EUWAX AG — Earnings Release 2003

May 4, 2004

News Details

Corporate | 4 May 2004 13:01

EUWAX AG reports record results in 2003

Corporate-news announcement sent by DGAP. The sender is solely responsible for the contents of this announcement. ——————————————————————————– The year 2003 has proved to be the most successful year in the corporate history of EUWAX AG and for its shareholders. The company has thereby even surpassed the previous record year of 2002. The excellent business performance at EUWAX AG was the result of new record highs for contract notes and for turnover in order book trading on the one hand, and a consistent management of costs combined with efficiency gains on the other. With new record figures in income, yearly cash flow and equity, the company is – in all areas of the financial and income situation – well positioned in a very dynamic and competitive market. Moreover, profitability and company value have been significantly increased for our shareholders. Income situation: growth with strong margins The good income performance, which has prevailed in previous years, has been highlighted by new records in 2003. Put into numbers, this positive result equals a net income of EUR 11.87 million (+40.9 % yoy) and an income from ordinary activities of EUR 21.73 million (+46.6 %). The Cash-Flow has increased by 43,5 % to a new record high of EUR 14.45 million. This strong income performance resulted from a large increase in earnings (+30.3 % to EUR 46.15 million), which was matched by an only moderate rise of expenditures (+18.5 % to EUR 24.41 million). Crucial elements for the higher expenditures were writedowns amounting to EUR 4.57 million (+52.7 %) and personnel expenditures of EUR 11.99 million (+27,4 %), which is in line with the success of the company. At EUR 2.34 and an increase of 13.8 %, the earnings per share reached – according to the DVFA calculation scheme – a new high, despite the substantially higher number of shares compared to the previous year (+23.9 %). This outstanding success of the past business year at EUWAX AG is based on the development of our core business area – order book trading. Contract notes increased by 28.2 % to 5.8 million. Turnover increased by 48.9 % to EUR 35.3 billion. This was accompanied by a further expansion of our market share in all our fields of business. Financial situation: continues to be sound At EUR 62.55 million, total assets have grown by EUR 10.46 million (+20,1 %) compared to the previous year. The equity-to-assets-ratio sank by 3.5 % to 84.8 %, but is still at a very high level. Accordingly, equity increased by 15.9 % to EUR 53.07 million. As of the end of 2003, liquid assets were valued at EUR 16.03 million (+65,0 %), thus reflecting EUWAX AG’s positive performance as a whole. Liquid assets including fixed deposits, which amounted to EUR 49.03 million (+23.5 %), also prove the strong financial situation of the company. Profitability: Return on equity after tax above 20 % The cumulated gross income return of 48.6 % (+14.8 %) shows clearly the good ratio between income and cost growth. The cost-income-ratio, which declined from 58.2 % to 52.9 %, completes the picture of the lean cost structure at EUWAX AG. In 2003, equity produced a return of 40.9 % before tax (32.4 % the previous year) and 22.4 % after tax (18.4 % in 2002). The return after tax has thus performed a positive reversal of trend, and could not be pushed below the 20 %-mark – even at a high level of tax of 45.4 % (+5.1 %). Our staff continues to highly identify with the company EUWAX AG, which is indicated by the increase of the share of variable remuneration of the total personnel expenditures to 60.3 %. Securities trading proves earnings power The stock-exchange related trading in derivatives presents the core of the company’s success. Turnover in this business area has increased by 54.1 % to EUR 20.8 billion. The other business units related to order book trading have also performed outstandingly. Turnover in the area of share trading rose to EUR 5.3 billion (+39.4 %), in the area of exchange traded funds to EUR 105 million (+132.5 %) and in the area of fixed income to EUR 9.1 billion (+42.9 %). The gains in market share that accompanied the increased turnover underline the strong position of EUWAX AG in the market. The already very high market share in turnover in covered warrants trading increased from 87.1 % to 88.9 %. For certificates, the figures improved significantly from 42.6 % to 55.1 %. Our market share in fixed income products, widened from 5.3 % to 7.2 %, in stocks and ETFs (both without XETRA(R)) to 15.3 % respectively 21.3 %. With an increase by 31.7 % to EUR 43.3 million, the result from securities trading reflects the excellent turnover figures and has set a new record. The highest share of this result has been generated by derivatives trading, whose result from order book trading increased to EUR 39.13 million. The entire result figures from order book trading have shown a gain in the share of provisions from 48.7 % to 56.4 %, which can therefore be identified as the main source of this gain. Share price follows the increase in shareholder value In 2003, the shares of EUWAX AG increased by 78.1 % to EUR 22.00, and have continued its rise in the first months of 2004. On April 28th, the shares sold at EUR 37.50, which corresponds to a market capitalisation of EUR 193.1 million. Our consistently sound business figures, as well as our successful value-based management promote the continued gains in value of our shares. By now, a growing number of investors relies on our sustained earnings power. The continued demand for our shares is the logical consequence of our historically good figures and our focus on sustaining a trustful relationship to our investors. EUWAX AG plans to pay an increased dividend of EUR 1.15 for the year 2003 and will thus continue with its investor-friendly measures of the past. The pay-out ratio remains high at about 50 %. Outlook Considering the course of the 1st quarter 2004, the company’s business planning for the full year has proved to be too conservative. Yet, the company keeps its relatively conservative forecast for the remaining year. Since it is to early to reliably forecast the remaining course of the year, the figures of the first quarter should not cause us to be enthusiastic. The economic as well as geopolitical environments still hold considerable risks for the further development of the capital markets. Though EUWAX AG has in the past proven its extraordinary earnings power especially in such difficult market conditions, this will not change our traditionally conservative business and communication policies. Target figures for the entire year of 2004 are: – Income from Ordinary Activities: EUR 23.01 million (+5,9 % yoy) – Net Income: EUR 13.51 million (+13,8 %) – Cash Flow: EUR 14.18 million (-1,9 %) – Earning per share: EUR 2.66 (+13,5 %) For further information or questions please contact: Harald Schnabel, CEO Tel.: +49 (0711) 222989-210 Fax: +49 (0711) 222989-363 eMail: harald.schnabel@euwax-ag.de Thomas Krotz, CFO Tel.: +49 (0711) 222989-360 eMail: thomas.krotz@euwax-ag.de end of message, (c)DGAP 04.05.2004 ——————————————————————————– WKN: 566010; ISIN: DE0005660104; Index: Listed: Amtlicher Markt in München und Stuttgart; Freiverkehr in Berlin-Bremen, Düsseldorf, Frankfurt und Hamburg; Xetra 041301 Mai 04