Interim Report January–June 2015

• Net inflow totalled SEK 14,400 million (SEK 9,560m), corresponding to 10 (8 %) per cent of the total savings capital at the beginning of the year
• The number of customers increased by 14 (8 %) per cent to 423,500 (371,200 as of 31 December 2014)
• The total savings capital increased by 20 (16 %) per cent to SEK 170,000 million (SEK 141,900m as of 31 December 2014)
• Operating income increased by 36 (17 %) per cent to SEK 459 million (SEK 337m)
• Operating margin was 52 (42 %) per cent
• The profit after tax increased by 68 (57 %) per cent to SEK 203 million (SEK 121m)
• Earnings per share increased by 67 (57 %) per cent to SEK 7.00 (SEK 4.18)
• No significant events have occurred after the end of the reporting period

Second Quarter                                     

• Operating income increased by 43 percent (20 %) to SEK 234 million (SEK 164m)
• The profit after tax increased by 86 percent (75 %) to SEK 104 million (SEK 56m)
• Earnings per share increased by 86 percent (73 %) to SEK 3.57 (1.92)

 Quarterly highlights

• Avanza Markets, commission-free trading in certificates and mini futures, was launched in May
• In June the Portfolio Generator was launched, a digital service that allows fund savers to create a fund portfolio with a good risk diversification
• In a scientific study, Sustainability Index 2015, Avanza received the highest score among the financial participants
• New mobile apps for iOS and Android was launched in the beginning of the summer
• Brokerage fees on trades on foreign markets was reduced in connection with the app launch
• MTG Sweden chose Avanza’s occupational pension plans for around 1,000 employees

Comments from the CEO

Operating profit up by 81 per cent

Our strongest quarterly result to date, driven by high trading volumes, high customer growth and high activity in Corporate Finance.

While the first quarter of the year was marked by optimism and rising share prices, the second has been significantly more volatile. In the wake of the crisis in Greece many customers have started to adjust their savings towards safe investments, resulting in a high level of activity in the equity market and a shift among fund investors towards interests and lower risk as the summer approaches. Many have also reviewed their bank relationships. With 20,500 new active customers (+78 per cent) in the second quarter, we gained a total of 52,300 new customers in the first six months of the year (+101 per cent). We have thus comfortably exceeded our target of 30,000 – 40,000 new customers per year.

The impact of the market situation coupled with our new price plans is shown in our trading figures, with the number of trades per customer per month up by a massive 52 per cent compared with the same quarter in 2014. The activity in the market is also evident in a strong quarter for our Corporate Finance department, which saw revenues grow by 74 per cent year on year. This shows that our ambition of taking on contracts higher up the value chain for smaller companies has started to bear fruit.

Yet the current market situation is also putting mounting pressure on our interest income. The growth in deposits which has previously largely offset falling interest margins is now instead weighing on our net interest income due to the negative market interest rates. This has led to a 29 per cent reduction in net interest income compared with the previous year. Despite this, we are able to present our strongest result to date in the second quarter, with an operating profit of SEK 121m, an increase of 81 per cent compared with the same period in 2014.

Continuing to challenge the market with new services

One of our key development projects this year has been the new mobile service that was launched in June. Our new mobile apps for iOS and Android allow users to trade in Nordic, US and Canadian shares as well as funds and to set up watch lists – the services that have been most in demand from our customers. In connection with the launch of our new mobile service we also reduced our prices on trading on foreign markets and now offer a minimum brokerage fee on US trades that is one hundredth of what the big banks are offering.

Another important development project that saw the light of day in June was our new decision support service for fund savings – the Portfolio Generator. Fund savings in Sweden are growing every year and reached new record levels last year, with over SEK 150 billion invested in funds. At the same time only two out of ten fund savers currently have adequate risk diversification, geographically and in terms of the number of funds. The Portfolio Generator is a new digital service that allows fund savers to create a fund portfolio with a good risk diversification in three simple steps based on those funds which have the highest ratings regarding fees, risk and return.

 In the second quarter we launched, as the only bank in Sweden, commission-free trading in certificates and mini futures – Avanza Markets. We also introduced the option of selecting funds based on sustainability. 

Continued development

In view of the gradual change in customer behaviour prompted by new technological advances, we believe continued development of mobile services and digital savings tools will be key development areas going forward. Having introduced our first services in these areas, I am confident that we are well equipped with a more competitive product and service offering than ever before.

Stockholm, 14 July 2015

Martin Tivéus, CEO Avanza

For further information please contact:   

Martin Tivéus, CEO
46 70 861 80 04
martin.tiveus@avanza.se

Birgitta Hagenfeldt, CFO
46 73 661 80 04
birgitta.hagenfeldt@avanza.se

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