MLP SE (MLPKF) Earnings Call Transcript & Summary

So welcome to today's roundtable with MLP. I'm pleased to have Reinhard Loose with me today. He is the CFO and will be presenting in a 30-minute presentation what is going on in the background of MLP and also talk about the guidance and the growth until 2028. Organizationally, if you have questions, you are free to ask questions after the presentation. For that, we have Q&A function, which you can use to provide a question via text message, but you can also use the raise your hand button and then we will unmute you and you can ask the question directly to Mr. Loose, if you wish to do so. So I think then without further ado, we're able to go ahead and I hand over to Reinhard for your presentation.

Thank you, Henry. And before starting, perhaps the question again, is there anyone in the call who wants that I continue in English? Or is everyone able to understand German, perhaps a question before. Therefore, is there anyone who speaks -- needs English?

Yes, exactly. If there's anyone in English, just raise your hand. We don't want to exclude anyone. But other than that, I think we can continue in -- there's one that needs English. So we will continue in English.

Okay. Then thank you. Then I'll present around half an hour about some highlights and also some insights, what's going on at MLP at the moment. And then obviously, I'm more than happy to answer your questions. Starting with the highlights. Just to inform you about MLP, we are a network of companies with the idea to support each other and to look for potential in our brokerage community. We are listed in the SDAX. And one of the strengths we see at least in MLP is that due to the business, we have a high share of recurring revenues. And 2 of the key figures who support us in these recurring revenues are the assets under management and the non-life insurance premium volume, the assets under management now are at around EUR 64 billion and the non-life insurance premium volume at the moment is at EUR 785 million. If we now go to the agenda, we'll have a short look into MLP at a glance. Then I'll present you something about AI and what we are doing also with corporate clients. And finally, we'll have a short outlook until the year-end and to the year 2028. Our business model, which is described on the next slide is the financial advisory network, which is based on family and corporate clients. This is something, especially the corporate clients, which we are developing. We came from just the focus on family clients. And over the last years, we are more and more extending our business to corporate clients. One, but not the only reason is that many of the family clients are also incorporated companies, and therefore, we got to corporate clients, but we also acquired additional companies to support us in this business. So this business means the 3 business lines, Wealth, Life & Health and Property & Casualty. And while doing so and looking for additional value inside the group, we also look for using the opportunities not only for digitization and artificial intelligence. Important is we are a consulting company and our target is to stay a consulting company without any doubt. But we are looking for support for our consultants for internal processes, but also for customers with the help of digitization and AI, and I'll bring some examples later. If we go back to the last year, which we finished, the last full year, it's important for us because our business during the course of the year is relatively volatile. We have a very strong first quarter. We had a very strong last quarter, and we have 2 weaker quarters in between. Therefore, it always is interesting to have a look at the full year. That's the reason why we're here presenting once again the full year '24. And there you see that the share of the business now is 50% in the competence fields of Wealth, a little -- 29% in Life & Health and around 20% in Property & Casualty. In Wealth, it's Wealth Management, the interest income we have, but also what we do in the area of real estate brokerage or loan and mortgages. And there you see that during last year, we grew a lot in many of these areas, which, therefore, supported us a lot during last year. In Life & Health and Property & Casualty, we were with a small positive number, more or less stable. And the other field is the real estate development, which we started some years ago and which we more or less stopped 2 years ago. And therefore, the big decrease there in real estate development. And then we have additional -- some additional other commissions and fees, which also support for a very, very small number to the whole cake there. With all these competence fields, we managed on the next page that we exceeded the revenue of EUR 1 billion for the first time. And if you see backwards during the last year -- during the last years, we had a compound annual growth rate of 9% in revenues year-by-year. And obviously, our target is to continue in this direction also for the next year. And as I said, we are very happy that this revenue is supported by many recurring revenues. We have around 68% of recurring revenues. Our target is to have between 60% to 70% of recurring revenues. Recurring revenues, just to remember is what we do not have to need a new contract for the business, the contract is renewed automatically. Obviously, it can happen that the contract is canceled. Therefore, obviously, it's not a safety. But due to the experience of many, many years in the business, we know that the majority of the business, a little bit depending from business field to business field, but the majority of these contracts continue. And therefore, I always make a little bit of the joke that I wake up on the 2nd of January, and I know that more or less 70% of our revenues are more or less safe for the year, obviously, more or less. But I think it helps us to have a first idea what's expecting us in the course of the year. Obviously, the rest, the 30% are important to reach our goals. And therefore, it's necessary also to concentrate on this business. On the next page, there you see the development of the 2 numbers, which I already mentioned on the first page. Two key figures, which we have very focused in our business in our -- where we are focused on the asset under management growing more or less year-on-year. There was 1 year which was shrinking in '22, but overall since 2020, also 9% compound annual growth rate year-on-year. And on the rest -- on the right side, you see the non-life insurance premium volume growing even stronger with 14% compound annual growth rate over the last years and also supporting us there in the area of private customers, but also in the area and the growing area of the industrial broker segment, which we started some years ago in '21 and with the company, [ RVM ], which we acquired at that time. With these numbers, we were happy on the next page to reach EUR 95 million EBIT in '24. This definitely is one positive number. On the right side, we also -- we see our balance sheet as a stable -- very stable and also solid. We are supervised by the banking authority by the BaFin. And therefore, it's important for us to have many of the key figures of the BaFin ask us for, the banking authority. And here, we just mentioned 2 key figures. We have a core capital ratio of 19%, a little more than 90% and a liquidity coverage ratio of more than 1,800, but 100% is needed. This underlines that we have a high liquidity in our balance sheet with our own money, but also with the money of the customers and with the high core capital ratio. We underline that the balance sheet overall is well funded. It's not only, as we see positive and attractive for the banking authorities, but hopefully also for our shareholders. And on the next page, we give you another key figure, which is also important for us, but we think also for our shareholders, which is the dividend and the dividend policy. Our dividend policy now for many years is that we that we are distributing and also planning in the future to distribute between 50% to 70% of the net profits. On the upper left corner, you see the development of the dividend per share growing now for some years now with EUR 0.36 per share, which we distributed in the mid-'25. And on the right corner, you see that with our planning, we expect to reach an earnings per share between 90 cents to 95 cents in '28. And obviously, with the continuation of the dividend policy, you can calculate by your own what would this mean for the dividend. We are covered by 4 companies. You see in the lower right corner, their ideas about our share. We have 3 buys and 1 outperform with a consensus of an average 10 -- more than EUR 10 per share. And therefore, we are hopefully increasing our share in the next future. Then we now go into '25 on the next page, what happened in the first half of '25. We see that we are a little bit below last year. You see the EBIT number of EUR 42.7 million compared to EUR 48.7 million, 12% behind. There are some reasons for this. One major reason is that the performance fees we got last year are much longer -- sorry, much less during the first 6 months. Additionally, we had some additional spending, especially for IT. And both are the main reasons why we are behind last year in the first 6 months. If you go to the revenues, which finally is the most important part to continue also growing the EBIT. And you see that the revenues continue to increase in the wealth area by 2%, I have to say, by only 2%. One reason why it's only 2% is again that the missing performance fees. We had -- just to also give you the numbers in the first 6 months, EUR 2 million altogether performance fees and carries while we had in the same period of '24, EUR 9.2 million. And we all know that the margin of these performance fees are extremely high compared to other revenue parts. In the 2 other business fields, we continued to grow also with a little bit better numbers in the Life & Health sector by 5% and in the area of Property & Casualty, especially there in the health insurance area. Altogether, we increased the revenues by 6%. If we then leave the area of the numbers and go a little bit into the area where we are investing right now, I would like to give you one slide for the AI area where we are investing right now. And of course, many, many other companies also are investing into AI, and we were also, let's say, testing there, but just to underline what gave us the big push there for our AI tools and where we finally installed AI. The reason was that in -- especially in some service areas, we had 1, 2 years ago, problems to hire enough people to bring the level of services we wanted to give to our customers. And this, by the way, is not only a problem for us at the moment, but for many, many other companies. And this perhaps can help us also for the future, and I will continue this in a second. But what is our AI, let's say, strategy. And in the first step, we installed AI where we can just identify the need of the customers. For example, the customer was calling and the customer was -- is speaking to the AI that he needs support for example, in an area of a property insurance claim. And then the AI is routing -- the first step was routing the customer to the people who can handle this. And the second step, and we have this now in place in some areas, the AI is also able to handle some simple questions. That means, for example, if the customer is asking what do I need for additional information to handle this insurance claim. And then the AI gives you the answer. And finally, the third step is that the AI is not only giving some hints, but the AI is able to handle the whole process. And this third step, which you see on the left side continues on the right side. That means -- and this is a valid example. The customer is calling concerning a claim. The AI is identifying the query. The AI is completing the process. That doesn't mean the AI is reading the mail, for example. The AI is reading and analyzing the photos of the damage, which the customer sends together with the mail. The AI is analyzing does this fit to the contract? Does the description and the photos fit to what we normally expect together with the damage? And finally, the AI, if everything is settled in the right manner, the AI is able also to pay to the client. At the moment, we do a stop here because we finally do a check for -- that some of our employees also check finally if everything is done. But they only press the button and then this -- the whole process is managed in seconds or minutes and not in hours, days or even weeks like it took before. Is it perfect in all areas? Obviously, no. But what we see there where the process is now finally programmed and working that, first of all, we have no more waiting times, not in all areas, but in the area where it's finally programmed. We have no more waiting times and -- which is even more important, waiting times in, let's say, a normal business, you can manage this with the normal employers, but you have extremely different peaks in this business, let's stay with the property insurance claims. There are days when we had thunderstorms and not, I don't know, 500 customers are calling, but perhaps 5,000. And obviously, you can't manage this fluctuation just with people. This sounds nice when I describe this and you now can believe it or not. But the interesting thing is, first of all, we have no waiting time there. And secondly, also important is that we spoke about it and some other market participants who have the same problems or than we had before are asking us, it's interesting, can we learn something from you and can we work with you together. And we now are doing this for the first external company. Another insurance company now is managing their claims handling with our process. And we are in talks with other companies who are also interested in this. This obviously is very nice, but I think this underlines that the way we are going there, we believe, is the right one. And therefore, we are eager to continue this way and not only in this area, as I just described with claims handling, but also in other areas. This description is concerning this page. Now I will bring you to other areas where we see additional business. This is the area of corporate clients. I have 2 pages here concerning the expansion into corporate clients. One important market we see there is the corporate benefit market. We are the biggest German broker for occupational pension schemes. We are, therefore, I think, well established in the market. But we also see that next to this corporate pension, there are other areas where it also can be interesting for us, but also for our customer and for additional customers to have a look at, and this is the overall field of corporate benefits. The companies are offering to their employees. Here, you see a lot of examples, public transport tickets or fitness offers, some noncash benefits and so on and so on. The question is how do we manage or how does a company manage all these different offers, which they give to their employees. And here, we founded a small start-up. We call it :pxtra. We have the majority of the shares. And together with :pxtra, we are now continuing in the market with internal clients of MLP and the idea of our network of MLP, but also with external clients. And now after a relative short time, we already have more than 200 corporate clients, more than 10,000 users using this. And this, again, is a company which is very much based on digitalization using AI, but also a digital process, a digital platform. And we are very happy to continue working under this name and with the strength of other parts of the group. And we are just also started another area in the corporate client business. We, as I said, for many years, established in the market of non-life insurance for private customers. We stepped into the market of corporate clients, especially industrial brokerage some years ago with the acquisition of [ RVM ]. But we found out that there is something in between, which is, let's say, too big for our MLP or in many cases, not at all, but in many cases, perhaps a little bit too complicated, too complex for the broad offer of MLP consultants, but a little bit too, let's say, too small and perhaps not less complex enough or the premium is not -- has not a perfect size for the area of the industrial brokerage. Therefore, we started a small company RVM SmartProtect, we call it, where we want to tap this or step into this, in this market of this medium-sized companies and want to offer them with the support of digital platform, also non-life insurance contracts. Here, obviously, we started. Therefore, there are no numbers right now, but we are also quite positive that we can continue on the market here. That's perhaps 2 or 3 examples going a little bit deeper into some areas where we are concentrating or focusing at the moment. And with our, let's say, normal business and with the specialties I just mentioned, we would like to continue our path of growth, which we had during the last years. And therefore, I think, it's time now for the forecast and for the outlook, which you find then on the next pages. We published some years ago, our targets for '25. Our target for '25 is to reach an EBIT between EUR 100 million and EUR 110 million. Last year, we came relatively close. And now we are fighting for reaching this target in '25 with the idea, if you go to the left side, of a more or less stable development in Wealth with a growth in Property & Casualty and growth in Life & Health. Why only stable? Wealth definitely will continue in the next years to be a growth driver for us. But due to the fact that we have a big increase last year in the interest income and as well in the performance fees, we see a decrease in interest income and performance fees. And therefore, it's only a stable revenue here in wealth. If we then look a little bit more into the future into '28, just to remember, we are publishing targets for all 3 years. And therefore, for '28, our target is to reach an EBIT between EUR 140 million to EUR 150 million with revenues between EUR 1.3 billion and EUR 1.4 billion. And where do we see growth potential, more or less, and you all know that in the different fields we are in that depending on the economy, on the surrounding economy, there might be years when one area is going down, therefore, the other is going up. We found out that during the last year, we were able to manage it. The mix nevertheless continue to grow. And this obviously should be and will be our target for the next year. But where do we see potential? We see potential in the corporate client business. I just explained the area of corporate benefits and the small and medium-sized companies, but also for the industrial business area. We see in the Life & Health area also potential, especially with demographic development, the need for advisory services and family clients. And again, the need for corporate benefits here also supporting us in Life & Health and definitely in the Wealth area, the continuation of the development of the last year. There will be definitely other possibilities there, but there are some ups and downs also in the next years. But nevertheless, the overall trend, we believe, will continue and especially in the family client business where we had very nice inflows during the last years, but also with our high net worth individuals, we believe that we can continue the story. And therefore, we see for the year '28, our assets under management between EUR 75 billion to EUR 81 billion. Okay. This is our plan for '28. And therefore, let me summarize this on the last page. We see, in our point of view, a stable business model with a high percentage of recurring revenues, a very solid balance sheet structure, supporting the whole business growth part with a history of many years of growth and also our ambitious planning for the future. We see some general trends which support this growth. And finally, we also hope to convince you with the continuation of an attractive dividend policy. And with this, I would like to finalize my introduction or my presentation, and thank you for listening.

Thank you, Reinhard for your presentation. As a reminder, now the Q&A is open. [Operator Instructions] First question is coming in the audio line, Olaf Hein. Please go ahead. You now -- maybe to speak un-mute yourself, please. Go ahead.

So I don't know how many people are in the chat and eager to raise questions. I certainly have a few and so my first question is it's very wonderful that 70% of recurring revenues are in the back on January 1. But apparently, revenues are not profits, yes. So I'm kind of worried in the market probably as well as this 23% decline of EBIT for the first 6 months. You mentioned Mr. Loose that a major part is due to the performance fees and some other factors I don't really recall. And I'm not so certain. I mean you could probably tell us a little bit more why that should recover. I mean I don't think that the overall market is much higher today or probably at the end of the year than it was at the end of June, at least the MSCI is somewhat flat, I think. And I don't know what you -- how you measure your success or you get the performance fees. And so you have to make up, I don't know, EUR 6 million, EUR 7 million, EUR 8 million for you haven't achieved in the first half, and I'm kind of wondering how you're going to manage that. That would be my first question. And then maybe other people can -- I can have another one later on.

Yes, of course, the guidance I think, is very -- definitely a valid question. As we totally understand just to I wouldn't say correct, but just to repeat the numbers, we definitely are down in the EBIT. We are 12% down in EBIT for the first 6 months, we are EBT, 23%. There was one we underlined this last year, we had an effect in the finance result, a onetime effect, a onetime positive effect in 2024. Therefore, definitely, the net profit is the most important figures, but I think it has the reason why we, let's say, follow the EBT because then this onetime effect in the financial results can be -- is not in the focus -- and therefore, again, it was a onetime effect in 2024 in the EBT and in the financial result. And the EBIT, nevertheless, your question, I think, concerning -- definitely is concerning EBIT. Our target is EBIT and therefore, it is down by 12% by EUR 6 million. I think the question is valid, are we able -- will we be able to recover this. As I said, revenue is not profit, it's not EBIT, but for us, definitely important is revenue is the base for EBIT. And yes, we have some revenue aspects which have a higher margin, like the performance fee, and we have EBIT -- revenue effect which have a lower margin. The missing performance fees definitely is a task for our EBIT, but we also knew and we also planned that the EBIT would be much lower in '25 than in '24. In '24, we had more than EUR 30 million of EBIT, to be precise, almost EUR 34 million, and we planned to have an EBIT in '25 lower to EUR 2 million digit number. We definitely have to reach this, and we haven't reached it right now. Therefore, number one is -- the message #1 is we do not have to reach last year's performance fees to reach our target. But until now, we haven't reached the plan for '24 -- number 2, for '25, sorry. Number 2 perhaps also, we had some higher especially IT costs in the first half year. And obviously, IT cost is something which you can spend or you don't have to spend and our plans for the second half is that they are a little lower. And therefore, this should, let's say, support our target. And therefore, I only can now answer in a different way, you are asking how will we be able to reach this target. We all know that the fourth quarter is the strongest quarter, not only in Wealth Management, but especially in the area of Life & Health, especially in Life. And for us it is important that in the Life area in the last quarter, we manage to get enough revenue and then finally enough profit to reach this target. And therefore, it's like in many, many years, depending on the last quarter. Obviously, as I said, still a challenge, but we still believe it's possible.

Mr. Hein, you can just go ahead and ask your second question.

Okay. Great to have this one-on-one. You are -- your clientele, correct me if I'm wrong, is income-wise above average. I think you have a lot of these academia people from -- you get them from the universities and then the idea is to follow their career path for the next, I don't know, 30 years and then they become more and more affluent, and then you can sell them more higher-margin products, if I understand that correctly. And it's a question that's not very precise, but I'm somewhat in that bracket, maybe in the lower wealth bracket. Whatever, after all, a little time, not very patient and if I be frank, I hate to talk to [ KAI ] or artificial intelligent robots, chatbots and so on. And in my group, I have dozens and dozens of complaints. If you talk to a machine or a robot, everybody is disgusted, to be quite honest, especially if you -- time is money here to speak. I'm a little -- you probably know what I'm driving at, a little bit worried that you're losing your high net worth clientele by putting them in front of the [ KAI ] robot instead of some -- I don't know, real people, although they are in short supply, but maybe you should pay them a little bit better or so. I think it's -- I wonder -- maybe -- it is an open question, how is your experience with a certain physician or so is calling for something and then he has to go through the motion of talking to [ KAI ] and all kinds of these people. Are they happy? Are they -- what's your feedback here?

I think it's a very, very important question. And it's a question which was also in internal discussions for many years. As I said, especially in the area of private customers, but also in the industrial area. Our, let's say, our headline, our mission is we are a consulting company. And our consulting is based on people, full stop. But obviously, there are questions when either the consultants or the clients need some support and where in the past and also nowadays, they are calling a hotline, a helpline for more or less difficult question, perhaps the consultant which the customer has is not available at the moment, perhaps there is a special need whatsoever. And there, we had the problem that like more or less the whole market with a number of customers, we are or we have in our portfolio. We saw that the quality was not what we intended to give. And we believe that the quality with AI, in general, is better than letting people wait on the telephone. And therefore, you see me answering a little cautious because I know that we have some customers who are not happy and we also give them possibilities. For example, if you talk to the AI, you can also say, "Oh, no, I don't want to talk to AI. Please call me back." And then obviously, it might last some hours or perhaps also on the next day until the call back is available. But nevertheless, there is opportunity also to call to real people. But we find out that more and more people are also happy to talk to AI because they have the feeling they come to faster, I wouldn't say better, but at least faster results. Hopefully not better because I believe that our staff who's on the telephone line also can give the right answers. Therefore, the question is waiting time reduction or AI. And we find out that more and more people are -- I wouldn't call it happy, but nevertheless, see it as an advantage to talk to AI and get a fast example -- sorry, a fast answer. The example is that, let's say, in more and more areas also next to financial services. You talk nowadays with AI, you interact with your iPhone with AI, you interact with ChatGPT, Perplexity or whatsoever. That means that people are more and more used to these tools. And therefore, yes, as I said before, it's not perfect, but I believe that is not the only future, but definitely part of the future. But coming back to my first sentence, it's only meant as a support for our consultants. And for the interaction because we, with our business philosophy, believe that what you just said that our customers prefer when it's possible to have a consultant. But there are, as I said, moments and times when it's not possible. Long answer. And I know where you, I know exactly what you -- but yes. And as I said before, the example which I brought is a real example. It's interesting to see that other market -- that to be quite honest, makes us proud that other market participants now asked us what and how are we doing this? And can we use the same system? Or can we use your services that you MLP that you don't cover, support us with the problems we have. I think this...

Yes, that's -- are they named for that -- do you get some royalties or license fees or something?

Yes, we do.

Okay, fair. That's -- yes, that's a valid point. Maybe other entities are even, I must say, in worse shape than you are. So that's a slight weakness. Yes. Okay. Fair enough.

Great. Yes, I think adding to this, I think the insurance industry is one of the least digitized, maybe it's my personal experience. Great. Thanks for your questions.

No I have more -- sure, I mean it's 6:00 p.m. and I wonder, I am sorry if someone...

No, no, it's fine.

Mr. Loose, if you're kind enough to spend another 10 minutes.

And I'll answer a little bit faster, okay?

My question will be more precise, I think. So the entire business unit of wealth management, I'm kind of a wealth manager myself, even a very small one. And of course, I own significant -- for me, stake of MLP shares, or I wouldn't be here. So I know the industry kind of well. And your FERI Trust and I don't know whether some other entities are reaching 65 -- EUR 64 billion. That's a huge number. But in the comparison to the German leading asset manager and not even -- not to think about the worldwide manager, you are, I don't know, worldwide, you're not, I think, you're not even on the horizon. I think that I just looked it up the number of 50 is 10x bigger than you are. And in Germany, you may be at number 20, I don't know. So it's -- and I kind of wonder the following. The fee structure of asset managers is under pressure, I kind of feel. They -- people are -- especially younger generation is not willing to pay management fees to a certain extent. They all have this [ Robinhood ] stuff and everything is for free. The margins are coming down for portfolio management for custodians and so on and so on. And your -- and then there's a fierce competition for assets -- to increase assets overall. There's a lot of M&A going on and takeover and so on and so on. And although looks -- you look pretty solid right now with this EUR 64 billion. It's not a position that is let's say, indefensible or invincible rather, yes. So I wonder what do you have in the future for -- in mind for to position FERI Trust and your additional asset management capabilities in order to compete in the years ahead because it's a fierce battle and it's not going to be any easier in the future, I think.

Definitely, and I think again, very valid and serious question. Our answer at the moment is that we are focusing one time on niches, like we do the so-called Flex family with the Flex funds that we focus on certain customer groups like in our MLP banking on this midsized MLP customers, high net worth individuals and family offices. Yes, there is a fierce battle. We believe that, let's say, consulting has an added value also in the future. And with a mixture of consulting on one side and interest on the other side, we strive for continuous growth there, but we know the market isn't easy.

Maybe any acquisition or like you are a rich company. If you want you can pick up some additional asset as you did in the insurance business, is there -- to find some, I don't know, asset manager that might like to be part of the MLP Group or so is that ever realistic or acquisition kind of growth that's the question.

Acquisition in general, we are I think, it has to fit from the culture and the people has to fit and the, let's say, the overall strategy has to fit. And we find it not so easy in the asset management area to have the right fit there. Obviously, as well some in the market right now who are on this acquisition track. At the moment, obviously, we are -- we have a look at the market, but we're a little hesitating there.

Okay. That's from my side. Thanks a lot.

Thanks, Mr. Hein for your questions. Now we will continue with some other questions. Next in the queue is Mr. [ Klaus Hone. ] Please go ahead. You are now able to speak, please unmute yourself.

I'd be more interested in the IT spending that you've done. Can you give us an indication because it was key in the bad performance, EBIT performance in the second quarter, and everybody is kind of wondering how we should -- what we should pencil in for the third and the fourth quarter. So can you give us an indication of how high IT spending was in the second quarter and how to model it forward for the third and fourth quarter.

Yes, Mr. [ Hone ], now I have to look in my head. We had spending in the area of AI, which were around EUR 1 million higher than we originally planned in the second quarter, and we had spending of around also EUR 1 million in the area of security, cybersecurity, EUR 1 million higher than we expected. We originally planned...

This is all second quarter, right?

That was all -- both was second quarter, and that means this isn't something which you can, let's say, take out for the next quarters. Just to give you a rough number there. Is it okay?

Yes, thank you.

Yes. Was that everything? Or anything?

Yes, that's right for now.

Great. Thanks as well. Next up, Mark Josefson is on the audio line, and then I think we can continue with some questions. Mark, please go ahead.

Many thanks, and thank you for arranging this, Henry. Great roundtable. I want to combine Reinhard, your answer to both of the last 2 questions, actually because I mean I accept the importance of Q4 in terms of seasonality. You have always flagged that. But I see a risk that given also a very strong Q3 2024 again, I think, due to high performance fees in Wealth Management in Q4 last year. I see a risk that EBIT in Q3 2025 could also be below last year's level, meaning that 9 months even further behind the target. And that would mean that we really have to go something in Q4, to get to this EUR 100 million level. Is that a realistic scenario? Or is it the case? I mean, you just outlined EUR 2 million of potential savings in Q3 with the cost savings on IT. But is it -- are there other things that we should be aware of that will perhaps mitigate Q3 compared to last year in terms of the profit performance?

Mark, now -- this is a question concerning Q3, which I'm a little hesitating to answer to detail. But obviously, your general idea is a valid one. We had a very strong performance fee last year in Q3. And I think during the whole year, we said that our performance fees in '25 will be lower than in the year before. And this definitely is valid for Q3. I hope we underlined that the Q3 numbers, especially the performance Q3 numbers will not be reached in a normal scenario.

Right. Okay.

And therefore, let's say, the challenge for the whole year is there and the only possibility we have and we already -- we always said is that we grow in other areas stronger than -- or that we continue to grow in the other areas to level or to give counterweight to the strong performance fees on '24.

Yes, that would be great because I think that helps the equity story, but let's see that. Thank you for answering the question as you could, given the timing of where we are at the moment.

Thanks. Great. Thank you, Mark. I think that sums up your questions, right?

Correct.

Right. Perfect. And we have 2 in the chat there, actually in German, but I will try to instantly translate to English. First one is for Mr. [ Malik Adam ], please explain your strategy in the corporate client business? Do you also expect the buildup of corporate clients consultants that are experienced? And is there the competency of corporate client consultants already there?

Yes, thank you for the question. We -- first of all, we have some -- also some experts amongst the MLP consultants, but especially in the -- with the acquisition of [ RVM ]. In the non-life insurance segment, we also acquired specialists for -- we acquired corporate consultants there. Definitely, we are looking for more. And that means if you have some, please let me know. That definitely is something we are looking for. We -- our target in this corporate client strategy, in the corporate client area is that we have, first of all, want to grow in the non-life insurance segment. We would like to continue to grow in the corporate insurance, the occupational pension area and would like to combine these both areas. Meaning we already are the biggest broker, the biggest German broker, I have to say, for occupational pension, for corporate pension schemes. And that means we have the contact to the customers there. With the acquisition of [ RVM ], we also have a contact with the customers in the non-life insurance segment and would like to combine this, knowing that in bigger companies that there are different people to talk to. But nevertheless, there are opportunities to give an interesting offer combining both worlds. So this is, for us, definitely the biggest area to grow. No, I just see your answer. We are not intending to have our banking business expanded into the corporate client area. This might -- in exceptional cases might be the case. But I think there are so many banks in Germany who do good corporate banking business. That's not our target. Our target is the insurance broker segment, number one. And then the wealth manage area with FERI is number two.

Great. And then 1 more question also from Mr. [ Adam ]. It's regarding tech platforms and [indiscernible] or broker pools in English. In the insurance area, for example, JDC, they are experiencing a strong growth. How do you react as MLP on this development? Do you do -- own software development, white label solutions or takeovers of other brokers in the insurance field? Yes, you gave a little preview already.

Yes, this is a question which you can answer in 1 hour, I'll try to reduce it a little bit. Definitely, we are investing a lot into IT now for many, many years. We are also working together also in the IT segment with other companies. And -- but also, as I just mentioned with the example of DOMCURA, we also start now offering our business to other market participants. That means there is an interesting network in the whole market. And we like to work with many of them together. JDC, obviously, we know them for many, many years. Their model is a little bit different to other model, to our model. But I think we all can learn in one or the other way from each other but we -- our idea is more to grow, let's say, without smaller acquisitions but obviously, from time to time, a midsize -- from our perspective, the midsized acquisition would be easier concerning and then the integration of this company.

Right. I think that answers that. And we have no more questions in the chat or on the audio line. So I think then we can wrap everything up, unless there's one more question coming in, but I don't see that to be the case. Well, in that case, just for me to say a big thank you to everyone who joined us. A big thank you to Reinhard for having stopped his vacation for this hour and given us this presentation and I think I can hand over to you for some closing remarks, and wish the rest of us a happy rest of the day and week.

Henry, thank you for organizing this. Thank you for managing us. And I hope we can answer all the questions, give some new insights and definitely, we're all together looking how the rest of the year will continue and looking forward to this. Thank you. And as you said, now offering or disclosing my little secret, now I continue my vacations and big regards to everyone else.

Great. Thank you. Bye-bye, everybody.

Thank you. Bye-bye.