DBAG report Q3 2014

Deutsche Beteiligungs AG arrived with their third quarter report and it was happy reading. Upon the delivery of the report the market response was non existing and after some news about them maybe giving an extra dividend there was a small jump up. What was then so good in the report?


Here you can find the Q2 2014 report in full from Deutsche Beteiligungs AG on their homepage.
Below is the financial highlight and the result is excellent! Looking at the first nine months we see that they have almost doubled the earnings from around 20 to 40 million compared to 2013! This means that they have already earnings around 2.89 € per share which is the reason for why they are prepared to give an extra dividend. They are also very happy about the sale of Homag to Dürr. Homag has been their pride an joy for the last quarters and they claim to have received a fair price from Dürr. In the other direction, another of DBAGs companies, Broetje-Automation bought the aircraft assembly technology from Dürr and will then, if the cartel authority allows it, become the worlds biggest company for aircraft assembly systems. The equity also jumped up by over 10% which I also like very much.

In the financial statement below there were some things that I find not so entertaining. For instance they are only 48 employees (+3 interns) and it was the same last year for them to get 4 million more in salary compared to 2013 I find too high. That is an increase of almost 43%! 43%! Why I wonder?! An additional thing was they will put aside an additional 6 million to retirement benefits. Ehhh... the salaries are not enough as they are already? Yes, I know that there are tax advantages in Germany so that one can put aside earnings in retirement money for the employees but that money is locked and it should be used to generate more earnings instead of being paid out to retired already overpaid employees in many years from now.

Conclusion: I do not like when management overcompensate themselves and pad themselves too much on the shoulders which I start to get the feeling they are doing this year. Sure, they treat me well as a shareholder also but I would prefer to see a better ROE from these guys! I will remain shareholder in DBAG.

Please see the analysis of Deutsche Beteiligungs Ag (DBAG) 2014 if you want to find out a bit more about DBAG.