Credit Corp Group Limited · ASX:CCP

Credit — Investor Presentation (April 2022)

17 slides from Credit's investor presentation, Apr 26, 2022

  1. Slide 1: Credit Corp Group: Building Momentum

    Cc Credit Corp Group BUILDING _ MOMENTUM

  2. Slide 2: Leadership across separate markets comprising the credit impaired consumer segment

    Leadership across separate markets comprising the credit impaired consumer segment… For personal use only ANALYTICS & DISCIPLINE OPERATIONAL EXCELLENCE SUSTAINABILITY & COMPLIANCE Australian / NZ debt buying  Large database  High asset turnover 1  No adverse orders or undertakings  History of pr

  3. Slide 3: Flexibility to adapt to challenging market conditions

    … has provided flexibility to adapt to challenging market conditions For personal use only Business segment Market conditions Response AUS/NZ debt buying  Reduced direct from issuer sale  Apply differentiated sustainability and compliance volumes position to maximize share in a diminished market 

  4. Slide 4: Reduced direct from issuer sale volumes are impacting AUS/NZ collections

    Reduced direct from issuer sale volumes are impacting AUS/NZ collections… For personal use only  Direct from issuer volumes averaging 55 per cent of pre-COVID 5 year average  One-offs have filled the gap  Acquired payment arrangements now running off AUS/NZ PDL INVESTMENT AUS/NZ COLLECTIONS $250m

  5. Slide 5: Data does not suggest a recovery in AUS/NZ sale volumes

    … and the data does not suggest a recovery in AUS/NZ sale volumes For personal use only  Unsecured credit balances 36 per cent down on pre-COVID levels  Loss rates remain at historic lows AUS INTEREST BEARING CONSUMER CREDIT CARD AUS BANK CREDIT CARD 90+ DAYS PAST DUE RATES 2 BALANCES 1 1.4% $30bn

  6. Slide 6: Increased share is driving US investment growth

    Increased share is driving US investment growth … For personal use only  Initial 50 per cent reduction in charge-off volumes due to pandemic 1  Additional allocation from existing sale clients supplemented with new relationships US PURCHASING (A$m) $200m $150m $100m $50m $0m FY2018 FY2019 FY2020 F

  7. Slide 7: … and will drive earnings growth

    … and will drive earnings growth For personal use only  Labour market challenges are suppressing the conversion of purchasing into earnings in the current year  Measures in place:  Philippines shift to commence in July-22  Improved analytics to identify accounts for legal outsourcing  Increased

  8. Slide 8: Strong signs of increased US PDL supply

    Strong signs of increased US PDL supply For personal use only  Unsecured credit balances now recovered to pre-COVID levels  Purchase volumes on some forward flows have already increased by 15 per cent in recent months US REVOLVING CREDIT MARKET US UNSECURED CREDIT BALANCES 3 $ 900bn 5% $1,200bn $

  9. Slide 9: Loan volume now exceeding pre-pandemic levels

    Loan volume now exceeding pre-pandemic levels … For personal use only  Strong recovery from Nov-21  Credit settings at pre-COVID levels  Increased new and returning customer volume  ‘Above-the-line’ advertising resumed for the June quarter to capture the opportunity CONSUMER LENDING SETTLEMENTS

  10. Slide 10: Driving the book towards its pre-COVID peak

    … driving the book towards its pre-COVID peak For personal use only CONSUMER LENDING BOOK AND REVENUE $ 230m $ 230m $ 218m $ 212m $ 200m $ 181m $ 184m $ 176m $ 172m $ 168m $ 153m  Demand recovered with March quarter application volume $ 107m exceeding the prior year  New customer loan amounts exce

  11. Slide 11: FY2022 net lending and ledger investment guidance upgraded

    FY2022 net lending and ledger investment guidance upgraded For personal use only FY2022 guidance 23 Feb 2022 Upgraded 26 Apr 2022 Ledger investment $320 - $330 million $345 - $355 million Net lending $45 - $55 million $70 - $75 million NPAT $92 - $97 million 1 $92 - $97 million 1 EPS (basic) 137 - 1

  12. Slide 12: Appendices: Key Operating Metrics

    For personal use only Appendices: Key Operating Metrics Appendix 1: Pricing discipline and accuracy Appendix 2: Collections life cycle Appendix 3: Productivity Appendix 4: Payers base Appendix 5: Operational and total headcount Credit Corp Group Market Update Credit Corp Team Update 2020 I 12 12 Cre

  13. Slide 13: Pricing discipline and accuracy

    APPENDIX 1 Pricing discipline and accuracy For personal use only PRICING DISCIPLINE AND ACCURACY Cumulative collections $ 5.0b $ 4.0b Actual cash collections $ 3.0b $ 2.0b $ 1.0b Initial projections 1 - 1. For all PDLs held at June 2008, initial projections represent the forecast at June 2008 Credit

  14. Slide 14: Collections life cycle

    APPENDIX 2 Collections life cycle For personal use only PDL COLLECTIONS BY VINTAGE 9%1 $ 160m $ 140m $ 120m 30% 31% 33% 29% 34% 32% 34% $ 100m 29% 30% 30% 34% 32% 19% 31% 32% 14% 16% 15% $ 80m 30% 32% 32% 33% 18% 17% 16% 11% 13% 14% 16% 16% $ 60m 17% 17% 15% 15% 10% 23% 18% 15% 12% 22% 21% 25% 23% 1

  15. Slide 15: Productivity

    APPENDIX 3 Productivity For personal use only PDL COLLECTIONS PER HOUR $ 350 YTD Mar-22 average $ 300 12m to Mar 22 FY2022: $307 $ 250 1 $ 200 12m to Mar-21 FY2021: $288 1 $ 150 $ 100 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar 1. Prior year restated for FY2022 YTD average exchange rate Credit C

  16. Slide 16: Payers base

    APPENDIX 4 Payers base For personal use only PORTFOLIO SUMMARY: AU/NZ DEBT BUYING ONLY Total portfolio Jun-19 Dec-19 Jun-20 Dec-20 Jun-21 Dec-21 Mar-22 Face value $6.4b $7.8b $7.7b $8.6b $8.5b $7.9b $7.7b Number of accounts 786,000 1,268,000 1,193,000 1,392,000 1,326,000 1,252,000 1,185,000 Payment

  17. Slide 17: Operational and total headcount

    APPENDIX 5 Operational and total headcount For personal use only PERIOD END HEADCOUNT (FTE) PERIOD END HEADCOUNT (FTE) 2,000 Dec-20 Jun-21 Dec-21 Mar-22 1,800 Debt buying 1,600 1,281 1,261 1,285 1,319 operations 1,400 Agency 222 218 223 222 1,200 1,000 Lending 110 111 129 132 800 Support 137 143 147

Credit Corp Group — Investor Presentation (April 2022) on 6ix