MLP SE — Investor Presentation 2018

Apr 12, 2018

The MLP Group – The partner for all financial matters

Management Roadshow April 2018

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

MLP Finanzberatung SE	MLP Banking AG	FERI AG	DOMCURA AG	TPC GmbH
The Partner for all financial matters		The investment expert for institutional investors and high net-worth individuals	The underwriting agency, focusing on private and commercial non-life insurance	The specialist in occupational pension provision management
• Old-Age provision • Non-Life insurance • Health insurance • Real Estate	All fields of financial consulting • Wealth Management. • Banking	• Investment Research • Investment Management • Investment Consulting	• € 360 million joint premium volume • Improved market position • Easier and better processes • Extended value chain	• Biggest German broker • Small solutions & complex balance sheet issues • Member International Benefits Network
• ~1,900 consultants • ~150 branch offices • ~1,050 employees	• ~1,900 consultants • ~150 employees	• ~220 employees • International locations: Vienna, Zurich, Luxembourg	• ~250 employees • ~5,000 partners (insurance brokers, pools, sales offices)	• Client consulting together with MLP client consultants

MLP Group – An Overview

• Around 529,100 private clients (families) in the mass affluent segment of the market target groups: graduates (i.e. physicians, Clients solicitors, engineers and economists) • Around 19,800 corporate and institutional clients					*as of December 31, 2017
	Brokered premium sum for new business totalled € 3.4 billion in 2017. Old-age provision Occupational pension provision accounted for around 15% of this figure.						Share of revenue '17
s a e							35%
ar s s e n	Wealth Management	€ 33.9 billion in assets under management as at December 31, 2017 in business with mass affluent clients, HNWI and institutional investors.	32%
si u b n ai	Non-life insurance	Business field expanded by acquisition of DOMCURA Group in 2015. More that € 360 million premium volume within the MLP Group.	19%
M	Health insurance	Private health insurance, supplementary private health insurance, long-term care, occupational health insurance, statutory health insurance.					8%
Top Financials FY 2017		Total revenue: € 628.2 mil. Operating EBIT*: € 46.7 mil. EBIT: € 37.6 mil. Net profit: € 27.8 mil.	Equity Ratio: Core Capital Ratio: 20.0% Consultants:	18.7% 1,900	Dividend per share: Return on Equity: Employees:	€ 7.3% 1,686	0.20 (proposed) *before one-off expenses
	MLP Share	Shares outstanding: 109,334,686 Free Float: 49.81% (Definition on the German stock exchange) Average daily trading volume: 167,373			(Xetra, 12-month average as at end of February 2018)

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 e based on dividend proposal		11.8% 4.0% 2010 2011	6.4% 3.1% 2012 2013	4.6% 3.3% 2014 2015	Pay-out ratio: 64% 3.6%e 1.9%* 2016 2017
Shareholder structure	Dr. h. c. Manfred Lautenschläger HDI Barmenia Allianz SE Angelika Lautenschläger Freefloat (Def. Deutsche Börse) [FMR LLC: 2.95%, Internationale Kapitalanlagegesellschaft	23.22% 9.36% 5.49% 6.18% 5.94% 49.81%		mbH: 5.03%, Schroders PLC: 2.99%]	Freefloat		Barmenia Allianz SE HDI Pensionskasse	Dr. h. c. Manfred Lautenschläger Angelika Lautenschläger
Research coverage	Hauck & Aufhäuser Equinet/ESN Independent Research Bankhaus Lampe	Buy Buy Hold Hold	PT 7.40 PT 7.50 PT 5.70 PT 5.30	Ø daily trading volume	190.000 140.000 90.000 40.000	N D J F 16 16 17 17	M A M J J A 17 17 17 17 17 17	S O N D J F 17 17 17 17 18 18

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 MLP's private client business • In the DOMCURA market segment • In the FERI market segment	• 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

Further broadening of revenue basis

Strengthening of the university segment displaying initial successes

Accelerated implementation of digitalisation strategy

Broader leeway for the Group

Increased free equity capital Realigned Group structure/banking services

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

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: Growth across all consulting areas, excluding old-age provision

Revenue

In € million

	2016	2017	 in %	Q4 2016	Q4 2017	 in %
Old-age provision	221.5	208.1	–6.0	94.3	86.1	–8.7
Wealth management	166.4	190.6	14.5	43.5	50.8	16.8
Health insurance	45.8	45.9	0.2	11.8	11.7	–0.8
Non-life insurance	105.6	109.9	4.0	20.0	19.1	–4.5
Loans and mortgages*	15.4	17.0	10.4	5.0	5.8	16.0
Other commission and fees	15.4	18.4	19.5	6.6	4.4	–33.3
Interest income	20.5	18.9	–7.8	4.9	4.5	–8.2

* Excluding MLP Hyp

Clients focusing on new guarantees and occupational pension provision

Assets under management increase to € 33.9 billion

Assets under management, MLP Group

Number of family clients around 530,000

Family clients Client consultants

Operating EBIT increases significantly to € 46.7 million

Income statement

In € million
	2016	2017	Q4 2016	Q4 2017
Total revenue	610.4	628.2	191.7	187.5
Operating EBIT*	35.1	46.7	19.3	25.3
EBIT	19.7	37.6	8.2	23.0
Finance cost	-0.9	-1.2	-0.4	-0.5
EBT	18.7	36.4	7.7	22.5
Taxes	-4.1	-8.6	-2.6	-5.8
Net profit	14.7	27.8	5.1	16.7
EPS in € (diluted/basic)	0.13	0.25	0.05	0.15

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

Significant increase in equity

In € million

Core capital ratio at 20 percent

In € million

Assets	Dec. 31, 2016	Dec. 31, 2017
Intangible assets	168.4	161.8
Financial assets	162.3	158.5
Receivables from clients in the banking business	626.5	702.0
Receivables from banks in the banking business	591.0	634.2
Other receivables and assets	122.8	125.7
Cash and cash equivalents	184.8	301.0

Equity ratio: 18.7 %

Return on equity: 7.3 %

Core capital ratio: 20.0 %

Liabilities and shareholders' equity

Shareholders' equity	383.6	404.9
Provisions	91.2	88.7
Liabilities due to clients in the banking business	1,271.1	1,439.8
Liabilities due to banks in the banking business	37.7	61.4
Other liabilities	146.9	154.9
Total	1,944.1	2,169.5

Net liquidity of around € 215 million

As of December 31, 2017

Executive Board proposes a dividend of 20 cents per share

Dividend per share

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	0

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 – EBIT is likely to increase significantly, as there are no special expenses scheduled for 2018

• Targets achieved in 2017 MLP is benefiting from the strategic further development of the last few years.
• Transformation of MLP to be continued in 2018. In focus: further digitalisation, further diversification of the revenue basis, as well as strengthening the university segment.
• Despite comprehensive investments for the future: Our goal is to confirm the earnings base achieved in 2017.

The MLP Group

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

FY 2017: Income Statement

All figures in $\epsilon$ '000	Q4 2017	Q4 2016	2017	2016
Revenue	182,403	186,101	608,743	590,559
Other revenue	5,055	5,610	19,424	19,810
Total revenue	187,458	191,711	628,167	610,369
Commission expenses	$-90,961$	$-96,882$	$-309,344$	-298,505
Interest expenses	$-160$	$-540$	$-1,055$	$-1,711$
Loan loss provisions	505	248	$-511$	$-1,619$
Personnel expenses	$-34,369$	$-32.023$	$-123,245$	$-121,847$
Depreciation and amortisation	$-3,939$	$-13,038$	$-15,293$	$-23,962$
Other operating expenses	$-36,295$	$-41,937$	$-143,607$	$-145,137$
Earnings from shares accounted for using the equity method	719	618	2,487	2,106
Earnings before interest and taxes (EBIT)	22,958	8,157	37,600	19,694
Other interest and similar income	51	275	209	906
Other interest and similar expenses	$-553$	$-712$	$-1,433$	$-1,851$
Finance cost	$-502$	-437	$-1,223$	$-946$
Earnings before taxes (EBT)	22,456	7,720	36,377	18,748
Income taxes	$-5,761$	$-2,576$	$-8,582$	$-4,052$
Net profit	16,694	5,144	27,796	14,696
Of which attributable to owners of the parent company	16,694	5,144	27,796	14,696
Earnings per share in $\epsilon$	0.15	0.05		0.13
basic			0,25
diluted	0.15	0.05	0,25	0.13
Number of shares	109,334,686	109,334,686	109,334,686	109,334,686

FY 2017: Consolidated Balance Sheet

All figures in $\epsilon$ '000	Dec 31, 2017	Dec 31, 2016
Intangible assets	161,838	168,419
Property, plant and equipment	61,861	63,365
Shares accounted for using the equity method	4,132	3,751
Deferred tax assets	8,035	9,063
Receivables from clients from the banking business	701,975	626,479
Receivables from banks from the banking business	634,150	590,972
Financial investments	158,457	162,286
Tax refund claims	12,346	12,115
Other receivables and other assets	125,741	122,776
Cash and cash equivalents	301,013	184,829
Total	2,169,547	1,944,055

All figures in $\epsilon$ '000	Dec 31, 2017	Dec 31, 2016
Equity	404,935	383,585
Provisions	88,737	91,225
Deferred tax liabilities	9,531	9,898
Liabilities towards clients from the banking business	1,439,805	1,271,070
Liabilities towards banks from the banking business	61,383	37,720
Tax liabilities	10,243	3,646
Other liabilities	154,913	146,911
Total	2,169,547	1,944,055

FY 2017: Segment Reporting

	Financial Services		FERI		DOMCURA		Holding		Consolidation		Total
All figures in € '000	2017	2016	2017	2016	2017	2016	2017	2016	2017	2016	2017	2016
Revenue	400,737	400,446	139,710	123,583	73,273	70,664			$-4,976$	$-4,134$	608,743	590,559
Other revenue	14,373	10,313	4,283	5,081	4,642	3,212	9,611	13,694	$-13,485$	$-12,490$	19,424	19,810
Total revenue	415,109	410,759	143,993	128,664	77.915	73,876	9,611	13,694	$-18,461$	$-16,624$	628,167	610,369
Commission expenses	$-184,213$	$-183,578$	$-81,754$	$-72,072$	$-48,323$	$-46,574$			4,946	3,719	$-309, 344$	$-298,505$
Interest expenses	$-1,055$	$-1.719$								8	$-1.055$	$-1,711$
Loan loss provisions	$-517$	$-839$	$-34$	$-768$	40	2		$-13$			$-511$	$-1,619$
Personnel expenses	$-74,630$	$-76,015$	$-30,507$	$-28,114$	$-14,337$	$-14, 114$	$-3,771$	$-3,604$			$-123,245$	$-121,847$
Depreciation/amortisation and impairment	$-11,164$	$-19,103$	$-1,170$	$-1,545$	$-1,293$	$-1,370$	$-1,666$	$-1,944$		$\overline{\phantom{a}}$	$-15,293$	$-23,962$
Other operating expenses	$-125,654$	$-126,766$	$-10,614$	$-11,848$	$-8,277$	$-8,804$	$-12,550$	$-10,534$	13,487	12,815	$-143,607$	$-145, 137$
Earnings from shares accounted for using the equity method	2,487	2,106				$\overline{\phantom{a}}$		$\overline{\phantom{a}}$		$\blacksquare$	2,487	2,106
Earnings before interest and tax (EBIT)	20,365	4,845	19,914	14,316	5,724	3,015	$-8,376$	$-2,400$	$-27$	-83	37,600	19,694
Other interest and similar income	122	362	40	361	27	44	45	172	$-24$	-33	209	906
Other interest and similar expenses	$-779$	$-686$	$-246$	-480	$-38$	$-21$	$-461$	-777	92	113	$-1.433$	$-1,851$
Finance cost	$-657$	$-324$	$-206$	$-119$	$-11$	23	$-417$	$-605$	68	79	$-1,223$	$-946$
Earnings before tax (EBT)	19,708	4,521	19,708	14,198	5,713	3,039	$-8,793$	$-3,005$	41		36,377	18,748
Income taxes											$-8,582$	$-4,052$
Net profit (total)											27 790	14,696

FY 2017: Segment Reporting (new)

	Financial Consulting		Banking		FERI		DOMCURA		Holding		Consolidation		Total
All figures in € '000	2017	2016			2017	2016	2017	2016	2017	2016	2017	2016	2017	2016
Revenue	126,848		278,317		139,710		73,273				$-9,405$		608,743
Other revenue	6,394		11,639		4,283		4,642		9,611		$-17,146$		19,424
Total revenue	133,242		289,957		143,993		77,915		9,611		$-26,551$		628,167
Commission expenses	$-58,510$		$-128,959$		$-81,754$		-48,323				8,202		$-309,344$
Interest expenses			$-1,055$										$-1,055$
Loan loss provisions	102		$-619$		$-34$		40						$-511$
Personnel expenses	$-21,467$		$-53,163$		$-30,507$		$-14,337$		$-3,771$				$-123,245$
Depreciation/amortisation and impairment	$-3,702$		$-7,461$		$-1,170$		$-1,293$		$-1,666$				$-15,293$
Other operating expenses	$-27,243$		$-103,252$		$-10,614$		$-8,277$		$-12,550$		18,328		$-143,607$
Earnings from shares accounted for using the equity method	2,487												2,487
Earnings before interest and tax (EBIT)	24,910		$-4,553$		19,914		5,724		$-8,376$		$-20$		37,600
Other interest and similar income	20		102		40		27		45		$-24$		209
Other interest and similar expenses	$-182$		$-597$		$-246$		$-38$		$-461$		92		$-1,433$
Finance cost	$-163$		$-495$		$-206$		$-11$		$-417$		68		$-1,223$
Earnings before tax (EBT)	24,747		$-5,047$		19,708		5,713		$-8,793$		48		36,377
Income taxes													$-8,582$
Net profit (total)													27,796

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