Bellevue Group's net profit increased 17% to CHF 11.5 mn in the first half Freitag, 27. Juli 2018 - 07:00

Bellevue Group AG / Key word(s): Half Year Results
Bellevue Group's net profit increased 17% to CHF 11.5 mn in the first half

27.07.2018 / 07:00

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Media Release

Küsnacht, July 27, 2018

Bellevue Group's net profit increased 17% to CHF 11.5 mn in the first half -
record-high assets under management present a compelling platform for
further growth

  * Group operating profit increased 15% to CHF 13.5 mn

  * Net inflow of CHF 552 mn in new money from institutional and private
    clients

  * AuM increased 6% to a new record high of CHF 12.7 bn

  * Asset Management grows its operating profit to CHF 19.5 mn

  * Net loss at Bank am Bellevue, as expected due to start-up investment in
    Wealth Management

  * About 70% of the Group's equity strategies beat their benchmarks

Bellevue Group continued to sharpen its profile as an asset and wealth
manager during the first six months of the current year. Its solid business
results for the first half of 2018 reflect national and international
recognition of its innovative active management expertise. André Rüegg, the
CEO of Bellevue Group, remarks: "Growing assets under management combined
with our outstanding performance track record create attractive growth
prospects for our entire Group. We intend to build more momentum in Asset
Management using our broad product offering and through selective
innovations. After the successful start of the Wealth Management unit, we
now want to accelerate its business activities and thereby further diversify
the Group's income base."

Group assets under management at new high, driven by organic and inorganic
growth

Bellevue Group's appeal as an internationally active asset management
boutique with innovative asset and wealth management services is clearly
growing. During the first half of the year Bellevue Group acquired new money
of CHF 552 mn. This corresponds to an annualized new money growth rate of
about 9% - which is at the upper end of the targeted range of 5-10%. New
money in the Asset Management unit amounted to CHF 438 mn and Wealth
Management was entrusted with new money of CHF 114 mn from entrepreneurial
private clients. StarCapital is carefully moving forward with its
long-planned generational change and the process of replacing the company's
founder Peter Huber in his function as a fund manager. As expected, this
change in portfolio management led to a decline in assets under management
at the German subsidiary. StarCapital offset this outflow of funds with the
acquisition of Mars Asset Management.

Bellevue Group's organic asset management growth was broadly based. In
Wealth Management, domestic and, increasingly, foreign private clients begin
to discover the solid portfolio management expertise that Bellevue Group
offers. Asset Management's equity strategies for the healthcare and medtech
sectors and in the entrepreneurial space attracted considerable interest, as
did various fixed income strategies at StarCapital. A digital health fund
launched at the end of April had a successful start. This new thematic fund
gives investors access to a global portfolio of compelling technology ideas
that additionally benefits from the attractive fundamentals of the
healthcare sector.

Bellevue Group increased its total assets under management by nearly 6% to
CHF 12.7 bn - which marks a new record high for the Group. Besides the net
inflow of new money, financial market developments and investment
performance also contributed to the steady growth in assets under
management, accounting for CHF 132 mn of the overall growth.

Outperformance of numerous equity strategies attests to the Group's
investment expertise

The skills of Bellevue's investment experts are reflected in their
better-than-average investment performance during the first half of 2018.
This substantiates the Group's ambition to create sustainable added value as
an active manager with innovative investment ideas. Supported by a still
constructive market environment, approximately 70% of all equity strategies
managed by Bellevue Group beat their respective benchmarks to the benefit of
clients. The best-performing investment vehicle managed by the Group was the
BB Adamant Global Healthcare Index Fund (CHF), which outperformed its
benchmark by nearly 14% and advanced almost 18% in absolute terms. Other top
performers in the first half were the BB Adamant Healthcare Index (USD) with
an outperformance of 12.5% (investment performance 14.0%), BB Adamant Global
Medtech & Services (CHF) with 8.4% (18.3%) and BB Entrepreneur Europe (EUR)
with 3.5% (3.2%). A superior performance was also achieved by the Group's
flagship product BB Biotech, which outperformed its benchmark by 3.6%
(8.4%), and its London-based counterpart, the BB Healthcare Trust with 7.5%
(11.5%).

Steady increase in recurring income flows - stable cost/income ratio despite
capital investment

Bellevue Group continued to improve its income flows in both quantitative
and qualitative terms. The significantly enlarged asset base at the end of
2017 laid the groundwork for this ongoing improvement and assets under
management continued to grow during the period under review. Fee and
commission income rose 11.4% yoy to CHF 48.1 mn. This quantitative
improvement was accompanied by an increase in the recurring share of income
from 78% to 94%. As in the past, Asset Management generated most of the
income. On the expense side, the focused approach of the Group's business
model led to a slight decrease in personnel costs but an increase in general
expenses, primarily due to investments in the Wealth Management unit's
technical infrastructure. A moderate increase in expenses coupled with
faster income growth resulted in a 15% increase in the Group's operating
profit to CHF 13.5 mn compared to the prior-year period. The cost/income
ratio for the first half of 2018 stood at 72.8%, which is already within the
mid-term targeted range of 70-75% despite the ongoing spending on
professional infrastructure at the Wealth Management unit. Group profit
after tax increased 17% to CHF 11.5 mn and the return on equity for the
period was a high 14.2%. Bellevue Group employed 117 people at the end of
June 2018 (prior year: 100).

Steady growth at Asset Management - expandable income base in Wealth
Management

Bellevue Asset Management has sustained its dynamic profitable growth in the
current year. Its well-diversified investment competencies - distinctive
healthcare and specialized equity strategies complemented by multi-asset
strategies and global equity and fixed income funds from StarCapital - are
highly regarded by a broad spectrum of the international investment
community. Sustained business momentum lifted assets under management by 6%
to CHF 10.6 bn and fueled another sharp rise in operating income of 29% to a
new high of CHF 46.3 mn. Operating expenses rose at a slower rate of 20% to
CHF 26.8 mn, resulting in a new record high operating profit of CHF 19.5 mn
for the Asset Management unit, which is 43% more than the figure reported
for the prior-year period.

Wealth Management, the unit which has been systematically built up within
Bank am Bellevue for the past approximately 12 months, is still in the early
stages of its planned development. Its focus on entrepreneurial private
clients is starting to bear fruit. Independent, active and highly innovative
investment advisory services are ideal for addressing individual asset and
investment needs. Furthermore, Thomas Pixner's assumption of the position of
Bank am Bellevue CEO and the election of new board director Veit de
Maddalena in March have strengthened the Wealth Management unit both
operationally and in a strategic sense. Assets under management at the unit
increased by 4% to CHF 2.1 bn during the first half thanks to new money
inflows and a positive investment performance. The bank ended the period
with an operating loss of CHF 3.3 mn, which was not unexpected as assets
under management are still low.

Outlook

Bellevue Group has positioned itself as a distinctive financial boutique
with a broad range of innovative investment skills for asset and wealth
management services. Asset Management's momentum will continue to be
actively managed, applying the simple maxim of "grow with the products and
innovate". The admission of BB Biotech AG to the SMIM Index and the SPI
Index effective September 24, 2018 marks another milestone. BB Biotech AG
will be the first investment company to join the SMIM(R) family. Two major
innovative products were recently launched, the BB Adamant Sustainable
Healthcare Fund and the BB Pureos Bioventures. Bellevue displayed its
pioneering spirit with the launch of the first fund, which is focused on
sustainability leaders in the healthcare sector, and of BB Pureos
Bioventures, a venture capital fund that invests in private early-stage
companies researching innovative drug therapies. Subscriptions and capital
commitments worth more than CHF 70 mn were already received in the first
round of funding. The total targeted investment volume for the next 12 to 18
months is CHF 200 mn.

At Bank am Bellevue, efforts will focus on growing its business activities
after its successful repositioning as a wealth manager. The top priority is
broadening its asset base and with that, its income base. This will be
realized through organic growth as well as selective acquisitions. For its
entrepreneurially oriented clients value is created by pursuing an active
and innovative investment philosophy and seeking out high-conviction
investment ideas.

The full report for the first half of 2018 is available at www.bellevue.ch

Contact

Media / Investor Relations: Daniel Koller, CFO

Telephone +41 44 267 67 00, Fax +41 44 267 67 01, ir@bellevue.ch

Bellevue Group

Bellevue Group is an independent Swiss asset and wealth management boutique
listed on the SIX Swiss Exchange. Established in 1993, the company and its
approximately 120 professionals are largely active in the areas of asset
management and wealth management. The Asset Management segment offers a
select range of active equity strategies in fast-growing markets, the
healthcare sector and in other special themes such as owner-managed
companies, as well as successful holistic investment strategies across all
traditional asset classes. Bank am Bellevue offers first-class wealth and
investment advisory services with a special focus on entrepreneurial private
clients. The Group's offering of investment-related solutions is rounded out
by other services. These include the establishment, management and
consultation of Investment Offices, trading and custody services, and
selected credit facilities for affluent private clients as well as
institutional clients.