Welcome to our Q&A session regarding our Q1 results. My name is Jan Pahl.

I'm Head of IR with Hypoport. And together here, I'm with Ronald Slabke, our CEO.

And we are happy to welcome your questions, receive your questions and answer them. And today, you have the opportunity to type in your questions via the chat function.

So feel free just to raise some bullet points. So you do not have to tie in a lot.

Just a few bullet points, and I'm absolutely sure that I can understand what you mean, what you want to ask, and I will highlight and read this out to Ronald. And if you have, however, any technical issues in typing and then using the chat function, you also free to send me an email and I can also via this way speak and transfer these wordings and questions to Ronald.

So this Q&A session will be recorded, and I will start the record in a few seconds. And I see that the first one is typing.

So right now, in the meantime, I will hand over to you maybe to run for a short introduction. So we will start the record in a few seconds and we are recorded now.

So please.

Yes. Welcome from my side as well to this Q&A session here regarding the Q1 financial results of Hypoport.

We had a very vital discussion here 2 months ago when we released the final numbers for 2025. So looking forward for your areas of interest and to deep dive in our numbers for Q1.

Great. [Operator Instructions] [indiscernible] see that someone is typing.

So we will wait a few seconds for the first question. And as a reminder, bullet points are absolutely fine.

You do not have to type in. We got the first question from investor side.

What percentage of your volume was tied to a large bank who is not longer offering mortgages or reducing their mortgages? I'm sure everyone who is knowing us on the call is aware which bank that is.

But so what percentage of our volume is tied to the large bank is not longer or is reducing their mortgage offering?

Let's say, we can't comment on the performance of individual partners with us. It's simply not possible to disclose this information.

What we can share is that the market share of private banks in Germany over a period of -- here in this comparison 10 years went from 20% roughly to 10%. And so the change in the attractiveness of mortgages for private banks and their allocation of equity changed massively over this period and especially over the time 2023, until now.

So that's -- it's a shift, and it's a massive reduction in transaction volume for private banks in total.

Great. I hope this answers the question.

We got another one in the same topic a little bit, but a little more specific. So because of the downturn on Starpool at least, the key question is at what point does it make sense to restructure or exit the joint venture rather than continuing to the [indiscernible]?

Is there a scenario that, for example, Starpool can become loss-making in 2026?

Let's say, the entity is a pooling business where a number of people is assisting specialized advisers, so mortgage brokers tied to German bank. Deutsche Bank as an entity, tight agents, tight mortgage advisers or they are free, but have a preferred relationship with Deutsche Bank and because of this use Starpool.

In general, with a change in the volume as well the necessary support functions in Starpools are growing or have to be reduced, and we are in a constant process of adjusting this to the necessary volume of support. So this adjustment is regularly done.

So there is no midterm risk that this entity will be loss-making. In the end, it contributes to the overall transaction volume and enables us to address this market.

And actually, when you think about the tight agents as well to exclusively address this market. And because of this, there is -- doesn't make sense to, let's say, shut down or question the existence of this joint venture as long as our partner is doing mortgage business at all.

And I have difficulties to imagine a German retail bank of this size and of this balance sheet to exiting the mortgage business fully. This is difficult to understand how such a retail bank should work long term.

Right. So thanks for this.

I hope this answers the question. However, if not, feel free to reschedule this and bring this up to the top once again.

We got another question. It's a little bit more to the overall market.

So about interest rates in Germany here and how the mortgage volume is progressing in April being in May. So at least how -- a little bit more playing words how is Q2 performing here on mortgage business?

Yes. Let's say, in general, what we can say is that Q1 was volatile because of the interest environment.

So during the short period of -- I can zoom in a little bit -- the short period of January, February with declining interest rates, people hesitated to finalize the application and close the mortgage contract because it gets cheaper while they wait. And in the moment when interest rates were starting to rise and this was linked to the Iran conflict, then lots of applications are closed fast.

So we had a volatile environment with a very strong March, similar to the Q1 2025. So Q2, it's pretty normal that after a period of sharp rising interest rates and fast decisions from the consumer side, then you have a time of, let's say, less active business, a week or 2.

And then everything returns to normal. So I would say from this, what we see for now, yes, it slowed down as expected after March.

And actually, it's well visible on, for instance, [indiscernible] numbers that this happened. But we are more or less back to normal already again.

So with this volatility on the overall macroeconomic environment and interest rates, this is nothing unusual anymore from a market environment. So we -- from my perspective right now, I would say we see a pretty normal second quarter for this year.

Okay. Great.

So I hope this answers the questions -- this question. And we've got another one, which is more a little bit.

Okay. There's a follow-up.

So Q2 2025 was weaker, so weaker as Q1 '25. So do you expect a slight decline in volume from Q1 to Q2?

And next question is, might be Q2 versus Q2 last year be down as well?

So I say, first question is, I would say, easy. We have a seasonal activity in the market.

Q1 is very typically a very strong quarter. So a lot of people over the Christmas season decide to start to look into the idea of homeownership and then execute during the period of February, March.

So it is pretty normal. Plus in the second quarter, we have Easter, we have holiday seasons.

We have a lot of let's say, single days with the holidays. So the number of working days is lower in the second quarter than the first quarter.

So both combined creates usually a slightly weaker second quarter than the first quarter, this over a period of the last 20 years, you can say. So I would expect a Q2, which is below Q1 numbers.

So the comparison with last year, it's more difficult. This is not decided by now how we perform compared to last year.

Last year had the same effect that we had a strong March because of sharp rise in interest rates and then weaker start in the next quarter. This is well documented already.

For now, I don't see that it's -- we know already that we are possibly to predict if it will be similar or not. So if it will close above or below last Q2.

Let's say, what is certain, it's not a dramatic change compared to last year in both directions.

Great. Jack, so I hope this answers the question.

I tried to group it a little bit. It seems we do not have on this high level of macroeconomic and interest rates or so any questions, but there are 2 others which are a little bit more deep dives.

So we're now diving into the appraisal service. So it's about Value AG.

So congrats on reaching the breakeven value. Is the plan to continue running this business at breakeven?

No. The plan is to more and more automate all processes, which are necessary in the valuation process.

And with this generate a lot of automation and value and margin in this business. But this is not something you do in a pretty regulated environment on a, let's say, monthly or quarterly basis.

So there needs to be done work. We expect Value AG to be next year profitable full year.

How profitable we will see when we went through the process of automating the processes during this year, so to which level of productivity we come up until then. And let's say, long term, it's a platform business where there is no human labor needed besides this, what the regulator forces us to.

And there's a lot of potential to bring down the cost of all products, which are necessary during the valuation process for mortgage or as well as homeownership buying process in total.

Right. Very clear.

No other questions on appraisal service on mortgages. So we hope maybe there's another one.

This is more on a group level. Let's jump with a deep dive more into insurance because this is the next one.

So a little bit specific question on the volume, which is validated. So maybe it's the next slide, yes, exactly.

So the validated volume, which is now up by 29%, growing to EUR 2.5 billion in Q1, like we can see here. So does this means that -- so [indiscernible] advising is more likely to use -- can you give us a sense of the revenue model once this policy is validated?

And what does the economic look like for EUR 1 billion of consolidated volume versus migrated volumes. So where is the difference?

So the migrated volume is EUR 5.7 billion here. So what are the economics behind these 2 different numbers?

Yes. Okay.

This is -- let's say, the first, what's the difference between these numbers? We -- let's say, via acquisitions, via winning clients, we have roughly EUR 9 billion of insurance premiums within our systems, which were previously provided often as license-based software solution, so locally in start on-premise and therefore, now close to 10 years, we migrate this to the cloud.

So this migration to the cloud to our centralized SaaS infrastructure creates the first KPI. The EUR 5.7 billion is premium volume, which is from the side of the sales organization brought to our platform.

With the growing numbers of insurance companies, we have interfaces and are able to validate the information provided by the sales side about, let's say, certain contracts. So if we are able to match the information between the sales side information, so contractual number and certain IDs to the insurer side, then we create validated volume because then we are able to sync the information of both world, so the sales side world and the insurer back-end side world.

And we can be certain that all information about the contract is just through valid. And we can highly recommend to use this information to optimize processes up to the advice process for the consumer, this is a fitting insurance policy.

So the EUR 3.2 billion, which are not validated, this are just one-sided information where neither an interface to the insurance company is missing or the specific contract could not be matched to an identifiable contract in the back-end system of the insurance company. So let's say, the pricing model, which we use is volume-based.

And depending on the intensity of the usage of the platform, so how many modules you use around your contractual volume and especially in the area of the validated volume where the, let's say, core value are created, we charge a percentage of the premium volume annually or let's say, actually we charge on a monthly basis, but we agree on an annual transaction fee. And the average is for now 10 basis points.

So actually pretty similar to the mortgage world. This is still low because of the low level of usage of modules in the platform, which we have to as well sell to the clients.

And the more validated volume is there, the more attractiveness -- the more the modules around that's attractive because especially on the validated information, you can automate more and gain more efficiency, while on a not validated data set, you risk to get liabilities in acting on them.

Absolutely. So there's another follow-up at least.

So on this validated volume. So when does it generate a meaningfully different margin profile, a bit fuzzy what this means, but when it's kick off a little bit more.

Yes. you see the dynamic.

So for now, we can, on all levels of this KPI work on it. We can migrate more volume from the sales side.

There are still roughly EUR 3 billion left on SaaS -- non-SaaS solutions out there, so license based, and we can win new partners to migrate to the platform. So changing the top line on the sales side, we are able to -- because of the higher volume within the platform, attract more and more insurance companies to provide interfaces to validate.

There is -- the unfortunately painful process if this validation fails on certain contracts. So sales side and insurer has to manually [indiscernible] to this contract, which should be there, but wasn't found.

But as well, this is ongoing and improves the quality of the data and increases the volume of the verified contract. And let's say, plus, let's say, when something changes in the insurance volume, value of a contract, this is automatically adjusted.

So this 2.5% goes up as well if the premiums for computer -- consumers rises, which usually happens more or less on an inflation level. Yes, we are in a constant process of offering our modules to this and increasing with this the incremental margin that we have.

And let's say, the goal is significantly higher than this 10 basis points, which we see right now. So this is -- on all levels, we are working.

And what is meaningful from the dynamic of the last years, we see that it takes too long without massive changes on both sides. So the sales side and the insurer side to support the platform more to enforce the usage of the platform and the intensity of the usage.

And for this, we are in strategic talks with parties to set Smart Insur as the standard in this industry to bring this to this point. For now, we were not successful to bring the platform to this unquestioned position within the market.

Will this happen? Yes, in some moment, in which year, with the track record which we have by now, I'm not certain for now.

Very clear. So we are leaving the segment insurance platform now more on a group level.

So deep dive into expenses. So our operating expenses were flat versus Q1 last year, so operating expenses like personnel, own work capitalized and so on.

Is this due to seasonality is the question? Or are there other reasons?

No, let's say, in general, we are very focused on keeping our costs under control. We are right now not in a strategic expansion mode, you can say.

We don't add additional platforms. We don't explore new areas outside of our pretty wide portfolio of platforms that serve this industry already.

And there's still a lot of work that needs to be done to bring all of them in a profitability level that meets our expectations. And because of this, let's say, costs are under control.

And I would say there is no -- there are no special events in Q1 last year or Q1 this year, which mislead that we are keeping this control on our cost base.

Correct. So another one on the group level is that this target to doubling our EBITDA gross profit margin until 2029.

So do you include any price increases for Europace to achieve this target, meaning increasing from 1.1 basis points a day to, let's say, 1.4 or so? And if yes, what about this magnitude should we expect?

Yes. So I would say the core drivers of this rising profitability are execution of business models where we for now heavily invest or are in an early stage still of the rollout and don't receive at the full scale of our expectation, the return for our investments, which we made in the last year.

So this is the main part of this. So actually, just finishing the work which was prepared already and getting to the point that we see our effort in our P&L.

Besides this, yes, we expect for a lot of additional functionality integration that we delivered to get the return for the additional value we create for our partners. I would not call this price increase.

It's linked for now to raising the value that we offer them. Best example, we -- just in a couple of 2 weeks ago, so still in April, we released the product, which you know us already Europace as a bundle for mortgage brokers as well within the target group of bank branches.

So bank branches -- banks are able to book the Europace one bundle now as well for their advisers in the branches. And this is linked to a 25% higher transaction fee for the banks for this volume.

So we don't see this as a price increase. We see this as additional value that we develop and provide and to get a fair share from our partners for this.

From a purely financial perspective, P&L perspective, yes, it means more revenue with the same transaction volume. And yes, this is part of our strategy.

We just talked about Value AG. It's a great example for this to improve and expand the features of our platforms and with this, receive a higher revenue per transaction.

Right. I hope this answers the question.

If not, please feel free to come back. We stay at group level, but a little bit more into deep dive into cash flow statement.

So on the cash flow statement in Q1, the noncash income and expenses line is at EUR 5.6 million plus versus minus EUR 0.2 million in Q1 '25. So it's a pretty big swing at least of nearly EUR 6 million in a single quarter.

So what is about this item has also been large and volatile for the full year. Can you explain a little bit what actually is in the line and why it's so large in Q1?

Yes. Okay.

No, these are commission payments, actually often pass-through commissions as well to a certain extent, where we, after a full year is over, receive let's call it, bonus commissions from banks. And if it's for our own sales organization, so [indiscernible] network, most of this stays with us.

Part of this goes to the franchisees. If it's for cooperating partners of Hypoport and our pooling businesses there, most of it goes to our partners.

And depending on when a bank transfers this payment to us and then we forward the payments to the subcontractor, the sub-broker, it creates some volatility in our cash flow statement.

Right. So a follow-up, not from the same investor, but on the topic, it is a follow-up.

Do we expect working capital to be a drag on cash flow in Q2 to Q4 this year like it was last year, at least?

Let's say, in general, we don't expect any drag of working capital besides that when we grow by 10% top line that we usually grow as well by 10% on the working capital because of the flows of commissions and the time lag between receiving and forwarding commissions. So on a quarterly basis, this may vary.

And when you just mentioned last year, the -- so look -- please look on full year. This is pretty helpful, not on certain quarters because as soon as the payment was done in a different quarter, it creates their volatile information.

So in general, no drag from the working capital side. This is really short-term transfers.

Thanks for this. Next 2 questions are on Europace back again.

So can you give us a little bit more examples on how we can increase our revenue per transaction beyond this former known name price increase? And also the next one, which we can maybe a little bit combine is, could you clarify a little bit what is Europace One you just mentioned?

Let's start at the end and then maybe get to the wider perspective. So Europace One is a bundle of features in the Europace system.

It starts at the consumer front end. Within the consumer app, there are certain features enabled when you choose Europace One.

For instance, the chat function to communicate automatically with the consumers. There is a feature that enables you to offer your consumer a monitoring of properties that comes to the market fitting to his needs and his financial abilities so that he is fast informed about something that meets his criterias and is able to act faster than other consumers.

But there as well features within the systems like AI, which is recognizing what kind of documents they are provided by the consumer via the app or the adviser via its user interface and automatic check if it was still open with the bank and set the necessary processes to automatically bring this to the product provider, if necessary. So automated flow of documents, just as an example.

So it's a bunch of such a feature, whole product is online described on -- or the whole bundle is described online on the website of Europace as well. And it's something where we charge advisers a fee of roughly EUR 1,000 per year to use this bundle.

And as I said already, for bank branches, it's bookable for a higher transaction fee. One feature is actually Value AG, automated value model of Value AG.

So to get during the whole process in which information provided and valuation for automated valuation for this property in the application. So this is what is Europace One, and it's a good example for how we for now expect to go forward with additional features in the platform and additional revenues for providing them.

So there will be a Europace Two in some moment, and there will be additional bundles, and we will optimize these bundles in the interest of users and us benefiting from it. So we expect to continue this strategy.

So with every feature that we add with every automation that we provide, every integration that we provide along the value chain to put a small price tag to it or to combine multiple of these features to a bundle and enabling this way to book them all together for discounting, you can say, compared to a single usage.

So there's a follow-up. Okay.

So the price increase you were mentioning with Europace One is really charging the adviser, not the banks. So do you have any additional offering to the bank so that you could lead a better monetization of Europace?

Yes, a variety of features already, nothing that we bundled by now. So for instance, the automated property valuation is a very typical additional feature, which you offer already right now and which you can book.

So let's say, there is, you can say, a growing list of additional functionality or services even that you are able to book as a bank as well to enhance your experience and your speed and your and improve the certainty of your decisions during the process on the platform.

Right. No more questions on Europace or price increase, but there's somewhat typing, we can wait another second.

Yes, on Europace, any updates on the market share on Europace? Or do we expect to outperform the market this year?

Yes. Let's say, we expect to outperform the real homeownership market in Germany here.

We see that we are -- let's say, brokers to take market share, [indiscernible] second I will switch to the slide to give you some visualization. So we expect brokers to take market share and even improve, increase our market share within the broker segment because of, let's say, adjust net positive migration of structures to our platform.

We see as well that in the savings bank industry and in the corporate bank industry, we just have a migration path in a positive way. So we are not losing any partners in both of these groups, and we are not losing any brokers as well.

So the only significant change was the decline of the market share of the private commercial banks here in Germany, especially one big partner of us, where we still serve the whole volume in the standardized private mortgage business, but this was shrinking over a period of the last 3 years now, you can say. So we expect to take market share because of the ongoing dynamic in all 3 sectors.

And to be honest, we expect as well a growing market share of private banks again in Germany and that we expand our market share there.

Very clear. However, is there any follow-up on this fearfully got the same -- a little bit the same topic.

Any updates on InterHub? Do you see them operating that platform to all brokers in the future?

Yes. Just I want to mention one thing here in this call as well.

It was in the German Q&A, and it feels strange to not share as well in English Q&A. Even when the German one was recorded, but it will be difficult for you to [Audio Gap].

It seems we have lost Ronald [indiscernible]

[indiscernible] was the opinion to change my devices, last 2 months ago, he did it. So today, he did as well.

So I just say that we had in during Q&A, a question regarding Targobank. And because it was leaked that they are right now going starting their long announced mortgage initiatives together with their acquired subsidiary OLB, Oldenburgische Landesbank.

And the question in the German Q&A was what impact it may have on Hypoport's Europace transaction volume. And I could just say we can't comment on single partners.

But yes, it's well known in the market that OLB is using Europace to run their business. And -- it is well known in the industry here that Targobank for now 2 years prepared to enter the mortgage market here.

And this was what was leaked now is the cooperation of these 2 entities belonging to the same French banking group as an initial start for Targo to enter the mortgage business. And with this said, I expect a positive outcome for us.

And it's great for the market when another large foreign bank joins the German mortgage market and provide mortgage business, especially when you see how private banks originally, the German private banks declined their volume. So there is a need as well and there is a space for more banks providing mortgages in an efficient way, in an automated way with the right technical infrastructure behind this.

So this -- I think this should be shared here even when nobody is able to ask the question. So the next question was InterHub.

InterHub just a couple of days ago, I didn't announce -- it was as well a league that they reduced the workforce that they are, let's say, I would say, struggle to meet the profit expectations of ING Group and need to restructure. They want to reduce their workforce by more than 10% right now.

As you may be aware, while we operate a franchise system, they have hired advisers in branches, which they typically rented. So they have a different kind of cost base.

And they right now adjust or restructure their business. So part of the question was, do we see that they are more aggressively entering the platform market?

No, we don't see this. Actually, we don't see InterHub for a couple of years now as a competitor on the platform level.

They are still in some old corporations there where they do a similar business, but these corporations are -- I would say, roughly 10 years old, and they are still continued, but they didn't attract new clients on this level, and I don't see them even trying to do this.

Absolutely. This was a little bit more linked to the bank side.

What is about the brokers, the independent brokers because this was also part of the question. So do we see or do we expect to offer their platform to all of his brokers?

In general, they do this as a pooling offering with the [ full ] entity. So the probability is -- and actually, our pool, Starpool, Quality-pool and the last [indiscernible], they an answer to this offering of InterHub.

And you can say today, Starpool [indiscernible] are similar big pooling organization in the German small intermediary broker market. So our incremental gain in market share in the broker segment here over the last 10 years from 50% to 60% is linked to the fact that our pooling organizations using Europace, they are pretty successful in taking over volume from pool.

So I don't see here any shift in the market. The poolers running on Europace have a very competitive offering for small intermediaries.

Great. Thanks for this.

I hope this clarifies question. [Operator Instructions] It seems that no one has any issues in using the chat function because I don't receive any questions here.

Last one, which is more on capital allocation, and maybe this is a good one to handle now. It's great to see that we set up this share buyback program in Q4 and Q1.

How much do we still have authorized? And are we still active at the moment?

So we have an authorization to buyback 10% of our shares with the last authorization. We bought just 1% [indiscernible] still have roughly 9% outstanding.

And on the agenda for this year's Annual General Meeting is again to get approval to buy back 10%. So to renew this -- to have a fresh 10% potential to buyback shares.

And yes, the current share price is attractive for share buybacks.

Yes, right. So we are asking for the next one for another one.

Are we still active? Well, the current or the last share buyback program is closed.

So this is it, EUR 10 million. So are we active?

Obviously, we have some intention on this and ask the AGM for this? So I hope this clarifies the question.

As a reminder, you can type your question in through chat, we still a good audience here. So it seems our Q&A is pretty interesting.

Maybe just explicit ask up until today, thanks to insider regulation, we were conflicted to start a new share buyback program. And if there are any information within the company who locks us as an insider as a company, we can't start a new one.

So that makes it a little bit tricky to find a window of opportunity to start buyback programs in a pretty dynamic environment, let's say.

Thanks for this background information, very important. And a follow-up on this.

Ronald, do you know if your shares are available through your custodians for short sellers. So it seems that your shares [indiscernible] my personal shares.

Yes. No, my [indiscernible] are not available for short sellers.

Okay. There's another one.

What is the theoretical firepower to continue share buybacks? It's a good question, right?

Yes, let's say, it's -- as you can imagine, there are multiple layers of how to finance a share buyback. So it's the ongoing operational cash flow.

It's the opportunities to finance things via loans or via selling as well noncore businesses. So there's a wide variety.

So [indiscernible] is significant, I would say. And the question is what we are able to materialize and, let's say, keep [indiscernible] very healthy risk balance, especially when it comes to long-term loans.

Correct. Any follow-up questions here on share buyback, capital allocation or operating business.

Feel free to type it into the chat. It seems for now there are no more questions, and I don't see any one typing.

So I would like to hand over to you, Ronald, for maybe some last wording to close this Q&A.

I would say thank you for the activity. We had again, Vital Exchange, and this is great.

This is a positive development, I would say, especially in the English Q&A. Happy to continue this in 2 months when we release our half year numbers.

And be certain, we will stay focused on keep growing this company and keep costs under control and bring all what we had in mind to life and monetize it. So thanks for your attention, and see you here in 2 months.

Thank you. Take care and Bye.