Mediobanca closed the 12 months from June 2023 to June 2024 with historical records: revenues of 3.606 billion (+9% year-on-year), net income of 1.273 billion (+24% year-on-year), earnings per share of 1.53 euros (+27% ), high profitability (Rote at 14%, +1%), dividend per share (dps) at 1.07 euros (+26%).
The accounts for the second quarter of 2024
Regarding the second quarter of 2024, the interest margin was 492.4 million (502.1 a year earlier), the intermediation margin was 978.6 million (884.7 in 2023), the structural costs for 418.2 million (from 378.2 million ), the total result of 438.6 million (from 361.8 million), the net income of 327.3 million (from 234.9 million).
The consensus of analysts collected by the same Mediobanca it expects interest margin (NII) of 493 million, revenues of 943 million, gross profit of 533 million and net profit of 314 million. The cost of risk is down 48 basis points (-4 bps), while the capital solidity index, fully loaded pro forma Cet1 is at 15.2% (as of March 2024).
Of the 1.27 billion of the group recorded in the relevant year 23-24, Wealth Management contributes 208.5 million, Consumer Finance for 382.9 million, CIB (Corporate and Investment Banking) for 243.5 million, the Insurance sector for to 522 million.
Big dividend
The board of directors now proposes the distribution of a total annual dividend of 1.07 euros (at current prices this corresponds to a dividend yield of 7.13%) per share with a payout of 70%, which, taking into account the prepaid in May ( 0.51 euros) corresponds to the November balance of 0.56 per share. The amount is due on 20th November with record date on 19th November and ex-date on 18th.
New buyback (with cancellation of shares) for 385 million (3.1% capital)
The board then proposes the launch of a plan for the buyback and cancellation of treasury shares (the second during the 23/26 Plan), in the amount of approximately 385 million which, at today’s prices, corresponds to 3.1% of social capital. The number of shares will be set when the budget is approved in September. Of these, up to 80% can be cancelled.
The 2024-2025 guidance
For the financial year 24-25 Mediobanca expected annual collection of 9/10 billion. THE earnings they are expected to increase due to continued growth (low double digits) in commissions, driven by Wealth Management and CIB’s less capitalized services; The interest margin will maintain a rising but limited trajectory (low single digits) favored by Consumer Finance, which is more resilient in a context of falling rates; The cost/income ratio (C/I) will stand at 44% with “ambitious investment plans in digital and distribution (especially in Wealth Management); the risk value is expected at 55 basis points; L’earnings per share (eps) it is expected to grow by 6/8%1; there shareholder compensation provides an expected growth in dividend per share, with a cash payout confirmed at 70% (interim dividend in May 2025 and balance in November 2025) and activation of a new buyback plan (385 million).
CEO Alberto Nagel: profitability at historic highs
Alberto Nagel, CEO of Mediobancaemphasizes that “in the 2023-24 financial year the group was able to achieve the best results ever in terms of revenues (3.6 billion), profit (almost 1.3 billion), profitability (Rote 14% ) and distribution to shareholders (1.1 billion between dividends and buybacks carried out), immediately launched the main initiatives of the 23-26 Plan”.
The scenario of the coming months, Nagel added, is “uncertain due to geo-political and macro dynamics and will require the ability to turn the expected volatile context into an opportunity. Mediobanca is in a privileged position due to the specialization of its model, the responsible strategy, the unique product skills, the positioning, unique in Italy, among business families”.
The group Mediobanca “Today it is centered on wealth management activities, where it represents 925 million in revenues, 30% of the group and 52% of total commissions”, explained CEO Nagel in a media call on the results. The activity “produces 210 million in revenue and generates net new money of 8 billion, a number that puts Mediobanca among the top 3 or 4 wealth management networks in terms of collection, and we entered this business about 10 years ago.” Nagel added that “the group’s industrial trajectory is in line with our expectations” and that the “numbers are higher than our forecasts and also the consensus.”
The analysts
Second David Pascucci, market analyst at XTB“an excellent quarterly Mediobanca which continues its growth plan in all divisions, from wealth management to consumer finance, setting an all-time record in terms of revenues, profits, profitability and distribution to shareholders”.
High rates have certainly benefited the banking sector over the past few years and future moves by the ECB regarding possible rate cuts could slow down the entire banking sector Furthermore, macroeconomic dynamics are worsening in the USA, dynamics that often reverberate in Europe with certainty. delay, therefore the greatest attention is paid to the evolution of market trends, which are strongly related to employment and interest rate dynamics in any case Mediobanca presents good accounts where the group is positioned in possible opportunities for the future, even and above all after the end of the cycle of rate cuts”, concluded the analyst.
KBW Confirms the Underperform rating and the price target of 15.66 euros on the stock since then Mediobanca it has run 4% above the European banking index over the past month. Analysts talk about “net profit grew by 4% thanks to better commissions. Pro forma CET1 remains solid at 15.2%”. The stock’s total yield (remaining dividend payable + buyback) “is 6.8%. Forecasts for next year are slightly better than consensus.”
Equita Sim The buy rating and the target price of 16.10 euros are confirmed Mediobanca after the quarterly account “better than expected and of good quality. Solid outlook”.
Akros Bank (neutral, 14.2 euros) speaks of “excellent and in line with expectations” results. (All rights reserved)