MLP starts year with slight growth

• Q1: Total revenue rises by 3 percent to EUR 119.8 million, EBIT climbs by 10 percent to EUR 4.4 million
• Early indicators for future revenue development positive – despite the persistently difficult market environment
• Outlook for 2014 reiterated

Wiesloch, 15th May 2014 – In the first quarter 2014 the MLP Group grew total revenue by 3 percent to EUR 119.8 million and increased earnings before interest and tax (EBIT) by 10 percent to EUR 4.4 million. Within a difficult market environment, old-age provision began to show initial signs of a pick-up and both wealth management and non-life insurance recorded revenue growth. Important early indicators for future revenue development also showed a positive trend.

“The market burdens remain high and place great demands on us,” comments Chief Executive Officer Dr. Uwe Schroeder-Wildberg. “Nevertheless, we have seen some positive signs during the first few weeks of the year but these still need to become more established.”

From January to March 2014 several early indicators for future revenue development showed a positive trend: The number of new clients increased by 20 percent compared to the same period of the previous year, climbing to 6,000 (Q1 2013: 5,000). New business in old-age provision rose by around 15 percent from EUR 550 million to EUR 630 million, whereas brokered new business within the overall industry fell by 16 percent. In the real estate sector, MLP is already registering noticeable interest from its clients even though the new product offering was only launched in March.

These positive trends are not yet fully reflected in the revenue from commissions and fees. In old-age provision, revenue rose by 3 percent to EUR 40.1 million (EUR 38.9 million). This area remains burdened by the discussions about the low interest rate environment as well as by the extensive negative reports about life insurers and their products. In wealth management revenue increased by 3 percent to EUR 32.6 million (EUR 31.7 million); assets under management at 31st March 2014 amounted to EUR 24.4 billion (31st December 2013: EUR 24.5 billion). In non-life insurance revenue rose to EUR 18.8 million (EUR 18.2 million) thus maintaining the continuous growth pattern of the last quarters. Loans and mortgages generated revenue of EUR 2.9 million (EUR 2.9 million) and thus remained at the level of the previous year; additional earnings from the joint venture company MLP Hyp amounted to EUR 0.2 million (EUR 0.1 million).

The health insurance environment remains difficult. According to figures released by the German Private Health Insurance Association in March of this year for example, within the industry as a whole, the number of people with full private health insurance in 2013 fell by 66,000. However, during the same time frame, MLP registered a slight increase in its corresponding number of insurees. In the first quarter too many clients remained hesitant. Against this backdrop, revenue at MLP decreased from EUR 13.9 million to EUR 11.4 million.

Across all consulting areas together, revenue from commissions and fees rose to EUR 107.1 million (EUR 106.4 million). Interest income totalled EUR 5.8 million (EUR 5.9 Mio.) and thus remained around the level of the previous year. Total revenue amounted to EUR 119.8 (EUR 116.4 million).

EBIT rose to EUR 4.4 million (EUR 4.0 million). Group net profit totalled EUR 3.4 million, increasing by 6 percent compared to the previous year (EUR 3.2 million).

New client numbers developed positively in the first quarter, resulting in 6,000 new clients – a figure which significantly exceeded gains in the first quarter of 2013 (5,000). In spite of the usual seasonal decrease in the first quarter of the year, the number of consultants stood at 1,979 (31st December 2013: 1,998) and thus fell only slightly. In the first quarter MLP opened two new branches in the university segment, one in Münster and one in Frankfurt.

The previous financial year clearly demonstrated the prevalence of even more difficult market conditions. This consequently makes it more difficult to issue a concrete forecast for the business development which led MLP – as communicated in February – to use a scenario-based approach in the forecast. Under the most probable scenario MLP continues to expect EBIT of around EUR 65 million in the financial year 2014. This base scenario assumes initial improvements to the general conditions. Risk factors for further development include the continuing, and in part very critical, public discussion about a possible further reduction in the guaranteed interest rate for life insurance and pension insurance policies. If, during the course of the year and on account of this situation, clients were to adopt a similarly hesitant approach as seen in 2013, MLP would expect a lower-based scenario to apply, corresponding to an EBIT of at least EUR 50 million. However, should the environment improve significantly more than currently expected, a higher-based scenario would be possible with EBIT rising up to a maximum of EUR 75 million. “Due to the market burdens, uncertainties remain with respect to the further operative development. As is usual in our business model, the upcoming quarters, and in particular the second-half year, will crucially influence the full-year result,” comments Chief Financial Officer Reinhard Loose. “It remains our objective to once again significantly increase revenue and earnings in 2014.”

MLP Group (in EUR million)	Q1/2014	Q1/2013	Change in %
Revenue	112.8	112.8	0
Revenue from commissions and fees	107.1	106.4	1
Interest income	5.8	5.9	-2
Other revenue	7.0	4.1	71
Total revenue	119.8	116.4	3
Earnings before interest and tax (EBIT)	4.4	4.0	10
Earnings before tax (EBT)	4.4	4.1	7
Group net profit	3.4	3.2	6
Earnings per share (diluted/undiluted) in EUR	0.03	0.03	0
Clients	836,200	830,300*	1
Consultants	1,979	1,998*	-1

*) 31st December 2013

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