DGAP-IRE: vwd experiences setback in growth

vwd Vereinigte Wirtschaftsdienste AG / Release of an announcement according to Article 37x of the WpHG [the German Securities Trading Act]

12.05.2010 09:01

Interim report according to Article 37x of the WpHG, transmitted by
DGAP - a company of EquityStory AG.
The issuer is solely responsible for the content of this announcement.
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vwd experiences setback in growth

Difficult first quarter puts pressure on sales and EBITDA

Frankfurt am Main, May 12, 2010 - The vwd group, the leading German
provider of tailored information, communication and technology solutions
for the securities business, has felt the impact of the global financial
crisis in the end. During the first quarter of the current fiscal year, the
company saw its sales fall for the first time in five years. As expected,
the company's business proved to be very difficult during the first three
months of 2010.

Economy and sector development: still too little momentum for investments
The economic outlook provides little reason to expect any sustainable
improvement in those sales markets that are relevant to vwd. Demand is
waning in particular for marketing and communication services related to
financial-market products. The financial sector continues to be very
reluctant to invest in new technologies. This trend particularly hurts the
solution business that is so critical to vwd's performance.

Business trends: sales decrease for first time
Even though recurring revenues remained constant during the period under
review, the negative impact of the global financial crisis was much
stronger than in the previous year. In particular, the business involving
the sale of software licenses and the project business fell steeply
compared with the same quarter last year. This resulted in part from
customers' reluctance to add new systems and the company's inability to
bill for ongoing projects. But this is expected to have a positive effect
in the second quarter. Transaction-related sales of the vwd group also
finished the quarter at a low level as a result of weak trading volume.
Budget cuts imposed by the financial industry on marketing and
communication services continued during the first quarter. But they could
be offset by sales generated by a new cooperation partner and the inclusion
of a new subsidiary. Quarterly sales for the vwd group dropped by EUR 1,757
thousand to EUR 18,390 thousand (previous year: EUR 20,147 thousand).

Earnings situation: EBITDA very strong
vwd's earnings power suffered in the first quarter of 2010. Nonetheless,
its earnings before interest, taxes, depreciation and amortization (EBITDA)
were very positive. EBITDA fell by EUR 1,091 thousand to EUR 1,571 thousand
(previous year: EUR 2,662 thousand).
Although the vwd group tried to maintain its usual earning strength by
cutting costs, depreciation, amortization and impairments resulting from
the purchase-price allocation on newly acquired companies led to a decrease
in earnings before interest and taxes (EBIT). Depreciation, amortization
and impairments climbed by EUR 223 thousand, half of which resulted from
the purchase-price allocation, to EUR 1,093 thousand (previous year: EUR
870 thousand). Overall, EBIT fell by EUR 1,314 thousand to EUR 478 thousand
(previous year: EUR 1,792 thousand). Non-audited net income dropped by EUR
947 thousand to EUR 153 thousand (previous year: EUR 1,100 thousand) as a
result of fictional interest expenses related to the existing put option to
acquire the remaining shares of the EDG group totaling EUR 127 thousand.

Net income after minorities fell by EUR 932 thousand (previous year: EUR
1,013 thousand). In the first quarter of 2010, earnings per share totaled
EUR 0.003 per share (previous year: EUR 0.039).

Segment Market Data Solutions (MDS)
In the MDS Segment, less license revenue from the business with
portfolio-management solutions was generated in the first quarter of 2010
compared with the same quarter of the previous year. As a result, sales
decreased by EUR 685 thousand to EUR 8,518 thousand (previous year: EUR
9,203 thousand). At the same time, EBITDA fell by EUR 322 thousand to EUR
820 thousand (previous year: EUR 1,142 thousand).

Segment Technology Solutions (TS)
While the TS Segment's business with regular customers performed normally,
non-recurring income finished the first quarter below expectations as a
result of the strong reluctance to make investments. In addition, ongoing
projects could not be billed. These developments caused the segment's sales
to fall by EUR 533 thousand to EUR 4,387 thousand (previous year: EUR 4,920
thousand). EBITDA dropped by EUR 516 thousand to EUR 114 thousand (previous
year: EUR 630 thousand).

Segment Specialised Marketing Solutions (SMS)
Compared with the other two segments, changes in the SMS Segment were more
moderate overall. This segment was able to partially cushion the extensive
decrease in sales experienced in its business with mutual funds by finding
new cooperation partners. The positive effects from the acquisition of the
EDG group were the primary reason for the segment's more positive
performance. In the SMS Segment, sales remained nearly constant at EUR
5,485 thousand (previous year: EUR 5,494 thousand). The segment's EBITDA
fell by EUR 252 thousand to EUR 637 thousand (previous year: EUR 889
thousand).

Financial and asset situation: vwd remains solidly financed
On March 31, 2010, the vwd group had cash and cash equivalents totaling EUR
10,841 thousand (December 31, 2009: EUR 9,293 thousand). The rise in cash
and cash equivalents resulted largely from the receipt of customer
payments. These payments raised total assets to EUR 85,833 thousand
(December 31, 2009: EUR 80,953 thousand) and led to a seasonal reduction of
the equity ratio to 35.6 % (December 31, 2009: 37.2 %). As a result, the
vwd group remains solidly financed.

Risks: few changes
A new risk and opportunity review has found no new changes related to the
statements contained in the Annual Report 2009.

Outlook: business recovery expected beginning in 2011
While the vwd group continues to believe it is well positioned in the
current fiscal year, the company expects that it will be unable to generate
growth due to business conditions. As a result, sales and earnings are
projected to decrease. Beginning with fiscal year 2011, the vwd group
expects to experience a strong rebound in business. Working in an improved
macroeconomic environment, the company sees new potential for growth next
fiscal year. vwd's business will be able to profit from new regulatory
initiatives by the EU and national governments. The introduction of more
transparency and risk optimization in the investment process, a goal of
investor-protection efforts, will facilitate the use of IT-based systems.
The vwd group is already preparing for these changes.

Frankfurt am Main, May 2010

vwd Vereinigte Wirtschaftsdienste AG
The Management Board

Forward-looking statements:
This interim statement contains forward-looking statements that reflect the
current views, expectations and assumptions of the vwd group and are based
on the information available to the company at the time of its preparation.
Forward-looking statements cannot guarantee that results and developments
will actually occur in the future, but are subject to risks and
uncertainties. Different factors may cause the future results and
development of the vwd group to deviate substantially from the expectations
and assumptions formulated in this statement. Changes in general economic
conditions, new legal parameters, the competitive situation and financial
market developments, in particular, can impact future results and
developments.

Additional information:
vwd Vereinigte Wirtschaftsdienste AG
Tilsiter StraÃe 1
60487 Frankfurt am Main
www.vwd.com

Investor Relations
Carsten Scharf
Telephone: +49 69 50701-270
Fax: +49 69 50701-114
E-mail: investorrelations@vwd.com

Profile vwd group:
vwd group offers customised information, communications and technology
solutions for the financial markets. As a leading European provider, it
specialises in meeting individual customer requirements in the areas of
asset management, retail banking, private banking and wealth management. It
offers innovative solutions for financial service providers, investors and
the media. vwd's business is driven by innovation, flexibility, customer
centricity and strong commitment to local needs. With around 430 employees
at 15 locations in 5 countries vwd is a public company, listed at the
Frankfurt Stock Exchange. The group's best-known brands are:
finanztreff.de, vwd fonds service, vwd market manager, vwd portfolio
manager, vwd PortfolioNet, TradeLink and Tai-Pan.

12.05.2010 09:01 Ad hoc announcement, Financial News and Media Release distributed by DGAP. Medienarchiv at |[![CDATA[|[a href="http://www.dgap-medientreff.de"|]www.dgap-medientreff.de|[/a|]]]|] and |[![CDATA[|[a href="http://www.dgap.de"|]www.dgap.de|[/a|]]]|]

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Language: English
Company: vwd Vereinigte Wirtschaftsdienste AG
Tilsiter StraÃe 1
60487 Frankfurt am Main
Deutschland
Internet: http://www.vwd.com

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