Investor Presentation
April 2017
0
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1
Table of contents
1.
Introduction to 4finance
2.
Lending Process
3.
Loan Portfolio
4.
Financial Review
5.
Strategy and Outlook
6.
Appendices
2
Introduction to 4finance
3
4finance: a leader in responsible online/mobile
consumer lending
Putting our customers first, providing a convenient and transparent service using cutting edge data-driven technology
31%
24%
2016 return on
average equity
2016 revenue
growth
15%
2016 Adjusted
EBITDA growth
Revenue Growth
(in millions of EUR)
21%
2016 profit
before tax
margin
394
2.6x
149
2013
16
9
Countries of
operation (1)
Leading market
positions
>3,500
2016 full time
employees(2)
83%
2016 returning
customer
business(3)
Adjusted EBITDA
(in millions of EUR)
(1)
(2)
(3)
Includes Friendly Finance
Including Friendly Finance and TBI Bank
Issuance volumes to online customers who have returned, ie taken out and repaid at least one prior loan
137
2.0x
71
2013
Notes:
2016
2016
4
Geographic diversification
2016 Revenue: EUR 393m
FF
Other 4%
3%
Czech Republic
4%
LatAm:
3 countries
c.175m people
TBI
5%
Latvia
11%
Lithuania
5%
Finland
6%
Spain
14%
Europe:
13 countries
c.120m people
Sweden
6%
Denmark
9%
Georgia
9%
Poland
24%
5
Online/mobile customer profile
Issuance by customer type (2016)
Most common customer characteristics:
• Has a bank account
• Expenditure matches
monthly income
17% to new
customers
• Uses financing for
lifestyle choices or
necessities
1
loan
4 and more
loans
• 83% of loans are issued
• Underserved by
to returning customers
(2016)
traditional banks
83% to
returning
customers
2
loans
3
loans
Applications by source (2016)
Client split by age (2016)
25%
8%
18%
18%
17%
Desktop
12%
6%
4%
18-20
21-24
25-29
30-39
40-49
50-59
Mobile
37%
55%
Other
60+
6
Clear and simple online product structure
Single payment loan
Instalment loan
Line of credit
% in portfolio(1)
69.8%
29.2%
1.0%
Loan amount
• EUR 5–2,120
• EUR 50–3,182
• Limit up to EUR 2,100
Term
• Up to 35 days
• Up to 24 months
• Open-ended revolving credit line
Average loan size(2)
• 318 EUR
• 772 EUR
• 1,804 EUR
Pricing
• Single fee payable at maturity
• Monthly interest payments
• Repayment in multiple instalments
• Minimum monthly repayment (MRP)
• First withdrawal for free
• Further withdrawals: 11% of amount
• Monthly interest rate:
• Nominal annual interest rate: 58%–96%(3)
• Monthly interest rate:
• Option to reset scheduled repayment by a
• Flexible payment options as long as MRP
Fee amount
6%–28% in Europe; 30%-40% in LatAm(3)
• Option to extend up to 30 days
• Extension fee payable before extension
Extension
• Latvia, Lithuania, Finland, Sweden,
Poland, Denmark, Georgia, Spain, the
Czech Republic, Bulgaria, Romania,
Argentina, Mexico, Dominican Republic,
Slovakia
Markets
• Websites (mobile/tablet/web)
• Apple & Android native apps
• Phone call and SMS
• Offline: agents, loan shops and other partners
Distribution channels
(1)
(2)
(3)
•
month
Extension fee payable before extension
• Latvia, Lithuania, Sweden, Poland,
Denmark, Armenia, Spain, Romania, the
Czech Republic
8.5%-10.0%
is met
• Customers can change their repayment
date
• Finland, Latvia
• Websites (mobile/tablet/web)
• Apple & Android native apps (servicing
only)
• Call centre, e-mail, webchat and SMS
(servicing only)
Performing online loan portfolio as of 31/12/2016
Average size of loan issued (for Single Payment loan and Instalment loan) and average outstanding balance for Line of credit, data on 31/12/2016
Max term and max loan amount pricing
7
Responsible lending is fundamental to our business
•
What does responsible lending mean to 4finance?
–
Marketing: clear, simple and transparent products and terms
–
Pricing: position rates at lower end of market to ‘self select’ responsible borrowers who ‘shop around’
–
Underwriting: credit check and underwriting for ALL loans, including returning, with 30% average new customer acceptance
–
Customer care: local language, well staffed and responsive teams
–
Extensions: limited use (only a quarter of customers), no ballooning interest (interest paid for prior month) or ‘cycle of debt’
–
Collections: “push” payments from customer to 4finance, no automatic withdrawal from bank accounts
… these are practices common to mainstream bank lending … only common characteristic with “payday” lending is 30 day term
•
As a responsible lender, we welcome appropriate regulation
–
Active in regulatory / legislative consultations through industry associations and at top Group level including Group CEO
–
Supportive of clear regulatory frameworks
–
Clear, transparent products and pricing with IT/development resources to adapt products where needed
–
Launch of ‘responsible borrowing’ global website (www.responsibleborrowing.com) with local sites in 9 markets
–
Secured Consumer Credit company license from Finansinspektionen in Sweden in September, Microfinance organisation registration
from National Bank in Georgia in December, Czech license application underway
–
Active preparation / monitoring of upcoming regulatory changes and proposals
8
Lending Process
9
Our lending process: online, efficient, data-driven
Marketing
 A diversified
multi-channel
and data-driven
marketing and
acquisition
strategy
 Sophisticated
in-house
marketing
agency and
Digital Hub with
best-in-class
technology
Apply
 Prospective
customer
applies online
or through a
smartphone
application
 Simple,
convenient,
transparent
pricing and
application
process (‘UX’
optimized)
Underwrite
 Within a few
seconds,
proprietary
systems pull
data, determine
creditworthiness
and accept or
reject
Accept and
Fund
 Customer
executes legally
binding loan
agreement online
and funds are
advanced within
a few minutes
 Entire
disbursement
process built
around the
customer
experience to
ensure
satisfaction
Service
Collection
 More than 700 in-  Well staffed local
house specialists
provide support
in local language
across all
markets of
operation
 Key performance
indicators are
constantly
monitored to
improve customer
service and
enhance customer
retention
in-house debt
collection team
 Strong recovery
rates
 Full regulatory
compliance with
no controversial
debt collection
practices
 External agencies
used for 90+ DPD
collections
10
Robust credit scoring
2016 main loan applications
Traditional, alternative & proprietary
data sources
Proprietary database:
>11.5 million loans issued
>27 million applications reviewed
SPL
Instalment
4.1 million
Applications
0.5 million
Applications
2.5 million
Returning
Customers
1.6 million
New
Customers
0.4 million
Returning
Customers
0.1 million
New
Customers
88%
Acceptance Rate
41%
Acceptance Rate
54%
Acceptance Rate
20%
Acceptance Rate
EUR 737 million
EUR 75 million
83% of loans are issued to
returning customers(1)
Notes:
(1)
Issuance volumes to online customers who have returned, ie taken out and repaid at least one prior loan
11
Customer care and debt collection
Competitive advantage through Customer Care
•
TrustPilot score by countries Jan 2017
Local approach: more than 700 professional employees speaking
local language
•
Focus on quality: employees incentivized according to their personal
and team performance; regular employee knowledge testing and
training
•
Accessible: access via multiple channels: phone, e-mail, chat; on
weekends and at night
•
Customer centered: strict complaint escalation process, regular NPS
tracking to ensure customer satisfaction
•
«Quality Service Star» award received in Poland in 2015 for
consecutive year
9.7
Vivus.pl
9.3
Vivus.dk
8.2
8.3
Vivus.fi
Vivus.se
9.1
9.2
Zaplo.pl
Zaplo.dk
2nd
Debt collection principles
•
Full regulatory compliance: no controversial collection practices
•
Help customers find the best way to pay their loan
•
Strong in-house collection teams for early, middle and late collections
•
Robust and detailed procedures, based on efficiency and data driven
decisions
•
Assuring quality through continuous improvement
High quality international partners
12
Loan Portfolio
13
Diversified overall loan portfolio
Net portfolio c.EUR 500m following inclusion of TBI Bank
• 87% consumer loans
• 64% online loans / 36% banking
• Online loans issued in 2016: EUR 1,157m
- growth of 9% from 2015
Net loan portfolio(1), mEUR
494
308
178
Bank(2)
316
Online
241
178
Net loan portfolio, 31/12/2016
2013
Baltics
14%
TBI Bank: 36%
(funded at c.2%)
SME (TBI)
13%
Online: 64%
(funded at c.12%)
Romania (TBI)
10%
2014
2015
2016
Online loans issued(2), mEUR
Scandinavia
15%
1,062
Bulgaria (TBI)
13%
1,157
805
538
BG/RO (online)
1%
Poland
17%
Other
0.6%
Georgia/
Armenia Czech/
Slovakia
6%
4%
Spain
6%
2013
(1) Gross loan portfolio less provisions for bad debts.
2014
(2) Excludes finance leases.
2015
2016
(3) Continuing operations only
14
Online: non-performing loans and provisioning stable
•
Loans that are overdue more than 90 days are considered as nonperforming (NPLs)
•
At the end of 2016, NPLs represented 9.3% of total issued loans over
the last 730 days (excluding acquisitions)
•
Actual loss experienced on NPLs is approximately 50%-60% (57% as
of 31/12/2016)
•
Provisions for default are typically 5-10 p.p. higher
Non-performing loans (NPLs) as % of total loans issued(1)
Stable NPLs to issued loans ratio(1)
9.2%
8.8%
9.0%
9.3%
2013
2014
2015
2016
Conservative online loan provision coverage
9.3% of total
loans issued
80%
66%
57%
9%
EUR
197m
EUR
2,106 m
EUR
1,909m
Loans issued 10/2014-9/2016
(730 days)
NPLs as of
31/12/2016
Repaid and performing loans
31/12/2016
Loss given default
Provision
Provision
Overall provision
for default portfolio coverage buffer
coverage
(1) Total issued loans include the amount of online loans issued, excluding TBI Bank, during 730 days ending 90 days prior to the end of period
15
Online: asset quality trends for single payment loans
NPL / 2 year loan issuance
•
Non-performing loans to loan issuance ratio
tends to improve over time in each market
•
•
•
20%
15%
Spain
•
Georgia
Denmark
10%
Czech
More data: better scorecards
More experience: better debt collection
More returning customers
Different characteristics for each market
•
Portfolio mix shift drives overall Group
NPL/sales ratio (eg growth in Spain)
•
•
Current trend is in line with expectations
Poland
Finland
Increases in some markets with lower
new issuance (Finland, Lithuania,
Sweden)
5%
Latvia
Lithuania
Sweden
0%
2013
2014
2015
•
Higher NPL ratio countries also have higher
interest rates and revenue
•
Impairment / revenue ratio stable
2016
16
Financial Review
17
Financial highlights - profitable growth
Total equity (capital), m EUR
Adjusted EBITDA, m EUR
Revenue, m EUR
137
173
90
318
71
220
113
149
2013
66
2014
2015
2016
Net profit from continuing operations
(m EUR) and net margin
2013
2014
58
30%
2013
2015
2016
Adjusted interest coverage ratio
63
18%
16%
2014
2015
2016
3.8x
2013
2014
2015
2016
Capital/net loans, %
4.1x
47%
3.6x
37%
2016
2013
49
22%
2013
56%
4.6x
45
230
119
393
2014
2015
2014
47%
2015
2016
18
Highlights of FY 2016 results: EUR 63m profit
Results show continued progress
•
Revenue up 24% to EUR 393.2 million, Adjusted EBITDA up 15%
•
Full year cost to income ratio of 48% primarily reflects impact of
•
Friendly Finance: EUR 14m revenue for H2 2016 (up 65% year-on-year)
•
Sharing best practice, strengthening key control functions
2015
Stable online NPL/sales ratio of 9.3% and impairment/revenue ratio 23%
•
Pro-active portfolio management via debt sales (net proceeds demonstrate
2016
Adjusted EBITDA
+15%
137
119
prudent provisioning)
TBI Bank asset quality stable (NPL/gross loans ratio 10.8% with 103%
provision coverage on consumer loans & strong SME collateral coverage)
mEUR
•
2015
2016
Asset quality trends positive, within expectations
•
63
mEUR
TBI Bank: EUR 20m revenue, strong deposit growth in Q4
58
318
mEUR
•
+9%
393
Profit from continuing operations EUR 63.2 million, an increase of 9%
Positive contribution from acquisitions
continuing operations
+24%
acquisitions
•
Net Profit
Revenue
2015
2016
19
Quarterly expenses breakdown
2015
2016
70
60%
53%
50%
EUR million
60
47%
50
38%
39%
39%
40
11.8
30
20
6.3
2.4
6.3
48%
45%
7.9
0.6
7.3
2.9
8.3
11.9
50%
2.3
3.2
5.2
10.1
11.5
10.3
11.8
12.7
5.2
3.2
2.9
2.9
2.3
12.9
13.9
15.2
16.3
13.3
30%
11.6
11.8
12.1
14.6
Q1
Q2
Q3
Q4
13.8
13.2
11.2
Q1
Q2
Q3
15.1
0
0%
Marketing
Staff
IT
Other
TBI
FF
Limited cost
growth exacquisitions
20%
10%
10
•
•
•
40%
Additional
marketing
investment
Q4
Quarterly Cost/revenue, %
Cost base pre-acquisitions only increased by 4% in H2 2016 compared to H1; TBI only includes two months in Q3
Selective additional marketing investment in Q4 to support sales growth
Overall cost/income ratio a focus: revenue increase from growth in non-mature products plus cost efficiency improvements
Note: Other includes debt collection, legal and consulting, application inspection costs, communications, bank expenses, travel, rent
and utilities, depreciation & amortisation and other expenses
Q1-3 figures reflect reported unaudited results and Q4 figures reflect balance to full year results
20
Strategy and Outlook
21
TBI Bank: A strategic acquisition
Rationale
Why a Bank?
Offer new products
•
•
Credit cards
POS
Access more markets
•
Lower cost of funds for online
loans
•
What TBI delivers
•
Secured approval to use
Romanian credit card licence in
Poland
EU Passport licence
•
New market access over time
Access to deposit funding
•
•
EUR 224m of deposits at c.2%
Capacity to grow
22
Strategy for sustainable growth
• Continuous operational
• Maintain market leadership in
improvements, including
adaptation to new regulation
established core markets
Strengthening
foundation
• Expansion in Latin America,
• Big data: leverage existing
potentially Asia
• Developing operations in recently
proprietary database for product
development
Geographical
expansion &
diversification
entered markets: Romania,
Argentina, Mexico, Dom. Rep.
• Continue to pursue selective
expansion opportunities
• Continue instalment loan roll-out
• Line of credit launched in Finland &
Latvia, planned in other markets
Sustainable
growth
Leveraging on
technology
• Marketing Technology for better
targeting and product offering
Product
roll-out
• Continuous development of scoring
systems
• Electronic wallet, card payment
• Pilots of additional products
(eg point of sale, credit cards)
23
Conclusion
•
4finance has established a leading business
•
Solid full year results, driven by online business, delivering EUR 63 million net profit and EUR 137
million Adjusted EBITDA
•
TBI Bank contributing to overall results, with multiple initiatives underway
•
New market and product investments not yet mature: 15 of our 33 product instances launched H2
2015 onwards
•
Large scale, market leading operator with capabilities in place to deliver future growth
4finance continues to deliver
24
Appendices
25
Income statement
INCOME STATEMENT, M EUR
FY’2015
FY’2016
audited
audited
% Change
Interest income
318.3
393.2
24%
Interest expense
(28.7)
(38.7)
35%
Net interest income
289.6
354.5
22%
-
2.1
n/a
(77.0)
(89.7)
17%
Net fee and commission income
Net impairment losses on loans and receivables
General administrative expenses
(133.9)
(190.4)
42%
Other income/(expense)
(4.9)
Profit before tax
73.8
4.5
81.0
10%
Tax
Profit from continuing operations
Discontinued operations, net of tax
(15.7)
58.2
n/a
(17.8)
63.2
14%
9%
5.9
-
(100)%
Net profit
64.1
63.2
(1)%
Net impairment to revenue ratio %
24%
23%
Cost to income ratio %
42%
48%
Net profit margin (continuing operations), %
18%
16%
26
Balance sheet
BALANCE SHEET, M EUR
Loans and advances
Cash and cash equivalents
Assets held for sale
Property and equipment
Intangible assets (IT platform)
Goodwill
All other assets
Total assets
Loans and borrowings
Deposits from customers
FY’2015
FY’2016
audited
audited
% Change
308.3
56.9
4.3
17.4
0.6
50.7
493.9
157.6
16.0
12.3
39.8
43.4
168.4
60%
177%
n.m.
186%
129%
n.m.
221%
438.2
229.5
931.4
397.2
113%
73%
9.1
237.1
n.m.
26.3
67.3
156%
Total liabilities
264.9
701.2
165%
Total equity
173.3
229.4
33%
Total equity and liabilities
438.2
931.4
113%
FY’2015
40%
56%
4.2x
41%
16%
FY’2016
25%
47%
3.6x
31%
9%
All other liabilities
KEY RATIOS
Capital/assets ratio
Capital/net loan portfolio
Adjusted interest coverage ratio
Return on average equity(1)
Return on average assets(1)
(1) RoAE and RoAA based on net profit from continuing operations
27
Ownership structure
Vera Boiko
Beneficial owner
Control over shares through Trust Deed
Loucas Andreou
Uldis Arnicāns
Edgars Dupats
Shareholder of 25.5%
Shareholder of 25.5%
Shareholder of 49%, holding shares in trust on
behalf of Vera Boiko
Tirona Limited
(Cyprus)
4finance Group S.A.
(Luxembourg), 100%
28
Summary corporate structure
For footnote references, please refer to the summary corporate
structure in the preliminary Offering Memorandum
29
Management team
George
Georgakopoulos
Chief Executive Officer
Paul Goldfinch
Chief Financial Officer
−
−
−
−
−
−
−
−
−
Mārtiņš
Baumanis
−
−
−
Executive Vice President,
Loans
−
−
−
Manu Panda
−
Chief Risk Officer
−
Over 20 years of banking experience
CEO of Bancpost, the retail focused Romanian bank
Group Country CEO and Executive VP at Eurobank
13 years at Barclays Bank and Barclaycard with senior roles including
head of strategy for new business opportunities in IT/tech.
From 1997-2000 was seconded to EBA Clearing to establish the panEuropean clearing system, working extensively with major banks across
Europe and the European Central Bank.
Sanda Laicēna
Group Head, Legal
and Compliance
−
−
−
−
25 years of experience in financial sector
CFO of the Corporate and Investment Bank Division of Sberbank
(Russia)
Senior roles at UBS, including EMEA Regional Head of Accounting and
Controlling
COO/CEO of UBS Bank Russia
Part of 4finance management team since 2011
Over 16 years of experience in the financial sector and audit
Head of Finance Division / Finance Planning and Control Department at
Citadele (ex. Parex), a leading local bank in Latvia
Auditing and due diligence projects in PriceWaterhouseCoopers
Member of ACCA
Over 23 years of experience in consumer lending & credit card
industries, risk experience spans various leadership positons at bluechip companies, including Barclays, Citibank and GE Capital
Regional Vice president, leading Information Services at MasterCard
Asia Pacific
Managing director, Decision Analytics for Experian covering 12 markets
across Asia Pacific
Stuart Watkins
Chief Information Officer
George James
Taylor
Executive Vice president,
Strategy & Development
Nick Philpott
Group Head of HR and
Tax
−
−
−
−
−
−
−
−
−
Over 20 years of experience in the legal sector
Lawyer at Central Bank of Latvia
Head of Customer Service Legal Department and Deputy Head of
Legal Division at Citadele (ex. Parex)
Over 20 years of experience in establishing successful internet
enterprises throughout Europe
Managing major web projects for high street banks
Launching SAAS startups in the CEE region
CTO at CashPlay.Co
IT Manager at IFlow Solutions
CEO and Founder at C2D
Over 27 years in the Consumer Finance industry, covering major
markets such as the UK, Russia, the Middle East and Africa
CEO at RenCredit Africa
Senior Vice President at Renaissance Credit
EMEA Business Development Manager at The Collinson Group
−
Over 25 years of experience in the financial sector and the
accounting profession, working in London, Moscow and Paris.
−
Managing Director at Credit Suisse, Renaissance Capital
−
Partner at Ernst&Young.
30
High quality supervisory board
4finance aims to operate as a “quasi-public” company in terms of board structures, investor transparency and public reporting
Nicholas Jordan
Chairman
4finance Group SA
Supervisory Board
William Horwitz
Member of the Board
Dr. Cornelius Boersch
Member of the Board
Mark Ruddock
Member of the Board
Mr. Jordan has over 30 years of financial services experience, including 20 years in senior
positions with banks including Goldman Sachs (Co-CEO of Russia and CIS), UBS (Co-CEO of
Russia and CIS), Nomura (Chairman & CEO of Russia and CIS) and Deutsche Bank (Vice
Chairman). He is currently CEO of private equity firm Finstar Financial Group.
Mr. Horwitz is an independent FinTech advisor with over 20 years of experience in financial
services, including Barclays (as Director of Collections & Recoveries for Europe Retail & Business
Bank) and Capital One (14 years, including as VP of US card recoveries and MD of Capital One
Spain). He was formerly president of WDFC SA, guiding the restructuring of the company for FCA
licensing and suitability.
Dr. Boersch is the founder of venture capital firm Mountain Partners and has been a passionate
entrepreneur, investor and founder of numerous technology companies for the past 25 years. He
founded his first company whilst studying, developing it into the smart card broker and RFIDproducer ACG AG and successfully floating it on the Frankfurt Stock Exchange in 1999.
Mr. Ruddock is CEO of FinstarLabs and has over 15 years of leadership experience in venturebacked startups, spanning enterprise software, mobile applications and online financial services.
31
Evolution of 4finance
Number of countries:
2
3
4
2008
2009
2010
4
2011
7
2012
10
10
2013
2014
14
16
2015
2016
{acquisition}
LATVIA
LITHUANIA
FINLAND
SWEDEN
DENMARK
POLAND
SPAIN
GEORGIA
CZECH
REPUBLIC
BULGARIA
ROMANIA
ARMENIA
ARGENTINA
SLOVAKIA
DOMINICAN
REPUBLIC
MEXICO
32
TBI Bank update: solid results
Net loan portfolio(1), mEUR
TBI results: solid year end performance
•
−
−
−
Solid and consistent profitability
EUR 16.6m net profit in 2016 (vs EUR 16.6m in 2015)
Return on equity of 25% in 2016
EUR 7.5 million post-acquisition contribution to Group net
profit in 2016
• Strong retail business growth
− EUR 42 m additional consumer deposits in Q4 at sub 2%
blended cost
− EUR 14 m growth in consumer loans in Q4
• Stable asset quality and robust capital ratios
− 10.8% gross NPL ratio with low impairment to revenue
ratio
− Capital Adequacy Ratio of 22.3% remains robust with
substantial headroom
194
200
169
153
62
150
65
55
SME
100
50
97
105
2014
2015
132
Retail
0
2016
Consumer gross portfolio by type, 31/12/2016
6% 1%
50%
43%
Cash loans (EUR598 av.
size, 121k active, 47% av.
Rate)
POS (EUR269 av. size, 233k
active, 35% av. Rate)
Cards (EUR259 av. size, 33k
active, 28% av. Rate)
(1) Gross loan portfolio less provisions for bad debts, based on management reporting, book value. Includes finance leases
33
New market entry: case of Denmark
•
Market entry strategy is based on slow start to minimize cost and maximize option value:
Capital injected vs. net loan portfolio
•
Extensive market research and diligence, in-house and with external consultants
•
First 18 months
kEUR
8,000
Low initial capital injections: <EUR 3m in 6 months
•
Low roll-out risk
•
Market efficiency tested and scorecards fully ready in 6 months
•
Target month-on-month profitability within 18 months
•
Denmark case: month 13
6,000
4,000
2,000
0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18
Net loan portfolio
Capital injected (cumulative)
Market entry strategy: example of Vivus in Denmark (2012)
Research
Prepare
Soft Launch
Ramp-up
Marketing expenses vs. net profit (loss)
First 18 months
kEUR
600
400
Understand:
Establish:
• Market
• Pricing
• Competition
• Regulation
• Payments
• Licenses
• Office
• Key team
• Develop ‘minimum
viable’ product
• Start lending
• Limited marketing
• Rapid feedback to
• Full marketing
• Brand awareness
• Consumer
develop product
and risk scorecard
•
• Understand repeat
education
Economies of scale
customer behaviour
Breakeven
200
0
-200
-400
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18
Net profit (loss)
Marketing expenditure
34
Market exit: case of Estonia
•
•
Highly flexible and well-structured business model of 4finance
allows the Group to smoothly withdraw from markets where
operations do not prove to be viable, as demonstrated by the exit
from the Estonian market:
Net loan portfolio vs. recovered cash
4.5 months to complete exit (since March 11, 2015)
Total cash
recovered:
Net loan
835 portfolio as of
kEUR 11/03/2015
In March, 2015, Management of 4finance decided to exit the
Estonian market after less than 2 years of operation
Sale of portfolio
90
112
242
40
180
•
Market exit executed in 4.5 months
•
Marketing expenses reduced by 97% in the first month following the
decision
•
# of staff reduced by 45% in the first two months following the
decision
•
77% of net loan portfolio value collected in the first 3 months
350
Net portfolio Cash flow 1 Cash flow 2 Cash flow 3 Cash flow 4 Cash flow 5 Total cash
Cash flows during the exit
kEUR
Sale of portfolio
Office closure
360
•
1,013
kEUR
At the final exit date, 21% more cash recovered compared to the
net loan portfolio at the decision date
300
240
180
•
Overall, an efficient exit with minimum impact on the total
performance of the Group
120
60
0
-60
Month 1
Month 2
Cash inflows
(1) Excluding charges from the Group’s HQ (IT and management)
Month 3
Month 4
Administrative costs (1)
Month 5
Net inflows
35
Contacts
4finance - Investor Relations
Email: [email protected]
Contact: James Etherington
Phone: +44 7766 697 950
Registered office: Lielirbes iela 17a-8, Riga, LV-1046, Latvia
36