eQ PLC STOCK EXCHANGE RELEASE
8 May 2014, at 12:30 p.m.
eQ PLC’S INTERIM REPORT 1 JANUARY TO 31 MARCH 2014 – RESULT OF CLIENT OPERATIONS SHOWED STRONG GROWTH
January to March 2014 in brief
- During the period under review, the Group’s net revenue totalled EUR 4.4 million (EUR 5.7 million from 1 Jan. to 31 March 2013).
- The Group’s net fee and commission income totalled EUR 4.5 million (EUR 3.5 million).
- The Group’s net investment income from own investment operations was EUR -0.1 million (EUR 2.3 million).
- The operating profit of client operations (Asset Management and Corporate Finance) was EUR 1.5 million (EUR 0.5 million).
- The Group’s operating profit was EUR 0.9 million (EUR 2.2 million).
- Earnings per share were EUR 0.02 (EUR 0.04).
- The assets under management totalled EUR 6.8 billion at the end of the period (EUR 6.7 billion on 31 Dec. 2013).
- The net cash flow from own investment operations was EUR 1.9 million (EUR 3.8 million from 1 Jan. to 31 March 2013).
| Key ratios | 1-3/ 2014 | 1-3/ 2013 | Change % | 1-12/ 2013 |
| Net revenue, Group, EUR million | 4.4 | 5.7 | -23% | 18.8 |
| Net revenue, Asset Management, EUR million | 3.3 | 3.2 | 3% | 13.6 |
| Net revenue, Corporate Finance, EUR million | 1.3 | 0.4 | 206% | 2.2 |
| Net revenue, Investments, EUR million | -0.2 | 2.2 | -108% | 3.0 |
| Net revenue, other segments | ||||
| and eliminations, EUR million | 0.0 | 0.0 | 79% | 0.0 |
| Operating profit, Group, EUR million | 0.9 | 2.2 | -60% | 4.9 |
| Operating profit, Asset Management, EUR million | 1.0 | 0.5 | 109% | 3.1 |
| Operating profit, Corporate Finance, EUR million | 0.5 | 0.0 | 2352% | 0.4 |
| Operating profit, Investments, EUR million | -0.2 | 2.2 | -108% | 3.0 |
| Operating profit, other segments, EUR million | -0.4 | -0.5 | 10% | -1.6 |
| Profit for the period, EUR million | 0.7 | 1.5 | -55% | 3.4 |
| Earnings per share, EUR | 0.02 | 0.04 | -50% | 0.10 |
| Equity per share, EUR | 1.87 | 1.89 | -1% | 1.97 |
| Liquid assets and interest-bearing receivables, EUR million | 14.5 | 14.3 | 2% | 11.3 |
| Private equity investments, EUR million | 29.7 | 34.9 | -15% | 30.6 |
| Interest-bearing liabilities, EUR million | 0.0 | 4.0 | -100% | 0.0 |
| Assets under management, EUR billion | 6.8 | 6.5 | 4% | 6.7 |
Janne Larma, CEO
The first months of the year have been a restless time in the equity market. Developed markets have managed to maintain their position reasonably well, however, and the MSCI World Index rose by 1.3 per cent in the first quarter. The greatest looser has been the Russian equity market with a fall by about 14 per cent due to the uncertainty caused by the crisis in Ukraine, and the emerging markets in general have fallen slightly from the beginning of January. Long interest rates have come down since the beginning of the year and given investors good yields.
eQ Asset Management’s sales were excellent in the first quarter. Our net sales in funds registered in Finland totalled about EUR 150 million. The eQ Emerging Dividend Fund saw the greatest increase, and its size grew to EUR 226 million by the end of March. The fund continued with its growth in April as well. The new subscriptions in the eQ Care Fund totalled EUR 30 million in the first three months of the year. After the period under review, the eQ PE VI North investment programme established by eQ Asset Management grew by EUR 20 million to EUR 84 million, as the fund had its second close. The final close will take place before the end of June 2014, the overall target being at least EUR 100 million.
The business operations of Advium also developed in a positive manner during the first months of the year, and it acted as advisor in five transactions during the first four months. Advium acted, e.g. as advisor for Sanoma in the sale of the Sanomatalo office property in the city centre of Helsinki and, after the end of the period under review, as advisor for Pöyry Plc, as the company sold a major part of its real estate planning, consulting and construction operations in Finland to Ramboll Finland Oy. The arrangement will require approval by competition authorities.
In the first quarter, the result of client operations grew markedly from the previous year. The operating profit of Asset Management was doubled to EUR 1.0 million from EUR 0.5 million in 2013. The improvement is partly due to larger returns but also to the lower costs resulting from synergy effects. The result of the Corporate Finance segment grew clearly and the operating profit was EUR 0.5 million, as compared with last year’s EUR 0.0 million. In the Investments segment, the net cash flow was EUR 1.9 million positive, but the operating profit remained EUR 0.2 million negative due to permanent write-downs of EUR 0.7 million.
The balance sheet of the Group is in excellent shape. At the end of March, the Group’s liquid assets and interest-bearing receivables totalled EUR 14.5 million, while the balance sheet value of the private equity investments was EUR 29.7 million.
We will continue with the year in a confident spirit. We strongly believe that the services offered by eQ Asset Management are competitive and raise interest among investors. We also believe that Advium will take advantage of the rising corporate transaction and real estate volumes.
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eQ’s interim report 1 January to 31 March 2014 is enclosed to this release and it will also be available on the company website www.eQ.fi.
Additional information: Janne Larma, CEO, tel. +358 40 500 4366
Distribution: NASDAQ OMX Helsinki, www.eQ.fi
eQ Group is a Finnish group of companies specialising in asset management and corporate finance business. eQ Asset Management offers a wide range of asset management services (including private equity funds) for institutions and individuals. The assets managed by the Group total approximately EUR 6.8 billion. Advium Corporate Finance, which is part of the Group, offers services related to mergers and acquisitions, real estate transactions and equity capital markets.
More information about the Group is available on our website at www.eQ.fi.
