flatexDEGIRO AG

Hello and welcome to the Flatex DeGiro Analytics call Q1 2024. Please note this call is being recorded and for the duration of the call, your lines will be on listen only. However, you will have the opportunity to ask questions at the end of the call. This can be done by pressing star 1 on your telephone keypad to register your question. If you require assistance at any point, please press star 0 and you will be connected to an operator. I will now hand you over to your host, Mr. Ashim Shrek. to bring into this conference. Thank you.

Good morning, everyone. My name is Achim Schreck. I'm heading investor relations at FlatEx De Giro, and a warm welcome from our side as well to our analyst call related to the Q1 numbers we published yesterday evening. As usual, we would like to give you a short run through the numbers before we open for questions. I'm very happy that we have the whole management board team here with us today. And for the introductionary remarks, I would very much like to hand over to our CEO, Frank Niehage. Frank, go ahead, please.

Yeah, thanks, Achim. Good morning, everyone. Welcome to the Q1 earnings call of our firm and my last call. Before I start, like always, with the highlights of the quarter and hand over to the CFO thereafter, allow me a few personal words with mixed emotions. With my resignation, I hope to avoid further damage with respect to the reputation of our firm and to resolve the tension with the NIP founder prior to the upcoming annual general meeting. After 10 years of tenure as CEO of our firm, time to say goodbye. First, I would like to thank you, the analyst and shareholders, for your trust, support, and it was a pleasure working with you. And you challenged me, which was very helpful. So please continue to support the firm and the new management like that. I will obviously continue to stay as a key shareholder of the firm, and I will enjoy observing the amazing profitable growth story of this firm in the future and hope to stay in touch with you once in a while. At the School of Life taught us that we always meet twice. Second, I would like to thank all our employees once again. I did that already in an internal mail. But again, thank you all for the great support, achievements, and hard work. And allow me to thank one person especially. It's our chairman, Martin Korbmacher, with whom I started together and who's one of the most professional bankers I've ever worked with. And a great guy, too. Some used to call him in the old days God's gift of investment banking. And without the professional relationship between chairman and CEO, the success story of our firm would not have been possible. If you don't believe me, you can read about that in a study published by the Reinhard Mohn Institute, which I always like to cite, which has investigated the performance of listed companies, highlighting how important the professional relationship between the two roles of chairman and CEO by having influenced the performance of the company, and last but not least, of the stock price. If you don't recall the performance over the last years of our stock price, I'm happy to share with you the number, which equals over 550% until today. And by the way, this outperformed the DAX. during the same period, or if you want to look at it from another perspective, the market cap appreciation of the same period equals 11x. Allow me now a few seconds to take you back into the past. When we were convinced 10 years ago to rescue the distressed FinTech group by another shareholder with the name of Christian Angermeyer, Flatex was a loss-making German focused only niche broker from Kulmbach with 120,000 clients roughly. The founder and the supervisory board member at that time did start a dispute with the key partners and managed the firm into a dead end with 8 million losses in EBITDA. We agreed on a new strategy together of independency from the founder asked him to step down as supervisory board member, relocated the head office from Kulmbach to Frankfurt, agreed on a dilution through capital increases and improving corporate governance. Two major acquisitions, the XCOM-BIW group deal in 2014 and obviously the Giro acquisition in 2019, were inter alia a game changer. I could go on now and now, but with respect to timing, I prefer to look at the situation today. We've created Europe's largest online broker listed in the SDAX, headquartered in Frankfurt. We are heading towards the service of 3 million clients this year, with 1,300 employees out of 30 nationalities, doing business in 16 countries across Europe. We built a true European champion. I am very proud of having served as CEO for so long. The firm is very well managed, very robust, and highly profitable. But is it not strange that now exactly the same founder tries to come back as a supervisory board member through the back door? claiming to know better what's good for the firm? I leave the answer to you all. I trust that the new management will continue to follow the strategy of profitable growth. And allow me one more last request. Please register yourself for the upcoming annual meeting and exercise your voting power. It is like in democracies. If you don't vote, you support minorities. What's most important about the agenda of the upcoming annual general meeting, and everything obviously is important, but let me highlight the share buyback and the new long-term incentive plan for the employees. And last but not least, please support our chairman, Martin Korkmacher, who will guarantee professionalism, good corporate governance, and the sustainable profitable growth strategy. Which brings me back to the purpose of today's call. Let's talk about how profitable the first quarter was now. Here are the highlights. We continued to manage our costs very well. And we did win over 120,000 new clients in the first quarter. And this we did by bringing down the CEC below 100 euro to 95 euros. which was an amazing job of the marketing department. We continued further with the monetization and increased the revenues per trade again. Let's look into the detailed numbers. Our revenues, they went up by 25%. The EBITDA even went up by 177%. And last but not least, the income went up by 341%. That's what I call strong numbers. And last but not least, net cash inflows amounted to 1.8 billion euros. And again, like I always mention in the last couple of calls, without paying interest, proving that we find the right clients who come to us for trading and not for savings. No surprise that we expect the guidance to reach the upper end of the given guidance. And obviously if interest decline in summer and trading activities will pick up, you all know what's going to happen with the guidance. But obviously I leave it now to the new management to decide over that in the future. Finally,