Kempen European High Dividend Fund N.V. N · EURONEXT:KEHDF
Kempen European High Dividend Fund N.V. N — Van Lanschot Kempen — H1 2023 Earnings Presentation
30 slides from Kempen European High Dividend Fund N.V. N's earnings presentation, Aug 24, 2023
Slide 1: 2023 half-year results
ee 24 August 2023 2023 half-year results
Slide 2: H1 2023: key financial highlights
H1 2023: key financial highlights Net result €51.8m Operating expenses AuM net inflow Strong capital position (+8%) €235.2m €3.2bn CET 1 ratio 21.6% (+9%) Private Clients: €2.2bn (2022: 20.6%) Wholesale & Institutional Clients: €1.0bn RoCET 1 at 11.4% (H1 2022: 12.0%) Commission Efficiency ratio Cli
Slide 3: Progress on our sustainability goals
Progress on our sustainability goals Own funds and • 88% of funds on track for reduction of 7% average annual discretionary management emission intensity in line with Paris agreement solutions above target Lower emissions via our • Reduction: 5.0% CO2e/€ (2022: +8.7%) mortgage portfolio • Target: CO
Slide 4: Acquisition of Robeco online investment platform
Acquisition of Robeco online investment platform Positioning Evi van Lanschot for further growth • With this transaction, Evi van Lanschot becomes a leading online investment platform in the Netherlands, with combined AuM of €6.3bn • One-off transition costs in the range of €8m–11m during a two-year
Slide 5: On track with execution of our wealth management strategy
On track with execution of our wealth management strategy Bolt-on acquisitions Healthy AuM growth Good progress on the integration of Investing in growth within Private (+7% to €115.2bn) Mercier Vanderlinden and Robeco online Clients by attracting new talent investment platform Satisfied clients and
Slide 6: Sustainable and profitable growth with a capital-light balance sheet
Sustainable and profitable growth – ee with a capital-light balance sheet Organic growth Bolt-on acquisitions Market performance 6
Slide 7: 2023 half-year results
ee 2023 half-year results
Slide 8: H1 2023: key messages
H1 2023: key messages Solid net profit of €51.8m (H1 2022: €48.2m) • Commission income up (+1%), of which securities commission income +6% and other commission income -30% • Increase in interest income (+67%) • Operating expenses up (+9%) Our segments • Private Clients: net AuM inflow at €2.2bn and
Slide 9: Net result amounts to €51.8m
Net result amounts to €51.8m Key drivers of net result (€ m) • H1 2023: lower result MTN portfolio (- €10.9m), due to rising interest rates • H1 2022 included a book profit (€7.4m) -26.2 46.5 -19.2 9.7 5.6 -7.4 -5.4 70.8 48.2 48.2 50.5 50.5 51.6 46.2 46.2 51.8 H1 2022 Securities Other Interest Other
Slide 10: Private Clients: Continued high net inflows
Private Clients: Continued high net inflows AuM (€ bn) -2.6 2.2 42.7 45.3 40.5 40.5 31-12-2022 Net AuM Market 30-6-2023 inflow performance • Net inflows: 79% non-discretionary, 16% discretionary and 5% investment strategies • Net inflows well spread across NL, BE, and CH • Operating result before ta
Slide 11: Private Clients Belgium
Private Clients Belgium Acquisition of the remaining 30% of Mercier Vanderlinden completed AuM (€ bn) 0.3 0.8 9.2 9.2 9.5 10.3 31/12/2022 Net AuM Market 30/06/2023 inflow performance • Integration well on-track: as of 1 January 2024, under the name Mercier Van Lanschot • Ambition: to become a top-th
Slide 12: Wholesale & Institutional Clients: €1.0bn net inflow
Wholesale & Institutional Clients: €1.0bn net inflow AuM (€ bn) 0.7 0.4 1.5 -0.1 67.3 67.2 67.2 67.9 67.5 69.9 31/12/2022 Net investment Net fiduciary Net alternative Market 30/6/2023 strategies management investment performance inflows inflows solutions inflows • Operating result before tax at -€1.
Slide 13: Ability to retain solid margins at both Private Clients and Wholesale & Institutional Clients
Ability to retain solid margins at both Private Clients and Wholesale & Institutional Clients Annualised recurring fees* (€ m) AuM breakdown (~%) 10% 20% Private Clients 70% 359.5 379.8 306.9 329.6 339.8 23% 27% Wholesale & Institutional Clients HY2021 YE2021 HY2022 YE2022 HY2023 49% Equities Bonds
Slide 14: Investment Banking Clients: challenging markets due to higher interest rates
Investment Banking Clients: challenging markets due to higher interest rates Commission income (€ m) 29.0 31.7 26.3 24.3 17.0 H1 2021 H2 2021 H1 2022 H2 2022 H1 2023 • Operating result before tax to -€4.8m (H1 2022: €1.3m) • As usual, we’re adapting our organisation to market conditions with a focus
Slide 15: Interest margins improved in H1 2023
Interest margins improved in H1 2023 Interest income (€ m) Interest margin (12-mth moving average, %) 1.25% 1.25% 116.2 0.98% 0.95% 93.0 0.88% 75.1 76.1 77.5 69.7 0.92% 0.94% 0.86% H2 2020 H1 2021 H2 2021 H1 2022 H2 2022 H1 2023 H2 2021 H1 2022 H2 2022 H1 2023 Clean interest margin* Interest margin
Slide 16: Net interest income: savings rate and client behaviour main drivers
Net interest income: savings rate and client behaviour main drivers • Notional weighted client rate relative to the ECB rate is approx. 30% per end of June 2023 • Current average term deposit maturity is approx. 0.5 years Expectations H2 2023 • Further rise of term deposits in the client deposits mi
Slide 17: Other income
Other income • Other income consists of income from securities and associates and result on financial transactions • Total other income at -€4.2m (H1 2022: €22.0m), decrease driven by: • Lower result on co-investments in own products at -€0.5m (H1 2022: €1.7m) • Result on medium-term notes at -€10.1
Slide 18: Income from securities and associates
Income from securities and associates €m Income Income Book value Book value H1-2023 H1-2022 HY2023 YE2022 VLP (minority interests) 2.3 12.2 43.8 47.8 Bolster Investments Coöperatief UA 2.2 2.5 69.3 63.1 Co-investments in own products 1.3 -8.5 116.7 123.3 Other equity investments 0.0 0.0 1.9 2.0 Tot
Slide 19: Increase operating expenses mainly driven by investments in growth
Increase operating expenses mainly driven by investments in growth Operating expenses (€ m) 11.5 2.6 5.2 216.0 216.0 227.5 230.1 235.2 H1 2022 Staff costs Accommodation Other H1 2023 expenses • Staff costs up, mainly due to • a higher number of FTEs at 1,844 (June 2022: 1,713), driven by a shift fro
Slide 20: Stable loan portfolio
Stable loan portfolio €m Loan Loan % change Impaired Provision Impaired Coverage portfolio portfolio loans ratio ratio 30/06/2023 31/12/2022 Mortgages 6,314 6,341 0% 27 2 0.4% 9% Other loans 2,311 2,371 -3% 85 24 3.7% 29% Loan portfolio 8,625 8,712 -1% 112 27 1.3% 24% Mortgages distributed by third
Slide 21: High quality of loan portfolio allowed for a release from loan loss provisions
High quality of loan portfolio allowed for a release from loan loss provisions Additions to loan loss provisions (€ m) Loan loss provision per stage -34 bps* -2 bps* -9 bps* €m 30/06/2023 31/12/2022 % change Stage 1 4.9 6.1 -19% Stage 2 6.3 7.0 -9% -0.5 Stage 3 26.7 26.9 -1% -1.9 Total 37.9 40.0 -5%
Slide 22: Strong CET 1 ratio at 21.6%
Strong CET 1 ratio at 21.6% Common Equity Tier 1 ratio (%) 0.8 0.2 20.6 20.6 21.4 21.6 31/12/2022 Share issuance related Other 30/6/2023 to the acquisition of Mercier Vanderlinden The CET 1 ratio according to the ‘Basel IV fully loaded’ definition stood at around 22% Expected CET 1 ratio development
Slide 23: Committed to our financial targets
Committed to our financial targets Common Equity Tier 1 ratio Dividend pay-out ratio* 15%+2.5% 50%-70% medium-term medium-term 23.8% 24.3% 23.7% 20.6% 21.6% n/a 65% 67% 57% 53% 2019 2020 2021 2022 H1 2023 2019 2020 2021 2022 H1 2023 Efficiency ratio Return on Common Equity Tier 1* 70% medium-term 12
Slide 24: H1 2023: Key financial highlights
H1 2023: Key financial highlights Net result €51.8m Operating expenses AuM net inflow Strong capital position (+8%) €235.2m €3.2bn CET 1 ratio 21.6% (+9%) Private Clients: €2.2bn (2022: 20.6%) Wholesale & Institutional Clients: €1.0bn RoCET 1 at 11.4% (H1 2022: 12.0%) Commission Efficiency ratio Cli
Slide 25: Appendix
ee Appendix
Slide 26: Overview of net result
Overview of net result €m H1 2023 H1 2022 % change Commission income 203.7 201.3 1% of which securities commission income 186.5 176.7 6% of which other commission income 17.2 24.6 -30% Interest 116.2 69.7 67% Other income -4.2 22.0 Income from operating activities 315.7 293.1 8% Operating expenses -
Slide 27: Key figures by segment: H1 2023
Key figures by segment: H1 2023 €m Private Wholesale & Investment Other Total Clients Institutional Banking Clients Clients Commission income 144.4 39.3 17.0 3.1 203.7 Interest income 106.5 0.1 -0.1 9.8 116.2 Other income 0.6 0.2 0.3 -5.3 -4.2 Income from operating activities 251.5 39.6 17.2 7.5 315
Slide 28: Progress on our non-financial KPIs
Progress on our non-financial KPIs KPI Targets Performance H1 2023 Performance 2022 Manufactured Three-year relative performance of our managed propositions > benchmark 0.3% 0.2% capital Human and Employer Net Promoter Score (eNPS) >10 22 18 intellectual Employee engagement score > 80% 88% 88% capit
Slide 29: High scores on external ESG ratings
High scores on external ESG ratings Entered ESG AEX index in H1 2023 Governance: 2 B- rating Lower governance risk = 1 Higher governance risk = 10 ISS ESG Corporate Rating 8th place in league table of AA rating 486 entrants on resilience to ESG risks 21st place in a league table 4 and 5 stars (out o
Slide 30: Disclaimer
Disclaimer Disclaimer and cautionary note on forward-looking statements This document may contain forward-looking statements and targets on future events and developments. These forward-looking statements and targets are based on the current insights, information and assumptions of Van Lanschot Kemp