FY- -07 Results & 07 Results & FY 2008- -09 Outlook 09 Outlook 2008 Built Around the Future Giorgio Girelli, CEO Milan, March 13, 2008
Today’ Today ’s Agenda s Agenda I. FY 2007 RESULTS II. 2008 MAIN GUIDELINES III. STRATEGIC OUTLOOK 2 Banca Generali FY-07 Results & 2008-09 Outlook
I. FY 2007 RESULTS Banca Banca Generali: a Top Player in the best performing Distribution Generali: a Top Player in the best performing Distribution Channel… … Channel 57.7 Net Inflows in Mutual Funds and Sicavs by distribution channel (€ bn) 20.0 17.0 9.7 9.8 9.3 7.4 4.8 2.6 2.5 1.3 (0.9) (2.4) (3.2) (8.9) (9.5) (24.1) (25.3) (50.4) (71.5) (1) 2000 2001 2002 2003 2004 2005 2006 2007 2000-07 Jan-Feb Cumulative 2008 Net Inflows FAs Network Net Inflows Other Distribution Channels (i.e. Bank Outlets, Post Offices) (1) The FAs Network Net inflows include only January 08 Source: Assoreti – Assogestioni 3 Banca Generali FY-07 Results & 2008-09 Outlook
I. FY 2007 RESULTS … Increasing Assets and Net Inflows even under unfavorable Market Increasing Assets and Net Inflows even under unfavorable Market Conditions Conditions … Net Inflows AUM Net Inflows AUM (€ bn) (€ m) 2,372 24.5 2,309 23.7 � 10.3% market share in AUM 18.3 1,561 � Resilient Net Inflows in a difficult market, with excellent growth in Private Banking 2005 2006 2007 2005 2006 2007 Financial Advisors (1) AUM/FA (1) Financial Advisors AUM/FA (€ m) (n°) � Our main goal remains 2,006 1,651 1,534 upgrading FA’s network profile 27.2 27.1 rather than increasing their 259 233 9.4 number 8.8 7.9 2007 2005 2006 (2) 2005 2006 (2) 2007 Source: Assoreti Banca BSI Italia Simgenia Banca Generali (1) Excluding Simgenia, FAs amounting to 2,652 at December 2007 (2) Banca BSI Italia was acquired in July 2006 – 2006 data include the Customer Relationship Officers following the spin-off of Banca Generali Private Banking unit (as from January 1, 2007) 4 Banca Generali FY-07 Results & 2008-09 Outlook
I. FY 2007 RESULTS FY 2007 Results at a Glance (1/2): Further and steady progress on profitability improvement n profitability improvement FY 2007 Results at a Glance (1/2): Further and steady progress o AUM Profitability (1) Cost Income Ratio (2) AUM Profitability Cost Income Ratio (2) 1.43% + 0.09 p.p. + 0.09 p.p. 1.34% 1.25% -3.9 p.p. -6.7 p.p. 70.1% +1.1 p.p. 64.5% 63.4% + 0.10 p.p. + 0.06 p.p. 59.5% 1.39% 1.23% 1.29% 2005 2006 (LfL) 2007 (Adj) 2007 2005 2006 2007 AUM profitability excluding performance fees Performance fees • AUM Profitability growth driven by net interest income & recurring fees Adjusted Cost/Income strongly improved at 59.5% � More than 10 b.p. improvement in the last 2 years � (1) Calculated as (Gross Commissions + Net Interest Margin) / Average AUM (2) Calculated as (Total Administrative Expenses + Other Expenses – Other Income)/Total Income Note: 2007 Adjusted figures for € 15.7 m unrealised capital losses at fair value on trading investment portfolio (HFT) 5 Banca Generali FY-07 Results & 2008-09 Outlook
I. FY 2007 RESULTS FY 2007 Results at a Glance (2/2): Jump in Profits and Dividend FY 2007 Results at a Glance (2/2): Jump in Profits and Dividend EBITDA (1) Net Profit and Dividend EBITDA Net Profit and Dividend (€ m) (€ m) +17% As announced, dividends paid on + 80% Adjusted Net Profit 82.0 25.3 69.8 66.3 15.3 14.0 34.8 1.7 2005 2006 2007 (Adj) 2007 30.8 60.2 57.2 72.9 � Impressive Adjusted Earnings & Dividend growth 2005 2006 2007 2007 (Adj) 2006 2007 Performance fees EBITDA excluding performance fees € 0.18* +80% € 0.10 DPS • 2007 Adjusted EBITDA up 17% vs. 2006 130% * +50 p.p. 80% PAY OUT (1) Calculated as Operating Profit before Provisions + Depreciation & Amortization * Board of Directors proposal to AGM due April 22, 2008 Note: 2007 Adjusted figures for € 15.7 m unrealised capital losses at fair value on trading investment portfolio (HFT) 6 Banca Generali FY-07 Results & 2008-09 Outlook
I. FY 2007 RESULTS Non- -Recurring Items Affecting FY 2007 Results Recurring Items Affecting FY 2007 Results Non � Unrealised capital losses at fair value on trading investment portfolio at 2007 Year- � Unrealised capital losses at fair value on trading investment portfolio at 2007 Year- Adjustment for End amounted to € 15.7m (vs. € 15.2m at end-September). Adjustment for End amounted to € 15.7m (vs. € 15.2m at end-September). Unrealised � In 4Q 07 Banca Generali further strengthened an already defensive asset Unrealised � In 4Q 07 Banca Generali further strengthened an already defensive asset Capital Losses allocation: Capital Losses allocation: � Equity weight < 2%; 97.4% of bonds rated > = A; no subprime risk; maturity < 2 years; � Equity weight < 2%; 97.4% of bonds rated > = A; no subprime risk; maturity < 2 years; � The more volatile investments were sold (about € 100m) � The more volatile investments were sold (about € 100m) � The 2008 projected Italian corporate tax rate reduction (IRES & IRAP) affected � The 2008 projected Italian corporate tax rate reduction (IRES & IRAP) affected Tax Rate Tax Rate anticipated and deferred taxes in 2007, with a non-recurring extra charge of anticipated and deferred taxes in 2007, with a non-recurring extra charge of Changes Changes some €4m , therefore increasing consolidated tax rate to close 60%. some €4m , therefore increasing consolidated tax rate to close 60%. Recruiting � The expiry of FA recruiting incentive plans implied a decrease in provisions to Recruiting � The expiry of FA recruiting incentive plans implied a decrease in provisions to Costs Costs € 21m (vs. € 31m at end-September) thus increasing commission expenses € 21m (vs. € 31m at end-September) thus increasing commission expenses by € 13m , which penalised Net Banking Income, Cost/Income and EBITDA. Treatment by € 13m , which penalised Net Banking Income, Cost/Income and EBITDA. Treatment 7 Banca Generali FY-07 Results & 2008-09 Outlook
I. FY 2007 RESULTS FY 2007 Consolidated Consolidated Profit & Loss Profit & Loss FY 2007 (€ m) FY06 (LfL) FY07 % Chg (YoY) FY07 (Adj) % Chg (YoY) � Net Interest Income up 48%, thanks to Net I nterest I ncom e 2 9 ,1 4 3 ,1 4 8 ,1 % 4 3 ,1 4 8 ,1 % successful banking strategy Commission income 279,9 308,4 10,2% 308,4 10,2% Commission expense -129,5 -155,5 20,1% -155,5 20,1% � Net Commissions at € 153m, driven by recurring Net Com m ission 1 5 0 ,4 1 5 2 ,9 1 ,7 % 1 5 2 ,9 1 ,7 % fees even considering €13 m of non-recurring Net income (loss) from trading activities -4,8 3,3 -169,6% 3,3 -169,6% costs for the expirations of recruitment plans Unrealized gain (loss) at fair value -0,5 -15,7 n.m. 0,0 -100,0% Dividends 20,1 2,8 -85,8% 2,8 -85,8% � Net Banking Income + 4% stripping out for Net Banking I ncom e 1 9 4 ,3 1 8 6 ,6 -4 ,0 % 2 0 2 ,3 4 ,1 % € 15.7 m of unrealised capital losses at fair value Staff expenses -58,6 -57,1 -2,5% -57,1 -2,5% Other general and administrative expense -73,7 -70,8 -3,9% -70,8 -3,9% -132,3 -128,0 -3,3% -128,0 -3,3% Depreciation and amortisation -8,9 -7,1 -20,6% -7,1 -20,6% Other net operating income (expense) 9,2 7,7 -16,4% 7,7 -16,4% � Net Operating Expenses -1 3 2 ,0 -1 2 7 ,3 -3 ,5 % -1 2 7 ,3 -3 ,5 % Net Operating Expenses down 3.5%, driving Adjusted Cost/Income to 59.5% (-3.9 p.p.) � Adjusted Operating Profit + 20% Operating Profit 62,2 59,2 -4,8% 74 ,9 20 ,4 % Net adjustments for impair.loans and other assets -0,6 -0,6 -8,4% -0,6 -8,4% Net provisions for liabilities and contingencies -34,3 -21,4 -37,7% -21,4 -37,7% Gain (loss) from disposal of equity investments -0,1 0,0 -100,0% 0,0 -100,0% Profit Before Taxation 27,2 37,3 3 7,0 % 53 ,0 94 ,6 % � Direct income taxes -13,0 -22,0 69,6% -27,6 112,9% Tax-rate penalised by fiscal changes Net Profit 14,2 15,3 7 ,3 % 2 5 ,3 7 7 ,8% � Adjusted Net Profit at € 25m (+ 78% ) Cost / I ncom e Ratio 6 3,4 % 64,5% 1 ,1 p.p. 59,5% -3 ,9 p.p. � Adjusted EBITDA + 15% EBI TDA 7 1 ,2 6 6 ,3 -6 ,8 % 8 2 ,0 1 5 ,2 % Notes: - 2006 figures are Like-for-Like (including Banca BSI Italia and Sant’Alessandro Fiduciaria, which joined Banca Generali Group on July 1, 2006) - 2007 Adjusted figures for € 15.7 m unrealised capital losses at fair value on trading investment portfolio (HFT) 8 Banca Generali FY-07 Results & 2008-09 Outlook
I. FY 2007 RESULTS Investment Portfolio: Less Less Volatility Volatility on P&L on P&L… … Investment Portfolio: € 3.3 bn € 3.5 bn € 4.0 bn 31.12.06 30.09.07 31.12.07 Actions taken to reduce volatility: � Higher volatility bonds (about € 100m) were sold in the last quarter, with a realised capital loss of € 5.6m 94% 64% 94% (2.1) 66% 67% (2.3) (2.7) 94% booked in 2007 P&L (3.0) (3.3) (3.8) � New investment in bonds are classified as AFS. At the end of February 2008 they amounted to more than €700m (vs. € 100m 2007 YE) (0.85) (0.9) 24% (0.8) 22% 23% (0.3) 12% (0.4) 11% (0.35) 11% 6% (0.2) 6% (0.2) 6% (0.2) (0) (0.1) (0.1) (0) (0) (0) Trading Investment Portfolio (HFT) Bank Accounts Customer Loans/Mortgages Interbanking Loans Net Equity AFS Others 9 Banca Generali FY-07 Results & 2008-09 Outlook
Recommend
More recommend
