Valartis Group presents its results for the first half-year 2011
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Valartis Group AG /
Valartis Group presents its results for the first half-year 2011
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Valartis Group made further progress in the first half of 2011 in implementing
its new strategic focus on the private client business. Net new money inflows
more than doubled to CHF 577 million in the first half of the year compared with
the prior-year period, despite the difficult market environment. Therefore,
client assets under management overcame negative currency effects to rise to CHF
6.5 billion. While net interest income decreased slightly, net commission income
rose 59 percent to CHF 35.9 million. In addition, the Group invested in its
back-office systems to provide a solid technical base for growth going forward.
Due to negative currency effects and a non-operative valuation adjustment on the
associated companies of CHF 28.8 million, Valartis Group posted a loss of CHF
19.9 million for the first half-year 2011.
Strategic focus on track
At the operating level the Valartis Group ended the first half-year 2011
successfully, against the backdrop of a difficult market environment featuring a
strong Swiss franc, uncertainty with corporate and public-sector bonds, and a
deteriorating economic outlook. Net commission income was 59 percent higher than
in first-half 2010, increasing to CHF 35.9 million at 30 June 2011 (30 June
2010: CHF 22.6 million). The Group's acquisitions of the last two years played
an important role in this. Net new money inflows totalled CHF 577 million, more
than double the volume compared to the prior-year period (30 June 2010: CHF 202
million).
Net interest income was only slightly lower compared with the first half of
2010 at CHF 24.5 million (30 June 2010: CHF 26.9 million). The bond portfolio,
one of the main sources of interest income, performed well thanks to active
portfolio management.
The Group's strategic refocusing on private client business has so far proved
successful and is developing in line with the mid-term financial plan. The
results of core operating activities, that is net profit excluding valuation
adjustments and depreciation on intangible assets from acquisitions, increased
to CHF 7.0 million. This is especially noteworthy given the fact that revenues
are largely received in foreign currencies whereas costs are incurred for the
most part in Swiss francs.
Increase in managed assets, but currency effects have adverse impact
Client assets were down 6 percent or CHF 372 million due to the strong Swiss
franc and the negative trend on the financial markets. However, net new money
inflows were a robust CHF 577 million, so that total assets under management
were nevertheless able to increase to CHF 6.5 billion (31 December 2010: CHF
6.3 billion).
Client assets under management were distributed between the two business
segments as follows: Private Clients with CHF 4.6 billion (71 percent; same as
prior year) and Institutional Clients with CHF 1.9 billion (29 percent). The
Private Client segment accounted for 65 percent, or CHF 373 million, of the net
new money inflows of CHF 577 million, while the Institutional Clients segment
was responsible for 35 percent, or CHF 204 million.
Group net profit - net loss due to non-operative impairment charges
The solid result from the operating activities of Valartis Group were materially
affected by the first-half results of Eastern Property Holdings Limited (EPH),
in which the Group holds a stake of about 38 percent. The real estate company,
which is quoted on the SIX Swiss Exchange and invests in commercial properties
in Russia (in particular Moscow and St. Petersburg), is accounted for as an
associated company within the consolidated financial statements of Valartis
Group using the equity method as per International Financial Reporting Standards
(IFRS).
Due to the reassessment of valuations in the real estate portfolio, the net
asset value of EPH has declined from around USD 80 at 31 December 2010 to around
USD 69 at 30 June 2011. This results in negative non-operative valuation
adjustments on the associated companies of the Valartis Group totalling some CHF
15.9 million, which together with negative US dollar exchange rate effects of
CHF 12.9 million, have an adverse impact on the other ordinary income of the
Valartis Group of CHF 28.8 million.
Given this material valuation adjustment, which is recognised in the income
statement, Valartis Group will close the first half-year 2011 with a loss of CHF
19.9 million (30 June 2010: profit of CHF 7.0 million).
The segment result before amortisation for Private Clients was CHF 0.1 million
(30 June 2010: CHF -2.1 million), and for Institutional Clients it was a loss of
CHF 15.5 million (30 June 2010: CHF +13.6 million). Since income from associated
companies has been recognised in the Institutional Clients segment so far, the
valuation adjustments on EPH will also be recognised in the segment result of
Institutional Clients.
Investing in the future
During the first half-year 2011 Valartis Group continued to invest in its
technical infrastructure. As part of the «Global Partner» project, the execution
of securities transactions and the back-office processes and procedures have
been highly automated per July 2011. This means that the anticipated increase in
client assets under management over the next years can be managed and
administered without having to hire more personnel for the back office. Thus,
income can be increased while keeping the cost base stable.
The half-year report 2011 of the Valartis Group can be downloaded in PDF format
from our homepage www.valartisgroup.ch.
If you have any queries, please contact:
Gustav Stenbolt, CEO Valartis Group, Tel. +41 43 336 81 11
--- End of Message ---
Valartis Group AG
Sihlstrasse 24 Zürich
Media release including key figures (PDF):
http://hugin.info/143135/R/1540300/470935.pdf
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Source: Valartis Group AG via Thomson Reuters ONE
[HUG#1540300]
Unternehmensinformation / Kurzprofil:
Datum: 23.08.2011 - 07:00 Uhr
Sprache: Deutsch
News-ID 58032
Anzahl Zeichen: 7365
contact information:
Town:
Zürich
Kategorie:
Business News
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