Kempen European High Dividend Fund N.V. N · EURONEXT:KEHDF
Kempen European High Dividend Fund N.V. N — Van Lanschot Kempen — FY2023 Earnings Presentation
31 slides from Kempen European High Dividend Fund N.V. N's earnings presentation, Feb 22, 2024
Slide 1: 2023 full-year results
ee 2023 full-year results 22 February 2024
Slide 2: The year in review
The year in review Our clients Our employees Society Our shareholders • Continuing growth of • Focus on the • Focus on energy and • Dividend proposal of clients and net inflows development and food transitions €2.00 per share • Renewed interest in throughflow of • Continued annual • Continued fixed
Slide 3: Achieving sustainable and profitable growth
Achieving sustainable and profitable growth Organic growth • Strong net AuM inflow (€5.3bn) AuM development Bolt-on Bolt-on acquisitions acquisitions • Complete integration of Mercier Completed integration of Mercier Vanderlinden •Vanderlinden +18% • AcquisitionofofRobeco Robeco’s online investment
Slide 4: Progress towards our sustainability goals
Progress towards our sustainability goals Lower carbon emissions Discretionary (AuM) 88% of funds on track for reduction of 7% average annual emission intensity in line with Paris Agreement Target: 80% of funds comply with 7% average annual emission intensity reduction Mortgage portfolio -6.9% total
Slide 5: Working towards our medium-term financial targets
Working towards our medium-term financial targets Cost/income CET 1 ratio RoCET 1 Dividend ratio pay-out ratio* 71.6% 19.6% 14.2% 68.6% Target: Target: Target: Target: 70 % 17.5% including 12.0% 50 – 70 % 2.5% M&A add-on * Proposed dividend payment / underlying net result attributable to shareholder
Slide 6: ee
ee
Slide 7: 2023: Key messages
2023: Key messages Net result of €125.2m (2022: €84.3m): • Commission income +5% • Interest income +21% • Operating expenses +8% Net AuM inflow: €5.3bn • Private Clients net inflow: €2.3bn • Wholesale & Institutional Clients net inflow: €3.1bn Segment operating profit before tax: • Private Clients:
Slide 8: 2023: Performance
2023: Performance Net result €125.2m Commission AuM Strong capital position (2022: €84.3m) income €427.2m €127.6bn CET 1 ratio 19.6% (2022: €407.8m) (2022: €107.8bn) (2022: 20.6%) Underlying net result Interest income AuM net inflow RoCET 1 at 14.2% €130.5m €196.5m €5.3bn (2022: 12.3%) (2022: €117.8
Slide 9: Net result amounts to €125.2m
Net result amounts to €125.2m Key drivers of net result (€ m) 10.0 -36.7 33.8 28.5 -5.4 19.4 -8.7 137.5 125.2 125.2 103.7 110.7 102.0 102.0 84.3 84.3 2022 Commission Interest Other income Operating Impairments Expenses Other** 2023 income income* expenses related to accounting treatment Mercier Vand
Slide 10: Overview of net result
Overview of net result €m 2023 2022 % change Commission 427.2 407.8 5% - Of which securities commissions 389.8 350.4 11% - Of which other commissions 37.4 57.4 -35% Interest 196.5 162.7 21% Other income 39.1 29.2 34% Income from operating activities 662.8 599.7 11% Operating expenses -474.8 -438.2 8
Slide 11: Private Clients: High net inflows
Private Clients: High net inflows AuM (€ bn) 5.0 4.7 2.3 52.4 47.5 40.5 40.5 42.8 31/12/2022 Net AuM inflows Market Acquisition 31/12/2023 performance • Net inflows: 71% non-discretionary, 29% discretionary • Q1: strong inflow in non-discretionary AuM from excess savings, increased client holdings i
Slide 12: Private Clients: Strong net AuM inflow in Belgium of €0.8bn
Private Clients: Strong net AuM inflow in Belgium of €0.8bn • After a successful integration we continued as Mercier Van Lanschot from 1 January 2024 • Private Clients Belgium will be reported as a separate segment from 2024 • Intended acquisition of Belgian investment adviser Accuro, expected to be
Slide 13: Private Clients: Positioning Evi van Lanschot for further growth
Private Clients: Positioning Evi van Lanschot for further growth • Good progress on integration of Robeco’s online investment platform • Acquisition created a leading online investment platform for mass- affluent clients, with AuM of €6.4bn • Well on track with the integration with one-off transitio
Slide 14: Wholesale & Institutional Clients: €3.1bn net inflow
Wholesale & Institutional Clients: €3.1bn net inflow AuM (€ bn) 4.7 2.8 0.5 -0.2 69.9 70.4 75.1 67.3 67.2 67.2 31-12-2022 Net Investment Net Fiduciary Net Alternative Market 31-12-2023 Strategies Management Investment performance inflows inflows Solutions inflows • Investment strategies: net outflow
Slide 15: Stable margins at both Private Clients and Wholesale & Institutional Clients
Stable margins at both Private Clients and Wholesale & Institutional Clients Annualised recurring fees* (€ m) AuM breakdown (~%) 11% 25% Private Clients 64% 379.8 414.7 359.5 329.6 339.8 306.9 22% 26% Wholesale & Institutional Clients HY2021 YE2021 HY2022 YE2022 HY2023 YE2023 53% Equities Bonds Othe
Slide 16: Investment Banking Clients: Challenging markets due to increasing interest rates
Investment Banking Clients: Challenging markets due to increasing interest rates Commission income (€ m) 55.3 56.0 36.5 2021 2022 2023 • Operating result before tax of -€4.4m (2022: €9.7m) • Rising interest rates put pressure on deal activity in real estate sector • We adapted our organisation to ma
Slide 17: Net interest income: client behaviour main driver
Net interest income: client behaviour main driver • In the first half of the year, clients converted on-demand savings into AuM, mainly fixed income • In the second half, client demand for term deposits accelerated • Clients switched back to savings rather than reinvesting the proceeds from maturing
Slide 18: Interest margins improved in 2023
Interest margins improved in 2023 Interest income (€ m) Interest margin (12-month moving average, %) 1.24% 1.18% 107.9 0.92% 93.0 88.6 0.88% 76.1 77.5 69.7 H1 2021 H2 2021 H1 2022 H2 2022 H1 2023* H2 2023* H1 2022 H2 2022 H1 2023 H2 2023 Interest margin* • Interest income stabilised in the second ha
Slide 19: Higher result on other income mainly driven by the sale of a participating interest
Higher result on other income mainly driven by the sale of a participating interest €m Income Income Book Book value value 2023 2022 YE2023 YE2022 Van Lanschot Kempen Participaties 28.4 10.1 35.0 47.8 Bolster Investments Coöperatief UA 3.9 6.3 76.3 63.1 Co-investments in own investment funds (incl.
Slide 20: Operating expenses: Focus on scalable growth
Operating expenses: Focus on scalable growth Operating expenses (€ m) Internal FTEs 19.0 17.7 55 5 457.1 474.8 1,780 1,844 1,844 1,899 1,904 438.2 438.2 2022 H1 2023 Robeco's Other H2 2023 2022 Staff costs Other 2023 online investment platform • Increase in staff costs, mainly driven by a higher num
Slide 21: Loan portfolio
Loan portfolio €m Loan Loan % change Impaired Provision Impaired Coverage portfolio portfolio loans ratio ratio 31-12-2023 31-12-2022 Mortgages 6,368 6,341 0% 27 2 0.4% 8% Other loans 2,182 2,371 -8% 98 25 4.5% 26% Loan portfolio 8,550 8,712 -2% 125 28 1.5% 22% Mortgages distributed by third parties
Slide 22: Additions to loan loss provisions
Additions to loan loss provisions Additions to loan loss provisions (€ m) Loan loss provision per stage (€ m) -29 bps* -19 bps* 5 bps* 2.0 42.4 Stage 3 26.9 27.7 Stage 2 Stage 1 7.0 6.1 3.5 3.6 4.4 6.1 -7.7 31-12-2021 31-12-2022 31-12-2023 -11.7 • Loan loss provisions relative to average risk- 2021
Slide 23: Strong CET 1 ratio at 19.6%
Strong CET 1 ratio at 19.6% Dividend proposal of €2.00 per share (total €85.0m) Common Equity Tier 1 ratio (%) 0.8 0.8 -1.9 -0.5 -0.2 20.6 18.7 18.7 19.5 19.8 19.4 19.6 31-12-2022 Capital return Shares issued Retained Operational Other 31-12-2023 regarding profit risk Mercier Vanderlinden • CET 1 ra
Slide 24: Solid capital position
Solid capital position Continued commitment to return excess capital • Our intention remains to return excess capital above 17.5% CET 1 ratio target to our shareholders going forward Total shareholder return (€ m) Total capital return €146m 85 85 74 61 Capital return Dividend 2022 Capital return Pro
Slide 25: 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% 19.6% 65% 67% 69% 57% 53% 2019 2020 2021 2022 2023 2019 2020 2021 2022 2023 Cost/income ratio Return on Common Equity Tier 1* 70% 12% medium-term m
Slide 26: 2023: Performance
2023: Performance Net result €125.2m Commission AuM Strong capital position (2022: €84.3m) income €427.2m €127.6bn CET 1 ratio 19.6% (2022: €407.8m) (2022: €107.8bn) (2022: 20.6%) Underlying net result Interest income AuM net inflow RoCET 1 at 14.2% €130.5m €196.5m €5.3bn (2022: 12.3%) (2022: €117.8
Slide 27: Appendix
ee Appendix
Slide 28: Key figures by segment: 2023
Key figures by segment: 2023 €m Private Wholesale & Investment Other Total Clients Institutional Banking Clients Clients Commission income 306.4 79.2 36.5 5.0 427.2 Interest income 184.7 0.4 -0.3 11.7 196.5 Other income 1.3 0.1 2.1 35.6 39.1 Income from operating activities 492.4 79.7 38.4 52.3 662.
Slide 29: Progress on our non-financial KPIs
Progress on our non-financial KPIs 29
Slide 30: High scores on external ESG ratings
High scores on external ESG ratings Governance: 2 B- rating Lower governance risk = 1 On a scale of A+ to D- Higher governance risk = 10 ISS ESG Corporate Rating 6th place in league table of AA rating 491 entrants On a scale of AAA to CCC on resilience to ESG risks 11st place in a league table 4 and
Slide 31: 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