Financial Services Technologies

Transcription

1 Corporate Presentation, Frank Niehage, CEO Financial Services Technologies The leading European infrastructure provider and operator April 2016

2 Table of contents 1. About us 2. Corporate strategy 3. Strategic partnerships 4. Annex 2

3 1. About us: key facts and operational figures Customer cash deposits approx. EUR 1bn Number of own B2C Customers approx. 200k Number of inst. B2B Clients approx. 250 Assets under Admin. (biw AG) approx. EUR 5.5bn Trades executed p.a. approx. 10m (forecast based on H figures) Tier 1 Capital approx. EUR 60m CRR indicator > 16 Headquarters Frankfurt, Germany Other locations Berlin, Düsseldorf, Kulmbach, Willich, Andernach, Zwickau Employees approx. 500 Investors (two of them listed) GfBk Gesellschaft für Börsenkommunikation mbh (40.10%) Heliad Equity Partners (listed on the Frankfurt Stock Exchange) (17.75%) SafeCharge International Group Ltd. (listed on London AIM) (4.82%) Others (incl. free float) (37.33%) 3

4 About us: key facts and operational figures Shares outstanding: 16.8m Stockprice development Options outstanding: max. 1.7m shareholder return LTM: 66% Market Cap: EUR 290m (18/04/2016 share price EUR 17.45) Share Price (EUR) ISIN: DE Bloomberg: FLA GY Equity Reasonable daily trading volume Approx. EUR 250k/day Stock covered by Jul 2015 PT EUR H&A Nov 2015 PT EUR Mirabaud Securities Feb 2016 PT EUR H&A Latest price target range of EUR 4

5 1. About us: increase in customers Steady and organic B2C growth Increasing share of wallet Asset volume of EUR 35,000 per customer on average A growing number of customers Development of assets under administration (million EUR) 118,17 126, , , , , ,646 2,171 2,347 2,810 3,527 4,023 5, ,086 FY 2012 FY 2013 FY 2014 HY 2015 FY 2015e FY 2016e FY 2017e Source: FinTech Group FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY HY 2015 Source: FinTech Group 5

6 1. About us: full-year results¹ 2015 underpins growth strategy with strong indicative FY15 results Indicative EBITDA under German IFRS of EUR 19m in FY 2015 XCOM AG fully consolidated for the first time following integration in second quarter Number of executed transactions sets record high (The number of trades executed rose to 10.1 million in FY 2015) biw AG develops lending business following bolstering of capital The innovative credit line flatex flex, an alternative to usually expensive overdraft facilities of other German banks, meets high demand Strategic partnership between and allows for significantly higher profit stake in the ETP business (1) pre-audit results 6

7 1. About us: guidance Development of net revenues, EBITDA and EBITDA margin Net revenues (million EUR) EBITDA (million EUR) EBITDA margin % 23.5% % -8.0 FY 2014 FY 2015e FY 2016e 7

8 1. About us: our business model at a glance B2B Business B2C Business Technology and white-label banking business for third parties Business models operated by FinTech Group AG under own brands Leading provider of software and technology solutions for banks and financial services companies in Europe with more than 250 clients B2B Brands B2C Brands Renowned, third largest online broker in Germany with flat fee trading model Approx. 150,000 customers Strong brand in Germany European expansion in progress Continuous product development German BaFin licensed bank with full range of white label banking services Professional trading for highly active investors (EU-Passport) kesh: mobile payment system benk: B2C online bank with a large porfolio of products 8

9 1. About us: B2B service portfolio Leading provider of software and technology solutions for banks and financial services companies in Europe with more than 250 clients German BaFin licensed bank with full range of white label banking services (EU Passport) Trading Trading system Market maker system Trading platforms Market and price data supply E-Banking Payment platform SEPA platform incl. mandate management Online banking Secure transactions Payment Payment services (physical and electronic) Mobile payment "kesh" Card processing ATM operations (incl. mobile payment) Banking Business process outsourcing (whitelabeling) Core banking Reporting systems (client, regulatory, etc.) 9

10 1. About us: company history Incorporation of PRE.IPO AG in Kulmbach Change of name to flatex AG Start of CFD-Trading IPO flatex AG Aktionärsbank GmbH obtains banking license flatex Holding AG FinTech Group AG Take-over of strategic majority in XCOM AG Acquisition of CeFDex (100%) New Senior Management Significant acceleration Incorporation of XCOM BCC in Langen Merger of 12 group companies XCOM AG Acquisition of XCOM-Bank Incorporation of Bank biw AG (minority stake in the beginning) Investment in ViTrade AG Full take-over of Bank biw AG (100%) New owner 10

11 1. About us: current organistional chart 100% 100% 67% 2,25% 0,75% (SPV) Via XCOM Finanz GmbH (100%) 100% 100% As of April

12 1. About us: ongoing transformation process Past Present Future Only one relevant shareholder, no relevant free float Business model focused on online brokerage (B2C) Limited strategic partnerships DACH focus only; no strategic partnerships More diversified shareholder structure, no majorities left, relevant free float Running B2B and B2C businesses with enormous growth potential Already 2 strategic partnerships signed in 2015 DACH focus, first internationalization steps Diversified shareholder structure and strong free float B2B and B2C innovation engine based on stable and recurring businesses Further operational / equity / strategic partnerships European market leader within the FinTech infrastructure segment 12

13 1. About us: future organisational chart 100% 100% uses liability umbrella of biw % 100% B2C - currently online brokerage B2B IT services B2B Banking services Peers of FinTech Group 13

14 1. About us: senior management Frank Niehage CEO (since ) Vast experience across all segments of retail and commercial banking. Previously a Managing Director at Goldman Sachs. He was also instrumental in the growth of Bank Sarasin AG as CEO in Germany. Martin Korbmacher Chairman of the Supervisory Board (since ) Extensive expertise in both traditional banking and financial services technologies. Previously Global Head of Equities at Dresdner Kleinwort and Investment Banking Head of Germany and Austria for Credit Suisse ( ) 14

15 1. About us: executive committee Frank Niehage CEO FTG Chairman Executive Committee FTG Chairman XCOM AG Chairman biw AG Sascha Bochartz Muhamad Chahrour Niklas Helmreich Dr. Benon Janos Stefan Müller Bernd Würfel Head IT FTG Board Member XCOM AG Head Finance FTG Board Member XCOM AG Head B2C FTG CEO flatex CEO ViTrade Board Member XCOM AG Head B2B FTG Chief Representative FTG Board Member XCOM AG Head Regulatory FTG Chief Representative FTG Chairman biw AG CEO biw AG CEO Aktionärsbank Board Member XCOM AG 15

16 2. Corporate strategy

17 2. Corporate strategy: our ambition Our goal To be the platform and infrastructure provider of choice for the financial service industry in Europe To become one of the leading, highly profitable FinTech companies in Europe Strategic steps (1) restructuring of the existing B2C business (DONE) + (2) new business line B2B (DONE) + (3) strategic acquisitions and new B2C lines (DONE & ONGOING) + (4) boost of organic growth of existing B2C business (IN PROGRESS) Gearing up to make full use of Group synergies one firm We set up an Executive Committee with members from across all of the Group s entities to ensure a continuous exchange amongst management personnel We also created a Resource & Priority Committee ( integration task force ) to create extensive synergies and achieve maximum efficiency has been awarded the (rare) status of leading company ( übergeordnetes Institut ) for regulatory purposes by the German authorities (BaFin) despite not holding a bank license itself 17

18 2. Corporate strategy: roadmap next 24 months 1 Last 12 months TODAY Next months Fixed agenda Additional upside 22.7 Improved tech expertise by Xcom acquisition Strengthened capital base Implemented high class management team and subsequent restructuring actions Closed CFD deal with Commerzbank (strategic partnership) Group wide IFRS Reporting (incl. segment reports) Boost of organic growth of existing B2C business Sale of loss making AKTIONÄRSBANK to free up EUR 14m regulatory capital, improve annual earnings and pool banking activities in biw AG Implement technology based lending with the potential to generate an additional EUR 10+ million (do-it-yourself and / or partner with existing players) Enter Prime Standard of Frankfurt Stock Exchange to increase transparency and trading volume Further strategic acquisitions & partnerships Net Sales EUR m adj. EBITDA² (1) Guidance does not include revenues and earnings derived from additional upside (2) Adj. EBITDA includes operations related interest income and expenses 18

19 2. Corporate strategy (1): flatex as Bank 4.0 Flatex is the current market leader in the areas of usability, transparency and transaction costs. Our goal is to shift flatex s online brokerage business model to a modern, state of the art and mobile fully fledged online bank business model and to roll out new products (incl. debit/credit cards) vertical integration to gain a larger share of wallet (a recent survey proved that more than 60% of our customers are willing to increase their business activities with flatex). Through the acquisition of XCOM AG/biw AG, we are uniquely placed to achieve vertical integration at an extremely low cost as the systems and products are already in place. We have greatly increased our number of customers in Austria (by more than 8 times since Jul 2015) and will continue to build on this success. We seek to expand into other European countries in 2016/17 and are currently targeting a number of Central and Eastern European markets horizontal integration. 19

20 2. Corporate strategy (2): technology-based lending biw AG currently holds approx. EUR 1bn in customer deposits. These deposits are not currently being actively used for lending. innovative credit line flatex flex is activating some of the deposits of Bank biw AG Management of part of these deposits could generate an additional income of at least EUR 10m from 2016 onwards. Recent statistics and surveys show that there is an appetite for convenient and digital consumer lending. 20

21 2. Corporate strategy (3): fostering own FinTech ideas We developed our own multichannel mobile payment system which has been rolled out in Germany in We set up our own start-up lab in the heart of Berlin to attract and cooperate with innovative startup businesses. By continuing to evaluate trends, developing our own IT-based disruptive solutions and supporting inventive start-ups, we seek to position ourselves as a pioneer in the fast-moving and vibrant FinTech industry. 21

22 2. Corporate strategy (3): kesh our payment solution interaction with cash machines withdraw money from kesh-account load money into kesh with EC/credit card payments among individuals transfer money demand money transfer of address data payment approval in kesh Webshop Zahlung payments im in Online-Handel ecommerce collect contacts collect favorite dealers Kasse social banking Kasse payment at POS smartphone / tablet monitor with internet access integration in cash register system voucher code browser-access value added-services backend integration connection to third systems via API 22

23 2. Corporate strategy (4): FinTech campuses Frankfurt and Berlin one-stop-shop FinTech labs - offering Fin, Tech and Cap CORPORATE INNOVATION MENTORING NETWORK TECHNOLOGY MATCH-MAKING AND SUPPORT BANKING AND REGULATORY KNOW-HOW FINTECH PROJECT DEAL FLOW SESSIONS BANKING AND TECHNOLOGY EXPERTS ON SITE DEDICATED EDUCATION FINTECH B.Sc. ENTREPRENEURIAL WORKSHOPS AND EVENTS GROWTH INVESTMENT ACCESSIBLE LOGISTICS SERVICE & MANAGEMENT FOR EQUITY EARLY STAGE SEED INVESTMENTS VC FOLLOW-ON INVESTMENTS PLUG & PLAY OFFICE AND EVENT VENUES (WORKING TERRACE, SOHO CLUB, HEALTH CLUB) BIG DATA FOR RESEARCH & DEVELOPMENT ACCESS TO MARKETING AND PR CHANNELS 23

24 2. Corporate strategy (4): FinTech campuses - impressions 24

25 2. Corporate strategy (4): FinTech campuses - impressions 25

26 3. Strategic partnership

27 3. Strategic partnerships (ETPs and CFDs) In February 2016, entered into a strategic Joint Venture with Morgan Stanley Morgan Stanley starts issuing labeled structured products and warrants in Germany Significantly higher profit stake through MS joint venture than through standard product distribution Larger number of structured products clients can trade at zero costs Joint Venture basis for future internationalization and verticalization strategy In June 2015, we closed a strategic long-term CFD partnership with Commerzbank Key commercial points of the deal are: Cooperation began in Q and will run for seven years (until 2022) Commerzbank takes over s entire CFD orderflow execution (as market maker) received a double digit million amount upfront and will receive 40% of profits each year Key business impacts for are: significantly reduces its cost base and avoids investments in IT infrastructure Wind-down of CefDeX frees up regulatory capital and reduces overall risk exposure U.S. bank announces strategic partnership with online broker Flatex Morgan Stanley Pushes Into German Note Market With Partnership 27

28 4. Annexes

29 Market opportunity: banks and FinTech companies 29

30 Market opportunity: banks vs. FinTech unicorns 49,0 45,1 Market capitalisation of the world s 5 largest FinTech companies (USD 78 bn) is already larger than the market capitalisation of the five biggest listed German banks (USD 67 bn) Wirecard, as a FinTech Group comparable, shows a revenue multiple of 8.5x - Our revenue multiple today is ~3.0x 16,5 9,6 8,0 6,0 5,6 5,1 5,0 4,8 PayPal Deutsche Bank Commerzbank Lufax ZhongAn Square LendingClub Wirecard Stripe Zillow FinTech Group comparable FinTech company Bank Market cap in USD bn 30

31 Market opportunity: online banking Market share of online banking users in Germany Increasing growth rates with a strong upward trend Germany is a high potential, mostly undeveloped market in the fields of e-banking and mobile banking Share of e-banking users 2014 (%) Mobile banking usage per capita (%) Iceland 91% U.S. 63% Norway 89% Spain 61% Netherlands Sweden France UK Switzerland 58% 57% 54% 83% 82% Netherlands Poland Australia UK 61% 57% 54% 54% Germany 49% Germany 47% Austria 48% Czech Republic 39% Czech Republic 46% Romania 25% Source: Bitkom, Eurostat Source: statista 31

32 Market opportunity: FinTech market Market share of online banking users in Germany Nearly 60% (10bn US dollars) of the global fintech volume was invested in the U.S. Germany has a clear backlog with only 82m US dollars invested in FinTechs in 2014 Asia 11.7% Europe 10.2% Others 18.6% North America 59.5% Share of total investments in fintech companies globally in 2014 (%) Source: Accenture, CB Insights P2P Lending/ Online Lending Mobile Wallets 25.0% 26.8% Personal Finance and Management Corporate Lending 11.5% 14.1% Broad spectrum of fintech technology Mobile Points of Sales Technologies Mobile Banking Bitcoin Crowdfunding/Crowdinvesting 7.2% 6.0% 4.7% 3.6% High upside potential: P2P lending/online lending and mobile wallets Other 1.1% Source: Money of the Future Life.SREDA 32

33 Market opportunity: from offline to online Travel Agency Commerce Online saturation of markets e.g.: e.g.: We aim to play a leading role in the upcoming transformation of the financial services sector from offline to online With our online broker flatex we have already proven that we were able to successfully disrupt offline markets within a very short period of time Advertising e.g.: Our subsidiary biw has its own commercial banking license which can act as engine on which new B2C business lines can jumpstart on Financial Services HUGE POTENTIAL In addition to providing first class B2B services, we will also focus on improving our existing B2C businesses and creating new ones low high 33

34 Market opportunity: only 4 sectors are truly online transformation & corporate finance data, technology and infrastructure no single segment, rather a supporting function for other segments business & corporate banking wealth & asset management FINANCIAL SERVICES retail banking & consumer finance insurance & risk management capital markets & trading payments 34

35 Market opportunity: rise of digital banking Threat to retail banking from new market participants: next 3 years (International) Threat to retail banking from new market participants: next 3 years (Germany) % of those surveyed, by product, international, n=60 banks from 15 countries % of respondents, by product, Germany, n=60 banks from 15 countries Very likely Likely Unlikely Very unlikely Very likely Likely Unlikely Very unlikely P A YME N TS P A YME N TS S I MP L E S A V I N G S P R O D U C TS S I MP L E S A V I N G S P R O D U C TS C U R R E N T A C C O U N T C U R R E N T A C C O U N T C O N S U ME R C R E D I T C O N S U ME R C R E D I T S TRUCTURED S A V I N G S P R O D U C TS S TRUCTURED S A V I N G S P R O D U C TS H O ME L O A N B U S I N E S S H O ME L O A N B U S I N E S S C O R P O R A TE L O A N S C O R P O R A TE L O A N S Source: Roland Berger (2014) Source: Roland Berger (2014) 35

36 Market opportunity: banks and FinTech companies 36

37 Thank you Contact details Frank Niehage CEO Rotfeder-Ring Frankfurt, Germany All information in this presentation is PUBLIC knowledge This presentation contains forward-looking statements that are subject to risks and uncertainties that could cause the company s actual operating results to differ materially from those indicated by the forward-looking statements. The company expressly exclaims any obligation to update and revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise. Detailed information on FinTech Group can be found on the company s website at