2.4 Position of the Company

Earnings of United Internet AG

As a pure holding company, the earnings position of United Internet AG is usually dominated by its investment and financial result. In the fiscal year 2021, sales of the parent company amounted to € 0.5 million (prior year: € 0.6 million) and result mainly from services rendered to the Group’s subsidiaries.

Other operating income amounted to € 12.6 million (prior year: € 12.3 million) and mainly results from income from the disposal of financial assets amounting to € 8.8 million, relating in particular to the sale of MIP Multimedia Internet Park GmbH.

Adjusted for effects from employee stock ownership programs, personnel expenses amounted to € 1.1 million (prior year: € 1.0 million).

Other operating expenses amounted to € 12.4 million (prior year: € 19.8 million) and mostly comprise expensesrelating to internal charges for services rendered to Group companies of € 5.2 million, as well as legal, auditing and consulting fees of € 3.6 million.

Income from profit transfer agreements of € 317.5 million (prior year: € 87.2 million) resulted from profit transfers of 1&1 Mail & Media Applications SE amounting to € 314.7 million, United Internet Corporate Services GmbH amounting to € 2.7 million, and United Internet Service SE amounting to € 0.2 million. The profit transfer of 1&1 Mail & Media Applications SE includes one-off effects of € 77.1 million from the sale of an investment within the Group and € 140.0 million from a capital reduction and subsequent special dividend of a subsidiary.

Income from investments amounted to € 6.7 million (prior year: € 6.7 million) and mainly comprises the dividend of 1&1 AG.

Expenses for loss assumptions of € 0.6 million (prior year: € 0.1 million) mainly relate to the compensation expense of United Internet Investments Holding SE, United Internet Management Holding SE, and United Internet Corporate Holding SE.

The parent company’s result before taxes amounted to € 403.5 million (prior year: € 167.9 million).

Income taxes of € 54.1 million (prior year: € 57.2 million) comprise current taxes of € 56.1 million for 2021 (of which € 28.2 million corporation tax and the solidarity surcharge, and € 27.9 million trade tax), as well as € 3.0 million from previous years. In addition, deferred taxes liabilities of € 2.0 million were formed. The release of tax accruals amounting to € 7.1 million had an opposing effect.

Net income in the separate financial statements of United Internet AG for the fiscal year 2021 amounted to € 349.4 million (prior year: € 110.6 million).

Assets and financial position of United Internet AG

The parent company’s balance sheet total rose from € 5,618.2 million as of December 31, 2020 to € 6,445.3 million on December 31, 2021.

Non-current assets of the parent company amounting to € 5,636.9 million (prior year: € 5,331.0 million) were dominated by financial assets. Due to the increased shareholdings in subsidiaries IONOS TopCo SE and 1&1 AG, shares in affiliated companies increased to € 4,221.9 million (prior year: € 3,763.4 million). Loans to affiliated companies declined to € 1,415.0 million (prior year: € 1,567.6 million) due to the redemption of loans within the Group.

Current assets of the parent company amounting to € 808.4 million (prior year: € 287.2 million) comprise receivables due from affiliated companies and other assets. The receivables due from affiliated companies rose to € 725.9 million (prior year: € 234.9 million). These mainly comprise receivables within the United Internet Group’s internal cash management system as well as from profit transfer agreements and services received within the United Internet Group. Other assets amounting to € 33.8 million (prior year: € 36.3 million) consist mainly of receivables due from the tax office relating to audits of previous years.

Shareholders’ equity of the parent company amounted to € 3,594.3 million as of December 31, 2021 (prior year: € 3,357.3 million). The increase in equity during the reporting period is mainly due to net income of € 349.4 million, with an opposing effect from the dividend payout of € 93.6 million and the buyback of treasury shares of € 18.2 million, which are subtracted from equity. The equity ratio fell from 59.8% in the previous year to 55.8% as of December 31, 2021.

The parent company’s accruals of € 9.7 million (prior year: € 97.6 million) mainly comprise accrued taxes amounting to € 1.6 million (prior year: € 87.4 million), as well as other accrued liabilities for employee stock ownership plans, legal, auditing and consulting fees, bonuses, and other items totaling € 8.1 million (prior year: € 10.2 million).

The liabilities of the parent company are shaped in particular by liabilities to banks and liabilities due to affiliated companies. Liabilities to banks increased to € 1,825.4 million in the fiscal year 2021 (prior year: € 1,467.9 million). Bank liabilities comprise three promissory note loans totaling € 1,297.5 million, syndicated loans totaling € 250 million, drawings from bilateral credit agreements of € 170 million, drawings from bilateral credit facilities of € 100 million, and interest of € 8 million. Liabilities to affiliated companies rose to € 998.9 million (prior year: € 672.6 million) and mainly comprise liabilities from balances within the United Internet Group’s cash pooling system (€ 989.4 million), from service arrangements (€ 8.4 million), and from profit transfer agreements (€ 0.6 million). Other liabilities of € 4.6 million (prior year: € 12.0 million) are mainly sales tax liabilities.

Cash flow of the parent company’s financial statements is dominated by cash flows from the profit transfer agreements, as well as the dividends of investments. There was an opposing effect under financial activities from the treasury shares purchased in the fiscal year 2021, from the dividend payment, and from the increased shareholdings in subsidiaries IONOS TopCo SE and 1&1 AG.

Management Board’s overall assessment of the current business situation of the parent company

Due to its role as the Group’s holding company, the economic position of United Internet AG at parent company level is mainly influenced by its investment and financial result. The above statements on the Group’s economic position therefore also apply qualitatively for United Internet AG itself.