Current Report No. 44/2018: Completion of strategic review and adoption of strategy for 2019 – 2024

The Management Board of KRUK S.A. (the “Company”) announces that on December 4th 2018 it resolved to complete a review of strategic growth options (Review) for the Company’s Group (the “Group”) that was announced in Current Report No. 24/2018 of July 9th 2018. 

As part of the Review, the Management Board analysed growth scenarios and assessed market conditions and forms of potential cooperation with prospective investors, including the option of acquiring an international financial partner for the Company or entering into a transaction with a different ownership structure. 

As a result of the Review, the Management Board of KRUK S.A. resolved that under current market conditions the ownership structure of the Company as a public company is optimal to achieve the Company’s long-term objective to build Europe’s leading debt management company. The Company further reports that as a result of the completed review of strategic options, the Management Board has developed a strategy for the KRUK Group for 2019 – 2024 (the Strategy). 

The overriding objective of the Strategy is for the KRUK Group to achieve a consolidated net profit of PLN 700m by 2024, assuming no need to recapitalise the Company and a conservative approach to debt, significantly below the current covenant of 4x net debt/cash EBITDA.

The Strategy will be operationalised in 2019 and will be subject to regular reviews by the Management Board. The indicated values are the goal of the Management Board and do not constitute a forecast of financial results. 

The Company also reports that the Management Board wants KRUK S.A. to be a dividend-paying company during the term of the Strategy, but that dividend payment recommendations will be determined on a case-by-case basis, taking into account growth plans and prospects, capital investment needs, as well as the current debt level and the Group’s financial position.