Slide 1: Presentation Q3 2024
AXACTOR Presentation Q3 2024
Slide 2: Highlights, Financial update, Outlook, Q&A
Highlights Financial update Outlook Q&A
Slide 3: Financial highlights for the quarter
Financial highlights for the quarter Gross revenue increasing by 2% y-o-y • Declining by 3% adjusted for a minor EUR 4m portfolio sale in Spain Cash EBITDA increasing by 6% y-o-y • Strict cost control in all markets offset inflation pressure Healthy EBITDA margin of 48% • EBITDA of EUR 27m, down fro
Slide 4: Accretive investments drives gross IRR to all time high
Accretive investments drives gross IRR to all time high - Expect to ramp up investments from Q3 to Q4 NPL investments and Gross IRR on the total NPL book (EUR million, %) NPL Investments Gross IRR 100 18.7% 19% 17.8% 18% 75 16.8% 17% 50 16.1% 93 15.7% 80 16% 69 70 25 54 47 15% 40 32 33 19 24 16 12 1
Slide 5: Strict cost control enables a reduction in total operating expenses of 5% y-o-y
Strict cost control enables a reduction in total operating expenses of 5% y-o-y, despite inflationary pressure Total operating expenses (EUR million) 32 32 32 -5% 31 Total operating expenses down 5% y-o-y 30 30 • Total operating expenses down 8% y-o-y 29 29 adjusted for restructuring cost in Italy 2
Slide 6: On track to deliver on key cost reduction projects
On track to deliver on key cost reduction projects • Closure of the office in Cuneo was announced on 1 July affecting approximately 100 employees in Italy • All employees offered to relocate to the three competence Site consolidation centers for the future in Italy • Milazzo – Amicable collection •
Slide 7: Axactor will benefit materially if interest rates continue to decline
Axactor will benefit materially if interest rates continue to decline EURIBOR 3 months (Jan ’20 – Sep ’24)1 4% Axactor is exposed to changes in interest rates • Hedging ratio expected to increase in line with portfolio 3% investments going forward Status on interest rate hedges 2% • 8% of net intere
Slide 8: Highlights, Financial update, Outlook, Q&A
Highlights Financial update Outlook Q&A
Slide 9: Group: Gross revenue is up 2% y-o-y
Group: Gross revenue is up 2% y-o-y Gross revenue (EUR million) +3% +2% 89 91 89 84 85 86 82 83 13 15 79 13 13 13 13 13 15 12 • Gross revenue is up 2% y-o-y • NPL gross revenue increasing by 2% y-o-y • 3PC gross revenue is flat y-o-y 74 78 72 76 73 69 70 70 67 • NPL gross revenue supported by a port
Slide 10: NPL segment: Total income is down y-o-y driven by higher amortizations and revaluations
NPL segment: Total income is down y-o-y driven by higher amortizations and revaluations NPL Total income and CM% (EUR million, and %) • Total income down y-o-y on the back of +13% macroeconomic headwinds -18% 52 52 • Includes net neg. revaluations of EUR 7m 48 49 50 46 45 46 42 • Portfolio amortizat
Slide 11: 3PC segment: Underlying positive development on both the top line and margins
3PC segment: Underlying positive development on both the top line and margins 3PC Total income and CM% (EUR million and %) -3% 0% 15 15 13 13 13 13 13 13 12 • 3PC total income flat y-o-y • 6% growth excluding the closure of 3PC in 46% Sweden and Finland 41% 35% 36% 37% 31% 33% 33% 32% • Margins up f
Slide 12: Group: Total income and EBITDA under pressure whilst Cash EBITDA is growing by 6% y-o-y
Group: Total income and EBITDA under pressure whilst Cash EBITDA is growing by 6% y-o-y Total income EBITDA and EBITDA-margin Cash EBITDA (EUR million) (EUR million and %) (EUR million) +9% -15% 51% 54% 53% 65 65 51% 63 62 64 49% 49% 50% 48% +6% 59 59 34 34 46% +2% 57 55 33 61 30 31 30 30 58 60 59 5
Slide 13: ROE of 3% last twelve months
ROE of 3% last twelve months – impacted by increased cost of funding and a challenging collection environment Return on equity to shareholders (%) 9% 7% 6% 3% 1% 2% -6% -6% -9% 2016 2017 2018 2019 2020 2021 2022 2023 LTM Q3-24 13
Slide 14: Highlights, Financial update, Outlook, Q&A
Highlights Financial update Outlook Q&A
Slide 15: Outlook
Outlook • Experience a challenging collection environment which is expected to 1 Collection prevail throughout 2024 and into 2025 • Absorbed inflation and achieved OPEX reduction y-o-y last four 2 OPEX quarters. Expect to be able to continue the trend • Expect only modest reduction in cost of fundin
Slide 16: Highlights, Financial update, Outlook, Q&A
Highlights Financial update Outlook Q&A
Slide 17: Supporting information
Supporting information
Slide 18: NPL investment commitments of EUR 4m next 12 months
NPL investment commitments of EUR 4m next 12 months Quarterly NPL investments (EUR million) 93 69 70 40 33 Additional forward 24 flow agreements and 19 one-off acquisitions 11 13 expected to further 2 2 0 0 increase NPL investments Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 ’22 ’22 ’23 ’23 ’23 ’23 ’24 ’
Slide 19: ERC has been stable last twelve months
ERC has been stable last twelve months ERC development Forward ERC profile by year (EUR million) (EUR million) +1% 2,664 2,602 328 320 2,545 2,523 2,563 2,586 2,620 2,555 2,367 296 256 224 192 171 154 138 123 102 90 79 70 61 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Y1 Y2 Y3 Y4 Y5 Y6 Y7 Y8 Y9 Y10 Y11 Y12 Y13 Y14 Y
Slide 20: 3PC volumes by geographic region
3PC volumes by geographic region 3PC Total income split by geographic region 13% Q3’24 • Spain accounting for 52% of total income on 3PC Total income 21% 52% EUR 12.8m • Segment closed down in Finland and Sweden, with no active clients per year-end 2023 14% DEU ITA NOR ESP 20
Slide 21: Bond covenants (1/2)
Bond covenants (1/2) Leverage ratio - covenant ≤4.0x Interest coverage ratio - covenant ≥3.0x (Net interest-bearing debt divided by LTM Pro-forma adjusted cash EBITDA) (Pro-forma adjusted cash EBITDA divided by net interest expenses) 4.0 3.0 4.0 5.2 5.0 3.9 3.9 4.6 3.8 3.8 3.8 4.2 3.8 3.8 3.5 3.2 3.
Slide 22: Bond covenants (2/2)
Bond covenants (2/2) Loan-to-value - covenant ≤80% Secured Loan-to-value - covenant ≤60% (Net interest-bearing debt divided by total portfolio book value) (Secured net interest-bearing debt divided by total portfolio book value) 80% 60% 75% 73% 74% 73% 73% 73% 73% 73% 72% 37% 38% 39% 37% 37% 35% 35%
Slide 23: Terms and abbreviations
Terms and abbreviations Abbreviations 3PC Third-party collection AGM Annual general meeting APM Alternative performance measures ARM Accounts receivable management B2B Business to business Terms B2C Business to consumer Active forecast Forecast of estimated remaining collection on NPL portfolios BoD
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