Leonteq Ag · SIX:LEON
Leonteq — Investor Presentation (May 2022)
55 slides from Leonteq's investor presentation, May 2022
Slide 1: Investor Presentation Leonteq AG
INVESTOR PRESENTATION LEONTEQ AG ZURICH, MAY 2022
Slide 2: Disclaimer
DISCLAIMER This presentation of Leonteq AG (the “Company”) serves for information purposes only and does not constitute research. This presentation and all materials, documents and information used therein or distributed in the context of this presentation do not constitute or form part of and shoul
Slide 3: Our Company
ote t LEONTEQ OUR COMPANY
Slide 4: Leonteq at a Glance
LEONTEQ AT A GLANCE Leading fintech company from Switzerland 14 offices across EMEA and APAC State-of-the-art technology platform developed and maintained in-house Services delivered through API, front-end GUI and comprehensive white-label offerings ~520 employees from >50 nations Headquarters in Zu
Slide 5: Our Offering in the Context of the Business Needs of Our Clients and Partners
OUR OFFERING IN THE CONTEXT OF THE BUSINESS NEEDS OF OUR CLIENTS AND PARTNERS Our clients Our solutions • Financial intermediaries which offer investment products to their clients (from retail clients to Fully automated click ’n’ trade multi-issuer institutional investors) platform • Current portfol
Slide 6: Our Key Differentiating Factors
OUR KEY DIFFERENTIATING FACTORS One of the leading multi- Global distribution network issuer platforms across EMEA, LATAM and APAC Highly scalable platform Best-in-class financial with large computation engineering and power recognised sales force Automated processes Full white-labelling capabilitie
Slide 7: Financial Highlights 2021 at a Glance
FINANCIAL HIGHLIGHTS 2021 AT A GLANCE Total operating income in CHF million Net profit EPS in CHF million in CHF 417.8 155.7 8.47 282.4 256.2 234.5 219.7 215.4 207.0 23.2 2020: 39.9 2020: 2.15 2008 … 2015 2016 2017 2018 2019 2020 2021 Capital base Return on equity Dividend per share in CHF million i
Slide 8: Unique Pool of Experts in Technology and Structured Products
UNIQUE POOL OF EXPERTS IN TECHNOLOGY AND STRUCTURED PRODUCTS FROM MORE THAN 50 NATIONS Staff base development Staff base by region Gender diversity in FTEs 18% women 12% 26% 524 Average age 519 510 508 486 463 440 62% 361 36 291 270 243 204 129 years 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Slide 9: Leading Provider of Investment Solutions Recognised with More Than 70 Industry Awards
LEADING PROVIDER OF INVESTMENT SOLUTIONS RECOGNISED WITH MORE THAN 70 INDUSTRY AWARDS SINCE INCEPTION Best products (selection) Service, Platform & Performance (Selection) Best Commodity Product (2022) Best ESG product (2021) Best FX Product (2021) Special Award for white-labelling program (2022) Be
Slide 10: Our Market
ote t LEONTEQ OUR MARKET
Slide 11: Low Real Interest Rate Environment and Digitisation Drive Demand
LOW REAL INTEREST RATE ENVIRONMENT AND DIGITISATION DRIVE DEMAND FOR TAILORED INVESTMENT SOLUTIONS Global wealth (USD trillion)1 Global portfolio allocation2 Key drivers for increase in demand for tailored investment solutions: CAGR +11% 1. Low real interest rates • With increasing wealth, need for
Slide 12: Global Footprint with 14 Offices Across EMEA and APAC
GLOBAL FOOTPRINT WITH 14 OFFICES SUPERVISED BY 13 REGULATORS ACROSS EMEA AND APAC 12
Slide 13: Our Operations in Switzerland: Addressable Market of CHF 350 Billion
OUR OPERATIONS IN SWITZERLAND: STRONG PRESENCE WITH TOTAL ADDRESSABLE MARKET OF CHF 350 BILLION (TURNOVER) SSPA1 SIX Swiss Exchange2 Leonteq market share2 (CHF billion, by product category) (CHF billion, by product category) CAGR +5% CAGR +6% 368 332 352 47 47 337 23 20 3 12% 32 Market share 276 47
Slide 14: Our Operations in Italy: Addressable Market of Close to EUR 40 Billion
OUR OPERATIONS IN ITALY: GROWING PRESENCE WITH A TOTAL ADDRESSABLE MARKET OF CLOSE TO EUR 40 BILLION (TURNOVER) ACEPI1 – Primary issuance Borsa Italiana2 – Secondary market Leonteq market share2 (EUR billion) (EUR billion) 30 27 25 27 4 7% 2021 Market share 22 13 for listed investment 15 13 products
Slide 15: Our Platform
ote t LEONTEQ OUR PLATFORM
Slide 16: Cutting Edge Technology and Client Focus
CUTTING EDGE TECHNOLOGY AND CLIENT FOCUS Cutting edge Large universe of Flexibility to tailor to Multi-issuer Technology structured products individual needs platform • State-of-the-art • +400 product variations • Competitive pricing and • >30 issuers technology built from the of yield enhancement,
Slide 17: One of the Largest Universes of Structured Products with a Leading Technology Platform
PROVIDING ONE OF THE LARGEST UNIVERSES OF STRUCTURED PRODUCTS WITH A LEADING TECHNOLOGY PLATFORM Equity Equities >260,000 client transactions indices processed each year >100,000 documents Credit Currencies generated each day Participation Leverage >2,000 underlying Interest Commodities rates securi
Slide 18: LynQs: Leonteq's One-Stop-Shop for Structured Products
LYNQS*: LEONTEQ’S ONE-STOP-SHOP PROVIDING CLIENTS DIGITAL ACCESS TO THE WORLD OF STRUCTURED PRODUCTS INVESTMENT IDEAS Latest trends and daily updated investment ideas prepared by Leonteq’s leading structuring team QUOTE Click ’n’ trade tailor-made investment products from more than 10 renowned issue
Slide 19: AMC Gateway: Management of Own Tailor-Made Investment Strategy
AMC GATEWAY: ALLOWS FOR MANAGEMENT OF OWN TAILOR-MADE INVESTMENT STRATEGY SINGLE POINT OF ENTRY Leonteq supports product implementation, trade execution and reporting LESS ADMINISTRATION Avoid individual trade processing with custodian banks (one central rebalancing for all clients) COST EFFICIENT I
Slide 20: IMD/Leonteq Online Education Course
IMD/LEONTEQ ONLINE EDUCATION COURSE “INVESTING IN STRUCTURED PRODUCTS” JOINTLY DEVELOPED TOGETHER WITH IMD The Institute for Management Development (IMD) is leading Business School based in Lausanne, Switzerland 2 MODULES, 11 UNITS Gain a thorough understanding of structured products across various
Slide 21: Balance Sheet-Light Business
BALANCE SHEET-LIGHT BUSINESS SMART HEDGING ISSUANCE THIRD-PARTY ISSUERS & Balance sheet-light turnover (CHF million) PLATFORM (SHIP) BACK-TO-BACK HEDGES • Seven leading investment • In parallel to SHIP, Leonteq banks connected to the platform provides third-party products (manufactured outside of •
Slide 22: Smart Hedging Issuance Platform (SHIP)
SMART HEDGING ISSUANCE PLATFORM (SHIP): ENABLES AUTOMATED PRICING FOR BOND AND OPTION COMPONENT Benefits for the client • Only platform which allows to decouple the choice of the desired credit risk from the provider of the option component • Best option price out of seven leading investment banks i
Slide 23: Largest Offering of Crypto Asset Investments in Securitized Format
LARGEST OFFERING OF CRYPTO ASSET INVESTMENTS IN SECURITIZED FORMAT SECURITISED CRYPTO ASSET INVESTMENT Allows trading crypto assets as simply and easily as bonds and stocks in any custody account EASY & SECURE ACCESS TO CRYPTO ASSETS No need for key management LARGE PRODUCT UNIVERSE Various products
Slide 24: Expertise in Fund Derivatives
EXPERTISE IN FUND DERIVATIVES Aberdeen JP Morgan Leonteq works closely with a wide range of fund Allianz Kempen management companies to deliver innovative solutions Amundi and competitive pricing Muzinich Participation Leverage Aviva Neuberger Bergmann AXA New Funds Features Capital Yield Capital Bl
Slide 25: Savings and Retirement Solutions Platform (Omega)
SAVINGS AND RETIREMENT SOLUTIONS PLATFORM (OMEGA): ENABLES DIGITAL PROCESSING OF INSURANCE POLICIES Omega • Proprietary platform that Omega Portal / External guarantee enables the fully partner platform provider automated, digital processing of the entire lifecycle of insurance policies and capitali
Slide 26: First Digital Long-Term Savings Product with Guarantee and Upside
FIRST DIGITAL LONG-TERM SAVINGS PRODUCT WITH GUARANTEE AND UPSIDE • Digital 3a savings account with guarantee and return potential • Savers benefit from higher return potential than with traditional accounts + greater safety than with funds solutions • Addresses the desire for returns and at the sam
Slide 27: Our Progress 2018 - 2021
ote *t LEONTEQ OUR PROGRESS 2018 - 2021
Slide 28: We Successfully Executed Our Strategic Plan Defined in 2018
WE SUCCESSFULLY EXECUTED OUR STRATEGIC PLAN DEFINED IN 2018 Priorities defined in 2018 Achievements Performance Balance sheet-light • SHIP fully operational since mid-2020; 7 hedging turnover (CHF million) Initiate Smart Hedging and counterparties and 6 (white-labelling) issuers 2’558 1 Issuance Pla
Slide 29: We Delivered on the Strategic Priorities Set for 2021
WE DELIVERED ON THE STRATEGIC PRIORITIES SET FOR 2021 Add new pay-offs and product features and Go-live of pricing module, white-labelling features add at least one white-labelling issuer to SHIP and integration of AMC client portal to LynQs Issue first products of onboarded white-labelling Further
Slide 30: We Built a Unique Ecosystem with >40 New Partners Since 2018
WE BUILT A UNIQUE ECOSYSTEM FOR INVESTMENT SOLUTIONS WITH THE ADDITION OF >40 NEW PARTNERS SINCE 2018 Self Private Regional Universal directed banks banks banks investors +5 sp.leonteq.com partners Independent asset Institutional managers investors Family offices Digital solutions & Clients & connec
Slide 31: We Diversified Our Offering and Improved Quality of Earnings
WE SIGNIFICANTLY DIVERSIFIED OUR OFFERING AND IMPROVED THE QUALITY OF OUR EARNINGS Economic revenues (excluding hedging result; CHF million) Traditional structured products business Revenues from traditional products (e.g. BRCs/Autocallables) pre-dominantly on equity and equity indices as underlying
Slide 32: We Expanded Our Global Footprint and Diversified Our Client Base
WE EXPANDED OUR GLOBAL FOOTPRINT AND DIVERSIFIED OUR CLIENT BASE Net fee income by region (CHF million) Economic revenues by client type1 (%) 307 43 14% 2017 2021 247 15% 36 5% 3% 147 48% 41% 44% 109 33% 64% 54% 117 38% 41% 102 2017 2021 Switzerland Europe (excl. Switzerland) Asia (incl. Middle East
Slide 33: Established Leonteq as a Recognised Issuer and Reduced Dependency on Historic Partners
WE ESTABLISHED LEONTEQ AS A RECOGNISED ISSUER AND REDUCED DEPENDENCY ON HISTORIC PARTNERS Platform assets by issuer1 (CHF billion) Turnover by issuer1 (CHF billion) 16.0 28.9 26.8 2.1 13% 3.8 13% 7% 2.0 11.4 32% 8.5 4% 0.5 39% 6.3 14.7 51% 26% 3.0 61% 16.3 70% 7.9 7.6 48% 10.4 36% 2017 2021 2017 202
Slide 34: Operating Leverage Through Platform Scalability and Automation
WE DEMONSTRATED OPERATING LEVERAGE THROUGH PLATFORM SCALABILITY AND AUTOMATION Operational leverage (Indexed: 2017 = 100) Number of client transactions on the platform 300 4yr CAGR: +28% 4yr CAGR 28% 250 200 150 4yr 264,213 CAGR 5% 206,673 100 164,007 114,005 97,196 50 2017 2018 2019 2020 2021 Trans
Slide 35: Our Growth Strategy 2026
ote *t LEONTEQ OUR GROWTH STRATEGY 2026
Slide 36: Growth Strategy 2026 Based on 4 Dimensions
BUILDING ON OUR PROGRESS, WE ARE EXECUTING A GROWTH STRATEGY 2026 BASED ON 4 DIMENSIONS OFFERING PLATFORM We are growing our business on the back We are at the forefront of digitalisation and of an enlarged and diverse offering across will continue to invest in digital client products, asset classes
Slide 37: Key Initiatives to Drive Growth Strategy 2026
WE ARE INVESTING IN KEY INITIATIVES TO DRIVE OUR GROWTH STRATEGY 2026 Expansion of product offering Establish new pension savings Expansion of issuer universe (B2B) offering (D2C) • Further build-out of AMCs, systematic • Launch new innovative product concept • Build-out existing set-ups and add new
Slide 38: Measuring Success Against Clear Targets for 2026
WE ARE MEASURING OUR SUCCESS AGAINST CLEAR TARGETS FOR 2026 Total operating income (CHF million) Return on equity 450-500 418 112 215 21% >15% 307 247 6% 2017 2021 2026E 2017 2021 2026E Net interest result & other ordinary income 1 Net trading income 2 Net fee income 1 Net interest result & other or
Slide 39: Our Performance
ote t LEONTEQ OUR PERFORMANCE
Slide 40: A Track Record of Revenue Growth Since Inception
A TRACK RECORD OF REVENUE GROWTH SINCE INCEPTION Quarterly economic revenues since inception (CHF million)1 140 120 100 80 60 40 20 0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 1 Economic revenues are defined as sales and trading income earned and are considered as recogni
Slide 41: Investment Phase Is Paying Off - Strong Growth in Revenue and Profit
INVESTMENT PHASE IS PAYING OFF - STRONG GROWTH IN REVENUE AND PROFIT Total operating income (CHF million) Net profit (CHF million) 206 212 81 74 146 51 136 132 131 125 40 115 33 34 100 104 30 22 6 1 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 2017 2017 2018 2018 2019 2019 2020 2020 2
Slide 42: Cost Increase from Strategic Investments, Variable Costs and Legal Provisions
London COST INCREASE RESULTING FROM CONTINUED STRATEGIC INVESTMENTS, PERFORMANCE DRIVEN VARIABLE COSTS AND LEGAL PROVISIONS Total operating expenses (CHF million) Components of total operating expenses 140 2% 3% 1% 2% 2% 2% 100% 120 7% 6% 11% 8% 9% 90% 15% 16% 17% 17% 17% 9% 13% 100 80% 26% 25% 31%
Slide 43: Earnings Quality and Issuer Diversification
EARNINGS QUALITY AND ISSUER DIVERSIFICATION Economic revenues by business type1 Platform assets by issuer category2 Turnover by issuer category2 (excluding hedging result; CHF million) (CHF billion) (CHF billion) 338 30.3 16.0 28.8 28.9 299 14.7 26.8 26.4 14.1 261 240 11.9 10.4 234 11.4 189 7.6 16.5
Slide 44: Platform Scalability
PLATFORM SCALABILITY Number of client transactions Number of issued products Number of pension savings contracts (in thousand) (in thousand) (in thousand) 4yr CAGR 4yr CAGR 4yr CAGR +28% +12% +12% 264 52 53 42 47 37 41 207 32 164 27 28 33 114 97 2017 2018 2019 2020 2021 2017 2018 2019 2020 2021 2017
Slide 45: Diversification of Client Franchise and Regions
DIVERSIFICATION OF CLIENT FRANCHISE AND REGIONS Number of clients Economic revenues by client type Net fee income by region (CHF million) 335 307 273 265 41% 247 129 48% 51% 117 64% 61% 115 112 5% 102 33 1,085 2% 43 1,017 967 998 1,018 3% 32 28 3% 36 3% 50% 54% 173 46% 147 36% 126 125 33% 109 2017 2
Slide 46: Our Liquidity & Capital Management
OUR LIQUIDITY & CAPITAL MANAGEMENT 46
Slide 47: Solid Balance Sheet Driven by Own Issuance and High Quality Investment Portfolio
SOLID BALANCE SHEET DRIVEN BY OWN ISSUANCE, LIQUID HEDGING POSITIONS AND HIGH QUALITY INVESTMENT PORTFOLIO Assets (CHF billion) Liabilities and shareholders’ equity (CHF billion) • Total assets grew by 16% to CHF 14.4 billion mainly driven by record 14.4 14.4 volumes in own issued products to 1.2 CH
Slide 48: High-Quality Investment Portfolio with CHF 2.3 Billion at End-2021
HIGH-QUALITY INVESTMENT PORTFOLIO (Ø AA RATING) WITH CHF 2.3 BILLION AT END-2021 By credit rating By type of investment By maturity 6% 3% 3% 18% 24% 25% 11% 24% 35% 41% 37% 18% 33% 47% 24% 51% Governments & Supranationals 0-12 months 12-24 months 24-36 months Aaa Aa1-Aa3 A1-A3 Baa1-Baa3 Governments
Slide 49: Strong Build-Up of Capital Base
STRONG BUILD-UP OF CAPITAL BASE (EQUITY + DEFERRED FEE INCOME) Shareholders’ equity (CHF million)1 Capital base (CHF million)1,2 802 874 663 769 648 723 608 683 416 385 418 449 464 376 418 421 158 185 125 129 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2012 2013 2014 2015 2016 2017 2018 2019 2
Slide 50: Move to a Progressive Dividend Policy with Payout Ratio of >50%
MOVE TO A PROGRESSIVE DIVIDEND POLICY WITH PAYOUT RATIO OF >50% STARTING IN THE FINANCIAL YEAR 2022 2019 2020 2021 2022 et seq. • Launch of new phase • Distribution in line • Targeted capital base • Very strong capital of conservative with conservative reached base dividend policy on the dividend po
Slide 51: Appendix
ote t LEONTEQ APPENDIX
Slide 52: Group Results
GROUP RESULTS Income statement H2 2021 H1 2021 H2 2020 Change FY 2021 FY 2020 Change (CHF million) y-o-y y-o-y Net fee income 136.7 170.0 121.6 12% 306.7 334.6 (8%) Net trading result 77.0 35.4 8.7 785% 112.4 (98.4) N/A Net interest result (3.3) (2.4) (1.5) 120% (5.7) (6.5) (12%) Other ordinary inco
Slide 53: Regional Results
REGIONAL RESULTS Fee income breakdown H2 2021 H1 2021 H2 2020 Change FY 2021 FY 2020 Change (CHF million) y-o-y y-o-y Switzerland 57.2 60.0 46.5 23% 117.2 128.5 (9%) Europe (excl. Switzerland) 60.5 85.8 59.8 1% 146.3 173.0 (15%) Asia (incl. Middle East) 19.0 24.2 15.3 24% 43.2 33.1 31% Total net fee
Slide 54: Shareholder Structure
SHAREHOLDER STRUCTURE Shareholder structure1 Significant shareholders1,2 Raiffeisen Switzerland3 29.02% Lukas T. Ruflin 8.18% 13% Sandro Dorigo 2.11% Subtotal shareholders’ agreement 39.31% 8% 32% Rainer-Marc Frey 7.14% Credit Suisse Funds AG 3.42% Swisscanto Fondsleitung AG 3.03% 21% Directors and
Slide 55: Investor Relations Contacts
INVESTOR RELATIONS CONTACTS Dominik Ruggli Leonteq AG Head Investor Relations, Investor Relations Communications & Marketing Europaallee 39 | 8004 Zürich | Switzerland +41 58 800 18 55 investorrelations@leonteq.com www.leonteq.com/investors Follow Us Linkedin Twitter Renato Bolliger Facebook Investo