Dovalue S.p.a. · MIL:DOV
Dovalue — doBank — FY2017 Earnings Presentation
25 slides from Dovalue's earnings presentation, Feb 12, 2018
Slide 1: Preliminary Financial Results Full Year 2017
Preliminary Financial Results Full Year 2017 February 12th 2018
Slide 2: doBank team presenting today
doBank team presenting today General Manager of Fincantieri in 2015 From 2013 to 2015 Chairman and CEO of Sorgenia CFO, General Manager of International Operations of Telecom Italia and Chairman of Telecom Italia Sparkle from 2009 to 2013 Andrea Mangoni Previously CEO of ACEA Group CEO CEO
Slide 3: 1. Key Highlights
1. Key Highlights
Slide 4: Summary
Summary Gross Collections: €1.8bn vs €1.7bn in FY 2016 (+8%/3%)1, in line with guidance Gross Revenues: €213m vs €206m in FY 2016 (+3%) Financial Results EBITDA: €70m vs €64m in FY 2016 (+9%) - EBITDA margin from 31% to 33% FY 17 vs FY 16 Net Income: €45m vs €40m in FY 2016 (+11%), EPS of €0
Slide 5: Full Year 2017 Preliminary Results
Full Year 2017 Preliminary Results Collections up 8%/3%1 from FY 2016 despite declining GBV Gross revenues up 3% on the back of higher performance fee revenues and ancillary & other revenues Focus on cost control delivered strong margin expansion and 2-digit growth in net income 2016 PF 2017 F
Slide 6: Key recent awards unlocking value through operating leverage
Key recent awards unlocking value through operating leverage Recent awards New GBV on-boarding in 1Q18 (€ bn) +€11.4 bn Loan doBank Timing of (+15% vs YE ’17) origination mandate on-boarding 8.0 2.4 88.1 Monte dei Paschi March BMPS di Siena ~ €8.0 bn 2018 76.7 1.0 B. Marche, February REV B. Etruria
Slide 7: #1 player in a rapidly growing servicing market
#1 player in a rapidly growing servicing market doBank is a clear leader in the Italian Special & Master Servicing markets, playing a key role in all main transactions 2018 and 2019 are expected to be key years for the market with significant growth opportunities in terms both of sale of portfol
Slide 8: Servicing Pipeline
Servicing Pipeline ~€64bn of sale transactions in the NPL market executed in 20171 and ~€70bn expected in 20181 alone ECB NPL guidelines and Calendar Provisioning combined with IFRS9 introduction providing an incentive for banks to focus on a more proactive approach to NPEs Small and medium ba
Slide 9: Strategic pillars
Strategic pillars 1 1) Add more servicing 2 2) Increase collections and efficiency 3 3) Grow ancillary services business 1 2 3 Efficiency & New Servicing Contracts Ancillary Business Effectiveness Increased Collections on Sold by Outsourced by Existing Portfolios & New Services Banks Banks Work Forc
Slide 10: 2. Financial Review
2. Financial Review Bank Servicing» Lending Selations'
Slide 11: Key financial highlights
Key financial highlights €m FY 20161 FY 2017 ∆ (%) Largest Servicing Collections, write-offs and sale of Portfolio in the GBV EoP 80.9bn 76.7bn (5.2%) portfolios by clients partially offset by Revenue drivers Italian Market inflows from new and existing clients Best-in-class +8.4% Improving effe
Slide 12: Focus on GBV evolution
Focus on GBV evolution GBV decreasing from €80.9bn to €76.7bn in FY17, mainly driven by significant trend of collections and net write-off as well as portfolios sales by Clients while new portfolio wins onboarding shifted to 1Q18 Considering the new inflows already committed with Italian Recover
Slide 13: Portfolio diversification
Portfolio diversification GBV Composition Significantly higher diversification FY2017 FY2017 PRO-FORMA NEW CONTRACTS in the allocation between Banks & Investors 64% / Banks 36% Investors 68% / Banks 32% Investors and among clients Other compared to IPO time (60% Investors Italian REV Other Banks R
Slide 14: Seasonality of collections across quarters
Seasonality of collections across quarters Historical quarterly pattern % on yearly collections1 Significant improvement in annual collection 2014 2015 2016 rate (2.4% in 2017 vs 2.1% on 2016) despite declining GBV Collection results in line with target Collections evolution featuring a season
Slide 15: Ancillary and other services (inc. co-investment)
Ancillary and other services (inc. co-investment) Business area Key Facts Financial Results Revenues in €m Closed contract with FINO starting from 4Q17 +14% 16.5 Contracts win with small banks to see effects in 14.4 2018 Closed contract with FINO starting from 4Q17 Real estate auctions trend
Slide 16: From gross to net revenues
From gross to net revenues Revenues breakdown €m FY 2017 92% 8% (8%) Servicing fee 2017 vs. 2016 variance vs collection growth 206.2 196.6 16.5 213.0 195.0 Ancillary explained by base/collection 14.4 Base: 38.1 (18.1) fee mix and portfolio sale indemnity difference Collections Servicing: and other
Slide 17: Focus on operating expenses
Focus on operating expenses Operating expenses breakdown €m EBITDA 31% 33% Margin 124.8 124.1 Stable operating cost base in 2017 year-on- 19.2 15.5 year, of which 67% HR costs 42.5 8.1 Personnel cost increase, as anticipated, due 9.1 41.4 to new management team and IPO incentive 14.2 17.8 plan f
Slide 18: NWC and net financial position
NWC and net financial position Net Working Capital €m FY2017 99.4 NWC positively impacted by shift 79.3 78.3 of client diversification towards (21.1) Investors Receivables from Banks and Investors for servicing contracts in place 2016PF Receivables Payables NWC Net Financial Position €m FY2017
Slide 19: Regulatory capital
Regulatory capital CET 1 RWA Breakdown €m €m 141.5 535.5 519.3 106.9 62.5% 71.9% 37.5% 28.1% 2016PF 2016 PF 1H 2017 FY2017 2016 PF FY2017 Credit & Counterparty Risk Operational Risk Ratio 21% 26% Excess capital to support business growth and remunerate investors Notes: Regulatory capital ratios incl
Slide 20: What's next?
What’s next? Continue performance improvement through standardization and simplification and leveraging on the recent favorable legislative proposals on NPLs as well as IFRS9 introduction Maintaining Full value extraction from long-term contracts with Banks currently in place and leadership rela
Slide 21: 3. Appendix
3. Appendix
Slide 22: Condensed Consolidated Income statement 2017
Condensed Consolidated Income statement 2017 (€/000) Condensed consolidated income statement Year Change Year Change 2017 2016 PF Amount % 2016 % Serv icing rev enues 196.554 191.754 4.800 3% 160.512 22% Co-inv estment rev enues 665 25 640 n.s. 25 n.s. Ancillary and other rev enues 15.796 14.402 1.3
Slide 23: Consolidated Balance Sheet 2017
Consolidated Balance Sheet 2017 (€/000) Change Assets 12/31/2017 12/31/2016 Amount % 10 Cash and cash equiv alents 21 18 3 17% 40 Av ailable-for-sale financial assets 24.001 1.047 22.954 2192% 60 Loans and receiv ables with banks 49.449 52.575 (3.126) -6% 70 Loans and receiv ables with customers 2.8
Slide 24: Tax assets
Tax assets Tax assets breakdown €m Tax assets are originated from 2015 UCCMB 8.8 transaction in 2015 A Tax Credit: 37.7 Off-settable against 2017 taxes (currently used 55.4 against VAT) B DTAs (Loss Carry forward): Can be used to off-set future direct and indirect 41.1 taxes, subject to futu
Slide 25: Disclaimer
Disclaimer This presentation and any materials distributed in connection herewith (together, the “Presentation”) do not constitute or form a part of, and should not be construed as, an offer for sale or subscription of or solicitation of any offer to purchase or subscribe for any securities, and nei