ALTERNATIVE PERFORMANCE MEASURES
Including reconciliation to IFRS measures
2020 full-year results
INTRODUCTION
The Business Review and other communication to investors contain certain financial measures of historical and future performance and financial position that are not defined or specified by IFRS.
Management believes that these alternative performance measures (APMs) provide useful information regarding the Group's financial and operating performance. These APMs should be regarded as complementary information to, and not as a substitute for, the IFRS performance measures.
The purpose of this document is to provide the definitions of APMs used by Julius Baer Group Ltd. in its communication to investors, together with reconciliations to the most directly reconcilable IFRS line items.
APMs as defined and used by the Group may not be comparable to similarly titled APMs reported by other companies.
ADJUSTED RESULTS
Julius Baer Group Ltd. defines adjusted results as follows:
Adjusted results are derived by excluding from the IFRS financial results the operating expenses related to acquisitions or divestments (M&A) and the taxes on those respective items.
These excluded items related to M&A can include adjustments to each of the five reported IFRS expense lines (personnel expenses; general expenses; depreciation of property and equipment; amortisation of customer relationships; amortisation and impairment of intangible assets).
The M&A-related adjustments can represent inter alia items such as amortisation of acquired customer relationships; goodwill impairment charges; M&A-related restructuring costs (examples of which include employee termination benefits that relate directly to the restructuring; contract termination costs; onerous contract provisions; consulting fees that relate directly to the restructuring; expected costs from when operations cease until final disposal); fees paid to advisers on the planning, execution or financing of M&A transactions; integration-related IT or other general expenses; additional provisions set up for litigation or the recovered amount from the seller.
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Reconciliations to the most directly reconcilable IFRS line items are provided below:
CHF m | 2020 | H2 2020 | H1 2020 | 2019 | H2 2019 | H1 2019 |
IFRS net profit attributable to shareholders of Julius Baer Group Ltd. | 698.0 | 207.1 | 490.9 | 464.8 | 121.7 | 343.1 |
Non-controlling interests | 0.6 | 0.6 | 0.0 | 0.2 | 0.4 | -0.2 |
IFRS net profit | 698.6 | 207.7 | 491.0 | 465.0 | 122.1 | 342.9 |
Total adjustments to personnel expenses | 6.1 | 1.8 | 4.3 | 2.9 | 0.9 | 2.0 |
Total adjustments to general expenses1 | 13.2 | 7.6 | 5.6 | 167.5 | 160.3 | 7.2 |
Total adjustments to depreciation | 0.1 | 0.1 | - | - | - | - |
Total adjustments to amortisation and impairment of | ||||||
customer relationships | 70.1 | 40.8 | 29.3 | 81.2 | 38.0 | 43.2 |
Total adjustments to amortisation and impairment of | ||||||
intangible assets2 | 179.0 | 179.0 | - | 99.2 | 99.2 | - |
Total adjustments to operating expenses and profit before taxes1,2 | 268.5 | 229.3 | 39.2 | 350.7 | 298.4 | 52.3 |
Impact of total adjustments on income taxes | -10.6 | -4.8 | -5.8 | -43.7 | -39.0 | -4.7 |
Adjustments to net profit | 257.9 | 224.5 | 33.5 | 307.0 | 259.4 | 47.6 |
Adjusted net profit | 956.6 | 432.1 | 524.4 | 772.0 | 381.5 | 390.5 |
Adjusted non-controlling interests | 1.5 | 1.0 | 0.5 | 0.9 | 0.8 | 0.1 |
Adjusted net profit attributable to shareholders of | 955.1 | 431.1 | 524.0 | 771.1 | 380.7 | 390.4 |
Julius Baer Group Ltd. |
- Includes CHF 152.9m for "BvS case"
- Includes CHF 179.0m in 2020 and CHF 99.2m in 2019 for Kairos goodwill impairment
CHF m | 2020 | H2 2020 | H1 2020 | 2019 | H2 2019 | H1 2019 |
IFRS personnel expenses | 1,595.5 | 741.7 | 853.9 | 1,616.2 | 781.4 | 834.8 |
Adjusted personnel expenses | 1,589.4 | 739.9 | 849.5 | 1,613.3 | 780.5 | 832.8 |
Total M&A-related adjustments | 6.1 | 1.8 | 4.3 | 2.9 | 0.9 | 2.0 |
CHF m | 2019 | H2 2019 | H1 2019 | |||
2020 | H2 2020 | H1 2020 | ||||
IFRS general expenses | 710.7 | 404.6 | 306.1 | 850.8 | 526.9 | 323.9 |
Adjusted general expenses | 697.5 | 397.0 | 300.5 | 683.3 | 366.6 | 316.7 |
Total M&A-related adjustments | 13.2 | 7.6 | 5.6 | 167.5 | 160.3 | 7.2 |
o/w Total BvS-related adjustments | 4.2 | 1.4 | 2.8 | 152.9 | 152.9 | - |
Note: General expenses including provisions and losses.
CHF m | 2020 | H2 2020 | H1 2020 | 2019 | H2 2019 | H1 2019 |
IFRS provisions and losses | 92.6 | 88.5 | 4.1 | 213.9 | 191.6 | 22.3 |
Adjusted provisions and losses | 89.0 | 87.3 | 1.8 | 61.2 | 38.9 | 22.3 |
Total M&A-related adjustments | 3.6 | 1.2 | 2.4 | 152.7 | 152.7 | - |
o/w Total BvS-related adjustments | 3.6 | 1.2 | 2.4 | 152.7 | 152.7 | - |
Note: In December 2019, Julius Baer booked a CHF 153 million (CHF 119 million net of taxes) provision related to the claim by the Bundesanstalt für vereinigungsbedingte Sonderaufgaben (BvS) (against Bank Julius Baer & Co. Ltd.as successor to Bank Cantrade Ltd., which was acquired in 2005) in relation to alleged unauthorised withdrawals between 1990 and 1992 from a Cantrade account.
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CHF m | 2020 | H2 2020 | H1 2020 | 2019 | H2 2019 | H1 2019 | |
IFRS depreciation of property and equipment | 100.5 | 51.1 | 49.4 | 100.0 | 51.2 | 48.9 | |
Adjusted depreciation of property and equipment | 100.4 | 51.0 | 49.4 | 100.0 | 51.2 | 48.9 | |
Total M&A-related adjustments | 0.1 | 0.1 | - | - | - | - | |
CHF m | 2019 | H2 2019 | H1 2019 | ||||
2020 | H2 2020 | H1 2020 | |||||
IFRS amortisation and impairment of customer relationships | 70.1 | 40.8 | 29.3 | 81.2 | 38.1 | 43.2 | |
Adjusted amortisation and impairment of customer relationships | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |
Total amortisation and impairment of customer relationships adjustments | |||||||
related to previous acquisitions | 70.1 | 40.8 | 29.3 | 81.2 | 38.0 | 43.2 | |
o/w ING | - | - | - | 16.3 | 8.2 | 8.2 | |
o/w IWM | 35.9 | 18.2 | 17.7 | 40.6 | 17.6 | 23.0 | |
o/w GPS | 2.8 | 1.3 | 1.5 | 3.8 | 1.9 | 2.0 | |
o/w Kairos | 20.3 | 15.9 | 4.5 | 8.9 | 4.5 | 4.5 | |
o/w Commerzbank Luxembourg | 1.7 | 0.8 | 0.8 | 1.7 | 0.8 | 0.8 | |
o/w Leumi | 1.0 | 0.5 | 0.5 | 1.0 | 0.5 | 0.5 | |
o/w Fransad | 0.9 | 0.5 | 0.5 | 0.9 | 0.5 | 0.5 | |
o/w Wergen | 0.8 | 0.4 | 0.4 | 0.8 | 0.4 | 0.4 | |
o/w WMPartners | 1.4 | 0.7 | 0.7 | 1.4 | 0.7 | 0.7 | |
o/w Reliance | 2.3 | 1.1 | 1.2 | 3.3 | 1.6 | 1.7 | |
o/w NSC Asesores | 3.0 | 1.5 | 1.5 | 2.5 | 1.5 | 1.0 | |
CHF m | 2019 | H2 2019 | H1 2019 | ||||
2020 | H2 2020 | H1 2020 | |||||
IFRS amortisation and impairment of intangible assets | 260.4 | 225.4 | 35.0 | 168.5 | 137.7 | 30.7 | |
Adjusted amortisation and impairment of intangible assets | 81.3 | 46.4 | 35.0 | 69.3 | 38.6 | 30.7 | |
Total amortisation and impairment of intangible assets adjustments | 179.0 | 179.0 | - | 99.2 | 99.2 | - | |
o/w Kairos goodwill impairment | 179.0 | 179.0 | - | 99.2 | 99.2 | - | |
CHF m | 2019 | H2 2019 | H1 2019 | ||||
2020 | H2 2020 | H1 2020 | |||||
IFRS operating expenses | 2,737.2 | 1,463.6 | 1,273.6 | 2,816.7 | 1,535.2 | 1,281.5 | |
Adjusted operating expenses | 2,468.7 | 1,234.3 | 1,234.4 | 2,465.9 | 1,236.8 | 1,229.2 | |
Total M&A-related adjustments | 268.5 | 229.3 | 39.2 | 350.7 | 298.4 | 52.3 | |
o/w Adjustments to personnel expenses | 6.1 | 1.8 | 4.3 | 2.9 | 0.9 | 2.0 | |
o/w Adjustments to general expenses | 13.2 | 7.6 | 5.6 | 167.5 | 160.3 | 7.2 | |
o/w Adjustments to depreciation | 0.1 | 0.1 | - | - | - | - | |
o/w Adjustments to amortisation and impairment of | |||||||
customer relationships | 70.1 | 40.8 | 29.3 | 81.2 | 38.0 | 43.2 | |
o/w Adjustments to amortisation and impairment of | |||||||
intangible assets | 179.0 | 179.0 | - | 99.2 | 99.2 | - | |
CHF m | 2019 | H2 2019 | H1 2019 | ||||
2020 | H2 2020 | H1 2020 | |||||
IFRS profit before taxes | 845.9 | 268.7 | 577.2 | 566.2 | 148.7 | 417.5 | |
Adjusted profit before taxes | 1,114.5 | 498.0 | 616.4 | 916.9 | 447.1 | 469.8 | |
Total M&A-related adjustments to personnel expenses, | |||||||
general expenses and depreciation | -19.4 | -9.5 | -10.0 | -170.4 | -161.2 | -9.1 | |
Total M&A-related adjustments to amortisation and impairment | -249.1 | -219.9 | -29.3 | -180.4 | -137.2 | -43.2 | |
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Julius Bär Gruppe AG published this content on 01 February 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 01 February 2021 06:11:01 UTC.