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Research Tree provides access to ongoing research coverage, media content and regulatory news on DEUTSCHE PFANDBRIEFBANK AG. We currently have 3 research reports from 1 professional analysts.
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DEUTSCHE PFANDBRIEFBANK AG
DEUTSCHE PFANDBRIEFBANK AG
Heta gain pushes Q3 results, special dividend but tax warning for Q4
14 Nov 16
Net profit attributable to shares increased by 128% to €121m for Q3 16 compared to Q3 15. Net interest income was up by 2% to €97m for Q3 16 compared to Q3 15. Loan loss provisions were €3m in Q3 16. Commission income was €2m in Q3 16. Net income from financial investments increased to €123m for Q3 16 compared to €5m for Q3 15 as Q3 16 benefited from net income of €117m from previously-impaired receivables from Heta Asset Resolution AG (Heta). Administrative expenses rose by 2% to €53m in the same period. Pre-tax profit tripled to €159m for Q3 16 compared to Q3 15. The tax ratio was 24% for Q3 16 compared to 0% for Q3 15. The Basel 3 fully phased-in core Tier 1 ratio was 19.1% at end September 2016 versus 18.2% at year-end 2015. pbb raised its pre-tax profit guidance to between €280m and €290m for FY2016 due to the extraordinary Heta gain. Management said it is considering a special dividend after the Heta gain for FY2016. However, it is now also anticipating a higher tax burden for the full year 2016 than in the first three quarters, due to the valuation losses on deferred tax assets from losses carried forward, as well as additional tax payments due following a tax audit. This should translate into a notional group tax rate of around 35%. For 2017, pbb aims for a pre-tax profit between €150m and €170m.
Unremarkable Q2 figures
12 Aug 16
Net profit attributable to shares decreased by 35% to €32m for Q2 16 compared to Q2 15. Net interest income was down by 20% to €93m for Q2 16 compared to Q2 15. Loan loss provisions were zero in Q2 16. Commission income was €1m in Q2 16. Administrative expenses decreased by 2% to €49m in the same period. Pre-tax profit declined by 31% to €42m for Q2 16 compared to Q2 15. The tax ratio rose from 20% for Q2 15 to 24% for Q2 16. The Basel 3 fully phased-in core Tier 1 ratio was 18.4% at end June 2016 versus 18.2% at year-end 2015. pbb confirmed its pre-tax profit guidance, expecting a slight decline for FY2016 compared to FY2015.
02 Jun 16
We have initiated coverage of the German Deutsche Pfandbriefbank AG (pbb) with a price target of €10.05 per share and a REDUCE recommendation. pbb is a mortgage bank with a business focus on commercial real estate and public investment finance. Positive items are: • The property market in Germany is booming. The vdp property price index in Germany has increased every year since 2010 for both residential properties and commercial properties. The index increased by 5.0% for FY2015. • pbb seems to have no problem in fulfilling the future Basel 3 fully-loaded CET1 targets. The Basel 3 fully-loaded CET1 ratio was 18.1% at the end of March 2016. pbb is targeting a higher single-digit RoE and Basel 3 fully-loaded CET1 of above 12.5% mid-term. pbb has obviously some excess capital. However, management does not intend currently to give it back to the shareholders. The payout-ratio target remains at 40% to 50%. Much lower than the new 70% to 80% payout-ratio target of German peer Aareal Bank (see corporate governance item below). The concerns are: • The real estate finance business is cyclical. The predecessor of pbb, HRE, had to be rescued and nationalised by the German state in 2009 during the financial market crisis. The better business part of bankrupt HRE was bundled into pbb by the German state. pbb had to be listed via an IPO on the German stock exchange in July 2015 (EU condition). • The earnings development of pbb has been quite volatile since 2011 due to different one-off effects. pbb benefited from a tax credit in FY2015 and could benefit from a pre-tax gain of €132m in FY2016 due to the write-back of Heta’s debt securities. pbb has benefited from low or no loan loss provisions due to considerable reversals in the last few years. This is likely to change mid-term. • pbb is targeting a higher single-digit RoE mid-term. This target is well below the targets which universal banks promise. But it is much better than what Deutsche Bank or Commerzbank has delivered over the last few years. • pbb has a non-strategic portfolio: the Value Portfolio (VB, volume €18.7bn at the end of 2015). VP contains the old style public finance (HRE) business which should deliver a pre-tax loss of around €10m to €15m p.a. to group profit over next few years. • The IPO of pbb is a paradigm change regarding corporate governance in our view as the targets of a public bank and a commercial bank are quite different. The transformation should be closed with the sale of the remaining 20% stake owned by the German state.
Positive returns from all asset classes in Q316
28 Nov 16
Tetragon Financial Group (TFG) reported fair value earnings of US$49.7m for the third quarter of 2016, with positive contributions made by all asset classes. NAV total return was 1.3% for the quarter and 7.8% for the nine months to 30 September 2016. Having completed a US$100m tender offer in June 2016, TFG commenced a US$50m tender offer on 9 November 2016, which should be meaningfully accretive to NAV per share given the current wide share price discount to NAV. Consistent with previous years, the third interim dividend was held in line with the second interim, confirming TFG’s 5.9% yield.
N+1 Singer - Morning Song 30-11-2016
30 Nov 16
Sanderson has delivered full year results in line with expectations and the 19 October trading update after a strong finish to the year compensated for a slower start. A healthy level of pre-contracted recurring revenue (50%), incremental sales to existing customers and new customer wins at higher average order values helped deliver solid revenue growth in both the Digital Retail (+9%) and Enterprise (+12%) divisions. A decent order book and good sales momentum suggest that the company is on track to deliver on unchanged profit expectations for the current year. We continue to view the valuation (FY17 EV/EBITDA 8.6x) as undemanding given an attractive combination of accelerating growth potential, strong cash generation and growing dividends.
Small Cap Breakfast
28 Nov 16
Warpaint London—Schedule one update. Raising £2.5m at 97p. Expected mkt cap £62.6m vs revenues of £22.3m Walls & Futures REIT — Has raised £1m at £1 to acquire, refurbish or develop residential properties in the UK . Due to arrive on ISDX on 29 November Diversified Oil & Gas— Schedule One now out. $60m to be raised. Expected admission 6 December. Creo Medical Group —UK based medical device company focused on surgical endoscopy, a recent development in minimally invasive surgery. Admission due 7 December. Fundraising details TBA.
17 Nov 16
Topic of the quarter: Following on from our last quarterly we have delved further into the potential and challenges that the Internet of Things present the sector. Having spoken to a wide variety of companies from the sector (large and small, UK and overseas) it is apparent that there is going to be a very significant increase in the amount of data either generated by or available to Support Service companies. The key to generating value from this change will be breaking down the silos in which data is currently held, attracting and investing in the right skills and talent, seeing beyond the short-term investment that is likely to be needed and engaging with clients on a higher, more strategic level. If the sector doesn’t react, then the door is wide open for the Technology sector.
25 Nov 16
Sound Energy (SOU): Completion of fundraise (BUY) Following yesterday’s announcement relating to the fundraise on the Primarybid platform the company has successfully completed the transaction. Analyst: Dougie Youngson Ithaca Energy (IAE): Inspection delay (BUY) During the final stages of commissioning faults were identified in some junction boxes. Consequently start up of production has been delayed until early January whilst the situation is remedied. Analyst: Dougie Youngson Zambeef* (ZAM): Good performance in a challenging year (CORP) Zambeef has reported FY2016 results which we feel are commendable given an extremely difficult twelve months which saw the collapse of the Kwacha, high local inflation, drought, power cuts and the requirement for a large-scale refinancing of the business. In this context double-digit underlying progress in revenue and gross profit is a significant achievement. FY2017 should be a far more 'normal' year and we are not materially changing our FY2017 forecasts or target price. Analyst: Raymond Greaves Gresham House Strategic* (GHS): Attractively priced (CORP) On a 26% discount to NAV of 1,025p yet targeting a 15% annualised return and having made a clear statement on dividend distribution (distributing 50% of net realised profit as a dividend, with 15p indicated from net realised profit YTD for a 2% yield), GHS shares present an attractive investment opportunity. The management objective remains the construction of a concentrated portfolio of mainly quoted smaller companies acquired on compelling multiples, with a three- to five-year holding period and significant engagement envisaged to maximise returns. Analyst: Duncan Hall