Original-Research: UmweltBank AG (von GBC AG): BUY

Original-Research: UmweltBank AG - von GBC AG

Einstufung von GBC AG zu UmweltBank AG

Unternehmen: UmweltBank AG
ISIN: DE0005570808

Anlass der Studie: Research Note
Empfehlung: BUY
Kursziel: 14.65 EUR
Kursziel auf Sicht von: 31.12.2023
Letzte Ratingänderung:
Analyst: Cosmin Filker, Marcel Goldmann

Preliminary figures 2022: Successful closing in 2022 as expected; financial years 2023 and 2024 are to be seen as transformation years; initially significant decline in earnings expected; target price reduced to €14.65; Rating: BUY
 
According to preliminary figures, UmweltBank AG succeeded in continuing its growth course in a generally challenging market environment. The further increase in the balance sheet total by 1.0 % to € 6.00 billion (31.12.21: € 5.93 billion), which was supported on the assets side by an increase in environmental loans issued and on the liabilities side by an increase in customer deposits, is striking.
 
In the preliminary figures, the interest result is not shown separately. However, despite the increase in the loan portfolio, we expect a decline in net interest income. This is due in particular to the continued decline in the interest margin to 0.93 % (previous year: 1.21 %). After the expiry of the Corona special conditions for the origin of funds, the general increase in the interest rate level played an important role in this development. This is because the interest rate increases in the loan portfolio only take place after the fixed-interest periods have expired or in the case of new loans. On the other hand, on the liabilities side, customer deposits have short maturities and thus react more quickly to interest rate increases. The fact that the net interest, financial and valuation result nevertheless increased significantly to € 74.09 million (previous year: € 63.20 million) is probably primarily due to the net proceeds of approximately € 20 million from the successful sale of a wind farm.   
The second revenue stream communicated in the context of the preliminary figures, the commission and trading result, was slightly below the previous year's value at € 9.35 million (previous year: € 9.42 million). The tense stock market situation of the past financial year is particularly visible here.
 
Despite the significant increase in earnings, the pre-tax result of € 39.19 million (previous year: € 38.09 million) is 'only' 2.9 % above the previous year's value. In October 2022, following the sale of the wind farm, UmweltBank's management had forecast EBT of approximately € 40 million, which can be considered largely fulfilled. The disproportionately low development of earnings is, on the one hand, a consequence of the 15.9 % increase in personnel expenses to € 19.88 million (previous year: € 17.15 million). This reflects an increase in the workforce on the one hand and general wage adjustments on the other. In addition, general administrative expenses, plus other expenses, also rose sharply by 40.1% to € 24.36 million (previous year: € 17.39 million). The introduction of the new core banking system (migration process), which is currently being implemented, alone resulted in expenses of around € 3.60 million in the past financial year. The migration process is also accompanied by a higher level of personnel commitment, which also explains part of the higher personnel expenses.
 
Shortly before the publication of the preliminary figures, UmweltBank AG published its forecast for the current financial year 2023 on 10 February 2023. Accordingly, the anagement Board expects a pre-tax result of approximately € 20 million for the current financial year and thus anticipates a significant decline in earnings. The reasons for this are an expected decline in net interest income, which is likely to be influenced by the general rise in interest rates and the deterioration of conditions in refinancing transactions with the Bundesbank. In addition, customers are expected to be cautious in the securities business, which is likely to have a negative impact on the commission and trading result. Finally, declining income will be offset by rising expenses from the introduction of the new core banking system.
 
The resulting decline in income is offset by expected further cost increases. These are related to the planned further investments in personnel, i.e. a continuation of the expansion of the workforce, although less dynamic growth is to be expected here. However, the expenses in connection with the introduction of the core banking system are likely to increase particularly strongly. In the 2022 financial year, these amounted to around € 4 million. An increase to around € 10 million is expected for 2023, before a decline to around € 4 million is anticipated in the coming 2024 financial year. In addition to these costs, the migration process also ties up personnel capacities. With Atruvia's new system, UmweltBank AG will offer its customers an improved customer experience, develop new products and improve internal workflows and processes.  
In this respect, the company is undergoing a transformation process in the financial years 2023 and 2024, at the end of which a modern IT infrastructure will be in place from 2025 and more employees will be employed at the new company headquarters 'UmweltHaus'. Finally, from 2025 onwards, significant improvements in earnings and results are to be achieved, also against the background of the then increasing interest margin.
 
We have taken this development into account in our estimates and made an adjustment to the company guidance for the current financial year 2023. We have also reduced the estimates for 2024 and now take into account a sideways development of the interest margin. Furthermore, we conservatively assume that securities customers will continue to be cautious. We have taken into account a significant improvement in revenue and earnings expected from 2025 onwards in the terminal value of our residual income model. 
 
The sum of the discounted residual income results in a value amounting to € 536.69 million. In view of an outstanding number of shares of 35.66 million, this results in a fair enterprise value per share of € 14.65 (previously: € 16.00). The reduction in the target price is a consequence of the significantly adjusted estimates for the specific estimation period 2023 and 2024. Based on the current share price of € 12.30 per share, we continue to assign a BUY rating.
 

Die vollständige Analyse können Sie hier downloaden: http://www.more-ir.de/d/26471.pdf

Kontakt für Rückfragen
GBC AG
Halderstraße 27
86150 Augsburg
0821 / 241133 0
research@gbc-ag.de
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Offenlegung möglicher Interessenskonflikte nach § 85 WpHG und Art. 20 MAR Beim oben analysierten Unternehmen ist folgender möglicher Interessenkonflikt gegeben: (1,4,5a,6a,7,11); Einen Katalog möglicher Interessenkonflikte finden Sie unter: http://www.gbc-ag.de/de/Offenlegung
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Date (time) completion of the study: 24.02.23 (1:18 pm) Date (time) first publication: 27.02.23 (10:00 am)

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