Vef Ab · OMXSTO:VEFAB
Vef Ab — Vostok Emerging Finance — Q4 2016 Earnings Presentation
31 slides from Vef Ab's earnings presentation, March 2017
Slide 1: Investor Presentation 4Q / FY16 Results
Investor Presentation 4Q / FY16 Results
Slide 2: 4Q16 financial highlights
4Q16 financial highlights Positive net result for the period: 4Q16 was USD 21.4 mln and EPS was USD 0.03. FY16 net result to USD 48.7 mln and FY16 EPS of USD 0.07. Positive net result in the quarter is primarily driven by positive share price development in TCS (only listed holding), which i
Slide 3: 4Q Report 2016: Income Statement
4Q Report 2016: Income Statement (USD thousands) January 1, 2016– October 1, 2016– December 31, 2016 December 31, 2016 Results from financial assets at fair value 48,141 20,847 Dividend and coupon income 3,031 1,601 Total Operating Income 51,172 22,448 Operating expenses -2,031 -658 Operating result
Slide 4: 4Q Report 2016: Statement of Financial Position
4Q Report 2016: Statement of Financial Position (USD thousands) December 31, 2016 December 31, 2015 Financial non-current assets 120,155 34,768 Current assets 25,027 62,327 Total assets 145,182 97,095 Equity 144,326 95,548 Trade payables – 1,491 Other current liabilities 732 21 Accrued expenses 124
Slide 5: Reflecting on 2016, we summarise our key achievements
Reflecting on 2016, we summarise our key achievements … We began the year on the front foot having just closed a successful rights issue in December 2015, raising SEK 588 mln Started the year with 4 portfolio companies across 2 geographies, we ended 2016 with 7 portfolio companies across 5 geogr
Slide 6: An eventful and positive start to 2017
… and have followed this up with an eventful and positive start to 2017: We have made follow on investments into portfolio companies Jumo and REVO/Sorsdata. The REVO/Sorsdata transaction was a benchmark transaction as we welcome Baring Vostok, Russia’s leading PE house, who led a USD 20 mln fund
Slide 7: Portfolio
Portfolio % of 28 Feb 2017 Investment Company Geography Business Type Portfolio Fair value ($) year Russia Digital Banking 42.9% 63,797,940 2007 Russia Payments & Consumer Credit 9.5% 14,153,151 2015 Africa Mobile Money Marketplace 8.6% 12,705,768 2015 Brazil Consumer Credit Marketplace 0.8% 1,106,1
Slide 8: Portfolio commentary
Portfolio commentary VEF Portfolio as at February 28, 2017 NAV $148.2m • We have 7 holdings in the portfolio today plus cash • Tinkoff CS remains our largest holding given recent performance Cash / Liquid Assets 29% • Strong cash position is a key a TCS Group strength of our business and leaves us 4
Slide 9: Portfolio distribution by geography
Portfolio distribution by geography By Geography By Geography (ex TCS) Brazil Pakistan Brazil Pakistan 1% 1% 3% 2% Emerging Turkey Europe 9% 3% Turkey Russia Africa 22% 34% 12% Russia Emerging 74% Europe 8% Africa 31% >9
Slide 10: Portfolio distribution by business type
Portfolio distribution by business type By Business Type By Business Type (ex TCS) Mobile Money 1% Marketplace 13% Payments Marketplace 30% Credit 13% 34% Digital Payments Banking 12% 61% Mobile Money Credit 2% 34% >10
Slide 11: VEF share price and NAV evolution
VEF share price and NAV evolution NAV Rights Issue Share Price 1.90 1.70 1.50 SEK 1.30 1.10 0.90 Date Latest Share NAV / Share Discount NAV (USD mn) Market Cap Market Cap Price (SEK) (SEK) (SEK mn) (USD mn) 28/02/2017 1.73 2.03 14.6% 148.2 1,144.4 126.6 >11 11
Slide 12: VEF shareholder structure
VEF shareholder structure Largest Shareholders Owner Holding, SDRs Holding, % Libra Fund 154,000,000 23.3% Fidelity FMR 66,149,599 10.0% Swedbank Robur Funds 57,674,245 8.7% Fidelity FIL 47,961,763 7.3% Wellington Management 36,281,441 5.5% Alecta Pension Insurance 34,250,000 5.2% Ruane Cunniff 32,9
Slide 13: At Vostok Emerging Finance, we invest in some of the most exciting fintech companies
“At Vostok Emerging Finance, we invest in some of the most exciting fintech companies in developing markets” Within emerging and frontier markets, we focus on the more populous and scalable Geography markets cross referenced against competition for opportunities We target all lines of financial serv
Slide 14: Where Emerging Markets meet fintech
Where Emerging Markets meet fintech Consumer Offline Saas PAYMENTS CREDIT OTHER SME Online Wealth Management P2P Mobile Digital Banks Credit Scoring Remittances Equity Crowdfunding Comparison Websites Qualified Leads Insurance >14
Slide 15: Created post Vostok Nafta split
Created post Vostok Nafta split VNV portfolio VEF portfolio (1997–2015) (2015+) (2015+) >15
Slide 16: History and recent highlights
History and recent highlights Investment: Incorporated Successful Investment: Investment: Revo / and listed on rights issue Sorsdata Nasdaq First raising SEK FinanZero Finja ($5mn) North, 588mn / ($1.2mn) ($1.0mn) Sweden $70mn Iyzico ($9mn) Jul ‘15 Sep ‘15 Dec ‘15 Dec ‘15 Mar ‘16 Jun ‘16 Aug ‘16 Dec
Slide 17: Board of Directors
David Nangle Board of Lars O Grönstedt Per Brillioth Directors Voria Fattahi Milena Ivanova Chairman of the Board Board Member Board Member Board Member Experience: Experience: David Nangle Experience: Experience: • Chairman and MD of • MD of Vostok New • Investment Director • Renaissance Capital Ha
Slide 18: The Portfolio
>EF Vostok Emerging Finance The Portfolio >18
Slide 19: Portfolio
Portfolio % of 28 Feb 2017 Investment VEF Portfolio as at Feb 28, 2017 Company Portfolio Fair value, $ year NAV $148.2m 42.9% 63,797,940 2007 Russia 9.5% 14,153,151 2015 Cash / Liquid Assets Africa 8.6% 12,705,768 2015 29% TCS Group 43% LatAm 0.8% 1,106,164 2016 Emerging Iyzico Europe 2.2% 3,176,098
Slide 20: Tinkoff Bank
Tinkoff Bank • Business Type: Digital Banking Recent highlights Key • Founded: 2006 Year of investment: 2007 Facts • Ownership Stake: 3.5% • RoAE in 4Q16 rose to 51.4% from a high 43.4% in the • Key region: previous quarter A market still dominated by old world financial • A new dividend policy anno
Slide 21: Tinkoff Bank
Tinkoff Bank Major changes in Russian retail finance, Tinkoff is #2 credit card issuer in Russia and growing driven by: market share • Economic situation • The regulator + • New technology Tinkoff.ru – the concept Tinkoff.ru – the concept Unique Opportunity: • Smoothen cyclicality of credit business
Slide 22: Tinkoff Bank
Tinkoff Bank Net income (RUBbn) Return on assets Profit at RUB 3.7bn in 4Q16 8.7% 11.0 7.1% 6.8% 7.3% 5.3% 1.5% 2.9% FY'15 FY'16 4Q'15 1Q'16 2Q'16 3Q'16 4Q'16 Return on equity 51.4% 3.7 32.3% 2.9 42.5% 2.5 41.5% 43.4% 1.9 1.9 16.7% 0.9 8.6% FY'15 FY'16 4Q'15 1Q'16 2Q'16 3Q'16 4Q'16 FY'15 FY'16 4Q'15
Slide 23: REVO
REVO • Type: Merchant payments / consumer credit Key Merchant Partners Key • Founded: 2012 Year of investment: 2015 Facts • Ownership Stake: 25% 64.5% • Key region: Works with Russia’s on and offline merchants at 1 POS to increase conversion and basket size Focus on small ticket categories with $100
Slide 24: REVO
REVO Metrics Dec 2014 Dec 2015 Mar 2016 Jun 2016 Sep 2016 No. of active stores 572 1,620 1,970 1,833 1,998 No. of installments granted 9,969 41,217 51,774 39,220 58,344 Avg. installment plan (Rub) 3,852 4,103 4,225 4,087 4,436 Avg. duration of installment plan (months) 4.9 4.6 4.7 4.8 4.9 Avg. APR o
Slide 25: JUMO
JUMO • Type: Mobile Money Marketplace Key • Founded: 2013 Year of investment: 2015 Facts • Ownership Stake: 7.6% • Key region: FINANCIAL SERVICE PROVIDERS Mobile money marketplace for individuals and JUMO 1 FSPs small businesses Capital Focus on key mobile money markets of Africa and 2 beyond JUMO M
Slide 26: TransferGo
TransferGo • Type: Cross Border Remittances Key • Founded: 2012 Year of investment: 2016 Global Remittance Volumes ($bn) Facts • Ownership Stake: 9.8% $800.00 • Key region: $700.00 Low cost cross border remittance provider 1 focusing on Western to Eastern Europe $600.00 $268.00 Targeting blue-collar
Slide 27: TransferGo
TransferGo Metrics Sep 2015 Dec 2015 Mar 2016 Jun 2016 Sep 2016 Dec 2016 No. of active users* 22,300 27,800 32,522 37,645 40,461 51,792 Money flow (GBP mn) 6.3 7.1 9.8 15.3 14.4 19.0 Avg. ticket size (GBP) 270 240 269 370 370 335 Active Users*, # Monthly Money Flow, GBP 55000 21 50000 19 45000 17 40
Slide 28: FinanZero
FinanZero • Type: Consumer Loan Marketplace Key • Founded: 2016 Year of investment: 2016 Facts • Ownership Stake: 20% • Key region: Pioneering marketplace for consumer loans in 1 OLX Other Digital Leads Brazil Partnered with range of banks and credit 2 institutions offering most suitable loans for c
Slide 29: Iyzico
Iyzico • Type: Payment Processor Key Merchant Partners Key • Founded: 2012 Year of investment: 2017 Facts • Ownership Stake: 20% • Key region: Leading Turkish payment solution provider for 1 online retailers Has over 8,500 live merchants and 160,000 seller 2 accounts under marketplaces Turkey is Eur
Slide 30: Outlook and Guidance
>EF Vostok Emerging Finance Outlook and Guidance >30
Slide 31: Opportunities and outlook for 2017
Opportunities and outlook for 2017 Pipeline continues to be healthy, balancing current portfolio needs … with adding new names A lot of focus to date on the EMEA region but we are seeing an … increasing number of opportunities in Latin America Well on track to deliver on our target of building a por
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