Intrum Ab · OMXSTO:INTRUM
Intrum Ab — Intrum Justitia — Q1 2007 Earnings Presentation
26 slides from Intrum Ab's earnings presentation, Apr 25, 2007
Slide 1: Intrum Justitia Group January–March 2007
Intrum Justitia Group January–March 2007 Presented by Michael Wolf, CEO, and Monika Elling, CFO April 25, 2007
Slide 2: Intrum Justitia's Change Journey
Intrum Justitia’s Change Journey Focus on client solutions is key Our aim is to drive the level of outsourcing in Europe by moving from being perceived as debt collection agency to become a client focused organisation 2
Slide 3: Solid progress
Solid progress • Profitable growth from last quarter continue • Reorganization in Sweden according to plan • Structural consolidation - Increased ownership in Intrum á Íslandi to 33% - Acquisition of Calyon 50% in the joint venture the Nordic Purchased Debt market - Acquisition of 40% minority holdi
Slide 4: Intrum Justitia sole owner of its operations in PL, CZ, SK & HU
Intrum Justitia sole owner of its operations in PL, CZ, SK & HU Poland Czech Republic Established 1998 Established 1996 IJ market position: #1 IJ market position: #1 Level of outsourcing: 10–25% Level of outsourcing: 10–25% Market growth: >10% Market growth: 0–5% Slovakia Established 2005 IJ market
Slide 5: IJ Group Q1 2007
IJ Group Q1 2007 SEK M Q1 2007 Q1 2006 Dev. % Total Revenues 757.8 709.3 6.8 Operating cost, total –617.0 –589.1 4.7 Cost of sales –445.4 –428.5 3.9 Sales & Marketing –69.0 –62.0 11.3 Administrative –102.6 –98.6 4.1 Part in associate companies 0.2 0.2 — EBIT 141.0 120.4 17.1 Net financial items –10.
Slide 6: Regional development, Sweden, Norway & Denmark
Regional development, Sweden, Norway & Denmark Market share > 25% - The reorganising from seven service lines to 10–25% two client lines, B2B and B2C, has been implemented. - Reorganization costs of SEK 4.6M is included, staff was reduced by 14 persons. We are slightly ahead of plan to net realise S
Slide 7: Regional development, The Netherlands, Belgium & Germany
Regional development, The Netherlands, Belgium & Germany Market share > 25% - The contribution arrives across the region, with the < 10% strongest momentum in Germany. - Investments in the Dutch operational efficiency continues. - The large German bank portfolio acquired in 20% July 2006 continues t
Slide 8: Regional development, Switzerland, Austria & Italy
Regional development, Switzerland, Austria & Italy Market share > 25% - Switzerland represents one of the Group’s strongest < 10% countries. An appreciated analysis, “Swiss Debtor Index” was recently released, proving IJ expertise in Switzerland. - Austria, Germany and Switzerland have well 14% deve
Slide 9: Regional development, France, Spain & Portugal
Regional development, France, Spain & Portugal Market share 10–25% - Although difficult comps, the trend of double digit revenue growth rates continues. - The EBIT expansion is back on track. - A continued positive momentum in new business and further development of processes is 16% expected to have
Slide 10: Regional development, Finland, Estonia, Latvia & Lithuania
Regional development, Finland, Estonia, Latvia & Lithuania Market share > 25% - Finland continues its double digit growth trend. 10–25% Finland has been successful in addressing both the outsourced and non-outsourced market. - The EBIT margin in Finland has a highly seasonal pattern. 13% Percentage
Slide 11: Regional development, United Kingdom & Ireland
Regional development, United Kingdom & Ireland - The region is on the right track although negative Market share 10–25% earnings in Q1. -The restructuring continue with presently SEK 45M in total annual cost reductions. In Q1 alone a further reduction of net 10 persons has taken place. The move to L
Slide 12: Regional development, Poland, Czech Rep., Slovakia & Hungary
Regional development, Poland, Czech Rep., Slovakia & Hungary Market share > 25% - Key in Q1 is the Group’s acquisition of the 10–25% 40% minority interest. - Earnings are less predictable in this region as the case inflow are heterogeneous and start-up costs and collection commission easily arrives
Slide 13: Purchased Debt
Purchased Debt - PD investments in Q1(07) was SEK 116,9M vs SEK 138,4M in Q1(06). - Net revenue and EBIT impact of write-ups and write-downs positive SEK 10.2M. - No. of portfolios at end of Q1: 1,320 in a total of 20 countries. 12% -The PD book value as of Q1 (07) was SEK 1,364.8M (934,1), a 46.1%
Slide 14: Accounting for purchased portfolios
Accounting for purchased portfolios SEK M Q1 2007 Gross collection 240.8 Amortization –107.3 Reported revenues 133.5 Commission + service line costs –69.8 Operating earnings (EBIT) 63.7 EBIT margin 47.7% 14
Slide 15: Segmental distribution of portfolios
Segmental distribution of portfolios Other, 11% (14) Mail order, 1% (2) Telecom, 10% (14) Bank loan, 48% (40) Finance, 11% (14) Credit card, 19% (29) Distribution of portfolios by purchase price, end of March 2007 (end of March 2006) 15
Slide 16: A broad indication going forward
A broad indication going forward Book value 31 Dec 2006: SEK 1,318 M => + 41% y-o-y (SEK 933 M) Gross collection: Book value x 2 Cash flow distribution of Gross collection 2006 (31%) 2007 27% (20%) 2008 19% (15%) 2009 14% (12%) 2010 11% (8%) 2011 8% (6%) A slightly higher mix 2012 6% (4%) of bank po
Slide 17: Credit Management Services
Credit Management Services -As of Q1 2007 we start to report and comment on Credit Management Services besides our comments on Purchased Debt. - This new segment is a merger of historic figures in Consumer Collection & Debt Surveillance, Commercial & International Collection and 88% Other Services.
Slide 18: Cash flow statement – Q1 2007
Cash flow statement – Q1 2007 SEK M Q1 Q1 Dev. 2006 2005 Dev. 2007 2006 % % Operating earnings (EBIT) 141.0 120.4 17.1 586.7 503.6 16.5 Income tax paid –44.3 –39.2 13.0 –164.5 –74.7 120.2 Change in working capital –27.6 –19.5 n/a 7.6 –5.5 n/a Cash flow from operating 85.7 69.9 22.6 463.7 527 –12.0 a
Slide 19: Balance Sheet – Highlights
Balance Sheet – Highlights SEK M 31 Mar 31 Mar Dev.% 2007 2006 Total assets 4,607.2 4,194.2 9.8% Goodwill 1,557.3 1,563.6 –0.4% Total financial fixed assets 1,440.6 969.8 48.5% where of Purchased Debt 1,364.8 934.1 46.1% Shareholders’ equity 1,660.5 1,392.6 19.2% Net debt/equity ratio. % 86.1 84.2 –
Slide 20: Trends from Q4(06) continue into Q1(07)
Trends from Q4(06) continue into Q1(07) • Southern Europe continues its stellar performance with 7 consecutive quarters with double digit growth… • … and so does Finland with strong profitable growth • Germany is making solid progress and benefiting from the regionalisation with Switzerland and Aust
Slide 21: Intrum Justitia Group
Intrum Justitia Group Europe’s leading Credit Management Services company Disclaimer: Except for the historical information contained herein, the matters discussed in this presentation include forward looking statements that involve risk and uncertainties that could cause actual results to differ ma
Slide 22: Financial calendar 2007
Financial calendar 2007 • Annual General Meeting in Stockholm April 25, 2007 • Capital Markets Day in Helsinki May 22, 2007 • Interim Report January–June 2007 July 26, 2007 • Interim Report January–September 2007 November 8, 2007 22
Slide 23: Shareholders' structure, March 30
Shareholders’ structure, March 30 Ten largest shareholders = 46.9% Number of Capital and No of shares: 77,956,251 shares votes, % Landsbanki Íslands 9,129,784 11.7 Cevian Capital 7,846,494 10.1 Lannebo Funds 4,281,910 5.5 Swedbank Robur Funds 3,248,409 4.2 Parkerhouse Investments 3,000,000 3.8 SEB F
Slide 24: Purchased Debt Investments 2001–2006
Purchased Debt Investments 2001–2006 SEK M 1000 900 800 700 600 500 870 400 822 300 200 258 267 100 201 106 0 2001 2002 2003 2004 2005 2006 24
Slide 25: Purchased Debt book value 2001–2006
Purchased Debt book value 2001–2006 SEK M 1400 1200 1000 800 1318 600 933 400 200 313 340 391 225 0 2001 2002 2003 2004 2005 2006 25
Slide 26: Balance Sheet – Highlights
Balance Sheet – Highlights SEK M 31 Mar 30 Dec Dev.% 2007 2006 Total assets 4,607.2 4,461.5 3.3% Goodwill 1,557.3 1,524.4 2.2% Total financial fixed assets 1,440.6 1,382.4 4.2% where of Purchased Debt 1,364.8 1,317.9 3.6% Shareholders’ equity 1,660.5 1,492.6 11.2% Net debt/equity ratio. % 86.1 98.1