Quarterly Report • May 7, 2008
Quarterly Report
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| All figures in € m | 1st Quarter 2008 | 1st Quarter 2007 | Change in % |
|---|---|---|---|
| continuing opeerations | |||
| Total revenues | 158.2 | 145.61 | 8.7% |
| Revenues | 151.0 | 137.11 | 10.2% |
| Other revenues | 7.2 | 8.61 | –15.9% |
| Earnings before interest and tax (EBIT) | 23.2 | 19.81 | 17.6% |
| EBIT margin (%) | 14.7 % | 13.6 % | 8.0% |
| Earnings from continuing operations | 6.8 | 10.21 | –33.4% |
| Earnings per share (diluted) in € | 0.07 | 0.101 | –30.0% |
| mlp-group | |||
| Net profit (total) | 6.7 | 8.61 | –21.6% |
| Earnings per share (diluted) in € | 0.07 | 0.091 | –28.6% |
| Capital expenditure | 3.0 | 2.8 | 7.1% |
| Shareholders' equity | 334.5 | 339.72 | –1.5% |
| Equity ratio (%) | 24.3 % | 23.9 %2 | 1.7% |
| Balance sheet total | 1,377.8 | 1,424.22 | –3.3% |
| Clients3 | 724,000 | 721,0002 | 0.4% |
| Consultants3 | 2,602 | 2,6132 | –0.4% |
| Branch offices3 | 258 | 2622 | –1.5% |
| Employees3 | 2,028 | 1,822 | 11.3% |
| arranged new business | |||
| Old-age provisions (premium sum in € billion) | 1.9 | 0.9 | 111.1% |
| Health insurance (annual premium) | 11.9 | 16.2 | –26.5% |
| Loans | 272.0 | 306.0 | –11.1% |
| Funds under management (in € billion) | 10.9 | 11.42 | –4.4% |
1 Previous year's values adjusted. The adjustments are disclosed under note 3.
2 As at December 31, 2007.
3 Continuing operations.
MLP generates over 98% of its total revenue within its core market, Germany, and is thus primarily influenced by the business development in this area.
Despite the crisis in the financial sector triggered by the difficulties in the US property market as well as a generally weakening worldwide economy, the economic upswing in Germany in 2oo7 remained intact during the first quarter of the current financial year. This was due particularly to the dynamic development in industry and in the main building sector, from which the labour market also benefited. The number of people in employment in February rose more strongly than the average of the previous six months and increased within the year by a total of 532,ooo. From February to March, the official unemployment figure fell by 11o,ooo to 3.5o7 million people.
Contrary to the expectations of economic experts, private consumption in the first quarter failed to gather momentum. In this respect, and according to provisional figures, the retail sales volume in February of this year fell again by 1.6%. In particular, the significantly higher prices for food and energy led to a reduction in consumers' buying power. Consumer prices in February and March rose by 2.8% and 3.1% respectively.
In view of the opposing trends – economic growth and a fall in unemployment on the one hand, stacked against a reduction in buying power on the other – the macroeconomic development in Germany had neither a positive stimulus nor a negative effect on the business development of MLP in the first quarter of 2oo8.
The development in these two market segments during the first quarter of 2oo8 was essentially influenced by adjustment processes due to the changes in the German Insurance Contract Law that came into effect on 1st January 2oo8. The legislator expects these changes to lead to improved consumer protection through greater transparency and competition among the insurance companies. The Insurance Contract Law reform places higher requirements on insurance companies with respect to their information obligations towards clients. Furthermore, the terms of cancellation as well as the profit sharing regulations for life insurance policies have also been redefined. Due to the far-reaching effects of these changes on the processes and structures of insurance companies as well as an associated possible change in client behaviour, business development in the old-age pension provision and health insurance market segments during the first quarter was somewhat restrained.
Since the beginning of 2oo8, the main topic within the wealth management area has been the planned introduction of the flat-rate withholding tax on capital gains, scheduled to come into effect on 1st January 2oo9. In view of this new legislation, experts expect an extensive redeployment of private households' assets during the current financial year. In the first quarter of the year, private investors exhibited a heightened awareness of this topic which, particularly towardsthe end of the quarter, led to initial diverted investmentsinto withholding tax-optimised wealth management concepts. In this respect, for instance, the Federal Association of Investment and Asset Management (BVI) reported that in the first quarter of 2oo8, a total of € 11.6 billion had flowed into German mutual investment funds. In addition to money market funds, mixed funds and fund of fund products in particular also experienced considerable inflows of capital.
The changes in the German Insurance Contract Law (VVG) that came into force on 1st January 2oo8 also have indirect effects on the competition within the market for the sale of financial services in Germany. Particularly the greater information and transparency obligations with respect to life insurance and healthcare insurance products lead to higher consultancy requirements for clients. Together with the EU Insurance Mediation Directive and the Markets in Financial Instruments Directive (MiFID) which were already incorporated into German law in 2oo7, the changes to the Insurance Contract Law raise the regulatory requirements and thereby also the market entry barriers for new competitors. In addition, they will also promote the professionalism and specialisation of the market participants. Industry experts expect such aspects to lead to a process of consolidation and concentration among the market providers during the coming years, although clear signs of this trend were not yet apparent in the first quarter of 2oo8.
MLP has achieved a dynamic start to the year, posting significant increases in revenues and profit from operations. Total revenues rose by nine percent to € 158.2 million (Q1 2oo7: € 145.6 million). Coupled with a margin of 14.7% (13.6%), earnings before interest and taxes (EBIT) climbed to € 23.2 million (€ 19.8 million) – equating to an increase of eighteen percent. MLP has seamlessly followed on from itssuccessful Q4 2oo7 performance and has grown considerably, despite the quarter having been influenced by extensive training measures.
Following the completed merger of MLP Finanzdienstleistungen Aktiengesellschaft with MLP Bank AG, MLP is now reporting the profit and loss account in a new structure for the first time, in which revenues consists of revenues from commissions and fees and interest income. In the first quarter, MLP grew revenues from commissions and fees by 9.1% to € 141.o million (€ 129.3 million). Old-age pension provision was the largest contributor to this achievement, rising by 44% to € 89.2 million (€ 61.8 million). Interest income amounted to € 1o.o million and was likewise significantly above the previous year's figure (€ 7.7 million).
The commission expenses of € 56.6 million (€ 56.1 million) remained around the level of the previous year.
The interest expenses rose almost proportionally to the interest income. This resulted in an increase in the interest result from € 3.8 million to € 4.8 million.
Personnel expenses rose significantly, increasing by 22.2 % to € 28.7 million due to salary rises, compensatory payments and additional personnel in the wealth management area.
Operating expenses rose slightly from € 37.8 million to € 39.6 million, mainly attributable to an increase in IT costs and necessary training measures in connection with changes to the statutory framework conditions.
In Q4 2oo7, our subsidiary MLP Hyp, through which we handle the joint residential mortgage business together with Interhyp AG, commenced operations. In the first quarter of 2oo8, this company generated earnings of around € o.1 million (earnings from companies accounted for using the equity method).
At € 6.8 million, net profit from continuing operations remained below the corresponding figure in the previous year (€ 1o.2 million). This was attributable to the dividend distribution to the minority shareholders of Feri Finance AG which reduced the financial result by around € 7.8 million as well as causing a one-off increase in the tax ratio.
The balance sheet total in the first quarter of 2oo8 stood at € 1.38 billion and was thus 3.3% below the value at 31st December 2oo7.
On the assets side of the balance sheet, the intangible assets rose by 8.2% to € 199.8 million, largely due to additional company values from acquisitions.
The financial investments and cash increased in total from € 89.7 million to € 16o.7 million. This is mainly attributable to the profit transfer of our subsidiary MLP Finanzdienstleistungen AG for the financial year 2oo7.
The other receivables and other assets fell season-typically by 3o.9% to € 111.9 million.
On the liabilities side of the balance sheet, the equity capital remained almost unchanged at € 334.5 million. The equity ratio was therefore also unchanged at around 24%.
Our deposit business has not changed significantly compared to the 2oo7 year-end. The liabilities towards customers and banks remain at around € 746.8 million (€ 752.3 million). The investment of clients' monies is shown on the assets side of the balance sheet in the liabilities towards banks and customers. These have likewise not significantly changed - with the exception of the adjusted entry of the corresponding funds from receivables from banks into cash, caused by the profit transfer of our subsidiary MLP Finanzdienstleistungen AG for the financial year 2oo7.
The other liabilities fell in accordance with our usual seasonal business cycle from € 278.5 million to € 238.6 million.
The cash flow from operating activities in the continuing operations improved significantly, rising from € 41.o million to € 89.9 million. In comparison with the first quarter of 2oo7, this is mainly attributable to the different timing of profit transferrals. Through the investment of monies and as a result of acquisitions, cash flow from investing activities fell from € –2.5 million to € –15.2 million. The main influencing factor on the cash flow from the financing activities of the continuing operations during the period under review was the continued share buyback programme. This led to a fall in the cash flow from financing activities from € –o.2 million to € –11.5 million. Cash and cash equivalents at the end of the first quarter amounted to € 1oo.4 million (€ 12o.2 million).
In the first three months of the current financial year we invested around € 3.o million (€ 2.8 million), mainly in the improvement of IT support for client consultation as well as other relevant processes for client care.
As previously forecasted, the annual premiums in private healthcare insurance declined to € 11.9 million (€ 16.2 million) due to the new regulations of the healthcare reform. The loans and mortgages volume amounted to € 272 million (€ 3o6 million). Despite the very challenging developments in the capital markets, assets under management amounted to € 1o.9 billion – a figure that is only slightly below the level of 31st December 2oo7 (€ 11.4 billion). In this respect, MLP benefited from inflows into the new investment concepts for MLP clients, developed in conjunction with Feri. In old-age pension provision, the premium sum reached a new record level of € 1.9 billion (€ o.9 billion) in a first quarter. In the first quarter we have created a very solid base to enable us to gain further market share in old-age pension provision during this year.
MLP attracted a total of 9,ooo new clients during the period from January to March, taking the total number of clients to 724,ooo. As in previous first quarters, the number of consultants fell slightly to 2,6o2 (31st December 2oo7: 2,613) and was attributable to seasonal variations. Revenues per consultant rose significantly to € 54,ooo (€ 5o,ooo).
In the first quarter MLP specifically prepared its consultants in over 1o,ooo training days for the new changes to the German Insurance Contract Law, the Markets in Financial Instruments Directive (MiFID) and the flat-rate withholding tax. The training courses were successfully completed and MLP is excellently prepared for the extensive challenges that lie ahead, particularly with respect to the reform of the Insurance Contract Law.
In March, MLP again considerably strengthened its occupational pension provision business operations by acquiring TPC Group, Germany's leading provider of industry solutions for occupational pension schemes. In taking this step, MLP has significantly expanded the number of attractive association and corporate clients.
Total revenues in the financial services segment within the reporting period rose by 11.2% to € 147.o million, whereas total expenses increased by 7.7%, paving the way for MLP to achieve a 33.6% rise in segment earnings before interest and tax (EBIT) to € 24.4 million (€ 18.3 million). Taking into account a finance cost of € -o.6 million (€ -o.3 million), pre-tax profit (EBT) thus stood at € 23.8 million (€ 17.9 million).
In the Feri segment, MLP achieved total revenues of € 1o.7 million in Q1 2oo8, approximately equal to the previous year's level (€ 1o.8 million). This was achieved despite the negative development in the capital markets. Total expenses in this segment rose predominantly because of new hiring from € 9.4 million to € 1o.6 million. Accordingly, the segment earnings before interest and tax (EBIT) fell from € 1.4 million to € o.2 million. Including a finance cost of € o.2 million (€ o.1 million), profit before tax (EBT) amounted to € o.4 million (€ 1.4 million).
Total revenues in the holding segment within the reporting period fell by 33.9% to € 4.1 million. This figure includes a subsequent profit component from the sales of the former subsidiary MLP Lebensversicherung AG amounting to € o.3 million (€ 1.7 million). As the expenses in the same period only fell by 12.5%, earnings before interest and tax (EBIT) declined from € o.1 million to € –1.3 million. The dividend payment of our subsidiary Feri Finance AG in the reporting period was significantly higher compared to the previous year. Thus, we achieved EBT of € 1.2 million (€ 1.1 million).
There were no significant changes in the risk situation of the Group during the period under review. At the present moment in time, no existence-threatening risks to the MLP Group have been identified.
A detailed presentation of the corporate risks as well as a description of our risk management is contained in our annual report 2oo7.
Information concerning business with related companies and persons is presented in the notes.
In their spring reports, leading German economic research institutes take the view that the economic upswing in Germany - MLP's core market - will continue. However, contrary to the estimates at the beginning of the current financial year, the rate of growth is expected to slow. Following their predictions at the start of the year of 2.1% economic growth for 2oo8, the experts revised this figure downwards at the end of the first quarter to growth of just 1.8%. The forecast for next year has now also been significantly down rated, with the German economy expected to grow by just 1.4% in 2oo9. At the start of the year, this forecast was predicting 1.9% growth. The experts cite the weakening worldwide economic development, the as yet unresolved crisis in the financial markets as well as the strong euro as reasons for their dampened growth expectations.
Despite the reduced growth momentum in Germany, the experts still anticipate further improvement in the labour market for the rest of 2oo8 and in 2oo9. They expect an increase in employment and a fall in unemployment – taken as a year average, the number of people unemployed in 2oo9 is predicted to fall below the 3 million mark. This positive trend will probably help the domestic economy that is then expected to become a significant pillar of the upswing.
The business activities of MLP are focused on the areas of old age pension and healthcare provision as well as wealth management. We do not expect any significant changes in the framework conditions during the current financial year. On 1st January 2oo8 the new regulations of the German Insurance Contract Law came into effect. As these changes are very far-reaching and will also lead to adjustment processes on the part of our product partners, we can presently only limitedly estimate the short-term effects of the changes on our productivity. Furthermore, the legally required improved transparency for life insurance and health insurance products from 1st July 2oo8 could possibly lead to a change in client behaviour which, in turn, could negatively influence our business.
In view of the planned introduction of a flat-rate tax on capital gains in Germany on 1st January 2oo9, experts expect huge-scale redeployment of assets within the wealth management market during the current financial year. Thanks to our new wealth management concepts, optimised to the changed tax framework conditions, we are well positioned to benefit from such redeployments.
Against this macroeconomic and industry-specific background, we see no reason to amend the forecasts in our annual report 2oo7 concerning the business development in the financial year 2oo8. The uncertainties, resulting mainly from the regulatory changes, make it more difficult to provide an exact revenue and earnings forecast for the financial year 2oo8. Overall, we expect that total revenues will rise moderately and that our operating margin (EBIT margin) will initially decline slightly in the current financial year, but we do not expect it to fall below the high level achieved in the financial year 2oo6. For the following years we anticipate a return to an improvement in the margin.
There were no notable events after the balance sheet reference date that affected MLP's net assets, financial position or profit situation.
The development in the equity markets in the first quarter of 2oo8 was dominated by the worldwide financial crisis. Triggered by the US property crisis, worldwide renowned financial institutions were forced to implement further write-downs in their credit and derivatives portfolios. The US Federal Reserve Bank in particular responded to the crisis with further interest rate cuts. Furthermore, the US government announced a stimulus package to support the American economy. Despite these measures, the mood in the equity markets remained restrained. Fears that the crisis in the financial sector may not only have a lasting effect on the real economy in the USA, with corresponding consequences for equity prices, have far from been banished.
During the period under review the American benchmark index, the Dow Jones Industrial Average, fell by 6%. The MDAX, in which the MLP share is listed, declined by 9.5% compared to the start of the year. The DAX, which by comparison contains many more financials, lost significant ground and finished the quarter 17.8% lower. Although MLP is not affected by the US property crisis, its share price was unable to escape the negative trend within the financial sector. In the reporting period, the share price fell by 16% from € 1o.74 to € 9.o2. In April, the share rallied such that, at the end of April, the MLP share had returned to a price of around € 1o.7o.
At the Annual General Meeting on 16th May 2oo8 the Executive Board and Supervisory Board of MLP AG will propose an increase in the dividend of 25% from € o.4o to € o.5o per share, equating to the distribution of a dividend sum totalling around € 49 million to our shareholders. From this year,shareholders in MLP AG can receive a dividend volume up to € 4oo million tax-free. This results from the changed tax treatment of the incorporation of subsidiaries into the MLP AG and their subsequent sale, and is subject to final confirmation from the financial authorities.
In January 2oo8, we completed the second tranche of our share buyback programme. Overall, in the period between 8th November 2oo7 and 3oth January 2oo8, a further 1,957,656 shares were repurchased at an average unit price of € 9.66. Within the framework of the buyback programme we have thus distributed a further € 18.9 million to our shareholders. All shares acquired in connection with the two tranches of the share buyback programme were cancelled in March 2oo8. The number of outstanding MLP shares now stands at 97,991,524.
MLP-Share and MDAX
| All figures in €'000 | Notes | 1. Quarter 2008 | 1. Quarter 2007* |
|---|---|---|---|
| Revenues | (6) | 151,030 | 137,054 |
| Other revenues | 7,219 | 8,584 | |
| total revenues | 158,249 | 145,638 | |
| Commission expenses | –56,572 | –56,108 | |
| Interest expenses | –5,176 | –3,938 | |
| Personnel expenses | (7) | –28,725 | -23,501 |
| Depreciation and amortisation | –5,043 | –4,568 | |
| Operating expenses | (8) | –39,567 | -37,755 |
| Earnings from companies accounted for using the equity method | 80 | – | |
| earnings before interest and tax (ebit) | 23,246 | 19,767 | |
| Other interest and similar income | (9) | 1,368 | 1,504 |
| Other interest and similar expenses | (9) | –9,492 | –3,618 |
| finance cost | (9) | –8,124 | –2,113 |
| earnings before tax (ebt) | 15,122 | 17,654 | |
| Income taxes | –8,345 | –7,483 | |
| earnings from continuing operations after tax | 6,777 | 10,171 | |
| earnings from discontinued operations after tax | –65 | –1,610 | |
| net profit (total) | 6,712 | 8,561 | |
| Of which | |||
| shareholders of the MLP AG | 6,712 | 8,561 | |
| Minority interest account for | – | – | |
| earnings per share in € | |||
| from continuing operations | |||
| basic | 0.07 | 0.10 | |
| diluted** | 0.07 | 0.10 | |
| from continuing and discontinued operations | |||
| basic | 0.07 | 0.09 | |
| diluted** | 0.07 | 0.09 |
* Previous year's values adjusted. The adjustments are disclosed under note 3. ** The ordinary shares resulting from the conversion of convertible debentures are treated as shares already issued.
| All figures in €'000 | Notes | March 31, 2008 | December 31, 2007* |
|---|---|---|---|
| Intangible assets | 199.,823 | 184,739 | |
| Property, plant and equipment | 83,547 | 83,910 | |
| Investment property | 14,528 | 14,635 | |
| Investment of associates accounted for using the equity method | 1,659 | 1,579 | |
| Defered tax assets | 1,754 | 1,570 | |
| Receivables from clients from the banking business | 248,598 | 260,297 | |
| Receivables from banks from the banking business | (10) | 533,372 | 603,951 |
| Financial investments | (11) | 80,319 | 52,400 |
| Tax refund claims | 11,933 | 9,653 | |
| Other receivables and other assets | (12) | 111,914 | 162,075 |
| Cash and cash equivalents | 80,370 | 37,251 | |
| Non-current assets held for sale and | |||
| disposal groups | (13) | 9,999 | 12,154 |
| total | 1,377,816 | 1,424,214 |
| All figures in €'000 | Notes | March 31, 2008 | December 31, 2007* |
|---|---|---|---|
| Equity attributable to | |||
| MLP AG shareholders | (14) | 334,510 | 339,660 |
| Minority interest | – | 63 | |
| total shareholders' equity | (14) | 334,510 | 339,723 |
| Provisions | 47,731 | 43,777 | |
| Deferred tax liabilities | 10,028 | 9,897 | |
| Liabilities towards clients from the banking business | 722,627 | 724,816 | |
| Liabilities towards banks from the banking business | 24,217 | 27,465 | |
| Tax liabilities | 124 | 74 | |
| Other liabilities | 238,578 | 278,461 | |
| total | 1,377,816 | 1,424,214 |
* Previous year's values adjusted. The adjustments are disclosed under note 3.
| All figures in €'000 | 1st Quarter 2008 | 1st Quarter 2007* |
|---|---|---|
| Cash flow from operating activities | 89,934 | 41,481 |
| Cash flow from investing activities | –15,222 | –2,904 |
| Cash flow from financing activities | –11,480 | –154 |
| changes in cash and cash equivalents | 63,232 | 38,423 |
| Changes in cash equivalents due to exchange rate movements | – | –15 |
| Cash and cash equivalents at the end of the period | 100,408 | 121,697 |
| All figures in €'000 | 1st Quarter 2008 | 1st Quarter 2007* |
|---|---|---|
| Cash flow from operating activities | – | –435 |
| Cash flow from investing activities | – | –388 |
| Cash flow from financing activities | – | – |
| changes in cash and cash equivalents | – | –823 |
| Changes in cash equivalents due to exchange rate movements | – | –15 |
| Cash and cash equivalents at the end of the period | – | 1,474 |
* Previous year's values adjusted. The adjustments are disclosed under note 3.
| All figures in €'000 | Minority interest |
Total Share- |
||||||
|---|---|---|---|---|---|---|---|---|
| Share capital |
Capital- reserves |
Securities marked to market |
Other comprehensive income |
Treasury stock |
Total | holders' equity |
||
| as at jan 1, 2007 (as reported) |
108,781 | 14,487 | 69 | 348,392 | –148,353 | 323,376 | 63 | 323,439 |
| Valuation change | – | – | – | 1,445 | – | 1,445 | – | 1,445 |
| as at Jan, 2007 (adjusted) | 108,781 | 14,487 | 69 | 349,836 | –148,353 | 324,820 | 63 | 324,883 |
| Currency translation | – | – | – | –33 | – | –33 | – | –33 |
| Securities marked to market | – | – | 50 | – | – | 50 | – | 50 |
| net income recognised directly in equity |
– | – | 50 | –33 | – | 17 | – | 17 |
| Net profit* | – | – | – | 8,561 | – | 8,561 | – | 8,561 |
| total recognised income and expense |
||||||||
| for the period | – | – | 50 | 8,528 | – | 8,578 | – | 8,578 |
| Dividend* | – | – | – | – | – | – | – | – |
| Convertible debentures | – | 422 | – | – | – | 422 | – | 422 |
| Acquisition of treasury stock | – | – | – | – | – | – | – | – |
| sum of other equity | ||||||||
| capital changes | – | 422 | – | – | – | 422 | – | 422 |
| as at march 31, 2007 | 108,781 | 14,909 | 119 | 358,364 | –148,353 | 333,820 | 63 | 333,883 |
* Adjusted. The adjustments are disclosed under note 3.
| All figures in €'000 | Equity attributable to MLP AG shareholders |
Minority interest |
Total Share- holders' |
|||||
|---|---|---|---|---|---|---|---|---|
| Share capital |
Capital- reserves |
Securities marked to market |
Other comprehensive income |
Treasury stock |
Total | equity | ||
| as at Jan 1, 2008 | 108,812 | 16,056 | -151 | 370,749 | –155,805 | 339,660 | 63 | 339,723 |
| Changes to the scope of consolidation |
– | – | – | – | – | – | – | – |
| Currency translation | – | – | – | – | – | – | – | – |
| Capital measures | – | – | – | – | – | – | – | – |
| Securities marked to market | – | – | –614 | – | – | –614 | – | –614 |
| net income recognised directly in equity |
– | – | –614 | – | – | –614 | – | –614 |
| Net profit | – | – | – | 6,712 | – | 6,712 | – | 6,712 |
| total recognised income and expense |
||||||||
| for the period | – | – | –614 | 6,712 | – | 6,098 | – | 6,098 |
| Convertible debentures | – | 206 | – | – | – | 206 | – | 206 |
| Acquisition of treasury stock | – | – | – | – | –11,455 | –11,455 | – | –11,455 |
| Reduction of capital – §237 AktG | –10,821 | 10,821 | – | –167,260 | 167,260 | – | – | – |
| Acquisition of remaining shares – BERAG | – | – | – | – | – | – | –63 | –63 |
| sum of other equity | ||||||||
| capital changes | -10,821 | 11,027 | – | –167,260 | 155,805 | –11,249 | –63 | –11,312 |
| as at march 31, 2008 | 97,992 | 27,083 | –765 | 210,201 | 0 | 334,510 | 0 | 334,510 |
| 141,509 | 127,119 | |
|---|---|---|
| – | – | |
| – | – | |
| 5,460 | 5,050 | |
| 146,969 | 132,169 | |
| –56,111 | –55,328 | |
| –5,176 | –4,000 | |
| –21,256 | –16,772 | |
| –3,513 | –2,986 | |
| –36,596 | –34,824 | |
| 80 | – | |
| 24,396 | 18,260 | |
| 41 | 40 | |
| –618 | –370 | |
| –577 | –330 | |
| 23,819 | 17,930 | |
| – | – | |
| – | – | |
| –27 | –1,975 | |
| – | – | |
| Financial services* 1st Quarter 2008 1st Quarter 2007 |
*Previous year's values adjusted. The adjustments are disclosed under note 3.
| Feri* | Holding* | Consolidation/ Other* |
Total* | ||||
|---|---|---|---|---|---|---|---|
| 1st Quarter 2008 1st Quarter 2007 1st Quarter 2008 1st Quarter 2007 1st Quarter 2008 1st Quarter 2007 1st Quarter 2008 1st Quarter 2007 | |||||||
| 9,521 | 9,935 | – | – | – | – | 151,030 | 137,054 |
| – | – | – | – | – | – | – | – |
| – | – | – | – | – | – | – | – |
| 1,212 | 872 | 4,108 | 6,216 | –3,560 | –3,555 | 7,219 | 8,584 |
| 10,733 | 10,807 | 4,108 | 6,216 | –3,560 | –3,555 | 158,249 | 145,638 |
| –462 | –780 | – | – | – | – | –56,572 | –56,108 |
| – | – | – | – | – | 62 | –5,176 | –3,938 |
| –6,368 | –5,294 | –1,101 | –1,435 | – | – | –28,725 | –23,501 |
| –674 | –691 | –856 | –891 | – | – | –5,043 | –4,568 |
| –3,070 | –2,677 | –3,411 | –3,809 | 3,510 | 3,555 | –39,567 | –37,755 |
| – | – | – | – | – | – | 80 | – |
| 159 | 1,364 | –1,260 | 82 | –50 | 62 | 23,246 | 19,767 |
| 237 | 73 | 11,774 | 4,480 | –10,684 | –3,089 | 1,368 | 1,504 |
| 0 | 0 | –9,352 | –3,471 | 478 | 224 | –9,492 | –3,618 |
| 236 | 73 | 2,422 | 1,009 | –10,206 | –2,865 | –8,124 | –2,113 |
| 396 | 1,437 | 1,162 | 1,091 | –10,256 | –2,803 | 15,122 | 17,654 |
| – | – | – | – | – | – | –8,345 | –7,483 |
| – | – | – | – | – | – | 6,777 | 10,171 |
| – | – | – | – | –38 | 365 | –65 | –1,610 |
| – | – | – | – | – | – | 6,712 | 8,561 |
The interim financial report were prepared by the MLP Group, MLP AG,Wiesloch, Germany. The MLP AG is listed in the Mannheim Commercial Register under the number HRB 332697 with the address Alte Heerstrasse 4o, 69168 Wiesloch, Germany.
Since it was founded in 1971, MLP has been advising academics and other discerning clients in the fields of old-age and health provision, insurance cover, financial investments and loans and mortgages. The MLP Group offers financial services, wealth management and banking services.
The interim financial report has been prepared in line with the regulations set out in IAS 34 (Interim financial reporting). It is based on the International Financial Reporting Standards of the International Accounting Standards Board (IASB) as well as the interpretations of the International Financial Reporting Interpretation Committee (IFRIC), as applicable within the European Union (EU). In accordance with the provisions of IAS 34, the scope of the report has been reduced compared to the consolidated financial statements at December 31, 2oo7. The interim accounts were not subject to an independent auditor's review.
Apart from the exception detailed in note 3, the same consolidation principles and accounting policies as for the consolidated financial statements of the financial year 2007 have been applied to this interim financial report. These are presented in the Group notes of the annual report 2oo7 that can be downloaded from the company's website (www.mlp. de).
The interim financial report has been drawn up in euros (€), the functional currency of MLP AG. Unless the notes state otherwise, all amounts are rounded to the nearest thousand euros (€'ooo). Both single and cumulative figures are values with the smallest rounding difference. As a result, differences to reported total amounts may arise when the individual values are added up.
The accounting policies applied are the same as those used in the previous year, with the following exceptions:
In the second quarter of 2007 MLP Finanzdienstleistungen Aktiengesellschaft was amalgamated with MLP Bank AG. Subsequently, MLP Bank AG was renamed "MLP Finanzdienstleistungen AG".
The amalgamation of MLP Finanzdienstleistungen Aktiengesellschaft with MLP Bank AG as well as the associated adjustment of the internal reporting from 2oo8, MLP now consolidates income/expenses from the brokerage business, income/expenses from the banking business and income/expenses from wealth management under the position "Revenues" or"commission or interest expenses". Furthermore, the cash or cash equivalents of MLP Finanzdienstleistungen AG are reclassified from the balance sheet item "cash or cash equivalents" to "Receivables from banks from the banking business". Additionally, the item "Receivables/Liabilities from banking business" has been split into the items "Receivables/Liabilities from/towards clients from banking business" or "Receivables/ Liabilities from/towards banks from banking business". In the cases mentioned, the previous year's figure was adjusted in accordance with IAS 8. These adjustments have no effect on either the Group result or the earnings per share.
The financial result is to be adjusted with respect to the income statement due to the change introduced at December 31, 2oo7 concerning the treatment of the paid dividend to the minority shareholders of the Feri-Group.
Due to cessation of brokerage activities in Great Britain and Spain in the third quarter of 2oo7 and their treatment as discontinued operations, MLP AG has adjusted the reported profit and loss account for the previous year. For this purpose, the expenses and income of MLP Private Finance plc., London, Great Britain, and MLP Private Finance Correduria de Seguros S.A., Madrid, Spain, in the comparative figures "1st Quarter 2oo7" have been reclassified to the earnings from discontinued operations.
In the fourth quarter of 2oo7 MLP changed the balance sheet preparation of cancellation provisions, and valued these for the first time without compensation effects. Cancellation provisions take account of the risk of a repayment of received commission due to premature discontinuation of brokered insurance contracts. In accordance with IAS 8 this change was to be undertaken retrospectively.
The tables below illustrate the effects of the changes in the accounting policies on the previous year's values:
| All figures in €'000 | Dec, 31 2007 Adjusted |
Dec, 31 2007 as reported |
+/– | Of which reporting change |
|---|---|---|---|---|
| Receivables from clients from banking business | 260,297 | – | 260,297 | 260,297 |
| Receivables from banks from banking business | 603,951 | – | 603,951 | 603,951 |
| Receivables from banking business | – | 771,751 | –771,751 | –771,751 |
| Receivables and other assets | 162,075 | 157,263 | 4,812 | 4,812 |
| Cash and cash equivalents | 37,251 | 134,559 | –97,309 | –97,309 |
| Liabilities towards clients due to banking business | 724,816 | – | 724,816 | 724,816 |
| Liabilities towards banks due to banking business | 27,465 | – | 27,465 | 27,465 |
| Liabilities due to banking business | – | 752,281 | –752,281 | –752,281 |
| All figures in €'000 | 1st Quarter 2007 adjusted |
1st Quarter 2007 as reported |
+/– | Of which IFRS 5 |
Of which Provisions for cancellations |
Of which reporting change |
|---|---|---|---|---|---|---|
| Revenues | 137,054 | – | 137,054 | –877 | 1,525 | 136,406 |
| Revenues-brokerage business | – | 107,142 | –107,142 | – | – | –107,142 |
| Revenues-banking business | – | 18,922 | –18,922 | – | – | –18,922 |
| Revenues-wealth management | – | 9,935 | -9,935 | – | – | – 9,935 |
| Other revenues | 8,584 | 8,675 | –92 | –96 | – | 5 |
| total revenues | 145,638 | 144,674 | 964 | –973 | 1,525 | 411 |
| Commission expenses | –56,108 | – | –56,108 | 39 | –817 | –55,330 |
| Interest expenses | –3,938 | – | –3,938 | – | – | –3,938 |
| Expenses for brokerage business | – | –53,351 | 53,351 | – | – | 53,351 |
| Expenses for banking business | – | –5,883 | 5,883 | – | – | 5,883 |
| Expenses for wealth management | – | -780 | 780 | – | - | 780 |
| Personnel expenses | –23,501 | –24,602 | 1,101 | 1,101 | – | – |
| Depreciation and amortisation | –4,568 | –4,632 | 65 | 65 | – | – |
| Operating expenses | –37,755 | –38,764 | 1,009 | 1,761 | – | -753 |
| earnings before interest | ||||||
| and tax (EBIT) | 19,767 | 16,661 | 3,106 | 1,993 | 708 | 405 |
| Other interest and | ||||||
| similar income | 1,504 | 1,934 | –430 | –19 | – | –411 |
| Other interest and | ||||||
| similar expenses | –3,618 | –1,473 | –2,145 | – | – | –2,145 |
| finance cost | –2,113 | 462 | –2,575 | –19 | – | –2,556 |
| earnings before | ||||||
| tax (EBT) | 17,654 | 17,123 | 532 | 1,975 | 708 | –2,151 |
| Income taxes | –7,483 | –7,242 | –241 | – | –241 | – |
| earnings from continuing | ||||||
| operations after tax | 10,171 | 9,880 | 291 | 1,975 | 467 | –2,151 |
| earnings from discontinued | ||||||
| operations after tax | –1,610 | 365 | –1,975 | –1,975 | – | – |
| net profit (total) | 8,561 | 10,245 | –1,684 | 0 | 467 | –2,151 |
| Earnings per share in € | ||||||
| From continuing operations | ||||||
| basic | 0.10 | 0.10 | – | – | – | – |
| diluted | 0.10 | 0.10 | – | – | – | – |
| Earnings per share in € | ||||||
| From continuing and discontinued operations | ||||||
| basic | 0.09 | 0.10 | – | - | – | – |
| diluted | 0.09 | 0.10 | – | – | – | – |
On January 1, 2oo8, and thus earlier than legal requirements, the Group switched to using the new standard for segment reporting - IFRS 8 "Operative segments". Up until December 31, 2oo7 the segment reporting was undertaken in accordance with IAS 14 "Segment reporting"(see notes item 17 "Explanations to segment reporting"). The previous year's figures were adjusted accordingly. This reclassification had no effect on either the Group result or the earnings per share.
The first-time application of IFRIC 11 "Group and Treasury share transactions" and IFRIC 12 "Services concession agreements", the use of which became mandatory from January 1, 2008, had no effect on the presentation of the assets, financial or profit situation of the Group due to the lack of relevance of this content to MLP.
On February 29, 2oo8, MLP acquired 100% of the voting rights in TPC Group GmbH, Hamburg in order to strengthen its business in the area of occupational pensions. TPC Group GmbH was incorporated into the Group interim accounts from the date of acquisition (February 29, 2oo8).
TPC Group GmbH performs solely holding company functions as a parent company. It holds 1oo% of the shares in TPC THE PENSION CONSULTANCY GmbH ("TPC Pension Consultancy") and in TPC THE PRIVATE CONSULTANCY GmbH ("TPC Private Consultancy").
The TPC Group is specialised in the provision of consultancy, with a focus on the occupational pension provision. In addition to providing numerous pension solutions for leading trade associations, the company also places major emphasis on offering its consultation services to larger medium-sized companies as well as to implementing innovative concepts such as life work time accounts.
TPC Pension Consultancy operates in the following fields of business: consultancy services for employers and employees within the area of old-age pension provision as well as conceptual structure and contractual implementation with selected service partners, investment and contract conclusion brokerage as well as operating as an agent middleman within the meaning of § 93 of the German Commercial Code (HGB). TPC Pension Consultancy is a financial services institute within the meaning of § 1 Para. 1a Sentence 2 Nos. 1 and 2 of the German Banking Law (KWG).
The activities of TPC Private Consultancy entail the provision of holistic consultancy to high net-worth private clients as well as the brokerage of loan contracts and the brokerage of insurance products, limited partnership participations and certain investment funds. The company is an insurance broker within the meaning of § 93 of the German Commercial Code (HGB). The company also commercially brokers the conclusion of contracts for land and rights equivalent to real property as well as commercial premises. TPC Private Consultancy is a financial services institute within the meaning of § 1 Para. 1a Sentence 2 Nos. 1 and 2 of the German Banking Law (KWG).
| Purchase Price – All figures in €'000 | 2008 |
|---|---|
| Fixed purchase price component | 1,000 |
| Variable purchase price component (anticipated value) | 6,304 |
| Incidental acquisition expenses | 979 |
| total purchase price (provisional) | 8,283 |
The purchase price allocation regarding this acquisition is not finally closed. The differential amount between the provisional total purchase price and the appreciated fair value of the so far identified acquired assets, debts and contingent debts amounts to € 13,366 thsd. and is reported as preliminary goodwill under the intangible assets. MLP expects the final purchase allocation to include not only valuation adjustments with respect to the identified assets and debts, but possibly also the identification of other acquired assets with corresponding effects on the provisionally determined goodwill. The following table provides an overview of the provisional differential amount:
| Acquired net assets – All figures in €'000 | IFRS carrying amount (before purchase) |
Adjustment | Fair value |
|---|---|---|---|
| Intangible assets | 89 | – | 89 |
| Property, plant and equipment | 193 | – | 193 |
| Financial investments | 66 | – | 66 |
| Receivables and other assets | 3,684 | – | 3,684 |
| Cash and cash equivalents | – | – | – |
| Provisions | –123 | – | –123 |
| Liabilities | –8,992 | – | –8,992 |
| Deferred tax liabilities | – | – | – |
| total net assets | –5,083 | – | –5,083 |
| Proportion of net assets | 100,00 % | –5,083 | |
| Good will (Provisional) | 13,366 | ||
| total purchase price (provisional) | 8,283 | ||
| Accrued liabilities | 6,304 | ||
| Net cash outflow from acquisition | 1,979 |
The TPC Group's contribution to the MLP Group interim result since the acquisition date amounted to € –224 thsd. If the integration had taken place at the start of the year, the Group result would have amounted to € 5,8o8 thsd. and the revenues from continuing operations for the first quarter of 2oo8 would have totalled € 151,395 thsd.
Due to the seasonal development of its business, the group generally expects earnings from continuing operations to be higher in the residual year than in the first quarter.
| All figures in €'000 | 1st Quarter 2008 1st Quarter 2007 | |
|---|---|---|
| Old-age pension provision | 89,249 | 61,808 |
| Wealth management | 20,637 | 24,443 |
| Non-life insurance | 15,765 | 12,959 |
| Health insurance | 11,422 | 25,576 |
| Loans and mortgages | 3,195 | 3,917 |
| Other commissions and fees | 781 | 623 |
| comissions and fees | 141,049 | 129,326 |
| interest income | 9,981 | 7,728 |
| total | 151,030 | 137,054 |
Personnel expenses increased from € 23,5o1 thsd to € 28,725 thsd, primarily due to general salary increases, to off compensatory payments and additional personnel in the wealth management area.
At March 31, 2oo8 the group had the following numbers of employees in the strategic fields of business:
| March 31, 2008 | March 31, 2007 | |||
|---|---|---|---|---|
| part- | part | |||
| time | time | |||
| employees | employees | |||
| Financial services | 1,767 | 480 | 1,584 | 414 |
| Feri | 249 | 57 | 228 | 55 |
| Holding | 12 | 1 | 10 | – |
| total | 2,028 | 538 | 1,822 | 469 |
The increase of the numbers of employees in the financial services segment is caused by the acquisition of the TPC Group (64 employees).
| All figures in €'000 | 1st Quarter 2008 1st Quarter 2007 | |
|---|---|---|
| IT costs | 10,112 | 7,917 |
| Cost of premises | 5,490 | 5,531 |
| Audit and consultancy costs | 3,347 | 2,688 |
| Training and seminars | 3,061 | 2,261 |
| Communication requirements | 2,197 | 2,052 |
| Allowances and bad debts | 2,161 | 2,126 |
| Advertising expenses | 1,797 | 2,021 |
| Representation, entertainment expenses | 1,414 | 1,350 |
| Laptop rental | 826 | 765 |
| Office supplies | 705 | 685 |
| Premiums and fees | 427 | 548 |
| Repairs and maintenance | 179 | 173 |
| Currency translation expenses | 152 | 24 |
| Other taxes | 51 | 45 |
| Sundry other expenses | 7,647 | 9,569 |
| total | 39,567 | 37,755 |
The increase of the IT costs is mainly caused by higher costs for maintenance and licence fees. Sundry other expenses mainly comprises other banking-related expenses, insurances, other rents, other personnel costs as well as travelling costs.
| All figures in €'000 | 1st Quarter 2008 1st Quarter 2007 | |
|---|---|---|
| Other interest and similar income | 1,368 | 1,500 |
| Income from loans | – | 4 |
| other interests and similar income | 1,368 | 1,504 |
| Interest and similar expenses | –9,334 | –3,413 |
| Discount adjustment on pension provisions | –144 | –200 |
| Losses on the disposal of financial investments | –15 | –4 |
| interest and similar expenses | –9,492 | –3,618 |
| total | –8,124 | –2,113 |
The change in the finance cost is primarily attributable to dividend payments to the other shareholders of Feri Finance AG which is disclosed in the income statement as interets expenses. The payments in the first quarter 2oo8 amounted to € 7,83o thsd. (previous year: € 2,151 thsd.).
This position contains the cash and cash equivalents of MLP Finanzdienstleistungen AG. The reduction in receivables from banks from € 6o4 million to € 533 million results mainly from the transfer of profit to MLP AG.
| All figures in €'000 | March 31, 2008 | March 31, 2007 |
|---|---|---|
| Available for sale: | ||
| Securities | 40,894 | 34,741 |
| Investments | 3,629 | 3,629 |
| Held to maturity securities | 15,716 | 13,963 |
| Loans and receivables | 20,080 | 66 |
| total | 80,319 | 52,400 |
The increase of the loans and receivables is caused by time deposits.
Due to the seasonally strong year-end business, high receivables from insurance companies as well as high liabilities towards commercial agents were reported at December 31, 2oo7 which were then balanced out in the first quarter of 2oo8. A lower amount of receivables and liabilities were built up in the first quarter of 2oo8.
This item also includes shares in an investment fund intended for sale. Through sales, the holding has fallen by € 2.2 million to € 1o.o million.
The subscribed capital consists of 97,991,524 (December 31, 2oo7: 1o8,812,289) no par value common shares. The decrease results from the withdrawal of own shares. The capital reserve was increased to the same level. In the first quarter 2oo8, no new shares were issued through the exercising of rights of conversion. In total, so far 171,6o3 new shares have been issued through issued convertible debentures.
Up to December 31, 2oo7 MLP AG bought back a total of 9,648,6o9 of its own shares. In the first quarter of 2oo8 a total of a further 1,172,156 own shares were acquired. All 1o,82o,765 own shares were withdrawn in March 2oo8.
At the Annual General Meeting on May 16, 2oo8 the Executive and Supervisory Boards of MLP AG will be proposing a dividend of € o.5o per share for the financial year 2oo7. For the financial year 2oo6 MLP AG distributed in the second quarter 2oo7 a dividend amounting to € o.4o per share.
In the course of restructuring its foreign business in 2007, MLP sold MLP Private Finance plc., London, Great Britain and MLP Private Finance Correduria de Seguros S.A., Madrid, Spain. In 2oo6 the business operations of MLP Private Finance AG, Zurich, Switzerland were discontinued. In 2oo5, MLP Lebensversicherung AG, Heidelberg, and MLPVersicherung AG, Heidelberg were sold. Together, these five companies form the discontinued operations.
| All figures in €'000 | 1st Quarter 2008 1st Quarter 2007 | |
|---|---|---|
| Revenues | – | 877 |
| Other revenues | – | 96 |
| total revenues | – | 973 |
| Other expenses | – | –2,966 |
| earnings before interest | ||
| and taxes (ebit) | – | –1,993 |
| Finance cost | – | 19 |
| earnings before | ||
| tax (ebt) | – | –1,975 |
| Inccome taxes | – | – |
| operating result from discontinued operations | – | –1,975 |
| Earnings from the sale of operations | –80 | 434 |
| Income taxes | 15 | –69 |
| earnings per share in € from discontinued operations | –65 | -1,610 |
| earnings per share in € | ||
| From discontinued operations | ||
| basic | 0.00 | –0.01 |
| diluted | 0.00 | –0.01 |
The operating result in Q1 2oo7 contains only the expenses and income of the subsidiaries in Great Britain and Spain.
The loss or profit shown in the position "Earnings from the sale of operations"includes run-on expenses and income that occured after the sale of the insurance companies and the foreign subsidiaries.
Cash and cash equivalents with a term to maturity of not more than three months are recorded under cash and cash equivalents. Cash equivalents are short term financial investments which can be converted into cash at any time and which are only subject to minor value fluctuation risks. The cash and cash equivalents disclosed in the balance sheet have been reduced by € 17 thsd. (previous year: € 16 thsd.) which are intended to other restraints.
Cash and cash equivalents are split across the following balance sheet items:
| All figures in €'000 | March 31, 2008 | March 31, 2007 |
|---|---|---|
| Cash and cash equivalents | ||
| Consolidated balance sheet | 80,370 | 80,253* |
| Restrains | –17 | –16 |
| Other investments < 3 months | 20,068 | 40,000 |
| Liabilities to banks due | ||
| on demand | -13 | –14 |
| cash and cash equivalents | 100,408 | 120,223 |
Includes cash and cash equivalents amounting to € 1,352 thsd. which are allocated to the non-current assets held for sale.
The receivables from the MLP Finanzdienstleistungen AG of the brokerage business are not included in the financial resources,since they are attributable to the current operations of the business field "Banking" (formerly MLP Bank AG).
The cash flow from operating activities was primarily influenced by the payment of the profit transfer by MLP Finanzdienstleistungen AG to MLP AG amounting to € 87,481 thsd. (Previous year: € 19,573 thsd.). The lower figure for the previous year was mainly due to an advanced distribution of profits in the financial year 2oo6.
*
Since January 1, 2008, and thus earlier than legally required, the Group has been using IFRS 8 "Operative segments". IFRS 8 requires the provision of information about the operative segments of the Group. The standard replaces IAS 14 "Segment reporting" and takes over the "Management Approach"for the segment reporting according to IFRS, as it is realised in SFAS 131. The classification of the reporting segments has thus to follow the one for the internal reporting.
For the purpose of segment reporting in accordance with IAS 14 "Segment reporting" the MLP Group previously structured itself into the following (primary) segments:
n Consulting and sales
Following the amalgamation of MLP Finanzdienstleistungen Aktiengesellschaft and MLP Bank AG in 2007, the internal reporting was adjusted in 2008 and no longer differentiates between the business fields "Consulting and sales" and "Banking". For the purpose of segment reporting in accordance with IFRS 8, these now jointly form the operative segment "financial services".
For the purpose of segment reporting in accordance with IFRS 8 "Operative segments", the MLP Group structures itself into the following operative segments:
The object of the financial services segment consists of consulting services for academics and other discerning clients, particularly with regardsto insurance, investments, occupational old-age pension provision schemes and financing as well as the brokerage of contracts concerning these financial services. The segment also includes the administration of financial portfolios, the trustee credit business and loan and credit card business. With 2,602 consultants and a comprehensive scope of services, the Group currently caters to some 724,000 clients in the named segments.
This segment, focussing on the brokerage business, is made up of MLP Finanzdienstleistungen AG, Wiesloch, BERAG Beratungsgesellschaft für betriebliche Altersversorgung und Vergütung mbH, Bremen, BERAG Versicherungs-Makler GmbH, Bremen, MLP BAV GmbH, Wiesloch, MLP Finanzdienstleistungen AG (previously MLP Vermögensberatung AG), Vienna, Austria, MLP Hyp GmbH, Schwetzingen and the TPC Group GmbH, Hamburg.
The discontinued operations of the financial services segment are made up of the subsidiaries MLP Private Finance plc., London, Great Britain, MLP Private Finance Correduria de Seguros S.A., Madrid, Spain, and MLP Private Finance AG, Zurich, Switzerland.
The business operations of the Feri segment cover wealth and investment consulting. This segment consists of Feri Finance AG für Finanzplanung und Research, Bad Homburg v.d. Höhe, Feri Wealth Management GmbH, Bad Homburg v.d. Höhe, Feri Institutional Advisors GmbH, Bad Homburg v.d. Höhe, and Feri Eurorating AG, Bad Homburg v.d. Höhe.
MLP AG, Wiesloch constitutes the Holding segment. The main internal services and activities are combined in this segment.
The accounting and valuation principles correspond to the principles used in the interim Group accounts, as stated in the last Group accounts at December 31, 2007. This also applies to transactions between the operative segments. The management reaches its decisions about resource allocation and the assessment of segment performance based on the segment result.
Presentation of the individual business sectors (primary segments) takes place after consolidation of transactions within the particular business sectors, but before cross segment consolidation.
Intrasegment supplies and services are settled in principle at normal market prices. In the case of intra-group allocations, an appropriate general overhead surcharge is levied on the direct costs actually incurred.
Segment reporting is classified mainly in conformity with the consolidated income statement in order to achieve greater transparency as regards earning power and prospects.
Depending on the future economic development of TPC Group GmbH, Hamburg, the fixed purchase price component can be supplemented with a variable purchase price component of up to € 24.7 million. MLP expects that this variable component of the purchase price will amount to € 6.3 million. The variable purchase price component is due in 2o13 and is expected to lead to an outflow of funds of around € 7.4 million or € 29.o million (maximum amount).
Beyond this, there were no other significant changes in the contingent liabilities and other obligations during the period under review.
There were no significant changes compared to December 31, 2oo7.
There were no notable events after the balance sheet date which may affect the MLP Group's net assets, financial position or results of operations.
Wiesloch, May 6, 2oo8 MLP AG
Executive Board
Dr. Uwe Schroeder-Wildberg Gerhard Frieg Muhyddin Suleiman
Gerhard Frieg (Product management and purchasing, appointed until May 18, 2o12)
Muhyddin Suleiman (Sales and marketing, appointed until September 3, 2o12) Supervisory Board Manfred Lautenschläger
(Chairman)
Gerd Schmitz-Morkramer (Vice Chairman)
Dr. Peter Lütke-Bornefeld
Johannes Maret
Maria Bähr (Employee Representative)
Norbert Kohler (Employee Representative)
Tel +49 (o) 6222 • 3o8 • 832o Fax +49 (o) 6222 • 3o8 • 1131 [email protected]
Tel +49 (o) 6222 • 3o8 • 831o Fax +49 (o) 6222 • 3o8 • 1131 [email protected]
Annual General Meeting 2oo8, Mannheim, Germany
May 27 to 29, 2008 Roadshow USA
June 4, 2008 German Corporate Conference Deutsche Bank, Frankfurt am Main, Germany
August 13, 2008 Results for the 2nd quarter 2oo8
November 12, 2008 Results for the 3rd quarter 2oo8
This documentation includes certain prognoses and information on future developments founded on the conviction of MLP AG's Executive Board and on assumptions and information currently available to MLP AG. Words such as "expect,""anticipate,""estimate,""assume,""intend,""plan,""should,""could,""project" and other similar terms used in reference to the company describe prognoses based on certain factors subject to uncertainty.
Many factors can contribute to the actual results of the MLP Group differing significantly from the prognoses made in such statements.
MLP AG accepts no liability to the public for updating or correcting prognoses. All prognoses and predictions are subject to variousrisks and uncertainties,which can lead to the actualresults differing from expectations. The prognoses reflect the points of view at the time when they were made.
MLP AG Alte Heerstraße 40 69168 Wiesloch Telefon +49 (0) 6222 • 308 • 0 Telefax +49 (0) 6222 • 308 • 9000 www.mlp.de
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