REVENUE UP 30%, NET PROFIT OF EUR 16.7 MILLION, REFLECTING CONTINUED GROWTH AND
INVESTMENT ACROSS THE PLATFORM
RIGA, Latvia--(BUSINESS WIRE (http://www.businesswire.com/))-- Regulatory News:
4finance Holding S.A. (the ‘Group’), one of Europe’s largest online and mobile
consumer lending groups, today announces unaudited consolidated results for the
three months ending 31 March 2016 (the ‘Period’).
Financial Highlights
· Revenue up 30% to EUR 90.3 million in the Period compared with EUR 69.2
million in the prior year period.
· The Group’s profit from continuing operations for the three months to 31
March 2016 was EUR 16.7 million, an increase of 7% from EUR 15.6 million in
2015.
· Average net loan portfolio for the Period of EUR 308.7 million, up 20% from
a year ago.
· Cost to revenue ratio for the Period was 47%, vs. 38% for the three months
to 31 March 2015, reflecting a two thirds increase in staff and investment
across the platform for future growth and geographic / product diversification.
· Financial strength continues to build, with a capital-to-assets ratio of 42%
as of 31 March 2016 (35% as of 31 March 2015).
· Credit discipline maintained, with non-performing loans to loan issuance
ratio of 9.4% as of 31 March 2016 within expected range given growth of higher
return markets with higher non-performing loan ratios.
· Adjusted EBITDA was EUR 29.1 million for the Period, leading to an adjusted
interest coverage ratio of 4.0x.
Operational Highlights
· Total number of registered customers reached 5.0 million as of 31 March
2016, up 35% from a year ago.
· Applications from mobile devices increased to 32% of total loan applications
in the Period from 13% in Q1 2015.
· Successful implementation of regulatory changes in key markets in the first
quarter of 2016, including Poland, Latvia, Sweden and re-starting lending in
Lithuania.
· Continued progress in Instalment Loans: strong volume growth in Poland after
product re-design and recent launch in Spain.
· Subsequent to quarter end: EUR 100 million bond issue with 5 year maturity
and further enhancements to management team, separating the roles of Chairman
and CEO.
Kieran Donnelly, Chairman of the Management Board, commented:
"These solid results for the first quarter, with revenue up 30% and net profit
of EUR 16.7 million, have been delivered whilst implementing regulatory changes
in four key markets and increasing staff and IT resources. The rise in our non
-performing loans to loan issuance ratio is in line with our plans and reflects
our geographic diversification.
"We are laying the foundations for the next phase of growth. Our significant
investment in people and technology continues, supporting an ambitious roll-out
plan for Instalment Loans and new markets. The recent 5 year EUR 100 million
bond issue diversifies our funding and underpins this expansion.
"As we gain global scale, our management team and structure also develops. On
this front, we have decided to split the Chairman and CEO roles and are pleased
to welcome George Georgakopoulos as CEO, while I will remain as Chairman. George
is the former CEO of Eurobank in Romania and has extensive banking experience.
This added experience and expertise will allow us to effectively manage the
larger and more complex business we envisage."
Key Financial Ratios
Three Three Year Year
Months Months Ended Ended
Ended Ended 31 31
31 31 December December
March March 2015 2014
2016 2015
2016 2015 2015 2014
Net loan portfolio (in 309.1 271.2 308.3 241.4
millions of EUR)(1)
Capital/assets ratio(2) 42% 35% 40% 35%
Capital/net loan 62% 49% 56% 47%
portfolio(3)
Adjusted interest 4.0x 3.4x 4.2x 3.7x
coverage(4)
Profit before tax 22% 28% 23% 27%
margin(5)
Return on average 37% 51% 41% 54%
equity(6)
Cost/revenue ratio(7) 47% 38% 42% 37%
Net impairment to 25% 25% 25% 25%
revenue ratio(8)
Non-performing loans to 9.4% 9.0% 9.0% 8.8%
loan issuance ratio(9)
Notes:
(1) Gross loan portfolio less provisions for bad debts.
(2) Total equity/total assets (2014 assets adjusted for effect of bond
defeasance).
(3) Total equity/net loan portfolio.
(4) Adjusted EBITDA/interest expense.
(5) Profit before tax/interest income.
(6) Profit from continuing operations/average equity (total equity as of the
start and end of each period divided by two).
(7) General administrative expenses/interest income.
(8) Net impairment losses on loans and receivables/interest income.
(9) Non-performing loans with a delay of over 90 days/value of loans issued. The
value of loans issued represents loans issued for the two-year period before
commencement of the 90 day past-due period, eg for 31 March 2016: 1 January 2014
to 31 December 2015.
Conference call
A conference call with management to discuss these results is scheduled
for Thursday, June 2 at 15:00 UK time. To register, please
visit www.4finance.com/investors (http://cts.businesswire.com/ct/CT?id=smartlink
&
url=http%3A%2F%2Fwww.4finance.com%2Finvestors&esheet=51353108&newsitemid=0&lan=e
n
-US&anchor=www.4finance.com%2Finvestors&index=1&md5=003e4ee763b6f5ed01dc24c0ff47
8
212).
About 4finance
Established in 2008, 4finance is one of the largest and fastest growing online
and mobile consumer lending groups in Europe with operations in 14 countries.
Putting innovative data-driven analysis into all aspects of the business,
4finance has grown rapidly, issuing over EUR 3 billion in single payment and
instalment loans to date.
4finance operates through a portfolio of market leading brands with strong
regional presence including Vivus, SMSCredit and Zaplo. A responsible lender,
offering simple, convenient and transparent products and service, 4finance is
meeting growing customer demand from those under-served by conventional lending.
4finance has group offices in Riga (Latvia), London (UK) and Miami (USA), and
currently operates in Argentina, Armenia, Bulgaria, the Czech Republic, Denmark,
Finland, Georgia, Latvia, Lithuania, Mexico, Poland, Romania, Spain and Sweden.
To support its international expansion, 4finance continues to pursue a twin
-track strategy of strong organic growth bolstered by targeted acquisition.
Forward looking statements
Certain statements in this document are “forward-looking statements”. These
statements are based on management’s current expectations and are subject to
uncertainty and changes in circumstances. Actual results may differ materially
from those included in these statements.
FINANCIAL REVIEW
Income Statement
The table below sets out the condensed consolidated statement of profit and loss
for the three months ending 31 March 2016 and 31 March 2015.
3 months to 31 March
2016 2015
(unaudited) (unaudited) % change
(in millions of EUR)
Interest income 90.3 69.2 +30%
Interest expense (7.5) (7.1) +6%
Net interest income 82.8 62.1 +33%
Net impairment losses (22.3) (17.2) +30%
on loans and
receivables
General administrative (42.4) (26.6) +59%
expenses
Other income/(expense) 1.8 1.3 +38%
Profit before tax 20.0 19.6 +2%
Corporate income tax (3.2) (4.0) (20)%
for the reporting
period
Profit from continuing 16.7 15.6 +7%
operations
Profit from — 5.1 (100)%
discontinued
operations, net of tax
Profit for the period 16.7 20.7 (19)%
Interest income
The table below shows key drivers of interest income, or revenue, i.e. business
volumes and interest rates.
3 months to 31 March
2016 2015 % change
(in millions of EUR)
Total value of loans issued 266.9 255.3 +5%
Average net loan portfolio 308.7 256.3 +20%
Average annualized interest 117% 108%
rate on loans to customers
Interest income, or revenue, for the Period was EUR 90.3 million, a 30% increase
compared with EUR 69.2 million for the three months ending 31 March 2015. This
reflects the 20% increase in the average balance of the net loan portfolio and
the 9 percentage point increase in average interest rate. The value of loans
issued increased across the majority of our markets, and higher growth continues
to be seen in Poland, Georgia and Spain, where interest rates are also typically
higher. Volumes were lower in Lithuania due to the introduction of more
restrictive legislation on affordability and the re-starting of lending in late
January.
Interest expense
Interest expense for the Period was EUR 7.5 million, a 6% increase compared
with EUR 7.1 million for the three months ending 31 March 2015. This increase is
mainly due to the SEK 225 million bond issued in March 2015 and SEK 150 million
additional issue in September 2015. The average balance of the Group’s
indebtedness in the Period decreased to EUR 224.6 million from EUR 230.5
million, with an average interest rate of 13.4%, a similar rate to the prior
year.
Net impairment losses on loans and receivables
Net impairment losses for the Period were EUR 22.3 million, a 30% increase
compared with EUR 17.2 million for the three months ending 31 March 2015. The
increase in net impairment losses was in line with the increase in revenue, and
primarily reflects the expansion and seasoning of the Group’s portfolio in both
existing and new jurisdictions, as well as its application of prudent,
conservative impairment policies. Net impairment losses represented 25% of
interest income, the same ratio as last year.
General administrative expenses
General administrative expenses reported for the Period were EUR 42.4 million, a
59% increase compared with EUR 26.6 million reported for the three months ending
31 March 2015. The Group continued its significant investment across the
business to support future growth. The increase in personnel costs reflects the
significant staff growth over the past year, mainly attributable to hiring in
product development, IT, risk, legal & compliance and finance. Marketing
campaigns were used to maintain leading positions in existing markets. The Group
has also continued its investment in IT platforms to ensure the appropriate
infrastructure is in place to support the development of the business. Legal and
consulting expense and other costs include certain one-off items related to the
evaluation of potential acquisitions and funding opportunities.
The table below sets out a breakdown of the Group’s general administrative
expenses.
3 months to 31 March
2016 2015
(in millions of EUR)
Personnel costs 13.9 6.3
Marketing and sponsorship 13.8 11.6
IT expenses 3.2 2.4
Debt collection costs 2.9 1.4
Legal and consulting 2.6 0.9
Application inspection costs 1.0 0.9
Rent and utilities 0.9 0.5
Depreciation and amortization 0.8 0.3
Other 3.2 2.3
Total 42.4 26.6
For the first quarters of 2016 and 2015, marketing and sponsorship costs
accounted for 33% and 44% respectively, and personnel costs accounted for 33%
and 24%, respectively, of general administrative expenses.
Variable costs (i.e., all marketing and sponsorship costs, personnel costs,
application inspection costs, IT expenses, debt collection costs, communication
expenses and bank services) accounted for 89% of total administrative costs in
both the three months ending 31 March 2016 and 31 March 2015. Such costs
generally correlate to movements in loan sales over time.
Other income/(expense)
Other income for the Period amounted to EUR 1.8 million. For the three months
ending 31 March 2015, other income was EUR 1.3 million. The increase in other
income was mainly due to the net effect of FX hedging and interest income from
other loans.
Profit before tax
For the reasons stated above, the Group’s profit before tax for the Period was
EUR 20.0 million, a 2% increase compared with EUR 19.6 million for the three
months ending 31 March 2015. The profit before tax margin, i.e., profit before
tax as a percentage of interest income, was 22% for the Period and 28% for the
three months ending 31 March 2015.
Corporate income tax
The Group’s corporate income tax expense decreased by 20% to EUR 3.2 million for
the Period, compared with EUR 4.0 million for the three months ending 31 March
2015.
The table below sets out a breakdown of the Group’s corporate income tax.
3 months to 31 March
2016 2015
(in millions of EUR)
Current tax 7.6 5.2
Deferred tax (4.4 ) (1.2 )
Total 3.2 4.0
The lower tax expense during the Period compared to the prior year is related to
treatment of deferred tax assets.
Profit from continuing operations
For the reasons stated above, the Group’s profit from continuing operations for
the Period was EUR 16.7 million, a 7% increase compared with EUR 15.6 million
for the three months ending 31 March 2015.
Profit from discontinued operations, net of tax
There were no operations classified as discontinued in the Period. For the prior
year period, former operations in Estonia, Russia and United Kingdom were
reflected separately as discontinued operations which recorded a profit of EUR
5.1 million for the three months ending 31 March 2015.
Profit for the period
For the reasons stated above, profit for the Period was EUR 16.7 million, a 19%
decrease compared with EUR 20.7 million for the three months ending 31 March
2015.
Other financial data – EBITDA and Adjusted EBITDA
Three Year Year
Months Ended Ended
Ended 31 31 31
March December December
2016 2015 2014
2016 2015 2014
(in
millions
of EUR)
Profit for the 16.7 64.1 46.3
period
Provision for 3.2 15.7 11.6
corporate income
tax
Interest expense 7.5 28.7 23.8
Depreciation and 0.8 1.6 0.9
amortization
EBITDA 28.2 110.1 82.6
Adjustments 1.5 9.6 5.6
Adjusted 29.7 119.7 88.2
EBITDA (1)
Note:
(1) Adjusted EBITDA is a non-IFRS measure that represents EBITDA (profit for the
period plus tax, plus interest expense, plus depreciation and amortization) as
adjusted by income/loss from discontinued operations, non-cash gains and losses
attributable to movement in the mark-to-market valuation of hedging obligations
under IFRS, goodwill write-offs and certain other one-off or non-cash items.
Adjusted EBITDA, as presented in this report, may not be comparable to similarly
-titled measures that are reported by other companies due to differences in the
way these measures are calculated.
Balance Sheet
The table below sets out the Group’s condensed consolidated statement of its
financial position.
31 March 31 31 March
2016 December 2015
(unaudited) 2015 (unaudited)
(audited)
(in
millions of
EUR)
Cash and cash equivalents 30.5 56.9 46.3
Loans and advances due from 309.1 308.3 271.2
customers
Property and equipment 4.6 4.3 2.6
Intangible assets 21.6 18.0 4.6
Loans to related parties 16.9 13.7 11.0
Deferred tax asset 17.1 12.9 12.1
Current tax assets 5.9 5.5 0.0
Financial instruments at fair 5.6 10.6 24.0
value through profit or loss
Prepaid expenses 6.4 2.7 3.2
Other assets 36.1 5.2 4.3
Total assets 453.6 438.2 379.3
Loans and borrowings 219.7 229.5 227.8
Corporate income tax payable 8.9 7.4 0.4
Provisions 2.4 2.4 1.4
Other liabilities 31.3 25.7 17.8
Total liabilities 262.3 265.0 247.4
Share capital 35.8 35.8 35.8
Retained earnings 187.6 171.0 128.2
Reorganization reserve (31.1 ) (31.1 ) (32.6 )
Currency translation reserve (4.5 ) (5.1 ) (0.5 )
Share based payment reserve 2.0 1.4 0.1
Obligatory reserve 0.2 0.2 0.1
Total equity attributable to 189.9 172.2 131.1
the Group’s equity holders
Non-controlling interests 1.3 1.1 0.8
Total equity 191.2 173.3 131.9
Total shareholders’ equity 453.6 438.2 379.3
and liabilities
Assets
The Group had total assets of EUR 453.6 million as of 31 March 2016, compared
with EUR 438.2 million as of 31 December 2015, representing an increase of EUR
15.4 million, or 4%. The Group intends to obtain a banking license, potentially
via an acquisition in the EU. The Group has considered a number of banking
targets, including companies of material size with respect to the Group with an
acquisition cost of approximately EUR 75 million. During the period the Group,
in cooperation with its shareholder, started to allocate the necessary resources
for a potential acquisition. The growth in other assets mainly relates to the
allocation of EUR 25 million for this.
As of 31 March 2016 and 31 December 2015, 75% and 83% respectively of the
Group’s assets were self-liquidating (i.e., loans and advances from customers
and cash as a percentage of total assets).
Loan Portfolio
As of 31 March 2016, the Group’s net loan portfolio equalled EUR 309.1 million,
compared with EUR 308.3 million as of 31 December 2015, representing an increase
of EUR 0.8 million, or 0.2%. The Group’s loan portfolio accounted for 68% of
total assets as of 31 March 2016 and 70% of total assets as of 31 December 2015.
Classification of the Group’s Loan Portfolio
The following table sets out the classification of the Group’s total loan
portfolio in terms of performing and non-performing loan portfolios as of the
dates indicated.
Loan 31 March 31
portfolio 2016
December
2015
Gross Amount Allowance Net % of Net Gross
Allowance Net % of Net
for Amount Portfolio Amount
for Amount Portfolio
doubtful
doubtful
debts
debts
(in millions
of EUR,
except
percentages)
Performing 264.2 (26.5 ) 237.7 76.9% 268.4
(24.3 ) 244.2 79.2%
Non 175.9 (104.5 ) 71.4 23.1% 157.0
(92.9 ) 64.1 20.8%
-performing
Total (1) 440.1 (131.0 ) 309.1 100.0% 425.5
(117.2 ) 308.3 100.0%
Note: (1) Loan amounts include accrued interest.
Performing Loan Portfolio
The following table shows the Group’s performing loan portfolio by product as of
the dates indicated.
31 March 31
2016 December
2015
Amount % of Amount % of
Portfolio Portfolio
Performing loan (in millions
portfolio by of EUR,
product: (1) except
percentages)
Single Payment Loans 175.7 66.5% 177.3 66.1%
Instalment Loans 87.7 33.2% 90.6 33.8%
Line of Credit 0.8 0.3% 0.5 0.2%
Total performing 264.2 100.0% 268.4 100.0%
loan portfolio
Note:
(1) Loan amounts include accrued interest.
Non-performing Loan Portfolio
The Group has written off any loans which have been overdue for more than 730
days. As of 31 March 2016, the Group’s total non-performing loan portfolio was
EUR 175.9 million, representing 9.4% of the value of loans issued between 1
January 2014 and 31 December 2015. Given the mostly short-term nature of the
Group’s lending, the majority of loans issued during a reporting period are
repaid prior to the period end, while non-performing loans are accumulated for
730 days. The Group’s non-performing loan (NPL) portfolio as of 31 March 2016
represented 40% of total gross loans outstanding as of that date. EUR 15.8
million, or 9.1%, of this was non-performing interest. The Group’s total gross
non-performing loan portfolio increased by 18.9 million, or 12%, during the
Period. The trend in non-performing loans is in line with expectations given the
growth of the portfolio in higher return markets such as Spain and Georgia that
also have higher NPL/gross portfolio ratios (average 48%). Spain and Georgia
represented 19% of the gross portfolio as of 31 March 2016, compared with 15% as
of 31 December 2014. The Instalment Loan portfolio is also seasoning in Denmark
and had lower new originations in Finland (product discontinued) and Lithuania
(as noted earlier).
The following table sets out an analysis of the Group’s NPL portfolio (including
non-performing interest) by product.
31 March 2016 31 December 2015
(in millions of EUR, except percentages)
Non-performing loan
portfolio by product: (1)
Single Payment Loans 129.0 118.6
Instalment Loans 46.8 38.4
Total non-performing loan 175.9 157.0
portfolio
Value of loans issued(2) 1,867 1,734
Non-performing loans as a 9.4% 9.0%
share of value of loans
issued
Allowance for doubtful NPL 104.5 92.9
debts
Allowance for doubtful NPL 59% 59%
debts / non-performing loans
Overall allowance / NPL 74% 75%
coverage ratio
Average Loss Given Default 51% 53%
rate
Notes:
(1) Loan amounts include accrued interest.
(2) The value of loans issued as of a particular date represent loans issued for
the two-year period before commencement of the 90 day past-due period. For
example, the applicable period for the 31 March 2016 reporting date is 1 January
2014 to 31 December 2015.
Liabilities
The Group had total liabilities of EUR 262.3 million as of 31 March 2016,
compared with EUR 265.0 million as of 31 December 2015, representing a decrease
of EUR 2.7 million. Liabilities mainly consist of loans and borrowings, which
reduced slightly during the quarter as outlined below.
Loans and borrowings
As of 31 March 2016, the Group had loans and borrowings of EUR 219.7 million,
compared with EUR 229.5 million as of 31 December 2015. The Group’s loans and
borrowings accounted for 84% of total liabilities as of 31 March 2016 and 87% of
total liabilities as of 31 December 2015. The table below sets out the loans and
borrowings by lender as of the dates indicated.
31 March 2016 31 December 2015
Long term (in millions of EUR)
AS Trasta Komercbanka 4.4 4.7
2019 Notes 164.0 167.2
2018 Notes 39.4 40.8
Other(1) 1.5 0.7
Total long term 209.3 213.5
Short term(2)
AS Trasta Komercbanka 1.2 1.2
2019 Notes 2.6 7.7
2018 Notes 0.0 1.2
Other(1) 6.6 5.8
Total short term 10.4 16.1
Total loans and borrowings 219.7 229.5
Note:
(1) ‘Other’ consists primarily of loans with related parties.
(2) Includes accrued but unpaid interest.
In May 2011, AS 4finance entered into a credit line agreement with AS Trasta
Komercbanka (‘TKB’), which allows borrowings of up to EUR 7.7 million (the ‘TKB
Credit Line’). As of 31 March 2016, the amount outstanding under the TKB Credit
Line was EUR 5.6 million at an interest rate of 7%.
In August 2014, 4finance S.A. issued USD 200.0 million of 11.75% notes (the
‘2019 Notes’) which are listed on the Irish Stock Exchange and are senior to all
of the Group’s future subordinated debt. As of 31 March 2016, the amount
outstanding and accumulated interest under the 2019 Notes was EUR 166.6 million.
The 2019 Notes will mature in August 2019.
In March 2015, 4finance S.A. issued SEK 225.0 million of 11.75% notes (the ‘2018
Notes’) which are senior to all of the Group’s future subordinated debt. The
2018 Notes were listed on the corporate bond list of Nasdaq Stockholm in August
2015. In September 2015, a further SEK 150.0 million of 2018 Notes were issued
at par, bringing the total amount outstanding to SEK 375.0 million out of a
total programme size of SEK 600.0 million. As of 31 March 2016, the amount
outstanding and accumulated interest under the 2018 Notes was EUR 39.4 million.
The 2018 Notes will mature in March 2018.
Equity
As of 31 March 2016, the Group’s total equity amounted to EUR 191.2 million,
compared with EUR 173.3 million as of 31 December 2015, representing an increase
of EUR 17.9 million, or 10%, which was mainly attributable to profits generated.
The Group has not paid any dividends to its shareholders within the Period and
its capital to assets ratio as of 31 March 2016 was 42%. The capital to net loan
portfolio ratio as of 31 March 2016 was 62%, reflecting the Group’s strong
capitalisation.
Off-Balance Sheet Arrangements
In connection with the Group’s line of credit product, it had contractual
obligations for undrawn credit facilities totalling EUR 0.8 million as of 31
March 2016. The Group has no other off-balance sheet commitments or obligations
outstanding.
Condensed Consolidated Statement of Cash Flows for the Period
The table below sets out the Group’s condensed consolidated statement of cash
flows.
3 months to 31 March
2016 2015
Cash flows from operating activities (in millions of EUR)
Profit before taxes 20.5 24.8
Adjustments for:
Depreciation and amortization 1.0 0.3
Net losses on foreign exchange from borrowings (5.9 ) (5.4 )
Increase in impairment allowance 13.3 11.5
Write-off and disposal of intangible and property 0.1 —
and equipment assets
Provisions 0.2 0.5
Interest income (1.4 ) (0.6 )
Interest expenses 7.5 7.0
Equity-settled share-based payment transactions 0.6 —
Profit or loss before adjustments for the effect of 35.8 38.1
changes to current assets and short term liabilities
Adjustments for:
Increase in loans due from customers (14.6 ) (42.5 )
Change in financial instruments measured at fair 3.9 (5.6 )
value through profit or loss
Increase in other assets (8.7 ) 22.6
Increase in accounts payable to suppliers, 5.5 (0.1 )
contractors and other creditors
Gross cash flows from operating activities 22.0 12.5
Corporate income tax paid (6.5 ) (6.5 )
Net cash flows from operating activities 15.5 5.9
Cash flows from investing activities
Purchase of property and equipment and intangible (5.5 ) (2.7 )
assets
Loans issued to related parties (4.5 ) (1.7 )
Interest received 1.1 —
Allocation for potential acquisition (24.8 ) —
Net cash flows used in investing activities (33.8 ) (4.3 )
Cash flows from financing activities
Loans received and notes issued 16.7 28.3
Repayment and repurchase of loans and notes (11.6 ) (5.2 )
Interest payments (13.2 ) (12.4 )
Net cash flows from financing activities (8.1 ) 10.7
Net (decrease) / increase in cash and cash (26.4 ) 12.3
equivalents
Cash and cash equivalents at the beginning of the 56.9 33.7
period
Effect of exchange rate fluctuations on cash 0.1 0.2
Cash and cash equivalents at the end of the period 30.5 46.3
Net cash flows used in operating activities are calculated as profit before
taxes, adjusted for non-cash and other items and the effect of changes to
current assets and short-term liabilities, less corporate income tax paid. Net
cash flows generated in operating activities in the Period increased to EUR 15.5
million from EUR 5.9 million in the same period last year.
The Group’s cash flows used in investing activities mainly include the purchase
and disposal of property, equipment and intangible assets, loans issued and
loans repaid. Net cash used in investing activities was EUR (33.8) million in
the Period. The largest component was the allocation of EUR 25 million made in
respect of a potential acquisition, as described earlier in the report under
Assets.
The Group’s cash flows from financing activities mainly reflect proceeds that
were received from borrowings, the repayment of principal and interest on
indebtedness, and the payment of dividends.
RECENT DEVELOPMENTS
Recent developments include significant and material information about the
Group’s development and any changes since its last quarterly report that was
published on 29 February 2016.
Significant changes in indebtedness
On 23 May 2016, 4finance S.A. issued EUR 100.0 million of 11.25% senior
unsecured bonds due in May 2021. The bonds have been listed on the Frankfurt
Stock Exchange 'Open Market' and application will be made to list them on the
regulated market within 6 months. Proceeds from the bond issue will be used for
general corporate purposes and for potential selected acquisitions.
Litigations and contingent liabilities
No member of the Group is engaged in new legal or arbitration proceedings which
may have a material effect on the Group’s financial position or profitability.
Changes in management
In May 2016, the decision was taken to separate the roles of Chairman and CEO.
Kieran Donnelly remains as Chairman of the Management Board, and George
Georgakopoulos has joined the Group as Chief Executive Officer.
George has over 20 years of banking experience and was most recently CEO of
Bancpost, the retail focused Romanian bank, and Group Country CEO for Eurobank,
with responsibility for over EUR 3.5 billion of assets. Prior to the CEO role,
George, as Executive VP directly managed over EUR 2 billion of personal lending
portfolios and the bank’s retail operations. Before joining Eurobank in 2008, he
spent 13 years at Barclays Bank and Barclaycard with senior roles including head
of strategy for new business opportunities in IT/tech. From 1997 to 2000, he was
seconded to EBA Clearing to establish the pan-European clearing system, working
extensively with major banks across Europe and the European Central Bank. George
studied law at Athens Law School and has an MBA from Glasgow University.
Changes in the regulatory framework
New regulations took effect in Poland as of 11 March 2016, as described in
previous reports.
New regulations on consumer credit have been proposed in the Czech Republic,
including minimum capital base and registration with Czech National Bank for
lenders, internal controls, treatment of sales intermediaries, affordability
criteria and delinquency fee caps. These regulations are expected to be
finalized in the autumn of 2016.
Corporate
website: www.4finance.com (http://cts.businesswire.com/ct/CT?id=smartlink&url=ht
t
p%3A%2F%2Fwww.4finance.com&esheet=51353108&newsitemid=0&lan=en
-US&anchor=www.4finance.com&index=2&md5=7e4bcf2a47ae0fbd9e2940059bdc3bbb)
4finance Holding S.A.
Address: 6, rue Guillaume Schneider, L-2522, Luxembourg
4finance Holding S.A.
investorrelations@4finance.com
HQ Address: Lielirbes iela 17a-8, Riga, LV-1046, Latvia
www.4finance.com (http://cts.businesswire.com/ct/CT?id=smartlink&url=http%3A%2F%
2
Fwww.4finance.com&esheet=51353108&lan=en
-US&anchor=www.4finance.com&index=3&md5=ebb134962938dd3c96baafbc2e24371f)
4finance Reports Results for the Three Months Ending 31 March 2016
| Source: 4finance S.A.
Attachments
