PLN 51m in net profit for H1 2013
PLN 51m in net profit for H1 2013
KRUK Group summary and financial highlights for H1 2013:
- The KRUK Group earned PLN 198.9m of consolidated revenue – up by 25% year on year;
- Net profit went up by 57%, to PLN 50.7m;
- The KRUK Group strengthened its position as the leader of the debt collection market in the countries where it operates – a 26% share in the debt portfolio purchase market (Poland, Czech Republic, Slovakia and Romania) and a nearly 25% share in the credit management market (Poland and Romania);
- In H1 2013, the Group invested PLN 184m in debt portfolios, i.e. 91% more than in H1 2012; In H1 2013, the Group purchased 26 debt portfolios, primarily from banks, including 7 portfolios in Poland, 11 in Romania and 8 in the Czech Republic and Slovakia, with a total nominal value of more than PLN 1.6bn;
- Recoveries from purchased debt portfolios totalled PLN 239.6m, having grown 11% year on year; Gross profit on credit management services was PLN 12.2m, marking a 129% y-o-y increase, attributable mainly to an improved result on corporate credit management services in Q1 2013;
- Remeasurement of the fair value of assets of PLN 7.9m formed a positive contribution to the Group's financial performance;
- Fair value of debt portfolios carried in the Group's statement of financial position amounted to nearly PLN 1bn, which gives a solid base for results in future periods; In the period January-August 2013, KRUK issued PLN 185m worth of commercial paper, and redeemed commercial paper amounting to PLN 43m.
KRUK Group – consolidated financial highlights
| PLNm | H1 2013 | H1 2012 | H1 2013/H1 2012 change | 2012 | % of 2012 result |
|---|---|---|---|---|---|
| Revenue | 198.9 | 159.3 | 25% | 343.0 | 58% |
| EBIT | 76.0 | 60.4 | 26% | 136.7 | 56% |
| Cash EBITDA* | 148.3 | 139.1 | 7% | 292.3 | 51% |
| Net profit | 50.7 | 32.3 | 57% | 81.2 | 62% |
*Cash EBITDA = EBITDA + recoveries from purchased debt portfolios - revenue from collection of purchased debt
Discussion of results:
"In our opinion, the KRUK Group's performance in H1 2013 was strong, with net profit 57% higher than in H1 2012. The second quarter was very successful in terms of our operating and investment activities. Debt portfolios purchased from April to June 2013 amounted to more than PLN 135m, up by 61% compared with Q2 2012. It is also worth noting that we outperformed the stock exchange analysts' consensus forecast for Q2 2013," said Piotr Krupa, President of the KRUK Management Board.
"In H1 2013, recoveries form purchased debt portfolios were nearly PLN 240m, having increased 11% year on year. In Poland, interest rates were further reduced in Q2 2013, contributing to lower finance costs at the Company and higher net profit of the Group in H1 2013. Moreover, we benefited from the situation on the foreign exchange market following the appreciation of the Romanian leu," added Piotr Krupa.
In Poland, in H1 2013 the nominal value of consumer debt sold reached a record high PLN 5bn. Total expenditure on debt portfolio purchases in the consumer debt segment amounted to PLN 440m in the period. In Romania, the nominal value of debt sold in H1 2013 was PLN 0.7bn. The retail debt portfolio market in the Czech Republic and Slovakia remains stable. The nominal value of debt purchased on the two markets in H1 2013 was PLN 0.8bn, with PLN 0.2bn spent to purchase the debt.
"In H1 2013, we actively purchased debt portfolios investing more than PLN 184m, which was 91% more than in H1 2012. These purchases strengthened the KRUK Group's position as the leader of the debt purchase market in Central Europe, in which it has a 26% share in terms of investments in debt portfolios," said Piotr Krupa.
In H1 2013, the credit management business generated a gross profit of PLN 12.2m, which was higher by over 129% year on year. Revenue from credit management operations in the period was PLN 22.7m, compared with PLN 15.9m in H1 2012. Higher revenue and gross margin of the credit management business in H1 2013 was achieved mainly as a result of collection in Q1 2013 of a large corporate debt.
The operations of RD ERIF BIG, a credit information agency, and Novum loans generated total revenue of PLN 5.2m, up by 50% compared with the corresponding period of 2012. As at the end of H1 2013, RD ERIF BIG's database contained more than 1.5m records, and the number of loans advanced was 4.5 thousand, having increased by 35% year on year.