Hypoport Ag

Ladies and gentlemen, welcome to the webcast results for year 2022 of HyperCore SE. As our customers request, this conference will be recorded. As a reminder, all participants will be in the listen-only mode. After the presentation, there will be no opportunity to ask questions via the telephone lines. I now hand you over to Ronald Slapke, who will lead you through this conference. Please go ahead.

Yeah, welcome from my side as well. We are looking back at a full year 2022, a turbulent one. And as usually, I will go with you for market environment and the numbers of the segments. I will focus today a little bit more on the market environment because I feel the need to explain more what happened actually. and especially what it means for me looking forward in the near time and long-term future. And we are in the core talking about the German housing market. Okay, but you are aware of this, that Hyperport is present in three industries here in Germany. Credit, real estate, and insurance. You're aware of this, that Hyperport is a network of double digit numbers of subsidiaries industry industries, digitalizing them. Um, but with a focus, um, still in there or let's say heavy exposure to the German mortgage market. So, so let's go to the German mortgage market. Uh, what actually happened, uh, with what influenced the year 2022, um, in the way it did. So, um, When you want to understand the German housing market and the German mortgage market, we need to look back more than a decade in the time before 2011, where this market was best described as stable. We had a low number of units finished because of a stable base of inhabitants. Actually, we expected to shrink in Germany from a number of people living here, households as well. Rents were stable, more or less growing with inflation rate. Real estate prices were stable, more or less growing with inflation rate. Mortgage volume was stable, something around 50 billion per quarter, plus minus 5 billion. It was a pretty boring market when I entered this market more than 20 years ago, and it stayed like this until 2011. Actually, what comes from this time is a heavy regulation of new constructions and the renting market. New constructions because we expected to just focus on modernization and maybe already a little bit energy efficiency at this time. We wanted to increase the density of our cities, not really building new. When you see Germany, we never had the intention to in the last 20 years to build a lot of suburbans or something like this, things that you know from the Anglo-Saxon markets. So we wanted to increase the density of our cities. And in the renting market, because of the huge stability, we regulated it heavily to make sure that, let's say, in the end, landlords and renties are fine with a stable situation. So what changed in 2011 was the freedom of movement within the European Union, so an integrated labor market. And because of the lack of labor, of certain level of skills here in Germany, since 2011, Germany sees a net inflow of people, hundreds of thousands every year, migrating to Germany, net, and increasing the number of inhabitants in Germany. So from a more or less stable to shrinking economy, Germany turned to grow. In the first couple of years, we had enough of vacant space in especially the metropolitan areas, which was being occupied. So vacancies were reduced and slowly rents and real estate prices started to Especially the price is faster than the rents for a long period of time. You can say until 2021 because of declining interest rates as well. During this time, the prices in average doubled in Germany, while our mortgage volume in the market just grew from 50 billion or from around 50 billion to around 70 billion. The reason for this underperformance of the mortgage market is that not more equity went into it, but less and less transactions were closed. Especially German households missed this opportunity over a period of a decade. There are studies that show that more than a million people that you would have expected to buy when you see who bought before 2011 didn't buy after 2011. So we had that declining home ownership ratio in Germany during a period of low interest rates because Germans didn't trust in this price increases which they saw in this decade. And yes, since 2015, institutions like Bundesbank warned that prices are inflated and kept families from switching from the renting market to the home ownership market. today's perspective a huge disaster for our society okay so um just to to understand um the german mortgage market was not in the booming state until 2021 it was just a slow grow thanks to the huge demand for housing here in germany so Now we are reaching the year 2022 and with this, from the beginning of the year, a high level of an increasing level of inflation. As the market expected, ECB picked their quantitative easing policy. They stopped buying government bonds and later started to increase the short-term interest rates. So the market reacted with a sharp increase in long-term interest rates. You can say from a mortgage perspective, we rose from roughly 1% below interest rate for a 10-year mortgage to close to 4% in the late summer of last year. So 300 basis points up. in interest rates this leaded in the beginning of the year to a spike in mortgage volume in the first quarter we closed more than 80 billion in mortgages a new record high for Germany because lots of people closed existing financing projects for building homes buying homes or refinanced mortgages which were due in the next couple of months or years In the second quarter, we saw a normalization of this volume. For us, surprising, or for everyone, surprising, you could say, after the summer, people didn't come back and the mortgage volume, let's say the first transaction volume, but with this, the mortgage volume in the market tanked to a level unseen before. Today, it's easy to explain why this happened. Because it never happened before, we were all surprised. The core reason is that, let's say, we need to start there, that Germans acquire a home or plan to build a home because of a trigger event. I will come back to this later. These trigger events just occur and normally takes a couple of weeks months for a german family after a trigger event to close a deal for a home ownership during the year 2022 we saw in the beginning because of the sharp rise of interest rate that people were had difficulties to adjust the reality to their dream and everyone starts in this process with an unfathomable, not financially dream of a home. But because of the sharp rise of interest rates in the first half of the year, people couldn't catch up fast enough with their rising costs and couldn't dilute their dreams as fast as they should have done this. And in the second half of the year, people saw that real estate prices were trickling down, something you could read all the time in the newspapers. So the hope of better deals, of being able to afford your dream state and interest rate more or less stayed stable on a certain level since summer last year. In the last eight months, you can say the 10-year interest rate is pretty in the same range all the time. in the second half of the year waited for the opportunity to buy something cheaper and we saw declining prices by roughly 15% over the time on average. So the hope to be able to acquire something which is close to your dream just stayed. And with this we ended the year 2022 and we communicated this already that Especially in the last quarter, we saw that we reached a new baseline, you can say, a low level, but a stable level. And we looked on the three months at the end of the year. So for now, in this environment, Hypoport performed. let's look at the details of the, let's say, three product areas of the mortgage market, how they developed, to still understand it slightly better, and then I will come to the results, what performed in this environment. So the sharpest decline during 2022 we saw in new constructions. You can say that at the end of the year, roughly only one-fourth of the volume was left compared to previous year. So the building imploded because of high construction prices on one side and this sharp increase in the cost of the interest rate side. And no hope of declining prices short term, to be fair. So nobody, let's say not nobody, but only 25% roughly of the people still finance something to build something in the near-term future. This is no surprise in the end. The highest impact had a decline in purchase, so existing homes to be acquired by someone looking for a new apartment, roughly 50% down from the peak, 30%, 40% down from the previous year. Here you see this mismatch. between what I'm able to afford and what is the current price level. This is just slowly declining prices of properties. It doesn't match still. It would have to decline roughly one third to meet the affordability the people had a year ago. A little bit surprising for us, the decline in refinancing. At the beginning of the year, we saw a peak outside of the typical renewing volume because people really used this short-term interest rates which were sharp going up to refinance already their future mortgages more than they usually do. But it stayed on a pretty low level to the end of the year. Slowly, we see that people are waiting pretty long before they really refinance something, so they postpone this decision as long as possible, hoping that the interest rates still come down. As well, a little bit surprising, modernization, so energy efficiency decarbonization is on a pretty low level in the second half of 2022, even when there is more and more political pressure to do this, and even when there are some incentives. and subsidies to do it. But people hesitate to invest in their properties, something which is not in line with the general agenda that we see right now. So this is the development in this, let's say, four segments of the market, four core segments of the market. And now we get to the area of how Hypoport and the segments performed We start as usual with the credit platform. In the center, Europace with its mortgage business, but as well, there's a personal loan business on Europace. And beside Europace, there's a funding portal and capital in the segment with the business in corporate loans. In the mortgage business, Europace lost 8% of its transaction volume. We were close to 100 billion a year ago and it was 90 billion of mortgages and the building society saving products last year. This looks like that we just went with the market because market was down roughly 9% as well. Be aware that the market reference of Bundesbank is delayed numbers, delayed figures. They need to be already in the balance sheets of the banks. So they saw this decline a couple of months after we saw the decline in the transaction volume already. So while we saw a stabilization at the end of the year, Bundesbank is still going down, especially when you see the January numbers. So with this in mind, we are absolute certain that we gained market share last year double digit and one reference point which we have is Interhub as the largest German mortgage broker who reported its numbers and was down 15% last year based on volume and this 15% is in our perspective still a market share gain because Interhub usually as we gained market share. So we expect the market in reality to be down roughly 20% compared to inter-hybrid hour numbers. Okay, this side, even in this special environment, we see a market share gain and we see this in all four segments of the market. Pretty visible in the cooperative banking area, plus of 3% in the volume still. So We don't know how much the cooperative banking sector lost in market share or in volume last year, but we can expect an outperformance of minimum 25% of this number. A little bit more difficult with the savings banks, minus 7%. What we see and feel in the market is that they lost market share in 2022. So they underperformed the market. And when the market had minus 20%, they may have ended up with minus 25 minus 30 percent. So in relative we gained market shares in this group and about this we are certain. Private banks were pretty stable from the market share last year. We were slightly growing. So everything in line. Brokers in the first half of a year lost some market share because in the time of lots of volume Banks prioritized in their credit decision process their own branches and mortgage brokers lost some market share. In the second half of the year, in this tough market environment, branch networks of banks heavily underperformed the mortgage brokers. So even if the mortgage brokers lost significant in volume, bank branches lost much more. We see this on the Europace platform as well. There's a difference of roughly 20% in performance between bank branches and brokers using Europace. And this is just an indication how heavily traditional operated bank branches were hit, which are not even users of Europace. So from a Europace perspective, the good news is that Our stronghold, the mortgage brokers, in this new and market environment of higher interest rates and consumers who need to compare a lot and find the best deal are growing and expanding their market share because with this, there's a natural way for your place to grow. Beside the fact that your place will keep gaining market share in cooperative and savings banks as well. Next product area, personal loan business plus 29% in a more or less stable market environment. Our focus on B2B and wide label personal loan business for banks and advisors is paying back. It's more and more needed to have a risk ventile and a price ventile when you're operating in this competitive market environment where consumers tend to compare as well, find the best deal online. And if you want to be competitive in this, you need and you have a traditional way to access consumers, you need your place as well. Nice development last year is the rollout of Genoflex in the cooperative banking sector. Besides the private banks, now the next group is adapting to a more open approach for their client base. With the successful initial launch last year, we expect a further growth here in 2023. The last product area in the credit platform is corporate loans. financial advising, especially regarding subsidies here in Germany. Still under the old government, we saw great subsidy programs for German Mittelstand, especially climate-related and energy efficiency-related. This led to a lot of business for REMP Capital in the second half of 2021. and first half of 2022. The new government is now in place for almost 15 months. Still, there are no new subsidy programs. Everything what they brought up in this first year of their being responsible for this area is still, let's say, small budget. We expect over the period of until the next voting on the federal levels you in now three and a half year that they need to live up to the expectations and the ministry for business is run by the Green Party. So we expect here sharp change in the next three years. But for now and for the second half of 2022, the attractiveness of government-sponsored program was low. And so was the new project volume of REM capital. It's not an unusual level for REM capital, but we are for now pretty far away from the extremely high and attractive environment which we saw a year ago. So in total for the credit platform, it may look like a stable year. So after record first half year, we lost in a year-to-year comparison in the second half of the year significant in volume because of the market environment, especially in the mortgage market, but as well because of the special situation in the small and medium enterprise financing world. So you could say it was a tough year looking back. We had to adjust our... We had to cut down on our workforce in the credit platform as well. But already mentioned here, we kept all innovative projects alive going forward. So especially around the mortgage world with our heavy investment in the consumer facing technology, automated advice processes and automated credit decision processes. We keep investing there because we see this as a core driver for future market share gains and margin expansion in the year-passed world. Next segment, close to this, private client. As you know, the mortgage, the Dr. Klein Fletcher system is in the core in a mortgage brokerage business as well. Dr. Klein lost... seven percent um in this market environment so gate market share as well um outperformed into hype the closest comparable closest competitor um by eight percent which is great um so the um a great performance of dr klein in this diet competition um and especially in the second half of the year with this tough market environment we see that um our decentralized structures of entrepreneurs in the local communities performs better than what bank branches can do in this business. So out of this crisis mortgage brokers will leave as winners in every local business. Plus the online world is already heavily dominated by them and consumers which are more attracted to information right now consider for a much longer time what they are going to do are more often in touch with mortgage brokers than they were before this crisis environment unfortunately for the first time over decades lost a number of advisors our franchisees are smart as well they see that they have less leads to advise on so they reduce their workforce They keep the better converting advisors, but especially advisors with a weak performance had to leave the franchise system. And so we lost 40 of them. It's a pity because it was hard to build it up. On the other side, this resizing is necessary in the current market environment. And I'm sure we will be able to regain this as soon as the number of leads is going up again at our franchises. will react fast at this moment as well. From a financial perspective, it was not a record year for Dr. Klein, as well for the first times for a long period, but still Dr. Klein performed all in all pretty well in this situation. Stayed pretty profitable over the whole year even at the end of the year and the most toughest situation of the market which we saw by now was profit and cash flow positive and made a good business. Okay, next segment real estate. You're aware of this that we split the market in three groups. We have a home ownership market which is shrinking, as I said, but still something around 20 million units, 40 to 45% market share here in Germany, which is our core focus with the whole Europe-based mortgage business, Dr. Klein business, but as well here with fire and value. Beside this is the renting market, and you can say there are two types of renting market, the housing companies, typically municipal owned or cooperative owned. So social housing with roughly 6 million units. Another target group that we serve under the band Dr. Klein Bovee. They are, you can say stable. They are, let's say, I will talk about this in a moment when we talk about the financing platform. And in between you have a group of smaller landlords, typically private, which bought renting apartments for their pension or do this a little bit more professional. This is an area of business with 60 million units, which we are not really addressing. And from today's perspective, I'm pretty happy about this because this is a market which is under pressure because of regulation. And looking forward, I expect this market to shrink in favor of the homeownership market. But let's say first 2022, how we performed. Let's look first on the homeownership market, where we use our strong position in the mortgage market with slowly every third mortgage going through Europace here in the market. To use this strength to expand to valuation worked as well in 2022. we increased our market share and valuation to roughly 11%. So in the value chain to go behind you is easy. In the other direction, in front of you, it's more difficult that we lost market share there. The reason here is that our core target group, the real estate agents of banks lost heavily market share because let's put it mildly, when you need to sell a home, Really, when selling homes is your core competence, you can't just sit in the branch of a bank. You need to be more active. Up until the beginning of the year, homes sold themselves. You just had to manage the process. But since the second quarter, you really need to sell something. And selling is not a stronghold of real estate agents of banks. And second, even with our support, they are still far behind in digitalization and online presence. And people are much more intensively searching and looking around. And other agent groups are more effective with this. And we see as well a growing C2C market here in Germany, which the banks still don't address properly. So how does the different units perform in this in detail? So FIU on the transaction side and the real estate broker side grew. So we could add additional clients, especially in the cooperative banking sector, where FIU has still a huge growth potential. But at the same moment, because of mergers between savings banks or between cooperative banks, the gross number declined. In total, their transaction volume declined by 28%. More than market. Market was down. No figures out right now, but our expectation 15 to 20%. And they lost 28. We could gain revenue because of additional services on the platform and the very successful FIRO business in the managing system for the renting market so ERP system for homeowners grew from a small basis but it's getting slowly significant here in this number so let's say struggling environment struggling clients but we were growing but have to invest substantial in this business to gain traction here Talking about gaining traction, Value AG with a strong link to our other mortgage businesses could gain additional clients. So more and more banks use more and more services of Value AG. And the number of valuations went up, so the number of involvements in the value chain of Value AG increased, which is great. And we could increase our revenue. with this but as a let's say the availability was in 2022 not affected by the turbulent market environment most of the time we had difficulties to scale our business with the amount of new clients that we were onboarding and deliver the execution resources for this and were hit heavily when BaFin in the second quarter a prohibited online inspections because of a rollback of all corona linked easinesses for the banks. This surprised us. The necessary adjustment in our resources to be able to offline again do the valuation inspections costed us a lot of money and a lot of traction. In the third quarter alone, it was 3 million, and in the fourth quarter was another substantial amount added to this. And BaFin did this all just to roll back to, yeah, now this video inspection is allowed again at the end of the year, but they put this in... troubling issue that the LTV is then lower when you inspect the property remotely. So still it's not that the digitalization efficiency is coming back fast. So with this very volatile regulatory environment, Value AG lost a substantial amount of money even without this turbulent market around. This was a very intensive year for ValueIG and fully unnecessary in this moment. Third product area, housing associations. I said already it's a stable environment. Especially from the number of units, you can say they don't change the number of apartments they own and manage. Recently, they started to build. You can say in 2022 this stopped. So then the number of new social houses financed dropped sharply here in Germany because of the interest rate rise in combination with too high regulation of building and renting housing. So the whole real estate industry and especially the housing associations are in some kind of strike. They don't finance anymore. They don't plan to build anything until the regulatory environment is changed. We could, in this really tough environment, outperform the markets or take heavily market share. We found the things that had to be financed, especially in the area of modernization, some acquired properties when when the price was okay. And we could even increase in this environment our mortgage volume on the financing platform for housing associations by 2%, and our revenue out of this by 25%. So very successful year for this unit. It will be challenging in 2023 if the regulatory environment is not changing. Overall, for the segment, a year of growth, plus 12%, which is fine, but with heavy investments. Especially value AEG costed us too much money in 2022, and this HCAG regulation was painful. The whole segment is not fully affected by the market environment, but we focused especially in this area our approach to reduce costs and find a new balance between investments and future growth. The last segment, insurance. We ended insurance already seven years ago with the goal to be a little bit less dependent on the lending market and especially the mortgage market. Unfortunately, still we couldn't grow to a size where the stability of the insurance industry gives stability to Hypeboard in general. But now in the current environment, in this personal loan business and the personal mortgage business, especially we can say that thanks that the insurance industry is just a stable market environment, small incremental growth in premiums and not affected by recessions, inflation or other core macroeconomic events that we see right now. We have three areas of digitalization, product areas where we digitalize. The personal insurance part, the smart intro tech. employer-linked pension market with ePension and the industrial insurance market with Corrify. All three are relevant markets here in Germany. In all three, we have small market shares for now with a different growth speed, you can say. In the private insurance area with Smart InsurTech, we are still in the process of migrating existing clients which we acquired with existing on-premise solutions to a centralized platform. 10% of migration in the last year, additional migration of volume in the last year is below expectation. We had heavy investments in the last five years in this area to speed up this process of migration. We were not successful to speed this up. And because of the need to readjust our investment strategy for the group in general, we reduced our investment and we don't try the additional investments anymore to speed this process up. And we don't expect it to slow down, to be honest, for the upcoming years. The validation rate increased to 30%. So our links, our interfaces with the insurer increased their relevance for the volume. So for the first time, you can say more than a billion euro in the platform is synced automatically with the information in the databases of the insurance companies. So for every additional service, this is relevant that we have this quality of information of data in the joint platform. But still, it's a long way to go to finish the migration and finish the integration with the insurance companies here. Yeah, it will stay a growth path I'm sure about this, just we will not invest so heavily anymore in this area. And it's part of our saving program that we executed end of last year. Completely different story. The industrial insurance market where with an acquisition, we gained as well traction on the client base, managing their existing insurance portfolios. and together with them in the last year identified the need for a platform for auctioning new insurance risks in industries and got a pretty good feedback for this idea of our existing client and as well potential new clients for the platform. We are in the developing process for the platform and in summer this year we expect to go live with a better and change the way how industrial insurances are underwritten here in Germany. It's a pretty cool thing. And we expect here a potential, very valuable business to be identified next to this pretty slow-moving private insurance business. Yeah, the last one. As well, faster developing than expected to be fair, our employer-linked pension digitalization platform, where there's a huge level of complexity between these four parties involved, where a lot of data needs to be exchanged, a lot of complexity is there, and especially employers to fulfill their obligations and needs of technology, and we are Here in a good position in the market, just two grown-up companies are competing to digitalize this market. It has, as you can see, a huge potential in front of us. In total, insurance business was growing last year. The 26% looks better than it actually was. There was an acquisition of Amex Pool, which for the first time recognized in our numbers. Organic, we grew by 6%, still outperforming the increase or the growth of the industry substantially. But well, the dynamic was below our expectation. And so we reduced our effort in investments going forward in 2023. So 2022 will be the last year where we lost money in this segment. I expect the growth speed to sustain in this area of high one-digit and maybe we reach even double-digit thanks to the industrial area. These were the four segments. When we look at the total group level and the total year, you can say loss of probability thanks to this sharp change in market environment and that we were pretty surprised by the intensity of the drop in our core market. When you look on just the fourth quarter, you see that the current market environment is costing us revenue and profitability, but with the necessary adjustment that we did at the end of last year, we feel pretty comfortable going forward, even if the market environment would stay tough for a longer period. On a long-term view, you can say in 2022 Hypoport entered a new phase after seven years of strong growth from 2014 to 2021. We are now in some kind of a quality growth, we call it, where in the tough market environment, we will take market share to grow. And as soon as we see a normalization of our, especially core market, we expect a fast increase in profitability. And it will not take seven years from now. How long it will take, we talk about in the next area. But before we look at the market, Just a reminder, we communicated this already. In the fourth quarter, we reduced our workforce and restructured a lot of areas as well in our other costs. We had a net one-off effect of minus four million to execute this all end of last year. But with this, our cost base compared to the third quarter was reduced by roughly 10 million per quarter. So for 2023, we expect 35 to 40 million less cost than we would have had if we would have continued with the cost of Q3. It's a pity that we lost so many talents on the way. But as you know, we were in a heavy investment situation in the beginning of the year. and had a lot of ideas and projects where we looked for new opportunities. We stayed with all the projects which are already visitable to clients and where we see traction. So especially around the mortgage business world or qualify in the insurance industry, or Gino Flex with the cooperative banking sector and personal loans. There we keep investing because we see the near-term chance and see this as very, very well invested money even right now in the current circumstances. And for us, it's enough that we are cash flow positive even in the circumstances. We don't need to generate exceeding profitability right now by shutting down more innovative projects. So we keep the balance between where we are still putting our money, even in these tough situations, and where we see the chance in this market environment as well. Yeah, short about our capital increase. We raised 50 million. especially as a signal to everyone in our core industries that HyperPort is their HyperPort. It's a strong, reliable partner in every market environment. So calculate with us. Solve your problems with us. We are part of the solution. We are not weak. Don't try to get a bargain with us right now. Try to get a solution for your problem with us. This is where you need to look at. Okay, so looking at our car market and the question of how it is going to perform in near time, you need to understand how the German mortgage market works, how German households actually decide to make an investment and acquire their first home and leaving the renting market and entering the home ownership market. Core trigger events are children's, especially to build something new. You do this because you expect children's or they just arrived. To purchase your first home, it's typically as well triggered by children's, sometimes as well because you fell in love and you want to move together, sometimes because you divorced and you need an additional home, and sometimes because you changed the area of your living um you move to a different metropolitan area and you were used to live in your own home and you wanted to keep this so these are the reasons why you buy in germany you don't upgrade because interest rates are low or you can afford more germans buy once and they leave their home with their feet first and this is very important to understand this because the not the interest rate change is the core reason right now why the market is down the core reason why the market is down right now is that the trigger events are there but people need to adjust their dreams to the reality and the reality is right now mortgage rates of roughly 3.5 to 4 percent and it trickling down property prices and this is This trickling down to property prices gives you an incentive to wait. As long as they trickle down, people still have to hope that they can afford more than they could right now. The adjustment of the dream with which you entered this decision process is slowed down. From our perspective, let's say the current price drop is 15%. from a peak in May last year on average. To be fair, especially energy-efficient homes dropped much less, more or less close to zero, while energy-inefficient dropped sharper. But on average, we saw a drop of 15%. And depending on what you are looking for, this is relevant for you. For the total market, it's 15%. If you would like a total adjustment to the interest rate increase which occurred in the beginning of 2022, you would need the price drop of roughly 30% to 35%. Over time, because of increasing incomes, the affordability gap closes from both sides. So we are at minus 15% on the top line of the price, and we are with the income 5% to 10% up. And let's say it's a race, the first one to buy or is able to buy a property, it's going to close the deal. So it's not the average of income. It's what the target group and these are, let's say, we are not talking about social housing here. We are talking about people who are able to afford a home, the upper third of the German income level. So the ones who's developing its income the fastest are catches the properties first. So the gap is slowly closing. We see this as well in the dynamic and the price changes. We started slow in May. In the summer, 1% per month decline in property prices. At the end of the year, we reached roughly 2% per month. And now we are already down to 1% decline only. So the decline is slowing down and we expect in the next couple of months already that we are getting to a stable price environment. And just a shot after this, we will see increasing prices here again. Core reason is net migration is high, demand is high. The renting market is fully frozen. Sharp increases in rents, you could say plus 10% easily right now on a yearly basis. City of Munich just reported a 21% increase compared to two years ago. And for Berlin, the second largest portal here reported last week an increase of 27% on the quarterly basis. So the rating market is really fully frozen now. And so if you have an increasing income, you have a trigger event, you just need to buy to solve this and you need to just adjust your dream to this, what you are really able to afford. And we see this dynamics ongoing as i said expect for the next couple of months already a turning point from there we expect that thanks to the frozen renting market we will see transaction numbers higher than before 2022 in the beginning with still lower volumes per transaction because of the lower prices So from this 250 billion to 200 billion market we had in 2021, when we leave this current situation, we will come to a roughly 250 plus billion market for the same type of acquisition of properties and building properties. What comes on top of this is... the decarbonization investments that are needed. So for Germany right now, the laws are implemented to upgrade your heating starting effective 1st of January 2024, which will lead to additional investments within the next 10 years of roughly 1,000 billion euro. And plus from on EU level right now, A new directive is in final negotiation where all homes with an energy efficiency level below D needs to be upgraded until 2032, so in the next 10 years, which leads to additional investments of 1,500 billion Euro here in Germany. So parts of this investments are renting markets or more or less a good half of it. But for the home ownership market, we expect investment needs in average for the next 10 years, just based off the current regulation and the current environment of 80 billion in addition. So this adds up to a total market of something around 350 billion in the near time future. from a market volume where we are right now in January on Bundesbank reported 13 billion. So 150 billion if you analyze it. So more than doubling of the market volume we expect for the upcoming years. The question is just how fast it's going to get there and not if. And with this in mind, put our guidance into perspective. So for this year, it's really difficult to predict how fast this transformation of the market will go forward with let's say a slow speed and a slow normalization we expect still in comparison to last year a decline on a full year basis we are pretty sure that our first half of this year is better than the second half of last year but this first half of last year was really at record level if If the second half of this year we get close enough, we don't know. So we expect a decline in revenue in total from up to 10% and a decline in our profitability of up to 30% for a total year. It's just a certain level of normalization. From an investor perspective, from my perspective, much more important is our long-term view. From here, there's double-digit growth then. And I just described it. We are talking about a $250 billion market, up to $400 billion market from a $150 where we are right now. So there's a huge growth potential. And our incremental margin in most of our business model is 100%. So the question is, will 2024 or 2025 be a new record year for HyperPort? Not if there's coming a new record year for HyperPort. And our last record year was 2021. one and this is not long ago and we have a track record of double digits growth for 20 years and we will keep getting back on this track as soon as we see a normalization in our core market okay this said i'm happy to answer additional questions if i didn't answer everything which was out there already thank you

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Yeah, thank you. No problem if all questions are answered. If you have some more, contact our IR. Actually, what I did mention is we saw a stabilization already in the last few months of the last year. January, February was in line with this perspective. We saw the button. From here, we see incremental movements up. With this in mind, in two months, we will update you on the development of the first quarter here, how fast the environment is developing, how we are performing in this. I'm pretty sure that from here, there's only one direction. Happy to keep you updated there. Thanks for your time. see you here in the beginning of May.

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