KRUK's 1Q 2013 results: Soaring higher
Summary and financial highlights for Q1 2013:
- In Q1 2013, the KRUK Group posted PLN 19.7m in net profit, up by 41% on Q1 2012.
- Recoveries from debt portfolios purchased in Q1 2013 amounted to more than PLN 118m, up by 9% on the corresponding period of 2012.
- In Q1 2013, KRUK generated more than PLN 9m of gross profit on debt outsourced for collection (credit management), up 201% on Q1 2012, mostly on the back of improved results on corporate credit management.
- In January-April, KRUK issued PLN 120m worth of bonds. In the case of the most recent issue, worth PLN 60m, KRUK reduced the financing cost from 4.60pp to 4.20pp above 3M WIBOR.
- Investments in debt portfolios in Q1 2013 amounted to PLN 49m, a fourfold increase on Q1 2012. In Q1 2013, the Group purchased 12 debt portfolios with a total nominal value of PLN 368m, including 3 portfolios in Poland, 5 in Romania and 4 in the Czech Republic and Slovakia.
- The Company’s market capitalisation exceeded PLN 1bn.
- On April 3rd 2013, after having held its investment for ten years, Enterprise Investors sold its holding of 24.83% of KRUK shares.
- The group of significant shareholders, holding more than 5% of the Company’s share capital, was joined by institutional investors ING PTE and AMPLICO PTE. In total, pension funds, including Aviva OFE and Generali OFE, hold 39.14% of the Company’s share capital.
- At present, KRUK’s largest shareholder is Piotr Krupa, the Company’s founder, CEO and key person behind its success, holding a 15.47% ownership interest.
KRUK Group – consolidated financial highlights
| PLNm | Q1 2012 | Q1 2013 | Change Q1 2013 vs. Q1 2012 | 2012 | Performance of 2012 result |
|---|---|---|---|---|---|
| Revenue | 79.9 | 95.9 | 20% | 343.0 | 28% |
| EBIT | 28.6 | 33.9 | 19% | 136.7 | 25% |
| cash EBITDA* | 68.5 | 74.8 | 9% | 292.3 | 26% |
| Net profit | 14.0 | 19.7 | 41% | 81.2 | 24% |
* Cash EBITDA = EBITDA + recoveries from purchased debt portfolios – revenue from collection of purchased debt
“We are satisfied with KRUK’s performance in Q1 2013. Net profit went up by more than 40%, while investments increased nearly four times, compared with Q1 2012. At present, KRUK holds a debt portfolio with a nominal value of over PLN 14bn - a solid basis for delivering results in the coming years. Our objective is to become more effective in getting through to debtors from this portfolio and thus improve cash recovery rates. In Q1 2013, KRUK invested in its debt collection processes, expanding the network of field consultants and bringing more cases to court,” said Piotr Krupa, KRUK’s CEO.
The KRUK Group sees potential in the market of corporate debt purchase in Poland and abroad, as well as bank debt incurred by SMEs.
“In our opinion, in the next 3–4 years corporate debt could become a driver of growth in addition to consumer debt. Over the past few years, banks have extended a large number of loans to SMEs. At present, these companies are struggling to pay them back. We therefore expect banks to intensify their efforts to sell such debt. In the near future, mortgages are also likely to become a driving force behind our growth,” commented Mr Krupa.
In the first quarter of 2013, KRUK launched new marketing and educational campaigns designed to promote amicable settlement solutions in Poland, Romania, the Czech Republic and Slovakia.
“The first months of 2013 saw the beginning of new marketing campaigns in all of the Group’s markets. KRUK embedded its marketing message in two episodes of “Barwy Szczęścia”, one of the most popular TV series aired by the public broadcaster in Poland – its services were an important plot device allowing the main characters to deal with their indebtedness. In Romania, where folk music is very popular, Sofia Vicoveanca, a folk singer, became the face of KRUK’s campaign. We also launched educational press campaigns in the Czech Republic and Slovakia,” he added.