Notes to the income statement
 

10 Revenue

All figures in €'00020152014
Old-age provision215,738239,729
Wealth management165,982147,034
Non-life insurance54,87834,573
Health insurance45,91843,452
Loans and mortgages16,18613,622
Other commission and fees15,5798,449
Total commission income 514,282486,858
Interest income21,36922,869
Total535,651509,727

Other commission and fees include revenue from property brokerage of € 11,325 thsd (previous year: € 4,218 thsd).

11 Other revenue

All figures in €'00020152014
Reversal of impairment losses/income from written-off receivables2,8622,096
Income from the reversal of provisions2,7143,482
Income from the reversal of deferred obligations2,2531,240
Own work capitalised1,322746
Rent1,2591,271
Income from the disposal of fixed assets915
Remuneration of management8961,029
Cost transfers to commercial agents745841
Income from the disposal of fixed assets802,070
Sundry other income 8,4838,602
Total21,52921,378

The item “Reversal of impairments/income from written-off receivables” refers to the item “Receivables from clients in the banking business” at € 1,072 thsd (previous year: € 1,440 thsd) and to the item “Other receivables and assets” at € 1,790 thsd (previous year: € 656 thsd). It contains income from the reversal of provisions in the lending business of € 109 thsd (previous year: € 88 thsd). This revenue is offset against expenses from the allocation of allowances for bad debts, which are recorded under “Other operating expenses”.

 

For more information on income from the reversal of provisions, please refer to Note 30.

 

Income from the reversal of deferred obligations essentially comprises income from the reversal of provisions for profit-sharing payments.

 

Own work capitalised results from the collaboration of Group employees in the development of acquired software and software created in-house.

 

Rental income essentially results from the letting of an investment property that was classified as non-current asset held for sale on the balance sheet date.

 

Income from the disposal of investments results from the sale of the stake in Absolventa GmbH, Berlin.

 

The item “Remuneration for management” contains pre-allocated profits due to management tasks for private equity companies.

 

The item “Cost transfers to commercial agents” essentially comprises income from cost transfers of insurance companies, services and material costs.

 

Sundry other income includes income from cost reimbursement claims, income from investments and offset remuneration in kind.

12 Commission expenses

Commission expenses mainly consist of the commission payments and other remuneration components for the self-employed MLP consultants.

13 Interest expenses

All figures in €'00020152014
Interest and similar expenses
Financial instruments measured at amortised cost1,8072,693
Available-for-sale financial instruments 4087
Change fair value option
Financial instruments at fair value through profit and loss 7458
Total1,9212,838

Interest expenses of € 1,259 thsd (previous year: € 2,072 thsd) are attributable to interest charges for liabilities due to clients in the banking business.

14 Personnel expenses

All figures in €'00020152014
Salaries and wages98,11591,599
Social security contributions12,93211,996
Expenses for old-age provisions and benefits2,4102,369
Total113,457105,964

Personnel expenses essentially include salaries and wages, remuneration and other payments to employees. The social security contributions include the statutory contributions to be borne by the company in the form of social security insurance premiums. Expenses for old-age provisions and benefits mainly include the employer’s shares of supplementary occupational pension provision.

15 Depreciation and impairments

All figures in €'00020152014
Intangible assets6,5987,912
Property, plant and equipment5,7105,442
Investment property3263
Depreciation12,33913,417
Intangible assets1,584
Investment property1,116
Non-current assets held for sale73
Impairment2,774
Total15,11313,417

Impairments include impairment losses of € 1,584 thsd for software that is still in the development stage (previous year: € 0 thsd).

The development of non-current assets is disclosed in Note 21 (intangible assets), Note 22 (property, plant and equipment) and Note 23 (investment property / non-current assets held for sale).

16 Other operating expenses

All figures in €'00020152014
IT operations47,61047,932
Rental and leasing14,37613,419
Consultancy12,99513,209
Administration operations11,52811,236
Representation and advertising7,9417,892
External services – banking business7,2776,456
Other external services6,5283,992
Training and further education4,3693,554
Premiums and fees4,2313,591
Travel expenses3,8633,714
Depreciation/allowances for bad debts2,7064,118
Insurance2,6242,393
Entertainment2,5882,803
Expenses for commercial agents2,5321,384
Maintenance2,3902,197
Goodwill1,319494
Other employee-related expenses1,2901,151
Audit1,0711,002
Supervisory Board remuneration9691,032
Sundry other operating expenses6,0275,825
Total144,234137,394

The costs of IT operations are mainly attributable to IT services and computer centre services that have been outsourced to an external service provider.

 

The consulting costs are made up of tax advice costs, legal advice costs as well as general and IT consulting costs. Consulting expenses include expenses of € 1,119 thsd in the context of the acquisition of the DOMCURA Group.

 

The expenses for administration operations contain costs relating to building operations, office costs and communication costs.

 

Expenses for representation and advertising include costs incurred due to media presence and client information activities.

 

The item “External services - banking business” mainly contains securities settlement and transaction costs in connection with the MLP credit card. Expenses for commercial agents include costs for former consultants and the training allowance granted for new consultants.

 

Amortisation expenses/impairments on other receivables comprise amortisation expenses/allowances for other receivables and other assets of € 2,336 thsd (previous year: € 3,215 thsd) and amortisation expenses/impairments on receivables due from clients in the banking business of € 370 thsd (previous year: € 903 thsd).

 

Sundry other operating expenses essentially comprise expenses for other taxes, passenger vehicles, literature and charitable donations.

17 Earnings from investments accounted for using the equity method

Earnings from investments accounted for using the equity method were € 1,836 thsd in the financial year (previous year: € 1,127 thsd) and resulted from the share of earnings in MLP Hyp GmbH. In line with a company agreement, the profit distribution of MLP Hyp GmbH is disproportionate.

 

Investments accounted for using the equity method relate only to the 49.8% share in MLP Hyp GmbH, Wiesloch. The company operates the joint mortgage financing business of MLP Finanzdienstleistungen AG, Wiesloch, and Interhyp AG, Munich.

All figures in €'00020152014
Share as of Jan. 1 2,7722,547
Dividend payouts -1,127-902
Pro rata profit after tax 1,8361,127
Share as of Dec. 31 3,4812,772

The following table contains summarised financial information on MLP Hyp GmbH:

All figures in €'000Dec. 31, 2015Dec. 31, 2014
Non-current assets5358
Current assets7,6405,580
Non-current liabilities-13
Current liabilities-1,868-891
Net assets (100 %)5,8254,734
of which MLP's share in net assets (49.8 %)2,9012,358
Incidental acquisition costs151151
Dividend payout-1,279-1,015
Cumulative disproportionate profit 1,7081,279
Carrying amount of the investment3,4812,772
Revenue12,5269,226
Total comprehensive income (100 %)2,8251,734
of which MLP's share in total comprehensive income (49.8 %)1,407864
Disproportionate profit for the current financial year (65 %)429264
MLP's share in total comprehensive income1,8361,127

18 Finance cost

All figures in €'00020152014
Other interest and similar income509669
Interest expenses from financial instruments-145-391
Interest expenses from net obligations for defined benefit plans-481-585
Other interest costs-2,637-1,030
Other interest and similar expenses-3,263-2,007
Finance cost-2,753-1,337

Other interest and similar income of € 140 thsd (previous year: € 293 thsd) is attributable to interest income from deposits with financial institutions which were not included in the banking business segment and € 49 thsd (previous year: € 41 thsd) is attributable to income from the discounting of provisions. Other interest and similar expenses include expenses from the accrued interest of other provisions totalling € 584 thsd (previous year: € 833 thsd).

19  Income taxes

All figures in €'00020152014
Income taxes8,1708,694
of which current taxes on income and profit9,78310,720
of which deferred taxes-1,613-2,026

The current taxes on income and profit include expenses of € 1,967 thsd (previous year: € 2,062 thsd) which relate to previous periods.

 

The current and deferred tax is calculated using the relevant country-specific income tax rate. The anticipated combined income tax rate for domestic companies is made up of corporation tax at 15.0% (previous year: 15.0%), the solidarity surcharge at 5.5% (previous year: 5.5%) and an average municipal trade tax rate of 13.37% (previous year: 13.37%) and amounts to 29.19% (previous year: 29.19%).

 

The taxation rates likely to be applicable at their time of implementation should be used to calculate deferred income taxes. The taxation rates used here are those that are valid or have been announced for the periods in question as of the balance sheet date.

 

The following reconciliation account shows the relationship between the earnings before tax and the taxes on income and profit in the financial year:

All figures in €'00020152014
Earnings before tax27,95337,649
Group income tax rate29.19 %29.19 %
Calculated income tax expenditure in the financial year8,15910,990
Tax-exempt earnings and permanent differences-3,587-2,881
Non-deductible expenses1,485977
Divergent trade taxation charge211393
Effects of other taxation rates applicable abroad44
Income tax not relating to the period (current and deferred)2,249-846
Tax effects from tax rate changes053
Other -3514
Income taxes8,1708,694

The effective income tax rate applicable to the earnings before tax is 29.2% (previous year: 23.1%).

The item of tax-exempt earnings and permanent differences in earnings includes profit contributions from the FERI Group and the tax-free dividends of MLP Hyp GmbH.

Non-deductible expenses are due to entertainment costs, gifts and other such matters.

The tax deferrals result from the balance sheet items as follows:

All figures in €'000Deferred tax assetsDeferred tax liabilities
Dec. 31, 2015Dec. 31, 2014Dec. 31, 2015Dec. 31, 2014
Intangible assets1,3811,14513,57910,992
Property, plant and equipment3,5773,327
Financial assets110262340
Investment property833919
Other assets3,5092,213210580
Provisions10,34711,1891,843
Liabilities1,474935330
Gross value16,82115,48220,33716,158
Netting of deferred tax assets and liabilities-9,788-8,754-9,788-8,754
Total7,0336,72810,5497,404

The deferred tax expense recognised under other comprehensive income outside the income statement is € 636 thsd (previous year: tax income of € 2,312 thsd).

 

Tax refund claims include € 9,378 thsd (previous year: € 10,554 thsd) of corporation tax and € 5,515 thsd (previous year: € 8,189 thsd) of trade tax. The major portion of € 14,668 thsd (previous year: € 18,704 thsd) is attributable to MLP AG.

 

Tax liabilities are made up of € 2,638 thsd (previous year: € 3,408 thsd) of corporation tax and € 1,369 thsd (previous year: € 2,123 thsd) of trade tax, of which € 333 thsd (previous year: € 4,000 thsd) is attributable to MLP AG.

 

The tax liabilities are due to taxes on the income and profit of the individual companies based on the corresponding national tax regime. Contingent tax liabilities are shown under deferred tax liabilities.

 

As of December 31, 2014, MLP established a provision of € 4 million for anticipated retrospective tax payments arising from the tax audit by the fiscal authorities. As a result of a reassessment of the circumstances investigated in conclusion of the audit, additional tax expenses of € 1.1 million and an interest charge of € 2.0 million were recognised in the finance cost in the third quarter of 2015.

 

In two further disputed cases, MLP anticipates being able to assert its legal position based on the expert’s reports available. In this respect, MLP has recognised an asset for the retrospective tax payment made.

20 Earnings per share

 

The calculation for the basic and diluted earnings per share is based on the following data:

All figures in €'00020152014
Basis of the basic / diluted net profit per share19,78328,955
All figures in number of units
Weighted average number of shares for the basic / diluted net profit per share108,484,800107,877,738

The basic and diluted earnings per share are € 0.18 (previous year: € 0.27).