- Portfolio making good progress
- Fall in stock market prices impacting value growth
- 2015/2016 forecast concretised
- New format for quarterly reports
Frankfurt am Main, 11 February 2016. As preliminarily announced on 19 January 2016, Deutsche Beteiligungs AG ended the first quarter of its 2015/2016 financial year posting very gratifying results: net income reached 30.8 million euros. In the comparative quarter of the previous financial year, net income totalled 13.2 million euros, and 27.0 million euros were recorded for the full 2014/2015 financial year. A chief driver of the unexpectedly high quarterly income were unforecastable contributions to the net result of investment activity from divestments; this item significantly determines DBAG’s net income.
In addition to the divestment of the Spheros Group, the net result of investment activity was also fuelled by a further realisation: one of the two international buyout funds, in which DBAG has been invested since 2003, agreed the sale of an investment from its portfolio. These two transactions contributed about ten million euros towards the quarterly result. Valuation gains on the other companies in the DBAG portfolio were, in total, also greater than expected, after individual portfolio companies, particularly ones that had recently been acquired, reported surprisingly good financials at year-end 2015.
In view of their very satisfactory order levels and positive market expectations, nearly all of the companies in the portfolio of Deutsche Beteiligungs AG have budgeted revenue growth and higher earnings. That leads to valuation uplifts against the preceding reporting date and, consequently, to a positive net result of investment activity. The stock market impact had already begun to turn negative at the period end on 31 December 2015, due to partially lower valuation multiples: the gross result of valuation and disposal contains negative valuation movements of more than ten million euros as a result of lower stock market multiples.
Net asset value per share was 24.41 euros at 31 December 2015, a rise of 2.25 euros compared with the beginning of the financial year. Relative to the opening net asset value at the onset of the financial year, less the proposed dividend payment, this represents a gain of 10.6 percent. In the first quarter of the previous 2014/2015 financial year, net asset value per share grew by 5.0 percent.
DBAG has for the first time issued a Quarterly Statement at the current reporting date, which was initially promulgated by the European and German legislature and, subsequently, by Deutsche Börse. Instead of comprehensive interim reports, which are no longer required for the first and third quarters, quarterly statements are appropriate to inform the stock market about the company’s performance in the relevant reporting period. To that end, DBAG developed a new format. “We believe that this presentation offers clarity and will serve the interests of our shareholders and other stock market participants. Our Quarterly Statement is shorter, more concise and focused on the essence,” said CFO Susanne Zeidler on presenting the financials today.
“The result of the first quarter exceeds our expectations and our forecast,” said Spokesman of the Board of Management Torsten Grede. DBAG has therefore now concretised the forecast: as previously projected, net income, on a comparable basis, is expected to significantly exceed that of the previous year (25.2 million euros). Added to that is the profit from divestments of approximately ten million euros.
The Quarterly Statement drew attention to the fact that negative changes have taken place since the period end at 31 December 2015: valuation ratios in the stock markets have taken a downturn. Moreover, in the opinion of the Board of Management, cyclical risk has increased at least for those portfolio companies that manufacture and globally market capital goods.