Leonteq Ag · SIX:LEON
Leonteq — H1 2021 Earnings Presentation
27 slides from Leonteq's earnings presentation, Jul 22, 2021
Slide 1: Leonteq Results Presentation Half-Year 2021
LEONTEQ RESULTS PRESENTATION HALF-YEAR 2021 ZURICH, 22 JULY 2021
Slide 2: Legal Disclaimer
LEGAL 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
Slide 3: Highlights H1 2021
HIGHLIGHTS H1 2021 LUKAS RUFLIN | CEO 22.07.2021 3
Slide 4: Record results validate investments into key strategic initiatives
RECORD RESULTS VALIDATE INVESTMENTS INTO KEY STRATEGIC INITIATIVES OVER THE LAST THREE YEARS Key figures H1 2021 205.8 125.2 74.4 4.04 H1 20: 103.5 H1 20: 98.7 H1 20: 5.5 H1 20: 0.29 +99% +27% Total operating income Total operating expenses Group net profit Earnings per share (CHF million) (CHF mill
Slide 5: Continued strategic progress in first half 2021
CONTINUED STRATEGIC PROGRESS IN FIRST HALF 2021 January 2021 January 2021 March 2021 March 2021 April 2021 May 2021 May 2021 June 2021 June 2021 Award New 3 Awards The Market First Quote Cooperation IMD For best Launch of new World’s first Collaboration to won including Dubai Start of product produc
Slide 6: Financial Performance
FINANCIAL PERFORMANCE MARCO AMATO | DEPUTY CEO & CFO 22.07.2021 6
Slide 7: Strong client activity and disciplined risk management result in record performance
STRONG CLIENT ACTIVITY AND DISCIPLINED RISK MANAGEMENT IN A FAVOURABLE MARKET ENVIRONMENT RESULT IN RECORD PERFORMANCE Total operating income Total operating expenses Group net profit (CHF million) (CHF million) (CHF million) +99% +69m +27% 205.8 74.4 131.0 125.2 103.5 98.7 99.2 34.4 5.5 H1 2020 H2
Slide 8: Topline driven by exceptional Q1 2021 and strong Q2 2021
TOPLINE DRIVEN BY EXCEPTIONAL Q1 2021 AND STRONG Q2 2021 Quarterly economic revenues since inception (in CHF million)1 Drivers for strong fee income • High levels of client activity in a 160 favorable market environment • Strong client demand across products, 140 underlyings and issuers • Volumes an
Slide 9: 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 Nearshoring initiative Lisbon, Portugal Total operating expenses (CHF million) H1 2020 reported 98.7 Release of provisions 4.0 H1 2020 adjusted cost base 102.7 Cost benefit nea
Slide 10: Investment Solutions: growth in turnover driven by strong Leonteq issuance
INVESTMENT SOLUTIONS: GROWTH IN TURNOVER DRIVEN BY STRONG LEONTEQ ISSUANCE Turnover (CHF billion) Margin (basis points) Net fee income (CHF million) 15.9 15.4 198.7 164.3 11.0 8.1 127 9.2 111 130 104 119.8 114.1 78.1 5.6 104 96 58 7.8 6.2 5.4 86.2 78.9 56.1 H1 2020 H2 2020 H1 2021 H1 2020 H2 2020 H1
Slide 11: IWPS: segment income impacted by pandemic-related effects
IWPS: SEGMENT INCOME IMPACTED BY PANDEMIC–RELATED EFFECTS AND CHALLENGING INTEREST RATE ENVIRONMENT CHF 30Y swap rate (%) Unit-linked products Segment income (CHF million) outstanding 0.60 +2% 0.40 0.20 0.00 52,417 24.7 51,577 -0.20 49,746 8.8 8.8 -0.40 -0.60 30.06.2020 31.12.2020 30.06.2021 H1 2020
Slide 12: Capital target of CHF 800 million reached six months ahead of guidance
CAPITAL TARGET OF CHF 800 MILLION AREA REACHED SIX MONTH AHEAD OF GUIDANCE Shareholders’ equity (CHF million) Deferred fee income (CHF million) 74.4 3.7 19.4 -6.1 -13.8 721.4 75.1 78.8 647.5 31 December Distribution to Allocation to Other Group net profit 30 June 31 December Net change in deferred 3
Slide 13: Strategy & Business Update
STRATEGY & BUSINESS UPDATE LUKAS RUFLIN | CEO 22.07.2021 13
Slide 14: Fundamental change in business dynamics over three years
FUNDAMENTAL CHANGE IN BUSINESS DYNAMICS OVER THREE YEARS end-June 2018 end-June 2021 Environment • Pre-pandemic • Post-pandemic • Margin pressure • Less competition on margins • Trends towards digitisation • Digitalisation trends accelerating • Low interest rate environment • Continuous low interest
Slide 15: Improved revenue quality and business diversification
IMPROVED REVENUE QUALITY AND BUSINESS DIVERSIFICATION Balance sheet light business Leonteq & new issuers New offices (Turnover contribution) (Turnover contribution) (Revenues; CHF million) 22 9% 61% 40% 14 NA H1 2018 H1 2021 H1 2018 H1 2021 H1 2018 H1 2021 Asset management-like business Crypto asset
Slide 16: Platform scalability demonstrated: transactions increased from 60K to 140K
PLATFORM SCALABILITY DEMONSTRATED: # TRANSACTIONS INCREASED FROM 60K IN H1 2018 TO 140K IN H1 2021 Operational leverage Drivers for improved scalability (Indexed: H1 2018 = 100) 280 +139% Automation of processes across the full value 250 chain 220 190 Full straight-through-processing rate improved t
Slide 17: Leonteq's journey towards a scalable business model
LEONTEQ’S JOURNEY TOWARDS A SCALABLE BUSINESS MODEL ACROSS TECHNOLOGY, ISSUANCE, CONTENT, HEDGING AND DISTRIBUTION Scaled distribution Scaled (D2C) distribution (B2B4C) Scaled hedging Scaled content Scaled issuance White-labelled Scaled (B2B) Strengthen Addition of White-labelled digital consumer pl
Slide 18: Our ecosystem for investment solutions
OUR ECOSYSTEM FOR INVESTMENT SOLUTIONS +5 Private Regional Universal Self partners banks banks banks directed investors OMEGA SIGMA sp.leonteq.com Independent asset Institutional managers investors Family offices Digital solutions & Clients & connectivity investors Content, White- product and labell
Slide 19: Leonteq is well positioned for future growth
LEONTEQ IS WELL POSITIONED FOR FUTURE GROWTH Expansion of product offering Further build-out of AMCs, systematic indices, quantitative investment strategies and cryptocurrencies Expansion of issuer universe Build-out existing set-ups and add new white-labelling partners Acceleration of digital offer
Slide 20: Summary
SUMMARY LUKAS RUFLIN | CEO 22.07.2021 20
Slide 21: Summary & Outlook
SUMMARY & OUTLOOK • Record results in H1 2021, resulting from strong client activity, disciplined risk management and focused strategy execution Summary • Topline driven by exceptional Q1 2021 and strong Q2 2021 • Further improvement in business diversification and revenue quality in H1 2021 • Pande
Slide 22: Appendix
APPENDIX 22.07.2021 22
Slide 23: Group Results
GROUP RESULTS Income statement H1 2021 H2 2020 H1 2020 Change Change CHFm y-o-y vs H2 2020 Net fee income 170.0 121.6 213.0 (20%) 40% Net trading result 35.4 8.7 (107.1) NA 307% Net interest result (2.4) (1.5) (5.0) (52%) 60% Other ordinary income 2.8 2.2 2.6 7% 27% Total operating income 205.8 131.
Slide 24: Segment Results
SEGMENT RESULTS Investment Solutions H1 2021 H2 2020 H1 2020 Change Change y-o-y vs H2 2020 Total operating income (CHFm) 194.4 121.0 76.8 153% 61% Total operating expenses (CHFm) (94.3) (77.1) (82.3) 15% 22% Profit before taxes (CHFm) 100.1 43.9 (5.5) NA 128% Platform assets (CHFbn) 1 15.4 14.1 13.
Slide 25: Regional Results
REGIONAL RESULTS Fee income breakdown H1 2021 H2 2020 H1 2020 Change Change CHFm y-o-y vs H2 2020 Switzerland 60.0 46.5 82.0 (27%) 29% Europe (excl. Switzerland) 85.8 59.8 113.2 (24%) 43% Asia (incl. Middle East) 24.2 15.3 17.8 36% 58% Total net fee income 170.0 121.6 213.0 (20%) 40% Staff breakdown
Slide 26: Weekly Economic Revenues H1 2021
WEEKLY ECONOMIC REVENUES H1 2021 Weekly economic revenues (CHF million)1 30 25 20 15 10 5 0 -5 Jan Feb Mar Apr May Jun 1 Economic revenues are defined as sales and trading income earned and are considered as recognised at trade date without applying IFRS revenue recognition rules; economic revenues
Slide 27: 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