· Consolidated revenues for the third quarter of 2016 amounted to SEK 1,486 M
(1,386).
· Operating earnings (EBIT) amounted to SEK 517 M (452). Operating earnings
include revaluations of purchased debt portfolios amounting to SEK 29 M (29).
The operating margin excluding revaluations was 33 percent (31). Earnings also
include a positive effect of SEK 15 M from a divestment of purchased debt
portfolios.
· Net earnings for the quarter amounted to SEK 375 M (330) and earnings per
share were SEK 5.14 (4.51).
· Cash flow from operating activities amounted to SEK 837 M (805).
· The carrying amount of purchased debt has increased by 26 percent compared
with the year-earlier period. Investments in purchased debt for the quarter
amounted to SEK 646 M (320).
COMMENT BY PRESIDENT AND CEO MIKAEL ERICSON
Intrum Justitia continued to perform well during the third quarter. As in the
second quarter, we achieved all of our financial targets with regard to growth
in earnings per share, return on purchased debt and capital structure. Our
operating earnings of SEK 517 M are the highest in the Group’s history to-date.
Earnings per share increased over the twelve past months by 12 percent.
In our regions, the third quarter entails a strong development, mainly for
Central Europe, where good growth in purchased debt and high operating
efficiency contributes to profitable growth. Adjusted for items affecting
comparability, operating earnings in Northern Europe and Western Europe for the
third quarter were somewhat lower than the previous year.
For our service areas, we have strong growth in Financial Services. For the
third quarter, investments in purchased debt amounted to SEK 646 M, compared
with SEK 320 M for the year-earlier period. So far this year, we have increased
investments in purchased debt by around 50 percent compared with the previous
year. The return on purchased debt adjusted for items affecting comparability
and revaluations decreased compared with the year-earlier period, but remains at
a very strong level of around 18 percent. In the Credit Management Services, we
have a stable development with unchanged income and operating margins compared
to the same period last year.
I continue to view Intrum Justitia’s conditions for growth as very positive, in
a market characterized by significant opportunities. We have a good momentum in
our core business with an investment level in purchased debt that amounted to
SEK 3.1 billion in the past 12 months, compared with SEK 1.8 billion for the
same period last year. The market for purchased debt is currently undergoing a
period of price pressure, but we also see a very strong supply for the next
several years, entailing good chances to continue increasing our earnings. In
Credit Management, we have good conditions for profitable growth through add-on
acquisitions. In October, we concluded two such transactions in Denmark and
Spain and we have thereby made four add-on acquisitions so far this year.
We also continue the work to increase our addressable market through a
disciplined increase in our presence in new asset classes for purchased debt and
through growth in new customer segments. In some of our markets, we see good
opportunities to grow through acquisitions of secured debt. In both purchased
debt and in credit management, we see good potential to grow in the customer
segment for small and medium-sized enterprises. We also do not rule out
expansion to new countries in Europe if we can identify acquisitions that enable
us to reach a marketleading position. Altogether, we therefore see very good
growth opportunities for Intrum Justitia in coming years.
PRESENTATION OF THE INTERIM REPORT
The interim report and presentation material are available at
www.intrum.com/Investor relations. President & CEO Mikael Ericson and Chief
Financial Officer Erik Forsberg will comment on the report at a teleconference
on October 19, 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 (0)8 566 426 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 information that Intrum Justitia
AB (publ) is obliged to publish according to the Securities Market Act. The
information was released for publication at 7:00 a.m. CET on October 19, 2016.
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
