International Personal Finance Plc · LSE:IPF
International Personal Finance — H1 2024 Earnings Presentation
30 slides from International Personal Finance's earnings presentation, Jul 31, 2024
Slide 1: Delivering growth and returns
2024 half-year results Delivering growth and returns 31 July 2024
Slide 2: Performance and strategy
Performance and strategy Gerard Ryan Chief Executive Officer 2
Slide 3: Another very strong first half performance
Another very strong first half performance Excellent progress against Next Gen strategy Rebuilding scale and delivering growth +25% Financial results ahead of plan £47.3m Pre-exceptional Major refinancing to support ambitious profit before tax growth plans 3
Slide 4: Delivering increasing returns to shareholders
+9.7% Delivering increasing 3.4p Interim dividend per share 16.2% returns to shareholders RoRE 56% Equity to receivables £15m Share buyback 4
Slide 5: Consistent execution of our Next Gen strategy
Consistent execution of our Next Gen strategy Financial inclusion Organisation Technology and data Deploy product family Be a great place to work Optimise and standardise Delivering more value for processes Upgrade productivity customers Open flexible architecture Be purposeful and support Use data
Slide 6: Next Gen Financial inclusion: expanded product range
Next Gen Exciting new credit card Financial inclusion 145,000 Active credit card customers in Poland Through expanded 2x ATM, retail and online product range transactions in 12 months New digital lending in Romania 76% 84% new customers Customer satisfaction 6
Slide 7: Next Gen Financial inclusion: expanded distribution
Next Gen Retail partnerships - Financial inclusion an engine for growth 450 retail stores 99% new customers £650 average loan Through expanded distribution Strong growth New branch in of mobile wallet Mexicali +50% 85,000 mobile wallet customers 7
Slide 8: Next Gen Organisation
Next Gen Organisation Delivering process efficiency and developing talent Through being a more efficient organisation Improved ESG ratings and award wins 8
Slide 9: Next Gen Technology and data
Next Gen Technology and data Extending customer app into Hungary Through technology investment Offering omni-channel touch points to customers 9
Slide 10: Financial performance
Financial performance Gary Thompson Chief Financial Officer
Slide 11: Pre-exceptional profit before tax up by 25%
Pre-exceptional profit before tax up by 25% • Strong repayment performance underpins profits ahead of internal plan £47.3m1 • Consistent profit improvement: £37.8m 25% £33.8m - Excellent operational execution - Rigorous application of financial model • Exceptional costs of £10.8m in first half: - £5
Slide 12: Building momentum in customer lending
Building momentum in customer lending • Group customer lending up 3%: £597m £579m £195m - Strong growth of 7%, excluding Poland £190m £513m - Growth momentum building £151m 3% 8% • European home credit: - Romania, Hungary and Czech Republic combined delivered 8% growth • Mexico home credit: H1-22 H1
Slide 13: Continued strong receivables growth
Continued strong receivables growth £893m £864m £294m • Strong growth in Group receivables of 12%, excluding Poland £286m £770m £227m • European home credit: (0.4%) 9% - 9% growth in Romania, Hungary and the Czech Republic • Mexico home credit: H1-22 H1-23 H1-24 H1-22 H1-23 H1-24 1 - Good growth of
Slide 14: Stabilising receivables in Poland
Stabilising receivables in Poland £238m £232m • Home credit: £216m £192m £178m £155m £150m - 30% year-on-year reduction to £150m - Contraction now slowing - Expect return to growth by the end of 2024 • IPF Digital: FY-22 Q1-23 H1-23 Q3-23 FY-23 Q1-24 H1-24 European home credit - Poland 1 - Year-on-y
Slide 15: Progressing well towards medium-term targets
Progressing well towards medium-term targets Revenue yield Cost-income ratio1 Impairment rate 59% 18% 70% 58% 57% Target range 16% 16% 65% Target range 59.0% 56% 14% 14% 55% 60% 55.4% 12% 53% 10% 55% Ex. Poland 51% 8% 10.5% 50% 51% 6% Target range 49% 49% 4% 45% 47% 2% 45% 0% 40% H1-22 FY-22 H1-23 F
Slide 16: Continued growth in returns, earnings and dividends
Continued growth in returns, earnings and dividends Return on required equity (RoRE) Pre-exceptional earnings per share (EPS) Interim dividend per share 1.5ppts 12.6p 24% 9.7% 16.2% 10.2p 3.4p 14.7% 9.1p 3.1p 2.7p 12.3% H1-22 H1-23 H1-24 H1-22 H1-23 H1-24 H1-22 H1-23 H1-24 H1-22 H1-23 H1-24 • Improv
Slide 17: Major refinancing supports ambitious growth plans
Major refinancing supports ambitious growth plans • Successfully refinanced €341m Eurobond, well ahead of £483m +£28m maturity with very strong demand Bonds bank facilities secured in July • Fitch Ratings upgrade to BB £679m Total debt facilities • Raised and extended £23m of debt facilities in H1,
Slide 18: Strong capital position supports £15m share buyback
Strong capital position supports £15m share buyback • Equity to receivables ratio of 56% compared with 40% * target RoRE 15% - 20% • Strong capital position supports: - Ambitious growth plans - Progressive dividend policy - £15m share buyback Our Maintains equity to Supports minimum receivables rati
Slide 19: Outlook
Outlook Gerard Ryan Chief Executive Officer 21
Slide 20: Delivering growth and returns
Delivering growth and returns • Strong H1 financial performance building on solid foundations • Focus is on: - Extending financial inclusion to underserved consumers - Being a smarter and more efficient organisation - Investing in digital solutions to improve customer experience • Continuing to adap
Slide 21: Questions
Questions
Slide 22: Appendices
Appendices
Slide 23: Group
Group Change at H1 2024 H1 2023 Change Change CER £m £m £m % % Customer numbers (000s) 1,656 1,718 (62) (3.6%) (3.6%) Customer lending 597.4 578.8 18.6 3.2% 3.2% Average gross receivables 1,369.9 1,343.2 26.7 2.0% (0.1%) Closing net receivables 864.4 893.1 (28.7) (3.2%) (0.4%) Revenue 371.7 380.0 (8
Slide 24: European home credit
European home credit Change at H1 2024 H1 2023 Change Change CER £m £m £m % % Customer numbers (000s) 717 779 (62) (8.0%) (8.0%) Customer lending 315.4 310.9 4.5 1.4% 2.6% Average gross receivables 744.8 784.7 (39.9) (5.1%) (6.5%) Closing net receivables 444.0 499.1 (55.1) (11.0%) (8.5%) Revenue 166
Slide 25: Mexico home credit
Mexico home credit Change at H1 2024 H1 2023 Change Change CER £m £m £m % % Customer numbers (000s) 710 700 10 1.4% 1.4% Customer lending 156.0 142.9 13.1 9.2% 5.8% Average gross receivables 319.1 274.8 44.3 16.1% 10.0% Closing net receivables 183.0 176.1 6.9 3.9% 9.0% Revenue 139.9 125.4 14.5 11.6%
Slide 26: IPF Digital
IPF Digital Change at H1 2024 H1 2023 Change Change CER £m £m £m % % Customer numbers (000s) 229 239 (10) (4.2%) (4.2%) Customer lending 126.0 125.0 1.0 0.8% 1.5% Average gross receivables 306.0 283.7 22.3 7.9% 7.5% Closing net receivables 237.4 217.9 19.5 8.9% 10.4% Revenue 65.8 64.2 1.6 2.5% 2.8%
Slide 27: Strong financial profile
Strong financial profile H1 2024 H1 2023 Receivables (£m) 864.4 893.1 Equity (£m) 480.4 462.9 Equity to receivables 55.6% 51.8% Gearing 1.2 times 1.2 times Interest cover 2.7 times 2.2 times Pre-exceptional EPS 12.6p 10.2p Annualised pre-exceptional RoE 12.1% 11.3% Pre-exceptional RoRE 16.2% 14.7% 2
Slide 28: Balance sheet
Balance sheet H1 2024 H1 2023 Change at £m £m CER Goodwill 23.1 23.4 -% Fixed assets 67.1 64.2 6.5% Receivables 864.4 893.1 (0.4)% Cash 86.5 28.2 213.4% Borrowings (544.5) (523.0) (7.4)% Other net liabilities (16.2) (23.0) 29.3% Equity 480.4 462.9 6.3% At H1-24, borrowings is stated net of deferred
Slide 29: Exchange rates
Exchange rates Closing rates Average Closing rates Average June 2024 H1 2024 June 2023 H1 2023 Polish zloty 5.1 5.1 5.2 5.3 Czech crown 29.4 29.2 27.5 27.1 Euro 1.2 1.2 1.2 1.1 Hungarian forint 468.0 457.0 430.0 433.2 Romanian leu 5.9 5.8 5.8 5.7 Mexican peso 22.8 21.7 21.8 22.2 Australian dollar 1.
Slide 30: Contacts
Contacts Rachel Moran Investor Relations Mobile: +44 7760 167637 Email: rachel.moran@ipfin.co.uk Krzysztof Adamski Group Treasurer Mobile: +48 600 400 394 Email: krzysztof.adamski@ipfdigital.com Building a better world through financial inclusion
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