Interim Report 1 January – 30 September 2011 for Catella AB (publ)

Third quarter of 2011, july – september

• Net sales in the third quarter totalled SEK 138 M (0). Excluding invoiced direct assignment costs and commission, income amounted to SEK 112 M (0).
• Profit after tax for the period amounted to SEK -60 M (-25). Profit for the period was charged with impairment losses totalling SEK -47 M (-20), of which SEK -39 M refers to write-downs of the loan portfolios.
• Earnings per share for the Group’s total operations for the period amounted to SEK -0.73 (-0.31).

First nine months of 2011, January – september

• Net sales in the first nine months of the year totalled SEK 488 M (0). Excluding invoiced direct assignment costs and commission, income amounted to SEK 376 M (0).
• Profit after tax for the period amounted to SEK -45 M (-10). Profit for the period was charged with impairment losses totalling SEK -40 M (-33), of which SEK -39 M refers to write-downs of the loan portfolios.
• Earnings per share for the Group’s total operations for the period amounted to SEK -0.55 (-0.14).

CEO's Comment
The third quarter is normally weak for Catella in terms of earnings. This year’s quarterly results were also impacted adversely by the turmoil in the European financial markets. This resulted in lower transaction volumes than normal in the Corporate Finance segment and lower volumes in Catella’s Swedish asset management units, mainly due to declining share prices.

Although this financial turbulence has brought about austerity measures in the markets, it has also resulted in increased demand for specialist financial services in such areas as financing, debt management and financial restructuring. In the Corporate Finance segment, Catella’s transaction and property expertise was strengthened through a further expansion of its financial know-how, facilitating for Catella to take a leading role in the restructuring work that will take place in the coming years. Moreover, the establishment of a special unit for fixed-income products was a crucial step toward strengthening Catella’s presence in the market for financing and debt management. The initial costs associated with the start-up of this new operation will be charged against consolidated profit.

In Catella’s Asset Management segment, a review of the Swedish fund structure is currently being performed with the aim of increasing focus and creating a more straightforward and competitive fund offering. At the same time, projects have been initiated to boost coordination between Catella’s Swedish fund and wealth management operations with the intention of enhancing efficiency and reducing costs. The German property fund operations have successfully launched new funds, resulting in increased management volumes and bolstering future earnings.

Catella’s proprietary Treasury Management operations primarily comprise a number of portfolios of European securitised mortgage loans. Although these portfolios have delivered stronger returns than forecast to date, the portfolio value was charged with an impairment loss in the third quarter. This impairment loss was not recognised due to an actual loss, but rather was based on new risk assumptions given a more cautious macroeconomic market outlook. Treasury Management’s impairment losses totalled SEK 45 M, which accounts for a significant portion of the loss for the third quarter.

The sale of Banque Invik remained in progress during the third quarter and will continue in the fourth. Due to the prevailing market conditions in autumn 2011, the sales process has taken longer than originally planned and Catella is thus unable to present a formal conclusion. Negotiations are under way with several prospective buyers.

As a financial group, Catella is impacted by the turbulence in the financial markets, not due to a shortage of ongoing assignments or substantial outflows of capital, but rather because projects have become more difficult to implement and take longer to complete. Although negative market changes will have a short-term adverse impact on the company, Catella is finding that new earnings opportunities are being created for both the Corporate Finance and Asset Management operations.

For more information, please contact:
Johan Ericsson
Chief Executive Officer, Catella
+46 8 463 33 10

Investor Relations
Niklas Bommelin
Investor Relations, Catella
+46 8 463 33 10

About Catella: Catella is a European finance group active in Corporate Finance and Asset Management. In these operating segments, Catella focuses on selected segments in which advanced specialist expertise and local presence, combined with international reach, are key in creating added value for clients. Catella has approximately 450 employees working at offices in 24 cities in 12 European countries. Catella share is listed on First North Premier and traded under the abbreviations CAT A and CAT B. Remium AB is Catella’s Certified Adviser, 46 8 454 32 00. Read more about Catella at www.catella.se.

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