Bellevue | Küsnacht, 29.02.2016.
Bellevue Group operating profit sharply higher at CHF 24.6 million – assets under management reach new record high
• Group operating profit up 85% to CHF 24.6 million
• Increase in assets under management of 14% to CHF 5.3 billion
• Asset Management result improves by 56% to CHF 24.0 million
• Bank am Bellevue’s operating profit CHF 4.1 million thanks to special dividend from SIX
•Net loss of CHF 0.8 million at Group level following impairments in first half-year
• Proposed dividend per share of CHF 1.00
The stock market fluctuations of 2015 will leave many investors with mixed feelings. Most recently, the striking factor was the increase in market volatility worldwide. While the continuation of loose monetary policy may have offset the faltering global economy, the fundamental challenges are still to be addressed. In the face of general low economic growth, the slowdown of growth engine China takes on more important dimensions. Investor confidence was also damaged by geopolitical risks in Russia and the Middle East.
Significant improvement in operating profit and recurring income
Despite the challenging environment, Bellevue Group’s profitability has continued to improve. Fee and commission business – the Group’s main source of income – grew considerably by 41% to CHF 70.6 million (previous year: CHF 50.1 million). Bellevue Asset Management’s contribution to the improvement in the result was crucial, achieving new record income with an increase of around 63%. Bank am Bellevue’s income also rose slightly thanks to the special dividend of CHF 4.5 million from SIX Group Ltd.
In line with the very positive trend in operating performance, the entrepreneurial compensation model led to higher salary expenses, with an increase of staff from 78 to 87. Total expenses rose by 34%, but at a much slower pace then the increase in income. Overall, the Group achieved an operating profit of CHF 24.6 million in 2015 – an 85% improvement over the previous year (CHF 13.3 million). This strong operating performance was affected by extraordinary impairments in the first half-year. Revenue erosion in the Brokerage unit caused the Bank to revise the future profit potential, which resulted in impairments and write-offs of CHF 24.7 million to goodwill and intangible assets in the balance sheet. In the second half of 2015, Bellevue Group was able to increase the momentum for growth. That reduced the net loss to CHF 0.8 million at the Group level (previous year profit: CHF 11.1 million) after consideration of seed capital, depreciation, amortisation and impairments, and taxes.
“In 2015, Bellevue Group continued to strengthen the foundations for robust development of the business. The strategic focus on recurring revenue is gradually bearing fruit, as current results clearly demonstrate. We want to build on this regained strong performance, particularly in Asset Management to implement the growth and diversification strategy efficiently. We are concentrating our attention on reinvigorating the Bank. We are confident that this year we will be able to take our first steps towards broadening the Bank’s business activities,” comments André Rüegg, CEO of Bellevue Group, with regard to the 2015 results.
Asset Management income at new record high and continued growth in assets under management
Based on continuing success with BB Biotech AG and on the first full-year contribution from Adamant Biomedical Investments AG, the Asset Management achieved sustainable increases in revenues and helped to diversify the income stream. The share of income arising from sources other than the BB Biotech area is growing steadily and amounts to well over a third. Client assets under management rose to a new record high of CHF 5.3 billion during the reporting year, representing a significant increase of 14% over the previous year (CHF 4.7 billion). Above-average investment performance from a number of products was once again the key driver behind this solid growth, despite a volatile market environment and major currency fluctuations. BB Biotech’s performance, at 28.2%, surpassed the benchmark by more than 16%. In the healthcare sector, the BB Adamant Global Healthcare Index Fund beat the benchmark index with its performance of 11.6%. The niche strategy funds BB Entrepreneur Switzerland and Europe generated added value for their investors with investment results of 6.4% and 14.1%, respectively, and outperformed their benchmarks. The BB Global Macro Fund completes Bellevue Asset Management’s picture of strong performers, with a return of 6.1%. The internationally renowned investment expertise at Bellevue Asset Management attracted the record amount of around CHF 540 million in new money from private and institutional investors. Redemptions due to profit-taking completely offset the new funds raised. Bellevue Asset Management improved its result by 56% to CHF 24.0 million, underpinned by the marked increase in assets under management.
Bank am Bellevue: Corporate Finance gains in importance – tailwind from special dividend
There was strong demand for the Corporate Finance team’s expertise in M&A and capital markets during 2015. Bank am Bellevue recently acted as co-lead manager in the stock market debut of Cassiopea, a Cosmo Pharmaceuticals subsidiary. Overall, Corporate Finance achieved a year-on-year increase in income of 67%. This positive trend was nevertheless overshadowed by a slowdown in brokerage business and led to a fall in commission income of around 8%. Institutional investors remained hesitant even though each of the research team’s share recommendations and the quarterly selection of the top five clearly outperformed the SMI (–1.8%) with yields of 11.5% and 11.7%, respectively. The Bank’s innovative strength was demonstrated by the introduction of structured products. A special dividend payment from SIX Group Ltd positively influenced the Bank’s annual result, which showed an operating profit of CHF 4.1 million (previous year: CHF 2.3 million).
Shareholder-friendly dividend policy
The Board of Directors will propose an unchanged dividend of CHF 1.00 per registered share at the forthcoming Annual General Meeting. This continues the shareholder-friendly dividend policy.
Acquisition of StarCapital AG brings expanded know-how and increased income
The acquisition of the independent German asset manager StarCapital AG, which was announced on 23 February 2016, continues Bellevue Group’s targeted diversification into new asset classes and expansion of its product range in non-healthcare sectors. StarCapital manages assets of around CHF 2.5 billion, and its expertise in balanced investments and fixed income strategies is well known. To complete the planned acquisition of StarCapital and to maintain Bellevue Group’s strategic flexibility in line with its forward strategy, the company plans a rights offering during the second quarter of 2016 to increase capital by CHF 30 to 40 million.
A full copy of the 2015 annual report can be viewed at www.bellevue.ch
Contact
Media/Investor Relations: Daniel Koller, CFO
Telephone +41 44 267 67 00, fax +41 44 267 67 01, ir@bellevue.ch
Financial Calendar 2016
22 March 2016 Annual General Meeting 2016
29 July 2016 Publication of half-year report 2016
Bellevue Group
Bellevue Group is an independent Swiss financial boutique listed on the SIX Swiss Exchange. Established in 1993, the company and its approximately 90 employees are specialists in the fields of Brokerage, Corporate Finance and Asset Management. Bellevue Group includes the two subsidiaries Bank am Bellevue and Bellevue Asset Management. The Bank boasts superb knowledge of the Swiss stock and bond market and offers independent research opinions and recommendations as well as viable solutions for capital market transactions. Bellevue Asset Management is focused on selected active equity investment strategies in growing markets, in health care industries as well as in other special themes such as entrepreneur-led companies.
This publication shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of securities referred to herein in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration, exemption from registration or qualification under the securities laws of any such jurisdiction. The securities referred to herein have not been and will not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”), and may not be offered or sold in the United States or to U.S. persons (as such term is defined in Regulation S under the Securities Act) absent registration or an exemption from registration under the Securities Act. The issuer of the securities has not registered, and does not intend to register, any portion of the offering in the United States, and does not intend to conduct a public offering of securities in the United States.
This publication constitutes neither an offer to sell nor a solicitation to buy securities of Bellevue Group and it does not constitute a prospectus within the meaning of article 652a and/or 1156 of the Swiss Code of Obligations or a listing prospectus within the meaning of the listing rules of the SIX Swiss Exchange. The offer will be made solely by means of, and on the basis of, an offering circular and listing prospectus which is to be published. An investment decision regarding the publicly offered securities of Bellevue Group should only be made on the basis of the offering circular and listing prospectus.
