Mandatum Q3 on Wednesday: First peek under the hood
Translation: Original comment published in Finnish on 11/3/2023 at 7:17 am EET
Mandatum will publish its Q3 result on Wednesday at 9.30–10.30 am EET. The quarterly report is Mandatum’s first as a separate company from Sampo, so there is exceptionally high interest in the report. We expect Q3 PTP to be approximately EUR 40 million. Before the release date, we recommend that you read our recent extensive report and watch our video about the company to refresh your memory .
The content of the report is still a question mark at this stage
The report will be interesting in many ways, but the main focus will in all its simplicity be on the form and content of the report. At the moment, there is no certainty as to which indicators the company will report in the first place, as the information presented in the demerger prospectus and the investor event was incomplete in this respect.
Therefore, we emphasize that deviations to our forecasts can be large, as the visibility to the formation of the result, especially at a quarterly level, is foggy to say the least. We expect the report to give us a much better basis for our own modeling. However, we note that even with more detailed information about the company’s business model and the significant with-profit portfolio, forecasting at the quarterly level will continue to be extremely challenging.
We expect a rather strong result
Income from investment contracts include fees and expenses for asset management and a majority of unit-linked insurance. However, the majority of unit-linked pension insurance policies are still recorded through the insurance service result, as their conditions differ somewhat from other unit-linked products. These together form Mandatum’s commission result, which we expect to have been around EUR 12 million in Q3. We expect Mandatum’s AUM to have increased from approximately EUR 11.2 billion at the end of June to approximately EUR 11.4 billion.
The result of term life insurance consists mainly of the contractual service margin (CSM), which Mandatum recognizes in the balance sheet throughout the contract period. In a somewhat simplified approach, the CSM in the balance sheet can be interpreted as Mandatum’s estimate of future returns (considering the time value of money) from current life insurance contracts. We expect the result of term life insurance to be good EUR 3 million in Q3.
We expect a result of approximately EUR 26 million (return on investment portfolio at fair value ~1%) from investment activities (with-profit portfolio) and approximately zero from the Other segment. As a sum of the above, we expect the Group’s profit before taxes to be around EUR 40 million.
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Mandatum
Mandatum has operations within the financial sector. The company offers various financial services to both private savers and corporate customers. The range is broad and mainly includes capital and wealth management, savings and investments, compensation and rewards, pension plans and personal risk insurance. The largest operations are found in Finland.
Read more on company pageKey Estimate Figures12.10.2023
2022 | 23e | 24e | |
---|---|---|---|
Revenue | 126.0 | 127.7 | 137.8 |
growth-% | -58.82 % | 1.34 % | 7.90 % |
EBIT (adj.) | 75.7 | 184.7 | 214.0 |
EBIT-% (adj.) | 60.08 % | 144.67 % | 155.29 % |
EPS (adj.) | 0.15 | 0.29 | 0.34 |
Dividend | 0.39 | 0.33 | 0.35 |
Dividend % | 7.90 % | 8.38 % | |
P/E (adj.) | - | 14.29 | 12.25 |
EV/EBITDA | - | 11.45 | 9.92 |