Slide 1: Q2 2017 Axactor AB
Q2 2017 Axactor AB August 14, 2017
Slide 2: Key highlights Q2
Key highlights Q2 REVENUE * ERC EBITDA * CASH EBITDA* CASH BALANCE 26.9 EUR MILLION 511 EUR MILLION 6.1 EUR MILLION 9.4 EUR MILLION 19.6 EUR MILLION +245% y/y +20% q/q 26% margin • 3PC growth 18% compared to Q1 • Successful entry to secured space in Spain through acquisition of secured portfolio • D
Slide 3: Events after Q2 closing
Events after Q2 closing • DNB/Nordea made a 5th tranche of EUR 40 million available with 100% gearing allowed DNB/Nordea facility on new NPLs – total facility increased from EUR 120 million to 160 million New 3PC Agreements • Third party collection growth continues with new agreements announced in S
Slide 4: Balanced revenue mix
Balanced revenue mix Revenue per Quarter (EUR million) Q2 Revenue Distribution per Country 30 26.9 25 Other 7% GER 19.7 20 18.5 20 % SWE 16 % 15 11.1 ITA Q2 7% 10 7.8 26.9m NOR 5 10 % 0 SPA 40 % Q2-16 Q3-16 Q4-16 Q1-17 Q2-17 GER ITA NOR SPA SWE Other • Swedish revenue mainly derived from the BN port
Slide 5: Balanced revenue mix
Balanced revenue mix Revenue Development per Product (EUR million) 37% revenue growth in Q2 versus previous quarter 30 • Main driver is NPL collections where BN portfolio acquired 26.9 in Q1 performs strongly 25 • 3PC grows 18% mainly driven by Spain where 7 new 3PC 19.7 agreements were signed in Q2
Slide 6: Financial performance 1H 2017 vs 1H 2016
Financial performance 1H 2017 vs 1H 2016 Gross Revenue (EUR million) ERC (EUR million) 50 46,6 600,0 511 40 500,0 400,0 30 +36m or +385m 300,0 20 326% or 200,0 305% 10,9 126,0 10 100,0 0 0,0 1H 2016 1H 2017 1H 2016 1H 2017 • Revenue growth driven by additional platforms • Book value of NPL portfolio
Slide 7: Financial performance 1H 2017 vs 1H 2016
Financial performance 1H 2017 vs 1H 2016 EBITDA (EUR million) CASH EBITDA (EUR million) 1H 2016 1H 2017 1H 2016 1H 2017 9 16 7.1 13.0 7 12 5 8 +11.7m +15.8m 3 or or 4 1 258% 561% 0 -1 -4 -2,8 -3 -5 -4,5 • EBITDA growth driven by increasing business volumes and less cost related to M&A transactions •
Slide 8: Collection on NPL portfolios vs. Initial business case
Collection on NPL portfolios vs. Initial business case (EUR million) 18,0 120% • 2016 performance colored by external 16,0 102% servicing and replacement of old collection 97% 100% systems in all countries 91% 14,0 87% 14,3 • Q4-16 collection includes a large 12,0 80% settlement of 900k which was no
Slide 9: Portfolio Statistics
Portfolio Statistics Historical Development ERC (EUR million) ERC per year (EUR million) 600 SPA ITA GER SWE NOR 90 SPA ITA GER SWE NOR 510,7 77,5 80 500 427,1 70 65,0 65,7 400 60 51,0 317,1 50 300 42,2 253,2 40 36,2 30,9 200 27,2 30 24,0 126,0 21,3 18,6 20 16,6 14,8 13,0 100 10 6,8 0 0 Q2-16 Q3-16
Slide 10: Portfolio Statistics
Portfolio Statistics Book value Portfolios (EUR million) Capex (EUR million) SPA ITA GER SWE NOR SPA ITA GER SWE NOR 300 70 66,5 242,1 60 250 54,3 50 191,9 200 40 33,8 150 128,0 30 98,7 100 63,7 20 13,6 50 10 1,3 0 0 Q2-16 Q3-16 Q4-16 Q1-17 Q2-17 Q2-16 Q3-16 Q4-16 Q1-17 Q2-17 -10 • Two smaller portf
Slide 11: Q2 Income statement
Q2 Income statement Income statement Key comments 2Q 2Q EURO 1000' 2017 2016 • 36.6% revenue growth compared to Q1-17 Income 26 922 7 792 Amortization of debt portfolios -3 290 -845 • Double digit EBITDA margin Net revenue 23 632 6 948 Personnel expenses collection -6 640 -1 644 • Cash EBITDA above
Slide 12: Market trends in NPL unsecured
Market trends in NPL unsecured Germany Spain • Strong macro situation increasing the long term • High volume of transactions expected to continue across expected recovery all sizes and products • Strong competition on NPL portfolios, but limited • Strong focus on legal actions, focused on benefiting
Slide 13: 2H 2017 main focus areas
2H 2017 main focus areas • Ensure volume growth on current platform and new SPV NPL acquisitions – Primary Sales from FI • Growth in the “Forward Flow deals” segment • Roll-out of Payment Services in SWE, ITA and GER Product and market strategy • Focus on growth in existing geographical markets • Bu
Slide 14: Overview Operational systems – "One Axactor"
Overview Operational systems – “One Axactor” Country NEW COLLECTION SYSTEM Gira Ikaros Predator Recupera Aptic specific DIALER Altitude Altitude Altitude Altitude Altitude IT INFRASTRUCTURE Intility Intility Intility Intility Intility ERP SYSTEM/ INC. HR UBW UBW UBW UBW UBW DEBTOR PORTAL Standard/TB
Slide 15: Co-investment partnership and equity issue
Co-investment partnership and equity issue
Slide 16: What we said (from Q4/'15 presentation)
What we said (from Q4/´15 presentation) Step 1 ✓ Step 2 ✓ Step 3 ✓ • Top 3 market share in debt • Establish debt collection collection in Spain ✓ • Enter new growth markets with Strategy service platform in Spain • Collection of debt on acquired platform and portfolio ✓ Non-Performing loan portfolio
Slide 17: Co-invest partnership and equity issue
Co-invest partnership and equity issue • Axactor and Geveran Trading Co. Ltd. (“Geveran”) have entered into a Letter Of Intent regarding the establishment of a jointly owned portfolio investment company that will be 50 / 50 owned with EUR 300 million in investment capacity Co-investment • Geveran is
Slide 18: Overview of the transactions
Overview of the transactions Post issue shareholding 1 Equity issue Major Geveran Equity issue of 240 million shares at NOK 2.49 per Shareholders 9.96% 90.04% share in Axactor with gross proceeds of c. EUR 64 million EUR 40 EUR 24 million equity million equity • Geveran subscribed 151 million shares
Slide 19: Portfolio investment company
Portfolio investment company Capital structure with EUR 300 mill capitalization Rationale for Axactor • Enables bid for significantly larger portfolios while Geveran Axactor Equity EUR 30 million EUR 30 million managing risk with a partner 20% (10%) (10%) • Optimizes cost of capital for larger purch
Slide 20: Head terms of Letter Of Intent (LOI) with Geveran
Head terms of Letter Of Intent (LOI) with Geveran Scope Governance • Portfolio size: >EUR 30 million Capex • Axactor and Geveran to have 50% each of board representatives • Geography: All Axactor countries • Open book principle on pricing and performance • Type: Secured and unsecured consumer NPLs •
Slide 21: Key terms of the Private Placement
Key terms of the Private Placement • 240 million shares to be issued (of 400 million shares authorization approved by AGM in May 2017) Share issue • Post placement total number of outstanding shares will be 1,516 million Price • NOK 2.49 per share Gross proceeds • Approximately NOK 598 million / EUR
Slide 22: Aggregate investment capacity of EUR 415 million
Aggregate investment capacity of EUR 415 million 415 Figures in EUR million 300 115 80 35 24 4 52 Cash on Undrawn RCF Italian loan facility Axactor stand alone Equity issue (less Axactor stand alone Portfolio investment Total investment balance sheet1 (pre equity issue) Axactor investment (post equi
Slide 23: Summary Q2 Presentation
Summary Q2 Presentation • 37% revenue growth (Q2 vs Q1) • Solid EBITDA/Cash EBITDA • 5th tranche from DNB/Nordea released after Q2 closing • Successful entry to the Secured space in Spain • Good performance in Sweden • Equity issue with gross proceeds of appx EUR 64 million • Letter Of Intent (LOI)
Slide 24: axactor.com
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Slide 25: Q2 Balance Sheet
Q2 Balance Sheet Assets Key comments EURO 1000' 30.06.2017 30.06.2016 31.12.2016 • Book value of NPLs is 242m, including Stock of Secured Intangible non-current assets Assets (Spain) Intangible assets 18 254 12 655 18 347 Goodwill 54 294 43 833 53 491 • Available cash at end of Q2 is 19.7 million De
Slide 26: Q2 Balance Sheet
Q2 Balance Sheet Equity and liabilities Key comments EURO 1000' 30.06.2017 30.06.2016 31.12.2016 Equity for equity holders of the parent • Total interest bearing debt of EUR128.3 million whereof in Share capital 66 814 50 736 64 198 Italy EUR 31.5 million in Itlay. Other paid-in capital 142 416 201