MBB SE

XETRA:MBB

Earnings Call Analysis

MBB Achieves Robust Growth with Increased Guidance for 2024

In the first nine months of 2024, MBB's EBITDA surged 88% to EUR 93 million, driven by significant contributions from all segments, particularly Friedrich Vorwerk, which saw a 144% increase to EUR 50 million. Notably, revenues grew by an average of 20% quarter-over-quarter. Friedrich Vorwerk also raised its revenue forecast from EUR 410 million to a range of EUR 430 million to EUR 460 million, with an improved EBITDA margin target of 14-15%. Aumann experienced an EBITDA margin of 11% and is likely to reach the upper end of its profitability forecast, despite current soft e-mobility orders. Overall, MBB aims for a revenue target of EUR 1 billion in 2024 with a 12% EBITDA margin.

Impressive EBITDA Growth

In the first nine months of 2024, MBB Group saw substantial growth in its EBITDA, which surged 88% from €50 million to €93 million. Friedrich Vorwerk led the charge with an EBITDA growth of 144% to €50 million, while Aumann grew by 83% to €26 million. This reflects a significant rebound resulting from contributions across all three business segments: Service and Infrastructure (Friedrich Vorwerk), Technological Applications (Aumann), and Consumer Goods (Hanke Tissue). Notably, the group's EBITDA increase exceeded the total EBITDA from just a few years prior, demonstrating robust operational improvements.

Diverse Segment Performances

The growth was well-distributed across MBB's segments. The Service and Infrastructure segment contributed over €29 million to the EBITDA boost, driven primarily by Friedrich Vorwerk's expansion into energy infrastructure. The Technological Applications segment, led by Aumann, added €9 million, focused on automation solutions primarily for e-mobility. Lastly, the Consumer Goods segment added almost €6 million, driven by Hanke Tissue. Overall, MBB achieved an average revenue growth rate of 20% and an average EBITDA growth rate of 28% quarter-over-quarter in 2024.

Friedrich Vorwerk's Strategic Position

Friedrich Vorwerk is capitalizing on Germany's energy transition, achieving a 23% revenue growth and an impressive EBITDA margin of 17% in Q3. Furthermore, it reported a record order backlog of €1.2 billion, supported by new infrastructure projects for electricity distribution and gas and hydrogen expansion. Following this success, Vorwerk adjusted its revenue forecast to between €430 million and €460 million, with an increased EBITDA margin forecast from 14-15% for 2024, up from the previous 11-13%.

Technological Applications and Aumann's Future Outlook

Aumann's revenues for the first nine months reached €233 million, representing a 17% increase, with an EBITDA margin of 11%. While the company faces delays in e-mobility orders, the ongoing transition to electric vehicles reveals potential for significant order growth once European automotive OEMs stabilize their production strategies. Additionally, Aumann plans to leverage opportunities in non-automotive sectors, such as aerospace and life sciences, diversifying its revenue activities.

DTS Projecting Cybersecurity Demand Growth

DTS experienced a challenging third quarter due to order shifts but remains bullish for future growth driven by escalating demand for cybersecurity solutions. EU regulations mandating improved cybersecurity measures are expected to lead to increased demand for DTS services. Thus, despite a weaker Q3, the outlook remains optimistic, supported by a structural growth trend in the cybersecurity industry.

Consumer Goods Segment Challenges and Recovery

The Consumer Goods segment encountered mixed developments. Hanke Tissue showed a stable EBITDA margin while revenue growth was moderate. Conversely, Delignit struggled with lower than expected demand from automotive OEMs, particularly in the caravan market. Despite these challenges, signs of recovery are anticipated in Q4, following an overall positive demand outlook for their ecological system solutions. For the first nine months, the Consumer Goods segment generated revenues of €70 million with an EBITDA margin of 8%.

Financial Strength and Future Prospects

MBB's financial position remains robust, holding €481 million in cash with €418 million being net cash. Over the first nine months of 2024, MBB invested €55 million in share buybacks, including €11 million in Vorwerk and €6 million in Aumann. Furthermore, the total market capitalization of MBB is positioned below the sum of its parts valuation, with shares in publicly listed companies worth over €350 million, leading to speculation of future acquisition strategies and potential growth opportunities.

Guidance and Investor Takeaway

MBB Group's revenue forecast for 2024 remains set at €1 billion, a noteworthy milestone for the company. The EBITDA margin forecast has also been raised from earlier estimates, now aiming for 12% with an expected EBITDA of €120 million. Given the performance trends and strong balance sheet, MBB is taking strategic steps to capitalize on growth across its subsidiaries and underscore its long-term investment potential.

Earnings Call Transcript 2024-Q3

[Operator]

[Audio Gap] After the presentation, we will move over to our Q&A session where you have the opportunity to ask your questions directly to him if you may have.

So having said this, Constantine, I hand over to you.

[Constantin Mang, executive]

Thank you and good afternoon. My name is Constantin Mang. I'm CEO of MBB and I'm looking forward to presenting our Q3 figures to you today. As always, I'd like to start with a very quick recap on what makes MBB special.

As you know, MBB offers long-term succession solutions to sustainable Mittelstand companies. And the way we do that is pretty unique because first of all, we are a family business. And that means we share the same DNA with the businesses that we want to acquire.

Secondly, we have hands of the capital markets. That's why we are here today, and that's why 3 of our subsidiaries are also stock listed. Friedrich Vorwerk and Aumann just had their earnings call with Montega by the way. And maybe some of you here today have already joined one of these or maybe both calls earlier. And we really like this transparency that you have, not only of MBB itself, but also of our subsidiaries.

Then we have a long-term focus. That means when we buy a company, we don't intend to sell the company, but we really want to develop and grow the company in the long term. And lastly, we focus on sustainable businesses because we believe that sustainability is one of the greatest growth trends of the next decades.

And with that short introduction, let's talk about our first 9 months of 2024. In our last earnings call for the second quarter of 2024, we saw already a profitability record. And honestly, I didn't expect that these growth figures could be beaten once again in the third quarter. And yet Friedrich Vorwerk and Aumann managed to do just that.

As you see here on the slide, Friedrich Vorwerk grew its EBITDA by 144% to EUR 50 million in the first 9 months of 2024. Aumann grew its EBITDA by 83% to EUR 26 million. And that means that MBB as a group actually grew its EBITDA by 88% from EUR 50 million to EUR 93 million. So this increase, this absolute increase of EBITDA in the MBB group is larger than EUR 40 million. And that means that the increase is actually larger than our total EBITDA was just a few years ago. So quite an impressive development.

Where is that coming from? Well, actually it's coming from all 3 of our 3 segments. The Service and Infrastructure segment contributed more than EUR 29 million to this increase in EBITDA. And the driver here was clearly Friedrich Vorwerk. We will talk about that a bit more later on. The Technological Applications segment grew its EBITDA by EUR 9 million, and the driver in that segment was clearly Aumann. And last but not least, the Consumer Goods segment grew its EBITDA by almost EUR 6 million. And here, the driver was Hanke Tissue.

Now what's nice about this development is not only that it is actually driven by all 3 segments, but also that the growth accelerated over the year. So if you take a look at the quarter-to-quarter development from the first to the second to the third quarter of 2024, we see that revenues actually grew by an average of 20%. EBITDA grew by an average of 28% from quarter-to-quarter just in 2024. So this is quite an impressive development. And to understand a little bit where this is coming from, I would suggest we jump right into our subsidiaries.

And we start, of course, with Friedrich Vorwerk. As you know, Friedrich Vorwerk provides energy infrastructure that is needed for the energy transition. And Friedrich Vorwerk has seen a lot of growth, 23% in the first 9 months, but especially a sharp increase in its profitability. In the third quarter, EBITDA margin actually reached 17%. 17%, that's quite a figure. And at the same time, order backlog reached a record level of EUR 1.2 billion.

And that's driven on the one hand, by all the new power lines that are being built in Germany in order to distribute the wind electricity generated in north to the south, but it is also driven by gas and hydrogen infrastructure that needs to be expanded in Germany. And for the last few months, when Friedrich Vorwerk won new orders in the electricity field, people were saying, well, the electricity is growing, but obviously the gas sector has no future or something. That is not true.

And today, Friedrich Vorwerk published their latest order, which is actually a large gas order. Why does the gas infrastructure need to be expanded? Well, we've built these LNG terminals in the north of Germany and the gas and hopefully, one day, the hydrogen that arrives at these LNG terminals needs to be distributed within Germany. So the investments that are needed in this gas infrastructure will actually continue for quite a while. And after that, we need to build hydrogen infrastructure in Germany.

So yes, electricity is probably the growth star at Friedrich Vorwerk at the moment, but also gas and finally also hydrogen has quite an impressive development as well. And for that reason, Vorwerk has increased its forecast, its revenue forecast from previously EUR 410 million to EUR 430 million to EUR 460 million, and it has increased its EBITDA margin forecast from 11% to 13% previously to now 14% to 15% EBITDA margin for the full year of 2024.

So I think that the development of Friedrich Vorwerk is pretty impressive. And from all what we know, it's going to continue not only in the fourth quarter, but also next year.

And with that, let's talk about DTS, on the right side. DTS had a very strong first half of 2024. And in the third quarter, it saw a few orders being shifted from the third to the fourth quarter. So actually, revenues were a bit softer in the third quarter, but we believe that these will catch up in the fourth quarter since it was mainly shifts from quarter-to-quarter.

And one of the reason why I believe that DTS is going to grow in the next quarters quite a bit is because there's a strong regulatory push actually in the EU to invest in cyber security. The EU has recognized that many European companies and institutions like hospitals are not very well protected against cyber attacks, and it now requires them to actually invest into cyber security. And DTS, as the cyber security specialist, will definitely benefit from these investments.

And at the same time, DTS is permanently increasing the share of own software that it produces and sells, and that again drives the margin. So a softer Q3, but overall we are very bullish on the development of DTS.

Now let's come to our second segment, the Technological Applications segment. And here we have Aumann on the left side and Delignit on the right side. So Aumann is doing automation solutions, primarily for e-mobility, but also for many other applications. And in 2024, Aumann saw a strong increase, both in revenues and in EBITDA.

If we are looking at the first 9 months, the company had revenues of EUR 233 million, which is an increase of 17% actually. And EBITDA margin reached 11%, which has led the company to actually increase its forecast or make it more precise, namely that they will reach the upper end of their original profitability forecast.

What we are seeing at the same time is a temporary delay of e-mobility orders by European OEMs. And I think that European automotive OEMs currently need to figure out what their new base level is. It is clear that they are not going to sell as many cars as they did in the past. But many other things are unclear. For example, what happens in the U.S.? What happens in China? And how does the European Union continue to regulate the European OEMs with regards to CO2? It's also possible that Germany will launch some sort of subsidy in order to create a demand stimulus.

And what I think is happening right now is that the OEMs need to figure out what to make of that. And this process is still ongoing. But I believe that once the OEMs have a clearer picture of what the situation actually is and what demand they can plan with, I believe the investments into especially e-mobility will continue. The OEMs must launch new electric car models because that's the only way to go forward, and that's the only way to compete especially in China, but also in Europe.

And the moment this happens, when the launches of these e-mobility models are set, then Aumann will definitely see a strong pickup in orders again. But what we are seeing at the moment is a pretty soft order intake. And that's also one of the reasons why Aumann has decided that going forward, they want to focus not only on the e-mobility industry, but also in other areas because there's a lot going on. Actually, if you look at what rising labor costs do, what artificial intelligence and the newest developments in the area of robotics do is they create great demand for automation solutions in industries that have not been as highly automated as the automotive industry.

And Aumann has always served these industries a little bit opportunistically. But what they are doing now is putting really a strategic focus on these areas such as aerospace or the life science industries. And I think there's a lot of potential and Aumann going forward will bundle these opportunities in their next automation segment.

Let's talk a little bit about Delignit here on the right side. Delignit had a pretty tough 2024, and that's because the demand from automotive OEMs was much lower than expected. Especially the Caravan business was pretty weak in the first half, and in the third quarter, it still hasn't picked up as much as we had expected.

Right now, it seems that in the last few months of 2024, we will actually see this pickup, but the Q3 was still pretty soft. And it will now take a little for Delignit to catch up what they were not able to deliver in the last, yes, let's say, 6 to 9 months.

That's why we see a decline in revenues to EUR 50 million in the first 9 months. And of course, also a corresponding decline in the profitability. The outlook, however, is much more positive. So we don't see any structural problem here. The demand for the ecological system solutions offered by Delignit remains to be strong.

Last but not least, let's talk about our Consumer Goods segment with our subsidiaries tissue, Hanke Tissue and CT Formpolster. Both companies had both good and not so good development. If you look at Hanke Tissue, we saw a strong increase in the EBITDA margin. At the same time, revenue growth was relatively moderate.

CT Formpolster had pretty low demand from the furniture market for their mattresses, which also affected EBITDA. Nevertheless, we see that the order momentum has rebound in Q3, and we are seeing a little rally that now for the last few months of the year. Overall, the segment is doing pretty well with EUR 70 million in revenues for the first 9 months and an EBITDA margin of 8%.

So if we are taking all of these segments and companies together, we end up with a revenue increase of the whole group of 11% to EUR 765 million in the first 9 months and an increase in EBITDA margin from 7% to 12%. So basically 5 percentage points higher than last year.

And for the third quarter, as I mentioned before, we actually see higher growth figures, both in terms of revenue, but especially in terms of EBITDA. EBITDA margin actually reached almost 13% in the third quarter. So we see this nice increase over the course of the year, and that has also led us to increase our forecast and our revenue forecast remains at EUR 1 billion for the very first time in our history.

But in terms of EBITDA margin, we -- originally we forecasted a 10% EBITDA margin. Then we increased that forecast to more than 10%. And now we just raised it again to 12% EBITDA margin. That would mean at EUR 1 billion revenues that we have an EBITDA of EUR 120 million.

In light of this development, we invested a lot into shares of MBB Group companies. In the first 9 months of 2024 alone, that's here on the right, you see that we bought MBB shares worth EUR 38 million. We bought Vorwerk shares of EUR 11 million and Aumann had its own share buyback worth EUR 6 million this year alone. So in total, the group spent EUR 55 million in its own shares.

And despite this high investment, if you are taking a look at our balance sheet, specifically at our assets, you see that we actually added EUR 26 million in net cash from end of September 2023 to end of September 2024. We have a total of EUR 481 million in cash, out of which EUR 418 million are net cash. And out of that, around EUR 208 million -- EUR 281 million, sorry, are attributable to the holding MBB SE.

Now if you look at our sum of the parts valuation, you see that our share in the publicly listed companies, Vorwerk, Aumann and Delignit, is worth a bit over EUR 350 million. We have EUR 281 million cash -- net cash in the holding. And if you add that, you're already way beyond our market cap. And this attractive valuation, together with our strong balance sheet, led us to launch a new share buyback program, which has a volume of up to EUR 15 million, and it will start tomorrow.

And with that, I would like to end my presentation, and I'm kind of looking forward to your questions. Thank you very much.

[Operator]

Thank you, Constantin, for the dive into the results and for the presentation. So we will now move over to the Q&A session. [Operator Instructions] So with that, let me have a quick look.

So we have first question from [ Amit ]. So Amit, you should be able to speak now.

[Unknown Analyst]

My question was regarding Aumann. What I understand is that we have a very unique technology, direct hairpin technology. I was wondering whether we could sell this to companies like Tesla, who has its own automation arm, I know. But can we sell these automation equipment to these players who are leading the EV revolution?

[Constantin Mang, executive]

Yes. Well, it's not one technology. It's actually quite a lot of different technologies. Let's say, when Aumann identified the e-mobility market as their strategic focus, they started indeed with winding technology, which is needed to produce electric motors. So that was, if you want, the start into the e-mobility market.

But then over the last years, Aumann has developed many key technologies that are actually needed to produce battery systems, battery modules, but also battery packs and through an acquisition last year, actually also coating technologies that are needed for parts of the battery cell. So step by step, they have really, I would say, cleared all key technologies for producing batteries and battery packs and battery modules.

And then thirdly, they also developed everything related to the inverter, which also every electric car needed. And now I would say with the winding technologies for motor production with the technologies needed for the batteries and inverter technologies, they basically cleared the whole technology set needed to produce the key components of an electric drive train. And that has led them actually to this question: what's next, right? And that's how this next automation segment has developed to answer the question what's next?

I don't think it's very wise to sell any of these technologies. In the end, it always depends on the price, of course. But many of these technologies can be transferred to other applications as well, right? You need winding technologies to produce electric motors in cars. But actually, Aumann even today is using the same technologies to produce electric pumps for all kinds of applications or, let's say, motors for e-bikes.

So it's not like a product that Aumann is selling, they have technologies that can be applied to many products. And therefore, I don't think it's the best idea to sell any specific of these technologies. Nevertheless, I think we are opportunistic enough to listen when anyone really wants to buy anything of us.

[Unknown Analyst]

Yes. So I was wondering whether we could sell them our automation equipment, like our over dependency on, I would say, traditional carmakers is quite high, especially in the Germany. So the question actually is, how do we diversify with, first, the leaders, and the second, geographically? For example, you have a team in China as well in the U.S., but the international sales is just 10%. So…

[Constantin Mang, executive]

But why -- okay, then I didn't quite understand your question correctly. But since you mentioned Tesla, I mean, why do you think Aumann is not already selling equipment to any of them?

[Unknown Analyst]

Yes, that was a question actually. So I was -- because what I understood, this direct pin technology, Aumann mastered it very well, and it's giving huge benefits to the motor. So why would -- I know Tesla bought a company similar to Aumann. So maybe they are doing in-house. Or are we already supplying the subsystems, automation systems to them as well?

[Constantin Mang, executive]

I mean, I'm sure you can imagine that neither the colleagues at Aumann, nor I can comment of which technologies are sold to which company. But I would assume that Aumann is talking to all major players in that field.

[Unknown Analyst]

The second question is on the services front. In the IPO, we had assumed that we will probably increase the services component. I guess the services component then acts as a base when these downturns come to cover your cost. So are you happy with the progress of the services component of the business?

[Constantin Mang, executive]

Yes. And I think exactly what you are saying is happening, right? There's service and maintenance businesses that, of course, becomes more important when revenues don't grow as much. While when revenues grow, typically the service business doesn't grow as quickly because it's more a continuous business. But, yes, when the growth is not as high, it's becoming more important relatively speaking. So I think that's definitely happening.

[Operator]

By now, we have further questions. But if you have time at the end, we will come back to you. So by now, let's move on with the questions from Ralf Marinoni.

[Ralf Marinoni, analyst]

Yes, Ralf Marinoni with Quirin PrivatBank. Dr. Mang, you increased your EBITDA margin guidance to 12% looking into 2025 and beyond. Do you feel more comfortable with a 10% margin or 12%?

[Constantin Mang, executive]

I guess it's a trick question to get some kind of forecast for 2025. Let's put it that way. I would be surprised if we see a decline in the EBITDA margin anytime soon. There's no trigger for me to believe that. That being said, unfortunately I cannot make the forecast now for next year, especially not in this call, because we haven't done it and we haven't published it yet. So I wouldn't think it's very plausible that EBITDA margin goes down, but I cannot tell you a number just yet.

[Operator]

So we will move over to the questions from [indiscernible].

[Unknown Analyst]

Constantin, thanks for another good quarter, it seems, even though the share price doesn't necessarily agree with you. Has your conviction on spending the total cash amount on acquisitions changed? Has it increased? A couple of quarters ago, you mentioned that you still had a conviction that you would be able to spend the complete amount on new acquisitions, new platform companies? Or is a special dividend maybe becoming more likely at this point?

[Constantin Mang, executive]

Again, a trick question, I guess. No, I think we haven't seen a big change in terms of M&A sentiment over the -- or let's say, from the last earnings call to now. If I compare it from last year to now, we have seen an improvement because prices are more attractive. From the last earnings call to now, I would say it's equally likely that we are coming to also a larger acquisition anytime soon.

So we are seeing interesting targets. We are seeing them at prices that we like much better than what we saw last year or 2 years ago. Nevertheless, we haven't bought anything just yet as you are aware. Does that have any immediate implications on the dividend? I don't think so. But just as I'm not able to give any revenue for -- margin forecast for next year, I also cannot give a dividend forecast for next year just yet. But I don't see the M&A sentiment at the moment having a big impact on that decision.

[Unknown Analyst]

Okay. Maybe another question regarding DTS. Is it safe to assume historic growth levels are going to be resumed in '25? Or do you see an acceleration materializing due to the mentioned EU regulations?

[Constantin Mang, executive]

Yes, yes, sorry.

[Unknown Analyst]

No. And then maybe also a bit of more information on the margins of the revenue that's related to these kind of orders perhaps.

[Constantin Mang, executive]

Of DTS?

[Unknown Analyst]

Yes, the margin profile on these especially software-related orders, I would say.

[Constantin Mang, executive]

Yes. Okay. So I mean, first of all, the growth rates, you're talking about historic growth rates. You just have to look one quarter back, right? In the second quarter, DTS still grew 16%, 17% or something like that. So it's not that historic. It's just that in Q3, the company didn't grow. And of course, I expect us to continue to a growth path.

As I said, there were a few extraordinary effects, namely order shifts from the third to the fourth quarter. And that's why the third quarter didn't grow. And talking about next year, of course, I mean there's no structural reason why demand in the cyber security market should slow down. Quite the opposite. I think there was a report just was it this week or last week about the amount and magnitude of cyber attacks in Germany. And they are on a record high. Never before have there been so many cyber attacks on German companies than today. And the same is probably true for all other European countries.

And therefore, I think the demand will not decrease. Of course, there's always a little bit of up and down from quarter-to-quarter, maybe also from year-to-year, but there is a structural growth in this market and DTS will definitely benefit from that.

[Unknown Analyst]

I was talking more about maybe an acceleration due to these demands, especially because it's now becoming more and more in the news, indeed, as you mentioned, that cyber is really becoming a big theme. So…

[Constantin Mang, executive]

No, I understand what -- you need an -- you meant an acceleration of the growth rate.

[Unknown Analyst]

Yes, exactly.

[Constantin Mang, executive]

Sorry, yes, then I misunderstood you. Sure. I think structurally, DTS should grow every year a bit more because the demand also accelerates. And yes, definitely, I agree.

[Unknown Analyst]

Maybe final question from my side. More of a theoretical one, if you will. There's a lot of research on holding companies and their discounts. Why do you think that the market isn't valuing MBB and the opportunity set that you have at the moment, given all the structural trends that your companies are massively benefiting from?

[Constantin Mang, executive]

Yes, that's a very good question. And to be honest, I'm glad I'm not a researcher in this field because I find it a very frustrating field to research, I think. I mean, just look at the stock of Friedrich Vorwerk, which was at the beginning of the year, maybe at EUR 14 or something. Now we are at EUR 27. So a plus of 80% and MBB owns 50% of that stock. And now look at how much of this increase in value has translated into the MBB share. It's difficult to explain. And it's difficult to explain why holding discounts expand. I don't have a very good explanation for it, to be very honest with you. I understand why there's a discount, and there will always be a discount, but the magnitude and the dynamics of this discount are mystery to me.

[Operator]

Thank you so much for your questions. Just to give you a short update, by now we have 2 open questions in the chat box. So please still feel invited to ask questions if you may have.

The first question is again on the EBITDA. To what figure do you see the EBITDA margin evolving at Vorwerk over the upcoming years?

[Constantin Mang, executive]

I think it's also -- this might be the third trick question I'm getting. I cannot make a margin forecast, especially not for Vorwerk, as they are stock listed themselves. In Q3, we saw 17%. That's, I think, quite a remarkable figure. Over the year, like if you look at the seasonality, it would be great if Vorwerk was able to keep this profitability that it has shown in the third quarter now, but over the full year, including the weaker winter months. But I, by no means, want to give any margin forecast here for Friedrich Vorwerk.

[Operator]

Thank you so much. And now the last question from [ Gidor ]. How do you invest your cash position of EUR 281 million?

[Constantin Mang, executive]

Yes. So we have part of it as cash, cash. We have part of it in stocks and half of it -- and part of it in bonds, mainly government bonds. And very roughly speaking, the shares are 1/3, 1/3, 1/3, but it shifts and changes a lot, obviously.

[Operator]

All right. Thank you so much. So it seems no further questions, especially no further tricky questions, are open. So Amit, if you have still a question, now it's the opportunity so that we come back to you.

[Unknown Analyst]

I'm just trying to understand. I'm a new shareholder. So I think on the acquisition front, the -- how do you look at acquisitions in the subsidiaries versus -- or I would say, would you look into acquiring something for DTS more or on the Aumann side? How do you decide? Obviously, it depends upon the deal inflow. How do you decide in capital allocation where to invest?

[Constantin Mang, executive]

Yes. So I mean…

[Unknown Analyst]

In M&A basically.

[Constantin Mang, executive]

Generally, we are in a lucky position that our subsidiaries also have pretty strong balance sheets. I mean you mentioned Aumann. Aumann has more than EUR 100 million in net cash. So of course, Aumann is looking into M&A, but their M&A is not in competition with any M&A on the holding level or of DTS, let's say. So the allocation is, yes, for -- I would say, both for Aumann, for DTS, but also for Vorwerk, M&A can be very interesting.

And then it depends a lot on the target, on the opportunity. And the same holds for M&A on the holding level. There's no general decision that any M&A in one direction or in one subsidiary is better than M&A in another. It depends a lot on the opportunities. If we have a great opportunity for an attractive acquisition at Aumann and DTS at the same time, I think we would find a way to do them both at the same time.

[Unknown Analyst]

So on the M&A front, you're still seeing the prices high?

[Constantin Mang, executive]

Lower than last year and clearly lower than 2 years ago. So I would say we don't have any regrets that we didn't buy anything last year or the year before. And this year, they have been coming down. I mean, I don't have much like sort of quantitative evidence for that. But like qualitatively speaking, they've been coming down in the, let's say, first half. And now they're pretty stable, I would say. But yes, compared to last year, definitely more attractive.

[Operator]

So in the meantime, we have received one last question from Andreas. Can you elaborate on the securities you invest in?

[Constantin Mang, executive]

Yes. I mean we never give out names because otherwise we could probably spend the full 45 minutes of these earnings calls in each and every of the name. But generally speaking, we overweight U.S. stocks, and we have mainly blue chip stocks in our stock portfolio. So nothing very exotic, nothing that would shock you if you saw Microsoft and Alphabet or so on the top. That just reflects the fact that these are also the biggest titles in the S&P 500.

[Operator]

Thank you so much. I guess after 45 minutes, we are on point. So no further questions. This means we come to the end of today's earnings call. And thank you, everyone, for joining and to show an interest in MBB. And also a big thank you to you, Constantin, for your time and the dive into the company and for answering all those questions.

I wish you a lovely remaining week. Stay safe and healthy due to the cold season. And Constantin, the last sentence belongs to you.

[Constantin Mang, executive]

Well, thank you very much for joining this call. We are just in time, so I don't want to now ruin it and overrun. Have a great day, a good rest of the week, and I'm looking forward to see you next time.