eQ PLC HALF YEAR FINANCIAL REPORT
14 August 2018 at 8:00 AM
January to June 2018 in brief
- During the period under review, the Group's net revenue totalled EUR 20.4 million (EUR 18.8 million from 1 Jan. to 30 June 2017).
- The Group’s net fee and commission income was EUR 19.2 million (EUR 18.3 million).
- The Group’s net investment income from own investment operations was EUR 1.2 million (EUR 0.5 million).
- The Group’s operating profit grew by 9% to EUR 9.5 million (EUR 8.7 million).
- The Group’s profit was EUR 7.5 million (EUR 6.9 million).
- The consolidated earnings per share were EUR 0.20 (EUR 0.19).
- The net cash flow from the Group’s own private equity fund investment operations was EUR 1.7 million (EUR 0.1 million).
- The net revenue of the Asset Management segment increased by 9% to EUR 17.5 million (EUR 16.0 million) and the operating profit by 10% to EUR 9.0 million (EUR 8.2 million).
- The net revenue of the Corporate Finance segment fell to EUR 1.8 million (EUR 2.3 million). It is typical of corporate finance business that success fees have a considerable impact on invoicing, due to which the result of the segment may vary considerably.
April to June 2018 in brief
- In the second quarter, the Group’s net revenue totalled EUR 10.8 million (EUR 9.4 million from 1 April to 30 June 2017).
- The Group’s net fee and commission income was EUR 10.3 million (EUR 9.1 million).
- The Group’s net investment income from own investment operations was EUR 0.5 million (EUR 0.3 million).
- The Group’s operating profit grew by 15% to EUR 5.1 million (EUR 4.4 million).
- The Group’s profit was EUR 4.0 million (EUR 3.5 million).
- The consolidated earnings per share were EUR 0.11 (EUR 0.09).
| Key ratios | 1-6/18 | 1-6/17 | Change % | 4-6/18 | 4-6/17 | Change % | 1-12/17 |
| Net revenue, Group, M€ | 20.4 | 18.8 | 9% | 10.8 | 9.4 | 15% | 40.7 |
| Net revenue, Asset Management, M€ | 17.5 | 16.0 | 9% | 9.0 | 8.0 | 12% | 33.9 |
| Net revenue, Corporate Finance, M€ | 1.8 | 2.3 | -25% | 1.3 | 1.1 | 19% | 5.2 |
| Net revenue, Investments, M€ | 1.2 | 0.3 | 283% | 0.5 | 0.2 | 150% | 1.4 |
| Net revenue, Group administration and | |||||||
| eliminations, M€ | 0.0 | 0.1 | 0.0 | 0.1 | 0.1 | ||
| Operating profit, Group, M€ | 9.5 | 8.7 | 9% | 5.1 | 4.4 | 15% | 20.1 |
| Operating profit, Asset Management, M€ | 9.0 | 8.2 | 10% | 4.7 | 4.2 | 12% | 18.0 |
| Operating profit, Corporate Finance, M€ | 0.4 | 0.8 | -53% | 0.5 | 0.4 | 46% | 2.0 |
| Operating profit, Investments, M€ | 1.2 | 0.3 | 283% | 0.5 | 0.2 | 150% | 1.4 |
| Operating profit, Group administration, M€ | -1.1 | -0.6 | 70% | -0.6 | -0.3 | 109% | -1.3 |
| Profit for the period, M€ | 7.5 | 6.9 | 10% | 4.0 | 3.5 | 16% | 15.9 |
| Key ratios | 1-6/18 | 1-6/17 | Change % | 4-6/18 | 4-6/17 | Change % | 1-12/17 |
| Earnings per share, € | 0.20 | 0.19 | 8% | 0.11 | 0.09 | 14% | 0.43 |
| Equity per share, € | 1.37 | 1.45 | -6% | 1.37 | 1.45 | -6% | 1.67 |
| Cost/income ratio, Group, % | 53.5 | 53.6 | 0% | 52.9 | 52.8 | 0% | 50.5 |
| Liquid assets, M€ | 9.2 | 5.3 | 75% | 9.2 | 5.3 | 75% | 24.7 |
| Private equity fund investments, M€ | 18.4 | 20.5 | -10% | 18.4 | 20.5 | -10% | 18.8 |
| Interest-bearing liabilities, M€ | 0.0 | 0.0 | 0% | 0.0 | 0.0 | 0% | 0.0 |
| Assets under management, € billion | 8.9 | 9.6 | -7% | 8.9 | 9.6 | -7% | 8.4 |
Janne Larma, CEO
The net revenue of the Group grew by 9% to EUR 20.4 million and the operating profit by 9% to EUR 9.5 million. The Group’s profit increased to EUR 7.5 million, i.e. by 10%.
The strong growth of eQ Asset Management’s management fees continued
eQ Asset Management continued with its solid growth and improved once more its result. eQ Asset Management’s rolling 12-month net revenue and operating profit have already grown for 22 consecutive quarters. The net revenue of the Asset Management segment increased by 9% to EUR 17.5 million and the operating profit grew by 10% to EUR 9.0 million. During the year under review, management fees have grown by more than 25%, and their share of the total fee and commission income exceeded 90%. Growth is still driven by real estate and private equity asset management, the administrative fees of which grew by 37%. Net subscriptions in eQ’s real estate funds have been record high this year, i.e. EUR 211 million. Interest in private equity asset management also continued to be good. The third close of the eQ PE X North private equity fund took place in June at EUR 141 million and the third close of the eQ PE SF II private equity fund at EUR 98 million. Within traditional asset management, the returns of the funds managed by eQ have been good. During an investment period of three years, 64% of the funds managed by eQ have surpassed their benchmark indices. We believe that our product portfolio is very well suited to the present market situation, and this combined with our good past returns will give us good operating preconditions in future as well.
Advium’s second quarter at last year’s level
During the six-month period, Avdium acted as advisor in four executed transactions. Advium acted as advisor as Maksuturva was sold to Svea Ekonomi and as Kalatukku E. Eriksson was sold to Kesko, for instance. Advium’s net revenue fell from the year before to EUR 1.8 million (EUR 2.3 million) and its operating profit fell to EUR 0.4 million (EUR 0.8 million). Great variations in fees per quarter are typical of corporate finance operations. In corporate and real estate transactions, the market situation continues to be good, and we believe that it will remain good during the remaining part of the year as well.
The result of the Investments segment improved markedly
The net revenue and operating profit of the Investments segment increased from the year before to EUR 1.2 million (EUR 0.3 million). During the period under review, the net cash flow from investments was EUR 1.7 million (EUR 0.1 million). The fair value of the private equity fund investments was EUR 18.4 million (EUR 18.8 million on 31 December 2017).
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eQ’s half year financial report 1 January to 30 June 2018 is enclosed to this release and it is also available on the company website at www.eQ.fi.
Additional information: Janne Larma, CEO, tel. +358 9 6817 8920
Distribution: Nasdaq Helsinki, www.eQ.fi, media
eQ Group is a group of companies that concentrates on asset management and corporate finance business. eQ Asset Management offers a wide range of asset management services (including private equity funds and real estate asset management) for institutions and private individuals. The assets managed by the Group total approximately EUR 8.9 billion. Advium Corporate Finance, which is part of the Group, offers services related to mergers and acquisitions, real estate transactions and equity capital markets.
More information about the Group is available on our website www.eQ.fi.
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