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: 13.80 EUR
Kursziel auf Sicht von: 31.12.2024
Letzte Ratingänderung:
Analyst: Cosmin Filker, Marcel Goldmann

H1 2023: Business further expanded, net interest income reduced in line with expectations; forecast adjusted as project sale does not take place; price target lowered to €13.80 (previously: €14.40); rating: BUY  
Despite the current challenging market environment for the banking industry, UmweltBank AG again increased its business volume, i.e. total assets plus contingent liabilities and other commitments, by 3.1% to € 6,805 million (31.12.22: € 6,602 million) as of 30.06.2023. On the assets side, the increase in outstanding environmental loans to € 3,889 million (31.12.22: € 3,703 million) is likely to have contributed to this development. At € 397 million (previous year: € 325 million), the volume of new loans was 22.2 % higher than in the previous year.  
However, this positive balance sheet development is contrasted by a decline in the earnings and profit figures. The decline in the interest, financial and valuation result to € 25.13 million (previous year: € 29.69 million) is striking. Although UmweltBank AG does not publish any further details on the development of earnings, it can be assumed that a decline in the interest result is responsible for this. The higher interest rate level continues to cause a stronger increase in interest expenses, as these react more flexibly to market changes due to the short-term nature of the deposit business. Furthermore, the expiry of special corona conditions is likely to have caused an additional increase in interest expenses.  UmweltBank’s management had already anticipated a decline in the interest margin.  
The financial years 2023 and 2024 are regarded by UmweltBank AG as a transformation phase. This includes the conversion to a new core banking system, the reinforcement of staff, the construction of a new company headquarters and the fulfilment of regulatory requirements. The migration of the core banking system in particular is associated with high costs, which are estimated at around € 10 million for the current financial year 2023. In the first half of 2023, migration costs amounted to € 4.12 million (previous year: € 0.10 million). This contributed significantly to the increase in administrative expenses to €14.35 million (previous year: €9.37 million).
 
Together with the increase in personnel expenses, the cost-income ratio increased noticeably to 89.6 % (previous year: 59.5 %). Both the decline in income and the increase in expenses ultimately caused the pre-tax result to fall to € 3.11 million (previous year: € 14.01 million) and the result for the period to fall to € 1.49 million (previous year: € 3.11 million).  
Shortly before the publication of the 2023 half-year figures, UmweltBank AG lowered its annual forecast for the current 2023 financial year on 3 August 2013. Up to that point, the bank had expected a pre-tax result of approximately € 20 million, but only with the help of proceeds from the sale of investment projects. However, since the sale of projects planned for the second half of the year has been postponed from the current point of view, a pre-tax result of only about € 1 million is now expected.  
According to the company, the discontinuation of the proceeds from the sale is mainly responsible for the guidance adjustment. However, the ECB's further increase in key interest rates to 4.25 % (as of 27 July 2023) is likely to further burden interest expenses and thus the interest result. Compared to the lending side, the deposit side has a much shorter duration and thus reacts more flexibly to interest rate adjustments. For this reason, the UmweltBank management expects the interest margin to continue to decline in 2023 and does not expect the trend to reverse until the 2025 financial year.
 
Our forecasts are based on the new guidance and anticipate a significant decline in current income (income outside the interest and commission area) to € 3.28 million (previous estimate: € 20.50 million) for the current financial year. In addition, we have taken the renewed ECB interest rate increase as an opportunity to reduce the forecast for net interest income to € 47.17 million (previous estimate: € 49.81 million). Following this logic, we have also adjusted the net interest income estimates for the next two financial years slightly downwards.  
The bottom line is that we expect EBT of € 0.97 million for 2023 (previous estimate: € 20.84 million). We had already taken the significant cost increase into account in the projections as part of our previous research study (see study dated 17 July 2023). As in the first six months, the cost picture of UmweltBank AG will be characterised by rising personnel expenses on the one hand and expenses in connection with the transformation process currently underway on the other. As the majority of the expenses for the migration to the new core banking system will be incurred in the current financial year, operating costs should decrease in the coming financial year. The estimated costs for the system migration in 2023 are around € 10 million. In 2024, these should only amount to around € 4 million. In addition to the expected increase in net interest income, the reduction in expenses should lead to a noticeable increase in earnings from the coming financial year onwards.
 
The sum of the discounted residual income results in a value of € 488.93 million (previously: € 510.49 million). In view of an outstanding number of shares of 35.44 million, this results in a fair enterprise value per share of € 13.80 (previously: € 14.40). The reduction in the fair value is primarily due to the loss of income from the planned sale of the participation and thus to a significant reduction in earnings for the current financial year 2023. On the other hand, we have slightly reduced the interest result for 2024 and 2025. We continue to give the rating BUY.  

Die vollständige Analyse können Sie hier downloaden: http://www.more-ir.de/d/27533.pdf

Kontakt für Rückfragen
GBC AG
Halderstraße 27
86150 Augsburg
0821 / 241133 0
[email protected]
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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: 14.08.23 (3:25 pm) Date (time) first publication: 16.08.23 (10:00 am)

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