MLP SE — Investor Presentation 2014

Jul 14, 2015

The MLP Group – The partner for all financial matters

Dr. Uwe Schroeder-Wildberg, CEO

Agenda

MLP at a glance 3

• Benefits for shareholders 7
• Key financials 2014 14
• Impact of regulation 21
• Outlook MLP 26

The MLP Group at a glance

MLP Group

• The views and expectations of our clients always represent the starting point in each of these fields
• We examine the offers of all relevant product providers in the market
• We then present our clients with suitable options in a comprehensible way so that they can make the right financial decisions themselves

Our product ratings are based on scientifically substantiated market and product analyses.

Consulting services throughout Germany for private, corporate and institutional clients

MLP Group

MLP:

• Approximately 1,950 client consultants
• Approximately 160 offices at least one at every university location
• Approximately 1,300 employees at company HQ and at local offices

FERI:

• Approximately 220 employees
• International locations: Vienna, Zurich and Luxembourg

TPC:

• Approximately 25 employees
• Client consulting together with MLP client consultants

MLP Group – An Overview

Clients		• More than 845,000 private clients in the mass affluent segment of the market target groups: graduates (i.e. physicians, solicitors, engineers and economists) • Over 200 private clients in the HNWI market & over 5,000 corporate clients, employers and institutional clients
as e	Old-age provision	Brokered premium sum for new business totalled € 4.1 billion in 2014. Share of revenue '14 Occupational pension provision accounted for around 12% of this figure.
ar s s e n si u b	Wealth Management	€ 27.5 billion in assets under management as at December 31, 2014 in business with mass affluent clients, HNWI and institutional investors.	49% 30%
n ai M	Health insurance	Private health insurance, supplementary private health insurance, long-term care, occupational health insurance, statutory health insurance.
Top Financials		FY 2014: Total revenue: EBIT: Net profit:	€ 531.1 million € 39.0 million € 29.0 million	Equity Ratio: Core Capital Ratio:	23.2% 13.6%	Dividend per share: Return on Equity:	€ 0.17 7.8%
MLP Share			Shares outstanding: 107,877,738	Free Float: 48.02% (Definition on the German stock exchange) Average daily trading volume: 70,800 (Xetra, 12-month average as at June 30th, 2015)

Agenda

MLP at a glance 3

• Benefits for shareholders 7
• Key financials 2014 14
• Impact of regulation 21
• Outlook MLP 26

MLP – Benefits for shareholders

Significant strengthening of the revenue base through strategic further development

Company pensions	Wealth Management	Real estate	Broadening Non-life
2004 2006 Formation MLP acquires of business division stake in FERI AG "company pensions" 2011 MLP acquires 2008 Acquisition of TPC the remaining shares in FERI as scheduled		2011 Start of real estate offerings 2014 Expansion of the real estate offerings	2015 Acquisition of DOMCURA Group • Underwriting agency • Further, strategically relevant business segment • Significant potential with existing business
FY 2005 FY 2014 Revenue from commissions and fees: € 467.9 million Revenue from commissions and fees: € 486.9 million
4%2%1% 10%	2% 3% 7% 9%		Old-age provision incl. occupational pension business

30% 49%

1

Non-life insurance

Loans and mortgages

Other commissions and fees (i.e. real estate)

Wealth management

Health insurance

80%

3%

Administration costs reduced by more than € 50 million – solid foundation for the future 1

Administrative costs*

* Definition: Personnel expenses, depreciation and amortisation and other operating expenses

** Adjusted to include one-off expenses

Attractive dividend policy: pay-out ratio of 50% to 70%

Return on dividend

in % 0 2 4 6 8 10 12 2009 2010 2011* 2012 2013 2014

* Including special dividend

• In the future, pay-out ratio of 50% to 70% of Group net profit
• At the same time capital is required for:
• Acquisitions
• Investments
• Capital management (Basel III)

2

Stable shareholder structure

3

Share details	WKN: ISIN: Börsen:	656 990 DE0006569908		XETRA, Frankfurt, other regional exchanges
Shareholder structure	Dr. h. c. Manfred Lautenschläger HDI Barmenia Allianz SE Angelika Lautenschläger Freefloat (Def. Deutsche Börse) Harris Associates FMR LLC Schroders PLC Franklin Templeton	23.53% 9.48% 6.67% 6.27% 6.03% 48.02% 9.82% 7.10% 3.07% 2.99%	Freefloat	Dr. h. c. Manfred Lautenschläger Angelika Lautenschläger Barmenia Allianz SE HDI Pensionskasse
Research coverage	Equinet/ESN Bankhaus Lampe Main First Independent Research HSBC Global Research	Accumulate Buy Underperform Hold Underweight	PT 4.30 PT 4.20 PT 3.60 PT 4.50 PT 3.90

Agenda

• MLP at a glance 3
• Benefits for shareholders 7
• Key financials 2014 14
• Impact of regulation 21
• Outlook MLP 26

FY 2014: Total revenue rises to € 531.1 million

Total revenue in Q4 Total revenue in FY

Upturn in old-age provision – new record in the wealth management

Revenue

in € million

	Q4 2014	Q4 2013*	∆ in %	2014	2013*	∆ in %
Old-age provision	106.6	88.3	20.7	239.7	219.9	9.0
Wealth management	41.3	37.7	9.5	147.0 117,9	138.1	6.4
Health insurance	11.6	11.5	0.9	43.5	47.8	-9.0
Non-life insurance	5.0	5.4	-7.4	34.6	32.5	6.5
Loans and mortgages**	4.5	4.7	-4.3	13.6	14.5	-6.2
Other commissions and fees	3.0	2.0	50.0	8.4	4.9	71.4
Interest income	5.8	5.5	5.5	22.9	22.8	0.4

* Previous year's values adjusted, ** excluding MLP Hyp

Continuingly difficult environment – MLP gains market share

New business in the market remains well below normal levels

Market development

Old-age provision:

Premium sum of new business in € billion

Health insurance:

Holders of comprehensive insurance in millions

MLP development

Old-age provision:

Premium sum of MLP´s new business in € billion

Health insurance:

Holders of comprehensive insurance in thousands

Sources: German Insurance Association (GDV e.V.), Association of Private Health Insurers

27,900 new clients

New clients (gross)

Client consultants

FY 2014: EBIT rose by 27 percent to € 39.0 million

Income statement Verwaltungskosten steigen aufgrund der

in € million

	Q4 2014	Q4 2013*	2013*	2014	2013
Total revenue	186.4	162.3		531.1	499.0
EBIT	29.6	20.5		39.0	30.7
Finance cost	-1.2	0.2		-1.3	0.2
EBT	28.4	20.7		37.6	30.8
Taxes	-6.6	-4.7		-8.7	-6.9
Group net profit	21.8	16.0		29.0	23.9
EPS in € (diluted/undiluted)	0.20	0.15		0.27	0.22

256,8 Mio. € (2013: 250,6 Mio. €)

Return on equity 7.8 percent

in € million

	31/12/2014	31/12/2013*
Intangible assets	156.2	155.3
Financial investments	145.3	146.1
Cash and cash equivalents	49.1	46.4
Other receivables and other assets	117.7	104.7
Shareholders' equity	376.8	370,5
Equity ratio	23.2%	24.2%
Other liabilities	117.8	108.7
Total	1,624.7	1,533.6

• Equity ratio: 23.2% (24.2%)
• Return on equity: 7.8% (6.4%)
• Core capital ratio: 13.6% (16.7%)

* Previous year's values adjusted

Agenda

• MLP at a glance 3
• Benefits for shareholders 7
• Key financials 2014 14
• Impact of regulation 21
• Outlook MLP 26

Fundamental changes in the market

Client behaviour

• Fundamental scepticism on the part of clients towards the financial industry since the outbreak of the financial crisis
• Quick and inexpensive information possibilities for clients via the internet
• Distinct desire to make their own financial decisions

Demographics

• Rising life expectancy and low birth rate lead to a significantly ageing society
• Increasing pressure on state social welfare systems
• Number of people in work constantly falling

Regulation

• Since 2004 and especially since 2008 intensive regulation
• In addition to impacting at the product level, regulation also particularly applies to the training of consultants, documentation and transparency

Trend Effects

• Intense competition
• Quality of consulting services and differentiation from the competition continue to gain in significance
• Contract conclusion for simple products sometimes takes place without consultation
• Great need for private and occupational old-age provision as well as private health insurance
• Recruiting: Good labour market perspectives leads to a "war of talents" for well-educated/trained individuals
• Significant rise in administrative activities burdens productivity
• Increase in fixed costs for training, IT systems and administration
• Quality becoming an increasingly important aspect

Regulation strongly increased since 2004

EU law	EU Insurance Mediation Directive (IMD) Directive (MiFID)	EU Markets in Financial Instruments			Instruments Directive (MiFID II)	(IMD II)	Draft amending the EU Markets in Financial Draft directive amending the EU Insurance Mediation Directive			Implementation of MiFID II of IMD II 2015 –	Implementation
	2004 – 2009	2010	2011		2012		2013		2014	2017
German law	(VVG) • (MiFID) • •	Introduction of the German Insurance Act Disclosure of the contract and marketing expenses factored into the premium Introduction of the Markets in Financial Instruments Directive Implementation of the EU Insurance Mediation Directive (IMD) Information disclosure requirements Documentation requirements		• • •	Act Reforming the Laws on Intermediaries for Financial Products Cap for acquisition commission (max. 9.9 monthly premiums) Improvement Act (AnsFuG) Product information sheets Disclosure of costs in wealth management		Investments and on Investment in the private health insurance sector Investor Protection and Functionality	•	Life Insurance Reform Act (LVRG) • Maximum zillmerisation • Cost transparency • Change in Commission payment method anticipated Fee-Based Investment Advisory Service Act (HAnlBG) Protected job title for fee-based consultants for wealth	National regulations IMDII and MiFID II National regulations IMD II and MiFID	II rate management

Life Insurance Reform Act (LVRG) – Inducing possible future commission models

Some insurance companies plan changes starting not before 2016

Significant increase in consolidation within the market due to LVRG

Number of insurance intermediaries in Germany Effects of the Life Insurance Reform Act (LVRG)

• Quality of consultancy and portfolio will become even more important
• Sale organisations with a high cancellation rate will lose trail commissions
• Major challenges for pyramid sales organisations

Source: DIHK, entries in the Insurance Intermediary Register

MLP's business model is well aligned for the altered market conditions

Success factors	MLP
Client-centred business model	• No own products – MLP selects from the ranges offered by relevant providers • Leading training and further training, high quality consulting • Fulfilment of the highest regulatory requirements (Insurance broker, banking license, AIFM license)
Size & financial strength	•Germany's largest insurance broker / IFA • 1,931 consultants •AuM of € 29.0 billion
IT support & back office	•Extensive investments in IT •Specific support for consultants through service centres •Preparation of online contract conclusion process for simple products
Cost control	•Significant reduction in administration costs since 2008 • Continuous cost control implemented • Revenue costs are largely variable

Agenda

• MLP at a glance 3
• Benefits for shareholders 7
• Key financials 2014 14
• Impact of regulation 21
• Outlook MLP 26

Continuation of the growth initiatives

	Priorities
1. Online strategy	• Expansion of the internet into an important interface for acquiring new clients and stimulating interest among potential clients • MLP financify established as heading when addressing young adults • Online sale of basic products planned • Video conferences and e-signatures as service for existing customers planned
2. Recruiting	• New consultant start-up programmes introduced in 2013 as the basis • Easement for new consultants to start into self-employment • Revision of education for new consultants • Expansion of the internship programme • Continuation of the strategy to open new offices in the university segment  The quality of new consultants remains the top priority	Making MLP Making more independent MLP more of short-term independent market influences of short-term market
3. Broadening the revenue basis	• Further strengthening of the real estate business introduced in 2014; three new product partners • Expansion of the non-life insurance segment – Acquisition of the DOMCURA Group • Further strengthening of the Real and Alternative Assets segment at FERI; further acquisitions possible at FERI • Further expansion of wealth management activities	influences

Outlook: MLP anticipates EBIT above previous year's level

Administrative costs*

* Definition: Personnel expenses, depreciation and amortisation and other operating expenses

** Adjusted to include one-off expenses

Sales revenue

In each case compared to the previous year

	2015
Revenue from old-age provision	Stable development
Revenue from health insurance	Slight increase
Revenue from wealth management	Slight increase
Other commissions and fees (real estate)	Significant increase

Despite continuingly difficult markets and extensive investments, MLP anticipates a slight increase in EBIT for 2015

• MLP has targetedly further developed its business model in the past few years.
• Despite operating in difficult markets, MLP ended 2014 on a high note and was able to increase its market shares.
• Consolidation is now starting to gather momentum in Germany.
• MLP is optimally positioned for the new requirements and will benefit over-proportionally from a recovery in the market.
• MLP will continue its process of modernisation. The main objectives here include recruiting new consultants, implementation of the online strategy and further diversification of the revenue basis.
• With the acquisition of the DOMCURA group MLP is opening up a further strategically relevant business field – positive income contribution anticipated already in 2015
• The 2015 outlook underlines the commitment to delivering profitable growth despite difficult market environment and comprehensive future investments.

Contact

MLP Corporate Communications Alte Heerstr. 40 69168 Wiesloch Germany

• Jan Berg, Head of Corporate Communications
• Andreas Herzog, Head of Investor Relations and Financial Communications

Tel.: +49 (0) 6222 308 8320 Fax: +49 (0) 6222 308 1131

investorrelations@mlp.de www.mlp-ag.com

The MLP Group at a glance

The MLP Group is the partner for all financial matters – for private clients, companies and institutional investors. With our three brands, each of which enjoy a leading position in their respective markets, we offer a broad range of services:

• MLP Finanzdienstleistungen AG: The dialogue partner for all financial matters
• FERI AG: The investment expert for institutional investors and high net-worth individuals
• TPC GmbH: The specialist in occupational pension provision management for companies

The views and expectations of our clients always represent the starting point in each of these fields. Building on this, we then present our clients with suitable options in a comprehensible way so that they can make the right financial decisions themselves. For the implementation, we examine the offers of all relevant product providers in the market. Our product ratings are based on scientifically substantiated market and product analyses.

Q1 2015 – Total revenue rises to € 130.9 million

Total revenue Q1

[in € million]

Q1 2015 – Strong growth in wealth management

Revenue

[in € million]

	Q1 2015	Q1 2014*	∆ in %
Old-age provision	42.0	40.1	4.7
Wealth management	40.7	32.6	24.8
Health insurance	11.8	11.4	3.5
Non-life insurance	20.1	18.8	6.9
Loans and mortgages**	3.2	2.9	10.3
Other commissions and fees	2.5	1.3	92.3
Interest income	5.6	5.8	-3.4

* Previous year's figures adjusted; ** excluding MLP Hyp

Q1 2015 – Assets under Management reach € 29.0 billion

Assets under Management Premium sum: old-age provision

[in € billion] [in € million]

Q1 2015 – Core capital ratio: 14.3 percent

[in € million]
	31/03/2015	31/12/2014
Intangible assets	154.0	156.2
Financial investments	175.9	145.3	• Equity ratio: 23.3%
Cash and cash equivalents	52.5	49.1	• Core capital ratio: 14.3%
Other receivables and other assets	98.4	117.7
Shareholders' equity	378.6	376.8
Equity ratio	23.3%	23.2%
Other liabilities	91.3	117.8
Total	1,627.1	1,624.7

Acquisition of the DOMCURA Group

Business model

Underwriting agency for private and commercial coverage concepts

• Expertise in the fields of development, job processing, issuing of policies, contract management, collection and claims processing
• Coverage fields: private non-life insurance, personal insurance and commercial insurance
• Business partners: around 5.000 market participants (insurance brokers, pools, sales offices)

DOMCURA – Key transaction data

Purchase price	• The purchase price amounts to € 18 million, 66.6% paid directly (in cash) and 33.3% paid by means of a capital increase through contributions in kind
Purchase and transfer of 66.6% of shares	• 41.6% with economic effect as of January 1, 2015 • 25.0% with economic effect as of January 1, 2017 (share without participation in profits)
Increase in capital stock for a further 33.3% of shares	• 33.3% through a capital increase using authorised capital of MLP AG in exchange for contributions in kind • Share price: average closing price of the share during the 15 trading days prior to signing the contract • Lock-up: 6 months • Share capital rises slightly by 1.35%. As MLP anticipates a positive income contribution from DOMCURA already in 2015, shareholders will also benefit from the acquisition in the first year. • Through his shareholding, the founder of DOMCURA participates in the success of MLP in the long term.
Conditions for completion	• Consent of the German Federal Cartel Office
Valuation	• EBIT multiple: 10.6 x

Considerable potential – both in the DOMCURA business and in cooperation with MLP

* All figures according German Commercial Code (HGB)

EBIT* 2.0 1.0 1.0 1.7

• Average growth in revenue of 7.6 % p.a.
• Importance of non-life insurance is growing throughout the market – small brokers can no longer perform market screening on their own
• Expansion of the DOMCURA business model within the MLP Group planned
• Additional sales synergies in conjunction with existing MLP business

Significant advantages for DOMCURA business partners and MLP clients

MLP clients (private and corporate) DOMCURA business partners

• Client support processes, services and contract processing will be further improved
• Even more individual solutions possible by bundling several insurers in one coverage concept

• Price-performance ratio can be further improved

• Business model is secured in the long term and can be considerably expanded through the MLP Group

• DOMCURA benefits from the comprehensive market expertise of the MLP Group
• High continuity in the Executive Board ensured – also through the shareholding structure
• DOMCURA will remain a strong and reliable partner in the future