oo8, the fi nancial result in the fi rst quarter of the current fi nancial 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 fi rst quarter of 2oo9 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 profi t from discontinued operations improved slightly from € –1.9 million to € –1.4 million. In these fi gures 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 profi t of € 6.7 million). The basic and diluted earnings per share amounted to € –o.o1 (€ o.o7).
| All fi gures in € million | 1st Quarter 2009 | 1st Quarter 2008 | Change |
|---|---|---|---|
| Total revenues | 125.5 | 155.9 | –19.5 % |
| EBIT | 3.4 | 25.1 | –86.5 % |
| EBIT margin | 2.7 % | 16.1 % | – |
| Finance cost | –1.5 | –8.1 | 81.5 % |
| EBT | 2.0 | 17.0 | –88.2 % |
| EBT margin | 1.6 % | 10.9 % | – |
| Income taxes | –1.7 | 8.3 | –79.5 % |
| Net profi t (continuing operations) | 0.3 | 8.7 | –97.7 % |
| Net margin | 0.2 % | 5.6 % | – |
Total assets of the MLP Group in the period under review were slightly regressive, declining from € 1.53 billion to € 1.46 billion. On the asset side of the balance sheet the intangible assets rose by 7.8% to € 175 million due to additionally capitalised company assets from an acquisition.
During the period under review, the fi nancial investments and cash and cash equivalents rose signifi cantly and amounted to € 263.5 million (€ 218.o million). The changes arose mainly through the profi t transfer by the subsidiary MLP Finanzdienstleistungen AG.
Due to usual seasonal fl uctuations at the start of the year, other receivables and assets fell by 31.o% to € 1o1.5 million. This mainly contains receivables from insurance companies for whom we brokered insurance contracts. Due to the usual seasonal year-end business these rise considerably at the end of the year and then reduce during the course of the fi rst quarter.
| All fi gures in € million | March 31, 2009 | Dec 31, 2008 | Change |
|---|---|---|---|
| Intangible assets | 175.0 | 162.4 | 7.8 % |
| Property, plant and equipment | 83.8 | 80.4 | 4.2 % |
| Investment property | 11.6 | 11.7 | –0.9 % |
| Shares accounted for using | |||
| the equity method | 2.3 | 2.3 | – |
| Deferred tax assets | 1.9 | 1.3 | 46.2 % |
| Receivables from clients | |||
| from the banking business | 275.5 | 275.4 | – |
| Receivables from banks | |||
| from the banking business | 508.9 | 605.6 | –16.0 % |
| Financial investments | 230.4 | 179.9 | 28.1 % |
| Tax refund claims | 30.0 | 26.9 | 11.5 % |
| Other receivables and | |||
| other assets | 101.5 | 147.1 | –31.0 % |
| Cash and cash equivalents | 33.1 | 38.1 | –13.1 % |
| Non-current assets held | |||
| for sale and disposal groups | 4.1 | 3.3 | 24.2 % |
| Total | 1,458.3 | 1,534.4 | –5,0 % |
The equity capital of the Group at the reporting date remained almost unchanged at € 428.2 million (€ 429.1 million). The equity ratio improved from 28.o% to 29.4% and the equity capital situation of the Group remains very good.
Provisions rose by 7.o% to € 56.6 million (€ 52.9 million) due to acquisition activity and the increase in provisions for the customer care service fee payable to our consultants.
The other liabilities fell in accordance with usual seasonal fl uctuations from € 236.4 million to € 196.8 million.
The changes to our deposit business are shown in the liabilities towards clients and banks from the banking business. Together, these fell by 5.1% to € 763.2 million (€ 8o3.9 million). The fall is solely attributable to the reduction in client deposits from € 778.8 million to € 736.4 million. In this respect and in the main, funds were invested in monetary investment products of our wealth management business. The investment of client deposits is shown on the asset side of the balance sheet under the items receivables from clients and banks from the banking business. These also reduced, falling from € 881.o million to € 784.4 million. On the one hand this is attributable to the fall in client deposits but also to the profi t transfer from MLP Finanzdienstleistungen AG to MLP AG.
| All fi gures in € million | March 31, 2009 | Dec 31, 2008 | Change |
|---|---|---|---|
| Shareholders' equity | 428.2 | 429.1 | –0.2 % |
| Provisions | 56.6 | 52.9 | 7.0 % |
| Deferred tax liabilities | 9.9 | 9.6 | 3.1 % |
| Liabilities towards clients | |||
| from the banking business | 736.4 | 778.8 | -5.4 % |
| Liabilities towards banks | |||
| from the banking business | 26.8 | 25.0 | 7.2 % |
| Tax liabilities | 1.0 | – | – |
| Other liabilities | 196.8 | 236.4 | –16.8 % |
| Liabilities in connection with | |||
| non-current assets held | |||
| for sale and disposal groups | 2.7 | 2.6 | 3.8 % |
| Total | 1 ,458.3 | 1,534.4 | –5,0 % |
Cash fl ows from current business activities in the continuing operations fell from € 89.2 million to € 54.8 million. This is primarily due to the profi t transfer of € 46.8 million (€ 87.5 million) from MLP Finanzdienstleistungen AG to MLP AG. Cash fl ows from investment activities signifi cantly improved in the fi rst quarter of 2oo9, rising from € –15.2 million to € 38.8 million. Here, fi xed term deposits matured that had been invested with a term to maturity of over three months. The main infl uencing factor on the cash fl ow from the fi nancing activities was a share buyback programme last year. It thus amounted to € –11.5 million. We did not carry out any fi nancing activities in the fi rst quarter of 2oo9. Cash fl ow therefore amounted to € o.
At the end of the fi rst quarter the Group's total liquid funds stood at € 216.4 million. The liquidity situation therefore remains very good – the Group has adequate liquidity available. In addition to the liquid funds, MLP also has access to free credit lines.
| All fi gures in € million | 1st Quarter 2009 1st Quarter 2008 | |||
|---|---|---|---|---|
| Cash fl ows from operating activities | 54.8 | 89.2 | ||
| Cash fl ows from investing activities | 38.8 | –15.2 | ||
| Cash fl ows from fi nancing activities | – | –11.5 | ||
| Changes in cash and cash equivalents | 93.6 | 62.5 | ||
| Cash and cash equivalents at the beginning of the period | 38.0 | 36.6 | ||
| Infl ows/outfl ows due to divestments | –0.4 | – | ||
| Cash and cash equivalents at the end of period | 131.2 | 99.1 |
No capital measures were undertaken during the period under review.
During the fi rst three months of the current fi nancial year we invested a total of € 1.5 million (€ 3.o million). The major portion of these investments, amounting to around € 1.2 million, was allocated to our fi nancial services segment where we continued to invest in the improvement of IT support for client consulting activities and all relevant client care processes. However, the level of investment in this area has reduced signifi cantly as, in particular, our IT systems have now reached a level of performance that is regarded as exemplary in the industry. All investments were fi nanced from current cash fl ows.
At the end of the fi rst quarter of the current fi nancial year the MLP Group had a total of 2.079 employees, constituting a rise of 130 people compared to the fi rst quarter of 2008. This was, in part, due to the acquisition of ZSH. 1,803 (1,688) of the personnel were employed in the fi nancial services segment, 265 (249) in the Feri segment and 11 (12) in the holding segment. Further information concerning the development of personnel expenses and the employee structure are contained in the chapter "profi t situation" and in the notes.
| March 31, 2009 | March 31, 2008 | |
|---|---|---|
| Financial Services | 1,803 | 1,688 |
| Feri | 265 | 249 |
| Holding | 11 | 12 |
| Total | 2,079 | 1,949 |
In 2oo7 the Federal Ministry of Food, Agriculture and Consumer Protection (BMELV) commissioned a study concerning the quality of fi nancial consultancy in Germany. The results of the analysis ("Requirements of fi nancial brokers – better quality, better decisions") was presented to the public in December 2oo8. Ever since, fi nancial consulting has been the subject of intense discussion – and on a scale rarely previously witnessed. This creates a good platform to base the statutory framework conditions on a new foundation - and to realign them for the benefi t of clients and consumers. For many years MLP has been advocating the introduction of a higher and universal qualifi cation standard in the German fi nancial consulting market. We ourselves adopt an independent and holistic consulting approach that focuses on the individual requirements of clients. Against this background we emphatically welcome this initiative by the BMELV and support various requirements called for within the framework of this study. We have presented our stance in a statement.
MLP successfully completed the acquisition of ZSH in the fi rst quarter and fully consolidated the company from February on. This step enables MLP to targetedly strengthen its position among the medic client group. ZSH was founded in 1973 and provides services to wealthy private clients as well as to medical doctors and dentists, and covers all aspects of provision and fi nancial planning.
With effect from March 1, 2oo9, the Executive Board of MLP AG was enlarged to include the position of Chief Operating Offi cers (COO). On February 16, 2oo9 the Supervisory Board appointed Ralf Schmid as the new member of the Executive Board with a contract until December 31, 2o12.
The MLP Group structures its business into the following operative segments:
A detailed description of the individual segments is contained in the Annual Report 2008.
Total revenues in the fi nancial services segment fell signifi cantly, declining by 19.1% to € 117.o million (€ 144.6 million). It should however be noted that the fi rst quarter of 2oo8 included the increase in the subsidised premiums for the Riester pension (the so-called "Riester step"). The total costs also decreased in this segment but we were only able to achieve earnings before interest and taxes (EBIT) of € 9.o million (€ 26.3 million). The rise in personnel expenses was acquisition-related as well as being attributable to general salary increases and new hires. The other operating expenses increased mainly due to higher IT costs. Together with the fi nancial result amounting to € –o.4 million (€ –o.6 million) we achieved pre-tax profi t (EBT) of € 8.6 million (€ 25.7 million).
Total revenues in the Feri segment amounted to € 8.8 million (€ 1o.7 million). In view of the ongoing fi nancial and economic crisis investors continued to exercise restraint with respect to the investment of new monies. The international capital markets also declined in the period under review, leading to a fall in managed assets and thereby also to reduced recurring fees. The decrease in total costs by 7.5 % to € 9.8 million was unable to compensate for the decline in total revenues. We consequently achieved earnings before interest and taxes (EBIT) of € –1.o million (€ o.2 million). Pre-tax profi t (EBT) amounted to € –1.o million (€ o.4 million).
Total revenues in the Holding segment fell from € 4.1 million to € 3.2 million. The total revenues fi gure in the previous year included a subsequent profi t component from the sale of MLP Lebensversicherung AG in 2oo5 amounting to € o.3 million. The other operating expenses in this segment rose from € 3.4 million to € 6.1 million primarily due to one-off consulting services. This led to a decline in earnings before interest and tax (EBIT) from € –1.3 million to € –4.6 million. The fi nancial result fell from € 2.4 million to € 2.o million. Thus, pre-tax profi t (EBT) amounted to € –2.6 million (€ 1.2 million).
There were no signifi cant changes in the risk situation of the Group during the period under review. Despite the continuing fi nancial and economic crisis there were no exceptional burdens within the framework of our default, market, liquidity and operational risks. The Group continues to have adequate liquid funds. At the reporting date of March 31, 2oo9 our core capital ratio of 22.6% far exceeded the required 8% as prescribed by the supervisory body.
At the present time no existence-threatening risks to the MLP Group have been identifi ed.
A detailed presentation of the corporate risks as well as a description of our risk management is contained in our risk and disclosure report within the framework of the annual report 2oo8.
Related party disclosures are contained in the notes.
MLP's relevant core market is Germany where we generate around 98% of our total revenues. The development of the German economy is therefore of major importance to our business success. Following the signifi cant breakdown in the economy during the middle of 2oo8 due to the intensifi cation of the international fi nancial crisis and its effects on the real economy, the macroeconomic development perspectives in Germany for this year and next year have further deteriorated in the fi rst quarter of 2oo9. Whereas the expectations at the beginning of the year were for a decline in economic performance of 2%, the federal government has now revised its forecast downwards for the current year and is now expecting a fall of 6%. It is hoped that there will be a slight upturn during next year that could lead to growth of o.5%.
Source: International Monetary Fund (IWF), German Federal Government
With respect to the development of disposable incomes, economic researchers are basing their arguments for the current year above all on a further decrease in price infl ation. If energy prices in the coming quarters remain stable or fall further, this should increase the level of disposable income in Germany and facilitate continued sales of savings and provision products. Opposing infl uences are expected in the form of negative developments within the labor market. Concerns about job security or the level of income are unsettling clients and deterring them from making long-term investment decisions.
The macroeconomic framework conditions consequently remain diffi cult for MLP.
MLP's business activities are focussed on the areas of old-age pension provision and health insurance as well as wealth management. The fi nancial and economic crises remain the determining factors for development in the old-age pension and wealth management markets. Due to the degree of uncertainty about future economic development we continue to believe that clients will remain hesitant and restrained with respect to their investment decisions.
The topic of health insurance will remain a subject of public discussion during this current fi nancial year as some state health insurance funds will need to levy additional premiums, probably with effect from the middle of the year. The funding allocated to them from the new central healthcare fund will not be adequate to cover their costs. The public discussions surrounding this topic are helping to convince our clients of the need to maintain or improve their level of health cover by switching to private health insurance or by taking out private supplementary insurance policies.
The consolidation process that was set in motion as a result of the changes to the statutory framework conditions within the fi nancial services industry is likely to continue during the current fi nancial year. The fi nancial and economic crisis is accelerating this process as, particularly for many smaller providers, it is becoming increasingly diffi cult, to operate profi tably within the worsening economic environment.
As expected, the macroeconomic framework conditions continued to worsen during the fi rst quarter of 2oo9 and economic experts have again revised and lowered their forecasts for further development during the current year. In this respect, for example, the federal government is expecting a 6% decline in German economic output. As a decline of this magnitude is without precedent in the last 6o years, it is currently not possible to issue a respectable prediction of the effects of the crisis on the demand and investment behavior of clients. We therefore continue to refrain from giving a specifi c revenue and earnings forecast for the current fi nancial year. We have initiated a cost reduction program in order to protect the profi tability of the company. In doing so, we have introduced measures designed to reduce our fi xed cost base by € 34 million by the end of 2o1o. The cost reduction programme announced in February is on schedule. The cost base should fall by € 12 million in the fi nancial year 2oo9; additional savings of € 1o million are planned for the fi nancial year 2o1o. Furthermore, previous one-off expenses amounting to € 12 million will not be incurred in 2oo9.
A decisive factor concerning our ability to emerge from the continuing economic crisis in a stronger position is our fi nancial strength. Both our excellent equity capital situation as well as our very good liquidity strengthen our relative competitive position. With the necessary prudence we are cautiously optimistic for 2oo9 and strive to outperform the market.
There were no notable events after the balance sheet reference date that affected the MLP Group's net assets, fi nancial position or profi t situation.
During the fi rst few months of 2oo9 the stock markets continued to be infl uenced by the ongoing fi nancial and economic crisis. All the leading share indices showed negative development in the fi rst quarter. The American Dow Jones Industrial Average index recorded a decline of almost 16%. The DAX lost 18% compared to its level at the start of the year and the MDAX, in which the MLP share is listed, fell by over 23%. Financial stocks also developed negatively. At the end of the fi rst quarter the DAXsector Financial Services was around 17% lower than at the start of the year. At the start of April the markets began to recover signifi cantly, rising to around levels last seen at the start of the year.
Source: Deutsche Börse
As an independent fi nancial services and wealth management consulting company MLP is not directly affected by the crisis on the fi nancial markets, however the MLP share was unable to escape the market trend in the fi rst quarter. After ending the year 2oo8 at € 9.8o and rising to over € 1o during the middle of February 2oo9, the share then fell sharply, dropping as far as the € 5.25 level. Our share recovered to a certain extent by the end of the quarter, closing at € 7.9o. This recovery continued, and by the end of May the share price had risen to over € 1o again.
This year too we would once again like to enable our shareholders to participate appropriately in our corporate success. The Executive and Supervisory Boards are therefore proposing a dividend of € o.28 per share. Subject to approval by the Annual General Meeting on June 16, 2oo9 we will thus distribute € 3o.2 million to our shareholders. In this year, and in the coming years, MLP AG shareholders can receive a dividend distribution volume of up to around € 35o million tax-free. This results from the changed tax treatment of the incorporation of MLP AG subsidiaries into MLP AG and their subsequent sale, and is subject to fi nal confi rmation from the tax authorities.
The MLP Annual General Meeting 2oo9 will take place at 1o a.m. on June 16, 2oo9 at the Rosengarten Congress Center in Mannheim, Germany. Detailed information concerning the MLP Annual General Meeting can be found on our Investor Relations page at www.mlp-ag. de by clicking on the "Annual General Meeting" navigation link.
| All fi gures in €'000 | Note | 1st Quarter 2009 | * 1st Quarter 2008 |
|---|---|---|---|
| Revenues | (6) | 120,799 | 148,688 |
| Other revenues | 4,700 | 7,184 | |
| Total revenues | 125,499 | 155,872 | |
| Commission expenses | –41,516 | –55,718 | |
| Interest expenses | –4,592 | –5,176 | |
| Personnel expenses | (7) | –28,947 | –26,208 |
| Depreciation and amortisation | –4,390 | –4,992 | |
| Other operating expenses | (8) | –42,654 | –38,728 |
| Earnings from shares accounted for using the equity method | 29 | 80 | |
| Earnings before interest and taxes (EBIT) | 3,429 | 25,130 | |
| Other interest and similar income | 2,285 | 1,365 | |
| Other interest and similar expenses | (9) | –3,743 | –9,492 |
| Finance cost | –1,458 | –8,127 | |
| Earnings before taxes (EBT) | 1,971 | 17,003 | |
| Income taxes | –1,715 | –8,344 | |
| Earnings from continuing operations after taxes | 255 | 8,659 | |
| Earnings from discontinued operations after taxes | –1,449 | –1,947 | |
| Net profi t | –1,194 | 6,712 | |
| Net profi t attributable to | |||
| Owners of the parent company | –1,194 | 6,712 | |
| Earnings per share in € | |||
| From continuing operations | |||
| basic | 0.00 | 0.09 | |
| diluted** | 0.00 | 0.09 | |
| From continuing and discontinued operations | |||
| basic | –0.01 | 0.07 | |
| diluted** | –0.01 | 0.07 |
* Previous year's value adjusted. The adjustments are disclosed under note 3
** The ordinary shares resulting from the conversion of convertible debentures are treated as shares already issued
| All fi gures in €'000 | 1st Quarter 2009 | * 1st Quarter 2008 |
|---|---|---|
| Net profi t | –1,194 | 6,712 |
| Other comprehensive income | ||
| Securities marked to market | 253 | –834 |
| Income tax relating to components of other comprehensive income | –20 | 220 |
| Other comprehensive income, net of tax | 234 | –614 |
| Total comprehensive income for the year | –960 | 6,098 |
| Total comprehensive income attributable to | ||
| Owners of the parent company | –960 | 6,098 |
* Previous year's value adjusted. The adjustments are disclosed under note 3
** The ordinary shares resulting from the conversion of convertible debentures are treated as shares already issued
| Note All fi gures in €'000 |
March 31, 2009 December 31, 2008 | |
|---|---|---|
| Intangible Assets | 175,004 | 162,422 |
| Property, plant and equipment | 83,848 | 80,409 |
| Investment property | 11,633 | 11,700 |
| Shares accounted for using the equity method | 2,348 | 2,319 |
| Deferred tax assets | 1,853 | 1,326 |
| Receivables from clients from the banking business (10) |
275,498 | 275,433 |
| Receivables from banks from the banking business | 508,894 | 605,580 |
| Financial investments (11) |
230,393 | 179,941 |
| Tax refund claims | 30,049 | 26,870 |
| Other receivables and other assets (12) |
101,532 | 147,051 |
| Cash and cash equivalents | 33,126 | 38,088 |
| Non-current assets held for sale and disposal groups (13) |
4,084 | 3,281 |
| Total | 1,458,263 | 1,534,418 |
| Note All fi gures in €'000 |
March 31, 2009 December 31, 2008 | |
|---|---|---|
| Equity (14) |
428,165 | 429,125 |
| Provisions | 56,597 | 52,896 |
| Deferred tax liabilities | 9,870 | 9,597 |
| Liabilities towards clients from the banking business | 736,405 | 778,835 |
| Liabilities towards banks from the banking business | 26,761 | 25,024 |
| Tax liabilities | 966 | – |
| Other liabilities | 196,795 | 236,361 |
| Liabilities in connection with non-current assets held for sale | ||
| and disposal groups | 2,703 | 2,581 |
| Total | 1,458,263 | 1,534,418 |
| All fi gures in €'000 | 1st Quarter 2009 | 1st Quarter 2008 |
|---|---|---|
| Cashfl ow from operating activities | 55,707 | 89,934 |
| Cashfl ow from investing activities | 38,373 | –15,222 |
| Cashfl ow from fi nancing activities | – | –11,480 |
| Changes in cash and cash equivalents | 94,080 | 63,232 |
| Changes in cash and cash equivalents due to exchange rate movements | – | – |
| Cash and cash equivalents at the end of the period | 132,527 | 100,408 |
| Thereof discontinued operations | ||
| All fi gures in €'000 | 1st Quarter 2009 | * 1st Quarter 2008 |
| Cashfl ow from operating activities | 926 | 750 |
| Cashfl ow from investing activities | –439 | –47 |
| Cashfl ow from fi nancing activities | – | – |
| Changes in cash and cash equivalents | 487 | 703 |
| Changes in cash and cash equivalents due to exchange rate movements | - | – |
| Cash and cash equivalents at the end of the period | 1,287 | 1,308 |
* Previous year's value adjusted. The adjustments are disclosed under note 3
| All fi gures in €'000 | Equity attributable to MLP AG Shareholders |
Non control ling |
Total share holders |
|||||
|---|---|---|---|---|---|---|---|---|
| Share capital |
Capital reserves |
Securities market to market |
Other compre hensive income |
Treasury stock |
Total | interests | equity | |
| As at January 1, 2008 | 108,812 | 16,056 | –151 | 370,749 | –155,805 | 339,660 | 63 | 339,723 |
| Exertion of conversion rights | – | 206 | – | – | – | 206 | – | 206 |
| Acquisition of treasury stock | – | – | – | – | –11,455 | –11,455 | – | –11,455 |
| Reduction of capital – | ||||||||
| § 237 AktG | –10,821 | 10,821 | – | –167,260 | 167,260 | 0 | – | 0 |
| Acquisiton of remaining shares | ||||||||
| of BERAG | – | – | – | – | – | – | –63 | –63 |
| Transactions with owners | –10,821 | 11,027 | – | –167,260 | 155,805 | –11,249 | –63 | –11,312 |
| Total comprehensive income | – | – | –614 | 6,712 | – | 6,098 | – | 6,098 |
| As at March 31, 2008 | 97,992 | 27,083 | –765 | 210,201 | 0 | 334,510 | 0 | 334,510 |
| As at January 1, 2009 | 107,861 | 142,084 | –97 | 179,278 | – | 429,125 | – | 429,125 |
| Transactions with owners | – | – | – | – | – | – | – | – |
| Total comprehensive income | – | – | 234 | –1,194 | – | –960 | – | –960 |
| As at March 31, 2009 | 107,861 | 142,084 | 137 | 178,084 | – | 428,165 | – | 428,165 |
| All fi gures in €'000 | Financial services | ||
|---|---|---|---|
| 1st Quarter 2009 | 1st Quarter 2008* | ||
| Revenues | 113,354 | 139,167 | |
| of which with other segments | 56 | – | |
| Other revenues | 3,687 | 5,425 | |
| of which with other segments | 614 | 608 | |
| Total revenues | 117,041 | 144,592 | |
| Commission expenses | –41,323 | –55,257 | |
| Interest expenses | –4,593 | –5,176 | |
| Personnel expenses | –21,812 | –18,739 | |
| Depreciation and amortisation | –2,960 | –3,463 | |
| Other operating expenses | –37,360 | –35,757 | |
| Earnings from shares accounted for using the equity method | 29 | 80 | |
| Segment earnings before interest and taxes (EBIT) | 9,022 | 26,281 | |
| Other interest and similar income | 233 | 38 | |
| Other interest and similar expenses | –628 | –618 | |
| Finance cost | –394 | –580 | |
| Earnings before taxes (EBT) | 8,628 | 25,701 | |
| Income taxes | – | – | |
| Earnings from continuing operations after taxes | – | – | |
| Earnings from discontinued operations after taxes | –1,854 | –1,909 | |
| Net profi t | – | – |
| March 31, 2009 | Dec 31, 2008 | ||
|---|---|---|---|
| Segment assets | 1,039,288 | 1,157,796 |
* Previous year's value adjusted. The adjustments are disclosed under note 3
| Feri | Holding Consolidation/Other |
Total | |||||
|---|---|---|---|---|---|---|---|
| 1st Quarter 2009 1st Quarter 2008 | 1st Quarter 2009 1st Quarter 2008 | 1st Quarter 2009 | 1st Quarter 2008 1st Quarter 2009 1st Quarter 2008 | ||||
| 7,522 | 9,521 | – | – | –78 | – | 120,799 | 148,688 |
| 22 | – | – | – | –78 | – | – | – |
| 1,299 | 1,212 | 3,213 | 4,108 | –3,498 | –3,560 | 4,700 | 7,184 |
| – | 50 | 2,885 | 2,902 | –3,498 | –3,560 | – | – |
| 8,821 | 10,733 | 3,213 | 4,108 | –3,576 | –3,560 | 125,499 | 155,872 |
| –240 | –462 | – | – | 47 | – | –41,516 | –55,718 |
| – | – | – | – | 1 | – | –4,592 | –5,176 |
| –6,285 | –6,368 | –850 | –1,101 | – | – | –28,947 | –26,208 |
| –614 | –674 | –816 | –856 | – | – | –4,390 | –4,992 |
| –2,690 | –3,070 | –6,136 | –3,411 | 3,533 | 3,510 | –42,654 | –38,728 |
| – | – | – | – | – | – | 29 | 80 |
| –1,008 | 159 | –4,589 | –1,260 | 4 | –50 | 3,429 | 25,130 |
| 9 | 237 | 5,462 | 11,774 | –3,420 | –10,684 | 2,285 | 1,365 |
| –17 | 0 | –3,431 | –9,352 | 332 | 478 | –3,743 | –9,492 |
| –7 | 236 | 2,031 | 2,422 | –3,088 | –10,206 | –1,458 | –8,127 |
| –1,015 | 396 | –2,558 | 1,162 | –3,084 | –10,256 | 1,971 | 17,003 |
| – | – | – | – | – | – | –1,715 | –8,344 |
| – | – | – | – | – | – | 255 | 8,659 |
| – | – | – | – | 405 | –38 | –1,449 | –1,947 |
| – | – | – | – | – | – | –1,194 | 6,712 |
| March 31, 2009 | Dec 31, 2008 | March 31, 2009 | Dec 31, 2008 | March 31, 2009 | Dec 31, 2008 | March 31, 2009 | Dec 31, 2008 |
|---|---|---|---|---|---|---|---|
| 105,409 | 110,920 | 520,116 | 517,416 | –206,551 | –251,714 | 1,458,263 | 1,534,418 |
The consolidated fi nancial statements were prepared by MLP AG, Wiesloch, Germany, the parent company of the MLP Group. MLP AG is listed in the Mannheim Commercial Register under the number HRB 332697 at the address Alte Heerstraße 4o, 69168 Wiesloch, Germany.
Since it was founded in 1971, MLP has been operating as a broker and adviser for academics and other discerning clients in the fi elds of old-age provision including corporate pension business, healthcare, fi nancing, wealth management and banking services.
The interim fi nancial report has been prepared in line with the regulations set out in IAS 34 "Interim fi nancial reporting". It is based on the International Financial Reporting Standards (IFRS) of the International Accounting Standards Board (IASB) as well as the interpretations of the International Financial Reporting Interpretation Committee (IFRIC), as applicable within the European Union (EU). In accordance with the provisions of IAS 34, the scope of the report has been reduced compared to the consolidated fi nancial statements at December 31, 2oo8. The interim accounts were not subject to an independent auditor's review.
Apart from the exception detailed in note 3, the same consolidation principles and accounting policies as for the consolidated fi nancial statements of the fi nancial year 2oo8 have been applied to this interim fi nancial report. These are presented in the Group notes of the annual report 2oo8 that can be downloaded from the company's website (www.mlp. de).
The interim fi nancial report has been drawn up in euros (€), the functional currency of MLP AG. Unless the notes state otherwise, all amounts are rounded to the nearest thousand euros (€'ooo). Both single and cumulative fi gures are values with the smallest rounding difference. As a result, differences to reported total amounts may arise when the individual values are added up.
The accounting policies applied are the same as those used in the fi nancial year 2oo8, with the following exceptions.
In view of further concentration on its core market Germany, in the fourth quarter of the fi nancial year 2oo8 the management devised and began to actively implement a plan to sell MLP Finanzdienstleistungen AG, Vienna, Austria. Furthermore, since February 2oo9 MLP has been seeking a new ownership structure for the branch of MLP Finanzdienstleistungen AG in the Netherlands.
For this reason the revenues and expenses of MLP Finanzdienstleistungen AG, Vienna, Austria, and the MLP branch of MLP Finanzdienstleistungen AG in the Netherlands were reclassifi ed to the earnings from discontinued operations. The previous year's fi gures were adjusted accordingly. The reporting changes have no effect on net profi t or earnings per share.
The table below illustrates the effects of the changes in the accounting policies on the previous year's fi gures:
| All fi gures in €'000 | 1st Quarter 2008 adjusted |
1st Quarter 2008 as reported |
IFRS 5 |
|---|---|---|---|
| Revenues | 148,688 | 151,030 | –2,342 |
| Other revenues | 7,184 | 7,219 | –35 |
| Total revenues | 155,872 | 158,249 | –2,377 |
| Commission expenses | –55,718 | –56,572 | 854 |
| Interest expenses | –5,176 | –5,176 | 0 |
| Personnel expenses | –26,208 | –28,725 | 2,518 |
| Depreciation and amortisation | -4,992 | –5,043 | 51 |
| Other operating expenses | –38,728 | –39,567 | 839 |
| Earnings from shares accounted for using the equity method | 80 | 80 | 0 |
| Earnings before interest and taxes (EBIT) | 25,130 | 23,246 | 1,885 |
| Other interest and similar income | 1,365 | 1,368 | –3 |
| Other interest and similar expenses | –9,492 | –9,492 | 0 |
| Finance cost | –8,127 | –8,124 | –3 |
| Earnings before taxes (EBT) | 17,003 | 15,122 | 1,881 |
| Income taxes | –8,344 | –8,345 | 1 |
| Earnings from continuing operations | 8,659 | 6,777 | 1,882 |
| Earnings from discontinued operations | –1,947 | –65 | –1,882 |
| Net profi t | 6,712 | 6,712 | 0 |
| Earnings per share in € | |||
| from continuing operations | |||
| basic | 0.09 | 0.07 | |
| diluted | 0.09 | 0.07 | |
| from continuing and discontinued operations | |||
| basic | 0.07 | 0.07 | |
| diluted | 0.07 | 0.07 |
In the fi nancial year 2oo9, the revised IAS 1 "Presentation of Financial Statements" is to be used for the fi rst time. IAS 1 (revised) extends the profi t and loss account to include a transition of profi t/loss to the overall net earnings with reporting of the components of the other earnings (statement of comprehensive income). This also changes the presentation of the statement of changes in equity. In the statement of changes in equity, transactions with owners are shown separately. Profi t/Loss and other earnings are apportioned to the individual equity capital components. The previous year's fi gures were adjusted accordingly. Neither net profi t nor earnings per share have changed as a result of this changed presentation.
Furthermore, in the fi nancial year 2oo9 the following new or revised standards are to be used for the fi rst time:
The fi rst-time use of these standards did not have any effect on the presentation of the MLP Group's net assets, fi nancial position or results from operations.
In order to strengthen its market position among medics, MLP purchased all company shares in ZSH Vermittlung von Versicherungen und Vermögensanlagen Verwaltungs GmbH, Heidelberg, and all limited partner's shares in ZSH Vermittlung von Versicherungen und Vermögensanlagen GmbH & Co KG, Heidelberg ("ZSH GmbH & Co KG") on February 4, 2oo9.
The object of ZSH GmbH & Co KG is the administration and brokerage of all types of insurance policies and investments, real estate and loans as well as the provision of other services economically related to the aforementioned objects.
The provisional purchase price for the acquisition amounts to € 11,731 thsd and will be paid from liquid assets. At the time of preparation of the interim consolidated fi nancial statements the purchase price allocation from this acquisition had not been concluded. The provisional differential amount which results from the difference between the anticipated purchase costs of the company acquisition and the provisional fair value of assets, liabilities and contingent liabilities identifi ed so far amounts to € 14,o12 thsd. It is shown as goodwill. See below for the calculation of the provisional goodwill.
| All fi gures in €'000 | Carrying amount before purchase |
Adjustment | Fair value |
|---|---|---|---|
| Intangible assets | 475 | – | 475 |
| Property, plant and equipement | 4,809 | – | 4,809 |
| Financial investments | 123 | – | 123 |
| Other receivables and | |||
| other assets | 3,391 | – | 3,391 |
| Cash and cash equivalents | 1,738 | – | 1,738 |
| Provisions | –1,499 | – | –1,499 |
| Liabilities | –9,895 | – | –9,895 |
| Net assets | –859 | – | –859 |
| Pro rata net assets | 100 % | –859 | |
| Goodwill | 14,012 | ||
| Purchase price | 11,731 | ||
| Incidential acquisition expenses | 1,422 | ||
| Acquisition costs | 13,153 | ||
| Cash outfl ow to date due to the acquisition | 10,084 |
The ZSH contributed € –228 thsd to the interim result. If the business merger had taken place at the beginning of the year, the net profi t would have been € –1,o47 thsd and the revenues from continuing operations for the fi rst quarter of 2oo9 would have totalled € 122,259 thsd.
The fi nancial crisis and the associated fears of recession remain the determining negative factors for client demand for professional fi nancial consulting services. Due to seasonal infl uences on its business operations, the Group nevertheless anticipates a higher level of net profi t from continuing operations for the remainder of the fi nancial year than was achieved in the fi rst quarter.
| All fi gures in €'000 | 1st Quarter 2009 | 1st Quarter 2008 |
|---|---|---|
| Old-age provision | 62,886 | 87,451 |
| Wealth management | 17,165 | 20,475 |
| Non-life insurance | 15,229 | 15,580 |
| Health insurance | 13,678 | 11,377 |
| Loans and mortgages | 1,952 | 3,045 |
| Other commissions and fees | 673 | 778 |
| Comission and fees | 111,582 | 138,707 |
| Interest income | 9,217 | 9,981 |
| Total | 120,799 | 148,688 |
Personnel expenses increased from € 26,208 thsd to € 28,947 thsd. The increase is primarily due to general salary increases, additional personnel and the acquisitions of ZSH GmbH & Co KG and the TPC-Group.
At March 31, 2oo9, the operating segments had the following numbers of employees in the strategic fi elds of business:
| March 31, 2009 | of which part-time employees |
March 31, 2008 | of which part-time employees |
|
|---|---|---|---|---|
| Financial services | 1,803 | 418 | 1,688 | 446 |
| Feri | 265 | 62 | 249 | 57 |
| Holding | 11 | 1 | 12 | 1 |
| Total | 2,079 | 481 | 1,949 | 504 |
The increase of the numbers of employees in the fi nancial services segment is caused by the acquisition of the ZSH GmbH & Co KG (61 employees).
| All fi gures in €'000 | 1st Quarter 2009 | 1st Quarter 2008 |
|---|---|---|
| IT costs | 11,307 | 10,032 |
| Cost of premises | 5,791 | 5,269 |
| Audit and consultancy costs | 5,458 | 3,310 |
| Training and seminars | 3,398 | 3,006 |
| Communication requirements | 2,091 | 2,142 |
| Banking-related expenses | 1,881 | 2,114 |
| Allowances for bad debts | 1,873 | 2,102 |
| Advertising expenses | 1,638 | 1,733 |
| Representation and entertainment expenses | 1,438 | 1,375 |
| Rental and leasing | 1,331 | 1,293 |
| Expenses for consultants and branch offi ce managers | 635 | 628 |
| Insurances | 610 | 861 |
| Offi ce supplies | 531 | 685 |
| Travel expenses | 464 | 438 |
| Premiums and fees | 459 | 419 |
| Vehicle costs | 409 | 221 |
| Expenses for corporate communications | 407 | 387 |
| Other personnel costs | 373 | 422 |
| Losses on the disposal of intangible assets and | ||
| property, plant and equipment | 228 | 60 |
| Currency translation expenses | 29 | 152 |
| Share-based payment (convertible debentures) | – | 206 |
| Sundry other operating expenses | 2,303 | 1,874 |
| Total | 42,654 | 38,728 |
The increase in IT costs is primarily due to higher computer centre and consulting expenses in connection with the provision of an expanded spectrum of services as well as the optimization of applications. The auditing and consulting costs contain one-off costs that were incurred for legal and capital market-relevant consulting services in connection with Swiss Life's stake in MLP and associated effects. The sundry other operational expenses mainly comprise external services, repairs and maintenance costs, donations, gestures of goodwill as well as other taxes.
| All fi gures in €'000 | 1st Quarter 2009 | 1st Quarter 2008 |
|---|---|---|
| Other interest and similar income | 2,285 | 1,365 |
| Interest from fi nancial instruments | –3,596 | –9,333 |
| Accrued interest on pension provisions | –147 | –144 |
| Losses on the disposal of fi nancial investments | 0 | –15 |
| Other interest and similar expenses | –3,743 | –9,492 |
| Finance cost | –1,458 | -8,127 |
The increase in interest income results from the interest yield on risen liquid assets. The fall in interest expenses is attributable to depressed dividend distribution payments to the other shareholders of Feri Finance AG which amounted to € 2,368 thsd (previous year: € 7,83o thsd).
The reduction in receivables from banks from € 6o5,58o thsd to € 5o8,894 thsd mainly results from the transfer of the profi t by MLP Finanzdienstleistungen AG to MLP AG.
| All fi gures in €'000 | March 31, 2009 | Dec 31, 2008 |
|---|---|---|
| Available for sale | ||
| Debt securities and holdings in investment funds | 44,653 | 47,885 |
| Investments | 4,244 | 4,227 |
| Held-to-maturity securities | 26,355 | 22,828 |
| Loans and receivables | 155,139 | 105,002 |
| Total | 230,393 | 179,941 |
The rise in fi nancial investments mainly results from the investment of the funds as fi xed term deposits stemming from the profi t transfer from MLP Finanzdienstleistungen AG.
Due to the seasonally stronger year-end business, high receivables from insurance companies as well as high liabilities towards commercial agents at December 31, 2oo8 had to be shown which were then balanced out in the fi rst quarter of 2oo9. A lower amount of receivables and liabilities were built up in the fi rst quarter of 2oo9.
This balance sheet item includes certain fund holdings held for sale as well as the discontinued operations of MLP Finanzdienstleistungen AG, Vienna, Austria, and the branch of MLP Finanzdienstleistungen AG in the Netherlands.
The share capital consists of 1o7,861,141 (December 31, 2oo8: 1o7,861,141) no-par-value shares in MLP AG. In the fi rst quarter of 2oo9 no new no-par-value shares were issued through the exercising of rights of conversion.
The Executive and Supervisory Boards propose to the Annual General Meeeting on June 16, 2oo9 a dividend of € o.28 per share for the fi nancial year 2oo8. For the fi nancial year 2oo7 MLP AG distributed a dividend amounting to € o.5o per share in the second quarter 2oo8.
In view of further concentration on its core market Germany, in the fourth quarter of the fi nancial year 2oo8 the management devised and began to actively implement a plan to sell MLP Finanzdienstleistungen AG, Vienna, Austria. For the same reason, since February 2oo9 MLP has been seeking a new ownership structure for the branch of MLP Finanzdienstleistungen AG in the Netherlands. The revenues and expenses from these and earlier discontinued operations are illustrated below.
| All fi gures in €'000 | 1st Quarter 2009 | 1st Quarter 2008 |
|---|---|---|
| Revenues | 1,848 | 2,342 |
| Other revenues | 31 | 35 |
| Total revenues | 1,880 | 2,377 |
| Commission expenses | –842 | –854 |
| Personnel expenses | –1,359 | –2,518 |
| Depreciation and amortisation | –3 | –51 |
| Other operating expenses | –1,200 | –839 |
| Earnings before interest | ||
| and taxes (EBIT) | –1,525 | –1,885 |
| Other interest and similar income | 3 | 3 |
| Other interest and similar expenses | –1 | 0 |
| Finance cost | 2 | 3 |
| Earnings before taxes | ||
| (EBT) | –1,523 | –1,881 |
| Income taxes | –5 | –1 |
| Earnings from discontinued operations after taxes | –1,528 | –1,882 |
| Earnings from the sale of the operations before taxes | –2 | –80 |
| Income taxes | 82 | 15 |
| Earnings from the sale of operations after taxes | 79 | –65 |
| Earnings from discontinued operations after taxes | –1,449 | –1,947 |
| Earnings per share in € | ||
| from discontinued operations | ||
| basic | –0.01 | –0.02 |
| diluted | –0.01 | –0.02 |
The operative results in 2oo8 and 2oo9 contain solely the expenses and revenues of the foreign subsidiary in Austria and the branch in the Netherlands.
Cash and cash equivalents with a term to maturity of not more than three months are recorded under cash and cash equivalents. Cash equivalents are short-term fi nancial investments which can be converted into cash at any time and which are only subject to minor value fl uctuation risks.
| All fi gures in €'000 | March 31, 2009 | March 31, 2008 |
|---|---|---|
| Cash and cash equivalents | 33,126 | 80,370 |
| Cash and cash equivalents, contained in | ||
| non-current assets held for sale and disposal groups | 1,287 | – |
| Restraints | – | –17 |
| Other investments < 3 months | 100,000 | 20,068 |
| Liabilities to banks due on demand | –1,886 | –13 |
| Cash and cash equivalents | 132,527 | 100,408 |
The receivables from fi nancial institutions of MLP Finanzdienstleistungen AG are not included in cash and cash equivalents as they are to be attributed to the current business activities of the banking business segment (formerly: MLP Bank AG).
The operating cash fl ow is primarily infl uenced by the payment of the profi t transfer by MLP Finanzdienstleistungen AG to MLP AG amounting to € 46,75o thsd (previous year: € 87,481 thsd).
In the current fi nancial year the cash fl ow from investment activites is primarily infl uenced by maturing fi xed-term money deposits that were invested with a remaining term of over 3 months.
In the fi nancial year 2oo9 the operating segment fi nancial services was expanded due to the addition of ZSH GmbH & Co KG which was acquired on February 4, 2oo9. In addition, the expenses and revenues associated with the branch of MLP Finanzdienstleistungen AG in the Netherlands were reclassifi ed to discontinued operations. The change in segment assets is infl uenced by the acquisition of ZSH GmbH & Co KG and the profi t transfer from MLP Finanzdienstleistungen AG.
Beyond this there were no signifi cant changes compared to December 31, 2oo8.
There were no signifi cant changes in the contingent liabilities and other obligations during the period under review.
Compared to December 31, 2oo8 there were no signifi cant changes in the relationships and no signifi cant business with related companies and persons.
There were no notable events after the balance sheet date which may affect the MLP Group's net assets, fi nancial position or results of operations.
Wiesloch, May 12, 2oo9
MLP AG
Executive Board
Dr. Uwe Schroeder-Wildberg Gerhard Frieg Muhyddin Suleiman Ralf Schmid
Gerhard Frieg (Product management and Purchasing, appointed until May 18, 2o12)
Muhyddin Suleiman (Sales and Marketing, appointed until September 3, 2o12)
Ralf Schmid (Chief Operating Offi cer, Member of the Executive Board of MLP AG since March 1, 2oo9, appointed until December 31, 2o12)
Supervisory Board Dr. Peter Lütke-Bornefeld (Chairman)
Dr. h. c. Manfred Lautenschläger (Vice Chairman)
Dr. Claus-Michael Dill
Johannes Maret
Maria Bähr (Employee representative)
Norbert Kohler (Employee representative)
| May 13 | Results for the 1st Quarter 2009 | |
|---|---|---|
| May 26 | Equinet European Small and Midcap Conference | London |
| June 16 | Annual General Meeting 2009 | Mannheim |
| June 17–18 | Roadshow, Europe | |
| June 24–25 | Roadshow, Skandinavia | |
| July 01–02 | Roadshow, Europe | |
| July 20–August 12 | Quiet Period* | |
| August 12 | Results for the 2nd Quarter 2009 | |
| August 19–20 | Roadshow, Europe | |
| September 15–17 | Roadshow, USA | |
| September 24 | HVB UniCredit German Conference | Munich |
| Oktober 19–November 11 | Quiet Period* | |
| November 11 | Results for the 3rd Quarter 2009 | |
| November 18–19 | Roadshow, Europe | |
| December 02–03 | Roadshow, Europe |
* During this period - immediately prior to the results - MLP limits its communication with the capital market
Investor Relations Tel +49 (o) 6222 • 3o8 • 832o Fax +49 (o) 6222 • 3o8 • 1131 [email protected]
Public Relations Tel +49 (o) 6222 • 3o8 • 831o Fax +49 (o) 6222 • 3o8 • 1131 [email protected]
This documentation includes certain prognoses and information on future developments founded on the conviction of MLP AG's Executive Board and on assumptions and information currently available to MLP AG. Words such as "expect," "anticipate," "estimate," "assume," "intend," "plan," "should," "could," "project" and other similar terms used in reference to the company describe prognoses based on certain factors subject to uncertainty.
Many factors can contribute to the actual results of the MLP Group differing signifi cantly from the prognoses made in such statements.
MLP AG accepts no liability to the public for updating or correcting prognoses. All prognoses and predictions are subject to various risks and uncertainties, which can lead to the actual results differing from expectations. The prognoses refl ect the points of view at the time when they were made.
MLP AG Alte Heerstrasse 40 69168 Wiesloch, Germany Tel +49 (0) 6222 • 308 • 0 Fax +49 (0) 6222 • 308 • 9000 www.mlp-ag.de
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