Bellevue reports market-driven decrease of net profit to CHF 15.2 mn – dividend proposal of CHF 1.15 – promising recovery of key markets since Q4 2023 - Seite 2

Market driven decline of assets under management – reallocation by clients offsets gross new money raised

The healthcare sector overall saw one of the worst relative annual investment performances in 2023 due to continued interest rate hikes, increasing inflation expectations and geopolitical tensions. It did not help that particularly China and Hong Kong continued to exhibit poor investment performances due to the deteriorating domestic situation and political concerns. These developments have been impacting the assets under management significantly, given Bellevue’s focus within the healthcare sector on smaller and medium-sized growth companies and more balanced regionally weighted strategies including Asia/China. In parallel, clients shifted some of their investments during the second half of the year. These reallocations significantly outweighed gross new money raised of almost CHF 600 mn in this challenging market environment. As a consequence, assets under management have decreased substantially from CHF 9.4 bn to CHF 6.9 bn. This drop of 26% was driven roughly half by the negative market environment and half by the reallocations by clients.

Earnings decline due to lower asset base – performance fee from private market exit

In line with this development, the revenues from management fees decreased by 24% to CHF 79.3 mn, based on an average AuM base of circa CHF 8.2 bn. Total operating income amounted to CHF 81.9 mn and were just 15% lower than the previous year mainly due to an improved net financial investment result but also due to the realization of performance fees of CHF 2 mn from an exit in the private market business. On the cost side, the performance-linked compensation model ensures flexible personnel expenses aligned with the business and investment performance development. Hence, personnel costs were reduced by 7%. Despite continued investments into investment talents and expertise (data scientist for AI/big data, sales team in Switzerland and Germany) as well as in infrastructure and technology (AI solutions), operating costs are 5% lower year-on-year. Nevertheless, the resulting net profit of CHF 15.2 mn is down 40% on a year-on-year basis. The cost income ratio of 71% is more than the medium target range of 60-65%. The return on equity is 14.2% (previous year: 23.2%).