Julius Baer Gruppe AG · SIX:BAER
Julius Baer Gruppe — Julius Baer Group — H1 2006 Earnings Presentation
24 slides from Julius Baer Gruppe's earnings presentation, Jul 28, 2006
Slide 1: H1 2006 Results and Outlook
Julius Baer Group H1 2006 Results and Outlook Zurich, 28 July 2006 Program and Content Introduction and H1 06 Results Johannes A. de Gier, Group CEO Asset Management David M. Solo, CEO Asset Management Private Banking Alex W. Widmer, CEO Private Banking Summary Johannes A. de Gier Q&A session in Eng
Slide 2: Highlights First Half 2006
Highlights First Half 2006 Integration Profitability Growth Integration firmly on Cost/income ratio Increase of AuM by track down from 64% to 5% to CHF 320bn Insignificant client and 61% Net new money for H1 staff attrition H1 06 net profit up 06 amounts to CHF Cost and revenue 27% to
Slide 3: Assets under Management by Division
Assets under Management by Division Change from CHFbn 31.12.05 350 320 + 5% 304 300 269 244 + 1% 250 123 122 113 200 110 150 100 182 197 + 8% 134 156 50 0 31.12.041 30.06.051 31.12.05 30.06.06 Asset Management division Private Banking division 1 Pro forma 5 Julius Baer Group Client Base: AuM CHF 320
Slide 4: Consolidated H1 2006 Results
Consolidated H1 2006 Results Net operating income Operating expenses Net profit after tax CHFmn 1394 1394 CHFmn CHFmn 1400 1000 933 450 853 404 1200 1128 400 800 744 350 318 323 1000 300 800 600 250 1392 600 1258 839 200 1126 400 785 731 150 400 200 100 200 50 0 0 0 1 1 1 1 1 1 H1 05 H2 05 H1 06 H1
Slide 5: Group Cost and Revenue Synergies
Group Cost and Revenue Synergies Cost synergies on track, revenue synergies accelerating Cost synergies Revenue synergies CHFmn CHFmn 120 60 55 100 100 50 78 80 40 60 30 40 34 20 14 20 10 4 0 0 H1 06 H1 06 … Target 08 H1 06 H1 06 … Target 08 annualized annualized 9 The Business Profile of New Julius
Slide 6: Program and Content; Asset Management Division AuM
Program and Content Introduction and H1 06 Results Johannes A. de Gier, Group CEO Asset Management David M. Solo, CEO Asset Management Private Banking Alex W. Widmer, CEO Private Banking Summary Johannes A. de Gier Q&A session in English Q&A session in German Appendix 11 Asset Management Division Au
Slide 7: H1 2006 Results Asset Management Division
H1 2006 Results Asset Management Division Strong business performance benefiting from favorable environment P&L Asset Management H1 051 H2 051 H1 06 Change (CHFmn) H1 06/H1 05 Operating income 587 811 760 29% Operating expenses 342 473 401 17% Net profit before taxes 245 338 359 46% Gross margin on
Slide 8: Asset Management Product Type Breakdown
Asset Management Product Type Breakdown Good diversification across both products and regions Breakdown Julius Baer AM Total AuM: CHF 197bn 20% 8% 50% 35% 22% 39% Equity long Bond long Hedge PLF Breakdown GAM 26% 32% 26% 8% 34% GAM JB AM U.S. JB AM Europe Mngd portfolio & Comp. Multi-Manager Hedge L
Slide 9: Update on Asset Management U.S.
Update on Asset Management U.S. Continued growth and accelerating product diversification Overall Business AuM increased by 10% from 2005 year-end to CHF 52 billion, mainly NNM JB U.S. investment business retains distinct, proven approach Integration advanced, with synergies realized in FoHF,
Slide 10: Update on Markets Area
Update on Markets Area Transformed business model producing strong results Overall Business Successful business transformation to focused service provider for JB PB Margin all booked in Private Banking creating strong, effective cooperation Integration with SBC Wealth Management execution unit
Slide 11: Asset Management Summary at H1 2006
Asset Management Summary at H1 2006 Overall Business AuM increased by 8% to CHF 197 billion in first 6 months Positive NNM achieved across the division, reflecting good business developments and favorable market conditions Integration progressing well, delivering synergies and offering more in
Slide 12: Private Banking Division AuM
Private Banking Division AuM Strong NNM contribution from growth initiatives starting to kick in CHFbn 130 +1% 2 -2 125 1 123 122 120 115 110 105 100 31.12.05 Net new money Market Currency effect 30.06.06 performance 23 H1 2006 Results Private Banking Division P&L Private Banking H1 051 H2 051 H1 06
Slide 13: Strategic Achievements in H1 2006
Strategic Achievements in H1 2006 Progress on all fronts Integration Profitability Rebranded Banco di Lugano, Ferrier Lullin Achieved initial results of ongoing and Ehinger & Armand von Ernst enhancement of product platform, e.g. Completed legal merger of Ferrier Lullin - Theme-based product l
Slide 14: Realization of Cost Synergies in Private Banking
Realization of Cost Synergies in Private Banking Realized cost synergies in H1 2006 according to plan CHFmn Cost synergies Cost synergies delivered from: 80 76 - FTE reductions in IT/Operations, staff and 70 product functions 60 - cost-savings due to a single 50 46 Swiss platform, and 40 - the con
Slide 15: Increasing Profitability to Achieve Gross Margin Target
Increasing Profitability to Achieve Gross Margin Target With a multi-tier approach to ensure success bps 102 Trading/execution income already >100 transferred from Markets to PB 100 98 Ongoing strengthening of product platform with higher margin products 96 94 94 Seeing first signs of RMs bein
Slide 16: Update on Other Growth Markets and European Onshore
Update on Other Growth Markets and European Onshore Achievements H1 2006 Strengthened Dubai sales force successfully to a total of 20 RMs Middle East Initiated market scan for regional footprint expansion Established local presence (rep. office) in Moscow Eastern Europe Strengthened marketin
Slide 17: Private Banking Summary at H1 2006
Private Banking Summary at H1 2006 Overall Business Growth initiatives starting to kick in Positive NNM achieved after periods of negative/flat net flows Integration well on track, delivering synergies 2008 Targets Confirmed Net new money inflow of 3-5% Gross revenue margin >100bps Cost/
Slide 18: Summary First Half 2006
Summary First Half 2006 Integration Profitability Growth Integration firmly on Cost/income ratio Increase of AuM by track down from 64% to 5% to CHF 320bn Insignificant client 61% Net new money for and staff attrition H1 06 net profit up H1 06 amounts to CHF 15bn Cost and revenue 27% t
Slide 19: Consolidated H1 2006 Results
H1 2006 Financial Results Presentation In order to provide more useful comparable figures for the new Julius Baer Group, a pro-forma combined income statement was prepared for 2005 This pro-forma combined 2005 income statement has been prepared as if the acquisition of the three private banks an
Slide 20: H1 2006 Results Private Banking Division
H1 2006 Results Private Banking Division P&L Private Banking H1 051,2 H2 05 1,2 H1 061 Change (CHFmn) H1 06/H1 05 Operating income 511 540 585 14% Personnel expenses 207 223 260 26% General expenses 110 103 100 -9% Services to/from other divisions -18 -14 0 -100% Depreciation and write-offs 23 21 13
Slide 21: H1 2006 Results Corporate Center
H1 2006 Results Corporate Center P&L Corporate Center H1 051,2 H2 05 1,2 H1 061 Change (CHFmn) H1 06/H1 05 Operating income 29 43 49 67% Personnel expenses 51 85 59 16% General expenses 25 33 25 0% Services to/from other divisions -21 -20 -10 -52% Depreciation and write-offs 5 4 3 -40% Valuation adj
Slide 22: One-off Integration Costs
Overview One-off Integration Costs Pre-tax profit impact One-off integration costs (CHFmn) 2005 actual1 138 H1 06 actual 19 H2 06 expected 28 2007 expected 23 2008 expected 20 Total 228 1 Excluding CHF 49mn write-down and provisions related to Avaloq 43 Analysis of Group Assets under Management Asse
Slide 23: Breakdown of Group AuM; Key Balance Sheet Figures
Breakdown of Group Assets under Management Asset mix 31.12.05 30.06.06 Equities 41% 41% Bonds 21% 22% Money Market 7% 6% Third Party Funds 8% 8% Client Deposits 4% 4% Other 19% 19% Total 100% 100% Currency mix1 31.12.05 30.06.06 CHF 19% 20% EUR 30% 33% GBP 7% 9% USD 36% 27% JPY 3% 4% Other 5% 7% Tot
Slide 24: Julius Bar
Julius Bar