VZ Group gained a swathe of new clients in the first half of 2021 and enjoyed a substantial rise in profits, helped by favorable market conditions.
The first-half profit of VZ Group, which offers asset management and advisory services, grew around 21 percent from a year earlier to 68.4 million Swiss francs ($74.2 million), the Zug-based company said in a results statement Wednesday.
Operating income was around 18 percent higher year on year at 187.8 million francs.
However, due to pandemic-related restrictions in the first quarter, consulting fees rose more slowly at around 16 percent. By contrast, the increase in income from assets under management increased 22 percent. This is the most important earnings component, VZ added.
Markets, New Clients Boost Earnings
Half of the increase in profits came from bullish stock markets resulting in growth in the value of assets under management, and the other half from new private and corporate customers.
VZ said demand for its services rose sharply. In administrative services, the number of new customers grew by a good 30 percent year on year to 4,028 in the first half of 2021. This was also directly reflected in net new money, which increased to 2.5 billion francs from 1.6 billion a year earlier.
Stake in U.K. Company
Total assets as of June 30 grew to 5.4 billion francs from 5.0 billion at the end of 2020.
At 23.2 percent, the core capital ratio was 1.5 percentage points lower. VZ said this was down to its stake in U.K-based Independent Financial Advisor (IFA).
Growth Seen Continuing
«We expect a further increase in the number of customers in the second half of the year and correspondingly higher yields in all areas, provided the markets are stable. Only revenues from banking-related transactions are are difficult to predict,» CEO Matthias Reinhart said in the statement, adding: «On the whole, growth in the second half of the year is likely to be roughly similar to that in the first.»
