Financial Services Technologies

Transcription

1 CORPORATE PRESENTATION FinTech Group AG February 2019 Financial Services Technologies We got IT

2 Operational key figures and guidance 2019e

3 Operational key figures at a glance* Number of Customers Number of exchanges and OTC-partners Executed Trades Executed Trade Volume Securities under Custody Customer Cash Deposits B2C B2B 275 k > m EUR > 40 bn EUR 12.1 bn EUR 931 m Credit Book (collateralized) Average Interest Rate (Loan Book) TIER-1 Capital Return on Equity p.a. (before Tax 2017) Offices Berlin Willich Neuss Dusseldorf Zwickau Andernach Kulmbach Frankfurt a.m. Vienna (HQ) Employees EUR 195 m 4.5 % p.a. EUR 54.1 m 25 % * As of

4 Our guidance 2019e 138 EUR million revenues 27 % EBITDA Margin (post growth investments) (34 % EBITDA Margin / pre growth investments) 4

5 Track record and guidance 2019e Acquisition of service provider XCOM/biw to control cost structure and set-up tech inhouse expertise Implemented high class management team and subsequent restructuring actions Sold CeFDex to Commerzbank to reduce risk structure (strategic partnership) 22.7 Restructuring of group operations and implementation of IFRS Reporting Boost of organic growth of existing B2C business Implement technology based lending and redeveloping treasury with the potential to generate an additional EUR 10+ million Improved B2C product portfolio with Morgan Stanley ETP partnership Reorganisation of Group structure and new segmentation into Fin and Tech units Increased investor relations activities Implementing B2B strategy: the standard banking platform for private and specialist banks 16.8 >120.0 >138.0 >40.0 > 27% >24.0 o Continue strong growth of number of settled transactions o International Expansion flatex goes Europe EUR million Net Sales EBITDA Net Profit a 2017a 2018e 2019e 5

6 FinTech Group - Executive Committee Jörn Engelmann CRO FinTech Group Bank (since Feb 2019) Jens Möbitz Head Back Office MD FinTech Group Bank (since Sep 2018) Steffen Jentsch Stephan Simmang Dr. Benon Janos Frank Niehage Muhamad Chahrour Niklas Helmreich Co-Head IT MD FinTech Group Bank Co-Head IT Head B2B MD FinTech Group Bank CEO FinTech Group CEO FinTech Group Bank CFO FinTech Group MD FinTech Group Bank Head B2C MD FinTech Group Bank ALL EXCO MEMBERS ARE PART OF THE FOUR-YEAR OPTION PLAN 6

7 Business Model

8 Key Issues in Banking Digitisation increases the pressure on integration of customers and processes: Despite the support of top management, many companies have not developed an overall strategy yet Start-ups: New competitors in the market lead to a decomposition of the value chain in banking Business Analytics is gaining importance in sales: More soft customer data (from more sources) exploiting the potential of customer data and more effective customisation of products Cost structures to the test: The majority of banks are reviewing their cost structure - one focus is IT and possible consolidations Regulatory: The banking supervision s (ECB, NFSA) demand on the management of banks are increasing (IT security law, MIFID II, etc.) Growing market demands affect all banks equally. The developed solutions here in the undifferentiated area will help banks to focus on their core competencies in banking 8

9 B2C - business model of flatex and ViTrade (c75% REVENUE CONTRIBUTION, c35% EBITDA MARGIN) Self-developed core banking system (FTG:CBS) with outstanding expertise in transaction banking and fully fledge bank with automatised settlement and clearing processes Fastest growing online brokerage business in Germany and Austria, >280k retail clients doing >12m transactions with notional amount of >EUR 75bn p.a. Market share of >25% in Germany and >50% in Austria in terms of online brokerage transactions (total est. # of transactions: 50-55m in Germany, 2-3m in Austria) Most trading-active client pool in the brokerage market (FinTech clients: avg trades p.a. vs. market: avg trades p.a.) Dedicated brokerage offering with focused marketing strategy minimises operating expenses (cost per client acquisition EUR 100 vs. EUR CPA at competitors) 9

10 flatex impressions 10

11 B2C - our competitive edge: the triple P Price Unlimited trading possibilities with a flat pricing model of EUR 5.90 per transaction regardless of type of asset (stocks, bonds, ETPs, ETFs etc.) and transaction amount Competitive technology edge due to self-developed, highly scalable security ordering/ settlement infrastructure ensures sustainable cost leadership with cost per trade (CPT) of currently EUR 1.44 Top notch product offering including equities, bonds, ETPs, ETFs and mutual funds Product Market leading ETP offering of Morgan Stanley, Deutsche Bank, Goldman Sachs, UBS, BNP Paribas, HSBC, Vontobel, and other products Economies of scale: each additional trade reduces cost per trade settlement doubling the # of transactions reduces CPT by >40% Platform Trading platform only no research, recommendation or intelligence avoiding regulatory administration and costs Designed by traders for traders 11

12 Source: FinTech Group Source: FinTech Group B2C - development of brokerage KPIs Growing Number of Brokerage Customers (thousand) Total Number of Trades FTG Bank (million) FY 2014 FY 2015 FY 2016 FY FY 2014 FY 2015 FY 2016 FY FY 2018e 12

13 B2C maturity profile of our trading customers 25 % of the trades representing customers who are inbetween 1-3 years with FTG 12 % of the trades representing customers who are less than a year with FTG 63 % of the trades representing customers who are more than three years with FTG 13

14 B2C split of total number of trades Exchange Traded Funds 17% Shares and Bonds 37% Exchange Traded Products, FX/Commodities/CFD etc. 47% 14

15 B2C-case study: Morgan Stanley ETP / 1st market disruption German ETP market size notional of around EUR 70bn pa - FinTech Group with >15% distribution stake In the past: product issuing banks kept 90% of the revenue pool - 10% to product distributor Already 50,000 flatex-select products issued by Morgan Stanley that clients can trade at no cost BANKS ISSUE ETPs OFFERED AT FLATEX TRADED BY CLIENTS Market standard in the past: Partnerships today: 90 : 10 split 50 : 50 split REVENUE POOL Revenue generation for issuing bank through: Inherent interest component Bid-ask spread 15

16 ETP Premium Partner Pricing Model / 2nd market disruption 16

17 B2C-volatility is key driver of transactions and revenues Volatility has reawakened after reaching 20-year record low in 2017 with significant upside potential - resulting in two consecutive record months Jan and Feb 2018 (+40% transactions compared to same period 2017) with strong revenue effect HIGH CORRELATION BETWEEN MARKET VOLATILITY AND CLIENTS ACTIVITY WITH STRONG UPSIDE POTENTIAL Brexit vote Trump election Jan/Feb 2018 Italian Budget Increase in volatility led to record transaction number of >2 million in Jan/Feb % vs. Jan/Feb 2017 Trades / Total # of clients FinTech Group AG VDAX 17

18 flatex goes international flatex today First priority H1 2019e 18

19 B2B - fully modular self-developed core banking platform (c25% REVENUE CONTRIBUTION, c20% EBITDA MARGIN) Layers within the FTG:CBS banking platform Technology Sales Platform OADO Online branch Entax-BO-Client HTML Objektive-c (ios) Mobile App CRM / Sales Trading FE Java (Android) REST / SOAP Production Platform Regulatory & Steering Platform Support Platform Account/Depot Srv. APIs Securities Payment Service Cards Deposit Transaction Service Credit Facilitation Master Data Accounting Controlling Tax Compliance Regulat. Reporting (Abacus) ABACUS Ticketing InfoZone / WM Mgmt. Reporting DWH / BI Risk / Liq. Mgmt APIs Batchdata Shared Services Service Portal Archive HA Wildfly Java, Go C++ SAP ASE Wildfly Java C++ SAP ASE PostgreSQL Oracle ASCII, XLS / SFTP FIX / EBICS /SWIFT 19

20 B2B - shared services: banking processes and platform POSITION FINTECH GROUP S BANKING PLATFORM AS THE STANDARD PLATFORM FOR PRIVATE AND SPECIALIST BANKS Regulatory Umbrella Application Use Cases Fintech Start-ups flatex Broker FinTech Group Bank BPO Banks Corporates Payment Instutions API Layer API API FinTech Group Platform Software + Banking FinTech Group Data centre Financial System Infrastructure DATA CENTRES ISO SEPA SWIFT EXCHANGES 20

21 B2B - client excerpt and case studies Unique combination of technology and banking know-how enables our clients to build top-class financial products and services Key partner Notable clients FinTech Group was chosen to set-up the technological infrastructure for digital online retail banks in Germany and Austria including providing several respective regulatory banking processes FinTech Group AG developed, maintains and runs LOX, the ETP OTC system for Deutsche Bank AG and Commerzbank AG - 3bn price feeds and 50k transactions - per day. FinTech Group Bank AG were chosen by Equatex - one of the leading European stock option plan administrators with >3bn EUR AuC to provide banking and custody services; opening 250k accounts in 4 weeks. FinTech Group AG is the central IT service provider for the Federal Association of German Banks, providing key technology platform to run the German Deposit Guarantee Scheme. 21

22 Investment case

23 The ecosystem unique combination of independent business models B2B Customer lifetime: 5-10 years Highly predictable revenue streams Increase interaction with and offering to clients Leverage self-developed infrastructure Manifest customer relationship Reduce costs per unit B2C High margin business Transaction driven business CAPEX driven GROWTH Increase profitability and cash flow Broad customer base Access to new products and services Continuous development of technology and platform 23

24 Annex

25 FinTech Group AG - corporate structure Tech-Entity 100% FTG Finanz GmbH 100% Fin-Entity 25

26 FinTech Group AG - key milestones Company founded in Langen L.O.X. OTC certificate platform developed (limit order system connects DB/Coba flow to 22 pan-european brokers) Full BPO IT provider for bankenverband ever since Full white label Retail Bank operations begins (full BPO) 2001 Development and full BPO provider for pan-european expansion (core bank system FTG:CBS:R1 is born) 2015 Migration of mwb fairtrade from caceis to FinTech Group Bank for order routing and securities settlement (1.4 m trades/year) Best German online broker goes live Large Austrian bank selected FinTech Group as full BPO for Austrian and German digital expansion 26

27 FinTech Group AG - shareholder structure* ) Free Float of 58.6 %, therein: Management of the Group ~ 7% * ) No. of shares outstanding: 18,955, % GFBK (Entity of flatex founder Bernd Förtsch) 10.5 % 58.6 % 6.5 % 27

28 FinTech Group AG - our stock Shares outstanding: 18,955,637 Options outstanding: max. 1.1m Market capitalisation: EUR 400m (as at ) Listed: ISIN: Open Market / SCALE Deutsche Börse / Frankfurt Stock Exchange DE000FTG1111 Share Price (EUR) STOCKPRICE DEVELOPMENT LTM Jan 2019 PT EUR Buy Berenberg Jan 2019 PT EUR Buy Commerzbank Bloomberg: FTK GR Equity Jan 2019 PT EUR Buy Hauck & Aufhäuser Stock covered by Jan 2019 PT EUR Buy M.M. Warburg 28

29 Financial Calendar 2019 Contact details Corporate Events 2019 Jun 27 Annual Report 2018 Aug Annual General Meeting / Frankfurt/Main Sep 30 Half-Year Interim Report 2019 Investors Conferences 2019 Mar 14 Berenberg Madrid Seminar Investors Conference / Madrid (ES) Apr 1-3 Raiffeisen Centrobank Investors Conference / Zürs (CH) May Equity Forum Spring Conference / Frankfurt/Main May Berenberg US Conference / Tarrytown NY (USA) Jun 5-7 Goldman Sachs European Financials Conference / Paris (F) Sep Berenberg / Goldman Sachs German Corp. Conf. / Munich Jörg Peters FinTech Group AG IR & Press Rotfeder-Ring 7 D Frankfurt/Main, Germany Phone: Mobile: joerg.peters@fintechgroup.com