VZ Group increased its profit disproportionately in the past financial year and plans to reward its shareholders with a dividend increase.
VZ Group, which is active in asset management and advisory services, increased its profit by almost 15 percent to 117.5 million Swiss francs ($126.4 million) in 2020. This was accompanied by growth in operating income of almost 9 percent to 328.7 million francs, according to a statement released on Friday.
An important reason for the disproportionate increase in net profit is the lower tax rate of now 14 percent (previously 17.7 percent). VZ Group has its headquarters in the city of Zug.
Acceleration in the Second Half
The course of business improved steadily over the course of the Corona year. For example, income grew by 10.4 percent in the second half of the year, compared with the 7.4 percent in the first. Because on-site advisory services were limited, especially in the spring, fees grew at a slower pace, and the slump in stock market prices in the first half of the year slowed the growth of wealth management revenues, VZ Group said.
Over the year as a whole, the group was able to attract 6,400 new clients for its management services, a clear increase from the previous year's 5,000. The group was also able to increase net new money by 18.4 percent to 3.2 billion francs.
Further Growth Expected in 2021
The positive course of business should also benefit shareholders, as already announced at the presentation of the half-year figures last August. VZ Group is proposing to the annual general meeting an increase of its dividend from 1.02 francs to 1.23 francs per share. This would increase the proportion of distributed profit from 40 to 42 percent. In the long term, VZ Group is aiming for a payout ratio of 50 percent.
The Group's business is also doing well in 2021: «We expect a similar development in demand for the current year,» says Matthias Reinhart, chief executive officer of VZ Group. «If the markets remain stable, revenue and profit should again grow in step.»
