Hypoport SE (HYQ) Earnings Call Transcript & Summary

[Audio Gap] Delivered growth. We ended up with a total of 40 -- oops, we ended up with a total EUR 446 million revenue. New record high, a double-digit growth as we obviously promised. And outperformed this even on the profitability side and EBIT plus of 32% to EUR 47 million, EUR 47.7 million to be exact. We outperformed our guidance, which was 40 to 45, thanks to some additional -- let's say, a perfect environment for our corporate finance entity here in the second half of the year, one in the first half, we had to do another. We'll come to this in more details later. So strong numbers in a more or less a flat market environment here in Germany. And talking about market environment, I would like to go a little bit more in detail to answer a lot of questions that we received lately from investors. What's going on in the German housing market and our mortgage business, our credit business is pretty linked to this as well. So first, a short view to the long-term development on the demand side of housing here in Germany. And we highly emphasize that you should look on the long-term trends. And long-term means the last 5 years and the next 5 years, and these trends are pretty similar because everything -- what happens on the short term on a monthly or a quarterly basis is not as relevant as what's going on, on this long-term trend. First of all, we had a net migration to Germany pre-corona, slowed down during corona slightly, but will come back. And actually, with the current crisis, the Russian war against Ukraine, we see already a huge net migration again to Germany. This will keep going -- staying like this because Germany is just a very attractive labor market in the European Union. So when you compare the chances for -- someone in the periphery of Europe and here in the center of Europe to receive an outstanding income, there is a huge incentive to come here. This is driving demand [ following ]. Next one. The surviving demand for housing is increasing life expectation. In the past 5 years, we added a month every year. I expect this as well for the next 5 years that we had the month every year. So people are getting old in Germany. And together with the fact that they are staying in their -- used -- in their living space which they are used to, and we see there are more and more single personal households here in Germany, they increased the number of households needed as well. What changed in the last 2 years and will not -- will affect the next 5, it will not damage again, is that your own 4 walls, your home got much more important for especially the upper 1/3 of the German households. They realized during the first lockdown already 2 years ago that, let's say, quality space and private quality space is needed. And now we are for 2 years in a pandemic environment, and everyone learned the hard way that you need a balcony. It's even better to have a terrace and even better to have some garden-like thing around your house to, yes, let's say, to feel about. And the demand for this kind of space increased rapidly in the beginning of the lockdown, and it keeps staying high. Families are migrating to new apartments. That's more out of space or even buying homes out of the city and migrating to work because it is just more interesting and, let's say, more -- yes, it feels better for families and young couples to live that way. Additional change, which started or let's say, which was actually accelerated, I think, is working from home, it was technically for a long time possible. But the society, the acceptance in society that you work from home by companies changed heavily with the lockdowns. So today, we are pretty used to work from home, and the bouncing back is still slow. So people need the working space at home. They need to have remote office. And typically, in Germany, both people work. So you need 2 remote offices, and close to no family had this kind of space at home. If you add home schooling for the children, there is a lot of infrastructure and space needed, and this adds up to much more living space required per household in the upcoming future. So this combined with the numbers of households increasing, we see a huge demand right now. And looking forward for the next 5 years, an increasing demand for housing here in Germany. So on the supply side, there are 2 segments which supply housing. One is the sales of existing properties. The other is new construction. On the sales side of existing properties, the increasing life expectations reduced the supply. We have pretty high transaction costs here in Germany. You can say if a broker has included roughly 15% of the property value is the transaction cost. This limit, especially for elderly people to reduce their living space because even when they stay in the exactly same quality level and it doesn't change quality and location at all, 15% are lost just because of transaction costs. We have a pretty -- in transparent market as well, it's another, I would say, 10%. And so if you decide to downsize, you need to downsize more than 25% just to -- and then you still pay the same in the end. You didn't get any equity released out selling your old home. This is pretty drastic. And together with the, let's say, the social and emotional link to the current properties, lots of elderly people refuse to downsize their space. So there are less properties coming to the market than compared to 5 or 10 years ago. Another source always there that people who bought an apartment for renting as an investment later sold it and realized profits. While they are sitting on huge profits, thanks to the very dynamic increase in prices here in Germany, the alternative investment options are limited. So with last year, secure investments still with a negative return, it stayed interesting to keep -- to stay invested in your current rented departments. So the supply from this site was low as well. Looking forward, this may change actually, yes, for the next 5 years because when interest rates slightly rise, you get alternatives, and with a pretty low return on equity invested on rented space. This may change. It may actually increase the supply side in the next upcoming 5 years. The other things will not change. Transaction costs will stay high, and large expectation will stay -- will keep increasing. So the other thing is supply -- new construction as a supply side. Here, we have increased regulation in the last 5 years. And we expect to increase the regulation further, which drives the prices up for construction in Germany. You can say today, it's not possible in its regulatory environment to build living space below EUR 3,000 per square meter without the cost of the ground. So the highly regulated building, and this is -- it's a core problem for new construction, especially in the highly regulated renting market, It just not pays back with a reasonable return on investment, so it's just not being built. On the other side, we have as well as a limiting factor labor and resources with a high price increase, especially during the last year, which limits as well the supply side. So we, let's say, increased the supply of your construction in the last 5 years from roughly 250,000 units per year to 300,000 units per year. But when you compare this with the demand of roughly 2 million apartments in the metropolitan areas, you see that there is a huge mismatch, and we are not successful in ramping up new construction. Looking forward, this will not change. Even when there's a political announcement that our new government will try to increase the supply side with new construction to 400,000 units. There's actually no master plan behind this, how to achieve this. We see more and more regulation coming. We expect more regulations to come if the resource side keeps staying limited. So I would expect a stable or slightly even decrease in your construction volume over the next 5 years. So all in all, supply side in best case, roughly stable for the housing market. So high demand. And looking forward, increasing demand in housing. On the one side, supply side is stable means prices rise, property prices faster than rents because rents are, over the last 5 years, highly regulated. This makes it more -- less interesting and less probable that new apartments for renting is built. And this leads to a huge pressure in this market. And when you -- let's say, when you cap the prices in a product, you increase the waiting period. So to get demand in apartment is extremely difficult. Quality of rented apartments are lower than in 5 years ago, and they will drop in the next 5 years. So we see more and more segregated housing market here where renting units and quality go down, while owner-occupied apartments in quality stay stable or go up and -- but with a heavy price deck because this additional pressure out of the renting market, which forces people to buy properties increases the dynamic in the property price segment even more. Last year, we saw a price increase of 13%, highest ever in the last decade. Yes, this -- let's say, this was shocking for the buyer side. And because of still low interest rate or stable interest rate environment, people hesitated especially in the second half of the year to close transactions. For the future, we expect that linked to the interest rate, the property sales title will speed up or slow down. So every time when we see an increase in interest rate, it will speed up. And we see a slow -- when we see a decrease in interest rate, we will see a slowdown of the transaction speed. And this may, on a quarterly basis, change the transaction volume slightly on the long run. It's just important that a limited amount of properties is coming to the market with increasing prices, so the volume of prices will slightly go up. This is something we saw in the last 5 years and which we expect for the next 5 years as well. So on a quarterly basis, some fluctuation on long term, just a stable trend. And this leads together with an increased amount of equity, which is accumulated in this household stock, plus the lack of alternative investment opportunities. So more equity is invested in housing that the mortgage volume there just every year slightly go up. So we expect for the next 5 years, even with an inflation rate of something around 5% actually, that the mortgage volume will grow on this speed or slightly slower. This said, it means it's a pretty stable and attractive market environment for Hypoport, even when there is no dynamic coming from the market. And all the talks about, is there a price bubble here in Germany may interest -- made a sharp increase in interest rates, deflate this prices. And will the market come down from its current transaction volume is from a very far distance and outsiders. The reality is that families for the last 5 years acquired apartments or houses when they needed it because they had another child or they just started to live together, not because of any interest rate or any housing prices. You as a young family, you will always adjust your demand in quality and location. So how far are you willing to drive from work to your home to your capabilities on the financing side? So it means increased interest rates may lead to further commuting distances but not to less transactions. So short on what happened last year influenced our 2021 numbers and what will change in 2022. We saw a slowdown in migration, thanks to the Corona environment, the lockdowns, and so there are more difficulties to resettlement in Europe. But it's changed already right now with what's going on as a result of the attack of Russia in the Ukraine. And looking forward, we expect a huge dynamic in the European labor marketing already in 2022 and lots of people moving here to Germany because we lack workforce. And we have a lot of jobs to hand over to people, yes, well-paid jobs. The rise of interest rate, it started in the beginning of December and had a direct impact on transactions because now it costs you money when you wait. So the sales cycles for properties decreased since the beginning of December. Waiting cost your money on the mortgage side. So before this, you just, let's say, waiting costed your money only on the increasing prices of properties. Now it costs you money on both sides. People start to act faster to drive transaction faster through the gate. Yes. In general, looking back on 2021, we can say that overall industries, acquiring new clients, we're still affected and lower than in a normal market environment because it's really difficult from a remote distance to convince a client to migrate to your IT infrastructure and drive an important IT project forward. So we see that the speed of new clients in the different entities could have been higher if we would not have seen this pandemic environment. Last but not least, looking back at 2021, we had a change in government here. While the old government still initiated a pretty well subsidy structure for the transformation of our energy sector, people hesitated to actually make investment decisions on all levels because they wanted to see how does the new government act. And you can say the new government is in place now. There are a lot of promises out there for housing, for energy sector. They just need to live up to these promises as soon as possible. Now comes some additional promises linked to the change in the political environment. Part of this is as well energy. So we should expect if politicians walk the talk that we will see huge subsidies for an energetic transformation here in Germany, which would be great for 2022 if they are realized as soon as possible. So much about the market environment for 2021. Let's look on the performance of our 4 segments. We start as always with the core, Europace and credit platform. New [indiscernible], close to EUR 100 billion in mortgages transacted last year. Growth coming from all banking sectors. Growth coming from all product areas, excluding building site finance, which was down by 1%. It just didn't make a lot of sense to secure long-term interest rate via this product, then you just could enhance and prolongate your -- increase the duration of your fixed interest at invested mortgage. So the product was not so needed. All other mortgage products grew even faster. As you can see, there's a pretty high dynamic when you compare the market share gain or the volume gain of Europace with the overall growth of the market of 4%, so in a high dynamic of market share gains in all segments for Europace. So we gained market share in the core, in the mortgage broker market where we are above every segment transaction now and keep growing. Broker markets keep growing, taking market share from all 3 bank branch networks. And with this, we already created a double-digit growth as a base effect here. Commercial banks were growing as well because the ones using Europace outperform the ones not using Europace. For us, no surprise. No black swan was seen in 2021, so no large here in dark rate banking organization decided to migrate and started the process. But we are in good talks as always with them. And let's say, the dynamic that we deliver in the development of Europace is increasing the pressure, and so the Christian states when they start to act and not if. And maybe it's a good moment actually to -- for especially the English-speaking community here to focus on our newest initiative here on Europace, the One Click mortgage. So we introduced just a couple of weeks ago to Germany that we have a fully automated underwritten mortgage for the first time in history. Even the confirmation process by the banks is limited to 4 hours, and this got a lot of media attention here and a lot of attention from banks because it's for the first time such an innovation is not driven by a single bank but by a platform with a couple of banks behind already. And the whole industry is interested in how we are actually doing this because the current processing cost and time for mortgage is far above this, what you can achieve with this One Click mortgage.. And talking about this private banks here, which still hesitate to add this kind of innovation, which we are bringing here to the market. It will drive everyone sooner or later on the Europace system because you just can't otherwise compete anymore with the rest of the market, and this is a pretty set perspective on your future. Looking to the Ritual Banking Group. We saw some strong performance again in 2021. The cooperative banking sector, plus 57%. Could have been more, to be honest, if we would have a more -- a not so remote environment, let's call it, so if there would have been more physical interaction with the client possible. We are still in the rollout process there. So we need to convince clients to do the next step, and this is easier in physical meetings than remotely. But let's say, we are happy with 57% growth here. And we know that we will keep growing further in 2022 as well here with a high double-digit number. On the Savings Bank side, plus 26% as well affected from the Corona environment. It's a -- let's say, even within this semi space organization, we're on a growth track. We expect them that they lost some market share in 2021 to the other banking groups because of their lack of dynamic. We are there. As you know, we teamed up with their centralized IT service provider ready to deliver. They just need to act. Who is not going to act if they're going to lose market share? But they are. Let's say 26% is still a growth rate. But here, we would expect actually an acceleration after the pandemic environment ends here. Okay. Next, and new for you, we focus a little bit on the different credit products outside of mortgages as well because they have a substantial impact on our growth track. First is personal loans, 17% in the negative market environment last year. Yes. So we are growing in personal loans. It's a very attractive product area, and it's highly competitive. Yes. What is our focus is independent advice on one side. And on the other side, banks which are limited in their own capabilities to fulfill the risk and pricing interest of their clients. And with a dynamic market environment and with a lot of restrictions on banks on their balance sheet, this is a dynamic growing markets for us right now. So banks are able to broker personal loans to other banks in case that there is no product fit to the demand of the client. We have a high percentage of restructuring in this brokered personal loan portfolio because of the section we are using. So we are not as -- not so strong as Europace or not focused on simple personal loan products. So for instance, linked to a washing machine or car sold on the point of sale or on the Internet for someone who just wants a couple of EUR 100 or a couple of EUR 1,000. We are focused on consumers, which are more complex debt structure already. So meaning they closed a couple of simple personal loans and realize in some moment that their household cash flow on a monthly basis and is stressed by this. And using Europace, you are able to optimize this. And so it's a more complex technical problem as well to join these loans and restructure this and get a better rate typically than you had previously, a slightly longer duration. This way, you save a lot of money on your monthly account. So we are helping consumers to get out of this trouble, and let's hope that they don't use this additional gain resources on additional loans for simple products. But as what we see, we're adding a lot of value to the consumer market after too easy underwritten personal loans on the point of sale. We expanded our sales activities to the savings banks area, together with our FINMAS venture and founded a new joint venture in the competitive banking sector with TeamBank, the centralized personal loan provider for the cooperative banks to reach the whole sector there and enable them next to the balance sheet as well to broker personal loans. So next, Corporate Finance. Here, we have 2 entities, REM CAPITAL after an acquisition 3 years ago, scaling heavily in the advice process of German middle stand. So corporates with a capital lead of a couple of million euro upwards. And our funding platform, the digitalizing -- the digitalized process between distributors slide REM CAPITAL and others and banks to finance this. REM CAPITAL increased their sales force over the last couple of years steadily, which resulted last year in an increase of sales platform and a project of plus 40% in combination with the increased availability of subsidies for the energy transformation. Especially in the second half of the year, this was a huge gain in traction and profitability. And looking forward for 2021 -- sorry, 2022, it's not certain that we can get again this intensity in this productivity. It is heavily linked to the availability of subsidized offerings from the government, which is still not clear in which volume it will be available. But it's an organic growth track. REM CAPITAL is on here. And it will keep growing the next years, even then 2021 was pretty amazing here, yes. On fundingport, we are better together with the first third-party distributor, IKB Bank. We see the first transaction on the platform. We signed up a couple of dozen banks to provide loans to German Mittelstand platform here. So we expect to enter -- let's say, to go live, enter alpha state, you can say, in the next couple of months. And then you will see here transaction numbers for fundingport in the REM CAPITAL going forward. So as a result of a great performance in all product segments, new record numbers for the segment, more than EUR 200 million revenue and outperformance of profitability because, as you know, we try to increase our R&D together with our revenue. Just the perfect performance of REM CAPITAL made it possible this year. So there is a clear outperformance of the profitability that we show even when we increased investments in mortgage, in personal loans and in corporate finance within this segment here. So coming to private clients, our Dr. Klein franchise network, using Europace as a transaction tool acquiring clients or leads for our franchisees online and organizing the value chain here and being a distribution power here in Germany now. Dr. Klein grew by 9% to a volume of close to EUR 10 billion last year. To sort this a little bit out, we had an amazing performance in 2020, so thanks to our capabilities to advise clients remotely via video. We had great conversion rates better than the -- far better than the rest of the market in the early stage of the pandemic. This advantage, we partially lost in 2021 because competitors learned from us, you can say. Other Europace users learned from Dr. Klein how to act and got again more competitors -- competitive. So there were some, let's say, base effect in this year. So the growth to this EUR 10 billion is already a pretty good development again in an over market environment, which has 4% growth. So expect this to be double digit in 2022 again without this base effect. And the basis for this are 8% of additional advisers in our network, so more head count because even a fully digital One Click mortgage needs an advice from the -- for the consumer. He needs to understand what he is going for even when it's a faster process. And with this additional workforce here on the advice side, we will scale the numbers of advisers and with increasing mortgage transactions and volume in average, we will see a double-digit growth of Dr. Klein in 2022 as well. But first, back to 2021, record numbers, outperformance on the profitability side. You see a scaling effect here on such a lead-generating franchise system on one side. On the other side, we had the same cost savings, thanks to the remote environment, I would say, roughly a billion euro -- a million euro will be saved this year, let's say, compared to a normal environment. So then we will have to host conferences again. Our people have to travel about more to support and train franchisees, then it will get a little bit more costly again to run this business. But this -- you see the EBIT margin that's outstanding right now. It may come back slightly after the pandemic environment. Okay. Then our 2 new segments. We started real estate, which is pretty linked to the mortgage market. Just to give you a better understanding which markets we target. Out of a living space here in Germany of roughly 40 million residential units, half of them are owner-occupied, and we address this market with Europace and with the activities here in the segment. As well here in the segment, we address the social housing activities of the municipal and operated/owned housing industry, roughly 6 million apartments, 16% market share, you can say. What we don't -- usually don't address as a market is this renting market of semi-professional and professional private landlords. It's not something which is easy transacted via UPAS. As soon as someone has multiple apartments, the credit check gets more complicated. So we -- for now, we stick with the really simple ones. You have 1 or 2 units, not the complex ones which do this in some kind of semi-professional business already. And in a moment when it gets bigger, when you own a whole house with multiple rentees, this is nothing to be automated for now. So there is still domain of banks out there, which is not targeted by Hypoport. And as well in our real estate segment here, we target to other market segments. Actually, when you remember what I said about the market structure and changes in 2022 forward in the next 5 years, we expect this small landlord market to shrink because that's less and less attractive to own properties because of the renting regulation. So we expect the home occupier market to increase, to grow relative to this landlord market. So we feel pretty well with the rent regulation. It is in the end, an incentive for German middle class to migrate and get an owner of your apartment. So if you want to get an owner of an apartment, you need a mortgage, and there we have a dominant one here in the German housing market close to every transaction. It's touched by our infrastructure already, and we try to transform this power along the value chain to the sales side, so where we will put a more digital mortgage process directly in front of seller and buyer. And on the other side, on the valuation side. Our touch points here are already significant. 7% of all properties on the market are transacted using our technology, and 9% are using our valuation or part of our variation services. But within both segments, there is a huge chance of going within these markets and achieving higher market share and increasing as well the quality of the services that is rendered by us, the intensity of our infrastructure is used. So in our perspective, a huge potential for additional growth here for Hypoport. But this is not easy to grow, we learned in the last 3 years. We always had a programmatic acquisition strategy. So we bought smaller companies and integrated them, expecting a better kickoff, putting this existing business together with our strength in the value chain. We had to learn that it takes time to transform existing business models and actually realize the synergies that are laying in front of us by combining our business model. The FIO SYSTEM, and so the property said platform is a good example for this. We still struggle to sign up in a fast way the cooperative banking sector while we are already dominating the savings banks. But bringing together sales forces, bundle our offers is, let's say, yes, the speed of collecting contract is still below our expectation, so we have to do better. And let's say part of this goes to the Corona environment as well that it's just not so easy to sell something remotely. What is already developing pretty well is the volume that we see within our platform, so how many homes are transacted using the FIO SYSTEMS, but say there's a huge potential in efficiency gain for our real estate agents or the real estate agents that use our system and as well in the added value and the pricing what we get here. You see, as a result that revenue grew only by 4%, partially because we didn't do any project business anymore, which was still there in the first quarter of last year. So it's a base effect as well. If you exclude this noncontinued business, you can say we are growing double digit in 2021 in this unit here. But still, seeing the power that we have from the mortgage side, we see this huge potential and increase the speed here. And we are working heavily and investing heavily in the synergies between mortgage and [ SCS ] platform. So especially in projects in 2022 as well, expect here a lot of products coming to the market that integrates these 2 worlds. Where we see already more traction is property valuation. A pretty good dynamic on the signing up of new client side and as well a good dynamic on the volume side. Double-digit growth from the perspective of how much share of the market uses our services and what revenue we are generating. Just to be clear here, it means a part of -- let's say somehow we were used during the valuation, but still not everything runs just for Europace and valuating. And here, we see within the addressed market already of this 511 banks, a lot of potential and within each transaction. So how much value we add, how much certainty we give to the bank when evaluating a property, and this has a price and we can increase the quality and added value and what is the price what we had here. And for instance, the One Click mortgage is already based on a fully-automated assessment of Value AG for the property. And this is changing -- it's a game changer for the mortgage industry, and is that a game changer for the valuation industry here in Germany. So now switching to the other side of the housing market, the social housing. As you know, for a long time, we are financing social housing in Germany. We saw again a double-digit growth here, more than EUR 2 billion for the first time in this market. This is -- it's a good result for 2021, especially when you see that building and energy efficiency increase of the household stock were not in, let's say, on the heavy speed here in Germany, thanks to the regulatory environment. It's pretty unattractive right now for the municipal and cooperative housing sector to invest because they can't increase the rents at all. So they wait for subsidies. And while the second half of 2021, there was a short time frame of a good environment. In 2022, we see a lot of promises from the political side that need to be fulfilled to really bring this sector up on speed and heat up the new construction side and the renovation side both. And then you look on the demand side in the housing market, the 2 million units which are missing and then you look on the current development that hundred thousands, if not millions of people from Ukraine are going to live in Germany, you can expect that here needs to be built a lot of infrastructure, a lot of houses. And to finance this, we are already there. And our sales force is out, and we are just waiting for the politics to deliver their promises. So all in all, the segment is growing as it accelerated compared to last year. It's organic growth but based on heavy investments. So we said it in the beginning of 2021, this will be the segment with the heaviest investment. It happened. And I can tell you for 2022 as well, we will keep heavily investing in this segment to ramp up the transformation from the traditional model to the new models based on culture, based on IT infrastructure and based as well on how we're curing the revenue streams in this business models are here. So expect growth here and expect that the growth is accelerating based on this investment that we do. So last segment, insurance. In general, we are here pretty stable in market environment, plus 1% in premium generated overall in the industry, more or less a stable situation for private insurance and as well for pension schemes linked to employer. So all in all, let's say, comps around us. Unfortunately, this leg as well impact to drive digitalization faster. And when I said that Corona environment didn't speed up projects and didn't make it easy to acquire new clients, this accounts especially for this insurance platform environment. We are here with Smart InsurTech for the private insurance and ePension for the employee-linked pension schemes operating in this segment. What is hidden in Smart InsurTech still as well some industry insurances, which we acquired. I will come back to this later. When you just look on the market shares that are already going through our systems, then they are, let's call it, solid in the private insurance market. Insurance as well, even relatively slightly higher while we are in the employer linked scheme -- pension schemes model pretty at the start of the digitalization. How we performed in private insurance and SMART INSUR, plus of 25% on the premium volume migrated to SMART INSUR. This is below expectation. Especially in the last quarter, dynamic was low. So not enough IT projects finished. And let's say we see the trouble clients have and the challenges our organization is facing to drive migration forward. Let's say on this speed, it takes too long to migrate everything, which is in our systems already. And this is -- let's say, this is a concern. So we are permanently looking for ways to change our approach and to accelerate the migration speed. We do this with, let's say, pricing conditions to accelerate and motivate, as which we do it on the technical side with different features. But we still are looking for the silver bullet to heavily increase this process. Parallel, which is as well as important as the migration speed is because migration speed is measured on the sales side, is the validation speed on the side of the insurers. We started with 40% this year and ended up at 23%, far below expectation. So we have a lot of IT projects running with insurers to validate the data that were migrated by the sales side to make sure that all automated processes act on a validated status so that they are actually -- it makes sense. You can't automate an advice process, for instance, if you act on a [ foggy ] status, and so it's core to the benefit of the platform that we reach 100% validation quote so that every information in the platform is validated against the cost system of the insurer. So these delays in this insurance products are really paid for the speed of the digitalization here in the market. And so as I said already on the distribution side as well here, we are constantly trying to optimize our approach and find a way, a silver bullet to drive insurance industry forward. Pretty interesting and pretty new for you. With our acquisitions and historically, the part of the SMART INSUR AG company is an industrial insurance portfolio with the substantial market this year, which were always, you can say some, kind of ballast for their core development in the direction of private clients. And we started to look more detail in this, talk with the clients. We see a potential here as well to create a platform for the industrial insurance realty in Germany. It's a smaller world, as you can see from the total numbers of premium, but it's a world which is looking as well for digitalization and for efficiency gain and a world where we play a significant role already. And so let's see, we invest here some R&D right now and expect during 2022 to make a decision how to go forward here and how to monetize on this asset that we have here. So last, but not least, pension schemes, employer linked. We heavily increased the efficiency between employees, HR and insurance company. When you have these kind of schemes, it's a really troubleshooting issues right now and especially the human resource environment. It's a legal obligation here in Germany for a couple of years to provide this kind of schemes, and every employee can choose from a huge variety in the market, and the employer has to handle this and actually that every employee is advised on this. And with the ePension, we were just 1 out of 2 platforms in the market which offer a digital solution for this complex market. So either you link yourself and your employees to just one insurance company, and your employees never change the employer, all you need a platform like ePension, and we feel pretty well positioned here in the market for further growth. 2021 was not a perfect year, let's say, for this. It was difficult to sign up new companies and especially execute the necessary procedures within these companies because you need to advise employees. And this is still, in this complex environment, something that should be done physically. In parallel, there is -- let's say, the insurance portfolio in this employee pension schemes are indexed, and the index was for the first time in history negative. So it declined by law because it is linked to the overall income of German employees, which dropped in 2021 because of Corona -- or 2020 actually because of corona. In 2021, it increased. So next year, we will have some beautiful profit here. We expect a growth here in this digitalization process of this part of the insurance industry. Yes. All this said, plus 7% -- or plus 10% in gross profit. These are good numbers if you compare this to, let's say, normal market environment, normal companies. We are not happy with the speed that we grow here. We see a huge potential in this market. We see there's still the need for digitization, but we see as well how hard it is to get forward. The only good news in this is all the investments that we do here and driving this project forward because it's so difficult to migrate such a complex environment of IT infrastructure to one core platform. It's the future mood around our business around our business. So it's muddy where we are going for, but it will be muddy as well if anyone tries to enter this market in the near or the further future. So we keep investing here. We want to realize a digital insurance work in Germany, and we are on the way. And nobody else is behind us and not in front of us. Okay. This all said, let's look on the total numbers. Double-digit growth on revenue and gross profit side, even an outperformance of profitability. On the tech side, we had a onetime issue. It will be reversed in the future. So normalize this, please, everything inside. And so fundamental growth is pretty intact. Not just from 2020 to 2021, we are growing now for more than 20 years at double digit. And looking forward, we are keep doing this. To make sure it happens, we heavily invest out of our P&L, you can say, EUR 45 million. We invested in R&D and additional sales resources. And losses in the beginning of developing a new business model out of our P&L, yes. So net to the EUR 77 million EBITDA, there's EUR 45 million in addition, which we just realized the cost already but will pay back in the future. So payback in the future means next year forecast, we expect more than EUR 500 million in revenue, so double-digit growth again, somewhere between EUR 500 million and EUR 540 million in the end. And then EBIT growth to EUR 51 million to EUR 58 million. As I said, the EUR 47.7 million in '21 was above expectation. REM CAPITAL performed better than expected for 2020. We can't expect that this happen again. So for now and looking in the geopolitic environment, there are some uncertainties. We feel pretty safe with EUR 51 million to EUR 58 million in EBIT prognosis. Let's see how ambitious it was at the end. We are focusing on realizing and scaling our business this year. And after the first 2 months, I can say I feel pretty well with this forecast. Okay. Thanks for an hour of listening. Now I hand back to the moderator if there are any questions from your side.

[Operator Instructions] We have no questions. I would like to hand back to you, Mr. Slabke.

Yes, thank you. Okay. Then all questions are answered. That's fine. In 6 weeks, we see again or hear again, hopefully, with the solution and peace in Ukraine again. And I expect with some good results for the first quarter from Hypoport side. So I wish you all health and when you think about Corona and peace for Europe and the rest of the world. Bye-bye.

Ladies and gentlemen, thank you for your attendance. This conference has been concluded. You may disconnect.