Business Context and Reporting Period
This Form 6-K filing by UBS Group AG and UBS AG, dated July 31, 2015, provides supplemental financial data prepared in accordance with International Financial Reporting Standards (IFRS). The filing focuses on capitalization and earnings coverage ratios for the quarter ended June 30, 2015, and the fiscal year ended December 31, 2014. It references the company's annual report on Form 20-F and quarterly reports filed in May and July 2015.
Key Financial Metrics
Capitalization (as of June 30, 2015)
| Item | CHF (Million) | USD (Million) |
|---|---|---|
| Short-term debt issued | 60,580 | 64,776 |
| Long-term debt issued | 96,557 | 103,245 |
| Total debt issued | 157,137 | 168,021 |
| Equity attributable to UBS AG shareholders | 51,685 | 55,265 |
| Equity attributable to preferred note holders | 1,840 | 1,967 |
| Equity attributable to non-controlling interests | 38 | 41 |
| Total capitalization | 210,699 | 225,293 |
Earnings and Fixed Charges
For the quarter ended June 30, 2015:
- Pre-tax earnings from continuing operations: CHF 1,700 million
- Total fixed charges: CHF 2,063 million (Interest expense: CHF 1,918 million; Other: CHF 145 million)
- Ratio of earnings to fixed charges: 1.82
For the year ended December 31, 2014:
- Pre-tax earnings from continuing operations: CHF 2,424 million
- Total fixed charges: CHF 7,293 million
- Ratio of earnings to fixed charges: 1.33
Material Changes Versus Prior Period
Comparing the quarter ended June 30, 2015, to the quarter ended March 31, 2015:
- Total Debt Issued: Increased from CHF 148,714 million to CHF 157,137 million.
- Shareholder Equity: Decreased from CHF 53,815 million to CHF 51,685 million.
- Total Capitalization: Increased from CHF 204,456 million to CHF 210,699 million.
Comparing the quarter ended June 30, 2015, to the full year ended December 31, 2014:
- Earnings Coverage: The ratio of earnings to fixed charges improved to 1.82 in Q2 2015 from 1.33 for the full year 2014.
Guidance, Outlook, and Risks
The filing does not contain specific forward-looking guidance, management commentary on future outlook, or detailed risk factors beyond the standard incorporation by reference to other registration statements. The document notes that no mandatory preferred share dividends were paid in the periods indicated. The filing incorporates by reference various registration statements (Forms F-3, S-8, F-4) and prospectuses, including those related to Corporate Asset Backed Corporation (CABCO).
Investor Verification Checklist
- Verify the full quarterly financial statements (revenue, net income, cash flow) in the separate Q2 2015 Form 6-K filed on July 31, 2015, as this document only provides capitalization and coverage ratios.
- Confirm the exchange rates used for USD translation (CHF 1 = USD 1.06927 as of June 30, 2015).
- Review the referenced Form 20-F for the year ended December 31, 2014, for comprehensive risk disclosures and management discussion.
- Check the specific composition of "Other" fixed charges, which relate to the interest component of rental expense.