· Consolidated net revenues for the second quarter of 2016 amounted to SEK
1,475 M (1,476).
· Operating earnings (EBIT) amounted to SEK 474 M (448). The operating
earnings include revaluations of purchased debt portfolios amounting to SEK 17 M
(45). The operating margin excluding revaluations was 31 percent (28).
· Net earnings for the quarter amounted to SEK 354 M (324) and earnings per
share were SEK 4.85 (4.38).
· Cash flow from operating activities amounted to SEK 695 M (739).
· The carrying amount of purchased debt has increased by 19 percent compared
with the second quarter of 2015. Investments in purchased debt during the
quarter amounted to SEK 550 M (509).
COMMENT BY PRESIDENT AND CEO MIKAEL ERICSON
Intrum Justitia continued to perform very well during the second quarter 2016.
We achieved all of our financial targets for growth in earnings per share,
return on purchased debt and capital structure. Earnings per share rose by 11
percent over the quarter, and by 11 percent over the past 12 months, which is
slightly above our target of 10-percent annual growth. Over the quarter, we also
increased our financial flexibility by issuing bonds of EUR 160 M to Svensk
Exportkredit, which strengthens our preparedness for capturing future investment
opportunities.
Our operational development is good, with an increase in operating earnings,
excluding revaluations and currency effects of 15 percent for the second
quarter. Geographically, our development is stable, with all three of our
regions reporting improved operating profit and operating margins, adjusted for
currency effects and revaluations. Among our service lines, earnings improved
well in both Financial Services and Credit Management. Within Financial
Services, operating earnings improved due to growth in acquisitions of purchased
debt portfolios over the past 12 months. The return on purchased debt decreased
compared with the year-earlier period, due to continued price pressure, although
it reached a favorable level of 19 percent excluding revaluations. Investments
in purchased debt amounted to SEK 2.7 billion for the twelve-month period ending
as of the second quarter 2016, against SEK 1.7 billion for the twelve-month
period ending as of the second quarter 2015. In Credit Management, we are
increasing our operating earnings, primarily through tight cost control and
positive effects from acquisitions.
In our efforts to promote a healthy economy, on April 19, Intrum Justitia signed
the United Nations’ “Global Compact”. Intrum Justitia thereby undertakes to work
to integrate the ten principles of human rights, labor rights, environmental
work and anti-corruption that the Global Compact encompasses, and to submit an
annual report describing how our Group follows these principles. In addition, we
will continue our efforts to contribute to sustainable Business by improving
our customers’ competitiveness to increase employment and help debt-burdened
consumers achieve a better life by, for example, facilitating the settlement of
debts at a pace suited to the individual.
Despite certain increased political turmoil in Europe following “Brexit”, my
view of Intrum Justitia’s future potential remains positive, with us achieving
value-building growth in line with our objective of increasing our earnings per
share by at least 10 percent per year. Market conditions are generally good,
particularly in terms of the ample supply of debt portfolios and acquisition
opportunities in Credit Management. We have a proven and effective strategy
whereby, growth in purchased debt, continuous improvements in operational
efficiency and value-creating acquisitions form the cornerstones for years to
come.
PRESENTATION OF THE INTERIM REPORT
The interim report and presentation material are available at
https://www.intrum.com/en/investor-relations/. President & CEO Mikael Ericson
and Chief Financial Officer Erik Forsberg will comment on the report at a
teleconference today, starting at 9:00 a.m. CET. The presentation can be
followed at www.intrum.com and/or www.financialhearings.com. To participate by
phone, call +46 566,426 98 (SE) or +44 20 300 898 01 (UK).
FOR FURTHER INFORMATION, PLEASE CONTACT
Mikael Ericson, President and CEO, tel: +46 8 546 102 02
Erik Forsberg, Chief Financial Officer, Tel.: +46 8 546 102 02
The information in this interim report is such that Intrum Justitia AB (publ) is
required to disclose pursuant to the Securities Markets Act. The information was
released for publication on July 19, 2016 at 7:00 a.m. CET.
Intrum Justitia is Europe’s leading Credit Management Services (CMS) group,
offering comprehensive services, including purchase of receivables, designed to
measurably improve clients’ cash flows and long-term profitability. Founded in
1923, Intrum Justitia has some 3,850 employees and operations in 19 markets.
Consolidated revenues amounted to about SEK 5.6 billion in 2015. Intrum Justitia
AB is listed on Nasdaq Stockholm since 2002. For further information, please
visit www.intrum.com
