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FY 2018: MLP significantly increases revenue and net profit

  • Total revenue grows by 6 percent to EUR 666.0 million, reaching a new peak; net profit for the period rises to EUR 34.5 million (plus 24 percent)
  • EBIT of EUR 46.4 million well within the predicted target corridor (EBIT 2017: EUR 37.6 million, operating EBIT 2017: EUR 46.7 million)
  • Growth in all consulting fields – largest percentage growth in real estate (plus 44 percent), non-life insurance (plus 10 percent) and wealth management (plus 6 percent)
  • Number of consultants increases to 1,928, bucking the market trend
  • Executive Board proposes a dividend of 20 cents per share
  • Outlook for 2019: Despite continued strong investments in the future to develop the university segment, MLP anticipates modest EBIT growth

Wiesloch, February 28, 2019 – The MLP Group has successfully closed the 2018 financial year and achieved its goals. The total revenue rose by 6 percent year on year to EUR 666.0 million, net profit grew by 24 percent to EUR 34.5 million. At EUR 46.4 million, earnings before interest and tax (EBIT) were on a par with the operating EBIT of the previous year (2017: EUR 46.7 million) and therefore comfortably within the target corridor forecast at the start of 2018. The company was able to improve in all consulting fields. The biggest increases were achieved in the business areas that MLP has established and expanded in previous years: real estate brokerage with plus 44 percent, non-life insurance with plus 10 percent and wealth management with plus 6 percent. Furthermore, MLP recorded the first year-on-year growth in the number of consultants since 2007 with a figure of 1,928 as at the end of the year.

Based on the earnings development, the Executive Board proposes a dividend per share of 20 cents. In the previous year MLP distributed 16 cents from the net profit and another 4 cents as compensation for the one-off costs incurred as a result of the separation of banking and brokerage business.

"MLP can look back on an important and at the same time very good year. The past twelve months have clearly confirmed that we chose the right path in our strategic further development. The proof of concept for our strategy of systematically broadening the revenue basis and making MLP less susceptible to short-term market influences is clear," says Chief Executive Officer Dr. Uwe Schroeder-Wildberg. "We have met our financial targets while also successfully investing in future growth. This is evident not least in the growing consultant numbers. In this market it is certainly not a given that all these developments go hand in hand."

FY 2018: Total revenue increases to EUR 666.0 million

In 2018 total revenue rose by 6 percent to EUR 666.0 million (2017: EUR 628.2 million). This is the highest figure since MLP discontinued its own insurance companies in 2005. At the same time commission income increased from EUR 589.9 million to EUR 624.8 million. At EUR 17.3 million, interest income was below that of the previous year (EUR 18.9 million).

Real estate brokerage, which has been strengthened since 2014, achieved the largest growth for the second year in succession with revenue increasing by 44 percent to EUR 20.1 million (EUR 14.0 million). Revenue in the non-life insurance area rose by 10 percent to EUR 120.3 million (EUR 109.9 million). The MLP Group benefited from both gains in MLP's private client business and the successful development at its subsidiary DOMCURA. In the wealth management area MLP saw growth for the ninth year in succession; year on year, growth stood at 6 percent and revenue climbed to EUR 202.0 million (EUR 190.6 million). Assets under management declined to EUR 34.5 billion in the final quarter (September 30, 2018: EUR 36.1 billion) as a result of the weak development of the capital markets, however they are still above EUR 33.9 billion, the value of December 31, 2017. Slight growth rates year on year were achieved in the fields of loans and mortgages (plus 5 percent to EUR 17.8 million), health insurance (plus 4 percent to EUR 47.7 million) and old-age provision (plus 2 percent to EUR 212.3 million).

EBIT rose to EUR 46.4 million

EBIT increased to EUR 46.4 million in last financial year (2017: EUR 37.6 million). It is therefore at the same level as the operating EBIT for 2017 of EUR 46.7 million, which did not contain the one-off expenses of EUR 9.1 million for the separation of the banking and brokerage business. The net profit for the period rose significantly to EUR 34.5 million (EUR 27.8 million).

The Executive Board proposes a dividend of 20 cents per share for the last financial year. In the previous year, MLP paid out 20 cents per share. 16 cents of this were attributable to Group net profit. In addition to this, MLP compensated its shareholders for the one-off expenses accrued in the course of separating the banking and brokerage business with 4 cents per share. At 63 percent of net profit, the payout ratio is within the announced corridor.

Q4: Total revenue increases to EUR 203.4 million

Considering the final quarter on its own, total revenue rose by 9 percent to EUR 203.4 million (Q4 2017: EUR 187.5 million). EBIT was EUR 23.5 million (EBIT Q4 2017: EUR 23.0 million, operating EBIT Q4 2017: EUR 25.3 million). Group net profit for the period was EUR 17.1 million (Q4 2017: EUR 16.7 million).

MLP serves 541,200 family clients and 20,900 corporate clients

As of December 31, the MLP Group served 541,200 family clients (September 30, 2018: 538,100) and 20,900 corporate and institutional clients (September 30, 2018: 20,600). The number of newly acquired family clients amounted in 2018 to 18,300 (2017: 19,800), around 29 percent of which were initiated online.

The number of consultants rose for the first time year on year since the financial year 2007 and stood at 1,928 as at the end of the year (December 31, 2017: 1,909, September 30, 2018: 1,888). As such, MLP is bucking the trend on the market, as the number of intermediaries dropped by a good 19,000 in 2018 alone.

Outlook for 2019: Modest increase in EBIT anticipated

The increase in the number of consultants at MLP is evidence primarily of the strengthening of the university segment, in which additional total investments of around EUR 7 million were made in 2018 alone. In the current year MLP will continue to drive the development of the university segment and with it consultant and new client growth. To this end additional funds of around EUR 8 million will be made available. Further strategic focal points will be ongoing digitalisation and further broadening of the revenue basis. In addition, MLP will continue with its tight cost management and strive for further inorganic growth. Details on our outlook will be presented at today’s annual press and analyst conference.

Despite the continued strong investments in the future, particularly in strengthening the university segment, MLP anticipates slight EBIT growth in the financial year. "We have significantly strengthened and expanded the earnings level over the past years. On this good foundation, we are confident of achieving modest increases again, despite major investments in the future," says Chief Financial Officer Reinhard Loose.

The annual press conference takes place online today at 10 am, while the analysts' conference is at 2 pm online. All information is available under the following link: https://mlp-se.com/corporate-calendar/annual-press-conference-2019/

An overview of key figures

MLP Group (in EUR million) Q4/
2018
Q4/
2017
Change
in %
12 months
2018
12 months
2017
Change
in %
Revenue 191.2 182.4 5 642.1 608.7 6
Commission income 186.7 177.9 5 624.8 589.9 6
Interest income 4.5 4.5 - 17.3 18.9 -9
Other revenue 12.3 5.1 >100 23.8 19.4 23
Total revenue 203.4 187.5 9 666.0 628.2 6
Operating EBIT 23.5 25.3 -7 46.4 46.7 -1
Earnings before interest and tax (EBIT) 23.5 23.0 2 46.4 37.6 23
Earnings before tax (EBT) 23.5 22.5 4 45.8 36.4 26
Net profit for the period 17.1 16.7 2 34.5 27.8 24
Earnings per share (diluted/ basic) in EUR 0.16 0.15 7 0.32 0.25 28
Family clients 541,200 538,100* 1
Corporate, institutional clients 20,900 20,600* 1
Client consultants 1,928 1,888* 2

*) 30th September 2018