Report of the Advisory Board:

Continuing the E/D/E success story

Hans-Jürgen Adorf - Chairman of the Advisory Board

Roughly one year ago, the Advisory Board Chair’s report ended with a gloomy outlook for 2022, triggered by Russia’s brutal invasion of Ukraine. Things have turned out much worse than we could have imagined at the time – first and foremost for the people of Ukraine. Even now, there is no end in sight for this tragedy. Against this background, the economic impact of this war on Germany and other European countries – while a major challenge and burden – can undoubtedly be managed and coped with.

The mass economic slump that was once so feared has failed to materialise, at least in 2022. The compulsion for change, for flexibility and creativity as a result of the effects of war and the tangible necessities of climate change also harbour opportunities for a stable, secure and successful future in all democratically structured societies. Demanding challenges at all levels and in all areas must be both accepted and mastered.

The key business results for 2022 document the continuation of the E/D/E success story.
– Growth in trading volume by around EUR 2.1 billion to a total of EUR 9.68 billion, of which: growth in classic goods business by EUR 314 million to EUR 7.7 billion, growth in service business ETRIS BANK by EUR 1.7 billion to around EUR 2 billion
– Cash flow EUR 32.7 million
– Consolidated net income EUR 21.7 million
– Equity EUR 456 million
– Disbursement to members EUR 188 million

Fortunately, since the middle of 2022, the Advisory Board has again been able to hold its meetings face-to-face at the E/D/E headquarters. All other Advisory Board meetings were held on schedule as virtual meetings. The Advisory Board was always fully represented and quorate.

The Advisory Board was always informed in detail about the Group’s economic development, risk potential and market development in a very timely manner in the form of quarterly reports and meeting documents. Particular attention was paid to the payment behaviour of its members, the current liquidity situation and the development of income and costs. Investments and projects were another focus of the consultations. The expansion of financial services of the ETRIS BANK – and the associated increase in staff – were analysed intensivelyand confirmed in several Advisory Board meetings. There were no extraordinary risk events, negative budget deviations or other events beyond the usual scope in the past year. The Advisory Board reviewed the expected annual results in detail in December.

During the same meeting, the submitted budget plan for 2023 was analysed, discussed intensively and approved by the Advisory Board. In view of the tremendous uncertainty concerning further economic development – especially with regard to the sectoral development relevant to E/D/E – the Advisory Board expressly welcomes the fact that the Management Board has identified several scenarios, and possesses a flexible catalogue of measures available in the event of a negative deviation from the approved budget. The Advisory Board considers the approved budget variant with a trading volume in excess of EUR 10 billion for the first time (plus approx. 5 percent) and a cash flow of more than EUR 30 million, as well as a renewed increase in equity to about EUR 480 million, to be both highly ambitious and demanding. The foundations for achieving these goals have been laid. The Advisory Board is confident that the members will be able to maintain a stable market position in 2023.

On this basis, the Advisory Board expects that the Management Board’s goals can be achieved with great commitment from all teams. The prerequisite for this is that we do not have to deal with any further geopolitical surprises. Further information can be found in the detailed management report.