FinTech Group AG Reports Strong Half-Year Results

FinTech Group AG achieved Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of EUR 13.8 million and revenues of EUR 48.4 million. With those numbers, FinTech Group is fully on track and confirms its guidance of an expected EBITDA at between EUR 30-35 million for the full year of 2016. Many positive developments and partnerships that have been launched in the first half year, will fully contribute to the earnings on a recurring basis from the second half year on: the new “flatex flex-credit” will have a significant positive impact and the exchange traded products issued jointly with Morgan Stanley will further increase profitability going forward. In addition, B2B business continues to be very strong.

FinTech Group’s other key performance indicators (KPIs) have also risen significantly: In comparison to the first half of the previous year, assets under administration increased by 66% to EUR 9.4 billion. The main factor driving this substantial rise in AuA was the addition of a new customer, Equatex, which administers share participation and compensation plans for more than 300,000 employees of German companies. The number of securities transactions executed via the highly-automated systems of the subsidiary Bank biw AG increased by more than 3%, to approximately 5 million as compared to the first half of last year. FinTech Group AG plans to become Germany’s largest executor of securities transactions.

In the first half of 2016, the high-margin “Securities Trading & Financial Services” segment, which includes the online brokers flatex and ViTrade, achieved EBITDA of EUR 7.4 million and revenues of EUR 11.6 million. Since the end of 2015, the number of flatex clients in Germany and Austria again increased by approximately 11,000, to more than 161,000, which equals an annualized rate of about 15%. Newly launched products have been met with strong demand. This is true for both the ETPs issued jointly with Morgan Stanley under the “flatex” brand and launched mid-year as well as the new “flatex flex-credit” launched in April. Moreover, flatex’ European expansion is in full swing.

The “Transaction Processing & White-Label-Banking Services” segment, which includes IT system providers XCOM AG and Bank biw AG, achieved EBITDA of EUR 12.3 million and revenues of EUR 36.5 million in the first half of 2016. Demand for B2B services was strong throughout the year, and further increased as a result of potential “Brexit” as many London-based banks might need operations in continental Europe/Germany. On the back of the excellent market positioning, important new partnerships as the one with Rocket Internet SE, with whom FinTech Group plans to create a digital European bank, have been sealed.

Frank Niehage, CEO of FinTech Group AG: “We were able to further increase profitability significantly, and we still see great potential to improve our margins, leverage synergies, and scale up our business. Our unique combination of strong B2C and strong B2B business means that we are not only well-diversified, but also that the interplay of these two segments will lead to a unique growth cycle since it allows us to develop and profitably market disruptive solutions. In light of this, we continue to expect that our EBITDA in 2016 will be EUR 30-35 million, and we are confident that we can increase our EBITDA once again in 2017.

On Oct. 17, FinTech Group will switch its stock’s listing to registered shares from bearer shares as has been decided at the annual general meeting. The International Securities Identification Number (ISIN) and the German securities number (WKN) will be changed as part of the process: The new ISIN will be DE000FTG1111 and the new German WKN will be FTG111. For 2017, FinTech Group is also aiming for an uplisting to the Prime Standard of Deutsche Börse.

Author: Dylan Jones

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