Contact Financial Holding Sae · EGX:CNFN
Contact Financial Holding Sae — Contact Financial Holding — 9M 2024 Earnings Presentation
46 slides from Contact Financial Holding Sae's earnings presentation, 2024
Slide 1: Results Presentation 9M-2024
Results Presentation 9M-2024
Slide 2: Disclaimer
Introduction Disclaimer This presentation has been prepared by Contact Financial Holding (the “Company”. The distribution of this presentation in certain jurisdictions may be restricted by law and persons into whose possession this presentation comes should inform themselves about, and observe, any
Slide 3: Agenda
AGENDA 1 Introduction 4 2 Our Edge 7 3 Digital Platforms 20 4 Debt Capital Markets 25 5 Africa Expansion 28 6 9M-2024 Performance Review 30 7 Appendix 43
Slide 4: Introduction
ion Introduct ~
Slide 5: At a Glance
Introduction At a Glance Egypt’s leading non-bank financial services provider Group Structure 1st EGX Consumer Finance License in Egypt with +20yrs and Largest Consumer Finance Player in the Listed Since 2018 Under the Ticker CNFN.CA Market Offering Innovative Financial Services Financial Holding EG
Slide 6: Results Snapshot
Introduction Results Snapshot Strong results at the insurance division, coupled with the recovery in the financing segment’s results during 3Q-2024 following a pickup in demand during the quarter, evidenced by the quarter-on-quarter increase in new lending enabled Contact to deliver a resilient perf
Slide 7: Our Edge
Our Edge
Slide 8: How We Differentiate Ourselves
Our Edge How We Differentiate Ourselves Highly experienced management Highly team Targets the profitable banked & operation unbanked population Contact has a clear vision for the business with a well- Superior Widest product defined growth strategy to funding capabilities offering in the market achi
Slide 9: Well-Defined Growth Strategy
Our Edge – Well-Defined Growth Strategy Well-Defined Growth Strategy Contact has a clear vision for the business with a well-defined growth strategy to achieve it Contact Today A B C D E The widest product Fully digitized proprietary Strong physical & digital Superior funding Highly profitable offer
Slide 10: What We Do
Our Edge – What We Do What We Do Contact is Egypt’s largest non-bank financial services provider and has been actively changing the way businesses and individuals access financial and insurance services over the past twenty years. Financing 79% Insurance 21% Financing products targeting Egypt’s bank
Slide 11: Diversified and Synergistic Product Base Driving Growth Across All Segments
Our Edge – Diversified Product Base Diversified and Synergistic Product Base Driving Growth Across All Segments Broad & Increasingly Diversified Consumer Finance Offering New Lending Breakdown by Product for 2019 New Lending Breakdown by Product for 9M-2024 4% 2% 3% 2% 6% 10% 8% 4% 15% 2% 55% 75% 16
Slide 12: Proprietary AI Instant Credit Scoring Engine
Our Edge – Exceptional Credit Scoring Engine Proprietary AI Instant Credit Scoring Engine Unique Credit Assessment Approach through Creditech Distinctive credit assessment methodology refined over +20 years of financing experience Loan disbursed or application Credit application submitted Data asses
Slide 13: Wide Market Coverage
Our Edge – Wide Market Coverage Market-wide Coverage Including Banked and Unbanked Population Powered by Physical Presence … Expanding the branch network in high-potential areas outside the main cities Wide Geographical Footprint took place throughout 2021, 2022, 2023, and 2024 Zamalek Sharm El Shei
Slide 14: A Diversified Digital Distribution Network
Our Edge – Wide Market Coverage … And A Diversified Digital Distribution Network Direct to Consumer Distribution (DTC) Lending as a Service (LaaS) 14
Slide 15: A Digital One-Stop-Shop for all Financial Needs
Our Edge – A Digital One-Stop-Shop A Digital One-Stop-Shop for all Financial Needs Relaunched in January 2023, the ContactNow app is Egypt’s first fully-fledged app offering the full suite of digital financial solutions A Digital One-Stop-Shop Covering the Consumer’s Financial Lifecycle Strategic Ad
Slide 16: 20+ Years of Strong Track Record of Credit Extension & Collection
Our Edge – Solid Track Record 20+ Years of Strong Track Record of Credit Extension & Collection Track Record of Growth and Operational Evolution Rise Up Successful product deployment on the back of market know-how LaaS Insurance Insurance Credit Credit Specialized Specialized Consumer Credit Consume
Slide 17: Diversified, Highly Liquid Funding Base
Our Edge – Diversified Funding Base Diversified, Highly Liquid Funding Base Funding Strategy Overview Overview of 9M-2024 Funding Base Amounts in EGP MN Utilized Available Diversified funding base enabling 27,744 consistent liquidity with efficient pricing A B C D E 7,848 Fixed rate to match portfol
Slide 18: Funding Driven by Continued Innovation in the DCM Space
Our Edge – An Innovator in the DCM Space Funding Driven by Continued Innovation in the DCM Space1 Overview of Debt Capital Markets Activities DCM Segment Highlights • Originally established to deepen Egypt’s debt capital markets and further enhance the Group’s availability and cost of funding, Conta
Slide 19: Consistent Growth and Expansion
Our Edge – Historical Performance Consistent Growth and Expansion Through its growing digital presence, as well as its increasingly broad reach and service offering, underpinned by its ever- expanding insurance offering, Contact is able to overcome difficult market conditions and a challenging macro
Slide 20: Digital Platforms
Digital Platforms -
Slide 21: A Digital Business
Digital Platforms A Digital Business Through strategic investments and partnerships, Contact is continuously strengthening its digital capabilities, placing it at the forefront of the financing and insurance sectors’ digitization movement Increase Create new Maintain market Contact’s Improve Retain
Slide 22: Digital Platforms – Contactcars.com
Digital Platforms – Contact Cars Digital Platforms – Contactcars.com The portal, originally set up in 2002, was relaunched in 2021 as a stand-alone business ContactCars.com Relaunched In 3Q-2024, Contactcars.com introduced the "Otlobha" product, which helps consumers locate the desired car at the be
Slide 23: Digital Platforms – ContactNow
Digital Platforms – ContactNow Digital Platforms – ContactNow The Company rolled out its ContactNow app in early 2021 (relaunched in 2023) with the platform rapidly rising in popularity ever since The ContactNow app Contact has integrated ContactNow entertainment services into the on Huawei Original
Slide 24: Digital Platforms – Wasla
Digital Platforms – Wasla Digital Platforms – Wasla Wasla In February 2022 Contact concluded a USD 9 million investment in e-commerce super-app, further expanding the Company’s growing footprint in fintech and reinforcing its quest to enable tech-first ventures in Egypt’s financing ecosystem Wasla a
Slide 25: Debt Capital Markets
Debt Capital Markets
Slide 26: Overview of the Debt Capital Markets
Debt Capital Markets Overview of the Debt Capital Markets1 Overview of Debt Capital Markets Activities DCM Segment Highlights • Originally established to deepen Egypt’s debt capital markets and further enhance the Group’s availability and cost of funding 42 • Introducing new products to the market:
Slide 27: Overview of the Debt Capital Markets
Debt Capital Markets Overview of the Debt Capital Markets Egypt’s Leading DCM Player with a Proven Record of Executing Transactions in Challenging Market Conditions, Safeguarding the Group’s Liquidity Requirements 2022 2023 2024 2022 Issued despite Issued despite Issued despite Issued despite ongoin
Slide 28: Africa Expansion
Africa Expansion
Slide 29: The Perfect Opportunity for Further Expansion
Africa Expansion The Perfect Opportunity for Further Expansion Expanding into Kenya and other emerging African markets presents a great opportunity for Contact to replicate its domestic success in markets with similar demographics. Almasi, a joint venture between Contact and Mansour Group, will init
Slide 30: 9M-2024 Performance Review
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Slide 31: Comprehensive Financing Offering
9M-2024 Performance Review Comprehensive Financing Offering 9M-2024 new lending was impacted by a restrictive interest rate environment and product price uncertainty, in addition to Contact actively managing its risk levels by tightening the credit investigation process and focusing on higher margin
Slide 32: Financing Division – Resilient Results Across Financing Segments
9M-2024 Performance Review Financing Division – Resilient Results Across Financing Segments In 9M-2024, total new financing extended fell by 31% year-on-year to reached EGP 8.35 billion, with the Consumer Finance and Auto segments witnessing the largest year-on-year contractions during the period on
Slide 33: Financing Division – Increasingly Diversified Portfolio with Favorable Margins
9M-2024 Performance Review Financing Division – Increasingly Diversified Portfolio with Favorable Margins Contact’s financing portfolio stood at EGP 20.82 billion in 9M-2024, a 6% year-on-year expansion. During the year, Contact continued diversifying its portfolio, with an added focus on higher-spr
Slide 34: Financing Division – Resilient Results Across all Financing Revenue Components
9M-2024 Performance Review Financing Division – Resilient Results Across all Financing Revenue Components In 9M-2024, the financing division’s results were impacted by an elevated interest rate environment and the prevalent price uncertainty, negatively affecting customer purchasing power, and resul
Slide 35: Financing Division – High-Quality Portfolio as Evident by the Low Delinquency Ratio
9M-2024 Performance Review Financing Division – High-Quality Portfolio as Evident by the Low Delinquency Ratio Contact’s PaR 150+ delinquencies (Portfolio at Risk) ratio as at September 2024 stood at 3.8% 150+ Days Portfolio at Risk 3.8% 3.4% 3.2% 2.5% 2.3% FY-2021 FY-2022 FY-2023 9M-2023 9M-2024 Co
Slide 36: Financing Division – Declining Profitability amidst a Difficult Operating Environment
9M-2024 Performance Review Financing Division – Declining Profitability amidst a Difficult Operating Environment Net income at the financing division shrank by 23% year-on-year in 9M-2024 on the back of Contact’s decision to slow down portfolio transfer activities due to the prevailing interest rate
Slide 37: Financing Division – Quarterly Progress
3Q-2024 Performance Review Financing Division – Quarterly Progress The financing division’s results during 3Q-2024 witnessed a significant recovery on the back of an uptick in demand during the quarter, reflected in the strong quarter-on-quarter increase in new lending New Lending| EGP mn Financing
Slide 38: Insurance Division – Operational and Business Developments – 9M-2024
9M-2024 Performance Review Insurance Division – Operational and Business Developments – 9M-2024 Gross written premiums generated by both insurance companies witnessed solid year-on-year growth following the ramp up of new product and increased cross-selling. Meanwhile, total policies underwritten in
Slide 39: Insurance Division – Performance Review
9M-2024 Performance Review Insurance Division – Performance Review Underwriting Income | EGP mn Insurance Operating Income | EGP mn 53% 17% 349 363 150 143 On a consolidated basis, 123 Underwriting income expanded 238 insurance operating income 97 by 17% year-on-year to EGP 195 reached EGP 363 milli
Slide 40: Consolidated Performance – Income Statement
9M-2024 Performance Review Consolidated Performance – Income Statement The insurance division’s positive results, coupled with the financing division’s recovery in 3Q-2024, cushioned the impact of the challenging macroeconomic environment, supporting Contact’s resilient performance for 9M-2024 Conso
Slide 41: Consolidated Performance – Income Statement
9M-2024 Performance Review Consolidated Performance – Income Statement Consolidated normalized net income after minorities fell by 12% year-on-year to EGP 477 million in 9M-2024 Normalized Net Income1| EGP mn Consolidated Return on Equity | % Adjustments Actual Net Income -12% 693 27.2% 1 609 23.6%
Slide 42: Consolidated Performance – Income Statement
3Q-2024 Performance Review Consolidated Performance – Income Statement The gradual improvement in market condition witnessed in 3Q-2024 reflected positively on the Group’s quarterly results, with consolidated performance rising strongly quarter-on-quarter Total Operating Income| EGP mn Consolidated
Slide 43: Appendix
Appendix
Slide 44: Financing Business Income Statement
Appendix Financing Business Income Statement FY-2022 FY-2023 change (FY-2022 vs FY-2023) 9M-2023 9M-2024 change (9M-2023 vs 9M-2024) Revenue from Portfolio Transfer 767,104 1,005,772 31% 836,028 537,345 -36% Off Balance Sheet Portfolio Management Fee 199,248 326,241 64% 232,040 287,130 24% Securitiz
Slide 45: Insurance Business Income Statement
Appendix Insurance Business Income Statement FY-2022 FY-2023 change (FY-2022 vs FY-2023) 9M-2023 9M-2024 change (9M-2023 vs 9M-2024) Gross Written Premiums 948,316 1,491,843 57% 1,168,772 1,756,579 50% Provisions of Unearned Premiums (105,734) (194,195) 84% (186,257) (213,767) 15% Outward Reinsuranc
Slide 46: Consolidated Income Statement
Appendix Consolidated Income Statement Financing Business FY-2022 FY-2023 change (FY-2022 vs FY-2023) 9M-2023 9M-2024 change (9M-2023 vs 9M-2024) Revenue from Portfolio Transfer 767,104 1,005,772 31% 836,028 537,345 -36% Off Balance Sheet Portfolio Management Fee 199,248 326,241 64% 232,040 287,130
Contact Financial Holding — 9M 2024 Earnings Presentation on 6ix