Slide 1: Interim report January – September 2017
Interim report January – September 2017 October 18th, 2017 Mikael Ericson, CEO Erik Forsberg, CFO
Slide 2: Agenda
Agenda • Q3 Highlights • Q3 Financials • Future Outlook • Appendix
Slide 3: Leading the way to a sound economy
Leading the way to a sound economy
Slide 4: Q3 Highlights
Q3 Highlights intrum
Slide 5: Q3 2017 Highlights
Q3 2017 Highlights High activity and good progress implementing the merger of Intrum Justitia and Lindorff • New brand, “Intrum” and new corporate identity launched • All key management teams appointed • Initial cost synergies being realized • Process for divestment of certain subsidiaries in Northe
Slide 6: Q3 Financials
Q3 Financials - Unless otherwise stated, Q3-16 and YTD 2016 are based on pro- forma figures , i.e. including financials from Lindorff for these periods.
Slide 7: Financial summary
Financial summary Pro forma Change Pro forma Pro forma Change SEK M, unless otherwise indicated Q3 2017 Q3 2016 % YTD 2017 YTD 2016 % Revenues 2 986 2 623 14 9 118 7 475 22 Cash EBITDA excl NRIs 2 065 1 695 22 5 927 4 846 22 EBITDA excl NRIs 1 199 1 043 15 3 575 2 955 21 EBIT excl NRIs 1 037 567 83
Slide 8: Northern Europe
Northern Europe Pro forma Pro Forma Pro Forma Q3 Q3 Change FX Adjust YTD YTD Change FX Adjust Excl PD Revals and Excl NRI, SEK M 2017 2016 % % 2017 2016 % % Revenues 983 892 10 10 2 894 2 756 5 3 EBIT 410 343 20 20 1 102 1 085 2 0 EBIT Margin, % 42 38 38 39 Q3 Highlights Market leader • Good revenue
Slide 9: Western & Southern Europe
Western & Southern Europe Pro forma Pro Forma Pro Forma Q3 Q3 Change FX Adjust YTD YTD Change FX Adjust Excl PD Revals and Excl NRI, SEK M 2017 2016 % % 2017 2016 % % Revenues 578 474 22 22 1 713 1 427 20 18 EBIT 123 77 60 61 322 287 12 11 EBIT Margin, % 21 16 19 20 Q3 Highlights Market leader • Rev
Slide 10: Central & Eastern Europe
Central & Eastern Europe Pro forma Pro Forma Pro Forma Q3 Q3 Change FX Adjust YTD YTD Change FX Adjust Excl PD Revals and Excl NRI, SEK M 2017 2016 % % 2017 2016 % % Revenues 779 650 20 20 2 389 1 941 23 20 EBIT 283 224 26 25 865 688 26 23 EBIT Margin, % 36 34 36 35 Q3 Highlights Market leader • Goo
Slide 11: Spain
Spain Pro forma Pro Forma Pro Forma Q3 Q3 Change FX Adjust YTD YTD Change FX Adjust Excl PD Revals and Excl NRI, SEK M 2017 2016 % % 2017 2016 % % Revenues 644 586 10 10 2 016 1 293 56 54 EBIT 220 -97 -327 -327 632 108 485 483 EBIT Margin, % 34 -17 31 8 Q3 Highlights Market leader • Revenue growth f
Slide 12: Credit Management Services
Credit Management Services Pro forma Pro Forma Pro Forma Excl PD Revals and Excl NRI Q3 Q3 Change FX Adjust YTD YTD Change FX Adjust SEK M 2017 2016 % % 2017 2016 % % Revenues 2 155 1 952 10 10 6 600 5 404 22 19 Service Line Earnings 596 298 100 100 1 865 1 319 41 38 Service Line Earnings Margin, %
Slide 13: Financial Services
Financial Services Excl NRI, SEK M Pro forma Pro Forma Pro Forma unless otherwise indicated Q3 Q3 Change FX Adjust YTD YTD Change FX Adjust 2017 2016 % % 2017 2016 % % Revenues 1 358 1 129 20 20 4 100 3 379 21 18 Service Line Earnings 752 588 28 27 2 203 1 844 19 17 Service Line Earnings Margin, % 5
Slide 14: Common Costs
Common Costs Pro forma Pro Forma Pro Forma Q3 Q3 Change FX Adjust YTD YTD Change FX Adjust Excl NRI, SEK M 2017 2016 % % 2017 2016 % % Common Costs Excl NRI -311 -318 -2 -2 -1042 -937 11 8 Q3 Highlights • Items affecting comparability (IAC) of 38 MSEK in Q3- 17, reducing common costs for the quarter
Slide 15: Purchased Debt - revaluations
Purchased Debt - revaluations Pro Forma Pro Forma Pro Forma Q3 Q3 YTD YTD PD revaluations, SEK M 2017 2016 2017 2016 Northern Europe 13 20 33 21 Central & Eastern Europe -9 -5 56 44 Western & Southern Europe 4 -5 25 21 Spain -7 1 -8 -28 Total 1 20 106 56 15
Slide 16: NRIs and Revaluations by Profit and Loss Segment
NRIs and Revaluations by Profit and Loss Segment Q3 2017 NRI's Distribution Regions Service lines SEK M, excluding discontinued business NOE CEE WSE Spain Group CMS FS Common Group EBIT including NRIs 399 262 119 197 977 588 743 -354 977 Lindorff Transaction NRIs Lindorff Integration NRIs -24 -12 -8
Slide 17: Cash flow statement
Cash flow statement Q3 Q3 Dev YTD YTD Dev SEK M 2017 2016 % 2017 2016 % Operating earnings (EBIT) 977 506 93 1 921 1 379 39 Depreciation 163 40 308 245 120 104 Amortization and revaluation of purchased debt 866 389 123 1 845 1 137 62 Income tax paid -97 -33 194 -283 -187 51 Changes in factoring rece
Slide 18: Balance sheet – Highlights
Balance sheet – Highlights Pro Froma 30 Sep 30 Sept Dev SEK M 2017 2016 % Intangible fixed assets 29 267 34 683 - whereof goodwill 25 597 30 505 Tangible fixed assets 236 246 Financial fixed assets 19 755 19 291 - whereof purchased debt 19 054 18 483 Current assets 3 877 4 827 Non-current assets of
Slide 19: Funding base
Funding base Syndicated revolving credit facility EUR 1.1bn • SEK 1,316 M Utilized per 30 Sep 2017 Swedish MTN program 25 000 • SEK 1 bn, 5Y, issued June 2013 (margin of 2,22%) • SEK 1 bn, 5Y, issued May 2014 (margin of 1,60%) 20 000 Senior Bonds issued June 2017 • SEK 3.0bn, 5Y (stibor3m(0% floor)
Slide 20: Future Outlook
Future Outlook intrum
Slide 21: Near-term priorities
Near-term priorities Execute on current business momentum and exploit favorable market conditions • Next 12 months likely to present sizable growth opportunities • Leverage our operational and financial strength while remaining disciplined on risk/returns Continued execution of the merger integratio
Slide 22: Appendix
Appendix intrum
Slide 23: Non-recurring items (NRI's)
Non-recurring items (NRI’s) Pro forma MSEK excluding discontinued business Q1 Q2 Q3 Q4 Full-year Q1 Q2 Q3 YTD 2016 2016 2016 2016 2016 2017 2017 2017 2017 Lindorff merger transaction cost 0 0 0 -30 -30 -17 -156 0 -173 Lindorff merger integration cost 0 0 0 -1 -1 -10 -40 -45 -95 Other NRI -38 -64 -27
Slide 24: Pro forma PD carrying value and growth
Pro forma PD carrying value and growth PD carrying value: SEK 19 053 M Book Value growth y-o-y: 28% SEK M 20 000 28% 22% 15 000 22% 23% 10 000 23% 5 000 0 2012 2013 2014 2015 2016 YTD Q3 2017 Y o Y comparison 24
Slide 25: Pro forma PD Investments and ROI
Pro forma PD Investments and ROI Q3 17 RTM Investments: SEK M SEK 7 326 M 8 000 20% 266 7 000 6 000 15% 5 036 4 986 4 979 5 000 FY 1177 Q4 4 000 10% Q3 3 150 2350 1287 Q2 3 000 Q1 2 000 3 785 3 867 828 5% 3 431 537 2522* 1 000 671 934 678 867 0 0% 2012 2013 2014 2015 2016 2017 PD ROI RTM * 1st Credi
Slide 26: ERC Rolling 12 months (SEK, billions)
ERC Cash Multiple (ERC/Current BV) ERC Rolling 12 months (SEK, billions) as of 30th September 2017 = 2,11 40,2 40 000 32,7 30 000 26,6 21,2 20 000 17,6 14,3 11,3 10 000 8,9 6,9 5,3 4,0 2,9 1,9 1,1 0,6 0,5 0 26
Slide 27: Proforma PD Collections vs. Active Forecast
Proforma PD Collections vs. Active Forecast 18,0% 16,0% 14,0% 12,0% 10,0% 8,0% 6,0% 4,0% 2,0% 0,0% Q1 16 Q2 16 Q3 16* Q4 16* Q1 17* Q2 17 Q3 17 Collections vs Active Forcast per Quarter Collections vs Active Forcast R12 *The R12 numbers for these quarters have been adjusted for previously disclosed
Slide 28: Pro forma Gross Cash-on-Cash Multiple
Pro forma Gross Cash-on-Cash Multiple Vintage Purchase Price, SEK M Gross Cash-on-Cash Multiple 2008 and before 8 619 2,55 2009 1 355 2,30 2010 1 906 2,57 2011 2 648 2,32 2012 3 785 2,30 2013 3 431 2,11 2014 3 867 2,23 2015 5 036 2,12 2016 4 979 2,23 2017 4 986 1,89 Gross Cash-on-Cash Multiple: Gros
Slide 29: Upcoming IR activities
Upcoming IR activities Q3 Roadshow • Stockholm, October 18-19 • London, October 20 • Boston, October 24 • New York, October 25 • Paris and Frankfurt, October 26 Capital Markets Day • Main event: Stockholm, Dec 7 (www.intrum.com/en/investor-relations/capital-markets-day-2017) • Additional presentatio
Slide 30: Thank you
Thank you inttum