MLP SE — Investor Presentation 2016

Feb 23, 2017

Financial Results 2016

Frankfurt, February 23, 2017

• 1. Business Development 2016 Dr. Uwe Schroeder-Wildberg, CEO
• 1. Financials 2016 Reinhard Loose, CFO
• 1. Strategy, Outlook and Summary Dr. Uwe Schroeder-Wildberg, CEO
• 1. Questions & Answers

Key facts on business development in 2016

• In 2016, MLP expanded its market shares in key consulting segments, significantly accelerated its process for winning new customers and laid the foundations for cost reductions.
• Final quarter: Total revenue 3 % above the same period in the previous year. Oldage provision up 7 %.
• Financial year 2016: Key ratios significantly increased total revenue by 10 %, operating EBIT by 14 %.
• Dividend proposal: 8 cents per share distribution rate of 60 % within the announced corridor.

Market environment remains difficult

Sector-specific key indicators

Persons holding comprehensive private health insurance

8,60 9,00

million € billion in thousand 145.5 147.7 100 110 120 130 140 150 160 2015 2016 Premium sum new old-age provision business

Source: German Insurance Association (GDV e.V.)

Number of new old-age provision contracts

Source: German Insurance Association (GDV e.V.)

Source: Association of Private Health Insurers (PKV)

MLP is a pioneer in terms of new guarantee products

Market product mix for newly brokered policies

MLP product mix for newly brokered policies

New client groups developed

Number of private clients (families): 517,400 Number of corporate and institutional clients: 19,200

Significantly more stable revenue basis established

Commission income, excl. old-age provision

Revenue distribution FY 2016

Commission income in FY 2016: € 570.1 million (FY 2005: € 467.9 million)

€ million

• 1. Business Development 2016 Dr. Uwe Schroeder-Wildberg, CEO
• 1. Financials 2016 Reinhard Loose, CFO
• 1. Strategy, Outlook and Summary Dr. Uwe Schroeder-Wildberg, CEO
• 1. Questions & Answers

FY 2016: Total revenue increases to € 610.4 million

Total revenue FY

€ million

Gains primarily in the non-life insurance segment

Revenue

€ million

	2015	2016	 in %	Q4 2015	Q4 2016	 in %
Old-age provision	215.7	221.5	2.7	87.8	94.3	7.4
Wealth management	166.0	166.4	0.2	44.7	43.5	–2.7
Health insurance	45.9	45.8	-0.3	12.3	11.8	–4.6
Non-life insurance	54.9	105.6	92.5	18.1	20.0	10.5
Loans and mortgages*	16.2	15.4	-4.7	5.1	5.0	–0.9
Other commission and fees	15.6	15.4	-1.1	5.1	6.6	28.2
Interest income	21.4	20.5	-4.2	5.3	4.9	–6.7

* Excluding MLP Hyp

MLP grows and bucks the market trend

Old-age provision Health insurance

Premium sum of new business in the market (in € billion)

Premium sum of MLP new business (in € billion)

Number of persons holding comprehensive health insurance in the market (in million)

Number of persons at MLP holding comprehensive health insurance (in thousand)

Assets under management increase to € 31.5 billion

Assets under management, MLP Group

Each as at December 31

MLP wins 11 % more family clients

Gross number of new clients (families)

Client consultants

Operating EBIT at € 35.1 million

Income statement

€ million	Q4 2015	Q4 2016	2015	2016
Total revenue	186.5	191.7	554.3	610.4
Operating EBIT*	23.3	19.3	30.7	35.1
EBIT	23.3	8.2	30.7	19.7
Finance cost	-0.4	-0.4	-2.8	-0.9
EBT	22.9	7.7	28.0	18.7
Taxes	-6.8	-2.6	-8.2	-4.1
Net profit	16.1	5.1	19.8	14.7
EPS in euros (diluted/basic)	0.15	0.05	0.18	0.13

2016:

• Efficiency programme: one-off expenses of € 15.4 million (€ 11.1 million in Q4/2016)

*before one-off expenses

Core capital ratio at 14.2 %

Assets	Dec. 31, 2015	Dec. 31, 2016
Intangible assets	174.5	168.4
Financial assets	147.9	162.3
Receivables from clients in the banking business	542.7	626.5
Receivables from banks in the banking business	600.3	591.0
Other receivables and assets	112.5	122.8
Cash and cash equivalents	77.5	184.8

Equity ratio: 19.7 %

Return on equity: 3.8 %

Core capital ratio: 14.2 %

Liabilities and shareholders' equity

Shareholders' equity	385.8	383.6
Provisions	86.5	91.2
Liabilities due to clients in the banking business	1,102.6	1,271.1
Liabilities due to banks in the banking business	23.1	37.7
Other liabilities	140.2	146.9
Total	1,752.7	1,944.1

Net liquidity of around € 184 million

Executive Board proposes a dividend of 8 cents

Dividend per share

Dividend distribution rate

in %

*based on net profit, simulating an acquisition of DOMCURA on January 1, 2015.

• 1. Business Development 2016 Dr. Uwe Schroeder-Wildberg, CEO
• 1. Financials 2016 Reinhard Loose, CFO
• 1. Strategy, Outlook and Summary Dr. Uwe Schroeder-Wildberg, CEO
• 1. Questions & Answers

Strategic agenda 2017

Implementation
• Extension of the scope for action regarding future investments through altered group structure
• Strengthening of the university segment in the private client business through focus on core topics for young clients and consultants
• Further broadening of revenue basis: primarily through further expansion of wealth management and non-life insurance business • Continued implementation of digitalisation strategy: in particular extension of digital information and service offers
• MLP Group open to acquisitions in two areas:
• In the market segment of FERI and DOMCURA • In MLP's private client business
• Structural reduction of cost base initiated in 2016 – ongoing efficiency management programme Cost management

Making MLP more independent of short-term market influences and returning it to a significantly increased profit level

Scope for action significantly extended through new group structure

Effects on equity

Further strengthening of the business model Scope for investments and acquisitions

Banking activities with supervisory or regulatory relevance to be bundled at one company in the future

Current structure Intended structure as of 2018

Current scope of services for clients will be maintained Better opportunities for strategic collaborations

Private client business – strengthening the university segment

Number of academics in active employment

million

Sources: Germany's Federal Employment Agency (2016) and Vogler-Ludwig et al. (2016)

• Increasing potential for MLP in the university segment
• Measures of the last few years are having an impact, particularly the introduction of a training allowance for new consultants
• Sharper focus, among other things by introducing a dedicated divisional board member for the university segment
• Objectives: To further increase presence and gain new clients and consultants more quickly

Sharper focus on university segment

MLP private client business

A = Focus: Winning new clients B = Focus: Serving existing clients

Strategic agenda 2017

focus	Strategic	Implementation
1		• Extension of the scope for action regarding future investments through altered group structure
	Organic growth	• Strengthening of the university segment in the private client business through focus on core topics for young clients and consultants
		• Further broadening of revenue basis: primarily through further expansion of wealth management and non-life insurance business • Continued implementation of digitalisation strategy: in particular extension of digital information and service offers
2	Inorganic growth	• MLP Group open to acquisitions in two areas: • In the market segment of FERI and DOMCURA • In MLP private client business
3	Continued Cost management	• Structural reduction of cost base initiated in 2016 – ongoing efficiency management programme

Making MLP more independent of short-term market influences and returning it to a significantly increased profit level

Even more balanced revenue basis in the medium term

Development of revenue distribution

Online policy sales successfully launched for basic products

New client portal enters its first extension phase in April

Strategic agenda 2017

focus	Strategic	Implementation
1	Organic growth	• Extension of the scope for action regarding future investments through altered group structure • Strengthening of the university segment in the private client business through focus on core topics for young clients and
		consultants • Further broadening of revenue basis: primarily through further expansion of wealth management and non-life insurance business • Further implementation of digitalisation strategy: in particular extension of digital information and service offers
2	Inorganic growth	• MLP Group open to acquisitions in two areas: • In the market segment of FERI and DOMCURA • In MLP private client business
3	Continued Cost management	• Structural reduction of cost base initiated in 2016 – ongoing efficiency management programme

Making MLP more independent of short-term market influences and returning it to a significantly increased profit level

Strategic agenda 2017

Strategic focus	Implementation
1 Organic growth	• Extension of the scope for action regarding future investments through altered group structure • Strengthening of the university segment in the private client business through focus on core topics for young clients and consultants
	• Further broadening of revenue basis: primarily through further expansion of wealth management and non-life insurance business • Further implementation of digitalisation strategy: in particular extension of digital information and service offers
2 Inorganic growth	• MLP Group open to acquisitions in two areas: • In the market segment of FERI and DOMCURA • In MLP private client business
3 Continued Cost management	• Structural reduction of cost base initiated in 2016 – ongoing efficiency management programme

Making MLP more independent of short-term market influences and returning it to a significantly increased profit level

Cost management bears fruit

Administrative expenses

Outlook: Operating EBIT of at least € 45 million anticipated

Forecast development of administrative expenses

Qualitative assessment of the development of sales revenues

Revenue from old-age provision	0
Revenue from health insurance	+
Revenue from wealth management	0
Revenue from non-life insurance	+

very positive: ++, positive: +, neutral: 0, negative: -, very negative: --

MLP anticipates EBIT of at least € 36 million in 2017 (operating EBIT: at least € 45 million)

• MLP increased important key performance indicators in 2016. In light of market conditions that remained difficult, this development can be seen as satisfactory.
• With the change of the group structure and further strengthening of the university segment, MLP is pressing ahead in 2017.
• Despite the one-off expenses associated with the change of the group structure, MLP anticipates EBIT of at least € 36 million for 2017.

Financial Results 2016

Frankfurt, February 23, 2017

Contact

Jan Berg Head of Corporate University / Corporate Communications

Frank Heinemann Head of External Communications

Andreas Herzog

Head of Investor Relations and Financial Communications

MLP AG Alte Heerstr. 40 69168 Wiesloch Germany

Tel.: +49 (0) 6222 • 308 • 8320 Fax: +49 (0) 6222 • 308 • 1131 investorrelations@mlp.de

www.mlp-ag.de