MLP SE — Investor Presentation 2018

Oct 1, 2018

The MLP Group – The partner for all financial matters

Company presentation

The MLP Group

• 1. MLP at a glance
• 1. Strategy
• 1. Key Financials & Outlook
• 1. Appendix

The MLP Group at a glance

The MLP Group The Partner for all financial matters Private Clients – Corporate Clients – Institutional Investors
DOMCURA AG	MLP Finanzberatung SE	MLP Banking AG	FERI AG	TPC GmbH
The underwriting agency, focusing on private and commercial non-life insurance		The Partner for all financial matters	The investment expert for institutional investors and high net-worth individuals	The specialist in occupational pension provision management
• Improved market position		All fields of financial consulting	• Investment Research	• Biggest German broker
• Easier and better processes • Extended value chain	• Old-Age • Health provision insurance • Non-Life • Real Estate	• Wealth Management. • Banking	• Investment Management • Investment Consulting	• Small solutions & complex balance sheet issues • Member International Benefits Network
• €	370 million joint premium volume	35.4 billion joint AuM
• ~250 employees • ~5,000 partners (insurance brokers, pools, sales offices)	• ~1,900 consultants • ~150 branch offices • ~1,050 employees	• ~1,900 consultants • ~150 employees	• ~220 employees • International locations: Vienna, Zurich, Luxembourg	• Client consulting together with MLP client consultants

MLP Group – An overview

Attractive dividend policy & stable shareholder structure

Dividend policy	Pay-out ratio: 50% - 70% of net profit Profit retention required for: - Acquisitions - Capital expenditure - Capital management (Basel III)		Return on dividend: * influenced by one off expenses		4.0% 2010	11.8% 2011	6.4% 2012	3.1% 2013	4.6% 2014	3.3% 2015	1.9%* 2016	Pay-out ratio: 64% 3.6% 2017
Shareholder structure (Voting rights notification)	Lautenschläger Family HDI Barmenia Allianz SE Freefloat (Def. Deutsche Börse) 1 Pooling agreement [FMR LLC: 2.95%, Internationale Kapitalanlagegesellschaft	29.16%1 9.36% 5.49% 6.18% 49.81%			Lautenschläger Family Barmenia Allianz SE HDI Pensionskasse Freefloat mbH: 5.03%, Schroders PLC: 2.99%]				49,81%		29,16% 5,49% 6,18% 9,36%
Research coverage	Hauck & Aufhäuser Equinet/ESN Independent Research Bankhaus Lampe	Buy Buy Hold Buy	PT 7.40 PT 7.50 PT 5.70 PT 6.00	Ø daily trading volume		200.000 150.000 100.000 50.000 0	M A 17 17	M J J 17 17 17	A S O 17 17 17	N D J F 17 17 18 18	M A M 18 18 18	J J A 18 18 18

Market environment – Fundamental changes taking place

Demographics

• Rising life expectancy and low birth rate ageing society
• Increasing pressure on state social welfare systems

Regulation

• Since 2004 and especially since 2008 intensive regulation
• impacting product level, training of consultants, documentation and transparency

Client behaviour

• Still fundamental scepticism towards the financial industry
• Quick and inexpensive information possibilities

Digitalisation

• Need for smart front-end solutions
• Smart and digital internal processes necessary

Regulation – significant increase in consolidation within the market due to Life Insurance Reform Act (LVRG)

Shrinking Number of insurance intermediaries in Germany

Trend is ongoing and will strengthen – MLP to play an active role in consolidation process

Effects of the Life Insurance Reform Act / Evaluation 2018 (LVRG)

• Quality of consultancy and portfolio is even more important
• Sale organisations with a high cancellation rate lose trail commissions
• Major challenges for pyramid sales organisations
• Evaluation of the LVRG in 2018:
• Commission-cap still in discussion. Politics actually develop implementation proposals
• MLP considers restriction on a general basis as not expedient
• In case of a restriction high quality consulting still has to be rewarded – as already proposed by the BaFin

The MLP Group

• 1. MLP at a glance
• 1. Strategy
• 1. Key Financials & Outlook
• 1. Appendix

Successful strategic diversification over the last years

Occupational pension provision	Clear business model	Wealth management	Real estate	Expansion of non-life insurance
2004 Foundation of Occupational Pension Provision division 2008 Acquisition of TPC	2005 Sale of own insurance subsidiaries	2006 MLP buys shares in FERI AG 2011 MLP acquires all shares in FERI as planned	2011 Start of real estate portfolio 2014 Expansion of real estate portfolio	2015 Acquisition of DOMCURA Group • Underwriting agency • Further strategically relevant business segment tapped • Significant potential with existing business

Successful diversification beyond the old-age provision – FY 2017: Constitution of commission income (in € million)

Strategic agenda 2018

Strategic focus	1 Organic growth	2 Inorganic growth	3 Continued cost management
Implementation	• Strengthening of the university segment in the private client business: through focus on recruiting young consultants and acquiring clients • Further broadening of revenue basis: primarily through further expansion of wealth management and non-life insurance business • Accelerated implementation of digitalisation strategy: in particular extension of digital information and service offers	The MLP group continues to target acquisitions and is open for opportunities in three areas: • In the FERI market segment • In the DOMCURA market segment • In MLP's private client business	• Structural reduction of the cost base continued in 2017 – ongoing efficiency management • Simultaneous investment in future projects

Making MLP less susceptible to short-term market influences and building on profit level already achieved

Private client business – strengthening the university segment

Number of academics in active employment

• 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

Strengthening of the university segment displaying initial successes

Further broadening of revenue basis in 2018

Accelerated implementation of digitalisation strategy

MLP cooperates with start-ups and fintechs

Digital solutions supporting clients and client consultants

Smart client application

Broader leeway for the Group

Realigned Group structure/banking services

Increased free equity capital

The MLP Group

• 1. MLP at a glance
• 1. Strategy
• 1. Key Financials & Outlook
• 1. Appendix

FY 2017: Total revenue reaches highest level since outbreak of the financial crisis

Total revenue

In € million

* Previous year's values adjusted

FY 2017: Clients focusing on new guarantees and occupational pension provision

FY 2017: Operating EBIT increases significantly to € 46.7 million

Income statement

In € million
	2016	2017
Total revenue	610.4	628.2
Operating EBIT*
EBIT	19.7	37.6
Finance cost	-0.9	-1.2
EBT	18.7	36.4
Taxes	-4.1	-8.6
Net profit	14.7	27.8
EPS in € (diluted/basic)	0.13	0.25

35.1 46.7 2017: One-off expenses of € 9.1 million (€ 2.3 million in Q4/2017) for further optimisation of the Group structure (separation of banking and brokerage activities). One-off expenses of € 15.4 million in the year before

(Q4/2016: € 11.1 million).

*Before one-off expenses

H1 2018: Total revenue up 3 percent over previous year

Revenue

In € million

H1 2018: Total revenue constantly expanded

Total revenue Q2 and H1

H1 2018: Broadening of the revenue base successfully continued

Commission income in the first half-year (all fields, excluding old-age provision)

H1 2018: Assets under Management reach record level

AuM MLP Group

H1 2018: EBIT at € 12.1 Mio.

Income Statement

*before one-off expenses

H1 2018: Stable balance sheet

In € million

Assets	Dec 31, 2017	June 30, 2018
Intangible assets	161.8	158.7
Financial assets	158.5	149.9
Receivables from clients in the banking business	702.0	722.4
Receivables from banks in the banking business	634.2	676.6
Other receivables and assets	125.7	137.8
Cash and cahs equivalents	301.0	331.6

Equity ratio: 17.7 %

Core capital ratio: 17.4 %

Eligible own funds: € 266 million

Liabilities and shareholders' equity

Shareholders' equity	404.9	400.0
Provisions	88.7	79.5
Liabilities due to clients in the banking business	1,439.8	1,554.8
Liabilities due to banks in the banking business	61.4	73.4
Other liabilities	154.9	138.5
Total	2,169.5	2,260.1

Initial adoption of IFRS 15

• (consequences)
• Increase in shareholders' equity of 11.9 € million (at the same time opposing effect by IFRS 9 of € -4.0 million)
• No more revenue resulting from the affected trail commissions in the oldage provision segment

H1 2018: Net liquidity of around € 209 million

H1 2018: Number of family clients increases to 535,100

Family clients Client consultants

Outlook for the financial year 2018

Qualitative assessment of revenue development

Revenue	2018
Old-age provision	+
Wealth management	0
Health insurance	0
Non-life insurance	+
Loans and mortgages	0
Real estate brokerage	++

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

MLP is anticipating EBIT in 2018 to remain at around the level of operating EBIT recorded in 2017 – as there are no one-off exceptional costs for 2018 EBIT will increase significantly

• Targets achieved in 2017 MLP is benefiting from the strategic further development of the last few years.
• Transformation of MLP continues in 2018. In focus: further digitalisation, further diversification of the revenue basis, as well as strengthening the university segment.
• MLP laid a solid foundation in the first six month
• Strategic initiatives are running as scheduled and showing further successes
• Decisive in the business model remains the second half of the year, especially the final quarter
• Outlook confirmed: Despite substantial investments in the future, MLP expects EBIT at the level of the previous year's operating EBIT of € 46.7 million

The MLP Group

• 1. MLP at a glance
• 1. Strategy
• 1. Key Financials & Outlook
• 1. Appendix

Realigned Group structure: new segments

Previous structure (segments*)			Current structure	(segments*)
	Finanzdienst leistungen	FERI	DOMCURA	Financial Consulting	Banking	FERI	DOMCURA
Old-age provision	x			x
Wealth management	x	x			x	x
Non-life insurance	x		x	x			x
Health insurance	x			x
Loans and mortgages	x			x
Real estate brokerage	x			x

*Further segment, but without active operations: Holding

Sharper focus on university segment

MLP sales organisation

N = Focus: Winning new clients E = Focus: Serving existing clients

DOMCURA: Underwriting agency selects the appropriate insurer from the marketplace

FY 2017: dividend of 20 cents per share

Dividend per share

FY 2017: Significant increase in equity

In € million